Final Order 3

Order Details: Copy  of Judgment
Pdf Text: (1) CC. No.601/SS/2018 [Judg.]
CNR No.MHMM19-002915-2018
Received on : 02 02 2018
Registered On : 07 03 2018
Decided on : 29 11 2025
Duration : Y M D
07 09 27
IN THE COURT OF
JUDICIAL MAGISTRATE, FIRST CLASS
[63RD COURT, ANDHERI, MUMBAI]
[PRESIDED OVER BY SHRI. M. S. BUDHWANT]
C.C. No.601/SS/2018
Exh.41
Gaurav Vishnu Verma
R/at : 606, Amber Building, Suresh Nag,
RTO Lane, 4 Bunglows, Andheri (West),
Mumbai-400 053. ...Complainant
Versus
Sunil Shridharan Nair
R/At : Flat No.14, 2nd Floor,
Indira Sadan, Wagle Estate,
Kisan Nagar No.3, Thane-400 605. ...Accused
________________________________________________________
Advocate for Complainant : Shri. Amit Chavan
Advocate for Accused : Shri. Birendra Kumar Sinha
________________________________________________________
J U D G M E N T
(Delivered on 29/11/2025)
The accused is facing trial for an offence punishable
under Section 138 of the Negotiable Instruments Act
(hereinafter referred to as the N.I. Act).
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Brief facts of the complainant’s case are as follows:
2] Complainant was introduced to the accused by
estate agent Mr Vishal Nishchal. Complainant was in need of
temporary premises for residential use, and the accused wanted
to give his flat on rent bearing No.705 situated at 7th Floor,
Building No.6 at Haware City, G.B. Road, Kasarvadavali, Thane.
Complainant and accused entered into a leave and license
agreement on 19/10/2016. Complainant paid Rs.1,80,000/- to
the accused towards advance rent, brokerage and security
deposit of the flat, plus his flight ticket, and credit card
outstanding. The accused failed to obtain a no-objection
certificate from the police and permitted the complainant to take
possession of said flat. Accused assured the complainant that he
would arrange a better and bigger flat and started demanding
money to clear his debts, believing in him, the complainant kept
transferring online payments to the accused’s account and made
an online transfer of Rs.1,15,000/- and also paid Rs.65,000/- by
cash to the accused. Thereafter, the complainant came to know
that the accused was cheating him under the pretext of getting
an alternate accommodation. Therefore, he demanded the
refund of his money given to the accused. The complainant
could not move into the flat No.705, at Haware City, as the
possession of said flat was refused to him due to deficient
services by the accused, as he was unable to comply with the
statutory requirements. The accused also failed to show him an
alternate flat in lieu of flat No.705. Therefore, he demanded that
his entire money spent and given by him to the accused.
3] Accused towards the discharge of legally
enforceable debt and liability, issued four cheques bearing
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Nos.077373, 077374, 077375 and 077371, all drawn on Union
Bank. The complainant deposited a cheque bearing No.077375
dated 15/11/2017 of Rs.10,000/- for encashment with his
banker i.e. ICICI Bank Andheri (E) branch. However, it was
dishonoured with the remark ‘Funds Insufficient’. Thereafter, the
complainant issued a demand notice to the accused through an
advocate by R.P.A.D. Inspite of the receipt of notice, the accused
did not pay the cheque amount to the complainant. Hence, this
complaint.
4] After perusal of the complaint, verification
statement, and documents produced on record, a process was
issued against the accused for the offence punishable under
section 138 of the Act. In pursuance of the summons, the
accused appeared. The particulars of the offence was explained
to the accused vide plea at Exhibit No.9. The accused did not
plead guilty and claimed to be tried.
5] Complainant examined himself and led his evidence
as C.W.1 at (Exh.10). He has closed his evidence vide pursis
(Exh.39).
6] Complainant has relied upon the following
documentary evidence :
Documents Exhibit
Cheque 13
Cheque return memo 14
Demand notice 15
Postal receipt 16
Return envelop 18
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CNR No.MHMM19-002915-2018
Acknowledgment card 17
Copy of notice contained in envelope 19
7] The accused has been absent for a long time. Non-
bailable warrants as well as a proclamation were issued against
him; however, he did not bother to remain present before the
Court and avail himself of the opportunity to explain the
circumstances appearing against him, nor did he put forward his
defence. Hence, vide order dated 08/08/2025, his statement
under Section 313 of Cr. P.C. was dispensed with.
8] Heard Learned advocate for the complainant. The
accused and his advocate are absent. No final argument was
advanced on behalf of the accused, despite sufficient
opportunities. Hence, by passing an order, his right to argue is
forfeited.
9] From perusal of the complaint and evidence as well
as argument advanced by the learned advocate for the
complainant, the following points arise for my determination,
and I have given my findings on them with the reason stated
below :
Sr.No POINTS FINDINGS
1 Does the complainant prove that the
accused issued a disputed cheque in his
favour for discharging a legally
enforceable liability or debt?
Yes
2 Does the complainant prove that he
presented the cheque within the
prescribed period for encashment, and
it was dishonored for the reason
“Funds Insufficient”?
Yes
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3 Does the complainant prove that he
issued a statutory notice to the accused
within the prescribed period, and the
accused, inspite of receipt of it, failed
to pay the amount of the disputed
cheque to him within the stipulated
period?
Yes
4 What order? The accused is
convicted.
R E A S O N S
AS TO POINT NO.1:
10] Section 138 of N.I. Act provides that the drawer of
the cheque is deemed to have committed the offence if, among
other ingredients, the following ingredients are fulfilled :
(i) The accused drew a cheque on an account maintained by him
with a banker for the payment of any amount of money to the
complainant.
(ii) The cheque is drawn for the discharge of the ‘whole or part’
of any debt or other liability. ‘Debt or other liability’ means a
legally enforceable debt or other liability.
11] To prove the allegation levelled against the accused,
the complainant has led his evidence vide affidavit of
examination-in-chief (Exh.10). He has relied upon documents
filed along with the list (Exh.11). He has reiterated all the
contentions of the complaint in his affidavit. He has stated that
he was introduced to the accused by estate agent Mr Vishal
Nishchal. Complainant was in need of temporary premises for
residential use and the accused wanted to give his flat on rent
bearing No.705 situated at 7th Floor, Building No.6 at Haware
City, G.B. Road, Kasarvadavali, Thane. Complainant and accused
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entered into a leave and license agreement on 19/10/2016.
Complainant paid Rs.1,80,000/- to the accused towards advance
rent, brokerage and security deposit of flat, plus his flight ticket,
credit card outstanding. The accused failed to obtain a no
objection certificate from the police and permitted the
complainant to take possession of said flat. Accused assured
complainant that he would arrange a better and bigger flat and
started demanding money to clear his debts, believing in him,
complainant kept transferring online payments to his account
and made an online transfer of Rs.1,15,000/- and also paid
Rs.65,000/- by cash to the accused. Thereafter, the complainant
came to know that the accused was cheating him under the
pretext of getting an alternate accommodation. Therefore, he
demanded the refund of his money given to the accused. The
complainant could not move into the flat No.705, at Haware
City, as the possession of said flat was refused to him due to
deficient services by the accused, as he was unable to comply
with the statutory requirements. The accused also failed to show
him an alternate flat in lieu of flat No.705. Therefore, he
demanded his entire money spent and given by him to the
accused. Accused towards the discharge of legally enforceable
debt and liability, issued four cheques bearing Nos.077373,
077374, 077375 and 077371, all drawn on Union Bank. The
complainant deposited a cheque bearing No.077375 dated
15/11/2017 of Rs.10,000/- for encashment with his banker i.e.
ICICI Bank Andheri (E) branch. However, it was dishonoured
with the remark ‘Funds Insufficient’.
12] The Ld. Advocate for the complainant has submitted
that the oral evidence of the complainant is corroborated by
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documentary evidence. The accused did not cross-examine the
complainant and therefore, the complainant's oral evidence
remained unchallenged. He has further submitted that the
complainant has proved his case against the accused. Lastly, he
submitted to convict the accused.
13] The present case is filed under Section 138 of N.I.
Act therefore, it is necessary to discuss the legal principle laid
down by the Hon’ble Apex Court in the case of Rangappa V/s.
Sri Mohan [(2010) 11 SCC 441] wherein it has been held that,
“presumption provided under Section 139 of the N.I. Act is a
rebuttable presumption, and it is open to the accused to raise a
defence wherein the existence of a legally enforceable debt or
liability can be contested. It has also held that the standard of
proof for doing so is that of “preponderance of Probabilities”. It
has also held that if the accused is able to raise a probable
defence which creates doubt about legally enforceable liability,
the prosecution can fail. The accused can rely on the materials
submitted by the complainant in order to raise such a defence,
and it is conceivable that in some cases the accused may not
need to adduce evidence for his/ her own.
14] The Hon’ble Apex Court in the case of M/s.
Kalamani Tex and another V/s. P. Balasubramanian
[MANU/SC/0066/2021] has held that, “Section 118 and 139 of
N.I. Act mandates that once the signature of an accused on the
cheque is established, then the ‘reverse onus’ clause becomes
operative. It has also held that in such a situation, the obligation
shifts upon the accused to discharge the presumption imposed
upon him.
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15] Section 139 of the N.I. Act provides that it shall be
presumed, unless the contrary is proved, that the holder of the
cheque received the cheque of the nature referred to in section
138 of the N.I. Act. for the discharge in whole or in part of any
debt or liability. In view of the section, it is incumbent upon the
court to presume that the cheque issued was in discharge of the
debt. The Negotiable Instruments Act lays down special rules of
evidence and certain special presumptions and precludes certain
pleas being raised in particular circumstances. There is a
presumption under section 118 of N.I. Act that the consideration
has passed for the execution of Negotiable Instruments. Said
presumption is a rebuttable one. The accused can rebut the
presumption by putting his defence to the test of preponderance
of probability.
16] It is to be noted from the evidence that the accused
has not conducted the cross-examination nor denied his
signature on the disputed cheque. The statement of the accused
under Section 313 of Cr.P.C. has been discarded as per the order
dated 08/08/2025. After perusal of the cheque (Exh.13), it
appears that the accused’s name is mentioned below his
signature. It is not a disputed position that the cheque (Exh.13)
is not of the accused's account and is signed by him. Thus, the
complainant has proved the first ingredient that the accused
drew the disputed cheque in favour of the complainant. Now, it
is to be ascertained whether the accused has given the said
cheque to the complainant for the discharge of any debt or other
legal liability.
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17] As per the ratio laid down by the Hon’ble Apex
Court in the case of Rangappa and Kalamani Tex (supra) it is
settled position of law that standard for rebuttal of presumption
under Section 139 is of preponderance of probabilities and for
such rebuttal inference can be drawn not only from the material
brought on record by the parties, but also from the
circumstances relied upon by them. The complainant in his
evidence affidavit stated that he was in need of temporary
premises for residential use and the accused wanted to give his
flat on rent bearing No.705 situated at 7th Floor, Building No.6
at Haware City, G.B. Road, Kasarvadavali, Thane. They entered
into a leave and license agreement on 19/10/2016.
Complainant kept transferring online payments to the accused’s
account and made an online transfer of Rs.1,15,000/- and also
paid Rs.65,000/- by cash to the accused towards advance rent,
brokerage and security deposit of the flat, plus his flight ticket,
credit card outstanding. The accused failed to obtain no
objection certificate from the police and permitted the
complainant to take possession of said flat. Thereafter, the
complainant came to know that the accused was cheating him
under the pretext of getting an alternate accommodation.
Therefore, he demanded refund of money given by him to the
accused. Accused towards the discharge of legally enforceable
debt and liability, issued four cheques bearing Nos.077373,
077374, 077375 and 077371, all drawn on Union Bank. Except
cheque bearing No.077375 dated 15/11/2017 of Rs.10,000/-,
the complainant did not produce other documents regarding the
transaction and payment issued by him to the accused of
Rs.1,80,000/-. However, the accused did not conduct the cross-
examination of complainant on the above oral evidence, even
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though sufficient opportunities were given to him. Therefore,
the complainant’s testimony in his evidence affidavit remains
unchallenged.
18] As per sections 139 and 118 (a) of the N.I. Act,
there is a presumption that the holder of a cheque received the
cheque of the nature referred to in section 138 of the N.I. Act for
the discharge in whole or in part of any debt or liability. The
complainant has proved that the cheque (Exh.13) was of the
accused’s account and bears the accused’s signature in his
evidence. The accused did not cross-examine the complainant.
Therefore, there is no defence regarding as to how the cheque
came into the complainant’s possession. Thus, in the absence of
cross-examination, it appears from the oral as well as
documentary evidence led by the complainant and legal
presumption that the accused issued the cheque (Exh.13) for
discharging his legally enforceable liability. Therefore, I hold
that the complainant has proved point No.1. Thus, I answer it as
“Yes”.
AS TO POINT NO.2:
19] The complainant has deposed that he deposited the
cheque in question (Exh.13) for clearance with his banker i.e.
ICICI Bank, Andheri West Branch, but it was dishonored for the
reason ‘Funds Insufficient’ on 16/12/2017.
20] It is opt to refer here to Section 146 of the N.I. Act
which provides that the Court shall, in respect of every
proceeding under this Chapter, on production of a bank’s slip or
memo having thereon the official mark denoting that the cheque
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has been dishonoured, presume the fact of dishonour of such
cheque, unless and until such fact is disproved.
21] It is a settled principle of law that the complainant
has to prove his case on his own legs. Contentions of the
complainant that the cheque was presented for encashment and
it was dishonoured for the reason ‘Funds Insufficient’ remain
unchallenged. His evidence on said aspect is corroborated by the
cheque return memo (Exh.14). Considering the date on the
cheque (Exh.13), date of deposit and date of return mentioned
on the memo (Exh.14), it appears that the cheque was deposited
within the stipulated period i.e. three months for clearance. It
also appears from the cheque return memo (Exh.14) that the
cheque was dishonoured for the reason mentioned in the
evidence of the complainant, i.e. ‘Funds Insufficient’.
22] In view of the oral as well as documentary evidence
referred above, it is established that the cheque was presented
for encashment within the prescribed period and it was
dishonored for the reason “Funds Insufficient”. Therefore, I
answer point No.2 as “Yes”.
AS TO POINT NO. 3 :
23] The complainant has given evidence that after
getting knowledge about dishonor of the cheque, he issued a
demand notice (Exh.15) dated 26/12/2017 to the accused by
R.PA.D. demanding the amount of the cheque. He affirms that
the notice was served on the accused vide acknowledgment card
(Exh.17) and in spite of receipt of it, the accused failed to pay
the amount of the cheque to him within the stipulated period.
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24] Section 138 clause (b) and (c) of N.I. Act prescribes
that, in order to constitute an offence under the section demand
notice for the payment of cheque amount should be given in
writing to the drawer of cheque by the payee within 30 days of
the receipt of information by him from the bank regarding the
return of the cheque as unpaid and the drawer of the cheque
fails to make the payment of the amount of money to the payee
within 15 days of the receipt of the notice.
25] Oral evidence of the complainant, on the point of
issuance of notice to the accused, is substantiated by a copy of
notice at (Exh.15). His testimony that notice was sent by R.P.A.D
to the accused is corroborated by a copy of postal receipt
(Exh.16). His evidence that the accused received the notice at
his address is substantiated by the acknowledgment card
(Exh.17).
26] Considering the date of getting knowledge of
dishonor of the cheque by the complainant and the date of
issuance of the demand notice by him, it appears that the notice
was given within the prescribed period of one month to the
accused. It appears that notice was duly served on the accused.
In view of the aforesaid discussion and legal position, I held that
the complainant has proved that he issued a statutory notice to
the accused within the prescribed period, and in spite of receipt
of it, the accused failed to pay the amount of the cheque to him
within the stipulated period. Therefore, I answer point No.3 as
“Yes”.
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AS TO POINT NO. 4:
27] In view of the findings recorded against point Nos.1
to 3, I hold that the complainant has proved the essential
ingredients of section 138 of N.I. Act against the accused beyond
a reasonable doubt. Therefore, I find the accused guilty of the
said offence. I stop here my judgment to hear the accused on the
point of quantum of sentence.
Date : 29/11/2025
Shri. M. S. Budhwant
Judicial Magistrate, First Class
63rd Court, Andheri, Mumbai.
28] The complainant is present. He has submitted that
the accused may be imposed a heavy fine and double the
amount of the cheque may be granted as compensation to him.
He further submits that the accused may be sentenced to severe
imprisonment.
29] The Accused and his advocate are absent. In order
to pass a sentence to the accused, he can be given an
opportunity. However, he is absent. He has not attended the
Court for long, and N.B.W. is pending against him. In view of
Section 143(3) of the N.I.Act, every trial under this section shall
be conducted as expeditiously as possible, and an endeavour
shall be made to conclude the trial within six months from the
date of filing of the complaint. There is no provision under
Chapter XX of the Code. to hear the accused on the point of
sentence as found in Section 248(2) of Chapter IXX of the Code.
However, all the mitigating factors in favour of the accused are
considered.
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30] This court has considered the probability of
extending the benefit of 'Probation' to the accused. This offence
is an economic offence. Though it is a criminal trial, considering
the statement, objects, and reasons while enacting this
legislation, it is understood that the very object of the Act is to
enhance the credibility of transactions by cheque. The
complainant has already suffered the consequences of the
dishonor of the cheque. In this background, setting the accused
free on a bond of Probation will not meet the ends of justice.
Hence, this Court is of the opinion that this is not a fit case to
extend the benefit of Probation to the accused.
31] Giving careful thought to the peculiar circumstances
of the case and the sentencing policy, the sentence should be just
adequate to have deterrence. The case has been dragged for
more than seven years. The sentence of compensation alone
would not serve the purpose. In this background, the accused
needs to be sentenced to imprisonment for one month also.
Amount of cheque is Rs.10,000/-. The cheque is of the year
2017. Thus, I am of the opinion that the complainant will be
adequately compensated only if he gets twice the amount of the
disputed cheque.
32] Considering all these things, the amount of
compensation is determined as Rs.20,000/- vide Section 357(3)
of the Code of Criminal Procedure. In default of payment of
compensation, a sentence of an additional fifteen days
imprisonment is awarded. Thus, in answer to point No.4
following order is passed :
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O R D E R
(1) Accused is convicted of the offence punishable under
section 138 of the Negotiable Instruments Act vide
Sec.255(2) of the Code of Criminal Procedure and is
sentenced to suffer simple imprisonment for one month.
(2) He is directed to pay an amount of Rs.20,000/- (Rupees
Twenty Thousand only) within a month from today to
the complainant as compensation vide empowerment of
Section 357(3) of the Code of Criminal Procedure, 1973,
in default of payment of compensation, he shall suffer
simple imprisonment for an additional fifteen days.
(3) If the compensation amount is deposited, the whole
amount will be paid to the complainant after the appeal
period is over.
(4) He shall surrender his bail bonds.
(5) Issue a standing warrant against him.
(6) A copy of the judgment shall be given free of cost to the
accused after the execution of the warrant against him.
Date : 29/11/2025
Shri. M. S. Budhwant
Judicial Magistrate, First Class
63rd Court, Andheri, Mumbai.
Dictated on : 29/11/2025
Transcribed on : 29/11/2025
Signed on : 29/11/2025
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