Final Order 1

Order Details: Copy  of Judgment
Pdf Text: (1) CC. No.4504/SS/2018 [Judg.]
CNR No.MHMM19-011830-2018
Received on : 12 11 2018
Registered On : 13 11 2018
Decided on : 11 08 2026
Duration : Y M D
07 08 29
IN THE COURT OF
JUDICIAL MAGISTRATE, FIRST CLASS
[63RD COURT, ANDHERI, MUMBAI]
[PRESIDED OVER BY SHRI. D. P. KASAT]
C.C. No.4504/SS/2018
Exh.67
Pravin Chhapwale
Proprietor of M/s. Texpo Industries,
114, Ansa Industrial Estate,
Saki Vihar Road, Andheri (West),
Mumbai-400 072. ...Complainant
Versus
Tanmai Subhash Bhosale
Proprietor of M/s. Waffles Hut,
Fineox Mall, Viman Nagar,
Shop No.27, 1st Floor, Nagar Road,
Lohgaon, Pune-411 014. ...Accused
________________________________________________________
Adv. for Complainant : Shri. Sundar Mendon
Adv. for Accused : Shri. K. N. More/ Smt. Shital Mishra
________________________________________________________
J U D G M E N T
(Delivered on 11/08/2026)
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 under :
2] Complainant is a sole proprietor of proprietorship
firm namely M/s. Texpo Industries and carrying on business of
manufacturer, dealer and seller of waffles machines, pancake
machines, topping warmer and allied machines and accessories
with his various clients in Mumbai, Pune and all other places in
India. Accused was one of his client who purchased waffles
machines and other accessories on different dates and on
different purchase orders as well as invoices. Complainant
supplied goods to the accused against verbal orders and
delivered with delivery challans which were signed by accused.
Accused used to make payments by cheques towards supply of
goods and for which complainant used to issue receipts.
3] Against the supply of goods amounting to
Rs.9,50,546/- to him, the accused issued seven cheques bearing
Nos.143516 dated 24/08/2018, 143517 dated 31/08/2018,
143518 dated 01/08/2018, 143519 dated 06/08/2018, 143515
dated 10/08/2018, 143514 dated 17/08/2018 all drawn on the
Saraswat Co-operative Bank Ltd., Kharadi, Pune and 092268
dated 07/09/2018 branch Sinhagad Road, Pune.
4] The complainant deposited above referred cheques
for encashment with his banker i.e. Kotak Mahindra Bank Ltd.
Andheri (E) branch Mumbai. However, all the cheques were
returned dishonoured with memos dated 10/09/2018 for the
reason ‘Funds Insufficient’. Thereafter, on 28/09/2018,
complainant issued demand notice through his advocate by
R.P.A.D. which was returned without any proper reason and
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therefore, advocate of complainant sent notice through email on
the email address of the accused on 29/09/2018. Even the
accused had received and acknowledged said notice through
email and replied that he will pay the amount of all cheques.
However, after receipt of notice, accused approached him with a
request that the entire amount of cheques will be repaid by him
on weekly installment basis. Accordingly, an amount of
Rs.1,00,000/- was paid by two cheques of Rs.50,000/- each.
However, thereafter, the accused stopped further payment.
Despite several requests, accused did not pay the balance
amount of Rs.8,50,546/-. As such the accused has committed
the offence punishable under Section 138 of the Negotiable
Instruments Act. Hence, this complaint.
5] The plea of accused came to be recorded vide
Exh.11 by explaining the substance of accusations against him,
to which he pleaded not guilty and claimed to be tried.
6] As per provisions of section 143 of the N. I. Act,
1881 this case can be tried as a summary triable case. So also,
the Court has option to try it in summary manner or to try it in
the procedure laid down for summons trial case. As per Section
262(1) of Criminal Procedure Code, 1973 read with section 143
of the Act, there is an option to the Magistrate whether to adopt
the summary trial or not. The record of this case shows that,
this case is tried as per the procedure of summons trial case. The
evidence of witnesses is recorded separately and in exhaustive
manner and not as laid down in section 263 of the Code of
Criminal Procedure, 1973.
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CNR No.MHMM19-011830-2018
7] Complainant examined himself by way of affidavit
of examination-in-chief at (Exh.12) and also examined manager
of Saraswat Bank, Kharadi branch, Pune Mr. Kapil Kane as C.W.2
at (Exh.45), and manager of Kotak Mahindra Bank, Mumbai as
C.W.3 at (Exh.51) and closed his evidence vide pursis (Exh.60).
Apart from this oral evidence, the complainant has relied upon
following documentary evidence :
Documents Exhibit
Tax invoices 21 Collectively
Delivery challan 22
Disputed cheques 23 to 29
Bank memos 30 to 36
Demand notice 65
Postal receipt 37
Return envelop alongwith
acknowledgment card
38 and 39
Bank statement of complainant 49
Bank account statement of
complainant
52
8] An opportunity of explaining all the incriminating
circumstances appearing in evidence of complainant was given
to accused while recording his statement under Section 313 of
the Code of Criminal Procedure at (Exh.62). In his above said
statement he has stated that he placed orders for supply of
machines but he did not receive it. So also, he has contended
that he gave disputed cheques towards security, however,
without his consent, complainant deposited them for
encashment. So also, he had replied notice and had not
promised to pay the cheques’ amount. He has further contended
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that the complainant used to supply machinery only after
receiving the advance payment. He did not examine any witness
in support of his defence.
9] Heard oral arguments of the learned advocate for
both sides.
10] Learned Advocate for the complainant submitted
that the complainant has adduced sufficient evidence on record
in order to prove the guilt of the accused beyond all reasonable
doubts. As per his contention, the cheques in question have been
issued by the accused in discharge of his legal liability and all
those cheques were dishonored for the reason ‘funds
insufficient’. According to him, despite due service of notice, the
accused failed to repay the amount of cheques within stipulated
time. As per his contention, the partial repayment of the amount
of cheques will not absolve the criminal liability of the accused.
Accordingly, he prayed for maximum possible punishment
against the accused and award of compensation to the
complainant.
11] On the contrary, the learned Advocate for the
accused submitted that the complainant has failed to discharge
his burden of proof. As per his contention the notice is not duly
served upon the accused. According to him, the complainant has
misused the cheques issued only as a security. He has further
contended that the complainant has failed to prove that there
was liability of accused equivalent to the amount of cheques on
the date of issuance of those cheques. According to him, the
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accused is falsely implicated in this case and deserves to be
acquitted.
12] From the accusations in the complaint, evidence of
complainant and arguments of both sides, following points arise
for determination, to which findings are recorded followed by
reasons thereunder :
Sr.No POINTS FINDINGS
1 Does the complainant prove that,
accused issued disputed cheques in his
favour for discharging legally
enforceable liability or debt ?
Yes
2 Does the complainant prove that he
presented the cheques within
prescribed period for encashment and
they were dishonored for the reason
“Funds Insufficient” ?
Yes
3 Does the complainant prove that he
issued statutory notice to the accused
within prescribed period and in spite of
receipt of it, accused failed to pay the
amount of disputed cheques to him
within stipulated period?
Yes
4 What order ? Accused is
convicted.
R E A S O N S
AS TO POINT NO.1:
13] At the outset, it is essential to mention here that the
provisions of Section 138 of N.I. Act provides that the drawer of
the cheque is deemed to have committed the offence if, the
accused had drawn a cheque on an account maintained by him
with a banker for the payment of any amount of money to the
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complainant and such cheque is drawn for the discharge of the
‘whole or part’ of any debt or other liability. It is also essential to
mention here that the ‘debt or other liability’ means a legally
enforceable debt or other liability.
14] It is also essential to mention here that the
provisions of Section 139 of the N.I. Act rescues the complainant
with a presumption that unless the contrary is proved, the
complainant has received the cheque for the discharge of, in
whole or in part, any debt or other liability.
15] In this background, if the evidence adduced by the
complainant is perused, it appears that he has reiterated all the
contentions of his complaint in the affidavit of examination-in-
chief at Exh.12. During his cross-examination, it has come on
record that the business transaction between M/s.Texpo
Industries i.e. the firm of complainant with M/s. Waffles Hut i.e.
the firm of accused are going on since year 2014. Even it has
come on record that the cheques in question were not issued
against any particular invoice, but they were issued randomly.
This circumstance shows that the payments in respect of the
goods purchased by accused were not made by him as per every
invoice and those were made on account. Apart from this,
except mere suggestions and their denials, nothing has been
brought on record during cross-examination of the complainant
in order to discard his contentions about the transactions taken
place between himself and accused.
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16] At this juncture, a glance towards the documents
i.e. the tax invoices at Exh.21 collectively shows that the accused
has purchased goods from the complainant from time to time.
17] Further the evidence of C.W.2 i.e. the manager of
Saraswat Co-operative Bank, Kharadi Branch, Pune (Exh.45)
clearly shows that the accused maintains a bank account in the
name of M/s. Waffles Hut in the said bank. It also becomes clear
from the evidence of this witness that all the disputed cheques
were drawn on the Saraswat Co-operative Bank by the accused
and were issued in favour of the complainant. It also becomes
clear from the evidence of this witness that all the disputed
cheques were dishonoured upon their presentment for
encashment, for the reason ‘funds insufficient’. This fact is even
more substantiated by the documents at Exh.23 to 29 and 30 to
36 i.e. the cheques and cheque return memos.
18] It is also significant to note that the C.W.2 has
produced account statement of the accused for the period from
01/06/2018 to 31/12/2018 at Exh.49. A careful perusal of the
entries in this account statement shows that at the time when
these cheques were presented for encashment by complainant,
there was no balance in the account of the accused in order to
honour those cheques.
19] Similarly the evidence of C.W.3 i.e. the manager of
Kotak Mahindra Bank, Mumbai (Exh.51) shows that the
disputed cheques were deposited by the complainant with his
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banker and those were received by the banker of the
complainant dishonoured for the reason ‘funds insufficient’. This
fact is even more substantiate by the account statement of the
complainant’s account at Exh.52.
20] In this regard the accused has tried to contend that
though he is a proprietor of M/s. Waffles Hut and though he has
given order for supply of machines to the complainant, he has
not received the machines from the complainant, there appears
no substance in his contention. On the contrary, perusal of the
documents and more particularly the tax invoices placed on
record by the complainant shows that the machines were
delivered to the accused by the complainant and the payments
against those goods was due and outstanding towards the
accused.
21] Apart from this, it has come on record that after the
dishonour of the cheques, the complainant had issued notice to
the accused by post as well as by email. It is also pertinent to
note that the accused himself has contended that he had replied
said notice. However, no such reply notice has been placed on
record by him. On the contrary, the complainant in his re-
examination has clearly deposed that after receipt of notice, the
accused had given in writing to pay Rs.95,000/- per week.
Accordingly, the accused had paid Rs.4,50,000/- in all to him. In
this regard during the cross-examination of the complainant,
even these contentions raised by the complainant are not denied
by the accused.
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22] This circumstance shows that after receiving
demand notice, the accused had paid an amount of
Rs.4,50,000/- to the complainant. If at all, the accused had not
received any goods from the complainant and if at all the
accused was not liable to the complainant, why he has paid said
amount to the complainant after receipt of demand notice by
him, is not at all explained or answered by the accused. This
circumstance and this conduct of the accused itself is sufficient
to give even more boost to the presumption under Section 139
of the Negotiable Instruments Act that the accused had issued
the cheques in question in discharge of his liability arising out of
the business transactions entered into by him with the
complainant.
23] In these circumstances and in view of the evidence
placed on record, it becomes crystal clear that the cheques in
question were issued by the accused in discharge of his legally
enforceable liability. Consequently, the point No.1 under
determination is answered in the affirmative.
AS TO POINT NO.2:
24] From the documents and more particularly the
cheque return memos placed on record by the complainant at
Exh.30 to 36 clearly appears that the cheques in question are
returned unpaid for the reason ‘Funds Insufficient’.
25] In view of this documentary evidence, it becomes
clear that the cheques in question are dishonoured for the
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reason “Funds Insufficient” and accordingly, point No.2 under
determination is answered in the affirmative.
AS TO POINT NO. 3 :
26] At this juncture, it is essential to mention here that
the provisions of Section 138 clause (b) and (c) of N.I. Act
prescribes that, in order to constitute an offence under this
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.
27] However, in the present matter, as discussed above,
in the demand notice dated 28/09/2018 issued by the
complainant, the cumulative amount of all the disputed cheques
was demanded by him to the accused. However, it has also come
on record that though the accused had replied said notice
through email and agreed to repay the amount of cheques,
initially only an amount of Rs.1,00,000/- was repaid by him.
Subsequently, it has also come on record that in all an amount of
Rs.4,50,000/- is paid by the accused to the complainant.
However, this circumstance itself is sufficient to show that the
accused has not fulfilled the requirement of the statute in
respect of repayment of entire amount of cheques within
stipulated period of 15 days. It is needless to mention here that
partial payment of the amount of cheques cannot be termed as
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due compliance of the demand notice. However, all these
circumstances and evidence placed on record categorically leads
to show that the demand notice is duly served upon the accused
by the complainant and the accused has failed to repay the
amount of cheques within stipulated time. Consequently, point
No.3 under determination is answered in the affirmative.
AS TO POINT NO. 4:
28] In view of the findings recorded to point Nos.1 to 3,
it becomes crystal clear that the complainant has succeeded to
discharge his burden of proof by proving all the essential
ingredients of section 138 of the N.I. Act. Accordingly, the
accused is held guilty for the offence punishable under Section
138 of the N.I. Act. Accordingly, I hereby call upon accused to
hear him on the point of sentence.
29] However despite repeated calls, the accused and his
advocate remained absent. This conduct of the accused and his
advocate itself is sufficient to show that the accused has nothing
to submit on the point of sentence. On the contrary, the
complainant and his advocate are present. The learned advocate
of complainant submitted that accused is intentionally not
appearing in the Court. As per his contention, the accused be
punished to the extent of maximum possible imprisonment and
at the same time, compensation be awarded to the complainant.
30] I have given thoughtful consideration to the
submissions and facts of this case. It is needless to mention here
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that this being an economic offence, the question of extending
benefit of probation of Offender’s Act to the accused does not
arise. More so, though the complainant has filed this complaint
under Section 138 of the N.I. Act, it appears that the amount
involved in this matter is in respect of business transactions
between the parties. More so, it has also come on record that
after issuance of demand notice, the accused had paid an
amount of Rs.4,50,000/- to the complainant and even this fact is
clearly stated by the complainant himself. Though this partial
payment of amount of cheques will not absolve the criminal
liability of the accused, this fact can very well be considered
while imposing sentence against the accused.
31] In such circumstances and while looking at these
peculiar facts of this case, it would be just and proper to show
some leniency to the accused while imposing the sentence of
imprisonment as well as compensation. As far as the sentence of
imprisonment is concerned for the commission of the offence
punishable under Section 138 of the N.I. Act and while looking
at the nature of transaction between parties, so as to meet the
ends of justice, a sentence of imprisonment for a period of two
months against the accused would suffice.
32] Apart from this, as far as the sentence of
compensation is concerned, admittedly, the amount of cheques
in this case is Rs.9,50,546/- out of which an amount of
Rs.4,50,000/- is already paid by the accused. However, it is also
a fact on record that the complainant has faced this litigation for
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about seven years. In such circumstances, it would be just and
proper to award him adequate compensation in addition to the
amount already paid by the accused. While looking at the
circumstances of this case and the nature of transaction between
the parties, it appears that awarding compensation equivalent to
the amount of cheques in question would be a sufficient
compensation to the complainant.
33] Considering all these aspects, the amount of total
compensation is required to be determined at Rs.9,50,546/- vide
Section 357(3) of the Code of Criminal Procedure. In default of
payment of compensation, a sentence of one month
imprisonment would serve the purpose. Accordingly, following
order is passed in answer to point No.4 under determination:
ORDER
(1) Accused is convicted of an 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 rigorous imprisonment for a period
of two months.
(2) The accused is further directed to pay an amount of
Rs.9,50,546/- (Rupees Nine Lakh Fifty Thousand Five
Hundred and Forty Six only) within a month from today
to the complainant as compensation vide Section 357(3)
of the Code of Criminal Procedure, 1973. In default of
payment of compensation, he shall suffer simple
imprisonment for a period of one month.
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(3) If the compensation amount will be deposited, the whole
amount be paid to the complainant after the lapse of
appeal period.
(4) Accused to surrender to his bail bonds.
(5) As the accused is absent and the sentence of
imprisonment is not suspended, issue conviction
warrant against accused under Section 418(2) of the
Code of Criminal Procedure alongwith copy of this
judgment.
(6) Copy of judgment be given free of costs to accused.
Date : 11/08/2026
D. P. Kasat
Judicial Magistrate, First Class
63rd Court, Andheri, Mumbai.
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