IN THE COURT OF SUB-DIVISIONAL JUDICIAL MAGISTRATE NO.2, KAMRUP(M).

U/S. 138 Of Negotiable Instruments Act, 1881

(j ~\\ JudgmentOJ~~~~\C\'S ~tl\e\{o) .

~a~tu9 GU'H3na\\ 1. Case of the complainant MIs More .Brothers, which is a business firm

carrying business of food items having its principal place of business at

TRP Road, Fancy Bazar, Guwahati-1, in brief is that the accused persons

MIs Roy Enterprise and Sri Chinmoy Roy, who is the proprietor of accused

no. 1, paid Rs. 3,15,306/- (Rupees Three Lakhs Fifteen Thousand Three

Hundred and Six) only on 10/01/2009 vide cheque no. 007157 dated.

10.01.2009 drawn on ICiCI Bank ltd., Silchar towards payment of business

dues to the complainant. When the said cheque was duly deposited with

the bankers of the Complainant HDFC Bank, Fancy Bazar Branch for

payment, it was returned unpaid by the Bank due to 'Funds not sufficient'

vide ICICI Bank's Memo dated 17.04.2009. Thereafter, the complainant on

27.04.2009 issued a notice upon the accused persons through" his

advocate under Negotiable Instruments Act by registered post with A/D

vide Rl-A.D. A 4684 dated 27.04.2009 and RL-A.D.A 4685 dated

27.04.2009 posted from Guwahati GPO and the same was duly received

by the accused persons on 04.05.2009. But the accused persons failed

and neglected to pay the same even after the receipt of the said notice

and as such the complainant lodged this complaint under section 138 of

the Negotiable Instruments Act, 1881.

Manoj Kumar More in support of his case. The defense side examined 3

witnesses including the accused himself.

4. In this case accused No.1, M/S Roy Enterprise is the juristic person who is

~

represented by accused No.2 who is the proprietor of it Sri Chinmoy Roy.0.-\\

SOJW\ (5 0) O\stfiCTnecase of the defense as revealed from the statement of the accused'Metf '

i<.all"fUP \ • na\i. GU\iJ<3 recorded under section 313 Cr.P.C. and the evidence led by the defence is

as follows. In his statement recorded under section 313 Cr.P.C. the

accused person denied the allegation made by the complainant and

stated that he had not issued to the complainant the cheque no. 007157

dtd. 10.01.2009 towards payment of any business dues to the

complainant. He also stated that no legal notice was received by him as

stated by the complainant. He further stated that he came to know about

the said cheque from the Statement of the Bank and thereafter he sent a

letter to the Bank to stop payment. He stated that he did not issue any

cheque. His cheque was lost. The accused has contended that that he is

not liable to pay any amount to the complainant and hence prayed for his

acquittal. There is no existing debt or liability.

5. I have heard the learned counsels for both the parties, perused the recard

and framed the following points for determination.

1. Whether the accused issued the cheque for the discharge of any

legally ,enforceable debt or liability?

2. Whether the cheque was dishonoured for insufficient funds in the

account of the accused?

3. Whether the accused received the demand notice issued by the

complainant regarding the dishonor of the cheque?

~ ./ A. POINT FOR DETERMINATION NO.1: Whether the accused issued the~N~:::~SOJ J\ t e~O) O\stt\C

t• cheque for the discharge of any legally enforceable debt or liability?

u ff\fU? ~ ,,,an~t\t' G\.\'I ,

7. The complainant had contended that the accused owed Rs.

3,15,306/- to him and in discharge of the aforesaid debt the accused gave

him the aforesaid cheque in question. The complainant has examined its

proprietor Shri Manoj Kumar More as PW 1. P.W.1 deposed during his

evidence in chief that the accused No. 2 is the proprietor of M/s Roy

Enterprise i.e., Accused no. 1. On 10/01/2009 the accused persons issued

the cheque in question bearing no: 007157 dated 10/01/2009 of

Rs.3,15,306/- towards payment of business dues to the complainant

drawn on of ICICIBank ltd, Silchar. The said cheque is produced by him

and marked as exhibit 1. Ext.1 (i) and 1 (ii) are the signature of the

accused no:2 and Exhibit 1 (iii) is the name of the complainant firm on the

cheque. He deposited the aforesaid cheque in his bank at HDFCBank,

Fancy Bazar Branch for payment. The cheque was returned unpaid by

accused persons banker ICICIBank vide return memo dated 17/04/2009

During cross examination P.W.1 stated that in the

complaint petition his name is not there but his signature is in it. He has

not submitted any document relating to any transaction with the accused.

He has not submitted any document relating to any due of the accused

towards him. The accused himself handed over the cheque to him. It was

January in the year 2009. The accused brought the cheque

has not signed before him. He further deposed that he

posited the cheque on 17.04.2009 at HDFC Fancy Bazar Branch. He

accused no. 2) on the cheque. At the time of giving the articles other

'persons also remains present. His father and brother knew about it. His

father and brother knows about business transaction and other persons

does not know about that. He further stated that the accused has not

submitted any document in the court relating to the accused making any

promise to the complainant. He denied the suggestion that the accused

has not issued any cheque to him and he himself kept the cheque with

~

him putting the signature. He further deposed that the earlier business~ -,\ -

OJN\ .~\&r,ansactions were made by account payee cheque and he has not5 tW\e\fO) ?\

\<.arl'\fUP GU"lJanat\ submitted any receipt or any document in the court relating to the

accused taking any articles from him. He also has not submitted any

document in this case relating to any transaction. He further stated that

he was informed about the cheque dishonor after 2,3 days of the cheque

being dishonoured from the Bank. He could not remember the date of the

memo of return. He denied the suggestion that there was no business

transaction between him and the accused and in order to take undue

advantage he filed this case. I have perused the cheque (Exhibit 1) and it

shows that the same is issued in the name of the complainant.

Now let me discuss the evidence on record and try to find out

if the accused could raise a probable defense that he does not have any

existing debt or liability.

10. The accused (OWl) had examined himself and he has deposed

that he is the Proprietor of M/S Roy Enterprise. He came to know from his

Bank statement of ICICIBank, Silchar Branch that a cheque was deposited

in his account and some amount has been deducted from his account due

to dishonor of the said cheque. On enquiry he came to know that the

cheque has been missing from the cheque book. Immediately he

instructed Bank to stop payment of the said cheque. The accused

produced the said letter dated. 08/05/2009 and exhibited the same as

"

further stated that Ext- 1 is a cheque of his cheque book. The account

numbered in Ext-l belongs to him. He did not lodge any FIRregarding loss

of his cheque. He did not file any criminal case on this matter anywhere.

summons he came to depose in this case. He has been authorized by the

branch manager to depose in this case. He exhibited Ext- B as the

authority letter and Ext- B (1) as the signature of the branch manager. He

further deposed that Exhibit 1 is the cheque of his bank belonging to Sri

Chinmoy Roy of Roy Enterprise. Ext- 2 is the Return Memo issued by his

Branch. He further stated that they do not verify signature if there is

insufficient fund in the account. In his cross examination he stated that

Ext-7 is the bank statement of the account of the Accused. Ext- 7(i) is the

balance in the account as on 17/04/2009. Ext- 8 is the certificate regarding

the specimen signature of the accused. Ext- 8(i) is the specimen signature

of the accused. He further stated that there is a column in the cheque

return memo which states about the difference in the signature.

Questioned Documents Department, Forensic Science Laboratory,

". Kahilipara, stated that she received a cheque for comparison of signature~,.,"'\.,; ~onconnection with this case.The divisional incharge endorsed her to the

documents for examination and accordingly she examined the questioned

and the admitted signatures. She further deposed that after examination

she found that the questioned signature was not signed by the person

who wrote the admitted signature. She prepared a detailed report in this

regard and Exhibit-C is the said report and Ext- C (1) is her signature. In

her cross examination she stated that she has not filed any document to

show that she was endorsed with the examination of the document. She

Il /' further deposed that she is the Sr. Scientific officer but she has not filed

_~ ~,(. .fJ(IY document to show the same.I \. \•...'

his Bank statement of ICICI Bank, Silchar Branch that a cheque was

deposited in his account and some amount has been deducted from his

account due to dishonor of the said cheque. On enquiry he came to know

that the cheque has been missing from the cheque book. Immediately he

instructed Bank to stop payment of the said cheque. The accused

produced the said letter dated 08/05/2009 and exhibited the same as

Exhibit -A and his signature on it as Ext- A (1).

In his cross examination he stated that he did not know the

complainant and does not have any relation with the complainant. He

admittedly said that Ext- 1 is a cheque of his cheque book and that the

account numbered in Ext-1 is his. Though the accused taken the plea that

he does not have any relation with the complainant and the said cheque

was missing from his cheque book but· he could substantiate it by

adducing any evidence. P.W.1 the complainant has deposed that the

accused on 10/01/2009 issued the cheque in question towards 1:he

discharge of his debt of Rs.3,lS,306/- towards payment of business dues

to the complainant. The said cheque is produced and marked as exhibit 1.

Ext.1 (i) and 1 (ii) are the signature of the accused no.2 and Exhibit 1 (Hi)

is the name of the complainant firm on the cheque. Though the accused

raised a plea that he lost the cheque in question but he could not prove

its loss by adducing any evidence. If at all his statement is to be believed

then he should have lodged a FIR before police or complaint before the

e neither lodged any FIR regarding loss of his cheque nor filed any

riminal caseon this matter anywhere.

Accused further stated that the signature reflected in Ext -1 is

not his signature. To prove the same the accused examined FSLexpert as

D.W.3 Smti Tilaka Das who in her deposition stated that after

examination she found that the questioned signature was not signed by

the person who wrote the admitted signature. She exhibited the detailed

~

report prepared by her as Exhibit-C and Ext- C (1) which is her signature.,'>lO •• \\ .

sO f: ) ) O'stf\<8Uton perusal of the return memo of the cheque it is found that the said;' un (N\etrO " •·,amf y "'\18,1

GUW.... ,. cheque was returned due to funds not arranged for and not because of

variation or difference in the signature of the accused no.2. Hence the

Accused cannot wipe its hand from the liability by simply saying that the

signature on Ext-1 is not his. In this regard Learned counsel for the

complainant cited an Apex Court judgment reported in 2012 (11) SCALE

365, MiS Laxmi Dyechem vs. State of Gujarat & ors in which

expression "amount of money .... is insufficient" appearing in Section 138

of the Act is a genus and dishonour for reasons such "as account closed",

"payment stopped", "referred to the drawer" are only species of that

genus. Just as dishonour of a cheque on the ground that the account has

been closed is a dishonour falling in the first contingency referred to in

Section 138, so also dishonour on the ground that the "signatures do not

match" or that the "image is not found", which too implies that ...the

specimen signatures do not match the signatures on the cheque would

constitute a dishonour within the meaning of Section 138 of the Act."

the dishonour takes place on account of the substitution by a new set of

authorised signatories resulting in the dishonour of the cheques already

issued and another situation in which the drawer of the cheque changes

his own signatures or closes the account or issues instructions to the bankI >

c ••••.• ·:.••••~not to make the payment. So long as the change is brought about with a::\ R··;"~_7:~~:~·""i ·~:i

"1 ~ .,' r>I:" ,~.yJewto preventing the cheque being honoured the dishonour would. .... ;;; ~''; c,' :f

':'"~~~become an offence under Section 138 subject to other conditions

prescribed being satisfied." Thus, from the ratio laid down by the Hon'ble

Supreme court in the case cited above it can be held that variation in

signature in the cheque cannot absolve the accused from his liability to

pay so long as he has a legally enforceable debt and he issued the cheque

to discharge that debt or Iiabitlity .Here in the instant casethough there is

variation in the signature as per the expert report (Ext-C) it cannot

absolve the accused from his liability so long he cannot rebut the

fA ~._ resumption raised by section 139 of the N.I. Act and prove by adducingJtJ\~ ~~\S\{\C\,

S u?~tJ\e\to)t evidence that he had no legally enforceable debt.a~f G\j\j'Jana \

During argument Learned counsel for the accused cited

Krishna Janardan Bhat Vs. Dattatraya G. Hegde reported in (2008) 4 see54 in which Hon'ble Supreme court held that "Section 139 merely raises a

presumption in favour of the holder of the cheque that the cheque has

been issued for discharge of any debt or other liability. Existence of legally

recoverable debt is not a matter of presumption under section 139 of the

On this aspect Learned counsel for the complainant submitted

that the above cited case is already overruled by a larger bench of Hon'ble

Supreme Court in "Rangappa Vs. Sri Mohan" reported in (2010) 11 SCC

441 wherein Hon'ble Apex Court held that the presumption mandated by

section 139 includes a presumption that there exists a legally enforceable

debt or liability. This is of course in the nature of 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.

However, therein, there can be no doubt that there is initial presumption

which favours the complainant.

As discussed above and from the ratio laid down by the Hon'ble

Apex court it can be held that there is always a presumption u/s 139 of

judgment reported in AIR 2001 SC2895, K. N. Beena Vs. Muniyappan and

Anr in which Hon'ble Supreme Court has held that burden of proving that

the cheque has not been issued for any debt or liability is on the accused.

Denial/ averments in reply by accused are not sufficient to shift burden of

~

proof on the complainant. Accused has to prove in trial by leading cogentNO _\1

JtJ\ WleUo) ?\~tf\~Vidence that there was no debt or liability.~9rt\tY~~u~a\'\at\

22. Here in the instant casethe accused could not prove that he has

no debt or liability towards the complainant by leading any cogent

evidence. Moreover, the accused could not demolish the testimony of the

complainant side. Rather in the given set of evidence, it appears

authentic and convincing to me to believe the complainant side. Hence it

may be safely held that the accused issued the cheque for the discharge of

a legally enforceable debt or liability.

B.JPOINT FOR DETERMINAnON NO.2: Whether the cheque was

dishonoured for insufficient funds in the account of the accused?

23. The complainant has deposed that the aforesaid cheque was

presented to his bank for encashment, but the same was dishonoured

because of insufficient funds in the account of the accused., The

complainant has produced the cheque return memo and the same is

marked as exhibit 2 which shows that the said cheque was dishonoured

for funds not arranged for on 26/2/2010 and the complainant was

informed on 17/04/2009.

the accused has not issued any cheque to him and he himself kept the

cheque with him putting the accused persons signature. But they could

evidence. As such it is held

In addition to the above section 146 of the Negotiable

Instruments Act,1881 provides that the court shall presume the factum of

dishonor of cheque on the presentation of the cheque return memo. In

the instant case at hand the complainant had produced the cheque return

memo; hence it is held that the said cheque was dishonoured due to

insufficient funds in the account of the accused.

the evidence of complainant side. So, it is held that the aforesaid cheque

/1/'" was dishonoured for insufficient funds in the account of the accused.~) NO.-'.'

SOJ Metro)Distnct,Kamrup ( tl

GuwahB POINT FOR DETERMINATION NO.3: Whether the accused received the

demand notice issued by the complainant regarding the dishonor of the

chegue?

The complainant (PW1) has deposed that he had issued the

demand notice in respect of the dishonor of the said cheque through his

advocate on 27/04/2009 by registered post. The complainant has

produced the said notice and the sam~ is marked as exhibit 3. The

complainant has further deposed that the said notice was received by the

accused on 04/05/2009. The complainant also exhibited the postal

receipts as Ext 4 (i) and Ext 4 (ii) and acknowledgement card as Ext- 5(i)

and Ext 5 (ii). Moreover the accused through his advocate sent a reply1:o

the complainant denying any Uability which is also exhibited as Ext- 6 and

signature of the advocate as Ext- 6 (i) by the complainant side. During his

evidence the accused himself admitted receiving the demand notice

issued to him and stated that he replied to it that he has nothing to pay,

he did not issue any cheque. This statement of the accused supports the

statement of Complainant that he received a written reply sent by the

accused and which the complainant exhibited as Ext- 6. But in his

statement U/S 313 CrPCthe accused denied receiving any notice. But the

demand notice was issued by the complajnant on 27/04/2009 by

~\JdiC!(?1'1? registered post which was duly received by the accused on 04/05/2009 as,.. .....) .· ~~W;~' :-.asbecome clear on perusal of the Ext- 5 (i) and 5 (ii). As per the accused

)~~J..5... ..4Ir 0.. r,~ ;"\"-;,;:.&/ ~, came to know about his lost cheque on 08/05/2009 and on that day he~~:.i·) .~

.:};~-~~s mmediately instructed the Bank to stop payment of the said cheque. Inr.•r y,~~

,~ this regard he exhibited a letter dated 08/05/2009 as Exhibit- A issued to

the Bank for the same and also exhibited his signature on the said letter

as Ext- A (1). Thus the accused before issuing the letter to the bank

authority on 08/05/2009 had the first hand knowledge of the dishonor of

cheque as he had already received the demand notice on 04/05/2009.

Though the accused denied in his evidence receiving the said notice but it

is evident from the acknowledgement card that he duly received it on

IJ /' 04/05/2009.~ t-l.? •.\ \

SO... I- \e\{o) ?\9tf\ct. There arises no ambiguity in this point. Hence I am of the view\<:a{'C\{U9 \1'J:3na\\

Gl\ that the demand notice was duly served upon the accused.

~ POINT FOR DETERMINATION NO.4: Whether the accused has committed

the offence under section 138 of the Negotiable Instruments Act, 1881?

The offence under section 138 is complete on the satisfaction

of certain conditions which are that the cheque has to be issued on the

account maintained by the accused and that the cheque has to be issued

for the discharge of a debt or liability. It is further provided that the said

cheque has to be deposited within six months of its issuance or within its

validity and that the notice regarding the dishonor of the cheque for

insufficient funds ought to be given within 30 days of the receipt of

information regarding the dishonor

In the instant case at hand it is already held that the cheque

was issued by the accused in the account maintained by him and that the

said cheque was dishonoured due to insufficient funds. The cheque was

issued in the instant case on 10/01/2009 and it was presented within six

months for encashment. The cheque was dishonoured on 17/04/2009 ;

and the demand notice was issued by the complainant on 27/04/2009 ,

which is within 30 days from the receipt of information of dishonor. The

~u'd' ; . said notice was received by the accused by regd. post A/D on 04/05/2009.~:?: ,j 1-,',;;;/ <;

j~~~!re complainant failed to pay the amount within 15 days of such receipt.

·1( ,:~~~'~~l:I J~e complainant had thereafter instituted this complaint on 05/06/2009.-' ~ •.•• ;;4' -'? .f.

';;/;:,":1 .~.</~,Nhichis within 30 days after the lapse of 15 days from the date of receipt< •••.•• -

y n '#

<i'~~ of demand notice; hence the complaint is lodged within the period of

In the backdrop of aforesaid evidence it is held that all the

ingredients of the offence under section 138 of the Negotiable

Instruments Act,1881 are satisfied in the instant case and further the

complainant has satisfied all the requisites for the case. The evidence led

~~I~Y the complainant is cogent, clear and plausible. So, the accused has

.S~f~~\M \f?l.~\ tr 6'mmitted the offence under section 138 of the Negotiable Instruments,<.8 OllWL,.I"J

Act,1881.

31. I have heard the parties. I am not inclined to extend the benefit of the

provisions of the Probation of Offenders Act,1958, because the offence

committed is in the nature of an economic offence and the backbone of

the nation depends on a healthy economy. Moreover the real intention..•

behind the enactment of the said offence is to provide quick remedy to

the payee or the holder of the cheque, and also to inspire a sense of .

32. Considering the nature of the offence and the other attending facts and

circumstances of this case, the accused Mr. Chinmoy Roy (proprietor of

MIs Roy Enterprise) is convicted under section 138 of the Negotiable

.Instruments Act,1881 and he is sentenced to undergo simple

imprisonment for six (6) months and further to pay compensation of Rs.5

lacs to be paid to the complainant as the cheque amount is Rs.3,15,306/-

and this case is pending since the year 2009 .It is further directed that the

.". ccused shall undergo simple imprisonment for another two(2) months in': !efault of the payment of compensation," ...eo m .

'~~~~~~,~r~~ • Furnish a free copy of the judgment to the accused immediately.

34. The accused is extended bail for a period of six months as per law for

Appeal as prayed for.

Given under my hand and the seal of this court on this the 4th day of

April, 2014 at Guwahati.

Sri Bankim Sarma, AJS

~,J'f

tr'SDJM(S) , amrup(M)

\ AtOJM (5, O\Stf\ct

Kamrup (M \rO) ,Guwahat\

2) EXHIBIT B- Authority letter to OW 2 to depose in court issued by the authority

of ICICI Bank.

2) Sri Nikhil Ranjan Sarma

SOJM (S) II, KAMRUP(M .•\\SOJN\ (5) ) O\~tfict.

/Metro ,Ksmrup \ ",""'ati

GuWoll