Dismissed¶42

Adithya v. Kiran

Madras HC12 Jun 2025CRL A/594/2025

Case brief

AI extract

What is this about?

Section 138 Negotiable Instruments Act; cheque dishonoured “Payment Stopped by the Drawer”; deliberate stop payment despite sufficient balance on presentation (Ex.D32 statement of accounts); pre-existing trade dispute and counter-claim — refund of Rs.16,28,400/- at 18% interest demanded in reply notice dated 14.07.2022; acquittal under S.138 upheld as free of infirmity; appeal by complainant under Section 419(4) Bharatiya Nagarik Suraksha Sanhita, 2023 dismissed; Madras High Court; G.K. Ilanthiraiyan J.; Crl.A.No.594 of 2025; decided 12.06.2025; STC No.343 of 2022, Fast Track Court No.I, Judicial Magistrate, Coimbatore.

What did the court decide?

None; the acquittal was upheld and no infirmity or illegality was found in the judgment under challenge. ¶42

Adithya Vs Kiran — Cheque Dishonour | Madras HC (2025)

What the court decided

AI extract

Outcome

None; the acquittal was upheld and no infirmity or illegality was found in the judgment under challenge.

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Issue for consideration

Whether the judgment of acquittal dated 12.02.2025 made in STC No.343 of 2022 on the file of the Fast Track Court No.I, Judicial Magistrate, Coimbatore, acquitting the respondent of the offence under Section 138 of the Negotiable Instruments Act, suffers from any infirmity or illegality warranting being set aside.

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Court's answer

On the date of presentation of the cheque (Ex.P1), a substantial amount was available in the respondent's account to honour the cheque, as verified from the statement of accounts marked as Ex.D32; the respondent had issued a letter to stop payment on Ex.P1.

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Ratio / Principle

Per the reply notice dated 14.07.2022, the electronic goods supplied by the appellant were sold by the respondent to his customers, found defective, and returned demanding refund; the respondent alleged the appellant cheated him to the tune of Rs.16,28,400/- by supplying duplicate goods and demanded refund with interest at 18% per annum, and consequently stopped payment on the cheque. Accordingly, no offence under Section 138 of the Negotiable Instruments Act is made out against the respondent, and the Trial Court rightly acquitted him.

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Key takeaways

This Court finds no infirmity or illegality in the Judgment of acquittal dated 12.02.2025 made in STC No.343 of 2022 on the file of the Fast Track Court No.I, Judicial Magistrate, Coimbatore; accordingly, the Criminal Appeal stands dismissed.ratio¶41

Detailed headnote1 paragraphs

High Court of Judicature at Madras, Crl.A.No.594 of 2025 (decided 12.06.2025) — G.K. Ilanthiraiyan, J.: Criminal Appeal under Section 419(4) of the Bharatiya Nagarik Suraksha Sanhita, 2023 by the complainant-appellant (proprietor of SMR Electronics) seeking to set aside the acquittal dated 12.02.2025 made in STC No.343 of 2022 on the file of the Fast Track Court No.I, Judicial Magistrate, Coimbatore, whereby the respondent (proprietor of Indus Technologies) was acquitted of the offence punishable under Section 138 of the Negotiable Instruments Act. The complaint arose out of an outstanding of Rs.4,60,389/- for bulk purchases of electronic goods, discharged by a cheque (Ex.P1) that was returned dishonoured with the endorsement “Payment Stopped by the Drawer”. Reviewing the trial evidence (P.W.1, Ex.P1–P6; D.W.1, Ex.D1–D32), the Court found that on the date of presentation substantial funds stood in the respondent's account to honour Ex.P1 (statement of accounts, Ex.D32), and that the reply notice dated 14.07.2022 showed the goods, resold to customers, were returned as defective, the respondent alleging cheating to the tune of Rs.16,28,400/- and demanding refund thereof with interest at 18% per annum — whence no offence under Section 138 was made out and the Trial Court rightly acquitted. Finding no infirmity or illegality in the acquittal judgment, the Criminal Appeal stood dismissed.

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Crl.A.No.594 of 2025

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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Dated : 12.06.2025

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CORAM

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THE HONOURABLE MR. JUSTICE G.K.ILANTHIRAIYAN

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Crl.A.No.594 of 2025

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Adithya Proprietor of SMR Electronics, No.775, Oppanakara Street, Coimbatore – 641 001.

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..... Petitioner

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Kiran Proprietor of Indus Technologies, No.172/800/788, Mahalakshmi Complex, Ground Floor, 12E Main, Kaveri Nagar, Boomanahalli, Banagalore – 560 068 ..... Respondent Prayer: Criminal Appeal filed under Section 419(4) of the Bharatiya Nagarik Suraksha Sanhita, 2023, to call for the records in Judgment of acquittal dated 12.02.2025 made in STC No.343 of 2022 on the file of the Fast Track Court No.I, Judicial Magistrate, Coimbatore and set aside the same.

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For Appellant : Mr.P.Saravana Sowmiyan

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JUDGMENT

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This Criminal Appeal has been filed challenging the order dated 12.02.2025 passed in STC No.343 of 2022 on the file of the Fast Track Court No.I, Judicial Magistrate, Coimbatore, thereby acquitted the 1/6

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respondent for the offence punishable under Section 138 of the Negotiable Instruments Act.

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2. The appellant/complainant lodged a complaint against

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the respondent/accused for the offence under Section 138 of the Negotiable Instruments Act, alleging that the appellant is a sole proprietor of SMR Electronics, engaged in the business of sale of electronic components and allied materials. The respondent is the proprietor of Indus Technologies and was regularly purchasing electronic goods in bulk quantities from the appellant. The respondent used to make payments for the goods purchased at periodical intervals. However, towards the purchase of electronic goods, a sum of Rs.4,60,389/remained outstanding under the invoice. In discharge of the said liability, the respondent issued a cheque and the same was presented for collection. However, it was returned dishonoured with the endorsement “Payment Stopped by the Drawer”. After causing the statutory notice, the appellant filed a complaint under Section 138 of the Negotiable Instruments Act.

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3. On the side of the appellant, P.W.1 was examined and

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Ex.P1 to Ex.P6 were marked. On the side of the accused, D.W.1 was

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examined and Ex.D1 to D32 were marked. On perusal of the oral and documentary evidence, the Trial Court found the respondent not guilty and acquitted him of the charges under Section 138 of the Negotiable Instruments Act.

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4. The learned counsel for the appellant would submit that

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the respondent is liable to pay the dues arising out of the purchase of electronic goods under the invoices. The appellant marked the invoice dated 25.05.2022 as Ex.P5, which was issued pursuant to the purchase order placed by the respondent. In discharge of the said liability, the respondent issued a cheque. However, the respondent stopped the payment of the said cheque without assigning any valid reason. Therefore, the offence under Section 138 of the Negotiable Instruments Act is clearly made out and even then the Trial Court acquitted the respondent on the ground that the appellant failed to prove his case.

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5. Heard the learned counsel appearing for the appellant and

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perused the materials available on record.

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6. A perusal of the records reveals that though the

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respondent issued a cheque, which was marked as Ex.P1, he subsequently, issued a letter to stop payment on Ex.P1. On the date of return of the cheque, the respondent maintained substantial amount in his account to honour Ex.P1. On verifying the same, it is found that on the date of presentation of the cheque, there was a substantial amount available in the account of the respondent to honour Ex.P1. The statement of accounts was marked as Ex.D32.

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7. A perusal of the reply notice dated 14.07.2022 reveals

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that the electronic goods supplied by the appellant were sold out by the respondent to his customers. However, it is alleged that all the customers found the electronic goods to be defective and returned them, demanding a refund. Therefore, thereby the appellant had cheated the respondent to the tune of Rs.16,28,400/- by supplying duplicate goods. Consequently, the respondent stopped payment on the cheque issued to the appellant. Further, the respondent, in his reply notice, called upon the appellant to refund a sum of Rs.16,28,400/- with interest at the rate of 18% per annum. Therefore, no offence under Section 138 of the Negotiable Instruments Act is made out against the respondent herein. Hence, the Trial Court rightly acquitted the respondent of the offence under Section

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138 of the Negotiable Instruments Act.

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8. In view of the above, this Court finds no infirmity or

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illegality in the Judgment of acquittal dated 12.02.2025 made in STC No.343 of 2022 on the file of the Fast Track Court No.I, Judicial Magistrate, Coimbatore.

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9. Accordingly, this Criminal Appeal stands dismissed.

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12.06.2025

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Index : Yes/No Neutral citation : Yes/No Speaking/non-speaking order Lpp

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