IMPORTANT POINT
Where the amount covered by cheque remained unpaid it should be the outlook of trial Magistrate that sentence for offence under Section 138 NI Act should be of such nature as to give proper effect to the object of legislation.

S. Ashok Kumar, J.—This Criminal Revision case has been filed by the complainant against the Order of the learned Judicial Magistrate-I, Cuddalore for enhancement of sentence and for compensation.

2. The brief facts of the case are as follows:

(a) The accused borrowed Rs. 75,000 from the complainant and issued two cheques Exs. P1 and P4, dated 27.11.1998 and 21.5.1999 for Rs. 25,000 and Rs. 50,000 respectively. When the cheques were presented, both the cheques bounced and returned with a memo for insufficient funds. The return memos are marked as Exs. P2 and P3. Therefore on 7.6.1999, the complainant caused lawyer’s notice on the accused which are marked as Exs. P5 and P6. The acknowledgment card containing the signature of the accused are Exs. P7 and P8.

(b) In the reply notice, the accused though contended that he did not receive any money from the complainant, but he admitted that he borrowed a sum of Rs. 4,000 from one Thandapani to meet the marriage expenses of his daughter and at that time he has signed two promissory notes and two blank cheques which were handed over to Thandapani and one of those cheques has been used by the complainant at the instance of Thandapani. Even in the reply notice the accused has not stated that the amount has been paid to Thandapani.

3. On behalf of the complainant, P.Ws. 1 to P.W. 3 were examined and Exs. P1 to P9 were marked. On behalf of the accused, no witness was examined and no document was marked. On conclusion of trial and considering the oral and documentary evidence, the learned Judicial Magistrate came to the conclusion that the offence alleged against the accused under Section 138 of the Negotiable Instruments Act is proved and therefore convicted and imposed the sentence of three months simple imprisonment and also to pay a fine of Rs. 5,000 in default to undergo simple imprisonment for 20 days.

4. Learned counsel for the revision petitioner/complainant would contend that the learned Judicial Magistrate has failed to pass an Order directing the accused to pay compensation amount at least equal to that of the amount as mentioned in the cheque. In support of his contention, learned counsel for the revision petitioner pressed into service the Judgment of the Hon’ble Supreme Court in Suganthi Suresh Kumar v. Jagdeeshan1, wherein Their Lordships have held as follows:

“12. The total amount covered by the cheques involved in the present two cases was Rs. 4,50,000. There is no case for the respondent that the said amount had been paid either during the pendency of the case before the Trial Court or revision before the High Court or this Court. If the amounts had been paid to the complainant there perhaps would have been justification for imposing a flea-bite sentence as had been chosen by the Trial Court. But in the case where the amount covered by the cheque remained unpaid it should be the lookout of the trial Magistrates that the sentence for the offence under Section 138 should be of such a nature as to give proper effect to the object of the legislation. No drawer of the cheque can be allowed to take dishonour of the cheque issued by him light-heartedly. The very object of enactment of provisions like Section 138 of the Act would stand defeated if the sentence is of the nature passed by the trial Magistrate. It is a different matter if the accused paid the amount at least during the pendency of the case.”

5. In M/s. C.R. Engineering and Constructions (P) Ltd. v. M/s. Mesco Kalinga Steels Ltd.2 this Court held as follows:

“17. The first accused is a company and accused 2 to 4 are the Directors of the company. Learned Counsel for the accused stated that the punishment can be imposed depending upon the nature of the offence and ability to pay the fine amount or compensation amount. It is seen from Section 138 of N.I. Act that the punishment prescribed is imprisonment for a term which may extend to one year or with fine which may extent to twice the amount of the cheque, or wit