The main legal point established in the judgment is the application of Section 138 of the Negotiable Instruments Act in determining the liability of the accused for dishonour of cheques.

The brief facts of the case are as follows:-

The respondent herein / complainant had initiated a case in C.C.No.1056 of 2004, on the file of Judicial Magistrate Court-I, Salem against the revision petitioner herein / accused stating that the accused had introduced one Salim, who is the proprietor of "Star Marketing Consultants", Chennai, regarding a business deal towards the supply of Raybon Sun Glasses, 6000 in numbers; towards this business transaction, as part payment, the complainant has paid a sum of Rs.8,10,000/- by way of demand draft to the said Salim. The said Salim had issued a receipt on 30.09.2003 under the assurance that the materials would be delivered on or before 10.01.2004.

2. As the materials were not supplied to the complainant, the accused being a guarantor to the said Salim had issued three cheques for a sum of Rs.5,00,000/-, Rs.3,00,000/-and Rs.50,000/- respectively. All the three cheques were presented by the complainant with his bankers viz., Indian Overseas bank, Salem and the cheques were returned with an endorsement of "insufficient funds". Thereafter, the complainant had observed all necessary formalities and filed the above case for punishing the accused under Section 138 of Negotiable Instruments Act.

3. On the side of the complainant, he had been examined as P.W.1 and he had marked 12 documents viz., Ex.P1- copy of demand draft for Rs.8,10,000/-, Ex.P2-cheque for a sum of Rs.5,00,000/-, Ex.P3-cheque for a sum of Rs.3,00,000/-, Ex.P4-cheque for a sum of Rs.50,000/-, Exs.P5 to P7-return memo, Ex.P8-debit advice, Ex.P9-lawyer's notice, Ex.P10-acknowledgment card, Ex.P11-reply notice and Ex.P12-company registration certificate. On the side of the accused, no witness was examined and Ex.R1 had been marked for payment of Rs.7,50,000/-.

4. P.W.1 had adduced evidence stating that he is the partner of the firm; that he knows the accused from his childhood; that the accused had introduced one Salim to him; that the said Salim had agreed to supply "Raybon Glasses", 6000 in numbers to his firm; that he had paid a sum of Rs.8,10,000/-to the said Salim; by way of demand draft; that after receipt of the demand draft, the said Salim had not supplied the said goods. Therefore, the accused, being a guarantor, had issued three cheques for a sum of Rs.5,00,000/- dated 23.02.2004, Rs.3,00,000/- dated 10.03.2004, Rs.50,000/-dated 20.02.2004. P.W.1 further stated that all the three cheques had been presented by him with his bankers viz., Indian Overseas Bank, Salem Branch but all the cheques were returned unpaid. The dishonoured cheques had been marked as Exs.P2, P3 and P4 and the demand draft had been marked as Ex.P1. The return memos were marked as Exs.P5, P6 and P7 and the debit advice was marked as Ex.P8. Advocate notice was marked as Ex.P9; acknowledgment card was marked as Ex.P10.

5. On considering the evidence of the complainant and on perusing the exhibits marked by both the parties and on hearing the arguments of the learned counsels on either side, the learned Magistrate has held that the accused had admitted that he had issued the cheques after duly signing it, as guarantor. Therefore, the learned Magistrate held the accused guilty of offence under Section 138 of Negotiable Instruments Act, and sentenced him to undergo simple imprisonment for one year and also imposed a fine of Rs.15,00,000/- in default, the accused was to undergo a further period of simple imprisonment for a period of two months.

6. Against the conviction and sentence passed in C.C.No.1056 of 2004, on the file of Judicial Magistrate Court-I, Salem, the appeal in C.A.No.121 of 2006 on the file of the Principal Sessions Court, Salem, had been filed by the accused. The learned judge, after hearing the arguments of the learned counsels on either side, and on perusing the impugned judgment of the trial Court, dismissed the appeal. The learned judge had observed that the accused had not denied the complainant's contention regarding