IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO. 306 OF 2016

(Arising out of SLP (Criminal) No. 1587 of 2013)

B.M. BASAVARAJ ... Appellant

VERSUS

SRINIVAS S. DATTA ... Respondent

O R D E R

Leave granted.

We have heard learned counsel for the parties at

length.

The appellant herein had filed a complaint under

Section 138 of the Negotiable Instruments Act, 1881,

(hereinafter referred to as 'Act'), inter alia, alleging

therien that it had entered into a contract with the

respondent herein as per which the appellant was to supply

some material for the completion of certain project which

was undertaken by the respondent. It was further stated

that the respondent was supposed to make payment in terms of

the said agreement as under: -

“Payment

1.

Rs. 25,000.00 at the time of release of Purchase

Order

2. Rs. 25,000.00 at the time of Board Level

Demonstration.

3. Rs. 25,000.00 at the time of Road Triais.

4. Rs. 50,000.00 at the time of supply of units.

5. Balance Rs. 50,000.00 plus the taxes applicable

1

Digitally signed by

NIDHI AHUJA

Date: 2016.04.13

05:47:05 IST

Reason:

Signature Not Verified

Crl.A. 306/2016

@ SLP (Crl.) No. 1587/2013

within 45 days from the date of supply of units.

We hereby agree by the above payment terms

signed by the petitioner and respondent.”

According to the appellant, it had made the requisite

supplies and pursuant thereto, the respondent had issued two

cheques dated 20.11.2003 and 30.11.2003 for Rs.25,000/-

each.

Those cheques were returned dishonoured on

presentation with the remarks 'Insufficient Funds'. When

the respondent was informed about the same, he issued

cheques for Rs. 50,000/- and 75,000/-, which was the amount

due for the work undertaken and completed by the appellant

for the respondent, as under: -

(1) Cheque No. 795553 dated 22.11.2004 for Rs.50,000/-

drawn on Canara Bank.

(2) Cheque No. 795554 dated 15.12.2004 for Rs.75,000/-

drawn on Canara Bank.

Both the cheques were again returned by the Bank

uncleared with the endorsement 'Insufficient Funds'.

The appellant thereupon issued legal notice dated

18.12.2004 to the respondent in which, inter alia, the

following averments were made: -

“You are also aware of the fact that as per the said

agreement my client has already supplied all the

units to you and in acceptance of the said units you

have issued the following cheques in favour of my

client towards the payment of balance amounts.”

xxxxx

“Believing your words my client has presented the

2

Crl.A. 306/2016

@ SLP (Crl.) No. 1587/2013

following cheques.

Sl.No. Cheque No.

Cheque Date

Amount in Rs.

5.

795553

22^nd Nov 2004

50,000=00

6.

795554

15^th Dec 2004

75,000=00

and both the cheques were returned by the bank, Canara Bank,

Sarakki Layout Branch, Bangalore stating the reason as

INSUFFICIENT FUNDS as per the endorsement i.e. memorandum of

cheques unpaid, dated 10.12.2004 and 16.12.2004

respectively.

Thus you have committed an offence under Section 138 of the

Negotiable Instruments Act read with section 420 of the IPC.

And hence I hereby issue the following;

You hereby take this notice that the cheques issued by you

in favour of my client dated 22.12.2004 and 15.12.2004

bearing number 795553 and 795554 respectively, towards the

payment of balance amount i.e. Rs.1,25,000=00 (Rupees One

lakh twenty five thousand) towards the design and

development of AVL Units with Base Station Unit supplied to

you.”

Pertinently no reply was given to these notices by the

respondent which forced the appellant to file the aforesaid

complaint under Section 138 of the Act.

The trial court, after recording the evidences of both

the parties in the said complaint, dismissed the complaint

primarily on the ground that the appellant had not furnished

any document