LexM/S S.S. PRODUCTION AND ANR. P1: M/S S. S. PRODUCTION P2: TR. S. SUBBIAH versus TR. PAVITHRAN PRASANTH
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[2024] 10 S.C.R. 2248 : 2024 INSC 1059 M/s S.S. Production and Anr. P1: M/s S. S. Production P2: TR. S. Subbiah v. TR. Pavithran Prasanth (Special Leave Petition (Criminal) No(s). 13981-13985 of 2024) 01 October 2024 [Sudhanshu Dhulia and Ahsanuddin Amanullah,* JJ.] Issue for Consideration Issue arose as to whether the courts below were justified in convicting the petitioners u/s.138 of the Negotiable Instruments Act, 1881 for dishonour of cheques and sentencing them to six months of simple imprisonment and to pay the cheque amounts as compensation, in each of the complaints. Headnotes Negotiable Instruments Act, 1881 – ss.138, 139 – Dishonour of cheque for insufficiency of funds – Petitioners borrowed certain sum in five instalments as a hand loan from the complainant and promised to repay the same on demand with interest – Issuance of five cheques in order to discharge the liability but the same got dishonoured on being presented by the complainant, with the endorsement ‘funds insufficient’ – Five complaints in respect of the five dishonoured cheques against the petitioners – Case of the petitioners that money was given to them in the course of producing a film jointly by the complainant and the petitioners and since the film failed, the cheques and receipts given by the petitioners were misused by the complainant – Trial court convicted the petitioners u/s.138 and sentenced them to six months of simple imprisonment and to pay the cheque amounts as compensation, in each of the complaints – Said order upheld by the courts below – Interference: * Author [2025] 4 S.C.R. 2249 State (NCT) of Delhi v. Rajeev Sharma Held: Not called for – Reasoning of the courts below is sound that evidence had to be adduced by the petitioners that the said amounts were given for producing a film and were not by way of return of any loan taken, which was not done – Just by taking a counter-stand to raise a probable defence would not shift the onus on the complainant in such a case for the plea of defence has to be buttressed by evidence, either oral or documentary – Liability has to be discharged by the person concerned and that would be a legally enforceable debt repayable, under the purview of s.138 – If the amount were by way of investments in a film being jointly produced, the need per se to issue cheques, including interest would not have arisen at all, which has not been explained by the petitioners at all – Onus to first prove as to how the amount that is said to have been given by the complainant to the petitioners could have been given, would not be fatal as receipt of the amount has not been denied, much less disputed by the petitioners – No error in the High Court opining that in view of the denial by the General Power of Attorney holder of the complainant with regard to any joint deal/venture with the petitioners in film production, the onus would not shift on the complainant and would remain on the petitioners to prove that such receipt of money was not with regard to repayment of an amount legally due to the complainant – Accused have not been able to dislodge the statutory presumption u/s.139 – Exercising the judicial discretion, it is directed that the sentences of imprisonment awarded in each complaints, would run concurrently. [Paras 8-14] Case Law Cited Tedhi Singh v. Narayan Dass Mahant [2022] 4 SCR 442 : (2022) 6 SCC 735; Rajesh Jain v. Ajay Singh [2023] 13 SCR 788 : (2023) 10 SCC 148; Rafiq v. State of Uttar Pradesh [1981] 1 SCR 402 : (1980) 4 SCC 262; Mohd. Akhtar Hussain v. Assistant Collector of Customs (Prevention) [1988] Supp. 2 SCR 747 : (1988) 4 SCC 183; V K Bansal v. State of Haryana [2013] 7 SCR 617 : (2013) 7 SCC 211; O M Cherian v. State of Kerala (2015) 2 SCC 501 – referred to. List of Acts Negotiable Instruments Act, 1881. 2250 [2025] 4 S.C.R. Digital Supreme Court Reports List of Keywords s.138 of the Negotiable Instruments Act, 1881; Dishonour of cheques; Pay the cheque amounts as compensation; Dishonour of cheque for insufficiency of funds; Discharge the liability; Endorsement ‘funds insufficient’; Capacity of complainant u/s.138 NI Act; Statutory presumption u/s.139 NI Act; Onus to prove amount legally due; Six months of simple imprisonment; Legally enforceable debt; Statutory presumption; Sentences to run concurrently; Judicial discretion. Case Arising From CRIMINAL APPELLATE JURISDICTION: Special Leave Petition (Criminal) Nos. 139
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