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The Supreme Court has said thay once the cheque amount, with interest and costs, as assessed by the court, is paid by the accused on a specific date, the court is entitled to close the proceedings in exercise of the powers under Section 143 of the Negotiable Instruments Act read with Section 258 of Criminal Procedure Code.

A bench of Justices B R Gavai and Sandeep Mehta allowed an appeal filed by Manoj who was sentenced to six months imprisonment under Section 138 of the NI Act with a fine of Rs five lakh.

The appellant was aggrieved of the Bombay High Court's single judge bench judgment of April 25, 2023.

The HC had affirmed the sessions Court's order of May 2, 2022 which had dismissed the trial court's order of holding him guilty and sentencing him to six months imprisonment.

The appellant, led by senior advocate Sudhanshu S Choudhari, relied upon the judgment in 'Meters and Instruments Pvt Ltd & Anr Vs Kanchan Mehta' (2018) and submitted that he has already undergone sentences of 11 days and willing to pay additional compensation to the complainant.

Through advocate Nishant R Katneshwarkar, appearing for the respondent opposed the appeal, the bench noted in the case of Meters and Instruments, it was observed that offence punishable under Section 138 of the Act is primarily a civil wrong and the burden of proof is on the accused in view of the presumption under Section 139 of the Act but the standard of such proof is “preponderance of probabilities”.

"This court has further held that, where the cheque amount, with interest and costs, as assessed by the court is paid by the accused on a specific date, the court is entitled to close the proceedings in exercise of the powers under Section 143 of the Act read with Section 258 of CrPC," the bench said.

In the case, the bench noted the appellant has undergone a sentence of 11 days. The cheque amount was Rs four lakh. The compensation awarded is Rs five lakh which has already been deposited by the appellant and withdrawn by the respondent.

"We find that the issue is squarely covered by the law laid down in Meters and Instruments case," the bench said.

The bench, therefore, directed the appellant to deposit an additional amount of Rs three lakh i.e. in total Rs eight lakh. The amount of Rs three lakh be deposited in the Trial Court within a period of three weeks.

"On such deposit, the respondents will be entitled to withdraw the same. Upon the amount being deposited, the conviction of the appellant shall stand quashed and set aside," the bench ordered.