Legal Question in Criminal Law in India
We own a chemist shop as part of a hospital. We gave cheque worth Rs. 5 lakhs PDC to a supplier of medicines as advance payment for supplying a medical equipment for the hospital which is owned by one of our relatives. After 2 days, he stopped taking our calls and we complained to police and gave instructions to bank to stop cheque.
He presented the cheques on the cheque date and they were returned due to our stop payment. Now he filed case under Sec 138 in court and case is going on since 2005. He produced fake invoices to the tune of 5 lakhs and claims that the cheques were issued as advance payment for supply of these medicines.
Please advise us taking into account following points :
a) police was informed and cheque was stopped by us before date of cheque
b) bills produced by him do not carry any delivery acknowledgement from us as the medicines were never delivered. Also, each valid medicine bill needs to carry batch no. and expiry of medicines which is not there on the bill
c) date on bill is after the date of stop payment on the cheques
d) Bank manager is ready to give evidence that we had necessary arrangements to clear the amount
e) Hospital owner is ready to give evidence that indeed the advance was given for purchase of equipment
What are our chances of winning this case ?
5 Answers from Attorneys
As PDCs were given towards advance payment for purchase, you cannot win the case.
Please advise the conditions of payment, delivery schedule etc. mentioned in the contract.
You have to justify yur action of stop payment by establishing that supplier has failed to
observe the terms of contract & thus has lost his right of gtg. advance payment
You have got bright chances of winning this case. As per the latest Supreme Court's decision, only under 2 circumstances, ie., (1) when there was not sufficient funds in the account, (2) When the arrangement with the bankers exceed the limit set, the liability of the drawer of the cheque prevails. In your case, you have mentioned that 'stop payment' was issued and also the police were informed (u must get written proof of these). Further more, you have mentioned all your defence evidences which are vital to the case. Go ahead confidently.
you have a strong case. the initial burden that the cheque is issued in discharge of legaly recoverable debt is on the Complainant. He has to prove the same strictly. You have to put up a probable defence. your defence looks probable. cross examine the Complainant properly. if you had balance in the account produce the account extract to the court. since the transaction itself is in dispute, the Complainant has to prove the same as per the latest judgment of the Supreme court in Krishna Janardhan Bhat case. [email protected]
apart from 138, u could also have filed a civil suit u/o 37 of civil procedure code. the civil suit is required to be filed to recover the money and 138 would simply handover the punishment for bouncing of the cheque and may or not fine the accused. moreover, the contentions of both the parties would be addressed before the civil court and are binding upon criminal courts.
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