CRL R.C.No.548 of 2022

IN THE HIGH COURT OF JUDICATURE AT MADRAS

RESERVED ON : 20.11.2025

DELIVERED ON : 25.02.2026

CORAM

THE HONOURABLE MR JUSTICE M. NIRMAL KUMAR

CRL RC No. 548 of 2022

N.Narayanan

Ex-Director,

Pyramid Saimira Theatre Limited,

No.6, 1

st

Floor, Viswakamal,

245, R.K.Mutt Road, Mylapore,

Chennai – 600 004.

Petitioner(s)/A3

Vs

Axis Bank Limited

Rep by its Authorised Signatory,

Having Office at

1

st

Floor, Karumuthu Nilayam,

No.192, Annasalai,

Chennai – 600 002.

Respondent(s)/Complainant

PRAYER: Criminal Revision Case filed under Section 397 r/w 401 of

Cr.P.C., praying to set aside the judgment dated 27.08.2021 passed in

Crl.A.No.286 of 2019 on the file of the learned XVI Additional District and

Sessions Court, Chennai, partly allowed the judgment dated 27.04.2019

passed in C.C.No.2840 of 2010 on the file of the learned Metropolitan

Magistrate Court, (Fast Track Court No.2), Egmore at Allikulam, Chennai.

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CRL R.C.No.548 of 2022

For Petitioner :Mr.R.Sagadevan

For Respondent(s):Mr.R.Sreedhar

O R D E R

The petitioner/A3 in C.C.No.2840 of 2010 was convicted by the trial

Court along with two others, by judgment dated 27.04.2019 for offence under

Section 138 of the Negotiable Instruments Act ('N.I. Act') and sentenced the

petitioner to undergo six months simple imprisonment and directed all the

accused jointly or severally to pay compensation to pay a sum of

Rs.80,00,000/- as compensation, in default, to undergo further period of two

weeks simple imprisonment. Aggrieved against the same, the petitioner/A3

preferred an appeal before the XVI Additional Sessions Judge, Chennai in

Crl.A.No.286 of 2019. The learned Sessions Judge, by judgment dated

27.08.2021, partly allowed the appeal by modifying the simple imprisonment

of six months to three months, against which, the present revision filed.

2.The complaint against the petitioner is that the respondent is a

Banking Company. The first accused, M/s.Pyramad Saimira Theatre Ltd.,

represented by the second accused, P.S.Saminathan and petitioner as

Directors of the first accused-company. The petitioner and other Director/A2,

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CRL R.C.No.548 of 2022

who are looking after the day-to-day business of the company, approached

the respondent-Bank and requested to grant Cash Credit Facility to the tune

of Rs.25 Crores and by way of sanctioned letters dated 04.11.2008,

13.11.2008 and 22.09.2009, the amount was sanctioned. Out of Rs.25 Crores,

the petitioner’s company availed the facility to the tune of Rs.12.5 Crores.

Thereafter, there was no repayment and there was an overdue of

Rs.13,50,15,975.54. The respondent-Bank requested to clear the over dues

and the accused company issued cheque bearing No.352940 dated 29.09.2009

drawn on Corporation Bank, Mylapore Branch for a sum of Rs.40,00,000/-.

When the cheque was presented for realisation on 06.10.2009, the same was

returned for the reason ‘Funds Insufficient’. On 15.10.2009, statutory notice

issued. The petitioner and other accused neither paid the cheque amount nor

sent any reply. Thereafter complaint filed.

3.During trial, on the side of the complainant, PW1 and PW2 examined

and Exs.P1 to P5 marked, viz., Ex.P1-Authorisation dated 22.06.2012,

Ex.P2-Cheque dated 29.09.2009, Ex.P3-Bank return memo dated 06.10.2009,

Ex.P4/Statutory notice dated 15.10.2009 and Ex.P5-Reply notice dated

28.10.2009. On the side of the defence, one V.Santhanam examined as DW1

and Exs.D1 and D2 marked. On conclusion of trial, the trial Court convicted

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CRL R.C.No.548 of 2022

the petitioner and others and the Lower Appellate Court modified the

sentence as stated above.

4.The contention of the learned counsel for petitioner is that

A1-company was sanctioned with Cash Credit Facility for a loan amount of

Rs.25 Crores and the A1-company availed loan facility only to a sum of

Rs.12.5 Crores. The cheque/Ex.P2 in this case not issued by the A1-company

in discharge of loan liability as claimed by the respondent-bank. Further, as

on 29.09.2009, there was no liability to the petitioner and other accused to

pay the cheque amount. A1-company was under a financial crisis and there

was income tax issues at the relevant point of time. The Income Tax

Department attached bank account of A1-company, hence, the Directors of

the company were unable to answer for notice. Further, A1-company under

liquidation even prior to the date of the cheque. Ex.P2 is dated 29.09.2009

and the same dishonoured on 06.10.2009, which are prior to the appointment

of Official Liquidator for A1-company. For the dishonour of the cheque, it is

the Official Liquidator, who ought to have been made as a party in this case.

5.The learned counsel further submitted that the petitioner is only a

second signatory. A2/Swaminathan is the Managing Director, who was

running the business of Al-Company and the petitioner has no role in the day-

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CRL R.C.No.548 of 2022

to-day affairs of Al-Company. Now Al-Company is under liquidation and A2

is no more. The petitioner and other accused denied the issuance of cheque

for discharge of any liability. The cheque/Ex.P2 issued only for the purpose

of paying processing fee for availing the balance loan from the sanctioned

cash credit facility. He further referred to the order passed by this Court on

09.01.2025, which is as follows:

“1.Mr.R.Sagadevan, the learned counsel for the Revision

Petitioner submits that in compliance of the order dated,

27.04.2022, an amount of Rs.6 lakhs had already been deposited

before the Trial Court by way of a demand draft bearing

No.754225, dated 15.06.2022 and a copy of the said demand draft

is produced before this Court today and it is taken on record.

2. The learned counsel for the Revision Petitioner submits

that out of Rs.40 lakhs, a sum of Rs.14 lakhs had already been

paid to the Respondent in various instalments and a sum of Rs.6

lakhs had already been deposited before the Trial Court and thus,

a sum of Rs.20 lakhs has been paid to the Respondent. He further

submits that the Revision Petitioner is willing to pay the

remaining sum of Rs.20 lakhs in two instalments and that the first

instalment of Rs.10 lakhs will be paid to the Respondent on

30.01.2025 by way of a demand draft in the name of the

Respondent, namely, Axis Bank Limited and insofar as the

remaining second instalment of Rs.10 lakhs is concerned, the

Revision Petitioner will pay the same on 27.02.2025.

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CRL R.C.No.548 of 2022

3.Mr.R.Sreedhar, the learned counsel for the Respondent

assisted by Ms.N.Fiza Nawab and Mr.L.Ahamed Hameem, submits

that the Respondent has no objection if the Revision Petitioner

pays the balance amount in two instalments as assured by the

learned counsel for the Revision Petitioner.

4. Both the learned counsel for the parties submits that the

matter may be compounded as per Section 147 of the Negotiable

Instruments Act.

5. The learned counsel for the Respondent submits that the

Respondent has no objection if the court passes a final order and

dispose of the matter if the entire amount is paid to the

Respondent as per the assurance given by the learned counsel for

the Revision Petitioner.

6.Accordingly, as prayed for by the learned counsel for the

parties, put up the case on 30.01.2025 for orders before this

Court."

6.The learned counsel further referred to the ground Nos.(c), (d) and

(e) and submitted that A1/ Pyramad Saimira Theatre Limited was under

liquidation from 18.06.2009 and this Court appointed Official Liquidator for

Al-Company. Thereafter, the Directors of the Company were ceased of their

Directorship. He further submitted that the High Court by order dated

03.09.2010 in various company Petitions in C.P.Nos.281/2009, 104/2009,

286/2009, 286/2010 and 145/2010 directed the Official Liquidator attached to

the High Court to take charge of the assets of Al-Company. On 09.09.2010

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CRL R.C.No.548 of 2022

the Official Liquidator taken the possession of assets of the Company. The

business operations of the Company have been brought to a standstill and the

petitioner and others ceased to be Directors of Al-Company. The loan facility

is for the purpose of business needs. He further submitted that the petitioner

examined DW1 who deposed that the cheque amount of Rs.40 lakhs is for

future performance and the complainant Bank to deposit the cheque after

disbursing the balance Cash Credit Facility of Rs.12.5 Crores. He further

referred to the reply notice/Ex.P5 dated 28.10.2009 issued by Al-Company

confirming the understanding with Axis Bank that they would present the

Cheque of Rs.40 lakhs after release of cash credit of Rs.12.5 Crores. Since

the Company gone under liquidation, the business came to standstill and

further release of Rs.12.5 Crores was not granted and for other dues of the

Company, it is for the Bank to take appropriate steps with the Official

Liquidator to realize their dues.

7.The learned counsel for the respondent-bank submitted that

A1-company and other accused admitted that there was a loan due of

Rs.13,50,15,975.54 as on the date of issuance of Ex.P2. The petitioner also

admitted the issuance of Ex.P2 to the respondent bank. Since the issuance of

cheque was admitted by the petitioner, the statutory presumption drawn in

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CRL R.C.No.548 of 2022

favour of the respondent. Though the petitioner stated that cheque/Ex.P2

issued for the purpose of paying processing fee, they failed to prove the same.

Though DW1 examined and deposed that the cheque was issued by the

A1-company for the purpose of processing fee, his evidence not reliable,

DW1 interested witness, former employee of A1-company. DW1 in his cross

examination deposed that the petitioner not discussed with him prior to

issuance of Ex.P2. Thus, the petitioner not proved Ex.P2 issued only for the

purpose of paying processing fee and thus petitioner miserably failed to prove

their defence and failed to rebut presumption. In this case, the petitioner

admitting the outstanding and their liability to pay to the respondent bank all

proved and the trial Court rightly convicted the petitioner and other accused.

8.The learned counsel for respondent further submitted that the cheque

is of the year 2009. The Trial Court convicted the petitioner and other

accused on 27.04.2019 sentencing A2 & A3 to undergo six months simple

imprisonment and to pay Rs.80 lakhs which is double the cheque amount of

Rs.40 lakhs, as compensation. Aggrieved against the same, the petitioner filed

an appeal before the Sessions Court in C.A.No.286 of 2019. The learned

Sessions Judge, by judgment dated 27.08.2021, partly allowed the appeal and

modified the sentence to three months simple imprisonment and with regard

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to the compensation amount, the same was confirmed, against which the

present revision filed. He further submitted that the respondent is a Bank and

Al Company/Pyramad Saimira Theatre Limited was sanctioned cash credit

facility to an extent of Rs.25 Crores. Al-Company availed loan to an extent of

Rs.12.5 Crores but failed to pay interest and there was an outstanding due to

the tune of Rs.13,50,15,975.54 and the remaining credit facility was not

disbursed. Thereafter A1-Company issued the cheque/Ex.P2 in discharge of

the part liability, since they repaid the loan amount already availed. The

cheque was signed by A2/Swaminathan and the petitioner/A3. He further

submitted that though all the three accused convicted, petitioner/A3 alone

preferred an appeal and in the meanwhile, A2 died. Al Company is

represented by A2. Now the cheque amount of Rs.40 lakhs paid but the other

outstandings running to Crores not paid. Hence, he has got strong objection

for considering the petitioner's plea of compounding the offence and forcing

the respondent Bank to file a petition under Section 147 of NI Act.

9.The learned counsel for petitioner submitted that in view of the

understanding reached on 09.01.2025, the learned counsel persuaded the

petitioner to mobilize funds and to pay the cheque amount and now the

cheque amount of Rs.40 lakhs paid, which is not disputed and the petitioner

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CRL R.C.No.548 of 2022

has no objection for the respondent to withdraw the amount. He further

submitted that in the Trial Court though compensation was ordered double

the cheque amount, neither the respondent substantiated reason for imposing

compensation nor the Trial Court discussed anything justifying imposition of

compensation, that too, double the cheque amount. He further submitted that

if at all there is any compensation, it has to be paid by the A1-Company and

the Managing Director and not the petitioner who is only a second signatory.

10.Considering the submissions made and on perusal of the material, it

is seen that the Lower Appellate Court in its judgment at paragraph 20 had

recorded the payment of Rs.14,00,000/- before the Lok Adalat, which reads

as follows:

(i) Demand Draft No.555283 dated 10.06.2011 for

Rs.1,00,000/- drawn on Corporation Bank, Chennai George Town

Branch paid on 10.06.2011, (ii) Demand Draft dated 05.08.2011

for Rs.6,00,000/- paid on 05.08.2011, (iii) Demand Draft

No.546440 dated 09.09.2011 for Rs.2,00,000/- drawn on

Corporation Bank, Chennai George Town Branch paid on

09.09.2011, (iv) Demand Draft dated 06.01.2012 for Rs.3,00,000/-

drawn on Lakshmi Vilas Bank, Nungambakkam Branch paid on

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06.01.2012 and (v) Demand Draft No.34382 dated 30.03.2012 for

Rs.2,00,000/- drawn on Lakshmi Vilas Bank, Nungambakkam

Branch paid on 30.03.2012.

11.Thereafter, on 15.06.2022, the petitioner deposited a sum of

Rs.6,00,000/- before the trial Court and the same is extracted hereunder:

12.Thereafter, on 28.01.2025, the petitioner paid a sum of

Rs.5,00,000/- by way of Demand Draft and the same is extracted hereunder:

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13.Thereafter, on 21.02.2025, the petitioner paid a sum of

Rs.5,00,000/- by way of Demand Draft and the same is extracted hereunder:

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14. Lastly, on 03.04.2025, the petitioner paid a sum of Rs.10,00,000/-

by way of Demand Draft and the same is extracted hereunder

15. In this case, A1-company is under liquidation with the Official

Liquidator and A2 is no more and the petitioner/A3 a Director and second

signatory to the cheque. In this case, a sum of Rs.14,00,000/- paid during

mediation proceedings and Rs.6,00,000/- deposited before the trial Court and

three demand drafts for Rs.20,00,000/- handed over to the respondent-bank,

who acknowledged the same. Thus, the petitioner/accused paid the entire

cheque amount of Rs.40,00,000/-, which is not in dispute.

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16. Despite the A1-company is in distress, the entire cheque amount

has been paid. Recording the same, this Court, invoking inherent jurisdiction

under Section 482 of Cr.P.C., inclined to set aside the conviction of the

petitioner.

17. In view of the same, the conviction and sentence imposed on the

petitioner vide judgment dated 27.08.2021 made in Crl.A.No.286 of 2019 by

the XVI Additional Sessions Judge, Chennai, modifying the sentence passed

in C.C.No.2840 of 2010 dated 27.04.2019 by the Metropolitan Magistrate

Court, (Fast Track Court No.2), Egmore at Allikulam, Chennai, is set aside

and the revision petitioner is acquitted from the charges for offence under

Section 138 of the Negotiable Instruments Act.

18. It is made clear that if there is any amount deposited by the

petitioner/accused is still lying in the credit of C.C.No.2840 of 2010, the

respondent/complainant can withdraw the amount by filing appropriate

petition/Memo before the trial Court along with this order copy and the trial

Court to return the amount along with interest if any, if it is lying in the credit

of C.C.No.2840 of 2010, to the respondent/complainant dispensing notice to

the petitioner/accused.

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19. In the result, the Criminal Revision Case is allowed.

25.02.2026

Index: Yes / No

Neutral citation : Yes / No

Internet : Yes/No

Speaking / Non-speaking order

rsi

To

1.The XVI Additional Sessions Judge,

Chennai.

2.The Metropolitan Magistrate,

(Fast Track Court No.2),

Egmore at Allikulam, Chennai.

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CRL R.C.No.548 of 2022

M.NIRMAL KUMAR, J.

rsi

Pre-delivery Order in

CRL R.C.No. 548 of 2022

25.02.2026

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