The Supreme Court of India has restored the conviction of an accused in a cheque dishonour case under Section 138 of the Negotiable Instruments Act (NI Act), while simultaneously issuing comprehensive guidelines to address the massive backlog of cheque bounce cases across the country.
The judgment came in the case of Sanjabij Tari vs. Kishore S. Borcar & Anr. (Criminal Appeal No. 1755 of 2010), where the apex court set aside the Bombay High Court’s 2009 ex-parte acquittal of the accused and reinstated the concurrent findings of the trial and sessions courts, which had convicted the accused.
The appellant, Sanjabij Tari, alleged that he had advanced a friendly loan of ₹6 lakh to the accused, against which a cheque was issued but later dishonoured due to insufficient funds.
Both courts upheld Tari’s claim, convicting the accused under Section 138 of the NI Act.
In 2009, the Bombay High Court at Goa acquitted the accused in revision, citing doubts over the complainant’s financial capacity.
Supreme Court Ruling: Justice Manmohan and Justice N.V. Anjaria held that once the execution of a cheque is admitted, presumptions under Sections 118 and 139 of the NI Act arise in favour of the complainant. The accused had failed to rebut this presumption with credible evidence.
The Court directed the accused to pay ₹7.5 lakh in 15 monthly instalments of ₹50,000 each to the complainant.
Financial Capacity Not Proven by Accused: The defence of “financial incapacity” of the complainant was dismissed as the accused failed to produce independent evidence.
Blank Cheque Defence Rejected: The Court termed the accused’s claim of issuing a blank cheque to enable the complainant to obtain a bank loan as “unbelievable and absurd.”
Revisional Powers of High Court: The apex court reaffirmed that revisional jurisdiction cannot upset concurrent factual findings unless there is “perversity.”
Cheque Bounce Backlog: Grim Statistics
The Supreme Court expressed deep concern over the pendency of Section 138 NI Act cases:
- Delhi District Courts: 6,50,283 pending cases (49.45% of trial court backlog)
- Mumbai District Courts: 1,17,190 pending cases
- Calcutta District Courts: 2,65,985 pending cases
“This pendency is putting an unprecedented strain on the judicial system,” the bench of Justice Manmohan and Justice N.V. Anjaria observed.
New Guidelines Issued by Supreme Court
To expedite cheque dishonour cases, the Court issued far-reaching directives, effective from November 1, 2025:
- Service of Summons:
To be effected not only through regular modes but also electronically (email, WhatsApp, SMS). Complainants must provide verified contact details of the accused at the time of filing.
- Online Settlement Mechanism:
Courts to set up QR code/UPI-based online payment facilities for accused to directly pay cheque amounts at the initial stage.
- Mandatory Complaint Synopsis:
Every complaint must include a structured synopsis detailing cheque particulars, dishonour memo, notice details, and relief sought.
- Streamlined Cognizance:
No requirement for summons before cognizance under BNSS, 2023.
- Early Compounding of Offence:
If cheque amount is paid before defence evidence, no penalty. Penalties of 5%, 7.5%, and 10% apply for later compounding at trial court, appellate courts, and Supreme Court, respectively.
- Dashboard & Monitoring:
District Judges in Delhi, Mumbai, and Kolkata must maintain dashboards tracking pendency, adjournments, and disposal rates. High Courts to form committees for monthly reviews and promote mediation and Lok Adalats for cheque cases.
The Court emphasised that Section 138 cases are quasi-criminal in nature—essentially civil disputes dressed in criminal proceedings. The objective is to ensure financial discipline and credibility of cheques, not retribution.
Case Details
Case Title: Sanjabij Tari Versus Kishore S. Borcar & Anr.
Case No.: Criminal Appeal No. 1755 Of 2010
Date: 25/09/2025
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