NOVA ELECTRICALS Vs. STATE OF MAHARASHTRA

JUDGEMENT

(1.) Rule. Rule made returnable forthwith. With the consent of respective parties, matter is taken up for hearing.

(2.) At the outset, Shri S. S. Choudhari, learned counsel for applicant stipulates that the challenge is to the legality of the order of issuance of process and, therefore, quashing of the proceedings is not pressed at this stage.

(3.) Respondent No. 2 Shri Vyas Dhanwarsha Sahakari Bank Limited, Yaval, had advanced loan of Rs. 3 lakhs in the category of "hypothecation cash credit loan". Entire loan of Rs. 3 lakhs was withdrawn by the applicant on 20th October, 2000. The loan was to be repaid on or before 20th September, 2001. As repayment was not done, applicant issued a cheque drawn on Janata Sahakari Bank Limited, Jalgaon. The cheque was presented for encashment but was dishonoured. After service of notice, as applicant failed to make repayment within stipulated period, respondent No. 2 initiated proceedings in respect of offence punishable under Section 138 of the Negotiable Instruments Act and 420 of the Indian Penal Code, in the Court of Judicial Magistrate, First Class, Yaval.