IN THE COURT OF METROPOLITAN MAGISTRATE

AT 38th COURT AT, BALLARD PIER, MUMBAI

CASE NO. OF 2016

M/S. ANAND RATHI SHARE AND STOCK BROKERS LIMITED)

A Company duly incorporated under the )

Indian Companies Act, 1956 having their )

office at 4th Floor, Silver Metropolis, )

Jay Coach Compound, Opp Bimbisar Nagar )

Goregaon (East), Mumbai – 400 063 )

through its Authorised Representative )

Mr. Chetan Nagda, age 47 Years, )

occupation : Service, residing at Mumbai )

as per Resolution dated …………………. ) .. COMPLAINANT

VERSUS

MR. RAHUL GUPTA )

Aged about …….. years )

S/o Shri …………………………….. )

A resident Indian, having its resident at )

Prem Niwas, Shakti Nagar )

Solan – 173212, Himachal Pradesh ) … ACCUSED PERSON

Cheques Amount : Rs. 1,20,00,000.00

Court fees payable : Rs. 1,57,230.00

Court fees paid : Rs. 1,57,230.00

CHARGE U/S. 138 R/W 141, 142 OF THE

NEGOTIABLE INSTRUMENTS ACT, 1881 (AS

AMENDED UPTO DATE)

MAY IT PLEASE YOUR WORSHIP:

 I, Mr. Chetan Nagda, Aged 47 Years, the Authorised

Representative of the Complainant above named, do hereby solemnly

affirm and state as follows:

1) I am the Authorized Representative duly authorized by Board

Resolution dated ……………. of M/s. Anand Rathi Share and Stock

Brokers Ltd. signed by its Director Shri …………….. I am conversant with

the facts of the case and know the Accused Person. Hereto annexed and

marked “Exhibit “A” is a copy of the Board Resolution dated

………………. issued by the Complainant Company.

2) I know the Accused Person. The Accused is resident Indian having

his resident at aforesaid address.

3) That in or around 22nd March, 2014, the accused namely Mr. Rahul

Gupta approached the Complainant’s Chandigarh branch office with

desire and request to affect dealing in shares, securities and derivative

contracts through the Bombay Stock Exchange Limited (BSE) and National

Stock Exchange of India Limited (NSEIL) in Capital and Derivative Market

Segment.

4) The accused has become the client of the Complainant Company by

signing and delivering Client Registration Form and executing Rights and

Obligations document with the complainant as on __________. Accused

has also acknowledged, signed and delivered the Risk Disclosure

Document and Investor Rights and Obligation documents as prescribed by

Securities and Exchange Board of India (SEBI). Client Registration Form,

Rights and Obligation Document, Risk Disclosure Document and Investors

rights and obligations collectively known and referred to hereinafter as

KYC (Know Your Client Document), formulated as per the Rules,

Regulations and Bye-laws of SEBI/ Exchange for carrying out transactions

in securities in Capital and Derivative market segment of the Exchange(s).

The accused has also furnished while executing the KYC, various other

documents necessary to be furnished under the said bye-laws and

regulations for opening securities trading account with the Complainant.

Hereto annexed and marked as Exhibit “B” is copy of KYC documents

signed and executed by the Accused with the Complainant at the time of

opening of his trading account.

5) Since the date of opening of his trading account with the Complainant,

accused has actively carried out trades and transactions in his account

through National Stock Exchange of India Limited (NSEIL) under his client

code PCHNR3029 in shares/ securities/ contracts and other instruments

from 22/03/2014 to 29/01/2015 and the contract notes and bills in

respect of the same have been delivered to the Accused in due course,

which he has received and accepted without any objection of whatsoever

nature.

6) By relying on the representation, assurance and request of the accused,

the Complainant company used to accept and consider counter folio of

cheque deposit receipt as proof of deposit of cheque under the CMS

clearing in its Bank account bearing no. 00600340005097 maintained with

HDFC Bank Ltd, Fort Mumbai branch, towards the margin requirement /

pay in obligations for his dealing in Bombay Stock Exchange Limited (BSE)

and National Stock Exchange of India Limited (NSE) in Capital and

Derivative market segment.

7) On January 16, 2015, accused called up complainant’s branch office

staff and conveyed that he has tendered a cheque bearing no. 622847

drawn on UCO Bank, Solan Branch amounting to Rs. 2,58,00,000/-

(Rupees Two Crores Fifty Eight Lakhs only) in HDFC Bank, Solan Branch for

deposit in the complainant’s bank account, to meet up/ fulfill his margin

requirement in F&O segment. He further represented to the branch staff

of the Complainant that he had sent a scan image of cheque bearing no.

622847, amounting to Rs. 2,58,00,000/- (Rupees Two Crores Fifty Eight

Lakhs Only) and counter folio of deposit slip purportedly acknowledged by

HDFC bank, Solan Branch over mail. On the basis of representation made

by accused to complainant’s branch staff and on the strength of scan

image of cheque bearing no. 622847 amounting to Rs. 2,58,00,000/-

(Rupees Two Crores Fifty Eight Lakhs Only) drawn on UCO Bank, Solan

Branch and Counter folio of deposit slip (purportedly) acknowledged by

HDFC Bank, Solan Branch, the Complainant reasonably believed that the

said cheque has been deposited in their account and permitted the

accused to take the additional position in NSE F&O segment.

8) On the subsequent date i. e. January 17, 2015, accused again called up

complainant’s branch staff and conveyed that he has tendered a cheque

bearing no. 622848 drawn on UCO Bank, Solan Branch amounting to Rs.

1,65,00,000/- (Rupees One Crore Sixty Five Lakhs Only) in HDFC Bank,

Solan Branch for deposit in Complainant’s Bank account, to meet out/

fulfill margin requirement in F&O segment. On January 17, 2015 the

Accused has again represented to the branch staff that he has sent the

scan image of cheque bearing no. 622848 amounting to Rs. 1,65,00,000/-

(Rupees One Crore Sixty Five Lakhs only) and counter folio of deposit slip

purportedly acknowledged by HDFC Bank, Solan Branch over mail. On

placing reliance on the representations made by the accused to the

complainant’s staff and on the strength of scan image of cheque, bearing

no. 622848 amounting to Rs. 1,65,00,000/- (Rupees One Crore Sixty Five

Lakhs only) drawn on UCO Bank and counter folio of deposit slip

(purportedly) acknowledged by HDFC Bank, Solan Branch, the

Complainant reasonably believed that the accused has deposited the

aforesaid cheque in their bank account and accordingly permitted the

accused to hold the position in NSE F&O segment.

9) On January 20th, 2015, while reconciliation of bank account, the

Complainant observed that the cheque no. 622847 and 622848

amounting to Rs. 2,58,00,000/- and 1,65,00,000/- respectively,

purportedly deposited by the accused in the Complainant’s Bank account

were not credited in their bank account maintained with HDFC Bank

Limited. Further, the Complainant was astonished to learn that cheque

no. 622847 and 622848 amounting to Rs. 2,58,00,000/- and Rs.

1,65,00,000/- respectively were never deposited in the Bank account of

Complainant.

10) As a result to failure to deposit the funds towards the margin

requirement, there was MTM & Margin shortfall of Rs. 1,44,13,625.45

(Rupees One Crore Forty For Lakhs Thirteen Thousand Six Hundred

Twenty Five and Paise Forty Five) as on January 14, 2015, Rs.

5,24,52,454.02 (Rupees Five Crore Twenty Four lakhs Fifty two Thousand

Four Hundred Fifty Four and Paise Two only) on January 15, 2015, Rs.
7,23,81,132.15 (Rupees Seven Crores Forty Lakhs Eight Thousand Three

Hundred Seventy two and Paise Seventy Two Only) on January 19, 2015

lying in the accused’s trading account maintained with the Complainant.

11) After due investigation of the said matter, Complainant learned that

the accused in collusion with staff/ official of HDFC bank Ltd., Solan

Branch have forged and fabricated counter folio of two cheque deposit

slips dated January 16, 2015 and January 17, 2015. Further, the accused

with malafide intention used the aforesaid forged and fabricated cheque

deposit slips dated January 16, 2015 and January 17, 2015 to convince the

Complainant that he has remitted Rs. 2,58,00,000/- and Rs. 1,65,00,000/-

in the Complainant’s bank account to meet out/ fulfill the MTM/margin

requirement lying in his trading account, which was eventually resulted

MTM loss to the tune of Rs. 1,33,78,396.73 (Rupees One Crore Thirty

Three Lakhs Seventy Eight Thousand Three Hundred Ninety Six and Paise

Seventy Three only), which was due and payable by the accused to the

Complainant on account of an outstanding debit balance lying in his

trading account.

12) After realization of accused said illegal act, the Complainant’s senior

official personally had several meetings with the accused in the month

February, 2016 and requested him to pay a sum of Rs. 1,33,78,396.73

(Rupees One Crore Thirty Three Lakhs Seventy Eight Thousand Three

Hundred Ninety Six and Paise Seventy Three only), being outstanding

debit balance lying in his trading account maintained with the

Complainant.
13) During the personal meetings with the senior official of the

Complainant, accused has acknowledged and accepted that he has forged

and fabricated the counter folio of deposit slip in collusion with HDFC

Bank officials and used the same as genuine and induced our client to

believe that he has deposited Rs. 2,58,00,000/- and Rs. 1, 65,00,000/- in

Complainant’s account.

14) Further, upon persistent follow-up from the complainant side,

accused had signed and issued following four cheques in discharge of

outstanding balance in the aforesaid trading account:-

Cheque No. Cheque Date Amount Drawn on Branch

Bank Name

000036 31-3-2016 34 Lakhs HDFC BANK Solan Branch

000037 31-3-2016 34 Lakhs HDFC BANK Solan Branch

000038 31-3-2016 34 Lakhs HDFC BANK Solan Branch

000039 31-03-2016 18 Lakhs HDFC BANK Solan Branch

15) That at the time of handing over the above mentioned cheques, the

accused had assured the Complainant that the said cheques will be

honored/ encashed on presentation. Taking the above

assurance/representation as true, the complainant had accepted above

mentioned cheques.

16) That on the basis of assurances given by the accused, the Complainant

presented the above said cheques with its Banker namely, HDFC Bank

Limited, Fort, Mumbai 400 001 on 12/04/2016. It was to the utter surprise
and shock for the Complainant that on presentation of the said cheques

for payment, the same were returned unpaid vide returning memo dated

12/04/2016 with the remark “FUND INSUFFICIENT”.

16) Since the date of execution of trades and transactions resulting in

outstanding of Rs. 1,33,78,396.73 (Rupees One Crore Thirty Three

Thousand Lakhs Seventy Eight Thousand Three Hundred Ninety Six and

Paise Seventy Three only), the accused had no intention to pay the

outstanding debit amount to the complainant.

17) That on account of the dishonor of the said cheques, the Complainant

had served a legal notice dated 10/05/2016 through their Advocate Ms.

Madhuri R Raibagkar at the last known addresses of the Accused Person

for the dishonor of cheque, calling upon the Accused Person to make the

payment of the dishonored cheque amounting to Rs. 1,20,00,000/-

(Rupees One Crore Twenty Lacs Only) issued towards part payment of

outstanding dues within 15 days of the receipt of the said notice by them,

failing which the Complainant warned the Accused Person that

Complainant would be adopting criminal proceedings against them under

Section of the 138 r/w 141, 142 of the Negotiable Instruments Act (as

amended) and under Section 420 read with 34, 120 (b) of I. P. C. of the

Indian Penal Code. Hereto annexed and marked Exhibit “C” is demand

legal notice dated 10/5/2016 issued by the Complainant through its

Advocate.

18) The said notice had been posted to the Accused Persons by Speed

Post A.D. on 10/05/2016 at their last known addresses mentioned in the

cause title under Postal Receipts No. EM9336251451N Copy of Postal

Receipts is collectively annexed and marked as Exhibit “D”.

19) That the Accused has received the said notice issued by the

Complainant’s advocate. Hereto annexed and marked Exhibit “E” is

Proof of delivery of the said notice.

20) That the accused have failed to make payment of the aforesaid

dishonored cheques which has been issued by him malafidely,

intentionally and deliberately and knowingly. That at the time of issuing

the cheques, the Accused Person was fully aware that the said cheques

will not be honored on presentation, which clearly demonstrates that the

Accused had no intention to make the payment towards his liabilities. The

Accused Person has failed to make the payment against the dishonored

cheque/ net liability in terms of the demand notice issued by the

Complainant through its Advocate u/s. 138 r/w 141, 142 of the Negotiable

Instruments Act, 1881 (As amended) within stipulated time. Thus the

Accused Persons have committed offence punishable under Section 138

r/w 141, 142 of the Negotiable Instruments Act, 1881 and deserve to be

tried in accordance with the provisions of law.

21) That in view of the facts and circumstances, the Complainant has a

cause of action and right to file the present complaint. The cause of

actions has arisen in favour of the Complainant when, on the expiry of

the notice period, the Accused has not come forward to pay the amount

of dishonored cheques. The cause of action is still subsisting and

continuing in nature.

22) That the cheques have been returned dishonored on 12/04/2016, the

statutory demand notice to the Accused Person was issued on 10/5/2016

and the same was received by the Accused Person on 20/05/2015

Further, the period mentioned in statutory demand notice dated

10/5/2016 expired on 04/06/2016. Thus, the present complaint is filed

within the prescribed time as provided u/s. 142 (b) of the N.I. Act, 1881.

The cheque was deposited for payment at HDFC Bank, Fort, Mumbai

400 001 and the same was drawn on HDFC Bank, Solan, Himachal

Pradesh Branch which is situated within the jurisdiction of

…………………… Police Station. Thus, the Hon’ble Court has jurisdiction

to try, entertain and dispose of this complaint within the meaning of

Section 138 r/w 141, 142 of the Negotiable Instruments Act (As

amended).

23) That the complaint is well within limitation period under the Act:-

i. Date of Dishonor 12/04/2016

ii. Date of Notice 10/05/2016

iii. Date of filing Complaint ___________

24) That a list of documents and list of witnesses are annexed with this

complaint.

PRAYER

The Complainant therefore prays that:

a) this Hon’ble Court be pleased to issue process against the

Accused Person above named for offence punishable u/s.

138 r/w 141 of the Negotiable Instruments Act,

b) this Hon’ble Court be pleased to summon, prosecute and

punish the Accused Person and also direct the Accused

Person to pay the amount as double to the amount covered

under the said dishonored cheques, under the provisions of

Section 138 read with Section 142 of the Negotiable

Instruments Act,1881 as amended by the Negotiable

 Instrument laws (Amended and Miscellaneous Provisions)

Act, 2002. In accordance with Section 357 of Code of

Criminal Procedure 1974, out of the penalty imposed, the

Accused be ordered to compensate the Complainant to the

extent of Rs.1,20,00,000/- (Rupees One Crore Twenty Lacks

Only) and

c) For such other and further reliefs as this Hon’ble Court may

deem fit and proper.

Solemnly affirmed at Mumbai ]

On this ___day of June, 2016 ]

Complainant

Advocate for Complainant

LIST OF DOCUMENTS

1) Board Resolution dated …………..

2) Dishonored cheques No.
3) Memos of dishonor of cheque.
4) Demand Notice dated 10/05/2016 along with Postal
Receipts, Proof of Delivery.
5) Other relevant documents.

LIST OF WITNESS

1) The Manager,
HDFC Bank Ltd.,
Solan Branch,
Himachal Pradesh.

2) The Manager,
HDFC Bank Ltd,
Fort Branch,
Mumbai.

Advocate for Complainant.