Cheque bounce: Prakash Industries Ltd's MD gets one year jail

NEW DELHI: A Delhi court has awarded one year jail term to Prakash Industries Ltd's Managing Director in 20-year-old cheque bounce cases and directed him and the firm to pay Rs 10 crore each to two Sahara group companies.

It directed Prakash Industries and its MD V P Aggarwal to pay Rs 5 crore each to Sahara India Airlines Ltd (SIAL) and Sahara India Financial Corporation Ltd (SIFCL), which had given a loan of Rs 5 crore each to the firm, through him, in May 1996.

The convicted company had handed over cheques to pay back the money. However, these got dishonoured and both the complainant companies filed cases in this regard.

"Considering the length of the proceedings, this court is of the opinion that even if the cheque amount involved would have been deposited in bank, it would have been doubled by now," Metropolitan Magistrate Nupur Gupta said.

The court noted that the present matter was pending since 1997 and "the very purpose of Negotiable Instruments Act seems to have been frustrated".

During the proceedings, the advocates appearing for the complainants, P K Dubey and Neha Gupta, had sought maximum punishment for the convicts saying their clients had suffered irreparable losses and litigation for 20 years because of the malafide acts of convicts.

The court said the fine amount, Rs 20 crore in both the cases, will be divided as Rs 10 crore each as compensation to both the complainant companies.

According to the complaints, SIAL and SIFCL had given a loan of Rs 5 crore each to PIL through Aggarwal in May 1996.

Later in February 1997, the accused issued two cheques of Rs 26.42 lakh and Rs 5.26 crore in favour of SIAL. However, both the cheques were dishonoured after presenting before the bank.

Similarly, a cheque of Rs 5.34 crore was issued in favour of SIFCL. However, it also was returned as dishonoured.

Thereafter, both the complainants sent legal notices to the accused which was unanswered. Thereafter, cases were filed in this regard.