Cheque bounce: Oswal industry boss guilty, 'jailed' for a day

  • Shailee Dogra, Hindustan Times, Chandigarh
  • Updated: Feb 22, 2015 07:54 IST

While upholding the conviction of NK Oswal, chairman and managing director (CMD) of Oswal Papers and Allied Industries at Mukerian in Hoshiarpur, in a cheque dishonour case, a district court here made the 60-year-old corporate honcho sit in the courtroom till the rising for the day. He was also ordered to pay Rs 11.5 lakh to the Punjab Warehousing Corporation (PWHC).

But it was some relief for him, as a judicial magistrate had earlier sentenced him to 18 months in prison and ordered payment of Rs 15 lakh on March 30, 2013, under section 138 of the Negotiable Instruments Act.

On his appeal, district and sessions judge SK Aggarwal ruled on February 16 (order made available now) held, "There is no illegality and infirmity in the judgment of conviction." But, it added, "Considering Oswal is in the evening of his life and facing the pangs of trial since 2011 and is ready to pay the cheque amount, therefore, in the interest of justice, it is deemed appropriate to sentence him till rising of the court and to pay compensation to the tune of Rs 11,49,999."

The two cheques had originated from a dispute on account of non-lifting of some equipment by Oswal industries from a godown of the PWHC at Ludhiana. The dues were more than Rs 6 crore, but, after the company made a representation to the corporation, the matter was settled at Rs 2 crore to be paid in installments.

Oswal issued 38 post-dated cheques drawn on the State Bank of Patiala to the corporation. But when the corporation presented two cheques of Rs 5 lakh each, these were dishonoured due to 'payment stopped by drawer'.

Claiming false implication, Oswal had submitted that the cheques were issued as security, not for any debt or liability; therefore, no offence under the relevant law was made out. Oswal's counsel had even said that the corporation had prior knowledge of the cheques having been stopped, but presented these to the bank with the intention of settling a score.

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