S.R. Sunil & Co vs D. Srinivasavaradan

The Supreme Court upheld the conviction under Section 138 of the Negotiable Instruments Act, emphasizing that the dishonor of a cheque is a serious matter requiring appropriate sentencing. The Court noted that while the principal amount of Rs. 1,40,00,000/- was repaid, the respondent failed to pay the promised interest, leading to the cheque bouncing. The Court imposed a fine of Rs. 5,38,425/- and a default sentence of two years simple imprisonment, highlighting the need for a deterrent sentence given the prolonged delay in payment.