JMFC Court Acquits Man in Rs. 20 Lakh Cheque Bounce Case, Cites Money Lending Without License is Illegal

The JMFC court in Bandra acquitted an accused under Section 138 of the Negotiable Instruments Act, observing that the underlying loan was an illegal money lending transaction.

The complainant, Sarika Bedi, had lent ₹20 lakh at 18% interest without possessing a valid money lending license, which makes it unenforceable under the Maharashtra Money Lending (Regulation)Act, 2014.

The accused contended that the cheques were issued merely as security and denied any legal liability. The court held that to convict under Section 138, the complainant must prove a legally enforceable debt.

Since the loan was illegal, it could not be enforced, and the accused was acquitted.