In a recent decision on February 25, 2026, the Madras High Court, with Justice M. Nirmal Kumar presiding, cleared N. Narayanan, a former director of Pyramid Saimira Theatre Limited, in a case about a bounced cheque. Here's a simple breakdown of what happened.
In 2008 and 2009, Pyramid Saimira Theatre Limited, with directors including N. Narayanan, got permission to borrow Rs. 25 Crores from Axis Bank but only used Rs. 12.5 Crores. Problems arose when the company couldn't pay back the money, leaving Rs. 13.5 Crores unpaid. To try to fix this, they wrote a cheque for Rs. 40 lakhs on September 29, 2009, but it bounced because there wasn't enough money in the account.
The case first went to the Metropolitan Magistrate Court in Chennai. On April 27, 2019, the court found N. Narayanan and others guilty under a law about bounced cheques, sentencing them to six months in jail and ordering them to pay Rs. 80 lakhs as compensation.
N. Narayanan challenged the decision. On August 27, 2021, another court in Chennai cut the jail time to three months but kept the compensation the same. Still not satisfied, N. Narayanan asked for another review.
N. Narayanan's Side: He said the cheque wasn't to pay back the loan but was for processing fees. He also pointed out that the company was in financial trouble and being shut down, with its bank accounts frozen by the Income Tax Department.
Axis Bank's Side: Axis Bank argued that the cheque was meant to pay off part of the unpaid loan. They disagreed with N. Narayanan's explanation about the cheque's purpose.
During the legal proceedings, N. Narayanan made several payments adding up to Rs. 40 lakhs to Axis Bank through bank drafts. The bank acknowledged these payments.
Given that the full cheque amount was paid and the company was being shut down, Justice M. Nirmal Kumar overturned the earlier guilty verdict and sentence. The court decided that N. Narayanan wasn't responsible under the law about bounced cheques and cleared him of all charges.
The court's decision means that N. Narayanan is not guilty of the charges related to the bounced cheque, and Axis Bank can take back any money related to the case from the trial court. This case shows how important it is to understand financial responsibilities and what can happen with issued cheques.
