The Supreme Court (SC) on Monday came down heavily on Bollywood actor Rajpal Yadav for failing to honour an undertaking to deposit Rs 5 crore in a cheque bounce case involving a private firm named Murli Projects Pvt Ltd, directing him to process the payment by Tuesday.

A bench headed by Chief Justice of India (CJI) Surya Kant, along with Justices Joymalya Bagchi and V Mohana rebuked the actor after it was informed that Yadav had failed to deposit the amount despite an earlier undertaking. The case is titled Rajpal Naurang Yadav & Anr v. M/S Murli Projects Pvt Ltd.

“Your place is in jail”: SC to Yadav

The court observed that Yadav had undertaken to deposit Rs 5 crore with the court registry by Monday. Instead, the counsel representing him produced a copy of a Rs 50 lakh demand draft and said it was being processed by the bank. The bench remarked, “Is this genuine or not? We don’t know.”

When the actor’s counsel said the draft was with the bank, counsel for the complainant accused Yadav of showing little respect for the majesty of the institution. Justice Bagchi then delivered a warning, saying, “They may be richer than you, but they are poor to the extent you have swindled them. This arrogance needs to be put in its right place. You should know when to open your mouth. Your place is in jail.”

Details of the Rs 5 crore dispute

The dispute stems from Rs 5 crore received by Yadav and his wife from Murli Projects in connection with a film being produced by the actor. After the film failed to achieve completion within the stipulated time, the parties entered into four agreements.

Under the third agreement, Yadav issued eight security cheques to Murli projects. The arrangement was then replaced by a fourth agreement, called ‘a consent agreement’ dated April 21, 2013.

As per Yadav’s plea, the agreement provided for the return of the eight security cheques and the issuance of four fresh cheques of Rs 10 crore each. Yadav alleged that Murli Projects did not return the original security cheques and instead presented seven of them, which were dishonoured.

Subsequently, criminal complaints had been registered against Yadav and his wife.

Yadav’s trajectory from conviction to jail

In May 2024, a sessions court convicted Yadav and sentenced him to six months of jail term. The Delhi High Court (HC) later suspended the sentence after the actor’s counsel assured the HC that the dispute would be resolved.

The matter had also been referred to the HC’s mediation centre. However, the HC later noted that despite repeated assurances and adjournments, Yadav had failed to stand up to his payment commitments, including an undertaking to pay Rs 2.5 crore in instalment. Following this, the HC ordered him in February this year to surrender before the jail authorities after junking his request for more time. Yadav abided by the court’s directives on February 5 and remained in custody until the HC granted an interim suspension of his sentence, after he deposited Rs 1.5 crore with the complainant.

Thereafter, he was sentenced to 3 months’ imprisonment for failing to deposit the remaining amount despite several undertakings. Yadav challenged the order before the apex court.

SC sets final deadline

Yadav contended in his plea that the subsequent consent agreement rendered the earlier cheques invalid, making the complaints under Section 138 of the Negotiable Instruments Act legally unsustainable.

On September 8 this year, the Supreme Court exempted Yadav from surrendering, subject to the condition that he deposit the money by September 9. On September 15, the court granted him another 2-week extension and ordered him to deposit the amount by October 5.

When the matter was heard on Monday, the court was apprised of the fact that the payment had still not been made. Yadav’s counsel cited the closure of the banks for three or four days as reason behind the non-payment. The SC bench questioned the explanation, pointing out that Yadav had been provided 16 days after the September 16 order.

The court asserted, “Today we are on October 5. You are out of time by seven days. You could have filed an application seeking extension of time.” Meanwhile, the complainant’s counsel said the total outstanding amount stood at Rs 7.5 crore and argued that Yadav should be held liable for contempt.

However, the SC declined to dismiss his appeal at this stage, noting that doing so could make recovery of the money more difficult for the complainant. The Bench ruled, “We want to dismiss it, but we also want to balance equities to ensure that your client gets some money.”

Towards the end of the hearing, the court ordered Yadav to make the payment by Tuesday and listed the matter for compliance.