Het Ram (Panchayat Secretary) vs Prakash Chand & Another on 29 July, 2026

    0
    28
    ADVERTISEMENT

    Himachal Pradesh High Court

    Het Ram (Panchayat Secretary) vs Prakash Chand & Another on 29 July, 2026

                                                                                            2026:HHC:31277
    
        IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
    
    
                                                  Cr. Revision No. 221 of 2015
                                                  Reserved on: 21.07.2026
    
    
    
    
                                                                                       .
                                                  Date of Decision: 29.07.2026
    
    
    
    
    
        Het Ram (Panchayat Secretary)                                                        ...Petitioner
    
    
    
    
    
                                                 Versus
        Prakash Chand & another                                                      ...Respondents
    
    
    
    
                                                         of
        _______________________________________
        Coram
        Hon'ble Mr Justice Rakesh Kainthla, Judge.
                               rt
        Whether approved for reporting?1 No
        For the petitioner                                 :      Mr H.S. Rangra, Advocate.
    
        For Respondent No.1                                :      Mr R.L. Chaudhary, Advocate.
        For Respondent No.2/State                         :       Mr Jitender Sharma,
                                                                  Additional Advocate General.
    
    
    
        Rakesh Kainthla, Judge
    

    The present revision is directed against the judgment

    dated 21.11.2013 passed by the learned Additional Sessions Judge,

    SPONSORED

    Mandi, District Mandi (learned Appellate Court), vide which the

    judgment of conviction dated 27.06.2012 and order of sentence dated

    29.06.2012 passed by the learned Judicial Magistrate First Class,

    Court No. 2, Mandi (learned Trial Court) were upheld. (The parties

    shall hereinafter be referred to in the same manner as they were arrayed

    before the learned Trial Court for convenience).

    1 Whether reporters of Local Papers may be allowed to see the judgment? Yes.

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    2

    2026:HHC:31277

    2. Briefly stated, the facts giving rise to the present revision

    are that the complainant filed a complaint before the learned Trial

    Court against the accused for taking action against him for the

    .

    commission of an offence punishable under Section 138 of the

    Negotiable Instruments Act (NI Act). It was asserted that the

    complainant and the accused were known to each other. The accused

    borrowed ₹85,000/- from the complainant for his domestic

    of
    requirements. He promised to return the amount within three

    months. The complainant demanded the money, and the accused
    rt
    issued a cheque of ₹85,000/- to return the money. The complainant

    presented the cheque at his bank, but it was dishonoured with the

    endorsement “insufficient funds”. The complainant sent a legal

    notice to the accused, asking him to repay the money within 15 days

    of the receipt of the notice. The notice was duly served upon the

    accused, but the accused failed to repay the money. Hence, the

    complaint was filed before the learned Trial Court against the

    accused.

    3. Learned Trial Court found sufficient reasons to summon

    the accused. When the accused appeared, a notice of accusation was

    put to him for the commission of an offence punishable under

    Section 138 of the NI Act, to which he pleaded not guilty and claimed

    trial.

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    3

    2026:HHC:31277

    4. The complainant examined Shyam Kishore (CW1) and

    himself (CW2) to prove his complaint.

    5. The accused, in his statement recorded under Section 313

    .

    of the Code of Criminal Procedure (CrPC), denied the complainant’s

    case in its entirety. He claimed that a false complaint was filed

    against him. The complainant had filled the date himself, and there

    was an overwriting in the cheque. He did not produce any evidence in

    of
    his defence.

    6.
    rt
    Learned Trial Court held that the accused had issued the

    cheque, and a presumption arose that the cheque was issued for

    consideration to discharge the debt/liability. The accused failed to

    rebut the presumption. The plea taken by the accused that there was

    an overwriting in the cheque will not help him because the

    overwriting was duly initialled by the accused. The cheque was

    dishonoured with endorsement “insufficient funds”. The notice was

    duly served upon the accused, and the accused failed to repay the

    money despite the receipt of the notice. All the ingredients of the

    commission of an offence punishable under Section 138 of the NI Act

    were duly satisfied. Hence, the learned Trial Court convicted the

    accused of the commission of an offence punishable under Section

    138 of the NI Act and sentenced him to undergo simple

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    4
    2026:HHC:31277
    imprisonment for three months, pay a fine of ₹95,000/- and, in

    default of payment of the fine, to undergo simple imprisonment for

    15 days. It was ordered that out of the fine amount of ₹95,000/-,

    .

    ₹90,000/- would be disbursed to the complainant as compensation.

    7. Being aggrieved by the judgment and order passed by the

    learned Trial Court, the accused filed an appeal which was decided by

    the learned Additional Sessions Judge, Mandi (learned Appellate

    of
    Court). The learned Appellate Court concurred with the findings

    recorded by the learned Trial Court that the issuance of the cheque
    rt
    was duly proved. The burden shifted upon the accused to rebut the

    presumption that the cheque was issued for consideration to

    discharge the debt/liability. The accused had failed to produce any

    evidence. The plea that there was an overwriting in the cheque would

    not help the accused because the overwriting was authenticated by

    the signatures of the accused. The cheque was dishonoured with an

    endorsement “funds insufficient”. The notice was duly served upon

    the accused, and the accused failed to repay the money. The learned

    Trial Court had rightly convicted the accused. The sentence imposed

    was adequate, which did not require any interference from the

    Appellate Court. Hence, the appeal was dismissed.

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    5

    2026:HHC:31277

    8. Being aggrieved by the judgment and order passed by the

    learned Courts below, the accused has filed the present revision

    asserting that the learned Courts below had not properly appreciated

    .

    the material placed before them. There were various contradictions

    in the statements of the complainant’s witnesses. The plea taken by

    the accused that the cheque was filled by the complainant was not

    considered by the learned Courts below. The signatures and the rest

    of
    of the body of the complaint were in different ink which proved the

    plea taken by the accused that the complainant had filled the cheque.

    rt
    Therefore, it was prayed that the present revision be allowed and the

    judgments and order passed by the learned Courts below be set

    aside.

    9. I have heard Mr H.S. Rangra, learned counsel for the

    petitioner, Mr R.L. Chaudhary, learned counsel for the respondent

    no. 1 and Mr Jitender Sharma, learned Additional Advocate General

    for respondent no. 2/State.

    10. Mr H.S. Rangra, learned counsel for the petitioner,

    submitted that learned Courts below had not properly appreciated

    the material placed before them. The cheque contained an

    overwriting and was invalid. The notice was sent to the incorrect

    address and was never served upon the accused. The plea taken by

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    6
    2026:HHC:31277
    the accused that the cheque was issued as a security was highly

    probable and learned Courts below erred in rejecting this plea.

    Therefore, he prayed that the present revision be allowed and the

    .

    judgments and order passed by learned Courts below be set aside.

    11. Mr R.L. Chaudhary, learned counsel for the respondent

    no. 1/complainant submitted that the issuance of the cheque was not

    disputed and a presumption would apply to the present case that the

    of
    cheque was issued for consideration to discharge the debt/liability.

    The accused failed to rebut the presumption by leading any evidence.

    rt
    The overwriting was duly authenticated by the signatures of the

    accused. The notice was returned with a report that the addressee

    was not available at home, which is deemed service. This Court

    should not re-appreciate the evidence while deciding a revision.

    Therefore, he prayed that the present revision be dismissed.

    12. Mr Jitender Sharma, learned Additional Advocate General

    for respondent no. 2/State submitted that the dispute is between the

    private parties and the State has no submissions to make.

    13. I have given considerable thought to the submissions

    made at the bar and have gone through the records carefully.

    14. It was laid down by the Hon’ble Supreme Court in

    Malkeet Singh Gill v. State of Chhattisgarh, (2022) 8 SCC 204: (2022) 3

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    7
    2026:HHC:31277
    SCC (Cri) 348: 2022 SCC OnLine SC 786 that a revisional court is not an

    appellate court and it can only rectify the patent defect, errors of

    jurisdiction or the law. It was observed at page 207-

    .

    “10. Before adverting to the merits of the contentions, at the
    outset, it is apt to mention that there are concurrent findings
    of conviction arrived at by two courts after a detailed

    appreciation of the material and evidence brought on record.
    The High Court in a criminal revision against conviction is not
    supposed to exercise the jurisdiction like the appellate court,

    of
    and the scope of interference in revision is extremely narrow.
    Section 397 of the Criminal Procedure Code (in short “CrPC“)
    vests jurisdiction to satisfy itself or himself as to the
    correctness, legality or propriety of any finding, sentence or
    rt
    order, recorded or passed, and as to the regularity of any
    proceedings of such inferior court. The object of the provision

    is to set right a patent defect or an error of jurisdiction or law.
    There has to be a well-founded error that is to be determined
    on the merits of individual cases. It is also well settled that
    while considering the same, the Revisional Court does not

    dwell at length upon the facts and evidence of the case to
    reverse those findings.

    15. This position was reiterated in State of Gujarat v. Dilipsinh

    Kishorsinh Rao, (2023) 17 SCC 688: 2023 SCC OnLine SC 1294, wherein

    it was observed at page 695:

    “14. The power and jurisdiction of the Higher Court under
    Section 397 CrPC, which vests the court with the power to call
    for and examine records of an inferior court, is for the
    purposes of satisfying itself as to the legality and regularities
    of any proceeding or order made in a case. The object of this
    provision is to set right a patent defect or an error of
    jurisdiction or law or the perversity which has crept in such
    proceedings.

    15. It would be apposite to refer to the judgment of this Court
    in Amit Kapoor v. Ramesh Chander [Amit Kapoor v. Ramesh

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    8
    2026:HHC:31277
    Chander, (2012) 9 SCC 460: (2012) 4 SCC (Civ) 687: (2013) 1 SCC
    (Cri) 986], where scope of Section 397 has been considered and
    succinctly explained as under: (SCC p. 475, paras 12-13)
    “12. Section 397 of the Code vests the court with the
    power to call for and examine the records of an inferior

    .

    court for the purposes of satisfying itself as to the

    legality and regularity of any proceedings or order made
    in a case. The object of this provision is to set right a
    patent defect or an error of jurisdiction or law. There has

    to be a well-founded error, and it may not be
    appropriate for the court to scrutinise the orders, which,
    upon the face of it, bear a token of careful consideration

    of
    and appear to be in accordance with law. If one looks
    into the various judgments of this Court, it emerges that
    the revisional jurisdiction can be invoked where the
    decisions under challenge are grossly erroneous, there is
    rt
    no compliance with the provisions of law, the finding
    recorded is based on no evidence, material evidence is

    ignored, or judicial discretion is exercised arbitrarily or
    perversely. These are not exhaustive classes, but are
    merely indicative. Each case would have to be
    determined on its own merits.

    13. Another well-accepted norm is that the revisional
    jurisdiction of the higher court is a very limited one and

    cannot be exercised in a routine manner. One of the inbuilt
    restrictions is that it should not be against an interim or

    interlocutory order. The Court has to keep in mind that the
    exercise of revisional jurisdiction itself should not lead to
    injustice ex facie. Where the Court is dealing with the question

    as to whether the charge has been framed properly and in
    accordance with law in a given case, it may be reluctant to
    interfere in the exercise of its revisional jurisdiction unless the
    case substantially falls within the categories aforesaid. Even
    the framing of the charge is a much-advanced stage in the
    proceedings under CrPC.”

    16. It was held in Kishan Rao v. Shankargouda, (2018) 8 SCC

    165: (2018) 3 SCC (Cri) 544: (2018) 4 SCC (Civ) 37: 2018 SCC OnLine SC

    651 that it is impermissible for the High Court to re-appreciate the

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    9
    2026:HHC:31277
    evidence and come to its conclusions in the absence of any

    perversity. It was observed at page 169:

    “12. This Court has time and again examined the scope of

    .

    Sections 397/401 CrPC and the grounds for exercising the

    revisional jurisdiction by the High Court. In State of Kerala v.
    Puttumana Illath Jathavedan Namboodiri
    , (1999) 2 SCC 452:

    1999 SCC (Cri) 275], while considering the scope of the

    revisional jurisdiction of the High Court, this Court has laid
    down the following: (SCC pp. 454-55, para 5)

    5. … In its revisional jurisdiction, the High Court can call

    of
    for and examine the record of any proceedings to satisfy
    itself as to the correctness, legality or propriety of any
    finding, sentence or order. In other words, the
    jurisdiction is one of supervisory jurisdiction exercised
    rt
    by the High Court for correcting a miscarriage of justice.

    But the said revisional power cannot be equated with the

    power of an appellate court, nor can it be treated even as
    a second appellate jurisdiction. Ordinarily, therefore, it
    would not be appropriate for the High Court to re-
    appreciate the evidence and come to its conclusion on

    the same when the evidence has already been
    appreciated by the Magistrate as well as the Sessions
    Judge in appeal, unless any glaring feature is brought to

    the notice of the High Court which would otherwise

    amount to a gross miscarriage of justice. On scrutinising
    the impugned judgment of the High Court from the
    aforesaid standpoint, we have no hesitation in

    concluding that the High Court exceeded its jurisdiction
    in interfering with the conviction of the respondent by
    reappreciating the oral evidence. …”

    13. Another judgment which has also been referred to
    and relied on by the High Court is the judgment of this
    Court in Sanjaysinh Ramrao Chavan v. Dattatray Gulabrao
    Phalke
    , (2015) 3 SCC 123: (2015) 2 SCC (Cri) 19]. This Court
    held that the High Court, in the exercise of revisional
    jurisdiction, shall not interfere with the order of the
    Magistrate unless it is perverse or wholly unreasonable
    or there is non-consideration of any relevant material;

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    10

    2026:HHC:31277
    the order cannot be set aside merely on the ground that
    another view is possible. The following has been laid
    down in
    para 14: (SCC p. 135)
    “14. … Unless the order passed by the Magistrate is
    perverse or the view taken by the court is wholly

    .

    unreasonable or there is non-consideration of any

    relevant material or there is palpable misreading of
    records, the Revisional Court is not justified in
    setting aside the order, merely because another view

    is possible. The Revisional Court is not meant to act
    as an appellate court. The whole purpose of the
    revisional jurisdiction is to preserve the power in

    of
    the court to do justice in accordance with the
    principles of criminal jurisprudence. The revisional
    power of the court under Sections 397 to 401 CrPC is
    rt not to be equated with that of an appeal. Unless the
    finding of the court, whose decision is sought to be
    revised, is shown to be perverse or untenable in law

    or is grossly erroneous or glaringly unreasonable or
    where the decision is based on no material or where
    the material facts are wholly ignored or where the
    judicial discretion is exercised arbitrarily or

    capriciously, the courts may not interfere with the
    decision in exercise of their revisional jurisdiction.”

    17. This position was reiterated in Bir Singh v. Mukesh Kumar,

    (2019) 4 SCC 197: (2019) 2 SCC (Cri) 40: (2019) 2 SCC (Civ) 309: 2019

    SCC OnLine SC 13, wherein it was observed at page 205:

    “16. It is well settled that in the exercise of revisional
    jurisdiction under Section 482 of the Criminal Procedure Code,
    the High Court does not, in the absence of perversity, upset
    concurrent factual findings. It is not for the Revisional Court
    to re-analyse and re-interpret the evidence on record.

    17. As held by this Court in Southern Sales & Services v.
    Sauermilch Design and Handels GmbH
    , (2008) 14 SCC 457, it is a
    well-established principle of law that the Revisional Court will
    not interfere even if a wrong order is passed by a court having

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    11
    2026:HHC:31277
    jurisdiction, in the absence of a jurisdictional error. The
    answer to the first question is, therefore, in the negative.”

    18. A similar view was taken in Sanjabij Tari v. Kishore S.

    Borcar, 2025 SCC OnLine SC 2069, wherein it was observed:

    .

    “27. It is well settled that in exercise of revisional jurisdiction,
    the High Court does not, in the absence of perversity, upset
    concurrent factual findings [See: Bir Singh(supra)]. This Court

    is of the view that it is not for the Revisional Court to re-
    analyse and re-interpret the evidence on record. As held by
    this Court in Southern Sales & Services v. Sauermilch Design and

    of
    Handels GMBH
    , (2008) 14 SCC 457, it is a well-established
    principle of law that the Revisional Court will not interfere,
    even if a wrong order is passed by a Court having jurisdiction,
    in the absence of a jurisdictional error.

    rt

    28. Consequently, this Court is of the view that in the absence

    of perversity, it was not open to the High Court in the present
    case, in revisional jurisdiction, to upset the concurrent
    findings of the Trial Court and the Sessions Court.

    19. The present revision has to be decided as per the

    parameters laid down by the Hon’ble Supreme Court.

    20. The ingredients of the offence punishable under Section

    138 of the NI Act were explained by the Hon’ble Supreme Court in

    Kaveri Plastics v. Mahdoom Bawa Bahrudeen Noorul, 2025 SCC OnLine

    SC 2019 as under: –

    “5.1.1. In K.R. Indira v. Dr. G. Adinarayana (2003) 8 SCC 300, this
    Court enlisted the components, aspects and the acts, the
    concatenation of which would make the offence under Section
    138
    of the Act complete, to be these (i) drawing of the cheque
    by a person on an account maintained by him with a banker,
    for payment to another person from out of that account for
    discharge in whole/in part of any debt or liability, (ii)
    presentation of the cheque by the payee or the holder in due

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    12
    2026:HHC:31277
    course to the bank, (iii) returning the cheque unpaid by the
    drawee bank for want of sufficient funds to the credit of the
    drawer or any arrangement with the banker to pay the sum
    covered by the cheque, (iv) giving notice in writing to the
    drawer of the cheque within 15 days of the receipt of

    .

    information by the payee from the bank regarding the return

    of the cheque as unpaid, demanding payment of the cheque
    amount, and (v) failure of the drawer to make payment to the
    payee or the holder in due course of the cheque, of the amount

    covered by the cheque, within 15 days of the receipt of the
    notice.”

    21. The complainant Prakash Chand (CW2) stated that the

    of
    accused had taken a loan of ₹85,000/- and handed over a cheque

    (Ext.CW2/A) to return the money. He stated in his cross-

    rt
    examination that he had taken two cheques from the accused. One

    was for ₹1,00,000/- and the other was for ₹85,000/-. The cheque of

    ₹85,000/- was taken on 17.04.2008. He was running a furniture

    business. He had withdrawn the money from the bank, and he had

    not produced any document regarding the withdrawal. He denied

    that the accused had taken furniture from him and had issued a

    blank cheque. He denied that a false complaint was made against the

    accused.

    22. The cross-examination of the complainant shows that

    the accused has not disputed the issuance of the cheque; rather, it

    was suggested to the complainant that the cheque was issued in lieu

    of the furniture taken by the accused. It was laid down by the

    Hon’ble Supreme Court in Balu Sudam Khalde v. State of

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    13
    2026:HHC:31277
    Maharashtra, (2023) 13 SCC 365: 2023 SCC OnLine SC 355 that the

    suggestion put to the witness can be taken into consideration while

    determining the innocence or guilt of the accused. It was observed at

    .

    page 383:

    “38. Thus, from the above, it is evident that the suggestion

    made by the defence counsel to a witness in the cross-
    examination, if found to be incriminating in nature in any
    manner, would definitely bind the accused, and the accused

    of
    cannot get away on the plea that his counsel had no implied
    authority to make suggestions in the nature of admissions
    against his client.

    39. Any concession or admission of a fact by a defence counsel
    rt
    would definitely be binding on his client, except for the
    concession on the point of law. As a legal proposition, we

    cannot agree with the submission canvassed on behalf of the
    appellants that an answer by a witness to a suggestion made
    by the defence counsel in the cross-examination does not
    deserve any value or utility if it incriminates the accused in

    any manner.

    ****

    42. Therefore, we are of the opinion that suggestions made to
    the witness by the defence counsel and the reply to such

    suggestions would definitely form part of the evidence and
    can be relied upon by the Court along with other evidence on
    record to determine the guilt of the accused.”

    23. Therefore, the suggestion made to the complainant can

    be considered while appreciating the evidence.

    24. The accused has also not disputed the issuance of the

    cheque in the present revision. He specifically asserted in para 4 (d)

    that learned Courts below had not considered the facts that the

    cheque was issued as a security. Therefore, the issuance of the

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    14
    2026:HHC:31277
    cheque was never disputed and learned Courts below had rightly

    held that the presumption applied to the present case that the

    cheque was issued for consideration to discharge the debt/liability.

    .

    It was laid down by the Hon’ble Supreme Court in APS Forex Services

    (P) Ltd. v. Shakti International Fashion Linkers (2020) 12 SCC 724, that

    when the issuance of a cheque and signature on the cheque are not

    disputed, a presumption would arise that the cheque was issued in

    of
    discharge of the legal liability. It was observed: –

    “9. Coming back to the facts in the present case and
    rt
    considering the fact that the accused has admitted the
    issuance of the cheques and his signature on the cheque and

    that the cheque in question was issued for the second time
    after the earlier cheques were dishonoured and that even
    according to the accused some amount was due and payable,
    there is a presumption under Section 139 of the NI Act that

    there exists a legally enforceable debt or liability. Of course,
    such a presumption is rebuttable. However, to rebut the
    presumption, the accused was required to lead evidence that

    the full amount due and payable to the complainant had been

    paid. In the present case, no such evidence has been led by the
    accused. The story put forward by the accused that the
    cheques were given by way of security is not believable in the

    absence of further evidence to rebut the presumption, and
    more particularly, the cheque in question was issued for the
    second time after the earlier cheques were dishonoured.
    Therefore, both the courts below have materially erred in not
    properly appreciating and considering the presumption in
    favour of the complainant that there exists a legally
    enforceable debt or liability as per Section 139 of the NI Act. It
    appears that both the learned trial court as well as the High
    Court have committed an error in shifting the burden upon
    the complainant to prove the debt or liability, without
    appreciating the presumption under Section 139 of the NI Act.

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    15

    2026:HHC:31277
    As observed above, Section 139 of the Act is an example of a
    reverse onus clause and therefore, once the issuance of the
    cheque has been admitted and even the signature on the
    cheque has been admitted, there is always a presumption in
    favour of the complainant that there exists legally enforceable

    .

    debt or liability and thereafter, it is for the accused to rebut

    such presumption by leading evidence.”

    25. This position was reiterated in N. Vijay Kumar v.

    Vishwanath Rao N., 2025 SCC OnLine SC 873, wherein it was held as

    under:

    of
    “6. Section 118 (a) assumes that every negotiable instrument
    is made or drawn for consideration, while Section 139 creates
    a presumption that the holder of a cheque has received the
    rt
    cheque in discharge of a debt or liability. Presumptions under
    both are rebuttable, meaning they can be rebutted by the

    accused by raising a probable defence.”

    26. A similar view was taken in Sanjabij Tari v. Kishore S.

    Borcar, 2025 SCC OnLine SC 2069, wherein it was observed:

    “ONCE EXECUTION OF A CHEQUE IS ADMITTED, PRESUMPTIONS

    UNDER SECTIONS 118 AND 139 OF THE NI ACT ARISE

    15. In the present case, the cheque in question has admittedly

    been signed by the Respondent No. 1-Accused. This Court is of
    the view that once the execution of the cheque is admitted, the

    presumption under Section 118 of the NI Act that the cheque in
    question was drawn for consideration and the presumption
    under Section 139 of the NI Act that the holder of the cheque
    received the said cheque in discharge of a legally enforceable
    debt or liability arises against the accused. It is pertinent to
    mention that observations to the contrary by a two-Judge
    Bench in Krishna Janardhan Bhat v. Dattatraya G. Hegde, (2008)
    4 SCC 54, have been set aside by a three-Judge Bench in
    Rangappa (supra).

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    16

    2026:HHC:31277

    16. This Court is further of the view that by creating this
    presumption, the law reinforces the reliability of cheques as a
    mode of payment in commercial transactions.

    17. Needless to mention that the presumption contemplated
    under Section 139 of the NI Act is rebuttable. However, the

    .

    initial onus of proving that the cheque is not in discharge of

    any debt or other liability is on the accused/drawer of the
    cheque [See: Bir Singh v. Mukesh Kumar, (2019) 4 SCC 197].

    27. Thus, the Court has to start with the presumption that

    the cheque was issued in discharge of the liability for consideration,

    of
    and the burden is upon the accused to rebut this presumption.

    28. It was submitted that the complainant admitted in his
    rt
    cross-examination that he had taken two cheques of ₹1,85,000/-

    which means that the complainant had taken ₹1,85,000/- in lieu of

    ₹85,000/- stated to have been advanced by him. This submission

    will not help the accused. The complainant has nowhere stated that

    he had filed a complaint regarding the cheque of ₹1,00,000/-. He

    claimed that the accused had taken the amount mentioned in the

    cheques for his domestic needs, which means that the accused had

    taken an amount of ₹1,85,000/- as per his cross-examination. Since

    the present complaint was confined to the cheque of ₹85,000/-.

    Therefore, it was not necessary to aver the facts relating to the

    issuance of the cheque of ₹1,00,000/-. Thus, this admission in the

    cross-examination will not help the accused.

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    17

    2026:HHC:31277

    29. The accused stated in his cross-examination that he had

    withdrawn the money from the bank, but he had not produced any

    document to prove this fact. It was submitted that the complainant’s

    .

    version regarding the withdrawal of the money from the bank and

    advancing it to the accused cannot be accepted without any

    document. This submission will not help the accused. In Uttam Ram

    v. Devinder Singh Hudan, (2019) 10 SCC 287: (2020) 1 SCC (Cri) 154:

    of
    (2020) 1 SCC (Civ) 126: 2019 SCC OnLine SC 1361, the Trial Court had

    dismissed the complaint after holding that the complainant’s
    rt
    evidence regarding sale of apple crop was doubtful because of

    discrepancies in the number of cartons. This judgment was upheld

    by this Court. The Hon’ble Supreme Court set aside the judgments of

    this Court and the Trial Court after holding that the complainant is

    not required to produce any evidence regarding the sale of the apple

    crop because of the presumption contained in Section 139 of the NI

    Act and his case could not have been doubted because of

    discrepancies. It was observed at page 293:

    “20. The trial court and the High Court proceeded as if the
    appellant is to prove a debt before a civil court wherein the
    plaintiff is required to prove his claim on the basis of evidence
    to be laid in support of his claim for the recovery of the
    amount due. A dishonour of a cheque carries a statutory
    presumption of consideration. The holder of a cheque in due
    course is required to prove that the cheque was issued by the
    accused and that when the same was presented, it was not

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    18
    2026:HHC:31277
    honoured. Since there is a statutory presumption of
    consideration, the burden is on the accused to rebut the
    presumption that the cheque was issued not for any debt or
    other liability.

    xxxxx

    .

    28. The accused has failed to lead any evidence to rebut the

    statutory presumption, a finding returned by both the trial
    court and the High Court. Both courts not only erred in law but
    also committed perversity when the due amount is said to be

    disputed only on account of discrepancy in the cartons,
    packing material or the rate to determine the total liability as
    if the appellant was proving his debt before the civil court.

    of
    Therefore, it is presumed that the cheques in question were
    drawn for consideration and the holder of the cheques, i.e. the
    appellant, received the same in discharge of an existing debt.
    The onus, thereafter, shifts on the appellant-accused to
    rt
    establish a probable defence so as to rebut such a
    presumption, which onus has not been discharged by the

    respondent.”

    30. This position was reiterated in Ashok Singh v. State of U.P.,

    2025 SCC OnLine SC 706, wherein it was observed:

    “22. The High Court while allowing the criminal revision has

    primarily proceeded on the presumption that it was obligatory
    on the part of the complainant to establish his case on the

    basis of evidence by giving the details of the bank account as
    well as the date and time of the withdrawal of the said amount
    which was given to the accused and also the date and time of

    the payment made to the accused, including the date and time
    of receiving of the cheque, which has not been done in the
    present case. Pausing here, such presumption on the
    complainant, by the High Court, appears to be erroneous. The
    onus is not on the complainant at the threshold to prove his
    capacity/financial wherewithal to make the payment in
    discharge of which the cheque is alleged to have been issued
    in his favour. Only if an objection is raised that the
    complainant was not in a financial position to pay the amount
    so claimed by him to have been given as a loan to the accused,
    only then would the complainant have to bring before the

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    19
    2026:HHC:31277
    Court cogent material to indicate that he had the financial
    capacity and had actually advanced the amount in question by
    way of a loan. In the case at hand, the appellant had
    categorically stated in his deposition and reiterated in the
    cross-examination that he had withdrawn the amount from

    .

    the bank in Faizabad (Typed Copy of his deposition in the

    paperbook wrongly mentions this as ‘Firozabad’). The Court
    ought not to have summarily rejected such a stand, more so
    when respondent no. 2 did not make any serious attempt to

    dispel/negate such a stand/statement of the appellant. Thus,
    on the one hand, the statement made before the Court, both in
    examination-in-chief and cross-examination, by the

    of
    appellant with regard to withdrawing the money from the
    bank for giving it to the accused has been disbelieved, whereas
    the argument on behalf of the accused that he had not
    received any payment of any loan amount has been accepted.

    rt
    In our decision in S. S. Production v. Tr. Pavithran Prasanth,
    2024 INSC 1059, we opined:

    ‘8. From the order impugned, it is clear that though the
    contention of the petitioners was that the said amounts were
    given for producing a film and were not by way of return of any
    loan taken, which may have been a probable defence for the

    petitioners in the case, but rightly, the High Court has taken the
    view that evidence had to be adduced on this point which has not
    been done by the petitioners. Pausing here, the Court would only

    comment that the reasoning of the High Court, as well as the First
    Appellate Court and Trial Court, on this issue is sound. Just taking

    a counter-stand to raise a probable defence would not shift the
    onus on the complainant in such a case, for the plea of defence

    has to be buttressed by evidence, either oral or documentary,
    which in the present case has not been done. Moreover, even if it
    is presumed that the complainant had not proved the source of
    the money given to the petitioners by way of loan by producing
    statement of accounts and/or Income Tax Returns, the same ipso
    facto, would not negate such claim for the reason that the
    cheques having being issued and signed by the petitioners has
    not been denied, and no evidence has been led to show that the
    respondent lacked capacity to provide the amount(s) in question.
    In this regard, we may make profitable reference to the decision in
    Tedhi Singh v. Narayan Dass Mahant, (2022) 6 SCC 735:

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    20

    2026:HHC:31277
    ’10. The trial court and the first appellate court have noted that
    in the case under Section 138 of the NI Act, the complainant
    need not show in the first instance that he had the capacity.
    The proceedings under Section 138 of the NI Act are not a civil
    suit. At the time when the complainant gives his evidence,

    .

    unless a case is set up in the reply notice to the statutory notice

    sent, that the complainant did not have the wherewithal, it
    cannot be expected of the complainant to initially lead
    evidence to show that he had the financial capacity. To that

    extent, the courts, in our view, were right in holding on those
    lines. However, the accused has the right to demonstrate that
    the complainant in a particular case did not have the capacity

    of
    and therefore, the case of the accused is acceptable, which he
    can do by producing independent materials, namely, by
    examining his witnesses and producing documents. It is also
    open to him to establish the very same aspect by pointing to
    rt
    the materials produced by the complainant himself. He can
    further, more importantly, achieve this result through the

    cross-examination of the witnesses of the complainant.
    Ultimately, it becomes the duty of the courts to consider
    carefully and appreciate the totality of the evidence and then
    come to a conclusion whether, in the given case, the accused

    has shown that the case of the complainant is in peril for the
    reason that the accused has established a probable
    defence.'(emphasis supplied)’ (underlining in original;

    emphasis supplied by us in bold).

    31. A similar view was taken in Sanjay Sanjabij Tari v. Kishore

    S. Borcar, 2025 SCC OnLine SC 2069, wherein it was observed:

    “21. This Court also takes judicial notice of the fact that some
    District Courts and some High Courts are not giving effect to
    the presumptions incorporated in Sections 118 and 139 of the
    NI Act and are treating the proceedings under the NI Act as
    another civil recovery proceedings and are directing the
    complainant to prove the antecedent debt or liability. This
    Court is of the view that such an approach is not only
    prolonging the trial but is also contrary to the mandate of
    Parliament, namely, that the drawer and the bank must

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    21
    2026:HHC:31277
    honour the cheque; otherwise, trust in cheques would be
    irreparably damaged.”

    32. Therefore, the complainant’s version cannot be discarded

    because he had not produced any document to show the withdrawal

    .

    of the money from the bank.

    33. The plea taken before this Court that the cheque was

    issued as a security was never taken by him before the learned Trial

    of
    Court. He nowhere stated in his statement recorded under Section

    313 of the Cr.P.C. that he had issued the cheque in favour of the
    rt
    complainant as a security. It was suggested to the complainant that

    the cheque was issued in lieu of the furniture taken by the accused,

    clearly showing that the cheque was towards the liability to pay the

    money for the furniture. Therefore, there was no evidence to show

    that the cheque was issued as a security and learned Courts below

    cannot be faulted for not considering this plea.

    34. The cross-examination of the complainant does not

    disprove the fact that the cheque was issued for consideration to

    discharge the debt/liability. The accused did not produce any

    evidence to show that the cheque was not issued towards the

    debt/liability. He had not even stated this fact in his statement

    recorded under Section 313 of the Cr.P.C. Therefore, learned Courts

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    22
    2026:HHC:31277
    below had rightly held that the accused had failed to rebut the

    presumption attached to the cheque.

    35. The cheque (Ext.CW2/A) shows that the words THOUS

    .

    after the word EIGHTY were scored off. It was submitted that the

    alteration in the cheque would make it invalid. This submission will

    not help the accused. The complainant specifically stated in his

    cross-examination that the overwriting/cutting was initialled by the

    of
    accused. This is also evident from the cheque, wherein the

    signatures have been put above the overwriting and below it.

    rt
    Therefore, the overwriting was duly authenticated. The accused

    never claimed that the signatures on the cheque were not put by

    him. Therefore, the cheque cannot be held to be bad because of some

    overwriting in it.

    36. The complainant stated that the cheque was dishonoured

    with an endorsement “funds insufficient”. This is duly corroborated

    by the Memorandum (Ext.CW2/B) in which the reason of dishonour

    has been mentioned as “funds insufficient”. It was laid down by the

    Hon’ble Supreme Court in APS Forex Services (P) Ltd. v. Shakti

    International Fashion Linkers (2020) 12 SCC 724, that when the

    issuance of a cheque and signature on the cheque are not disputed, a

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    23
    2026:HHC:31277
    presumption arises that the cheque was issued in discharge of the

    legal liability. It was observed: –

    “9. Coming back to the facts in the present case and

    .

    considering the fact that the accused has admitted the

    issuance of the cheques and his signature on the cheque and
    that the cheque in question was issued for the second time
    after the earlier cheques were dishonoured and that even

    according to the accused some amount was due and payable,
    there is a presumption under Section 139 of the NI Act that
    there exists a legally enforceable debt or liability. Of course,

    of
    such a presumption is rebuttable. However, to rebut the
    presumption, the accused was required to lead evidence that
    the full amount due and payable to the complainant had been
    paid. In the present case, no such evidence has been led by the
    rt
    accused. The story put forward by the accused that the
    cheques were given by way of security is not believable in the

    absence of further evidence to rebut the presumption, and
    more particularly, the cheque in question was issued for the
    second time after the earlier cheques were dishonoured.
    Therefore, both the courts below have materially erred in not

    properly appreciating and considering the presumption in
    favour of the complainant that there exists a legally
    enforceable debt or liability as per Section 139 of the NI Act. It

    appears that both the learned trial court as well as the High
    Court have committed an error in shifting the burden upon

    the complainant to prove the debt or liability, without
    appreciating the presumption under Section 139 of the NI Act.

    As observed above, Section 139 of the Act is an example of a
    reverse onus clause and therefore, once the issuance of the
    cheque has been admitted and even the signature on the
    cheque has been admitted, there is always a presumption in
    favour of the complainant that there exists legally enforceable
    debt or liability and thereafter, it is for the accused to rebut
    such presumption by leading evidence.”

    37. In the present case, the complainant did not produce any

    evidence to show that the contents of the memo of dishonour are

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    24
    2026:HHC:31277
    incorrect. Therefore, learned Courts below had rightly held that the

    cheque was dishonoured with endorsement ‘insufficient funds.’

    38. The complainant stated that he had issued a notice

    .

    (Ext.CW2/C) to the accused asking him to pay the money. The notice

    was returned with an endorsement that the addressee was not

    available in the panchayat despite repeated visits, and it be returned.

    It was submitted that the address mentioned on the notice is

    of
    incorrect and the notice was never served upon the accused. This

    submission cannot be accepted. There is a presumption of
    rt
    correctness to the endorsement made by the Public Official in

    discharge of the official duties, which has not been rebutted by the

    accused; rather, the accused has given the same address in the

    notice of accusation and his statement recorded under Section 313 of

    the Cr.P.C. Thus, the submission that the notice was sent to the

    incorrect address cannot be accepted.

    39. It was laid down by the Hon’ble Supreme Court in D.

    Vinod Shivappa v. Nanda Belliappa, (2006) 6 SCC 456: (2006) 3 SCC

    (Cri) 114: 2006 SCC OnLine SC 629, that a notice returned with an

    endorsement “house locked” would lead to a presumption that the

    notice was validly served and the burden would be upon the accused

    to show that the report is incorrect. It was observed at page 462:

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    25

    2026:HHC:31277
    “14. If a notice is issued and served upon the drawer of the
    cheque, no controversy arises. Similarly, if the notice is
    refused by the addressee, it may be presumed to have been
    served. This is also not disputed. This leaves us with the third
    situation where the notice could not be served on the

    .

    addressee for one or the other reason, such as his non-

    availability at the time of delivery, or premises remaining
    locked on account of his having gone elsewhere, etc. etc. If in
    each such case the law is understood to mean that there has

    been no service of notice, it would completely defeat the very
    purpose of the Act. It would then be very easy for an
    unscrupulous and dishonest drawer of a cheque to make

    of
    himself scarce for some time after issuing the cheque so that
    the requisite statutory notice can never be served upon him,
    and consequently, he can never be prosecuted. There is good
    authority to support the proposition that once the
    rt
    complainant, the payee of the cheque, issues notice to the
    drawer of the cheque, the cause of action to file a complaint

    arises on the expiry of the period prescribed for payment by
    the drawer of the cheque. If he does not file a complaint within
    one month of the date on which the cause of action arises
    under clause (c) of the proviso to Section 138 of the Act, his

    complaint gets barred by time. Thus, a person who can dodge
    the postman for about a month or two, or a person who can
    get a fake endorsement made regarding his non-availability,

    can successfully avoid his prosecution because the payee is
    bound to issue notice to him within a period of 30 days from

    the date of receipt of information from the bank regarding the
    return of the cheque as unpaid. He is, therefore, bound to issue
    the legal notice, which may be returned with an endorsement

    that the addressee is not available at the given address.
    xxxxx

    18. This Court noticed the position well settled in law that the
    notice refused to be accepted by the drawer can be presumed
    to have been served on him. In that case, the notice was
    returned as “unclaimed” and not as refused. The Court posed
    the question, “Will there be any significant difference between
    the two so far as the presumption of service is concerned?”

    Their Lordships referred to Section 27 of the General Clauses
    Act and observed that the principle incorporated therein could

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    26
    2026:HHC:31277
    profitably be imported in a case where the sender had
    dispatched the notice by post with the correct address written
    on it. Then it can be deemed to have been served on the
    sendee, unless he proves that it was not really served and that
    he was not responsible for such non-service. This Court

    .

    dismissed the appeal preferred by the drawer, holding that

    where the notice is returned by the addressee as unclaimed,
    such date of return to the sender would be the commencing
    date in reckoning the period of 15 days contemplated in clause

    (c) of the proviso to Section 138 of the Act. This would be
    without prejudice to the right of the drawer of the cheque to
    show that he had no knowledge that the notice was brought to

    of
    his address. Since the appellant did not attempt to discharge
    the burden to rebut the aforesaid presumption, the appeal was
    dismissed by this Court. The aforesaid decision is significant
    for two reasons. Firstly, it was held that the principle
    rt
    incorporated in Section 27 of the General Clauses Act would
    apply in a case where the sender dispatched the notice by post

    with the correct address written on it, but that would be
    without prejudice to the right of the drawer of the cheque to
    show that he had no knowledge that the notice was brought to
    his address.”

    40. It was laid down by the Hon’ble Supreme Court of India

    in C.C. Allavi Haji vs. Pala Pelly Mohd. 2007(6) SCC 555, that when a

    notice is returned unclaimed, it is deemed to be served. It was

    observed:

    “8. Since in Bhaskaran’s case (supra), the notice issued in terms
    of Clause (b) had been returned unclaimed and not as refused,
    the Court, posed the question: “Will there be any significant
    difference between the two so far as the presumption of
    service is concerned?” It was observed that though Section 138
    of the Act does not require that the notice should be given only
    by “post”, yet in a case where the sender has dispatched the
    notice by post with the correct address written on it, the
    principle incorporated in Section 27 of the General Clauses
    Act, 1897 (for short ‘G.C. Act‘) could profitably be imported in
    such a case. It was held that in this situation service of notice

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    27
    2026:HHC:31277
    is deemed to have been effected on the sendee unless he
    proves that it was not really served and that he was not
    responsible for such non-service.”

    41. This position was reiterated in Priyanka Kumari vs.

    .

    Shailendra Kumar (13.10.2023- SC Order): MANU/ SCOR/ 133284/ 2023,

    wherein it was observed:

    “As it was held by the Hon’ble Supreme Court in K. Bhaskaran
    Vs. Sankaran Vaidhyan Balan and Another
    , (1999) 7 Supreme
    Court Cases 510, that when notice is returned as ‘unclaimed’, it

    of
    shall be deemed to be duly served upon the addressee, and it is
    a proper service of notice. In the case of Ajeet Seeds Limited Vs.
    K. Gopala Krishnaiah
    (2014) 12 SCC 685 (2014), the Hon’ble
    Court, while interpreting Section 27 of the General Clauses
    rt
    Act, 1897 and also Section 114 of the Evidence Act, 1872, held
    as under: –

    Section 114 of the Evidence Act, 1872, enables the court to
    presume that in the common course of natural events, the
    communication sent by post would have been delivered at the

    address of the addressee. Further, Section 27 of the General
    Clauses Act, 1897 gives rise to a presumption that service of
    notice has been effected when it is sent to the correct address

    by registered post. It is not necessary to aver in the complaint
    that, despite the return of the notice unserved, it is deemed to

    have been served or that the addressee is deemed to have
    knowledge of the notice. Unless and until the contrary is
    proved by the addressee, service of notice is deemed to have

    been effected at the time at which the letter would have been
    delivered in the ordinary course of business.”

    42. A similar view was taken in Krishna Swaroop Agarwal v.

    Arvind Kumar, 2025 SCC OnLine SC 1458, wherein it was observed:

    “13. Section 27 of the General Clauses Act, 1887, deals with
    service by post:

    “27. Meaning of Service by post.-Where any [Central
    Act] or Regulation made after the commencement of

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    28
    2026:HHC:31277
    this Act authorizes or requires any document to be
    served by post, whether the expression “serve” or either
    of the expressions “give” or “send” or any other
    expression is used, then, unless a different intention
    appears, the service shall be deemed to be effected by

    .

    properly addressing, pre-paying and posting by

    registered post, a letter containing the document, and,
    unless the contrary is proved, to have been effected at
    the time at which the letter would be delivered in the

    ordinary course of post”.

    14. The concept of deemed service has been discussed by this
    Court on various occasions. It shall be useful to refer to some

    of
    instances:

    14.1 In Madan and Co. v. Wazir Jaivir Chand (1989) 1 SCC 264,
    which was a case concerned with the payment of arrears of
    rt
    rent under the J&K Houses and Shops Rent Control Act, 1966.

    The proviso to Section 11, which is titled “Protection of a
    Tenant against Eviction”, states that unless the landlord

    serves notice upon the rent becoming due, through the Post
    Office under a registered cover, no amount shall be deemed to
    be in arrears. Regarding service of notice by post, it was

    observed that in order to comply with the proviso, all that is
    within the landlord’s domain to do is to post a pre-paid
    registered letter containing the correct address and nothing

    further. It is then presumed to be delivered under Section 27 of
    the GC Act. Irrespective of whether the addressee accepts or

    rejects, “there is no difficulty, for the acceptance or refusal can be
    treated as a service on, and receipt by the addressee.”
    14.2 In the context of Section 138 of the Negotiable

    Instruments Act, 1881, it was held that when the payee
    dispatches the notice by registered post, the requirement
    under Clause (b) of the proviso of Section 138 of the NI Act
    stands complied with and the cause of action to file a
    complaint arises on the expiry of that period prescribed in
    Clause (c) thereof. [See: C.C. Alavi Haji v. Palapetty
    Mouhammed
    (2007) 6 SCC 555]
    14.3 The findings in C.C. Alavi (supra) were followed in
    Vishwabandhu v. Srikrishna (2021) 19 SCC 549. In this case, the
    summons issued by the Registered AD post was received back

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    29
    2026:HHC:31277
    with endorsement “refusal”. In accordance with Sub-Rule (5)
    of Order V Rule 9 of CPC, refusal to accept delivery of the
    summons would be deemed to be due service in accordance
    with law. To substantiate this view, a reference was made to the
    judgment referred to supra.

    .

    14.4 A similar position as in C.C. Alavi (supra) stands adopted by

    this Court in various judgments of this Court in Greater Mohali
    Area Development Authority v. Manju Jain
    (2010) 9 SCC 157;
    Gujarat Electricity Board v. Atmaram Sungomal Posani (1989) 2

    SCC 602; CIT v. V. K. Gururaj (1996) 7 SCC 275; Poonam Verma v.
    DDA
    (2007) 13 SCC 154; Sarav Investment & Financial Consultancy
    (P) Ltd. v. Lloyds Register of Shipping Indian Office Staff Provident

    of
    Fund
    (2007) 14 SCC 753; Union of India v. S.P. Singh (2008) 5 SCC
    438; Municipal Corpn., Ludhiana v. Inderjit Singh (2008) 13 SCC
    506; and V.N. Bharat v. DDA (2008) 17 SCC 321.

    43.
    rt
    In the present case, the accused has not proved that he

    was not responsible for non-service; therefore, the learned Courts

    below had rightly held that the notice was deemed to be served upon

    the accused.

    44. In any case, it was laid down in C.C. Allavi Haji vs. Pala

    Pelly Mohd. 2007(6) SCC 555, that the person who claims that he had

    not received the notice has to pay the amount within 15 days from

    the date of the receipt of the summons from the Court and in case of

    failure to do so, he cannot take advantage of the fact that notice was

    not received by him. It was observed:

    “It is also to be borne in mind that the requirement of giving
    notice is a clear departure from the rule of Criminal Law,
    where there is no stipulation of giving notice before filing a
    complaint. Any drawer who claims that he did not receive the
    notice sent by post, can, within 15 days of receipt of summons from
    the court in respect of the complaint under Section 138 of the Act,

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    30
    2026:HHC:31277
    make payment of the cheque amount and submit to the Court that
    he had made payment within 15 days of receipt of summons (by
    receiving a copy of the complaint with the summons) and,
    therefore, the complaint is liable to be rejected. A person who does
    not pay within 15 days of receipt of the summons from the Court,

    .

    along with the copy of the complaint under Section 138 of the Act,

    cannot obviously contend that there was no proper service of
    notice as required under Section 138, by ignoring the statutory
    presumption to the contrary under Section 27 of the G.C. Act and

    Section 114 of the Evidence Act. In our view, any other
    interpretation of the proviso would defeat the very object of
    the legislation. As observed in Bhaskaran‘s case (supra), if the

    of
    giving of notice in the context of Clause (b) of the proviso was
    the same as the receipt of notice, a trickster cheque drawer
    would get the premium to avoid receiving the notice by
    adopting different strategies and escape from the legal
    rt
    consequences of Section 138 of the Act.” (Emphasis supplied)

    45. The accused did not claim that he had repaid the money

    to the complainant, and it was duly proved on record that the

    accused had failed to repay the amount despite the receipt of the

    notice.

    46. Therefore, it was duly proved on record that the accused

    had issued a cheque to the complainant to repay the money taken by

    him, which was dishonoured with an endorsement “insufficient

    funds” and the accused failed to repay the money despite the

    deemed receipt of a notice of demand. Hence, all the ingredients of

    the commission of an offence punishable under Section 138 of the NI

    Act were duly satisfied.

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    31

    2026:HHC:31277

    47. Learned Trial Court had sentenced the accused to

    undergo simple imprisonment for three months and pay a fine of

    ₹95,000/-. It was laid down by the Hon’ble Supreme Court in Bir

    .

    Singh v. Mukesh Kumar, (2019) 4 SCC 197: (2019) 2 SCC (Cri) 40: (2019)

    2 SCC (Civ) 309: 2019 SCC OnLine SC 138 that the penal provision of

    section 138 is deterrent in nature. It was observed at page 203:

    “6. The object of Section 138 of the Negotiable Instruments

    of
    Act is to infuse credibility into negotiable instruments,
    including cheques, and to encourage and promote the use of
    negotiable instruments, including cheques, in financial
    rt
    transactions. The penal provision of Section 138 of the
    Negotiable Instruments Act is intended to be a deterrent to
    callous issuance of negotiable instruments such as cheques

    without serious intention to honour the promise implicit in
    the issuance of the same.”

    48. Keeping in view the deterrent nature of the punishment,

    the sentence of three months cannot be said to be excessive.

    49. The cheque was issued for ₹85,000/- on 17.04.2008. The

    Learned Trial Court imposed the sentence on 29.06.2012 and

    awarded ₹90,000/- as compensation to the complainant. It was laid

    down by the Hon’ble Supreme Court in Kalamani Tex v. P.

    Balasubramanian, (2021) 5 SCC 283: (2021) 3 SCC (Civ) 25: (2021) 2

    SCC (Cri) 555: 2021 SCC OnLine SC 75 that the Courts should uniformly

    levy a fine up to twice the cheque amount along with simple interest

    at the rate of 9% per annum. It was observed at page 291: –

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    32

    2026:HHC:31277

    19. As regards the claim of compensation raised on behalf of
    the respondent, we are conscious of the settled principles that
    the object of Chapter XVII of NIA is not only punitive but also
    compensatory and restitutive. The provisions of NIA envision
    a single window for criminal liability for the dishonour of a

    .

    cheque as well as civil liability for the realisation of the cheque

    amount. It is also well settled that there needs to be a
    consistent approach towards awarding compensation, and
    unless there exist special circumstances, the courts should

    uniformly levy fines up to twice the cheque amount along with
    simple interest @ 9% p.a. [R. Vijayan v. Baby, (2012) 1 SCC 260,
    para 20: (2012) 1 SCC (Civ) 79: (2012) 1 SCC (Cri) 520]”

    of

    50. The complainant lost interest on the amount which he
    rt
    would have gained by investing the money in the bank. He had to

    engage a counsel to prosecute the complaint before the Court, and

    he was entitled to be compensated for it. Hence, the compensation

    of ₹5,000/- is inadequate. However, the complainant has not filed

    any complaint or any appeal for enhancement of the sentence and

    no interference is required with the fine imposed by the learned

    Trial Court.

    51. No other point was urged.

    52. In view of the above, the present revision fails and is

    dismissed.

    53. The present revision stands disposed of, and so are the

    pending miscellaneous application(s), if any.

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS
    33

    2026:HHC:31277

    54. The record of the learned Courts below be returned with a

    copy of the judgment.

    (Rakesh Kainthla)

    .

    Judge

    29th July, 2026
    (Nikita)

    of
    rt

    ::: Downloaded on – 29/07/2026 20:33:25 :::CIS



    Source link

    LEAVE A REPLY

    Please enter your comment!
    Please enter your name here