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,
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.
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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.
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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
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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.
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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
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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
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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 detailedappreciation 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 provisionis 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 notdwell 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
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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
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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;
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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
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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 Courtis 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 andof
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)
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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 amountcovered 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
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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 accusedof
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, wecannot 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 inany manner.
****
42. Therefore, we are of the opinion that suggestions made to
the witness by the defence counsel and the reply to suchsuggestions 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
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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
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considering the fact that the accused has admitted the
issuance of the cheques and his signature on the cheque andthat 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 thatthere 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 thatthe 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 theabsence 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.
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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 theaccused 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, thepresumption 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).
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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.
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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 haddismissed the complaint after holding that the complainant’s
rt
evidence regarding sale of apple crop was doubtful because ofdiscrepancies 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
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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 bedisputed 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 therespondent.”
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 thebasis 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 ofthe 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
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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 todispel/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 theof
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 thepetitioners 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 onlycomment that the reasoning of the High Court, as well as the First
Appellate Court and Trial Court, on this issue is sound. Just takinga counter-stand to raise a probable defence would not shift the
onus on the complainant in such a case, for the plea of defencehas 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:
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’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 thatextent, 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 capacityof
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 thecross-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 accusedhas 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
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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
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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
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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 evenaccording 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 theabsence 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 notproperly 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. Itappears that both the learned trial court as well as the High
Court have committed an error in shifting the burden uponthe 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
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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:
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“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
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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 toof
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 postwith 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
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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’, itof
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 theaddress 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 addressby registered post. It is not necessary to aver in the complaint
that, despite the return of the notice unserved, it is deemed tohave 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 havebeen 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
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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 theordinary 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
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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
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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 andSection 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 theof
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.
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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 chequeswithout 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: –
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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.
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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
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