Under Section 138 of the Negotiable Instruments Act, a dishonoured cheque establishes a presumption of liability that the accused must rebut; mere denial is insufficient in the absence of evidence.

JUDGMENT :

Rakesh Kainthla, J.

The present revision is directed against the judgment dated 26.04.2025 passed by learned Additional Sessions Judge-1, Shimla, H.P. (learned Appellate Court), vide which the judgment of conviction and order of sentence dated 29.09.2023, passed by learned Judicial Magistrate First Class, Chopal, District Shimla, HP (learned Trial Court) were upheld (Parties shall hereinafter be referred to in the same manner as they were arrayed before the learned Trial Court for convenience.)

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 the commission of an offence punishable under Section 138 of the Negotiable Instruments Act (NI Act). It was asserted that the complainant is a bank established under the Society Registration Act 1979, having its head office at SDA Commercial Complex, Kasumpti, Shimla and a branch office at Chopal. It is engaged in banking activities. The accused applied for a loan of Rs. 5 lakhs on 02/01/2016. The complaint disbursed the loan to the accused, and the accused signed various documents to avail the loan. The accused failed to return the amount, and he was liable to pay Rs.1,77,920 till January 2021. The accused issued a postdated cheque of Rs. 1,77,920/- dated 19/01/2020 drawn on Punjab National Bank, Sarain (Ex. CW1/B). The complainant presented the cheque for realisation on 03/02/2021, but it was dishonoured with an endorsement ‘payment stopped by drawer' vide memo (Ex.CW1/C). The complainant issued a legal notice (Ex.CW1/D) asking the accused to pay the amount within 15 days of the receipt of the notice. The notice was served upon the accused, but the accused failed to pay the amount; hence, the complaint was filed before the learned Trial Court for taking action as per law.

3. The 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 to be tried.

4. The complainant examined Narender Kumar (CW1) to prove its complaint.

5. The accused, in his statement recorded under Section 313 of Cr.P.C., admitted that the complainant had advanced a loan of Rs. 5 lakh in his favour and he had executed the necessary documents in the complainant's favour. He admitted that he had issued a postdated cheque of Rs. 1,77,920 drawn on Punjab National Bank, Sarain, Shimla, in the complainant's favour. He admitted that the complainant presented the cheque for encashment, but it was dishonoured with an endorsement 'payment stopped by the drawer'. He admitted that the complainant had issued a legal notice to him, which was duly served upon him, and he had not paid any money to the complainant. He stated that he had paid Rs. 45,000 and Rs. 1,50,000 to the complainant. He stated that the complainant had filed a false complaint against him, and he was innocent. He did not produce any evidence in defence.

6. Learned Trial Court held that taking of the loan, the issuance of the cheque, its dishonour and service of the notice upon the accused were not disputed. A cheque carried with it a presumption that it was issued in discharge of the debt/legal liability. The accused admitted taking the loan, and he did not produce any evidence to rebut the presumption attached to the cheque. The complainant denied the suggestions made to him during his