Insufficient funds for a cheque issued to discharge a lawful liability establishes an offence under Section 138 of the Negotiable Instruments Act, which includes a statutory presumption that must be rebutted by credible evidence.

JUDGMENT :

SANDEEP SHARMA, J.

1. Instant criminal revision petition filed under Section 397 of the Cr.P.C., lays challenge to judgment dated 05.03.2022, passed by the learned Additional Sessions Judge, Sarkaghat, District Mandi, Himachal Pradesh, in Criminal Appeal No. 13/21/19, titled Ashok Kumar Vs. Himachal Gramin Bank Paunta , affirming judgment of conviction and order of sentence dated 20.05.2019/27.06.2019, passed by the learned Additional Chief Judicial Magistrate, Court No.1, Sarkaghat, District Mandi, Himachal Pradesh, in case No.309/2013, whereby the learned trial Court while holding the petitioner-accused (hereinafter “accused”) guilty of having committed offence punishable under Section 138 of the Negotiable Instruments Act (in short the “Act"), convicted and sentenced him to undergo simple imprisonment for a period of one year and pay compensation to the tune of Rs.7,70,000/- to the respondent-complainant.

2. Precisely, the facts of the case, as emerge from the record are that respondent-complainant (hereinafter, ‘complainant’) instituted a complaint under Section 138 of the Act, in the competent Court of law, alleging therein that accused availed loan of Rs.20,00,000/- for purchasing AWM Tipper, but failed to pay the installment regularly. However, subsequently with a view to discharge the lawful liability and regularise his loan account, accused issued Cheque dated 14.01.2013, amounting to Rs.5,00,000/-. However, fact remains that afore Cheque on its presentation to the Bank concerned, was dishonoured with the remarks “Funds Insufficient”. After receipt of aforesaid return memo, complainant served accused with a legal notice calling upon him to make the payment good well within stipulated time. However, since petitioner-accused failed to make the payment good within the time stipulated in the legal notice, respondent/complainant was compelled to initiate proceedings under of the Act in the Court of learned Additional Chief Judicial Magistrate, Court No.1, Sarkaghat, District Mandi, Himachal Pradesh.

3. Learned trial Court on the basis of material adduced on record by the respective parties, vide judgment/order dated 20.05.2019/27.06.2019, held the petitioner-accused guilty of having committed offence under Section 138 of the Act and accordingly, convicted and sentenced him, as per the description given hereinabove.

4. Though, at the first instance, accused preferred an appeal in the Court of learned Additional Sessions Judge, Sarkaghat, District Mandi, Himachal Pradesh, however, same was dismissed vide judgment dated 05.03.2022. In the aforesaid background, petitioner-accused has approached this Court by way of instant proceedings, seeking therein his acquittal after setting aside the judgments of conviction recorded by the Courts below.

5. This Court vide order dated 16.03.2023, passed the following order:

“Learned counsel representing the petitioner(s) states that during the pendency of the case matter has been settled under OTS scheme. As per OTS scheme, some amount has been paid, whereas remaining amount shall be paid after sanction of Board of Directors. He states that since petitioner has already paid substantial amount, coupled with the fact that he has already served the sentence for 11 months, this Court while exercising power under Section 147 of the Act, may compound the offence and acquit him of the charge.

Ms. Devyani Sharma, learned Senior Counsel representing the respondent states that though balance amount, as agreed under OTS scheme, has not been paid by the petitioner, but since some amount has been paid and he has alread