Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2025 Supreme(HP) 1380

IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
Rakesh Kainthla, J.
Nand Lal Thakur - Appellant
Versus
Mukhtyar Singh - Respondent
Cr. Appeal No. 197 of 2012
Decided On : 30-10-2025

Advocates Appeared:
For the Appellant :Mr P.K. Verma, Advocate.
For the Respondent:Mr Skandh Sharma, Advocate.

Presumption under Section 139 NI Act that cheque is for debt discharge holds unless rebutted by preponderance of probabilities; trial acquittal reversed for perversely ignoring defence witness confirming payment and misapplying presumption and notice service.

Headnote:(A) Negotiable Instruments Act, 1881 - Section 138 - Dishonour of cheque for insufficient funds - Presumption under Sections 118(a) and 139 that cheque issued for consideration and discharge of debt or liability - Rebuttable on preponderance of probabilities by accused raising probable defence - Issuance and signature admitted, presumption arises shifting burden to accused - Defence witness confirming complainant paid amount on accused's behalf proves consideration - Trial Court erred in doubting payment absent bills, as complainant intervened in dispute and not supplier. (Paras 14-22)

(B) Negotiable Instruments Act, 1881 - Section 138 - Demand notice sent to correct address used by accused in proceedings - Deemed served under Section 27 General Clauses Act - Accused failed to rebut or pay within 15 days of summons receipt. (Paras 24-25)

(C) Criminal Procedure Code, 1973 - Section 378 - Cr.P.C., Section 313 - Appeal against acquittal - Appellate interference only if judgment patently perverse, based on misreading/omission of material evidence, or no reasonable acquittal view possible. (Paras 12-13)

Facts of the case:
Complainant paid Rs.1,50,000/- on behalf of accused to supplier amid dispute, accused issued post-dated cheque towards repayment, dishonoured for insufficient funds, notice issued, trial court acquitted holding no proof of payment, no bills produced, no notice service, and case suspect due to supplier-complainant relation.

Findings of Court:
Acquittal set aside, accused convicted under Section 138 NI Act, to be produced for sentencing on specified date.

Issues: Whether underlying payment proved despite no bills/receipt; presumption under Section 139 rebutted; notice served; trial court findings perverse warranting reversal.

Ratio Decidendi: Supplier as defence witness admitted payment by complainant on accused's behalf before cheque issuance, binding on accused and proving consideration; no valid rebuttal to presumption; bank memo and unchallenged testimony confirm dishonour; notice deemed served to correct address; trial court ignored evidence and presumption.

Result: Appeal allowed.

Table of Content
1. appeal against acquittal in cheque dishonour case. (Para 1 , 2)
2. trial proceedings and acquittal reasoning. (Para 3 , 4 , 5 , 6)
3. appellant contends presumption not rebutted. (Para 7 , 9)
4. respondent defends trial court's reasonable view. (Para 10)
5. limited interference with acquittal judgments. (Para 11 , 12 , 13)
6. complainant proved payment via defense witness. (Para 14 , 15 , 16 , 17)
7. section 139 presumption rebuttable by preponderance. (Para 18 , 19 , 20 , 21 , 22)
8. dishonour and notice service proved. (Para 23 , 24 , 25)
9. appeal allowed; accused convicted under section 138. (Para 26 , 27 , 28)

JUDGMENT :

Rakesh Kainthla, J.

The present appeal is directed against the judgment dated 28.2.2012, passed by learned Chief Judicial Magistrate, Bilaspur, H.P., vide which the respondent (accused before the learned Trial Court) was acquitted of the commission of an offence punishable under Section 138 of the Negotiable Instruments Act 1881 (NI Act). (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 appeal are that the complainant filed a complaint before the learned Trial Court for the commission of an offence punishable under Section 138 of the NI Act. It was asserted that the accused is the proprietor of M/s Banyal Hatcheries and Breeding Farm at Village Bhagatpur, P.O. Talai, Tehsil Jhandutta, District Bilaspur, H.P. He was taking feed on a credit basis from M/s Thakur Cattle and Poultry Feeds, Village Gauri, P.O. Rani Kotla, Tehsil Sadar, District Bilaspur, H.P. There was a dispute between the accused and the supplier Smt. Anjana Thakur, Proprietor of M/s Thakur Cattle and Poultry Feeds. The accused requested the complainant to intervene. The complainant paid Rs.1,50,000/- on behalf of the accused to Smt. Anjana Thakur, Proprietor of Thakur Cattle and Poultry Feeds. The accused issued a post- dated cheque in favour of the complainant for Rs.1,50,000/- to return the amount paid by the complainant. The complainant presented the cheque for its collection to the State Bank of India, Branch Talai, but it was dishonoured with an endorsement ‘insufficient funds’. The complainant issued a notice to the accused on 6.6.2007, asking him to repay the money; however, the accused failed to do so, hence a complaint was filed before the learned Trial Court for taking action as per law.

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 to be tried.

4. The complainant examined himself (AW1), Amar Singh (AW2) and Amar Nath (AW3).

5. The accused, in his statement, recorded under Section 313 of Cr.P.C., denied the complainant’s case in its entirety. He examined Anjana Thakur (DW1), Proprietor of M/s Thakur Cattle and Poultry Feed, in defence.

6. Learned Trial Court held that the complainant had not stated in his examination-in-chief that he had paid Rs.1,50,000/- to Smt. Anjana Thakur, Proprietor of M/s Thakur Cattle and Poultry Feeds which made his claim doubtful. He admitted in his cross-examination that Anjana Thakur is his wife. He did not produce any bills for the feed supplied by M/s Thakur Cattle and Poultry Feeds to the accused. No acknowledgement was placed on record to show that the notice was served upon the accused. The statement of Anjana Thakur also made the complainant’s case suspect. Hence, the accused was acquitted of the commission of an offence punishable under Section 138 of the NI Act.

7. Being aggrieved by the judgment passed by the learned Trial Court, the complainant has filed the present appeal, asserting that the learned Trial Court erred in acquitting the accused. It was wrongly held that no notice was received by the accused. The complainant stated this fact on oath,