Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2025 Supreme(HP) 1392

IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
Rakesh Kainthla, J.
Sanjay Sen - Petitioner
Versus
Hira Lal & Anr. - Respondents
Cr. Revision No. 533 of 2025
Decided On : 30-10-2025

Advocates Appeared:
For the Petitioner:Mr. Sudhir Thakur, Senior Advocate.

Revisional court cannot re-appreciate evidence absent perversity; NI Act presumption u/s 139 rebuttable by preponderance of probabilities, accused's uncorroborated denial insufficient; notice returned refused/door locked deemed served; default imprisonment valid for compensation enforcement.

Headnote:(A) Negotiable Instruments Act, 1881 - Sections 118(a), 139 and 138 - Cr.P.C. - Sections 397, 313 and 357(3) - Cheque dishonour - Criminal revision against concurrent conviction and sentence under S.138 NI Act - Accused admitted receipt of advance and issuance of cheque but claimed return of part amount and misuse - Held: Revisional Court cannot re-appreciate evidence or act as appellate Court unless patent defect, jurisdictional error or perversity; scope limited to correctness, legality or propriety - Presumption arises u/s 118(a), 139 NI Act on admission of execution that cheque issued for discharge of debt/liability; rebuttable by preponderance of probabilities via probable defence or circumstantial evidence - Accused took contradictory pleas, led no evidence beyond statement u/s 313 CrPC which is not substantive evidence - Agreement to sell and unchallenged testimony of legal heir corroborate version - Cheque dishonoured for insufficient funds; bank memo presumed correct u/s 146 NI Act - Notice to correct address returned refused/door locked; deemed served u/s 27 General Clauses Act, burden on accused to rebut - All ingredients of S.138 NI Act satisfied - Sentence of 6 months simple imprisonment and compensation (cheque amount + interest for 9 years + costs) not excessive; uniform practice to award up to twice cheque amount with 9% interest - Default imprisonment valid to enforce compensation u/s 357(3) r/w Ss.431 CrPC, 64 IPC - Revision dismissed. (Paras 11, 16-39)

Facts of the case:
Complainant advanced Rs.3 lakhs by cheque and Rs.4.5 lakhs cash as advance under agreement to sell land; accused failed to execute sale deed despite promise, issued Rs.7.5 lakhs cheque which was dishonoured for insufficient funds; statutory notice deemed served, no repayment; complainant died, legal heir prosecuted; trial Court convicted with 6 months SI and Rs.11.7 lakhs compensation (default 1 month SI); upheld in appeal; revision filed alleging no proof of legal heir, financial capacity, rebuttal of advance return, improper reliance on agreement.

Findings of Court:
Presumptions duly raised and unrebutted; notice served; conviction and sentence proper; no interference warranted.

Issues: Scope of revisional jurisdiction u/s 397 CrPC; sufficiency of accused's defence to rebut presumption u/s 139 NI Act; proof of legal heir; validity of notice service; appropriateness of sentence, compensation and default stipulation.

Ratio Decidendi: Revisional jurisdiction supervisory, not appellate; intervenes only for gross perversity or jurisdictional error - Accused must rebut NI Act presumption by preponderance of probabilities, not mere denial; legal heir's oath unchallenged suffices; refused/locked door notice deemed served; compensation restitutive, enforceable by default imprisonment.

Result: Revision dismissed.

Table of Content
1. factual background of cheque dishonour complaint (Para 1 , 2 , 3 , 4 , 5)
2. lower courts upheld conviction under s.138 ni act (Para 6 , 7)
3. petitioner's challenge to conviction and evidence (Para 8 , 9)
4. limited scope of revisional jurisdiction (Para 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17)
5. presumption under ss.118/139 ni act applies (Para 18 , 19 , 20 , 21)
6. accused failed to rebut presumption (Para 22 , 23)
7. legal heir's testimony accepted (Para 24)
8. cheque dishonour presumed correct (Para 25 , 26)
9. notice deemed served on refusal/unclaimed (Para 27 , 28 , 29 , 30 , 31)
10. all s.138 ingredients satisfied (Para 32)
11. sentence and compensation justified (Para 33 , 34 , 35 , 36)
12. default imprisonment for compensation valid; revision dismissed (Para 37 , 38 , 39 , 40 , 41)

JUDGMENT :

Rakesh Kainthla, J.

The present revision is directed against the judgment dated 10.03.2025, passed by learned Sessions Judge, Kullu, H.P. (learned Appellate Court), vide which the judgment of conviction and order of sentence dated 04.10.2024 passed by learned Judicial Magistrate First Class, Manali, District Kullu (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 (NI Act). It was asserted that the accused entered into an agreement to sell the land situated in up-muhal Sarsai District Kullu, to the complainant. The complainant paid Rs.3,00,000/- by means of a cheque drawn on Punjab National Bank and Rs.4,50,000 in cash as an advance. The accused agreed to execute the sale deed on or before 31st July 2015. However, the accused failed to execute the sale deed on 31st July 2015, and he agreed to refund the advance amount received by him. He issued a cheque (Ex. CW-1/B) of Rs.7,50,000 drawn on Central Bank of India in favour of the complainant. The complainant presented the cheque to the bank, but it was dishonoured with an endorsement “funds insufficient” (Ext.CW-1/C). The complainant issued a notice (Ext.CW-1/E) asking the accused to repay the amount. The notice was duly served upon the accused. The accused failed to repay the amount. Hence, a complaint was filed before the learned Trial Court for taking action against the accused as per the 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 died during the pendency of the complaint. His legal heir, Yashwant, examined himself (CW-1) to prove his case.

5. The accused, in his statement recorded under Section 313 of Cr.P.C., admitted the receipt of Rs. 3,00,000/- from the complainant. He stated that he had returned the amount, but the cheque was misused by the complainant. He did not produce any evidence.

6. Learned Trial Court held that the accused did not dispute the signatures on the cheque in the complainant’s cross-examination; therefore, the presumption under Section 118(a) and Section 139 of the NI Act would arise that the cheque was issued for consideration to discharge the debt/liability. The burden would shift upon the accused to rebut the presumption. The accused had taken contradictory pleas. He had not adduced any evidence to prove his defence. There was nothing in the cross-examination of Yashwant to make it doubtful. Hence, the accused had not rebutted the presumption attached to the cheque. The cheque was dishonoured with an endorsement “insufficient funds”. The notice was sent to the correct address and is presumed to be served upon the accused. The accused failed to r