Admission of cheque triggers presumption under Sections 118(a),139 NI Act of enforceable debt; security cheque liable under Section 138 if subsisting liability exists; accused fails to rebut by preponderance; revisional jurisdiction limited, no reappreciation absent perversity.

JUDGMENT :

Rakesh Kainthla, J.

The present revision is directed against the judgment dated 22.02.2025, passed by learned Additional Sessions Judge (1), Shimla, H.P. (learned Appellate Court) vide which the judgment of conviction passed by learned Judicial Magistrate First Class, Court No.4, Shimla (learned Trial Court) and order of sentence dated 04.11.2023 passed by learned Chief Judicial Magistrate, District Shimla 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 petition are that the complainant filed a complaint against the accused before the learned Trial Court for the commission of an offence punishable under Section 138 of the Negotiable Instruments Act (in short, ‘NI Act’). It was asserted that the accused had borrowed Rs.12,00,000/- from the complainant between 10.05.2014 to 22.08.2014. He promised to repay the amount within one year and issued two cheques — one for Rs.5,00,000/- and another for Rs.7,00,000/— drawn on the Bank of Baroda, Kasumpti, to repay the amount. The complainant presented the cheque of Rs.7,00,000/- for encashment, but the bank dishonoured it with an endorsement ‘funds insufficient’. The complainant sent the legal notice to the accused, which was duly served upon him. The accused failed to repay the money. Hence, a complaint was filed against the accused for taking action 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 read with Section 142 of the NI Act, to which he pleaded not guilty and claimed to be tried.

4. The complainant examined himself (CW1) and Ganga Ram (CW2) to prove his case.

5. The accused, in his statement recorded under Section 313 of CrPC, admitted that he had issued a cheque in favour of the complainant. He claimed that the cheque was issued as security because he had borrowed Rs.1,00,000/- from the complainant. He had issued a cheque of Rs.1,00,000/-, but he had repaid Rs.2,00,000/- to the complainant and had no liability towards him. He admitted that he issued a receipt (Ext.CW-1/A) and clarified that it was issued as a guarantee, which was to be used on failure to repay the amount. The complainant misused the security cheques issued by the accused. He examined Santosh Kumar (DW1) and himself (DW2).

6. The learned Trial Court held that the accused admitted issuance of the cheque. He claimed that the cheque was issued as security. The admission of the signatures on the cheque and its issuance would give rise to a presumption under Section 118(a) and 139 of the NI Act that the cheque was issued for consideration to discharge the debt/liability. The plea taken by the accused that he had returned Rs.2,00,000/- was not proved. The accused had executed a receipt of Rs.12,00,000/- which falsified his plea that he had only taken Rs.1,00,000/- from the complainant. A securi