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2025 Supreme(Online)(Del) 2735
IN THE HIGH COURT OF DELHI AT NEW DELHI
Sanjeev Narula, J
Okara Roadlines – Appellant
Versus
Punjab Freight Carriers Pvt. Ltd. – Respondent
CRL.L.P. 72/2020 | CRL.M.A. 8515/2022 | CRL.L.P. 73/2020 | CRL.L.P. 74/2020
For the Appellants/Petitioners: Abhdesh Chaudhary, Ritik Malik, Akhil Suri, Udit Thakrar, Geetanjali Setia
For the Respondents: Vikrant Singh, Gandharv Anand
The statutory presumption under Sections 118 and 139 of the NI Act is rebuttable on a preponderance of probabilities. Once a probable defense is raised, the burden shifts to the complainant to prove the legally enforceable debt as a matter of fact.
Headnote:(A) Negotiable Instruments Act, 1881 - Sections 118 and 139 - Presumption of existence of legally enforceable debt - Standard of proof for rebuttal - Accused is not required to prove the negative but only to raise a probable defense on a preponderance of probabilities - Once the accused meets this threshold, the evidentiary burden shifts back to the complainant to prove the existence of the debt as a matter of fact; failure to do so results in the dismissal of the complaint (Paras 11, 12 and 13).
(B) Indian Evidence Act, 1872 - Section 34 - Admissibility of electronic records - Vague, unsubstantiated computer-generated Excel sheets lacking company stamps or authorized signatures cannot be considered sufficient evidence to prove a legally enforceable debt (Para 21).
(C) Rebuttal of statutory presumption - Failure of the complainant to specify the mode of payment, lack of recording of alleged substantial cash investments in Income Tax Returns, and the existence of documentary discrepancies regarding the timeline of an acknowledgment letter constitute a probable defense in favor of the accused (Paras 17, 18 and 22).
Facts of the case:
A partnership firm filed complaints under Section 138 of the Negotiable Instruments Act, alleging that it had invested a substantial sum in a private limited company. Cheques representing the principal and interest were issued by the company, but were dishonoured upon presentation with the notation "payment stopped". The respondents contended that no such investment was made and that the cheques had been lost or stolen from their office. The Trial Court acquitted the respondents, ruling that the statutory presumption under the Act had been rebutted.
Findings of Court:
The court found that the respondents successfully rebutted the statutory presumptions on a preponderance of probabilities. The petitioner failed to provide any proof of the mode of payment for the alleged cash investment, and the investment was not reflected in the firm's financial accounts or tax returns. Furthermore, an acknowledgment letter relied upon by the petitioner was found to be dubious, as postal records showed it was physically impossible for the signatory to have delivered the letter in person on the date claimed.
Issues: Whether the respondents had raised a probable defense to rebut the statutory presumptions under Sections 118 and 139 of the Negotiable Instruments Act and whether the petitioner proved the existence of a legally enforceable debt after the burden shifted.
Ratio Decidendi: Once the accused establishes a probable defense through a preponderance of probability, the statutory presumption disappears, and the onus shifts to the complainant to prove the debt as a matter of fact. In the absence of credible documentary evidence, such as ITRs or proven payment modes, the complainant cannot sustain the claim of a legally enforceable debt.
Result: The present petition is dismissed along with pending application.
JUDGMENT
SANJEEV NARULA, J. (Oral):
1. The present petitions under Section 378(4) of the Code of Criminal Procedure, 1973, (“Cr.P.C”.), seek leave to appeal against separate orders of acquittal, all of which are dated 31st October, 2019, (“Impugned orders”.), passed by the MM, NI Act-3, Tis Hazari Courts, Delhi, in three separate Criminal complaints filed by the Petitioner under Section 138 of the Negotiable Instrument Act, 1881 , (“NI Act”.). The relevant details of the Criminal complaint cases are as follows:
| Present Crl.L.P No. | Arising from Complaint case No. | No. of cheques in the complaint | Date of order of Impugned order | Cumulative Amount of the cheques (INR) | Allegedly Issued towards |
| CRL.L.P. 72/2020 | CC No. 22707/2016 | 1 | 31.10.2019 | 30,00,000/- | Principal Amount |
| CRL.L.P. 73/2020 | CC No. 22706/2016 | 3 | 31.10.2019 | 80,00,000/- | Principal Amount |
| CRL.L.P. 74/2020 | CC No. 23435/2016 | 14 | 31.10.2019 | 30,80,000/- | Interest/profit |
2. Since all the aforementioned criminal complaints stem from the same underlying transaction, and the factual matrix as well as the grounds of challenge in these appeals are substantially identical, the present leave to appeals are being decided through this common order. For ease of reference, the evidence led by the parties is cited hereinafter based on the documents marked in CC No. 22707/2016 (impugned in CRL.L.P. 72/2020).
FACTUAL MATRIX
3. Briefly, the essential background facts set up by the Petitioner before the Trial Court, are as follows:
3.1 The Petitioner, a registered partnership firm is represented by Authorised Representative/Partner of the firm, Mr. Bhim Sain Wadhwa, who is well conversant with the facts of the case.
3.2 The Respondent No.1 (identified as Accused no. 1 in the impugned order), M/s Punjab Freight Carriers Pvt. Ltd. and its directors, Respondents No. 2 to 6 (identified as Accused no. 2 to 6 in the impugned order) have maintained a longstanding and cordial business relationship with the Petitioner spanning over three decades. Mr. Bhim Sain Wadhwa, being engaged in the same line of business, was well acquainted with the Respondent firm.
3.3 On the basis of this established relationship, Respondents No. 2 to 6 secured the trust and confidence of Mr. Bhim Sain Wadhwa, thereby inducing and persuading him to invest in Respondent No. 1, under the assurance of receiving a fixed profit in the form of interest. Consequently, the Petitioner firm invested an aggregate amount of INR 1.10 Crores in Respondent No. 1 through transactions facilitated by Respondents No. 2 to 6.
3.4 These investments were made from time to time on different dates and occasions, starting from 10th September, 2013 to 30th June, 2014. All of the said investments made by the Petitioner firm were duly acknowledged and confirmed by the Respondents in writing, through their Manager – i.e., Respondent No. 6, who routinely transmitted financial documents, such as Balance Sheets, Profit & Loss Accounts, D.O. accounts etc., to the Chief Auditor of the Petitioner firm, thereby confirming the Respondent’s liability of INR 1.10 Crores to the Petitioner firm. Reliance is placed on the statement of accounts with Cover Letter dated 4th October, 2015 and Cover Letter dated 5th May, 2016, sent by Respondent No. 6 (Manager and Authorised Signatory of Respondent No. 1) to the Chief Auditor of the Petitioner firm [marked as Exhibit - CW-1/2(Colly)]. Moreover, Respondent No. 1, through one of its partners – i.e., Respondent No. 3, also provided a written acknowledgement and confirmation, to the Petitioner firm, specifying that as on 19th September, 2014, a sum of INR 1,25,15,537/- was due as balance to the Partner of the Petitioner firm (marked as Exhibit - CW – 1/3).
3.5 The Respondents undertook to pay the Petitioner firm a fixed monthly profit of INR 2,20,000 in lieu of the INR 1.10 Crores investment, with the understanding that the principal amount would be repaid in full by the end of December, 2015. However, failing to adhere
