Issuance of a cheque acknowledges debt, creating enforceable liability even if debt is time-barred.

2. Briefly stated, the Respondent/Complainant filed a Complaint under Section 138 NI Act alleging that he had advanced a friendly loan of Rs.25,00,000/- to the Petitioner/Accused for his construction business. As security for the said loan, the Petitioner mortgaged his property bearing No. XV-5352/A, Shora Kothi, Pahar Ganj, New Delhi, vide Mortgage Deed dated 25.07.2013.

3. In discharge of his liability, the Petitioner issued two cheques; one Cheque No. 011966 dated 24.08.2018 for Rs. 25,00,000/- towards the principal amount and Cheque No. 113611 dated 16.08.2018 for Rs.14,00,000/- towards the interest. Upon presentation, both the cheques were returned unpaid with the remark “Funds Insufficient” vide Bank Return Memos dated 28.08.2018.

4. Despite service of statutory Legal Notice dated 17.09.2018 by the Respondent, the Petitioner failed to make the payment within the time period, leading the Respondent to file the Criminal Complaint under S.138 NI Act, on 18.10.2018.

5. The learned Trial Court took cognizance and framed Notice under Section 251 Cr.P.C . to which the Petitioner herein pleaded not guilty and claimed trial. His primary defense was that the Cheques were given as security; the entire loan amount had been repaid and the respondent had misused the cheques.

6. After the conclusion of the trial, the learned MM in the impugned judgement found the Petitioner’s defence to be unsubstantiated and the petitioner was convicted for the offence under Section 138 of the NI Act, vide judgment dated 18.11.2023. By Order On Sentence dated 22.11.2023, the petitioner was sentenced to imprisonment Till the Rising of the Court and was directed to pay compensation of Rs. 75,00,000/-.

7. Aggrieved by the said Judgment of conviction and sentence, the petitioner preferred an Appeal bearing CA No. 276/2023 before the learned Additional Sessions Judge. The learned ASJ, upon re-appreciating the evidence and arguments, concurred with the findings of the learned MM and dismissed the Appeal vide a detailed judgment dated 23.01.2025.

8. Aggrieved, the petitioner has filed the present Revision Petition to challenge his conviction and sentence.

9. The main grounds of challenge are that the loan was advanced under a Mortgage Deed dated 25.07.2013, which stipulated that the amount was to be repaid on or before 23.07.2014. The limitation period of three years to enforce this debt expired on 22.07.2017, whereas the Cheques were presented in August, 2018. Both the Courts have failed to appreciate that the cheques in question were issued in respect of a debt that was hopelessly barred by limitation and therefore, was not a “legally enforceable debt”.

10. It is further submitted that the ld. Trial Courts erred in ignoring crucial evidence, including the terms of the original Mortgage Deed (Mark A) and admissions made by the respondent during cross-examination regarding the timeline of the loan and a subsequent Demand Letter dated 10.06.2015, Ex. CW-1/A3, which itself established that the legal debt continued to exist even after the due date as per Mortgage Deed of 2014.

11. It is further contended that the Cheques were handed over as Security in 2013 and were subsequently misused by the Respondent in 2018.

12. The Petitioner further claims that the courts did not give due weight to the testimony of the defense witness DW1/Shri Nitesh Sriv