Petitioner challenged conviction in cheque dishonour case under NI Act dismissing appeal but reducing sentence from Rs 8.6 Lakhs to Rs 8 Lakhs as fine.
Sentence reduced to fine of Rs. 8 Lacs payable within six weeks; failure to pay incurs simple imprisonment for 1 year.
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CHANCHAL MEHTA .....Petitioner
Through: Ms. Somya Gupta and Mr. Dhananjay Yadav, Advs.
versus
STATE OF NCT OF DELHI & ANR. .....Respondent Through: Mr. Hemant Mehla, APP for the State Mr. Parvesh Chaudhary, Adv.
CORAM: HON'BLE MR. JUSTICE ANISH DAYAL
O R D E R
% 08.10.2024
This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 14/10/2024 at 10:30:00
furnishing the cheques is concerned, he asserts that the said cheques were misused as they were misplaced during construction.
“ 17. We often find that acquittals in Section 138 NI Act proceedings place the burden of proving the existence of the debt on the complainant, which is diametrically opposite to the presumption placed on the accused under Section 139 NI Act. The accused often gets away with an acquittal, despite having tendered and even admitting to the cheque, merely because the complainant is unable to produce documents to support the existence of the debt (usually in the form of a friendly loan provided in cash, which does not have any document trail). It would be unwise for the court to not acknowledge that friendly cash loans are provided by parties, sometimes based on small savings of the lender. In these circumstances rather than focusing on the question as to why the accused gave the cheque in the first place (which he or she admits), the
This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 14/10/2024 at 10:30:00
complainant is left unhinged for inability to provide any documentation. Often when accused is asked by the court, as to for what purpose they gave the cheque in the first place, a cogent and rational answer is not forthcoming.
18. Presumption under Section 139 read with Section 118 of the NI Act is essentially based on pure common sense. Instead of having the accused prove to the contrary, the accused is acquitted, as in this case, without having led any defence evidence and purely relying upon the inconsistencies in the affirmative proof provided by the complainant. The law and its application, is therefore turned on its head. ”
(emphasis added)
“ 22. The insistence of the respondent to deny the MoU which seems prima facie validly executed with reasonable detail, followed by tendering of 10 cheques of a total of Rs. 2.6 crores, seem untenable and not believable. If therefore, the MoU subsisted, then the basis for liability of balance amount calculated as Rs. 85 lakhs, would be alive. Once the cheques were tendered for Rs. 85 lakhs, the statutory presumption, would apply against the respondent under Section 139 of NI Act.
23. For this to be rebutted, it would require a plausible explanation from the respondent, that the cheques were not rendered for any liability. The respondent in this effort simply and boldly just denies the MoU itself, which to this Court, is not digestible.
24. Considering that respondent is denying execution of MoU, this Court finds his assertion
This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 14/10/2024 at 10:30:00
that Rs. 2.6 crores was given on an ‘understanding’ is not tenable or with any modicum of truth. A huge amount of Rs. 2.6 crores being advanced without any written understanding or agreement, particularly when it was backed by a commercial transaction, is a contention that seems unmerited and unbelievable. Moreover, the respondent’s contention that the amount was given only as security cheques, is also untenable in light of various decisions of this Court and other Courts in this regard. It is well settled, that a mere assertion that a cheque was given as security amount, must be proved by the accused under Section 138 NI Act proceedings, as statutory presumption works against the accused …”
(emphasis added)
This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 14/10/2024 at 10:30:00
opposed to Rs.8,60,000/- along with custody.
ANISH DAYAL, J
OCTOBER 8, 2024/MK/ tk
This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 14/10/2024 at 10:30:00
3 issues framed by the court
Whether the statutory presumption under Section 139 of the NI Act stands rebutted by the accused’s allegations.
Whether the trial court correctly applied the law regarding financial capability and reason for furnishing the cheque.
Whether the sentence of one year simple imprisonment is excessive given the plea for reduction.
Colour shows how this judgement treated each authority
Amit Jain v. Sanjeev Kumar Singh & Anr.Referred¶6
Amit Jain v. Sanjeev Kumar Singh & Anr. 2024:DHC:6207
Arun Kumar Gupta (D) THR-LRS v. Tama JawaharReferred¶22
Arun Kumar Gupta (D) THR-LRS v. Tama Jawahar 2024:DHC:7222
3 provisions across 1 enactments
Chanchal Mehta
State of NCT of Delhi and Another
Anish Dayal
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
