Dismissed¶57

Karan Pal v. Parvesh Kumar and Another

Himachal Pradesh HC8 Apr 2026CR.R/270/2023

Case brief

AI extract

What is this about?

Section 138 NI Act conviction upheld in criminal revision; security cheque dishonoured for insufficiency of funds; presumptions under Sections 118 and 139 NI Act not rebutted where accused leads no evidence; Section 313 Cr.P.C. admission of dishonour and notice; Section 391 Cr.P.C. additional evidence refused; scope of Section 397 Cr.P.C. revisional jurisdiction on concurrent findings; Karan Pal v. Parvesh Kumar, Cr. Revision No.270 of 2023, High Court of Himachal Pradesh (Sandeep Sharma, Judge), decided 08.04.2026; Laxmi Dyechem, Rangappa, Sripati Singh, Puttumana Illath and Krishnan v. Krishnaveni cited.

What did the court decide?

Both the courts below meticulously dealt with each and every aspect of the matter and the concurrent judgments of conviction and sentence leave no scope for interference. ¶18

Karan Pal Vs Parvesh Kumar and Another — Cheque Dishonour | Himachal Pradesh HC (2026)

What the court decided

AI extract

Outcome

Dismissed

¶57

Issue for consideration

Whether the judgments of conviction and sentence recorded by the courts below under Section 138 of the Negotiable Instruments Act warrant interference in this criminal revision. +4 more

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Court's answer

Both the courts below meticulously dealt with each and every aspect of the matter and the concurrent judgments of conviction and sentence leave no scope for interference.

¶18

Ratio / Principle

The accused, in his Section 313 Cr.P.C. statement, admitted the dishonour of the cheque on account of insufficient funds and did not deny receipt of the legal notice; his plea that the cheque was given as security was not probablized as he failed to avail the opportunity to lead defence evidence.

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Key takeaways

Once issuance of the cheque and signatures thereon were never disputed, the courts below rightly invoked the presumptions under Sections 118 and 139 of the Act; the accused failed to rebut them, despite sufficient opportunities, by leading no evidence.ratio¶22
No illegality was committed by the courts below in holding that the complainant successfully proved all the ingredients of Section 138 of the Act, the factum of issuance and receipt of the legal notice being undisputed.ratio¶35

Detailed headnote1 paragraphs

Criminal revision under Sections 397/401 Cr.P.C. against concurrent judgments of conviction under Section 138 of the Negotiable Instruments Act and sentence (simple imprisonment for two years and compensation of Rs.3,90,000/-): cheque No. 429111 for Rs. 3,50,000/-, issued under agreement dated 18.12.2015 towards truck-loan installments, was dishonoured with the remarks 'funds insufficient'. The accused admitted the dishonour and receipt of the legal notice in his Section 313 Cr.P.C. statement but led no defence evidence despite opportunity; the presumptions under Sections 118 and 139 of the Act were therefore rightly invoked and not rebutted. A cheque issued as security also attracts Section 138 (Sripati Singh v. State of Jharkhand relied upon), 'security cheque' being no statutorily defined expression and the Act carving out no exception for it. Revisional jurisdiction under Section 397 Cr.P.C. is supervisory and does not permit re-appreciation of evidence on concurrent findings (State of Kerala v. Puttumana Illath Jathavedan Namboodiri relied upon; Krishnan v. Krishnaveni distinguished, no material irregularity having been pointed out). Revision petition dismissed; petitioner directed to surrender before the trial Court within 15 days to serve the sentence; bail bonds cancelled and interim directions vacated.

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THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA

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Cr. Revision No.270 of 2023 Date of Decision: 08.04.2026

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______________________ Karan Pal	_________________________________ …….Petitioner Versus
Parvesh Kumar & another	… Respondents
______________________ Coram: Hon’ble Mr. Justice Sande Whether approved for reporti	_________________________________ ep Sharma, Judge. ng?¹
For the Petitioner :	Ms. Shrutika, Advocate vice Mr. Dheeraj K. Vashishta, Advocate.
For the Respondents :	Mr. Neeraj Maniktala, Advocate (through video conferencing), for respondent No.1.
	Mr. Rajan Kahol & Mr. Vishal Panwar, Additional Advocate Generals with Mr. Ravi Chauhan Deputy Advocate General, for the respondent/State.
_______________________ Sandeep Sharma, Judge (o	________________________________ ral):

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Instant Criminal Revision Petition filed under Section 397 read with Section 401 of the Code of Criminal Procedure, lays challenge to judgment dated 20.04.2023 passed by learned Additional Sessions Judge, Paonta Sahib, District Sirmour, Himachal Pradesh, in Criminal Appeal No.74-N/10 of 2019, affirming judgment of conviction dated 10.06.2019 and order of sentence dated 13.06.2019, passed by learned Judicial Magistrate, First Class, Court

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1 Whether the reporters of the local papers may be allowed to see the judgment?

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No.2, Paonta Sahib, District Sirmaur, Himachal Pradesh, in criminal case No.28 of 2017, titled Pravesh Kumar vs. Karan Pal, whereby learned trial Court, while holding petitioner-accused ( hereinafter referred to as the ‘accused’) guilty of his having committed an offence punishable under Section 138 of the Negotiable Instruments Act( for short ‘Act’), convicted and sentenced him to undergo simple imprisonment for a period of two years and pay compensation to the tune of Rs.3,90,000/- to the respondent-complainant.

¶8

Precisely, the facts of the case, as emerge from the pleadings as well as other documents adduced on record by the respective parties, are that respondent No.1-complainant (hereinafter referred to as the ‘complainant’) filed a complaint under Section 138 of the Act in the competent Court of law, alleging therein that he purchased a truck bearing registration No. HR-46C-7177 and aforesaid truck was financed by Shri Ram Finance Company. He alleged that due to some financial problem, he was unable to pay the monthly installments of the loan amount and as such, he expressed his desire to sell the aforesaid truck. He alleged that in December, 2015, accused approached him for purchase of truck and accordingly, an agreement was entered between him and accused on 18.12.2015. He alleged that in terms of afore agreement, accused promised to pay monthly installments of finance company and to secure installment,

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accused had issued cheque bearing No. 429111, amounting to Rs. 3, 50,000/-, drawn at State Bank of Patiala, Branch Paonta Sahib in favour of the complainant. However, accused defaulted in making payments, as a result thereof, complainant received notice from the Financer. Though, at first instance, complainant requested the accused to pay the monthly installment as agreed, but once he failed to do so, complainant presented the cheque of accused for encashment in the bank i.e. H.P. State Co-operative Bank Ltd. Branch Salwala Puruwala, Tehsil Paonta Sahib, but same was dishonoured with the remarks funds insufficient in the account of the accused vide memo dated 22.07.2016. After receipt of aforesaid return memo, complainant sent legal notice dated 10.08.2016 to the accused through registered letter, calling upon him to make the payment good within stipulated time, but since accused failed to make the payment good within stipulated time, complainant had no option, but to initiate proceedings under Section 138 of the Act in the competent Court of law, which subsequently, on the basis of evidence adduced on record by the respective parties, held the accused guilty of his having committed offence punishable under S. 138 of the Act and accordingly, convicted and sentenced him as per description given herein above.

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3. Being aggrieved and dissatisfied with the aforesaid

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judgment of conviction and order of sentence recorded by learned trial Court, present petitioner-accused preferred an appeal in the Court of learned Additional Sessions Judge, Paonta Sahib, District Sirmour, Himachal Pradesh, but same also came to be dismissed vide judgment dated 20.04.2023. In the aforesaid background, petitioneraccused has approached this Court in the instant proceedings, praying therein for his acquittal after quashing and setting aside the impugned judgment of conviction and order of sentence recorded by Courts below.

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Vide order dated 23.05.2023, this Court suspended the substantive sentence imposed by Court below, subject to petitioneraccused depositing 50% of the compensation amount and furnishing personal bonds in the sum of Rs. 20,000/- with one surety in the like amount to the satisfaction of learned trial Court within a period of six weeks. Aforesaid order has been duly complied with.

¶15

On 02.12.2024, learned counsel representing the petitioner informed this Court that sum of Rs. 1, 00,000/- has been deposited in the Registry of this Court. It also came to be undertaken at the behest of the petitioner-accused that remaining amount shall be deposited on or before the next date of hearing i.e. 09.01.2025, but fact remains that despite repeated opportunities, afore order never

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came to be complied with. More than 10 opportunities were granted to the petitioner to deposit the remaining amount, but in vain. Today, during the proceedings of the case, learned counsel representing the petitioner fairly stated that since petitioner is not coming forward to impart instructions and he has not complied with order passed by this Court, this Court may proceed to decide the petition on its own merits.

¶18

Having heard learned counsel representing the parties and perused material available on record vis-à-vis reasoning assigned in the impugned judgments of conviction and order of sentence recorded by Courts below, this Court is not persuaded to agree with learned counsel for the petitioner-accused that both the Courts below have failed to appreciate the evidence in its right perspective, rather this Court finds that both the courts below have meticulously dealt with each and every aspect of the matter and there is no scope left for interference.

¶19

In his statement recorded under Section 313 Cr.P.C accused admitted factum with regard to dishonour of the cheque on account of insufficient fund in his account. Similarly, he has also not denied factum with regard to his having received legal notice. He attempted to set up a defence that he had given the cheque as security and he had paid each and every installment of truck to the

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complainant. Though, accused was afforded opportunity to lead evidence in defence, but he failed to avail that opportunity.

¶22

Once factum with regard to issuance of cheque as well as signatures thereupon never came to be disputed at the behest of the accused, Courts below rightly invoked Sections 118 and 139 of the Act, which speak about presumption in favour of the holder of the cheque that cheque was issued towards discharge of lawful liability. No doubt, aforesaid presumption is rebuttable, but to rebut such presumption, accused either can refer to the documents and evidence led on record by the complainant or presumption can be rebutted by leading positive evidence, if any. However, in the instant case, despite sufficient opportunities, petitioner-accused failed to lead any evidence and as such, he otherwise failed to probablize the defence, sought to be raised by him, while deposing under Section 313 Cr.P.C.

¶23

The Hon’ble Apex Court in M/s Laxmi Dyechem V. State of Gujarat , 2013(1) RCR(Criminal), has categorically held that if the accused is able to establish a probable defence which creates doubt about the existence of a legally enforceable debt or liability, the prosecution can fail. To raise probable defence, accused can rely on the materials submitted by the complainant. Needless to say, if the accused/drawer of the cheque in question neither raises a probable defence nor is able to contest existence of a legally enforceable debt

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or liability, statutory presumption under Section 139 of the Negotiable Instruments Act, regarding commission of the offence comes into play. It would be profitable to reproduce relevant paras No.23 to 25 of the judgment herein:-

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“23. Further, a three judge Bench of this Court in the matter of Rangappa vs. Sri Mohan [3] held that Section 139 is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies the strong criminal remedy in relation to the dishonour of the cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. The Court however, further observed that it must be remembered that the offence made punishable by Section 138can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose money is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the defendant accused cannot be expected to discharge an unduly high standard of proof”. The Court further observed that it is a settled position that when an accused has to rebut the presumption under Section 139, the standard of proof for doing so is all preponderance of probabilities.

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24. Therefore, if the accused is able to establish a probable defence which creates doubt about the existence of a legally enforceable debt or liability, the prosecution can fail. The accused can rely on the materials submitted by the complainant in order to raise such a defence and it is inconceivable that in some cases the accused may not need to adduce the evidence of his/her own. If however, the accused/drawer of a cheque in question neither raises a probable defence nor able to contest existence of a legally enforceable debt or liability, obviously statutory presumption under Section 139 of the NI Act regarding commission of the offence comes into play if the same is not rebutted with regard to the materials submitted by the complainant.

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25. It is no doubt true that the dishonour of cheques in order to qualify for prosecution under Section 138 of the NI Act precedes a statutory notice where the drawer is called upon by allowing him to avail the opportunity to arrange the payment of the amount covered by the

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cheque and it is only when the drawer despite the receipt of such a notice and despite the opportunity to make the payment within the time stipulated under the statute does not pay the amount, that the said default would be considered a dishonour constituting an offence, hence punishable. But even in such cases, the question whether or not there was lawfully recoverable debt or liability for discharge whereof the cheque was issued, would be a matter that the trial court will have to examine having regard to the evidence adduced before it keeping in view the statutory presumption that unless rebutted, the cheque is presumed to have been issued for a valid consideration. In view of this the responsibility of the trial judge while issuing summons to conduct the trial in matters where there has been instruction to stop payment despite sufficiency of funds and whether the same would be a sufficient ground to proceed in the matter, would be extremely heavy.

¶31

Complainant, with a view to prove his case examined

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himself as CW-1 and tendered his evidence by way of affidavit Ex.CW1/A, wherein he specifically reiterated the averments contained in the complaint. He also tendered in evidence cheque Ex. CW-1/B, return memo Ex. CW1/C and Ex. CW1/D, legal notice Ex. CW1/E and postal receipt Ex. CW1/F. Cross-examination conducted upon this witness, if perused in its entirety, nowhere suggests that accused was able to extract anything contrary to what this witness stated in his examination-in-chief. In cross-examination, this witness claimed that he got financed the truck from Shree Ram Finance Company and was a second hand truck for Rs. 5, 72,000/- and he sold the truck to the accused for Rs. 6, 50,000/-. He further stated that accused had not paid any money at that time of purchasing of aforesaid truck. He stated that he had to pay Rs. 1, 50,000/- to the finance company after payment of all the installments on behalf of the accused and when he

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sold the truck, 3-4 installments of the truck was unpaid. He admitted the suggestion put to him that he had not paid the unpaid installments of the truck to finance company.

¶35

As has been noticed hereinabove, accused in his statement recorded under Section 313 Cr.P.C., nowhere denied factum of dishonouring of cheque on account of insufficient fund in his bank account. Though, pattern of cross-examination suggests that accused attempted to carve out case that cheque in question was issued as security, but he was unable to probablize aforesaid defence by leading cogent and convincing evidence. Since in the case at hand, factum of issuance of legal notice as well as receipt thereof was never disputed by the petitioner-accused, as such, no illegality can be said to have been committed by the learned courts below, while retuning a finding that complainant had successfully proved all the ingredients of Section 138 of the Act.

¶36

Once factum with regard to issuance of cheque as well as signatures thereupon never came to be disputed, no illegality can be said to have been committed by Courts below, while invoking Sections 118 and 139 of the Act, which speak about presumption in favour of the holder of the cheque that cheque was issued towards discharge of lawful liability. No doubt, aforesaid presumption is rebuttable, but to rebut such presumption, accused either can refer to

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the documents and evidence led on record by the complainant or presumption can be rebutted by leading positive evidence, if any. However, in the instant case, despite sufficient opportunities, petitioner-accused failed to lead any evidence and as such, he otherwise failed to probablize the defence, sought to be raised by him, while deposing under Section 313 Cr.P.C.

¶39

In the case at hand, accused filed an application under Section 391of Cr.P.C to produce/examine the additional witnesses to the written agreement dated 18.12.2015 and the agreement was that if the installment were left out only then said cheques were to be used to pay the installments and the cheques were given as security cheque. Afore prayer made on behalf of the accused was contested on the ground that allowing afore application would amount to denovo trial. Once agreement was in the knowledge of the accused and he did not put it to the complainant or brought the said defence, application filed at the behest of the accused under aforesaid provisions of law rightly came to be dismissed.

¶40

By now it is well settled that dishonour of cheque issued as “security” can also attract offence under Section 138 of the Negotiable Instruments Act. Hon’ble Apex Court in case titl ed Sripati Singh v. State of Jharkhand , Criminal Appeal No. 1269-1270 of 2021, decided on 28.10.2021, has held as under:

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“16. A cheque issued as security pursuant to a financial transaction cannot be considered as a worthless piece of paper under every circumstance. ‘Security’ in its true sense is the state of being safe and the security given for a loan is something given as a pledge of payment. It is given, deposited or pledged to make certain the fulfilment of an obligation to which the parties to the transaction are bound. If in a transaction, a loan is advanced and the borrower agrees to repay the amount in a specified timeframe and issues a cheque as security to secure such repayment; if the loan amount is not repaid in any other form before the due date or if there is no other understanding or agreement between the parties to defer the payment of amount,

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the cheque which is issued as security would mature for presentation and the drawee of the cheque would be entitled to present the same. On such presentation, if the same is dishonoured, the consequences contemplated under Section 138 and the other provisions of N.I. Act would flow.

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Needless to say, expression “security cheque” is not a statutorily defined expression in the Negotiable Instruments Act, rather same is to be inferred from the pleadings as well as evidence, if any, led on record with regard to issuance of security cheque. The Negotiable Instruments Act does not per se carve out an exception in respect of a “security cheque” to say that a complaint in respect of such a cheque would not be maintainable as there is a debt existing in respect whereof the cheque in question is issued, same would attract provision of Section 138 of the Act in case of its dishonour.

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Having scanned the entire evidence adduced on record by the respective parties, this Court finds that all the basic ingredients of Section 138 of the Act are met in the case at hand. Similarly, factum with regard to signatures and issuance of cheque by the

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accused towards discharge of lawful liability stands duly established on record.

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Moreover, this Court has a very limited jurisdiction under Section 397 of the Cr.P.C, to re-appreciate the evidence, especially, in view of the concurrent findings of fact and law recorded by the courts below. In this regard, reliance is placed upon the judgment passed by Hon’ble Apex Court in case “State of Kerala Vs. Puttumana Illath Jathavedan Namboodiri” ( 1999) 2 Supreme Court Cases 452, wherein it has been held as under:-

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“In its revisional jurisdiction, the High Court can call for and examine the record of any proceedings for the purpose of satisfying itself as to the correctness, legality or propriety of any finding, sentence or order. In other words, the jurisdiction is one of supervisory jurisdiction exercised by the High Court for correcting miscarriage of justice. But the said revisional power cannot be equated with the power of an appellate court nor can it be treated even as a second appellate jurisdiction. Ordinarily, therefore, it would not be appropriate for the High Court to re-appreciate the evidence and come to its own conclusion on the same when the evidence has already been appreciated by the Magistrate as well as Sessions Judge in appeal, unless any glaring feature is brought to the notice of the High Court which would otherwise tantamount to gross miscarriage of justice.”

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Since after having carefully examined the evidence in the

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present case, this Court is unable to find any error of law as well as

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fact, if any, committed by the courts below, while passing impugned judgments, there is no occasion, whatsoever, to exercise the revisional power.

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True it is that the Hon’ble Apex Court in Krishnan and another Versus Krishnaveni and another, (1997) 4 Supreme

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Court Case 241 ; has held that in case Court notices that there is a failure of justice or misuse of judicial mechanism or procedure, sentence or order is not correct, it is salutary duty of the High Court to prevent the abuse of the process or miscarriage of justice or to correct irregularities/ incorrectness committed by inferior criminal court in its judicial process or illegality of sentence or order, but learned counsel representing the accused has failed to point out any material irregularity committed by the courts below while appreciating the evidence and as such, this Court sees no reason to interfere with the well reasoned judgments passed by the courts below.

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Consequently, in view of the discussion made herein above as well as law laid down by the Hon’ble Apex Court, this Court sees no valid reason to interfere with the well reasoned judgments recorded by the courts below, which otherwise, appear to be based upon proper appreciation of evidence available on record and as such, same are upheld.

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Accordingly, the present criminal revision petition is dismissed being devoid of any merit. The petitioner is directed to surrender himself before the learned trial Court within a period of 15 days to serve the sentence as awarded by the learned trial Court, if not already served. Bail bonds of the petitioner are cancelled. Interim

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direction, if any, stands vacated. Pending applications, if any, also

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stand disposed of.

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(Sandeep Sharma), Judge

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April 08, 2026

¶63

(shankar)

Issues for consideration

5 issues framed by the court

AI extract

1.
Whether the judgments of conviction and sentence recorded by the courts below under Section 138 of the Negotiable Instruments Act warrant interference in this criminal revision.¶18
The court held
Both the courts below meticulously dealt with each and every aspect of the matter and the concurrent judgments of conviction and sentence leave no scope for interference.ratio¶18
2.
Whether the accused rebutted the presumptions under Sections 118 and 139 of the Negotiable Instruments Act that the cheque was issued towards discharge of a lawful liability.¶22
The court held
The accused, in his Section 313 Cr.P.C. statement, admitted the dishonour of the cheque on account of insufficient funds and did not deny receipt of the legal notice; his plea that the cheque was given as security was not probablized as he failed to avail the opportunity to lead defence evidence.ratio¶19
3.
Whether dishonour of a cheque issued as security attracts offence under Section 138 of the Negotiable Instruments Act.¶40
The court held
It is well settled that dishonour of a cheque issued as security can also attract offence under Section 138 of the Negotiable Instruments Act (Sripati Singh v. State of Jharkhand relied upon).ratio¶40
4.
Whether the accused was entitled to lead additional evidence under Section 391 Cr.P.C. by producing/examining witnesses to the written agreement dated 18.12.2015.¶39
The court held
The accused's application under Section 391 Cr.P.C. to examine additional witnesses to the agreement dated 18.12.2015 was rightly dismissed, the agreement being in his knowledge and the said defence never having been put to the complainant.ratio¶39
5.
Whether the High Court can re-appreciate the evidence in exercise of revisional jurisdiction under Section 397 Cr.P.C. against the concurrent findings of the courts below.¶48
The court held
The revisional jurisdiction under Section 397 Cr.P.C. is supervisory and very limited; ordinarily the High Court should not re-appreciate evidence already appreciated by the Magistrate and the Sessions Judge in appeal, in view of the concurrent findings (State of Kerala v. Puttumana Illath Jathavedan Namboodiri relied upon).ratio¶48

Karan Pal v. Parvesh Kumar and Another

Case brief

What is this about?

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Karan Pal v. Parvesh Kumar and Another

Case brief

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