Rajeev Kumar Vs Kamal Kumar

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2026:HHC:12743

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IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA

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Cr. Revision No.: 35 of 2025

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Reserved on: 19.03.2026. Decided on: 22.04.2026

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Rajeev Kumar Versus	...…. Petitioner
Kamal Kumar	…. Respondent
*Coram*
The Hon’ble Mr Justice Rakesh K	ainthla, Judge.
Whether approved for reporting?¹	No.
For the Petitioner :	Mr. Rocky, Advocate.
For the Respondent :	Mr. Malay Kaushal, Advocate

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Rakesh Kainthla, Judge

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The present revision is directed against the judgment dated 07.12.2024 passed by the learned Sessions Judge, Chamba, District Chamba, H.P. (learned Appellate Court) vide which judgment of conviction dated 08.07.2024 and order of sentence dated 29.07.2024 passed by the learned Judicial Magistrate, First Class, Dalhousie, District Chamba, H.P. (learned Trial Court) were upheld. (Parties shall hereinafter be referred to in the same

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Whether the reporters of the local papers may be allowed to see the Judgment?Yes.

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manner as they were arrayed before the learned Trial Court for convenience.)

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Briefly stated, the facts giving rise to the present revision are that the complainant filed a complaint before the learned Trial Court against the accused for the commission of an offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (in short, 'NI Act'). It was asserted that the parties were well known to each other. The accused approached the complainant in October, 2018 and asked for ₹ 85,000 to meet his domestic needs. The accused accepted the complainant’s request and paid him an amount of ₹ 85,000. The accused issued a cheque for ₹ 85,000 on 25^th February 2019 to discharge his legal liability. The complainant deposited the cheque in his bank, and it was dishonoured with an endorsement “insufficient funds'. The complainant issued a demand notice to the accused asking him to pay the amount within 15 days. Notice was served upon the accused, but he failed to pay the money. Hence, a complaint was filed before the learned Trial Court against the accused for taking action as per law.

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Learned Trial Court found sufficient reasons to summon the accused. When the accused appeared, a notice of

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accusation was put to him for the commission of an offence punishable under Section 138 of the NI Act, to which he pleaded not guilty and claimed to be tried.

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The complainant examined himself (CW1) to prove his complaint.

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The accused, in his statement recorded under section 313 Cr. P.C. denied the complainant’s case in its entirety. He stated that he had not issued any cheque, and the cheque did not bear his signature. He denied the receipt of any notice of demand. He claimed that a false complaint was made against him. He did not produce any evidence in his defence.

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Learned Trial Court held that the complainant’s version that the accused had issued a cheque of ₹85,000/- in his favour was proved. The cheque carries with it a presumption that it was issued for consideration in discharge of debt/liability. The accused failed to produce any evidence to rebut the presumption. The cheque was dishonoured with endorsement “insufficient funds”, and the notice was duly served upon the accused. All the ingredients of the commission of an offence punishable under Section 138 of the NI Act were duly satisfied. Hence, the learned Trial Court convicted the accused of the commission of an

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offence punishable under Section 138 of the NI Act, and sentenced him to undergo simple imprisonment for six months pay a compensation of ₹1,30,000/- and in default of payment of compensation to undergo further simple imprisonment for 30 days.

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Being aggrieved by the judgment and order passed by the learned Trial Court, the accused filed an appeal, which was decided by the learned Sessions Judge, Chamba (learned Appellate Court). The learned Appellate Court concurred with the findings recorded by the learned Trial Court that the complainant’s version that the accused had issued a cheque in his favour was duly proved, and a presumption arose that the cheque was issued for consideration to discharge the debt/liability. The accused did not produce any evidence to rebut the presumption. The cheque was dishonoured with the endorsement “insufficient funds”. Notice was duly served upon the accused, and he failed to repay the amount despite receipt of a valid notice of demand. The learned Trial Court had rightly convicted the accused. The sentence imposed by the learned Trial Court was adequate, and no inference was required with it. Hence, the appeal was dismissed.

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Being aggrieved by the judgments and order passed by the learned Courts below, the accused has filed the present revision asserting that the learned Courts below erred in appreciating the material placed before them. The complaint was barred by limitation. Therefore, it was prayed that the present revision be allowed and the judgments and order passed by the learned Courts below be set aside.

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I have heard Mr. Rocky, learned counsel for the petitioner/accused, and Mr Malay Kaushal, learned counsel for the respondent/complainant.

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Mr. Rocky, learned counsel for the petitioner/ accused, submitted that the learned Courts below erred in appreciating the material placed before them. The complaint was barred by limitation, and the notice was served beyond the statutory period. Hence, he prayed that the present revision be allowed and the judgments and order passed by the learned Courts below be set aside.

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Mr Malay Kaushal, Ld. counsel for the respondent/complainant, submitted that both the learned Courts below have concurrently held that the accused had issued the cheque in the complainant’s favour, which was dishonoured with

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an endorsement ‘insufficient funds’. The accused had failed to rebut the presumption attached to the cheque. This Court should not interfere with the concurrent finding of facts recorded by learned Courts below while exercising the revisional jurisdiction. Hence, he prayed that the present revision be dismissed.

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I have given a considerable thought to the submissions made at the bar and have gone through the records carefully.

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It was laid down by the Hon’ble Supreme Court in Malkeet Singh Gill v. State of Chhattisgarh , (2022) 8 SCC 204: (2022) 3 SCC (Cri) 348: 2022 SCC OnLine SC 786 that a revisional court is not an appellate court and it can only rectify the patent defect, errors of jurisdiction or the law. It was observed at page 207-

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“10. Before adverting to the merits of the contentions, at the outset, it is apt to mention that there are concurrent findings of conviction arrived at by two courts after a detailed appreciation of the material and evidence brought on record. The High Court in criminal revision against conviction is not supposed to exercise the jurisdiction like the appellate court, and the scope of interference in revision is extremely narrow. Section 397 of the Criminal Procedure Code (in short “CrPC”) vests jurisdiction to satisfy itself or himself as to the correctness, legality or propriety of any finding, sentence or order, recorded or passed, and as to the regularity of any proceedings of such inferior court. The object of the provision is to set right a

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patent defect or an error of jurisdiction or law. There has to be a well-founded error which is to be determined on the merits of individual cases. It is also well settled that while considering the same, the Revisional Court does not dwell at length upon the facts and evidence of the case to reverse those findings.

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This position was reiterated in State of Gujarat v.

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Dilipsinh Kishorsinh Rao, (2023) 17 SCC 688: 2023 SCC OnLine SC

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1294, wherein it was observed at page 695:

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“14. The power and jurisdiction of the Higher Court under Section 397 CrPC, which vests the court with the power to call for and examine records of an inferior court, is for the purposes of satisfying itself as to the legality and regularities of any proceeding or order made in a case. The object of this provision is to set right a patent defect or an error of jurisdiction or law or the perversity which has crept in such proceedings.

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15. It would be apposite to refer to the judgment of this Court in Amit Kapoor v. Ramesh Chander [Amit Kapoor v. Ramesh Chander, (2012) 9 SCC 460: (2012) 4 SCC (Civ) 687: (2013) 1 SCC (Cri) 986] , where scope of Section 397 has been considered and succinctly explained as under: (SCC p. 475, paras 12-13)

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“ 12 . Section 397 of the Code vests the court with the power to call for and examine the records of an inferior court for the purposes of satisfying itself as to the legality and regularity of any proceedings or order made in a case. The object of this provision is to set right a patent defect or an error of jurisdiction or law. There has to be a well-founded error, and it may not be appropriate for the court to scrutinise the orders, which, upon the face of it, bear a token of careful consideration and appear to be in accordance with law. If one looks into the various judgments of this Court, it emerges that the revisional jurisdiction can be invoked where the decisions under challenge are grossly erroneous,

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there is no compliance with the provisions of law, the finding recorded is based on no evidence, material evidence is ignored, or judicial discretion is exercised arbitrarily or perversely. These are not exhaustive classes, but are merely indicative. Each case would have to be determined on its own merits.

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13 . Another well-accepted norm is that the revisional jurisdiction of the higher court is a very limited one and cannot be exercised in a routine manner. One of the inbuilt restrictions is that it should not be against an interim or interlocutory order. The Court has to keep in mind that the exercise of revisional jurisdiction itself should not lead to injustice ex facie. Where the Court is dealing with the question as to whether the charge has been framed properly and in accordance with law in a given case, it may be reluctant to interfere in the exercise of its revisional jurisdiction unless the case substantially falls within the categories aforestated. Even the framing of the charge is a much-advanced stage in the proceedings under CrPC.”

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It was held in Kishan Rao v. Shankargouda , (2018) 8 SCC 165: (2018) 3 SCC (Cri) 544: (2018) 4 SCC (Civ) 37: 2018 SCC OnLine SC 651 that it is impermissible for the High Court to reappreciate the evidence and come to its conclusions in the absence of any perversity. It was observed at page 169:

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“12. This Court has time and again examined the scope of Sections 397/401 CrPC and the grounds for exercising the revisional jurisdiction by the High Court. In State of Kerala v. Puttumana Illath Jathavedan Namboodiri, (1999) 2 SCC 452: 1999 SCC (Cri) 275] , while considering the scope of the revisional jurisdiction of the High Court, this Court has laid down the following: (SCC pp. 454-55, para 5)

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5 . … In its revisional jurisdiction, the High Court can call for and examine the record of any proceedings

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to satisfy 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 a 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 reappreciate the evidence and come to its conclusion on the same when the evidence has already been appreciated by the Magistrate as well as the Sessions Judge in appeal, unless any glaring feature is brought to the notice of the High Court which would otherwise amount to a gross miscarriage of justice. On scrutinising the impugned judgment of the High Court from the aforesaid standpoint, we have no hesitation in concluding that the High Court exceeded its jurisdiction in interfering with the conviction of the respondent by reappreciating the oral evidence. …”

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13. Another judgment which has also been referred to and relied on by the High Court is the judgment of this Court in Sanjaysinh Ramrao Chavan v. Dattatray Gulabrao Phalke, (2015) 3 SCC 123: (2015) 2 SCC (Cri) 19] . This Court held that the High Court, in the exercise of revisional jurisdiction, shall not interfere with the order of the Magistrate unless it is perverse or wholly unreasonable or there is nonconsideration of any relevant material, the order cannot be set aside merely on the ground that another view is possible. The following has been laid down in para 14: (SCC p. 135)

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“ 14 . … Unless the order passed by the Magistrate is perverse or the view taken by the court is wholly unreasonable or there is non-consideration of any relevant material or there is palpable misreading of records, the Revisional Court is not justified in setting aside the order, merely because another view is possible. The Revisional Court is not meant to act as an appellate court. The whole purpose of

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the revisional jurisdiction is to preserve the power in the court to do justice in accordance with the principles of criminal jurisprudence. The revisional power of the court under Sections 397 to 401 CrPC is not to be equated with that of an appeal. Unless the finding of the court, whose decision is sought to be revised, is shown to be perverse or untenable in law or is grossly erroneous or glaringly unreasonable or where the decision is based on no material or where the material facts are wholly ignored or where the judicial discretion is exercised arbitrarily or capriciously, the courts may not interfere with the decision in exercise of their revisional jurisdiction.”

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This position was reiterated in Bir Singh v. Mukesh

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Kumar , (2019) 4 SCC 197: (2019) 2 SCC (Cri) 40: (2019) 2 SCC (Civ)

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309: 2019 SCC OnLine SC 13, wherein it was observed at page 205:

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“16. It is well settled that in the exercise of revisional jurisdiction under Section 482 of the Criminal Procedure Code, the High Court does not, in the absence of perversity, upset concurrent factual findings. It is not for the Revisional Court to re-analyse and re-interpret the evidence on record.

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17. As held by this Court in Southern Sales & Services v. Sauermilch Design and Handels GmbH, (2008) 14 SCC 457 , it is a well-established principle of law that the Revisional Court will not interfere even if a wrong order is passed by a court having jurisdiction, in the absence of a jurisdictional error. The answer to the first question is, therefore, in the negative.”

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The present revision has to be decided as per the parameters laid down by the Hon’ble Supreme Court.

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The ingredients of an offence punishable under Section 138 of the NI Act were explained by the Hon’ble Supreme

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Court in Kaveri Plastics v. Mahdoom Bawa Bahrudeen Noorul, 2025 SCC OnLine SC 2019 as under: -

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5.1.1. In K.R. Indira v. Dr. G. Adinarayana (2003) 8 SCC 300 , this Court enlisted the components, aspects and the acts, the concatenation of which would make the offence under Section 138 of the Act complete, to be these (i) drawing of the cheque by a person on an account maintained by him with a banker, for payment to another person from out of that account for discharge in whole/in part of any debt or liability, (ii) presentation of the cheque by the payee or the holder in due course to the bank, (iii) returning the cheque unpaid by the drawee bank for want of sufficient funds to the credit of the drawer or any arrangement with the banker to pay the sum covered by the cheque, (iv) giving notice in writing to the drawer of the cheque within 15 days of the receipt of information by the payee from the bank regarding the return of the cheque as unpaid demanding payment of the cheque amount, and (v) failure of the drawer to make payment to the payee or the holder in due course of the cheque, of the amount covered by the cheque within 15 days of the receipt of the notice.

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The complainant reiterated the contents of the complaint in his proof affidavit (Ex. CW1/A). He stated in his cross-examination that he was working as an agriculturist and earned ₹ 10,000 – 20,000 per annum from agricultural activities. The accused was his friend. He demanded the money in October 2018. No document was prepared regarding the advancement of the loan. No person was present at the time. He denied that the accused had handed over blank cheques to Jamna Devi. He denied that he had misused the blank cheque issued by the accused.

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The complainant’s cross-examination shows that the accused has not disputed the issuance of the cheque, as it was suggested to the complainant that the accused had issued blank signed cheques to Jamna Devi, which were misused by the complainant. It was laid down by the Hon'ble Supreme Court in APS Forex Services (P) Ltd. v. Shakti International Fashion Linkers (2020) 12 SCC 724 , that when the issuance of a cheque and signature on the cheque are not disputed, a presumption would arise that the cheque was issued in discharge of the legal liability. It was observed: -

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“9. Coming back to the facts in the present case and considering the fact that the accused has admitted the issuance of the cheques and his signature on the cheque and that the cheque in question was issued for the second time after the earlier cheques were dishonoured and that even according to the accused some amount was due and payable, there is a presumption under Section 139 of the NI Act that there exists a legally enforceable debt or liability. Of course, such a presumption is rebuttable. However, to rebut the presumption, the accused was required to lead evidence that the full amount due and payable to the complainant had been paid. In the present case, no such evidence has been led by the accused. The story put forward by the accused that the cheques were given by way of security is not believable in the absence of further evidence to rebut the presumption, and more particularly, the cheque in question was issued for the second time after the earlier cheques were dishonoured. Therefore, both the courts below have materially erred in not properly appreciating and considering the presumption in favour of the complainant that there exists a legally enforceable debt or liability as per Section

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139 of the NI Act. It appears that both the learned trial court as well as the High Court have committed an error in shifting the burden upon the complainant to prove the debt or liability, without appreciating the presumption under Section 139 of the NI Act. As observed above, Section 139 of the Act is an example of reverse onus clause and therefore, once the issuance of the cheque has been admitted and even the signature on the cheque has been admitted, there is always a presumption in favour of the complainant that there exists legally enforceable debt or liability and thereafter, it is for the accused to rebut such presumption by leading evidence.”

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It was laid down in N. Vijay Kumar v. Vishwanath Rao

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N., 2025 SCC OnLine SC 873 , wherein it was held as under:

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“6. Section 118 (a) assumes that every negotiable instrument is made or drawn for consideration, while Section 139 creates a presumption that the holder of a cheque has received the cheque in discharge of a debt or liability. Presumptions under both are rebuttable, meaning they can be rebutted by the accused by raising a probable defence.”

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A similar view was taken in Sanjabij Tari v. Kishore S.

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Borcar, 2025 SCC OnLine SC 2069 , wherein it was observed:

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“ONCE EXECUTION OF A CHEQUE IS ADMITTED, PRESUMPTIONS UNDER SECTIONS 118 AND 139 OF THE NI ACT ARISE

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In the present case, the cheque in question has admittedly been signed by the Respondent No. 1-Accused. This Court is of the view that once the execution of the cheque is admitted, the presumption under Section 118 of the NI Act that the cheque in question was drawn for consideration and the presumption under Section 139 of the NI Act that the holder of the cheque received the said cheque in discharge of a legally enforceable debt or liability arises against the accused. It is pertinent to

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mention that observations to the contrary by a two-Judge Bench in Krishna Janardhan Bhat v. Dattatraya G. Hegde, (2008) 4 SCC 54 , have been set aside by a three-Judge Bench in Rangappa (supra).

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This Court is further of the view that by creating this presumption, the law reinforces the reliability of cheques as a mode of payment in commercial transactions.

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Needless to mention that the presumption contemplated under Section 139 of the NI Act is rebuttable. However, the initial onus of proving that the cheque is not in discharge of any debt or other liability is on the accused/drawer of the cheque [See: Bir Singh v. Mukesh Kumar, (2019) 4 SCC 197 ].

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Thus, the Court has to start with the presumption

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that the cheque was issued in discharge of the liability for consideration, and the burden is upon the accused to rebut this presumption.

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It was submitted that the complainant did not produce any statement of account to prove his financial capacity to advance ₹ 85,000 to the accused. This submission will not help the accused. It was laid down by the Hon’ble Supreme Court in Tedhi Singh v. Narayan Dass Mahant , (2022) 6 SCC 735: 2022 SCC OnLine SC 302 that the complainant is not required to show his financial capacity unless it is challenged by sending a reply to the notice. It was observed at page 740:

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“10. The trial court and the first appellate court have noted that in the case under Section 138 of the NI Act, the complainant need not show in the first instance that he

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had the capacity. The proceeding under Section 138 of the NI Act is not a civil suit. At the time, when the complainant gives his evidence, unless a case is set up in the reply notice to the statutory notice sent, that the complainant did not have the wherewithal, it cannot be expected of the complainant to initially lead evidence to show that he had the financial capacity. To that extent, the courts in our view were right in holding on those lines….”

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It was submitted that the complainant did not

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produce any document to show that he had advanced the loan. No person was present at the time of advancing the loan, and his version that he had advanced ₹85,000/- to the accused was wrongly accepted by the learned Courts below. This submission will not help the accused. It was laid down by the Hon’ble Supreme Court in Uttam Ram v. Devinder Singh Hudan, (2019) 10 SCC 287: 2019 SCC OnLine SC 1361 , that a presumption under Section 139 of the NI Act would obviate the requirement to prove the existence of consideration. It was observed:

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“20. ThPe trial court and the High Court proceeded as if the appellant was to prove a debt before the civil court, wherein the plaintiff is required to prove his claim on the basis of evidence to be laid in support of his claim for the recovery of the amount due. An dishonour of a cheque carries a statutory presumption of consideration. The holder of the cheque in due course is required to prove that the cheque was issued by the accused and that when the same was presented, it was not honoured. Since there is a statutory presumption of consideration, the burden is on the accused to rebut the presumption that the cheque was issued not for any debt or other liability.”

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26. This position was reiterated in Ashok Singh v. State of

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U.P., 2025 SCC OnLine SC 706, wherein it was observed:

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“22. The High Court while allowing the criminal revision has primarily proceeded on the presumption that it was obligatory on the part of the complainant to establish his case on the basis of evidence by giving the details of the bank account as well as the date and time of the withdrawal of the said amount which was given to the accused and also the date and time of the payment made to the accused, including the date and time of receiving of the cheque, which has not been done in the present case. Pausing here, such presumption on the complainant, by the High Court, appears to be erroneous. The onus is not on the complainant at the threshold to prove his capacity/financial wherewithal to make the payment in discharge of which the cheque is alleged to have been issued in his favour. Only if an objection is raised that the complainant was not in a financial position to pay the amount so claimed by him to have been given as a loan to the accused, only then would the complainant would have to bring before the Court cogent material to indicate that he had the financial capacity and had actually advanced the amount in question by way of loan. In the case at hand, the appellant had categorically stated in his deposition and reiterated in the cross-examination that he had withdrawn the amount from the bank in Faizabad (Typed Copy of his deposition in the paperbook wrongly mentions this as ‘Firozabad’). The Court ought not to have summarily rejected such a stand, more so when respondent no. 2 did not make any serious attempt to dispel/negate such a stand/statement of the appellant. Thus, on the one hand, the statement made before the Court, both in examination-in-chief and crossexamination, by the appellant with regard to withdrawing the money from the bank for giving it to the accused has been disbelieved, whereas the argument on behalf of the accused that he had not received any payment of any loan amount has been accepted. In our decision in S. S.

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Production v. Tr. Pavithran Prasanth, 2024 INSC 1059 , we opined:

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‘ 8. From the order impugned, it is clear that though the contention of the petitioners was that the said amounts were given for producing a film and were not by way of return of any loan taken, which may have been a probable defence for the petitioners in the case, but rightly, the High Court has taken the view that evidence had to be adduced on this point which has not been done by the petitioners. Pausing here, the Court would only comment that the reasoning of the High Court, as well as the First Appellate Court and Trial Court, on this issue is sound. Just by taking a counter-stand to raise a probable defence would not shift the onus on the complainant in such a case, for the plea of defence has to be buttressed by evidence, either oral or documentary, which in the present case has not been done. Moreover, even if it is presumed that the complainant had not proved the source of the money given to the petitioners by way of loan by producing statement of accounts and/or Income Tax Returns, the same ipso facto, would not negate such claim for the reason that the cheques having being issued and signed by the petitioners has not been denied, and no evidence has been led to show that the respondent lacked capacity to provide the amount(s) in question. In this regard, we may make profitable reference to the decision in Tedhi Singh v. Narayan Dass Mahant, (2022) 6 SCC 735 :

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‘10. The trial court and the first appellate court have noted that in the case under Section 138 of the NI Act, the complainant need not show in the first instance that he had the capacity. The proceedings under Section 138 of the NI Act are not a civil suit. At the time, when the complainant gives his evidence, unless a case is set up in the reply notice to the statutory notice sent, that the complainant did not have the wherewithal, it cannot be expected of the complainant to initially lead evidence to show that he had the financial capacity. To that extent, the

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courts in our view were right in holding on those lines. However, the accused has the right to demonstrate that the complainant in a particular case did not have the capacity and therefore, the case of the accused is acceptable, which he can do by producing independent materials, namely, by examining his witnesses and producing documents. It is also open to him to establish the very same aspect by pointing to the materials produced by the complainant himself. He can further, more importantly, further achieve this result through the cross-examination of the witnesses of the complainant. Ultimately, it becomes the duty of the courts to consider carefully and appreciate the totality of the evidence and then come to a conclusion whether, in the given case, the accused has shown that the case of the complainant is in peril for the reason that the accused has established a probable defence. ’(emphasis supplied)’ (underlining in original; emphasis supplied by us in bold).

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A similar view was taken in Sanjay Sanjabij Tari v.

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Kishore S. Borcar, 2025 SCC OnLine SC 2069 , wherein it was observed:

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“21. This Court also takes judicial notice of the fact that some District Courts and some High Courts are not giving ef f ect to the presumptions incorporated in Sections 118 and 13 9 of the NI Ac t and are treating the proceedings under the NI Ac t as another civil recovery proceedings and are directing the complainant to prove the antecedent debt or liability. This Court is of the view that such an approach is not only prolonging the trial but is also contrary to the mandate of Parliament, namely, that the drawer and the bank must honour the cheque; otherwise, trust in cheques would be irreparably damaged.”

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In the present case, the accused denied in his crossexamination that he had taken the cheque from Jamna Devi, to whom the accused had handed over the blank security cheques. A denied suggestion does not amount to any proof. The accused did not step into the witness box to establish this version. It was held in Sumeti Vij v. Paramount Tech Fab Industries, (2022) 15 SCC 689: 2021 SCC OnLine SC 201 that the accused has to lead defence evidence to rebut the presumption and mere denial in his statement under section 313 Cr.P.C. is not sufficient to rebut the presumption. It was observed at page 700:

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“20. That apart, when the complainant exhibited all these documents in support of his complaints and recorded the statement of three witnesses in support thereof, the appellant recorded her statement under Section 313 of the Code but failed to record evidence to disprove or rebut the presumption in support of her defence available under Section 139 of the Act. The statement of the accused recorded under Section 313 of the Code is not substantive evidence of defence, but only an opportunity for the accused to explain the incriminating circumstances appearing in the prosecution's case against the accused. Therefore, there is no evidence to rebut the presumption that the cheques were issued for consideration ." (Emphasis supplied)”

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Therefore, the plea taken by the accused that the

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cheque was issued as security to Jamna Devi was rightly rejected by the learned Courts below.

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There is no other evidence to rebut the presumption attached to the cheque, and the learned Courts below rightly held that the accused had failed to rebut the presumption attached to the cheque.

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The complainant stated that the cheque had been dishonoured with the endorsement “insufficient funds”. This was duly proved by memo (Ex. CW-1/C) wherein the reason of dishonour was mentioned as “insufficient funds.” It was laid down by the Hon’ble Supreme Court in Mandvi Cooperative Bank Ltd. v. Nimesh B. Thakore , (2010) 3 SCC 83: (2010) 1 SCC (Civ) 625: (2010) 2 SCC (Cri) 1: 2010 SCC OnLine SC 155 that the memo issued by the Bank is presumed to be correct and the burden is upon the accused to rebut the presumption. It was observed at page 95:

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“24. Section 146, making a major departure from the principles of the Evidence Act, provides that the bank's slip or memo with the official mark showing that the cheque was dishonoured would, by itself, give rise to the presumption of dishonour of the cheque, unless and until that fact was disproved. Section 147 makes the offences punishable under the Act compoundable.”

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In the present case, no evidence was produced to

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rebut the presumption, and the learned Courts below had rightly held that the cheque was dishonoured with an endorsement ‘insufficient funds.’

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The complainant stated in his proof affidavit (Ex. CW1/A) that the registered letter containing the notice was duly served upon the accused. This was not challenged in the crossexamination. Therefore, the same is to be taken as correct, and learned Courts below had rightly held that the notice was duly served upon the accused.

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In any case, it was laid down in C.C. Allavi Haji vs. Pala Pelly Mohd. 2007(6) SCC 555, that the person, who claims that he had not received the notice has to pay the amount within 15 days from the date of the receipt of the summons from the Court and in case of failure to do so, he cannot take the advantage of the fact that notice was not received by him. It was observed:

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“It is also to be borne in mind that the requirement of giving notice is a clear departure from the rule of Criminal Law, where there is no stipulation of giving notice before filing a complaint. Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under Section 138 of the Act, make payment of the cheque amount and submit to the Court that he had made payment within 15 days of receipt of summons (by receiving a copy of the complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the Court along with the copy of the complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the G.C. Act and Section 114 of the Evidence Act . In our view, any

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other interpretation of the proviso would defeat the very object of the legislation. As observed in Bhaskaran’s case (supra), if the giving of notice in the context of Clause (b) of the proviso was the same as the receipt of notice, a trickster cheque drawer would get the premium to avoid receiving the notice by adopting different strategies and escape from the legal consequences of Section 138 of the Act.” (Emphasis supplied)

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The accused did not claim that he had repaid the amount to the complainant; therefore, it was duly proved on record that the accused had failed to repay the amount despite the receipt of the notice.

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It was submitted that the notice was served beyond 30 days of the memo of dishonour. This submission will not help the petitioner. The memo of dishonour was issued on 12.03.2019. The complainant stated that the memo was received by him 4-5 days after the delivery of the cheque. The notice was issued on 11.04.2019. The period of intimation has to be calculated from the date of receipt of the intimation of dishonour and not from the date of the issuance of the memo. In Sivakumar v. Natarajan , (2009) 13 SCC 623 , an intimation was received by the complainant on 03.12.2003, and he issued the notice on 02.01.2004. It was laid down by the Hon’ble Supreme Court that the notice has to be issued within 30 days of the receipt of the information. It was observed:-

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“10. We may, however, at the outset notice that both clauses ( a ) and ( b ) of the proviso appended to Section 138 of the Act employed the term “within a period”. Whereas clause ( a ) refers to the presentation of the cheque to the bank within a period of six months from the date on which it is drawn, clause ( b ) provides for the issuance of notice “to the drawer of the cheque, within thirty days of the receipt of information”. The words “within thirty days of the receipt of information” are significant. Indisputably, intimation was received by the respondent from the bank on 3-12-2003.

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This judgment was followed by the Delhi High Court

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in Deepak Nagar v. State, 2024 SCC OnLine Del 2053, and it was

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observed:-

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10. A Co-ordinate Bench of this Court in Dheeraj Jain v. State 2012 SCC OnLine Del 1687 , held as under: —

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“xxx

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8. A perusal of Clause (b) to proviso to the Section clearly states that nothing contained in the section shall apply unless the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the amount of cheque by giving a notice in writing to the drawer of the cheque within 30 days of the receipt of the information by him from the bank regarding return of the cheque as unpaid. It may be noted that in the present case, admittedly, as per the complaint, affidavit and legal notice, Respondent No. 2 came to know about the dishonour of the cheque on the 10^th of July, 2010. The demand made by Respondent No. 2 was beyond the period of 30 days, and now Respondent No. 2 cannot agitate that he be permitted to lead evidence to show that he received the knowledge of dishonour of the cheque on 12^th July 2012, which was not the case even before the learned Trial Court.

xxx”

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13. Concededly, as per the allegations in the complaint, respondent No. 2 had received information about the dishonour of the cheque on 16.03.2022, whereafter, he had telephonically informed the petitioner about the said dishonour. It is also not disputed that the legal notice was issued on 16.04.2022, and upon failure to repay, the present complaint came to be filed”

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Therefore, the notice was issued within the

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prescribed period, and the submission to the contrary cannot be accepted.

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Thus, it was duly proved before the learned Trial Court that the accused had issued a cheque to discharge his legal liability, the cheque was dishonoured with an endorsement ‘insufficient funds’, and the accused failed to pay the money despite the receipt of a notice of demand. Hence, all the ingredients of the offence punishable under Section 138 of the NI Act were duly satisfied, and the learned Trial Court had rightly convicted the accused for the commission of the offence punishable under Section 138 of the NI Act.

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Learned Trial Court sentenced the accused to undergo simple imprisonment for six months, pay compensation of ₹1,30,000/- to the complainant, and in default of payment of compensation to undergo further simple imprisonment of 30 days. It was laid down by the Hon’ble Supreme Court in Bir Singh

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v. Mukesh Kumar, (2019) 4 SCC 197: (2019) 2 SCC (Cri) 40: (2019) 2 SCC (Civ) 309: 2019 SCC OnLine SC 138 that the penal provision of section 138 is deterrent in nature. It was observed at page 203:

¶161

“6. The object of Section 138 of the Negotiable Instruments Act is to infuse credibility into negotiable instruments, including cheques, and to encourage and promote the use of negotiable instruments, including cheques, in financial transactions. The penal provision of Section 138 of the Negotiable Instruments Act is intended to be a deterrent to callous issuance of negotiable instruments such as cheques without serious intention to honour the promise implicit in the issuance of the same.”

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Keeping in view the deterrent nature of the punishment, the sentence of six months cannot be said to be excessive.

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In the present case, the cheque was issued on 25.02.2019, and the learned Trial Court awarded the compensation of ₹1,30,000/-, on 29.07.2024. Thus, the compensation was imposed after more than five years. It was laid down by the Hon’ble Supreme Court in Kalamani Tex v. P. Balasubramanian, (2021) 5 SCC 283: (2021) 3 SCC (Civ) 25: (2021) 2 SCC (Cri) 555: 2021 SCC OnLine SC 75 that the Courts should uniformly levy a fine up to twice the cheque amount along with simple interest at the rate of 9% per annum. It was observed at page 291: -

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As regards the claim of compensation raised on behalf of the respondent, we are conscious of the settled principles that the object of Chapter XVII of NIA is not only punitive but also compensatory and restitutive. The provisions of NIA envision a single window for criminal liability for the dishonour of a cheque as well as civil liability for the realisation of the cheque amount. It is also well settled that there needs to be a consistent approach towards awarding compensation, and unless there exist special circumstances, the courts should uniformly levy fines up to twice the cheque amount along with simple interest @ 9% p.a. [ R. Vijayan v. Baby, (2012) 1 SCC 260, para 20: (2012) 1 SCC (Civ) 79: (2012) 1 SCC (Cri) 520 ] ”

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Learned Trial Court had awarded compensation of ₹

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45,000/- on an amount of ₹ 85,000/-, which is equivalent to the interest and cannot be said to be excessive.

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It was submitted that the learned Trial Court could

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not have awarded the sentence of imprisonment in case of default in the payment of compensation. This submission is not acceptable. It was laid down by the Hon’ble Supreme Court in K.A.

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Abbas v. Sabu Joseph, (2010) 6 SCC 230: 2010 SCC OnLine SC 612

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that the Courts can impose a sentence of imprisonment in default of payment of compensation. It was observed at page 237:

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“26. From the above line of cases, it becomes very clear that a sentence of imprisonment can be granted for default in payment of compensation awarded under Section 357(3) CrPC. The whole purpose of the provision is to accommodate the interests of the victims in the criminal justice system. Sometimes the situation becomes such that there is no purpose served by keeping a person behind bars. Instead, directing the accused to pay an

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amount of compensation to the victim or affected party can ensure the delivery of total justice. Therefore, this grant of compensation is sometimes in lieu of sending a person to bars or in addition to a very light sentence of imprisonment. Hence, in default of payment of this compensation, there must be a just recourse. Not imposing a sentence of imprisonment would mean allowing the accused to get away without paying the compensation, and imposing another fine would be impractical, as it would mean imposing a fine upon another fine and therefore would not ensure proper enforcement of the order of compensation. While passing an order under Section 357(3), it is imperative for the courts to look at the ability and the capacity of the accused to pay the same amount as has been laid down by the cases above; otherwise, the very purpose of granting an order of compensation would stand defeated.”

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This position was reiterated in R. Mohan v. A.K. Vijaya

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Kumar, (2012) 8 SCC 721: 2012 SCC OnLine SC 486, wherein it was

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observed at page 729:

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“29. The idea behind directing the accused to pay compensation to the complainant is to give him immediate relief so as to alleviate his grievance. In terms of Section 357(3), compensation is awarded for the loss or injury suffered by the person due to the act of the accused for which he is sentenced. If merely an order directing compensation is passed, it would be totally ineffective. It could be an order without any deterrence or apprehension of immediate adverse consequences in case of its non-observance. The whole purpose of giving relief to the complainant under Section 357(3) of the Code would be frustrated if he is driven to take recourse to Section 421 of the Code. An order under Section 357(3) must have the potential to secure its observance. Deterrence can only be infused into the order by providing for a default sentence. If Section 421 of the Code puts compensation ordered to be paid by the court on a par with the fine so far as the mode of recovery is concerned, then there is no reason why the court cannot impose a sentence in default of payment of compensation, as it can be done in case of default in payment of a fine under Section 64 IPC. It is obvious

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that in view of this, in Vijayan [(2009) 6 SCC 652: (2009) 3 SCC (Cri) 296] , this Court stated that the abovementioned provisions enabled the court to impose a sentence in default of payment of compensation and rejected the submission that the recourse can only be had to Section 421 of the Code for enforcing the order of compensation. Pertinently, it was made clear that observations made by this Court in Hari Singh [(1988) 4 SCC 551: 1988 SCC (Cri) 984] are as important today as they were when they were made. The conclusion, therefore, is that the order to pay compensation may be enforced by awarding a sentence in default.

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30. In view of the above, we find no illegality in the order passed by the learned Magistrate and confirmed by the Sessions Court in awarding a sentence in default of payment of compensation. The High Court was in error in setting aside the sentence imposed in default of payment of compensation.

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