A cheque-dishonour conviction under Section 138 NI Act upheld in revision. Courts below correctly invoked statutory presumptions; accused failed to rebut them or substantiate his claim that the cheque went to a third party or served as mere security. Revision dismissed and petitioner directed to surrender to serve sentence.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
Cr. Revision No.617 of 2024 Date of Decision: 18.03.2026
__________________________________________________________________________ Rangeen Kumar ……...Petitioner Versus Saurabh Mehra and Another …....Respondents Coram Hon’ble Mr. Justice Sandeep Sharma, Judge. Whether approved for reporting? Yes. For the Petitioner: Mr. Atul Kumar, Advocate, vice Mr. Munish Dhatwalia, Advocate. For the Respondent: Mr. Anil Kapoor, Advocate, for respondent No.1. Mr. Vishal Panwar, learned Additional Advocate General, for State. __________________________________________________________________________ Sandeep Sharma, J. (Oral)
Instant criminal revision petition filed under Section 438 of the BNSS, 2023, lays challenge to judgment dated 06.08.2024, passed by the learned Sessions Judge, Chamba, District Chamba, Himachal Pradesh, in Criminal Appeal No.29 of 2024, titled Sh. Rangeen Kumar Vs. Saurabh Mehra , affirming judgment of conviction and order of sentence dated 22.02.2024/28.02.2024, passed by the learned Judicial Magistrate First Class, Dalhousie, District Chamba, Himachal Pradesh, in complaint registration No.03/2021, whereby the learned trial Court while holding the petitioner-accused (hereinafter, “ accused” ) guilty of having committed offence punishable under Section 138 of the Negotiable Instruments Act (in short the “Act"), convicted and sentenced him to undergo simple
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imprisonment for a period of one year and pay compensation to the tune of Rs.4,00,000/- to the respondent-complainant.
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at liberty to get the judgment of learned trial Court executed in accordance with law.
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which speak about presumption in favour of the holder of the Cheque that Cheque was issued towards discharge of a 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 case at hand, accused was unable to point out from the documents as well as evidence adduced on record by the complainant that Cheque issued by him was not towards discharge of lawful liability.
10. 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 able to contest existence of a legally enforceable debt or liability, statutory presumption under Section 139 of the Negotiable Instruments Act, regarding commission of the ofence f comes into play. It would be proftable to reproduce relevant paras No.23 to i 25 of the judgment herein:-
“23. Further, a three judge Bench of this Court in the matter of Rangappa vs. Sri Mohan [3] held that Section
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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.
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
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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.
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 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 ofence, hence punishable. But f 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 suf fi ciency of funds and whether the same would be a suf fi cient ground to proceed in the matter, would be extremely heavy.”
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tendered documentary evidence such as Cheque Ex.CW1/B, return memo Ex.CW1/C, legal notice Ex.CW1/D and postal receipt Ex.CW1/E. If crossexamination conducted upon this witness is perused in its entirety, it can be safely concluded that accused was unable to extract something contrary to what this witness stated in examination-in-chief, rather by putting certain suggestions in the cross-examination, accused himself admitted of his having availed loan to the tune of 3,50,000/- and his having issued₹ Cheque towards discharge of lawful liability. In his statement recorded under Section 313 Cr.P.C., petitioner though denied the case of the complainant in toto , but failed to lead any cogent and convincing evidence in defence to prove that in Cheque in question was not issued by him towards discharge of lawful liability.
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he received the legal notice Ex.CW1/D. Evidence led in defence itself suggests that accused had issued Cheque, which is subsequently claimed to have been misused by the complainant, however, in that regard, no cogent and convincing evidence ever came to be led on record. Interestingly, petitioner attempted to carve out a case that Cheque Ex.CW1/B was issued to Rakesh Kumar as a transaction for payment of vegetables, but at no point of time, he examined aforesaid Rakesh Kumar. He further failed to explain that how and in what circumstances, Cheque issued to Rakesh Kumar came in the possession of complainant.
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issued as a security, but since no evidence was adduced on record to probabilise aforesaid defence, both the Courts below rightly held accused guilty of his having committed the offence punishable under Section 138 of the Act, especially when Cheque in question issued by him was dishonoured on account of insufficient funds.
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“16. A cheque issued as security pursuant to a fnancial i 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 fulflment of an obligation to i 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 specifed timeframe and issues a i 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, 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 f l ow.”
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Court in case “State of Kerala Vs. Puttumana Illath Jathavedan Namboodiri” ( 1999) 2 Supreme Court Cases 452, wherein it has been held as under:-
“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
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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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(Sandeep Sharma), Judge
March 18, 2026 (Rajeev Raturi)
3 issues framed by the court
Whether the presumption under Sections 118 and 139 of the NI Act was properly invoked and whether the accused rebutted it regarding the lawful liability behind the dishonoured cheque.
Whether a cheque issued as security can ground a Section 138 offence when the underlying debt remains unpaid.
Whether the High Court in revisional jurisdiction should interfere with concurrent findings of conviction by the courts below.
Colour shows how this judgement treated each authority
M/s Laxmi Dyechem v. State of GujaratRelied on¶10
M/s Laxmi Dyechem V. State of Gujarat, 2013(1) RCR(Criminal)
Sripati Singh v. State of JharkhandRelied on¶15
Sripati Singh v. State of Jharkhand, Criminal Appeal No. 1269-1270 of 2021, decided on 28.10.2021
State of Kerala v. Puttumana Illath Jathavedan NamboodiriRelied on¶18
State of Kerala Vs. Puttumana Illath Jathavedan Namboodiri (1999) 2 Supreme Court Cases 452
Krishnan and another v. Krishnaveni and anotherExplained¶20
Krishnan and another Versus Krishnaveni and another, (1997) 4 Supreme Court Case 241
6 provisions across 3 enactments
Rangeen Kumar
Saurabh Mehra
Sandeep Sharma
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
