Rakesh Kumar vs Chattar Singh

Headnote AI-drafted · Reviewed and approved

The petitioner/accused was convicted by the learned Judicial Magistrate First Class, Nahan, under Section 138 of the Negotiable Instruments Act for dishonour of a cheque of ₹4,50,000/- drawn in favour of the respondent/complainant, which was returned with the endorsement 'funds insufficient'. The Trial Court sentenced the accused to simple imprisonment for one year and directed payment of compensation of ₹5,55,000/-, relying on the statutory presumptions under Sections 118(a) and 139 of the NI Act, which the accused failed to rebut by producing any evidence. The Sessions Judge, Sirmour at Nahan, dismissed the appeal filed by the accused, concurring with the findings of the Trial Court that the cheque was issued in discharge of a legal liability, the notice of demand was deemed served, and the sentence was not excessive.

In the present criminal revision, the petitioner/accused contended that the cheque was taken by the complainant as security and not in discharge of any legal liability, that the complainant admitted receiving a blank cheque, that the affidavit relied upon by the complainant was forged with extra lines added to it, and that the plea of the accused that he had borrowed only ₹1,00,000/- and repaid it was highly probable. The respondent/complainant contended that the accused had admitted his signatures on the cheque and had failed to rebut the statutory presumptions, and that the courts below had correctly appreciated the evidence.

The High Court, on revision, examined the concurrent findings of the courts below and the submissions of both sides. The revision was decided on 21.7.2025 after being reserved on 23.6.2025.

Catchwords: Negotiable Instruments Act · Section 138 · cheque dishonour · funds insufficient · presumption under Section 118(a) and 139 · security cheque · legal liability · burden of proof · notice of demand · criminal revision · sentence · compensation

Cheque dishonour (Section 138 NI Act)