Savitri Devi vs Himachal Pradesh Gramin Bank, Kharsi through its Branch Manager

Headnote AI-drafted · Reviewed and approved

The petitioner/accused filed a criminal revision against the judgment dated 25.2.2022 of the Sessions Judge, Bilaspur, which had partly upheld her conviction under Section 138 of the Negotiable Instruments Act and modified the sentence from one year's simple imprisonment to imprisonment till the rising of the Court, while maintaining compensation of ₹13,03,293/-. The original conviction was recorded by the Chief Judicial Magistrate, Bilaspur, in respect of a cheque for ₹11,84,811.08 issued by the accused towards discharge of a term loan of ₹21,15,000/- advanced by the complainant bank for purchase of a truck, which was dishonoured for insufficient funds.

The accused contended that the complainant had forcibly seized and sold the vehicle without crediting the proceeds to her account, that the loan was insured under the CGTMSE Scheme and amounts had been received by the complainant thereunder without disclosure in the complaint, that the cheque was taken in advance and filled without any existing liability, and that there were material alterations in the cheque. It was argued that no legally enforceable debt subsisted at the time of presentation of the cheque, rendering the conviction unsustainable.

Both courts below had held that the statutory presumption under the NI Act attached to the cheque remained unrebutted, that the accused admitted taking the loan, that the notice of demand was deemed served, and that the complainant had proved all ingredients of the offence. The revision raised questions regarding the effect of insurance claim receipts under the CGTMSE Scheme on the existence of a legally enforceable debt and the correctness of the compensation awarded.

Catchwords: Negotiable Instruments Act · Section 138 · dishonour of cheque · insufficient funds · legally enforceable debt · statutory presumption · CGTMSE Scheme · Credit Guarantee Fund Trust for Micro and Small Enterprises · term loan · vehicle loan · compensation · criminal revision · sentence modification

Cheque dishonour (Section 138 NI Act)