Delhi District Court
Sunil Sharma vs Shyam Karan Bhardwaz on 8 September, 2025
In The Court Of Ms. Kavita Bist: JMFC Mahila Court-01/PHC/NDD
Sunil Sharma Vs. Shyam Karan Bhardwaj
Cr Cases 327/2017
u/s 138 Negotiable Instruments Act, 1881
1. CIS number : 327/2017
2. Name of the Complainant : Sh. Sunil Sharma,
S/o Sh. Hari Shanker Sharma
R/o A-3, South Extension Part-II,
New Delhi-110048.
3. Name of the accused, : Sh. Shyam Karan Bhardwaj,
parentage & residential address S/o Sh. Jagvinder Singh
R/o Village Burari, Delhi.
4. Offence complained of or : u/s 138 Negotiable Instruments
proved Act, 1881
5. Plea of the accused : Pleaded not guilty and claimed
trial.
6. Final Judgement / order : Acquitted
7. Date of Judgement / order : 08.09.2025
Date of Institution : 24.11.2014
Date of Reserving Judgement / Order : 22.07.2025
Date of Pronouncement of Judgement/ Order : 08.09.2025
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JUDGEMENT
1.) By way of the present Judgement, this court shall dispose of the present complaint filed by Shri Sunil Sharma (herein after referred to as 'Complainant') against Shri Shyam Karan Bhardwaj (herein after referred to as 'accused') u/s 138 Negotiable Instruments Act, 1881 r/w section 142 Negotiable Instruments Act, 1881 (herein after referred to as "N.I. Act" in short).
Factual Matrix
2.) The brief facts as alleged by the Complainant in the complaint are that the complainant and accused were having friendly relations for last so many years and the accused knew about the fact that the complainant has recently sold his flat and he can provide financial assistance to him and accused had approached and requested the complainant to provide financial assistance of Rs. 50 lakh to him for his personal use and accused undertook to repay the same within six months and on 28.08.2012, the complainant paid a sum of Rs. 50 lakh in cash as a friendly loan to the accused and accused had issued two separate receipt of Rs. 25 lakh each on a stamp paper of Rs. 10/-. Thereafter, after passing of six months, the complainant approached the accused to repay the loan and that on 31.10.2013, after great persuassion of the complainant and in order to repay the loan amount and discharge of his legal liability, accused had issued two cheques bearing no. 887209 and 887207 dated 01.11.2013 and 15.12.2013 each amounting to Rs. 25 lakh both drawn on HDFC Bank Limited A-4, Panchvati Adarsh Nagar Delhi-110033 in favour of complainant along with one another Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 2/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:07:42 +0530 cheque bearing no. 887225 dated 18.11.2013 amounting to Rs. 5 lakh drawn on HDFC Bank Limited, A-4, Panchvati Adarsh Nagar Delhi-110033 in favour of wife of the complainant towards the compensation for delay in repayment.
When the Complainant presented the said two cheques, (herein after referred to as 'cheques in question') through his banker UCO Bank Supreme Court Complex, Delhi branch along with third cheque which was presented by his wife with her banker UCO Bank, Supreme Court Complex, New Delhi, the same were returned unpaid by the banker of the accused vide returning memos dated 21.12.2013, 26.12.2013 and 26.12.2013 with the remarks "Account Closed".
The Complainant thereafter issued a legal demand notice on 24.01.2014 through Counsel calling upon the accused to pay the said cheques amount within a period of 15 days from receipt thereof. The said notice was duly served upon the accused and the accused failed to pay the aforesaid cheques amount within the statutory period.
Hence, the present complaint u/s 138 N.I.Act was filed on 24.11.2014 by the complainant, praying for the accused to be summoned, tried and punished for commission of the offence u/s 138 N.I.Act. The Complainant has averred that the present complaint is within the period of limitation and falls within the territorial limit of this Court's jurisdiction;
thus, being tenable at law.
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Proceedings before the Court
3.) Pre-summoning evidence of the complainant: To prove prima-
facie case, the complainant led pre-summoning evidence by way of affidavit, exhibit CW1/A.
4.) Documentary Evidence of the complainant: To prove his prima-facie case, the complainant has relied upon the following documents:
a.) Certified copy of receipts dated 28.08.2012 exhibited as Ex. CW1/1 and Ex. CW1/2.
b.) Certified copy of cheques bearing no. 887209, 887207 and 887225 exhibited as Ex.CW1/3, Ex. CW1/4 and Ex. CW1/5.
c.) Certified copy of returning memos dated 21.12.2013, 26.12.2013 and 26.12.2013 exhibited as Ex. CW1/6, Ex. CW1/7 and Ex.
CW1/8.
d.) Legal demand notice dated 24.01.2014 exhibited as Ex. CW1/9.
e.) Speed postal receipts exhibited as Ex. CW1/10 and Ex. CW1/11.
f.) Tracking reports for the legal demand notice exhibited as Ex. CW1/12 and Ex. CW1/13.
5. In his pre-summoning evidence, the complainant has also examined CW-2 Sh. Paramjeet Kaushik, the then, Ahlmad in the Court of Ms. Rashmi Gupta, the then, Ld. MM-09/Central Tis Hazari Court, Delhi Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 4/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:07:51 +0530 for bringing the summoned record of FIR no. 66/2014 P.S Burari and the certified copy of the same was exhibited as Ex. CW2/1 (colly-45 pages) (OSR).
6.) After perusing the complaint and hearing the argument of the Complainant on the point of summoning of the accused, prima-facie it appeared that the offence u/s 138 N.I.Act has been committed. Hence, cognizance of the offence u/s 138 N.I.Act was taken on 21.01.2017.
7.) Framing of notice and plea of defence: Notice u/s 251 Cr.P.C was framed against the accused on 04.12.2019 to which he pleaded not guilty and claimed trial. The plea of defence of the accused was recorded where he admitted his signature on the cheques in question and stated that the cheques in question were given as blank signed cheques. He further stated that the complainant is his friend for the last 18-20 years and complainant told him that he is willing to purchase a flat and he needs finance for the said flat and requested him to give three cheques and two stamp papers to show the same to the owner of the flat and told him that he will return the same after the owner is satisfied. He further stated that the complainant had also taken a loan of Rs.57,00,000/- from him out of which he only returned Rs. 7 lakhs. He further stated that his case for recovery is pending and the complainant did not return his cheques and misused them. He further stated that he did not receive the legal notice issued by the complainant.
8.) Evidence of the complainant: After framing of notice, application u/s 145(2) N.I. Act was allowed by the Ld. Predecessor and Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 5/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:07:56 +0530 hence, the case was tried as a summons case and accused was granted permission to cross examine the complainant. Thereafter, the complainant was cross-examined by the accused and discharged. No other witnesses were examined by the complainant. Thereafter, complainant evidence was closed, and the matter was put up for statement of accused u/s 313 Cr.P.C r/w Section 281 Cr.P.C.
9.) Statement of the accused: Statement of the accused was recorded u/s 313 Cr.P.C r/w Sections 281 Cr.P.C on 27.03.2025, wherein all the incriminating circumstances appearing in evidence against the accused were put to him to which, he stated that it is correct that the complainant was his friend since the year 1996-1997. He further stated that in the year 2011-2012, the complainant approached him for the purpose of purchasing a flat as he wanted to shift from earlier place due to some legal cases and after few days, he again approached him and told him that he has selected one property in South Extension and complainant asked him for three blank signed cheques along with two blank signed stamp papers for the purpose of showing the same to the proposed seller of the property and after that he had given him three blank signed cheques (Ex. CW1/3, Ex. CW1/4 and Ex. CW1/5) along with two blank signed stamp papers (Ex. CW1/1 and Ex. CW1/2) and complainant assured him that he would return the same after showing the same to the proposed seller and thereafter, after some time, he asked the complainant to return the above-said cheques along with the stamp papers, however, the same were not returned to him on the pretext that the same have been misplaced. Thereafter, the Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 6/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:08:01 +0530 complainant had filed false case against him. He also stated that he does not remember whether he had received any legal demand notice issued by the complainant or not. He also stated that he wants to lead defence evidence and the present case is a false and fabricated case.
10.) Defence evidence: The accused examined himself as DW1 in the present case and no other witnesses were examined by the accused. Thereafter, defence evidence was closed, and the matter was put up for final arguments.
11.) Final Arguments: Final arguements were advanced by both sides. I have heard the submission of Ld. Counsel for the complainant as well as the accused. I have also perused the record and written arguments filed by the complainant.
12.) Before deciding the present complaint case u/s 138 of N.I Act, 1881, the following legal requirements must be satisfied from the averments in the complaint as well as the evidence of complainant.
a.) That a person has drawn a cheque, on an account maintained by him with the banker for payment of any amount of money in other person from out of that account for the discharge, in whole or in part, of any legally enforceable debt or other liability;
b.) That the cheque has been presented to the bank with in a period of three months from the date on which it is drawn or within the period of its validity, whichever is earlier;
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c.) That the cheque has been returned by the drawee bank unpaid,
for the reason that the amount of money standing to be credit of that account is insufficient to honor the cheque or that it exceeds the amount arranged to be paid from that account by agreement made with that bank;
d.) That the payee or holder in due course has made a demand for payment of the said amount of money by giving the notice in writing to the drawer of the cheque within 30 days of receipt of information from the bank regarding the return of the cheque as unpaid;
e.) That the drawer of the cheque fails to make the payment of the said amount of money to the payee or holder in due course within 15 days of the receipt of the said notice;
The aforesaid legal requirements are cumulative in nature, i.e only when all of the aforementioned ingredients are duly proved is the drawer of the cheque deemed to have committed an offence u/s 138 of N.I Act.
The provision of section 138 N.I is buttressed by section 139 and section 118(a) of the N.I. Act. Section 139 of the Act provides that the court shall presume, that the holder of a cheque received the cheque for the discharge, wholly or in part of any debt or other liability. Section 118(a) of the Act provides interalia that the court shall presume, until the contrary is proved, that every Negotiable Instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, endorsed, negotiated or transferred, was accepted, endorsed, negotiated or transferred for consideration.
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13.) It is a well settled principle of criminal jurisprudence that a
criminal trial proceeds on the presumption of innocence of the accused i.e an accused is presumed to be innocent unless proved guilty. Thus, normally the initial burden to prove is on the complainant/prosecution to prove the guilt of the accused. Also, the standard of prove is beyond reasonable doubt. However, in offences u/s 138 of the N.I Act, there is a reverse onus clause contained in section 118(a) and section 139 of the N.I Act. The presumption u/s 139 and section 118(a) of the N.I Act mandate the court to draw them, when a given set of facts are shown to exist. The same is evident by the peremptory language "Shall presume" used. However, the said presumptions are rebuttable in nature, i.e it is open for the defence to disprove the same by establishing facts to the contrary.
In the case of Hiten P. Dayal Vs. Bratindranath Bannerjee (2001) 6 SCC 16, the Hon'ble Supreme Court had occasion to examine the confines of the presumptions u/s 139 of the Act wherein, it held as follows:
"because both section 138 and 139 require that the court "shall presume" the liability of the drawer of the cheques for the amounts for which the cheques are drawn, as noted in State of Madras Vs. A. Vaidyanatha Iyer AIR 1958 SC 61, it is obligatory on the court to raise this presumption in every case where the factual basis for the raising of the presumption had been established. It introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused. The obligation on the prosecution may be discharged with the help of presumptions of law or facts Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 9/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:08:15 +0530 unless the accused adduces the evidence showing the reasonable possibility of the non existence of the presumed fact. Therefore, the rebuttal does not have to be conclusive establish but such evidence must be adduced before the court in support of the defence that court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of 'prudent man'"
14.) It is a settled proposition of law that the standard of proof which is required from the accused to rebut the statutory presumption u/s 118(a) r/w section 139 of the N.I Act is preponderance of probabilities. The accused is not required to prove his case beyond reasonable doubt. This onus on the accused can be discharged from the materials available on record and from the circumstantial evidences. At this point, the Hon'ble Supreme Court in M.S Narayan Menon Vs. State of Kerala (2006) 6 SCC 39 has interalia held the following:
"The standard of proof evidently is preponderance of probabilities. Inference of preponderance of probabilities can be drawn not only from materials on record but also by reference to the circumstances upon which he relies."
15.) It is not always mandatory for the accused to examine its own witness in order to rebut the said statutory presumption. At this point, reliance may be placed on the decision of the Hon'ble Supreme Court in the case of Krishna Janardhan Bhat Vs. Dattatraya G. Hegde AIR Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 10/35 Digitally signed by KAVITA BIST KAVITA Date:
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2008 SC 1325, wherein the Hon'ble Court has categorically held the following:
"Accused for discharging the burden of proof placed upon him under a statute need not examine himself. He may discharge his burden on the basis of the materials already brought on record. As accused has a constitutional right to remain silent. Standard of proof on the part of an accused and that of the prosecution in a criminal case is different."
16.) With regard to the factors taken into account for rebutting the presumption u/s 139 r/w Section 118(a) of the Act, the Judgment of Hon'ble Delhi High Court in V.S Yadav Vs. Reena, 172 (2010) DLT 561, assumes importance, wherein, it was held that:
"Mere pleading not guilty and stating that the cheques were issued as security, would not amount to rebutting the presumption raised u/s 139 of N.I Act. The accused, by cogent evidence, has to prove the circumstance under which cheques were issued."
17.) Now, I shall proceed with the legal ingredients one by one and give my finding on whether the evidence on record satisfies the legal ingredients in question or not:-
a.) "That a person has drawn a cheque, on an account maintained by him with the banker for payment of any amount of money in other person from out of that account for the discharge, in whole or in part, of any legally enforceable debt or other liability."
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17.1) This condition pertains to the issuance of the cheque itself. It
is pertinent to note that the accused in his notice of accusation u/s 251 Cr.P.C has admitted his signature on the cheques in question. Further, the cheques have been drawn on the account of accused. This leads to drawing of an inference u/s 139 r/w section 118 of the Act, that the cheques were issued in discharge of a legally recoverable debt or other liability.
17.2) The presumption, having been raised against the accused, it falls upon him to rebut it. The accused has taken a defence that it is correct that the complainant was his friend since the year 1996-1997. He further stated that in the year 2011-2012, the complainant approached him for the purpose of purchasing a flat as he wanted to shift from earlier place due to some legal cases and after few days, he again approached him and told him that he has selected one property in South Extension and complainant asked him for three blank signed cheques along with two blank signed stamp papers for the purpose of showing the same to the proposed seller of the property and after that he had given him three blank signed cheques (Ex.
CW1/3, Ex. CW1/4 and Ex. CW1/5) along with two blank signed stamp papers (Ex. CW1/1 and Ex. CW1/2) and complainant assured him that he would return the same after showing the same to the proposed seller and thereafter, after some time, he asked the complainant to return the above- said cheques along with the stamp papers, however, the same were not returned to him on the pretext that the same have been misplaced. Thereafter, the complainant had filed false case against him. He also stated that he did not receive any legal demand notice issued by the complainant.
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The accused has cross-examined CW1 and examined himself as DW1 in his defence.
17.3) The standard of proof for rebuttal is on preponderance of probabilities. As held by the Hon'ble Supreme Court in decision as K.N Beena Vs. Muniyappan and Anr. (2001) 8 SCC 458, in order to rebut the presumption, mere denial by the accused will not suffice. The accused must prove by leading cogent evidence that there was no debt or liability.
17.4) In case of M/s Kumar Exports Cas Vs. M/s Sharma Carpets Crl. A.No. 2045/2008, the Hon'ble Supreme Court has held:
"The accused u/s 138 N.I Act has two options. He can either show that the consideration and debt did not exist or that under the particular circumstances of the case, the non existence of consideration and debt is so probable that the prudent man ought to suppose that no consideration and debt existed. To rebut the statutory presumption, an accused is not expected to prove his defence beyond reasonble doubt as it is expected of the complainant in a criminal trial. The accused may adduced direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharge by him. However, the court need not insist in every case that the accused should disprove the non existence of consideration and debt by leaving direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that bare denial of the passing of the consideration an existence of debt, apparenlty would not serve the purpose of the accused. The accused may also rely upon presumptions of fact, Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 13/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:08:35 +0530 for instance, those mentioned in section 114 of the Evidence Act to rebut the presumptions arises u/s 118 and 139 of N.I Act."
17.5) Major defence led by the Ld. Counsel for accused is that it is correct that the complainant was the friend of accused since the year 1996- 1997. He further stated that in the year 2011-2012, the complainant approached the accused for the purpose of purchasing a flat as complainant wanted to shift from earlier place due to some legal cases and after few days, the complainant again approached the accused and told the accused that he has selected one property in South Extension and complainant asked the accused for three blank signed cheques along with two blank signed stamp papers for the purpose of showing the same to the proposed seller of the property and after that accused had given the complainant three blank signed cheques (Ex. CW1/3, Ex. CW1/4 and Ex. CW1/5) along with two blank signed stamp papers (Ex. CW1/1 and Ex. CW1/2) and complainant assured the accused that he would return the same after showing the same to the proposed seller and thereafter, after some time, accused had asked the complainant to return the above-said cheques along with stamp papers, however, the same were not returned to the accused on the pretext that the same have been misplaced. Thereafter, the complainant had filed the false case against the accused. He further stated that the accused has not received any legal demand notice issued by the complainant. In the present case, the onus to prove that accused has not issued the cheque in question for any legally enfroceable debt or liability in favour of the complainant primarily lied on the accused. Section 103 of Indian Evidence Act, 1872, enunciates Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 14/35 Digitally signed by KAVITA BIST KAVITA Date:
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that the person who asserts a fact must prove the same unless the law otherwise provides.
In order to create doubts in the complainant's claim, the accused has adopted the abovesaid defences and I shall deal with all the defences separately.
The body of cheques in question has not been filled by the accused:-
The accused has stated in his notice of accusation that the cheques in question were given as blank signed cheques to the complainant, hence, there is a material alteration in the cheques in question. So far as the defence of filling of details by the complainant in the cheques are concerned, the same is untenable, considering the case of "Bir Singh Vs. Mukesh Kumar, 2019 (4) SCC 197 wherein the Hon'ble Supreme Court" observed and held:
"A meaningful reading of the provision of the Negotiable Instruments Act including, in particular, section 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. It is cheque is otherwise valid, the penal provisions of section 138 would be attracted. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 15/35 Digitally signed by KAVITA BIST KAVITA Date:
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cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence."
It is also pertinent to refer Oriental Bank of Commerce Vs. Prabodh Kumar Tewari Crl. A.No. 1260/2022, wherein the Hon'ble Supreme Court held:
"For such a determination, the fact that the details of the cheque have been filled up not by the drawer, but by some other person would be immaterial. The presumption which arises of the signing of the cheque can not be rebutted merely by the report of a handwriting expert. Even if the details in the cheque have not been filled by drawer but by another person, this is not relevant to the defence whether cheque was issued towards payment of a debt or in discharge of a liability."
In this context, it is necessary to take note of the judgment of Hon'ble Delhi High Court in Ravi Chopra Vs. State and Anr. (2008) 102 DRJ 147, wherein the Hon'ble Court held:
" A collective reading of the abovesaid provision shows that even under the scheme of the N.I. Act it is possible for the drawer of a cheque to give a blank cheque signed by him to the payee and consent either impliedly or expressly to the said cheque being filled up as a subsequent point in time and presented for payment by the drawee. There is no provision in the N.I. Act which either defines the difference in hand writing or the ink pertaining to the material particulars filled up in comparison with the signatures thereon as constituting a 'material alteration' for the Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 16/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:08:52 +0530 purposes of section 87 N.I. Act. What however, is essential is that the cheque must have been signed by the drawer. If the signature is altered or does not tally with the normal signature of the maker, that would be a material alteration. Therefore, as long as the cheque has been signed by the drawer, the fact that the ink in which the name and figures are written or the date is filled up is different from the ink of the signature is not a material alteration for the purposes of section 87 N.I. Act."
Therefore, the plea that the details of the cheques in question were not filled by the accused is untenable in light of the above-mentioned judgments.
Blank signed documents taken by the complainant The accused has taken a defence which deserves the scrutiny of this court is that he had handed over two blank signed stamp papers to the complainant.
As far as the above-said defence is concerned, it is important to draw attention on the notice of accusation u/s 251 Cr.P.C and statement recorded u/s 313 r/w section 281 Cr.P.C of accused, wherein the accused has stated that the complainant was his friend and he was willing to purchase a flat and requested him to give three blank signed cheques along with two blank signed stamp papers for the purpose of showing the same to the proposed seller of the property and has also assured him that the same would be returned after showing the same to the proposed seller, however, the same were not returned to him on the pretext that they have been misplaced by him.
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The complainant has filed two undertakings/acknowledgments on stamp papers Ex. CW1/1 and Ex. CW1/2 duly signed by the accused on 28.08.2012, wherein, he has stated that he had lent a sum of Rs. 25 lakh each to the accused after selling one of his property situated in Dwarka for a total consideration of Rs. 50 lakh. Now, it is important to note here that the accused has duly admitted his signatures on the said documents during his cross-examination, however, he has simply averred that two blank signed stamp papers were taken by the complainant and he has also stated that at that time, no one was present there except him and the complainant. The accused has neither examined any witness nor filed any documentary proof which can substantiate the above-said claim of the accused.
In the absence of any cogent evidence regarding the above- said claim the defence taken by the accused that he had given two blank signed stamp papers to the complainant, is a bare averment, unsubstantiated by any proof and the said undertaking stands duly proved by the complainant.
Unsurety about the handing over of cheques in question:-
One of the defence taken by the accused which deserves scrutiny of this court is that the complainant himself is not sure as to when the cheques in question were handed over to him by the accused.
In this regard, firstly, it is important to draw attention on the complaint and evidence affidavit filed by the complainant wherein the complainant has stated that on 28.08.2012, he paid a sum of Rs. 50 lakh in cash to the accused as a friendly loan and the accused had issued two Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 18/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:09:09 +0530 separate receipt of Rs. 25 lakh each on stamp papers and that on 31.10.2013 when he approached the accused and requested him for repayment of the said loan, the accused issued the cheques in question along with one other cheque with assurance that the same would be honoured on their presentation, however, during his cross-examination, he has stated that the cheques in question were given on 28.08.2012 only but during the same cross-examination, he has again stated that the cheque in question Ex. CW1/3 and Ex. CW1/4 were issued to him on 01.11.2013 and 15.12.2013 respectively.
On one hand, the accused has stated that the cheques in question were given on the date of alleged loan only, however, on the other hand, he has stated that cheques in question were given on 31.10.2013 and then, it was stated that the cheques in question were given on 01.11.2013 and 15.12.2013 which shows that the complainant himself is not sure as to when the cheques in question were handed over to him by the accused which raises doubt on the version set up by the complainant.
Unsurety about the purpose of alleged loan:-
One of the defence taken by the accused which deserves the attention of this court is that the date and purpose of loan as alleged in the present complaint is different from the evidence recorded in other connected matter and as such, cast clouds on the version of the complainant.
In this regard, it is important to draw attention on the evidence affidavit of the complainant, wherein he has stated that the alleged loan of Rs. 50 lakh was given to the accused as friendly loan and he has also stated Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 19/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:09:20 +0530 during his cross-examination that the said loan was given to the accused to help him as a friend as he was in financial hardship.
Ld. Counsel for the accused has confronted the evidence of complainant Mark DW1/3 recorded in Case No. 291283/2016, FIR no. 66/2014, P.S Burari, titled as State Vs. Shyam Karan Bhardwaj before the Ld. M.M.-09, Central THC which is not disputed by the complainant, wherein, the complainant has stated that he has given an amount of Rs. 50 lakh to the accused in the begining of 2013 and he has also stated that the said amount was not loan and he was told by the accused that he would invest the same in property.
In this regard, firstly, it is important to draw attention on the judgment of Mitthulal And Anr. vs The State Of Madhya Pradesh on 11 November, 1974, wherein, AIR1975SC149, wherein the Hon'ble Supreme Court of India has observed as under:-
4.................... This was clearly impermissible to the High Court. It is difficulty to comprehend as to how the High Court could decide the appeal before it by taking into accounts evidence recorded in another case, even though it might be what is loosely called a cross case. It is elementary that each case must be decided on the evidence recorded in it and evidence recorded in another case cannot be taken into account in arriving at the decision Even in civil cases this cannot be done unless the parties are agreed that the evidence in one case may be treated as evidence in the other.............Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 20/35
Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:09:27 +0530 In view of the above-said judgment, the evidence recorded in other case though related to the cheques in question of the present matter can not be considered in the present matter and as such, the defence taken by the accused that there is inconsistency regarding the date and purpose of alleged loan is of no force.
Legal notice is defective One of the defence taken by the accused in the present matter is that the legal demand notice Ex. CW1/9 served by the complainant to the accused is defective on two grounds firstly, the said notice is for three cheques and the present matter is for only two cheques, and secondly, omnibus notice has been served to him as the legal notice for one of the cheque claimed in the present matter was sent to the accused after the expiry of 30 days from the date of returning memo.
In this regard, it is important to draw attention on the legal demand notice Ex. CW1/9, wherein, it has been stated that the accused has issued three PDCs Ex. CW1/3, Ex. CW1/4 and Ex. CW1/5 with specific cheques number, date, amount and bank's name.
The complainant has claimed only Ex. CW1/3 and Ex. CW1/4 in the present matter as the Ex. CW1/5 was drawn in favour of his wife namely Poonam Sharma. The returning memos Ex. CW1/6 and Ex. CW1/7 bears the date of 21.12.2013 and 26.12.2013 and the legal demand notice was sent to the accused on 24.01.2014 as per the speed postal receipts Ex. CW1/10 and Ex. CW1/11 and as such, for Ex. CW1/3, the legal demand Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 21/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:09:34 +0530 notice was sent to the accused after the stipulated period of 30 days from the date of returning memo as mentioned in Section 138 of N.I. Act.
Before deciding the said defence of accused, it is important to place reliance on the judgment of M/s Rahul Builders Vs. M/s Arihant Fertlizers and Chemicals 2007 AIR SCW 7008, wherein the Hon'ble Supreme Court of India has observed as under:-
"10. Service of a notice, it is trite, is imperative in character for maintaining a complaint. It creates a legal fiction. Operation of Section 138 of the Act is limited by the proviso. When the proviso applies, the main Section would not. Unless a notice is served in conformity with Proviso (b) appended to Section 138 of the Act, the complaint petition would not be maintainable. The Parliament while enacting the said provision consciously imposed certain conditions. One of the conditions was service of a notice making demand of the payment of the amount of cheque as is evident from the use of the phraseology "payment of the said amount of money". Such a notice has to be issued within a period of 30 days from the date of receipt of information from the bank in regard to the return of the cheque as unpaid. The statute envisages application of the penal provisions. A penal provision should be construed strictly; the condition precedent wherefor is service of notice. It is one thing to say that the demand may not only represent the unpaid amount under cheque but also other incidental expenses like costs and interests, but the same would not mean that the notice would be vague and capable of two interpretations. An omnibus notice without specifying as to what was the amount due under the dishonoured cheque Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 22/35 Digitally signed by KAVITA BIST KAVITA Date:
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would not subserve the requirement of law."
In this regard, it is important to draw attention on the legal demand notice, wherein, a demand of Rs. 50 lakh and Rs. 5 lakh is raised by the complainant, however, the cheques number and the cheques amount are clearly mentioned in the said notice and only because the legal demand notice for one of the cheque in question was not sent within the stipulated period as mentioned in Section 138 of N.I. Act, the whole legal demand notice can not be considered defective as far as the other cheque in question is concerned for which, it was sent within the stipulated time and as such, the said notice can not be treated as an omnibus notice considering the severable nature of the same and remain valid for Ex. CW1/4.
No loan was ever taken by the complainant The main defence taken by the accused which deserves close scrutiny of this court is that no loan was ever given by the complainant to him and the cheques in question along with one other cheque were given to the complainant as he wanted to purchase a property and asked him to give blank signed cheques to show the same to the proposed seller, however, the said cheques were not returned to him on the pretext that the same have been misplaced and misused by the complainant in the present matter and as such, the accused has questioned the financial capacity of the complainant to lend such a huge amount. In this regard, it is appropriate to refer judgment of APS Forex Services Private Limited Vs. Shakti International Fashion Linkers AIR 2020 SC 945, wherein the Hon'ble Apex Court had explained as follows:
Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 23/35Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:09:44 +0530 "Now so far as the reliance is placed by Learned Counsel appearing on behalf of the accused on the decision of this Court in the case of Basalingappa (supra), on going through the said decision, we are of the opinion that the said decision shall not be applicable to the facts of the case on hand and/or the same shall not be of any assistance to the accused. In that case before this Court, the defence by the accused was that the cheque amount was given by the complainant to the accused by way of loan. When the proceedings were initiated under Section 138 of the N.I. Act the accused denied the debt liability and the accused raised the defence and questioned the financial capacity of the complainant. To that, the complainant failed to prove and establish his financial capacity. Therefore, this Court was satisfied that the accused had a probable defence and consequently in absence of complainant having failed to prove his financial capacity, this Court acquitted the accused. In the present case, the accused never questioned the financial capacity of the complainant. We are of the view that whenever the accused has questioned the financial capacity of the complainant in support of his probable defence, despite the presumption under Section 139 of the N.I. Act about the presumption of legally enforceable debt and such presumption is rebuttable, thereafter the onus shifts again on the complainant to prove his financial capacity and at that stage the complainant is required to lead the evidence to prove his financial capacity, more particularly when it is a case of giving loan by cash and thereafter issuance of a cheque."
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The position emerges from the above-said judgment is that initially the complainant has not any obligation, in all cases u/s 138 N.I. Act, to prove his financial capacity, however, when the case of the complainant is that he lent money to the accused by cash and that the accused issued the cheque in discharge of the liability, and if the accused is challenging the financial capacity of the complainant then despite the presumption u/s 139 of N.I Act, the complainant has the obligation to prove his financial capacity. In the present case, the accused had challenged the financial capacity of the complainant to lent an amount of Rs. 50 lakh.
During the cross-examination of the complainant, he deposed that he is journalist by profession and the accused was known to him since 2003 -2004 as the accused was a property dealer and he was also a Neta Ji in some political party. He consulted the accused for the sale of one of his flat and the said flat was in the name of his wife namely Poonam Sharma and he further stated that the said flat was in Dwarka, however, he failed to provide the proper address of the said flat and he has also stated that the said flat was sold to one person namely Jagdish Sharma for a sum of Rs. 94 lakh in the year 2012 and he received a sum of Rs. 50 lakh in cash immediately and the rest was also received in cash but later. He further stated that the said amount of Rs. 50 lakh was given to the accused on 28.08.2012 in cash at his old residence.
He has admitted that he has not disclosed the sale of the said flat in his ITR, however, he has admitted that he is regular income tax payee and he has further stated that neither he nor his wife has filed the ITR in the year 2012-2013 when the said flat was sold and he has also stated Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 25/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:09:55 +0530 that before the year 2012, he had not the sum of Rs. 50 lakh in his bank account.
During his cross-examination when he was asked by the Ld. Counsel for the accused that whether any document was executed regarding the receiving of Rs. 50 lakh when the flat was sold, he answered in affirmative but when he was asked to produce the same before the court, he has stated that he can not do so as he does not remember where he has kept the same.
He was also asked whether any will was made by her wife regarding the said flat, he again answered in affirmative and the said will Mark DW1/2 was placed on record, wherein, the wife of the complainant has bequeathed the said flat to one person namely Jagdish Sharma on 21.06.2013 and the complainant has not disputed the said will and as such, the same can be relied upon.
On one hand, the complainant has stated that the alleged loan of Rs. 50 lakh was given to the accused after selling a flat of his wife for an amount of Rs. 94 lakh, however, on the other hand, he has not disputed the Will mark DW1/2 which was executed by his wife after the alleged date of loan and as such, failed to convince this court how the said property can be bequeathed by his wife when the said property was already sold by his wife as alleged by the complainant and the alleged loan was given from the part consideration of the said property.
Moreover, the complainant has miserably failed to prove the source of alleged loan as he has failed to produce the ITR of his wife Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 26/35 Digitally signed by KAVITA BIST KAVITA Date:
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reflecting the said sale and document executed at the time of receiving Rs. 50 lakh from the proposed buyer and he has also failed to examine the said buyer namely Jagdish Sharma to prove his claim.
It is also pertinent to mention here that on undertaking Ex. CW1/1 and Ex. CW1/2 relied by the complainant, it has been mentioned that property of Dwarka was sold for an amount of Rs. 50 lakh, however, during the testimony of complainant, he has stated that the said property was sold for an amount of Rs. 94 lakh, which again raises doubt on the story of the complainant.
In view of the above-said findings and considering the failure of complainant to dispute the Will Mark DW1/2; failure of complainant to file his or his wife's ITR for the relevant period reflecting the said sale; failure of complainant to produce the document executed between his wife and alleged buyer acknowledging the receipt of Rs. 50 lakh; inconsistency regarding the consideration of sale amount of property and failure to examine the buyer of the said property; the court is of considered view that the complainant has failed to prove his financial capacity to lend the alleged loan which was given in cash to the accused and as such, the accused successfully raised doubt as far as alleged liablity is concerned and rebutted the presumption which is in favour of the complainant.
17.6) At this stage, it should be noted that when the accused successfully creats doubts in the complainant's case by drawing inferences from the materials on record and also from the circumstances, statutory presumptions u/s 118(a) r/w Section 139 of the N.I stand rebutted and Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 27/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:10:03 +0530 burden to proof is then shifted to the complainant to prove the guilt of accused beyond reasonable doubt. Reference can be taken from the decision of the Hon'ble Supreme Court from the case of Bharat Barrel & Drum Manufacturing Company Vs. Amin Chand Pyare Lal 1999 (3) SCC 35, wherein it has held the following:
"Upon consideration of various judgments as noted herein above, the position of law which emerges is that once execution of the promissory note is admitted, the presumption u/s 118A would arise that it is supported by a consideration. Such a presumption is rebuttable. The defendant can prove the non existence of a consideration by raising a probable defence. If the defendant is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the plaintiff who will be obliged to prove it as a matter of fact as upon its failure to prove would dis entitle him to the grant of relief on the basis of the negotiable instrumens"
17.7) In the instant case, as discussed above, the burden of proof shifted to the complainant to prove the existence of a legally enforceable debt when the accused succuessfully rebutted the statutory presumption u/S 118(a) r/w section 139 of N.I Act. Therefore, it is for the complainant to prove the guilt of the accused beyond reasonable doubt by leading cogent evidences on record. However, the complainant has neither examined any witnesses nor filed any documents on record to prove the existence of legally enforceable debt.
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17.8) Therefore, in view of the above discussions, I am of the view
that the accused has successfully raised doubt regarding the liability, after considering the failure of complainant to dispute the will Mark DW1/2; failure of complainant to file his or his wife's ITR for the relevant period reflecting the said sale; failure of complainant to produce the document executed between his wife and buyer acknowledging the receipt of Rs. 50 lakh; inconsistency regarding the sale amount of property and failure to examine the buyer of the said property. In this light, this court is of the considered opinion that the accused has successfully demolished the case of complainant regarding the existence of legally enforceable debt.
The upshot of the above discussion is that the said ingredient remains unfulfilled as against the accused. Hence, considering the materials available on record, I am of the considered view that the accused has successfully rebutted the presumption of legally enforceable debt or liability in favour of the complainant.
b.) "That the cheque has been presented to the bank with in a period of three months from the date on which it is drawn or within the period of its validity, whichever is earlier;"
17.9) This requirement is satisfied on a perusal of the cheques in question Ex. CW1/3 and Ex. CW1/4 dated 01.11.2013 and 15.12.2013 and the returnings memos Ex. CW1/6 and Ex. CW1/7 which bears the date of 21.12.2013 and 26.12.2013 i.e within a period of three months from the date of issuance of cheques in question. The defence has led no evidence to Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 29/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:10:12 +0530 controvert the same and hence, the ingredient stands fulfilled as against the accused person.
c.) "That the cheque has been returned by the drawee bank unpaid, for the reason that the amount of money standing to be credit of that account is insufficient to honor the cheque or that it exceeds the amount arranged to be paid from that account by agreement made with that bank."
17.10) Section 146 of N.I Act, 1881 provides that the court shall, on production of bank's slip or memo having therein the official mark denoting that the cheque has been dishonored, presumed the fact of dishonor of such cheque, unless and until such fact is disproved. The bank returnings memos Ex. CW1/6 and Ex. CW1/7 are on record states that the cheques in question have been returned dishonored for the reason "Account closed." In this regard, it is important to draw attention on judgment of NEPC Micon Ltd. Vs. Magma Leasing Ltd. (1999) 4 SCC 253, wherein the Hon'ble Supreme Court has observed as under:
"Hence, the question is, in a case where cheque is returned by the bank unpaid on the ground that the account is closed, would it mean that cheque is returned as unpaid on the ground that the amount of money standing to the credit of that account is insufficient to honour the cheque. In our view, the answer would obviously be in the affirmative because cheque is dishonoured as the amount of money standing to the credit of that account was nil at the relevant time apart from it being closed. Closure of the account would be an eventuality after the entire amount in the account Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 30/35 Digitally signed by KAVITA BIST KAVITA Date:
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is withdrawn. It means that there was no amount in the credit of that account on the relevant date when the cheque was presented for honouring the same. The expression the amount of money standing to the credit of that account is insufficient to honour the cheque is a genus of which the expression that account being closed is specie. After issuing the cheque drawn on an account maintained, a person, if he closes that account apart from the fact that it may amount to another offence, it would certainly be an offence under Section 138 as there was insufficient or no fund to honour the cheque in that account; Hence, when the cheque is returned by a bank with an endorsement account closed, it would amount to returning the cheque unpaid because the amount of money standing to the credit of that account is insufficient to honour the cheque as envisaged in Section 138 of the Act."
Considering the abovesaid judgment and also considering that the defence has led no evidence to controvert the same, hence, this ingredient is also fulfilled as against the accused.
d.) "That the payee or holder in due course has made a demand for payment of the said amount of money by giving the notice in writing to the drawer of the cheque within 30 days of receipt of information from the bank regarding the return of the cheque as unpaid"
17.11) As it has already been discussed above that the legal demand notice qua one of the cheque in question Ex. CW1/3 was sent after the expiration of 30 days from the date of receipt of information from the bank regarding the cheque as unpaid and as such, it can not be considered a valid Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 31/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:10:24 +0530 legal notice qua the cheque Ex. CW1/3, however, as regard the service of legal demand notice qua the cheque Ex. CW1/4, the complainant has sent the same Ex. CW1/9 to the accused. The original postal receipt Ex. CW1/10 in respect of the same is already on record. The tracking report Ex. CW1/12 is also on record and the same is showing "Item delivered".
However, the accused has stated in his notice u/S 251 Cr.P.C that he did not received the legal demand notice, but he has not disputed the address mentioned in the legal demand notice at any stage of trial.
17.12) Before examining the issue in hand, it would be prudent to run through the legal position on the due service of notice sent by post. Presumption regarding successful delivery of documents sent by post can be raised by the court as per provision enshrined in section 27 of Genral Clauses Act r/w Section 114 of Indian Evidence Act 1872. In terms of section 27 of General Clauses Act , notice must be deemed to have been served in the ordinary course subject to the fulfillment of the conditions laid down therein. Section 27 reads as under;
"Where any [Central Act] or Regulation made after the commencement of this Act authorises or required any document to be served by post, whether the expression "serve" or either of the expressions "give" or "sent" or any other expression is used, then, unless a different intention appears, the service shall be deemed to the effected by properly addressing, prepaying and posting by registered post, a letter containing the document, and, unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 32/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:10:31 +0530 of post."
17.13) Reference can be taken from the decision of Hon'ble Supreme Court in the case of Subodh S. Salaskar Vs. Jay Prakash M. Shah and Anr. (2008) 13 SCC 689 wherein the Hon'ble Court has categorically held that service of notice which is sought to be effected by speed post/registered post shall be deemed to have been served in the ordinary course within few days. Such persumption of delivery of notice can also be raised u/s 144 of Evidence Act.
17.14) After examining the legal position with respect to the service of any notice by way of registered post, it would be prudent to examine the instant case in realm of the above discuss legal position. In the present case, as discussed above the legal demand notice was sent on the address of the accused. At this point, it is pertinent to note that the accused has not disputed the address on which the legal demand notice was sent at any stage of trial. He simply took the plea that he has not received any legal demand notice issued by the complainant.
17.15) Therefore, in light of the above-mentioned judgment of the Hon'ble Supreme Court, I am of the considered view that a presumption regarding delivery of service of legal notice can be raised if the notice is sent through post on correct address of the accused. Hence, in the present case, since, the address of the accused on which legal demand notice was sent, is not disputed by the accused at any stage of trial. The said address seems to be correct. Legal demand notice in the present case was sent on the correct address of the accused through speed post, and, therefore, a Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 33/35 Digitally signed by KAVITA BIST KAVITA Date:
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presumption can be raised about its successful delivery and as accused has not lead any evidence regarding the non delivery of legal demand notice, hence, the accused has not been able to rebut the presumption of service of legal demand notice. Resultantly, the benefit of the presumption accrues in the favour of the complainant. So this ingredients is fulfilled as against the accused.
e.) That the drawer of the cheque fails to make the payment of the said amount of money to the payee or holder in due course within 15 days of the receipt of the said notice;
17.16) In the instant case, the accused has stated in his notice of accusation that he has not received any legal demand notice issued by the complainant. However, the accused has failed to adduce any evidence in his favour to rebut the presumption of service.
17.17) In C.C Alava Haji Vs. Palapetty Muhd. and Anr. (2007) 6 SCC 555, it was held by the Hon'ble Supreme Court "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 resepct of the complaint u/s 138 of the N.I. Act, make payment of the cheque amount and submit to the court that he had made payment within 15 days of receipt of summons and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of summons from the court along with the copy of the complaint u/s 138 of the N.I.Act, can not obviously content that there was no proper service of notice as required u/s 138, by ignoring statutory presumption to the Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 34/35 Digitally signed by KAVITA KAVITA BIST BIST Date:
2025.09.08 16:10:44 +0530 contrary u/s 27 of G.C Act and section 114 of the Evidence Act."
17.18) Hence, regardless of the said averments in respect of non receipt of legal notice, it was open to the accused to make the payment due under the cheque in question within 15 days of service of summons of the instant case. However, the accused has admittedly failed to do so, on the ground that he does not owe the liability of cheques amount, a defence which he has been able to prove at the trial. Hence, this ingredient stands fulfilled as against the accused.
18.) Decision:
As all the ingredients of the offences are not cumulatively satisfied against the accused, the accused Shyam Karan Bhardwaj is hereby acquitted of the offence u/s 138 of N.I. Act in the present matter. Digitally signed by KAVITA Announced in the open court KAVITA BIST BIST Date:
on 08.09.2025. 2025.09.08 16:10:54 +0530 (Kavita Bist) JMFC Mahila Court-01 PHC/NDD, NewDelhi Cr Cases 327/2017 Sunil Sharma Vs. Shyam Karan Bhardwaj Page No. 35/35