Delhi District Court
M/S Omaxe Ltd vs Nri City Resident Welfare Association on 30 October, 2025
CNR No. DLSE020144942020
CC No.5250/2020
M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors.
DLSE020144942020
IN THE COURT OF AJAY NARWAL, JUDICIAL MAGISTRATE,
FIRST CLASS (NI ACT), DIGITAL COURT-02, SOUTH-EAST
DISTRICT, SAKET.
M/s. Omaxe Ltd.
Having its registered Office at:
19-B, First Floor, Omaxe Celebration Mall,
Sohna Road, Gurugram, Haryana
And Corporate Office at:
7, Local Shopping Centre,
Kalkaji, New Delhi - 110019
Through its Authorized Representative
Sh. Parveen Kumar Gupta ................ Complainant
Versus
(a) NRI City Resident's Welfare Association (Regd.)
Office at:Main Gate No. 1,
NRI City, Omaxe Greater Noida,
Dist. Gautam Budh Nagar, (U.P) - 201307
Through its President/Secretary. (Accused No. 1)
(b) Sh. Jai Singh, S/o. Shri Nattha Singh
President, NRI City Resident's Welfare Association (Regd.)
Office at: Main Gate No. 1, Omaxe NRI City,
Pari Chowk, Greater Noida Dist. Gautam Budh Nagar
(U.P) - 201307
Also at:
House No. B-172, Omaxe NRI City, Pari Chowk, Greater Noida, Dist.
Gautam Budh Nagar, Digitally signed
(U.P) - 201307, (Accused No. 2) AJAY by AJAY
NARWAL
NARWAL Date: 2025.10.30
17:37:16 +0545
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CNR No. DLSE020144942020
CC No.5250/2020
M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors.
(c) Sh. Surender Pal Singh,S/o. Sh. Jai Pal Singh
Secretary, NRI City Resident's Welfare Association (Regd.)
Office at:Main Gate No. 1, Omaxe NRI City,
Pari Chowk, Greater Noida, Dist. Gautam Budh Nagar,
201307, house No. A-48, Omaxe NRI City, Pari Chowk, Greater
Noida, Dist. Gautam Budh Nagar (U.P) - 201307
(Accused No. 3)
CNR Number DLSE020144942020
Offence complained of U/s 138 NI Act
Plea of the Accused Not guilty
Date of filing 27.10.2020
Date of institution of the Case 27.10.2020
Date of decision 30.10.2025
Final Order Convicted
JUDGMENT
1. Vide this judgment, I shall decide the present matter i.e. CC No. 5250/2020 filed by complainant Omaxe Ltd. through its AR against the dishonour of a cheque bearing no. 000005 dated 15.08.2020 for a sum of Rs.2,83,523/- drawn on HDFC Bank, C-1, Alpha Plaza, Alpha Commercial Belt, Greater Noida-201306, Uttar Pradesh (henceforth, the cheque in question).
2. Shorn of unnecessary details, the brief facts of case are that the Complainant company has developed and constructed various residential as well as commercial projects across the country including the project namely 'Omaxe NRI City', Sector Omega-II, Pari Chowk, Digitally signed by AJAY NARWAL AJAY CC No. 5250/2020 NARWAL Date: Page No. 2/22 2025.10.30 17:37:24 +0545 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. Greater Noida, U.P., consisting of Residential villas, Plots etc. and had executed Allotment Letter/ buyer's Agreement in favour of different Allottees/ occupants. The said Allotment Letters/ Buyer's Agreement executed by the occupants contained a stipulation for the provision of Maintenance Services by the complainant company/Developer or by its nominated Maintenance Agency and for payment of maintenance Charges and other charges by the occupants to the Maintenance Agency. It is averred in the complaint that the Complainant nominated M/s. Shanvi Estate Management Services Pvt. Ltd., a company incorporated under the Companies Act, 1956 to provide common area Maintenance Services in the said project. Accordingly, the said Maintenance Agency was providing Maintenance Services in the said project and the residents were liable to pay the maintenance charges to the maintenance agency. It is averred in the complaint that the Accused No. 1 is the registered Resident's Welfare Association of the residents and Accused No. 2 & 3 are the President and Secretary/ office bearer of the Accused No.1, in charge and responsible for the day-to-day functioning and working of the said Association. The said office bearer of the Accused No. 1 approached to the Complainant and represented to hand over Maintenance Services/ Maintenance Charge to the accused no. 1, discharging the Complainant's as well as the Maintenance Company, since the accused no. 1 wanted to maintain the said project by its own through its office bearers/RWA. Accordingly, the Complainant and the Maintenance Company in terms of Agreement dated 16.12.2019 Digitally signed CC No. 5250/2020 AJAY by AJAY NARWAL Page No. 3/22 NARWAL Date:
2025.10.30 17:37:27 +0545 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. for handing over of Maintenance Services, handed over the Maintenance Services to the accused No. 1. It is averred in the complaint that as per Clause 6 of the aforesaid-said Agreement, the accused persons agreed to pay a sum of Rs.25,51,708.00/- (Rupees Twenty-Five Lakh Fifty-One Thousand Seven Hundred and Eight only) in (9) nine equal instalments of Rs. 2,83,523.00 (Rupees Two Lakh Eighty Three Thousand Five Hundred and Twenty Three only) each and accordingly issued 9 post-dated cheques bearing No(s) 000001, 000002, 000003, 000004, 000005, 000006, 000007, 000008, 000009 in discharge of said liability commencing from 15.04.2020 to 15.12.2020, drawn on HDFC Bank Ltd. duly signed by Accused No. 2 & 3 for and on behalf of Accused No.1 being the President and Secretary, in-charge and responsible for the working of Accused No.1, with the assurance that the said cheques shall be encashed on presentation. It is averred in the complaint that believing upon the said representation that the said cheques shall be honoured on due dates, the Complainant accepted and handed over all relevant documents to the Accused and in terms of Clause 5 of the Agreement dated 16.12.2019.
3. It is further averred in the complaint that out of the cheques issued, the Complainant had presented the cheque in question for payment through its banker i.e. AXIS Bank, Malviya Nagar Branch, New Delhi. However, to the utter shock and surprise to the Complainant, the cheque in question has been dishonoured by the Digitally signed CC No. 5250/2020 AJAY by AJAY NARWAL Page No. 4/22 NARWAL Date: 2025.10.30 17:37:38 +0545 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. banker of the accused persons for the reasons of "Account Blocked"
as per cheque return memo of the bank. Thereafter, on receipt of the dishonoured cheque from its banker, the complainant had made a demand from the accused for the payment of said cheque amount vide legal demand notice through its counsel, dispatched by speed post at the correct and proper address of the accused available with the complainant, which has been successfully delivered to all accused through speed post and courier. It is further averred in the complaint that the accused persons are duly served with the demand notice in accordance with the law. However, the accused have not made any payment to the complainant in lieu of the said dishonoured cheque till date.
4. It is pertinent to mention that the accused persons no.1, 2 and 3 were summoned in the present case and on appearance of accused persons, notice of accusation u/s 251 Cr.PC were served upon the accused persons to which all the accused persons pleaded not guilty and claimed trial. Accused persons stated that they were in-charge of maintenance of society of complainant which was later on handed over to NRI City Welfare Association. It was further stated that they were only residents of said society and when the maintenance of the society was handed over to RWA, the cheque in question was taken as security from them claiming that it is security to be given to NPCL for electricity connection. It was further stated that Complainant obtained this cheque from them with malafide intentions as they have already Digitally signed CC No. 5250/2020 AJAY by AJAY NARWAL Page No. 5/22 NARWAL Date:
2025.10.30 17:37:41 +0545 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. deposited electricity security of around Rs. 50,000/- per plot, at the time of allotment of the plot. It was further stated that complaint have misused this cheque as the electricity connection is still in the name of complainant and for security they have handed over around 9 cheques to the complainant, out of which one cheque has already been honoured. It was further stated that later-on, this account was blocked by the Registrar of Society, Meerut as said society became de- functional and in place of said society, New society i.e. NRI City Resident (Development) Welfare Association has been created, therefore, this cheque got dishonoured.
5. It is pertinent to mention that after serving of notice upon accused persons, Ld. Counsel for the complainant submitted that there is no objection on behalf of the complainant if the accused persons are allowed to cross examine the complainant witness. In view of the submission made by Ld. Counsel for the Complainant, accused persons were allowed to cross examined the AR of the complainant. Subsequently, AR of Complainant examined himself as CW1 and relied upon his evidence by way of affidavit along with the following documents:-
S.No. Documents relied upon Exhibited as:
1. Copy of Incorporation certificate dated CW1/1
06.06.2006
2. Copy of Board resolution dated 05.08.2020 CW 1/2 3. Allotment letter dated 03.07.2003 CW 1/3 Digitally signed CC No. 5250/2020 AJAY by AJAY NARWAL Page No. 6/22 NARWAL Date: 2025.10.30 17:37:48 +0545 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors.
4. Copy of the Agreement dated 16.12.2009 CW 1/4 5. Original cheque CW 1/5 6. Return memo CW 1/6 7. Legal demand notice CW 1/7
8. Original postal receipts CW 1/8 to CW1/12
9. Original Courier receipts CW1/13 to CW1/17
10. Tracking report. CW1/18 to CW1/27
11. Certificate u/s 65 B of IEA. CW1/28 and CW1/29
6. Thereafter, AR of the complainant was examined, cross- examined, and discharged as CW1. Subsequently, AR of complainant closed the complainant evidence.
7. Statement of accused persons u/s 313 Cr.PC was recorded and all the incriminating evidence were put to the them. Accused persons inter-alia, stated that the cheques were given on account of misrepresentation with malafide intentions of the complainant company on account of transferring NPCL Security in the name of Resident's Welfare Association as such, this security amount of Rs. 25,51,000/- approximately was refundable to the complainant company only. It is further stated that they have no outstanding liability towards the complainant, as they got to know from the original allottees that they have already paid security amount of Rs.
Digitally
signed by
AJAY NARWAL
AJAY
CC No. 5250/2020 NARWAL
Date:
2025.10.30
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CC No.5250/2020
M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. 50,000/- per plot to complainant company which amounts to around Rs 3 Crores cumulatively paid by all the residents on account of electricity charges at the time of allotment of plots. On being asked whether accused persons want to lead defence evidence, they replied in affirmative. Thereafter, accused namely Shri Surender Singh appeared in the witness box to examined himself in his defence evidence and he was examined, cross-examined, and discharged as DW-1. Accused persons also examined Shri Parmod Kumar Aggarwal and Shri Nitish Khurana as DW-2 and DW-3 respectively. Both the witnesses were examined, cross-examined, and discharged.
8. Thereafter, the matter was fixed for final arguments. Final arguments were heard. I have heard the counsels for both parties at length, considered the evidence led by them carefully and have perused the court records thoroughly.
INGREDIENTS OF OFFENCE AND DISCUSSION
9. Section 138 of Negotiable Instruments Act, 1881 makes dishonour of cheques an offence. It provides that "where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to Digitally signed by AJAY CC No. 5250/2020 AJAY NARWAL Page No. 8/22 NARWAL Date:
2025.10.30 17:38:00 +0545 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both".
10. In order to establish the offence under Section 138 of NI Act, the prosecution must fulfil all the essential ingredients of the offence, as highlighted below:-
1st Ingredient: The cheque was drawn by a person on an account maintained by him/her for payment of money and the same is presented for payment within a period of 3 months from the date on which it is drawn or within the period of its validity;
2nd Ingredient: The cheque was drawn by the drawer for discharge of any legally enforceable debt or other liability;
3rd Ingredient: The cheque was returned unpaid by the bank due to either insufficiency of funds in the account to honour the cheque or that it exceeds the amount arranged to be paid from that account on an agreement made with that bank;
4th Ingredient: A demand of the said amount has been made by the payee or holder in due course of the cheque by a notice in writing given to the drawer within thirty days of the receipt of information of the dishonour of cheque from the bank; and Digitally signed by AJAY CC No. 5250/2020 AJAY NARWAL Date:Page No. 9/22
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5th Ingredient: The drawer fails to make payment of the said amount of money within fifteen days from the date of receipt of notice.
11. 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 proof is beyond reasonable doubt. However, in offences under section 138 of the Act, there is a reverse onus clause contained in sections 118 and 139 of the Act. The Hon'ble Supreme Court of India in Rangappa v. Sri Mohan (2010) 11 SCC 441, has held as under:-
"Section 139 of the Act 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 a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact 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 accused/defendant cannot be expected to discharge an unduly high standard of proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, 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 that of `preponderance of Digitally signed by AJAY CC No. 5250/2020 AJAY NARWAL Page No. 10/22 NARWAL Date:
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probabilities'. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail.
12. In order to prove the aforesaid ingredients, the complainant has proved the following:-
(a) The complainant has proved the original cheque in question i.e. Ex. CW1/5. It is not disputed that the cheque in question was presented within its validity period.
(b) The cheque in question was returned unpaid vide return memo Ex. CW1/6 due to the reason, "account blocked". The same is also not disputed by accused persons.
(c) At the time of serving of notice under section 251 of CrPC, both the accused persons admitted that address mentioned in the legal notice is their correct address and they have received the legal notice.
13. As such, on the basis of the above, the first, third, fourth and fifth ingredient of the offence under Section 138 NI Act as discussed in aforesaid para 10 stands proved against the accused persons. As far as the proof of second ingredient in para 12 is concerned, the complainant is required to prove that the cheque in question was issued by the accused persons and it was drawn by the drawer for discharging a legally enforceable debt. The accused persons have admitted their signature on the cheque in question at stage of notice under section 251 Cr.P.C. Thus, presumption under section 118(a) and under section 139 of NI Act arises against the accused persons. Unless Digitally signed by AJAY NARWAL AJAY CC No. 5250/2020 NARWAL Date:
2025.10.30 Page No. 11/2217:38:14 +0545 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. the contrary is proved, it shall be presumed that the cheque in question was drawn for a consideration and that the complainant received the cheque in question in discharge of a debt/liability from the accused perons. In order to rebut the presumptions, the burden of proof shifts to the accused persons to prove on a preponderance of probabilities that there was no liability for the amount of cheques in question. (Reliance placed on Triyambak S. Hegde vs Sripad decided by 3 judge bench of Hon'ble SC on 23.09.2021 and Basalingappa vs Mudibasappa (2019) 5 SCC 418)
14. Therefore, in the present matter, the onus of proof is now upon the accused persons to raise a probable defence and to rebut the presumption of the existence of a legally recoverable debt arisen in favour of the complainant. It is now to be examined as to whether the accused persons have brought any material on record for dislodging the presumption which meets the standard of preponderance of probabilities.
15. It is pertinent to mention that accused persons have taken the defence that the present case against them is not maintainable as they were only residents of the society i.e accused no. 1. It is an admitted position that accused no. 1 is a society and accused persons are residents of the society, however, accused number no. 2 and 3 were also the President and Secretary of the accused no. 1 when the cheque in question was handed over to the complainant company. Further, it Digitally signed CC No. 5250/2020 AJAY by AJAY Page No. 12/22 NARWAL NARWAL Date: 2025.10.30 17:38:20 +0545 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. is mentioned in the agreement Ex. CW1/4 that accused no. 1 i.e NRI City residents Welfare Association is a society which is duly registered under Society Registration Act, 1980. Section 6 of the Society Registration Act, 1980 reads as under:-
"6. Suits by and against societies.− Every society registered under this Act may sue or be sued in the name of the president, chairman, or principal secretary, or trustees, as shall be determined by the rules and regulations of the society, and, in default of such determination, in the name of such person as shall be appointed by the governing body for the occasion: Provided that it shall be competent for any person having a claim or demand against the society, to sue the president or chairman, or principal secretary or the trustees thereof, if on application to the governing body some other officer or person be not nominated to be the defendant. Section 6 clearly provides that President or Principal Secretary may be sued for having a claim against the society. In the present case, the cheque in question was handed over to the complainant company by the accused no. 2 and 3 in the capacity of President and Secretary on behalf of the accused no.
1. Therefore, the defence of the accused persons that they were only residents is rejected as they are being sued by the complainant in the capacity of president and secretary of accused no. 1.
16. In the present case, the accused persons have admitted their signature upon the cheques in question. As per the scheme of the NI Act, once the accused admits signature on the cheque in question, CC No. 5250/2020 AJAY Digitally signed by AJAY NARWAL Page No. 13/22 NARWAL 17:38:23 +0545 Date: 2025.10.30 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. certain presumptions are drawn, which result in shifting of onus. Section 118(a) of the NI Act lays down the presumption that every negotiable instrument was made or drawn for consideration. Another presumption is enumerated in Section 139 of NI Act. The provision lays down the presumption that the holder of the cheque received it for the discharge, in whole or part, of any debt or other liability. The combined effect of these two provisions is a presumption that the cheque was drawn for consideration and given by the accused for the discharge of debt or other liability. Both the sections use the expression "shall", which makes it imperative for the court to raise the presumptions, once the foundational facts required for the same are proved. Reliance is placed upon the judgment of the Hon'ble Supreme Court, Hiten P. Dalal vs. Bratindranath Banerjee (2001) 6 SCC 16. So far as the facts of liability is concerned, in view of mandatory presumption of law as discussed above, if any cheque has been produced by the complainant bearing the signatures of the accused, there cannot be any inherent lacuna in the existence of the liability. But then definitely, accused can point loop holes in the story of the complainant by impeaching the credit of the witness during his cross examination. The accused can discharge his burden by demonstrating the preponderance of probabilities coming in its way.
17. It is pertinent to mention that accused persons have taken the defence that the account of the accused no. 1 was frozen by the order of the Deputy Registrar, as such, accused persons have no liability Digitally signed CC No. 5250/2020 Page No. 14/22 AJAY by AJAY NARWAL NARWAL Date: 2025.10.30 17:38:43 +0545 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. towards the complainant. Ld. Counsel for the accused persons has also relied upon the judgements in the case of M/s. Best Buildwell Pvt. Ltd. & Ors. Vs. M/s. R.D. Sales, 2025, SCC Online Del 4267, Vijay Chaudhary Vs. Gyan Chand Jain, 2008, SCC Online Del 554 and Raj Khurana Vs. State of NCT of Delhi (2009) 6 SCC 72 . The judgments referred by the Ld. Counsel for the accused persons is not applicable to the present case as the facts of the present case are different from the facts of the aforesaid cases. It is pertinent to mention that in the present case, accused persons have given 9 post-dated cheques in lieu of the agreement signed between the complainant and the accused persons and one of the cheques i.e. no. 000004 was got honoured and other cheque were got dishonoured. Therefore, when the cheque in question was given by the accused persons then the account from which the said cheque was given was operative as one of the cheques was also honoured. If due to certain events, the account of the accused no. 1 was blocked and cheque in question was dishonoured on presentation then accused persons cannot take the defence that they have no liability towards the complainant because when the cheque in question was given to the complainant then the account of the accused persons was operative. Therefore, this defence of the accused persons is rejected.
18. Ld. Counsel for the complainant during final arguments submitted that accused persons have admitted their signature on the cheques in question when the notice was served upon them under Digitally signed by CC No. 5250/2020 AJAY AJAY NARWAL Page No. 15/22 Date:
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M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. section 251 of Cr.PC as such presumption is raised in favour of the complainant and accused persons have failed miserably to rebut the said presumption. Whereas, Ld. counsel for accused during final arguments submitted that complainant has already charged Rs. 50,000 towards the electricity connection/installation from the residents as such, there is no legally enforceable debt or liability exists in respect of dishonored cheque. It is pertinent to mention that accused persons have taken the defence when the notice was served upon them that inter-alia, that cheque in question was taken as security from them claiming that it was security to be given to NPCL for electricity connection. It is pertinent to mention that complaint has placed on record agreement i.e Ex. CW1/4 which was duly signed by the accused persons no. 2 and 3 on behalf of accused no. 1 and the said agreement was duly executed between the complainant, M/s. Shanvi Estate Management Services Private Limited and the accused no. 1. Clause 6 of the said agreement clearly mentions that accused no. 1 requested the complainant to accept the sum of Rs. 25,51,708 as a refund of electricity security deposit in nine instalments of Rs. 2,83,523 through 9 post dated cheque including the cheque in question. Therefore, agreement was executed between the complainant and the accused persons wherein it was agreed that accused persons will refund Rs. 25,51,708 to the complainant and in lieu of the same 9 post dated cheques are given by the accused persons. After voluntarily executing the aforesaid agreement and agreeing to refund Rs. 25,51,708 to the complainant, now, the accused Digitally signed CC No. 5250/2020 AJAY by AJAY NARWAL Page No. 16/22 NARWAL Date: 2025.10.30 17:38:52 +0545 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. persons cannot take the plea that the cheque in question was taken as security from them claiming that it was security to be given to NPCL for electricity connection. The agreement CW1/4 clearly provides that accused persons agreed to refund the amount of Rs. 25,52,708 to the complainant. Therefore, when the agreement is clear about the refund of the electricity security deposit by the accused persons now, they cannot take the defence that they gave the cheque in question for some other purpose or fraud was played with them while executing the agreement. It is also pertinent to mention that accused persons have failed to explain as to why the aforesaid agreement which clearly provides the return of electricity security deposit was executed by the accused persons with the complainant company when the residents have already paid the charges towards the electricity charges. Even if for arguments sake, it is agreed that complainant company has played fraud upon the accused persons and deceived them into entering the aforesaid agreement, there is no explanation on behalf of the accused persons as to why they have not any action to rescind the aforesaid agreement when they came to know about the fraud of the complainant company and same cast a shadow of doubt upon the defence taken by the accused persons. Moreover, the arguments that complainant has already taken Rs. 50,000/- towards electricity charges does not any water and it is nowhere mentioned in agreement Ex. CW1/4 that Rs. 50,000/- paid by the residents also include the amount of the security deposit paid by the complainant company.
Digitally
signed by
AJAY
AJAY NARWAL
CC No. 5250/2020 NARWAL Date: Page No. 17/22
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19. It is pertinent to mention that when the notice under section 251 of CrPC was served upon the accused persons then they stated that inter-alia, cheque in question was taken as a security from them so that same may be given to the NPCL and cheque in question was misused. This Court has failed to understand that when the accused knew that cheque in question was misused and same was given under the pretext that it will be given to NPCL then why they have executed the agreement Ex. CW1/4 wherein they agreed to refund the amount of Rs.25,51,708 and also gave the cheque in question towards the said amount. It is also pertinent to mention that accused persons despite knowing that complainant company is misusing the cheque in question have not made a single complaint against the complainant company before the concerned authorities. It is difficult to believe that accused persons did not take action despite knowing that cheque in question may be misused by complainant company. Hence, this Court is of the view that accused has not led any cogent evidence to establish it or draw any circumstance against the case of the Complainant which probabilizes their defence.
20. The Hon'ble Delhi High Court in the case of Amit Jain Vs Sanjeev Kumar Singh & othr (CRL.A. 1248/2019) has observed as follows: -
"14. When presumption under Section 139 was raised, Trial Court ought to have conducted proceedings basis that the cheque was issued in discharge of a debt or liability towards the complainant. At this juncture, the onus was on the accused to rebut the presumption under Digitally signed by AJAY CC No. 5250/2020 AJAY NARWAL Page No. 18/22 NARWAL Date:
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Section 139. Had the accused been successful in rebutting said presumption, the onus would have then shifted onto the complainant/appellant. The fundamental flaw on part of Trial Court was failing to note effect of the presumption under Section 139 NI Act. As a result, Trial Court erroneously proceeded to deliberate upon want of evidence on part of appellant/complainant i.e. no interest was charged, friendly relations between the parties were not proved, financial capacity not established, and most importantly, guilt of the accused was not proved beyond reasonable doubt. 15.6 This brings us to yet another flaw in the impugned judgement i.e. conclusion that respondent/accused successfully rebutted the presumption under Section 139 only on the basis of his statement under Section 313 CrPC, having not led any defence evidence. To this effect, observations of a co-ordinate Bench of this Court in V.S. Yadav v. Reena 2010 SCC OnLine Del 3294 are relevant; same are extracted as under:
"8. The respondent has placed reliance on Krishna Janardhan Bhat v.
Dattatraya G. Hegde, 2008 Crl. L.J. 1172, which is also the case relied upon by the Trial Court. In this judgment itself Hon'ble Supreme Court has specifically observed that Court should not be blind to the ground realities and the rebuttal of presumption under Section 139 of N.I. Act would largely depend upon the factual matrix of each case. The Trial Court in this case turned a blind eye to the fact that every accused facing trial, whether under Section 138 of N.I. Act or under any penal law, when charged with the offence, pleads not guilty and takes a stand that he has not committed the offence. Even in the cases where loan is taken from a bank and the cheques issued to the bank stand dishonoured, the stand taken is same. Mere pleading not guilty and stating that the cheques were issued as security, would not give amount to rebutting the presumption raised under Section 139 of N.I. Act. If mere statement under Section 313, Cr. P.C. or under Section 281, Cr. P.C. of accused of pleading not guilty was sufficient to rebut the entire evidence produced by the complainant/prosecution, then every accused has to be acquitted. But, it is not the law. In order to rebut the presumption under Section 139 of N.I. Act, the accused, by cogent evidence, has to prove the circumstance under which cheques were issued. It was for the accused to prove if no loan was taken why he did not write a letter to the complainant for return of the cheque. Unless the accused had proved that he acted like a normal businessman/prudent person entering into a contract he could not have rebutted the presumption under Section 139, N.I. Act. If no loan was given, but cheques were retained, he Digitally signed by AJAY CC No. 5250/2020 AJAY NARWAL Page No. 19/22 NARWAL Date:
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immediately would have protested and asked the cheques to be returned and if still cheques were not returned, he would have served a notice as complainant. Nothing was proved in this case. 9. In this case no evidence, whatsoever, was produced by the accused and the Trial Court travelled extra steps, not permitted by law, to presume that the presumption has stood rebutted. I, therefore, set aside the judgment of the Trial Court. (emphasis supplied).
16. Thus, respondent no. 1 having not led defence evidence, his statement under Section 313 CrPC cannot be read as evidence for the purpose of rebutting presumption raised under Section 139 NI Act. In this light, merely pleading not guilty would not suffice to rebut this presumption either.
17. We often find that acquittals in Section 138 NI Act proceedings place the burden of proving the existence of the debt on the complainant, which is diametrically opposite to the presumption placed on the accused under Section 139 NI Act. The accused often gets away with an acquittal, despite having tendered and even admitting to the cheque, merely because the complainant is unable to produce documents to support the existence of the debt (usually in the form of a friendly loan provided in cash, which does not have any document trail). It would be unwise for the court to not acknowledge that friendly cash loans are provided by parties, sometimes based on small savings of the lender. In these circumstances rather than focussing on the question as to why the accused gave the cheque in the first place (which he or she admits), the complainant is left unhinged for inability to provide any documentation. Often when accused is asked by the court, as to for what purpose they gave the cheque in the first place, a cogent and rational answer is not forthcoming.
18. Presumption under Section 139 read with Section 118 of the NI Act is essentially based on pure common sense. Instead of having the accused prove to the contrary, the accused is acquitted, as in this case,without having led any defence evidence and purely relying upon the inconsistencies in the affirmative proof provided by the complainant. The law and its application, is therefore turned on its head.
21. It is pertinent to the Hon'ble Delhi High Court has held in the aforesaid judgement that when presumption under Section 139 was raised, then the Trial Court ought to have conducted proceedings basis Digitally signed by AJAY CC No. 5250/2020 AJAY NARWAL Page No. 20/22 NARWAL Date:
2025.10.30 17:39:13 +0545 CNR No. DLSE020144942020 CC No.5250/2020 M/s OMAXE Ltd Vs. NRI City Resident's Welfare Ass. (Regd.) Ors. that the cheque was issued in discharge of a debt or liability towards the complainant and the onus was on the accused to rebut the presumption under Section 139. In the present case, accused persons have not produced any ocular or documentary evidence to contradict the agreement Ex. CW1/4 which clearly mentions the liabilities of the accused persons. In view of the aforesaid judgement of Delhi High Court, accused cannot take the rebut the presumption merely finding loop holes in the case of the complainant case without proving their defence.
22. On a consideration of the totality of factors pleaded by the accused persons in their defence, it becomes clear that the accused persons have merely paid lip service to their defence and has not led any cogent evidence to establish it or draw any circumstance against the case of the Complainant which probabilizes their defence.
Accordingly, accused persons no. 1, 2 and 3 namely NRI City Residents Welfare Association, Shri Jain Singh and Surender Pal Singh are convicted of the offence u/s 138 NI Act.
23. Let a copy of this judgment be given to the convict free of cost. Dictated directly into the computer Digitally signed by AJAY AJAY NARWAL and announced in the open Court, on 30.10.2025 NARWAL Date:
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It is certified that this judgment contains 22 pages and same bears my Digitally signed signatures. by AJAY AJAY NARWAL NARWAL Date:2025.10.30 17:39:18 +0545 (AJAY NARWAL) JMFC (NI Act) Digital Court- 02 South East- Saket 30.10.2025 Certificate The convict has been apprised that accused persons are entitled to avail the services of LAC for pursuing higher remedies which includes filing of appeal against the aforesaid judgment. The convicts has also been apprised about the address and the contact of concerned official from South East District Legal Services Authority, Utility Block, Ground Floor, Saket Court, New Delhi, Phone No. 29561040, email:- [email protected].Digitally signed by AJAY
AJAY NARWAL NARWAL Date:
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