Delhi District Court
Kailash Chand Kala, Proprietor Of ... vs Kh Contracts Pvt Ltd And Surender Katyal on 4 May, 2026
Page 1 of 5
IN THE COURT OF SH. PRANJAL GANGWAR,
JMFC NI ACT-03, CENTRAL, TIS HAZARI COURTS, DELHI
1. Complaint case Number : 2825/2023
2. Name & Address of : Kailash Chand Kala
Complainant proprietor of Quality Engineer
ing
office address 3385, Hakim
Baqa Street, Hauz Qazi, New
Delhi-110006.
3. Name & Address of : KH Contracts Pvt. Ltd.
Accused Corporate office: 405, Ground
Floor, DDA Flats, New Ranjit
Nagar, New Delhi-110008.
Surender Katyal
Director in KH Contracts Pvt.
Ltd.
Corporate office: 405, Ground
Floor, DDA Flats, New Ranjit
Nagar, New Delhi-110008.
4. Offence complained : Section 138 r/w 141
Negotiable Instruments Act,
1881
5. Plea of guilt : Pleaded guilty
6. Final order : Convicted
7. First date of hearing : April 19, 2023
8. Date on which case : May 04, 2026
was reserved for judgment
9. Date of judgment : May 04, 2026
CC NI ACT 2825-23
KAILASH CHAND KALA, PROPRIETOR OF QUALITY ENGINEERING Vs. KH CONTRACTS PVT LTD AND SURENDER
KATYAL
Digitally
signed by
PRANJAL
PRANJAL GANGWAR
GANGWAR Date:
2026.05.04
16:09:50
+0530
Page 2 of 5
JUDGMENT
1. The present Judgment is a result of culmination of trial initiated on the complaint filed under Section 138 of Negotiable Instruments Act, 1881 (Hereinafter referred to as "NI Act") by the complainant, Kailash Chand Kala proprietor of Quality Engineering against the accused, KH Contracts Pvt Ltd. and Surender Katyal.
BRIEF FACTS OF THE CASE
2. Case of the complainant is that between 2018-2020 accused purchased var- ious articles amounting to Rs. 498970/- from the complainant on credit ba- sis. Copy of invoices is Ex.CW1/C (colly.) and ledger account is Ex.CW1/D (colly.) in the year 2020. Complainant requested the accused to clear the outstanding amount of Rs. 318328/-. Thereafter, to discharge liability, ac- cused issued one cheque i.e. cheque bearing No. 000326 dated 25.09.2022, amounting to Rs. 318328/- drawn on HDFC Bank, Patel Nagar, Delhi-110008. Complainant presented the said cheque for encashment. However, the said cheque was returned dishonoured on 23.12.2022 with reason "Funds Insufficient. Thereafter, legal demand notice dated 17.01.2023 was served upon the accused. However, accused has failed to make the payment within 15 days of receipt of the notice. Hence, the present complaint.
CC NI ACT 2825-23 KAILASH CHAND KALA, PROPRIETOR OF QUALITY ENGINEERING Vs. KH CONTRACTS PVT LTD AND SURENDER KATYAL Digitally signed by PRANJAL PRANJAL GANGWAR GANGWAR Date:
2026.05.04 16:09:54 +0530 Page 3 of 5 PLEA OF DEFENCE OF ACCUSED
3. During the course of trial, accused no. 1 & 2 were summoned vide sum-
moning order dated 01.08.2023. On summon, accused entered his appear- ance and it was duly ensured that copy of complaint alongwith relevant documents have been supplied to the accused. Thereafter, notice of accu- sation was given to accused no. 1 & 2 on 04.05.2026 to which they pleaded guilty and did not claim trials.
4. I have perused the case file, documents placed on record by both the parties and duly considered the submission made by Ld. Counsel for complainant and accused.
BRIEF REASONS FOR THE JUDGMENT
5. Before adverting to the facts of the instant complaint, it is pertinent to re- produce Section 118(a) and 139 of the NI Act. Section 118(a) reads as:
"Until the contrary is proved, the following presumptions shall be made: that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration."
Further, Section 139 reads as under:
"It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in Section 138 for the discharge, in whole or in part, or any debt or other liability."
CC NI ACT 2825-23 KAILASH CHAND KALA, PROPRIETOR OF QUALITY ENGINEERING Vs. KH CONTRACTS PVT LTD AND SURENDER KATYAL Digitally signed by PRANJAL PRANJAL GANGWAR GANGWAR Date:
2026.05.04 16:09:59 +0530 Page 4 of 5
6. As per Section 118 (a) of the NI Act, there is a presumption in favour of complainant that the instrument i.e. cheque in dispute was issued for consideration and further under Section 139 of the Act, it is presumed that the holder of the cheque received the cheque for discharge of a legally enforceable debt or other liability.
7. Section 252, Cr.P.C. is also pertinent to be examined at this stage. Section 252 states:
"If the accused pleads guilty, the Magistrate shall record the plea as nearly as possible in the words used by the accused and may, in his discretion convict him thereon".
Perusal of the record shows that complainant has also annexed with the complaint original cheques, return memo and legal notice u/s 138 NI Act. Accused during notice of accusation stated that he plead guilty. Perusal of the record shows that accused has not disputed anywhere that address mentioned on the legal demand notice is not his address. Therefore, the court finds that legal demand notice was sent on the correct address of accused. Hon'ble Supreme Court in the case of C.C Alavi Haji (Supra) held that it shall be presumed in terms of Section 27 of General Clauses Act that service of notice has been effected when it has been sent on the correct address.
8. From the master data of accused company it is clear that accused no. 2 is the director of accused no. 1. Further accused has not disputed the said fact that he was not the director. Perusal of the cheque in question also shows that the same bears his signature. Accordingly, it is presumed that accused no. 2 was actively involved in the affairs of accused no. 1.
CC NI ACT 2825-23 KAILASH CHAND KALA, PROPRIETOR OF QUALITY ENGINEERING Vs. KH CONTRACTS PVT LTD AND SURENDER KATYAL Digitally signed by PRANJAL PRANJAL GANGWAR GANGWAR Date:
2026.05.04 16:10:03 +0530 Page 5 of 5
9. Accordingly, the Court finds that accused has pleaded guilty voluntarily without any undue influence, coercion or pressure. In view of the plea of guilt of the accused, settled law and evidence of complainant, accused Mr. K H Contracts Pvt. Ltd and Mr. Surender Katyal are held guilty and are hereby convicted for the offence under Section 138 of NI Act.
10.This judgment contains 05 pages and each page bears the signature of the undersigned.
11.Copy of the judgment be uploaded as per rules.
12.Copy of this judgment be given to the convict free of cost as per rules. Convict be now heard on the quantum of sentence. Pronounced in an open court today. Digitally signed by PRANJAL PRANJAL GANGWAR GANGWAR Date:
2026.05.04 16:10:07 +0530 (PRANJAL GANGWAR) JMFC- NI Act- 03, Central Tis Hazari Court, Delhi May 04, 2026 CC NI ACT 2825-23 KAILASH CHAND KALA, PROPRIETOR OF QUALITY ENGINEERING Vs. KH CONTRACTS PVT LTD AND SURENDER KATYAL