Delhi District Court
Abhimanyu Malakar vs Narinder Kumar Chaudhary on 29 July, 2025
IN THE COURT OF JMFC (NI ACT) DIGITAL COURT -01, SOUTH-WEST, DWARKA COURTS,
NEW DELHI
(Presided Over by SH. SHUBHAM GUPTA)
Case No. Ct. Cases/ 633/1/2013 (2575/2016)
Unique Case ID No.
In the matter of :-
ABHIMANYU MALAKAR ... Complainant
VS.
NARINDER KUMAR CHAUDHARY ... Accused
1. Name of Complainant : SH. ABHIMANYU MALAKAR
2. Name of Accused : SH. NARINDER KUMAR CHAUDHARY
3. Offence complained of or proved : Section 138, Negotiable Instruments Act,
1881.
4. Plea of Accused : Not Guilty
5. Date of Filing : 09.10.2013
6. Date of Reserving Order : 02.07.2025
7. Date of Pronouncement : 29.07.2025
8. Final Order : CONVICTED
JUDGMENT
Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 1 of 21 A. FACTUAL MATRIX:
1. The present complaint has been filed under section 138 of the Negotiable Instruments Act, 1881 (hereinafter "NI Act") by Sh. Abhimanyu Malakar (hereinafter "complainant") against Sh. Narinder Kumar Chaudhary (hereinafter "accused").
The substance of allegations, as contained in the complaint, are as follows:
2. That the complainant and accused are well known to each other being family friends and somewhere in December 20, 2009, accused represented to complainant that accused was in grave financial difficulty and therefore requested the complainant to advance accused a friendly loan of Rs. 1,50,000 for one year, which accused stated to be required to meet his immediate financial commitments.
3. That because of the cordial relationship between the parties, the complainant advanced the said amount of Rs. 1,50,000 to the accused in cash in the month of January 2010, after arranging the same from his relatives.
4. That against the loan of Rs. 1,50,000, accused issued two post dated cheques i.e. one cheque of Rs.
1,00,000 bearing number 860947 dated 15.06.2013 drawn on State Bank of Patiala, Paschim Puri Branch and another cheque bearing number 395812 of Rs. 50,000 dated 30-07-2013 drawn on State Bank of India, Paschim Vihar branch.
5. That when the payment of the first cheque became due, the accused requested the complainant not to deposit the cheque and sought 15 days time. That just before the expiry of 15 days time, the accused again requested the complainant to further sought 15 days time. Eventually, on the assurance of the accused, the complainant deposited the said cheque bearing number 860947 dated 15.06.2013 with his banker, the South Indian Bank on 22.07.2013. However, to the utter shock and surprise of the complainant, the above said cheque was returned unpaid by the accused banker vide its separate return memo dated 24.07.2013 which was received by the complainant on 26.07.2013 with remarks 'exceeds arrangement'.
Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 2 of 21
6. That thereafter, the complainant deposited the second cheque bearing number 395812 dated 30.07.2013 of Rs. 50,000. However, to the utter shock and surprise of the complainant, the above said cheque was also returned unpaid by the accused banker vide its separate returned memo dated 28.07.2013 with remarks 'funds insufficient' which was received by the complainant on 4.08.2013. The said cheques were returned by the accused banker since the accused failed to maintain sufficient balance in his account to honour the same.
7. That the above said cheques were issued against the loan advanced by the complainant to accused and as such, it is submitted that the said cheques were issued by the accused against a legally recoverable debt.
8. That as per the requirement of Section 138 of the NI Act, the complainant, through his advocate, issued a legal notice dated 23.08.2013, sent through registered AD on 24.08.2013 and through courier on 23.08.2013, raising the demand of payment of Rs 1,50,000 being the amount of the two cheques mentioned above within the time prescribed.
9. However, despite service of the legal notice, the accused has failed to pay the amount of the said cheques to the complainant. That for the submissions made above, it is submitted that the accused has committed an offence under Section 138 of the NIA Act and is liable to be prosecuted as per the provisions of the same.
B. PRE-SUMMONING EVIDENCE & NOTICE
10. Pre-summoning evidence was led by the complainant and summons were issued against the accused on 09.10.2013. Notice against the accused was framed on 23.11.2015. The following plea of defence was taken by the accused at the stage of framing of notice:
I do not plead guilty and have defense to make. The present cheques in question bear my signatures and I have filled up the other particulars in the cheques.
Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 3 of 21 I know the complainant and his wife Ms Savita. Ms Savita was working under me in my department and I had taken a loan in the sum of Rs 1.5 lakhs from her and issued the cheques in question to her qua the same. And I had repaid the above said loan amount to Ms Savita in cash and Ms Savita issued me a receipt for the repayment.
I do not owe the liability towards the complainant qua the cheques in question. I had asked Ms Savita to return the cheques in question after repayment of the loan amount but she said not to do so on the pretext that cheques were lying with her husband and she would return the same later. I have not received the legal demand notice from the complainant. I want to lead defense evidence.
The accused admitted his signatures on the cheques in question.
C. COMPLAINANT'S EVIDENCE
11. During the trial, the complainant has led the following oral and documentary evidence against the accused to prove its case beyond reasonable doubt: -
Oral & Documentary Evidence Ex.CW1/1 and CW1/3 - Cheques in question Ex. CW1/2 and CW1/4 - Return memos of the cheques in question Ex.CW1/5 - Legal demand notice dated 23.08.2013 Ex. CW1/6 - Original postal receipt Ex. CW1/7 - Original courier receipt Ex. CW1/8 - Acknowledgment of Indian Post Ex. CW1/B - Evidence Affidavit of the Complainant D. STATEMENT OF ACCUSED
12. Thereafter, before the start of defence evidence, in order to allow the accused to personally explain the circumstances appearing in evidence against him, statement under Section 313 CrPC was recorded without oath. In reply, the accused denied all the allegations against him. The accused submitted the following in his statement under section 313 CrPC:
a. It is incorrect. I approached the wife of the complainant for the said loan who arranged and had given to me. Upon asking of the wife of the complainant, I issued security cheques in the name of the complainant for the repayment of the loan which was taken by me from the Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 4 of 21 wife of the complainant. The said cheques were never returned to me. Even after repaying the said loan, I do not have any liability towards the complainant. b. I do not know as there was some communication between the wife of the complainant and me and that she will inform before honoring the cheques or she will accept the said amount in the month of October 2014. So, the said cheques were dishonored. Thereafter, I immediately made payment to the wife of the complainant.
c. I did not receive the legal demand notice. I have already repaid the entire loan amount to the wife of the complainant who issued receipt for the same amount which is on record. There is no legally enforceable debt or other liability was ever existed or pending against the complainant. I have written only the name of the payee and the signatures on the cheques in question.
d. No, I only know his wife as she was working in my office. I gave the cheques in question as security cheques to the wife of the complainant. I have no liability towards the complainant. I have already repaid the entire loan amount to the wife of the complainant and she has also issued a receipt for the same. The complainant wants to gain wrongfully. That is why he has deposed against me.
13. The accused chose to lead DE and thereafter, the matter was listed for final arguments. After listening to final arguments from both sides, the matter was reserved for pronouncement. I have heard the learned counsels on both the sides and have given my thoughtful consideration to the material appearing on record and the judicial precedents relied by the both sides.
E. INGREDIENTS OF OFFENCE UNDER SECTION 138 OF NI ACT
14. Before dwelling into the facts of the present case, it would be pertinent to discuss the legal standards required to be met by both sides. 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: -
a) 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;
b) The cheque was drawn by the drawer for discharge of any legally enforceable debt or other liability;
Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 5 of 21
c) 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;
d) 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.
e) The drawer fails to make payment of the said amount of money within fifteen days from the date of receipt of notice.
15. In addition to the above, the conditions stipulated under Section 142 NI Act have to be fulfilled.
F. ANALYSIS OF VARIOUS INGREDIENTS OF THE OFFENCE
16. The complainant has proved the original cheques, Ex.CW1/1 and CW1/3, which the accused has not disputed as being drawn on his account. The accused has also admitted his signatures on the cheques in question and admitted that all the particulars were also filled by him on the cheques in question.
17. The cheques in question was returned unpaid vide Ex. CW1/2 and Ex. CW1/4 Return memos dated 24.07.2013 and 02.08.2013 respectively. The same has also been proved by the complainant. As per Section 146 of NI Act, Bank's slip is prima facie evidence of proof of dishonor. The accused has not disputed the same.
Contention: Legal Notice was sent beyond the prescribed time period of 30 days by the complainant
18. The complainant has proved on record legal notice dated 23.08.2013 Ex.CW1/5. The accused denied receipt of any legal notice, however, the address mentioned on the legal notice has not been stated to be incorrect address by the accused. Further, the accused had also mentioned the same address as that of the legal notice address at various stages of the trial.
19. Ld. Counsel for the accused contends that the legal notice in the present case is time barred qua cheque bearing no. 860947 since the same was sent by the complainant through registered post on 24.08.2013. The complainant in his complaint and evidence affidavit had stated that he had Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 6 of 21 received the return memo dated 24.07.2013 of cheque bearing no. 860947 on 26.07.2013 with remarks "exceeds arrangement". It has been contended on behalf of the accused that the complainant in his cross-examination had admitted that the cheque bearing no. 860947 was dishonoured on 24.07.2013 and he received the return memo of the said cheque on the same date from his bank and hence, the complaint is not maintainable qua the cheque bearing no. 860947.
20. On the other hand, the Ld. Counsel for the complainant contends that the complainant had received the return memo of cheque bearing no. 860947 on 26.07.2013 as stated in his complaint and even if assuming that the same was received on the same date as that of the date of the return memo dishonour, then also, the complaint qua cheque bearing no. 860947 is maintainable since the provision under section 138 does not prescribe any specific mode of giving of the legal notice and the complainant had complied with the mandate of the law by giving the legal notice through courier services on 23.08.2013, which is well within the time limit prescribed.
21. Before adverting to the issue at hand, it is apposite to refer to the judgement of the Hon'ble Supreme Court of India in the case of C.C. Alavi Haji vs Palapetty Muhammed & Anr, wherein the Hon'ble Apex Court noted as follows: -
"....The issue with regard to interpretation of the expression giving of notice used in Clause (b) of the proviso is no more res integra. In K. Bhaskaran Vs. Sankaran Vaidhyan Balan & Anr., the said expression came up for interpretation. Considering the question with particular reference to scheme of Section 138 of the Act, it was held that failure on the part of the drawer to pay the amount should be within fifteen days of the receipt of the said notice. Giving notice in the context is not the same as receipt of notice. Giving is a process of which receipt is the accomplishment. It is for the payee to perform the former process by sending the notice to the drawer at the correct address and for the drawer to comply with Clause (c) of the proviso. Emphasizing that the provisions contained in Section 138 of the Act required to be construed liberally, it was observed thus: If a strict interpretation is given that the drawer should have actually received the notice for the period of 15 days to start running no matter that the payee sent the notice on the correct address, a trickster cheque drawer would get the premium to avoid receiving the notice by different strategies and he could escape from the legal consequences of Section 138 of the Act. It must be borne in mind that Court should not adopt an interpretation which helps a dishonest Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 7 of 21 evader and clips an honest payee as that would defeat the very legislative measure. In Maxwell's Interpretation of Statues the learned author has emphasized that "provisions relating to giving of notice often receive liberal interpretation," (vide page 99 of the 12th Edn.) The context envisaged in Section 138 of the Act invites a liberal interpretation for the person who has the statutory obligation to give notice because he is presumed to be the loser in the transaction and it is for his interest the very provision is made by the legislature. The words in Clause (b) of the proviso to Section 138 of the Act show that payee has the statutory obligation to make a demand by giving notice. The thrust in the clause is on the need to make a demand. It is only the mode for making such demand which the legislature has prescribed. A payee can send the notice for doing his part for giving the notice. Once it is dispatched his part is over and the next depends on what the sendee does....."
22. It is important to note that the law does not provide any specific mode for giving of the legal notice by the complainant to the accused. It is also settled that if the legal notice is sent at the correct address by the complainant through registered post, then presumption of service may be drawn by the court on the accused under section 27 of the General Clause Act read with section 114 of the Indian Evidence Act. It is settled law that the presumption available to the complainant under the General Clauses Act is a specific presumption which is rebuttable and presumption available to the complainant under section 114 Indian Evidence Act is a general presumption and the same is also rebuttable.
23. Coming to the facts of the case, the complainant had admitted in his cross-examination that he had received return memo on the same date i.e. 24.07.2013 which is mentioned on the return memo qua the first cheque in question and considering the same date, it is contended on behalf of the accused that the present complaint is barred by law since the notice to the accused was sent by the complainant on the 31st day of the date of the return memo of the first cheque in question which is not allowed by the law as the same has to be sent within a period of 30 days from the date of receipt of the return memo.
24. Perusal of the record reveals that the complainant in fact had sent the legal notice by way of a courier and registered post. The original receipts of the courier Ex. CW1/7 and the postal receipt Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 8 of 21 Ex. CW1/6 have been placed on record by the complainant. The accused had taken the plea throughout the trial that he had not received the legal demand notice from the complainant. However, the address mentioned on the legal notice is the same address which the accused has furnished before the court at various stages of the trial in various documents and depositions. Hence, the accused had not contested that his address on the legal notice is an incorrect address or the complainant had sent the legal notice at an incorrect address either by registered post or courier.
25. Further, during the cross-examination of the complainant, the accused had given the suggestion qua the effect that the present complaint is barred by law since the legal notice in the present case was sent on the 31st day by the complainant. However, the accused has not given any specific suggestion to the complainant in his cross-examination to the effect of the original courier receipt being false and fabricated. Neither the accused had challenged the genuineness of the courier receipt on record nor cross-examined the complainant on the said aspect in his cross-examination.
26. Further, the deposition of the complainant regarding sending of the legal notice through courier has gone unchallenged by the accused. The complainant in his evidence affidavit had deposed that he had sent the legal notice by way of courier on 23.08.2013. The accused has also not stated anywhere or taken the plea that the courier was not sent on the correct address of the accused or has not taken the plea that the legal notice was not sent by way of courier within 30 days. Further, the cross-examination of the complainant on behalf of the accused is also silent on this aspect.
27. It is nowhere stated that the legal notice can not be sent by way of courier by the complainant and it has to be sent by the registered post only. Regarding the actual sending of the legal notice by way of courier, the complainant has placed the original receipt of the courier on record which the accused has not disputed to be incorrect or false. Further, section 114 of the Indian Evidence Act provides that the court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case. Further, the illustration (f) provides that the court may presume that the common course of business has been followed in particular cases. The said presumption is a rebuttable presumption. Hence, when it appears to the Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 9 of 21 court that the common course of business renders it probable that a particular thing would happen then the court may draw the said presumption that the thing would have happened unless there are circumstances in a particular case to show that the common course of business was not followed. (Reliance is placed on the judgment of Hon'ble Apex Court in the case of C.C. Alavi Haji vs Palapetty Muhammed & Anr). Hence, in view of the original courier receipt on record Ex. CW1/7 and non-challenge of the same by the accused either in the cross-examination or throughout the trial, the court does not find any reason to discard the same as being forged and fabricated.
28. In the present case, the accused has not shown anything or brought anything on record which will go on to indicate that the common course of business was not followed in the case when the complainant has sent the legal notice by way of courier. Further, in the absence of any cross- examination of the complainant on the aforesaid aspect, the record which remains unrebutted is the factum of sending of the legal notice by the courier by the complainant. Hence, the presumption of section 114 of the Indian Evidence Act is drawn in the present case in respect of the common course of business being followed when the complainant sent the legal notice by way of courier in the present case at the correct address of the accused within a period of 30 days from the date of the return memo dishonour and the accused has not been able to rebut the said presumption by leading cogent evidence or by producing any material on record. The accused has not been able to rebut the said presumption under section 114 of the Indian Evidence Act.
29. In view of the above discussion, the court is not inclined to agree with the contention of the accused that the present complaint is not maintainable qua the cheque bearing no. 860947 due to non sending of the legal notice by way of registered post within a period of 30 days.
30. Further, non-filing of the tracking report does not vitiate the complaint under Section 138 NI Act. The original courier receipt placed on record which was sent on the correct address and non- challenge of the same by the accused during cross-examination is sufficient to raise a presumption of service under Section 114 of the Indian Evidence Act. Further, even in the absence of a specific date of delivery, it is safe to presume service of legal notice within a reasonable period in the same city (in this case, it is Delhi) in the common course of business unless something is shown to have interrupted the said common course of business. Hence, the contention of the accused is without Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 10 of 21 any merit. Further, it is also an admitted position that the accused had not made any payment before the filing of the present case and as such, first, third, fourth and fifth ingredients are satisfied in the present case.
31. The controversy in the present complaint case pertains to second ingredient.
PRESUMPTIONS UNDER NI ACT
32. As far as the proof of second ingredient is concerned, the complainant is required to prove that the cheque in question was drawn by the drawer for discharging a legally enforceable debt. As per the scheme of the NI Act, once the accused admits signature on the cheque in question, certain presumptions are drawn, which result in shifting of onus on the accused.
33. The combined effect of section 118(a) NI Act and section 139 of the NI Act is that a presumption exists that the cheque was drawn for consideration and given by the accused for the discharge of debt or other liability. In Hiten P. Dalal v. Bratindranath Banerjee (2001) 6 SCC 16), their Lordships of Hon'ble Supreme Court observed as follows:
Because both Sections 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 AR 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" (ibid). Such a presumption is a presumption of law, as distinguished from a presumption of fact which describes provisions by which the court "may presume" a certain state of affairs. Presumptions are rules of evidence and do not conflict with the presumption of innocence, because by the latter all that is meant is that the prosecution is obliged to prove the case against the accused beyond reasonable doubt.
34. In this regard, the Hon'ble Apex Court, having analysed all the concerned provisions in Basalingappa Vs. Mudibasappa, (2019) 5 SCC 418 : 2019 SCC OnLine SC 491 at page 432, came down to the following conclusion:
Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 11 of 21 "25. We having noticed the ratio laid down by this Court in the above cases on Section 118(a) and 139, we now summarise the principles enumerated by this Court in the following manner:
25.1. Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.
25.2. The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities.
25.3. To rebut the presumption, it is open for the accused to rely on evidence led by him or the accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely.
25.4. That it is not necessary for the accused to come in the witness box in support of his defence. Section 139 imposed an evidentiary burden and not a persuasive burden.
25.5. It is not necessary for the accused to come in the witness box to support his defence."
35. Further, it has been held by the Hon'ble Apex Court in Rangappa v. Sri Mohan, (2010) 11 SCC 441 that the presumption contemplated under Section 139 of NI Act includes the presumption of existence of a legally enforceable debt.
36. In order to discharge the aforesaid burden, it has been contended by learned counsel for the accused that there are inherent inconsistencies in the version of the complainant, as listed below, which lead to a probable defence in favour of the accused:
Contention II - The Complainant does not have financial capacity to advance the present loan
37. It is a settled position of law that showcasing that complainant did not have adequate financial capacity to lend money to the accused amounts to a probable defence and can help in rebutting the presumption that is accrued to the benefit of the complainant in cheque dishonour cases. The relevant case laws in this regard have been reproduced hereunder for reference:
(a) In Basalingappa v. Mudibasappa, (2019) 5 SCC 418 : AIR 2019 SC 1983, the Hon'ble Supreme Court has observed as follows:
Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 12 of 21 During his cross-examination, when financial capacity to pay Rs. 6 lakhs to the accused was questioned, there was no satisfactory reply given by the complainant. The evidence on record, thus, is a probable defence on behalf of the accused, which shifted the burden on the complainant to prove his financial capacity and other facts". (emphasis added)
(b) In APS Forex Service Private Limited v. Shakti International Fashion Linkers : AIR 2020 SC 945, the Hon'ble Supreme Court has clarified and explained the issue as follows:
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 . (emphasis added)
(c) The crux of the aforesaid decisions of the Hon'ble Supreme Court has been summarized by the Hon'ble Kerala High Court in Sunitha v. Sheela Antony, 2020 SCC OnLine Ker 1750. In my view, the crux of the decisions referred to above is the following :
"The complainant has no obligation, in all cases under Section 138 of the Act, to prove his financial capacity. But, when the case of the complainant is that he lent money to the Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 13 of 21 accused by cash and that the accused issued the cheque in discharge of the liability, and if the accused challenges the financial capacity of the complainant to advance the money, despite the presumption under Section 139 of the Act, the complainant has the obligation to prove his financial capacity or the source of the money allegedly lent by him to the accused. The complainant has no initial burden to prove his financial capacity or the source of the money. The obligation in that regard would arise only when his capacity or capability to advance the money is challenged by the accused." (emphasis added)
38. It has been held in the case of Kulvinder Singh v. Kafeel Ahmad 2013 SCC OnLine Del 34 of Hon'ble High Court of Delhi as well as K. Prakashan v. P.K. Surenderan 2008 (1) SCC 258 that acquittal is proper on prosecution in complaints under section 138 of NI Act, 1881 where complainant is not able to show the source of friendly loan or solvency for the same. In other words, it was held that presumption of cheques gets dislodged where complainant is not able to give source of the amount loaned to accused.
39. Hon'ble Delhi High Court in Sheela Sharma v. Mahendra Pal 2016 SCC OnLine Del 4696 held that:
"31. In cases where the Complainant claims to have advanced a friendly loan in cash, and where the transaction of loan is not evidenced by any other documentary or other reliable evidence, no doubt, the aspect whether the availability of funds in cash with the Complainant/lender, and its advancement as loan to the Accused have been reflected in the income tax returns of the Complainant/lender, or not, become relevant. If, the availability of funds, and the loan transaction itself is not so reflected, that factor is taken note of by the Court as relevant to hold that the presumption under Section 118 and 139 of the NI Act stands rebutted. However, these considerations would not be relevant, where loan transaction itself is otherwise established, either through documentary evidence such as, a receipt or a loan agreement, or acknowledgement executed by the Accused, or by oral evidence of an independent witness who is found to be credible". (emphasis supplied).
40. The complainant has testified that a loan of Rs. 1,50,000/- was given to the accused in cash and the accused had also admitted the receipt of the loan. However, the accused had stated at notice Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 14 of 21 framing stage that he had taken the aforesaid loan from the wife of the complainant. However, the accused has not done any cross-examination of the complainant on this aspect. Neither any suggestion was given to the complainant that no loan was advanced to the accused by him. DW2, Ms. Savita has also deposed that the loan in the present case was given by the complainant and not by her. Further, the accused himself had admitted the factum of receiving the loan amount from the complainant himself in his section 145(2) NI Act application.
41. It is settled position of the law that the complainant is not under an obligation to prove his financial capacity in the first instance. The obligation on the complainant arises once his financial capacity to extend the loan amount is challenged by the accused. In the present case, the accused himself has admitted receiving the loan amount from the complainant expressly in section 145(2) NI Act application and by necessary implication through the cross-examination of the complainant. In view of the same, the question pertaining to the financial capacity of the complainant does not arise. Further, mere non-indication of the loan amount in the ITR returns does not by ipso facto bars the claim of the complainant. Hence, the the contention of the accused is without any merit.
Contention III: The Accused had already repaid the loan amount to the wife of the complainant vide Ex. A
42. Accused at the notice framing stage states that he had taken a loan in the sum of Rs. 1.5 lakh from Ms. Savita, wife of the complainant and had issued the cheques in question to her and had repaid the entire sum of the loan amount to her in cash and got a receipt of repayment issued from her which is Ex. A. Upon making the repayment of the said amount in cash to her, he had demanded the cheques in question but she said that the cheques in question were lying with the husband and would return the same. Whereas fact of the matter is that on the basis of the cheques in question, the present complaint was instituted by the complainant against the accused and by his own statements in the application u/s 145(2) NI Act.
43. Further, the accused had taken a contradictory stand in the section 145(2) NI Act application wherein he admitted that he and the complainant were family friends and were in good personal terms and used to help each other. Further, in his application, the accused stated that he had Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 15 of 21 contacted the complainant and accordingly took a sum of Rs. 1.5 lakhs from him and later on, upon the persuasion of the complainant, he had issued two postdated cheques in question to the complainant as a security cheque.
44. Further, it was stated by the accused himself in his section 145(2) NI Act application that he had arranged the entire amount payable against both the cheques and had gone to refund the loan amount at the residence of the complainant at Nihal Vihar where the complainant resides. However, upon not finding the complainant at home, he had handed over the loan amount in cash to his wife Ms. Savita Kumar and got an acknowledgement cum receipt of the loan amount repayment issued by her which is Ex. A.
45. It is further claimed by the accused in his 145(2) NI Act application that he had no occasion to ask for receipt from the wife of the complainant, but since the complainant had initiated legal proceedings against him, he had got the same issued as an abundant caution.
46. Perusal of the entire record reveals that the testimony of the complainant regarding the advancement of the loan amount to the accused for an amount of Rs. 1,50,000/- was not challenged by the accused in the cross-examination of the complainant. Neither any suggestion was also given to the complainant regarding the non-advancement of the loan amount by the complainant to the accused. Whereas, the factum of the loan advancement by the complainant is further strengthened by the application of the accused himself under section 145(2) NI Act, wherein he himself had admitted of taking loan from the complainant in cash and at different stages of the trial, the accused had taken a contradictory stand of taking of the loan not from the complainant but from the wife of the complainant. Further, DW2, Ms. Savita also deposed that the loan in question was given by the complainant and not by her. The stand of the accused that the loan was not taken from the complainant but from the wife of the accused is not grounded in the factual position so established and does not inspire the confidence of the court.
47. Further, the entire defense of the accused hinges on the fact that he had already repaid the entire loan amount to the complainant and the same has been done by him by making payment to the wife of the complainant in cash at the residence of the complainant in Nihal Vihar (as mentioned in Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 16 of 21 145(2) application so moved on behalf of the accused. In the cross-examination of the accused, a specific question was put to him regarding the source of money for the repayment of the loan amount as claimed by him to which the accused stated that some of the amount used for repayment of the aforesaid loan amount was also withdrawn from the bank account. Upon specifically asking about the production of the bank account statement, the accused refused to produce the same. The relevant excerpts of the cross-examination is as follows: -
"...
Q.1 As you stated in your statement that on October 25, 2014, you have returned the amount to the complainant. Have you withdrawn the said amount from your account and bank? Ans. I do not remember. Vol. Some amount have been withdrawn from my account. Q.2 Can you bring the statement of account in respect of the above mentioned statement that you have withdrawn the amount from your own account?
Ans. No ..."
48. Even if version of the accused is assumed to be true at its face value, the court fails to understand the reason for the non-production of the bank account statement from which the said amount was withdrawn for the repayment of loan. This could have supported the stand of the accused amongst other things. In the absence of any credible proof of the loan repayment by the accused, the court is not inclined to accept the version of the accused as true and considers it to be a mere afterthought in order to avoid the liability towards the complainant.
49. Acknowledgment receipt Ex. A has been tendered in evidence by the accused and on the basis of the same, the accused claimed that he had already cleared his liability to the complainant by making the payment of the loan amount to the wife of the accused. However, the examination in chief of the accused is silent on the aspect of the place where such payment is stated to be made and the acknowledgement receipt, when and where it was allegedly given to the accused by the wife of the complainant, whereas, in the application under section 145(2) NI Act, accused had specifically stated the same that loan repayment was made at the house of the complainant in Nihar Vihar in his absence.
Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 17 of 21
50. In this respect, firstly, the court fails to understand that when the accused was well aware of the proceedings of the present case in the court, then why did he choose to make the payment to the wife of the complainant and not to the complainant despite the fact the loan was taken from the complainant and not from the wife of the complainant.
51. Secondly, the court fails to understand as to why the payment was made outside the court and not in the presence of the court. Further, accused chose to make the payment in cash in place of proper banking channels which shall have documentary proof. Further, the accused had not even produced the bank account statement from which the said money was stated to be withdrawn by him to make the payment. Neither the payment of the loan amount was made in the presence of any independent witness which will vouch for the fact of the repayment of the loan amount in cash. A reasonable prudent man would not act in a way in which the accused had acted despite the factum of pending criminal proceedings against him by the complainant.
52. In the 145(2) NI Act application, the accused had taken a plea that he had gone to the house of the complainant in Nihal Vihar to return the loan payment in cash and the accused had not stated any such fact in his examination in chief before the court, however, he stated the exact date of the repayment i.e. October 25, 2014 and when the DW2 stepped into the witness box, she specifically stated that the accused had never visited my house in the year 2014. No such questions were put to DW2 even in her re-examination by the accused regarding the deposition that the accused had not visited the house of the complainant in Nihal Vihar in the year 2014.
53. Further, the accused in his section 145(2) NI Act application had stated that the son of the complainant was also present at the time of repayment of the loan amount in question to the wife of the complainant at his house. It was also stated in the said application that the son of the complainant was quite educated to understand the same. However, at no stage of the trial, neither at the stage of notice framing nor at the stage of DE, it has been stated by the accused and neither the said witness is stated to be included in the list of witnesses sought to be examined on behalf of the accused. The court fails to understand the same as to why the witness was not even mentioned.
Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 18 of 21 Further, no question was put to DW2 also in her examination in chief or in her re-examination regarding the same fact.
54. Further, it is an admitted position that the Ex. A is in the handwriting of the accused and the accused himself admitted the same during the course of the trial and had stated that at the time of repayment of the loan amount to the wife of the complainant, he had got an acknowledgement receipt issued by the wife of the complainant. The wife has admitted the signatures on the said receipt, however, has denied the contents of the same receipt and stated that the blank signed paper was given by her to the accused for the purposes of availing leave in case of surprise inspection of attendance in her office. Accused on the other hand has examined DW3 who has stated that there is no such rule which allows the employees to avail leave like this and this was not even an authorized channel to avail the leave as per the official rules. On the basis of the same, the accused contends that the burden to prove the fact that payment has not been made is on the complainant and not on the accused because accused had produced a receipt of payment which is issued allegedly by the wife of the complainant and wife of the complainant has also admitted the signature on the said receipt. Further, it is contended on behalf of the accused that as per the presumption of section 114 relating to human conduct, burden is now on the complainant to prove the factum of non-payment.
55. This court finds it unable to agree with the submission of the accused that burden is on the complainant to prove the fact of non-payment. The complainant in the present case has clearly stated that the loan amount was given to the accused in cash and the accused has also admitted the receipt of the same from. Further, the accused had also admitted the issuance of the cheques in question to the complainant in furtherance of the discharge of the legally enforceable liability and it is the admitted position on behalf of the accused that he had filled all the particulars of the cheques in question. Further, the accused had nowhere indicated the factum of payment to the complainant and had not satisfactorily explained the circumstance as to why the payment was made to the wife of the complainant and that too in the absence of the complainant. Further, even if assuming for the sake of the argument that the wife of the complainant received the payment from the accused then also, the accused had not established anywhere that the wife of the complainant was even authorized to accept the payment on behalf of the complainant. The cross-
Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 19 of 21 examination of the complainant is also silent on the aspect of factum of non-advancement of the loan by him, which is claimed by the accused at later stages of the trial. Further, the accused himself admitted in his 145(2) NI Act application that he had taken the loan amount from the complainant as he had good relations with the complainant.
56. Also, if one reads the contents of the Ex. A carefully, it is noted that the accused in its 145(2) NI Act application had taken a stand that he had gone to the house of the complainant in Nihal Vihar to hand over the money, whereas, it is also an admitted position on behalf of the accused that he had himself written the contents of the Ex. A. In the contents of the said exhibit, the accused himself stated the address of the wife of the complainant as that of Mangolpuri and not Nihal Vihar and the court fails to understand the reasons for the same. When on one hand accused himself is writing the acknowledgement receipt in his own handwriting at the house of the complainant in Nihar Vihar, why would accused mention the address of the wife of the complainant as that of Mangolpuri.
57. Considering the above discussion, the court does not find the acknowledgement receipt Ex. A as worthy of any credibility. The question of raising of the presumption against the complainant u/s 114 Indian Evidence Act arises when the foundational facts are established or shown to have exist by relying upon the circumstances of the case, however, in the present case, the said foundational touchstone has not been met by the accused.
58. In view of the above discussion, hence, the mere stand of the accused that he had made the repayment of the loan amount to the wife of the complainant in cash in October 2014 and the acknowledgement receipt Ex. A was issued by the wife of the complainant does not inspire the confidence of the court and it appears to be a mere afterthought in order to avoid his legal liability.
59. The conduct of the accused is not in line that of the standard expected from the reasonable man and appears to be highly improbable. The plea of the accused is marred with serious contradictions and is inherently improbable.
Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 20 of 21 Conclusion
60. In conclusion, I am of the view that accused has not been able to raise probable defence in the present case.
61. Accordingly, in light of the scheme of the NI Act, a statutory presumption exists in favour of the complainant. The statutory presumption cannot be rebutted in such a casual manner. There must be something concrete on record to rebut the same.
62. Hence, in view of the discussion in the foregoing paragraphs, the inevitable conclusion is that the accused has failed to rebut the onus put on him by virtue of the presumptions enshrined in Section 118 and 139 of the NI Act. Therefore, the second ingredient also stands proved against the accused.
63. To recapitulate the above discussion, the complainant has been successful in establishing his case beyond reasonable doubt that the accused had issued the cheque in question in discharge of his legally enforceable liability. The presumptions under Section 118 and Section 139 of NI Act were drawn against the accused. The accused has miserably failed to rebut the said presumption by raising a probable defence.
64. Resultantly, the complaint of the complainant is allowed and the accused, Sh. Narinder Chaudhary is hereby convicted of the offence under Section 138 of the Negotiable Instruments Act, 1881. Let the convicted person be heard separately on quantum of sentence.
65. A copy of this judgment be given free of cost to the convict.
66. This judgment bears 21 pages and each page bears my signatures. Judgment be uploaded on the website forthwith.
Digitally signedPronounced in open court. by SHUBHAM
SHUBHAM GUPTA
ORDER :- Convicted GUPTA Date:
Date: 29.07.2025. 2025.07.29
18:45:55 +0530
(SHUBHAM GUPTA)
JMFC(N.I.Act)Digital Court-01/
SouthWest District, Dwarka Court
29.07.2025
Abhimanyu Malakar Vs. Nariinder Kumar Chaudhary Page No. 21 of 21