Delhi District Court
Bhayana Builders Pvt. Ltd vs Akashdeep Singh on 30 August, 2025
CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh
IN THE COURT OF JUDICIAL MAGISTRATE FIRST CLASS
(NI ACT-02), SOUTH EAST DISTRICT, SAKET COURT COMPLEX,
NEW DELHI
(Presided over by Ms. Shruti Sharma-I)
DLSE020020732013
CT CASES/622707/2016
BHAYANA BUILDERS PVT. LTD. .................. Complainant
Vs.
AKASHDEEP SINGH ................... Accused
Sr. No Particulars Details
A. Name and address of the Bhayana Builders Private Limited through its
Complainant: AR office at 7, Factory Road, Near Safdarjung
Hospital, New Delhi 110029
B. Name and address of the Sh. Akashdeep Singh, S/o Brijmohan Singh,
Accused. R/o C-501, Beta-1, Greater Noida, Uttar
Pradesh - 201301.
C. Offence complained of U/s 138 NI Act
D. Plea of the accused Pleaded not guilty.
E. Final order Conviction.
F. Date of institution 02.01.2013
G. Date of pronouncement 30.08.2025
Digitally
signed by
SHRUTI
SHRUTI SHARMA
SHARMA Date:
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JUDGMENT
Brief facts and reasons for decision of the case
1. By way of the present judgment, this Court proceeds to adjudicate upon and dispose of the criminal complaint instituted by Bhayana Builders Private Limited (hereinafter referred to as "the complainant"), having its registered office at 7, Factory Road, Near Safdarjung Hospital, New Delhi, against Mr. Akashdeep Singh (hereinafter referred to as "the accused"), residing at C-501, Beta-1, Greater Noida, Uttar Pradesh, for the alleged commission of an offence punishable under Section 138, read with Section 142, of the Negotiable Instruments Act, 1881 (hereinafter referred to as "the NI Act"). The complaint arises from the dishonour of cheque bearing No. 008647 dated 17.11.2012 for an amount of ₹80,000/- (Rupees Eighty Thousand Only) drawn on ICICI Bank, Vasant Kunj (Square Mall) Branch, New Delhi, which, upon presentation, was returned unpaid due to insufficiency of funds, as envisaged under Section 138 of the NI Act.
2. The complainant has alleged that the accused, Mr. Akashdeep Singh, was employed as a Project Manager in Bhayana Builders Private Limited, a reputed construction company having its registered office at 7, Factory Road, Near Safdarjung Hospital, New Delhi. The accused had approached the complainant company for a loan of Rs. 8,00,000 (Rupees Eight Lakhs) on 25.05.2011, which was sanctioned in good faith for the purpose of purchasing a house. It was agreed between the parties that the loan would be repaid in ten quarterly installments of Rs. 80,000 each with interest at 12% per annum. As security for the loan, the accused issued ten post-dated cheques, including cheque No. 008647 dated Digitally signed by SHRUTI SHRUTI SHARMA SHARMA Date:
2025.08.30 16:48:51 +0530 Page no. 2/30 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh 17.11.2012 for Rs. 80,000 drawn on ICICI Bank, Vasant Kunj Branch, New Delhi.
3. It has been further averred that when the complainant, Bhayana Builders Private Limited, presented the cheque bearing no. 008647 dated 17.11.2012 for encashment through its banker, Indian Overseas Bank, Defence Colony, New Delhi, the cheque was returned unpaid by the drawee bank, ICICI Bank, Vasant Kunj Branch, with the specific endorsement "Funds Insufficient" vide return memo dated 22.11.2012. The dishonour of the cheque on the ground of insufficiency of funds in the account of the accused, despite his prior assurances and issuance of the cheque in discharge of a pre-existing liability, led the complainant to reasonably presume that the accused had issued the said cheque without ensuring the maintenance of an adequate balance in his account and without any genuine intention to honour his financial obligation.
4. This act, according to the complainant, amounted to a wilful attempt on the part of the accused to deceive and defraud the complainant under the guise of repayment. Complainant asserted that the accused has failed to exhibit any bona fide intent to amicably resolve the matter or to make good the payment. Despite repeated earnest efforts made by the complainant to secure the repayment, the accused persistently refrained from engaging in any meaningful communication, while deliberately deflecting responsibility. Such evasive conduct, as alleged by the complainant, was not merely indicative of indifference but amounted to a conscious and wilful default, reflecting a deliberate intention on the part of the accused to avoid discharging his lawful and enforceable debt.
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5. Thereafter, in accordance with the statutory requirements under Section 138 of the Negotiable Instruments Act, 1881, the complainant, Bhayana Builders Private Limited, issued a legal demand notice dated 24.11.2012 to the accused, Mr. Akashdeep Singh, calling upon him to pay the amount of Rs. 80,000/- along with incidental and legal charges within fifteen days from the date of receipt of the notice. The legal notice was duly served on the accused at his address and he even replied to the same. Despite the receipt of the legal demand notice and the opportunity to comply, the accused failed to make the payment within the stipulated period. Facing persistent default and evasive conduct by the accused, the complainant was left with no option but to initiate criminal proceedings by filing the present complaint under Sections 138 and 142 of the Negotiable Instruments Act, 1881, for the dishonour of cheque and to enforce the repayment of the loan amount.
6. This deliberate and continued default on the part of the accused, coupled with the dishonour of the cheque on the specific ground of "Funds Insufficient," has led the complainant to reasonably infer that the accused never harboured any genuine intention to honour his financial obligations from the very inception of the transaction. The complainant has thus asserted that the issuance of the cheque in question was not a bona fide attempt at repayment but a calculated and deceitful act, orchestrated to induce a false sense of assurance while knowingly lacking the means or intent to fulfil the liability. Such conduct, as alleged, amounts to a dishonest inducement and constitutes a deliberate abuse of the negotiable instrument. In view of these circumstances, the complainant contends that the acts and omissions of the accused squarely Digitally signed by SHRUTI SHARMA SHRUTI Date:
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attract the penal consequences envisaged under Section 138 of the Negotiable Instruments Act, 1881, thereby warranting criminal liability.
7. Upon careful consideration of the averments made in the complaint, the supporting documents filed therewith, and the pre-summoning evidence tendered by the complainant via affidavit in compliance with procedural requirements, this Court was of the considered view that sufficient prima facie grounds existed to proceed against the accused, Mr. Akashdeep Singh, for the commission of an offence punishable under Section 138 of the Negotiable Instruments Act, 1881. The complainant had, at the pre-summoning stage, duly proved the issuance, dishonour, and service of statutory demand notice in respect of the cheques in question. Accordingly, being satisfied that all foundational ingredients of the alleged offense were duly disclosed, this Court, vide order dated 19.01.2013, directed that the accused be summoned to face trial for the dishonour of cheque bearing No. 008647 dated 17.11.2012, alleged to have been issued in discharge of a legally enforceable debt or liability, as contemplated under the scheme of the NI Act
8. The accused entered appearance on 16.04.2013 and was subsequently admitted to bail. He furnished the requisite personal bond and surety bonds on subsequent dates of hearing, which were duly accepted by this Court. Thereafter, upon consideration of the material available on record and being satisfied that a prima facie case existed warranting the commencement of trial, this Court proceeded to frame notice under Section 251 of the Code of Criminal Procedure, 1973. The notice was duly served upon the accused, who, upon being apprised of the substance of the accusation--including specific allegations regarding the issuance and dishonour of the cheque in question--pleaded not guilty Digitally signed by SHRUTI SHRUTI SHARMA Page no. 5/30 SHARMA Date:
2025.08.30 16:48:58 +0530 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh and claimed trial, thereby necessitating the recording of evidence in accordance with law.
9. In support of its case, the complainant examined CW 1 who entered the witness box with the following documents in support of his case:-
Sr. No. Exhibits Particulars
1. Ex.CW-1/I Evidence by way of Affidavit.
2. Ex.CW-1/A Copy of Board Resolution 06.09.2012.
3. Ex.CW-1/B Copy of Termination letter dated
05.03.2012.
4. Ex.CW-1/C Copy of Account statement of
complainant
5. Ex.CW-1/D Original cheque bearing no. 008647
dated 17.11.2012 for Rs. 80,000/-.
6. Ex.CW-1/E Cheque Return Memo dated
22.11.2012 with remarks "Funds
Insufficient".
7. Ex.CW-1/F Legal notice dated 24.11.2012
8. Ex.CW-1/G Postal Receipts of registered AD.
9. Ex.CW-1/H Receipt of delivery of registered AD.
10. Ex.CW-1/J Copy of loan agreement dated
05.03.2012.
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SHRUTI Date:
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10. The same was followed by extensive cross-examination of CW-1 conducted on behalf of the accused. Thereafter, CW 2, a bank official, was examined on behalf of the complainant. CW 2 had relied on the following documents:-
Sr. No. Exhibits Particulars
1 Ex.CW-2/1 Statement of account dated
25.05.2011.
2 Ex.CW-2/2 Attested copy of cheque bearing no.
091176 dated 23.05.2011 of Rs.
8,00,000/-
11. Upon completion of the said cross-examination, witness was discharged and the complainant evidence was closed on 18.10.2016.
12. As the complainant did not wish to examine any other witness, the matter wad fixed for recording of statement of accused u/s 313 CrPC and subsequent to the conclusion of the complainant's evidence, and in compliance with the procedural mandate under Section 313 of the Code of Criminal Procedure, 1973, the statement of the accused was recorded by the Court on 16.11.2016 thereby affording him an opportunity to personally explain the incriminating circumstances appearing against him in the prosecution evidence.
13. During his examination under Section 313 of the Code of Criminal Procedure, 1973, the accused, Mr. Akashdeep Singh, denied any liability under Section 138 of the Negotiable Instruments Act. He did not acknowledge that the complainant company, Bhayana Builders Pvt. Ltd., Digitally signed by SHRUTI SHARMA SHRUTI Date:
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had sanctioned a loan of Rs. 8,00,000/- in his favour on 25.05.2011 for the purpose of purchasing a house, stipulating that the repayment would be made in ten quarterly installments of Rs. 80,000/- each with interest at 12% per annum. Furthermore, he failed to admit that, as part of the loan arrangement, he had issued ten post-dated cheques--including cheque no. 008647 dated 17.11.2012 for Rs. 80,000/---drawn on ICICI Bank, Vasant Kunj, New Delhi, as security for the repayment of the loan amount to the complainant. He claimed, contrary to the complainant's assertions, that his signatures were forcibly obtained on the loan agreement and the ten cheques on the day his employment was terminated. He asserted that he never received any loan from the complainant and that the payment of Rs. 8,00,000/- received in his account was towards incentives earned in the course of his employment, rather than as a loan. He claimed to have received the legal notice and admitted having issued a reply to the same.
14. An application u/s 315 CrPC was moved on behalf of the accued where the accused wished to examine himself as DW-1 in order to substantiate his stand. In this application, the accused sought permission to appear as a defense witness in his case. He submitted that as per the complaint, he had allegedly taken a house building advance loan of ₹8,00,000 under a loan agreement dated 05.03.2012 and, in this regard, deposited ten cheques with the complainant company, including the cheque in question. However, he argued that although the loan agreement was executed on 05.03.2012, the complainant company never disbursed the loan amount to him either on the date of agreement or thereafter, yet it retained the said cheques. On these grounds, the accused wished to testify in his own defense to establish that no actual loan was Digitally signed by SHRUTI SHRUTI SHARMA Page no. 8/30 SHARMA Date:
2025.08.30 16:49:05 +0530 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh provided, and hence the cheque(s) in dispute cannot be treated as issued towards any legally enforceable liability. Final arguments
15. This Court heard the final arguments on behalf of both the parties on 20.08.2025.
16. Learned counsel for the complainant vehemently argued that that the accused was duly employed with Bhayana Builders Pvt. Ltd. and had received a loan of Rs. 8,00,000/- on 25.05.2011 through proper banking channels, a fact not disputed by the accused except for the purpose of the amount. It was contended that the dishonored cheque bearing No. 8647 dated 17.11.2012 for Rs. 80,000/- was issued by the accused against this loan and its signature and delivery were admitted by him, negating any claim that the cheque was obtained by coercion.
17. The learned counsel submitted that the loan agreement dated 05.03.2012, exhibited as CW1/J, is a valid document forming the basis of the legally enforceable debt, and no credible evidence was produced by the accused to suggest otherwise.
18. It was further argued that the accused's defense--that the Rs. 8 lakhs received was an incentive and that the loan documents and cheque were signed under duress--lacked any cogent proof and was contradicted by facts such as non-receipt of Form 16 by the accused, and the omission of the amount in his income tax return.
19. Ld. counsel highlighted that only the accused's uncorroborated statement supports these defense claims, without any substantive evidence to rebut the statutory presumption under Section 139 of the Negotiable Instruments Act favoring the complainant.
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20. The complainant also relied on the dismissal of the accused's civil suit for cancellation of the loan agreement and the quashing of his criminal case, emphasizing that these judicial decisions reinforce the authenticity and enforceability of the loan and payment obligation.
21. It was submitted that the accused failed to produce any concrete evidence of coercion or forgery, and the loan amount credited to his account substantiates the existence of a legally enforceable debt, justifying conviction under the NI Act
22. Finally, the complainant urged that the defense's claim of incentive was negated by the absence of any communication or precedent for such payment to any other employee, making the defense untenable and warranting conviction.
23. Per contra, Ld. counsel for the defence argued that the complaint filed by the complainant company is based on false, fabricated, and concocted allegations, and therefore, the accused is entitled to be acquitted .
24. It was submitted that the accused was employed as a Billing Engineer, received regular promotions, and salary increments up to Rs. 74,350 per month, demonstrating his honesty and diligence in work. The defence contended that the accused was assured orally in of an incentive upon completion of a project at Dharampal Satyapal Factory (D.S. Group), amounting to approximately 4% of the enhanced project cost (around Rs. 3 Crore), and also had a claim for unpaid loyalty bonus for three months, none of which were paid by the complainant company.
25. It was argued that on 05.03.2012, the accused was called to the company's office, locked in a room, and coerced to sign several Digitally signed by SHRUTI SHRUTI SHARMA SHARMA Date:
2025.08.30 16:49:10 Page no. 10/30 +0530 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh documents, including the loan agreement and cheques, which he signed under duress and threat, negating the complainant's assertion of voluntary execution. The defence pointed out that the accused had filed complaints and suit against the company directors, alleging threats and coercion, and that the criminal FIR against the directors was quashed on jurisdictional grounds, establishing the mala fide intentions of the complainant company. It was further argued that the loan agreement was allegedly created and attested long after the accused's termination and under suspicious circumstances, indicating fabrication by the complainant to substantiate a false case.
26. The defence emphasized that the accused never received the alleged loan on 05.03.2012 and that the Rs. 8 lakhs credited on 25.05.2011 was in fact part of an incentive, not a loan, which was neither reflected properly by the complainant company in tax documents nor communicated officially. It was also submitted that the complainant company violated its responsibilities by withholding salaries, bonuses, and benefits owed to the accused, highlighting the company's default and malafide conduct.
27. Learned defence counsel argued that the presumption under Section 139 of the NI Act is rebuttable, and the standard required is that of preponderance of probabilities, not proof beyond reasonable doubt. It was submitted that the accused had discharged this burden by offering a plausible explanation regarding the cheque being given as security and by raising serious doubts about the complainant's intent and conduct.
28. The defence concluded that no legally enforceable debt exists as claimed by the complainant, the cheque was obtained under coercion, Digitally signed by SHRUTI SHRUTI SHARMA Page no. 11/30 SHARMA Date:
2025.08.30 16:49:12 +0530 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh and thus the accused is not liable under the NI Act provisions. The accused's suit for cancellation was dismissed but did not validate the alleged loan. Hence, the defence prayed for acquittal of the accused in the interest of justice based on these grounds Legal Analysis & Findings :-
29. I have heard at length the detailed arguments advanced by the learned counsels for both the complainant and the accused. The submissions have been carefully considered in light of the factual matrix and the legal principles applicable to the case. This Court has also undertaken a thorough and meticulous examination of the entire record, including the contents of the complaint, the affidavits and documents annexed therewith, the oral depositions of the prosecution and defence witnesses recorded during the trial, and the exhibits relied upon by both sides. Each piece of evidence has been scrutinized independently as well as cumulatively to assess its evidentiary value and probative force. The rival contentions have been weighed objectively in the backdrop of the statutory provisions and the settled law governing cases under Section 138 of the Negotiable Instruments Act, 1881. The Court has thus endeavored to arrive at a well-reasoned and just conclusion based on a holistic appreciation of the material on record.
30. Before embarking upon a discussion on the merits of the present case, it is considered apposite to first set out the legal framework governing the offence of dishonour of cheque, as encapsulated under Section 138 of the Negotiable Instruments Act, 1881. The said provision was introduced with the object of enhancing the credibility of negotiable instruments in commercial transactions and ensuring greater financial Digitally signed by SHRUTI SHRUTI SHARMA SHARMA Date:
2025.08.30 Page no. 12/30 16:49:15 +0530 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh discipline by attaching penal consequences to the issuance of cheques that are dishonoured on presentation for insufficiency of funds or if the amount exceeds the arrangement made with the banker
31. In order to fasten criminal liability upon an accused under Section 138 of the Negotiable Instruments Act, 1881, it is incumbent upon the complainant to establish, through the averments made in the complaint and the evidence led during trial, the existence of the following essential ingredients:
a) That the accused must have drawn a cheque on an account main-
tained by him with a banker, for payment of a certain sum of money to another person, and such payment must be towards the discharge, in whole or in part, of any legally enforceable debt or other liability;
b) That the said cheque must have been presented to the bank within a period of three months from the date on which it was drawn, or within the period of its validity, whichever is earlier;
c) That upon such presentation, the cheque must have been returned unpaid by the bank, either due to insufficiency of funds in the drawer's account or because the amount exceeds the arrangement made by the drawer with the bank;
d) That the payee or the holder in due course of the cheque must have issued a statutory demand notice in writing to the drawer, seeking payment of the cheque amount, within 30 days from the date of re- ceipt of information from the bank regarding the return of the cheque as unpaid;
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e) That the drawer of the cheque, despite receipt of the said legal no- tice, failed to make payment of the cheque amount to the payee or holder in due course within 15 days of such receipt.
32. It is also pertinent to note that, as per the Explanation appended to Section 138, the expression "debt or other liability" refers only to a legally enforceable debt or other liability. Thus, the dishonoured cheque must have been issued against a subsisting and enforceable obligation under the law.
33. It is well-settled that the aforementioned ingredients must co-exist and be satisfied cumulatively in order to constitute the offence under Section 138 of the Negotiable Instruments Act, 1881. The absence or non-fulfillment of even one of these statutory requirements would disen- title the complainant from invoking penal liability against the drawer of the cheque. Thus, only when all the conditions--namely, the issuance of the cheque in discharge of a legally enforceable debt or liability, its pre- sentation within the stipulated period, dishonour by the bank, issuance of a valid legal demand notice within the prescribed time frame, and the failure of the drawer to make payment within 15 days of receipt of the said notice--are conclusively established through evidence, can the of- fence under Section 138 be deemed to have been committed.
34. In his examination-in-chief, CW 1, Sh. Rahul Bhayana, representing Bhayana Builders Pvt. Ltd., stated that the complainant company is a re- puted construction firm operating under the Companies Act, 1956. He explained that Akashdeep Singh, the accused, was employed as a Project Manager at the company but was terminated on 5th March 2012 due to Digitally signed by SHRUTI SHARMA SHRUTI Date:
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irregularities related to labor and material management, which were con- firmed by an independent investigation. Rahul Bhayana stated that the company had sanctioned a loan of Rs. 8,00,000 to the accused on 25th May 2011 for the purpose of purchasing a house, with the repayment to be made in ten quarterly installments of Rs. 80,000 each, along with in- terest at 12% per annum. The accused had handed over ten post-dated cheques, numbered 008645 to 008654, drawn on ICICI Bank, as security for this loan. The accused assured that the cheques would be honored on presentation, and the complainant relied on this assurance. Rahul Bhayana further testified that the accused issued cheque number 008647, dated 17th November 2012, for Rs. 80,000 as the third installment, which was presented to Indian Overseas Bank, Defence Colony branch, for encashment. However, to the complainant's surprise, the cheque was dishonored due to insufficient funds, as evidenced by the bank's return memo dated 22nd November 2012. He also noted that this was not the first instance of dishonor; the first two installment cheques were also re- turned unpaid on earlier dates--22nd March 2012 and 3rd September 2012--due to lack of funds. Rahul Bhayana underscored that despite le- gal demand notices served upon the accused, he failed to make the pay- ment within the stipulated time, thereby committing an offence under Section 138 of the Negotiable Instruments Act. The evidence and docu- ments submitted by the complainant, including the loan agreement and bank communication, were affirmed as true and correct by Rahul Bhayana in his affidavit before the court.
35. In his cross-examination, it was brought out that Mr. Rahul Bhayana was not fully aware of all the internal processes regarding the loan and Digitally signed by SHRUTI SHRUTI SHARMA SHARMA Date:
2025.08.30 16:49:21 +0530 Page no. 15/30 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh the employment status of the accused, Akashdeep Singh. He admitted that the accused was suspended on 5th March 2012 and terminated later on 9th March 2012, and denied any suggestion that termination occurred on 5th March. Rahul Bhayana acknowledged that the loan was sanc- tioned in good faith on 25th May 2011 as the accused was a trusted em- ployee. However, he was uncertain about who purchased the stamp paper or the exact execution date of the loan agreement document (Ex. CW1/J) but admitted it was attested by a Notary/Oath Commissioner. He refuted the claims that the document was forged or that the accused was forced to sign it while confined. When questioned about the cheque and loan transaction, he affirmed the loan amount was disbursed to the accused through a cheque, and that the cheque details were mentioned in the statement of account (Ex. CW1/C). However, it was noted that the state- ment of account was inadmissible due to lack of a certificate under Sec- tion 65-B of the Evidence Act. Rahul Bhayana denied knowledge of any complaint lodged by the accused against the complainant company and refuted suggestions that the accused was threatened or abused leading to his departure from Delhi. He stated no other loan except the Rs. 8 lakh was sanctioned to the accused and was unaware if smaller loans were de- ducted from the accused's salary. Further, he denied that the complainant company issued the Rs. 8 lakh as an incentive (suggesting it was a loan), and stated that arrears of salary or incentives due to the accused were not known to him. He also denied that the complainant company filed a false case to evade liabilities to the accused or that the accused was entitled to Rs. 17.5 lakh from the company. Rahul Bhayana admitted that bonuses were included within the structured salary and could not comment on other employee benefits like medical facilities, leave encashment, trans-Digitally signed by SHRUTI
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port convenience, loyalty bonus, or gratuity, as these were part of the cost to company structure. Finally, he rejected allegations of filing a false case under Section 138 of the NI Act to evade liabilities and denied giving false evidence in court.
36. CW2, Ms. Kritika Gupta, Assistant Manager at Indian Overseas Bank, Defence Colony branch, New Delhi, appeared as a witness and produced the summoned records relating to account number 011502000003856 for the date 25.05.2011. She confirmed that the records were duly supported by a certificate under the Banker's Book Ev- idence Act, thereby authenticating their legal admissibility. Ms. Gupta also brought on record the bank statement, marked as Ex. CW2/1, as well as a photocopy of cheque number 091176 dated 23.05.2011 for Rs. 8 lakhs issued in favour of Mr. Akash Deep Singh, marked as Ex. CW2/2. Her testimony confirmed the factum of the transaction and the issuance of the cheque to the accused. Notably, during cross-examina- tion, the defence did not put any questions to her, and thus her evidence remained entirely unchallenged and unrebutted on the record.
37. It is also of considerable significance that the accused has, at every stage of the proceedings, consistently admitted his signatures on the cheque in question, as well as the factum of its issuance in favour of the complainant. He has further acknowledged receipt of the statutory de- mand notice and even admitted to filing a reply thereto. During the course of cross-examination and at the stage of admission/denial under Section 294 Cr.P.C., the accused did not dispute the genuineness of his signatures, the presentation of the cheque, the dishonour memo, or the service of the legal notice. These admissions, being unequivocal, leave Digitally signed by SHRUTI SHRUTI SHARMA SHARMA Date:
2025.08.30 16:49:26 Page no. 17/30 +0530 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh no room for doubt as to the execution of the cheque and the compliance with statutory requirements under Section 138 NI Act.
38. Insofar as the above mentioned ingredients (b), (c), (d), and (e) are concerned--namely, the presentation of the cheque within the prescribed period, its dishonour by the bank due to insufficiency of funds, the is- suance of a legal demand notice within 30 days of intimation of dishon- our, and the failure of the drawer to make payment within 15 days of re- ceipt of such notice--all seem to have been duly proved by the com- plainant. The said facts stand duly substantiated by the documentary evi- dence placed on record, including the cheque, the return memo, copy of the legal demand notice, courier/postal receipts evidencing dispatch indi- cating service of notice upon the accused.
39. It is also not in dispute that the accused failed to make payment of the cheque amount to the complainant within the statutory period of 15 days from the date of receipt of the legal demand notice. The record re- flects that the legal notice was duly served upon the accused as the ac- cused duly replied to the said legal notice and despite the opportunity af- forded under the mandate of Section 138 of the NI Act, no payment was made within the prescribed period.
40. The Court shall now proceed to examine the most crucial ingredient under Section 138 of the Negotiable Instruments Act, 1881, which con- stitutes the core issue in controversy in the present case--whether the impugned cheque was issued by the accused (drawer) in discharge of a legally enforceable debt or other liability. This aspect is of paramount importance, as the existence of such liability is the very foundation upon Digitally signed by SHRUTI SHRUTI SHARMA SHARMA Date:
2025.08.30 16:49:29 +0530 Page no. 18/30 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh which the statutory presumption under Section 139 of the NI Act rests. The complainant must prima facie demonstrate that the cheque was is- sued in respect of a subsisting and legally enforceable obligation. The ac- cused, on the other hand, may rebut this presumption either by leading direct evidence or by eliciting material inconsistencies or improbabilities in the complainant's case during cross-examination, thereby raising a reasonable doubt as to the existence of such liability. Thus, this Court now undertakes a detailed examination of the rival contentions and the evidence on record to determine whether the said ingredient stands proved to the requisite standard in the present matter.
41. Once foundational facts are admitted, it is a well-settled position of law that when a negotiable instrument is drawn, two statutory presump- tions arise in favour of the complainant, one under Section 139 NI Act and another under Section 118(a) of the NI Act, which is a presumption of the cheque having been issued in discharge of legal liability and drawn for good consideration. Section 118(a) of the N.I Act and Section 139 NI Act are reproduced for ready reference:
Section 118 NI Act provides:
"Presumptions as to negotiable instruments": "Until the contrary is proved, the following presumptions shall be made:
(a) of consideration - 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;
Section 139 of the NI Act further provides as follows:
"Presumption in favour of holder - It shall be presumed, unless the contrary is proved, that the holder of a cheque Digitally signed by SHRUTI SHRUTI SHARMA Date:
SHARMA 2025.08.30 16:49:31 +0530 Page no. 19/30 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh received the cheque of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability"
42. Hence, in light of the aforesaid statutory provisions, particularly Sections 118(a) and 139 of the Negotiable Instruments Act, it is manifest that once the complainant successfully establishes the foundational facts-- namely, the execution and issuance of the cheque by the accused--the Court is bound to raise a presumption that the said cheque was drawn for consideration and in discharge of a legally enforceable debt or liability. This presumption is a rebuttable one; however, the initial evidentiary burden lies squarely upon the accused to rebut the same by raising a probable defence. Such rebuttal need not be proved beyond reasonable doubt, but must be sufficient to create a preponderance of probability in favour of the accused. Unless such a rebuttal is successfully established by the accused through direct evidence or material inconsistencies in the complainant's version, the presumption under law continues to operate in favour of the complainant.
43. This is an example of the rule of 'reverse onus' in action, where it is an obligation on the accused to lead what can be called 'negative evidence'. The accused is not to prove a fact affirmatively, but to lead evidence to demonstrate the non-existence of debt or liability. Since, this rule is against the general principle of the criminal law of 'presumption of innocence in favour of the accused' and considering that such negative evidence, by character is difficult to lead, the threshold for the accused to rebut the presumption is on the scale of the preponderance of probabilities. This was held in 'Sangappa v. Sri Mohan'[(2010) 11 SCC 441], this means that the lack of consideration or a legally enforceable debt is not to be proved beyond all reasonable doubt.
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44. The accused is required to either prove the non-existence of the liability or the existence of it so improbable that a prudent man would think that it does not exist. The accused can do this either by leading direct or relying upon circumstantial evidence in his defence. Alternatively, the accused can punch holes within the case of the complainant by way of cross- examination. Thereafter, the onus of proof shifts back to the complainant, and the presumptions under Sections 118 and 139 of the Act, will not again come to the complainant's rescue.
45. In the light of the foregoing statutory provisions and the settled principles of law governing the presumptions under Sections 118 and 139 of the Negotiable Instruments Act, this Court shall now proceed to scrutinize the defence set up by the accused. The primary question that arises for consideration at this stage is whether the defence raised by the accused is a plausible, probable, and legally tenable one--capable of rebutting the presumption of the existence of a legally enforceable debt or liability. The defence, whether founded on direct evidence or drawn from material contradictions, omissions, or improbabilities in the complainant's case, must inspire confidence and raise a credible doubt regarding the purpose for which the impugned cheque was issued. The Court, therefore, undertakes a comprehensive examination of the evidence led on behalf of the defence, as well as the nature and consistency of the explanations offered by the accused, to determine whether the statutory presumption has been effectively dislodged.
46. In his statements recorded under Section 251 Cr.P.C. and Section 313 Cr.P.C., the accused, Akashdeep Singh, admitted to having issued the cheque in question in favor of the complainant but denied any liability to the extent of Rs. 80,000 as of the date of its presentation. He contended that the Digitally signed by SHRUTI SHRUTI SHARMA Page no. 21/30 SHARMA Date:
2025.08.30 16:49:36 +0530 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh cheque and other cheques were obtained from him forcefully by the complainant at the time of his termination in March 2012. The accused claimed that he had never taken any loan of Rs. 8,00,000 or any such amount from the complainant and that the signatures on the loan agreement and the cheque were obtained under duress and threat. He asserted that the cheque was issued without his consent or knowledge regarding the amount and date and denied the complainant's allegations of the loan transaction. Furthermore, he claimed to have taken incentives of Rs. 8 lakhs from the complainant. The accused also highlighted that he was not liable to pay the alleged loan amount and argued that the complaint filed by the complainant was false and mala fide aimed at evading the company's liabilities towards him, including unpaid salary and incentives.
47. In his chief examination, Akashdeep Singh stated that he joined Bhayana Builders Pvt. Ltd. as a billing engineer. He claimed that on 5 th March 2012, he was called into the company office, where he was confined for 2-3 hours and forcibly made to sign documents and hand over certain cheques, including the cheque in question. He denied taking any loan from the complainant company and asserted that the signatures on the loan agreement and cheques were obtained under threat and coercion. Akashdeep contended that he did not receive Rs. 8 lakhs on 05.03.2012 or thereafter from the complainant. He asserted he has no legally enforceable debt towards the complainant and denied liability for the cheque amount, claiming that the present case was falsely instituted by the complainant to evade its own liabilities toward him.
48. In his cross-examination, the accused Akashdeep Singh deposed that prior to joining the complainant company, he was employed with JJ Constructions as a site engineer, where he was drawing a salary of about Digitally signed by SHRUTI SHRUTI SHARMA SHARMA Date:
2025.08.30 16:49:38 +0530 Page no. 22/30 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh ₹20,000/- per month. In the year 2006, he joined the complainant company initially as a billing engineer, and was later promoted to the post of Project Manager during 2008-2010. He continued to work in the complainant company, drawing increments as per company policy, though he stated that he could not remember his exact salary at the time of leaving. When confronted with Ex.CW1/J, he admitted his signatures at point A but claimed that the same had been obtained from him forcefully by the complainant. He asserted that the cheque in dispute had also been obtained under coercion, which prompted him to file a civil suit for cancellation of the loan agreement and cheques, a recovery suit for his salary dues, and a criminal complaint against the complainant. He admitted that the civil suit had been dismissed on the ground of limitation, but clarified that the matter was pending before the Hon'ble High Court of Delhi in appeal.
49. The accused further admitted that a sum of ₹8 lakhs had been credited into his bank account by the complainant company on 25.05.2011, but he consistently maintained that this amount was given as an incentive and not as a loan. He explained that the incentive was for the period from May 2010 to May 2011 and, to his knowledge, no other employee received such incentive. He added that the complainant company did not issue any written communication in this regard but had only orally communicated about the incentive. He admitted that he had been filing income tax returns regularly from the time he joined the complainant company, but he could not confirm whether the ₹8 lakhs incentive was reflected in his ITR, stating that only his Chartered Accountant could answer. He also admitted that he never received any Form-16 for the said amount, though he denied the suggestion that this was because the sum represented a loan.Digitally signed by SHRUTI SHARMA
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50. He further deposed that he had received a legal notice dated 26.11.2012 from the complainant and had replied to the same, though he did not recall the date of reply and admitted that it was not on record. He denied the suggestion that the reply was concealed as it contained an admission of loan. He reiterated that no loan was ever taken and that he had sent the reply. He admitted that he had received three other notices from the complainant company as well. The accused denied suggestions that his civil and criminal cases against the complainant were false and frivolous, or that he had been changing his version to suit the circumstances. He maintained throughout that the amount of ₹8 lakhs was only an incentive, denied taking any loan, and rejected the suggestion that he was deposing falsely.
51. Despite having admitted the issuance of the cheque in question and the affixation of his signature thereon, the accused has sought to rebut the statutory presumption under Section 139 of the Negotiable Instruments Act by projecting a defence that the cheque was handed over under duress and that the amount of Rs. 8 Lakhs was received from the complainant as incentive and not as a loan as alleged by the complainant.
52. Upon consideration of the evidence adduced by both sides, this Court is constrained to note that certain material gaps do emerge in the complainant's case, particularly as revealed during the post-summoning examination of CW-1. One such infirmity pertains to the fact that while the alleged loan was stated to have been disbursed on 25.05.2011, the loan agreement was admittedly executed only on 05.03.2012. This gap between disbursal of loan and execution of the loan agreement does cast a shadow over the precision of the complainant's version. Such infirmity though not fatal to the case in itself, is nonetheless a factor which warrants careful Digitally signed by SHRUTI SHRUTI SHARMA SHARMA Date:
2025.08.30 16:49:42 +0530 Page no. 24/30 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh consideration in assessing the overall credibility of the complainant's testimony and in weighing it against the defence put forth by the accused.
53. The accused has, at more than one stage of the proceedings, sought to take refuge under the plea that his signatures on the cheques in question and on the loan agreement were not voluntarily affixed but were obtained under coercion. He further alleged that, contemporaneously, he had even lodged a criminal complaint before the competent authority with respect to such duress. This Court, however, finds that the said defence is entirely unsupported by any admissible material. No primary record, such as the original complaint has been produced. Even secondary evidence, or any communication from the police authorities, has not been placed on record to show that such a complaint was ever lodged, much less pursued to its logical conclusion. Although, the complainant has admitted that the same was filed but no attempt was made by the accused to prove the contents of the said complaint. Significantly, the accused has also failed to explain why, if such a complaint was indeed filed, he made no effort to summon the concerned record from the police station or the court to corroborate his assertion and prove the contents of the complaint.
54. The accused has admitted receipt of the statutory demand notice;
however, he has failed to produce any reply thereto. This omission is of considerable significance. Had his version--that there was no loan and the amount represented only an incentive, or alternatively that his signatures were obtained under coercion--been genuine and contemporaneous, a written reply to the notice would have been the first and most natural course of action in order to rebut the allegations. The absence of such a reply, therefore, speaks volumes and militates against the credibility of the defence. Likewise, the accused has not placed on record any complaint, Digitally signed by SHRUTI SHARMA SHRUTI Date:
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acknowledgment, or contemporaneous document to show that he ever approached the police or other authorities with allegations of coercion. The failure to bring forth such direct and available evidence, despite being within his special knowledge appears to be fatal.
55. The law is well settled that when a party sets up a plea based upon facts within his exclusive knowledge, the burden of proving those facts squarely rests upon him. The accused, therefore, was bound to establish through credible and cogent evidence that his signatures had been obtained under duress. Instead, what emerges is a bald allegation, bereft of even the slightest corroboration. Such unsubstantiated assertions, in the considered opinion of this Court, cannot rebut the statutory presumptions under Sections 118 and 139 of the Negotiable Instruments Act, which are attracted once execution of the cheque is admitted.
56. The accused has also attempted to put forth an alternate plea that the amount in question was not advanced as a loan but was given to him as an "incentive." This defence, however, is entirely devoid of supporting material. The accused has not produced a single document to substantiate this claim--neither a letter of sanction, nor an email, nor any HR record or company statement evidencing the alleged incentive. No policy document of the company, no board resolution, and no contemporaneous correspondence have been brought on record to suggest that such a benefit was ever contemplated or extended to him. In the ordinary course of business, incentives or bonuses are sanctioned through written communications, are duly minuted, or at the very least find mention in employment records and salary slips. The complete absence of any such material renders the plea wholly implausible.
Digitally
signed by
SHRUTI
SHRUTI SHARMA
SHARMA Date:
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57. Further, the plea of the accused that the sum in question represented an "incentive" suffers from yet another fatal infirmity, namely the complete absence of any factual foundation or rational basis to explain how the figure of ₹8,00,000/- was arrived at. The accused has not disclosed any method of calculation, any project target achieved, or any incentive scheme pursuant to which such an amount could plausibly have been sanctioned. No bonus structure, appraisal record, or remuneration policy of the company has been produced on record. Nor has the accused examined any independent oral witness, apart from himself, who could have corroborated this claim. It is also a matter of common course that incentives or performance-linked bonuses of such magnitude are governed by formal company policy, tied to performance metrics, or approved by board or HR resolutions, none of which has even been suggested, let alone proved, by the defence. In the absence of such fundamental material, the plea that the cheque represented an incentive payment stands exposed as a mere bald assertion, unsupported by evidence, and therefore wholly unreliable.
58. The accused has himself admitted during the course of his examination that he is a regular income tax assessee and files his Income Tax Returns every year. Despite this admission, he has failed to place on record any ITR which reflects the receipt of the alleged sum of ₹8,00,000/- as incentive income. It is trite that any sum received by an employee as salary, bonus, incentive, or perquisite is compulsorily required to be declared in the return of income for the relevant assessment year. Had the accused in fact received such a substantial amount by way of incentive, the same would necessarily have been reflected under the head "Income from Salary" or "Perquisites" in his ITR. The deliberate omission to produce such returns, which are documents in his exclusive possession, attracts adverse Digitally signed by SHRUTI SHRUTI SHARMA SHARMA Date:
2025.08.30 16:49:50 +0530 Page no. 27/30 CC no. 622707/20176 Bhayana Builders Pvt. Ltd. Vs. Akashdeep Singh inference that the evidence withheld, if produced, would have gone against the party withholding it. Thus, an adverse inference is liable to be drawn that the ITRs, if placed before the Court, would not have supported the defence plea of incentive income.
59. This conclusion is further reinforced by the admitted position that no Form 16 was ever issued to the accused in respect of this alleged incentive. It is a matter of established practice under the Income Tax Act that any component of salary, including bonus or incentive payments of significant value, attracts tax deducted at source (TDS) and is accordingly reflected in the Form 16 issued by the employer to the employee. The absence of any such Form 16, coupled with the failure of the accused to produce contemporaneous ITRs or salary slips, completely belies his plea. In the normal course of human conduct, no corporate entity would disburse such a large incentive in cash or without maintaining the requisite financial records. The fact that the accused has not brought on record even the most elementary documents--such as salary slips, incentive approval letters, or HR communications--further exposes the hollowness of this defence.
60. The Court is, therefore, constrained to hold that the theory of incentive income, raised by the accused, is nothing but a bald and unsubstantiated assertion. In the face of admitted filing of ITRs and the mandatory statutory framework requiring disclosure of salary and perquisites, the failure to produce the best evidence within his reach demolishes his credibility. Accordingly, the "incentive" plea stands wholly discredited and is rejected as an afterthought lacking any factual or legal foundation Digitally signed by SHRUTI SHRUTI SHARMA SHARMA Date:
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61. Now as far as the the gap in the complainant's case, namely that the loan amount was allegedly advanced prior to the formal execution of the loan agreement is concerned, while such a sequencing may reflect a shortcoming in the process adopted between the parties, it does not, by itself, negate the existence of a legally enforceable liability. CW1 has explained clearly in his evidence about the circumstances which warranted the execution of the loan agreement. Furthermore, what is of material importance is not the precise chronology of the documentation, but whether the essential ingredients of the offence under Section 138 of the Negotiable Instruments Act stand satisfied. In the present case, the core facts are undisputed: the issuance of the cheque by the accused, the dishonour thereof on the ground of insufficiency of funds, and the failure of the accused to make payment despite receipt of statutory demand notice. Once these foundational facts are established, the statutory presumption under Section 139 of the NI Act operates with full force in favour of the complainant. The burden then shifts upon the accused to rebut the presumption by credible and convincing evidence, which he has conspicuously failed to discharge.
62. In the totality of circumstances, though certain gaps can be noticed in the complainant's version, the defence set up by the accused does not probabilise any cogent or consistent explanation capable of dislodging the statutory presumptions under Sections 118 and 139 of the Negotiable Instruments Act. On the contrary, when tested against the record, the complainant's narrative appears more probable and reliable. The accused has himself admitted issuance of the cheques and his signatures thereon, yet has failed to present any credible alternative to explain away the liability. In such a situation, the presumption of legally enforceable debt stands unrebutted and necessarily operates in favour of the complainant.
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63. Accordingly, this Court finds the version put forth by the complainant to be trustworthy, consistent, and convincing, whereas the defence advanced by the accused is implausible, self-serving, and unreliable, and therefore fails to inspire any confidence.
Conclusion
64. In the light of the aforementioned discussion, the complainant has successfully proved all the ingredients of Section 138 NI Act. Accordingly, this court holds accused Mr. Akashdeep Singh guilty for committing the offence under section 138 of the NI Act and he is hereby convicted. Let him be heard on point of sentence on another date.
65. The judgment duly digitally signed be uploaded on CIS and a copy of the judgment be given dasti to the convict free of cost forthwith.
Digitally signed Announced in the open by SHRUTI
On 30.08.2025. SHRUTI SHARMA
SHARMA Date:
2025.08.30
16:49:57 +0530
(Shruti Sharma-I)
JMFC (NI Act)-02, South-East,
Saket Courts, New Delhi,30.08.2025
Certified that this judgment contains 30 pages and each page bears my signature.
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