Delhi District Court
Gulshan Kumar Kapoor vs Meena Girdhar on 21 February, 2026
In The Court of Sh. Divyam Lila, Municipal Magistrate, East, Delhi
JUDGEMENT
DLET020048452018 CT Cases/2812/2018 Date of Filing : 09-07-2018 Date of Registration : 10-07-2018 Date of Disposal : 21-02-2026 ________________________________________________________________ (Complainant): Sh. Gulshan Kumar Kapoor S/o Late Sh. R.S. Kapoor R/o 340, Gagan Vihar, Delhi-110051 Digitally signed by DIVYAM Versus DIVYAM LILA LILA Date:
2026.02.21 16:21:03 (Accused) Ms. Meena Girdhar +0530 W/o Sh. Gunesh Girdhar R/o 66, 3rd Floor, Shrestha Vihar, Deli-92 Also at: 30, DLF New tower heights, Sector 86, Gurgaon, Haryana-122004 ________________________________________________________________ Advocate appearing for Complainant: Sh. Kashish and Ms. Shrishti Advocate appearing for the Accused: Sh. Vijay Rana Offence punishable under : Section 138 of Negotiable Instruments Act, 1881 Final Order : Conviction under Section 138 NI Act ________________________________________________________________
-:Index of Judgment:-
1. Introduction:-.................................................................................................. 2
2. Brief Facts of the Case:-................................................................................. 2
3. Notice Framed on the Accused and Plea of the Accused:........................... 3
4. Issues for Determination:............................................................................... 3
5. Evidence on Record........................................................................................ 4
6. Legal Position:.................................................................................................8
7. Arguments of the parties:.............................................................................10
8. Analysis and Findings:................................................................................. 14
10. Order:...........................................................................................................25 1 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
1. Introduction:-
a. The present judgment arises out of a complaint filed under Section 138 of the Negotiable Instruments Act, 1881, on the basis of the friendly loan as debt.
2. Brief Facts of the Case:-
a. The case of the complainant Sh. Gulshan Kumar Kapoor , is that he and the accused, Ms. Meena Girdhar , shared friendly relations for many years. In the month of October 2016, the accused approached the complainant seeking a friendly loan of Rs. 7,50,000/-. The complainant subsequently arranged and advanced a sum of Rs. 7,11,700/- in cash to the accused as a friendly loan. To discharge this liability, the accused issued six post-dated cheques in favor of the complainant, assuring him that they would be honored upon presentation.
b. These instruments comprised five cheques drawn on Vijaya Bank, Vikas Marg branch (Cheque No. 927939 for Rs. 1,00,000/-; Cheque No. 927942 for Rs. 28,500/-; Cheque No. 927943 for Rs. 2,38,300/-; Cheque No. 927947 for Rs. 33,500/-; and Cheque No. 927948 for Rs. 61,400/-) and one cheque drawn on Oriental Bank of Commerce (Cheque No. 42976 for Rs. 2,50,000/-), all dated 30.05.2018 (hereinafter called as "cheques in question"). Acting on the accused's assurance, the complainant presented the said cheques for encashment; however, to his dismay, all six cheques were dishonored and returned unpaid with the remarks "Funds Insufficient" vide returning memos all dated 04.06.2018.
Consequently, the complainant issued a statutory legal demand notice to the accused on 07.06.2018 via registered A.D. through his advocate. Despite the due service of the said legal notice, the CT Case /2812/2018 Page 2 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi accused failed to make the payment of the cheque amounts , thereby prompting the complainant to institute the present complaint under Section 138 of the Negotiable Instruments Act, 1881.
3. Notice Framed on the Accused and Plea of the Accused:
a. The accused was served notice under Section 251 Cr.P.C and pleaded "not guilty" and this matter was listed for trial by recalling the complainant's witness.
b. At the time of framing of the said notice under Section 251 Cr.P.C., the accused was asked to disclose her defense. In her response, the accused admitted that the cheques in question (Cheque Nos. 927939, 927942, 927943, 927947, 927948, and 42976) belonged to her respective bank accounts and unequivocally admitted her signatures on all the six cheques. She, however, categorically denied filling in the remaining particulars on the cheques, such as the date, the name of the payee, and the amount (in words and figures). The accused claimed that she had never handed over the cheques to the complainant and that the complainant has filed multiple cases against the accused and her family members. The complainant had a family relationship with the accused and the accused stated that she did not know how the cheques came in possession of the complainant.
4. Issues for Determination:
a. The cheque was issued in discharge of a legally enforceable debt or liability.?
b. The cheque was presented within the period of validity of three months?.
c. The cheque was dishonoured for insufficiency of funds.?CT Case /2812/2018 Page 3 of 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi d. A legal notice was duly served.?
e. The accused failed to make payment within the prescribed period. f. The accused has successfully rebutted the statutory presumption under Sections 118 and 139 of the NI Act.?
5. Evidence on Record a. Complainant's Evidence: To prove his case, the complainant, Sh. Gulshan Kumar Kapoor, examined himself as CW-1 and tendered his evidence by way of an affidavit, adopting his pre-summoning evidence. He relied upon several documentary exhibits, marked as Ex. CW1/1 to Ex. CW1/10. In his affidavit, the complainant deposed that he had friendly relations with the accused for many years and that in October 2016, the accused approached him for a friendly loan of Rs. 7,50,000/-. He further deposed that he arranged and advanced a sum of Rs. 7,11,700/- in cash to the accused. In discharge of this liability, the accused allegedly issued six post-dated cheques in favor of the complainant, all dated 30.05.2018, which were exhibited as Ex. CW1/1 to CW1/6. Upon presentation, these cheques were dishonored and returned unpaid with the remark "Funds Insufficient" vide return memos dated 04.06.2018, exhibited as Ex. CW1/7 (colly). Consequently, the complainant issued a legal demand notice dated 07.06.2018 (Ex. CW1/8) via registered A.D., the receipt and acknowledgment of which were exhibited as Ex. CW1/9 and Ex. CW1/10 respectively. The complainant asserted that despite the service of this legal notice, the accused failed to make the payment. During his cross-examination by the learned counsel for the accused, CW-1 admitted that there was no commercial transaction between them, CT Case /2812/2018 Page 4 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi but they shared a family relationship for the last 20 years. He conceded that he gave the loan amount in cash without obtaining any written receipt, though he claimed to possess bank statements showing his withdrawals. The complainant acknowledged that he retired in 1999, does not possess a money-lending license, and his primary source of income is interest on fixed deposits (FDs) and savings. When questioned about his financial capacity and bank balance in 2016, he admitted having a balance of approximately Rs. 2,000/-, but volunteered that he had an overdraft facility on his FDs, which currently amount to up to Rs. 90 lacs. He admitted that there was no bank withdrawal precisely in October 2016; however, he clarified that he withdrew the loan amount in self-transactions over time, specifying withdrawals such as Rs. 2,75,000/- on 07.03.2016, Rs. 2,50,000/- on 26.04.2016, and others. He conceded that these specific withdrawals and the fact that the loan was given in cash were not explicitly mentioned in his complaint, nor was the loan disclosed in his income tax returns for the years 2015-2016 and 2016-2017. Regarding the cheques, the complainant deposed that they were handed over to him in April or May 2018 at his home. He testified that the accused signed the cheques in his presence, while her son filled in the other particulars, firmly denying the suggestion that he had stolen, filled, or misused the cheques.
b. Statement of the accused: In her statement recorded under Section 313 read with Section 281 of the Code of Criminal Procedure, the accused admitted that the signatures on the impugned cheques were indeed hers. However, she categorically denied issuing these cheques to the complainant. She denied having any financial transaction with the complainant and specifically CT Case /2812/2018 Page 5 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi refuted the claim that she had taken any loan from him. She maintained that she has no legally enforceable liability towards the complainant. The accused also claimed she did not fill in the particulars on the cheques. She advanced the defense that her cheque book had been misplaced. When questioned about the legal demand notice, she denied receiving it. Nevertheless, she conceded that the address mentioned on the said notice was her correct address. Upon being asked whether she intended to lead defense evidence, the accused answered in the affirmative, expressing her desire to examine herself as a witness.
c. Defense Evidence:.To substantiate her defense, the accused moved an application under Section 315 of the Cr.P.C. seeking permission to examine herself as a defense witness, which was duly allowed by the Court, and she was examined as DW-1. In her examination-in-chief, the accused broadly reiterated the defense taken by her at the time of the framing of notice and in her statement under Section 313 Cr.P.C. She deposed that she never approached the complainant for any friendly loan of Rs. 7,50,000/- in October 2016, nor did she receive the alleged cash amount of Rs. 7,11,700/-. She maintained that she merely shared friendly, family-like relations with the complainant and that the six impugned cheques were never handed over to him in discharge of any legally enforceable debt or liability. She further testified that her purse, which contained her signed cheque book, was misplaced or lost, for which she claimed to have lodged a Non-Cognizable Report (NCR). However, crucially, she failed to place on record any certified copy of the said NCR or examine any police official to prove the loss of the cheques. During her partial cross-examination by the learned counsel for the complainant, she CT Case /2812/2018 Page 6 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi admitted her signatures on the cheques but remained evasive and unconvincing when questioned about whether she had ever issued any "stop payment" instructions to her bank regarding the allegedly lost cheques. Furthermore, she could not offer any plausible explanation as to why she chose not to reply to the statutory legal demand notice, despite conceding that it was sent to her correct residential address. After being partly cross-examined, her further cross-examination was deferred, and the matter was listed for the continuation of Defense Evidence (DE).
d. However, the accused subsequently adopted a highly dilatory approach and deliberately failed to make herself available for the conclusion of her cross-examination or the leading of any further defense evidence, culminating in the closure of her right to lead evidence by judicial order. As per the order, on the date fixed for Defense Evidence, the complainant and his learned counsel were present, but the accused was conspicuously absent without any prior intimation or exemption application. The Court waited, and despite repeated calls being made at 11:00 AM, 12:30 PM, and 12:50 PM, neither the accused nor her counsel appeared physically or through video conferencing. Taking a strict view of the accused's deliberate non-appearance, the Court noting that her presence was strictly required for the DE proceedings and that the accused was intentionally evading the process of law to protract the trial, and that the defense evidence stands closed; listing the matter for final arguments. Thus, the defense evidence was formally closed by the Court due to the accused's persistent and unjustified failure to participate in the trial.
e. Hence, matter was listed for final arguments.
CT Case /2812/2018 Page 7 of 26In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
6. Legal Position:
a. In order to constitute an offence under Section 138 of the Negotiable Instruments Act, 1881, the following essential elements must be satisfied as per the judgement in Kusum Ingots & Alloys Ltd. Vs. Pennar Peterson Securities Ltd. AIR 2000 SC 954 ,both in the complaint and the evidence presented by the complainant:
i. Drawing of the Cheque: The accused must have drawn a cheque on an account maintained by them, for the payment of a legally enforceable debt or liability to another person. ii. Timely Presentation: The cheque must be presented to the bank for payment within three months from the date on which it was drawn, or within the period of its validity, whichever is earlier.
iii. Dishonour of the Cheque: The cheque must be dishonoured by the bank due to either insufficient funds in the account or because the amount exceeds the arrangement made with the bank.
iv. Notice of Demand: The payee or holder of the cheque must issue a written demand for payment to the drawer, within 30 days of receiving information from the bank regarding the dishonour.
v. Failure to Pay: The drawer must fail to make payment within 15 days of receiving the notice of demand.
b. Additionally, the provisions of Sections 139 and 118 of the Act further strengthen the case for the complainant. Section 139 creates a presumption in favour of the holder of the cheque, mandating that the court shall presume, unless proven otherwise, that the cheque was issued for the discharge of a debt or other liability. Section 118, on the other hand, provides that there is a presumption that CT Case /2812/2018 Page 8 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi every negotiable instrument, including a cheque, was made for consideration, and that it was transferred for consideration. c. In the case of Basalingappa v. Mudibasappa (2019) 5 SCC 418;, the Hon'ble Supreme Court has laid down that once the execution of the cheque is admitted, Section 139 imposes a rebuttable presumption in favour of the complainant, establishing that the cheque was issued for the discharge of a debt or liability. The presumption is rebuttable and the accused has the opportunity to raise a probable defence. The standard of proof for rebutting this presumption is based on the preponderance of probabilities. d. The court further held that it is not mandatory for the accused to enter the witness box to prove their defence. They may rely on the evidence presented by the complainant or any other available materials. The onus to rebut the presumption lies on the accused, but it is important to note that this is an evidentiary burden, not a persuasive one.
e. Thus, Section 138 operates on the principle of reverse onus of proof - once the complainant proves the essential elements of dishonour, the burden shifts to the accused to raise a plausible defence. The presumption of guilt is strong, but not irrebuttable, and the accused is entitled to challenge it through a preponderance of evidence.
f. In the backdrop of legal position as enunciated above, it is to be examined by this Court that whether the accused on a scale of preponderance of probabilities has been able to rebut the presumption which has been raised against him and in favour of the complainant, or has been able to demolish the case of the complainant to such extent so as to shift the onus placed upon the accused again on the complainant. As held by Hon'ble Supreme CT Case /2812/2018 Page 9 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi Court of India in case of Kumar Exports vs Sharma Carpets (2009) 2 SCC 513, the accused can either prove the non−existence of the consideration and debt by direct evidence or by bringing on record such facts and circumstances, upon consideration of which, the Court may either believe that the consideration and debt either did not exist or their non−existence was so probable that a prudent man may act upon the plea that they did not exist. If the Court comes to the conclusion that the accused has not been able to rebut the presumption raised against him by failing to bring on record direct evidence or by even failing to sufficiently perforate the case of the complainant, the complainant is entitled to a decision in his favour.
7. Arguments of the parties:
a. Arguments by Ld. Counsel for the Complainant: The learned counsel for the complainant submitted that the case is squarely covered under Section 138 of the Negotiable Instruments Act, 1881, and the accused is liable for the dishonour of the cheque. Written arguments were also filed by the counsel for the complainant. The key arguments advanced by the counsel urged the court to convict the accused, are as follows:
i. It was argued that since the accused has categorically admitted her signatures on all the six impugned cheques (Ex. CW1/1 to Ex. CW1/6) during the framing of notice under Section 251 Cr.P.C. as well as in her statement under Section 313 Cr.P.C., the statutory presumptions under Section 118(a) and Section 139 of the Negotiable Instruments Act, 1881, are immediately drawn in favor of the complainant. Therefore, it CT Case /2812/2018 Page 10 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi is legally presumed that the cheques were issued for a valid consideration and in discharge of a legally enforceable debt.
ii. Addressing the defense's challenge to the complainant's financial capacity, the Ld. Counsel submitted that the complainant (CW-1) has successfully withstood the test of cross-examination. CW-1 gave clear and specific details regarding his financial status, including possessing Fixed Deposits worth approximately Rs. 90 Lakhs, enjoying overdraft facilities, and making specific cash withdrawals (e.g., Rs. 2,75,000/- on 07.03.2016 and Rs. 2,50,000/- on 26.04.2016) prior to advancing the loan. This sufficiently establishes his financial wherewithal to advance the loan amount of Rs. 7,11,700/-.
iii. It was strongly contended that the defense taken by the accused that her purse containing the signed cheque book was misplaced is a fabricated afterthought and a complete sham. The counsel highlighted that no prudent person who has lost signed blank cheques would fail to issue "stop payment" instructions to their bank. The return memos (Ex. CW1/7 colly) show the reason for dishonor as "Funds Insufficient" and not "Payment Stopped by Drawer." Furthermore, the accused utterly failed to prove the alleged NCR on record or examine any police official to substantiate her claim of the lost purse.
iv. The Ld. Counsel pointed out that the accused admitted that the statutory legal demand notice (Ex. CW1/8) bore her correct residential address. Relying on Section 27 of the General Clauses Act, it was argued that the notice is deemed to have been duly served. The failure of the accused to reply CT Case /2812/2018 Page 11 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi to this notice at the very first available opportunity indicates that she had no valid defense and tacitly admitted her liability at that time.
v. The counsel heavily emphasized the evasive and dilatory conduct of the accused. It was argued that the accused deliberately absented herself during the stage of Defense Evidence, actively evading her cross-examination as DW-1. This blatant non-participation led to the closure of her defense evidence by the Court. Such conduct clearly demonstrates that the accused had no substantive evidence to rebut the presumption and was merely trying to derail the judicial process.
b. Arguments by Ld. Counsel for the Accused : The learned counsel for the accused vehemently argued that the complainant has failed to prove the existence of a legally enforceable debt, and the case is based on a fabricated narrative to extort money. The key arguments advanced by the counsel, while praying for the acquittal of the accused, are as follows:
i. The primary contention raised by the defense was that there was no existing legally enforceable debt or liability. It was argued that the accused never approached the complainant for any loan of Rs. 7,50,000/-, nor was any cash amount of Rs. 7,11,700/- ever advanced to her. The entire transaction is a fabricated concoction.
ii. The defense strongly asserted that the impugned cheques were never handed over to the complainant. It was argued that the accused had lost her purse containing her signed blank cheque book, and the complainant, taking undue CT Case /2812/2018 Page 12 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi advantage of their friendly relations and access, somehow came into possession of these cheques, filled in the arbitrary amounts and dates, and misused them to file a false and frivolous complaint.
iii. The Ld. Counsel for the accused heavily attacked the financial capacity of the complainant to advance such a huge cash loan. It was highlighted from the cross-examination of CW-1 that he is a retired individual whose bank balance in 2016 was merely around Rs. 2,000/-. Furthermore, it was argued that the complainant failed to demonstrate any specific bank withdrawal matching the exact loan amount in October 2016.
iv. The defense pointed out that the complainant deliberately suppressed the alleged loan amount in his Income Tax Returns (ITR) for the relevant assessment years. Additionally, it was argued that advancing a cash loan exceeding Rs. 20,000/- is in clear violation of Section 269SS of the Income Tax Act, which further casts a shadow of doubt on the veracity and legality of the alleged transaction. v. It was argued that it is highly improbable for any prudent person to advance a massive sum of Rs. 7,11,700/- in cash without executing any written loan agreement, promissory note, or even a basic receiving receipt. The complete absence of any documentary evidence supporting the advancement of the loan renders the complainant's story highly doubtful. vi. It was contended that the accused never received the statutory legal demand notice. Therefore, the essential ingredient of Section 138(b) and (c) of the NI Act failure to pay within 15 days of the receipt of the notice is not CT Case /2812/2018 Page 13 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi satisfied, and the complaint is liable to be dismissed on this technical ground alone.
8. Analysis and Findings:
a. Issue 1 - Issuance of Cheque: This ingredient pertains to the issuance of the cheque in question itself. The Accused person has in the notice of accusation admitted signature on the cheque in question. The accused has however denied filling the particulars on the same. It is observed that the plea of the accused that the particulars of the cheque in question were not filled by her is of no help; as the signature of the accused on the cheque is not disputed. Reliance can be placed, at this juncture, wherein Hon'ble High Court of Delhi in Ravi Chopra Vs. State and Anr. (2008) 102DRJ147, held: "Section 20 NI Act talks of "inchoate stamped instruments" and states that if a person signs and delivers a paper stamped in accordance with the law and "either wholly blank or have written thereon an incomplete negotiable instrument" such person thereby gives prima facie authority to the holder thereof "to make or complete as the case may be upon it, a negotiable instrument for any amount specified therein and not exceeding the amount covered by the stamp." "A collective reading of the above provisions shows that even under the scheme of the NI Act it is possible for the drawer of a cheque to give a blank cheque signed by him to the payee and consent either impliedly or expressly to the said cheque being filled up at a subsequent point in time and presented for payment by the drawee. There is no provision in the NI Act which defines the difference in the handwriting or the ink pertaining to the material particulars filled up in comparison with CT Case /2812/2018 Page 14 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi the signature thereon as constituting a 'material alteration' for the purposes of Section 87 NI Act. What is essential is that the cheque must have been signed by the drawer." Further, in Bir singh Vs. Mukesh Kumar, (2019) 4 SCC 197 it was held that:- "It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be attracted." Hence, In the present case, Prima facie the ingredient that the cheque was issued to the complainant has been satisfied as the accused admitted her signature on the cheque and the account being maintained by her. Having admitted the basic ingredient, the presumption is drawn against the accused and now the accused would have to prove that the cheque in question was not issued by her; by way of rebuttal of the presumption drawn against him. Whether the accused was able to successfully rebut the adverse presumption is dealt in detail in the issue no. 6; However, the issue no. 1 is decided in favour of the complainant and the presumption is drawn against the accused.
b. Issue 2 - Presentation within Validity: This ingredient stands satisfied on a bare perusal of the cheque in question Ex. CW1/A and the return memo Ex. CW1/B being presented within the period of validity. The cheque is also not dishonoured with the remark "instrument stale"; as the cheque has been returned dishonoured with a return memo noting the reason for return as "insufficient funds". The defence has led no evidence to contradict the same and hence, this ingredient stands fulfilled as against the accused. Hence, this issue is also decided in favour of the complainant and the cheque has been proved to be dishonoured within the period of validity.CT Case /2812/2018 Page 15 of 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi c. Issue 3 - Dishonour of Cheque: The bank return memo records state that the cheque in question has been returned dishonoured for the reason "insufficient funds". The defence has led no evidence to contradict the same and hence, this ingredient also stands satisfied as against the accused. Hence, this issue is also decided in favour of the complainant and the cheque has been proved to be dishonoured.
d. Issue 4 - Legal Notice: Service of the legal notice is the legal fiction which constitutes the major ingredient of the offence u/s-138 NI Act. The objective of serving legal demand notice to the Accused before filing the case is to allow the accused to make the payment. As regards the service of legal demand notice, the Complainant has sent the same to the accused. That the accused has in her notice of accusation u/s 251 Cr.P.C denied receiving the legal demand notice and Sec 313 CrPC again denied receiving the notice, however, the accused admitted the address mentioned on legal notice is correct. The accused has also not led any positive evidence to prove that the legal notice was not served on him, nor any evidence to prove that the address on the legal notice is correct. The Sec. 27 of the general clauses act provides for the presumption for the service. At this stage, reliance can be placed on the judgement of the Hon'ble Supreme Court of India in C.C. Alavi Haji Vs. Palapetty Muhammed, 2007 (6) SCC 555 while discussing the true intent behind the service of legal demand notice as a precursor to the launch of prosecution held that the service of summons of the court is opportunity enough for the accused to pay the cheque amount and evade prosecution and any accused who fails to pay the amount within 15 days of the service of summons, clearly cannot protect himself/herself behind the technical demand CT Case /2812/2018 Page 16 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi of non-service of legal notice. Thus, in absence of any evidence against the presumption of service and admission of the accused with respect to address being correct, this issue is also decided in favour of the complainant and the service of legal notice has been proved.
e. Issue 5 - Non-Payment within 15 Days: In the present case, after the issue no. 4 is against the accused, the case of the accused is that he does not have any liability towards the complainant and his cheque was misused. Hence, it is an admitted position that no payment for the cheque in question was made and thus this ingredient of non-payment within 15 days also stands satisfied. Hence, this issue is also decided in favour of the complainant and the cheque has been proved to be not paid by the accused despite service of notice.
f. Issue 6 : Defence of the Accused and Rebuttal of Presumption: The above ingredients being satisfied, the court would have to look at the defence brought out by the accused by way of cross examination of the complainant's evidence and the rebuttal by way of defence evidence. In the present case, the accused had made following attempts towards rebuttal of the statutory presumption against him; and with the following observations, it is held that the issue no. 6 is decided against the accused and in favour of the complainant:
i. Failure to Prove Misplacement and Misuse of Cheques:
A pivotal issue in the present factual matrix is whether the accused has successfully rebutted the statutory presumptions by proving her defense that the impugned cheques were never handed over to the complainant but were, in fact, misplaced and subsequently misused. Upon a meticulous CT Case /2812/2018 Page 17 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi appreciation of the evidence on record, this Court finds that the defense of the accused regarding the misplacement and subsequent misuse of the cheques is found to be a sham, devoid of any evidentiary backing, and highly improbable. The accused has failed to cross the threshold of preponderance of probabilities for following reasons:
1. Admission of Signatures and Shifting of Burden: At the very outset, it is a matter of record that the accused, both at the time of the framing of notice under Section 251 Cr.P.C. and in her statement under Section 313 Cr.P.C., unequivocally admitted her signatures on all the six impugned cheques (Ex.
CW1/1 to Ex. CW1/6). It is a settled proposition of law that once the signatures on the cheque are admitted by the drawer, the foundational facts are established. Consequently, the statutory presumptions under Section 118(a) (presumption of consideration) and Section 139 (presumption of a legally enforceable debt) of the Negotiable Instruments Act, 1881, are mandatorily drawn in favor of the complainant. The burden of proof strictly shifts to the accused to rebut these presumptions on the touchstone of "preponderance of probabilities."
2. Mere 'Ipse Dixit' Regarding Lost Cheques: The primary defense set up by the accused is that her purse, which contained her signed cheque book, was lost or misplaced, and she had allegedly filed a Non-Cognizable Report (NCR) regarding the same. However, a defense cannot be sustained on mere bare CT Case /2812/2018 Page 18 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi assertions. The accused completely failed to produce any certified copy of the alleged NCR on record. Furthermore, she did not examine any police official or lead any independent evidence to prove the factum of the loss of the cheques. In the absence of cogent documentary or corroborative oral evidence, the story of the lost purse remains a bald, unproved averment.
3. Unexplained Silence and Absence of "Stop Payment"
Instructions: The conduct of the accused critically undermines her defense. As a prudent person, if a signed cheque book is lost or misplaced, the immediate and natural course of action is to issue "stop payment" instructions to the drawee bank. During her cross-examination as DW-1, the accused was evasive and could not demonstrate that she ever approached her bank to stop the payment of the allegedly lost cheques. Tellingly, the return memos (Ex. CW1/7 colly) clearly indicate that the cheques were dishonored for the reason "Funds Insufficient"
and not "Payment Stopped by Drawer." This objective documentary evidence completely belies the accused's theory of misplacement.
4. Failure to Explain the Complainant's Possession: The accused has utterly failed to explain the circumstances under which the complainant, who is admitted to be a long-standing family friend, came into possession of these specific six sequentially/closely numbered cheques. If a purse is lost randomly, the mathematical probability of a specific family acquaintance finding it CT Case /2812/2018 Page 19 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi and misusing precisely six cheques is vanishingly low, unless explained by a coherent narrative of theft, which the accused has neither pleaded nor proved. The accused did not lodge any specific complaint of theft or cheating against the complainant either before or immediately after receiving the legal demand notice.
5. Failure of the accused to put cogent questions and suggestions to the witness to prove the defense: The accused also did not put questions concerning the alleged theft of the cheques to the witness CW-1 during the cross examination. No suggestions were given by the counsel that the complainant had obtained the cheques from the misplaced purse or from the household of the accused. No questions were asked under which circumstances the cheque were stolen. No complaint or NCR was shown or confronted by the accused to CW-1. The CW-1 categorically claimed that the cheque was given to him by the accused at his home, which was denied by the accused through suggestions.
ii. Failure to Rebut the Testimony of the Complainant: The accused miserably failed to elicit any material contradictions or create any dent in the complainant's version. The accused completely failed to shake the credibility of the complainant on several crucial fronts:
1. Unimpeached Financial Capacity and Clear Money Trail: The defense aggressively questioned the financial capacity of the complainant to advance a CT Case /2812/2018 Page 20 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi huge cash loan of Rs. 7,11,700/-. However, the complainant successfully withstood the rigors of cross-examination. He clearly deposed that although his savings bank balance might have been nominal at the exact time of the loan, he had immense financial backing in the form of Fixed Deposits (FDs) amounting to approximately Rs. 90 Lakhs, against which he enjoyed an overdraft facility. More importantly, the complainant established a clear money trail by specifying exact dates and amounts of cash withdrawals from his bank account prior to the advancement of the loan (e.g., Rs. 2,75,000/- on 07.03.2016 and Rs. 2,50,000/- on 26.04.2016). The defense failed to bring on record any evidence to contradict these withdrawals or prove that the complainant lacked the financial wherewithal. The Hon'ble Supreme Court in Rohitbhai Jivanlal Patel v.
State of Gujarat (2019) has held that once the complainant demonstrates the source of funds, the court should not be hyper-technical unless the accused brings positive evidence to the contrary. Here, the accused brought non.
2. Uncontroverted Friendly Relations: The foundation of the complainant's case rests on the premise of a long-standing, 20-year family relationship with the accused, which formed the basis of advancing a "friendly loan" without executing formal commercial documents like a promissory note or loan agreement. During cross-examination, the defense could not CT Case /2812/2018 Page 21 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi extract any admission that would negate the existence of these deep friendly ties. In the context of Indian society, the advancement of friendly loans in cash among close family friends, based purely on mutual trust, is not uncommon. The failure of the defense to dispute this relationship gives credence to the complainant's narrative as to why such a large sum was advanced in cash without stringent paperwork.
3. Lawful Possession of the Cheques: As discussed earlier, the accused's defense that her purse containing the signed cheques was lost remained a bald, uncorroborated assertion. Consequently, the defense completely failed to cast any doubt on how the complainant came into possession of the impugned cheques. Since the complainant's possession of the cheques is not tainted by any proved theft, misplacement, or coercion, the law presumes under Section 118(a) and Section 139 of the NI Act that the complainant is the "holder in due course" and that the cheques were handed over voluntarily by the accused in discharge of a legally enforceable debt. The cross-examination of CW-1 yielded nothing to suggest that the complainant acquired the cheques through deceit or illegal means.
4. Transparency Regarding Multiple Litigations: During the cross-examination, it was brought on record that the complainant has also filed similar complaints under Section 138 of the NI Act against other relatives of the accused, including the accused's son. The CT Case /2812/2018 Page 22 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi defense attempted to use this fact to suggest that the complainant is in the habit of filing false and frivolous cases. However, this Court finds that the complainant was entirely truthful and transparent about these parallel litigations. Rather than fatal to the complainant's case, this admission points towards a broader matrix of financial dealings between the complainant and the accused's family members, where the complainant advanced funds to the family and is now legitimately seeking legal recourse for multiple defaults. The defense utterly failed to extract any admission from CW-1 to suggest that the present complaint, or the others, were instituted out of malice, vendetta, or extortion.
iii. Non-Disclosure of Loan in ITR is Not Fatal to the Complainant's Case : Another major limb of the defense's argument is that the complainant failed to disclose the alleged friendly loan of Rs. 7,11,700/- in his Income Tax Returns (ITR) for the relevant assessment years, and further, that advancing a cash loan exceeding Rs. 20,000/- violates the provisions of the Income Tax Act. The defense urged that these omissions render the alleged debt legally unenforceable. However, upon a careful examination of the law and the specific facts of this case, this Court finds this argument to be fundamentally flawed and legally unsustainable as it is a well-settled proposition of law, established by various pronouncements of the Hon'ble High Court of Delhi and the Hon'ble Supreme Court of India, that the mere non-disclosure of a loan amount in the Income Tax CT Case /2812/2018 Page 23 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi Returns does not automatically render the debt legally unenforceable under the Negotiable Instruments Act. While advancing a cash loan above Rs. 20,000/- or failing to reflect it in the ITR may attract civil or penal consequences under the Income Tax Act, 1961 (such as under Section 269SS or Section 271D), it does not absolve the accused of their liability under Section 138 of the NI Act. The primary concern of this Court under the NI Act is to ascertain whether there was an actual advancement of funds creating a legally enforceable debt, not to assess the complainant's tax compliance. The statutory presumption under Section 139 of the NI Act cannot be defeated solely on the ground of non-disclosure in the ITR, provided the complainant independently proves their financial capacity and the source of the funds. Further, the complainant (CW-1) has not merely made bald assertions about having cash at home; rather, he has successfully established a clear and documented money trail originating from a legitimate source. During his cross-examination, the complainant candidly admitted the non-disclosure in his ITR but fortified his case by providing specific details of his bank withdrawals. He testified to having vast financial reserves in the form of Fixed Deposits and detailed specific withdrawals made from his bank account prior to advancing the loan, explicitly mentioning withdrawals of Rs. 2,75,000/- on 07.03.2016 and Rs. 2,50,000/- on 26.04.2016. The availability of funds is directly linked to these documented bank transactions. The accused completely failed to challenge or impeach this documented money trail during CT Case /2812/2018 Page 24 of 26 In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi cross-examination. The defense did not call upon the complainant to produce the physical bank statements, nor did they suggest that these specific bank withdrawals never took place or were diverted elsewhere. By leaving this aspect of the complainant's testimony entirely unchallenged, the defense has tacitly admitted the complainant's financial capacity and the legitimacy of the source of the funds.
9. Conclusion and Reason for decision:
a. The Issue no. 1, 2, 3, 4, 5 and 6 were decided in favour of the complainant and against the accused.
b. In the totality of the facts and circumstances of the present case, this Court is of the considered opinion that the accused has miserably failed to rebut the mandatory presumption raised against him under Section 139 of the Negotiable Instruments Act, 1881. The accused admitted his signature on the cheque, thereby triggering the presumption of a legally enforceable debt. Her claims regarding the misplacement of the cheque book and the absence of any loan transaction remained unproved and amounted to mere bald assertions. The statutory presumptions under Section 118(a) and Section 139 of the NI Act remained entirely unrebutted.
10.Order:
a. In view of the detailed reasons recorded, this Court is of the considered opinion that the complainant has successfully established the essential ingredients of the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 beyond reasonable doubt.CT Case /2812/2018 Page 25 of 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi b. Accordingly, the accused Smt Meena Girdhar is hereby CONVICTED for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881.
c. Let the convict be heard on the point of sentence. Copy of this judgment be supplied to the convict free of cost against acknowledgment.
d. The signed copy of the judgement be uploaded on the CIS immediately.
e. Pronounced in open court and in presence of both the parties/ or their Counsels. Digitally signed by DIVYAM (DIVYAM LILA) DIVYAM LILA LILA Date: Municipal Magistrate, East District 2026.02.21 16:21:22 Karkardooma Court/Delhi +0530 Date: 21.02.2026 CT Case /2812/2018 Page 26 of 26