Delhi District Court
Om Prakash Aggarwal vs Harish Chander on 15 October, 2025
DLST020523312019
IN THE COURT OF SH. NITIN SHAH, JMFC-05, N.I. ACT,
SOUTH DISTRICT, SAKET, NEW DELHI
CC No. : 4069/2020
U/s : 138 N. I. Act
PS : Saket
Om Prakash Aggarwal vs. Harish Chander
JUDGMENT
1. CC No. : 4069
2. Date of institution of the case : 21.11.2019
3. Name of complainant : Om Prakash Aggarwal
S/o R.C. Aggarwal
R/o LIG-1, Gayatri Enclave,
Khanpur, New Delhi
4. Name of accused, parentage
and address : Harish Chander
S/o Lt. Sh. Chuttan Ram
R/o 15/469, DDA Flats
Kalkaji, New Delhi.
5. Offence complained of : 138 N. I. Act
6. Plea of accused : Accused pleaded not guilty
7. Final order : Conviction
8. Date on which order was : 13.10.2025
reserved
9. Date of pronouncement : 15.10.2025
THE CONVICT HAS THE RIGHT TO AVAIL FREE LEGAL AID AS PER ENTITLEMENT IN ORDER TO PURSUE REMEDY BEFORE THE APPELLATE COURT/APPROPRIATE FORUM OF LAW.
THE CONVICT MAY CONTACT THE FOLLOWING :
O/o Ld. Secretary, DLSA-South, Room No. 309, 3rd Floor, Saket Court Complex, New Delhi. Contact No. 011-29562440, [email protected] Digitally signed by NITIN NITIN SHAH SHAH Date:
2025.10.15 15:46:38 +0530 CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 1 of 20 JMFC-05 (NI Act)/South DLST020523312019 FACTUAL BACKGROUND OF THE CASE
1. The present complaint has been filed by Sh. Om Prakash Aggarwal (hereinafter complainant) against Sh. Harish Chander (hereinafter accused) of Section 138 of the Negotiable Instruments Act, 1881(as in after referred to as NI Act).
2. The facts giving rise to the instant complaint case, as per the complainant, may be summarized as hereafter: That complainant and accused are known to each other. That accused approached the complainant for friendly loan of Rs. 5.50 lacs for personal needs and promised to return the same within a period of 3 years. That accused offered to pay interest @ 1.75% on the loan amount per month on monthly basis till repayment of loan. That complainant agreed to the same and advanced loan of Rs. 5.50 lacs in cash to the accused. Further loan agreement dt. 19.02.2016 was also executed between the parties alongwith receipt signed by the accused. That after availing the loan, accused failed to to pay the interest amount thereafter complainant demanded from accused for repayment of the loan amount after the expiry of tenure. Thereafter, accused approached to complainant to settle the matter and agreed to pay Rs. 9,10,000/- against the total outstanding of Rs. 9,15,750/-. Thereafter, in discharge of his partial liability, accused issued a cheque bearing no. 938377 dt. 16.09.2019 for a sum of Rs.
8,10,000/- drawn on Syndicate Bank, Branch-DTC Depot, Ambedkar Nagar (hereinafter referred as cheque in question). That when complainant presented the abovesaid cheque in question for encashment, same was returned unpaid with remarks "Funds Insufficient" vide return memo dt. 20.09.2019. Thereafter, the Digitally signed by NITIN NITIN SHAH CC No. 4069/2020 (Nitin SHAHShah) Date:
2025.10.15 15:46:45 +0530 Om Prakash Aggarwal vs. Harish Chander Page no 2 of 20 JMFC-05 (NI Act)/South DLST020523312019 complainant issued a legal demand notice dated 14.10.2019, calling upon the accused to pay the amount of the aforesaid cheque within the stipulated period but the accused did not make the payment within the statutory period.
PROCEEDINGS BEFORE COURT
3. The complainant tendered his evidence by way of affidavit and relied upon following evidences: -
a) Loan agreement dt. 19.02.2016 Ex. CW1/1
b) Acknowledgment receipt Ex. CW1/2
c) Demand promissory note Ex. CW1/3
d) Cheque in question Ex. CW1/4 e) Return Memo Ex. CW1/5
f) Legal demand notice dt. 14.10.2019 Ex. CW1/6
g) Postal receipts & return envelope Ex. CW1/7, CW1/8 & CW1/10 h) Tracking report Ex. CW1/9
i) Evidence Affidavit Ex. CW1/X
j) Copy of ITR for assessment year 2016-2017, Ex. CW1/X1, CW1/X2 & 2017-2018 and 2018-2019 CW1/X3
4. Upon appreciation of pre-summoning evidence, accused was summoned for an offence punishable under Section 138 of NI Act and notice under Section 251, Code of Criminal Procedure, 1973 (herein after referred to as Cr.P.C.) was served upon accused on 14.12.2021 to which he pleaded not guilty and Digitally signed NITIN by NITIN SHAH Date: SHAH 2025.10.15 15:46:50 +0530 CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 3 of 20 JMFC-05 (NI Act)/South DLST020523312019 claimed trial. The accused has taken the defence that complainant is engaged in a committee/chit fund business and he was also having the committee with the complainant for an amount of Rs. 5.50 lacs. He further deposed that committee was prized and he had received the amount of committee and at that time complainant asked for a blank signed cheque for security purpose. He further deposed that complainant also got his signatures on some blank papers and he had paid all the installments towards the committee and asked for returning the cheque, however complainant delayed the same on one pretext or another. He further deposed that cheque in question was misused by the complainant and he has no liability towards the complainant.
5. Thereafter, application under Section 145 (2) of NI Act of accused was allowed vide order dated 14.12.2021 and the accused was granted opportunity to cross examine the complainant as well as his witnesses, if any.
6. The complainant has only examined himself as CW-1. In the post summoning evidence, the complainant (CW1) has adopted his pre-summoning evidence. The complainant was examined by the Ld. Counsel for accused. CE was closed vide order dated 05.12.2024.
7. Accused was, thereafter, examined U/s 281 r/w Sec 313 Criminal Procedure code, 1872 on 21.09.2024 wherein entire incriminating evidence was put to him. The accused took defence that he has no liability towards the cheque in Digitally question. signed by NITIN NITIN Date:
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8. Accused in his defence has only examined Sh. Shankar Chugh as DW-
1. Thereafter, the defence evidence was closed vide order dt. 18.09.2025 and the matter was fixed for final arguments.
9. I have considered the rival submissions of the parties and perused the entire evidence led by the parties and the material available on record.
FINAL ARGUMENTS
10. During the course of final arguments, complainant argued that all the essential ingredients of section 138 NI Act are fulfilled and there exists enforceable liability towards the complainant on behalf of the accused as the complainant has able to prove all the ingredients of 138 NI Act. Moreover, nothing adverse has been elicited in the cross-examination of the complainant. Thus, lastly prayed that the accused be convicted of the offence.
11. Per contra, Ld. Counsel for the accused has contended that complainant has not shown loan amount in income tax return. It is further submitted that complainant has not been able to prove his financial capacity to advance loan and complainant running money lending business without any licence. It is also submitted that the complainant was running committee business and cheque in question was given as security for the same and accused had also given blank signed papers to the complainant which have been misused by the complainant. Thus, it is prayed that the accused be acquitted of the offence.Digitally signed
NITIN by NITIN SHAH Date: SHAH 2025.10.15 15:47:01 +0530 CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 5 of 20 JMFC-05 (NI Act)/South DLST020523312019 INGREDIENTS OF OFFENCE UNDER SECTION 138 NI ACT AND DISCUSSION
12. Before delving into discussion over the facts of the present case, it would be apposite to discuss the legal standards required to be met by both sides in trial of offence under Section 138 NI Act. In Gimpex Private Limited vs. Manoj Goel (2022) 11 SCC 705 (Decided on October 08, 2021) Hon'ble Supreme Court has divided the ingredients forming the basis of the offence un- der Section 138 of the NI Act in the following structure:
1) The drawing of a cheque by person on an account main-
tained by him with the banker for the payment of any amount of money from that account to another person;
2) The cheque being drawn for the discharge in whole or in part of any debt or other liability;
3) Presentation of the cheque to the bank arranged to be paid from that account,
4) The return of the cheque by the drawee bank as unpaid ei- ther because the amount of money standing to the credit of that account is insufficient to honour the cheque or that it ex- ceeds the amount.
5) A notice by the payee or the holder in due course making a demand for the payment of the amount to the drawer of the Digitally signed by NITIN NITIN Date:
SHAH SHAH 2025.10.15 15:47:05 +0530 CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 6 of 20 JMFC-05 (NI Act)/South DLST020523312019 cheque within 30 days of the receipt of information from the bank in regard to the return of the cheque; and
6) The drawer of the cheque failing to make payment of the amount of money to the payee or the holder in due course within 15 days of the receipt of the notice.
13. The accused can be held guilty of the offence under Section 138 NI Act only if the above-mentioned ingredients are proved by the complainant co- extensively. Moreover, conditions stipulated under Section 142 NI Act have to be fulfilled in addition to above-mentioned ingredients. Hence, unless all the above ingredients are fulfilled in a trial under Section 138 NI Act, accused can- not be held liable.
14. It is pertinent from the pleadings and evidence adduced by the par- ties that there is no dispute qua the proof of first, third and fourth ingredi- ent. The complainant had proved the original cheque vide Ex. CW1/4 which the accused had not disputed as being drawn on the account of the accused. It was not disputed that the cheque in question was presented within period of validity. The cheque in question was returned unpaid vide return memo Ex. CW1/5 with the remarks 'Funds Insufficient'. The said reason is duly covered within the scheme of NI Act. Moreover, these are admitted by the accused under section 294 CrPC at the time of framing of notice. Therefore, requirement of first, third and fourth ingredients stand fulfilled in the present matter.
Digitally signed by NITIN NITIN Date:
SHAH SHAH 2025.10.15 15:47:12 +0530 CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 7 of 20 JMFC-05 (NI Act)/South DLST020523312019 With Respect To fifth and sixth Ingredient:
15. In case of CC Alavi Haji Vs. Palapetty Muhammed (2007)6 SCC555 Hon'ble Supreme Court has held that giving a legal notice to the drawer before filing of complaint under Section 138 of NI Act is a mandatory require-
ment. As far as proof of fifth and sixth ingredient is concerned, the complainant sent a legal demand notice to the accused on 14.10.2019 and also filed speed postal receipts (Ex. CW1/7 & CW1/8). In view of the presumption u/s 27 of the General Clauses Act, 1897, Ex.CW1/6 and Ex.CW1/9 (legal notice, postal re- ceipts and tracking report) alongwith the ratio laid down in the case of "C. C. Alavi Haji Vs. Palapetty Mohd. & Anr (supra), I am of the considered opinion that the fifth and sixth ingredient of the offence stands proved.
RAISING OF PRESUMPTION
16. The accused has admitted his signatures upon the cheque in question in his statement at the time of framing of notice u/s 251 CrPC.
17. As per the scheme of the NI Act, once the accused admits signature on the cheque in question, certain presumptions are drawn, which result in shifting of onus. Section 118(a) of the NI Act lays down the presumption that every negotiable instrument was made or drawn for consideration. Another presumption is enumerated in Section 139 of NI Act laying down the presumption that the holder Digitally signed by NITIN NITIN SHAH SHAH Date:
2025.10.15 15:47:18 +0530 CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 8 of 20 JMFC-05 (NI Act)/South DLST020523312019 of the cheque received it for the discharge, in whole or part, of any debt or other liability.
18. The combined effect of these two provisions is a presumption that the cheque was drawn for consideration and given by the accused for the discharge of debt or other liability. Both the sections use the expression "shall", which makes it imperative for the court to raise the presumptions, once the foundational facts required for the same are proved. Reliance is placed upon the judgment of the Hon'ble Supreme Court, Hiten P. Dalal vs. Bratindranath Banerjee, Kumar Exports vs. Sharma Carpets (2009) 2 SCC 513 and Bir Singh vs. Mukesh Kumar (2019) 4 SCC 197.
19. Therefore, in the instant case, since the accused has admitted his signatures on the cheque in question, the aforementioned statutory presumptions would be raised in favour of the complainant regarding the fact that the impugned cheque has been drawn for consideration and issued by the accused in discharge of legally enforceable debt.
APPRECIATION OF EVIDENCE QUA SECOND INGREDIENT (Existence of Legally enforceable debt/liability as per the cheque amount)
20. Once the execution of the cheque is admitted, a presumption arises under Section 139 of the NI Act that it was issued for discharge of a debt or liability. This presumption is rebuttable, and the accused must raise a probable defence based on the standard of preponderance of probabilities. The accused may Digitally signed NITIN by NITIN SHAH Date: SHAH 2025.10.15 15:47:24 +0530 CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 9 of 20 JMFC-05 (NI Act)/South DLST020523312019 do so using his own evidence or even the complainant's material, and such inference can also be drawn from surrounding circumstances. The principles pertaining to the presumptions and the onus of proof were recently summarized by the Hon'ble Apex Court in Basalingappa vs. Mudibasappa (2019) 5 SCC.
21. In this case, the accused has raised following defences to rebut the statutory presumption:
(a) Non-disclosure of loan amount in income tax return.
(b) The complainant has not been able to prove his financial capacity to advance loan.
(c) The complainant running money lending business without any licence.
(d) The complainant was running committee business and cheque in question was given as security for the same.
22. The aforesaid contentions are discussed hereinafter:
(a) Non-disclosure of loan amount in income tax return.
23. The accused has raised the defence that the transaction as alleged by the complainant is not reflected in his income tax return and the complainant has admitted the same in his cross-examination. Conversely, Ld. Counsel for the complainant has rebutted it is not mandatory to show in ITR, loan given to anyone for the purpose of complaint case u/s 138 NI Act.
Digitally signed by NITIN NITIN Date:
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24. In this regard, Hon'ble Supreme Court in a recent judgment of SANJABIJ TARI Vs. KISHORE S. BORCAR & ANR. 2015 INSC 1158 has held that:
"19. Recently, the Kerala High Court in P.C. Hari vs. Shine Varghese & Anr., 2025 SCC OnLine Ker 5535 has taken the view that a debt created by a cash transaction above Rs. 20,000/- (Rupees Twenty Thousand) in violation of the provisions of Section 269SS of the Income Tax Act, 1961 (for short 'IT Act, 1961') is not a 'legally enforceable debt' unless there is a valid explanation for the same, meaning thereby that the presumption under Section 139 of the Act will not be attracted in cash transactions above Rs. 20,000/- (Rupees Twenty Thousand).
20. However, this Court is of the view that any breach of Section 269SS of the IT Act, 1961 is subject to a penalty only under Section 271D of the IT Act, 1961. Further neither Section 269SS nor 271D of the IT Act, 1961 state that any transaction in breach thereof will be illegal, invalid or statutorily void. Therefore, any violation of Section 269SS would not render the transaction unenforceable under Section 138 of the NI Act or rebut the presumptions under Sections 118 and 139 of the NI Act because such a person, assuming him/her to be the payee/holder in due course, is liable to be visited by a penalty only as prescribed. Consequently, the view that any transaction above Rs.20,000/- (Rupees Twenty Thousand) is illegal and void and therefore does not fall within the definition of 'legally enforceable debt' cannot be countenanced. Accordingly, the conclusion of law in P.C. Hari (supra) is set aside."
(emphasis supplied) Digitally signed by NITIN NITIN Date:
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25. Therefore, in view of the aforesaid judgment, non-disclosure of the loan in the ITR by the complainant to show the transfer of amount is not fatal to the case of the complainant.
Contention no. (b)- Failure to prove financial capacity by the complainant.
26. Another defence raised by the accused is that the complainant has failed to prove his financial capacity to lend amount of Rs. 5,50,000/- as alleged in the complaint.
27. In this regard, reliance may be placed on Tedhi Singh Vs. Narayan Dass Mahant (2022) 4 SCR 442, wherein it has been held that:
"9. The Trial Court and the First Appellate Court have noted that in the case under Section 138 of the N. I. Act the complainant need not show in the first instance that he had the capacity. The proceedings under Section 138 of the N. I. Act is not a civil suit. At the time, when the complainant gives his evidence, unless a case is set up in the reply notice to the statutory notice sent, that the complainant did not have the wherewithal, it cannot be expected of the complainant to initially lead evidence to show that he had the financial capacity. To that extent the Courts in our view were right in holding on those lines. However, the accused has the right to demonstrate that the complainant in a particular case did not have the capacity and therefore, the case of the accused is acceptable which he can do by producing independent materials, namely, by examining his witnesses and producing documents. It is also open to Digitally signed by NITIN NITIN Date:
SHAH SHAH 2025.10.15 15:48:56 +0530 CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 12 of 20 JMFC-05 (NI Act)/South DLST020523312019 him to establish the very same aspect by pointing to the materials produced by the complainant himself. He can further, more importantly, achieve this result through the cross examination of the witnesses of the complainant. Ultimately, it becomes the duty of the Courts to consider carefully and appreciate the totality of the evidence and then come to a conclusion whether in the given case, the accused has shown that the case of the complainant is in peril for the reason that the accused has established a probable defence." (emphasis supplied)
28. Further, in case of APS FOREX SERVICES PVT. LTD. vs. SHAKTI INTERNATIONAL FASHION LINKERS & ORS. AIR 2020 SC 945 it was held that :
"..........We are of the view that whenever the accused has questioned the financial capacity of the complainant in support of his probable defence, despite the presumption under Section 139 of the N.I. Act about the presumption of legally enforceable debt and such presumption is rebuttable, thereafter the onus shifts again on the complainant to prove his financial capacity and at that stage the complainant is required to lead the evidence to prove his financial capacity, more particularly when it is a case of giving loan by cash and thereafter issuance of a cheque. ...."(emphasis supplied)
29. Thus, it emerges from the above cases is that u/s 138 NI Act, the complainant is not obliged to prove his financial capacity. However, if he claims to have lent money in cash and the accused challenged his ability to do so, the complainant must, then, demonstrate his financial capacity or the source of the Digitally signed by NITIN NITIN SHAH SHAH Date:
2025.10.15 15:49:01 +0530 CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 13 of 20 JMFC-05 (NI Act)/South DLST020523312019 funds. The burden arises only when the accused disputes it; otherwise, no initial proof of financial capacity is required.
30. In the instant case, the complainant has alleged that he gave the accused Rs. 5,50,000/- on 19.02.2016 for a maximum period of 3 years. The accused has disputed financial capacity of the complainant in cross-examination of the complainant.
31. During the cross-examination of the complainant by the counsel for the accused, he was asked regarding his income. The complainant stated that at the time of filing the present complaint, his income ranged between Rs. 8 lakhs to Rs. 10 lakhs, which was also reflected in his Income Tax Returns (ITRs). He further stated that such income was derived from his shop as well as rental income.
However, no documentary proof of income was initially produced. Notwithstand- ing, the complainant asserted his ability to produce the relevant ITRs for the con- cerned assessment periods to establish the gross income. Thus, during the cross-ex- amination held on 05.08.2022, the complainant produced the Income Tax Returns for the assessment years 2016-17 to 2018-19, marked as Exhibits CW-1/X1 to CW- 1/X3. As per the aforementioned Income Tax Returns, the complainant's Gross To- tal Income for the Assessment Year 2016-17 was Rs. 7,09,715/-; for the Assess- ment Year 2017-18, it was Rs. 8,13,836/-; and for the Assessment Year 2018-19, it was Rs. 8,27,878/-. These figures substantiate that the complainant had sufficient income during the relevant period when the alleged loan was advanced.
Digitally
signed by
NITIN
NITIN SHAH
SHAH Date:
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32. Furthermore, the complainant has stated that the loan amount was ad- vanced in cash, which was withdrawn from his savings. In addition, the com- plainant was also cross-examined with regard to his day-to-day expenses and his ability to maintain his family, to which he provided satisfactory responses. It is per- tinent to note that the counsel for the accused did not ask the complainant as to his bank statements of relevant period during cross-examination, nor was any question posed to challenge the complainant's financial capacity for establishing whether any cash withdrawal was, in fact, made for the purpose of advancing the alleged loan.
33. Hence, from the foregoing analysis, it emerges that the counsel for the accused had challenged the complainant's capacity to advance a cash loan, thereby shifting the burden upon the complainant to establish his financial capability. The complainant, however, has successfully discharged this burden by satisfactorily proving that he possessed the requisite financial capacity to advance the loan in question.
Contention no. (c) The complainant running money lending business without any licence.
34. It has been also argued by Ld. Counsel for the accused that it is admitted by the complainant in his cross-examination that he did not have any licence to advance money.
35. In this regard, it has been held by Hon'ble Delhi High court in Hansraj Bansal Vs. State & another CRL. M. A. 10831/2019 that:
"Had it been a money suit instituted by the money lender for Digitally signed NITIN by NITIN SHAH Date:
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the recovery of the loan advanced by him together with interest and for accounting all these submissions would have been relevant. In a criminal proceeding u/s 138 NI Act these are not relevant at all. In the instant matter a magistrate is to consider whether the offence as alleged was committed or not and whether evidence is sufficient to prove complainant's case. Legality or illegality of the contract and existence and nonexistence of money lending business by the complainant is not a ground to throw the complainant's case out of the court.........
The accused remedy only to lead evidence by examining witnesses and producing documents to prove that there was no transaction with complainant or that he did not issue any cheque in favour of the complainant and that there was no existing debt or liability at the time of his entering into defence and leading his evidence."(emphasis supplied)
36. Thus, in proceedings under Section 138 of the NI Act, the court is only concerned with whether a cheque was issued for a legally enforceable debt and whether it was dishonoured. The complainant's money-lending license is not relevant. Thus, the defence taken by the accused, that a friendly loan was given without a money-lending licence, is not a valid ground.
Contention no. (d) The complainant was running committee business and cheque in question was given as security for the same.
37. Accused has also raised the defence that the cheque in question was given in a committee as a security. Further, at the time of framing of notice under Section 251 CrPC, the accused took the defence that the complainant was engaged in committee/chit fund business and that the accused was also a participant in a Digitally signed NITIN by NITIN SHAH Date: SHAH 2025.10.15 15:49:22 +0530 CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 16 of 20 JMFC-05 (NI Act)/South DLST020523312019 committee of ₹5,50,000/- with the complainant. It was stated that the accused had received the amount due to him from the said committee, and at that time, the complainant asked him to hand over a signed blank cheque for security purposes. Pursuant to this request, the accused handed over a cheque as security. It was fur- ther submitted that the accused had already paid all the installments due under the committee. Thereafter, when the accused demanded return of the said cheque, the complainant, on one pretext or the other, avoided returning the same and subse- quently misused the cheque by filing the present complaint. In addition to it, the ac- cused also reiterated this version of events in his statement recorded under Section 313 CrPC.
38. In order to substantiate his defence, the accused examined one Shankar Chugh as DW-1. It is pertinent to note that during his cross-examination, the complainant himself stated that he came into contact with the accused through said Shankar Chugh. In his deposition, DW-1 stated that the complainant was engaged in the business of running committees (chit funds) and used to visit his shop. The complainant had also informed him that he was going to start a new committee and invited him to become a member. However, the said witness declined to join and was instead asked by the complainant to help arrange other members. The witness further deposed that one day when the accused visited his shop, he informed the accused about the said committee. A few days thereafter, the complainant informed him that the accused had joined the said committee. Further- more, the said witness supported the defence version of the accused with regard to the handing over of the cheque.
Digitally signed by NITIN NITIN Date:
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39. It is, however, pertinent to note that the allegation regarding the handing over of two blank signed cheques and a blank signed paper was based solely on what the accused had told the witness; the said witness did not witness the actual handing over of the documents. Moreover, the said witness has not deposed to any fact suggesting that there did not exist any other transaction between the complainant and the accused apart from the said committee.
40. Even if it is assumed that the accused was a part of the committee with the complainant, that by itself does not prove that the cheque in question was issued in relation to the said committee, particularly in the absence of any documentary evidence produced by the accused on record to substantiate the same.
41. It is further relevant to note that the loan agreement Ex. CW-1/1, the receipt Ex. CW-1/2, and the promissory note Ex. CW-1/3, which are part of the record, bear the signatures of the accused, and the same have been admitted by him under Section 294 CrPC. The stamp paper on which the said loan agreement was executed was also purchased by the accused himself. Though the accused has taken the plea that he had signed blank papers, a perusal of the documents in question does not support such a contention, as the accused's signatures appear at different places on each of the documents, indicating that the documents were not prepared by misusing blank signed papers. It is also pertinent that no complaint whatsoever has been filed by the accused against the complainant alleging misuse of any blank signed papers or cheques.
Digitally
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NITIN
NITIN SHAH
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42. It was further argued that if the loan amount was ₹5,50,000/-, then the cheque should have been presented only for that amount and no claim could be made in excess thereof. In this regard, it is relevant to note that as per the terms of the loan agreement, the said amount was advanced to the accused for a period of 36 months at an interest rate of 1.75% per month. Accordingly, the amount mentioned in the cheques in question reflects the existing liability of the accused including the applicable interest.
43. In view of the above discussion, it is evident that the accused has failed to produce any cogent or reliable documentary evidence to establish that the cheque in question was issued solely for committee-related transactions. The testimony of DW-1 is largely based on hearsay and does not support the accused's plea of having handed over blank signed cheques and papers for security purposes. The admitted signatures of the accused on the loan agreement, receipt, and promissory note, coupled with the absence of any complaint regarding alleged misuse of documents, further weakens the defence. The presence of different signatures on separate documents also negates the plea of signing blank papers. Accordingly, the accused has failed to prove the defence raised by him.
44. Hence, in the light of above discussions and the authorities cited in the aforegoing para(s), the accused has failed in establishing a probable defence on standard of preponderance of probabilities to rebut the presumption under section 118 and 139 NI Act. The accused have, thereby, failed to prove that the cheque was not given in discharge of existing legal debt or liability. Thus, the second ingredient to the offence under section 138 of NI Act stands proved. Digitally signed by NITIN NITIN Date:
SHAH SHAH 2025.10.15 15:50:14 +0530 CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 19 of 20 JMFC-05 (NI Act)/South DLST020523312019 CONCLUSION:
45. In the result of the analysis of the present case, the accused Harish Chander is hereby convicted of the offence punishable under Section 138, Negotiable Instruments Act, 1881.
46. This judgment contains 20 pages. This judgment has been signed and pronounced by the undersigned in open court.
47. Copy of this Judgment be given dasti free of cost as per rules.
48. Let a copy of the judgment be uploaded on the official website of District Courts, South, Saket forthwith.
49. The convict has a right to suspension of sentence as per the statutory period and to prefer an appeal against the present judgment. He is also at liberty to avail the services of District Legal Services Authority, South as per entitlement in case she cannot afford the professional fee of an advocate. The contact details of the authority have been mentioned on the cover note of this judgment.Digitally signed by NITIN
NITIN SHAH Date:
SHAH 2025.10.15 15:50:19 +0530 Announced in the open Court (NITIN SHAH) on 16.10.2025 JMFC-05 (NI ACT) SOUTH/SAKET NEW DELHI CC No. 4069/2020 (Nitin Shah) Om Prakash Aggarwal vs. Harish Chander Page no 20 of 20 JMFC-05 (NI Act)/South