Delhi District Court
S. Jasbir Singh Chawla vs Satvinder Singh on 30 March, 2026
THE COURT OF MS. SURABHI SETHI
JUDICIAL MAGISTRATE FIRST CLASS (NI ACT- 02),
WEST DISTRICT, TIS HAZARI COURTS, NEW DELHI
S. Jasbir Singh Chawla
S/o Late Sh. Bahadur Singh Chawla
R/o AE-10, Tagore Garden
New Delhi-110027 ..... Complainant
Vs.
Satvinder Singh
S/o Late Sardar Singh
R/o A-250, 2nd Floor,
Vikaspuri, New Delhi-18
2nd Address:
3rd Floor, 31, Motia Khan Dump Scheme,
Rani Jhansi Road, Jhandewalan,
New Delhi ..... Accused
Complaint Case number : 1556/2018
Date of Institution of Complaint : 28.02.2018
Offence Complained of : Section 138 NI Act
Plea of Accused : Not Guilty
Final order : Conviction
Date of Decision : 30.03.2026
Digitally
signed by
SURABHI
SURABHI SETHI
SETHI Date:
2026.03.30
15:41:53
+0530
1
CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh
JUDGMENT
1. The present complaint has been filed by S. Jasbir Singh Chawla, (hereinafter referred to as 'complainant'), against Satvinder Singh (hereinafter referred to as 'accused'), under Section 138 of Negotiable Instruments Act, 1881 (hereinafter referred to as 'NI Act') for dishonour of cheques bearing numbers 044607 and 313264, both dated 17.01.2018, for an amount of Rs. 50,00,000/- and Rs. 25,00,000/- respectively, both drawn on Axis Bank Ltd., Jhandewalan Extension, New Delhi-110055 (hereinafter referred to as the 'cheques in question').
A. BRIEF FACTS:-
2. (a) The complainant has alleged that the accused is the owner of portion of the built-up property on plot no. 31, area measuring 277.75 sq. yards, situated at Motia Khan Dump Scheme, New Delhi, now known as Mauja Jhandewalan, Karol Bagh, New Delhi-110005, Khasra No. 72-75-189/35-188/19/333 with leasehold rights of the land under the said property (hereinafter referred to as the "property in question"). It is further alleged that due to his legal requirements, the accused had agreed to sell, transfer and convey his rights, interests, liens and titles of the 1/5th undivided share of portion of the property in question to the complainant for a total sale consideration of Rs. 1,50,00,000/- and an agreement to sell and purchase was executed between the parties. It is further alleged that on the same day, the accused executed a MoU dated 09.09.2016 because of clause 20 of the agreement to sell and purchase. It is further alleged that the complainant gave a sum of Rs. 10,00,000/- to the accused vide cheque no. 558722 dated 27.05.2016, payable at Axis Bank, Vishal Enclave, New Delhi and a sum of Rs. 1,40,00,000/- in cash. It is further alleged that the accused failed to execute the title documents of the property in question and hand over its possession to the complainant and also did not return the Digitally signed by SURABHI SURABHI SETHI 2 SETHI Date:
CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh 2026.03.30 15:41:57 +0530 amount of Rs. 1,50,00,000/- to the complainant. It is further alleged that as per the MoU dated 09.09.2016, the aforesaid amount was lying with the accused as a loan given by the complainant and that it was agreed between the parties that the accused would pay Rs. 1,00,000/- per month from 09.09.2016 as interest to the complainant. It is further alleged that the accused paid interest for two months only, i.e., upto 08.11.2016 and is liable to pay interest with effect from 09.11.2016. It is further alleged that the accused gave Rs. 25,00,000/- on 17.03.2017 and Rs. 48,00,000/- on 03.05.2017 to the complainant and that he is under an obligation to pay the remaining amount of Rs. 77,00,000/- and a further amount of Rs. 15,00,000/- as interest for 15 months to the complainant.
It is further alleged that in partial discharge of this liability and for the part payment of the amount, the accused issued the cheques in question (Ex. CW- 1/2 and Ex. CW-1/3) to the complainant and the same were dishonoured upon presentation, vide return memos dated 19.01.2018 (Ex. CW-1/4 and Ex. CW- 1/5) with remarks "Insufficient Funds".
(b) Thereafter, the complainant sent a legal demand notice dated 01.02.2018 (Ex. CW-1/6) to the accused through his Counsel. However, the accused allegedly failed to pay the cheque amount within the statutory period, despite such notice, and therefore, the present complaint has been filed.
3. The accused has admitted his signatures on the cheques in question and the issuance of the same to the complainant. However, the stance of the accused is that he had a property deal with the complainant which did not materialize and he returned the money to the complainant and obtained three cheques which were lying with the complainant. The accused has alleged that the complainant thereafter requested him to help in purchasing a property and to show his financial capacity, for which he had given Rs. 25,00,000/- on 17.03.2017 and Rs. 48,00,000/- on 03.05.2017 by RTGS and the cheques in question as blank signed cheques to the complainant for the said purpose. He has further alleged Digitally signed by SURABHI SURABHI SETHI 3 SETHI Date:
CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh 2026.03.30 15:42:01 +0530 that the said blank cheques were alleged to have been lost and the same have been misused by the complainant and that he owes no liability towards the complainant. The accused has admitted the receipt of legal demand notice from the complainant.
B. PRE-SUMMONING EVIDENCE AND NOTICE:-
4. At the stage of pre-summoning evidence, the complainant examined himself as CW-1 and led his evidence by way of affidavit Ex. CW-1/A. The complainant relied upon documents Ex. CW-1/1 to Ex. CW-1/8 in his pre- summoning evidence. Upon finding a prima facie case, the accused was summoned to face trial vide order dated 09.03.2018. On entering appearance, the accused was served with the notice of accusation under Section 251, Code of Criminal Procedure, 1973 (hereinafter referred to as 'Cr.P.C.') on 23.10.2018, to which he pleaded not guilty and claimed trial. Thereafter, the accused moved an application under Section 145(2), NI Act, which was allowed and the accused was permitted to cross-examine the complainant and his witnesses, if any, vide the order of even date.
C. COMPLAINANT'S EVIDENCE:-
5. During the trial, the complainant was duly examined, cross-examined and discharged. The following oral and documentary evidence was led by the complainant to prove his case against the accused beyond reasonable doubt.
ORAL EVIDENCE CW-1 S. Jasbir Singh Chawla (tendered his evidence by way of affidavit) DOCUMENTARY EVIDENCE Ex. CW-1/1 MoU dated 09.09.2016 Digitally signed by 4 SURABHI CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh SURABHI SETHI SETHI Date:
2026.03.30 15:42:05 +0530 Ex. CW-1/2 Original cheque bearing no. 044607, dated 17.01.2018, for Rs. 50,00,000/-
Ex. CW-1/3 Original cheque bearing no. 313264, dated 17.01.2018, for Rs. 25,00,000/-
Ex. CW-1/4 and Ex. CW-1/5 Return memos dated 19.01.2018 Ex. CW-1/6 Legal Demand Notice dated 01.02.2018 Ex. CW-1/7 Original Postal Receipts and Courier Receipts Ex. CW-1/8 AD Card Ex. CW-1/A1 Ledger Account from 01.04.2016 to 03.05.2016 Mark X Photocopies of three cheques returned by the complainant to the accused D. STATEMENT OF ACCUSED:-
6. Thereafter, in order to allow the accused to personally explain the circumstances appearing in evidence against him, his statement under Section 313, Cr.P.C. was recorded without oath.
E. DEFENCE EVIDENCE:-
7. Thereafter, the accused opted to lead defence evidence. The following oral and documentary evidence was led on behalf of the accused in support of his defence.
ORAL EVIDENCE DW-1 Sh. Daleep Rai Digitally signed by 5 SURABHI CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh SURABHI SETHI SETHI Date:
2026.03.30 15:42:08 +0530 DW-2 Sh. Tejinder Kumar Nagpal DW-3 Sh. Prateek Kumar DW-4 Sh. Satvinder Singh DOCUMENTARY EVIDENCE Ex. DW-1/A Sale Deed dated 01.05.2018 Ex. CW-1/R1 Agreement to sell and purchase dated 27.05.2016 Ex. CW-1/R2 Receipt dated 27.05.2016 Ex. CW-1/R3 Agreement to sell and purchase dated 09.09.2016 Ex. CW-1/R4 (colly) Receipt, GPA, SPA, Affidavit, Indemnity Bond and Will Ex. CW-1/R5 Agreement to appoint arbitrator dated 09.09.2016 Ex. CW-1/R6 Reply dated 19.02.2018 to the legal demand notice
8. Thereafter, the matter was listed for final arguments. I have heard the learned counsels on both the sides and have perused the file and given my thoughtful consideration to the material on record.
9. Ld. Counsel for the complainant has argued that the complainant has proved his case beyond reasonable doubt and the accused has failed to lead any probable defence to rebut the presumptions under Section 139 and Section 118(a) of NI Act. Accordingly, he has argued that the accused be convicted for the offence punishable under Section 138, NI Act. Digitally signed by SURABHI SURABHI SETHI SETHI Date:
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10. Per contra, Ld. Counsel for the accused has argued that the complainant has filed a false and frivolous complaint against the accused. He has argued that there was an agreement to sell between the parties for a total sale consideration of Rs. 9,00,00,000/-, of which the complainant had paid Rs. 1,00,00,000/- to the accused, however, the agreement subsequently stood cancelled. He has further argued that there was a subsequent loan agreement /MoU dated 09.09.2016 between the parties and that the accused has already repaid the entire loan amount of Rs. 1,50,00,000/- to the complainant in cash and upon discharging his liability, three cheques of Rs. 50,00,000/- each, given to the complainant by the accused as security in terms of the MoU, were also returned by the complainant to the accused. He has further argued that the complainant subsequently sought help from the accused for the purchase of a different property, as he wanted to show his financial capacity to the person from whom he intended to buy such property and for the said purpose, the accused had given Rs. 73,00,000/- and the cheques in question as blank signed cheques to the complainant, which have been misused by him. Lastly, he has argued that the cheques in question were not issued to the complainant in discharge of any legally enforceable debt/liability and hence, the accused owes no liability towards him and be acquitted of the offence under Section 138, NI Act.
F. INGREDIENTS OF OFFENCE AND DISCUSSION:-
11. Before delving into the facts of the present case, it is essential to examine the law governing the offence under Section 138, NI Act. Bare reading of the provision shows that in order to establish the offence under Section 138, NI Act, the complainant must establish the following ingredients:
i. Cheque is drawn by the accused on an account maintained by him with a banker for payment of any amount of money to another Digitally signed by SURABHI SURABHI SETHI SETHI Date:
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CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh
person for discharge, in whole or in part, of any debt or other liability.
ii. The debt or other liability against which the cheque was issued is legally enforceable.
iii. Said cheque is returned unpaid by the bank either due to insufficiency of funds in the account of the accused to honour the cheque or because it exceeds the amount arranged to be paid from that account by an agreement made with that bank.
iv. The cheque must have been presented to the bank within a period of 03 months from the date on which it is drawn or within the period of its validity.
v. A demand of the said amount is made by the payee or the holder in due course of the cheque by a notice in writing given to the drawer within 30 days of the receipt of information of dishonour from the bank.
vi. Drawer of the cheque fails to make the payment of the said amount to the payee or holder in due course of cheque within 15 days of said notice.
12. In addition to the above, the conditions stipulated under Section 142, NI Act must be fulfilled by the complainant. Therefore, in a complaint under Section 138, NI Act, the complainant is required to prove that the cheque was drawn by the drawer (accused) for the discharge of a legally enforceable debt or other liability.
13. It is a well settled principle of criminal jurisprudence that a criminal trial proceeds on the presumption of innocence of the accused, until proven guilty. Thus, the initial burden to establish the guilt of the accused lies upon the complainant. However, in the trial of an offence under Section 138, NI Act, once the accused admits his signatures on the cheque in question, certain presumptions arise in favour of the complainant under the scheme of the Act. These presumptions result in shifting of onus on the accused. Here, it is apposite to refer to Section 118(a) and Section 139 of the NI Act. Section 118(a) of the Digitally signed by SURABHI 8 CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh SURABHI SETHI SETHI Date:
2026.03.30 15:42:20 +0530 NI Act provides that unless the contrary is proved, a drawn up negotiable instrument, if accepted, has to be presumed to be for consideration. Further, Section 139 of the NI Act provides that unless the contrary is proved, the holder of a cheque shall be presumed to have received the same in discharge of any debt or other liability. Therefore, these two provisions raise a rebuttable presumption in favour of the complainant that the cheques in question were drawn for consideration and were issued by the accused in discharge of a debt or other liability.
14. It was held by Hon'ble Apex Court in Hiten P. Dalai v. Bratindra Nath Bannerjee, (2001) 6 SCC 16, that it is obligatory on the part of the court to raise presumption under Sections 118 and 139 of NI Act in every case where factual basis for raising of the presumption has been established. In Rangappa v. Sri Mohan, (2010) 11 SCC 441, Hon'ble Apex Court held that where the signature on the cheque is acknowledged, a presumption has to be raised regarding the existence of a legally enforceable debt or liability, however, this presumption is of a rebuttal nature and the onus is then on the accused to raise a probable defence.
15. In order to rebut the presumption under Section 139 NI Act, the standard of proof is that of preponderance of probabilities, by which the accused is liable to raise a probable defence. To rebut the presumption, it is open to the accused to rely on evidence led by him/her or to rely on the materials submitted by the complainant or the circumstances upon which the parties rely in order to raise a probable defence (Basalingappa v. Mudibasappa, (2019) 5 SCC 418). Further, it was held by the Hon'ble Supreme Court in Kumar Exports v. Sharma Carpets, (2009) 2 SCC 513 that to rebut the statutory presumption, the accused should bring on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration or debt did not exist, Digitally signed by SURABHI SURABHI SETHI SETHI Date:
2026.03.30 9 CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh 15:42:24 +0530 or their non-existence was so probable that a prudent man, under the circumstances of the case, would act upon the plea that they did not exist.
16. Now, coming to the facts of the present case, it is the case of the complainant that he had agreed to purchase the property in question from the accused and had executed an agreement to sell and purchase dated 09.09.2016 and had paid Rs. 1,50,00,000/- to him. The complainant has alleged that the accused failed to execute the title documents in his favour and the amount of Rs. 1,50,00,000/- was lying with the accused as a loan given by him, as per the MoU dated 09.09.2016 and for the partial repayment of the said amount, the accused had issued the cheques in question in his favour, which were dishonoured upon presentation for encashment. Evidence on record shows that the accused has admitted his signatures on the cheques in question. It is also not in dispute that the cheques in question were presented within the period of their validity and were dishonoured on presentation. The accused has also admitted the receipt of legal demand notice from the complainant in the notice framed against him.
17. The present complaint has been filed within the period of limitation. It is thus clear that factual basis for raising the presumption u/s 118(a) NI Act and Section 139 NI Act is established in the present case. Accordingly, the mandatory presumptions under Section 118(a) and Section 139 of NI Act are raised that the cheques in question were issued in discharge of a legally enforceable debt or other liability.
18. Further, Section 118(g), NI Act also lays down a presumption in favour of the complainant. It states that the holder of the cheque is presumed to be the holder in due course. Hence, the onus now shifts to the accused to rebut the presumptions and to establish a probable defence that the cheques in question (Ex. CW-1/2 and Ex. CW-1/3) were not issued in discharge of any legally Digitally signed by SURABHI SURABHI SETHI SETHI Date:
2026.03.30 10 CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh 15:42:27 +0530 enforceable debt/ liability.
19. The accused has taken the defence that the loan amount of Rs. 1,50,00,000/- advanced under the Memorandum of Understanding dated 09.09.2016 (Ex. CW-1/1) has already been repaid to the complainant. It is contended that the three cheques of Rs. 50,00,000/- each were returned to him upon discharge of his liability. The accused has further submitted that he had transferred amounts of Rs. 25,00,000/- and Rs. 48,00,000/- to the complainant through RTGS, allegedly to assist the complainant in purchasing a property. According to the accused, the said amount of Rs. 73,00,000/-, along with the cheques in question, were handed over to the complainant as blank signed cheques only to enable him to demonstrate his financial capacity. It is alleged that the complainant has misused the said cheques.
20. To substantiate this defence, the accused cross-examined the complainant. During his cross-examination, the complainant admitted the execution of the agreement to sell dated 27.05.2016 (Ex. CW-1/R1) between him and the accused and the receipt dated 27.05.2016 (Ex. CW-1/R2)¸whereby a sum of Rs. 1,00,00,000/- was acknowledged as earnest money. A perusal of Ex. CW-1/R1 reveals that, as per Clause 10, the property was required to be converted from leasehold to freehold by the accused, prior to transfer. However, the complainant denied the suggestion that he had requested the accused to undertake such conversion due to his own inability. He further denied the suggestion that at the time of getting the property converted into free hold, the accused had requested him for a payment of Rs. 39,73,614/- to be made to the concerned Department. He also denied the suggestion that he got the property converted into free hold after the accused made payment of the aforementioned amount. The complainant also denied taking Rs. 10,00,000/- from the accused for the purpose of conversion of the property into free hold.
Digitally signed by SURABHI SURABHI SETHI SETHI Date:
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21. Furthermore, the complainant also admitted the execution of the agreement to sell dated 09.09.2016 (Ex. CW-1/R3) with respect to the property in question (i.e., 20% of the property of the accused), clarifying that the same was executed pursuant to the MoU dated 09.09.2016 (Ex. CW-1/1). He also stated that it was agreed between him and the accused that the accused would himself get the property converted into free hold, in terms of Clause 10 of the agreement to sell dated 27.05.2016 (Ex. CW-1/R1). The complainant deposed that the accused had issued three cheques of Rs. 50,00,000/- each on 09.09.2016 in terms of the MoU and that the same were duly filled and signed by the accused. He also admitted that the details of these cheques were recorded in the MoU. Though the complainant conceded that the said three cheques were subsequently returned to the accused, he categorically denied that the same were returned upon repayment of Rs. 1,50,00,000/- in cash. He further denied receiving any repayment from the accused towards the loan amount. Significantly, the complainant stated that the three cheques were returned only after he received the cheques in question amounting to Rs. 75,00,000/- from the accused. This assertion remained unchallenged by the accused during cross- examination of the complainant.
22. The complainant admitted that the agreement to sell dated 27.05.2016 stood cancelled upon execution of the MoU dated 09.09.2016. Further, Clause 20 of the agreement dated 09.09.2016 (Ex. CW-1/R3) stipulates that the said agreement would come into effect only upon failure of the accused to repay the loan amount by 20.04.2017.
23. It is also an admitted position that the three cheques were returned to the accused prior to March 2017. Although, the complainant subsequently deposed that the cheques were returned to the accused on 03.05.2017, the factum of return of the cheques remains undisputed. Accordingly, the exact date of such return does not assume material significance for the adjudication of the present Digitally signed by SURABHI SURABHI SETHI 12 CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh SETHI Date:
2026.03.30 15:42:36 +0530 case. The complainant further admitted that upon return of the said cheques, the agreement to sell dated 09.09.2016 (Ex. CW-1/R3) also stood cancelled and no subsisting agreement remained between the parties with respect to the property in question. In light of the aforesaid facts, the pivotal issue for determination is whether the accused had repaid the loan amount of ₹1,50,00,000/- advanced under the MoU dated 09.09.2016, or whether there existed a legally enforceable liability subsisting against the accused at the time of issuance of the cheques in question.
24. It is apposite to note that during his cross-examination, the complainant admitted having received two payments of Rs. 25,00,000/- and Rs. 48,00,000/- from the accused through RTGS in his bank account. The complainant, however, clarified that the said payments were made towards partial repayment of the loan amount of Rs. 1,50,00,000/-. The complainant further deposed that all his financial dealings with the accused were duly reflected in his Income Tax Returns, and in support of the same, he placed on record a photocopy thereof (Ex. CW-1/A1).
25. The complainant denied the suggestion that in March 2017, the accused had approached him for repayment of Rs. 1,40,00,000/- in cash towards the loan amount. He admitted that he did not issue any notice to the accused concerning the documents executed for transfer of the property in question or regarding the appointment of an arbitrator. However, he categorically denied the suggestion that such omission was on account of having already received the entire loan amount from the accused. The complainant further stated that the cheques in question were received by him, duly filled, from the accused on 03.05.2017.
26. The accused has further contended in his defence that the payments made by him to the complainant through RTGS were not towards repayment of the loan amount. Rather, it has been alleged that the said payments were in connection with a separate property transaction which the complainant intended Digitally signed by SURABHI 13 CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh SURABHI SETHI SETHI Date:
2026.03.30 15:42:42 +0530 to undertake. However, during the course of cross-examination, the complainant categorically denied the suggestion that the cheques in question and the sum of Rs. 73,00,000/- were handed over to him by the accused in March 2017 at the request of his son in relation to the purchase of another property.
27. In order to substantiate the aforesaid defence, the accused examined Sh. Daleep Rai as a defence witness (DW-1). DW-1 placed on record a photocopy of the sale deed dated 01.05.2018 (Ex. DW-1/A), executed by his sister-in-law, Smt. Anita Raj Kanwar, in favour of the complainant and his son. He deposed that no agreement to sell had been executed prior to the said sale deed, as the property was yet to be converted into freehold. He further stated that no document had been executed between the parties prior to the said transaction. According to DW-1, the first payment of Rs. 70,00,000/- was made by the complainant to his sister-in-law on 23.08.2017. During his cross-examination, DW-1 admitted that the complainant and his son were first introduced to them only 2-3 days prior to the receipt of the first payment on 23.08.2017. The testimony of DW-1 materially undermines the defence set up by the accused. If the negotiations in respect of the property transaction reflected in the sale deed (Ex. DW-1/A) commenced only in August 2017, it appears highly improbable that the payments allegedly made by the accused to the complainant in March and April 2017 were intended to facilitate the complainant in demonstrating his financial capacity for the said transaction. The defence version, therefore, does not inspire confidence and appears to be an afterthought.
28. The accused further examined Sh. Tejinder Kumar Nagpal as DW-2. DW- 2 deposed that he is engaged in the business of property dealing and that the transaction between Smt. Anita Raj Kanwar and the complainant along with his son, as reflected in the sale deed (Ex. DW-1/A), was facilitated by his elder brother, while he merely assisted him in the said transaction. DW-2 admitted his signatures on the aforesaid sale deed as a witness. However, he conceded that Digitally signed by SURABHI SURABHI SETHI SETHI Date:
14CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh 2026.03.30 15:42:46 +0530 no record of the transactions or dealings was maintained by them. He further stated that he was not aware whether any documents had been executed between the parties prior to the execution of the sale deed. The testimony of DW-2 does not materially advance the case of the accused, inasmuch as the witness has expressed lack of knowledge regarding the existence of any prior documentation and has admitted absence of any maintained records. His deposition, therefore, fails to lend substantive support to the defence set up by the accused.
29. The accused further examined Sh. Prateek Kumar as DW-3 in support of his defence. DW-3 deposed that he is engaged in the business of property dealing and that the transaction between the accused and the complainant was facilitated in association with Balaji Properties. He admitted his signatures on the agreement to sell dated 27.05.2016 (Ex. CW-1/R1), the receipt dated 27.05.2016 (Ex. CW-1/R2), as well as the subsequent agreement to sell dated 09.09.2016 (Ex. CW-1/R3). DW-3 further deposed that the subsequent agreement to sell was executed as the subject property was initially leasehold and the accused had undertaken to get the same converted into freehold. He stated that the accused eventually got the property converted into freehold, though the complainant raised certain objections thereafter. The witness categorically denied the suggestion that the complainant had agreed to get the property converted into freehold himself or that he had taken Rs. 10,00,000/-
from the accused for such purpose. He remained consistent in his deposition that the conversion was carried out by the accused through one of his acquaintances, namely Mr. Tyagi.
30. DW-3 further deposed that he was not aware whether the accused had incurred an amount of Rs. 39,73,614/- towards conversion of the property into freehold. He denied the suggestion that the subsequent agreement to sell (Ex. CW-1/R3) was executed by the complainant with the intention of securing Digitally signed by SURABHI SURABHI SETHI 15 CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh SETHI Date:
2026.03.30 15:42:50 +0530 himself. He admitted that at the time of execution of Ex. CW-1/R3, three undated cheques were handed over by the accused to the complainant, though he could not recall whether each cheque was for Rs. 50,00,000/-. He further admitted his signatures on the MoU dated 09.09.2016 (Ex. CW-1/1), but stated that he did not remember its contents. The witness also deposed that he came into contact with the parties after the execution of the agreement (Ex. CW- 1/R3) and the MoU (Ex. CW-1/1), at which stage the complainant had paid an additional sum of Rs. 50,00,000/- to the accused, which was duly acknowledged by way of a receipt.
31. During his cross-examination, DW-3 admitted that a further sum of Rs. 50,00,000/- was paid by the complainant to the accused vide the receipt (Ex. CW-1/R4) and he acknowledged his signatures on the said receipt. He also conceded that all documents between the parties were executed after reading and understanding of their contents. The testimony of DW-3, instead of supporting the defence, lends corroboration to the case of the complainant. The witness has admitted the execution of all material documents, including the agreements, receipts, and the MoU. He has also acknowledged the handing over of three cheques by the accused to the complainant at the time of execution of the subsequent agreement. Further, the admission regarding payment of an additional sum of Rs. 50,00,000/- by the complainant to the accused strengthens the financial transaction between the parties and supports the existence of a legally enforceable liability. The inability of the witness to recall material details, coupled with his admission that all documents were executed after due understanding, diminishes the credibility of the defence version.
32. The accused examined himself as DW-4 in support of his defence. He deposed that he had entered into the agreement to sell dated 27.05.2016 (Ex. CW-1/R1) with the complainant for a total sale consideration of Rs. 9,00,00,000/-. Out of the said amount, the complainant allegedly paid Rs.
Digitally
signed by
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SURABHI SETHI 16
SETHI Date:
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10,00,000/- by cheque and Rs. 90,00,000/- in cash as advance. He further deposed that the complainant had assured payment of the remaining consideration within four months as well as the conversion of the property into freehold. The accused further stated that he had received a notice from the DDA requiring deposit of Rs. 40,00,000/- for conversion of the property; however, he was unable to recall whether the said notice was received prior to or subsequent to the execution of the agreement dated 09.09.2016 (Ex. CW-1/R3). He admitted the execution of the MoU dated 09.09.2016 (Ex. CW-1/1) and acknowledged receipt of Rs. 50,00,000/- in cash from the complainant on the said date. He also deposed that in November 2016, he had approached the complainant seeking payment of the balance consideration.
33. The accused further deposed that he had agreed to get the property converted into freehold by April 2017 and, in case of default, he would transfer 20% of the property to the complainant. He admitted issuance of three cheques of Rs. 50,00,000/- each as security for the amount received from the complainant. He further stated that he paid Rs. 10,00,000/- to the complainant in December 2016 on the assurance that the complainant would facilitate the conversion of the property into freehold. However, according to him, the complainant failed to deposit the said amount with the DDA, compelling him to independently get the property converted into freehold in January-February 2017. The accused further deposed that upon the complainant's failure to pay the remaining sale consideration, it was mutually agreed to cancel the transaction, and he began repaying the advance amount. He alleged that he repaid a total sum of Rs. 1,40,00,000/- in cash, in addition to Rs. 10,00,000/- already paid earlier. He further claimed that the complainant returned the three cheques to him, though the latter did not return the agreement to sell and other documents as allegedly agreed under the MoU. Digitally signed by SURABHI SURABHI SETHI SETHI Date:
2026.03.30 15:42:58 +0530 17 CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh
34. The accused further alleged that in February 2017, the complainant intended to purchase another property, as reflected in the sale deed (Ex. DW- 1/A), and approached him seeking financial assistance of Rs. 3-4 crores. According to the accused, the complainant assured him of good returns or a share in the said property. He deposed that, pursuant thereto, he transferred Rs. 25,00,000/- in February 2017 and Rs. 48,00,000/- in May 2017 into the joint bank account of the complainant and his son. He further stated that due to personal financial constraints arising from issues in his daughter's matrimonial life, he was unable to extend further financial assistance, despite repeated requests from the complainant. The accused alleged that the cheques in question were issued as blank signed cheques solely to assist the complainant in purchasing a property situated at Vishal Enclave. He contended that the complainant subsequently filled in the particulars of the said cheques and misused them by presenting them for encashment.
35. During his cross-examination, the accused admitted that he had entered into the agreement to sell dated 27.05.2016 (Ex. CW-1/R1) on account of financial difficulties. He further acknowledged the correctness of Clause 10 of the said agreement, which cast the obligation of conversion of the property into freehold upon him, though he explained that the complainant was to assist him in the said process. The accused also admitted that the said agreement stood cancelled upon execution of the MoU dated 09.09.2016 (Ex. CW-1/1). It is noteworthy that the accused further conceded that, in terms of the MoU, no further amount was payable by the complainant to him.
36. The accused further alleged a cash payment of Rs. 1.40 crores to the complainant in January/February 2017, however, he admitted that no receipt or documentary proof exists in respect of the said alleged payment. He further admitted being aware of the demonetization in respect of the currency notes of Rs. 500/- and Rs. 1000/- announced by the Government of India on 08.11.2016.
Digitally
signed by
SURABHI
SURABHI SETHI 18
CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh SETHI Date:
2026.03.30
15:43:01
+0530
However, the accused explained that his dealings with the complainant were entirely in cash and hence, he did not have to make any withdrawal from his bank account. Significantly, the accused admitted that the alleged availability of Rs. 1.40 crores in cash was not reflected in his Income Tax Returns. He also failed to disclose the date of the alleged payment of Rs. 10,00,000/- to the complainant and admitted that no receipt exists for the same. His explanation that the said amount was paid at the time when the complainant allegedly offered a bribe to the DDA is wholly unsubstantiated.
37. The accused further deposed that the property was converted into freehold in January 2017; however, he contradicted himself by subsequently stating that such conversion took place in February 2017. He also alleged that the complainant turned dishonest in January 2017 after the conversion of the property. It is pertinent to note that despite admitting that the initial agreement dated 27.05.2016 stood cancelled upon execution of the MoU, and that no further payment was due from the complainant thereafter, the accused has failed to explain why he allegedly demanded the balance sale consideration from the complainant post conversion of the property into freehold.
38. The accused admitted that payments of Rs. 25,00,000/- and Rs. 48,00,000/- made by him to the complainant in February and May 2017, respectively, were in discharge of his liability towards the complainant, and that the three cheques (Mark X) were returned to him thereafter. He further alleged that he had made cash payments of Rs. 1.40 crores in instalments over December 2016, January 2017, and February 2017, but failed to disclose specific dates or any corroborative details. Even assuming, for the sake of argument that the payment of Rs. 73,00,000/- made by the accused into the bank account of the complainant and his son was in respect of a separate property transaction to be undertaken by the complainant and not towards the repayment of the loan amount, the accused failed to offer any plausible as to why he would Digitally signed by SURABHI SURABHI SETHI SETHI Date: 19 CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh 2026.03.30 15:43:05 +0530 extend such financial assistance in March and May 2017, when as per his own contention, the complainant had turned dishonest towards him in January 2017. The accused also failed to bring on record any evidence in support of his contention that he had already repaid the loan amount to the complainant in cash, prior to the aforesaid admitted payment of Rs. 73,00,000/-. In the absence of any cogent evidence of such alleged payment, the same remains a blad assertion made by the accused.
39. During his cross-examination, the accused also admitted that he never demanded the return of the cheques in question from the complainant and had not filed any complaint or suit against him. He further admitted that at the time of the presentation of the cheques, he did not have sufficient funds in his bank account to honour the cheques.
40. Significantly, the accused has failed to bring on record any evidence to show that the amount of Rs. 73,00,000/- paid by him to the complainant was extended as financial assistance to him for entering into a separate property and not in partial discharge of his liability towards the complainant for the repayment of the loan amount of Rs. 1,50,00,000/- as per the MoU (Ex. CW- 1/1). The accused has also not adduced any cogent evidence, whether oral or documentary, of the alleged repayment of the loan amount to the complainant in cash, so as to establish that his liability under the MoU stood discharged prior to the presentation of the cheques in question for encashment. The admission by the accused that he had agreed to sell his property to the complainant owing to his own financial difficulties, also makes it highly improbable that the amount paid by him to the complainant was to financially aid the complainant to enter into another property transaction. Accordingly, mere assertions made by the accused, unsupported by any credible evidence, materially weaken the defence version put forth by him and are insufficient to rebut the statutory presumptions raised in favour of the complainant in the present case.
Digitally signed by SURABHI SURABHI SETHI SETHI Date:
2026.03.30 15:43:08 +0530 20 CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh G. CONCLUSION:-
41. In the backdrop of the above discussion, the accused has not been able to raise a probable defence so as to rebut the presumption of the existence of a legally enforceable debt/liability, raised in favour of the complainant in the present case. Nothing has come out in the entire evidence on record which would probabilize the defence raised by the accused or falsify the case of the complainant.
42. The complainant has been able to establish the guilt of the accused beyond reasonable doubt. Accordingly, the accused, Satvinder Singh stands convicted for the offence punishable under Section 138, Negotiable Instruments Act, 1881.
43. This judgment contains 21 pages. The judgment has been pronounced by the undersigned in open Court and each page bears the signature of the undersigned.
44. Let copy of this judgment forthwith be supplied to the convict free of cost. Let the convict be heard on the quantum of sentence separately.
Digitally signed by SURABHISURABHI SETHI SETHI Date:
Announced in open 2026.03.30 15:43:13 +0530 Court on 30.03.2026 (SURABHI SETHI) JMFC (NI ACT)-02, WEST DISTRICT TIS HAZARI COURT 21 CC No. 1556/2018 S. Jasbir Singh Chawla vs. Satvinder Singh