Delhi District Court
Satish Kumar vs Pramod Tyagi on 9 May, 2025
In The Court of Sh. Divyam Lila, Municipal Magistrate, East, Delhi
-:Judgement:-
CT Case 588/2017
DLET02-001192-2017
(Complainant): Sh. Satish Kumar
R/o H. No. 5-L, Pocket-2, MIG Complex,
Mayur Vihar Phase-III, East Delhi-96
Versus
(Accused): Sh. Pramod Tyagi
R/o H. No. O-1503, Penthouse, Design arch,
E- Sector-5, Vaishali, Ghaziabad UP
Advocate appearing for Complainant: Sh. Lokesh Kumar Mishra
Advocate appearing for Accused: Sh. Rafiq Ahmad
Offence punishable under Section 138 of Negotiable Instruments Act DIVYAM
Final Order : Acquittal under Section 138 NI Act LILA
Digitally signed by
DIVYAM LILA
Location: Court Room no.
12, KKD, East, Delhi
-:Index of Judgment:- Date: 2025.05.09
18:40:01 +0530
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:……………………………………………………………………. 4
5. Evidence on Record……………………………………………………………………………. 4
6. Legal Position:…………………………………………………………………………………….8
7. Arguments on behalf of the parties:…………………………………………………… 11
8. Analysis and Findings:……………………………………………………………………… 14
10. Conclusion and Reason for decision:……………………………………………….. 25
11. Order:……………………………………………………………………………………………..26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
1. Introduction:-
a. This judgment adjudicates a complaint filed under Section 138 of
the Negotiable Instruments Act, 1881 (hereinafter referred to as
“NI Act“) by the complainant against the accused for the alleged
dishonour of a cheque in the complaint case based on the return of
the payment on the revocation of the property sale agreements.
2. Brief Facts of the Case:-
a. The complainant, alleges in his complaint, that he has known the
accused since long having friendly relations and commercial
relations. The complainant alleges that he entered into a registered
agreement to sell on 17.08.2015 with Pramod Tyagi and his wife
Kavita Tyagi for Rs. 1,30,00,000/- for property for Flat No. 1105,
Shipra Krishna Vista, Indirapuram, Ghaziabad. The complainant
stated that he had paid Rs. 13,00,000/- as earnest money for the
same. Further stated in the complaint that due to a price dispute, a
new unregistered agreement was executed on 04.02.2016 for Rs.
2,40,00,000/-, with Rs. 1,30,00,000/- paid via RTGS and Rs.
1,10,00,000/- in cash. Additionally, the complainant claims to have
paid Rs. 62,00,000/- for another flat (No. O-1503, Design Arch,
Vaishali) under an unregistered agreement for total agreed
consideration of Rs. 1,60,00,000/-. Now the case of the
complainant is that the accused person defrauded him by selling
property which was encumbered, and the accused person failed to
register the same. Hence, it is alleged by the complainant that
owing to failed transactions, Pramod Tyagi and Kavita Tyagi
allegedly issued six cheques totaling Rs. 3,02,00,000/- to refund
the payments, two of which were presented and dishonored.
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 2/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhib. It is noted at this stage that the present case pertains to the bunch of
two connected cases arising out of these two cheques itself, filed by
the complainant Satish Kumar against Pramod Tyagi and Kavita
Tyagi. Both the cases pertain to the cheque dishonour and for the
cheque of Rs. 50,00,000/- each. The case CT 588/2019 is filed
against Pramod and case CT 590/2018 was filed against Kavita
Tyagi.
c. The present case pertains to the cheque bearing No. 626985 dated
19.12.2016 for Rs. 50,00,000/- drawn on State Bank of India,
Vaishali, Ghaziabad, UP, (hereinafter referred to as “cheque in
question”) in favour of the complainant to discharge a liability
arising from a property transaction. The cheque was dishonored
with the remarks “Insufficient Funds/Sign Differ”. A legal demand
notice dated 10.01.2017 was served, but the accused failed to make
payment within the stipulated period, leading to the present
complaint. The cognizance in the present matter was taken, and the
accused was summoned for the purpose of trial.
3. Notice Framed on the Accused and Plea of the Accused
a. The accused was served notice under Section 251 Cr.P.C and he
pleaded “not guilty”.
b. The accused denied issuing the cheque to the complainant for the
payment, and stated in his defense that the cheque was given for
the security against the bank loan.
c. The accused had admitted that the cheque pertained to his account,
having his signature, admitted receiving the cheque and stated that
there was sale of the penthouse to the complainant for Rs. 2.4
crores.
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 3/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
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.?
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: List of Documents Relied and Filed by
Complainant (Satish Kumar):
i. Ex. CW-1/A: Registered Agreement to Sell dated 17.08.2015
for Flat No. 1105, Shipra Krishna Vista, Indirapuram,
Ghaziabad, for Rs. 1,30,00,000/-. Includes Rs. 13,00,000/-
Bayana payment.
ii. Ex. CW-1/B: Unregistered Agreement to Sell dated
04.02.2016 revising Flat No. 1105 consideration to Rs.
2,40,00,000/-. Claims Rs. 1,92,00,000/- via RTGS, Rs.
1,10,00,000/- cash, with possession handed over.
iii. Ex. CW-1/B1: Unregistered Agreement to Sell dated
27.08.2015 for Flat No. O-1503, Design Arch, Vaishali,
Ghaziabad, for Rs. 1,60,00,000/-. Claims Rs. 62,00,000/-
paid (Rs. 30,00,000/- RTGS, Rs. 32,00,000/- adjusted).
iv. Ex. CW-1/C: Original Cheque No. 626985 amounting to Rs.
50,00,000/- dated 19.12.2016, issued by the accused, drawn
on State Bank of India, Vaishali, Ghaziabad.
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 4/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
v. Ex. CW-1/D: Original Bank Return Memo dated 19.12.2016,
indicating dishonor of Cheque No. 626985 with remarks
“Insufficient Funds/Sign Differ.”
vi. Ex. CW-1/E: Legal Demand Notice dated 10.01.2017, sent
to accused demanding payment of cheque amount.
vii. Ex. CW-1/F: Postal Receipt for the legal notice sent via
viii. Mark C-1 to C-5: Photocopies of five additional cheques
(Nos. 682923, 066593, 000048, 066592, 111441) issued by
accused/Kavita Tyagi, totaling Rs. 2,52,00,000/-, not all
presented for encashment.
ix. Ex. CW-1/G: Income Tax Returns (company).
x. Ex. CW-1/H: Bank Statements (21.01.2014 to 05.10.2015)
of complainant’s accounts.
xi. Ex. CW-1/DX1: Description: Bail Order (20.07.2018) for
Kavita Tyagi, filed by accused, shown to complainant during
cross-examination.
xii. In the cross examination of CW-1, the complainant
confirmed residing at Flat No. E-1105 since 2018-19 as
owner with possession given by the accused on 04.02.2016.
The possession is supported by a registered agreement and
NOC on Rs. 100/- stamp paper, and utilities (electricity, gas,
society membership) transferred to his name in 2016. He
admitted paying Rs. 13,00,000/- as Bayana and attempting
registry on 20.01.2016 where the accused did not appear. He
admitted not sending a legal notice for non-appearance for
the date fixed (20.01.2016) for the registry, but clarified
meeting the accused physically for the same. He described a
close relationship with the accused since 2008-09, engaging
in mutual money-lending, with the accused borrowing for
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 5/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
business needs, but denied taking loans or receiving security
cheques. The complainant also admitted that the bank loan
was paid by the accused. He owns multiple properties in
Ghaziabad and Noida. The six cheques, received in
September/October 2016, were signed with filled particulars,
but only two were presented. He filed an FIR for forgery and
an injunction suit in Ghaziabad and was unaware of cases by
the accused against him. He detailed payments of Rs.
2,40,00,000/- for Flat No. 1105 (Rs. 1,30,00,000/- via RTGS,
Rs. 1,10,00,000/- in cash, sourced from friends, savings, and
mother’s property sale) and Rs. 62,00,000/- for Flat No.
O-1503, with no registered agreement. He admitted to a Rs.
3,42,00,000/- loan to the accused, with Rs. 1,24,00,000/-
repaid, without a written agreement. The complainant denied
producing the pre-2014 bank statements and transaction
details between the complainant and the accused, while
clarifying that he can only produce 2014 and later records
despite admitted relationship since 2010-11. Transactions
were reflected in company ITR (Ex. CW-1/G), not personal,
and he could not provide a breakdown. He denied the
accused’s claims of paying Rs. 2,40,00,000/-, receiving
security cheques, or purchasing properties in Jewar/Greater
Noida, and denied forging Ex. CW-1/B and Ex. CW-1/B1. In
response to court questions, he confirmed Flat No. 1105 was
in the accused’s name before Ex. CW-1/A, registered at
Tehsil Ghaziabad, and learned in 2018 that the accused
mortgaged and sold it to Revati Nandan in 2014. He could
not specify amounts transferred by the accused from
2008-2023 but offered to produce bank statements.
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 6/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
Additional documents included Ex. CW-1/DX1 (bail order),
Ex. CW-1/G (ITR), and Ex. CW-1/H (bank statements,
2014-2015).
b. Statement of Accused under Sec 313 CrPC: The accused admits
to the registered agreement (Ex. CW-1/A, 17.08.2015) to sell Flat
No. 1105, Shipra Krishna Vista, Indirapuram, Ghaziabad, for Rs.
1,30,00,000/-, but claims the actual deal was for Rs. 2,40,00,000/-,
with Rs. 1,30,00,000/- at circle value and Rs. 1,10,00,000/- in cash,
receiving only Rs. 13,00,000/- as Bayana. He denies any agreement
for Flat No. O-1503, Design Arch, Vaishali, and admits issuing the
cheque (Ex. CW-1/C) but asserts it was for a separate transaction,
not to repay Rs. 3,02,00,000/-, as he and the complainant were
engaged in multiple property dealings. He acknowledges the
cheque’s dishonor (Ex. CW-1/D) as a record matter, denies
receiving the legal notice (Ex. CW-1/E) despite the correct address,
alleges the complainant misused the cheque for extortion, and
denies receiving Rs. 3,02,00,000/-. He expressed intent to lead
defense evidence.
c. Defence Evidence: Sh. Pramod Tyagi, testified as Defense
Witness-1 (DW-1); wherein he confirmed the registered agreement
(Ex. CW-1/A, 17.08.2015) for Flat No. 1105, Shipra Krishna Vista,
Indirapuram, Ghaziabad, admitting receipt of Rs. 13,00,000/- via
cheque as Bayana, but denied receiving further payments or Rs.
1,10,00,000/- in cash as claimed in the unregistered agreement (Ex.
CW-1/B, 04.02.2016). He also denied any agreement for Flat No.
O-1503, Design Arch, Vaishali (Ex. CW-1/B1, 27.08.2015), stating
it was not in his name, and disputed both unregistered agreements
as forged. He admitted to mutual financial transactions with the
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 7/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
complainant since 2010-11, involving friendly loans, claiming to
have paid Rs. 1,24,00,000/- in 2014-2016 and received Rs.
3,42,00,000/-, with the balance of Rs. 2,18,00,000/- linked to a
Jewar property, not Flat No. 1105. He asserted the cheque (Ex.
CW-1/C) was for a separate transaction, not the alleged Rs.
3,02,00,000/- liability, and denied receiving the legal notice (Ex.
CW-1/E). He relied on photocopied documents as evidence Ex.
DW-1/1: registry entry showing Rs. 1,17,00,000/- due; Ex.
DW-1/2: bail order; Ex. DW-1/3: civil suit order; Ex. DW-1/4:
Bayana agreement. The said documents were objected by counsel
for the complainant for lack of being originals or Section 65B
certification. In cross-examination by the complainant’s counsel,
The witness DW-1 reiterated receiving only Rs. 13,00,000/- via
cheque, not RTGS, denied post-agreement payments or Ex.
CW-1/B’s validity, and rejected any Flat No. O-1503 agreement or
payments. He confirmed prior transactions, admitting Rs.
1,24,00,000/- paid and Rs. 3,42,00,000/- received, denying the
latter was for Flat No. 1105 and linking the balance to Jewar
properties. He denied receiving or ignoring the notice, and rejected
allegations that his documents (Ex. DW-1/1 to Ex. DW-1/4) were
filed to mislead, and denied Ex. DW-1/3 was only a stay order.
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:
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 8/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhii. 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
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
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 9/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
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
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
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 10/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
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 on behalf of the parties:
a. Arguments on behalf of the counsel for the Complainant:
i. Issuance of Cheque for Legally Enforceable Debt: The
accused issued Cheque in question to discharge a legally
enforceable debt of Rs. 3,02,00,000/- arising from property
transactions for Flat No. 1105, Shipra Krishna Vista,
Indirapuram, Ghaziabad, and Flat No. O-1503, Design Arch,
Vaishali, Ghaziabad. The cheque’s issuance establishes a
presumption of debt under Section 139 of the Negotiable
Instruments Act, 1881, which the accused failed to rebut.
ii. Fraudulent Conduct by Accused: The accused cheated the
complainant by failing to register the flats despite receiving
Rs. 2,40,00,000/- for Flat No. 1105 and Rs. 62,00,000/- for
Flat No. O-1503. The accused wrongfully sold Flat No. 1105
to a third party in 2014, breaching the agreement and
defrauding the complainant. The accused defrauded the
complainant by selling the flat which was already mortgaged
to a bank, and the same was sold without the prior
knowledge of the complainant.
iii. Unrebutted Presumption and Testimony: The accused did not
rebut the statutory presumption under Section 139 NI Act,
which assumes the cheque was issued for a valid debt. TheCT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 11/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhiaccused failed to impeach the complainant’s testimony or
provide a credible explanation for how the cheque came into
the complainant’s possession.
iv. Supporting Evidence: The registered agreement (Ex.
CW-1/A, 17.08.2015) confirms the initial transaction for Flat
No. 1105, with Rs. 13,00,000/- paid as Bayana. The
complainant’s possession of Flat No. 1105, with utilities
(electricity, gas) and society membership in his name since
2016, corroborated by an NOC, supports the claim of
substantial payments. The cheque’s dishonor and the
unanswered legal demand notice fulfill the requirements of
Section 138 NI Act.
v. Cash Transaction Explanation: The complainant and the
accused had entered into a transaction which involved
payment through bank partly and unaccounted cash
payments for other parts; which is a normal kind of
transaction in every property transaction and should be
considered by this court.
b. Arguments on behalf of the counsel for the Complainant:
i. Inadmissibility of Unregistered Agreements: The
complainant relies on unregistered and unstamped
agreements (Ex. CW-1/B, 04.02.2016; Ex. CW-1/B1,
27.08.2015), which are inadmissible under Section 91 of the
Indian Evidence Act, 1872, and Section 17 of the
Registration Act, 1908, as they attempt to modify the
registered agreement (Ex. CW-1/A) without mandatory
registration post-2011 amendments. These documents cannot
establish the alleged liability of Rs. 3,02,00,000/-.
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 12/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
ii. Improbability of Cash Payment: The complainant’s claim of
paying Rs. 1,10,00,000/- in cash for Flat No. 1105 is
unproven and improbable, given the complainant’s
experience as a seasoned property dealer and the absence of
receipts, witnesses, or bank records. Such a large cash
transaction without registration, especially amid a strained
relationship, lacks credibility.
iii. Complainant’s Possession Indicates No Liability: The
complainant has possession of Flat No. 1105, with
electricity, gas, and society membership in his name since
2016, supported by an NOC and possession letter from the
accused. This suggests the transaction was partially fulfilled,
negating any outstanding liability for Rs. 2,40,00,000/-.
iv. Probable Defense of Separate Transaction: The complainant
admitted to prior loan transactions worth Rs. 3,42,00,000/-,
with Rs. 1,24,00,000/- repaid by the accused, indicating the
cheque was issued for a separate transaction, not the flat’s
payment. The accused’s claim that only Rs. 13,00,000/- was
received for Flat No. 1105 is supported by the registry entry
(Ex. DW-1/1), raising a probable defense of cheque misuse.
v. Denial of Flat No. O-1503 Transaction: The accused denies
any agreement or ownership of Flat No. O-1503, and the
complainant’s lack of knowledge about its ownership
undermines Ex. CW-1/B1. The complainant failed to prove
full payment or entitlement to Rs. 62,00,000/- for this flat.
vi. Failure to Prove Debt: The complainant did not prove what
was the actual fraud that was committed, as the complainant
admitted that the bank loan was paid by the accused,
complainant also admitted that the property belonged in the
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 13/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
name of the accused, the complainant also did not prove any
cheating done by the accused or fraudulent selling of the
property. In fact the complainant himself has not made hte
payment of the flats and hence the complainant has failed to
prove any debt.
8. Analysis and Findings:
a. Issue 1 – Issuance of Cheque: This ingredient pertains to the
issuance of the cheque in question itself. The Accused, in his notice
of accusation has admitted his signature on the cheque in question
and that the cheque has been drawn on the account of the Accused
himself. The accused has also admitted issuance of the cheque to
the complainant as a security but for a separate transaction of loans,
and denied issuing the same for the payment of money pertaining
to property purchases alleged. The plea of the accused that the date
/ particulars of the cheque in question was not filled by him 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 isCT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 14/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhipossible 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
the signature thereon as constituting a ‘material alteration’ for the
pur- poses 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 his signature on the cheque and
the account being maintained by him. 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 him for discharge of the liability; 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 of valid debt is drawn against
the accused.
b. Issue 2 – Presentation within Validity: This ingredient stands
satisfied on a bare perusal of the cheque in question and the return
memo being presented within the period of validity. The cheque is
also not dishonoured with the remark “instrument stale”; as theCT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 15/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhicheque has been dishonoured with a return memo noting the reason
for return as “Funds Insufficient”. 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.
c. Issue 3 – Dishonour of Cheque: The bank return memo records
state that the cheque in question has been returned dishonoured for
the reason “Funds Insufficient”. 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 his notice of accusation u/s 251 Cr.P.C accepted receiving
the legal demand notice, however in the statement of Accused u/s
313 Cr.P.C read with Sec-281 Cr.P.C, The accused denied receiving
the legal notice but 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 incorrect. 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.CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 16/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, DelhiPalapetty 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 of
non-service of legal notice. Thus, in the present case, in absence of
any evidence against the presumption of service and admission of
the accused with respect to address being correct, this issue no. 4 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
the complainant has misused the cheque in question, which was
given as security for the separate loan transactions taken by the
accused from the complainant. The case of the accused is not for
any payments made after the legal notice. 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.
9. 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 of presumption. In the present
case, the accused had made following attempts towards rebuttal of the
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 17/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
statutory presumption against him; and with the following observations, it
is held that the issue no. 6 is decided against the complainant and in
favour of the accused:
a. Inadmissibility of Unregistered Agreements (Ex. CW-1/B, Ex.
CW-1/B1): The complainant’s case heavily relies on two
unregistered agreements; Ex. CW-1/B (04.02.2016) revising the
consideration for Flat No. 1105 to Rs. 2,40,00,000/- and Ex.
CW-1/B1 (27.08.2015) for Flat No. O-1503 for Rs. 1,60,00,000/-.
Under Section 17 of the Registration Act, 1908, agreements to sell
immovable property must be registered. Section 91 of the Indian
Evidence Act, 1872, further mandates that terms of a registered
document (Ex. CW-1/A) cannot be modified by an unregistered
document unless duly registered. Here, Ex. CW-1/B seeks to
modify the registered agreement (Ex. CW-1/A) by increasing the
consideration from Rs. 1,30,00,000/- to Rs. 2,40,00,000/-.
However, it lacks registration, and further the complainant failed to
prove the accused’s signature or call the witnesses to authenticate
it. Similarly, Ex. CW-1/B1 is unregistered, and the accused denies
execution of the same or any related transaction. The complainant’s
lack of knowledge about the ownership of Flat No. O-1503 further
undermines its credibility. Consequently, these documents are
inadmissible to establish the alleged liability of Rs. 3,02,00,000/-,
weakening the complainant’s claim. The complainant has also
failed to prove the execution of these documents by proving the
signature of the accused on the same or calling any witness.
b. Payments made towards Ex CW 1/A: Payment of Rs.
1,17,00,000/- towards the Ex CW 1/A not proven in the
background of admitted transaction of separate transaction of loanCT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 18/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhiof Rs.3.42 crores by the accused from the complainant. Following
are the reasons for the same:
i. The complainant did not specify the dates and the manner of
transaction, despite clear questions being asked by Ld.
counsel for the accused in the cross examination and dodged
that he would have to tally the bank records and state the
same. Similarly the complainant and the evidence affidavit
is also silent on the payments so made, their dates and the
modes. The silence of the complainant with non explanation
of the dates and amounts lends credibility to the narrative of
the accused that payment was not made for the flat.
ii. Further, the defense has clearly denied receiving the payment
for the remaining amount of the flat and has admitted that
only Rs. 13,00,000/- has been given as part of the Bayana/
Token amount. The registered agreement Ex. CW 1/A
records the payment of Rs. 13,00,000/- and states that the
remaining payment will be given by the second party on or
before 20.01.2016 or at the time of sale deed execution
between parties; corroborating the narrative of the accused.
The complainant had deposed that the accused did not turn
up for the registry and created issue on price rise, the said
fact has been corroborated by the photocopy document filed
by the DW -1 which reflected the entry made at the registry
and letter issued purportedly by the complainant reporting
that the accused person did not turn up for registry on
20.01.2016 as per the agreement and he could not pay Rs.
1,17,00,000/-. This document has not been challenged by
the complainant seriously in the cross examination. It raises
serious doubts on the claim of the complainant, although the
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 19/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
accused has also not proven the document by calling the
witness or producing the original. These all evidences and
documents in conjunction go against the story of the
complainant and corroborates the version of the accused that
the payment could not have been made by the complainant
for the said property owing to admitted dispute between
parties.
iii. On perusal of the Ex. CW 1/H which is a table of the
transactions shown by the complainant made to the accused,
the spouse of the accused and real estate companies; it
reveals that the payments have been made from as early as
21.01.2014 and majority of payments were made before the
date of agreement Ex CW 1/A. The statement also reflects
certain payments back to the complainant from one firm.
The remaining payments shown, are made after the date
17.08.2015 of document Ex. CW 1/A, but well before the
date 04.02.2016 of the second document Ex CW 1/B. It is
highly unlikely that the complainant made such huge
payments to the accused amidst the admitted position of
dispute between parties. The defense of the accused appears
plausible that the said payments so shown pertains to the
alleged loan, and it is highly unlikely when the one
transaction is already under stress and dispute, the parties in
engaging in further transactions on the basis of unregistered
agreements.
c. Improbability of Rs. 1,10,00,000/- Cash Payment: The
complainant claims to have paid Rs. 1,10,00,000/- in cash on
04.02.2016 for Flat No. 1105, as per Ex. CW-1/B. This claim is
highly improbable for the following reasons:
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 20/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhii. Complainant’s Profile: The complainant is a seasoned
property dealer with an export-import business, holding
multiple properties in Ghaziabad and Noida. It is unlikely
that such a person would pay a substantial amount in cash
without insisting on a registered document, especially given
the admitted position of strained relationship between them
due to the accused’s alleged failure to appear for registry on
20.01.2016. The complainant himself deposed that “The
accused had put many conditions on me with respect to the
flat and I was put in a spot with respect to the flat, to save
my money I already paid the accused”; which suggests
relationship between parties with raised caution and more
vigilance, especially when the complainant is a experienced
property buyer; and hence it is highly unlikely that such cash
was paid.
ii. Lack of Corroboration: No receipts, witnesses, or
documentary evidence (e.g., bank withdrawals) substantiate
the cash payment. The complainant’s claim that the cash was
sourced from friends, savings, and his mother’s property sale
is vague and unsupported.
iii. Mutual Understanding Claim: The complainant’s assertion
that the unregistered agreement (Ex. CW-1/B) was executed
on mutual understanding that is inconsistent with the
admitted price dispute and the accused’s non-appearance at
the registry, which would have heightened caution.
iv. Accused’s Denial: The accused denies receiving any cash
payment, asserting that only Rs. 13,00,000/- was paid, as
supported by Ex. DW-1/1 (registry entry showing Rs.
1,17,00,000/- due at registry).
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 21/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
d. Probable Defense of Prior Loan Transactions: Under Section
139 NI Act, there is a rebuttable presumption that a cheque was
issued to discharge a legally enforceable debt. However, the
accused can rebut this presumption by raising a probable defense.
The accused has done so effectively by :
i. Admission of Prior Transactions: Both parties admit to a
long-standing financial relationship since 2010-11, involving
loans and repayments. The complainant acknowledges
lending Rs. 3,42,00,000/- to the accused, with Rs.
1,24,00,000/- repaid, and the accused confirms receiving Rs.
3,42,00,000/-, attributing the balance (Rs. 2,18,00,000/-) to a
property transaction in Jewar. Although the accused has not
produced the documents to support his claim; however, the
eerie silence of the complainant, when questioned about the
dates on which the account payments were made, raises
doubts. Further the statement of the account filed by the
complainant and the sheet reflecting the payment shows the
payments do not correspond to the dates on which the
agreement is made and does not align with the claim of the
complainant. The inability of the complainant to produce the
bank statement of the prior transaction also attracts adverse
inference from this court.
ii. Cheque’s Purpose: The accused claims the cheque Ex.
CW-1/C was issued for a separate transaction, not for the
flat’s payment, and was misused by the complainant. The
complainant’s admission of prior loans without written
agreements creates ambiguity about the cheque’s purpose.
Obtaining security cheques against such mutual loans is a
general practise and it is highly unlikely that the accused hadCT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 22/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhiissued the cheques to the complainant straight-forward
amidst the environment of failed transactions and property
disputes.
iii. Partial Payment for Flat No. 1105: The accused admits
receiving Rs. 13,00,000/- for Flat No. 1105, consistent with
Ex. CW-1/A and Ex. DW-1/4. Ex. DW-1/1 further indicates
that Rs. 1,17,00,000/- was to be paid at the registry,
supporting the accused’s claim that no further payments
were received.
iv. Complainant’s Possession of flat: The complainant’s
possession of Flat No. 1105, with utilities and society
membership in his name since 2016, and the accused’s
provision of an NOC and possession letter, suggest that the
transaction was partially fulfilled, reducing the likelihood of
an outstanding liability of Rs. 2,40,00,000/-.
v. Fraud and Debt not proved: The complainant himself has
admitted that the bank loan was paid by the accused, and that
he had got title of the property verified from the bank; this
goes against the narrative of the complainant that the fraud
was committed. The complainant has been unable to show
how the fraud has been committed and why he was entitled
to the payment back. The complainant himself has not made
the entire payment for the alleged transaction of Ex CW
1/B1; hence the claim with respect to said property is not
made out. The complainant has already obtained possession
of the property under Ex CW 1/A and already has other
documentation in his name; the issue of non-registration
only remains by the parties. The complainant has beenCT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 23/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhiunable to demonstrate how the non -registration of flat alone
entitles him for the refund of the whole amount back.
e. Complainant’s Inaction Post – Non-Registration: The
complainant alleges that the accused failed to appear for registry on
20.01.2016, necessitating the unregistered agreement (Ex.
CW-1/B). However, the complainant’s conduct is inconsistent with
that of a prudent person:
i. No Legal Action: Despite the accused’s alleged
non-appearance, the complainant did not issue a legal notice,
file a civil suit for specific performance, or lodge a police
complaint for cheating at the time. This inaction is surprising
for a seasoned property dealer claiming a significant
investment in properties.
ii. Delayed Fraud Allegation: The complainant claims to have
learned in 2018 that the accused sold Flat No. 1105 to Revati
Nandan in 2014. However, no sale deed or documentary
evidence was produced to substantiate this, and the accused’s
payment of the bank loan and provision of possession
suggest no fraudulent intent.
iii. Defence Document Ex. DW-1/1: The registry entry confirms
the complainant’s readiness to pay Rs. 1,17,00,000/- on
20.01.2016, contradicting the claim of having already paid
Rs. 1,30,00,000/- via RTGS and Rs. 1,10,00,000/- in cash by
04.02.2016. This inaction and inconsistency weaken the
complainant’s claim of a legally enforceable debt and
support the accused’s defense that the transaction did not
proceed beyond the initial payment.
f. Defense Evidence Limitations: The accused’s defense exhibits
Ex. DW-1/1 to Ex. DW-1/4 are photocopies, objected to by the
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 24/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhi
complainant for lack of originals or Section 65B certification.
However, Ex. DW-1/1 (registry entry) is consistent with Ex.
CW-1/A and was not seriously challenged in cross-examination.
The accused’s testimony about prior loans and partial repayment is
corroborated by the complainant’s admission of a Rs. 3,42,00,000/-
loan and Rs. 1,24,00,000/- repayment.
10.Conclusion and Reason for decision:
a. The Issue no. 1, 2, 3, 4 and 5 were decided in favour of the
complainant and the presumption was drawn against the accused.
The fate of the complainant’s case hinged on the ability of the
accused to rebut the presumptions drawn against him, and as
decided above, the issue no. 6 is decided against the complainant,
and in favour of the accused; thereby deciding that the accused was
successfully able to rebut the presumption drawn against him.
b. The complainant has failed to prove beyond reasonable doubt that
the cheque was issued to discharge a legally enforceable debt of
Rs. 50,00,000/- or that the accused owed Rs. 3,02,00,000/- as
claimed. The reliance on unregistered agreements, the improbable
claim of Rs. 1,10,00,000/- cash payment, the lack of clear bank
records, and the complainant’s inaction post-non-registration create
significant doubt. The accused has raised a probable defense by
demonstrating prior loan transactions, partial payment for Flat No.
1105, and the complainant’s possession of the property, rebutting
the presumption under Section 139 NI Act.
c. As held in the judgement of Shivaji Sahabrao Bobade v. State of
Maharashtra [(1973) 2 SCC 793 – it is important to underscore the
established canon of criminal law that in order to pass a convictionCT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 25/ 26
In the court of Sh. Divyam Lila, MM/JMFC, East district, Karkardooma courts, Delhiin a criminal case, the accused “must be” guilty and not merely
“may be” guilty. The mental distance between “may be” to “must
be” guilty is a long one and must be travelled not on surmises and
conjectures, but by cogent evidence. In this case, the accused has
successfully created a doubt in the story of the complainant in
respect of the fact that the cheque in question was issued to return
the money arising out of the failed property transaction. And as per
the settled law, the benefit of doubt must go to the accused. The
material on record does not suggest that the accused “must be”
guilty whichever way one looks at it. In view of the above
discussions, the present case appears to be a fit case where benefit
of doubt can be extended to the accused.
11.Order:
a. The accused Sh. Pramod Tyagi is acquitted of the offence under
Section 138 NI Act.
b. The bail bonds of the accused and the sureties (in any), that are
already filed in the court for the purpose of bail, are retained for the
purpose of section 437 A Cr.P.C for the period of six months from
today.
c. The signed copy of the judgement be uploaded on the CIS
immediately.
d. Let the file be consigned to the record room, after due compliance.
e. Pronounced in open court and in presence of both the parties/
or their Counsels.
Digitally
signed by
DIVYAM LILA (DIVYAM LILA)
Location:
DIVYAM Court Room
no. 12, KKD,
LILA East, Delhi
Date:
2025.05.09
18:40:11 Municipal Magistrate, East District
+0530
Date: 09.05.2025 Karkardooma Court/Delhi
___________________________end of the document_____________________
CT Case no 588/2017 Satish Kumar vs Pramod Tyagi page 26/ 26