Delhi District Court
Rama vs Sharif Ahmad on 13 June, 2025
IN THE COURT OF
JUDICIAL MAGISTRATE FIRST CLASS-01
Digitally
KKD COURTS, DELHI.
signed by
PRITU PRITU RAJ
Date:
RAJ 2025.06.13
17:44:27
+0530
TITLE: : Smt. Rama vs. Sharif
R-NO. : 46054/2016
Name of Informant/complainant : Smt. Rama
w/o Sh. Dilip Kumar, R/o 26/43-44, Sarvo-
daya Mini Market, Trilokpuri, Delhi-110091
Name of accused : Sharif Ahmed
R/o H.No. A-166, Sector-20, Noida, UP-
201301
Notice framed under section/s : s. 138 NI Act
Plea of the Accused : Not Guilty
Date of hearing Final Arguments: : 11-06-2025
Date of pronouncement : 13-06-2025
Final Order : Acquittal
For the Complainant : Sh. Anil Kumar Sharma
For the Defence : Sh. K A Ali
Present : Pritu Raj
J.M. FC- 01,
KKD Courts, Delhi.
R No. 46054/2016 Rama v. Sharif Page 1 / 11
JUDGEMENT
1. The accused is facing trial for offence s. 138 NI Act.
2. Stated succinctly, the facts germane for the prosecution of the case are that the
accused and complainant were well-known to each other and the accused ap-
proached the complainant in first week of Jan. 2015 for a friendly loan of Rs. 4
lakhs. Seeing the urgency, requirement and considering the relations between the
parties, the complainant arranged an amount of Rs. 4 lakhs and the same was
given to the accused as a friendly loan on 10.01.2015 in the presence of indepen-
dent witnesses on the assurance that the accused would return the amount within
06 months. The accused in discharge of the aforesaid liability paid Rs. 50,000/- in
cash and issue a cheque bearing no. 062622 dated 30.07.2015, drawn on Canara
Bank, Sector-20, Noida, for the balance amount of Rs. 3,50,000/- while promis-
ing that the cheque would be honored on presentation. However, when the
cheque was presented for encasement at SBI, Himmat Puri Branch, Block-27,
Trilokpuri, it was dishonoured with the endorsement “ACCOUNT CLOSED”.
The same was brought to the notice of the accused but the accused avoided to
meet the complainant. Consequently, a legal notice dated 24.11.2015, was served
upon the accused but a false and frivolous reply of the said notice was furnished
by the accused and the amount remained unpaid by the accused. Hence the
present case.
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signed by
PRITU RAJ
PRITU Date:
RAJ 2025.06.13
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3. During the course of pre-summoning evidence, the complainant examined herself
on affidavit Ex. CW1/A and relied upon documents exhibited as Ex. CW1/1 to
Ex. CW1/6.
4. The accused was summoned, upon appreciation of the pre-summoning evidence
led by the complainant, for offences u/s 138 NI Act and notice u/s 251 Cr.P.C.
was framed against him and read over in Hindi to which he pleaded not guilty
and claimed trial.
5. During the course of framing of notice, the accused admitted his signature on the
cheque and stated that he had issued the cheque to the accused. However, he
stated that the cheque in question was issued in a blank condition along with 11
other cheques to the complainant for taking money as part of a committee in 2006
as the complainant never gave money without blank signed cheques.
6. The matter was then fixed for post-summoning evidence wherein the complaint
examined himself and adopted his pre-summoning evidence. He was cross-exam-
ined at length by the Ld. Counsel for the accused and discharged.
7. CE was closed vide order dated 12.07.2017 and the statement of accused under
Section 281 Cr.P.C. read with Section 313 Cr.P.C. was recorded in which all the
incriminating evidence were put to him to which accused took the defence that
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the cheque in question was issued in a blank condition along with 11 other
cheques, to the complainant for taking money as part of a committee in 2006 as
the complainant never gave money without blank signed cheques.
8. In defence evidence, despite opportunity, no DE was led and the same was closed
vide order dated 09.11.2022.
9. Final arguments were heard from both sides and the matter was listed for judg-
ment.
APPRECIATION OF EVIDENCE
10. Prior to embarking to determine the guilt/innocence of the accused it would be
prudent to reproduce the relevant provision of law for the sake of brevity.
”where any cheque drawn by a person on an account maintained by him
with a banker for payment of any amount of money to another person from
out of that account for the discharge, in whole or in part, of any debt or
other liability, is returned by the bank unpaid, either because of the amount
of money standing to the credit of that account is insufficient to honour the
cheque or that it exceeds the amount arranged to be paid from that account
by an agreement made with that bank, such person shall be deemed to have
committed an offence and shall without prejudice to any other provisions
of this Act, be punished with imprisonment for a term which may be ex-
tended to two years, or with fine which extend to twice the amount of the
cheque, or with both”.
11. It is a well settled proposition of law that in order to successfully bring home a
prosecution under s. 138 NI Act, the following ingredients ought to be satisfied:
1. the accused issued a cheque on account maintained by him with a bank.
2. the said cheque has been issued in discharge, in whole or in part, of any
legal debt or other liability. Digitally
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3. the said cheque has been presented to the bank within a period of three
months from the date of cheque or within the period of its validity.
4. the aforesaid cheque, when presented for encashment, was returned un-
paid/dishonoured.
5. the payee of the cheque issued a legal notice of demand to the drawer
within 30 days from the receipt of information by him from the bank re-
garding the return of the cheque.
6. the drawer of the cheque failed to make the payment within 15 days of
the receipt of aforesaid legal notice of demand.
12. The first issue to be determined here is whether the accused had issued the
cheque in question to the complainant in the discharge of any debt or liability.
The complainant in this regard has placed reliance on her affidavit, exhibited as
Ex. CW1/A, wherein she has stated that the cheque in question had been issued
by the accused towards her in discharge of a legally enforceable debt/liability.
Moreover, the accused has admitted his signature on the cheque in question in the
notice framed under section 251 Cr.P.C. In the considered opinion of this Court,
the factum of admission of execution of the cheque on question gives rise to the
presumption u/s 139 NI Act. Reliance in this regard is placed on Vasanthaku-
mar Vs. Vijayakumari (2015) 8 SCC 378 wherein it was held “Therefore, in the
present case since the cheque as well as the signature has been accepted by the
accused respondent, the presumption under Section 139 would operate.” The
same has been reiterated in M/S Kalamani Tex vs P. Balasubramanian 2021
SCC Online SC 75 “Once the 2nd Appellant had admitted his signatures on the
cheque and the Deed, the trial Court ought to have presumed that the cheque was
issued as consideration for a legally enforceable debt.
R No. 46054/2016 Rama v. Sharif Page 5 / 11
13. Having determined the issuance of the cheque by the accused, the second issue
requiring determination is whether the same had been issued for the discharge of
any debt or liability. A perusal of the scheme of the NI Act, makes it apparently
clear that the statute raises two presumptions in favour of the complainant –
firstly, pertaining to the passing of consideration [as contained in s. 118 (a)] and
secondly, pertaining to receipt of the cheque in discharge of, either in whole or
part, any debt of liability. Same are reproduced here for the sake of ease of refer-
ence:
Section 118 “Presumptions as to negotiable instruments: Until the con-
trary is proved, the following presumptions shall be made: (a) of consider-
ation
– that every negotiable instrument was made or drawn for considera-
tion, and that every such instrument, when it has been accepted, indorsed,
negotiated or transferred was accepted, indorsed, negotiated or transferred
for consideration;”
Section 139 “Presumption in favour of holder – it shall be presumed, un-
less the contrary is proved, that the holder of a cheque received the cheque
of the nature referred to in Section 138 for the discharge, in whole or in
part, of any debt or other liability”.
14. These presumptions, under section 118 and 139, have to be raised mandatorily.
The principles regarding the presumptions and onus of proof in cases under the
NI act have been summarised by the Hon’ble Apex Court in Basalingappa vs.
Mudibasappa (2019) 5 SCC 418 under:
“We having noticed the ratio laid down by this Court in the above cases on
Section 118(a) and 139, we now summarise the principles enumerated by
this Court in the following manner:
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25.1. Once the execution of cheque is admitted Section 139 of the Act man-
dates a presumption that the cheque was for the discharge of any debt or
other liability.
25.2. The presumption under Section 139 is a rebuttable presumption and
the onus is on the accused to raise probable defence. The standard of proof
for rebutting the presumption is that of preponderance of probabilities.
25.3. To rebut the presumption, it is open for the accused to rely on evi-
dence led by him or the accused can also rely on the materials submitted
by the complainant in order to raise a probable defence. Inference of pre-
ponderance of probabilities can be drawn not only from the materials
brought on record by the parties but also by reference to the circumstances
upon which they rely.
25.4. That it is not necessary for the accused to come in the witness box in
support of his defence. Section 139 imposed an evidentiary burden and not
a persuasive burden.
25.5. It is not necessary for the accused to come in the witness box to sup-
port his defence.”
15. Similarly in Triyambak S.Hegde vs Sripad 2021 SCC Online 788, the Hon’ble
Apex Court held as follows:
On the position of law, the provisions referred to in Section 118 and 139 of
N.I. Act as also the enunciation of law as made by this Court needs no reit-
eration as there is no ambiguity whatsoever. In, Basalingappa vs.
Mudibasappa (supra) relied on by the learned counsel for the respondent,
though on facts the ultimate conclusion therein was against raising pre-
sumption, the facts and circumstances are entirely different as the transac-
tion between the parties as claimed in the said case is peculiar to the facts
of that case where the consideration claimed to have been paid did not find
favour with the Court keeping in view the various transactions and extent
of amount involved. However, the legal position relating to presumption
arising under Section 118 and 139 of N.I. Act on signature being admitted
has been reiterated.
16. However for the offence under Section 138 of the Act, even though the presump-
tions under Sections 118(a) and 139 have to be compulsory raised as soon as exe-
cution of cheque by accused is admitted or proved by the complainant and there-
Digitally
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signed by
PRITU PRITU
Date:
RAJ
RAJ 2025.06.13
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after burden is shifted to accused to prove otherwise, these presumptions endwhen the contrary is proved by the accused, that is, the cheque was not issued for
consideration and in discharge of any debt or liability etc. A presumption is not in
itself evidence but only makes a prima facie case for a party for whose benefit it
exists. Presumptions both under Sections 118 and 139 are rebuttable in nature.
Same was held by the Hon’ble Supreme Court of India in Hiten P. Dalal v.
Bratindranath Banerjee [(2001) 6 SCC 16].
17. Moreover, a mere submission that the case presented by the complainant is false
and that the cheques of the accused have been misused by the complainant is not
enough without any evidence of the rebuttal presented on record. Mere denial
without any corroborative evidence would not deprive the complainant of the
benefit bestowed on him under the special provisions of this Act. The law regard-
ing the nature and standard of defence which ought to be raised by an accused
has been summarised in Kumar Exports v. Sharma Carpets [(2009) 2 SCC
513], where it was held as follows:
“20. The accused may adduce direct evidence to prove that the note in
question was not supported by consideration and that there was no debt or
liability to be discharged by him. However, the court need not insist in ev-
ery case that the accused should disprove the non-existence of considera-
tion and debt by leading direct evidence because the existence of negative
evidence is neither possible nor contemplated.
At the same time, it is clear that bare denial of the passing of the consider-
ation and existence of debt, apparently would not serve the purpose of the
accused. Something which is probable has to be brought on record for get-
ting the burden of proof shifted to the complainant. To disprove the pre-
sumptions, the accused should bring on record such facts and circum-
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stances, upon consideration of which, the court may either believe that the
consideration and debt did not exist or their non-existence was so probable
that a prudent man would under the circumstances of the case, act upon
the plea that they did not exist.”
18. With the aforesaid principles in mind, this Court will now revert to the defense of
the accused. The case of the accused is that the cheques were never issued to-
wards the discharge of any debt or liability but they were issued for taking money
as part of a committee run by the complainant. In the present case, a perusal of
the evidence / cross-examination of CW1 shows that the case of complainant suf-
fers from various discrepancies and lacuna.
Financial capacity to advance the loan
19. At the outset, the financial capacity of the complainant to advance the loan in
question is in doubt. As per the own case of the complainant, she runs a kirana
shop and her husband sells clothes on the footpath in weekly markets. The com-
plainant has claimed that she earns Rs. 20,000/- per month from the said shop
making her yearly income to Rs. 2,40,000/-. With a yearly income of Rs.
2,40,000/- the financial capacity of the complainant to advance a loan nearly two
times the said amount is in serious doubt. While the complainant has no obliga-
tion to prove her financial capacity in cases u/s 138 NI Act, where the case of the
complainant is that the money was lend to the accused in cash and the accused
challenges the financial capacity of the complainant, regardless of the presump-
tion u/s 139 of the Act, the complainant has the obligation to prove her financial
capacity or the source of money. In the present case, the complainant has not got
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anything on record to show her financial capacity to advance a loan of Rs.
4,00,000/- when her entire yearly income was Rs. 2,40,000/-. there is no other
source of income claimed by the complainant which would enable her to advance
the loan in question. The testimony of the complainant is also conspicuously
silent as to the income earned by her husband which, even not claimed by the
complainant, could have been considered as a factor to evaluate her financial ca-
pacity.
No independent witnesses or documentary evidence
20. Further, the nature and circumstances of the transaction under which the loan in
question was advanced to the accused is also doubtful. The complainant claims
that the loan was advanced to the accused in the presence of her husband and in-
dependent witnesses, as claimed in para 3 of the complaint. However, neither the
husband of the complainant nor the independent witnesses were ever examined
by the complainant raising doubts on the veracity of the complainant’s version of
events. Even the names of the persons who were allegedly witnesses to the loan
being advanced were not disclosed by the complainant.
21. Moreover, despite advancing a huge amount of Rs. 4 lakh as loan, no written
agreement or acknowledgment was entered into between the parties. Any prudent
person advancing a huge amount of Rs. 4 lakh in cash would be likely to insist
upon a documentary evidence to corroborate the claim of such loan being ad-
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vanced. For reasons best known to the complainant, no such agreement was en-
tered into. I am fortified in this regard by placing reliance on decision of Hon’ble
Apex Court in John K. John vs. Tom Varghese 2007 (4) LRC 218 SC where it
was observed that the non-execution of an instrument where a huge amount of
money was allegedly paid to the respondent is a relevant question.
DECISION:
22. In view of the aforesaid discussion, I am of the considered opinion that the
complainant has failed to prove her case beyond all reasonable doubts against the
accused. The accused has been able to raise and prove her defence on the basis of
preponderance of probabilities and has successfully rebutted the presumption u/s
118 r/w section 139 NI Act.
23. Accused is thus, acquitted for the offence under Section 138 read with Section
141 of the Negotiable Instruments Act, 1881(as amended upto date).
24. Ordered accordingly.
Digitally
signed by
PRITU PRITU RAJ
Date:
RAJ 2025.06.13
17:45:06
+0530
Announced in open Court (PRITU RAJ)
on 13th June, 2025 Judicial Magistrate-01
East, KKD Courts, Delhi
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