Delhi District Court
Aisha Fatma vs Maqsood And Company And Others on 13 August, 2025
IN THE COURT OF SH. ANMOL NOHRIA, DJS, JUDICIAL
MAGISTRATE FIRST CLASS-02, NORTH - EAST,
KARKARDOOMA COURTS, DELHI
CC No. : 641/2020
U/s : 138 N. I. Act
P.S : Seelampur
Aisha Fatima vs. Maqsood and Company & Ors.
CNR No. : DLNE020016672020
-: J U D G M E N T :-
1. CC No. : 641/2020
2. Date of institution of the case: 21.07.2020
3. Name of complainant : Aisha Fatima,
D/o Ameenuddin, R/o H.
No. 1463, Gali No. 52,
Jafrabad, Delhi-53.
4. Name of accused, parentage
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:27
+0530
CC No. 641/2020
Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
Page No. 1 of 34 JMFC-02/NE/KKD Courts/Delhi
and address : 1). Maqsood & Company
Through its Proprietor,
Maqsood Ali S/o Nazir
Ali, R/o H. No. C-901,
Gali No. 06, Chauhan
Bangar, Delhi-53.
2). Maqsood Ali
S/o Nazir Ali, R/o H.
No. C-901, Gali No. 06,
Chauhan Bangar, Delhi-53.
5. Offence complained of : 138 N. I. Act
6. Plea of accused : Accused pleaded not guilty
7. Final order : CONVICTED
8. Date on which order was
reserved : 05.06.2025
9. Date of pronouncement : 13.08.2025
1. The instant matter has originated out of a complaint
under section 200 Cr.PC read with Section 142 Negotiable
Digitally
Instruments Act (hereinafter referred to as the 'N I Act'), filed by the
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:28
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CC No. 641/2020
Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
Page No. 2 of 34 JMFC-02/NE/KKD Courts/Delhi
complainant company against the accused under Section 138 N I Act
alleging that cheque bearing number- 000229 dated 10.02.2020
amounting to Rs. 5,00,000/-drawn on Kotak Mahindra Bank, Preet
Vihar, Delhi issued by the accused in favour of the complainant, in
discharge of a legal debt or other liability, has been dishonored and the
accused has not paid the said amount even after receiving the
prescribed legal demand notice. By virtue of this judgment, the
present complaint is being disposed off.
BRIEF REASONS FOR THE DECISION OF THE CASE
FACTUAL BACKGROUND OF THE CASE:-
2. Briefly stated facts of this case as per complaint are that
accused is a friend of her brother namely Javed and having cordial
relations with him and had thereafter, had taken a loan of Rs.5,00,000
from the complainant in the name of his firm Maqsood & Company
via cheque. When the complainant asked for repayment, the accused
issued a cheque bearing number- 000229 dated 10.02.2020 amounting
to Rs. 5,00,000/-drawn on Kotak Mahindra Bank, Preet Vihar, Delhi
and also issued an undertaking/receipt qua his repayment on
15.02.2020. However, on presentation on 02.05.2020 the same was
returned unpaid with remarks “fund insufficient” vide returm memo
dated 04.05.2020. Complainant got issued a legal notice dated
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:24
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
Page No. 3 of 34 JMFC-02/NE/KKD Courts/Delhi
28.05.2020 but, no payment was made by the accused and hence, the
present complaint was filed.
PROCEEDINGS BEFORE COURT
3. On the basis of pre-summoning evidence, accused was
summoned by the court for the offence under Section 138 of
Negotiable Instrument Act. The accused put in his own appearance
and thereafter notice under Section 251 Cr.P.C. was framed upon the
accused on 03.03.2022 to which accused pleaded not guilty and
claimed trial. In his plea of defence, the accused stated that he has no
transactions with the complainant but with Jameel Ahmed, who is
maternal uncle of complainant and had not issued the cheque to her
but to Jameel Ahmed as security from whom he had taken
Rs.25,00,000 as loan from which he has returned about Rs.22,72,000
and has no legal liability to pay the complainant. Statement under
Section 294 Cr.P.C of the accused was also recorded on 03.03.2022,
wherein he has admitted his signatures on the cheque in question but
denied receiving legal demand notice and filling the particulars of the
cheque.
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:26
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
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4. Vide order dated 26.11.2022 the accused to cross
examine the complainant and request has been allowed to cross
examine the complainant under Section 145 (2) NI Act.
5. During the trial, complainant has led the oral and
documentary evidence against the accused to prove his case beyond
reasonable doubt. The following evidence are as under:
Oral Evidence
CW1 Aisha Fatma (Complainant)
Documentary Evidence
Ex. CW1/A Evidence Affidavit
Ex. CW1/1 Receipt cum acknowledgement
Ex. CW-1/2 Original Cheque
Ex. CW-1/3 Cheque return memo
Ex. CW-1/4 Legal demand notice
Ex. CW-1/5(colly) Postal receipt
Ex. CW-1/6 POD of legal notice
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:25
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
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6. The complainant was cross examined at length by the
counsel for the accused on 08.12.2023. Thereafter the complainant’s
evidence was closed. Statement of accused was recorded under
Section 313 of The Code of Criminal Procedure, 1973 read with
Section 281 of The Code of Criminal Procedure, 1973 on 19.01.2024.
Incriminating evidence was put to him wherein he has admitted,
signatures on cheque stated that he does not know the complainant
and has never signed any acknowledgment and has no transactions
with her or any liability towards her.
7. Thereafter, the matter was listed for defence evidence and
accused has examined Mohd. Javed and himself as DW1 and DW2
respectively and has lead oral evidence. However, he has further
examined Mohd. Nazim(accused son) as DW3 after application u/S
311 Cr.P.C. was allowed, who has proved the ledger DW3/A.
Thereafter, DE was closed and matter was listed for final arguments.
8. Afterwards, final arguments were heard on behalf of both
the parties and after hearing the arguments, trial was concluded.
9. It has been argued that the complainant has been able to
prove his case by way of presumptions in his favor and the accused
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:25
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
Page No. 6 of 34 JMFC-02/NE/KKD Courts/Delhi
has failed to rebut the same by leading any cogent evidence. It has
been further argued that the accused has not been able to rebut the
presumptions of law and nothing has been brought out in the cross
examination and defence evidence for the same. It has been further
argued that the accused failed to discharge the burden cast upon him
and has put forward a false defence; and has failed to prove his
defence to rebut the version of the complainant; consequently, the case
of the complainant stands proved in view of the same.
10. Per contra, it has been argued that the case of the
complainant is false one. At the outset, the counsel for the accused has
questioned the appearance of SPA stating that SPA does not mention
that the SPA has specific knowledge of the facts of the case and has
placed reliance upon A.C. Narayanan vs. State of Maharashtra, 2014
(11) SCC 790. Further, it has been argued that the complainant has not
been able to prove his case beyond reasonable doubt for securing a
conviction; and the accused by way of cross examination of the
complainant and his own evidence, has been able to dislodge the
version of the complainant. It is submitted that the accused is
defending the case upon the following grounds:
i. Accused has never received the legal demand notice;
ii. The impugned cheque was blank signed security cheque;
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:24
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
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iii. The impugned cheque was never issued to the
complainant and accused has no transactions with the
complainant.
11. I have heard the counsels for both the parties; perused the
record and have gone through relevant provisions of the law and the
judgments relied upon by both the parties.
INGREDIENTS OF OFFENCE AND DISCUSSION-
12. Since, the accused has raised a question of locus of the
SPA, it becomes necessary at the outset to discuss the same. It has
been argued for the accused that the present complaint is not
maintainable as the SPA filed by the complainant in the present case
does not mention that the SPA holder has specific and personal
knowledge of the facts of the case; and hence the present proceedings
are not maintainable in terms of the judgment of the Hon’ble Supreme
Court in the case of A.C. Narayanan vs. State of Maharashtra(Supra).
13. Perusal of the record shows that the present complaint
has been filed by the complainant Aisha Fatma in her own name and
without any SPA. She has also filed her evidence affidavit Ex. PW1/A
upon which the cognizance was taken. Thereafter, an application with
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:26
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
Page No. 8 of 34 JMFC-02/NE/KKD Courts/Delhi
SPA was filed by the complainant seeking to persue the matter
through SPA, however, the same was allowed only to the extent of
purposes of appearance only and exemption from appearance was
granted to the complainant vide order dated 25.03.2022. Thereafter,
the complainant herself was cross examined by counsel for the
accused on 08.12.2023 as CW1.
14. Since, the complaint has been filed by complainant in her
own capacity as the holder of the cheque and thereafter has also
stepped into the witness box herself for cross examination; I am of the
opinion that the facts of the present case do not fall within the purview
of case being filled through SPA holder and the principles of A.C.
Narayanan vs. State of Maharashtra(Supra) are not a bar in the same.
15. Ergo, the contention qua SPA of the accused does not
hold water with this court and is accordingly, dismissed.
16. Now, before dwelling into the facts of the present case, it
would be apposite to discuss the legal standards required to be met by
both sides. In order to establish the offence under Section 138 of NI
Act, the prosecution must fulfill all the essential ingredients of the
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:29
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
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offence. Perusal of the bare provision reveals the following necessary
ingredients of the offence :-
First Ingredient: The cheque was drawn by a
person on an account maintained by him for
payment of money and the same is presented
for payment within a period of 3 months from
the date on which it is drawn or within the
period of its validity;
Second Ingredient: The cheque was drawn by
the drawer for discharge of any legally
enforceable debt or other liability;
Third Ingredient: The cheque was returned
unpaid by the bank due to either insufficiency
of funds in the account to honour the cheque or
that it exceeds the amount arranged to be paid
from that account on an agreement made with
that bank;
Fourth Ingredient: A demand of the said amount
has been made by the payee or holder in due
course of the cheque by a notice in writing
given to the drawer within thirty days of the
receipt of information of the dishonour of
cheque from the bank;
Fifth Ingredient: The drawer fails to make
payment of the said amount of money within
fifteen days from the date of receipt of notice.
17. It is only when all the aforementioned ingredients are
satisfied that the person who had drawn the cheque can be deemed to
have committed an offence under Section 138 of the NI Act.
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:27
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
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18. The accused can only be held guilty of the offence under
Section 138 NI Act if the above-mentioned ingredients are proved by
the complainant co-extensively. Additionally, the conditions stipulated
under Section 142 NI Act have to be fulfilled.
APPRECIATION OF EVIDENCE-
19. Notably, there is no dispute qua the proof of first and
fifth ingredient. The complainant had proved the original cheque vide
Ex. CW1/2 which the accused had not disputed as being drawn on the
account of the accused. It was not disputed that the cheque in question
was presented within its validity period. Notably, no dispute has been
raised qua the fifth ingredient as such the same is deemed to be
proved that no payment has been made after issuance of legal demand
notice.
20. As far as the third ingredient is concerned, the
complainant is only required to prove the dishonor of the cheque for
the reasons attributable to the accused. In the instant case, the cheque
in question was returned unpaid vide return memos Ex. CW1/3. At
this stage a reference can be drawn from Section 146 of NI Act as per
which the court shall on production of bank’s slip or memo having
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
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thereon the official mark denoting that the cheque has been
dishonoured, presume the fact of dishonour of such cheque, unless
and until such fact is disproved. In the instant case perusal of the
cheque return memo Ex. CW1/3 shows that they bear a stamp of the
bank with signature and date. Further, neither any question as to the
factum of dishonor has been put to the complainant in the cross
examination nor any evidence regarding the same has been brought in
the defence. Thus, no evidence has been led to disprove the fact of
dishonor. Further, the Hon’ble Delhi High Court in the case of Guneet
Bhasin vs State of NCT of Delhi & Anr. & Ors; 2022/DHC/005048,
has observed that the purpose of the cheque return memo is to give the
information of the holder of the cheque that his cheque on
presentation could not be encashed due to the variety of reasons as
mentioned in the cheque return memo. From the discussion above it
can be concluded that there is no need for the complainant to examine
any bank witness to prove the cheque return memo if it falls in the
ambit of Section 146 NI Act. Ergo, the factum of dishonor stands
proved in view of Section 146 and consequently third ingredient
stands proved.
21. So far as the legal demand notice is concerned it is one of
the statutory requirements in order to bring home the guilt of the
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:29
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accused under section 138. Any defect in the statutory requirement
would go to the very root of the proceedings as such it is essential to
first discuss whether the legal notice issued by the complainant in
compliance with the provisions of section 138 or not. Provisio (b)
appended to Section 138 with respect to legal demand notice is
reproduced below for ready reference:
(a) “The payee or the holder in due course of
the cheque, as the case may be, makes a
demand for the payment of the said amount of
money by giving a notice in writing, to the
drawer of the cheque, within thirty days] of the
receipt of information by him from the bank
regarding the return of the cheque as unpaid;”
22. As such, it is necessary that the payee or holder in due
course makes demand of money due by giving a notice to the drawer,
in writing, within 30 days of receipt of information from the bank
regarding the return of the cheque is dishonoured. The object of notice
is to give a chance to the door of the cheque to rectify his omission
and also to protect an honest drawer. Reliance is placed upon, Central
Bank of India vs Saxons Farms, 1999(39) ACC891(SC).
23. In the factual matrix of the present case, the accused in
his statement u/s 294 and in his statement u/s313 r/w 281 Cr.P.C has
Digitally
denied receiving the legal demand notice.
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:27
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
Page No. 13 of 34 JMFC-02/NE/KKD Courts/Delhi
24. However, perusal of the cross examination of the
complainant, shows that no question qua the legal demand notice or
the address of the accused has been put by the accused to deny the
service. Further, no suggestion that no legal notice was sent which has
been denied by the complainant. Further, the summons have also been
served to the accused at the same address and also NBW’s have been
sent at the same address which came back unexecuted with reports
that he was not available at home. Also, the accused has also in his
particulars at stage of notice framing, statement u/s 313 and as DW2
has mentioned the address as mentioned upon legal demand notice
Ex. CW1/4.
25. In the landmark decision of Hon’ble Supreme Court of
India in matter of “C. C. Alavi Haji Vs. Palapetty Mohd. & Anr.”
reported in (2007) 6 Supreme Court Cases 555 held that as under:-
“16. It is also to be borne in mind that the
requirement of giving of notice is a clear
departure from the rule of Criminal Law, where
there is no stipulation of giving of a notice
before filing a complaint Any drawer who
claims that he did not receive the notice sent by
post, can, within 15 days of receipt of summons
from the court in respect of the complaint under
Section 138 of the Act, make payment of the
cheque amount and submit to the Court that he
Digitally
had made payment within 15 days of receipt of
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
15:00:26
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
Page No. 14 of 34 JMFC-02/NE/KKD Courts/Delhi
summons (by receiving a copy of complaint
with the summons) and, therefore, the
complaint is liable to be rejected. A person who
does not pay within 15 days of receipt of the
summons from the Court along with the copy
of the complaint under Section 138 of the Act,
cannot obviously contend that there was no
proper service of notice as required under
Section 138, by ignoring statutory presumption
to the contrary under Section 27 of the G.C.
Act and Section 114 of the Evidence Act. In
our view, any other interpretation, of the
proviso would defeat the very object of the
legislation. As observed in Bhaskarans case
(supra), if the giving of notice in the context of
Clause (b) of the proviso was the same as the
receipt of notice a trickster cheque drawer
would get the premium to avoid receiving the
notice by adopting different strategies and
escape from legal consequences of Section 138
of the Act.”
26. The perusal of the address mentioned on the memo of
parties, the legal demand notice Ex. CW1/4, summons, NBW’s, notice
u/s 251 Cr.P.C. and statement of accused under section 313 of Cr.P.C
and testimony of DW2 shows that addresses are same. Also, the
accused in his cross examination as DW2 has stated that he is staying
at the said address since 1980 and is the registered owner of the first
floor of the said address and has received the summons on the same.
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
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Aisha Fatima vs. Maqsood Company & Anr. (Anmol Nohria)
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Hence, placing reliance upon Hon’ble Supreme Court of India in
matter of “C. C. Alavi Haji Vs. Palapetty Mohd. & Anr(Supra), there
is a deemed delivery of legal demand notice. Consequently, the legal
demand notice Ex. CW1/4 and postal receipts Ex. CW1/5 and POD
Ex. CW1/6 is deemed to be proved. Hence, the requirements of fourth
ingredient stand complied with.
27. As far as the proof of second ingredient is concerned, the
complainant has to prove that the cheque in question was drawn by
the drawer for discharging a legally enforceable debt. However, as per
the scheme of the NI Act, once the accused admits signature on the
cheque in question, certain presumptions are drawn, which result in
shifting of onus. Section 118(a) of the NI Act lays down the
presumption that every negotiable instrument was made or drawn for
consideration. Another presumption is enumerated in Section 139 of
NI Act. The provision lays down the presumption that the holder of
the cheque received it for the discharge, in whole or part, of any debt
or other liability.
28. The combined effect of these two provisions is a
presumption that the cheque was drawn for consideration and given
by the accused for the discharge of debt or other liability. Both the
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
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sections use the expression “shall”, which makes it imperative for the
court to raise the presumptions, once the foundational facts required
for the same are proved. Reliance is placed upon the judgment of the
Hon’ble Supreme Court, Hiten P. Dalal vs. Bratindranath Banerjee
(2001) 6 SCC 16.
29. Further, it has been held by a three-judge bench of the
Hon’ble Apex Court in the case of Rangappa vs. Sri Mohan (2010) 11
SCC 441 that the presumption contemplated under Section 139 of NI
Act includes the presumption of existence of a legally enforceable
debt. Once the presumption is raised, it is for the accused to rebut the
same by establishing a probable defence. The principles pertaining to
the presumptions and the onus of proof were recently summarized by
the Hon’ble Apex Court in Basalingappa vs. Mudibasappa (2019) 5
SCC 418 as under: –
“25. We having noticed the ratio laid down by
this Court in the above cases on Section 118(a)
and 139, we now summarize the principles
enumerated by this Court in the following
manner:
25.1. Once the execution of cheque is admitted
Section 139 of the Act mandates a presumption
that the cheque was for the discharge of any
debt or other liability.
25.2. The presumption under Section 139 is a
Digitally
rebuttable presumption and the onus is on the
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
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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 evidence 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 preponderance
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 support his
defence.”
30. Thus, the presumptions raised under Section 118(b) and
Section 139 NI Act are rebuttable presumptions. A reverse onus is cast
on the accused, who has to establish a probable defence on the
standard of preponderance of probabilities to prove that either there
was no legally enforceable debt or other liability.
31. In this case, the accused in his plea of defence has stated
that he has no transactions with the complainant but with Jameel
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
2025.08.13
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Ahmed, who is maternal uncle of complainant and had not issued the
cheque to her but to Jameel Ahmed as security from whom he had
taken Rs.25,00,000 as loan from which he has returned about
Rs.22,72,000 and has no legal liability to pay the complainant.
Consequently, the accused has raised the following defences to rebut
the presumptions:
a) The cheque in question is blank security cheque;
b) The accused does not have liability as per the version of
the complainant as cheque was never issued to the
complainant and accused has no transactions with the
complainant.
I will be discussing both the defences separately.
a.) The cheque in question is blank security cheque:
32. It has been stated by the accused that the cheque in
question was a blank security cheque and he has never filled any
particulars on the same. Further, the cheque has never been issued to
the complainant but to Jameel Ahmed as security, maternal uncle of
complainant from whom he had taken Rs.25,00,000/- as loan.
33. At this stage reference can be drawn from Section 20 of
the NI Act talks about inchoate instruments. As per this provision if a
Digitally
signed by
ANMOL
ANMOL NOHRIA
NOHRIA Date:
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person gives a duly signed cheque which is either blank or partly
filled then he is deemed to have given implied authority to the holder
to fill up the particular in it and complete the cheque, thus making the
drawer liable for the payment mentioned in it. 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 provision of section 138 would be attracted
34. The Hon’ble Supreme Court in the case of Bir Singh vs.
Mukesh Kumar (2019) 4 SCC 197 wherein the Apex Court while
upholding the validity of blank signed cheque in a proceeding u/s 138
of the Act has interalia held the following:-
“If a signed blank cheque is voluntarily
presented to a payee,towards some payment, the
payee may fill up the amount and other
particulars. This in itself would not invalidate
the cheque. The onus would still be on the
accused to prove that the cheque was not in
discharge of a debt or liability by adducing
evidence.”
35. Notably, in the case of Suresh Chandra Goyal Vs. Amit
Singhal, Crl.L.P. 706/2014, it was held by the Hon’ble Delhi High
Court that:-
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“The appellant was well within his rights to
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enforce the security in respect whereof the
cheques in question were issued and to seek to
recover the outstanding debt by encashment of
the said cheques. Since the cheques in question
were dishonoured upon presentation, the ac-
cused suffered all consequences as provided
for in law and the appellant became entitled to
invoke all his rights as created by law. Thus,
the appellant was entitled to invoke Section
138 of the NI Act; issue the statutory notice of
demand, and; upon failure of the accused to
make payment in terms of notice of demand –
to initiate the complaint under Section 138 of
the NI Act.”
36. It is noteworthy that the Hon’ble Apex Court in the case
of Sripati Singh Vs. The State of Jharkhand and Ors., AIR 2021 SC
5732, has held that:-
“16. A cheque issued as security pursuant to a
financial transaction cannot be considered as a
worthless piece of paper under every
circumstance. ‘Security’ in its true sense is the
state of being safe and the security given for a
loan is something given as a pledge of
payment. It is given, deposited or pledged to
make certain the fulfilment of an obligation to
which the parties to the transaction are bound.
If in a transaction, a loan is advanced and the
borrower agrees to repay the amount in a
specified timeframe and issues a cheque as
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security to secure such repayment; if the loan
amount is not repaid in any other form before
the due date or if there is no other
understanding or agreement between the
parties to defer the payment of amount, the
cheque which is issued as security would
mature for presentation and the drawee of the
cheque would be entitled to present the same.
On such presentation, if the same is
dishonoured, the consequences contemplated
Under Section 138 and the other provisions of
N.I. Act would flow.
17.When a cheque is issued and is treated as
‘security’ towards repayment of an amount
with a time period being stipulated for
repayment, all that it ensures is that such
cheque which is issued as ‘security’ cannot be
presented prior to the loan or the instalment
maturing for repayment towards which such
cheque is issued as security. Further, the
borrower would have the option of repaying
the loan amount or such financial liability in
any other form and in that manner if the
amount of loan due and payable has been
discharged within the agreed period, the
cheque issued as security cannot thereafter be
presented. Therefore, the prior discharge of
the loan or there being an altered situation due
to which there would be understanding
between the parties is a sine qua non to not
present the cheque which was issued as
security. These are only the defences that
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would be available to the drawer of the cheque
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in a proceedings initiated Under Section 138
of the N.I. Act. Therefore, there cannot be a
hard and fast Rule that a cheque which is
issued as security can never be presented by
the drawee of the cheque. If such is the
understanding a cheque would also be reduced
to an ‘on demand promissory note’ and in all
circumstances, it would only be a civil
litigation to recover the amount, which is not
the intention of the statute. When a cheque is
issued even though as ‘security’ the
consequence flowing therefrom is also known
to the drawer of the cheque and in the
circumstance stated above if the cheque is
presented and dishonoured, the holder of the
cheque/drawee would have the option of
initiating the civil proceedings for recovery or
the criminal proceedings for punishment in the
fact situation, but in any event, it is not for the
drawer of the cheque to dictate terms with
regard to the nature of litigation.”
37. Further, in case of Credential Leasing & Credits Ltd. Vs.
Shruti Investments & Ors., 2015 (4) JCC 252, it was held that:
“30. Thus, I am of the considered view that
there is no merit in the legal submission of the
respondent accused that only on account of the
fact that the cheque in question was issued as
security in respect of a contingent liability, the
complaint under Section 138 of the NI Act
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would not be maintainable. At the same time, I
may add that it would need examination on a
case to case basis as to whether, on the date of
presentation of the dishonoured cheque the
ascertained and crystallised debt or other
liability did not exist. The onus to raise a
probable defence would lie on the accused, as
the law raises a presumption in favour of the
holder of the cheque that the dishonoured
cheque was issued in respect of a debt or other
liability. As settled by the Supreme Court, the
said onus obliges the accused to raise a
defence – either by picking holes in the case of
the complainant and/ or by positively leading
defence evidence which leads the Court to
believe that there is a probable defence raised
by the accused to the claim of the complainant
with regard to the existence of the debt or other
liability. The said onus does not cast as
stringent an obligation on the accused, as it
casts on the complainant, who has to prove
beyond reasonable doubt the guilt of the
accused.”
38. Thus, it is a settled of the proposition of law that a check
issued a security, pursuit of financial transaction, cannot be considered
as a worthless piece of paper. It is given to ensure the fulfillment of an
obligation undertaken. If a check issued to secure repayment of a loan
advanced and if the loan is not repaid on or before the due date, the
drawee would be entitled to get the cheque for payment, and if such a
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cheque is dishonored, the consequences contemplated under section
138 NI act would follow. Reliance is placed upon Sripati Singh v.
State of Jharkhand(Supra). Further as to the plea of cheque being a
security check, it was held in ICDS v. Beena Shabir & Anr.(Supra),
that security checks would also fall within the purview of section 138
NI act and a person cannot escape is liability unless he proves that the
debt or liability for which cheque was issued as security is satisfied
otherwise.
39. With regards to the submission that the cheque was never
issued to the complainant but to Jameel Ahmed who is the maternal
uncle of the complainant from whom he had taken Rs. 25,00,000/- and
never to the complainant; the accused while cross examining the
complainant has never asked any question qua the same as to how and
when the same was handed over apart from suggestions regarding
handing over the same to Jameel Ahmed which have been denied by
the complainant. Further, the accused has never made any such
complaint to the police regarding its misuse by Jameel Ahmed or the
complainant.
40. However, accused had led defence evidence to prove the
same. Perusal of the testimony of DW1 shows that he has not
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supported the version of the accused but has rather proved the
agreement Ex. CW1/1 and identified his signatures on the same as a
witness and stated that accused had issued the said cheque in his
presence at the time of execution of Ex. CW1/1. Perusal of Ex.
CW1/1 shows that accused has specifically admitted his liability in the
same and has also admitted to the issuance of the cheque in question
to the complainant in the same. Perusal of the testimony of accused as
DW2, shows that he has never stated anything in the same qua the
issuance of the cheque in his examination in chief. Same is the case
with the testimony of son of the accused as DW3.
41. In terms of Section 101 of Indian Evidence Act a person
is bound to prove the existence of any fact, it is said that the burden of
proof lies on that person. In other words “he who asserts must prove”
the standard of proof in civil cases is preponderance of probability,
while in the criminal cases the standard of proof is beyond the
reasonable doubts. If no evidence at all is adduced by either side, the
person on whom the burden of proof lies would fail. One who asserts
a particular fact is in existence, then he has to prove the said fact
unless and until the law says that the burden lies on anymore else; and
in the instant case the burden to prove issuance to Jameel Ahmed andDigitally
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not to complainant was upon the accused and in view of the
discussion above, he has failed to discharge the same.
42. Ergo, in light of the above discussion, this court is of the
considered view that, the ground that the cheque in question is a blank
security cheque and not issued to the complainant does not hold water
with this court and even in case of blank signed cheque, the statutory
presumptions under section 118(a) and 139 would be raised in favour
of the complainant. Therefore, in instant case, since, the accused has
admitted the execution of impugned cheque, the aforementioned
statutory presumptions would be raised in favour of the complainant
regarding the fact that the impugned cheque have been drawn for
consideration and issued by the accused in discharge of legally
enforceable debt.
b.) The accused does not have liability as per the version of the
complainant and has no transactions with the complainant.
43. In the instant case, the version of the complainant in the
complainant is that the accused has issued the impugned cheque in
order to discharge his liability to repay the amount advanced by the
complainant to the accused at the instance of her brother and the
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accused has even issued an acknowledgment for the same on
15.02.2020.
44. By virtue of the presumptions the onus is upon to
accused to show the debt qua the cheque amount does not exist upon
him; and for the purposes of the same the accused has relied upon the
cross examination of the complainant as well as his defence evidence.
45. Perusal of the cross examination of the complainant
shows that complainant is unaware as to the particulars of work or
family of the accused but has clarified that the money was advanced at
the instance of her brother. No question as to source of funds, time of
advancing etc., has been put to the complainant in the cross
examination and only suggestions qua cheque being blank security
cheque and its particulars or repayment have been asked which have
been denied by the complainant. It is noteworthy, that the accused
while cross examining the complainant, has himself given a
suggestion that he had taken a sum of Rs.25,00,000/- out which
Rs.5,00,000/- belonged to the complainant and rest to Jameel Ahmed,
which is in actual an admission by the accused of his liability towards
the complainant. Also, neither any question qua the acknowledgment
Ex. CW1/1 or its execution has been put to the complainant nor any
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suggestion denying the same has been put to the complainant rather
perusal of testimony of DW2 shows that he has proved the agreement
Ex. CW1/1 and identified his signatures on the same as a witness and
stated that accused had issued the said cheque in his presence at the
time of execution of Ex. CW1/1. Perusal of Ex. CW1/1 shows that
accused has specifically admitted his liability in the same and has also
admitted to the issuance of the cheque in question to the complainant
in the same and the same also finds mention of the particulars of the
cheque. Further, no mode of repayment has been put to the
complainant by the accused while cross examining her. Thus, nothing
has been brought out by the accused by cross examination of the
complainant to dislodge or her version or to prove his own case.
46. Further, coming to the evidence led by the accused in his
defence that he has made payment of Rs. 22,00,000 something to the
Jameel including the amount of the complainant; the defence witness
DW1 has not supported the version of the accused and has rather
deposed in favor of the complainant and has also negated the fact that
any repayment was made by the accused to the complainant in his
presence. The accused himself as DW2 has stated the he has made
repayments but in his cross examination has stated that he has filed
the ledger in support of the same on judicial record which was
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nowhere to be found when confronted with judicial record in his cross
examination. Further DW2, in his cross examination has admitted that
cheque of the complainant was encashed in his account, thereby
admitting that he has liability towards the complainant. Further DW2
has stated in his cross examination that he has no receiving of the
money paid by him to Javed or any other person on behalf of the
complainant and he has no document in this regard. Thus, the version
of DW1 and DW2 put together also, negate the defence of the accused
that he has repaid the complainant.
47. However, the accused after the same produced DW3/
Mohd. Nazim in order to prove his defence by bringing on record the
ledgers to show entries of repayment by way of application u/S 311
Cr.P.C. Perusal of the testimony of DW3 shows that he has brought on
record ledger DW3/A from 04.07.2016 to 04.02.2020 and stated that
he has handed over money to Javed or Jameel and has repaid an
amount of Rs. 22,22,700 including the amount due to the complainant,
the same being part of one single transaction. However, it was
observed by the court in his testimony that entries in name of Jameel
Ahmed were forged and made later on when confronted with 2 pages
of DW3/A and thus it was in totality observed that such entry has been
squeezed at every page wherever place was found and is in a different
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ink. Thus, in view of the above discussion , testimony of DW3 can be
discarded in totality and the authenticity of DW3/A itself comes under
a cloud and same can be found to be forged and fabricated specially in
the circumstance when it was not produced at the very first instance.
48. Another argument put forth by the counsel for the
accused is that even if the squeezed in entries are ignored there exist
other entries on several pages which show the repayment and are in
the name of Jameel.
49. I have perused the ledger and the said entries can be
found as under:-
Page no. of Amount in Rupees
DW3/A
8 Rs.11,138/-
9 Rs.11,550/-
10 Rs.11,390/-
11 Rs.11,300/-
12 Rs.11,390/-
13 Rs.11,330/-
14 Rs.10,990/-
16 Rs.38,190/-
17 Rs.17,281/-
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ANMOL NOHRIA
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18 Rs.34,632/-
20 Rs.32,372/-
22 Rs.36,723/-
28 Rs.20,000/-
42 Rs.33,057/-
Total Total amount :
entries : 14 Rs.2,91,343/-
50. After, perusal of the entries, even if the same are believed
to be genuine, a doubt arises that why would there be two entries in
the name of same person of the same day and the accused has not
been able to clarify the same; and even if the same are believed to be
true the same do not total up to the amount as stated by DW2 or DW3
as stated by them in their testimony. Thus, the argument of certain
entries being genuine also does not water with this court.
51. It has been held by the Hon’ble Supreme Court of India
in ‘Rohitbhai Jivanlal Patel v. State of Gujarat & Anr. [(2019) 18 SCC
106] –
“17. On the aspects relating to preponderance of
probabilities, the accused has to bring on record
such facts and such circumstances which may
lead the Court to conclude either that the
consideration did not exist or that its non-
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existence was so probable that a prudent man
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would, under the circumstances of the case, act
upon the plea that the consideration did not exist.
This Court has, time and again, emphasized that
though there may not be sufficient negative
evidence which could be brought on record by
the accused to discharge his burden, yet mere
denial would not fulfil the requirements of
rebuttal as envisaged under Section 118 and 139
of the NI Act. …”
52. Ergo, it can be concluded that the evidence led by the
accused also does not come to the aid of the accused and the accused
by the same has failed to dislodge the version of the complainant or
prove his owns of return of Rs.22,00,000/- something; and in view of
the discussion above the version put forward by the accused is highly
unbelievable and does not hold water with this court. The accused has
failed to create a probable doubt to rebut the presumptions through the
cross examination of the complainant or by way of independent
evidence, in the version of the complainant, accordingly, the defence
taken by the accused that does not find merit and the accused has
failed to rebutt the presumption raised under section 139 of NI Act.
Consequently, it can be said that the cheque in question was issued by
the accused in discharge of legally recoverable debt/liability/owed
towards the complainant thus, the second ingredient to the offence
under section 138 of NI Act stands proved.
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ANMOL
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CONCLUSION:
53. To recapitulate the above discussion, the complainant has
been successful in establishing his case beyond reasonable doubt with
the aid of presumptions of law raised in his favor under section 118
and 139 of the NI Act by and other evidence; and by withstanding the
test of cross examination to punch the holes in the case of the
complainant and making the case of the complainant doubtful. In the
result of the analysis of the present case, the accused no. 01 i.e.
Maqsood Company and accused no. 02 i.e. Maqsood Ali S/o Nazir Ali
are hereby convicted of the offence punishable under Section 138,
Negotiable Instruments Act, 1881.
54. This judgment contains 34 pages. This judgment has
been signed and pronounced by the undersigned in open court.
55. Let a copy of the judgment be given free of cost to the
convict.
56. Let a copy of the judgment be uploaded on the official
website of District Courts, Karkardooma forthwith.
Announced in the open (ANMOL NOHRIA)
Digitally
signed by
Court on 13th August, 2025 JMFC-02/NE/KKD COURTS
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