Order 18

Order Details: COPY OF JUDGMENT
Pdf Text: COPY OF THE JUDGMENT OF CONVICTION IN
COMPLIANCE WITH
“SUHAS CHAKMA VS. UNION OF INDIA & ORS” W.P
(C)1082/20
COVERSHEET TO THE COPY OF JUDGMENT
The convict has been informed that the convict may avail
free legal aid facilities for pursuing higher remedies. The
following Authority may be contacted for seeking
appropriate guidance:
District Legal Services Authority, Patiala House Court
Address of the Authority: LADC Office near Court No.41, Production Building,
Patiala House Court, New Delhi District, New Delhi.
Phone No.9971154002
Email id:- newdelhi_dlsa@nic.in
(Akanksha Singh)
JMFC(NIAct)-02-PHC
NDD-ND-31.07.2026
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IN THE COURT OF MS. AKANKSHA SINGH, JUDICIAL MAGISTRATE
FIRST CLASS, NI ACT-02, PATIALA HOUSE COURT NEW DELHI
DISTRICT : NEW DELHI
CC NI Act 7540/2024
CNR no.DLND02-008486-2024
Sh. Afzal Khan,
S/o Sh. Raseed Khan,
R/o H.No.D-1/20,
New Seelampur,
Delhi-110053. ...Complainant
Vs.
Sh. Waseem Raja,
S/o Sh. Yusuf,
R/o A-48, 2nd Floor,
Near Brahmapuri Puliya- Nala Road,
Chauhan Banger, New Seelampur,
Delhi-110053.
Also at:-
H.No.C-55, C-Block,
New Seelampur,
Delhi-110053. ...Accused
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Offence Complained of or proved : U/s 138 of Negotiable
Instruments Act, 1881
Plea of the Accused : Pleaded not guilty
Date of filing : 31.01.2024
Date of Institution : 01.02.2024
Date of reserving judgment/order : 16.07.2026
Final Order/Judgment : Conviction
Date of pronouncement : 31.07.2026
JUDGMENT
1. Vide this Judgment, I shall decide the present complaint filed under
Section 138 of the Negotiable Instruments Act, 1881 by the complainant
against the accused.
Factual Matrix
2. Briefly stated, the case of the complainant is that the accused approached
him and presented himself as well-known property dealer while stating
that he wished to sell his property at ground floor of the property bearing
no. E-15/C-1/66, T-Huts, Brahampuri Puliya, New Seelampur, Delhi.
Thereafter, the complainant paid Rs. 7,50,000/- as advance for purchasing
the ground floor of the abovesaid property, but the accused did not
handover the possession to the complainant.
3. Despite several requests and reminders, the accused did not handover the
property. Thereafter, the accused agreed to return the amount and for the
said purpose, issued the cheque bearing no. 334592 dated 18.12.2023
amounting to Rs. 7,50,000/-, drawn on Canara Bank, Srinivaspuri, New
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Delhi, in favour of the complainant for repayment of the amount. The
complainant presented the cheque to his bank within the jurisdiction of
this court wherein the same was returned dishonoured with remarks
“Funds Insufficient” vide cheque return memo dated 21.12.2023.
Thereafter, the complainant issued a legal demand notice dated
06.01.2024 upon the accused demanding payment. Since no repayment
was made by the accused within stipulated 15 days from date of receipt of
legal demand notice, hence the present complaint was filed U/s. 138 NI
Act.
Proceedings Before the Court
4. On 07.10.2024, separate notice explaining the accusation was put to the
accused under Section 251 of the Code of Criminal Procedure, 1973
(hereinafter referred to as ‘CrPC’) to which he pleaded not guilty and
claimed trial.
5. At this stage, the accused admitted the signatures on the cheque but
denied filling up of the material particulars of the cheque in question. He
denied the receipt of the legal notice but admitted his address on the
same. He stated that he had sold one property to the complainant and had
taken Rs. 5 lakhs as token money from the complainant. Subsequently, he
stated that the complainant asked for some security and the cheque in
question was given to him as a blank signed cheque. It is further stated
that the complainant is well connected with the police and he exerted
pressure upon the accused to execute a compromise agreement wherein it
is written that in case the amount of Rs. 5 lakhs was not paid within a
certain time, the accused would be liable to pay Rs. 7,50,000/-. He stated
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that he had not returned the amount of Rs. 5,00,000/- to the complainant
but he was willing to return the same. He stated that he had no liability to
the tune of the amount of cheque in question.
6. In support of his case, the complainant deposed as CW-1 and tendered his
post summoning evidence affidavit i.e. Ex.CW1/1 and also relied upon
the documents namely original cheque i.e. Ex. CW1/A, return memo
dated 21.12.2023, i.e. Ex. CW1/B, legal notice dated 06.01.2024, i.e. Ex.
CW1/C, postal receipts, i.e. Mark D, Tracking reports, Ex. CW1/E. In his
evidentiary affidavit, the complainant has reiterated the contents of his
complaint. Further, the cross examination of CW1 was conducted and he
was discharged. Thereafter CE was closed.
7. All the incriminating evidence was put before the accused and the
statement of accused u/s 313 Cr.PC was recorded. The accused reiterated
and elaborated on the defence disclosed by him at the stage of framing of
notice under Section 251 CrPC. The accused admitted that there was an
agreement to sell the ground floor of the property, for which the
complainant had given him Rs. 4,90,000/- in cash and Rs. 10,000/- in his
account. He stated that the complainant had told him that the rest of the
payment qua the amount of Rs. 7,50,000/- shall be given by the next
morning. Thereafter, it is stated that the complainant did not come for
around 2-4 days and informed thereafter that he did not want to purchase
the property. He further stated that he told the complainant that he would
return the amount of Rs. 5 lakhs to the accused only after selling the
property and the accused sought a blank signed security cheque from him
for the purpose. He stated that he handed over the cheque in question
after filling up the date on the same. He denied the receipt of the legal
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demand notice but admitted his address on the same. He stated that he
only owed the liability of Rs. 5,00,000/- towards the complainant.
8. The accused opted to lead DE. However, thereafter, on 13.02.2026, the
accused stated that he did not wish to lead DE. Matter was listed for final
arguments thereafter.
9. Final arguments were heard from both the parties. During the course of
final arguments, Ld. Counsel for the complainant submitted that:
9.1. The complainant has duly proved his case and the accused has been
unable to discharge the burden of proof.
9.2. The accused has duly admitted the property transaction and has
merely stated that the amount given to the complainant was Rs.
5,00,000/-.
9.3. The accused had admitted his address on the legal notice even
while denying the receipt of the same.
9.4. All statutory requirements u/s 138 NI Act are complete.
10.Per Contra, Ld. Counsel for the accused prayed that the accused be
acquitted. The points raised by ld. Counsel for the accused during his
final arguments are as follows:
10.1. The complainant alleges that the amount in question was given for
purchase of property. However, no document has been placed om
record showing the sale/purchase.
10.2. In his cross-examination, the complainant stated that he obtained
Rs. 7.5 lakhs after sale of property but no details were given as to
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what property was sold by the complainant and for how much, to
manage the source of funds.
10.3. The complainant also stated in his corss-examination that the
amount was gioven in the presence of two witnesses, i.e. Fazal
Khan and Liyakat Ali. Neither of these witnesses were brought
forward to prove the transaction.
10.4. The accused has successfully rebutted the presumption u/s 118 and
139 of NI Act.
11.I have heard the counsels for both the parties, considered the evidence led
by them carefully and have perused the court records thoroughly.
12. Before going 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 complainant must
fulfil all the essential ingredients of the offence as laid down by the
Hon’ble Supreme Court of India in Gimpex Private Limited vs. Manoj
Goel (2022) 11 SCC 705, as highlighted below:
“1st Ingredient: The cheque was drawn by a person on
an account maintained by him/her 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;
2nd Ingredient: The cheque was drawn by the drawer
for discharge of any legally enforceable debt or other
liability;
3rd Ingredient: The cheque was returned unpaid by the
bank due to either insufficiency of funds in the account
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to honour the cheque or that it exceeds the amount
arranged to be paid from that account on an agreement
made with that bank;
4th 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;
5th Ingredient: The drawer fails to make payment of the
said amount of money within fifteen days from the date
of receipt of notice."
13.The cheque herein was dated 25.02.2024 and was dishonoured vide return
memo dated 04.03.2024. Thereafter, the complainant sent a legal demand
notice dated 26.03.2024 to the accused demanding to make payment of
the cheque amount. Upon non-payment, the present case was filed. Prima
facie, therefore, it appears that the complaint is well within the period of
limitation and the prescribed period for procedure u/s 138 has been duly
complied with.
14.So far as the first and third ingredients aforesaid are concerned, the
accused has admitted the cheque in question, his signatures, as well as the
return memo, at the stage of framing of notice u/s 251 CrPC as well as in
his admission u/s 294 CrPC. Further, the cheque in question was returned
unpaid due to the reason, “Drawers’ Sign not as per mandate,” which falls
within the ambit of Section 138 NI Act. In view of the above, the first and
third ingredients of the offence under Section 138 NI Act, as mentioned
above, stand proved.
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15.So far as the fourth and fifth ingredients are concerned, the accused has
denied the receipt of legal notice, but has admitted the address on the said
notice. Perusal of tracking report shows that the legal notice has been
duly delivered. In view of the fact that the tracking report is exhibited,
and in light of the presumption under Section 114 of the Indian Evidence
Act, the burden is on the accused to prove that service of the said demand
notice was not made. However, the accused has merely denied the receipt
of legal notice while admitting the address on the legal notice. Bare
denial of receipt cannot be said to prove that the demand notice had not
been received by the accused.
16. Moreover, as per mandate of
C.C. Alavi Haji vs Palapetty Muhammed &
Anr.(2007) 6 SCC 555, the accused didn't make the payment within 15
days of receipt of the summons from the Court and thus he cannot
contend that there was no proper service of notice as required
under Section 138. When the notice is sent by registered post by correctly
addressing the drawer of the cheque, the mandatory requirement of issue
of notice in terms of Clause (b) of proviso to Section 138 of the Act
stands complied with. As such, the fourth and fifth ingredients also stand
proved.
17.In the light of the defence put forth by the accused, the decision of this
case is dependent on the determination of the sole issue, i.e. Whether the
cheque in question was issued to discharge a legally recoverable debt.
18.In view of the above discussion, the presumptions under Section 118 and
139 of Negotiable Instruments Act come into effect and it is presumed
that the cheque in question was drawn for consideration and that the
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cheque had been given to the holder in discharge of a legally enforceable
debt or liability.
19.Before delving into the defence of the accused, it is imperative to discuss
the law regarding the standard of proof required to discharge the burden
of presumption under Section 139 NI Act. The Hon’ble Supreme Court,
in the case of Rajesh Jain v. Ajay Singh 2021 SCC OnLine SC 1275 has
discussed the law on this point in detail, stating:
“40. The standard of proof to discharge this evidential
burden is not as heavy as that usually seen in situations
where the prosecution is required to prove the guilt of
an accused. The accused is not expected to prove the
non-existence of the presumed fact beyond reasonable
doubt. The accused must meet the standard of
‘preponderance of probabilities’, similar to a defendant
in a civil proceeding.
41. In order to rebut the presumption and prove to the
contrary, it is open to the accused to raise a probable
defence wherein the existence of a legally enforceable
debt or liability can be contested. The words ‘until the
contrary is proved’ occurring in Section 139 do not
mean that accused must necessarily prove the negative
that the instrument is not issued in discharge of any
debt/liability but the accused has the option to ask the
Court to consider the non-existence of debt/liability so
probable that a prudent man ought, under the
circumstances of the case, to act upon the supposition
that debt/liability did not exist.
42. In other words, the accused is left with two options.
The first option-of proving that the debt/liability does
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not exist-is to lead defence evidence and conclusively
establish with certainty that the cheque was not issued
in discharge of a debt/liability. The second option is to
prove the non-existence of debt/liability by a
preponderance of probabilities by referring to the
particular circumstances of the case. The preponderance
of probability in favour of the accused's case may be
even fifty one to forty nine and arising out of the entire
circumstances of the case, which includes: the
complainant's version in the original complaint, the case
in the legal/demand notice, complainant's case at the
trial, as also the plea of the accused in the reply notice,
his 313 statement or at the trial as to the circumstances
under which the promissory note/cheque was executed.
All of them can raise a preponderance of probabilities
justifying a finding that there was ‘no debt/liability’”
20.Thus, it is established position of law that to rebut the presumption under
Section 139 NI Act, the standard of proof is that of preponderance of
probabilities and that the accused may rely on circumstantial evidence to
prove the same. The preponderance of probabilities must be adjudged on
the basis of the complainant’s case as well as the defence of the accused.
21.In the present case, the accused has duly admitted the oral agreement to
sell the ground floor of the property in question. The accused has further
admitted the receipt of money from the complainant for the said purpose
but states that the amount given by the complainant was only Rs.
5,00,000/-. The accused has also stated that the complainant had exerted
pressure on him to execute a compromise agreement wherein it was
written that if he did not pay the sum of Rs. 5 lakhs within a certain time,
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he shall be liable to pay Rs. 7.5 lakhs to the complainant. However, the
said compromise has not been placed on record either by the complainant
or the accused. The accused has admitted all the facts surrounding the
transaction, while only disputing the amount and stating that his liability
is limited to the amount of Rs. 5,00,000/-. The accused has not led any
evidence to support his defence and has not even been able to point out
any inconsistencies in the version of the complainant.The fact that the
complainant has not called the witnesses to the transaction is irrelevant as
the initial burden of proof is on the accused to show that the cheque was
not issued in discharge of a legally enforceable liability or that the
amount filled up on the cheque was enhanced.
22.During the cross-examination of CW-1, as well as at the stage of final
arguments, the accused has challenged the source of funds and financial
capacity of the complainant. However, the fact remains that the accused
himself has duly admitted the receipt of Rs. 5,00,000/- from the
complainant. The Hon’ble Supreme Court of India, in
Ashok Singh
Versus State Of Uttar Pradesh & Anr., CRIMINAL APPEAL NO.4171
OF 2024; APRIL 02, 2025, has reiterated the position of law in this
regard, while stating that:
“The onus is not on the complainant at the threshold
to prove his capacity/financial wherewithal to make
the payment in discharge of which the cheque is
alleged to have been issued in his favour. Only if an
objection is raised that the complainant was not in a
financial position to pay the amount so claimed by
him to have been given as a loan to the accused, only
then the complainant would have to bring before the
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Court cogent material to indicate that he had the
financial capacity and had actually advanced the
amount in question by way of loan…”,
23. Reliance can be also be placed in this regard on
M/s S. S. Production v.
Tr. Pavithran Prasanth, 2024 INSC 1059, wherein it has been observed
that:
“Just by taking a counter-stand to raise a probable
defence would not shift the onus on the complainant
in such a case for the plea of defence has to be
buttressed by evidence, either oral or documentary,
which in the present cases, has not been done.
Moreover, even if it is presumed that the
complainant had not proved the source of the money
given to the petitioners by way of loan by producing
statement of accounts and/or Income Tax Returns,
the same ipso facto, would not negate such claim for
the reason that the cheques having being issued and
signed by the petitioners has not been denied, and no
evidence has been led to show that the respondent
lacked capacity to provide the amount(s) in
question”
24.It is clear that the defence of the accused is based on mere averments and
is not supported by any cogent evidence. It is an established position of
law that mere averments, not substantiated by proof, are not sufficient to
dislodge the presumption u/s 138 NI Act. Hence, in the absence of other
corroborative evidence, the defence presented by the accused is not
enough to discharge the burden of preponderance of probabilities to rebut
the presumption under Section 118 and 139 of Negotiable Instruments
Act.
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Conclusion and Findings
25.In adherence to the law laid down in
Rajesh Jain v. Ajay Singh (supra), I
have considered the complainant's version in the original complaint, the
case in the legal notice, complainant's case at the trial, the statement of
accused u/s 313 CrPC or at the trial as to the circumstances under which
the cheque was executed. Having considered all the above it is clear that
the defence of the accused is based on a bare denial of the averments
made in the complaint and that the defence raised by the accused has not
been proved at any stage, nor has the accused been able to prove the non-
existence of debt/liability by a preponderance of probabilities by referring
to the particular circumstances of this case. In the light of the
observations, it is clear that the accused has not been able to rebut the
presumption raised against him by virtue of Section 118 and 139 of
Negotiable Instruments Act, even on a scale of preponderance of
probabilities.
26.In view of the evidence adduced, documents put forth and arguments
advanced by the parties and further in view of the above discussion, this
court is of the considered view that the accused Waseem Raja is guilty of
offence under Section 138 of Negotiable Instruments Act and is hereby
convicted under Section 138 NI Act.
27.Let the convict be heard separately on the quantum of sentence.
Copy of judgment be provided free of cost to both the parties.
Announced in Open Court today.
(Akanksha Singh)
JMFC(NIAct)-02-PHC
NDD-ND-31.07.2026
This Judgment consists of 14 pages and each page has been digitally signed by me.
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