TaxTMI 
TaxTMI 
2026 (6) TMI 1469
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....sp; petitioner-accused (hereinafter referred to as the 'accused') guilty of his having committed an offence punishable under Section 138 of the Negotiable Instruments Act (for short 'Act'), convicted and sentenced him to undergo simple imprisonment for a period of six months and pay fine of Rs. 15, 70,000/-, out of which, sum of Rs. 15,50,000/- to be paid as compensation to the complainant and in default to further undergo simple imprisonment for six months. 2. Precisely, the facts of the case, as emerge from the pleadings as well as other documents adduced on record by the respective parties, are that the complainant-bank filed a complaint under Section 138 of the Act in the competent Court of law, alleging therein that accused approached the complainant-bank for grant of term loan of Rs. 50, 00,000/- for purchase of two new AMW Tippers. Complainant-bank agreed to aforesaid request of the accused and sanctioned/advanced a term loan of Rs. 50, 00,000/- on the same day pursuant to execution of necessary documents by the accused in favour of the complainant-bank. As per agreement, accused was under obligation to repay the loan amount alongwith interest in 58 equal monthly in....
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....ied with. Repeatedly, matter was adjourned, enabling petitioner to comply with aforesaid order, but in vain. Hence, this Court has no option, but to decide the petition on its own merit. 5. Having heard learned counsel representing the parties and perused material available on record vis-à-vis reasoning assigned in the impugned judgment passed by learned Additional Sessions Judge, Ghumarwin, District Bilaspur, Himachal Pradesh, affirming judgment of conviction and order of sentence recorded by learned trial Court, this Court is not persuaded to agree with learned counsel for the petitioner that both the Courts below have failed to appreciate the evidence in its right perspective, rather this Court is convinced and satisfied that both the Courts below have meticulously dealt with each and every aspect of the matter and there is no scope left for interference. 6. Interestingly, in the case at hand, factum with regard to issuance of cheque as well as signatures thereupon never came to be disputed and as such, no illegality can be said to have been committed by the Courts below while, invoking Sections 118 and 139 of the Act, which speak about presumption in favour of the ....
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....s a probable defence nor is able to contest existence of a legally enforceable debt or liability, statutory presumption under Section 139 of the Negotiable Instruments Act, regarding commission of the offence comes into play. It would be profitable to reproduce relevant paras No.23 to 25 of the judgment herein:- "23. Further, a three judge Bench of this Court in the matter of Rangappa vs. Sri Mohan [3] held that Section 139 is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies the strong criminal remedy in relation to the dishonour of the cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. The Court however, further observed that it must be remembered that the offence made punishable by Section 138can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose money is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should gui....
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.... that dishonour of cheque issued as "security" can also attract offence under Section 138 of the Negotiable Instruments Act. Hon'ble Apex Court in case titled Sripati Singh v. State of Jharkhand, Criminal Appeal No. 1269-1270 of 2021, decided on 28.10.2021, has held as under: "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 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....