Safiya Malik

The High Court of Delhi, in a recent judgment, has set aside the discharge order of a respondent in a cheque dishonour case and restored the trial proceedings. The judgment, delivered by a Single Bench presided over by Justice Neena Bansal Krishna, addresses key legal aspects under the Negotiable Instruments Act, 1881 (NI Act), including the validity of legal notices and the interpretation of discrepancies in cheque amounts.

The case concerns a complaint filed under Section 138 of the NI Act by the petitioner, Nitesh Yadav, against the respondent, Sonu Rana. The petitioner alleged that a cheque amounting to Rs. 4,65,000/-, issued by the respondent to settle a loan of Rs. 5,00,000/-, was dishonoured with the bank returning it marked "payment stopped by the drawer."

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The respondent was initially summoned by the Metropolitan Magistrate (MM) on September 24, 2019. He later sought discharge on the grounds that:

1. The cheque contained an overwritten date, amounting to material alteration under Section 87 of the NI Act, rendering it void.

2. There was a discrepancy in the amount mentioned in figures (Rs. 4,65,000/-) and words ("Rupees Four Lac Sixty-Five only"). Under Section 18 of the NI Act, when a discrepancy exists, the amount in words prevails, making the cheque legally enforceable for Rs. 4,00,065/- instead of Rs. 4,65,000/-. The demand notice issued on January 27, 2018, sought Rs. 4,65,000/-, which did not match the valid cheque amount, thus invalidating the notice.

The learned MM, in its order dated September 24, 2018, held that the discrepancy in the amount was a matter to be decided at trial and proceeded to frame notice against the respondent. However, in a revision petition, the Additional Sessions Judge (ASJ) on February 17, 2021, stated that the complainant failed to establish the correct cheque amount and quashed the MM’s summoning order, thereby discharging the respondent.

Aggrieved by this decision, the petitioner approached the Delhi High Court under Section 482 of the Code of Criminal Procedure, 1973 (Cr.P.C.), challenging the discharge order and seeking revival of the trial.

The High Court examined statutory provisions and judicial precedents to determine the validity of the ASJ’s decision. The Court noted that under Section 139 of the NI Act, once a cheque is signed and handed over, there is a presumption that it was issued for a valid debt or liability unless rebutted by the accused. The Court referenced Uttam Ram v. Devinder Singh Hudan & Anr., where the Supreme Court held that even a blank cheque voluntarily signed and handed over attracts the presumption under Section 139, unless cogent evidence rebuts it.

The Court also considered the impact of "stop payment" instructions, noting that such instructions alone do not absolve the drawer from liability unless it is shown that sufficient funds were available at the time of issuing the cheque and its presentation. It cited Rangappa v. Sri Mohan (AIR 2010 SC 1898), which held that Section 139 of the NI Act imposes a reverse burden of proof on the accused.

On the issue of the discrepancy in the cheque amount, the Court observed:

"Though the figure in numerical has been clearly written as Rs. 4,65,000/-, while writing in words it was stated as ‘Four lac sixty-five.’ It is evident that there has been an inadvertence in omitting the word ‘thousand.’ This appears to be an unintentional omission rather than an attempt to depict a different amount."

The Court further pointed out that the return memo from the bank explicitly mentioned that the cheque was for Rs. 4,65,000/- and was dishonoured due to "payment stopped." Thus, it held that:

"Reading the Notice, the cheque, and the Bank Memo together, it is evident that the cheque amount was Rs. 4,65,000/-, which is the amount mentioned in the Legal Notice."

The High Court also referenced Central Bank of India & Anr. v. M/s. Saxons Farms & Ors., wherein the Supreme Court stated that the purpose of a legal notice under Section 138 of the NI Act is to give the drawer an opportunity to rectify the omission. If the demand notice specifies the cheque amount clearly, additional claims in the notice do not necessarily invalidate it.

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Based on the above observations, the High Court held that the learned ASJ had erred in discharging the respondent at the preliminary stage without affording the parties an opportunity to present their cases at trial. Consequently, the Court issued the following orders:

1. The order of the ASJ dated February 17, 2021, is set aside.

2. The complaint under Section 138 of the NI Act is restored.

3. The matter is remanded to the learned Metropolitan Magistrate for trial.

4. The parties are directed to appear before the learned MM at Rohini District Court, Delhi, on March 20, 2025.

Advocates Representing the Parties

• For the Petitioner: Mr. Shafiq Khan, Advocate

• For the State: Mr. Ajay Vikram Singh, Additional Public Prosecutor

• For Respondent No.2: Mr. Rajpal Singh & Mr. Rohit Kumar, Advocates

Case Title: Nitesh Yadav v. State NCT of Delhi & Anr.

Neutral Citation: 2025: DHC:1580

Case Number: CRL.M.C. 1140/2021

Bench: Justice Neena Bansal Krishna

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