Mr. Gaurav Goel and Mr. Abhishek Sharma, Advocates v. THE STATE

Judgment

1. The present revision petition under Section 442 of the Bharatiya Nagarik Suraksha Sanhita, 20231 is directed against the impugned judgement dated 21st February, 2025 passed by the Additional Sessions Judge-05, Central District, Tis Hazari Courts, Delhi in C.A. 111/2024 titled “Krishan Singh v. State and Ors.”, whereby the conviction of the Petitioner for the offence under Section 138 of the Negotiable Instruments Act, 18812 has been upheld with modification of the sentence awarded.

Factual Background

2. The facts leading to the filing of the present petition are as follows:

2.1 Respondent No. 2 filed a criminal complaint case under Section 138 of the NI Act alleging that the Petitioner had obtained a loan of ₹4,00,000 for the purchase of a vehicle. The terms of repayment, including interest and 1 “CrPC” 2 “NI Act” CRL.REV.P.(NI) 99/2025 Page 1 of 12 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 16/04/2025 at 12:39:50 overdue charges, were reduced to writing in a Vehicle Lease Agreement, under which the Petitioner was to repay the loan in 30 monthly instalments of ₹17,600 each.

2.2 The Petitioner allegedly defaulted in making timely payments, leading to the accrual of overdue charges. As per the statement of account placed on record by Respondent No. 2, an amount of ₹3,16,100/- was outstanding against the Petitioner, who, despite repeated demands, failed to repay.

2.3 In purported discharge of the aforementioned liability, the Petitioner issued a cheque dated 13th July, 2014, for ₹3,16,500/- in favour of Respondent No. 2. However, on 21st July, 2014, the cheque was dishonoured and returned unpaid on presentation.

2.4 A legal notice dated 24th July 2014 was issued by Respondent No. 2 demanding payment, which the Petitioner failed to honour, resulting in the initiation of the complaint proceedings.

2.5 The Petitioner was summoned and notice under Section 251 CrPC was framed. The Petitioner pleaded not guilty and sought to contest the matter.

2.6 Upon consideration of the material and evidence on record, the Trial Court, by order dated 7th February, 2024, found the Petitioner guilty of the offence under Section 138 NI Act. Subsequently, by order dated 22nd February, 2024, the Petitioner was sentenced to a term of simple imprisonment for three months and directed to pay a fine of ₹4.15 lakhs, which included the interest component and litigation costs. In default of payment, the Petitioner was directed to undergo an additional term of simple imprisonment for a period of three months.

2.7 Aggrieved by the judgment of conviction and the sentencing order, CRL.REV.P.(NI) 99/2025 Page 2 of 12 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 16/04/2025 at 12:39:50 the Petitioner filed an appeal before the Court of Additional Sessions Judge3. By impugned judgment dated 21st February 2025, the Appellate Court upheld the conviction recorded by the Trial Court, but modified the sentence to the following extent: “26. As a result, the judgment of conviction dated 07.02.2024 is upheld and the appeal against the judgment of conviction dated 07.02.2024 is hereby dismissed. However, the appeal on the aspect of the orders on sentence dated 22.02.2024 is partly allowed to the extent that the appellant/ convict shall pay the fine of Rs. 4.15 lacs as directed by the ld. Trial court vide orders on sentence dated 22.02.2024 and in default of the payment of fine, the appellant shall also undergo the sentence of three months SI as directed by the ld. Trial court. The sentence of three months SI together with the fine of Rs. 4.15 lacs is hereby dispensed with.

27. In the light of the above said discussion, the appeal stands partly allowed on the aspect of sentence only. The appellant shall comply with the judgment dated 07.02.2024 and the orders on sentence dated 22.02.2024 subject to the modification by virtue of the orders passed by this court as on date.”

2.8 Dissatisfied, the Petitioner has filed the present revision petition seeking setting aside of the impugned order. Petitioner’s Case

3. Counsel for the Petitioner challenges the impugned order of conviction on the following grounds:

3.1 Respondent No. 2, during cross-examination, admitted that the outstanding amount owed by the Petitioner was ₹2,80,100/-. However, the impugned cheque was issued for a sum of ₹3,16,500/-. Since the cheque amount exceeded the admitted debt, the prosecution under Section 138 of the NI Act, falls outside the scope of the statute, which requires a legally enforceable debt or liability. 3 “ASJ” CRL.REV.P.(NI) 99/2025 Page 3 of 12 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 16/04/2025 at 12:39:50

3.2 The signature on the disputed cheque is entirely different from the signature on the acknowledgment deed, which constitutes an act of forgery by Respondent No. 2.

3.3 The Petitioner had deposited 30 cheques with Respondent No. 2 at the time of securing the loan against the vehicle. However, Respondent No. 2 misused these cheques by forging the Petitioner’s signature on the cheques, for amounts exceeding the legally recoverable amount.

3.4 The vehicle against which the loan was secured, was also repossessed by Respondent No. 2 in a clandestine manner. Consequently, the outstanding loan amount should be duly adjusted to account for the repossession.

3.5 No written notice was served on the Petitioner within the 30-day period following the dishonour of the cheque, as required under Section 138 NI Act.

3.6 The bank return memo filed by Respondent No. 2 does not have the signature of the bank official and appears to be a handwritten or typed forged slip, allegedly fabricated to cheat the Petitioner. Analysis

4. The Court has considered the submissions advanced by the Petitioner. The Petitioner seeks to invoke the revisional jurisdiction of this Court under Section 397 CrPC for challenging the concurrent findings of the Trial Court as well as the Appellate Court, holding him guilty for the offence under Section 138 NI Act. At the outset, it is pertinent to highlight the circumscribed scope of revisional jurisdiction, which can only be exercised in cases where there is perversity or unreasonableness, miscarriage of justice, or a complete misreading of records in the findings of the lower courts. The High Court, in revisional jurisdiction, does not sit as a court of CRL.REV.P.(NI) 99/2025 Page 4 of 12 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 16/04/2025 at 12:39:50 appeal to re-evaluate the findings of the lower courts. The Supreme Court in State of Kerala Vs. Puttumana Illath Jathavedan Namboodiri,4 underscored the scope of revisional jurisdiction of the High Court, to the following effect: “5. ……… In other words, the jurisdiction is one of supervisory jurisdiction exercised by the High Court for correcting miscarriage of justice. But the said revisional power cannot be equated with the power of an appellate court nor can it be treated even as a second appellate jurisdiction. Ordinarily, therefore, it would not be appropriate for the High Court to reappreciate the evidence and come to its own conclusion on the same when the evidence has already been appreciated by the Magistrate as well as the Sessions Judge in appeal, unless any glaring feature is brought to the notice of the High Court which would otherwise to gross miscarriage of tantamount justice………….”

5. This view was reiterated in Amit Kapoor v. Ramesh Chander,5 wherein the Supreme Court emphasized that unlike Section 482 CrPC, the jurisdiction under Section 397 can only be exercised where there is palpable error, non-compliance with the provisions of law, or where judicial discretion is exercised arbitrarily. Similarly, in New India Assurance Co. Ltd. Vs. Krishna Kumar Pandey,6 the Supreme Court highlighted that the purpose of the revisional power is to correct a patent defect or an error of jurisdiction of law.

6. With the legal framework clearly delineated, the Court turns to the merits of the conviction and the Petitioner’s challenge thereto. In this regard, it is pertinent to refer to the detailed findings recorded by the Trial Court: “15. Coming to the facts of the present case, the accused in his plea of defence at the time of notice has admitted the signatures on the cheques in question. Therefore, the Act raises two presumptions in favour of the holder

Factual Background

2. The facts leading to the filing of the present petition are as follows:

2.1 Respondent No. 2 filed a criminal complaint case under Section 138 of the NI Act alleging that the Petitioner had obtained a loan of ₹4,00,000 for the purchase of a vehicle. The terms of repayment, including interest and 1 “CrPC” 2 “NI Act” CRL.REV.P.(NI) 99/2025 Page 1 of 12 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 16/04/2025 at 12:39:50 overdue charges, were reduced to writing in a Vehicle Lease Agreement, under which the Petitioner was to repay the loan in 30 monthly instalments of ₹17,600 each.

2.2 The Petitioner allegedly defaulted in making timely payments, leading to the accrual of overdue charges. As per the statement of account placed on record by Respondent No. 2, an amount of ₹3,16,100/- was outstanding against the Petitioner, who, despite repeated demands, failed to repay.

2.3 In purported discharge of the aforementioned liability, the Petitioner issued a cheque dated 13th July, 2014, for ₹3,16,500/- in favour of Respondent No. 2. However, on 21st July, 2014, the cheque was dishonoured and returned unpaid on presentation.

2.4 A legal notice dated 24th July 2014 was issued by Respondent No. 2 demanding payment, which the Petitioner failed to honour, resulting in the initiation of the complaint proceedings.

2.5 The Petitioner was summoned and notice under Section 251 CrPC was framed. The Petitioner pleaded not guilty and sought to contest the matter.

2.6 Upon consideration of the material and evidence on record, the Trial Court, by order dated 7th February, 2024, found the Petitioner guilty of the offence under Section 138 NI Act. Subsequently, by order dated 22nd February, 2024, the Petitioner was sentenced to a term of simple imprisonment for three months and directed to pay a fine of ₹4.15 lakhs, which included the interest component and litigation costs. In default of payment, the Petitioner was directed to undergo an additional term of simple imprisonment for a period of three months.

2.7 Aggrieved by the judgment of conviction and the sentencing order, CRL.REV.P.(NI) 99/2025 Page 2 of 12 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 16/04/2025 at 12:39:50 the Petitioner filed an appeal before the Court of Additional Sessions Judge3. By impugned judgment dated 21st February 2025, the Appellate Court upheld the conviction recorded by the Trial Court, but modified the sentence to the following extent: “26. As a result, the judgment of conviction dated 07.02.2024 is upheld and the appeal against the judgment of conviction dated 07.02.2024 is hereby dismissed. However, the appeal on the aspect of the orders on sentence dated 22.02.2024 is partly allowed to the extent that the appellant/ convict shall pay the fine of Rs. 4.15 lacs as directed by the ld. Trial court vide orders on sentence dated 22.02.2024 and in default of the payment of fine, the appellant shall also undergo the sentence of three months SI as directed by the ld. Trial court. The sentence of three months SI together with the fine of Rs. 4.15 lacs is hereby dispensed with.

27. In the light of the above said discussion, the appeal stands partly allowed on the aspect of sentence only. The appellant shall comply with the judgment dated 07.02.2024 and the orders on sentence dated 22.02.2024 subject to the modification by virtue of the orders passed by this court as on date.”

2.8 Dissatisfied, the Petitioner has filed the present revision petition seeking setting aside of the impugned order. Petitioner’s Case

3. Counsel for the Petitioner challenges the impugned order of conviction on the following grounds:

3.1 Respondent No. 2, during cross-examination, admitted that the outstanding amount owed by the Petitioner was ₹2,80,100/-. However, the impugned cheque was issued for a sum of ₹3,16,500/-. Since the cheque amount exceeded the admitted debt, the prosecution under Section 138 of the NI Act, falls outside the scope of the statute, which requires a legally enforceable debt or liability. 3 “ASJ” CRL.REV.P.(NI) 99/2025 Page 3 of 12 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 16/04/2025 at 12:39:50

3.2 The signature on the disputed cheque is entirely different from the signature on the acknowledgment deed, which constitutes an act of forgery by Respondent No. 2.

3.3 The Petitioner had deposited 30 cheques with Respondent No. 2 at the time of securing the loan against the vehicle. However, Respondent No. 2 misused these cheques by forging the Petitioner’s signature on the cheques, for amounts exceeding the legally recoverable amount.

3.4 The vehicle against which the loan was secured, was also repossessed by Respondent No. 2 in a clandestine manner. Consequently, the outstanding loan amount should be duly adjusted to account for the repossession.

3.5 No written notice was served on the Petitioner within the 30-day period following the dishonour of the cheque, as required under Section 138 NI Act.

3.6 The bank return memo filed by Respondent No. 2 does not have the signature of the bank official and appears to be a handwritten or typed forged slip, allegedly fabricated to cheat the Petitioner. Analysis

4. The Court has considered the submissions advanced by the Petitioner. The Petitioner seeks to invoke the revisional jurisdiction of this Court under Section 397 CrPC for challenging the concurrent findings of the Trial Court as well as the Appellate Court, holding him guilty for the offence under Section 138 NI Act. At the outset, it is pertinent to highlight the circumscribed scope of revisional jurisdiction, which can only be exercised in cases where there is perversity or unreasonableness, miscarriage of justice, or a complete misreading of records in the findings of the lower courts. The High Court, in revisional jurisdiction, does not sit as a court of CRL.REV.P.(NI) 99/2025 Page 4 of 12 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 16/04/2025 at 12:39:50 appeal to re-evaluate the findings of the lower courts. The Supreme Court in State of Kerala Vs. Puttumana Illath Jathavedan Namboodiri,4 underscored the scope of revisional jurisdiction of the High Court, to the following effect: “5. ……… In other words, the jurisdiction is one of supervisory jurisdiction exercised by the High Court for correcting miscarriage of justice. But the said revisional power cannot be equated with the power of an appellate court nor can it be treated even as a second appellate jurisdiction. Ordinarily, therefore, it would not be appropriate for the High Court to reappreciate the evidence and come to its own conclusion on the same when the evidence has already been appreciated by the Magistrate as well as the Sessions Judge in appeal, unless any glaring feature is brought to the notice of the High Court which would otherwise to gross miscarriage of tantamount justice………….”

5. This view was reiterated in Amit Kapoor v. Ramesh Chander,5 wherein the Supreme Court emphasized that unlike Section 482 CrPC, the jurisdiction under Section 397 can only be exercised where there is palpable error, non-compliance with the provisions of law, or where judicial discretion is exercised arbitrarily. Similarly, in New India Assurance Co. Ltd. Vs. Krishna Kumar Pandey,6 the Supreme Court highlighted that the purpose of the revisional power is to correct a patent defect or an error of jurisdiction of law.

6. With the legal framework clearly delineated, the Court turns to the merits of the conviction and the Petitioner’s challenge thereto. In this regard, it is pertinent to refer to the detailed findings recorded by the Trial Court: “15. Coming to the facts of the present case, the accused in his plea of defence at the time of notice has admitted the signatures on the cheques in question. Therefore, the Act raises two presumptions in favour of the holder