Shriram Finance v. Balwinder Singh

Judgment

#1. Prayer in the petition under Section 528 of Bhartiya Prayer in the petition under Nagarik Suraksha Sanhita, 2023 is for quashing of Nagarik Suraksha Sanhita, 2023 is for quashing of summoning order dated 22.04.2025 of learned JMIC, Amritsar in NACT-35-2025 titled dated 22.04.2025 of learned JMIC, Amritsar dated 22.04.2025 of learned JMIC, Amritsar ‘Shriram Finance vs. Balwinder Singh’ under Section 138 of ‘Shriram Finance vs. Balwinder Singh’ ‘Shriram Finance vs. Balwinder Singh’ Negotiable (hereinafter referred to as ‘NI Act’) Instruments Act, 1885 (hereinafter referred to as ‘NI Act’) and all incidental proceeding arising therefrom. and all incidental proceeding arising therefrom and all incidental proceeding arising therefrom

#2. Learned counsel for the petitioner submits that petitioner Learned counsel for the petitioner was summoned as an accused, to face trial under Section 138 of NI A was summoned as trial under Section 138 of NI Act filed by respondent. The summoning order was passed on complaint filed by respondent. The summoning order was passed on complaint without application of judicial mind, without recording any without application of jud icial mind, without recording any reasons. The complaint would reveal that entire case of the respondent was complaint would reveal that entire case of the respondent was

based on a loan agreement between the parties based on a loan agreement between parties, but the loan agreement was not placed on record nor was relied upon in the list of documents. was not placed on record nor was relied upon in the list of documents was not placed on record nor was relied upon in the list of documents loan agreement were also not reproduced in the Contents of the loan agreement were also not reproduced in the Contents of CRM-M-30351 30351-2025(O&M) 2 in what capacity the cheque was received complaint nor it was averred in what capacity the cheque was received complaint nor it was by the complainant or if it was against any by the complainant or against any legally enforceable debt. The complaint did not disclose when the loan was advanced, when the The complaint did not disclose when the loan was advanced, when the The complaint did not disclose when the loan was advanced, when the cheque was given to the respondent by the petitioner and whether the cheque was given to the respondent by the petitioner and whether the cheque was given to the respondent by the petitioner and whether the alleged cheque was in discharge of complete liability under the alleged cheque was in discharge of complete liability under the alleged cheque was in discharge of complete liability under the agreement or was merely part payment. Prima facie agreement or was merely part payme Prima facie, complaint did not disclose any cause of action to summon the petitioner to face trial under disclose any cause of action to summon the petitioner to face trial under disclose any cause of action to summon the petitioner to face trial under of NI Act. There was nothing in the complaint regarding Section 138 of NI Act. There was nothing in the complaint regarding Section 138 the transaction of the cheque, therefore, summoning of the petitioner the transaction of the cheque, therefore, summoning of the petitioner the transaction of the cheque, therefore, summoning of the petitioner vide impugned order dated was bad in law and the order ugned order dated 22.04.2025 was bad in law and the order deserved to be quashed. deserved to be quashed.

#3. Relevant for decision of the matter are the presumptions Relevant for decision of the matter are the presumptions egotiable instrument, as provided under Section 118 of attached to a Negotiable instrument, as provided under Section 118 of attached to the Negotiable Instruments Act, which reads as under:- the Negotiable Instruments Act, which read the Negotiable Instruments Act, which read S.118 Presumptions as to negotiable instruments: S.118 Presumptions as to negotiable instruments: Until the contrary the contrary is proved, is proved, following following presumptions shall be made: presumptions shall be made: (a) of consideration; that every negotiable instrument was of consideration; that every negotiable instrument was (a) made or drawn for consideration, and that every such made or drawn for consideration, and that every such instrument, when instrument, when it has been accepted, it has been accepted, indorsed, indorsed, negotiated or negotiated or transferred, was accepted, transferred, was accepted, indorsed, indorsed, negotiated or transferred for consideration; negotiated or transferred for consideration; (b) as to date; that every negotiable instrument bearing a date as to date; that every negotiable instrument bearing a date (b) was made or drawn on such date; was made or drawn on such date; CRM-M-30351 30351-2025(O&M) 3 (c) as to time of acceptance; that every accepted bill of tance; that every accepted bill of (c) exchange was accepted within a reasonable time after its exchange was accepted within a reasonable time after its date and before its maturity; (d) as to time of transfer; that every transfer of a negotiable as to time of transfer; that every transfer of a negotiable (d) instrument was made before its maturity; instrument was made before its maturity; (e) as to order of indorsements; that (e) as to order of indorsements; that the indorsements appearing upon a negotiable instrument were made in the appearing upon a negotiable instrument were made in the order in which they appear thereon; order in which they appear thereon; (f) as to stamp; that a lost promissory note, bill of exchange as to stamp; that a lost promissory note, bill of exchange (f) or cheque was duly stamped; (g) that holder is a holder in due course; that the holder of a that holder is a holder in due course; that the holder of a (g) negotiable instrument is a holder in due course: Provided negotiable instrument is a holder in due course: Provided that, where the instrument has been obtained from its that, where the instrument has been obtained from its lawful owner, or from any person in lawful custody lawful owner, or from any person in lawful custody thereof, by means of an SP offence or fraud, or has been thereof, by means of an SP offence or fraud, or has been obtained from the maker or acceptor thereof by means of obtained from the maker or acceptor an offence or fraud, or for unlawful consideration, the an offence or fraud, or for unlawful consideration, the burthen of proving that the holder is a holder in due course burthen of proving that the holder is a holder in due course lies upon him.

#4. Further, Section 139 of the Act reads as under:- Further, Section 139 of the Act reads as under Further, Section 139 of the Act reads as under

#139. Presumption in favour of holder.— 139. Presumption in favour of holder. be presumed, unless the contrary is proved, It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability. whole or in part, of any debt or other liability. CRM-M-30351 30351-2025(O&M) 4

#5. In Kusum Ingots & Alloys Kusum Ingots & Alloys Ltd. v. Pennar Peterson