Mere signing of cheque not sufficient to prove offence under NI Act, says court

Mere signing of a cheque is not sufficient to conclude the commission of offence under Section 138 of the Negotiable Instruments (NI) Act. While observing this, Riffi Bhatti, Civil Judge, Chandigarh, has acquitted one Bal Krishan, a resident of Maloya, after the complainant failed to prove charges.

In the complaint filed before the court, Rajesh Chauhan said the accused was engaged in property business. He failed to deliver an agreed property to him. The accused, in order to return the amount paid by him, issued cheque to him.

When he presented the cheque it was dishonoured on October 20, 2019, with remarks “funds Insufficient”. The counsel for the complainant argued that signature on the cheque of the accused, therefore, a legal presumption under NI Act arises against the accused which the accused has failed to rebut. The cheque was issued for the discharge of his liability. On the other hand, Palvinder Singh, counsel for the accused, has argued that the accused is neither working as property dealer nor has taken any amount from the complainant at any point of time. The complainant misused the blank security cheque of accused, which were given as security.

He has also argued that the accused has no legal liability against the cheque. He argued that the accused is not liable to make any payment to the complainant and a false complaint on the false grounds has been filed only to grab the money from the accused. After hearing the contentions of the parties the court acquitted the accused in the case.

The court said the complainant failed to prove that the cheque was issued by the accused in discharge of legally enforceable debt or liability. In the legal notice, the complainant has neither mentioned about execution of any agreement to sell or date of any agreement for purchase of property with the accused nor about any description of property intended to be purchased by him through the accused. The court said no doubt signature on the cheque in is admittedly of the accused but mere signing of the cheque is not sufficient to conclude the commission of offence under Section 138 of NI Act. Thus, the essential ingredient of the offence punishable under Section 138 of NI Act i.e. issuance of cheque in discharge of legally recoverable debt/liability by the accused remained unproved which the complainant was required to prove at the yardstick of ‘beyond reasonable doubt’. Consequently, the present complaint is dismissed and the accused is acquitted of the notice of accusation served upon him.