CRL.REV.P. 723/2014 & connected matters Page 1 of 22

$~

* IN THE HIGH COURT OF DELHI AT NEW DELHI

% Judgment reserved on: 02.12.2025

Judgment pronounced on: 27.02.2026

Judgment uploaded on: 27.02.2026

+ CRL.REV.P. 723/2014

DHRVU VARMA & ANR. .....Petitioners

Through: Ms. Harvinder Chawdhary, Mr.

Nishesh Sharma, Mr. Atul

Kumar Yadav and Mr. Sahietya

Singh, Advocates

versus

J K VARMA & ANR. .....Respondents

Through: Mr. Sanjeev Mahajan and Ms.

Simran Rao, Advocates

+ CRL.REV.P. 724/2014

DHRUV VARMA & ANR. .....Petitioners

Through: Ms. Harvinder Chawdhary, Mr.

Nishesh Sharma, Mr. Atul

Kumar Yadav and Mr. Sahietya

Singh, Advocates

versus

J K VARMA & ANR. .....Respondents

Through: Mr. Sanjeev Mahajan and Ms.

Simran Rao, Advocates

+ CRL.REV.P. 725/2014

DHRUV VARMA & ANR. .....Petitioners

Through: Ms. Harvinder Chawdhary, Mr.

Nishesh Sharma, Mr. Atul

Kumar Yadav and Mr. Sahietya

CRL.REV.P. 723/2014 & connected matters Page 2 of 22

Singh, Advocates

versus

J K VARMA & ANR. .....Respondents

Through: Mr. Sanjeev Mahajan and Ms.

Simran Rao, Advocates

CORAM:

HON’BLE DR. JUSTICE SWARANA KANTA SHARMA

JUDGMENT

DR. SWARANA KANTA SHARMA, J

1. By way of these three revision petitions, the petitioner has

assailed his conviction for offence under Section 138 of the

Negotiable Instruments Act, 1881 [hereafter „NI Act‟], in Complaint

Cases Nos. 669/1/2007, 670/1/2007 and 671/1/2007, wherein the

petitioner was convicted and sentenced vide judgment dated

11.10.2012 and order on sentence dated 31.10.2012, by the learned

MM-02 (NI Act), South East District, Saket Courts, Delhi [hereafter

„Trial Court‟], which were upheld by way of the impugned judgment

dated 30.09.2024 passed in Criminal Appeal Nos. 18, 19 and 20 of

2014 by the learned ASJ-03, Patiala House Courts, Delhi [hereafter

„Appellate Court‟].

FACTUAL BACKGROUND

2. Brief facts of the case, as set out in the complaints filed under

Section 138 of the NI Act are as follows: The complainant

(respondent no. 1 herein) had filed complaint cases under Section 138

of the NI Act against five accused persons, i.e. M/s Vasu Tech

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Limited (accused no. 1), Sh. Dhruv Varma (accused no. 2 and

petitioner no. 1 herein), Sh. R.L. Varma (accused no. 3), Smt. Aruna

Varma (accused no. 4) and M/s Ratan Lal Varma & Sons (HUF)

(accused no. 5 and petitioner no. 2 herein). It was alleged that the

complainant had entered into an agreement to sell dated 19.10.2001

with accused no. 5 in respect of a flat/space admeasuring 4000 sq. ft.

super area on the 4th Floor of Gopal Das Bhawan, 28, Barakhamba

Road, New Delhi, for a total sale consideration of ₹40,00,000/-. An

amount of ₹5,00,000/- was paid as advance consideration by cheque,

and since the premises was under tenancy of M/s Indo Rama

Synthetics (I) Ltd., it was agreed that the rent of the said portion

would stand assigned to the complainant. The balance sale

consideration of ₹35,00,000/- was paid by the complainant partly in

cash and partly through security transfer, whereupon a flat buyer

agreement was executed. A separate receipt acknowledging receipt of

the balance amount was executed by accused no. 2 on behalf of and

duly authorised by accused no. 5. At the time of execution of the flat

buyer agreement, accused nos. 2 to 4 requested the complainant not to

claim rent of about ₹2,50,000/- per month, representing that their

closely held family company, accused no. 1, was in urgent need of

funds for development of a technological project. It was proposed that

the rent received from the tenant would be utilised by accused no. 1 as

an advance from the complainant, against which post-dated cheques

for ₹35,00,000/- per year towards annual rent, along with an

additional ₹5,00,000/-, would be issued. The accused further

represented that the amount would be acknowledged by accused no. 1

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through promissory notes and acknowledgments of debt. Relying

upon the representations and considering his prior dealings with

accused nos. 2 to 5, the complainant agreed to the arrangement.

Accordingly, accused no.1 issued post-dated cheques of ₹35,00,000/-

along with promissory notes and acknowledgments of receipt and

utilisation of funds. Before the due dates, the accused sought

extensions on the ground that the project was under development, and

fresh cheques were issued upon return of the earlier ones. This

practice continued for subsequent years, with cheques of ₹35,00,000/-

being issued annually towards rent received, each secured by

acknowledgments and promissory notes. It was further alleged that

accused nos. 2, 3 and 5 agreed to compensate the complainant for

losses arising from failure to refund the security deposit of a tenant,

ABN Amro Bank, in respect of another jointly-owned premises on the

9th Floor of the same building. Due to such failure, the complainant‟s

portion could not be let out for a considerable period. Certain

payments were made intermittently; however, a cheque of

₹25,00,000/- dated 25.04.2006 issued by accused no. 1 towards

remaining compensation was dishonoured on presentation with the

remark “Funds Insufficient”. Upon this dishonour, when the

complainant threatened to present all cheques issued towards rental

dues, the accused again represented that accused no. 1 was on the

verge of commercial success and requested replacement of cheques.

Believing the assurances, the complainant accepted six post-dated

cheques bearing nos. 370448, 370449, 370450, 370451, 370452 and

370453, each for ₹35,00,000/-, drawn on Central Bank of India,

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Jeevan Tara Building, New Delhi, along with fresh acknowledgments

and promissory notes. In addition, the accused also replaced the

earlier dishonored cheque of ₹25,00,000/- with a new cheque bearing

no. 370455 drawn on Central bank of India, Jeevan Tara Building,

Parliament Street for ₹25,00,000/-, and also issued one more cheque

i.e. cheque bearing no. 370456 dated 14.8.2006, drawn on Central

Bank of India, for ₹16,00,000/- in favour of the complainant for the

loss of rent incurred in respect of another portion of 735 square feet

space/flat on the 9th floor of Gopal Das Bhawan, which amongst

others, was jointly owned by the accused and the same could not be

let out for about four years due to the accused‟s failure to refund the

security deposit to the last tenant. Thus, a total of 08 cheques were

issued by the accused. However, on presentation, the said cheques

were dishonoured due to “Insufficient Funds”. Despite issuance of

statutory legal notice and demand, the accused failed to make

payment, leading to filing of complaint cases under Section 138 of the

NI Act. Complaint Case Nos. 669/1/07, 670/1/07 and 671/1/07,

arising out of dishonour of cheque bearing nos. 370453, 370452 and

370448 respectively, are the subject matter of the present three

revision petitions i.e. CRL.REV.P. Nos. 724/2014, 725/2014 and

723/2014 respectively.

3. Accused nos. 1, 2 and 5 were summoned in the complaint cases

by the learned Trial Court. Notice under Section 251 of Cr.P.C. was

framed against the said accused on 11.03.2008, to which they pleaded

not guilty and claimed trial.

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4. In support of his case, the complainant examined himself as

CW-1 by way of affidavit, exhibited as Ex. CW-1/CD, reiterating the

averments made in the complaints. The complainant primarily relied

upon the following documents: (i) copy of the agreement to sell

executed between the complainant and accused no. 5 (Ex. CW-1/A);

(ii) copy of the receipt acknowledging receipt of sale consideration

(Ex. CW-1/B); (iii) copy of the flat buyer agreement (Ex. CW-1/C);

(iv) original dishonoured cheques (Ex. CW-1/F); (v) cheque return

memos evidencing dishonour of the cheques (Ex. CW-1/F-2 and Ex.

CW-1/G); (vi) acknowledgment receipt-cum-promissory note

executed by accused no. 1 through accused no. 2, Dhruv Varma (Ex.

CW-1/H); (vii) statutory legal notice issued to the accused (Ex. CW-

1/I); (viii) postal and courier receipts along with acknowledgments

evidencing dispatch and service of the legal notice (Ex. CW-1/J to Ex.

CW-1/BB); and (ix) reply to the legal notice sent on behalf of the

accused (Ex. CW-1/CC).

5. Thereafter, statements of accused nos. 1, 2 and 5 were recorded

under Section 313 Cr.P.C. on 30.04.2011, wherein all incriminating

evidence appearing against them was put to the accused. The accused

no. 2 (petitioner herein, appearing on behalf of accused no. 1 and 5

also) denied the allegations and claimed innocence.

6. In defence, the petitioner/accused no. 2 Dhruv Varma,

examined himself as the sole defence witness (DW-1). No other

witness was examined on behalf of the accused.

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7. Vide judgment dated 11.10.2012, learned Trial Court convicted

the accused persons for offence under Section 138 of NI Act. By way

of order on sentence dated 31.10.2012, the learned Trial Court

sentenced the accused persons in following manner: (i) accused no. 1

[M/s Vasu Tech Limited] was sentenced to deposit a fine of

Rs.5,000/- in the court, (ii) accused no. 2 [petitioner herein] was

sentenced to simple imprisonment for 1 year and further directed to

pay compensation to the tune of Rs. 50 lacs to the complainant within

one month, and in default thereof, to undergo a further simple

imprisonment for 3 months, and (iii) accused no. 5 [M/s RL Varma &

Sons (HUF)] was sentenced to pay a fine of Rs. 1 lacs, payable as

compensation to the complainant within one month, which is to be

paid by the accused no. 2 (petitioner herein) on behalf of accused no.

5.

8. In the three appeals preferred by the said accused persons, the

learned Appellate Court upheld the judgment of conviction, however

modified the order on sentence passed in three cases, and directed that

the accused no. 2 (petitioner no. 1 herein) shall pay a consolidated

sum of Rs. 1 crore to the complainant as compensation and in default

thereof, to undergo one year simple imprisonment, whereas accused

no. 1 and accused no. 5 each shall also pay Rs. 25 lakhs to the

complainant.

9. Aggrieved by the aforesaid decisions, the petitioners Dhruv

Varma and M/s Ratan Lal Varma & Sons (HUF) have preferred these

petitions.

CRL.REV.P. 723/2014 & connected matters Page 8 of 22

SUBMISSIONS BEFORE THE COURT

10. The petitioner, who argued the matter in person and also filed

detailed written submissions, contended that the scope of adjudication

in the present complaints was strictly confined to examining whether

the transaction as pleaded in the complaints was legally sustainable on

the basis of the evidence on record. It is submitted that no other

alleged or purported transaction, including any alleged cash loans,

could be imported into the adjudication, as the same did not form part

of the complaints. It is argued that the petitioner had consistently

denied the transaction as alleged by the complainant. According to the

petitioner, the complainant had, in fact, advanced certain cash loans to

accused no. 2, for which post-dated cheques and documents were

taken merely as collateral security. It was contended that upon

repayment of the cash loans, the complainant misused the security

cheques and documents to institute false complaint cases. It was urged

that this defence was taken at the earliest opportunity, including in the

reply to the legal notice, during cross-examination of the complainant,

and through defence evidence. The petitioner further submits that

there was no admission of any legally enforceable liability at any

stage of the proceedings. It is argued that the alleged cash loans, even

if assumed, were not part of the complaints, were denied by the

complainant, and could not constitute any admission of liability under

the complaints. According to the petitioner, both the learned Trial

Court and the learned Appellate Court erred in law by basing their

findings on an unrelated transaction not forming part of the

complaints.

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11. Assailing the concurrent findings, the petitioner contends that

the statutory presumptions under Sections 118 and 139 of the NI Act

stood duly rebutted. It is argued that the alleged sale of property and

the entire transaction set up by the complainant were false. The

agreements to sell and flat buyer agreements were mere security

documents, which were neither acted upon nor enforced. It is

contended that no sale of 4000 sq. ft. of space ever took place,

particularly when the karta of R.L. Varma & Sons (HUF) had not

signed the alleged sale documents, rendering the transaction invalid.

Further, there was no consideration for the sale, and the alleged

advance payment of ₹5,00,000/- was only a loan which stood repaid

through two cheques of ₹2,50,000/- each, a fact stated in the reply to

the legal notice and not denied by the complainant. It is further

contended that there was no transfer of security deposit in respect of

the tenanted premises, and that the complainant himself admitted

during cross-examination that he neither verified the quantum of rent

nor the security deposit with the tenant. It is argued that the

complainant failed to prove payment of any substantial cash amount

towards consideration, as he could neither disclose the source of funds

nor produce any supporting documents. Emphasis is also placed on

the conduct of the complainant to argue that no genuine sale

transaction ever took place. It is submitted that the complainant

neither sought registration or mutation of the alleged property nor

paid property tax in respect thereof. It is further contended that the

complainant never dealt with the tenant, never informed the tenant

about any alleged transfer of ownership, and never received rent

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directly, which falsifies the claim of ownership and rental income.

The petitioner further disputes the complainant‟s claim regarding

annual rent of ₹30,00,000/-, submitting that no evidence was

produced to establish such rent and that the complainant admitted to

not having verified the lease terms. It is also argued that the

complainant failed to specify the particular year for which the cheques

in question were allegedly issued.

12. It is additionally contended that there was no basis for inclusion

of an alleged interest component of ₹5,00,000/- in each cheque of

₹35,00,000/-, and that it was implausible for the interest amount to

remain constant over several years without any agreed rate or

supporting document. The petitioner further points out that the alleged

transaction was not reflected in the complainant‟s income tax returns,

either as rental income or as a loan advanced. It is also argued that the

alleged arrangement permitting the accused to receive rent as a loan

was unsupported by any document and was based solely on oral

assertions. The complainant‟s own admissions in cross-examination

are relied upon to contend that no written agreement or

correspondence existed in this regard. The enforceability of the

promissory notes is also questioned by the petitioner who appears in

person, as they did not reflect the alleged transaction and were

admittedly replaced from time to time. The petitioner further contends

that the Memorandum of Understanding relied upon by the

complainant did not amount to any admission of liability, particularly

since it was withdrawn and was not executed as part of court

proceedings. On these grounds, it is prayed that the impugned

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judgments be set aside and the petitioner be acquitted in the present

case.

13. Conversely, the learned counsel appearing for the respondent–

complainant argues that the scope of interference in revisional

jurisdiction is extremely limited. It is submitted that while appellate

jurisdiction is co-extensive with that of the Trial Court in so far as

appreciation and re-appreciation of evidence is concerned, a

revisional court is required to confine itself to examining the legality,

propriety and correctness of the findings, as also whether the

subordinate courts have acted within the bounds of their jurisdiction.

It is argued that in the present case, no illegality, perversity or

jurisdictional error has been pointed out in the concurrent judgments

of the learned Trial Court and the learned Appellate Court. According

to the respondent, the petitioner, having failed before two courts

below, is merely seeking a re-appreciation of evidence in the garb of a

revision petition, which is impermissible in law. The learned counsel

submits that the issuance of the cheques in question is admitted, the

liability in respect thereof stands admitted, and receipt of the statutory

legal notice under Section 138 of the NI Act is also not disputed. It is

contended that in the absence of any denial of these foundational

facts, no ground is made out for interference by this Court in exercise

of its revisional powers. It is argued that Sections 118, 138 and 139 of

the NI Act raise a statutory presumption that the cheques were issued

towards discharge of a legally enforceable debt or liability. The

burden to rebut the said presumption lies squarely on the accused,

which, according to learned counsel, the petitioner has failed to

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discharge. It is submitted that the defence of the cheques being issued

as “security cheques” has remained a bald assertion, unsupported by

any credible evidence.

14. The learned counsel further contends that the petitioner has, in

fact, admitted the transaction and the liability. It is argued that the

reply to the statutory legal notice, exhibited as Ex. CW-1/CC,

contains an admission of issuance of cheques and subsisting liability,

which has been deliberately concealed by the petitioner. It is

submitted that the petitioner himself admitted that the liability as on

the date of dishonour aggregated to about ₹2.5 crores, corresponding

to the value of the cheques issued. It is also argued that the petitioner

has suppressed material facts relating to subsequent conduct. The

learned counsel submits that after conviction in another cheque

dishonour case, the petitioner approached the complainant for

settlement and agreed to pay a sum of ₹4.10 crores against a total

liability of ₹2.51 crores for the period 2002–2007. The petitioner

admitted execution of the Memorandum of Understanding dated

20.08.2009, exhibited as Ex. DW-1/C-5, during sentencing

proceedings, and obtained leniency on the basis of such admission.

15. It is further contended that even after dismissal of his appeal by

the learned ASJ, Patiala House Courts, in respect of another cheque of

₹35,00,000/-, the petitioner again undertook before the appellate court

to abide by the terms of the MOU, as reflected in Ex. DW-1/C-6, and

thereby avoided imprisonment. It is argued that despite taking

advantage of such undertakings and admissions, the petitioner later

CRL.REV.P. 723/2014 & connected matters Page 13 of 22

resiled from the settlement and continued to contest the proceedings.

It is contended that the petitioner has taken inconsistent stands across

proceedings. It is argued that while denying the sale transaction and

liability in the present revision petitions, the petitioner admitted the

sale and financial arrangement in contempt proceedings before this

Court, and reliance is placed on an affidavit filed by the petitioner in

W.P.(C) No. 7653 of 2011, wherein the petitioner acknowledged

execution of the agreement dated 19.10.2001 in respect of 4000 sq. ft.

at Gopal Das Bhawan, receipt of substantial consideration, and

utilisation of the transaction for raising finances for his business. It is

argued that such admissions demolish the defence now sought to be

raised by the petitioner. In view of the aforesaid submissions, the

learned counsel for the respondent–complainant contends that the

revision petitions are devoid of merit, and are liable to be dismissed.

16. This Court has heard arguments addressed by the petitioner as

well as the learned counsel for the respondent, and has perused the

material on record.

ANALYSIS & FINDINGS

17. The case set out by the complainant, in a nutshell, is that the

cheques in question were issued by the accused towards discharge of

a legally enforceable liability arising out of the arrangement between

the parties relating to the sale of property and assignment of rent, and

that upon presentation, the said cheques were dishonoured, thereby

attracting the offence under Section 138 of the NI Act.

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18. Before proceeding further, it would be apposite to briefly

advert to the essential ingredients for constituting an offence under

Section 138 of the NI Act. In Dashrathbhai Trikambhai Patel v.

Hitesh Mahendrabhai Patel: (2023) 1 SCC 578 case the Supreme

Court had observed as under:

“11. Section 138 of the Act provides that a drawer of a cheque

is deemed to have committed the offence if the following

ingredients are fulfilled:

(i) A cheque drawn for the payment of any amount of money

to another person;

(ii) The cheque is drawn for the discharge of the „whole or

part‟ of any debt or other liability. „Debt or other liability‟

means legally enforceable debt or other liability; and

(iii) The cheque is returned by the bank unpaid because of

insufficient funds.

However, unless the stipulations in the proviso are fulfilled the

offence is not deemed to be committed. The conditions in the

proviso are as follows:

(i) The cheque must be presented in the bank within six months

from the date on which it was drawn or within the period of its

validity;

(ii) The holder of the cheque must make a demand for the

payment of the „said amount of money‟ by giving a notice in

writing to the drawer of the cheque within thirty days from the

receipt of the notice from the bank that the cheque was

returned dishonoured; and

(iii) The holder of the cheque fails to make the payment of the

said amount of money within fifteen days from the receipt of

the notice…”

19. In the present case, at the outset, it is apposite to note that the

learned Trial Court, in its judgment, has recorded that the proceedings

against accused no. 1, i.e. M/s Vasu Tech Limited, and accused no. 5,

i.e. M/s RL Varma & Sons (HUF), were conducted through accused

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no. 2, i.e. the petitioner no. 1 herein. It was further noted that the

petitioner admitted in his cross-examination that he had been the

Managing Director of accused no. 1 as well as the authorised

signatory of accused no. 5 for more than fifteen years. In view

thereof, the learned Trial Court concluded that the petitioner was

managing the affairs of accused nos.1 and 5 and was responsible for

their acts and conduct. No material has been shown before this Court

to dislodge the said factual finding.

20. In the case at hand, several foundational facts remain

undisputed. Most importantly, the petitioner has not disputed his

signatures on the cheques in question, nor has he denied the issuance

of the said cheques in favour of the complainant. Once the execution

of the cheques is admitted, the statutory presumption under Section

139 of the NI Act necessarily comes into play. Consequently, it is to

be presumed that the cheques were issued towards discharge of a

legally enforceable debt or liability, and the burden shifts upon the

petitioner to rebut the said presumption by leading cogent and

convincing evidence.

21. The core defence of the petitioner is that the cheques in

question were not issued towards payment of rent and additional

interest, as alleged by the complainant, but were merely security

cheques handed over to secure repayment of alleged cash loans

advanced by the complainant to the petitioner.

22. In this context, this Court first takes note of the cross-

examination of the complainant (CW-1). A perusal of the record

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reveals that specific suggestions were put to the complainant to the

effect that he had been advancing cash loans to the petitioner since

1998 and that in the year 2001, cash loans amounting to

approximately ₹2.03 crores were advanced to him. The complainant

clearly denied these suggestions. He further denied that the alleged

agreements and guarantees were executed merely as collateral

security for such cash loans, or that he had been receiving repayments

towards principal and interest after the year 2001. He also denied the

suggestion that post-dated cheques were obtained only as further

security. In fact, all suggestions put to the complainant seeking to

project the cheques and documents as security instruments were

consistently denied by him.

23. On the other hand, when the evidence of the petitioner-accused,

examined as DW-1, is analysed, it emerges – as correctly noted by the

learned Trial Court – that the petitioner admitted that the rate of

interest allegedly applicable to the claimed cash loans, as referred to

in his reply to the legal notice, was never finalised. He also admitted

that no such alleged cash loans, running into about ₹2 crores, were

reflected in his books of accounts. These admissions substantially

dent the plausibility of the defence sought to be raised and lend

support to the conclusion drawn by the learned Trial Court that the

petitioner failed to probabilise his version.

24. Furthermore, the case of the complainant with regard to

execution of documents is clearly supported by the material on record,

including the admissions made by the petitioner in his defence

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evidence. Notably, the petitioner, in his cross-examination, has not

disputed his signatures on documents Ex. CW-1/A, Ex. CW-1/B and

Ex. CW-1/C, which are the agreement to sell, the receipt

acknowledging consideration, and the flat buyer agreement,

respectively. He has further admitted that he signed the said

documents as the authorised signatory of accused no. 5. The petitioner

herein has also admitted that in document Ex. CW-1/A, at page 4, it is

specifically recorded that the rent due from the flat/space from

19.06.2002 shall stand assigned to the buyer (complainant herein),

and that the said handwritten portion is in his own handwriting. He

has further admitted that the cheque mentioned in the first clause on

page 4 of Ex. CW-1/A was received and encashed by accused no. 5.

Additionally, the petitioner has admitted that the promissory note Ex.

CW-1/H was handed over along with the cheque in question to the

complainant and that the said promissory note bears his signatures.

25. Thus, this is a case where the petitioner has not disputed the

genuineness of any of the documents or his signatures thereon, relied

upon by the complainant. An overall conspectus of the documentary

evidence clearly demonstrates that agreements were entered into

between the parties, a clear understanding was also arrived at between

the parties regarding the property and rental income, and cheques

were issued by the petitioner in favour of the complainant. Despite

these admitted facts, the petitioner seeks to dispute the very intent of

the documents by contending that, although signed by him, they were

never meant to be acted upon.

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26. Such an argument cannot help the case of the petitioner. It is

unlikely for a reasonable person that merely for securing alleged cash

loans, the petitioner would execute multiple documents relating to

sale and purchase of immovable property, assignment of rental

income, and issue promissory notes, all of which were acted upon in

part. As rightly observed by the learned Trial Court, if the documents

were never intended to be acted upon, there is no explanation

forthcoming as to why the cheque mentioned in the first clause at

page 4 of Ex. CW-1/A was encashed by accused no. 5. The petitioner

has also failed to examine any independent witness or produce any

material to substantiate his plea that the documents were executed

only as collateral security and were not intended to be given legal

effect. It may also be noted that while the complainant had

specifically pleaded that the subject flat/space was under tenancy of

M/s Indo Rama Synthetics (I) Ltd. at the time of execution of the

agreement to sell, the petitioner, in his cross-examination as DW-1,

expressly admitted that 4000 sq. ft. super area at Gopal Das Bhawan

was under the tenancy of the said tenant in the year 2001, which lends

further credence to the version set up by the complainant.

27. Moreover, even in the defence evidence, during cross-

examination, the petitioner admitted that at the time when the cheques

were presented for encashment in February 2007, an amount of about

₹2 to ₹2.5 crores was payable to the complainant. It is noteworthy that

a total of eight cheques were presented by the complainant,

aggregating to ₹2.51 crores. This admission of the petitioner therefore

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also fortifies the conclusion that the cheques were issued in favour of

the complainant towards discharge of a subsisting liability.

28. Another important aspect of the case pertains to the

Memorandum of Understanding dated 20.08.2009, the execution of

which is admitted by the petitioner in his cross-examination in the

present cases. In this regard, it is relevant to note that out of the eight

cheques forming part of the overall transaction, the petitioner had

already been convicted in respect of one cheque of ₹35,00,000/- vide

judgment dated 06.08.2009 passed in Complaint Case No.

3122/01/09. At the stage of sentencing in the said case, the petitioner

entered into a Memorandum of Understanding running into sixteen

pages, whereby he had agreed to pay a sum of ₹4.10 crores in full and

final settlement of all cheques issued by him in favour of the

complainant, aggregating to ₹2.51 crores. The factum of execution of

the said MOU is not disputed by the petitioner. Once the petitioner

himself entered into an MOU acknowledging issuance of the cheques

in question and his liability to repay the amounts covered thereby, he

cannot now be permitted to resile from such admission and contend

that the MOU is not to be relied upon in the present proceedings. It is

further material to note that pursuant to the said MOU, the petitioner

paid a sum of ₹75,00,000/- to the complainant by way of demand

draft on the same day, leading to withdrawal of the complaint case

relating to cheque bearing no. 370449. The petitioner also paid an

amount of ₹35,00,000/- to the complainant for withdrawal of the

complaint case pertaining to cheque bearing no. 370456. These

payments clearly demonstrate that the petitioner was acknowledging

CRL.REV.P. 723/2014 & connected matters Page 20 of 22

his subsisting liability and was acting upon the terms of the MOU by

making substantial payments towards settlement of the cheques in

question.

29. In light of the aforesaid material, facts and circumstances, this

Court is of the considered view that the arguments raised by the

petitioner are wholly devoid of merit and are liable to be rejected. The

contentions regarding the complainant not having sought mutation of

the property in his name, not having independently verified the details

of the tenant, or not having ascertained the exact quantum of rent or

not contacted the tenant, do not advance the petitioner‟s case in any

manner. This is so particularly in view of the fact that the petitioner,

in his own defence evidence and during cross-examination, has

admitted execution of all documents placed on record by the

complainant, including his signatures thereon. He has also admitted

the existence of a liability payable to the complainant, though he

seeks to assert that the same stood repaid, for which no cogent or

convincing proof has been produced. Further, the petitioner‟s conduct

in proceedings before other courts, where similar complaint cases

under Section 138 of the NI Act arising out of dishonour of cheques

were pending, or where he stood convicted, including execution of the

Memorandum of Understanding dated 20.08.2009, wherein he again

admitted issuance of eight cheques, including the three cheques

forming subject matter of the present cases, and agreed to repay the

entire outstanding amount, coupled with the statements made by him

before the courts in that regard, clearly outweigh the contentions now

sought to be raised before this Court.

CRL.REV.P. 723/2014 & connected matters Page 21 of 22

30. In the totality of the circumstances, the petitioner has failed to

rebut the statutory presumption under Section 139 of the NI Act, and

the complainant has successfully proved all the essential ingredients

of the offence under Section 138 of the NI Act.

31. Consequently, no perversity, illegality or infirmity can be found

in the concurrent findings recorded by the learned Trial Court and the

learned Appellate Court so as to warrant interference in exercise of

revisional jurisdiction.

32. Insofar as the order on sentence is concerned, this Court is of

the considered view that the learned Trial Court had taken a correct

and balanced approach by imposing a fine of ₹50,00,000/- in each

case (against the cheque amount of ₹35,00,000/- in each case) to be

paid by accused no.2 / petitioner no.1 herein, and a fine of ₹1,00,000/-

to be paid by accused no.5 / petitioner no.2 herein, as compensation to

the respondent–complainant. The impugned appellate judgment does

not disclose any cogent reasons for modifying the said sentence and

imposing a consolidated fine of ₹1,00,00,000/- in each case, payable

by accused no.2, and ₹25,00,000/- each payable by accused nos.1 and

5. Accordingly, the impugned judgment is set aside to the extent it

relates to the order on sentence, and the order on sentence dated

31.10.2012 passed by the learned Trial Court is restored.

33. The present petitions are accordingly dismissed, albeit, in

above terms.

34. Copy of this judgment be sent to the learned Trial Court for

necessary information and action.

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35. The judgment be uploaded on the website forthwith.

DR. SWARANA KANTA SHARMA, J

FEBRUARY 27, 2026/

T.D./T.S.