2026:HHC:20034 IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA Cr.MMO Nos.1303 & 1302 of 2022 Date of Decision: 26.05.2026 __________________________________________________________________________ 1. Cr.MMO No.1303 of 2022 Monika ……...Petitioner Versus State of Himachal Pradesh and Another …....Respondents 2. Cr.MMO No.1302 of 2022 Monika ……...Petitioner Versus State of Himachal Pradesh and Another …....Respondents Coram: Hon’ble Mr. Justice Sandeep Sharma, Judge. Whether approved for reporting?1 Yes. __________________________________________________________________________ For the Petitioner: Mr. Servedaman Rathore, Advocate, in both the petitions. For the Respondents: Mr. Rajan Kahol, Additional Advocate General, with Mr. Anish Banshtu, Deputy Advocate General, for State. Ms. Suhani Gautam, Advocate, vice Mr. Amit Vaid, Advocate, for respondent No.2, in both the petitions. __________________________________________________________________________ Sandeep Sharma, J. (oral) Since common question of fact and law are involved in both the above captioned cases and parties to the lis are also same, coupled with the fact that petitioner in both the cases have filed petitions under Section 482 of Criminal Procedure Code (now Section 528 of Bharatiya Nagrik Suraksha 1Whether the reporters of the local papers may be allowed to see the judgment? 2026:HHC:20034 -2- Sanhita, 2023) praying therein for quashing of complaints filed under Section 138 of the Negotiable Instruments Act, this Court, after having clubbed the same, heard them together and are now being disposed of vide common judgment. 2. Precisely, the facts of the case, as emerge from the record as well as pleadings adduced on record by the respective parties are that respondent No.2-M/s Green Leaf (hereinafter, ‘complainant’) in both the cases leased out Hotel Green Leaf to the accused for a period of five years for a total sum of ₹96,00,000/-. Petitioner-accused (hereinafter, ‘accused’), in both the cases, issued number of post-dated Cheques in favour of complainant with a view to discharge lawful liability or to pay the leased amount, however, Cheque bearing No.229299 dated 07.10.2021, amounting to 5,14,285/- and Cheque bearing No.229300 dated ₹ 07.10.2021, amounting to 5,14,285/-, drawn at Canara Bank, Ghaziabad ₹ Raj Nagar Ext. Branch, in favour of complainant, were dishonoured by the Bank concerned with remarks ‘Present with document’. Though immediately after receipt of aforesaid return memo, complainant served accused with legal notice calling upon him to make the payment good within stipulated time, but since needful was not done, complainant instituted two different complaints in the competent Court of law under Section 138 of the Act. Learned trial Court taking cognizance of the matter, issued summons to the accused and after service of accused in both the 2026:HHC:20034 -3- cases, notice of accusation was framed. However, before commencement of evidence of complainant, accused approached this Court in the instant proceedings filed under Section 482 of Cr.P.C. for quashing of complaints on the ground that complaints are not maintainable for the reason that Cheques in question were not returned by the Bank concerned for want of ‘insufficient funds’, rather same were dishonoured with the remarks ‘Present with document’. 3. Mr. Servedaman Rathore, learned counsel representing the petitioner, while making this Court peruse Section 138 of the Act, vehemently argued that proceedings, if any, under Section 138 of the Act can be said to be maintainable only qua those Cheques which were dishonoured on account of ‘insufficient funds’ in the Bank account of the accused. Mr. Rathore further submitted that since in the instant case, Cheques were returned with the remarks ‘Present with Document’, complainant instead of instituting proceedings under Section 138 of the Act ought to have presented the Cheques again with requisite documents. He submitted that there is nothing to suggest that at the time of presentation of Cheques in question there was no amount in the Bank account of the accused and, therefore, no proceedings under Section 138 of the Act are maintainable and as such, this Court while exercising power under Section 482 of Cr.P.C. (now Section 528 of BNSS) may proceed to quash the complaints. Mr. Rathore submitted that since on account of aforesaid 2026:HHC:20034 -4- factum, complaints having been filed by the complainant are likely to fail, no fruitful purpose would be served by putting the accused to the ordeal of protracted trial, which is otherwise bound to fail. In support of his aforesaid submission, Mr. Rathore placed heavy reliance upon judgment passed by the Hon’ble Apex Court in Vinod Tanna and Another Vs. Zaher Siddiqui and Others, (2002) 7 SCC 541. 4. To the contrary, Ms. Suhani Gautam, learned counsel representing complainant, while opposing the aforesaid prayer made at the behest of accused, vehemently argued that present petitions are not maintainable, rather the same, being an abuse of the process of law deserves, to be rejected with exemplary costs. Ms. Suhani Gautam, learned counsel representing complainant, further argued that expression used ‘insufficiency of funds’ under Section 138 of the Act cannot be construed narrowly, rather requires to be given wider meaning. She submitted that since in the case at hand, Cheques issued by accused towards discharge of lawful liability were returned with the remarks ‘Present with document’ and while doing so, Bank concerned had not pointed out documents, other than Cheques, if any, required to be produced by complainant, complainant had no option but to institute proceedings under Section 138 of the Act. Learned counsel representing complainant further argued that before initiating proceedings under Section 138 of the Act, complainant had served accused with legal notice, but accused never chose to reply the same. She 2026:HHC:20034 -5- further submitted that even at the time of taking cognizance and framing notice of accusation, plea with regard to maintainability of complaints on the grounds, as detailed hereinabove, never came to be raised at the behest of the accused. While distinguishing judgment passed by the Hon’ble Apex Court in Vinod Tanna (supra), learned counsel representing complainant invited attention of this Court to the judgment passed by the Hon’ble Apex Court in Laxmi Dyechem Vs. State of Gujarat an Others, (2012) 13 SCC 375, to state that expression ‘insufficient funds’ used under Section 138 of the Act is a genus and dishonour for reasons such as “account closed”, “payment stopped”, “referred to the drawer” are only species of that genus. She submitted that remarks ‘Present with document’ also amounts to insufficiency of funds, because by no stretch of imagination, person in whose favour Cheque is issued can present documents, if required, along with Cheque issued in his/her favour, rather such documents, if any, can only be produced by the accused, who issued the Cheque. She submitted that petitioner has not approached this Court with clean hands, rather has made an attempt to misuse the provisions contained under Section 482 of Cr.P.C. Lastly, Ms. Suhani Gautam, learned counsel representing the complainant, submitted that accused has purposely filed instant petitions after the expiry of three years from the date of issuance of Cheque, because by that time, complainant had also lost the limitation period for filing a civil suit, if any, required. 2026:HHC:20034 -6- 5. I have heard learned counsel for the parties and perused material available on record. 6. Before ascertaining the genuineness and correctness of the submissions and counter submissions having been made by the learned counsel for the parties vis-à-vis prayer made in the instant petitions, this Court deems it necessary to discuss/elaborate the scope and competence of this Court to quash the criminal proceedings while exercising power under Section 482 of Cr.P.C. 7. A three-Judge Bench of the Hon’ble Apex Court in case titled State of Karnataka v. L. Muniswamy and others, 1977 (2) SCC 699, held that High Court, while exercising power under Section 482 Cr.PC is entitled to quash the proceedings, if it comes to the conclusion that allowing the proceeding to continue would be an abuse of the process of the Court or that the ends of justice require that the proceeding ought to be quashed. 8. Subsequently, in case titled State of Haryana and others v. Bhajan Lal and others, 1992 Supp (1) SCC 335, the Hon’ble Apex Court, while elaborately discussing the scope and competence of High Court to quash criminal proceedings under Section 482 Cr.PC laid down certain principles governing the jurisdiction of High Court to exercise its power. After passing of aforesaid judgment, issue with regard to exercise of power under Section 482 Cr.PC, again came to be considered by the Hon’ble Apex Court in Criminal Appeal No.577 of 2017 (arising out of SLP (CrL.) No. 287 2026:HHC:20034 -7- of 2017) titled Vineet Kumar and Ors. v. State of U.P. and Anr., wherein it has been held that saving of the High Court’s inherent powers, both in civil and criminal matters, is designed to achieve a salutary public purpose i.e. court proceedings ought not be permitted to degenerate into a weapon of harassment or persecution. 9. In Amish Devgan vs Union of India and Ors, (2021) 1 SCC 1, the Hon’ble Apex Court held as under: “(vii) Conclusion and relief 116. At this stage and before recording our final conclusion, we would like to refer to decision of this Court in Pirthi Chand [State of H.P. v. Pirthi Chand, (1996) 2 SCC 37 : 1996 SCC (Cri) 210] wherein it has been held : (SCC pp. 44-45, paras 12- 13) “12. It is thus settled law that the exercise of inherent power of the High Court is an exceptional one. Great care should be taken by the High Court before embarking to scrutinise the FIR/charge-sheet/complaint. In deciding whether the case is rarest of rare cases to scuttle the prosecution in its inception, it first has to get into the grip of the matter whether the allegations constitute the offence. It must be remembered that FIR is only an initiation to move the machinery and to investigate into cognizable offence. After the investigation is conducted (sic concluded) and the charge-sheet is laid, the prosecution produces the statements of the witnesses recorded under Section 161 of the Code in support of the charge-sheet. At that stage it is not the function of the court to weigh the pros and cons of the prosecution case or to consider necessity of strict compliance with the provisions which are considered mandatory and effect of its non-compliance. It would be done after the trial is concluded. The court has to prima facie consider from the averments in the charge-sheet and the statements of witnesses on the record in support thereof whether court could take cognizance of the offence on that evidence and proceed further with the trial. If it reaches a conclusion that no cognizable offence is made out, no further act could be done except to quash the charge-sheet. But only in exceptional 2026:HHC:20034 -8- cases i.e. in rarest of rare cases of mala fide initiation of the proceedings to wreak private vengeance issue of process under Criminal Procedure Code is availed of. A reading of a [Vide Corrigendum dated 20-3-1996 issued from Residential Office of Hon'ble Mr Justice K. Ramaswamy.] complaint or FIR itself does not disclose at all any cognizable offence — the court may embark upon the consideration thereof and exercise the power.” 10. In the case of Kaptan Singh vs State of Uttar Pradesh and Ors., (2021) 9 SCC 35, the Supreme Court held as under : “9.1. At the outset, it is required to be noted that in the present case the High Court in exercise of powers under Section 482 CrPC has quashed the criminal proceedings for the offences under Sections 147, 148, 149, 406, 329 and 386 IPC. It is required to be noted that when the High Court in exercise of powers under Section 482 CrPC quashed the criminal proceedings, by the time the investigating officer after recording the statement of the witnesses, statement of the complainant and collecting the evidence from the incident place and after taking statement of the independent witnesses and even statement of the accused persons, has filed the charge-sheet before the learned Magistrate for the offences under Sections 147, 148, 149, 406, 329 and 386 IPC and even the learned Magistrate also took the cognizance. From the impugned judgment and order [Radhey Shyam Gupta v. State of U.P., 2020 SCC OnLine All 914] passed by the High Court, it does not appear that the High Court took into consideration the material collected during the investigation/inquiry and even the statements recorded. If the petition under Section 482 CrPC was at the stage of FIR in that case the allegations in the FIR/complaint only are required to be considered and whether a cognizable offence is disclosed or not is required to be considered. However, thereafter when the statements are recorded, evidence is collected and the charge-sheet is filed after conclusion of the investigation/inquiry the matter stands on different footing and the Court is required to consider the material/evidence collected during the investigation. Even at this stage also, as observed and held by this Court in a catena of decisions, the High Court is not required to go into 2026:HHC:20034 -9- the merits of the allegations and/or enter into the merits of the case as if the High Court is exercising the appellate jurisdiction and/or conducting the trial. As held by this Court in Dineshbhai Chandubhai Patel [Dineshbhai Chandubhai Patel v. State of Gujarat, (2018) 3 SCC 104 : (2018) 1 SCC (Cri) 683] in order to examine as to whether factual contents of FIR disclose any cognizable offence or not, the High Court cannot act like the investigating agency nor can exercise the powers like an appellate court. It is further observed and held that that question is required to be examined keeping in view, the contents of FIR and prima facie material, if any, requiring no proof. At such stage, the High Court cannot appreciate evidence nor can it draw its own inferences from contents of FIR and material relied on. It is further observed it is more so, when the material relied on is disputed. It is further observed that in such a situation, it becomes the job of the investigating authority at such stage to probe and then of the court to examine questions once the charge-sheet is filed along with such material as to how far and to what extent reliance can be placed on such material. 12. Therefore, the High Court has grossly erred in quashing the criminal proceedings by entering into the merits of the allegations as if the High Court was exercising the appellate jurisdiction and/or conducting the trial. The High Court has exceeded its jurisdiction in quashing the criminal proceedings in exercise of powers under Section 482 CrPC.” 11. Recently, Hon’ble Apex Court in Abhishek Singh vs Ajay Kumar and Ors., (2025) SCC OnLine SC 1313, reiterated that: “9. The scope of the Court's power to quash and set aside proceedings is well-settled to warrant any restatement. While the arguments advanced have the potential to raise many issues for consideration, we must first satisfy ourselves as to the propriety of the exercise of such power by the High Court. The task of the High Court, when called upon to adjudicate an application seeking to quash the proceedings, is to see whether, prima facie, an offence is made out or not. It is not to examine whether the charges may hold up in the Court. In doing so, the area of action is circumscribed. In Rajeev Kourav v. Baisahab, it was held: 2026:HHC:20034 -10- “8. It is no more res integra that exercise of power under Section 482 CrPC to quash a criminal proceeding is only when an allegation made in the FIR or the charge-sheet constitutes the ingredients of the offence/offences alleged. Interference by the High Court under Section 482 CrPC is to prevent the abuse of process of any court or otherwise to secure the ends of justice. It is settled law that the evidence produced by the accused in his defence cannot be looked into by the court, except in very exceptional circumstances, at the initial stage of the criminal proceedings. It is trite law that the High Court cannot embark upon the appreciation of evidence while considering the petition filed under Section 482 CrPC for quashing criminal proceedings. It is clear from the law laid down by this Court that if a prima facie case is made out disclosing the ingredients of the offence alleged against the accused, the Court cannot quash a criminal proceeding.” 15. In that view of the matter, we hold that the High Court had improperly quashed the proceedings initiated by the appellant. It stands clarified that we have not expressed any opinion on the matter, and the guilt or innocence of the respondents has to be established in the trial, in accordance with the law. The proceedings out of the subject FIR, mentioned in paragraph 2 are revived and restored to the file of the concerned Court.” 12. Reliance is also placed upon judgments passed by the Hon’ble Apex Court in Prashant Bharti Vs. State (NCT of Delhi), (2013) 9 SCC 293, Rajiv Thapar and Others Vs. Madan Lal Kapoor, (2013) 3 SCC 330, Anand Kumar Mohatta and Anr. v. State (Government of NCT of Delhi) Department of Home and Anr, AIR 2019 SC 210 and Pramod Suryabhan Pawar v. The State of Maharashtra and Anr, (2019) 9 SCC 608. 2026:HHC:20034 -11- 13. Now being guided by the aforesaid proposition of law laid down by the Hon’ble Apex Court, this Court would make an endeavour to examine and consider the prayer made in the instant petition vis-à-vis factual matrix of the case. 14. Having heard learned counsel representing the parties and perused material available on record, this Court finds that there is no denial, if any, on the part of the accused with regard to issuance of Cheques as well as signatures thereupon of authorised person, rather attempt has been made to get the complaints filed at the behest of complainant quashed on the ground that Cheques issued by accused in favour of complainant were never dishonoured on account of ‘insufficient funds’, rather same were returned with remarks ‘Present with document’. It came to be argued at the behest of accused that immediately after the receipt of return memo, complainant ought to have contacted Bank concerned to know what kind of documents are required to be produced for clearance of Cheques. 15. Mr. Rathore, learned counsel representing the petitioner, specifically referred to Section 138 of the Act to strengthen his argument that only in situation of ‘insufficiency of funds’ in the Bank account of the accused, complaint under Section 138 of the Act is maintainable. To ascertain correctness of aforesaid claim of Mr. Rathore, it is apt to take note of Section 138 of the Act, which reads as under: “138. 15. Mr. Rathore, learned counsel representing the petitioner, specifically referred to Section 138 of the Act to strengthen his argument that only in situation of ‘insufficiency of funds’ in the Bank account of the accused, complaint under Section 138 of the Act is maintainable. To ascertain correctness of aforesaid claim of Mr. Rathore, it is apt to take note of Section 138 of the Act, which reads as under: “138. Dishonour of cheque for insufficiency, etc., of funds in the account.— 2026:HHC:20034 -12- Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both: Provided that nothing contained in this section shall apply unless— (a)the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier; (b)the payee or the holder in due course of the cheque, as the case may be, makes 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 of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and (c)the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice. Explanation.— For the purposes of this section, “debt or other liability” means a legally enforceable debt or other liability.] 16. Careful perusal of aforesaid provision of law reveals that where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person towards discharge of liability, is returned by the Bank unpaid, because of insufficiency of funds in the Bank account or that it exceeds the amount 2026:HHC:20034 -13- otherwise agreed to be paid from that account by an agreement shall be deemed to have committed an offence and shall, without prejudice to any other provisions of the Act, be punished with imprisonment, as prescribed under Section 138 of the Act. As per aforesaid provision of law, a cheque dishonoured on account of ‘insufficiency of funds’ or where it exceeds the amount arranged to be paid would attract the provisions under Section 138 of the Act. 17. Question, which needs to be determined in the case at hand is whether reasons, if any, other than the reasons, as detailed in Section 138 of the Act, assigned by the Bank concerned while returning the Cheque can be a ground to file complaint under Section 138 of the Act, has been aptly and elaborately answered by Hon’ble Apex Court in Laxmi Dyechem (supra). In afore case, Hon’ble Apex Court held that first contingency expression i.e. “either because of the amount of money standing to the credit of that account is insufficient to honour the cheque” used under Section 138 of the Act is a genus and dishonour for reasons such as “account closed”, “payment stopped”, “referred to the drawer”, “signature do not match” or “image not found” are only species of that genus. In afore judgment, Hon’ble Apex Court categorically held that two contingencies envisaged under Section 138 of the Act cannot be interpreted strictly or literally. Relevant Paras of afore judgment read as under: 2026:HHC:20034 -14- “15. The above line of decisions leaves no room for holding that the two contingencies envisaged under Section 138 of the Act must be interpreted strictly or literally. We find ourselves in respectful agreement with the decision in NEPC Micon Ltd. (supra) that the expression “amount of money …………. is insufficient” appearing in Section 138 of the Act is a genus and dishonour for reasons such “as account closed”, “payment stopped”, “referred to the drawer” are only species of that genus. Just as dishonour of a cheque on the ground that the account has been closed is a dishonour falling in the first contingency referred to in Section 138, so also dishonour on the ground that the “signatures do not match” or that the “image is not found”, which too implies that the specimen signatures do not match the signatures on the cheque would constitute a dishonour within the meaning of Section 138 of the Act. This Court has in the decisions referred to above taken note of situations and contingencies arising out of deliberate acts of omission or commission on the part of the drawers of the cheques which would inevitably result in the dishonour of the cheque issued by them. For instance this Court has held that if after issue of the cheque the drawer closes the account it must be presumed that the amount in the account was nil hence insufficient to meet the demand of the cheque. A similar result can be brought about by the drawer changing his specimen signature given to the bank or in the case of a company by the company changing the mandate of those authorised to sign the cheques on its behalf. Such changes or alteration in the mandate may be dishonest or fraudulent and that would inevitably result in dishonour of all cheques signed by the previously authorised signatories. There is in our view no qualitative difference between a situation where the dishonour takes place on account of the substitution by a new set of authorised signatories resulting in the dishonour of the cheques already issued and another situation in which the drawer of the cheque changes his own signatures or closes the account or issues instructions to the bank not to make the payment. So long as the change is brought about with a view to preventing the cheque being honoured the dishonour would become an offence under Section 138 subject to other conditions prescribed being satisfied. There may indeed be situations where a mismatch between the signatories on the cheque drawn by the drawer and the specimen available with the bank may result in 2026:HHC:20034 -15- dishonour of the cheque even when the drawer never intended to invite such a dishonour. We are also conscious of the fact that an authorised signatory may in the ordinary course of business be replaced by a new signatory ending the earlier mandate to the bank. Dishonour on account of such changes that may occur in the course of ordinary business of a company, partnership or an individual may not constitute an offence by itself because such a dishonour in order to qualify for prosecution under Section 138 shall have to be preceded by a statutory notice where the drawer is called upon and has the opportunity to arrange the payment of the amount covered by the cheque. It is only when the drawer despite receipt of such a notice and despite the opportunity to make the payment within the time stipulated under the statute does not pay the amount that the dishonour would be considered a dishonour constituting an offence, hence punishable. Even in such cases, the question whether or not there was a lawfully recoverable debt or liability for discharge whereof the cheque was issued would be a matter that the trial Court will examine having regard to the evidence adduced before it and keeping in view the statutory presumption that unless rebutted the cheque is presumed to have been issued for a valid consideration. 16. In the case at hand, the High Court relied upon a decision of this Court in Vinod Tanna’s case (supra) in support of its view. We have carefully gone through the said decision which relies upon the decision of this Court in Electronics Trade & Technology Development Corporation Ltd. (supra). The view expressed by this Court in Electronics Trade & Technology Development Corporation Ltd. (supra) that a dishonour of the cheque by the drawer after issue of a notice to the holder asking him not to present a cheque would not attract Section 138 has been specifically overruled in Modi Cements Ltd. case (supra). The net effect is that dishonour on the ground that the payment has been stopped, regardless whether such stoppage is with or without notice to the drawer, and regardless whether the stoppage of payment is on the ground that the amount lying in the account was not sufficient to meet the requirement of the cheque, would attract the provisions of Section 138.” 2026:HHC:20034 -16- 18. It is quite apparent from the aforesaid provision of law laid down by Hon’ble Apex Court that expression “amount of money amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient” appearing in Section 138 of the Act cannot be given narrower meaning, rather requires to be given wider meaning. Though Court in afore judgment, while interpreting aforesaid expression “amount of money amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient” referred to certain other contingencies such as “account closed”, “payment stopped”, “referred to the drawer”, but while doing so, also observed that expression “amount of money amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient” is required to be given wider meaning. Most importantly, in afore judgment, Hon’ble Apex Court held that very object and purpose of Sections 138 to 142 inserted in the Negotiable Instruments Act is to punish only those who know fully well that they have no amount in the Bank and yet issue a Cheque in discharge of debt or liability already 2026:HHC:20034 -17- borrowed/incurred which amounts to cheating, and not to punish those who refused to discharge the debt for bona fide and sustainable reason. While referring to its earlier decision in M.M.T.C. Ltd. And Anr vs. Medchl Chemical and Pharma (P) Ltd. And Anr., (2002) 1 SCC 234, Hon’ble Apex Court in afore case further held that Cheque dishonour on account of drawer’s stop payment instruction constitutes an offence under Section 138 of the Act, but it is subject to the rebuttable presumption under Section 139 of the Act as the same can be rebutted by the drawer even at the first instance. While referring to Section 139 of the Act, Hon’ble Apex Court held that accused has to show that dishonour was not due to insufficiency of funds but there was valid cause, including absence of any debt or liability for the stop payment instruction to the Bank. Para No.22 of the judgment in Laxmi Dyechem (supra), reads as under: “22. We have to bear in mind that the Legislature while incorporating the provisions of Chapter XVII, Sections 138 to 142 inserted in the NI Act (Amendment Act 1988) intends to punish only those who know fully well that they have no amount in the bank and yet issue a cheque in discharge of debt or liability already borrowed/incurred -which amounts to cheating, and not to punish those who refused to discharge the debt for bona fide and sustainable reason. It is in this context that this Hon’ble Court in the matter of M.M.T.C. Ltd. And Anr vs. Medchl Chemical and Pharma (P) Ltd. And Anr., (2002) 1 SCC 234, was pleased to hold that cheque dishonour on account of drawer’s stop payment instruction constitutes an offence under Section 138 of the NI Act but it is subject to the rebuttable presumption under Section 139 of the NI Act as the same can be rebutted by the drawer even at the first instance. It was held therein that in order to escape liability under Section 139, the accused has to show that dishonour was not due to 2026:HHC:20034 -18- insufficiency of funds but there was valid cause, including absence of any debt or liability for the stop payment instruction to the bank. The specific observations of the Court in this regard may be quoted for ready reference which are as follows: “19. ….The authority shows that even when the cheque is dishonoured by reason of stop-payment instructions by virtue of Section 139 the court has to presume that the cheque was received by the holder for the discharge, in whole or in part, of any debt or liability. Of course this is a rebuttable presumption. The accused can thus show that the “stop-payment” instructions were not issued because of insufficiency or paucity of funds. If the accused shows that in his account there were sufficient funds to clear the amount of the cheque at the time of presentation of the cheque for encashment at the drawer bank and that the stop-payment notice had been issued because of other valid causes including that there was no existing debt or liability at the time of presentation of cheque for encashment, then offence under Section 138 would not be made out. The important thing is that the burden of so proving would be on the accused. Thus a court cannot quash a complaint on this ground.” Therefore, complaint filed in such a case although might not be quashed at the threshold before trial, heavy onus lies on the court issuing summons in such cases as the trial is summary in nature.” 19. At this stage, this Court finds it necessary to refer to the judgment passed by Hon’ble Apex Court in Vinod Tanna (supra), which has been pressed into service by learned counsel representing the petitioner. If the judgment in Laxmi Dyechem (supra), rendered in the year 2012, is perused in its entirety, it clearly reveals that its earlier judgment rendered in Vinod Tanna (supra) has been taken note of, but for the reasons given in detail, it virtually differed with its earlier decision, wherein it was ruled that 2026:HHC:20034 -19- dishonour of Cheque because of reasons other than insufficiency of funds in the bank account of the drawer did not attract Section 138 of the Act. In the instant case, there is another aspect of the matter that Cheques in question were issued by the accused towards discharge of lawful liability to the complainant, who in turn presented the same before the Bank of the accused, but the same were returned with remarks ‘Present with document’. There is no indication whatsoever as to the nature of the documents required to be produced by the complainant along with the Cheques. Complainant otherwise cannot be expected to present documents, if any, on behalf of accused, even if they were required to be submitted along with the cheque issued by him or her, rather, in such a situation, clarification, if any, was required to be sought by the Bank concerned from the accused, who had issued the Cheque. 20. Since net result of remarks ‘Present with document’ is refusal on the part of the banker of accused to make payment, complainant had no option but to institute proceedings under Section 138 of the Act, especially when accused failed to pay the amount, after his having received the legal notice. As has been held by Hon’ble Apex Court that expression “amount of money amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient” is a genus and other are species, 2026:HHC:20034 -20- expression used by banker of accused while returning the Cheques i.e. ‘Present with document’ would also amount to insufficiency of funds. In the instant case, Cheques issued by accused in favour of complainant were at first instance presented by complainant before its banker, which subsequently sent the same for clearance to the banker of the accused. If there was any problem or there was any requirement of documents, if any, to be adduced on record by the complainant, banker of the complainant must have returned the same to complainant for resubmitting the same with requisite documents. However, in the instant case, banker of the complainant accepted the same, without there being any objection and thereafter, sent the same for clearance to the banker of the accused, which returned the same with remarks ‘Present with document’. Since banker of the accused while returning the Cheques did not clarify with regard to nature of documents required to be produced by complainant or by accused, coupled with the fact that complaint under Section 138 of the Act could have been filed by the complainant within stipulated period of limitation, no illegality can be said to have been committed by the complainant while instituting complaint under Section 138 of the Act. 21. Moreover, this Court, having taken note of grounds raised in the instant petition for quashing the complaint, is compelled to draw an inference that there was no ‘insufficiency of funds’ in the account of the accused and had banker of the accused not raised objection i.e. ‘Present 2026:HHC:20034 -21- with document’, Cheque issued in favour of complainant would have been encashed. Sole ground raised in the instant petition for quashing of complaint is that Cheques in question were not dishonoured on account of insufficient funds and as such, complaint under Section 138 of the Act is not maintainable. Immediately, after issuance of process, accused with a view to show his bonafides could always make a statement before the learned trial Court that he is ready to pay the amount, as is being claimed through the demand notice, as has been held by Hon’ble Apex Court in the case of C.C. Alavi Haji Vs. Palapetty Muhammed & Another, (2007) 6 SCC 555. Relevant Para of afore judgment read as under: “17. It is also to be borne in mind that the requirement of giving of notice is a clear departure from the rule of Criminal Law, where there is no stipulation of giving of a notice before filing a complaint. Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under Section 138 of the Act, make payment of the cheque amount and submit to the Court that he had made payment within 15 days of receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the Court along with the copy of the complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the G.C. Act and Section 114 of the Evidence Act. In our view, any other interpretation of the proviso would defeat the very object of the legislation. As observed in Bhaskarans case (supra), if the giving of notice in the context of Clause (b) of the proviso was the same as the receipt of notice a trickster cheque drawer would get the premium to avoid receiving the notice by 2026:HHC:20034 -22- adopting different strategies and escape from legal consequences of Section 138 of the Act.” 22. Though finding returned in aforesaid judgment is in context of service of notice, if any, upon accused through demand notice, but same can be made applicable in the facts and circumstances of the present case, where though there appears to be no dispute with regard to claim of the claimant, but the same is being refuted only on the ground that Cheque was not dishonored on account of insufficient funds. Though at this stage, it may be too premature to conclude that factum with regard to issuance of Cheque as well as signatures thereupon are not in dispute, but certainly having taken note of grounds raised in the petitions, this Court, for the disposal of the present petition, can always presume that accused could have no objection qua the maintainability of the present petitions under Section 138 of the Act, had Bank concerned returned the Cheques with remarks ‘funds insufficient’. There is nothing on record to suggest that liability to pay the Cheque amount is in dispute, rather, quashment of complaints have been sought on the ground that Cheques in question were not returned on account of ‘insufficient funds’ in the Bank account of the accused. In afore situation, this Court is persuaded to agree with learned counsel representing the complainant that immediately after receipt of summons, accused, with a view to show his bonafides, could have come forward to make the payment qua the Cheque amount. 2026:HHC:20034 -23- 23. Moreover, summoning orders in the petitions at hand were passed on 06.05.2022, wherein direction came to be issued to accused to remain present in learned trial Court on 05.08.2022. Though accused put in appearance on the given date, but he never raised objection qua maintainability of complaints at the time of framing of notice of accusation, rather approached this Court in the instant proceedings. Petitioner herein filed petitions at hand in December 2022, but same remained pending for more than three years, as a result thereof, limitation period, if any, for filing the suit for recovery of amount at the behest of complainant has already expired. In the event of accepting the grounds raised at the behest of petitioner for quashing of complaints, which otherwise are not tenable, would finally close the doors for complainant for all times to come for redressal of his grievance i.e. recovery of amount. 24. Consequently, in view of detailed discussions made hereinabove as well as law taken into consideration, this Court does not find the cases at hand to be fit for exercising power under Section 482 of Cr.P.C. (now Section 528 of BNSS) for quashing the complaints, which otherwise for the discussions made hereinabove appear to be maintainable in the competent Court of law. Accordingly, the petitions at hand fail and are dismissed. 25. Learned counsel representing the parties undertake to cause presence of their respective clients before the learned trial Court on 24.06.2026, enabling it to proceed with the matter further. Needless to say, 2026:HHC:20034 -24- observations/findings, if any, given in the instant judgment have been made for the purposes of disposal of the petitions at hand and same shall have no bearing, if any, whatsoever, on the final outcome of the complaints filed under Section 138 of the Act, which shall be decided by the Court concerned on the basis of pleadings as well as totality of evidence led on record by the respective parties in accordance with law. The present petitions are disposed of in the above terms, so also the pending miscellaneous application(s), if any. May 26, 2026 (Sandeep Sharma), Rajeev Raturi Judge RAJEEV RATURI Digitally signed by RAJEEV RATURI Date: 2026.06.03 16:33:34 +0530