Sri Shankarlal vs. M/S Mayur Gold

Upon hearing the learned counsel for both parties and on consideration of the prayer in the application as well as the objections filed by the complainant, the learned HC-KAR NC: 2025:KHC:35047 Magistrate rejected the application. The Court held that the documents sought to be summoned by the accused were not relevant for adjudicating the core controversy between the complainant and the accused and accordingly, declined to issue summons for their production.

Assailing the said order, learned counsel for the petitioner contends that the complainant has already produced invoices and GST returns for the year 2018 in respect of other transactions. It is, therefore, urged that the petitioner was constrained to invoke Section 91 of the Cr.P.C to summon the Stock Register for the aforesaid period at the stage of cross-examination of the complainant.

I have heard the submissions of the learned counsel for the petitioner and carefully perused the private complaint instituted under Section 200 of the Cr.P.C., along with the material placed on record. HC-KAR NC: 2025:KHC:35047

This Court has bestowed its anxious consideration upon the prayer made in the application filed by the petitioner under Section 91 of the Code of Criminal Procedure. The Court has also carefully examined the objections filed by the complainant opposing the said application, as well as the overall circumstances emerging from the record.

The complainant has instituted a private complaint under Section 200 of the Code of Criminal Procedure alleging commission of an offence punishable under Section 138 of the Negotiable Instruments Act, 1881. In the complaint, it is alleged that the petitioner–accused purchased gold ornaments valued at Rs.22,80,000/-. Towards discharge of the said liability, the petitioner is stated to have issued two cheques bearing Nos.466977 and 466975, each for a sum of Rs.11,40,000/-, drawn on Syndicate Bank. The complainant avers that, upon presentation, both cheques were dishonoured with the bank endorsement “Funds Insufficient”. After service of HC-KAR NC: 2025:KHC:35047 the statutory demand notice issued under Section 138(b) of the Negotiable Instruments Act and the failure of the petitioner to comply with the demand within the prescribed period, the complainant initiated the present prosecution by filing a private complaint under Section 200 of the Cr.P.C.

Learned counsel for the petitioner has strenuously urged that the documents sought to be produced through the application under Section 91 of the Cr.P.C namely the Stock Register for the relevant period are essential for the defence of the accused. However, on a specific query from this Court, learned counsel candidly conceded that the petitioner had not issued any reply to the statutory notice served by the complainant under Section 138(b) of the Negotiable Instruments Act. The primary defence set up by the petitioner in the pending proceedings is that he never issued the cheques in question and that there were no business transactions whatsoever between him and the complainant. HC-KAR NC: 2025:KHC:35047

It is well settled, as reiterated by this Court in a series of judgments, that once a cheque is drawn by the accused and presented for encashment and such cheque is returned unpaid for want of funds, a presumption under Section 139 of the Negotiable Instruments Act operates in favour of the complainant, the holder of the cheque that the instrument was issued in discharge of a legally enforceable debt or other liability. This presumption, however, is rebuttable, and it is open to the accused to adduce evidence to displace it. The petitioner, while asserting that the cheques were allegedly handed over to a third party and misused by the complainant, must necessarily establish these facts through cogent rebuttal evidence during the course of trial.

This Court has, on several occasions, held that the details of the underlying transaction between the complainant and the accused may not always be of determinative relevance at the stage of considering an application under Section 91 of the Cr.P.C. The principal HC-KAR NC: 2025:KHC:35047 issue that falls for adjudication in proceedings under Section 138 of the Negotiable Instruments Act is whether the cheque was issued by the accused in discharge of a legally enforceable liability. If the petitioner contends that the cheques were never meant for the complainant and were misused after having been delivered to a third party, the onus lies squarely on him to prove such defence in accordance with law.

Likewise, the petitioner’s submission that some of the invoices produced by the complainant pertain to 2019, whereas the GST returns relate to 2018 is a matter of appreciation of evidence. Such aspects can be urged by the petitioner during the course of arguments after completion of trial. Reserving to the petitioner the liberty to canvass these defences at the appropriate stage, no ground is made out for interference with the impugned order rejecting the application under Section 91 of the Cr.P.C. HC-KAR NC: 2025:KHC:35047 Accordingly, the petition stands disposed of, reserving the aforesaid liberty to the petitioner. (SACHIN SHANKAR MAGADUM) JUDGE