The High Court of Chhattisgarh has dismissed two acquittal appeals filed by a complainant against the acquittal of an accused in a case involving the dishonour of cheques totaling ₹35,00,000. The Court held that the complainant failed to establish the existence of any legal liability or debt, noting a significant lack of documentary evidence regarding the alleged cash transaction and the complainant’s financial capacity.
Background
The case originated from a dispute involving respondent Mahendra Singh Thakur, who was engaged in the business of purchase and sale of land. The appellant, Anup Gidwani, alleged that he had paid ₹35,00,000 in cash to the respondent as an advance for the purchase of land. When the respondent failed to execute the sale deed or return the money, he purportedly issued two cheques (bearing Nos. 968460 and 968461) drawn on Punjab National Bank, Raipur.
Upon presentation, both cheques were dishonoured due to “insufficient funds.” Following the non-payment after legal notices, complaints were filed under Section 138 of the Negotiable Instruments Act, 1881. The Judicial Magistrate First Class, Raipur, initially convicted the respondent in 2016, sentencing him to six months of rigorous imprisonment and a total compensation of ₹35,00,000. However, the Additional Sessions Judge, Raipur, set aside these convictions on August 31, 2017, leading the complainant to appeal to the High Court.
Arguments of the Parties
The appellant’s counsel argued that since the issuance of the cheques and the signatures were admitted, statutory presumptions under Sections 118 and 139 of the NI Act must operate in favour of the complainant. He contended that the burden of proof had shifted to the respondent to rebut these presumptions and claimed the defense that the cheques were obtained under threat was a “false afterthought.”
Conversely, the respondent’s counsel submitted that the complainant failed to prove any legal liability. He highlighted the absence of documentary evidence for the ₹35,00,000 cash payment and the appellant’s failure to establish the source of such funds. The respondent further argued that he had issued “stop payment” instructions to his bank on August 29, 2012—prior to the presentation—probabilizing his defense that the cheques were not issued for a legal debt.
Court’s Analysis and Observations
Justice Radhakishan Agrawal, presiding over the matter, emphasized the scope of interference in appeals against acquittal, citing the Supreme Court’s decision in Jafarudheen and others vs. State of Kerala (2022), which states that the appellate court should be “relatively slow in reversing the order of the trial court rendering acquittal” unless there is a clear illegality.
The Court observed several inconsistencies in the complainant’s testimony (PW-1):
- Financial Capacity: The complainant admitted his annual income was only about ₹3,50,000, yet claimed to have paid ₹35,00,000 in cash.
- Lack of Documentation: No income tax returns or bank statements were produced to prove the availability or payment of the sum.
- Vagueness of Transaction: The complainant could not specify which land was to be sold, the rate, the location of payment, or any witnesses to the transaction.
The Court noted:
“the evidence of the complainant/appellant does not inspire confidence and fails to establish the existence of any legal liability.”
In contrast, the Court found the respondent’s defense (DW-1) probable. The respondent had proved documents (Ex.D-1 to Ex.D-3) showing he had instructed the bank to stop payment before the dispute reached the court. Referring to Kamla S. vs Vidhyadharan M.J. (2007), the Court reiterated that while Section 139 carries a presumption, it is rebuttable through a “preponderance of probability.”
The Court further stated:
“It is pertinent to mention that for a transaction involving such a large amount, some documentary evidence would ordinarily be expected; however, no such evidence has been produced in the present case. This creates serious doubt about the alleged cash advance payment of Rs.35,00,000.”
Decision
The High Court concluded that the respondent had successfully raised a probable defense sufficient to rebut the statutory presumptions. It held that the Appellate Court’s view was “legally plausible” and did not suffer from any perversity. Consequently, both acquittal appeals were dismissed.
Case Details:
- Case Title: Anup Gidwani vs. Mahendra Singh Thakur
- Case No.: ACQA No. 15 of 2018 and ACQA No. 16 of 2018
- Bench: Justice Radhakishan Agrawal
- Date: 10/04/2026
