The High Court of Himachal Pradesh, in a judgment delivered by Justice Rakesh Kainthla, has dismissed an appeal against an acquittal in a cheque bounce case, ruling that the statutory presumption under the Negotiable Instruments Act (NI Act) can be successfully rebutted through the cross-examination of the complainant. The court observed that if the transaction itself is shown to be inherently improbable and contrary to normal human conduct, the accused is not required to lead independent defense evidence or enter the witness box to discharge their burden.
Background of the Case
The appellant, Rakesh Kumar, filed a complaint under Section 138 of the NI Act against the respondent, Sunil Khachi. The complainant asserted that he had lent Rs. 60,000/- to the accused for a business transaction. To repay the amount, the accused issued a cheque for the same value. However, when the complainant presented the cheque to his bank, it was dishonoured with an endorsement of “insufficient funds.” Despite the complainant issuing a demand notice, which was deemed served, the accused failed to pay the amount, leading to the filing of the complaint.
The accused pleaded not guilty to the accusation and claimed to be tried. In his statement recorded under Section 313 of the Code of Criminal Procedure (CrPC), the accused asserted that he had issued a blank cheque to one Khajan Chand, who then handed it over to the complainant. The accused did not produce any defense evidence.
On May 28, 2012, the Judicial Magistrate, First Class, Court No.3, Shimla, acquitted the accused. The trial court pointed out that the complainant was a resident of Hamirpur and a friend of Khajan Chand, whereas he had met the accused for the first time in July/August 2007 at Khajan Chand’s shop in Theog. Finding it highly improbable that the complainant would advance a loan to someone he barely knew, and noting that Khajan Chand was not examined to corroborate the transaction, the trial court held that the accused had successfully rebutted the statutory presumption.
Arguments of the Parties
The appellant challenged the acquittal, arguing that since the accused admitted his signature and the issuance of the cheque, the presumptions under Sections 118(a) and 139 of the NI Act were triggered. The appellant contended that the burden of proof had shifted to the accused, who failed to lead any evidence in his defense. It was further argued that the trial court erred in shifting the burden to examine Khajan Chand onto the complainant when the defense version of handing the cheque to Khajan Chand was asserted by the accused.
Conversely, the respondent argued that the trial court had correctly appreciated the evidence. The respondent contended that it was highly unlikely for a person to advance Rs. 60,000/- to a near-stranger met only a week prior. Arguing that the trial court had taken a reasonable and possible view, the respondent prayed for the dismissal of the appeal.
Court’s Analysis and Observations
Justice Rakesh Kainthla began the analysis by highlighting the established legal parameters for interfering with a judgment of acquittal. Citing the Supreme Court judgment in Surendra Singh v. State of Uttarakhand (2025), the High Court noted:
“It could thus be seen that it is a settled legal position that the interference with the finding of acquittal recorded by the learned trial Judge would be warranted by the High Court only if the judgment of acquittal suffers from patent perversity; that the same is based on a misreading/omission to consider material evidence on record; and that no two reasonable views are possible and only the view consistent with the guilt of the accused is possible from the evidence available on record.”
The court also cited State of M.P. v. Ramveer Singh (2025), reiterating that:
“We may note that the present appeal is one against acquittal. Law is well-settled by a plethora of judgments of this Court that, in an appeal against acquittal, unless the finding of acquittal is perverse on the face of the record and the only possible view based on the evidence is consistent with the guilt of the accused, only in such an event, should the appellate Court interfere with a judgment of acquittal. Where two views are possible, i.e., one consistent with the acquittal and the other holding the accused guilty, the appellate Court should refuse to interfere with the judgment of acquittal.”
The principles from Tulasareddi v. State of Karnataka (2026) were also highlighted to underline that:
“if two reasonable conclusions are possible on the basis of the evidence on record, the Appellate Court should not disturb the findings of acquittal recorded by the Trial Court. Further, if the view taken is a possible view, the Appellate Court cannot overturn the order of acquittal on the ground that another view was also possible.”
Upon reviewing the facts, the High Court observed that the complainant, a resident of Hamirpur, had only visited Theog 8 to 10 times and met the accused just a week before advancing the loan. The court agreed with the trial court that it was highly improbable that the complainant would advance money to a person whom he had met only once at Khajan Chand’s shop, agreeing that the trial court was justified in doubting this version.
Addressing the appellant’s argument regarding the non-examination of Khajan Chand, the High Court held that because the complainant’s testimony was inherently improbable and contrary to normal human conduct, the burden lay on the complainant to examine Khajan Chand to corroborate his claims. Thus, the trial court was correct in drawing an adverse inference against the complainant.
On the issue of the statutory presumption, the court rejected the argument that the acquittal was flawed because the accused had not entered the witness box. The court held:
“The presumption under the NI Act can be discharged by leading the evidence or cross-examining the complainant to bring the material on record. In the present case, the cross-examination of the complainant had exposed the inherent improbability of the complainant’s case and the learned Trial Court was justified in discarding his version.”
Decision of the Court
Finding that the trial court had taken a reasonable view, the High Court held that it would not interfere with the acquittal. The appeal was dismissed, and any pending miscellaneous applications were disposed of.
Under the provisions of Section 437-A of the CrPC (Section 481 of the Bhartiya Nagarik Suraksha Sanhita, 2023), the respondent was directed to furnish bail bonds in the sum of Rs. 25,000/- with one surety to the satisfaction of the trial court within four weeks, which shall remain effective for six months in the event of any Special Leave Petition being filed before the Supreme Court.
Case Details
Case Title: Rakesh Kumar v. Sunil Khachi
Case No.: Cr. Appeal No. 323 of 2012
Bench: Justice Rakesh Kainthla
Date: 19.6.2026
