The disputed questions such as loss of a cheque, prior stop-payment instructions, and the absence of a legally enforceable debt are matters of defence that can only be adjudicated during trial, the High Court of J&K and Ladakh has held.
A bench of Justice Wasim Sadiq Nargal said this while dismissing one Sanjay Gupta’s plea seeking to quash criminal proceedings in a cheque bounce case.
In its decision, the bench upheld the Sub Judge (Special Mobile Magistrate), Rajouri’s order issuing process in response to a complaint under Sections 138 and 142 of the Negotiable Instruments Act.
It noted that the complaint disclosed a prima facie case and found no jurisdictional error warranting interference under Section 528 of the Bharatiya Nagarik Suraksha Sanhita (BNSS).
The contention of Gupta was that the cheque in question belonged to a cheque book reported missing in 2022 and that payment had already been stopped through instructions issued to the bank.
His further argument was that the cheque had been misused and that no legally enforceable liability existed. The complainant before the trial court, however, submitted before the High Court that the cheque had been issued towards repayment of financial assistance amounting to Rs 65.68 lakh.
“The dishonour of the cheque for ‘Payment Stopped by Drawer’ attracted the provisions of the Negotiable Instruments Act,” he said.
Following the arguments, the Court held that once the execution of the cheque is not disputed, the statutory presumption under Section 139 of the Negotiable Instruments Act operates in favour of the holder.
The Court underscored that whether the cheque was lost, misused, or issued in discharge of a legally enforceable debt are factual issues requiring evidence. These issues could not be examined in proceedings invoking the Court’s inherent jurisdiction, it said.
It held that accepting Gupta’s contentions at the threshold would amount to conducting a “mini trial,” which is impermissible while exercising inherent powers under Section 528 BNSS.
While dismissing the plea, the Court directed the trial court to proceed with the complaint expeditiously in accordance with law. It, however, clarified that all defences raised by Gupta remain open to be considered during the course of the trial.
