The Allahabad High Court has reaffirmed that complaints under Section 138 of the Negotiable Instruments Act cannot be quashed at the pre-trial stage merely on the ground that the underlying debt is old, where the cheque was issued, presented, and dishonoured within statutory parameters. The judgment underscores the limited scope of judicial intervention under Section 482 CrPC when statutory presumptions under Section 139 NI Act are triggered.
Background & Facts
The Dispute
The applicant, Dr. Munishwar Gupta, was named as the accused in Complaint Case No. 7980 of 2020 filed by Pankaj Agrawal under Section 138 of the Negotiable Instruments Act at Police Station New Agra, District Agra. The complainant alleged that the applicant had borrowed money from him and, to discharge the liability, issued a cheque in his favour. The cheque was presented to the bank and dishonoured on account of "insufficient funds". A statutory notice under Section 138 was issued and remained uncomplied with, prompting the filing of the criminal complaint.
Key Facts
- The applicant admitted to having borrowed money from the complainant approximately 15 years prior to the issuance of the cheque
- The cheque in question was issued in the year 2020
- The cheque was presented to the bank and dishonoured on or about the date of presentation in 2020
- A legal notice under Section 138 was issued within the statutory period of 30 days from the date of dishonour
- The applicant did not dispute the authenticity of his signature on the cheque
- The applicant claimed the liability had been discharged 15 years ago, rendering the 2020 cheque irrelevant
Procedural History
- 2020: Complaint Case No. 7980 of 2020 filed before Additional Court No. 2, Agra
- 19.07.2022: Summoning order issued by the Presiding Officer, Additional Court No. 2, Agra
- 2026: Application under Section 528 BNSS filed before the Allahabad High Court seeking quashing of the summoning order
Relief Sought
The applicant sought quashing of the summoning order dated 19.07.2022 on the ground that the underlying debt was 15 years old and therefore the prosecution was malicious and legally unsustainable.
The Legal Issue
The central question was whether a complaint under Section 138 of the Negotiable Instruments Act can be quashed at the pre-trial stage on the ground that the debt or liability alleged to have been discharged by the cheque is old, where the cheque was issued, presented, and dishonoured within statutory timelines and the signature is not disputed.
Arguments Presented
For the Appellant
Counsel for the applicant contended that since the original debt was incurred 15 years ago and had allegedly been discharged at that time, the issuance of the cheque in 2020 was not for any subsisting liability. He argued that the prosecution was a mala fide attempt to harass the applicant and that the complaint was legally unsustainable. Reliance was placed on Sasseriyil Joseph v. Devassia to support the argument that stale debts cannot form the basis of a valid prosecution under Section 138.
For the Respondent
The learned Additional Government Advocate contended that the complaint disclosed all ingredients of an offence under Section 138 NI Act: issuance of a cheque, its presentation, dishonour due to insufficient funds, and failure to make payment upon notice. The age of the debt was irrelevant if the cheque was issued in 2020 to discharge a liability, however old, and the statutory presumption under Section 139 applied.
The Court's Analysis
The Court examined the applicability of Section 139 of the Negotiable Instruments Act, which creates a statutory presumption that a cheque was issued for the discharge of any debt or other liability. The Court held that this presumption is rebuttable but must be challenged at trial, not at the pre-trial stage.
"The High Court should not quash the criminal complaint under Section 138 of N.I. Act by going into disputed questions of fact regarding the cheque in question being issued for the discharge of debt or liability. Moreso, when Section 139 of the N.I. Act raises a statutory presumption as regards the cheque being issued for discharge of debt or liability."
The Court relied on the Supreme Court’s recent judgment in Sri Om Sales v. Abhay Kumar @ Abhay Patel (2025 SCC OnLine SC 2897), which categorically held that courts must not conduct a "roving enquiry" into the existence of a debt at the pre-trial stage. The Court emphasized that the burden of rebutting the presumption under Section 139 lies with the accused and must be discharged through evidence during trial.
"The consequences of scuttling the criminal process at a pretrial stage can be grave and irreparable. Quashing proceedings at preliminary stages will result in finality without the parties having had an opportunity to adduce evidence and the consequence then is that the proper forum i.e., the trial court is ousted from weighing the material evidence."
The Court noted that the applicant did not dispute the authenticity of the cheque or his signature. The mere assertion that the debt was 15 years old, without any documentary or testimonial evidence, was insufficient to displace the statutory presumption. The Court further held that the Supreme Court’s decision in Sasseriyil Joseph was factually distinguishable and did not support the applicant’s contention.
The Verdict
The application under Section 528 BNSS was dismissed. The Court held that the summoning order dated 19.07.2022 cannot be quashed at this stage. The trial court is the appropriate forum to examine whether the liability was truly discharged and whether the presumption under Section 139 has been rebutted. The accused retains the right to adduce evidence during trial to challenge the existence of a legally enforceable debt.
What This Means For Similar Cases
Pre-Trial Quashing Is Not a Shortcut to Avoid Trial
- Practitioners must not file Section 482 CrPC applications seeking quashing of Section 138 complaints merely on the basis of age of debt or alleged discharge
- The burden of rebutting Section 139 presumption is on the accused and must be discharged through evidence at trial, not through pleadings alone
- Courts will not entertain speculative defences at the pre-trial stage, even if they appear plausible
Statutory Presumption Under Section 139 Is a Powerful Shield for Complainants
- Where the cheque and signature are not disputed, the complainant need not prove the existence of a debt at the initial stage
- The presumption applies regardless of whether the debt is recent or old, as long as the cheque was issued to discharge a liability
- Defence of prior discharge must be supported by credible evidence - mere assertion is insufficient
Timing of Cheque Issuance Is Not Dispositive
- A cheque issued years after the original debt may still be valid under Section 138 if it was issued to revive, acknowledge, or discharge the liability
- Courts will not inquire into the motive behind issuing a cheque unless there is clear evidence of fraud or collusion
- The focus remains on the act of issuance, presentation, dishonour, and notice - not the origin of the debt
