He waited until final arguments to ask whether the Branch Manager was ever authorised to file the case

The witness had said so on affidavit and was never asked about it in the box. The Himachal Pradesh High Court holds that the objection came far too late, and upholds the cheque-bounce conviction.

When the payee on a dishonoured cheque is a company, a bank or a co-operative society, somebody has to file the complaint on its behalf, and that person’s authority is a real requirement — a complaint filed by a person with no authority is not a complaint by the payee at all. It is also, in practice, one of the easiest objections to raise and one of the easiest to answer, provided it is raised at a point when it can still be answered.

On 29 July 2026 Justice Rakesh Kainthla dealt with the version of that objection that arrives too late to be answered.

A ₹10 lakh loan and a ₹95,000 cheque

The complainant was the H.P. State Co-operative Agriculture and Rural Development Bank, a co-operative society engaged in banking. The accused, Dola Singh, had taken a loan of ₹10,00,000 and issued a cheque of ₹95,000 towards part repayment. The cheque was presented and returned with the endorsement “funds insufficient”. A legal notice went out calling for payment within fifteen days of receipt; it was served, and nothing was paid. The complaint under Section 138 of the Negotiable Instruments Act followed.

The Bank examined one witness, Dhale Ram (CW-1). The accused denied the case entirely in his statement under Section 313 of the Code of Criminal Procedure and examined himself as DW-1, saying the cheque had been given as security and misused.

The Judicial Magistrate First Class, Banjar, convicted him on 1 May 2024. The Sessions Judge, Kullu upheld the conviction and sentence on 15 January 2025. The revision came to the High Court.

Three objections, and what happened to each

Mr. N.K. Bhardwaj for the accused argued that the courts below had failed to appreciate the material; that the defence of a misused security cheque was highly probable on the accused’s own statement; that the Bank had never placed on record the authority of the Branch Manager to file the complaint, so the complaint was not maintainable; and that the demand notice did not name the person on whose behalf it was issued and was therefore defective. He relied on Jaipur Thar Gramin Bank, Branch Jaisalmer v. State, 2022 (1) Civil Court Cases 668 (Rajasthan) and Mansa Central Co-operative Bank Ltd. v. Lachhman Singh, 2023 (4) Civil Court Cases 460 (P&H).

Mr. Narender Singh Thakur for the Bank met the authority point with a procedural answer rather than a documentary one: CW-1 had deposed that he was authorised to file the complaint, that testimony was never challenged in cross-examination, and the plea could not be taken for the first time in the High Court. Mr. Tarun Pathak, Deputy Advocate General, said the dispute lay between private parties and the State had no submission to make.

The Court took the authority objection first, and its treatment is the part of the judgment worth keeping. Dhale Ram had stated specifically in his proof affidavit that he was the Branch Manager, conversant with the facts, and duly authorised to file the complaint on behalf of the Bank. He was not cross-examined on any of it. No question was put to him about his authority. His testimony that he was competent to file the complaint therefore stood unrebutted.

For the consequence, Justice Kainthla relied on State of Uttar Pradesh v. Nahar Singh, (1998) 3 SCC 561 — where a witness’s testimony is not challenged in cross-examination, it cannot be challenged during arguments — a position reiterated in Arvind Singh v. State of Maharashtra, (2021) 11 SCC 1, on the purpose of cross-examination in testing a witness’s veracity.

The rule is not a technicality. Cross-examination is the moment at which an assertion of authority can be probed — the resolution can be called for, the date of authorisation tested, the signatory identified. A party that lets that moment pass and raises the point in final argument is asking the court to disbelieve evidence the other side had no notice it needed to support.

The notice and the security cheque

The objection to the demand notice was rejected almost as soon as it was stated. The notice itself recorded that it was issued on behalf of the H.P. State Co-operative Bank, Agricultural and Rural Development Bank Ltd., Branch Banjar. The cheque was in the name of the same bank, and the complaint was filed in its name. The person on whose behalf the notice was issued was therefore specifically mentioned, and Mansa Central Co-operative Bank did not apply.

Service was proved from the accused’s own mouth: he admitted in cross-examination that he had received the notice and that the acknowledgement bore his signature. He never claimed to have repaid after receiving it.

On the security-cheque defence, the Court applied the settled position that a cheque issued as security is not waste paper, and that a drawer who signs a cheque and hands it to the payee is presumed liable under Section 139 unless he leads evidence to rebut the presumption. Here the accused led none — no document showing return of the money, no evidence that the full amount due had been paid. The story that the cheque was given as security was not believable without more.

All the ingredients of the offence being satisfied, the conviction was sound.

A word on the compensation

The closing passage runs against the complainant. The Bank had been deprived of the interest it would have earned had it advanced the money to others, and had to engage counsel and prosecute the complaint; it was entitled to be compensated for that, and on those circumstances the Court considered the ₹5,000 awarded by the trial court inadequate.

But the Bank had filed no appeal for enhancement of the sentence, and the High Court declined to interfere with the amount on its own. The revision failed and was dismissed, with the record of the courts below to be returned along with a copy of the judgment.

Two parties, then, each lost something to the same principle. The accused lost a maintainability point because he did not put it to the witness. The Bank lost an enhancement it might have had because it did not appeal. Neither outcome turns on the merits of the cheque.