Cheque Handover Date Discrepancy Does Not Defeat Liability When Signatures Are Admitted: Delhi High Court

The Delhi High Court on 10 August held that a discrepancy regarding the date on which a cheque bearing the defendant's admitted signatures was handed over, does not, by itself, undermine the underlying loan liability.

Justice Neena Bansal Krishna dismissed Rakesh Srivastava's appeal and upheld the 30 April 2026 judgment of the District Judge, which had decreed Pradeep Yadav's recovery suit for Rs. 6 lakh with pendente lite and future interest at 9% per annum. She observed:

"When the cheque having signatures of the Appellant, has been held to have been given by the defendant, the time of handing over the cheque cannot be considered as a contradiction going to the root of the matter."

Yadav claimed that he had advanced Rs. 6 lakh as a friendly loan to Srivastava on 27 February 2020 after Srivastava approached him seeking Rs. 8 lakh for his mother's treatment and personal requirements. When he sought repayment in March 2022, Srivastava allegedly issued a cheque for Rs. 6 lakh dated 2 May 2022. The cheque was returned unpaid on 11 May 2022, following which Yadav served a legal notice on 27 May 2022.

Srivastava denied taking the loan and claimed that the cheque was an old cheque leaf that had been misplaced from his office and subsequently misused. He also challenged Yadav's financial capacity, service of the legal notice, territorial jurisdiction and the award of 9% interest.

The Court noted that Srivastava had admitted in his written statement that the cheque belonged to him and bore his signatures. However, he produced no evidence explaining when or how the cheque was misplaced or how Yadav came into possession of it. It further noted that Srivastava had not asserted that Yadav had access to his office or explained how Yadav had obtained the cheque. It held:

"Furthermore, there is no assertion that the Plaintiff had any access to his office or explanation as to how the Plaintiff came into possession of the said cheque. Such gaps in the assertions of the Defendant, lead to one and only conclusion that it was the Defendant, who had handed over the cheque to the Plaintiff in lieu of the loan of Rs.6,00,000/-, which had been taken by him."

The Bench held that these circumstances established that Srivastava had handed over the cheque to Yadav towards the Rs. 6 lakh loan. It rejected the contention that the discrepancy regarding when the cheque was handed over went to the root of the matter, particularly when Srivastava had admitted that the cheque belonged to him and bore his signatures.

It also upheld the award of 9% interest. It noted that Section 34 of the Code of Civil Procedure, 1908 empowers courts to award pendente lite and post-decree interest even in the absence of an agreed contractual rate.

Accordingly, the High Court dismissed the appeal and upheld the decree for recovery of Rs. 6 lakh with interest.