Criminal Appeal No.14 of 2009

12th January, 2009

Petitioner Counsel: Mr. P. M. YELNOORKAR
Respondent Counsel: Mr. V. H. DIGHE

Cases Cited:
Hiten P. Dalal Vs. Bratindranath Banerjee, 2001 ALL MR (Cri) 1497 (S.C.)=2001 SCC (Cri) 960 [Para 10]
Chandrakant Ratilal Mehta Vs. State of Maharashtra, 1993 Cri.L.J. 2863 [Para 13]

JUDGMENT

JUDGMENT :- Challenge in this appeal is to judgment of acquittal rendered by learned Judicial Magistrate (F.C.), in Summary Criminal Case No.1525/1997 whereby and whereunder respondent No.1 - Jiyalal came to be acquitted of offence punishable under section 138 of the Negotiable Instruments Act, 1881.

2. There is no dispute about the fact that the appellant and the respondent No.1 were acquainted with each other. So also, there is no dispute about the fact that the respondent No.1 issued a cheque No.C532820 dated 16-01-1996 for Rs.20,000/- drawn on the United Western Bank Limited, Aurangabad, in favour of the appellant/complainant. The cheque in question (Exh-26) was presented by the appellant to his Bank, namely, the Indian Overseas Bank, Aurangabad branch. The cheque was returned to him on 28-02-1996 with an endorsement "funds not arranged for". The cheque had bounced and as such, a demand notice was issued to the respondent No.1 on 06-03-1996 by the appellant through his advocate. The demand notice was duly served on him. The respondent No.1 gave reply dated 30th March, 1996 whereby he denied the existence of liability to pay the amount shown in the cheque. The appellant thereafter filed the private complaint case for offence punishable under section 138 of the Negotiable Instruments Act against the respondent No.1.

3. At the trial, the appellant examined himself in support of his case. The respondent No.1 examined himself and DW Sanjay in order to buttress his defence. It was the defence of the respondent No.1 that he had agreed to purchase eight (8) plots from the appellant of 25 feet x 30 feet each at rate of Rs.10,000/- for each of them. He had paid advance amount of Rs.6,000/- in cash when the agreement of sale was orally settled. He issued the cheque in question (Exh-26) towards further payment of earnest amount in pursuance to the agreement of sale. He later on came to know that the appellant was not owners of those plots and the two (2) plots which were owned by him were already sold in favour of one Shri. Tufane. It was due to frustration of the oral agreement of sale that he did not arrange for payment of the amount shown under the cheque.

4. The learned Judicial Magistrate came to conclusion that there was transaction in respect of plots between the parties. The learned Judicial Magistrate did not believe version of the appellant in respect of hand-loan of Rs.20,000/- given to the respondent No.1. The learned Judicial Magistrate held that tape recording of the conversation between the parties duly corroborated the defence and version of DW Sanjay, in this behalf, could not be discarded. Hence, it was held that the appellant failed to prove existence of legal liability for payment of Rs.20,000/-. Consequently, the respondent No.1 came to be acquitted of the charge. Though served, none appeared for the respondent No.1 (accused) in this Court.

5. Heard learned advocate Mr. P. M. Yelnoorkar for the appellant and learned A.P.P. Mr. V. H. Dighe for the respondent No.2/State.

6. Before I proceed to embark upon scrutiny of the evidence tendered by the parties, let it be noted that there is no documentary evidence to show that the respondent No. 1 - Jiyalal had entered into an agreement of sale in respect of specific plots owned by the appellant. Nor there is any iota of evidence on record to show that the appellant owned open plots, which were available for sale at the material time. It is further not explicit as to what was the description of the so called plots which were subject of the alleged agreement of sale. It is vaguely stated by the respondent No.1 that the plots were situated in Jaibhavaninagar locality. No extract of municipal register or 7/12 record was produced about ownership of the so called plots.

7. The testimony of PW-1 Lalji (appellant) purports to show that the respondent No.1 expressed need of money and, therefore, Rs.20,000/- was given by him on obtaining the cheque dated 16-01-1996 (Exh-26). He admits that the cheque was obtained from the respondent No.1 by way of security for the repayment. His version purports to show that the respondent No.1 (accused) instructed him not to present the said cheque in the Bank for encashment. His version reveals that subsequently he presented the cheque in the Indian Overseas Bank after about one (1) month. The cheque could not be encashed as the money was not arranged for in the account of the respondent No.1. The relevant memorandum (Exh-27) alongwith Bank's slip (Exh-28) were produced by him. He corroborated recitals of the demand notice (Exh-29). As stated earlier, there is no dispute about service of the demand notice on the respondent No.1. The respondent No.1 gave reply to the notice vide Exh-35.

8. Cross-examination of PW Lalji reveals that since about one (1) year before the transaction in question, he was knowing the respondent No.1/accused. His version reveals that he was previously dealing in business as a Security Contractor at Mumbai. He deposed that he paid Rs.20,000/- to the respondent No.1 contemporaneously at the time of issuance of the cheque (Exh-26). It is suggested to him that he had agreed to sell six (6) plots to the respondent No.1 - Jiyalal. He denied the suggestion as regards agreement of sale in respect of six (6) plots. He also denied that an amount of Rs.6,000/- was paid to him towards earnest money in respect of the said transaction. Noting of much importance could be gathered from his cross-examination.

9. The version of DW Jiyalal would show that he had orally agreed to purchase eight (8) plots at rate of Rs.10,000/- each from the appellant. He further deposed that he had given Rs.6,000/- as earnest money to the appellant, in pursuance to the oral agreement of sale. According to DW Jiyalal, a co-worker by name Mukundlal had purchased one (1) plot from the appellant. He had accompanied to said Mukundlal to house of the appellant for payment of remaining consideration by said Mukundlal to the latter. It was at the time of such visit that the oral negotiations were made and the sale transactions were settled between them. Significantly, said Mukundlal was not examined in order to prove such kind of oral agreement. So also, when it was the first time of DW Jiyalal to come in contact with the appellant, then it does not stand to reason why receipt about payment of Rs.6,000/- was not obtained by him. Though he claims that he had agreed to purchase eight (8) plots, yet, it was suggested to PW Lalji (appellant) that the agreement was in respect sale of six (6) plots.

10. Clinching question in this case is whether the presumption under section 139 of the Negotiable Instruments Act is rebutted by the respondent No.1. The learned Judicial Magistrate did not consider the effect of legal presumption available under section 139 of the Negotiable Instruments Act in its proper perspective. The Apex Court in "Hiten P. Dalal Vs. Bratindranath Banerjee" 2001 SCC (Cri) 960 : [2001 ALL MR (Cri) 1497 (S.C.)], has held that mere plausible explanation given by the accused is not enough. The accused has to necessarily prove in the trial, by leading cogent evidence, that there was no debt or liability. The burden of proof is on the accused to rebut the legal presumption enumerated under sections 139 and 118 of the Negotiable Instruments Act. Once it is established that the cheque was issued by the accused, then the burden shifts on him to prove that it was not issued in order to discharge any existing legal liability for repayment of the debt. The standard of proof required for the purpose of rebuttal of such presumption is not, however, heavy. The accused is required to strengthen his defence by showing existence of probabilities of the defence being truth bearing. The standard of proof in such a case would be that of a standard comparable to civil cases and would lie between the range of probability and possibility. Needless to say, the defence is not required to prove the defence being true upto the hilt.

11. Having considered the above mentioned legal position, I shall now examine whether the respondent No.1 has discharged his burden of rebuttal in the present case. As stated before, there is no documentary evidence to show that the appellant owned any plot in Jaibhavaninagar locality, Garkheda, Aurangabad. There is also no iota of evidence on record to show that oral agreement was settled in presence of Mukundlal Vishwakarma, who is the friend of the respondent No.1. The reply notice (Exh-35) shows that the respondent No.1 learnt that the appellant was not owner of six (6) plots which were agreed to be alienated. However, he was owner of the two (2) plots which he had already transferred in favour of one Shri. Tufane. The identity of said Shri. Tufane is rendered into obscurity. No attempt was made to examine said Shri Tufane. I mean to say, it was incumbent on the respondent No.1 (accused) to probabalize the defence that the appellant was, in fact, dealing in plotting business and had several such transactions with other customers. In any case, there was no difficulty in filing a copy of registered sale-deed in respect of the plot which was sold to Shri. Tufane by the appellant. No such effort was made by the respondent No.1. Nor it is suggested during cross-examination of PW Lalji that he had alienated those two (2) plots to one Shri Tufane and thereby had cheated the respondent No.1 in respect of the transaction of sale in respect of the two (2) plots.

12. The version of DW Jiyalal reveals that since he had no documentary evidence with him, he got recorded conversation with the appellant on a tape-recorder with the aid of DW Sanjay. The learned Judicial Magistrate appears to have given undue importance to such tape-recorded conversation. The version of DW Sanjay purports to show that the respondent No.1 was his tenant in respect of one (1) room. He deposed that the respondent No.1 had agreed to purchase a plot from the appellant but because there was no document in respect of such transaction, tape-recorded conversation was brought into existence. He had carried the pocket tape-recorder with him when both of them met each other after eight (8) days of service of the demand notice. In other words, DW Sanjay has no personal knowledge in respect of the sale transaction between the parties, but was called upon by the respondent No.1 after about one (1) week of receipt of the demand notice (Exh-29). According to the defence, the notice was received by the respondent No.1 on 15th March, 1996. Thus, the so called tape-recording was done in the 3rd week of March, 1996 before the reply to the notice (Exh-35) was issued. The reply to the notice (Exh-35) does not refer to such tape-recorded conversation between the parties. This is a glaring omission.

13. The pocket tape-recorder was not immediately produced in the Court. It was not sealed as per the requirement of the law. The transcription of the tape-recorded conversation was also not produced in the Court. Nor it was ever confronted to PW Lalji during his cross-examination. This Court, in "Chandrakant Ratilal Mehta and others Vs. The State of Maharashtra" 1993 Cri.L.J. 2863, held that for the tape-recorded evidence if is to be acceptable, the tape must have been sealed at earliest point of time and opened except under orders of the Court. The precautions which are required to be taken for the purpose of admitting tape-recorded version in the evidence are not taken in the present case. It is difficult to countenance the defence only on the basis of so called tape-recorded version of which origin is very much doubtful. Needless to say, the respondent No.1 (accused) failed to discharge the burden of proof in order to rebut the legal presumption available under sections 118 and 139 of the Negotiable Instruments Act.

14. Considering the foregoing discussion, it follows that the appellant duly proved the fact that he had lent Rs.20,000/- to the respondent No.1 against issuance of the cheque (Exh-26) by the latter. It is duly proved that the respondent No. 1 failed to arrange for payment of the money without any legal reasons. Hence, the impugned judgment of acquittal is unsustainable. The offence is duly proved and, therefore, I have no hesitation in holding that the respondent No.1 - Jiyalal is guilty for offence punishable under section 138 of the Negotiable Instruments Act. He was unavailable, in order to know as to his stance in respect of quantum of sentence. I deem it proper to hold that much leniency is not warranted.

15. In the result, the appeal is allowed. The impugned judgment is set aside. The respondent No.1 is held guilty for offence punishable under section 138 of the Negotiable Instruments Act, 1881 and is sentenced to suffer simple imprisonment for three (3) months and to pay fine of Rs.25,000/-, in default to suffer simple imprisonment for further three (3) months' period. If the fine amount is recovered, an amount of Rs.20,000/- be made over to the appellant by way of compensation under section 357(3) of the Criminal Procedure Code. The Trial Court shall issue warrant of arrest of the respondent No.1 - Jiyalal, for the purpose of execution of his sentence. The record and proceedings be sent to the Trial Court without delay.

Appeal allowed.