Criminal Appeal No.234 of 2007

21st July, 2010

Petitioner Counsel: ERANKI PHANI KUMAR
Respondent Counsel: G. VENUGOPL REDDY

Cases Cited:
Hiten P. Dalal Vs. Bratindranath Banerjee, AIR 2001 SC 3897 [Para PARA2]
K. N. Beena Vs. Muniyappan, 2001(2) ALD (Crl.) 824 (SC) [Para PARA2]
Rangappa Vs. Mohan, AIR 2010 SC 898 [Para PARA2]

JUDGMENT

-Unsuccessful complainant in the case relating to offence punishable under Section 138 of the Negotiable Instruments Act (in short, the Act) is the appellant herein. He filed C.C. No.289 of 2003 on the file of Special Judicial Magistrate of the First Class for Excise Cases, Mahaboobnagar against the accused alleging offence under Section 138 of the Act on the ground that the accused borrowed hand loan of ' 70,000/- on 03.05.2000 and that subsequently the accused gave Ex.P-1 cheque dated 04.09.2002 for ' 1,09,200/- to the complainant towards settlement of the said debt and that the said cheque when presented for encashment, was dishonoured as per Ex.P-2 dishonour memo. After issuing Ex.P-3 statutory notice, the complainant filed the case in the lower court. During trial in the lower court, the complainant examined himself as P.W.1 and marked as Exs.P-1 to P-7 on his behalf. No evidence was let in by the accused. The lower Court after considering contentions of both the parties, found the accused not guilty of the offence under Section 138 of the Act and acquitted the accused.

2. There is no dispute about Ex.P-1 cheque containing signature of the accused. The banker also did not dispute signature of the accused contained in Ex.P-1. It is contention of the accused that the accused and the complainant's brother Mohanlal did joint business in real-estate ventures and that in that connection, the accused handed over a blank cheque book with his signatures to accommodate the said Mohanlal for running the business. The accused did not let in any evidence in support of his contention. The accused did not even examine himself as a witness in this case. He did not file any documents to prove the alleged joint real estate ventures of himself with Mohanlal. It is contended by the 1st respondent's Counsel that even though the accused did not lead any evidence, the complainant could not prove the alleged lending of ' 70,000/- to the accused. When there is statutory presumption under Section 139 of the Act to the effect that there is legally enforceable debt for the cheque, it is for the accused to lead evidence and to rebut the presumption contained under Section 139 of the Act.

In Hiten P. Dalal Vs. Bratindranath Banerjee, AIR 2001 SC 3897, the Supreme Court observed that Sections 138 and 139 of the Act introduced exceptions to the general rule as to the burden of proof in criminal cases and shifted the onus on the accused, in the following manner:

"Because both Sections 138 and 139 require that the Court "shall presume" the liability of the drawer of the cheques for the amounts for which the cheques are drawn, as noted in State of Madras Vs. A. Vaidyanatha Iyer, AIR 1958 SC 61, it is obligatory on the Court to raise this presumption in every case where the factual basis for the raising of the presumption had been established. "it introduced an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused" (ibid ). Such a presumption is a presumption of law, as distinguished from a presumption of fact which describes provisions by which the Court "may presume" a certain state of affairs. Presumptions are rules of evidence and do not conflict with the presumption of innocence, because by the latter all that is meant is that the prosecution is obliged to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumptions of law or fact unless the accused adduces evidence showing the reasonable possibility of the non-existence of the presumed fact."

In K. N. Beena Vs. Muniyappan, 2001(2) ALD (Crl.) 824 (S.C.), the Supreme Court observed that it would be erroneous approach in case the burden is cast on the prosecution/complainant to prove that the cheque was issued for a debt or liability. The Supreme Court further observed that the accused had to prove in the trial by leading cogent evidence that there was no debt or liability and that the accused not having led any evidence could not be said to have discharged the burden cast on him.

In Rangappa Vs. Mohan, AIR 2010 SC 1898, also the Supreme Court held that existence of legally recoverable debt or liability is a matter of presumption under Section 139 of the Act.

3. If the present case is scrutinised in the light of above decisions rendered by the Supreme Court, this Court has no hesitation to conclude that the accused/1st respondent made no attempt at all in leading evidence in order to rebut the presumption contained under Section 138 of the Act. The 1st respondent's counsel pointed out certain discrepancies in cross-examination of the complainant as P.W.1 with regard to date of lending money and with regard to date of obtaining money through chit for lending the same to the accused. When the complainant was being examined after four years of the lending, such discrepancies in dates do occur. The said errors in giving dates cannot be taken as a circumstance to rebut the presumption under Section139 of the Act. Therefore, this Court finds that Ex.P-1 cheque is supported by legally enforceable debt owed by the accused to the complainant.

4. It is contended by the 1st respondent's counsel that there is no compliance of statutory requirement by way of issuing notice to the accused after dishonour of cheque and calling upon the accused to pay amount covered by the cheque. The complainant as P.W.1 filed Ex.P-3 legal notice dated 16.09.2002 got issued by him to the accused. The notice was sent not only by registered post but also by courier service and also under certificate of posting which are evident from Exs.P-4 to P-6. Registered notice addressed to the accused was returned as per Ex.P-7 stating that the addressee left and new address is not known. I am of the opinion that there is valid compliance of the statutory requirement of issuing notice to the accused.

5. Since the cheque was drawn on State Bank of Hyderabad (ADB), Mahaboobnagar, it cannot be said that the Magistrate court at Mahaboobnagar has no jurisdiction to entertain the case.

6. On a reading of judgment of the lower court, it is evident that the Magistrate bungled and became confused because of simultaneous dealing of four cases filed by the accused and his family members simultaneously. The lower court should not have brought the material relating to other cases into the present case and should have confined to assessment of evidence let in the present case.

7. Thus, on reading and evaluation of the entire evidence on record, this Court finds that judgment of acquittal passed by the lower court is erroneous, perverse and is not sustainable both on facts and in law.

8. In the result, the criminal appeal is allowed setting aside acquittal recorded by the lower court and finding the accused/1st respondent guilty of offence under Section 138 of the Act. Accordingly, the accused/1st respondent is convicted for the offence under Section 138 of the Act and is sentenced to Simple Imprisonment for 6 months and pay fine of ' 5,000/-(Rupees five thousand only) apart from payment of compensation amount of ' 70,000/- (Rupees seventy thousand only) to the complainant/appellant. The lower court is directed to issue conviction warrant accordingly.

Appeal allowed.