Sunday, 13 December 2015

How to appreciate evidence in case of dishonour of cheque U/S 138 of NI Act?





Admittedly, the accused had replied to the legal notice sent by the complainant to her and in the said reply, the accused had specifically denied that she had received the amount of ` 4,39,424/- at any time in lump sum or in installments. It was stated in the reply that the complainant had approached the accused for financial assistance and the accused had told him that she does not have money now, but is likely to get the same by 25/08/2010 and, therefore, had issued the cheque to him bearing No. 299420 dated 31/08/2010 drawn on Corporation Bank, Panaji Branch for an amount of ` 2,67,424/-. In the reply, the accused further stated that she was not able to arrange for the money and she requested the complainant not to deposit the said cheque and to handover the said cheque back to her, but the complainant fraudulently deposited the said cheque. It was, therefore, made clear by the accused that the complainant had to establish that there was legally enforceable debt or other  liability. The case of the complainant was that the accused  required the money for construction of residential house i.e. for purchase of construction material. However, there is absolutely no evidence on record to prove that the accused was constructing any residential house or that she had paid any bills towards the purchase of construction materials. The complainant has not produced a single receipt or acknowledgment issued by the accused for having received any amount from the complainant. In his deposition, the complainant (AW1) stated that he paid the said amount by arranging from his Savings Bank Account and by borrowing some amount from friends. He even stated the name of one of the friends as Albert Norton. The complainant, however, did not produce passbook of his Savings Bank Account or any statement of account issued by the bank to prove that he had withdrawn any money from the Savings Bank Account. The complainant also did not examine said Mr. Albert Norton to prove that he had borrowed money from him to be given to the accused. In fact, AW1 stated that he is having the statement of Bank to show the withdrawal from 05/09/2009 to 10/06/2010, but he did not produce any such statement due to which the trial Court has rightly drawn adverse inference.
It is pertinent to note that neither in the complaint nor in the affidavit-in-evidence the complainant stated that the  accused had paid the amount of ` 1,72,000/- and, therefore, the balance amount was ` 2,67,424/-. It is true that in the cross-examination, a suggestion was put to AW1 that the accused had paid to him a sum of ` 1,25,000/- on 02/06/2010 in front of Federal Bank, Panaji in the presence of one Ganesh Rao. However, a perusal of the cross-examination reveals that this sum of ` 1,25,000/- has nothing to do with the alleged amount of ` 4,39,424/-. A specific suggestion has been put to AW1 that his statement that the said amount of ` 1,25,000/- was paid to AW1 by the accused out of ` 4,39,424/- is a false statement. In his cross-examination, AW1 has stated that the accused had paid some amount to him and balance amount was ` 2,67,424/-. If really, the accused had paid `1,25,000/- towards the part payment of the amount of ` 4,39,424/-, then, the balance would not be ` 2,67,424/-, but would be `3,14,424/-.
 In the circumstances above, the findings of the trial Court to the effect that the complainant failed to prove that he had advanced ` 4,39,424/- to the accused and that there was no legally enforceable debt is not erroneous. The finding of the trial Court that the accused rebutted the presumption available under the N. I. Act is also not erroneous.
Equivalent Citation: 2015ALLMR(Cri)1039, 2015(3)BomCR(Cri)656, 2015(6)MhLj91
IN THE HIGH COURT OF BOMBAY AT GOA
Criminal Appeal No. 19 of 2012
Decided On: 10.11.2014
Appellants: Gajanan Lobaji Kitturkar 
Vs.
Respondent: Sumati S. Bhandari
Hon'ble Judges/Coram:
U.V. Bakre, J.


1.Heard Mr. Mulgoankar, learned Counsel appearing on behalf of the appellant, Mr. Teles, learned Counsel appearing on behalf of the respondent no. 1 and Mrs. Pinto, learned CRIA19-12 2 Additional Public Prosecutor appearing on behalf of the respondent no. 2.
2. This appeal is directed against the judgment and order dated 31/10/2011 passed by the learned Judicial Magistrate, First Class, Panaji, Goa (trial Court, for short) in Criminal Case No. OA NIA 424/2010/C.
3. The appellant was the complainant and the respondent no. 1 was the accused in the said case. Parties shall, hereinafter, be referred to as per their status in the said Criminal Case.
4. The complainant had filed the complaint under Section 138 of the Negotiable Instruments Act, 1881 (N.I. Act, for short) which gave rise to the said Criminal Case No. OA NIA 424/2010/C.
5. Case of the complainant, in short, was as follows :
The complainant and the accused were working for New India Assurance Company Limited. The accused needed financial assistance as she was in the process of constructing her residential house and hence, requested the complainant, CRIA19-12 3 somewhere in the month of September, 2009, to advance money to her and assured that she will repay the same within a period of six months. The complainant believed the accused and, from time to time, arranged for money and paid the same to the accused to pay her bills and for required construction material. The total amount of ` 4,39,424/- was received by the accused from the complainant in various instalments roughly between 05/09/2009 and 10/06/2010. Towards the full and final settlement/payment of the total amount payable by the accused to the complainant, the accused issued to the complainant a cheque bearing no. 299420 dated 31/08/2010 drawn on the Corporation Bank, Panaji Branch for a sum of ` 2,67,424/-. The said cheque, when presented to the banker of the complainant, was returned dishonoured with endorsement "funds insufficient". The complainant addressed a demand notice to the accused through his Advocate as per law. The notice was received by the accused, who replied to the same through her Advocate thereby denying the liability and alleging that the complainant had himself approached her for financial assistance and in order to help him, she had issued the said cheque.
6. The accused pleaded not guilty to the substance of accusation explained to her. The complainant examined himself CRIA19-12 4 as AW1 and produced the cheque, the pay in slip, cheque return memo, postal slip, A.D. Card, the legal notice and the reply of the accused. The statement of the accused was recorded under Section 313 of Cr.P.C. The accused denied the case of the complainant and stated that the complainant had approached the accused for financial assistance and, therefore, the accused had issued the cheque bearing No. 299420 for ` 2,67,424/- to the complainant, but ultimately the accused could not make arrangement for the money and, therefore, she had requested the complainant not to deposit the said cheque and to give it back to her, but the accused misused the same. The accused did not examine any witness.
7. Upon consideration of the entire evidence on record, the learned trial Court found that the complainant failed to prove that there was any legally enforceable liability. The trial Court further held that the complainant failed to prove that he had advanced the said sum of ` 4,39,424/-. It held that the accused had rebutted the presumption available under the Act. The accused, therefore, came to be acquitted. The complainant is aggrieved by the acquittal and has filed the present appeal.
8. Mr. Mulgaonkar, learned Counsel for the complainant  submitted that no lump sum payment was made by the complainant to the accused and that the amounts were paid in various instalments and in such circumstances, Section 269-SS of the Income Tax Act was not applicable and, therefore, the learned trial Court erred in applying the said Section and disbelieving the case of the complainant on that count. He further submitted that the trial Court did not at all consider the impact of the presumption under Section 139 of the N. I. Act to ascertain whether the same was rebutted by the accused. He pointed out from the cross-examination of AW1 that there was a suggestion put to the complainant that he had received a sum of ` 1,25,000/- from the accused. According to the learned Counsel, this itself showed that there was a debt. Learned Counsel further submitted that the accused did not examine herself and that there was no cogent explanation regarding the cheque for ` 2,67,424/- given by the accused to the complainant. He, therefore, urged that the impugned judgment and order is perverse and, therefore, bound to be quashed and set aside and the accused ought to be convicted and sentenced for the offence under Section 138 of the N. I. Act.
9. On the other hand, Mr. Teles, learned Counsel for the accused read out certain paragraphs from the impugned  judgment and submitted that no glaring error has been shown by the complainant in the judgment of the trial Court and, therefore, this Court cannot interfere with the said judgment of acquittal which is based on correct appreciation of the evidence on record.
10. I have gone through the record and proceedings of the said Criminal Case No. OA NIA 424/2010/C and considered the arguments advanced by the learned Counsel for the parties.
11. There is no dispute that the accused had issued cheque dated 31/08/2010 for ` 2,67,424/- in favour of the complainant which was presented by the complainant to his banker within the validity period but the same was returned back for reason "funds insufficient". There is no dispute that the complainant, within the prescribed time, issued legal notice to the accused as required under section 138 of the N.I. Act but the accused failed to comply with the requirement thereof due to which the complainant filed complaint under Section 138 of the N.I. Act, within the prescribed time limit.
12. The only question which arises for determination is whether the trial court was justified in holding that the accused had discharged the burden of proving that the cheque was not issued in discharge of legally enforceable debt.
13. Though it is true that the learned trial Court has not specifically mentioned the provision of Section 139 of the N. I. Act which provides for the presumption in respect of a cheque, however, it is seen that the trial Court has specifically held that the accused has rebutted the presumption available under the Act which obviously is the presumption under Section 139 of the N. I. Act. Said Section 139 of the N. I. Act provides that it shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability. Thus, merely because a cheque has been issued, the same is not a conclusive proof of the fact that the same was issued for the discharge of any legally enforceable debt or other liability. The presumption under Section 139 of the N. I. Act is rebuttable. The learned Trial Court has relied upon the judgment of the Hon'ble Supreme Court in the case of Krishna Janardan Bhat Vs. Dattatraya G. Hegde, [MANU/SC/0503/2008 : (2008) 4 SCC 54], wherein it has been held that the prosecution must prove the guilt of the accused beyond all reasonable doubts whereas the standard of proof so as to prove the defence on the part of the  accused is preponderance of probability which can be drawn not only from the material brought on record by the parties, but also by reference to the circumstances upon which he relies. The accused can rebut the presumption by relying upon the material which has come on record in the cross-examination of the witness and he/she need not examine himself/herself.
14. Admittedly, the accused had replied to the legal notice sent by the complainant to her and in the said reply, the accused had specifically denied that she had received the amount of ` 4,39,424/- at any time in lump sum or in installments. It was stated in the reply that the complainant had approached the accused for financial assistance and the accused had told him that she does not have money now, but is likely to get the same by 25/08/2010 and, therefore, had issued the cheque to him bearing No. 299420 dated 31/08/2010 drawn on Corporation Bank, Panaji Branch for an amount of ` 2,67,424/-. In the reply, the accused further stated that she was not able to arrange for the money and she requested the complainant not to deposit the said cheque and to handover the said cheque back to her, but the complainant fraudulently deposited the said cheque. It was, therefore, made clear by the accused that the complainant had to establish that there was legally enforceable debt or other CRIA19-12 9 liability.
15. In the complaint, the complainant has specifically stated that an amount of ` 4,39,424/- was given by him to the accused and that the cheque for a sum of ` 2,67,424/- was given towards full and final settlement/payment of the total amount payable by the accused to the complainant. There is no whisper in the complaint as to how the payment towards full and final settlement was `2,67,424/- when the amount allegedly borrowed was ` 4,39,424/-. There is nothing in the complaint to show as to what happened to the balance amount of ` 1,72,000/-. In the affidavit-in-evidence also, the complainant (AW1) stated the same facts. However, a perusal of the legal notice dated 21/09/2010 given by the complainant to the accused through his Lawyer specifically states in paragraph 7 thereof that the said cheque bearing No. 299420 dated 31/08/2010 for sum of ` 2,67,424/- was given as the part payment of the total amount payable by the accused to the complainant. Therefore, there is material contradiction between the case of the complainant as pleaded in the complaint/affidavit-in-evidence and stated in the legal notice.
16. The case of the complainant was that the accused  required the money for construction of residential house i.e. for purchase of construction material. However, there is absolutely no evidence on record to prove that the accused was constructing any residential house or that she had paid any bills towards the purchase of construction materials. The complainant has not produced a single receipt or acknowledgment issued by the accused for having received any amount from the complainant. In his deposition, the complainant (AW1) stated that he paid the said amount by arranging from his Savings Bank Account and by borrowing some amount from friends. He even stated the name of one of the friends as Albert Norton. The complainant, however, did not produce passbook of his Savings Bank Account or any statement of account issued by the bank to prove that he had withdrawn any money from the Savings Bank Account. The complainant also did not examine said Mr. Albert Norton to prove that he had borrowed money from him to be given to the accused. In fact, AW1 stated that he is having the statement of Bank to show the withdrawal from 05/09/2009 to 10/06/2010, but he did not produce any such statement due to which the trial Court has rightly drawn adverse inference.
17. It is pertinent to note that neither in the complaint nor in the affidavit-in-evidence the complainant stated that the  accused had paid the amount of ` 1,72,000/- and, therefore, the balance amount was ` 2,67,424/-. It is true that in the cross-examination, a suggestion was put to AW1 that the accused had paid to him a sum of ` 1,25,000/- on 02/06/2010 in front of Federal Bank, Panaji in the presence of one Ganesh Rao. However, a perusal of the cross-examination reveals that this sum of ` 1,25,000/- has nothing to do with the alleged amount of ` 4,39,424/-. A specific suggestion has been put to AW1 that his statement that the said amount of ` 1,25,000/- was paid to AW1 by the accused out of ` 4,39,424/- is a false statement. In his cross-examination, AW1 has stated that the accused had paid some amount to him and balance amount was ` 2,67,424/-. If really, the accused had paid `1,25,000/- towards the part payment of the amount of ` 4,39,424/-, then, the balance would not be ` 2,67,424/-, but would be `3,14,424/-.
18. In the circumstances above, the findings of the trial Court to the effect that the complainant failed to prove that he had advanced ` 4,39,424/- to the accused and that there was no legally enforceable debt is not erroneous. The finding of the trial Court that the accused rebutted the presumption available under the N. I. Act is also not erroneous. No glaring error has been pointed out by the learned Counsel for the complainant in the CRIA19-12 12 impugned judgment and order. The impugned judgment cannot be termed as arbitrary or perverse. It is well settled that even if two views are possible out of which one is the view taken by the trial Court which is a possible view, the Appellate Court cannot interfere with the same and cannot substitute the same by its own view merely because that is also a probable view. The point for determination, therefore, gets answered in the affirmative. Hence, there is no merit in the present appeal.
19. In the result, the appeal is rejected.
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