Whether accused in cheque dishonour case can be believed if he fails to seek return of cheque for period of seven years?

The Respondent contended that the signed blank Promissory Note was issued by him in favour of N.R.R. Finances Investments Pvt. Ltd. under a hire-purchase agreement for purchasing a lorry on loan basis. The said Promissory Note was not issued in favour of the Appellant-complainants. The Promissory Note was filled up by DW. 2 Mahesh, an employee of N.R.R. Investments, after the signatures of the Respondent were obtained on the same.

With respect to the two cheques which were dishonoured, the Respondent contended that these were amongst 10 blank cheques signed and handed over to the Appellant-K. Posa Nandhi as security, when he borrowed Rs. 5,00,000/- in 1995. That even though this loan was re-paid in 1996 with interest, the cheques were not returned. The Respondent further contended that he had issued a letter on 09.11.2002 asking the Appellants to return the 10 blank cheques.

3. The Trial Court found that the Respondent had admitted his signatures both on the Pronote and also on the two cheques for Rs. 37,00,000/- and Rs. 14,00,000/- respectively. The Respondent also admitted that the Appellant had invested capital in their concern viz. M/s. Maanihada Tea Factory.

The Court disbelieved the version of the Respondent with respect to the 10 blank cheques issued to the Appellant in 1995. The Respondent failed to place any material on record to show that he had ever asked for return of the 10 blank cheques, allegedly given by him to the Respondent, for seven years.

7. Mr. R. Basanth, Sr. Counsel appeared on behalf of the Respondent-Accused, and contended inter alia that the cheques were not issued towards discharge of a legally enforceable debt, but as a security, and that the judgment under challenge required no interference.

8. We have heard Senior Counsel for both parties, and perused the record. Under Section 139 of the N.I. Act, once a cheque has been signed and issued in favour of the holder, there is statutory presumption that it is issued in discharge of a legally enforceable debt or liability1. This presumption is a rebuttable one, if the issuer of the cheque is able to discharge the burden that it was issued for some other purpose like security for a loan.

In the present case, the Respondent has failed to produce any credible evidence to rebut the statutory presumption. This would be evident from the following circumstances:

(i) The Respondent-Accused issued a Pronote for the amount covered by the cheques, which clearly states that it was being issued for a loan;

(ii) The defence of the Respondent that he had allegedly issued 10 blank cheques in 1995 for repayment of a loan, has been disbelieved both by the Trial Court and Sessions Court, on the ground that the Respondent did not ask for return of the cheques for a period of seven years from 1995. This defence was obviously a cover-up, and lacked credibility, and hence was rightly discarded.

IN THE SUPREME COURT OF INDIA

Criminal Appeal Nos. 950-951 of 2018 

Decided On: 31.07.2018

T.P. Murugan Vs.  Bojan

Hon'ble Judges/Coram:

Rohinton Fali Nariman and Indu Malhotra, JJ.

Citation: 2019(2) MHLJ 948

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Whether burden of proof is on party to prove that revenue record is wrong if he alleges it?

The main ground urged is that since in the earlier proceedings held under the Act, the extent of pot kharab land was found to be 106.24 acres, then in the second ceiling proceedings the extent of pot kharab land could not come down to 28.20 acres. In this behalf, it is urged that the revenue authorities have relied upon the revenue entries with regard to the classification of the land and have not actually visited the land to determine which land is cultivable and which land is not cultivable. In ceiling proceedings, it is the duty of the owner of the land to show which portion of his land is exempt from ceiling proceedings. In this case, in the return filed on behalf of the owner it was mentioned that only 11.10 acres of land is pot kharab. However, on the basis of the revenue record, the officer assessed the pot kharab land as 28.20 acres. The Appellant led no evidence and has not even placed on record the revenue records prior to the earlier ceiling proceedings or the revenue record thereafter, to support his claim that even earlier the land which was declared to be pot kharab, was actually not classified as such in the revenue record. Presumption of truth is attached to the revenue record. No doubt, this is a rebuttable presumption, but it is for the party who alleges that the entries in the revenue record are wrong to lead evidences to rebut this presumption.

IN THE SUPREME COURT OF INDIA

Civil Appeal Nos. 2038-2039/2009

Decided On: 25.04.2018

 Vishwasrao Satwarao Naik Vs.  State of Maharashtra

Hon'ble Judges/Coram:

Madan B. Lokur and Deepak Gupta, JJ.

Citation: 2019(1) MHLJ 484

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Whether court should draw presumption U/S 139 of NI Act if execution of cheque is proved?

The learned counsel for the respondent admitted that execution of the 

cheque and also the signature found in the cheque.  Therefore, once execution 

of cheque is admitted, it is a legal presumption under Section 139 of 

Negotiable Instrument Act.  The cheque was issued for discharging legally 

enforceable debt.  No doubt the presumption is rebuttable. Though, admitted 

that the said cheque was issued for only security purpose and the respondent 

was only a working partner and he has not invested or contributed any money 

to the partnership firm.  Therefore, at the time of admitting him in the 

firm, the respondent had executed the cheque for the security purpose. 

7.Once issuance of  cheque is being admitted and even for security 

purpose, the presumption under Sections 118 and 139 of Negotiable Instrument 

Act and it is for the accused has to rebut the presumption there is no 

legally enforceable debt and cheque has not been issued for legally 

enforceable debt.  Therefore, the contention raised by the learned counsel 

for the respondent is not acceptable and the authorities submitted by the 

respondent is not applicable for present case in the hand.

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT

DATED: 19.01.2019

CORAM

 MR. JUSTICE P.VELMURUGAN

Crl.A.(MD).No.179 of 2008

A.K.Mohammed Farook    Vs. M.Syed Jaheer Hussain  

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What are necessary conditions for drawing presumption U/S 90 of Evidence Act?

 This Court in Paramesh Sarmah & Ors. Vs. Islamali & Ors. (supra), held in para-9 as under:

"9. The condition on which the execution of a document may presume for:-

'(1) That it must have been existed for 30 years or more; (2) It must be produced in court from proper custody. (3) The document must be in appearance free from suspicion and doubt; (4) It must be in a handwriting of a person and should not be anonymous. Generally there is no presumption about recitals in ancient document, but in special circumstances a recital of consideration, legal necessity, etc., may be presumed under S. 90...................."

23. In Bipin Ch. Kalita Vs. Sarama Kalita & Ors. (supra), this court in para-21 held as under:

"The gravamen of the authorities referred to above, is that the presumption comprehend in Section 90 of the Act, is relatable to the writings, execution and the attestation of the document, the contents thereof, being subject to proof in accordance with law. Unerringly, the approach of a court in the matter of presumption under Section 90 of the Act has to be essentially to effectuate the purpose thereof and not to render it nugatory. Though, a court is endowed with a discretion to draw a presumption as enumerated in the section, the exercise thereof, has to be informed with objectivity to further the legislative intendment. Unless, the attending facts and circumstances on the face of the document renders its existence, execution and attestation impossible, a rebuttable presumption is raised in favour of the genuineness and authenticity thereof, casting a burden on the other side to establish the contrary."

IN THE HIGH COURT OF GAUHATI

RSA 107/2014

Decided On: 18.07.2018

 Nepurjan Bibi Choudhury Vs. Musabbir Ali Choudhury and Ors.

Hon'ble Judges/Coram:

Mir Alfaz Ali, J.

Citation: AIR 2018 Gauhati 151

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Whether presumption of truth is attached to revenue record?

 The main ground urged is that since in the earlier proceedings held under the Act, the extent of pot kharab land was found to be 106.24 acres, then in the second ceiling proceedings the extent of pot kharab land could not come down to 28.20 acres. In this behalf, it is urged that the revenue authorities have relied upon the revenue entries with regard to the classification of the land and have not actually visited the land to determine which land is cultivable and which land is not cultivable. In ceiling proceedings, it is the duty of the owner of the land to show which portion of his land is exempt from ceiling proceedings. In this case, in the return filed on behalf of the owner it was mentioned that only 11.10 acres of land is pot kharab. However, on the basis of the revenue record, the officer assessed the pot kharab land as 28.20 acres. The Appellant led no evidence and has not even placed on record the revenue records prior to the earlier ceiling proceedings or the revenue record thereafter, to support his claim that even earlier the land which was declared to be pot kharab, was actually not classified as such in the revenue record. Presumption of truth is attached to the revenue record. No doubt, this is a rebuttable presumption, but it is for the party who alleges that the entries in the revenue record are wrong to lead evidences to rebut this presumption. This, the Appellants have miserably failed to do. The Appellants have also failed to lead any evidence to show that the revenue entries are wrong.

IN THE SUPREME COURT OF INDIA

Civil Appeal Nos. 2038-2039/2009

Decided On: 25.04.2018

Vishwasrao Satwarao Naik Vs. State of Maharashtra

Hon'ble Judges/Coram:

Madan B. Lokur and Deepak Gupta, JJ.

Citation:(2018) 6 SCC 580

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Whether lease deed signed by one party is valid?

A close reading of the third paragraph indicates that there is no stipulation that the instrument must be signed by both parties. The requirement is that when the lease is made by a registered instrument, "such instrument shall be executed by both the lessor and lessee." What is underlined in it is that the creation of a lease is not a unilateral exercise of one of the parties but a bilateral endeavour of both the lessor and the lessee.

11. The word "execute" is given the meaning in Black's Law Dictionary as "to complete; to make; to sign; to perform; to do; to follow out; to carry out according to its terms; to fulfil the command or purpose of." In "Words and Phrases" (Permanent Edition) the word "execute" is given the meaning as "to complete as a legal instrument; to perform what is required to give validity to." An instrument is usually executed through multifarious steps of different sequences. At the first instance, the parties might deliberate upon the terms and reach an agreement. Next the terms so agreed upon would be reduced to writing. Sometimes one party alone would affix the signature on it and deliver it to the other party. Sometimes both parties would affix their signature on the instrument. If the document is required by law to be registered, both parties can be involved in the process without perhaps obtaining the signatures of one of them. In all such instances the instrument can be said to have been executed by both parties thereto. If the instrument is signed by both parties it is presumptive of the fact that both of them have executed it, of course it is only rebuttable presumption. Similarly if an instrument is signed by only one party it does not mean that both parties have not executed it together. Whether both parties have executed the instrument will be a question of fact to be determined on evidence if such a determination is warranted from the pleadings of the particular suit. Merely because the document shows only the signature of one of the parties it is not enough to conclude that the non-signing party has not joined in the execution of the instrument.

IN THE SUPREME COURT OF INDIA

S.L.P. (C) No. 15042 of 1998

Decided On: 28.10.1998

 Rajendra Pratap Singh Vs.  Rameshwar Prasad

Hon'ble Judges/Coram:

Saiyed Saghir Ahmad and K.T. Thomas, JJ.

Citation:1998 (7) SCC 602

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