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2018 (3) TMI 1968 - HC - Indian Laws


Issues Involved:
1. Whether the Appellate Court committed any error or illegality which would warrant interference or the view taken by the Appellate Court is a possible view and hence, in appellate jurisdiction deserves no interference?
2. Whether the appellant-original complainant succeeded in proving the initial burden of existence of legally enforceable debt?
3. Whether the amendment made in law in the year 2003 would have applicability to the case of the appellant so far as enhancement of punishment is concerned?
4. Whether the appellant has made out the case to allow him the compensation under the N.I. Act?

Issue-wise Detailed Analysis:

1. Power of Appellate Court (Issue No.1):
The High Court emphasized that the Appellate Court should not interfere with the findings of the trial court if the view taken by the Appellate Court is a possible view based on the evidence. The Apex Court in C. Antony Versus K.G. Raghavan Nair held that even if another view is possible from the same evidence, it is not a ground for the Appellate Court to interfere.

2. Legally enforceable debt, whether proved (Issue No.2):
The High Court cited the case of Rangappa Versus Sri Mohan, which established that the presumption mandated by Section 139 of the NI Act includes the existence of a legally enforceable debt or liability. This presumption is rebuttable, and the burden shifts to the accused to contest the liability. The complainant provided detailed evidence showing the advancement of Rs.36 lakh to the respondent, the issuance of a promissory note, and the subsequent dishonor of the cheque due to insufficient funds. The complainant's oral and documentary evidence, including the details of relatives from whom the amount was collected, established the existence of a legally enforceable debt. The respondent failed to rebut this presumption effectively.

3. Applicability of 2003 Amendment (Issue No.3):
The amendment increasing the punishment under Section 138 of the NI Act to two years came into effect on 06.02.2003. Since the transaction and the complaint were from 2002, the maximum punishment applicable was one year. The High Court modified the sentence accordingly, sentencing the respondent to one year of simple imprisonment and a fine of Rs.72 lakh, with Rs.71 lakh to be paid as compensation to the complainant and Rs.1 lakh to the State exchequer.

4. Compensation under the N.I. Act (Issue No.4):
The High Court concluded that the complainant had reasonably discharged the burden of proving the existence of a legally enforceable debt. The respondent's failure to reply to the notice of demand and the absence of any complaint about the cheque being stolen further supported the complainant's case. The High Court upheld the trial court's decision to award compensation to the complainant, modifying the amount to Rs.71 lakh.

Conclusion:
The High Court allowed the appeal, quashing and setting aside the judgment of the Appellate Court. The respondent was sentenced to one year of simple imprisonment and ordered to pay Rs.72 lakh, with Rs.71 lakh as compensation to the complainant. The respondent was given four weeks to deposit the amount, failing which a non-bailable warrant would be issued for his arrest. The judgment and order of the Chief Metropolitan Magistrate were modified to this extent.

 

 

 

 

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