2020 (2) TMI 1403 - HC - Indian Laws

Dishonor of Cheque - main and pivotal contention of the petitioner is that the account stood closed even in the year 2001 and, therefore, the cheque, alleged to have been issued by the petitioner, itself is highly questionable - HELD THAT - In the case on hand, non-following of the procedure has crucially impacted the case of the respondent for the reason that a defence has been raised by the petitioner stating that the whole business had been sold to one Umapathy, whose friend, Kalisamy, is the friend of the respondent and who had paved the way for the cheque reaching the hands of the respondent. When such a defence has been taken by the petitioner, it is incumbent on the court below to have subjected the cheque to expert opinion, which would have conclusively proved the case either way. Neither the respondent nor the courts below thought it fit to subject the cheque to expert opinion. In the case on hand, it cannot be brushed aside that no defence has been taken by the petitioner with regard to the cheque in question. A defence has been taken, which has not been shown to be a illusory defence by the complainant. Therefore, applying the test of preponderance of probabilities, this Court is of the considered opinion that definitely there exists a rebuttal by the petitioner with regard to the materials placed by the complainant and in such a scenario, prudence should have been exercised by subjecting the cheque to expert opinion so as to authenticate the signature on the cheque. There is no dispute that a case u/s 138 of the Negotiable Instruments Act was pursued against the petitioner's husband, which ultimately ended in acquittal and the same has attained finality as no appeal/revision has been filed against the said order. That being the case, the amount, which is the subject matter of the present case, having been accounted for in the parallel proceedings against the petitioner's husband, and the further fact that the same judicial officer has conducted the appellate proceedings and rendered a finding in the said case, this Court is at a loss to understand as to what stood in the way of the lower appellate court to record a different finding on the same set of facts. However, this Court is not amplifying any further on the said issue, except to hold that the findings recorded in the parallel proceedings ought to have been taken into consideration while deciding the issue in the present case. In the case on hand, the accused has raised a defence by rebutting the evidence placed by the complainant and has further pleaded for sending the disputed cheque for expert opinion, which has been rejected. In such circumstances, it is not necessary for the defence/petitioner to either place documentary or oral evidence before the court to establish his case, but suffice if a doubt is created in the complainant's case about the existence of a legally enforceable debt or liability, which the petitioner, in the present case, has successfully established. In such a backdrop of the factual materials available on record, this Court is of the considered view that the findings recorded by the trial court, as found favour with by the lower appellate court, are not based on correct interpretation of the proposition of law and, therefore, this Court has no hesitation to differ with the conclusion arrived at by the courts below. Revision petition is allowed.

Summary

Issues Involved:
1. Validity of the cheque issued by the petitioner.
2. Burden of proof and standard of evidence required.
3. Relevance of prior judicial findings in a parallel case.

Issue-wise Detailed Analysis:

1. Validity of the Cheque Issued by the Petitioner:
The petitioner argued that the account from which the cheque was issued had been closed in 2001, making the cheque itself questionable. The lower appellate court failed to send the cheque for expert opinion to verify the signature, despite the petitioner's request. This non-following of procedure significantly impacted the case, as the cheque's authenticity was central to the dispute. The court noted that the respondent did not call for particulars from the bank regarding the surrender of cheque leaves when the account was closed. This omission weakened the respondent's case, as it was critical to establish the link between the cheque and the petitioner.

2. Burden of Proof and Standard of Evidence Required:
The petitioner contended that the lower courts erroneously shifted the burden of proof onto the petitioner, instead of requiring the complainant to prove the case beyond a reasonable doubt. The Supreme Court's ruling in Laxmi Dyechem v. State of Gujarat was cited, emphasizing that under Sections 138 and 139 of the Negotiable Instruments Act, the accused needs only to establish a probable defense to create doubt about the existence of a legally enforceable debt. The court found that the petitioner had successfully raised such a defense, and the complainant failed to conclusively prove the case. The court highlighted that the absence of the petitioner to prove his case should not be detrimental if the complainant's case itself is doubtful.

3. Relevance of Prior Judicial Findings in a Parallel Case:
The petitioner highlighted a parallel case where the complainant had initiated proceedings against the petitioner's husband for a similar loan amount, which ended in acquittal. The court noted that the same judicial officer had conducted the appellate proceedings in both cases. The acquittal in the husband's case, which accounted for the amount in question, should have influenced the decision in the present case. The court criticized the lower appellate court for not considering the findings from the parallel proceedings, which could have impacted the outcome of the current case.

Conclusion:
The court concluded that the findings of the lower courts were not based on a correct interpretation of the law. The petitioner had successfully raised a defense that created doubt about the existence of a legally enforceable debt. The failure to send the cheque for expert opinion and the omission to consider the parallel case's findings were significant errors. Consequently, the criminal revision petition was allowed, and the judgments of the lower courts were set aside.