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2022 (8) TMI 1303 - SC - Indian LawsDishonor of Cheque - acquittal of accused - rebuttal of statutory presumption - discharge of burden to prove - section 138 and 139 of NI Act - HELD THAT - By the impugned common judgment and order, the High Court has reversed the concurrent findings recorded by both the courts below and has acquitted the accused on the ground that, in the complaint, the Complainant has not specifically stated the nature of transactions and the source of fund. However, the High Court has failed to note the presumption under Section 139 of the N.I. Act. As per Section 139 of the N.I. Act, 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 discharge, in whole or in part, of any debt or other liability. Therefore, once the initial burden is discharged by the Complainant that the cheque was issued by the accused and the signature and the issuance of the cheque is not disputed by the accused, in that case, the onus will shift upon the accused to prove the contrary that the cheque was not for any debt or other liability. The presumption under Section 139 of the N.I. Act is a statutory presumption and thereafter, once it is presumed that the cheque is issued in whole or in part of any debt or other liability which is in favour of the Complainant/holder of the cheque, in that case, it is for the accused to prove the contrary. The aforesaid has not been dealt with and considered by the High Court. The High Court has also failed to appreciate that the High Court was exercising the revisional jurisdiction and there were concurrent findings of fact recorded by the courts below. The impugned judgment and order passed by the High Court acquitting the accused for the offence punishable under Section 138 of the N.I. Act is hereby quashed and set aside and the order passed by the learned trial Court convicting the accused for the offence punishable under Section 138of the N.I. Act confirmed/modified by the learned Sessions Court is hereby restored - Appeal allowed.
Issues:
Appeal against acquittal under Section 138 of the Negotiable Instruments Act, 1881 based on failure to consider statutory presumption under Section 139 of the Act. Detailed Analysis: 1. Background: The case involves an appeal against the acquittal of the accused under Section 138 of the Negotiable Instruments Act, 1881. The High Court acquitted the accused based on the complainant's failure to specifically state the nature of transactions and the source of funds. 2. Trial Court's Decision: The trial court had convicted the accused under Section 138 of the Act, sentencing them to three months of simple imprisonment and a fine of Rs. 5,00,000. The court also ordered that the fine amount, if realized, be given to the complainant as compensation. 3. Appellate Court's Decision: The appellate court confirmed the conviction but modified the sentence due to the accused's old age. The accused was ordered to undergo imprisonment till the rising of the court, pay a fine of Rs. 5,00,000, and the fine amount, if realized, be given to the complainant as compensation. 4. High Court's Decision: The High Court, in the revision applications filed by the accused, reversed the lower courts' findings and acquitted the accused. The High Court failed to consider the statutory presumption under Section 139 of the Act, which shifts the burden of proof to the accused once the complainant establishes certain facts. 5. Supreme Court's Ruling: The Supreme Court set aside the High Court's judgment, stating that the High Court failed to consider the statutory presumption under Section 139. The Court emphasized that once the complainant proves certain elements, the burden shifts to the accused to prove otherwise. The Court reinstated the trial court's order, directing the accused to be dealt with as per the appellate court's decision. 6. Conclusion: The Supreme Court allowed the appeals, quashed the High Court's judgment, and granted the accused two months to pay the fine as ordered by the appellate court. The Court reiterated the importance of the statutory presumption under Section 139 in cases under Section 138 of the Negotiable Instruments Act, 1881.
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