2013 (8) TMI 1184 - HC - Indian Laws

Summary

Issues Involved:
1. Whether the petitioner proved the consideration for the cheque issued by the respondent.
2. Whether the respondent successfully rebutted the presumption u/s 118(a) and 139 of the Negotiable Instruments Act.
3. Whether the appellate court erred in overturning the trial court's conviction.

Summary:

Issue 1: Consideration for the Cheque
The petitioner claimed to have advanced a loan of ` 72,000/- to the respondent in December 2001, with the respondent issuing a cheque dated 4.1.2002 for repayment. The cheque was dishonored due to insufficient funds. The petitioner issued a legal notice on 26.3.2002, which the respondent replied to, claiming the cheque was stolen and payment was stopped. The trial court convicted the respondent u/s 138 of the Negotiable Instruments Act, awarding simple imprisonment and compensation. However, the appellate court found that the petitioner failed to prove the consideration for the cheque, noting the absence of evidence for the sources of the loan amount.

Issue 2: Rebuttal of Presumption
The appellate court observed that the respondent had issued stop payment instructions to his bank prior to the cheque's dishonor date. The bank clerk's testimony confirmed sufficient funds were available, and the cheque was returned due to stop payment instructions, not insufficient funds. The respondent's defense included a police report for the stolen cheque and letters to the bank, which were not adequately countered by the petitioner. The appellate court concluded that the respondent successfully rebutted the presumption u/s 118(a) and 139 of the Negotiable Instruments Act by showing a probable defense.

Issue 3: Appellate Court's Decision
The appellate court's decision to overturn the trial court's conviction was based on the petitioner's failure to prove his financial capacity to lend ` 72,000/-. The petitioner could not substantiate his claim with bank records or other evidence. The appellate court found the respondent's defense plausible and noted the petitioner's inability to prove his case beyond reasonable doubt. The High Court concurred with the appellate court's logical appreciation of evidence, dismissing the petition for leave to appeal, citing no illegality or misappreciation of facts in the appellate court's judgment.