2019 (1) TMI 2047 - HC - Indian Laws

Dishonour of Cheque - leading of evidence on affidavit - whether the accused of a complaint under Section 138 of the Negotiable Instruments Act is entitled to lead his evidence on affidavit? - HELD THAT - It is now well-recognized that Chapter XVII was introduced in the Act with a view to provide greater efficacy to the transactions undertaken on the basis of cheques and to instill confidence in the minds of the people in the commercial world with regard to the workability of the system of payments made by cheques. The transactions, wherein consideration passes through cheques cannot be lightly taken any longer by the drawers of the cheques, as the breach of such transactions as a result of the dishonour of the cheques issued by one of the parties, would result in penal consequences in certain situations. A reading of Chapter XVII of the Act also shows that the procedure prescribed has been made less cumbersome and more user friendly. Section 138 creates the offence where the drawer fails to make payment of the amount of money covered by the cheque to the payee or the holder in due course, as the case may be, within 15 days of the receipt of the notice of dishonour, and the dishonour is for specified reasons. Section 139 raises a rebuttable presumption that the holder of a cheque received the cheque for the discharge, in whole or in part, of any, debt or other liability, Section 143 makes applicable the procedure of summary trials as prescribed in the Code. It is clear that having regard to the Scheme of the Cr.P.C., the Legislature in its wisdom has left it open to the accused to exercise the option of examining himself as a witness for an offence punishable under Section 138 of the NI Act, in deliberately omitting any reference to the evidence of the accused by way of affidavit. For it would run against a first principle in criminal law namely, that an accused shall not be called as a witness except on his own request in writing. The evidence on behalf of the accused would include that of the accused, subject to Section 315 Cr.P.C. If the evidence of the witnesses could be by way of affidavit in terms of Section 145 NI Act, the evidence of the accused could also be way of affidavit. The impugned order passed by the 3rd Additional Civil Judge, Himmatnagar is quashed and set-aside. The application Exh. 128 filed by the applicant - accused is hereby allowed.

Summary

Issues Involved:
1. Legality and validity of the trial court's order rejecting the accused's application to submit evidence by affidavit.
2. Interpretation of Section 145 of the Negotiable Instruments Act regarding the accused's right to submit evidence by affidavit.

Summary:

Issue 1: Legality and Validity of the Trial Court's Order

By this application u/s Article 227 of the Constitution of India, the applicant - original accused calls in question the legality and validity of the order passed by the 3rd Additional Civil Judge, Himmatnagar, dated 27th March 2018 below application Exh. 128 in the Criminal Case No. 3145 of 2014. The trial court rejected the application Exh. 128 by placing strong reliance on the decision of the Supreme Court in the case of M/s. Mandvi Cooperative Bank Limited v. Nimesh B. Thakore, reported in (2010) 3 SCC 83.

Issue 2: Interpretation of Section 145 of the Negotiable Instruments Act

The main question was whether the accused in a complaint u/s 138 of the Negotiable Instruments Act is entitled to lead his evidence on affidavit. The Supreme Court's decision in M/s. Mandvi Cooperative Bank Limited v. Nimesh B. Thakore held that Section 145(1) confers a right on the complainant to give evidence on affidavit, but not on the accused. However, the applicant argued that the later decision of the Supreme Court in Indian Bank Association and others v. Union of India and others, reported in (2014) 5 SCC 590, allows the accused to lead evidence on affidavit.

Section 145 of the Act begins with "Notwithstanding anything contained in the Code...". This section is an exception to the normal rule that the complainant must give evidence in person. The purpose behind Section 145 is to expedite the disposal of complaints u/s 138 of the Act. Sub-section (2) indicates that there could be affidavit evidence of both witnesses for the complainant and the accused. The Karnataka High Court in Afzal Pasha v. Mohamed Ameerjan interpreted that the evidence of the accused could also be by way of affidavit, subject to Section 315 Cr.P.C.

In light of the above, the application was allowed. The impugned order passed by the 3rd Additional Civil Judge, Himmatnagar, below application Exh. 128 was quashed and set aside. The trial court was directed to permit the applicant - accused to tender his evidence including the evidence of his witnesses by way of affidavit, ensuring they are available for cross-examination when directed by the trial court.