2018 (8) TMI 1293 - HC - Indian Laws

Dishonor of cheque due to insufficiency of funds - restoration of conviction passed by Learned Magistrate - it is the case of appellant that First Appellate Court, without considering the facts and circumstances, under wrong perception has reversed the conviction and acquitted the accused - Held that - It is seen from the records that only after the receipt of the letter Ex.D.1 issued by the accused, the complainant presented the cheque which was issued at the time of borrowing the loan as security purpose. Therefore, it is evident that the alleged cheque was not issued for any legal enforceable debt by the accused. That apart, even according to the complainant a sum of ₹ 2,00,000/- was borrowed by the accused for the interest at the rate of 24% per month. Hence, if the repayment amount is calculated with interest it comes to ₹ 6,00,000/-. But the accused issued cheque only for a sum of ₹ 2,00,000/-. As such the complainant has cleverly issued statutory notice as the cheque was issued only for part of the amount payable by the accused. Therefore, it has to be presumed that the cheque was not at all issued by the accused for any legal enforceable debt. This Court is of the considered opinion that the complainant did not fulfil the requirements as envisaged under Section 138 of Negotiable Instruments Act and it is clear that the complainant has failed to prove his case beyond any reasonable doubts - the lower appellate Court rightly acquitted the accused and reversed the judgment passed by the learned Magistrate, which does not warrant any interference from this Court. Appeal dismissed.

Summary

Issues:
1. Reversal of conviction under Section 138 of Negotiable Instruments Act by the appellate court.
2. Failure to prove legal enforceable debt through cheque issuance.
3. Application of legal principles from Supreme Court judgments.
4. Presumption of innocence and burden of proof in criminal cases.

Analysis:
1. The judgment involves an appeal against the reversal of conviction under Section 138 of the Negotiable Instruments Act by the appellate court. The complainant alleged that the accused borrowed a sum and issued a cheque for repayment, which was dishonored. The trial court convicted the accused, but the appellate court acquitted him, leading to the current appeal.

2. The key issue revolves around the failure to establish a legal enforceable debt through the issuance of the cheque. The accused denied the allegations, claiming the cheque was not intended for repayment. The court noted discrepancies in the evidence presented, including the amount borrowed and the amount covered by the cheque, leading to doubts about the existence of a valid debt.

3. The judgment extensively references legal principles from Supreme Court cases to analyze the matter. Citing Jugesh Sehgal v. Shamsher Singh Gogi and Krishna Janardhan Bhat v. Dattatraya G. Hegde, the court emphasized the essential elements required to prove an offense under Section 138 of the Act. It highlighted the need for fulfillment of specific conditions, including the issuance of the cheque for a legal debt and compliance with notice requirements.

4. The judgment delves into the presumption of innocence and the burden of proof in criminal cases. It underscores the importance of proving guilt beyond reasonable doubt for the prosecution and the standard of preponderance of probabilities for the defense. The court emphasized the need to consider all evidence and circumstances, including the accused's background and conduct, to prevent false implications and ensure a fair trial.

In conclusion, the High Court dismissed the criminal appeal, affirming the acquittal of the accused by the lower appellate court. The judgment underscores the importance of meeting the statutory requirements under Section 138 of the Negotiable Instruments Act and upholding the principles of presumption of innocence and burden of proof in criminal proceedings.