2018 (9) TMI 840 - HC - Indian Laws

Dishonor of Cheque on the ground of exceeds arrangement - Section 138 of Negotiable Instruments Act - Held that - It is clear from the evidence that Dinesh Kumar did not discharge his loan liability, as he failed to pay the installments of the loan. It has also come on record that Dinesh Kumar knew that in case he fails to discharge his financial liability, then the same would be recovered from his father, who stood his guarantor. The accused signed the cheque and he has also not disputed the same. The accused has also admitted that he signed the acknowledgement, through which legal notice qua demand was issued to him. Thus, the above material is suffice to conclude that in order to extinguish the financial liability of Dinesh Kumar, the accused issued cheque amounting to ₹ 2,15,000/-. The next set of evidence establishes that the cheque issued by the accused was dishonoured on the ground of exceeds arrangement and despite issuance of notice he could not pay the cheque amount. In fact, after receipt of the notice, the accused did not do anything, thus his sleeping over the financial liability, in itself is a proof that he admitted his liability to pay the cheque amount. Issuance of cheque and admission of signature thereon would invoke presumption of legally enforceable debt in favour of holder and the accused needs to rebut such presumption. However, in the case in hand, the accused failed to rebut such presumption. Petition dismissed.

Summary

Issues:
1. Revision petition against judgment of conviction under Sections 397, 401, and 482 Cr.P.C.
2. Dispute regarding issuance of a cheque for loan repayment.
3. Interpretation of evidence and legal principles under Negotiable Instruments Act, 1881.

Issue 1:
The petitioner filed a revision petition against the judgment of conviction passed by the Sessions Judge, upholding the conviction by the Chief Judicial Magistrate. The petitioner argued that the evidence was not properly appreciated by the lower courts, and the respondent failed to prove the case against the accused.

Analysis:
The petitioner contested that the cheque was issued as a guarantee and not for loan repayment. However, the respondent argued that the cheque was for the payment of the loan amount. The courts examined the evidence, including the dishonored cheque and legal notices, to establish the liability of the accused. The petitioner's failure to pay after the notice was considered as an admission of liability.

Issue 2:
The core dispute revolved around the issuance of a cheque by the accused to settle the financial liability of his son's loan. The accused maintained that he was only a guarantor and not directly liable for the loan repayment.

Analysis:
Witnesses from the bank and the accused himself provided testimony regarding the purpose of the cheque and the financial arrangement. The accused's son confirmed the loan and the guarantor status of the accused. Despite the accused's denial of issuing the cheque, his signatures on the cheque and acknowledgment were admitted. The courts found that the accused issued the cheque to discharge the financial liability, as established by the evidence.

Issue 3:
The judgment delved into the legal principles under the Negotiable Instruments Act, 1881, specifically focusing on the dishonor of the cheque and the liability of the accused under Section 138 of the Act.

Analysis:
Referring to the Supreme Court's decision in Sampelly Satyanarayana Rao vs. Indian Renewable Energy Development Agency Limited, the court emphasized that the dishonor of a cheque for repayment of a loan installment falls under Section 138 of the Act. The court highlighted the presumption of a legally enforceable debt in favor of the holder of the cheque, which the accused failed to rebut in this case. The judgments of the lower courts were upheld based on the proper application of legal principles and the evidence presented.

In conclusion, the High Court of Himachal Pradesh dismissed the revision petition, affirming the judgments of the lower courts. The court found that the complainant bank had successfully proven the offense under Section 138 of the Negotiable Instruments Act, 1881 against the accused. The detailed analysis of the evidence and legal principles led to the dismissal of the petition, emphasizing the importance of honoring financial obligations and legal liabilities in such cases.