2018 (10) TMI 1080 - HC - Indian Laws

Dishonor of Cheque - first appellate Court pointing the inconsistency in the defence version and failure to prove the cheque was stolen from her, dismissed her appeal drawing presumption under Section 139 of N.I. Act - Whether there is any error in the reasoning or finding of the Courts below? Held that - Under Section 118(a) of the N.I. Act, Court is obliged to presume, until the contrary is proved, that the initial burden in this regard lies on the defendant to prove the non-existence of consideration by bringing on record such facts and circumstances which would lead the Court to believe the non-existence of the consideration either by direct evidence or by preponderance of probabilities showing that the existence of consideration was improbable, doubtful or illegal. In the present case, the accused has not brought out any fact on record for the Court to believe there was no passing of consideration. The complainant and accused are not strangers. The accused in the cross examination of the complainant by way of suggestion, admits that she knew the complainant and he used to visit the share broker office next to her residence and he used to come to her house. At no point of time before trial or during trial, she has explained the possession of her signed cheque with the complainant. It is also not the case of the accused that the complainant is man of no means. An accused in cheque bounce case is not without any opportunity to discharge the burden of presumption. The opportunity shall be by either at the time of reply notice or through cross examination of the prosecution witnesses or through mounting the witness box or examining any other person in support of defence. The reverse burden can be discharged by raising bona-fide doubt in the mind of the Court regarding consideration or enforceable debt through all or any of the above said mode - In this case, the accused had not opted any of the above mode to shift the burden. Except suggesting to the complainant that he has stolen the cheque and without knowing the financial and family background, he could not have advanced a huge sum of ₹ 2,80,000/- . In the said circumstances of the fact and law, the finding of the Courts below does not fall under any of the category to interfere in revision. Taking note of the fact that the transaction is of the year 2008 and the accused being a woman, leniency is required balancing the interest of the complainant. The accused has been confined to prison for about 80 days pursuant to the Judgement - Therefore, no further sentence of imprisonment is required, instead, half of the cheque amount (Rs.1,40,000/-) is ordered as compensation payable to the complainant. Criminal Revision Case is partly allowed and the conviction passed by the Courts below are confirmed. However, the sentence imposed on the revision petitioner/accused is modified into period of sentence already undergone by the revision petitioner/ accused.

Summary

Issues:
1. Conviction under Section 138 of N.I. Act based on dishonored cheque
2. Defence of stolen cheque and lack of enforceable debt
3. Burden of proof on accused to rebut presumption under Section 139 of N.I. Act
4. Appeal against Trial Court judgment and dismissal by first appellate Court
5. Delay in filing revision petition and subsequent arrest of the accused
6. Modification of sentence and compensation to the complainant

Analysis:
1. The case involved the accused, who issued a cheque that was dishonored, leading to a complaint under Section 138 of the Negotiable Instruments Act. The complainant alleged lending a substantial amount to the accused, who failed to repay as per the cheque terms. The Trial Court convicted the accused, who then appealed to the Sessions Judge, raising doubts on the lending circumstances and the cheque's authenticity.

2. The accused's defense centered on the claim that the cheque was stolen and misused, casting doubt on the enforceable debt. However, the Trial Court rejected this defense, emphasizing the lack of evidence supporting the stolen cheque theory. The accused's failure to prove the non-existence of consideration or the theft of the cheque weakened her position.

3. The revision petitioner argued that the burden of proof to establish the accused's signature on the cheque rested with the complainant. Reference was made to the Supreme Court's judgment emphasizing that the accused need not testify to rebut the presumption under Section 139 of the N.I. Act. However, the Courts found the accused's contentions insufficient to counter the presumption.

4. The first appellate Court dismissed the accused's appeal, highlighting inconsistencies in her defense and failure to substantiate the stolen cheque claim. The Courts upheld the conviction, emphasizing the complainant's credible evidence and the accused's inability to disprove the existence of a debt.

5. The delay in filing the revision petition and subsequent arrest of the accused complicated the case, leading to considerations of leniency. The Court directed compensation payment by the accused to the complainant, taking into account the time already spent in prison and the subsequent developments.

6. Ultimately, the Court partially allowed the revision, confirming the conviction but modifying the sentence to time served. The accused was directed to pay compensation to the complainant, balancing the interests of both parties and concluding the legal proceedings effectively.