2019 (9) TMI 882 - HC - Indian Laws

Dishonor of Cheque - acquittal of accused - section 138 of NI Act - existence of debt or not - HELD THAT - The circumstances enable the accused to persuade the court to believe that he had not incurred any debt or liability to the complainant and that he had not issued the cheque to the complainant in discharge of any debt or liability. Thus, even if it is found that the specific plea set up by the accused as to the possession of his cheque by the complainant is not proved by him, he could succeed in rebutting the presumption under Section 139 of the Act by relying upon the facts and circumstances of the case set up by the complainant against him and also the facts and circumstances brought out in the evidence of the complainant. Then, in the absence of any reliable evidence adduced by the complainant to prove the transaction alleged by him, he has failed to prove that the accused committed an offence punishable under Section 138 of the Act. The judgment of the trial court acquitting the accused, does not warrant any interference by this Court in appeal - Appeal dismissed.

Summary

Issues Involved:
1. Execution and validity of the cheque.
2. Rebuttal of the presumption under Section 139 of the Negotiable Instruments Act.
3. Credibility of the complainant's evidence.
4. Defense of coercion and threat in signing the cheque.
5. Legal burden and standard of proof for the accused.

Detailed Analysis:

1. Execution and Validity of the Cheque:
The appellant (complainant) contended that the accused issued a cheque dated 20.04.2004 for ?2,00,000/- to discharge a legally enforceable debt. The cheque was dishonored due to a stop payment instruction by the drawer. The trial court found suspicious circumstances regarding the execution of the cheque, noting that the signature belonged to the accused but other entries were in different handwriting. The court emphasized that a person who signs a cheque remains liable under Section 138 of the Negotiable Instruments Act unless they rebut the presumption that the cheque was issued for payment of a debt or liability.

2. Rebuttal of the Presumption under Section 139 of the Act:
The court highlighted that the presumption under Section 139 is rebuttable. The accused can rebut this presumption by showing that the consideration and debt did not exist or were improbable. The accused's defense was that the cheque was signed under coercion and threat, and he did not owe any debt to the complainant. The court noted that the accused relied on the evidence of DW1 and documents Exts.D3 and D4 to support his claim.

3. Credibility of the Complainant's Evidence:
The court scrutinized the complainant's evidence and found it lacking in credibility. The complaint and statutory notice did not detail the nature of the debt or liability. The complainant did not disclose the transaction details in the complaint or in his examination-in-chief, only doing so during cross-examination. The court found this omission significant, especially since the complainant was aware of the accused's defense.

4. Defense of Coercion and Threat in Signing the Cheque:
The accused claimed that the complainant and his partner forcibly took his cheque book and compelled him to sign two cheque leaves. DW1, an employee of the accused, corroborated this claim, stating that the incident occurred in January 2004. The court found DW1's testimony credible, noting that it was not effectively challenged during cross-examination. The accused also filed complaints with the police (Exts.D3 and D4) regarding the incident, which the court considered as supporting evidence despite the delay in filing.

5. Legal Burden and Standard of Proof for the Accused:
The court reiterated that the accused is not required to prove his defense beyond a reasonable doubt but must bring forth evidence to rebut the presumption under Section 139. The court found that the accused successfully rebutted the presumption by relying on the complainant's case and evidence. The court emphasized that the accused's failure to testify cannot be used against him, as per Section 315(1) of the Code of Criminal Procedure and Article 20(3) of the Constitution of India.

Conclusion:
The court concluded that the accused rebutted the presumption under Section 139 by demonstrating that the complainant's case lacked credibility and by providing evidence of coercion. The complainant failed to prove the existence of a legally enforceable debt or liability. Consequently, the trial court's judgment acquitting the accused was upheld, and the appeal was dismissed.