2020 (10) TMI 905 - HC - Indian Laws

Dishonor of Cheque - offence under Section 138 of the Negotiable Instruments Act - rebuttal of presumption - HELD THAT - If the cheque was misused to the detriment of the accused with such huge financial implications, no man of ordinary prudence sits back without initiating any action against the complainant or the said Shamala Godi which was not done by the accused. This circumstance also weighed with the Courts below - Further, as admitted by the accused herself, she was involved in similar cheque bounce case as was evident by Ex.P-9 - the joint memo filed in Crl.Misc.No.93/2013 on the file of the II Additional J.M.F.C., Chikmagalur. These records show that accused was involved in the similar case on the allegation of borrowing loan from one Annapoorna issuing cheque and the cheque was dishonoured. Ex.P9 the joint memo shows that the accused settled the said matter for ₹ 1,00,000/- ultimately. Ex.P10 was the certified copy of the application filed by Annapoorna in Crl.Misc.No.93/2013 for recovery of compensation of ₹ 1,50,000/- in pursuance of the order passed in C.C.No.1630/2007 convicting the accused for the offence punishable under Section 138 of NI Act. The trial Court has rightly convicted and sentenced the accused and that was confirmed by the First Appellate Court. This Court finds no ground to admit the petition - Petition dismissed.

Summary

Issues:
Conviction and sentence under Section 138 of the Negotiable Instruments Act challenged in revision petition.

Analysis:
The revision petition challenges the conviction and sentence passed by the J.M.F.C-III Court, Davanagere, and confirmed by the I Additional District and Sessions Judge, Davanagere, against the petitioner under Section 138 of the Negotiable Instruments Act. The trial Court convicted the petitioner, sentencing her to pay a fine of ?2,50,000, with a default sentence of one year's simple imprisonment. Out of the fine, ?2,45,000 was to be paid to the complainant as compensation, and ?5,000 to the State. The petitioner, accused in the case, was alleged by the complainant to have borrowed ?2,25,000 in December 2005, issuing a cheque that was dishonored due to insufficient funds. The complainant served a notice to the accused, claiming repayment, which the accused failed to comply with, leading to the complaint under Section 138 of the NI Act.

The accused contested the case on various grounds, including denial of the loan transaction, misuse of the cheque, non-service of the notice, and issuance of the cheque not for discharging any liability to the complainant. Both the trial Court and the First Appellate Court held that the accused's admission of her signature on the cheque and the cheque belonging to her account led to the presumption under Section 139 of the NI Act that the cheque was issued to discharge a liability, which the accused failed to rebut. The Courts also found the notice served on the accused, dismissing the defense arguments of manipulation.

The defense argued discrepancies in dates and signatures, but the Courts found the evidence and legal position supporting the conviction and sentence. The accused's admission of the cheque ownership, coupled with lack of substantial evidence to rebut the presumption under Section 139, led to the conviction. The Courts rejected claims of non-service of notice and misuse of the cheque, emphasizing the accused's failure to take legal action if the cheque was indeed misused. The accused's involvement in a similar case further weakened her defense, leading to the dismissal of the revision petition and upholding of the conviction and sentence.

The legal precedent cited from APS Forex Services Pvt. Ltd. vs. Shakti International Fashion Linkers and Others AIR 2020 SC 945 supported the Courts' decision regarding the presumption arising from the accused's admission of the cheque and signature. The judgment emphasizes the accused's failure to rebut the presumption, leading to the confirmation of the conviction and sentence by the trial Court and the First Appellate Court. The revision petition was dismissed, and any fine amount deposited was to be transmitted to the trial Court.