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2021 (1) TMI 306 - HC - Indian LawsDishonor of Cheque - acquittal of the accused - main contention of the complainant in this appeal is that the Trial Judge failed to consider the evidence of PWs.1 and 2 and also the principles laid down in the judgments referred in the grounds of appeal and also failed to take note of accused Nos.1 and 2 have not entered into the witness box to rebut the evidence of the complainant - HELD THAT - This Court has to re-appreciate the material available on record. The present appeal is filed against the order of acquittal. This Court has to re-appreciate the material on record and arrive for a conclusion whether the trial Judge has considered the material available on record or not. This Court also given anxious consideration to the principles laid down in the Judgments referred supra both by Complainant's Counsel and accused Counsel. In keeping the principles and also considering the material available on record, this Court has to examine whether the Trial Court Judgment is perverse and not based on the material available on record. It is important to note that based on the complaint, it is the case of the complainant that the accused had raised two invoices for supply of 6000 MTs for shipment of the business transaction and these two invoices are not in existence as admitted by P.W.1 in the cross-examination. However, the complainant relied upon the documents-Exs.P8 to P10. But in the cross-examination, it is categorically admitted that Exs.P8 to P10 bears the date prior to the subject matter of the cheque and also there is contrary evidence as against the contents of the complaint and in the complaint, it is in respect of 6000 MTs. and in the affidavit it is mentioned as 25000 MTs. It is also categorically admitted that Ex.P10 is only a Proforma Sale Invoice. It is also important to note that though P.W.2-R.Kannan was examined and claims that he is having the personal knowledge and giving evidence based on the records. He denies the initiation of other three complaints before the Court. Even he had gone to the extent of denying the three complaints filed against these accused persons at Delhi, so also initiation of arbitration proceedings. It is also important to note that Ex.P10, which has been relied upon by the complainant is only a Proforma Sale Invoice and legal notice claim is in respect of two invoices for about 6000 MTs, but documents produced before this Court as Exs.P8 to P10 are contrary to the complaint averments as well as the legal notice. Hence, it is clear that Ex.P8 is in respect of 25000 MTs. of iron ore and claim is to the tune of ₹ 2,50,00,000/-. The complainant has changed his version while leading the evidence through the witness P.W.2-Kannan. The complainant being the Central Government Undertaking ought to have produced the documents with regard to the transaction, which had taken place between the complainant and the accused. It is also important to note that in the cross- examination, P.W.2-Kannan was cross-examined suggesting that in terms of MOU, it is agreed to transact only to the tune of ₹ 14.82 Crores. But the accused already made the payments more than ₹ 20 Crores and witness says he is not aware of the same. Hence, it is clear that the witness - P.W.1 is not aware of the transaction taken place between the complainant and the accused. It is also important to note that Exs.C1 to C3 are got marked as Court documents. The complainant does not deny the same. The complainant is not sure about whether it is for the supply of 6000 MTs. iron ore or towards supply of 25000 MTs. iron ore and also the invoices which have been pleaded in paragraph No.2 of the complaint have not been placed before the Court. It is also important to note that, P.W.2, who has been examined subsequently, is not aware of the transaction between the complainant and the accused in toto and he is not aware of any proceedings initiated by the accused in Delhi as well as in Bengaluru. It is also pertinent to note that the complainant being a Central Government Undertaking has not maintained any account with regard to the transaction and produced the same before the Court. There must be a proof with regard to ascertaining the liability of the accused. In the absence of said statement of account before the Court, the Court cannot come to the conclusion that the cheques are issued towards the debt or liability. It is also important to note that P.W.2 categorically admits that Ex.P10 was only a Proforma Sale Invoice was raised. When such being the case, in the absence of relevant documents before the Court, the Court cannot come to a conclusion that the said cheques are issued in discharge of liability. No doubt, it is settled principle that once the cheque is admitted and not denied the signature; the Court has to draw the presumption. In the case on hand, the accused had rebutted the case of the complainant and even after rebutting the evidence of the complainant, even though, the burden shifts on him but further fails to prove the case of the complainant. The Complainant did not choose to place the material before the Court either the invoices or the statement of accounts. When such being the case, the accused are rebutted the case of the complainant. There are no error committed by the Trial Court in appreciating both oral and documentary evidence and rightly come to the conclusion that the complainant has failed to prove its case. This Court can only reverse the finding of the Trial Court if the findings of the Trial Court is perverse and the material evidence is not considered then to exercise its appellate jurisdiction to reverse the findings and there is no error committed by the Trial Court in appreciating the case of the complainant. Hence, it is not a fit case to reverse the findings of the Trial Court. Appeal dismissed.
Issues Involved:
1. Whether the Trial Court erred in acquitting the accused under Section 138 of the Negotiable Instruments Act (N.I. Act). Issue-wise Detailed Analysis: 1. Trial Court's Consideration of Evidence: The appellant contended that the Trial Judge failed to consider the evidence of P.W.1 and P.W.2 and the principles laid down in relevant judgments. The Trial Court was criticized for relying on complaints in arbitration and criminal proceedings in Delhi, which were unrelated to the cheque in question. The complainant argued that the Trial Judge erroneously held that the complainant owed money to the accused based on a cheque issued for other transactions under the MOU dated 10.03.2004. The Trial Judge also failed to appreciate the evidence of P.W.2 properly. 2. MOU and Financial Transactions: The complainant highlighted the MOU dated 10.03.2004, which stipulated that the complainant would fund 80% of the iron ore procurement cost, while the accused would pay the remaining 20%. The MOU included clauses allowing the complainant to recover losses from the accused in case of a breach. The accused issued a cheque for ?2.5 Crores, which was dishonored due to insufficient funds. Despite legal notice, the accused did not comply, leading to the complaint. 3. Burden of Proof and Presumption under Section 139 of the N.I. Act: The complainant argued that the Trial Judge erred in shifting the burden of proof to the complainant instead of drawing the presumption under Section 139 of the N.I. Act, which mandates that the cheque was issued for a legally enforceable debt. The accused did not provide any evidence to substantiate their defense that the cheque was given as security, not for liability. 4. Evidence and Documentary Proof: The complainant examined P.W.1 and P.W.2 and presented various documents. However, P.W.1's evidence was discarded as he was not available for cross-examination, leaving only P.W.2's testimony. P.W.2's evidence was based on personal knowledge and documents, but he admitted discrepancies and lack of direct knowledge about the transactions. The accused relied on documents Exs.C.1 to C.3, which included account extracts showing payments exceeding ?30 Crores to the complainant. 5. Contradictions and Lack of Documentary Support: The Trial Court noted contradictions in the complainant's evidence, particularly between the affidavits of P.W.1 and P.W.2. The complainant failed to produce the invoices mentioned in the complaint and relied on documents introduced later, which were inconsistent with the complaint's averments. P.W.2 admitted that the documents Exs.P.8 to P.10 were dated before the disputed cheque and that Ex.P.10 was only a Proforma Sale Invoice. 6. Rebuttal of Presumption and Defense Evidence: The accused effectively rebutted the complainant's case by highlighting the inconsistencies and lack of documentary proof. Despite the presumption under Section 139 of the N.I. Act, the accused demonstrated that the complainant's evidence was insufficient to establish the existence of a debt or liability. The Trial Court found that the complainant did not prove its case beyond a reasonable doubt. Conclusion: The High Court upheld the Trial Court's judgment, concluding that the complainant failed to substantiate its claims with credible evidence. The Trial Court's findings were not perverse or unsupported by the material on record, and thus, there was no basis to reverse the acquittal. The appeal was dismissed.
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