2021 (9) TMI 863 - HC - Indian Laws

Dishonor of Cheque - insufficiency of funds - acquittal of the accused - discharge of legally enforceable debt or not - rebuttal of presumption - Section 139 of N.I. Act - HELD THAT - It is to be noted here that, loan is said to have been advanced in 2009, but however, in the entire complaint there is absolutely no reference as to the date of advancement of loan for ₹ 2,00,000/-. It is hard to accept the contention that such a huge loan is being advanced and the complainant does not remember the date of advancement of loan. Even in the examination-in-chief P.W. 1 has not stated regarding date of advancement of loan. In the cross-examination, P.W. 1 has admitted that he has advanced the loan without obtaining any document. The evidence of P.W. 1 itself disclose that his monthly income is ₹ 5,000/- to ₹ 6,000/-. Further, in his cross-examination, he claimed he had withdrawn the amount from the bank and paid it to the accused. But to substantiate the said contention that he has bank account and was having balance of more than ₹ 2,00,000/- as on that particular date, no documents have been produced by the complainant - Admittedly, the accused is neither a friend nor relative of the complainant. Hence, the financial status of the complainant itself is in doubt and as such, the accused has created a dent in the case of the complainant. Considering these facts and circumstances, it is evident that the accused has rebutted the presumption available in favour of the complainant. Thereafter, the burden again shifts on the complainant to establish his financial status, but the complainant has not placed on record any document in this regard so as to prove financial status and to advance huge loan of ₹ 2,00,000/- to a person, who is not a close relative or close friend and without any security. Under these circumstances, looking to the facts, it is evident that the complainant has failed to establish the fact that Ex. P1 is issued in discharge of a legally enforceable debt. The learned Magistrate has considered all these aspects and appreciated oral and documentary evidence in detail. The judgment of acquittal passed by the learned Magistrate is neither perverse nor capricious so as to call for any interference by this court. Hence, the appeal is devoid of any merits and needs to be dismissed - Appeal dismissed.

Summary

Issues involved:
- Appeal against judgment of acquittal under Section 378(4) of Cr.P.C.
- Dispute over repayment of loan through a bounced cheque under Section 138 of Negotiable Instruments Act.
- Allegations of illegal and perverse judgment by the trial court.
- Examination of evidence, presumption under Section 139 of N.I. Act, and burden of proof.
- Financial capacity and credibility of the complainant in advancing a substantial loan without security.

Analysis:
1. The appellant filed a criminal appeal seeking to set aside the judgment of acquittal by the trial court under Section 378(4) of Cr.P.C. The case revolved around a loan transaction where the complainant alleged that the accused failed to repay a loan of ?2,00,000 resulting in a bounced cheque under Section 138 of the Negotiable Instruments Act.

2. The complainant advanced the loan to the accused, who issued a cheque that bounced due to insufficient funds. The trial court acquitted the accused based on the failure of the complainant to prove the cheque was issued in discharge of a legally enforceable debt. The appellant contended that the trial court erred in appreciating the evidence and failed to draw proper inferences.

3. The appellant argued that the trial court should have considered the presumption under Section 139 of the N.I. Act in favor of the complainant. However, the respondent denied the loan transaction and questioned the financial capacity of the complainant to lend such a substantial amount without proper security.

4. The court examined the evidence presented, including the cheque, and noted discrepancies in the complainant's testimony regarding the date of the loan advancement. The complainant's financial status was also questioned, as his income seemed insufficient to support the loan amount claimed. The defense produced a demand promissory note from 2005 to support their case.

5. The court found that the accused had successfully rebutted the presumption in favor of the complainant under Section 139 of the N.I. Act by presenting evidence of a previous loan transaction and financial discrepancies in the complainant's claims. The trial court's judgment of acquittal was deemed justified based on the evidence and lack of proof of a legally enforceable debt.

6. Ultimately, the court dismissed the criminal appeal, upholding the trial court's judgment of acquittal, as there was no basis for interference. The appeal lacked merit due to the failure to establish the cheque was issued in discharge of a legitimate debt, considering the financial inconsistencies and lack of supporting documentation presented by the complainant.