2022 (6) TMI 1209 - HC - Indian Laws

Dishonor of Cheque - acquittal of acused - presumption of innocence - prepoderance of probablities - scope of interference in acquittal appeals - Section 138 of NI Act - HELD THAT - It is well settled by catena of decisions that an appellate Court has full power to review, re-appreciate and consider the evidence upon which the order of acquittal is founded. However, the Appellate Court must bear in mind that in case of acquittal, there is prejudice in favour of the accused, firstly, the presumption of innocence is available to him under the fundamental principle of criminal jurisprudence that every person shall be presumed to be innocent unless he is proved guilty by a competent court of law. Secondly, the accused having secured his acquittal, the presumption of his innocence is further reaffirmed and strengthened by the trial Court. In the case under NI Act, the cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability. Further, explanation to this section defines the debt and other liability to mean a legally enforceable debt or other liability. In this context, after due appreciation and evaluation of the evidence on record, the learned trial Judge has come to a conclusion that the debt in question cannot be said to be legally enforceable debt and the complainant has failed to prove otherwise. It is observed by the learned trial Judge that in the case on hand, the complainant has not produced any documentary evidence to prove his legal debt from the accused and hence, it cannot be believed that the complainant had legal dues from the respondent accused. This Court has also gone through the documentary evidence as well as the depositions of the witnesses examined by the complainant to prove its case, however, a perusal of the depositions of the witnesses reveals not an iota of evidence suggesting about the amount of Rs.2,30,000/- was due to the complainant from the accused, except the fact that they had given their due amount (of loan instalments) to the respondent accused. Further, considering the material on record, it appears that the complainant has filed the complaint in question before the learned Magistrate under the provisions of Section 138 of the NI Act towards dishonour of cheque of Rs.45,000/-, the sum, which as per the case of the complainant company itself, was given to the respondent accused towards loan. A bare perusal of the complaint reveals that there is not single utterance as regards the other dues of the complainant and the complaint is filed only for the loan amount, which, admittedly was of Rs.45,000/- only - Besides, in the Loan Agreement Exh. 29 also, as per the learned trial Judge there are interpolation/corrections. Further, there found no seal and signature of the appellant company, except the signature of the respondent - accused in the said agreement, Exh. 29, which ought to have been there. The learned trial Judge has come to the conclusion that the debt cannot be said to be the legally enforceable debt, which is sine qua non in such matters and the complainant has failed to prove the same beyond reasonable doubt. The presumption Under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities. In the instant case, considering the evidence on record, it is observed by the learned trial Judge that the cheque in question appears to have been with the complainant prior to 14.04.1999 i.e. the date of post-card/letter written by the complainant to the respondent-accused - when the respondent-accused has succeeded in rebutting the presumption, the learned trial Judge has rightly come to the conclusion that the said provision would be of no help to the complainant. The complainant has failed to prove the case against the accused beyond reasonable doubt inasmuch as the ingredients of the offence alleged are not fulfilled. The Court has gone through in detail the impugned judgment and order and found that the learned trial Judge has meticulously considered the depositions of all the witnesses and came to such a conclusion and in the considered opinion of this Court, the learned trial Judge has rightly come to such a conclusion, which do not call for any interference at the hands of this Court. In the considered opinion of this Court, the complainant has failed to bring home the charge against accused for want of sufficient material. The findings recorded by the learned trial Judge do not call for any interference - Appeal dismissed.

Summary

Issues Involved:

1. Legally enforceable debt under Section 138 of the Negotiable Instruments Act, 1881.
2. Presumption under Sections 118(a) and 139 of the Negotiable Instruments Act, 1881.
3. Standard of proof for rebutting the presumption.
4. Evaluation of evidence and findings by the trial court.
5. Scope of interference by the appellate court in acquittal appeals.

Issue-wise Detailed Analysis:

1. Legally Enforceable Debt under Section 138 of the Negotiable Instruments Act, 1881:
The appellant, Bhumika Lease Finance Ltd., alleged that the respondent borrowed Rs. 45,000 and issued a cheque for Rs. 2,30,000, which was dishonored due to insufficient funds. The trial court concluded that the debt could not be considered legally enforceable. The court noted several discrepancies, including corrections in the loan agreement and lack of evidence to justify the increase in the outstanding amount to Rs. 2,30,000 within five months.

2. Presumption under Sections 118(a) and 139 of the Negotiable Instruments Act, 1881:
The trial court observed that the presumption under Section 139 is rebuttable and the onus is on the accused to raise a probable defense. The respondent successfully rebutted the presumption by showing that the amount mentioned in the cheque was not a legally enforceable debt. The court emphasized that the complainant failed to provide documentary evidence to prove the legal debt.

3. Standard of Proof for Rebutting the Presumption:
The standard of proof for rebutting the presumption is that of preponderance of probabilities. The respondent demonstrated that within five months, the loan amount could not have increased to Rs. 2,30,000. The trial court found that the complainant failed to prove that the cheque was issued for a legally enforceable debt, thus shifting the onus back to the complainant, who could not meet it.

4. Evaluation of Evidence and Findings by the Trial Court:
The trial court meticulously evaluated the evidence, including the loan agreement and witness depositions. It found discrepancies in the loan agreement and noted the absence of the appellant company's seal and signature. The court concluded that the complainant failed to prove the legal dues beyond reasonable doubt.

5. Scope of Interference by the Appellate Court in Acquittal Appeals:
The appellate court reiterated that it has full power to review and re-appreciate evidence but must bear in mind the presumption of innocence in favor of the accused. The court should not interfere with the trial court's findings unless they are perverse or manifestly illegal. In this case, the appellate court found no reason to disturb the trial court's findings, which were based on a thorough evaluation of evidence.

Conclusion:
The appeal was dismissed, and the trial court's judgment acquitting the accused was confirmed. The appellate court found that the complainant failed to prove the case beyond reasonable doubt and that the trial court's findings were justified and did not warrant interference.