2022 (11) TMI 490 - HC - Indian Laws

Dishonor of Cheque - insufficient funds - discharge of initial burden to prove - rebuttal of presumptions - preponderance of probabilities - HELD THAT - After questioning the accused under Section 313(1)(b) of Cr.P.C, though opportunity was provided to the accused to adduce defence evidence, no defence evidence was adduced - It is the settled law that, when the complainant discharged his initial burden in the matter of transaction led to execution of the cheque, he would get twin presumptions in his favour. Law regarding presumptions is also settled as well. The law is clear on the point that when the complainant discharged the initial burden to prove the transaction led to execution of the cheque, the presumption under Sections 118 and 139 of the N.I Act would come into play. No doubt, these presumptions are rebuttable and it is the duty of the accused to rebut the presumptions and the standard of proof of rebuttal is nothing but preponderance of probabilities - Coming to the power of this Court in the matter of exercising revision, the law is well settled. It is the settled law that power of revision available to this Court under Section 401 of Cr.P.C r/w Section 397 is not wide and exhaustive to re-appreciate the evidence to have a contra finding. It is to be noted that nothing available to interfere with the concurrent verdicts, by exercising power of revision. To the contrary, it appears that the courts below rightly entered into conviction and sentence - revision petition dismissed.

Issues Involved:
1. Validity of the cheque issued as a blank signed cheque towards security.
2. Liability of the guarantor when the principal borrower has not defaulted.
3. Presumptions under Sections 118 and 139 of the Negotiable Instruments Act.
4. Scope of revisional jurisdiction under Sections 397 and 401 of the Code of Criminal Procedure.

Issue-wise Detailed Analysis:

1. Validity of the Cheque Issued as a Blank Signed Cheque Towards Security:
The accused argued that the cheque in question was issued as a blank signed cheque towards security and not for any consideration. The trial court and the appellate court both examined and re-appreciated the evidence, ultimately rejecting this contention. The courts emphasized the evidence provided by PW1 and concluded that the transaction leading to the execution of the cheque was proven. The courts relied on the fact that the accused admitted to issuing the cheque as a guarantor but failed to prove that it was issued as a blank signed cheque towards security.

2. Liability of the Guarantor When the Principal Borrower Has Not Defaulted:
The accused contended that since the complainant did not allege that the principal borrower failed to repay the loan, the guarantor had no liability. The court found this argument unsustainable, noting that in cases involving debt with a principal debtor and guarantor, the liability is joint or several. Therefore, either the principal debtor or the guarantor can be legally proceeded against. The complainant's specific case was that the principal debtor failed to pay the amount, and the guarantor issued the cheque to discharge this liability.

3. Presumptions Under Sections 118 and 139 of the Negotiable Instruments Act:
The court referred to several Supreme Court decisions to elucidate the legal presumptions under Sections 118 and 139 of the NI Act. It cited the case of Rangappa v. Sri. Mohan, which established that the presumption under Section 139 includes the existence of a legally enforceable debt or liability. This presumption is rebuttable, and the accused can contest it by raising a probable defense. The court also referenced Bir Singh v. Mukesh Kumar, which held that a signed blank cheque handed over voluntarily attracts the presumption under Section 139 unless rebutted with cogent evidence. The latest decision in M/s. Kalamani Tex & Anr. v. P. Balasubramanian reiterated that even a blank cheque leaf handed over voluntarily would attract the presumption under Section 139. The court concluded that the complainant had discharged the initial burden of proof, and the accused failed to rebut the presumption effectively.

4. Scope of Revisional Jurisdiction Under Sections 397 and 401 of the Code of Criminal Procedure:
The court discussed the limited scope of revisional jurisdiction, emphasizing that it is not as wide as appellate jurisdiction and should not be used to re-appreciate evidence unless there is a glaring miscarriage of justice. It cited the Supreme Court's decision in State of Kerala v. Puttumana Illath Jathavedan Namboodiri, which stated that the High Court's revisional jurisdiction is supervisory and should only correct miscarriages of justice. The court also referred to Sanjaysinh Ramrao Chavan v. Dattatray Gulabrao Phalke, which held that revisional jurisdiction should not interfere with lower court orders unless they are perverse, wholly unreasonable, or involve non-consideration of relevant material. The court found no such issues in the concurrent verdicts of the lower courts and thus declined to interfere with the conviction and sentence.

Conclusion:
The revision petition was dismissed, and the accused was given two months to pay the compensation and undergo the sentence. The court directed the accused to appear before the trial court on 30.12.2022 to comply with the order, with the execution of the sentence deferred until 29.12.2022.

← Previous Next →