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2023 (6) TMI 1148 - HC - Indian LawsDishonour of Cheque - Respondent/ Accused was acquitted for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 - failure to disclose in statement of Account the amount which was due to him from the Accused for the year ending 31.03.2015 - failure to step into the witness box and the presumption under Section 139 of the N.I. Act has not at all been rebutted - error in shifting such burden on the Complainant or not - HELD THAT - There are catena of decisions showing the settled proposition of law that once the signature on the cheque is not disputed and when conditions imposed under Section 138 of the N.I. Act are fulfilled while presenting the cheque and thereafter, by issuing legal notice, the Magistrate is duty bound to draw a presumption under Section 139 of the N.I. Act in favour of the Complainant that such cheque is issued towards legally enforceable debt. The cheque in question was issued by the Accused, which is not at all disputed. The question which the Accused tried to raise is that such a cheque is not issued towards the supply of material. The burden of this aspect in order to rebut the presumption under Section 139 of the N.I. Act is certainly on the Accused. The cross examination of the Complainant shows only suggestions given to the Complainant to that effect. The delivery challans are produced by the Complainant, which were disbelieved by the Trial Court on the precise ground that the signature on the said delivery challans are not matching with the signature of the Accused - The person who receives the material at the site normally signs such delivery challans. Therefore, comparing the signature of the Accused where there is no denial to show that he personally did not receive such material at the site was completely unwarranted. The observations of the learned Magistrate in paragraph 36 of the impugned judgment are therefore clearly perverse and against the documents produced on record since there is no other material which has been brought on record on behalf of the Accused and of rebutting presumption under Section 139 of the N.I. Act, dismissal of the complainant and acquittal of the Accused by the Trial Court needs to be interfered - appeal allowed.
Issues involved:
The appellant challenges the judgment acquitting the accused under Section 138 of the Negotiable Instruments Act, 1881. Summary: Issue 1: Rebutting the presumption under Section 139 of the N.I. Act The appellant contended that the accused failed to rebut the presumption under Section 139 of the N.I. Act. The accused's defense, claiming misuse of the cheque, was not supported by evidence. The trial court failed to draw the mandatory presumption in favor of the complainant, as required by law. Issue 2: Burden of proof The trial court erred in shifting the burden of proof onto the complainant. The court ignored the settled proposition of law that once the signature on the cheque is not disputed, the presumption under Section 139 must be drawn in favor of the complainant. The accused's failure to provide a specific defense further weakened their case. Facts: The complaint was filed under Section 138 of the N.I. Act, alleging non-payment of a cheque issued for construction material supplied. The accused denied the supply and claimed a partnership dispute. However, the reply did not contest the signature on the cheque. The complainant presented evidence, including income tax returns and delivery challans, while the accused failed to testify. Court's Analysis: The trial court overlooked the presumption under Section 139 and wrongly placed the burden on the complainant. The accused's arguments were not substantiated, and the evidence presented by the complainant, including financial records, supported the claim. The trial court's findings were deemed erroneous and against the documented evidence. Judgment: The appeal was allowed, overturning the acquittal of the accused. The accused was found guilty under Section 138 of the N.I. Act and sentenced to 15 days' imprisonment and ordered to pay double the cheque amount as compensation. Failure to comply would result in further imprisonment. The accused was directed to surrender within ten days.
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