2023 (7) TMI 657 - HC - Indian Laws

Dishonour of Cheque - existence of debt/liability or not - firm of complainant, not registered - no prove the mercantile transaction - rebuttal of presumption - bar under Section 69(2) of the Indian Partnership Act. Bar under Section 69(2) of the Indian Partnership Act - HELD THAT - It is observed that bar under Section 69(2) of the Indian Partnership Act will not come in the way of the Complainant in filing the complaint under Section 138 of the Negotiable Instruments Act. Proof of the debt/liability - HELD THAT - It is true that the Respondent-accused has not denied execution of the cheque in the notice reply at Exh. 45. He has stated that he has issued the cheque at the instance of one Bhalerao. Even in his statement under Section 313 of the Criminal Procedure Code, he has stated the same fact while answering question no. 4. If it is so then presumption under Section 139 of the Negotiable Instruments Act will come into picture or not and by way of seeing whether it is rebutted by the accused or whether the findings of the trial Court are correct or not. Rebuttal of presumption - HELD THAT - It is settled law that the presumption can be rebutted by adducing evidence separately or by cross-examining the Complainant. In case of PANKAJ MEHRA VERSUS STATE OF MAHARASHTRA 2000 (2) TMI 718 - SUPREME COURT there is observation of the Hon ble Supreme Court to interpret the meaning of the word the drawer of such cheque fails to make the payment and the drawer refuses to make the payment . Failure to make payment can be for various reasons - when there is failure to make payment, offence is committed. In nutshell, this failure to make payment has been interpreted in wider sense - In case of K. Bhaskaran Vs. Sankaran Vaidhyan Balan and Anr. 1999 (9) TMI 941 - SUPREME COURT , the Hon ble Supreme Court opined that once the signature on cheque is admitted, presumption comes into picture and burden is on accused to rebut the presumption, there cannot any dispute on this preposition of law. It is true that accused has not examined the said Bhalerao at whose instance the cheque was issued. He has examined the Jugalkishor Bansilal Tiwari as owner of the J. K. Construction. He has also produced work orders. He has taken on hire the Poclain machine from the Complainant - the Complainant ought to have been substantiated his contention that in fact he has given on a hire Poclain machine to the accused, this is not plea which is taken by way of after thought while cross-examining the Complainant. This plea was taken while dealing notice reply. There are no fault in the findings of the trial Court. On one hand he has denied the relationship with the Complainant and on the other hand he has brought on record through evidence of Mr. Tiwari that in fact it is Tiwari who has taken a machine on hire from the Complainant and not by him. It is sufficient to rebut the presumption - Learned Advocate for the Appellant relied upon these observations to contend that Respondent cannot take up a plea that there was no mercantile transaction. This argument is illogical. Because Section 139 of the Negotiable Instruments Act itself say about rebuttal of presumption. It is one thing to say that you cannot take up plea and another thing to say that plea is not proved. In this case defence taken by the accused was permissible and he has proved it also. There are no fault in the findings recorded by the trial Court. It cannot be said that findings are perverse. Hence no interference is wanted - appeal dismissed.

Summary

Issues involved:
The issues involved in the judgment are the maintainability of a complaint by an unregistered firm under Section 138 of the Negotiable Instruments Act and the burden of proof regarding a mercantile transaction between the parties.

Maintainability of complaint by unregistered firm:
The Court considered the judgment in the case of Suraj Prakash Gupta v. State of Jammu & Kashmir where it was held that a complaint filed by an unregistered firm is not maintainable. However, a Division Bench in the case of Narendra Vs. Balbirsingh clarified that the bar under Section 69(2) of the Indian Partnership Act does not prevent a complaint under Section 138 of the Negotiable Instruments Act. The Court referred to the Division bench's observation that the complaint by an unregistered firm is maintainable, even if this observation was made after the original complaint was decided. Therefore, the Court held that the complaint by the unregistered firm is maintainable.

Proof of the debt/liability:
The Respondent-accused did not deny issuing the cheque but claimed it was done at the instance of another individual. The Court examined the evidence presented by both parties, including witnesses and documents. The Court noted that the accused had not examined the individual at whose instance the cheque was issued but relied on the owner of J. K. Construction. The Court found that the Complainant failed to substantiate the claim of providing a Poclain machine to the accused with documentary evidence. As a result, the Court concluded that the accused had successfully rebutted the presumption under Section 139 of the Negotiable Instruments Act. The Court cited previous cases to support the principle that the burden is on the accused to rebut the presumption, and in this case, the accused had done so effectively.

Conclusion:
The Court found no fault in the trial court's findings and concluded that the judgment was not perverse. The Court emphasized that the accused had successfully rebutted the presumption under the Negotiable Instruments Act by presenting evidence contrary to the Complainant's claims. As a result, the appeal was dismissed, and no interference with the trial court's decision was warranted.