2023 (10) TMI 219 - HC - Indian Laws

Dishonour of Cheque - insufficient of funds - burden of proof lies on the petitioner but he failed to prove his case - rebuttal of presumption - HELD THAT - The presumption under Section 139 of Negotiable Instruments Act is rebuttable presumption and if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability the prosecution can fail. Further the burden was heavily upon the claimant to have showed that he had required funds for having advance money to the accused. In the case on hand the accused admitted the signature found in the cheque and issuance of cheque but the contention of the petitioner is that he already repaid the amount but the said repayment was not proved by the petitioner. The issue in the case of Tedhi Singh v. Narayan Dass Mahant 2022 (3) TMI 797 - SUPREME COURT and John K. Abraham v. Simon C.Abraham and another 2014 (1) TMI 528 - SUPREME COURT are not applicable in the facts of the present case. On careful reading of the judgment it is clear that once the accused admitted the issuance of cheque or signature found in the cheque the presumption under Section 139 of Negotiable Instruments Act would operate and the burden was on the accused to disprove the cheque or existence of legally enforceable debt - in the case on hand also the accused admitted the issuance of cheque signature of cheque and thereby he has to disprove the cheque and his liability but he failed to prove the same. Thereby the aforesaid case law will squarely applicable to the present facts of the case. In this case the oral and documentary evidences and witnesses clearly established the case of the complainant and the defence theory put forth by the accused was not proved and thereby the trial Court as well as the appellate Court came to the fair conclusion and convicted the petitioner/accused for the offence under Section 138 of Negotiable Instruments Act. There is no infirmity found in the judgment of the Courts below and thereby this Court warrants no interference. The Criminal Revision Petition is dismissed.

Summary

Issues Involved:
1. Legally enforceable debt and issuance of cheque
2. Presumption under Section 139 of the Negotiable Instruments Act
3. Evidence and burden of proof

Summary of the Judgment:

Issue 1: Legally enforceable debt and issuance of cheque
The petitioner was convicted by the trial court for the offence under Section 138 of the Negotiable Instruments Act for issuing a cheque that was dishonored due to insufficient funds. The petitioner had borrowed Rs.4,00,000 from the complainant and issued a cheque dated 16.03.2015. Upon presentation, the cheque was returned unpaid. The trial court sentenced the petitioner to three months of simple imprisonment and a compensation of Rs.4,00,000. The appellate court confirmed the conviction and sentence, leading to the present revision case.

Issue 2: Presumption under Section 139 of the Negotiable Instruments Act
The petitioner admitted to issuing the cheque and his signature on it but contended that the cheque was issued as security for a loan of Rs.2,00,000, which was repaid. The petitioner argued that the complainant misused the cheque. The trial court held that the presumption under Section 139 of the Negotiable Instruments Act was in favor of the complainant, and the petitioner failed to rebut this presumption with sufficient evidence. The appellate court upheld this view.

Issue 3: Evidence and burden of proof
The petitioner's defense was that he had repaid the loan and the complainant retained the cheque and other documents. However, the trial court found that the petitioner failed to prove the repayment and the alleged misuse of the cheque. The court noted discrepancies in the petitioner's evidence and found the complainant's case credible. The appellate court also found that the petitioner did not provide sufficient evidence to rebut the presumption under Section 139. The judgments cited by the petitioner were not applicable to the present case as the petitioner failed to prove the repayment of the loan.

Conclusion:
The High Court dismissed the criminal revision petition, confirming the judgment and conviction passed by the Additional District and Sessions Court, Theni, and the Judicial Magistrate (Fast Track Court), Uthamapalayam. The court found no infirmity in the judgments of the lower courts and directed the trial court to secure the accused according to law.