2023 (12) TMI 669 - HC - Indian Laws

Dishonour of Cheque - insufficient funds - discharge of debt or not - apparent error or not, on the face of the record in the judgment of the Trial Court as well as the First Appellate Court in convicting the accused for the offence punishable under Section 138 of the Negotiable Instruments Act - HELD THAT - In the instant case, the complainant has produced the cheque in question and it is marked as Ex.P1. The signature of the accused is also marked as Ex.P1(a). The bank endorsements are also marked as Exs.P2 and P3. On perusal of all these documents, it clearly establishes that the accused has not disputed the issuance of cheque and service of legal notice on him. As per the presumption available under the NI Act, the complainant has complied the legal requirements under Section 138 of the Act. Now, the burden shifts on the accused to disprove the case of the complainant. On perusal of the evidence on record, the accused has taken up the contention that the cheque was issued to one Rajesh Bhat for different transaction and for security of the said transaction, he had issued the cheque, but the complainant by misusing the same, presented the said cheque for encashment in the year 2010 by filling the contents of Ex.P1-cheque and thereby he misused the cheque and therefore, the accused has taken such contention - In the instant case, the complainant has proved that on the relevant date, he lent loan to the accused and in consideration thereof, the accused issued cheque Ex.P1 in favour of the complainant. Further the accused has not placed any material before the Court to prove under what circumstances he issued cheque in favour of the complainant. Further, the accused has taken up a contention that he discharged the loan of one Rajesh Bhat and he never called upon the said Rajesh Bhat to return the cheque in question, if he has discharged the loan in complete, further he also failed to call upon the complainant to return the cheque in question, as it was not issued to him. The burden lies on the accused to prove non- existence of consideration which would lead to the Court to disbelieve the non-existence of consideration either by direct evidence or by probable defence to show that the existence of consideration was improbable, doubtful or illegal, but the accused has not produced any kind of evidence to show that existence of consideration was improbable, doubtful or illegal. Therefore, Ex.P1-cheque was issued towards legally enforceable debt - When once issuance of cheque is proved, the presumption under Section 138 of N.I.Act would arise with regard to consideration. But the accused has not discharged the debt in question. Whether the accused has issued cheque for repayment of loan or as security or it was discharged prior to the current transaction, makes no difference under Section 138 of the N.I.Act. The legal consequence reamaining same without any distinction. The judgment of the Trial Court as well as the First Appellate Court is in accordance with law. The Trial Court as well as the First Appellate Court have passed well reasoned orders. Hence no interference is called for and there is no error on the face of the record - Revision petition dismissed.

Summary

Issues involved:
The issues involved in this case are whether the accused proved that there is an apparent error in the judgment of the Trial Court and the First Appellate Court in convicting him under Section 138 of the Negotiable Instruments Act, and whether the judgment of conviction and sentence is perverse and requires interference.

Complainant's Case:
The complainant filed a private complaint under Section 200 of Cr.P.C., alleging that the accused borrowed Rs.50,000 and issued a cheque which was dishonored due to insufficient funds. The complainant proved his case through oral and documentary evidence, including the cheque, legal notice, and postal acknowledgments. The accused failed to repay the amount due under the cheque despite legal notice.

Accused's Defense:
The accused contended that the cheque was issued for a different transaction with another person and was misused by the complainant. He argued that there was no legally enforceable debt due to him as he had already repaid the amount to the other party. The accused failed to provide evidence to disprove the complainant's case.

Court's Analysis:
The Court examined the evidence presented by both parties, including the cheque, bank endorsements, legal notices, and oral testimonies. It was established that the accused issued the cheque to the complainant and failed to dispute its issuance or the legal notice served. The Court noted that the complainant fulfilled the legal requirements under Section 138 of the Act, shifting the burden to the accused to disprove the case.

Presumptions and Legal Consequences:
The Court highlighted that under the Negotiable Instruments Act, when a negotiable instrument is admitted, the Court may draw presumptions in favor of the holder. The accused's failure to prove the non-existence of consideration led the Court to conclude that the cheque was issued towards a legally enforceable debt. The Court emphasized that the legal consequences remain the same regardless of whether the cheque was for repayment or security.

Judgment:
After considering the arguments and evidence presented, the Court found no error in the judgments of the Trial Court and the First Appellate Court. The accused's revision petition was dismissed, and the judgments of conviction and sentence were confirmed. The Court concluded that the lower courts had passed well-reasoned orders, and no interference was warranted.