2024 (10) TMI 554 - HC - Indian Laws

Dishonour of Cheque - petitioner-accused is not coming forward to deposit the amount - existence of a legally enforceable debt or liability - failure to lead any evidence - presumption under Sections 118 and 139 of the Negotiable Instruments Act - HELD THAT - This Court finds that both the Courts below have dealt with each and every aspect of the matter meticulously and there is no scope left for this Court to interfere. Interestingly, in the case at hand, at no point of time, factum with regard to issuance of cheque as well as signature thereupon ever came to be refuted by the accused, rather she attempted to carve out a case that she had only borrowed sum of Rs. 2,00,000/-, which was returned, but cheques obtained as security by the complainant were misused. Since aforesaid defence sought to be raised was never probablized by leading cogent and convincing evidence, both the Courts below rightly invoked Sections 118 and 139 of the Act, which speak about presumption in favour of holder of cheque that cheque in question was issued towards discharge of lawful liability. No doubt, aforesaid presumption is rebuttable, but to rebut such presumption, accused is required to raise probable defence. Despite sufficient opportunity, accused failed to lead any evidence. In the instant case, neither accused could show in his pleadings as well as evidence of the complainant that sum of Rs. 6,50,000/- was never borrowed by her, rather she had taken only Rs. 2,00,000/-, which was also returned nor she lead any positive evidence to probabalize aforesaid defence set up by her. The Hon ble Apex Court in M/S LAXMI DYECHEM VERSUS STATE OF GUJARAT ORS. 2012 (12) TMI 106 - SUPREME COURT , has categorically held that if the accused is able to establish a probable defence, which creates doubt about the existence of a legally enforceable debt or liability the prosecution can fail. To raise probable defence, accused can rely on the materials submitted by the complainant. Needless to say, if the accused/drawer of the cheque in question neither raises a probable defence nor is able to contest existence of a legally enforceable debt or liability, statutory presumption under Section 139 of the Negotiable Instruments Act, regarding commission of the offence comes into play. Factum with regard to issuance of cheques as well as signatures thereupon stands duly established and as such, no illegality can be said to have been committed by the learned Court below, while invoking Sections 118 and 139 of the Act. In his cross-examination, CW1 admitted that he has transferred Rs. 2,00,000/- to the accused. He also admitted that his 2-3 cases of dishonour of cheques are pending adjudication in the Court. However, he denied that accused demanded cheques after returning the borrowed amount. This Court sees no reason to interfere with the well reasoned judgments recorded by the Courts below, which otherwise, appear to be based upon proper appreciation of evidence available on record and as such, same are upheld. The present criminal revision petition is dismissed being devoid of any merit. The petitioner is directed to surrender before the learned trial Court forthwith to serve the sentence as awarded by the learned trial Court, if not already served. Interim direction, if any, stands vacated.

Issues Involved:
1. Validity of the conviction and sentence under Section 138 of the Negotiable Instruments Act.
2. Presumption under Sections 118 and 139 of the Negotiable Instruments Act.
3. Jurisdiction and scope of revisional powers under Section 397 of the Cr.PC.
4. The concept of "security cheque" and its implications under Section 138 of the Negotiable Instruments Act.

Issue-wise Detailed Analysis:

1. Validity of the Conviction and Sentence under Section 138 of the Negotiable Instruments Act:
The petitioner challenged the conviction and sentence passed by the lower courts, which found the accused guilty under Section 138 of the Negotiable Instruments Act. The accused had issued two post-dated cheques to the complainant, which were dishonoured due to insufficient funds. Despite receiving a legal notice, the accused failed to make the payment. The trial court, followed by the appellate court, found the accused guilty, leading to the current revision petition. The High Court upheld the conviction, noting that the accused did not refute the issuance of the cheques or the signatures thereon and failed to provide any cogent evidence to support her defense.

2. Presumption under Sections 118 and 139 of the Negotiable Instruments Act:
The courts below invoked Sections 118 and 139, which presume that the cheque was issued for the discharge of a lawful liability. The accused attempted to argue that the cheques were misused and were only security for a lesser amount borrowed, which she claimed to have repaid. However, this defense was not substantiated with credible evidence. The High Court reiterated that the statutory presumption under Section 139 is rebuttable, but the accused must raise a probable defense, which was not done in this case.

3. Jurisdiction and Scope of Revisional Powers under Section 397 of the Cr.PC:
The High Court emphasized its limited jurisdiction under Section 397 of the Cr.PC, which is primarily supervisory and not equivalent to appellate jurisdiction. The revisional power is meant to correct miscarriages of justice, not to re-appreciate evidence unless there is a glaring error. The court found no such miscarriage or error in the concurrent findings of the lower courts, thus upholding their judgments.

4. The Concept of "Security Cheque" and its Implications under Section 138 of the Negotiable Instruments Act:
The court addressed the issue of whether a cheque issued as security can attract liability under Section 138. Citing precedents, it clarified that a security cheque, if dishonoured, can lead to prosecution under Section 138 if it was intended to secure a lawful obligation that was not fulfilled. The court found that the complainant had successfully demonstrated the accused's liability and the purpose of the cheques, dismissing the argument that they were merely security without enforceable debt.

In conclusion, the High Court dismissed the revision petition, affirming the judgments of the lower courts. The petitioner was directed to surrender to serve the sentence, and any interim directions were vacated. The court's decision was based on a thorough examination of the evidence and legal principles, with no material irregularities found in the proceedings of the lower courts.

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