2018 (7) TMI 101 - SC - Indian Laws

Validity of Conviction order set aside by High Court - dishonor of cheque due to insufficiency of funds - Section 138 of the Negotiable Instruments Act, 1881 - rebutting of presumption - High Court held that the accused has been successful in creating doubt in the mind of the Court with regard to the existence of the debt or liability - Held that - The trial court after considering the evidence on record has returned the finding that the cheque was issued by the accused which contained his signatures. Although, the complainant led oral as well as documentary evidence to prove his case, no evidence was led by the accused to rebut the presumption regarding existence of debt or liability of the accused. The High Court has not returned any finding that order of conviction based on evidence on record suffers from any perversity or based on no material or there is other valid ground for exercise of revisional jurisdiction. There is no valid basis for the High Court to hold that the accused has been successful in creating doubt in the mind of the Court with regard to the existence of the debt or liability. The appellant has proved the issuance of cheque which contained signatures of the accused and on presentation of the cheque, the cheque was returned with endorsement insufficient funds . Bank official was produced as one of the witnesses who proved that the cheque was not returned on the ground that it did not contain signatures of the accused rather it was returned due to insufficient funds - the judgment of High Court is liable to be set aside on this ground alone. Whether there was any doubt with regard to the existence of the debt or liability of the accused? - Section 139 of the Act, 1881 - Held that - In the present case, the trial court as well as the Appellate Court having found that cheque contained the signatures of the accused and it was given to the appellant to present in the Bank of the presumption under Section 139 was rightly raised which was not rebutted by the accused. The accused had not led any evidence to rebut the aforesaid presumption. The High Court committed error in setting aside the order of conviction in exercise of revisional jurisdiction. No sufficient ground has been mentioned by the High Court in its judgment to enable it to exercise its revisional jurisdiction for setting aside the conviction. The judgment of the High Court is set aside and judgment of trial court as affirmed by the Appellate Court is restored - appeal allowed.

Summary

Issues Involved:
1. Validity of the High Court's exercise of revisional jurisdiction under Section 397/401 Cr.P.C.
2. Presumption under Section 139 of the Negotiable Instruments Act, 1881.
3. Evidence and burden of proof regarding the existence of debt or liability.

Issue-wise Detailed Analysis:

1. Validity of the High Court's exercise of revisional jurisdiction under Section 397/401 Cr.P.C.:

The appellant challenged the High Court's judgment that set aside the conviction of the accused under Section 138 of the Negotiable Instruments Act, 1881. The appellant argued that the High Court had no jurisdiction to re-appreciate the evidence on record and substitute its own opinion, as the findings of the trial court and appellate court were not perverse or without evidence. The Supreme Court reiterated that the revisional jurisdiction of the High Court is supervisory and not equivalent to appellate jurisdiction. It cited precedents like State of Kerala vs. Puttumana Illath Jathavedan Namboodiri and Sanjaysinh Ramrao Chavan vs. Dattatray Gulabrao Phalke, emphasizing that the High Court should not interfere unless the findings are perverse, wholly unreasonable, or there is non-consideration of relevant material. The Supreme Court found that the High Court exceeded its jurisdiction by reappreciating evidence and substituting its own view without any legal basis.

2. Presumption under Section 139 of the Negotiable Instruments Act, 1881:

The trial court had drawn a presumption under Section 139 of the Act, which states that it shall be presumed, unless the contrary is proved, that the holder of a cheque received it for the discharge of debt or liability. The Supreme Court referred to Kumar Exports vs. Sharma Carpets and Rangappa vs. Sri Mohan, explaining that this presumption is rebuttable. The accused must bring forward evidence to disprove the presumption. In this case, the accused neither provided evidence nor testified to rebut the presumption. The trial court and appellate court found that the cheque contained the accused's signatures and was issued for debt repayment, which the accused failed to rebut.

3. Evidence and burden of proof regarding the existence of debt or liability:

The Supreme Court examined whether there was any doubt about the existence of the debt or liability. It noted that the complainant had provided both oral and documentary evidence, while the accused did not present any evidence to counter the presumption. The defence claimed that the cheque was stolen, but this was rejected by the trial court based on the evidence. The Supreme Court found no valid basis for the High Court's conclusion that the accused created doubt about the debt or liability. The High Court's judgment lacked sufficient grounds to exercise revisional jurisdiction and set aside the conviction.

Conclusion:

The Supreme Court allowed the appeal, set aside the High Court's judgment, and restored the trial court's conviction and sentence. The High Court had erred in its exercise of revisional jurisdiction, and the presumption under Section 139 was rightly drawn against the accused, who failed to rebut it. The conviction under Section 138 of the Negotiable Instruments Act, 1881, was upheld.