2019 (8) TMI 822 - HC - Indian Laws

Dishonor of Cheque - insufficiency of funds - legally enforceable debt or not - existence of loan or not - section 138 of NI Act - rebuttable presumption - acquittal of accused - HELD THAT - In the instant case, the accused has succeeded in discharging her burden to rebut the presumption under Section 139 of the Act by leading evidence and also by relying upon the improbabilities in the case set up by the complainant. The evidence of DW1 proves that she had sold 10 cents of property to the father of the complainant in the year 2002 and at the time of the sale, there was liability towards the bank which was a charge on that property. PW1 has admitted on cross examination that his father had purchased 10 cents of property from the mother of the accused. DW1 has given evidence regarding the sale of 10 cents of property by her to the father of the complainant and the payment of the amount due to the bank by the father of the complainant. There is no cross examination of DW1 on these aspects. The complainant has no case that the amount paid by his father to discharge the liability towards the bank was adjusted in the sale consideration - In such circumstances, the evidence of DW1 that she had given Ext.P1 cheque to the father of the complainant as security for the amount due to him, is reliable and trustworthy. It is significant that there is no averment in the complaint that the accused had borrowed ₹ 1,50,000/- from the complainant on 15.02.2004 or on any other date. The averment in the complaint is only that the accused owed ₹ 1,50,000/- to the complainant. In the particular circumstances of the present case, absence of averment in the complaint on that aspect, is fatal to the case of the complainant - In view of the presumption envisaged under Section 139 of the Act, absence of averment in the complaint regarding any subsisting liability, will not affect the maintainability of the complaint. But, it may help the accused to prove that the plea raised by him is probable and that the case set up by the complainant in evidence is highly improbable. Thus, the accused had discharged the onus of proving that Ext.P1 cheque was not received from her by the complainant in discharge of a debt or liability. Under the circumstances, the onus or burden had shifted on the complainant. The complainant did not produce any material to prove that he had, in fact, given ₹ 1,50,000/- to the accused as a loan - thus, the complainant had failed to establish his case. Appeal dismissed.

Summary

Issues:
Challenge to acquittal under Section 138 of Negotiable Instruments Act

Analysis:
The appellant, as the complainant, challenged the acquittal of the accused under Section 138 of the Negotiable Instruments Act. The complainant alleged that the accused owed him a sum of money, for which she issued a cheque that bounced due to insufficient funds. The trial court acquitted the accused, finding that the cheque was not issued in discharge of a legally enforceable debt.

The complainant presented evidence including the cheque, bank memorandum, lawyer notice, and the returned unserved notice. The accused denied the financial transaction, stating that her mother gave a blank cheque as security, which the complainant misused. The accused's mother corroborated this version.

The court emphasized that the burden is on the accused to rebut the presumption under Section 139 of the Act. The accused must show the non-existence of debt or liability through direct or circumstantial evidence. In this case, the accused successfully rebutted the presumption by demonstrating the improbabilities in the complainant's case.

The evidence showed that the accused sold property to the complainant's father, and the cheque was given as security for the amount due. The accused's plea that the complainant lacked financial capacity to lend the amount was also considered. The court found that the complainant failed to establish his case, leading to the dismissal of the appeal challenging the acquittal.

In conclusion, the judgment highlights the importance of evidence and burden of proof in cases under Section 138 of the Negotiable Instruments Act. The accused successfully rebutted the presumption, and the court found the complainant's case lacking in evidence to establish the debt or liability claimed.