2020 (3) TMI 986 - HC - Indian Laws

Dishonor of Cheque - preponderance of probability - discharge the burden under Section 139 of the Negotiable Instruments Act - HELD THAT - In the cross-examination of the complainant (P.W.1), it was suggested to him that the eight cheques were given only as security on the promise that the complainant will arrange an educational loan for the daughter of the accused, but he did not arrange the loan and instead, misused the cheques. The complainant denied this suggestion. The defence was not able to make any serious dent in the testimony of the complainant (P.W.1) in the cross-examination - If the complainant had failed to arrange the promised loan, the accused would have issued directions to his Bank to stop payment, but that was not done. The accused also did not issue any reply notice to the statutory demand notice sent by the complainant. Of course, that by itself, cannot be a reason to hold against the accused. But, that circumstance, if viewed cumulatively with other circumstances, does make this Court to reject the defence theory. The defence theory, that the eight post dated cheques for ₹ 20,000/- each were given in anticipation of a loan that was promised by the complainant, defies credibility. Though the accused can discharge the burden under Section 139 of the Negotiable Instruments Act by preponderance of probability even that has not been done in this case - this Criminal Revision Case is devoid of merits and stands dismissed.

Summary

Issues:
1. Conviction under Section 138 of the Negotiable Instruments Act.
2. Burden of proof on the accused to rebut the presumption of consideration.
3. Applicability of statutory presumption of consideration.
4. Evaluation of evidence presented by the complainant and the accused.
5. Revisional jurisdiction of the High Court in cases with concurrent findings.

Issue 1: Conviction under Section 138 of the Negotiable Instruments Act
The case involved the accused borrowing money and issuing post-dated cheques, which were subsequently dishonored. The complainant initiated prosecution under Section 138 of the Negotiable Instruments Act. The trial court convicted the accused, sentencing him to rigorous imprisonment and a fine. The appeal by the accused was dismissed by the Principal Sessions Judge, leading to the filing of a Criminal Revision Case before the High Court.

Issue 2: Burden of proof on the accused to rebut the presumption of consideration
The accused attempted to discharge the burden under Section 139 of the Negotiable Instruments Act by examining witnesses and presenting a defense. However, the accused failed to provide a satisfactory explanation regarding the issuance and dishonor of the cheques, leading to the rejection of the defense theory by the Court.

Issue 3: Applicability of statutory presumption of consideration
The Court emphasized the statutory presumption of consideration in cases of dishonored cheques. The burden lies on the accused to rebut this presumption, failing which the Court may uphold the conviction under Section 138 of the Act. The accused's failure to provide a credible explanation regarding the issuance of the cheques worked against his defense.

Issue 4: Evaluation of evidence presented by the complainant and the accused
The complainant's testimony and evidence, including the presentation of the cheques and the demand notice, were found to be consistent and credible. The defense witnesses, including the accused, failed to provide a convincing account of the events leading to the dishonor of the cheques. Discrepancies in the defense theory and lack of concrete evidence to support the accused's claims led to the rejection of the defense's arguments.

Issue 5: Revisional jurisdiction of the High Court in cases with concurrent findings
The High Court highlighted the limited scope of revisional jurisdiction when faced with concurrent findings of fact by lower courts. Citing precedents, the Court reiterated that it cannot function as a second appellate court and interfere with judgments unless there is a jurisdictional error. The Court, after careful consideration of the evidence and arguments presented, upheld the concurrent findings of the lower courts and dismissed the Criminal Revision Case.

This detailed analysis of the judgment provides insights into the legal principles applied, the evaluation of evidence, and the reasoning behind the High Court's decision to confirm the conviction under Section 138 of the Negotiable Instruments Act.