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2020 (12) TMI 1007 - HC - Indian LawsDishonor of Cheque - Funds Insufficient - specific defence was taken that the cheque was given to the brother of the complainant and the same was misused - HELD THAT - No suggestion was made to P.W.1 that those two letters Exs.D.1 and 3 are served on him. But he categorically admits that Ex.D.1 was not sent through registered post and also admits that the cover was also not returned. But he claims that Ex.D.1 was sent to the office address of the complainant. He also admits that he has not given any reply through his counsel. It is also important to note that he categorically admits that he has not given any stop payment. The complainant disputes the documents Exs.D.1 to 3. When the accused admits the signature on Ex.P.1, he has to rebut the evidence of the complainant. It is also elicited from the mouth of D.W.1 that he has not given any letter to the bank and also not given any notice to Ashok, when he did not return the other cheque. Though he claims that he gave the complaint, he categorically admits that no endorsement was given by the police. It is also important to note that earlier also he had availed loan from Ashok, but while availing the loan earlier, he has not given any cheque to Ashok for security. There is no dispute that the accused has to place the material of preponderance of probabilities. In the case on hand, I have already pointed out that though an attempt is made by the accused to place the preponderance of probabilities, those documents are not worthwhile to accept the defence and the evidence of D.W.2 is also not worthwhile. The Appellate Court while reversing the findings of the Trial Court has assigned the reasons that the handwriting available in Ex.P.1 are in different ink. P.W.1 in the cross-examination admits the same. But the fact that he has signed the cheque and handed over the same, has not been explained. D.Ws.1 and 2 in their cross- examination categorically admits that they went to the office of the complainant - If no transaction was taken place between them, what made them to go to the house or the office of the complainant, is not explained. On perusal of 313 statement of the accused also, nothing is stated with regard to availing of loan from the brother of the complainant and handing over the cheques to Ashok. The defence in the cross-examination got elicited that loan was given on 05.10.2006 and though in the complaint and legal notice, the complainant has not stated the date of loan transaction, the answers elicited from the mouth of P.W.1 is clear that loan was given on 05.10.2006. P.W.1 categorically says that in the early morning, the accused and his brother came to his office and took the money. The accused did not dispute the signature found on Ex.P.1 and notice issued against him. Though he claims that he gave reply in terms of Exs.D.1 and 3, the same cannot be accepted - The judgment of the Hon'ble Apex Court in the case of RANGAPPA VERSUS SRI MOHAN 2010 (5) TMI 391 - SUPREME COURT , is clear that if the accused has not given any reply to the notice and not disputed the signature found in Ex.P.1, the Court must draw the presumption under Section 139 of the N.I. Act. Hence, the very contention of the accused counsel cannot be accepted. Appeal allowed - decided in favor of appellant.
Issues Involved:
1. Whether the Appellate Court erred in acquitting the accused for the offence punishable under Section 138 of the NI Act. 2. What order should be passed. Detailed Analysis: Issue 1: Whether the Appellate Court erred in acquitting the accused for the offence punishable under Section 138 of the NI Act. The factual matrix of the case involves the complainant alleging that the accused had taken a hand loan of ?1,50,000 and issued a cheque dated 27.10.2004 to discharge the liability. The cheque was dishonored due to "Funds Insufficient". Despite legal notice, the accused did not reply, leading to the filing of the complaint. The Trial Court convicted the accused under Section 138 of the Negotiable Instruments Act, 1881. However, the Appellate Court reversed this decision, acquitting the accused. The complainant contended that the Appellate Court erred in appreciating the evidence and wrongly permitted the appellant to produce documents (Exs.D4 to D7). The complainant testified as P.W.1, substantiating his claim with documents (Exs.P1 to P8). The accused, examined as D.W.1, along with witnesses D.W.2 and D.W.3, presented documents (Exs.D1 to D7 and Ex.P9). The Appellate Court’s decision was based on the evidence of D.W.3, who testified that the vehicles were not registered in the complainant’s name, thus questioning the complainant’s financial capacity. The High Court noted that the accused admitted the signature on the cheque but contended the writings were in different ink. The accused's defense was that the cheque was given to the complainant's brother for a different loan of ?25,000, which was repaid, but the cheques were not returned. However, no substantial evidence was provided to support this claim. The accused also failed to provide documentary proof of replies to the notices (Exs.D1 to D3). The High Court emphasized that once the signature on the cheque is admitted, a presumption under Section 139 of the NI Act arises, which the accused must rebut. The accused's attempts to discredit the complainant's financial capacity and the authenticity of the cheque were not convincing. The evidence of D.W.2 did not inspire confidence, and the documents (Exs.D1 to D3) lacked credibility. The High Court found that the Appellate Court erred in its judgment by not properly considering the admissions and the lack of credible evidence from the accused. The Appellate Court mainly relied on the evidence of D.W.3 without adequately addressing the other evidence and admissions. Issue 2: What order should be passed. The High Court concluded that the Appellate Court’s judgment was perverse and not supported by the material on record. The High Court restored the judgment of the Trial Court, convicting the accused under Section 138 of the NI Act. Order: 1. The appeal is allowed. 2. The Appellate Court’s judgment dated 03.11.2010 in Criminal Appeal No.37/2009 is set aside. 3. The Trial Court’s judgment dated 02.01.2009 in C.C.No.476/2007 is restored. 4. The registry is directed to send the records to the concerned Trial Court forthwith.
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