2021 (12) TMI 234 - HC - Indian Laws

Dishonor of Cheque - cheque was issued for discharge of legal liability towards complainant or not - failure to rebut the onus of proof and statutory presumption under Sections 118(a) and 139 of the NI Act - acquittal of the accused - HELD THAT - It is well settled by catena of decisions that an appellate Court has full power to review, re-appreciate and consider the evidence upon which the order of acquittal is founded. However, the Appellate Court must bear in mind that in case of acquittal, there is prejudice in favour of the accused, firstly, the presumption of innocence is available to him under the fundamental principle of criminal jurisprudence that every person shall be presumed to be innocent unless he is proved guilty by a competent court of law. Secondly, the accused having secured his acquittal, the presumption of his innocence is further reaffirmed and strengthened by the trial Court. The fact remains that there appears nothing on record to substantiate the claim of the complainant that the debt was legally enforceable debt for want of any material to substantiate the same and therefore, in the overall facts and circumstances of the case, the learned Magistrate has come to the conclusion that the debt cannot be said to be the legally enforceable debt, which is sine qua non in such matters and the complainant has failed to prove the same beyond reasonable doubt and in view of the aforesaid facts and circumstances and the evidence on record, this Court agrees with the view taken by the learned Magistrate. The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities. In the instant case, the accused has succeeded in rebutting the presumption, showing preponderance of probability by leading evidence and hence, onus shifts upon the complainant to prove otherwise, however, the complainant has failed to prove that the cheque was drawn towards legally enforceable debt as neither any account nor any details of amount paid by the complainant is submitted by the complainant before the trial Court. The complainant has failed to bring home the charge against accused for want of sufficient material. The findings recorded by the learned Magistrate do not call for any interference - Appeal dismissed.

Issues Involved:
1. Legally enforceable debt
2. Presumption under Sections 118(a) and 139 of the NI Act
3. Rebuttal of presumption by the accused
4. Appreciation of evidence by the trial court
5. Scope of interference in acquittal appeals

Issue-wise Detailed Analysis:

1. Legally Enforceable Debt:
The complainant alleged that the respondent borrowed ?10,57,190/- and issued a cheque which was dishonored due to "Account Closed." The trial court found that the complainant failed to prove the debt was legally enforceable. Despite maintaining an account of the respondent, the complainant did not produce any details or evidence of specific transactions. The court emphasized the necessity of proving the debt to be legally enforceable, which the complainant failed to do.

2. Presumption under Sections 118(a) and 139 of the NI Act:
Section 139 mandates a presumption that the cheque was for the discharge of any debt or other liability. However, this presumption is rebuttable. The trial court noted that the complainant did not produce sufficient evidence to substantiate the claim of a legally enforceable debt. The court referred to the decision in Basalingappa v. Mudibasappa, stating that the presumption under Section 139 is rebuttable and the onus is on the accused to raise a probable defense.

3. Rebuttal of Presumption by the Accused:
The accused successfully rebutted the presumption by showing preponderance of probability. The accused argued that the account was closed prior to the issuance of the cheque, which was substantiated by the bank statement showing the account closure on 28.02.2003, while the cheque was presented on 16.05.2003. The court found that the accused had succeeded in rebutting the presumption, shifting the onus back to the complainant, who failed to prove otherwise.

4. Appreciation of Evidence by the Trial Court:
The trial court meticulously considered the depositions and documentary evidence. The court highlighted the complainant's failure to produce the respondent's account details or any documentary evidence of the debt. The trial court's approach was found to be thorough and justified, leading to the conclusion that the debt was not legally enforceable.

5. Scope of Interference in Acquittal Appeals:
The appellate court reiterated the principles for interference in acquittal appeals. It emphasized that an appellate court should not disturb the trial court's findings unless there is manifest illegality or the conclusions are perverse. The court referred to several precedents, including Mallikarjun Kodagali and Chaman Lal, underscoring the double presumption of innocence in favor of the accused. The court concluded that the trial court's judgment did not suffer from any infirmity and upheld the acquittal.

Conclusion:
The appeal was dismissed, and the trial court's judgment of acquittal was confirmed. The complainant failed to prove the debt was legally enforceable, and the accused successfully rebutted the presumption under Section 139 of the NI Act. The appellate court found no reason to interfere with the trial court's well-reasoned judgment.

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