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2022 (4) TMI 1146 - HC - Indian LawsDishonor of Cheque - appreciation of evidence is based on sound principles regarding appreciation of evidence in the offence under the provisions of Negotiable Instruments Act, 1881 - cheque bounce case or not - HELD THAT - It is evident that it is the defence of the accused that he was going along with one Narayansa Raibagi to some village in the year 2006 and he kept signed cheque in his bag. When they were taking tea in a hotel, there was theft of his bag. According to accused, the said Narayansa has filed a civil suit against him and he has given one of the cheque to this complainant and got filed the case - There is no iota of evidence placed before the Court to show that Narayansa accompanying him in the year 2006 and he lost the cheque and the said Narayansa has misused the cheque after nearly four years of theft of cheque and got lodged the complaint. If the defence of the accused is considered, then this defence rests with his reply notice only. If at all he has lost the cheque, as stated in his explanation in the statement recorded under section 313 of Cr.P.C., he could have lodged the complaint with the police. One carbon copy of the letter stated to be addressed to the SSK bank dated 5.6.2006 is produced along with written statement. But no evidence is adduced calling upon any officials of the bank to prove his contention and to show that he has intimated the bank about theft of cheques. To whom he was giving signed blank cheques at Bhagyanagar, why they asked him blank cheques, what happened to his other cheques, mentioned in reply? No explanation is forthcoming. No bank statement is produced to show that he had any move in his bank on the date he lost the cheque, no persons were examined to prove it. If at all he has lost the cheque in the year 2006 itself, then how one cheque came in possession of this said Narayansa is also not forthcoming; why he has misused only one cheque if there are six cheques is also not forthcoming. The Hon'ble Supreme Court in a decision in TRIYAMBAK S. HEGDE VERSUS SRIPAD 2021 (9) TMI 1159 - SUPREME COURT has referred the decision of KAUSHALYA DEVI MASSAND VERSUS ROOPKISHORE KHORE 2011 (3) TMI 1491 - SUPREME COURT and has held that it is not like IPC cases wherein the sentence of imprisonment is called. On the other hand they are like a regulatory offences for recovery of the amount paid. The order of sentence of imprisonment for six months needs to be set aside by modifying it to fine of ₹ 5,000/- only and the order of payment of ₹ 5,00,000/- as compensation is to be upheld - The revision petition is allowed in part.
Issues Involved:
1. Legality of the judgment passed by the Sessions Judge in Crl.A.No.47/2014. 2. Appreciation of evidence under the Negotiable Instruments Act, 1881. 3. Financial capacity of the complainant to lend the loan. 4. Defence of the accused regarding the lost cheque. 5. Presumption under Sections 118 and 139 of the Negotiable Instruments Act, 1881. 6. Sentence imposed by the trial court and its appropriateness. Issue-wise Detailed Analysis: 1. Legality of the Judgment Passed by the Sessions Judge: The revision petition challenges the judgment of the Sessions Judge, Gadag, which acquitted the accused under Section 138 of the Negotiable Instruments Act, 1881. The High Court found the judgment of the Sessions Judge to be illegal, perverse, and not based on sound principles regarding the appreciation of evidence in cheque bounce cases. The Sessions Judge wrongly concluded that the complainant's expenditure was more than his income and that he had no such financial capacity. 2. Appreciation of Evidence under the Negotiable Instruments Act, 1881: The trial court had convicted the accused based on the evidence presented by the complainant, including the cheque, bank challan, legal notice, and postal receipts. The High Court emphasized that the complainant had successfully demonstrated the necessary ingredients under Section 138 of the Negotiable Instruments Act, 1881. The Sessions Judge, however, failed to appreciate this evidence correctly and erroneously acquitted the accused. 3. Financial Capacity of the Complainant to Lend the Loan: The High Court noted that the complainant's financial capacity was never disputed during the trial. The complainant had stated that he had sufficient income from his handloom business to lend the amount. The Sessions Judge's observation that the complainant did not produce his bank balance sheet was deemed unfounded. The High Court held that the financial capacity of the complainant was adequately established. 4. Defence of the Accused Regarding the Lost Cheque: The accused claimed that he had lost the cheque and that it was misused by the complainant. However, the High Court found no evidence to support this claim. The accused did not produce any material evidence or lodge a complaint about the lost cheque. The High Court held that the defence was improbable and not tenable. 5. Presumption under Sections 118 and 139 of the Negotiable Instruments Act, 1881: The High Court reiterated the statutory presumption in favor of the holder of the cheque under Sections 118 and 139 of the Negotiable Instruments Act, 1881. The accused admitted his signature on the cheque, and therefore, the burden shifted to him to rebut the presumption. The High Court cited several Supreme Court judgments to emphasize that mere denial of debt is insufficient to rebut the presumption. 6. Sentence Imposed by the Trial Court and Its Appropriateness: The trial court had sentenced the accused to six months of simple imprisonment and ordered a compensation of ?5,00,000/-. The High Court modified the sentence, considering the relationship between the parties and the nature of the transaction. The imprisonment was set aside, and the accused was instead sentenced to pay a fine of ?5,000/-. The compensation order of ?5,00,000/- was upheld. Conclusion: The High Court allowed the revision petition in part, setting aside the acquittal by the Sessions Judge and confirming the conviction under Section 138 of the Negotiable Instruments Act, 1881. The sentence of imprisonment was modified to a fine, and the compensation order was upheld. The judgment underscores the importance of correctly appreciating evidence and the statutory presumptions under the Negotiable Instruments Act, 1881.
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