2024 (10) TMI 1121 - HC - Indian Laws

Dishonour of Cheque - presumption regarding the consideration - failure to rebut the presumption by providing satisfactory evidence - HELD THAT - It was laid down by the Hon ble Supreme Court in MALKEET SINGH GILL VERSUS THE STATE OF CHHATTISGARH 2022 (7) TMI 1455 - SUPREME COURT that the revisional court is not an appellate jurisdiction and it can only rectify the patent defect, errors of jurisdiction or the law. The accused has not disputed the taking of the loan, the issuance of the cheque and his signatures on the cheque. It was laid down by this Court in NARESH VERMA VERSUS NARENDER CHAUHAN 2019 (10) TMI 1578 - HIMACHAL PRADESH HIGH COURT that where the accused had not disputed his signatures on the cheque, the Court has to presume that it was issued in discharge of legal liability and the burden would shift upon the accused to rebut the presumption. In the present case, the accused did not lead any evidence to rebut the presumption. His plea that he had deposited the amount will not help him because the amount was not proved to have been deposited towards the present loan transaction. Thus, the learned Courts below had rightly held that the cheque was issued in discharge of the legal liability. The accused failed to pay the amount even within 15 days of the receipt of the summons from the Court. It was laid down in CC. ALAVI HAJI VERSUS PALAPETTY MUHAMMED 2007 (5) TMI 335 - SUPREME COURT that the person who claims that he had not received the notice has to pay the amount within 15 days from the date of the receipt of the summons from the Court and in case of failure to do so, he cannot take the advantage of the fact that notice was not received by him. The accused had issued a cheque of ₹ 70,000/- on 18.02.2019. Learned Trial Court imposed the sentence on 14.10.2022 after the lapse of more than three years. The complainant had to incur the legal expenses and he had to engage a counsel for that. He also suffered a loss of interest and was entitled to be compensated for the same. It was laid down by the Hon ble Supreme Court in M/S. KALAMANI TEX ANR VERSUS P. BALASUBRAMANIAN 2021 (2) TMI 505 - SUPREME COURT that the Courts should uniformly levy a fine up to twice the cheque amount along with simple interest at the rate of 9% per annum - Hence, the amount of ₹ 1,00,000/- as compensation cannot be said to be excessive and no interference is required with the sentence imposed by the learned Trial Court. The present revision fails and same be dismissed.

Summary

Issues Involved:

1. Whether the accused was guilty of committing an offence punishable under Section 138 of the Negotiable Instruments Act (NI Act).
2. Whether the judgments of the lower courts were based on conjectures, surmises, and presumptions.
3. Whether the accused successfully rebutted the presumption under Section 139 of the NI Act.
4. Whether the sentence and compensation imposed by the Trial Court were excessive.

Detailed Analysis:

1. Offence under Section 138 of the NI Act:

The complainant alleged that the accused issued a cheque for Rs. 70,000, which was dishonoured due to insufficient funds. Despite receiving a valid notice of demand, the accused failed to pay the amount. The Trial Court found sufficient evidence to summon the accused and subsequently convicted him under Section 138 of the NI Act, sentencing him to six months of simple imprisonment and a compensation of Rs. 1,00,000. This conviction was upheld by the Appellate Court, which concurred with the findings of the Trial Court, noting that the issuance of the cheque was undisputed and the accused failed to rebut the presumption of consideration.

2. Judgments Based on Conjectures and Presumptions:

The accused contested the judgments, claiming they were based on conjectures and presumptions, and that the courts misinterpreted the evidence. The accused argued that payments made to the complainant were for other transactions and that a blank security cheque was misused. However, the courts found that the accused admitted to taking a loan and issuing the cheque. The accused's claims of repayment were not substantiated with evidence, and the courts determined that the transactions cited by the accused did not relate to the loan in question.

3. Presumption under Section 139 of the NI Act:

The courts relied on the presumption under Section 139 of the NI Act, which assumes that the cheque was issued in discharge of a debt or liability unless proven otherwise. The accused admitted to issuing the cheque and did not provide evidence to rebut this presumption. The courts referred to several precedents, including Naresh Verma vs. Narinder Chauhan and APS Forex Services (P) Ltd. v. Shakti International Fashion Linkers, which emphasize that once the issuance of a cheque is admitted, the burden shifts to the accused to prove the contrary. The accused's failure to present evidence to rebut the presumption led to the upholding of the conviction.

4. Sentence and Compensation:

The Trial Court sentenced the accused to six months of simple imprisonment and imposed a compensation of Rs. 1,00,000. The courts justified the sentence, citing the deterrent nature of Section 138 of the NI Act, as discussed in Bir Singh v. Mukesh Kumar. The compensation was deemed appropriate, considering the legal expenses and loss of interest incurred by the complainant. The courts referenced Kalamani Tex v. P. Balasubramanian, which supports levying fines up to twice the cheque amount with interest, affirming that the compensation was not excessive.

Conclusion:

The revision petition was dismissed, as the courts found no merit in the accused's arguments. The judgments and orders of the lower courts were upheld, confirming the conviction under Section 138 of the NI Act and the imposed sentence and compensation.