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TMI Blog2017 (8) TMI 453X X X X Extracts X X X X X X X X Extracts X X X X ..... e was duly received by the petitioner but he did not make any payment. 3. The petitioner/accused was summoned and thereafter notice of accusation was put to him to which he pleaded not guilty and claimed trial. The complainant/respondent was directed to produce his evidence. In order to prove his case, the complainant examined four witnesses in all and closed his evidence. After completion of evidence, entire incriminating circumstances and evidence were put to the petitioner. The petitioner/accused in his defence examined three witnesses and closed his evidence. 4. The learned trial Court after evaluating the evidence and hearing the parties, convicted and sentenced the accused/petitioner to undergo rigorous imprisonment for three months and imposed a fine of Rs. 30,000/- out of which Rs. 20,000/- was directed to be paid to the complainant/respondent as compensation and in default of payment of fine, the accused was directed to further undergo simple imprisonment of two months. The petitioner filed the appeal before the learned Additional Sessions Judge, however, the same were dismissed vide judgment dated 24.04.2009, constraining the petitioner to file the instant revision peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of law by the trial court, that the High Court is empowered to set aside the order of the acquittal and direct a re-trial of the acquitted accused. From the very nature of this power it should be exercised sparingly and with great care and caution. The mere circumstance that a finding of fact recorded by the trial court may in the opinion of the High Court be wrong, will not justify the setting aside of the order of acquittal and directing a re-trial of the accused. Even in an appeal, the Appellate Court would not be justified in interfering with an acquittal merely because it was inclined to differ from the findings of fact reached by the trial Court on the appreciation of the evidence. The revisional power of the High Court is much more restricted in its scope". 12. In Ramu @ Ram Kumar vs. Jagannath, AIR 1991, SC 26, Hon'ble Supreme court cautioned the revisional Courts not to lightly exercise the revisional jurisdiction at the behest of a private complainant. 13. In State of Karnataka vs. Appu Balu, AIR 1993, SC 1126 = II (1992) CCR 458 (SC), the Hon'ble Supreme Court held that in exercise of the revisional powers, it is not permissible for the Court to re-appreciate the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In a sense, it is a non-speaking judgment". 18. Before adverting to the respective contentions of the learned counsel appearing on either side, it is beneficial to quote Section 118(a), Section 138 and Section 139 of the Act. These Sections read as under:- "S.118 Presumptions as to negotiable instruments.- Until the contrary is proved, the following presumptions shall be made:- (a) of consideration "that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration." "S.138 Dishonour of cheque for insufficiency, etc., of funds in the account:- Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provision of giving sanctity to the instruments of credit which could be deemed to be convertible into money and easily passable from one person to another. In the absence of such instruments, including a cheque, the trade and commerce activities, in the present day world, are likely to be adversely affected as it is impracticable for the trading community to carry on with it the bulk of the currency in force. The negotiable instruments are in fact the instruments of credit being convertible on account of legality of being negotiated and are easily passable from one hand to another. To achieve the objectives of the Act, the legislature has, in its wisdom, thought it proper to make such provisions in the Act for conferring such privileges to the mercantile instruments contemplated under it and provide special penalties and procedure in case the obligations under the instruments are not discharged. The laws relating to the Act are, therefore, required to be interpreted in the light of the objects intended to be achieved by it despite there being deviations from the general law and the procedure provided for the redressal of the grievances to the litigants. Efforts to defeat the obje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2002) 2 SCC 745, the Hon'ble Supreme Court has explained the offence under Section 138 of the Act, as under:- "10. On a reading of the provisions of Section 138 of the NI Act it is clear that the ingredients which are to be satisfied for making out a case under the provision are:- (i) a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account for the discharge of any debt or other liability; (ii) that cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier; (iii) that cheque is returned by the bank unpaid, either because the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank. (iv) the payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within 15 days of the receipt of information by him from the bank regarding the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the help of presumptions of law or fact unless the accused adduces evidence showing the reasonable possibility of the non-existence of the presumed fact. 22. In other words provided the facts required to form the basis of a presumption of law exists, no discretion is left with the Court but to draw the statutory conclusion, but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary. A fact is said to be proved when, "after considering the matters before it the Court either believes it to exist or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists". Section 3: Evidence Act. Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the Court in support of the defence that the Court must either believe the defence to exist or consider its existence to be reasonably probably, the standard of reasonability being that of the 'prudent man.' 23. Judicial statements have differed as to the quantum of rebutting evidence required. In Kundan Lal Rallaram v. Custodian, Evacuee Pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent evidence that there was no debt or liability. It is apt to reproduce para 7, which reads thus:- "7. In this case admittedly the 1st respondent has led no evidence except some formal evidence. The High Court appears to have proceeded on the basis that the denials/averments in his reply dated 21.5.1993 were sufficient to shift the burden of proof on to the appellant complainant to prove that the cheque was issued for a debt or liability. This is an entirely erroneous approach. The 1st respondent had to prove in the trial, by leading cogent evidence, that there was no debt or liability. The 1st respondent not having led any evidence could not be said to have discharged the burden cast on him. The 1st respondent not having discharged the burden of proving that the cheque was not issued for a debt or liability, the conviction as awarded by the Magistrate was correct. The High Court erroneously set aside that conviction." 25. In Rangappa v. Mohan, AIR 2010 SC 1898, the Hon'ble Supreme Court held that existence of legally enforceable debt or liability as a matter of presumption under Section 139, it is apt to reproduce para 14 of the judgment, which reads thus:- "14. In light of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her own." 26. The object underlying Section 138 of the Act has been lucidly explained by Hon'ble three judges of the Hon'ble Supreme Court in MSR Leathers v. S. Palaniappan and another, (2013) 1 SCC 177, in the following manners:- "29. It is trite that the object underlying Section 138 of the Act is to promote and inculcate faith in the efficacy of banking system and its operations, giving credibility to negotiable instruments in business transactions and to create an atmosphere of faith and reliance by discouraging people from dishonouring their commitments which are implicit when they pay their dues through cheques. The provision was intended to punish those unscrupulous persons who issued cheques for discharging their liabilities without really intending to honour the promise that goes with the drawing up of such a negotiable instrument. It was intended to enhance the acceptability of cheques in settlement of liabilities by making the drawer liable for penalties in case the cheque was dishonoured and to safeguard and prevent harassment of honest drawers. (ISee Mosaraf Hossain Khan v. Bhagheerathua Engg. Ltd., (2006) 3 SCC 658, C.C. Alavi Haji v. Palapetty Muhammed, (2007) 6 S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 138 treats dishonoured cheque as an offence, if the cheque has been issued in discharge of any debt or other liability. The Explanation leaves no manner of doubt that to attract an offence under Section 138, there should be a legally enforceable debt or other liability subsisting on the date of drawal of the cheque. In other words, drawal of the cheque in discharge of an existing or past adjudicated liability is sine qua non for bringing an offence under Section 138. If a cheque is issued as an advance payment four purchase of the goods and for any reason purchase order is not carried to its logical conclusion either because of its cancellation or otherwise, and material or goods for which purchase order was placed is not supplied, in our considered view, the cheque cannot be held to have been drawn for an existing debt or liability. The payment by cheque in the nature of advance payment indicates that at the time of drawal of cheque, there was no existing liability. 15. The above reasoning of the Delhi High Court is clearly flawed inasmuch as it failed to keep in mind the fine distinction between civil liability and criminal liability under Section 138 of the NI Act. If ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lity in discharge of which the dishonoured cheques had been issued was of second firm. The second firm which owed the liability was not impleaded nor even its proprietor was impleaded in that capacity. It was also found therein that the first firm had never taken on the liability of the second firm and thus the complaint was held to be not maintainable for mis-joinder of parties. However, this is not the fact situation obtaining in the instant case, therefore, the aforesaid judgment is not at all applicable to the facts of the present case. 32. At this stage, it would be necessary to reiterate that the learned Courts below have concurrently come to the findings that the petitioner had purchased land from the complainant being power of attorney of the owner of the land, however, he happened to have occupied more land than purchased by him and when this fact was detected, the parties entered into a compromise which was reduced in writing vide Ex. CW2/X dated 4.7.1999, wherein it was agreed that the petitioner/accused would make payment of the land un-authorisedly occupied by him. As per the compromise, the petitioner had issued a cheque bearing No. RTQ 034402, dated 31.12.1999 Ex.CW ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the accused that at the time of encashment of cheque worth Rs. 53,200/- there was insufficient funds. He stated that he had written the compromise Ex.CW2/X. He also admitted that it was agreed that 38 sq. metres of land of Parkash Chand and 32 sq. metres land of Prabhi Devi was encroached by the petitioner regarding which the petitioner had issued post dated cheques in favour of the respondent and witnesses had signed the compromise. 38. DW3 Anil Gupta, who was present at the time of compromise Ex.CW2/X stated that petitioner has constructed his house and regarding the excess land he had issued post dated cheques in favour of the respondent, but subsequently he was told by the petitioner that the respondent could not execute the Registry, therefore, he got the payment stopped. In his crossexamination, this witness stated that he was working as Senior Manager in the bank and even DW2 Dalip Thakur was working in the same bank. He admitted that the compromise was admitted by both the parties and thereafter was signed by the parties as well the witnesses and it was in lieu thereof the cheques had been issued. He further stated that there were about 5-7 persons present at the time whe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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