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TMI Blog2010 (1) TMI 1282X X X X Extracts X X X X X X X X Extracts X X X X ..... establish her case against the accused so as to bring home the guilt on the part of the accused. The cheque in question was not issued to discharge loan enforceable according to law and, therefore, notwithstanding that it was dishonoured by nonpayment of loan remaining unpaid despite demand notice in writing, it cannot came within the purview of Section 138 of the N.I. Act. As such, it would not be possible for this Court to reverse the acquittal and to fasten criminal liability upon the accused, u/s 138 of the N.I. Act. The Appeal is, therefore, dismissed. - A.P. Bhangale, J. For Appellant: P.K. Mishra, Adv. For Respondents: None JUDGMENT A.P. Bhangale, J. 1. This Appeal at the instance of original complainant, is directed against the judgment and order dated 26th March, 2009 passed by learned Judicial Magistrate First Class, Nagpur in Criminal Complaint Case No. 9037/2007, whereby the respondent accused was acquitted of the charge under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the N.I. Act ). 2. The facts in nutshell which gave rise to this appeal are: The complainant claimed that she is carrying on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e trial Court for offence punishable under Section 138 of the N.I. Act, since the accused had admitted issuance of cheque under his signature, which was returned dishonoured and remained unpaid. It is further contended that the complainant was not bound to produce money lending license in operation. Learned Advocate for the appellant submitted that the accused ought to have been held guilty. According to learned Advocate for the appellant, mere nonproduction of money lending license in the trial Court, was cited as the prime reason for acquitting the accused and, therefore, judgment and order impugned, be set aside. 6. None appeared for the respondent at the time of hearing of this Appeal. 7. In Krishna Janardhan Bhat v. Dattatraya G. Hegde AIR 2008 SC 1325 , the Apex Court in Para No. 20 observed that Section 138 of the N.I. Act has three ingredients, viz: (i) that there is a legally enforceable debt; (ii) that the cheque was drawn from the account of bank for discharge in whole or in part of any debt or other liability which presupposes legally enforceable debt; and, (iii) that the cheque so issued had been returned due to insufficiency of funds. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the proceedings under Section 138 of the said Act, because the explanation to the penal provision is abundantly clear that the dishonoured cheque must have been received by the complainant against a legally enforceable debt or liability. 9. The complainant in the present case, is a money lender who had advanced loan to the accused on the basis of the two promissory notes dated 3.2.2006 and 8.4.2006 respectively for loan of ₹ 18,000/- and ₹ 19,000/- respectively, at interest at the rate of 21 per cent per annum. It is thus case of the complainant that the accused had issued cheque No. 767789 drawn upon Canara Bank, Sadar Bazar, Nagpur for ₹ 40,000/- towards repayment of loan amount and interest. Thus, it was incumbent upon the complainant to establish the fact that she held valid money lending license in accordance with the provisions of Bombay Money Lenders Act, 1946 for the relevant period of the transaction. The complainant money lender did not produce such a valid money lending license at the time when complaint was instituted nor till it is decided although required. Furthermore, no such valid money lender's license is produced even during pendency of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder against her borrower without production of valid and operative money lending license covering period of transaction was unenforceable claim under Section 138 of the N.I. Act was bound to be dismissed. The complainant moneylender despite availing of sufficient opportunity in the trial Court could not produce valid and operative money lending license at the time of transaction of loan, hence dismissal of complaint can not be faulted as the complainant failed to establish legally enforceable debt or liability of the accused. Section 5 of the Bombay Money Lenders Act prohibits business of money lending except in accordance with terms and conditions of money lending license. In the present case, it was claimed that the loans were advanced at interest on the basis of two promissory notes executed in front of a guarantor. Thus, when transaction of money lending without valid license was prohibited by law, no court can help or assist a party money lender to enforce or recover a claim, except in accordance with law i.e. the Bombay Money Lenders Act, 1946 in this case. The complainant withheld important document without any explanation; hence presumption arose against the complainant in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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