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TMI Blog2021 (3) TMI 1228X X X X Extracts X X X X X X X X Extracts X X X X ..... t. P1 cheque. On presentation of the cheque for collection, it was returned due to 'insufficiency of funds' in the account of the accused. Statutory notices were issued in the residential as well as office address of the accused. In spite of receipt of notices, accused neither responded nor paid up the money. The complainant was examined as Pw1 and Exts. P1 to P6 marked and the accused examined himself as Dw1 and the Branch Manager as Dw2, marking Ext. D1 to D7 in defence. 3. In Divakaran a learned Single Judge held that the nature and date of transaction and the date of issuance of cheque are material facts; which if not disclosed in the statutory notice, the doors of the Court would be closed for such 'fortune seekers'. It was held that an accused, in a complaint filed under Sec. 142 of the Act, is entitled to know before trial the material particulars of the accusation levelled; suppression of which would entail acquittal, without anything more. 4. Whereas in Surendra Das another learned Single Judge of this Court held that omission or error in the notice to state the nature of debt or liability does not render it invalid. It was noticed that no form is prescri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rlier. Proviso (b) brings in a condition of demand being made in writing to the drawer within 30 days of receipt of information of dishonour, prior to the filing of the complaint. Proviso (c) enables the drawer to pay the amount covered by the cheque within 15 days failing which alone the complainant gets a right to prosecute. Proviso (c) and the Explanation that the debt or liability should be legally enforceable, are safeguards for the drawer. Section 139 is the heart and soul of the newly introduced scheme which statutorily provides a presumption in favour of the holder that the cheque is received for discharge of a debt or other liability, in whole or part; unless the contrary is proved. The compelling argument against Divakaran is that it renders otiose Section 139. 10. Sec. 140 of the Act expressly bars the drawer from taking a defence that at the time of drawing the cheque, it was without knowledge (anticipating) of dishonour on presentation. That is a protection to the payee prohibiting an unnecessary defence to wriggle out from the liability once the cheque is issued in the account maintained with a banker. 11. Sec. 142 of the Act deals with the procedure for taking cogn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urn of the cheque as unpaid. It is obvious from the scheme of S. 138 that each one of the ingredients flows from a document which evidences the existence of such an ingredient. The only other ingredient which is required to be proved to establish the commission of an offence under S. 138 is that in spite of the demand notice referred to above, the drawer of the cheque failed to make the payment within a period of 15 days from the date of the receipt of the demand. A fact which the complainant can only assert but not prove, the burden would essentially be on the drawer of the cheque to prove that he had in fact made the payment pursuant to the demand." 13. What emerges from the above is that, a complaint filed under Sec. 138 of the Act should contain factual allegations regarding the five ingredients underlined in the extract above. Those are : (i) the cheque drawn in a valid account by the holder, (ii) its presentation within six months or validity period; whichever is earlier, (iii) dishonour, (iv) demand by the payee or holder in due course, (v) which demand is within 30 days of dishonour. It is also held that all these ingredients are imbibed in Sec. 138 of the Act itself. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t for his personal needs and in repayment issued a cheque, which stood dishonoured, on account of insufficient funds. The defence of the accused, a villager, was that he used to supply milk at the dairy of the complainant's father, to ensure which advance payments were made. The dairy owner obtained blank cheques from the suppliers as security; to prove which an independent witness was also examined. In the course of settlement of accounts the accused asked for return of the blank cheque issued which led to an altercation leading to the accused lodging an FIS against the assault committed on him. As a counter blast, the cheque was presented for encashment. In the said fact situation, it was observed that although the respondent failed to prove that the cheque was not signed by him, there appears to be a glaring loophole in the case of the complainant who failed to establish the cheque having been issued by the accused towards repayment of a personal loan. There the complaint was lodged by the complainant without specifying the date on which loan was advanced. The complainant himself admitted that the cheque was issued assuring repayment of the loan in two months and the cheque ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f cheque, be disclosed in the notice when the statute does not provide for it. It is also to be noted in this context that the offence u/s. 138 of the Act is an offence which would be attracted on the ingredients above referred being satisfied. The statute also provides a presumption in favour of the holder which cannot be rendered otiose. We are, with utmost respect, unable to agree with the requirement mandated by Divakaran that the nature of the transaction should be disclosed in the notice; as that does not appear to be the correct position of law. 20. Now coming to the merits of the present Appeal. The averment in the notice and complaint is about a business transaction between the complainant and accused. The complainant alleges that an amount of Rs. 30,00,000/- is due from the accused out of the business transaction. In discharge of that liability, Ext. P1 cheque for Rs. 30,00,000/- was issued on 2.7.1997. There is no contention about violation of statutory formalities prior to the institution of the complaint, except with regard to the defect in notice sent, which as per our earlier discussion holds no merit. 21. According to the learned counsel for the complainant, since ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ign country and the Bank is an authorised dealer in foreign exchange. If the cheque was honoured, the payment would have been in Indian currency by the authorised dealer, the Bank, for which there would definitely have been corresponding inward remittance in the non-resident account. 25. Triveni Kodkani & Ors. v. Air India Ltd. & Ors. [: 2020 (3) KHC 50 SC] and Forasol v. O.N.G.C. (AIR 1984 SC 241) held that a sum of money expressed in a foreign currency can legitimately be claimed by the plaintiff in a suit in India after converting the same to equivalent value of Indian currency either on the exchange rate prevailing on the date when it became due or that on the date of institution of suit. In the event of the claim having been made in foreign currency the rate applicable would be as on the date of judgment. The contention of the accused with regard to the bar under Section 9 of FERA cannot be accepted. 26. Ext. P3 is the copy of the lawyer notice sent by the complainant to the accused in which the specific allegation is that an amount of Rs. 30,00,000/- is due from the accused to the complainant in the business transaction between them. In the complaint also the specific alleg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed that all records in connection with the business is kept by the accused and he has no document at all in connection with that business. That would lead to an inference as suggested during cross-examination of the complainant that actually Pw1 was not having any business transaction with Dw1 and that is why he was not having any records in connection with the same. The nature of business of the accused is said to be purchase of visa from Arab Nationals, who alone can sponsor foreign nationals, which, for a minor profit would be given to seekers of jobs in Gulf countries. But he could not state any of such visa transaction of the accused or himself with a third party. The prevarication of the complainant would probabilise the defence version that there was no joint business conducted by them. 31. On further cross-examination, PW1 would state that he advanced 1¼ lakhs Riyal to the accused in the year 1993, 75000 Riyal in the year 1995 and 1¼ lakhs Riyal again was advanced in the year 1997. But admittedly there is no document to prove the above transactions. It is very curious in this context to note that accused admits during cross-examination that in the year 1993 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccused in the year 1993, 1995 and 1997 respectively, as claimed by him. Hence the source of money is also not proved. 33. At the instance of the accused, DW2-the Manager of SBI, Ramanattukara was examined. Ext. D1 series letters were issued from the Bank, Ext. D2 is his specimen signature and Ext. D3 is the letter of the accused to the Branch Manager of SBI, Ramanattukara intimating the change of his signature. Ext. D4 is the certified extract of the account of the accused kept in the Bank during July 1986 to October 1994. Ext. D4 would go to show that cheque Nos. 623381 and 623382 were drawn by the accused in August 1986 and September 1994 respectively and that account was closed on 22.3.1995 and it is also stated to have been reopened. Ext. P1 cheque (No. 623387) is in the same series of the above two cheque leaves. Ext. D6 series is a certified extract of cheque issue register kept in the Bank. 34. As per Ext. D6 cheque Nos. 826001 to 826025 had been issued on 21.6.1995, cheque Nos. 804821 to 804840 had been issued on 11.8.1999 and cheque Nos. 804701 to 804720 had been issued on 19.8.1999. DW2 deposed that cheque Nos. 623381 to 623400 had been issued on 28.9.1995. But that evi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fatal to the prosecution and unless there is a satisfactory explanation it would enable the court to conclude, presumption under Sec. 139 having been rebutted. John K Abraham found that serious lacuna in the evidence of complainant strikes at the root of a complaint. Krishna Janardhan Bhatt held that in order to rebut the presumption under Sec. 139 the accused need not examine himself and he may discharge the burden on the basis of the materials already brought on record. 36. ANSS Rajasekhar found that when evidence elicited from complainant during cross-examination creates serious doubt about the existence of debt and about the transaction and the complainant fails to establish the source of funds the presumption under Section 139 is rebutted and the defence case stands probabilised. APS Forex Services Pvt. Ltd. held that whenever the accused questioned the financial capacity of the complainant in support of his probable defence, despite the presumption under Sec. 139, onus shifts again on the complainant to prove his financial capacity. Here we have already discussed in detail the failure of the complainant to prove the source of money alleged to have been advanced. 37. Facts, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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