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TMI Blog2007 (2) TMI 716X X X X Extracts X X X X X X X X Extracts X X X X ..... default. This Court [Coram: S.R. Brahmbhatt, J] had issued rule in Criminal Misc. Application No. 10617 of 2006 on 3/11/2006, which was made returnable on 17/11/2006. Shri. V.B. Patel, learned Counsel appeared for the private respondents/ original accused No. 2 to 5. He opposed the delay condonation application. It would be expedient to set out few facts leading to filing of this application. 3. The applicant had to file the complaint which came to be registered as Criminal Case No. 1744 of 2003 in the court of learned Judicial Magistrate First Class Borsad against original accused No. 1 to 4 who are private respondents No. 2 to 5 herein above for offence punishable under Section 138 of the Negotiable Instrument Act as the cheque of ₹ 11,50,000=00 allegedly issued by applicant complainant had not been honoured and the accused failed in making payment of the cheque amount to the complainant after receiving statutory notice for making payment within stipulated time. The court did not believe the case of the complainant and the JMFC Borsad acquitted the accused vide his order dated 10/03/2005 in Criminal Case No. 1744 of 2003. This complainant preferred Criminal Misc. Applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ereinafter referred to as the 'Code' for brevity] challenging the order of acquittal dated 10/3/2005 passed by learned JMFC, Borsad in Criminal Case No. 1744 of 2003 acquitting the respondents No. 2 to 5 / original accused of the charge of committing offence punishable under Section 138 of the Negotiable Instrument Act, 1881 [hereinafter referred to as 'N.I. Act for short]. 2. The brief facts leading to filing of this appeal deserve to be set out as under. 2.1 The appellant, original complainant, was constrained to file the complaint in the court of learned JMFC, Borsad against the respondent No. 2 to 5, original accused, stating that he and his firm were engaged in money-lending business and knew the accused very well as they were having business relationship with him. The complainant alleged in the complaint that on 25/4/2003 the accused came to the complainant and borrowed ₹ 11,50,000=00 for development of their business. The accused issued cheque for the payment of the said amount of ₹ 11,50,000=00 bearing cheque No. 0232241 dated 5/05/2003 from their account No. 1423 maintained in Borsad Nagarik Sahkari Bank Ltd, Borsad. The accused assured the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 10/3/2005. 3. The appellant has challenged the order of acquittal dated 10/3/2005 in the present Criminal Appeal. As this Court has noted in its order dated 28/12/2006 in Cri. Misc. Application No. 10617 of 2006, Criminal Misc. Application No. 14000 of 2006 and in Cri. Misc. Application No. 3815 of 2005, the appeal was heard at length on merits and on the basis of papers produced by respective parties. As there was consensus between the parties that the entire appeal may be decided right at this stage on the basis of the record produced before this Court by the respective parties, the appeal is decided and disposed of along with Criminal miscellaneous applications by this common order. 4. Learned Counsel Shri. Nanavaty for the appellant has submitted that the order of acquittal is erroneous and the same deserved to be quashed and set aside. Shri. Nanavaty has submitted that the trial court erred in recording the acquittal contrary to the evidence on record. 5. Shri. Nanavaty for the appellant has submitted that the order of acquittal deserves to be quashed and set aside as the respondents original accused have not disputed the issuance of cheque and signature on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iate the entire case of the prosecution resulting into the acquittal of the accused. Shri Nanavaty, relying upon the decision of the Apex Court in case of A.V. Murthy v. B.S. Nagabasavanna reported in wherein the Apex Court rejected the contention that as the money advanced was prior to four years of issuance of cheque the debit had become time barred and there exist no enforceable debt or liability, has submitted that the trial court failed in appreciating that claim of moneylender cannot be rejected only on account of his failure in producing valid license for money lending under the Bombay Money Lenders Act 1946. Shri Nanavaty submits that in the instant case the fact that the complainant and his partnership firm was engaged in money lending would be of no avail to the accused. Shri. Nanavati has further submitted that in absence of production of Money Lender s License the proceedings for recovery of the loan and advances by the Moneylender are not completely barred. Shri. Nanavati has relied upon Kanbi Harji Hira Dubasia v. Kanbi Vasta Arjan Limani reported in 1977 GLR 317 and submitted that when the plaintiff failed in producing license in money lending the suit for recovery o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Lenders Act 1946 and submitted that the suit or proceedings initiated by the money lenders without the license are not maintainable and therefore the complaint which is filed without the license for money lending by a complainant, who has time and again stated in his complaint and in his oral evidence that he himself or his firm were engaged in money lending business, was liable to be rejected in absence of any valid license for money lending. 9. Shri. Patel has invited this Court's attention to the decision of the Apex Court in case of Shop Named Kaloji Talusappa Ganga Vathi v. Khyanagouda and Ors. reported in and contended that the Courts are bound to dismiss the suits for recovery of loans when the plaintiffs were carrying on business of money lending on the date of transaction without money lending license. The Apex Court has observed that the moneylender could not have been maintained his suit without producing license for money lending. Shri. Patel has also placed reliance upon the decision of this Court in case of Ramanlal Punjalal Shah v. Paribhulabhai Haribhai reported in and submitted that, it is the duty cast upon the Court to dismiss the suit under Section 10(4) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... illegal partnership contract then the only course for the courts to pursue is to say that he is not entitled to any relief on the allegations made as the court can not adjudicate in respect of contracts which the law declares to be illegal. Shri. Patel has also relied upon a decision of the Apex Court in case of The Martin Burn Ltd v. The Corporation of Calcutta reported in 1966 S.C. 529 in support of his submission that when something is not permissible to be done under any law then it can not be done under the court's order. Thus the explanation to Section 138 of the N.I. Act clearly stipulates that the debt or other liability means a legally enforceable debt or other liability, go to show that the moneylenders claim against his borrower for recovering his dues without production of valid money lenders license would be an unenforceable claim under Section 138 of the N.I. Act. In the instant case also as the complainant who has time and again stated that he and his firm were engaged in the business of money lending, was bound to produce valid money lending license and his failure to produce the same was therefore bound to result into dismissal of the complaint. 10. Shri. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the accused was fully rebutted. 12. Shri. Patel has submitted that the case of the complainant was inherently improbable as it could be seen from the documents at exhibit-46 that the complainant and accused were having a kind of dispute which was required to be settled by and between the parties with the help of mediators. The date of settlement is immediately prior to the date of issuance of the cheque. When the account of past was required to be settled with the help of mediators and when both the sides were required to give up part of their claim, it would certainly be very improbable that right thereafter an another loan of quite a sizable amount of ₹ 11,50,000 would be advanced by the complainant to the respondents. As against this, the evidence in form of Settlement Agreement at Exhibit 46, the returned blank cheques of the accused at exhibit 37 to 45, the blank vouchers signed by the accused at Exhibit 53 to 56 go to show that the defense of the accused was quite probable. The impugned order of acquittal therefore deserves to be sustained. 13. This Court has perused all the relevant papers pertaining to the Criminal Case No. 1744 of 2003 produced by the counsels ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Court relied upon by Shri Patel would certainly go to show that when money lender fails in producing the money lenders license it is the bounden duty cast upon the court hearing the suit to dismiss the same as it is mandated in provision of Section 10(4) of the Bombay Money Lenders Act, 1946. The Courts cannot help the party in enforcing the unenforceable contract or transactions. The other decision relied upon by Shri Patel would certainly help the proposition that no court should enforce impermissible and unenforceable claim of any party. If the transaction or contract is illegal or it is prohibited under any law for the time being in force or it is repugnant to any public policy than no court should help any party to enforce it. But a question arises as to whether the complaint under Section 138 of the N.I.Act is liable to be dismissed when the complainant, a moneylender, without producing valid license of money lending, seeks to maintain his complaint against the accused borrower whose cheque, a negotiable instrument, was returned on account of insufficiency of funds in his account and who failed in making payment to the moneylender within the statutory time limit. The t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt is expressed to be payable to the order of specified person and not to him or his order it is nevertheless payable to him or his order at his option. (2) A negotiable instrument may be made payable to two or more payees jointly or it may be made payable in the alternative to one of two or some of several payees. 17. Thus a crossed and even only account payee cheque also remains negotiable instrument. The cheque is negotiable instrument unless its specifically made non-negotiable by the drawer. As it is held in National Bank v. Silke (1891) 1 QB 435, Akrokerri(Atlantic) Mines Ltd. v. Economic Bank (1904) 2 KB 465 ,Tailors Priya v. Gulabchand drawing of cheques with the words account payee or account payee only does not restrain negotiability of the cheque unless it is specifically mentioned on the instrument that Snot negotiable. The cheque in question at exhibit 26 as it appears on the face of it that the same was negotiable instrument and as such falling under the exclusion of Clause (f) of Sub-section (9) of Section 2 of the Bombay Money Lenders Act 1946. 18. In view of the aforesaid discussion this Court is unable to agree with the submission of Shri. Patel that in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Agreement dated 15/03/2003 at exhibit 46. As the complainant accepted it the cheques were exhibited as exhibit No. 37 to 45. 4. The complainant has also admitted that the blank vouchers of the accused at mark 52/1 to 52/4 which were lying with the complainant were in fact returned to the accused on account of settlement or earlier dispute recorded at exhibit 46. As the complainant admitted them these vouchers were exhibited as exhibit 53 to 56. 5. The complainant has stated that after execution of the Settlement Agreement dated 15/03/2003 on 25/04/2003 the accused borrowed a sum of ₹ 11,50,000=00 and issued a cheque bearing No. 0232241 dated 5/05/2003 for ₹ 11,50,000=00 drawn on Borsad Nagrik Sahkari Bank Ltd. Borsad from their account No. 1423 for payment of the said amount to the complainant. Thus as per the version of the complainant only within a short period of one month and ten days the complainant loaned a sizable amount of ₹ 11,50,000=00 to the accused with whom they had serious disputes which was resolved only with the help of mediators and that too after giving up part of their original claim. This version of the complainant deserves to be viewed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at who out of the four accused had come to borrow and collect the money. The complainant has also admitted that it is true that in the complaint it is not written that the accused were given money in cash. The complainant has also admitted that it is true that he has not produced any documents to show that he had available balance of ₹ 11,50,000=00 on the day when it is alleged that he gave that amount to the accused. The complainant has also admitted that it is true that in his firm the amount lying in the balance is always noted with the details of currency notes and its denomination. The complainant has also admitted that it is true that no license of money lending was held by them. 11. The complainant has also admitted that it is true that the writing on the cheque at exhibit 26 was not done in his presence though in his chief examination he says that the cheque was written in his presence. 12. At one place the complainant has stated that it is true both ₹ 11,45,000=00 and ₹ 11,50,000=00 were given to the accused. He is not explaining as to what was the exact amount in fact advanced to the accused. Nor is he explaining the discrepancy in mode of advancin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt as security for old transaction which were returned to the accused after the settlement agreement at exhibit 46. These vouchers were duly proved and exhibited at exhibit 53 to 56. 24. Thus the number ambiguity noticed in the version of complainant in respect of the mode of payment of ₹ 11,50,00000, the uncertainty in respect of the person or persons to whom it was handed over on 25/4/2003 and two figures of amount of payment i.e. ₹ 11,50,000=00 and 11,45,000=00 without any explanation for saying that story of giving of both the amounts is true, and the complainant's statement that he has not produced any proof showing that on 25/04/2003 this big amount was available with him or his firm for advancing it to the accused, the complainant's contradicting himself during his testimony on many aspects like writing on the cheque at exhibit 26, raises serious doubts in the veracity of his version. 25. This being an acquittal appeal this Court needs to bear in mind the principles laid down by the apex court in case of C. Antony v. K.G.Raghavan reported in that though this Court has all powers to appreciate the evidence, it should not substitute the findings of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of old disputes go to support the defense version that there exist no liability to the complainant and or his firm and the complainant have misused one of the signed blank cheques lying with them for falsely implicating them as they had to settle the disputes wherein both the parties had to give up part of their respective claim against each other. Thus the accused have in fact successfully discharged the initial burden of proving that cheque at exhibit 26 had not been issued by them for any legally enforceable debt or liability towards the complainant. In case of K.N. Beena (supra) there was merely denial by the accused and that was treated to be sufficient by the High Court, which was found to be insufficient proof of rebuttal by the Apex Court. There cannot be any proposition of law that the accused has to lead evidence by examining himself in witness box for rebutting the presumption under Section 139 of the N.I. Act. The accused in the present case in fact has produced material on the record, which has been duly proved and exhibited showing that they have discharged the initial burden. 28. The apex court has in case of Kundanlal Rallaram v. Custodian Evacuee Property Bom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t it was the practice of keeping blank cheques and vouchers of the accused by way of security the accused did discharge their initial burden of proving under Section 139 of the N.I. Act that the cheque at exhibit 26 was not issued against any legally enforceable debt or liability. The burden thereafter had shifted upon the complainant to prove that they had in fact advanced a sum of ₹ 11,50,000=00 or 11,45,000=00 to the accused on 25/04/2003 and the accused issued the cheque at exhibit 26 dated 5/05/2003 against the said advance only and the accused failed in making payment of the said amount within stipulated time. The Apex Court has in case of M.S. Narayan Menon @ Mani v. State of Kerala and Anr. reported in held that once the accused under Section 139 of N.I. Act shows that the cheque in question had in fact not been issued for any legally enforceable liability or debt then the burden shifts on to the complainant to prove the contrary. Thus in view of this the acquittal of the accused impugned in this appeal cannot be said to be so perverse as to result into miscarriage of justice warranting any interference under Section 378 of the Code. 31. In the result, this Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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