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TMI Blog2023 (4) TMI 121X X X X Extracts X X X X X X X X Extracts X X X X ..... pondent no.1 - original accused from the offence punishable under Section 138 of the Negotiable Instruments Act. 3.0. Before going into the merits of the case, it would be appropriate to consider the case of the complainant. The gist of the complaint as contended by the original complainant is as under: 3.1. The applicant and the respondent no.1 - original accused were friends and respondent no.1 was in need of an amount of Rs.10 lakhs to start a business. It is contended by the complainant that respondent no.1 had approached the original complainant in the month of December of 2013 seeking financial help of an amount of Rs.10 lakhs. It is further contended by the complainant that at the relevant point of time such huge amount was not available with the complainant and had assured the respondent no.1 to arrange such amount after a period of 10 days. It is the case of the complainant that on 1.11.2014 he had withdrawn an amount of Rs.5,95,000/-from his bank account and remaining amount of Rs.4,05,000/- was arranged from friends and the relatives. The complainant has claimed to have advanced an amount of Rs.10 lakhs to the respondent no.1. 3.2. Upon completion of period of two mon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fered himself in the witness box and has been cross-examined. The said oral evidence of the complainant has come on record vide Exh.7. Apart from the oral evidence, the complainant has brought on record the documentary evidence which includes the disputed cheque (Exh.10), receipt of acknowledging deposit of the amount in the bank (Exh.11), original return memo of the cheque (Exh.12), legal notice (Exh.14), Postal slip (Exh.15), acknowledgment slip (Exh.16), closing pursis (Exh.84), forwarding letter of the Bank (Exh.13), Income Tax Return for AY 2013-14 to 2016-17 (Exhs. 76 to 79) and statement of Bank Account of Bank of Baroda (Exh.80). 7. The accused on the other hand has placed on record the documentary evidence which includes Registered Post AD receipt (Exh.63), reply given by the accused to the legal notice (Exh.65) and copy of the UPC (Exh.64). The further statement of the accused has been recorded under Section 313 of the Code of Criminal Procedure. The accused has raised specific defence by submitting that complainant was one of the partner in Krishna Lease Finance and had misused the blank signed cheque of the complainant by incorporating details, the complainant has trie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly, when accused had not disputed his signature on the disputed cheque. The statutory presumption was required to be drawn in favour of the complainant as regards existence of legally enforceable debt or liability against accused. He has further submitted that it was for the drawer of the cheque to rebut such presumption by leading cogent and convincing reasons regarding consideration. He has further submitted that except for cross-examination of the complainant no material evidence has been placed on record which has resulted into rebuttal of the presumption drawn in favour of the complainant by virtue of statutory provision. In such circumstance, the trial Court ought not to have shifted the burden of proof on the complainant to prove his case beyond the reasonable doubt. He has further submitted that on irrelevant consideration, the learned Magistrate has proceeded to record the order of acquittal. 10. In support of his submissions, he has relied upon the decision of the Hon'ble Supreme Court in the case of Tedhi Singh vs. Narayan Dass Mahant reported in (2022) 6 SCC 735. By relying upon the legal principle culled out, he submitted that the complainant can only be called upon t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ur of the holder of the cheque on contrary being proved, stands shifted. This rebuttal can be pursuant to the probable defence, evidence of rebuttal or even on scrutiny of the evidence of the complainant. In the given case, applying the aforesaid principle, the Hon'ble Supreme Court proceeded to confirm the judgment and order of acquittal to avoid unwarranted conviction and mis-carriage of justice. He has further relied upon the decision of the Hon'ble Supreme Court in the case of Krishna Janardhan Bhat vs. Dattatraya G Hedge reported in (2008) 4 SCC 54 and has submitted that standard of proof so far as accused is concerned, is based on the preponderance of probabilities, inference of which can be drawn not only from the materials brought on record but also from the surrounding circumstances. As against that, the prosecution was expected to prove the case against the accused, beyond reasonable doubt. Lastly, he has relied upon the decision of this Court in the case of Bhagwandas Gangarambhai vs. Pradipkumar Hargovanbhai reported in 2022 (4) GLR 3101 and has submitted that this Court after considering the various decisions of the Hon'ble Supreme Court has held that the presumption u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance towards different transactions. By the aforesaid evidence, the accused has raised probable defence by alleging the original complainant to be one of the partner of the said Finance Company. 15. Under Section 138 of the Negotiable Instruments Act, once the cheque is issued by the drawer, a presumption under Section 139 of the Negotiable Instruments Act in favour of the holder would be attracted. Section 139 creates a statutory presumption that a cheque received in the nature referred to under Section 138 of the Negotiable Instruments Act is for the discharge in whole or in part of any debt or other liability. The initial burden lies upon the complainant to prove the circumstances under which the cheque was issued in his favour and that the same was issued in discharge of a legally enforceable debt. 16. It is for the accused to adduce evidence of such facts and circumstances to rebut the presumption that such debt does not exist or that the cheques are not supported by consideration. 17. Considering the scope of the presumption to be raised under Section 139 of the Act and the nature of evidence to be adduced by the accused to rebut the presumption, in Kumar Exports v. Sharma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall presume" as given in Section 4 of the Evidence Act, makes it at once clear that presumptions to be raised under both the provisions are rebuttable. When a presumption is rebuttable, it only points out that the party on whom lies the duty of going forward with evidence, on the fact presumed and when that party has produced evidence fairly and reasonably tending to show that the real fact is not as presumed, the purpose of the presumption is over. 20. The accused in a trial under Section 138 of the Act has two options. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the nonexistence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed. To rebut the statutory presumptions an accused is not expected to prove his defence beyond reasonable doubt as is expected of the complainant in a criminal trial. The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the court need not insist in every case that the accused should disprove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In the aforesaid process of challenge, the Hon'ble Supreme Court went to examine the process of rebuttal of presumption in the facts of the case. The Hon'ble Supreme Court while referring to its earlier judgment in the case of Basalingappa vs. Mudibasappa reported in (2019) 5 SCC 418 applied the principle of reverse onus as carved out in the decision of the Hon'ble Supreme Court in the case of Rangappa vs. Sri Mohan reported in (2010) 11 SCC 441 and held that what the accused needs to establish is a probable defence. The Hon'ble Supreme Court in para 10 and 11 further proceeded to observe as under: "10. The Trial Court and the First Appellate Court have noted that in the case under Section 138 of the N. I. Act the complainant need not show in the first instance that he had the capacity. The proceedings under Section 138 of the N. I. Act is not a civil suit. At the time, when the complainant gives his evidence, unless a case is set up in the reply notice to the statutory notice sent, that the complainant did not have the wherewithal, it cannot be expected of the complainant to initially lead evidence to show that he had the financial capacity. To that extent the Courts in our view ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceeded to hold so. It is in this peculiar facts, the Court has observed so. 20. In the present case, the accused has set up the specific defence in the reply given to the legal notice sent by the complainant. The accused has specifically raised the case of complainant being partner in a Krishna Lease Finance and the manner in which the cheque has been misused. The complainant in his cross examination has categorically admitted about defence of misuse of a signed blank cheques lying with Krishna Finance, being taken in reply to notice. He has admitted that no document about having annual income of Rs.10 lakhs is brought on record. He has clarified in fact that as he is not earning, therefore, it is not produced. No documents of savings had been brought on record. However, he has shown readiness to bring account of FY 2013 to FY 2015. He has also admitted in cross that except for signature, the date, name and name of payee appears in different hand writing. Subsequently, the complainant has brought on record Income Tax Returns filed for AY 2013-14 to 2016-17 which is exhibited at Exh. 76 to Exh.80. However, the fact remains that in none of the year, the annual income has gone beyond ..... X X X X Extracts X X X X X X X X Extracts X X X X
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