Madras High Court
B.Uma Maheswari vs Petchiammal on 23 February, 2015
Author: R.Mala
Bench: R.Mala
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 23.02.2015 CORAM THE HONOURABLE MS.JUSTICE R.MALA Crl.A.No.92 of 2008 Judgment reserved on: 16.02.2015 Judgment pronounced on: 23.02.2015 B.Uma Maheswari .. Appellant/Complainant Vs. Petchiammal .. Respondent/Accused Prayer: Criminal Appeal is filed under Section 378 of Cr.P.C., against the judgment of acquittal dated 29.11.2007 made in C.C.No.127 of 2006 on the file of the learned Judicial Magistrate No.I, Udumalpet. For Appellant : Mr.R.Lakshmi Narasimhan For Respondent : Mr.M.N.Balakrishnan J U D G M E N T
This Criminal Appeal arises out of the judgment of acquittal dated 29.11.2007 made in C.C.No.127 of 2006 on the file of the learned Judicial Magistrate No.I, Udumalpet.
2.The appellant as a complainant preferred a private complaint under Section 138 of Negotiable Instruments Act (hereinafter called as the Act) stating that the respondent/accused has borrowed a sum of Rs.1,75,000/- on 15.10.2004 and executed a promissory note. When the appellant demanded the money, the respondent paid the interest and issued Ex.P1 cheque dated 06.02.2006 for the principal amount. When the appellant presented the cheque for encashment, it was returned as "account closed" as per return memo Ex.P2. So the appellant issued Ex.P3 statutory notice to the respondent on 08.02.2006 and the acknowledgment card was marked as Ex.P4. The respondent after receiving notice, neither she sent any reply nor repaid the amount. Therefore, the appellant/complainant was constrained to file a private complaint against the respondent/accused under Section 138 of the Act.
3.The trial Court has taken cognizance of an offence, after following the procedure and recording sworn statement. Since the accused pleaded not guilty, the trial Court examined P.W.1 and marked Exs.P1 to P4 on the side of the complainant. No oral and documentary evidence were let in on the side of the respondent. The trial Court after considering the oral and documentary evidence, acquitted the accused for the offence under Section 138 of the Act.
4. Challenging the judgment of acquittal passed by the trial Court, learned counsel for the appellant/complainant submitted that the respondent/accused has admitted the issuance of cheque and hence, the appellant is entitled to invoke presumption under Section 139 of the Act that the cheque was issued by the respondent for discharging legally subsisting liability, which is a rebuttable presumption. But the trial Court without considering the same, has held that the appellant has no source of income to lend money and she has not produced the promissory note and even she has not assigned any reason as to why she has not produced the same and on that basis, the trial Court acquitted the respondent/accused. Since the respondent has not rebutted the presumption under Section 139 of the Act, the onus is not shifted to the appellant/complainant and that factum was not considered by the trial Court. It is further submitted that even the statutory notice has been issued by the appellant, the respondent has not sent any reply and that factum was also not considered by the trial Court. Hence, he prayed for allowing this appeal. To substantiate his arguments, he relied upon the following decisions:
(i)(2010) 11 SCC 441 (Rangappa v. Sri Mohan);
(ii)2010 (3) MWN (Cr.) DCC 72 (Spenser David v. Virjin Mary);
(iii)2002-1-L.W.-(Crl.) 271 (Y.Sreelatha @ Roja v. Mukanchand Bothra);
5.Resisting the same, learned counsel for the respondent/accused submitted that P.W.1/appellant admits that on the basis of the promissory note given by the respondent, she has given a loan to her. But she has not produced the same and she has also not proved her source of income. No prudent man has handed over the cheque without receiving money only after receipt of cheque. However, issuance of cheque has been admitted by the respondent that she has given the same only as a security for the purpose of taking prize money in the chit transaction. So the trial Court considered all the aspects in proper perspective and came to the correct conclusion. Hence, he prayed for dismissal of the appeal.
6.Considered the rival submissions made on both sides and perused the materials available on record.
7.The case of the appellant/complainant is that the respondent herein had borrowed a sum of Rs.1,75,000/- from her on 15.10.2004 and executed a promissory note. When she demanded the same, the respondent issued Ex.P1 cheque dated 06.02.2006 for Rs.1,75,000/-. When the appellant/complainant presented the cheque for encashment, it was returned as account closed as per Ex.P2 return memo. So the appellant issued Ex.P3 statutory notice on 08.02.2006 and the acknowledgment card was marked as Ex.P4. After receipt of notice, the respondent neither sent any reply nor repaid the amount. Therefore, the appellant/complainant preferred a private complaint against the respondent/accused under Section 138 of the Act.
8.On perusal of records, it reveals that issuance of cheque and signature in the cheque was admitted by the respondent. So the appellant is entitled to invoke presumption under Sections 118 and 139 of the Act that the cheque was issued by the respondent for discharging legally subsisting liability. It is true, it is rebuttable one and it is the duty of the respondent to rebut the presumption either by way of letting witness or by cross-examining P.W.1.
9.At this juncture, it is appropriate to consider the following decisions relied upon by the learned counsel for the appellant.
(i) In (2010) 11 SCC 441 (Rangappa v. Sri Mohan), wherein it was held that bare denial of the passing of the consideration apparently does not appear to be any defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the plaintiff. In para-26 to 28, it was stated as follows:
26. In light of these extracts, we are in agreement with the respondent-claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant.
27.Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused/defendant cannot be expected to discharge an unduly high standard or proof.
28.In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under Section 139, the standard of proof for doing so is that of `preponderance of probabilities'. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own.
(ii) In 2010 (3) MWN (Cr.) DCC 72 (Spenser David v. Virjin Mary), it was held that for establishing the requirements in Section 138 of the Act, there is no burden on the part of the complainant to prove before the Court that the entire details of the transaction resulting in issuance of cheque. Further, it was held that there is no requirement that the complainant must specifically allege in the complaint that there was a subsisting liability. The burden of proving that there was no existing debt or liability was on the respondents. This they have to discharge in the trial. It is well settled that where the view taken by the trial Court in acquitting the accused is extremely perverse and is not reasonably sustainable on the evidence on record, then the appellate Court can interfere with such an order of acquittal and set at naught the injustice done to the parties concerned. On that basis, the learned counsel for the appellant submits that the respondent herein has not let any rebuttable evidence, but the trial Court has illegally shifted onus on the appellant to prove that the cheque was issued by the respondent for discharging legally subsisting liability.
(iii) In 2002-1-L.W.-(Crl.) 271 (Y.Sreelatha @ Roja v. Mukanchand Bothra), it was held that there is presumption under Sections 118 and 139 of the Act. In para-27 to 32, it was held as follows:
27. Thus, Sections 118, 138 and 139 of the Negotiable Instruments Act would require that the Court shall presume the liability of the drawer of the cheques for the amount for which the cheques were drawn on accepting the consideration.
28.Therefore, it is obligatory on the Court to raise this presumption in every case where the factual presumption has been established. Such a presumption is a presumption of law, as distinguished from a presumption of fact which describes provisions by which the court may presume a certain state of affairs.
29.In other words, when the prosecution provided the facts required to form a basis for presumption, no discretion is left with the Court but to draw the statutory conclusion, in favour of the complainant. In the case of a discretionary presumption, the presumption if drawn may be rebutted by an explanation which might reasonably be true and which is consistent with the innocence of the accused.
30. In the case of a mandatory presumption the burden on the accused person would not be light, as one cannot be held to be discharged merely by reason of the fact that the explanation offered by the accused is reasonable and probable.
31. The words unless the contrary is proved contained in Sections 118 and 139 of the Negotiable Instruments Act would make it clear that the presumption has to be rebutted by 'proof' and not by a bare explanation, which is merely plausible. Unless the explanation is supported by proof, the mandatory presumption created by the provision cannot be said to be rebutted.
32. It is contended by the learned counsel for the accused that the complainant received several cheques and several promissory notes from the accused and her brother and the same were misused, even though the entire amount of loan had been discharged.
10.Considering the above decisions, I am of the view, once the respondent/accused has admitted the signature in the cheque and issuance of cheque to the holder, the holder of the cheque is entitled to invoke presumption under Sections 118 and 139 of the Act. In the case on hand, the appellant is entitled to invoke presumption that Ex.P1 cheque was issued for discharging legally subsisting liability.
11.Now this Court has to decide whether the presumption under Section 139 of the Act is rebutted by the respondent/accused? It is true, the respondent/accused has proved the defence by preponderance of probabilities either by way of examining any witness on her side or cross-examining the complainant. Admittedly, no oral and documentary evidence were let in by the respondent/accused. But she cross-examined the appellant/P.W.1.
12.In the complaint itself, P.W.1/appellant stated that the respondent borrowed a sum of Rs.1,75,000/- from the appellant on 15.10.2004 agreeing to repay the same with interest at the rate of 12% per annum and executed promissory note. In para-3 of the complaint, it was specifically stated that after she demanding the amount only, the respondent had issued Ex.P1 cheque dated 06.02.2006 for Rs.1,75,000/-. When the appellant presented the cheque for encashment, it was returned as 'account closed'.
13.P.W.1/complainant in her cross-examination, has stated that at the time of borrowing money, the respondent herself brought the promissory note, but the appellant does not know who has written the same.
14.P.W.1 in her proof affidavit, stated that the respondent after paying interest, issued Ex.P1 cheque dated 06.02.2006 and had taken back the promissory note. In this aspect, the respondent has not cross-examined the appellant. The appellant specifically deposed that the respondent herself brought the promissory note and the appellant is unable to give the name of scribe and attestor of the promissory note, since the appellant/complainant is house wife. But no suggestion was posed to the appellant that the respondent has not executed the promissory note in favour of the appellant. In such circumstances, the trial Court has committed an error in accepting the defence raised by the respondent. Furthermore, a suggestion was posed to P.W.1 that she is conducting chit, in which, the respondent is one of the subscribers and when the respondent was taking prize money, at that time, Ex.P1 cheque was issued by her to the appellant, but the appellant denied the same.
15.As per the dictum of the Apex Court reported in (2010) 11 SCC 441 (Rangappa v. Sri Mohan), bare denial of the passing of the consideration apparently does not appear to be any defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the plaintiff. To disprove the presumption, the defendant has to bring on record such facts and circumstances upon consideration of which the Court may either believe that the consideration did not exist or its non-existence was so probable that a prudent man would, under the circumstances of the case, shall act upon the plea that it did not exist.
16.In the case on hand, a mere suggestion was posed to P.W.1 that she is conducting chit, in which, the respondent is one of the subscribers and when the respondent was taking prize money, at that time, Ex.P1 cheque was issued by her to the appellant and the same was also denied by her, but there is no evidence to show that the appellant herein has conducted chit business, in which, the respondent was one of the subscribers. The respondent neither got into the witness box nor examined any independent witness to prove that the appellant was conducting chit and the respondent was one of the subscribers in the chit and she has also not filed any scrap of papers. In such circumstances, applying the dictum of the Apex Court laid down in (2010) 11 SCC 441 (Rangappa v. Sri Mohan), the respondent has not rebutted the presumption under Section 139 of the Act. So onus of proving that Ex.P1 cheque was issued for discharging legally subsisting liability was not shifted to the appellant and that factum was not considered by the trial Court.
17.As per the dictum of the Apex Court in Sham Kant v. State of Maharashtra (AIR 1992 Supreme Court 1879), once if the Court comes to the conclusion that the trial Court has not considered the oral and documentary evidence and if the judgment of acquittal is perverse and is not reasonably sustainable on the evidence on record, this Court can interfere with such an order of acquittal and set at naught the injustice done to the parties concerned.
18.Considering the facts and circumstances of the case along with the above decisions, since the respondent/accused has not rebutted the presumption under Section 139 of the Act, the onus of proving that Ex.P1 cheque has been issued for discharging subsisting liability is not shifted on the appellant. So the appellant/complainant has proved that Ex.P1 cheque was issued by the respondent for discharging legally subsisting liability by invoking presumption under Sections 118 and 139 of the Act and even though the appellant had issued statutory notice to the respondent, the respondent has not repaid the amount. Hence, I am of the view, the appellant/complainant has proved that the respondent/accused is guilty for offence under Section 138 of Negotiable Instruments Act beyond reasonable doubt. Therefore, the judgment of acquittal passed by the trial Court is perverse and it is liable to be set aside and it is hereby set aside.
19.In fine, This Criminal Appeal is allowed by setting aside the judgment of acquittal dated 29.11.2007 made in C.C.No.127 of 2006 on the file of the learned Judicial Magistrate No.I, Udumalpet.
The respondent/accused is found guilty for offence under Section 138 of the Negotiable Instruments Act and he is convicted for offence under Section 138 of the Negotiable Instruments Act.
For appearance of the respondent/accused before this Court for questioning of sentence, post this appeal on __________.
23.02.2015 Index : Yes / No Internet : Yes / No Kj R.MALA,J.
kj To
1. The learned Judicial Magistrate No.I, Udumalpet.
2. The Public Prosecutor, High Court, Chennai.
3. The Record Keeper, Criminal Section, High Court, Chennai.
Pre-Delivery Judgment in Crl.A.No.92 of 2008 23.02.2015