Kerala High Court
Jayaram D vs V.K.Antony on 27 April, 2013
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS
MONDAY,THE 13TH DAY OF MARCH 2017/22ND PHALGUNA, 1938
Crl.Rev.Pet.No. 298 of 2017 ()
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CRL.A.NO. 208/2013 OF ADDITIONAL SESSIONS COURT, ALAPPUZHA
CC.NO. 50/2010 OF JUDICIAL FIRST CLASS MAGISTRATE COURT-II, CHERTHALA
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REVISION PETITIONER/APPELLANT/ACCUSED :
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JAYARAM D.,
AGED 53, S/O. DAMODARAN, GEETHALAYAM,
VALAMANGALAM SOUTH P.O, THURAVOOR,
CHERTHALA.
BY ADV. SRI.J.OM PRAKASH
RESPONDENT(S)/RESPONDENTS/COMPLAINANT AND STATE :
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1. V.K.ANTONY,
AGED ABOUT 57, S/O. VARKEY, KANDATHIL PARAMBIL,
EZHUPUNNA P.O, EZHUPUNNA VILLAGE,
CHERTHALA. PIN-688 524
2. STATE OF KERALA,
REPRESENTED BY PUBLIC PROSECUTOR,
HIGH COURT OF KERALA.
R1 BY ADV. SRI.SIBI THOMAS JACOB
R2 BY PUBLIC PROSECUTOR SRI.SAIGI JACOB PALATTY
THIS CRIMINAL REVISION PETITION HAVING COME UP FOR ADMISSION
ON 13-03-2017, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:
sts
ALEXANDER THOMAS, J.
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Crl.R.P.No. 298 of 2017
Dated==================2017
this the 13th day of March,
O R D E R
The petitioner is accused for offence under Sec.138 of the Negotiable Instruments Act in C.C.No.50/2010 on the file of the Judicial First Class Magistrate's Court-II, Cherthala, instituted on the basis of a complaint filed by the 1st respondent herein. The trial court as per the impugned judgment dated 27.4.2013 had convicted the petitioner for the abovesaid offence and had also sentenced him to undergo simple imprisonment for 3 months and to pay an amount of Rs.50,000/- (which is the amount covered by the dishonoured cheque) to the complainant as compensation under Sec. 357(3) of the Cr.P.C. and in default thereof, he was to undergo simple imprisonment for a further period of 15 days. Aggrieved thereby, the petitioner had preferred Crl.Appeal No.208/2013 before the Sessions Court, Alappuzha. The appellate court concerned (the Court of Addl. Sessions Judge, Alappuzha) by the impugned judgment rendered on 31.10.2014 has dismissed the appeal, thereby confirming the impugned sentence and conviction. It is aggrieved by the abovesaid concurrent verdicts rendered by both the courts below that the petitioner has preferred the instant Criminal Revision Petition by taking recourse to the remedies conferred under Sec.397 read with Sec.401 of the Code of Criminal Procedure.
2. The gist of the prosecution case is that the accused had owed Crl.R.P.298/17 - : 2 :-
an amount of Rs.50,000/- to the complainant as personal loan and in discharge of that liability, the accused had given Ext.P-1 cheque dated 4.12.2009 for an amount of Rs.50,000/-, which when presented by the complainant, was dishonoured on the ground of insufficiency of funds.
Thereupon, the complainant had given the statutory demand notice under Sec.138 proviso (b) of the Negotiable Instruments Act, as per Ext.P-4 notice, which was duly delivered on the accused. Since the accused did not make the payment within the stipulated time limit of 15 days, the complainant instituted the present complaint, which resulted in the trial in question leading to the conviction and sentence of the petitioner accused.
3. The complainant had examined himself as P.W-1 and has marked Exts.P-1 to P-7 documents. The accused has examined himself as DW-1 and marked Exts.D-1 to D-4 documents through P.W-1.
4. Heard Sri.J.Omprakash, learned counsel appearing for the revision petitioner accused, Sri.Sibi Thomas, learned counsel appearing for R-1 complainant and Sri.Saigi Jacob Palatty, learned Prosecutor appearing for R-2 State.
5. The case projected by the complainant in the demand notice and in the complaint as well as Sec.200 sworn statement is bereft of much details and would only briefly state that accused had owed an amount of Rs.50,000/- to the complainant and in discharge of such Crl.R.P.298/17 - : 3 :-
liability, the accused had given the cheque in question dated 4.12.2009 for Rs.50,000/-, which resulted in the dishonour, etc. The specific case projected by the defence at the time of mounting challenge against the complainant's evidence during cross examination of P.W-1 is that the accused has never borrowed the amount of Rs.50,000/- from the complainant, but that the complainant is running a chit firm and that the accused was a subscriber to a chit conducted by the complainant with the commencement period of 20.8.2011 upto the termination period of 20.11.2014 and that the monthly instalment that was to be paid by the petitioner was Rs.1,520/- per month for 40th months and that at the time of the initial entering into the chit transaction, the complainant had demanded that the petitioner to give salary certificates of at least 3 persons including himself and since it was not possible for the accused to produce 3 salary certificates as security, the complainant had taken salary certificate of the petitioner as well as 3 signed blank cheques as security and that the abovesaid dishonoured cheque in question has been misused for the present complaint. Further that the accused had defaulted in the chit instalments after the 13th monthly instalments and the defaulted amount comes to Rs.12,500/- and that it is only for this transaction that the cheque was given as security and that he had never taken any loan of Rs. 50,000/- from the complainant, etc. Apart from these suggestions, the petitioner has marked Exts.D-1 to D-4 documents Crl.R.P.298/17 - : 4 :-
through none other than P.W-1. The accused has also given detailed evidence by examining himself as DW-1. The trial court clearly accepts the contention of the defence that as P.W-1 (complainant) himself has admitted that the accused was in default of about Rs.12500/- in the chit transaction, then no reasonable man would have lend any amount and that too an higher amount of Rs.50,000/- when the earlier liability stands, and the trial court even comments that the said conduct on the part of the complainant is not a normal human conduct and that there is no satisfactory explanation on the side of P.W-1 for the abovesaid conduct. However, the trial court in the same breath proceeds to hold that for this reason alone the court below cannot discard the case projected by P.W-1 on the ground that P.W-1 himself has admitted that there has been several other transactions between the accused and the complainant and that the same were cleared and further that P.W-1 has stated that only a meagre amount is due to him in the chit transaction, etc. The appellate court when confronted with these crucial contentions, has also brushed aside these aspects and even holds that it is quite unfortunate that in a case under Sec.138 of the Negotiable Instruments Act, the appellant has taken the defence that the cheque was given as security for repayment of the chit transaction, etc. The appellate court even holds that there was no default in the chit transaction and that the accused had repaid the entire amount in the chit transaction, etc. At the Crl.R.P.298/17 - : 5 :-
outset this Court is constrained to hold that after meticulous perusal of the entire materials on record, the abovesaid finding of the appellate court that the accused had repaid the entire amount towards the chit transaction is absolutely wrong and incorrect. Moreover, this Court after detailed hearing of the learned Advocates on both sides is of the considered view that the approach made by the trial court and the appellate court in blatantly overruling the abovesaid crucial contentions of the accused, is nothing short of perversity and gross unreasonableness and that crucial and relevant evidentiary aspects have been blatantly overlooked by both the courts below and the facts of this case warrant revisional interference at the hands of this Court. The reasons for the same are given below.
6. During the cross examination of P.W-1, the defence could mark Exts.D-1 to D4 documents through none other than P.W-1 (complainant). P.W-1 has clearly admitted that he was running a chit and finance business firm called, "Chithra Chitties" and "Chithra Finance". Ext.D-1 is the passbook given to the accused as subscriber in the abovesaid chit transaction with the complainant which was to commence on 20.8.2001 an was to terminate on 20.11.2004. The said document clearly shows that the accused had paid only 30 instalments of Rs.1,250/- per month and that there was even delay in paying many of the monthly instalments and the last paid 30th instalment, which was Crl.R.P.298/17 - : 6 :-
due on 20.1.2004, was paid by the petitioner only on 2.1.2006 and that no payments are made by the petitioner from 31st instalment upto the 40th instalment. P.W-1 has clearly admitted that the accused was in arrears of Rs.12,500/- (Rs. 1250 x 10 instalments = Rs.12,500/-). However, the accused has quite candidly and honestly also marked Ext.D-3 through P.W.1, which is the daily collection card for the period from 17.7.2006 upto 8.6.2007. In Ext.D-3 it is seen that the petitioner has paid Rs.20/ per day on 39 several days between 17.7.2006 and 8.6.2007 and the total payment therein seen therein comes to Rs.780/-
(Rs.20 x 39 instalments = Rs. 780/-). Though P.W-1 has not given any explanation regarding the first entry in Ext.D-3, it is seen therein that an amount of Rs. 725 is given credit and Rs.333.75 is given debit and the net amount of payment shown therein, viz. Rs. 391.25 is given credit. What exactly is the import of those figures is not clear as there is nothing in evidence. But P.W-1 has stated subsequently during cross examination that a further amount of Rs.820/- is also seen paid and the said payment appears to be inclusive of the abovesaid payment of Rs.780/-. However, in a subsequent occasion, P.W-1 casually states that only a small insignificant amount alone was due from the accused in the chit transaction and that is why, he had acceded to the request of the accused to give a personal loan of Rs. 50,000/- at the time when the chit account was in arrears. P.W-1 has further admitted that he is also running a Crl.R.P.298/17 - : 7 :-
finance firm for money lending business in the same shop and that the amount of Rs. 50,000/- was given to the accused in the presence of 2 of his employees, one Sri.Rajesh and Sri.Jude. P.W-1 has also stated that the loan transaction took place when he had a valid licence for money lending under the Kerala Money Lenders Act, and that the said licence was current upto 2010 and that the cheque in question was given on 4.12.2009. P.W-1 has further admitted that he has instituted 2 or 3 cases in the Munsiff's Court and Magistrate's Court against defaulters in his chit and money lending business. Further P.W-1 has stated that for the defaulted chit arrears the complainant had issued Ext.D-4 notice dated 21.8.2007 to the accused stating that an amount of Rs.12,500/- is in arrears in the abovesaid chit transaction from 31st monthly instalments onwards.
7. The accused has examined himself as DW-1 and has given all the details regarding the chit transaction as revealed by Exts.D-1 to D-4 and has candidly admitted that due to his financial difficulties there was delay in paying some of the instalments and that he has committed default from 31st instalment. Though the complaint has admitted that the arrear was Rs.12,500/-, the accused has even gone to the extent of being extremely honest and candid in marking Exts.D-3 through P.W-1, which reveals that the arrear was little bit less than Rs.12,500/-. The very action of the defence in getting Ext.D-3 marked through P.W-1 Crl.R.P.298/17 - : 8 :-
during the complainant's cross examination would show that the accused has shown extreme honesty and candidness in stating the truth before the court. During cross examination of P.W-1, the accused has put the definite and concrete suggestion that the dishonoured cheque in question was one which was given by the accused as security during the chit transaction and that the same has been misused so as to falsely file this complaint alleging borrowal of Rs.50,000/-, etc. Of course, this suggestion was denied by P.W-1 during his cross examination. However, it is to be noted that DW-1 has again emphatically reiterated these aspects, that the cheque was given as security during the chit transaction and that there was never a loan transaction as the petitioner was in arrears in the chit transaction and that cheque in question which was given as security in the chit transaction has been misused by falsely alleging the instant complaint for offence under Sec.138, etc. A perusal of the cross examination of DW-1 done by the complainant would show that there has been no serious challenge as against the abovesaid version given by DW-1 regarding not only the chit transaction and its default, but also regarding the aspect that there was no loan transaction and cheque has been misused, etc.
8. PW1 (complainant) has also admitted in his cross examination that he has kept proper accounts for his business and for his lending activities and that his accounts have been regularly subjected to audit by Crl.R.P.298/17 - : 9 :-
the chartered accountant whose name has also been stated by P.W-1 and that later he had stopped his business, etc.
9. A meticulous analysis of the abovesaid facts would disclose that even the trial court was convinced (see para 8 on page 5 of the trial court judgment) that when P.W-1 himself admitted that there were arrears in the chit transaction, no reasonable man would lend any amount when an earlier liability stands and that the complainant's conduct is not a normal human conduct and that there was no satisfactory explanation on the part of P.W-1. P.W-1 has clearly admitted that there were arrears of Rs. 12,500/- in the chit transaction as evident from Ext.D-2 notice. Further even if the small daily contributions of Rs.20/-, totalling to Rs.780/-, is also taken into account, the net arrears of the accused in the chit transaction was about Rs.11,720/-. Only for the sake of getting out this difficulty, the complainant has merely stated in another portion of the cross examination that only a small insignificant amount alone was due in the chit transaction and that is why, he had given personal loan of Rs.50,000/- to the accused. The appellate court, not only fully believes his version and even goes to extent of saying that the accused had repaid the entire amount in the chit transaction. Earlier, the appellate court also says that an amount of Rs.12,500/- was due from the accused. The view of the appellate court that in spite of all these, the version of P.W-1 cannot be brushed aside as unbelievable, is Crl.R.P.298/17 - : 10 :-
nothing short of perversity. Further the finding of the appellate court that the accused had repaid the entire chit transaction is absolutely factually wrong and incorrect. P.W-1 has stated that he is running a chit business and that he has even instituted many cases against defaulters in such business transactions and that he had issued Ext.D-2 notice for the chit defaults of the accused. When that is the position, as rightly held by the trial court, the so-called projected version of P.W-1 that he had generously given Rs. 50,000/- as personal loan to the accused is against human conduct. P.W-1 is also a person business acumen, who is dealing mainly chit and money lending business and that too, with due licences and therefore it is highly unbelievable that he would have given a personal loan of Rs.50,000/- to the accused, when there were such arrears. Moreover, there is yet another important aspect of the matter. The complainant has completely suppressed the entire transactions regarding the chit as revealed from Exts.D-1 to D-4, and about money lending business, in the versions given by him in the demand notice, complaint and Sec.200 sworn statement. In those initial pleadings, the complainant only set up a case that there was a debt of Rs.50,000/- owed by the accused to the complainant. In the chief examination of P.W- 1, he comes with an entirely new version that the complainant and the accused were on friendly terms and that it was only out of mutual trust and love that he had given a personal loan of Rs.50,000/- to the accused Crl.R.P.298/17 - : 11 :-
and it is only in the cross examination made at the diligent efforts of the defence, that P.W-1 has divulged the entire prior transactions regarding the chit transaction with the accused. Therefore, the complainant has approached this Court with unclean hands in suppressing all these crucial and material transactions as between the complainant and the accused especially in relation to Exts.D-1 to D-4 chit transactions and its arrears. Therefore, it is only reasonable to hold that the accused has strongly probabilised the defence case that, in view of the previous cheque transaction and its default, the complainant would not have given any personal loan and further that the cheque in question must have been taken as security at the time of chit transaction, which is a normal feature in chit transactions. Therefore, the accused has successfully rebutted the presumption under Sec.139 and Sec.118(a) of the Negotiable Instruments Act and the burden has clearly shifted to the complainant. By strongly probabilising the defence version and rebuttal of the statutory presumption, it was for the complainant to lead cogent contra-evidence to show as to the objective factual circumstances, under which he had given the loan to the accused. If the entire chit arrears of Rs.12,500/- were subsequently repaid by the accused, prior to the issuance of the cheque in question, then certainly there would be statement of accounts and other documents with the complainant, who is running chit business, to show such payment. No such evidence whatsoever has been let in by Crl.R.P.298/17 - : 12 :-
the complainant. On the other hand, he has clearly admitted that the arrears in the chit transaction come to Rs.12,500/- as per Ext.D-2 and even if the payments in Ext.D-3, as candidly admitted by the accused, are taken into account, the net payment comes to about Rs.11,720/-. Moreover, P.W-1 has also stated that he was having licence under the Kerala Money Lenders Act also at the time of the alleged loan transaction. If that be so, it is not reasonable to accept the version of a money lender, who is regularly doing the money lending business, that he had given a personal loan of huge amount of Rs. 50,000/- to the accused out of mutual trust and love. P.W-1 has stated that his entire accounts have been audited by a chartered accountant. Therefore, if such a loan transaction was actually true, then certainly there would have been statement of accounts and other documents, to show such a loan transaction between the complainant and the accused, as his accounts have been constantly audited. No such accounts statement or any other documents have been brought in by the complainant to prove the alleged loan transaction. Non-production of such material evidence amounts to withholding the best evidence in the hands of the complainant and therefore, it is only reasonable to draw an adverse inference against the complainant in that regard. Therefore, in these circumstances, it is only reasonable to hold that after the accused had rebutted the statutory presumption, the complainant has miserably failed to discharge his Crl.R.P.298/17 - : 13 :-
burden by letting in contra-evidence to prove his version.
10. Yet another specific version projected by P.W-1 in cross examination is that the so-called loan transaction and the handing over of cheque by the accused were witnessed by two of his employees/ associates, Sri.Rajesh and Sri.Jude. If this version was actually true, then nothing prevented the complainant from examining those 2 persons or at least one among them as witnesses so as to discharge his burden in that regard. No such effort whatsoever has been taken by the complainant and no such witnesses have been adduced on his behalf. In the light of these various clinching facts and circumstances, it is only reasonable to hold that the accused had, not only rebutted the statutory presumption, but that the complainant has miserably failed to discharge his burden by letting in contra-evidence to prove his version. So the uncontroverted probable case developed by the accused is strongly in favour of the accused.
11. As stated earlier hereinabove, the complainant has suppressed crucial and material aspects of the matter, especially those factual aspects regarding the chit transactions as borne out by Exts.D-1 to D-4, in his prior versions as in demand notice, complaint, Sec.200 sworn statement, chief affidavit, etc. This Court in the judgment in Divakaran v. State of Kerala, reported in 2016(4) KLT 233 has held in para 18 thereof that where a complainant in Sec.138 matter does not Crl.R.P.298/17 - : 14 :-
disclose crucial and relevant aspects and there is no explanation why such materials were not disclosed in the statutory notice, etc., then suppression of material facts leading to the alleged transaction even in the demand notice can only be taken as artifice used by certain clever litigants so that they have the flexibility to develop a story after knowing the version that may be set up by the defence and that such an attitude of a complainant should be seen as one made with the motive of fortune seeker and doors of criminal court should be closed to such fortune seekers. Further in para 20 of the said judgment, this Court has held that in a criminal case the accused should be informed before the trial, not only of the nature of the offence but also the particulars of the transaction which are necessary for him to effectively meet the case against him. But that many unscrupulous complainants refuse to do so with the object of denying the accused a fair trial, which is a Constitutional right guaranteed under Art.21 of the Constitution and that an accused in a complaint filed under Sec. 142 of the Act is also entitled to know before the trial the particulars of the accusations against him and suppression of these particulars in the complaint alone is sufficient to order his acquittal. The initial version given by the complainant that he had advanced a personal loan of to the accused out of a "mutual trust and love", appears to be a highly improbable conduct from a money lending business man, especially when admittedly there was default and Crl.R.P.298/17 - : 15 :-
arrears in the chit transaction. By virtue of the suppression of these crucial facts, this Court has no hesitation to hold that the complainant has approached the criminal court with unclean hands. This aspect of the matter has not been considered by both the courts below and as held by this Court in Divakaran's case reported in 2016(4) KLT 233, this ground alone is sufficient to order acquittal.
12. As regards the issue of rebuttal of presumption under Sec. 139 of the N.I. Act, it may be profitable to refer to some of the leading case laws on the point. In the judgment in Hiten P.Dalal v. Bratindranath Banerjee, reported in 2001 (6) SCC 16, the Apex Court has held in para 22 thereof, as follows:
"22. Because both Sections 138 and 139 require that the court "shall presume" the liability of the drawer of the cheques for the amounts for which the cheques are drawn, as noted in State of Madras v. A. Vaidyanatha Iyer it is obligatory on the court to raise this presumption in every case where the factual basis for the raising of the presumption had been established. "It introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused."
(Ibid. at p. 65, para 14.) 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. Presumptions are rules of evidence and do not conflict with the presumption of innocence, because by the latter, all that is meant is that the prosecution is obliged to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumptions of law or fact unless the accused adduces evidence showing the reasonable possibility of the non-existence of the presumed fact."
13. In the judgment in Narayana Menon v. State of Kerala, reported in (2006) 6 SCC 39 = (2006) 3 SCC (Cri).30, it was held by the Apex Court as follows:
"41. In Hiten P. Dalal v. Bratindranath Banerjee [2001 (6) SCC 16] a three-Judge Bench of this Court held that although by reason of Crl.R.P.298/17 - : 16 :-
Sections 138 and 139 of the Act, the presumption of law as distinguished from presumption of fact is drawn, the court has no other option but to draw the same in every case where the factual basis of raising the presumption is established. Pal, J. speaking for a three- Judge Bench, however, opined: (SCC pp. 24-25, paras 22-23) "22. ... Presumptions are rules of evidence and do not conflict with the presumption of innocence, because by the latter, all that is meant is that the prosecution is obliged to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumptions of law or fact unless the accused adduces evidence showing the reasonable possibility of the non-existence of the presumed fact.
23. In other words, provided the facts required to form the basis of a presumption of law exist, no discretion is left with the court but to draw the statutory conclusion, but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary. A fact is said to be proved when, `after considering the matters before it, the court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists'.
Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the court in support of the defence that the court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the `prudent man'."
14. Later in the celebrated judgment in Rangappa v. Sree Mohan, reported in (2010) 11 SCC 441, 3-Judge bench of the Apex Court held (para 26) that the presumption mandated under Sec.139 of the N.I. Act does indeed include the existence of a legally enforceable debt or liability and that this is an initial presumption, which favours the complainant. However, it has been held in paras 27 and 28 thereof, that Sec.139 of the Act is an Act of reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments and that while Sec.138 specifies a strong criminal Crl.R.P.298/17 - : 17 :-
remedy in relation to dishonour of cheques, the rebuttable presumption under Sec.138 is a device which prevents undue delay in the course of litigation. But that the offence made punishable under Sec.138 can be better described as a regulatory offence, since the bouncing of cheques is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions and in such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused cannot be expected to discharge an unduly high standard or proof. Accordingly, it was categorically held in para 28 of the said judgment in Rangappa's case supra that in the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden and keeping this in view, it is a settled position that when an accused has to rebut the presumption under Sec.139, the standard of proof for doing so is that of "preponderance of probabilities" and 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 and that 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. It will be profitable to refer to paras 27 and 28 of the judgment in Rangappa's case supra, which read as Crl.R.P.298/17 - : 18 :-
follows:
"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 interpretation ofproportionalityclauses andguidedefendant-accused cannot test of should the construction and reverse onus the be expected to discharge an unduly high standard or proof.
clauses28. In the absence of compelling justifications, reverse onus 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."
15. So the standard of proof cast on the accused to rebut the presumption is "preponderance of probabilities", which can be drawn not only from the materials on record, but also by the other circumstances upon which he relies and the accused has only to discharge this onus of proof and is not required to disprove the prosecution case.
16. So in a case where initial burden has been discharged by the accused to rebut the statutory presumption, the burden shifts and the presumption disappears and that the accused has adduced enough evidence to advance his case, it is sufficient to discharge the initial burden so as to rebut the presumption under Secs. 139 and 118(a) of the Crl.R.P.298/17 - : 19 :-
N.I. Act.
17. A more or less similar case was the subject matter of consideration of the Apex Court in the judgment in John K.John v. Tom Varghese & Anr. reported in (2007) 12 SCC 714. In that case, the Apex Court dealt with a case of a complainant who was a partner of a firm and who was running chit fund business and the accused has subscribed 3 chitties, but had failed to pay the instalment for the prized amount and the firm had filed 3 civil suits against the respondent through the appellant complainant and the same was pending and the High Court taking note of the fact that neither any instrument was executed, nor any interest charged, although a huge amount was allegedly paid to the accused, had taken the view that the complainant did not approach the court with clean hands and his conduct was not of a prudent man and held that the accused has succeeded in rebutting the presumption arising under Sec.139 and that the complainant has failed to prove that the accused had borrowed any sum, for which those cheques have been issued. The Apex Court held that the findings made by the High Court in revision overruling the concurrent verdicts of both the courts below, are not unreasonable or perverse so as to warrant the Apex Court's interference under Art.136, even if two views are possible in the matter. It may be profitable to refer to paras 11 to 13 of the judgment of the Apex Court in John K.John's case supra, which read as follows:
'11. Relationship between the parties is not in dispute. The Crl.R.P.298/17 - : 20 :-
complainant is a partner of a firm which is in the business of running chitty fund. The fact that the respondent subscribed three chitties and that he could not pay the instalments of the prized amount is not in dispute. Pendency of three civil suits filed by the firm through the appellant against the respondent is also not in dispute. The High Court upon analysing the materials brought on record by the parties had arrived at a finding of fact that in view of the conduct of the parties it would not be prudent to hold that the respondent borrowed a huge sum despite the fact that the suits had already been filed against him by the appellant. Presumption raised in terms of Section 139 of the Act is rebuttable. If, upon analysis of the evidence brought on record by the parties, in a fact situation obtaining in the instant case, a finding of fact has been arrived at by the High Court that the cheques had not been issued by the respondent in discharge of any debt, in our opinion, the view of the High Court cannot be said to be perverse warranting interference by us in exercise of our discretionary jurisdiction under Article 136 of the Constitution. The High Court was entitled to take notice of the conduct of the parties. It has been found by the High Court as of fact that the complainant did not approach the Court with clean hands. His conduct was not that of a prudent man. Why no instrument was executed although a huge sum of money was allegedly paid to the respondent was a relevant question which could be posed in the matter. It was open to the High Court to draw its own conclusion therein. Not only had no document been executed, even no interest had been charged. It would be absurd to form an opinion that despite knowing that the respondent was not even in a position to discharge his burden to pay instalments in respect of the prized amount, an advance would be made to him and that too even after institution of three civil suits. The amount advanced even did not carry any interest. If in a situation of this nature, the High Court has arrived at a finding that the respondent has discharged his burden of proof cast on him under Section 139 of the Act, no exception thereto can be taken. exercise12. its jurisdiction under Article 136 of the Constitution would It is now a well-settled principle of law that this Court in ordinarilyofnot interfere with the judgment of acquittal, if two views are possible.
13. In M.S. Narayana Menon v. State of Kerala [2006 (6) SCC 39] this Court held: (SCC p. 56, para 54) "54. In any event the High Court entertained an appeal treating to be an appeal against acquittal, it was in fact exercising the revisional jurisdiction. Even while exercising an appellate power against a judgment of acquittal, the High Court should have borne in mind the well-settled principles of law that where two views are possible, the appellate court should not interfere with the finding of acquittal recorded by the court below."
In this view of the matter, the Apex Court had dismissed the appeals thereby confirming the impugned judgment of the High Court ordering Crl.R.P.298/17 - : 21 :-
acquittal.
18. The facts of this case are almost similar to the one in John K.John's case and the only difference in this case is that no suit was pending between the parties. But the fact of the matter remains that alleging default in the chit transaction, the complainant had issued Ext.D-2 notice for initiating proceedings for recovering the amount, etc. The view taken by this Court is fully in consonance with the abovesaid legal principle laid down by the Apex Court referred to herein above. This Court has no hesitation to hold that the impugned factual appreciation as well as the resultant conclusion drawn thereon by the both the courts below are tainted by the gross unreasonableness and perversity for the reasons stated herein above. Accordingly, this Court is constrained to hold that non-interference in a revision like this, would certainly lead to serious failure of justice. In this view of the matter, this Court is constrained to exercise its revisional powers and it is ordered that the impugned judgments of the trial court and the appellate court will stand set aside and the accused will stand acquitted of the offence under Sec. 138 of the Negotiable Instruments Act and he is ordered to be set at liberty.
With these observations and directions, the Revision Petition stands allowed as indicated above.
Sd/-
sdk+ ALEXANDER THOMAS, JUDGE
///True Copy///
P.S. to Judge
Crl.R.P.298/17 - : 22 :-