Karnataka High Court
Mr. Shailendra Alva S/O S. Narayana Alva vs Mr. Nagesh S/O T. Somappa on 7 September, 2006
Equivalent citations: AIR 2008 (NOC) 141 (KAR.) = 2007 (6) AIR KAR R 478, 2008 CRI. L. J. (NOC) 155 (KAR.) = 2007 (6) AIR KAR R 478, 2008 (2) ABR (NOC) 240 (KAR.) = 2007 (6) AIR KAR R 478, 2007 (6) AIR KAR R 478
Author: K. Ramanna
Bench: K. Ramanna
JUDGMENT K. Ramanna, J.
1. This appeal is filed under Section 378 (4) of the Cr.P.C. by the appellant-complainant to set aside the order of dismissal dated 14/3/2002 passed by the Additional Civil Judge, Mangalore, D.K. by acquitting the respondent for which he has been charge sheeted.
2. Assailing the same the appellant-complainant has come up with this appeal mainly on the ground that the judgment and order passed by the Court below is contrary to the provisions of Sections 138, 139, 148 and 118 of Negotiable Instrument Act (hereinafter referred to as 'the Act'). The finding recorded by the trial Court is that the liability of the accused is not proved and appellant-complainant has failed to prove the issuance of the cheque towards the existing legally recoverable debt. But the Court below has overlooked and ignored the presumption prevailing in favour of the holder in due course. In view of the provisions of Section 139 of the Act, the presumption in favour of the complainant who was the holder of the cheque that the cheque received was of the nature referred in Section 138 of the Act for discharge in whole or in part of any debt to any other liability and the accused was required to dislodge that presumption. Neither the respondent has given any reply to the legal notice nor rebutted the evidence of the complainant. Therefore, there is a failure on the part of the trial Court. Once the cheque has been issued and signature has been admitted, then automatically the burden lies on the respondent accused to prove his case. There is a specific finding that the respondent has borrowed the money and issued cheques. It cannot be said that the complaint is lacking in expressing that the cheques have been issued for discharge of the existing debt. Hence, this appeal.
3. Heard, the arguments of learned Counsel for the appellant and learned Counsel for the respondent.
4. During the course of arguments learned Counsel for the appellant submitted that the respondent heroin has issued three cheques, out of three cheques one cheque was dishonoured when presented, as time barred. The two cheques issued were presented for encashment on 2/8/1994, but were returned on 4/8/1994 dishonoured with an endorsement "insufficiency of funds." Therefore, after issuing the demand notice to the respondent, a complaint cane to be filed. But the respondent herein neither sent any reply to the legal notice nor filed any objection before the trial Court or stepped into the witness box to adduce rebuttal evidence. Therefore the dismissal of the complaint by the trial Court is on a flimsy reason that the averments of the complaint are not in accordance with the evidence placed on record by the appellant-complainant. Therefore, when once issuance of cheques and the signature of the respondent in the said cheques were admitted, automatically the burden, lies on the respondent accused to rebut the presumption available in favour of complainant. The entire burden lies on any variation in the pleadings and evidence is not a ground to disbelieve the evidence of the appellant-complainant. Therefore, the burden will automatically shift on the respondent to prove under what circumstances the two cheques are said to have been issued. Therefore, the finding recorded and the point raised by the trial Court in dismissing the complaint is totally incorrect and illegal. In criminal cases the prosecution is expected to prove the charges levelled against the accused beyond reasonable doubt. But under N.I. Act, in view of presumption available in favour of complainant, if the complainant proves his case by placing prime facie evidence that the cheques have been issued by the respondent-accused for legally recoverable debt, the presumption is to be drawn in favour of the complainant against the respondent. In the instant case since the respondent has not taken any pain to adduce rebuttal evidence. Therefore, the finding recorded by the trial Court on the ground that the averment of the complaint varies with that of the evidence of the appellant-complainant is not correct. In support of this contention, the learned Counsel for the appellant relied on a decision in the case of K. Bhaskaran v. Sankaran Vaidhyam Balaji and Anr. , wherein in the head note "D", it is held as follows:
Cheque dishonour - Accused denied having issued the cheque although he owned his signature therein - Presumption that cheque was made or drawn for consideration on date which cheque bears, arises - Holder of cheque presumed to have received it for the charge of liability -Burden is upon accused to rebut presumption.
As the signature in the cheque is admitted to be that of the accused, the presumption envisaged in Section 118 of the Act can legally be inferred that the cheque was made or drawn for consideration on the date which the cheque bears. Therefore, Section 138 of the said Act enjoins on the Court to presume that the holder of the cheque received it for the discharge of any debt or liability. The burden was on the accused to rebut the aforesaid presumption. The trial Court was not persuaded to rely on the interested testimony.
5. But in the instant case, the trial Court failed to take note of the non-issuance of reply to the legal notice and adducing of rebuttal evidence.
6. Of course the learned Counsel for the respondent relied on the decision of this Court in the cause of B.P. Venketesulu v. K.P. Mani Nayar reported in 2001 Crl.L.J. 745, wherein it has been held that:
That presumption may get displaced by the prosecution evidence on record itself, or the accused may choose to lead independent evidence in rebuttal thereof.
7. But in the instant case an opportunity was given to the respondent to give reply after bringing to the notice about the dishonour of the cheques. Neither he has given any reply to the legal notice nor adduced any rebuttal evidence. Therefore, the ratio laid down by this Court in the case of B.P. Venketesulu is not applicable to the facts of the case on hand, which has been relied on by the learned Counsel for the respondent.
8. The learned Counsel for the appellant has also relied on another decision of the Apex Court in the case of K.N. Beena v. Muniyappan and Anr. , wherein it has been hold thus:
Presumption could be rebutted by the accused by proving the contrary - Mere denial or rebuttal by accused in the reply to the legal notice sent by the complainant not enough- Accused had to prove by cogent evidence that there was no debt or liability.
9. So in the decision cited supra, the Division Bench of the Apex Court held that the accused has to prove by cogent evidence that there was no debt or liability. When the accused-respondent is liable to pay RS. 30,000/- to the complainant and to discharge the said liability the accused has issued three cheques. Of course in the sworn statement dated 7/2/1995 recorded by the trial Court at para two the very appellant has stated that the accused has borrowed a sum of Rs. 30,000/- in the month of November 1993 as loan. In order to repay the same he has issued three cheques. After appearance of the respondent-accused and after framing charges, the trial Court examined the appellant on 4/8/2001 wherein he has stated that he has taken the workshop from the respondent on rental basis and on advance deposit of Rs. 30,000/- for the payment of same, the respondent has issued three cheques. He filed a complaint for dishonour of two cheques. Of course there is a variation in the sworn statement of the complainant and the evidence of P.W. 1 with regard to the purpose for which those cheques were issued by the respondent-accused. But mere variation in the sworn statement of P.W-1 does not dissolve the liability of the respondent to rebut the evidence.
10. The learned Counsel for the respondent also relied on another decision rendered by this Court in the case of Sri G. Premdas v. Sri. Venkataraman reported in 2001 (1) K.C.C.R. 437, wherein it has been held that:
This presumption is of course available for the holder of the cheque. But unload the complainant discharges basic requirements of proof of commission of offence through cogent evidence such presumption cannot be drawn.
Considering the latest Judgment of the Supreme Court in the cause of K.N. Beena v. Muniyappan and Anr. , wherein it has been held that:
In view of the provisions contained in Sections 118 and 139, the court has to presume that the cheque had been issued for discharging a debt or liability.
The learned Counsel for the appellant also relied on other two decision in the case of Kiten P. Dayal v. (sic) Banerjee , wherein it has been held by the three judges of the Supreme Court that:
Section 139 provides that "it shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in Section 138 for the discharge, in whole or in part, or any debt or other liability." The effect of these presumptions is to place the evidential burden on the accused of proving that the cheque was not received by the complainant towards the discharge of any liability. 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 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.
In another decision, in the case of L. Mohan v. Mohan Naidu reported in 2004 Crl.L.J. 3177, held by relying on the decision in the case of Shri Ishwar Alloys Steels Ltd. v. Jayaswale Ltd. 2001 CRL.L.J. 1250 and K.N. Beena v. Muniyapan 2001 CRL.L.J. 4745, and in the case of H. Haregowda v. Thippamma reported in AIR 2000 Kant 169, wherein in all these decisions it has been held that:
Sections 118 and 139 of the N.I. Act, the Court has to presume that the cheque has been issued for discharging the debt or liability.
11. Though opportunity was given to the respondent to give reply to the legal notice issued he did not choose to give reply or adduce rebuttal evidence. Mere variation in the evidence of complainant-appellant will not come in the way of the case of the appellant to show that the cheques issued by the respondent was for legally recoverable debt. Even in the cheque issued by the respondent-accused to the claimant, he has admitted the signature and amount mentioned in it. The burden lies on the accused person to rebut the evidence, since he failed to prove either by giving reply or adducing evidence. Therefore, the conclusion arrived at by the trial Court in dismissing the complaint by acquitting the respondent accused is incorrect and illegal as the cheques issued by the respondent will be presumed that those cheques were issued in discharge of legally recoverable debt.
In the result and for the foregoing reasons, the appeal is allowed. The Judgment and order of acquittal passed by the trial Court acquitting the respondent is hereby set aside. The respondent is convicted and sentenced to pay a fine of Rs. 35,000/-, in default of payment of fine, he shall undergo S.I. for three months. Out of the fine amount deposited by the respondent, a sum of Rs. 34,000/- shall be paid to the appellant-complainant as compensation and the balance shall be paid to the State Exchanger as fine.