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2008 DIGILAW 986 (AP)

G. Ramakrishna Reddy v. Faizuddin

2008-11-18

GOPALA KRISHNA TAMADA

body2008
JUDGMENT: As the point involved in all these appeals and the parties are one and the same, they are being disposed of by this common judgment. 2. Facts, in brief, are: Appellant-complainant is the owner of a land in an extent of Acs.6-20 guntas, situated in the property bearing No.19-3-528, Jahanuma, Hyderabad, which was divided into plots of various sizes in pursuance of G.O.Ms.No.762, Revenue (UC.III) Department dated 30-08-1991. The respondent-accused, who is a dealer in real estates, purchased some plots from the appellant and agreed to register the same in the name of his nominees and accordingly issued 35 cheques in the name of the appellant as Managing Director of M/s. Southern Movietone Limited and in the name of the appellant for different amounts on behalf of his nominees, in all amounting to Rs.17,33,960/- towards sale consideration and development charges to an extent of 5376 square yards. Subsequently, on presentation of the cheques bearing Nos.275284, 275288, 275286, 275284 and 275282, dated 23-09-1993, for Rs.2,50,000/-, Rs.2,50,000/-, Rs.2,25,000/-, Rs.2,50,000/- and Rs.3,20,000/- respectively drawn on State Bank of India, Idibar branch through his banker, Vysya Bank Limited, Uppal for collection on 07-03-1994, the same were dishonoured with an endorsement "insufficient funds" and the same was informed to the appellant orally on 08-03-1994 and in writing on 09-03-1994. Thereupon, the appellant prepared notices on 08-03-1994 and sent the same to the respondent by registered post with acknowledgment due on 10-03-1994 demanding payment. But, the respondent having received the notices on 15-03-1994 has failed to comply with the demand. In those circumstances, the appellant filed private complainants being C.C.No.369 of 1994, C.C.No.770 of 1995, C.C.No.768 of 1995, C.C.No.769 of 1995 and C.C.No.371 of 1994 against the respondent-accused for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short, 'the Act'). 3. Separate trials were conducted in all the cases, wherein the appellant was examined as PW-1 and the respective documents i.e. the cheque, Memo issued by the Vysya Bank, Memo issued by State Bank of India, office copy of the legal notice got issued by the appellant to the respondent, postal receipt and postal acknowledgment were marked as Exs.P1 to P6 respectively. On appreciation of both oral and documentary evidence, the learned Magistrate found the respondent not guilty of the offence and accordingly acquitted him of the offence for which he was tried, vide separate judgments dated 06-06-2000. On appreciation of both oral and documentary evidence, the learned Magistrate found the respondent not guilty of the offence and accordingly acquitted him of the offence for which he was tried, vide separate judgments dated 06-06-2000. Assailing the said judgments, these appeals have been preferred by the appellant-complainant. 4. Heard learned counsel for the appellant and learned counsel for the respondent. 5. Learned counsel appearing on behalf of the appellant, while drawing the attention of this Court to the provisions of Sections 138 and 139 of the Act contended that when once the appellant came forward and filed cases after complying with the mandatory requirements as contemplated under the provisions of section 138 of the Act, on the ground that the cheques issued by the respondent were bounced on account of insufficiency of funds, the burden is on the respondent-accused to rebut the presumption envisaged under Section 139 of the Act. It is further contended that as the respondent has not denied the issuance of the cheques in question, which were bounced due to insufficient funds, the presumption envisaged under Section 139 of the Act would automatically come into play and as such the burden is on the respondent to rebut the said presumption. According to the learned counsel for the appellant, the trial Court, except extracting the contentions advanced by the appellant and referring to the judgments cited by him, has not discussed as to how the cheques were not issued in discharge of the legally enforceable debt and thus committed a grave error in dismissing complaints. 6. Per contra, learned counsel appearing for the respondent while supporting the impugned judgments vehemently contended that there is no legally enforceable debt between the respondent and the appellant and as such the trial Court rightly held that the respondent is not guilty of the offence alleged. According to the learned counsel, even if the contentions of the learned counsel for the appellant, are found to be correct, sufficient opportunity must have been afforded to the respondent to rebut the presumption envisaged under Section 139 of the Act or otherwise, it would cause a great hardship and prejudice to the case of the respondent. Further the learned counsel for the appellant has drawn my attention to a recent judgment of the Supreme Court in Krishna Janardhan Bhat Vs. Dattatraya G. Hegde1 7. Further the learned counsel for the appellant has drawn my attention to a recent judgment of the Supreme Court in Krishna Janardhan Bhat Vs. Dattatraya G. Hegde1 7. Having heard the learned counsel on either side, this Court is of the view that there is considerable force in the submissions made by the learned counsel on either side. 8. No doubt, it is a fact that in criminal law it is for the complainant or the prosecution, whoever the case may be, has to establish the case against the accused beyond all reasonable doubt. The said general rule of criminal law has no application for cases falling under Section 138 of the Act, in view of the statutory safeguard provided for under Section 139 of the Act. Similarly, the standard of proof, so as to prove a defence, on the part of an accused is "preponderance of probabilities", which can be drawn not only from the materials brought on record by the parties, but also by reference to the circumstances upon which he relies. Section 139 of the Act deals with presumption in favour of the holder. 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 of the Act for the discharge, in whole or in part, or any debt or other liability. In the light of the said statutory safeguard provided under Section 139 of the Act, it is not correct to say that it is for the complainant to prove that the said cheques have been issued in discharge of a legally enforceable debt. In view of the settled proposition of law that the presumption provided for under Section 138 of the Act is a rebuttable one, the general rule that the burden of proof is on the prosecution to establish its case beyond all reasonable doubt, has no applicability to the cases of this nature. It is also obligatory on the Court to raise the presumption in every case where the factual basis for raising such a 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. It is also obligatory on the Court to raise the presumption in every case where the factual basis for raising such a 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. 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 rebutted the same by showing the reasonable possibility of the non-existence of the presumed fact. 9. Coming to the cases on hand, a bare reading of the judgments impugned makes it clear that except importing the various contentions advanced by both the parties and except merely referring to the citations in different paragraphs of the judgments, the learned Magistrate did not answer or interpret the legal position to the facts of the case on hand with reference to the respective contentions. But, the learned Magistrate has simply arrived at the conclusion that the respondent has not committed the offence, without assigning any cogent reasons. Here it may be necessary to extract para No.13 of the judgment of the trial Court, which reads as under: "Having considered the evidence on record and keeping in view of the circumstances that there are civil disputes pending between the accused and complainant and also the complainant himself has admitted that he has not mentioned that any plot was sold to the accused or his nominee giving details of the plots and also has not filed any sale deed executed by him in the names of the nominees of the accused or in the name of the accused or that the complainant has placed any material record to show that the accused was due to the complainant any amount. In the circumstances, I am of the view that the evidence placed before the Court is not sufficient to hold that accused has committed an offence punishable U/s.138 of Negotiable Instrument Act. In the circumstances, I am of the view that the evidence placed before the Court is not sufficient to hold that accused has committed an offence punishable U/s.138 of Negotiable Instrument Act. Hence the complaint is dismissed." 10 The ratio in Krishna Janardhan Bhat case (1 surpa) relied on by the learned counsel for the appellant is undisputable. But the said ratio has no application to the case on hand. What was decided in the said judgment is as follows: 28. Indisputably, a mandatory presumption is required to be raised in terms of Section 118 (b) and Section 139 of the Act. Section 13 (1) of the Act defines 'negotiable instrument ' to mean "a promissory note, bill of exchange or cheque payable either to order or to bearer". 29. Section 138 of the Act has three ingredients, viz. : (i) that there is a legally enforceable debt; (ii) that the cheque was drawn from the account of bank for discharge in whole or in part of any debt or other liability which presupposes a legally enforceable debt; and (iii) that the cheque so issued had been returned due to insufficiency of funds. 30. The proviso appended to the said section provides for compliance of legal requirements before a complaint petition can be acted upon by a court of law. Section 139 of the Act merely raises a presumption in regard to the second aspect of the matter. Existence of legally recoverable debt is not a matter of presumption under Section 139 of the Act. It merely raises a presumption in favour of a holder of the cheque that the same has been issued for discharge of any debt or other liability. 31. The courts below, as noticed hereinbefore, proceeded on the basis that section 139 raises a presumption in regard to existence of a debt also. The courts below, in our opinion, committed a serious error in proceeding on the basis that for proving the defence the accused is required to step into the witness box and unless he does so he would not be discharging his burden. Such an approach on the part of the courts, we feel, is not correct. 11 But in the case on hand the facts are entirely different. Such an approach on the part of the courts, we feel, is not correct. 11 But in the case on hand the facts are entirely different. As stated supra, the learned Magistrate has not at all discussed as to how the said issuance of cheques does not fall within the meaning of discharge of legally enforceable debt. But, here the appellant has come forward with a specific version that the cheques have been issued in discharge of the legally enforceable debt and it is for the Court to decide as to whether the said cheques were issued in discharge of the legally enforceable debt or not. In the absence of any discussion it is not possible for the Court to come to a conclusion whether the said cheques were issued in discharge of the legally enforceable debt or not. 12. In this background of the matter and in view of the failure to give specific findings on the issues raised by both the counsel by assigning clear and cogent reasons in the judgments impugned, I feel that it is a fit case wherein these matters can be remitted back to the Court below for fresh consideration after affording an opportunity to both the parties to adduce evidence, if any and dispose of the same in accordance with law. 13. Accordingly, all these appeals are allowed setting aside the judgments dated 06-06-2000 passed in C.C.No.369 of 1994, C.C.No.770 of 1995, C.C.No.768 of 1995, C.C.No.769 of 1995 and C.C.No.371 of 1994 on the file of the Court of the Additional Judicial Magistrate of First Class, Hyderabad, East & North, Ranga Reddy District, and remanding the matters to the trial Court for fresh disposal in accordance with law after affording an opportunity to both the parties to adduce evidence, if any. However, since the matters are of the year 1994, the trial Court is directed to dispose of the cases as expeditiously as possible preferably within a period of six (6) months from the date of receipt of a copy of the judgment. It is also made clear that since both the parties are aware of the judgment pronounced by this Court, they are directed to appear before the learned Additional Judicial Magistrate of First Class on 19-01-2009.