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2010 DIGILAW 53 (BOM)

Rosa Maria Fernandes v. Nauso N. Kepkar

2010-01-12

R.M.SAVANT

body2010
ORAL JUDGMENT This is an appeal filed by the Original Complainant against the Judgment and Order dated 11.12.2008, passed by the Judicial Magistrate First Class, 'C' Court, Margao, acquitting the Respondent herein under Section 138 of the Negotiable Instruments Act, 1881, ('Act', for short). 2. The parties would be referred to as per their status in the Trial Court. 3. The criminal case filed by the Complainant relates to the dishonour of the cheque of Rs.50,000/- issued by the accused. The facts in brief can be stated thus : It is the case of the Complainant that she had extended to the accused a loan of Rs.50,000/- as the accused was in financial difficulties and had approached her for the said loan. It is further the case of the Complainant that on receiving the said amount of Rs.50,000/-, the accused executed a Promissory note dated 28.07.2004, declaring that the accused has taken the said amount of Rs.50,000/-from the Complainant and promising to repay the said amount to the Complainant on 28.01.2005. It is further the case of the Complainant that thereafter the accused again approached her pursuant to which the Complainant again extended to the accused a further loan of Rs.15,000/-on receipt of which, the accused executed an affidavit dated 30.07.2004, declaring that the accused has taken the said amount of Rs.65,000/-from the Complainant. It is further the case of the Complainant that in repayment of the said loan amount of Rs.65,000/-, the accused issued to the Complainant cheque bearing no. 225843 dated 28.01.2005 for Rs. 50,000/-, drawn on account no. 6039 of the accused held in Bank of Baroda, Benaulim Branch. The Complainant presented the cheque to his Bank, Bank of India, Margao, who returned the said cheque dishonoured to the Complainant on 24.06.2005 alongwith a Memorandum dated 24.06.2005 of the Bank of Baroda, Margao Branch, as also the Memorandum dated 24.06.2005 of the Bank of Baroda, Benaulim Branch, which stated that the said cheque could not be honoured on account of insufficient funds. On the cheque being dishonoured, the Complainant issued a legal notice dated 05.07.2005 to the accused through her Advocate, which was received by the accused on 14.07.2005. Despite receipt of the legal notice, the accused failed to reply or pay the said cheque amount, giving rise to the filing of the complaint. 4. The case of the accused is that of total denial. Despite receipt of the legal notice, the accused failed to reply or pay the said cheque amount, giving rise to the filing of the complaint. 4. The case of the accused is that of total denial. The case of the accused as can be seen from the statement under Section 313 of the Cr.P.C. and his own deposition is that the Complainant had agreed to purchase shop bearing no. G-1 in the building constructed by the accused and it is towards part repayment of the purchase money paid by the Complainant to him that he gave to the Complainant the two blank cheques bearing no. 225842 and 225843 as he could not sell the said shop to the Complainant. It is further the case of the accused in the affidavit in evidence that the Complainant insisted upon shop no. G-1 and that the accused agreed to sell the said shop G-1 to her only on condition that on execution of the Sale Deed she returns to the accused the two blank cheques, and that only after Angelis Pereira, the third person to whom the shop was agreed to be sold, was made a consenting party to the Sale Deed. The accused had further stated in his evidence that before executing the Sale Deed in respect of the said shop, he had asked the Complainant to return the two blank cheques but the Complainant told him not to worry about them as she has already torn and thrown the cheques out. 5. The Complainant examined herself and Pw.2, who is the driver of the Complainant, whereas the accused examined only himself. The accused denied that there was any loan transaction between the Complainant and himself and deposed that the said two cheques were given for the reasons which have been mentioned herein above in the earlier paragraph. 6. The Trial Court framed four points, out of which, point no.1, reads as follows : “Point no.1 : Whether the Accused issued a cheque in discharge of debt or other liability towards the Complainant ?’ The said point which went to the root of the matter was answered in the negative by the Trial Court. 6. The Trial Court framed four points, out of which, point no.1, reads as follows : “Point no.1 : Whether the Accused issued a cheque in discharge of debt or other liability towards the Complainant ?’ The said point which went to the root of the matter was answered in the negative by the Trial Court. The Trial Court, on appreciation of the evidence which was on record, came to the conclusion that the presumption under Section 138 of the said Act has been rebutted by the accused by raising a probable defence inasmuch as the accused has been able to raise a doubt about the loan transaction which was alleged by the Complainant and which was the case of the Complainant. In view of the fact that the Trial Court held that the accused was not in a position to prove that the cheque issued by the accused was in discharge of any debt or other liability towards the Complainant, in my view, the other points are inconsequential. 7. I have heard Shri Shirodkar, learned Counsel for the Appellant- Complainant and Shri R. S. Sardessai, learned Counsel for the Respondent- Accused. 8. It is the submission of Shri Shirodkar, that once there is an acceptance of the fact by the accused that he had issued the said cheque in question, a presumption arises that the same was towards discharge of a debt or liability. The learned Counsel submitted that the Trial Court has not appreciated the evidence in its proper prospective and has been carried away by the fact that the loan transaction has not been proved by the Complainant. The learned Counsel submitted that though the presumption under Section 139 of the Act is a rebuttable presumption, the accused has not been able to raise any probable defence considering the evidence which has come on record. The learned Counsel further submitted that the accused has raised as many as three defences at various stages. In the statement under Section 313 of the Cr.P.C., it is stated that the said cheques were given to the Complainant as security and that they were to be returned to him at the time of execution of the Sale Deed, whereas in the evidence it is his case that the said cheques were given in part re-payment of the earnest money paid by the Complainant. The learned Counsel sought to rely upon the statements made in the evidence by the accused to contend that the defence put up by the accused was not worthy of credence and that it would have to be held that the said cheques were given by the accused towards the discharge of a debt or liability. The learned Counsel further submitted that the story put up by the accused that two blank cheques were given by him is impossible to believe as no businessman can be expected to give blank cheques. The learned Counsel relied upon the Judgment of the Apex Court reported in 2002(1) Bom.C.R. 342 in the matter of K. N. Beena vs. Muniyappan & anr.. Para 6 of the said Judgment is material and is re-produced herein under : “In our view the impugned judgment cannot be sustained at all. The judgment erroneously proceeds on the basis that the burden of proving consideration for a dishonoured cheque is on the complainant. It appears that the learned Judge had lost sight of sections 118 and 139 of the Negotiable Instruments Act. Under Section 118, unless the contrary was proved, it is to be presumed that the Negotiable Instrument (including a cheque) had been made or drawn for consideration. Under Section 139 the Court has to presume, unless the contrary was proved, that the holder of the cheque received the cheque for discharge, in whole or in part, of a debt or liability. Thus in complaints under section 138, the Court has to presume that the cheque had been issued for a debt or liability. This presumption is rebutable. However the burden of proving that a cheque had not been issued for a debt or liability is on the accused. This Court in the case of (Hiten P. Dalal v. Bratindranath Banerjee) reported in 2001(5) Bom. This presumption is rebutable. However the burden of proving that a cheque had not been issued for a debt or liability is on the accused. This Court in the case of (Hiten P. Dalal v. Bratindranath Banerjee) reported in 2001(5) Bom. C.R. (S.C.) 820: 2001 Bank J. (S.C.) 822 : 2001(6) S.C.C. 16 has also taken an identical view.” The learned Counsel for the Appellant also relied upon another Judgment of the Apex Court reported in (1999) 7 S.C.C. 510 in the matter of K. Bhaskaran vs. Sankaran Vaidhyan Balan & anr., wherein the legalposition is reiterated namely that Section 139 of the Negotiable Instruments Act, enjoins on the Court to presume that the holder of the cheque received it for discharge of debt or liability and the burden was on the accused to rebut the aforesaid presumption. 9. The learned Counsel for the Appellant, therefore, submitted that considering the evidence which is on record, the acquittal of the accused was unwarranted and, therefore, the impugned Judgment is required to be interfered with in the appellate jurisdiction of this Court. 10. On behalf of the accused, the learned Counsel Shri Sardessai at the outset placed reliance on a Judgment of a learned Single Judge of this Court reported in 2008 Cri. L. J. 2405 in the matter of Shri Vinay Parulekar vs. Shri Pramod Meshram, in support of the submission that in the instant case, the accused has successfully rebutted the statutory presumption by the cross examination of the Complainant. The learned Counsel relying upon the said Judgment further submitted that the rebuttal does not have to be conclusively proved 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 standard of reasonability to be that of a prudent man. The learned Counsel further submitted that even in a case where the accused did not lead any evidence in rebuttal, it does not mean that the accused could not take advantage of the cross examination of the Complainant in rebutting the presumption. The learned Counsel further submitted that even in a case where the accused did not lead any evidence in rebuttal, it does not mean that the accused could not take advantage of the cross examination of the Complainant in rebutting the presumption. The presumption could be rebutted either by the accused leading evidence or bringing facts on record in cross examination of the Complainant which could make the case of the Complainant improbable that the cheque was issued in discharge of any debt or other liability or through other documents produced and proved through the Complainant. 11. The principles which have been culled out by the learned Single Judge upon consideration of the various Judgments are mentioned in paragraph 14 and 15 of the said report, which are reproduced herein under : “14. Upon consideration of various judgments as noted herein above, the position of law which emerges is that it is not necessary for the accused to disprove the existence of consideration by way of direct evidence. Inference of preponderance of probabilities can be drawn not only from the materials on record but also by reference to the circumstances upon which he relies. The accused can raise a probable defence from the material brought on record by him, so also by the Complainant himself. Though it is obligatory on the Court to raise presumptions contemplated under Sections 118, 138 and 139 in every case, where the factual basis for raising of the presumption has been established, what is needed for the accused is to raise a probable defence or that the consideration does not exist. The presumption could be rebutted either by leading evidence or bringing facts on record in cross examination of the Complainant which could make the case of the Complainant improbable that the cheque was issued in discharge of any debt or other liability or through the documents produced and proved through the Complainant. 15. If some material is brought on record consistent with the innocence of the accused which may reasonably be true, even though it is not positively proved to be true, the accused would be entitled to acquittal. The accused can prove the non-existence of a consideration by raising a probable defence. 15. If some material is brought on record consistent with the innocence of the accused which may reasonably be true, even though it is not positively proved to be true, the accused would be entitled to acquittal. The accused can prove the non-existence of a consideration by raising a probable defence. If the accused is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus will shift to the complainant who will be obliged to prove it as a matter of fact and upon its failure to prove will disentitle him to grant of relief on the basis of negotiable instrument. It is true that in case where the respondent failed to discharge the initial onus of proof by showing the non-existence of consideration, the complainant would invariably be held entitled to the benefit of presumption arising under Section 118(a) in his favour. However, the Court may not insist upon the accused to disprove existence of consideration by leading direct evidence as the existence of negative evidence is neither possible nor contemplated and even if led, require to be seen with doubt. The standard of proof in such cases evidently is preponderance of the probabilities. Inference of preponderance of probabilities can be drawn not only from the materials on record but also by reference to the circumstances upon which he relies. The onus, contemplated under Sections 118 and 139 of the Act, upon the accused is not as heavy as is normally upon the prosecution to prove the guilt of the accused.” 12. The learned Counsel for the accused also relied upon the Judgment of the Apex Court reported in 2008(4) S.C.C. 54 in the matter of Krishna Janardhan Bhat vs. Dattatraya G. Hegde, wherein the Apex Court has expressed a word of caution by stating that the Courts must be on guard to see that merely on the application of presumption as contemplated under Section 139, the same may not lead to injustice or mistaken conviction. The learned Counsel for the accused submitted that the accused has in the instant case, rebutted the presumption by raising a probable defence which is based on the cross examination of the Complainant. The learned Counsel for the accused submitted that the accused has in the instant case, rebutted the presumption by raising a probable defence which is based on the cross examination of the Complainant. The learned Counsel further submitted that the case of the Complainant being that of a loan transaction, the financial capacity of source of income of the Complainant was a relevant consideration whilst considering the issue of the rebuttal of presumption. The learned Counsel for the said purpose placed reliance on the Judgment of the learned Single Judge in the matter of Shri Vinay Parulekar vs. Shri Pramod Meshram (supra) as well as the Judgment of the Apex Court in the matter of Krishna Janardhan Bhat vs. Dattatraya G. Hegde (supra). The learned Counsel further submitted that since the evidence which has come on record itself creates a doubt about the loan transaction alleged by the Complainant, the accused is entitled to the benefit of doubt which has been rightly given by the Trial Court. 13. It would, therefore, be necessary to consider the material which is on record. As indicated above, the complaint in question is in respect of the cheque bearing no. 225843 dated 28.01.2005, for an amount of Rs.50,000/-which is bearing Exhibit 29. It is the case of the Complainant that the accused had approached her for a loan and that the Complainant had given a loan of Rs.50,000/-to the accused and thereafter a further amount of Rs.15,000/- to the accused. The theory of the loan transaction is a consistent theory propounded by the Complainant as can be seen from the Advocate's notice issued on behalf of the Complainant as well as by the examination in chief, the Complainant, who was Pw.1, has stated that the accused executed an Affidavit dated 30.06.2004 acknowledging the receipt of the said sum. Pw.1 has further stated that in repayment of the loan amount of Rs.65,000/-, the accused issued to her cheque bearing no. 225843 dated 28.01.2005 for Rs.50,000/-drawn on the Bank of Baroda, Benaulim Branch and another cheque bearing no. 225842 dated 28.06.2004 for Rs.15,000/-also drawn on Bank of Baroda, Benaulim Branch. However, as mentioned herein above, the complaint is only in respect of the cheque of Rs.50,000/-. 14. 225843 dated 28.01.2005 for Rs.50,000/-drawn on the Bank of Baroda, Benaulim Branch and another cheque bearing no. 225842 dated 28.06.2004 for Rs.15,000/-also drawn on Bank of Baroda, Benaulim Branch. However, as mentioned herein above, the complaint is only in respect of the cheque of Rs.50,000/-. 14. It is the case of the accused in defence, which can be seen from the suggestions which have been put to Pw.1, as also the statement of the accused under Section 313 of the Cr.P.C. and the deposition of the accused that the Complainant had agreed to purchase a shop bearing no. G-1 in the building constructed by the accused and that towards the part repayment of the purchase money paid by the Complainant to him, that he gave to the Complainant two blank cheques bearing nos. 225842 and 225843 as he could not sell the said shop to the Complainant. The accused has further stated in his affidavit in evidence that the Complainant insisted upon the said Shop no. G-1 and that the accused agreed to sell the said shop to her only on a condition that the Complainant returns to him the blank cheques and only after Angeles Pereira, the third person to whom the shop was agreed to be sold, agrees to be a consenting party to the Sale Deed. The accused has further stated in his evidence that before executing the Sale Deed in respect of the said shop, he asked the Complainant to return the two blank cheques but the Complainant told him not to worry about them as she has already torn and thrown out the cheques. 15. The accused has admitted his signature on the cheque at exhibit 29. Hence, the presumption under Section 139 of the said Act arises and the burden is on the accused to prove that there was no consideration for the cheque as held in the Judgments cited supra on behalf of the accused that the said presumption can be rebutted by leading cogent evidence or through cross examination of the Complainant. It would be pertinent to note that the accused has denied the loan transaction between the Complainant and himself and it is the case of the accused that the said cheques were given as part repayment of the purchase money but on the insistence of the Complainant for the said shop no. It would be pertinent to note that the accused has denied the loan transaction between the Complainant and himself and it is the case of the accused that the said cheques were given as part repayment of the purchase money but on the insistence of the Complainant for the said shop no. G-1, the accused told her that the said shop would be sold to her if the person to whom it has been sold namely Angeles Pereira, becomes a consenting party and that on the Sale Deed being executed in respect of the said shop no. G-1, the said cheques were to be returned to him. Therefore, it is the case of the accused that in view of the insistence of the Complainant for Shop no. G-1, the said cheques which were initially given for part repayment of the purchase money, assumed the character of a security. In view of the theory of loan transaction propounded on behalf of the Complainant, the financial capacity of the two parties also assumes significance. It is required to be noted that it has come in the evidence of the accused that various amounts were paid by the son, daughter and daughter in law of the Complainant since the year 2000 towards the purchase of the said shop by the said parties. It has come in the evidence that the said parties have paid an amount of Rs.6,50,000/-to the accused. This fact by itself, in my view, would create a doubt as regards the theory of loan transaction propounded by the Complainant. It would also be pertinent to note that the Complainant has stated in her cross examination that she does not know whether the accused is financially sound. Therefore, the case of the Complainant that the accused was in a financial crisis is difficult to accept. In so far as the financial capacity of the Complainant herself is concerned, the Complainant has stated in her cross examination that she is not working and that she lives on the earnings of her son. In the said circumstances, it is difficult to believe that a person who does not have an independent income or who has no source of income can render financial assistance of a sum of Rs.65,000/- to another person. In the said circumstances, it is difficult to believe that a person who does not have an independent income or who has no source of income can render financial assistance of a sum of Rs.65,000/- to another person. The Complainant has further stated that she raised the said amount of Rs.65,000/-by obtaining a loan of Rs.50,000/- from her sister's son so that she could give the said amount to the accused, however, the said sister's son Messy Fernandes, is not examined by the Complainant. The evidence of the said witness would have been material in the context of the fact that the Complainant had no independent source of income. 16. There are various glaring inconsistencies and contradictions in the evidence of the Complainant. Significantly, the date of the loan has not been mentioned by her. The Complainant has also stated that the accused had executed an affidavit dated 30.06.2004, admitting the receipt of Rs.65,000/-from the Complainant and the issuance of two cheques towards repayment of the said sum. In the cross examination, the Complainant has stated that there is no document to show that she gave Rs.50,000/-as loan to the accused as she trusted that the accused would repay the same. The Complainant further goes to state in her cross examination that the accused did not give any affidavit to her to show that he owes any money to her. The Complainant goes to state that the loan amount was given directly to other persons namely Angeles Pereira and Mohan in Rojgar Company and that the said loan was given in the presence of three persons namely Ganesh Redkar, Simon Fernandes and Francis Fernandes, who were present, however, the said three persons have not been examined. The Complainant has further stated that the shop is closed since she has purchased it in the year 2002 and that she has not purchased any shop in the year 2004, whereas the Sale Deed in respect of the said shop is dated 29.07.2004. It has further come in the evidence of the Complainant in her cross examination that the accused issued the cheques three years after the transaction. Thus, the statements made by the Complainant are to say the least contradictory and inconsistent and raises a doubt about the case of the Complainant. 17. It has further come in the evidence of the Complainant in her cross examination that the accused issued the cheques three years after the transaction. Thus, the statements made by the Complainant are to say the least contradictory and inconsistent and raises a doubt about the case of the Complainant. 17. The witness examined on behalf of the Complainant, Pw.2, one Romaldo Gomes, also does not support the case of the Complainant. The said witness in his cross examination has stated that he was not present when the affidavit was executed by the accused. He has further stated that he does not know the contents of the affidavit and the number of two cheques given by the accused to the Complainant. The said statements which have come in cross examination are contrary to the examination in chief of the said witness. The said Pw.2 has also stated that the Complainant gave the loan amount to the accused at the shop of the Complainant which is contrary to the case ofthe Complainant that the said amount was given in Rojgar Company. Thus, there is a contradiction between the place mentioned by Pw.1 and the place mentioned by Pw.2 as regards where the money was allegedly given, whereas, it is the case of the Complainant that the amount of Rs.65,000/- was given in two instalments of Rs.50,000/-and Rs.15,000/-. It is the evidence of Pw.2 that the said amount of Rs.65,000/-was given in one lumpsum. It is further significant to note that Pw.2 has stated that besides the Complainant and the accused, he was present when the said amount was given to the accused. It is not the case of the Complainant that the said Pw.2 was present when the money was advanced to the accused. In view of the contradictory evidence given by Pw.2, no credence can be attached to his evidence as regards any loan transaction. 18. The accused through the cross examination of Pw.1 and Pw.2 has raised a probable defence as regards the consideration for the two cheques issued by him. He has, in my view, cast a doubt as regards the theory of the loan transaction propounded by the Complainant. In my view, the case of the accused that the said cheques were given as part repayment of the purchase money and that thereafter since the Complainant insisted upon shop no. He has, in my view, cast a doubt as regards the theory of the loan transaction propounded by the Complainant. In my view, the case of the accused that the said cheques were given as part repayment of the purchase money and that thereafter since the Complainant insisted upon shop no. G-1, which the accused represented, could be sold only if the said Angeles Pereira to whom the said shop was sold agreed to be a consenting party to the Sale Deed and that on the Sale Deed being executed, the said cheques were to be returned to the accused and that when the accused asked the Complainant to return the cheques to which the Complainant stated that she has torn the cheques and thrown them out, in my view, appears to be a probable theory worthy of acceptance. The accused through the cross examination of the Complainant, has demonstrated that the Complainant did not have the financial capacity to advance any loan. The accused has also brought out the various inconsistencies and infirmities in the case of the Complainant by her cross examination whereby a serious doubt arises about the loan transaction which has been alleged by the Complainant. It would also be pertinent to note that the cheque in question was dated 21.01.2005 which was deposited by the Complainant towards the end of June 2005 when the validity period of six months was to come to an end. It would also be pertinent to note that the Sale Deed in respect of the shop in question has been executed between the parties on 29.07.2004. The Complainant, therefore, after having the Sale Deed executed in her favour and waiting till the last minute and thereafter presented the cheques, in a way speaks volumes about the conduct of the Complainant and the case of the accused that the said cheques were to be returned by the Complainant on the execution, of the Sale Deed, therefore, appears to be more probable. The Trial Court, therefore, on consideration of the evidence on record has rightly come to a conclusion that the accused has by the cross examination of the Complainant raised a serious doubt about the loan transaction. The Trial Court, therefore, on consideration of the evidence on record has rightly come to a conclusion that the accused has by the cross examination of the Complainant raised a serious doubt about the loan transaction. In my view, therefore, considering the facts and circumstances of the case as mentioned herein above, the accused has successfully rebutted the presumption under Section 139 of the Act by raising a probable defence and, therefore, the Complainant was not entitled to any reliefs under Section 138 of the Act and the Trial Court was right in dismissing the complaint. 19. In my view, therefore, no case for interference is made out. The Criminal Appeal is accordingly rejected. 20. The personal bond and surety which has been directed to be furnished by the Respondent-Accused on 11.08.2009 for an amount of Rs.10,000/-, would stand discharged.