JUDGMENT K.N. Keshavanarayana J.—This appeal is directed against the judgment and order dated 3.2.2005 passed by the Presiding Officer, Fast Track Court, Bangalore in Crl.A.No. 1076/04 allowing the said appeal and reversing the judgment of conviction and order of Sentence dated 12.10.2004 passed by the XX Additional Chief Metropolitan Magistrate and XXII ASCJ in C.C.No. 27346/2000 convicting the respondent-accused of the charge levelled against him for the offence punishable under Section 138 of the Negotiable Instruments Act (for short 'N.I. Act). 2. The appellant filed complaint against the respondent alleging offence under Section 138 of NT. Act inter alia contending that, the complainant and the accused are known to each other; that the accused approached the complainant for a hand loan of Rs. 2 lakhs; that on 15.4.2000, the complainant paid the said amount in cash to the accused as hand loan and the accused undertook to repay the same and accordingly, issued a cheque bearing No. 153595 dated 20.4.2000 for Rs. 2 lakhs in favour of the complainant, drawn on Union Bank of India; that on presentation, the said cheque was returned with an endorsement "Insufficient funds"; that the complainant got issued a legal notice on the accused informing him about the return of the cheque unpaid and called upon him to pay the amount covered under the cheque within 15 days from the date of receipt of the notice; that the notice sent under RPAD was returned 'as not claimed' while the notice sent through certificate of posting is received by the accused; that in spite of service of notice. The accused failed to pay the amount covered under the said cheque, as such, he is guilty of the offence punishable under Section 138 of the N.I. Act. 3. Upon service of summons, the respondent accused appeared before the learned Magistrate and pleaded not guilty for the accusation made against him. The accused failed to pay the amount covered under the said cheque, as such, he is guilty of the offence punishable under Section 138 of the N.I. Act. 3. Upon service of summons, the respondent accused appeared before the learned Magistrate and pleaded not guilty for the accusation made against him. During the trial, it was the defence of the accused that there was no monetary transaction between him and the complainant; that the cheque in question was not issued by him towards discharge of any debt or liability due by him to the complainant; that the cheque in question along with few other cheques wert lost in the year 1997 from his office where he had kept them and immediately he lodged a complaint with the jurisdictional police and also intimated his Banker requesting them not to honour those lost cheques; that the signature found on the cheque in question is forged; that he has not received any notice said to have been issued by the complainant. Therefore, he contended that he is not guilty of the offence punishable under Section 138 of the N.I. Act. In support of the case, the complainant examined himself as PW1 and produced several documents while accused in support of his defence examined himself as DW1 and also examined an Officer of the Bank as DW2 and also produced documents. The learned Magistrate, on appreciation of oral and documentary evidence, held the accused guilty of the offence punishable under Section 138 of N.I. An. The learned Magistrate by drawing presumption under Section 139 of N.I. Act and by assessing the evidence placed by the accused, held that the accused has failed to rebut the presumption under Section 139 of N.I. Act. The learned Magistrate, noticing the reasons assigned by the Bank while returning the cheque, drew presumption under Section 146 of the N.I. Act as to the correctness of the reasons stated therein and in the light of the same, rejected the defence of the accused that the signature found on the cheque is forged. Having regard to the fact that the cheque in question admittedly relates to the account held by the accused with the Banker and it bears signature of the accused, learned Magistrate proceeded to hold that the complainant has proved the guilt of the accused for the offence punishable under Section 138 of N.I. Act. Having regard to the fact that the cheque in question admittedly relates to the account held by the accused with the Banker and it bears signature of the accused, learned Magistrate proceeded to hold that the complainant has proved the guilt of the accused for the offence punishable under Section 138 of N.I. Act. The learned Magistrate having regard to the receipt issued by the postal authorities for having sent the legal notice through certificate of posting and in view of the fact that the accused was a Municipal Councilor as such he was a prominent person in the locality, held that the notice deemed to have been served on the accused. In that view of the matter, the learned Magistrate convicted the respondent-accused for the offence punishable under Section 138 of N.I. Act and sentenced him to pay a fine of Rs. 4 lakhs. Aggrieved by the judgment of conviction and order of sentence, the respondent preferred appeal before the learned Sessions Judge in Crl.A.No. 1076/2004. The learned Appellate Judge, on re-appreciation of oral and documentary evidence, held that the defence theory is highly probable. The learned Appellate Judge, having regard to the evidence on record held the defence theory that the cheque in question had been lost in the year 1997 itself and therefore the accused could not have issued the cheque in question in the year 2000 is acceptable. The circumstances, such as non-examination of the two witnesses said to have been present at the time of lending money: the admission made by the complainant during the cross-examination that he gave 20 bundles of Rs. 10/-, each bundle containing 100 currency notes: those currency notes though said to have been drawn from the Bank, no evidence having been produced to show that said amount had been drawn from the Bank; though the complainant was an Income Tax Assessee, no evidence is produced to show this lending in his income tax returns; though provisions of Section 269SS of Income Tax Act, 1961 requires payment by way of loan above Rs. 20,000/- to be paid through 'Account Payee' cheque, huge amount of Rs. 2 lakhs was said to have been paid by cash, the learned Appellate Judge is of the opinion that the presumption under Section 139 of the N.I. Act stood rebutted and in the absence of any evidence placed by the complainant to show lending of Rs. 20,000/- to be paid through 'Account Payee' cheque, huge amount of Rs. 2 lakhs was said to have been paid by cash, the learned Appellate Judge is of the opinion that the presumption under Section 139 of the N.I. Act stood rebutted and in the absence of any evidence placed by the complainant to show lending of Rs. 2 lakhs, the accused cannot be held guilty under Section 138 of the Act. The learned Appellate Judge, further noticed that the notice purported to have been issued by the complainant as required by Section 138 of N.I.Act is not properly addressed to the accused and when notice sent by RPAD admittedly returned 'unserved', the deemed service under Section 27 of the General Clauses Act, 1897 cannot be drawn. Therefore, the lower Appellate Court has held that there is no proof of service of notice on the accused. In that view of the matter, the learned Appellate Judge has held that, the judgment of the trial Court is perverse and illegal as such the same is liable to be set aside, la the light of those findings, the lower Appellate Court allowed the appeal, set aside the judgment and order passed by the trial Court and acquitted the respondent-accused of the charge levelled against him. Against this judgment of acquittal recorded by the learned Appellate Judge, the complainant is before this Court in this appeal. 4. I have heard Sri Prakash T. Hebbar, learned counsel for the appellant and Sri G.L. Vishwanath, learned counsel for the respondent. I have perused the records secured from the Courts below as well as the judgment of the Courts below. 5. It is the submission of the learned counsel for the appellant that the judgment of the lower appellate Court is perverse and illegal in as much as the learned Judge on erroneous consideration has reversed the well reasoned judgment of the trial Court as such the judgment of the lower appellate Court is liable to be set aside. 5. It is the submission of the learned counsel for the appellant that the judgment of the lower appellate Court is perverse and illegal in as much as the learned Judge on erroneous consideration has reversed the well reasoned judgment of the trial Court as such the judgment of the lower appellate Court is liable to be set aside. It is his further submission that the defence of the accused that the cheque in question was lost in the year 1997 and in that regard he had lodged a complaint to the jurisdictional police and to his Banker has not been satisfactorily established and therefore, the lower appellate Court is not justified in coming To the conclusion that the cheque in question relates to the year 1997. It is his further submission that, in the light of the reasons assigned by the Banker of the accused while returning the cheque unpaid, the trial Court was justified in holding that the defence of the accused that signature found on the cheque leaf is forged is untenable and the learned Appellate Judge, has failed to consider this aspect, of the matter in its proper perspective. It is his further submission that in view of the presumption under Section 139 of the N.I. Act and having, regard to the fact that the accused has tailed to substantiate his defence theory of loss of cheque in question in the year 1997, the trial Court was justified in holding that the accused was guilty of the offence and the learned Appellate Judge is not right in reversing the judgment of the trial Court. It is also his submission that the findings recorded by the trial Court regarding deemed service of notice on the accused is sound and proper having regard to the facts and circumstances of the case therefore, the learned Appellate Judge is not justified in holding that the notice was not properly addressed to the accused. Therefore, he sought for setting aside the judgment of the lower appellate Court and restoration of the judgment of the trial Court. 6. On the other hand, Sri G.L. Vishwanath, learned counsel for the respondent-accused sought to justify the judgment of the lower appellate Court. Therefore, he sought for setting aside the judgment of the lower appellate Court and restoration of the judgment of the trial Court. 6. On the other hand, Sri G.L. Vishwanath, learned counsel for the respondent-accused sought to justify the judgment of the lower appellate Court. He contended that the lower appellate Court, in exercise of its power of re-appreciation of evidence, has recorded the finding holding that the finding recorded by the trial Court is perverse and illegal, being contrary to the evidence on record as such, the judgment of the lower appellate Court does not suffer from any perversity or illegality, therefore, it does not warrant interference by this Court. It is his further submission that the trial Court has failed to consider the various circumstances brought out on record, which would highly probablise the defence theory about the cheque in question having been lost in the year 1997 itself, about the non-existence of any debt due by the accused to the complainant and the cheque in question having not been issued for discharge of any debt or liability due by the accused to the complainant and the trial Court, ignoring these material circumstances on record had erroneously proceeded to hold that presumption under Section 139 of the N.I. Act is not rebutted by the accused whereas the lower appellate Court or; re-appreciation of all these materials has recorded the finding that the presumption under Section 139 of the N.I. Act has been rebutted by the accused satisfactorily. It is his submission that in the light of the evidence available on record, the lower appellate Court is right in holding that the notice purported to have been sent on behalf of the complainant was not properly addressed to the accused, as such, the lower appellate Court is right in holding that there is no deemed service as provided under Section 27 of the General Clauses Act, therefore, there is no error or illegality committed by the lower appellate Court in reversing the judgment of the tried Court. In that view of the matter, learned counsel sought for dismissal of the appeal. In that view of the matter, learned counsel sought for dismissal of the appeal. In the facts and circumstances of the case and in the light of the submissions made on both sides, the point that would arise for consideration is: Whether the judgment of the lower appellate Court reversing the judgment of the trial Court suffers from any perversity or illegality, warranting interference by this Court? 7. Of course, there is no dispute that the complainant and the accused were the Members of Mahadevapura Municipal Council as such, they are known to each other. The accused does not dispute the fact that the cheque in question relates to the account held by him with Union Bank of India, Vijinapura Branch. However, the accused disputes the signature found on the cheque-Ex.P1. According to him, the signature found on Ex.P1 is not his signature and it is a forged one. 8. As noticed supra, according to the case of the complainant, the accused approached him for a hand loan of Rs. 2 lakhs and accordingly he paid Rs. 2 lakhs by way of cash on 15.4.2000 and for discharge of the said debt, the accused issued Cheque-Ex.P1 on 20.4.2000. There is no dispute that when the cheque-Ex.P1 was presented for encashment, the same was returned with a Banker's endorsement-Ex.P3 'Insufficient Funds" in the account. Ex.P6 is the copy of the legal notice purported to have been issued on behalf of the complainant on 22.5.2000 calling upon the accused to pay the amount covered under the Cheque. The complaint came to be presented on 29.6.2000. It is the specific defence of the accused that there was no monetary transaction between the complainant and himself and that at no point of time he had borrowed any amount much less Rs. 2. lakhs from the complainant nor the cheque in question was issued for discharge of any such debt or liability due by him to the complainant. On perusal of the judgment of the trial Court, it is noticed that the learned Magistrate proceeded to rely or: the presumption under Section 139 of N.I. Act to hold that the cheque in question has been issued for discharge of debt or liability. On perusal of the judgment of the trial Court, it is noticed that the learned Magistrate proceeded to rely or: the presumption under Section 139 of N.I. Act to hold that the cheque in question has been issued for discharge of debt or liability. Of course, under Section 139 of the N.I. Act, it has to be presumed, unless the contrary is proved, that the holder of the cheque received the cheque, of the nature referred to in Section 138 of the N.I. Act, for the discharge, in whole or in part, of any debt or other liability. This presumption is a rebuttal one. Therefore, it is for the drawer of the cheque to rebut the presumption and to establish that the cheque in question was not Issued for discharge of any debt or liability due by him. It is fairly well settled law that, the standard of proof for proving the defence is preponderance of probability and not proof beyond reasonable doubt. It is also fairly well settled law, in order to prove the defence theory, it is not necessary for the accused to lead positive evidence by examining himself or by examining any other witnesses. It is open to him to point out from the evidence of the complainant/prosecution itself that, presumption under Section 139 of the N.I. Act stood rebutted. Therefore, it is the duty of the Court to evaluate the entire evidence and to find out as to whether the presumption under Section 139 of N.I. Act has been rebutted or not. According to the learned Appellate Judge, the trial Judge has not undertaken such an exercise though the accused has taken a specific defence that there was no transaction between himself and the complainant and the cheque in question was not issued by him for discharge of any debt and that the cheque in question was lost in the year 1997 itself. 9. DW2, examined by the accused, is the Assistant Manager of the Union Bank of India, Vijinapura Branch and through him Exs.C1 and C2 are marked. Ex.C1 is the account extract in relation to the account held by the accused from 1996 to 99. The cheque in question bears No. 153595. 9. DW2, examined by the accused, is the Assistant Manager of the Union Bank of India, Vijinapura Branch and through him Exs.C1 and C2 are marked. Ex.C1 is the account extract in relation to the account held by the accused from 1996 to 99. The cheque in question bears No. 153595. As could be seen from the C1-account extract, the cheque book containing the cheque leaf-Ex.P1 appears to have been issued some time during March 1997 and by December 1997, the accused had been issued with another cheque Book bearing No. 253596 series. From this, it is evident that, the cheque in question relates to the year 1997 and by April 2000, the accused had a different cheque Book for operating his account, in this context, the contents of Exs.D2 and D3 assume come importance. Ex.D2 is a copy of the intimation sent by the accused to the Manager, Union Bank of India, reporting missing of two cheque leaves including the cheque in question from his office on 6.3.97. Ex.D3 contains the acknowledgment issued by the Bank for having received the said complaint. DW2 in his evidence has asserted that the original of Ex.D2 was lodged in the Bank in the year 1997 itself, and he also produced the original of Ex.D2. Of course, as per Ex.P3, the cheque in question, was returned on the ground "Insufficient Funds". However, on that ground it cannot be said that the complaint-Exs.D2 and D3 are created documents. DW2 has come out with an explanation as to the procedure adopted by them. According to him, whenever a cheque is received for payment, they would first peruse as to whether there is sufficient money in the account and if there is sufficient amount in the account, then, they would verify the other factors, but, if there is no sufficient fund in the account then, they would return the cheque for the reason of 'Insufficient Funds'. In the light of the said explanation by DW2, the reasons stated in Ex.P3 by itself cannot be a ground to hold chat the defence theory is not acceptable. The learned trial Judge proceeded to rely on the presumption under Section 146 of N.I. Act in the light of the reasons stated in Ex.P3. In the light of the said explanation by DW2, the reasons stated in Ex.P3 by itself cannot be a ground to hold chat the defence theory is not acceptable. The learned trial Judge proceeded to rely on the presumption under Section 146 of N.I. Act in the light of the reasons stated in Ex.P3. Learned Appellate Judge has noticed that Section 146 of N.I. Act has been brought info statute book on 17.12.2002 while the endorsement relates to the year 2000. Therefore, in my opinion, the learned Appellate Judge, is justified in not complying the provisions of Section 146 of the N.I. Act to the present case. Learned Magistrate was not justified in relying on Section 146 of N.I. Act. Learned Magistrate even without referring to Ex.D3, proceeded to rely on Ex.P8 which is an endorsement said to have been issued by the concerned police to the effect that no such complaint had been filed by the accused as stated in Ex.D3. It is pertinent, to note that Ex.P8 was produced after the accused closed his side of evidence. The author of Ex.P8 has not been examined before the Court. In the light of Ex.D3 and Ex.P8, which contradicts the other, learned Magistrate was not justified in relying on Ex.P8 to hold that the defence theory is not acceptable. Perusal of the judgment of the learned Magistrate would indicate that he has not made any reference to the contents of statement of account-Ex.C1, which would clearly establish the cheque in question relates to the year 1997. It is too much to state that in order to cheat the complainant. The accused had preserved an old cheque of the year 1997 and deliberately gave the said cheque to the complainant in the year 2000. Therefore, in my considered opinion, the learned Appellate Judge is justified in holding that the defence theory is highly probable. In addition to this, the circumstances brought out on record would further strengthen the defence theory. Though according to the complainant, two witnesses were present and substantial amount of Rs. 2 lakhs was advanced, none of them were examined before the Court. It is noticed that in fact, the complainant sought permission to examine those two witnesses and the trial Court heeded to his request. However, the complainant did not pursue the same. Though according to the complainant, two witnesses were present and substantial amount of Rs. 2 lakhs was advanced, none of them were examined before the Court. It is noticed that in fact, the complainant sought permission to examine those two witnesses and the trial Court heeded to his request. However, the complainant did not pursue the same. It is also noticed that in the complaint, names of two witnesses namely Subbaraju and Kodanda Reddy are mentioned whereas in the cross-examination, PW1 come out with a different story that one Kodanda Reddy and Mani were present at the time of presenting the loan. It is also pertinent to note that even according to the complainant he is an Income Tax assessee. When a substantial amount of Rs. 2 lakhs had been advanced, it is highly unnatural to believe that the amount would have been paid in cash. The provisions of the Income Tax Act requires such transaction to be made by means of 'Account Payee' cheque. Thus, there is violation of provisions of Income Tax Act by the complainant. According to the evidence of PW1, he paid the loan amount by way of 20 bundles of currency notes of denomination of Rs. 10/- each. According to him, each bundle contained 100 currency notes and the seal of Canara Bank from where he had drawn. However, no evidence is produced by the complainant to show that he had money in his Bank account and withdrew the said amount just prior to the date of lending. If the say of the complainant that he paid 20 bundles of currency notes of denomination of Rs. 10/-, the total amount works out to only Rs. 20,000/- and not Rs. 2 lakhs. This circumstance would create great amount of doubt as to the genuineness of the transaction. Therefore, in the light of these circumstances, the lower appellate Court is justified in holding that, the accused has successfully rebutted the presumption under Section 139 of N.I. Act and since the complainant has not placed any evidence to prove the existence of the debt, the lower appellate Court has rightly held that the accused is not guilty of the offence punishable under Section 138 of N.I. Act. In addition to this, it is also necessary to note that the notice was addressed to D.No. 129, Dooravani Nagar Post, Bangalore, while the evidence placed by the accused namely Account Opening Form-C2 would establish that he is the resident of D.No. 124, Venkatappa Colony. B.Narayanapura. Dooravani Nagar, Bangalore. Thus, the notice purported to have been issued is not properly addressed to the accused. Even according to the complainant, the notice sent by the RPAD has been returned unserved. The complainant sought to rely on the deemed service as according to him, he sent notice by way of Certificate of Posting. Learned Magistrate by observing that since the accused is a known person in the locality as he was a Municipal Councilor, the notice is deemed to have been served. Such a presumption cannot be drawn under Section 27 of the General Clauses Act (for short 'the Act'). To draw presumption under Section 27 of the Act, it has to be established that the notice has been properly addressed. Further, in the case on hand, the evidence placed by the complainant would clearly establish that the notice is not properly addressed to the accused therefore, it cannot be held that there was a deemed service of notice. Therefore, in the absence of any evidence to establish the service of notice on the accused, the lower appellate Court, in my opinion, is justified in holding that the accused is not guilty of the offence punishable under Section 138 of the Act. 10. In view of the above discussion, I am of the opinion, the judgment of the lower appellate Court does not suffer from perversity or illegality warranting interference by this Court. Therefore, I find no merit in this appeal. Accordingly, the appeal is dismissed.