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2015 DIGILAW 786 (CAL)

Asim Kumar Chatterjee v. State of West Bengal

2015-09-17

INDRAJIT CHATTERJEE

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JUDGMENT : Indrajit Chatterjee, J. This appeal has been directed as against the judgement and order of acquittal dated 20-07-2012 as passed by the then Judicial Magistrate, 2nd Court, Bishnupur, Bankura, in Complaint Case No. 39C of 2008 under Section 138 of the Negotiable Instruments Act (hereinafter called as N.I. Act.) 2. The case of the parties in nutshell for appreciation of this appeal can be stated in brief thus:- as per the appellant he and the respondent are two cousin brothers and the respondent took a friendly loan of Rs. 19,000/- from the appellant on 01-12-2007 without any interest with an undertaking that the same will be re-paid within three months. On 26-03-2008, the accused issued a cheque bearing No. 0024832 dated 26-03-2008 drawn on Central Bank of India, Durgapur Branch, for Rs. 19,000/-. Admittedly, the present respondent was maintaining one Account No. 1417 in that Branch. The present appellant presented the cheque to the SBI, Sonamukhi Branch, for encashing it. The appellant was maintaining one Account No. 11413949856 in that branch. The said cheque was unfortunately dishonoured by the banker of the accused on the ground “exceeds arrangements”. In other words, the cheque was dishonoured as the fund was insufficient as per the bank memo dated 04-04-2008. Thereafter, a notice was issued to the present respondent by Registered Post with A/D and the said A/D card and the envelop returned with the endorsement “intimation served” (on 19-04-2008) and further “not claimed and returned to sender” as per endorsement of the postal peon dated 25-04-2008. The envelope was marked as Ext. 3/2. The original notice was marked as Ext. 3/1. Postal receipt was marked as Ext. 3. The return Memos of the State Bank of India were marked as Exts. 2 and 2/1 and the cheque was marked as Ext.1. 3. The accused appellant did not make any payment and as such, the complaint was filed before the Additional Chief Judicial Magistrate, Bishnupur and Complaint Case No. 39-C of 2008 was registered. The case was contested by the present respondent. He was examined under Section 251 of Cr.P.C. in respect of the offence under Section 138 of the N.I Act to which the Respondent/Accused pleaded not guilty and claimed to be tried. On behalf of the present appellant, two P.Ws were examined namely, the appellant himself (P.W.1) and one Bimalendu Sarkar, a bank employee, as P.W.2. He was examined under Section 251 of Cr.P.C. in respect of the offence under Section 138 of the N.I Act to which the Respondent/Accused pleaded not guilty and claimed to be tried. On behalf of the present appellant, two P.Ws were examined namely, the appellant himself (P.W.1) and one Bimalendu Sarkar, a bank employee, as P.W.2. I have already said regarding the documentary evidence relied upon by the appellant. 4. The accused-respondent was examined under Section 313 of Cr.P.C. He replied that he had no relationship with the complainant since 2001 and as such, there was no question either of receipt of any money from him or issuance of any cheque. He also denied that he refused to accept the notice. This respondent got him examined as D.W.1 in support of his claim. The learned Trial Court after hearing of argument and scrutinizing the oral and documentary evidence on record was pleased to acquit the present respondent on the ground that there was no existing liability. The Trial Court was impressed with the evidence of D.W.1 that somehow the complainant/appellant came across the blank signed cheque and filled it up and presented it for encashment. The learned Trial Court also relied upon the decision of the Hon’ble Apex Court as reported in (2008)2 SCC (Cri) 166 at page 174 (K.J. Bhatt vs. D.G. Hegde) wherein the Apex Court observed that the existence of legally recoverable debt is not the subject matter of presumption under Section 139 of the N.I. Act which merely a raises a presumption in favour of a holder of the cheque that the same was issued for discharge of any debt or other liability. It was held by the Trial Court that the presumption was duly rebutted by the respondent. The Trial Court also relied upon the decision of the Hon’ble Apex Court as reported in (2006) 132 Company Cases 450 wherein it was observed that the accused had no burden to disprove the case of the complainant and to rebut the presumption, the accused can rely not only on the defence evidence but he can also rely on the broad improbabilities in the case of the prosecution etc. 5. On behalf of the appellant, it was argued by Mr. 5. On behalf of the appellant, it was argued by Mr. Banerjee, learned Counsel appearing for the appellant, by taking me to the evidence of P.W.1 vis-à-vis the evidence of D.W. to convince this court that the learned trial court did not consider the total perspective of a case and was practically swayed by the defence claim that some one took away the blank signed cheque from his residence and the complainant presented it for encashing the same. Learned trial court was also convinced that there was no existing liability on that score. 6. He submitted that as per the stipulation of Sections 118 and 139 of the N. I. Act, the holder of a cheque has a rebuttable presumption and that the presumption must be rebutted by plausible explanation. Learned Counsel cited a decision of the Apex Court as reported in (2010) 11 SCC 441 (Rangappa Vs. Sri Mohan) wherein in paragraph 26 of the Apex Court observed, that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat as reported in (2008) 2 SCC (Cri) 166 at page 174 and corresponding to (2008) 4 SCC 54 may not be correct. It further observed that, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein and that it is open to the accused to raise a defence where the existence of a legally enforceable debt or liability can be contested. The Apex Court further held that there can be no doubt that there is an initial presumption which favours the complaint. 7. Learned Counsel submitted that it was impossible to believe that such a small businessman in whose account even Rs. 19,000/- was not there could keep a blank signed cheque in his residence. He further submitted that the accused did not instruct the bank for stopping payment of the cheque or that he did not inform the police regarding the loss of the cheque. He further submitted that these two things would have been done by a prudent man and as in the instant case, the accused respondent did not take such step the learned trial court erred in believing this respondent. 8. He further submitted that these two things would have been done by a prudent man and as in the instant case, the accused respondent did not take such step the learned trial court erred in believing this respondent. 8. He further submitted that the accused appellant even did not receive the notice as contemplated under Section 138B of the N.I. Act. He cited the decision of this Hon’ble court to further convince the admitted position as reported in (2015) 1 CAL LT 626 (HC) (Nita Kanoi @ Bansal Vs. M/s. Paridhi & Anr.) wherein this court held that where one person signs and delivers to another a paper stamped in accordance with law relating to negotiable instrument, either wholly blank or having written thereon, an incomplete negotiable instrument, he thereby gives prima face authority to the holder thereof to make or complete, as the case may be, upon it, a negotiable instrument for any amount specified therein and not exceeding amount covered by the stamp. Thus, he submitted that the decision of the Apex Court as cited by the learned trial court in Krishna Janardhan Bhat (Supra) has practically been overruled by the Apex Court and that the presumption which the complainant appellant had been holding the cheque was not rebutted during the evidence of D.W.1 and the explanation given by the said D.W. ought to have been accepted by the court. 9. Mr. Sinha, learned Counsel, was appointed to defend the present respondent by the High Court Legal Services Committee as per the order of this court and he submitted by taking me to paragraph no. 28 of the judgment of Rangappa (Supra) to submit that 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 doubt about the existence of a legally enforceable debt or liability, the prosecution can fail. 10. Mr. Sinha cited another decision of the Apex Court as reported in (2006)3 SCC (Cri) 30 (M.S. Narayana Menon @ Mony Vs. State of Kerala & Anr.) wherein the Apex Court held that the accused is to only discharge initial onus of proof. He was not necessarily required to disbelieve the prosecution case. 10. Mr. Sinha cited another decision of the Apex Court as reported in (2006)3 SCC (Cri) 30 (M.S. Narayana Menon @ Mony Vs. State of Kerala & Anr.) wherein the Apex Court held that the accused is to only discharge initial onus of proof. He was not necessarily required to disbelieve the prosecution case. The burden of proof on the accused is not that heavy like that of the prosecution in a criminal trial. Mr. Counsel further submitted that there is a thin distinction between the presumption as contemplated under Section 139 of the N. I. Act, the presumption is only to the effect that whenever one cheque is issued the court can presume that the said cheque was issued in discharge of existing liability but similarly there is no presumption behind the insurance of a cheque that such liability was then existing when the cheque was issued and the complainant must prove the existence of that debt or liability. 11. He submitted that it is for this court to bank upon the evidence of D.W.1 as to whether the explanation submitted by him was acceptable or not. He further submitted that in a criminal trial where two views are possible – one leading to a path in favour of the accused and the other in favour of the prosecution, then the court will take that path leading in favour of the accused. Regarding withholding of the Income Tax Return of the appellant, it was submitted by Mr. Sinha that as per the decision of the Apex Court in M. S. Narayana Menon @ Mony (Supra) non-production may be viewed with suspicion and not only that the presumption of Section 114(g) of the Evidence Act is always there in favour of the defence in such a case. 12. In reply, it was submitted by Mr. Banerjee that on the date of cross-examination, this complainant was asked as to whether he showed in the ITR regarding the mention of such advancement of loan to the accused and on that date naturally that complainant P.W.1 was not holding that document with him but thereafter no notice was issued on him directing him to produce the same and as such, there cannot be any adverse presumption against him for non-production of the said ITR. 13. 13. Much was argued regarding the legal position as to the presumption in favour of the holder of a cheque. It is now the admitted position that mere signing of a cheque and handing it over to the other side is one good execution of negotiable instrument as reiterated by this court in its decision in Nita Kanoi @ Bansal (Supra). 14. It is also a settled position of law that the presumption under Section 139 of the N. I. Act postulates that whenever a cheque or negotiable instrument is issued in favour of the other side, then the court can presume that it was issued in discharge of existing liability. It is true that there is no presumption as to the existence of debt or liability and it is to be proved by the complainant before the floor of the court. 15. Here in the present case before us, the parties are relations being the cousin brothers. The complainant is one doctor and the accused respondent is one businessman. The impugned cheque was issued in respect of a cash credit account and from the bank memo, it is clear that at that point of time in that account, there was nothing to encash such cheque. Naturally, the cheque was dishonoured. 16. Now, the question comes whether the cheque was rightly issued or not. The defence through the D.W. tried to establish a case. “During my absence, I give my signed cheques to my else relation, or keep them on the sheet (sic.). Fact that it is not possible to keep account I (sic.) all the cheques. Fact, than when I give the cheques after signing, I leave them at my house. Then, says during my absence, before going elsewhere, I firstly sign upon the blank cheques, and when I issue cheques to someone. I fill up the entire cheque and then put my signature. Fact that during my absence my brother has come to my house many times”. 17. Unfortunately, for the present respondent, he did not take up the matter with the police or his banker after he noticed that the blank cheque signed by him was found missing. I fill up the entire cheque and then put my signature. Fact that during my absence my brother has come to my house many times”. 17. Unfortunately, for the present respondent, he did not take up the matter with the police or his banker after he noticed that the blank cheque signed by him was found missing. It is the natural conduct of a person who keeps a blank cheque in his house that he will keep it in safe custody but in the present case before the floor of this court, this D.W.1 did not mention in what type of custody he kept such cheque to plug it from being stolen. 18. It is true that the story as framed by this D.W.1 was accepted by the learned trial court. The appeal is practically a re-trial of a case. This court sitting on appeal over the judgement cannot eat the story to be a convincing story to give a go-by to the claim of the present respondent that the cheque was not issued but it was stolen by this complainant/appellant and it was filled in by him and thereafter presented it for encashisng the same. The relationship between the parties was that of cousin brother and naturally the story of advancement of friendly loan to the tune of Rs. 19,000/- cannot be ruled out. This court on scrutiny of the evidence of this D.W.1 is not in favour of coming to this conclusion that presumption which the complainant was having under Section 139 was rightly rebutted. It is true that the presumption under Section 139 of the N.I. Act was not that heavy like that of on the prosecution in a criminal trial but it is preponderance of probabilities which is commonly used in civil cases. Even keeping this analogy in mind, I cannot swallow the story as framed by D.W. 1/respondent. The respondent did not discharge the initial liability on him in such a case by stopping the payment of the cheque or intimating the matter to the police and naturally these two lapses will cost him much. 19. Even keeping this analogy in mind, I cannot swallow the story as framed by D.W. 1/respondent. The respondent did not discharge the initial liability on him in such a case by stopping the payment of the cheque or intimating the matter to the police and naturally these two lapses will cost him much. 19. Thus, in view of the discussion so long made and keeping in mind the legal position involved, evidence both oral and documentary, this court is satisfied that the learned trial court erred in coming to the conclusion that there was no existing liability on the part of the present respondent. This court reiterates that the cheque was issued in discharge of existing liability which remained unpaid which is definitely covered under Section 138 of the N.I. Act. This cheque was issued on 26-03-2008, i.e., before more than seven years from today and naturally the complainant has suffered both mentally and financially due to the act on the part of the present accused respondent. This act on the part of the accused must be well compensated. Thus, this court is satisfied that the complainant appellant duly proved the charge against the accused under Section 138 of the N.I Act. 20. This being so, the respondent is hereby sentenced to suffer rigorous imprisonment for ten days and to pay compensation to the tune of Rs. 40,000/-, in default. He will have to suffer rigorous imprisonment for one year more. 21. Let a copy of this order be forwarded to the learned trial court by the department along with the Lower Court Records. 22. Notice be issued by the learned trial court to the respondent to surrender within one month from the date of receipt of the notice to serve out the sentence and also to pay the compensation amount by that stipulated time. Failure to do so will entitle the learned trial court to issue warrant of arrest as against the present accused/respondent. 23. Judgement of acquittal is set aside and the finding of the learned trial court is reversed. 24. The appeal is allowed without any cost. Photostat certified copy of this judgement, if applied for, be supplied to the parties expeditiously.