JUDGMENT : 1. The instant criminal revision application is directed against the judgment dated 24.07.2014, passed by the learned Principal Sessions Judge, Sahibganj in Criminal Appeal No.24 of 2014, whereby the appeal preferred by the petitioner has been dismissed and the judgment of conviction and order of sentence dated 14.02.2014, passed by the learned Judicial Magistrate, 1st Class in P.C.R Case No.366 of 2007 corresponding to T.R. Case No.151 of 2014 whereby the petitioner has been convicted for the offence under Section 138 of Negotiable Instrument Act and sentenced to undergo simple imprisonment for a period of one year and to pay a fine of Rs.74,05,000/-(Rs. Seventy four lacs and five thousand) out of which Rs.74,00,000/-(Rs. Seventy four lacs) will be given to the complainant as compensation under Section 357 Cr.P.C. and in default of payment of fine further S.I. for six month, has been affirmed. 2. The prosecution case in brief is that a current account bearing No.0109000817300 at S.B.I Mirzachowki Branch was opened and operated by Ramakant Singh through power of attorney holder Ashu Singh (in the style Ramakant Singh POA Ashu Singh) having over draft facility. On 30.04.2007 the outstanding dues in the said account was Rs.83,60,645/- (Eighty three lack sixty thousands six hundred and forty five)only. The account holder in the course of repayment of his debts and liabilities requested the complainant Branch to purchase/discount three cheques bearing Nos.169313 dated 05.05.2007 for Rs.20,00,000/- (Twenty Lacs), 169314 dated 07.05.2007 for Rs.30,00,000/- (Thirty lacs) and 169315 dated 08.05.2007 for Rs.24,00,000/- (Twenty four lacs). All the cheques were drawn by the accused Suman Singh in favour of Ramakant Singh POA Ashu Singh on her account No.1051050168882 maintained at the HDFC Bank, Constancia Building, Dr. U.N.Brahmachari Street, Kolkata 7000017. On 30.04.2007, the complainant Bank purchased the said cheques and credited amount against the outstanding dues of the account holder resulting the reduction of the outstanding dues in the said account to Rs.10,22,310/- (Ten lacs twenty two thousand three hundred ten) only. The cheques were presented to the drawee bank but they were returned on 30.07.2007, due to the reason that the accused had stopped payment of the said cheques. After further correspondence, the drawee bank by letter dated 13.08.2007 informed that the balance in the account of accused on 30.07.2007 was Rs.30008.28/- (Rs. Thirty thousand eight and twenty eight paise) only. The cheques were presented to the drawee bank but they were returned on 30.07.2007, due to the reason that the accused had stopped payment of the said cheques. After further correspondence, the drawee bank by letter dated 13.08.2007 informed that the balance in the account of accused on 30.07.2007 was Rs.30008.28/- (Rs. Thirty thousand eight and twenty eight paise) only. Thereafter, legal notice vide letter dated 22.08.2007 was given by the complainant to repay by letter dated 21.09.2007. Remaining unpaid, the complainant filed the complaint petition dated 05.10.2007 in the court of learned Chief Judicial Magistrate, Sahibganj. 3. On the basis of aforesaid complaint petition the case was registered and finally the charge was framed against the petitioner for which she pleaded not guilty and claimed to be tried. 4. The learned trial court after dealing with the evidences, both oral and documentary, came to the conclusion that the complainant has successfully proved the charge against the accused and held the petitioner guilty for the offence punishable under Section 138 N.I. Act. 5. Being aggrieved by the judgment of conviction and order of sentence dated 14.02.2014, the petitioner preferred an appeal before the learned Principal Sessions Judge, Sahibganj, who concurred with the finding of the learned trial court and sustained the judgment of conviction and order of sentence. 6. Mr. Indrajit Sinha, learned counsel for the petitioner submits that the learned trial court has committed a gross error in convicting the petitioner in as much as there was no debt or any liability against this petitioner with the respondent-Bank. He further submits that as per the complainant the respondent-Bank on the request of Ramakant Singh POA Ashu Singh purchased the impugned cheques upon which it became the holder in due course of the said cheque. He vehemently contended that the impugned cheque discounted by the respondent-Bank on 30.04.2007, whereas the impugned cheques were dated 5th May 2007, 7th May 2007 and 8th May 2007. As such the respondent-Bank has committed a gross error in discounting the cheques prior to the date when the instrument became mature. He further contended that the entire cheques were purchased prior to its date then how there will be a debt on the date of issuance of cheques. On this score alone the complaint petition should have been dismissed. As such the respondent-Bank has committed a gross error in discounting the cheques prior to the date when the instrument became mature. He further contended that the entire cheques were purchased prior to its date then how there will be a debt on the date of issuance of cheques. On this score alone the complaint petition should have been dismissed. He further submits that the principles with regard to “holder in due course” as per Section 9 of Negotiable Instrument Act has been discussed by the Hon’ble Supreme Court of India in its judgment passed in the case of U. Ponnappa Motthan Sons, Palghat Vs. Catholic Syrian Bank Ltd & Ors. reported in 1991(1) SCC 113 , wherein in para-17 the law has been discussed as under:- 17. From the above discussion it emerges that the Indian definition imposes a more stringent condition on the holder in due course then the English definition and as the learned authors have noted the definition is based on Gill's case. Under the Indian law, a holder, to be a holder in due course, must not only have acquired the bill, note or cheque for valid consideration but should have acquired the cheque without having sufficient cause to believe that any defect existed in the title of the person from whom he derived his title. This condition requires that he should act in good faith and with reasonable caution. However, mere failure to prove bona fide or absence of negligence on his part would not negative his claim. But in a given case it is left to the Court to decide whether the negligence on part of the holder is so gross and extraordinary as to presume that he had sufficient cause to believe that such title was defective. However. when the presumption in his favour as provided under Section 118(g) gets rebutted under the circumstances mentioned therein than the burden of proving that he is a 'holder in due course' lies upon him. In a given case, the Court. while examining these requirements including valid consideration must also go into the question whether there was a contract express or implied for crediting the proceeds to the account of the bearer before receiving the same. The enquiry regarding the satisfaction of this requirement invariably depends upon the facts and circumstances in each case. In a given case, the Court. while examining these requirements including valid consideration must also go into the question whether there was a contract express or implied for crediting the proceeds to the account of the bearer before receiving the same. The enquiry regarding the satisfaction of this requirement invariably depends upon the facts and circumstances in each case. The words "without having sufficient cause to believe" have to be understood in this background. Relying upon the aforesaid judgment the learned counsel for the petitioner further contended that the first condition is that there should be no defect existed on the title of the holder in due course and the second condition is that the holder in due course should act in good faith. In the instant case both the requisite conditions are strikingly absent. He further submits that it is an admitted fact that the then Officer of the Bank did not act upon in accordance with the Banking rules and regulations and that is the reason that a criminal case has also been instituted against the then Officer along with other persons. Learned counsel for the petitioner further contended that right from the beginning it was the case of the accused petitioner that the said cheque was not issued in favour of Ramakant Singh POA Ashu Singh for any debt or liability, rather the same was issued to book a flat in Garia, Kolkata. He further submits that in his reply to the notice under Section 138 given by the Bank, she clarified the issues that she had handed over three undated cheques as security deposit regarding purchase of a flat and due to financial crisis she telephonically informed Ashu Singh not to in cash the said cheques. The learned counsel further submits that the bank has not led any evidence to the effect that the said cheques were issued for any debt and contended that the learned trial court as well as the learned appellant court over looked the main ingredient that no evidence has been led by the complainant-Bank that the said cheques were issued by the accused for her debt lying with the Bank. He further submits that the learned appellate court over looked the illegal finding of the trial court that “no evidence has been led by the accused to prove the fact that she had given the cheques to her brother Ashu Singh as a security. In this regard he relied upon the judgment passed by the Hon’ble Apex Court in the case of Basalingappa Vs. Mudibasappa, reported in 2019(5) SCC 418 wherein in para 25.3 and 25.4 law has been laid down as under:- 25.3. To rebut the presumption, it is open for the accused to rely on evidence led by him or accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely. 25.4. That it is not necessary for the accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a persuasive burden”. He further contended that in view of the aforesaid judgment of Hon’ble Apex Court, the petitioner has discharged its burden of denying the debt and the burden shifted on the respondent-Bank to rebut the statement given by the accused. He further submits that in the case of U. Ponnappa Motthan Sons, Palghat (supra) the Hon’ble Apex Court has held that “in a given case, the court, while examining these requirements including valid consideration must also go into the question whether there was a contract express or implied for crediting the proceeds to the account of the bearer before receiving the same”. In the instant case, the complaint-Bank has failed to bring any such material on record to show that there was any contract for crediting the proceeds into the current account of Ramakant Singh POA Ashu Singh. He further contended that the learned courts below have failed to look into the contents of Exhibit-A, which is the certified copy of FIR in Borio (M) P.S. Case No.123 of 2007 dated 18.09.2007 instituted by the respondent-Bank against this petitioner, Ashu Singh, Ramakant Singh and one C. Nascharr, the then Branch Manager of State Bank of India. He further contended that the learned courts below have failed to look into the contents of Exhibit-A, which is the certified copy of FIR in Borio (M) P.S. Case No.123 of 2007 dated 18.09.2007 instituted by the respondent-Bank against this petitioner, Ashu Singh, Ramakant Singh and one C. Nascharr, the then Branch Manager of State Bank of India. In the said FIR it has been specifically alleged that the said Branch Manager had no power or authority to purchase the impugned cheques and give immediate credit to them, since the same were against the Banking Rules and Regulations. He finally concluded that the learned trial court as well as learned appellate court has committed a gross error in convicting the petitioner inasmuch as the Bank has failed to prove that the cheques were issued for any debt and further on the date of presentation of the cheques there was no debt because the cheques were purchased prior to the date of presentation. 7. Per-contra, Mr. Rajesh Kumar, learned counsel for the respondent-Bank submits that there is no error, whatsoever, in the judgment passed by the learned trial court and the learned appellate court has rightly sustained the judgment of conviction and order of sentence and the instant application is fit to be dismissed. He further submits that the learned trial court has dealt with each and every aspect of the matter including Exhibit-6, which is reply to the legal notice and statement under Section 313 Cr.P.C, Exhibit 1 series and came to the conclusion that the petitioner has committed offence under Section 138 of N.I. Act. He further submits that the learned appellate court in para-7 of its judgment has categorically held that “Ramakant Singh was the payee of the cheques therefore when that were purchased from him by the bank previous consent of the drawer and privity of contract was not necessary as according to the drawer the payment of money was to be made to the person named in the cheques or on his order. Therefore by purchasing the cheques the bank became holder of the cheques. He further submits that according to Section 118 and 139 of the N.I. Act the holder of the cheque is holder in due course. A holder in due course is not only endorsee but also a person who gets possession of the instrument for consideration. Therefore by purchasing the cheques the bank became holder of the cheques. He further submits that according to Section 118 and 139 of the N.I. Act the holder of the cheque is holder in due course. A holder in due course is not only endorsee but also a person who gets possession of the instrument for consideration. But according to Section 118 it shall be presumed that the cheques were transferred for consideration. Therefore it is not the complainant who has to prove that the Bank was holder in due course of the cheque. The learned counsel for the Bank has categorically submitted that after crediting the cheques, the value was appropriated against the outstanding dues of the account holder and the outstanding dues in the books of the complainant-Bank pertaining to the account holder had come down to Rs.10,22,310/-. He lastly concluded by submitting that Section 139 of N.I. Act provides for drawing the presumption in favour of holder. He further submits that the judgment relied upon by the petitioner is not of any help for the petitioner. He further relied upon the judgment passed by the Hon’ble Apex Court in the case of Kishan Sao Vs. Shankargouda reported in (2018) 8 SCC 165 , wherein in para 18 to 22 law has been discussed as under:- 18. Section 139 of the Act, 1881 provides for drawing the presumption in favour of holder. Section 139 is to the following effect : “139.Presumption in favour of 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 for the discharge, in whole or in part, of any debt or other liability.” 19. This Court in Kumar Exports vs. Sharma Carpets, 2009 (2) SCC 513 , had considered the provisions of Negotiable Instruments Act as well Evidence Act. Referring to Section 139, this Court laid down following in paragraphs 14, 15, 18 and 19: “14. Section 139 of the Act 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, of any debt or other liability. 15. Section 139 of the Act 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, of any debt or other liability. 15. Presumptions are devices by use of which the courts are enabled and entitled to pronounce on an issue notwithstanding that there is no evidence or insufficient evidence. Under the Evidence Act all presumptions must come under one or the other class of the three classes mentioned in the Act, namely, (1) “may presume” (rebuttable), (2) “shall presume” (rebuttable), and (3) “conclusive presumptions” (irrebuttable). The term “presumption” is used to designate an inference, affirmative or dis-affirmative of the existence of a fact, conveniently called the “presumed fact” drawn by a judicial tribunal, by a process of probable 13 reasoning from some matter of fact, either judicially noticed or admitted or established by legal evidence to the satisfaction of the tribunal. Presumption literally means “taking as true without examination or proof”. 18. Applying the definition of the word “proved” in Section 3 of the Evidence Act to the provisions of Sections 118 and 139 of the Act, it becomes evident that in a trial under Section 138 of the Act a presumption will have to be made that every negotiable instrument was made or drawn for consideration and that it was executed for discharge of debt or liability once the execution of negotiable instrument is either proved or admitted. As soon as the complainant discharges the burden to prove that the instrument, say a note, was executed by the accused, the rules of presumptions under Sections 118 and 139 of the Act help him shift the burden on the accused. The presumptions will live, exist and survive and shall end only when the contrary is proved by the accused, that is, the cheque was not issued for consideration and in discharge of any debt or liability. A presumption is not in itself evidence, but only makes a prima facie case for a party for whose benefit it exists. 19. The presumptions will live, exist and survive and shall end only when the contrary is proved by the accused, that is, the cheque was not issued for consideration and in discharge of any debt or liability. A presumption is not in itself evidence, but only makes a prima facie case for a party for whose benefit it exists. 19. The use of the phrase “until the contrary is proved” in Section 118 of the Act and use of the words “unless the contrary is proved” in Section 139 of the Act read with definitions of “may presume” and “shall presume” as given in Section 4 of the Evidence Act, makes it at once clear that presumptions to be raised under both the provisions are rebuttable. When a presumption is rebuttable, it only points out that the party on whom lies the duty of going forward with evidence, on the fact presumed and when that party has produced evidence fairly and reasonably tending to show that the real fact is not as presumed, the purpose of the presumption is over.” 20. This Court held that the accused may adduce evidence to rebut the presumption, but mere denial regarding existence of debt shall not serve any purpose. Following was held in paragraph 20: “20....The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the court need not insist in every case that the accused should disprove the nonexistence of consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that bare denial of the passing of the consideration and existence of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumptions, the accused should bring on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist...” 15 21. To disprove the presumptions, the accused should bring on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist...” 15 21. In the present case, the trial court as well as the Appellate Court having found that cheque contained the signatures of the accused and it was given to the appellant to present in the Bank of the presumption under Section 139 was rightly raised which was not rebutted by the accused. The accused had not led any evidence to rebut the aforesaid presumption. The accused even did not come in the witness box to support his case. In the reply to the notice which was given by the appellant the accused took the defence that the cheque was stolen by the appellant. The said defence was rejected by the trial court after considering the evidence on record with regard to which no contrary view has also been expressed by the High Court. 22. Another judgment which needs to be looked into is Rangappa vs. Sri Mohan, 2010 (11) SCC 441 . A three Judge Bench of this Court had occasion to examine the presumption under Section 139 of the Act, 1881. This Court in the aforesaid case has held that in the event the accused is able to raise a probable defence which creates doubt with regard to the existence of a debt or liability, the presumption may fail. Following was laid down in paragraphs 26 and 27: “26. In light of these extracts, we are in agreement with the respondent claimant 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, (2008) 4 SCC 54 , may not be correct. However, 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. To that extent, the impugned observations in Krishna Janardhan Bhat, (2008) 4 SCC 54 , may not be correct. However, 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. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant. 27. Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the defendant-accused cannot be expected to discharge an unduly high standard or proof.” 8. Heard learned counsel for the petitioner and learned counsel for the respondent-Bank. 9. In the light of the rival contentions, following questions arise for consideration: (1) Whether courts below were justified in holding that the complainant bank is holder in due course of the cheques in question? (2) Whether the holder in due course of a cheque, can maintain a complaint for the offence punishable under Section 138 of the Act against the drawer of the cheque? (3) Whether the courts below were justified in holding that the accused is guilty of the offence punishable under Section 138 of the Act? 10. Re-Questions.1: There is no serious dispute that the cheques involved in the instant case bear signature of the accused-petitioner. (3) Whether the courts below were justified in holding that the accused is guilty of the offence punishable under Section 138 of the Act? 10. Re-Questions.1: There is no serious dispute that the cheques involved in the instant case bear signature of the accused-petitioner. It is the specific case of the complainant Bank that these cheques were discounted by the payee and the amount covered under cheques was appropriated in the account no. 0109000817300 bearing over draft facility. Under these circumstances, it is the contention of the complainant that it became the holder in due course of the cheques in question for consideration. Section 8 of the Act defines the “Holder” as under: “The holder’ of a promissory note, bill of exchange or cheque means any person entitled in his own name to the possession thereof and to receive or recover the amount due thereon from the parties thereto.” Section 9 of the Act defines the “Holder in due course” and it reads as under : “9. “Holder in due course” – “Holder in due course: means any person who for consideration became the possessor of a promissory note, bill of exchange or cheque if payable to bearer, or the payee or indorse thereof, if [payable to order], before the amount mentioned in it became payable and without having sufficient cause to believe that any defect existed in the title of the person from whom he derived his title.” Section 10 of the Act defines “payment in due course” as under : “10. “Payment in due course” – “Payment in due course” means payment in accordance with the apparent tenor of the instrument in good faith and without negligence to any person in possession thereof under circumstances which do not afford a reasonable ground for believing that he is not entitled to receive payment of the amount therein mentioned.” Thus from the definitions of the “holder”, holder in due course” and “payment in due course” in Sections 8, 9 and 10, as extracted above, any person to become a “holder in due course “of a negotiable instrument, the following requirements are to be satisfied: (i) he must be a holder for consideration; (ii) the instrument must have been transferred to him before it becomes overdue; (iii) he must be a transferee in good faith and he should not have any reason to believe that there was any defect in the title of the transferor. The evidence placed on record in the instant case which is not disputed by the accused person, clearly establishes that the payee under these cheques issued by accused got the cheques discounted with the complainant bank and received consideration and delivered the cheques to the possession of the complainant. On the reverse side of these cheques, there is an endorsement to the effect that the payee’s account is credited. This is another circumstance, which would establish the circumstance of complainant becoming the holder of the cheques in question for consideration. Therefore, the courts below were rights in holding that the complainant became the possessor of the cheques in question for consideration. 11. Section 118(g) of the Act raises presumption that holder of the instrument is a holder in the due course. However as per proviso, where an instrument has been obtained from its lawful owner, or from any person in lawful custody thereof, by means of an offence or fraud, or has been obtained from the maker or acceptor thereof by means of any offence or fraud or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him. In the present case, it is not the contention of the accused that the complainant bank obtained the custody of the cheques by means of any offence or fraud or for unlawful consideration. In the present case, it is not the contention of the accused that the complainant bank obtained the custody of the cheques by means of any offence or fraud or for unlawful consideration. Therefore, as per the presumption under Section 118 (g) of the Act, the complainant became holder in due course of the cheques in question. 12. Now the next aspect required to be considered is whether the complainant has satisfactorily proved the third requirement namely that it was a transferee in good faith and it had no sufficient cause to believe that any defect existed in the title of the transferor over the cheques. 13. The Apex Court in the case of M/s. U.Ponnappa Moothan Sons, Palghat vs. Catholic Syrian Bank Ltd. and others reported in AIR 1991 SC 441 had an occasion to consider as to what constituted “sufficient cause to believe that any defect existed in the title of payee over the instrument” found in Section 9 of the Act to call a person in possession of negotiable instrument as holder in due course. After referring to decisions of various courts including English Courts and by referring to the passages from the Bashyam & Adiga on the Negotiable Instruments Act, 15th Edition and other authors, Their Lordships of the Apex Court in paras 13 and 17 have observed thus: “13. However, with regard to the legal importance of negligence in appreciating the principle of “sufficient cause to believe” a passage from Chalmers’ book “The Law Relating to Negotiable Instruments in British India” 4th Edn. may usefully be noted: “All the circumstances of the transactions whereby the holder became possessed of the instrument have a bearing on the question whether he had “sufficient cause to believe” that any defect existed. It is left to the Court to decide, in any case where the holder has been negligent in taking the instrument without close enquiry as to the title of his transferor, whether such negligence is so extraordinary as to lead to the presumption that the holder had cause to believe that such title was defective.” (Emphasis supplied) This view is more sound and logical. The legal position as explained by Chitty may be noted in this context which reads as under : “While the doctrine of constructive notice does not apply in the law of negotiable instrument the holder is not entitled to disregard a “red flag” which has raised his suspicions.” We, therefore, modify the view taken by the Allahabad High Court in Durga Shah’s case (AIR 1952 Allahabad 590) to the extent that though the failure to prove bona fide or absence of negligence would not negative the claim of the holder to be a holder in due course, yet in the circumstances of a given case, if there is patent gross negligence on his part which by itself indicates lack of due diligence, it can negative his claim, for he cannot negligently disregard a “red flag” which arouses suspicion regarding the title. In this view of the matter we hold that the decision in Raghavji’s case (1906 (8) Bom LR 921) does not lay down correct law. We agree with the view taken by the Allahabad High Court with above modification. 17. From the above discussion it emerges that the Indian definition imposes a more stringent condition on the holder in due course than the English definition and as the learned authors have noted the definition is based on Gill’s case (1824 (107) ER 806). Under the Indian law, a holder, to be a holder in due course, must not only have acquired the bill, note or cheque for valid consideration but should have acquired the cheque without having sufficient cause to believe that any defect existed in the title of the person from whom he derived his title. This condition requires that he should act in good faith and with reasonable caution. However, mere failure to prove bona fide or absence of negligence on his part would not negative his claim. But in a given case it is left to the Court to decide whether the negligence on the part of the holder is so gross and extraordinary as to presume that he had sufficient cause to believe that such title was defective. However, when the presumption in his favour as provided under S.118(g) gets rebutted under the circumstances mentioned therein then the burden of proving that he is a “holder in due course’ lies upon him. However, when the presumption in his favour as provided under S.118(g) gets rebutted under the circumstances mentioned therein then the burden of proving that he is a “holder in due course’ lies upon him. In a given case, the Court, while examining these requirements including valid consideration must also go into the question whether there was a contract express or implied for crediting the proceeds to the account of the bearer before receiving the same. The enquiry regarding the satisfaction of this requirement invariably depends upon the facts and circumstances in each case. The words “without having sufficient cause to believe” have to be understood in this background.” In Bank of Maharashtra Vs. Auto Motive Engineering Company reported in (1993) 2 SCC 97 , the Hon’ble Apex Court while considering the expression “ in good faith and without negligence” occurring in Section 10 of the Act, has observed in paragraph-11 that though no strait-jacket formula can be laid down to cover each case of negligence of a banker, the question of negligence requires to be decided in the facts and circumstances in each case. 14. As held by the Apex Court in Ponnappa’s case referred to supra, when the presumption in favour of the holder of the Negotiable Instrument as provided under Section 118(g) of the Act gets rebutted under the circumstances mentioned therein, then the burden of proving that he is holder in due course lies upon him. The Apex Court has clearly held that the enquiry regarding satisfaction of this requirement depends upon the facts and circumstances of each case and the words “without having sufficient cause to believe” have to be understood in this background. No doubt, it is not the case of the drawers of the cheques that the complainant became the possessor of the cheques in question under the circumstances mentioned under Section 118(g) of the Act. Therefore, the presumption under Section 118(g) has not been rebutted. 15. No doubt, it is not the case of the drawers of the cheques that the complainant became the possessor of the cheques in question under the circumstances mentioned under Section 118(g) of the Act. Therefore, the presumption under Section 118(g) has not been rebutted. 15. Of course, as held by the Apex Court in Ponnappa’s case though failure on the part of holder of an instrument to prove his bonafide or absence of negligence would not negative his claim as a holder in due course, yet in the circumstances of a given case, if there is patent gross negligence on his part which by itself indicates lack of due diligence, it can negative his claim for he cannot negligently disregard a “red flag” which arouses suspicion regarding the title. In the light of this, let me consider the facts and circumstances of this case to find out as to whether there is patent gross negligence on the part of the complainant indicating lack of due diligence which is sufficient to create suspicion regarding the title of transferors over the cheques. 16. The evidence on record indicates that the drawer of these cheques is close relative of payee. These cheques were issued by accused-petitioner in favour her one brother namely Ashu Singh. The cheques in question were drawn for substantial amounts. It is not the say of either P.W.1 or P.W.2 or even P.W.3 that before discounting the cheques, the payee was asked as to whether the cheques drawn for such substantial amounts were for discharge of any debt or liability due to him by the drawer or whether the cheques were issued as financial assistance to him by the drawer for their business. The very fact that the cheques are shown to have been issued by petitioner in favour of Ramakant Singh POA Ashu Singh for substantial amounts would be sufficient in normal circumstances to create suspicion in the mind of even an ordinary person much less an official of a scheduled Bank about the entitlement of payee to receive the amounts mentioned therein. In view of this, the Officer of the Bank before discounting the cheques, ought to have made minimum enquiry as to under what circumstances, the drawer had issued the cheques; As the cheques were purported to have been issued for considerable amount, the bank, before discounting them ought to have enquired with the bank on which the cheques are drawn to know as to whether, the cheques would be hounoured if sent for collection & whether there is sufficient fund in the account of the drawer. With the advancement in Technology, this kind of enquiry was not difficult. Why in such a hurry substantial amount was paid to the payee by discounting the cheques even without making any enquiry about the credibility of the drawer and payee, is not explained by the complainant Bank. There is absolutely no evidence placed by the complainant bank to show that it acted in good faith. The Manager, who discounted the cheques is not examined to explain the steps he took before discounting the cheques. On the other hand, the evidence on record establishes that, the Bank initiated filed a criminal case against the said Manager for causing loss to the Bank by his negligent act in discounting the cheques without proper enquiry. This fact is more than sufficient to come to the conclusion that the complainant Bank has not acted in good faith, and there were several circumstances and reasons to raise suspicion as to whether the payee under the cheques was entitled to receive the money under the cheques. Therefore, there is no difficulty in holding that the Bank did not become the holder in due course of those cheques. The courts below have failed to consider the above aspects and have reached erroneous finding. 17. In the light of the above discussion, I hold that the courts below were not justified in holding that the complainant bank is holder in due course of the cheques in question. Hence, I answer question No.1 in the negative. 18. Re-Question No.2: Section 138 of the Act deals with dishonour of cheques for insufficiency of funds in the accounts. The main section deals with the offence upon dishonour of the cheque. However, proviso to Section 138, lays down conditions under which dishonour of cheque would constitute an offence punishable under Section 138 of the Act. 18. Re-Question No.2: Section 138 of the Act deals with dishonour of cheques for insufficiency of funds in the accounts. The main section deals with the offence upon dishonour of the cheque. However, proviso to Section 138, lays down conditions under which dishonour of cheque would constitute an offence punishable under Section 138 of the Act. As per proviso (b) dishonour of the cheque do not become an offence unless the payee or holder in due course of the cheque as the case may be makes a demand for payment of said money by giving a notice in writing to the drawer of the cheque within a period of thirty days of the receipt of the information from the Bank regarding the dishonour of the cheque. Thus, Section 138 proviso (b) clearly provides for holder in due course of the cheque also making a demand by issuing a notice. 19. Section 142 of the Act deals with cognizance of the offences. As per clause (a) of Section 142, notwithstanding anything contained in Cr.P.C, 1973 no Court shall take cognizance of the offence punishable under Section 138 except on a complaint made by the payee or, as the case may be, the holder in due course of the cheque. (emphasis supplied) Thus from the above, it is clear that even on a complaint filed by the holder in due course, the court can take cognizance of the offence punishable under Section 138 of the Act. Thus, the conjoint reading of Section 138 (b) & 142 (a) of the Act makes it clear that a holder in due course is entitled to maintain a complaint for offence under section 138 of the N.I. Act. The provisions of Section 138 (b) and 142 (a) of the Act which clearly indicates that holder in due course can maintain a complaint. Having regard to the statutory provisions of Section 138 Proviso (b) and 142 (a) of the Act, I have no doubt in my mind that a holder in due course of a cheque can maintain a complaint for the offence punishable under Section 138 of the Act. In view of the above, I question No.2 in the affirmative. 20. Having regard to the statutory provisions of Section 138 Proviso (b) and 142 (a) of the Act, I have no doubt in my mind that a holder in due course of a cheque can maintain a complaint for the offence punishable under Section 138 of the Act. In view of the above, I question No.2 in the affirmative. 20. Re-Question No.3: As could be seen from the judgments of the courts below, both the courts after holding that the complainant became holder in due course and that the accused issued those cheques to the payee who in turn discounted the same with the bank for consideration, have drawn the presumption under Sections 118 (a) and 139 of the Act to the effect that the cheques in question have been issued for consideration and those cheques are issued for discharge of legally enforceable debt. The courts below have further held that since the accused has failed to rebut statutory presumption under Section 118 (a) and 139 of the Act, by placing any positive evidence or by bringing out any circumstance on record, she is guilty of offence punishable under Section 138 of the Act. As noticed earlier, it is the contentions of the learned counsel for the accused-petitioner that the courts below have erroneously drawn the presumption under Section 139 of the Act that the cheques in question have been issued for consideration though the said presumption do not extend as to the existence of legally enforceable debt or liability. In other words, it is his contention that before drawing presumption under Section 139 of the Act to the effect that the cheques in question have been issued for discharge of a debt or liability, it was incumbent on the part of the complainant to have proved the existence of legally enforceable debt or liability. It is also his contention that presumption under Section 118(a) of the Act has no application to the facts and circumstances of the case. The Apex Court in the case of Krishnajanardhan Bhat Vs. Dattatreya G. Hegde reported in AIR (2008) SC 1325, the law has been laid down as under: “28. Indisputably, a mandatory presumption is required to be raised in terms of Section 118(a) and Section 139 of the Act. The Apex Court in the case of Krishnajanardhan Bhat Vs. Dattatreya G. Hegde reported in AIR (2008) SC 1325, the law has been laid down as under: “28. Indisputably, a mandatory presumption is required to be raised in terms of Section 118(a) 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 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 pre-supposes a legally enforceable debt; (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 with legal requirements before a complaint petition can be acted upon by a courts 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.” Thus from the observations extracted above, it is clear that presumption under section 139 of the n.i act is only to the extent that the cheque was drawn for discharge in full or in part of any debt or other liability and the said presumption do not relate to the existence of legally enforceable debt or liability. Therefore, before drawing the presumption under section 139 of the n.i. act, it is the duty of the Court to see whether or not the complainant has discharged his initial burden as to existence of legally enforceable debt. Nodoubt as per Section 118(a) of the Act, there is a rebuttable presumption that every negotiable instrument was made or drawn for consideration and when such instrument is accepted, endorsed, negotiated or transferred was accepted, endorsed, negotiated or transferred for consideration. 21. Nodoubt as per Section 118(a) of the Act, there is a rebuttable presumption that every negotiable instrument was made or drawn for consideration and when such instrument is accepted, endorsed, negotiated or transferred was accepted, endorsed, negotiated or transferred for consideration. 21. In the aforesaid decision, the Apex Court also considered how an accused person could discharge the burden of proof placed upon him under a statute. In para 32, their lordships have observed thus: “An accused for discharging the burden of proof placed upon him under a statute need not examine himself. He may discharge his burden on the basis of the materials already brought on record. An accused has a constitutional right to maintain silence. Standard of proof on the part of an accused and that of the prosecution in a criminal case is different.” Again in para 44 and 45, the Apex Court has observed thus: “The courts must be on guard to see that merely on the application of presumption as contemplated under Section 139 of the Negotiable Instruments Act, the same may not lead to injustice or mistaken conviction. It is for the aforementioned reasons that we have taken into consideration the decisions operating in the field where the difficulty of proving a negative has been emphasised. It is not suggested that a negative can never be proved but there are cases where such difficulties are faced by the accused e.g. honest and reasonable mistake of fact. In a recent article “The presumption of Innocence and Reverve Burdens; a Balancing Duty published in 2007 CLJ (March Part) 142 it has been stated: “In determining whether a reverse burden is compatible with the presumption of innocence regard should also be had to the pragmatics of proof. How difficult would it be for the prosecution to prove guilt without the reverse burden? How easily could an innocent defendant discharge the reverse burden? But courts will not allow these pragmatic considerations to override the legitimate rights of the defendant. Pragmatism will have greater sway where the reverse burden would not pose the risk of great injustice-whether the offence is not too serious or the reverse burden only concerns a matter incidental to guilt. And greater weight will be given to prosecutorial efficiency in the regulatory environment.” 45. Pragmatism will have greater sway where the reverse burden would not pose the risk of great injustice-whether the offence is not too serious or the reverse burden only concerns a matter incidental to guilt. And greater weight will be given to prosecutorial efficiency in the regulatory environment.” 45. We are not oblivious of the fact that the said provision has been inserted to regulate the growing business, trade, commerce and industrial activities of the country and the strict liability to promote greater vigilance in financial matters and to safeguard the faith of the creditor in the drawer of the cheque which is essential to the economic life of a developing country like India. This, however, shall not mean that the courts shall put a blind eye to the ground realities. Statute mandates raising of presumption but it stops at that. It does not say how presumption drawn should be held to have rebutted. Other important principles of legal jurisprudence, namely, presumption of innocence as human rights and the doctrine of reverse burden introduced by Section 139 should delicately balanced. Such balancing acts, indisputably would largely depend upon the factual matrix of each case, the materials brought on record and having regard to legal principles governing the same.” 22. Keeping the above principles in mind let me consider whether in this case, the courts below were justified in holding the accused guilty of the offence punishable under Section 138 of the Act. 23. As noticed earlier, it is the specific case of the complainant that the accused as drawer of the cheques in question issued the cheques in favour of the person who in turn got the cheques discounted with the complainant Bank for consideration. Thus from the specific case of the complainant, it is clear that there was no privity of contract between the drawer of the cheques and the complainant bank. No doubt the moment the complainant Bank paid consideration to the payee of the cheques, the complainant Bank stepped into the shoes of the payee and that the presumptions available under Section 118 (a) and 139 of the Act would come into play. No doubt the moment the complainant Bank paid consideration to the payee of the cheques, the complainant Bank stepped into the shoes of the payee and that the presumptions available under Section 118 (a) and 139 of the Act would come into play. However, as held by the Hon’ble Supreme Court, it is not necessary for accused in all such cases to enter the witness box to rebut the statutory presumptions and he may discharge the burden of rebutting such presumption on the basis of the materials brought on record. Therefore, in the light of the above, even if presumption under Section 118(a) and 139 of the Act is drawn against the accused person, what is required to be considered is as to whether the accused have been able to rebut this presumption either by positive evidence led by him or through the materials already brought on record. The perusal of the judgments of the two courts below indicates that the courts below have not made any endeavour to find out as to whether the accused has been able to rebut the presumption. They have failed to give any finding on the specific statement of the accused that the cheques were issued to her brother as security for booking the flat and instructed her brother to present the Cheques with her prior information as she is suffering from financial crisis. The courts below have merely proceeded that the accused have not entered the witness box, therefore the statutory presumption has not been rebutted. This approach of the courts below, according to the above decision of the Apex Court, is perverse. The courts below ought to have considered the various circumstances to find out as to whether the statutory presumptions under Section 118(a) and 139 of the Act have been rebutted. 24. It may be noted that neither in the statutory notice issued prior to filing of complaint nor in the complaint filed by the bank, there is any averment made to the effect that accused issued cheques in favour of the payees towards discharge of any legally enforceable debt or liability due by the drawer to the payee. The only allegation made in these complaints is that the cheques issued by her has been returned unpaid as there was insufficiency of fund and directed the accused-petitioner to pay the entire amount. The only allegation made in these complaints is that the cheques issued by her has been returned unpaid as there was insufficiency of fund and directed the accused-petitioner to pay the entire amount. Thus the complaint is silent as to whether the cheques in question were issued for consideration and towards discharge of such legally enforceable debt or liability. Thus, the existence of debt or liability due by the drawer of the cheque to the payee is not indicated in the complaint. Even the evidence of P.Ws. 1, 2 & 3 examined on behalf of complainant bank also do not disclose as to whether the cheques in question were issued by the drawer to the payee for discharge of any debt or liability. According to evidence of prosecution witnesses, on the particular day, payees under the cheques came to the Bank and requested for discount of cheques issued by accused. It is not his say that payee disclosed that the drawer of cheques had issued them towards discharge of any debt or liability due and that the drawer owed amount to payee. The payee of the cheques who discounted the cheques with the complainant bank had not been examined to show that drawer of the cheques owed any money to him and that the cheques were issued for discharge of such debt. As noticed, the specific case of the complainant is that cheques issued by the accused were discounted by the payee of the cheques. Discounting of a cheque by the bank is a normal business operation of the bank. Mere fact that the cheques drawn by a third party in favour of its clients are discounted by the banks, does not lead to any privity of contract between the drawer of the cheque or the bank to attract criminal liability. Therefore, the aspect of civil liability cannot be imported into the question of criminal liability as the criminal liability has to be covered from the specific statutory provisions in that behalf. Admittedly, the cheques in question were not drawn in favour of the bank. The existence of any legally enforceable debt or liability between the drawer or the payee of the cheque is not even remotely indicated. May be the complainant Bank can enforce its civil right against the drawer and the payee of the cheques in a civil court. Admittedly, the cheques in question were not drawn in favour of the bank. The existence of any legally enforceable debt or liability between the drawer or the payee of the cheque is not even remotely indicated. May be the complainant Bank can enforce its civil right against the drawer and the payee of the cheques in a civil court. It is also evident from records that the complainant Bank filed a criminal case against the then Manager From this, it is clear that there was patent gross negligence on the part of the Manager who discounted the cheques. While considering question No.1, I have already held that there was patent gross negligence on the part of the Officer of complainant Bank in paying the amount to the payees by discounting the cheques, as such, the complainant Bank cannot be considered as “holder in due course” of these cheques. Therefore, the complainant cannot maintain criminal action against the drawer of cheques, for offence under Section 138 of the Act. Therefore, having regard to the various facts and circumstances of this case, I am of the opinion that the courts below are not justified in holding that the accused is guilty of offence under Section 138 of the Act. The statutory presumption even if they are drawn against the accused, in the light of the various circumstances indicated above, has stood rebutted. In the light of the discussion made above, I hold that the judgment of the courts below convicting the accused persons is perverse and contrary to the evidence on record. Therefore, it is liable to be set aside. Accordingly, I answer question No.3. In view of the above discussion, revision petition deserves to be allowed. 25. Another interesting issue in the instant case is that admittedly, the respondent-Bank has purchased/discounted the said cheques prior to the date mentioned in the Cheques and appropriated the said amount in the account of the Ramakant Singh POA Ashu Singh. As such, on the date of presentation of cheques there was no debt lying in the current account. The provision of 138 of the N.I. Act can be invoked only when there is debt. 26. As such, on the date of presentation of cheques there was no debt lying in the current account. The provision of 138 of the N.I. Act can be invoked only when there is debt. 26. In view of the aforesaid discussions and the judicial pronouncements, the instant revision application is hereby allowed and the judgment dated 24.07.2014, passed by the learned Principal Sessions Judge, Sahibganj in Criminal Appeal No.24 of 2014 and the judgment of conviction and order of sentence dated 14.02.2014, passed by the learned Judicial Magistrate, 1st Class, Sahibganj in P.C.R Case No.366 of 2007, T.R. Case No.151 of 2014 are set aside. 27. The petitioner is discharged from the liability of bail bonds. 28. Let the Lower Court Record be sent to the court concerned along with a copy of this order forthwith.