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2024 DIGILAW 85 (HP)

Sachin Gupta v. Paras Ram Chandel

2024-01-12

RAKESH KAINTHLA

body2024
JUDGMENT : Rakesh Kainthla, J. The present appeal is directed against the judgment dated 28.08.2009 passed by learned CJM, Shimla vide which the complaint filed by the appellant (complainant before the learned Trial Court) was dismissed. (Parties shall hereinafter be referred to in the same manner as they were arrayed before the learned Trial Court for convenience). 2. Briefly stated, the facts giving rise to the present appeal are that the complainant filed a complaint against the accused before the learned Trial Court for the commission of an offence punishable under Section 138 of the Negotiable Instruments Act (in short ‘NI Act’). It was asserted that the complainant is running a business under the name and style of M/s Shakti Traders at 35/6 Anaj Mandi, Shimla. He is the sole proprietor of the concern. The accused issued a Cheque (Ext.CW1/A) in the discharge of his legal liability on 16.03.2006 for a sum of Rs.50,000/- drawn on State Bank of India, Deha Branch. The complainant presented the cheque before his banker M/s UCO Bank Shimla from where it was sent to the bank of the accused. The bank of the accused dishonoured the cheque with the remark ‘insufficient funds’ and issued a memo (Ext. CW1/C). The Bank of the complainant returned the cheque with the memo (Ext.CW1/C) vide its memo (Ex.CW1/B). The complainant issued a notice (Ext.CW1/D) to the accused asking him to pay the amount within 15 days of the receipt of the notice. The notice was returned undelivered with an endorsement that the addressee had gone to Ludhiana. The accused knew about the notice and procured a false endorsement on the registered letter. He failed to pay the amount despite the knowledge of the notice; hence, the complaint was filed to take action against the accused. 3. The learned Trial Court summoned the accused. When the accused appeared, a notice of accusation was put to him for the commission of an offence punishable under Section 138 of the NI Act. The accused pleaded not guilty and claimed to be tried. 4. The complainant examined himself (CW1), Pyare Lal (CW2) and Babu Lal Sharma (CW3) to prove his case. 5. The accused in his statement recorded under Section 313 Cr.P.C. denied the case of the complainant. He stated that he had issued a security cheque, which was misused by the complainant. A false case was made against him. 4. The complainant examined himself (CW1), Pyare Lal (CW2) and Babu Lal Sharma (CW3) to prove his case. 5. The accused in his statement recorded under Section 313 Cr.P.C. denied the case of the complainant. He stated that he had issued a security cheque, which was misused by the complainant. A false case was made against him. No defence was sought to be adduced by the accused. 6. The learned Trial Court held that the complainant failed to produce the Books of Account or their abstract to show the liability of Rs.50,000/-. Non-production of the Books of Account renders the complaint doubtful. He admitted in his cross-examination that the cheque was issued as a security. Hence, the possibility of covering the past transaction not permissible under the law being barred by time could not be ruled out. The complainant also admitted that the accused did not owe any amount to him at the time of the issuance of the cheque and his claim that he had withdrawn the amount from the Bank was not corroborated by summoning the record from the Bank. Reliance was placed upon the judgment of the Hon’ble Supreme Court in M.S.Narayana Menon @ Mani vs. State of Kerala & Anr., 2006 (3) Criminal Court Cases 665 (S.C), Sudhir Kumar Bhalla vs. Jagdish Chand & ors., 2009 (2) Criminal Court Cases 199 (S.C.) and judgment of this Court in M/s Kamal General Store vs. Kishori Lal Vij Latest HLJ 2008 (HP) 1474 and the accused was acquitted. 7. Being aggrieved from the judgment passed by the learned Trial Court, the present appeal has been filed asserting that the learned Trial Court failed to properly appreciate the material placed before it. The accused did not step into the witness box and an adverse inference should have been drawn against him. No defence was raised by the accused to discredit the evidence of the complainant. The accused asserted that the cheque was issued as a security, as well as the cheque was taken forcibly by intimidating him 5-6 years ago in connection with some old transactions. These defences are contradictory and cannot stand together. Learned Trial Court did not consider the presumption under Section 139 of the Negotiable Instruments Act. Therefore, it was prayed that the present appeal be allowed and the judgment passed by the learned trial Court be set aside. 8. I have heard Mr. These defences are contradictory and cannot stand together. Learned Trial Court did not consider the presumption under Section 139 of the Negotiable Instruments Act. Therefore, it was prayed that the present appeal be allowed and the judgment passed by the learned trial Court be set aside. 8. I have heard Mr. Viswas Kaushal, learned counsel for the appellants/complainants and Mr. R.S. Chandel, learned counsel for the respondent/accused. 9. Mr. Viswas Kaushal, learned counsel for the appellants/complainant submitted that the issuance of cheque was not disputed by the accused and the learned Trial Court should have raised a presumption regarding the consideration. No evidence was required to prove that the cheque was issued in discharge of the legal liability because Section 139 provides a presumption to this effect. Learned Trial Court erred in dismissing the complaint on failure to produce the Account Books. Hence, he prayed that the present appeal be allowed and the judgment passed by learned Trial Court be set aside. 10. Mr. R.S. Chandel, learned counsel for the respondent supported the judgment passed by the learned Trial Court and submitted that no interference is required with the same. 11. I have given considerable thought to the submissions at the bar and have gone through the records carefully. 12. The present appeal has been filed against an order of acquittal. The Hon’ble Supreme Court laid down the parameters of deciding an appeal against acquittal in Jafarudheen v. State of Kerala, (2022) 8 SCC 440 , as under:- “Scope of Appeal filed against the Acquittal: 25. While dealing with an appeal against acquittal by invoking Section 378 of the Cr.PC, the Appellate Court has to consider whether the Trial Court's view can be termed as a possible one, particularly when evidence on record has been analyzed. The reason is that an order of acquittal adds up to the presumption of innocence in favour of the accused. Thus, the Appellate Court has to be relatively slow in reversing the order of the Trial Court rendering acquittal. Therefore, the presumption in favour of the accused does not get weakened but only strengthened. Such a double presumption that enures in favour of the accused has to be disturbed only by thorough scrutiny on the accepted legal parameters." 13. This position was reiterated in Siju Kurian versus State of Karnataka 2023 online SCC 429, wherein it was held:- “15. Therefore, the presumption in favour of the accused does not get weakened but only strengthened. Such a double presumption that enures in favour of the accused has to be disturbed only by thorough scrutiny on the accepted legal parameters." 13. This position was reiterated in Siju Kurian versus State of Karnataka 2023 online SCC 429, wherein it was held:- “15. One of the main contentions raised by the learned counsel appearing for the appellant is to the effect that the High Court ought not to have interdicted with the judgment of the acquittal passed by the Trial Court and only in the event of the judgment of the Trial court was riddled with perversity and the view taken by the Trial Court was not a possible view, same could have been reversed by relying upon the judgment of this Court in case of Murugesan V. State through the Inspector of police (2012) 10 SCC 383 whereunder it came to be held as follows: “33. The expressions “erroneous”, “wrong” and “possible” are defined in the Oxford English Dictionary in the following terms: “erroneous.— wrong; incorrect. wrong.—(1) not correct or true, mistaken. (2) unjust, dishonest, or immoral. possible.—(1) capable of existing, happening, or being achieved. (2) that may exist or happen, but that is not certain or probable.” 34. It will be necessary for us to emphasize that a possible view denotes an opinion, which can exist or be formed irrespective of the correctness or otherwise of such an opinion. A view taken by a court lower in the hierarchical structure may be termed as erroneous or wrong by a superior court upon a mere disagreement. But such a conclusion of the higher court would not take the view rendered by the subordinate court outside the arena of a possible view. The correctness or otherwise of any conclusion reached by a court has to be tested on the basis of what the superior judicial authority perceives to be the correct conclusion. A possible view, on the other hand, denotes a conclusion, which can reasonably be arrived at regardless of the fact where it is agreed upon or not by the higher court. The fundamental distinction between the two situations has to be kept in mind. A possible view, on the other hand, denotes a conclusion, which can reasonably be arrived at regardless of the fact where it is agreed upon or not by the higher court. The fundamental distinction between the two situations has to be kept in mind. So long as the view taken by the trial court can be reasonably formed, regardless of whether the High Court agrees with the same or not, the view taken by the trial court cannot be interdicted and that of the High Court supplanted over and above the view of the trial court.” 16. It need not be restated that it would be open for the High Court to re-apprise the evidence and conclusions drawn by the Trial Court and in the case of the judgment of the trial court being perverse that is contrary to the evidence on record, then in such circumstances the High Court would be justified in interfering with the findings of the Trial Court and/or reversing the finding of the Trial Court. In Gamini Bala Koteswara Rao v. State of Andhra Pradesh (2009) 10 SCC 636 : AIR 2010 SC 589 it has been held by this Court as under: “14. We have considered the arguments advanced and heard the matter at great length. It is true, as contended by Mr Rao, that interference in an appeal against an acquittal recorded by the trial court should be rare and in exceptional circumstances. It is, however, well settled by now that it is open to the High Court to reappraise the evidence and conclusions drawn by the trial court but only in a case when the judgment of the trial court is stated to be perverse. The word “perverse” in terms as understood in law has been defined to mean “against the weight of evidence”. We have to see accordingly as to whether the judgment of the trial court which has been found perverse by the High Court was in fact so. 17. The Appellate Court may reverse the order of acquittal in the exercise of its powers and there is no indication in the Code of any limitation or restriction having been placed on the High Court in the exercise of its power as an Appellate court. 17. The Appellate Court may reverse the order of acquittal in the exercise of its powers and there is no indication in the Code of any limitation or restriction having been placed on the High Court in the exercise of its power as an Appellate court. No distinction can be drawn as regards the power of the High Court in dealing with an appeal, between an appeal from an order of acquittal and an appeal from a conviction. The Code of Criminal Procedure does not place any fetter on the exercise of the power to review at large the evidence upon which the order of acquittal was founded and to conclude that upon that evidence the order of acquittal should be reversed. 18. In the case of Sheo Swarup v. King Emperor AIR 1934 PC 227 , it has been held by the Privy Council as under: But in exercising the power conferred by the Code and before reaching its conclusions upon fact, the High Court should and will always give proper weight and consideration to such matters as: (1) The views/opinion of the trial judge as to the credibility of the witnesses; (2) The presumption of innocence in favour of the accused; (3) The right of the accused to the benefit of any doubt; and (4) The slowness of an appellate court in disturbing a finding of fact arrived at by a judge who had the advantage of seeing the witnesses. 19. This Court has time and again reiterated the powers of the Appellate Court while dealing with the appeal against an order of acquittal and laid down the general principles in the matter of Chandrappa v. State of Karnataka (2007) 4 SCC 415 to the following effect: “42. From the above decisions, in our considered view, the following general principles regarding the powers of the Appellate Court while dealing with an appeal against an order of acquittal emerge: (1) An Appellate court has full power to review, re-appreciate and reconsider the evidence upon which the order of acquittal is founded. (2) The Criminal Procedure Code, 1973 puts no limitation, restriction or condition on the exercise of such power and an Appellate court on the evidence before it may reach its own conclusion, both on questions of fact and law. (2) The Criminal Procedure Code, 1973 puts no limitation, restriction or condition on the exercise of such power and an Appellate court on the evidence before it may reach its own conclusion, both on questions of fact and law. (3) Various expressions, such as, “substantial and compelling reasons”, “good and sufficient grounds”, “very strong circumstances”, “distorted conclusions”, “glaring mistakes”, etc. are not intended to curtail extensive powers of an Appellate court in an appeal against acquittal. Such phraseologies are more in the nature of “flourishes of language” to emphasise the reluctance of an Appellate court to interfere with acquittal than to curtail the power of the court to review the evidence and to come to its own conclusion. (4) An Appellate court, however, must bear in mind that in case of acquittal, there is a double presumption in favour of the accused. Firstly, the presumption of innocence is available to him under the fundamental principle of criminal jurisprudence that every person shall be presumed to be innocent unless he is proved guilty by a competent court of law. Secondly, the accused having secured his acquittal, the presumption of his innocence is further reinforced, reaffirmed and strengthened by the trial court. (5) If two reasonable conclusions are possible on the basis of the evidence on record, the Appellate court should not disturb the finding of acquittal recorded by the trial court.” 14. The present appeal has to be adjudicated in the light of the judgments of the Hon'ble Supreme Court. 15. The accused admitted in his statement recorded under Section 313 of Cr.P.C. that he had issued a cheque but he claimed that the cheque was issued as a security; hence, the signatures on the cheque were not disputed by the accused. It was laid down by this Court in Naresh Verma vs. Narinder Chauhan 2020 (1) Shim. L.C. 398 that where the accused had not disputed his signatures on the cheque, the Court has to presume that it was issued in discharge of legal liability and the burden would shift upon the accused to rebut the presumption. It was observed:- “8. Once signatures on the cheque are not disputed, the plea with regard to the cheque having not been issued towards discharge of lawful liability, rightly came to be rejected by learned Courts below. It was observed:- “8. Once signatures on the cheque are not disputed, the plea with regard to the cheque having not been issued towards discharge of lawful liability, rightly came to be rejected by learned Courts below. Reliance is placed upon Hiten P. Dalal v. Bartender Nath Bannerji, 2001 (6) SCC 16 , wherein it has been held as under: "The words 'unless the contrary is proved' which occur in this provision make it clear that the presumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible. A fact is said to be proved when its existence is directly established or when upon the material before it the Court finds its existence to be so probable that a reasonable man would act on the supposition that it exists. Unless, therefore, the explanation is supported by proof, the presumption created by the provision cannot be said to be rebutted......" 9. S.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 nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability. 16. Similar is the judgment in Basalingappa vs. Mudibasappa 2019 (5) SCC 418 wherein it was held: 24. Applying the proposition of law as noted above, in the facts of the present case, it is clear that the signature on the cheque having been admitted, a presumption shall be raised under Section 139 that the cheque was issued in discharge of debt or liability. 17. This position was reiterated in M/S Kalamani Tex and another Versus P. Balasubramanian 2021 (5) SCC 283 wherein it was held: “14. Adverting to the case in hand, we find on a plain reading of its judgment that the trial Court completely overlooked the provisions and failed to appreciate the statutory presumption drawn under Section 118 and Section 139 of NIA. The Statute mandates that once the signature(s) of an accused on the cheque/negotiable instrument are established, then these ‘reverse onus’ clauses become operative. In such a situation, the obligation shifts upon the accused to discharge the presumption imposed upon him. The Statute mandates that once the signature(s) of an accused on the cheque/negotiable instrument are established, then these ‘reverse onus’ clauses become operative. In such a situation, the obligation shifts upon the accused to discharge the presumption imposed upon him. This point of law has been crystallized by this Court in Rohitbhai Jivanlal Patel v. State of Gujarat (2019) 18 SCC 106 , 18 in the following words: “In the case at hand, even after purportedly drawing the presumption under Section 139 of the NI Act, the trial court proceeded to question the want of evidence on the part of the complainant as regards the source of funds for advancing loan to the accused and want of examination of relevant witnesses who allegedly extended him money for advancing it to the accused. This approach of the trial court had been at variance with the principles of presumption in law. After such presumption, the onus shifted to the accused and unless the accused had discharged the onus by bringing on record such facts and circumstances as to show the preponderance of probabilities tilting in his favour, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of funds for advancing loan to the appellant-accused…..” 15. Once the 2nd Appellant had admitted his signatures on the cheque and the Deed, the trial Court ought to have presumed that the cheque was issued as consideration for a legally enforceable debt. The trial Court fell in error when it called upon the Complainant-Respondent to explain the circumstances under which the appellants were liable to pay. Such an approach of the trial Court was directly in the teeth of the established legal position as discussed above and amounts to a patent error of law. 16. No doubt, and as correctly argued by senior counsel for the appellants, the presumptions raised under Section 118 and Section 139 are rebuttable in nature. As held in MS Narayana Menon v. State of Kerela (2006) 6 SCC 39 , 32, which was relied upon in Basalingappa (supra), a probable defence needs to be raised, which must meet the standard of “preponderance of probability”, and not a mere possibility. These principles were also affirmed in the case of Kumar Exports (supra), wherein it was further held that bare denial of passing of consideration would not aid the case of the accused.” 18. These principles were also affirmed in the case of Kumar Exports (supra), wherein it was further held that bare denial of passing of consideration would not aid the case of the accused.” 18. This presumption was explained by the Hon’ble Supreme Court in Triyambak S. Hegde Versus Sripad 2022 (1) SCC 742 as under: 11. From the facts arising in this case and the nature of the rival contentions, the record would disclose that the signature on the documents at Exhibits P-6 and P-2 is not disputed. Exhibit P-2 is the dishonoured cheque based on which the complaint was filed. From the evidence tendered before the JMFC, it is clear that the respondent has not disputed the signature on the cheque. If that be the position, as noted by the courts below a presumption would arise under Section 139 in favour of the appellant who was the holder of the cheque. Section 139 of the N.I. Act reads as hereunder:- "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." 12 Insofar as the payment of the amount by the appellant in the context of the cheque having been signed by the respondent, the presumption for the passing of the consideration would arise as provided under Section 118(a) of N.I. Act which reads as hereunder: - "118. Presumptions as to negotiable instruments - Until the contrary is proved, the following presumptions shall be made: - (a) of consideration - that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration." 13. The above-noted provisions are explicit to the effect that such presumption would remain until the contrary is proved. The learned counsel for the appellant in that regard has relied on the decision of this Court in K. Bhaskaran vs. Sankaran Vaidhyan Balan & Anr., 1999 (7) SCC 510 wherein it is held as hereunder: "9. The above-noted provisions are explicit to the effect that such presumption would remain until the contrary is proved. The learned counsel for the appellant in that regard has relied on the decision of this Court in K. Bhaskaran vs. Sankaran Vaidhyan Balan & Anr., 1999 (7) SCC 510 wherein it is held as hereunder: "9. As the signature in the cheque is admitted to be that of the accused, the presumption envisaged in Section 118 of the Act can legally be inferred that the cheque was made or drawn for consideration on the date on which the cheque bears. Section 139 of the Act enjoins the Court to presume that the holder of the cheque received it for the discharge of any debt or liability. The burden was on the accused to rebut the aforesaid presumption. The Trial Court was not persuaded to rely on the interested testimony of DW-1 to rebut the presumption. The said finding was upheld by the High Court. It is not now open to the accused to contend differently on that aspect." 14. The learned counsel for the respondent has however referred to the decision of this Court in Basalingappa vs. Mudibasappa, 2019 (5) SCC 418 wherein it is held as hereunder :- "25. We having noticed the ratio laid down by this Court in the above cases on Sections 118 (a) and 139, we now summarise the principles enumerated by this Court in the following manner: 25.1. Once the execution of the cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability. 25.2. The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of the preponderance of probabilities. 25.3. To rebut the presumption, it is open for the accused to rely on evidence led by him or the 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. 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. 25.5. It is not necessary for the accused to come into the witness box to support his defence. 26. Applying the proposition of law as noted above, in the facts of the present case, it is clear that the signature on the cheque having been admitted, a presumption shall be raised under Section 139 that the cheque was issued in discharge of debt or liability. The question to be looked into is as to whether any probable defence was raised by the accused. In cross-examination of PW1, when the specific question was put that the cheque was issued in relation to a loan of Rs.25,000 taken by the accused, PW1 said that he does not remember. PW1 in his evidence admitted that he retired in 1997 on which date he received a monetary benefit of Rs.8 lakhs, which was encashed by the complainant. It was also brought in the evidence in the evidence that in the year 2010, the complainant entered into a sale agreement for which he paid an amount of Rs.4,50,000 to Balana Gouda towards sale consideration. Payment of Rs.4,50,000 being admitted in the year 2010 and a further payment of a loan of Rs. 50,000 with regard to which Complaint No.119 of 2012 was filed by the complainant, copy of which complaint was also filed as Ext. D-2, there was a burden on the complainant to prove his financial capacity. In the years 2010-2011, as per the own case of the complainant, he made a payment of Rs.18 lakhs. During his cross-examination, when the financial capacity to pay Rs. 6 lakhs to the accused was questioned, there was no satisfactory reply given by the complainant. The evidence on record, thus, is a probable defence on behalf of the accused, which shifted the burden on the complainant to prove his financial capacity and other facts." 15. During his cross-examination, when the financial capacity to pay Rs. 6 lakhs to the accused was questioned, there was no satisfactory reply given by the complainant. The evidence on record, thus, is a probable defence on behalf of the accused, which shifted the burden on the complainant to prove his financial capacity and other facts." 15. In that light, it is contended that the very materials produced by the appellant and the answers relating to lack of knowledge of property details by PW-1 in his cross-examination would indicate that the transaction is doubtful and no evidence is tendered to indicate that the amount was paid. In such an event, it was not necessary for the respondent to tender rebuttal evidence but the case put forth would be sufficient to indicate that the respondent has successfully rebutted the presumption. 16. On the position of law, the provisions referred to in Sections 118 and 139 of N.I. Act as also the enunciation of law as made by this Court needs no reiteration as there is no ambiguity whatsoever. In, Basalingappa vs. Mudibasappa (supra) relied on by the learned counsel for the respondent, though on facts the ultimate conclusion therein was against raising presumption, the facts and circumstances are entirely different as the transaction between the parties as claimed in the said case is peculiar to the facts of that case where the consideration claimed to have been paid did not find favour with the Court keeping in view the various transactions and extent of the amount involved. However, the legal position relating to presumption arising under Sections 118 and 139 of N.I. Act on a signature being admitted has been reiterated. Hence, whether there is a rebuttal or not would depend on the facts and circumstances of each case. 19. This position was reiterated in Tedhi Singh vs. Narayan Dass Mahant 2022 (6) SCC 735 wherein it was held : 7. It is true that this is a case under Section 138 of the Negotiable Instruments Act. Section 139 of the N.I. Act provides that the Court shall presume 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. This presumption, however, is expressly made subject to the position being proved to the contrary. Section 139 of the N.I. Act provides that the Court shall presume 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. This presumption, however, is expressly made subject to the position being proved to the contrary. In other words, it is open to the accused to establish that there is no consideration received. It is in the context of this provision that the theory of 'probable defence' has grown. In an earlier judgment, in fact, which has also been adverted to in Basalingappa (supra), this Court notes that Section 139 of the N.I. Act is an example of reverse onus [see (2010) 11 SCC 441 ). It is also true that this Court has found that the accused is not expected to discharge an unduly high standard of proof. It is accordingly that the principle has developed that all which the accused needs to establish is a probable defence. As to whether a probable defence has been established is a matter to be decided on the facts of each case on the conspectus of evidence and circumstances that exist. 20. Similar is the judgment in P Rasiya vs. Abdul Nazeer 2022 (3) Crimes 343 wherein it was observed: “As per Section 139 of the N.I. Act, 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 discharge, in whole or in part, of any debt or other liability. Therefore, once the initial burden is discharged by the Complainant that the cheque was issued by the accused and the signature and the issuance of the cheque is not disputed by the accused, in that case, the onus will shift upon the accused to prove the contrary that the cheque was not for any debt or other liability. The presumption under Section 139 of the N.I. Act is a statutory presumption and thereafter, once it is presumed that the cheque is issued in whole or in part of any debt or other liability which is in favour of the Complainant/holder of the cheque, in that case, it is for the accused to prove the contrary.” 21. The presumption under Section 139 of the N.I. Act is a statutory presumption and thereafter, once it is presumed that the cheque is issued in whole or in part of any debt or other liability which is in favour of the Complainant/holder of the cheque, in that case, it is for the accused to prove the contrary.” 21. This position was reiterated in Rajesh Jain v. Ajay Singh, (2023) 10 SCC 148 : 2023 SCC OnLine SC 1275 wherein it was observed at page 161: 33. The NI Act provides for two presumptions: Section 118 and Section 139. Section 118 of the Act inter alia directs that it shall be presumed until the contrary is proved, that every negotiable instrument was made or drawn for consideration. Section 139 of the Act stipulates that “unless the contrary is proved, it shall be presumed, that the holder of the cheque received the cheque, for the discharge of, whole or part of any debt or liability”. It will be seen that the “presumed fact” directly relates to one of the crucial ingredients necessary to sustain a conviction under Section 138. [The rules discussed hereinbelow are common to both the presumptions under Section 139 and Section 118 and are hence, not repeated— reference to one can be taken as reference to another] 34. Section 139 of the NI Act, which takes the form of a “shall presume” clause is illustrative of a presumption of law. Because Section 139 requires that the Court “shall presume” the fact stated therein, it is obligatory on the Court to raise this presumption in every case where the factual basis for the raising of the presumption had been established. But this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary as is clear from the use of the phrase “unless the contrary is proved”. 35. The Court will necessarily presume that the cheque had been issued towards the discharge of a legally enforceable debt/liability in two circumstances. Firstly, when the drawer of the cheque admits issuance/execution of the cheque and secondly, in the event where the complainant proves that the cheque was issued/executed in his favour by the drawer. The circumstances set out above form the fact(s) which bring about the activation of the presumptive clause. [Bharat Barrel & Drum Mfg. Co. Firstly, when the drawer of the cheque admits issuance/execution of the cheque and secondly, in the event where the complainant proves that the cheque was issued/executed in his favour by the drawer. The circumstances set out above form the fact(s) which bring about the activation of the presumptive clause. [Bharat Barrel & Drum Mfg. Co. v. Amin Chand Payrelal [Bharat Barrel & Drum Mfg. Co. v. Amin Chand Payrelal, (1999) 3 SCC 35 ] ] 36. Recently, this Court has gone to the extent of holding that presumption takes effect even in a situation where the accused contends that a blank cheque leaf was voluntarily signed and handed over by him to the complainant. [Bir Singh v. Mukesh Kumar [Bir Singh v. Mukesh Kumar, (2019) 4 SCC 197 : (2019) 2 SCC (Civ) 309 : (2019) 2 SCC (Cri) 40]]. Therefore, the mere admission of the drawer's signature, without admitting the execution of the entire contents in the cheque, is now sufficient to trigger the presumption. 37. As soon as the complainant discharges the burden to prove that the instrument, say a cheque, was issued by the accused for discharge of debt, the presumptive device under Section 139 of the Act helps shifting the burden on the accused. The effect of the presumption, in that sense, is to transfer the evidential burden on the accused of proving that the cheque was not received by the Bank towards the discharge of any liability. Until this evidential burden is discharged by the accused, the presumed fact will have to be taken to be true, without expecting the complainant to do anything further. 38. John Henry Wigmore [John Henry Wigmore and the Rules of Evidence: The Hidden Origins of Modern Law] on Evidence states as follows: “The peculiar effect of the presumption of law is merely to invoke a rule of law compelling the Jury to reach the conclusion in the absence of evidence to the contrary from the opponent but if the opponent does offer evidence to the contrary (sufficient to satisfy the Judge's requirement of some evidence), the presumption ‘disappears as a rule of law and the case is in the Jury's hands free from any rule’.” 39. The standard of proof to discharge this evidential burden is not as heavy as that usually seen in situations where the prosecution is required to prove the guilt of an accused. The standard of proof to discharge this evidential burden is not as heavy as that usually seen in situations where the prosecution is required to prove the guilt of an accused. The accused is not expected to prove the non-existence of the presumed fact beyond reasonable doubt. The accused must meet the standard of “preponderance of probabilities”, similar to a defendant in a civil proceeding. [Rangappa v. Sri Mohan [Rangappa v. Sri Mohan, (2010) 11 SCC 441 : (2010) 4 SCC (Civ) 477 : (2011) 1 SCC (Cri) 184 : AIR 2010 SC 1898 ]] 40. In order to rebut the presumption and prove to the contrary, it is open to the accused to raise a probable defence wherein the existence of a legally enforceable debt or liability can be contested. The words “until the contrary is proved” occurring in Section 139 do not mean that the accused must necessarily prove the negative that the instrument is not issued in discharge of any debt/liability but the accused has the option to ask the Court to consider the non-existence of debt/liability so probable that a prudent man ought, under the circumstances of the case, to act upon the supposition that debt/liability did not exist. [Basalingappa v. Mudibasappa [Basalingappa v. Mudibasappa, (2019) 5 SCC 418 : (2019) 2 SCC (Cri) 571 : AIR 2019 SC 1983 ] ; see also Kumar Exports v. Sharma Carpets [Kumar Exports v. Sharma Carpets, (2009) 2 SCC 513 : (2009) 1 SCC (Civ) 629 : (2009) 1 SCC (Cri) 823]] 41. In other words, the accused is left with two options. The first option—of proving that the debt/liability does not exist—is to lead defence evidence and conclusively establish with certainty that the cheque was not issued in discharge of a debt/liability. The second option is to prove the non-existence of debt/liability by a preponderance of probabilities by referring to the particular circumstances of the case. The preponderance of probability in favour of the accused's case may be even fifty-one to forty- nine and arising out of the entire circumstances of the case, which includes: the complainant's version in the original complaint, the case in the legal/demand notice, complainant's case at the trial, as also the plea of the accused in the reply notice, his Section 313CrPC statement or at the trial as to the circumstances under which the promissory note/cheque was executed. All of them can raise a preponderance of probabilities justifying a finding that there was “no debt/liability”. [Kumar Exports v. Sharma Carpets [Kumar Exports v. Sharma Carpets, (2009) 2 SCC 513 : (2009) 1 SCC (Civ) 629 : (2009) 1 SCC (Cri) 823]] 22. Hence, there is a force in the submission of learned counsel for the appellant/accused that the Court was bound to raise a presumption that the cheque was issued in the discharge of the legal liability. 23. The complainant admitted in his cross-examination that the cheque was issued by the accused as a security. He also admitted that on the date of the issuance of the cheque, the accused did not have any liability to pay the money. 24. It was laid down by the Hon'ble Supreme Court in Sampelly Satyanarayana Rao vs. Indian Renewable Energy Development Agency Limited 2016 (10) SCC 458 that issuing a cheque toward security will attract the liability for the commission of an offence punishable under Section 138 of N.I. Act, if on the date of issuance of cheque, there was subsisting liability and not otherwise. It was observed:- “10. We have given due consideration to the submission advanced on behalf of the appellant as well as the observations of this Court in Indus Airways Private Limited versus Magnum Aviation Private Limited (2014) 12 SCC 53 with reference to the explanation to Section 138 of the Act and the expression “for the discharge of any debt or other liability” occurring in Section 138 of the Act. We are of the view that the question of whether a post-dated cheque is for “discharge of debt or liability” depends on the nature of the transaction. If on the date of the cheque liability or debt exists or the amount has become legally recoverable, the Section is attracted and not otherwise.” (Emphasis supplied) 25. In the present case, it was admitted that the accused was not liable to pay any amount on the date of issuance of the cheque, hence, the complainant was required to show that the liability arose after the issuance of the cheque and it subsisted on the date of the presentation of the cheque. However, in the present case, the complainant does not mention any such fact. Paragraph 2 of the complaint reads that the accused issued a cheque for lawful and valuable consideration and in the discharge of his liability. However, in the present case, the complainant does not mention any such fact. Paragraph 2 of the complaint reads that the accused issued a cheque for lawful and valuable consideration and in the discharge of his liability. It shows that on the date of the issuance of the cheque, the accused had a liability as per the complainant. However, that is not correct in view of the statement of the complainant that the accused did not have any liability on the date of the issuance of the cheque; hence, the complaint does not establish that liability was created after the issuance of the cheque and before the date of presentation. 26. The complainant stated on oath that the accused used to sell Gucchi to him and he had advanced the money in lieu of which, the accused issued a cheque for Rs. 50,000/-. This cheque was issued in discharge of lawful and valuable consideration and the accused assured that the cheque would be honoured on presentation. The statement on oath also shows that the complainant had a subsisting liability on the date of the issuance of the cheque, which is not correct in view of the admission made in the cross-examination. Therefore, the statement on oath also does not establish that the liability was created after the issuance of the cheque and persisted till the date of the presentation of the cheque. 27. The complainant stated in his cross-examination that he had withdrawn Rs.50,000/- on the date of issuance of the cheque. He could not mention his account number. He could not produce any document regarding the withdrawal of the amount. He could not mention the denomination of the currency notes. Thus, the accused attempted to show in the cross-examination that the liability was created after the issuance of the cheque and the complainant withdrew Rs.50,000/- which was handed over to the accused. This was never the case of the complainant. Even though, there was no evidence to establish this version. The person, who withdrew the cash or the bank statement of the complainant showing the withdrawal of the amount was not produced before the Court. The production of the evidence to establish the payment of money was essential because of the statement of the complainant that the accused was not liable to pay any amount on the date of the issuance of the cheque. 28. The production of the evidence to establish the payment of money was essential because of the statement of the complainant that the accused was not liable to pay any amount on the date of the issuance of the cheque. 28. It was submitted that the complainant is not required to provide any evidence to show the payment of the money to the accused because it is a matter of presumption under Section 139. There is no dispute with this general proposition of law; however, in the present case, this general proposition of law will not apply in view of the admission of the complainant that the accused was not liable to pay any amount on the date of the issuance of the cheque, which has the effect of rebutting the presumption attached to the cheque. Therefore, no advantage can be derived from Section 139 of the NI Act. 29. It was submitted that the accused did not step into the witness box and the version of the complainant was to be accepted as correct. This is not acceptable. It was laid down by Hon’ble Supreme Court in Tedhi Singh Versus Narayan Dass Mahant (2022) 6 SCC 735 , that the accused can rely upon the cross-examination of the complainant and his witnesses to rebut the presumption. It was observed: “9. The Trial Court and the First Appellate Court have noted that in the case under Section 138 of the N. I. Act, the complainant need not show in the first instance that he had the capacity. The proceedings under Section 138 of the N. I. Act is not civil suits. At the time, when the complainant gives his evidence unless a case is set up in the reply notice to the statutory notice sent, that the complainant did not have the wherewithal, it cannot be expected of the complainant to initially lead evidence to show that he had the financial capacity. To that extent, the Courts in our view were right in holding on those lines. However, the accused has the right to demonstrate that the complainant in a particular case did not have the capacity and therefore, the case of the accused is acceptable which he can do by producing independent materials, namely, by examining his witnesses and producing documents. To that extent, the Courts in our view were right in holding on those lines. However, the accused has the right to demonstrate that the complainant in a particular case did not have the capacity and therefore, the case of the accused is acceptable which he can do by producing independent materials, namely, by examining his witnesses and producing documents. It is also open to him to establish the very same aspect by pointing to the materials produced by the complainant himself. He can further, more importantly, achieve this result through the cross-examination of the witnesses of the complainant. Ultimately, it becomes the duty of the Courts to consider carefully and appreciate the totality of the evidence and then come to a conclusion whether in the given case, the accused has shown that the case of the complainant is in peril for the reason that the accused has established a probable defence.” 30. Therefore, it was not essential for the accused to step into the witness box and he could have relied upon the cross-examination of the complainant and his witnesses. 31. Thus, the learned Trial Court had rightly held that the version of the complainant regarding the payment of the money to the accused was not established, hence, his version that the cheque was issued in discharge of the legal liability was not proved before the Court. This was a reasonable view, which could have been taken in the circumstances of the case and no interference is required with the same. 32. No other point was urged. 33. Hence, the judgment passed by the learned Trial Court is fully sustainable, therefore, the present appeal fails and the same is dismissed.