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2025 DIGILAW 166 (GUJ)

Prakash Pandurang Shinde v. State of Gujarat

2025-02-27

S.V.PINTO

body2025
ORDER : 1. The present application is filed by the applicants – legal heirs of the original complainant under Section 378(4) of the Code of Criminal Procedure, 1973 (for short “Cr.P.C.”) seeking leave to file an appeal against the judgment and order dated 06.10.2021 passed by the learned 24 th Additional Chief Judicial Magistrate, Surat (hereinafter referred to as the “learned Trial Court”) in Criminal Case No. 9016 of 2017, whereby the respondent No. 2 - original accused came to be acquitted from the offence under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as ‘the NI Act”). 1.1 The parties are hereinafter referred to as “the complainant” and “the accused” as they stood in the original case for the sake of convenience, clarity and brevity. 2. The brief facts culled out from the memo of the present application as well as the impugned judgment and order and paper book filed by the applicant are as under: 2.1 The complainant filed a complaint against the accused under Section 138 of the Act, mainly contending that the accused had taken a loan of Rs. 20,00,000/- from the applicant on 19.11.2010 for business purposes at the rate of 1% interest and an agreement was executed and the accused had issued cheque No.515618 for the amount of Rs. 25,00,000/- dated 12.01.2017 from his account with Bank of Baroda, City Light Branch, Surat. The complainant deposited the cheque in his bank and the cheque was dishonored and the reason mentioned in the return memo dated 17.01.2017 was “Account Closed”. The complainant sent the statutory demand notice to the accused on 15.02.2017 and no payment was made and hence the complainant filed a criminal complaint before the Court of the Additional Chief Judicial Magistrate, Surat under Section 138 of the N I Act, 1881 which was registered as Criminal Case No. 9016 of 2017. 2.2 The accused was served with the summons and appeared before the learned Trial Court and his plea was recorded at Exhibit 09 and the evidence of the complainant was taken on record. 2.2 The accused was served with the summons and appeared before the learned Trial Court and his plea was recorded at Exhibit 09 and the evidence of the complainant was taken on record. The complainant and witness Rajeshkumar Sheshmani Parmar were examined on oath and 09 documentary evidences were produced in support of the case and after the closing pursis at Exhibit 35 was filed, the further statement of the accused under Section 313 of the Code of Criminal Procedure was recorded, wherein the accused stated that as per evidence produced at exhibit 14 the applicant has no right to send the statutory notice and the cheques were obtained illegally and have been forged. The facts mentioned in the examination in chief and in the complaint are false and a false complaint has been filed and a complaint filed by the husband of the accused dated 25.03.2017 is produced. The accused refused to step into the witness box and after the evidence of the accused was closed the arguments of the learned advocates for both the parties were heard and by the impugned judgment and order, the learned Trial Court acquitted the accused from the offence under Section 138 of the NI Act. 3. Being aggrieved and dissatisfied with the same, the applicants – legal heirs of the original complainant have preferred the present application seeking leave to appeal mainly stating that the learned Trial Court has not properly interpreted the evidence and has misread the evidence and the impugned judgment is perverse, erroneous and contrary to law. 4. Heard learned advocate Mr. Jitendra H. Singh appearing for the applicants, learned APP Mr. Bhargav Pandya for the respondent – State and learned advocate Mr. Nisarg Shah for Ms. Ashlesha M. Patel for Respondent No. 2. 5. Learned Advocate Mr. Jitendra H. Singh for the applicants submits that the learned Trial Court has not appreciated that the complainant has successfully established that the cheque in question was issued by the accused from the bank account maintained by him. The complainant has proved that the cheque was written by the accused and it was dishonoured and as the complainant is the holder in due course of the cheque in question the statutory presumption under Section 139 of the NI Act is to be drawn in favour of the complainant. The complainant has proved that the cheque was written by the accused and it was dishonoured and as the complainant is the holder in due course of the cheque in question the statutory presumption under Section 139 of the NI Act is to be drawn in favour of the complainant. The learned Trial Court has not appreciated the provisions of Section 118 and 138 of the NI Act in proper perspective. The oral contract is not negated by the accused and the fact of the amount paid by the original complainant to the accused is also not negated, but the learned Trial Court has disbelieved the same. The accused had failed to rebut the presumption and hence the judgement and order of acquittal is bad in law and the leave to appeal must be granted. 6. Learned APP Mr. Bhargav Pandya for the respondent – State and learned advocate Mr. Nisarg Shah for the Respondent No. 2. have submitted that the learned Trial Court has appreciated all the evidence in detail in light of the citations referred to in the judgement and has passed the judgement and order of acquittal which is proper and no interference is required and hence the application for leave to appeal must be rejected. 7. With regard to the facts in the present case, it would be fit to refer to the observations made the Apex Court in Rangappa vs. Sri Mohan, 2010 11 SCC 441 in para 14 which reproduced as under: “14. 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 (supra) 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. 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. 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 accused/defendant cannot be expected to discharge an unduly high standard of proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under Section 139, the standard of proof for doing so is that of ‘preponderance of probabilities. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own.” 7.1 The Apex Court in the case of Basalingappa vs. Mudibasappa, 2019 0 AIR(SC) 1983 has observed in Para 23 and 28 as under: “23. We having noticed the ratio laid down by this Court in above cases on Sections 118(a) and 139, we now summaries the principles enumerated by this Court in following manner: (i) Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability. (ii) 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 preponderance of probabilities. (iii) 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. (iv) 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. (v) It is not necessary for the Accused to come in the witness box to support his defence. 24. xxxx 25. xxxx 26. xxxx 27. xxxx 28. We are of the view that when evidence was led before the Court to indicate that apart from loan of Rs. 6 lakhs given to the Accused, within 02 years, amount of Rs. 18 lakhs have been given out by the complainant and his financial capacity being questioned, it was incumbent on the complainant to have explained his financial capacity. Court cannot insist on a person to lead negative evidence.” 7.2 The Apex Court in the case of Dashrathbhai Trikambhai Patel vs. Hitesh Mahendrabhai Patel & Anr., 2023 1 SCC 578 has observed as under:- “30. Court cannot insist on a person to lead negative evidence.” 7.2 The Apex Court in the case of Dashrathbhai Trikambhai Patel vs. Hitesh Mahendrabhai Patel & Anr., 2023 1 SCC 578 has observed as under:- “30. In view of the discussion above, we summaries our findings below: (i) For the commission of an offence under Section 138, the cheque that is dishonoured must represent a legally enforceable debt on the date of maturity or presentation; (ii) If the drawer of the cheque pays a part or whole of the sum between the period when the cheque is drawn and when it is encashed upon maturity, then the legally enforceable debt on the date of maturity would not be the sum represented on the cheque; (iii) When a part or whole of the sum represented on the cheque is paid by the drawer of the cheque, it must be endorsed on the cheque as prescribed in Section 56 of the Act. The cheque endorsed with the payment made may be used to negotiate the balance, if any. If the cheque that is endorsed is dishonoured when it is sought to be encashed upon maturity, then the offence under Section 138 will stand attracted; (iv) The first respondent has made part-payments after the debt was incurred and before the cheque was encashed upon maturity. The sum of rupees twenty lakhs represented on the cheque was not the ‘legally enforceable debt’ on the date of maturity. Thus, the first respondent cannot be deemed to have committed an offence under Section 138 of the Act when the cheque was dishonoured for insufficient funds; (v) The notice demanding the payment of the ‘said amount of money’ has been interpreted by judgments of this Court to mean the cheque amount. The conditions stipulated in the provisos to Section 138 need to be fulfilled in addition to the ingredients in the substantive part of Section 138. Since in this case, the first respondent has not committed an offence under Section 138, the validity of the form of the notice need not be decided.” 8. The conditions stipulated in the provisos to Section 138 need to be fulfilled in addition to the ingredients in the substantive part of Section 138. Since in this case, the first respondent has not committed an offence under Section 138, the validity of the form of the notice need not be decided.” 8. In light of the above settled principles of law and considering the arguments advanced by the learned advocates for the parties and on perusal of the record and proceedings of the case the affidavit of examination in chief of the complainant has been produced at exhibit 4 wherein the complainant has narrated the facts of the complaint on oath. During the cross examination the complainant has stated that he was earlier doing the business of cycle repairing and has started the business of finance in 2006. That he does not maintain a register and he has not submitted any accounts with the Finance Office. That his license was not in existence on the date of his cross examination and the accused is not doing the business of Tours and Travels at the address mentioned in the notice, examination in chief and complaint. That he has not met the accused at the address mentioned in the complaint during the past five years. That he does not remember when he met the accused at his office and he does not know whether the accused has closed his business in the year 2009. That he has not mentioned whether the amount was given by cash or by cheque and the notice was sent to the accused as the owner of Vaibhav Laxmi Enterprise and the accused did not have any agreement with Vaibhav Laxmi Enterprise. That he has not mentioned the date and place where the amount was demanded or given to the accused in his notice, complaint or examination in chief. That he had financial transactions with the husband of the accused and the husband of the accused had filed a police complaint of the theft of the cheque in question and one another cheque also. That he has not shown the amount of Rs.20,00,000/- in his Income Tax Returns for the year 2010 – 2011. 8.1 The accused has sent a reply to the notice and has denied the transaction and the notice is produced at exhibit 20. 9. That he has not shown the amount of Rs.20,00,000/- in his Income Tax Returns for the year 2010 – 2011. 8.1 The accused has sent a reply to the notice and has denied the transaction and the notice is produced at exhibit 20. 9. The learned Trial Court has appreciated all the evidence produced by both the parties and has concluded that the complainant has not proved how the amount was paid to the accused and during the cross examination of the complainant the fact that has emerged is that the huge amount of Rs 20,00,000/- was given in cash in the year 2010 and till the year 2017 the complainant did not demand for the amount even though the amount was taken for a period of three years. The cheque in question has been issued on 12.01.2017 and the learned Trial Court has observed that the complainant has not proved when and how was the amount given to the accused. Moreover as per the say of the complainant he was in the business of finance and had to maintain all the Books of Accounts and had to submit the accounts with the Finance Office but it is pertinent to note that the complainant has categorically stated that he has not maintained any register, has not submitted any accounts with the Finance Office and has not shown the amount of Rs. 20,00,000/- in his Income Tax Returns. Admittedly the notice has been sent by the complainant as owner of Vaibhav Laxmi Enterprise and the complainant has categorically admitted that he did not pay the amount from his personal account and the accused did not have any agreement with Vaibhav Laxmi Enterprise. Moreover the complainant has also admitted that the husband of the accused has filed a police complaint of theft of the cheque in question and another cheque against the complainant and the complainant has not issued any legal notice for the amount of Rs.20,00,000/- or filed any civil suit for recovery of the amount within a period of three years from 19.11.2010. 10. In light of the above as laid down by the Apex Court in Basalingappa (supra) the presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise a probable defence and the standard of proof is preponderance of probability. 10. In light of the above as laid down by the Apex Court in Basalingappa (supra) the presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise a probable defence and the standard of proof is preponderance of probability. The accused has sent a reply to the notice and a police complaint of the theft of the cheque in question has also been filed by the husband of the accused. Moreover as per the judgment of the Apex Court in Dashrathbhai Trikambhai Patel (supra) from the evidence it has emerged on record that there was no legally recoverable debt from the accused and the complainant has admitted that the accused did not have any agreement with Vaibhai Laxmi Enterprise. 11. The learned Trial Court has relied upon the law laid down by the Apex Court in the case of Rangappa (supra) and in light of the same, has concluded that from evidence on record the legally enforceable deb was not proved and the presumption under Section 139 of the N I Act was successfully rebutted by the accused. The complainant had failed to produce reliable and cogent evidence on record about the legally recoverable debt from the accused and has not produced any evidence about when and in whose presence the loan amount was given and applicant has not proved his case beyond reasonable doubt and, in light of the observation of the Apex Court, the learned Trial Court has passed the impugned judgment and order of acquittal, which is just and proper and does not require any interference of this Court. 12. Consequently, the present application seeking leave to present an appeal under Section 378(4) of the Code of Criminal Procedure, 1973 fails and is hereby dismissed. 13. Notice stands discharged. Record and proceedings if any, be sent back to the learned Trial Court forthwith. 14. Since the leave to prefer appeal is rejected, no order is required to be passed in the Criminal Appeal, which is at filing stage and the same stands disposed accordingly.