HC Karnataka (09.10.2023) in Smt. Pavithra W/O Late Somashekar Vs. Smt. Sheela V W/O Chikkanna [CRL.A No. 439 of 2018, C/W CRL.A.NO.511 of 2018] laid down the methods for rebuttal under section 139 of NIA.
When the presumption has protected the holder of the cheque in terms of Section 139 of the NI Act, the burden lies on the accused to rebut the presumption. The following methods can be adopted by the accused to rebut the presumption namely:
a) By issuing a reply to the notice issued by the complainant,
b) By way of conducting cross-examination,
c) By way of leading evidence and producing the documents.
Excerpts of the Order;
1. These two appeals have been arising out of two different case numbers, however between the same parties.mTherefore, taken up together for consideration.
2. Criminal Appeal No.243/2017 pertains to the amount of Rs.5.00 lakhs. Crl.A No.242/2017 pertains tomRs.3.00 lakhs. These two appeals correspond to the numbers Crl.A No.439/2018 and Crl.A No.511/2018 respectively.m
3. The rank of the parties will be considered henceforth as per their rankings before the Trial Court.mBrief facts of the case:
4. It is the case of the complainant that the accused is her aunt and her aunt stated to have borrowed Rs.8.00 lakhs on a split basis. It is stated in the complaint that, initially, the complainant had lent Rs.5.00 lakhs and secondly, she had lentmRs.3.00 lakhs for the domestic needs and necessities of the accused. It was promised that the amount would be repaid within two months, however, the accused did not repay the amount, instead of repaying the same, the accused had issued two cheques bearing Nos.704440 dated 30.05.2014 for Rs.5.00 lakhs and cheque bearing No.360765 dated 16.06.2014 formRs.3.00 lakhs. When those cheques were presented for encashment, the same were returned with a shara asm insufficient funds’, statutory notice was issued on 01.07.2014 pertaining to the cheque No.360765 and statutory notice dated 21.06.2014 was issued pertaining to cheque No.704440. In spite of notices having been received, the accused has not repaid the amount, therefore, separate complaints have been lodged before the jurisdictional Magistrate. The Trial Court convicted the accused in both cases. However, in the appeals filed by the accused, the Appellate Court set aside the conviction passed by the Trial Court.
5. Heard Sri.Nithin Gowda K.C, learned counsel appearing on behalf of Sri.P.Prasanna Kumar, learned counsel for the appellant and Sri.Rohith Gowda, learned counsel for the
respondent in both cases.
6. It is the submission of learned counsel for the appellant/complainant that, the judgment and order of acquittal passed by the Appellate Court is contrary to the facts and evidence on record, hence, the same is liable to be set aside.
7. It is further contended that the Appellate Court failed to take note of the findings of the Trial Court in respect of the transactions. The legal notice which is marked as Ex.P3 in both cases clearly indicate the date of the loan and also the date on which the said loans have been lent. Even in the evidence of PW.1, PW.1 proved not only the financial capacity to lend the amount but also proved the two different occasions which the accused had borrowed loan.
8. It is further submitted that the Trial Court rightly appreciated the evidence and raised the presumption, however, the Appellate Court failed to take note of the presumption which is available under Section 139 of N.I. Act and ask the complainant to prove the case. The said finding is contrary to the provisions of the Act and also the dictum of the Hon’ble Supreme Court. In the present case, the respondent has not rebutted the presumption by leading cogent evidence. Therefore, the findings of the Appellate Court in recording the acquittal have to be set aside. Making such submissions, learned counsel for the appellant prays to allow the appeals.
9. The learned counsel for the appellant to substantiate his contentions, relied on the following judgments:
1. Bir Singh v. Mukesh Kumar [(2019) 4 SCC 197]
2. Kishan Rao v. Shankargouda [(2018) 8 SCC 165]
3. Rohitbhai Jivanlal Patel v. State of Gujarat & Anr. [(2019) 18 SCC 106]
4. Tedhi Singh v. Narayan Dass Mahant [(2022) 6 SCC 735]
5. TP Murugan through LRs v. Bojan [ (2018) 8 SCC 469]
6. Basalingappa v. Mudibasappa [(2019) 5 SCC 418]
10. Per contra, the learned counsel for the respondent / accused justified the findings of the Appellate Court in acquitting the respondent and submitted that the accused denied the financial transactions and contended that the cheques were issued as a security for the chit transaction which was being run by the complainant.
11. It is further contended that the complainant was threatening the accused and her husband that she would get him suspended from the Government service. The accused stated to have lodged a complaint to the Deputy Commissioner of Mysuru and Commissioner of Police seeking protection for illegal harassment.
12. It is further contended that even assuming that the complainant had two cheques, the manner and method in which the cheques were handed over has been explained in the complaint of the accused lodged before various authorities. Once the burden of proving shifts to the complainant to prove that she had sufficient amount and lent the amount as a loan to the accused, the complainant has to discharge the burden.
13. In the present case, PW.1 contended that she had money with her, generated from various sources namely the death benefit of her husband, accident claims etc., but no relevant documents have been produced to substantiate the loan transaction. Mere contending that she had lent the amount to the accused is not sufficient unless she produces therelevant documents. The Appellate Court rightly considered the said aspect and recorded the acquittal which requires no interference. Making such submissions, the learned counsel for the respondent prays to dismiss the appeals.
14. Having heard the rival contentions of the learned counsel for the respective parties and also perused the findings of the Appellate Court, the points which would arise for my consideration are :
i) Whether the findings of the Appellate Court in recording the acquittal of the respondent for the offence under Section 138 of the N.I Act are sustainable?
ii) Whether the appellant herein made out grounds to interfere with the findings of acquittal passed by the Appellate Court?
15. Before adverting to the facts of the case, now, it is relevant to refer to the judgment of the Hon’ble Supreme Court in the case of Basalingappa v. Mudibasappa [ (2019) 5 SCC 418] paragraph Nos.31 and 25 read thus:
31. This Court had occasion to consider the expression “perverse” in Gamini Bala Koteswara Rao and others Vs. State of Andhra Pradesh through Secretary, (2009) 10 SCC 636, this Court held that although High Court can reappraise the evidence and conclusions drawn by the trial court but judgment of acquittal can be interfered with only judgment is against the weight of evidence. In Paragraph No.14 following has been held:-
“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.”
“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 following manner:
25.1. 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.
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 a for rebutting the presumption is that of 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. 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 in the witness box to support his defence.”
On careful reading of the dictum of the Hon’ble Supreme Court, it makes it clear that the Appellate Court can interfere in an appeal against the acquittal only in rare and exceptional circumstances. It is also a settled principle of law that the Appellate Court can reappraise the evidence and law where it appears that the judgment of the Trial Court is stated to be perverse.
16. When the presumption has protected the holder of the cheque in terms of Section 139 of the NI Act, the burden lies on the accused to rebut the presumption. The following methods can be adopted by the accused to rebut the presumption namely:
a) By issuing a reply to the notice issued by the complainant,
b) By way of conducting cross-examination,
c) By way of leading evidence and producing the documents.
17. It is needless to say that mere denial of the ransaction is not sufficient to rebut the presumption. On the contrary, it is also necessary to produce cogent evidence to rebut the presumption.
18. Now it is relevant to refer to the evidence of the accused who examined herself as DW.1. DW.1 issued a reply notice as per Ex.P5. In the said reply notice, she contended that the cheques in dispute were issued as a security for the chit transaction. There was a dispute between the complainant and the accused in respect of the said chit transaction. It is stated in the evidence that the complainant threatened both the accused and her husband to bear consequences and filled the cheques which were given as security and presented them for encashment.
19. It is noticed in the evidence of DW.1 that she lodged a complaint before various authorities namely the Deputy Commissioner and the District Magistrate at Mysuru on 25.08.2014, 04.08.2014 and 24.07.2014 and received endorsement as per Exs.D1, 2, 3 and 4. It is further noticed in her documentary evidence that the complainant had given her statement on 04.08.2014 before the Police Inspector, Vijayanagara, Mysuru. The jurisdictional police have instructed both parties to maintain harmony and issued an endorsement that the contents of the complaint are civil in nature and they have been abstained to deal with that.
20. It appears from the evidence of DW.1 that the presumption raises under Section 139 of N.I. Act has been rebutted and the burden lies on the complainant to prove that she had lent the amount to the accused. In the cross examination of PW.1, it appears that she had issued a loan on two different occasions. She further admitted that the amount of Rs.3.00 lakhs was lent at the first instance and thereafter, Rs.5.00 lakhs was paid. However, it is contrary to the stand taken in the legal notice and in the examination-in-chief. This contradiction has been construed as material contradiction and the complainant has failed to prove the loan transaction. When the contention of the complainant fails in respect of the loan transaction, the contention of the accused that the cheques were issued for security through the chit transaction certainly prevails. Therefore, the findings of the Appellate Court in recording the acquittal appear to be appropriate and the appellant herein has not made out a ground to interfere with the findings of the Appellate Court.
21. In the light of the observation made above, the points which arose for my consideration are answered as:
Point No.(i) in the ‘Affirmative’
Point No.(ii) in the ‘Negative’
22. Hence, I proceed to pass the following: ORDER
i) The appeals filed by the appellant stand dismissed.
ii) The order dated 24.01.2018 in Crl.A.No.243/2017 passed by the II Additional Sessions Judge, Mysuru and the order dated 24.01.2018 in Crl.A.No.242/2017 passed by the II Additional Sessions Judge, Mysuru are confirmed.
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