The appellant, original complainant, has preferred this appeal under Section 378 of the Code of Criminal Procedure and challenged the judgement and order of acquittal passed by learned Judicial Magistrate First Class, Veraval, on 13.1.2004 in Criminal Case No. 427 of 1999. 2. According to the complainant, as the respondent- accused was in need of finance for his business, he demanded hand loan and therefore the complainant advanced Rs. 1 lakh to the accused who gave cheque No. 851266 dated 16.2.1999 drawn on State Bank of India, Adri Branch for Rs. 1 lakh. On presenting the cheque in the bank, it returned unpaid with the endorsement “referred to drawer and insufficient fund”. Therefore, notice dated 9.3.1999 was served through advocate to the accused demanding the amount of unpaid cheque. Registered notice came with endorsement “not found” whereas notice served by certificate of posting was served to the accused. However, the accused did not pay the amount. Therefore, complaint under Section 138 of the Negotiable Instruments Act (“the Act” for short) and Section 420 of the Indian Penal Code was filed.
3. The trial Court issued summons to the accused who appeared in the Court and denied having committed offence. Therefore, prosecution adduced evidence. On completion of recording of evidence, further statement of the accused under Section 313 of the Code of Criminal Procedure was recorded. In his further statement, the accused stated that cheque has been misused from lost cheque book by forging his signature. After hearing learned advocates for the parties, the trial Court by impugned judgement acquitted the accused. Therefore, the present appeal has been filed by the complainant.
4. I have heard learned advocate Ms. Meghna A. Patel for learned advocate Mr. Ashish Dagli for the appellant and learned A.P.P. Ms. C.M. Shah for the respondent State at length and in great detail. Respondent accused is served but has not appeared. I have also perused the impugned judgement and record and proceedings of the trial Court.
5. Learned advocate Ms. Patel for the appellant submitted that the cheque in question was given by the accused towards discharge of his liability and under Section 139 of the Act there is a legal presumption that the cheque was given towards discharge of liability and the accused raised a defence that the cheque was misused is not proved. She also submitted that the summons of the complaint was served at the same address and the notice sent under postal certificate has not returned and therefore the notice is deemed to have been served. She further submitted that as the accused failed to rebut the presumption, the trial Court committed error in not believing the evidence of the complainant and therefore the impugned judgement is required to be set aside. She relied on the following decisions:
1. RANGAPPA VS. SRI MOHAN reported in (2010) 11 SCC 441;
2. C.C. ALAVI HAJI VS. PALAPETTY MUHAMMED AND ANOTHER reported in (2007) 6 SCC 555;
3. PRASANNA VS. K. VIJAYALAKSHMI reported in 1993(1) Crimes 679;
4. K. MADHU VS. M/S. OMEGA PIPES LTD. reported in 1994 Cri. L. J. 3439;
5. D. VINOD SHIVAPPA VS. NANDA BELLIAPPA reported (2006) 6 SCC 456;
6. G.N. PATEL VS. STATE reported in 2006(1) G.L.R. 786 6. Learned A.P.P. Ms. Shah supported the judgement and submitted that the accused was able to rebut the presumption and hence the trial Court was justified in acquitting the accused.
8. Under Section 139 of the Act there is a legal presumption that the cheque was issued for discharge of liability and that presumption is rebuttable. It is settled proposition that the accused is not expected to rebut the statutory presumption by proving his defence beyond reasonable doubt. It is enough if the accused is able to establish that circumstances existed which enables a prudent man to suppose that no debt existed. The burden of proof lying on the accused required to be discharged by preponderance of probabilities and not beyond reasonable doubt as required for the prosecution to prove its case. It is also not necessary that accused should step into the witness box or lead evidence to prove his defence but he can rely on the material produced on the record to rebut the presumption. In the present case, the accused has challenged existence of recoverable debt and service of notice under Section 138(b) of the Act. Therefore, the evidence of the complainant is required to be examined in this context.
7. The complainant has examined himself at Exh. 21. According to the witness, on account of friendship he gave Rs. 1 lakh to the accused who gave cheque in question in presence of Rambhai Vala. According to the witness, the accused signed the cheque in his presence. In the cross-examination the witness has deposed that the amount was advanced before about four to five days of the issue of the cheque in question. The witness has also deposed that he was not maintaining books of account. The witness has also deposed that he keeps account of income and expenditure and is being assessed by income-tax. The witness has also deposed that he gave the amount on 16.2.1999 but he has no evidence to show that he had cash on hand on that day. The witness has also deposed that he made note with regard to the amount given to the accused in his diary but did not obtain receipt and has not disclosed in the income-tax assessment that Rs. 1 lac is outstanding. The witness has denied that he had no cash amount of Rs. 1 lakh on 16.2.1999 when he had advanced the amount. The witness has also admitted that cases are pending between Rambhai Vala and the accused. The witness has also deposed that he cannot say as to who wrote name of payee, amount and date in cheque Exh. 22.
8. In view of above evidence, it emerges that the complainant paid the amount in cash to the accused but did not obtain receipt and did not show this amount in his income- tax assessment. The complainant has not produced any documentary evidence to show that he had the cash on hand on 16.2.1999 when he allegedly advanced the amount to the accused. It is significant that the complainant does not indicate the date of advance to the accused and in the cross- examination the witness has deposed that he gave the amount before about four / five days of cheque Exh. 22. It also appears that cheque Exh. 22 bears date of 16.2.1999. Therefore, there is contradiction with regard to the date of advance to the accused. It is also significant that the complainant is an income-tax assessee. However, he does not maintain books of account. The evidence of this witness also indicates that he had made note in the diary about the advance made to the accused. However, the diary is not produced in support of the case.
9. It is also pertinent that the witness has deposed that the accused signed the cheque in his presence but is unable to identify the writing of details on the cheque Exh. 22. The accused in his further statement has raised a defence that lost cheque has been misused. Therefore, considering the evidence of the complainant in light of the defence raised by the accused, in my view the accused was able to rebut the presumption under Section 139 of the Act. The accused was able to raise a probable defence that he did not receive the amount and cross-examination of the complaint creates doubt about existence of legally recoverable debt or liability. The accused was able to bring on record that he did not receive the amount. Therefore, the burden shifted on the complainant to prove that the amount was advanced to the accused. The complainant did not adduce cogent and convincing evidence to prove that he had cash on hand when he advanced and the accused gave cheque towards discharge of his liability. It is also very strange that according to the complainant the details in cheque Exh. 22 were written by Rambhai Vala under the instruction of the accused but the cross-examination reveals that cases are pending between Rambhai Vala and the accused. Therefore, it is difficult to believe that the accused would give instructions to said Rambhai to fill in details in the cheque Exh. 22. At other place in the cross-examination the witness has deposed that he cannot say as to who wrote details in cheque Exh. 22. In view of this evidence, it is difficult to believe that the accused gave cheque Exh. 22 to the complainant. Therefore, in my view, the trial Court was justified in recording that the complainant failed to prove existence of recoverable debt.
10. As regards notice, it appears that the envelope containing notice Exh. 27 has returned with endorsement “NF”. It can be inferred that the endorsement is of “not found”. Notice is also sent by certificate of posting Exh. 26. It is stated by learned advocate for the appellant Ms. Patel that the summons of complaint was served at the same address and therefore it was the correct address of the accused. The accused has denied having received the notice. In the decision of C.C. KALAVI HAJI VS. PALAPETTY MUHAMMED AND ANOTHER reported in (2007) 6 SCC 555 the Hon'ble Supreme Court has held that once notice is sent by registered post by correctly addressing the drawer of the cheque, the service of notice is deemed to have been effected. However, the drawer can rebut the presumption of service of notice by showing that he had no knowledge that the notice was brought to his address or the address mentioned on the cover was incorrect or the letter was never tendered or the report of the postman was incorrect. In the present case the accused has in his further statement except denying the receipt of notice, not stated that the address mentioned in the notice is incorrect. Notice sent by certificate of posting has not returned as claimed by the complainant. The accused has not adduced any evidence to prove that the address mentioned on the envelope containing the notice was incorrect or that the report of the postman was incorrect. On the contrary, it appears from the statement made by learned advocate Ms. Patel that the summons of the complaint was served to the accused at the same address. In my view, the trial Court committed error in recording the finding with regard to receipt of notice by the accused and the complainant served notice as required under Section 138(b) of the Act to the accused.
11. In the decision of D. VINOD SHIVAPPA VS. NANDA BELLIAPPA reported in (2006) 6 SCC 456 Hon'ble Supreme Court has ruled that when the drawer refuses to accept notice or when he evades service of the notice by fraudulent or unscrupulous means so that the envelope containing the notice is returned with a false endorsement such as premises locked or addressee not available, Court may presume receipt of the notice by the drawer. In the present case the endorsement of the postal authority is “NF”. The accused has not rebutted the presumption of service of notice by cogent evidence. Therefore, the finding recorded by the trial Court with regard to service of notice is erroneous.
12. Learned advocate Ms. Patel has also relied on the decision of Madras High Court in the case of PRASANNA VS. VIJAYALAKSHMI reported in 1993(1) Crimes 679 and the decision of Kerala High Court K. MADHU VS. M/S. OMEGA PIPES LTD. reported in 1994 Cri. L.J. 3439 with regard to service of notice. However, in view of the fact that the Hon'ble Supreme Court has laid down law with regard to service of notice, these decisions do not require any elaborate discussion.
13. In view of above, in my view, the trial Court committed error in recording the finding that the notice as required under Section 138(b) of the Act was not served to the accused. However, the trial Court was justified in recording that the complainant failed to prove debt and that the cheque Exh. 22 was issued towards discharge of liability. Therefore, the trial Court was justified in recording acquittal and no interference is warranted in the impugned judgement.
14. In the result, the appeal fails and stands dismissed.
(BANKIM N. MEHTA, J) (pkn)