Appellant – original complainant has filed this appeal under section 378 of the Code of Criminal Procedure, 1973 and challenged the judgment and order of acquittal passed by the learned JMFC, Ankleshwar on 15.4.2009 in Criminal Case No.5947 of 2003 acquitting the respondent accused for the offence under section 138 of the Negotiable Instruments Act, 1881 (for short “the Act”). 2. According to the complainant, she is doing the business and the accused are running business of money lending in partnership in the name of M/s Mohanlal Amratlal Shroff. As the accsued were in need of Rs.4 lacs for their business, the accused demanded Rs.4 lacs on 1.10.2003. On account of relations with the accused, she gave Rs.4 lacs in cash to the accused, who gave cheque No.037629 dated 10.10.2003 for Rs.4 lacs drawn on Ankleshwar Nagrik Sahkari Bank Limited, Goya Bazar branch against the repayment of the amount received by them. The cheque was presented in the bank on 28.10.2003, but it returned unpaid with the endorsement “Insufficient Funds”. Therefore, notice dated 29.10.2003 was sent to the accused, which was received by the accused Nos.2 and 3. The notice was sent to accused No.1 by Registered Post Acknowledgment due and by certificate of posting, but the same returned unserved. The accused did not pay the amount of unpaid cheque. Therefore, complaint under section 138 of the Act was filed.
3. The trial Court issued summons. Pursuant to the summons, the accused appeared and denied having committed the offence. Therefore, the prosecution adduced evidence. At the end of recording of evidence, trial Court explained to the accused the incriminating circumstances appearing in the evidence against them. The accused in their further statement recorded under section 313 of the Code explained that they have not given any cheque towards discharge of debt and certified copy of the account in the Nagrik Sahkari Bank Limited is produced. It is further explained that husband of the complainant took blank cheque from accused No.2 on 1.1.2003 as Rs.4 lacs were to be given to some businessmen and thereafter, informed them that the cheque is not encashed as they are not in need of money, and assured to return back. The complainant has misused the cheque and false complaint is filed. The accused further stated that they have filed a written statement. However, on perusal of the record, no such written statement was found. After hearing the learned advocates for the parties, the trial Court by impugned judgment acquitted the accused. Being aggrieved by the said decision, the complainant has preferred this appeal.
4. I have heard learned learned advocate Mr. Kapadia for the appellant, learned advocate Mr. Mehta for the respondent accused and learned APP Miss Shah for the State. I have also perused the R & P.
5. Learned advocate Mr. Kapadia submitted that the amount was advanced to the accused as hand loan and accused No.2, as partner of accused No.1, gave cheque for repayment of amount advanced to the accused. He also submitted that there is statutory presumption under section 139 of the Act that the cheque was given towards discharge of debt or liability and the accused is required to rebut the presumption. The complainant also produced documentary evidence in form of Account Books indicating that the amount was received by the accused, but the accused failed to rebut the presumption that the cheque was not given towards discharge of debt or liability. He also submitted that the accused did not lead any evidence to rebut the presumption and statutory notice as required under the Act was received by the accused. Therefore, the trial Court was not justified in acquitting the accused and hence, the impugned judgment is required to be set aside. He relied upon decision of Lillykutty Vs. Lawrence reported in 2003 DCR 610 and in the case of Kumar Exports Vs. Sharma Carpets reported in 2009(2) SCC 513.
6. Learned advocate Mr. Mehta submitted that the complainant failed to prove legal debt and the cross examination of the complainant indicates that no reliable evidence was produced in support of the case of legal debt. He also submitted that the Account Books produced by the complainant were being written under the instructions of husband of the complainant, but the husband is not examined. Therefore, the trial Court was justified in not relying upon the Account Books in support of legal debt. He has also submitted that notice as required under section 138(b) was not served to the accused and no evidence was produced with regard to involvement of accused No.4 with the offence as partner of accused No.1 firm. Therefore, the trial Court was justified in acquitting the accused and hence, no interference is warranted in the impugned judgment.
7. It appears from the allegations made in the complaint that accused No.1 is alleged to be a partnership firm and accused Nos.2 to 4 are the partners thereof. During pendency of the proceedings, the accused No.3 was deleted vide Exh-23. It is not in dispute that no evidence except oral evidence of the complainant was produced to prove that accused No.4 was its partner. It is also pertinent to note that the complainant in his oral deposition admitted that accused No.2 was managing the affairs of the firm and accused No.4 was not managing the affairs and has not seen her at any time at the accused No.1 firm. This evidence clearly indicates that the complainant could not prove beyond reasonable doubt that accused No.4 Rekhaben Manharlal Modi was partner in accused No.1 firm. Therefore, learned trial Court was justified in acquitting accused No.4 Rekhaben Manharlal Modi for the offence alleged against accused No.1 firm.
8. In order to prove the prosecution case, the complainant has examined herself at Exh-40. In the cross examination, the complainant admitted that she was taking cheques in the name of other persons from the accused firm. She also admitted that her shop maintains Books of Account as per custom and she keeps daily ledger, account ledger, bill book, chalan book and voucher file. She also admitted that amount recoverable is being reflected in the account ledger and the amount details is also being reflected in the account ledger. She also deposed that the capital account is being shown in the account ledger, but she is not prepared to produce capital account for the year ending on 2003-04. She also admitted that she cannot say as to what was the capital with her on 31.3.2004. She also admitted that the accounts of her business are not being maintained under her instructions. The complainant also admitted that accused No.2 Shaileshbhai Modi did not sign cheque Exh-34 in her presence. She also deposed that she runs business in name of Gitaben Rajeshbhai Chanavala and the transactions of the firm are being carried out by her husband. She also admitted that before 1.10.2003, no amount was advanced to the accused firm. She also admitted that no writing was obtained from the accused in respect of the amount advanced to the accused. She also admitted that the transaction of the cheque was done in the name of her firm.
9. The prosecution examined witness Mahendra Jaikishandas Modi Exh-73. The witness was the Accountant writing the accounts of the business of complainant. The witness deposed that he writes the account on the instructions of husband of the complainant and does not regularly write the account. The witness also deposed that entry in respect of Rs.4 lacs given to the accused on 1.10.2003 is posted at page No.63 in the daily ledger Exh-77. The witness also deposed that the accounts Exh-77 are in respect of firm running in name of Gitaben Rajeshbhai Chanavala. The witness also admitted that account ledger is being prepared on the basis of daily ledger and that he was not maintaining daily ledger regularly, but daily ledger was being prepared by Rajeshbhai (husband of the complainant). The witness also admitted that Rajeshbhai used to maintain daily ledger regularly and on the basis of the same, he has made entries in the computer. The witness also admitted that there was no computer in the firm of Gitaben Rajeshbhai Chanavala. The witness also admitted that he has no personal knowledge that whether the daily ledger maintained by Rajeshbhai was right or wrong. The witness also admitted that under the Income Tax Act, any amount above Rs.20,000/- is to be paid by cheque. The witness also admitted that at the end of year in Exh-77, no balance sheet was prepared and that husband of the complainant used to maintain account ledger and on the basis of said account ledger, he used to make entry in the computer. The witness also admitted that daily ledger and account ledger were being maintained by husband of the complainant.
10. The complainant produced accounts at Exh-77. It is not in dispute that no writing was obtained by the complainant with regard to the amount allegedly advanced to the accused. The oral evidence of the complainant and the prosecution witness Mahendrabhai indicate that the complainant was running business in the name of Gitaben Rajeshbhai Chanavala. It is not the prosecution case that the complainant withdrew the amount from her firm to give it to the accused. Even, the complainant did not produce the books of account to show that she had such amount of cash on hand. Though the complainant was running the business, the accounts of the firm were being prepared under the instructions of Rajeshbhai – husband of the complainant and the complainant was never looking after the accounts and her husband was looking after the business and was giving instructions for the accounts. The evidence also indicates that witness Mahendrabhai, on the basis of accounts maintained by husband of the complainant, made entry in the computer and prepared document Exh-77. It also emerges from the evidence of witness Mahendrabhai that the accounts were not being maintained regularly. The prosecution did not examine husband of the complainant to prove the accounts. Therefore, it cannot be said that the prosecution proved by Exh-77 that the amount was advanced to the accused.
11. It is settled proposition that when an accused has to rebut the presumption under section 139 of the Act, 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 doubt about the existence of a legally recoverable debt or liability, the prosecution can fail. It is not necessary that in order to rebut the presumption, accused is required to step into witness box or lead evidence. The accused can rely upon on the materials submitted by the complainant in order to raise such defence. It is settled proposition that presumption raised in favour of holder of a cheque does not extend to the extent that the cheque was issued for discharge of any debt or liability, which is required to be proved by the complainant. If the accused is able to rebut the presumption and able to raise a probable defence that there was no existence of legally recoverable debt or liability and the cheque was not given towards discharge of such cheque or liability, the burden shifts on the complainant to prove that cheque was given towards discharge of legally recoverable debt or liability. In the present case, as observed earlier, except bare words, there is no convincing and cogent evidence to indicate that the amount of Rs.4 lacs in cash was advanced to the accused. The complainant in her cross examination, admitted that she used to take cheques from the accused in the name of other persons. Therefore, a possibility of misuse of cheque cannot be ruled out. The cross examination of prosecution witnesses raises serious doubts about the fact of advance of the amount to the accused. The accused was able to raise a probable defence that there was no existence of legally recoverable debt. The complainant failed to discharge the burden shifted on him. Therefore, the trial Court was justified in acquitting the accused.
12. As regards service of notice, it appears that the accused gave reply to the notice at Exh-37, wherein the accused have clearly admitted that they have received the notice. It is true that the acknowledgment due does not bear signature of accused No.2. Under section 138(b), notice in writing of unpaid cheque is required to be given to the drawer of the cheque. The object behind this provision is to CR.A/1187/2009 10/10 JUDGMENT give an opportunity to the drawer of the cheque to make payment of unpaid cheque. In the present case, the acknowledgment due does not indicate that the notice was served to the accused Nos.1 and 2, but as reply to the notice Exh-37 clearly indicates that notice was served to the accused. Therefore, notice as required under section 138(b) of the Act was served to the accused. Therefore, the submission that the notice was not served to the accused cannot be accepted.
13. In the decision of Lillykutty (supra), Karnataka High Court has ruled with regard to presumption under section 118 of the Act. In the decision of Kumar Exports (supra), the Hon'ble Supreme Court has ruled about presumption under sections 138 and 139 of the Act. In the facts of this case, both the decisions do not lend any support to the prosecution case.
14. In the result, the appeal fails and stands dismissed.
shekhar* (BANKIM N.MEHTA, J.)