The appellant, original complainant, has filed this appeal under Section 378 of the Code of Criminal Procedure, 1973 and challenged the judgement and order of acquittal passed by learned Metropolitan Magistrate (Negotiable Instruments Act), Court No. 4, Ahmedabad, on 10.11.2010, in Criminal Case No. 1065 of 2009 acquitting the respondent- accused for the offence under Section 138 of the Negotiable Instruments Act, 1881 (“the Act” for short). 2. According to the complainant, the accused is doing business in the name of Shreekrishna Dairy and was his friend. The accused, his nephew Bharatbhai and brother-in-law Dineshbhai used to obtain loan from him for their milk business. The accused obtained Rs. 22 lakh between 28.7.2006 and 11.12.2007 and executed an agreement. Thereafter, as the accused and his relatives were in need of more finance, they obtained Rs. 59,59,000/- between 20.12.2007 and 30.12.2007. Thereby, the accused obtained in all Rs. 81,59,000/- between 28.7.2006 and 30.12.2007. The accused executed agreement and promissory note with regard to the amount obtained by him and his relatives. Therefore, Rs. 81,59,000/- remained outstanding from the accused who gave cheque No. 120979 dated 22.10.2008 for Rs. 30,77,000/- drawn on Ahmedabad District Co-operative Bank Limited, Bopal Branch, towards discharge of liability in part. On presenting the cheque in the Bank, it returned unpaid with the enforsement “today's opening balance insufficient”. Therefore, notice was served to the accused demanding the amount of unpaid cheque. The notice was received by the accused but he gave evasive reply and did not pay the amount of unpaid cheque. Therefore, complaint under Section 138 of the Act was filed.
3. The trial Court issued summons and the accused appeared and denied having committed any offence and claimed to be tried. Therefore, the prosecution produced evidence. On completion of recording of evidence, further statement of the accused was recorded under Section 313 of the Code of Criminal Procedure. In his further statement, the accused stated that the complainant obtained blank cheques with his signatures after giving threats and the cheques are misused. It is also explained that there is no legally recoverable debt and false complaint is filed.
4. After hearing learned advocates for the parties, the trial Court by the impugned judgement acquitted the accused. Being aggrieved by the said decision, present appeal has been filed by the complainant.
5. I have heard learned advocates for the parties and learned A.P.P. Ms. C.M. Shah for the respondent State at length and in great detail. I have also perused the record and proceedings of the trial Court.
6. Learned advocate for the appellant submitted that the amount was advanced to the accused who executed receipt Exh. 7 and thereby the amount was received by the accused. He also submitted that the evidence of the complainant indicates that he borrowed amount from his friends and relatives and paid to the accused. Therefore, the complainant was able to prove legal debt. He also submitted that notice as required under law was served to the accused who gave evasive reply and did not pay the unpaid cheque amount. Therefore, the trial Court committed error in acquitting the accused. He also submitted that as the cheque is given by the accused, legal presumption under Section 139 of the Act is required to be rebutted by the accused but he failed to rebut the presumption and therefore the trial Court committed error in acquitting the accused and hence the impugned judgement is required to be set aside.
7. Learned advocate for the respondent accused submitted that the complainant failed to prove legal debt as he did not examine the witnesses from whom he allegedly brought money. He also submitted that except oral version, no documentary evidence was produced to show that huge amount of about Rs. 81 lakh was paid to the accused. He also submitted that the allegations that the amount was paid to the accused and his relatives and therefore, it cannot be said that the amount was paid to the accused and hence there was no legally recoverable debt. The cross-examination of the complainant indicates that the accused was able to rebut the presumption and therefore the trial Court was justified in acquitting the accused and hence no interference is warranted in the impugned judgement.
8. It appears from the allegations made in the complaint that the accused allegedly took Rs. 22 lakh between 20.7.2006 and 11.12.2007 and executed agreement Exh. 6. Thereafter, the accused again obtained Rs. 59,59,000/- between 20.12.2007 and 30.12.2007. Thereby the accused obtained Rs. 81,59,000/- between 20.7.2006 and 30.12.2007 and against such amount cheque in question was allegedly given by the accused. In order to prove his case, the complainant examined himself at Exh. 3. In the cross- examination the complainant has admitted that agreement Exh. 6 was executed on 11.12.2007 and the time period mentioned in the agreement was to expire on 10.12.2009 and also admitted that before expiry of the said period, complaint was filed. The witness also deposed that he gave the amount in division and the amount was given after borrowing from his friends and relatives and does not remember as to what amount was borrowed and from whom. The witness also deposed that the amount is shown in the income-tax statement but income-tax statement is not produced. The witness also admitted that when the accused obtained the amount his economic condition was not good. The witness also admitted that as per the consideration receipt Exh. 7, the accused and other borrowers are liable to pay the amount.
9. The prosecution produced agreement executed by the accused at Exh. 6. It is executed on 11.12.2007 and stipulates that amount of Rs. 22 lakh has been obtained for two years and on expiry of the said period of two years the amount is to be returned. It further stipulates that the accused has given cheques in consideration of the amountd received by him and the cheques are to be used only if the amount borrowed is not returned.
10. The prosecution produced consideration receipt dated 30.12.2007 at Exh. 7. The receipt indicates that in all Rs. 81,59,000/- was received by the accused and his brothers, nephew and brother-in-law Dineshbhai and the cheque in question was given to the complainant.
11. In view of the above evidence, it emerges that the accused earlier obtained Rs. 22 lakh and executed an agreement Exh. 6. The agreement stipuated that amount of Rs. 22 lakh was obtained for a period of two years and cheques were given towards repayment of the amount advanced. Thereafter, the accused obtained Rs. 59,59,000/- and thereby the accused obtained in all Rs. 81,59,000/-. It was alleged that the cheque in question for Rs. 30,77,000/- was given towards part payment of such amount. It is not in dispute that the complainant did not produce any documentary evidence to show that he had the income and sufficient funds to support his case. According to the complainant, he borrowed amount from his friends and relatives but did not examine any of the friends or relatives to prove that he borrowed the amount from them nor produced the evidence that amount was borrowed. The complainant deposed that at the time of transaction his income was about Rs. 8 lakh to Rs. 10 lakh per year and had agricultural income but income-tax return was not produced to support the case of income. It also appears that the complainant was not owner of any agriculture land. Therefore, it is difficult to believe that the complainant had income from agriculture land. Therefore, except bare words, there is no evidence that the complainant had funds to advance. It is also pertinent that the complainant admitted that when the amount was advanced to the accused his financial condition was in bad shape. It is difficult to believe that despite knowing this fact the complainant would advance such amount to the accused. Therefore, the prosecution case that the complainant advanced the amount raises serious doubts.
12. Under Section 139 of the Act, it shall be presumed that holder of a cheque received the cheque for discharge in whole or in part of any debt or other liability, unless contrary is proved. It is settle position that when the accused has to rebut the presumption under Section 139 of the Act, the standard of proof for doing so is that of preponderance of possibilities. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally recoverable debt or liability, the prosecution can fail. It is also settled position that in order to raise probable defence, an accused is not required to enter into the witness box or lead evidence, the accused can rely on the material submitted by the complainant. In order to raise such defence, presumption raised in favour of holder of cheque does not extend to the extent the cheque was issued for the discharge of any debt or liability. It is required to be proved by the complainant. Therefore, if the accused is able to rebut the presumption by raising probable defence, the burden shifts on the complainant to prove that the cheque was given towards discharge of legally recoverable debt or liability. In view of above settled position, the evidence adduced by the prosecution is required to be examined.
13. It is clear from the evidence that no documentary evidence was produced by the prosecution to prove that the complainant had funds to advance huge amount of Rs. 81,59,000/-. The complainant did not produce income-tax statement though the amount was shown in the statement. As regards income from agriculture land, as admitted by the complainant he had no agriculture land of his own. Therefore, it is difficult to believe that the complainant had income from agriculture land. Therefore, in my view, it is difficult to believe that the complainant had sufficient funds to advance as claimed.
14. It also appears from the agreement Exh. 6 that Rs. 22 lakh was obtained by the accused for a period of two years. Therefore, the complainant could have demanded the amount of Rs. 22 lakh only after two years in view of this stipulation. The cheque in question was allegedly given towards part payment of the outstanding amount which included the amount of Rs. 22 lakh. Therefore, the outstanding amount as claimed by the prosecution on the date of cheque in question was not a legally recoverable debt or liability.
15. According to the accused, the cheque was misused. In view of the fact that the accused challenged the receipt of the amount and as no documentary evidence was produced to show that the complainant had the funds to advance, the accused was able to raise probable defence. Therefore, the prosecution case creates doubts about the existence of a legally recoverable debt or liability and it cannot be said that the cheque in question was given towards discharge of liability in part as claimed by the prosecution.
16. In view of above, learned trial Magistrate was justified in acquitting the accused and hence no interference is warranted in the impugned judgement.
17. In the result, the appeal fails and stands dismissed.
(BANKIM N. MEHTA, J) (pkn)