Appellant – original complainant has preferred this appeal under section 378 of the Code of Criminal Procedure, 1973 and challenged the judgment and order of acquittal passed by the learned Metropolitan Magistrate, Negotiable Instruments Act, Court No.6, Ahmedabad on 15.12.2010 in Criminal Case No.2439 of 2008 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, as the father of the accused was his friend, he had acquaintance with the accused. The accused was running business of producing Gujarati film in the name of “Nishant Creative Arts” and was proprietor of the said firm. On account of acquaintance, the accused, before 2-3 months from the date of statutory notice, demanded hand loan for producing Gujarati film. Therefore, Rs.20 lacs were advanced to the accused as hand loan. The accused gave cheque No.363417 dated 25.11.2008 for Rs.20 lacs drawn on Union Bank of India, Naroda branch, Ahmedabad. On presenting the cheque in the bank, it returned unpaid on account of insufficient funds with the endorsement “Today's opening balance is insufficient”. Therefore, notice through advocate was served to the accused as required under section 138(b) of the Act and demand was made for unpaid cheque amount. The accused received the notice, but did not pay the unpaid amount of cheque and gave false and evasive reply. 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 him. The accused explained the incriminating circumstances in his further statement recorded under Section 313 of the Criminal Procedure Code. The accused also filed written statement at Exh-18 explaining the incriminating circumstances. The accused also produced documentary evidence with the written statement. But, the documentary evidence was not admitted in evidence, as it was not proved in accordance with law. The accused examined himself at Exh-19 and his cross examination was recorded at Exh-
21. 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 advocate Mr. Brahmbhatt for the appellant and learned advocate Mr. Panchal for the respondent. I have also perused the impugned judgment and Record & Proceedings of the trial Court.
5. Learned advocate Mr. Brahmbhatt submitted that the acquittal is recorded on the ground that the complainant did not produce any evidence with regard to his income to show that he had financial capacity to give advance of such amount, but under section 139 of the Act, presumption is in favour of holder of a cheque that the cheque was issued towards discharge of debt or liability and accused has to rebut the presumption, but the accused did not lead any evidence to rebut the presumption. He also submitted that according to the accused, the cheque in question was given to one Chandrikaben and the cheque was misused, but mere explanation given for cheque is not sufficient to rebut the presumption, but the accused is required to lead evidence in that regard and as accused did not lead any evidence, the trial Court committed error in acquitting the accused and hence, impugned judgment is required to be set aside. Learned advocate Mr. Brahmbhatt relied upon decisions reported in case of Goa Plast (P) Ltd. v. Chico Ursula D'souza reported in AIR 2004 SC 408, in the case of Hiten P. Dalal Vs. Bratindranath Banerjee reported in JT 2001(5) SC 386, in the case of M/s Dalmia Cement (Bharat) Ltd. Vs. M/s Galaxy Traders and Agencies Ltd. And others reported in 2001 AIR SCW 315, in the case of M/s Kusum Ingots & Alloys Ltd. Vs. M/s Pennar Peterson Securities Ltd. And others reported in JT 2000(2) SC 390, in the case of M/s Prajapati Oil Industry through its owner Rameshbhai Vs. State of Gujarat reported in 2004(1) GLH 365 and 2012(1) Crimes 164 (Bombay).
6. Learned advocate Mr. Panchal submitted that scope in the present appeal is limited, as it is settled proposition that when two views are possible, view favourable to the accused is required to be adopted and hence, when the trial Court has acquitted the accused, this Court would be slow in interfering with the judgment of the trial Court. He further submitted that according to the complainant, there was acquaintance with the accused and hence, large sum was advanced to the accused, but this fact cannot be believed as no one would advance such a huge amount without verifying the credentials of the borrower and without obtaining writing in that regard. He further submitted that the complainant did not mention date of advance, mode of advance, date of handing over cheque to the complainant and hence, the complainant failed to prove that amount was advanced to the accused and cheque in question was given towards discharge of such debt. He further submitted that the complainant failed to prove that he had financial capacity to advance the amount and considering the fact that the complainant was serving in bank, it is highly improbable that he would be in a position to advance amount like Rs.20 lacs and that no evidence with regard to advance to the accused was produced. He further submitted that presumption under section 139 of the Act is rebuttable presumption and the accused is required to raise probable defence by preponderance of probabilities and the accused was able to raise probable defence and hence, the trial Court was justified in recording acquittal and no interference is warranted in the impugned judgment. He relied on the decision of Rangappa Vs. Sri Mohan reported in 2010 (11) SC 441, decision of Kamala S. Vs. Vidhyadharan M.J. And another reported in 2007(5) SCC 264 and decision of M.S. Narayana Menon alias Mani Vs.
State of Kerala and another reported in 2006(6) SCC 39.
7. It appears from the allegations made in the complaint that the accused demanded hand loan for producing Gujarati film before 2-3 months of date of statutory notice and amount of Rs.20 lacs were given to him. It is not in dispute that no writing was obtained by the complainant in respect of such advance and that the amount was not given by cheque. It appears that no exact date of advance made to the accused was stated in the complaint. Therefore, there is nothing to show that the amount was advanced to the accused on a particular date. As observed earlier, according to the complainant, demand was made about 2-
3 months of the statutory notice. On perusal of the statutory notice produced at Exh-12, it appears that the statutory notice was given on 21.12.2008. Therefore, the amount was advanced before about 2-3 months of December, 2008.
8. It is settled proposition that presumption under Section 139 of the Act is rebuttable presumption in favour of the holder of a cheque that the cheque was received for discharge of whole or in part of any debt or other liability. It is also settled proposition that standard of proof to rebut the presumption is that of preponderance of probabilities. In order to rebut the presumption, the accused has to bring on record such facts and circumstances, upon consideration of which the Court may either believe that the consideration did not exist or its non- existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that it did not exist. The accused is required to bring on record something which is probable for getting the benefit of shifting the onus of proving to the complainant. If the accused is able to raise a probable defence which creates doubts about existence of legally recoverable debt, prosecution can fail. In order to raise a probable defence, the accused is not required to enter into witness box or lead evidence but can rely on the evidence produced by the complainant. In light of these settled propositions, the evidence adduced by the parties is required to be examined.
9. In order to prove the case, complainant Prakash Purushottamdas Patel examined himself at Exh-6. The complainant has been extensively cross examined. The complainant admitted in the cross examination that he has been serving as a clerk in the Bank since 1978 and his salary is about Rs.30,000/- to Rs.31,000/- and he pays income tax. The cross examination also indicates that he did not obtain any writing in respect of advance of Rs.20 lacs made to the accused and did not state the date of advance in the complaint. In the cross examination, the complainant deposed that the accused and his son produced film in the year 2002 and denied that he did not make any inquiry about credentials of the accused when he advanced the amount to the accused for producing the film. The complainant also stated that the amount given to the accused is not shown before the income tax authority, as he had borrowed the amount from his friends and admitted that he did not state in the complaint or affidavit as to from whom, he borrowed the money. The complainant also stated that he is unable to produce documentary evidence in that regard and admitted that in his affidavit, he has stated his occupation as business and has not informed his department with regard to advance given to the accused.
10. The complainant served notice Exh-12 to the accused demanding unpaid amount of cheque. The accused gave reply Exh-16 raising defence that Chirag Patel, son of the complainant, the accused and one Manubhai Ramani decided to produce a Gujarati film in the name of “Nishant Creative Arts” and hence, all the partners made investment of equal amount in production of the film and as profit would have been to the said firm to secure payment of share in profit, as share in profit was not decided, the complainant's wife and mother of Chirag Patel Chandrikaben obtained four blank cheques from the accused, as she had made investment for Chirag Patel and blank cheque has been misused.
11. In view of above evidence, it emerges that the accused challenged the fact that the complainant had advanced Rs.20 lacs to him. By cross examination of the complainant, the accused was able to bring on record that there was no documentary evidence to show that the complainant was financially sound to advance such a huge amount and that the amount was received by the accused. The accused was able to bring on record that according to the complainant, the accused allegedly demanded the amount for producing film before 2-3 months of December, but the film was produced much earlier i.e. in the year 2002-2003. Therefore, there was no question of demanding the amount for such purpose. The accused also brought on record that the amount allegedly advanced was not shown in the income tax returns nor the bank where the complainant was serving, was informed about the same. Therefore, the accused was able to raise probable defence by preponderance of probabilities that legally recoverable debt did not exist and thereby was able to rebut the presumption under section 139 of the Act. Hence, burden shifted on the complainant to prove existence of legally recoverable debt. The complainant did not produce cogent evidence to show that the accused demanded the amount for producing film and he advanced the amount. It is also very strange that the complainant advanced such a huge amount without obtaining any writing from the accused. The complainant was serving in the bank as clerk and his income was about Rs.30,000/-. In order to show his financial capacity to advance the amount, the complainant deposed that he borrowed money from his friends and relatives, but the complainant did not examine any of his friends or relatives to show that he borrowed from them. The complainant was income tax payer, but he did not show the amount before the income tax authority. The complainant did not inform his department about advance of such a huge amount. Therefore, it is difficult to believe that the complainant had financial capacity to advance huge amount of Rs.20 lacs to the accused. It is also very pertinent that in the affidavit Exh-6 as well as in the complaint, the complainant has stated his occupation as business, but in the cross examination, he has admitted that he is serving as a clerk in the bank. Therefore, except bare words, there is no cogent and convincing evidence to show that the complainant advanced Rs.20 lacs to the accused. Therefore, the complainant failed to discharge burden shifted on him to prove existence of legally recoverable debt and hence, it is difficult to believe that there was existence of legally recoverable debt and the accused gave cheque in question towards discharge of such debt. According to the accused, the cheque in question was given to one Chandrikaben – sister of the complainant and it was misused. It is true that no evidence in that regard was adduced by the accused, but in view of the settled proposition that in order to raise probable defence, the accused is not required to lead evidence, but can rely upon the evidence produced by the complainant, in my view, the accused was able to raise probable defence by cross examination of the complainant and hence, he was not required to lead any evidence to prove his defence, as the complainant failed to discharge burden shifted on him to prove existence of a legally recoverable debt.
12. It was also submitted by Mr. Brahmbhatt that mere explanation in respect of the cheque is not sufficient and the accused is required to lead evidence to prove that the cheque was misused. In view of the fact that the complainant failed to prove existence of legally recoverable debt, the accused was not required to prove his defence that the cheque was given to Chandrikaben and it was misused. Therefore, this submissions cannot be accepted.
13. The decisions in the case of Hiten P. Dalal Vs.
Bratindranath Banerjee reported in JT 2001(5) SC 386, in the case of M/s Dalmia Cement (Bharat) Ltd. Vs. M/s Galaxy Traders and Agencies Ltd. And others reported in 2001 AIR SCW 315 and 2012(1) Crimes 164 (Bombay) are in respect of presumption under sections 138 and 139 of the Act, wherein the Courts have held that presumption under section 139 is in favour of the holder of a cheque unless contrary is established by the accused. In the present case, as observed earlier, by cross examining the complainant, the accused was able to bring on record such facts and circumstances, which creates doubts about existence of legally recoverable debt. Therefore, the accused was able to rebut the presumption by raising probable defence and burden shifted on the complainant to prove existence of legally recoverable debt, which he failed to discharge. Therefore, all these decisions do not render any assistance to the appellant.
14. So far as decision in the case of M/s Kusum Ingots & Alloys Ltd. Vs. M/s Pennar Peterson Securities Ltd. And others reported in JT 2000 (SC) 390 relied upon by learned advocate Mr. Brahmbhatt, it is in respect of offence against the company and its directors and section 22 of Sick Industrial Companies (Special Provision) Act, 1985. In the facts of this case, this decision does not apply.
15. Learned advocate Mr. Panchal relied upon the decision of Rangappa Vs. Sri Mohan reported in 2010(11) SCC 441. It is in respect of presumption under section 139 of the Act. In the said decision, the Hon'ble Supreme Court has ruled that the accused has to rebut the presumption and standard of proof for doing so is that of preponderance of probabilities. It is also held that the accused can rely on material submitted by the complainant in order to raise probable defence. Mr. Panchal also relied upon the decision of Kamala S. Vs. Vidhyadharan M.J. And another reported in 2007(5) SCC 264 and decision of M.S. Narayana Menon alias Mani Vs. State of Kerala and another reported in 2006(6) SCC 39 in respect of rebuttable presumption under section 139 of the Act. In these decisions, the Hon'ble Supreme Court ruled that the accused is required to raise probable defence and if it discharges the burden, the onus shifts on the complainant to prove his case. As observed earlier, the accused was able to raise probable defence, but the complainant failed to discharge the burden shifted on him. Therefore, in view of these decisions, the trial Court was justified in acquitting the accused.
16. It may be recorded that one Rajnikant Manilal Patel the brother-in-law, (husband of sister) of the complainant also filed Criminal Case No.2438 of 2008 against the accused for the amount allegedly advanced for producing Gujarati film. In that case also, the trial Court acquitted the accused and Criminal Appeal No.337 of 2011 was preferred in this Court and it was also heard along with this appeal.
17. In view of above, no interference is warranted in the impugned Judgment and hence, the appeal fails and stands dismissed.
shekhar* (BANKIM.N.MEHTA, J.)