2015 (2) TMI 1351 - HC - Indian Laws

Accused's Revision Application Dismissed, Must Surrender to Serve Sentence under Section 138

Bipin Mathurdas Thakkar Versus Samir and Ors.

The accused's revision application was dismissed, affirming the lower courts' judgments. The accused was directed to surrender before the Judicial ... Dishonor of Cheque - legally enforceable debt - rebuttal of presumption or not - defence of the accused is that the demand promissory note and cheque were forcibly taken - Section 138 of Negotiable Instruments Act - HELD THAT:- In the cases of MS NARAYANA MENON @ MANI VERSUS STATE OF KERALA & ANR. [2006 (7) TMI 576 - SUPREME COURT], the Apex Court has explained as to how the presumptions under the Evidence Act as also under the N.I. Act could be rebutted and the concept of standard of proof, in cases under Section 138 of the N.I. Act. There can be no dispute about the propositions laid down in the above cases and the is duly considered. There are no perversity or jurisdictional error has been shown with regard to the impugned judgment and order - Revision Application is dismissed. Issues Involved:1. Legally enforceable debt under Section 138 of the Negotiable Instruments Act.2. Presumption under Section 139 of the N.I. Act.3. Compliance with the requirement of sending a legal notice.4. Rebuttal of presumption by the accused.5. Admissibility of unaccounted cash transactions under Section 138 of the N.I. Act.6. Capacity of the complainant to advance the loan.7. Jurisdictional error or perversity in the impugned judgment.Issue-Wise Detailed Analysis:1. Legally enforceable debt under Section 138 of the Negotiable Instruments Act:The complainant filed a complaint under Section 138 of the N.I. Act, alleging that the accused owed Rs. 25,00,000, which was to be repaid via a cheque. The cheque was dishonored due to insufficient funds. The Judicial Magistrate, First Class (J.M.F.C.) and the Additional Sessions Judge found that the complainant proved beyond reasonable doubt that the accused issued the cheque towards a legally enforceable debt.2. Presumption under Section 139 of the N.I. Act:The court noted that there is an initial presumption in favor of the complainant under Section 139 of the N.I. Act. This presumption is rebuttable, and the accused can contest the existence of a legally enforceable debt. The accused admitted to signing the cheque and the demand promissory note, which supported the presumption.3. Compliance with the requirement of sending a legal notice:The complainant issued a legal notice demanding the cheque amount within 15 days. The notice was returned as 'unclaimed.' The court held that the complainant complied with the requirement of sending the notice, as the envelope was correctly addressed and dispatched. The accused's failure to claim the notice led to an adverse inference against him.4. Rebuttal of presumption by the accused:The accused claimed that he had already repaid the amount in question and that the promissory note and cheque were forcibly taken. However, the court found no credible evidence to support this claim. The accused did not lodge any police complaint or provide testimony from the notary public to substantiate his allegations. The court concluded that the accused failed to rebut the presumption under Section 139 of the N.I. Act.5. Admissibility of unaccounted cash transactions under Section 138 of the N.I. Act:The accused argued that the amount was unaccounted cash, and thus, Section 138 of the N.I. Act should not apply. The court referred to the judgment in 'Rangappa vs. Sri Mohan,' which impliedly overruled the earlier judgment in 'Krishna Janardhan Bhat' regarding unaccounted cash. The court held that non-disclosure of the amount in income tax returns does not automatically negate the applicability of Section 138.6. Capacity of the complainant to advance the loan:The accused questioned the complainant's capacity to advance Rs. 25,00,000. The court noted that the complainant had previously paid Rs. 15,00,000 to the accused, indicating his capacity to advance large sums. The presence of the demand promissory note further supported the complainant's claim.7. Jurisdictional error or perversity in the impugned judgment:The court found no perversity or jurisdictional error in the judgments of the J.M.F.C. and the Additional Sessions Judge. The judgments were in accordance with the law, and the accused failed to provide sufficient grounds for interference.Conclusion:The revision application was dismissed, and the accused was ordered to surrender before the J.M.F.C. to undergo the sentence imposed. The court upheld the judgments of the lower courts, confirming the conviction and sentence under Section 138 of the N.I. Act.