2018 (8) TMI 2064 - HC - Indian Laws

Appeals Dismissed in Cheque Dishonor Case Due to Lack of Loan Evidence

The appeals stemmed from complaints under the Negotiable Instruments Act regarding dishonored cheques issued by the respondent to repay loans. While ... Dishonor of Cheque - discharge of legally enforceable debt or not - rebuttal of presumptions - Section 118 and 139 of the NI Act - Cross-examination of witnesses - preponderance of probabilities - HELD THAT:- The defence has to only show that its stand is probable and that would lead to rebuttal of presumptions. In the present case, the reply notice dated 01.04.2014 issued by the respondent assumes significance, because not only did the respondent deny the claims made by the appellant in her statutory notice, but defence of the respondent was clearly indicated in the reply notice. Despite the respondent calling upon the appellant not to deposit the remaining two cheques, the appellant went ahead to deposit the same. A perusal of the cross-examination of the appellant in the witness box shows that a specific objection was raised on behalf of the respondent in respect of the receipt at Exh. 31 and signature on the same was denied. In the face of such denial by the respondent, it was incumbent upon the appellant to have proved signature of the respondent on the said receipt. No effort was taken by the appellant to do so - it was for the appellant to have taken appropriate steps to prove that the receipt was indeed signed and executed by the respondent. As no such steps were taken, the receipt at Exh. 31 could not have become a basis for the appellant to claim that the respondent had admitted of having taken loan from the appellant. The trial Court in the impugned judgments and orders has taken into consideration the entire oral and documentary evidence on record. It was found that there were transactions between the parties pertaining to immovable property. It was found that the presumptions in the present case were satisfactorily rebutted by the respondent by responding to the statutory notice and also effectively cross-examining the appellant. It is settled law that an accused in such cases can rebut the presumption not only by placing on record positive evidence and examining witnesses, but also by discrediting the complainant by effective cross-examination - In the present case, the admissions given by the appellant in cross-examination read with the documents produced by the appellant herself, show that the entire story put forth on behalf of the appellant was not proved beyond reasonable doubt and that the respondent had successfully proved his defence on the touchstone of preponderance of probabilities. It is trite in criminal jurisprudence that the one that accrues in favour of the accused is to be adopted - Appeal dismissed. Issues:Appeals arising from dishonored cheques, presumption under Section 118 and 139 of the Negotiable Instruments Act, 1881, proof of loan advanced to the respondent, rebuttal of presumption by the respondent, examination of oral and documentary evidence, significance of statutory notice and reply notice, reliance on receipt as evidence, cross-examination of witnesses, sufficiency of evidence to prove legal debt, defense on the touchstone of preponderance of probabilities, consideration of entire evidence by the trial Court.Analysis:The appeals arose from three judgments concerning dishonored cheques issued by the respondent, leading to complaints filed under Section 138 of the Negotiable Instruments Act, 1881. The appellant claimed to have advanced loans totaling &8377; 2,00,000 to the respondent, who issued three cheques for repayment. The trial Court found that while presumptions under Section 118 and 139 favored the appellant, the respondent successfully raised a probable defense, leading to the dismissal of complaints and the respondent's acquittal.The appellant contended that the trial Court erred in rebutting the presumption, arguing that the respondent did not deny his signatures on the cheques, and sufficient evidence supported the loan transactions. Conversely, the respondent's counsel highlighted discrepancies in the appellant's evidence, emphasizing the lack of proof for the alleged loans and questioning the authenticity of documents presented.The Court examined the oral and documentary evidence, including pass-book entries and witness statements. It noted inconsistencies in the appellant's claims regarding loan amounts and transactions, highlighting gaps in evidence supporting the loan advanced. The respondent's defense, particularly the reply notice disputing the appellant's claims, was deemed significant in rebutting the presumptions under the Act.The Court emphasized the need for the appellant to prove foundational facts of the loan advanced, especially in light of discrepancies in evidence and the respondent's denial of the receipt's authenticity. The trial Court's decision to consider the entire evidence, including cross-examination and documentary proof, led to the conclusion that the appellant's case was not proven beyond reasonable doubt, affirming the respondent's successful defense based on preponderance of probabilities.Ultimately, the Court found the trial Court's decision to be a possible view, adhering to the principle favoring the accused when two views are possible in criminal cases. As a result, the appeals were dismissed, confirming the trial Court's judgments and orders.