2009 (9) TMI 1069 - HC - Indian Laws

Court dismisses petitions, upholds complaint under Section 138 of Negotiable Instruments Act. Burden of proof on fraud emphasized.

Chanchal Choudhary Versus The State of Maharashtra, Sanjesh Dhall Mumbai, The Honorary Secretary, M/s. Akurli Satya Co-op. Hsg. Society Ltd., Kandivli (E), Mumbai

The Court dismissed the petitions and discharged the Rule, upholding the complaint filed under Section 138 of the Negotiable Instruments Act, 1881. It ... - Issues involved: The issues involved in this judgment include the quashing of a complaint filed under Section 138 of the Negotiable Instruments Act, 1881, based on allegations of fraud and neglecting to pay a due amount, along with the consideration of legal principles and precedents related to fraud in judicial proceedings.Issue 1: Adjournment and Trial Delay The Writ Petitions were filed in 2006, and due to interim relief granted, the trial had not commenced for three years. Despite adjournments sought by the petitioner, the stay was vacated, and the Metropolitan Magistrate was directed to expedite the trial.Issue 2: Complaint and Allegations The complaint, filed in 2005, alleged that the accused failed to pay an amount of Rs.50,000, leading to a bounced cheque. The petitioner claimed that the prosecution was launched with an ulterior motive and out of vendetta, emphasizing that the cheques were issued but disputed the circumstances.Issue 3: Legal Defenses and Presumptions The petitioner argued that the cheque was obtained by fraud and presented documents to support this claim. However, Section 139 of the Act presumes that a cheque is issued for the discharge of a debt unless proven otherwise. The burden of proof lies with the issuer of the cheque, and in this case, the Court found it challenging to conclude that the onus was discharged.Issue 4: Precedents and Fraud Allegations The petitioner cited various judgments related to fraud in judicial proceedings to support the claim that the complaint should be quashed due to alleged fraud. However, the Court noted that proving fraud is a question of fact and must be established before legal consequences can follow. The Court found it difficult to determine if fraud was proven in this case, especially considering the mandate of Section 139 of the Act.Issue 5: Quashing of Complaint Referring to legal principles outlined in State of Haryana v. Bhajan Lal, the Court analyzed the allegations in the complaint and concluded that a prima facie case existed, leading to the dismissal of the petitions and discharge of the Rule.This judgment addresses the delay in trial proceedings, the allegations of neglecting payment leading to a bounced cheque, legal defenses regarding fraud, the burden of proof under Section 139 of the Act, the application of legal precedents related to fraud in judicial proceedings, and the criteria for quashing a complaint based on the principles outlined in State of Haryana v. Bhajan Lal.