2021 (9) TMI 559 - HC - Indian Laws

Dismissal of Criminal Petition; Trial Ordered to Resolve Cheque Dispute

The High Court dismissed the Criminal Original Petition, directing a trial to resolve the factual disputes regarding the validity of the cheque, ... Dishonor of Cheque - Calling for the entire records relating to complaint - rebuttal of presumption - ulterior motive to cheat the respondent/complainant or not - Section 482 of Cr.P.C. - HELD THAT:- The issuance of the disputed cheque by the petitioner is admitted and established. Primarily, once the issuance of cheque is admitted/established, the presumption would arise under Section 139 of the N.I. Act in favour of the holder of cheque and the burden lies upon the accused to rebut the presumption by adducing evidence. As held by the Hon'ble Supreme Court in the case of Rajeshbhai Muljibhai Patel [2020 (2) TMI 412 - SUPREME COURT], until the accused discharges his burden, the presumption under Section 139 of N.I. Act will continue to remain and it is for the accused to adduce evidence to rebut the statutory presumption. The Hon'ble Supreme Court has further held that the case therein involves various disputed questions of facts which need to be adjudicated after the parties adduce evidence, and the complaint under Section 138 of the N.I. Act ought not to have been quashed by the High Court by taking recourse to Section 482 Cr.P.C. Though the Court has power to quash the criminal complaint filed under Section 138 of the N.I. Act on the legal issues like limitation, etc., criminal complaint filed under Section 138 of the N.I. Act ought not to have been quashed and further held that, under Section 482 Cr.P.C., it is for the Court to decide there is prima facie case made out by the petitioner to quash the same - Petition dismissed. Issues Involved:1. Validity of the cheque issued by the petitioners.2. Allegations of cheque dishonor due to insufficient funds.3. Whether the cheque was issued for security purposes or towards liability.4. Full and final settlement of dues between the parties.5. Admissibility of evidence to rebut the presumption under Section 139 of the N.I. Act.6. Jurisdiction of the High Court under Section 482 Cr.P.C. to quash the complaint.Detailed Analysis of the Judgment:1. Validity of the Cheque Issued by the Petitioners:The petitioners issued a cheque bearing No. 003983 dated 05.01.2015 for Rs. 6,41,000 to the respondent. The issuance of the cheque is admitted and established. The presumption under Section 139 of the Negotiable Instruments Act (N.I. Act) arises in favor of the holder of the cheque, placing the burden on the accused to rebut this presumption by adducing evidence.2. Allegations of Cheque Dishonor Due to Insufficient Funds:The cheque was first presented for payment on 09.01.2015 and was dishonored on 10.01.2015 due to 'Funds Insufficient.' It was re-deposited on 27.02.2015 and again dishonored on 02.03.2015 with the same remark. The petitioners allegedly apologized and requested the respondent to re-deposit the cheque, knowing it would not be honored.3. Whether the Cheque Was Issued for Security Purposes or Towards Liability:The petitioners contend the cheque was issued as security and not towards any liability. They claim that the respondent and her family members were informed not to present the cheque. The respondent, however, asserts the cheque was issued to clear liabilities and not for security purposes. This factual dispute requires evidence to be adjudicated.4. Full and Final Settlement of Dues Between the Parties:The petitioners argue that the dues were settled through M/s. Jain Properties, which issued cheques to the respondent and her sisters. The respondent denies this, stating there was no full and final settlement and the amount paid by M/s. Jain Properties pertains to a different transaction. This contention involves disputed facts that need to be resolved through evidence.5. Admissibility of Evidence to Rebut the Presumption Under Section 139 of the N.I. Act:The Hon'ble Supreme Court in Rajeshbhai Muljibhai Patel v. State of Gujarat held that once the issuance of a cheque is admitted, the presumption under Section 139 of the N.I. Act arises in favor of the holder. It is the accused's burden to rebut this presumption. The petitioners need to adduce evidence to prove the cheque was issued for security purposes and not towards liability.6. Jurisdiction of the High Court Under Section 482 Cr.P.C. to Quash the Complaint:The High Court noted that it cannot adjudicate disputed questions of fact under Section 482 Cr.P.C. The issues raised by the petitioners involve factual disputes that require evidence and trial. Therefore, the complaint under Section 138 of the N.I. Act cannot be quashed at this stage.Conclusion:The High Court dismissed the Criminal Original Petition, stating that the issues involved are factual and need to be tried before the trial court. The trial is to be completed within eight months from the date of receipt of the order. The petitioners must adduce evidence to rebut the statutory presumption under Section 139 of the N.I. Act, and the trial court will adjudicate the disputed facts accordingly.