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of <h1>Court sets aside Appellate Judge's decision, finds respondent guilty under Section 138, directs enforcement of punishment.</h1> The Court allowed the appeal, setting aside the Appellate Judge's decision and finding the respondent guilty under Section 138 of the Negotiable ... Dishonor of Cheque - burden to prove that the cheque was issued to discharge legally enforceable debt or not - rebuttal of presumption - Section 139 of Negotiable Instruments Act - HELD THAT:- Admittedly, the purchase made vide Ex.P2 is a credit purchase. It is not the case of the respondent/accused that he had paid the sale price for the goods supplied vide Ex.P2. His only contention is that the goods were not supplied to him and the cheque was issued only by way of security. Ex.X1 would show the tax element for the purchase transaction on the purchase was remitted against the account of the respondent to the Commercial Tax Department, the genuineness of the transaction cannot be disputed. Under such circumstances, it goes without saying that the respondent/accused is liable to pay the sale price. Since it is not unusual to make payments by way of issuing cheques, the impugned cheque is used by the appellant towards realising the invoice amount by putting it for collection. PW1 is none other than the Manager of the Firm to whom the power has been given by the Directors of the Firm to represent the cases. Though PW1 might not be the Manager at the time of the transaction, he would have got appointed subsequently. In the Firms/Companies, the employees would change from time to time, but the institution remains. Just because there is a change in the person who hold the post of Manager, it cannot be stated that the present Manager is not the authorised person to represent the authorised Firm - Neither the appellant-Firm nor PW1 has disputed about the power given to him to represent the Firm. In this background of facts, it cannot be claimed that the respondent/accused had discharged his reverse burden and refuted the initial presumption that has been drawn in favour of the appellant. The learned counsel for the respondent/accused submitted that PW1 himself has admitted that in the month of April 2009, a sum of ₹ 4,80,216/- has been paid by the respondent and hence he has the right to get that sum deducted from his dues. It is to be noted that the respondent/accused never claimed that he had made partial repayment towards the impugned purchase made vide Ex.P2-invoice, but he denied his very liability towards Ex.P2 purchase - In the evidence of PW1 he has stated that he received ₹ 4,80,216/- in the month of April 2009 itself. But the fact that the total amount of ₹ 4,80,216/- has been received on two dates vide 21.04.2009 and 27.06.2009 respectively. It has not shown before the Court as to how the payment of ₹ 3,07,576/- has got only relevance to the purchase made through Ex.P2. The account statement of the complainant would show that the purchase of Ex.P1 is still pending. The respondent/accused is found guilty for the offence punishable under Section 138 of Negotiable Instruments Act. The trial Court is directed to secure the accused to undergo the punishment imposed by the trial Court - Appeal allowed. Issues:Challenge to judgment of the Trial Court under Section 138 of Negotiable Instruments Act.Analysis:1. The appellant filed a complaint against the respondent for dishonor of a cheque issued towards payment for purchased yarns. The Trial Judge found the accused guilty under Section 138 of the Negotiable Instruments Act, sentencing him to imprisonment and a fine. The Appellate Judge reversed this decision, leading to the current appeal.2. The appellant argued that evidence, including the invoice, statement of account, and the respondent's signature on the cheque, supported his case. The respondent contended that the goods were not received, highlighting discrepancies in the purchase amount. The Appellate Judge favored the respondent due to lack of definitive proof of a legally enforceable debt.3. The appellant relied on the initial presumption under Section 139 of the Act, emphasizing the respondent's failure to refute the evidence conclusively. The respondent claimed the cheque was security, not for a debt. The Court noted the appellant's right to fill the cheque for recovering the sale price.4. The Court emphasized that the respondent's contention of issuing blank cheques as security did not absolve him of liability for the purchased goods. The evidence indicated a credit purchase, with the appellant entitled to fill the cheque for recovery. The respondent's argument of misusing the cheque was not substantiated.5. The Court analyzed the evidence, including the invoice, account statements, and tax deductions, to establish the genuineness of the transaction. It rejected the respondent's claim of partial payment towards the purchase, affirming his liability under Section 138 of the Act.6. Ultimately, the Court allowed the appeal, setting aside the Appellate Judge's decision and finding the respondent guilty under Section 138 of the Negotiable Instruments Act. The trial Court was directed to enforce the punishment imposed on the accused.
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