2021 (4) TMI 1388 - HC - Indian Laws

Dishonoured cheque conviction restored after appellate acquittal overturned under Section 138 presumption unrebutted

The HC allowed the appeal and set aside the acquittal order passed by the Appellate Court. The case involved dishonour of cheque under Section 138 of the ... Dishonour of Cheque - judgement of acquittal - rebuttal of presumption under Section 139 of the N.I.Act - Whether the impugned judgment of acquittal passed by the Appellant Court calls for any interference and needs to be set aside by restoring the Judgment of conviction and order of sentence passed by the Trial Court? - HELD THAT:- The Trial Court after taking into consideration the materials on record convicted the accused for the offence punishable under Section 138 of the N.I. Act. But however, the Appellate Court acquitted the accused on the sole ground that the complainant ought to have been filed in the name of ‘Uma Shankar Auto Fuels, Sirsi’ represented by its Proprietor or any other responsible person and since that is not done, there is inherent defect in the complaint which is not noticed by the Trial Court and hence, the impugned Judgment of conviction suffers from legal lacuna. The Appellate Court committed an error in assuming that the proprietary concern- ‘Uma Shankar Auto Fuels’, is not a proprietary concern represented by its proprietor or any other responsible person. It has committed an error in observing that there is defect in the complaint and the impugned judgment passed by the Trial Court suffers from legal lacuna. Absolutely there is no reason or basis for the Appellate Court to form such an opinion. I do not find any support to uphold the said findings. The accused who admitted the cheque-Ex.P1 and his signature found therein is duty bound to rebut the presumption under Section 138 of the N.I.Act. Even though the accused examined himself as DW1 and got marked Exs.D1 to D3 in support of his contentions, the same are not helpful to rebut legal presumption. The tenor of cross examination to PW1 is entirely different from the contention taken by the accused while examining himself as DW1. Accused who admitted his signature found on Ex.P1, is not successful in rebutting the presumption and therefore, he is liable to be convicted. There are no illegality or perversity in the said findings. The findings given by the Appellate Court is not sustainable - appeal allowed. Issues Involved:1. Whether the complaint was properly filed by the proprietor of the concern.2. Whether the accused committed an offence under Section 138 of the Negotiable Instruments Act.3. Whether the appellate court's judgment of acquittal was justified.Detailed Analysis:Issue 1: Proper Filing of Complaint by ProprietorThe appellate court had set aside the trial court's conviction on the grounds that the complaint should have been filed in the name of the proprietary concern, 'Uma Shankar Auto Fuels,' represented by its proprietor. The appellate court viewed this as an inherent defect. However, the High Court referenced the Supreme Court decision in Shankar Finance and Investments v. State of Andhra Pradesh, which clarified that a proprietary concern is not distinct from its proprietor. Therefore, a complaint can be lodged in the name of the proprietary concern itself. The High Court found no defect in the complaint as the complainant had clearly stated he was the proprietor of 'Uma Shankar Auto Fuels.'Issue 2: Commission of Offence under Section 138 of the N.I. ActThe trial court had convicted the accused for issuing a cheque that was dishonored due to insufficient funds. The complainant had presented evidence, including the dishonored cheque, the bank memo, and the unclaimed legal notice, to support his claim. The accused admitted his signature on the cheque but contended it was a withdrawal slip and not a cheque. The High Court found this argument unconvincing, as the cheque was dishonored due to insufficient funds, not because it was a withdrawal slip. The accused's contradictory statements and failure to rebut the presumption under Sections 118 and 139 of the N.I. Act led the High Court to conclude that the accused did commit the offence under Section 138.Issue 3: Justification of the Appellate Court's Judgment of AcquittalThe appellate court had acquitted the accused, primarily on the ground of improper representation of the proprietary concern in the complaint. The High Court found this reasoning flawed, as the complainant had established his authority as the proprietor. The appellate court's decision was deemed unsustainable as it failed to consider the legal presumption under Section 139 of the N.I. Act, which the accused did not successfully rebut. The High Court restored the trial court's conviction, finding the trial court's judgment to be free of illegality or perversity.Conclusion:The High Court allowed the appeal, setting aside the appellate court's judgment of acquittal and restoring the trial court's judgment of conviction and sentence. The accused was found guilty of the offence under Section 138 of the N.I. Act, and the complaint was deemed properly filed by the proprietor of the concern.