2017 (8) TMI 539

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.... 3. The present revision petition is directed against both the concurrent judgments of the Courts below. 4. Respondent No.1, Ravinder Kumar had advanced a loan of Rs. 4 lakhs to the petitioner which was promised to be returned by him with simple interest of 24% before May, 2012. When money was demanded by the respondent No.1, it was refused. Later, in June 2012 the petitioner is said to have issued a cheque dated 23.07.2012 of Rs. 4 lakhs bearing No.282146, drawn on ICICI Bank, C-Block, Janakpuri branch. It was promised by the petitioner that the interest would be paid later. The aforesaid cheque, on presentation in bank, was dishonoured for insufficiency of funds. A notice was sent in writing to the petitioner on 08.08.2012 demanding a sum of Rs. 4 lakhs but no payment was made. Hence, the complaint was lodged against the petitioner. 5. Learned counsel appearing for the petitioner has drawn the attention of this Court to the averments made in the complaint which reflect that even though respondent No.1 was aware of the fact that the petitioner was under heavy debts, but still agreed to pay an amount of Rs. 4 lakhs at the rate of 24% per annum. It was further pointed out that dur....

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.... 4 lakhs on the asking of the petitioner. The respondent No.1/complainant is an Income Tax assessee but such loan amount was not shown in his Income Tax return. There is no written agreement about the loan or any receipt executed by the petitioner. The petitioner admits of signing the cheque but not towards repayment of any debt. It was stated to have been issued only for the purposes of bailing out from difficulty one Jaspreet who was his tenant who owed some money to the respondent No.1/complainant. 14. In order to appreciate the rival contentions of the parties, it is necessary to examine the provisional Sections 118(a), 138 and 139 of the NI Act. Section 118 - Presumptions as to negotiable instruments Until the contrary is proved, the following presumptions shall be made:-- (a) of consideration--that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration;                 *          &....

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....bt or other liability. Section 139- Presumption in favour of holder It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability. 15. For the application of provision of Section 138 of the NI Act, 3 ingredients are required to be satisfied, i.e., I. That there should be a legally enforceable debt; II. That the cheque should have been drawn from the account of the bank for discharge in whole or in part of any debt or other liability which pre-supposes a legally enforceable debt; and III. That the cheques so issued is dishonoured for insufficiency of funds. 16. Under Section 139 of NI Act, unless the contrary is proved, the holder of the cheque shall be presumed to have received the cheque in discharge of any debt or liability. 17. Sub-clause (a) of Section 118 of the NI Act, inter-alia, provides that unless the contrary is proved, the drawn up negotiable instrument, if accepted, has to be presumed to be for consideration. 18. In Goa Plast (P) Ltd. vs. Chico Ursula D'souza & Anr., (2003) 3 SCC 232, the Supreme Court h....

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.... prosecution. The standard of proof for doing so would necessarily be on the basis of "preponderance of probabilities" and not "beyond shadow of any doubt". 22. It is not necessary that every loan transaction is required to be entered into after an agreement. True it is that if an agreement is executed for giving of loan and receipt is produced, it is a definite proof of the fact that loan has been given to an accused. Nonetheless this is not a statutory requirement. 23. The advancement of loan in cash may entail negative consequences for a party especially an Income Tax assessee as his having acted in breach of Section 269SS of Income Tax Act, 1961. Chapter XXB provides for the requirement as to the mode of acceptance, payment or repayment in certain cases to counteract evasion of tax. Section 269SS mandates that no person, after the cut off date shall take or accept from any other person any loan or deposit otherwise than by an account payee cheque or an account payee bank draft if the amount is more than Rs. 10,000/-. Breach of Section 269SS of the Income Tax Act provides penalty to which a person would be subjected to under Section 271D. 24. However, Section 271D does not pr....