TaxTMI 
TaxTMI 
2011 (4) TMI 1528
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.... acknowledgement of the loan and for the repayment thereof, six different cheques bearing dated 23-2-2004 and one cheque amounting to ₹ 10,000/- dated 16.02.2004 were issued by her in his favour. The total loan amount comes to ₹ 2,10,000/-. The respondent, however, requested the petitioner to encash the cheques later on so that necessary funds could be arranged by her. In the meantime, the husband of the respondent died sometime in the month of August-September, 2003 and as a result, respondent requested the petitioner to wait for sometime for encashing the cheques as she was due to receive the amounts payable to her from LIC for which the accused No. 2 and 3 were the nominees. In the month of December, he made enquiries in the Bank about the availability of fund in the account of the respondent as he was badly in need of money for the education of his son but found from the Bank that there was insufficient fund. The petitioner thereafter repeatedly requested the respondent to return the money and issued the letter dated 15-12-2003 to that effect, but the respondent asked for time till February, 2004. Finally, he in consultation with the respondent presented the cheques....
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.... onus of proving that the cheques were not issued for discharging her debt to the petitioner. It is also the contention of the learned counsel for the petitioner that the learned Chief Judicial Magistrate has failed to appreciate that no prudent person like the respondent would issue a cheque unless she had a liability to discharge and has in the process reached a wrong conclusion. She, therefore, strenuously urges this Court to reverse the findings of the trial court and return a verdict of guilty against the respondent. 4. On the other hand, Mr. S. Sen, the learned counsel for the respondent, supports the impugned judgment of acquittal and submits that no serious infirmity could be pointed out by the petitioner warranting the interference of this Court. He next contends that the petitioner has miserably failed to prove that he paid any money or loan to the respondent, and when the respondent never took any loan from the petitioner, there is no question of issuing cheques to him: the cheques are never issued or signed by her and they were forged by the petitioner himself. It is also contended by him that when no separate document was executed for huge loans amounting to a total o....
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....person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for a term which may extended to two years, or with fine which may extend to twice the amount of that cheque, or with both. Provided that nothing contained in this section shall apply unless─ (a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier; (b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and (c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice. Explanation.─For the purpose of this section, "debt or other liability" means a legally enforceable debt or other liability. 13....
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....been issued for discharge of any debt or other liability. The controversy resulting from this decision has now been finally resolved by a three-Judge Bench of the Apex Court in Rangappa v. Sri Mohan, (2010) 11 SCC 441 . The relevant portion of the judgment is found at para 26, which read thus: "26. In the light of these extracts, we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant." (Emphasis mine) 7. In the same judgment, the larger Bench also dealt with the standard of proof expecte....