TaxTMI 
TaxTMI 
2022 (1) TMI 556
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....lainant. 2. Precisely, the facts as emerge from the record are that respondent-complainant (hereinafter referred to as 'complainant') instituted a complaint under Section 138 of the Act in the Court of learned Chief Judicial Magistrate, Kullu, Lahaul and Spiti at Kullu, alleging therein that he had received compensation on account of acquisition of his house and land in the year 2015. In April, 2015, accused approached him with the request to lend him Rs. 10 lac to run the business. Complainant alleged that he on the request of accused paid Rs. 10 lac to the accused, who with a view to discharge his lawful liability, issued cheque Ext. CW-1/B, dated 27.07.2015, amounting to Rs. 10 lac, payable at PNB, Bajaura Branch, in favour of the complainant. However, fact remains that aforesaid cheque on its presentation was dishonoured on account of 'insufficient funds' and same was returned to him vide memo dated 01.08.2015, i.e. Ext. CW- 1/C. After receipt of aforesaid memo, complainant issued legal notice Ext.CW-1/D to the accused asking him to make the payment good within a period of 15 days, but since, he failed to make the payment good within the time stipulated in the legal notice, he....
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....d issued blank cheque as security to the complainant, but he has misused the same. Since, issuance of cheque as well as signatures thereupon are not disputed by accused, there is a presumption of issuance of cheque in favour of complainant by the accused for discharge of his lawful liability. 8. With a view to prove his case, complainant besides stepping himself in the witness box also examined Somawati as CW-1 and Sh. Rahul Negi as CW-2. Complainant tendered his evidence by way of affidavit Ext. CW-3/A, whereby he stated the case verbatim as has been stated in the complaint filed under Section 138 of the Act. While admitting that accused is brother-in-law (Behnoi) of his son-in-law, this witness categorically denied that he used to lend money on interest. He also denied that accused had only borrowed sum of Rs. 3 lac in the year 2015 and out of such money, he had repaid Rs. 1,70,000/-. This witness categorically stated that accused borrowed sum of Rs. 10 lac from him and till date he has not repaid single penny. This witness specifically denied suggestion put to him that he had obtained blank cheque from the accused as security. He also denied that he himself filled up rupees 10 ....
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....nder Section 118 and 139 of the Act, is applicable in favour of complainant. No doubt, aforesaid presumption is rebuttable, but for that purpose accused is to raise probable defence either by leading some positive evidence or to refer to the evidence led on record by the complainant. However, in the case at hand, no probable defence has been raised by the accused to rebut the presumption of issuance of cheque for discharge of lawful liability by him in favour of complainant. Since, in the instant case, factum with regard to issuance of cheque and signatures thereupon stands duly admitted by accused, learned courts below rightly took no cognizance of his statement recorded under Section 313 Cr.P.C that cheque issued by him was towards security and not for the discharge of his lawful liability. 13. Reliance in this regard is placed upon judgment rendered by Hon'ble Apex Court in Rohitbhai Jivanlal Patel v. State of Gujarat, (2019) 18 SCC 106, wherein, it has been held as under: "18. In the case at hand, even after purportedly drawing the presumption under Section 139 of the NI Act, the Trial Court proceeded to question the want of evidence on the part of the complainant as reg....
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....ss, in my presence, had demanded Rs. 22,50,000/- (Rupees twenty two lacs fifty thousandly) on temporary basis. And thereafter, the complainant from his family members by taking in piecemeal had given to the accused in my presence. Thereafter, on demanding the money by the complainant, the accused had given seven (7) cheques to the complainant in our presence but such cheques being washed out in rainy water and on informing me by the complainant I had informed to the accused. Thereafter, Rohitbhai had given other seven (7) cheques to the complainant in my presence and the deed was executed on Rs. 100/- stamp paper in there is my signature." 19.3 This witness was cross-examined on various aspects as regards the particulars in the writing on the stamp paper and the date and time of the transactions. In regard to the defence as put in the cross-examination, the witness stated as under: "I have got shop in National Plaza but in rain no water logging has taken place. It is not true that there had been no financial dealings between me and the accused today. It is not true that I had given rupees ten lacs to the accused Rohitbhai on temporary basis. It is not true that for the amount g....
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....culties having been arised, I have taken Rs. 22,500,000/- (Rupees twenty two thousand fifty thousand only- sic) from my group which are to be paid to Shashimohan Goyanka. With reference to that today I have given seven (7) cheques of Corporation Bank, Alkapuri Branch bearing No. 763346 to 762252 amounting to Rs. 22,50,000/- (Rupees twenty two lacs fifty thousand only) Dates : (1) 01/4/08, (2) 01/05/08 (3) 01/07/08, (4) 01/08/08 (5) 01/10/08 (6) 01/11/08 (7) 01/12/08 the account of which is 40007. Earliest these cheques were given but due to rainy water logging the said cheques having been washed out (7) cheques have again been given which is acceptable to me." 19.6 The fact of the matter remains that the appellant could not deny his signatures on the said writing but attempted to suggest that his signatures were available on the blank stamp paper with Shri Jagdishbhai. This suggestion is too remote and too uncertain to be accepted. No cogent reason is available for the appellant signing a blank stamp paper. It is also indisputable that the cheques as mentioned therein with all the relevant particulars like cheque numbers, name of Bank and account number are of the same cheques ....
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.... this Court in the matter of Rangappa vs. Sri Mohan [3] held that Section 139 is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies the strong criminal remedy in relation to the dishonour of the cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. The Court however, further observed that it must be remembered that the offence made punishable by Section 138can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose money is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the defendant accused cannot be expected to discharge an unduly high standard of proof". The Court further observed that it is a settled position that when an accused has to rebut the presumption under Section 139, the standard of proof for doing so is all preponderance of probabilities. 2....
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.... or in part, of a debt or liability. True, it is that to rebut aforesaid presumption accused can always raise probable defence either by leading some positive evidence or by referring to the material, if any adduced on record by the complainant. But in the case at hand, accused has miserably failed to raise probable defence much less sufficient to rebut the presumption applicable in favour of the complainant under Section 118 and 139 of the Act. 16. Reliance was also placed on following judgments i.e. K. Subramani v. K. Damodara Naidu (2015) 1 SCC 99, Basalingappa v. Mudibasappa (2019) 5 SCC 418 and Krishna Janardhan Bhat vs Dattatraya G. Hegde, (2008) 4 SCC 54, perusal of aforesaid judgments reveals that in all the cases before Hon'ble Apex Court, transactions were of huge amount and in all those cases, accused were able to raise probable defence that the cheques were not issued in discharge of legally enforceable liability. However, the complainant has advanced only Rs. 10 Lakh in the case at hand, coupled with the fact there is no denial on the part of the accused that the cheque does not bear his signatures, as such, there is presumption in favour of complainant that the c....