TaxTMI 
TaxTMI 
TaxTMI 
2022 (1) TMI 1005
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....osit and expenses required for ensuring the employment. Towards part payment of the same, the appellant paid an amount of Rs. 3.5 lakhs and agreeing to pay the balance amount at a later point of time. However, the 1st respondent could not arrange the employment as offered and hence the 1st respondent had agreed to repay the amount which he collected from the appellant. Towards part payment of the said amount, Rs. 2 lakhs was paid in the year, 2008 by keeping a balance amount of Rs. 1.5 lakhs. It was pointed out that the appellant had arranged an amount of Rs. 3.5 lakhs by borrowing the said amount from his sister-in-law's fixed deposit in the co-operative bank for which he had to pay the monthly interest at the rate of Rs. 4,000/-. Later, the appellant was compelled to discharge the liability of the sister-in-law by raising loan from others by paying high interest. In such circumstances, the 1st respondent being aware of the manner in which the appellant raised the funds to pay an amount of Rs. 3.5 lakhs, the 1st respondent agreed to repay an amount of Rs. 3 lakhs, apart from Rs. 2 lakhs already given to the appellant, towards final settlement (Rs. 1.5 lakhs towards the balance....
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....upp) SCC 31, Vijay Alias Chinee v. State of Madhya Pradesh [ (2010)8 SCC 191], Hitel P. Dalal v. Bratindranath Banerjee [ (2001)6 SCC 16] and Rangappa v. Sri. Mohan [2010(2) KLT 682]. 7. On the other hand, the learned counsel for the 1st respondent would contend that the presumption available under Section 118 and 139 of the Negotiable Instruments Act are rebuttable presumptions. It is suffice for the accused to establish a probable case against the said presumption and upon establishing such a probable case, the burden of proof shifts to the complainant. In this case, it was pointed out that, the specific case of the 1st respondent is that, he has not issued any cheque in favour of the appellant. In the year, 2007, he lost certain cheques and therefore he submitted stop memo in respect of the said lost cheques on 24.5.2010 which is discernible from Ext. C2. Exhibit P1 cheque is claimed to have been issued on 16.5.2011 which is almost a year after the stop memo was issued. The learned counsel for the 1st respondent also relies on the evidence on DW1, the Manager of the Bank who has stated that, the stop memo was issued by the 1st respondent on the reason that cheques were lost. In....
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....h relevant. In his 313 statement he specifically denied having issued any cheque in favour of the appellant herein. On going through the cross examination of PW1, it is discernible that the case of the 1st respondent is that the cheque leaves including Ext. P1 cheque were lost in the year, 2007. While he was working in the office of FCI West Hill, Kozhikode where the appellant and the 1st respondent worked together. The evidence of DW1 would indicate that the stop memo was issued by the 1st respondent as evidenced by Ext. C2 on the reason that the cheque leaves were lost. 10. Apart from the above, there are certain improbabilities in the case of the appellant as well, which would fortify the defence taken by the 1st respondent. Even according to the appellant, the actual amount due from the 1st respondent is Rs. 1.5 lakhs. The remaining amount of Rs. 1.5 lakhs was fixed as the compensation for the additional expenses incurred by the appellant for arranging the amount of 3.5 lakhs for making the payment to the 1st respondent for his son. According to the appellant, the said amount was arranged by him by borrowing the same from the fixed deposit in the name of his sister-in-law. He ....
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....n initial presumption which favours the complainant. S. 139 of the Act 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 S. 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under S. 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by S. 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact 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 accused/defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under S. 139, the standard of pro....
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....ed about the existence of the reverse onus in favour of the appellant. However, the said presumption comes into play only when the execution of the cheque is proved. In this case, the execution of cheque is specifically denied by the 1st respondent. He has a case that the cheque was lost by him in the year 2007 while he was working at FCI, Kozhikode. It is an admitted fact that, at the relevant time, the appellant was also working there. The evidence of DW1 coupled with Ext. C2 document would reveal that as early as on 24.5.2010, the 1st respondent had issued a stop memo in respect of a cheque in question. The issuance of cheque even according to the appellant is almost a year after the said date. When all these aspects are taken into consideration, the execution of the cheque itself is in doubt. 13. Even if it is assumed for argument for the sake that, the aforesaid cheque was indeed issued by the 1st respondent, even then the evidence adduced by the appellant would indicate a probable case which will have the impact of rebutting the presumption available under Section 139 of the Negotiable Instruments Act. In Rangappa's case (supra), in the observation as extracted above, th....