TaxTMI 
TaxTMI 
2022 (6) TMI 1208
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....n The Sabarkantha District Central Co-op. Bank Ltd., Prantij Branch of Account No. 8091, which, the complainant presented in bank, but the same was returned by the bank with an endorsement "Account Closed" and hence, the complainant issued a legal notice dated 07.12.2014 to the respondent No. 2 through his advocate by RPAD and UPC, which though served upon the respondent No. 2 on 11.12.2014, the respondent No. 2 did not repay the said amount and gave vague reply on 15.12.2004, the complainant was constrained to file complaint before the competent Court at Prantij under Section 138 of the Negotiable Instruments Act, 1881 (herein after referred to as "the NI Act"). 2.1 Upon such complaint being filed and subsequent to service of summons, the respondent No. 2 appeared before the Court. Since the accused did not plead guilty, trial was proceeded against him. In support, the appellant - complainant has produced oral as well as documentary evidence. Vide impugned judgment and order dated 10.06.2014, the learned trial Judge acquitted the accused person. Being aggrieved by the same, the appellant - original complainant has preferred the present appeal. 3. Heard, learned advocate Mr. ....
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....Rs.2 lakh from his friend Arvindbhai Chimanbhai Patel and rest Rs.14 lakh, he had arranged from his personal savings and accordingly, the amount in question was very well explained, however, the learned trial Judge has disbelieved the same and observed that considering the status of the appellant - complainant as Secretary and his salary of Rs.1,000/- per month as well as the income from agriculture which is maximum Rs.4 lakh, the same raises doubt as regards lending of such a huge amount to the respondent - accused. The learned advocate for the appellant - complainant also submitted that the learned trial Judge also erred in observing that the appellant - complainant has not disclosed such income before the Income Tax Department nor has produced any books of accounts and thereby, has failed to appreciate the fact that agriculture income is exempted under the Income Tax Act. 3.5 The learned advocate for the appellant - complainant further submitted that as per the case of the respondent - accused, he had issued the cheque as one Kodarbhai had borrowed Rs.10,000/- because of illness of his son, against security, on behalf of Kodarbhai. However, it cannot be believed that the resp....
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....h is just and proper. She submitted that it is trite law that if two views are possible on the basis of the evidence on record, the appellate Court should not disturb the finding of acquittal recorded by the trial Court. Further, while exercising the powers in appeal against the order of acquittal, the Court of appeal would not ordinarily interfere with the order of acquittal unless the approach of the lower Court is vitiated by some manifest illegality. 4.1 The learned advocate for the respondent No. 2 - accused submitted that for invoking the provisions of Section 138 of the NI Act, the debt or other liability means a legally enforceable debt or other liability, which the complainant has failed to prove and accordingly, the learned trial Judge has rightly recorded acquittal. She streneously submitted that at the relevant time, the income of the appellant - complainant, admittedly was Rs.1,000/- per month. Further, he had an agriculture income ranging from Rs.2.5 lakh to Rs.4 lakh per annum, however, there are other family members also and accordingly, the learned trial Judge has rightly raised suspicion as to saving of such amount by the complainant and lending the huge amount....
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....der of acquittal, the Court of appeal would not ordinarily interfere with the order of acquittal unless the approach of the lower Court is vitiated by some manifest illegality and the conclusion arrive at would not be arrived at by any reasonable person, and therefore, the decision is to be characterized as perverse. 6.3 Merely because two views are possible, the Court of appeal would not take the view which would upset the judgment delivered by the Court below. However, the appellate Court has a power to review the evidence if it is of the view that the conclusion arrived at by the Court below is perverse and the court has committed a manifest error of law and ignored the material evidence on record. That the duty is cast upon the appellate Court, in such circumstances, to re-appreciate the evidence to arrive to just decision on the basis of material placed on record to find out whether the accused is connected with the commission of the crime with which he is charged. 6.4 In Mallikarjun Kodagali (Dead) represented through Legal Representatives v. State of Karnataka and Others, (2019) 2 SCC 752, the Apex Court has observed that, "The presumption of innocence which is attache....
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....v. State of A.P (2009) 16 SCC 98 and Ram Singh v. State of H.P (2010) 2 SCC 445) 13. In Sheo Swarup v. King Emperor AIR 1934 PC 227, the Privy Council observed as under: (IA p. 404) "... the High Court should and will always give proper weight and consideration to such matters as (1) the views of the trial Judge as to the credibility of the witnesses; (2) the presumption of innocence in favour of the accused, a presumption certainly not weakened by the fact that he has been acquitted at his trial; (3) the right of the accused to the benefit of any doubt; and (4) the slowness of an appellate court in disturbing a finding of fact arrived at by a Judge who had the advantage of seeing the witnesses." 14. The aforesaid principle of law has consistently been followed by this Court. (See Tulsiram Kanu v. State AIR 1954 SC 1, Balbir Singh v. State of Punjab AIR 1957 SC 216, M.G. Agarwal v. State of Maharashtra AIR 1963 SC 200, Khedu Mohton v. State of Bihar (1970) 2 SCC 450, Sambasivan v. State of Kerala (1998) 5 SCC 412, Bhagwan Singh v. State of M.P(2002) 4 SCC 85 and State of Goa v. Sanjay Thakran (2007) 3 SCC 755) 15. In Chandrappa v. State of Karnataka (2007....
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....this Court and laid down that: (SCC p. 374, para 20) "20. ... an order of acquittal should not be lightly interfered with even if the court believes that there is some evidence pointing out the finger towards the accused." 18. In State of U.P. v. Banne (2009) 4 SCC 271, this Court gave certain illustrative circumstances in which the Court would be justified in interfering with a judgment of acquittal by the High Court. The circumstances include: (SCC p. 286, para 28) "(i) The High Court's decision is based on totally erroneous view of law by ignoring the settled legal position; (ii) The High Court's conclusions are contrary to evidence and documents on record; (iii) The entire approach of the High Court in dealing with the evidence was patently illegal leading to grave miscarriage of justice; (iv) The High Court's judgment is manifestly unjust and unreasonable based on erroneous law and facts on the record of the case; (v) This Court must always give proper weight and consideration to the findings of the High Court; (vi) This Court would be extremely reluctant in interfering with a case when both the Sessions Court and the High ....
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....peal against acquittal. This Court considered catena of decisions of this Court right from 1952 onwards. In paragraph 31, it is observed and held as under: "31. An identical question came to be considered before this Court in Umedbhai Jadavbhai (1978) 1 SCC 228. In the case before this Court, the High Court interfered with the order of acquittal passed by the learned trial court on reappreciation of the entire evidence on record. However, the High Court, while reversing the acquittal, did not consider the reasons given by the learned trial court while acquitting the accused. Confirming the judgment of the High Court, this Court observed and held in para 10 as under: (SCC p. 233) "10. Once the appeal was rightly entertained against the order of acquittal, the High Court was entitled to reappreciate the entire evidence independently and come to its own conclusion. Ordinarily, the High Court would give due importance to the opinion of the Sessions Judge if the same were arrived at after proper appreciation of the evidence. This rule will not be applicable in the present case where the Sessions Judge has made an absolutely wrong assumption of a very material and clinc....
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.... the court comes to the conclusion that the judgment of the trial court does not suffer from any infirmity, it cannot but be held that the interference by the appellate court in the order of acquittal was not justified; then in such a case the judgment of the appellate court has to be set aside as of the two reasonable views, the one in support of the acquittal alone has to stand. Having regard to the above discussion, we shall proceed to examine the judgment of the trial court in this case." 31.2. In K. Ramakrishnan Unnithan v. State of Kerala (1999) 3 SCC 309, after observing that though there is some substance in the grievance of the learned counsel appearing on behalf of the accused that the High Court has not adverted to all the reasons given by the trial Judge for according an order of acquittal, this Court refused to set aside the order of conviction passed by the High Court after having found that the approach of the Sessions Judge in recording the order of acquittal was not proper and the conclusion arrived at by the learned Sessions Judge on several aspects was unsustainable. This Court further observed that as the Sessions Judge was not justified in discarding t....
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....n vitiated. (See in this connection the very cases cited at the Bar, namely, Surajpal Singh v. State AIR 1952 SC 52; Wilayat Khan v. State of U.P AIR 1953 SC 122) In our opinion, there is no substance in the contention raised on behalf of the appellant that the High Court was not justified in reviewing the entire evidence and coming to its own conclusions. 31.4. In K. Gopal Reddy v. State of A.P. (1979) 1 SCC 355, this Court has observed that where the trial court allows itself to be beset with fanciful doubts, rejects creditworthy evidence for slender reasons and takes a view of the evidence which is but barely possible, it is the obvious duty of the High Court to interfere in the interest of justice, lest the administration of justice be brought to ridicule." (emphasis supplied)." 7. In the aforesaid backdrop, if Section 138 of NI Act is seen, it speaks as under: "138. Dishonour of cheque for insufficiency, etc., of funds in the account. - Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or ....
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.... conclusion that the debt cannot be said to be the legally enforceable debt, which is sine qua non in such matters and the complainant has failed to prove the same beyond reasonable doubt. 7.2 Further, under Sections 118(a) and 139 of the NI Act, there are provisions as regards presumption. At this juncture, a beneficial reference may be made to a decision of the Apex Court in Basalingappa v. Mudibasappa, MANU/SC/0502/2019 : (2019) 5 SCC 418, wherein, the Court has observed as under: "23. We having noticed the ratio laid down by this Court in the above cases on Sections 118(a) and 139, we now summarise the principles enumerated by this Court in following manner: 23.1. Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability. 23.2. The presumption Under Section 139 is a rebuttable presumption and the onus is on the Accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities. 23.3. To rebut the presumption, it is open for the Accused to rely on evidence led by him or the Accus....
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....le to save all his earnings from the agriculture. Further, it is not the income of the complainant only and his family members do also have share in the said income. Further, the complainant has also not stated as to whether the said amount was deposited in the bank or was kept at his home only. In para 17, it is observed that the complainant has not made any agreement/writing as to the lending of Rs.20 lakh to the accused. Referring the document at Exh. 50, the learned trial Judge has observed in para 18 of the impugned judgment that it is specifically mentioned therein that the accused had never taken, either from the mandli or from the complainant personally, any amount nor any outstanding was there from the accused. It is also observed by the learned trial Judge that if at all the said certificate was issued in the capacity of Secretary of the mandli only, the complainant could have made mention of the mandli only and not as regards any personal transactions. Thus, considering all these aspects of the matter, the learned trial Judge has come to a conclusion that the accused has succeeded in rebutting the presumption, showing preponderance of probability. 7.4 On re-appreciati....
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....opriation against the complainant and was dismissed from service. 7.5 Thus, on re-appreciation and reevaluation of the oral as well as the documentary evidence on record, it transpires that the complainant has failed to prove the case against the accused beyond reasonable doubt inasmuch as the ingredients of the offence alleged are not fulfilled. The Court has gone through in detail the impugned judgment and order and found that the learned trial Judge has meticulously considered evidence on record and come to such a conclusion. 8. The Court has gone through the decisions relied upon by the learned advocate for the appellant and the respondent - accused. In the decision in Bir Singh (supra), the Court has held that, "Section 139 mandates that unless the contrary is proved, it is to be presumed 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. However, the presumption is rebuttable by proving to the contrary. Section 139 introduces an exception to the general rule as to the burden of proof and shifts the onus on the accused to prove by cogent evidence that there was ....
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....t himself, in the certificate, Exh. 50 issued by him, there was no outstanding from the respondent - accused, either of mandli or in personal capacity and accordingly, the respondent - accused has succeeded in raising probable defence. 9.1 In the latest decision of the Apex Court in Anss Rajashekar (supra), as relied by the learned advocate for the respondent - accused, the Court observed that, "Besides what has been set out above, an important facet in the matter was that the complainant failed to establish the source of funds which he is alleged to have utilized for the disbursal of the loan of Rs.15 lakhs to the appellant". It is further observed that, "His defence that there was an absence of a legally enforceable debt was rendered probable on the basis of the material on record. Consequently, the order of acquittal passed by the first appellant Court was justified". Accordingly, the Court restored the order of acquittal. In the case on hand also, the complainant has failed to discharge the initial burden of proving the legally enforceable debt. Moreover, the complainant has also failed to establish the source of funds with cogent evidence. Further, as said in the earlier pa....