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2023 (7) TMI 1058
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.... under Section-138 of the Negotiable Instrument Act, 1881. [3] The brief facts of the present case is that one complaint has been filed by the complainants alleging, inter alia that all the complainants and the accused person had done business of brick industry and construction works with M/S Vida Engg.Co. Ltd. Kolkata and after departure of the said Vida Engg. Co. Ltd the accused made attorney on behalf of the said Vida Engg. Co. Ltd. to continue with their works at Belonia and in continuation of brick industry business of M/S Santoshi Maa Brick Industry, Sonaichari owned by the complainants and accused, they jointly took loan from SBI, Belonia Branch which became NPA and the residence of Milan Pal was attached as mortgaged land which is located just adjacent to the Belonia P.S and due to liability taken by the accused to pay the bank loan by himself, on 19.12.2016 an agreement was executed by all the partners and during the execution of agreement the accused issued 4 (four) cheques amounting to Rs.10,00,000/-(Rs.Ten Lakh) each in the name of all the complainants on the liability of repay the loan amount to be paid on or before 29.09.2017 and thereafter as the date was coming nea....
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....of law and facts in appreciating the facts and circumstances of the case in acquitting the respondent No.1. The learned Court below has erred in holding that only photocopy of the return memo was submitted but, the records would reveal that except one, all other original return memos were filed and even the photocopy of one of the said return memo has been admitted into evidence without any objection by and on behalf of the respondent No.1. [8] The learned Court below has overlooked the reply filed on behalf of the respondent No.1 through his learned advocate on 20.11.2017 wherein, he admitted his in-debtness. The learned Court below has arrived at a wrong decision as to the legal demand notice and in so arriving he misconstrued and misunderstood the decision in Suman Sethi v. Ajay K. Churiwal and another reported in (2000) 2 SCC 380 which was a case where in addition to the dues under the cheques certain other payments were asked for and in that backdrop the Apex Court referred to the decision of the High Court which set aside the decision of the learned trial Judge holding that the notice was valid one and the High Court on finding that the amounts in the notice being severable ....
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....lainant and has wrongly and illegally arrived at the opinion referring to the business and other facts including that the cheques were allegedly issued on 19.12.2016 while the cheques themselves bear the date i.e. 31.07.2017. [12] In support of the case of the appellants, Mr. Deb, learned senior counsel has placed his reliance on a decision of the Apex Court in Rohitbhai Jivanlal Patel v. State of Gujarat and Another, reported in (2019) 18 SCC 106, wherein, the Court has held thus: "6.1. The High Court observed that if the transaction in question was not reflected in the accounts and income-tax returns, that would at best hold the assesse or lender liable for action under the income-tax laws but, if the complainant succeeds in showing the lending of amount, the existence of legally enforceable debt cannot be denied. The High Court also observed that the issue regarding washing away of the cheques in rain water was of no significance when the accused had accepted his liability in clear terms. The High Court found that the defence plea of the accused that the money was given as hand loan by his friend Shri Jagdishbhai got falsified by the version of the said Shri Jagdishbhai, who ....
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....he presumption that the cheque concerns a legally enforceable debt or liability. Of course, this presumption is in the nature of rebuttal and onus is on the accused thereafter to raise a probable defence. 64. As can be noted from the chronology of events and the material that has been placed before this Court that the defence raised by the accused is not at all probable. The respondent No.2-accused states that the money was given as a hand loan by his friend Jagdishbhai and not the appellant, also gets falsified completely by the version of Jagdishbhai. It appears that in case of all the seven cheques when notices were given prior to the filing of the complaint, he has chosen not to reply to four of the notices. Either on account of insufficiency of the funds or because he has closed account that the cheques could not be realized. All these circumstances cumulatively lead this Court to conclude that the appellant succeeded in proving the legally enforceable debt and no probable defence for rebutting the statutory presumption is raised by the respondent No.2. 65. Initial presumption as contemplated under section 139 of the Negotiable Instruments Act, when the proof of lending o....
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....mptions under Sections 118 and 139 of the NI Act and rebuttal thereof in the following:- "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 is based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttal 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. 27. Section 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 Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption un....
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.... Patel v. Hitesh Mahendrabhai Patel and Another, reported in (2023) 1 SCC 578 wherein, the Court has observed thus: "20. The judgments of this Court on post-dated cheques when read with the purpose of Section 138 indicate that an offence under the provision arises if the cheque represents a legally enforceable debt on the date of maturity. The offence under Section 138 is tipped by the dishonour of the cheque when it is sought to be encashed. Though a post- dated cheque might be drawn to represent a legally enforceable debt at the time of its drawing, for the offence to be attracted, the cheque must represent a legally enforceable debt at the time of encashment. If there has been a material change in the circumstance such that the sum in the cheque does not represent a legally enforceable debt at the time of maturity or encashment, then the offence under Section 138 is not made out. 21. The appellant contended that the cheque was issued by the first respondent on 17 March 2014. However, the payment of rupees 4,09,3015 received from the first respondent was between 8 April 2012 and 30 December 2013. It was contended that since the payments were made before the issuance of chequ....
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.... was issued by the first respondent for security on the date when the loan was borrowed. It was also categorically recorded by the Courts below that a sum of rupees 4,09,315 that was paid by the first respondent was paid to partly fulfil the debt of rupees twenty lakhs. The appellant in his cross-examination has stated that a "cheque against a cheque" was given when he loaned the sum of rupees twenty lakhs. Thus, it can be concluded that the cheque was given as a security to discharge the loan, either undated or dated as 17 March 2014. Merely because the sum of rupees 4,09,315 was paid between 8 April 2012 and 30 December 2013, which was after 17 March 2014, it cannot be concluded that the sum was not paid in discharge of the loan of rupees twenty lakh. The sum of rupees 4,09,315 was paid after the loan was lent to the first respondent. The appellant in his cross- examination has not denied the receipt of the payments. He has also stated it was not received as a "gift or reward". In view of the above discussion, at the time of the encashment of the cheque, the first respondent did not owe a sum of rupees twenty lakhs as represented in the cheque at the time of encashment of the che....
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.... etc. are separately specified, other such claims for interest, cost etc. would be superfluous and these additional claims would be severable and will not invalidate the notice. If, however, in the notice an omnibus demand is made without specifying what was due under the dishonoured cheque, the notice might well fail to meet the legal requirement and may be regarded as bad." [16] After hearing the legal representatives of the parties and having observed the observations made in different citations, let us revisit the evidence and application of law and the facts of the instant case. The respondent No.1 admitted of issuing of 04 cheques vide Exbt.2 i.e. to say in reply of notice but at the same time he submitted that the issuing of cheques was not voluntary and the said cheques were acquired on mistreatment of the complainants. Although he denied having given cheques to the complainants voluntarily in reply of notice as well as during examination u/s 313 of Cr.P.C. but he did not substantiate his denial with any evidence. [17] Hon'ble Apex Court in Suman Sethi v. Ajay K. Churiwal and Another, reported in(2000) 2 SCC 380 has held thus: "8. It is a well-settled principle of law th....
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..... 13,50,000/-. Hence, the notice in question is imperfect in this case as it did not specifically contain any demand for the payment of the cheques amount. [21] Once the fundamental ingredients which gives rise to cause of action under Section-138 of N. I. Act have been established a mandatory presumption under Section-139 of N. I. Act, is effected in favour of complainant and it also extends to the existence of legally enforceable liability itself. A three judged bench of Hon'ble Apex Court in Rangappa v. S. Mohan, reported in (2010) 11 SCC 441 has held that: "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 the extent, the impugned observations in Krishna Janardhan Bhat (supra) may not be correct. However, this does not in any way case 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 existe....
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....se the mortgage properties of various bank loan accounts. [24] It is further alleged that after many differences between the existing and retired partners regarding the outstanding loan they agreed Asish Datta (Arbitrator) that Rakhal Mallik takes full and final responsibility for release the mortgage properties by liquidating the outstanding balance of SBI A/C No. 11866553823 (C/C) and other partners shall not liable for outstanding balance, therefore, accused Rakhal Mallik issued 04 cheques in total of Rs. 40,00,000/- i.e. Rs. 10,00,000/- each to the Khokan Ch. Bhowmik, Milan Paul, Bisweshwar Datta and Ratan Mallik vide No. 360094, 360093, 360096 and 360095 post dated on 19.12.2016 A/C No. 34015610600 of SBI on the condition that they deposited the said cheque in their bank account for encash if Rakhal Mallik fails to release the mortgage properties by liquidating the outstanding balance on or before 31.07.2017. Complainants also stated that accused person fail to release the mortgage properties then he shall pay the government value of those mortgage property to their respective owners and accused takes necessary steps for enfranchise mortgage property of said loan account if b....
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....e the court and it is also admitted by the complainants in their cross-examination. Learned counsel seriously disputed and denied the legal debt and liability on accused person on the ground that on the date of execution of cheque as alleged by the complainant there was no existing debt or liabilities. In the present case, for the purpose of ready reference reproducing the cross-examination the complainants, i.e. PW 1, PW 2, PW 3 and PW 4 which are somewhat similar in nature as thus: "...It is a fact the hand writing and ink used for writing the date in his cheque is different that of the ink and hand writing of the remaining portion of the same but they did not submit any document as regard alleged appointment of the accused as the Attorney on behalf of Vida Engineering Co. Ltd and also did not submit any document regarding their partnership with the accused in connection with 14.01.2019 Santoshi Ma Brick Industries. They had not submitted any document in this case regarding any dissolution of their partnership and did not submit any document that their partnership firm is indebted to the State Bank of India, Belonia Branch for an amount of Rs. 40,00,000/-. They did not submit any....
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....so admitted by the complainants in their cross-examination. Complainant stated that on the basis of deed of addendum accused had taken liability to liquidate the outstanding balance of SBI account No. 1186553823(CC) but no such bank account is proved before the court and the original deed of retirement was also not placed before the court which was executed as alleged in the deed of addendum on 28.06.2013 Sl. No. 2640/2013. Notice issued by the complainant for the payment of bounced cheque amount is not contain cheque amount, as discussed above, hence, the notice in this connection is imperfect as it did not specifically content in demand for the cheque amount. [31] For the purpose of reference, Section-141 of the Negotiable Instruments Act, 1881 concerns itself with situations where the offence of dishonour of cheque, as provided under Section 138, is committed by a company (including a partnership firm). This section mandates that when a company commits an offence under Section-138, every person who, at the time the offence was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed t....