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2014 (6) TMI 1074
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....um of Rs. 8,54,000/- drawn on Canara Bank, Chennai Branch. When the said cheque was presented, it was dishonoured with an endorsement 'funds insufficient'. The complainant got issued a legal notice demanding to pay the cheque amount and the same was returned on 04.10.2005 with an endorsement addressee continuously absent. Hence the complaint. 3. After recording sworn statement of the complainant, the case was taken cognizance and the accused, who appeared before the Court pursuant to the summons and after supply of case copies under Section 207 of the Code of Criminal Procedure (for brevity, "Cr.P.C."), when questioned on substance of accusation under Section 251 Cr.P.C., he pleaded not guilty. 4. During the course of trial, on behalf of the complainant, complainant himself was examined as PW.1 and got marked Exs. P.1 to P.8, which include Ex. P.1 promissory note, Ex. P.2 cheque (supra), Ex. P.3 pay slip, Exs. P.4 and P.5 cheque return memos, Ex. P.6 office copy of legal notice, dated 26.09.2005, Exs. P.7 and P.8 returned postal covers, dated 04.10.2005. On behalf of the accused, DWs.1 to 3 were examined and got marked Exs. D.1 to 3 including served copy of plaint in ....
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....e presumptions available against him? 2) To what result?" 10. In re. Point No. 1: 10-(A). Before adverting to the merits of the matter, it is beneficial to quote; the provisions incorporated in Chapter XVII of the N.I. Act make a civil transaction to be an offence by fiction of law and with certain (rebuttable) presumptions that shall be drawn. Sections. 138 to 142 are incorporated in the N.I. Act as Chapter XVII by the Banking Public Financial Institutions and Negotiable instruments Laws (Amendment) Act, 1981 (66 of 1988) which came into force w.e.f. 01-04-1989 and the N.I. Act was further amended by Act, 2002 (55 of 2002) which came into force w.e.f. 06-02-2003 incorporating new sections 143 to 147 in this Chapter XVII and further some of the existing provisions not only of the Chapter XVII, but also of other Chapters amended to overcome the defects and drawbacks in dealing with the matters relating to dishonour of cheques. 10-(B). The object and intention of these penal provisions of Chapter XVII (Sections 138-147), in particular, Sections 138 & 139 (besides civil remedy), are to prevent issuing of cheques in playful manner or with dishonest intenti....
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....r the provision for issuing notice within fifteen days (amended as thirty days by the amended Act, 55 of 2002, w.e.f.06-02-2003) under section 138 after dishonour is to afford an opportunity to the Drawer of the cheque to rectify his mistakes or negligence or in action and to pay the amount within fifteen days of receipt of notice, failing which the drawer is liable for prosecution and penal consequences. 10-(E). Reasonability of cause for non-payment is not at all a deciding factor. Mens rea is irrelevant. It is a strict liability incorporated in public interest. 10-(F). Availability of alternative remedy is no bar to the prosecution 10-(G). In the words-where any cheque, the word any suggests that for whatever reason if a cheque is drawn on an account maintained by him with a Banker in favour of another person for the discharge of any debt or other liability, the liability cannot be avoided in the event of the cheque stands returned by the Banker unpaid. 10-(H). In Suman Sethi v. Ajay K. Churiwal and Another [2000] 2 SCC 380, it was held of the legislative intent as is evident from Section 138 of the Act that, if for the dishonoured cheque dema....
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....ce. Accused need not disprove the prosecution case in its entirety. Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the Court in support of the defence that the court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the "prudent man". 11-C. There are presumptions (besides the general presumptions under the Indian Evidence Act) specially provided in respect of a negotiable instrument under Section 118 clauses (a) to (g) of the Act and for the dishonour of cheque relating to criminal liability under 139 and apparently a legal fiction though strictly not as per the Explanation to Section 138-of the Act, for the purpose of this section, "debt or other liability" means a legally enforceable debt or other liability. Section 118: Presumptions as to negotiable instruments - Until the contrary is proved, the following presumptions shall be made: Clause (a) of consideration - that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, nego....
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.... Krishna Janardhan Bhat (supra) by distinguishing at para-14 saying the observation in KRISHNA JANARDHAN BHAT (supra) of the presumption mandated by Section 139 does not indeed include the existence of a legally enforceable debt or liability is not correct, though in other respects correctness of the decision does not in any way cause doubted; by also referring to Hiten P. Dalai v. Bratindranath Banerjee AIR 2001 SC 3897 holding at paras-22 and 23 therein of the obligation on the part of the Court to raise the presumption under 138, 139 and 118 of the N.I. Act, in every case where the factual basis for raising the presumption has been established since introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused, as a presumption of law distinguished from a presumption of fact as part of rules of evidence and no way in conflict with presumption of innocence and the proof by prosecution against the accused beyond reasonable doubt, but for saying to rebut the accused can discharge the burden showing reasonable probability of non-existence of the presumption of fact and to that proposition, the earlier expression in Bhar....
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....ailed to reply to the statutory notice under Section 138 of the Act leads to the inference that there was merit in the complainant's version. It was also held by this court way back in Chapala Hanumaiah v. Kavuri Venkateshwarlu 1971 (i) An.W.R. 65 that having received and acknowledged the statutory legal notice after dishonour of cheque, non-giving of reply to said legal notice, improbablises the defence version, as any prudent person under the said circumstances should have, but for no defence to reply. 11-E. If at all, there is any payment including part payment or adjustment to be considered for deduction while enforcing the amount covered by the dishonoured cheque for its consequences, the burden is on the accused as per settled law to prove said discharge or adjustment. In this regard, in M/s. Thekkan and Company v. M. Anitha 2004 Crl.L.J. 58, it was held by the Kerala High Court that nothing precludes the Court under Section 138 of the Act for taking into account prior payments made before the presentation of the cheque or before receipt of notice in deciding whether the amount due under the cheque has been fully paid, if not for continuing the prosecution. In an....
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....show on which date it was returned to the sender. The endorsement made on 24.09.2005 shows return to sender basing on the earlier endorsement as the addressee absent. 14. Learned counsel for the appellant has also placed reliance on a decision of Three Judges Bench of Apex Court in C.C. Alavi Haji v. Palapetty Muhammed and another (2007) 6 SCC 555, regarding deemed service of notice. 15. From the above proposition of law, there is a deemed service. Here, the question arises is what is the date of deemed service, is it 19.09.2005 or after end of the seven days of waiting for return. In the above Rule 74 of the Postal Rules what is required is to deposit for seven days and return thereafter to the sender. That is different from the deemed service for purpose of considering 15 days time under Section 138 N.I. Act. 16. Learned counsel for the appellant placed reliance upon an expression of Kerala High Court in Gopalakrishnan Lekshmanan v. Noor-jahan Abdul Azeez and Another 2012 CRI.L.J.93. It has to be understood that the date of knowledge of receipt of said notice as date of service. In fact that is not the law from the settled expressions particularly of the Three Judges Ben....
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.... Bihar and another (Crl.R.P. No. 259 of 2007) at para No. 5 it was observed that it is proved that legal notice sent to accused by registered post that was returned back undelivered, was also proved by its final. At para No. 11 it was observed that endorsement refer to D.Vinod Shivappa's expression in para No. 15, which reads as follows: "endorsement made on the envelop that the premises has been found locked or that the addressee was not available at the time when postman went for delivery of the letter. It may be that the address is correct and even the addressee is available but a wrong endorsement is manipulated by the addressee. In such a case if the facts are proved, it may amount to refusal of the notice." 18. At para No. 12 it was observed that complainant stated notice returned due to non-receipt and no where stated accused had deliberately avoided and no witness examined like a postman to prove the fact and held that complainant could not prove deemed service. 19. In fact, this decision is also not an authority as to seven days waiting required or not. So far as the present facts are concerned, as per the expression in C.C. Alavi Haji's case (supra)....