TaxTMI 
TaxTMI 
2024 (1) TMI 3
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....s with the accused for 7-8 years. The accused no. 1 is a sole proprietorship firm in the name & style of M/s Veer Daily Needs and Karyana Store and accused no. 2 is the proprietor of the firm. The accused no. 2 approached the complainant in March 2009 for a loan of Rs. 3,10,000/-. The complainant agreed and advanced an amount of Rs. 3,10,000/- in March 2009 after arranging it from his relatives and friends. Accused No.2 undertook to repay the amount by the end of October 2009. Accused no.2 issued a post-dated cheque of Rs. 3,10,000/- in favour of the complainant drawn on State Bank of India, Boileauganj in the discharge of his legal liability. The complainant presented the cheque before Punjab National Bank, Totu, Shimla, who sent it to the State Bank of India for realization; however, the cheque was dishonoured with the endorsement 'account closed'. The complainant served a notice upon the accused by means of a registered A.D. cover and certificate of posting. The notice was duly served upon the accused. The accused failed to make the payment despite the receipt of the notice; hence, the complaint was filed to take action against the accused. 3. Learned Trial Court found suffic....
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....arned Trial Court be set aside. 9. The complainant also filed an application under Section 311 of Cr.P.C. for recalling himself for further examination. It was asserted that the learned Trial Court held that the income of the applicant ranged between Rs. 1,70,000/- to Rs. 2,50,000/- and he could not have advanced a sum of Rs. 3,10,000/- to the accused. The complaint was dismissed based on this reasoning. The complainant wants to prove the Income Tax Return filed by him and examine himself to prove these returns. Hence, it was prayed that the present application be allowed and the complainant be permitted to be recalled. 10. The application is opposed by filing a reply taking preliminary objections regarding lack of maintainability, the complainant being estopped from filing the application by his act, conduct and acquiescence, and the application having been filed to fill up the lacuna. The contents of the application were denied on merits. It was asserted that the complainant cleverly placed on record the copy of the Income Tax Return in which an amount of Rs. 3,10,000/- was stated to have been advanced by him to the accused. This is contrary to the statement in the crossexa....
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....The reason is that an order of acquittal adds up to the presumption of innocence in favour of the accused. Thus, the Appellate Court has to be relatively slow in reversing the order of the Trial Court rendering acquittal. Therefore, the presumption in favour of the accused does not get weakened but only strengthened. Such a double presumption that enures in favour of the accused has to be disturbed only by thorough scrutiny on the accepted legal parameters." 16. This position was reiterated in Siju Kurian versus State of Karnataka 2023 online SCC 429, wherein it was held:- "15. One of the main contentions raised by the learned counsel appearing for the appellant is to the effect that the High Court ought not to have interdicted with the judgment of the acquittal passed by the Trial Court and only in the event of the judgment of the Trial court was riddled with perversity and the view taken by the Trial Court was not a possible view, same could have been reversed by relying upon the judgment of this Court in case of Murugesan V. State through the Inspector of police(2012) 10 SCC 383 whereunder it came to be held as follows: "33. The expressions "erroneous", "wro....
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....he evidence and conclusions drawn by the trial court but only in a case when the judgment of the trial court is stated to be perverse. The word "perverse" in terms as understood in law has been defined to mean "against the weight of evidence". We have to see accordingly as to whether the judgment of the trial court which has been found perverse by the High Court was in fact so. 17. The Appellate Court may reverse the order of acquittal in the exercise of its powers and there is no indication in the Code of any limitation or restriction having been placed on the High Court in the exercise of its power as an Appellate court. No distinction can be drawn as regards the power of the High Court in dealing with an appeal, between an appeal from an order of acquittal and an appeal from a conviction. The Code of Criminal Procedure does not place any fetter on the exercise of the power to review at large the evidence upon which the order of acquittal was founded and to conclude that upon that evidence the order of acquittal should be reversed. 18. In the case of Sheo Swarup v. King Emperor AIR 1934 PC 227, it has been held by the Privy Council as under: But in exercising th....
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.... further reinforced, reaffirmed and strengthened by the trial court. (5) If two reasonable conclusions 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." 17. The present appeal has to be adjudicated in the light of the judgments of the Hon'ble Supreme Court. 18. Learned Trial Court heavily relied upon the report of the Handwriting Expert issued by Scientist 'B', CFSL, Government of India. It was submitted that this document was not per se admissible and it was essential to examine the Expert, who had issued the report. This submission has to be accepted as correct. It was laid down by this Court in State of Himachal Pradesh versus Anoop Kumar 2008 (1) ShimLC 71 that the opinion of a Handwriting Expert is required to be proved in accordance with the law. It was observed:- "The allegations against Anoop Kumar are that he forged G.R. Ext.PW-18/A. In support of forgery allegedly committed by Anoop Kumar, the prosecution has relied on handwriting expert report Ext. PW-19/A. This report was produced by P.W.-19 Garib Dass, a Retired Inspector. The prosecution did not....
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....e acknowledgement. He had filed the complaint on 11.03.2010, hence, the Income Tax Return came into existence after filing of the complaint during its pendency. 22. Further, these documents were available with the complainant during the Trial. He has not shown any reason as to why he had not produced these documents before the learned Trial Court. The application has been filed under Section 311 of Cr.P.C. however, the application is in the nature of additional evidence to prove the additional record mainly the Income Tax Return and will properly fall within the definition of Section 391 of Cr.P.C. 23. It was laid down by the Hon'ble Supreme Court in Ashok Tshering Bhutia Versus State of Sikkim (2011) 4 SCC 402 that the power to receive additional evidence must be exercised sparingly in those cases where the Court is satisfied that additional evidence would serve the interest of justice. It was observed: "28. Additional evidence at the appellate stage is permissible, in case of a failure of justice. However, such power must be exercised sparingly and only in exceptionally suitable cases where the court is satisfied that directing additional evidence would serve t....
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.... justice in an even-handed manner without fear of criticism from the quarters which view white-collar crimes with a permissive eye unmindful of the damage done to the national economy and national interest....." 31. In Rambhau (supra), a larger Bench of this Court held as under: "Incidentally, Section 391 forms an exception to the general rule that an Appeal must be decided on the evidence which was before the Trial Court and the powers being an exception shall always have to be exercised with caution and circumspection so as to meet the ends of justice. Be it noted further that the doctrine of finality of judicial proceedings does not stand annulled or affected in any way by reason of the exercise of power under Section 391 since the same avoids a de novo trial. It is not to fill up the lacuna but to subserve the ends of justice. Needless to record that on an analysis of the Civil Procedure Code, Section 391 is thus akin to Order 41, Rule 27 of the C.P. Code." 32. In view of the above, the law on the point can be summarised to the effect that additional evidence can be taken at the appellate stage in exceptional circumstances, to remove an irregularity, ....
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....ising of the presumption had been established. But this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary as is clear from the use of the phrase 'unless the contrary is proved'. 36. The Court will necessarily presume that the cheque had been issued towards the discharge of a legally enforceable debt/liability in two circumstances. Firstly, when the drawer of the cheque admits issuance/execution of the cheque and secondly, in the event where the complainant proves that the cheque was issued/executed in his favour by the drawer. The circumstances set out above form the fact(s) which bring about the activation of the presumptive clause. [Bharat Barrel Vs. Amin Chand] [(1999) 3 SCC 35] 37. Recently, this Court has gone to the extent of holding that presumption takes effect even in a situation where the accused contends that 'a blank cheque leaf was voluntarily signed and handed over by him to the complainant. [Bir Singh v. Mukesh Kumar[(2019) 4 SCC 197]]. Therefore, the mere admission of the drawer's signature, without admitting the execution of the entire contents in the cheque, is now sufficient to ....
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.... 42. In other words, the accused is left with two options. The first option-of proving that the debt/liability does not exist-is to lead defence evidence and conclusively establish with certainty that the cheque was not issued in discharge of a debt/liability. The second option is to prove the non-existence of debt/liability by a preponderance of probabilities by referring to the particular circumstances of the case. The preponderance of probability in favour of the accused's case may be even fifty-one to forty-nine and arising out of the entire circumstances of the case, which includes: the complainant's version in the original complaint, the case in the legal/demand notice, complainant's case at the trial, as also the plea of the accused in the reply notice, his 313 statement or at the trial as to the circumstances under which the promissory note/cheque was executed. All of them can raise a preponderance of probabilities justifying a finding that there was 'no debt/liability'. [Kumar Exports and Sharma Carpets, (2009) 2 SCC 513] 43. The nature of evidence required to shift the evidential burden need not necessarily be direct evidence i.e., oral or document....
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....in Tedhi Singh Versus Narayan Dass Mahant (2022) 6 SCC 735 as under:- "7. It is true that this is a case under Section 138 of the Negotiable Instruments Act. Section 139 of the N.I. Act provides that Court shall presume 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. This presumption, however, is expressly made subject to the position being proved to the contrary. In other words, it is open to the accused to establish that there is no consideration received. It is in the context of this provision that the theory of 'probable defence' has grown. In an earlier judgment, in fact, which has also been adverted to in Basalingappa (supra), this Court notes that Section 139 of the N.I. Act is an example of reverse onus [see (2010) 11 SCC 441). It is also true that this Court has found that the accused is not expected to discharge an unduly high standard of proof. It is accordingly that the principle has developed that all which the accused needs to establish is a probable defence. As to whether a probable defence has been established is a matter to be decided on the....
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....e cheque was issued in discharge of debt or liability. The question to be looked into is as to whether any probable defence was raised by the accused. In cross-examination of the PW1, when the specific question was put that a cheque was issued in relation to a loan of Rs. 25,000/-taken by the accused, the PW1 said that he does not remember. PW1 in his evidence admitted that he retired in 1997 on which date he received a monetary benefit of Rs. 8 lakhs, which was encashed by the complainant. It was also brought in the evidence that in the year 2010, the complainant entered into a sale agreement for which he paid an amount of Rs. 4,50,000/- to Balana Gouda towards sale consideration. Payment of Rs. 4,50,000/-being admitted in the year 2010 and further payment of loan of Rs. 50,000/-with regard to which complaint No.119 of 2012 was filed by the complainant, copy of which complaint was also filed as Ex.D2, there was a burden on the complainant to prove his financial capacity. In the years 2010-2011, as per the own case of the complainant, he made a payment of Rs. 18 lakhs. During his cross-examination, when the financial capacity to pay Rs. 6 lakhs to the accused was questioned, there ....
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.... Giving of a cheque on 27.02.2012, which was deposited on 01.03.2012 is not compatible with the case of the complainant when we read the complaint submitted by the complainant, especially Para 1 of the complaint, which is extracted as below: "1. The accused is a very good friend of the complainant. The accused requested the Complainant a hand loan to meet out the urgent and family necessary sum of 6,00,000/-(Rupees Six Lakh) and on account of long-standing friendship and knowing the difficulties, which is being faced by the accused the complainant agreed to lend hand loan to meet out the financial difficulties of the accused and accordingly the Complainant lend hand loan Rs. 6,00,000/-(Rupees Six Lakh) dated 27.02.2012 in favour of the Complainant stating that on its presentation it will be honoured. But to the surprise of the Complainant on presentation of the same for collection through his Bank, the Cheque was returned by the Bank with an endorsement "Funds Insufficient" on 01-03- 2012." 29. Thus, there is a contradiction in what was initially stated by the complainant in the complaint and in his examination-in-chief regarding the date on which the loan was giv....