TaxTMI 
TaxTMI 
2024 (10) TMI 1645
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....parate Judgments and Orders dated 31.10.2019 passed by the VII Additional Sessions Judge, City Civil Court, Chennai (hereinafter referred to as the 'First Appellate Court') in Crl. A. Nos.380384 of 2017, were upheld. BRIEF FACTS: 3. The sole respondent is the complainant. The petitioner no.2 is the proprietor of petitioner no.1 and both are arrayed as accused. It was alleged that the petitioner no.2 was in the business of Cinema Production and for his urgent business needs, he had approached the complainant and borrowed a total sum of Rs.41,28,000/- (Rupees Forty-One Lakhs Twenty-Eight Thousand) in five instalments as a hand loan on 29.08.2015 and promised to repay the same on demand with interest at the rate of 2% per month. Separate Promissory Notes dated 29.08.2015 were executed for each of the instalments in favour of the complainant. 4. In order to discharge the liability of Rs.42,08,000/- (Rupees FortyTwo Lakhs Eight Thousand), a total of five cheques were issued by the accused, which on being presented by the complainant, were returned with the endorsement 'funds insufficient'. Statutory Notice was issued by the complainant pursuant to which he lodged five complaint....
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....n and not for any other purpose by placing the statement of accounts and/or Income Tax Returns. Hence, the complaint would not attract Section 138 of the Act as the accused has rebutted the presumption under Sections 118 and 139 of the Act by probable defence. This defence has been established by cross-examining PW1/the General Power of Attorney-holder of the complainant. Accordingly, the accused had shifted the burden on the complainant. Hence, the statutory presumption under Section 139 of the Act would not continue and it was for the complainant to discharge the onus by bringing on record evidence/material to show that the amount(s) given is/are for a legally enforceable debt. Moreover, the complainant failed to assail the defence of the accused. On these grounds, learned counsel for the petitioners urged the Court to issue notice and thereafter, admit and allow the appeals. ANALYSIS, REASONING AND CONCLUSION: 8. From the order impugned, it is clear that though the contention of the petitioners was that the said amounts were given for producing a film and were not by way of return of any loan taken, which may have been a probable defence for the petitioners in the case, bu....
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....hen come to a conclusion whether in the given case, the accused has shown that the case of the complainant is in peril for the reason that the accused has established a probable defence.' (emphasis supplied) 9. The High Court has also rightly noted that the petitioners have not denied receipt of the sum of Rs.41,28,000/- (Rupees Forty-One Lakhs Twenty-Eight Thousand) but have taken the defence that it was given in the course of jointly producing a film with the complainant. Even then, the liability has to be discharged by the person(s) concerned and that would be a legally enforceable debt repayable, under the purview of Section 138 of the Act. 10. Moreover, as per the defence proffered by the petitioners themselves, the money was given to the accused in the course of producing a film jointly by the complainant. The accused urge that since the film failed, the cheques and receipts given by the accused were misused by the complainant. Thus, arguendo, if the same is correct, and the accused and respondent-complainant were indeed jointly producing a film, no reason/occasion to issue the cheques and receipts to the complainant is forthcoming, inasmuch as, if the amount(s....
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....on 139 and Section 118 and are hence, not repeated-reference to one can be taken as reference to another] 34. Section 139 of the NI Act, which takes the form of a "shall presume" clause is illustrative of a presumption of law. Because Section 139 requires that the Court "shall presume" the fact stated therein, it is obligatory on the Court to raise this presumption in every case where the factual basis for the raising 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". 35. The Court will necessarily presume that the cheque had been issued towards 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 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 & Drum Mfg. Co. v. Amin Chand Payrelal [Bharat Barrel & D....
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....salingappa v. Mudibasappa [Basalingappa v. Mudibas appa, (2019) 5 SCC 418: (2019) 2 SCC (Cri) 571: AIR 2019 SC 1983]; see also Kumar Exports v. Sharma Carpets [Kumar Exports v. Sharma Carpets, (2009) 2 SCC 513: (2009) 1 SCC (Civ) 629: (2009) 1 SCC (Cri) 823] ] 41. 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 Section 313 CrPC statement or at the trial as to the circumstances under which the promissory note/cheque was executed. All of them can raise a ....
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.... has to consider the same and the burden of proof loses all its importance. [Basalingappa v. Mudibasappa [Basalingappa v. Mudibas appa, (2019) 5 SCC 418: (2019) 2 SCC (Cri) 571: AIR 2019 SC 1983]; see also, Rangappa v. Sri Mohan [Rangappa v. Sri Mohan, (2010) 11 SCC 441: (2010) 4 SCC (Civ) 477: (2011) 1 SCC (Cri) 184: AIR 2010 SC 1898]]' (emphasis supplied) 13. For reasons aforesaid, we do not find any ground to interfere in the order impugned and accordingly, the petition(s) shall stand dismissed. We refuse special leave, being cognizant of Rafiq v State of Uttar Pradesh, (1980) 4 SCC 262: '3. Concurrent findings of fact ordinarily acquire a deterrent sanctity and tentative finality when challenged in this Court and we rarely invoke the special jurisdiction under Article 136 of the Constitution which is meant mainly to correct manifest injustice or errors of law of great moment. ...' (emphasis supplied) 14. However, before parting, the Court would clarify that though there are separate judgments and orders of the Trial Court, in each case, six months' simple imprisonment and direction to pay the cheque amount as the compensation has been awarded; t....
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....the borrowing company is different no matter the appellant before us is the promoter/Director of the said other companies also. Similarly, we see no reason to direct running of the sentence concurrently in the case filed by State Bank of Patiala against M/s Sabhyata Plastics and M/s Rahul Plastics which transaction is also independent of any loan or financial assistance between the State Financial Corporation and the borrowing companies. We make it clear that the direction regarding concurrent running of sentence shall be limited to the substantive sentence only. The sentence which the appellant has been directed to undergo in default of payment of fine/compensation shall not be affected by this direction. We do so because the provisions of Section 427 CrPC do not, in our opinion, permit a direction for the concurrent running of the substantive sentences with sentences awarded in default of payment of fine/compensation.' (emphasis supplied) III. O M Cherian v State of Kerala, (2015) 2 SCC 501 [3-Judge Bench] '18. While referring the matter to a larger Bench, the Bench observed that in Mohd. Akhtar Hussain case [Mohd. Akhtar Hussain v. Collector of Customs, (198....
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....o run concurrently, having regard to the nature of offences and attendant aggravating or mitigating circumstances. We do not find any reason to hold that normal rule is to order the sentence to be consecutive and exception is to make the sentences concurrent. Of course, if the court does not order the sentence to be concurrent, one sentence may run after the other, in such order as the court may direct. We also do not find any conflict in the earlier judgment in Mohd. Akhtar Hussain [Mohd. Akhtar Hussain v. Collector of Customs, (1988) 4 SCC 183: 1988 SCC (Cri) 921] and Section 31 CrPC.' (emphasis supplied) 15. Exemption from surrendering granted earlier vide Order dated 03.05.2024 in favour of petitioner no.2 will cease to operate. The petitioner no. 2 is hereby directed to surrender within three weeks from the date of communication of this Judgment to serve the remaining period of sentence. Registry shall intimate the petitioners and their AOR forthwith. 16. Pending IA(s), if any, stand closed. FOOTNOTE :- 1 '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 ban....