B.S. Somashekhar Shetty vs Smt. Lalitha

V. Jagannathan, J.—The revision Petitioner suffered a judgment of conviction before the trial court and was convicted for the offence punishable u/s 138 of the Negotiable Instruments Act and was sentenced to undergo one year simple imprisonment and to pay a fine of Rs. 12,25,000/-, out of which Rs. 12,15,000/- was ordered to be paid to the complainant and the balance to the State Government. The said judgment of conviction and sentence was assailed by the Petitioner before the lower appellate court in Crl.A. No. 74/2007 and the learned judge of the lower appellate court dismissed the Petitioner''s appeal by confirming the judgment of the trial court. This, in short, is the background of this revision petition.

The case of the Respondent-complainant, in short, was that, the revision Petitioner borrowed a sum of Rs. 12,00,000/- from her to start a business and the said amount was paid on 11.7.2005 by the complainant and to discharge the said amount, the revision Petitioner issued three cheques dated 10.9.2005, 10.10.2005 and 25.11.2005 for Rs. 3,00,000/-, Rs. 3,00,000/- and Rs. 6,00,000/- respectively, and these cheques, on being presented by the complainant, were returned with an endorsement "insufficient funds" and, therefore, the complainant, after notice to the revision Petitioner and not getting positive response, had filed a complaint before the trial court, which ultimately led to the charge being framed against the revision Petitioner which was denied by him and after the evidence was let in by the parties i.e., P. Ws. 1 to 4 being examined on behalf of the complainant and 12 documents being marked on her side and D. Ws. 1 to 3 being examined and 13 documents being marked on the side of the revision Petitioner.

The learned trial judge ultimately accepted the case of the complainant and as the cheques were found to bear the signatures of the revision Petitioner, ultimately, the revision Petitioner was convicted and sentenced as mentioned earlier.

I have heard learned Counsel Shri K.V. Narasimhan for the revision Petitioner and none appeared for the Respondent despite the court waiting for considerable length of time. Even in the course of the arguments canvassed by the learned Counsel for the revision Petitioner, there was no sign of appearance of the Respondent''s counsel and, therefore, the arguments of the Respondent''s counsel is taken as nil.

5 The learned Counsel for the revision Petitioner, at the out set, argued that, though the cheques in question viz., Exs.P-1 to P-3, bear the signature of the revision petition which is not in dispute, the entire case of the Respondent-complainant is an highly improbable one and the Petitioner has shown from the evidence on record that the presumption in favour of the complainant has been rebutted and, therefore, both the courts have committed serious error in not taking note of the rebuttal evidence which was brought to the notice of the court from the evidence on record. Despite this, the courts below proceeded only on the footing that the cheques Exs.P-1 to P-3 contained the signatures of the Petitioner was not in dispute and, therefore, on that score alone, the Petitioner was convicted and sentenced.

Therefore, the learned Counsel for the revision Petitioner'' took this Court through the evidence on record and particularly to the examination-in-chief and cross-examination portion of P.W. 1 complainant and to the evidence of the Petitioner himself to point out that the probability of the complainant having the capacity to advance Rs. 12,00,000/- to the Petitioner is rendered impossible from the very evidence of the complainant herself. In this connection, he argued that the complainant has admitted that she has no source of income and she does not have any bank balance and she took the money from her sister. To show that the money was given to her by her sister, no evidence was placed by the complainant. It was further submitted that the complainant''s husband, who also has filed another case against the Petitioner, was working as a writer in the coffee estate and was getting salary of Rs. 2,500/- and the balance which the husband of the complainant had in his account on the day of his evidence was Rs. 1,500/- and not more than that. Therefore, the evidence of the complainant and her husband and the defence taken by the Petitioner would go to show that the complainant had misused five cheques, which have been given as security by the Petitioner in respect of a similar transaction when the Petitioner had taken Rs. 5,00,000/- loan from the ''complainant and her husband and in turn had given five cheques and, though the Petitioner had repaid the amount with interest totaling in all Rs. 8,00,000/-, the cheques were not turned by the husband, but they were misused to file the present case.

Therefore, relying on the Apex Court decision in the case of Rangappa v. Sri Mohan, reported in 2010 (4) CTC 118, as well as the subsequent judgment of the Apex court in the case of P. Gnanambigai v. S. Krishnasami and also on the decision of this Court in Criminal Appeal No. 1371/2007, the learned Counsel for the revision Petitioner argued that both the courts below did not take note of the rebuttal evidence on record and therefore, the Petitioner be acquitted of the offence by allowing this revision petition.

Having thus heard the learned Counsel for the revision Petitioner and after going through the entire material on record, I find enough substance in the contentions put forward by the Petitioner''s counsel for the following reasons.

First of all, it is the case of the Respondent that she gave Rs. 12,00,000/- to the Petitioner on 11.7.2005. To show that the Respondent had the capacity to advance that much of amount, there is no evidence forthcoming from the side of the Respondent. In the course of her evidence, who is examined as P.W. 1, the Respondent has stated that, in connection with the business of pepper and opening of bakery etc, the Petitioner had taken Rs. 12,00,000/- from the complainant and had given three cheques towards the said amount and asked the complainant to present them to the bank after 25.12.2005. In order to show that she had capacity to advance so much of amount and to substantiate that, P.W. 1 did not place any evidence. However, in the course of her cross-examination, it has been brought out by the accused that the complainant was residing behind P.W.D. quarters at Sakaleshapura for about three years and prior to that, she was residing at Raghavendranagara. Secondly, it has been brought out that the complainant''s husband was working as a writer in the coffee estate of one P.F. Saldanha and she has admitted that she does not have any property of her own and neither the complainant nor her husband are the income tax assesses and they have not paid any income tax also.

In the course of her cross-examination, P.W. 1 has further stated that she gave the amount of Rs. 12,00,000/- to the accused in installments and she took the amount from her sisters to give it to the accused. It is also in her evidence that she does not have any information or knowledge about the banking transactions or issuing cheques and she cannot read.

The evidence of the revision Petitioner, on the other hand, was that he had taken Rs. 5,00,000/- loan from the complainant''s husband and as security, he had given five cheques and he had cleared the loan in the month of May 2005 by paying Rs. 3,00,000/- with interest and in all Rs. 8,00,000/- had been paid by him and when he asked life complainant''s husband to give back the cheques, the complainant''s husband refused to give the said cheques.

Thus, a careful examination of the evidence of P.W. 1 complainant and that of the accused-Petitioner would go to show that, to show that the complainant had the capacity to advance Rs. 12,00,000/-, no convincing evidence was placed by the complainant. The sisters of the complainant were not examined nor any document was produced to show that the complainant had received the amount from her sisters and then gave it to the Petitioner. The complainant says in one breath that she gave Rs. 12,00,000/- on 11.7.2005 to the accused, but in the cross-examination, she says that she gave the amount in installments. She does not say as to in how many installments she gave the amount and what was the amount given during each installment. Being a person not paying the income tax and not having any source of income nor any property of her own, it is very difficult to accept the complainant''s version that she advanced Rs. 12,00,000/- to the Petitioner.

The evidence of the complainant herself has revealed that the presumption in her favour stood rebutted and the accused, therefore, need not lead any evidence to rebut the presumption. The version of the Petitioner also gives rise to take the view that the presumption stood rebutted because, it is the specific case of the revision Petitioner that he had taken Rs. 5,00,000/- from the complainant''s husband and as security he had given live cheques and after repaying the loan amount with interest, by paying Rs. 8,00,000/-, he sought for the cheques to be returned to him, but the complainant''s husband did not return the cheques. Therefore, the argument that the complainant and her husband had misused the cheques given as security also appears to be a probable one.

The Apex Court, in the case of P. Gnanambigai v. S. Krishnasamy, referred, to above, has held thus at paragraph-10:

The well settled legal position, which is reiterated in the larger bench judgment of Supreme Court reported in 2010 (4) CTC 118 in Rangappa v. Sri Mohan is that when an accused has to rebut the presumption u/s 139 the standard of proof for doing so, is that of preponderance of probabilities and if the accused is able to raise a probable defence which creates doubt about the existence of legally enforceable debt or liability, the prosecution can fail. It is further observed in the same judgment that the accused can rely on the materials submitted by the complainant in order to raise such a defence. It is also observed by the Supreme Court in the earlier judgment reported in Krishna Janardhan Bhat Vs. Dattatraya G. Hegde, that the court must be on guard to see that merely on the application of presumption as contemplated u/s 139 of the N.I. Act, the same may not lead to injustice or mistaken conviction and the accused for discharging the burden of proof placed upon him under the statute need not examine himself and he can discharge his burden on the basis of the materials already brought on records and the accused has a constitutional right to maintain silence and standard of proof on the part of the accused and that of the prosecution in a criminal case is different. It is also observed by the Supreme Court that the presumption of innocence as a human right and the doctrine of Reserve Burden introduced u/s 139 should be delicately balanced and such balancing acts, indisputably would largely depend upon the factual matrix of each case, the materials brought on record and having regard to the legal principles governing the same. The test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused cannot be expected to discharge an unduly high standard of proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden.

This Court, in the decision rendered in Criminal Appeal No. 1371/2007, disposed of on 13.1.2010, has also observed that the presumption u/s 139 of the N.I. Act being a rebuttable presumption, it is not necessary for the accused to prove his defence beyond reasonable doubt by stepping into the witness box but, he can show that the presumption is rebutted by referring to the entire material on record. It is on this reasoning and after relying on the Apex court decision reported in AIR 2008 SCW 738, that the learned Single Judge of this Court in the above mentioned criminal appeal has observed that it is highly unnatural that the complainant would have lent Rs. 50,000/- by borrowing the amount from others and the court went on to hold that the accused had no capacity to pay Rs. 50,000/-nor he had any savings. Consequently, the appeal preferred by the complainant was dismissed.

The present ease also requires to be treated on the very same lines as earlier I have mentioned that the complainant has not been able to place any iota of evidence to place that she had the capacity to pay Rs. 12,00,000/- to the Petitioner. No document in proof of the income of the complainant was forthcoming and the very admission made by the complainant in her evidence shows that she does not have any property nor she is an income tax Assessee and no document is produced to show that she took loan from her sisters. Under these circumstances, both the courts below committed error in not taking note of the rebuttable presumption that was made available on record and, as such, merely on the basis of issuance of cheques by the Petitioner, the trial court could not have convicted him and the lower appellate court also committed the similar error in not noticing the law bearing on the point and that the presumption stood rebutted from the very evidence of the complainant. The court need not have to insist on any positive evidence from the Petitioner.

For the above reasons, the revision petition is allowed and the judgments of the courts below stand set aside. The amount, if any, deposited by the revision Petitioner be refunded to him.

ORDER ON BEING SPOKEN TO

09.06.2011

Heard the learned Counsel for the Respondent in respect of the request made to take up the matter for being spoken to.

The circumstance under which the matter is being heard today is, this Court had heard the arguments of the learned Counsel Sri. K.V. Narasimhan for the Petitioner on 06.06.2011 and though the judgment had been dictated, before the same could be signed, a request was made by the Respondent''s Counsel for taking up the matter for being spoken to.

Submission made by the learned Counsel for the Respondent is that, this Court may take note of the two decisions referred to by him in the memo riled today, namely, AIR 2010 SCW 2946 and AIR 2001 SCW 1847. Relying on the aforesaid decisions, submission made is that, Exs.P6 & P12 which are the reply notice given by the accused goes to show that though the accused had taken up the stand that he had repaid the amount taken from the complainant, yet no date was mentioned in the two legal notices and therefore, when the accused has not been able to establish his defence by way of rebuttal evidence, the explanation offered by the accused therefore cannot be taken into consideration. As such, the judgments of the courts below require no interference.

On the other hand, Sri. K.V. Narasimhan, learned Counsel for the Petitioner reiterated the arguments advanced by him when the matter was heard on 06.06.2011 and submitted that this Court had taken note of the decisions referred to by the Respondent''s Counsel and also took note of the acknowledgment given by the complainant himself as per Ex.D12(a) and therefore, no ground is made out for this Court to alter the view taken when the judgment was dictated on 06.06.2011.

Having thus heard both sides, in my view, the decision taken on 06.06.2011 does not call for any modification or alteration.

As far as this case is concerned, the complainant was unable to show as to the source from which she was able to secure Rs. 12 lakhs and it is very strange that the complainant took the said amount from her sisters and given to the accused. The complainant has not examined any witness to support the complainant in this regard and even in this case also, the complainant has admitted that she does not have any property of her own and she was not an income tax Assessee nor her husband is an Assessee to the income tax and though, she has admitted that she gave the amount in installment, no evidence is forthcoming as to when and what was the amount when the evidence was adduced by her and therefore, this Court disbelieved the complainant''s case. As regards her capacity to advance Rs. 12 lakhs to the accused, apart from this, this Court also observed that when the amount said to have been advanced by the complainant Lalitha, wife of the other complainant Chengappa, itself had not been paid by the accused. The possibility of Lalitha''s husband also advancing Rs. 4 lakhs to the accused appeal''s to be a remote in the guilty. In other words, the complainant was not able to place any convincing evidence to show that she had the capacity to advance Rs. 12 lakhs to the accused.

For the above said reasons, the view taken earlier therefore does not require any modification.