Deniael Regmi vs Shri Haladhar Kalita & Anr.

This criminal revision petition is filed, under Section 397, read with Section 401 of the Code of Criminal Procedure, challenging the legality,

propriety and correctness of the judgment and order, dated 29-06-2005, passed by the learned Sub-Divisional Judicial Magistrate No. I,

Kamrup, (M), Guwahati, in CR Case No. 4385C/2003, convicting the accused-petitioner under Section 138 of the Negotiable Instrument Act (in

short, ''NI Act'') and sentencing him, to suffer simple imprisonment for 1 year and to pay a compensation of double the cheque amount as well as

the judgment and order, dated 18-03-2008, passed by the learned Additional Sessions Judge No. 1 (FTC), Kamrup, (M), Guwahati, in Criminal

Appeal No. 70 of 2005, dismissing the appeal and upholding the judgment and order, rendered by the learned trial Court.

I have perused the revision petition as well as the annexures furnished thereto including the impugned judgments. I have also perused the records

of the learned trial Court.

I have heard Mr. Z Alam, learned counsel for the revision petitioner and Mr. B Sarma, learned Additional Public Prosecutor, Assam, for

respondent No. 1. Also heard Mr. GP Bhowmik, learned counsel for the private respondent No. 2.

The facts of the case is that a cheque, dated 23-08-2003, for an amount of Rs. 2,60,000/- was issued by the accused-petitioner in favour of the

complainant-respondent in discharge of his liability. The said cheque was deposited by the complainant-respondent in Central Bank of India,

Evening Branch of Chandmari, Guwahati. But on 26-08-2003, the banker of the complainant-respondent returned the cheque as the drawer had

issued ''stop payment instruction'' to his banker in respect of the aforesaid cheque. The matter was informed to the accused-petitioner by the

complainant-respondent over telephone, and subsequently, on 13-09-2003, issued a written notice to him asking him to pay the money within 15

days from the date of receipt of the notice. But the accused-petitioner did not respond the said notice.

Accordingly, the complainant-respondent filed a complaint case, being CR Case No. 4385/2003, in the Court of learned Sub-Divisional Judicial

Magistrate No. I, Kamrup, (M), Guwahati. The accused-petitioner appeared in the learned trial Court and pleaded not guilty. The learned trial

Court commenced the trial after exhausting all the required legal formalities.

The complainant-respondent examined 3 witnesses, who were, in turn, cross-examined by the defence. In his statement under Section 313 of

the Cr.P.C., the accused-petitioner admitted the issuance of cheque, but denied that the said cheque was issued in discharge of any debt/liability.

The case of the accused-petitioner is that the complainant-respondent, on the strength of a power of attorney, sold a plot of land through the

accused-petitioner and since the land, in question, was entangled in a litigation, the accused-petitioner was compelled to issue ''stop payment

instruction'' in respect of the cheque.

The accused-petitioner was convicted and sentenced by the learned trial Court, as aforesaid, after completion of the trial vide the judgment

referred to above. In appeal, the learned Additional Sessions Judge No. 1 (FTC) upheld the judgment of the learned trial Court.

I have heard the arguments canvassed before this Court by learned counsel for the parties. Mr. B Sarma, learned Additional Public Prosecutor

did not make any submission in view of the fact that the State is only a formal party in this case.

The fact that the cheque was issued by the present accused-petitioner and was bounced is an admitted fact. The complainant-respondent

produced the cheque involved in this case as Ext.1, for Rs. 2,60,000/-, which was proved, in original, and Ext. 2 is the counterfoil of the deposit

slip by which the complainant-respondent deposited the same for collection. Vide Ext. 3, the banker of the complainant-respondent intimated the

banker of accused-petitioner about non-payment of cheque amount. He has also proved the statutory notice, issued to the accused-petitioner; vide

Ext.5 and Ext.6, which are the copies of postal receipts, proved, in original. Ext. 7 and Ext. 8 are the copies of Acknowledgement Card showing

receipt of the notice (Ext. 4), which is proved in original. Therefore, the fact remains that the accusedpetitioner has admitted issuance of the

cheque. On the other hand, the complainantrespondent has also proved, as aforesaid, the issuance of the cheque, issuance of the statutory notice

and receipt of the same by the accused-petitioner.

The accused-petitioner has, however, raised an issue that the cheque involved in this case, was not issued in discharge of any debt or liability.

The learned counsel for the accusedpetitioner has submitted that the respondent/complainant failed to prove the liability as well as the transaction.

He has specifically referred to paragraph-4 of the complaint petition and submitted that the liability of the complainant-respondent for payment of

the cheque amount has not specifically been averred in the complaint and that the liability is not a matter of presumption.

In this context, learned counsel for the petitioner has referred to the decision of the Hon''ble Supreme Court in the case of John K. Abraham v.

Simon C. Abraham and another, reported in (2014) 2 SCC 236 and particularly, paragraph-9 thereof. Paragraph-9 of the aforesaid decision is

reproduced below for convenience.

It has to be stated that in order to draw the presumption under Section 118 read along with 139 of the Negotiable Instruments Act, the burden

was heavily upon the complainant to have shown that he had required funds for having advanced the money to the accused; that the issuance of the

cheque in support of the said payment advanced was true and that the accused was bound to make the payment as had been agreed while issuing

the cheque in favour of the complainant.

In the instant case, the accused-petitioner is found stating in his cross-examination that he paid Rs. 2,60,000/- from his house to the accused-

petitioner. He is an income tax assessee and he has also bank accounts. There is no evidence on record to show that the accused-petitioner had no

source to pay the aforesaid amount to the complainant/respondent. That being so, in the facts and circumstances of the case, the aforesaid

decision, referred to by the learned counsel for the accused-petitioner, is not applicable.

The learned counsel for the petitioner has also referred to a decision of this Court in the case of Anjelus Topno v. Shree Kanta Sharma,

reported in 2016 (3) GLT 474 , particularly paragraph-14 thereof, which reads as follows:

Reading of Sections 138 and 139 of the N.I. Act goes to show that out of the three ingredients comprising Section 138, a presumption is

available in favour of holder of a cheque that the same had been issued for discharge of any debt or other liability under Section 139 of the N.I.

Act. Section 139 of the N.I. Act does not give rise to a presumption with regard to existence of legally enforceable debt. A complainant has to

discharge this burden of existence of a legally enforceable debt and if he fails to do so, merely because he is a holder of a cheque issued by the

accused, conviction of the accused will not be warranted.

In the instant case, the accused-petitioner is found admitting that he had issued the cheque being payment against sale of some land by the

complainant/respondent and he had instructed to stop payment to his banker in view of the fact that the land sold got entangled in some dispute

after possession was handed over.

The learned trial Court as well as the learned appellate Court had taken presumption under Section 139 of the NI Act that the cheque involved

in this case was issued in discharge of debts/liability.

Referring to the above decision of this Court, the learned counsel for the accusedpetitioner has submitted that the complainant/respondent is to

prove the legally enforceable debt and since he failed to do so merely because he is a holder of a cheque issued by the accused-petitioner, the

conviction of the accused-petitioner was not warranted. This decision, referred to by the learned counsel for the petitioner, has spoken to the effect

that he must have legally enforceable debt and being holder of a cheque, issued by the accused-petitioner, it is not necessarily mean that the cheque

was issued in discharge of a legally enforceable debt. This decision, in the facts of the present case, is not applicable for the reason that the

accusedpetitioner in the instant case has admitted his debt/liability to pay the cheque amount to the complainant/respondent and the fact that he

issued the statutory notice within time and that the accused-petitioner failed to pay the amount within the time stipulated in the statutory notice, gave

rise to a legally enforceable debt/liability. As this proceeding under Section 138 of the NI Act is not barred under the provision of any law and

when the issuance of the cheque in discharge of debt or liability is admitted and in the absence of any proof of compelling reason to instruct the

bank to ''stop payment'' of the cheque amount, mere suggestion in crossexamination that he was compelled to instruct the bank to stop payment as

the land sold was entangled in a civil dispute, without such fact being substantiated, cannot be said to be a debt or liability not legally enforceable.

The learned counsel for the accused-petitioner has also tried to impress upon this Court that the cheque was dishonoured not because of

insufficiency of fund. The Hon''ble Supreme Court in Goalplast (P) Ltd. v. Chico Ursula Disuza, reported in (2003) 3 SCC 232, decided a similar

issue and held that even if the payment of a post-dated cheque was stopped by drawer and even if the cheque bounced as a result of the aforesaid

instruction, the same would attract section 138 of the N.I. Act.

Section 139 of the NI Act creates a statutory presumption that a cheque referred to in Section 138 of the NI Act is always issued in discharge

of a debt or liability; therefore, the learned Courts below are found to be right in taking the presumption in favour of the complainant/respondent

although this presumption is rebuttable and the burden is shifted to the drawer to prove that the cheque was not issued in discharge of any debt.

Section 118 of the NI Act deals with Presumptions as to negotiable instruments that every negotiable instrument was made or drawn for

consideration, and that every such instrument, when it has been accepted, endorsed, negotiated or transferred, was accepted, indorsed, negotiated

or transferred for consideration. Reading the provisions of Section 118 and Section 139 of the NI Act makes the position in respect of provisions

of Section 138 of the Act clear.

The accused-petitioner tried to make out a case that cheque, in question, was issued as an advance in pursuance to an agreement for sale of a

plot of land and there is a suggestion to that effect made to the complainant-respondent during his cross-examination, which was denied.

Therefore, the responsibility of rebutting the presumption lawfully raised under the provisions of Section 139 of the NI Act rests on the accused-

petitioner. The suggestion made, as aforesaid, cannot be treated as legally admissible evidence and the accused-petitioner did not adduce any

evidence to rebut the presumption. It is a settled position of law that it is not always necessary for the accused-petitioner to examine witnesses on

his own behalf to rebut such presumption. He can do so on the basis of evidence already on record, i.e., the evidence of the witnesses of the

complainant. But in the instant case, the accused-petitioner failed to rebut such presumption by way of cross-examination of the witnesses for the

complainant. In his statement, under Section 313 of the Cr.P.C., the accused-petitioner has specifically stated to a question that he had issued the

cheque, in question, for payment of the balance amount against purchase of land.

The learned counsel for the respondent, Mr. Bhowmik, has referred to the decision of the Hon''ble Supreme Court in the case of M.M.T.C.

Ltd. And another v. Medchl Chemicals and Pharma (P) Ltd. And another, reported in (2002) 1 SCC 234 and particularly, paragraph-19 thereof,

which reads as follows:

Just such a contention has been negatived by this Court has, in the case of Modi Cements Ltd. v. Kuchil Kumar Nandi reported in (1998) 3

SCC. It has been held that even though the cheque is dishonoured by reason of ''stop payment'' instruction an offence under Section 138 could still

be made out. It is held that the presumption under Section 139 is attracted in such a case also. The authority shows that even when the cheuqe is

dishonoured by reason of stop payment instructions by virtue of Section 139 the Court has to presume that the cheque was received by the holder

for the discharge, in whole or in part, of any debt or liability. Of course this is a rebuttable presumption. The accused can thus show that the ""stop

payment"" instructions were not issued because of insufficiency or paucity of funds. If the accused shows that in his account there was sufficient

funds to clear the amount of the cheque at the time of presentation of the cheque for encashment at the drawer bank and that the stop payment

notice had been issued because of other valid causes including that there was no existing debt or liability at the time of presentation of cheque for

encashment, then an offence under Section 138 would not be made out. The important thing is that the burden of so proving would be on the

accused. Thus a Court cannot quash a complaint on this ground.

The learned counsel for the respondent has also referred to the decision of the Hon''ble Supreme Court in T. Vasanthakumar v. Vijayakumari,

reported in (2015) 8 SCC 378 and particularly, paragraph-9 thereof, which reads as follows:

Therefore, in the present case since the cheque as well as the signature has been accepted by the accused respondent, the presumption under

Section 139 would operate. Thus, the burden was on the accused to disprove the cheque or the existence of any legally recoverable debt or

liability. To this effect, the accused has come up with a story that the cheque was given to the complainant long back in 1999 as a security to a

loan; the loan was repaid but the complainant did not return the security cheque. According to the accused, it was that very cheque used by the

complainant to implicate the accused. However, it may be noted that the cheque was dishonoured because the payment was stopped and not for

any other reason. This implies that the accused had knowledge of the cheque being presented to the bank, or else how would the accused have

instructed her banker to stop the payment. Thus, the story brought out by the accused is unworthy of credit, apart from being unsupported by any

evidence.

The cause of giving instruction to his banker to stop payment by the accused-petitioner was not for insufficiency of fund in his account, but,

admittedly, for the reason that subsequent to taking possession of land sold, he came to know that there is litigation in respect of land sold out by

the complainant/respondent, which, of course, remained not proved through the evidence on record. At the same time, he admitted that the cheque

was issued by him as payment of the balance amount of the consideration of the land sold. That being so, the decision in Medchl Chemicals and

Pharma (P) Ltd. (supra) is applicable in the instant case on the facts.

In the instant case, the payment was not made against the cheque to the complainant/respondent due to the instruction to ''stop payment'' and

not for any other reason. In the present case, since the cheque as well as the signature thereon by the accusedpetitioner are proved by the

complainant/respondent, the presumption under Section 139 would operate and the burden is on the accused to rebut such presumption.

Therefore, the decision of the Hon''ble Supreme Court in T. Vasanthakumar (supra) is also applicable in the facts of the case.

Therefore, in view of the above discussions, on the facts as well as on law relevant in the facts of the present case, this Court hold that the

accused-petitioner issued the cheque, involved in this case, in discharge of his debt/liability and inspite of receipt of statutory notice, he failed to pay

the money equal to the amount of the cheque.

In view of the above, the decision rendered by the learned trial Court as well as by the learned appellate Court is not found to have suffered

from any illegality, impropriety and incorrectness necessitating interference by this Court in exercise of its revisional power.

Therefore, the revision petition stands dismissed on merit.

Send down the LCR along with a copy of this judgment and order.