Vaibhav Marketing Corporation vs Vidya Dabke Tarmay Agencies

K.N. Phaneendra, J.—The appellant-Vaibhav Marketing Corporation being aggrieved by the judgment of acquittal recorded by the Principal Civil Judge (Jr. Dvn.) and J.M.F.C., Hubli in C.C. No. 141/2004 dated 13.01.2009 preferred this appeal before this Court challenging the said judgment of acquittal on several grounds.

After issuing such notice the respondent-accused appeared before the Court and contested the appeal.

I have heard the arguments of the learned Counsel for the appellant and the respondent. I have carefully perused the records i.e. oral and documentary evidence produced by the parties before the Trial Court and also the reasons recorded by the Trial Court in acquitting the accused/respondent herein.

On over all analysis of the entire materials on record the point that would arise for the consideration of this Court is:

Whether the appellant has made out any reasonable or substantial ground to interfere with the judgment of acquittal recorded by the Trial Court?

In order to answer this question, it is just and necessary for this Court to have brief factual matrix of this case. The Court should also bear in mind in criminal cases when the accused is acquitted by the Trial Court, under what circumstance the appellate Court can interfere with a judgment of acquittal. It is worth to note here a decision of the Apex Court in S. Govindaraju Vs. State of Karnataka 2013(4) AKR 289 held that:

It is a settled legal proposition that in exceptional circumstances, the appellate Court, for compelling reasons, should not hesitate to reverse a judgment of acquittal passed by the Court below, if the findings so recorded by the Court below are found to be perverse, i.e. if the conclusions arrived at by the Court below are contrary to the evidence on record, or if the Court''s entire approach with respect to dealing with the evidence is found to be patently illegal, leading to the miscarriage of justice, or if its judgment is unreasonable and is based on an erroneous understanding of the law and of the facts of the case. While doing so, the appellate Court must bear in mind the presumption of innocence in favour of the accused, and also that an acquittal by the Coun below bolsters such presumption of innocence.

and in a decision reported in Govindaraju @ Govinda Vs. State by Sriramapuram P.S. and Another, . The Apex Court has laid down certain principles as to under what circumstance the Appellate Court could interfere with the judgment of acquittal i.e. to say:

The Appellate Court can interfere with the judgment of acquittal but normally should not substitute its views unless it records the reasons that findings recorded by the Lower Court are erroneous, contrary to the settled principles of criminal law and the judgment of acquittal is perverse on facts or law.

In view of the above said judgments, it is to be borne in mind that during the course of the trial, the accused is presumed to be innocent unless the guilt is proved beyond reasonable doubt producing convincing and cogent evidence. If the view based on reasons recorded by the Trial Court is also a possible view on the basis of the evidence on record, though the Appellate Court after appreciation of the same materials on record comes to a different conclusion or different view such view should not be substituted to that of the view expressed by the Trial Court. Bearing in mind the above said golden principles, now let me go through the materials on record.

For the purpose of convenience, I would like to retain the ranks of the parties as per their ranks before the Trial Court.

The complainant (appellant herein) lodged a complaint u/s 200 Cr.P.C. for the alleged offence u/s 138 of Negotiable Instruments Act. The complainant has in fact stated in the complaint that the accused and the complainant have commercial transactions pertaining to goods like Phenyl, Bleaching Powder, Brooms, Sanitizers, Agarbatties etc. The accused is a wholesale customer of the complainant and often used to purchase the properties on credit basis and he had an account with the complainant. In this background, it is alleged that on 15.11.2002 in order to discharge part of his liability with reference to his outstanding liability with the complainant the accused issued a cheque for Rs. 20,000/- bearing its No. 001692 drawn on Central Bank of India, Dapoli with an assurance that the said cheque would be honoured if presented. It is alleged that on that assurance the said cheque was presented to the Bank on 09.04.2003. However, the said cheque was returned dishonoured on the ground "payment stopped by the Drawer". The complainant in consonance with Section 138 of N.I. Act issued a notice on 28.04.2003. But in spite of receipt of the said notice the accused did not chose to discharge his liability. Therefore, the complainant lodged the complaint on 12.06.2003.

The accused after entered his appearance before the Trial Court not at all disputed the issuance of the cheque and also presentation of the said cheque before the Bank, dishonour of the said cheque and issuance of notice as pleaded by the complainant. Therefore, compliance of the procedural legal requirements as contemplated u/s 138 of N.I. Act was not at all questioned by the accused before the Trial Court. On the other hand, though the defence has not been disclosed at any point of time earlier to the lodgment of the complaint, but during the course of evidence, the accused has disclosed specifically. The defence taken up by the accused was that on the date of issuance of the cheque by the accused on 15.11.2002 there was absolutely no liability on the part of the accused and the said cheque was issued as an advance payment to the complainant for the purpose of supplying some goods in connection with the transaction between the accused and the complainant. The accused also pleaded that the said cheque was issued with a condition that if the goods are not supplied the accused is entitled to stop the payment under the said cheque.

Another important contention taken up by the accused is that the said cheque was presented even earlier to 09.04.2003 and it was dishonoured and in fact a written intimation was given to the accused and the accused had orally replied to the complainant that there was absolutely no liability. Therefore, the presentation of the cheque for the second time is authorised by law. Therefore, the cause of action which arose for lodging a complaint on the disputed dishonoured cheque lapses due to the earlier presentation and issuing of the intimation to the accused. With these grounds the accused has contested the proceedings.

The burden in fact in this case lies on the accused to prove the defence taken up by him. The law recognises by way of presumption under Sections 118 and 139 of N.I. Act that once the cheque has been admitted by the accused issued in favour of the complainant it raises a presumption that the said cheque was issued containing the date, amount, signature of the accused and was issued for repayment of a debt or any liability on the part of the accused. Therefore, it becomes incumbent upon the accused to prove his defence in order to create a serious doubt in the case of complainant. If she is successful in creating doubt in the mind of the Court, with regard to non-existence of any debt or liability on the part of the accused or with regard to any other factual aspects or legal aspects, then only the Court can draw an inference that the accused has rebutted, the said presumption under the above provision so as to shift the burden or onus to the complainant again in order to prove his case beyond all reasonable doubt.

Though the burden cast upon the accused to prove the defence need not be by means of beyond reasonable doubt. Nevertheless, the accused has to place some convincing and cogent materials in order to satisfy the Court that the case of the complainant is doubtful. In this backdrop, it is needless to say that the accused can prove his defence by means of preponderance of possibilities and those probabilities, in fact, should be of such nature it should preponder upon the case of the complainant atleast shake the case of the complainant to shift the burden on to the complainant.

Now, let me see whether the accused has placed sufficient material in order to create serious doubt in the case of the complainant. The accused has firstly relied upon the document Ex. D2. According to the accuse, during the course of transaction between herself and complainant, DW-3 by name one Mr. Mahesh Ganesh Kulkarni was working as a Sales Representative of the complainant from July 2002 to November 2003. In the transaction between the accused and the complainant in order to increase the business of the company and to take orders from the distributors DW-3 has met the accused and informed her that the Company would make the payment for the expenditure for Advertisements that may be incurred by the accused in making the Advertisements in the name of the complainant Company. In this regard, though the accused was reluctant to give any advance cheque for the supply of goods by the complainant during the regular course of transaction, but in view of the assurance given by DW-3 an advance cheque for Rs. 20,000/- was given towards the 50% of the value of the orders booked by this accused with the complainant with a condition that the said cheque should not be presented to the Bank unless the goods are supplied and with a further condition that if the goods are not supplied the accused is entitled to give intimation to his Bankers to stop the payment.

In order to prove this defence, in fact, the accused has examined herself as DW-1 and stated the same in her examination-in-chief wherein she denied the existence of any debt or liability and said, the cheque was issued only as an advance amount for supply of goods. The accused also examined DW-3 who was the Sales Representative of the complainant during the relevant point of time. In fact, DW-3 has categorically stated that in the month of October, November 2002 in order to improve the business of the complainant, the company has assured the accused to make some advertisements, and he has also required the accused to issue cheque towards 50% of the value of the orders booked by the accused with the complainant and he has also stated that in this regard a cheque was issued for Rs. 20,000/- on condition that if the goods are not supplied the accused is entitled to stop the payment. This witness was subjected to cross-examination. On careful perusal of the cross-examination of this witness nowhere it is suggested that this witness was not at all working with the complainant. If that being so, the complainant has to explain what are the duties of this. DW-3, whether he is competent to issue any letters or enter into or execute any documents with the customers of the complainant and how he should behave with the customers of the complainant. In the course of cross-examination it is only suggested that in collusion with the accused this document Ex. D2 was concocted. This admission clearly goes to show that deed Ex. D2 was well within the knowledge of the complainant that DW-3 has entered into such contract or such agreement with the accused during the transaction between the complainant and the accused. The complainant has also not whispered anything in his examination-in-chief so far as this particular person DW-3 is concerned. Even after the evidence being led by the accused and also leading the evidence of DW-3 the complainant has not taken any steps to examine himself further in order to deny the transaction between the accused and DW-3 on behalf of the complainant. There is absolutely no suggestions as to why this DW-3 has to enter into such agreement with the accused and whether there was any ill-will or hatred misunderstanding between the complainant and as well as this DW-3. Though it is stated that, in the year 2003 this particular person has left the job with the complainant, but it is not stated due to any strained relationship DW-3 has left the company. Unless there is some strong materials before the Court that the complainant and DW-3 have got any misunderstanding between themselves and in order to wreak vengeance DW-3 has entered into agreement with the accused for a meager sum of Rs. 20,000/- in order to cheat or defraud the complainant. Therefore, the transaction that has been entered into between the accused and DW-3 on behalf of the complainant cannot be easily brushed aside. Whatever may be the reasons, it should be inferred that the parties have entered into such contract during the course of employment by DW-3. Such transaction has been entered into and as a master of DW-3 such transaction cannot be denied by the complainant.

Learned Counsel for the appellant very strenuously contended that if this document-Ex. D2 is meticulously observed this creates a serious doubt, whether a reputed company like the complainant can enter into such contract or enter into such transaction. He drawn my attention to Ex. D2 and submitted that Ex. D2 is in the hand writing and not on the letter head of the complainant. Secondly he contended that the letter also does not bear atleast the seal of the company and evidence of DW-3 also doubtful whether this document is actually entered into on behalf of the Company with the accused or not. Of course, the above said submission of the learned Counsel is true that this document is not on the letter head and no seal is there on the letter. But it bears the signature of DW-3 who has categorically mentioned that such letter was issued for and on behalf of the complainant (Vaibhav Marketing Corporation). This particular document being produced before this Court and even after producing this document the signature on the particular document has not been denied by the complainant in order to show that this particular document is concocted by the accused herself. It is the case of the complainant that the said document is a fabricated document. When such stand was taken by the complainant that the document is fabricated it is the burden on the complainant to prove that this particular document has not been entered into by DW-3 for and on behalf of the Company. Whatever may be the relationship between the accused and DW-3, in my opinion, relationship between complainant and DW-3 play a dominant role during the relevant point of time. This document is entered into between the parties when this DW-3 was working with the complainant that there is no dispute so far as that particular aspect is concerned. The cross-examination of DW-1 in fact, also fortifies to certain extent with the defence taken by the accused. The cross-examination portion at page 6 shows that when the disputed cheque came into existence at that time one Mr. Kulkarni was working with the complainant. It is also stated that the accused has given a reply notice to Ex. P4, but the said reply notice is not at all produced before the Trial Court by the complainant. It also creates a serious doubt why the said reply notice was not produced. In fact, the accused has produced the said reply notice before the Court, which clearly establishes that the accused has taken up the defence that the said cheque was issued not for discharging any of her earlier liability, but for the purpose of supplying certain goods in future. It is a categorical statement in the said notice that

as the Company was eager to ameliorate the business relations with the accused, the accused acceded the request of the Company representative Mr. Kulkarni and placed the order for monkey brand brooms, Economy, Sanata, 333 & 555, 333 & 555 (International), Sweep Medicure, etc., and while placing the orders he has issued a cheque for Rs. 20,000/- as an advance subject to a condition that the accused should receive the products from the company within 3-4 days and if he does not receive the said products he would stop the payment of the said cheque.

This clearly goes to show immediately after receipt of the legal notice under Section. 138 of N.I. Act, she replied the same. Though it is admitted by the complainant that reply was given by the accused he has not stated in his complaint or in the evidence why he has not produced that notice before the Court. Further, added to the above said lapse on the part of the complainant he has also stated that Ex. P1-cheque was issued with reference to some orders to the goods. It is stated that in respect of some orders for supplying of goods the said cheque Ex. P1 was given. If this evidence of PW-1 is properly understood in fact, it corroborates Ex. D2. Therefore, Ex. D2 is not only supported by the evidence of DW-3 but also by the evidence of PW-1, otherwise he would have stated in the cross-examination also that the said cheque was issued for repayment of the earlier liability or the part of the outstanding liability on the part of the accused. Therefore, looking to the above said circumstances, I am of the opinion that the accused has produced certain materials before the Court in order to atleast creates a doubt in the case of the complainant to shift the burden on to the complainant. But the complainant after the accused led the evidence and produced Ex. D2 has never entered into the witness box to explain Ex. D2 and as well as the evidence of DW-3. Therefore, the Trial Court in fact, considering these documents has recorded its opinion that the accused has placed some materials to probablise her case though not as I have stated the said material should be of such a nature that the case of the accused is said to have been proved beyond reasonable doubt.

Now, coming to the next important aspect as raised by the learned Counsel for the accused that the said cheque was even presented much earlier to 09.04.2003 i.e. to say the said cheque was presented in the month of November or December 2002 itself and that the said cheque came to be dishonoured and the complainant has also intimated the accused with regard to the dishonour of the cheque and in turn the accused has informed the complainant that she is not liable to pay any amount under the said cheque. Therefore, the cause of action arose to the complainant to file the complaint had been extinguished, by means of non-filing of the complaint when the cheque was dishonoured for the payment. This argument of the learned Counsel is liable to be turned down for the simple reason that the Accused has to show that after dishonour of the cheque on earlier occasion the complainant has complied all the legal requirements u/s 138 except filing the complaint. The records show that the complainant has not at all issued any notice u/s 138(b) of N.I. Act. calling upon the accused to discharge his liability under the disputed cheque prior to 28.04.2003. It is not the case of the complainant that at an earliest point of time he has presented the cheque before the Court prior to 09.04.2003. It is not the case of the accused that after the presentation of the cheque on the earlier occasion that the complainant had issued any legal notice to him or any written intimation to him calling upon him to discharge the liability. Therefore, the law on this point is that the cheque can be presented any number of times within the stipulated period from the date of issuance of the said cheque. If the complainant has not issued any legal notice on the dishonour of the cheque calling upon the accused to discharge her liability no cause of action accrues to file a compliant. It is the prerogative of the complainant to present the cheque and wait for the depositing of the amount by the accused till the stipulated period is elapsed. Therefore, in this particular case, even assuming for a moment that the complainant has presented the said cheque earlier to 09.04.2003, but legal notice appears to have not been issued as contemplated u/s 138 of N.I. Act. The complainant is competent to present the said cheque even for the second time. Section 138 of the Negotiable Instruments Act, in fact, mandates at Section 138(b) that:

the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid.

(emphasis supplied)

The learned Counsel for the accused tried to rely upon a document which is not marked before the Trial Court stating that the accused has given a carbon copy of the intimation with regard to the dishonour of the cheque earlier presented by the complainant. The said document is at page No. 141 of the Trial Court records. Though this document is in the letter head of the complainant the xerox copy of the document is produced before the Trial Court. Though it is contended by the Counsel for the accused that the Trial Court has directed the complainant to produce the original of this document he has not produced. Therefore, the Trial Court has rightly drawn an adverse inference against the complainant. This document, in my opinion, cannot be looked into for the simple reason that this document is not marked before the Trial Court or any effort has been made before this Court to see that this document is marked legally. The Indian Evidence Act is very explicit so far as production of the secondary evidence before the Court. u/s 65 of the Indian Evidence Act, which deals with the case of secondary evidence, as to how legally documents may be given by way of secondary evidence. If the complainant wanted to produce this document as secondary evidence, mere calling upon the other side to produce the original is not sufficient. But he has to request the Court to permit him to lead the secondary evidence and get that disputed document marked. When actually this particular xerox copy was served on the accused by the complainant is also not made clear in the course of evidence of DW-1. In the affidavit evidence filed before the Court by DW-1, nowhere it is stated that this particular cheque was presented by the complainant at the earliest point of time and an intimation was given to DW-1 and he in fact informed the complainant that he is not liable to pay any amount. It appears without there being any evidence this particular aspect has been argued before the Trial Court and the Trial Court also misguided it self by relying on irrelevant materials recorded its finding that the complaint is barred by limitation and the complainant is not entitled to present the cheque for the second time. Such observation by the Trial Court, in my opinion, is not based on any materials on record. Though this Court has answered the question raised by the accused in the negative that the said cheque was earlier presented and there was no cause of action for the second complaint, nevertheless, in view of the findings given by this Court so far as the first point is concerned that the accused was successful in creating serious doubt in the case of the complaint and rebutting the presumption raised u/s 118 and 139 of N.I. Act and that the complainant has not led any further evidence in order to disprove the doubts raised by the accused and on the other hand, to prove her case beyond reasonable doubt. In my opinion, the reasons recorded by the Trial Court that the complainant has not proved the case beyond reasonable doubt is also a possible view on the basis of the materials on record.

Therefore, I am of the opinion such view though is on materials if this Court differs from the opinion of the Magistrate, the opinion of the Appellate Court should not be substituted. With these observations, I am of the opinion, the appeal is devoid of merits and the same is liable to be dismissed.

Accordingly, the appeal is dismissed.