Yeshpal vs Vijayakumar

P.R. Shivakumar, J.—As against the concurrent judgment of the Courts below holding the petitioner guilty of the offence punishable u/s 138

of the Negotiable Instruments Act, 1881 (hereinafter referred as the Act), the present revision has been preferred.

The respondent herein has preferred a private complaint u/s 200 Cr.P.C. on the file of the learned Judicial Magistrate No. 2, Coimbatore

alleging that the petitioner herein/accused committed an offence punishable u/s 138 of the Act. According to the contents of the complaint, the

petitioner/accused borrowed a sum of Rs. 1,85,000/- from the respondent/complainant on 29.03.2000 promising to repay the same within three

months from the said date of borrowal and thereafter on 19.07.2000 he issued a cheque in favour of the respondent/complainant for the above

said sum drawn on City Union Bank, Ram Nagar Coimbatore. The cheque was returned by the bank with the endorsement ""funds insufficient

when the same was presented for encashment. Subsequent to the receipt of banker''s memo informing the respondent/complainant of the said fact,

a statutory notice u/s 138 of the Act was issued to the petitioner/accused. Even after receiving the said notice, the petitioner/accused failed either to

send a reply or to make payment and hence the respondent/complainant was constrained to prefer the complaint for prosecuting and punishing the

petitioner/accused for the said offence.

The petitioner/accused who entered appearance on receipt of process, denied the averments found in the complaint and pleaded not guilty. In

the trial that followed, two witnesses were examined as PW1 and PW2 and nine documents were marked as Ex.P1 to Ex.P9 on the side of the

complainant. After the accused was examined u/s 313 Cr.P.C. regarding the incriminating materials appearing in the evidence of the complaint, he

entered upon his defence and examined himself as DW1. Three documents were marked as Ex.D1 to Ex.D3 on the side of the accused. The

learned Judicial Magistrate No. II, Coimbatore considered the evidence in the light of the arguments advanced on either side and upon such a

consideration, came to the conclusion that the petitioner/accused was guilty of the offence punishable u/s 138 of the Act and sentenced him to

undergo simple imprisonment for a period of one and half years and also directed him to pay a compensation of Rs. 90,000/- to the

respondent/complainant with a further direction to undergo simple imprisonment for a period of three months in case of default to pay such

compensation. The appeal preferred there from by the petitioner/accused in C.A. No. 352 of 2003 was heard and disposed of by the learned

Additional District Judge (Fast Track Court No. II, Coimbatore) by a judgment dated 06.12.2005. The learned appellate Judge concurred with

the judgment of the trial Court in all respects and dismissed the above said appeal. Hence the present revision has been filed by the

petitioner/accused before this Court.

This Court heard the submissions made by the learned Counsel for the petitioner and the learned Counsel for the respondent and perused the

materials available on record.

The petitioner herein was prosecuted before the learned Magistrate No. II, Coimbatore for an offence punishable u/s 138 of the Act and at the

conclusion of trial he was convicted and sentenced as indicated supra. Having unsuccessfully challenged the judgment of conviction pronounced

and sentence imposed by the trial Court before the learned Additional District Judge (Fast Track Court No. II, Coimbatore) in C.A. No. 352 of

2003, the petitioner/accused has come forward with this present revision.

The learned Counsel for the petitioner submitted that the specific case of the respondent/complainant was that he lent a sum of Rs. 1,85,000/-

on 29.03.2000 for which he got Ex.P1 cheque on 19.07.2000 and that the respondent/complainant who figured as PW1 made an assertion that

the said amount was drawn from his bank account to be lent to the petitioner/accused; that the said assertion was proved to be false by the Bank

pass book of the respondent which is marked as Ex.P9; that the said fact coupled with the further fact that the respondent/complainant for more

than three months did not get any document or security for such a huge amount allegedly lent by him would be enough to show that there was no

pre existing debt in discharge of which the cheque would have been issued and that the said circumstance would be enough atleast, to rebut the

presumption that the cheque was issued for the discharge of the debt as alleged by the respondent/complainant.

It is the further contention of the learned Counsel for the petitioner that actually no notice was served upon him and the acknowledgement card

produced and marked as Ex.P4 did not contain his signature; that the address found in the said notice marked as Ex.P3 was not that of the

petitioner/accused and that on that score alone the complaint should have been rejected as not maintainable. The learned Counsel contended

further that the signature found in Ex.P1 cheque was denied by the petitioner/accused; that in such circumstances the respondent/complainant

should have taken steps to get the signatures found in the cheque compared with the admitted or proved signatures of the petitioner/accused by a

handwriting expert and that the trial Court committed an error in making such a comparison without the help of a hand writing expert to arrive at

the conclusion that the signature found in Ex.P1 cheque was that of the petitioner/accused.

This Court heard the submissions made in reply to the above said arguments and paid his anxious considerations to the same.

The cheque allegedly issued by the petitioner/accused in favour of the respondent/complainant is Ex.P1. It is also not in dispute that the cheque

when presented for collection, was returned with the banker''s memo with an endorsement ""funds insufficient"". The return memo is dated

21.07.2000. Within the statutory period Ex.P3 notice was issued and the receipt of the same was acknowledged by Ex.P4 acknowledgement

card. In this regard, the learned Counsel for the petitioner would contend that the address found in the notice was not that of the petitioner and the

signature found in Ex.A4 acknowledgement was not that of the petitioner/accused or any one of his employees. It is not in dispute that the

petitioner/accused is running a proprietory concern under the name and style of ""Elite Surgical Scientific Company"". The said notice seems to have

been sent to the address where the petitioner/accused was running on the said business as a proprietory concern. Further more, the learned

Judicial Magistrate has rightly pointed out the fact that the petitioner/accused filed a petition giving the very same address as his address in an

application for recalling a warrant issued against him by the trial Court. That apart, there is no evidence on the part of the petitioner/accused to

show that his proprietory concern is functioning somewhere else or some other person is either residing or doing business in the address found in

Ex.A3 notice. The complaint also contains very same address. The Courts below have properly appreciated the said fact and come to the correct

conclusion that the contention of the petitioner/accused, as if notice was not served upon him could not be countenanced and that the

respondent/complainant was able to prove the service of the said notice at the correct address of the petitioner/accused.

The next contention of the learned Counsel for the petitioner is that in the absence of admission of the signature found in the disputed cheque

and more particularly when such signature has been disputed, the learned Judicial Magistrate should not have ventured to make a comparison of

the disputed signature with the available signature to arrive at a conclusion that the signature found in the cheque was that of the petitioner/accused.

According to the submissions made on behalf of the petitioner, the learned Judicial Magistrate is not trained to play the role of a handwriting expert

to identify the signature and the rule of prudence requires the Court not to make such a comparison without the help of a handwriting expert as the

Court will not be in a position to find out an intelligent forgery. It is true that the rule of prudence requires the Court to get a help of a hand writing

expert in such cases. But it is not always mandatory that the matter shall be referred to a hand writing expert. The court in appropriate cases is

empowered to make a comparison to arrive at a conclusion. Even the expert''s opinion will not be a conclusive proof and the same would, at best,

guide the Court to arrive at a correct conclusion. In this case, the learned Counsel for the petitioner has rightly pointed out an admission made by

PW1 that he was not aware familiar with the signature of the petitioner/accused and that nobody witnessed the accused signing the cheque. On the

other hand, the learned Counsel for the respondent/complainant would contend that there is no unambiguous denial of the signature of the

petitioner/accused and on the other hand, there is an admission that the cheque pertains to the account of the petitioner/accused; that the cheque

was issued in favour of one unnamed third party and that would imply that the cheque was issued with the signature of the petitioner/accused. In

fact the petitioner/accused having taken a stand that his cheque issued to some other person (without naming him), was filled up in the name of the

respondent/complainant for the purpose of prosecution him, has not chosen to come forward to state under what circumstances and for what

purpose the cheque was issued to the third person. The same will be enough to come to the conclusion that the signature found in the cheque was

that of the petitioner/accused. In this case as there is no specific denial that the cheque was pertaining to the bank account maintained by the

petitioner/accused. It is not the case of the petitioner that the cheque was issued without even signing the same. Therefore, this Court is of the

considered view that the procedure adopted by the learned Judicial Magistrate does not suffer from any infirmity or defect warranting any

interference in this regard.

The next contention raised by the learned Counsel for the petitioner is more vital than the other two contentions. According to the learned

Counsel for the petitioner, even assuming that the cheque was issued by the petitioner to the respondent/complainant and that there shall be a

presumption u/s 139 that the cheque was issued for the discharge in whole or part of a debt or liability, such a presumption is only a rebuttable one

and the degree of proof for the rebuttal of such presumption is not comparable with that of the burden on the prosecution to prove the charge. In

such cases, it shall be sufficient for the accused to prove by preponderance of probabilites the alleged debt or liability could not be true. The fact

that the respondent/complainant is said to have lent a huge amount, namely 1,85,000/- even without getting any document or security and kept

quite for more than three months, coupled with the fact that the specific contention of PW1 regarding the source from which he got the amount to

be lent to the petitioner/accused stands disproved, will be enough to rebut such presumption and recast the burden of proof on the

respondent/complainant to prove the existence of debt alleged by him. The respondent/complainant has miserably failed to prove the existence of

debt alleged by him and hence the findings of the Courts below in this regard are to be held perverse and liable to be set aside by this Court in

exercise of its appellate powers.

This Court is able to find substance and force in the above said contention made by the learned Counsel for the petitioner. PW1 has made an

assertion that he was having an account with State Bank of India, Race Course Branch, Coimbatore and that a sum of Rs. 1,85,000/- was drawn

on the date of alleged lending. He has also asserted that he could produce the documents relating to the bank accounts to prove the same. Further,

he did not produce the statement of his bank account till the petition seeking a direction for the production of the same was filed by the

petitioner/accused. At last the bank pass book was produced and marked as Ex.P9. From Ex.P9 it is quite obvious that the amount standing to the

credit of the said account on 29.03.2000 was only a paltry sum of Rs. 594/-. The said fact coupled with the fact that the respondent/complainant

did not get any document as security for the alleged loan would be enough to hold that the presumption u/s 139 stands rebutted. Without any

hesitation whatsoever, this Court comes to the conclusion that both the Courts below committed an error in this regard and the finding of the

Courts below is definitely discrepant. Since the appellant/accused has successfully rebutted the presumption, the burden can be shifted on the

respondent/complainant to prove that there was debt a legally recoverable debt or other liability in discharge of which the cheque was issued. As it

is the definite case of the complainant that the appellant/accused borrowed a sum of Rs. 1,85,000/- and in discharge of the same the cheque was

issued, the term ""other liability"" appearing in Section 138 will not be applicable to the case on hand. When the question as to whether the

respondent/complainant has discharged his burden of proof that there was a legally recoverable debt as contended by him is considered the only

conclusion that can be arrived at in this case is that the respondent/complainant failed to establish the same.

In this regard, observation made by the Honourable Supreme Court in Krishna Janardhan Bhat Vs. Dattatraya G. Hegde, is worth mentioning.

The following are the observations made by the Apex Court;-

We are not oblivious of the fact that the said provision has been inserted to regulate the growing business, trade, commerce and industrial

activities of the country and the strict liability to promote greater vigilance in financial matters and to safeguard the faith of the creditor in the drawer

of the cheque which is essential to the economic life of a developing country like India. This, however, shall not mean that the courts shall put a

blind eye to the ground realities. Statute mandates raising of presumption but it stops at that. It does not say how presumption drawn should be

held to have rebutted. Other important principles of legal jurisprudence, namely presumption of innocence as human rights and the doctrine of

reverse burden introduced by Section 139 should be delicately balanced. Such balancing acts, indisputably would largely depend upon the factual

matrix of each case, the material brought on record and having regard to legal principles governing the same.

Applying the said principle of law enunciated by the Supreme Court to the facts of the case on hand, this Court comes to the conclusion that the

petitioner/accused has clearly rebutted the presumption and on the other hand the respondent/complainant has failed to prove the existence of a

legally enforceable debt or other liability.

For all the reasons stated above, this Court comes to the conclusion that the petitioner has made out a clear case that both the Courts below

committed an error in holding the petitioner/accused guilty of the offence punishable u/s 138 of Negotiable Instruments Act and that the petitioner is

entitled to be acquitted of the said charge. Accordingly, the revision succeeds, the judgments of the Courts below are set aside and the petitioner is

acquitted of the offence of which he stood charged. The fine amount already deposited by the petition shall be refunded to the appellant/accused.

In the result, the criminal revision case is allowed.