Special Leave Petitioner appealed an acquittal. The High Court held the complainant failed to prove the cheque was for a legally enforceable debt to the accused, as the cheque was issued by a different party. The acquittal was upheld.
The appeal is dismissed without costs.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT AT CALCUTTA (CRIMINAL APPELLATE JURISDICTION)
PRESENT:
THE HON’BLE JUSTICE SIDDHARTHA ROY CHOWDHURY
CRA 559 of 2019
M/S RAHUL ENTERPRISE
VS. M/S A.B. CONSTRUCTION & ANR.
| For the Petitioner | : Mr. Kazi Safiullah, Adv. |
|---|---|
| For the Opposite Parties | : Mr. Jayanta Narayan Chatterjee, Adv., Ms. Moumita Pandit, Adv., Ms. Jayashree Patra, Adv., Ms. Sreeparna Ghosh, Adv., Ms. Ritashree Banerjee, Adv., Ms. Dipanwita Das, Adv. |
| Hearing concluded on | : 15thSeptember, 2022 |
| Judgement on | : 19thSeptember, 2022 |
:- Siddhartha Roy Chowdhury, J
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proprietor Ajay Basu contending, inter alia, that in discharge of the liability in connection with the purchase of a tractor by a party, the accused person issued a cheque of Rs. 3,23,600/- in favour of the complainant drawn on Oriental Bank of Commerce which was presented to Punjab National Bank, Malda Branch. The cheque was returned with the endorsement “payment stopped by the borrower”. The complainant then issued a notice calling upon the accused person to pay the said amount. Despite receipt of notice the accused person refused to act in terms of the notice. Hence, petition of complaint was filed and learned Trial Court having found prima facie case issued process under Section 138 of the Negotiable Instrument Act. Accused person upon receipt of such notice surrendered to the jurisdiction of learned Trial Court. He was examined under Section 251 of the Cr.P.C. and pleading innocence he claimed to be tried.
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the case on remand, with the direction upon the learned Trial Court to allow the complainant to lead further evidence to prove that Subhrangshu Das is the sole proprietor of the appellant. Pursuant to that order, the appellant was allowed to adduce evidence and learned Chief Judicial Magistrate, Malda was pleased to pass the judgement impugned after complying with the order passed in CRA 504 of 2013. An order of acquittal was recorded by the learned Trial Court.
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and learned Trial Court was under obligation to decide all the points required to adjudicate a proceeding under Section 138 of the N.I. Act, after complying with the direction given in CRA 504 of 2013. I am not inclined to imbibe myself with the view expressed by Kazi Safiullah, learned Counsel for the appellant.
“8. It is true that Section 138 of the Act was enacted to punish unscrupulous drawers of cheques who, though purport to discharge their liability by issuing cheque, have no intention of really doing so, yet to fasten a criminal liability under the said provision, necessary ingredients of the Section are to be satisfied. Section 138 of the Act reads as follows:
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 banker for payment of any amount of money to another person from out of that account
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for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply unless--
(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier;
(b) 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; and
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.
Explanation.--For the purposes of this section, "debt or other liability" means a legally enforceable debt or other liability.”
9. It is manifest that to constitute an offence under Section 138 of the Act, the following ingredients are required to be fulfilled:
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(i) a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account;
(ii) The cheque should have been issued for the discharge, in whole or in part, of any debt or other liability;
(iii) that cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity whichever is earlier;
(iv) that cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank;
(v) the payee or the holder in due course of the cheque 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 15 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
(vi) the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice;
10. Being cumulative, it is only when all the afore-mentioned ingredients are satisfied that the person who had drawn the cheque can be deemed to have committed an offence under Section 138 of the Act.”
8. In M. S. NARAYAN MENON VS. STATE OF KERELA reported in
(2006) 6 SCC 39 , Hon’ble Supreme Court held that the presumptions under Sections 118 (a) and 139 of the Act are rebuttal and the standard of proof required for such rebuttable is preponderance of
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probabilities and not proof beyond reasonable doubt. The Hon’ble Court observed:-
“In terms of Section 4 of the Evidence Act whenever it is provided by the Act that the Court shall presume a fact, it shall regard such fact as proved unless and until it is disproved. The words 'proved' and 'disproved' have been defined in Section 3 of the Evidence Act.
Applying the said definitions of 'proved' or 'disproved' to principle behind Section 118(a) of the Act, the Court shall presume a negotiable instrument to be for consideration unless and until after considering the matter before it, it either believes that the consideration does not exist or considers the non-existence of the consideration so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that the consideration does not exist. For rebutting such presumption, what is needed is to raise a probable defense. Even for the said purpose, the evidence adduced on behalf of the complainant could be relied upon.
The standard of proof evidently is preponderance of probabilities. Inference of preponderance of probabilities can be drawn not only from the materials on records but also by reference to the circumstances upon which he relies.”
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the owner of Mourya Finance Company Limited and it was Ajit Sinha who handed over the cheque in question drawn on Oriental Bank of Commerce by A.B. Construction owned by Ajay Basu.
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otherwise legally enforceable rather it is established that the cheque was received from Ajit Sinha.
VS. DATTATRAYA G. HEGDE reported in (2008) 4 SCC 54 held:-
“In India however, subject to the statutory interlooks the said principle forms the basis of criminal jurisprudence. For the aforementioned purpose, the nature of the offense, seriousness as also gravity thereof, may be taken into consideration. The Courts must be on guard to see that merely on application of presumption as contemplated under Section 139 of N.I. Act, same may not lead to injustice or mistaken conviction.”
(SIDDHARTHA ROY CHOWDHURY, J.)
3 issues framed by the court
Whether the complainant discharged the burden of proving that the cheque was issued in discharge of a legally enforceable debt.
Whether the accused successfully rebutted the presumption under Section 139 of the Negotiable Instrument Act.
Whether the acquittal order passed by the learned Chief Judicial Magistrate warrants interference in this appeal.
Colour shows how this judgement treated each authority
JUGESH SAHGAL VS. SHAMSHER SINGH GOGIApplied¶27
(2009) 14 SCC 683 · Who else cites this
M. S. NARAYAN MENON VS. STATE OF KERELAApplied¶46
(2006) 6 SCC 39 · Who else cites this
KRISHNA JANARDHAN BHATT VS. DATTATRAYA G. HEGDEExplained¶68
(2008) 4 SCC 54 · Who else cites this
3 provisions across 1 enactments
M/s Rahul Enterprise
M/s A.B. Construction
Siddhartha Roy Chowdhury
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
