IMPORTANT POINT
When complainant discharged his initial burden by himself as PW 1, showing that cheques were issued for purchases on credit, presumption u/s 139 ought to be raised.

JUDGMENT :

R. BANUMATHI, J.

These appeals arise out of the judgment dated 28.07.2008 in Criminal Appeal Nos.53 and 54 of 2006 passed by the High Court of Bombay in and by which the High Court dismissed the appeals filed by the appellant-complainant thereby upholding the acquittal of the respondent-accused Sanjay Jain under Section 138 of the Negotiable Instruments Act.

2. Brief facts which led to filing of these appeals are as under:-

The appellant-complainant had been supplying the commodities and rice bags to the respondent-accused on his request. In this regard, the respondent-accused issued various cheques which when presented for collection were dishonoured. The appellant had filed two complaints under Section 138 of the Negotiable Instruments Act - complaint No.339/OA/NI/2004/A and complaint No.499/OA/NI/2004/A against the respondent-accused alleging that the cheques issued by the respondent-accused in lieu of payment owed to the appellant were dishonoured on presentation. It was averred that despite issuance of legal notice, the respondent did not make payments.

3. In case No.339/OA/NI/2004/A, the respondent-accused issued three cheques drawn on UTI Bank details of which are as under:-

4. In case No.499/OA/NI/2004/A, the respondent-accused issued nine cheques, details of which are as under:-

5. When the above said cheques were presented to United Western Bank, Margao Branch for encashment, cheques were returned by the bank unpaid on 04.02.2004 and 20.02.2004 with the endorsement “not arranged for/funds insufficient” and “funds insufficient”. The appellant thereafter issued legal notices to the respondent-accused dated 05.02.2004 and 23.02.2004 respectively making a demand for the payment of the cheque amount. The said notices were received by the respondent-accused; though respondent acknowledged the receipt of the notices, he did not make the payment nor arranged that amount in satisfaction of the cheques issued by him. Hence, the complainant filed two complaints under Section 138 of the Negotiable Instruments Act as noted above.

6. Taking into account the receipts produced by the respondent-accused, the trial court acquitted the respondent-accused in both the cases. The trial court rejected the case of the appellant that the respondent sometimes used to purchase rice bags on credit and sometimes used to purchase rice bags on payment of cash and the same being inconsistent with the documents produced by the appellant. The trial court held that in the written complaint, the appellant-complainant has not alleged anywhere that the respondent used to make credit as well as cash purchases. The trial court held that the respondent left blank cheques with the appellant as security whenever he used to make credit purchases and therefore, the presumption under Section 139 of the Act is not available to the appellant.

7. In appeal, the High Court affirmed the acquittal of the respondent-accused and held that the respondent had taken the defence that the subject cheques were issued as security towards the goods supplied for which payment was subsequently made by cash. The High Court held that by producing the relevant receipts, the respondent has rebutted the presumption and that the respondent wa