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SUPREME COURT OF INDIA
K.M. JOSEPH, HRISHIKESH ROY, JJ.
Tedhi Singh - Appellant
Versus
Narayan Dass Mahant - Respondent
Criminal Appeal No.362 of 2022 (Arising out of SLP (Crl) No.1963 of 2019)
Decided on : 07-03-2022
(A) Negotiable Instruments Act, 1881 – Sections 138 and 139 – Dishonour of cheque – It is open accused to establish that there is no consideration received – All which accused needs to establish is a probable defence – As to whether a probable defence has been established is a matter to be decided on facts of each case on conspectus of evidence and circumstances that exist – Accused has right to demonstrate that complainant in a particular case did not have capacity and case accused is acceptable which he can do by producing independent materials – It is also open to him to establish very same aspect by pointing to materials produced by complainant himself – Appellant has not established a case for interference with finding of Courts below that offence under Section 138 N. I. Act stands committed by appellant – Amount of compensation in a sum of Rs.7 Lakhs which is relatable to cheque amount has been deposited already in Trial Court – However, appellant should be granted relief in form of substitution of sentence of imprisonment of one year with a fine – Amount of Rs.5,000/- is an amount which should suffice as substitution for the imprisonment. Apart from that, we would also direct that a further amount of Rs.15,000/- shall be paid as compensation to the respondent. (Paras 7, 9 and 12)
(B) Constitution of India – Article 136 – Appellate Jurisdiction – Apex Court even exercising power under Article 136 of Constitution may not refuse to interfere in a case where three Courts have gone completely wrong – Jurisdiction generated in appeal under Article 136 is rare and extraordinary – Article 136 of Constitution only confers right to obtain special leave in rare and extraordinary cases. (Para 11)
Facts of the case:
Appellant calls in question the judgment of the High Court by which it dismissed the Criminal Revision No.129 of 2018 filed under Section 397 of the Code of Criminal Procedure, 1973 against the order of the Sessions Judge by which the Court in turn affirmed the order passed by the Chief Judicial Magistrate. The Chief Judicial Magistrate found the appellant guilty of having committed the offence under Section 138 of the Negotiable Instruments Act, 1881. The appellant stands sentenced to simple imprisonment for a period of one year. Further, the appellant is called upon to pay a compensation of a sum of Rs.7 Lakhs.
Findings of Court:
Sentence of imprisonment of one year shall stand vacated. However, the appellant shall stand sentenced to fine of Rs.5,000/- which he will deposit within a period of one month from today in the Trial Court. In case of default, the appellant shall undergo simple imprisonment for a period of one month. The appellant shall also deposit a sum of Rs.15,000/- as further compensation which can be withdrawn by the respondent. The deposit shall be made in the Trial Court within a period of four weeks from today.
Result : Appeal Partly allowed.
JUDGMENT :
K.M. JOSEPH, J.
Leave granted.
2. The appellant calls in question the judgment of the High Court by which it dismissed the Criminal Revision No.129 of 2018 filed under Section 397 of the Code of Criminal Procedure, 1898 (for short ‘Cr.P.C.) against the order of the Sessions Judge by which the Court in turn affirmed the order passed by the Chief Judicial Magistrate. The Chief Judicial Magistrate found the appellant guilty of having committed the offence under Section 138 of the Negotiable Instruments Act, 1881 (for short ‘N.I. Act.’). The appellant stands sentenced to simple imprisonment for a period of one year. Further, the appellant is called upon to pay a compensation of a sum of Rs.7 Lakhs.
3. The complaint of the respondent was based on the allegation that in the month of August, 2011 the appellant was in urgent need of money and out of friendship he gave a sum of Rs.7 Lakhs and the cheque given by the appellant was dishonored. In the trial, following the complaint the appellant examined DW-1 to DW-4. They are Officers of four Banks. This was done by the appellant in an attempt at putting up what can be described in the words of the learned counsel for the appellant ‘a probable defence’. It was an attempt by the appellant to show that the version of the complainant that he had the financial wherewithal to advance a loan of Rs.7 Lakhs was not to be accepted. This is the matter which has been agitated by Ms. Sangeeta Bharti, learned counsel for the appellant. She would, in fact, complain that in the impugned judgment, the High Court has observed that it is not known as to what is the purpose for which DW-1 to DW-4 have been examined. It is appellant’s case that the finding would clearly help the appellant advance the contention that this is a case where the High Court as also the two Courts have not appreciated the law which is laid down in regard to the effect of a ‘probable defence’. She drew our attention to the judgment of this Court in Basalingapa Vs. Mudibasappa reported in (2019) 5 SCC 418. This Court, inter alia has held as follow:-
25.1. Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.
25.2. The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities.
25.3. To rebut the presumption, it is open for the accused to rely on evidence led by him or the accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely.
25.5. It is not necessary for the accused to come in the witness box to support his defence.”
4. She would therefore, point out in the facts of this case when the complainant was cross-examined, he had stated that the transaction took place on a particular date, namely, 5th of August, 2011 and he also deposed as follows:-
Dishonour of cheque – It is open accused to establish that there is no consideration received – All which accused needs to establish is a probable defence – As to whether a probable defence has been ....
Cheque for time-barred debt not liable under Section 138 NI Act; Sections 118/139 presumption rebutted by prior stop payment on lost cheque and lack of financial capacity proof; acquittal interferenc....
The accused's failure to raise a probable defense or contest the existence of a legally enforceable debt or liability triggers the statutory presumption under Section 139 of the Negotiable Instrument....
The burden is on the complainant to prove financial capacity when questioned; a mere presumption does not suffice if evidence is lacking.
The presumption of consideration and debt under Sec. 118 and 139 of the N.I. Act places the burden on the accused to disprove the existence of a debt once the cheque is admitted, and the complainant'....
The presumption under Section 139 of the Negotiable Instruments Act is rebuttable; the burden shifts to the complainant to prove existence of debt when the accused raises a probable defense challengi....
The main legal point established in this judgment is that under Section 139 of the Negotiable Instruments Act, there is a presumption that a cheque is issued for the discharge of a debt or liability.....
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