The court ruled that the presumption of legitimacy in cheque transactions places the burden on the accused to prove otherwise, highlighting the need for substantial evidence in defense claims of dishonor related to loan transactions.

ORDER :

J.M.KHAZI, J.

These two petitions filed under Section 397 r/w Section 401 of Cr.P.C are by the accused, wherein he has challenged the concurrent findings of the trial Court and Sessions Court convicting him for the offence punishable under Section 138 of Negotiable Instrument Act, (for short N.I.Act) and also the order of the Sessions Court enhancing the punishment.

2. Since these two petitions are arising out of the same judgment and order of the trial Court and common judgment and order passed by the Sessions Court, exercising the appeal jurisdiction and involve common discussion, they are clubbed together and disposed of by common order.

3. For the sake of convenience, parties are referred to by their ranks before the trial Court.

4. Complainant filed a complaint under Section 200 of Cr.P.C, against the accused for the offence punishable under Section 138 of N.I Act, contending that he and accused are known to each other since more than 10 years. On 15.09.2014, accused borrowed hand loan of Rs.3,88,000/- and it was paid by the complainant through cheque No.727282. Similarly, on 08.10.2015, accused borrowed sum of Rs.9,70,000/- and the said payment was made by the complainant through cheque No.063278. In this regard, accused also executed a hand loan agreement dated 08.10.2015. The accused had borrowed the said sums to improve his business and promised to repay the same within two years.

4.1 After expiry of two years, when accused failed to keep up his promise, on repeated request and demand by the complainant, accused issued cheque dated 19.01.2018 for total sum of Rs.13,58,000/- with an assurance that it would be honoured on presentation. However, on 19.01.2018, when complainant presented the cheque for encashment, it was returned dishonoured on the ground "funds insufficient". Immediately, complainant brought this fact to the notice of accused, but he didn't pay the amount due and went on dragging. Therefore, complainant got issued legal notice dated 29.01.2018 to both addresses of the accused. They are duly served on the accused. Instead of paying the amount due, the accused has sent an evasive reply without any alternative complaint is filed.

5. On service of notice, accused appeared through counsel and contested the case by pleading not guilty to the charge levelled against him.

6. In order to prove the allegations, the complainant examined himself as PW-1 and got marked Exs.P1 to 11.

7. During the course of the statement under Section 313 of Cr.P.C accused has denied the incriminating evidence by the complainant.

8. Accused has also given evidence as DW-1 and produced Exs.D1 to 9.

9. Vide the impugned judgment and order, the trial Court, convicted the accused and sentenced him to pay fine of Rs.13,63,000/- and out of it ordered for payment of Rs.13,58,000/- by way of compensation.

10. Aggrieved by the same accused approached the Sessions Court in Criminal Appeal No.476/2019. Complainant also challenged the said order in Criminal Appeal No.821/2019 seeking enhancement of the punishment.

11. Vide common judgment and order dated 18.04.2022, the Sessions Court dismissed the appeal filed by the accused and allowed the appeal filed by the complainant and enhanced the fine amount to Rs.18,05,000/- and out of it ordered for payment of compensation a sum of Rs.18,00,000/- to the complainant.

12. Aggrieved by dismissal of his appeal and allowing the appeal of the complainant by enhancing the fine amount, accused is before this Court contending that the Courts below have erred in convicting the accused ignoring the fact that the very amount said to have been paid by the complainant could be at no stretch of imagination excepted as a loan transaction. The Courts below ought to have accepted the defence of the accused. The complainant has claimed that accused has executed a loan agreement, the same is not produced. Since the accused has denied issuance of the cheque, the burden is on the complainant to prove the legality as held i