IMPORTANT POINT
If some material is brought on record by accused consistent with his innocence, accused is entitled for order of acquittal.

A.P. Bhangale, J.—The instant appeal is by the Complainant directed against the Judgment and Order, dated 16th April, 2008 passed by the learned Judicial Magistrate, First Class (Court No.VI), Akola challenging the acquittal of the respondent/accused under Section 138 of the Negotiable Instruments Act.

2. The facts, briefly stated, are as under:-

The Complainant and the accused were in cordial terms with each other. In the month of April, 2004, the accused demanded a sum of Rs.1,00,000/- from the Complainant as he was in dire need of money. The amount was paid in cash on 19/04/2004. The accused had issued a Cheque bearing no.351152, dated 04/10/2004 for the sum of Rs.95,000/- drawn upon the Akola Janata Commercial Co-operative Bank Ltd., Akola Branch. The cheque when presented for realisation, was returned dishonoured with remarks “fund insufficient” vide intimation memo, dated 05/10/2004. The demand notice was issued by R.P.A.D. and under postal certificate. It was duly received by the accused on 03/1112004. The accused failed to pay the amount. Thus, a complaint was lodged. The trial Magistrate acquitted the accused.

3. The accused had denied the transaction. He stated that he never issued the cheque in the sum of Rs 1,00,000/-. The accused defended the proceedings on the ground that he had given the blank Cheque duly signed (Ex.30) to Ramesh (AW-2). The defence of the accused was found reasonable and probable. The accused had led the defence evidence. The trial Court relied upon the evidence of Ramesh (AW-2).

4. No documentary evidence was tendered by the Complainant to show whether the sum of Rs. 1,00,000/- was paid in cash to the accused. No entry was taken in the accounts regarding the amount advanced by way of loan. The cash transaction was also exceeding the limit of sum of Rs 20,000/- as may be permissible under the Income Tax Act.

5. In such a case, if some material is brought on record by the accused consistent with innocence of the accused, which appears true and reasonable and accepted in rebuttal to the statutory presumption and the material brought on record by the accused passes the test of preponderance of probability, the case of the complainant may be rendered doubtful and then, on the basis of probability of defence, the accused is entitled for an order of acquittal.

6. In the ruling in Rangappa v. Mohan1 (three Judges Bench), the Apex Court observed the legal position thus:-

“14. The presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat (supra) may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant. Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused/defendant ca