DELHI HIGH COURT
Ashutosh Kumar, J.
Devender Kumar —Petitioner
versus
Khem Chand —Respondent
Crl.Rev.P.No.679 of 2012
Decided on 6.10.2015

IMPORTANT POINTS
(1) Section 139 of N.I. Act is an example of reverse onus clause which requires the accused to raise a probable defence for creating doubt about the existence of a legally enforceable debt or liability for thwarting the prosecution. The standard of proof for doing so would necessarily be on the basis of “preponderance of probabilities” and not “beyond shadow of any doubt.
(2) Section 378 (4) of the Cr.P.C. would apply not only to an original order of acquittal in a case of complaint but also to an order of acquittal passed by the Sessions Court in appeal.

Headnote:(i) Negotiable Instruments Act, 1881 — Section 138 and 139 — Dishonour of cheque stated to have been issued in discharge of friendly loan — Acquittal by Sessions Court in appeal on findings that loan agreement did not contain any acknowledgement of disbursement of loan and that loan transaction had not been mentioned by complainant in his income tax returns — Revision — Presumption in favour of payee/holder that cheque is issued in discharge of debt of liability — Presumption was rebuttable but accused may not be expected to discharge an unduly high standard of proof — Reverse onus clause required accused to raise a probable defence for creating doubt about existence of a legally enforceable debt or liability — For not showing the loan in ITR return an adverse inference could be drawn against petitioner — Respondent had sent legal notice to complainant for return of blank signed cheque and though complainant-petitioner had sent reply fact was not effectively denied — Accused could be said to have rebutted presumption of existence of a legally enforceable debt by establishing that no loan was advanced to him — Acquittal was not to be interfered with.

       Held: In Rangappa vs. Sri Mohan (Supra), section 139 of the NI Act is stated to be an example of a reverse onus clause which is in tune with the legislative intent of improving the credibility of negotiable instruments. Section 138 of the NI Act provides for speedy remedy in a criminal forum, in relation to dishonour of cheques. Nonetheless, the Supreme Court cautions that the offence under Section 138 of the NI Act is at best a regulatory offence and largely falls in the arena of a civil wrong and therefore the test of proportionality ought to guide the interpretation of the reverse onus clause. An accused may not be expected to discharge an unduly high standard of proof. A reverse onus clause requires the accused to raise a probable defence for creating doubt about the existence of a legally enforceable debt or liability for thwarting the prosecution. The standard of proof for doing so would necessarily be on the basis of “preponderance of probabilities” and not “beyond shadow of any doubt”.

       Keeping the above proposition of law in mind, on an analysis of fact, the scale of balance tills in favour of the respondent. The respondent appears to have rebutted the presumption under Section 139 of the NI Act, namely, the existence of a legally enforceable debt by establishing that no loan was advanced to him even though there was an agreement and a corresponding promissory note and an affidavit. The aforesaid loan was not shown in the ITR return of the petitioner. An adverse inference could be drawn against the petitioner on that account. The loan amount also appears to be doubtful.

       The petitioner could not, on the other hand, satisfy the requirement of law in discharging onus in the second instance regarding the plea of the respondent of no liability or non-existence of a legally enforceable debt. The advance of loan of such amount is required to be disclosed under the ITR return (referred to Section 269 SS of the Income Tax Rules and Section 271 D of the Income Tax Act.)

       The respondent had sent a legal notice to the petitioner on 14.07.2009, regarding return of the blank signed cheques which were admittedly received by the petitioner. The petitioner has stated that he replied the notice on 28.07.2009. In the notice sent to the petitioner by the respondent on 14.07.2009, there is a clear and categorical plea that he had taken a loan of Rs.17,000/- only, to be payable in 17 installments of Rs.1,510/- each with an interest @ 3% p.m. However, such fact was not effectively denied nor there was any reference of the same in the reply of the said notice by the petitioner.

       Thus, for the reasons afore recorded, viz. the successful rebuttal of the presumption under Section 139 of the NI Act of any legally enforceable debt, and the petitioner failing in discharging his onus, in the second instance, the petition is dismissed and the appellate judgment and order dated 12.09.2012, passed in Criminal Appeal No. 60/2012 is affirmed. (Paras 21 to 24 & 39)

       (ii) Criminal Procedure Code, 1973 — Section 378(4) and 401 — Judgment of acquittal by Sessions Court in appeal — Revision by complainant — Maintainable — Section 378(4) CrPC would apply not only to an original order of acquittal in a case of complaint but also to an order of acquittal passed by Sessions Court in appeal.

       Held: I am, therefore, of the opinion that Section 378 (4) of the Cr.P.C. would apply not only to an original order of acquittal in a case of complaint but also to an order of acquittal passed by the Sessions Court in appeal. There is nothing in Section 378 (4) of the Cr. P.C. to limit its application only to the order of acquittal passed in the first instance by the Trial Court.

       Sub-Clause (4) of Section 401 of Cr.P.C. provides that when an appeal is provided for and no such appeal is filed, no proceeding by way of revision shall be entertained at the instance of the party, who could have appealed. Sub-clause 5, however, permits the High Court on its satisfaction about the interest of justice to treat the application of revision as petition of appeal and deal with the same accordingly.

       There is, yet, another grey area. The question which disturbs this Court is whether to give benefit of sub-section (5) of Section 401 of the Cr.P.C. in the absence of any such leave to appeal having been granted. Any appeal against an order of acquittal is permissible only after the leave to appeal is accorded and not otherwise. Leaving this issue open, I am inclined to entertain the aforesaid revision as if it were an appeal after the grant of leave as mandated under Section 378(4) of the Cr.P.C.

       This is for the twin reasons that the present revision petition has been entertained for a long time since 2012 and for the adherence to the principle of apices juris non sunt jura (legal principles must not be carried to their utmost extreme consequences, regardless of equity and good sense). (Paras 33, 36 to 38)

       Result: Revision dismissed.