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IN THE HIGH COURT AT CALCUTTA
ANANYA BANDYOPADHYAY, J.
Sri Somnath Paul – Appellant
Versus
Sri Debasish Dey & Anr. – Respondents
C.R.A. 79 of 2001
Decided on : 08-08-2024
Negotiable Instruments - Section 138, 139 - The court discussed the provisions of the Negotiable Instruments Act, particularly focusing on the necessity of service of demand notice under Section 138 and the presumption of liability under Section 139, concluding that failure to prove service of notice led to acquittal.
Fact of the Case:
The appellant filed a complaint under Section 138 of the Negotiable Instruments Act after a cheque issued by the opposite party was dishonoured due to insufficient funds. The opposite party claimed non-receipt of the demand notice.
Finding of the Court:
The court found that the prosecution failed to establish the service of the demand notice, which is a mandatory requirement under Section 138, leading to the conclusion that the accused was entitled to acquittal.
Issues: Whether the demand notice was properly served to the accused as required under Section 138 of the Negotiable Instruments Act.
Ratio Decidendi: The court emphasized that the burden of proof lies with the prosecution to establish the service of notice, and in its absence, the accused is entitled to acquittal.
Result: The appeal is allowed, and the order of acquittal is set aside.
JUDGMENT :
Ananya Bandyopadhyay, J.
1. This appeal is preferred against judgment and order of acquittal dated 11.08.2000 passed by the Learned Judicial Magistrate, 9th Court, Alipore in Case No. C-736/96 arising out of T.R.222/96 in a proceeding under Section 138 of the Negotiable Instruments Act, 1988.
2. The narrative of the complaint inter alia revealed that the appellant and the opposite party no.1 were acquainted with each other concerning sale and purchase of shawl. Out of the said business transaction Rs.1,60,000/-was to be paid by the opposite party no.1 to the appellant. On demand by the opposite party no.1 failed and neglected to pay the same. Lastly, on 06.03.1996 a salish was conducted and the opposite party no.1 in writing undertook to pay the said amount of money by installment and accordingly the opposite party no.1 issued a cheque of Rs.20,000/-, being Cheque No.200610 dated 06.03.1996 on Canara Bank, Gariahat Branch, Calcutta in favour of the appellant. The appellant deposited the said cheque at his account at Dena Bank, Kankulia Road Branch on 08.03.1996 for encashment but the said cheque was dishonoured and returned to the appellant with the remark “funds insufficient”. After receiving the said intimation from the bank, the appellant through his Learned Advocate issued notice on 15.03.1996 and demanded the said amount of money. The said notice was received on 18.03.1996 but in spite of that the opposite party no.1 failed and/or neglected to pay the said amount. The appellant subsequently filed the complaint to initiate a proceeding under Section 138 of the Negotiable Instruments Act bearing Case No. C-736/96.
3. The appellant examined himself as PW-1, PW-2 was Subhas Mazumdar, an Officer of Dena Bank, PW-3 was Shyamal Ghosh, Manager of Canara Bank, PW-4 Basudev Paul, whereas the opposite party examined none.
4. The Learned Magistrate on completion of trial, by judgment and order dated 11.08.2000 passed an order of acquittal in favour of the opposite party no.1.
5. The Learned Advocate for the appellant submitted that the provisions under Section 138 of the Negotiable Instruments Act as far as the issuance of demand notice was concerned, the appellant-petitioner complied with the same.
6. The Learned Advocate for the appellant-petitioner explained the elements of Section 138 and Section 142 of the Negotiable Instruments Act further indicating the notification issued by the Reserve Bank of India.
7. The Learned Advocate for the appellant relied on the following decisions:-
ii. State of M. P. v. Hira Lal reported in (1996) 7 SCC 523 as well as in Jagdish Singh v. Nathu Singh reported in AIR 1992 SC 1604.
iii. C.C. Alavi Haji v. Palapetty Muhammad & Anr. reported in (2007) 6 SCC 555.
iv. Sankar Finance and Investment v. State of A.P. & Others reported in (2008) 8 SCC 536.
v. Basalingappa vs. Muudibasappa (Criminal Appeal No. 636 of 2019).
vi. Rohitbhai Jivanlal Patel v. State of Gujarat reported in 2019 (5) SCALE 138.
vii. Hiten P Dalal v. Bratindranath Banerjee reported in (2001) 6 SCC 16.
8. It was further submitted that:-
ii. The Learned Chief Judicial Magistrate at Alipore had wrongly acquitted the accused person and his order of acquittal must be set-aside by the Hon'ble Court.
9. The Learned Advocate for the opposite party no. 1 opposed the contention o
The presumption of liability under Section 139 of the Negotiable Instruments Act can be rebutted if the accused proves non-receipt of the demand notice, which is essential for prosecution under Secti....
Presumption under Section 139 NI Act that cheque is for debt discharge holds unless rebutted by preponderance of probabilities; trial acquittal reversed for perversely ignoring defence witness confir....
The failure to provide evidence of sending a legal notice under Section 138 of the Negotiable Instruments Act invalidates the complaint, leading to acquittal.
The main legal point established in the judgment is the presumption in favor of the holder under Section 139 of the NI Act, the rebuttable presumption of consideration under Section 118(a), and the r....
A complainant's debt recovery under the Negotiable Instruments Act relies on established presumptions, rendering the accused's claims of improper notice or lack of financial capacity irrelevant unles....
Admission of cheque execution triggers Sections 118/139 NI Act presumptions of debt; burden on accused to rebut by evidence; trial acquittal ignoring presumption and shifting onus to complainant is p....
The main legal point established is that the failure to rebut the presumption under Section 139 of the Negotiable Instruments Act can lead to conviction under Section 138 of the Act.
The presumption under Section 139 of the NI Act mandates that a cheque is presumed to be issued for discharge of a debt unless the accused proves otherwise.
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