Back
IN THE HIGH COURT AT CALCUTTA
SHAMPA DUTT (PAUL), J.
Sri Raju Saha – Appellant
Versus
The State of West Bengal & Anr. - Respondents
CRA 403 of 2018
Decided On : 21-05-2024
Negotiable Instruments - Section 138, 139 - The court emphasized the presumption of a legally enforceable debt under Section 139, highlighting the burden on the accused to rebut this presumption, which was not met in this case, leading to the conviction.
Fact of the Case:
The petitioner provided an interest-free loan to the respondent, who issued four cheques to repay the loan. The cheques were dishonored due to insufficient funds, and the petitioner filed a complaint under Section 138 of the Negotiable Instruments Act after the respondent failed to pay despite a demand notice.
Finding of the Court:
The trial court acquitted the respondent, stating the debt was not legally enforceable as the petitioner did not provide evidence of money lending authority or tax documentation. The appellate court found this reasoning flawed, as the presumption under Section 139 was not rebutted.
Issues: Whether the presumption of a legally enforceable debt under Section 139 of the Negotiable Instruments Act was effectively rebutted by the respondent.
Ratio Decidendi: The court held that the presumption of a legally enforceable debt under Section 139 is rebuttable, but the accused must provide sufficient evidence to disprove the existence of the debt, which was not done in this case.
Result: The appeal is allowed, the acquittal is set aside, and the respondent is convicted under Section 138 of the Negotiable Instruments Act.
JUDGMENT :
(Shampa Dutt (Paul), J.) :
The Appeal:-
1. The present appeal has been preferred against a judgment and order dated May 15, 2018 passed by the Learned Metropolitan Magistrate, 5th Court, Calcutta in Case No. C- 11283 of 2014, TR No. 381 of 2014 under Section 138 of the Negotiable Instruments Act.
The Prosecution:-
2. Due to financial scarcity, the petitioner gave interest free accommodation loan to the respondent No.2 and the respondent No.2 issued four cheques to discharge his liability against the said accommodation loan. The Respondent No.2 issued cheque No. 756742 dated February 10, 2014 of Rs. 2,00,000/-; Cheque No. 042350 dated February 10, 2014 of Rs 1,00,000/-; Cheque No. 756750 dated February 12, 2014 of Rs. 1,00,000/- and Cheque No. 756754 dated February 12, 2014 of Rs. 90,000/- total amounting to Rs. 4,90,000/-. All Cheques were drawn on ICICI Bank Ltd., R.N. Mukherjee Road Branch, Kolkata, in favour of the petitioner and the petitioner deposited the Cheques with Indian Overseas Bank, Strand Road Branch, Kolkata for encashment but the Cheques were returned with the remark ‘Fund Insufficient’ as per Bank Memo dated February 15, 2014. The petitioner sent a demand notice dated February 25, 2014 and the said notice was served upon the respondent on February 26, 2014 but the respondent No. 2 failed and neglected to make the payment. Accordingly, the Respondent No.2 committed an offence punishable under Section 138 of the Negotiable Instruments Act.
3. The petitioner submits that the Learned Magistrate passed an order of acquittal, on the ground that the debt is not legally enforceable against the accused person because the complainant did not produce any document to show that the said amount of loan was shown in the Income Tax file.
4. The petitioner submits that the Learned trial Court passed the order of acquittal on the ground that the complaint did not produce any document to show that he has money lending authority.
5. The petitioner submits that the respondent No.2 issued the cheques in question to discharge his enforceable liability which was dishonored. Thereafter, the petitioner issued demand notice, which was received by the respondent No.2 but he failed to make the payment thereof. Thus, the respondent No.2 failed to rebut the presumption under Section 139 of the Negotiable Instruments Act.
6. On completion of trial, the Respondent/accused was acquitted by the trial Court.
The Evidence:-
7. The complainant has examined himself as P.W.1 and duly proved Exhibit 1 series, the cheques (4) in this case.
8. Exhibit 2 is the cheques return memo showing that all the cheques were dishonored for “insufficient funds”.
9. Exhibit 3 is the deposit slip.
10. Exhibit 4, Demand Notice.
11. Exhibit 5 is the postal receipt.
12. Exhibit 6 is the Acknowledgement and Track Report showing due service of notice.
13. Exhibit 7 series are documents supporting the Complainant/Appellant’s case that, he had given loan of the amount as stated in this case to the Respondent/Accused and in discharge of his said liability, the cheques were issued by the Respondents, which on presentation were dishonoured and in spite of valid demand notice being served, the amount of the cheques was not repaid to the Appellant herein.
Analysis of Evidence:-
14. The Respondent/Accused’s wife deposed as Defence Witness 1, she has admitted the loan taken by her husband, but has deposed that the said loan was repaid. No documents has been placed and proved in support of such alleged repayment.
Conclusion:-
15. The relevant findings of the trial Court dismissing the case of the Appellant/Complainant and acquitting the Respondent/Accused are as follows:-
The materials on record reveals that the complainant as PW-1 did not produce any document to show that the said amount of loan was shown in his Income Tax file. It i
The presumption under Section 139 of the Negotiable Instruments Act is rebuttable, and the burden of proof lies on the accused to provide a probable defense.
Dishonour of cheque – Whereas prosecution must prove guilt of an accused beyond all reasonable doubt, standard of proof so as to prove a defence on part of accused is preponderance of probabilities.
(1) Dishonour of cheque – Proceedings under Section 138 of N.I. Act are quasi-criminal in nature and principles which apply to acquittal in other criminal cases are not applicable in cases instituted....
The presumption in favor of the complainant under the N.I. Act is rebuttable, and the standard of proof required to prove a defense in a criminal case is preponderance of probabilities.
The presumption under Section 139 of the Negotiable Instruments Act is mandatory, placing the burden on the accused to rebut the existence of a legally enforceable debt.
The presumption under Section 139 of N.I. Act is a presumption of law, as distinguished from the presumption of facts. Presumptions are rules of evidence and do not conflict with the presumption of i....
The issuance of a cheque carries a presumption of consideration, which is rebuttable by the accused. Failure to prove the non-existence of a debt results in liability under Section 138 of the NI Act.
The presumption of liability under the NI Act is rebuttable, and the burden of proof lies on the complainant to establish the existence of a legally enforceable debt.
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
