The burden of proof on the complainant to establish the ownership of the cheque amount and the accused's defense to create doubts about the existence of a legally recoverable debt or liability are crucial in cases under Section 138 of the Negotiable Instruments Act.

JUDGMENT :

Bankim N. Mehta, J.

The appellant, original complainant, has preferred this appeal under Section 378 of the Code of Criminal Procedure, 1973 and challenged the judgment and order of acquittal passed by learned Additional Civil Judge and Judicial Magistrate First Class, Gandhinagar, on 6.6.2008 in Criminal Case No. 5463 of 2005 acquitting the respondent accused for the offence under Section 138 of the Negotiable Instruments Act ("the Act" for short).

2. According to the complainant, the accused was former Secretary of Shreeji Prakashnagar Co-operative Housing Society Limited and had collected loan amount from the members of the Society and deposited in Ahmedabad District Co-operative Bank, Ahmedabad. Cheque No. 6768 dated 8.2.2005 for Rs.61,000/- was issued by Ahmedabad District Co-operative Bank towards commission to the accused which was presented in the Bank and was got encashed. Therefore, he informed the accused that the amount of commission given by the bank belonged to the Society and demanded the amount. Therefore, the accused informed that out of Rs.61,000/-, half of the amount was given to one Mr. V.K. Chaudhari and gave cheque No. 877419 dated 5.7.2005 for Rs.30,500/- drawn in the name of Shreeji Prakashnagar Cooperative Housing Society Limited, Chandkheda. On presenting the cheque in the Bank it returned unpaid with endorsement "stop payment". Therefore, notice dated 18.8.2005 was served to the accused. Despite that, the accused did not pay the unpaid cheque amount. Therefore, complaint was filed.

3. The trial Court issued summons to the accused who appeared and pleaded not guilty. Therefore, prosecution adduced evidence. On completion of recording of evidence further statement of the accused was recorded under Section 313 of the Code of Criminal Procedure. The accused in his further statement denied having committed the offence and stated that he had received the cheque in his personal capacity towards allowance under OTS scheme from Ahmedabad District Co-operative Bank but the complainant raised objection. Therefore, the cheque in question was given towards security till receipt of explanation from the Bank and therefore payment was stopped and no debt is outstanding against him. The accused also examined witness in his defence.

4. After hearing learned advocates for the parties, the trial Court by the impugned judgment acquitted the accused. Therefore, the complainant has preferred the present appeal.

5. I have heard learned advocate Mr. Hardik D. Muchhala for learned advocate Mr. Rajesh H. Sahjani for the appellant and learned advocate Mr. Hardik H. Pandit for learned advocate Mr. Brahmbhatt for the respondent accused- and learned A.P.P. Ms. C.M. Shah for the respondent State at length and in great detail. I have also perused the impugned judgment and record and proceedings of the trial Court.

6. Learned advocate Mr. Muchhala for the appellant submitted that the cheque in question was issued against outstanding debt as the accused had received amount of commission from the Bank which in fact belonged to the complainant society. However, the accused deposited the cheque in his personal account. He also submitted that though the cheque returned unpaid on account of stop payment, it is an offence and therefore the trial Court committed error in acquitting the accused. He relied on the decision in the case of M/S. Modi Cements Ltd. v. Kuchil Kumar Nandi Reported in AIR 1998 SC 1057.

7. Learned advocate Mr. Pandit for the respondent accused submitted that the complainant failed to prove that the amount of commission received by the accused belonged to the complainant. He also submitted that the cheque of commission was given in the name of the accused and therefore was entitled for encashment thereof. He also submitted that there was no legal due and therefore the trial Court was justified in acquitting the accused.

8. Under Section 139 of the Act it shall be presumed, unless contrary is proved, that the holder of