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2025 Supreme(Guj) 1064

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
S.V. PINTO, J.
Mas Financial Services Limited - Appellant 
Versus
State Of Gujarat & Anr. - Respondent 
R/Criminal Appeal (Against Acquittal) No. 1798 of 2016
Decided on : 08-04-2025


Advocates:
Advocate Appeared:
For the Appellant : TIRTH NAYAK
For the Respondent: Ms. Dhwani Tripathi, APP

In acquittal appeals, the appellate court respects the presumption of innocence and can only overturn a trial court's acquittal if it is perverse or based on a misreading of evidence.

Headnote:

(A) Code of Criminal Procedure, 1973 - Section 378(4) - Negotiable Instruments Act, 1881 - Section 138 - Appeal against acquittal - The appellant challenged the acquittal of the accused for dishonoring a cheque issued for a loan of Rs. 45,000/- which was not repaid. The cheque was returned due to insufficient funds, and the complainant's statutory notice was served but ignored. The trial court acquitted the accused, finding the evidence insufficient to prove a legally enforceable debt. (Paras 1, 2, 11, 12)

(B) Presumption of Innocence - The appellate court must respect the presumption of innocence and can only interfere with acquittal if the trial court's judgment is perverse or based on a misreading of evidence. (Paras 8, 12)

(C) Burden of Proof - The presumption under Section 139 of the N.I. Act is rebuttable, and the accused can raise a probable defense to contest the existence of a legally enforceable debt. (Paras 10, 11)

Facts of the case:
The complainant alleged that the accused failed to repay a loan and issued a cheque that bounced. The trial court found the evidence insufficient to establish a legally enforceable debt.

Findings of Court:
The trial court's acquittal was upheld as it properly appreciated the evidence and found no compelling reasons to overturn the acquittal.

Issues: The main issues were whether the trial court misread the evidence and if the acquittal was justified.

Ratio Decidendi: The appellate court reaffirmed that it cannot interfere with acquittal unless the trial court's findings are perverse or unsupported by evidence.

Result: Appeal dismissed.

JUDGMENT :

S.V. PINTO, J.

1. The present appeal is filed by the appellant – original complainant under Section 378(4) of the Code of Criminal Procedure, 1973 against the judgment and order of acquittal dated 02.06.2016 passed by the learned 4th Additional Chief Judicial Magistrate, Palanpur in Criminal Case No. 5104 of 2014, whereby the respondent No. 2 - original accused came to be acquitted from the offence under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as ‘the N I Act”).

1.1 The parties are hereinafter referred to as “the complainant” and “the accused” as they stood in the original case for the sake of convenience, clarity and brevity.

2. The brief facts culled out from the memo of the present appeal as well as the impugned judgment and order and paper book filed by the complainant are as under:

2.1 The complainant filed a complaint against the accused under Section 138 of the N.I.Act as the accused had taken a loan of Rs. 45,000/- and agreement No.241698 was executed. As per the agreement, the accused had to pay the amount of loan in regular installments, but the same were not paid and the accused cancelled the loan and gave cheque No.403900 dated 22.12.2012 for Rs. 26,700/- of his account with HDFC Bank, Palanpur. The cheque was deposited in the bank of the complainant for clearing, but the same returned unpaid on 24.12.2012 with the endorsement “Funds Insufficient”. The complainant gave the statutory demand notice through his advocate on 22.01.2013 which was duly served on 29.01.2013, but the accused did not repay the amount, and hence, the complainant filed the complaint under Section 138 of the N I Act before the Court of the Chief Judicial Magistrate, Palanpur.

2.2 The accused was duly served with the summons and appeared before the learned Trial Court and his plea was recorded at Exhibit 07 and the evidence of the complainant was taken on record. The complainant was examined on oath and 08 documentary evidences were produced in support of his case.

2.3 After the closing pursis was filed by the complainant at Exhibit 26, the further statement of the accused under Section 313 of the Code of Criminal Procedure was recorded, wherein the accused stated that the facts in examination in chief and in the complaint are false and a false complaint has been filed. The accused refused to step into the witness box and after the arguments of the learned advocates for both the parties were heard, by the impugned judgment and order, the learned Trial Court acquitted the accused from the offence under Section 138 of the N I Act.

3. Being aggrieved and dissatisfied with the same, the complainant has preferred the present appeal mainly stating that the learned Trial Court has not properly interpreted the evidence and has misread the evidence and the impugned judgment and order is perverse, erroneous and contrary to law.

4. Heard learned Advocate Mr. Tirth Nayak appearing for the appellant and learned APP Ms. Dhwani Tripathi for the respondent – State. Though served the respondent No. 2 has not remained present either in person or by an advocate. Perused the impugned judgment and order of acquittal and have re-appreciated the entire evidence of the prosecution on record of the case.

5. Learned Advocate Mr. Tirth Nayak appearing for the appellant has taken this Court through the entire evidence produced by the prosecution and has vehemently argued that the learned Trial Court has not appreciated the evidence properly and the complainant has produced cogent evidence to prove the case and has successfully proved the case against the accused but the learned Trial Court has not considered the same and has acquitted the accused. The judgment and order of acquittal passed by the learned Trial Court is contrary to law, evidence on record and principles of justice. The judgment and order of acquittal passed by the learned Trial Court is based on inferences, not warranted by facts of the case and also on presumption, not

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