The complainant must prove the existence of a legally enforceable debt in a Section 138 NI Act case, and discrepancies in testimony can undermine the presumption of consideration.

JUDGMENT :

Rakesh Kainthla, J.

The present appeal is directed against the judgment dated 19.11.2010, passed by learned Judicial Magistrate First Class, Barsar, District Hamirpur (learned Trial Court), vide which, the complaint filed by the appellant (complainant before learned Trial Court) was dismissed. (Parties shall hereinafter be referred to in the same manner as they were arrayed before the learned Trial Court for convenience.)

2. Briefly stated, the facts giving rise to the present appeal are that the complainant filed a complaint before the learned Trial Court for the commission of an offence punishable under Section 138 of the Negotiable Istruments Act (in short ‘NI Act’). It was asserted that the parties were known to each other. The accused approached the complainant in February 2008 and requested him to advance a sum of Rs. 30,000/-as a loan. The complainant paid the amount to the accused. The accused issued a cheque for a sum of Rs. 30,000/-drawn on UCO Bank, Bijhari to discharge his legal liability. The complainant presented the cheque before his Bank, from where it was sent to the Bank of the accused; however, the cheque was dishonoured with an endorsement ‘insufficient funds’. The complainant sent a legal notice to the accused asking him to pay the amount within 15 days of the receipt of the notice. The notice was duly served upon the accused, but the accused failed to pay the amount; hence, the complaint was filed before the Court for taking action against the accused as per the law.

3. The learned Trial Court found sufficient reasons to summon the accused. When the accused appeared, a notice of accusation was put to him for the commission of an offence punishable under Section 138 of the NI Act, to which he pleaded not guilty and claimed to be tried.

4. The complainant examined three witnesses to prove his case. Ranjeet Singh (CW1) is the complainant, Ashok Thakur (CW2) is the banker of the complainant, and PK Saini (PW3) is the banker of the accused.

5. The accused in his statement recorded under Section 313 of Cr.P.C. denied the prosecution's case in its entirety. He claimed that he had handed over the cheque to Ashok Kumar, son of Amar Nath, in lieu of purchasing the vehicle. He stated that he wanted to lead the defence evidence, but no evidence was led.

6. Learned Trial Court held that the complainant did not specify the date on which the accused approached him to take a loan. He failed to mention the source from which he had taken the money. He stated in his cross-examination that the cheque was handed over on the same day on which the loanwas advanced. This falsifies the version of the complainant that the loan was advanced in February 2008, since the cheque was issued on 15.03.2008. The burden was upon the complainant to show that he had advanced the money to the accused, but he failed to discharge this burden. Consequently, the learned Trial Court acquitted the accused.

7. Being aggrieved by the judgment passed by learned Trial Court, the accused has filed the present appeal, asserting that the learned Trial Court erred in acquitting the accused. Provisions of Sections 139 and 118 of the NI Act were not properly appreciated, therefore, it was prayed that the present appeal be allowed and the judgment passed by the learned Trial Court be set aside.

8. I have heard Mr. Udit Shaurya Kaushik, learned counsel for the appellant/complainant and Mr. Sumeet Raj Sharma, learned counsel for the respondent/accused.

9. Mr. Udit Shaurya Kaushik, learned counsel for the appellant/complainant, submitted that the learned Trial Court erred in dismissing the complaint. It was wrongly held that the burden is upon the complainant to prove the source of funds. Learned Trial Court overlooked the presumption contained in Sections 118 and 139 of the NI Act; therefore, he prayed that the present appeal be allowed and the judgment passed by the learned Trial Court be set aside. He relied upon the judgment of the Hon’ble Supreme Court in T