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2014 Supreme(Mad) 3555
High Court of Judicature at Madras
M. VENUGOPAL, J.
A. Thayalan
Versus
S.S. Mani
Criminal Appeal Nos.483 & 484 of 2008
Decided on: 08-10-2014
For the Appellant:L. Rajasekar, Advocate.
For the Respondent:G.S. Selvatharasu, Advocate.
Headnote:
NEGOTIABLE INSTRUMENTS ACT - SECTION 138 - REBUTTAL OF PRESUMPTION - LEGALLY ENFORCEABLE DEBT - BURDEN OF PROOF - STANDARD OF PROOF - INCHOATE STAMPED INSTRUMENTS - SECTION 20 - FILLING UP OF BLANK CHEQUE - AUTHORITY TO HOLDER - MATERIAL ALTERATION - FABRICATION OR FORGERY - SECTION 118 - PRESUMPTIONS - EXECUTION OF INSTRUMENT - SECTION 5, 6, 20, 118 AND 139 - INTERPRETATION - DOCTRINE OF REVERSE BURDEN - SECTION 139 - APPLICABILITY - SECTION 34 OF THE INDIAN EVIDENCE ACT, 1872 - ADMISSIBILITY OF ENTRIES IN BOOKS OF ACCOUNTS.
Fact of the Case:
The Appellant/Complainant preferred the instant Criminal Appeals before this Court as against the Judgment of Acquittal in C.C.Nos.5353 & 5354 of 2005, dated 20.05.2008 passed by the Learned XVIII Metropolitan Magistrate, Saidapet, Chennai.
Finding of the Court:
The trial Court had committed an error in acquitting the Accused, which is against Law and weight of Evidence and the Principles of Natural Justice. The evidence of P.W.1/Complainant and cross examination made by the Respondent/Accused along with the evidence of D.W.2 were ignored. There was no effective cross examination of P.W.1 by the Learned Counsel for the Respondent/Accused as to the main ingredient of Section 138 of the Negotiable Instruments Act, viz., legally enforceable debt. The evidence of D.W.1 and D.W.2 is contradicting with each other. Further, the evidence of D.W.2 was against the stand taken by the Accused in the cross examination of P.W.1. The trial Court should have taken note of an important fact that there was no dispute about the instruments Ex.P.1 (in C.C.No.5353/2005), Ex.P.1 and P.2 (in C.C.No.5354/2005) and the Respondent/Accused was not disputing the signature or the issuance of cheques. The trial Court had not borne in mind the essential ingredients relating to the rebuttal of presumption under Section 138 of the Negotiable Instruments Act, 1881. Also, it took into consideration the extraneous factors and materials to record a 'Finding of Acquittal'. The Respondent/Accused had not cross examined P.W.1 in regard to the issuance of Cheques - Ex.P.1, Ex.P.1 & P.2, the signatures therein or the amount in the said Cheques and in fact, the Respondent/Accused in his chief examination had admitted that he had issued three cheques (Exs.P.1, P.1 & P.2 in these cases) to the Complainant during 2004 and that the Respondent/Accused, in his cross examination, had put a question to the Appellant/Complainant that Exs.P.1, P.1 & P.2 – Cheques were taken from him in regard to the land transaction between one Mukundan and the Appellant/ Complainant, for which, the Appellant/Complainant had replied in the negative. The Respondent/Accused, in his Reply Notice (Ex.P.6 in C.C.No.5353/2005) dated 17.05.2005, had stated that the cheques were collected by the Appellant/Complainant under duress and misused the same. On the side of Respondent/Accused, no suggestion was put to the Appellant/Complainant in regard to the purported Panchayat said to have been taken place as projected by him. The Respondent/Accused had taken three different stands in his defence to escape from the liability. D.W.2, in his evidence (in cross examination), had deposed that he conducted Panchayat but does not remember the date, the names of persons attended the Panchayat, the cheque numbers etc. That apart, he had admitted that the Panchayat decision was reduced into writing, but he had not produced any document to show that the Panchayat was conducted. Moreover, D.W.2 in his evidence (in cross examination) had admitted that he was not aware of the loan transaction between the Appellant and the Respondent/Accused. The evidence of D.W.1 does not merit acceptance since his evidence was unworthy of credence. P.W.1 (Appellant/Complainant), in his cross examination, had stated that there was no connection in regard to the Mukundan's land case and the present cases in question. The Respondent/Accused filed a petition before the trial Court to call one Mukundan as witness on his side, but failed to examine him and in reality, no documents were marked in regard to the alleged loan transaction between the said Mukundan and the Appellant/ Complainant. Even during the examination of Respondent/Accused under Section 313 Cr.P.C., he only denied the offence and made no endeavour to elucidate his defence pleas.
Issues: None
Ratio Decidendi: The Appellant/Complainant had not proved his two cases in C.C.Nos.5353 & 5354/2005 that the cheques in issue were given by the Respondent/Accused towards the discharge of his liability in respect of the loan or debt. In short, the Appellant/Complainant had not proved that (in the two cases) the existence of any 'Legally Enforceable Debts or Liabilities' for issuance of cheques. Consequently, the Appeals fail.
Final Decision: The Criminal Appeals are dismissed.
Based on the provided legal document, here are the key points:
- Case Details: The case involves Criminal Appeals (Nos. 483 & 484 of 2008) filed by the Appellant/Complainant against a Judgment of Acquittal passed by the Learned XVIII Metropolitan Magistrate, Saidapet, Chennai, on 20.05.2008 in C.C. Nos. 5353 & 5354 of 2005 (!) [21001137610001].
- Core Issue: The primary issue is whether the Complainant proved the existence of a "Legally Enforceable Debt or Liability" for the issuance of the cheques, which is a prerequisite for conviction under Section 138 of the Negotiable Instruments Act (!) (!) [21001137610003].
- Trial Court's Findings: The trial court acquitted the Accused because the Complainant failed to prove that the cheques were given to discharge a legally enforceable liability or loan. The court noted contradictions in the versions of both the Complainant and the Accused regarding the issuance of cheques and the underlying liability (!) (!) [21001137610007].
- Complainant's Claims: The Appellant claimed the Accused borrowed Rs. 6,50,000/- in August and September 2003 for purchasing land from a third party (Mukundan) and issued three cheques (Ex.P.1, P.1, P.2) totaling Rs. 5,95,000/- as repayment (!) (!) [21001137610028][21001137610030] (!) .
- Accused's Defense: The Respondent/Accused denied taking any loan. He claimed the cheques were obtained under duress and misused by the Complainant after the Complainant lost the property rights due to a criminal case involving Mukundan and the seizure of the Power of Attorney (!) (!) (!) (!) .
- Contradictions in Evidence:
- Dates: There was a discrepancy regarding the dates of cheque issuance; the Accused claimed they were given in 2004, while the Complainant's evidence suggested a timeline inconsistent with the cheque dates (2004-2005) (!) (!) (!) (!) .
- Loan Amount: The Complainant admitted to not receiving cheques for the full borrowed amount and not obtaining a promissory note for the balance, which is an adverse circumstance (!) (!) .
- Witness Testimony: The evidence of D.W.1 (Accused) and D.W.2 was found contradictory. D.W.2 admitted he was unaware of the loan transaction and could not recall details of the Panchayat he claimed to have conducted (!) (!) (!) .
- Rebuttal of Presumption: The Accused successfully rebutted the presumption under Section 139 of the Negotiable Instruments Act by placing on record that there was no legally enforceable debt. The Complainant failed to discharge the initial burden of proof (!) (!) (!) (!) .
- Books of Accounts: The Complainant failed to produce Income Tax Returns or business books showing entries for the alleged loan of Rs. 6,50,000/-, despite claiming to be in the real estate business and paying income tax. This lack of documentary evidence undermined his claim of a valid loan (!) (!) (!) (!) .
- Legal Notices: The Legal Notice issued by the Complainant (Ex.P.4) initially stated the cheques were for loan repayment, but a subsequent notice (Ex.P.7) claimed they were for discharge of liability in a land transaction. This inconsistency highlighted the lack of clarity in the Complainant's case (!) (!) (!) .
- Final Decision: The High Court held that the Complainant failed to prove the existence of any legally enforceable debt or liability. Consequently, the Criminal Appeals were dismissed, and the acquittal of the Accused was upheld (!) (!) (!) .
1. The Appellant/Complainant has preferred the instant Criminal Appeals before this Court as against the Judgment of Acquittal in C.C.Nos.5353 & 5354 of 2005, dated 20.05.2008 passed by the Learned XVIII Metropolitan Magistrate, Saidapet, Chennai.
The Observations of the trial Court in the impugned Judgments:
2. The Learned XVIII Metropolitan Magistrate, Saidapet, Chennai, while passing the impugned Judgments in C.C.No.5353 & 5354 of 2005, on 20.05.2008, in paragraph 9 & 10, had observed as follows:
(“Tamil”)
10. The above shows the contradictions on the part of the PW1 about the date and time of issuance of cheque. At the same time as alleged by the complainant side there were inconsistencies also in the versions of the accused about the issuance of cheque and liability thereon referred to above by the complainant side. In his evidence at the time of chief examination the DW1/accused has stated that, (“Tamil”).
The accused side has also taken a stand that the cheques were obtained under duress. This above also contrary to the above testimony of the accused. The judgment reported in 2007(1) MWN (Cr) DCC 77 cited by the complainant side deals about the case where for the loan obtained a promissory note was executed. The judgment reported in 2007(2) MWN (Cr.) 72 DCC deals about the case where drawer instructed for the stop payment and not exactly applicable to the fact and circumstances of the case like the other judgments of cited by the complainant side. It is surprising that when the PW1 has advanced such huge amount as loan why he has not maintained any records for the same. Admittedly, there was no entry about the transactions pertaining to the loan in his Income Tax returns. Contrary to the claim of the complainant, the accused maintain his stand consistently that the cheques in question were not give for any legally enforceable liability and debt at the time of replying to the legal notices sent by the complainant and during the course of trial. The circumstances naratted and the dictum in the judgment of Hon'ble Supreme Court reported in (2008) 1 CTC 433 squarely applicable to the case of the accused. At the same time, in view of the above contradictions on the version of the complainant and accused sides, two views are possible. However, in view of the categorical denial of the accused side and their consistence attempt in rebutting the presumption by denying the existence of any legally enforceable liability and debt for issuance of cheque from notice stage to trial stage and standard of proof on the accused side as it has been laid down in the various judgments of higher Courts including the judgments reported in 2006(5) CTC 296, (2008) 1 SCC 258 and 2008 (1) CTC 453 referred to by the accused side, this Court tend to take decision in favour of the accused side. The Complainant taken a stand that the cheques were given as security later used as against the liability subsisting at that time. Some judgments of High Courts also cited in this regard. If it was the original position, why in the complaint he has stated specifically that the cheques were given for debt.”
and resultantly dismissed the Complaints and found the Respondent/ Accused not guilty under Section 138 of the Negotiable Instruments Act and acquitted him under Section 255 Cr.P.C., for the reason that the Appellant/Complainant failed to prove his case through evidence that the Cheque No.778866 dated 21.4.2005 for Rs.1,95,000/-(in C.C.No.5353/2005), Cheque Nos.778865, 778864 dated 21.12.2004, 21.2.2005 each for Rs.2,00,000/- (in C.C.No.5354/2005), was given against the legally enforceable liability or loan.
The Appellant's Contentions (In Both Appeals):
3. According to the Learned Counsel for the Appellant/ Complainant, the trial Court had committed an error in acquitting the Accused, which is against Law and weight of Evidence and the Principles of Natural Justice.
4. The Learned Counsel for the Appellant urges before this Court that the trial Court should
