The main legal point established in the judgment is that in cheque bouncing cases, the burden of proof is on the accused to prove the absence of debt or liability, and the presumption in favor of the holder of the cheque under Sections 138 and 139 of the Negotiable Instruments Act shifts the onus on the accused to rebut the presumption.

M.V. Muralidaran, J.

This appeal has been filed seeking to set aside the judgment dated 18.2.2008 made in C.A.No.108 of 2007 on the file of the learned Additional Sessions Judge (Fast Track Court No.II) Salem, reversing the judgment dated 03.7.2007 made in C.C.No.715 of 2005 on the file of the learned Judicial Magistrate No.II, Salem.

2. For the sake of convenience, the appellant and the respondent will be referred to as per their array in the complaint.

3. It is the case of the complainant that the accused borrowed a sum of Rs. 25,000/- from him and in discharge of the said loan, the accused issued the cheque in favour of the complainant. When the complainant presented the said cheque for encashment through his banker, the same has been returned as funds insufficient. Hence, the complainant had issued a legal notice to the accused to pay the cheque amount, but the respondent refused to pay the same. Thereafter, the complainant has filed the complaint under Section 138 of Negotiable Instruments Act (hereinafter referred to as "the NI Act") before the learned Judicial Magistrate No.II, Salem in C.C.No.715 of 2005. On receipt of summons, the accused appeared and when he was questioned about the accusation against him, he denied the same.

4. To prove the case, the complainant examined himself as P.W.1 and marked five documents. The accused was questioned about the incriminating circumstances appearing against him under Section 313 Cr.P.C., which he denied. One N.M.K.Raja was examined as D.W.1 and one Janjappan, the then Sub Inspector of Police, Omalur Police Station was examined as D.W.2 and through D.W.2, Ex.D1 was marked.

5. After considering the evidence adduced by both sides and hearing the learned counsel on either side, the trial Court, by judgment dated 3.7.2007, convicted the accused under Section 138 of the NI Act and sentenced him to undergo three months simple imprisonment and to pay compensation of Rs. 50,000/-.

6. Aggrieved by the conviction and sentence, the accused filed appeal being C.A.No.108 of 2007 before the learned Additional District Judge (Fast Track Court No.II), Salem, who by the judgment dated 18.2.2008, has acquitted the accused. Aggrieved by the same, the complainant had filed the present appeal against acquittal.

7. I heard Mr.R.Nalliyappan, learned counsel for the complainant and Mr.N.Karthikeyan, learned counsel for the accused and also perused the materials available on record.

8. In his evidence, the complainant, who was examined as P.W.1 had stated that the accused borrowed Rs. 25,000/- on 15.8.2005 for his family expenses from him and for repayment of the said amount, he had issued Ex.P1 cheque dated 15.10.2005 for Rs. 25,000/-. He further stated that when the cheque was presented for encashment, the same was returned as funds insufficient through Ex.P2. Thereafter, the complainant issued Ex.P3 legal notice to the accused to his two addresses demanding money and the acknowledgment cards were marked as Exs.P4 and P5.

9. Admittedly, in the case on hand, the accused has not examined as witness. However, in his evidence D.W.1-Raja has stated that he was running Gas Agency and was doing cement sales business and at the relevant point of time the accused was working in his shop. Since the accused sold different brand, he was removed. In his evidence, D.W.1 stated that in the business transaction between the complainant and the accused, there was a balance to be paid by the accused. Since the accused failed to pay the amount, the complainant lodged a complaint before the Omalur Police Station, where they entered into a compromise. Pursuant to which, the accused paid Rs. 15,000/- to the complainant and also issued cheque for Rs. 25,000/-. Narrating all these things, the complainant had written a letter to the Sub Inspector of Police and the same has been marked as Ex.D1. In his evidence, D.W.1 stated that the cheque in question was not issued for due consideration and therefore, the cannot be prosecuted