The burden of proof under Section 139 of the NI Act lies with the accused to discharge the presumption that the cheques were issued in discharge of a liability.

JUDGMENT :

(Prayer: Criminal Revision preferred under Sections 397 and 401 read with Section 482 Cr.P.C. to set aside the judgment and order dated 27.08.2019 passed by the Principal Sessions Judge, Tiruvallur in C.A.No.21 of 2018 confirming the judgment and order dated 04.01.2018 passed by the Judicial Magistrate, FTC (Magisterial Level), Ambattur in S.T.C.No.273 of 2016.)

1. This matter is taken up for hearing via video conferencing.

2. This Criminal Revision has been preferred challenging the judgment and order dated 27.08.2019 passed by the Principal Sessions Judge, Tiruvallur in C.A.No.21 of 2018 confirming the judgment and order dated 04.01.2018 passed by the Judicial Magistrate, Fast Track Court (Magisterial Level), Ambattur in S.T.C.No.273 of 2016.

3. For the sake of convenience, the parties are referred to by their names.

4. Joykutty (complainant) was the owner of a land measuring 1 acre and 66 cents in Vengadamangalam village. M/s. Dhanishka (A1) is a partnership firm, in which, Ravi Prabhakar (A2) is the Managing Partner and his wife, Isha Ravi (A3) is the other partner.

4.1. M/s.Dhanishka (A1) is in the business of land development and apartments construction. Joy Kutty entered into a development agreement dated 03.02.2010 (Ex.P1) with M/s.Dhanishka (A1) and also executed a Power of Attorney on 11.02.2010, whereby, giving 60% of undivided share and the proportionate built up area to M/s.Dhanishka (A1), retaining the balance 40% with him.

4.2. Under the terms of the agreement, M/s.Dhanishka (A1) marketed the project and collected Rs.50,00,000/- from eight parties towards Joy Kutty’s share, but, did not credit it into his account. When Joy Kutty approached the accused, they issued a letter dated 20.02.2014 (Ex.P2), agreeing to give Rs.50,00,000/- to Joy Kutty and also enclosing two cheques dated 20.03.2014 for Rs.25,00,000/- (Ex.P3) and 06.04.2014 for Rs.25,00,000/- (Ex.P4).

4.3. However, the accused requested Joy Kutty not to present the cheques, until they instruct him and accordingly, the accused gave a letter dated 06.05.2014 (Ex.P5) asking Joy Kutty to present the cheques after 22.05.2014. Joy Kutty presented the cheques, but, they were returned on 23.05.2014 with the endorsement ‘funds insufficient’ vide return memo (Ex.P6 Series).

4.4. Joy Kutty issued a statutory demand notice dated 05.06.2014 (Ex.P7), which was received by the accused and they issued a reply notice dated 21.06.2014 (Ex.P8), generally denying the transaction. Therefore, Joy Kutty initiated a prosecution in S.T.C.No.273 of 2016 in the Court of the Judicial Magistrate, Magisterial Level, Ambattur under Section 138 of the Negotiable Instruments Act, 1881 (for brevity “the NI Act”), against M/s.Dhanishka (A1), Ravi Prabhakar (A2) and Isha Ravi (A3).

5. From the side of the complainant, two witnesses viz. Joy Kutty (P.W.1) and Magesh Balakrishnan (P.W.2) were examined and Exs.P1 to P15 were marked. In the cross-examination, the accused marked two exhibits viz. an agreement (Ex.D1) and a Power of Attorney (Ex.D2). No witness was examined from the side of the accused.

6. When the accused were questioned under Section 313 Cr.P.C., they denied the incriminating circumstances appearing against them.

7. After considering the evidence on record and hearing either side, the trial Court, by judgment and order dated 04.01.2018 in S.T.C.No.273 of 2016, convicted M/s.Dhanishka (A1) and Ravi Prabhakar (A2), but, acquitted Isha Ravi (A3) on the ground that there was no evidence to show that she was actively participating in the affairs of M/s.Dhanishka (A1). However, M/s.Dhanishka (A1) being a juristic person, the trial Court directed M/s.Dhanishka (A1), Ravi Prabhakar (A2) and Isha Ravi (A3) to pay compensation of Rs.50,00,000/- being the cheque amount to the complainant within three months, with a further direction that Ravi Prabhakar (A2) and Isha Ravi (A3) would hav