The capacity to advance the loan and the burden of proving the transaction creating an existing debt are fundamental facts that the complainant must establish. The presumption under Section 139 of the Negotiable Instruments Act is rebuttable, and the accused must raise a probable defence to rebut the presumption.

JUDGMENT

(Prayer: Criminal Revision Case has been filed under Section 397 and 401 of Cr.P.C., praying to call for the records on the learned II Additional District and Sessions Judge, Erode in C.A.No.211 of 2016 and set aside the judgment dated 8.8.2017 and confirming the order of acquittal by the learned Judicial Magistrate, Fast Track Court No.1, Erode in S.T.C.No.152 of 2016 dated 17.11.2016 and prays to allow this revision petition.)

1. The revision petitioner is the accused in S.T.C.No.152 of 2016 on the file of the Judicial Magistrate, (Fast Track Court No.1), Erode in a private complaint initiated under Section 138 of Negotiable Instruments Act. The cheque dated 16.11.2015 drawn by the petitioner for a sum of Rs.9 lakhs in favour of one K.Karthikeyan/respondent is the subject matter of the complaint.

2. According to the complainant, the petitioner borrowed a sum of Rs.9 lakhs and to discharge the debt, he gave the subject cheque. However, on presentation of the same, it was returned with an endorsement “Insufficiency of fund”. Hence, statutory notice dated 20.11.2015 was sent to the petitioner, which was received by the petitioner on 23.11.2015. The petitioner gave a reply dated 26.11.2015 containing false averments denying the liability and alleging the subject cheque was issued to one Ravi in connection with the loan transaction for purchasing three vehicles. To discharge the loan, the vehicles were handed over to Ravi, who sold the vehicles and appropriated the proceeds for the loan amount. He did not return the cheque given as security. The said cheque is being filed and presented in the name of the defacto complainant.

3. Before the trial Court, the complainant examined himself as PW-1. Five exhibits were marked. The trial Court held that the complainant failed to prove the fundamental fact that the cheque was issued towards legally enforceable debt. Though the accused failed to prove beyond doubt that the subject cheque was issued to one Ravi, when he availed finance for purchasing of three lorries, but by preponderance of probability he has discharged the initial burden of rebuttal the statutory presumption and therefore, dismissed the complaint and acquitted the accused.

4. The complainant preferred Appeal before the II Additional Sessions Court, Erode in C.A.No.211 of 2016. On re-appreciating the evidence, the appellate Court allowed the appeal stating that the failure of the accused to examine the said Ravi to whom he alleged to have given the subject cheque enures the presumption under Section 139 of Negotiable Instruments Act in favour of the complainant. The appellate Court held that the accused failed to rebut the presumption under Section 139 of the Negotiable Instruments Act. The capacity to advance loan of Rs.9 lakhs need not be proved by the complainant and therefore, dismissal of the complaint by the trial Court is erroneous.

5. The Appellate Court for the above said reasons, reversed the order of the acquittal and convicted the accused. One month Simple Imprisonment and compensation of Rs.9,000/-, in default, to undergo Simple Imprisonment was imposed.

6. The learned counsel appearing for the revision petitioner submitted that the appellate Court erred in reversing the well considered judgment of the trial Court. For advance of huge sum of Rs. 9 lakhs the complainant had no wherewithall. This has been raised in the reply notice itself. In spite of the said defence, the complainant has not produced any document to show, he had Rs.9 lakhs to advance loan to the accused/petitioner. In the cross examination, he has stated that he had given the entire loan of Rs.9 lakhs as cash in his house and the source of his income is 6 acres of agricultural land. Even for that he has not produced any document. Therefore, the trial Court has rightly held that by questioning the capacity of lending a huge sum of Rs.9 lakhs and by pleading that the subject cheque was not given to the complainant but to one Ravi in connection w