The presumption of innocence remains paramount in acquittal cases, and the burden of proof lies with the prosecution, which must establish a legally enforceable debt to succeed under the NI Act.

Judgment

Mr. Harpreet Singh Brar, J.

The instant application under Section 378(4) CrPC is preferred against judgment of acquittal dated 07.07.2023 passed by learned Judicial Magistrate Ist Class, Panipat in criminal complaint no. NACT/843/2018 dated 11.04.2018 under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter ‘NI Act’).

2. The facts, in brief, are that the applicant firm had obtained a work contract from Paharpur Cooling Towers Limited, in pursuance of which the applicant installed machines and set up the work site in Aligarh. The work assigned was delivered to the respondents-accused and it was settled that the respondents will pay Rs. 13,29,373/- to the applicant for installation and removing the said machines from the work site. In discharge of their liability, the respondents issued cheque no. 998624 dated 07.12.2017 for Rs.4,00,000/-, cheque no. 998625 dated 10.12.2017 for Rs. 4,50,000/- and cheque no. 998573 dated 15.12.2017 for Rs. 4,79,373 in favour of the applicant. However, on presentation, the cheques were dishonoured vide memo dated 11.12.2017, 15.12.2017 and 18.12.2017 respectively with the remarks ‘funds insufficient.’ Thereafter, on assurance of accused aforesaid cheques were again presented in the bank for encashment but also, these three cheques were again dishonoured on 17.02.2018 with remarks ‘funds insufficient’. Thereafter, legal notice dated 14.03.2018 was served upon the respondents but since they failed to make the requisite payment, a criminal complaint under Section 138 of the NI Act was lodged.

3. On the basis of material available on record, the accused were summoned. On finding a prima facie case against the accused, a notice of accusation was served upon them for the commission of an offence under Section 138 of the NI Act, to which they pleaded not guilty and claimed trial. Subsequently, the accused were tried and acquitted vide the impugned judgment dated 07.07.2023.

4. Learned counsel for the applicant-appellant contends that the defence of the accused that the cheques were given as security is self-contradicting as in their statement under Section 313 of the CrPC, the respondents had deposed that they had nothing to do with Paharpur Cooling Towers Limited. They further stated that the applicant was motivated to misuse the cheques in question because the contract was taken away from them and given to the respondents. Moreover, the respondents have admitted to the signatures on the disputed cheques. However, soon after the cheques were dishonoured, the respondents paid the amount due to the applicant through NEFT. Further, as per the minutes of the meeting dated 11.01.2018, the applicant agreed to having received Rs. 13,00,000/- from the respondents in lieu of sand and metal aggregates worth Rs. 13,28,383/-. This payment was made for the raw materials while the cheque was issued towards expenses incurred by the applicant towards installation and removal of machinery from the work site.

5. It is further argued that Satya Prakash Rai, Manager/Representative of Paharpur Cooling Towers Limited, who appeared in the witness box as DW2 has duly admitted that the applicant had installed the machinery on the work site and incurred expenses around Rs. 15,00,000/- to Rs. 20,00,000/-.The dishnoured cheques in question are duly admitted by the respondents and were issued by the respondents towards the amount spent by the applicant towards removal of the said machinery from the site.

6. Having heard the learned counsel for the appellant-applicant and after perusing the record with their able assistance, I am of the view that the applicant-appellant has not been able to indicate any perversity in the impugned judgment.

7. The NI Act creates a presumption in favour of the prosecution in terms of Section 118 and 139. The same are reproduced as under:

Section 118: Presumptions as to negotiable instruments.

Until the contrary is proved, the following presumptions shall be made:--

(a) of consideration:--