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2023 Supreme(P&H) 2586

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
AMAN CHAUDHARY, J.
Davinder Singh – Applicant
Versus
Ajay Kamboj – Respondent
CRM-A-371 of 2019 (O&M)
Decided On : 01-05-2023

Advocates Appeared:
Mr. Satbir Singh Gill, Advocate; For the Appellant

Headnote:(A) Negotiable Instruments Act, 1881 - Section 138 and 139 - Acquittal of accused under Section 138 for dishonour of cheques due to non-establishment of a legal liability by the complainant - The complainant failed to prove the cheque was issued for a legitimate debt; the burden of proof rested on him. (Paras 2, 10)

(B) Legal Principles - The presumption under Section 139 is rebuttable, and once the defence raises a reasonable doubt, the onus shifts back to the complainant to prove the case beyond reasonable doubt. (Paras 8, 10)

(C) Appellate Powers - An appellate court may review and reconsider evidence in appeals against acquittal but must respect the presumption of innocence. (Paras 11, 12)

Facts of the case:
The complainant alleged that the accused issued cheques for Emu eggs as per an agreement, which were dishonoured, leading to the complaint under the NI Act. The trial Court acquitted the accused due to lack of evidence proving the complainant's claims.

Findings of Court:
The trial Court found that the complainant could not establish his liability, leading to the acquittal of the accused, affirming that raising a doubt is sufficient for acquittal.

Issues: The main issues were whether the complainant proved that the cheque was issued in discharge of a legal debt and the adequacy of the evidence to sustain a conviction.

Ratio Decidendi: The court emphasized that the complainant must prove the debt beyond reasonable doubt, while the defence only needs to create a reasonable doubt; hence, acquittal was affirmed as no compelling evidence supported the prosecution's claims.

Result: Application for leave to appeal dismissed.

Table of Content
1. summary of factual background and case initiation. (Para 1 , 2 , 3 , 4 , 5)
2. applicant's contention regarding the validity of the cheque. (Para 6)
3. observations on burden of proof and legal liabilities. (Para 7 , 9 , 10)
4. legal standards applicable to appeals against acquittal. (Para 8 , 11 , 12)
5. conclusion on the rejection of the appeal. (Para 13)

JUDGMENT

Aman Chaudhary, J.

The present application for leave to appeal has been preferred against the judgment dated 20.11.2018, whereby the respondent was acquitted of the charges leveled under section 138 of the Negotiable Instruments Act (for short 'NI Act') against him.

2. Briefly put, the facts of the case are that a complaint had been filed by complainant-appellant alleging therein that accused-respondent was running a business namely "Galaxy Agro Foods International, Sirsa", in the course of which he came to the complainant and proposed him to engage in the business of Emu farming. Thereafter, they entered into an agreement dated 02.08.2012 and as per the contract, the respondent was to supply Emu birds and allegedly, in return was to buy eggs from the appellant. Then on demand for the payment, the accused issued two cheques of Rs. 5 lakh each. On presentation to the bank, one of the cheques, bearing No. 954054, was dishonoured due to insufficient funds. Thereafter, a legal notice was sent, to which the reply was that no payment was made. Hence, the complaint was filed.

3. On notice of accusation under Section 138 of the Act, he appeared and pleaded not guilty. To prove his case, the complainant, himself got examined along with 3 other witnesses Thereafter, statement of the petitioner under Section 313 of the Code of Criminal Procedure was recorded wherein he denied allegations levelled against him. In defence, no witness was examined and evidence was closed.

4. On meticulous examination of the evidence and hearing the counsel for the parties, the trial Court acquitted the accused-respondent as the complainant could not establish his guilt.

5. Hence, the present application for leave to appeal.

6. Learned counsel contends that the trial Court had erred in acquitting the accused-respondent only on the ground of applicant having failed to prove that the cheque in question was ever issued for discharging of his legal debt and liability. It is admitted fact that an agreement dated 02.08.2012, Exhibit P12, was executed between the parties, regarding sale and purchase of Emu birds and eggs. As per the contract, the rate of Emu eggs was fixed by mutual consent and they were to be bought directly from the complainant's farm. Therefore, it can be inferred that it was for the purpose of selling eggs to the respondent, that the cheque in question was issued by him for discharging his liability.

7. Heard and perused the file.

8. It would be profitable to refer the judgment of Hon'ble The Supreme Court in case of Basalingappa v. Mudibasappa (2019) 5 SCC 418, wherein the principles governing sections 118(a) and 139 of NI Act were laid down:

    "(i) Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.

    (ii) The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities.

    (iii) To rebut the presumption, it is open for the accused to rely on evidence led by him or accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely.

    (iv) That it is not necessary for the accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a persuasive burden.

    (v) I

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