The main legal point established in the judgment is the rebuttable nature of the presumptions under Sections 118 and 139 of the Negotiable Instruments Act, and the acceptance of liability upon issuing a cheque.

JUDGMENT :

MEENAKSHI MADAN RAI, J.

1. By the impugned Judgment dated 25.03.2017, in Private Complaint Case No. 79 of 2014, the learned Chief Judicial Magistrate acquitted the Respondent of the offence under Section 138 of the Negotiable Instruments Act, 1881 (for brevity “the NI Act”) having reached a finding that the Appellant (Complainant before the learned Trial Court) had failed to bring home proof of the existence of a legally recoverable debt or other liability for which the cheque was issued by the Respondent/Accused.

2. The Appellant is before this Court assailing the impugned Judgment.

3. For convenience, a brief factual reference is essential. The Respondent is said to be a share broker, running a business of stocks and shares at M.G. Marg, Gangtok. On the asking of the Respondent, the Appellant invested a sum of Rs.3,00,000/- (Rupees three lakhs) only, in the said business. After a few months he requested the Respondent to return his money, the investment being devoid of profit. In response thereto, the Respondent issued a cheque for Rs.3,00,000/- (Rupees three lakhs) only, to the Appellant on 09.09.2014, drawn on the ICICI Bank, New Market Branch, Gangtok. The Appellant on the same day with the consent of the Respondent deposited the cheque for realisation at the State Bank of India, Gangtok Main Branch, which however was dishonoured by the Banker of the Respondent/Accused and returned to the Appellant’s Banker with the remark - “insufficient funds”, by their Memo dated 10.09.2014. The Appellant was informed of the said circumstance. On 01.10.2014, the Appellant issued a legal Notice to the Respondent through his Advocate requiring him to pay the amount of the dishonoured cheque within the statutory period of 15 (fifteen) days from the date of service of Notice. The Notice was sent to the place of business of the Respondent but was returned with the remark – “addressee out of station”. Thereafter, on the Respondent having failed to take steps within the statutory period, the Appellant filed a Complaint before the Court of the learned Chief Judicial Magistrate, East Sikkim at Gangtok, who on examining the Complainant found prima facie materials against the Respondent under Section 138 of the NI Act. On completion of trial, the impugned Judgment of acquittal was pronounced.

4. Advancing his arguments for the Appellant, Learned Counsel would canvass that the learned Trial Court while acquitting the Respondent had failed to appreciate that the Respondent had not denied the fact of delivery of the cheque or his signature on the cheque raising the presumption under Section 118 and Section 139 of the NI Act. That, the learned Trial Court erred in holding that the Respondent who is a share broker is not liable to refund the invested amount neither did the Court take into consideration that the Appellant had made part payment of Rs.1,00,000/- (Rupees one lakh) only, on 31.10.2014, as discharge of his debt and liability to the Appellant subsequent to the filing of the Complaint. That, the books of accounts for the shares were never revealed to the Appellant to indicate the investments made by the Respondent with the Appellant’s money. Merely stating that losses incurred without accounts of investment is not justified. It was further contended that the Respondent in his Statement under Section 313 of the Code of Criminal Procedure, 1973 (for short “the Cr.P.C.) stated that Exhibit-1 was issued for security only and not for encashment while concealing the fact of payment of Rs.1,00,000/- (Rupees one lakh) only, already made by him pursuant to the Complaint lodged by the Appellant. Reliance was placed on Don Ayengia vs. State of Assam and another, (2016) 3 SCC 1 to buttress his contention that a cheque issued for security purpose would also be covered by the provisions of Section 138 of the NI Act. That, although the account and password thereof is allegedly with the Respondent, he has refused to divulge it to the Appellant. To fort