The presumption of debt under Section 139 of the NI Act is rebuttable, and proving non-existence of a debt requires more than mere denial; evidence supporting the claim must exist.

JUDGMENT :

K. Surender, J.

Criminal Appeal Nos.505 and 512 of 2018 are filed by the appellant questioning the judgments dated 31.10.2017 passed in C.C.Nos.357 and 358 of 2016 respectively by the learned XXIV Special Magistrate, Hyderabad, wherein the respondent No.1/accused was found not guilty for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short ‘the NI Act, 1881’).

2. Since the issue involved in both the appeals is one and the same, hence, they are being disposed of by way of this common judgment.

3. The case of the appellant-complainant is that he got acquainted with the respondent No.1/accused through one G. Ramlal, S/o G. Krishnaji, who is a relative of the appellant. In December 2013, the respondent No.1/accused, along with his two sons namely Mr. Ashish and Sanketh and G. Ramlal, approached the appellant and requested to lend an amount of Rs.6,00,000/- for the purpose of developing their business. Accordingly, an amount of Rs.6,00,000/- was advanced to the respondent No.1/accused, who executed a receipt in favor of the complainant. Subsequently, towards repayment of the loan amount, the respondent No.1/accused issued two cheques to the complainant i.e., one for Rs.1,00,000/-, which is the subject matter of C.C.No.357 of 2016 and another cheque for Rs.50,000/-, which is the subject matter of C.C.No.358 of 2016. When both the cheques were presented for collection, they were dishonoured with endorsements “funds insufficient” on 09.09.2015 and 08.07.2015, respectively. Hence, the complaint.

4. During the course of trial, the complainant examined himself as PW.1 and marked Exs.P1 to P7 in C.C. No.357 of 2016 and Exs.P1 to P8 in C.C.No.358 of 2016, respectively. On the other hand, on behalf of the defence, DW.1 was examined in both the cases.

5. In both the appeals, notices that were issued were returned unserved.

6. According to DW.1, the two cheques, which were in his possession, were lost and hence, he lodged a complaint with the police. However, DW.1 did not file either the complaint copy or the receipt issued by the police upon receipt of the complaint about the lost two cheques.

7. The learned Magistrate acquitted the respondent No.1/accused on the following grounds:

(i) PW.1 admitted that he was residing at Chinthal Basthi, whereas the accused was residing at Dammaiguda and he do not know the accused personally;

(ii) PW.1 further admitted that he has no personal knowledge about any Electronic Shop being run by the sons of the accused or by the accused himself;

(iii) It is further admitted that PW.1 do not know the past or the present occupation of the accused and that he knew the accused only through one G. Ramlal, in whose presence the amount was given. However, the said Ramlal was not examined by the complainant; and (iv) The admissions made by the appellant would show that he was not closely acquainted with the accused.

(v) If at all, an amount of Rs.6,00,000/- was paid to the accused, no reason is given as to why cheques for an amount for Rs.1,00,000/- and Rs.50,000/- only were issued. Though the cheques were given after 18 months, no interest was demanded. Further, the complainant did not explain as to why only Rs.1,50,000/- worth of cheques were taken waiving the remaining amount. No proof was filed to show the income of the appellant and no income tax returns were also filed.

8. The learned counsel appearing for the appellant submits that the burden is on the accused to prove that the cheques were not issued towards any enforceable debt. Once the cheque is issued, a presumption arises under Section 139 of the NI Act, 1881 that the cheque was issued to discha