The complainant under Section 138 of the N.I. Act does not bear the initial burden to prove financial capacity to lend; mere denial by the accused does not suffice to rebut the legal presumption of liability.

CAV JUDGMENT

1. This appeal is filed by the appellant being aggrieved by the judgment of acquittal passed by the Appellate Court for the offence punishable under Section 138 of the Negotiable Instruments Act (for short ‘N.I Act’).

2. The ranks of the parties in the Trial Court will be considered henceforth for convenience.

Brief facts of the case:

3. It is the case of the appellant that he knew the accused since many years and both were known to each other. It is stated that the accused had borrowed a sum of Rs.30,00,000/- on different dates for the purpose of purchasing the gold and silver articles on the occasion of the marriage of her daughter and also for other legal necessities.

4. It is stated that in the first week of April 2017, when the complainant approached the accused and asked her to return the loan which he had given to her, the accused had issued a cheque dated 15.06.2017 for a sum of Rs.30,00,000/- and requested the complainant to present the same for encashment. When the said cheque was presented for encashment, it got dishonoured for want of sufficient funds. Therefore, the complainant issued a notice to the accused and informed her about the dishonour of cheque. In spite of service of notice, the accused neither replied to the said notice nor returned the amount. Therefore, the complainant filed a complaint before the jurisdictional Magistrate.

5. To prove the case, the complainant got himself examined as PW.1 and got marked 15 documents as Exs.P1 to P15. On the other hand, the accused got herself examined as DW.1 and examined another witness as DW.2. The Trial Court after appreciating the oral and documentary evidence on record, convicted the accused for the offence punishable under Section 138 of N.I Act. On appeal being filed, the Appellate Court set aside the judgment of conviction passed by the Trial Court and acquitted the accused for the offence punishable under Section 138 of N.I Act.

6. Heard Sri.K.Vijaya Kumar, learned counsel for the appellant and Sri.B.O.Chandra Shekar, learned counsel for the respondent.

7. It is the submission of the learned counsel for the appellant that the Appellate Court has misread the principles of N.I Act and opined that the initial burden would lie upon the complainant to prove his case and thereafter the burden would be shifted to the accused, which is contrary to the principles of the N.I Act and also the law laid down by the Hon'ble Supreme Court in various cases.

8. It is further submitted that the Trial Court has failed to raise the presumption which was required to be raised in favour of the complainant. Having failed to raise such presumption, resulted in passing the impugned judgments. Therefore, the judgment of acquittal passed by the Appellate Court has to be set aside. Making such submissions, the learned counsel for the appellant prays to allow the appeal.

9. Per contra, the learned counsel for the respondent justified the findings of the Appellate Court and he submitted that initially the complainant has to discharge the presumption that he had sufficient means or financial capacity to lend such a huge amount. Once it is proved, the Trial Court has to raise the presumption in favour of the complainant. Therefore, the burden would be shifted on the accused to rebut the said presumption.

10. It is further submitted that the complainant being the Conductor working at BMTC stated to have paid the amount of Rs.30,00,000/- to the accused cannot be accepted and the same is considered as unimaginable. Such being the fact, the findings of the Appellate Court in rendering the acquittal is appropriat