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2023 Supreme(Online)(KER) 27234
HIGH COURT OF KERALA
C.S. DIAS, J
VICTORY PRESS (P) LTD. – Appellant
Versus
U.V.LOUIS AND ANOTHER – Respondent
CRL.A 1339 2011
SRI.G.SREEKUMAR (CHELUR), SMT.PREETHY KARUNAKARAN, SRI.K.RAVI PARIYARATH, SMT.R.RAJITHA, SRI.P.SANTHOSH PODUVAL, SRI.K.D.SREEVISAKH, SMT.SEETHA S
The presumption of a legally enforceable debt under Section 139 of the N.I. Act is a reverse onus clause, requiring the accused to provide credible evidence to negate this presumption.
Headnote:
Cheque - Offence of Dishonour - Negotiable Instruments Act - Sections 138, 139, 118 - The court reinstated the Trial Court's conviction ruling that the presumption of a legally enforceable debt under Section 139 was not rebutted, emphasizing the statutory presumptions related to negotiable instruments.
Fact of the Case:
The complainant alleged that the accused issued a cheque for an outstanding payment for a credit purchase. The cheque was dishonoured due to insufficient funds, resulting in a legal complaint under Section 138 of the N.I. Act after the accused failed to settle the amount despite receiving a statutory notice.
Finding of the Court:
The appellate court acquitted the accused, stating the cheque's differing inks and handwritings implied it was not issued for a legally enforceable debt. This ruling was contested for disregarding established legal precedents regarding presumptions in cheque-related offences.
Issues: Is the appellate court's judgment of acquittal sustainable considering the principles established under Sections 138 and 139 of the N.I. Act?
Ratio Decidendi: The initial presumption under Section 139 regarding the existence of a legally enforceable liability must be established unless the accused provides a probable defence. The appellate court's findings were deemed perverse for ignoring this legal framework.
Final Decision: The appeal is allowed; the appellate court's judgment is set aside; the Trial Court’s conviction is restored.
ORDER
The appeal is directed against the judgment of the Court of the Additional Sessions Judge, Fast Track Court -I, Thrissur (Appellate Court) in Crl.A.No.322/2010, holding the first respondent not guilty for an offence under Section 138 of the Negotiable Instruments Act ( in short, ‘N.I.Act’) and setting aside the judgment of the Judicial First Class Magistrate, Kunnamkulam (Trial Court) in C.C. No.269/2007. The parties are, for the sake of convenience, referred to as per their status before the Trial Court.
The facts in brief:
2. The complainant had filed the above complaint before the Trial Court alleging that it was a company engaged in the sale of paper. The accused had approached the complainant and had purchased paper on credit. In discharge of the outstanding amount, the accused issued Ext.P1 cheque dated 2.6.2006 for an amount of Rs.75,000/-. The cheque, on presentation before the bank for collection, was dishonoured due to ‘insufficient funds’ in the account of the accused. The complainant issued Ext.P4 lawyer notice to the accused. The accused failed to pay the demanded amount. Hence, the accused committed the offence under Sec.138 of the N.I Act.
Trial
3. The accused pleaded not guilty to the substance of acquisition read over to him. In the trial, the sales assistant of the complainant was examined as PW1 and Exts.P1 to P9 were marked in evidence. The accused denied the incriminating circumstances put to him in the questioning under Section 313 of the Code of Criminal Procedure (in short, ‘Cr.P.C.’). The accused did not let in any defence evidence.
Trial Court Judgment
4. The Trial Court, after analysing the materials on record, found the accused guilty and convicted him for the offence under Section 138 of the N.I.Act and sentenced him to undergo simple imprisonment for a period of three months and to pay a compensation of Rs.75,000/- to the complainant under Section 357 (3) of the Cr.P.C., and in default to undergo simple imprisonment for a further period of three months under Section 255 (2) of the Cr.P.C.
5. Aggrieved by the said judgment, the accused preferred Crl.A. No.322/2010 before the Appellate Court.
Appellate Court Judgment
6. The Appellate Court, after re-appreciating the materials on record, allowed the appeal and set aside the judgment of the Trial Court, and found the accused not guilty for the offence under Section 138 of the N.I. Act and consequently, acquitted the accused.
7. Aggrieved by the judgment of the Appellate Court, the complainant has preferred the present appeal.
8. Heard; Sri. Sreekumar G.(Chelur), the learned counsel appearing for the appellant; Sri.Santhosh Poduval, the learned counsel appearing for the first respondent and Smt.S.Seetha, the learned Senior Public Prosecutor appearing for the second respondent.
9. The learned counsel appearing for the appellant strenuously argued that the Appellate Court had gone wrong in concluding that the accused is not guilty for the offence under Section 138 of the N.I. Act, solely for the reason that the writings on Ext.P1 cheque were in different inks and handwriting. The Appellate Court has not appreciated the law laid down by the Honourable Supreme Court in Bir Singh v. Mukesh Kumar [(2019) 4 SCC 197] , wherein it is held that even a blank cheque voluntarily signed and handed over by the accused would attract the presumption under Section 139 of the N.I.Act. In the case on hand, the accused had not sent a reply notice or let in any evidence to rebut the reverse onus of proof cast on him under of the N.I.Act. Hence, the impugned judgment is perverse and is in total disregard to the settled law laid down by the Honourable Supreme Court. Therefore, the appeal is to be allowed.
10. The learned counsel appearing for the first respondent supported the judgment and submitted that this Court should be slow in interfering with an order of acquittal as per the broad principles laid down by the Honourable Supreme Court and this Court. The Appellate Cou
