The presumption of consideration under Section 139 of the Negotiable Instruments Act applies once the signature on the cheque is admitted, shifting the burden of proof to the accused.

JUDGMENT:

The appellant/complainant preferred this appeal aggrieved by the acquittal of the accused, recorded by the Special Magistrate III, Cyberabad at Malkajgiri, in C.C.No.27 of 2018, dated 01.03.2019, under Section 138 of the Negotiable Instruments Act, 1881.

2. Briefly, the case of the complainant is that the accused is the daughter of her cook namely Ch.Uma (examined as DW.2). Since they were acquainted, the accused approached the complainant along with (DW.2) requesting for hand loan of Rs.10 lakhs to meet their immediate domestic expenditure i.e., to clear debts of her brother and also for other purposes. Rs.10 lakhs was given by the complainant on various dates. The accused promised that the amount would be repaid after sale of the house of DW.2. However, the amounts were not returned. Then, a Promissory Note was executed for the said amount and after repeated requests, the cheque in question for Rs.10 lakhs was drawn by the accused and handed over to the complainant. The said cheque, when presented for clearance, was returned unpaid on the ground of ‘insufficient funds’. Legal Notice was sent on 20.10.2017, but the same was returned with an endorsement ‘no such addressee’. Since the accused was living in the very same address and payment was not made pursuant to issuance of notice, complaint was filed.

3. The appellant/complainant examined herself as PW.1, her husband as PW.2 and two other friends as PWs.3 and 4. The accused examined herself as DW.1 and her mother as DW.2.

4. The Learned Magistrate, having considered the evidence on record, acquitted the accused on the following grounds:

i) Ex.P1-Promissory Note was not attested by any of the witnesses and the name of the scribe is also not mentioned.

ii) The complainant has filed the IT returns of the husband, which has no relevance to the facts of the case.

iii) PW.2, who is the husband of the complainant entered into the box and stated that he was not aware of the source of amount that was given as hand loan by his wife PW.1 to the accused.

iv) It is not for a prudent man to give such huge amount of Rs.10 lakhs to a cook-cum-domestic help and her daughter who was a private employee working as lab assistant.

v) The initial burden on the complainant to prove that the amount covered by the cheque was towards enforceable debt, was not discharged by the complainant.

vi) The version given by the accused that the promissory note and the cheque were taken as security in the private chit run by PW.1 can be believed. The version that the accused was member of chit for Rs.75,000/- and when the prize amount was paid in two instalments, the promissory note and the cheque were given as security, is believable.

5. Learned Counsel appearing on behalf of complainant would submit that once the signature on the promissory note and the cheque is admitted, presumption has to be drawn under Section 139 of the Negotiable Instruments Act. Except stating that they were given towards security, no evidence was placed on record by the accused to discharge her burden. The lower Court was carried away by the story created by the accused during the course of trial.

6. Learned Counsel further argued that the Honourable Supreme Court in Rangappa v. Sri Mohan, [(2010) 11 Supreme Court Cases 441], held that presumption arises once the signature on the cheque is admitted. In the said case, the Honourable Supreme Court dealt with a situation where the accused has taken the defence that the cheque was lost and he also intimated the Bank about the lost cheque. The Honourable Supreme Court found that the instructions to stop payment and that the cheque was lost, were taken