Case Note & Summary
The case involves a criminal appeal filed by the complainant, Shanaz D'Souza, against the acquittal of the accused, Sheikh Ameer Saheeb, under Section 138 of the Negotiable Instruments Act, 1881. The complainant alleged that the accused borrowed Rs. 2,00,000 on 1 June 2002, repayable within six months. Upon failure to repay, the accused issued two cheques dated 4 November 2002 and 5 November 2002, each for Rs. 1,00,000, drawn on Vysya Bank Ltd., Margao. The cheques were presented through Corporation Bank, Murida Branch, but were dishonoured on 13 November 2002 due to insufficient funds. A statutory notice dated 25 November 2002 was sent to the accused, demanding payment within 15 days. The accused failed to comply, leading to the filing of a complaint on 31 December 2002. The trial court acquitted the accused on 30 December 2004, holding that the complainant failed to prove the debt and that the accused had rebutted the presumption under Section 139 of the Act. The complainant appealed. The High Court examined the evidence, noting that the complainant's father, as power of attorney holder, testified and proved the issuance and dishonour of the cheques. The court held that the presumption under Section 139 was raised, and the accused failed to rebut it by preponderance of probabilities. The accused's defence that the cheques were given as security for a loan from a third party was not supported by evidence. The High Court allowed the appeal, set aside the acquittal, and convicted the accused under Section 138 of the Act, sentencing him to pay a fine of Rs. 2,50,000, with Rs. 2,40,000 to be paid as compensation to the complainant.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Presumption under Section 139 - Rebuttal - The complainant proved issuance of cheques and their dishonour, raising presumption under Section 139 that the cheques were issued for discharge of a debt or liability. The accused failed to rebut this presumption by preponderance of probabilities, as his defence that the cheques were given as security for a loan from a third party was not supported by evidence. Held that the trial court erred in acquitting the accused (Paras 2-10). B) Negotiable Instruments Act - Power of Attorney Holder - Testimony - Section 138 - The complainant's father, holding a power of attorney, was examined as a witness. The court held that the power of attorney holder can depose on behalf of the complainant, and his testimony is admissible. The trial court's rejection of the complaint on the ground that the complainant did not personally depose was erroneous (Paras 2-5). C) Negotiable Instruments Act - Burden of Proof - Section 139 - Once the presumption under Section 139 is raised, the burden shifts to the accused to prove that the cheque was not issued for a debt or liability. The accused must adduce evidence to rebut the presumption; mere denial is insufficient. Held that the accused failed to discharge this burden (Paras 6-10).
Issue of Consideration
Whether the complainant's appeal against acquittal under Section 138 of the Negotiable Instruments Act, 1881 should be allowed, and whether the trial court erred in holding that the complainant failed to prove the debt and that the accused had rebutted the presumption under Section 139 of the Act.
Final Decision
The High Court allowed the appeal, set aside the acquittal, convicted the accused under Section 138 of the Negotiable Instruments Act, 1881, and sentenced him to pay a fine of Rs. 2,50,000, in default simple imprisonment for six months. Out of the fine, Rs. 2,40,000 was ordered to be paid as compensation to the complainant.
Law Points
- Presumption under Section 139 Negotiable Instruments Act
- 1881
- Rebuttal of presumption
- Burden of proof on accused
- Validity of power of attorney holder's testimony
- Dishonour of cheque for insufficiency of funds
