Case Note & Summary
The appellant-complainant alleged that he advanced a loan of Rs.22,00,000 to the respondent-accused, who issued a cheque dated 17.03.2010 for the same amount. The cheque was dishonoured on 07.05.2010 with the endorsement 'payment stopped by drawer'. The complainant sent a legal notice on 18.05.2010, but the accused did not reply. Consequently, a complaint case was filed under Section 138 of the Negotiable Instruments Act, 1881. The Trial Court convicted the accused, sentencing him to one year simple imprisonment and a fine of Rs.35,00,000, with Rs.30,00,000 as compensation to the complainant. The Appellate Court upheld the conviction. However, the High Court, in criminal revision, set aside the conviction, holding that the complainant failed to prove the existence of a legally enforceable debt due to lack of evidence regarding his financial capacity and the circumstances of the cheque's issuance. The Supreme Court allowed the appeal, restoring the conviction. The Court held that the High Court exceeded its revisional jurisdiction by reappreciating evidence and disregarding the statutory presumptions under Sections 118 and 139 of the Act. The accused admitted his signature on the cheque but claimed it was lost, yet the intimation of loss was backdated and not converted into an FIR. The accused failed to rebut the presumption of a legally enforceable debt. The concurrent findings of the courts below were based on proper appreciation of evidence and did not suffer from any perversity. The Supreme Court restored the conviction and sentence, but considering the accused's age and family circumstances, granted six months to pay the fine, failing which he must undergo the default sentence.
Headnote
A) Criminal Law - Cheque Dishonour - Section 138 Negotiable Instruments Act, 1881 - Presumption of Legally Enforceable Debt - The complainant must establish that the cheque was genuine, presented within time, dishonoured, and notice sent within 30 days. Once these are proved, presumptions under Sections 118 and 139 arise that the cheque was issued for a legally enforceable debt. The accused must rebut this presumption with a probable defence. In this case, the accused admitted his signature on the cheque but claimed it was lost. The High Court erred in reappreciating evidence and holding that the complainant failed to prove the debt, ignoring the presumption and the accused's failure to provide credible evidence of loss. Held that the High Court exceeded its revisional jurisdiction and the concurrent findings of the courts below were justified. (Paras 15-20) B) Criminal Procedure - Revisional Jurisdiction - Section 397, 401 Code of Criminal Procedure, 1973 - Scope of Interference - The revisional court cannot act as an appellate court and reappreciate evidence to reverse concurrent findings of fact unless there is a patent illegality, perversity, or miscarriage of justice. In this case, the High Court set aside the conviction by re-evaluating the evidence, which is impermissible. Held that the High Court's order was unsustainable and the conviction was restored. (Paras 14, 20) C) Evidence - Presumption - Sections 118 and 139 Negotiable Instruments Act, 1881 - Rebuttal - The accused must raise a probable defence to rebut the presumption that the cheque was issued for a legally enforceable debt. Mere denial or claim of loss without credible evidence is insufficient. The accused's intimation of loss to police was backdated and not converted into an FIR, thus lacking evidentiary value. Held that the accused failed to rebut the presumption. (Paras 17-19)
Issue of Consideration
Whether the High Court, in exercise of its revisional jurisdiction, was justified in setting aside the concurrent findings of guilt and conviction recorded by the Trial Court and Appellate Court under Section 138 of the Negotiable Instruments Act, 1881, by reappreciating evidence and disregarding the statutory presumptions under Sections 118 and 139 of the Act.
Final Decision
Appeal allowed. Impugned order of High Court set aside. Conviction and sentence imposed by Trial Court and upheld by Appellate Court restored. Accused granted six months to pay fine of Rs.35,00,000, failing which to undergo three months simple imprisonment. Compensation of Rs.30,00,000 to be paid to complainant from fine amount.
Law Points
- Presumption of legally enforceable debt under Sections 118 and 139 of Negotiable Instruments Act
- 1881
- Revisional court's limited jurisdiction to interfere with concurrent findings of fact
- Burden of proof on accused to rebut presumption
- Requirement of complainant to prove basic ingredients of Section 138
