Case Note & Summary
The case involves a criminal appeal filed by the original complainant, Mrs. Rosa Maria Fernandes, against the judgment and order dated 11.12.2008 passed by the Judicial Magistrate First Class, 'C' Court, Margao, acquitting the respondent, Mr. Nauso N. Kepkar, under Section 138 of the Negotiable Instruments Act, 1881. The complainant alleged that she had extended a loan of Rs.50,000/- to the accused, who executed a promissory note dated 28.07.2004. Subsequently, the accused took a further loan of Rs.15,000/- and executed an affidavit dated 30.07.2004 acknowledging the total loan of Rs.65,000/-. In repayment, the accused issued a cheque for Rs.50,000/- dated 28.01.2005, drawn on Bank of Baroda, Benaulim Branch. The cheque was presented but dishonoured due to insufficient funds on 24.06.2005. The complainant issued a legal notice dated 05.07.2005, received by the accused on 14.07.2005, but the accused failed to pay. The trial court acquitted the accused on the ground that the complainant failed to prove the loan. The High Court considered the legal issues: whether the presumption under Section 139 of the Negotiable Instruments Act applies, and whether the accused rebutted it. The appellant argued that the accused admitted his signature and handwriting on the cheque and promissory note, raising the presumption of a legally enforceable debt. The respondent argued that the loan was not proved and the cheque was not for a debt. The court analyzed that under Section 139, once the signature on the cheque is admitted, a presumption arises that the cheque was issued for a legally enforceable debt. The accused did not lead any evidence to rebut this presumption. The court held that the trial court erred in acquitting the accused. The appeal was allowed, the acquittal was set aside, and the accused was convicted under Section 138 of the Negotiable Instruments Act. The accused was sentenced to pay a fine of Rs.75,000/- (Rs.50,000/- as compensation to the complainant and Rs.25,000/- to the State), in default, simple imprisonment for three months.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Presumption under Section 139 - The complainant alleged that the accused issued a cheque for Rs.50,000/- towards repayment of a loan. The accused admitted his signature and handwriting on the cheque and promissory note. The trial court acquitted the accused on the ground that the complainant failed to prove the loan. The High Court held that once the signature and handwriting are admitted, the presumption under Section 139 arises that the cheque was issued for a legally enforceable debt. The accused failed to rebut this presumption. The acquittal was set aside and the accused was convicted. (Paras 1-10) B) Evidence Act - Admission - Section 58 - Admission of signature and handwriting on a document amounts to admission of the contents of the document. The accused's admission of his signature and handwriting on the promissory note and cheque was sufficient to prove the loan transaction. (Paras 6-8) C) Negotiable Instruments Act - Presumption - Section 139 - Burden of Proof - The burden is on the accused to rebut the presumption that the cheque was issued for a legally enforceable debt. Mere denial or suggestion of a different transaction is not enough. The accused must lead evidence to show that the cheque was not for a debt or liability. (Paras 7-9)
Issue of Consideration
Whether the acquittal of the accused under Section 138 of the Negotiable Instruments Act, 1881, was proper given the presumption under Section 139 and the evidence on record.
Final Decision
The appeal is allowed. The judgment and order of acquittal dated 11.12.2008 passed by the Judicial Magistrate First Class, 'C' Court, Margao, is set aside. The respondent is convicted under Section 138 of the Negotiable Instruments Act, 1881. The respondent is sentenced to pay a fine of Rs.75,000/- (Rupees Seventy Five Thousand only). Out of the fine amount, Rs.50,000/- shall be paid to the complainant as compensation, and the remaining Rs.25,000/- shall be deposited with the State. In default of payment of fine, the respondent shall undergo simple imprisonment for three months.
Law Points
- Presumption under Section 139 of Negotiable Instruments Act
- 1881
- Burden of proof on accused to rebut presumption
- Admission of signature and handwriting on cheque and promissory note
- Legally enforceable debt or liability
- Acquittal set aside
