Case Note & Summary
The appeal was filed by the complainant, Mr. Anthony Francis D'Souza, against the judgment dated 26/06/2009 passed by the Judicial Magistrate First Class (JMFC) at Mapusa, Goa, acquitting the accused, Mr. Shitakant Salgaonkar, under Section 138 of the Negotiable Instruments Act, 1881. The complainant and accused had business transactions wherein the accused purchased construction material from the complainant. Due to shortage of funds, the accused issued two post-dated cheques: one for Rs.11,621/- dated 18/03/2008 and another for Rs.45,000/- dated 21/04/2008. Both cheques were deposited by the complainant but were returned dishonoured on 02/05/2008 with the endorsement 'funds insufficient'. The complainant issued a demand notice dated 07/05/2008, which the accused received on 12/05/2008 but did not reply or comply. Consequently, the complaint was filed. During trial, the complainant admitted that he had received Rs.5,000/- before dishonour and Rs.10,000/- after dishonour but before the cause of action, totaling Rs.15,000/-. The trial court held that the complainant suppressed these payments, which constituted unfair conduct and helped the accused rebut the presumption under Section 139 of the NI Act. The accused was acquitted. The High Court, however, found that the accused did not lead any evidence to rebut the presumption. The court noted that the mere suppression of payments by the complainant does not automatically rebut the presumption; the accused must prove that the cheques were not issued for a legally enforceable debt. Since the accused failed to do so, the acquittal was set aside and the accused was convicted under Section 138 of the NI Act. The accused was sentenced to pay a fine of Rs.46,621/- (the cheque amount) and in default, to undergo simple imprisonment for three months. The court also directed that out of the fine, Rs.45,000/- be paid to the complainant as compensation.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Suppression of Payments - The complainant suppressed the fact that he had received Rs.5,000/- before dishonour and Rs.10,000/- after dishonour but before cause of action, which the trial court held as unfair conduct rebutting the presumption under Section 139. The High Court held that such suppression does not automatically rebut the presumption; the accused must lead evidence to rebut the presumption. The appeal was allowed and conviction restored. (Paras 2-6) B) Negotiable Instruments Act - Presumption under Section 139 - Rebuttal - The accused failed to lead any evidence to rebut the presumption that the cheques were issued for discharge of a legally enforceable debt. Mere suppression of payments by the complainant does not shift the burden of proof. The trial court erred in acquitting the accused. (Paras 4-6)
Issue of Consideration
Whether the acquittal of the accused under Section 138 of the Negotiable Instruments Act, 1881 was justified on the ground that the complainant suppressed payments received from the accused, thereby rebutting the presumption under Section 139 of the Act.
Final Decision
Appeal allowed. Impugned judgment dated 26/06/2009 set aside. Accused convicted under Section 138 of the Negotiable Instruments Act, 1881. Accused sentenced to pay fine of Rs.46,621/-, in default simple imprisonment for three months. Out of fine, Rs.45,000/- to be paid to complainant as compensation.
Law Points
- Suppression of payments by complainant
- rebuttal of presumption under Section 139 NI Act
- conduct of complainant
- fair approach to court
- Section 138 Negotiable Instruments Act
- 1881
