Case Note & Summary
The appellant, Smt. Y. Bangarama, filed a criminal appeal challenging the judgment and order dated 23rd July 2008 passed by the learned Judicial Magistrate, First Class (Special Court) under the Negotiable Instruments Act, Nagpur, whereby the respondent/accused, Shri Rakesh Wahane (also referred to as Rajesh Wahane or Rakesh Waney), was acquitted of the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (N.I. Act). The appellant had agreed to purchase a plot from Bezonbagh Pragatishil Kamgar Griha Nirman Maryadit Sahakari Sanstha Maryadit, Nagpur, and the respondent represented himself as the Secretary of the society. The appellant purchased Plot No. 3 for a total consideration of Rs. 1,50,000 and paid the entire amount to the accused on 24.8.2001 after becoming a member of the society on 12.4.2001. The accused also asked for Rs. 25,000 towards registration charges, stamp duty, and miscellaneous expenses, but no receipt was issued. When the appellant attempted to construct on the plot, she was not allowed. She approached the accused, who promised to return the money and issued a cheque for Rs. 1,50,000 drawn on the State Bank of India, Nagpur. The cheque was dishonoured with the remark 'Account Closed'. The appellant issued a legal notice, but the accused failed to pay. The trial court acquitted the accused, holding that the complainant failed to prove the existence of a legally enforceable debt. The High Court, in appeal, found that the trial court had improperly appreciated the evidence. The appellant had proved the payment of consideration and the issuance of the cheque. The accused did not rebut the presumption under Section 139 of the N.I. Act that the cheque was issued for a legally enforceable debt. The High Court set aside the acquittal and convicted the accused under Section 138 of the N.I. Act, sentencing him to pay a fine of Rs. 1,50,000, with default simple imprisonment for three months.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Presumption under Section 139 - Rebuttal - The trial court acquitted the accused despite the cheque being dishonoured and the complainant establishing the existence of a legally enforceable debt. The accused failed to rebut the presumption under Section 139 by leading evidence or cross-examining the complainant effectively. The High Court held that the trial court's reasoning was perverse and set aside the acquittal. (Paras 2-5) B) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Legally Enforceable Debt - Consideration for Plot Purchase - The complainant paid Rs. 1,50,000 as consideration for a plot and an additional Rs. 25,000 for registration charges. The accused issued a cheque which was dishonoured. The High Court found that the complainant had proved the debt and the accused's defence was not credible. (Paras 2-4)
Issue of Consideration
Whether the trial court erred in acquitting the accused under Section 138 of the Negotiable Instruments Act, 1881, by improperly appreciating the evidence and failing to apply the presumption under Section 139 of the Act.
Final Decision
The appeal is allowed. The judgment and order of acquittal dated 23rd July 2008 passed by the learned Judicial Magistrate, First Class (Special Court) under the Negotiable Instruments Act, Nagpur, is set aside. The respondent/accused is convicted for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881, and sentenced to pay a fine of Rs. 1,50,000 (Rupees One Lakh Fifty Thousand only), in default to suffer simple imprisonment for three months.
Law Points
- Presumption under Section 139 of Negotiable Instruments Act
- 1881
- Rebuttal of presumption
- Standard of proof in cheque dishonour cases
- Burden of proof on accused
