Case Note & Summary
The appellant, The Bagayatdar Urban Co-operative Credit Society Ltd., filed a complaint under Section 138 of the Negotiable Instruments Act, 1881 against the respondent, Vernon Vaz, alleging dishonour of a cheque dated 12.11.2008 for Rs.1,74,430/-. The cheque was issued towards part payment of a loan availed by the respondent. The respondent's defence was that he had given a signed blank cheque at the time of sanctioning the loan agreement, which was misused by the complainant to recover money not due. The Judicial Magistrate, First Class, Ponda acquitted the respondent. The appellant appealed to the High Court. The High Court considered whether the accused had rebutted the presumption under Section 139 of the Act that the cheque was issued for a legally enforceable debt. The appellant argued that the accused failed to lead any defence evidence and did not effectively cross-examine the complainant's witness. The respondent contended that the complainant did not prove the loan transaction. The court held that the presumption under Section 139 is in favour of the complainant and the accused must rebut it by preponderance of probabilities. Since the accused did not lead any evidence and his statement under Section 313 Cr.P.C. was insufficient, the acquittal was set aside. The court convicted the respondent under Section 138 of the Act and sentenced him to pay a fine of Rs.2,00,000/-, with Rs.1,74,430/- to be paid as compensation to the appellant.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Presumption under Section 139 - Rebuttal - The accused claimed that a blank signed cheque was misused, but failed to lead any evidence or cross-examine the complainant's witness effectively. The court held that the presumption under Section 139 stands in favour of the complainant and the accused did not rebut it by preponderance of probabilities. (Paras 2-5) B) Criminal Procedure Code - Statement under Section 313 - Evidentiary Value - The accused's statement under Section 313 Cr.P.C. that he gave a blank cheque is not sufficient to rebut the presumption under Section 139 of the Negotiable Instruments Act, 1881 without supporting evidence. (Para 4)
Issue of Consideration
Whether the accused successfully rebutted the presumption under Section 139 of the Negotiable Instruments Act, 1881 that the cheque was issued for a legally enforceable debt or liability.
Final Decision
The High Court allowed the appeal, set aside the acquittal, convicted the respondent under Section 138 of the Negotiable Instruments Act, 1881, and sentenced him to pay a fine of Rs.2,00,000/-, in default simple imprisonment for three months. Out of the fine, Rs.1,74,430/- was ordered to be paid as compensation to the appellant.
Law Points
- Presumption under Section 139 of Negotiable Instruments Act
- 1881
- Rebuttal of presumption by accused
- Standard of proof for rebuttal
- Dishonour of cheque
- Legally enforceable debt
