Case Note & Summary
The petitioner, a partnership firm dealing in iron and steel products, filed four complaint cases under Section 138 of the Negotiable Instruments Act, 1881 against the first respondent, alleging that four cheques issued by the respondent were dishonoured due to insufficient funds. The cheques were dated between 07.11.2008 and 24.11.2008, drawn on Axis Bank Limited, and were presented for encashment on 04.05.2009, but were returned dishonoured. The petitioner claimed that it had granted financial assistance to the respondent and the cheques were issued in discharge of her liability. The trial court acquitted the respondent, holding that the petitioner failed to prove the existence of a legally enforceable debt or liability. The High Court of Calcutta dismissed the petitioner's appeal against acquittal. The Supreme Court, in the present special leave petitions, examined whether the High Court's decision was justified. The Court noted that the respondent had taken the defence that the money was advanced for stock market trading and not as a loan. The trial court had found that the petitioner did not produce any documentary evidence to prove the financial assistance, and the respondent's testimony was credible. The Supreme Court held that the presumption under Section 139 of the Act is rebuttable, and the respondent had successfully rebutted it by raising a probable defence. The Court further held that the High Court had correctly applied the principles governing appeals against acquittal, and there was no perversity in the findings. Accordingly, the Supreme Court dismissed the special leave petitions.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Presumption under Section 139 - The complainant must prove that the cheque was issued in discharge of a legally enforceable debt or liability. The presumption under Section 139 is rebuttable and the accused can raise a probable defence. In this case, the accused successfully rebutted the presumption by showing that the transaction was for stock market trading and not a loan. (Paras 1-10) B) Criminal Procedure Code - Appeal against Acquittal - Section 378 - The High Court in an appeal against acquittal should not interfere unless the findings are perverse or unreasonable. The Supreme Court upheld the High Court's decision as the trial court's findings were based on evidence and not perverse. (Paras 1-10)
Issue of Consideration
Whether the High Court was justified in dismissing the appeal against acquittal under Section 138 of the Negotiable Instruments Act, 1881, and whether the presumption under Section 139 of the Act was rebutted by the accused.
Final Decision
The Supreme Court dismissed the special leave petitions, upholding the acquittal of the respondent.
Law Points
- Presumption under Section 139 of Negotiable Instruments Act
- 1881 is rebuttable
- Burden of proof on complainant to prove existence of debt or liability
- Standard of proof in criminal appeals against acquittal
