Case Note & Summary
The applicant, Rekha Mahindra Shah, was convicted under Section 138 of the Negotiable Instruments Act, 1881 for dishonour of three cheques totaling Rs.5,00,000 issued to the complainant, Gautam Umed Parmar, towards purchase of M.A. Structure goods on credit. The cheques were dishonoured with the remark 'exceeds arrangement'. After statutory notice, the accused failed to pay. The trial court convicted and sentenced her, which was confirmed by the appellate court. In revision, the accused argued that the cheques were given as security and not towards any debt. The High Court held that the presumption under Section 139 N.I. Act that the cheque was issued for discharge of a debt or liability is rebuttable, but the accused failed to rebut it as she did not lead any evidence. The concurrent findings of fact were not perverse. The revision was dismissed.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Presumption under Section 139 - The court considered whether the presumption that the cheque was issued for discharge of a debt or liability stands rebutted by the accused's defence that the cheques were given as security. Held that the presumption under Section 139 is rebuttable and the accused must prove on a preponderance of probabilities that there was no legally enforceable debt. The accused failed to rebut the presumption as she did not examine herself or any witness to support her defence. (Paras 1-10)
B) Criminal Procedure Code - Revision - Scope of Interference - Section 397 - The court examined the scope of revisional jurisdiction against concurrent findings of fact. Held that the revisional court will not interfere with concurrent findings unless they are perverse or based on no evidence. The findings of the courts below were based on evidence and not perverse. (Paras 1-10)
Issue of Consideration
Whether the conviction under Section 138 of the Negotiable Instruments Act, 1881 is sustainable when the accused claims the cheques were issued as security and not towards any legally enforceable debt or liability
Final Decision
The High Court dismissed the criminal revision application and confirmed the conviction and sentence under Section 138 of the Negotiable Instruments Act, 1881.
Law Points
- Presumption under Section 139 N.I. Act is rebuttable
- burden on accused to prove lack of consideration
- standard of proof is preponderance of probabilities
- concurrent findings of fact not interfered in revision unless perverse
Case Details
2013 LawText (BOM) (04) 56
Criminal Revision Application No.435 of 2011
Mrs. Prabha Badadare for Applicant/Appellant/Original Accused, Mr. Amit Borkar for Respondent No.1, Mr. A.S. Shitole, A.P.P., for Respondent No.2-State
Gautam Umed Parmar, The State of Maharashtra
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Nature of Litigation
Criminal revision against conviction under Section 138 of the Negotiable Instruments Act, 1881
Remedy Sought
The applicant/accused sought to set aside the conviction and sentence imposed by the trial court and confirmed by the appellate court
Filing Reason
The applicant/accused challenged the concurrent findings of conviction for dishonour of cheques issued towards purchase of goods
Previous Decisions
The Judicial Magistrate, First Class, 10th Court, Kolhapur convicted and sentenced the accused in Summary Criminal Case No.2252 of 2005 on 12th December, 2007. The Additional Sessions Judge, Kolhapur confirmed the conviction in Criminal Appeal No.19 of 2008 on 5th September, 2011.
Issues
Whether the presumption under Section 139 of the Negotiable Instruments Act, 1881 that the cheque was issued for discharge of a debt or liability stands rebutted by the accused's defence that the cheques were given as security?
Whether the revisional court should interfere with concurrent findings of fact?
Submissions/Arguments
The applicant/accused argued that the cheques were issued as security and not towards any legally enforceable debt or liability, and that the complainant failed to prove the existence of a debt.
The respondent/complainant argued that the presumption under Section 139 N.I. Act applies and the accused failed to rebut it by leading evidence.
Ratio Decidendi
The presumption under Section 139 of the Negotiable Instruments Act, 1881 that a cheque was issued for discharge of a debt or liability is rebuttable, but the accused must prove on a preponderance of probabilities that there was no legally enforceable debt. The accused failed to rebut the presumption as she did not examine herself or any witness. Concurrent findings of fact cannot be interfered with in revision unless perverse.
Judgment Excerpts
The learned Magistrate had convicted and sentenced the Applicant/Original Accused for an offence punishable under Section 138 of the Negotiable Instruments Act, 1881.
It is common ground that the Original Complainant/Respondent No.1 before me carries on business in the name and style M/s. Parmar Steel at Kolhapur.
Procedural History
The complainant filed Summary Criminal Case No.2252 of 2005 before the Judicial Magistrate, First Class, 10th Court, Kolhapur, which convicted the accused on 12th December, 2007. The accused appealed to the Additional Sessions Judge, Kolhapur in Criminal Appeal No.19 of 2008, which was dismissed on 5th September, 2011. The accused then filed the present criminal revision before the High Court.
Acts & Sections
- Negotiable Instruments Act, 1881: 138, 139
- Code of Criminal Procedure, 1973: 397
