Case Note & Summary
The case involves two criminal revision petitions filed by M/s. Nazama Traders (petitioner) against M/s. Arihant Marketing (respondent) under Section 397 read with Section 401 of the Code of Criminal Procedure, 1973. The petitioner challenged the judgments of the LVIII Additional City Civil and Sessions Judge, Bangalore, dated 2.12.2015, in Criminal Appeals No.1293/2014 and No.1292/2014, which reversed the trial court's conviction order dated 6.11.2014 in CC No.20049/2011 and CC No.20048/2011 respectively. The trial court had convicted the respondent for the offence under Section 138 of the Negotiable Instruments Act, 1881, for dishonour of cheques issued towards discharge of a debt. The appellate court acquitted the respondent on the grounds that the complainant was not examined and that the notice under Section 138 was not properly served. The High Court, after hearing both sides, held that the appellate court erred in reversing the trial court's judgment. The court noted that the respondent had admitted the signature on the cheque, which raised a presumption under Section 139 of the NI Act that the cheque was issued for a legally enforceable debt. The court also held that service of notice by registered post was sufficient and that the appellate court's finding on improper service was incorrect. The High Court allowed the revision petitions, set aside the appellate court's judgments, and restored the trial court's conviction and sentence.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Presumption under Section 139 - The court held that once the execution of the cheque and signature are admitted, a mandatory presumption under Section 139 of the Negotiable Instruments Act, 1881 arises in favour of the holder that the cheque was issued for discharge of a debt or liability. The appellate court erred in reversing the trial court's conviction without considering this presumption. (Paras 10-15) B) Negotiable Instruments Act - Notice under Section 138 - Service of Notice - The court held that service of notice by registered post is sufficient compliance under Section 138 of the Negotiable Instruments Act, 1881. The appellate court's finding that notice was not served properly was erroneous as the postal endorsement of 'refused' or 'not claimed' raises a presumption of service. (Paras 16-20) C) Criminal Procedure Code - Appellate Court's Power - Reversal of Acquittal - The court held that the appellate court should not reverse a well-reasoned judgment of the trial court without proper justification. The appellate court's order was set aside as it failed to appreciate the evidence and the legal presumptions. (Paras 21-25)
Issue of Consideration
Whether the appellate court was justified in reversing the trial court's conviction solely on the ground that the complainant was not examined and that the notice was not served properly, without considering the mandatory presumption under Section 139 of the Negotiable Instruments Act, 1881?
Final Decision
The High Court allowed the revision petitions, set aside the judgments of the appellate court dated 2.12.2015, and restored the trial court's conviction and sentence dated 6.11.2014.
Law Points
- Presumption under Section 139 NI Act
- Notice under Section 138 NI Act
- Service of notice by registered post
- Examination of complainant
- Appellate court's power to reverse acquittal
