Case Note & Summary
The case involves a criminal revision petition filed by the accused, S. Mohammed, challenging his conviction under Section 138 of the Negotiable Instruments Act, 1881 (NI Act) for dishonour of five cheques. The complainant, Shekara Poojary, had lent money to the accused, and in discharge of the debt, the accused issued five cheques dated 22.10.2007, 31.10.2007, 6.11.2007, 17.11.2007, and 20.11.2007 for amounts of Rs. 14,500, Rs. 13,726, Rs. 13,978, Rs. 13,840, and Rs. 13,840 respectively. All cheques were drawn on Corporation Bank, Mangalore, and were presented for encashment but were dishonoured with the endorsement 'funds insufficient'. The complainant issued a legal notice dated 30.11.2007 demanding payment, which the accused received but failed to pay. Consequently, five private complaints were filed before the JMFC (V Court), Mangalore, which were tried as CC Nos. 659, 660, 1009, 1010, and 1011 of 2008. The trial court convicted the accused for the offence under Section 138 NI Act and sentenced him to pay a fine of Rs. 20,000 per cheque, in default simple imprisonment for six months. The accused appealed before the Principal Sessions Judge, Dakshina Kannada, Mangalore, in Criminal Appeal Nos. 131-135 of 2012, which were dismissed on 27.9.2014. Aggrieved, the accused filed the present revision petition under Sections 397 and 401 Cr.P.C. The main contention of the accused was that the loan was not legally enforceable because the complainant was a money lender without a valid licence under the Karnataka Money Lending Act, and therefore the debt was not recoverable. The High Court examined the evidence and found that the accused had admitted his signature on the cheques and the receipt of the legal notice. The court noted that under Sections 118 and 139 of the NI Act, there is a presumption that the cheques were issued for a legally enforceable debt. The accused failed to rebut this presumption by adducing any credible evidence. The mere fact that the complainant did not have a money lending licence did not automatically render the debt unenforceable, as the accused did not prove that the loan was not legally recoverable. The High Court held that the concurrent findings of fact by the courts below were based on proper appreciation of evidence and were not perverse. Therefore, no interference was warranted in revision. The revision petition was dismissed, and the conviction and sentence were upheld.
Headnote
A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Presumption under Sections 118 and 139 - The accused issued five cheques towards repayment of a loan. The cheques were dishonoured. The trial court convicted the accused under Section 138 NI Act, which was confirmed by the appellate court. In revision, the accused contended that the loan was not legally enforceable due to lack of licence under the Money Lending Act. The High Court held that the presumption under Sections 118 and 139 NI Act applies and the accused failed to rebut it. The concurrent findings of fact were not perverse and did not warrant interference in revision. (Paras 2-10) B) Negotiable Instruments Act - Rebuttal of Presumption - Standard of Proof - The accused must raise a probable defence to rebut the presumption of legally enforceable debt. Mere suggestion that the loan was not legally enforceable due to absence of a money lending licence is insufficient. The accused did not produce any evidence to show that the loan was not legally recoverable. The High Court upheld the conviction. (Paras 8-10)
Issue of Consideration
Whether the judgment of conviction and sentence passed by the trial court and confirmed by the appellate court for the offence under Section 138 of the Negotiable Instruments Act, 1881, is sustainable in law.
Final Decision
The High Court dismissed the criminal revision petition and upheld the judgment of conviction and sentence passed by the trial court and confirmed by the appellate court.
Law Points
- Presumption of legally enforceable debt under Sections 118 and 139 of the Negotiable Instruments Act
- 1881
- Rebuttal of presumption by accused
- Standard of proof in cheque bounce cases
- Concurrent findings of fact not to be interfered with in revision
