Vs. P.K. Surenderan  Insc 1029 (10 October 2007)
Sinha & Harjit Singh Bedi S.B. Sinha, J :
impugned judgment is one of reversal of a judgment of acquittal passed by the
learned Trial Judge in favour of the appellant.
Respondent herein allegedly, on diverse dates, advanced a sum of Rs. 3,16,000/-
to the appellant who issued a cheque for the said amount on 18.12.1995. The
said cheque was dishonoured on the ground of insufficient fund.
Allegedly, when the matter was brought to the notice of the appellant, he
undertook to remit the amount on or before 30.01.1996. The cheque was again
presented but the same was not encashed on the ground payment stopped by
the aforementioned premise, a complaint petition was filed by the respondent
herein against the appellant under Section 138 of the Negotiable Instruments
Act (for short the Act).
complainant in support of its case led evidence to show that he had advanced
various sums on the following terms:
31-1-94 a sum of Rs. One lakh; on 8-6-94, Rs. 86,000/-; on 12-6-94, Rs. 28,000/-; on 23-4-95, Rs. 50,000/- on 18-6-95, Rs. 40,000/- and on 7-8-95, Rs. 12,000/-.
of the appellant, on the other hand, was that he had issued blank cheques for
the purpose of purchase of spare parts, tyres, etc. in connection with the
business of transport services run in the name of his brother. The blank cheques
used to be returned by the sellers of spare parts, etc. when the amounts were
paid. According to the appellant, the complainant lifted the impugned cheque
book put in the bag and kept in his shop. Appellant in support of his case
examined the Bank Manager of the Bank concerned.
learned Trial Judge upon analyzing the materials brought on records inter alia
The complainant himself who had not sufficient funds and used to borrow the
same from his brothers, father and others failed to show that he had any
financial capacity to advance such a huge amount.
As all the transactions were admittedly recorded by him in a diary which having
not been produced, an adverse inference should be drawn.
The complainant failed to prove before the Court that there had been any
commercial or business transaction between himself and the accused. The
complainant had not charged even any interest although a huge sum was allegedly
advanced on diverse dates.
From Ext. D1 the counterfoil of the cheque book issued to the appellant from
the bank it appeared that whereas cheque No. 782460 was presented before the
bank for collection of the dues on 30.12.1993, cheque No. 782451 of the same cheque
book reached the bank only on 8.01.1996. It was, therefore, opined that if the
last cheque reached the bank for collection on 30.12.1993, in normal and
reasonable course cheque No. 782451 must have been issued even prior thereto.
The documentary evidence substantiates the case of the accused that cheque No.
782451 allegedly given by him on 18.12.1995 was not genuine.
The complainant contradicted himself insofar as whereas in the complaint
petition he inter alia alleged that the loan was raised by him from his father
as also from others; in his evidence, he did not state that he had borrowed any
amount from third parties.
The cheque dated 18.12.1995 which is said to have been handed over to him on
5.10.1995 should have been encashed immediately after the date of issue as he
is said to be in need of money which was not done.
Although the burden of proof was on the appellant, he, in view of the
aforementioned circumstances, must be held to have discharged the same.
High Court, however, by reason of the impugned judgment reversed the said
findings of the learned Trial Judge holding inter alia that the appellant having
not examined himself cannot be said to have discharged the burden of proof cast
on him in terms of Section 139 of the Act stating:
Virtually, the accused has not adduced any evidence to establish the
specific case set up by him that the cheque leaf was placed inside a bag and
that the above bag was kept in the shop of the complainant and that the
complainant has lifted the particular cheque leaf during the period the bag was
kept in his shop. He has also not adduced any evidence to establish his contention
that he, employed as a driver in the K.S.R.T.C., was also involved in managing
the private bus owned by his brother and that he used to issue blank cheques
for the purchase of spare parts, tyres, etc. The above are matters that he
could have adduced independent evidence in support. But he has declined to do
No adverse interference could have been drawn by the Trial Court only because
the purported diary was not produced.
The finding of the Trial Judge that it was difficult to believe that the
complainant has advanced diverse amounts without any stipulation as to interest
is not supported by any evidence.
ordinarily a judgment of acquittal should not be reversed when two views are
possible, the High Court opined that the Trial Judge had proceeded and adjudged
the evidence on an incorrect premise that it was for the complainant to
establish the details of the transaction.
High Court recorded a judgment of conviction and sentenced the appellant to
undergo imprisonment till the rising of the court and to pay a sum of Rs. 3,16,000/-
by way of compensation.
Appellant is, thus, before us.
Mr. Ramesh Babu M.R., learned counsel appearing on behalf of the appellant,
would submit that the High Court committed a manifest error in reversing the
judgment of acquittal passed by the learned Trial Judge completely on a wrong
premise inasmuch as for discharging the burden of proof it was not necessary
for the appellant to examine himself. Materials brought on record, the learned
counsel would contend, having been found to be sufficient for shifting the
burden of proof upon the complainant as the accused had discharge his primary
onus, the High Court committed a serious error in passing the impugned
judgment. Strong reliance in this behalf has been placed on M.S. Narayana Menon
Alias Mani v. State of Kerala and Another [(2006) 6 SCC 39].
Ms. Rachna Srivastava, learned counsel appearing on behalf of the complainanat respondent,
on the other hand, would submit that having regard to the fact that the
appellant had raised a specific defence, viz., theft of the cheque book, it was
for him to prove the same and as he has not examined himself, the impugned
judgment should not be interfered with.
The Act raises two presumptions; firstly, in regard to the passing of
consideration as contained in Section 118 (a) therein and, secondly, a
presumption that the holder of cheque receiving the same of the nature referred
to in Section 139 discharged in whole or in part any debt or other liability.
Presumptions both under Sections 118 (a) and 139 are rebuttable in nature.
Having regard to the definition of terms proved and
disproved as contained in Section 3 of the Evidence Act as also the
nature of the said burden upon the prosecution vis-`-vis an accused it is not
necessary that the accused must step into the witness box to discharge the
burden of proof in terms of the aforementioned provision.
is furthermore not in doubt or dispute that whereas the standard of proof so
far as the prosecution is concerned is proof of guilt beyond all reasonable
doubt; the one on the accused is only mere preponderance of probability.
The learned Trial Judge had passed a detailed judgment upon analysing the
evidences brought on record by the parties in their entirety.
criminal court while appreciating the evidence brought on record may have to
weigh the entire pros and cons of the matter which would include the
circumstances which have been brought on record by the parties. The complainant
has been found to be not a man of means. He had allegedly advanced a sum of Rs.
1 lakh on 13.01.1994. He although had himself been taking advances either from
his father or brother or third parties, without making any attempt to realize
the amount, is said to have advanced sums of Rs. 86,000/- on 8.06.1994.
Likewise he continued to advance diverse sums of Rs. 28,000/-, Rs. 50,000/-, Rs.
40,000/- and Rs. 12,000/- on subsequent dates. It is not a case where the
appellant paid any amount to the respondent towards repayment of loan. He even
did not charge any interest. He had also not proved that there had been any
commercial or business transactions between himself and the appellant. Whey the
appellant required so much amount and why he alone had been making payments of
such large sums of money to the appellant has not been disclosed. According to
him, he had been maintaining a diary. A contemporaneous document which was in
existence as per the admission of the complainant, therefore, was required to
be brought on records. He failed to do so. He also did not examine his father
and brothers to show that they were men of means and in fact advanced a huge
sum to him only for the purpose of grant of loan by him to the appellant. The
learned Trial Court not only recorded the inconsistent stand taken by the
complainant in regard to the persons from whom he had allegedly borrowed the
amount, it took into consideration the deposit of the cheques in the bank
D1 the counterfoil of the cheque book issued to the accused from that bank, was
proved through him. It contains the counterfoils of the cheques 782451 to
782460. Ext. D2 is the pass book issued to the accused from that bank. SW1 is
the Branch Manager of Syndicate Bank, Koyilandy. He would say that in Ext. P4
ledger extract, cheque No. 782460 reached the bank for collection on 30.12.93.
The net transaction in that account was in the year 1996. Cheque No. 782451
reached the bank on 8.1.96. Ext. D1 shows that is the first cheque in that
book. 782460 is the lost cheque in that book. If the lost cheque i.e. 782460
reached the bank for collection on 30.12.93 in normal and reasonable course the
first cheque i.e. 782451 might have been issued even prior to that date. Case
of the complainant is that Ext. P1 cheque was given to him by the accused on
5.10.95 and the cheque was dated 18.12.95. Ext. P4, D1 and D2 substantiate the
case of the accused that the allegation of the complainant that Ext. P1 cheque
was given to him on 18.12.95 is not genuine.
The High Court, as noticed hereinbefore, on the other hand, laid great emphasis
on the burden of proof on the accused in terms of Section 139 of the Act.
The question came up for consideration before a Bench of this Court in M.S. Narayana
Menon (supra) wherein it was held:
If for the purpose of a civil litigation, the defendant may not adduce any
evidence to discharge the initial burden placed on him, a fortiori
even an accused need not enter into the witness box and examine other witnesses
in support of his defence. He, it will bear repetition to state, need not
disprove the prosecution case in its entirety as has been held by the High
presumption is a legal or factual assumption drawn from the existence of
certain facts. It was furthermore opined that if the accused had been able
to discharge his initial burden, thereafter it shifted to the second respondent
in that case.
said legal principle has been reiterated by this Court in Kamala S. v. Vidhyadharan
M.J. and Another [(2007) 5 SCC 264] wherein it was held:
Act contains provisions raising presumption as regards the negotiable
instruments under Section 118(a) of the Act as also under Section 139 thereof.
The said presumptions are rebuttable ones. Whether presumption stood rebutted
or not would depend upon the facts and circumstances of each case.
nature and extent of such presumption came up for consideration before this
Court in M.S. Narayana Menon Alias Mani V. State of Kerala and Anr. [(2006) 6
SCC 39] wherein it was held :
Applying the said definitions of proved or disproved to the
principle behind Section 118(a) of the Act, the court shall presume a
negotiable instrument to be for consideration unless and until after
considering the matter before it, it either believes that the consideration
does not exist or considers the non-existence of the consideration so probable
that a prudent man ought, under the circumstances of the particular case, to
act upon the supposition that the consideration dos not exist.
rebutting such presumption, what is needed is to raise a probable defence. Even
for the said purpose, the evidence adduced on behalf of the complainant could
be relied upon. This Court clearly laid down the law that standard of
proof in discharge of the burden in terms of Section 139 of the Act being of
preponderance of a probability, the inference therefor can be drawn not only
from the materials brought on record but also from the reference to the
circumstances upon which the accused relies upon. Categorically stating that
the burden of proof on accused is not as high as that of the prosecution, it
Presumption drawn under a statute has only an evidentiary value. Presumptions
are raised in terms of the Evidence Act. Presumption drawn in respect of one
fact may be an evidence even for the purpose of drawing presumption under
We, therefore, are of the opinion that keeping in view the peculiar fact
situation obtaining in the present case it cannot be said that the judgment
passed by the learned Trial Judge was perverse or suffered from any legal
infirmity. It was not a case where the learned Trial Judge failed to consider
the evidences brought on record and/ or mis-appreciated the same.
Ms. Srivastava has relied upon a decision of this Court in Goaplast (P) Ltd. v.
Chico Ursula DSouza and Another [(2003) 3 SCC 232] wherein this Court
presumption can be rebutted by adducing evidence and the burden of proof is on
the person who wants to rebut the presumption. This presumption coupled with
the object of Chapter XVII of the Act which is to promote the efficacy of
banking operation and to ensure credibility in business transactions through
banks persuades us to take a view that by countermanding payment of post-dated cheque,
a party should not be allowed to get away from the penal provision of Section
138 of the Act. A contrary view would render Section 138 a dead letter and will
provide a handle to persons trying to avoid payment under legal obligations
undertaken by them through their own acts which in other words can be said to
be taking advantage of ones own wrong. If we hold otherwise, by giving
instructions to banks to stop payment of a cheque after issuing the same
against a debt or liability, a drawer will easily avoid penal consequences
under Section 138. Once a cheque is issued by a drawer, a presumption under
Section 13 9 must follow and merely because the drawer issued notice to the drawee
or to the bank for stoppage of payment it will not preclude an action under
Section 138 of the Act by the drawee or the holder of the cheque in due course.
This was the view taken by this Court in Modi Cements Ltd. v. Kuchil Kumar Nandi
2 . On same facts is the decision of this Court in Ashok Yeshwant Badave v. Surendra
Madhavrao Nighojakar. The decision in Modi case overruled an earlier decision
of this Court in Electronics Trade & Technology Development Corpn. Ltd. v.
Indian Technologists & Engineers (Electronics) (P) Ltd. which had taken a
contrary view. We are in respectful agreement with the view taken in Modi case.
The said view is in consonance with the object of the legislation. On the faith
of payment by way of a post-dated cheque, the payee alters his position by
accepting the cheque. If stoppage of payment before the due date of the cheque
is allowed to take the transaction out of the purview of Section 138 of the
Act, it will shake the confidence which a cheque is otherwise intended to
inspire regarding payment being available on the due date. 19. No exception
to the aforementioned legal principle can be taken.
however, did not fall for consideration in the aforementioned case was as to
how the said burden can be discharged.
is now trite that if two views are possible, the appellant court shall not
reverse a judgment of acquittal only because another view is possible to be
taken. The appellate courts jurisdiction to interfere is limited. [See
M.S. Narayana Menon (supra) and Mahadeo Laxman Sarane & Anr. v. State of Maharashtra, 2007 (7) SCALE 137] The High Court
furthermore has not met the reasons of the learned Trial Judge. It proceeded on
the premise that the appellant had not been able to discharge his burden of
proof in terms of Section 139 of the Act without posing unto itself a further question
as to how the said burden of proof can be discharged. It furthermore did not
take into consideration the legal principle that the standard of proof upon a
prosecution and upon an accused is different.
the reasons aforementioned, the impugned judgment cannot be sustained which is
set aside accordingly. The appeal is allowed.