Vs. Muniyappan & Anr  Insc 554 (18 October 2001)
K.T.Thomas S. N. Variava, J.
Special Leave Petition (crl.) 969 of 2001
stated the facts are as follows:
Appellant filed a complaint under Section 138 of the Negotiable Instruments Act
as the cheque dated 6th April, 1993 in a sum of Rs.63720/-, issued by the 1st
First Respondent in favour of the Appellant on Central Bank, had been
dishonored with the remarks "Insufficient Funds". The Appellant had
issued a legal notice dated 28th April, 1993.
Receipt of the said notice is admitted. A reply dated 21st May, 1993 was sent by the 1st Respondent.
However no payment was made.
trial the Judicial Magistrate-II, Kumbakonam, convicted the 1st First
Respondent under Section 138 and directed payment of a fine of Rs.65000/-. In
default the 1st Respondent was to suffer simple imprisonment for one year. The
1st Respondent challenged the conviction and sentence by filing Criminal Appeal
No. 32 of 1995. The same came to be dismissed by the Sessions Judge on 28th August, 1995.
1st Respondent then preferred Criminal Revision No. 883 of 1995 before the High
Court of Madras. A learned Single Judge, by the impugned Order dated 20th July, 2000, set aside the conviction and
acquitted the 1st Respondent. The learned Judge acquitted the 1st Respondent on
the ground that the Appellant had not proved that the cheque dated 6th April, 1993 had been issued for any debt or
view the impugned Judgment cannot be sustained at all. The Judgment erroneously
proceeds on the basis that the burden of proving consideration for a dishonored
cheque is on the complainant. It appears that the learned Judge had lost sight
of Sections 118 and 139 of the Negotiable Instruments Act. Under Sections 118,
unless the contrary was proved, it is to be presumed that the Negotiable
Instrument (including a cheque) had been made or drawn for consideration. Under
Section 139 the Court has to presume, unless the contrary was proved, that the
holder of the cheque received the cheque for discharge, in whole or in part, of
a debt or liability.
in complaints under Section 138, the Court has to presume that the cheque had
been issued for a debt or liability. This presumption is rebutable.
the burden of proving that a cheque had not been issued for a debt or liability
is on the accused. This Court in the case of Hiten P. Dalal vs. Bratindranath Banerjee
reported in (2001) 6 S.C.C. 16 has also taken an identical view.
case admittedly the 1st Respondent has led no evidence except some formal
evidence. The High Court appears to have proceeded on the basis that the
denials/averments in his reply dated 21st May, 1993 were sufficient to shift the burden
of proof onto the Appellant/Complainant to prove that the cheque was issued for
a debt or liability. This is an entirely erroneous approach. The 1st Respondent
had to prove in the trial, by leading cogent evidence, that there was no debt
or liability. The 1st Respondent not having led any evidence could not be said
to have discharged the burden cast on him. The 1st Respondent not having
discharged the burden of proving that the cheque was not issued for a debt or
liability, the conviction as awarded by the Magistrate was correct. The High
Court erroneously set aside that conviction.
this view of the matter the impugned Judgment is set aside. The conviction and
sentence as awarded by the Magistrate by his order dated 21st March, 1994, stand. The 1st Respondent is
granted one months' time to pay the fine. In default thereof he shall suffer
simple imprisonment for 3 months. The fine, if realised, Rs.60,000/- therefrom
shall be paid to the Complainant as compensation.
Appeal stands disposed of accordingly. There will be no Order as to costs.