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CASE NO.: Appeal (crl.)  1410 of 2007

PETITIONER: K. Prakashan

RESPONDENT: P.K. Surenderan

DATE OF JUDGMENT: 10/10/2007

BENCH: S.B. Sinha & Harjit Singh Bedi

JUDGMENT: J U D G M E N T

S.B. SINHA,  J :

1.      Leave granted.

2.      The impugned judgment is one of reversal of a judgment of acquittal  passed by the learned Trial Judge in favour of the appellant.   

3.      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 \021insufficient  fund\022.  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  \023payment stopped by the drawer\024.   

4.      On 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 \023the Act\024).

5.      The complainant in support of its case led evidence to show that he  had advanced various sums on the following terms:

\023On 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/-.\024

6.      Defence 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.   

7.      The learned Trial Judge upon analyzing the materials brought on  records inter alia held:

(i)     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.  (ii)    As all the transactions were admittedly recorded by him in a diary  which having not been produced, an adverse inference should be  drawn.

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(iii)   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. (iv)    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.   (v)     The documentary evidence substantiates the case of the accused  that cheque No. 782451 allegedly given by him on 18.12.1995 was  not genuine.   (vi)    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.   (vii)   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.   (viii)  Although the burden of proof was on the appellant, he, in view of  the aforementioned circumstances, must be held to have  discharged the same.   8.      The 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:

(i)     \023\005Virtually, 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 so\005\024

(ii)    No adverse interference could have been drawn by the Trial Court  only because the purported diary was not produced.   

(iii)   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.   

       Although, 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.   

       The 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.

9.      Appellant is, thus, before us.

10.     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

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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].

11.     Ms. Rachna Srivastava, learned counsel appearing on behalf of the  complainanat \026 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.

12.     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 \021proved\022 and \021disproved\022 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.  

13.     It 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.   

14.     The learned Trial Judge had passed a detailed judgment upon  analysing the evidences brought on record by the parties in their entirety.   The 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 commenting:

\023\005Ext. 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

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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.\024

15.     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.   

16.     The question came up for consideration before a Bench of this Court  in M.S. Narayana Menon (supra) wherein it was held:     \02338. If for the purpose of a civil litigation, the  defendant may not adduce any evidence to  discharge the initial burden placed on him, a  \023fortiori\024 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 Court.   39. A presumption is a legal or factual assumption  drawn from the existence of certain facts.\024           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.

       The 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:

       \023The 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.  

       The 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 :

\02330. Applying the said definitions of \023proved\024 or  \023disproved\024 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

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the supposition that the consideration dos not exist.   For 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.\024

       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 was held;  

\02333.  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 another.\024\024

17.     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.

18.     Ms. Srivastava has relied upon a decision of this Court in Goaplast (P)  Ltd. v. Chico Ursula D\022Souza and Another [(2003) 3 SCC 232] wherein this  Court opined:   \0236\005The 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 one\022s 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

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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.\024   19.     No exception to the aforementioned legal principle can be taken.   What, however, did not fall for consideration in the aforementioned case was  as to how the said burden can be discharged.  

20.     It 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 court\022s 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.

21.     For the reasons aforementioned, the impugned judgment cannot be  sustained which is set aside accordingly.  The appeal is allowed.