Full Judgment Text
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 6
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.
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 6
(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
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 6
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
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 6
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
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 6
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
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 6
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.