(Prayer: This Criminal Revision Petition is filed under Section 397 r/w 401 of Cr.P.C praying to set aside the judgment and order dated 02.11.2018 passed by the LX Additional City Civil and Sessions Judge, Bengaluru (CCH-61) in Criminal Appeal No.542/2017 and sentence dated 03.03.2017 passed by the XV Additional Chief Metropolitan Magistrate, Bengaluru City in C.C.No.18797/2016 against the accused and acquit the accused.)
1. These petitions have been filed by the petitioner accused challenging the judgment passed by the LX Additional City Civil and Sessions Judge, Bengaluru in Crl.A.Nos.542/2017, 543/2017, 541/2017 and 514/2017 respectively, wherein the appeals came to be dismissed by confirming the common judgment and order passed by XV Additional Chief Metropolitan Magistrate Court, Bengaluru in C.C.Nos.18797/2016, 18796/2016, 18798/2016 and 18795/2016 respectively.
2. I have heard the learned counsel for the petitioner accused No.2 and the learned counsel for the respondent complainant.
3. Since in all these cases both the parties are same and facts and law involved are one and the same, they are clubbed together and common order has been passed.
4. It is the case of the complainant that the complainant is a film director and accused No.2 used to undertake the work of make up to the film artists. In that context, complainant and accused No.2 came in contact. During the year 2012-2013 complainant accumulated a sum of Rs.40 lakhs for production of the film. Due to unavoidable circumstances, the complainant could not produce the film. In view of the acquaintance, accused No.2 sought for hand loan to the extent of Rs.25 lakhs from the complainant and in this regard, she has issued post dated cheques for discharge of the said liability. Accused was paying the interest regularly and all of a sudden in the month of November 2014, she stopped paying interest. As such, complainant insisted for repayment of the amount and at that time, accused No.2 got executed a loan agreement on 20.2.2015 and to refund the said amount, has issued the cheques. When the said cheques were presented for encashment, the same were dishonoured with the shara as "funds insufficient" and thereafter, a legal notice came to be issued. In spite of service of notice, no reply was given and the amount has not been paid, as such, the complainant filed a private complaint.
5. The learned Magistrate took cognizance of the offence and secured the presence of the accused. The accused appeared and her plea was recorded. She pleaded not guilty and claimed to be tried. As such, trial was fixed. In order to prove the case of the complainant, the complainant got examined himself as P.W.1 in all the cases and got marked the documents. In one of the cases i.e., C.C.No.18798/2016, he got examined the bank manager as P.W.2. Thereafter, statement of the accused was recorded under Section 313 of Cr.P.C. The accused got examined herself as D.W.1 and in two cases she got marked Ex.D1. After hearing the learned counsel appearing for the parties, the trial Court held the accused guilty. Being aggrieved by the same, accused preferred four appeals. The appeals also came to be dismissed. Hence, petitioner-accused No.2 is before this Court.
6. The main grounds urged by the learned counsel for the petitioner-accused No.2 are that the order of the appellate Court in dismissing the appeals and confirming the judgment and order of conviction passed by the trial Court are not sustainable in law and the same are liable to be set aside. It is his submission that the Courts below have not applied their mind to the factual matrix of the case. The trial Court, in its judgment, has made a chart mentioning the amount, cheque numbers and date, said to have been issued by accused No.2 in favour of the complainant. If the entire amount is calculated, it will not exceed Rs.10 lakhs. This itself goes to show that the trial Court has mechanically passed the impugned order.
It is his further submission that accused had borrowed a sum of Rs.3,50,000/- and subsequently, she has repaid the said amount and there is no question of she borrowing an amount of Rs.25 lakhs. The complainant was not having the capacity to pay the said huge amount of Rs.25 lakhs. Because of his financial constraints and difficulties, he has sold his properties, which itself indicates that he was not having any capacity to lend the loan of Rs.25 lakhs to accused No.2. It is his further submission that no such amount has been borrowed. The accused had given the cheques as collateral security for an amount of Rs.3,50,000/- and the same have been misused by filling up the amount by the complainant. It is his further contention that all the cheques which have been produced bears the same date and no prudent man will issue so many cheques on the same day by mentioning different amounts, which creates doubt about the case of the complainant.
It is his further submission that the trial Court without appreciating the said factual matrix has come to a wrong conclusion and has wrongly convicted accused No.2 and even the first appellate Court reiterated the order of the learned Magistrate. The judgment of the appellate Court and the trial Court are contrary to law and material placed on record. On these grounds, he prayed to allow the petitions by setting aside the impugned orders and acquit the accused.
7. Per-Contra, learned counsel appearing on behalf of the respondent-complainant vehemently argued and submitted that the accused is a film producer and he had sold the properties and kept the said amount for production of the film. Because of unavoidable circumstances, he could not take up the project and in view of acquaintance with the accused, the said amount has been paid to her, but accused No.2 has not repaid the said amount.
It is his submission that for having taken loan of Rs.25 lakhs, a loan agreement dated 20.2.2015 has been executed by the accused and during the course of evidence the said document has not been disputed. Under such circumstances, the complainant has clearly established the fact that he has lent loan of Rs.25 lakhs to accused No.2.
It is his further submission that in the evidence of the accused before the Court below she has admitted the fact of issuance of 14 cheques and it bears the signature of the accused. When she admits issuance of cheques and the signatures on the cheques, then as per Section 20 of the Negotiable Instruments Act (hereinafter called as 'N.I.Act' for short), the complainant can fill up the same and make it a negotiable instrument. Hence, it cannot be said that she has not issued the cheque. Once she admits the signature on the cheque, the Court is duty bound to draw presumption as contemplated under Sections 118 and 139 of the N.I.Act.
It is submitted that notice of demand was made immediately after the cheques were dishonoured. The same has been served on accused No.2, but no reply was given by the accused. As such, an adverse inference has to be drawn to the contention taken up by the accused. Though the accused has taken up a contention that she has taken loan of Rs.3,50,000/- from the complainant and the same has been repaid by various instalments, nothing has been produced for having repaid the said amount. If really, she has taken the said amount and repaid, under such circumstances, she could have rebutted the same by cogent and acceptable evidence. In the absence of the same, it would establish the case of the complainant.
It is his further submission as regards the contention taken up by accused No.2 that as per the chart given by the Court below mentioning the cheque numbers and the amount, the total amount due would come to only Rs.10 lakhs, it is a typographical mistake and that the total amount would come to Rs.25 lakhs. The petitioneraccused No.2 has not made out any good grounds to interfere with the order passed by the Courts below and the same deserves to be confirmed. On these grounds, he prayed to dismiss the petitions.
8. I have carefully and cautiously gone through the submissions made by the learned counsel appearing for the parties and perused the records including the trial Court records.
9. On going through the evidence of P.W.1 complainant, in all the four cases, he has reiterated as to what has been stated in the complaint and he has been cross-examined at length. Though during the course of cross-examination it has been suggested that the said amount of Rs.3,50,000/- has been repaid and the cheques given as security have been misused, the said suggestions were denied. The accused got examined herself as D.W.1. In her evidence, recorded on 17.2.2016 in C.C.No.18795/2016 she has deposed that an amount of Rs.3,50,000/- has been received during the year 2013 and apart from that, she has not taken any loan and at that time, she had issued 7 blank signed cheques and 7 blank CTS cheques as security. After payment of the amount, she has not taken back the cheques given as security. She has also deposed that some of the cheques do not belong to her.
10. It is the specific case of the accused-petitioner that she has borrowed a sum of Rs.3,50,000/- during the year 2013 and the same has been repaid in instalments. But for the reasons best known to the accused, not even a single piece of paper has been produced to show that she has repaid the said amount. Be that as it may. It is her specific contention that the said cheques were given as a security for the loan of Rs.3,50,000/- and the same have been misused. Even the records indicate that immediately after dishonour of cheques the complainant got issued a legal notice and the same has been served on the accused. The fact of service of notice is not disputed by the accused. Immediately after the receipt of the notice, no reply has been given. If really, the said cheques have been given as security towards the loan of Rs.3,50,000/- and if the said amount has been repaid, no prudent man will keep quiet without responding to the notice. But for the reasons best known to her, she has not given any reply. Even it is the case of the complainant that for having taken the loan of Rs.25 lakhs, the accused has got executed a loan agreement dated 20.2.2015. During the course of evidence, the said document has been disputed, but no explanation has been given as to under what circumstance, the said document has been executed. In the absence of any explanation and reply, an adverse inference has to be drawn that the defence taken up by the accused is not genuine.
11. It is well settled proposition of law that when once the accused admits the signature on the cheques, then under such circumstance, the presumption mandated under Section 139 of the N.I. Act has to be drawn that it includes a presumption that there exists a legally enforceable debt or liability. Of course, this is in the nature of rebuttal presumption it is open to the accused to raise a defense wherein, the existence of legally enforceable debt or liability can be contested. This proposition of law has been laid down by the Hon'ble Apex Court in the case of Rangappa Vs. Sri.Mohan, (2010) 11 SCC 441, wherein at paragraph 26 it has been observed as under:-
"26. In light of these extracts, we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat, (2008) 4 SCC 54 : (2008) 2 SCC (Cri) 166] may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant."
Keeping in view the ratio laid down in the above decision, if the factual matrix are taken into consideration, though the accused has contended that she has issued the cheques as Security and the same have been misused by the complainant but once, she admits the signature, the presumption has to be drawn that the said cheques have been issued in discharge of debt or liability and it is also corroborated with Ex.P23 the loan agreement to show that the loan amount has been taken. In the absence of rebuttal evidence, it has to be held that the accused has taken the loan and for discharge of the said loan, the said cheques have been issued.
12. It is also well settled proposition of law that Section 139 of the N.I. Act introduces an exception to the general rule as to the burden of proof and shifts the onus on the accused to prove by cogent evidence that there was no debt or liability. Mere denial or rebuttal by the accused was not enough. This proposition of law has been laid down by the Hon'ble Apex Court in the case of Bir Singh v. Mukesh Kumar, (2019) 4 SCC 197, wherein at paragraphs 18, 20 and 24 reads as under:
"18. In passing the impugned judgment and order dated 21-11-2017 [Mukesh Kumar v. Bir Singh,2017 SCCOnLineP&H 5352], the High Court misconstrued Section 139 of the Negotiable Instruments Act, which mandates that unless the contrary is proved, it is to be presumed that the holder of a cheque received the cheque of the nature referred to in Section 138, for the discharge, in whole or in part, of any debt or other liability. Needless to mention that the presumption contemplated under Section 139 of the Negotiable Instruments Act, is a rebuttable presumption. However, the onus of proving that the cheque was not in discharge of any debt or other liability is on the accused drawer of the cheque.
20. Section 139 introduces an exception to the general rule as to the burden of proof and shifts the onus on the accused. The presumption under Section 139 of the Negotiable Instruments Act is a presumption of law, as distinguished from presumption of facts. Presumptions are rules of evidence and do not conflict with the presumption of innocence, which requires the prosecution to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumptions of law and presumptions of fact unless the accused adduces evidence showing the reasonable possibility of the nonexistence of the presumed fact as held in Hiten P. Dalal [Hiten P. Dalal v. Bratindranath Banerjee, (2001) 6 SCC 16 : 2001 SCC (Cri) 960] .
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24. In K.N. Beena v. Muniyappan [K.N. Beena v. Muniyappan, (2001) 8 SCC 458 : 2002 SCC (Cri) 14] , this Court held that in view of the provisions of Section 139 of the Negotiable Instruments Act read with Section 118 thereof, the Court had to presume that the cheque had been issued for discharging a debt or liability. The said presumption was rebuttable and could be rebutted by the
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accused by proving the contrary. But mere denial or rebuttal by the accused was not enough. The accused had to prove by cogent evidence that there was no debt or liability. This Court clearly held that the High Court had erroneously set aside the conviction, by proceeding on the basis that denials/averments in the reply of the accused were sufficient to shift the burden of proof on the complainant to prove that the cheque had been issued for discharge of a debt or a liability. This was an entirely erroneous approach. The accused had to prove in the trial by leading cogent evidence that there was no debt or liability." 13. By going through the ratio laid down in the above decisions and on perusal of records, though it is contended by the accused that an amount of Rs.3,50,000/- has been repaid but no documents have been produced to substantiate the said fact. It is contended that the said cheques have been taken as a security for the amount of Rs.3,50,000/- and the same have been misused. I am surprised to say that if an amount of Rs.3,50,000/- has been taken and nearly about 20 cheques have been issued that itself is an unbelievable and unacceptable fact. This indicates that the defense taken is not an acceptable one and is a false defense. 14. Taking into consideration of the above said facts and circumstances, I am of the considered opinion that the petitioner-accused No.2 has not made out any good grounds so as to interfere with the judgment of the trial Court. The judgment of the trial Court deserves to be confirmed. 15. In that light, the revision petitions being devoid of merits, same are liable to be dismissed and accordingly, they are dismissed.