Zuber Ahmed Saeed Lulat vs State Of Gujarat

                                                                                  NEUTRAL CITATION




     R/SCR.A/14461/2023                            JUDGMENT DATED: 03/11/2023

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              IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

    R/SPECIAL CRIMINAL APPLICATION (QUASHING) NO. 14461 of 2023


FOR APPROVAL AND SIGNATURE:


HONOURABLE MR. JUSTICE J. C. DOSHI

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1      Whether Reporters of Local Papers may be allowed                Yes
       to see the judgment ?

2      To be referred to the Reporter or not ?                         Yes

3      Whether their Lordships wish to see the fair copy               No
       of the judgment ?

4      Whether this case involves a substantial question               No
       of law as to the interpretation of the Constitution
       of India or any order made thereunder ?

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                          ZUBER AHMED SAEED LULAT
                                   Versus
                             STATE OF GUJARAT
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Appearance:
MR PUSHPADATTA VYAS(1296) for the Applicant(s) No. 1
for the Respondent(s) No. 2
MR KM ANTANI, APP for the Respondent(s) No. 1
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    CORAM:HONOURABLE MR. JUSTICE J. C. DOSHI

                               Date : 03/11/2023

                              ORAL JUDGMENT

1. Heard learned advocate Mr. Pushpadatta Vyas for the petitioner.

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2. By way of this petition filed under section 482 of Cr.P.C. read with Article 226 and 227 of the Constitution of India, the petitioner prays for following reliefs in para 7:-

"(A) Your Lordship be pleased to call for R & P of the complaint filed by respondent no.2 in the Court of Ld. Judicial Magistrate First Class, Valia, District Bharuch bearing Criminal Case No.691/2021 under section 138 of the Negotiable Instrument Act at Annexure A and quash the same as well as quash the order at Annexure A collectively dated 15/05/2023 and order dated 14/10/2023 at Annexure H with any further proceeding thereof in the interest of justice.

(B) During the pendency admission and final disposal of the petition, Your Lordship be pleased to stay the complaint filed by respondent no.2 in the Court of Ld. Judicial Magistrate First Class, Valia, District Bharuch bearing Criminal Case No.691/2021 under section 138 of the Negotiable Instrument Act at Annexure A and further orders as well proceeding thereof.

          (C)     The cost of this petition be granted.


          (D)     Your Lordship be pleased to grant such other and

further reliefs that is just, fit and proper in the facts and circumstances of the case."

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3. For the purpose of admissibility of this petition, relevant facts are stated thus :-

3.1. Respondent no.2 has filed Criminal Case No.691 of 2023 before the learned JMFC, Valiya under section 138 of N.I.Act alleging that as many as 4 cheques totaling Rs.28 lakhs given by the petitioner have been return unpaid. Amount of cheques are not paid even after statutory notice was served (Annexure A). Complainant has filed private complaint alleging offence under section 138 of N.I.Act against the petitioner.

3.2. Learned JMFC, Valiya has issued process against the present petitioner. Process was challenged by way of Criminal Revision Application No.94 of 2023 before the learned District Court, Bharuch. Detail and comprehensive judgment therein did not find favour the petitioner. Thus, the petitioner is before this Court by way of this petition seeking above quoted reliefs.

4. Learned advocate Mr.Vyas for the petitioner referring to judgment in the case of Haji Iqbal @ Bala v/s. State of Uttar Pradesh [2023 (0) AIJEL-SC 72165] and Girishbhai Ambalal Rathod v/s. State of Gujarat [2023(0) AIJEL-HC 247138] would submit that it was duty of the Court to look into the matter and attentive circumstances emerging from the record of the case, over and above averments, if it is found that filing of complaint is vexatious and frivolous proceedings, the Court may quash by reading the complaint / FIR in between the lines.

NEUTRAL CITATION R/SCR.A/14461/2023 JUDGMENT DATED: 03/11/2023 undefined 4.1. Elaborating his submissions, learned advocate for the petitioner would submit that averments made in the complaint (Annexure A) as well as statutory notice (Annexure B) indicates transaction regarding flat No.C/202 to C/206 of the Royal Residency for the purpose of issuance of cheque in question. He would further submit that according to complaint and averments made therein, 4 cheques totaling Rs.28 lakhs were given to the original complainant for the purpose of selling flat No.C/202 to C/206 of Royal Residency and since said cheque returned unpaid, complaint came to be filed.

4.2. Learned advocate would also refer to page no.104 of the compilation to submit that agreement was executed between complainant and petitioner which indicates that questioned cheques were issued towards flat No.C/402 to C/406 of Royal Residency. This submission is made to argue that there is stark difference in transaction stated in agreement at Page no.104 and complaint (Annexure A) regarding flats for which alleged issuance of cheques took place. Therefore, he would submit that cheques in question are not issued for existing debt or liability. In short, it is submitted that according to complainant, cheques in question were given towards transaction of flat Nos.C/202 to C/206 of Royal Residency but the documents at Page No.104 and exhibited on record of Trial Court indicates that cheques were issued towards flat Nos.C/402 to C/406. It is submitted that in view of such fact there does not exist legal and enforceable debt or liability as claimed in complaint and therefore, it is not needed to send accused into trial.

NEUTRAL CITATION R/SCR.A/14461/2023 JUDGMENT DATED: 03/11/2023 undefined 4.3. Upon above submissions, it is submitted to allow this petition and to quash and set aside process issued against the petitioner.

5. On the other hand, learned APP would submit and support order of issuance of process.

6. Having heard learned advocate for the petitioner, at the outset, it is noticed that against the petitioner Criminal Case is filed under section 138 of N.I.Act. The Court after prima facie verifying material on record issued process for the offence punishable under section 138 of N.I.Act. The trial of the offence is at large before the learned Trial Court. It is to be noticed that in offence under section 138 of N.I.Act, provision of law provides for presumption under section 139 of N.I.Act which reads as under :-

"139. Presumption in favour of holder.--It shall be presumed, unless the contrary is proved, 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."

6.1. So it raises presumption in favour of the complainant that he has received cheques of nature referred in section 138 of the N.I.Act for discharge of debt, in whole or in part or any other liability. The complainant being holder of the cheques and in view of the fact that signature on the cheques is not denied by Page 5 of 13 Downloaded on : Tue Nov 07 20:37:02 IST 2023 NEUTRAL CITATION R/SCR.A/14461/2023 JUDGMENT DATED: 03/11/2023 undefined the accused / petitioner, legal presumption shall be drawn that cheques were issued for discharge of debt or any other liability. This presumption stands till it has been discharged. Presumption under section 139 is rebuttable presumption. It is system of reverse onus burden.

7. In case of M.S.Narayana Menon v/s. State of Kerala [(2006) 6 SCC 39], the Hon'ble Apex Court has considered sections 118(a), 138 and 139 of Negotiable Instrument Act and held that presumption both under section 118(a) and 139 are rebuttable in nature. Explaining expression "may presume" and "shall presume", referring to earlier judgment, following was held in para 28 which reads as under :-

"28. What would be the effect of the expressions "may presume", 'shall presume" and "conclusive proof" has been considered by this Court in Union of India v. Pramod Gupta, (2005) 12 SCC 1, in the following terms: (SCC pp. 30-31, para

52) "It is true that the legislature used two different phraseologies 'shall be presumed' and 'may be presumed' in Section 42 of the Punjab Land Revenue Act and furthermore although provided for the mode and manner of rebuttal of such presumption as regards the right to mines and minerals said to be vested in the Government vis-à-vis the absence thereof in relation to the lands presumed to be retained by the landowners but the same would not mean that the words 'shall presume' would be conclusive. The meaning of the expressions 'may presume' and 'shall presume' have been explained in Section 4 of the Evidence Act, 1872, from a perusal whereof it would be evident that whenever it is directed that the court shall presume a fact it shall regard such fact as proved unless disproved. In terms of the said provision, thus, the expression 'shall presume' cannot be held to be synonymous with 'conclusive proof'."

8. Further it was noted that expression "shall presume" cannot be equated with conclusive proof. Referring to definition Page 6 of 13 Downloaded on : Tue Nov 07 20:37:02 IST 2023 NEUTRAL CITATION R/SCR.A/14461/2023 JUDGMENT DATED: 03/11/2023 undefined "proved" and "disproved" under section 3 of the Evidence Act, in para 30, the Hon'ble Apex Court has held as under :-

"30. 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 does 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."

9. In Kumar Exports v/s. Sharma Carpets [(2009) 2 SCC 513], the Hon'ble Apex Court again examined as to when complainant discharges the burden to prove that instrument was executed and when the burden shall be shifted. Para 18 to 20 are relevant, which reads as under :-

in Section 3 of the Evidence Act to the provisions of Sections 118 and 139 of the Act, it becomes evident that in a trial under Section 138 of the Act a presumption will have to be made that every negotiable instrument was made or drawn for consideration and that it was executed for discharge of debt or liability once the execution of negotiable instrument is either proved or admitted. As soon as the complainant discharges the burden to prove that the instrument, say a note, was executed by the accused, the rules of presumptions under Sections 118 and 139 of the Act help him shift the burden on the accused. The presumptions will live, exist and survive and shall end only when the contrary is proved by the accused, that Page 7 of 13 Downloaded on : Tue Nov 07 20:37:02 IST 2023 NEUTRAL CITATION R/SCR.A/14461/2023 JUDGMENT DATED: 03/11/2023 undefined is, the cheque was not issued for consideration and in discharge of any debt or liability. A presumption is not in itself evidence, but only makes a prima facie case for a party for whose benefit it exists.

19. The use of the phrase "until the contrary is proved" in Section 118 of the Act and use of the words "unless the contrary is proved" in Section 139 of the Act read with definitions of "may presume" and "shall presume" as given in Section 4 of the Evidence Act, makes it at once clear that presumptions to be raised under both the provisions are rebuttable. When a presumption is rebuttable, it only points out that the party on whom lies the duty of going forward with evidence, on the fact presumed and when that party has produced evidence fairly and reasonably tending to show that the real fact is not as presumed, the purpose of the presumption is over.

20. ........................The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the court need not insist in every case that the accused should disprove the non-existence of consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that bare denial of the passing of the consideration and existence of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumptions, the accused should bring on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist..............."

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10. Noting various judgments including well celebrated judgment in the case of Rangappa v/s. Sri Mohan [(2010) 11 SCC 441, the Hon'ble Apex Court in Basalingappa v/s. Mudibasappa [2019 (5) SCC 418] summarized the principle as under :-

"23. We having noticed the ratio laid down by this Court in above cases on Sections 118(a) and 139, we now summarise the principles enumerated by this Court in following manner:-

(i) Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.

(ii) The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities.

(iii) To rebut the presumption, it is open for the accused to rely on evidence led by him or accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely.

(iv) That it is not necessary for the accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a persuasive burden.

(v) It is not necessary for the accused to come in the witness box to support his defence."

11. Recently, in the case of Jain P. Jose v/s. Santosh [2022 Live Law (SC) 979] the Hon'ble Apex Court has observed as Page 9 of 13 Downloaded on : Tue Nov 07 20:37:02 IST 2023 NEUTRAL CITATION R/SCR.A/14461/2023 JUDGMENT DATED: 03/11/2023 undefined follows :-

"Referring the Sections of the N.I. Act, a three Judges Bench of this Court in "T. Vasanthakumar Vs. Vijaykumari" (2015) 8 SCC 378, has held:

"9. Therefore, in the present case since the cheque as well as the signature has been accepted by the accused- respondent, the presumption under Section 139 would operate. Thus the burden was on the accused to disprove the cheque or the existence of any legally recoverable debt or liability. To this effect, the accused has come up with a story that the cheque was given to the complainant long back in 1999 as a security to a loan; the loan was repaid but the complainant did not, return the security cheque. According to the accused, it was that very cheque used by the complainant to implicate the accused. However, it may be noted that the cheque was dishonoured because the payment was stopped and not for any other reason. This implies that the accused had knowledge of the cheque being presented to the bank, or else how would the accused have instructed her banker to stop the payment. Thus, the story brought out by the accused is unworthy of credit, apart from being unsupported by any evidence.

This decision, refers to an earlier judgment of this Court in "Rangappa vs. Sri Mohan" (2010) 11 SCC 441, which elucidating on the presumption under Section 139 of the N.I. Act, observes that this includes a presumption that there exists a legally enforceable debt or liability. However, the presumption under Section 139 of the N.I. Act is rebuttable and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested.

A recent decision of a three Judges Bench of this Court in "Kalamani Tex and Another vs. P. Balasubramanian" (2021) 5 SCC 283, examines the scope and ambit of the presumption under Sections 118 and 139 of the N.I. Act, to hold:

NEUTRAL CITATION R/SCR.A/14461/2023 JUDGMENT DATED: 03/11/2023 undefined "14. Once the 2nd appellant had admitted his signatures on the cheque and the deed, the trial Court ought to have presumed that the cheque was issued as consideration for a legally enforceable debt. The trial Court fell in error when it called upon the respondent complainant to explain the circumstances under which the appellants were liable to pay. Such approach of the trial Court was directly in the teeth of the established legal position as discussed above, and amounts to a patent error of law.

xx xx xx

17. Even if we take the arguments raised by the appellants at face value that only a blank cheque and signed blank stamp papers were given to the respondent, yet the statutory presumption cannot be obliterated. It is useful to cite "Bir Singh v. Mukesh Kumar", where this court held that:

"Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under Section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt."

12. Looking back to the contention raised by the petitioner, it is the case of the petitioner that there is difference in agreement to sell and complaint regarding number of flats and therefore, it cannot be said that questioned cheques were given for discharge of any liability. This argument was canvassed with a view to submit that transaction is different. Cheques in question is given for transaction for flat Nos.C/402 to C/406 as per agreement on record but the complainant has mentioned that cheques in question has been given for transaction for flat Nos.C/202 to C/

206. Mere there is difference regarding flat numbers in agreement and complaint, it would not attract submission that Page 11 of 13 Downloaded on : Tue Nov 07 20:37:02 IST 2023 NEUTRAL CITATION R/SCR.A/14461/2023 JUDGMENT DATED: 03/11/2023 undefined cheques were not given for any legal liability. There may be typographical mistake. Since trial is at large before the learned Trial Court, this Court is not putting some more reasons for denying the case of the petitioner as it would prejudicially effect defence of the petitioner, but the fact remains that contention of the petitioner can be a defence which can be raised to discharge presumption under section 138 of NI Act and rebut it to prove that cheques are not given for transaction alleged in the complaint but for other transaction. Important to note that the petitioner has not denied issuance of cheques nor has denied his signature on cheques. Thus, at this juncture presumption under section 138 of NI Act is favouring the complainant and it can be presumed that questioned cheques were given for legally enforceable debt or liability as envisaged under section 138 of NI Act. Burden can be discharged under section 139 of NI Act by the petitioner after leading evidence either by cross examining the complainant or by leading necessary evidence. No mala fide or vexatious claim are found. The case deserves trial. No case is made to exercise power vested under section 482 of Cr.P.C. to quash the proceedings.

13. Needless to say that jurisdiction under section 482 of Cr.P.C. or Article 226 of the Constitution of India is requires to be exercised in circumspection and sparingly. The person calling Court to exercise such jurisdiction needs to establish from record that proceedings against him is manifestly mala fide and vexatious. In the present case, as noted earlier the petitioner has failed to make out such case.

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14. In wake of above reasons, the petition does not deserve consideration and requires to be dismissed in limine. Accordingly, the petition is dismissed.

(J. C. DOSHI,J) SATISH Page 13 of 13 Downloaded on : Tue Nov 07 20:37:02 IST 2023