Gujarat High Court
Ambika Ornaments Through Piyushbhai ... vs Rahul Ramniklal Shah on 13 February, 2025
NEUTRAL CITATION
R/CR.MA/4596/2023 ORDER DATED: 13/02/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL MISC. APPLICATION NO. 4596 of 2023
(FOR LEAVE TO APPEAL)
In
R/CRIMINAL APPEAL NO. 541 of 2023
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AMBIKA ORNAMENTS THROUGH PIYUSHBHAI CHAMPAKBHAI
SHAH (PIYUSHBHAI CHAMPAKBHAI VALANI)
Versus
RAHUL RAMNIKLAL SHAH & ANR.
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Appearance:
PRIYAL YATIN SHAH(8996) for the Applicant(s) No. 1
MR BHARGAV PANDYA, APP for the Respondent(s) No. 2
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CORAM:HONOURABLE MS. JUSTICE S.V. PINTO
Date : 13/02/2025
ORAL ORDER
1. The present application is filed by the applicant - original complainant under Section 378(4) of the Code of Criminal Procedure, 1973 (for short "Cr.P.C.") seeking leave to file an appeal against the judgment and order dated 28.12.2022 passed by the learned Additional Chief Metropolitan Magistrate, Negotiable Instruments Act Court No.34, Ahmedabad in Criminal Case No. 307 of 2016, whereby the original accused - respondent No. 2 herein came to be acquitted from the charge levelled against him under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as 'the N.I.Act"). Page 1 of 10 Uploaded by F.S. KAZI(HC01075) on Thu Feb 13 2025 Downloaded on : Thu Feb 13 23:09:24 IST 2025
NEUTRAL CITATION R/CR.MA/4596/2023 ORDER DATED: 13/02/2025 undefined The respondent No 2 is hereinafter referred to as "the accused"
as he stood in the original case for the sake of convenience, clarity and brevity.
2. The brief facts culled out from the memo of the present application as well as the impugned judgment and order and paper book filed by the applicant are as under:
2.1. The applicant is doing the business of gold and silver ornaments in the name of Shree Ambika Ornaments and the accused is also into the business of gold and silver ornaments.
That on 25.05.2015 the accused purchased silver ornaments of 6 kilos 336 grams at the rate of Rs.32,503/- and the amount of Rs.2,08,000/- was to be paid within one month. The applicant demanded the amount of Rs.2,08,000/- from the accused and the accused gave cheque No.919410 dated 04.07.2015 for Rs.2,08,000/- of his account with Dena Bank, Relief Road, Ahmedabad Branch. The cheque was deposited by the applicant in his account with Vijaya Bank, Manek Chowk, Ahmedabad Branch on 04.07.2015 but the cheque returned unpaid with the endorsement "Funds Insufficient" on 07.07.2015. The applicant gave the statutory demand notice through his advocate on 26.07.2015 which was duly served to the accused, but the accused did not repay the amount and sent a false reply and Page 2 of 10 Uploaded by F.S. KAZI(HC01075) on Thu Feb 13 2025 Downloaded on : Thu Feb 13 23:09:24 IST 2025 NEUTRAL CITATION R/CR.MA/4596/2023 ORDER DATED: 13/02/2025 undefined hence the complainant filed the complaint before the court of the Chief Metropolitan Magistrate, Ahmedabad. 2.2. The accused was served with the summons and appeared before the learned Trial Court and his plea was recorded at Exh.07 and the evidence of the applicant was taken on record. The applicant was examined on oath and 12 documentary evidences were produced in support of his case and the accused produced 01 document in his defence and after the closing pursis was filed, the further statement of the accused under Section 313 of the Code of Criminal Procedure was recorded, wherein the accused stated that the facts in chief examination and in the complaint are false. The disputed cheque was very old and applicant has filled the details in the cheque himself by forging the cheque and the return memo has been wrongly obtained. The bill at Exh.14 is false and concocted false evidence and the bill was not proved. The accused pleaded that he is innocent and has not committed offence and a false complaint has been filed by the applicant by forging the cheque and fabricating/concocting the evidence to take social revenge and he does not deal in silver or gold but is in the business of graphics. The arguments of the advocates for both the parties were heard and by impugned judgment and order, the learned Page 3 of 10 Uploaded by F.S. KAZI(HC01075) on Thu Feb 13 2025 Downloaded on : Thu Feb 13 23:09:24 IST 2025 NEUTRAL CITATION R/CR.MA/4596/2023 ORDER DATED: 13/02/2025 undefined Trial Court acquitted the accused from the offence under Section 138 of the N.I.Act.
3. Being aggrieved and dissatisfied with the same, the applicant has preferred the present application seeking leave to appeal mainly stating that the learned Trial Court has not properly interpreted the evidence and has misread the evidence and the impugned judgment is perverse, erroneous and contrary to law.
4. Heard learned advocate Priyal Yatin Shah appearing for the applicant and learned APP Ms. Jirga Jhaveri for the respondent - State.
5. Learned Advocate Ms Priyal Yatin Shah for the applicant has submitted that the learned Trial Court has ignored the evidence on record and has not appreciated that the applicant has proved the case beyond reasonable doubt. The learned Trial Court has not appreciated the provisions of Section 118 and 139 of the NI Act and has ignored the fact that the signature of the cheque is not disputed by the accused. The applicant has a good case on merits and leave to appeal must be granted.
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6. Learned APP Mr.Bhargav Pandya for the respondent State has submitted that the learned Trial Court has considered all the documents produced by the applicant and has also considered the evidence and has passed the impugned order of acquittal considering the settled principles of law and hence the leave to appeal may not be granted.
7.1. With regard to the facts in the present case, we can also refer to the following observations made Apex Court in Rangappa vs Sri Mohan reported in (2010) 11 SCC 441 in Para 14 wherein it is observed as under:
"14. 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 (supra) 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. Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused/defendant cannot be expected to discharge an unduly Page 5 of 10 Uploaded by F.S. KAZI(HC01075) on Thu Feb 13 2025 Downloaded on : Thu Feb 13 23:09:24 IST 2025 NEUTRAL CITATION R/CR.MA/4596/2023 ORDER DATED: 13/02/2025 undefined high standard of proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under Section 139, the standard of proof for doing so is that of 'preponderance of probabilities. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own."
7.2. The Apex Court in Tedhi Singh vs Narayan Dass Mahant reported in (2022) 6 SCC 735 has observed as under:
"7. It is true that this is a case under Section 138 of the Negotiable Instruments Act. Section 139 of the N.I. Act provides that Court shall presume 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. This presumption, however, is expressly made subject to the position being proved to the contrary. In other words, it is open to the accused to establish that there is no consideration received. It is in the context of this provision that the theory of 'probable defence' has grown. In an earlier judgment, in fact, which has also been adverted to in Basalingappa (supra), this Court notes that Section 139 of the N.I. Act is an example of reverse onus [see (2010) 11 SCC 441). It is also true that this Court has found that the accused is not expected to discharge an unduly high standard of proof. It is accordingly that the principle has developed that all which the accused needs to establish is a probable defence. As to whether a probable defence has been established is a matter to be decided on the facts of each case on the conspectus of evidence and circumstances that exist. "
7.3. The Apex Court in the case of Basalingappa vs. Mudibasappa reported in 2019 0 AIR (SC) 1983 has observed in Para 23 and 28 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:Page 6 of 10 Uploaded by F.S. KAZI(HC01075) on Thu Feb 13 2025 Downloaded on : Thu Feb 13 23:09:24 IST 2025
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(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.
24. xxxx
25. xxxx
26. xxxx
27. xxxx
28. We are of the view that when evidence was led before the Court to indicate that apart from loan of Rs. 6 lakhs given to the Accused, within 02 years, amount of Rs. 18 lakhs have been given out by the complainant and his financial capacity being questioned, it was incumbent on the complainant to have explained his financial capacity. Court cannot insist on a person to lead negative evidence."
8. In light of the above settled principles of law and on perusal of the evidence produced by the applicant before the learned Trial Court the applicant has filed his examination in chief at Exh.4 and has narrated all the facts of the complaint on oath. The applicant has been cross examined at length and during the cross-examination the applicant has stated that he maintains books of accounts and pays income tax and files his Income Tax Returns. That he has not produced the extract of Page 7 of 10 Uploaded by F.S. KAZI(HC01075) on Thu Feb 13 2025 Downloaded on : Thu Feb 13 23:09:24 IST 2025 NEUTRAL CITATION R/CR.MA/4596/2023 ORDER DATED: 13/02/2025 undefined the entry to show that the amount is due from the accused. That he has not produced the Balance Sheet of the financial year 01.04.2015 to 31.03.2016 and the bill produced at Exh.14 does not bear the signature of the customer. The accused has sent a reply to the notice but the same is not produced on record and he has not declared the date and the quantity of goods taken by the accused.
8.1. The learned Trial Court has concluded that the applicant has not proved that the accused is doing the business of gold and silver, and the applicant has not proved that the goods mentioned in the bill produced at Exh.14 were received by the accused. The applicant has not clearly stated on which date the accused had taken what quantity of gold and silver ornaments and merely by production of the bill produced at Exh.14, it cannot be said that the goods were sold to the accused as the bill did not bear, the customer's signature and the applicant did not produce the Rojmel, original books of accounts and the original stock statement. The accused had sent a reply to the notice and had denied all the facts stated by the applicant and had also raised the issue that his cheque book was lost before the competent authority and has raised raised a probable defence and successfully rebutted the presumption. Page 8 of 10 Uploaded by F.S. KAZI(HC01075) on Thu Feb 13 2025 Downloaded on : Thu Feb 13 23:09:24 IST 2025
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9. Moreover, the learned Trial Court has considered all the documents produced by the applicant and has also considered that the defence of accused is believable and applicant had not produced any cogent evidence to disbelieve the defence of accused and has not produced any evidence in support of written arguments submitted by the applicant. The applicant has failed to prove his recoverable debt and the applicant has failed to prove beyond reasonable doubt that the cheque in question was given as repayment of a legal debt as the cheque book with series number of the cheque was lost and a publication was also given to the competent authority.
10. The learned Trial Court has relied upon the law laid down by the Apex Court in the case of Basalingappa (supra) and the observation made in Para-11 in the case of Kumar Export vs Vinod Sharma reported in 2009 (2) GLR 1240 and in light of the same, the learned Trial Court has concluded that the accused has successfully rebutted the presumption based on preponderance of probability under Section 139 of the N.I.Act and the applicant had not came with clean hands and has not proved his case beyond reasonable doubt. In light of the above observation, the learned Trial Court has passed the impugned Page 9 of 10 Uploaded by F.S. KAZI(HC01075) on Thu Feb 13 2025 Downloaded on : Thu Feb 13 23:09:24 IST 2025 NEUTRAL CITATION R/CR.MA/4596/2023 ORDER DATED: 13/02/2025 undefined judgment and order of acquittal, which is just and proper and does not require any interference of this Court.
11. Consequently, the present application seeking leave to present an appeal under Section 378(4) of the Code of Criminal Procedure fails and is hereby dismissed.
12. Since the leave to prefer appeal is rejected, no order is required to be passed in the Criminal Appeal, which is at filing stage and the same stands disposed accordingly.
(S. V. PINTO,J) F.S.KAZI Page 10 of 10 Uploaded by F.S. KAZI(HC01075) on Thu Feb 13 2025 Downloaded on : Thu Feb 13 23:09:24 IST 2025