Shaikh Farooq Shaikh Amir Bagwan vs Shaikh Rafiq Shaikh Ayyub And ...
2016 Latest Caselaw 5350 Bom

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          IN  THE HIGH COURT OF JUDICATURE AT BOMBAY 

                                   BENCH AT AURANGABAD




                                                  
                         CRIMINAL APPEAL NO.172 OF 2014




                                                 
     Shaikh Farooq s/o. Shaikh Amir Bagwan,
     Age-43 years, Occu:Business,
     R/o-Sabjimandi, Paithan Gate,




                                         
     Aurangabad.
                                     ...APPELLANT
                              ig  (Orig. Complainant)

            VERSUS             
                            
     1) Shaikh Rafiq s/o. Shaikh Ayyub,
        Age-41 years, Occ:Business,
        R/o-Near Joshi Hospital, Kokadpura,
        Sabjimandi, Aurangabad.
      

                                     (Orig. Accused)
   



     2)   The State of Maharashtra   
                                     ...RESPONDENTS

                          ...





        Mr. Ajit D. Kasliwal, Advocate for  Appellant.
        Mr. Pathan Mohsin Khan, Advocate for Respondent 
        No.1.
        Mr. K.S. Hoke Patil, A.P.P. for Respondent  
        No.2.       





                          ...       


                   CORAM:   A.I.S. CHEEMA, J.

        DATE OF RESERVING JUDGMENT  : 5TH AUGUST, 2016  

        DATE OF PRONOUNCING JUDGMENT: 19TH SEPTEMBER, 2016
                                      




    ::: Uploaded on - 19/09/2016                  ::: Downloaded on - 20/09/2016 00:58:45 :::
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     JUDGMENT :

1. This Criminal Appeal has been filed by

the original complainant (hereafter referred as

"complainant") against the acquittal of Respondent

No.1 - original accused (hereafter referred as

"accused") in Summary Criminal Case No.820 of 2012

by J.M.F.C. Court No.20, Aurangabad on 27th June

2013 for offence punishable under Section 138 of

the Negotiable Instruments Act, 1881 ("the Act" in

brief).

2. The complaint filed by the complainant in

the trial Court claimed that the accused was

friend of the complainant and they had cordial

relations since long and also belong to same

community. In Ramzan of 2011 accused was in need

of money for his business and approached the

complainant with the request of hand-loan of

Rupees One Lakh. Considering the request of the

accused and the relations, complainant told the

accused that it was a huge amount and it would be

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preferable to execute an agreement. The accused

however, suggested that he will execute cheque of

hand-loan amount for repayment of hand-loan to

which Complainant agreed and gave hand-loan of

Rupees One Lakh in cash to accused. In discharge

of the liability to repay the hand-loan, the

accused executed cheque bearing No.000005 dated

1st October 2011 for Rupees One Lakh drawn on Bank

of Baroda, Branch Sabji Mandi, Aurangabad, in the

name of the complainant. Accused agreed to repay

the hand-loan on the given date of the cheque i.e.

1st October 2011. On the given date, complainant

presented the cheque but it returned unpaid with

memo dated 1st October 2011 with reason that

opening balance was insufficient. Complainant

informed this to the accused. Accused said that he

was expecting funds in December. As per

instructions of the accused, the complainant again

presented the cheque on 21st December 2011 but

again it was returned unpaid with memo dated 21st

December 2011 stating reason that the opening

balance was insufficient. Complainant issued

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demand notice dated 17th January 2012 by R.P.A.D.

through Advocate Shakeel Ahmed. Notice was served

on 19th January 2012 as on that date the postman

gave intimation to the accused but he avoided to

accept the notice. The amount remained unpaid and

thus the complaint dated 14th February 2012 was

filed.

3.

The trial Court explained particulars of

offence under Section 138 of the Act to the

accused. The accused pleaded not guilty. His

defence is of denial and as claimed in statement

under Section 313 of the Code of Criminal

Procedure, 1973 ("Cr.P.C." in brief) defence taken

was that blank cheque was issued only against an

amount of Rupees Five Thousand which was taken.

4. In the trial Court, the complainant filed

his affidavit at Exhibit 20 by way of examination-

in-chief on the above lines of the complaint.

Complainant came to be cross-examined. Complainant

proved the cheque Exhibit 23 which had been issued

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and the memo from the Bank dated 21st December

2011 at Exhibit 24. The money receipt for sending

the notice by Registered Post was proved at

Exhibit 25-C. Copy of the notice sent was proved

at Exhibit 35. From the unserved envelope Exhibit

26(1) trial Court appears to have taken out the

notice which was sent in the envelope. It turned

out that the notice did not bear any signature and

trial Court endorsed the document as not proved by

the complainant. Consequently, the complainant

examined C.W. No.2 - Advocate Shaikh Shakeel

Ahmed, who deposed regarding sending of the notice

by Registered Post A.D. and claimed that while

sending the notice, he did not see on the back

side of the notice and thus it remained unsigned

by him. It was noticed that there was over-writing

in the date of the copy of the notice Exhibit 35

where the printed date was scribbled and another

date of 17th January 2012 was written by hand.

This Advocate Shakeel Ahmed CW-2 claimed that on

5th January 2013 he had to file two examination-

in-chiefs in Court and wrongly in another matter

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of Imran vs. Ravi while preparing list of

documents, Exhibit 35 got wrongly listed and he

put the date of notice thinking it to be of that

matter and when he saw the addressee, he removed

the document Exhibit 35 from that matter and thus

he claimed that there was over-writing in date.

5. The complainant and his witness, both

were cross-examined. Trial Court considered the

evidence brought and after considering the

evidence and the defence, the trial Court passed

Judgment of acquittal.

6. I have heard learned counsel for both

sides. Learned counsel for the Appellant -

complainant made reference to the evidence and

claimed that the complainant should have been

believed when he deposed that the accused being

friend, was given an hand-loan and the cheque

given was dishonoured. The learned counsel

submitted that when it was not in dispute that the

accused did in fact issue the cheque and had

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signed the same, it was necessary to raise

presumption under Section 139 of the Act that the

cheque was issued towards legally enforceable

debt. According to the learned counsel in the

cross-examination of the complainant the

suggestions show that it was not disputed that for

money taken cheque was issued. According to the

counsel, the trial Court wrongly held that the

cheque had been issued by way of security only. It

was stated that the accused did not show for what

security the cheque had been issued. The defence

that only Rupees Five Thousand had been taken, was

put up only at the time of statement under Section

313 of Cr.P.C.

7. The counsel for the accused submitted

that there was no dispute that the accused had

taken loan but dispute was only if it was of

Rupees One Lakh. As stated by the accused in

statement under Section 313 of Cr.P.C. he had

taken amount only of Rupees Five Thousand.

Referring to the evidence of the complainant it

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was stated that when in the evidence complainant

claims that profit in business which he gets is of

only Rs.8,000 - 9,000/-, it was not proved by the

complainant that when he allegedly gave loan he

had the capacity to give loan of Rupees One Lakh.

The counsel stated that if for money given the

cheque was taken, it must be treated as for

security. The learned counsel relied on the case

of M.S. Narayana Menon Alias Mani vs. State of

Kerala and another, reported in (2006) 6 S.C.C.

39, to claim that in para 52 of the Judgment the

Hon'ble Supreme Court had observed that if a

cheque was issued for security or for any other

purpose the same would not come within the purview

of Section 138 of the Act. The counsel submitted

that it should be held that there was no notice as

the notice which was sent and allegedly not

received, was not signed by the Advocate. The

learned counsel supported the reasons recorded by

the trial Court and stated that the Appeal should

be dismissed. The counsel relied on the Judgment

in the matter of K. Prakashan vs. P.K. Surenderan,

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reported in 2008 All M.R. (Cri.) 314 (S.C.) and

referring to Para 13 of the Judgment stated that

even if presumptions under Section 118 (a) and

Section 139 of the Act were to be relied on the

standard of proof as far as prosecution is

concerned is to prove guilt beyond all reasonable

doubt while the one on the accused is only mere

preponderance of probability. Thus, referring to

the defence taken by the accused in his statement

under Section 313 of Cr.P.C. the counsel stated

that the accused discharged the onus which was on

him.

8. The learned counsel for the accused

further relied on the case of Sanjay Mishra vs.

Ms. Kanishka Kapoor @ Nikki & Anr., reported in

2009 All M.R.(Cri.) 1080, to submit that in that

matter it has been held that provisions of Section

138 of the Act can not be relied on to recover

unaccounted money. It is stated that in the

present matter complainant claimed to have lent

Rupees One Lakh and although complainant claims to

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be business-man, admittedly he does not pay any

income tax and at the time of evidence he tried to

claim that the amount was available with him from

sale proceeds of house but no such document was

proved.

9. The learned counsel for accused further

relied on the case of Sheshrao s/o. Krishnarao

Umredkar vs. Shri. H.K. Pande & Another, reported

in 2010 All M.R. (Cri.) 1446, to submit that it

has been held in that matter by this Court that

there can not be justification in disturbing the

order of acquittal unless there is a specific and

compelling reason to overturn the acquittal or

unless grave miscarriage of justice has resulted

from the impugned order of acquittal.

10. The learned counsel for accused further

referred to the case of Gundappa Virbhadrappa

Kalyani vs. Dnyandeo Shankarrao Jangle, reported

in 2007 All M.R. (Cri.) 1046, in which, on the

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facts of that matter, it was found that the legal

liability of the accused was not proved.

11. In reply, the learned counsel for the

complainant referred to the Judgment of the

Hon'ble Supreme Court in the matter of I.C.D.S.

Ltd. vs. Beemna Shabeer and another, reported in

A.I.R. 2002 S.C. 3014, in which matter the High

Court had concluded that when a cheque was issued

as security, no complaint would lie under Section

138 of the Act but Supreme Court did not agree.

That matter related to the hire purchase agreement

of Maruti Car and the Respondent No.1 wife had

stood guarantor for husband and issued cheque

which was dishonoured. The Hon'ble Supreme Court

found that the High Court fell into a manifest

error in such finding. The learned counsel for the

Appellant-complainant submitted that the Judgment

of the Hon'ble Supreme Court in the matter of

I.C.D.S. Ltd. (supra) has been followed by this

Court in the matter of Mrs. Heena Naresh Rupani

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vs. Sarita Nandlal Choudhari, reported in 2008 ALL

M.R.(Cri.) 3419, to held that proceeding under

Section 138 of the Act would lie even if the

cheque was issued towards liability as a guarantor

or by way of security. The counsel stated that the

Judgment of Hon'ble Supreme Court was further

followed in the matter of VPK Urban Co-operative

Credit Society Limited vs. Mrs. Nandini Shankar

Waingade & Another, reported in 2013 ALL M.R.

(Cri.) 1204, where considering the facts in that

matter this Court found that accused had failed to

rebut presumption under Section 139 of the Act.

The learned counsel for the complainant stated

that similar view has been taken in the matter of

Balagi Agencies Pvt. Ltd. vs. Mr. Violas Bagi of

Bagi Package Ltd. and another, reported in 2008

All M.R. (Cri.) 2230 where it was held that even

if the cheque was issued for security, the same

would come under the purview of Section 138 of the

Act.

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12. Learned counsel for the complainant

submitted that Judgment in the matter of Sanjay

Mishra vs. Ms. Kanishka Kapoor @ Nikki & Anr.,

cited supra, relied on by the accused was dealt

with in another Judgment of this Court in the

matter of Mr. Krishna P. Morajkar vs. Mr. Joe

Ferrao and another, reported in 2013 All M.R.

(Cri.) 4129 and this Court considered the effect

of the Judgment in the matter of Krishna Janardhan

Bhat vs. Dattatraya G. Hegde, reported in 2008 All

M.R. (Cri.) 1164 which was considered by the

Hon'ble Supreme Court in the matter of Rangappa

vs. Sri Mohan, reported in 2010 (11) S.C.C. 441.

In the Judgment in the matter of Krishna Janardhan

Bhat (supra), the Supreme Court had held that

existence of legally enforceable debt is not a

matter of presumption under Section 139 of the

Act. As far as this aspect was concerned, the

Judgment in the matter of Krishna Janardhan Bhat

was specifically overruled by the Three Judges

Bench of the Supreme Court in the matter of

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Rangappa vs. Sri Mohan (supra). Learned counsel

for complainant stated that this Court in the

matter of Mr. Krishna P. Morajkar (supra)

discussed the provisions under Section 269SS and

271D of the Income Tax Act which were dealt with

in the matter of Krishna Janardhan Bhat (supra)

as well as the Judgment in the matter of Sanjay

Mishra (supra) as well as the provisions under

Section 138 of the Act to find that there was no

prohibition to recover the amounts not disclosed

in the income tax returns. It was concluded in

para 31 of the Judgment that when a person signs a

cheque and delivers it, even if it is a blank

cheque or a post dated cheque, presumptions under

Section 118(b) and 139 of the Negotiable

Instruments Act would have to be raised and would

have to be rebutted by the accused, albeit by

raising a probability. Thus, according to the

learned counsel the claim of the complainant can

not be rejected merely because the transaction was

not shown in the income tax returns.

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13. Learned counsel for the complainant

further relied on the Judgment in the matter of T.

Vasanthakumar vs. Vijayakumari, reported in 2015

ALL M.R. (Cri.) 3667 (S.C.), which referred to the

ratio of Judgment in the matter of Rangappa vs.

Sri Mohan (Supra), in Para 9 as under:-

"9. This Court has held in its three judge

bench judgment in Rangappa v. Sri Mohan (2010) 11 SCC 441 : [2010 ALL SCR 1349]

"The presumption mandated by Section 139 includes a presumption that there

exists a legally enforceable debt or

liability. 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 respondent complainant."

. Relying on the Judgment, it was stated

that in the present matter it should be held that

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there was legally enforceable debt and presumption

under Section 139 of the Act needs to be raised

and burden is on the accused to show that no such

liability existed.

14. The learned counsel for the complainant

further relied on the Judgment in the matter of

Rajesh Chari vs. Zuari Structural Works, reported

in 2006 ALL M.R. (Cri.) 513, in which matter on

its facts it was held that the complainant in that

matter had proved his case and the accused failed

to rebut presumption under Section 139 of the Act.

15. Having heard counsel for both sides and

seen the various Judgments they are relying on, I

am keeping the law as is reflected from above

arguments and counter arguments in view and I

proceed to consider the facts of the present

matter to see if offence under Section 138 of the

Act is proved.

16. Before referring to the evidence, as this

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is an Appeal against acquittal, I am first making

reference to the findings recorded by the trial

Court. This would be necessary because if the view

taken by the trial Court of the evidence is a

possible view, there would be no justification for

me to interfere. The trial Court recorded in its

reasons that the fact of the accused issuing

cheque and signature thereon was not in dispute

except regarding the amount. Trial Court recorded

that the defence taken by accused is that he had

issued blank cheque only for Rupees Five Thousand.

After referring to the evidence of the complainant

and the notices, trial Court held that the

envelope Exhibit 26(1) showed that notice was

served on accused on 19th January 2012. Trial

Court observed that there was no dispute from the

side of the accused that the complaint was in

limitation. Trial Court considered evidence of the

complainant that he had deposed that he earns

Rs.8000 - 10,000/- per month and that he did not

pay income tax but still claims to have advanced

huge amount of Rupees One Lakh. The reason given

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by the complainant that due to cordial relations

the amount was given, was dealt with by the trial

Court. The trial Court considered that in the

cross-examination of the complainant he was asked

and even given opportunity to show that he had the

concerned amount but the complainant did not file

documents to show that indeed he had sold a house

and had the concerned money. Trial Court observed

that looking to the small income of the

complainant if the fact is juxtaposed with not

filing of the documents of sale of house, the

preponderance of probability was that the

complainant was not having that much money on the

alleged date when he claimed that he paid the

amount to the accused. Thus, the trial Court

concluded that the accused succeeded to rebut

presumption under Section 139 of the Act. Trial

Court observed that the complainant was making

different claims regarding sale of house and apart

from not filing the documents, complainant was

some time claiming that he advanced share to his

brother and some time claimed that the brother did

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not have share. Thus the trial Court doubted the

evidence of the complainant. Referring to the

evidence of the complainant, the trial Court found

that the cheque was given only by way of security.

Trial Court referred to the evidence to find that

the complainant and accused were in different

businesses and would not even meet often and that

there was no earlier transaction between them.

Trial Court did not accept the evidence that due

to cordial relations the money was advanced. The

cheque was given as a post-dated cheque and was

only as a security. Trial Court also found that

the Advocate examined by the complainant had given

improbable justification of inadvertent mistake in

over-writing in the date of notice Exhibit 35.

However, the trial Court found that the

explanation regarding not signing the copy of

notice sent in the envelope as probable. Still,

trial Court found that notice Exhibit 35 was

served on the accused. The trial Court held that

the accused had been able to show on preponderance

of probability that the complainant did not have

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the ability to give Rupees One Lakh and thus

according to the trial Court the cheque was only

as a security. Thus the trial Court held that it

was not proved that the cheque was issued towards

discharge of debt or legally enforceable

liability.

17. Keeping such findings of the trial Court

in view, I have gone through the evidence. The

complainant in cross-examination claimed that he

is running a hotel but does not pay any income

tax. He claimed that his business per day was

Rs.5000/- to Rs.6000/- but he claimed that he

earns profit in a month only Rs.8000/- to

Rs.10,000/-. Although it is not claimed in the

complaint, in cross-examination complainant stated

that the accused was his relative, without stating

as to what was the relation. The cross-examination

showed that the accused was not in hotel business

and earlier there was no transaction between them.

He admitted that as the accused and he are in

different business, they do not meet often.

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Complainant claimed that the money of Rupees One

Lakh was given to the accused in cash in the month

of Ramzan of 2011. His evidence is that when the

accused asked for the money, complainant told the

accused that it was a huge amount and it would be

preferable to execute an agreement. Thus,

admittedly for the complainant it was a huge

amount and he wanted an agreement to be executed.

He however appears to have settled for the cheque.

The evidence is that the accused had agreed to

repay the hand-loan on the given date of the

cheque. In cross-examination complainant claimed

that he delivered money to the accused at his

home. There is no corroborative evidence to such

evidence. Admittedly, the amount was huge for the

complainant to lend. No such thick relations are

shown for the complainant to advance such huge

amount to the accused. In the cross-examination

complainant stated that he had sold his house at

the concerned time and so he had money to advance

the same to the accused. Even if one was to sell a

house and had the money, it would not mean that

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the person would simply advance the money to

anybody. Trial Court found that cordial relations

so as to lend such amount were not proved. Apart

from there being no witness of the handing over of

such cash, the complainant inspite of cross-

examination on this count, did not bring any

evidence to show that he indeed had such money in

his possession.

18. The evidence of the complainant shows

that he tendered envelope Exhibit 26(1) in

evidence to say that the same was sent by his

Advocate and returned back unserved. The

complainant claimed that the notice was served on

the accused on 19th January 2012. The complainant

made this claim on the basis of endorsement of the

postman on the envelope. The endorsement behind

envelope Exhibit 26(1) shows two endorsements, one

is dated 19th January 2012 and another is dated

20th January 2012 with the heading of giving

intimation. Reading the evidence of the

complainant as well as his Advocate Shaikh Shakeel

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Ahmed, what appears is that such envelope Exhibit

26(1) was sent to the accused. It appears that in

the trial Court, from this envelope the notice

which was sent was taken out. Trial Court found

that the said notice did not bear any signature.

Consequently, it appears that on the date of 5th

January 2013 the trial Court endorsed on the

undated notice that it was not proved by the

complainant. It also endorsed that the notice did

not bear signature. It appears that the

complainant then called his Advocate Shaikh

Shakeel Ahmed who deposed at Exhibit 40 and after

his evidence, on the back side of the unsigned

notice it was marked as Exhibit 41 proved by CW-2.

Although the trial Court has held that the notice

Exhibit 35 was served on the accused, if Exhibit

41 the unsigned notice is seen which was taken out

from envelope Exhibit 26(1) which was sent to the

accused, what must be held is that an unsigned

document in the form of notice was sent. The law

raises presumption of service if the notice under

R.P.A.D. is refused. However, if the envelope

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Exhibit 26(1) is to be read with the unsigned

notice Exhibit 41, what could be said is that the

unsigned typed paper was sent to the accused in

the form of notice claiming to be from the

Advocate. When there is no signature of anybody,

it appears difficult to find that there is

compliance of clause (b) of Section 138 of the Act

which requires that notice should be given in

writing. If the Advocate was to write the notice

in his own hand, or if the complainant was to

write notice in his own hand and send in which

signature remains, it could be still said to be

notice of the Advocate or the complainant. But

when there is typed document in the form of Notice

with no signature (not even an initial) of

anybody, it cannot be said to be a legal notice.

Nobody could be said to own up the correctness of

the contents.

19. The trial Court found that the

complainant wanted a document of agreement

executed for the huge amount but accepted a cheque

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instead. The Judgment of the trial Court shows

that the cheque was thus taken as a security and

it also found that the complainant failed to prove

cordial relations between him and the accused and

thus it was improbable that the cheque issued was

towards legally enforceable debt. Going through

the material, it does not appear that there were

any such thick relations that the complainant

should have parted with what he himself says to be

a huge amount of Rupees One Lakh in favour of the

accused. The complainant further failed to show

that he did have capacity to lend such huge

amount. Complainant is not corroborated by any

other evidence other than his evidence that he had

such money and did handover such money to the

accused. In the cross-examination accused has

shown that complainant has failed to show

availability of such amount or capacity and also

that there were no such relations to lend such

huge amount. Thus the presumption putting onus on

accused is rebutted. Looking to the evidence on

record, I find myself in agreement with the trial

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Court that the complainant cannot be said to have

proved offence under Section 138 of the Negotiable

Instruments Act. Additionally, I am finding that

the service of legal notice itself is not proved

in this matter.

20. For such reasons, on facts, the offence

is not proved. Going through the Judgment of the

trial Court, I do not find any reason to interfere

in the acquittal recorded by the trial Court so as

to convert the same into conviction.

21. There is no substance in the Appeal. The

Appeal is dismissed.

[A.I.S. CHEEMA, J.]

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