M/S. Shri Sudarshan Industries, ... vs M/S. Shree Durga Trading Company, ...
2018 Latest Caselaw 486 Bom

 apeal232.14.J.odt                         1




          IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                    NAGPUR BENCH, NAGPUR

                      CRIMINAL APPEAL  NO.
                                         232
                                              O
                                                F 2014
                                                      

          M/s. Shri Sudarshan Industries
          Plot No. C-60, M.I.D.C. Wardha
          through its Proprietor
          Shri Radheshayam s/o Govindram
          Jajodiya (HUF),
          Aged about 81 years,
          Occ: Business, R/o Wardha,
          Tah. & Dist. Wardha.                               ....... APPELLANT

                                   ...V E R S U S...

 1]       Hygenic Palm Oil Private Limited,
          through

 a]       Shri Bharat Patel,

 b]       Shri Snehalbhai Patel,

          Both resident of Plot No.438/2,
          Kundal-Kadi, Kadi,
          District Mehsana.

 2]       M/s. Shree Durga Trading Company,
          through its Proprietor/Partner
          Shri Ashok Thanvi,
          R/o Akola Bazar, Khamgaon,
          Tah. Khamgaon, Dist. Buldhana.                     .......  RESPONDENT S          
 -------------------------------------------------------------------------------------------
          Smt. Anjali A. Joshi, Advocate for Appellant.
          Shri M.M. Agnihotri, Advocate for Respondent.
 -------------------------------------------------------------------------------------------

          CORAM:            ROHIT B. DEO , J.

          DATE:                th
                            16    JANUARY

                                             8    . 









 ORAL JUDGMENT



 1]               One   Shri   Ashok   Thanvi,   who   is   described   as 

Proprietor/Partner of M/s. Shree Durga Trading Company in

Criminal Complaint 3541/2005 under section 138 of the

Negotiable Instruments Act ('Act' for short) is acquitted by the

Chief Judicial Magistrate First Class, Wardha by judgment and

order dated 26.03.2013 which is impugned herein.

2] The complaint was instituted by the complainant

arraying Hygienic Palm Oil Private Limited through Shri Bharat

Patel and Shri Snehalbhai Patel as accused 1 and M/s. Shree

Durga Trading Company through Partner/Proprietor Shri Ashok

Thanvi as accused 2. The complainant could not secure the

presence of accused 1 whose trial was therefore separated.

3] The gist of the complaint is that the complainant

M/s. Sudarshan Industries, Wardha is a manufacturer of washed

cotton seed oil and other oils. In accordance with telephonic talk

with the accused, the said company dispatched 9835 kg. washed

cotton seed oil worth Rs.4,07,169/- on 27.06.2004 from Wardha

to accused 1. The necessary documents inter alia a provisional bill

in the name of accused 1 and advice letter for sale of goods were

dispatched along with the goods. Accused 2 is a broker carrying on

business under the trade name Shriji Broker, Shri Durga Trading

Company and Shri Balkrishna Traders. The complaint asserts that

Shri Ashok Thanvi may either the proprietor or the partner of the

said firm. The complaint further avers that it was accused 2 who

made the payment on behalf of accused 1 against the goods earlier

sold to accused 1.

The averment in the complaint is that accused 1 used

to sent said bill duly addressed to the complainant through

accused 2 along with F-form. However, as regards the relevant

transaction neither the sale bill nor the F-form was received by the

complainant. Accused 2 issued three cheques to the complainant

against the goods dispatched on 27.06.2004 in the name of

Shakambari Traders. Accused 2, as proprietor of Shri Durga

Trading Company issued the cheque 322127 dated 02.11.2004 for

Rs.2,25,000/- against the balance dues. The complainant

presented the cheque for payment on 19.04.2005, the said cheque

was dishonoured and the statutory notices were issued to both the

accused. Accused 1 replied asserting that payment was made to

accused 2 while accused 2 refused to accept the statutory notice.

4] The defence which emerges from the trend and tenor

of the cross-examination, statement recorded under section 313 of

the Criminal Procedure code and the evidence of D.W.1

Gokulchand Thanvi is thus. The proprietor of Shree Durga Trading

Company is D.W.2 Gokulchand Ishwardas Thanvi. Accused 2 has

no business relationship with either the complainant or accused 1.

Accused 2 has business relation with Shakambari Traders,

Khamgaon. An order for purchase of sesame was placed and the

disputed cheque which is signed by the son of D.W.1 one Ashok

Thanvi was towards the payment for the sesame to be supplied by

Shakambari Traders, Khamgaon. However, accused 2 was

informed by Shakambari Traders that the disputed cheque be

issued in the name of the complainant firm. The explanation given

by Shakambari Traders, Khamgaon was that the said firm owed

money to the complainant and the cheque be issued in the name

of the complainant. Shakambari Traders did not supply the sesame

and stop payment instructions were issued.

5] Perusal of the complaint reveals, that the version of

the complainant is that the part payment received against the

goods dispatched on 27.06.2004 was made by Balkrishna Traders

by cheque issued in favour of the complainant's relative 'M/s.

Shakambari Trading Company Limited, Khamgaon'.

The complainant asserts that the said M/s. Shakambari Trading

Company, Khamgaon remitted the amount of Rs.1,87,000/-

received as part payment of the transaction and the complainant

credited the said amount in the account, of accused 1.

6] C.W.1 Nandkishor Jajodiya has deposed broadly

consistent with the contents of the complaint. In the

cross-examination, it is extracted that no documentary evidence as

regards the transaction is produced on record. However, the advice

letter Exh.128 is proved during the cross-examination. The said

advice is issued to accused 1. C.W.1 admits that in the advice letter

the name of the agent is normally recorded. However, C.W.1

further admits that the name of the agent and other details are not

recorded in Exh.128 and the advice letter instructed accused 1 to

deposit the sale amount in the account of the complainant. C.W.1

admits that no documentary evidence is placed on record to prove

that the goods dispatched on 27.06.2004 were duly received by

accused 1. The suggestion that in the earlier transaction accused 1

made the payment by demand drafts is admitted with the rider

that the demand drafts were issued by accused 2 from the bank

account of accused 1. The defence of the accused is put to C.W.1

who has however, denied the suggestion that the disputed cheque

was issued against an advance order of purchase of sesame placed

with Shakambari Trading Company Limited and the said cheque is

misused. The suggestion that a broker is not liable to make the

payment is denied. It is suggested to the witness that Ashok

Thanvi is neither the proprietor nor the partner of Durga Trading

Company nor is Ashok Thanvi residing at the address mentioned

on the envelope containing the statutory notice. C.W.2 denies the

suggestion that since Ashok Thanvi did not reside at the said

address, the envelope was returned with the endorsement 'not

available'.

7] Gokulchand Ishwardas Thanvi stepped into the

witness box as D.W.1 and proved that he is the proprietor of Durga

Trading Company. D.W.1 asserted that Durga Trading Company is

a commission agent and the limited role is to facilitate the

transaction between the seller and the purchaser. D.W.1 asserted

that he is not acquainted with accused 1 or the complainant. D.W.1

states that his son Ashok Thanvi intended to issue a cheque in

favour of Shakambari Traders against future sale of sesame and

was told by Shakambari Traders to issue the cheque in the name of

the complainant. Shakambari Traders gave Ashok Thanvi to

understand that since Shakambari Traders owed some amount to

the complainant, the cheque may be issued in the name of the

complainant. The sesame was not supplied and stop payment

instructions were issued is the deposition. In the

cross-examination, it is extracted that the witness did not have

documentary evidence to prove the advance purchase transaction

with Shakambari Traders. However, the version of D.W.1 is that he

did not maintain record of such transactions.

8] The learned counsel for the complainant Smt. Anjali

Joshi relies on the judgment of the Apex Court in Rajneesh

Aggarwal v. Amit J. Bhalla AIR 2001 SC 518 to contend that the

statutory notice cannot be construed in narrow technical way.

The said judgment is brought to my notice since one of the

contentions of the accused is that the statutory notice is defective.

The statutory notice is addressed to M/s. Shree Durga Trading

Company, through proprietor/partner Ashok Thanvi who is

irrefutably neither proprietor nor partner of the said firm.

The Apex Court was construing a notice which was issued to the

Director of the Company who was the signatory of the cheque.

The learned counsel further relies on the judgment of the

Karnataka High Court in J. Ramaraj v. Iliyaz Khan 2007 (2) DCR

241 in support of the submission that an agent who issued the

cheque without indicating that he would not incur personal

responsibility is liable to be convicted under section 138 of the Act

if the cheque is dishonoured. Reliance is placed on the judgment

of a learned Single Judge of the Madras High Court G. Rukkumani

v. K. Rajendran 2001 Cri.L.J. 3120 in support of the contention

that if the proprietor of a private person permits the son to act as

an authorized signatory the proprietor is bound by such act and is

liable for offence under the Act. Smt. Anjali Joshi invites my

attention to the judgment of the Apex Court in Hiten P. Dalal v.

Bratindranath Banerjee AIR 2001 SC 3897 in support of her

submission that the accused failed to rebut the statutory

presumption under section 139 of the Act.

Shri Makrand Agnihotri, the learned counsel for the

appellant has relied on the judgment of a learned Single Judge of

this court in Hiten Sagar and another v. IMC Ltd. and another

2001(3) Mh.L.J. 659 and in particular to the following

observations in paragraph 3:

3. Para 7 of the complaint also makes it clear that in discharge of the liability of the petitioners 2 and 3, the cheque in question was drawn by the petitioner No. 1. In order to maintain the complaint under section 138 of the N.I. Act, the cheque must be issued in discharge of any liability. The question posed therefore is whether A can issue a cheque in discharge of the liability of B, inspite of the fact that the liability of B has been taken over by A. In the absence of any documents, creating the liability of petitioners 2 and 3 in favour of petitioner No. 1, mere statement that the cheque was issued by petitioner No. 1, for and on behalf of the petitioners 2 and 3 will not sufficient to give the cause of action for a complaint under section 138 of the N.I. Act. Even in the notice sent to the petitioner it has not been mentioned that the drawer of the cheque has taken over the liability of the petitioners 2 and 3. "Any liability" occurred in the section is only to mean that

any kind of liability of the drawer; and not any other's liability, unless the payee, the drawer and the original debtor entered into any agreement to that effect. In order to entertain a complaint, the Magistrate should have material before him to the effect that there is tripartite agreement in the above nature. Sometime, a surety of debtor will also issue a cheque. In that case also section 138 will attract in the case of dishonour. Here in this case we have only a unilateral lawyer notice which says that the petitioner had undertaken the liability of his brother Mr. Jignesh Sagar. It is well settled principle of criminal law that a penal provision of a statute has to be strictly constructed and if in a wider connotation it will amount disadvantage to the accused, such wider connotation cannot be accepted. On a reading of section 138 of the N.I. Act, it is clearly spelt out that a cheque must be drawn for discharge of the liability of the drawer of the cheque. In other words if he has drawn a cheque for the discharge of the liability of another person without creating any document, it will not and it would not come under section 138 of the N.I. Act.

9] The submission of the learned counsel for the

complainant Smt. Anjali Joshi that in view of the judgment of the

learned Single Judge of the Karnataka High Court an agent is

responsible for the dishonour of cheque, need not detain me for

long. Firstly, a broker whose only work is to facilitate the

transaction between two businessmen cannot be equated with an

agent of one of the party whose act may bind the principal.

There is absolutely no evidence on record to substantiate the

contention of the learned counsel that accused 2 was acting as an

agent of accused 1. Au contraire, the complaint refers to accused 2

as a broker or commission agent which in trade parlance would

imply a person who is not an agent of either of the two transacting

parties and whose role would be limited to facilitate the

transaction. That apart, as I have noted supra, there is no evidence

whatsoever to suggest that accused 2 acted as a broker for the

transaction. Concededly, the goods were sent to accused 1. It is the

case of the complainant, that the disputed cheque was issued by

accused 2 towards the payment of the goods sent by the

complainant to accused 1. It is not even the case of the

complainant that there is any other transaction in relation to

which the disputed cheque was issued. It was, therefore,

incumbent for the complainant to prove the existence of legally

enforceable debt or liability, since the accused has amply

probablized the defence that he was in no way responsible for the

payment of the goods delivered by the complainant to accused 1.

10] No evidence is produced by the complainant to

substantiate the contention that even on earlier occasions, when

goods were delivered to accused 1, the payment was made by

accused 2. C.W.1 admits that such payments were made by

demand drafts. The explanation that it was accused 2 who took

out the demand drafts from the account maintained by accused 1

must be noted only for rejection.

11] Smt. Anjali Joshi, the learned counsel for the

complainant however, is vehement in submitting that in view of

the statutory presumption under section 139 of the Act, the

accused 2 was under statutory burden to disprove the existence of

debt or liability. The disputed cheque is signed by Ashok Thanvi

and it is irrefutable that he is the son of the proprietor of

M/s. Shree Durga Trading Company. Since the signature on the

cheque is not disputed, Smt. Joshi is right in submitting that the

statutory presumption under section 139 is activated.

However, I am not inclined to agree with the further submission

that the statutory presumption is not rebutted. Shri Gokulchand

Thanvi the father of the signatory of the cheque, has stepped into

the witness box. Even dehors the defence evidence, it is well

settled that if the version of the complainant is ex facie improbable

and it is writ large on the face of the complaint or the evidence of

the complainant that the existence of debt or liability is highly

improbable, the statutory presumption under section 139 of the

Act is rebutted. The accused need not adduce direct evidence nor

need he step into the witness box. The burden to rebut the

statutory presumption can be discharged by relying on material

produced by the complainant or the material extracted in the

cross-examination of the complainant or the witnesses examined

on his behalf. In the teeth of the evidence, even if the defence

evidence is shut out from consideration, the case of the

complainant that the cheque was issued to discharge existing

liability or debt is highly improbable and indeed unacceptable.

In order to make out some semblance of existing liability, the

complainant ought to have proved that accused 2 acted as an

agent, and having done so, he was responsible for the non-receipt

of the sale consideration of the goods delivered to accused 1.

The complainant has not adduced any evidence to prove that

accused 2 acted even as a broker much less as an agent of accused

1 as regards the transaction. Irrefutably, even according to the

complainant the goods were delivered to accused 1.

The complainant has not proved that he did not receive the

consideration from accused 1 and accused 2 was therefore,

responsible as an agent to ensure that the disputed cheque is

honoured. No evidence is produced to show that accused 2 had

any business relationship with the complainant, as a broker or an

agent or otherwise.

12] The accused 2, who is arrayed through Shri Ashok

Thanvi contends that the statutory notice is not only defective, the

service thereof on accused 2 is not proved. The statutory notice is

addressed to Shree Durga Trading Company through

proprietor/partner Shri Ashok Thanvi. The envelope containing

the said notice is received back unserved with the endorsement

"not available responsible person". The submission of the learned

counsel for the accused is that since Ashok Thanvi was neither the

proprietor nor the partner of Shri Durga Trading Company and it

was his father Shri Gokulchand Thanvi (D.W.1) who was the sole

proprietor of the said concern, the statutory notice which is

addressed to Ashok Thanvi as proprietor or partner of M/s. Shree

Durga Trading Company must be held as defective. At any rate, no

presumption of service can be drawn in view of the incorrect

description of the addressee. The submission of the learned

counsel does have some substance. However, since the existence of

liability or debt is not proved, I need not delve on the said

submission in any detail.

13] D.W.1 Shri Gokulchand Thanvi has stepped into the

witness box. He proves that he is the sole proprietor of M/s. Shri

Durga Trading Company. He asserts that he did not have any

business relationship with the complainant or accused 1. He did

not have even an acquaintance with the complainant or accused 1,

is the assertion. D.W.1 states that his son intended to issue the

disputed cheque in favour of one Shakambari Traders as security

for a purchase order placed. The sesame was not supplied by

Shakambari Traders, and stop payment instructions were issued.

D.W.1 has explained the circumstances in which, at the instance of

Shakambari Traders, the cheque came to be issued in the name of

the complainant. The evidence of D.W.1 needs appreciation in the

backdrop of the evidence of the complainant that even earlier

payment credited in the account of accused 1 was received by the

complainant through-from Shakambari Traders, the proprietor or

partner of which concern is a relative. The defence that it was

Shakambari Traders who asked the son of D.W.1 to issue the

cheque in the name of the complainant is quite probable.

Even otherwise, since it is quite apparent from the complaint and

the evidence of C.W.1 that accused 2 cannot be saddled with the

liability against which the cheqe is purportedly issued, the

statutory presumption under section 139 of the Act is clinchingly

rebutted.

14] In Rangappa vs. Sri Mohan reported in (2010) 11 SCC

441, the Hon'ble Apex Court, while holding that since the

signature on the cheque is not disputed, the statutory presumption

under Section 139 of the Act is activated, which the accused could

not rebut since the defence of lost cheque was not probable,

observed thus:

"27. 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 causes and the defendant-accused cannot be expected to discharge an unduly high standard or proof.

28. 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."

15] In T. Vasanthakumar vs. Vijayakumari reported in

(2015) 8 SCC 378, the Hon'ble Apex Court, relying on the three

Judges Bench judgment in Rangappa vs. Sri Mohan, on facts, holds

that the statutory presumption is not rebutted by the accused.

15] In K.N. Beena vs. Muniyappan and another reported in

(2001) 8 SCC 458, the Hon'ble Apex Court, refers to Hiten P. Dalal

v. Bratindranath Banerjee and holds, on the factual matrix, that

bare denial of the liability in reply notice is not sufficient to shift

the burden of proof on the complainant to prove that the cheque

was issued for a debt or liability.

16] The Three Judges Bench judgment of the Hon'ble

Apex Court in Hiten P. Dalal v. Bratindranath Banerjee reported in

(2001) 6 SCC 16 considers the scope and ambit of Section 139 of

the Act thus:

"22. Because both Sections 138 and 139 require that the court "shall presume" the liability of the drawer of the cheques for the amounts for which the cheques are drawn, as noted in State of Madras vs. A. Vaidyanatha Iyer, it is obligatory on the Court to raise this presumption in every case where the factual basis for the raising of the presumption had been established. "It introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused" (Ibid. at p.65, para 14). Such a presumption is a presumption of law, as distinguished from a presumption of fact which describes provisions by which the court "may presume" a certain state of affairs. Presumptions are rules of evidence and do not conflict with the presumption of innocence, because by the latter all that is meant is that the prosecution is obliged 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

or fact unless the accused adduces evidence showing the reasonable possibility of the non-existence of the presumed fact.

23. In other words, provided the facts required to form the basis of a presumption of law exists, no discretion is left with the court but to draw the statutory conclusion, but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary. A fact is said to be proved when, "after considering the matters before it, the court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists".

Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the court in support of the defence that the Court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the 'prudent man'.

24. Judicial statements have differed as to the quantum of rebutting evidence required. In Kundan Lal Rallaram v. Custodian, Evacuee Property, this Court held that the presumption of law under Section 118 of Negotiable Instruments Act could be rebutted, in certain circumstances, by a presumption of fact raised under Section 114 of the Evidence Act. The decision must be limited to the facts of that case. The more authoritative view has been laid down in the subsequent decision of the Constitution Bench in Dhanvantrai Balwantrai Desai vs State of Maharashtra AIR where this Court reiterated the principle enunciated in State of Madras vs Vaidyanath Iyer and clarified that the distinction between the two kinds of presumption lay not only in the mandate to the Court, but also in the nature of evidence required to rebut the two. In the case of a discretionary presumption the presumption if drawn

may be rebutted by an explanation which "might reasonably be true and which is consistent with the innocence" of the accused. On the other hand in the case of a mandatory presumption "the burden resting on the accused person in such a case would not be as light as it is where a presumption is raised under Section 114 of the Evidence Act and cannot be held to be discharged merely by reason of the fact that the explanation offered by the accused is reasonable and probable. It must further be shown that the explanation is a true one. The words 'unless the contrary is proved' which occur in this provision make it clear that the presumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible. A fact is said to be proved when its existence is directly established or when upon the material before it the Court finds its existence to be so probable that a reasonable man would act on the supposition that it exists. Unless, therefore, the explanation is supported by proof, the presumption created by the provision cannot be said to be rebutted. (AIR p.580, para 12)"

[See also V.D. Jhingan vs. State of Uttar Pradesh; Sailendranath Bose vs. The State of Bihar and Ram Krishna Bedu Rane vs. State of Maharashtra.]"

17] The nature of the initial burden of proof on the

accused to rebut the statutory presumption under Section 139 is

explained by the Hon'ble Apex Court in M.S. Narayana Menon

Alias Mani v. State of Kerala and another reported in (2006) 6 SCC

39 thus:

"29. In terms of Section 4 of the Evidence Act whenever it is provided by the Act that the Court shall presume a fact, it shall regard such fact as proved unless and until it is disproved. The words 'proved' and 'disproved' have been defined in Section 3 of the Evidence Act (the interpretation clause) to mean:

" 'Proved' - A fact is said to be proved when, after considering the matters before it, the court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists.

'Disproved' - A fact is said to be disproved when, after considering the matters before it the Court either believes that it does not exist, or considers its non-existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it does not exist."

30. Applying the said definitions of 'proved' or 'disproved' to 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.

31. A Division Bench of this Court in Bharat Barrel & Drum Manufacturing Company v. Amin Chand Payrelal albeit in a civil case laid down the law in the following terms:

"12. Upon consideration of various judgments as noted hereinabove, the position of law which emerges is

that once execution of the promissory note is admitted, the presumption under Section 118(a) would arise that it is supported by a consideration. Such a presumption is rebuttable. The defendant can prove the non-existence of a consideration by raising a probable defence. If the defendant is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the plaintiff who will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to the grant of relief on the basis of the negotiable instrument. The burden upon the defendant of proving the non-existence of the consideration can be either direct or by bringing on record the preponderance of probabilities by reference to the circumstances upon which he relies. In such an event, the plaintiff is entitled under law to rely upon all the evidence led in the case including that of the plaintiff as well. In case, where the defendant fails to discharge the initial onus of proof by showing the non-existence of the consideration, the plaintiff would invariably be held entitled to the benefit of presumption arising under Section 118(a) in his favour. The court may not insist upon the defendant to disprove the existence of consideration by leading direct evidence as the existence of negative evidence is neither possible nor contemplated and even if led, is to be seen with a doubt. 5"

This Court, therefore, clearly opined that it is not necessary for the defendant to disprove the existence of consideration by way of direct evidence.

32. The standard of proof evidently is preponderance of probabilities. Inference of preponderance of probabilities can be drawn not only from the materials on records but also by reference to the circumstances upon which he relies.

38. If for the purpose of a civil litigation, the defendant may not adduce any evidence to discharge

the initial burden placed on him, a 'fortiori' 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.

45. Two adverse inferences in the instant case are liable to be drawn against the Second Respondent:

(i) He deliberately has not produced his books of accounts.

(ii) He had not been maintaining the statutory books of accounts and other registers in terms of the bye-laws of Cochin Stock Exchange.

Moreover, the onus on an accused is not as heavy as that of the prosecution. It may be compared with a defendant in a civil proceeding."

18] If the evidence on record is tested on the anvil of the

enunciation of law by the Apex Court, I have no hesitation in

holding that the statutory presumption under section 139 of the

Act is rebutted by the accused.

19] The view taken is a possible view and the judgment

and order impugned is neither perverse nor is vitiated by any

serious error nor does the judgment occasion a miscarriage of

justice. No compelling case is made out warranting this court's

interference in the judgment of acquittal.

20] The appeal is sans merit and is rejected.

JUDGE

NSN