Gujarat High Court
Palanpur Nagarpalika Thro Chief ... vs State Of Gujarat on 4 December, 2023
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL APPEAL (AGAINST ACQUITTAL) NO. 2274 of 2023
FOR APPROVAL AND SIGNATURE:
HONOURABLE MRS. JUSTICE M. K. THAKKER
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1 Whether Reporters of Local Papers may be allowed NO
to see the judgment ?
2 To be referred to the Reporter or not ? NO
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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PALANPUR NAGARPALIKA THRO CHIEF OFFICER INCHARGE THRO
PANCHABHAI VALABHAI MALI
Versus
STATE OF GUJARAT
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Appearance:
MR ABHIJIT RATHOD, ADVOCATE FOR MR MEHUL H RATHOD(701) for
the Appellant(s) No. 1
for the Opponent(s)/Respondent(s) No. 2
MS VRUNDA C SHAH, APP PUBLIC PROSECUTOR for the
Opponent(s)/Respondent(s) No. 1
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CORAM:HONOURABLE MRS. JUSTICE M. K. THAKKER
Date : 04/12/2023
ORAL JUDGMENT
1. This is an appeal filed under Section-378 of the Code of
Criminal Procedure, 1973 challenging the judgment and order
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dated 22.02.2023 passed by the 4 th Additional Chief Judicial
Magistrate, Palanpur at Banaskantha in Criminal Case
No.1658 of 2022, whereby, the respondent - accused was
acquitted for the offence punishable under Section-138 of the
N.I. Act.
2. It is the case of the complainant that the complainant,
who is the Officer, serving at Nagarpalika at Palanpur filed a
private complaint before the competent court against the
respondent - accused alleging that the respondent - accused
was having one shop bearing Shop No.1/3013 at Hanuman
Tekri, Palanpur and doing the business of repairing of
vehicles. The Nagarpalika had issued the various bill from
time to time in the name of father of the respondent - accused
viz.Chimanlal from 2013 onward. The said bills were remain
unpaid and therefore, on calculating 10% interest, the last
demand bill was issued on 17.09.2019 claiming the amount of
Rs.2,02,630/- and for the current year's, the another demand
bill of Rs.28,453/-, aggregating total bill for an amount of
Rs.2,31,083/- was issued to the respondent - accused, which
was accepted by making the signature. It is the further case of
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the complainant that for making data entry, the work was
given to the private agency and therefore, by mistake, the last
bill was for an amount of Rs.23,540/- was issued for the year
2020-21. The respondent - accused has given a cheque for an
amount of Rs.2,31,083/-, dated 20.03.2020. There
subsequently, a request was made to pay the amount in
installment to the President of the Nagarpalika on the ground
that his financial condition is not sound and therefore, the
cheque was taken back and a new cheque bearing No.52500
for an amount of Rs.25,000/- of Dena Bank, dated 22.03.2020
was issued and an assurance was given for payment of
remaining amount by way of installment. After deducting the
amount of Rs.25,000/- from the total amount of Rs.2,31,083/-,
the remaining amount of Rs.2,06,083/- was remain unpaid and
for that, he undertakes to pay before the month of March. On
calculating the interest on the aforesaid amount of
Rs.2,06,083/- from 2019-20 and 2020-21, the amount comes
to Rs.2,29,804/- in the month of March, 2021. Again, on
calculating 10% interest on the aforesaid amount, the amount
comes to Rs.2,61,072/-. The respondent - accused had paid an
amount of Rs.23,540/- under the Aatma Nirbhar Yojana out of
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an amount of Rs.31,268/- and after deducting the aforesaid
amount, the remaining amount of Rs.2,37,540/- remain
unpaid. Again on calculating the interest, the amount comes
to Rs.2,77,513/-, for which, a cheque for the lump-sum
amount of Rs.2,90,000/- was given by the respondent -
accused drawn on 10.01.2022 bearing cheque No.000003 of
Bank of Baroda, Palanpur branch. On depositing the said
cheque with the bank, the same was returned with
endorsement "stop payment" on 15.01.2022. The complainant
had issued demand notice on 09.02.2022, which was replied
by the respondent - accused on 21.02.2022 denying the dues
of the Nagarpalika and thereafter, a private complaint came
to be filed being Criminal Case No.1658 of 2022.
3. Learned court below after recording the verification,
issued the process under Section-204 of Cr.P.C. and on
appearing the respondent, a plea was recorded, wherein, the
respondent - accused had pleaded innocent and claimed to be
tried. To prove the case, the complainant had examined
himself below Exh.5 and produced various documentary
evidences. On filing the closing pursis below Exh.36, a further
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statement was recorded of the respondent - accused under
Section-313 of the Cr.P.C., wherein, the respondent - accused
had stated that the father had already cleared all the dues and
the cheque, which was stated to have been issued against the
demand bills, was illegal and there is no any due, which is to
be payable by the respondent - accused to the Nagarpalika.
The respondent - accused had produced various documentary
evidences including 'No Due Certificate' issued by the
Nagarpalika below Exh.30 and the notice issued to the
complainant by the accused below Exh.35. Learned trial Court
after considering the evidence placed on record and
submission made by the learned advocates for the respective
parties, passed judgment and order of acquittal, which is
impugned before this Court.
4. Heard learned advocates appearing for the respective
parties.
5. Mr. Abhijit Rathod, learned advocate appearing on
behalf of Mr. Mehul Rathod, learned advocate for the
appellant submits that learned trial Court has passed the
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judgment and order of acquittal without considering the
material, which was placed by the complainant and without
considering the settled position of law that the respondent -
accused had failed to rebut the presumption, which was
available in favour of the complainant under Sections-118 and
139 of the N.I. Act. Learned advocate further submits that
proper remedy for challenging the bills is before the other
competent court, wherein, the Civil Suit is already filed,
however, no any interim relief was granted to the respondent
- accused. Learned advocate further submits that there was
no any explanation offered by the respondent - accused with
regard to the fact that the cheque, which was issued for an
amount of Rs.2,31,083/- was taken back on the request made
by the respondent - accused to the President of the
Nagarpalika and on the assurance given by the respondent -
accused for clearing the dues in installments. Learned
advocate further submits that the learned trial Court had
committed an error in recording the fact that the said cheque
was produced by the complainant, infact, learned advocate
has drawn the attention of this Court with regard to the list of
the documents, wherein, it transpired that the cheque, which
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was taken back and produced before the learned trial Court
below Exh.33, was produced by the respondent - accused.
Learned advocate further submits that infact the learned trial
Court had also committed an error on the facts that on
framing the issues, wherein, it is mentioned that the
respondent had taken the hand-loan and cheque was returned
with the endorsement of 'insufficient fund'. Learned advocate
for the appellant submits that appropriate forum challenging
the bill is before the learned Court under section-138 of the
Gujarat Municipalities Act, however, instead of doing the
same, the respondent - accused had disputed the bill. Learned
advocate on submitting the same, prays that as the
complainant had successfully discharged his initial burden to
prove the case, the judgment and order passed by the learned
trial court deserves to be quashed and set aside and it was
further prayed that the respondent - accused be punished
accordingly.
6. Considering the submissions made by the learned
advocate for the respective parties and before entering into
merits, some of the provisions, which is required to be looked
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into, are reproduced herein-below:-
118 Presumptions as to negotiable instruments. --Until
the contrary is proved, the following presumptions shall
be made:--
(a) of consideration --that every negotiable instrument
was made or drawn for consideration, and that every such
instrument, when it has been accepted, indorsed,
negotiated or transferred, was accepted, indorsed,
negotiated or transferred for consideration;
(b) as to date --that every negotiable instrument bearing
a date was made or drawn on such date;
(c) as to time of acceptance --that every accepted bill of
exchange was accepted within a reasonable time after its
date and before its maturity;
(d) as to time of transfer --that every transfer of a
negotiable instrument was made before its maturity;
(e) as to order of indorsements --that the indorsements
appearing upon a negotiable instrument were made in the
order in which they appear thereon;
(f) as to stamps --that a lost promissory note, bill of
exchange or cheque was duly stamped;
(g) that holder is a holder in due course --that the holder
of a negotiable instrument is a holder in due course:
Provided that, where the instrument has been obtained
from its lawful owner, or from any person in lawful
custody thereof, by means of an offence or fraud, or has
been obtained from the maker or acceptor thereof by
means of an offence or fraud, or for unlawful
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consideration, the burden of proving that the holder is a
holder in due course lies upon him.
138 Dishonour of cheque for insufficiency, etc., of funds in
the account. -- Where any cheque drawn by a person on
an account maintained by him with a banker for payment
of any amount of money to another person from out of
that account for the discharge, in whole or in part, of any
debt or other liability, is returned by the bank unpaid,
either because of the amount of money standing to the
credit of that account is insufficient to honour the cheque
or that it exceeds the amount arranged to be paid from
that account by an agreement made with that bank, such
person shall be deemed to have committed an offence and
shall, without prejudice to any other provisions of this Act,
be punished with imprisonment for 19[a term which may
be extended to two years], or with fine which may extend
to twice the amount of the cheque, or with both: Provided
that nothing contained in this section shall apply unless--
(a) the cheque has been presented to the bank within a
period of six months from the date on which it is drawn or
within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque,
as the case may be, makes a demand for the payment of
the said amount of money by giving a notice in writing, to
the drawer of the cheque, 20[within thirty days] of the
receipt of information by him from the bank regarding the
return of the cheque as unpaid; and
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(c) the drawer of such cheque fails to make the payment
of the said amount of money to the payee or, as the case
may be, to the holder in due course of the cheque, within
fifteen days of the receipt of the said notice.
Explanation.-- For the purposes of this section, "debt or
other liability" means a legally enforceable debt or other
liability.]
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.
7. This Court also considered the decision rendered by the
Hon'ble Apex Court in the case of Basalingappa Vs.
Mudibasappa reported in (2019) 5 SCC 418. The relevant
paragraphs are as under:-
"23. We having noticed the ratio laid down by this Court
in the above cases on Section 118(a) and 139, we now
summarise the principles enumerated by this Court in the
following manner:
23.1. 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.
23.2. The presumption under Section 139 is a rebuttable
presumption and the onus is on the accused to raise
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probable defence. The standard of proof for rebutting the
presumption is that of preponderance of probabilities.
23.3. To rebut the presumption, it is open for the accused
to rely on evidence led by him or the 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.
23.4. 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.
23.5. It is not necessary for the accused to come in the
witness box to support his defence."
24. In addition to the above, in Kishan Rao V.
Shankargouda, (2018) 8 SCC 165, quoting Sharma
Carpets [Kumar Exports v. Sharma Carpets,(2009) 2 SCC
513], the Hon'ble Apex Court had held at para 20 as
follows:
"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 that
by leading direct evidence because the existence of
negative evidence is entirely possible nor
contemplated. At the same time it is clear that bare
denial of the passing of the consideration and
existence of that, 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
presumption 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
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they did not exist. Apart from adducing direct
evidence to prove that the note in question was not
supported by consideration or that he had not
incurred any debt or liability, the accused may also
rely upon circumstantial evidence and if the
circumstances so relied upon are compelling, the
burden may likewise shift again on the complainant."
25. To paraphrase the above, once presumptions u/s 118
and 139 NI Act are raised in complainant's favour upon
admission by the accused of the issuance of the cheques
in question, it is therefore upon the accused to rebut them
by adducing evidence. If upon preponderance of
probabilities, the accused is able to do the same, onus
once again shifts back upon the complainant to prove its
case beyond reasonable doubt. If the accused is unable to
do so, the complainant is entitled for a decision in his
favour. It is pertinent to note however, that the accused
can rebut the presumptions raised against him by flagging
gaps in the complaint's version itself and he is not obliged
to separately led independent defence evidence always.
He can show such circumstances to exist, from the
material placed on record by the complainant himself,
that there exists a probably defence in his favour.
Considering this, the right of the accused to cross
examine the complaint is of paramount importance
because by doing so, he can cast a dent on the
complainant's narrative to probablise his own defence.
Such an opportunity to be provided to the accused is
therefore crucial and non-affording the same, may well
amount to denying the accused to exercise his right to
defend himself altogether. Such a lapse on part of the
complainant therefore, would in fact go against the grain
of constitutional jurisprudence that no person can be
condemned unheard, as essentially that is what happens if
the complainant does not subject himself to be cross
examined by the accused.
8. On considering the settled law, the following facts,
which emerges from the record.
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(i) During the cross-examination of the complainant
conducted by the respondent - accused below Exh.4, it comes
on the record that the demand bill was issued to the Panchal
Chimanlal Durlabhram for the year 2020-21.
(ii) The Nagarpalika had issued 'No Due Certificate' in the
year 2020-21, which was exhibited below Exh.30, wherein, it
is mentioned that all the dues upto 31.03.2021 has been paid
up and the same was signed by the Chief Officer, Palanpur
Nagarpalika.
(iii) It is admitted by the complainant that with regard to the
earlier dues, the cheque of Rs.2,31,083/- was given and that
amount was paid by the respondent - accused through cash
and therefore, the said cheque was returned back to the
complainant. However, in the next line, the complainant states
that the whole amount was not paid.
(iv) It is admitted by the complainant that the bill, which was
issued for the amount of Rs.2,77,513/-, wherein for the due
amount, it was erased and due amount was shown of
Rs.31,668/-, which was produced at Exh.31. It is further
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admitted by the complainant that the bill, which was of dated
08.07.2021 of Rs.2,77,513/- is illegal as the amount had
already been paid up by the respondent - accused.
(v) It is further admitted by the complainant that with
regard to the same bill, data entry was made in the computer
by the Nagarpalika. The complainant further admits that the
bill of Rs.2,77,513/- was already cleared and there is no any
entry showing that subsequent amount is still unpaid. The
complainant further admits that with regard to the said bill,
the respondent - accused had issued the notice, which was
exhibited at Exh.35.
(vi) The complainant further admits that the reply to the
demand notice of the complainant, the respondent - accused
had stated that the bill has already been cleared. It is further
admitted by the complainant that there was no any bill
produced to the court showing that the amount of
Rs.2,90,000/- is remain unpaid.
(vii) It is admitted by the complainant that Recovery Team
went to the garage of the respondent - accused and on
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threatening that the garage would be sealed and disputed
cheque was taken. It is further admitted by the complainant
that the accused had given the application on 07.10.2022 with
regard to the stop payment of the disputed cheque. It is
admitted by the respondent - accused that the notice, which
was produced at Exh.35, it is contended by the respondent -
accused that the staff members of the complainant
Nagarpalika went and threaten the respondent accused and
taken the cheque of Rs.2,90,000/-. It is further admitted that
from the year 2013-14, the notices were issued to the father of
the respondent - accused, however, no any notice was
produced during the course of trial before the trial Court.
9. Considering the cross-examination, it transpired that
respondent - accused has rebutted presumption successfully
and it also clear that all the amount, which was due and
payable, was already paid and on that 'No Due Certificate'
was issued at Exh-30 stating that all dues were cleared upto
31.03.2021. That it transpires from the notice below Exh.35
issued by the respondent - accused to complainant that the
cheque was taken on threats to seal garage. That notice was
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not replied by complainant though it is admitted by
complainant that the same was received.
10. In view of the above, the complainant failed to establish
the case after rebutting the presumption successfully by the
respondent - accused and therefore, there was no any error
committed by the learned trial Court in acquitting the
respondent - accused for the charges.
11. Therefore, the present appeal fails. The judgment and
order dated 22.02.2023 passed by the 4 th Additional Chief
Judicial Magistrate, Palanpur at Banaskanth in Criminal Case
No.1658 of 2022 acquitting the respondent - accused is
hereby confirmed. Record and proceeding be sent back to the
concerned Court forthwith.
(M. K. THAKKER,J)
A. B. VAGHELA
