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").
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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
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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
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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
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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:
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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
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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.
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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
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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
