Gujarat High Court
Henil Kanubhai Patel vs State Of Gujarat on 31 January, 2025
NEUTRAL CITATION
R/CR.MA/24027/2024 ORDER DATED: 31/01/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL MISC. APPLICATION NO. 24027 of 2024
(FOR LEAVE TO APPEAL)
In
F/CRIMINAL APPEAL NO. 45337 of 2024
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HENIL KANUBHAI PATEL
Versus
STATE OF GUJARAT & ANR.
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Appearance:
DR. HIREN S SOMAIYA(8031) for the Applicant(s) No. 1
MS JIRGA JHAVERI, APP for the Respondent(s) No. 1
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CORAM:HONOURABLE MS. JUSTICE S.V. PINTO
Date : 31/01/2025
ORAL ORDER
1. The present application is filed by the applicant -
original complainant under Section 419(4) of the Bharatiya Nagrik
Suraksha Sanhita, 2023 (for short "BNSS") seeking leave to file an
appeal against the judgment and order dated 27.09.2024 passed by
the learned 2nd Additional Civil Judge, Anand in Criminal Case
No. 2497 of 2022, 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 Act").
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1.1 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 and the accused were friends and had
financial relationship between them and 3 to 4 years prior to filing
the complaint, as the mother of the accused was not well, the
accused demanded the amount of Rs.9,00,000/- from the
complainant. That the complainant had given the amount of
Rs.9,00,000/- in parts and when the amount was demanded back,
the accused gave cheque No.383079 dated 17.02.2022 of
Rs.9,00,000/- drawn on State Bank of India, Karamsad Branch. The
cheque was deposited by the complainant in his account, which
returned with the endorsement "funds insufficient" on 19.12.2022.
The applicant intimated the return of cheque to the accused, who
asked him to re-deposit the same, and once again, it was deposited
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on 12.04.2022 but, the cheque was returned unpaid with the
endorsement 'exceeds arrangement' on 14.04.2022 The applicant
gave the statutory demand notice, which was duly served to the
accused and the accused gave a wrong reply and did not repay the
amount within the statutory period, and hence, the complaint was
filed under Section 138 of the N.I.Act before the Court of learned
Chief Judicial Magistrate, Anand, which was registered as
Criminal Case No.2497 of 2022.
2.2 The accused was served with the summons and
appeared before the learned Trial Court and his plea was recorded
at Exhibit-08 and the evidence of the applicant was taken on
record. The applicant was examined on oath and 09 documentary
evidences were produced in support of his case and after the
closing pursis at exhibit 30 was filed, the further statement of the
accused under Section 313 of the Code of Criminal Procedure was
recorded, wherein the accused stated that according to the
agreement cheque No 383080 was given as security as per
agreement for Rs.4,50,000/- in which the complainant filled excess
amount, which is not a legally recoverable debt and the complaint
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is false and the cheque has been misused by illegally filling more
than what is due. The arguments of the advocates for both the
parties were heard and by impugned judgment and order, the
learned Trial Court acquitted the accused from the offence under
Section 138 of the 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 Mr. H. S. Somaiya appearing
for the applicant and learned APP Ms. Jirga Jhaveri for the
respondent - State.
5. Learned advocate Mr.H.S.Somaiya for the applicant
has submitted that the learned Trial Court has not considered that
the accused had accepted the debt, and even in the reply to the
statutory notice, had stated that he is ready and willing to settle
the accounts with the applicant but the dispute was of the amount.
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The parties had executed an agreement for repayment of
Rs.4,51,000/- and the reasons recorded by the learned Trial Court
are erroneous and not sustainable in the law. The applicant has a
good case on merits and the impugned judgment and order of
acquittal is illegal and unsustainable in the eye of law, and hence,
the present application for leave to appeal may be allowed.
6. Learned APP Ms.Jirga Jhaveri for the respondent -
State has submitted that the learned Trial Court has appreciated all
the evidence in true perspective and has not committed any error
in acquitting the accused. Therefore, no interference of this Court
is required in the impugned judgment and the order of acquittal
passed by the learned Trial Court and has urged this Court to
reject the present application.
7. With regard to the facts in the present case, it would be
fit to refer to the observations made the Apex Court in Rangappa
vs Sri Mohan reported in 2010 11 SCC 441. The Apex Court has
observed in 14, as under.
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"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 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
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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."
7.1 The Apex Court in Tedhi Singh vs Narayan Dass
Mahant reported in 2022 6 SCC 735 has observed as under in Para
7 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.
"
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7.2 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 and held that
"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:
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.
2. 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.
3. 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.
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.
5. It is not necessary for the Accused to come in
the witness box to support his defence.
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
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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
considering the arguments advanced by the learned advocates for
the parties and on perusal of the record of the case, it is the case of
the applicant that an amount of Rs.9,00,000/- was taken by the
accused on loan and the agreement at exh. 25 was executed
between the parties. After the statutory demand notice was served
to the accused, the accused sent a reply to the notice mainly stating
that an amount of Rs.4,00,000/- was taken and the accused is
ready and willing to pay the amount of Rs.4,00,000/- but falsely
the amount of Rs.4,51,000/- was was added in the amount.
Moreover, the cheque shows the amount of Rs.9,00,000/- and the
accused has stated that the complainant had threatened that he
would have to pay an amount of Rs.9,00,000/-. The agreement has
been produced by the applicant and the amount of Rs.4,51,000/- is
written by hand. The cheque in question is of Rs.9,00,000/- and
there is no explanation about the difference in the amount of
Rs.4,51,000/- and Rs.9,00,000/- by the applicant. During the cross
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examination, the applicant has stated that in the complaint, notice
and examination in chief, he has not shown any other source of
income besides his salary income and the amount was given to the
accused in parts in the years 2013-2014, but he does not remember
exactly in which month, and in which year the amount was given.
That he has not mentioned in the complaint, notice, and
examination in chief, when did he last give the amount to the
accused and exactly in how many parts was the amount given.
The applicant has stated that he does not file income tax returns,
and the amount mentioned in the agreement is Rs.4,51,000/-.
9. In light of the judgment of Rangappa (Supra) the accused
is not expected to discharge an unduly high standard of proof and the
accused has to rebut the presumption under Section 139 of the N.I.Act
and the standard for doing so is that of "preponderance of
probabilities". In the instant case, the accused has successfully rebutted
the presumption and has raised a probable defence and during the
cross-examination of the complainant has questioned his financial
capacity and has also brought on record that the complainant did not
have the sufficient income to extend a loan of Rs.9,00,000/- to the
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accused. As settled by the Apex Court in Basalingappa (Supra) it is not
necessary for the accused to step into the witness box to raise his
defence, and his probable defence can be drawn out from the materials
of the complainant and there is a huge difference in the amount of Rs
4,51,000/- mentioned in the agreement and Rs 9,00,000/- mentioned in
the cheque which has not been explained by the applicant.
10. The learned Trial Court has concluded that the
presumption has been successfully rebutted by the accused and as
there was a huge difference in the amount mentioned in the
agreement as also the amount mentioned in the cheque which has
not been explained by the applicant, the legally recoverable debt is
not proved by the applicant and as the legally recoverable debt
was not proved, the impugned judgment and order was passed.
Moreover, the learned Trial Court has considered all the
documents produced by the complainant and has also considered
that the complainant has failed to prove beyond reasonable doubt
that the cheque in question was given as repayment of a legal debt.
The complainant's conduct which has been inconsistent, changing
versions and not aligning with the original complaint has also
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been considered by the learned Trial Court.
11. The learned Trial Court has relied upon the law laid
down by the Apex Court in the case of Jugesh Sehgal vs
Shamsher Singh Gogi passed in Criminal Appeal No. 1180 of 2009
wherein, it is held that all the elements of Section 138 of the N.I.Act
must be satisfied and the complainant has to prove the existence of
a legally recoverable debt, failing which it does not lead to
conviction of the accused and the accused has succeeded in
rebutting the presumption by preponderance of probability. As
per the judgment of the Apex Court in Basalingappa (Supra) the
complainant has to prove his financial capacity, failing which the
presumption under Section 139 of the N.I.Act deems rebutted and
the accused cannot be convicted. The learned Trial Court has
concluded that the complainant has failed to provide documentary
evidence of the debt and due to inconsistencies in the
complainant's version, the Trial Court found the evidence
unreliable and has concluded that the debt wasn't legally
enforceable, an essential requirement in such cases. The
complainant has not proved the debt beyond reasonable doubt,
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and as there was no legally enforceable debt, the learned Trial
court has passed the impugned judgment and order of acquittal,
which is just and proper and does not require any interference of
this Court.
12. Consequently, the present application seeking leave to
present an appeal under section 419(4) of the Bharatiya Nagrik
Suraksha Sanhita fails and is hereby dismissed.
13. Notice stands discharged. Record and proceedings if
any, be sent back to the learned Trial Court forthwith.
14. 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....
