Rajasthan High Court - Jodhpur

Jaipur Thar Gramin Bank vs State on 29 October, 2021

Bench: Manoj Kumar Garg

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR S.B. Crml Leave To Appeal No. 33/2020

Jaipur Thar Gramin Bank, Branch Jaisalmer Through Its Branch Manager, M.k. Suthar, Aged 59 Years, R.m.g.b., Branch Jaisalmer, District Jaisalmer (Rajasthan).

----Appellant Versus

1. State, Through P.p.

2. Chhagna Ram S/o Shri Govind Ram, By Caste Oad, R/o Govind Ram Ki Dhani, Tehsil And District Jaisalmer (Raj).

                                                                 ----Respondents


For Appellant(s)         :     Mr. Laxman Singh Bhati
For Respondent(s)        :



         HON'BLE MR. JUSTICE MANOJ KUMAR GARG

                                Judgment

Judgment Reserved on :                      23/10/2021
Date of pronouncement:                       29/10/2021

The appellant has filed the present criminal leave to appeal

being aggrieved by the judgment dt. 29.11.2019 passed by the

learned Judicial Magistrate, Jaisalmer in Criminal Regular Case No.

774/2013 (1188/14), whereby the learned Magistrate has

acquitted the respondent no.2 for offence under Sec. 138 of the

Negotiable Instruments Act ('the Act', for short).

Briefly, the facts of the case are that appellant filed a

complaint under Section 138 of the Act alleging that the

respondent No.2 had taken loan from the appellant in the sum of

Rs. 35,000/- and the appellant Bank sanctioned the said loan on

11.11.2005 and the respondent accused agreed to pay the

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instalments regularly and against the said loan the respondent

submitted a cheque of Rs. 44,000/- No. 723213 dated

16.02.2012. It is alleged that when the appellant presented the

cheque in the Bank, the same was dishonoured due to want of

sufficient funds. Subsequently, the complainant sent a registered

notice to the respondent. However, despite receiving the notice,

the respondent did not make the payment and settle the account,

therefore, he filed a complaint under Section 138 of N.I. Act.

The learned trial court after taking cognizance of the offence

issued notice to the respondent accused who appeared in the

Court, denied charges and claimed trial.

After going through the oral and documentary evidence, vide

judgment dt. 29.11.2019, the learned Magistrate acquitted the

accused-respondent. Hence, this criminal leave to appeal.

Learned counsel for the appellant, has vehemently

contended that the learned court has erred in acquitting the

respondent on the ground that the appellant has failed to bring

home the charge for offence under Section 138 of the Act. It is

further argued the respondent had not discharged the burden of

proving as to why the cheque was given by him to the appellant.

Therefore, according to the learned counsel, the impugned

judgment deserves to be interfered with. Learned counsel relied

upon decision of Hon'ble Supreme Court in the case of Reema

Aggarwal Vs. Anupal & Ors reported in (2004) AIR (SC) 1418,

K.N. Beena Vs. Muniyappal & anr reported in (2001) AIR (SCW)

4344, A.V. Murthy Vs. B.S. Nagabasavanna reported in (2002)

AIR (SC) 985, Hiten P.Dalal Vs. Bratindranath Banerjee reportedin

(2001) AIR (SC) 3897 and Kumar Exports Vs. Sharma Carpets

reported in (2009) AIR (SC) 1518.

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I have heard the learned counsel for the appellant and

perused the impugned judgment.

The learned counsel for the appellant has contended that a

sum of Rs. 35,000/- was taken as loan by the respondent,

however, the appellant failed to produce any relevant document

like Bank statement or loan sanction letter to prove that the

cheque was issued against the loan taken by the respondent.

A bare perusal of the impugned judgment clearly reveals

that the learned trial court has given the cogent reasoning for

acquitting the accused-respondent. It has been concluded by the

learned court below that the appellant has failed to prove that the

cheque in question was issued by the respondent against the loan

sanctioned to him and therefore, if the cheque was dishonoured

for want of sufficient funds, the same does not constitute an

offence under Section 138 of the Act. Learned court further

observed that the appellant Bank failed to produce any

documentary proof to fortify the fact that loan was disbursed to

the respondent no.2. Except a bald statement in the complaint

that the disputed cheque was issued towards payment of loan

amount, there is no document produced on record with regard to

sanction of loan, disbursement of loan, bank statement and what

amount is unpaid. In my considered view, it would be hazardous

to convict the respondent only on the basis of the presumption

under section 139 of the Act in the absence of any material, and

which material ordinarily would be expected to be in the

complainant's possession and control, to show that loan was in

fact disbursed to the accused.

The standard of the proof that is required to probabilise the

suggestive case of the accused in a case filed under Section 138 of

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Negotiable Instruments Act is that the presumption under Section

139 of Negotiable Instruments is as that of statutory presumption,

however, the same is rebuttable. The standard of proof that

required to shift the burden on the shoulders of the accused is

based on the principles of "preponderance of probability" and not

on the principle as being examined in the criminal case to prove

the guilt of the accused "beyond reasonable doubt".

It is well settled that the proceedings under Section 138 of

Negotiable Instruments Act are quasi-criminal in nature. The

principles that will apply to acquittal in other criminal cases are

not applicable in cases instituted under the Act. The test of

proportionality should guide the construction and interpretation of

"reverse onus clauses" and the respondent/accused cannot be

expected to discharge an unduly high standard of proof. Since the

proceedings under Section 138 of the Negotiable Instruments Act

are quasi-criminal in nature, it is sufficient enough for the accused

to prove the "suggestive case or defence theory" up to the "level

of preponderance of probability".

Hon'ble Apex Court in the case of Kumar Exports vs. Sharma

Carpets reported in AIR 2009 SC 1518 has held as under :-

"11. The use of the phrase "until the contrary is proved" in Section 118 of the Act and use of the words "unless the contrary is proved" in Section 139 of the Act read with definitions of "may presume" and "shall presume" as given in Section 4 of the Evidence Act, makes it at once clear that presumptions to be raised under both the provisions are rebuttable. When a presumption is rebuttable, it only points out that the

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party on whom lies the duty of going forward with evidence, on the fact presumed and when that party has produced evidence fairly and reasonably tending to show that the real fact is not as presumed, the purpose of the presumption is over.

The accused in a trial under Section 138 of the Act has two options. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the non-existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed. To rebut the statutory presumptions an accused is not expected to prove his defence beyond reasonable doubt as is expected of the complainant in a criminal trial.

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 debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that bare denial of the passing of the consideration and existence of debt, 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 presumptions, 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

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under the circumstances of the case, act upon the plea that 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 to the complainant. The accused may also rely upon presumptions of fact, for instance, those mentioned in Section 114 of the Evidence Act to rebut the presumptions arising under Sections 118 and 139 of the Act.

The accused has also an option to prove the non- existence of consideration and debt or liability either by letting in evidence or in some clear and exceptional cases, from the case set out by the complainant, that is, the averments in the complaint, the case set out in the statutory notice and evidence adduced by the complainant during the trial. Once such rebuttal evidence is adduced and accepted by the court, having regard to all the circumstances of the case and the preponderance of probabilities, the evidential burden shifts back to the complainant and, thereafter, the presumptions under Sections 118 and 139 of the Act will not again come to the complainant's rescue."

Thus, it is the consistent view of the Hon'ble Supreme Court

and this Court that it is mandatory to invoke the statutory

presumption in such cases. However, while the presumption is

indeed triggered, the presumption is rebuttable. The burden on

the accused is to make out a probable defence. The accused need

not step into the witness box or adduce direct evidence. It would

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suffice if the accused is in a position to create a reasonable doubt

that the version of the complainant is false. In the factual matrix,

the accused has more than succeeded in rebutting the

presumption.

Since cogent reasons have been given by the learned