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Shakuntala Devappa v. B.R. Ravishankar
Factual and Procedural Background
The petitioner, referred to as the accused, challenged concurrent findings of the lower courts that he committed an offence under section 138 of the Negotiable Instruments Act, 1881. The trial court accepted the complainant's evidence that the accused borrowed Rs. 50,000 and issued two dishonoured cheques of Rs. 20,000 and Rs. 30,000 to discharge this debt. The accused contended that the cheques were stolen by the complainant and misused to file the complaint, a defence rejected by the trial court and confirmed by the first appellate court. The accused also alleged alternative theories about the theft of the cheques during evidence, which were found irreconcilable by the court. The accused did not dispute that the cheques were drawn on her account but claimed they were incomplete and partially filled out for her husband to complete for repayment of a housing loan. The accused had initiated a complaint against the complainant for theft, which resulted in a police 'B' report, but did not pursue it further.
Legal Issues Presented
- Whether the courts below erred in convicting the accused under section 138 of the Negotiable Instruments Act, 1881.
- Whether the accused successfully rebutted the presumption under section 139 of the Act regarding the issuance of cheques for discharge of a legally recoverable debt.
- Whether the fine imposed by the trial court was excessive and required reduction.
Arguments of the Parties
Accused's Arguments
- The accused denied borrowing money from the complainant, who was a stranger.
- The cheques were incomplete and partially filled out by the accused for her husband to complete.
- The cheques were stolen by the complainant or alternatively by a hostile colleague who handed them to the complainant.
- The accused lodged a complaint against the complainant for theft of cheques, which was not pursued after a police 'B' report.
- Discrepancies existed in the complainant’s evidence regarding the place and date of lending money and issuance of cheques.
- The fine imposed by the trial court was exorbitant.
Complainant's Arguments
- The complainant’s evidence was accepted by the trial court and appellate court as proving the accused borrowed money and issued cheques to discharge the debt.
- The accused deliberately delayed proceedings and benefited by retaining the amount payable.
- Reduction of fine was not warranted due to accused’s conduct.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Bharat Barrel & Drum Manufacturing Company v. Amin Chand Pyarelal, (1999) 3 SCC 35 | Principles relating to the presumption under section 139 of the Negotiable Instruments Act | Referenced to affirm the settled legal principles regarding presumption of consideration and burden of proof |
| Balaji Seafoods Exports (India) Ltd. v. Mac Industries Ltd., I (1999) BC 298 | Legal standards on dishonoured cheque offences | Used to support the court's view on the evidentiary standards |
| K.N Beena v. Muniyappan, (2001) 8 SCC 458 | Rebuttal of presumption under section 139 of the Act | Reiterated the burden on accused to rebut presumption of debt and cheque issuance |
| Sam Daniel v. John, [2005] 128 Comp. Cas. 17 (Mad) | Application of section 138 in cheque dishonour cases | Supported the court’s approach to evidence appreciation |
| Krishna Janardhan Bhat v. Dattatraya G. Hegde, 2008 (5) KCCR 2988 | Presumption of legally recoverable debt under section 139 | Confirmed the presumption and burden of proof principles |
| Narayana Menon Alias Mani v. State of Kerala, (2006) 6 SCC 39 | Proof of legally recoverable debt and issuance of cheque | Reinforced the evidentiary framework for section 138 cases |
| Shreyas Agro Services Pvt. Ltd. v. Chandrakumar S.B, 2006 Crl.L.J 3140 | Application of section 138 offences | Referenced in support of the court’s legal reasoning |
| Uppinangady Grama Panchayat, Puttur, Dakshina Kannada v. P. Narayana Prabhu, 2006 Crl.L.J 3141 | Legal standards in cheque dishonour cases | Used to corroborate principles applied |
| S A Sabastian v. G Thipperangaiah, 2012 (4) KCCR 3569 | Presumption under Negotiable Instruments Act | Supported the presumption of consideration and debt |
| Binod Kumar Lall v. State of Jharkhand, 2009 (1) Crimes 201 (Jhar.) | Burden of proof in cheque dishonour cases | Reinforced evidentiary burden on accused |
| Mr. P.S Aithala v. Mr. Ganapathy N. Hegde, 2009 (1) Crimes 202 (Kar.) | Application of section 138 and evidentiary standards | Referenced to uphold conviction principles |
| Nandkishore Mehra v. Sudha Transport Ltd., 2009 (1) Crimes 203 (Bom.) | Legal framework for cheque dishonour offences | Supported the court’s conclusions |
| Veerayya v. G.K Madivalar, 2012 (3) KCCR 2057 | Presumption and burden of proof under section 138 | Reaffirmed the principles applied by the court |
| Jitendra Sing Flora v. Ravikant Talwar, II (2001) BC 699 | Presumption of debt and cheque issuance | Referenced in legal analysis |
| Bhageerathy v. V. Beena, 1992 (3) Crimes 663 | Evidence required to rebut presumption under section 139 | Supported court’s reasoning on burden of proof |
| Anirudhan v. Philip Jacob & Others, 2006 Crl.L.J 3866 | Application of section 138 and evidentiary requirements | Used to confirm court’s approach |
Court's Reasoning and Analysis
The court noted that under section 401 Cr.P.C., revisional jurisdiction does not permit it to act as a court of second appeal but allows interference only in cases of glaring errors or manifest injustice. The trial court’s acceptance of the complainant’s evidence and rejection of the accused’s defence was affirmed by the first appellate court. The accused did not dispute that the dishonoured cheques were drawn on her account but claimed the cheques were incomplete and stolen. The accused’s varying and irreconcilable versions about the theft of the cheques weakened her defence.
Section 118 of the Negotiable Instruments Act creates a presumption that the holder of a cheque holds it for consideration. Section 139 creates a presumption that the cheque was issued for discharge of a legally recoverable debt. The accused failed to satisfactorily explain how the cheques reached the complainant and did not successfully rebut the statutory presumption under section 139. The courts below correctly found that the complainant proved the existence of a legally recoverable debt and that the accused issued the cheques to discharge it.
Regarding the fine, while the accused argued it was exorbitant, the court found that the accused had deliberately protracted the proceedings and benefited by retaining the amount payable. However, considering the facts and submissions, the fine was reduced from Rs. 1,00,000 to Rs. 90,000.
Holding and Implications
The court’s final decision is as follows:
The revision petition is accepted in part. The conviction of the petitioner-accused under section 138 of the Negotiable Instruments Act is confirmed. However, the payment of fine imposed by the trial court is reduced from Rs. 1,00,000 to Rs. 90,000. The rest of the impugned judgment is also confirmed.
This decision directly affects the parties by upholding the conviction and slightly reducing the fine. No new precedent or broader legal principle was established beyond reaffirming settled law regarding the presumption of debt and burden of proof under the Negotiable Instruments Act.
ORDER
The petitioner (hereinafter referred as ‘accused’) is before this court against the concurrent findings of courts below that he has committed an offence punishable under section 138 of the Negotiable Instruments Act, 1881 (for short, ‘the Act’).
2. The law is fairly well settled that this court while exercising revisional jurisdiction under section 401 Cr.P.C, does not sit as a court of second appeal. This court can interfere with the impugned judgment if the courts below have committed glaring errors in appreciation of evidence or errors of law resulting manifest injustice to petitioner.
3. I have heard Sri. B.A Raviraj, learned counsel for accused and Sri. G. Chandrashekaraiah, learned counsel for complainant.
4. The trial court accepting the evidence of complainant has held that accused had borrowed a sum of Rs. 50,000/- and she had issued two dishonoured cheques, one for a sum of Rs. 20,000/- and the other for a sum of Rs. 30,000/- to discharge aforestated liability. The trial court rejected the defence version that complainant had stolen cheques from the house of accused and misused the same to initiate the instant complaint. The learned Judge of I-appellate court on re-appreciation of evidence has confirmed the aforestated findings.
5. On hearing learned counsel for parties and after going through the impugned judgments with reference to evidence on record, I find that accused has not disputed that dishonoured cheques were drawn by her on the account held by her. On the other hand, accused has sought to establish that she had not filled in columns meant for name of payee and date of cheque. The accused had written the amount both in numericals and figures and signed cheques. The accused had left half-filled cheques to enable her husband to fill in the name of payee and date of cheques, to repay housing loan. These cheques were stolen by complainant to file the instant complaint. The accused had also initiated a complaint against complainant for stealing cheques, which was referred to jurisdictional police. The jurisdictional police on investigation submitted ‘B’ report. Thereafter, accused did not pursue the matter for the reasons best known to her. These contentions have been dealt by courts below. The same contentions are reiterated before this court.
6. The accused has stated that complainant was a total stranger to her. There was no necessity for accused to borrow money from complainant. The accused has also contended that complainant is a coffee powder vendor, in that connection, he might have visited her house. In the next breath, accused has deposed that she had lodged a complaint against complainant after receipt of notice under section 138(c) of the Act. During evidence, accused has come out with a new theory that one of her colleague namely Sunandamma, who had become hostile towards her had stolen cheques from house of accused and had given the same to complainant to initiate the instant complaint.
7. It is interesting to notice that accused without knowing complainant and without knowing the whereabouts of complainant had lodged a complaint alleging that complainant had stolen cheques from her house. During evidence, accused had come out with altogether a different version, stating that her colleague namely Sunandamma had stolen cheques, which were partially filed by accused and said Sunandamma had given to complainant to initiate the instant complaint. The versions put forth by accused are irreconcilable.
8. The learned counsel for accused would submit that there has been discrepancy in the evidence adduced by complainant regarding place where money was lent to accused and also the date on which cheques were issued by accused.
9. Under section 118 of the Act, there is a presumption regarding holder of cheque. It is to be presumed that a person, who holds cheque holds the cheque for consideration unless contrary is proved.
10. The accused was working as a School Teecher. She has failed to explain the circumstances under which cheques partially drawn by her had reached the hands of complainant. It is true that initial burden of proof rests upon complainant to prove legally recoverable debt. It is true that court can raise presumption that cheque was issued to discharge legally recoverable debt and such presumption is rebuttable. The accused can rebut such presumption, depending upon evidence adduced by complainant or by adducing evidence.
In the case on hand, the courts below on appreciation of evidence adduced by complainant has held that complainant has proved existence of legally recoverable debt and cheques were issued to discharge legally recoverable debt.
11. The accused has put forth aforestated defence irrcooncilable versions and has failed to rebut presumption available under section 139 of the Act.
12. On reconsideration of the matter, I find that accused has failed to rebut presumption either by depending upon evidence adduced by complainant or on the basis of evidence adduced on behalf of accused. In the circumstances, courts below were justified in holding accused guilty of an offence punishable under section 138 of the Act.
13. The learned counsel for accused has relied on the following decisions:-
I. (1999) 3 SCC 35 (in the case of Bharat Barrel & Drum Manufacturing Company v. Amin Chand Pyarelal)
II. I (1999) BC 298 (in the case of Balaji Seafoods Exports (India) Ltd. v. Mac Industries Ltd.)
III. (2001) 8 SCC 458 (in the case of K.N Beena v. Muniyappan)
IV. [2005] 128 Comp. Cas. 17 (Mad) (in the case of Sam Daniel v. John)
V. 2008 (5) KCCR 2988 (in the case of Krishna Janardhan Bhat v. Dattatraya G. Hegde.. (2006) 6 SCC 39 (in the case of Narayana Menon Alias Mani v. State of Kerala)
VII. 2006 Crl.L.J 3140 (in the case of Shreyas Agro Services Pvt. Ltd. v. Chandrakumar S.B)
VIII. 2006 Crl.L.J 3141 (in the case of Uppinangady Grama Panchayat, Puttur, Dakshina Kannada v. P. Narayana Prabhu. 2012 (4) KCCR 3569 (in the case of S A Sabastian v. G Thipperangaiah. 2009 (1) Crimes 201 (Jhar.) (in the case of Binod Kumar Lall v. State of Jharkhand.)
XI. 2009 (1) Crimes 202 (Kar.) (in the case of Mr. P.S Aithala v. Mr. Ganapathy N. Hegde*. 2009 (1) Crimes 203 (Bom.) (in the case of Nandkishore Mehra v. Sudha Transport Ltd.)
XIII. 2012 (3) KCCR 2057 (in the case of Veerayya… v. G.K Madivalar….. II (2001) BC 699 (in the case of Jitendra Sing Flora…Applicant; v. Ravikant Talwar…Non-Applicant.. 1992 (3) Crimes 663 (in the case of Bhageerathy v. V. Beena. 2006 Crl.L.J 3866 (in the case of Anirudhan v. Philip Jacob & Others).
14. After going through the decisions cited above, I find the principles of law reiterated by me supra are not in any way divergent with the aforestated decisions.
15. The learned counsel for petitioner submits that fine imposed by trial court is exhorbitant and several efforts were made to settle the matter.
16. The learned counsel for complainant would submit that accused has deliberately protracted the proceedings before courts below and also before this court and has derived benefit by retaining the amount payable to complainant. Therefore, reduction of fine will not call for interference.
17. Having regard to the facts and circumstances of the case and also submissions made by learned counsel for parties, I deem it proper to reduce the fine from a sum of Rs. 1,00,000/- to Rs. 90,000/-.
18. In the result, I pass the following:-
ORDER
The revision petition is accepted in part. The conviction of petitioner-accused for an offence punishable under section 138 of the Act is confirmed, however, payment of fine is reduced from Rs. 1,00,000/- to Rs. 90,000/-. The rest of the impugned judgment is confirmed.
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