(1) Aggrieved by the orders of the xi metropolitan magistrate, secunderabad in c. C. No. 155 of 1995 wherein the accused was acquitted of the charge under section 138 of the negotiable instruments act by holding that the complainant failed to prove that there is any legally enforceable liability on the part of the respondent or he obtained any debt to that extent.
(2) It is not in dispute that the complainant who was examined as p. W. 1 was working as a foreman in the chit fund business run by accused. He says that he is a distant relative of the accused. He filed a complaint under section 138 of the negotiable instruments act by stating that the cheque dated 17 - 09 - 1994 for a sum of rs. 1,00,000/ - issued by the respondent was returned by the bank with an endorsement "refused" on 28 - 01 - 1995. Hence, he filed the present complaint to punish the accused as per law.
(3) In the witness box, he improved his version by stating that the amount was advanced by him for the house construction by the accused. In the cross - examination he - stated that he was working on a monthly salary of rs. 1,250/ - in the respondent chit fund company and he failed to prove that he is having any other means to lend such a huge amount rs. 1,00,000/ -. While admitting that he is an income tax assessee he stated that this amount was not shown in the income tax returns. For all these reasons the trial court disbelieved the evidence of the p. W. 1 and held that there is no legally enforceable liability by i the accused to the petitioner herein and accordingly, the complaint was dismissed.
(4) I do not find any illegality or irregularity in the order passed by the magistrate and the order of the trial court is confirmed.
(5) Accordingly, criminal appeal is dismissed.
(6) After pronouncing the orders in this case, the counsel for the appellant along with mr. C. Kpdandaram and mr. G. S. Dwarakeshwara rao, counsel appearing in criminal appeals no. 536/96 and 103/96 respectively, wherein the facts are almost identical, made a representation to give them an opportunity to argue the matter as these appeals involve an important question of law i. E. , under section 139 of the negotiable instruments act a presumption has to be drawn in favour of the holder of the cheque and burden lies upon the person who has drawn the cheque on his banker that the cheque was not issued in discharge of whole or in part of any debt of other liability and the courts below erred in dismissing the complaints as the accused failed to rebut the presumption available in favour of the holder of the cheque by any cogent evidence. In those circumstances, i heard all the counsel at length and hold that there is no substance in the argument advanced by these counsel.
(7) This court considered the validity of the sections 138 to 142 introduced by way of amendment by act 66 of 1988 in b. Mohana krishna and others vs. Union of india and others and held that they are not ultra vires of the powers of the union parliament. While considering point no. (v) that arose for consideration whether the presumption in section 139 in favour of the 'holder of the cheque' is violative of the fundamental right guaranteed under clause (3) of article 20 of the constitution of india held in para 41 of the judgment that the presumption incorporated in section 139 is not intended to cover all kinds of holders; it covers only the holder of a cheque of the nature referred to in section 138 i. E. , only in respect of a cheque which was issued in discharge, in whole or in part, of a debt or other liability, the presumption operates in favour of the payee as well as in favour of a holder in due course as defined in section 9 of the act.
(8) In para 54 of the judgment, their lordships observed that the drawer of the cheque can always take the plea that the amount covered by the cheque was not for the discharge of any legally enforceable debt or liability. The initial burden is on the complainant to show that the cheque was issued for the discharge of a legally enforceable debt or other liability. Then the burden shifts to the respondent to establish that the cheque issued was not of the nature referred to in section 138. In doing so, he may also rely upon the circumstantial evidence.
(9) From this, it is evident that when once the respondent takes the plea that the cheque was not issued for discharge of a legally enforceable debt or liability then the complainant is bound to prove the circumstances under which the cheque was given in his favour and that the same is issued in discharge of legally enforceable debt. Unless this initial burden is discharged by the complainant, the presumption available under section 139 cannot be made use of against the respondent. The proceedings being criminal in nature the accused is not expected through his defence by examining the witnesses and placing the evidence at his command. The case of the prosecution has to stand or fall on the evidence let in by it. The accused person is given liberty to cross - examine the witnesses examined in support of the prosecution case, to dislodge the version of the prosecution or to prove that the prosecution's version is not true. The court is entitled to record the findings after taking into consideration the totality of the circumstances and evidence let in on behalf of the complainant that the cheque was not given to the holder in discharge of a legally enforceable debt. When once such a finding is recorded by the court, on the basis of the evidence let in by the prosecution, the question of the accused person letting in evidence in support of his defence does not arise.
(10) Hence, keeping the legal position in mind not only trial court but also this court recorded a finding that the cheque was not given in discharge of a legally enforceable liability and the presumption available under section 139 of the negotiable instruments act, 1881, cannot be pressed into service by the holder of the cheque.
(11) In the light of the view taken by me, there is no need to modify my order dated 14 - 02 - 1997.