Defence that cheque was stolen

Defence was taken that cheque was stolen.However no report was lodged in police station.No instruction were given to bank to stop payment.Defence was struck down
THE HIGH COURT OF DELHI AT NEW DELHI

Judgment delivered on : 11.09.2009

SHRI ASHOK KUMAR

versus
GULSHAN KUMAR


2. This appeal is directed against the judgment of the learned
Metropolitan Magistrate (in short „Magistrate‟)dated 20.10.2005
whereby the respondent/accused has been acquitted.
3.
The case set up by the appellant/complainant before the trial
court is as follows:-
4.
The appellant/complainant is a proprietor of a concern by
the name of M/s Gaba Trading Company.
complainant is in the business of „cloth‟.

The appellant/
In the course of his

business, the appellant/complainant sold a certain quantity of
cloth to the respondent/accused vide bill no. 7 dated 09.05.2001.
The said bill was for a sum of Rs 65,000/. In satisfaction of the
said debt, i.e., the afore-mentioned bill, the respondent/accused
issued two cheques bearing no. 658024, dated 12.05.2001, drawn
on UCO Bank, Dr Mukherjee Nagar, Delhi, in the sum of
Rs. 15,000/-, and cheque bearing No. 599135, dated 15.10.2001,
also drawn on UCO Bank, Dr. Mukherjee Nagar, Delhi, in the sum
of
Rs 50,000/-.
The said cheques were deposited by the
appellant/complainant with his banker on 15.10.2001. However,
to
his
surprise,
both
the
cheques
were
dishonoured,
and
consequently, returned by his banker, alongwith a cheque return
memo.
This propelled the appellant/complainant to trigger the
proceedings under Section 138 of the Negotiable Instruments Act,
1881 (hereinafter referred to as the „N.I. Act‟). Consequently, a
statutory notice demanding from the respondent/accused, the
payment in respect of the afore-mentioned cheques was issued on
22.10.2001, by the appellant/complainant.
The acknowledgment
card was received by the appellant/ complainant, on 27.10.2001.
5.
On failure of the respondent/accused to pay the money
within a period of 15 days of service of the legal notice issued by
the appellant/complainant, an offence under the provisions of
Section 138 of the N.I. Act, stood committed.
Resultantly, a
criminal complaint was lodged.
6.
At this juncture, it would be perhaps pertinent to note, that
the complaint was lodged in the Court of the learned Magistrate
on 01.12.2001, whereupon, it was registered. By an order dated

23.03.2002, summons in this case were issued by the trial court.
On 18.07.2002, the respondent/accused alongwith his counsel
entered appearance. On an application moved by the accused, he
was admitted to bail on his furnishing a bond in the sum of
Rs 65,000/- and a surety of a like amount. The matter was posted
for 31.07.2002. On the said date, the following order was passed:-
“Present:- Counsel with complainant.
Accused with counsel.
Compromise not effected. Counsel for accused requests
for adjournment. Put up 05.08.2002 for compromise or
arguments on notice u/s 251 Cr.P.C. L/O given.
sd/-
ASJ
31.7.2002.”
7.
Thereafter the matter was posted for 05.08.2002 when the
accused stated before the Court that he was willing to pay
Rs 65,000/- to which the appellant/complainant gave his consent.
For effectuating a compromise, the matter was posted for hearing
on 05.09.2002. The proceedings of 05.09.2002 read as follows:-
“Present: Ld. counsel for the parties alongwith the parties.
Accused has dragged (s.i.c. retracted) out from his
statement made in the Court on 5.08.2002. Its effect will be
seen at the proper time. On the contrary, he has moved
an application for recalling of summoning order. Copy
given to the complainant.
Arguments on 12.09.2002.
sd/-
ASJ
31.7.2002.”
8.
It transpires that on 05.09.2002, when the matter came up
before the trial court, the accused resiled from the statement

made on 05.08.2002, and as a matter of fact, moved an application
for recall of the summoning order. The contents of the application
have a bearing on the case, which has been discussed by me in the
latter part of my judgment. To cut the narrative with respect to
proceedings in Court short, on 28.09.2002, the trial court heard
the submissions of the counsel for the respondent/accused on his
application for recalling the summoning order. The court came to
the conclusion that while the matter required proof, a prima facie
case was made out against the accused under Section 138 of the
N.I. Act.
Consequently, the court proceeded to frame a notice
under Section 251 of the Cr.P.C against the respondent/accused
keeping all questions open.
9.
In support of his case, the appellant/complainant (CW1)
examined himself; the Manager of the drawer Bank Mr A.S.
Mehmi, (CW2), as also, the official of the drawee bank Rajender
Kr. Rastogi (CW3). On the other hand, the respondent/accused in
addition to getting his statement recorded under Section 313 of
the Cr.P.C. also examined himself as a defence witness (DW1),
alongwith one, Harish Kumar (DW2). The trial court, on perusal of
the evidence on record, came to the conclusion that the
appellant/complainant had failed to prove his case beyond a
reasonable doubt. It granted the benefit of doubt to the accused
and proceeded to acquit the accused of the charge framed against
him. The trial court arrived at this conclusion as it disbelieved the
case set up by the appellant/complainant in view of the following
weaknesses noticed by it, in his case:-

(i)
the appellant/complainant in his testimony had said that
whenever the goods were sold on credit, the buyers would append
their signatures on the bill in confirmation of receipt of goods.
The carbon copy of the bill which was produced by the
appellant/complainant
did
not
bear
the
signatures
of
the
respondent/accused or any of its employees as was the market
practice when goods were supplied on credit;
(ii)
while the trial court accepted the fact that since the cheques
in issue, were signed by the respondent/accused and hence,
statutory presumption under Section 118 read with Section 139 of
the
N.I.
Act
had
to
be
drawn
in
favour
of
the
appellant/complainant that they were issued in consideration of an
enforceable debt, it held that the presumption was rebuttable, and
the respondent/accused had been able to set up a probable
defence on account of the following factors:-
(a)
the
cheques
in
issue,
even
though
signed
by
the
respondent/accused had the name of the drawee filled in by the
appellant/complainant.
The
appellant/complainant,
in
his
testimony, had stated that he had only filled in the name of the
drawee, and had not adverted to the fact that even the date on the
two cheques in issue was filled in by him and thus, was not in the
handwriting of the respondent/accused.
On visual examination,
the trial court came to the conclusion that the dates entered on
the
cheques
were
not
in
the
handwriting
of
the
respondent/accused because of the peculiar manner in which the
numerical „5‟ was written;

(b)
the appellant/complainant had filed what purported to be the
reply of the respondent/accused dated 07.11.2001 (Ex CW1/9) at
the fag end of the trial. Even so, the reply which was purportedly
issued by the lawyer of the respondent/accused was issued by one,
Mr
S.L.
Sethi;
which
was
not
believed
since
the
respondent/accused in his testimony had clearly stated that even
though he had signed a reply to the legal notice dated 22.10.2001,
(Ex CW1/6) issued by the appellant/complainant, the reply dated
07.11.2001 placed on record (Ex CW1/9) was not the reply issued
by the advocate for the respondent/accused.
The trial court, in
this regard, referred to the testimony of the respondent/accused
wherein the respondent/accused went on to say that his reply had
been signed by an Advocate by the name of Mr C. L. Sethi and not
Mr S. L. Sethi. The trial court was of the opinion that in view of
this, the appellant/complainant ought to have summoned Mr S. L.
Sethi, who had purportedly issued the reply on behalf of the
respondent/accused as a witness. The trial court also took note of
the fact that respondent/accused in his testimony had said that he
could not produce the actual reply signed by him as the copy was
available with his Advocate, Mr C. L. Sethi, who had expired in the
interregnum.
(c )
The trial court was of the view that the respondent/accused
had been able to set up a plausible defence that the cheques in
issue, had been stolen by the appellant/complainant in as much as
that the appellant/complainant was in the business of the „clothes‟,
whereas the
respondent/accused was in the business of „Fur‟
which in turn were used for making soft toys; the cheques in issue,

were
stolen
by
the
appellant/complainant
when
the
respondent/accused had shifted his furniture which included racks
etcetra. to the godown of the appellant/complainant on closure of
the respondent‟s/accused business due to losses;
(d)
the bill (Ex CW1/1) against which the cheques had been
issued did not seem genuine for the following cumulative reasons:-
(i)
it was on a plain piece of paper which did not contain any
printed material;
(ii)
it did not have any serial number which was a basic
requirement of a bill book;
(iii) the carbon copy of the bill contained only hand written text;
(iv) there were no signatures of the recipient of the goods which,
according to the complainant, was a business practice in the
market when goods were sold on credit;
(v)
the case of the appellant/complainant that bill (Ex CW1/1)
was part of a bound bill book was not believed for the following
reasons:-
(a)
the bill in issue (Ex CW1/1) was larger in size than the other
copies found in the bill book;
(b)
the handwriting on the bill in issue (Ex CW1/1) and that on
the copies of bills found in the bill book differed; the copies of bill
nos 1 to 6 and 8 which were both before and after the bill in issue,
which had a serial number 7, on a visual inspection seemed as
having been prepared with the help of blue carbon, whereas the

bill against which the cheques were issued, was prepared by using
a grey coloured carbon leaf;
(c)
all other bills in the bill book had been signed by the
appellant/complainant by using an abbreviated mark, that is,
Alphabet „A‟ whereas the bill in issue (Ex CW1/1) had the mark
„Ashok‟ on it. None of the other copies of the bills in the bill book
produced by the appellant/complainant had the mark „Ashok‟
appended on it.
10.
The learned counsel for the appellant/complainant has
submitted before me that the trial court has come to an incorrect
conclusion in view of the fact that it has failed to appreciate the
evidence and the law on the issues arising before it. The learned
counsel contended that in view of the fact that it is admitted by the
respondent/accused that the cheques in issue, bore his signatures,
a
statutory
presumption
arose
in
favour
of
the
appellant/complainant that they had been issued for a valuable
consideration. The learned counsel submitted that the trial court
has had, as a matter of fact, failed to examine the contradictions in
the stand of the respondent/accused as regards how the cheques
came in possession of the appellant/complainant. In this regard,
he drew my attention to the following contradictory stand taken by
the accused:-
10.1 In the deposition of the respondent/accused in Court, he had
taken the stand that the cheques in issue, were stolen by the
appellant/complainant. While in the reply (Ex CW1/9) to the legal
notice (Ex CW 1/6), the respondent/accused had taken a stand that

the goods against which cheques had been issued had been
returned in the presence of one Mr Pankaj S/o Bhushan of
Mahabir Gali, Gandhi Nagar, Delhi, and that they were really in
the nature of a collateral security and not as consideration for the
goods
allegedly
supplied
by
the
appellant/complainant.
A
completely different stand is taken by the respondent/accused in
the application for recalling the summoning order, in as much it is
averred that the appellant/complainant, in connivance with his
mother-in-law, had taken three blank cheques bearing nos 599134,
599135 and 658024 in the sum of Rs 50,000/- 50,000/- and
15,000/- respectively, which the appellant/complainant had filled
up.
10.2
The
learned
counsel
for
the
appellant/complainant
submitted that there was no reason for the trial court to disbelieve
the authenticity of the reply (Ex CW1/9) to the legal notice, in view
of the fact that it was for the accused to place a copy of his reply
on record, if his challenge with respect to Ex CW1/9 had to come
through.
The learned counsel for the appellant/complainant
submitted that, in view of the failure of the respondent/accused to
place what he claimed was the true copy of the reply on record,
which according to the accused was issued not by Mr S. L. Sethi
but by Mr C. L. Sethi; the Court must draw an adverse inference
against the respondent/accused.
Reliance in this regard was
placed by the appellant/complainant on the provisions of Section
114(g) of the Indian Evidence Act, 1872.
The appellant/
complainant in support of his submission relied upon the judgment
of the Supreme Court in the case of Hiten P Dalal vs

Bratindranath Banerjee : (2001)6 SCC 16 at Pages 25, 26, 28
and 29 Paragraphs 24, 25, 38 and 41.
11.
As
against
this,
the
learned
counsel
for
the
respondent/accused relied largely upon the decision of the trial
court to show that the appellant/complainant is required to prove
his case beyond a reasonable doubt.
The learned counsel
submitted that in so far as the respondent/accused is concerned,
all that he is required to show to the Court was that he has a
probable defence. In demonstrating the probability of his defence,
the standard of proof which the accused is required to meet is
preponderance of probability, and not beyond reasonable doubt,
which is the standard of proof, the prosecution is required to meet.
11.1 The learned counsel for the respondent/accused, however,
fairly conceded that in the application filed before the trial court,
for recalling the summoning order, a stand different from one
which was taken by the respondent/accused both while deposing
in Court as a witness (DW1), as well as while giving his statement
to the Court under Section 313 of Cr.P.C.
12.
I
have
heard
the
learned
counsel
for
appellant/complainant as well as the respondent/accused.
the
It
cannot be disputed that once a cheque is drawn and issued, there
is a statutory presumption under Section 118 of the N.I. Act that it
was
issued
for
a
valuable
consideration.
The
appellant/complainant in his testimony has stated that the
respondent/accused had purchased cloth from him vide bill
number 7 dated 09.05.2001 (Ex CW1/1) in the sum of Rs 65,000/-.

In discharge of the liability under the bill (Ex CW1/1) the cheques
in issue Ex CW1/2 and Ex CW1/4 were issued. The said cheques
were dishonoured and returned vide cheque return memo Ex
CW1/3 and Ex CW1/5. He has also testified that legal notice (Ex
CW1/6) making a statutory demand on the accused was served;
calling upon him to pay the value of the dishonoured cheques
within a period of 15 days.
The complainant also proved the
acknowledgment card (Ex CW1/7).
In the cross-examination,
when the appellant/complainant was confronted as to why the bill
in issue had not been signed by the recipient of the goods as was
the market practice, he had stated that the bill in issue (Ex CW1/1)
was
not
signed
by
the
respondent/accused
because
the
consideration in the form of cheques had been handed over by
him. The fact that a civil suit was pending between the mother-in-
law of the appellant/complainant and the respondent/accused
pertaining
to
purchase
of
an
immovable
property
of
the
respondent/accused was accepted by the appellant/complainant.
It was, however, denied by the appellant/complainant in his
deposition that, since he had failed to make the balance payment,
the documents registered in regard to the said immovable
property were cancelled by the respondent/accused and his wife.
In his testimony, the appellant/complainant has denied that he had
either
removed goods
and articles from the
shop of
the
respondent/accused or the three cheques in issue, bearing nos
599134, 599135 and 658024 in the sum of Rs 5000/-, 50,000/- and
15,000/- respectively.
As regards cross-examination of the
appellant/complainant in respect of reply (Ex CW1/9) purportedly

issued by the respondent/accused, the appellant/complainant
denied
the
suggestion
that
the
reply
was
issued
by
the
respondent/accused through his counsel Mr C. L. Sethi and not
through Mr S. L. Sethi.
12.1 The dishonor of the cheques was proved by Mr A S Mehmi,
Manager, Uco Bank (CW-2) who proved that the cheque (Ex
CW1/2) bearing no. 658024 in the sum of Rs 15000/-, was returned
on the ground of insufficiency, while cheque bearing no. 599135 in
the sum of Rs 50,000/- (Ex CW1/4), was returned on the ground
that account was closed.
The copies of the cheque returning
register (Ex CW 2/1) and the statement of account (Ex CW2/2) and
(Ex CW2/3) were also proved by the said witness. Similarly, Mr
Rajender Kr. Rastogi, (CW3), proved the dishonoured cheque by
referring to a ledger extract (Ex CW3/1).
Interestingly, the
respondent/accused in his statement made under Section 313 of
the Cr.P.C., stated as follows:
(i)
the respondent/accused had not purchased any cloth from
the appellant/complainant;
(ii)
the
cheques
in
issue,
were
stolen
by
the
appellant/complainant, when he had shifted his goods with the
appellant/complainant; and
(iii)
that, even though he had received a statutory notice dated
22.10.2001 (Ex CW1/6) from the appellant/complainant, he had
replied to the same through his counsel Mr S. L. Sethi (note: not
Shri C.L. Sethi) who had expired in the interregnum.

13.1 It
is
only
in
his
cross-examination
that
the
respondent/accused said that he had received the legal notice (Ex
CW1/6), which was, however, replied by his counsel Mr C. L.
Sethi, and that it could not be placed by him on the record of the
Court, as the copy was not available with him, since Mr C.L. Sethi
had expired in the interregnum.
Interestingly, in the cross-
examination, there is a reference to one Mr Pankaj, as being one
of the persons, who perhaps conducted his business in the same
market
as
that
of
the
appellant/complainant
and
respondent/accused. The name Pankaj also finds mention in the
disputed reply (Ex CW1/9).
The question is as to whether the
existence of the said reply (Ex CW1/9) should be disbelieved.
According to me, the same cannot be disbelieved for the reason
that even though the reply (Ex CW1/9) was placed by the
appellant/complainant on record at a late stage in the trial, it
appears to be genuine for the reason that in the statement of the
accused under Section 313 of the Cr.P.C., which was made as far
back as on 16.09.2003, he had accepted that it was Mr S.L. Sethi
who had sent the reply on his behalf to the statutory notice of
demand issued by the appellant/complainant. The extract of the
respondent‟s/accused statement reads as follows:-
“Q4.
It is in further evidence against you that due
to dishonor of the aforesaid cheques the legal notice
dt. 22.10.2001 copy of which is Ex. CW1/6 was issued
to you on behalf of the complainant was duly received
by you vide AD card Ex.CW1/7 were despite that you
have not paid the cheque amount to the complainant.
What have you to say?
Ans.
It is correct that I had received the Demand
Notice and I had got issued reply to the same through
my counsel Sh. S.L.Sethi Adv. he is now already
expired.”

13.2
It is only in his cross-examination (DW-1) that the
complainant stated that the reply had been sent through his
Advocate Mr C. L. Sethi.
If the appellant/complainant had to
fabricate the reply (Ex CW1/9), he would not have waited till almost
the conclusion of the trial to place the reply (Ex CW1/9) on record.
Furthermore, in the reply (Ex CW1/9), there is a reference to the fact
that the goods in issue against which payment was demanded were
returned in the presence of one Mr Pankaj. In the cross-examination
of the respondent/accused, there is also a reference to Mr Pankaj as
one of the persons who had a shop in the same market where the
appellant/complainant and the respondent/accused had their shops.
In these circumstances, I find it hard to believe that the reply (Ex
CW1/9) is not genuine.
13.3 Even if it is assumed that the reply (Ex CW1/9) is not genuine,
and the stand taken therein that the cheques in issue, were only
issued as a collateral security, the stand of the respondent/accused
that the cheques were stolen does not inspire any confidence. The
defence set up by the respondent/accused that the cheques were
stolen, while he had shifted his goods to the godown of the
appellant/complainant is an improvement over the stand he has
taken in his statement under Section 313 of the Cr.P.C. The relevant
portion of his reply to a question asked of him is as follows:
“Ans.
I have not issued any such cheques in favour of
the complainant but closer (s.i.c. closure) of my shop I had
kept my goods along with three cheques out of which two
cheques of Rs. 50,000/- and one cheque is Rs.15,000/- duly
signed by me but the rest were not filed up by me in the
said cheques and as the complainant have stolen the
cheques and have misused the same by filing this
case.”
As against this, in the cross-examination he has stated as follows:-
Crl.L.P. 10-2006

“.......I closed the said shop and I vacated the said shop
which was on rent. I kept my goods in the godown of
complainant since I was having good terms with him. I
kept the cheques Ex CW1/2 & CW1/4 and one another
cheque in the drawer of my counter. The drawer was not
locked where cheques were kept.....”
13.4
A careful reading of the two versions would show that
while in the statement under Section 313 of the Cr.P.C. the
respondent/accused had simply said that on closure of his shop, he
had kept his goods alongwith the cheques which were stolen by the
appellant/complainant, there is no reference whatsoever that both
the goods and the cheques had been kept in the godown of the
appellant/complainant. This aspect that the goods and the cheques
had been kept in the godown of the appellant/complainant was an
improvement which was brought out only during the cross-
examination of the respondent/accused. Furthermore, even though
according to the respondent/accused, the cheques were stolen, he
neither wrote to the bank to stop payment of the cheques in issue
nor did he file a complaint with the police with respect to the same.
The
cheques
in issue,
were
dishonoured on the
ground of
„insufficiency of funds‟ and „account closed‟, and not because
payment against them had been stopped. What makes the defence
of the respondent/accused completely unbelievable in the instant
case, is the stand taken by the respondent/accused in the very first
instance, when an application was moved for recalling the summons
issued by the trial court. In the application for recall of summons, as
noticed
hereinabove,
as
far
back
as
on
23.03.2002,
respondent/accused has clearly stated as follows:-
“In fact, the complainant in connivance with his
mother-in-law have taken three blank cheques

the
bearing no. 599134, 599135 and 658024 in which the
complainant has filled an amount of Rs 50000/-, Rs.
50000/- and Rs 15000/-, respectively, at his own. The
applicant has never given any cheque to the
complainant.”
13.5
The aforesaid application, which is dated 05.09.2002, has
been filed through the counsel Mr Kasana, who throughout has
appeared for the respondent/accused.
When this aspect of the
matter was put to the learned counsel for the respondent/accused,
he stated that at the relevant point in time when the accused had
moved this application, he was not advised by his counsel.
This
submission is incorrect in view of the fact that the application has
been signed by the counsel, and a bare perusal of the signatures of
the
counsel
on
the
application,
when
compared
with
the
Vakalatnama, clearly shows that the signatures on the two are
identical. Therefore, to submit that the stand in the application was
taken by the respondent/accused without legal advice is completely
incorrect.
In the application, there is a reference to one more
cheque bearing no. 599134 in the sum of Rs 50,000/- apart from the
two cheques in issue, that is, Ex CW1/2 bearing no. 658024 in the
sum of Rs 15,000/- and the other cheque, Ex CW1/4 bearing no.
599134 in the sum of Rs 50,000/. The averment in Paragraph 1 of
the application that the three cheques were blank, which were taken
by the appellant/complainant in connivance with his mother-in-law
completely belies the stand of the respondent/accused that the
cheques in issue were stolen when he had shifted his goods to the
godown of the appellant/complainant.
13.6
A
careful
perusal
of
the
testimony
of
the
appellant/complainant would show that there was no suggestion

made to the appellant/complainant that there was no transaction
between the appellant/complainant and the respondent/accused, as
one
was
in the
business
of
„cloth‟
and the
other
i.e.
the
respondent/accused was in the business of dealing in „Fur‟ used in
manufacture of soft toys. Therefore, for the trial court to come to a
conclusion that there can be no business transaction between the
two as the business of the appellant/complainant related to „cloth‟,
while that of the respondent/accused was connected to „Fur‟ was
based on the ipse dixit of the respondent/accused.
13.7 As regards the trial court‟s detailed analysis of the evidence
with regard to the genuiness of the bill (Ex CW1/1), I find that the
same is rather stretched. This is specially so, in the circumstance
that the size of the bill, which is Ex CW1/1, is not greater than those
found in the bill book.
13.8 The fact that a different colour carbon leaf had been used
cannot, in my view, lead to a conclusion that there was no
transaction
between
respondent/accused.
the
appellant/complainant
and
the
The fact that the bill in issue, had not been
signed or bore the mark „Ashok‟ as against the letter „A‟ is also not
conclusive to the fact that the bill is not genuine. Apart from the
mark „A‟, there are other marks in the bill book as well. In the cross-
examination,
there
are
no
such
suggestions
made
to
the
appellant/complainant and, therefore, the appellant/complainant had
no opportunity to explain the difference even though he was recalled
for examination.
The only suggestion which was made to the
appellant/complainant in the cross-examination was whether the bill
in issue (Ex CW1/1) was signed by the respondent/accused. The

appellant/complainant had replied that the bill (Ex CW1/1) was not
signed because the respondent/accused had handed over cheques.
The market practice of obtaining signatures of the recipient of
goods, on the bill, alluded to by the appellant/complainant was
explained.
The appellant/complainant clarified in the instant case
since the cheques had been handed over, there was no credit and
hence, there was no need for obtaining signatures of the recipient.

Taking into account the aforesaid circumstances, I am of the
view that the trial court, while applying the principle that the
respondent/accused in defence is required to demonstrate only a
probable case; the standard of proof for which is preponderance of
probability; it failed to appreciate the fine nuance between a
probable case, and a completely inconsistent defence, which tethers
on falsehood. The fact that a duly signed cheque was issued by the
respondent/accused gave rise to a statutory presumption in favour of
the
appellant/complainant,
Therefore,
the
onus
respondent/accused.
in
which
the
undoubtedly
first
instance
is
rebuttable.
was
on
the
It is only on the respondent/accused putting
forth a probable defence which is consistent in material particulars,
could the onus have shifted back on to the appellant/complainant. In
this case, in my opinion, the onus did not shift back to the
appellant/complainant and hence, the conclusion drawn by the trial
court that the appellant/complainant had not been able to prove its
case beyond a reasonable doubt, was erroneous. On an appreciation
of the entire gamut of evidence placed before the trial court and the
totality of the circumstances obtaining in the case, to my mind, it is
quite obvious that the cheques in issue, were handed over to the

appellant/complainant. The presumption that they were handed over
and issued for a valuable consideration naturally flows in favour of
the appellant/complainant by virtue of the provisions of Section
118(a) of the N.I. Act. The fact that the respondent/accused was
unable to set up a probable defence which was in the very least
consistent throughout only strengthened this presumption.
The
Supreme Court in the case of M.S. Narayana Menon vs State of
Kerela and Anr (2006) 6 SCC 39 approved of the dicta elucidated
in the case Bharat Barrel & Drum Mfg. Co. vs Amin Chand
Payrelal (1999) 3 SCC 35 wherein it observed clearly that initial
onus of proof is on the drawer of a negotiable instrument and till it
shifts, the drawee can take benefit of the statutory presumption
which arises in his favour by virtue of Section 118(a) of the N.I. Act,
that it is issued for a valuable consideration.
In this context, the
observations in M S Narayana Menon (supra) at page 50
paragraph 31 being apposite are extracted hereinbelow:-
“31. A Division Bench of this Court in Bharat Barrel &
Drum Manufacturing Company v. Amin Chand Payrelal
(1999) 3 SCC 35 : [1999]1SCR704 albeit in a civil case
laid down the law in the following terms:
“12. Upon consideration of various judgments as
noted hereinabove, the position of law which
emerges is that once execution of the
promissory
note
is
admitted,
the
presumption under Section 118(a) would
arise that it is supported by a consideration.
Such a presumption is rebuttable. The
defendant can prove the non-existence of a
consideration by raising a probable defence.
If the defendant is proved to have discharged
the initial onus of proof showing that the
existence of consideration was improbable or
doubtful or the same was illegal, the onus
would shift to the plaintiff who will be

obliged to prove it as a matter of fact and
upon its failure to prove would disentitle him
to the grant of relief on the basis of the
negotiable instrument. The burden upon the
defendant of proving the non- existence of the
consideration can be either direct or by bringing
on record the preponderance of probabilities by
reference to the circumstances upon which he
relies. In such an event, the plaintiff is entitled
under law to rely upon all the evidence led in the
case including that of the plaintiff as well. In
case, where the defendant fails to discharge
the initial onus of proof by showing the non-
existence of the consideration, the plaintiff
would invariably be held entitled to the
benefit of presumption arising under Section
118(a) in his favour. The court may not insist
upon the defendant to disprove the existence of
consideration by leading direct evidence as the
existence of negative evidence is neither possible
nor contemplated and even if led, is to be seen
with a doubt....”
This Court, therefore, clearly opined that it is not
necessary for the defendant to disprove the existence of
consideration by way of direct evidence.”

take
In my view, the circumstance which the trial court failed to
into
account
was
that
if,
as
contended
by
the
respondent/accused that the cheques in issue, were stolen, why did
the respondent/accused not issue instructions to his banker to stop
payment of those cheques, or lodge a complaint with the police.
How is it that, in an application which was filed at the very initial
stage when, summons were issued by the trial court, the stand taken
by the respondent/accused was that the cheques in issue, alongwith
one more cheque, were taken by the appellant/complainant in
connivance with his mother-in-law who filled in the amounts what
purported to be blank cheques.

In view of the discussion above, I am of the opinion that the
judgment of the trial court deserves to be set aside. Accordingly, the
appeal is allowed.
Resultantly, I find the accused guilty of the
offence with which he is charged.