Magistrate on the point of financial capacity of the complainant and on
the point of legally enforceable liability has held that the complainant did
not give account to the Income Tax Authority in respect of loan amount of
Rs.5,00,000/- (Rupees five laacs only) and, therefore, the learned Judge
has invoked the provision of Section 269 SS of the Income Tax Act and
held that the said amount was unaccounted and, therefore, it is not a
legally enforceable debt or other liability. Learned Counsel for the
appellant/original complainant has taken me to the judgment of the
learned Single Judge in Mr. Krishna Morajkar (supra). The submissions
of learned Counsel for the complainant that though such amount is not
shown in the account or the returns are not filed by the complainant, this
provision of Section 269 SS, at the most, can be only against the taker
and not the giver are accepted. The learned Single Judge of this High
Court in the said case held that the provisions of Section 269 SS of the
Income Tax Act have no bearing and that is not to be taken into account
while considering legally enforceable liability or debt due from the
enforceable liability and also assuming the facts of financial capacity of
the applicant. The said view is correct and hence the findings given by
the learned Magistrate referring the provision of the Income Tax Act is
illegal. However, apart form this finding, the judgment of the learned
Trial Court is to be looked into and to be examined on the basis of the
evidence of the parties and the settled position of law.
IN THE HIGH COURT OF BOMBAY AT GOA
CRIMINAL APPEAL NO.45 OF 2011
Mr. Sunil Thukral,
V/s
Mr. Tolu @ Tulo Puno Velip,
CORAM : SMT. MRIDULA R. BHATKAR, J.
DATE : 12th FEBRUARY, 2014
Citation;2016 ALLMR(CRI)208
This appeal is preferred by the original complainant against the
judgment and order dated 19/01/2011 passed by the learned Judicial
Magistrate First Class at Panaji in Criminal Case No.OA 107/09/C,
thereby acquitting the respondent/accused from the offence punishable
under Section 138 of the Negotiable Instruments Act of 1881.
2. It is the case of the original complainant that in the month of
February, 2008, the respondent/accused approached the complainant for
loan of Rs.5,00,000/- (Rupees five lacs only) and therefore on
26/02/2008, the original complainant gave him loan of Rs.5,00,000/-
(Rupees five lacs only) on condition that he would repay the said amount
within a period of 6 months and if not paid he would pay interest at the
rate of 5% on the said amount. At the relevant time, i.e. on 26/02/2008,
the original complainant and the respondent/accused entered into an
agreement in which the respondent/accused had acknowledged the debt
of Rs.5,00,000/- (Rupees five lacs only) and also acknowledged the
repayment of the said loan with interest. The respondent/accused issued a
postdated cheque dated 26/08/2008, bearing no.583394 of Rs.5,00,000/-
(Rupees five lacs only) drawn on State Bank of India, Canacona Branch,
Goa. The said cheque was deposited by the original complainant, but it
was dishonoured for want of sufficient funds. The complainant therefore
sent legal notice to the respondent/accused and demanded the said
amount due to him. However, the said liability was denied by the
respondent/accused by replying to the said notice. The original
complainant thereafter lodged criminal case in the Court of Judicial
Magistrate First Class, Panaji, Goa under Section 138 of the Negotiable
Instruments Act. The said case was tried by the learned Magistrate and it
was concluded in dismissal of the said complaint and the
respondent/accused was acquitted from the offence punishable under
Section 138 of the Negotiable Instruments Act. Hence, this appeal.
3. Learned Counsel for the original complainant/appellant has
submitted that the learned Judge while appreciating the evidence on the
point of facts and also law has committed error and especially on the
point of not properly appreciating the presumption under Section 139 of
the Negotiable Instruments Act. He submitted that the learned Trial Court
did not frame the points of determination as per the requirement of law
under Section 138 of the Negotiable Instruments Act. It was necessary
for the learned Trial Court to frame point of determination on the point in
respect of the proof of ingredients of Section 138 of the Negotiable
Instruments Act. However, the learned Judge has framed only one point
as to whether the complainant could prove that the accused has issued the
cheque towards the discharge of his liability or not. The learned Counsel
has submitted that the learned Trial Court did not consider that the
complainant has discharged his burden of proving that the loan of
Rs.5,00,000/- (Rupees five lacs only) was accepted by the
respondent/accused. The Trial Court ought to have accepted the contents
in the agreement dated 26/02/2008, which is marked at Exhibit 31. He
referred the statutory notice dated 1/12/2008 and also reply given to the
notice dated 3/02/2009, marked Exhibit 37. Learned Counsel argued that
the learned Trial Judge has erroneously mixed up the other transactions of
land dealings which had taken place between the original complainant
and the respondent/accused. The respondent/accused had mortgaged a
land with the Bank and the original complainant wanted to buy the said
mortgaged land. Original complainant had entered into an agreement of
sale in respect of the said mortgaged land, where the respondent/accused
was a co-owner. The learned Counsel has submitted that the Trial Judge
has erred in holding that the original complainant was not having the
financial capacity to give loan of Rs.5,00,000/- (Rupees five lacs only) in
February, 2008. The learned Trial Court gave wrong finding that in view
of Section 269 SS of the Income Tax Act, a person who gives loan is
bound to disclose the accounts to the Income Tax Authority. The learned
Counsel submitted that the admission given by the original complainant
on the point that he did not file returns and did not show amount of
Rs.5,00,000/- (Rupees five lacs only) loan is wrongly appreciated by the
learned Trial Court. He submitted that the bar of Section 269 SS of the
Income Tax Act is not against the giver, but it is against the taker. To
substantiate this, he relied on the judgment of Jayantilal M. Jain v/s.
J.M. Sons & Ors. reported in 1991 (3) BCR 694. He further relied on the
judgment of the Single Judge of Bombay High Court at Goa Bench in
Mr. Krishna Morajkar V/s. Mr. Joe Ferrao & State of Goa, in Criminal
Appeal no.6 of 2012, which was pronounced on 19/07/2013 in which the
learned Judge has held that the provisions of Section 269 SS and so also
271 D of the Income Tax Act have absolutely no bearing in respect of
ascertaining the fact of legally enforceable liability of the accused. The
learned Counsel on the point of shifting of onus and the presumption
under Section 139 and 118 of the Negotiable Instruments Act relied on
the evidence and the cross-examination of the complainant. The
complainant has examined himself to prove his case, and he was crossexamined
by the respondent/accused. No evidence was tendered by the
accused. It was argued that the complainant has proved his case on the
point of giving loan, acceptance of the loan, issuance of the cheque,
dishonouring of the cheque and so also on the point of issuing statutory
notices. Thus, by tendering the oral as well as documentary evidence he
has proved all the ingredients under Section 138 of the Negotiable
Instruments Act. He submitted that the respondent/accused in the crossexamination
has put some suggestions to the appellant. The suggestions
were given in respect of the other transaction which have admittedly
taken place between the respondent/accused and the complainant on
26/02/2008. The said transaction is not denied by the original
complainant. However, if at all the original respondent has adopted the
defence that the cheque of Rs.5,00,000/- (Rupees five lacs only) was
given by way of security in respect of the other transaction or was stolen,
then it is obligatory on the part of the respondent/accused to lead
evidence to discharge that burden. Learned Counsel has submitted that
once the complainant has proved all the ingredients under Section 138,
then it is obligatory on the part of the respondent/accused to dislodge his
case either by eliciting admissions in the cross-examination or by
adducing an independent evidence which will dislodge the case of the
original complainant. Mere suggestions given to the party are valueless
to form any concrete and substantial defence. He pointed out that the
respondent/accused though has referred and relied on agreement of sale in
respect of the mortgaged land, he did not produce the said agreement of
sale before the Court. Similarly, reply given to the notice dated
10/04/2008 i.e. Exhibit 38 is also not proved, but only produced when his
statement was recorded under Section 313 of Cr.P.C. Mere production of
the document cannot take place of the proof. In support of his submission
he relied on the unreported judgment of the Delhi High Court in the case
of V.S. Yadav V/s. Reena in +CRL. A. No.1136 f 2010, which was
pronounced on 21/09/2010. If the reliable evidence is produced by the
complainant, then the presumption under Section 139 of the Negotiable
Instruments Act stands in favour of the original complainant and, thus,
the onus shifts on the accused to show that due to certain facts or
transactions the loan was not a legally enforceable liability. He relied on
the judgment of the learned three Judges of the Hon'ble Supreme Court in
Rangappa v/s. Mohan reported in 2010 AIR SCW 2946. The learned
Counsel submitted that assuming that both the parties i.e. the complainant
and the accused in the case fail to prove their respective case under the
Negotiable Instruments Act, then in that event the presumption which is
in favour of the complainant shall prevail. In support of his submissions,
he relied on the judgment of Tarmahomed Haji Abdul Rehman V/s.
Tyeb Ebrahim Bharamchari reported in 1949 BLR 51 219. He prayed
that the judgment of the learned Magistrate be set aside and respondent be
convicted.
4. Per contra, learned Counsel for the respondent has submitted that
the order of acquittal passed by the learned Judge is well reasoned and the
findings given by the learned Judicial Magistrate First Class are correct.
She submitted that the circumstances, if at all considered on the basis of
the evidence of the complainant then the question arises as to why the
complainant should pay big amount of Rs.5,00,000/- (Rupees five lacs
only) to the accused? She read over the relevant portion in the crossexamination
of the complainant where complainant has given admission
that the accused was known to him through one Virendra Divkar and he
did not have earlier acquaintance with him. She further raised another
doubt that if at all there was a land dealing between the parties and
consideration of Rs.6,00,000/- (Rupees six lacs only) towards the land
was paid by the complainant to the respondent and others, who were the
co-owners of the said land by satisfying the mortgaged debt of
Rs.1,81,000/- (Rupees one lac eighty one thousand only), then why the
amount of Rs.5,00,000/- (Rupees five lacs only) was paid to the
respondent. If some amount by way of consideration was received by the
respondent/accused then he was not in need of money to raise loan of the
amount of Rs.5,00,000/- (Rupees five lacs only). Learned Counsel
further submitted that the complainant has failed to prove his financial
capacity to lend amount of Rs.5,00,000/- (Rupees five lacs only) at the
relevant time. She further pointed out that in the cross-examination
complainant has admitted that certain amount was contributed by his
father, certain amount was contributed by his sister when he gave the
amount of Rs.5,00,000/- (Rupees five lacs only) to the complainant. She
submitted that if at all the complainant himself was required to borrow or
ask for money to give the amount towards the loan, this itself is damaging
to the case of the complainant. The learned Counsel has submitted that
no documentary evidence like passbook or bank statement is produced to
prove the fact of his financial position and how the payment of
Rs.5,00,000/- (Rupees five lacs only) was made by the complainant; as
the payment was made in cash. It was contended that the accused has
denied the agreement dated 26/02/2008 at Exhibit 31 in the crossexamination
of the complainant and, therefore, it was not necessary for
the accused to step in the witness box and adduce further evidence to
discharge his burden of rebutting the presumption which stood in favour
of the complainant. Learned Counsel in support of her submissions has
relied on the judgment of the Bombay High Court in Anjana Balkrishna
Shewale V/s. Chayya Baban Jagdale & Anr. reported in 2008 ALL MR
(Cri.) 2694, wherein it was held in paragraph 3 of the judgment by the
learned Judge that no prudent person will borrow such huge amount to
pay installment thereon so as to help a friend. On the same point, she
also relied on the judgment in the case of Nishith M.P. Verlekar V/s.
Ashpaque Marfani reported in 2009 ALL MR (Cri.) 1001. In the said
case, whether the complainant was in a position to advance the large sum
of money was doubted by the Hon'ble Judge and has considered that the
defecne adopted by the accused raising question in respect of the
financial capacity of the complainant cannot be rejected outright.
Learned Counsel on the point of proof or on the point of discharging the
burden of the rebuttal in respect of presumption under Section 139 of the
Negotiable Instruments Act has relied on the judgment of Shri Vinay
Parulekar V/s. Shri Pramod Meshram reported in 2008 ALL MR (Cri.)
461.
5. In the present case, the issue mainly revolves round as to whether
the complainant has discharged the burden to prove the legally
enforceable debt was due from the accused or not. The learned Counsel
of both the sides have relied on the various judgments of this Court and of
the Hon'ble Supreme Court. The proposition of law in respect of Section
138 and 139 of the Negotiable Instruments Act is now settled by the
catena of judgments. Section 138 of the Act was enacted with an object
to improve the credibility of transactions by the negotiable instruments
and to facilitate the bank transactions in a smooth manner. It is
experienced that recourse of criminal trial is preferred to civil trial as it
does not require to pay court fees and it is quicker. However, the section
is penal with severe consequences and therefore the section warrants a
strict construction on the proof of the facts. If at all the ingredients under
Section 138 are proved by the complainant then presumption under
Section 139 of the Act stands in his favour. Section 139 reads as under:
139. Presumption in favour of holder – It shall be
presumed , unless the contrary is proved, 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.
The words that “unless contrary as proved” though are used in the section
the degree of the proof is not expected to be beyond reasonable doubt or
it does not call for strict proof of the facts”. For the purpose of rebuttal of
the presumption, the standard of proof of the facts is required by applying
the rule of preponderance of probabilities. When it is said a fact is proved
it means that it is legally and judicially believed by the Court and
presumption is an additional support given to such acceptance. The
presumption under Section 139 is a similar provision like Section 118 of
the Negotiable Instruments Act. On this point, I rely on the ratio laid
down in the case of Rangappa V/s. Mohan (supra) at paras 12 & 14
which reads as under:
12. The respondent-claimant has also referred to the
decision reported as Mallavarapu Kasivisweswara
Rao v. Thadikonda Ramulu Firm & Ors., 2008
(8) SCALE 680, wherein it was observed:
“Under Section 118(a) of the Negotiable Instruments
Act, the court is obliged to presume, until the contrary
is proved, that the promissory note was made for
consideration. It is also a settled position that the
initial burden in this regard lies on the defendant to
prove the non-existence of consideration by bringing
on record such facts and circumstances which would
lead the Court to believe the non-existence of the
consideration either by direct evidence or by
preponderance of probabilities showing that the
existence of consideration was improbable, doubtful
or illegal. ...”
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 or 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 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.”
6. On the background of this ratio, the evidence tendered by both the
parties and the facts of the case are to be assessed. The learned
Magistrate on the point of financial capacity of the complainant and on
the point of legally enforceable liability has held that the complainant did
not give account to the Income Tax Authority in respect of loan amount of
Rs.5,00,000/- (Rupees five laacs only) and, therefore, the learned Judge
has invoked the provision of Section 269 SS of the Income Tax Act and
held that the said amount was unaccounted and, therefore, it is not a
legally enforceable debt or other liability. Learned Counsel for the
appellant/original complainant has taken me to the judgment of the
learned Single Judge in Mr. Krishna Morajkar (supra). The submissions
of learned Counsel for the complainant that though such amount is not
shown in the account or the returns are not filed by the complainant, this
provision of Section 269 SS, at the most, can be only against the taker
and not the giver are accepted. The learned Single Judge of this High
Court in the said case held that the provisions of Section 269 SS of the
Income Tax Act have no bearing and that is not to be taken into account
while considering legally enforceable liability or debt due from the
enforceable liability and also assuming the facts of financial capacity of
the applicant. The said view is correct and hence the findings given by
the learned Magistrate referring the provision of the Income Tax Act is
illegal. However, apart form this finding, the judgment of the learned
Trial Court is to be looked into and to be examined on the basis of the
evidence of the parties and the settled position of law.
7. In the present case, the complainant has stepped in the box and has
given evidence in respect of the issuance of the cheque, presentation of
the cheque, dishonouring of the cheque of Rs.5,00,000/- (Rupees five lacs
only), so also the service of the statutory notice, reply given thereby
refusing to make the payment. Thus, the complainant has initially proved
the fact that he was holder of the cheque of Rs.5,00,000/- (Rupees five
lacs only) and complied the procedure required under Section 138 of the
Negotiable Instruments Act. The crux of the matter which is required to
be answered in the present case is whether the cheque of Rs.5,00,000/-
(Rupees five lacs only) was in fact given by the accused to the
complainant towards the hand-loan of Rs.5,00,000/- (Rupees five lacs
only) given by the complainant or not? The respondent/original accused
in the cross-examination has brought the facts in respect of one more
transaction between the complainant and the original accused. The
complainant has admitted that there was a land dealing between the
parties and the complainant has paid Rs.6,00,000/- (Rupees six lacs only)
to the accused and the co-owners towards the consideration amount of the
said land. Out of the said amount the loan of Rs.1,81,000/- (Rupees one
lac eighty one thousand only) was cleared as the said land was mortgaged
with the Bank. This is admitted by the respondent/original accused in his
reply to the notice, Exhibit 37.
8. The notices exchanged by the parties throw light on the doubtful
part of the case of the complainant. Both the parties have admitted a fact
that the land dealing has taken place on 26/02/2008 and the parties have
entered into an agreement of sale before the notary and the amount of
Rs.1,81,000/- (Rupees one lac eighty one thousand only) was deposited
by the complainant to clear the mortgaged land. The truthfulness of the
evidence of the complainant can be tested on the basis of the notices. The
statutory notice was given by the complainant to the accused on
1/12/2008 marked at Exhibit 36. In the said notice, the complainant in
paragraph 1 had said that:
“1. In discharge of legally enforceable debt and liability, following
through the agreement dated 26/02/2008, which you have
entered into with my client, you had issued to my client, a
cheque dated 26/08/2008 bearing no.583394 drawn on the
State Bank of India, Canacona branch, Canacona Goa for a
sum of Rs.5,00,000/- (Rupees Five Lakhs only) as the part
payment of the total amount payable by you to my client.”
(emphasis placed)CRIA No.45/2011
17
9. It is to be noted that in the entire notice the complainant has not
mentioned anywhere that he has given the loan of Rs.5,00,000/- (Rupees
five lacs only) to the respondent and the said amount of loan is due from
him. The entire notice is drafted skillfully that it only refers the
agreement dated 26/02/2008. Interestingly, on the same date, as per the
case of the complainant two agreements were entered into i.e. one for
agreement for sale in respect of the land and the second alleged
agreement, Exhibit 31 was entered into between the complainant and the
respondent wherein the respondent has acknowledged the loan of
Rs.5,00,000/- (Rupees five lacs only) which was paid on the same day by
the complainant to the respondent. The case of the complainant is that
these two transactions are independent transactions and are not connected
with each other and therefore in the notice dated 1/12/2008, exhibit 36
there was no reference of the agreement of sale or any other transaction
related to loan which had taken place between the complainant and the
respondent. On perusal of the said notice, especially para 1, it is found
that in the notice nowhere it is mentioned that the said amount was
demanded towards the loan of Rs.5,00,000/- (Rupees five lacs only)
given to the respondent. The notice is vague in respect of the contents
regarding repayment and interest in the agreement dated 26/02/2008.CRIA No.45/2011
18
Surprisingly, in paragraph 1, the complainant has made a reference of the
'part payment' of the total amount payable by the respondent to the
complainant. This creates a doubt as to why reference of part payment of
the total amount payable was made, if at all it was a notice for repayment
of loan of Rs.5,00,000/- (Rupees five lacs only). Moreover, though there
is a mention on the agreement, Exhibit 31 of the interest of 5% of the
amount, no demand was made of the 'interest'. It is to be noted that the
complainant and the respondent are not friends, but only know each other
due to land dealing. Thus, it appears that amount of Rs.5,00,000/-
(Rupees five lacs only) was a part payment towards any other transaction
and there was no demand for loan as the case of the complainant is.
Especially, in the absence of specific mention or specific demand that
amount of Rs.5,00,000/- (Rupees five lacs only) was paid towards the
loan and therefore the demand was made, the doubt created in respect of
the words, “part payment of the total amount payable” gets stronger.
10. This notice was replied by the respondent by reply dated
3/01/2009. In the reply, the respondent has referred one earlier notice
dated 10/04/2008 sent by the complainant to the respondent. He has also
referred the agreement dated 26/02/2008. However, in paragraph 3 heCRIA No.45/2011
19
made it clear that the same transaction was in respect of the loan and also
his family members and the respondent had no title to execute any sale
deed and, therefore, the complainant was requested to collect the amount
of Rs.1,81,000/- (Rupees one lac eighty one thousand only) with interest
from the respondent within 5/06/2008 to 10/06/2008. Though in the
notice, Exhibit 36, word “agreement” is used and notice, Exhibit 38,
words “agreement of sale” are used, it is apparent that notice is replied
with reference to the agreement of sale dated 26/02/2008. He has denied
that there was legally enforceable debt or liability towards the purported
agreement dated 26/02/2008. Moreover, in paragraph 8, respondent has
specifically referred to the contents of the notice dated 10/04/2008 sent
by the complainant that the amount was paid towards the entire
consideration. The contradiction in contents between the two notices is
stark. In the notice dated 1/12/2008, Exhibit 36 complainant has stated
that amount towards payment in terms of agreement dated 26/02/2008
and the respondent has issued the cheque in favour of the complainant.
However, in previous notice dated 10/04/2008, Exhibit 38 pointed out by
the learned Counsel for he respondent, in paragraph 2 the complainant
while addressing the respondent has mentioned that the complainant,
pursuant to the agreement of sale dated 26/02/2008 had paid the entireCRIA No.45/2011
20
consideration in respect of the said property payable to him. Thus, there
is obvious contradiction in the notices sent by the complainant i.e. Exhibit
36 and Exhibit 38. The learned Counsel for the respondents has correctly
pointed out that specific denial though was made by the respondent in the
notice reply, Exhibit 37 the said denial or the said contention is not at all
mentioned in the complaint filed by the complainant before the learned
Magistrate. The complainant has taken a very clever stand that there
were two independent transactions between the parties and therefore the
complainant did not mention anything in respect of the other transaction.
This submission would have been considered if there would not have
been ex facie contradictions in the notices given by the complainant
himself to the respondent. The complainant has taken a very tricky stand
in the notice which was sent on 1/12/2008. The notice was drafted in
such a manner that it suppressed the fact of payment of Rs.5,00,000/-
(Rupees five lacs only) to the respondent towards a loan amount and the
demand was made for the repayment of Rs.5,00,000/- (Rupees five lacs
only).
11. The submissions were advanced by the learned Counsel for the
complainant on the point of rebuttal of presumption and it was arguedCRIA No.45/2011
21
that when the agreement dated 26/02/2008 i.e. Exhibit 31 was relied and
proved by the complainant then it was obligatory on the part of the
accused to step in the witness box and tender evidence to show that the
said document was false. The learned Counsel submitted that the
complainant has stated that the said agreement was executed by the
accused before notary and it was signed by the respondent and also by
him. Thus, the complainant has heavily relied on the proof of the said
document which is a documentary evidence supporting the case on the
point of payment of Rs.5,00,000/- (Rupees five lacs only). The said
document is not admitted by the original accused either in the notice or
while taking the cross-examination of the witness. Indeed, certain
admissions sought by the respondent in the cross-examination have
created substantial doubt regarding the transactions as claimed by the
complainant. The complainant has admitted in the evidence that he knew
accused through one Virendra Divkar. Virendra Divkar introduced
accused to him. The purpose of introduction is also brought on record in
the cross-examination that the complainant was interested in purchasing
the mortgaged property in Canacona and therefore Shri Divkar introduced
accused and thereafter he executed the agreement with the accused in
respect of the said property. It was argued that when respondent hasCRIA No.45/2011
22
denied the execution of the said document then it is his burden to prove
that document is forged or fake, as he who asserts, has to prove is a rule
of evidence. However, the learned Counsel for the complainant has lost a
sight of the rule of evidence that the negative burden cannot be cast
especially when there is a case of forgery or fake documents. In the case
of forgery or a fake document the burden entirely lies on the person who
claims that the document is genuine. This positive burden is required to
be discharged by the complainant. The admission is sought in the crossexamination
that the said agreement at Exhibit 31 was executed in the
presence of one Virendra Divkar. The learned Counsel for the respondent
has rightly pointed out that it was necessary for the respondent to
examine Virendra Divkar or a notary before whom it was executed. If at
all the document executed between the two parties is not witnessed by
any person, then there was no question of examining the witness.
However, when the evidence is available then it is necessary for a party to
adduce best and adequate evidence in support of his case. Thus, the
document, agreement at Exhibit 31 which is presented as a documentary
evidence of the complainant, though it is exhibited cannot be believed to
prove the fact of the acknowledgment of the debt of Rs.5,00,000/-
(Rupees five lacs only) by the respondent. CRIA No.45/2011
23
12. Accused has not stepped in the box. The learned Counsel for the
respondent has submitted that when either of the parties have not proved
the fact then if at all there is a presumption then it should reign. The
submissions as a proposition of law is correct, however every criminal
case is required to be examined, ascertained and decided on the facts of
each case and the evidence adduced before the Judge.
13. I place reliance on the ratio laid down in the case of Shri Vinay
Parulekar (supra), wherein it is held at paras 14 and 15 thus:
“14. Upon consideration of various judgments as
noted hereinabove, the position of law which emerges
is that it is not necessary for the accused to disprove
the existence of consideration by way of direct
evidence. Inference of preponderance of probabilities
can be drawn not only from the materials on record
but also by reference to the circumstances upon
which he relies. The accused can raise a probable
defence from the material brought on record by him,
so also by the complainant himself. Though it is
obligatory on the Court to raise presumptions
contemplated under Sections 118, 138 and 139 in
every case, where the factual basis for raising of the
presumption has been established, what is needed for
the accused is to raise a probable defence or that the
consideration does not exist. The presumption could
be rebutted either by leading evidence or bringing
facts on record in cross-examination of the
complainant which could make the case of the
complainant improbable that the cheque was issued inCRIA No.45/2011
24
discharge of any debt or other liability or through the
documents produced and proved through the
complainant.
15. If some material is brought on record consistent
with the innocence of the accused which may
reasonably be true, even though it is not positively
proved to be true, the accused would be entitle to
acquittal. The accused can prove the non-existence of
a consideration by raising a probable defence. If the
accused 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 will shift to the complainant who will be
obliged to prove it as a matter of fact and upon its
failure to prove will disentitle him to the grant of
relief on the basis of negotiable instrument. It is true
that in case, where the respondent failed to discharge
the initial onus of proof by showing the non-existence
of consideration, the complainant would invariably be
held entitle to the benefit of presumption arising
under Section 118(a) in his favour. However, the
Court may not insist upon the accused to disprove
existence of consideration by leading direct evidence
as the existence of negative evidence is neither
possible nor contemplated and even if led, require to
be seen with doubt. The standard of proof in such
cases evidently is preponderance of the probabilities.
Inference of preponderance of probabilities can be
drawn not only from the materials on record but also
by reference to the circumstances upon which he
relies. The onus, contemplated under Sections 118
and 139 of the Act, upon the accused is not as heavy
as is normally upon the prosecution to prove the guilt
of the accused.”
In the present case, the accused though has not stepped in the box and has
not adduced any evidence by way of cross-examination and by way ofCRIA No.45/2011
25
documentary evidence, which are the notices and so also by pointing out
the circumstances, created a doubtful situation regarding the genesis of
the transaction and the defence of the accused may be probable. I am of
the view that the respondent has rebutted the presumption in favour of the
complainant. Thus, the complainant has in fact failed to prove the
truthfulness of the repayment of the loan of Rs.5,00,000/- (Rupees five
lacs only) and the demand made by him for the repayment of the said
Rs.5,00,000/- (Rupees five lacs only). If at all, such transaction is not
proved then under Section 138 of the Negotiable Instruments Act, the
complainant cannot stand in the course of law. In view of this, I place
reliance on the judgment of the Bombay High Court in the case of Anil,
s/o. Baburao Dange V/s. Narayansingh, s/o. Budsingh Rajput reported
in CDI 2008 BHC 968, wherein it is held at para thus:
“5. The Trial Court repelled defence of the accused
that the cheque was issued under intoxication or that it
was stolen away. The Trial Court, however, found that
the complainant failed to prove genesis of the
transaction. For, it was the case of the complainant
that he entered into transaction of purchasing a shop
and gave the amount to the accused. The
complainant/applicant did not produce the written
agreement on record. He did not spell out the details
of such transaction. The learned Trial Judge found that
version of the applicant could not show the nexus
between the transaction of purchasing a shop and the
issuance of the cheque. The learned Judge of the Trial
Court found that the applicant failed to prove that theCRIA No.45/2011
26
cheque was issued with a view to discharge the
existing liabilities. These findings of the facts cannot
be regarded as perverse, particularly, when adverse
inference was drawn against the applicant due to nonproduction
of the best available primary evidence. The
applicant was admittedly having the agreement with
him, yet, the same was not produced.”
14. Thus, in view of this, the finding given by the learned Judicial
Magistrate First Class is to be maintained and it is confirmed. Appeal
rejected.
15. This Court is pleased to appreciate the assistance of both the
Counsel while deciding the appeal. Registry is directed to make the
payment of Rs.5,000/- (Rupees five thousand only) to Ms. N. Pimenta,
learned Counsel appearing for the respondent under legal aid scheme.
SMT. MRIDULA R. BHATKAR, J.
NH/-
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