09.06.2025 1. Devendra Chandani S/o. Late Lalchand Chandani Aged About 50 Years R/o. Joy v. 1. Sunita Jain W/o. Vikas Jain Aged About 48 Years R/o. Mahaveer Nagar, Mahasamund
Case Details
1 2025:CGHC:22597 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR ACQA No. 814 of 2024 Judgment Reserved on : 18.02.2025 Judgment Delivered on : 09.06.2025 1. Devendra Chandani S/o. Late Lalchand Chandani Aged About 50 Years R/o. Joy Builders Colony, Saket Nagar, Indore, District - Indore (Madhya Pradesh) ... Appellant versus 1. Sunita Jain W/o. Vikas Jain Aged About 48 Years R/o. Mahaveer Nagar, Mahasamund, Police Station And District - Mahasamund (C.G.) 2. State Of Chhattisgarh Through Collector Mahasamund, District - Mahasamund (C.G.) ... Respondent(s) For Appellant : Mr. Suresh Tandon, Advocate For Respondent No. 1 : Ms. Prachi Singh, Advocate For State : Mr. Aman Tamboli, Panel Lawyer Hon'ble Shri Justice Narendra Kumar Vyas (CAV Judgment) 1. The appellant has filed the present acquittal appeal under Section 378(4) of the Code of Criminal Procedure, 1973 against the order dated 19.03.2024 (Annexure A/1) passed by the learned 2nd Additional Sessions Judge Mahasamund, District - Mahasamund (C.G.) in Criminal Appeal No. H-29/2023 by which the learned Appellate Court has acquitted the respondent No. 1 and set aside MANISH YADAV Digitally signed by MANISH YADAV Date: 2025.06.09 16:40:40 +0530 2 the order of conviction dated 24.03.2023 (Annexure A/2) passed
Facts
by the learned Judicial Magistrate First Class Mahasamund (C.G.) in Complaint Case No. 112/2015. 2. Brief facts of the case are that: (a) The complainant has filed a complaint before the learned Judicial Magistrate First Class Indore on 02.04.2013 mainly contending that Vikas Jain was doing the business of sale and finance for old cars with the assistance of respondent No. 1
Legal Reasoning
“11. Considering the sum total of the above, we find that the probable defence on the part of the accused has been established. Once such a defence is established, the burden again shifts upon the complainant to now establish his case beyond a reasonable doubt, for after all, the effect of Section 138 of the N.I. Act is a criminal conviction. Reference may be made to Rajesh Jain v. Ajay Singh12 and, more particularly Para 44 thereof, which reads as under: “44. Therefore, in fine, it can be said that once the accused adduces evidence to the satisfaction of the Court that on a preponderance of probabilities there exists no debt/liability in the manner pleaded in the complaint or the demand notice or the affidavit-evidence, the burden shifts to the complainant and the presumption “disappears” and does not haunt the accused any longer. The onus having now shifted to the complainant, he will be obliged to prove the existence of a debt/liability as a matter of fact and his failure to prove would result in dismissal of his complaint case. Thereafter, the presumption under Section 139 does not again come to the complainant's rescue. Once both parties have adduced evidence, the Court has to consider the same and the burden of proof loses all its importance. [Basalingappa v. Mudibasappa {Basalingappa v. Mudi basappa, (2019) 5 SCC 418: (2019) 2 SCC (Cri) 571: AIR 2019 SC 1983]; see also, Rangappa v. Sri Mohan [Rangappa v. Sri Mohan, (2010) 11 SCC 441: (2010) 4 SCC (Civ) 477: (2011) 1 SCC (Cri) 184: AIR 2010 SC 1898}]” 13. Keeping in view the above factors, it cannot be said that the complainant was able to discharge the burden once it had shifted back upon him, with the accused having discharged the burden of Sections 118 and 139 of the N.I. Act. 14. Consequent to the above discussion, we are of the view that the Trial Court was correct in recording a finding of acquittal in favour of the accused and reversal thereof by the High Court in terms of the impugned judgment, with particulars as in Para 1, was unjustified. As a result, the appeal is allowed.” 14. The learned Appellate Court while setting aside the order of conviction passed by the learned trial Court has recorded its finding in paragraphs 20, 21 and 22 which has already been discussed by this Court in forgoing paragraphs cannot be held to 11 suffer from perversity and illegality warranting interference by this Court. Thus, the complainant has miserably failed to prove the ingredients of Section 138 of N.I. Act, 1881 and accordingly, the learned Appellate Court has rightly acquitted the accused. This finding is in accordance with the law laid down by the Hon’ble Supreme Court in case of M/S Rajco Steel Enterprises v. Kavita Saraff and Another reported in 2024 (9) SCC 390 wherein the Hon’ble Supreme Court has held in paragraphs 10, 11 and 13 as under: “10. Mr. S. Nagamuthu, learned Senior Counsel, appearing on behalf of the accused/respondent no.1, defended the judgment of the First Appellate Court, as also of the High Court. His submission as that the complainant/petitioner did not fulfil the requirement of being “a holder in due course”, as no evidence was produced by the petitioner to show that the said cheques were issued in discharge of a legally enforceable debt and hence, he could not be a person who had, for due consideration, become the possessor of the cheques. He referred to the depositions made before the Trial Court, in support of his submission that the presumption under Section 139 read with Section 118 of the 1881 Act was not applicable in the case of the complainant/petitioner because such presumption stood effectively rebutted. He relied on the judgment of this Court in the cases:- (i) Basalingappa -vs- Mudibasappa [(2019) 5 SCC 418], (ii) K. Subramani -vs- K. Damodara Naidu [(2015) 1 SCC 99],
Arguments
Smt. Sunita Jain who is wife of other accused and the complainant and the accused are known to each other. Accordingly, through online auction the complainant has purchased Bolero car from Mahindra Finance Company bearing Registration No. CG-04-MD-0973, thereafter, the accused have proposed to purchase thes said vehicle for consideration of Rs. 5,86,000/- by depositing the advance amount with the Mahindra Finance Company. It is also the case of the complainant that the accused persons without depositing the entire sale consideration have initiated proceeding for sale of the said vehicle. Thereafter, negotiation was done between the complainant and the accused and accordingly, an outstanding amount of Rs. 1,60,000/- was shown in the account against the accused. (b) It is also the case of the complaint that to discharge liability of Rs. 1,60,000/-, the accused persons have given a cheque bearing No. 011443 dated 04.02.2013 drawn at HDFC Bank, Branch Shankar Nagar Raipur Road for Rs. 1,60,000/-. The 3 said cheque was deposited in the account maintained by the complainant at IDBI Bank, Branch Ratlam Kothi on 05.02.2013. The said cheque was returned on 05.02.2013 with endorsement “dishonored due to insufficient fund” vide memo dated 05.02.2013. Thereafter, the appellant had sent a legal notice to the accused on 19.02.2013, but neither the notice was received by the accused nor the amount was paid to the appellant which has necessitated the complainant to file a complaint case under Section 138 of N.I. Act, 1881 at Indore (Madhya Pradesh). The said complaint was transferred to the Court of Chief Judicial Magistrate Mahasamund as the cheque was drawn in the bank account at Branch Mahasamund within the territorial jurisdiction of Chief Judicial Magistrate Dhamtari and registered as Complaint Case No. 112 of 2015. 3. The complainant to prove his case has examined himself by way of an affidavit as provided under Section 145 of N.I. Act, 1881 wherein he has reiterated the stand taken by him in the complaint. The witness was extensively cross-examined wherein in paragraph 20 he has stated that he has purchased the said vehicle at Rs. 4,86,000/- which has been sold to the accused at Rs. 5,86,000/- and also stated that after expenditure incurred in documentation with regard to the vehicle and other expenses, amount of Rs. 1,60,000/- is payable to him. He has also admitted that the person who purchased the vehicle has to borne the expenditure incurred in Regional Transport Office and also admitted that when the vehicle is sold twice then only charges for change of owner of the 4 vehicle is to be paid and no other expenditure is payable. He has also admitted that in business the profit is given to the purchaser and commission is payable to agent. He has also admitted that he has not detailed the expenditure incurred towards RTO or in other heads. He has also admitted that at the time of bidding, margin money of Rs. 50,000/- was given by him and also admitted that subsequently accused has also deposited Rs. 50,000/- towards margin money and sale consideration of the vehicle Rs. 4,86,000/-. He has voluntarily stated that accused has given Rs. 50,000/- towards security, but he has not submitted any document. He has also admitted that the Mahindra and Mahindra Company has received Rs. 4,86,000/- towards the purchase of vehicle and Rs. 50,000/- from the account of accused which has already been informed by the Finance Company to him, but denied that he has misused the cheque with Navin Motwani. The complainant has exhibited documents i.e. original Cheque bearing no. 011443 dated 04.02.2013 (Exhibit P/1), Cheque Return Memo dated 05.02.2013 (Exhibit P/2), Registered Legal Notice dated 19.02.2013 (Exhibit P/3), Postal Receipt (Exhibit P/4), Acknowledgment Receipt (Exhibit P/5) and Acknowledgment Receipt (Exhibit P/6) in support of his complaint. 4. The accused has examined Sunita Jain as defence witness No. 1 who has stated that Devendra Chandani/complainant is not known to her, but Navin Motwani is known to her and his husband used to do the sale and purchase of old vehicles with Navin Motwani. The witness has also stated that on necessity of fund she has given the 5 cheque No. 011443 undated and blank cheque before her husband to Navin Motwani and also stated that the contents of the cheque have not been written by her. She has also stated thats Navin Motwani misusing the said cheque has filed complaint case against her through the complainant. The witness was cross- examined before the trial Court and has admitted that she has not made any complaint against Navin Motwani. She has also admitted that her husband used to do the business of sale and purchase of old vehicles. 5. The accused Vikas Jain has been examined under Section 313 of Cr.P.C. wherein he has stated that he used to do the business of sale and purchase of old vehicles and through online bidding he has purchased the vehicle for consideration of Rs. 4,86,000/- and he has deposited entire amount with the Mahindra Finance Company. He has also stated that Navin Motwani has taken blank signed cheque of his wife which the accused has obtained from his wife for domestic necessity and by misusing the cheque he has made a false complaint against him. The accused No. 2 Sunita Jain has also examined under Section 313 of Cr.P.C. wherein she has taken the same stand which her husband has taken. 6. The learned Judicial Magistrate First Class on the basis of evidence and material on record has recorded its finding that the cheque in question was given by the accused No. 2 which has been dishonored, accordingly, it has held that the accused No. 2 held guilty for commission of offence under Section 138 of N.I. Act, 1881. Being aggrieved with this order the accused has preferred 6 appeal before the learned 2nd Additional Sessions Judge Mahasamund who by impugned order has set aside the order of conviction. The learned Sessions Judge while setting aside the order of conviction has recorded his finding in paragraph 20 that the complainant is unable to prove that the accused has given cheque in question towards any liability and accordingly, it has set aside the order of conviction. Being aggrieved with the order of acquittal the appellant has preferred this acquittal appeal. 7. Learned counsel for the appellant would submit that the learned Appellate court has failed to appreciate the evidence available on record and wrongly acquitted the accused. He would further submit that learned Appellate court has committed material irregularity in recording the finding that the appellant is unable to prove the ingredients of Section 138 of N.I. Act, 1881 and thus, he would pray for allowing the appeal. 8. Per contra, learned counsel for the respondent would submit that the complainant has not placed any record to demonstrate that the said cheque was given by the accused towards any debt or liability. He would further submit that finding recorded by the first appellate Court that the cheque was not given towards liability is legal, justified, does not warrant interference by this Court and would pray for dismissal of the appeal. 9. I have heard learned counsel for the parties and perused the record. 10. Considering the rival submissions of the parties, the point emerged 7 for determination by this Court is: “Whether the impugned order of acquittal passed by the appellate Court vide order dated 19.03.2024 is legal, justified and warrants interference by this Court?” 11. To appreciate this point framed by this Court, it is expedient for this Court to go through the evidence brought on record. The complainant in the cross-examination has categorically admitted that he has purchased the said vehicle at Rs. 4,86,000/- which has been sold to the accused at Rs. 5,86,000/- and also stated that after expenditure incurred in documentation with regard to the vehicle and other expenses, amount of Rs. 1,60,000/- is payable to him. He has also admitted that the person who purchased the vehicle has to borne the expenditure incurred in Regional Transport Office and also admitted that when the vehicle is sold twice then only charges for change of owner of the vehicle is to be paid and no other expenditure is payable. He has also admitted that in business the profit is given to the purchaser and commission is payable to agent. He has also admitted that he has not detailed the expenditure incurred towards RTO or in other heads. He has also admitted that at the time of bidding, margin money of Rs. 50,000/- was given by him and also admitted that subsequently accused has also deposited Rs. 50,000/- towards margin money and sale consideration of the vehicle Rs. 4,86,000/-. He has voluntarily stated that accused has given Rs. 50,000/- towards security, but he has not submitted any document. He has also admitted that Mahindra and Mahindra Company has received Rs. 4,86,000/- towards the purchase of vehicle and Rs. 50,000/- 8 from the account of accused which has already been informed by the Finance Company to him, but denied that he has misused the cheque with Navin Motwani. 12. From the bare perusal of the evidence, it is quite vivid that the complainant has not produced any document towards debt or liability for which the accused has given cheque. On the contrary he has admitted that whatever the sale consideration and margin money was given has already been credited in the account of Finance Company, as such, the complainant miserably failed to demonstrate that the said cheque was given towards any debt or liability which is essential for the complainant to prove the presumption as required under Section 139 of the N.I. Act, 1881. It is well settled position of law that the initial burden lies upon the complainant then only the rebuttal is required to be done by the accused. The Hon’ble Supreme Court in case of Rajesh Jain vs. Ajay Singh reported in 2023 (10) SCC 148 has considered the ingredients of the offence enumerated in Section 138 of N.I. Act, 1881 and on its fulfillment, the offence under Section 138 of N.I. Act, 1881 will be attracted if the accused is unable to rebut the statutory presumption contemplated by Section 139 of the N.I. Act, 1881. The Hon’ble Supreme Court in paragraphs 26 to 28 has held as under: “26. In Gimpex Private Limited vs. Manoj Goel, this Court has unpacked the ingredients forming the basis of the offence under Section 138 of the NI Act in the following structure: (1) The drawing of a cheque by person on do account maintained by him with the banker for the payment of any amount of money to another from that account; 9 (i) The cheque being drawn for the discharge in whole or in part of any debt or other liability; (iii) Presentation of the cheque to the bank arranged to be paid from that account, (iv) The return of the cheque by the drawee bank as unpaid either because the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount (v) A notice by the payee or the holder in due course making a demand for the payment of the amount to the drawer of the cheque within 30 days of the receipt of information from the bank in regard to the return of the cheque; and (vi) The drawer of the cheque failing to make payment of the amount of money to the payee or the holder in due course within 15 days of the receipt of the notice. 27. In K. Bhaskaran v. Sankaran Vaidhyan Balan8 this Court had summarised the constituent elements of the offence in fairly similar terms by holding: “14. The offence Under Section 138 of the Act can be completed only with the concatenation of a number of acts. The following are the acts which are components of the said offence: (1) drawing of the cheque, (2) presentation of the cheque to the bank, (3) returning the cheque unpaid by the drawee bank, (4) giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, (3) failure of the drawer to make payment within 15 days of the receipt of the notice.” 28. The five (5) acts as set out in K Bhaskaran’s case (supra) are, generally speaking, matters of record and would be available in the form of documentary evidence as early as, at the stage of filing the complaint and initiating prosecution. Apart from the above acts, it is also to be proved that cheque was issued in discharge of a debt or liability (Ingredient no. (ii) in Gimpex’s case). The burden of proving this fact, like the other facts, would have ordinarily fallen upon the complainant. However, through the introduction of a presumptive device in Section 139 of the NI Act, the Parliament has sought to overcome the general norm as stated in Section 102 of the Evidence Act and has, thereby fixed the onus of proving the same on the accused. Section 139, in that sense, is an example of a reverse onus clause and requires the accused to prove the non-existence of the presumed fact, i.e., that cheque was not issued in discharge of a debt/liability.” 13. Again the Hon’ble Supreme Court in case of N. Vijay Kumar vs. Vishwanath Rao N. reported in 2025 SCC Online 873 has held in 10 paragraphs 11, 13 and 14 which reads as under: