09.06.2025 1. Devnath Thakur S/o Late Sukhlal Thakur Aged About 55 Years R/o. Limaudih v. 1. Mukesh Gavde S/o
Case Details
1 2025:CGHC:22593 AFR HIGH COURT OF CHHATTISGARH AT BILASPUR ACQA No. 808 of 2024 Judgment Reserved on : 13.02.2025 Judgment Delivered on : 09.06.2025 1. Devnath Thakur S/o Late Sukhlal Thakur Aged About 55 Years R/o. Limaudih, Tehsil Daundi, Present R/o. Balod District Balod (C.G.) ... Appellant versus 1. Mukesh Gavde S/o Shri Siyaram Gavde Aged About 43 Years R/o. Parrekodo, P.S. Bhanupratappur, Tehsil Durgkondal, Dist. Kanker (C.G.) ... Respondent For Appellant : Ms. Sweksha Sharma, Advocate For Respondent : Mr. B.P. Singh, Advocate 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 21.05.2024 (Annexure A/1) passed by the learned Chief Judicial Magistrate Balod, District - Balod (C.G.) in Criminal Case No. 233/2019 by which the learned Magistrate has dismissed the complaint filed under Section 138 of Negotiable Instruments Act, 1881 (in short “N.I. Act, 1881”) and acquitted the accused. MANISH YADAV Digitally signed by MANISH YADAV Date: 2025.06.09 16:40:39 +0530 2 2.
Facts
Brief facts of the case are that: (a) It is the case of the complainant that the accused and complainant are known to each other and because of good relationship, the accused has taken a loan of Rs. 2,48,000/- from the appellant on 26.12.2017 for his domestic necessity. It is also the case of the complainant that to discharge his debt and liability the accused has given a cheque bearing No. 105258 dated 02.02.2019 drawn at State Bank of India, Branch Bhanupratappur for Rs. 2,48,000/-. (b) The said cheque was deposited in the account maintained by the complainant at State Bank of India, Branch Balod on 02.02.2019. The said cheque was returned on 02.02.2019 with endorsement “dishonored due to insufficient fund” vide memo dated 02.02.2019. Thereafter, the appellant had sent a legal notice to the accused on 14.02.2019, the said notice was received by the accused on 02.03.2019, but neither the amount was paid to the appellant nor the accused replied to the said notice which has necessitated the complainant to file a complaint case under Section 138 of N.I. Act, 1881 against the accused before the learned Judicial Magistrate First Class Balod, District - Balod (C.G.). 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 in the complaint and has exhibited documents i.e. Cheque bearing No. 105258 dated 02.02.2019 (Exhibit P/1), Cheque Return Memo dated 02.02.2019 3 (Exhibit P/2), Legal Notice (Exhibit P/3), Postal Receipt (Exhibit P/4), Information regarding postal delivery (Exhibit P/5) Postal Delivery Notice (Exhibit P/6) and Agreement (Exhibit P/7) in support of his complaint. The witness was cross-examined wherein he has admitted that no date was mentioned in the cheque, but the contents were written by the accused in the cheque. He has also admitted that after execution of agreement dated 26.12.2017 the same is in his possession and denied that only signature was taken and contents have not been mentioned. He has also stated that the date in the cheque has been mentioned as 02.02.2019 by the accused. He has also admitted that he has not produced any document to demonstrate from where he has given the cheque to the accused and also admitted that when he was given the cheque he was posted in the Police Department and was getting salary of Rs. 40,000/- per month. He has also denied that forged agreement has been produced. 4. The accused has not examined any witness, but he has examined under Section 313 of Cr.P.C. wherein he has denied the allegations and has taken plea of false implication on account of illegal demand. The learned trial Court vide impugned judgment has dismissed the complaint. The learned Trial Court while dismissing the complaint has recorded its finding that the independent witness of the agreement has not been examined and no bank statement or receipt of payment has been placed on record, as such, the complainant has failed to prove that the accused has given the cheque towards any debt or liability, 4 accordingly, it has dismissed the complaint. Being aggrieved with the judgment of acquittal passed by the learned trial court, the appellant has preferred this appeal. 5.
Legal Reasoning
“18. Applying the definition of the word “proved” in Section 3 of the Evidence Act to the provisions of Sections 118 and 139 of the Act, it becomes evident that in a trial under Section 138 of the Act a presumption will have to be made that every negotiable instrument was made or drawn for consideration and that it was executed for discharge of debt or liability once the execution of negotiable instrument is either proved or admitted. As soon as the complainant discharges the burden to prove that the instrument, say a note, was executed by the accused, the rules of presumptions under Sections 118 and 139 of the Act help him shift the burden on the accused. The presumptions will live, exist and survive and shall end only when the contrary is proved by the accused, that is, the cheque was not issued for consideration and in discharge of any debt or liability. A presumption is not in itself evidence, but only makes a prima facie case for a party for whose benefit it exists. 9 19. The use of the phrase “until the contrary is proved” in Section 118 of the Act and use of the words “unless the contrary is proved” in Section 139 of the Act read with definitions of “may presume” and “shall presume” as given in Section 4 of the Evidence Act, makes it at once clear that presumptions to be raised under both the provisions are rebuttable. When a presumption is rebuttable, it only points out that the party on whom lies the duty of going forward with evidence, on the fact presumed and when that party has produced evidence fairly and reasonably tending to show that the real fact is not as presumed, the purpose of the presumption is over. 20. …The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the court need not insist in every case that the accused should disprove the non- existence of consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that bare denial of the passing of the consideration and existence of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumptions, the accused should bring on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non- existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist.” 12. Considering the fact, law on subject and the evidence of the parties, it is quite vivid that the complainant has proved that cheque was given towards debt or liability, therefore, order of the learned trial Court dismissing the complaint suffers from perversity, illegality and non-application of mind which warrants interference
Arguments
Learned counsel for the appellant would submit that the learned trial court has failed to appreciate the evidence available on record and wrongly acquitted the accused. She would further submit that learned trial court has committed material irregularities by acquitting the accused. She would further submit that learned trial court has failed to see that the accused has taken loan of Rs. 2,48,000/- from the appellant and for the payment of loan amount he has given this cheque to the appellant and also executed an agreement wherein he has not denied the signature, but the learned trial Court due to non-examination of the witness of the agreement has disbelieved it, which is nothing but an illegality therefore, impugned order deserves to be set aside and would pray for allowing the appeal. 6. 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 cheque was presented on 02.02.2019 and same was dishonored on 02.02.2019 and no notice was served upon the accused which is essential requirement to attract the provisions of Section 138 of N.I. Act, 1881. He would further submit that the finding recorded by the learned trial Court that the complainant has failed to prove that he has given money to the accused does not suffer from perversity or 5 illegality warranting interference by this Court and would pray for dismissal of the appeal. 7. I have heard learned counsel for the parties and perused the record. 8. Considering the rival submissions of the parties, the point emerged for determination by this Court is: “Whether the impugned order of dismissal of the complaint dated 21.05.2024 is legal, justified and warrants interference by this Court?” 9. 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 his evidence has clearly stated that an agreement dated 26.12.2017 (Exhibit P/7) was executed regarding repayment of amount upto 26.04.2018 and if the said cheque is dishonored then the complainant is free to take legal recourse and in that agreement the accused has put his signature which has not been denied by the accused and even there is no cross-examination on the issue of putting signature whether it has been executed forcefully or by adopting a coercive method. In absence of any evidence to demolish the execution of the agreement by free will of the accused, it is presumed that the accused has voluntarily executed the agreement (Exhibit P/7). The further finding of the trial Court that the witness of the agreement has not been examined before the trial Court, as such, it has recorded its finding that no agreement was executed, is also illegal and perverse finding and as per Section 139 of N.I. Act, 1881 the presumption 6 has to be drawn in favour of the holder of the cheque and unless and until it is rebutted, it cannot be held that the accused is able to rebut the presumption, thus, the trial Court has committed illegality in recording the finding of non-execution of agreement. 10. Finding of the learned trial Court that the complainant is unable to establish that he has given Rs. 2,48,000/- mentioned in the agreement (Exhibit P/7) as he has not submitted bank statement or receipt given by the accused is illegal and perverse as the accused has not denied the execution of agreement or has not led any evidence to substantiate that the said agreement has been executed by adopting coercive method, therefore, presumption should have been drawn in favour of complainant as per Section 139 of N.I. Act, 1881 as some material or any evidence to rebut the said presumption was placed on record by the accused. The learned trial Court has failed to recognize the common trend in the society that normally the persons if they are known to each other they do the money transaction between them on account of domestic necessity. In the present case also the complainant and the accused are known to each other which has not been denied by the accused. Even as per the agreement, the accused has agreed to pay the amount upto 26.04.2018 which clearly demonstrates that there was a debt against the accused, therefore, the finding recorded by the trial Court that the complainant has failed to establish that there was a debt or liability and he has given the money. Even the accused has not taken a plea that the cheque is misused by the complainant, as such, the 7 finding recorded by the leaned trial Court that the complainant has failed to prove that the cheque was given towards debt or liability is illegal and contrary to the law laid down by the Hon’ble Supreme Court in case of Sunil Todi and Others vs. State of Gujarat & Another reported in 2022 (16) SCC 762, wherein the Hon’ble Supreme Court in paragraphs 28 and 29 has held as under:- “25. The explanation to Section 138 of the NI Act provides that ‘debt or any other liability’ means a legally enforceable debt or other liability. The proviso to Section 138 stipulates that the cheque must be presented to the bank within a period of six months from the date on which it is drawn or within its period of validity. Therefore, a cheque given as a gift and not for the satisfaction of a debt or other liability, would not attract the penal consequences of the provision in the event of its being returned for insufficiency of funds. Aiyar’s Judicial Dictionary defines debt as follows: “Debt is a pecuniary liability. A sum payable or recoverable by action in respect of money demand.” Lindey L.J in Webb v. Strention defined debt as “… a sum of money which is now payable or will become payable in the future by reason of a present obligation, debitum in praesenti, solvendum in futuro.” The definition was adopted by this Court in Keshoram Industries v. CWT. Mookerjee J. writing for a Full Bench of the Calcutta High Court in Banchharam Majumdar v. Adyanath Bhattacharjee adopted the definition provided by the Supreme Court of California in People v. Arguello: “…‘Standing alone, the word ‘debt’ is as applicable to a sum of money which has been promised at a future day as to a sum now due and payable. If we wish to distinguish between the two, we say of the former that it is a debt owing, and of the latter that it is a debt due. In other words, debts are of two kinds: solvendum in praesenti and solvendum in futuro … A sum of money which is certainly and in all events payable is a debt, without regard to the fact whether it be payable now at a future time. A sum payable upon a contingency, however, is not a debt or does not become a debt until the contingency has happened.” 29. Thus, the term debt also includes a sum of money promised to be paid on a future day by reason of a present obligation. A post-dated cheque issued after the debt has been incurred would be covered by the definition of ‘debt’. However, if the sum payable depends on a contingent event, then it takes the color of a debt only after the contingency has occurred. Therefore, in the present case, a debt was incurred 8 after the second respondent began supply of power for which payment was not made because of the non-acceptance of the LCs’. The issue to be determined is whether Section 138 only covers a situation where there is an outstanding debt at the time of the drawing of the cheque or includes drawing of a cheque for a debt that is incurred before the cheque is encashed.” 11. The finding recorded by the learned trial Court that the complainant is unable to prove that he has not given the amount is contrary to the evidence and against the law laid down by the Hon’ble Supreme Court in case of Bansalingappa vs. Mudibasappa reported in 2019 (5) SCC 418 wherein the Hon’ble Supreme Court has considered the essential ingredients to prove the case by the complainant under Section 138 of N.I. Act, 1881 as per the provisions of Section 118 of N.I. Act, 1881 and 139 of N.I. Act, 1881 and has held in paragraph 19 as under:- “19. In Kumar Exports Vs. Sharma Carpets, (2009) 2 SCC 513, this Court again examined as to when complainant discharges the burden to prove that instrument was executed and when the burden shall be shifted. In paragraph Nos. 18 to 20, following has been laid down:-
Decision
by this Court. Accordingly, the impugned judgment is quashed and it is held that accused is liable for conviction for committing the offence under Section 138 of N.I. Act, 1881. But looking to the facts and circumstances of the case, the respondent/accused is 10 sentenced only to fine which is Rs. 25,000/- apart from cheque amount which is Rs. 2,48,000/- payable by the accused. The Rs. 25,000/- fine amount is payable to the complainant as compensation. The cheque amount and compensation shall be deposited in the trial Court by the accused within eight weeks from today, failing which the accused will undergo sentence of three months Simple Imprisonment. 13. Consequentially, the acquittal appeal is allowed. Sd/- (Narendra Kumar Vyas) Judge Manish