E-Shashi Kumar … v. 1.The State of Jharkhand 2.Vijay Singh
Case Details
IN THE HIGH COURT OF JHARKHAND AT RANCHI Cr. Revision No. 904 of 2018 E-Shashi Kumar …… Petitioner Versus 1.The State of Jharkhand 2.Vijay Singh ------- ……. Opp. Parties CORAM: HON’BLE MR. JUSTICE SANJAY PRASAD -------- For the Petitioner For the State For the O.P. No.2 : Mr. Deepankar, Advocate : Mr. Subodh Kumar Dubey, APP : Mr. Girish Mohan Singh, Advocate ----------- Judgment 8/Dated:10th April, 2024 This Criminal Revision Application has been filed on behalf of the complainant-petitioner challenging the judgment dated 08.05.2018 passed in Criminal Appeal No.64 of 2018 by the learned Sessions Judge, East Singhbhum at Jamshedpur by which the appeal preferred on behalf of the appellant-O.P.No.2 has been allowed by setting aside the judgment of conviction and order of sentence dated 27.02.2018 passed by Ms. Rupa Bandana Kiro, learned Judicial Magistrate, Ist Class, Jamshedpur in C/1 Case No.3079 of 2013 (T.R.No.17 of 2018) by which the learned Judicial Magistrate had convicted the O.P. No.2 for the offence under Section 138 of the N.I. Act and sentenced him to undergo S.I for 30 days and pay the fine of Rs.14,05,000/-. 2. The complainant‟s case, in brief, is that the accused-O.P. No.2 had demanded Rs.20,00,000/- from the complainant and on 04.04.2013 the accused had taken Rs.10,00,000/- as friendly loan from the complainant for development of business of his firm namely M/s Magadh Enterprises with assurance that the same will 1 be repaid within one month. It is further case of the complainant that after several demands, the accused as a proprietor of Magadh Enterprises issued a postdated cheque bearing no.057845 of Rs.10,00,000/- (Rs.Ten lakhs) dated 28.06.2013 of Bank of India in favour of the complainant and assured him that the same will be honoured by his Bank after its presentation. However, in the month of June 2013 when the complainant presented the said cheque in his account of S.B.I, Golmuri Branch then the same was dishonoured due to „insufficient fund‟ and the same was informed through cheque return memo dated 04.07.2013 then the complainant immediately informed the accused-O.P. No.2 about dishonour of cheque but the accused advised the complainant for again presentation of cheque after fifteen days. It is further case of the complainant that the complainant again presented the cheque after fifteen days but again the aforesaid cheque became dishonor due to „insufficient fund‟ and the same was informed to the complainant through cheque return memo dated 22.07.2013 and again the complainant informed to the accused regarding dishonor of cheque and the accused failed to make payment of the cheque amount. Thereafter the complainant sent a legal notice dated 17.08.2013 through registered post and the same was received by the accused (i.e. O.P. No.2) on 19.08.2013 but the accused (i.e. O.P.No.2) neither paid the cheque amount nor gave reply of legal notice. Hence, the complainant lodged this complaint case for the offence under Section 138 of N.I. Act against the accused. 3. Heard Mr. Deepankar, learned counsel for the petitioner, Mr. Subodh Kumar Dubey, learned APP for the State and Mr. Girish Mohan Singh, learned counsel for the O.P. No.2. 4. It is submitted that the impugned judgment dated 08.05.2018 passed by the learned Appellate Court in Cr. Appeal No.64 of 2018 2 is illegal, arbitrary and not sustainable in the eye of law. It is submitted that the learned Court below has wrongly set aside the judgment of conviction and order of sentence dated 27.02.2018 passed by the learned Judicial Magistrate, Ist Class Jamshedpur in C/1 Case No.3079 of 2013 (T.R.No.17 of 2018) by which the O.P. No.2 had been sentenced to undergo S.I for 30 days and pay the fine of Rs.14,05,000/-. It is submitted that the learned Appellate Court has failed to consider that the O.P. No.2 is legally liable to pay the debt to the petitioner. It is submitted that the learned Appellate Court has failed to consider the presumption of Section 139 of N.I. Act. It is settled principle of law that the burden to rebut the presumption under Section 139 of N.I. Act is on accused, “the burden on the accused to rebut the presumption is only to the extent of preponderance of the probability” whereas the complainant has to prove its case beyond all reasonable doubt. It has also been submitted that the accused can rely on the evidence brought on record by the complainant to rebut the presumption and it is not necessary that he has to lead separate and direct evidence, however, in the present case the accused respondent has not been able to rebut the presumption of the cheque having been issued for consideration of amount reflected in cheque. It is submitted that the Appellate Court has given wrong finding in respect of I.T. Return. The learned Appellate Court below has committed error by observing that as the amount in loan disbursed was not shown in I.T. Return, the appellant could not be said to have proved its case beyond reasonable doubt is also erroneous. It is submitted that the learned Appellate Court has given wrong finding for not impleading the company as an accused in view of the fact
Legal Reasoning
that the M/s Magadh Enterprises is a proprietorship firm and accused has issued the cheque as a proprietor of the company who 3 was looking day today affair of the company and he is the responsible person of the company who had issued cheque on behalf of the company against the friendly loan and hence it is not necessary to make the company as an accused. It is submitted that the learned Appellate court has failed to appreciate the fact that the petitioner had given friendly loan to the accused-O.P. No.2 and the O.P.No.2 being the sole proprietor had issued a cheque in favour of the petitioner. Thus, there is no necessity to make the company as an accused. It is submitted that the learned Appellate Court has failed to consider the finding of the Hon‟ble Supreme Court in Ghurey Lal vs. State of U.P (2008 (10) SCC 450, in which it has been observed that the Appellate Court may only overrule or otherwise disturb the trial court‟s finding if it has very substantial and compelling reasons for doing so. 5. Learned counsel for the petitioner in support of his contention has placed reliance upon the judgment passed in the
Legal Reasoning
case of Shri Deelip Apte vs. Nilesh P. Salgaonkar and another in Criminal Revision Application No.15 of 2006 with Criminal Appeal No.60 of 2005 on 06.07.2006. 6. On the other hand, learned counsel for the State has submitted that the judgment passed by the learned Court below is fit and proper and as such no interference is required. It is submitted that the learned Appellate Court has correctly appreciated the evidence and has reversed the judgment and sentence passed by the learned trial court below. It is submitted that the petitioner has not impleaded the proprietor of the firm as party in this case. Hence the Appellate Court has rightly allowed the appeal. 4 7. On the other hand, learned counsel for the O.P. No.2, after adopting the submission of learned APP has further submitted that this Criminal Revision Application is devoid of merit. It is submitted that no illegality has been committed by the learned Court below by passing the impugned judgment while reversing the judgment of conviction and sentence dated 27.02.2018 passed by the Judicial Magistrate, Ist Class, Jamshedpur. It is submitted that the complainant has failed to prove its case in absence of proprietor of Magadh Firm as a party. 8. Learned counsel for the O.P. No.2 has placed reliance upon the following judgments reported in:- (i) AIR 2012 SC 2795 (Aneeta Hada vs. M/s Godfather Travels and Tours Pvt. Ltd.), (ii) (2015) 15 SCC 768 (Charanjit Pal Jindal vs. L.N. Metalics, (iii) (2019) 3 SCC 797 (Himanshu vs. B. Shivamurthy and Another) and (iv) (2022) 6 SCC 735 (Tedhi Singh vs. Narayan Dass Mahant) 9. Perused the Lower Court Records and considered the submissions on behalf of both the parties. 10. It transpires that the complainant-petitioner had filed complaint case C/1 Case No.3079 of 2013 on 18.09.2013 under Section 138 of the N.I. Act stating therein that the accused-O.P. No.2 had taken friendly loan of Rs.20,00,000/- (Rs. Twenty lakhs) on 04.04.2013 from him for development of his business and had assured him to return the same within one month. However, after several demands made by him, the accused-O.P. No.2 being proprietor of Magadh Enterprises had issued postdated Cheque no. 57845 dated 28.06.2013 of an amount of Rs.10,00,000/- (Rs. Ten Lakhs) of Bank of India, Jamshedpur in his favour for realisation 5 of loan amount and when the same was presented on last week of June, 2013 then he received cheque returned memo dated 04.07.2013 by which it was informed that the cheque had been dishonourned due to „insufficient fund‟. Thereafter the complainant-petitioner on advice of accused-O.P. No.2 again presented the cheque after 15 days but again it was dishonoured and returned vide memo dated 22.07.2013 due to „insufficient fund‟. Then legal notice was sent to the O.P. No.2 on 17.08.2013 and the same was received by O.P. No.2 on 19.08.2013 but no payment was made. 11. It further appears that examination in-chief of the complainant was filed on an affidavit on 07.10.2013 and the case was fixed for his cross-examination and for enquiry evidence on several dates and on 11.07.2014 the complainant filed photo copy of certain documents and the case was fixed for passing order on the point of cognizance. Thereafter vide order dated 05.08.2014 the learned Judicial Magistrate, Ist Class had taken cognizance against the accused-O.P. No.2 under Section 138 of the N.I. Act on the basis of affidavit of complainant, instead of examining him on Solemn Affirmation (i.e. S.A) and issued summons against the accused-O.P. No.2. 12. It transpires that the accused-O.P. No.2 had surrendered before the learned Court below on 27.10.2015 and he was released on bail on 27.10.2015 itself. 13. Substance of accusation was explained to the accused-O.P. No.2 on 30.03.2016 under Section 138 of the N.I. Act and to which he claimed not guilty and claimed to be tried. 14. During trial the complainant had got examined one witness, who is as follows: (i) C.W-1 is E. Shashi Kumar (i.e. the complainant himself) 6 15. The complainant in support of his case had got marked the following documents as exhibits which were as follows:- (i) Ext-1 is the original cheque no.057845 dated 28.06.2013 of Bank of India (with objection), (ii) Ext-2 is the Cheque return memo dated 04.07.2013, (iii) Ext-3 is the cheque return memo dated 22.07.2013, (iv) Ext-4 is the Carbon copy of legal notice dated 17.08.2013, (v) Ext-5 is the postal receipt and (vi) Ext-6 the Acknowledgement is received notice dated 19.08.2013 (with objection). 16. The O.P. No.2 has got examined two (02) witnesses in support of his case who are as follows:- (i) D.W-1 is Jaganath Sandil and (ii) D.W-2 is Vinay Kumar Pankaj i.e. son of O.P. No.2. 17. Thereafter the accused-O.P. No.2 was examined under Section 313 Cr.P.C on 01.05.2017 to which he denied the circumstances put forth before him. 18. The defence in support of his case has got marked the following documents as the exhibits which are as follows:- Ext-A is legal notice upon admission of complainant, (i) (ii) Ext-B is Certificate issued by the BOI regarding issuance of cheque in the M/s Magadh Enterprises, Proprietor Vijay Kumar Singh, (iii) Ext-C to C/2 are signature of accused, witness and one Prakash Manjhi on the letter pad dated 19.08.2008 of M/s Magadh Enterprises and (iv) Ext-D is Bank A/c statement of accused showing payment to complainant 19. Thereafter the learned court below had convicted the O.P. No.2 for the offence under Section 138 of the N.I. Act and sentenced him to undergo S.I for 30 day and pay fine of Rs.14,05,000/-. 20. Thereafter the O.P. No.2 filed Cr. Appeal No.64/2018 before the learned Sessions Judge, East Singhbhum, Jamshedpur and 7 which was allowed vide judgment dated 08.05.2018 passed by the learned Sessions Judge and hence the present Criminal Revision has been filed on behalf of the complainant-petitioner. Hence appreciation of evidence is necessary. 21. C.W-1 is the complainant himself (i.e. E-Shashi Kumar), who has filed evidence on affidavit stating therein that the accused had taken friendly loan of an amount of Rs.20,00,000/- (Rs.Twenty Lakhs) on 16.04.2013 and assured to return within one month. Thereafter on several demands the accused-O.P. No.2 being proprietor of Magadh Enterprises had issued postdated Cheque no.57845 dated 28.06.2013 of Rs.10,00,000 of Bank of India. However, when he deposited the cheque in his account then he received cheque return memo dated 04.07.2013 by which the cheque was returned due to insufficient fund. He has proved the cheque as Exhibit-1 (with objection) and bank return memo as Exhibit-2. Thereafter on advice of accused he again presented cheque in his account after 15 days but it was dishonoured and he had received cheque return memo dated 22.07.2013 marked as Exhibit-3. Thereafter he had sent legal notice to the accused-O.P. No.2 through his counsel Sri S.S Dubey on 17.08.2013 and he has proved the legal notice and postal receipt marked as Exhibit-4 and Exhiit-5. The accused received the notice on 19.08.2013 and he has proved the acknowledgement marked as Exhibit-6 (with objection). However, the accused had not handed over any amount. 22. During cross-examination, he stated that he has passed Matric and has put his signature on reading the affidavit but he has not mentioned his age and business. He is doing transport business and transport firm is named as “B.M. Transport” which plies in Telco Sector and there is no commercial vehicle in his name personally. However, he is earning Rs.3,000-4000/- per day. He 8 admitted that he has not filed any documentary evidence in the Court to show payment of Rs.20,00,000/- (Rs.Twenty Lakhs) to the accused-O.P. No.2 (i.e. Vijay Singh) and no paper work was prepared for transaction of the said amount neither at his residence nor in the office. He admitted to have mentioned in para-3 of the complaint that the accused had taken friendly loan of Rs.10,00,000/- from him on 04.04.2013. He also admitted to have filed Complaint Case No.3082 of 2013 against Vijay Singh and it was mentioned that Rs.10,00,000/- was paid to Vijay Singh on 16.04.2013. However, he had not filed any paper in the Court for transaction taking place on 04.04.2013 and 16.04.2013. He had managed Rs.20,00,000/- (Rs.Twenty Lakhs) from himself and with the help of some other persons on 16.04.2013 and on that day his personal income was around Rs.10-12 lakhs and remaining he had taken Rs.8 lakhs-10 lakhs from Gurmint Singh and Manoj Kumar Das but he had not prepared any paper for taking the said amount from them. He asserted that he had taken Rs.6,00,000/- from Gurmit and Rs.4,00,000/- from Manoj Kumar and he had himself with Rs.10 lakhs-12 lakhs on 16.04.2013. 23. He further admitted that he has no documentary paper that he had given Rs.10,00,000/- out of Rs.20,00,000/- to the accused-O.P. No.2. He had also not made Magadh Enterprises as a party in this case. He has also not mentioned giving amount of Rs.20,00,000/- in his Income Tax Return and he had also given his evidence in C-1-3082/2013 on 07.06.2016 but only Gurmit can say as to when he had obtained Rs.6,00,000/-. He had also returned Rs.6,00,000/- to Gurmit and Rs.4,00,000/- to Manoj Kumar but no documentary paper was prepared because there was trading transactions among themselves. He also admitted that the O.P. No.2-Vijay Singh is his friend but he had not taken any amount as loan from him. He also 9 could not explain as to when he had handed over any amount to Vijay Singh-O.P. No.2 prior to 2013. 24. He admitted for receiving of cheque dated 06.02.2006 vide Cheque no.832724 of Rs.1,60,000/-, Cheque no.13092 dated 08.06.2006 of Rs.25,000/-, Cheque no.13093 dated 06.07.2006 of Rs.25,000/-, Cheque no.17612 dated 06.07.2006 of Rs.25,000/- and Cheque no.17611 dated 06.07.2006 of Rs.25,000/-, Cheque no.17632 dated 02.09.2006 of Rs.30,000/- and Cheque no.17631 of Rs.30,000/-, Cheque no.05382 dated 15.12.2006 of Rs.10,000/-, Cheque no.5385 dated 18.12.2006 of Rs.30,000/-, Cheque no.63580 dated 07.01.2011 of Rs.1,00,000/-, Cheque no.188 dated 06.09.2012 of Rs.60,000/- and Cheque no.187 dated 25.08.2012 of Rs.50,000/- and Cheque no.049057 dated 27.04.2011 of Rs.1,00,000/- respectively. 25. During his further cross-examination, he admitted that when cheque was handed over to him then date, name of the complainant and amount was filled but said details were not filled during his presence. He admitted for filing list of documents on 11.07.2014 on his instruction along with photo copy of legal notice. However, in that photo copy neither his signature nor the signature of his learned counsel is there and even the date is not mentioned. Document marked as Exhibit-A was admitted as Exhibit on admission but later on it was objected by the counsel for the complainant. He further admitted that he had taken Rs.6,60,000/- (Rs.Six Lakhs Sixty Thousand) from the accused-O.P. No.2 as it was an arrears of amount prior to this occurrence as the said amount was due. However, he could not remember as to when he had given the money/amount to Vijay Singh-O.P. No.2 and in lieu of which he had returned him Rs.6,60,000/-. He also cannot file 10 any document in the Court to show giving said amount of Rs.6,60,000/- and he has no document to show the transaction of the same. 26. He further admitted in paragraphs 34 and 35 that he had taken Poklen Machine on loan in the year 2004 from ICICI Bank. On being shown, on the attention of photographes of three Poklen Machine, the witness refused to identify the photo copy of the Poklen Machine and said three photographs were marked for identification and were kept on the record. He admitted that Poklen Machine was financed through the ICICI Bank and due to non-payment of the installment, he had handed over the said machine to the Bank. He also admitted for giving said Poklen Machine on rent to Vijay Kumar Singh-O.P. No.2 and the said Machine was being run by his own Supervisor and one Driver. The name of Supervisor is Prakash Manjhi but he does not remember the name of the driver. The rent of said Poklen Machine was around Rs.1300- 1400 per hour and this event took place between the year 2004-06 but Vijay Singh had not given the full rent due to him. He denied the suggestion for taking blank cheques from Vijay Singh-O.P. No.2 which was signed by Vijay Singh and details were not filed. He further admitted that he had not demanded the rent in writing from Vijay Singh and no written paper was prepared for handing over Poklen Machine on rent. He had denied the suggestion that the cheque given as security in the year 2006 has been misused in the year 2013. He admitted that he had no receiving for giving Rs.10,00,000/- in cash on 04.04.2013. 27. Thus, from scrutinizing the evidence of C.W-1, it is evident that his evidence is full of contradictions and false statements. On the one hand he himself admitted that he had not done any business 11 with the O.P. No.2 but on the other hand when he was confronted of transactions of various amounts by different cheques with the O.P. No.2, he showed his ignorance, which shows that the witness is not truthful. He further stated for having taken Rs.4,00,000/- cash from Manoj Kumar Das and Rs.6,00,000/- from Gurmit Singh has been wrongly found untrue by the learned Court below and this Court also finds that the view of learned Appellate Court is correct that no person would take Rs.10,00,000/- himself as a loan for giving loan to another person and he has also falsified from his own statements. 28. So far as defence evidence is concerned, D.W-1 is Jaganath Sandil, who is Manager of Bank of India and stated during his evidence that he had been authorized by Telco Branch Manager for giving evidence vide letter dated 19.09.2017 issued by Chief Manager, Bank of India. The authorization letter has been marked as Exhibit-B. He further proved the certificate dated 19.09.2017 prepared by Anil Kumar, Chief Manager, Bank of India and it was typed by Senior Manager, Ramesh Sharma. He identified the signature of Chief Manager as Exhibit-F. He further stated that Cheque no.057834 comes in the bundle of cheques dated 09.06.2008. 29. During cross-examination, he stated to have not seen the Register by which the accused-petitioner had been issued Cheque no.578012 and Cheque no.57850. However, cheque issued in the year 2008 can be used by the customer in the year 2012 or any year. He denied the suggestion that a Bank can use the cheque later on if issued in the year 2008. Thus, D.W-1 is a formal witness and he has merely proved Exhibit-E and Exhibit-F as mentioned above but he is interested witness on the point of issuance of cheque. 12 30. D.W-2 is Vinay Kumar Pankaj, who is son of O.P. No.2 and stated during his evidence, on an affidavit stating therein that his father had taken Poklen Machine on rent from E-Shashi Kumar @ Rs.450/- per hour. His father issued two cheques bearing Cheque No. 057834 and Cheque no.057845 vide dated 19.08.2008 to one Prakash Manjhi, the staff of E-Shashi Kumar (i.e. the petitioner). He proved the signature of Vijay Kumar Singh i.e. O.P. No.2 received by Prakash Manjhi (i.e. Exhibit-C, C/1 and C/2 with objection). His father is sole proprietor of Magadh Enterprises. On being shown original cheque, he admitted that his father had given cheque to the petitioner-complainant. He also admitted that Exhibit-6 does not contain the signature of the complainant. On being shown Exhibit-5, the witness stated that date is not mentioned as it may be 14 or 19. He is doing business since 2007. Any Bank transaction made with the complainant was made prior to the institution of case in the year 2013. 31. He showed ignorance that the complainant had given certain amount to his father in the year 2013. He admitted, for not having filed any document to show that Prakash Manjhi was working with the complainant. On being shown Exhibit-6, he stated for not written that Prakash Manjhi is receiving cheque on behalf of the complainant. Receiving receipt of Exhibit-6 is prepared and written by his father. (He further stated that his father had paid entire payment to E-Shashi Kumar towards rent of Poklen Manchine but the petitioner had not returned the cheques by stating that cheques have lost somewhere.) 32. During further cross-examination, he admitted that he could not brought Prakash Manjhi in the Court. He denied the suggestion of creating forged paper to escape from liability. His father had not written or complained anywhere regarding misuse of cheque. He 13 admitted in Para-12 that his father has written in the Bank that cheque was given as security and has not been returned and he got payment stopped from the Bank. 33. Thus, from scrutinizing the evidence of D.W-2, it is evident that he is son of O.P. No.2 and has supported the case by stating that two security cheques bearing Cheque No. 057834 and Cheque no.057845 were received by one Prakash Manjhi, who was the staff of E-Shashi Kumar (i.e. the petitioner). 34. From perusal of Exhibit-C, Exhibit-C/1 and Exhibit-C/2 respectively, it would appear that Vijay Kumar Singh had issued letter dated 19.08.2008 and showing receiving of two cheques being Cheque No.057834 and 057845 by Prakash Manjhi on 19.08.2008 in presence of witness Vinay Kumar Pankaj i.e. D.W-2. Though the complainant has tried to dispute the receiving letter dated 19.08.2008 but it was not sent to any Forensic Expert even by the learned Court below. 35. So far as documentary evidence is concerned, Exhibit-A is letter dated 19.09.2017 issued by Chief Manager, Bank of India, Telco Branch informing the learned Judicial Magistrate for deputing one Officer Mr. Jagnath Sandil as a witness and Exhibit-B is the signature of Chief Manager. 36. Exhibit-A is signature of O.P. No.2-Vijay Kumar Singh on Carbon Copy of legal notice dated 17.08.2013. Exhibit-B is the certificate issued by Chief Manager, Band of India. Exhibit-C is signature of O.P. No.2 on letter paid dated 19.08.2008 whereas Exhibit-C/1 is signature of Prakash Manjhi on said letter pad dated 19.08.2008 and Exhibit-C/2 is signature of D.W-2-Vinay Kumar Pankaj on the said letter. Exhibit-D is the photo copies of statement of Bank Accounts showing transanction and payment made by the O.P. No.2 to the complainant from the 14 year 2006 to 2013 and 1st payment appears to have been on 06.02.2006 and last payment appears to have been made on 22.07.2013. Although last transaction is not readable as it is scanned copy but it was marked before the learned Court below whereas other transaction are legible to some extent and this has not been disputed by the complainant-petitioner before the learned Court below and hence there is evidence of payment made by the O.P. No.2 to the petitioner between 2006 to 2013 whereas the Bank statement has been filed from 31.05.2005 till 12.12.2012. 37. From perusal of the judgment passed by the learned Court below, it would appear that the learned Trial Court had convicted the O.P. No.2 on the ground that the O.P. No.2 had not denied his signature on the cheque. The Trial Court further held that the presumption is held in favour of the complainant for the holder in due course under Section 138 read with Section 118 of the N.I. Act. 38. However, the learned Appellate Court below had set aside the judgment of conviction and sentence on three grounds:- (i) That non-impleadment of the firm-M/s Magadh Enterprises amounts to non-compliance of the Section 141 of the N.I. Act and held that the sole proprietor was Managing Director who ought to have been arrayed as an accused. The cheque was not issued in the personal capacity by the accused rather the cheque was issued as the Proprietor of Magadh Enterprises. (ii) The learned Appellate Court below further observed that the date of lending of Rs.20,00,000/- (Rs.Twenty Lakhs) is not very certain and two dates i.e.04.04.2013 and 16.04.2013 have been brought on record and the complainant 15 had also admitted that he had just Rs.10 to 12 lakhs even on 16.04.2013 with him and had borrowed Rs.6,00,000/- from a business partner Gurmit Singh and Rs.4,00,000/- from Manoj Kumar Das and held that this circumstance goes against the complainant as to why a person will borrow Rs.10,00,000/- from some third person in order to give Rs.20,00,000/- to the accused-O.P. No.2. Thus, there is a preponderance of probabilities making the alleged loan transaction doubtful, even the complainant had not filed Income Tax Return to show that he had the capacity to give a friendly loan of Rs.20,00,000/- and also observed that the complainant was unable to pay EMI to its Financer due to financial crunch and he had to surrender the Poklen Machine back to the Financer. (iii) Two cheques including the cheque in question were given as security and non-examination of Prakash Manjhi who signed on Exhibit-C has not been examined on behalf of the complainant and Exhibit-C revealed that two cheques were given as security to the complainant by the O.P. No.2. 39. This Court finds that no illegality has been find by the learned Appellate Court below and the learned Appellate Court below has rightly observed that the Managing Director or the sole proprietor of M/s Magadh Enterprises has not been arrayed as a party in the accused and the complaint cannot succeed in absence of non-impleadment of Managing Director or sole proprietor of M/s Magadh Enterprises. 40. It is evident from the evidence of C.W-1-complainant that he has given false statement before the learned Court below earlier that he had not taken any amount from the O.P. No.2 and had also not taken any loan amount but when he was confronted on the 16 question of taking Rs.6,60,000/- (Rs.Six lakhs Sixty thousand) from the O.P. No.2 on any particular date then he could not explain the date and could not remember the date of taking such amount of Rs.6,60,000/-. Thus, the evidence of C.W-1-complainant is completely false, wrong and incorrect. He had also admitted for taking different amounts by way of business transaction from the O.P. No.2 from 06.02.2006 till 27.04.2011 as has been mentioned in the preceding paragraph no.24 and thus the complainant- petitioner has not come before this Court as also before the learned Court below with the clean hands. 41. It is further evident from the evidence of C.W-1 (i.e. the complainant) that it was a case of at best non-payment of due of arrears of rent with regard to hire of Poklen Machine but it was made a case of N.I. Act by the complainant-petitioner cunningly as he himself admitted in para nos.35 and 38 that the O.P. No.2-Vijay Singh had not made the entire payment and he also admitted for not demanding the rent of Vehicle in writing. He also admitted that no written document was prepared for taking Poklen Machine on hire. 42. It further transpires from the evidence of C.W-1 during cross- examination at para-35 that Prakash Manjhi was Supervisor of his company and the O.P. No.2 had taken the advance as per letter pad dated 19.08.2008 and for that he had handed over the Cheque Nos.057834 and 057845 to said Prakash manjhi who was Supervisor of E-Shashi Kumar and the signature of Prakash Manjhi, Vinay Kumar Pankaj (i.e. D.W-2) and Vijay Kumar Singh (i.e. O.P. No.2) on the letter pad of O.P. No.2, which were marked as Exhibit-C/1, C/2 and C/3 respectively on 19.08.2008 and the said cheques were given as security. 17 43. The evidence of D.W-2 cannot be discarded in view of the fact that he is son of O.P. No.2 and because he is a material witness his evidence is reliable on the point of handing over two Cheque Nos.057834 and 057845 to Prakash Manjhi on 19.08.2008 when the complainant himself admitted in para-35 that one Prakash Manjhi was the Supervisor of his company. 44. It further transpires that the complainant-petitioner and O.P. No.2 were on transaction for around five years on different dates and there were several transaction by cheques as well as some other transaction may be possible as has been mentioned earlier in the preceding paragraph of the judgment. Thus, it is a case of civil dispute, if any, has been converted into cheque bounce. It is evident that the complainant-petitioner wanted to blackmail the O.P. No.2 and hence he presented the Cheque no. 057845 which is subject matter of this case and had present another Cheque No.057834 which is the subject matter of another Cr.
Decision
Revision No.1034 of 2018 which is also being disposed of by this Court simultaneously today. 45. It further transpires from the evidence of D.W-1 that Cheque No.057834 comes in the bundle of cheques issued on 09.06.2008 and therefore, it is also apparent from conjoint reading of Exhibit- E, Exhibit-F, Exhibit-C, Exhibit-C/1 and Exhibit-C/2 and the evidence of C.W-1 at para-35 and evidence of D.W-2 that the cheque issued in the month of June, 2008, were handed over to the complainant-petitioner on 19.06.2008 as a security and which was misused by the complainant-petitioner in the year 2013 cunningly. Thus, the complaint case and his evidence are bundle of lies. 46. It has been held in the case of Aneeta Hada vs. M/s Godfather Travels and Tours Pvt. Ltd. reported in (2012) 5 SCC 661 at paragraph nos.59 and 64 as follows: 18 that for maintaining irresistible conclusion “Para-59:- In view of our aforesaid analysis, we arrive at the the prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative. The other categories of offenders can only be brought in the drag-net on the touchstone of vicarious liability as the same has been stipulated in the provision itself. We say so on the basis of the ratio laid down in C.V. Parekh [(1970) 3 SCC 491 : 1971 SCC (Cri) 97] which is a three-Judge Bench decision. Thus, the view expressed in Sheoratan Agarwal [(1984) 4 SCC 352 : 1984 SCC (Cri) 620] does not correctly lay down the law and, accordingly, is hereby overruled. The decision in Anil Hada [(2000) 1 SCC 1 : 2001 SCC (Cri) 174] is overruled with the qualifier as stated in para 51. The decision in Modi Distillery [(1987) 3 SCC 684 : 1987 SCC (Cri) 632] has to be treated to be restricted to its own facts as has been explained by us hereinabove. Para-64:- Keeping in view the anatomy of the aforesaid provision, our analysis pertaining to Section 141 of the Act would squarely apply to the 2000 enactment. Thus adjudged, the Director could not have been held liable for the offence under Section 85 of the 2000 Act. Resultantly, Criminal Appeal No. 1483 of 2009 is allowed and the proceeding against the appellant is quashed. As far as the Company is concerned, it was not arraigned as an accused. Ergo, the proceeding as initiated in the existing incarnation is not maintainable either against the company or against the Director. As a logical sequitur, the appeals are allowed and the proceedings initiated against Avnish Bajaj as well as the Company in the present form are quashed.” 47. It has been held in the case of Charanjit Pal Jindal vs. L.N. Metalics reported in (2015) 15 SCC 768 at paragraph nos.11 and 12 as follows:- “Para-11:- From the aforesaid finding, we find that after analysing all the provisions and having noticed the different decisions rendered by this Court, the three-Judge Bench arrived at the irresistible conclusion that for maintaining the prosecution under Section 141 of the Act, arraigning a company as an accused is imperative. Hence in this case, we find no reason to refer the matter to the larger Bench. 12. In the present case, only the appellant was impleaded as an accused. In that view of the matter, we are of the view that 19 complaint with respect to the offence under Section 138 read with Section 141 of the Act was not maintainable following the decision in Aneeta Hada [Aneeta Hada v. Godfather Travels & Tours (P) Ltd., (2012) 5 SCC 661 : (2012) 3 SCC (Civ) 350 : (2012) 3 SCC (Cri) 241] . We set aside the judgment dated 17-4-2010 passed by the trial court, the order dated 27-5-2011 passed by the appellate court and the impugned judgment dated 9-11-2012 passed by the High Court of Orissa, Cuttack in Charanjit Pal Jindal v. L.N. Metalics [Charanjit Pal Jindal v. L.N. Metalics, Criminal Revision No. 467 of 2011, decided on 9-11-2012 (Ori)] . The appellant stands acquitted.” 48. It has been held in the case of Himanshu vs. B. Shivamurthy and Another reported in (2019) 3 SCC 797 at paragraph nos.12 and 13 as follows:- “Para-12:- The provisions of Section 141 postulate that if the person committing an offence under Section 138 is a company, every person, who at the time when the offence was committed was in charge of or was responsible to the company for the conduct of the business of the company as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished. Para-13:- In the absence of the company being arraigned as an accused, a complaint against the appellant was therefore not maintainable. The appellant had signed the cheque as a Director of the company and for and on its behalf. Moreover, in the absence of a notice of demand being served on the company and without compliance with the proviso to Section 138, the High Court was in error in holding that the company could now be arraigned as an accused.” 49. It has been held in the case of Tedhi Singh vs. Narayan Dass Mahant reported in (2022) 6 SCC 735 at paragraph nos.3 and 8 as follows:- the “Para-3:- The learned counsel drew our attention to of Basalingappa versus Mudibasappa [Basalingappa v. M udibasappa, (2019) 5 SCC 418 : (2019) 2 SCC (Cri) 571]. judgment Court this in 20 This Court, inter alia, has held as follows : (SCC pp. 432- 33, para 25) “25. We having noticed the ratio laid down by this Court in the above cases on Sections 118(a) and 139, we now summarise the principles enumerated by this Court in the following manner: 25.1. Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability. 25.2. The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities. to raise a probable defence. 25.3. To rebut the presumption, it is open for the accused to rely on evidence led by him or the accused can also rely on the materials submitted by the complainant in Inference of order preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely. 25.5. It is not necessary for the accused to come in the witness box to support his defence.” Para-8:- It is true that this is a case under Section 138 of the Negotiable Instruments Act. Section 139 of the NI Act provides that court shall presume 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. This presumption, however, is expressly made subject to the position being proved to the contrary. In other words, it is open to the accused to establish that there is no consideration received. It is in the context of this provision that the theory of “probable defence” has grown. In an earlier judgment, in fact, which has to in Basalingappa [Basalingappa v. Mudibasappa, (2019) 5 SCC 418 : (2019) 2 SCC (Cri) 571] , this Court notes that Section 139 of the NI Act is an example of reverse onus (see Rangappa v. Sri Mohan [Rangappa v. Sri Mohan, (2010) 11 SCC 441 : (2010) 4 SCC (Civ) 477 : (2011) 1 SCC (Cri) 184] ). It is also true that this Court has found that the accused is not expected to discharge an unduly high standard of proof. It is accordingly that the principle adverted been also 21 has developed that all which the accused needs to establish is a probable defence. As to whether a probable defence has been established is a matter to be decided on the facts of each case on the conspectus of evidence and circumstances that exist.” 50. It has been held in the case of Basalingappa vs. Mudibasappa reported in (2019) 5 SCC 418 at paragraph nos. 13, 14, 16, 17, 22, 25, 25.05, 28 and 29 as follows:- “Para-13:- This Court in Bharat Barrel & Drum Mfg. Co. v. Amin Chand Payrelal [Bharat Barrel & Drum Mfg. Co. v. Amin Chand Payrelal, (1999) 3 SCC 35] had occasion to consider Section 118(a) of the Act. This Court held 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 and defendant can prove the non-existence of a consideration by raising a probable defence. In para 12, the following has been laid down: (SCC pp. 50-51) “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 his 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. The bare denial of the passing of the consideration apparently 22 does not appear to be any defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the plaintiff. To disprove the presumption, the defendant has to bring on record such facts and circumstances upon consideration of which the court may either believe that the consideration did not exist or its non-existence was so probable that a prudent man would, under the circumstances of the case, shall act upon the plea that it did not exist.” Para-14:- S.B. Sinha, J. in M.S. Narayana Menon v. State of Kerala [M.S. Narayana Menon v. State of Kerala, (2006) 6 SCC 39 : (2006) 3 SCC (Cri) 30] had considered Sections 118(a), 138 and 139 of the Act, 1881. It was held that presumptions both under Sections 118(a) and 139 are rebuttable in nature. Explaining the expressions “may presume” and “shall presume” referring to an earlier judgment, the following was held in para 28: (SCC p. 49) “28. What would be the effect of the expressions “may presume”, “shall presume” and “conclusive proof” has been considered by this Court in Union of India v. Pramod Gupta [Union of India v. Pramod Gupta, (2005) 12 SCC 1] , in the following terms: (SCC pp. 30-31, para 52) „52. … It is true that the legislature used two different phraseologies “shall be presumed” and “may be presumed” in Section 42 of the Punjab Land Revenue Act and furthermore although provided for the mode and manner of rebuttal of such presumption as regards the right to mines and minerals said to be vested in the Government vis-à-vis the absence thereof in relation to the lands presumed to be retained by the landowners but the same would not mean that the words “shall presume” would be conclusive. The meaning of the expressions “may presume” and “shall presume” have been explained in Section 4 of the Evidence Act, 1872, from a perusal whereof it would be evident that whenever it is directed that the court shall presume a fact it shall regard such fact as proved unless disproved. In terms of the said provision, thus, the expression “shall presume” cannot be held to be synonymous with “conclusive proof”.” Para-16:- This Court in M.S. Narayana Menon case [M.S. Narayana Menon v. State of Kerala, (2006) 6 SCC 39 : (2006) 3 SCC (Cri) 30] held that what is needed is to raise a probable defence, for which it is not necessary for the accused to disprove the existence of consideration by way of direct evidence and even the evidence adduced on behalf of the complainant can be relied upon. Dealing with standard of proof, the following was observed in para 32: (SCC p. 51) 23 “32. The standard of proof evidently is preponderance of 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.” Para-17:- In Krishna Janardhan Bhat v. Dattatraya G. Hegde [Krishna Janardhan Bhat v. Dattatraya G. Hegde, (2008) 4 SCC 54 : (2008) 2 SCC (Cri) 166] , this Court held that an accused for discharging the burden of proof placed upon him under a statute need not examine himself. He may discharge his burden on the basis of the materials already brought on record. The following was laid down in para 32: (SCC p. 62) “32. An accused for discharging the burden of proof placed upon him under a statute need not examine himself. He may discharge his burden on the basis of the materials already brought on record. An accused has a constitutional right to maintain silence. Standard of proof on the part of an accused and that of the prosecution in a criminal case is different.” further, this Court Para-22:- Elaborating in Rangappa case [Rangappa v. Sri Mohan, (2010) 11 SCC 441 : (2010) 4 SCC (Civ) 477 : (2011) 1 SCC (Cri) 184] held that Section 139 of the Act is an example of a reverse onus and the test of and guide proportionality interpretation of reverse onus clauses on the defendant-accused and the defendant-accused cannot be expected to discharge an unduly high standard of proof. In paras 27 and 28, the following was laid down: (Rangappa case [Rangappa v. Sri Mohan, (2010) 11 SCC 441 : (2010) 4 SCC (Civ) 477 : (2011) 1 SCC (Cri) 184] , SCC pp. 453-54) construction should the “27. 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 to the defendant-accused cannot be expected discharge an unduly high standard of proof. 24 28. 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.” the complaint filed by in examination-in-chief Para-25:- We having noticed the ratio laid down by this Court in the above cases on Sections 118(a) and 139, we now summarise the principles enumerated by this Court in following manner: Para-25.5:- It is not necessary for the accused to come in the witness box to support his defence. Para-28:- There is one more aspect of the matter which also needs the to be noticed. In the complainant as well as complainant has not mentioned as to on which date, the loan of Rs 6 lakhs was given to the accused. It was during cross- examination, he gave the date as November 2011. Under Section 118(b), a presumption shall be made as to date that every negotiable instrument was made or drawn on such date. Admittedly, the cheque is dated 27-2-2012, there is not even a suggestion by the complainant that a post-dated cheque was given to him in November 2011 bearing the date 27-2-2012. Giving of a cheque on 27-2-2012, which was deposited on 1-3-2012 is not compatible with the case of the complainant when we read the complaint submitted by the complainant especially para 1 of the complaint, which is extracted as below: long standing “1. The accused is a very good friend of the complainant. The accused requested the complainant a hand loan to meet out urgent and family necessary a sum of Rs 6,00,000 (Rupees Six lakhs) and on account of the difficulties, which is being faced by the accused the complainant agreed to lent hand loan to meet out the financial difficulties of the accused and accordingly the complainant lent hand loan Rs 6,00,000 (Rupees the Six friendship and knowing lakhs) dated 27-2-2012 favour of in 25 complainant stating that on its presentation it will be honoured. But to the surprise of the complainant on presentation of the same for collection through his bank the cheque was returned by the bank with an endorsement “Funds Insufficient” on 1-3-2012.” Para-29:- Thus, there is a contradiction in what was initially stated by the complainant in the complaint and in his examination-in-chief regarding date on which loan was given on one side and what was said in cross-examination in other side, which has not been satisfactorily explained. The High Court was unduly influenced by the fact that the accused did not reply to the notice denying the execution of cheque or legal liability. Even before the trial court, appellant-accused has not denied his signature on the cheque.” 51. It is further evident that there is no witness to show that the petitioner had given Rs.20,00,000/- (Rs.Twenty Lakhs) or Rs.10,00,000/- to the O.P. No.2 on 04.04.2013. By no stretch of imagination it can be stated that liability to repay unaccounted cash amount is a legally enforceable liability within the meaning of explanation to Section 138 of the said Act. The alleged debt cannot be said to be a legally recoverable debt. 52. It has been held in the judgment rendered in the case of Sanjay Mishra Versus Kanishka Kapoor @ Nikki reported in 2009 (0) Cr. L. J. 3777 by the Bombay High Court, at para- 11, 12, 13 and 15 as follows:- for that rebutting “Para-11:- The Apex Court also reiterated well established the presumption legal position under section 139 of the said Act, it is not necessary in every case for the accused to step into the witness box. The Apex Court held that the standard of proof on the part of the accused and that of prosecution in a criminal case is different. The prosecution has to prove the guilt of an accused beyond reasonable doubt, but the standard of proof so as to prove a defence is "preponderance of probability". Inference of preponderance of probabilities can be drawn 26 even by reference to circumstances. In paragraph 44 the Apex Court observed thus: ". The presumption of innocence is a human right (See Narendra Singh v. State of M.P., Ranjitsing Brahmajeetsing Sharma v. State of Maharashtra and Rajesh Ranjan Yadav v. CBI.) Rights Article 6(2) of the European Convention on Human provides: "Everyone charged with a criminal offence shall be presumed innocent until proved guilty according to law." Although India is not bound by the aforementioned Convention and as such it may not be necessary like the countries forming European countries to bring common law into land with the Convention, a balancing of the accused's rights and the interest of the society is required to be taken into consideration. In India, however, subject to the statutory interdicts, the said principle forms the basis of criminal jurisprudence. For the aforementioned purpose the offence, seriousness as also gravity thereof may be taken into consideration. The courts must be on guard to see that merely on the application of presumption as contemplated under section 139 of the Negotiable Instruments Act, the same may not lead to injustice or mistaken conviction. ..." (Emphasis added) In paragraph 45 the Apex Court held thus: the nature of "45.We are not oblivious of the fact that the said provision has been inserted to regulate the growing business, trade, commerce and industrial activities of the country and the strict liability to promote greater vigilance in financial matters and to safeguard the faith of the creditor in the drawer of the cheque which is essential to the economic life of a developing country like India. This, however, shall not mean that the courts shall put a blind eye to the ground realities. Statute mandates raising of presumption but it stops at that. It does not say how presumption drawn should be held to have rebutted. Other jurisprudence, namely, legal important principles of presumption of innocence as human rights and the doctrine of reverse burden introduced by section 139 should be delicately balanced. Such balancing acts, indisputably would largely depend upon the factual matrix of each case, the materials brought on record and having regard to legal principles governing the same." (Emphasis added) 27 The Apex Court held that presumption of innocence forms part of human rights and therefore the doctrine of reverse burden introduced by section 139 has to be delicately balanced. Para-12:- Now turning back to the facts of the present case, assuming that the presumption under section 139 of the said Act regarding existence of debt or liability is not rebutted, in order to attract section 138, the debt or liability has to be a "legally recoverable" debt or liability. As held by the Apex Court in the case of Krishna Bhat (supra) there is no presumption under section 139 of the said Act that the debt is a legally recoverable debt. In the case of Goa Plast (P) Ltd.Vs. Chico Ursula D'Souza [(2004) 2 Supreme Court Cases 235] the Apex Court reiterated that a debt or liability subject matter of section 138 means a legally enforceable debt or liability. Para-13:- In the present case, there is a categorical admission that the amount allegedly advanced by the applicant was entirely a cash amount and that the amount was "unaccounted". He admitted not only that the same was not disclosed in the Income Tax Return at the relevant time but till recording of evidence in the year it was not disclosed in the Income Tax Return. By no stretch of imagination it can be stated that liability to repay unaccounted cash amount is a legally enforceable liability within the meaning of explanation to section 138 of the said Act. The alleged debt cannot be said to be a legally recoverable debt. Para-15:- The Apex Court has held that the laws relating to the said Act are required to be interpreted in the light of the object intended to be achieved by it despite there being deviation from general law. The Apex Court expressed that the object of section 138 of the said Act was to ensure that commercial and mercantile activities are conducted in smooth and healthy manner. The explanation to section 138 of the said Act clearly provides that a debt or other liability referred to in section means a legally enforceable debt or other liability. The alleged liability to repay an unaccounted cash amount admittedly not disclosed in the Income Tax Return cannot be a legally recoverable liability. If such liability is held to be a legally recoverable debt, it will render the explanation to section 138 of the 28 said Act nugatory. It will defeat the very object of section 138 of the Act of ensuring that the commercial and mercantile activities are conducted in a healthy manner. The provision of section amount. A cheque 138 cannot be resorted to for recovery of an unaccounted issued in discharge of alleged liability of repaying "unaccounted" cash amount cannot be said to be a cheque issued in discharge of a legally enforceable debt or liability within the meaning of explanation of section 138 of the said Act. Such an effort to misuse the provision of section 138 of the said Act has to be discouraged.” 53. It has been held in the judgment rendered by the Hon‟ble Supreme Court in the case of Krishna Janardhan Bhat Versus Dattatraya G. Hegde reported in 2008 (1) RCR (Criminal) 695, at para-22, 23, 25, 26 and 29 as follows:- “Para-22:- The courts below, as noticed hereinbefore, proceeded on the basis that Section 139 raises a presumption in regard to existence of a debt also. The courts below, in our opinion, committed a serious error in proceeding on the basis that for proving the defence the accused is required to step into the witness box and unless he does so he would not be discharging his burden. Such an approach on the part of the courts, we feel, is not correct. Para-23:- An accused for discharging the burden of proof placed upon him under a statute need not examine himself. He may discharge his burden on the basis of the materials already brought on records. An accused has a constitutional right to maintain silence. Standard of proof on the part of an accused and that of the prosecution in a criminal case is different. Para-25:- Furthermore, whereas prosecution must prove the guilt of an accused beyond all reasonable doubt, the standard of proof so as to prove a defence on the part of an accused is preponderance of probabilities. Inference of preponderance of probabilities can be drawn not only from 29 the materials brought on records by the parties but also by reference to the circumstances upon which he relies. Para-26:- A statutory presumption has an evidentiary value. The question as to whether the presumption whether stood rebutted or not, must, therefore, be determined keeping in view the other evidences on record. For the said purpose, stepping into the witness box by the appellant is not imperative. In a case of this nature, where the chances of false implication cannot be ruled out, the background fact and the conduct of the parties together with their legal requirements are required to be taken into consideration. Para-29:- Disputes and differences between him and R.G. Bhat stood established by admission of the respondent himself. Similar industry was being run by R.G. Bhat although he was acting as the constituted attorney of the appellant. According to the appellant, R.G. Bhat had cheated him. The counterfoil showed that not more than Rs. 20,000/- had ever been withdrawn from that bank at a time. The courts were required to draw an inference as to the probability of the complainants advancing a sum of Rs. 1.5 lakhs on mere asking and that too without keeping any documentary proof. Even there was no witness. The purported story that the appellant would himself come forward to return the amount by a cheque knowing fully well that he did not have any sufficient funds is difficult to believe.” 54. It has been held in the case of M. A. Abida Versus HMT Watches Ltd. and Anr. passed in Crl. M. C. No. 2366 of 2008 disposed of on 25.02.2014 by Kerala High Court at para- 43 and 50 as follows:- “Para-43:- There is no meaning in contending that these cheques were not relating to the transactions which were settled by the Settlement Committee. As I have pointed out earlier, it is evident from page No.2 of Annexure-A5 that 30 after payment of the full amount, an amount of 38 lakhs arrived at the settlement made by the Settlement Committee, M/s HMT Watches Ltd. had to return '57 Nos. of security cheques' held by them, to the petitioner. Matters being so, it is evident that these 57 cheques based on which the present complaints have been filed are the very same 57 Nos. of cheques mentioned in page No.2 of Annexure A5. It is further evident from the contents of Annexure A5 that those cheques were issued as "security cheques". When the amounts relating to those credit transactions for which 57 undated cheques were issued, were settled and those payments were made, those 57 cheques are to be treated as cheques without any consideration. Further, it cannot be treated as cheques issued in discharge of any legally enforceable debt or liability so as to make out an offence within the meaning of Section 138 of the N.I. Act. Para-50:- Following the decision in Rahul Builders' case supra, the Division Bench of this Court in Joseph Sartho v. G. Gopinathan and Another 2009 (2) R.C.R. (Criminal) 625:2008 (4) KLT 509, which was a case wherein a cheque was issued in discharge of a debt and subsequently the payee has received part-payment of amount covered by the cheque, it has been held that the bouncing of such a cheque, which did not represent the whole amount covered by the cheque cannot be made use of, for filing a complaint alleging an offence under Section 138 of the N.I.Act. In John G. v. Alosious and Another, 2010 (2) KLT 901, it has been held, "The Explanation to S.138 of the Negotiable Instruments Act would show that the debt or liability mentioned in S.138 is legally enforceable debt or liability. When there is part payment before presenting the cheque, it could not be said that there is legally enforceable debt or liability to the extent shown in the instrument. When the amount 31 shown in the cheque is more than what is legally due or enforceable, no offence u/S.138 is made out, unless the cheque is presented with endorsement regarding partial discharge." 55. It has been held by the Hon‟ble Supreme Court in the case of Krishna Janardhan Bhat Versus Dattatraya G. Hegde reported in 2008 (1) RCR (Criminal) 695 at para-33, 34 and 35 as follows:- “Para-33:- But, we may at the same time notice the development of law in this area in some jurisdictions. The presumption of innocence is a human right. [See Narender Singh & Anr. v. State of M.P., 2004(3) RCR (Criminal) 613:2004(3) Apex Criminal 269: (2004) 10 SCC 699, Ranjitsing Brahmajeetsing Sharma v. State of Maharashtra and Anr. 2005(2) Apex Criminal 389:(2005) 5 SCC 294 and Rajesh Ranjan Yadav @ Pappu Yadav v. CBI through its Director 2007(1) RCR (Criminal) 166: 2006 (3) Apex Criminal 700: (2007) 1 SCC 70] Article 6(2) of he European Convention on Human Rights provides : “Everyone charged with a criminal offence shall be presumed innocent until proved guilty according to law”. Although India is not bound by the aforementioned Convention and as such it may not be necessary like the countries forming European countries to bring common law into land with the Convention, a balancing of the accused rights and the interest of the society is required to be taken into consideration. In India, however, subject to the statutory interdicts, the said principle forms the basis of criminal jurisprudence. For the aforementioned purpose the nature of the offence, seriousness as also gravity thereof may be taken into consideration. The courts must be on 32 guard to see that merely on the application of presumption as contemplated under Section 139 of the Negotiable Instruments Act, the same may not lead to injustice or mistaken conviction. It is for the aforementioned reasons that we have taken into consideration the decisions operating in the field where the difficulty of proving a negative has been emphasized. It is not suggested that a negative can never be proved but there are cases where such difficulties are faced by the accused e,g,. honest and reasonable mistake of fact. In a recent Article “The Presumption of Innocence and Reverse Burdens : A Balancing Duty” published in [2007] C.L.J. (March Part) 142 it has been stated :- “In determining whether a reverse burden is compatible with the presumption of innocence regard should also be had to the pragmatics of proof. How difficult would it be for the prosecution to prove guilt without the reverse burden? How easily could an innocent defendant discharge the reverse burden? But courts will not allow these pragmatic considerations to override the legitimate rights of the defendant. Pragmatism will have greater sway where the reverse burden would not pose the risk of great injustice “where the offence is not too serious or the reverse burden only concerns a matter incidental to guilt. And greater weight will be given to prosecutorial efficiency in the regulatory environment.” Para-34:-We are not oblivious of the fact that the said provision has been inserted to regulate the growing business, trade, commerce and industrial activities of the country and the strict liability to promote greater vigilance in financial matters and to safeguard the faith of the creditor in the drawer of the cheque which is essential to the economic life of a developing country like India. This, 33 however, shall not mean that the courts shall put a blind eye to the ground realities. Statute mandates raising of presumption but it stops at that. It does not say how presumption drawn should be held to have rebutted. Other important principles of legal jurisprudence, namely presumption of innocence as human rights and the doctrine of reverse burden introduced by Section 139 should be delicately balanced. Such balancing acts, indisputably would largely depend upon the factual matrix of each case, the materials brought on record and having regard to legal principles governing the same. Para-35:- Keeping in view the peculiar facts and circumstances of this case, we are of the opinion that the courts below approached the case from a wholly wrong angle, viz., wrong application of the legal principles in the fact situation of the case. In view of the legal position as has been enunciated by this Court in M.S. Narayana Menon (supra) and later cases, we are of the opinion that the High Court should have entertained the revision application.” 56. It has been held in the case of Rajaram S/O Sriramulu Naidu (Since Deceased) through L.RS. Versus Maruthachalam (Since Deceased through L. RS. reported in 2023 LiveLaw (SC) 46 at para-20 as follows:- “Para-20:- After analyzing all these pieces of evidence, the learned Trial Court found that the Income Tax Returns of the complainant did not disclose that he lent amount to the accused, and that the declared income was not sufficient to give loan of Rs.3 lakh. Therefore, the case of the complainant that he had given a loan to the accused from his agricultural income was found to be unbelievable by the learned Trial Court. The learned Trial Court found that it was highly doubtful as to whether the complainant had lent an amount of Rs.3 lakh to the accused. The learned Trial 34 taking Court also found that the complaint had failed to produce the promissory note alleged to have been executed by the accused on 25th October 1998. After into consideration the defence witnesses and the attending circumstances, the learned Trial Court found that the defence was a possible defence and as such, the accused was entitled to benefit of doubt. The standard of proof for rebutting the presumption is that of preponderance of probabilities. Applying this principle, the learned Trial Court had found that the accused had rebutted the presumption on the basis of the evidence of the defence witnesses and attending circumstances.” 57. The judgment passed in the case of Ghurey Lal vs. State of U.P reported in (2008) 10 SCC 450 and Shri Deelip Apte vs. Nilesh P. Salgaonkar and another passed in Criminal Revision Application No.15 of 2006 with Criminal Appeal No.60 of 2005 on 06.07.2006 are not applicable in this case. 58. It is well settled from the several judgments of the Supreme Court of India that complaint case would fail if the complainant failed to implead the Proprietor or Director as a party in the complaint petition. 59. It is evident that the complainant has failed to prove his paying capacity of advance loan of Rs.20,00,000/- (Rs.Twenty Lakhs) to the O.P. No.2 and he had not disclosed this fact even in the Income Tax Return when he was confronted on this question during para-24 of his cross-examination. Thus, the plea of defence that the complainant had no paying capacity of advance loan of Rs.20,00,000/- (Rs.Twenty Lakhs) to the O.P No.2 is well founded. 60. In view of the law laid down by Hon‟ble Supreme Court and in view of the discussion made above, it is evident that the O.P. No.2-Vijay Singh has rebutted the presumption under Section 139 35 of the N.I. Act drawn against him and thus, there is no merit in this Criminal Revision Application also. 61. Thus, it is evident that the complainant has failed to array the Managing Director or proprietor of the company as an accused in this case and it is also evident that the complainant has failed to prove that the cheque issued was the legal liability/enforceable liability and hence the learned Appellate Court has committed no illegality by dismissing the Cr. Appeal No.64 of 2018 and hence this Criminal Revision Application is fit to be dismissed. 62. Accordingly, Cr. Revision No.904 of 2018 is hereby dismissed. Saket/- NAFR (Sanjay Prasad, J.) 36