Judgment:
(Prayer: This Criminal Revision Petition is filed under Section 397 read with Section 401 Code of Criminal Code, 1973, by the advocate for the petitioner praying to set aside the judgment and order of affirm dated 28.10.2009 in Criminal Appeal Judge, Bengaluru City (FTC-VI) and set aside the judgment and order of sentence dated 10.4.2007 passed by the 15th Additional Chief Metropolitan Magistrate, Bangalore City in C.C.No.1311/2005, by allowing the Revision Petition.)
1. Heard the learned counsel for the petitioner and the learned counsel for the respondent.
2. The petitioner was the accused before the Trial Court whereby the complainant had alleged an offence punishable under 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the Act, for brevity) under the following circumstances. It was the case of the respondent that she had lent a sum of Rs.2,25,000/- on 25th December, 2002 to the petitioner and in repayment of the said amount, the accused has issued a cheque in favour of the complainant for the said sum, dated 8th June 2004, drawn on Canara Bank, Tumkur Road Branch, Bangalore. When the cheque was presented for encashment, the same was returned with an endorsement that it had been dishonoured for insufficient funds in the account of the accused. Thereafter, the legal notice was issued, which was sent by way of Registered Post Acknowledgment Due as well as Under Certificate of Posting, calling upon the accused to pay the said amount covered under the Cheque. Since the petitioner failed to comply with the same, the complaint followed. The petitioner did appear before the Trial Court on summons being served on him and raised several defence, including the defence that the notice issued by the respondent-complainant under Section 138 of the NI Act was never served on him, apart from contending that though a promissory note was also produced in evidence of the loan transaction and the cheque having been issued on his account and duly signed by the petitioner, the contention raised was the cheque was not issued in discharge of any legal liability and the documents were sought to be misused by the complainant since she had procured them from the possession of one Rajanna, in whose custody it was as security in an independent chit transaction, and therefore, the complainant could not, on the basis of those documents, seek to enforce the liability or allege that the offence had been committed punishable under Section 138 of the NI Act. The Trial Court, however, negated the contention and convicted the petitioner for the offence and sentenced him to pay a fine of Rs.2,72,000/-, out of which a sum of Rs.2,70,000/- was to be paid as compensation to the respondent-complainant. That was carried in appeal. The Appellate Court has confirmed the conviction. It is this, which is under challenge in the present petition.
3. The learned counsel for the petitioner would vehemently seek to contend that insofar as the presumption raised under Section 139 of the NI Act in favour of the holder of the cheque is concerned, as to when the burden would shift to the complaint, notwithstanding such a presumption under Section 138 of the NI Act, has been spelt out by a three Judge Bench decision of the Supreme Court in the case of RANGAPPA v. MOHAN [AIR 2010 SC 1898] and would submit that it is laid down therein that such presumption is discharged not only by the accused tendering evidence before the Court, it could also be demonstrated from the evidence tendered by the complainant himself that no such legal liability existed. In the present case, it is the comprehensive defence of the petitioner that there was no complete transaction whereby it cold be said that eh cheque had been issued in support of an outstanding legal liability, as already contended, and the same had been issued not in discharge of any loan transaction as alleged by the complainant but was given as security and was to be in the custody of one Rajanna in an independent transaction and therefore, the burden was clearly on the complainant to establish otherwise, and the Courts below had overlooked this legal aspect of the matter in proceeding to hold that the petitioner had committed the offence aforesaid. He would also submit that the petitioners addresses were alternatively furnished by the complainant even in the complaint and hence the contention that notice was not duly served, has been glossed over by the Courts below. The petitioner belongs to a village coming under Nuggehalli Hobli, whereas it is evidence that the complainant has shown the petitioners village has been situated in Nuggehalli Hobli and this error has apparently resulted in the notice not having been duly served on the petitioner and it was for this reason that the postal cover, which was sent by Registered Post Acknowledgment Due, purportedly containing the notice issued under Section 138 of the NI Act, had been returned as not claimed. The Courts below, therefore, could not have proceeded on a presumption that notice had been duly served on the petitioner and hence the very entertainment of the complaint not having complied with a mandatory requirement preceding the complaint, has been completely overlooked. The learned counsel would submit that positive evidence was tendered by the petitioner by fielding Rajanna, who was a mutual acquaintance of both the complaint and the petitioner, and in his evidence he has clearly stated the Cheque and the documents had been given as security in a chit transaction and that aspect of the matter has been completely negated by the Courts below in holding otherwise. The learned counsel for the petitioner also places reliance on a decision of this Court in case of DEVI PRASAD RAI v. A.M. GANESH RAI [2005(3) KCCR 1576] to contend that when notice is not served on the accused at the correct address, the burden of proof is on the complainant regarding dishonor and service of notice.
4. While the learned counsel for the respondent, on the other hand, would seek to justify the judgments of the Courts below and would contend that the very grounds that are urged in the present petition by the petitioner, have been vehemently canvassed before both the Courts below and cogent reasons have been assigned by the Courts below in negating the same including the legal aspect of whether the proceedings stood vitiated on account of an invalid notice issued, and therefore, there is no warrant for interference by this Court.
5. On a close examination of the record and in the light of the rival contentions, insofar as the first contention that the very institution of the complaint was bad and there is no valid service of notice is concerned, the decision that is cited by the learned counsel for the petitioner, could only be an authority for the case decided therein, because the facts and circumstances of that case and the interpretation given to Section 94 of the NI Act falling under Chapter VIII in relation to dishonor by non-acceptance of a bill of exchange or dishonor or non-payment and by whom notice should be given and the mode in which the notice may be given as contemplate under Sections 91 to 94 of the NI Act, is not in context of the dishonor of a cheque and hence cannot be pressed into service. On the other hand, the learned counsel for the respondent has brought to the attention of this Court a three Judge Bench decision of the Apex Court in C.C. ALAVI HAJI v. PALAPETTY MUHAMMED AND ANOTHER [2007(3) CRIMES 120 (sc), which the authoritatively dealt with the aspect of service of notice in terms of Section 138(b) of the NI Act and the presumption or inference to be drawn either under Section 27 of the General Clauses Act, 1897 or under Section 114 of the Indian Evidence Act, 1872, is concerned. It is seen that the said decision of the Apex Court has laid down that where a payee despatches a notice by registered post with the correct address of the drawer of the cheque, the principle incorporated in Section 27 of the General Clauses Act would be attracted. The requirement of clause (b) of the proviso to Section 138 of the NI Act stands complied with and the cause of action to file a complaint arises on the expiry of the period prescribed in Clause (c) of the said proviso, for payment by the drawer of the cheque. Nevertheless, it would be without prejudice to the right of the drawer to show that he had no knowledge that notice was brought to his address, and further, it is also laid down with reference to Section 114 of the Indian Evidence Act that if the same is read with illustration (f) appended to the said Sections, when it appears to the Court that the common course of business has been followed in particular case, the probable thing that would happen, the Court may draw presumption that the thing would have happened unless there are circumstances in a particular case to show that a common course of business was not followed. Therefore, it was laid down that Section 114 of the Indian Evidence Act enables the Court to presume the existence of any acts, which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, it their relation to the facts of the particular case, and therefore, the Court can presume that the common course of business has been followed in a particular case when applied to a communication sent by post. Section 114 of the Indian Evidence Act enables the Court to presume that in the common course of a natural event, the communication would have been delivered at the address of the addresse. A presumption that is raised under Section 27 of the General Clauses Act is a stronger presumption and it is a specific presumption, which, in effect, reads as follows:
27. Meaning of service by post
Where any (Central Act) or Regulation made after the commencement of this Act authorizes of requires any document to be served by post, where the expression serve or either of the expressions give or send or any other expression in used, then, unless a different intention appears, the service shall be deemed to be effected by properly addressing pre-paying and posting by registered post, a letter containing the document, and unless the contrary is proved, to have been affected at the time at which the leter would be delivered in the ordinary course of post.
And the Apex Court has further expounded thus:
14. In light of these extracts, we are in agreement with the respondent-claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat (supra) may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant. Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments,. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonor of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused/defendant cannot be expected to discharge an unduly high standard or proor. 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 fall. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own.
6. If the ratio laid down in the above decision, if applied to the facts of the present case, the contention of the petitioner is that notice was issued to Nagehalli when the petitioner as in Nuggehalli. This statement is not entirely correct since the petitioner was neither from Nuggehalli nor Nagehalli, the petitioner belongs to Dasapura village and the notice had been sent to Dasapura only. Incidentally, it is said to be within Nagehalli Hobli and even if it had been indicated as Nuggehalli Hobli, it would make no difference because it is not denied by the petitioner that he belonged to Dasapura village. Even otherwise, as further laid down in by Supreme Court C.C.ALAVI HAJI (supra), it is also possible that the entire purpose of requiring notice is to give an opportunity to the drawer to pay the cheque amount within 15 days of service of notice and thereby free himself from the penal consequences of Section 139 of the NI Act and the Court has quoted with approval the decision in the case of D. VINOD SHIVAPPA v. NANDA BELLIAPPA [2006(6) SCC 456] as follows:
16. As noticed above, the entire purpose of requiring a notice is to give an opportunity to the drawer to pay the cheque amount within 15 days of service of notice and thereby free himself from the penal consequences of Section 138. In Vinod Shivappa (supra), this Court observed:
One can also conceive of cases where a well intentioned drawer may have inadvertently missed to make necessary arrangements for reasons beyond his control even though he genuinely intended to honour the cheque drawn by him. The law treats such lapses induced by inadvertence or negligence to be pardonable, provided the drawer after notice makes amends and pays the amount within the prescribed period. It is for this reason that Clause (c) of proviso to Section 138 provides that the section shall not apply unless the drawer of the cheque falls to make the payment within 15 days of the receipt of the said notice. To repeat, the proviso is meant to protect honest drawers whose cheques may have been dishonoured for the fault of others, or who may have genuinely wanted to fulfil their promise but on account of inadvertence or negligence failed to make necessary arrangements for the payment of the cheque. The proviso is not meant to protect unscrupulous drawers who never intended to honour the cheques issued by them, it being a part of their modus operandi to cheat unsuspecting persons.
17. It is also to be borne in mind that the requirement of giving of notice is a clear departure from the rule of Criminal Law, where there is no stipulation of giving of a notice before filling a complaint. Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under Section 138 of the Act, make payment of the cheque amount and submit to the Court that he had made payment within 15 days of receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the Court along with the copy of the complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the G.C.Act and Section 114 of the Evidence Act. In our view, any other interpretation of the proviso would defeat the very object of the legislation. As observed in Bhaskarans case (supra), if the giving of notice in the context of Clause (b) of the proviso was the same as the receipt of notice a trickster cheque drawer would get the premium to avoid receiving the notice by adopting different strategies and escape from legal consequences of a Section 138 of the Act.
7. Therefore, since it is not denied by the petitioner that he had appeared before the Trial Court on service of summons, it was always open for the petitioner to have made the payment and to have absolved himself of any criminal liability, if the only contention that is to be addressed was whether there was valid service of notice. Hence, the question of validity of service of notice would not assist the petitioner in his defence in this case.
8. Insofar as the second aspect of the matter that the presumption in favour of the holder of a cheque under Section 139 of the NI Act would not apply in the present case on hand since the petitioner had tendered positive evidence to discharge that presumption, is again misleading, as the only defence sought to be raised by the petitioner was that there was an independent chit transaction and it was pursuant to that independent transaction that a cheque and a promissory note had been entrusted to Rajanna and that the complainant had illegally obtained custody of those documents and it is those documents which are sought to be pressed into service in the present complaint. On this aspect of the matter, the very contention having been raised before the Courts below, the Trial Court had specifically addressed the same and expressed that it was indeed with the knowledge of the complainant that the documents had been illegally obtained by the complainant, it is inexplicable that the petitioner did not choose to give a complaint to the police or to take other measures insofar as that conduct of the complainant is concerned and hence has disbelieved the evidence set forth. Therefore, for the petitioner to contend that there was evidence before the Court which has been negated and that he had discharged the burden, is a self-serving assertion. The evidence and circumstances that were claimed have been addressed by the Courts below and have been negated on merits. Hence, it cannot be said that the petitioners case has been overlooked or that the burden was on the complainant to establish the case notwithstanding that there was a cheque in favour of the complainant duly signed by the petitioner, and hence that contention also would not be available.
9. The learned counsel would make a desperate attempt to contend that there were witnesses who have signed on the promissory note and in the present proceedings the same has been by two persons and there was no specific contention in the cross-examination as to whether the promissory note has been executed by the persons that of the accused and the complainant and witness to the Promissory note having not been examined, the initial burden was on the complainant to examine the witnesses. This is the contention which could be discredited at the outright, a it was not initial burden on the part of the petitioner to establish that since the promissory note had been deposited with one Rajanna there would not be any obligation on the part of the complainant to examine the attesting witnesses, as the promissory note does not require attestation and when the complainant does not deny the signature on the promissory note. Hence, the petition miserably fails and stands dismissed.
Consequently, the petition is dismissed.