1. Appellant is the complainant in C.C. No.103/2010 on the file of the Judicial First Class Magistrate-II (Additional Munsiff), Kasaragod. The
complaint was instituted by the appellant alleging offence punishable under Section 138 of the Negotiable Instruments Act, 1881, hereinafter referred
to as the Act. According to the appellant, in consideration of a sum of Rs.1,75,000/- borrowed from him by the 1st respondent, a cheque for
Rs.1,75,000/- dated 25.06.2009 drawn on Bayar Service Co-operative Bank, Bayar was issued to him. He presented the cheque for collection, but it
was returned dishonoured on 05.10.2009 due to insufficiency of funds. The matter was duly intimated to the 1st respondent through a lawyer notice,
which was served on him. But the amount was not paid nor a reply was sent and, aggrieved by the same, he moved the complaint. On appearance on
summons, the 1st respondent pleaded not guilty.
2. The complainant gave evidence as PW1 and Exts.P1 to P4 were marked. On closing the evidence of the complainant, when examined under
Section 313(1)(b) of the Code of Criminal Procedure, hereinafter referred to as the Cr.P.C., the 1st respondent denied the allegation that he had
borrowed Rs.1,75,000/- and issued the Ext.P1 cheque in consideration of the same. He admitted the borrowal of Rs.30,000/- from the complainant, but
denied the other handwritings on the cheque. According to him, he had given the Ext.P1 as signed blank cheque to the appellant, which has been
misused by incorporating a huge amount as consideration; there is no legally enforceable liability to pay Rs.1,75,000/-; Ext.P3 notice is barred by
limitation.
3. There was no evidence in defence for the 1st respondent. On the contentions, three points were raised by the learned Magistrate. After hearing
counsel on both sides, by the impugned judgment, the learned Magistrate found not guilty and acquitted the 1st respondent under Section 255(1)
Cr.P.C. Aggrieved by the same, the complainant has preferred this appeal under Section 378(4) of the Cr.P.C.
4. I heard the learned counsel on both sides. The trial court records were summoned and perused.
5. According to the learned counsel for the appellant, though the statutory notice was duly served on the 1st respondent, he did not give a reply;
thereafter, even though he disputed the financial capacity of the appellant to lend that much money, no evidence was adduced nor a probable version
was urged before court, to rebut the presumption available in favour of the appellant. After having admitted the issuance of the Ext.P1 cheque he
cannot be heard to say that he had borrowed only Rs.30,000/- from the appellant. In this connection, the learned counsel placed reliance on the
decision reported in Bir Singh v. Mukesh Kumar [AIR 2019 SC 2446]. Regarding the contention that the appellant had no financial capability to lend
so much money, the learned counsel placed reliance on an unreported decision of the Karnataka High Court in Crl.A. No.2109/2017 and also in
Rohitbhai Jivanlal Patel v. State of Gujarat and another [AIR 2019 SC 1876]. The counsel concluded that the appellant is financially sound enough to
lend that much money; that the presumption is in his favour and thus, the trial court erred in acquitting the 1st respondent.
6. On the other hand, the learned counsel appearing for the 1st respondent pointed out that the appellant is a tailor by profession and that his monthly
income is only Rs.2,000/-. He has no other source of earning. Even though the 1st respondent did not send a reply to the lawyer notice nor did enter
the box, from the examination of PW1, it is clear that he had challenged the very financial capacity of the appellant to arrange so much money. Even
when it was claimed that he had borrowed money from the bank and had pledged gold ornaments, no evidence was tendered before the trial court to
prove the financial capacity of the appellant. The learned counsel also relied on the decision reported in Basalingappa v. Mudibasappa [2019 (2) KHC
451 SC] and also APS Forex Services Pvt. Ltd. v. Shakti International Fashion Linkers and others [AIR 2020 SC 945].
7. As come out in evidence and the arguments for the parties, it is certain that the complaint was laid on the allegation that the Ext.P1 cheque was
issued by the 1st respondent in consideration of Rs.1,75,000/- borrowed by him from the appellant in June 2009. On presentation, it returned
dishonoured due to insufficiency of funds. Thereafter, a lawyer notice was caused to be issued, which was not responded and that gave the cause of
action for the appellant to move the trial court alleging offence punishable under Section 138 of the Act. The evidence of the complainant is that of his
oral testimony and documents marked as Exts.P1 to P4. No evidence was tendered by the 1st respondent. The case of the 1st respondent is that the
Ext.P1 cheque was issued as a signed blank cheque, in consideration of Rs.30,000/- borrowed by him from the appellant, that the appellant has no
financial capacity to arrange an amount of Rs.1,75,000/-. So the 1st respondent wanted to convince the court that the Ext.P1 cheque was concocted
by incorporating a much higher amount with the clear intention of extracting that much money from the 1st respondent.
8. The complaint was laid on 18.02.2009 before the Chief Judicial Magistrate. Later the case was made over to the trial court where the evidence
was taken. From the oral testimony of the appellant as PW1, it has come out that the transaction had taken place about two weeks prior to the
issuance of Ext.P1 cheque. But such details cannot be discerned from the complaint. Whatever it may be, despite the fact that the Ext.P3 lawyer
notice was not responded, nor the 1st respondent entered the box, the very case of the 1st respondent is that the appellant has no capacity to arrange
so much money, that Ext.P1 was issued only in consideration of Rs.30,000/- borrowed by him.
9. Thus, it is the common case that the Ext.P1 cheque was executed and issued by the 1st respondent to the appellant in consideration of a loan
transaction. Sections 20, 87 and 139 of the Act make it clear that unless the presumption is rebutted, it can be taken that the cheque was issued in
discharge of a legally enforceable liability. Referring to the decision in Bir Sing, quoted supra, it must be stated that even if a signed blank cheque is
issued towards a payment, the payee is entitled to fill up the amount and other particulars, that will not invalidate the cheque. But here, the 1st
respondent has a clear case that the appellant had no capacity to arrange so much money. Now the question is whether, the reason that he did not
respond the lawyer notice nor did enter the box, should an adverse inference be drawn against him. Similarly, in such circumstances, cannot the
borrower deny the financial capacity of the lender? There is no inviolable position that after having admitted issuance of the cheque, the drawer
cannot challenge the capacity of the lender to pay the sum. In the decision reported in Basalingappa, quoted supra, the Hon'ble Supreme Court has
summed up the legal principles thus:-
“23. We having noticed the ratio laid down by this Court in above cases on Sections 118(a) and 139, we now summarise the principles enumerated
by this Court in following manner:-
(i) 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.
(ii) 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.
(iii) To rebut the presumption, it is open for the accused to rely on evidence led by him or accused can also rely on the materials submitted by the
complainant in order to raise a probable defence. Inference of 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.
(iv) That it is not necessary for the accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a
persuasive burden.
(v) It is not necessary for the accused to come in the witness box to support his defence.â€
10. In other words, once execution of the promissory note is admitted, or proved, the presumption under Section 118(a) of the Act would arise that it is
supported by consideration. It is a rebuttable presumption. The accused can prove non-existence of consideration by raising a probable defence. If he
proves to have discharged the initial onus of proof that the existence of consideration was improbable or doubtful, the onus shifts back to the
complainant, who will be obliged to prove it as a matter of fact, and on his failure to discharge the burden, he will be disentitled to get a relief.
11. The trial court is required to start with statutory presumption until the contrary is proved that the cheque was issued or drawn for consideration and
that the complainant had received it for the discharge of existing debt or liability. Then the burden is on the accused, in view of the statutory
presumption, to rebut the presumption by leading an adequate and satisfactory evidence to substantiate his contention in defence to the prosecution.
Although it is not necessary for the accused to enter the witness box, the burden of proof is required to be discharged by adducing satisfactory
evidence to prove that the cheque in question was not issued for discharge of any legally enforceable debt. Merely for the reason that he did not
adduce any evidence to prove a negative fact, no adverse inference can be drawn against him. The degree of proof expected from the accused is not
as rigorous as that of the complainant. He can discharge his onus by making dents in the case of the complainant. Here, it seems that that has been
attempted by the 1st respondent.
12. It has come out from the oral testimony of PW1 complainant that he is a tailor by profession, earning a monthly income of Rs.2,000/-. He has to
take care of his family with two children for whom he has to earmark Rs.750/- from the monthly income. He has no other source of income. Even
though he has 3 acres and 5 cents of land, there is no yield from the property. He had planted the property two years prior to the date of examination
of the witness. In fact, it is a matter of common knowledge that, as far as rubber plant is concerned, initial years are very tough for the planter; he has
to incur huge expenses for nourishing and nursing the plants. He will start to get earnings only when the trees are tapped after six or seven years.
When these aspects were brought out in cross-examination, through re-examination it was tried to be pointed out that he had arranged the amount by
availing a loan from a bank and also by pledging gold ornaments. But no supporting materials were brought in to prove the contention. It may be
realising this lacuna that the appellant moved this Court with Crl.M.A.No.3215/2011 with a prayer for accepting a passbook, a statement of account
and a gold loan receipt. When argued, this Court had specifically asked the learned counsel as to whether she would canvass for a remand, in order to
adduce additional evidence. But it was pointed out that the appellant does not want to adduce additional evidence. Thus this Court cannot look into the
materials. After peeping into the documents produced along with the criminal miscellaneous application the learned counsel for the 1st respondent
submitted that those documents also are of no help to the appellant. Having regard to the circumstances, this Court also feels that a remand would be
an idle exercise.
13. Even though the financial capacity of the appellant stands disputed by the 1st respondent, the appellant has not taken care in adducing evidence
supporting his ability to pay so much money. The complainant is expected to prove his case to the hilt. He cannot take advantage of the failure on the
part of the accused respondent. After considering the rival contentions and materials, this Court is not persuaded to interfere with the finding of the
trial court, which is liable to be confirmed.
In the result, the appeal is dismissed.
