K. Mohan Ram, J.@mdashSince the Petitioner in both the above Criminal Revision Cases are same and the Respondent in Crl. R.C. No. 264 of
2008 is the husband of the Respondent in C.C. No. 236 of 2008 and the issues that arise for consideration in both the above Criminal Revision
Cases are one and the same, both the Criminal Revision Cases are being disposed of by this common order. The Petitioner in the above Criminal
Revision Cases is the accused in C.C. Nos. 190 and 191 of 2001 on the file of the learned Judicial Magistrate No. II, Erode, wherein, he faced
trial for the offence u/s 138 of the Negotiable Instruments Act. After trial, the Trial Court convicted the Petitioner in each case for the said offence
and sentenced him to undergo simple imprisonment for two years and to pay a fine of Rs. 5,000/-, with a default clause. Being aggrieved by that,
the Petitioner preferred Appeals in C.A. Nos. 186 and 187 of 2003 before the Additional District Sessions Judge cum Fast Track Court No. 1,
Erode. The Lower Appellate Court, on an independent consideration of the evidence, confirmed the conviction and sentence imposed on the
Petitioner. Being aggrieved by that, the Petitioner is before this Court.
2. The brief facts which are necessary for the disposal of Crl.R.C. No. 236 of 2008 are set out below:
(i) It is the case of the Respondent that the accused/Petitioner herein is a close friend of her and her family and is doing textile business at
Kumarapalayam. On 12.01.2001, the accused approached Y.S. Mathivanan, the husband of the Respondent, for obtaining loan of Rs. 15 lakhs
and since the Complainant was ready and having only Rs. 5 lakhs, the same was lent to the Petitioner and to repay the said loan amount, the
Petitioner issued a cheque dated 13.03.2001 for a sum of Rs. 5 lakhs. The accused paid advance interest. When Ex. P-2-cheque was presented
for encashment, the same was returned with an endorsement ''insufficient funds''. The Respondent sent a legal notice for which the Petitioner sent a
reply rebutting the averments contained in the notice. Thereafter, the Complaint was filed through the Respondent and the same was taken on file.
(ii) To prove the case of the Complainant in C.C. No. 190 of 2001, two witnesses were examined. P.W. 1 is the husband of the Respondent and
P.W. 2 is the Bank Manager and Exs. P-1 to P-10 have been marked. On the side of the accused, no oral evidence was adduced, but Exs. D-1
to D-5 have been marked. Since the Petitioner had admitted his signature in Ex. P-2-cheque, the Trial Court, rightly raised a legal presumption
available u/s 139 of the Negotiable Instruments Act and further holding that the legal presumption raised u/s 139 of the Act has not been rebutted
by the accused and also on the basis of the other evidence available on record, came to the conclusion that the Complainant has proved his case
and the offence u/s 138 of the Act has been established, convicted the Petitioner u/s 138 of the Negotiable Instruments Act and sentenced him to
undergo simple imprisonment for two years and to pay a fine of Rs. 5,000/- in default to undergo simple imprisonment for three months.
3. The brief facts which are necessary for the disposal of Crl.R.C. No. 264 of 2008 are set out below:
(i) It is the case of the Respondent that the accused/Petitioner herein is a close friend of him and is doing textile business at Kumarapalayam. On
12.01.2001, the accused approached the Complainant/Respondent, for obtaining loan of Rs. 10 lakhs and also borrowed the said sum from the
Complainant and to repay the said loan amount, the Petitioner issued a cheque dated 13.03.2001 for a sum of Rs. 10 lakhs. The accused paid
advance interest. When Ex. P-1 cheque was presented for encashment, the same was returned with an endorsement ''insufficient funds''. The
Respondent sent a legal notice for which the Petitioner sent a reply rebutting the averments contained in the notice. Thereafter, the Complaint was
filed through the Respondent and the same was taken on file.
(ii) To prove the case of the Complainant in C.C. No. 191 of 2001, two witnesses were examined. P.W. 1 is the Respondent and P.W. 2 is the
Bank Manager and Exs. P-1 to P-9 have been marked. On the side of the accused, no oral evidence was adduced, but Exs. D-1 to D-5 have
been marked. Since the Petitioner had admitted his signature in Ex. P-1 cheque, the Trial Court, rightly raised a legal presumption available u/s 139
of the Negotiable Instruments Act and further holding that the legal presumption raised u/s 139 of the Act has not been rebutted by the accused
and also on the basis of the other evidence available on record, came to the conclusion that, the Complainant has proved his case and the offence
u/s 138 of the Act has been established, convicted the Petitioner u/s 138 of the Negotiable Instruments Act and sentenced him to undergo simple
imprisonment for two years and to pay a fine of Rs. 5,000/- in default to undergo simple imprisonment for three months.
4. The Lower Appellate Court has also considered the entire evidence and confirmed the conviction and sentence imposed on the Petitioner in
C.C. Nos. 190 and 191 of 2001. Being aggrieved by that, the Petitioner is before this Court.
5. Heard the learned Counsel on either side.
6. Learned Counsel for the Petitioner submitted that, the defence taken by the Petitioner was that he was a subscriber to a chit, conducted by the
Respondents and that fact has been established by Ex. D-1 and the fact that the Petitioner is a subscriber to the chit conducted by the
Respondents is also not disputed by the Respondent. It has also been admitted that the Petitioner became a successful bidder in the chit. Only
towards the receipt, of the price amount and as security for due repayment of the future instalments, the Petitioner had issued two signed blank
cheques with the Complainant, but the same had been misused. Learned Counsel for the Petitioner further submitted that simply because the
Petitioner had admitted his signatures in the cheques, no legal presumption is raised that the cheques have been issued towards discharge of an
existing liability. He further submitted that no oral or documentary evidence has been adduced on the side of the Complainant to prove the payment
of a sum of Rs. 15 lakhs by the Respondents ? No Account Books have been produced and the payment of this huge amount has not been
reflected in the Income Tax Returns, though it is admitted that the Respondents are Income Tax assessees. It is contended that though the
Petitioner and the Respondents are said to be friends, it is highly improbable that the Respondents would have parted with such a huge amount
without getting any promissory note or security merely after obtaining cheques from the Petitioner. In support of his said contention, the learned
Counsel based reliance on a decision of the Apex Court reported in Krishna Janardhan Bhat Vs. Dattatraya G. Hegde, . In the said decision, in
paragraphs 20 to 23, the Apex Court has laid down as under:
20. Indisputably, a mandatory presumption is required to be raised in terms of Section 118(b) and Section 139 of the Act, Section 13(1) of the
Act defines negotiable instrument to mean a promissory note, bill of exchange or cheque payable either to order or to bearer. Section 138 of the
Act has three ingredients, viz.:
(i) that there is a legally enforceable debt;
(ii) that the cheque was drawn from the account of Bank for discharge in whole or in part of any debt or other liability which pre-supposes a legally
enforceable debt; and
(iii) that the cheque so issued had been returned due to insufficiency of funds.
21. The Proviso appended to the said Section provides for compliance of legal requirements before a Complaint Petition can be acted upon by a
Court of law. Section 139 of the Act merely raises a presumption in regard to the second aspect of the matter. Existence of legally recoverable
debt is not a matter of presumption u/s 139 of the Act. It merely raises a presumption in favour of a holder of the cheque that the same has been
issued for discharge of any debt or other liability.
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 fell, is not
correct.
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.
7. Learned Counsel for the Petitioner further submitted that in the case before the Supreme Court also, the Complainant had not produced any
Books of Accounts or any other proof to show that the Complainant had so much money in the Bank and did not obtain any written documents
from the accused; there was no witnesses to the loan transaction, in such circumstances, the learned Counsel submitted that it should be held that
the initial, legal presumption raised u/s 139 of the Act has been rebutted by the Petitioner. If it is so held, then, it could be seen that there is no
other evidence adduced by the Respondents to prove the payment of sums of Rs. 15 lakhs. He further submitted that though at the relevant point
of time when the cause of action arose, in these cases, the maximum sentence that could be imposed is only one year imprisonment, but the Courts
below basing reliance on the subsequent amendment to Section 138 of the Act, which came into force on 6.2.2003, has imposed the maximum
sentence of two years and therefore submitted that the sentence of two years imposed is illegal. He further submitted that the sentence of
imprisonment may be reduced.
8. On the aforesaid submissions, the learned Counsel for Respondents was heard. Learned Counsel for the Respondents submitted that the
Petitioner had taken several inconsistent defences. He further submitted that in the Reply Notice-Ex. P-7, it is stated follows:
4. My client is one of the members of Lion Club and your client''s husband, Mathivanan also a member of the same. My client, states that he took
part in Lion''s Club Meeting in the same day your client''s husband also took part in the meeting. My client possessed cheques leaf book in his
hand bag which all are misplaced with bag and even after searching the same was not found by my client. In the misplaced cheques leaf were only
lying as blank and not made signature by my client. So far the misplaced cheques leaf with bag were not traced out by my client. Meanwhile, my
client shock and surprise when received your notice alleging my client issued the cheque in favour of your client for Rs. 5 lakhs. My client
understands the misplaced cheques leaf were took your client''s husband and signed and also filled up amount by your client and her husband by
their shims and fancies. Hence your client and her husband colluded together and fabricated the cheques as signed by my client with intend to get
wrongful if possible from my client and issued this legal notice through you. Under the said circumstances, your client''s husband fabricated the
cheque and made signature as like as my client''s signature.
During the course of cross-examination it has not been suggested to P.W. 1 that the signatures found in the cheques in question were either
fabricated or forged, but it was suggested that at the time of obtaining the price amount from the Chit Fund Company run by the Respondents, as
security for the due repayment of the future instalments the Petitioner had issued two signed blank cheques and the same have been misused by
them by filing the present Complaints. It has also been suggested to P.W. 1 during his cross-examination that since the interest amounts of Rs.
12,000/- and Rs. 24,000/- Respectively paid by the Petitioner had not been reflected in the income tax returns of the Respondents and thinking
that the Petitioner had sent a Petition to the income tax Department which resulted in a raid in the premises of the Respondents, a false Complaint
has been filed. Thus, according to the learned Counsel, all possible contradictory defences have been taken and from this it cannot, be said that the
Petitioner had rebutted the legal presumption raised u/s 139 of the Act. He further submitted that it has not even been suggested to P.W. 1 that
either P.W. 1 or his wife are not possessed of sufficient means to advance the total loan amount of Rs. 15 lakhs to the Petitioner and when the
Petitioner himself had not questioned the means of the Petitioner, the question of producing the Account Books does not arise. He further
submitted that since the Petitioner and the Respondent happened to be friends and they had earlier money transactions and the Petitioner is running
a textile business, on the basis of the cheques in question issued by the Petitioner the loan amounts, have been advanced to him. He further
submitted that in all cases it is not necessary that all loan transactions should be supported by some documents.
9. I have considered the aforesaid submissions made by the learned Counsel on either side and perused the materials available on record.
10. Since the Petitioner had not disputed his signatures in the cheques in question but had admitted his signatures, the Courts below are right in
raising a legal presumption u/s 139 of the Act. As has been laid down in the decision reported in Krishna Janardhan Bhat Vs. Dattatraya G.
Hegde, once the execution of the cheque is admitted a presumption is raised that the cheque was drawn for discharge in whole or any part of any
debt or liability which pre-supposes the legal enforceable debt. But in the said decision it has been laid down that the existence of legally
recoverable debt is not a matter of presumption u/s 139 of the Act. It merely raises a presumption in favour of the holder of the cheque that the
same has been issued for discharge of debt or any other liability. Thus, it could be seen that once the execution of the cheque is admitted a
presumption is raised that the same has been issued towards the discharge of any debt or other liability, but no presumption is raised that the
cheque has been issued to discharge a legally enforceable liability. A liability and its legal enforceability are two distinct aspects. A cheque might
have been issued for discharge of a liability, but whether such liability is legally enforceable or not is not a matter of presumption but it is a matter of
proof.
11. Here, it is not the contention of the Petitioner that the debt is barred by limitation or for any other reason it is unenforceable. Therefore, a
presumption is rightly raised by the Courts below that the cheques in question have been issued towards the discharge of the existing liability. Once
such a legal presumption is raised, it is for the drawer/Petitioner herein to rebut the same. As has been laid down in the aforesaid decision to rebut
such presumption it is not always necessary that the Petitioner should enter into the witness box or should examine other witnesses, but he can
rebut such presumption by the other circumstances established from the evidence available on record.
12. In these cases, admittedly, the Petitioner had not gone into the witness box and he has not adduced any other oral evidence, but he has
produced Ex. D-1, copy of the chit payment voucher, to show that the Petitioner was a subscriber to the chit conducted by the Respondents and
this fact has also not been disputed by the Respondents. It has also been in evidence that the Petitioner became a successful bidder in the auction
and according to the Complainant, the prize chit amount was paid to the Petitioner herein, as evidenced from Ex. D-1. But it has been suggested to
P.W. 1 during his cross-examination that the sum of Rs. 2,10,000/- namely, the prize amount has not been paid to the Petitioner. As suggested by
the Petitioner himself, if the price amount of Rs. 2,10,000/- has not been paid to the Petitioner, then, it is un-understandable as to why the
Petitioner had parted with two blank signed cheques. Therefore, the defence taken is mutually contradictory and unbelievable. Further, such a
defence has not been taken in the Reply Notice Ex. P-7. In the reply notice it has been stated, as has been extracted above, namely, that the
cheques in question were taken away by the Respondents and have been misused. Further, as pointed out by the learned Counsel for the
Respondents, a suggestion has been put to P.W. 1 that since the interest amounts of Rs. 12,000/- and Rs. 24,000/-, respectively, paid by the
Petitioner had not been reflected in the income tax returns and the Respondents felt that only on a Petition sent by the Petitioner to the income tax
department a raid was conducted in the premises of the Respondents and that suggestion will show as if the Petitioner had paid interest for the loan
amounts borrowed from the Respondents. Thus it could be seen that all possible contradictory defences have been taken by the Petitioner, but
none of these defences have been established.
13. When the legal presumption raised u/s 139 of the Act is not rebutted by the drawer/Petitioner herein and when it is not shown that the liability
is not enforceable, naturally, the Courts below are right in holding that the Respondents had proved the commission of an offence u/s 138 of the
Act. The reasons assigned by the Courts below on the basis of the legal evidence available on record cannot be said to be erroneous. Therefore,
this Court is not inclined to interfere with the conviction awarded by the Courts below. But, however, as contended by the learned Counsel for the
Petitioner, since the Amendment to Section 138 of the Act has come into force only with effect from 06.02.2003, the sentence of two years
imprisonment cannot be imposed in respect of the offence committed prior to the coming into force of the Amendment. Therefore, the maximum
sentence that could have been imposed on the Petitioner is only one year. But, however, considering the facts and circumstances of the cases, ends
of justice would be met, if the sentence of imprisonment is reduced to nine months imprisonment in each cases. The fine of Rs. 5,000/- in each
cases imposed by the Counts below on the Petitioner is confirmed. With the above said modification in sentence, the Criminal Revision Cases are
dismissed.