Summary
The complainant challenged acquittal in a cheque-dishonour case arising from settled apple-packing accounts. Although issuance and statutory requirements were established and the presumption remained unrebutted, the courts below dismissed the complaint over discrepancies in quantities and rates. The Supreme Court held that approach perverse, convicted the drawer and imposed a fine of twice the cheque amount with litigation costs.
Issues
- Whether the acquittal disregarded the statutory presumption of debt and the evidence of settled accounts.
Provisions considered
- Sections 118(a) and 139, Negotiable Instruments Act, 1881Proof of cheque issuance attracted rebuttable presumptions of consideration and discharge of an enforceable debt or liability. (¶¶ 19, 20, 22, 23, 26, 28)
Held
- The statutory presumption shifts the evidential burden to the accused to establish a probable defence. Bare denial is insufficient, but rebuttal need not meet the prosecution’s standard and may arise from circumstances or the complainant’s evidence. (¶¶ 19, 20, 21, 22, 23, 29, 30)
- The settled account and cheque were supported by the complainant and the drawer’s agent. The police entry alleging loss of a cheque book and the bare section 313 assertion of misuse did not rebut the presumption on this record. The section 313 statement was not substantive defence evidence. (¶¶ 10, 11, 12, 13, 26, 27)
- Discrepancies about cartons, packing materials and rates did not overcome the established settlement and unrebutted presumption here. Treating the matter as an ordinary civil recovery claim despite those findings was a perverse misapplication of the statutory scheme warranting reversal of acquittal. (¶¶ 18, 27, 28, 29, 30, 32, 33)
Result
The appeal was allowed and the respondent convicted under section 138. He was directed to pay Rs.10,77,712 as fine and Rs.1 lakh litigation costs within three months, failing which he would undergo six months’ imprisonment.