JINESH (HUF) vs. THE INCOME TAX OFFICER

CRL.A No. 169 of 2012

two weeks. Accordingly, the complainant lend a sum of Rs.12,00,000/- to the accused. Towards the discharge of the said legal liability, the accused issued cheque bearing No.0798186 dated 26.05.2008 for Rs.12,00,000/- drawn on Chitradurga Gramina Bank, Rampura, Davangere Taluk. When the complainant presented the said cheque for encashment, the same came to be disnourned with an endorsement ‘insufficient funds’ in the account of accused. Then the complainant got issued statutory notice to the accused dated 02.07.2008 through RPAD. The said notice was served on the accused. But the accused neither gave reply to the said notice nor repaid the amount. Hence, the complainant filed a complaint.

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complaint which is not correct. The learned counsel argued that the appellant and accused are friends and the complainant himself withdrawn the amount through a 'self cheque' which is evident from Ex.D2, whereby the complainant has withdrawn a sum of Rs.12,00,000/- on 09.05.2008 and given to the accused on the same day. Simply because, the complainant has stated that the amount paid through cheque and given to the accused, does not mean that amount was paid through cheque to the accused, but it is his self drawn cheque, which was encashed by him and paid to the accused. In that context, the evidence of the complainant has to be appreciated.

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Court wrongly acquitted the accused. With these main arguments, learned counsel prayed to convict the accused and to allow the petition. In support of his arguments the learned counsel relied on the following decisions:

1) Rohitbhai Jivanlal Patel Vs. State of Gujarat and

another - (2019) 18 SCC 106 2) Shree Daneshwari Traders Vs. Sanjay Jain and another – (2019) 16 SCC 83 3) Bir Singh Vs. Mukesh Kumar – (2019) 4 SCC 197 4) Sumeti Vij Vs. Paramount Tech Fab Industries - 2021 SCC Online SC 201

5) M/s. Kalamani Tex & Anr. Vs. P.Balasubramanian – Crl.A.No.123/2021 dated 10.02.2021 6) P. Rasiya Vs. Abdul Nazer and another – (2022) SCC Online SC 1131

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consideration amount. The learned counsel drawn attention of the Court to the cross-examination of complainant, wherein he has clearly stated that the amount was paid through cheque. But no documents are produced to prove that the accused has issued cheque to the complainant. The accused has given his defence evidence and has examined the manager of the bank and got secured cheque of the complainant through which the complainant has withdraw the amount and on that cheque also there is no signature of the accused stating that the amount is paid to the accused. Therefore, in the absence of any such signature of the accused appearing on the said cheque, the Court cannot presume that the payment was made through cheque to the accused. Therefore, the complainant has failed to prove the mode of payment through cheque. On the other hand, the accused has given probable defence by leading his defence evidence that there was a chit transaction with one Rehamuthulla and the complainant and in that connection at the request of said Rehamathulla, as the surety to Rehamathulla, the accused has issued a said cheque for

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Rs.12,00,000/- to the Rehamathulla. The complainant has misused the same and filed this case. 9. Learned counsel further argued that, the complainant has failed to prove as to how the payment was made and has not produced any document to show that the accused has received any such amount and there is no necessity to the accused to borrow such huge amount. The defence set up by the respondent/accused is probable one. On the other hand, the complainant has failed to prove that the accused borrowed any amount from him. Therefore, there is no question of any legally recoverable debt due by the accused. In support of his arguments, learned counsel relied on the decision of Hon’ble Supreme Court in the case of Kamala S. Vs. Vidyadharan M.J. - AIR 2007 SC (SUPP) 1142. Further the learned counsel argued that the Trial Court has appreciated the defence evidence of the accused in a proper perspective and has rightly come to the conclusion that the complainant has failed to discharge his initial burden and the complainant has failed to prove that he has lend the amount to the accused. Therefore, the Trial Court has rightly acquitted the accused and dismissed the appeal. With these

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main arguments learned counsel prayed to dismiss the appeal. 10. I have perused the judgment of acquittal passed by the Trial Court and other material placed on record. 11. Learned ACMM in his judgment has rasied three points for consideration which are as under: 1) Whether complainant proves that accused has issued three cheques in different dates so as to discharge the legal debt of Rs.12,00,000/- in favour of the Complainant which came to be bounced? 2) Whether complainant further proves that she issued legal notice to accused which came to be served on her. Despite the accused has not paid cheque amount. Thereby accused committed an offence punishable under Sec.138 of N.I Act? 3) To what order?

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the accused to the complainant. Therefore, the first point framed by the Trial Court for consideration is not correct. In a cases filed under Section 138 of N.I. Act, firstly, the complainant is required to prove that there was a legally enforceable debt or liability which is recoverable by him. Then the Court has to see whether the complainant has discharged his initial burden, then the Court has to consider that whether the accused has discharged his burden either by way of cross- examining the complainant or by way of leading the defence evidence and to ascertain who has discharged onus casted upon them. Instead of that, the Trial Court misdirected itself and not framed proper points for consideration. The second point for consideration is also regarding the service of legal notice on the accused and no where it is stated that either legal notice was not issued or it was served on the accused. The learned ACMM has misdirected himself and raised irrelevant points for consideration and acquitted the accused.

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Ex.P1/cheque. Learned ACMM has referred to the evidence of the bank manager/DW.2 and found that the said cheque is a self cheque of the complainant for a sum of Rs.12,00,000/- and there is no signature of the accused/withdrawer on the back side of the said cheque. It is only the signature of the complainant appearing on the said cheque. The learned ACMM has held that the complainant has failed to prove that he has lend a sum of Rs.12,00,000/- through EX.D2-cheque. The learned ACMM has further held at paragraph No.9 that the accused has issued Ex.P1/cheque to one Rehamathulla who is having a chit transaction with complainant and the same is reiterated by the accused in his defence evidence and the learned ACMM has held that it appears to be true facts and referred to the decision of Hon'ble Supreme Court in the case of Rangappa Vs. Mohan reported in AIR 2010 SC 1898 and held that the complainant has failed to prove that he has lend the amount to the accused and accused has rebutted the presumption arising under section 138 of N.I. Act and acquitted the accused. 14. I have considered the evidence on record and perused the complaint filed before the Trial Court.

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documents as per Exs.P1 to P9. Ex.P1 is the cheque wherein the said cheque shows that it was issued in favour of the complainant and it is signed by the accused. Ex.P2 is the bank endorsements wherein it is stated that the cheque came to be dishonored, as the 'funds were insufficient'. Ex.P3 is the legal notice dated 02.07.2008, wherein it is stated that the complainant has lend a sum of Rs.12,00,000/- and issuance of cheque bearing No.0798186 by the accused and the said cheque came to be dishonored. Ex.P3(a) is the postal acknowledgment. It is stated that the said notice is served on the complaint. Ex.P4 is the certificate of posting. Ex.P5 is the intimation issued by the bank wherein it is stated that the cheque has come back with an endorsement 'funds insufficient'. Ex.P6 is the pass book of the complainant wherein the entry at Ex.P6A shows that a sum of Rs.12,00,000/- was withdrawn through a self cheque on 9.5.2008. From these documents produced by the complainant and also on perusing the examination-in-chief affidavit and other documentary evidence, at this stage, it is evident that the complainant has complied with the ingredients of Section 138 of N.I. Act. From the perusal of

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the complaint averments, oral evidence and documentary evidence, the presumption under Sections 118 and 139 of N.I. Act arise in favour of holder of the cheque. The Hon’ble Supreme Court in the above referred decisions relied on by the learned counsel for the appellant, has discussed in detail as to how the presumption can be rebutted. It is the settled principles of law that the accused can rebut the said presumption either by way of cross-examining the complainant or by leading defence evidence and to show before the Court by preponderance of probability that the case made out by the complainant is not probable and cannot be believed and accused defence is probable. 17. In order to appreciate the same, I have considered the cross-examination of PW.1 and it is no doubt true that the complainant neither in his examination-in-chief nor in complaint or legal notice has stated as to how a sum of Rs.12,00,000/- was paid. But from Ex.P6/pass book of the complainant, it is evident that the complainant on 09.05.2008 through a self cheque has withdrawn the said amount.

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sufficient source of income from agriculture and estate business. He has also stated that he has let his property on rent basis to run factory and have sufficient source of income from said rent also. Even PW.1 has got dry lands. PW.1 stated that he has not produced documents pertaining to above said source of income and he states that he would produce the documents to that effect. A suggestion was made to PW.1 that he has filled the cheque of accused to his convenience which is denied by PW.1. It is suggested as accused has no capacity to repay Rs.12,00,000/- Even accused has no property worth of Rs.5,00,000/-. It is also suggested that he has filled the blank cheque and filed false complaint. It is suggested that PW.1 used to lend amount and take cheque from concerned person as security and used to misuse such blank cheques and used to file false complaint on his whims and fancies. But PW.1/complainant denied the all such suggestions. Then again in the cross-examination he was confronted with Ex.P6/pass book. The complainant denied the suggestions that he has kept other two blank cheques of accused and the accused has not borrowed any amount from him and not issued Ex.P1/cheque to discharge said debt. In the further cross-

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examination of PW.1, he has also produced his income tax returns as per Exs.P8 and P9. Further PW.1 has denied the suggestion that he has prepared and created Ex.P8 for the convenience of this case by colluding with his auditor. 19. Therefore, on perusing the evidence of PW.1 and reasons assigned by the learned ACMM, it is evident that the accused has not rebutted presumption in favour of complainant and not discharged his burden in cross-examination of PW.1. The defence evidence lead by the accused is that the cheque in question was given by the accused as a security to one Rehamuttala, who was the subscriber of chit business run by the complainant and in turn the complainant has misused the same and filed a false complaint. With regard to the said aspect, while cross-examining the complainant, the accused has neither put any suggestions regarding the same and no such answers were elicited from the complainant. On the other hand, contradictory suggestions were made stating that a blank cheque was given to complainant and the complainant has also kept other two to three cheques of accused and the complainant has misused them. For what purpose the blank cheque was given and why other two to three cheques were

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given to complainant is not forthcoming. If at all the accused has issued a blank cheque and the complainant has misused the same, why the accused has not taken any action against the complainant is not forthcoming. Absolutely nothing is elicited from the cross-examination of complainant to show that the accused has rebutted the presumption.

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the said amount. If he has not received the amount, then why he has given cheque in the name of complainant is not forthcoming. On the other hand, totally contradictory and inconsistent defence is set up by the accused which cannot be believed at all.

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was conducting the chit business and one Rehamathulla was the subscriber to the said chit and the chit amount was Rs.5,00,000/- The said Rehamathulla had participated in the chit transaction which is stated to have been conducted in the year 2001 and he won the bid amount and at the time of payment of chit amount, the complainant insisted for one surety and Rehamathulla who is the close friend of accused requested him to sign the surety, hence the accused agreed and issued blank cheque to Rehamathulla in the year 2001 and the said cheque is misused by the complainant and he got presented the same for encashment in the year 2008.

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signature. Therefore, an adverse inference will have to be drawn against the accused for not producing any such evidence to believe that the accused has rebutted the presumption arising in favour of complainant by way of preponderance of probability. In the cross-examination, the accused has clearly admitted that himself and the complainant are friends. He know the complainant since the year 2000. Even when the complainant shifted to Bangalore his friendship continues with him and the accused has also admitted that the complainant used to visit him. Accused has clearly stated that he does not know the name of chit business run by the complainant and he has stated that the complainant was running chit business from the year 2001 and 2003, then how in the year 2008, the complainant filed the complaint is not forthcoming. Accused has admitted that he has no document to show that the complainant was running such chit business. He again stated that he came to know about Rehamathulla only through the complainant. On the other hand, in the examination-in-chief, he has stated that Rehamathulal is his friend and he cannot say when the Rehamathulla become highest bidder in the chit and when he has taken chit amount

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and even he cannot say when he stood as surety to the said Rehamathulla. Again accused stated in his cross-examination that he has not issued the cheque to Rehamathulla and this again goes against the accused. At one instance the accused stated that he has issued cheque to Rehamathulla. Then the defence of the accused is that he has issued blank cheuqe to Rehamathull is falsified and the rest of the cross-examination of accused is one of denials.

1 (2019) 18 SCC 106

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a sum of Rs.3 lakhs each. The said cheques were presented to the bank concerned within the period of their validity and were returned unpaid for the reason of either the balance being insufficient or the account being closed. All the basic ingredients of Section 138 as also of Sections 118 and 139 are apparent on the face of the record. The Trial Court had also consciously taken note of these facts and had drawn the requisite presumption. Therefore, it is required to be presumed that the cheques in question were drawn for consideration and the holder of the cheques i.e., the complainant received the same in discharge of an existing debt. The onus, therefore, shifts on the accused-appellant to establish a probable defence so as to rebut such a presumption. 17. On the aspects relating to preponderance of probabilities, the accused has to bring on record such facts and such circumstances which may lead the Court to conclude either that the consideration did not exist or that its non- existence was so probable that a prudent man would, under the circumstances of the case, act upon the plea that the consideration did not exist. This Court has, time and again, emphasized that though there may not be sufficient negative evidence which could be brought on record by the accused to discharge his burden, yet mere denial

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would not fulfil the requirements of rebuttal as envisaged under Section 118 and 139 of the NI Act. This court stated the principles in the case of Kumar Exports (supra) as follows: "20. The accused in a trial under Section 138 of the Act has two options. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the non-existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed. To rebut the statutory presumptions an accused is not expected to prove his defence beyond reasonable doubt as is expected of the complainant in a criminal trial. The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the court need not insist in every case that the accused should disprove the non- existence of consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that bare denial of the passing of the consideration and existence

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of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumptions, the accused should bring on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist. Apart from adducing direct evidence to prove that the note in question was not supported by consideration or that he had not incurred any debt or liability, the accused may also rely upon circumstantial evidence and if the circumstances so relied upon are compelling, the burden may likewise shift again on to the complainant. The accused may also rely upon presumptions of fact, for instance, those mentioned in Section 114 of the Evidence Act to rebut the presumptions arising under Sections 118 and 139. 21. The accused has also an option to prove the non-existence of consideration and debt or liability either by letting in evidence or in

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some clear and exceptional cases, from the case set out by the complainant, that is, the averments in the complaint, the case set out in the statutory notice and evidence adduced by the complainant during the trial. Once such rebuttal evidence is adduced and accepted by the court, having regard to all the circumstances of the case and the preponderance of

probabilities, the evidential burden shifts back to the complainant and, therefore, the presumptions under Sections 118 and 139 of the Act will not again come to the complainant's rescue." 18. In the case at hand, even after purportedly drawing the presumption under Section 139 of the NI Act, the Trial Court proceeded to question the want of evidence on the part of the complainant as regards the source of funds for advancing loan to the accused and want of examination of relevant witnesses who allegedly extended him money for advancing it to the accused. This approach of the Trial Court had been at variance with the principles of presumption in law. After such presumption, the onus shifted to the accused and unless the accused had discharged the onus by bringing on record such facts and circumstances as to show the preponderance of

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probabilities tilting in his favour, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of funds for advancing loan to the accused-appellant. The aspect relevant for consideration had been as to whether the accused-appellant has brought on record such facts/material/circumstances which could be of a reasonably probable defence. 19.6 The fact of the matter remains that the appellant could not deny his signatures on the said writing but attempted to suggest that his signatures were available on the blank stamp paper with Shri Jagdishbhai. This suggestion is too remote and too uncertain to be accepted. No cogent reason is available for the appellant signing a blank stamp paper. It is also indisputable that the cheques as mentioned therein with all the relevant particulars like cheque numbers, name of Bank and account number are of the same cheques which form the subject matter of these complaint cases. The said document bears the date 21.03.2007 and the cheques were post- dated, starting from 01.04.2008 and ending at 01.12.2008. There appears absolutely no reason to discard this writing from consideration.

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of receipts or accounts or want of evidence as regards source of funds were not of relevant consideration while examining if the accused has been able to rebut the presumption or not. The other observations as regards any variance in the statement of complainant and witness; or want of knowledge about dates and other particulars of the cheques; or washing away of the earlier cheques in the rains though the office of the complainant being on the 8 th floor had also been of irrelevant factors for consideration of a probable defence of the appellant. Similarly, the factor that the complainant alleged the loan amount to be Rs. 22,50,000/- and seven cheques being of Rs. 3,00,000/- each leading to a deficit of Rs. 1,50,000/-, is not even worth consideration for the purpose of the determination of real questions involved in the matter. May be, if the total amount of cheques exceeded the alleged amount of loan, a slender doubt might have arisen, but, in the present matter, the total amount of 7 cheques is lesser than the amount of loan. Significantly, the specific amount of loan (to the tune of Rs. 22,50,000/-) was distinctly stated by the accused-appellant in the aforesaid acknowledgment dated 21.03.2017. 21. On perusing the order of the Trial Court, it is noticed that the Trial Court proceeded to pass the

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order of acquittal on the mere ground of 'creation of doubt'. We are of the considered view that the Trial Court appears to have proceeded on a misplaced assumption that by mere denial or mere creation of doubt, the appellant had successfully rebutted the presumption as envisaged by Section 139 of the NI Act. In the scheme of the NI Act, mere creation of doubt is not sufficient. 22. The result of discussion in the foregoing paragraphs is that the major considerations on which the Trial Court chose to proceed clearly show its fundamental error of approach where, even after drawing the presumption, it had proceeded as if the complainant was to prove his case beyond reasonable doubt. Such being the fundamental flaw on the part of the Trial Court, the High Court cannot be said to have acted illegally or having exceeded its jurisdiction in reversing the judgment of acquittal. As noticed hereinabove, in the present matter, the High Court has conscientiously and carefully taken into consideration the views of the Trial Court and after examining the evidence on record as a whole, found that the findings of the Trial Court are vitiated by perversity. Hence, interference by the High Court was inevitable; rather had to be made for just and proper decision of the matter.

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2 (2019) 16 SCC 83

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the examination of PW-1, the statutory presumption under Section 139 of the Act arises that the cheques were issued by the respondent- accused for the discharge of any debt or other liability in whole or in part. The courts below disbelieved the evidence of the complainant on the ground that there are no averments in the complaint that the commodities were sold for cash and that the rice bags were sold on credit and the cheques were issued for the goods sold on credit. Though the complaint contains no specific averments that the cheques were issued for the purchase made on credit, in his evidence, PW-1 clearly stated that the cheques were issued for the commodities purchased on credit. The courts below erred in brushing aside the evidence of PW- 1 on the ground that there were no averments in the complaint as to the purchases made by cash and purchase. The courts below also erred in not raising the statutory presumption under Section 139 of the Act that the complainant received the cheques to discharge the debt or other liability in whole or in part."

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3 (2019) 4 SCC 197

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ought not to have acquitted the respondent- accused of the charge under Section 138 of the Negotiable Instruments Act.

4 2021 SCC Online SC 201

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assistance for the reason that in the case dealing under Section 138 of the Act, the prosecution has to prove the case and these cases being quasi- criminal in nature are to be proved on the basis of the principles of “preponderance of probabilities”, and not on the principles as being examined in the criminal case to prove the guilt of the accused beyond reasonable doubt. So far as other case cited by the learned counsel for the appellant i.e. Indus Airways Private Limited and Others Vs. Magnum Aviation Private Limited, (2014) 12 SCC 539 there was sufficiency of material on record to justify that the cheques were issued as advance payment for purchase of goods, and one of the terms and conditions of the contract was that the entire payment would be made to the supplier in advance. However, much within the time, the supplier complainant received the letter from the purchasers cancelling the purchase orders and requested the supplier to return both the cheques. The supplier pursuant thereto, sent response asking the purchasers as to when the supplier could collect the payment, and only thereafter, the suppler sent a legal notice to the purchasers and filed a complaint under Section 138 of the Act. In the given circumstances, it was observed by this Court that the complainant had failed even primafacie that there was a legally

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enforceable debt or other liability subsisting on the date of drawal of the cheque as contemplated under Section 138 of the Act. This judgment would not be of any help to the appellant in the instant case. 25. In the given circumstances, the High Court, in our view, has not committed any error in recording the finding of guilt of the appellant and convicting her for an offence being committed under Section 138 of the Act under its impugned judgment, which in our considered view, needs no further interference. Consequently, the appeals are without any substance, and are accordingly dismissed.

5 Crl.A.No.123/2021 dated:10.02.2021

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established, then these ‘reverse onus’ clauses become operative. such a situation, the obligation shifts upon the accused to discharge the presumption imposed upon him. This point of law has been crystalized by this Court in Rohitbhai Jivanlal Patel v. State of Gujarat10 in the following words: “In the case at hand, even after purportedly drawing the presumption under Section 139 of the NI Act, the trial court proceeded to question the want of evidence on the part of the complainant as regards the source of funds for advancing loan to the accused and want of examination of relevant witnesses who allegedly extended him money for advancing it to the accused. This approach of the trial court had been at variance with the principles of presumption in law. After such presumption, the onus shifted to the accused and unless the accused had discharged the onus by bringing on record such facts and circumstances as to show the preponderance of probabilities tilting in his favour, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of funds for advancing loan to the appellant accused…..” 15. Once the 2nd Appellant had admitted his signatures on the cheque and the Deed, the trial Court ought to have presumed that the cheque

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was issued as consideration for a legally enforceable debt. The trial Court fell in error when it called upon the Complainant Respondent to explain the circumstances under which the appellants were liable to pay. Such approach of the trial Court was directly in the (2019) 18 SCC 106, 18. teeth of the established legal position as discussed above, and amounts to a patent error of law.

6 2022 SCC Online SC 1131

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under Section 139 of the N.I. Act. As per Section 139 of the N.I. Act, it shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in Section 138 for discharge, in whole or in part, of any debt or other liability. Therefore, once the initial burden is discharged by the Complainant that the cheque was issued by the accused and the signature and the issuance of the cheque is not disputed by the accused, in that case, the onus will shift upon the accused to prove the contrary that the cheque was not for any debt or other liability. The presumption under Section 139 of the N.I. Act is a statutory presumption and thereafter, once it is presumed that the cheque is issued in whole or in part of any debt or other liability which is in favour of the Complainant/holder of the cheque, in that case, it is for the accused to prove the contrary. The aforesaid has not been dealt with and considered by the High Court. The High Court has also failed to appreciate that the High Court was exercising the revisional jurisdiction and there were concurrent findings of fact recorded by the courts below.

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KAMALA S Vs. VIDHYADHARAN M J7 and at paragraph Nos.15 and 16 it is held as under: 15. The Act contains provisions raising presumption as regards the negotiable instruments under Section 118(a) of the Act as also under Section 139 thereof. The said presumptions are rebuttable ones. Whether presumption stood rebutted or not would depend upon the facts and circumstances of each case. The nature and extent of such presumption came up for consideration before this Court in M.S. Narayana Menon Alias Mani V. State of Kerala and Anr. [(2006) 6 SCC 39] wherein it was held : "30. Applying the said definitions of "proved" or "disproved" to the principle behind Section 118(a) of the Act, the court shall presume a negotiable instrument to be for consideration unless and until after considering the matter before it, it either believes that the consideration does not exist or considers the non-existence of the consideration so probable that a prudent man ought, under the circumstances of the particular case, to act upon the

7 AIR 2007 SC (SUPP) 1142

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supposition that the consideration dos not exist. For rebutting such presumption, what is needed is to raise a probable defence. Even for the said purpose, the evidence adduced on behalf of the complainant could be relied upon." 16. This Court clearly laid down the law that standard of proof in discharge of the burden in terms of Section 139 of the Act being of preponderance of a probability, the inference therefor can be drawn not only from the materials brought on record but also from the reference to the circumstances upon which the accused relies upon. Categorically stating that the burden of proof on accused is not as high as that of the prosecution, it was held; "33. Presumption drawn under a statute has only an evidentiary value. Presumptions are raised in terms of the Evidence Act. Presumption drawn in respect of one fact may be an evidence even for the purpose of drawing presumption under another." It was further observed that ; "38. If for the purpose of a civil litigation, the defendant may not adduce any

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evidence to discharge the initial burden placed on him, a "fortiori" even an accused need not enter into the witness box and examine other witnesses in support of his defence. He, it will bear repetition to state, need not disprove the prosecution case in its entirety as has been held by the High Court. 39. A presumption is a legal or factual assumption drawn from the existence of certain facts."

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payment to concerned holder of cheque. His evidence either in no way rebut or falsify the case of the complainant. 35. Therefore, considering the entire evidence on record, it is evident that the complainant has satisfactorily proved by legally admissible evidence and discharged his initial burden that accused has borrowed Rs.12,00,000/- and in consideration of the same he has issued cheque and he did not repay the same and not replied the notice. On the other hand, the accused took false defence and which has no basis at all. 36. Learned ACMM by raising wrong points for consideration and without appreciating the ingredients of Section 138 of N.I. Act and considering the presumption and not discussing as to how the presumption is to be rebutted by the accused, has wrongly acquitted the accused. The judgment of acquittal passed by the learned ACMM being illegal, erroneous perverse needs to be set aside as held by Hon'ble Supreme Court in the catena of judgments rendered on cheque bounce cases.

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2) The judgment of acquittal dated 28.12.2011 passed in C.C.No.2427/2009 by the XII Additional Chief Metropolitan Magistrate, Bengaluru is hereby set aside. 3) The accused/respondent is convicted for the offences under Section 138 of N.I.Act and accused is sentenced to pay a fine of Rs.12,25,000/-. Out of the fine amount, a sum of Rs.12,00,000/- shall be paid as compensation to the complainant and a sum of Rs.25,000/- shall be deposited to the State as expenses of litigation. 4) In default of payment of fine, the accused shall undergo simple imprisonment for a period of one year. 5) Send back the records to the Trial Court. 4) No order as to costs.

Sd/- JUDGE

HJ List No.: 1 Sl No.: 33