Madan Lal Sawhney vs Sat Pal Gupta

Appellant Madan Lal Sawhneys complaint against Sat Pal Guptarespondent accusing him of having committed offence punishable under Section

138 of the Negotiable Instruments act, 1881, wherein he had accused him of having stopped payment of three cheques which he had issued to the

appellant for the amount he had borrowed from him, as a result whereof the Jammu and Kashmir Bank Lakhdata Bazar, Jammu had returned the

cheques to him unpaid, was dismissed by Judicial Magistrate 1st Class (Sub Judge), Jammu vide his order of November 24,2003.

Aggrieved by the dismissal of his complaint resulting in respondent's acquittal, the appellant has preferred this appeal after obtaining Special

Leave under Section 417 of the Criminal Procedure Code Svt. 1989.

Appearing for the appellant, Mr. V.R. Wazir submitted that the learned Magistrate had committed error in appreciating the appellants evidence

and relying heavily on the respondents evidence. Appellants evidence on the records was sufficient enough to entail respondents conviction under

Section 138 of the Negotiable Instruments Act, 1881, says the learned counsel.

Per contra, Mrs. Rozina Afzal submitted that respondents acquittal may not warrant interference in view of the law laid down by Hon'ble

Supreme Court of India in Bihari Nath Goswami v. Shiv Kumar Singh and ors, reported as (2004)9 SCC 186.

Referring to the evidence which the respondent had led in the trial court to support his plea that three cheques which had been issued by him to

the appellant in lieu of the paddy, which the later (sic) had to supply to him and payment whereof had been stopped in view of respondents

returning the paddy to the appellant on finding that the same was substandard, learned counsel urges that respondent had successfully proved his

defence and in the absence of any evidence to the contrary led by the appellantcomplainant, the well reasoned acquittal order recorded by learned

Judicial Magistrate would not warrant interference.

I have considered the submissions of learned counsel for the parties and gone through the records.

The evidence produced by the respondent before the trial Court indicates that he had justified his act of stopping payment of three cheques

which had been issued by him to the appellant when the paddy, in lieu whereof he had issued undated cheques, had been returned to the appellant

on its being found substandard. As against respondents evidence, the appellant had failed to prove by leading any evidence that the cheques issued

by the respondent to the appellant had been so issued for the discharge, in whole or in part, of any debt or other liability of the respondent

particularly when he had known about the respondents defence which he had taken right from the very beginning.

While appreciating the evidence led by the parties and dealing with it in view of the law laid down in various judgments of Hon'ble Supreme

Court of India, as mentioned in the order, learned Magistrate had held as follows:

Here in the present case, it appears that the accused has not played hide and seek in passing of direction to the banker for stoppage of payment to

the complainant Madan Lal Sawhney. He by writing a letter to the Chief General Manager J&K Bank Lakhdata Bazar, Jammu got stopped the

payment of cheques to the complainant. He has specifically referred the number and amount of the cheques along with the dates. It appears that

the complainant made an attempt to encash the cheques and accused however instructed for stoppage of the sa:rie. It is nothing on record which

can suggest that as to why the complainant has not presented the cheques for their encashment earlier. Averments in the complaint or otherwise

evidence available on record, nowhere suggest the reasons for nonpresentation of the cheques earlier to the date, they were presented in the bank.

Simultaneously, it appears the cheques were presented by the complainant and application was made by the accused for getting the stoppage of

payment. Here, it appears that the accused has not got the stoppage of payment just to avoid making of payment to the complainant as in the

present case, the development for the stoppage of the payment appears to have been taken place with the supply of the substandard paddy by the

complainant and after returning the same to him by the accused. There is sufficient, cogent, unambiguous and specific evidence which can prove the

arrangement of issuance of cheques for the purchase of the paddy by the accused from the complainant. There is further on record which can

suggest that same was returned back by the accused after finding the same as substandard. It does not appear that there was dishonest intention of

the accused in instructing the bank to slop the payment. His intention was not malafide to escape from his liability for making payment by directing

the bank for stoppage of payment. This is required to be proved, by the complainant in order to hold that accused is liable for the commission of

offence u/s 138 Negotiate Instrument Act, where he got stoppage of payment of cheques issued by the accused. This has been held in the AIR

1996 SC 2339 as discussed and referred hereinabove.

In view of the aforesaid, I hereby hold that the rebuttal evidence as led by the accused for proving that cheques were issued without any

consideration much less for amount referred, is sound, cogent, unambiguous and convincing. I have already referred hereinabove that accused has

every right to rebut the presumption that the cheques were issued without any consideration, as such the offence u/s 138 of Negotiable Instrument

Act is not made out and as such he is not liable for the same. I am forfeited of my aforesaid assumption from the citation as referred by the LC for

the complainant and the accused as discussed hereinabove. I further here hold that accused has discharge his liability in rebutting the evidence that

cheques were received by the holder/complainant under an agreement which was breached by him. In other words, it can be said that it has not

been proved by the complainant that the same were issued for the discharge of any debut or other liability. He has deposed in his statement before

the court that on 17.12.99, he has paid money in cash. In lieu of that accused issued three post dated cheques of amount one for Rs. 30,000/ and

two for Rs. 50,000/ each. However, no interest was agreed to be paid by the accused. Two were filled in English and one was filled in Urdu. It

can be gathered from the aforesaid statement of the complainant that he paid money on 17.12.99 and on the same day three post dated cheques

were issued. It is further not cleared that why two cheques were filled in English and one in Urdu. It is not digestable as to why the interest was not

agreed to be paid on the advanced amount.

However, the date referred by the complainant in his statement for advance of the amount is an afterthought as there is no any reference of the

same either in the demand notice issued by the complainant or in the averments of the complainant. The complainant was required to aver

specifically the detail, date and manner of making payment by him, to the accused when the accused has already take a defence that post dated

cheques were issued subject to the arrangement for supply of paddy, in the reply of the demand notice.

In view of the aforesaid, I hereby hold that the complainant has failed to prove the liability of the accused for payment of the sum as referred in the

complaint beyond all shadows of doubts. Furthermore, malafide and dishonest intention of the accused in getting the stoppage of the payment of

the cheques in favour of the complainant has not been proved beyond all reasonable doubts. Furthermore, ingredients of the offence u/s 138

Negotiable Instrument Act has also not otherwise been proved beyond all shadows of doubts. I have already referred hereinabove that rebuttal

evidence led by the accused is more convincing, cogent, unambiguous and as such is required to be believed and relied upon.

In view of the evidence which the parties had led before the trial court, no other view other than the one taken by the learned Magistrate may be

justified because the appellant had not led any evidence before the trial court to dislodge the defence which had been set up by the respondent.

I, therefore, do not find any ground to interfere with the well reasoned acquittal order recorded by learned Judicial Magistrate 1st Class (Sub

Judge), Jammu.

This appeal, therefore, lacks merit and warrants dismissal. Ordered accordingly.