Madhab Kumar Paul vs Ashim Kumar Dutta & Ors.

Rajarshi Bharadwaj, J.

This appeal arises out of the judgement and order dated 23rd February, 2009 passed by learned Metropolitan Magistrate, 6th Court, Calcutta in Case

No. C/802/00/T.R./761/00, whereby the learned Magistrate acquitted the accused persons of the charge under Section 138 of the Negotiable

Instruments Act, 1881.

The fact of the case is that the appellant was the lessee in respect of “Bhutnath Medical Hallâ€. The deed of lease was registered and thereafter,

the respondents/accused persons renewed the said deed of lease. The accused persons/respondents approached the appellant to hand over the said

Medical Hall and a settlement was being made which was reduced in the form of a deed on 27th July, 2000 in respect of the equipment of the drug

shop. As per the deed of settlement the keys of the medicine shop was handed over in lieu of Rs. 1,50,000/- and a cheque of Rs. 1,50,000/- drawn on

Standard Chartered Bank, Netaji Subhas Road Branch was issued in favour of the complainant/appellant. When the said cheque was presented

before the Central Bank of India, Hathkhola Branch on 28th July, 2000, the same was returned with remarks “Payment Countermandedâ€​ and also

“Stop Paymentâ€. Thereafter, a demand notice issued by a lawyer was sent by registered post with acknowledgement due on 9th August, 2000

and the said notice was replied by a Solicitor vide letter dated 17th August, 2000. Hence, the complainant/appellant prayed for prosecution under

Section 138 of the Negotiable Instruments Act, 1881 before the learned Metropolitan Magistrate, 6th Court, Calcutta, which was numbered as

Reference no. C/802/00/TR/761/00.

It may be noted that Dr. Bholanath Pal was erroneously arraigned as respondent no.3 in this appeal. However, the respondent no.3 could not be made

a party in the instant appeal, as the learned Magistrate was pleased to discharge the respondent no.3 from the instant case. Mr. Narayan Prasad

Agarwala, learned advocate appearing for the appellant as amicus curiae has submitted that though the prosecution witnesses categorically established

the case, yet the learned Magistrate acquitted the accused/respondents from the offence, which is not in accordance with law.

He has further submitted that the learned Magistrate was absolutely wrong in holding that under section 139 of the Negotiable Instruments Act, initial

burden would lie on the complainant/appellant, whereas initial burden would lie on the accused persons. Lastly, he has submitted that the learned

Magistrate ought to have considered the offence committed by the accused persons under Section 138 of the Negotiable Instruments Act, 1881 and

accordingly, the learned Magistrate ought to have convicted the accused persons/respondents in accordance with law. Learned advocate for the

appellant has prayed for setting aside the order of acquittal dated 23rd February, 2009.

Per contra, Mr. Ayan Bhattacharya, learned advocate appearing for the respondents has submitted that though the respondent nos. 1 and 2 did not

adduce any witnesses, but cross-examined the prosecution witnesses and got several documents exhibited by way of cross-examination. He has

further argued that the learned Magistrate while passing the order impugned, had relied on a decision of the Supreme Court in the case of Krishna

Janardhan Bhat â€"vs-Dattatraya G. Hegde reported in (2008) 4 SCC 54, wherein it was held that â€" “The proviso appended to the said section

provides for compliance with 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 under Section 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.â€​

Mr. Bhattacharya further submitted that the law declared in Krishna Janardhan (supra) was subsequently overruled by a Larger Bench of the Apex

Court in the case of Rangappa â€"vs- Sri Mohan reported in (2010) 11 SCC 441. The Apex Court has held in paragraph 26 thereof as follows:

“In light of these extracts, we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed

include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat may not be

correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and

circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a

defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial

presumption which favours the complainant.â€​

Mr. Bhattacharya has prayed that in view of the decision of the Hon’ble Supreme Court, the matter may be remanded back to the learned

Magistrate for fresh consideration and the respondent nos. 1 and 2 may be granted opportunity to advance their arguments on every possible aspect

before the learned Magistrate. After hearing the learned advocates for the parties and after perusing the order impugned, it appears that the learned

Metropolitan Magistrate while passing the order has relied upon the decision of the Apex Court in the case of Krishna Janardhan Bhat (supra), which

has been subsequently overruled by a Larger Bench of the Apex Court in the case of Rangappa â€"vs- Sri Mohan (supra), wherein law has been

amplified by various decisions of the Apex Court.

Therefore, the order dated 23rd February, 2009 passed by the learned Metropolitan Magistrate is thus quashed and set aside and the matter is

remanded back to the learned Metropolitan Magistrate, 6th Court, Calcutta for deciding afresh in the light of the observation of the Apex Court in the

case of Rangappa-vs- Sri Mohan reported in (2010) 11 Supreme Court Cases 441 reversing the judgement of the Apex Court in the case of Krishna

Janardhan Bhat â€"vs- Dattatraya G. Hegde reported in (2008) 4 Supreme Court Cases 54.

Accordingly, the appeal, being CRA 366 of 2010, is disposed of. Copy of the judgment along with LCR be sent down to the trial Court at once for

necessary compliance. Urgent Photostat Certified copy of this order, if applied for, be supplied expeditiously after complying with all necessary legal

formalities.