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2015 (11) TMI 1873 - HC - Indian LawsDishonor of Cheque - acquittal of the accused - main contention of revision petitioner is that part payment of the debt amount under the cheque was paid to the payee and he has not made any endorsement of that part payment in the cheque - if the debt amount is less than the cheque amount whether any offence under Section 138 will be attracted against the revision petitioner? HELD THAT:- According to Section 138 of the N.I. Act, where any cheque drawn by a person on an account maintained by him with a bank for payment of any money to another person from, out of that account, for the discharge of any debt or liability, in whole or in part is returned by the bank, on the ground that the amount in that account is insufficient to honour the cheque or it exceeds the amount arranged to be paid from that account by an agreement made with a bank, such person shall be deemed to have committed an offence under Section 138 of the N.I. Act. This deemed provision is subject to the statutory condition that the cheque has to be presented within the statutory period in which it is drawn or within the period of its validity - The facts of the case show that the amount covered by the cheque is bigger than the cheque amount. A reading of the wordings of the Section shows that the cheque should be given in discharge of a debt either in whole or in part or any liability and if the cheque amount is higher than the debt or liability, Section 138 of the N.I. Act would not get attracted. The presumption of law is that a person is innocent until proved guilty. This means that there is always a presumption of innocence in favour of an accused and the burden to prove the case is on the prosecution. That presumption is available to an accused who is prosecuted under Section 138 of the Negotiable Instruments Act, simply because a cheque happened to be dishonoured itself is not a ground to say that the accused has committed an offence. There may be exceptional cases out side the purview of the Section 138. A debt is a liquidated amount of money owed and payable to another in present or in future which is a pecuniary liability recoverable by action in respect of money or demand. Therefore, Section 138 of the N.I. Act shows not only the debt, but also the liability. A cheque have been issued in discharge of a debt wholly or in part or of any liability. The indorsement for part payment of the cheque was explained under Section 56 of the N.I. Act. According to Section 56 of the Negotiable Instruments Act, "no writing on a negotiable instrument is valid for the purpose of negotiation, if such writing purports to transfer only a part of the amount appearing to be due on the instrument; but where such amount has been partly paid a note to that effect may be indorsed on the instrument, which may then be negotiated for the balance". The sections prohibit the transfer of an instrument for a portion of the amount due under it - When Court considers part payment due under a cheque and if drawee makes an endorsement regarding the part payment on the instrument and he claims the balance amount by presenting the cheque for encashment through a Bank and if it is dishonoured, then an offence under Section 138 of the N.I. Act will be made out. Both the Courts below failed to appreciate the admission made by PW 1 and the documentary evidences which resulted in miscarriage of justice. Here the portion of the cheque was repaid and such payment is admitted by PW1 and no endorsement was made on the back of the cheque or face thereof and on prosecution complainant claimed cheque amount, no offence under Section 138 of the N.I. Act is made out. The evidence adduced in this case is not sufficient to convict the accused under Section 138 of the N.I. Act. The conviction and sentence passed by the Court below under Section 138 of the N.I. Act are set aside and revision petitioner is acquitted - Application disposed off.
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