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2017 (1) TMI 1265 - MADRAS HIGH COURT

2017 (1) TMI 1265 - MADRAS HIGH COURT - TMI - Case under Section 138 of the Negotiable Instruments Act, 1881 - 'Burden of Proof' - Held that:- A perusal of the complaint (filed by the Appellant / Complainant) before the trial court shows that the entire complaint is conspicuously silent as to the quantum of the interest agreed to be paid by the Respondent / Accused. Ordinarily, if a person lends money and that too a higher amount like ₹ 3,00,000/- then, the said amount will carry some perc .....

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stances in his favour. - In view of the aforesaid detailed qualitative discussions, also this Court taking note of the attendant facts and circumstances of the instant case in a conspectus fashion and also by considering the defence taken on behalf of the Respondent / Accused comes to an inevitable and irresistible conclusion that the Respondent / Accused had raised some probable defences in the present case. In fact, the Appellant / complainant had not established his case under Section 138 .....

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rate (FTC, Magisterial Level), Tirchengode) while passing the impugned Judgment in STC No.395 of 2012 on 26.06.2013 at Paragraph Nos.47 to 49 had clearly observed the following: 47.In this case, the evidence on record makes it abundantly clear that the accused has proved the defence taken by him by preponderance of probabilities. Inference of preponderance of probabilities can be drawn not only from the materials brought on records by the parties but also by reference to the circumstances upon w .....

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ved. More than that the very issuance of cheque in favour of the complainant itself has not been proved and so, none of the presumption as completed in the act can be raised in this case. 49. Merely basing reliance on the fact that the accused admitted his signature in Ex.P.1, Cheque and in spite of receipt of legal notice, the amount has not been repaid and the same has been spoken by P.W.1, accused can not be found guilty. and finally opined that the Appellant / Complainant had failed to disch .....

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Court had committed an error in acquitting the Respondent / Accused which is against law, weight of evidence and probabilities of the case. 4. The Learned Counsel for the Appellant urges before this Court that the trial court erred in dismissing the complaint filed by the Appellant for the reason that he was not an Income Tax Assesee. 5. Continuing further, the Learned Counsel for the Appellant takes a plea that the trial court had wrongly held that the Appellant / Complainant had not establishe .....

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ture of the cheque was not disputed, the presumption in Law is that the Respondent / Accused had issued the cheque and in short the Respondent / Accused is to rebut the presumption without sufficient evidence. However, these aspects were not looked into by the trial court in a proper and real perspective. 8. The Learned Counsel for the Appellant takes a emphatic stand that the trial court was not correct in acquitting the Respondent / Accused based on the reason that the Appellant / Complainant .....

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ome Tax) was not a 'Legally Enforceable Debt'. 10. By way of reply, it is the contention of the Learned Counsel for the Respondent / Accused that the trial court had rightly observed in its Judgment that the Appellant / Complainant had not established the execution of cheque by the Respondent / Accused in his favour and also the fact that the cheque was issued for a 'Legally Recoverable Debt' and in the instant case, the trial court went on to observe in its Judgment that the  .....

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N.I.Act before the trial court) that the Respondent / Accused is known to the Appellant as friend for the past several years and that he borrowed a sum of ₹ 3,00,000/- from him on 25.02.2011 as 'Hand Loan' (for his Urgent Family and Business Expenses) and issued a post dated cheque on 29.03.2011 to him to Discharge the 'Legally Enforceable Debt' . 12. The clear cut stand of the Appellant / Complainant is that he deposited the cheque No.088715 drawn at IDBI Bank Limited, Ero .....

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cheque and demanded the payment of cheque amount within 15 days from the date of receipt of the notice through his Counsel. The said notice was received on 18.04.2011. In fact the Respondent / Accused had given a Ex.P.5, Reply Notice dated 30.04.2011 which contained false version. Inasmuch as the Respondent / Accused had not paid the outstanding amount due to the Appellant / Complainant or to pay the amount of cheque issued by him because of the reason that the cheque got dishonoured, a complai .....

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riculture and Electric power Loom' and per year through agriculture he was getting an approximate profit of ₹ 5,00,000/- and through Electric Power Loom Business, as his share, per year he was getting a profit of ₹ 10,00,000/- and that he is not paying any licence amount towards the running 'Electric Power Loom Business' or for his income he is not paying the Income Tax. 16. P.W.1 proceeds to state in his evidence (in Cross examination) that in Ex.D.14 Receipt dated 27.11 .....

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the latter had informed that he would pay a sum of ₹ 25,000/- and would pay the balance amount in installment and that on 27.11.2011, the afore stated settlement talk was held. 17. D.W.1 (the Respondent / Accused) in his evidence (Cross-Examination) had stated that it was correct to state that Ex.P.1- Cheque was issued in his name in respect of his Bank Account and the signature in the said cheque belong to him and further that in the Police Station his uncle, Anbazhagan on his behalf gav .....

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Shri Ganapathy Finance at the Erode address and the Appellant / Complainant had utilised the said cheque and it filed the present complaint. 18. D.W.1 in his evidence had also stated that he was ready to prove his case by examining the officials of Tamirabarani Electronics, Ganapathi Finance and Ex.D.12 was the receipt to show the payment of Rs.2,800/- towards first instalment to the Tamirabarani Electronics. 19.D.W.2 in his evidence (Bank Manager) had deposed that in his IDBI Bank at Erode, th .....

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and on 11.02.2011 another cheque containing cheque leaf bearing No.839906 was given and Ex.D.13 was the Account Ledgerr computer true copy and since the initial cheque book (containing cheque leaves) were over, based on the letter, again the cheque book was issued. 20. At this juncture, a mere running of the contents of Ex.P.3 Lawyers Notice addressed to the Respondent / Accused indicates that a sum of ₹ 3,00,000/- was borrowed from the Appellant (Complainant) on 25.02.2011 for Respondent .....

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s reply notice dated 30.04.2011 issued on behalf of the Respondent / Accused) addressed to the Appellant / Complainant's Counsel points out among other things that the execution of the alleged cheque in favour of the Appellant was denied and that apart it was mentioned that the Appellant / Complainant is doing money lending business and he is in the habit of taking signature of his customers in blank cheques and promissory notes. Apart from that, it was also stated in the Ex.P.5, Reply Notic .....

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the Respondent / Accused and further that he does not whether the Respondent / Accused is carrying on any other business other than Sangameswarar Dyes Business. D.W.1 ( the Respondent / Accused) in his evidence had stated that he does not know about the Appellant / Complainant as to who he is and further that he is a total stranger. Moreover P.W.1 (Appellant) in his evidence had stated that he was ready to file necessary documents to show that he was receiving an annual income of ₹ 15,00,0 .....

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r purchasing Refrigerator on 17.03.2010 through his friend viz., Mohankumar. In fact, the Respondent / Accused had purchased the Refrigerator from Tamiraparai Electronics by paying initial sum of ₹ 2,800/- and for the balance amount, he had obtained loan amount from Ganapathy Finance in which the Respondent / Accused namely, Mohan Kumar had stood as Guarantor for the loan amount in question. 25. Added further, it is crystalline stand of the Respondent / Accused that he had issued Cheque No .....

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e Respondent / Accused is that in the instant case, there is no 'Legally Recoverable Debt' as averred by the Appellant / Complainant. 27.It cannot be gainsaid that the presumption envisaged under Section 139 of Negotiable Instruments Act, 1881 is a rebuttable presumption. As a matter of fact, 'Burden of Proof' is not 'Static'. If the initial 'Onus' is discharged by the Appellant / Complainant, then, it is for the Respondent / Accused to produce rebuttal evidence, .....

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30. Suffice it for this Court to point out that the Appellant / Complainant before the trial court had not established that he had the necessary resources / wherewithal to lend the purported sum of ₹ 3,00,000/- to the Respondent / Accused. To put it precisely, P.W.1 (in his cross-examination) had stated that he is not an Income tax assessee. 31. A perusal of the complaint (filed by the Appellant / Complainant) before the trial court shows that the entire complaint is conspicuously silent a .....

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