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2018 (8) TMI 707

trial court found that although the respondent had not adduced any direct evidence, the material that came on record in cross-examination of the appellant was sufficient to support the defence of the respondent. - Held that:- the appellant was clearly able to establish existence of transactions between it and the respondent and further that the cheque in question was indeed issued in respect of purchase of items reflected in the bills. - There was no dispute about the fact that the signature on the cheque was that of the respondent. Therefore, the presumption under Sections 118 and 139 of the aforesaid Act operated in full force against the respondent. It has also come on record that the respondent neither sent any reply to the notice issued by the appellant on dischonour of the cheque, nor did he file any submissions or reply to the complaint filed by the appellant. The respondent also did not enter into the witness box to adduce any direct evidence to dispute the case sought to be made out by the appellant before the trial Court. - It is clear that the appellant was able to prove its case beyond reasonable doubt against the respondent and that the trial Court committ .....

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e witness box in support of his defence. He simply relied upon the material placed on record by the appellant and cross-examination of the witness who had appeared in support of the complaint before the trial Court. 5. The trial Court considered the evidence and material on record and it found that although the respondent had not adduced any direct evidence, the material that came on record in cross-examination of the appellant was sufficient to support the defence of the respondent. The trial Court found that although the appellant had specifically claimed in the complaint that the cheque in question was issued by the respondent for cosmetic items, the bills at Exhs. 19, 20 and 21 demonstrated that the items purchased by the respondent were not cosmetic and that they were electrical items like hair straightners. The trial Court further found that the appellant had failed to place on record documents pertaining to payment of octroi on the items sold, which also indicated that the defence of the respondent was probable. On this basis, the trial Court found that although presumption may have arisen against the respondent, he had been able to rebut the same on preponderance of probabi .....

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one of preponderance of probabilities. It is also clear that for rebutting the presumption, the accused need not necessarily adduce direct evidence and that he can do so even on the basis of the material brought on record by the complainant and by discrediting evidence of the witnesses appearing for the complainant. In this regard, the observations of the Hon'ble Supreme Court in the case of Rangappa .vs. Sri Mohan- (2010) 11 Supreme Court Cases 441 are relevant which reads as follows:- 27. Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such .....

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er 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 of the Act. 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 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 pre .....

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fact that the signature on the cheque was that of the respondent. Therefore, the presumption under Sections 118 and 139 of the aforesaid Act operated in full force against the respondent. It has also come on record that the respondent neither sent any reply to the notice issued by the appellant on dischonour of the cheque, nor did he file any submissions or reply to the complaint filed by the appellant. The respondent also did not enter into the witness box to adduce any direct evidence to dispute the case sought to be made out by the appellant before the trial Court. In this backdrop, the approach of the trial Court was clearly erroneous when it held that the respondent had been able to rebut the presumption that arose against him because it was brought on record that while the appellant stated in its complaint that the appellant used to sell cosmetic items to the respondent, the bills in question at Exhs. 19, 20 and 21 pertained to electrical items. This was nothing but hairsplitting and an approach which completely ignored the existence of the material on record showing transactions between the appellant and the respondent. In the cross-examination of the witness who appeared i .....

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