TMI Blog2019 (8) TMI 310X X X X Extracts X X X X X X X X Extracts X X X X ..... e account being maintained by the respondent No.2 (appellant therein) and is about the balance which got forwarded on 1.4.2009 and cash entry of ₹ 5000/-, dated 2.6.2009, and even if the said document is deemed to be correct, the said payment of ₹ 5000/- on 2.6.2009 does not extend the period of limitation since the cash payment was made after the expiry of the period of limitation - Though, it is correct that once the signatures are admitted on the cheque, existence of legally enforceable debt or liability has to be presumed, but it is to be noted that the said presumption is rebuttable and in the instant matter, the respondent No.2 has been able to rebut the said presumption by showing that the liability for payment against the goods supplied arose in July 2005 and the limitation to file the case on the said liability expired in July 2008. It is well settled that the presumption, which is contained in Section 139 of the NI Act, only raises the presumption that the cheque has been issued for the discharge of a debt or liability and existence of legally recoverable debt is not a matter of presumption. The Appellate Court has rightly held that the alleged responsib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espondent No.2 did not make the payment, and hence a complaint under Section 138 of the NI Act was filed by the petitioners. 5. The Trial Court, after hearing both the parties, vide judgment dated 11.07.2012 convicted the respondent No.2 for committing the offence under Section 138 of the NI Act. 6. The Trial Court, vide its judgment dated 11.07.2012, observed that the respondent No.2 had admitted his signatures on the cheque as well as the issuance of the cheque to the petitioner No.2. However, it was the stand of respondent No.2 that the said cheque was handed over to the petitioner No.2 for the purpose of opening of an account and not against the discharge of any liability. In this regard, the petitioner no.2 was cross-examined, but no defence evidence was led by the respondent No.2. The Trial Court held that the cross-examination of the petitioner No.2 was unimpeached and the respondent No.2 had failed to establish that his bank account was opened by the petitioner No.2. Further, it was held by the Trial Court that once the signatures are admitted on the cheque, existence of legally enforceable debt or liability has to be presumed and further, as the responden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... existence of a legally enforceable debt or liability, the prosecution can fail, as per the language of Section 139 of the NI Act. Accordingly, the Appellate Court, following the ratio laid down in the judgments titled as Rangappa v. S. Mohan, (2010) 11 SCC (441), Vijay Polymers Pvt. Ltd. Anr. v. Vinnay Aggarwal, 2009 (110) DRJ 592 and Kamalaksha Laxman Prabhu v. S.G. Mayekar, 2009 (1) DCR 426 allowed the appeal filed by the respondent No.2 and set aside the judgment of conviction and the order on sentence passed by the Trial Court. 11. Aggrieved by the aforesaid impugned order passed by the Appellate Court, the petitioners have preferred the present revision petition. 12. I have given my thoughtful consideration to the submissions of the learned counsel for the parties and have also gone through the written submissions filed by them as well as the judgments relied upon by them. 13. It is contented by the learned counsel for the petitioners that the Appellate Court had failed to appreciate the fact that where the accused has not disputed his signature on the dishonoured cheque in question, it constitutes an agreement and/or promise by the debtor to p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y Aggarwal (supra) and the judgment of the Bombay High Court in the case titled as Kamalaksha Laxman Prabhu v. S.G. Mayekar (supra). 21. The learned counsel for the respondent No.2 vehemently contended that the petitioners had based and substantiated their case on the afore-mentioned bills bearing nos. 5419 and 5442 in their complaint, but neither the petitioners had placed on record the afore-mentioned bills nor there is any mentioning of the consideration of the said bills in the complaint. 22. It is lastly contended by the learned counsel for the respondent No.2 that the petitioners has failed to place on record any evidence to show that any demand of payment was raised against the respondent No.2 during the duration of 4 years, i.e. from the date of the transaction till the alleged issuance of the cheque in question. 23. In light of the above submissions of the learned counsel for the parties, it would be appropriate and necessary to first reproduce the provisions of Section 138 of the NI Act, which read as under: 138. Dishonour of cheque for insufficiency, etc., of funds in the account - Where any cheque drawn by a person on an ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the writing containing the acknowledgment is undated, oral evidence may be given of the time when it was signed; but subject to the provisions of the Indian Evidence Act, 1872 (1 of 1872), oral evidence of its contents shall not be received. Explanation .-For the purposes of this section,- (a) an acknowledgment may be sufficient though it omits to specify the exact nature of the property or right, or avers that the time for payment, delivery, performance or enjoyment has not yet come or is accompanied by a refusal to pay, deliver, perform or permit to enjoy, or is coupled with a claim to set off, or is addressed to a person other than a person entitled to the property or right, (b) the word signed means signed either personally or by an agent duly authorised in this behalf, and (c) an application for the execution of a decree or order shall not be deemed to be an application in respect of any property or right. 25. A bare perusal of the aforesaid provision clearly goes on to show that for analyzing the limitation of a liability beyond a period of three years, the acknowledgment, if any, must be there before the period o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n held by another Coordinate Bench of this Court that, an acknowledgment to be encompassed within the ambit of Section 18 of the Limitation Act has to be an acknowledgment in writing as also within the prescribed period of limitation. These are the twin requirements which have to be fulfilled in order to be a valid acknowledgment under Section 18 of the Limitation Act. Relevant portion of the aforesaid judgment is reproduced hereunder: 10. This acknowledgment even as per the complaint was much after the statutory period of three years which is the prescribed period of limitation for the recovery of an outstanding amount. An acknowledgment to be encompassed within the ambit of Section 18 of the Limitation Act has to be an acknowledgment in writing as also within the prescribed period of limitation. These are the twin requirements which have to be fulfilled in order to be a valid acknowledgment under Section 18 of the Limitation Act which is admittedly not so in the instant case. In this case this acknowledgment to pay the balance amount was in terms of the settlement dated 26.1.2005 i.e. much after the statutory period of three years; it also does not speak of the acknowl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is contained in Section 139 of the NI Act, only raises the presumption that the cheque has been issued for the discharge of a debt or liability and existence of legally recoverable debt is not a matter of presumption, as per the aforesaid provisions of law. 32. The Supreme Court, in Krishna Janardhan Bhat vs. Dattatraya G. Hedge, (2008) 4 SCC 54 , has elucidated the law in this regard and has held as under: 30. The proviso appended to the said section provides for compliance of 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. 43. But, we may at the same time notice the development of law in this area in some jurisdictions. 44. The presumption of innocence is a human right. [See Narender Singh and Anr. v. State of M.P.: 2004 CriLJ 2842, Ranjitsing Brahmajee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion has been inserted to regulate the growing business, trade, commerce and industrial activities of the country and the strict liability to promote greater vigilance in financial matters and to safeguard the faith of the creditor in the drawer of the cheque which is essential to the economic life of a developing country like India. This, however, shall not mean that the courts shall put a blind eye to the ground realities. Statute mandates raising of presumption but it stops at that. It does not say how presumption drawn should be held to have rebutted. Other important principles of legal jurisprudence, namely presumption of innocence as human rights and the doctrine of reverse burden introduced by Section 139 should be delicately balanced. Such balancing acts, indisputably would largely depend upon the factual matrix of each case, the materials brought on record and having regard to legal principles governing the same. 33. Therefore, I do not agree with the contention raised by the learned counsel for the petitioners that the Appellate Court has misinterpreted Section 139 of the NI Act. The Appellate Court has rightly held that the alleged responsibility of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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