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TMI Blog2024 (3) TMI 1389X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of Rs. 10 lakhs to the Opposite Party no.2 within two months from the date of the Order, in default, to suffer rigorous imprisonment of further two months. 2. The petitioner's case is that on September 26, 2006, the Opposite Party no. 2 herein filed a petition of complaint under Section 138 of the Negotiable instruments Act, 1881 (hereinafter referred to as 'NI Act') against the petitioner before the Court of the Learned Additional Chief Judicial Magistrate, Raghunathpur, Purulia. 3. On Completion of trial, the petitioner was convicted and sentenced as above. 4. Being aggrieved by and dissatisfied with the impugned Judgment and Order dated July 19, 2017 passed by the Learned Trial Magistrate, the petitioner herein filed an appeal under Section 374 of Cr.P.C. being Cri. Appeal No. 03 of 2017 before the Court of the Learned Additional Sessions Judge, Raghunathpur, Purulia (hereinafter referred to as 'Learned Appellate Court'). The said appeal was finally heard and disposed of by the Learned Appellate Court vide Order dated February 22, 2019 thereby affirming the Judgment and Order dated July 19, 2017 passed by the Learned Trial Magistrate. 5. The petitioner states that the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the complainant along with witness Nos. 2 and 3 had been to U.B.I. Raghunathpur Branch and there the accused/petitioner met him and informed that he is in dire need of Rs. 7,00,000/- (Seven Lacs) only for a couple of months for incidental expenses relating to his contemplated project. Complainant innocently believed such proposal of the accused and issued cheque no.951764 on his trade loan A/C for Rs.7,00,000/- in favour of the accused on 28.02.06. The accused withdrew the sum of Rs. 7,00,000/- and shortly thereafter accused approached the complainant for another sum of Rs. 1,45,000/- (one lac forty five thousand) in presence of witness Nos. 2 and 3. Complainant was hesitant to accede to such request of the accused by the latter repeatedly insisted with the complainant to arrange the sum and promised to repay the entire sum very shortly. The complainant accordingly gave Rs. 1,45,000/- to the accused in presence of witness nos. 2 and 3 in the early part of March, 2006. The accused thereafter started avoiding the complainant. However on 28.04.2006 the accused in discharge of his existing debts and liabilities had given the complainant at Raghunathpur a cheque bearing No. 99730 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal Procedure, 1973, which is a mandatory provision, no conviction can be recorded by the Learned Magistrate on the evidences partly recorded by his predecessor and partly by him. 21. It is further stated that:- a) The Company Shilabati Hospital Pvt. Ltd. has not been arraigned as accused in this case. b) The Cheque has been issued from the account maintained by the Company and under the seal of the Company. c) No notice under Section 138(b) of Negotiable Instruments Act, 1881 has been issued against the Company. d) The Petitioner i.e. sole accused has been implicated as director of the said company by invoking the principal of vicarious liability, for commission of an alleged offence which is allegedly committed by the Company. 22. The following Judgments have been relied upon by the petitioner:- (i) Aneeta Hada v. Godfather Travels & Tours (P) Ltd., (2012) 5 SCC 661. Para - 17, 56 to 60. (ii) Himanshu Vs. B. Shivamurthy and Anr. (2019) 3SCC 797, (Para 6, 12, 13, 14). (iii) Charanjit Pal Jindal Vs. L.N. Metalics (2015) 15 SCC 768 (Para 2, 4, 11 and 12). (iv) Mr. Raj Sahai Vs. The State of West Bengal & Anr. (CRR No. 100 of 2020). Para 28 to 30. (v) Mainuddin A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g arraigned as an accused, a complaint against the appellant was therefore not maintainable. The appellant had signed the cheque as a Director of the company and for and on its behalf. Moreover, in the absence of a notice of demand being served on the company and without compliance with the proviso to Section 138, the High Court was in error in holding that the company could now be arraigned as an accused." 30. The facts in the present case is very similar to the case, in Himanshu vs. B. Shivamurthy & Anr. (Supra). 31. In the present case:- a) The company has not been made an accused nor was any notice served upon the company, though the cheque was issued on behalf of the company. b) The petitioner has been made an accused as the person, who signed and issued the cheque. 32. Therefore, in the absence of the company being arraigned as an accused, a complaint against the petitioner is not maintainable Himanshu vs. B. Shivamurthy & Anr. (Supra). 33. The contention of the petitioner in respect of the cheque being issued not in discharge or debt or liability has been stressed upon. 34. In a proceeding under Section 138 N.I. Act, presumption is in favour of the Holder of the che ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ajashekar v. Augustus Jeba Ananth, (2020) 15 SCC 348, a two Judge Bench of this Court, of which one of us (D.Y. Chandrachud J.) was a part, reiterated the decision of the three Judge Bench of this Court in Rangappa v. Sri Mohan, (2010) 11 SCC 441, on the presumption under Section 139 of the NI Act. The court held: 12. Section 139 of the Act mandates that it shall be presumed, unless the contrary is proved, that the holder of a cheque received it, in discharge, in whole or in part, of a debt, or liability. The expression "unless the contrary is proved" indicates that the presumption under Section 139 of the Act is rebuttable. Terming this as an example of a "reverse onus clause" the three-Judge Bench this Court in Rangappa held that in determining whether the presumption has been rebutted, the test of proportionality must guide the determination. The standard of proof for rebuttal of the presumption under Section 139 of the Act is guided by a preponderance of probabilities. This Court held thus: "28. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch they rely. 25.4. That it is not necessary for the accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a persuasive burden. 25.5. It is not necessary for the accused to come in the witness box to support his defence." 13. It can thus be seen that this Court has held that once the execution of cheque is admitted, Section 139 of the N.I. Act mandates a presumption that the cheque was for the discharge of any debt or other liability. It has however been held that the presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities. It has further been held that to rebut the presumption, it is open for the accused to rely on evidence led by him or the accused can also rely on the materials submitted by the complainant in order to raise a probable defence. It has been held that inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely." 37. 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