APS FOREX SERVICES PVT. LTD. versus SHAKTI INTERNATIONAL FASHION LINKERS & ORS.

Citation: [2020] 2 S.C.R. 811 · Decided: 14-02-2020 · Supreme Court of India · Bench: ASHOK BHUSHAN · Disposal: Appeal(s) allowed

Cited by 1 judgment(s) · cites 3 · see the full citation network in Lexace

Judgment (excerpt)

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 [2020] 2 S.C.R. 811
811
APS FOREX SERVICES PVT. LTD.
v.
   SHAKTI INTERNATIONAL FASHION LINKERS & ORS.
(Criminal Appeal No. 271 of 2020)
FEBRUARY 14, 2020
[ASHOK BHUSHAN AND M. R. SHAH, JJ.]
Negotiable Instruments Act, 1881 – s.139 – Presumption as
to legally enforceable debt or liability – Dishonour of four cheques
issued by accused – Fresh consolidated cheque issued – Dishonour
of the said cheque on presentation due to Stop Payment – Complaint
under s.138 – Admission of accused of issuance of cheque as well
as the signature on the cheque –  Acquittal by courts below – Appeal
by complainant – Plea of original accused that cheque was issued
towards the security and the complainant misused the cheque –
Held: The issuance of cheque by the accused and the signature of
the accused on the said cheque were not disputed by the accused –
The accused also not disputed that there were transactions between
the parties – Even as per the statement of the accused, which was
recorded at the time of the framing of the charge, he admitted that
some amount was due and payable – In the reply to the statutory
notice, no plea was taken by accused that the cheque was given by
way of security – The cheque in question was issued for the second
time – Therefore, once the accused admitted the issuance of cheque
which bore his signature, there was presumption that there existed a
legally enforceable debt or liability under s.139 Act – However,
such a presumption is rebuttable in nature and the accused is
required to lead the evidence to rebut such presumption – The
accused was required to lead evidence that the entire amount due
and payable to the complainant was paid – The story put forward
by the accused that the cheques were given by way of security not
believable in absence of further evidence to rebut the presumption
and more particularly the cheque in question was issued for the
second time, after the earlier cheques were dishonoured – Both, the
trial court as well as High Court, committed error in shifting the
burden upon the complainant to prove the debt or liability, without
appreciating the presumption under s.139 of N.I. Act – Order of
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SUPREME COURT REPORTS
[2020] 2 S.C.R.
acquittal is set aside – Respondents are guilty for the offence under
s.138 of the Act.
Negotiable Instruments Act, 1881 – s.139 – Presumption
under – s.139 of the Act is an example of reverse onus clause and,
therefore, once the issuance of the cheque is admitted and even the
signature on the cheque is admitted, there is always a presumption
in favour of the complainant that there existed legally enforceable
debt or liability and thereafter it is for the accused to rebut such
presumption by leading evidence.
Negotiable Instruments Act, 1881 – s.139 – Financial
capacity of the complainant – When the accused questions the
financial capacity of the complainant in support of his probable
defence, despite the presumption under s.139 of the Act about the
presumption of legally enforceable debt and that such presumption
is rebuttable, the onus shifts on the complainant to prove his financial
capacity and at that stage the complainant is required to lead the
evidence to prove his financial capacity, more particularly when it
is a case of giving loan by cash and thereafter issuance of a cheque
– In the instant case, the accused never questioned the financial
capacity of the complainant.
Allowing the appeals, the Court
HELD:  1. It was the case on behalf of the accused that the
cheque was given by way of security and the same was misused
by the complainant. However, nothing is on record that in the
reply to the statutory notice it was the case on behalf of the
accused that the cheque was given by way of security. Earlier the
accused issued cheques which came to be dishonoured on the
ground of ‘insufficient funds’ and thereafter a fresh consolidated
cheque was given which has been returned unpaid on the ground
of “STOP PAYMENT”. Therefore, the cheque in question was
issued for the second time. Therefore, once the accused has
admitted the issuance of cheque which bears his signature, there
is presumption that there exists a legally enforceable debt or
liability under Section 139 of the N.I. Act. However, such a
presumption is rebuttable in nature and the accused is required
to lead the evidence to rebut such presumption. The accused
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was required to lead evidence that the entire amount due and
payable to the complai

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