RAJARAM S/O SRIRAMULU NAIDU (SINCE DECEASED) THROUGH L.RS. versus MARUTHACHALAM (SINCE DECEASED) THROUGH L.RS

Citation: [2023] 1 S.C.R. 809 · Decided: 18-01-2023 · Supreme Court of India · Bench: BHUSHAN RAMKRISHNA GAVAI · Disposal: Disposed off

Cited by 1 judgment(s) · cites 2 · see the full citation network in Lexace

Judgment (excerpt)

A
B
C
D
E
F
G
H
809
   [2023] 1 S.C.R. 809
RAJARAM S/O SRIRAMULU NAIDU (SINCE DECEASED)
THROUGH L.RS.
v.
MARUTHACHALAM (SINCE DECEASED) THROUGH L.RS.
(Criminal Appeal No. 1978 of 2013)
JANUARY 18, 2023
[B. R. GAVAI AND M. M. SUNDRESH, JJ.]
Money Lending – The appellant’s wife subscribed to chit funds
(1992 and 1995) with the respondent for which two signed blank
cheques were submitted as security – After maturity of the chit funds,
appellant and his wife sought release of the subscription amount –
However, respondent presented those cheques for encashment
without any intimation to appellant – Said cheques were
dishonoured as the appellant had closed the account – Respondent
filed two complaint cases u/s 138 of NI Act – Both cases were
dismissed by the trial Court – Thereafter, respondent filed suits for
recovery of money on the basis of the Promissory Notes –Both the
suits were dismissed – Appeals against the judgments in the criminal
matters were allowed by the High Court and order of conviction
and sentence was passed – Also, the suits were decreed by the High
Court – On appeal, held: Considering the criminal appeals first,
the trial court found that Income Tax Returns of the complainant
did not disclose that he lent amount to the accused, and that the
declared income was not sufficient to give loan of Rs. 3 lakhs –The
standard of proof for rebutting the presumption is that of
preponderance of probabilities – Applying this principle, the trial
Court had found that the accused had rebutted the presumption on
the basis of the evidence of the defence witnesses and attending
circumstances – In the instant case, the defence raised by the
appellant satisfies the standard of ‘preponderance of probability’ –
High Court was not justified in reversing the order of acquittal of
the appellant – Insofar as civil appeals are concerned, High Court
809
A
B
C
D
E
F
G
H
810
SUPREME COURT REPORTS
[2023] 1 S.C.R.
on basis of the evidence on record, relying on the preponderance
of probability, came to the conclusion that the plaintiff had the
financial ability to lend sum of Rs.3 lakhs – As the appellant’s wife
was not examined as witness, the High Court found that the best
available evidence was withheld by the defendants/appellants and
as such principle of adverse inference applicable – Therefore, no
reason to interfere with the judgments and the orders passed by the
High Court in civil appeals.
 Disposing of the appeals, the Court
HELD: 1. Consider the criminal appeals first, after analyzing
all these pieces of evidence, the Trial Court found that the Income
Tax Returns of the complainant did not disclose that he lent
amount to the accused, and that the declared income was not
sufficient to give loan of Rs.3 lakh. Therefore, the case of the
complainant that he had given a loan to the accused from his
agricultural income was found to be unbelievable by the Trial
Court. The Trial Court found that it was highly doubtful as to
whether the complainant had lent an amount of Rs.3 lakh to the
accused. The Trial Court also found that thecomplaint had failed
to produce the promissory note alleged to have been executed
by the accused on 25th October 1998. After taking into
consideration the defence witnesses and the attending
circumstances, the learned Trial Court found that the defence
was a possible defence and as such, the accused was entitled to
benefit of doubt. The standard of proof for rebutting the
presumption is that of preponderance of probabilities. Applying
this principle, the Trial Court had found that the accused had
rebutted the presumption on the basis of the evidence of the
defence witnesses and attending circumstances. In the present
case, this Court is of the considered opinion that the defence
raised by the appellant satisfies the standard of “preponderance
of probability”.The High Court was not justified in reversing the
order of acquittal of the appellant. [Paras 20, 25 and 27][819-E-
H; 820-G-H; 821-C]
A
B
C
D
E
F
G
H
811
2. A distinguishing fact between the criminal proceedings
and the civil proceedings in the present case is that, while in the
criminal proceedings the complainant had failed to produce the
promissory notes, in the civil proceedings, the complainant had
proved the promissory notes. The High Court found that the Civil
Appeals were required to be decided on the basis of the
preponderance of probabilities. The High Court found that the
complainant had established that he was working as a LIC Agent,
that his

Excerpt shown. Read the full judgment & AI analysis in Lexace.