LexSUMETI VIJ versus M/S PARAMOUNT TECH FAB INDUSTRIES
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A B C D E F G H 266 SUPREME COURT REPORTS [2021] 2 S.C.R. [2021] 2 S.C.R. 266 266 SUMETI VIJ v. M/S PARAMOUNT TECH FAB INDUSTRIES (Criminal Appeal No(s). 292 of 2021) MARCH 09, 2021 [INDU MALHOTRA AND AJAY RASTOGI, JJ.] Negotiable Instruments Act, 1881 – s.138 – Order placed by the accused-appellant – Delivered – Cheque issued by the appellant in the name of complainant-respondent – Returned on presentation with a note of “insufficient funds” in the account of appellant – Notices sent by respondent – Neither responded to nor any payment made within the statutory period – Complaints filed by the respondent u/s.138 – Finding of acquittal returned by Trial Court – Reversed by High Court – Held: Appellant has only recorded her statement u/s.313, CrPC and has not adduced any evidence to rebut the presumption that the cheques were issued for consideration – Facts remained unrebutted and supported with the evidence on record – Appellant rightly convicted by High Court – Code of Criminal Procedure, 1973 – s.313. Negotiable Instruments Act, 1881 – Chapter XVII; s.138 – Object of introduction – Discussed. Negotiable Instruments Act, 1881 – s.139 – Scope of – Discussed. Dismissing the appeals, the Court HELD: 1.1 The object of introducing Section 138 and other provisions of Chapter XVII in the Negotiable Instruments Act, 1881 appears to be to enhance the acceptability of cheques in the settlement of liabilities. The drawer of the cheque be held liable to prosecution on dishonour of cheque with safeguards provided to prevent harassment of honest drawers. Section 138 primarily relates to a civil wrong and the amendment made in the year 2000 specifically made it compoundable. The burden of proof was on the accused in view of presumption under Section 139 of A B C D E F G H 267 the Act and the standard of proof was of “preponderance of probabilities”. There is a mandate of presumption of consideration in terms of the provisions of the Act and the onus shifts to the accused on proof of issuance of cheque to rebut the presumption that the cheque was issued not for discharge of any debt or liability in terms of Section 138 of the Act. [Paras 13, 14][272-D-E; 237-A-B] 1.2 The scope of Section 139 of the Act is that when an accused has to rebut the presumption, the standard of proof for doing so is that of “preponderance or probabilities”. The proceedings under Section 138 of the Act are quasi-criminal in nature, and the principles which apply to acquittal in other criminal cases are not applicable in the cases instituted under the Act. Likewise, under Section 139 of the Act, a presumption is raised that the holder of a cheque received the cheque for the discharge, in whole or in part, of any debt or other liability. To rebut this presumption, facts must be adduced by the accused which on a preponderance of probability (not beyond reasonable doubt as in the case of criminal offences), must then be proved. [Paras 15- 17][274-A-B; G-H; 275-A-B] 1.3 In the case at hand, the complainant was able to prove that the appellant placed the order for purchasing non-woven fabric which was sold vide invoices amounting to Rs.5,07,062/- and Rs.5,10,000/- which was delivered through public carrier trucks and in lieu thereof, the cheques in favour of the complainant were issued by appellant in order to discharge her liability. On the cheques being presented for encashment, the same were dishonoured on the ground of “insufficient funds” in the account of the appellant and the same were returned. That apart, when the complainant exhibited documents in support of his complaints and recorded the statement of three witnesses in support thereof, the appellant has recorded her statement under Section 313 of the Code, but failed to record evidence to disprove or rebut the presumption in support of her defence available under Section 139 of the Act. The appellant has not adduced any evidence to rebut the presumption that the cheques were issued for consideration. The statement of the accused recorded under Section 313 of the Code is not a substantive evidence of defence, SUMETI VIJ v. M/S PARAMOUNT TECH FAB INDUSTRIES A B C D E F G H 268 SUPREME COURT REPORTS [2021] 2 S.C.R. but only an opportunity to the accused to explain the incriminating circumstances appearing in the prosecution case of the accused. The High Court has not committed any error in recording the finding of guilt of the appellant and convicting her for an offence being committed under Section
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