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The Top Court has recently observed that statement of the accused recorded under Section 313 of the Criminal Procedure Code cannot absolve the accused of the charges under Section 138 of the Negotiable Instruments Act, 1881.
A Division Bench of Justice Indu Malhotra and Justice Ajay Rastogi, while upholding the judgment of the High Court observed that mere statement under Section 313 Code of Criminal Procedure, 1973, without any additional evidence to rebut the statutory presumption under Section 139 Negotiable Instruments Act, 1881, cannot absolve the accused of the charges under Section 138 of the Act.
“The statement of the accused recorded under Section 313 of the Code is not a substantive evidence of defence, but only an opportunity to the accused to explain the incriminating circumstances appearing in the prosecution case of the accused.” - Supreme Court of India
It was further added that since there is no evidence on record to rebut the presumption that the cheques were issued for consideration, the findings of the High Court are well reasoned, with no requirement of interference by the present Court.
Presumptions under the Negotiable Instruments Act, 1881
Section 118 Presumption as to negotiable instruments – Until the contrary is proved, the following presumptions shall be made:
(a) of consideration – that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration…
Section 139 Presumption in favour of holder – It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of then nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability.
“The object of introducing Section 138 and other provisions of Chapter XVII in the Act 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 the Act and the standard of proof was preponderance of probabilities,” the Bench noted.
Appellant had come against the judgment of Himachal Pradesh High Court, reversing the findings of the Trial Court Judge, holding appellant guilty under Section 138 NI Act, 1881.
Two cheques were issued by the appellant against delivery of certain goods on demand. Upon non-clearance, the complainant sent legal notices dated 29th October 2010 and 19th November, 2010.
Cause of Action arose when the Appellant neither responded nor made any payment in furtherance of the same.
The complainant in order to prove its case examined three witnesses and placed on record documentary evidences which were duly exhibited whereas the appellant only gave the statement under Section 313 CrPC, pleaded false implication and innocence.
Reliance was placed on Rangappa v. Sri Mohan, (2010) 11 SCC 441, Rohitbhai Jivanlal Patel v. State of Gujarat, (2019) 18 SCC 106, Uttam Ram v. Devinder Singh Hudan. (2019) 10 SCC 287.
Case Title: Sumeti Vij v. M/s Paramount Tech Fab Industries | CRIMINAL APPEAL NO. 292 of 2021
Statute/Provision involved: Section 118(a), 138, 139 Negotiable Instruments Act, 1881
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