# Ranjit v. State of U.P. & Anr

- **Citation:** Application U/S 482 No. 47282 of 2019
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2020-01-31
- **Case number:** Application U/S 482 No. 47282 of 2019
- **Bench:** Mrs. Manju Rani Chauhan
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/ranjit-v-state-of-u-p-anr-46212
- **Pages:** 17

## Headnote

Criminal Law-Complainant alleges that
Applicant
owes
some
money-for
repayment Applicant gave a chequeto
Complainant-cheque
was
returned
by
bank for insufficient balance-no evidence
was led by Applicant nor its prima facie
that any fraud exist -bank has also not
made any remarkon the return memo-no
illegality in the orders passed by Court
below-Application dismissed. (E-9)

Cases Cited:

## Text

_Characters 0–39,846 of 57,967. This is a partial read: ask again with offset=39846 for what follows._

1752 INDIAN LAW REPORTS ALLAHABAD SERIES
interference only when the complaint did
not disclose any offence or was frivolous
vexatious or oppressive" as well as in the
case of State of Bihar v. Murad Ali
Khan, (1989) Cr LJ 1005: AIR 1989 SC
1, Apex Court propounded "In exercising
jurisdiction under Section 482 High Court
would not embark upon an enquiry whether
the allegations in the complaint are likely
to be established by evidence or not".

13. Meaning thereby, exercise of
inherent jurisdiction under Section 482
Cr.P.C. is within the limits, propounded as
above.

14. In view of what has been
discussed, hereinabove, this Application,
being devoid of merits, merits dismissal
and it stands dismissed as such.
----------
(2020)03-05ILR A1752
ORIGINAL JURISDICTION
CRIMINAL SIDE
DATED: ALLAHABAD 31.01.2020

BEFORE
THE HON'BLE MRS. MANJU RANI
CHAUHAN, J.

Application U/S 482 No. 47282 of 2019

Ranjit ...Applicant
Versus
State of U.P. & Anr. ...Opposite Parties

Counsel for the Applicant:
Sri Pramod Kumar Saxena

Counsel for the Opposite Parties:
A.G.A.

Criminal Law-Complainant alleges that
Applicant
owes
some
money-for
repayment Applicant gave a chequeto
Complainant-cheque
was
returned
by
bank for insufficient balance-no evidence
was led by Applicant nor its prima facie
that any fraud exist -bank has also not
made any remarkon the return memo-no
illegality in the orders passed by Court
below-Application dismissed. (E-9)

Cases Cited:

1. Raj Kumar Khurana Vs. State of (NCT of
Delhi) & anr. reported in (2009) 6 SCC 72
(distinguished)

2. S.P. Chengalvaraya Naidu (dead) by L.Rs.
Appellants Vs. Jagannath (dead) by L.Rs. & ors.r
Respondents, reported in AIR 1994 SC 853;

3. Kali Ram Vs. St. of H.P., reported in (1973) 2
SCC 808

4.
Bharat
Barrel
&
Drum
Manufacturing
Company Vs. Amin Chand Pyarelal

5. M.S. Narayana Menon Alias Mani Vs. St. of
Kerala & anr., reported in (2006) 6 SCC 39

6. Krishna Janardhan Bhat Vs. Dattatraya G.
Hegde, reported in (2008) 4 SCC 54

7. Kumar Exports Vs. Sharma Carpets, reported
in (2009) 2 SCC 513

8. Rangappa Vs. Sri Mohan, reported in (2010)
11 SCC 441

9. Basalingappa Vs. Mudibasappa reported in
(2019) 5 SCC 418

(Delivered by Hon'ble Mrs. Manju Rani Chauhan, J.)

1. Heard Sri Pramod Kumar
Saxena,
learned
counsel
for
the
applicant and Mr. Amit Singh Chauhan
and
Mr.
Prashant
Kumar,
learned
A.G.As. for the State.

2.

Learned
counsel
for
the
applicant and the learned A.G.A. agree
that the present application may be
disposed of at this stage without calling
for further affidavits in view of the
order proposed to be passed today.
3-5 All. Ranjit Vs. State of U.P. & Anr.
1753

3. By means of this 482 Cr.P.C.
application, the applicant has questioned
summoning order dated 7th May, 2019
passed by the Chief Judicial Magistrate,
Jalaun in Complaint Case No.1277 of 2019
(Sm. Kamla Devi Vs. Ranjit), under
Section 138 of the Negotiable Instruments
Act, 1881 (hereinafter referred to as the
"N.I. Act"), Police Station-Kotwali Orai,
District-Jalaun, whereby the applicant has
been summoned. The applicant also seeks
for quashing of the order dated 24th
October, 2019 passed by the Sessions
Judge, Jalaun in Criminal Revision No. 66
of 2019, whereby the revision filed by the
applicant against the summoning order
dated 7th May, 2019, has been dismissed.

4. The facts, as borne out from the
records of the present application, are as
follows:

The complainant/opposite party
no.2 and applicant are relatives, as the
applicant is son-in-law of brother of the
complainant/opposite party no.2. In month
of April, 2016, being the relative of the
complainant, the applicant had taken a loan
of Rs. 1,90,000/- from the complainant for
purchasing of tractor and installation of
tube-well on his field, on the assurance that
he would repay the same within a year.
After expiry of the aforesaid period, when
the complainant requested the applicant to
return the aforesaid money, he deferred the
same. When the complainant exerted
pressure upon the applicant to repay the
same, he had given a cheque no. 806369 of
Vijaya Bank for a sum of Rs. 1,90,000/- to
the complainant on 15th January, 2019. On
the same day, the complainant has
presented the same before the Central Bank
of India, where her saving bank account is
maintained, for encashment, but the same
has been returned to the complainant on
19th January, along with return memo that
there was no sufficient balance in the
account of the applicant. Thereafter since
the applicant was the relative, opposite
party no.2/complainant did not want to take
any legal action against him, hence she
made all efforts to reconcile the matter but
all
went
in
vain.
Thereafter
the
complainant/opposite party no.2 sent a
legal notice to the applicant through her
advocate on 6th February, 2019 within 15
days of the receipt of return memo, which
has been served upon him on 9th February,
2019. The applicant instead of repaying the
loan amount of complainant, has sent a
reply to the legal notice sent by opposite
party no.2 on 5th March, 2019. Hence, the
present complaint has been filed by the
complainant/opposite party no.2. After
registration of the said complaint case,
impugned summoning order has been
passed against the applicant.

5. Learned counsel for the applicant
submits that the applicant is self-employed
and driving E-Rikshaw for his livelihood in
New Delhi and its surrounding area for the
last
five
years.
Opposite
party
no.2/complainant is sister of father-in-law
of the brother of the applicant, namely,
Dharmendra. The allegations made in the
complaint case that the applicant has taken
loan of Rs. 1,90,000/- from the complainant
for purchasing tractor and installation of
tube-well on his field, is absolutely false
and fictitious as in the year 2016, the
applicant was living in New Delhi, where
he was driving E-Rickshaw for his
livelihood. It is further submitted that the
applicant had never given any cheque of
Rs. 1,90,000/- to the complainant/opposite
party no.2 for repayment of loan taken by
him. He was unaware of any conspiracy
which was being hatched by opposite party
1754 INDIAN LAW REPORTS ALLAHABAD SERIES
no.2 or her sons. After receiving legal
notice dated 6th February, 2019 sent by the
Advocate of complainant about the loan
taken, dishonour of cheque and demand of
payment, he came to know that some
conspiracy is going on against him and he
tried to search his cheque book and found
that the same was missing. On 28th
February, 2019, the applicant informed the
concerned Branch of the Bank about his
missing cheques and stopping of payment
from the said account. It is further
submitted that being close relatives, sons of
the complainant, namely, Sandeep, Jitendra
and Kuldeep, came to Delhi and resided in
the room of the applicant in November,
2018 and they stole the cheque book of the
applicant and by making his forged
signatures, they cooked up a false and
frivolous story. It is further submitted that
the
applicant
was
not
engaged
in
agriculture for which he had to take any
loan. His father and two elder brothers are
engaged in agriculture. When he came to
know that Sandeep son of opposite party
no.2 had stolen his cheque book and forged
his signatures on one leaf and deposited in
the account of opposite party no.2 at Orai
as conspired, the applicant gave reply to the
legal notice sent by opposite party no.2
through her Advocate on 5th March, 2019.
It is further submitted that after getting
reply of notice, opposite party no.2 instead
of contacting the applicant and clarifying
the matter, straightway filed the present
complaint case against him on 19th March,
2019 without enclosing copy of the reply of
applicant.
The
concerned
Magistrate,
without application of judicial mind, took
congizance and summoned the applicant on
7th May, 2019. Since the applicant was
residing in Delhi, he had no knowledge
about the summoning order issued against
him and could not appear before the court
below, the bailable warrant has been issued
against him. It is against the summoning
order dated 7th May, 2019, applicant has
preferred Criminal Revision No. 66 of
2019, which has also been dismissed by the
District and Sessions Judge, Jalaun at Orai
vide order dated 24th October, 2019. The
revisional court has also committed error in
confirming the summoning order. It is
further submitted that on 20th September,
2019 the applicant has also tried to lodge a
first
information
report
against
the
complainant and her sons for theft, forgery
and cheating and when the same has not
been lodged, he moved a complaint before
the Chief Judicial Magistrate, Jalaun which
was registered as Complaint Case No. 5549
of 2019. It is further submitted that the
complaint/opposite party no.2 concealed
the facts mentioned in the reply given by
the applicant to the legal notice dated 6th
February, 2019, in which he had taken a
plea that the cheque has been stolen and the
signature appended on he said cheque was
forged. Complainant has also not attached
copy of the said reply along with the
complaint. It is also submitted that in the
complaint, the complainant/opposite party
no.2 did not disclose that by what mode,
before whom and at which place, the loan
was given, as it is not given in the normal
course of business. Such amount is legally
not recoverable debt/loan as per Section
138 N.I. Act, hence no offence will be
constituted if the cheque is dishonored on
the ground of stolen and forged cheque. It
is further submitted that the concerned
Magistrate has acted in mechanical manner
while passing the summoning order dated
7th May, 2019 and did not apply his
judicial mind, as it was not a case of
business transaction but it is case of
hatched conspiracy between near relations.
No details of loan, witnesses and cheque
have been disclosed in the complaint which
makes the whole case very flimsy and
3-5 All. Ranjit Vs. State of U.P. & Anr.
1755
doubtful. In support of his plea, the learned
counsel for the applicant has commended
this Court to the following decisions of the
Apex Court:

1.Raj Kumar Khurana Vs.
State of (NCT of Delhi) & Another
reported in (2009) 6 SCC 72;

2. S.P. Chengalvaraya Naidu
(dead)
by
L.Rs.
Appellants
Vs.
Jagannath (dead) by L.Rs. & other
Respondents, reported in AIR 1994 SC
853; and

6. Learned counsel for the applicants,
therefore,
submitted
that
the
present
criminal proceedings initiated against the
applicants are not only malicious but also
amount to an abuse of the process of the
Court. On the cumulative strength of the
aforesaid submissions, it is submitted by
learned counsel for the applicants that the
proceedings of the above mentioned
complaint case are liable to be quashed by
this Court.

7. Per contra, Mr. Chauhan learned
counsel for the State has opposed the
submissions made by the learned counsel
for the applicant by contending that there is
no illegality or infirmity in the order of
summoning of the applicant passed by the
concerned Magistrate, as also in the order
affirming the same passed by the revisional
court. It is further submitted that the
submissions made by the learned counsel
for the applicant that stolen cheques cannot
be a basis of constituting an offence of
Section 138 of N.I. Act is liable to be
rejected on the ground that it is not a case
of fraud, conspiracy or stealing of cheques.
As per the own case of the applicant, It is
only after receiving legal notice sent by
opposite party no.2 through her Advocate,
he made an application before the Bank
about missing of cheques and stopping of
his account only on 28th February, 2019
and thereafter he went to concerned Police
Station for lodging of the first information
report, but the same has not been lodged
and ultimately he filed a complaint
thereafter. The said step has only been
taken to build up his case of fraud,
conspiracy and stealing of cheque. It is also
submitted that the plea taken on behalf of
the applicant that the signature appended
on the cheque is not of the applicant, the
same is forged and fabricated, which have
been committed by opposite party no.2 and
her sons, is also liable to be rejected on the
ground that after presentation of the cheque
in question before the Bank for encashment
by opposite party no.2, the same has been
dishonoured and returned on 19th January,
2019 with a endorsement that there is no
sufficient balance in the account of the
applicant and not with an endorsement that
the signature is different. The concerned
Magistrate on the basis of materials and
evidence produced before him has rightly
passed the order summoning the applicant.
At the initial stage, the truth, veracity and
effect of the evidence which the prosecutor
adduced cannot be meticulously judged,
nor is any weight to be attached to the
probable defence of the accused. It is not
obligatory for the concerned Magistrate at
that stage to consider in any detail and
weigh in a sensitive balance whether the
facts, if proved, would be incompatible
with the innocence of the accused or not. At
that stage, the concerned Magistrate is not
to see whether there is sufficient ground for
conviction of the accused or whether the
trial is sure to end in his conviction. Strong
suspicion against the accused, if the matter
remains in the region of suspicion, cannot
take the place of proof of his guilt at the
conclusion of the trial. But at the initial
1756 INDIAN LAW REPORTS ALLAHABAD SERIES
stage if there is a strong suspicion which
leads the court to think that there is ground
for presuming that the accused has
committed an offence then it is not open to
the concerned Magistrate to say that there
is no sufficient ground for proceeding
against the accused. It is further submitted
that the revisional court has also not
committed any error in affirming the order
of the concerned Magistrate summoning
the applicant. It is further submitted that the
case laws as cited by the learned counsel
for the applicant are not applicable in the
facts of the present case. On the cumulative
strength of the aforesaid, learned A.G.A.
for the State submits that the present
application is liable to be dismissed.

8. I have considered the submissions
made by the learned counsel for the
applicants and have gone through the
records of the present application.

9. Before expressing any opinion on
the merits of the case set up by both the
parties,
it
would
be
worthwhile
to
reproduce Sections 118, 138 and 139 of the
Negotiable Instrument Act, which are
quoted herein-below:

"118. Presumptions 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;

(b) as to date --that every negotiable
instrument bearing a date was made or drawn
on such date;

(c) as to time of acceptance --that
every accepted bill of exchange was accepted
within a reasonable time after its date and
before its maturity;

(d) as to time of transfer --that every
transfer of a negotiable instrument was made
before its maturity;

(e) as to order of indorsements --that
the indorsements appearing upon a negotiable
instrument were made in the order in which
they appear thereon;

(f) as to stamps --that a lost
promissory note, bill of exchange or cheque
was duly stamped;

(g) that holder is a holder in due
course --that the holder of a negotiable
instrument is a holder in due course:

Provided that, where the instrument
has been obtained from its lawful owner, or
from any person in lawful custody thereof, by
means of an offence or fraud, or has been
obtained from the maker or acceptor thereof by
means of an offence or fraud, or for unlawful
consideration, the burden of proving that the
holder is a holder in due course lies upon him.

138. Dishonour of cheque for
insufficiency, etc., of funds in the account. --
Where any cheque drawn by a person on an
account maintained by him with a banker for
payment of any amount of money to another
person from out of that account for the
discharge, in whole or in part, of any debt
or other liability, is returned by the bank
unpaid, either because of the amount of
money standing to the credit of that account
is insufficient to honour the cheque or that
it exceeds the amount arranged to be paid
from that account by an agreement made
3-5 All. Ranjit Vs. State of U.P. & Anr.
1757
with that bank, such person shall be
deemed to have committed an offence and
shall, without prejudice to any other
provisions of this Act, be punished with
imprisonment for 19 [a term which may be
extended to two years], or with fine which
may extend to twice the amount of the
cheque, or with both: Provided that nothing
contained in this section shall apply unless-
-

(a)
the
cheque
has
been
presented to the bank within a period of
six months from the date on which it is
drawn or within the period of its
validity, whichever is earlier;

(b) the payee or the holder in
due course of the cheque, as the case
may be, makes a demand for the
payment of the said amount of money by
giving a notice in writing, to the drawer
of the cheque, 20 [within thirty days] of
the receipt of information by him from
the bank regarding the return of the
cheque as unpaid; and

(c) the drawer of such cheque
fails to make the payment of the said
amount of money to the payee or, as the
case may be, to the holder in due course
of the cheque, within fifteen days of the
receipt of the said notice.

Explanation.--
For
the
purposes of this section, "debt or other
liability" means a legally enforceable
debt or other liability.]

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 the nature
referred to in section 138 for the discharge,
in whole or in part, of any debt or other
liability."

10. From the above, it is manifestly
clear that a dishonour would constitute an
offence only if the cheque is returned by
the bank ''unpaid' either because the amount
of money standing to the credit of the
drawer's account is insufficient to honour
the cheque or that the amount exceeds the
amount arranged to be paid from that
account by an agreement with that bank.
Now, for an offence under Section 138 NI
Act, it is essential that the cheque must
have been issued in discharge of legal debt
or liability by accused on an account
maintained by him with a bank and on
presentation of such cheque for encashment
within its period of validity, the cheque
must have been returned unpaid. The payee
of the cheque must have issued legal notice
of demand within 30 days from the receipt
of the information by him from the bank
regarding such dishonor and where the
drawer of the cheque fails to make the
payment within 15 days of the receipt of
the aforesaid legal demand notice, cause of
action under Section 138 NI Act arises.

11.

From
the
Chapter
XVII
comprising Sections 138 to 142 of the
Negotiable Instruments Act, which was
introduced in statute by Act 66 of 1988, it
is also apparently clear that the object
underlying the provision contained in the
said Chapter was aimed at inculcating faith
in the efficacy of banking operations and
giving credibility to negotiable instruments
in business and day to day transactions by
making dishonour of such instruments an
offence. A negotiable instrument whether
the same is in the form of a promissory
note or a cheque is by its very nature a
solemn document that carries with it not
only a representation to the holder in due
1758 INDIAN LAW REPORTS ALLAHABAD SERIES
course of any such instrument but also a
promise that the same shall be honoured for
payment. To that end Section 139 of the
Act raises a statutory presumption that the
cheque is issued in discharge of a lawfully
recoverable debt or other liability. This
presumption is no doubt rebuttable at trial
but there is no gain saying that the same
favours the complainant and shifts the
burden to the drawer of the instrument (in
case the same is dishonoured) to prove that
the instrument was without any lawful
consideration. It is also noteworthy that
Section 138 while making dishonour of a
cheque
an
offence
punishable
with
imprisonment and fine also provides for
safeguards to protect drawers of such
instruments where dishonour may take
place for reasons other than those arising
out of dishonest intentions. It envisages
service of a notice upon the drawer of the
instrument calling upon him to make the
payment covered by the cheque and
permits prosecution only after the expiry of
the statutory period and upon failure of the
drawer to make the payment within the said
period.

12. This Court having noticed the
facts of the case and the evidence on the
record needs to note the legal principles
regarding nature of presumptions to be
drawn under Section 139 of the Act and the
manner in which it can be rebutted by an
accused.
Section
118
provides
for
presumptions as to negotiable instruments.
The complainant being holder of cheque
and the signature appended on the cheque
having not been denied by the Bank,
presumption shall be drawn that cheque
was issued for the discharge of any debt or
other liability. The presumption under
Section 139 is a rebuttable presumption.
Before this Court refers to various
judgments of the Apex Court considering
Sections 118 and 139, it is relevant to
notice the general principles pertaining to
burden of proof on an accused especially in
a case where some statutory presumption
regarding guilt of the accused has to be
drawn.

13. A Three-Judge Bench of the Apex
Court in the case of Kali Ram Vs. State of
Himachal Pradesh, reported in (1973) 2
SCC 808 has laid down following:-

"23. ........................One of the
cardinal principles which has always to be
kept
in
view
in
our
system
of
administration of justice for criminal cases
is that a person arraigned as an accused is
presumed to be innocent unless that
presumption is rebutted by the prosecution
by production of evidence as may show
him to be guilty of the offence with which
he is charged. The burden of proving the
guilt of the accused is upon the prosecution
and unless it relieves itself of that burden,
the courts cannot record a finding of the
guilt of the accused. There are certain cases
in which statutory presumptions arise
regarding the guilt of the accused, but the
burden even in those cases is upon the
prosecution to prove the existence of facts
which have to be present before the
presumption can be drawn. Once those
facts are shown by the prosecution to exist,
the
Court
can
raise
the
statutory
presumption and it would, in such an event,
be for the accused to rebut the presumption.
The onus even in such cases upon the
accused is not as heavy as is normally upon
the prosecution to prove the guilt of the
accused. If some material is brought on the
record consistent with the innocence of the
accused which may reasonably be true,
even though it is not positively proved to
be true, the accused would be entitled to
acquittal."
3-5 All. Ranjit Vs. State of U.P. & Anr.
1759

14. Further the Apex Court in Bharat
Barrel
&
Drum
Manufacturing
Company Vs. Amin Chand Pyarelal,
reported in (1999) 3 SCC 35 had
considered Section 118(a) of the Act and
held that once execution of the promissory
note is admitted, the presumption under
Section 118(a) would arise that it is
supported by a consideration. Such a
presumption is rebuttable and defendant
can
prove
the
non-existence
of
a
consideration
by
raising
a
probable
defence. In paragraph No.12 following has
been laid down:-

"12.
Upon
consideration
of
various judgments as noted hereinabove,
the position of law which emerges is that
once execution of the promissory note is
admitted, the presumption under Section
118(a) would arise that it is supported by a
consideration. Such a presumption is
rebuttable. The defendant can prove the
non-existence of a consideration by raising
a probable defence. If the defendant is
proved to have discharged the initial onus
of proof showing that the existence of
consideration was improbable or doubtful
or the same was illegal, the onus would
shift to the plaintiff who will be obliged to
prove it as a matter of fact and upon its
failure to prove would disentitle him to the
grant of relief on the basis of the negotiable
instrument. The burden upon the defendant
of proving the non-existence of the
consideration can be either direct or by
bringing on record the preponderance of
probabilities
by
reference
to
the
circumstances upon which he relies. In
such an event, the plaintiff is entitled under
law to rely upon all the evidence led in the
case including that of the plaintiff as well.
In case, where the defendant fails to
discharge the initial onus of proof by
showing
the
non-existence
of
the
consideration,
the
plaintiff
would
invariably be held entitled to the benefit of
presumption arising under Section 118(a)
in his favour. The court may not insist upon
the defendant to disprove the existence of
consideration by leading direct evidence as
the existence of negative evidence is neither
possible nor contemplated and even if led,
is to be seen with a doubt. The bare denial
of the passing of the consideration
apparently does not appear to be any
defence. Something which is probable has
to be brought on record for getting the
benefit of shifting the onus of proving to the
plaintiff. To disprove the presumption, the
defendant has to bring on record such facts
and circumstances upon consideration of
which the court may either believe that the
consideration did not exist or its non-
existence was so probable that a prudent
man would, under the circumstances of the
case, shall act upon the plea that it did not
exist......"

15. In M.S. Narayana Menon Alias
Mani Vs. State of Kerala and Another,
reported in (2006) 6 SCC 39, the Apex
Court had considered Sections 118(a), 138
and 139 of the Act, 1881 and held that that
presumptions both under Sections 118(a)
and 139 are rebuttable in nature. Explaining
the expressions "may presume" and "shall
presume" referring to an earlier judgment,
following was held in paragraph No.28:-

"28. What would be the effect of
the expressions "may presume", ''shall
presume" and "conclusive proof" has been
considered by this Court in Union of India
v. Pramod Gupta, (2005) 12 SCC 1, in the
following terms: (SCC pp. 30-31, para 52)
"It is true that the legislature used two
different phraseologies ''shall be presumed'
and ''may be presumed' in Section 42 of the
Punjab Land Revenue Act and furthermore
1760 INDIAN LAW REPORTS ALLAHABAD SERIES
although provided for the mode and
manner of rebuttal of such presumption as
regards the right to mines and minerals
said to be vested in the Government vis-àvis the absence thereof in relation to the
lands presumed to be retained by the
landowners but the same would not mean
that the words ''shall presume' would be
conclusive. The meaning of the expressions
''may presume' and ''shall presume' have
been explained in Section 4 of the Evidence
Act, 1872, from a perusal whereof it would
be evident that whenever it is directed that
the court shall presume a fact it shall
regard
such
fact
as
proved
unless
disproved. In terms of the said provision,
thus, the expression ''shall presume' cannot
be held to be synonymous with ''conclusive
proof'."

16. In view of the above, it is clear
that the expression "shall presume"
cannot be held to be synonymous with
conclusive
proof.
Referring
to
definition
of
words
"proved"
and
"disproved" under Section 3 of the
Evidence Act, following was laid down
by the Apex Court in paragraph No.30
of the aforesaid judgment:

"30.
Applying
the
said
definitions of "proved" or "disproved"
to the principle behind Section 118(a)
of the Act, the court shall presume a
negotiable
instrument
to
be
for
consideration unless and until after
considering the matter before it, it
either believes that the consideration
does not exist or considers the nonexistence
of
the
consideration
so
probable that a prudent man ought,
under
the
circumstances
of
the
particular
case,
to
act
upon
the
supposition that the consideration does
not
exist.
For
rebutting
such
presumption, what is needed is to raise
a probable defence. Even for the said
purpose, the evidence adduced on
behalf of the complainant could be
relied upon."

17. The Apex Court has already held
that what is needed is to raise a probable
defence, for which it is not necessary for
the accused to disprove the existence of
consideration by way of direct evidence
and even the evidence adduced on behalf of
the complainant can be relied upon.
Dealing with standard of proof, following
was observed in paragraph No.32:-

"32. The standard of proof
evidently is preponderance of probabilities.
Inference of preponderance of probabilities
can be drawn not only from the materials
on record but also by reference to the
circumstances upon which he relies."

18. In Krishna Janardhan Bhat Vs.
Dattatraya G. Hegde, reported in (2008) 4
SCC 54, the Apex Court has held that an
accused for discharging the burden of proof
placed upon him under a statute need not
examine himself. He may discharge his
burden on the basis of the materials already
brought on record. Following was laid
down in Paragraph No.32:-

"32. An accused for discharging
the burden of proof placed upon him under
a statute need not examine himself. He may
discharge his burden on the basis of the
materials already brought on record. An
accused has a constitutional right to
maintain silence. Standard of proof on the
part of an accused and that of the
prosecution in a criminal case is different."

19. The Apex Court again reiterated
that whereas prosecution must prove the
3-5 All. Ranjit Vs. State of U.P. & Anr.
1761
guilt of an accused beyond all reasonable
doubt, the standard of proof so as to prove
a defence on the part of an accused is
"preponderance
of
probabilities".
In
paragraph No.34, following was laid
down:-

"34.
Furthermore,
whereas
prosecution must prove the guilt of an
accused beyond all reasonable doubt, the
standard of proof so as to prove a defence
on
the
part
of
an
accused
is
"preponderance of probabilities". 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
he relies."

20. In Kumar Exports Vs. Sharma
Carpets, reported in (2009) 2 SCC 513, the
Apex Court again examined as to when
complainant discharges the burden to prove
that instrument was executed and when the
burden shall be shifted. In paragraph Nos.
18 to 20, following has been laid down:-

"18. Applying the definition of the
word "proved" in Section 3 of the Evidence
Act to the provisions of Sections 118 and
139 of the Act, it becomes evident that in a
trial under Section 138 of the Act a
presumption will have to be made that
every negotiable instrument was made or
drawn for consideration and that it was
executed for discharge of debt or liability
once the execution of negotiable instrument
is either proved or admitted. As soon as the
complainant discharges the burden to prove
that the instrument, say a note, was
executed by the accused, the rules of
presumptions under Sections 118 and 139
of the Act help him shift the burden on the
accused. The presumptions will live, exist
and survive and shall end only when the
contrary is proved by the accused, that is,
the cheque was not issued for consideration
and in discharge of any debt or liability. A
presumption is not in itself evidence, but
only makes a prima facie case for a party
for whose benefit it exists.

19. The use of the phrase "until
the contrary is proved" in Section 118 of
the Act and use of the words "unless the
contrary is proved" in Section 139 of the
Act read with definitions of "may presume"
and "shall presume" as given in Section 4
of the Evidence Act, makes it at once clear
that presumptions to be raised under both
the provisions are rebuttable. When a
presumption is rebuttable, it only points out
that the party on whom lies the duty of
going forward with evidence, on the fact
presumed and when that party has
produced evidence fairly and reasonably
tending to show that the real fact is not as
presumed, the purpose of the presumption
is over.

20. ........................The accused
may adduce direct evidence to prove that
the note in question was not supported by
consideration and that there was no debt or
liability to be discharged by him. However,
the court need not insist in every case that
the accused should disprove the nonexistence of consideration and debt by
leading
direct
evidence
because
the
existence of negative evidence is neither
possible nor contemplated. At the same
time, it is clear that bare denial of the
passing of the consideration and existence
of debt, apparently would not serve the
purpose of the accused. Something which is
probable has to be brought on record for
getting the burden of proof shifted to the
complainant. To disprove the presumptions,
the accused should bring on record such
facts
and
circumstances,
upon
1762 INDIAN LAW REPORTS ALLAHABAD SERIES
consideration of which, the court may
either believe that the consideration and
debt did not exist or their non-existence
was so probable that a prudent man would
under the circumstances of the case, act
upon
the
plea
that
they
did
not
exist..............."

21. A Three-Judge Bench of the Apex
Court in Rangappa Vs. Sri Mohan,
reported in (2010) 11 SCC 441 had
elaborately
considered
provisions
of
Sections 138 and 139. In the above case,
trial court had acquitted the accused in a
case relating to dishonour of cheque under
Section 138. The High Court had reversed
the judgment of the trial court convicting
the accused. In the above case, the accused
had admitted signatures on the cheque. This
Court held that where the fact of signature
on
the
cheque
is
acknowledged,
a
presumption has to be raised that the
cheque pertained to a legally enforceable
debt or liability, however, this presumption
is of a rebuttal nature and the onus is then
on the accused to raise a probable defence.
In Paragraph No.13, following has been
laid down:-

"13. The High Court in its order
noted that in the course of the trial proceedings,
the accused had admitted that the signature on
the impugned cheque (No. 0886322 dated 8-2-
2001) was indeed his own. Once this fact has
been acknowledged, Section 139 of the Act
mandates a presumption that the cheque
pertained to a legally enforceable debt or
liability. This presumption is of a rebuttal nature
and the onus is then on the accused to raise a
probable defence. With regard to the present
facts, the High Court found that the defence
raised by the accused was not probable."

22. After referring to various other
judgments of this Court, the Apex Court in
that case held that the presumption
mandated by Section 139 of the Act does
indeed include the existence of a legally
enforceable debt or liability, which, of
course, is in the nature of a rebuttable
presumption.
In
paragraph
No.26,
following was laid down:-

"26. In light of these extracts, we are
in agreement with the respondent claimant that
the presumption mandated by Section 139 of the
Act does indeed include the existence of a
legally enforceable debt or liability. To that
extent, the impugned observations in Krishna
Janardhan Bhat, (2008) 4 SCC 54 may not be
correct. However, this does not in any way cast
doubt on the correctness of the decision in that
case since it was based on the specific facts and
circumstances therein. As noted in the citations,
this is of course in the nature of a rebuttable
presumption and it is open to the accused to
raise a defence wherein the existence of a
legally enforceable debt or liability can be
contested. However, there can be no doubt that
there is an initial presumption which favours
the complainant."

23. Elaborating further, the Apex
Court has held that Section 139 of the Act
is an example of a reverse onus and the test
of
proportionality
should
guide
the
construction and interpretation of reverse
onus clauses on the defendant-accused and
the defendant- accused cannot be expected
to discharge an unduly high standard of
proof. In paragraph Nos. 27 and 28,
following was laid down:-

"27. Section 139 of the Act is an
example of a reverse onus clause that has
been included in furtherance of the
legislative objective of improving the
credibility of negotiable instruments. While
Section 138 of the Act specifies a strong
criminal
remedy
in
relation
to
the
3-5 All. Ranjit Vs. State of U.P. & Anr.
1763
dishonour of cheques, the rebuttable
presumption under Section 139 is a device
to prevent undue delay in the course of
litigation. However, it must be remembered
that the offence made punishable by
Section 138 can be better described as a
regulatory offence since the bouncing of a
cheque is largely in the nature of a civil
wrong whose impact is usually confined to
the private parties involved in commercial
transactions. In such a scenario, the test of
proportionality
should
guide
the
construction and interpretation of reverse
onus clauses and the defendant-accused
cannot be expected to discharge an unduly
high standard of proof.

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 that when an accused
has to rebut the presumption under Section
139, the standard of proof for doing so is
that of "preponderance of probabilities".
Therefore, if the accused is able to raise a
probable defence which creates doubts
about the existence of a legally enforceable
debt or liability, the prosecution can fail. As
clarified in the citations, the accused can
rely on the materials submitted by the
complainant in order to raise such a
defence and it is conceivable that in some
cases the accused may not need to adduce
evidence of his/her own."

24. In its latest judgment, the Apex
Court in the case of Basalingappa Vs.
Mudibasappa reported in (2019) 5 SCC
418, specifically in paragraph nos. -23 and
24 has noticed as follows:

"23. We may now notice judgment
relied by the learned counsel for the
complainant, i.e., judgment of this Court in
Kishan Rao Vs. Shankargouda, (2018) 8
SCC 165. This Court in the above case has
examined Section 139 of the Act. In the
above case, the only defence which was
taken by the accused was that cheque was
stolen by the appellant. The said defence
was rejected by the trial court. In
paragraph Nos. 21 to 23, following was
laid down:-

"21. In the present case, the trial
court as well as the appellate court having
found that cheque contained the signatures
of the accused and it was given to the
appellant to present in the Bank, the
presumption under Section 139 was rightly
raised which was not rebutted by the
accused. The accused had not led any
evidence
to
rebut
the
aforesaid
presumption. The accused even did not
come in the witness box to support his case.
In the reply to the notice which was given
by the appellant, the accused took the
defence that the cheque was stolen by the
appellant.