Trial Court was Not Justified in Acquitting Accused u/s 138 of NI Act: High Court

Case Details: Indranil Mondal v. Birla Corporation Ltd. - [2023] 148 taxmann.com 338 (HC-Calcutta)

Judiciary and Counsel Details

• • Tirthankar Ghosh, J.
  • Ranajit Roy for the Appellant.
  • Somopriyo Chowdhury, Kausik De, Ms Kriti Mehrotra, Ms Mohini Majumder & Raghav Munshi for the Respondent.

Facts of the Case

In the instant case, the accused was the proprietor of ‘S’, which carried on business as a dealer and stockist of the complainant company. The complainant company, in due course of business, supplied cement and raised bills. A sum of Rs.1,70,000/- was due and payable by the accused to the complainant, and in the discharge of said liabilities, an account payee cheque was issued by the accused in favour of the complainant company.

Later, the complainant deposited the said cheque with its banker. However, when the said cheque was presented, it was dishonoured with remarks ‘funds insufficient’. As a result, a complaint was filed u/s 138 of the Negotiable Instruments Act, 1881 against the accused.

Consequently, the complainant, in order to prove its case examined a sole witness and relied upon the cheque, the bank returned memo, and the acknowledgement card. The Trial Court opined that the documents so relied upon by the complainant did not reflect or relate to existing liabilities at the time of issuance of the cheque and, therefore, acquitted the accused.

Thereafter, an appeal was made to the Appellate Court against the order passed by the Trial Court. The Appellate Court by the impugned order, set aside the order of acquittal passed by the Trial Court, thereby allowing the criminal appeal and directing the accused to pay a sum of Rs. 3,40,000/- in default of which, to suffer simple imprisonment for 6 months.

Subsequently, an appeal was preferred with the Hon’ble High Court against the order passed by the Appellate Court. The High Court observed that the obligation on the prosecution may be discharged with the help of presumptions of law or fact, unless the accused adduces evidence showing a reasonable possibility of the non-existence of the presumed fact.

High Court Held

The High Court held that no probable defence had been created by the accused nor had the accused been able to dislodge or rebut the prosecution evidence. As such, there was no scope for interference with the order of appeal so passed.

Therefore, the impugned order passed by the Appellate Court was justified in its actions. Accordingly, the appeal was to be dismissed.

List of Cases Reviewed

• • Hiten P Dalal v. Bratindranath Banerjee [2001] 32 SCL 499 (SC) (para 12) followed.

List of Cases Referred to

• • Rohitbhai Jivanlal Patel v. State of Gujarat [2019] 18 SCC 106 (para 10)
  • Sumeti Vij v. Paramount Tech Fab Industries [2021] 128 taxmann.com 169/167 SCL 72 (SC) (para 11)
  • Hiten P. Dalal v. Bartindranath Banerjee [2001] 32 SCL 499 (SC) (para 12).