Jojo Scaria v. M.V Joseph (Pappachan) and The State of Kerala

## **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ``` THE HONOURABLE MRS. JUSTICE MARY JOSEPH ``` ``` MONDAY, THE 18[TH] DAY OF DECEMBER 2023 / 27TH AGRAHAYANA, ``` ## **`1945`** ## **`CRL.A NO. 1172 OF 2019`** ``` AGAINST THE JUDGMENT DATED 03.09.2019 IN ST NO.774 OF 2016 OF JUDICIAL FIRST CLASS MAGISTRATE COURT, PALA ``` ## **`PETITIONER/ COMPLAINANT:`** ``` JOJO SCARIA, AGED 43 YEARS S/O SCARIA, CHIRAYATHU HOUSE, MOONNANI BHAGAM, PALA, KOTTAYAM DISTRICT. ``` ``` BY ADV. ARUN CHANDRAN(K/000575/2008) ``` ## **`RESPONDENTS / ACCUSED AND STATE:`** ``` 1M.V JOSEPH (PAPPACHAN), AGED 72 YEARS S/O VARKEY, MANIKOMBEL HOUSE, THIDANADU KARA, KALAKETTY P.O. KOTTAYAM DISTRICT-686 508. ``` ``` 2THE STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA-682 031. ``` ``` BY ADV. SRI.P.C.HARIDAS ``` ``` SRI. DENNY DEVASSY (PUBLIC PROSECUTOR) ``` ``` THIS CRIMINAL APPEAL HAVING COME UP FOR HEARING ON 22.11.2022, THE COURT ON 18.12.2023 DELIVERED THE FOLLOWING: ``` Crl.A. No. 1172 of 2019 -:2:- ## **MARY JOSEPH, J.** - - - - - - - - - - - - - - - - - - - - - - - Crl.A. No. 1172 of 2019 - - - - - - - - - - - - - - - - - - - - - - - Dated this the 18[th] day of December, 2023 ## **JUDGMENT** The appeal on hand is originated from a judgment passed by Judicial First Class Magistrate Court, Pala (for short ‘the trial court’) in S.T.No.774/2016, which is a prosecution launched by the appellant under Section 138 of the Negotiable Instruments Act, 1881 (for short ‘the NI Act’). By the judgment referred to, the trial court found the accused not guilty of the offence punishable under Section 138 NI Act and acquitted him under Section 255(1) of the Code of Criminal Procedure, 1973 (for short ‘Cr.P.C’). He was set at liberty after cancelling the bail bond executed by him. 2. The facts of the case in brief are narrated hereunder: The complainant is the son-in-law of the accused. The accused borrowed a sum of `30,00,000/- from the complainant for meeting the travelling expenses of his son. Crl.A. No. 1172 of 2019 -:3:- Towards the discharge of the said liability, the accused had drawn a cheque on Federal Bank Ltd., Aruvithura Branch for that amount and issued to the complainant on 07.08.2011. The borrowal of the amount as well as the issuance of the cheque were taken place at the residence of the complainant. The cheque was presented by the complainant for collection through State Bank of India, Pala Branch, but it was bounced for the reason insufficiency of funds in the account of the accused. The complainant caused a registered legal notice to be issued to the accused. The notice was received by the accused but neither a reply was sent nor the money covered by the cheque was paid. Alleging that the accused has committed an offence under Section 138 NI Act, a private complaint was filed under Section 142 NI Act and thus the prosecution against him was launched. 3. Cognizance was taken by the court after recording the sworn statement of the complainant. Process was served on the accused from the court and on appearance, he was released on bail after furnishing the copies of all relevant Crl.A. No. 1172 of 2019 -:4:- records on him. Particulars of the offence were read over and explained to him for which, he pleaded not guilty, and faced trial. 4. PWs 1 to 7 were examined and Exts.P1 to P49 were marked on the side of the complainant. On closure of the evidence of the complainant, the accused was questioned under Section 313 (1)(b) Cr.P.C. He denied all the incriminating circumstances levelled against him. Dws 1 to 3 and Exts. P1 to 11 were marked from the side of the accused. 5. The complainant filed proof affidavit in lieu of examination in chief and was cross examined as PW1. According to him the accused has promised to repay the borrowed amount as and when his son obtains a job at Australia. According to him the accused had brought the cheque marked as Ext. P1 in evidence, from his side after filling up all entries and signing it, in his presence. 6. The complainant examined the Manager of Aruvithura branch of Federal Bank Ltd. as PW2 and through him the account opening form of the accused with the bank was ## Crl.A. No. 1172 of 2019 -:5:- marked as Ext.P8. The Manager of Kizhathadiyoor Service Co-operative Bank was examined as PW3. He deposed that the accused had availed a loan of `10,00,000/- from the bank, on 01.08.2011. He produced documents showing various proceedings relating to that loan and marked in evidence as Exts. P36 to P42. 7. The Branch Manager of State Bank of India, Erattupetta was examined as PW4. He produced the housing loan account closure statement of the complainant and marked it in evidence as Ext. P43. The Manager of Meenachil East Urban Co-operative Bank was examined as PW5. The documents pertaining to the loan account were produced by him and marked in evidence as Ext. P45 series. 8. The wife of the complainant who was also the daughter of the accused was examined as PW7. She tendered oral evidence to the effect that Ext.P1 was signed by the accused in her presence. According to her, the entries in Ext.P1 cheque were filled up in blue ink. The signature was also authored in blue ink. But when Ext.P1 was shown to her, Crl.A. No. 1172 of 2019 -:6:- she deviated from her earlier statement and deposed that the entries and signature in Ext.P1 were put in black ink. 9. The accused relied on the depositions of the witnesses examined by him as DWs 1 to 3. An Assistant of Armed Forces, Fort Kochi was examined as DW1. He was also working as Sunday School teacher at Chemmanimattom Church. The attendance register of the Sunday School was produced by him and marked in evidence as Ext.D4 to establish that on 07.08.2011, the accused was present at Sunday School, the working time of which was from 9.30 a.m till 12.45 p.m. 10. The Manager of Meenachil East Urban Co-operative Bank was examined as DW2. Valuation certificates of the property belongs to the accused was produced and marked in evidence as Ext.D5. The son of the accused who was the brother-in-law of the complainant, was examined as DW3. According to him, he was working in Australia since July, 2012. Prior to that he was working as a nurse at New Zealand. Documents pertaining to the financial transaction he Crl.A. No. 1172 of 2019 -:7:- had at New Zealand as well as Australia were produced by him and marked in evidence as Exts.D6 to D11. According to him he had paid money to the complainant on various occasions. Admittedly 47 cents of property was also purchased by him at Cherpunkal in the year 2011. He had also purchased 1½ acres of property at Ezhamchery in the year 2013. His wife was also working as a nurse in New Zealand since 2006 and she has also shifted her work to Australia. According to him, money was never demanded by him from the complainant for the purpose of migration as pleaded by the latter. According to him he had no occasion for the same. 11. The argument of the learned counsel for the appellant was that the trial court went wrong in acquitting the accused. The learned counsel had relied on various decisions of the Apex Court and those of the High Courts to rest the various contentions taken. ## In _**Sanil James v. State of Kerala and Another**_ _**2022 (6) KHC 278**_ relied on, it has been held, Crl.A. No. 1172 of 2019 -:8:- “15. Thus the law is clear on the point that when the complainant discharged the initial burden to prove the transaction led to execution of the cheque, the presumption under S.118 and S.139 of the N.I. Act would come into play. No doubt, these presumptions are rebuttable and it is the duty of the accused to rebut the presumptions and the standard of proof of rebuttal is nothing but preponderance of probabilities.” ## In **P.Rasiya v. Abdul Nazer and Another [2022 SAR** ## ( **Crl** ) **970** ], it has been held by the Apex Court. “As per Section 139 of the N.I. Act, 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 discharge, in whole or in part, of any debt or other liability. Therefore, once the initial burden is discharged by the Complainant that the cheque was issued by the accused and the signature and the issuance of the cheque is not disputed by the accused, in that case, the onus will shift upon the accused to prove the contrary that the cheque was not for any debt or other liability. The presumption under Section 139 of the N.I. Act is a statutory presumption and thereafter, once it is presumed that the cheque is issued in whole or in part of any debt or other liability which is in favour of the Complainant/holder of the Crl.A. No. 1172 of 2019 -:9:- cheque, in that case, it is for the accused to prove the contrary.” ## In **Triyambak S. Hegde v. Sripad [2021 (5) KHC 563 SC]** , it was held by the Apex Court : “From the facts arising in this case and the nature of the rival contentions, the record would disclose that the signature on the documents at Exhibits P6 and P2 is not disputed. Exhibit P2 is dishonoured cheque based on which the complaint was filed. From the evidence tendered before the JMFC, it is clear that the respondent has not disputed the signature on the cheque. If that be the position, as noted by the Courts below a presumption would arise under S.139 in favour of the appellant who was the holder of the cheque. Since the signature on the agreement (Exhibit P6) and more particularly the dishonoured cheque (Exhibit P2) was not disputed, the presumption as provided in law had arisen. Such presumption would remain till it is rebutted.” ## It has been held further : “Insofar as the payment of the amount by the appellant in the context of the cheque having been signed by the respondent, the presumption for passing of the consideration would arise as provided under S.118(a) of N.I Act. The above noted provisions are explicit to the effect that such presumption would remain, until the contrary is proved.” Crl.A. No. 1172 of 2019 -:10:- ## The Apex Court in the case also distinguished its view in _**Basalingappa v. Mudibasappa**_ [2019 (2) KHC 451] and ## held : “In _**Basalingappa v. Mudibasappa**_ (supra) relied on by the learned counsel for the respondent, though on facts the ultimate conclusion therein was against raising presumption, the facts and circumstances are entirely different as the transaction between the parties as claimed in the said case is peculiar to the facts of that case where the consideration claimed to have been paid did not find favour with the Court keeping in view the various transactions and extent of amount involved. However, the legal position relating to presumption arising under S.118 and S.139 of N.I. Act on signature being admitted has been reiterated. Hence, whether there is rebuttal or not would depend on the facts and circumstances of each case. ” ## In **Bhupesh Rathod v. Dayashankar Prasad Chaurasia and Another [2021 (6) KHC 368]** , the Apex ## Court held : “We must say at the inception that the respondent not having disputed his signatures on the cheques, it was for the respondent to show in what circumstances the cheques had been issued, i.e, why was it not a cheque issued in due course. The words of S.139 of the NI Act are quite clear that unless the contrary is proved, it shall be presumed that the holder of the cheque received the Crl.A. No. 1172 of 2019 ## -:11:- cheque of the nature referred to in S.138 for the discharge, in whole or in part, of any debt or other liability. The respondent has not set up a case that the nature of transaction was of the nature which fell beyond the scope of S.138. Other than taking a technical objection, really nothing has been said on the substantive aspect”. ## In **Sameti Vij v. M/s. Paramount Tech Fab** ## **Industries [2021 (2) KHC 658]** the Apex Court held: “16. It is well settled that the proceedings under S.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. 17. Likewise, under S.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.” ## In **Mathew K.John v. State of Kerala and Another** ## **2021 (1) KHC 232** , it was held by this court : “During examination under S.313(1)(b) Cr.P.C the plea specifically taken by the 2[nd] respondent was that a chitty subscribed with the complainant was bid by him and a cheque was given as security for the prize money. According to him though the chitty was bid and a cheque Crl.A. No. 1172 of 2019 ## -:12:- was given as security, the prize money was not disbursed to him. PW1 was not questioned by the accused with reference to the subscription of chitty with his father and the bid of it by him. The accused did not enter into the box also to depose about the version. Therefore, accused failed to establish the transaction as pleaded by him or in other words, he has thoroughly failed to rebut the presumption either by bringing forth preponderance of probabilities in the evidence of PW1 or by adducing affirmative evidence in defence. In the aforesaid circumstances, the complainant can only be taken as successfully established the execution of the cheque.”. ## 12. Citing the above decisions, the learned counsel for the accused canvassed for maintaining the judgment of the trial court acquitting the accused. According to him the trial court is undoubtedly justified in holding so on the basis of the evidence adduced. According to him the trial court on a scrutiny of the entire evidence adduced by the parties to the appeal held that the accused has successfully challenged the source of income for the complainant to advance a huge sum of `30,00,000/- allegedly borrowed by the accused. The trial court arrived at correctly that the case put forth by the Crl.A. No. 1172 of 2019 -:13:- accused by examining his witnesses and marking the documents is more probable than that advanced by the complainant. 13. The learned counsel for the accused has relied on **Ghurey Lal V. State of U.P** [(2008 KHC 5109) = 2009 (1) SCC (Cri) 60] to rest his contention that acquittal by the trial Court should not be interfered with unless it is totally perverse or wholly unsustainable. The learned counsel canvassed that the judgment of acquittal of the trial court assailed in the appeal is not liable to be interfered with for the reason that it is totally perverse or wholly unsustainable. According to him, in the case cited the High Court of Uttar Pradesh re appreciated the entire evidence in a case of murder and came to the conclusion that the trial court’s judgment was perverse and untenable and thereby convicted the accused under Section 302 IPC. It was held by the Apex Court that the reasons given by the High Court for reversing the judgment of acquittal is unsustainable and contrary to the settled principles of law. Crl.A. No. 1172 of 2019 -:14:- 14. **Basalingappa Vs. Mudibasappa** (2019 (2) KHC 451 SCC) was relied on by the learned counsel for the accused to contend that when the financial capacity of the complainant was questioned, it is incumbent on him to have it established satisfactorily. 15. In the above case, during cross examination, the financial capacity to pay `6,00,000/- to the accused was questioned but, no satisfactory reply was given by the complainant. The trial court appreciated that evidence in the proper perspective and acquitted the accused. High Court reversed the findings of the trial court and convicted the accused. 16. In the appeal preferred against the finding of guilt and orders of conviction and sentence, the Apex Court held:- “It was brought in the evidence that in the year 2010, the complainant entered into a sale agreement for which he paid an amount of Rs.4,50,000/- to Balana Gouda towards sale consideration. Payment of Rs.4,50,000/- being admitted in the year 2010 and further payment of loan of Rs.50,000/- with regard to which complaint No.119 of 2012 was filed by the Crl.A. No. 1172 of 2019 ## -:15:- complainant, copy of which complaint was also filed as Ex.D2, there was burden on the complainant to prove his financial capacity. In the year 2010-2011, as per own case of the complainant, he made payment of Rs.18 lakhs. During his cross-examination, when financial capacity to pay Rs.6 lakhs to the accused was questioned, there was no satisfactory reply given by the complainant. The evidence on record, thus, is a probable defence on behalf of the accused, which shifted the burden on the complainant to prove his financial capacity and other facts.” 17. During cross examination, when financial capacity of the complainant to pay `6,00,000/- to the accused was questioned, satisfactory reply was not given by him and the court held in that context that the evidence on record is a probable defence on behalf of the accused, which shifted the burden on the complainant to prove his financial capacity and other aspects. 18. The Apex Court has also laid down some general principles pertaining to burden of proof on an accused in a case where statutory presumption regarding guilt of the accused can be drawn, as follows:- Crl.A. No. 1172 of 2019 ## -:16:- “(i) Once the execution of cheque is admitted S.139 of the Act mandates a presumption that the cheque was issued for the discharge of any debt or other liability. (ii) The presumption under S.139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities. (iii) To rebut the presumption, it is open for the accused to rely on evidence led by him or accused can also rely on the materials submitted by the complainant in order to raise a probable defence. 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 they rely. (iv) That it is not necessary for the accused to come in the witness box in support of his defence, S.139 imposed an evidentiary burden and not a persuasive burden. (v) It is not necessary for the accused to come in the witness box to support his defence.” ## 19. The learned counsel has also cited **Tedhi Singh V.** **Narayan Dass Mahant** (2022 (2) KLT 1123 (SC)), wherein it was held by the Apex court:- Crl.A. No. 1172 of 2019 ## -:17:- “ The proceedings under Section 138 of the N. I. Act is not a civil suit. At the time, when the complainant gives his evidence, unless a case is set up in the reply notice to the statutory notice sent, that the complainant did not have the wherewithal, it cannot be expected of the complainant to initially lead evidence to show that he had the financial capacity. To that extent the Courts in our view were right in holding on those lines. However, the accused has the right to demonstrate that the complainant in a particular case did not have the capacity and therefore, the case of the accused is acceptable which he can do by producing independent materials, namely, by examining his witnesses and producing documents. It is also open to him to establish the very same aspect by pointing to the materials produced by the complainant himself. He can further, more importantly, achieve this result through the cross examination of the witnesses of the complainant. Ultimately, it becomes the duty of the Courts to consider carefully and appreciate the totality of the evidence and then come to a conclusion whether in the given case, the accused has shown that the case of the complainant is in peril for the reason that the accused has established a probable defence.” ## The Apex Court held furthermore :- “It is accordingly that the principle has developed that all which the accused needs to establish is a probable defence. As to whether a probable defence has been established is a matter to be decided on the facts Crl.A. No. 1172 of 2019 -:18:- of each case on the conspectus of evidence and circumstances that exist.” In the backdrop of the rival contentions raised by the complainant and the accused, the facts and the evidence adduced are required to be re-appreciated. 20. Prior to that the factual matrix is reproduced in a nutshell hereunder:- The complainant is the son in law of the accused. The accused borrowed a sum of `30,00,000/- from the complainant for meeting the travelling expenses of his son, abroad. It was alleged that the accused issued a cheque drawn on Aruvithura branch of Federal Bank Ltd. and given to the complainant. The entire transactions were pleaded as taken place from the house of the complainant and at the time of issuance of the cheque, the accused made the complainant to believe that the cheque would be honoured on presentation. The cheque was presented by the complainant for collection, but was dishonoured and returned back from State Bank of India, Pala branch for insufficiency of funds in the account maintained by him. A registered legal notice was Crl.A. No. 1172 of 2019 -:19:- caused to be issued by the complainant to the accused, which was received by him, but neither any reply was sent nor the amount was paid. Thus, a complaint was filed to launch the prosecution under Section 138 N.I Act. 21. Complainant was examined as PW1. PWs 2 to 7 were examined as witnesses of the complainant. Complainant filed proof affidavit in lieu of examination in chief. He was cross examined as PW1 by the learned defence counsel elaborately. 22. It was brought out during cross examination of PW1 that the time and place of issuance of Ext.P1 cheque were not mentioned in the notice issued by him to the accused and marked in evidence as Ext.P3. It was clarified from the complainant that at the relevant time when Ext.P3 was issued, there was no legal impediments to state those matters there. He deposed during cross examination that he could not recollect the date on which `30,00,000/- was advanced to the accused. According to him, his wife was also present when the amount was advanced. According to him, Crl.A. No. 1172 of 2019 -:20:- the accused had brought Ext.P1 cheque after filling up all entries and the signature was authored on it, in their presence. 23. The branch manager of Federal Bank, Aruvithura branch was examined by the complainant as PW2. The account opening form of the accused in their branch was produced by him and marked in evidence as Ext.P13. 24. The Manager of Kizhathadiyoor Service Co-operative bank was examined as PW3. According to him, the complainant had availed a loan of `10,00,000/- from the bank on 01.08.2011. He has produced documents relating to the loan transactions and marked in evidence as Exts.P36 to P42. 25. The Branch Manager of State Bank of India, Erattupetta branch was examined as PW4. He produced the statement of housing loan account closure of the complainant and marked in evidence as Ext.P43. 26. The Manager of Meenachil East Urban Co-operative bank was examined as PW5. He produced the loan account Crl.A. No. 1172 of 2019 -:21:- details of the accused with the bank and marked in evidence as Ext.P45 series. 27. A close friend of the complainant was examined as PW6. According to him, a loan of `10,00,000/- was availed for the complainant by him from Kizhathadiyoor Service Co-operative Bank, by mortgaging the properties belonging to the former. 28. The wife of the complainant, who was the daughter of the accused was examined as PW7. According to her the accused had signed Ext.P1 cheque in her presence. According to her the particulars of Ext.P1 were not noticed by her. According to her the entries were filled up and the signature was affixed on it in blue ink. But when Ext.P1 cheque was shown to her during examination, she deposed that the entries as well as the signature were made using black ink. 29. Therefore, the complainant has projected a case from the evidence adduced that `30,00,000/- was borrowed by the accused from him for the purpose of meeting the Crl.A. No. 1172 of 2019 -:22:- expenses in connection with travelling of his son to New Zealand. According to him, the amount was agreed to be returned when a job was obtained by his son and settled. He has stated further that the accused brought the cheque to his house with entries filled up and signature authored on it from his house in front of himself and his wife and given to him. According to him, the cheque so issued is Ext.P1 and it when presented before the bank was returned bounced for insufficiency of funds. 30. The complainant examined his wife as PW7. PW7 deposed that she was available at their house when Ext.P1 was brought by the accused and handed over to the complainant. According to PWs 1 and 7, signature was put by the accused in Ext.P1 in front of them. During cross examination, it was brought out by the accused that in the statutory notice sent by the complainant as Ext.P3, the date and time of issuance of Ext.P1 was not stated. PW1 had also stated that there were no impediments for him to write those things in Ext.P3. Crl.A. No. 1172 of 2019 -:23:- 31. Complainant was examined as PW1 and his wife as PW7. Complainant gave evidence strictly in tune with his averments in the complaint. His wife as PW7 also supported his version that the cheque was brought by the accused at their house and handed over to her husband. According to PWs 1 and 7, the entries of the cheque were filled up at the time when it was brought, but was signed only in their presence. According to PW7, he could not then notice the peculiarities of Ext.P1 cheque but stated precisely that the entries were filled in and the signature was put in blue ink. But, when Ext.P1 was shown to her, she deviated from her version and stated that the ink used was black. Despite the discrepancy crept in the matter of colour of ink during examination of PW7, the versions of PWs 1 and 7 corroborate in aspects of bringing Ext.P1 to the house by the accused with entries filled up, and authoring of signature there in their presence. Admittedly, Ext.P1 cheque was issued from an account opened by the accused with Federal Bank, Aruvithura branch, at the Crl.A. No. 1172 of 2019 -:24:- initiative of the complainant, for his business transaction. The accused has no case that the complainant caused the account to be opened upon practising fraud on him or by compulsion. 32. The trial court is found to have placed reliance in the context on **Divakaran K.K. V. State of Kerala & Anr [2016 (4) KHC 901]** and found that the failure of the complainant to state those aspects in Ext.P3 would amount to suppression of material facts relating to the alleged transaction and thereby, the prosecution is defeated. 33. **Divakaran** supra no longer survives as good law, since it has been declared, per incuriam by a Division Bench of this Court in **Basheer v. Usman Koya** [ 2021 (2) KLT 567]. The Division Bench has settled in the above case that the details of the transactions are immaterial to be narrated in the statutory notice. 34. A perusal of Ext.P3 would reveal that the complainant has specifically stated there that the cheque issued by the accused was bounced by the bank for Crl.A. No. 1172 of 2019 -:25:- insufficiency of funds. A demand was also made for payment of the amount covered by the cheque to avoid the prosecution proposed to be initiated. Therefore, the dual purpose of issuing a statutory notice contemplated under clause (b) of proviso to Section 138 N.I. Act, are served. Therefore, the trial court is erred and unjustified in holding that the prosecution is defeated on account of want of pleadings on all aspects of the monetary transaction involved in the statutory notice issued to the accused. 35. It was canvassed by the learned counsel for the respondent that the version of PW7 cannot be believed at all, since she has spoken inconsistent versions during her examination about the colour of the ink by which the entries in Ext.P1 was put. The contentions raised cannot be taken as a material one seriously affecting the prosecution case, since the defence has taken a stand that Ext.P1 was misused by the complainant by filing up its entries on his own. 36. The stand taken by the accused during cross examination of PW1 was that the complainant was engaged in Crl.A. No. 1172 of 2019 -:26:- rubber business at Erattupetta during 2007 and for doing the financial transactions relating to the said business, he made a request to him to open an account with Aruvithura Branch of Federal Bank. The accused approached the bank officials and at the instance of the complainant, he opened a savings bank account there. The complainant kept the passbook, the cheque book having ten cheque leaves and the ATM card obtained from the bank in his favour for the purpose of the business. He manipulated the cheque leaves without his knowledge and consent, while himself and his wife were residing in Australia with their son. When he returned from Australia, the complainant demanded him to clear off the arrears of the loan pending in Kizhathadiyoor Service Co-operative Bank. The accused was not amenable for that and out of vengeance, a cheque leaf was fabricated by the complainant and the prosecution in question was launched. 37. During cross examination, the accused has also brought out from the complianant that he was doing a partnership business consisting of 9 partners, one among ## Crl.A. No. 1172 of 2019 -:27:- whom was one Mr.N.U.Joseph who is the brother of Mr.M.U.John, an employee of Aruvithura branch of Federal Bank Ltd. It was brought out further that Sri.M.U.John introduced the accused to the bank to open a new account at the instance of the complainant. 38. From the stand taken by the accused, this Court has every reason to take a view that the account was opened by him voluntarily and Sri.N.U. Joseph was a friend of the complainant and a partner of him. It was also brought out in evidence that necessary arrangements to open the account were made at Federal Bank Ltd, Aruvithura Branch by Sri.M.U. John who was the brother of Sri.N.U. Joseph, an employee of the bank. The manager of Aruvithura branch of Federal Bank Ltd when examined as PW2 has also brought the account form of the accused to establish the factum that an account was opened by the accused with their bank. 39. Accused has also taken a stand that after opening the account with the bank the passbook and the cheque Crl.A. No. 1172 of 2019 -:28:- book containing ten cheque leaves were kept by the complainant himself. A case of compulsory or fraudulent receipt of those documents having not been projected and established by the accused, it can be presumed that those were kept by the complainant as permitted by the accused, for facilitating his business transactions as and when required. 40. The trial court found on a scrutiny of the oral evidence of PW1 that it is inconsistent in so many material aspects. It also found that in view of the contradictions in the version of PW1, he cannot be relied on. The trial court also raised suspicion on the source of income of PW1 to advance the huge amount. From the version of PW1 itself, it is revealed that he had availed a loan of `10,00,000/- and thus indebted to a bank. According to him, cash worth `10,00,000/- was with him. It is also disclosed by PW1 that he had received money from his father-in-law, the accused. Admittedly the complainant also received money from his brother-in-law for treatment of his child. From the evidence Crl.A. No. 1172 of 2019 -:29:- tendered by PW1, the trial court doubted his source of money to advance `30,00,000/- to the accused. The defence has also brought to light during cross examination of PW1, that the business started by him with his Malaysian connections failed during the first month of 2012. It is surprising to note that even when the business run by the complainant was in failure, he claimed to have advanced money to one Mr. Navas. The trial court disbelieved PW1 for the above inconsistencies brought out by the accused during cross examination. 41. The appeal on hand is filed by the complainant challenging the judgment of the trial court whereby the accused was acquitted for the offence under Section 138 of the NI Act allegedly committed by him. 42. It is pertinent to note that inspite of the specific case projected in evidence by PWs 1 and 7 that Ext.P1 was brought by the accused with all its entries filled up and the signature affixed in their presence, no contra evidence has been adduced. There was no denial from the accused of Crl.A. No. 1172 of 2019 -:30:- those aspects. Accused has not projected a case of forging of his signature in Ext.P1 by the complainant. 43. The learned counsel for the accused has taken a contention during argument that, the complainant is bound to explain the source of his money to advance `30,00,000/- to the accused. Position of law is settled by judicial pronouncements that the complainant need not state those aspects in the complaint. 44. The ingredients attracting an offence under Section 138 N.I. Act and liable to be established for a prosecution to be successful are contained in the provision itself and those are : “i) A person must have drawn a cheque on an account maintained by him in a Bank for payment of certain amount of money to any person out of his account. ii) The cheque should have been drawn for the discharge of any debt or any liability in whole or in part. Iii) The cheque has been presented to the Bank within a period of six months from the date on which it was drawn or within a period of its validity, whichever is earlier. Crl.A. No. 1172 of 2019 -:31:- iv) The cheque 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 with the Bank. v) 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 within thirty days of the receipt of the information by him from the Bank regarding the return of the cheque as unpaid, and vi) The drawer of such cheque fails to make payment of said amount of money to the payee or the holder in due course of the cheque, within 15 days of the receipt of the said notice. ” 45. Therefore, the complainant is not bound to state his financial capacity to advance `30,00,000/- to the accused either in the complaint or during examination in chief before the court. He has only to state in the complaint and to establish by evidence that an amount was advanced to the accused, a cheque was given to discharge the debt due to him, the cheque was bounced on Crl.A. No. 1172 of 2019 -:32:- presentation before a bank for encashment for the reason of insufficiency of funds or the amount exceeds arrangement and that statutory notice was issued to the accused, but the repayment demanded was not made and in such a scenario that the complaint was filed to initiate the prosecution. 46. It has been held by the Apex Court in **Bir Singh v. Mukesh Kumar** [2019 (1) KHC 774 (SC)] as follows : “When a signed blank cheque is admittedly issued voluntarily by the accused to the complainant, it can be presumed that the cheque was issued to discharge a legally enforceable debt.” Therefore, from the evidence adduced by the complainant it can be safely drawn that Ext.P1 cheque was voluntarily issued by the accused to the complainant with signature affixed. Therefore, there is scope for the presumption under Section 138 N.I. Act to be attracted that Ext.P1 was issued by the accused to discharge a debt or liability. As provided under Section 139 N.I. Act, the Crl.A. No. 1172 of 2019 -:33:- presumption attracted would continue to operate until it is rebutted by the accused. 47. It is settled by the Apex Court in **Rajaram s/o Sriramulu Naidu (since deceased) through L.rs. V. Maruthachalam (since deceased) through L.rs.** (2023 (1) KHC 382) that rebuttal of presumption can be in two ways: “The accused has produced income tax returns of the complainant to establish that he did not have financial capacity to lend money as alleged. It has been held that to rebut the presumption, it is open for the accused to rely on evidence led by him or the accused can also rely on the materials submitted by the complainant in order to raise a probable defence. It was held that when the accused had raised a probable defence regarding the financial capacity of the complainant which satisfies the standard of preponderance of probability, trial court rightly acquitted the accused.” 48. Therefore, this Court has to critically analyse the evidence that has been brought on record from PW1 during cross examination by the accused as well as those adduced by the accused independently. The evidence of the accused Crl.A. No. 1172 of 2019 -:34:- in the case on hand consists of the oral evidence tendered by DW1 and Exts.D1 to D3. 49. PW1 was cross examined by the accused with specific reference to the source of his money to advance `30,00,000/- to the accused. The date on which the money was advanced by the complainant to the accused was not stated by him in the complaint. What was stated was that a cheque to discharge the debt was issued by the accused on 07.08.2011. During cross examination when a specific query was put regarding the date on which the amount was advanced by the complainant to the accused, he stated that it was on 07.08.2011. Therefore, complainant himself has projected a case during his examination as PW1 that `30,00,000/- borrowed was agreed by the accused to be repaid as and when his son who migrated to Australia has obtained a job to settle there. He has no case during examination in chief that Ext.P1 was given as security by the accused on the date of borrowal of the money itself. Therefore, the complainant is found to have no definite idea Crl.A. No. 1172 of 2019 -:35:- about the time at which the money was advanced to the accused and Ext.P1 cheque was issued by the latter to him. The inconsistency brought out in evidence by the accused during cross examination of the complainant as PW1, being a material one, as far as the case of the complainant is concerned, benefit of that would only be in favour of the accused and he make use of that to have the presumption under Section 139 N.I Act, rebutted. 50. The complainant as PW1 was also elaborately cross examined on his source of income to advance `30,00,000/- to the accused. Since the complainant has taken a stand that the amount was advanced on 07.08.2011, he must have established his source of money at that point of time. Complainant has stated during examination that a loan of `10,00,000/- was availed by him from the Erattupetta Branch of State Bank of India. According to him, he was also engaged in a partnership business during the year 2007 under the name and style “Star Investments” but it went in loss in 2010. According Crl.A. No. 1172 of 2019 -:36:- to him, his intervention was also there as a broker in a transaction of purchase of 48 cents of property at Cherpunkal town by his brother in law in the month of 2011 and a brokerage was received. He has also stated to have owned 2.5 acres of property in the year 1998. 51. The complainant also examined a close friend of him as PW6. He deposed that a loan of `10,00,000/- was availed by him from Kizhathadiyoor Service Co-operative Bank for the complainant by mortgaging his property. But, he failed to state the exact point of time when the loan was availed by him. The complainant has examined the Manager of Kizhathadiyoor Service Co-operative Bank as PW3 and he deposed that on 01.08.2011 a loan of `10,00,000/- was availed by the complainant from the bank. He has also produced Exts.P36 to 42 with a view to establish the various transactions he had with the Bank. 52. The Manager of State Bank of India, Erattupetta Branch examined by the complainant as PW4 has produced the housing loan account closure statement of the Crl.A. No. 1172 of 2019 -:37:- complainant with the bank, which is marked in evidence as Ext.P43. 53. According to the complainant, a loan of `30,00,000/- was availed by the accused on 07.08.2011 and Ext.P1 was issued on the day itself. When a precise challenge against the source of money of the complainant to advance the amount was raised by the accused, the complainant having been taken a stand that the money was advanced to the accused on 07.08.2011, has to establish the same only with reference to the year 2011. Moreover, it has also come out in evidence during cross examination that the business started by the complainant afresh with some of his friends went in loss and therefore, he closed it. 54. Therefore, a cogent and believable version was spoken by the complainant when a specific challenge was raised by the accused against his source of money to advance `30,00,000/- to him. Admittedly PW1 had availed financial assistance from his brother in law, the son of the accused himself who was abroad then, for meeting the ## Crl.A. No. 1172 of 2019 -:38:- travel expenses of whom, `30,00,000/- was allegedly advanced by him. Admittedly, money was also availed by the complainant from his father in law during hospitalisation of his son. Complainant has also projected a case that he had advanced a huge sum to one Mr.Navas, though admittedly his business then was running in loss. Therefore, the narration given by the complainant about the source of money he had at the relevant time to advance `30,00,000/- is highly inconsistent, unbelievable and is only to be discarded being devoid of any basis. 55. The case of the complainant was that `30,00,000/- was availed by the accused as loan from him for meeting the travelling expenses of his son to go abroad. The son of the accused, who is the brother in law of the complainant was examined as DW3 and he would say that the complainant has availed financial assistance from him. He deposed further that prior to proceeding to Australia, himself and his wife were working as nurses at New Zealand. According to him, at the relevant time when Crl.A. No. 1172 of 2019 -:39:- `30,00,000/- was allegedly availed by him, he had engaged in transactions of purchase of property in his name. According to him, he had the financial resources at the time when he migrated to Australia and there was no occasion for him to borrow funds for the alleged purpose from the complainant. 56. The Manager of Pinnakkanadu branch of Meenachil East Urban Co-opearative bank was examined by the accused as DW2 and through him the valuation certificate of the property belongs to the accused was marked in evidence as Ext.D5. 57. A person working as Assistant at Armed Forces, Fort Kochi was also examined by the accused as DW1. He was working at Sunday School at Chemmanamattom church and the attendance register of the Sunday school was produced by him and marked in evidence as Ext.D4. It is established therefrom that on 07.08.2011, when `30,00,000/- was allegedly advanced to the accused from the house of the complainant, the accused was away at the Crl.A. No. 1172 of 2019 -:40:- Sunday School, the hours of working of which was from 9.30 a.m to 12.45 p.m. 58. From the discussion made hereinabove, this Court is constrained to take a view that the presumption under Section 139 N.I Act was successfully rebutted by the accused. The trial court has taken that view in the matter, and it being highly probable and correct, this Court is inclined to maintain the finding of the trial court that the complainant was not successful in proving the guilt of the accused under Section 138 N.I Act satisfactorily. 59. Therefore, the order of acquittal of the accused is only liable to be maintained. Appeal fails for the reasons and is dismissed. The judgment under challenge is thus maintained. **Sd/MARY JOSEPH JUDGE** ttb