- 1 - IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY CRIMINAL CRIMINAL CRIMINAL APPELLATE JURISDICTION APPELLATE JURISDICTION APPELLATE JURISDICTION CRIMINAL CRIMINAL CRIMINAL APPLICATION NO.1924 OF 2007 APPLICATION NO.1924 OF 2007 APPLICATION NO.1924 OF 2007 Ramesh Pancham Shah ...Applicant vs. Gajanan Auto Services & Others ...Respondents Mr.Abhay Pande for the applicant Mr.P.A.Pol A.P.P. for State Mr.D.S.Manerkar for the Respondent no.1. CORAM: CORAM: CORAM: A.S.OKA,J. A.S.OKA,J. A.S.OKA,J. DATE DATE DATE : MARCH 23,2009 : MARCH 23,2009 : MARCH 23,2009 P.C.: P.C.: P.C.: 1. Heard Advocate for the applicant in support of this application under sub section 4 of section 378 of the Code of Criminal Procedure,1973. The applicant is the complainant in a complaint under section 138 of the Negotiable Instruments Act,1881 (hereinafter referred to as the said Act). The first and second respondents herein are the accused. The case made out in the complaint is that the second respondent who was the proprietor of the first respondent approached the applicant with a request to advance some money by way of loan for a short period. According to the applicant, the second respondent was known to him and his family members and therefore, on 15th January 2002, he paid a sum of Rs.13,50,000/- to the second respondent by way of loan. According to the applicant, in discharge of the liability of the said loan, the second respondent issued a cheque dated 15th March 2002 in the sum of Rs.13,50,000/-. The said cheque - 2 - was dishonoured. After issuing notice, a complaint was filed which has resulted in acquittal. 2. The learned counsel for the applicant submitted that the cheque was admittedly issued by the second respondent which was dishonoured as the funds were insufficient. He submitted that there is no dispute as regards the said factual aspect. he submitted that there is no dispute regarding service of notice of demand. He submitted that presumption under section 139 of the said Act was available to the applicant and therefore, the applicant was under no obligation to show and establish that he had paid a sum of Rs.13,50,000/- to the second respondent. He placed reliance on the decision of this court in case of Dilip Apte Vs. Nilesh P. Salgaonkar and another [2006 All M.R. (Cri) 292). He submitted that merely because the said amount was not shown in the income tax return, it is no ground to hold that the applicant was not having a capacity to advance the amount. He submitted that failure to show the amount in income tax return will not have a result of rebutting the presumption under section 139 of the said Act. He submitted that the Trial court has committed an error by passing the order of acquittal. 3. I have carefully considered the submissions. The learned Magistrate has pointed out that the defence of the first and second respondent was that the applicant never had any - 3 - capacity to pay an amount of Rs.13,50,000/-. The defence was that there was no transaction of loan and the signatures of the second respondent were obtained by the applicant on the blank promissory note and cheque with a view to submit the said documents to M/s.Kotak Mahindra for obtaining finance for vehicles of the applicant. 4. The learned Judge has referred to the statement in cross examination of the applicant that on the day on which the loan was allegedly advanced his bank balance was to the extent of Rs.40,000/-. He admitted that he had shown the amounts of Rs.1,00,000/- and Rs.1,50,000/- as profits in the year 2002 and 2003 respectively and the said amounts have been reflected in the income tax return. In the cross examination, the applicant was called upon to file copies of the income tax return. However, he did not produce the said returns before the court. The learned Judge has also referred to the factual position that the said transaction was not shown in his books of account. Therefore, the learned Judge came to the conclusion that the transaction appears to be in respect of an unaccounted amount. 5. By a Judgment and Order dated 24th February 2009 in Criminal Application No.4694 of 2008 this court has already taken a view that presumption under section 139 of the said Act extends only to the fact that the cheque was issued - 4 - towards a liability or debt, but the presumption does not extend to the fact that the liability or debt was a legally enforceable debt or liability. This court has already held in the said decision that the liability to repay the amount allegedly advanced by the complainant which is an unaccounted amount cannot be said to be a legally enforceable liability. As far as decision of this court in the case of Dilip (supra) is concerned, the said decision has been explained by this court in case of Rammonarath Ram Adhin Dubey Vs. Shyamprakash Parasnath Mishra and others delivered in Criminal Application No.3964 of 2007 decided on 16th January 2009. This court has held in the said decision that in the case of Dilip (supra) does not lay down any proposition of law and the said decision has been rendered in the peculiar facts of the case. 6. The applicant admitted that his bank balance was only of Rs.40,000/- on the day on which loan was advanced. He admitted that the amount of alleged loan was not disclosed in the books of account and in the income tax returns. In the present case, going by the statements of the applicant, the amount of Rs.13,50,000/- allegedly advanced was obviously an "unaccounted amount". In fact this was a case where presumption under section 139 of the said Act stood rebutted. Apart from this, it is obvious that alleged liability pleaded by the applicant cannot be said to be a legally enforceable liability. - 5 - 7. Hence, the view taken by the learned trial Judge is certainly a possible view and no interference is called for in this application for leave to prefer an appeal. 8. It is made clear that the observations made in this order are for limited purpose of considering the prayer for grant of leave and none of the observations shall be construed as any finding on the rights and liabilities of the parties. JUDGE JUDGE JUDGE