1 appln 2260 of 2006 vks IN THE HIGH COURT OF JUDICATURE AT BOMBAY CRIMINAL APPELLATE JURISDICTION CRIMINAL APP NO.2260 OF 2006 Ganga Prasad Sharma .. Applicant -versus State of Maharashtra and another .. Respondents. Mr. V . K. Singh, for the Applicant. Mr. P. R. Dave, for Respondent NO.2. Mr. S.A. Shaikh, APP for the Respondent State. CORAM: R.C. CHAVAN, J. DATED: 29th July, 2011 P.C. 1. This is an application for leave to file appeal against judgment of acquittal, rendered by the learned Metropolitan Magistrate, 31st Court, Vikhroli, Mumbai for the offence punishable under Section 138 of the Negotiable Instruments Act, on the ground that the cheques in question were issued more than three years after the loan was advanced and therefore, they were time for barred debt. 2. The question as to whether mere issuance of a cheque would revive a time barred debt, has elicited divergent responses in the judgments of this Court and therefore a learned single Judge has already referred the question to a Division Bench by the order dated 23-9-2008, passed in Criminal Application No.2933 of 2007 with 2 appln 2260 of 2006 connected matters {Dinesh B. Chokshi v. Rahul Vasudeo Bhatt and Anr.}. A copy of the order making the reference was also made available for my perusal. 3. The contention raised enabled me to re-examine the rationale of my judgment referred to in the order making the reference, apart from the judgment dated 21-7-2008, delivered in Shri Shyamsundar Babu Naik Dessai-vs- Shri. Baban Anant Naik and anr,reported in(2008)All M.R. (Cri) 2376. The order whereby the reference is made indicates that mere issuance of a cheque cannot amount to a written promise to pay a time barred debt within the meaning of Section 25 of the Contract Act. The learned Judge making the reference has referred to the definition of “bill of exchange” and “cheque” in the Act and concluded that nature of agreement is not writ large on the face of a cheque and that the cheque is merely a direction to the Bank and its issuance simpliciter will not amount to making a promise to the payee. 4. In view of this, I have re-examined as to what is a cheque or a bill of exchange if not a contract and who promises what to whom in a cheque. There should be no doubt about the proposition that every negotiable instrument represents a contract, since the rights and liabilities of the parties to the negotiable instrument flow from what they agree to do and not from any civil wrong (tortious liability). 3 appln 2260 of 2006 The parties to the negotiable instruments are not obliged under any statute to enter into or be parties to a negotiable instrument. They, of their own volition, make or receive such instrument and, therefore, negotiable instruments denote a special type of a contract. A cheque cannot be construed as anything but an order to a Banker to pay the amount mentioned on the cheque to the payee. The beneficiary is the payee and not the Banker and therefore the Act provides for a mechanism for the payee to enforce payment and gives him a right to sue on dishonour of such an instrument. Therefore, though payment is required to be made by the Banker who is merely custodian of drawer’s money, the payment, is obviously on behalf of the drawer of the instrument and therefore the cheque signifies a promise by the drawer to pay to the payee the sum mentioned in the cheque. In view of this, it is not clear as to why a cheque, which is a promise made in writing and signed by the person who can be charged therewith to pay a particular sum to the payee, which payment could have been enforced by the payee, but for the law of limitation, would not qualify to be an agreement under Section 25 of the Contract Act. If a cheque is a contract to pay a certain sum, then it will itself evidence an obligation which is legally enforceable to pay a debt. 5. A view has been taken that such a cheque itself 4 appln 2260 of 2006 may not be evidence of existence of a legally enforceable liability and such evidence has to be furnished by some other documents. It is not clear as to why there should be an insistence on existence of any other collateral document to evidence the existence of a legally enforceable liability. This, in my humble opinion, would be reading something which the statute does not prescribe and injecting technicalities in a law which was supposed to be simple. Unless the statute requires that the liability should be evidenced by some other document, apart from the cheque, it would be impermissible to so require. 6. In any case, the entire debate may only be academically significant in view of the decision of a Three Judge Bench of the Supreme Court in Rangappa v. Mohan, reported in 2010 Cri.L.J. 2871. In Rangappa v. Mohan the Supreme Court had considered an earlier decision of its Two Judge Bench in Krishna Janardhan Bhat v. Dattatraya G. Hegde, reported in 2008 All MR (Cri.) 1164 (SC). In Krishna Janardhan Bhat the argument was that the ingredients of Section 138 of the Act, namely, that the drawer of the cheque issued the cheque to satisfy part or whole of the debt only was the subject-matter of presumption under Section 139 of the Act and not that there is a legally enforceable debt. After considering several judgments, as also the requirement of 5 appln 2260 of 2006 Section 271D of the Income-Tax Act, the Bench held in para 21 of the decision that Section 139 of the Act merely raises a presumption that the cheque was drawn for discharge in whole or in part of any debt or other liability and that existence of a legally recoverable debt is not a matter of presumption under Section 139 of the Act. 7. This view taken by the Division Bench came in for scrutiny in Rangappa’s case (supra) and the Three Judge Bench of the Supreme Court held in para 14 of the Judgment that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. Thus, the moment a cheque is shown to have been issued, a presumption would have to be drawn about existence of a legally enforceable debt or liability. Therefore, whether the cheque was issued in respect of a claim which could not have, but for the cheque, been made before a Civil Court, on account of the law of limitation, would become irrelevant and the cheque would have to be presumed to have been issued for a legally enforceable debt or liability, though the presumption would always be rebuttable. 8. In view of this, leave granted. Appeal admitted. Call for the R & P. Since the respondent No.2 is already represented by an Advocate, action under Section 390 of 6 appln 2260 of 2006 Cr.P.C. is not necessary. The application accordingly stands disposed of. (R. C. CHAVAN, J.)