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COMPLAINANT BOUND TO DISCLOSE HIS FINANCIAL CAPACITY WHEN ASKED BY ACCUSED IN CHEQUE BOUNCE CASE: Supreme Court

Team SoOLEGAL 10 Apr 2019 10:25am

COMPLAINANT BOUND TO DISCLOSE HIS FINANCIAL CAPACITY WHEN ASKED BY ACCUSED IN CHEQUE BOUNCE CASE: Supreme Court

In the case of Basalingappa, the financial capacity of the complainant was questioned by the accused. From 2009-November 2011, the complainant had given a total of Rs. 18 lakhs to several person, one of them being the accused.  The accused focused on the fact that the complainant is a retired person and he had encashed his retirement benefits worth Rs. 8,00,000. Thus, he did not bear any financial capacity. The accused was acquitted by the Trial Court but the High Court bench comprising of Justice Ashok Bhushan and Justice KM Joseph had declared him as a convict.

It was observed by the bench that at the time of evidence produced in the High Court, it was incumbent on the complainant to have explained his financial capacity.

However Supreme Court's observation is that a complainant in a cheque bounce case is bound to explain his financial capacity, when the same is questioned by the accused, by leading evidence to that effect. The Court referred to some decisions involving Section 118(a) and 139 of the Negotiable Instruments Act.

Some of the principles which were summarized are as follows

·         That it is not necessary for the accused to come in the witness box in support of his defence, Section 28 139 imposed an evidentiary burden and not a persuasive burden. 

·         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.

·         Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.

However Supreme Court's observation is that a complainant in a cheque bounce case is bound to explain his financial capacity, when the same is questioned by the accused, by leading evidence to that effect. The Court referred to some decisions involving Section 118(a) and 139 of the Negotiable Instruments Act.

Tagged: Justice Ashok Bhushan   Justice KM Joseph   Supreme Court   Negotiable Instruments Act   Section 138  
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