No Valid Documentary Evidence Produced For Substantiating Any Enforceable Debt Or Liability: SC Upholds Acquittal In Cheque Dishonour Case
The Supreme Court upheld an acquittal in a cheque dishonour case stating that no valid documentary evidence was produced by the complainant for substantiating the existence of any enforceable debt or liability.
M/S Rajco Steel Enterprises, a partnership firm, lodged a complaint alleging that the respondent issued four cheques totalling Rs. 7.75 crore, which were dishonoured due to insufficient funds. The firm contended that it had provided financial assistance to the respondent, for which the cheques were issued to discharge the liability.
However, the defence asserted that the cheques were not issued for any debt owed to the firm but were related to stock market transactions conducted through the respondent’s account.
Justice Aniruddha Bose and Justice Sanjay Kumar observed, “The whole question involved in this proceeding is as to whether the cheques were issued in discharge of a debt and if it was so, then whether the accused/respondent no.1 was able to rebut the presumption in terms of Section 118 read with Section 139 of the 1881 Act.”
Sr. Advocate Raju Ramchandran represented the petitioner, while Sr. Advocate S. Nagamuthu appeared for the respondents.
Despite the firm’s claims, the Trial Court, First Appellate Court, and the High Court found insufficient evidence to establish the existence of a legally enforceable debt upon the respondent.
The Supreme Court noted that the First Appellate Court exercising its jurisdiction under Section 374(3) of CrPC had acquitted the respondent, which was further upheld by the High Court. Secondly, the other partners of the firm did not depose as prosecution witnesses to establish that the cheque-amounts were advanced to the accused as financial assistance.
The Court remarked, “The respondent no.1/accused has put up a plausible defence as regards the reason for which the petitioner’s funds had come to her account. Both the appellate fora, on going through the evidence did not find existence of any “enforceable debt or other liability”. This strikes at the root of the petitioner’s case.”
Accordingly, the Supreme Court dismissed the petitions.
Cause Title: M/S Rajco Steel Enterprises v. Kavita Saraff & Anr. (Neutral Citation: 2024 INSC 288)
Appearance:
Petitioner: Sr. Advocate Raju Ramchandran; AOR Avnish Pandey
Respondents: Sr. Advocate S. Nagamuthu; AOR Mohit D. Ram and Astha Sharma; Advocates Monisha Handa, Rajul Shrivastav, Anubhav Sharma, Srisatya Mohanty, Anju Thomas, Sanjeev Kaushik, Mantika Haryani, Shreyas Awasthi, Himanshu Chakravarty, Ripul Swati Kumari, Bhanu Mishra, Muskan Surana, Anvita Dwivedi and Lihzu Shiney Konyak