Section 138 NI Act: Production Of Account Book Not Relevant In Cheque Bounce Cases: SC [Read Order]

The Supreme Court has observed that the production of the account books/cash book may not be relevant in a criminal case filed under Section 138 of the Negotiable Instruments Act.

In this case, the First Appellate Court, while reversing the Trial Court order convicting the accused, had held that the complainant did not produce cash and account books to prove that the amount was due and payable by the accused. The complaint was that the accused purchased the pesticides on credit from the company and made part payments by issuing a cheque, which when presented for collection returned with the endorsement "insufficient funds".

While restoring the Trial Court judgment, the High Court observed that "the reason given by the lower Appellate Court that he did not bring the cash book or order book etc. could well be understood, if civil suit is tried" but on the contrary the order passed by the lower Appellate Court is in the criminal case filed under Section 138 of the N.I. Act.

Upholding this view, the bench comprising Justices R. Banumathi and AS Bopanna observed:

As held by the Trial Court as well as by the High Court that the cheque was issued towards the amount due and payable by the appellant for purchase of pesticides. As rightly observed by the High Court production of the account books/cash book may be relevant in the civil court; but may not be so in the criminal case filed under Section 138 of the N.I.Act. This is because of the presumption raised in favour of the holder of the cheque. In view of the concurrent findings recorded by the Trial Court as well as by the High Court we do not see any ground warranting interference with the conviction of the appellant under Section 138 of the N.I.Act 

Case name: D. K. CHANDEL vs. M/S WOCKHARDT LTD.
Case no.: CRIMINAL APPEAL NO(S). 132 OF 2020
Coram:  Justices R. Banumathi and AS Bopanna
Counsel for Appellant: Adv Yadav Narender Singh
Counsel for Respondent: Adv Saman Ahsan 

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