Ajitsinh Chehuji Rathod vs. State of Gujarat & Anr.
Background
The appellant was convicted by the trial court under Section 138 of the Negotiable Instruments Act after a cheque for Rs. 10 lakh issued by him was dishonoured for "insufficient funds and account dormant." During trial, he had sought to send the cheque for handwriting comparison alleging his signature was forged, but the trial court rejected this as a delaying tactic, a ruling he never challenged further. After conviction, during his appeal before the Sessions Judge, he applied under Section 391 CrPC for additional evidence, a handwriting expert's opinion and testimony from a post office official to show he never received the statutory notice, which was rejected, and the Gujarat High Court declined to interfere.
Decision Breakdown
The Supreme Court held that the power to record additional evidence under Section 391 CrPC is meant only for situations where a party was genuinely prevented from presenting evidence at trial despite due diligence, which was not the case here since the appellant had already litigated and lost the handwriting-comparison issue at trial and let that order attain finality. The Court noted that the bank's own cheque return memo cited "insufficient funds," not a signature mismatch, undermining the forgery claim, and that under Section 118 of the NI Act, indorsements on a negotiable instrument are presumed genuine unless rebutted with evidence, which the appellant had failed to do despite opportunity to question the bank's witness at trial. Finding no fault in the lower courts' orders, the Supreme Court dismissed the appeal.
Lesson Learnt
In cheque-bounce cases, the law presumes the instrument and its signatures are genuine unless the accused actively rebuts that presumption with evidence at the appropriate stage (trial). Courts will not allow a second opportunity to introduce evidence at the appellate stage that could have been, but was not, pursued earlier through due diligence.