IN THE HIGH COURT OF KERALA AT ERNAKULAM
CRL.A.No. 852 of 2001()
1. ALI HASSAN
... Petitioner
Vs
1. K.M. VARGHESE
... Respondent
For Petitioner :SRI.DINESH R.SHENOY
For Respondent :PUBLIC PROSECUTOR
The Hon'ble MR. Justice S.S.SATHEESACHANDRAN
Dated :06/04/2009
O R D E R
S.S.SATHEESACHANDRAN, J.
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CRL.APPEAL.NO.852 OF 2001 ()
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Dated this the 6th day of April, 2009
J U D G M E N T
Complainant is the appellant. His complaint against the
1st respondent, hereinafter referred to as the ‘accused’ for the
offence punishable under Section 138 of the Negotiable
Instruments Act, in short, the ‘N.I.Act’, after trial, ended in a
judgment of acquittal rendered in favour of the accused.
Impeaching the correctness of that acquittal, the complainant
has filed this appeal.
2. The case of the complainant is that towards discharge
of a liability, the accused issued two cheques to him, one for
Rs.45,000/- and another for Rs.50,000/-, promising
encashment on presentation of the instrument before the bank
in due course. The cheques presented, was however,
dishonoured due to insufficiency of funds in the account
maintained by the accused. Statutory notice issued intimating
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dishonour and demanding the sum covered by the cheques
was responded with a reply notice raising untenable
contentions. The amount under the cheques having been not
paid, the complainant launched prosecution against the
accused for the offence punishable under Section 138 of the
N.I.Act.
3. The accused on appearance, pleaded not guilty when
the particulars of the offence were made known. Complainant
examined himself as PW1 and got marked Exts.P1 to P9 to
prove his case. The accused, when questioned under Section
313 of the Cr.P.C., maintaining his innocence advanced a
defence that he had a transaction relating to the sale of
property with the complainant. His defence was that a
property belonging to the wife of the complainant was agreed
to be sold to his wife and another property belonging to him
was agreed to be purchased by the complainant. Though the
transaction relating to the sale of the property of the
complainant’s wife to his wife materialised the transaction
relating to the sale of his property to the complainant, could
not be completed due to the default of the complainant. He
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had received an advance of Rs.1,20,000/- from the
complainant on execution of the agreement of sale for his
property, and towards security for the amount received, three
cheques had been collected by the complainant. Sum of
Rs.50,000/- out of the advance received was repaid and then
one of the cheques was returned. The other two instruments
were retained by the complainant, who after presenting them
and on dishonour of the instruments, had foisted the present
case, was the defence of the accused. Though such a defence
was canvassed, no evidence was adduced to support thereof.
4. The leaned Magistrate, after considering the
materials produced was of the view that the case of the
complainant was not acceptable for the reason that even by
his evidence, as borne out by answers given by him in his
cross examination, the liability, if any, the accused had was
only with the wife of the complainant and he had no debt or
liability to be discharged to the complainant. Since the
accused had no debt or liability to be discharged to the
complainant, the learned Magistrate was of the view that on
the basis of Exts.P1 and P2 cheques, he had no competency to
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launch prosecution against the accused even if those
instruments on presentation had been dishonoured. In
forming such conclusion, the case of the complainant was
repelled and the learned Magistrate passed the impugned
judgment acquitting the accused of the offence imputed.
5. The main thrust of attack pressed into service by the
learned counsel for the complainant assailing the impugned
judgment of acquittal is that in order to prosecute the accused
for the offence under Section 138 of the N.I.Act, the cheque
dishonoured need not be issued to discharge the debt or
liability of the payee or the holder in due course of the
instrument and it could be the debt or liability of any other
person. The learned counsel relied on Alexander v. Joseph
Chacko (1993 (2) KLT 326) to contend that it is not
necessary that a debt or liability should be due from the
drawer. Complainant had tendered sufficient legal evidence
to prove his case and there was no counter evidence from the
accused to substantiate his defence is also canvased by the
learned counsel to assail the conclusion formed by the learned
Magistrate that the complainant could not sustain prosecution
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of the accused without proving that the instruments had been
given to discharge liability or debt due to him from the
accused.
6. I have perused the records of the case giving
consideration to the submissions made by the counsel. The
learned Magistrate has found fault with the complainant, for
not producing the sale deed executed in favour of his wife by
the wife of the accused to substantiate his case that part of the
sale price covered by that document remained to be
discharged. Another ground to disbelieve the case of the
complainant was that the cheques had been issued for
discharging a liability due to his wife under the sale of
property to the wife of the accused, and, so much so, she alone
was competent to proceed against the accused and not the
complainant. Perusing the evidence of the complainant
examined as PW1, it is seen that when a suggestive question
was put to him that he had paid Rs.1,20,000/- as advance to
purchase the property of the accused, his answer was that the
sum paid was on a lesser side, that is, Rs.70,000/- only. The
suggestive questions put and the answers given had to be
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appreciated in the backdrop of the defence canvassed by the
accused that for collecting the advance, he had issued three
cheques and one of them was returned later when a sum of
Rs.50,000/- was repaid on the sale falling through and the
remaining two cheques had been used for filing the complaint.
The evidence of the complainant, PW1, it is seen, has a ring of
truth and on the contrary, the defence canvassed by the
accused which remained unsubstantiated by any material,
whatsoever other than his self serving statement made at the
time of his questioning under Section 313 of Cr.P.C. indicate
that the plea canvassed was bereft of any bona fide and was
pressed into service to wriggle out of the penal consequences
arising on dishonour of the cheques issued by him. Even the
suggestive questions put by the accused would indicate that
he had some liability to be discharged towards the
complainant. The accused had no explanation nor even any
case that the cheques had been issued in blank form with
signature alone. Admittedly, he has no dispute regarding his
signatures in the instruments, Exts.P1 and P2. The reply
notice sent by him has also not been tendered in evidence.
He has not mounted the box to swear in support of his
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defence. All these circumstances were ignored by the learned
Magistrate in appreciating the sworn testimony of the
complainant who as already stated asserted that a lesser
amount alone had been paid by him as advance though a
suggestion was made that he had paid a much higher amount.
The decision relied by the learned counsel for the complainant
in Alexander v. Joseph Chacko (1993 (2) KLT 326) refers
to a different situation not similar to the facts involved in the
present case. A cheque can be issued by the maker of the
instrument to discharge the debt or liability of another and it
need not be his debt or liability, was the view taken in that
decision. In the present case, the factual aspects involved are
somewhat different. The complainant in evidence stated that
on the sale of the property of his wife to the wife of the
accused, a sum of Rs.1,00,000/- was due, for which the
accused had issued two cheques. The learned Magistrate was
of the view that if at all anybody had any claim over that sum,
it could be only the wife of the complainant, and not the
complainant. On the facts presented in the case whether the
case of the complainant is acceptable has to be looked into.
Whether the cheque had been issued in relation to a
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transaction, as presented by the complainant, can be treated
as honest and bona fide, also merits consideration. If the
court is satisfied that the transaction alleged by him is honest
and bona fide and if it is proved that the accused had issued
the cheques to discharge a debt or liability, whether it be his
own or of his wife or another, towards the complainant or his
wife, he cannot escape from the penal consequences once the
instruments were dishonoured due to insufficiency of funds in
his account. The defence of the accused would indicate that
he had not returned the entire advance collected from the
complainant. His liability under the cheques dishonoured is
borne out by his defence. So, on careful scrutiny of the
materials produced in the case, in reversal of the judgment of
acquittal passed in favour of the accused, I find him guilty of
the offence under Section 138 of the N.I.Act and convict him
thereunder.
7. Now on the question of sentence, the incarceration of
the accused for a term having regard to the nature of the
offence involved is not necessary to meet the ends of justice.
The accused is sentenced to undergo imprisonment till the
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rising of the court and to pay a compensation of Rs.95,000/-,
the amount covered by the cheques, under Section 357(3) of
the Cr.P.C. to the complainant within two months from the
date of this judgment. In default of payment of the
compensation, the accused shall undergo simple imprisonment
for two months. The accused shall appear and his sureties to
produce him before the Judicial First Class Magistrate Court,
Irinjalakuda, on 1st July 2009, and the learned Magistrate shall
execute the sentence as directed.
Appeal is allowed.
S.S.SATHEESACHANDRAN
JUDGE
prp
S.S.SATHEESACHANDRAN, J.
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CRL.A.NO.852 OF 2001 (C)
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J U D G M E N T
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6th April, 2009