IN THE HIGH COURT OF KERALA AT ERNAKULAM
CRL.A.No. 242 of 2002()
1. M.PRABHAKARAN, S/O. MEENAPPA MOOTHAN,
... Petitioner
Vs
1. MOHANDAS, S/O.NARAYANA PANICKER,
... Respondent
2. STATE OF KERALA, REPRESENTED BY PUBLIC
For Petitioner :SRI.P.VIJAYA BHANU
For Respondent :SRI.V.CHITAMBARESH
The Hon'ble MR. Justice S.S.SATHEESACHANDRAN
Dated :27/03/2009
O R D E R
S.S.SATHEESACHANDRAN, J.
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CRL.A.NO.242 OF 2002 (A)
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Dated this the 27th day of March, 2009
J U D G M E N T
Complainant is the appellant. The complaint filed by him
for prosecuting the respondents/accused for the offence
punishable under Section 138 of the Negotiable Instruments
Act, for short the ‘N.I.Act’, after trial, ended in a judgment of
acquittal in favour of the accused. Challenging the legality,
propriety and correctness of that acquittal, he has preferred
this appeal.
2. The case of the complainant is that, the accused had
borrowed a sum of Rs.50,000/- from him executing a
promissory note agreeing to repay the sum with interest at
18% per annum. Subsequently, when demand was made for
repayment, it is his case that Ext.P1 cheque was issued for a
sum of Rs.60,000/-, promising its encashment on presentation
in due course. The cheque presented was, however,
CRL.A.242/02 2
dishonoured due to insufficiency of funds in the account of the
accused. Statutory notice issued intimating dishonour of the
cheque and demanding the sum covered by the instrument
was responded with a reply notice raising untenable
contentions. The accused in the reply notice contended that
he was a subscriber to a chitti conducted by the complainant
and on prizing of chitti, the prize amount was given only after
collecting a blank signed cheque and also a blank signed
stamped paper as security for payment of future subscriptions
to the chitti. Though he had paid the future subscriptions and
the chitti had been terminated, the blank signed stamped
paper and also the blank cheque were not returned, and
misusing that cheque, it is his case, the complaint had been
filed on false allegations. In the light of the reply as above,
the complainant launched the prosecution against the accused
for the prosecution under Section 138 of the N.I.Act.
3. The accused, on appearance, pleaded not guilty.
Complainant examined himself as PW1 and got marked
Exts.P1 to P6. During the course of the cross examination of
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the complainant as PW1, and also when questioned under
Section 313 of the Cr.P.C., reiterating his plea of innocence,
the accused pressed with the defence version already
canvassed in his reply notice. To substantiate his defence,
the accused examined one witness as DW1, who claimed to be
present when the blank signed stamped paper and also blank
cheque were obtained by the complainant from the accused.
The accused also produced a document to show the collection
of the blank signed stamped paper and blank cheque, and it
was exhibited as Ext.D1.
4. The learned Magistrate, after appreciating the
materials tendered in the case, came to the conclusion that
the defence canvassed by the accused is probable and the
complainant had not proved by cogent and convincing
evidence that Ext.P1 cheque had been issued towards
discharge of a debt or liability. In that view of the matter, the
accused was found not guilty and he was acquitted of the
offence imputed under Section 138 of the N.I.Act.
CRL.A.242/02 4
4. I heard the counsel of both sides. The learned
counsel for the complainant urged before me that the learned
Magistrate misappreciated the evidence and it had resulted in
forming wrong conclusion leading to miscarriage of justice.
The complainant had established by the materials produced
that Ext.D1 cheque was duly executed by the accused towards
discharge of a debt and it was supported by other exhibits
produced by the complainant in the case. The learned
Magistrate, according to the counsel for the complainant, gave
unmerited consideration to innocuous circumstances to hold
that the defence canvassed by the accused is probable. The
documents produced by the complainant to show that a blank
signed stamped paper and also a blank cheque exhibited as
Ext.D1 was found unreliable by the learned Magistrate. It was
also found that the evidence tendered through the witness
DW1, as to witnessing the transaction was also not credit
worthy. The accused also did not mount the box to swear in
support of his defence. Still the learned Magistrate, according
to the learned counsel, found fault with the complainant for
not proving the execution of Ext.P1 cheque and also the
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transaction under which that cheque was issued to have a
successful prosecution of the accused for the offence indicated
against him. Acquittal of the accused is based on erroneous
reasonings, and as such, it is liable to be reversed, is the
submission of the learned counsel for the complainant. On the
other hand, the learned counsel for the accused submitted
that even the admitted case of the complainant as to collecting
a promissory note and retaining that negotiable instrument,
while prosecuting the accused for the offence under Section
138 of the N.I.Act, lend credence to the defence canvassed by
the accused that the cheque had been issued in blank form
with signature alone as a security. When due execution of
Ext.P1 cheque had not been established, it is submitted the
case set up against the accused was rightly found against by
the learned Magistrate, and at any rate in the proved facts and
circumstances of the case, no interference with the acquittal is
called for.
5. I have gone through the records of the case giving
consideration to the submissions made by the counsel of both
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sides. It has to be noted that the definite case of the
complainant right from inception, even from his notice
intimating dishonour of the cheque is that he had advanced
Rs.50,000/- to the accused collecting a promissory note from
him and transaction, was agreed to be settled by repayment
with 18% interest per annum. Later, when demand was made
for repayment with the interest due, the accused issued a
cheque for Rs.60,000/- and that cheque, when presented, was
dishonoured, was his case. He had retained the promissory
note, while prosecuting the accused on dishonour of the
cheque, is taken serious exception by the learned Magistrate
as a circumstance which affects the merit of his complaint. I
do not find any merit in the reasoning so taken by the
Magistrate where the complainant was candid enough to
admit that the promissory note had been retained by him and
the cheque had been issued towards discharge of the sum
covered by the note. In evidence also he would state that he
had handed over the promissory note and also the cheque to
his counsel. At any rate, the accused has no case that any
proceedings was taken for realisation of the sum covered by
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the promissory note separately. If at all the promissory note
was retained by the complainant, when the cheque was
handed over, the accused should have collected that
instrument. The facts and circumstances would indicate that
the promissory note was retained by the complainant perhaps,
to assure the honouring of Ext.P1 cheque handed over by the
accused. The interest agreed upon by the parties for
repayment of the sum covered by the promissory note was
18% per annum. If a calculation was made, with such an
interest, the sum would come to Rs.60,500/- on the date when
the cheque was handed over was another reason which
prompted the learned Magistrate to hold that the cheque
might have been handed over in blank form. The reasoning of
the Magistrate as indicated to say the list, deserves no merit
at all. It is the specific case of the complainant that when the
sum was demanded, the accused issued a cheque for
Rs.60,000/-. The sum stated in the cheque did not reflect the
interest due till that date, is not a ground to doubt the worth
of that instrument. Other than the two circumstances, as
referred to above, no other reason is stated by the learned
CRL.A.242/02 8
Magistrate to doubt the case set up by the complainant. Both
the reasonings, it has been found, is thoroughly unacceptable.
Now the question to be considered is whether in view of the
defence set up by the accused that the cheque had been
issued in blank form with signature alone, the complainant is
bound to prove the transaction and also that the instrument
had been handed over duly executed with all the entries filled
up. Merely by setting up a defence that the cheque was
issued in blank form with signature alone, without anything
more, no burden is cast upon the complainant to show that
the instrument had been duly executed. If that be so, the
presumption covered by Section 118 and also Section 139 of
the N.I.Act would be rendered meaningless. If only the
circumstances disclosed and materials produced indicate that
the defence pleaded that the cheque had been issued in blank
form with signature is probable, then alone the presumption
under Section 139 can be considered as rebutted demanding
proof from the complainant that the instrument had been
issued towards discharge of a debt or liability. Even the
Magistrate has found that whatever materials tendered by the
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accused to prove his defence, by examining DW1 and
exhibiting D1, is of no avail and has no merit in advancing his
defence. The evidence of the witness, DW1 was found totally
unreliable. A carbon copy was exhibited as Ext.D1 to show
that the complainant had acknowledged the receipt of a blank
signed stamped paper and also a blank cheque. The learned
Magistrate examining that document found that it is of no
value, and further observed that prude man could be expected
to execute such a document for collecting a blank signed
cheque as security. After finding that the defence canvassed
by the accused is not substantiated by any material, the case
of the complainant was thrown out holding that the defence of
the accused is probable. Not only in the materials produced
by the accused there is nothing to show that his defence is
probable, but, on the contrary, by his own evidence, it has
been proved that his defence is unworthy of any value.
Merely because, the complainant had retained the promissory
note, which he was fair enough to concede right from the
inception, even before launching the prosecution against the
accused, his case cannot be doubted. Sworn testimony of the
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complainant, PW1, would convincingly show that Ext.P1
cheque had been issued by the accused towards discharge of a
debt which he had with the complainant. It has also been
established that the cheque was dishonoured due to
insufficiency of funds in the account of the accused, and
despite a notice of dishonour, the sum under the instrument
was not discharged. In the proved facts of the case, in
reversal of the judgment passed in favour of the accused, I
find the accused guilty of the offence under Section 138 of the
N.I.Act and convict him thereunder.
6. Now on the question of sentence, I find that
incarceration of the accused for a term is not called for in the
proved facts and circumstances of the case. The accused is
sentenced to undergo till the rising of the court and to pay a
compensation of Rs.55,000/- to the complainant under Section
357 (3) of the Cr.P.C. within two months. If compensation is
not paid within the time fixed, the accused shall undergo
simple imprisonment for a period of three months. The
accused shall appear and his sureties to produce him on
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1st July, 2009, before the Judicial First Class Magistrate,
Palakkad, 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.242 OF 2002 (A)
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J U D G M E N T
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27th March, 2009