IN THE HIGH COURT OF KERALA AT ERNAKULAM
CRL.A.No. 1897 of 2004()
1. N.JACOB PAUL, NETTARAKONATHU VEEDU,
... Petitioner
Vs
1. C.GOPALAN, SEETHANKUZHI KUNNIL VEEDU,
... Respondent
2. STATE OF KERALA,
For Petitioner :SRI.L.MOHANAN
For Respondent : No Appearance
The Hon'ble MR. Justice M.L.JOSEPH FRANCIS
Dated :18/11/2010
O R D E R
M. L. JOSEPH FRANCIS, J.
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Crl.Appeal No: 1897 of 2004
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Dated this the 18th day of November 2010
JUDGMENT
This appeal is filed by the complainant in C.C. No. 342 of
2000 on the file of Judicial First Class Magistrate Court – I
Neyyattinkara. The first respondent herein was the accused in that
case, which was filed by the complainant alleging the commission
of an offence under Section 138 of N.I. Act.
2. The case of the complainant is briefly as follows. The 1st
respondent/accused borrowed a sum of Rs.31,000/- from the
complainant on 18.12.1999. To discharge the said debt the accused
issued two cheques both dated 18.2.2000 for Rs.16,000/- and
Rs.15,000/- respectively drawn on Vellanadu Service Co-operative
Bank. When the cheques were presented for encashment through
his bank namely, the Thiruvananthapuram District Co-operative
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Bank Ltd., it was returned due to insufficiently of funds, of which
information from the bank was obtained by the appellant on
20.3.2000. Therefore the complainant had demanded payment of
money through lawyer’s notice dated 30.3.2000. But the accused
did not pay the amount. Therefore the complaint was filed.
3. Before the trial court appellant examined himself as PW1
and Exts. P1 to P8 were marked. On the side of the 1st respondent, a
witness was examined as DW1 and Exts. D1 and D2 were marked.
The defence of the first respondent was that he borrowed sum of
Rs.20,000/- from the appellant and issued 5 blank signed cheques.
The appellant then filed a case by using one of the cheques and
claiming a sum of Rs.40,000/- The respondent paid the amount and
got the matter settled. Though that cheque was returned, it was told
that the rest of the cheques were destroyed by him. On receipt of
the lawyers notice when contacted, he was told that he should pay
the expenses met for the earlier case. Therefore the 1st respondent
states that the present cheques are without consideration.
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4. The court below on the reason that the present cheque
being anterior in serial number to Ext. D1 cheque assumed that it
must have been issued earlier and therefore the evidence of the
appellant is not sufficient to prove the case and the 1st respondent
was acquitted. Against the judgment of the acquittal the
complainant filed this appeal.
5. Heard the learned counsel for the appellant and learned
Public Prosecutor.
6. The learned counsel for the appellant submitted that the
court below should have found that the complainant had proved all
the necessary ingredients of the offece under Section 138 of N.I.
Act against the accused and that the statutory presumption under
Section 139 of N.I. Act has not been rebutted by the accused . The
learned counsel further submitted that the court below should have
noted that there was no impediment on the appellant to state about
the Ext.P1 and P2 cheques in Ext.D2 and that the non-mentioning
of the other cheques in Ext.D2 cuts the roots of the defence case.
The learned counsel for the appellant submitted that the court below
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ought to have considered the fact that no reply was sent by the
accused to Ext.P6 lawyer notice. He further submitted that
assumption of the court below that Ext.P1 and P2 cheques bearing
Serial numbers anterior to Ext.D1 could not be issued at a later
stage is without basis and that it is not human course of conduct to
verify the cheque numbers on each occasion when cheques are
received from another at difference intervals. The learned counsel
for the appellant submitted that the approach of the court below
suspecting the receipt of two cheques for the amounts is also
without any basis.
7. When the accused was questioned under Section 313
Cr.P.C. his case is that he borrowed an amount of Rs.20,000/- from
the complainant. At that time he issued 5 blank signed cheques to
the complainant. The complainant then filed a case before Judicial
First Class Magistrate Court, Kattakkada by using one of the
cheques. He claimed an amount of Rs.40,000/- in that case. The
accused finally paid the entire amount to the complainant and got
the matter settled. The complainant returned the cheque used for
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filing the complaint before that court alone to the accused. He
informed the accused that rest of the cheques were destroyed by
him. While so the accused received a notice demanding the amount
covered under Ext.P1 and P2. When the complainant was
contacted, he told the accused that he should be given the expense
he met for prosecuting the earlier case. The accused, hence submits
that two of the cheques retained by the complainant are used for
filing this complaint without any consideration.
8. For proving the defence the accused examined one of his
neighbours as DW1. According to DW1 the accused borrwed an
amount of Rs.20,000/- from the complainant in January 1998. Five
cheuqes were issued by the accused towards security. Exts.P1 and
P2 included among those cheques. He further testified that the
accused repaid the entire amount by making payment of Rs.200/-
each for 115 days consecutively. A case was filed by the
complainant against the accused before the court at Kattakkada, got
settled after repaying the entire cheque amount. The cheque
involved in that case was returned to the accused as per an
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agreement entered into between the complainant and the accused.
Ext.D1 is the cheque returned to the accused. Ext.D2 is the receipt
issued by the complainant at the time of settling that case.
9. In cross examination DW1 admitted that he has no full
knowledge about the financial transaction of the accused. Ext.D1 is
the cheque dated 3.6.1998 for Rs.40,000/- which was returned to
the accused when the case pending before Kattakkada Court was
settled between the complainant and accused. Ext.D2 is the letter
dated 24.7.1999 issued by the complaint to the accused stating that
as the accused paid the entire amount of the cheque for Rs.40,000/-
the case pending before the Kattakkada Court will be withdrawn by
him. In Ext.D2 nothing is stated about the Ext.P1 and P2 cheques
involved in this case. Serial number of Ext.D1 cheque is 0226,
serial number of Ext.P2 cheque is 0223 and that of Ext.P2 cheque is
0221. The mere fact that Ext.D1 cheque bears a posterior serial
number than Ext.P1 and P2 cheques is not sufficient reason to
accept the case of the accused that he gave 5 blanks cheques when
he borrowed Rs.20,000/- in January 1998.
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10. The complainant is examined as PW1. He deposed that
on 18.12.1999 the accused borrowed Rs.31,000/- from him. The
accused then issued two cheque for the said amount to be encashed
after two months. Cheque number 221 was issued for Rs.15,000/-
and cheque No.223 was issued for Rs.16,000/-. Both the cheques
were dated 18.2.2000 and drawn on Vellanad Service Co-operative
Bank Ltd., Vellanad. The cheques are marked as Exts. P1 and P2.
11. PW1 stated that he presented Exts.P1 and P2 cheques for
collection at Thiruvananthapuram District Co-operative Bank,
Morning and evening branch, Neyyattinkara. The cheques were
dishonoured for the reason ‘funds insufficient’ as is evident from
Ext.P3 and P4 dishonour memos. Ext.P5 is the intimation slip
dated 20.3.2000 received by the complainant from his bank. The
oral testimony of PW1 and Exts.P3 to P5 are sufficient to hold that
Exts.P1 and P2 cheques were dishonoured for the reason ‘funds
insufficient’.
12. According to PW1, he got information regarding the
dishonour of Exts.P1 and P2 cheques on 20.3.2000. The same is
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evident from Ext.P5. Ext.P6 is the demand notice issued to the
accused. Postal receipt in proof of despatch is marked as Ext.P7.
The accused received the notice on 3.4.2000 which is evident from
Ext.P8 postal acknowledgment card. The accused failed to repay
the cheque amount within 15 days from 3.4.2000. The cause of
action in this case arose on 18.4.2000. The complaint is seen filed
on 2.5.2000. It is well within the statutory limit.
13. It has come out in evidence that Ext.P6 notice sent by the
complainant demanding payment of amount was accepted by the
accused. But he did not send any reply. Consequently the accused
miserably failed to avail his first and best opportunity to set forth
his defence and to prevent the complaint from taking legal action, if
the defence is true. In appreciating the evidence on record, I am of
the view that the complainant has succeeded in proving all the
ingredients to arrive at a finding that the accused committed the
offence punishable under Section 138 of N.I. Act and that the
accused failed to rebut the presumption under Sec. 139 of N.I. Act.
Therefore the learned Magistrate is not justified in acquitting the
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accused. Since the accused has committed the offence under
Section 138 of N.I. Act, he is convicted under Section 138 of N.I.
Act.
14. In the decision reported in Damodar S. Prabhu v. Sayed
Babalal H (2010(2) KHC 428 (SC)), it was held that in a case of
dishonour of cheques, compensatory aspect of the remedy should be
given priority over the punitive aspect. Considering the facts and
circumstances of the case, I am of the view that sentencing the
accused to pay a fine of Rs.35,000/- would meet the ends of justice.
15. Accordingly this appeal is allowed. The judgment of
acquittal of the accused in C.C. No. 342 of 2000 on the file of the
Judicial First Class Magistrate Court No.I, Neyyattinkara under
Section 138 of N.I. Act is set aside and the accused is convicted
under Section 138 of N.I. Act and sentenced to pay a fine of
Rs.35,000/-.
16. The said fine shall be paid as compensation to the
complainant under Section 357(1) of Cr.P.C. The accused is
permitted either to deposit the said fine amount before the court
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below or directly pay the compensation to the complainant within
four months from today and produce a memo to that effect before
the trial court in case of direct payment. If the accused fails to
deposit or pay the said amount within the aforesaid period, the
accused shall suffer simple imprisonment for one month by way of
default sentence.
M. L. JOSEPH FRANCIS
( Judge)
dl/