E.P. Madhusudhanan v. Sree Gokulam Chits and Finance Company Limited and State of Kerala

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT:** ## **THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS** **WEDNESDAY, THE 4TH DAY OF OCTOBER 2017/12TH ASWINA, 1939** **Crl.Rev.Pet.No. 808 of 2017 ()** **-------------------------------** ## **CRA 405/2016 OF 1ST ADDITIONAL SESSIONS COURT, KOZHIKODE** **CC 207/2015 OF SPECIAL JUDICIAL FIRST CLASS MAGISTRATE (N.1.ACT CASES), KOZHIKODE** **-----------------** ## **REVISION PETITIONER/APPELLANT/ACCUSED:** **----------------------------------------** **E.P.MADHUSUDHANAN AGED 57, S/O.ANANDHAN, SANTHA VILAS, 4/630, ZILLATHODI, KOZHIKODE.** **BY ADVS.SRI.R.BINDU (SASTHAMANGALAM) SRI.PRASANTH M.P** ## **RESPONDENT(S)/RESPONDENTS/COMPLAINANT & STATE:** **--------------------------------------------------------------------------------------** **1. SREE GOKULAM CHITS AND FINANCE COMPANY LIMITED GOKULAM TOWERS, NO.66, ARCOT ROAD, CHENNAI, REPRESENTED BY IS LEGAL OFFICER, K.K.HARIPRIYA, AGED 41 YEARS, W/O.SASI, ZONAL OFFICE, BISMI TOWER, 1ST FLOOR, KALLAI, CALICUT-673002.** **2. STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM, PIN-682031. R1 BY ADV. SMT. N. SUDHA R2 BY PUBLIC PROSECUTOR SRI. JESTIN MATHEW** **THIS CRIMINAL REVISION PETITION HAVING COME UP FOR ADMISSION ON 04-10-2017, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **sdr/-** ## ALEXANDER THOMAS, J. ----------------------------Crl.R.P.No.808 Of 2017 --------------------------------- Dated this the 4th day of October, 2017. ## O R D E R The petitioner is the accused for the offence under Sec.138 of the Negotiable Instruments Act, in C.C.No.207/2015 on the file of the Special Judicial First Class Magistrate Court (N.I. Act Cases), Kozhikode, instituted on the basis of a complaint filed by R-1 herein. The trial court as per the impugned judgment rendered on 5.9.2016 had convicted the petitioner for the above said offence and he is sentenced to pay fine of Rs.1,24,900/- and in default thereof the accused was sentenced to undergo simple imprisonment for a period of 3 months. The fine amount realised from the accused was ordered to be paid as compensation to the complainant under Sec.357(1)(b) of the Cr.P.C. Aggrieved thereby, the petitioner has preferred Crl.A.No.405/2016 before the Sessions Court, Kozhikode. The appellate Sessions Court concerned (Court of 1[st] Additional Sessions Judge, Kozhikode), as per the impugned judgment dated 14.2.2017 had upheld the conviction and sentence and thereby dismissed the appeal. It is aggrieved by these ::2:: Crl.R.P.No.808 Of 2017 verdicts, that the petitioner has preferred the instant Crl.R.P by taking recourse to the remedy under Sec.397 r/w Sec.401 of the Cr.P.C. 2. Heard Sri.R.Bindu Sasthamangalam, learned counsel appearing for the revision petitioner (accused), Smt.N.Sudha, learned counsel appearing for R-1 complainant-company and Sri.Jestin Mathew, learned Prosecutor appearing for R-2 State. 3. The brief of the allegations in the complaint is to the effect that the accused had entered into a chit transaction with the complainant chit company and that the chit was prized in his favour and after receiving the prized amount, he had defaulted in making payments and in discharge of the said liability the accused had issued Ext.P-4 cheque dated 27.12.2013 for Rs.1,24,900/- drawn from his account and payable in favour of the complainant-chit company. The cheque when presented was resulted in dishonour as per Ext.P-5 bank memo dated 31.12.2013 and thereupon the complainant has issued statutory demand notice calling upon the petitioner-accused to pay off the amount covered by the cheque within a period of 15 days from the date of receipt of the said notice. The said notice send by registered post was duly served on the revision petitioner-accused as per Exts.P-7 & P-8. The petitioner has not responded to the same by sending any reply. ::3:: Crl.R.P.No.808 Of 2017 After complying with the statutory formalities the complainant has instituted the instant complaint, which led to the trial in this case. During the trial, the complainant has tendered oral evidence through Pws-1 & 2 and marked Exts.P-1 to P-9 documents. The defence has not adduced any oral or documentary evidence. The basic defence set up by the accused is to the effect that he had given a blank signed cheque as security at the time of prizing of the chit and that he has not voluntarily issued and executed Ext.P-4 cheque and that the above said blank singed cheque has been misused by the complainant for filing the instant complaint. Going by the defence version it can thus be seen that there is no serious dispute that the signature pertaining to the cheque belongs to the revision petitioner-accused and the cheque was issued from the account maintained by the revision petitioner-accused. Therefore, going by the legal principles well settled by the decisions of the Apex Court as in T.Vasanthakumar v. Vijayakumari reported in (2015) 8 SCC 378 and Rangappa v. Sri Mohan reported in (2010) 11 SCC 441, the complainant is entitled to secure the benefit of statutory presumption under Sec.139 of the N.I. Act in the facts and circumstances of the case. PW-1 has broadly deposed about the chit transaction in question. PW-2 has deposed that he had witnessed the ::4:: Crl.R.P.No.808 Of 2017 handing over of the cheque by the accused to the official concerned of the complainant chit company. Originally the complaint was preferred through the power of attorney holder, one Smt.K.K.Haripriya. As she had left employment of the complainant-company, one Smt.K.V.Savitha, who is an authorised representative of the company, filed proof affidavit dated 30.12.2015 stating that she had witnessed the handing over of the cheque by the accused. Later, she filed additional proof affidavit dated 4.3.2016 stating that apart from her, the above said Smt.Haripriya was also present during the transaction of the handing over of the cheque, etc. It appears that Smt.Savitha also left employment of the company and thereafter the complainant company has examined PW-2, M.K.Viswanathan, who has deposed that he was one of the officials of the company, who had witnessed the handing over of the cheque. Learned counsel for the accused has contended that the complainant had made substantial variances in their versions regarding the witnessing handing over of the cheque and these factual aspects regarding the version that Savitha and Viswanathan having witnessed the handing over of the cheque has not been mentioned in the complaint and evidence of the complainant lacks credibility and execution of the cheque has not been proved by the complainant, etc. ::5:: Crl.R.P.No.808 Of 2017 When the complaint was filed through the original power of attorney holder Haripriya, it may not have been contemplated by the complainant at that time that the said person would leave the employment of the company and therefore the omission to state in the complaint that PW-2 had also witnessed the handing over of the cheque is not fatal to the case of the complainant. It is not in dispute that PW-2 is an employee of the company and he was working in the office concerned where the transaction had taken place and not much adverse circumstance has been brought out in evidence in any manner to suspect or disbelieve the version of PW-2 and therefore the said contention of the petitioner is only to be overruled. During the examination of the accused at the stage of Sec.313 Cr.P.C. questioning process, he has stated that towards the chit, having sala of Rs.25 lakhs, he had paid Rs.24,01,250/- and that Rs.98,700/- is the amount to be paid by the complainant-company as dividend to him. Both the courts below have found that Ext.P-9 ledger account and Ext.P-9(a) statement of accounts have remained unchallenged during cross-examination of PW-1. No suggestion was put to PW-1 to the effect that any payment made by the accused is not shown in the above statement of accounts or there is any mistake in the instalment amount or dividend or interest ::6:: Crl.R.P.No.808 Of 2017 calculated in Ext.P-9 document. It is not in dispute that the chit was commenced on 28.11.2011 and was terminated on 28.6.2013. As per Ext.P-9 series, the total amount paid by the accused is Rs.17,44,000/and the dividend granted to the accused is Rs.2,01,250/- at the time of termination of the chitty on 28.6.2013. Thereafter, the accused has paid a total amount of Rs.4,60,000/- to the complainant company and so the total amount paid by the accused is Rs.22,00,000/- and the amount including dividend is Rs.24,01,250/- and hence the balance amount payable by the accused is Rs.98,750/-. It is not in dispute that the total amount of Rs.1,24,900/- covered by Ext.P-4 cheque dated 27.12.2013 is above the said balance amount of Rs.98,750/- along with interest thereon at the agreed rate of 18% p.a. coming to Rs.26,230/-. The trial court has also found that the above said balance amount of Rs.98,750/- is also discernible from Ext.D-1 on which the accused had placed reliance. It would be relevant to quote the above said findings of the appellate court in para 12 of the impugned judgment which reads as follows: “12. According to the 1st respondent the appellant is liable to pay Rs.25,00,000/- towards subscription. As he has paid only a sum of Rs.24,01,250/-, a sum of Rs.98,750/- towards the principal and a sum of Rs.26,230/- towards interest due and Ext.P-4 cheque was issued in discharge of the said amount. A perusal of Ext.P-3 agreement would go to show that the appellant is liable to pay interest towards delayed payment of instalments. The appellant has no case that he is not liable to pay ::7:: Crl.R.P.No.808 Of 2017 the interest on arrears. The 1st respondent has also produced Ext.P9 true extract of the account. Ext.P9 has been properly certified as required under section 65(B) of the Indian Evidence Act. So Ext.P9 is admissible in evidence. In my view the oral evidence of PW1 and 2 coupled with Ext.P9 and Ext.D1 document would substantiate the contention of the 1st respondent that Ext.P4 cheque was issued in discharge of the amount legally due.” 4. Learned counsel for the respondent-complainant has pointed out that the subscriber is entitled to get the dividend on prompt payment of instalment amount and if there is default in payment of the instalment amount he is dis-entitled to get dividend in terms of Ext.P-3 agreement. As per the condition in Ext.P-3 agreement, the accused has agreed that the complainant has forfeited the dividend amount in the chitty instalments in case of default in monthly subscription in time and the accused was liable to pay monthly instalment of Rs.1,25,000/- in the above said chitty and Ext.P-9 clearly shows that the chit amount was paid by the complainant to the accused on 29.3.2012 and thereafter he made default in payment of the instalment amount promptly. It is seen that dividend was given to the accused in all months till March, 2012. The accused was liable to pay Rs.6,25,000/as on 28.3.2012 towards 5 instalments and the amount paid by the accused as on 28.3.2012 was Rs.5,69,000/- only. Hence dividend was not given to the accused on the next two months and he paid Rs.6,25,000/- only in the month of May, 2012. Granting of dividend is ::8:: Crl.R.P.No.808 Of 2017 specifically shown in Ext.D-1 passbook. It shows that the dividend was granted as shown in Ext.P-9 and the accused as no case that he had raised any objection regarding denial of dividend as per the entires in Ext.D-1. Hence, both the courts below found that there is no merit in the contention of the accused regarding non-payment of dividend amount, etc. It is in the light of all these aspects, both the courts below have come to the conclusion that the due amount payable by the petitioner to the complainant company as on 27.12.2013 (date of issuance of Ext.P-4 dishonoured cheque) is Rs.1,24,900/-, which is the amount reflected in the above said cheque. In the light of these aspects, both the courts below have come to the concurrent conclusion that the complainant could prove his case and therefore the accused is liable to be convicted for the offence under Sec.138. Thus the findings cannot be said to be perverse or unreasonable and therefore this Court is of the view that this Court will not be justified to interfere in a matter like this by taking resort to the revisional powers conferred on this Court. As regards the sentence, it is seen that the trial court has liberally avoided imposing any substantive sentence on the petitioner and only imposed fine amount of Rs.1,24,900/- (which is the cheque amount) with default clause of simple imprisonment for 3 months. These aspects have ::9:: Crl.R.P.No.808 Of 2017 also been confirmed by the appellate court. The said fine amount cannot be termed as excessive or disproportionate. Hence this Court is not in a position to interfere with the said aspect also. Sri.R.Bindu Sasthamangalam, learned counsel appearing for the revision petitioneraccused submits that in case this Court is so inclined to confirm the conviction and sentence, then this Court may grant 8 months' time to the petitioner to pay the above said fine amount. Having regard to the facts and circumstances of the case, this Court is inclined to grant time only by 5 months. Accordingly, the following orders and directions are passed: (i) The impugned conviction, sentence of fine imposed on the petitioner for the offence under Sec.138 of the N.I Act are confirmed. (ii) The petitioner is given 5 months' time from 15.10.2017 to remit the above said fine amount of Rs.1,24,900/- before the trial court. The petitioner would endeavour to pay the above said amount of Rs.1,24,900/- in various instalments within the next 5 months. On remitting such instalments, the trial court will take steps to disburse the said amount to the complainant after issuing notice in that regard. (iii) The petitioner shall personally appear before the trial court on any day on or before 17.3.2018 to satisfy the said court about payment of Rs.1,24,900/-. On default of the petitioner to pay the said amount, he will have to suffer simple imprisonment for 3 months. ::10:: Crl.R.P.No.808 Of 2017 (iv) Until 17.3.2018, all further coercive proceedings taken against the petitioner in pursuance of execution of the sentence will stand deferred. (v) On default of the petitioner either to appear before the court below on 17.3.2018 or to make payment as above said, then the trial court will be at liberty to proceed against the petitioner in accordance with law. Registry will forward a copy of this judgment to the court below for further necessary action. With these observations and directions, the Crl.R.P stands finally disposed of. Sd/- ALEXANDER THOMAS, Judge. Bkn/- // true copy // P.A to Judge.