Gigikumar v. Sushamma Ullas and The State of Kerala

``` IN THE HIGH COURT OF KERALA AT ERNAKULAM ``` ``` PRESENT ``` ``` THE HONOURABLE MRS. JUSTICE MARY JOSEPH ``` ``` THURSDAY, THE 14[TH] DAY OF DECEMBER 2023 / 23RD AGRAHAYANA, 1945 ``` ``` CRL.A NO. 523 OF 2021 ``` ``` AGAINST THE JUDGMENT DATED 22.01.2021 IN ST NO.149/2017 OF THE JUDICIAL FIRST CLASS MAGISTRATE COURT-V, KOLLAM ``` ## `APPELLANT/COMPLAINANT:` ``` GIGIKUMAR, AGED 51 YEARS, GOKULAM, UMAYANALOOR, KOLLAM DISTRICT. BY ADVS.SRI.V.PREMCHAND SMT.SURYAMOHAN P. ``` ## `RESPONDENTS/ACCUSED:` ``` 1SUSHAMMA ULLAS, ATTOOR VEEDU, PERINADU P.O., KADAVOOR, KOLLAM DISTRICT, PIN-691602 2THE STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM-682031. BY ADVS.SRI.C.RAJENDRAN SRI.M.RAJESH BY GOVERNMENT PLEADER SMT.NIMA JACOB ``` ``` THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 14.06.2023 THE COURT ON 14.12.2023 DELIVERED THE FOLLOWING: ``` Crl.Appeal No.523 of 2021 -:2:- ## **MARY JOSEPH, J.** - - - - - - - - - - - - - - - - - - - - - - - - Crl.Appeal No.523 of 2021 - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 14[th] day of December, 2023 ## **JUDGMENT** This appeal is originated from the judgment dated 22.01.2021 of Judicial First Class Magistrate Court-V, Kollam (for short ‘the court below’) in ST No.149/2017. The appellant is the complainant in ST No.149/2017, a prosecution initiated under Section 138 of the Negotiable Instruments Act, 1881 (for short ‘the NI Act’) based on a complaint filed under Section 142 NI Act. 2. The allegation in the complaint was that to discharge a monetary liability due from him, the accused issued cheque bearing No.419202 dated 20.06.2012 for a sum of `10,00,000/- drawn on State Bank of India, Kadavoor Branch. The said cheque was presented before the Bank for encashment but was dishonoured for the reason “funds insufficient”. Though notice was caused to be issued by the Crl.Appeal No.523 of 2021 -:3:- appellant on the accused, she did not turn up to clear off the monetary liability. She did not even send a reply notice. In that scenario, a complaint was filed by the complainant under Section 142 NI Act and the prosecution in question was launched for the offence under Section 138 NI Act. The accused when appeared before the court in response to the process issued therefrom, the accusations made in the complaint against her were read over and explained. She pleaded not guilty and claimed to face trial. 3. Accordingly trial was commenced. Complainant examined PWs 1 to 3 and marked Exts.X1 series and X2 series. On closure of the evidence of the complainant, the accused was questioned under Section 313(1)(b) of the Code of Criminal Procedure, 1973 (for short ‘the Cr.P.C.’) with reference to the incriminating circumstances brought out in evidence by the complainant. She denied all questions put to her and filed a written statement in addition. The contents of the written statement are to the following effect: She was a housewife and her husband was working as a Welder and from the income earned therefrom, their Crl.Appeal No.523 of 2021 -:4:- livelihood was met. The complainant and his wife PW3 met her during trial before the court below. Herself or her husband had not availed any amount from the complainant. At the behest of the sister of her husband Mrs.Girija Surendran, a cheque of herself as name lender was obtained and was misused by the complainant to launch the prosecution. The house situated in the address shown in the cause title of the complaint was sold by her husband in January, 2009 and thereafter she had stayed in a house named ‘Nandanam’ and further in various houses on rent. Since the complainant do not know the correct address of the accused that Ext.P3 notice was issued in her earlier address. She has no transactions with the complainant and his family members were total strangers to her. She has evidence to let. Ext.P1 cheque was never executed by her in favour of the complainant. 4. After closure of the examination of the accused under Section 313 (1)(b) Cr.P.C. she was asked to enter on her defence. She failed to adduce any evidence. Thereupon the counsel representing the parties were heard and the court Crl.Appeal No.523 of 2021 -:5:- below arrived at a finding that the complainant failed to prove execution of Ext.P1 cheque by the accused and thus, commission of an offence punishable under Section 138 NI Act by the accused. Accordingly, the accused was acquitted under Section 255 (1) Cr.P.C. Aggrieved by the judgment above, the appeal on hand is filed. 5. Sri.V.Premchand argued on behalf of the appellant. Though served with notice, none turned up to argue the matter on behalf of the respondent. 6. For the sake of convenience, the parties to this Appeal will hereinafter be referred to as the complainant and the accused in accordance with their status before the court below in the prosecution on hand. 7. According to Sri.V.Premchand, in the judgment under challenge the trial court has based four reasons to acquit the accused. The first reason according to him was the failure of the complainant to prove execution of Ext.P1 cheque. The second reason was the failure of PW1 to prove any prior understanding with the accused regarding lending of money. The third reason according to him was that the Crl.Appeal No.523 of 2021 -:6:- evidence tendered by PW3 in the view of the court below was doubtful. The fourth reason was that the entire particulars of the transaction were omitted to be stated in the complaint filed to launch the prosecution. According to the learned counsel, the court below went wrong in acquitting the accused based on those reasons. According to him, the position of law with reference to a prosecution under Section 138 N.I. Act is settled by the Apex Court in **Bir Singh v. Mukesh Kumar** [2019 (1) KHC 774 (SC)] by holding that a signed blank cheque when established by the complainant as voluntarily issued to him by the accused, the presumption under Section 139 NI Act would be attracted in his/her favour. According to him the complainant has only to discharge his/her initial burden that the disputed cheque in a signed form was voluntarily issued by the accused to him. According to the learned counsel, when the initial burden stood discharged by the complainant, the reverse onus would lie on the accused to rebut the presumption. The learned counsel contended that the accused in the case on hand failed to discharge the reverse onus cast upon her by law to rebut Crl.Appeal No.523 of 2021 -:7:- the presumption available in favour of the complainant that the disputed cheque in question was issued by the accused to the complainant to discharge a debt or liability owed by her to the latter. According to him the court below ought to have found in the context that the complainant has successfully established his case and the accused as guilty and convicted and sentenced for the offence under section 138 N.I Act. According to him, the judgment under challenge finding the accused not guilty and acquitting her is liable to be reversed in the said circumstances. 8. In the backdrop of the rival contentions raised, it is incumbent upon this Court to have an understanding about the pleadings of the complainant in the complaint filed to launch the prosecution in question. The pleadings of the complainant are narrated in paragraph 1 of the complaint, which is extracted hereunder for convenient reference: “Accused in discharge of her indebtedness to the complainant had drawn Cheque No.419202 dt.20/6/2012 for Rs.10,00,000/- (Rupees Ten Lakhs Only) in favour of the complainant on an account maintained by her with State Bank of India, Crl.Appeal No.523 of 2021 -:8:- Kadavoor Branch. Copy of the said cheque is submitted herewith. Complainant presented the said cheque for collection through The South Indian Bank, Kottiyam, but the same was dishonoured and returned unpaid to the complainant with a memo dt.10/9/2012 stating ‘funds insufficient’ as the reason for such dishonour. The memo issued by bank is produced herewith.” 9. It is deduced from the pleadings above that, to discharge a debt of `10,00,000/- owed by the accused to the complainant, a cheque bearing No.419202 dated 20.06.2012 for `10,00,000/- was drawn and issued in favour of the complainant. The cheque was drawn from an account maintained by the accused with State Bank of India, Kadavoor Branch. The said cheque was presented by the complainant for collection through South Indian Bank, Kottiyam. Cheque was bounced and returned to the complainant with a memo issued by the bank on 10.09.2012 indicating the reason “funds insufficient”. The complainant had filed proof affidavit in lieu of examination in chief and was cross examined as PW1. Crl.Appeal No.523 of 2021 -:9:- 10. In the proof affidavit, he has stated that the accused had borrowed `10,00,000/- from him on 15.09.2011 and to discharge the said monetary liability, a cheque bearing No.419202 drawn from State Bank of India, Kadavoor Branch dated 20.06.2012 was issued to the complainant. The said cheque was marked in evidence as Ext.P1. The cheque was presented by the complainant for collection through South Indian Bank, Kottiyam Branch where an account was maintained by him, but, was bounced and returned on 10.09.2012 accompanied by a memo showing the reason as “funds insufficient”. The memo was marked in evidence as Ext.P2. 11. As already stated, the complainant was cross examined as PW1. Admittedly he was engaged in business relating to real estate and vehicles. He was also an Income Tax payee and has undertaken to produce the Income Tax Returns filed for the financial years 2011-12 and 2012-13. According to him the accused was a friend of his wife and their friendship started since 2008. According to him the accused is unemployed but her husband is doing contract Crl.Appeal No.523 of 2021 -:10:- work. He has also gone to the extent of stating that his information about the job of the husband of the accused is only hearsay. PW1 was also cross examined with reference to his financial capacity to advance the amount. A specific question was put to him, whether he has any authentic materials to establish the availability of `10,00,000/- with him on 15.09.2011 and could produce it before the court and PW1 had undertaken to produce those. He was cross examined further with reference to his failure to state 15.09.2011 as the date on which `10,00,000/- was advanced by him to the accused. It is found that the date on which the amount was advanced was stated by the complainant firstly in the proof affidavit filed in lieu of examination in chief. According to PW1 the entries in Ext.P1 cheque were typewritten when it was brought to him and the signature was affixed on it in his presence. Admittedly, prior to the transaction of borrowal of money on 15.09.2011, there were no occasion for demands of money by the accused and offers from the complainant to advance it. An attempt was also made during cross examination to establish that the address of the accused in Crl.Appeal No.523 of 2021 -:11:- which Ext.P3 statutory notice was sent was different from the one furnished in the cause title of the complaint. Admittedly the complainant has acquaintance with the sister-in-law of the accused Smt.Girija Surendran, but denied to have any transaction with her. But admittedly there were transactions of exchange of money among themselves for business purpose. A suggestion was put to him that the complainant stood as a money lender to Girija Surendran and the complaint was falsely launched against her, but was denied by PW1. It has come out in evidence during cross examination that a Civil Suit was not filed by the complainant for realisation of money covered by Ext.P1 cheque. 12. PW2 examined by the complainant was none other than the General Manager in- charge of Co-operative Urban Bank, Kollam. The documents directed by the court in the summons issued to her were produced by her. According to her the original of the loan account No.582/11/E was not produced by her, but only the statement having the endorsement of the said loan prepared after examination of the loan account was produced. The loan receipts were also Crl.Appeal No.523 of 2021 -:12:- produced by her and marked in evidence as Ext.X1 series and the Statement of Accounts pertaining to the receipts is also produced and marked in evidence as Ext.X2 series. During cross examination, it was brought out from PW2 that those who submitted application for gold loan were given money on 07.09.2011 itself. It was also admitted by her that the money due to the loan account described in Ext.X1 series was closed on 31.12.2011. 13. PW1 had also examined his wife as PW3. In the proof affidavit filed _in lieu_ of chief examination, she has stated that the accused was her friend and on her demand and compulsion, the complainant had advanced `10,00,000/to her on 15.09.2011. According to her, two weeks prior to the date of advancing the amount itself, the accused has requested PW3 as well as her husband to lend `10,00,000/-. According to her, her husband was doing business in real estate and travel agency and therefore thought of lending the money after making the cash ready. The money could not be arranged by her husband and therefore it was decided to advance it after pledging the gold ornaments that belong Crl.Appeal No.523 of 2021 -:13:- to herself and children. Thus the gold ornaments were pledged on 07.09.2011. Since her husband had to proceed to Bangalore urgently, money was advanced to the accused only on 15.09.2011. The accused being her friend, her husband trusted her and advanced the money. The money was advanced for the purpose of carrying on the contract business of the husband of the accused. According to her, money was borrowed from the complainant under the guise that the husband of the accused who had undertaken a contract work would obtain the money for the construction work in June 2012. While issuing Ext.P1 cheque dated 20.06.2012, the accused made the complainant to believe that it would be encashed on presentation. During cross examination, she has gone to the extent of stating that she was working in a NonBanking Finance Company. It was put to her during cross examination that cash above `20,000/- could only be transferred through account but, she answered that such a law was not existing at the relevant time of the alleged transaction. When questioned about their acquaintance with each other, it was stated by her that the accused used to visit Crl.Appeal No.523 of 2021 -:14:- Madathil Finance, Mayyanad Branch where she was an employee during the period 2010-13. The rest of the cross examination was confined to the job and address of the accused. Admittedly, a civil suit for realisation of money was not filed on the basis of Ext.P1 cheque. According to her Ext.P1 cheque was also brought to her with its entries typewritten but, signed in her presence and issued to the complainant. The specific defence taken by the accused in the case was that a cheque issued by Mrs.Girija Surendran, her sister-in-law was misused by the complainant showing herself as the name lender and the prosecution in question was launched. A suggestion with reference to that was also put to PW1 but he denied it. In the additional written statement filed also, a specific stand to that effect was taken. But it is pertinent to note that how Ext.P1 reached the hands of the complainant, is nowhere stated by the accused. 14. Ext.P1 cheque was not disowned by the accused. The manner in which it reached the hands of the complainant for the alleged misuse and launching of prosecution are also not stated by her. The specific case of the complainant was Crl.Appeal No.523 of 2021 -:15:- that the cheque was given to him when `10,00,000/- was advanced by him to the accused. It was held by the Apex Court in **Bir Singh** supra that : “Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under Section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt” 15. Therefore, the position of law is settled that when a blank cheque leaf, signed was handed over voluntarily by the accused to the complainant, the presumption under Section 139 NI Act would be attracted, till the accused proved to the contrary that the cheque was not issued in discharge of a legal debt or liability alleged by the complainant. 16. As already stated the accused had taken a specific stand that her cheque was misused by the complainant and the prosecution in question was launched. According to her she stood as a namelender for Mrs.Girija Surendran who had borrowed some money from the complainant. But she failed to adduce any evidence to establish that aspect. From the Crl.Appeal No.523 of 2021 -:16:- memo of dishonour of the cheque issued from the Bank marked in evidence as Ext.P2, it is established that Ext.P1 cheque when presented for collection was dishonoured for the reason of insufficiency of funds in the account of the accused. The signature in Ext.P1 was not disowned. The accused though had taken a stand of misuse of the cheque by the complainant, failed to establish it by cogent evidence. 17. The accused did not disown Ext.P1 cheque. His case was that it was obtained by the complainant from Girija Surendran and misused by herself as the money lender. There is total want of any evidence other than the deposition of PW1 to establish the misuse of Ext.P1 cheque. Therefore, this Court is inclined to take a view that the initial burden cast on the complainant in a prosecution under Section 138 N.I. Act is satisfactorily discharged by the complainant and the presumption under Section 139 N.I. Act attracted in the case was not rebutted by the accused. 18. During cross examination, a question regarding the source of money to lend `10,00,000/- was put to PW1. The specific answer given by PW1 was that he had pledged Crl.Appeal No.523 of 2021 -:17:- gold ornaments belonging to his wife and children to avail `10,00,000/- from Co-operative Urban Bank, Kollam and advanced that to the accused. Though in the complaint, the date on which the money was advanced was not stated, the complainant had sworn to that aspect in the proof affidavit filed by him. The complainant had no case whether any demand was made by the accused prior to receipt of `10,00,000/- or any promise was given by the accused to repay it. The complainant has not taken pleadings in that regard in the complaint. He did not even take the burden to explain the above particulars in the proof affidavit filed. What was the rate of interest agreed to be paid for `10,00,000/advanced to her was also not stated anywhere by PW1. 19. Going by the specific stand taken by PW1 during cross examination that the gold ornaments belonging to his wife and children were pledged to avail `10,00,000/-, it is pertinent to note that Exts.X1 and X2 series summoned from the bank revealed that the amount availed by way of gold loan was more than `10,00,000/-. It was also found availed on a date prior to the date of advancing the amount in favour Crl.Appeal No.523 of 2021 -:18:- of the accused. The circumstances prompted the complainant to pledge the gold ornaments on 07.09.2011 are not known. Exts.X1 series and X2 series would go contrary to the stand taken by PW1 that the gold loan was availed only to advance the money to the accused. It is pertinent to note that advancing of loan on pledging gold ornaments in the ordinary circumstance cannot be without charging interest. It has come out in evidence that the gold loan was closed on 31.12.2011. There is no case for the complainant that interest was also undertaken to be paid by the accused. The amount covered by the cheque is also `10,00,000/-, the sum allegedly advanced as loan. A prudent man would not advance money by pledging gold ornaments of himself/herself and his children by suffering the interest on his/her own and without getting an assurance from the debtor about the date on which it would be repaid. Moreover, the date of issuance of Ext.P1 was not spoken by PW1. PW1 has also no consistent stand on issuance of Ext.P1 as security either at the time of lending the money itself or issued later to discharge of monetary liability, when repayment was Crl.Appeal No.523 of 2021 -:19:- demanded. However, the amount for which Ext.P1 stood issued is `10,00,000/-. Therefore, it is clear that the said amount is not inclusive of interest. 20. It is highly unbelievable to accept the version of PW1 that the gold ornaments were pledged and `10,00,000/was advanced. According to PW1 and PW3, on the basis of the friendship of PW3 and the accused, the amount was advanced. The wife of PW1 was examined as PW3. It is pertinent to note that PW3 has spoken about so many aspects of the transactions, which the complainant as PW1 failed to speak during his examination. When PW3 was cross examined about her acquaintance with the accused, she has spoken that it was originated on account of the frequent visits of the accused at the institution wherein she was working during 2010-13. The stand of the complainant that a huge sum of `10,00,000/- was lent by him to the accused out of friendship of his wife with the accused itself defeats the prosecution case. The money as per the proof affidavit filed by the complainant was advanced on 15.09.2011. Since these improbabilities have been brought out by the accused during Crl.Appeal No.523 of 2021 -:20:- cross examination of PW1, this Court is inclined to hold that the accused has succeeded in bringing forth preponderance of probabilities in the evidence of the complainant and thus it can be safely concluded that the presumption under Section 139 NI Act which stands attracted in favour of the complainant was rebutted by her successfully. Or in otherwords, the accused has satisfactorily discharged the reverse onus. 21. The court below ought to have arrived at such a finding, but it found that the complainant failed to establish execution of Ext.P1 cheque. The court below was wrong only to the extent of finding that the complainant failed to prove the execution of Ext.P1 cheque, but it ordered for acquittal of the accused correctly. The court below ought to have found that Ext.P1 cheque in a signed form was obtained by the complainant voluntarily from the accused towards discharge of a legal debt and therefore the prosecution under Section 139 NI Act is attracted. The onus is upon the accused to establish that the case of the complainant is an improbable one or else that Ext.P1 was issued in a transaction with Crl.Appeal No.523 of 2021 -:21:- someone other than the one pleaded by the complainant and the same has been misused by the complainant after falsely obtaining it from her. The accused has satisfactorily established that the version of the complainant regarding the monetary transaction which caused the issuance of Ext.P1 is having sufficient basis. Therefore, the court below is justified in arriving at a finding that the accused is not guilty of the offence under Section 138 NI Act and acquitting her. Appeal fail for the reasons and is dismissed. Sd/- **MARY JOSEPH JUDGE** MJL