High Court of KeralaSingle Judge2015-10-05Revision petition disposed of; conviction under...

K. Rekha v. Suresh K.V. and The State of Kerala

Case / Petition Number:Crl.Rev.Pet.No.1551 of 2008

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: P. D. Rajan
Judgment Date: 2015-10-05
Court Decision / Holding: The revision petition is disposed of in the above terms: The revision petitioner is sentenced to imprisonment till rising of the Court under Section 138 NI Act and to pay compensation of ₹40,000 under Section 357(3) Cr.P.C., in default, simple imprisonment for two months. If the compensation amount is realised, it shall be disbursed to the 1st respondent forthwith. The revision petitioner is directed to surrender forthwith in the Judicial Magistrate of I Class - II, Thrissur to undergo the modified sentence.
Final Disposition: Revision petition disposed of; conviction under Section 138 NI Act upheld; sentence modified to imprisonment till rising of the Court with payment of ₹40,000 compensation; default imprisonment for two months; petitioner to surrender.

Parties to the Case

Appellants / Petitioners

K. Rekha, W/o Narayanankutty, Kundil House, Veluthur PO, Thrissur

Respondents

Suresh K.V., S/o. Velayudhan, Kariyathvalappil House, Parakkad Desom Arimbur Po, Thrissur
The State of Kerala, rep. by the Public Prosecutor, High Court of Kerala, Ernakulam

Legal Representation & Advocates

Counsels for Petitioners

• Sri. C.A. Chacko
• Smt. C.M. Charisma
• Sri. N.A. Shafeek

Counsels for Respondents

• Sri. Vinod J. Dev
• Sri. Pramod J. Dev
• Public Prosecutor Sri. N. Suresh

Case Synopsis & Summary

This Kerala High Court revision challenges a conviction under Section 138 of the Negotiable Instruments Act and the appellate modification of sentence. Rekha, accused in ST 4715/2003, was found guilty of issuing Ext. P1 (₹40,000) which was dishonoured for funds insufficiency. The complainant argued that the cheque was issued in discharge of a debt; the accused contended Ext. P1 was given as security for a loan to a relative. The trial court convicted; on appeal the conviction was sustained and the sentence modified to a fine/compensation and a default imprisonment. In revision, counsel argued that Ext. P1 was issued as security, not in discharge of a debt; the complainant maintained it was issued to discharge a debt. The trial court’s evidence included PW1 and Exts P1–P6, including dishonour memos. The court applied the presumption in favour of the holder under Section 139 NI Act and relied on Beena v. Muniappan to explain presumptions under the NI Act. It concluded Ext. P1 was issued in discharge of a debt; hence the presumption applied. The court then modified the sentence: imprisonment till rising of the Court and ₹40,000 compensation under Cr.P.C. 357(3), with default two months’ imprisonment; Rekha was directed to surrender to the JMFC forthwith.

Provisions of Law Cited

Section 138 of the Negotiable Instruments ActSection 139 of the Negotiable Instruments ActSection 357(3) Cr.P.C.

Legal Doctrines & Maxims

Presumption in favour of the holder under Section 139 NI Act
Burden shifts to the accused to rebut the presumption once a legally enforceable debt is established
Beena v. Muniappan (AIR 2001 SC 2995) – presumption under Section 139 NI Act

Submissions & Arguments

Contentions of Appellants / Petitioners

The applicants argued that Ext. P1 was issued as security for a loan to a relative, and not in discharge of a debt; the cheque’s status as security defeats the claim that it was evidence of a debt. They contended that Section 138 requires evidence of debt or liability and that the presumption under Section 139 NI Act shifts the burden to the drawer only when a legally enforceable debt exists; they urged the High Court to re-evaluate the lower courts’ reasoning which concluded Ext. P1 evidenced a debt.

Contentions of Respondents

The respondents contended Ext. P1 was issued to discharge a debt; the cheque’s dishonour triggered Section 138; the notice and Section 139 presumption operated in the holder’s favour, placing the burden on the drawer to rebut. They argued that the trial and appellate courts correctly found Ext. P1 to be in discharge of debt, supported by Exts. P1–P6 (notice, dishonour memos, etc.), and that the revision petition should fail.

Cited Precedents (1)

Case Name	Citation	Treatment	Explanation
Beena v. Muniappan	AIR 2001 SC 2995	Positive	Cited to support the presumption framework under Section 139 NI Act and the burden of proof on the drawer.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** **THE HONOURABLE MR. JUSTICE P.D.RAJAN** **MONDAY, THE 5TH DAY OF OCTOBER 2015/13TH ASWINA, 1937** **Crl.Rev.Pet.No. 1551 of 2008 ( ) --------------------------------AGAINST THE JUDGMENT IN Crl. Appeal NO.841/2005 of ADDL. SESSIONS JUDGE, THRISSUR DATED 01-04-2008 AGAINST THE JUDGMENT IN ST 4715/2003 of J.M.F.C.-II,THRISSUR DATED 06-10-2005** **REVISION PETITIONER(S)/APPELLANT/ACCUSED:** **------------------------------------------K.REKHA, W/O.NARAYANANKUTTY, KUNDIL HOUSE, VELUTHUR PO, THRISSUR. BY ADVS.SRI.C.A.CHACKO SMT.C.M.CHARISMA SRI.N.A.SHAFEEK** **RESPONDENT(S)/RESPONDENTS/COMPLAINANT & STATE:** **------------------------------------------------** **1. SURESH K.V., S/O. VELAYUDHAN, KARIYATHVALAPPIL HOUSE, PARAKKADU VILLAGE DESOM ARIMBUR PO, THRISSUR.** **2. THE STATE OF KERALA, REP.BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA ERNAKULAM.** **R1 BY ADV. SRI.VINOD J.DEV R1 BY ADV. SRI.PRAMOD J.DEV** **R2 BY PUBLIC PROSECUTOR SRI. N. SURESH** **THIS CRIMINAL REVISION PETITION HAVING BEEN FINALLY HEARD ON 05-10-2015, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **acd** ## **P.D. RAJAN, J.** ------------------------------------------Crl. R.P.No.1551 of 2008 ---------------------------------------------Dated this the 5[th] day of October, 2015 ## **ORDER** Revision petitioner , who is the appellant in Crl.Appeal No.841/2005 on the file of Additional Sessions Judge, (Fast Track Court No.II-Adhoc), Thrissur, challenges the concurrent finding of conviction u/s.138 of the Negotiable Instruments Act (hereinafter referred to as the N.I. Act). She was the accused in S.T.No.4715/2003 of Judicial Magistrate of First Class -II, Thrissur, she was convicted and sentenced to simple imprisonment for one day till the rising of the Court u/s.138 of N.I. Act and directed to pay ₹40,000/- to the complainant as compensation u/s.357(3) Cr.P.C. Crl.R.P. No.1551/2008 2 2. The complainant's case in the trial Court was that in discharge of a debt, the accused issued a cheque for 40,000/-. When the cheque was presented for₹ encashment, it was dishonoured for the reason of funds insufficient. He demanded the due amount by giving a notice in writing. Even after specific demand, there was no repayment by the revision petitioner. Hence, the above complaint. 3. During trial, the complainant was examined as PW1. His documentary evidence were marked as Exts.P1 to P6. The incriminating circumstances brought out in evidence were denied by the accused while questioning him. He did not adduce any defence evidence. The trial Court convicted the accused. Against that, he preferred the above appeal, in which the conviction was confirmed and the sentence was modified to payment of fine of Crl.R.P. No.1551/2008 3 ₹40,000/-, in default, simple imprisonment for two months. Being aggrieved by that, he preferred this revision petition. 4. The learned counsel for the revision petitioner submits that Ext.P1 cheque was issued as a security, while availing a loan from the 1[st] respondent by a relative of the revision petitioner. But, the 1[st] respondent contended that the cheque was issued in discharge of a debt. 5. According to Section 138 of the N.I. Act, where any cheque drawn by a person on an account maintained by him with a bank for payment of any amount of money to another person from out of that account, for the discharge in whole or in part of any debt or liability, is returned by the bank, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the 4 Crl.R.P. No.1551/2008 amount arranged to be paid from that account by an agreement made with a bank, such person shall be deemed to have committed an offence under Section 138 of the Negotiable Instruments Act. This deemed provision is subject to the statutory condition that the cheque has to be presented within the statutory period in which it is drawn or within the period of its validity. Secondly, the payee or holder in due course of the cheque makes a demand for payment of such amount by giving a notice in writing to the drawer of the cheque and non-payment of due amount after receipt of notice by the drawer of the cheque. 6. PW1 deposed that Ext.P1 was issued in discharge of a debt. When Ext.P1 was presented for encashment, it was dishonoured for the reason of funds insufficient. Exts.P2 and P3 are the dishonour memos. He sent a lawyer Crl.R.P. No.1551/2008 5 notice. Ext.P4 is the copy of the notice. Ext.P5 is the postal receipt and Ext.P6 is the acknowledgment card. Analysing the evidence of PW1 and Exts.P1 to P6, it is clear that the cheque was dishonoured for the reason of funds insufficient. When the cheque is dishonoured for the reasons stated u/s.138 of the N.I. Act, a presumption can be drawn in favour of the holder of the cheque u/s.139 of the N.I. Act. 7. When complainant proves the existence of a legally enforceable debt, the presumption under Section 139 of the Negotiable Instruments Act starts operating and burden shifts to the accused. Section 139 reads as follows. “139. Presumption in favour of the holder - It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability”. Crl.R.P. No.1551/2008 6 PW1 deposed that the revision petitioner admitted his signature in Ext.P1. Thus, the burden was on the revision petitioner to rebut the presumption of the existence of any legally recoverable debt or liability. For rebutting the presumption, no evidence has been adduced by the revision petitioner. The principle drawing presumptions has been explained by the Apex Court in **Beena** v. **Muniappan** (AIR 2001 SC 2995). The trial Court and the appellate Court appreciated the legal position and concluded that Ext.P1 was issued in discharge of a debt. I do not find any illegality in the above judgment. 8. While confirming the conviction u/s.138 of the N.I. Act, the appellate Court modified the sentence to payment of fine of 40,000/-, in default of payment of₹ fine, simple imprisonment for two months. Considering the nature of offence, I modify the sentence passed by Crl.R.P. No.1551/2008 7 the appellate Court as follows: The revision petitioner is sentenced to imprisonment till rising of the Court u/s.138 of the N.I. Act and to pay compensation of 40,000/- u/s.357(3) Cr.P.C. , in default₹ of payment of compensation, simple imprisonment for two months. If the compensation amount is realised, it shall be disbursed to the 1[st] respondent forthwith. The revision petitioner is directed to surrender forthwith in the Judicial Magistrate of I Class - II, Thrissur to undergo the modified sentence. This revision petition is disposed of as above. ## **P.D. RAJAN, JUDGE.** acd Crl.R.P. No.1551/2008 8 Crl.R.P. No.1551/2008 9