Krishnapanicker Sasidharan v. M/S Hongkong and Shanghai Banking Corporation Ltd. and The State of Kerala

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT :** **THE HONOURABLE MR. JUSTICE S.S.SATHEESACHANDRAN** **TUESDAY, THE 23RD AUGUST 2011 / 1ST BHADRA 1933** **Crl.Rev.Pet.No. 1832 of 2011()** **------------------------------------** **CRA.683/2008 of II ADDL. SESSIONS COURT - II, TRIVANDRUM ST.580/2006 of JUDICIAL FIRST CLASS MAGISTRATE COURT - VI, THIRUVANANTHAPURAM** **....................** **REVN. PETITIONER(S): APPELLANT/ACCUSED** **------------------------------------------------------** **KRISHNAPANICKER SASIDHARAN, S/O. KRISHNA PANICKER, CONTRACTOR, LEKSHMI KRISHNA, T.C.25/33-1.** **BY ADVS. SRI.B.KRISHNA MANI SRI.D.KESAVAN NAIR** ## **RESPONDENT(S): RESPONDENTS/COMPLAINANT** **---------------------------------------------------------** **1. M/S. HONGKONG AND SHANGHAI BANKING CORPORATION LTD., POST BOX NO.2244, VELLAYAMBALAM, THIRUVANANTHAPURAM - 695 001.** **2. THE STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM.** **R1 BY ADVS. SRI.LAL K.JOSEPH SRI.A.A.ZIYAD RAHMAN** **SRI.K.S.SREELY KUMAR** **SMT.M.C.SANITHA** **R2 BY PUBLIC PROSECUTOR SRI.M.R.VENUGOPAL** **THIS CRIMINAL REVISION PETITION HAVING COME UP FOR ADMISSION ON 23/08/2011, ALONG WITH CRRP. NO.1833/2011 THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **svs** ## **S.S.SATHEESACHANDRAN, J** ## **-------------------------------------Crl.R.P Nos.1832 OF 2011 AND 1833 OF 2011 ------------------------------------------------------Dated this the 23[rd] day of August 2011** ## **ORDER** The common revision petitioner in the aforenumbered two revisions was prosecuted as the accused in two complaint cases by the common 1[st] respondent for the offence punishable under Section 138 of the Negotiable Instruments Act (for short, NI Act). Negativing the plea of not guilty canvassed by the petitioner/accused, in both cases, after trial, the learned Magistrate convicted him of the offence as stated. 2. Crl. R.P No.1832/2011 emerges from the complaint numbered as S.T No.580/2006 on the file of the Judicial First Class Magistrate - VI, Thiruvananthapuram. Complaint in that case related to the dishonour of a cheque issued by the petitioner/accused for a sum of `.1,54,589/- towards partial discharge of a liability arising out of a loan transaction availed from the complainant, a bank. In that case, the learned Magistrate, on finding the accused guilty, convicted and sentenced him to undergo simple imprisonment for four months and to pay compensation of `.3,09,178/-, double the cheque amount, with default term of further simple imprisonment for one month more. The accused had unsuccessfully preferred an appeal challenging the conviction. The learned Sessions Judge dismissed the Crl.R.P Nos.1832 and 1833/2011 - 2 - appeal, but, modified the sentence directing him to undergo simple imprisonment for four months. Compensation awarded with default term was vacated by the learned Sessions Judge. 3. Crl.R.P No.1833/2011 arises from S.T.No.1598/2007 on the file of the Judicial First Class Magistrate - X, Thiruvananthapuram. Complaint in that case related to the dishonour of a cheque for a sum of `.62,00,000/-. Convicting the accused, the learned Magistrate sentenced him to undergo imprisonment for one year. In the appeal preferred against the conviction and sentence in the above case, the learned Additional Sessions Judge, affirming the conviction, modified the sentence limiting it to a period of imprisonment for six months. 4. Notice given in the respective revisions, the 1[st] respondent/complainant bank has entered appearance. When the revisions came up for consideration, the learned counsel for the petitioner/accused, knowing of the circumscription within which exercise of revisional jurisdiction is permissible to interfere with the concurrent finding of guilt rendered in the two complaint cases, confined his submissions to the sentence imposed, seeking its modification, pointing out that a substantial portion of the liability due to the bank over the loan transaction availed, now, stand discharged pursuant to the sale of the mortgage property furnished as security for such loan by the proceedings initiated under the Crl.R.P Nos.1832 and 1833/2011 - 3 - SARFAESI Act by the complainant bank. A sum of `.56,00,000/- had been realised by the bank by such sale, is the submission of the counsel. The petitioner/accused requires a breathing time to pay the remaining liability due to the bank, is the further submission of the counsel urging for providing such time modifying the substantive term of imprisonment limiting it to one of compensation with default term. Sale of the mortgaged property furnished as security for the loan transaction, in respect of which the cheque involved in the case had been issued towards partial discharge of the liability thereunder, for a sum of `.56,00,000/-, is not disputed by the learned counsel for the 1[st] respondent/ complainant bank. Further, it is submitted that even at the time when such coercive steps were proceeded under the SARFAESI proceedings, more than `.1,23,00,000/- was outstanding on the loan extended to the revision petitioner/accused, which was for a sum of `.80,00,000/- payable in equal monthly instalments with interest fixed and agreed upon. Though the mortgaged property furnished as security, after sale, could not wipe off the entire liability due under the loan transaction since the balance amount still to be paid by the accused to clear such liability is far in excess of the amount covered by the cheque, the bank is prepared to have a settlement, if a sum of `.60,00,000/- in lump is paid by the accused, is the submission of the counsel for the respondent bank. Crl.R.P Nos.1832 and 1833/2011 - 4 - 5. So far as in the revisions, I find, there is no consensus between the parties over the terms of settlement. A composition of the offence as under Section 147 of the NI Act is permissible only following the guidelines given by the apex court in “Damodhar S Prabhu v Sayed Babalal” (2010(2) KLT 587(SC)) and that too where there is a settlement. That being so, no inquiry or dilation with respect to the suggestions made by the learned counsel for the complainant bank need be looked into. 6. Going through the judgments rendered by the learned Sessions Judge, with reference to the sentence awarded, I find, the term used as 'imprisonment' fixing the period of prison term in the respective cases, was not proper and correct. 'Imprisonment' means 'rigorous imprisonment' if it is not specifically stated as 'simple imprisonment'. In the two complaint cases, the learned Magistrate has sentenced the accused to undergo simple imprisonment only, in one case with direction to pay compensation. So much so, when in appeal, modifying the sentence, the learned Sessions Judge has used the term 'imprisonment', it would amount to enhancement to the sentence. That at any rate is not permissible when the appeals have been preferred by the accused challenging his conviction, and there is no appeal by the complainant questioning the propriety and correctness of the sentence. I do take note that the usage of Crl.R.P Nos.1832 and 1833/2011 - 5 - 'imprisonment' without referring it as 'simple imprisonment' by the learned Sessions Judge, most probably was an inadvertent mistake; but, the consequences thereof if not pointed out may be too harsh against the person sentenced with such punishment. 7. So far as the request made by the learned counsel for the accused for modification of the sentence of substantive term of imprisonment imposed and also request for extension of time to pay the amount involved, it is seen that prosecution of the accused on the basis of the cheques issued by him, on dishonour, had commenced in 2005. A portion of the liability towards the complainant bank had been discharged, not voluntarily, but, under the coercive steps taken by the bank resorting to SARFAESI proceedings is not a ground for considering favourably the request canvassed as aforesaid. The amount involved in one of the two cheques, at least, is substantial ie, `.62,00,000/-. However, the fact remains that dishonour of a cheque may arise very often for reasons beyond the contemplation of the drawer at the time of issuing of that instrument. Substantive term of imprisonment of an offender found guilty of the offence under Section 138 of the NI Act, directing his incarceration for a term, need be resorted to only if the facts involved in the case spell out that exceptional circumstances justify such a harsh punishment against him. On the facts involved in both the Crl.R.P Nos.1832 and 1833/2011 - 6 - cases, from the submissions made by the counsel on both sides, I find, no such exceptional circumstance warranting severe punishment against the revision petitioner/accused, to direct his incarceration for a term as fixed by the learned Sessions Judge. Submissions made by the counsel for the accused that on account of the financial difficulties faced by him on failure of his business he could not clear off the liability to the bank and the cheques happened to be dishonoured for the reasons beyond his control as such, are not liable to be brushed aside. Taking note of the submissions made as above and also the facts and circumstances involved, I find, sentence imposed against the revision petitioner/accused requires modification, however, safeguarding the interest of the complainant bank, which, no doubt, would be more insulated by providing the cheque amount as compensation with default term of imprisonment. 8. Affirming the conviction imposed against the accused in both the cases, sentence is modified as hereunder. In the complaint numbered as S.T No.580/2006, the revision petitioner/accused is directed to undergo simple imprisonment for a day, till the rising of the court and also to pay compensation of `.1,54,589/- with default term for a period of three months. In the other complaint case numbered as S.T.No.1598/2007 the revision petitioner/accused is directed to undergo simple imprisonment for a day, till the rising of Crl.R.P Nos.1832 and 1833/2011 - 7 - the court and to pay compensation of `.60,00,000/- to the complainant under Section 357(3) of the Code of Criminal Procedure with default term of imprisonment for six months. Substantive term of imprisonment imposed in both cases, imprisonment for a day till the rising of the court, that alone, is directed to be undergone concurrently. 9. The accused shall appear before the Magistrate on 01-11-2011 to serve out the substantive term of imprisonment imposed, for a day, till the rising of the court, and also to report payment of the compensation. Till the date of appearance fixed as above, time is granted to the accused to pay the compensation and, thus, avoid the default term of imprisonment. In the event of nonappearance of the accused and nonpayment of the compensation, the learned Magistrate shall execute the sentence in accordance with law. Sd/- vdv ## **S.S.SATHEESACHANDRAN, JUDGE** ## **//True Copy//** ## **P.A to Judge**