Lekshmikutty Amma v. Raveendran Pillai Pavithram and State of Kerala

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE C.S.DIAS** **MONDAY, THE 9[TH] DAY OF OCTOBER 2023 / 17TH ASWINA, 1945** **CRL.REV.PET NO. 321 OF 2011** **AGAINST THE ORDER/JUDGMENT CC 1032/2004 OF JUDICIAL MAGISTRATE OF** **FIRST CLASS , ADOOR CRA 20/2009 OF ADDITIONAL DISTRICT COURT (ADHOC)III,** ## **PATHANAMTHITTA** ## **REVISION PETITIONER/S:** LEKSHMIKUTTY AMMA, D/O/KESAVAN PILLAI, RESIDING AT SUNIL NILAYAM, MANNADIKALAYUKKU KIZHAKU, KADAMPANADU VILLAGE, PATHANAMTHITTA DIST. BY ADV SMT.C.S.SINDHU KRISHNAH ## **RESPONDENT/S:** 1 RAVEENDRAN PILLAI PAVITHRAM, MANNADI P.O., KADAMBANAD VILLAGE. 2 STATE OF KERALA REP. BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA,, ERNAKULAM. BY ADVS. SRI.SAJJU.S SRI.K.SHAJ SMT.S.SEETHA, PP THIS CRIMINAL REVISION PETITION HAVING COME UP FOR ADMISSION ON 09.10.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: CRL.REV.PET NO. 321 OF 2011 2 ## **ORDER** The revision petitioner calls in question the legality and correctness of the judgment passed in Crl.Appeal No.20/2009 by the Court of the Additional Sessions Judge (Adhoc) Fast Track Court-III, Pathanamthitta (Appellate Court) confirming the judgment passed in C.C.No.1032/2004 by the Court of the Judicial First Class Magistrate, Adoor (Trial Court), convicting and sentencing the revision petitioner for the offence under Section 138 of the Negotiable Instruments Act (in short, “N.I.Act”). The revision petitioner was the accused and the 1[st] respondent was the complainant before the Trial Court. ## The facts in brief: 2. The 1[st] respondent had filed the complaint against the revision petitioner, alleging her to have committed the offence under Section 138 of the N.I.Act on the assertion that the revision petitioner owed an CRL.REV.PET NO. 321 OF 2011 3 amount of Rs.6,18,000/- as per an agreement arrived at between the parties in respect of a petroleum retail outlet named 'Lakshmi Fuels'. In discharge of a legally enforceable debt, the revision petitioner had issued Exts.P1 and P2 cheques dated 18.03.2004 for an amount of Rs.2,00,000/- and Rs.4,18,000/- respectively. The cheques on presentation to the bank for collection got dishonoured by Exts.P3 and P4 memorandums due to insufficiency of funds in the bank account of the revision petitioner. The 1[st] respondent had issued Ext.P8 statutory lawyer notice to the revision petitioner, but she failed to pay the demanded amount. Hence, she had committed the offence. 3. The revision petitioner pleaded not guilty to the substance of accusation that was read over to her. In trial, the 1[st] respondent was examined as PW1 and Exts.P1 to P10 were marked in evidence. The revision petitioner examined her erstwhile counsel as DW 1 and marked Ext.D1 reply notice sent to Ext.P8 lawyer CRL.REV.PET NO. 321 OF 2011 4 notice and DW2, the Investigating Officer who filed Ext.D2 final report in Crime No.708/2004 of the Adoor Police Station. ## Trial Court Judgment 4. The Trial Court, after analysing the materials on record, convicted the revision petitioner for the offence under Section 138 of the N.I.Act and sentenced her to undergo simple imprisonment for a period of one year and to pay a compensation of Rs.6,18,000/- to the 1[st] respondent under Section 357(3) of the Code of Criminal Procedure (in short, “Cr.P.C.) and in default to undergo simple imprisonment for a further period of one month. 5. Aggrieved by the said judgment, the revision petitioner filed Criminal Appeal No.20/2009. ## Appellate Court judgment 6. The Appellate Court, after re-appreciating the CRL.REV.PET NO. 321 OF 2011 5 materials on record, by the impugned judgment, dismissed the appeal by confirming the conviction and sentence. 7. It is assailing the concurrent judgments passed by the courts below, the revision petition is filed. 8. Heard; Smt.Sindhu Krishna, the learned Counsel appearing for the revision petitioner; Sri.K.Shaj, the learned Counsel appearing for the 1[st] respondent and Smt.Seetha S., the learned Public Prosecutor appearing for the 2[nd] respondent-State. 9. Smt.Sindhu Krishna argued that the courts below have gone wrong in holding that the revision petitioner has committed the offence under Section 138 of the N.I.Act. She contended that the courts below have not appreciated Ext.P10 agreement, Ext.D1 reply notice and the oral testimonies of PW1 and DW1 in their proper perspective. According to her, PW1 has admitted in his cross categorically CRL.REV.PET NO. 321 OF 2011 6 examination that the petroleum retail outlet was not transferred to the revision petitioner as agreed in Ext.P10 agreement. Therefore, there was no legally enforceable debt. Moreover, there is nothing on record to substantiate the role of the 1[st] respondent in Lakshmi Fuels. A reading of Ext.P10 would show that Exts.P1 and P2 cheques were issued as the consideration for the retirement of the 1[st] respondent from the firm. Other than for the bald statement of the 1[st] respondent in his oral testimony, that he was partner in the firm, there was nothing placed on record to prove the said aspect. PW1 also categorically admitted that the petroleum retail outlet was not transferred to the revision petitioner. Likewise, PW1 failed to examine Indira Devi, who was a material witness. Exts.P1 and P2 were only issued as security and not towards any legally enforceable debt. The prosecution has miserably failed to establish the ingredients of Section 138 of the N.I.Act. Hence, the CRL.REV.PET NO. 321 OF 2011 7 revision petition may be allowed. 10. Sri.K.Shaj, defended the impugned judgments and contended that the revision petitioner has failed to discharge the reverse onus of proof under Section 139 of the N.I.Act. Therefore, there is no ground made out to interfere with the impugned judgments. Hence, the revision petition may be dismissed. 11. Is there any illegality, impropriety or irregularity in the judgments of the courts below. 12. It is trite that the revisional powers of this Court under Sections 397 to 401 of the Cr.P.C. is to be sparingly exercised and in cases of exceptional rarity. Unless there is manifest error, illegality or an apparent misreading of the records, this Court shall not interfere with the findings of fact rendered by the fact finding courts. Merely because a different view is possible, the revisional Court shall not substitute the views of the Trial/Appellate Courts. CRL.REV.PET NO. 321 OF 2011 8 ## 13. In **Sanjaysinh Ramrao Chavan vs Dattatray** **Gulabrao Phalke & Anr** [(2015) 3 SCC 123], the Hon’ble Supreme Court has succinctly laid down the scope and purport of the powers under Secs.397 to 401 of the Cr.P.C. It is apposite to extract the revisional declaration of law, which reads as follows: “14. In the case before us, the learned Magistrate went through the entire records of the case, not limiting to the report filed by the police and has passed a reasoned order holding that it is not a fit case to take cognizance for the purpose of issuing process to the appellant. Unless the order passed by the Magistrate is perverse or the view taken by the court is wholly unreasonable or there is non- consideration of any relevant material or there is palpable misreading of records, the Revisional Court is not justified in setting aside the order, merely because another view is possible. The Revisional Court is not meant to act as an appellate court. The whole purpose of the revisional jurisdiction is to preserve the power in the court to do justice in accordance with the principles of criminal jurisprudence. The revisional power of the court under Sections 397 to 401 CrPC is not to be equated with that of an appeal. Unless the finding of the court, whose decision is sought to be revised, is shown to be perverse or untenable in law or is grossly erroneous or glaringly unreasonable or where the decision is based on no material or where the material facts are wholly ignored or where the judicial discretion is exercised arbitrarily or capriciously, the courts may not interfere with decision in exercise of their revisional jurisdiction.” ## 14. Now, coming back to the facts of the case at hand. CRL.REV.PET NO. 321 OF 2011 9 15. The complainant's case in Ext.P8 lawyer notice is that Exts.P1 and P2 are issued in discharge of a legally enforceable debt. In the complaint, the 1[st] respondent reiterated the allegation in the lawyer notice and averred that the cheques got dishonoured due to insufficiency of funds in the account of the revision petitioner. Although the statutory notice was sent, the revision petitioner failed to pay the demanded amount. 16. In trial, the 1[st] respondent was examined as PW1 and he marked Exts.P1 to P10 in evidence. Ext.P10 is the tripartite agreement executed between the revision petitioner, 1[st] respondent and one Indira Devi, the wife of the 1[st] respondent’s brother. It is borne out from the records that Indira Devi was awarded with the petroleum retail outlet by the Bharat Petroleum Corporation Ltd. under the War Widow’s Scheme. CRL.REV.PET NO. 321 OF 2011 10 17. A reading of Ext.P10 agreement and the oral testimony of PW1 shows that Exts.P1 and P2 were issued by the revision petitioner towards consideration for the 1[st] respondent to retire from Lakshmi Fuels, and then the firm to be reconstituted by inducting the revision petitioner as a partner with Indira Devi. Later, on Indira Devi getting consent from the Petroleum Company, the exclusive dealership of the firm would be given to the revision petitioner. 18. Indisputably, PW1 has admitted in his crossexamination that the petroleum outlet is not functioning. 19. The revision petitioner in Ext.D1 reply notice has specifically stated that she had issued Exts.P1 and P2 cheques as security for obtaining the dealership of Lakshmi Fuels. In order to substantiate her defence, she examined DW1 – the lawyer, who issued Ext. D1 reply notice, and DW2 – the Investigating Officer – who CRL.REV.PET NO. 321 OF 2011 11 filed the final report in Crime No.708/2004 of the Adoor Police Station, registered on the basis of a private complaint lodged by the revision petitioner as against the person to whom a bribe was allegedly paid for getting the dealership. 20. A negotiable instrument, which includes a cheque, carries the presumption of consideration under Secs.118(a) and 139 of the N.I Act. It is profitable to extract the said relevant provisions: “118. Presumptions as to negotiable instruments – Until the contrary is proved, the following presumptions shall be made;- (a) of consideration-that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration; 139. Presumption in favour of 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”. ## 21. A three-Judge Bench of the Hon’ble Supreme Court in **Rangappa vs. Sri.Mohan** [2010 KHC 4325], while dealing with Sec.139 of the N.I Act has CRL.REV.PET NO. 321 OF 2011 12 ## conceptualised the doctrine of ‘reverse onus’, by holding thus: “ 18. In light of these extracts, we are in agreement with the respondent - claimant that the presumption mandated by S.139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat (supra) may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant. S.139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While S.138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under S.139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by S.138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused / defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under S.139, the standard of proof for doing so is that of 'preponderance of probabilities'. **Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials** CRL.REV.PET NO. 321 OF 2011 13 **submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his / her own.** (emphasis given) 22. Recently, a three-Judge Bench of the Hon’ble Supreme Court in **Kalamani Tex and Anr vs. P. Balasubramanian** [2021 (2) KHC 517] has reiterated the legal position and doctrine of the reverse onus. 23. Thus, the law has crystallized that once the complainant establishes the concoction of the five ingredients under Section 138 of the N.I.Act, then the reverse onus of proof shifts to the accused to set up a probable defence. If he discharges the onus of proof and casts a doubt about the existence of a debt, then the prosecution has to fail. 24. It is pertinent to note that the 1[st] respondent had not produced any material to establish that he was a partner of Lakshmy Fuels, and also failed to examine Indira Devi and the witnesses to Ext.P10 agreement, CRL.REV.PET NO. 321 OF 2011 14 who were all material witnesses. Admittedly, PW1 also testified that Lakshmy Fuels is not functioning. 25. On going through the impugned judgments of the courts below, it is deciphered that both Courts have failed to advert and discuss the oral testimonies of PW1 and DW1. Instead, the Courts have only discussed about Exts.P1 to P10 documents and concluded that the revision petitioner has not discharged the reverse onus of proof under Section 139 of the N.I. Act. 26. There is no discussion regarding Ext.D1 reply notice, the statement of the revision petitioner u/s 313 of the Cr.P.C. and the testimonies of the defense witnesses and documents. Thus, I am of the definite view that the courts below have misread the materials on record and have perfunctorily concluded that the revision petitioner has committed the offence u/s 138 of N.I. Act, which is improper, irregular and illegal, and warrants interference by this Court. Thus, I allow the CRL.REV.PET NO. 321 OF 2011 15 revision petition by remanding the matter back to the Appellate Court for fresh consideration, untrammelled by any observation made in this order. In the result, - (i) The revision petition is allowed - (ii) The impugned judgment passed by the Appellate Court is set aside. - (iii) The parties are directed to appear before the Appellate Court on 01.12.2023. - (iv) The Registry is directed to forthwith transmit the lower court records to the Appellate Court. - (v) The Appellate Court shall consider and dispose of Crl.A. No.20/2009 afresh, after affording both sides an opportunity of being - heard, untrammelled by any observation made in this order. - (vi) As the appeal is of the year 2009, the Appellate Court shall make every CRL.REV.PET NO. 321 OF 2011 16 endeavour to dispose of the appeal, as expeditiously as possible. Sd/- **C.S.DIAS JUDGE** rkc/09.10.23