P. Mohammed v. Shriram Investments Ltd. & State of Kerala

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE N.ANIL KUMAR** **THURSDAY, THE 30TH DAY OF JULY 2020 / 8TH SRAVANA, 1942** **Crl.Rev.Pet.No.520 OF 2010** **AGAINST THE JUDGMENT IN Crl.APPEAL No.567/2008 ON THE FILE OF THE SPECIAL ADDITIONAL SESSIONS COURT (MARAD CASES), KOZHIKODE DTD.26.11.2009 IN S.T.No.221/2006 ON THE FILE OF THE JUDICIAL FIRST CLASS MAGISTRATE COURT-IV, KOZHIKODE DTD.30.05.2008** ## **- REVISION PETITIONER/APPELLANT/ACCUSED:** **P.MOHAMMED, S/O.MOIDEENKUTTY, PALAPPETTY HOUSE, OZHUKUR, MONGAM, MALAPPURAM.** **BY ADV.SRI.T.R.HARIKUMAR** ## **RESPONDENTS/RESPONDENTS/COMPLAINANT& STATE:** **1 M/S.SHRIRAM INVESTMENTS LTD., CALICUT, REPRESENTED BY POWER OF ATTORNEY HOLDER, MR.VENUGOPALAN.P.T., S/O.GOVINDA MENON, SREEPADAM BUILDINGS, CALICUT-32. 2 STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, KOCHI.** **R2 BY SENIOR PUBLIC PROSECUTOR SRI.M.S.BREEZ AMICUS CURIAE SRI.K.V.SREERAJ** **THIS CRIMINAL REVISION PETITION HAVING BEEN FINALLY HEARD ON 23-07-2020, THE COURT ON 30-07-2020 PASSED THE FOLLOWING:** Crl.R.P.No.520 of 2010 ..2.. ## **ORDER** This revision is directed against the judgment dated 26[th] November, 2009 in Crl.Appeal No.567/2008 rendered by the Special Additional Sessions Court (Marad Cases), Kozhikode confirming the conviction and sentence under Section 138 of the Negotiable Instruments Act in S.T.No.221/2006 on the file of the Judicial First Class Magistrate Court-IV, Kozhikode. 2. By judgment dated 30.5.2008, the learned Magistrate convicted and sentenced the accused to undergo simple imprisonment for three months and to pay a sum of Rs.1,10,000/- as compensation to the complainant under Section 357(3) of Cr.P.C. and in default of payment of compensation to undergo simple imprisonment for three months more. Parties are hereinafter referred to as 'the complainant' and 'the accused' according to their status in the trial court unless otherwise stated. 3. It is the case of the complainant that the accused issued a cheque dated 22.8.2005 for Rs.1,10,000/- in the name of the complainant towards repayment of the loan. But Crl.R.P.No.520 of 2010 **==> picture [22 x 8] intentionally omitted <==** the cheque was returned unpaid with the endorsement "funds insufficient" on 30.8.2005. On 24.9.2005, the complainant issued a legal notice to the accused through his Advocate calling upon him to pay the cheque amount. The said notice, sent by registered post duly served on the accused on 27.9.2005. The accused, however, did not reply to the notice, nor did he pay the amount covered under the cheque to the complainant. 4. The complainant filed a criminal complaint under Section 138 of the N.I.Act before the trial court. Upon consideration of the complaint, the learned Magistrate was prima facie satisfied that a case was made out against the accused. Hence, the learned Magistrate took cognizance of the offence under Section 138 of the N.I.Act and the case was taken on file as S.T.No.221/2006. 5. On service of summons, the accused appeared before the trial court. Copies of records relied on by the complainant were served on him. Particulars of the offence were read over and explained to the accused to which he Crl.R.P.No.520 of 2010 **==> picture [22 x 8] intentionally omitted <==** pleaded not guilty. Thereafter, the complainant was examined as PW1 and marked Exts.P1 to P10. After the witnesses for the complainant had been examined and before the accused was called on for his defence, the accused was questioned under Section 313(1)(b) of Cr.P.C. for the purpose of enabling the accused personally to explain any circumstance appearing in the evidence against him. He denied all the incriminating circumstances brought out in evidence. The accused did not adduce oral evidence but marked Ext.D1 through PW1. 6. On appreciation of evidence, the learned Magistrate held that execution of cheque was not denied by the accused and that it was proved by the complainant that the cheque was dishonoured on account of insufficient fund. 7. The trial court mainly relied on the oral evidence of PW1 and Exts.P1 to P10 and held that the defence pleaded by the accused was not established. The case of the complainant is that the accused availed financial facility in respect of the vehicle bearing registration No.KL-10/R.1337 from the complainant on 20.9.2003. It is his case that the accused Crl.R.P.No.520 of 2010 **==> picture [22 x 8] intentionally omitted <==** failed to pay installments and the vehicle was seized and sold by the complainant. Ext.P3 cheque was issued towards full and final settlement of the amount due towards the complainant. The complainant produced the lease agreement executed between the complainant and the accused and marked Ext.P9. It is a fact that execution of Ext.P9 agreement was not denied by the accused. Ext.P10 statement of account kept by the complainant in the regular course of business is also not seen disputed. 8. On appreciation of the evidence, the learned Magistrate held that execution of the cheque was admitted by the accused and it was proved by the complainant that the cheque was dishonoured on account of insufficient fund. 9. Heard Sri.T.R.Harikumar, the learned counsel for the revision petitioner, Sri.M.S.Breez, the learned Senior Public Prosecutor for the State and Sri.K.V.Sreeraj, Amicus Curiae. 10. In order to determine the question whether the offence punishable under Section 138 of the N.I. Act is made out, it is necessary to examine the penal provisions of Section Crl.R.P.No.520 of 2010 **==> picture [22 x 8] intentionally omitted <==** 138 of the N.I. Act and the presumptions to be raised as envisaged by the provisions of Sections 118 and 139 of the N.I. Act. Section 118 of the N.I. Act provides certain presumptions to be raised laying down some special rules of evidence relating to presumption. Section 139 of the N.I. Act provides that 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 of the N.I. Act for the discharge, in whole or in part, of any debt or other liability. Applying the definition of the word 'proved' in Section 3 of the Evidence Act to the provisions of Sections 118 and 139 of the Act, a presumption will have to be made that every negotiable instrument was made or drawn for consideration and that it was executed for discharge of debt or liability once the execution of negotiable instrument is either proved or admitted. Needless to say that, as and when the complainant discharges his burden to prove that the cheque was executed by the accused the rules of presumption under Sections 118 and 139 of the Act are very much available to the complainant Crl.R.P.No.520 of 2010 **==> picture [22 x 8] intentionally omitted <==** and burden shifts on the accused. 11. The presumptions under Sections 118 and 139 of the N.I. Act are rebuttable. Hence, it is the duty of the accused before the trial court by adducing evidence to show that the cheque was supported by consideration and that there was no debt or liability to be discharged as alleged. It is necessary on the part of the accused to set up a probable defence for getting the burden of proof to the complainant. Once such rebuttable evidence is adduced and accepted by the court, the burden shifts back to the complainant. The contention of the accused that the transaction being financed for his Mahindra Tipper vehicle, the burden was on the complainant to show the exact balance amount due from the accused. On going through the evidence, it is brought out that the accused availed financial facility from the complainant in respect of the vehicle bearing registration No.KL-10/R.1337 on 20.9.2003 and he failed to repay the installment as agreed to between the parties. Consequently, the vehicle was seized and sold by the complainant. It is further brought out that Ext.P3 cheque was Crl.R.P.No.520 of 2010 **==> picture [22 x 8] intentionally omitted <==** issued towards full and final settlement of the amount due towards the complainant. The defence version would indicate that the accused handed over cheque to the complainant. Having considered the materials on record, that the accused failed to adduce evidence to rebut the presumption or a probable case to shift the burden to the complainant. 12. In the case at hand, the accused has no case that he had not signed the cheque or parted with the same under any threat or coercion. That apart, the accused has no case that unfilled cheque had been lost irrecoverably or stolen by the complainant. It is not disputed that Ext.P3 cheque was issued under the signature of the accused. Though it is contended that the cheque was issued in another transaction between the complainant and the accused, there was no denial of execution of Ext.P3. Thus, the accused failed to prove during trial by leading cogent evidence that there was no debt or liability. 13. In **Bir Singh v. Mukesh Kumar [(2019) 4 SCC 197]** the Apex Court held that in view of Section 139 of the Crl.R.P.No.520 of 2010 ..9.. N.I. Act read with Section 118 of the Act thereof, the Court has to presume that the cheque has been issued for discharging a debt or liability. Paragraphs 39 and 40 of the above case are relevant in this context and the same is extracted below for convenience of reference:- _''39. It is not the case of the respondent-accused that he either signed the cheque or parted with it under any threat or coercion. Nor is it the case of the respondent-accused that the unfilled signed cheque had been stolen. The existence of a fiduciary relationship between the payee of a cheque and its drawer, would not disentitle the payee to the benefit of the presumption under Section 139 of the Negotiable Instruments Act, in the absence of evidence of exercise of undue influence or coercion. The second question is also answered in the negative._ _40. 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.''_ 14. In view of the discussion made hereinabove, this Court is of the view that the trial court as well as the appellate Crl.R.P.No.520 of 2010 ..10.. court rightly appreciated the evidence on record that the complainant had advanced the loan amount and the accused issued Ext.P3 cheque in full and final settlement of the same. 15. Having taken into consideration of the entire facts and circumstances of the case, this Court is of the view that no tenable grounds are brought out to interfere with the conviction rendered by the trial court as confirmed by the appellate court against the accused for the offence punishable under Section 138 of the N.I.Act. However, while maintaining the conviction, the sentence can be modified. 16. In the result, the Crl.Revision Petition is allowed in part. The sentence is modified as follows:- The accused is sentenced to pay a fine of Rs.1,10,000/(Rupees One lakh ten thousand only) for the offence punishable under Section 138 of the N.I.Act. In view of the Covid-19 pandemic outbreak throughout the State, the accused is given six months' time from this date to Crl.R.P.No.520 of 2010 ..11.. deposit the fine amount before the trial court failing which the accused shall undergo rigorous imprisonment for a period of three months. The said amount, if deposited, shall be released to the complainant as compensation in accordance with law. Sd/- **N.ANIL KUMAR, JUDGE** skj