PRABHAKARAN v. STATE OF KERALA AND Sreepadam Chits P. Ltd.

## `IN THE HIGH COURT OF KERALA AT ERNAKULAM` ## `PRESENT` ## `THE HONOURABLE MR.JUSTICE C.S.DIAS` ``` MONDAY, THE 25[TH] DAY OF SEPTEMBER 2023 / 3RD ASWINA, 1945 ``` ## `CRL.REV.PET NO. 1500 OF 2011` ``` AGAINST THE JUDGMENT DATED 19-4-11 IN CRA 385/2010 OF ADDITIONAL DISTRICT ``` ``` COURT (ADHOC) III, PALAKKAD AGAINST ACQUITTAL IN ``` ``` ST 4334/2004 OF JUDICIAL MAGISTRATE OF FIRST CLASS -II,PALAKKAD ``` ## `REVISION PETITIONER/ACCUSED:` ``` 1PRABHAKARAN MARUTHAROAD AMSOM,PALAKKAD. BY ADV SRI.K.M.KURIAN ``` ## `RESPONDENTS / APPELLANT/PETITIONER:` - `1 STATE OF KERALA REPRESENTED BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA.` - `2 SREEPADAM CHITS P. LTD 10/290, COLLEGE ROAD, PALAKKAD. REPRESENTED BY ITS POWER OF ATTORNEY AND MANAGER, K.SREEDHARAN. BY ADVS. SMT PUSHPALATHA M K, SR PP SRI.RAJESH SIVARAMANKUTTY` ``` THIS CRIMINAL REVISION PETITION HAVING COME UP FOR ADMISSION ON 25.09.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` ``` Crl. R.P. No.1500 of 2011 ``` ``` 2 ``` ## C. S. DIAS, J. `-------------------------` Crl.R.P. No.1500 of 2011 `-------------------------` Dated this the 25[th] day of September, 2023 ## ORDER The revision petition is filed questioning the correctness, propriety and legality of the judgment of the Court of Session, Palakkad Division in Crl.A. No.385/2010 convicting and sentencing the revision petitioner for an offence under Section 138 of the Negotiable Instruments Act, 1881 (in short, ‘N.I. Act’). The revision petitioner was the respondent and the second respondent was the appellant in the above appeal. The parties are, for the sake of convenience, referred to as per the status before the Trial Court. ``` Crl. R.P. No.1500 of 2011 ``` ``` 3 ``` ## Brief Facts 2. The complainant company had filed S.T. No.4334/2004 before the Judicial First Class Magistrate Court-II, Palakkad (Trial Court) against the accused, alleging that, on 17.08.1998, the accused had joined a kuri conducted by the complainant. He bid the kuri on 18.02.2002, but defaulted in paying the balance monthly instalments. Later, the accused issued Ext.P4 cheque in favour of the complainant for an amount of Rs.27,755/-. The cheque, on presentation to the bank for collection got dishonoured due to insufficiency of funds in the bank account of the accused. The complainant issued Ext.P6 lawyer notice to the accused. Even though he received the notice, he failed to pay the demanded amount. Hence, the accused committed the offence under Section 138 of the N.I. Act. ``` Crl. R.P. No.1500 of 2011 ``` ``` 4 ``` ## Trial 3. The accused pleaded not guilty to the substance of accusation read over to him. In the trial, the complainant examined PWs 1 and 2 and marked Exts.P1 to P9 in evidence. The accused confronted and marked Exts.D1 and D2. ## Trial Court Judgment 4. The Trial Court, after appreciating the materials on record, found the accused not guilty for the offence and acquitted the accused under Section 255(1) of the Code of Criminal Procedure (for brevity, ‘Cr.P.C’). 5. Aggrieved by the judgment passed by the Trial Court, the complainant/second respondent preferred Crl.A.No.385/2010 before the Appellate Court. ## Appellate Court Judgment 6. The Appellate Court, after re- appreciating the materials on record, by the ``` 5 ``` ``` Crl. R.P. No.1500 of 2011 ``` impugned judgment allowed the appeal and set aside the judgment of the Trial Court and found the accused/revision petitioner guilty for the offence under Section 138 of the N.I. Act and convicted and sentenced him to pay a fine of Rs.40,000/-, and in default to undergo simple imprisonment for a period of two months. 7. It is assailing the said judgment, the present revision petition is filed. 8. Heard; Sri.K.M.Kurian, the learned counsel appearing for the revision petitioner, Smt.Seetha.S, the learned Public Prosecutor appearing for the first respondent and Sri.Rajesh Sivaramankutty, the learned counsel appearing for the second respondent. 9. The principal contention of the learned counsel appearing for the revision petitioner/accused is that, Exts.P8 and P8 (a) statement of accounts produced by the ``` 6 ``` ``` Crl. R.P. No.1500 of 2011 ``` complianant read with Ext.D1 pass book and Ext.D2 receipt proves that the accused had remitted an amount of Rs.7,000/- for the period from 18.02.2002 to 17.08.2004. Therefore, the case put forth by the complainant in Ext.P6 lawyer notice and in the complaint that Ext.P4 cheque was issued in discharge of an amount of Rs.26,000/and the interest of Rs.1,755/-, i.e., a total amount of Rs.27,755/- is incorrect and wrong. Exts.P8 and P8(a) read with Exts.D1 and D2 substantiate that the accused had remitted an amount of Rs.7,000/-. Therefore, the complainant could launch the prosecution only for an amount of Rs.19,000/- plus interest. Hence, the prosecution is bad and the revision petition is to be allowed, by setting aside the impugned judgment of the Appellate Court. 10. The learned counsel appearing for the second respondent/complainant defended the judgment of the Appellate Court and contended ``` Crl. R.P. No.1500 of 2011 ``` ``` 7 ``` that this Court may not interfere with the finding of fact by invoking its powers under Sections 397 to 401 of the Cr.P.C. Hence, the revision petition may be dismissed. 11. Before I delve into the legality and correctness of the impugned judgments, this Court reminds itself of the scope and purport of the revisional jurisdiction under Sections 397 to 401 of the Cr.P.C. 12. There is a profusion of precedential authority that the revisional power of this Court is to be sparingly exercised and in exceptional rarity. The power is more in the nature of supervisory jurisdiction, to correct the miscarriage of justice, if any found. The revisional power cannot be equated with Appellate/Second Appellate power. Even if a different view is possible, the revisional Court shall not substitute the view taken by the ``` Crl. R.P. No.1500 of 2011 ``` ``` 8 ``` Trial/Appellate Court, unless and until there is patent illegality, which is shocking to the conscience of the Court. 13. In Ramrao Chavan vs Sanjaysinh Dattatray Gulabrao Phalke & Anr [(2015) 3 SCC 123] , the Hon’ble Supreme Court has succinctly laid down the scope and powers under Sections 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 nonconsideration 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. ``` Crl. R.P. No.1500 of 2011 ``` ``` 9 ``` 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. The complainant's case in Ext.P6 lawyer notice and the complaint is that the accused had bid the kuri for an amount of Rs.1,50,000/-. Thereafter, the accused defaulted in payment of the instalments and in discharge of his liability he issued Ext.P4 cheque. 15. Undisputedly, the accused has failed to send any reply notice, or has set up a defence in ``` Crl. R.P. No.1500 of 2011 ``` ``` 10 ``` his questioning under Section 313 of the Cr.P.C and has not let in any defence evidence. 16. It is only in the cross-examination of PWs 1 and 2, that the revision petitioner has set up the defence that he had paid an amount of Rs.7,000/- towards instalments for the period from 18.02.2002 to 17.08.2004. 17. A negotiable instrument, which includes a cheque, carries the presumption of consideration under Sections 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 ``` Crl. R.P. No.1500 of 2011 ``` ``` 11 ``` 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.” 18. A three-Judge Bench of the Hon’ble Supreme Court in Rangappa vs. Sri.Mohan [2010 KHC 4325] , while dealing with Section 139 of the N.I Act has 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 ``` Crl. R.P. No.1500 of 2011 ``` ``` 12 ``` 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 ``` Crl. R.P. No.1500 of 2011 ``` ``` 13 ``` 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 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. 15. Coming back to the facts in the present case, we are in agreement with the High Court's view that the accused did not raise a probable defence. As noted earlier, the defence of the loss of a blank cheque was taken up belatedly and the accused had mentioned a different date in the 'stop payment' instructions to his bank. Furthermore, the instructions to 'stop payment' had not even mentioned that the cheque had been lost. A perusal of the trial record also shows that the accused appeared to be aware of the fact that the cheque was with the complainant. Furthermore, the very fact that the accused had failed to reply to the statutory notice under S.138 of the Act leads to the inference that there was merit in the complainant's version. Apart from not raising a probable defence, the appellant - accused was not able to contest the existence of a legally enforceable debt or liability. The fact that the accused had made regular payments to the complainant in relation to the construction of his ``` Crl. R.P. No.1500 of 2011 ``` ``` 14 ``` house does not preclude the possibility of the complainant having spent his own money for the same purpose. As per the record of the case, there was a slight discrepancy in the complainant's version, in so far as it was not clear whether the accused had asked for a hand loan to meet the construction - related expenses or whether the complainant had incurred the said expenditure over a period of time. Either way, the complaint discloses the prima facie existence of a legally enforceable debt or liability since the complainant has maintained that his money was used for the construction - expenses. Since the accused did admit that the signature on the cheque was his, the statutory presumption comes into play and the same has not been rebutted even with regard to the materials submitted by the complainant. 19. 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. It is apposite to extract the relevant paragraphs, which declares the law on the point in the following terms: ``` Crl. R.P. No.1500 of 2011 ``` ``` 15 ``` “14. Adverting to the case in hand, we find on a plain reading of its judgment that the trial Court completely overlooked the provisions and failed to appreciate the statutory presumption drawn under Section 118 and Section 139 of NIA. The Statute mandates that once the signature (s) of an accused on the cheque/negotiable instrument are established, then these ‘reverse onus’ clauses become operative. In such a situation, the obligation shifts upon the accused to discharge the presumption imposed upon him. This point of law has been crystalized by this Court in Rohitbhai Jivanlal Patel v. State of Gujarat (2019 (2) KHC 243).” ## 20. Similarly, in M/s.Shree Daneshwari Traders vs Sanjay Jain [2019 (4) KHC 495], the Hon’ble Supreme Court has held as follows: “16. Under Section 138 of the Negotiable Instruments Act, once the cheque is issued by the drawer, a presumption under Section 139 of the Negotiable Instruments Act in favour of the holder would be attracted. Section 139 creates a statutory presumption that a cheque received in the nature referred to under Section 138 of the Negotiable Instruments Act is for the discharge ``` Crl. R.P. No.1500 of 2011 ``` ``` 16 ``` in whole or in part of any debt or other liability. The initial burden lies upon the complainant to prove the circumstances under which the cheque was issued in his favour and that the same was issued in discharge of a legally enforceable debt. 17. It is for the accused to adduce evidence of such facts and circumstances to rebut the presumption that such debt does not exist or that the cheques are not supported by consideration. Considering the scope of the presumption to be raised under Section 139 of the Act and the nature of evidence to be adduced by the accused to rebut the presumption.” 21. As discussed in the preceding paragraphs, the accused has failed to send a reply notice, has not given any cogent answers in his questioning under Section 313 of the Cr.P.C. or has he let in any defence evidence. 22. Matters would have been different had the accused had sent a reply to Ext.P6 lawyer notice stating that he had already paid an amount of Rs.7,000/- for the period from 18.02.2002 to ``` 17 ``` ``` Crl. R.P. No.1500 of 2011 ``` 17.08.2004 and only an amount of Rs.19,000/was due from him and he tendered the said amount, making his plea of discharge credible. Instead, the accused has maintained stoic silence. It is trite, the reverse onus of proof is on the accused under Section 139 of the N.I. Act to substantiate his defense and, only thereafter, the burden shifts to the complainant. 24. The Appellate Court has rightly concluded that the revision petitioner/accused has failed to discharge the reverse onus of proof by establishing a probable defense. I do not find any illegality or impropriety in the conclusion arrived at by the Appellate Court, that the revision petitioner had issued Ext.P4 cheque in discharge of a legally enforceable debt and has failed to discharge the reverse onus of proof under Section 139 of the N.I. Act. Thus, this Court confirms the conviction and sentence imposed by ``` Crl. R.P. No.1500 of 2011 ``` ``` 18 ``` ## the Appellate court. 25. At the said point of time, the learned counsel appearing for the revision petitioner prayed that the revision petitioner may be granted two months’ time to pay the fine amount fixed by the Appellate Court. 26. Taking into account the fact that this Court has suspended the execution of the sentence on 14.06.2011 and the revision petition is pending consideration before this Court for the last one decade, I find the above submission to be reasonable and justifiable. 27. In the result, - (i) The revision petition is dismissed; (ii) The conviction and sentence imposed by the Appellate Court stands confirmed; (iii) The revision petitioner is directed to appear before the Trial Court on or before 27.11.2023, to pay the fine amount and failing ``` Crl. R.P. No.1500 of 2011 ``` ``` 19 ``` which to undergo default sentence; (iv) The execution of the sentence shall stand deferred till 27.11.2023; (v) In case of failure of the revision petitioner to appear before the Trial Court as ordered above, the Trial Court shall execute the sentence, in accordance with law; (vi) Needless to mention, if the revision petitioner has deposited any amount pursuant to the orders of this Court, the same shall be given credit to at the time of paying off the balance fine amount; (vii) The Registry is directed to forthwith forward a copy of this order to the Trial Court for compliance. ## Sd/- C. S. DIAS JUDGE SKP/25-09