PRIYESH, S/O. BHASKARAN NAIR v. SREEGURUVAYURAPPAN CHIT PVT. LTD. & THE STATE REPRESENTED BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS** **THURSDAY, THE 15TH DAY OF JUNE 2017/25TH JYAISHTA, 1939** ## **Crl.Rev.Pet.No. 245 of 2017** **----------------------------------------AGAINST THE JUDGMENT IN CRL.A.NO. 240/2016 OF 1ST ADDITIONAL SESSIONS COURT, KOZHIKODE** **AGAINST THE JUDGMENT IN C.C.NO. 103/2014 OF JUDICIAL FIRST CLASS MAGISTRATE COURT-II, VADAKARA** **------------------** ## **REVISION PETITIONER(S)/APPELLANT/ACCUSED :** ## **----------------------------------------------------------------------------** **PRIYESH, S/O. BHASKARAN NAIR, AGED 36 YEARS, KRISHNAPRIYA, PUTHALATH HOUSE, VARIKKOLI P.O., KAKKATTIL VIA.** **BY ADVS. SRI.SANTHARAM.P SMT.REKHA ARAVIND** ## **RESPONDENT(S)/RESPONDENTS/COMPLAINANT & STATE :** **-----------------------------------------------------------------------------------------** **1. SREEGURUVAYURAPPAN CHIT PVT. LTD., REGISTERED OFFICE AT 156, TH ROAD, CHENNAI 19, ITS MANAGING DIRECTOR K.BALAN, AGED 68 YEARS, S/O. KRISHNAN, NEW NO. 20/2, OLD NO. 382/2, ESI MANADAPAM ROAD, KILPAUK, CHENNAI 10, REP. BY ITS POWER OF ATTORNEY HOLDER RAVEENDRAN NAMBAIR, AGED 61 YEARS, KEEZHAL, VATAKARA TALUK, KOZHIKODE DISTRICT.** **2. THE STATE REPRESENTED BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM.** ## **R2 BY PUBLIC PROSECUTOR SRI. JESTIN MATHEW** **THIS CRIMINAL REVISION PETITION HAVING BEEN FINALLY HEARD ON 12-04-2017, THE COURT ON 15-06-2017 PASSED THE FOLLOWING:** Msd. ## ALEXANDER THOMAS, J. ----------------------------- Crl.R.P.No.245 Of 2017 --------------------------------- Dated this the 15th day of June, 2017. ## O R D E R The petitioner is the accused for the offence under Sec.138 of the Negotiable Instruments Act, in C.C.No.103/2014 on the file of the Judicial First Class Magistrate Court-II, Vatakara, instituted on the basis of a complaint filed by R-1 herein. The trial court as per the impugned judgment rendered on 30.4.2016 had convicted the petitioner for the above said offence and sentenced him to undergo imprisonment for six months and to pay a fine of Rs.2.52 lakhs and the fine amount was ordered to be paid to the complainant under Sec.357(1)(b) of the Cr.P.C., and in default thereof the accused was sentenced to undergo simple imprisonment for a further period of 2 months. Aggrieved thereby, the petitioner has preferred Crl.A.No.240/2016 before the Sessions Court, Kozhikode. The appellate court concerned [Court of Additional Sessions Judge-I, Kozhikode], as per the impugned judgment dated 27.10.2016 had upheld the conviction and modified the substantive sentence to imprisonment till the rising of the court and confirmed the fine amount and its default clause. It is aggrieved by ::2:: Crl.R.P.No.245 Of 2017 these verdicts, that the petitioner has preferred the instant Crl.R.P by taking recourse to the remedy under Sec.397 r/w Sec.401 of the Cr.P.C. 2. Though notice has been duly served on R-1 complainant, there is no appearance for that party. 3. Heard Sri.P.Santharam, learned counsel appearing for the revision petitioner-accused and Sri.Jestin Mathew, learned Prosecutor appearing for R-2 State. As stated hereinabove, inspite of due service of notice, there is no appearance for R-1. 4. The gist of the case of the complainant is that on account of a liability of Rs.2,13,258/- owed by the petitioner to the complainant chit company, the petitioner-accused had issued the instant Ext.P-2 cheque dated 4.11.2013 for Rs.2,13,258/- drawn from the account of the petitioner and payable to the complainant and that the cheque when presented was dishonoured as evident from Exts.P-3 & P-4 memos and that thereupon the complainant issued Ext.P-5 statutory demand notice dated 10.12.2013 in terms of Sec.138 proviso (b) of the Negotiable Instruments Act, calling upon the accused to pay off the amount covered by the dishonoured cheque within 15 days. The said notice was returned as per Ext.P-7, etc. During the trial, the complainant has examined the branch manager of the complainant chit ::3:: Crl.R.P.No.245 Of 2017 company as PW-1 and marked Exts.P-1 to P-10 documents. The defence has not adduced any oral or documentary evidence. 5. The basic defence set up by the accused is that he never had any transaction with the 1st respondent chit company and that he had some transaction with some other person, viz, one Sri.Ramakrishnan, in purchasing some articles on instalment basis and for that transaction he was constrained to give the instant Ext.P-1 blank signed cheque as security and that the said person, who was a chit subscriber of the chit company, had colluded with the complainant and that the petitioner's cheque has been thus misused by the complainant for the purpose of instituting the present complaint, etc. Since the petitioner has admitted that the signature of the cheque is that of his and that the cheque has been drawn from the bank account maintained by the petitioner, it can be held that the complainant could draw the benefit of statutory presumption under Sec.139 of the N.I.Act in view of the legal principles laid down by the Apex Court in T.Vasanthakumar v. Vijayakumari reported in (2015) 8 SCC 378. However, on a meticulous consideration of the various aspects of the impugned judgments of the courts below as well as the evidentiary aspects on record, this Court is of the considered opinion that both the courts below have shut out vital and relevant ::4:: Crl.R.P.No.245 Of 2017 evidentiary aspects in favour of the petitioner and further that the complainant has varied his stand from various stages of the matter and that the complaint is vitiated by suppression of crucial and material particulars of the transaction, etc. In view of these aspects, this Court is of the considered view that the petitioner could successfully and effectively rebut the said statutory presumption drawn under Sec.139 of the N.I. Act and as the complainant has not thereafter proved the transaction in the case, the accused is entitled for acquittal. The reasons for arriving at this considered conclusion are given hereinafter: 6. In Ext.P-5 demand notice dated 10.12.2013, the complainant has no case that the liability was one which was owed by one Sri.Ramakrishnan, as subscriber of the chit and that the complainant had either volunteered to take up the liability of Ramakrishnan or that he stood as surety to the transaction, etc. The specific case in Ext.P-5 demand notice dated 10.12.2013 issued by the company is to the effect that the liability of Rs.2,52,000/- is that of the petitioner. No details of any transaction between the petitioner and the complainant detailing out as to how the said liability has occurred, etc., are completely omitted to be stated in the complaint. There are no averments in the statutory demand notice and in the complaint as to ::5:: Crl.R.P.No.245 Of 2017 when exactly the cheque in question was executed and issued by the accused to the complainant company. That apart, there is no whisper in the averments made in the said complaint about the said Ramakrishnan and about the details of chit transactions entered by him with the company and about the date of commencement and termination of the chit, payment made, payment of defaulted amount and as to how the liability has arisen, etc. However, in the complaint, an entirely different case is projected by the complainant company, wherein the allegations are that the accused happened to be a relative of Ramakrishnan, who was the chit subscriber of the complainant company and that the said Ramakrishnan had defaulted payment and that Ramakrishnan did not pay the amount owed by the complainant and the petitioner, who was a relative of Ramakrishnan, had voluntarily come forward so as to take over the liability of Ramakrishnan by issuing the cheque dated 4.11.2013 for the above said amount. It is interesting to note that even in the complaint, no details of the chit transaction, which was said to have been entered into by Ramakrishnan with the company and about the date of commencement and termination of the chit, payment made, payment of defaulted amount and how many instalments due from the subscriber and how many instalments paid by him and the details of ::6:: Crl.R.P.No.245 Of 2017 defaulted amounts and as to how the liability amount of Rs.2,13,258/was arrived at, etc., are completely omitted to be stated therein. The sworn statement given by the complainant at Sec.200 Cr.P.C stage is also ditto of the complaint and it has also the above said defects in the complaint. Later, in the proof affidavit filed by the complainant in lieu of chief examination, entirely different case is set up therein by stating that the petitioner happened to be the guarantor/surety to the said Ramakrishnan in the above transaction and further that he also happened to be a relative of Ramakrishnan, etc. Even in the proof affidavit, it is conspicuously silent about the chit agreement, date of commencement of the chit, date of termination of the chit, whether the subscriber had received any prized amount, how many instalments made, defaulted instalments and as to how the liability has arrived at, etc. So, when it comes to the proof affidavit, the complainant has a new story that the accused is not only a relative of Ramakrishnan but also is a guarantor of subscriber and for showing that the accused is guarantor of the subscriber, Ext.P-9 promissory note dated 12.12.2005 said to have been executed by one Sri.Prajeesh has been produced along with the proof affidavit. Later an additional proof affidavit was filed thereby producing Ext.P-10 ledger. Therefore, since the statutory demand ::7:: Crl.R.P.No.245 Of 2017 notice and the complaint are conspicuously silent about the aforementioned crucial details and material particulars regarding the very transaction, the complaint itself should have been thrown out and the accused is entitled for acquittal in the light of the legal principles laid down by this Court in K.K.Divakaran v. State of Kerala reported in 2016 (4) KLT 233. In the said judgment, this Court has categorically held that in a criminal trial the accused is primarily called upon to defend himself on the gravamen of charges and allegations raised in the complaint and the omission to state the crucial and material particulars regarding the transaction which led to the liability would be depriving of a fair and reasonable opportunity to the accused to defend himself in the trial as he is unaware what exactly he has to defend and this would amount to clear and manifest deprivation of the right to free trial guaranteed to an accused under Article 21 of the Constitution of India. It would be relevant to note the legal principles laid down in K.K.Divakaran's case (Supra) in paras 18 & 20 which read as follows: “18. Before she filed the complaint the second respondent sent Ext.P4 statutory notice to the revision petitioner informing him about the dishonour of the cheque and demanding payment of the amount covered by it. Neither the nature, nor the date of the transaction between the parties nor the date of issuance of the cheque was disclosed in it. There was only a bald statement that the revision petitioner issued a cheque bearing the date 11.1.1999 for Rs.2,55,000/- in discharge of a debt. There is no explanation why these material facts were not disclosed in the statutory notice. Suppression of material facts relating to the alleged transaction in the notice issued ::8:: Crl.R.P.No.245 Of 2017 before filing the suit or the complaint is an artifice used by certain litigants, the intention of which is very clear. They want to develop a story after knowing the defence that may be set up by the opposite party. The doors of the court should be closed to such fortune seekers. **==> picture [229 x 5] intentionally omitted <==** 20. In a criminal case the accused should be informed before the trial not only of the nature of the offence but also the particulars of the transaction which are necessary for him to effectively meet the case against him. But unscrupulous complainants refuse to do so with the object of denying the accused a fair trial, which is a right guaranteed under Article 21 of the Constitution. An accused in a complaint case filed under Section 142 of the Act also is entitled to know before the trial the particulars of the accusation against him. Suppression of these particulars in the complaint alone is sufficient to order his acquittal.” In view of the above factual aspects and in the light of the aforementioned legal principles, this Court has no hesitation to hold that the complainant has come with unclean hands by suppressing crucial and material aspects which has deprived the accused his precious right of free trial and on this ground alone, the accused is entitled to acquittal. This Court fails to fathom as to how both the courts below omitted to take into consideration the above said crucial and relevant aspects of the matter. Apart from the above aspects, the following aspects would also clearly show that the petitioner could effectively and strongly rebut the statutory presumption. 7. As stated hereinabove, the initial case set up by the complainant in the statutory demand notice is that the liability was ::9:: Crl.R.P.No.245 Of 2017 owed by the petitioner to the complainant company and the complainant has no case about the role of the chit subscriber Sri.Ramakrishnan. Thereafter, the complainant comes with the story that the accused is a relative of Ramakrishnan, who has voluntarily taken over the liability and issued the cheque. The sworn statement given by the complainant at Sec.200 preliminary enquiry stage is also on the same lines as in the complaint. In the proof affidavit, an entirely new case is made that the petitioner is a guarantor of Ramarishnan in the chit transaction. In cross-examination, PW-1 has clearly admitted that he is not having any direct knowledge about the chit transaction entered into by Ramakrishnan, the subscriber. If that be the admitted position, it would equally flow that PW-1 was not having any direct knowledge as to whether or not the accused was either the relative or guarantor of Ramakrishnan. Reliance has been placed on Ext.P-9 promissory note dated 12.12.2005 to purportedly establish the role of the petitioner as guarantor of the subscriber Ramakrishnan. But a mere perusal of Ext.P-9 promissory note would show that the amount shown therein is Rs.1.45 lakhs whereas the liability alleged in this case is Rs.2,13,258/- as covered by the dishonoured cheque in question. That apart, PW-1 has clearly admitted in cross-examination that Ext.P-9 will ::10:: Crl.R.P.No.245 Of 2017 not show that the said promissory note has been issued in connection with the chit transaction of Ramakrishnan and further that Ext.P-9 will not show that the accused herein is the guarantor of Ramakrishan in the said chit transaction. Further PW-1 has even candidly admitted in his evidence that the signature shown in Ext.P-9 is not that of the accused. Therefore, the entire edifice of the new case built up by the prosecution on the basis of Ext.P-9 promissory note would fall to the ground. Hence, in view of the clear admission of PW-1, any judicial forum would have only the option to come to a considered conclusion that the entire story built up by the complainant is bereft of any credibility or believability. PW-1 would further submit in his evidence that Ext.P-10 ledger produced would show that the petitioner is a guarantor to subscriber Ramakrishnan. In the same breath, PW-1 has conceded in his evidence that Ext.P-10 ledger will not show that the petitioner was the guarantor of Ramakrishnan. PW-1 also condcedes that he does not know whether the accused is related to Ramakrishnan and that the chit agreement and chit proposal have not been produced in this case. PW-1 would further admit that it has not been stated in the complaint as to when Ext.P-2 cheque was issued and executed by the accused to the complainant company. There are no details either in ::11:: Crl.R.P.No.245 Of 2017 the statutory demand notice or in the complaint or in the proof affidavit, etc., as to the date of commencement of the chit transaction. But Ext.P-10 shows that it was for the period from 2005 to 2007. In the light of these well established factual aspects, any reasonable person properly instructed on facts or law would only wonder as to how the accused would voluntarily go forward and execute Ext.P-2 cheque on 4.11.2013 in respect of a chit transaction which was closed as early as in the year 2007. In the light of all these aspects, this Court has no hesitation to hold that the petitioner could effectively and strongly rebut the statutory presumtpion available under Sec.139 of the N.I.Act in the light of the legal principles laid down by various High Courts and the Apex Court. The Apex Court in the case M.S.Narayana Menon alias Mani v. State of Kerala & anr. reported in (2006) 6 SCC 39 = 2006 (3) KLT 404 (SC), has held that onus cast on an accused to rebut statutory presumption under Sec.139 and 118(a) of the N.I. Act is only on the lesser stand based on the preponderance of probability and not on the basis of the heavy standard of proof beyond reasonable doubt. If by preponderance of probability the accused is able to establish the clinching facts and circumstances even from the evidence and pleadings of the complainant, so as to rebut the said statutory ::12:: Crl.R.P.No.245 Of 2017 presumption, courts should carefully consider those aspects as to whether statutory presumption is rebutted or not. It would be profitable to refer to paras 30,32,36 & 38 of the said judgment of the Apex Court which read as follows (see SCC report): "30. Applying the said definitions of 'proved' or 'disproved' to principle behind S.118(a) of the Act, the Court shall presume a negotiable instrument to be for consideration unless and until after considering the matter before it, it either believes that the consideration does not exist or considers the non-existence of the consideration so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that the consideration does not exist. For rebutting such presumption, what is needed is to raise a probable defence. Even for the said purpose, the evidence adduced on behalf of the complainant could be relied upon. xxx xxx xxx 32. The standard of proof evidently is pre-ponderance of probabilities. Inference of pre-ponderance of probabilities can be drawn not only from the materials on records but also by reference to the circumstances upon which he relies. **==> picture [227 x 5] intentionally omitted <==** 36. It was for the Appellant only to discharge initial onus of proof. He was not necessarily required to disprove the prosecution case. Whether in the given facts and circumstances of a case, the initial burden has been discharged by an accused would be a question of fact. It was matter relating to appreciation of evidence. The High Court in its impugned judgment did not point out any error on the part of the appellate court in that behalf. **==> picture [227 x 5] intentionally omitted <==** 38. If for the purpose of a civil litigation, the defendant may not adduce any evidence to discharge the initial burden placed on him, a 'fortiori' even an accused need not enter into the witness box and examine other witnesses in support of his defence. He, it will bear repetition to state, need not disprove the prosecution case in its entirety as has been held by the High Court.” Going by the evidentiary aspects on record, this Court has no hesitation to hold that the petitioner has succeeded to strongly rebut the statutory ::13:: Crl.R.P.No.245 Of 2017 presumption in this case. In such a situation the said statutory presumption has disappeared, heavy burden is cast on the complainant to prove his case relating to the transaction relating to the execution of the cheque, etc. That has not been done by the complainant. Therefore, the only irresistible conclusion is that the accused is entitled for acquittal in the light of the legal principles well settled in that regard. Accordingly, it is ordered that the impugned judgments of both the courts below will stand set aside and the accused is acquitted of the offence under Sec.138 of the N.I.Act and he is set at liberty. 7. It is pointed out by Sri.P.Santharam, learned counsel appearing for the petitioner, that the petitioner has deposited an amount of Rs.50,000/- at the stage of appellate consideration. In the light of this submission, it is ordered that in case the petitioner has deposited any amount before the trial court in relation to this case, then that court shall take immediate steps to release the amount to the petitioner/accused on an application in that regard made by him. With these observations and directions, the Crl.R.P stands finally disposed of. ALEXANDER THOMAS, Judge. bkn/-