RAMESH CHIRUKANDATH HOUSE v. ABOOBACKER AND ANOTHER; STATE OF KERALA

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE V.G.ARUN THURSDAY, THE 20TH DAY OF FEBRUARY 2020 / 1ST PHALGUNA, 1941** ## **CRL.A.No.1452 OF 2010** **AGAINST THE ORDER/JUDGMENT IN ST 1772/2006 OF JUDICIAL MAGISTRATE OF FIRST CLASS -I, PONNANI** **AGAINST THE ORDER/JUDGMENT IN ST 1772/2006 DATED 31-052010 OF JUDICIAL MAGISTRATE OF FIRST CLASS -I, PONNANI** ## **APPELLANT/S:** **RAMESH CHIRUKANDATH HOUSE, (PO) KATTAKAMBAL,, THALAPILLY TALUK.** **BY ADV. SRI.P.K.MOHANAN(PALAKKAD)** ## **RESPONDENT/S:** **1 ABOOBACKER AND ANOTHER ANASSERI HOUSE, VATTAMKULAM AMSOM,, THYCAUD DESOM, PONNANI TALUK,, (PO) VATTAMKULAM, MALAPPURAM DISTRICT - 679 678. 2 STATE OF KERALA REPRESENTED BY PUBLIC PROSECUTOR,, HIGH COURT OF KERALA, ERNAKULAM. R1 BY ADV. SRI.A.KRISHNAN** ## **OTHER PRESENT:** **SR.PP.B.JAYASURYA** **THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 20.02.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** _**Crl.A.1452/10**_ 2 **V.G.ARUN, J. ----------------------------------------------Crl.A.No.1452 of 2010 ----------------------------------------------Dated this the 20[th] day of February, 2020** ## **JUDGMENT** The appellant had filed a complaint against the 1[st] respondent alleging commission of an offence under Section 138 of the Negotiable Instruments Act. The allegations in the complaint were to the following effect; The accused had borrowed an amount of Rs. 3,00,000/- from the complainant. Towards discharge of that amount, the accused had executed and issued Exhibit P1 cheque dated 2.9.2006 drawn on the Canara Bank for Rs.3 lakhs. On presentation, the cheque was returned with the endorsement 'insufficient funds'. Though the complainant issued a statutory notice demanding payment of the amount covered by the cheque, the accused did not repay the amount or send a reply. Hence the complaint. 2. In order to prove his case, the complainant gave evidence as PW1 and marked Exhibits P1 to P5 documents. The accused, who was abroad, answered the questions put to him under Section 313 Cr.P.C through his Counsel and set up a defence that the complaint was filed by misusing one among the three cheques which the accused had _**Crl.A.1452/10**_ 3 entrusted with one Hareesh as security for the amount of Rs.50,000/borrowed from that person. According to the accused, even though he had repaid more than Rs.50,000/- to Hareesh, the cheques were not returned and instead, Hareesh filed a civil suit on the strength of one of the cheques before the Munsiff's Court, Ponnani and the accused was forced to remit Rs.1,25,000/- to clear that liability. The complainant is a close friend of Hareesh and it is by misusing one of the cheques entrusted with Hareesh that the instant complaint is filed. The accused also set up a defence that, at the time when the transaction is alleged to have taken place, the accused was abroad, which fact could be proved by production of his passport. The capacity of the complainant to raise an amount of Rs.3,00,000/- was also challenged and DW1 was examined to prove that fact. 3. The trial court, on appreciation of evidence and on consideration of the rival contentions, acquitted the accused finding that the complainant had failed to prove due execution of the cheque by the accused. This was primarily for the reason that, except the signature, no other entry in Exhibit P1 cheque was that of the accused. Even though DW1 supported the complainant's version of having raised amounts from the kuries conducted by him, the trial court disbelieved the evidence of DW1 and held that even if the evidence of DW1 is accepted, it proved receipt of only Rs. 40000/- by the _**Crl.A.1452/10**_ 4 complainant and that in the absence of proof as to how the complainant had raised the balance amount of the Rs.3,00,000/advanced to the accused, the defence version seems more probable. 4. Assailing the findings in the judgment, the learned counsel for the appellant submits that the trial court had completely misappreciated the evidence and misunderstood the legal position. It is contended that the accused having admitted his signature in the cheque and having failed to issue a reply to the demand notice, the trial court ought to have found that the presumption under Section 139 of the Negotiable Instruments Act was attracted. Regarding the capacity of the complainant to raise the amount advanced to the accused, the learned counsel for the appellant would submit that the presumption under Section 118(a) of N.I. Act was not properly considered by the trial court. The evidence tendered was sufficient to prove execution of the cheque, as also the financial capacity of the complainant, is the submission. Strong exception is taken against the assumptions of the trial court, of the accused being abroad when the transaction took place and of the possibility of the cheque entrusted with Hareesh having been misused. 5. The learned counsel for the respondent supported the findings in the impugned judgment and contended that the complainant having failed to discharge the initial burden of proving the ingredients _**Crl.A.1452/10**_ 5 necessary to attract the offence under Section 138, the trial court was fully justified in holding that the presumption under Section 139 was not attracted. It is contended that being an appeal against acquittal, even if this Court finds that a different view from that of the trial court is possible, that would not justify interference with the trial court judgment. 6. On appreciation of the evidence the following facts emerge; The signature of the accused in Exhibit P1 cheque is not disputed. The accused did not issue a reply notice, when called upon to pay the amount covered by the cheque. It was only during the cross examination of PW1 that a suggestion was made of the cheque entrusted with Hareesh having been misused. The evidence of PW1 would show that he was honest enough to state that he had acquaintance with Hareesh and that he was also aware of the case filed by Hareesh against the accused. PW1 goes on to say that the accused had taken loan from him on the strength of cheques given as security on previous occasions also. Even though the accused stated that he was abroad when the alleged transaction took place, no effort was made to prove the contention. 7. A mere suggestion made to PW1 during cross examination regarding his acquaintance with Hareesh and of the complaint having been filed based on a cheque procured from Hareesh is not sufficient _**Crl.A.1452/10**_ 6 to arrive at the conclusion that there was no transaction between the complainant and the accused. In order to prove that the complainant did not have the financial capacity to advance an amount of Rs.3,00,000/- and for disproving the case of the complainant that he had raised the amount of Rs.3,00,000/- from different Kuries he had subscribed, DW1 was examined on the defence side. But DW1 categorically stated that the complainant was a subscriber of the Kuri conducted by him and that the complainant had advanced the amounts received from the Kuries to the accused. The trial court committed a mistake in disbelieving the version of DW1 on the premise that he was won over by the complainant. The mere fact that DW1 had contacted the complainant after receipt of summons will not lead to the conclusion that he was won over by the complainant. The further finding that even going by the evidence of DW1, the complainant could prove receipt of only Rs.40,000/- from the Kuri and could not prove as to how he had raised an amount of Rs.3,00,000/-, ought to have been considered in the backdrop of the presumption under Section 118(a) of the N.I.Act. As per Section 118(a), until the contrary is proved, it is to be presumed that every negotiable instrument was made or drawn for consideration. Therefore, the burden to prove that Exhibit P1 cheque was drawn without consideration was squarely upon the accused and not the complainant. _**Crl.A.1452/10**_ 7 8. The trial court found that, the accused having raised a plea of Exhibit P1 being a blank signed cheque, burden was upon the complainant to prove that the accused had executed the cheque. It was found that the evidence of the complainant did not indicate of the accused having executed the cheque in the presence of the complainant and mere putting of signature cannot be termed as execution of the cheque. It was held that simply because a cheque was found in the possession of the complainant, it is not sufficient to draw the presumption under Section 139 of the N.I.Act and that the benefit of presumption available under Sections 139 and 118(a) can be drawn only if the execution is proved. The consistent case of the complainant is that the accused had executed and entrusted the cheque with him. During his cross examination, the complainant stated that the accused had brought a cheque containing necessary entries and had signed the cheque in his presence. The legal position with respect to signed blank cheques was considered by the Honourable Supreme Court in _**Bir Singh v. Mukesh Kumar**_ [(2019) 4 SCC 197]. After a detailed survey of precedents, the Apex Court found that a meaningful reading of the provisions of the Negotiable Instruments Act including, in particular, Sections 20, 87 and 139 makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption of the cheque having been _**Crl.A.1452/10**_ 8 issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. It was specifically found that if a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars, which by itself would not invalidate the cheque. The onus will be on the accused to prove that the cheque was not in discharge of a debt or liability. 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. In _**T.P.Murugan v. Bojan**_ [2018 8 SCC 469], the Honourable Supreme Court held that, rebuttal of the presumption under Section 139 must be by adducing credible evidence and mere raising of a doubt sans cogent evidence, with respect to the circumstances, is not sufficient to discharge the presumption. In the instant case, no effort was made by the accused to bring in evidence, let alone any cogent evidence, to show that the cheque was not issued in discharge of a debt. In such circumstances, the finding of the trial court, of Section 139 not being attracted, since the entries in the cheque were made by some person other than the accused, is unsustainable. _**Crl.A.1452/10**_ 9 9. The other contention is that the appellate court should be circumspect in interfering with an appeal against acquittal. In this regard it may be pertinent to note the following observation of the Honourable Supreme Court in _**M.Abbas Haji v. T.N.Channakeshava**_ (Crl.Appeal No.664 of 2012); “Proceedings under Section 138 of the N.I.Act are quasi-criminal proceedings. The principles which apply to acquittal in other criminal cases cannot apply to these cases.” 10. I find substantial force in the contention of the learned counsel for the appellant that the impugned judgment was rendered by the trial court on the basis of surmises and conjunctures. It is pertinent to note that except a vague statement that, at the time when the transaction took place, the accused was abroad, there was nothing before the trial court to prove that fact, in spite of which the trial court entered a finding that the accused was in gulf _(sic)_ on the date of alleged transaction. 11. The reasons which prompted the trial court to acquit the accused having found to be unsustainable, I set aside the impugned judgment, finding the evidence tendered to be sufficient to hold the accused guilty of the offence under Section 138 of the Negotiable Instruments Act. Consequently the accused is convicted for the offence under Section 138 of the Negotiable Instruments Act. Keeping in mind the fact that the transaction is of the year 2006, the sentence of _**Crl.A.1452/10**_ 10 imprisonment is confined to imprisonment till rising of the court. In addition to the sentence, the accused is directed to pay compensation of Rs.3,50,000/- (Rupees Three Lakh Fifty Thousand only) to the complainant, under Section 357(3) Cr.P.C. If the compensation is not paid within three months, the accused shall be liable to undergo simple imprisonment for a period of three months. Sd/- **V.G.ARUN, JUDGE** _vgs_