Ranjini Ramaswamy v. Joshy George & State of Kerala

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE SUNIL THOMAS** **FRIDAY, THE 25TH DAY OF OCTOBER 2019 / 3RD KARTHIKA, 1941** ## **CRL.A.No.187 OF 2008** **AGAINST THE ORDER/JUDGMENT IN CC 734/2002 DATED 24-05-2007 OF CHIEF JUDL.MAGISTRATE, ERNAKULAM.THE ORDER/JUDGMENT IN CRL.L.P. 528/2007 DATED 11/10/2007)** ## **APPELLANT/COMPLAINANT:** **RANJINI RAMASWAMY W/O T.S.RAMASWAMY, 20/943, SURYARAMAM, MAIN ROAD, THRIPPUNITHURA.** **BY ADVS. RANJINI RAMASWAMY(PARTY) SRI.R.SANJITH SMT.C.S.SINDHU KRISHNAH** ## **RESPONDENT/S:** **1 JOSHY GEORGE S/O K.C.GEORGE, KOCHUMALAYIL HOUSE, ANGADYKADAVU P.O., IRITTY, KANNUR DISTRICT. 2 STATE OF KERALA REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA,, ERNAKULAM.** **R1 BY ADV. SRI.K.S.RAJESH R1 BY ADV. SRI.M.SHAJU PURUSHOTHAMAN** ## **OTHER PRESENT:** ## **SR.PP. SRI SANTHOSH PETER** **THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 16-10-2019, THE COURT ON 25-10-2019 DELIVERED THE FOLLOWING:** Crl.Appeal No.187/2008 2 ## **JUDGMENT** The complainant in CC No.734/2002 of the Judicial Magistrate Ernakulam, aggrieved by the dismissal of his complaint filed under section 138 of the Negotiable Instruments Act, has approached this Court. 2. The case set up by the complainant before the court below was that he had entered into an agreement with the accused on 19/3/2001 in relation to the conferring of World Negative Rights of a film produced by the accused. Rupees Ten Lakhs was agreed to be paid. Rs.5 Lakhs was paid on the same day. Balance of Rs. 5 Lakhs was paid in installments, apart from few other payments. Due to some disputes, the film could not be released and hence, towards the discharge of the liability due to the complainant, the accused delivered a cheque for a sum of Rs. 9 Lakhs on 11/2/2002. It was presented for collection and was returned dishonoured on 21/1/2002. A statutory notice was issued which was received by the accused on 27/3/2002. After the completion of the statutory period, complaint was laid on 26/3/2002. Thereafter, a reply dated 4/4/2002 was received. 3. The accused appeared before the court below and demanded trial. On the side of the complainant, she was examined as PW1 and her husband was examined as PW2. Crl.Appeal No.187/2008 3 Exts.P1 to P7 were marked. On the side of the accused, he got himself examined as DW1. The court below, after hearing both sides and evaluating the evidence, dismissed the complaint, which is assailed in this appeal. 4. Heard the learned counsel for the appellant and the learned counsel for the respondent. 5. The complaint was dismissed by the court below essentially on the ground that the complainant failed to prove that Ex.p1 cheque was issued towards discharge of a legally enforceable debt. It was held that, PW1 in her evidence had stated that an agreement was entered into between the complainant and the accused, pursuant to which amounts were paid. Towards discharge of the liability that arose, the cheque for Rs.9 Lakhs was handed over along with the letter. The court below held that since the accused had stoutly denied the execution of Ext.P1 cheque towards any existing liability, non production of the agreement and the letter allegedly given along with the cheque were fatal to the complainant's case. It was held that according to PW1, at the time of handing over of the money, one witness was present who was not examined. It was also held that at the time of evidence, PW -1 deposed that accused had transaction with her husband PW2 also. Further, the version regarding the Crl.Appeal No.187/2008 4 payments as spoken by PW1 and PW2, were inconsistent to each other. It was also pointed out by the court below that in Ext.P7 reply, the accused had denied the execution of cheque and narrated the details of transaction with the complainant. Hence, the complainant was under an obligation to produce the agreement supporting the transaction . The court further held that non production of the above document entails drawing of adverse inference that, had the agreement been produced it would have disproved the case set up by the complainant. The court held that PW1 in her evidence deviated from the complaint and stated that the husband might have given money to the accused. 6. Learned counsel for the complainant attacked the above conclusion and contended that PWs 1 and 2 have given consistent version through out their evidence. Major part of the transaction stood established, it was contended. It was also contended that the accused had substantially given evidence touching upon the transaction and the limited defence set up by the accused was inconsistent. Hence, it was contended by the learned counsel that the court went wrong in appreciation of evidence. 7. The facts that the cheque was drawn on the account of the accused, that it was presented in the bank, that it was Crl.Appeal No.187/2008 5 returned dishonoured on the ground of insufficiency of fund and that the complaint was laid in strict compliance with the statutory formalities are not in dispute. It is also not in dispute that the disputed cheque bears the signature of the accused. Essentially it has been noted that the complainant let in evidence in the form of oral testimony of PW1 and PW2 and relied on the documentary evidence. On the other hand, the accused got himself examined as DW1. The learned counsel for the accused relied on the decisions reported in **Padmanabhan v. Vasudevan Namboodiri (2010 (3) KLT 216)** and **Basalingappa v. Mudibasappa (2019 (2) KHC 451(SC)** and contended that the presumptions under section `139 of the NI Act can be drawn only if there is proof of clear execution of the cheque. It was further contended that, in the case at hand. the complainant thoroughly failed to prima facie establish the due execution of the cheque towards the discharge of legally enforceable debt. It emerges that since both sides have let in evidence, the significance of presumption under section 139 of the NI Act pales into insignificance and it is essentially a question of appreciation of evidence. 8. It was contended by the learned counsel for the complainant that PW1 and PW2 have succeeded in Crl.Appeal No.187/2008 6 establishing the prima facie case set up by the complainant and that the court below failed to notice that the accused had set up a thoroughly inconsistent defence. It was also contended that the court below essentially picked up few loop holes in the evidence of PW1 and PW2 and dismissed the complaint. It was contended that rather than appreciating the available evidence, and considering whether the complainant had succeeded in proving the prosecution case beyond reasonable doubt, the court proceeded to pick up and choose loopholes in the prosecution evidence and ultimately arrived at wrong conclusion. 9. Negativing the above contentions, learned counsel for the accused contended that even assuming that complainant had set up inconsistent defence, that does not enure to the benefit of the complainant and it does not relieve him of his obligation to prove beyond reasonable doubt, the fundamental facts constituting his allegation. To substantiate the contention that the accused is entitled to take inconsistent defence, learned counsel relied on the decision in **Geetha v. Aliyarkunju(1993 (3) KLT Case No.29),** wherein the court held that the Law permits inconsistent or alternative defences. Learned counsel further relied on the decision reported in **Kali Ram v. State of Himachal** Crl.Appeal No.187/2008 7 ## **Pradesh(1973) 2 Supreme Court Cases 808),** wherein it was held that the burden of prima facie proving the guilt of the accused was on the prosecution and unless it relieves itself of that burden, the court cannot record a finding of the guilt of the accused. It was held that there are certain cases in which statutory presumptions arise regarding the guilt of the accused, but the burden even in those cases is upon the prosecution to prove the existence of the fundamental facts which have to be established before the presumption can be drawn. Once these facts are proved by the prosecution, the court can raise the statutory presumption. In Basalingappa's case (cited supra) also, the Hon'ble Supreme Court relied on Kali Ram's case(supra) on the question of foundation al facts to be established by the prosecution. 10. There is no doubt that primariy burden is on the complainant to establish the basic facts. However, the trend of the evaluation of the evidence done by the court below shows that the court was searching for loopholes in the prosecution case, rather than appreciating the available evidence in its correct perspective to find out whether the complainant had succeeded in proving his case. As PW1, the complainant has tendered evidence in accordance with the prosecution case. She deposed that there was a transaction Crl.Appeal No.187/2008 8 regarding the purchase of right of film and an agreement was entered into. It was pursuant to that, the amount was advanced by her in instalments. According to her, agreement was produced before a court at Aluva. The court below found fault with the complainant for not having produced the original agreement as well as the letter stated to have been given along with the cheque. It is true that an agreement was entered into between the parties. It was subsequent to that agreement that the amount was paid in installments. PW1 in her evidence has stated that the original agreement was produced before the court. 11. The learned counsel for the accused relying on the decision reported in **Kundan Lal Rallaram v. Custodian, Evacuee property(AIR 1961 Supreme Court 1316)** contended that if the basic document, based on which the transaction is set up is not produced, an adverse inference can be drawn by the court that, had the document been produced by the party, it would have gone against that party. In Kundan Lal's case(Supra), the case set up by the complainant was that money was due to him in the sale of certain goods to the accused. He deposed that he was in possession of the accounts books which evidenced the sale. However, the documents were not produced . The Hon'ble Crl.Appeal No.187/2008 9 Supreme Court held that if such a relevant evidence is withheld by the plaintiff, Section 114 of the Evidence Act enables the Court to draw a presumption to the effect that, if produced, the said account would be unfavourable to the plaintiff. However, in the case at hand, it seems that there was an agreement and it was pursuant to that agreement the money was given. Evidently, the cheque was given much later. Hence, the entire transaction, issuance of cheque, subsequent payments and non return of the amount will not be evidenced by the agreement. Above all, the accused in his reply dated 4/4/2002, produced as Ext.P7, had clarified that he had entered into an agreement with the complainant to sell the Rights. The payment schedule was also mentioned. The terms and conditions of the sale was also reiterated in the reply notice. Having admitted substantially the transactions between the accused and the complainant in relation to the production of a film and the execution of an agreement accused cannot be heard to contend that the agreement, was not produced. A perusal of the defence set up by the accused in his reply notice, answers to section 313 Cr.P.C. questioning, as well as the trend of the cross examination indicate that he has admitted the receipt of money from the complainant for the production of the film. Crl.Appeal No.187/2008 10 There is no substantial divergence between the accused and the complainant regarding the essential facts of the basic transaction. Further, the cheque being a negotiable instrument with its inherent statutory presumptions, I am of the view that, it can independently be relied on by the complainant to prove the transaction. Hence, the finding of the court below that the non production of the agreement was fatal to the case of complainant, is only to be negatived. 12. Another finding of the court below was that, at the time of handing over of he money, few witness were present who were not examined. The money transaction between the parties is not in dispute. The essential question is whether the cheque was issued towards the discharge of the amounts due. Even in the reply notice, the accused had gone to the extent of saying that he had borrowed Rs. 3 Lakhs for the purpose of producing the film. It is also seen from the evidence of PW1 and PW2 that at the time of handing over of the first payment, few persons were present. All of them were the acquaintances of the accused. Hence, the complainant cannot be found fault with for not having examined them. 13. Yet another reason projected by the court below was regarding the payment, PW1 and PW2 had set up Crl.Appeal No.187/2008 11 inconsistent versions, it was held. It was also contended by the learned counsel for the accused that, the complainant had no source of income and she in her evidence had stated that she was only assisting her husband in his office and was not drawing any salary. It was further contended by the learned counsel for the accused that even though PW1 claimed that she had transaction with the accused, in the course of examination she had admitted that a sum of Rs. 5 Lakhs was paid by the husband. 14. In fact, the contention of the accused that the complainant had no capacity to pay the money, cannot be accepted even for a moment, since in Ext.P7 reply notice, in answer to the notice sent by the complainant herein, the accused has categorically admitted that he had borrowed Rs. 3 Lakhs from the complainant for the purpose of producing the film. It is also pertinent to note that PW1 in her evidence has stated that she was assisting the husband. She also stated that one instalment was paid by the husband. But, in answer to a question whether she had paid the money to the accused directly, her reply was that the husband and herself together had given the payment. She had stated that she herself had made certain payments and her husband had paid certain payments. But she added that the transaction was Crl.Appeal No.187/2008 12 with herself. This is admitted by the accused in Ext.P7 reply notice also. The court below, without considering these facts, proceeded to hold that the complainant did not have a consistent case. 15. Eschewing all the minor inconsistencies, a thorough evaluation of evidences of PW1 and PW2 in the background of the defence set up by the accused, clearly shows that the version set up by PW1 and PW2 establishes the substratum of their case. In this regard, absolutely inconsistent and self contradictory defence set up by the accused cannot be ignored. In the reply notice he had specifically stated that he had borrowed Rs.3 Lakhs from the complainant for producing the film. Thereafter, he admitted that he had discussion with the complainant and it was agreed that negatives of the film produced by him will be sold to the complainant. Payment schedule was also admitted. He further admitted that he had given a blank signed cheque to the complainant while borrowing Rs. 3 Lakhs. However, the trend of cross examination indicates that case set up at that time was that the transaction was with the husband. In the reply notice his case was that, a blank signed cheque was handed over to the complainant. In the questioning under section 313 Cr.P.C., his contention was that he had Crl.Appeal No.187/2008 13 transaction with the husband of the complainant and he assigned the rights of the film to the husband. He had also handed over the cheque and a paper to the husband of the complainant which was misused. When the accused entered the box and deposed as DW1, he further varied from the original defence and deposed that though the transaction was with the husband who had advanced more than Rs. 9 Lakhs, he had no transaction with the complainant. He had set up a defence that, as a security he had given a blank paper and cheque. 16. A perusal of the above shows that the accused had a thoroughly inconsistent defence. Substantially, he admitted that he had transaction with the complainant/ husband and had received money from her totaling to around Rs. 9 Lakhs. He has no specific case that it has been repaid by him. Absolutely, no evidence is forthcoming to substantiate it. 17. On an overall evaluation, I feel that complainant has succeeded in establishing her case. Findings arrived at by the court below appears to be on the basis of wrong appreciation of facts and wrong application of law. The judgment of court below is hence liable to be set aside. Necessarily this leads to the sentence to be imposed on the accused. Having evaluated the entire facts, I am inclined to Crl.Appeal No.187/2008 14 allow the appeal. Accordingly, the appeal is allowed. The judgment of the court below is set aside and the accused is found to be guilty of the offence punishable under section 138 of the NI Act. He is sentenced to undergo imprisonment till the rising of the court and to pay a fine of Rs.10 Lakhs and in default, to undergo SI for six months. If the fine is paid, a sum of Rs 9,50,000/-(Rupees Nine Lakhs fifty thousand only) shall be paid to the complainant as compensation. The accused shall appear before the court below within two months from today to undergo the sentence. **Sd/-** dpk **SUNIL THOMAS JUDGE**