Renu Ninan v. Shifa Hire Purchase Ltd and State

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MRS. JUSTICE M.R.ANITHA** **THURSDAY, THE 09TH DAY OF JULY 2020 / 18TH ASHADHA, 1942** ## **Crl.Rev.Pet.No.3918 OF 2010** **CRA 364/2009 OF ADDITIONAL DISTRICT AND SESSIONS COURT, FAST TRACK (ADHOC), MAVELIKKARA** **CC 361/2005 OF JUDICIAL MAGISTRATE OF FIRST CLASS -I, MAVELIKKARA** ## **REVISION PETITIONER/APPELLANT/ACCUSED** **RENU NINAN, VADAKKETHALACKAL, THAZHAKKARA P.O., MAVELIKKARA.** **BY ADV. SRI.A.SHAFEEK (KAYAMKULAM)** ## **RESPONDENTS/RESPONDENTS/COMPLAINANT & STATE** **1 M/S. SHIFA HIRE PURCHASE LTD PUTHIYAKAVU, REPRESENTED BY ITS RECOVERY OFFICER, SURESH KUMAR,, PIN - 690 102. 2 STATE OF KERALA REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA,, ERNAKULAM. R1 BY ADV. SRI.B.BIPIN R1 BY ADV. SRI.S.MOHANAN R1 BY ADV. SRI.R.REJI** ## **OTHER PRESENT:** **SRI.BREEZE,PP** **THIS CRIMINAL REVISION PETITION HAVING BEEN FINALLY HEARD ON 1.7.2020, THE COURT ON 09.07.2020, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** Crl.R.P.3918/2010 2 ## **ORDER** ## **Dated : 9[th] July, 2020** 1. This Criminal Revision Petition has been filed against the concurrent finding of guilt, conviction and sentence passed against the revision petitioner. 2. The revision petitioner is the accused in a case taken on file by the court below based on a private complaint filed under Sec.142 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the Act). Parties would be hereinafter be referred as per the status before the court below. 3. The complainant's case in short is as follows : The complainant is a company engaged in the business of giving financial assistance for various business purposes. The company has been represented by the recovery officer who is authorized by the managing director of the company. Accused availed a loan from the company and he committed default in making the re-payment and hence complainant Crl.R.P.3918/2010 3 repaid the loan with full arrears. In discharge of the debt the accused issued cheque No.SPU-749664 dated 5.5.2004 drawn on the State Bank of Travancore, AD branch, Mavelikkara and the cheque was delivered at the office of the complainant at Puthiyakavu, Mavelikkara. On presentation of the cheque through the Federal bank, Mavelikkara brach, it was returned on 6.5.2004 for the reason of insufficiency of funds. Thereafter, complainant issued a registered lawyer notice dated 15.5.2004 demanding the amount and intimating the dishonour of the cheque. Though the accused accepted the notice on 19.5.2004, he did not pay the amount. Hence the complaint has been filed. 4. PW1 was examined and Exts.P1 to P7 were marked on the side of the complainant. After the closure of complainant's evidence, the accused was questioned under Sec.313 Cr.P.C. She denied all the incriminating facts and circumstances put to her and filed an additional statement denying the execution of the cheque by her and further that her husband had a Crl.R.P.3918/2010 4 transaction with the complainant/company and as an additional security towards that transaction, a signed blank cheque of the accused was obtained by the managing director of the company from her husband. The transaction between the company and her husband was closed long back and the complaint has been filed misusing the blank signed cheque obtained from her. Thereafter on hearing both sides, the court below found the accused guilty under Sec.138 of the N.I.Act and sentenced her to undergo imprisonment till the rising of the court and further directed to pay compensation of Rs.2,50,000/- under Sec.357 (3) Cr.P.C in default to undergo simple imprisonment for three months. Against which Crl.Appeal 364/2009 was filed and the Additional District and Sessions Court, Fast Track (Ad-hoc), Mavelikkara as per the judgment dated 8.9.2010, dismissed the appeal. Aggrieved by the same, the revision petitioner/accused came up in revision for the various grounds stated in the memorandum of revision. Crl.R.P.3918/2010 5 5. Notice was issued to the respondents. First respondent appeared through counsel and the second respondent appeared through Public Prosecutor. Lower court records were called for and perused. Heard both sides. 6. The main contention of the learned counsel for the accused is that PW1 the recovery officer is not an authorised officer competent to represent the complainant/company and hence the complaint filed by him is not maintainable in law on that ground itself. Further he would contend that the husband of the accused had got some financial transaction with the complainant/company and she had not availed any amount from the complainant company. In the transaction between her husband and the company, her signed blank cheque was obtained by the company and in spite of the fact that the transaction between the company and her husband has already been closed, misusing the blank signed cheque obtained from her, this complaint has been filed. So he would contend that the accused could rebut the presumption under Crl.R.P.3918/2010 6 Sec.139 and 118 of the N.I.Act and without appreciating that fact, both the courts below found the accused guilty and hence it has to be interfered with. 7. With regard to the authority of PW1, the recovery officer, the learned counsel for the accused took my attention to clause 70 of Ext.P2 which is the Memorandum of Association and Articles of Association of complainant company. For making it clear para 70 is extracted below : Powers of Managing Director : Subject to the provisions of the Act and to the general supervision and control of the Board, the Managing Director shall have the General Management and superintendence of the business of the company with power to do acts, matters and things deemed necessary, proper or expedient for carrying on the business and concerns of the Company, including power to appoint, suspend and dismiss officers, staff and workmen of the company, to make and sign all contracts, and receipts and to draw, accept, endorse and negotiate on behalf of the Company all such bills of exchange, promissory notes, Crl.R.P.3918/2010 7 hundies, cheques, drafts, Government promissory notes, or other Government papers and other instruments as shall be necessary, proper of or expedient for carrying on the business of the Company and to operate the bank accounts of the Company and to represent the Company in all suits and other legal proceedings, to engage solicitors, advocates, and other agents and sign the necessary papers, documents and instruments of authority and generally to exercise all such powers and authorities of the company as are noted by the Companies Act for the time being in force or by these Articles, expressly directed to be exercised by the Board of Directors or by the Company in General Meeting. 8. So on a mere glance through para 70, it could be seen that managing director is empowered to engage agents to represent the company in all suits and other legal proceedings. As per Ext.P1, the managing director of complainant company has authorised PW1 who filed the complaint against the accused and prosecute her and Crl.R.P.3918/2010 8 represent the company before the Judicial Magistrate of First Class Court, Mavelikkara. So clause 70 of Ext.P2 would estop the accused from contending that PW1 is not an authorised officer to represent the company. So the contention to the contra advanced by the learned counsel is not sustainable either in law or on facts. 9. The other argument of the learned counsel is that the accused has no transaction with the complainant company and her husband had transaction with the company previously and that has been closed long back. In this context the learned counsel for the accused would take my attention to the averments in the complaint in para 2, wherein complainant has alleged that the accused availed a loan from the company and since he committed default complainant recalled the loan with full arrears. The learned counsel would also contend that, that portion has been subsequently attempted to be amended by the complainant by filing C.M.P.3724/2006 and though that was allowed as per the Crl.R.P.3918/2010 9 order dated 29.4.2006 by the learned magistrate, the accused took up the matter before this court and as per the judgment in W.P.(C).18211/2006 dated 16.10.2008, this court set aside the said order passed by the learned magistrate and the case was remitted to the learned magistrate for fresh disposal taking into account the contention raised by both sides. It is true that subsequently no action seen taken by either side with respect to C.M.P.3724/2006. But in the chief affidavit filed by the complainant, the complainant has categorically sworn in that the husband of the accused in order to purchase computer and UPS, availed loan from the complainant and he committed default in repayment of the amount. Hence he was informed to clear the debts and accordingly he came to the company and agreed to clear debt within two days. Thereafter he came to the company along with the wife, accused herein, and the accused undertook to discharge the debt due to the husband and issued Ext.P1 cheque dated 5.5.2004 in favour of the Crl.R.P.3918/2010 10 complainant. So even though there is no averments in the complaint that the transaction was between the husband of the accused and the complainant, in the chief affidavit a detailed narration of the transaction of her husband with the company had been stated. It is also sworn in that the accused undertook to discharge the liability of her husband and issued the cheque. Hence it cannot be found that there was suppression or contradiction in the case put forward by the complainant. It is also to be noted that though attempt was made by the complainant once to rectify that mistake, subsequently no follow up action seen taken by the complainant after setting aside the order in C.M.P. 3724/2006 by this court. The accused also did not dispute the fact that her husband had a transaction with the complainant company and she would admit signature in the cheque and her defence is that it was a blank signed cheque issued as a security in the transaction of her husband and the company. But apart from her statement, during examination, under Crl.R.P.3918/2010 11 Sec.313 and suggestion put to PW1 during crossexamination, there is no evidence to substantiate the entrustment of blank signed cheque by her in the transaction of her husband. The statement of the accused under Sec.313 Cr.P.C or the suggestion made to PW1 during crossexamination, will not constitute evidence. In this context, it is relevant to quote **Sulochana Devi v. Baburaj V. and another (2016 (1) KHC 134)** wherein it has been held that mere suggestion in cross-examination can only be indicative of the case put forth and the stand taken by a party on whose behalf the cross-examination was being conducted and the suggestion was put. But it cannot substitute for evidence when once the suggestion was repudiated by the witness to whom it was made. In this case the suggestion made to PW1 that the husband of the accused had transaction with the managing director and as additional security, the signed blank cheque of the accused was obtained, was denied by him. Further suggestion that the cheque so obtained was Crl.R.P.3918/2010 12 misused is also denied by him. So the contention of the accused that Ext.P3 is the blank signed cheque entrusted by her to the managing director as an additional security in the transaction of her husband is not substantiated. 10. On the other hand, PW1 has filed chief affidavit with respect to the transaction of the husband of the accused with the company, the default committed by him in repaying the amount, subsequent demand of the amount with him and thereafter accused along with her husband came to the office of the company and on undertaking to discharge the debt, accused issued Ext.P3 cheque. During cross-examination he also asserted that the cheque was signed in front of him by the accused and it was brought in writing by her. So the factum of issue of Ext.P3 cheque by the accused in favour of the complainant is proved by the evidence of PW1. In this context it is relevant to quote **Bhaskaran A.K. v. K.G.Sheeba and another (ILR 2020 (1) Kerala 293)** wherein while dealing with Sec.138 of the N.I.Act and debt or liabilities Crl.R.P.3918/2010 13 stated therein , it has been held that any “debt or other liabilities” under Sec.138 does not insist that the cheque should be issued in discharge of drawer's liability alone and further that the cheque would be in discharge of any debt or liability including the cheque of a guarantor. Here the accused the wife of the borrower, issued the cheque in discharge of the liability of her husband. It will come well within the definition of any debt or other liabilities described under Sec.138 of the N.I.Act. So once the fact of issue of cheque and execution is proved, the presumption under Sec.139 and 118 of the N.I.Act would come to the rescue of the complainant. The burden is upon the accused to rebut the presumption (Devan v. Krishna Menon(2010 (2) KLT 397) and Hamsa Mussaliar v. Hamza Khan & anr. (2014 (4) KLT 883 **).** 11. In this case the case put forward by the accused is one of entrustment of blank signed cheque as an additional security in the transaction of her husband with the complainant company. In this context it is relevant to quote Crl.R.P.3918/2010 14 **Bir Singh v. Mukesh Kumar (2019 (1) KHC 774 sc)** wherein while dealing with Sec.139 of the N.I.Act it has been held that a blank cheque voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under Sec.139, in the absence of any cogent evidence to show that cheque was not issued in discharge of a debt. Mere filling up of cheque by the payee would not invalidate the cheque and it does not amount to alteration. It is also held that the onus of proving that the cheque was not in discharge of any debt or other liability is on the accused, drawer of the cheque. 12. The learned counsel for the accused also took my attention to **ANSS Rajashekar v. Augustus Jeba Ananth (2019 (2) KHC 155)** wherein while dealing with Sec.138 and 139 of the Act it has been held that when presumption under Sec.139 is rebutted by the accused and defence case to probabilise, the trial court was not justified in convicting the accused. But on going through the facts of that case, it is Crl.R.P.3918/2010 15 seen that the trial court convicted and sentenced the accused under Sec.138 and the appellate court on appreciating that, during cross-examination of the accused, the complainant stated that the accused demanded a loan of Rs.15,00,000 and at that time the complainant had only paid an amount of Rs.5,00,000/- as loan for which accused issued Ext.P1. This suggestion was denied by the accused and the appellate court observed that where the complainant furnished a loan of Rs.15,00,000/- to the accused as stated in the complaint or whether complainant had paid Rs.20,00,000/- as mentioned in the legal notice dated 10.8.2004 or whether he had paid an amount of Rs.5,00,000/- as suggested during the crossexamination was a matter of serious doubt and it is also stated that if the complainant had paid Rs.15,00,000/- the suggestion during cross-examination of having paid an amount of Rs.5,00,000/- cast serious doubts on the existence of a debt in the first place and the complainant also admitted that he had not mentioned anything about the accused Crl.R.P.3918/2010 16 having issued two cheques in the complaint and nothing was also stated about the fate of earlier two cheques which alleged to have been issued by the accused. So on a totality of the facts and circumstances, the appellate court held that presumption under Sec.139 of the Act stood rebutted. So what could be gathered from the fact situation of that case is that the complainant did not have any consistent case with regard to the amount actually availed and different amount has been given in the complaint and in the legal notice. Taking all those factors into account it was held that the accused was able to rebut the presumption under Sec.139. But here there is no such scenario. A consistent case has been put forward by the complainant right from the beginning with regard to the amount due and the cheque issued. The only discrepancy is that in the complaint it has not been specifically alleged that the transaction with the company was actually by the husband of the complainant. So the fact situation of that case is not applicable to the case in hand. Crl.R.P.3918/2010 17 13. The learned counsel also took my attention to **Joshy P.G. v. Jose Varghese and another (2019 (4) KHC 753)** wherein it has been held that the accused was able to rebut the presumption under Sec.139 by relying upon the case set out by the complainant. The absence of material in the complaint and also the evidence adduced by the complainant, accused has a right to keep silence by not entering into the witness box. But that was a case in which trial court acquitted the accused on finding that there are suspicious circumstances regarding the execution of the cheque by the accused and issuing it by him to the complainant in discharge of debt. In that case, DW1 was examined and Exts.D3 and D4 documents were marked. The contention of the counsel for the complainant was that the evidence of DW1 is not reliable and Exts.D3 and D4 documents cannot be acted upon and that the evidence adduced by the accused would not enable him to rebut the presumption under Sec.139 of the Act. But the accused has Crl.R.P.3918/2010 18 got a specific defence in that case that complainant trespassed into the shop and forcefully took two cheques and compelled him to sign the cheque leafs and he also filed complaint in connection with that incident. The court entered into a finding that if the evidence of DW1 is accepted as believable, in the absence of Exts.D3 and D4 complaint, the plea of accused would stand proved. In the said circumstances, it was held that in the absence of any reliable evidence adduced to prove the transaction alleged, he failed to prove the commission of offence under Sec.138 of the N.I.Act by the accused. But in this case, apart from the statements of the accused during her examination and the suggestion put to PW1, there is no evidence whatsoever to probabilise the case of the accused that Ext.P3 was a blank cheque issued by her as an additional security in the transaction of her husband with the complainant company. So the fact situation of this case is also quite different from the decision cited above. Crl.R.P.3918/2010 19 14. Here the accused failed to rebut the presumption that is available in favour of the complainant under Sec.139 and 118 of the Act. The evidence of PW1 would convincingly establish that Ext.P3 cheque has been issued in discharge of a legally enforceable debt by the accused in favour of the complainant. Ext.P7 is hypothecation agreement and promissory note executed by the husband of the accused with the complainant company while availing the amount of Rs.2,51,600/- which would prove the original transaction between the husband of the accused and complainant company. 15. On an anxious evaluation of facts and circumstances and the evidence adduced, I am of the considered view that both the courts below appreciated the facts and circumstances and the evidence adduced in a correct perspective. There is no illegality or impropriety in the findings of guilt against the accused calling for an interference at the instance of this court. Crl.R.P.3918/2010 20 16. In the result, revision petition dismissed confirming the conviction and modifying the sentence directing the accused to pay fine of Rs.2,50,000/- in default to undergo imprisonment for three months. The fine amount if realised shall be given to PW1 as compensation under Sec.357(1)(b) Cr.P.C.Bail bond executed by the accused stands cancelled and accused is directed to pay the fine amount forthwith,failing which the trial court can take steps to execute the sentence. The amount if any already deposited by the accused shall be given credit to and the complainant is permitted to withdraw the amount already deposited by the accused. Sd/- ## **M.R.ANITHA Judge** Mrcs/1.7.