Sree Gokulam Chit and Finance Co. (P) Ltd. v. Damodaran N and State of Kerala

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT:** **THE HONOURABLE MR. JUSTICE SUNIL THOMAS** **TUESDAY, THE 22ND DAY OF NOVEMBER 2016/1ST AGRAHAYANA, 1938** **CRL.A.No. 1017 of 2015 () IN Crl.L.P..345/2015 -----------------------------------------------AGAINST THE ORDER/JUDGMENT IN CC 79/2010 of J.M.F.C.-II, KASARAGOD DATED 31-08-2010** **AGAINST THE ORDER/JUDGMENT IN Crl.L.P. 345/2015 of HIGH COURT OF KERALA DATED 05-10-2015** **APPELLANT(S)/COMPLAINANT: ------------------------** **SREE GOKULAM CHIT AND FINANCE CO.(P) LTD. ARCOT ROAD, KODAMPAKAM, CHENNAI, PIN - 600 024, REPRESENTED BY ITS PRESENT POWER OF ATTORNEY HOLDER:M.T.SUJATHA, W/O.V.RAVEENDRA VARRIER, KASARAGOD, KASARAGOD DISTRICT.** **BY ADV. SRI.MAHESH V RAMAKRISHNAN** **RESPONDENT(S)/ACCUSED & STATE: ------------------------------** **1. DAMODARAN.N** **S/O.LATE KUNHAMBU NAIR, AMBILADY HOUSE, PERUMBALA P.O., KASARAGOD - 671 317.** **2. STATE OF KERALA REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM.** **R1 BY ADV. SRI.JAWAHAR JOSE R1 BY ADV. SRI.ARUN AJAY SHANKAR BY PUBLIC PROSECUTOR:SRI E C BINEESH** **THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 15.11.2016, THE COURT ON 22-11-2016 DELIVERED THE FOLLOWING:** ## **SUNIL THOMAS, J.** ================= **Crl.Appeal.No.1017 of 2015** ================= Dated this the 22[nd] day of November, 2016 ## **JUDGMENT** The appellant herein has assailed the judgment of the Trial Court in C.C.No.79/2010 of the Judicial First Class Magistrate-II (Additional Munsiff) Kasaragod. The above C.C. was filed under section 138 of the NI Act. 2. The complainant approached the court below on the basis of a dishonoured cheque for a sum of Rs.41,225/-. The contention of the complainant was that the accused, who was a subscriber of the cheque, had received the cheque amount and after execution of the bond, price amount was received. He committed default and thereafter towards the discharge of the existing liability, the cheque was issued and delivered. When it was presented for collection, it was returned dishonoured. Statutory notice was issued, which was replied undertaking to discharge the liability. Hence , the complaint was laid. 2. Before the court below the accused appeared, disputed the liability and execution of the cheque. To prove the case of the complainant, PWs 1 and 2 were examined and 9 documents were let in. The court below, after appreciation of the evidence, found that the Crl.A1017/15 2 complainant failed to prove the due execution of the cheque towards the discharge of the legally enforceable debt and acquitted the accused. This is under challenge in this appeal. 3. Heard both sides. 4. It is pertinent to note that the chitty transaction is not in dispute. The signature on the cheque was also not in dispute. The accused is stated to have sent a reply as Ext.P9, in which, he undertook to repay the amount in installments. Even in the above reply notice, there is no dispute regarding the execution of the cheque. At the time of appearance in the cross examination, PW1 contended that he had not sent any reply to the lawyer notice. He disputed Ext.P9 reply also. PW2 asserted that he had sent a reply on the basis of the available materials. Hence, the authorship of Ext.P9 stands proved. The court below at paragraph Nos. 19 and 20 of its judgment proceeded to discuss the execution of the cheque. The court below on a calculation of principal amount, defaulted amount and the interest, arrived at a conclusion that a sum of Rs.36,600/- was not due on 10.05.2009. Hence, it was held that the amount claimed in Ext.P6 notice and the amount shown in Ext.P8 does not tally with each other. It has come out in evidence that the amount in Ext.P1 cheque is in excess of the amount shown due in Ext.P8 statement of account . Crl.A1017/15 3 On that premise, the court held that since the amount did not tally, the cheque could not have been issued towards the legally dischargeable debt. 5. Learned counsel relying on Ground No.D in the appeal submitted that conclusion arrived at by the court below on the quantum was incorrect and the difference, if any, would have been much less. The court below ought not have done an arithmetical calculation to see whether the amount due, tallied with records. It has to be appreciated in the back ground of evidence let in by the parties, defence set up and also the presumption that are to be arrived at. It is pertinent to note that in this case no contra evidence was let in. Hence, the complainant was entitled to draw the statutory presumption regarding the execution and passing of consideration. According to the learned counsel, by definite proof, the execution of the cheque was proved and the court below adopted a wrong procedure in arriving at such a contra conclusion. 6. On the other hand, learned counsel for the respondent contended that the trial court arrived at proper conclusion on the basis of the evidence available on record. It was contended that as per Ext.P6 notice, a sum of Rs.36,600/- with interest was due. Ext.P9 is the reply purported to have been issued by the counsel on behalf of Crl.A1017/15 4 the accused. In Ext.P9 reply , he admitted the liability and contended that he was unable to pay the money. Since sending of reply notice was denied by the accused, PW1 the lawyer who issued Ext.P9 reply notice was examined and it was proved through him. Hence, Ext.P9 reply is proved and hence, binding on the accused. 7. According to the accused, though the notice demanded Rs.36,600 with interest, Ext.P1 cheque dated 31.12.2009 was for a sum of Rs.41,225/-. Ext.P8 was pressed into service by the complainant to prove the existence of the liability. It was a computer print out of the statement of accounts. It was contended that the above document was not proved in accordance with the provisions of the Indian Evidence Act. As per Ext.P8, a sum of RS.40,616/- was due as on 10.12.2009 with interest totalling to Rs.41,022/-. Learned counsel for the petitioner contended that this clearly shows that the cheque amount is much higher than the amount due evidenced from Ext.P8, though not very considerable. Still, relying on the decision reported in **Supply House v. Ullas and Another (2006 KHC 1027),** learned counsel contended that the amount covered by the cheque cannot be in any way be in excess of the liability incurred. In that decision, it was held that in order to deem that one had committed an offence under section 138, the amount covered by the Crl.A1017/15 5 cheque shall be either in discharge of the liability incurred by the drawer, either in full or in part. It cannot in anyway be in excess of the liability incurred unless the complainant proves that the liability to be settled is to the tune of the amount covered by Ext.P1. 8. Court below, on an evaluation of the entire materials came to the conclusion that Ext.P1 cheque was in excess of the amount shown in Ext.P8 statement of accounts. It is pertinent to note that it is for PW1 to explain about the various calculations of interest. Evidently, interest has to be calculated on the basis of the outstanding amount from the date of each remittance. Since it is a complex calculation, the Court should not normally venture into that exercise since each deposit should be calculated and the interest of the outstanding amount is to be calculated for the specific period from the date of remittance of a portion of the amount. Further, these differences should have been the subject matter of cross examination and PW1 should have been given an opportunity to explain the differences, if any. Without adopting that procedure, court below itself has ventured into an enquiry as to whether cheque amount tallied with Ext.P8 amount. PW1 was not challenged on the differences in the cheque amount and his explanation was not solicited. Hence court below cannot rely on a calculation of its own. Crl.A1017/15 6 However, this Court in another decision reported in **Kochayippa v. Suprasidhan (2002 KHC 490)** had held that if the cheque amount is more than actually due, accused cannot be acquitted on the ground of differences of amount. That decision, seems to lay down the correct legal principle. 9. Yet another contention of the learned counsel for the petitioner is that Ext.P8 was not legally admissible in evidence under section 65B of the Indian Evidence Act. This Court **Perumal A.M. v. M/s.Star Tours and Travels (India) Ltd and Another (2010(3)** **KHC 174)** considered the question as to whether better printouts contains the details of transaction is admissible in evidence. It is held that it is admissible in evidence subject to certificate obtained under section 65B(4). Hence, if that is adopted, Ext.P8 is only to be eschewed. If that be so, the contention based on Ext.P8 that there is a difference in the cheque amount cannot survive. On the other hand, what will remain is the oral testimony of the witnesses coupled with Ext.P2 cheque and Ext.P9 reply which independently is sufficient to lead to a conclusion of guilt of the accused. 10. Further the available materials show that the complainant had discharged his legal liability and has proved the due execution of the cheque. I cannot agree with the finding of the court below to the Crl.A1017/15 7 contrary. Finding of the court below that the accused is not guilty on the above ground is liable to be set aside. Since the sentence is set aside. At the revisional stage, I feel that rather than imposing a substantive sentence, matter can be remanded to the court below for the limited purpose, which shall, after hearing both sides, pass appropriate orders moulding the sentence. Appeal allowed in part. Matter is remanded. Both sides shall appear on 22.12.2016. Sd/- ## **SUNIL THOMAS Judge** Sbna/ True Copy / P A to Judge