Sree Gokulam Chit and Finance Co. (P) Ltd. v. Thulasobhai Amma and State of Kerala

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT:** **THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS** **WEDNESDAY, THE 11TH DAY OF OCTOBER 2017/19TH ASWINA, 1939** ## **Crl.L.P..No. 332 of 2017 ()** **---------------------------ST 100/2010 of JUDICIAL FIRST CLASS MAGISTRATE COURT-II, VARKALA** **----------** **PETITIONER/COMPLAINANT :** **----------------------------------------** **SREE GOKULAM CHIT AND FINANCE CO. (P) LTD. HAVING ITS CORPORATE OFFICE AT SREE GOKULAM TOWERS, NO.66, ARCOT ROAD, KODAMPAKAM, CHENNAI, PIN - 600 024, REPRESENTED BY ITS PRESENT POWER OF ATTORNEY HOLDER:REMA MANI.C, LEGAL CLERK, ATTINGAL DIVISION OFFICE, SS PLAZA, N.H.ROAD, ATTINGAL, THIRUVANANTHAPURAM, KERALA.** **BY ADV. SRI.MAHESH V RAMAKRISHNAN** **RESPONDENT/ACCUSED & STATE :** **-------------------------------------------------** **1. THULASOBHAI AMMA A W/O.SOMARAJAN UNNITHAN, CHANDR MANA, MULAKALATHUKAVU,KILIMANOOR-695 601.** **2. STATE OF KERALA REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM-682 031.** ## **R1 BY ADVS. SRI.ELDHO MATHEW SRI.C.R.SIVAKUMAR** ## **R2 BY PUBLIC PROSECUTOR SRI. JESTIN MATHEW** **THIS CRIMINAL LEAVE PETITION HAVING BEEN FINALLY HEARD ON 11-10-2017, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **bp** ## **ALEXANDER THOMAS, J.** ================== Crl.L.P.No.332 OF 2017 ================== Dated this the 11[th] day of October, 2017 ## **O R D E R** This is a petition seeking special leave of this Court under Sec. 378(4) of the Cr.P.C. to file criminal appeal so as to impugn the judgment dated 22.6.2015 of the trial court concerned (court of Judicial First Class Magistrate-II, Varkala), whereby the accused in S.T.No.100/2010 has been acquitted of the offence punishable under Sec.138 of the Negotiable Instruments Act. The petitioner herein is the complainant in S.T.No. C.C.No. 100/2010 and the 1[st] respondent herein is the accused therein. 2. Heard Sri.Mahesh V.Ramakrishnan, learned counsel appearing for the petitioner (complainant), Sri.C.R.Sivakumar, learned counsel appearing for R-1 and Sri.Justin Mathew, learned Prosecutor, appearing for R-2 State. 3. The brief of the case of the complainant is to the effect that the complainant is a company registered under the Companies Act, 1956 and is conducting chit transactions and that the accused is a guarantor to a chit transaction entered into by a subscriber with the company and that the chit was prized in favour of the subscriber and that at the time of disbursal of the prized chit amount to the subscriber, the accused had stood as Crl.L.P.332/17 - : 2 :- guarantor in that transaction and he had duly executed promissory note and that after receiving the prized amount, the subscriber had defaulted in making due instalment payments, consequent to which, the complainant company had issued notices on the subscriber and the guarantor, calling upon them to pay the defaulted amounts and that the accused, as guarantor, had voluntarily come to the Varkala branch office of the complainant company and had issued Ext.P-2 cheque Dated 12.8.2008 for Rs.56,590/- in discharge of the liability owed by the subscriber and that the cheque when presented, resulted in dishonour, etc.. 4. During the trial, the complainant has examined as P.W-1 (power-of-attorney holder of the complainant company), P.W-2 (Bank Manager) and P.W-3 (official of the complainant company) and has marked Exts.P-1 to P-8 documents. The defence has not adduced any oral or documentary evidence. Exts.X-1 and X-2 are the documents marked during the trial. 5. It is the admitted case of the complainant that the entire transactions were entered into by the subscriber in the Kilomanoor branch of the complainant company and that whereas the accused, as the guarantor, had gone to the Varkala branch of the complainant company and handed over the instant cheque in the discharge of the liability, etc. The specific case of the accused is to the effect that at the time he stood as Crl.L.P.332/17 - : 3 :- guarantor to the subscriber in the abovesaid transaction, a blank signed cheque was taken as security from him by the complainant company and that he has never been issued any notice by the complainant company to pay the defaulted amounts of the subscriber and further that he has never gone to the Varkala branch of the complainant company to handover the instant cheque and that the abovesaid cheque, which was given as blank singed one, has been misused by the complainant to institute the present complaint proceedings, etc. 6. The trial court by a considered judgment has found that the accused is entitled to the benefit of acquittal in view of the following reasons: **(A)** The instant complaint has been filed by P.W-1 who is the power-of-attorney holder of the complainant company. There is no assertion either in the power-of-attorney or in the complaint that P.W-1 has direct knowledge about the chit transactions in question as well as the transaction regarding the alleged execution and handing over of the cheque. The Apex Court has held in the decision in _**A.C.Narayanan v. State of Maharashtra**_ reported in 2014 (11) SCC 790 = 2013 (4) KLT 21 (SC) has held that though it is permissible for a complainant to institute a complaint through a power-of-attorney holder, it is imperative that there shall be an explicit assertion as to the knowledge of the power-of-attorney Crl.L.P.332/17 - : 4 :- holder as to the transactions in question and the same should be specified in the complaint. That though power-of-attorney is legally competent, the power-of-attorney should depose before the court that he has witnessed the transaction and that he possessed due direct knowledge regarding the transaction in question and that it should be explicitly asserted in the complaint itself as to the knowledge of the power-of-attorney holder of the transaction and that the power-of-attorney holder, who has no direct knowledge regarding the transactions, cannot competently give evidence in favour of the complainant. It has also been held by the Apex Court in the decision in _**A.C.Narayanan & Anr. v. State of Maharashtra & Ors.**_ reported in AIR 2015 SC 1198 = 2015 (1) KLD 217 (SC) that when the employee of the company files a complaint on behalf of the company, he should certainly know everything about the transactions in question, etc. Further, that the trial court has noted that P.W-1, during evidence, has candidly admitted that the details as to how the liability figure of Rs. 56,590/- arose, is not known to him directly and however, he could learn it only from the previous branch manager of the Varkala branch. Therefore, in the light of these aspects, the non-assertion in the complaint about the direct knowledge of P.W-1 about the transactions and the abovesaid admission made by P.W-1, has been held to be fatal to the case of the complainant. Crl.L.P.332/17 - : 5 :- (B) It is the admitted case of the complainant company that the chit transactions between the subscriber and the company had taken place in the Kilimanoor branch of the complainant company and that whereas the alleged incidents of voluntarily executing and handing over of the cheque by the accused has happened in the Varkala branch of the complainant's company. The accused would assert that he has handed over the blank singed cheque and that no notice has ever been issued to him by the complainant company and that his blank signed cheque has been misused. Further that he has never gone to the Varkala branch of the complainant company. When the basic transaction is at Kilimanoor branch, the version projected by the complainant as if the accused had voluntarily come forward to the Varkala branch of the complainant company, etc. has raised serious doubts and suspicions in the mind of the court about the very believability and credibility of the case set up by the complainant. The complainant was obliged to let in some relevant circumstances relating to the alleged transaction to convince the trial court as to how the transaction of handing over of the cheque happened to occur in the Varkala branch. No such explanation has even been endeavorued to be given by any of the prosecution witnesses. Therefore, the trial court has held that this raises serious suspicion in the mind of the court about the very believability and credibility of the transactions. The Apex Court has held in the decisions as Crl.L.P.332/17 - : 6 :- in _**Vijay v. Laxman & Anr**_ . reported in (2013) 3 SCC 86, that when the basic case set up by the holder of the cheque/complainant itself is dubious, then the initial presumption under Sec. 139 of the Negotiable Instruments Act itself comes to an end. This Court has held in the decisions as in _**Bhaskaran v. Mohanan**_ , reported in 2009 (2) KLT 897 that where the materials before the court disclose suspicious circumstances surrounding the transactions, then it is not safe and permissible to render conviction solely on the basis of statutory presumption and the court is expected to examine whether the transaction covered by the cheque is genuine and bona fide, etc. In the light of these aspects, the view of the trial court cannot be seriously found fault with. (C) The complainant has not produced the notice alleged to have been issued to the subscriber and the guarantor/accused. When the accused has asserted that he has never received notice from the complainant company, etc. the complainant was obliged to allay such suspicion by producing such documents, which should have been in their custody. If such notice has actually been issued by the complainant company, certainly it is quite easy for them to produce the same and non production of such a vital document has been held to be fatal to the prosecution case. Still further the promissory note said to have been executed by the guarantor in favour of the complainant company has not Crl.L.P.332/17 - : 7 :- been produced. More crucially, even the ledger statement, statement of accounts, etc. have not been produced before the trial court to convince the trial court as to how the liability figure of Rs. 56,590/- has been arrived at. No documents have been produced before the trial court to show as to what exactly is the agreed rate of interest. In the light of the non-production of such vital documents, the trial court cannot be found fault with having taken the view that no safe and reliable materials have been produced by the complainant for convicting the accused and that therefore the accused is entitled to the benefit of acquittal. 7. It is in the light of these factual findings that the trial court has come to the considered conclusion that the accused is entitled to the benefit of acquittal. The said findings of facts cannot be said to be perverse or illegal. Merely because another view is plausible, is no ground to interfere with the considered verdict of acquittal. 8. In the case _**State of Rajasthan v. Darshan Singh @ Darshan Lal**_ reported in (2012) 5 SCC 789 = 2012(4) Supreme 72, the Apex Court has held as follows:- _“In exceptional cases where there are compelling circumstances and the judgment under appeal is found to be perverse, the appellate court can interfere with the order of acquittal. The appellate court should bear in mind the presumption of innocence of the accused and further that the trial court's acquittal bolsters the presumption of his innocence.”_ ## Further, in the case _**Pudhu Raja and another Vs. State** reported in_ (2012) 11 SCC 196 = (2013) 1 SCC (Cri) 430 , the Apex Court has held that, “ _The Appellate_ Crl.L.P.332/17 - : 8 :- _court can interfere only in exceptional cases where there are compelling circumstances and the judgment in appeal is found to be perverse. The Appellate court should bear in mind the presumption of innocence of the accused and further that the trial court's order of acquittal bolsters the presumption of innocence_ ”. 9. On an examination of the aforementioned facts and circumstances involved in this case and on an appreciation of the evidence adduced before the court below and the impugned findings rendered by the court below, this Court is of the considered opinion that even if appeal is entertained, there is very little scope of any interference with the conclusive findings of the court below, which led to the acquittal in the impugned judgment. Accordingly, this Court is constrained to hold that the Leave Petition is bereft of any merit and accordingly, the same is dismissed. ## sdk+ Sd/ALEXANDER THOMAS, JUDGE ///True Copy/// ## P.S. to Judge