IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.P.BALACHANDRAN WEDNESDAY, THE 6TH FEBRUARY 2008 / 17TH MAGHA 1929 CRL.A.No.961 of 2001(D) ------------------------------ CC.86/1997 of JUDL.MAGISTRATE OF FIRST CLASS COURT, MATTANNUR .................... APPELLANT/COMPLAINANT: --------------------------------- K.C.REGHUNATH, S/O CHELLAPPAN, KEEZHOOR VILLAGE, THALASSERY TALUK BY ADV. SRI.GRASHIOUS KURIAKOSE SRI.GEORGE SEBASTIAN RESPONDENT/ACCUSED: ---------------------------- P.SHAMSUDHEEN, S/O ABDU, PAYAM. BY P.P. SRI.P.RAVINDRA BABU THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 06/02/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K.P.BALACHANDRAN, J. ------------------------------------------------ Crl. Appeal No.961 of 2001 ------------------------------------------------ Dated this the 6th day of February, 2008 JUDGMENT This is appeal filed with leave by the complainant in C.C.86/97 on the file of the Judicial First Class Magistrate's Court, Mattannur assailing the acquittal of the first respondent of offence under Section 138 of the N.I. Act vide 255(1) Cr.P.C. 2. Complaint was filed by the appellant in the court below complaining of commission by the first respondent of an offence punishable under Section 138 of the N.I. Act inter alia on the allegation that the first respondent borrowed from him an amount of Rs.32,000/- and in repayment of the said amount, he issued Ext.P1 cheque dt.14/11/96 drawn on Iritty branch of Nedungadi bank in favour of the appellant for the said sum of Rs.32,000/-; that on presentation of the cheque for encashment it was returned Crl. Appeal No.961 of 2001 -2- dishonoured vide Ext.P2 memo for reason of insufficiency of funds in the account of the first respondent to honour the said cheque; that thereupon, the original of Ext.P3 notice was caused to be issued to the first respondent through lawyer on 18/11/96 and the first respondent who accepted the said notice under Ext.P4 postal acknowledgment card on 19/11/96 has not cared to pay the amount either within the statutory period or ever thereafter and has also not cared to send a reply to the said notice and that he has thereby committed an offence punishable under Section 138 of the N.I. Act. 3. On appearance of the first respondent in the court below pursuant to receipt of summons, he was served with copies of all relevant documents in the case and was questioned by the Magistrate reading over the particulars of the offence and explaining it to him. Thereupon, he pleaded not guilty and Crl. Appeal No.961 of 2001 -3- consequently, a trial of the case was conducted by the court below. 4. On the side of the complainant, PWs.1 and 2 were examined and Exts.P1 to P5 were got marked. On the complainant closing his evidence the first respondent was questioned under Section 313 Cr.P.C. Thereupon, he generally denied all incriminating circum- stances appearing in evidence against him and maintained that he is innocent. According to him, he has not issued the cheque to the complainant and he had given intimation to the bank that he has lost an unsigned blank cheque from his possession. However, apart from causing production of Exts.D1 to D3 no further evidence was adduced on the side of the first respondent. 5. The court below considered the case in the light of the evidence adduced as aforesaid found that the first respondent is not guilty of the offence punishable under Section 138 of Crl. Appeal No.961 of 2001 -4- the N.I. Act and acquitted him consequent on its finding that the appellant has failed to prove beyond reasonable doubt that Ext.P1 cheque was drawn by the first respondent in his favour and that Ext.P1 was dishonoured not only for reason of “insufficiency of funds”. Hence, this appeal by the aggrieved complainant. 6. It is vehemently contended before me by the learned counsel for the appellant that Ext.P1 cheque was being issued by the first respondent to the appellant while the appellant advanced an amount of Rs.32,000/- to the first respondent on 14/10/96 and thereafter he was giving Ext.D1 letter to the bank on 17/10/96 reporting that the said cheque leaf is lost from his possession on that day and the payment thereunder shall not be made and this is nothing but an ingenious attempt made on the part of the first respondent to see that Ext.P1 cheque is not encashed by the appellant. In this context the Crl. Appeal No.961 of 2001 -5- evidence of witnesses examined on the side of the appellant merits appreciation in the proper perspective. PW2 the Accountant of Iritty branch of Nedungadi Bank was cited and examined as PW2 only on 09/09/99 and then Exts.D1 to D3 were not before court. He was recalled and further examined on 22/02/2000 whereupon Exts.D1 to D3 were caused to be produced from the bank. Ext.D1 is the letter given by the first respondent to the bank informing the bank that blank unsigned check leaf 713909 issued in his account is lost from his possession on 17/10/96 and requesting them not to make payment of the amount if at all the said cheque is presented and to inform him of the matter. So, as on the date of PW1 tendering evidence on 16/03/99 Ext.D1 was not before court. It was while Ext.D1 had not been produced before court that PW1 gave evidence that the first respondent borrowed Rs.32,000/- from him on 14/10/96 issuing Ext.P1 cheque Crl. Appeal No.961 of 2001 -6- dt.14/11/96; and that the said cheque on presentation was returned dishonoured vide Ext.P2 memorandum for the reason “funds insufficient”. It is true that as observed by the court below, there is difference in signatures in Ext.P1 with that of the signatures of the first respondent in Exts.D2 and D3 as also in Ext.D1. However, when the evidence given by PW1 without seeing Ext.D1 is there to the effect that the cheque was being issued to him on 14/11/96 there is no reason to disbelieve the said statement. Now reading Ext.D1 along with Ext.P1 one can understand the ingenious mind of the first respondent to wriggle out of the obligations under Ext.P1. As already stated, the signature affixed in Ext.P1 is different from the signatures of the first respondent in Exts.D1 to D3. That certainly must have been affixed by the first respondent so as to deceive the appellant and to dispute that the signature is not his and Crl. Appeal No.961 of 2001 -7- with that end in view he has given Ext.D1 letter to the bank stating that blank unsigned cheque leaf bearing No.713909 is lost from his possession on 17/10/96. Obviously, the cheque could not have been presented before 14/11/96 the date it bears. Apparently, this was intended to give an impression that even before presentation of the cheque with date 14/11/96 the first respondent has given intimation to the bank regarding loss of such a blank cheque. Further, Ext.P3 notice issued consequent on dishonour of Ext.P1 cheque intimating the first respondent of the dishonour and demanding payment of the amount covered by the said cheque mentioning therein also the number of the cheque leaf and the date of the cheque was received by him under Ext.P4 acknowledgment card on 19/11/96. The first respondent has not cared to issue any reply to the said notice so received by him. Considering the conduct of the first Crl. Appeal No.961 of 2001 -8- respondent who has given Ext.D1 letter to the bank immediately on loss of cheque leaf as alleged by him, he would have certainly issued reply to Ext.P3 notice so received by him refuting his liability for payment of any amount mentioned thereunder and pointing out that Ext.P1 cheque is one made up on blank unsigned cheque leaf lost from his possession and not a cheque issued to the appellant. He having not issued any such reply it can reasonably be presumed that the non-issuance of reply to the said notice is for the reason that the cheque is one issued by him to the appellant and not one made up on a blank unsigned cheque leaf lost form his possession. 7. The further contention which is seen to have been advanced by the first respondent who though served in this appeal has not entered appearance is that Ext.P1 cheque would not have been encashed by the bank even if there was sufficient funds as there is Crl. Appeal No.961 of 2001 -9- difference in signature from the specimen signatures given in Ext.P2 and that therefore, it cannot be considered as a case where the cheque was being dishonoured for reason of “insufficiency of funds”. The argument appears to have been advanced in the court below based on the testimony of PW2 that all reasons mentioned in Ext.P2 memorandum are of equal importance. Out of the reasons so stated, reason No.20 is “drawer's signature differs”. The question as to whether signature of the drawer differs is a matter to be probed into and examined by the bank only in the event of the cheque presented deserves to be encashed prima facie. In the instant case, PW2 has given evidence that as on the date of presentation of Ext.P1 cheque for encashment there remained a balance of only Rs.4,046.40/- which no doubt was insufficient to honour Ext.P1 cheque for Rs.32,000/-. Obviously, when there is no sufficient funds to honour a Crl. Appeal No.961 of 2001 -10- cheque the question as to whether other grounds exist to dishonour the cheque is a matter of lesser importance and those do not deserve to be considered when there is no sufficient funds in the account of the drawer. 8. Thus, I am of the view that the court below has arrived at a wrong finding in the circumstances of the case that the appellant failed to prove beyond reasonable doubt that Ext.P1 cheque was drawn by the first respondent in his favour and that Ext.P1 was being dishonoured not for reason of insufficiency of funds only. In fact, Ext.P1 was dishonoured for that reason only and not for any other reason as no other aspect was called for to be considered to decide as to whether Ext.P1 deserves to be honoured or dishonoured. 9. All statutory formalities which are prerequisites for the maintainability of a complaint under Section 138 of the N.I. Act Crl. Appeal No.961 of 2001 -11- are seen to have been complied with by the appellant. The first respondent having not made payment of the amount covered by the cheque either within the statutory period or ever thereafter despite receipt of Ext.P3 notice under Ext.P4 acknowledgment card, he has committed an offence punishable under Section 138 of the N.I. Act. 10. In the result, I find the first respondent guilty of the offence punishable under Section 138 of the N.I. Act; convict him thereunder and sentence him to undergo simple imprisonment for a term of one year and direct him to pay an amount of Rs.40,000/- to the appellant by way of compensation. K.P.BALACHANDRAN, JUDGE kns/-