IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE V.K.MOHANAN WEDNESDAY, THE 18TH MARCH 2009 / 27TH PHALGUNA 1930 CRL.A.No. 1063 of 2001(Y) ------------------------- ST.289/1999 of CHIEF JUDICIAL MAGISTRATE COURT, MANJERI .................... APPELLANT(S): -------------- P.C. DIVAKARAN, S/O. APPUKUTTAN, BHAGAVATHIPARAMBIL VEEDU, POST PUVATHIKKAL, AREACODE. BY ADV. SRI.M.K.CHANDRA MOHANDAS SMT.K.K.RAZIA SRI.C.S.MANILAL RESPONDENT(S): --------------- 1. K.VASUMATHI, W/O. MAPPILAKUNNATH KRISHNANKUTTY, POST KARASSERI, MYSSORMALA. 2. STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM, COCHIN 682 031. R2 BY PUBLIC PROSECUTOR SMT. K.L. LAKSHMI RANI SRI.JACOB ABRAHAM FOR R1 THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 18/03/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: V.K.MOHANAN, J. ---------------------------------------------- CRL.A. No.1063 of 2001 ---------------------------------------------- Dated, 18th March, 2009. JUDGMENT This is an appeal at the instance of the complainant in a prosecution for the offence punishable under section 138 of the Negotiable Instruments Act as he is aggrieved by the order of acquittal passed by the court below under section 255(1) Cr.P.C. 2. The case of the complainant is that the accused borrowed a sum of Rs.1,50,000/- and she issued a cheque drawn on the Karasseri Service Co-Operative Bank on 2.11.1998 towards the return of the said amount. According to the complainant, when he presented the cheque for enashment, the same was dishonoured for the reason of insufficient funds in the account of the accused. Consequently, it is claimed that, the complainant had caused to send registered notice informing the accused regarding the dishonour of the cheque and demanding payment of the amount covered by the dishonoured cheque. Accordingly, the complainant, as the accused had not made the payment, approached the court below by preferring the complaint. When the accused appeared, the particulars of the allegations were read over and explained to her and she pleaded not guilty, consequently, further trial was conducted during which PWs 1 and 2 Crl.A.1063/01 -:2:- were examined from the side of the complainant and Exts.P1 to P6 were marked. When the incriminating circumstances, which emerged during the evidence of the complainant, put to the accused, she denied the entire transaction claimed by the complainant. According to her, she had not borrowed any amount from the complainant and she had not executed the cheque in favour of the complainant. She had also stated that she had no acquaintance with the complainant. On the basis of the rival pleadings and materials on record, the court formulated certain points for its consideration and, finally, found that the prosecution failed to show that the cheque in question was drawn by the accused and thus, according to the court below, the execution of the cheque by the accused remained not proved. Consequently, it is found that the accused is not guilty under section 138 of the Act and she is accordingly, acquitted. It is the above finding and order of acquittal challenged in this appeal. 3. On the following dates, i.e., 15.10.2008, 17.10.2008, 24.10.2008, 30.10.2008, 7.11.2008, 10.12.2008, 19.12.2008, 19.1.2009, the case was adjourned at the instance of both the counsels to find out the possibility of settlement of the matter. On 7.11.2008 it is recorded that counsel for both sides submits that the matter is settled out of court and they sought two weeks time to Crl.A.1063/01 -:3:- make the payment and accordingly, on that day also, the case was adjourned. But subsequently, it is submitted that no settlement was arrived and wanted to have a disposal of this appeal on merit. 4. Thus, today, I have heard Sri M.K.Chandramohan Das, the learned counsel appearing for the appellant and also Sri Jacob Abraham, the counsel appearing for the Ist respondent. I have perused the records and other materials. 5. The learned counsel for the appellant submitted that the complainant has established the execution of the cheque, especially, when there is no denial of the signature thereon by the accused and therefore, the complainant is entitled to get the presumption provided under section 139 of the N.I.Act. But according to the learned counsel, the trial court, without assigning any valid and proper reasoning and overlooking the evidence on record, came into the conclusion that the cheque in question was handed over to the complainant by the husband of the respondent connected with the transaction between the complainant and the husband of the respondent/accused. According to the learned counsel, the above finding is absolutely baseless and without any materials. According to the learned counsel, when the complainant was examined, he had deposed before the court below the entire transaction between the complainant and the accused which Crl.A.1063/01 -:4:- led to the execution of Ext.P1 cheque and issuance of the same in favour of the complainant. It is also pointed out that thus when the complainant established his case, especially, regarding the transaction, execution, issuance of the Ext.P1 cheque etc., it is for the accused to rebut the presumption but the accused has miserably failed to discharge that burden. Even no suggestive question was put in the absence of any defence evidence. Thus according to the learned counsel, the finding and order of acquittal passed by the court below is liable to be reversed and the respondent/accused is liable to be convicted for the offence levelled against her and this Court be pleased to impose appropriate punishment against the respondent. 6. On the other hand, the learned counsel for the respondent submitted that regarding the transaction, there is no averment in the complaint and no evidence was adduced during the trial with respect to those aspects and, thus, the complainant has miserably failed to establish the transaction, execution and issuance of Ext.P1 cheque. It is also pointed out by the learned counsel for the respondent that the complainant, when he was examined as PW 1, admitted during his cross examination that there were frequent transactions between the complainant and husband of the accused and during such transactions, the husband of accused used to submit signed cheques Crl.A.1063/01 -:5:- as security for those loan transactions. Thus according to the learned counsel, in the light of the above evidence, it cannot be said that the finding of the court below is incorrect or illegal. According to the learned counsel, the question of rebutting the presumption does not arise in this case as the complainant has miserably failed to establish prima facie, the transaction, execution and issuance of the cheque. The learned counsel further submitted that even though there was no such burden on the accused to rebut the presumption, the accused discharged its burden of rebutting the presumption. By eliciting the materials and evidence at the time of cross examination of PW1- the complainant, it was shown that cheque in question was one which was handed over by the husband of the accused to the complainant when he availed loan from the complainant. So According to the learned counsel, by adducing such evidence, the defence had succeeded in making out a probable case. Thus According to the learned counsel, the trial court had considered the entire materials and came to the conclusion that the accused is not guilty which finding does not warrant interference in appeal. 7. I have carefully considered the contentions advanced by both the counsel for the appellant as well as the Ist respondent. As per the allegation and the evidence of PW1, Ext.P1 cheque is covered by an Crl.A.1063/01 -:6:- amount of Rs.1,50,000/- and the same contained the signature of the accused. Of course, merely because Ext.P1 cheque contained the signature of the accused, it does not mean that the same was executed and issued by the accused to the complainant towards the discharge of any debt or liability. Though PW1 was examined to prove the case, he was not able to prove the entire transaction. It is the claim of PW1, as stated in the complaint, that he had acquaintance with the accused. PW1 had also admitted that the husband of the accused used to avail loan from him and towards the security of such transaction, the husband of the accused used to give signed cheques. Till then, there is lack of evidence. So according to me, it is just and proper to give an opportunity for the complainant to adduce evidence to substantiate his case before the court below. 8. Going by the evidence and materials on record, it can be seen that PW1 had admitted that the husband of the accused used to take loan from him for which he used to submit signed blank cheques as security for such transaction. In the present case, the trial court in para 8 of its judgment, came into the conclusion that “the evidence given by PW1 shows that the husband of the accused has delivered the cheque as security for the loan obtained by him from Crl.A.1063/01 -:7:- Muhammedkutty through the complainant”. It is also observed that “even if it is assumed that Ext.P1 was delivered to the complainant by the husband of the accused as security for the loan obtained by him, that does not attract section 138 of the Negotiable Instruments Act, since it was not for the repayment of the debt. When a cheque has been issued as security, no complaint will lie under section 138 of the Negotiable Instruments Act” . The above finding and observation are diametrically opposed to the decision of this Court reported in General Auto Sales v. Vijayalakshmi (2005(1) KLT 478) and Moideen v. Johny (2006(3) KLT SN 62(C.No.85). The evidence available on record are not sufficient to hold that the cheque in question was given as a security connected with the transaction claimed by the complainant. There is also no evidence to show that the cheque in question was given as a security with the signature of the accused connected with the transaction between the husband of the accused and the complainant. Therefore, those findings contained in para 8 of the impugned judgment is without any basis and supported by evidence. At the same time, it is equally important to note that there is no explanation Crl.A.1063/01 -:8:- from the side of the accused as to how Ext.P1 cheque was reached in the hands of the complainant. There is not even a suggestion to the effect that it is one of the cheques that handed over to the complainant by the husband of the accused in any of the transactions as admitted by PW1 during his cross examination. In the absence of such suggestion or evidence from the side of the defence, it appears to me that, it is just and proper to give an opportunity to the accused also to adduce evidence, either by adducing separate evidence or by further cross examining PW1, or examining any other witness according to her choice. 9. This Court, in the decision reported in Johnson Scaria v. State of Kerala (2006 (4) KLT 290), has held that “the burden is always on the prosecution to prove the offence against an indictee in all prosecution and a prosecution under section 138 of the N.I.Act is no exception to that general rule. Execution and issue of the cheque have to be proved to draw the presumption under section 139 and section 139 does not shift the burden to prove execution and issue of the cheque. Admission of signature in a Crl.A.1063/01 -:9:- cheque goes a long way to prove due execution. Possession of the cheque by the complainant similarly goes a long way to prove issue of the cheque. The burden rests on the complainant to prove execution and issue. But under section 114 of the Evidence Act appropriate inferences and presumptions can be drawn in each case on the question of execution and issue of the cheque depending on the evidence available and explanations offered”. On application of the above principle in the case in hand, it can be seen that neither the complainant nor the accused has discharged their duties as discussed in this decision. In the decision reported in Krishna Janardhan Bhat v. Dattatraya Hegde ( 2008(1) KLT 425 (SC), the Hon'ble Supreme Court has held that existence of legally recoverable debt is not a matter of presumption under section 139 and it does not raise a presumption in regard to existence of a debt also. In the very same decision, the Apex Court has further held that, an accused, for discharging the burden of proof placed upon him under a statute, need not examine himself and he may discharge the same on the basis of the materials already brought on records. In the decision reported in M/s. Kumar Exports v. M/s. Sharma Carpets (2009(1) Crl.A.1063/01 -:10:- Supreme 231), the Apex Court has held that “the accused may also rely upon the presumptions of fact, for instance, those mentioned in Section 114 of the Evidence Act to rebut the presumptions arising under Sections 118 and 139 of the Act. The accused has also an option to prove non-existence of consideration and debt or liability either by letting in evidence or in some clear and exceptional cases, from the case set out by the complainant, that is, the averments in the complaint, the case set out in the statutory notice and evidence adduced by the complainant during the trial”. In the light of the above facts, and the legal position settled, especially, in the light of the facts referred above, I am of the view that it is only just and proper to set aside the finding of the court below and to remit back the case for fresh consideration, after giving an opportunity to the parties concerned. 10. In the result, the impugned judgment is set aside and the case is remitted back to the trial court for fresh consideration, after giving opportunity to the parties to adduce evidence so as to substantiate their respective claim and pleadings. The case being Crl.A.1063/01 -:11:- pertained to the year 1999, the court below is directed to expedite the disposal of the case as early as possible, at any rate , within 6 months from the date of receipt of copy of this judgment and records in the court below, and the parties are directed to appear before the court below on 18.4.2009 on which date the court shall take up the complaint on file and proceed with the same and dispose of it on merit. V.K.MOHANAN, JUDGE kvm/- Crl.A.1063/01 -:12:- V.K.MOHANAN, J. CRL.A. No..1063 OF 2001 Judgment Dated:18.3.2009