IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MRS. JUSTICE M.C.HARI RANI WEDNESDAY, THE 1ST JUNE 2011 / 11TH JYAISHTA 1933 CRL.A.No. 2030 of 2004() ------------------------ C.C.NO.495/2000 OF J.F.C.M MATTANNUR APPELLANT(S): COMPLAINANT ------------------------- M.SANTHOSH, S/O.VIJAYAN NAMBIAR, CONTRACTOR, KOLARI AMSOM, SMITHA SADANAM, P.O.PORORA. BY ADV. SRI.M.RAMESH CHANDER RESPONDENTS/ACCUSED ---------------------- 1. STATE OF KERALA, REP. BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM. 2. RAGHU K.R., S/O.RAMANKUTTY, KALLANINI HOUSE, KOLAKAD, P.O.MALAYAMBADI P.O. ADV. SRI.P.P.RAMACHANDRAN FOR R2 PUBLIC PROSECUTOR SMT.SUMANGALA P.N. THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 01/06/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: M.C.HARI RANI,J. * * * * * * * * * * * * * Crl.A.No.2030 of 2004 ---------------------------------------- Dated this the 1st day of June 2011 J U D G M E N T The appellant is the complainant in C.C.No.495/2000 on the file of the Judicial First Class Magistrate Mattannur which was filed alleging offence under Section 138 of the Negotiable Instruments Act. As per judgment dated 09/01/2004, the accused was acquitted under Section 255(1) of the Cr.P.C which is challenged by the appellant/complainant in this appeal. 2. The case of the complainant put forward in the complaint is briefly as follows: Ext.P1 cheque dated 15/12/1998 was given by the accused to the complainant for the amount of Rs.1,20,000/- which was due from the accused to the complainant. When that cheque was presented for collection, it was dishonoured by the bank due to insufficiency of funds in the account of the accused. Accordingly lawyer notice dated 26/03/1999 was issued to the accused which was accepted on 31/03/1999 and a reply notice was sent by the accused stating untrue statements. Since the accused failed to pay the amount covered under Ext.P1 cheque, Crl.Appeal No.2030/2004 2 the complaint was preferred by the complainant before the learned Magistrate. 3. On the side of the complainant/appellant, PW1 was examined and Exts.P1 to P6 were marked. The accused was examined under Section 313 Cr.P.C. DW1 was examined and Exts.D1, D1(a) and D2 to D8 were marked for the defence. After considering the evidence on record, the learned Magistrate acquitted the accused under Section 255(1) of Cr.P.C which is challenged in this appeal. 4. Heard the learned counsel appearing for the complainant/appellant and the learned counsel for the 1st respondent/accused. Heard the learned Public Prosecutor also. 5. The learned counsel for the appellant submitted that the order of acquittal of the accused is illegal and unsustainable. According to the learned counsel, presumption under Sections 118 and 139 of the Negotiable Instruments Act is in favour of the complainant for the reason that the accused has admitted the execution of Ext.P1 cheque and the evidence adduced from the side of the accused is not sufficient to rebut that presumption. The learned counsel for the 1st respondent supported the Crl.Appeal No.2030/2004 3 judgment of the court below. 6. The point for consideration in this appeal is whether Ext.P1 cheque was issued to the complainant by the accused to discharge any liability. The specific defence case put forward in the cross-examination of PW1 and also in the evidence adduced from the side of the defence, both oral and documentary is to the effect that the accused had never issued a cheque to the complainant and the disputed cheque, Ext.P1 has no valid consideration. How far the complainant has proved his case and whether any presumption under Sections 118 and 139 of the Negotiable Instruments Act is available to the appellant and if so whether the accused has rebutted that presumption by adducing satisfactory evidence is the point for consideration. 7. In the complaint and in the lawyer notice Ext.P4, the case put forward by the complainant was that an amount of Rs.1,20,000/- was due from the accused to him and the accused gave him the cheque dated 15/12/1998 drawn at Kelakam Service Co-operative bank. That cheque, when presented for collection was dishonoured for want of sufficient fund in the account of the accused. Even after the receipt of the lawyer Crl.Appeal No.2030/2004 4 notice sent by the complainant informing the accused about the dishonouring of the cheque and demanding the amount of the cheque, the accused did not pay the amount. Thus, according to the appellant, the accused has drawn the disputed cheque in his favour at Kelakam Service Co-operative bank on the account maintained by the accused with the banker for the payment of an amount of Rs.1,20,000/- to the complainant from the account for the discharge of the liability and the cheque was returned by the bank unpaid due to the insufficiency of funds. So the act of the accused will come under the provisions of Section 138 of the Negotiable Instruments Act which is an offence is the allegation in the complaint. As against these allegations, the accused sent a reply marked as Ext.D6 wherein it was contended that the accused never gave the disputed cheque as alleged by the complainant and the accused was not liable to pay any amount as there was no legally enforcible debt. The circumstances under which the alleged cheque happened to be with the complainant were also stated. 8. The accused examined as DW1 has deposed that he has no prior acquaintance with the complainant and there was Crl.Appeal No.2030/2004 5 no transaction between complainant and accused. He had not borrowed any amount from the complainant as alleged by the complainant. Ext.P1 cheque was not issued to the complainant. According to him, he was conducting a provision store at Poovathumchola during 1990-91. He was a member of Kelakam Vyapari Vyavasai Ekopana Samithi during that period. Kuri was conducted by the said Samithi. Accused subscribed two kuries having its sala of Rs.7,500/- and Rs.50,000/-. Further, he had taken a loan of Rs.10,000/- from the said Samithi. He had auctioned the said kuries, so as a security, he had given Ext.P1 cheque as well as two other blank cheques, to the then President Kadaya Varghese and Secretary Raju Chenkeeriyath. He defaulted the kuri instalments. Ext.P1 cheque was misused and a false case has been foisted against him by the complainant. After receipt of notice of this case, the accused came to know that cheque number 3005 issued to him from the bank on 06/04/1992 was unauthorisedly filled by the complainant and misused that cheque which is the disputed cheque. Ext.D2 is the letter issued by Kelakam Service Co-operative bank stating that cheque No.3001 to 3010 were issued to the accused on Crl.Appeal No.2030/2004 6 06/04/1992 and Ext.P1 cheque having its No.3005 was issued to the accused from his bank. Ext.D3 is the photocopy of a certificate issued by Kelakam Grama Panchayat Secretary on 05/12/2003. It bears the signature and seal of the said grama Panchayat Secretary wherein it was certified that the accused was not conducting, or holding any licence to conduct any business during the period 1995-96 to 2003-04. Ext.D4 is a letter dated 13/8/1996 issued by the accused to the President of Vyapari Vyavasai Ekopana Samithi at Kelakam unit wherein the accused made a request that the three cheques issued to the Samithi may not be used to file a criminal complaint against him. Ext.D5 is the reply dated 02/09/1996 whereby the accused was called upon to have a discussion on 04/09/1996 at 10 a.m in the office of the said Samithi Unit. Ext.D6 is the copy of the reply notice sent by the accused to the complainant in this case. 9. The complainant's case both in the complaint as well as in the notice and while examined as PW1 from the witness box was that he had given the accused an amount of Rs.1,20,000/- out of friendship and the accused issued the disputed cheque for that amount which was bounced when presented before the bank Crl.Appeal No.2030/2004 7 and after statutory notice the complaint has been filed against the accused. Whereas the definite case of the accused in the cross-examination of PW1, during 313 examination and when examined as DW1 before the trial court was that he did not know the complainant and the disputed cheque was not given by him to the complainant and the same was given by him as security while he availed a loan of Rs.10,000/- from Kerala Vyapari Vyavasai Ekopana Samithi when he was a member and a subscriber of two kuries run by the said Samithi. One of the three blank cheques handed over as security to the then President and Secretary of the said Samithi was misused by the complainant and a false case was foisted against him. Thus, the accused has the specific defence that the cheque in question was one of the three blank cheques bearing his signature which was given by him as security to the Vyapara Vyavasai Ekopana Samithi of which Kadaya Varghese was the President and Raju Chenkeeriyath was the Secretary and with their connivance, the complainant misused the same. According to the accused, the complainant had written the entries and also the amount in Ext.P1 cheque and presented the same before the bank. The Crl.Appeal No.2030/2004 8 accused as DW1 has deposed that there was no legally enforcible debt or liability between the parties since he had not borrowed any amount as alleged by the complainant. The complainant as PW1 has deposed that the accused borrowed Rs.1,20,000/- from him in November 1998 for his business purpose agreeing to repay the same and Ext.P1 cheque was given by the accused on 15/12/1998 from his shop at Mattannur. In the cross- examination, PW1 has deposed that he did not remember the date when the amount was given to the accused and it was not recorded anywhere. Further, there is no document to show the date on which the amount was given to the accused. No witness was present at that time. In the year 1998 he was doing business of spare parts and was keeping accounts which were verified by income tax authorities at the relevant time. But in that account this amount given to the accused was not entered for no reason. According to PW1, he came to know of the accused after 1995 from a shop at Poovathumchola and did not know the owner of that shop. It is curious to note that he came into acquaintance with the accused while he went to the shop for drinking water and while the accused was doing work of pipe Crl.Appeal No.2030/2004 9 line. Further, an amount of Rs.1,20,000/- was given by the complainant to the accused without any stipulation to pay any interest which cannot be believed. 10. Thus the case of the accused that he had given three blank cheques to Vyapari Vyavasai Ekopana Samithi and this case has been foisted against him by the complainant is more probable. The case of the complainant that he had advanced an amount of Rs.1,2,00,000/- to the accused out of friendship is not substantiated. Complainant could not prove the friendship and he could not even identify the accused and had failed to point out the accused in Ext.D1 photograph as correctly found by the lower court. After considering all these evidence adduced by the parties, I find that the defence case put forward both in the oral evidence as well as in the documentary evidence that the accused had neither borrowed any amount nor gave any cheque to the complainant can be accepted as more probable. 11. It is not the signing of the cheque, but its execution that is necessary to draw the presumption under Section 139 of the N.I.Act. If only execution is established, then only the presumption follows that it has been issued towards discharge of Crl.Appeal No.2030/2004 10 a debt or liability. Execution of the instrument is not a physical act of signing the instrument but of drawing that instrument with the intent to do so. No doubt, there will be cases of obtaining blank signed cheques as security for loan transaction. In such a case, mere signing of the instrument cannot be considered as execution of the instruments. But, of course, when the instrument is admitted as duly signed, a burden is cast on the accused to place materials for substantiating his/her evidence to rebut the presumption under Section 139 of the N.I.Act that the instrument has not been executed towards discharge of a debt or liability. Where the accused has discharged the burden by producing materials or from the circumstances presented in the case, showing that the defence case pleaded is more probable, unless and until the complainant establishes due execution of the cheque and the transaction as alleged, no conviction is permissible by drawing the presumption under Section 139 of the N.I.Act. In the present case, the complainant has not proved his case despite rebuttal of the presumption under Section 139 of the N.I.Act by the accused by showing that her defence version is probable. It is clear from the judgment rendered by Crl.Appeal No.2030/2004 11 the lower court that after careful consideration of the evidence on record the learned J.F.C.M-II Mattannur came to the conclusion that the defence case is more probable and the accused has succeeded in rebutting the presumption under Sections 118 (a) and 139 of the N.I.Act and the accused was found not guilty under Section 138 of the N.I.Act and he was acquitted. 12. I find that the abovementioned finding of the lower court and the judgment passed by the learned Trial Judge do not suffer from any legal infirmity or perversity. It was not a case where the learned Trial Judge failed to consider the evidence brought on record and/or misappropriated the same. Therefore, I am not inclined to interfere with the findings entered by the lower court that the accused is not guilty in this case. 13. Accordingly, the judgment passed by the lower court is confirmed and the appeal is dismissed. (M.C.HARI RANI, JUDGE) jsr // True Copy// PA to Judge Crl.Appeal No.2030/2004 12 Crl.Appeal No.2030/2004 13 M.C.HARI RANI, J. .No. of 200 ORDER/JUDGMENT 29/07/2009