IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.SASIDHARAN NAMBIAR WEDNESDAY, THE 11TH AUGUST 2010 / 20TH SRAVANA 1932 Crl.Rev.Pet.No. 1704 of 2003(D) ------------------------------- CRA.374/1999 of ADDL.SESSIONS COURT, KOZHIKODE CC.343/1997 of JUDL.MAGISTRATE OF FIRST CLASS, VADAKARA .................... PETITIONER/APPELLANT/ACCUSED ---------------------------------------------------- N.P.SREEDHARAN, S/O KADUNGAN NELLIPARAMBATH HOUSE NARIPPATTA AMSOM THINOOR DESOM VADAKARA BY ADV. SRI.M.GOPIKRISHNAN NAMBIAR COMPLAINANT & STATE/RESPONDENT/RESPONDENT ------------------------------------------------------------------------------- 1. N.K.JAYAN S/O GOPALAN NEROTH THAZHEKUNIYIL HOUSE P.O. KANNOOKARA ONCHIYAM AMSOM, DESOM, VADAKARA. 2. STATE OF KERALA REP. BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA. BY PUBLIC PROSECUTOR SMT. REKHA C.NAIR ADV. SRI.R.PARTHASARATHY FOR R1 SMT.S.LAKSHMY FOR R1 THIS CRIMINAL REVISION PETITION HAVING BEEN FINALLY HEARD ON 11/08/2010, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: CRL.R.P. NO.1704/03 ORDER ON CRL.M.APPL. NO.7621/03 IN CRL.R.P. NO.1704/03 DISMISSED SD/- 11.8.2010 M.SASIDHARAN NAMBIAR, JUDGE /TRUE COPY/ PA TO JUDGE M.SASIDHARAN NAMBIAR, JUDGE CRL.R.P. NO.1704/03 ORDER DATED, 11.8.2010 M.SASIDHARAN NAMBIAR, J. --------------------------- Crl.R.P. No. 1704 OF 2003 -------------------------- Dated this the 11th day of August, 2010 O R D E R Petitioner, the accused in C.C. No.343 of 1997 on the file of Judicial First Class Magistrate, Vadakara, who was convicted and sentenced for the offence under Section 138 of Negotiable Instruments Act filed this revision challenging the concurrent conviction and sentence. 2. First respondent lodged the complaint alleging that petitioner and first respondent were on cordial terms for several years and petitioner who is a businessman in timber had asked for a loan of Rs.2,00,000/- for bidding a coup and first respondent had with him only a cash of Rs.1,00,000/- and he promised to pay that amount if petitioner repay the same within three months. But petitioner stated that he need Rs.2,00,000/- as Rs.1,00,000/- is not sufficient and requested first respondent to arrange the amount somehow. The first respondent agreed to avail a loan of Rs.75,000/-, as he was the subscriber to a chitty being conducted by KSFE, for Rs.5,00,000/-, provided petitioner furnishes security of his immovable property. When the petitioner furnished security of his property, first respondent availed a loan of Rs.75,000/- and Crl. R.P. No.1704/03 2 using the said amount of Rs.75,000/- and Rs.1,00,000/-, which was already with him, first respondent paid Rs.1,75,000/-. Petitioner promised to repay the same within three months. But, petitioner failed to pay that amount even after the expiry of three months. When first respondent contacted him, he asked for time. Finally, when first respondent approached the petitioner and informed that he is badly in need of money, on 6.4.1997 petitioner came to his house and stated that he will receive the amount on 15.4.1997 and for that purpose first respondent need not meet him again and issued Ext.P1 cheque for Rs.1,75,000/- with the date 15.4.1997, drawn in his account in Vilangad Service Co-operative Bank making him believe that the amount will be there on 15.4.1997. When first respondent presented the cheque for encashment, it was dishonoured for want of sufficient funds. On 16.4.1997 first respondent sent a lawyer notice demanding the amount covered by Ext.P1 cheque. Petitioner received it on 21.4.1997 but did not pay the amount and did not sent any reply and thereby committed the offence. 3. Learned Magistrate took cognizance of the offfence. Petitioner on appearance pleaded not guilty. First respondent was Crl. R.P. No.1704/03 3 examined as PW1 and Exts.P1 to P6 were marked on his side. On the side of the petitioner, he examined the Manager of KSFE as DW1 and marked Exhibits D1 to D3. The learned Magistrate on the evidence found the petitioner guilty. He was convicted and sentenced to simple imprisonment for six months for the offence under Section 138 of Negotiable Instruments Act. Petitioner challenged the conviction before Sessions Court, Kozhikode in Crl. Appeal No.374 of 1999. Learned Additional Sessions Judge on reappreciation of evidence, confirmed the conviction and sentence and dismissed the appeal. It is challenged in the revision. 4. Learned counsel appearing for the revision petitioner and first respondent were heard. 5. The learned counsel appearing for the petitioner argued that as per the evidence of PW1, he paid Rs.2,00,000/- making use of Rs.75,000/- availed from KSFE and the amount was paid on 15.10.1996 and Ext.P1 cheque dated 15.4.1997 was later issued on 6.4.1997 and the evidence of DW1 with Exts.D1 to D3 would establish that the loan was sanctioned to first respondent from KSFE only on 24.10.1996 and the amount availed was only less than Crl. R.P. No.1704/03 4 Rs.70,000/- and in such circumstances, courts below should have found that Ext.P1 cheque was not issued towards discharge of an existing liability. It was argued that courts below did not properly appreciate the evidence and when it is proved that the petitioner has not borrowed Rs.1,75,000/-, as claimed by the first respondent, it should have found that Ext.P1 cheque was not issued as contended by the first respondent and therefore the conviction is bad. 6. Learned counsel appearing for the first respondent submitted that when PW1 was cross-examined, he was not asked about the details brought out by the evidence of DW1 and in such circumstances based on those evidence, the case of the first respondent cannot be disbelieved. The learned counsel also pointed out that for realisation of the amount borrowed by the petitioner, first respondent had instituted a civil suit, which was already decreed in favour of the first respondent and in such circumstances, there is no reason to interfere with the conviction. 7. The learned Magistrate and the learned Sessions Judge convicted the petitioner drawing the presumption under Section 139 of Negotiable Instruments Act and rejecting the case of the petitioner Crl. R.P. No.1704/03 5 that he had borrowed Rs.15,000/- and issued a blank cheque. The discrepancy with regard to the amount obtained by the first respondent from KSFE under loan and the date of payment were not properly appreciated. On going through the evidence, I find it difficult to accept the findings of the courts below. 8. In the complaint, first respondent not only claimed that Ext.P1 cheque was issued towards repayment of the loan borrowed earlier, but also elaborately pleaded how the amount allegedly paid to the first respondent was available with him. It is the allegation in the complaint that when petitioner asked for a loan of Rs.2,00,000/- he had with him a cash of Rs.1,00,000/- which was the sale proceeds of a vehicle and petitioner insisted for a loan of Rs.2,00,000/-. According to the complainant, first respondent being a subscriber of chitty for Rs.5,00,000/- in KSFE, he promised to take a loan and availed the loan and paid Rs.75,000/- along with Rs.1,00,000/-, which was already with him. It is the case that petitioner agreed to furnish his property for that purpose. It is also admitted that petitioner had given his property as a charge for the loan of Rs.75,000/- obtained by first respondent from KSFE and along with Crl. R.P. No.1704/03 6 Rs.1,00,000/-, which was with him, he paid Rs.1,75,000/- and on receiving the amount, petitioner agreed to repay the same within three months. It is the case that when there was failure on the part of the petitioner to pay that amount, first respondent contacted him and he sought time and finally on 6.4.1997, petitioner came to the house of the first respondent and informed him that he will get the money before 15.4.1997 and issued Ext.P1 cheque on 6.4.1997. If the said case of the first respondent is to be accepted, he should have received the loan of Rs.75,000/- from KSFE before 15.10.1996. According to PW1, he paid the amount on 15.10.1996, though the date was not mentioned in the complaint. The evidence of DW1 the Manager of KSFE conclusively establishes that the loan applied for by the first respondent was sanctioned only on 24.10.1996 and the amount sanctioned was not Rs.75,000/- but only Rs.68,651/-. This aspect was not challenged by the first respondent when DW1 was cross-examined. Therefore, petitioner conclusively proved that first respondent did not obtain any loan on 15.10.1996 to be paid to the petitioner and instead he obtained only Rs.68,651/- and that too it was given to the first respondent by a cheque only on 24.10.1996. Crl. R.P. No.1704/03 7 This fact itself is sufficient to disbelieve the evidence of PW1 that he granted an oral loan of Rs.1,75,000/- to the petitioner, as claimed by him 9. The evidence of DW1 establishes that on 17.1.1997 Ext.D1 notice was sent by KSFE intimating petitioner that first respondent, the loanee, did not pay the amount due. Therefore, petitioner as the surety, was asked to pay Rs.58,416/- threatening that on the failure his property will be attached and proceeded against. Ext.D2 is the notice issued to the petitioner on 24.4.1997 directing him to pay the amount within 30 days threatening that on the failure his charged property will be proceeded against. The issuance of Ext.P1 cheque is to be appreciated in this background. When it is admitted by the first respondent that he availed a loan form KSFE and for that loan the property of the petitioner was mortgaged and first respondent did not pay the amount and petitioner was proceeded for realisation of the amount, as he is the surety and his properties were mortgaged for the loan availed by the first respondent, it is impossible to believe the case of the first respondent that on 6.4.1997 petitioner went to the house of the first respondent Crl. R.P. No.1704/03 8 and promised that he would get the amount before 15.4.1997 and issued Ext.P1 cheque. No prudent man would issue a cheque for Rs.1,75,000/-, when he received a notice from the KSFE threatening that for realisation of the amount due from the first respondent his properties will be proceeded against. Therefore this aspect itself is sufficient to disbelieve the evidence of PW1 that on 6.4.1997 petitioner went to the house of the first respondent and issued Ext.P1 cheque. 10. True, the case of the petitioner is that he availed a loan of Rs.10,000/- and issued Ext.P1 as a blank cheque as the security of that amount and no evidence was adduced in support of the plea. But neither the failure of the accused to prove the defence case nor the weakness of the defence case set up, are sufficient grounds to convict the petitioner for the offence under Section 138 of Negotiable Instruments Act. From the evidence of PW1 and that of DW1, it is proved that issuance of Ext.P1 cheque on 6.4.1997 is highly improbable. Added to this, the evidence of DW1 establishes that first respondent did not receive Rs.75,000/- before 24.10.1996. The only case of the first respondent is that he paid Rs.1,75,000/- to the Crl. R.P. No.1704/03 9 petitioner on 15.10.1996 and for its repayment Ext.P1 cheque was issued. When the case is that first respondent paid Rs.1,75,000/- inclusive of Rs.75,000/- availed from KSFE, and evidence prove that first respondent received as loan only Rs.68,651/- and that too only on 24.10.1996, the case of payment of Rs.1,75,000/- on 15.10.1996 can only be disbelieved. Unfortunately these material aspects were omitted to be taken note of by the courts below in the proper perspective. In such circumstances, conviction can only be set aside. Revision is allowed. Conviction of the petitioner for the offence under Section 138 of Negotiable Instruments Act by Judicial First Class Magistrate, Vadakara, in C.C. No.343 of 1997 as confirmed by the Additional Sessions Judge, Kozhikode in Crl. Appeal 374 of 1999 is set aside. The petitioner is found not guilty of the offence. He is acquitted. M.SASIDHARAN NAMBIAR, (JUDGE) vps Crl. R.P. No.1704/03 10 Crl. R.P. No.1704/03 11