IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE V.K.MOHANAN THURSDAY, THE 6TH NOVEMBER 2008 / 15TH KARTHIKA 1930 CRL.A.No. 107 of 2000() ----------------------- CC.218/1996 of CHIEF JUDICIAL MAGISTRATE COURT, THRISSUR .................... APPELLANT/COMPLAINANT: ------------------------------------------- M/S. MAJOR KURIES AND LOANS (P) LTD. SITUATED AT NARAYANA BLDG. PAZHAYA NADAKAVU, THRISSUR VILLAGE REP. BY ITS CHAIRMAN, JOHNY, S/O. ALLOR LONAPPAN PURANATTUKARA VILLAGE THRISSUR TALUK BY ADV. SRI.LELLULAL T.G.THUNDATHIL SRI.S.SHYAM SRI.SAJI VARGHESE KAKKATTUMATTATHIL RESPONDENTS/ACCUSED: ----------------------------------------- 1. M.L.DAVIS, S/O. MANI CHAKKU LAZAR PERUVANKULANGARA DESOM OLLUR VILLAGE, THRISSUR TALUK 2. STATE OF KERALA, REP. BY THE PUBLIC PROSECUTOR HIGH COURT OF KERALA, ERNAKULAM BY ADV SRI.G.SREEKUMAR (CHELUR) FOR R1 BY PUBLIC PROSECUTOR SHRI. P.A. SALIM FOR R2 THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 6/11/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: V.K.MOHANAN, J. ------------------------------- Criminal Appeal No.107 OF 2000 ------------------------------- Dated this the 6th November, 2008. JUDGMENT This appeal is preferred by the complainant challenging the order of acquittal passed by the trial court under Section 255(1) Cr.P.C in a private complaint preferred by him for the offence under Section 138 of the Negotiable instruments Act against the respondent-accused. 2. The case of the appellant-claimant is that the accused borrowed an amount of Rs.36,000/- on 29.11.1993 from the complainant agreeing to return the amount with 12% interest on demand and executed a bond for this amount. Thus towards the payment of the amount the accused issued a cheque for Rs.46,080/- including principal and interest on 15.4.1996 drawn on Thrissur Urban Co-operative Bank. According to the complainant when the above cheque was presented for collection through Dhanalakshmi Bank, Thrissur it was returned on 22.4.1996 stating that 'payment is stopped by the drawer'. Thus according to the complainant, the accused has stopped the payment so as to Crl. Appeal 107/2000 2 cheat the complainant. As the amount was not paid, in spite of the notice sent by the complainant, the complainant approached the court below and filed a complaint upon which the court took cognizance after requiring the sworn statement of the complainant. When the accused appeared in pursuance to the process issued to him the particulars of the allegations in the complaint were read over and explained to the accused to which he pleaded not guilty. P.Ws 1 to 3 were examined and Exts.P1 to P9 were marked on the side of the complainant. After the prosecution evidence was over the incriminating circumstances came out through the evidence put to the accused and he denied the same. He had further stated on 22.4.1996 that he got the auction and received the amount and the same has been repaid. Towards the security for repayment 13 cheques were given and when the cheques were demanded back after settlement of the account he was sent out saying that the records are with the chairman. He had also stated that he had given the stop memo in the bank since the blank cheques entrusted between the kury company was not returned in spite of several demands. To substantiate the defence case two witnesses P.Ws 1 and 2 were examined and Exts.D1 and D2 were marked. Crl. Appeal 107/2000 3 3. Considering the rival contentions and pleadings the trial court considered three points. Finally the court found that no amount was due from the accused towards the complainant on the date of Ext.P1 and Ext.P1 was not issued to discharge the legal debt due to the complainant. The trial court held that the ingredients of Section 138 of the Negotiable Instruments Act is not attracted. Thus all the three points were found against the complainant and the accused is found not guilty and accordingly he is acquitted. It is the above finding and the order of acquittal that is challenged in this appeal. 4. I have heard learned counsel for the appellant as well as the respondent-accused. 5. According to the appellant the complainant has adduced evidence through his oral testimony and also through documents and thereby establish that Ext.P1 cheque was executed and issued by the accused towards the debt due to the complainant which arose out of the borrower for a sum of Rs.36,000/- from the complainant on 29.11.1993. According to the counsel for the appellant all the ingredients of Section 138 are established on the basis of the specific averments and also evidence adduced in that Crl. Appeal 107/2000 4 regard. According to the appellant, in spite of the fact that there are evidences and materials in support of the allegations and the claim of the complainant, the trial court after having considered the materials and evidence came into an erroneous conclusion and therefore, the finding of the court below is liable to be set aside. According to the appellant Ext.P1 cheque was duly executed and issued by the accused to the complainant and also on the basis of the evidence regarding the loan transaction a presumption can be drawn under Section 139 of the Negotiable Instruments Act. Learned counsel pointed out that the defence has denied the execution and issuance of the cheque in favour of the complainant and the specific case of the defence is to the effect that no transaction has been entered into between the accused and the complainant, as claimed by the complainant. On the other hand the defence has succeeded in proving that he was a subscriber of two kuries conducted by the complainant and obtained the kury amount at the instance of the complainant and several blank documents were got signed including cheque leaf and Ext.P1 is one of the said cheque leaf obtained by the complainant connected with the earlier kury transaction. Learned counsel submitted that going Crl. Appeal 107/2000 5 by the evidence of the complainant himself the above defence case be proved as correct and besides such materials the defence has also adduced evidence in support of the defence case and thereby the case of the defence is more probable, which according to the learned counsel is sufficient to rebut the presumption. Thus no interference is warranted with the order of acquittal passed by the trial court. 6. I have carefully considered the rival contentions advanced by both the counsel and also perused the materials and evidence on record. 7. Going by the averments contained in the complaint, in Ext.P3 notice and also through the deposition of P.W.1 one cannot understand that the specific case of the complainant is that there was a loan transaction between the complainant and the accused and thus the complainant is more particular that the accused borrowed a sum of Rs.36,000/- from the complainant on 29.11.1993, after accepting the contention that the amount will be repaid with 12% interest and it is the further case that on the basis of such promise the complainant parted with that much amount on the basis of the promisory note and thereafter towards the Crl. Appeal 107/2000 6 discharge of liability arose out of such transaction, the accused issued Ext.P1 cheque dated 15.4.1996 wherein the amount shown as Rs.46080/-. This amount, according to the claimant include interest for the principal amount of Rs.36,000/-. In terms of the above case of the complainant he tried to adduce evidence. In this juncture it is relevant to note that in reply Ext.P3 notice the accused sent Ext.P6 notice wherein the accused raised his contention denying the execution and issuance of the cheque as claimed by the complainant and also describing the circumstances under which the cheque in question happened to be in the hands of the complainant. In spite of such a case raised by the defence, the complainant is very particular when he filed the complaint that the amount due from the accused to the complainant is based upon the loan transaction between them as mentioned above. 8. I have already perused the deposition of P.W.1. In support of the case of the complainant, P.W.2 was examining and thus it came out in evidence that Ext.P1 cheque was dishonoured for the reason that the payment is stopped by the drawer. Ext.P9 is the certified copy of account of the accused which marked through P.W.2. As observed by the trial court the payment was stopped Crl. Appeal 107/2000 7 much earlier to the date of Ext.P1 cheque. In a case for the prosecution under Section 138 of the N.I Act when the evidence is to the effect that the cheque was dishonoured for want of sufficient funds and if the other ingredients of Section 138 are established, a finding can be arrived at in favour of the complainant or holder of the cheque and against the drawer provided there are other evidence and materials. When the cheque in question is dishonoured for the reason other than insufficiency of funds, as in the present case for stoppage of payment it is incumbent upon the court which deals with the prosecution under Section 138 to find out whether such direction was given by the drawer for genuine reason or for the purpose of saving himself from the liability that arose under Section 138 of the N.I.Act. 9. In the present case, according to the accused he had subscribed two kuries which was conducted by the complainant and when those kuries were auctioned and confirmed in favour of the accused and when he received the money out of that two kuries as insisted by the complianant he issued 19 blank signed cheques, besides other blank signed papers. It is the further case of the accused that he had settled the account connected with the said Crl. Appeal 107/2000 8 kury transaction and when demanded for return of the blank cheques the complainant retured only 6 blank cheques and the remaining were kept by him. According to the accused attempt was made to get back those remaining cheque leaves at the intervention of mediators but the same has resulted in the failure and such attempt on the part of the accused preferred the complainant to file the present case. Thus, according to the accused Ext.P1 is one of the said cheque leaves entrusted with the complainant connected with the kury transaction which he misused for the purpose of filing the present case. During trial the accused examined himself as D.W.1 and examined another witness as D.W.2. Exts.D1 and D2 are also produced as defence exhibits. Ext.D1 is one among the six cheques alleged to have returned by the complainant which he obtained earlier from the accused at the time of the kury transaction. Ext.D2 is the stop memo issued by the accused directly to his bank authorities to stop the payment in case the cheques mentioned therein come for encashment. On the basis of the above materials, the learned counsel for the accused submitted that the finding arrived at by the court below is legally and factually correct as the same is supported by materials. Supporting the finding of Crl. Appeal 107/2000 9 the trial court the learned counsel further submitted that by producing the materials by the accused and by making use of the evidence and materials that came out through the evidence of the complainant the defence has succeeded in establishing a probable case and thereby rebutted the presumption available under Section 139 of the N.I. Act in favour of the appellant-complainant. 10. In this juncture it is relevant to note that as pointed out earlier the specific case of the complainant was that Ext.P1 cheque was issued in connection with a loan transaction. Such a contention was continued even after receiving Ext.P6 reply notice. But when the complainant was examined as P.W.1 he had to accept the transaction between the complainant and the accused connected with the kury transaction. The learned counsel after inviting my attention to Ext.P7 security application pointed out that even in Ext.P8 promisory note there is endorsement regarding the acceptance of blank cheques produced above. When the complainant was examined he had also submitted that the cheques might have been obtained from the accused in part of the kury transaction. From the above approach of the complainant, I am of the opinion that the main case of the complainant was broken and Crl. Appeal 107/2000 10 the complainant has failed to establish beyond reasonable doubt regarding the loan transaction between the complainant and the accused. From the above approach of the complainant, I am of the opinion that the main case of the complainant was broken and the complainant has failed to establish beyond reasonable doubt regarding the loan transaction between the complainant and the accused. The trial court, on the basis of the materials and evidence came to the conclusion that an amount of Rs.36,000/- (Rupees thirty six thousand only) is due from the accused on the date of Ext.P1. The trial court has also found that though the complainant has claimed that there were witnesses to Ext.P8 none of them were examined and also found that signatures of the accused in Ext.P8 and the vakalath are different. Thus, it is found that no amount was due to the complainant from the accused. From the very beginning the case of the defence is to the effect that the cheque in question was handed over to the complainant connected with the kury transaction and he issued Ext.D2 stop memo when the complainant failed to return the blank cheques which obtained from the accused connected with the transaction. Therefore, I am of the view that the cheque in question was Crl. Appeal 107/2000 11 dishonoured at the instance of the accused and not for the reason of insufficiency of funds in the account. Therefore, the accused by adducing cogent and concrete evidence it is established that there was no legal transaction between the complainant and the accused and if no amount was due from the accused towards the complainant and he did not execute Ext.P1 cheque and issued the same towards the discharge of any debt. Therefore, the finding arrived at by the court below cannot be held as perverse or illegal or without considering the materials and evidence on record. Consequently no interference is warranted. In the result the appeal is devoid of any merit and the same is dismissed. There will be no order as to costs. V.K.MOHANAN JUDGE jj