IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MRS. JUSTICE M.C.HARI RANI WEDNESDAY, THE 29TH JUNE 2011 / 8TH ASHADHA 1933 CRL.A.No. 517 of 2002 ----------------------- ST.8067/1998 of JUDL. MAGISTRATE OF FIRST CLASS COURT, IRINJALAKUDA .................... APPELLANT/COMPLAINANT: ------------------------- REGHULAL S/O.KUMARAN,KARIYANGATTU HOUSE, PULLUT DESOM,KODUNGALLOOR BY ADV. SRI.DINESH R.SHENOY RESPONDENTS: ACCUSED ---------------------- 1. ANILA W/O.RAMAN,MENOTH HOUSE, NEAR AKP JUNCTION,IRINJALAKUDA. 2. STATE OF KERALA,REPRESENTEDM BY THE PUBLIC PROSECUTOR,HIGH COURT OF KERALA. ADV. SRI.M.C.GOPI FOR R1 SRI.T.MANOJ BY PUBLIC PROSECUTOR MR. PUZHAKKARA MUHAMMED THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 01/06/2011,THE COURT ON 29/06/2011 DELIVERED THE FOLLOWING: M.C. HARI RANI, J. ====================== CRL.APPEAL NO. 517 OF 2002 ======================= Dated this the 29th day of June 2011 JUDGMENT The complainant in S.T. No.8067/1998 on the file of the Court of Judicial First Class Magistrate, Irinjalakuda is the appellant. The complaint was filed against the first respondent herein complaining of commission of the offence punishable under Section 138 of the Negotiable Instruments Act. The learned Magistrate acquitted the accused as per judgment dated 24/10/2001 with the finding “there is no legal proof to find out that a notice demanding payment of the dishonoured cheque has been given”. This finding has been challenged by the complainant/appellant by filing this appeal. CRA.517/20002 -2- 2. The case of the complainant is as follows: The accused/first respondent received Rs.80,000/-from the complainant for arranging a VISA to him. When demand was made to return back that amount, Ext.P1 cheque was issued on 10/3/1998. That cheque when presented for collection through the Bank was dishonoured for the reasons 'payment stopped by the drawer on 17/3/1998 and funds insufficient' as revealed from Ext.P2. Thereafter, the complainant issued Ext.P6 lawyer notice dated 21/3/1998 to the accused demanding payment of the cheque amount which was received by the accused on 24/3/1998. She sent a reply lawyer notice marked as Ext.P5 raising false allegations. In spite of receipt of the lawyer notice, the cheque amount has not been paid. Accordingly, the complaint was filed by the complainant before the learned Magistrate on 11/5/1998 wherein it was complained by the complainant/appellant that the accused has committed the offence under Section 138 of the Negotiable Instruments Act. The learned Magistrate taken cognizance of the complaint and proceeded with the case. On receipt of the CRA.517/20002 -3- summons issued from the court, the accused appeared and pleaded not guilty. Thereafter, evidence was adduced by the complainant. The complainant was examined as PW1 and Exts.P1 to P8 were marked. No evidence whatsoever either orally or documentary has been adduced on the side of the defence. 3. The defence set up by the accused as revealed from the cross examination of PW1 as also 313 examination was that the disputed cheque was not given by her to the complainant and the signature in the cheque was obtained from her house on threatening her. The learned Magistrate after considering the evidence adduced in this case found that the contention of the accused that Ext.P1 cheque was given as a security for the amount given for arranging VISA and that presumption under Section 139 of the Negotiable Instruments Act was in favour of the complainant. The learned Magistrate acquitted the accused with the finding that no evidence has been adduced by the complainant to prove that as per Ext.P6 lawyer notice, no demand has been made for payment of the dishonoured cheque amount. CRA.517/20002 -4- 4. Thus the only point for consideration in this appeal is regarding the demand if any made by the complainant for payment of the amount covered under the disputed cheque. 5. It is argued by the learned counsel appearing for the appellant that on a perusal of Ext.P6 lawyer notice it is evident that a specific demand has been made by the complainant for repayment of the cheque amount of Rs.80,000/- within 15 days from the date of receipt of the notice. In spite of that demand, the amount has not been paid by the accused as deposed by the complainant when examined as PW1. The reply lawyer notice sent by the accused was also produced by the complainant which was marked as Ext.P5. The contention of the appellant has been opposed by the learned counsel for the first respondent/accused and submitted that there is no ground for interference with the impugned judgment of acquittal passed by the learned Magistrate. 6. In the light of the contentions raised by the parties, it will be advantageous to extract the relevant provisos (b) and (c) appended to Section 138 and also Section 142(b) of the Negotiable Instruments Act. CRA.517/20002 -5- 138. Dishonour of cheque for insufficiency, etc., of funds in the account:- xx xx xx Provided that nothing contained in this section shall apply unless - (a) xx xx xx (b) the payee or the holder in due course of the cheque, as the case may be makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within fifteen days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and (c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice.” xx xx xx xx xx xx 142. Cognizance of offences.- xx xx xx xx xx xx (b) such complaint is made within one month of the date on which the cause of action arises under clause (c) of the proviso to Section 138. CRA.517/20002 -6- 7. To constitute of an offence under Section 138 of the Negotiable Instruments Act, the notice of demand in writing on the part of the payee and the failure on the part of the drawer to pay the amount within a period of fifteen days of the receipt of the said notice have to be proved. 8. From the evidence adduced by the complainant before the lower court, it is evident that after receipt of the dishonour memo from the drawee bank, the complainant sent notice by Registered Post with A/D to the accused through his Advocate by letter dated 21/3/1998 demanding payment of cheque amount of Rs.80,000/- within 15 days from the date of receipt of the notice and also informed that appropriate legal actions will be taken in case of non-payment of the amount. The accused had admittedly received the aforesaid notice on 24/3/1998 as revealed from the acknowledgment card, Ext.P3 and a reply notice, Ext.P5 has been sent by the accused. In the reply notice and in the cross examination of PW1 no such contention has been raised by the accused to the effect that the notice issued by the complainant was not proper and that no demand has been made for repayment of the cheque amount. The only contention CRA.517/20002 -7- raised by the accused was that the signature in the disputed cheque was obtained by the complainant with force and on threatening her. Copy of the lawyer notice sent by the complainant, Ext.P6 and also the original reply notice, Ext.P5 would prove that sufficient demand as contemplated by the above-said provisions of the Negotiable Instruments Act has been made by the complainant and the complaint has been preferred against the accused only after proper demand made for return of the cheque amount and due to failure on the part of the accused to repay that amount within 15 days as demanded in the lawyer notice. The finding of the learned Magistrate that 'there is no legal proof to find out that a notice demanding payment of the dishonoured cheque has been given' was only an inventure which cannot be supported and should be interfered with. No further legal proof is necessary to prove the demand for repayment of the cheque amount. In spite of the lawyer notice issued at the instance of the complainant which was admittedly received by the accused, the amount has not been paid but sent a reply notice contending about the genuineness of the claim. Thereafter, the complaint has been preferred by the complainant within the statutory period which was correctly CRA.517/20002 -8- taken cognizance by the learned Magistrate. 9. Under the provisions of Clause(c) of Section 138 of the Negotiable Instruments Act, the cause of action for filing the complaint arises on the failure of the drawer to make payment of the said amount of money covered under the cheque to the payee within 15 days of the receipt of the said notice given under clause (b) thereof and within the prescribed period as contemplated under Section 142(b) of the Act. No complaint can therefore be filed legally without complying the aforesaid requirements. In the case on hand, the complaint has been preferred by the complainant only after demand for payment of the cheque amount by issuing valid notice as provided and in accordance with the then provisions of the Negotiable Instruments Act, i.e.before the amendment, which is perfectly legal. Therefore, I find that the finding of the learned Magistrate regarding dismissal of the complaint filed by the appellant is liable to be set aside. The impugned judgment to that extent cannot be sustained and is set aside. 10. Accordingly, this appeal is allowed. The finding of the learned Magistrate that there is no evidence to prove that a demand for payment of dishonoured cheque amount has been CRA.517/20002 -9- made, is set aside. I find that the complaint was made by the complainant/appellant only after complying with the provisos (b) & (c) of Section 138 of the Act and also within the prescribed period under Section 142(b) of the Negotiable Instruments Act. The case is remanded back to the lower court. The learned Magistrate shall dispose S.T.No.8067/1998 afresh in accordance with the provisions of law within a period of two months from the date of receipt of the records of this case. The parties shall appear before the learned Magistrate on 18/7/2011. Send back the records to the court below immediately. M.C. HARI RANI JUDGE ks.