IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.S.SATHEESACHANDRAN TUESDAY, THE 31ST MARCH 2009 / 10TH CHAITHRA 1931 CRL.A.No. 276 of 2002() ----------------------- ST.2484/1997 of JUDL. MAGISTRATE OF FIRST CLASS-I, KOCHI .................... APPELLANT(S): COMPLAINANT: ------------------------------------------------ GODWIN PRODUCTS,THATTENKERY HOUSE, NARAKKAL P.O.,ERNAKULAM DISTRICT. BY ADV. MR.B.RAMACHANDRAN RESPONDENT(S): ACCUSED AND STATE: --------------------------------------------------------------- 1. FRANCIS T.D.@ THANKACHAN,PODIYARAM PARAMBIL HOUSE,NEAR APPANGAD BRIDGE,NARAKKAL P.O. ERNAKULAM DISTRICT. 2. STATE OF KERALA,REPRESENTED BY PUBLIC PROSECUTOR,HIGH COURT OF KERALA, ERNAKULAM. R2 BY PUBLIC PROSECUTOR SMT. PUSHPALATHA THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 26/03/2009, THE COURT ON 31/03/2009 DELIVERED THE FOLLOWING: Kss S.S. SATHEESACHANDRAN, J. - - - - - - - - - - - - - - - - - - - - - - - - - Crl.A.No.276 of 2002 - - - - - - - - - - - - - - - - - - - - - - - - - Dated: 31st March, 2009 JUDGMENT Complainant is the appellant. His complaint filed against the respondent/accused for the offence punishable under Section 138 of the Negotiable Instruments Act (for short 'the N.I.Act') ended in a judgment of acquittal in favour of the accused. Aggrieved by the judgment of acquittal, questioning its legality, propriety and correctness, he has filed this appeal. 2. The case of the complainant is that towards discharge of a loan transaction the accused issued Ext.P1 cheque for Rs.30,000/-. The cheque presented for encashment was dishonoured due to insufficiency of funds in the account of the accused. Statutory notice issued intimating dishonour and demanding the sum covered by the cheque was acknowledged by the accused, but not responded with any reply or payment. The complainant, thereupon filed the complaint to prosecute the accused for the offence punishable under Section 138 of the N.I.Act. The accused, on appearance, pleaded not guilty. The complainant examined himself as P.W.1 and got marked Exts.P1 to P5. During the cross examination of the complainant and also when questioned under Section 313 Cr.P.C., the accused advanced a Crl.A.No.276/02 - 2 - defence that Ext.P1 cheque had been collected by the complainant in blank form as security for payment of the kuri amount in a chitty conducted by his financial concern. The accused was a subscriber to a chitty and on pricing of the chitty to collect the price amount he had to furnish a blank signed cheque and, later, misusing it the complaint had been filed against him on false allegations. To substantiate his defence, the accused examined himself as D.W.1, and another as D.W.2 contending that he too was present when the cheque was handed over as security. He also produced a pass book relating to the chitty, which was exhibited as Ext.D1 in evidence. The learned Magistrate, after appreciating the materials produced, found that the defence set up by the accused was probable and convincing, and the case of the complainant far from truth. The learned Magistrate was not satisfied with the evidence adduced by the complainant that the accused had issued Ext.P1 cheque towards a debt or liability. In that view of the matter, the accused was found not guilty and he was acquitted of the offence imputed. 3. I heard the learned counsel for the appellant/complainant. There was no representation for the respondent/accused at the time of hearing. The learned counsel for the appellant assailed the judgment of acquittal rendered in favour of the accused as totally Crl.A.No.276/02 - 3 - unsustainable contending that wrong conclusions had been formed by the learned Magistrate misappreciating the evidence. Statutory presumptions available in favour of the payee under the cheque were not taken into account by the learned Magistrate in appreciating the materials produced in the case and that in effect had resulted in forming wrong conclusions leading to miscarriage of justice, submits the learned counsel. The accused had not sent a reply to the statutory notice issued by the complainant on dishonour of the cheque is pointed out by the counsel to contend that the defence advanced in the trial that the cheque was issued in blank form with signature alone as security for a chitty transaction with the complaint lacked credibility and it should have been discarded as unworthy of any value. The complainant had established his case that the cheque had been issued towards discharge of a loan availed from him, submits the counsel. In the above circumstances where all statutory formalities had been complied with for prosecution of the accused and execution of cheque in discharge of a debt proved, with the presumptions covered by the statute remaining unrebutted by the accused, it is urged, the judgment of acquittal rendered in favour of the accused is liable to be reversed and he should be convicted of the offence under Section 138 of the Act. Crl.A.No.276/02 - 4 - 4. I have perused the records of the case. The complainant, no doubt, is entitled to the statutory presumptions covered under Section 118 and also 139 of the N.I.Act if due execution of the cheque is proved. The admission by the accused that he had handed over a signed cheque in a blank form is not sufficient to hold that he had admitted execution of the cheque. The cheque arose from the account of the accused, it was dishonoured due to insufficiency of funds in his account and that he had not sent a reply to the statutory notice intimating dishonour, all these circumstances also are not sufficient to prove that there was due execution of the cheque to draw the presumptions covered by the statute. The complainant had comeforward with a case that he advanced a loan of Rs.30,000/- to the accused, and when a demand for repayment was made a month later the accused issued Ext.P1 cheque. But the materials produced in the case would show that the accused was a subscriber to a chitty in the financial concern managed by the complainant. At the relevant time when the loan transaction was extended to the accused on his request, it has come out from evidence of the complainant that the accused had defaulted in making payments after pricing the chitty. The evidence would show that a sum of Rs.22,000/- as defaulted amount was due from the accused. It was in that backdrop, the Crl.A.No.276/02 - 5 - learned Magistrate found that there was no possibility of the accused advancing any loan to the complainant without any security. Admitted case of the complainant is that no security was given when the loan was taken and the cheque was collected one month later. The accused had not sent a reply soon after the dishonour of the cheque when he was intimated of dishonour, does not assume much significance and that in no way prevent him from setting up his defence during the trial of the case. Of course, the merit of the defence set up in a trial without sending a reply after the receipt of the notice requires scrutiny. The learned Magistrate, after evaluating the materials produced, found that in weighing the case of the complainant with that of the accused, the defence canvassed by the accused is probable. Having regard to the fact that the complainant is admittedly a partner of a financial concern, which conducted the chitty prized by the accused, with subscription defaulted, later after prizing the chitty, it is hard to believe that he would have advanced any loan to the accused that too for a sum of Rs.30,000/- without collecting any security. The sworn testimony of the accused that the cheque was issued only as a security for collecting the chitty prized was found convincing to the learned Magistrate who had the opportunity to watch the demeanour and deportment of the accused Crl.A.No.276/02 - 6 - when he was examined as D.W.1. His evidence that the cheque was given as a security to the chitty amount was in the presence of another witness, P.W.2. Nothing has been brought out to show that D.W.2 had any interest in the accused so as to perjure in his favour before a court of law that he had witnessed the accused handing over the cheque to the complainant. So far as the accused is concerned, he need only show that his defence is probable. The learned Magistrate as already found that the defence canvassed by the accused in the present case was probable and convincing. After a careful scrutiny of the materials produced, I find no impropriety in the conclusion reached by the learned Magistrate in accepting the defence canvassed by the accused and holding that he was not guilty of the offence imputed. The acquittal of the accused passed by the learned Magistrate in such circumstances not liable to be interfered with. The appeal is dismissed. srd S.S. SATHEESACHANDRAN, JUDGE