IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.L.JOSEPH FRANCIS TUESDAY, THE 21ST DECEMBER 2010 / 30TH AGRAHAYANA 1932 CRL.A.No. 976 of 2004() ----------------------- AGAINST THE JUDGEMENT/ORDER IN CRLP.358/2004 Dated 14/06/2004 CC.232/2003 of JUDL.MAGISTRATE OF FIRST CLASS-I, THAMARASSERY .................... APPELLANT(S): COMPLAINANT. -------------------------- K.C.PADMANABHAN, S/O.CHATHUKUTTY CHETTIAR, AMBADY SOUTH MALORAM PUTHUPPADY, KOZHIKODE DISTRICT. BY ADV. SRI.T.G.RAJENDRAN RESPONDENT(S): ACCUSED AND STATE. --------------------------------- 1. T.N.PARAMESWARAN, JAPAN VIHAR, ELOKKARA P.O. 2. STATE OF KERALA, REP. BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM. ADV. SRI.P.V.KUNHIKRISHNAN FOR R1 R2 BY PUBLIC PROSECUTOR SMT. M.K. PUSHPALATHA THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 17/12/2010, THE COURT ON 21/12/2010 DELIVERED THE FOLLOWING: M.L. JOSEPH FRANCIS, J. - - - - - - - - - - - - - - - - - - - - - - - - - - Crl.A. No. 976 of 2004 - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 21st day of December, 2010 JUDGMENT This appeal is filed by the complainant in C.C.No. 232 of 2003 on the file of the Judicial First Class Magistrate Court - I, Thamarasserry. The first respondent herein was the accused in that case, which was filed by the complainant alleging commission of the offence under Section 138 of the N.I. Act. 2. Briefly the case of the complainant is as follows. The first respondent indebted to the complainant for a sum of Rs.2 lakhs, which was advanced to him as a personal loan. The payment was made out of a home loan availed by the wife of the complainant. . The accused issued a cheque dt. 10.2.2003 for the said amount. The cheque was presented on 14.4.2003 for incashment, but it was dishonoured due to insufficiency of funds in the account of the accused. The complainant sent a lawyer Crl.A. No. 976 of 2004 2 notice to the accused intimating the dishonour of the cheque and demanding back the amount. Even after receipt of the notice, the accused did not reply any amount. Hence the complaint. 3. In the Magistrate Court, on the side of the complainant, PW1 was examined and Exts.P1 to P6 were marked. On the defence side, Dws.1 to 4 were examined and Ext.D1 was marked. The learned Magistrate, on considering the evidence, found that the accused has rebutted the presumption under Section 139 of the N.I. Act and he was found not guilty and acquitted under Section 255(1) Cr.P.C. Against that judgment of acquittal the complainant filed this appeal. 4. Heard learned counsel for the appellant and the learned counsel for the first respondent. 5. The learned counsel for the appellant submitted that the specific case of the complainant is that his wife availed a house loan from Sundaram Finance Ltd., Kozhikode branch, from which the amount was given to the accused. The learned counsel for the appellant submitted that the court below ought not to have given Crl.A. No. 976 of 2004 3 importance to the date of giving of loan by the complainant as it was stated by him from his memory. The learned counsel for the appellant submitted that the court below ought to have noted that once execution of the cheque is admitted by the drawer, the presumption under Sections 118 and 139 of the N.I. Act would arise and the evidence adduced from the side of the accused is not sufficient to rebut that presumption. Learned counsel for the appellant submitted that since the complainant has proved all the necessary ingredients of the offence under Section 138 of the N.I. Act, the learned Magistrate is not justified in acquitting the accused. The learned counsel for the first respondent supported the judgment of the court below. 6. When the accused was questioned under Section 313 Cr.P.C., he stated that he owed some money to C.G. Raveendranath on account of purchase of gold. The complainant also had some liability. The accused stated that he voluntered to both of them that he would arrange to get old gold at slashed price. The accused as well as the said Raveendranath represented that they could generate funds upon signed Crl.A. No. 976 of 2004 4 blank cheques of the accused. Three of them signed a particular agreement for the same and the original of the agreement is with the complainant. 7. The complainant was examined as PW1. He deposed that the accused was his friend and that the accused borrowed Rs. 2 lakhs from him on 10.8.2002 for the purchase of a vehicle for his business purpose agreeing to repay the same within 15 days. Subsequently the accused sought four months time and even after that time the accused did not repay the amount. On 10.2.2003 the accused gave Ext.P2 cheque of South Malabar Gramin Bank, Puthuppadi branch for that amount. When PW1 presented that cheque for encashment, it was dishonoured due to insufficiency of funds in the account of the accused. 8. PW1 sent a lawyer notice to the accused intimating the dishonour of the cheque and demanding back the amount. Ext.P3 is the dishonour memo. Ext.P4 is the copy of the lawyer notice, Ext.P5 is the postal receipt and Ext.P6 is the postal acknowledgment. PW1 deposed that inspite of receipt of the notice, the accused did not repay Crl.A. No. 976 of 2004 5 any amount. Ext.P1 is the extract of cheque return register of South Malabar Gramin Bank, Puthuppady branch. The learned Magistrate, on considering the evidence, found that Ext.P2 cheque was drawn on the account maintained by the accused and that the complainant is entitled to get the benefit of the presumption under Section 139 of the N.I. Act. The learned Magistrate found that according to the version of PW1 he has given the loan amount to the accused on 10.8.2002 and the only source of the complainant was the home loan given by the Sundaram Finance Ltd., Kozhikode branch, which was obtained by the complainant only on 17.8.2002 and on that basis the presumption under Section 139 of the Act was rebutted by the accused. 9. DW4 Dileep is the officer in charge of Sundaram Finance Ltd., Kozhikode branch. He appeared before court on summons and stated that Rs.2.5 lakhs was sanctioned on 17.8.2002 and cheque was given on that day. Ext.D1 is the disbursement memo issued by Sundaram Home Finance Ltd., which shows that the cheque issued in favour of DW3 for Rs.2.5 lakhs was dt.19.8.2002. The date of issue Crl.A. No. 976 of 2004 6 of the disbursement memo is 17.8.2002. The disbursement date is 19.8.2002. At any rate, the amount has been passed to the hands of the complainant only after 17.8.2002. 10. DW3 is the wife of the complainant. She deposed that she is not having an account in the KDC bank, Thamarasserry. She stated that she had obtained the loan from Sundaram Finance Ltd. in the month of August, 2002. A cheque for Rs.2.5 lakhs was presented through the KDC bank, Thamarasserry and she withdrew Rs.2.5 lakhs from that bank in order to give to the accused. When DW3 was cross examined, she deposed that the statement of the complainant that he gave loan to the accused on 10.8.2002 is a mistake due to slip of memory of the complainant and that the complainant has no habit of noting down dates. From the testimony of DW3 it is clear that the date mentioned by the complainant as 10.8.2002 is due to his lapse of memory and as such much importance cannot be given to the date of borrowal as there is no dispute with regard to the execution of Ext.P2 cheque. Since the complaint is based on Ext.P2 cheque, the mere fact Crl.A. No. 976 of 2004 7 that the complainant mentioned a wrong date based on his memory, it cannot be said that the accused has rebutted the presumption under Section 139 of the N.I. Act. Therefore the learned Magistrate is not justified in acquitting the accused. 11. Since the complainant has proved all the essential elements of the offence under Section 138 of the N.I. Act, the learned Magistrate is not justified in acquitting the accused. As the accused committed the offence under Section 138 of the Act he is convicted for that offence. 12. In the decision reported in Damodar S. Prabhu v. Sayed Babalal H (2010(2) KHC 428 (SC)), it was held that in a case of dishonour of cheques, compensatory aspect of the remedy should be given priority over the punitive aspect. Considering the facts and circumstances of the case, I am of the view that sentencing the accused to pay a fine of Rs.2,00,000/- would meet the ends of justice. Crl.A. No. 976 of 2004 8 13. Accordingly this appeal is allowed. The judgment of acquittal in C.C.No. 232 of 2003 on the file of the Judicial First Class Magistrate -I, Thamarasserry is set aside and the accused is found guilty and convicted under Section 138 of the N.I. Act and he is sentenced to pay a fine of Rs.2,00,000/- The said fine shall be paid to the appellant as compensation under Section 357(1) of Cr.P.C. The accused is permitted either to deposit the fine amount before the court below or directly pay the compensation to the appellant within four months from today and produce a memo to that effect before the court below in case of direct payment. If the accused fails to deposit or pay the said amount within the aforesaid period, he shall suffer S.I. for a period of three months by way of default sentence. (M.L. JOSEPH FRANCIS) tm Judge Crl.A. No. 976 of 2004 9