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. 479 of 2004(C) ------------------------ AGAINST THE JUDGEMENT/ORDER IN CRLP.43/2004 Dated 21/01/2004 CC.952/2001 of JUDL.MAGISTRATE OF FIRST CLASS-III, PUNALUR .................... APPELLANT(S): COMPLAINANT ------------------------- THOMAS CHACKO, S/O.CHACKO, SAM BHAVAN, KUTHIRACHIRA, PUNALUR. BY ADV. SRI.THOMAS M.JACOB SRI.G.RAJAGOPAL SMT.RENJINI DEVI.N. RESPONDENT(S): --------------- 1. K.U.MATHEW, S/O.VARGHESE, KIZHAKKETHIL HOUSE, OTTACKAL, THENMALA. 2. STATE OF KERAL, REPRESENTED BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA. PUBLIC PROSECUTOR SMT.M.K. PUSHPALATHA FOR R2 SRI.REJI MATHEW KAVALAYIL FOR R1 SRI.BIJU GEORGE FOR R1 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. 479 of 2004 - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 21st day of December, 2010 JUDGMENT This appeal is filed by the complainant in C.C.No. 952 of 2001 on the file of the Judicial First Class Magistrate Court - III, Punalur. 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 appellant/complainant is as follows. The accused issued to the complainant a cheque dt.30.3.2001 for an amount of Rs.37,000/- from his account maintained at the Canara Bank, Punalur branch, in discharge of his liability towards the complainant. When the cheque was presented for incashment, it was dishonoured due to insufficiency of funds in the account of the accused, vide memo dt. 25.5.2001. The complainant sent a lawyer notice dt. 6.6.2001 Crl.A. No. 479 of 2004 2 to the accused intimating the dishonour of the cheque and demanding back the amount. But 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 P5 were marked. No evidence was adduced from the defence side. The learned Magistrate, on considering the evidence, found that the complainant failed to establish that Ext.P1 cheque was issued by the accused to the complainant in discharge of a legally enforceable debt and the accused was 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. At the time of argument, learned counsel for the appellant raised the following contentions. Learned counsel submitted that the finding of the court below that Ext.P1 cheque was obtained by the complainant as blank cheque is not based on any material evidence. Crl.A. No. 479 of 2004 3 The specific case of the complainant is that Ext.P1 cheque was written and signed by the accused. No contra evidence was adduced by the accused. Hence the court below erred in holding that Ext.P1 cheque was obtained as blank cheque. 6. The court below erred in holding that the complainant has admitted in cross examination that there is only one transaction between the complainant and the accused. But the specific case of the complainant is that the accused has taken more than one loan from him and that there are more than one transaction. It has come out in evidence that the blank cheque was given as security for another amount of Rs.60,000- due from the accused to the complainant. Merely because blank cheque was issued for another transaction, it cannot be presumed that Ext.P1 cheque was also issued blank, as it is asserted by the complainant that Ext.P1 cheque was written and signed by the accused. No contra evidence was adduced by the accused. 7. The court below erred in holding that the complainant admitted that the blank cheque was kept to pressurise the accused. No Crl.A. No. 479 of 2004 4 such admission was made by the complainant. Instead, he submitted that the blank cheque was given as security for another transaction. The court below erred in holding that the complainant has not proved execution of the cheque. The signature of the accused is not disputed by the defence. Merely because the defence suggested that Ext.P1 cheque was issued blank, it cannot be held that the complainant failed to prove execution of the cheque. The court below ought to have held that the accused has not rebutted the presumption under Sections 118 and 139 of the N.I. Act. The learned counsel for the first respondent supported the judgment of the court below. 8. When the accused was questioned under Section 313 Cr.P.C., his case was that no amount was due from him to the complainant and that the case is a fabricated one. 9. The complainant was examined as PW1. He deposed that the accused borrowed Rs.37,000/- from him and when he demanded back that amount, the accused issued Ext.P1 cheque dt. 30.3.2001. PW1 presented that cheque for incashment and it was dishonoured Crl.A. No. 479 of 2004 5 due to insufficiency of funds in the account of the accused. The complainant sent a lawyer notice to the accused intimating the dishonour of the cheque and demanding back the amount. Inspite of receipt of notice, the accused did not reply any amount. Ext.P2 is the dishonour memo. Ext.P3 is the copy of the lawyer notice, Ext.P4 is the postal receipt and Ext.P5 is the postal acknowledgment. In cross examination PW1 specifically stated that the entries in Ext.P1 cheque were made by the accused in his presence and that the accused put his signature also in his presence. 10. PW1 deposed that after this transaction the accused borrowed Rs.60,000/- from him and as security for the repayment of that amount the accused gave two blank signed cheques and a blank signed stamp paper. From that admission of PW1 it cannot be inferred that Ext.P1 cheque was also a blank signed cheque. The accused has not gone to the witness box to establish that when he gave Ext.P1 cheque it was a blank signed cheque. In the absence of such evidence, the testimony of PW1 that Ext.P1 cheque was executed by the accused Crl.A. No. 479 of 2004 6 has to be accepted as true. Since execution of Ext.P1 cheque is proved, the presumption under Sections 118 and 139 of the Act would apply and it is for the accused to rebut that presumption. The accused has not produced any evidence to rebut that presumption. 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.40,000/- would meet the ends of justice. Crl.A. No. 479 of 2004 7 13. Accordingly this appeal is allowed. The judgment of acquittal in C.C.No. 952 of 2001 on the file of the Judicial First Class Magistrate -III, Punalur 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.40,000/- 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) Judge tm