IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE V.K.MOHANAN TUESDAY, THE 20TH SEPTEMBER 2011 / 29TH BHADRA 1933 CRL.A.No. 1316 of 2003() ------------------------ CC.8/1999 of JUDL. MAGISTRATE OF FIRST CLASS-III, KOZHIKODE .................... APPELLANT: --------------- N. VIJAYARAJAN, POWER OF ATTORNEY HOLDER, M/S. SABARIKA SAREES, KEVE COMPLEX, CALICUT. BY ADV. SRI.P.V.KUNHIKRISHNAN RESPONDENT: ------------------- 1. P. RANGASWAMY, SUBALAKSHMI 'TEXTILE DEALERS', ATTINGAL. 2. STATE OF KERALA REP. BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA. ADV. SRI.M.R.RAJESH FOR R1 R2 BY PUBLIC PROSECUTOR SRI P.A. SALIM. THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 20/09/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: V.K.MOHANAN, J. ---------------------------------------- Crl.A. No. 1316 of 2003 ---------------------------------------- Dated the 20th day of September , 2011 JUDGMENT The complainant in a prosecution for the offence under section 138 of the Negotiable Instrument Act is the appellant. 2. The case of the complainant is that the accused was one of the customers of the complainant and on 4.5.1996, the accused had business transaction with the complainant and purchased clothes from the complainant and subsequently on 12.6.96, the accused returned some clothes worth of Rs.1,46,300/- to the complainant and the accused came to the complainant's shop and issued two cheques for Rs.50,000/- each dated 4.8.96 and 23.8.96 and when the above cheques presented for encashment, the same were returned for the reason 'account closed'. According to the complainant, though a formal demand notice was sent to the accused, the accused has not repaid the amount in spite of the receipt of such notice and thus, according to the complainant, the accused has committed the offence punishable under section 138 of the Act. CRA 1316/03 -2- With the above allegation, the complainant approached the court of Chief Judicial Magistrate, Kozhikode by filing a complaint and the learned Magistrate took cognizance for the said offence and instituted S.T.No.3/97 and on appearance of the accused and the proceedings were in progress, the case was made over to the present trial court wherein the case is renumbered as C.C.No.8/99. During the trial of the case, on behalf of the complainant, PW1 was examined and produced Exts.P1 to P10. No evidence is adduced from the side of the defence. The trial court finally found that the complainant has failed to establish that the accused has committed the offence as alleged and therefore the accused is acquitted under section 255(1) Cr.P.C. It is the above finding and order of acquittal challenged in this appeal. 3. I have heard Sri P.V. Kunhikrishnan, the learned counsel for the appellant and Sri M.R.Rajesh, the counsel for the Ist respondent. 4. Sri P.V. Kunhikrishnan, the learned counsel for the appellant vehemently submitted that the trial court is wrong in holding that the complainant has not established the case, on CRA 1316/03 -3- the observation that PW1 has no direct knowledge regarding the transaction between the Managing Partner of the complainant and the accused. It is also the submission of the learned counsel that the complainant is entitled to get the presumption under section 139 and 118 of the NI Act but the learned Magistrate refused to draw such statutory presumption in favour of the complainant. It is also the submission of the learned counsel that the trial court is wrong in holding , especially, in the light of Ext. P10 that, since the accused is not the person who maintained the account from which the cheques were drawn, no offence under section 138 of the NI Act is attracted. The learned counsel also submitted that, if this court is inclined to remand the matter with liberty to adduce evidence on the behalf of the complainant, the complainant can substantiate his case and thereby cure the defects pointed out by the trial court. 5. On the other hand, the counsel appearing for the Ist respondent submitted that the reasoning given by the learned Magistrate in acquitting the accused deserves no interference. According to the learned counsel, the finding of the learned CRA 1316/03 -4- Magistrate that PW1 has no direct knowledge regarding the transaction is absolutely correct and there is no contra evidence to come to a different view. It is also the submission of the learned counsel for the Ist respondent that, the prosecution has miserably failed to prove that the cheques in question are pertained to the account maintained by the accused and therefore, the essential ingredients of section 138 of the N.I Act is not attracted. 6. I have carefully considered the arguments advanced by the learned counsel for the appellant as well as the Ist respondent and I have also perused the judgment of the trial court and the evidence and materials on record. 7. On a scanning of the judgment of the trial court, it can be seen, especially, in the light of the deposition of PW1 that, PW1 has no direct knowledge regrading the transaction entered into between the Managing Partner of the complainant and the accused. Absolutely there is no evidence with respect to the terms and conditions which govern the transaction. In the absence of any positive evidence regarding the terms and conditions of the transaction, I am unable to understand as to CRA 1316/03 -5- why the complainant received two cheques for a total sum of Rs.1,00,000/-, when the due amount is Rs.1,22,969/- . During the cross examination of PW1, the answers given were evasive in nature and that itself is sufficient to hold that he had no sufficient knowledge regarding the transaction and the terms and conditions which fix the right and liability of the parties to the transaction. So according to me, the learned Magistrate is fully justified in his finding that PW1 has no direct knowledge regarding the transaction and the complainant has withheld the best evidence from the scrutiny of the court. 8. Another ground, on the basis of which the learned Magistrate acquitted the accused, is the absence of evidence to show that Ext.P3 and P4 cheques are pertaining to the account maintained by the accused. The trial court after evaluation of the evidence, particularly Ext.P10, has held that, Ext.P10 is the ledger extract of account No.363 which opened and maintained by one Roop kumar. It is on the basis of the above materials, the trial court held that the account to which Exts.P3 and P4 cheques pertained is not maintained by the accused. The above materials and findings are sufficient to CRA 1316/03 -6- hold that the complainant has miserably failed to establish the essential ingredients of Section 138 of the NI Act. That being the position, even if the matter is remanded back to the trial court, there is no scope for any prospective prosecution. In the light of the above discussion and in view of the materials referred to above, I am of the view that the learned Magistrate is fully justified in his finding and the order of acquittal recorded by him. Therefore, there is no merit in the appeal and accordingly, the same is dismissed. V.K. MOHANAN, JUDGE kvm/- CRA 1316/03 -7- CRA 1316/03 -8-