IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.P.BALACHANDRAN WEDNESDAY, THE 12TH MARCH 2008 / 22ND PHALGUNA 1929 CRL.A.No.42 of 2008 (A) ----------------------------- AGAINST THE ORDER IN CRL.L.P.1199/2007 CRL.A.310/2006 of SESSIONS COURT, KOTTAYAM .................... APPELLANT/RESPONDENT/COMPLAINANT: -------------------------------------------------- V.K.SOMAN ACHARY, VELLAPPALLIL HOUSE, NEENDOOR, ONAMTHURUTHU, KOTTAYAM. BY ADV. SRI.M.J.THOMAS RESPONDENTS: APPELLANT/ACCUSED AND STATE: ----------------------------------------------------------- 1. M.P.PRABHAKARAN, MAROOR THEKKETHIL VEEDU, NEENDOOR, ONAMTHURUTHU, KOTTAYAM. 2. STATE OF KERALA REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM. BY ADV. SRI.S.ANIL KUMAR (CHERTHALA) SRI.T.R.MOHANAKUMAR PUBLIC PROSECUTOR SRI.P.RAVINDRA BABU THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 12/03/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K.P.BALACHANDRAN, J. ------------------------------------------------ Crl. Appeal No.42 of 2008 ------------------------------------------------ Dated this the 12th day of March, 2008 JUDGMENT This is appeal filed with leave by the complainant in C.C.470/05 on the file of the Judicial First Class Magistrate's Court-I, Kottayam assailing the judgment of acquittal passed by the Sessions Judge, Kottayam in appeal filed by the first respondent as Crl.A.310/06 whereby the first respondent was acquitted of offence under Section 138 of the N.I. Act allowing the appeal. 2. The appellant filed complaint before the Chief Judicial Magistrate's Court, Kottayam alleging that an amount of Rs.60,000/- was due to him from the first respondent that being amount borrowed by the first respondent from him and in order to make repayment of the said amount the first respondent issued Ext.P1 cheque dt.16/07/04 drawn on his account at the Neendoor branch of Crl. Appeal No.42 of 2008 -2- the State Bank of Travancore for Rs.60,000/- in discharge of the said debt; that on presentation of the cheque for encashment, it was returned dishonoured by the drawee bank on 17/07/04 under Ext.P2 memorandum for reason of “insufficiency of funds” in the account of the first respondent to honour the said cheque; that thereupon the original of Ext.P4 notice was issued to the first respondent through lawyer intimating him of the dishonour of the cheque and calling upon him to make payment of the amount covered by the cheque; that the said notice was received by the first respondent under Ext.P6 postal acknowledgment card on 26/07/04, but he has not issued any reply to the said notice nor has he paid up the amounts covered by the cheque either within the statutory period or ever thereafter and thus, he has committed an offence punishable under Section 138 of the N.I. Act. Crl. Appeal No.42 of 2008 -3- 3. The learned Chief Judicial Magistrate recorded the sworn statement of the appellant; took cognizance of the offence under Section 138 of the N.I. Act and registered the case as S.T.1012/04 on the file of his court. Thereafter, the case was made over to the Judicial First Class Magistrate's Court-I, Kottayam where the case was refiled as C.C.470/05. On appearance of the first respondent in the court below, he was served with copies of all relevant records in the case and he was questioned by the Magistrate reading over the particulars of the offence and explaining it to him. Thereupon, he pleaded not guilty and consequently, a trial of the case was conducted by the court below. 4. On the side of the appellant/ complainant, he got himself examined as PW1 and got marked in evidence on his side Exts.P1 to P8. On the appellant closing his evidence, the first respondent was questioned by the Crl. Appeal No.42 of 2008 -4- court below under Section 313 Cr.P.C. Thereupon, he generally denied all incriminating circumstances appearing in evidence against him and maintained that he is innocent. According to him, he had availed of a loan of Rs.35,000/- from the the appellant on 30/08/03 delivering a blank signed cheque and a blank signed stamp paper; that in ten months a total amount of Rs.69,500/- was repaid; that even prior thereto the appellant had purchased an almirah from his shop paying an amount of Rs.2,000/- only and setting off Rs.500/- as against interest and the balance Rs.2,300/- was recovered from the appellant lodging complaint before the Circle Inspector of Police, Ettumanoor. 5. On the defence side, the first respondent got himself examined as DW1 and he also examined DW2 as witness on his side and got marked in evidence Exts.D1 to D5. Crl. Appeal No.42 of 2008 -5- 6. The learned Magistrate considered the case in the light of the evidence adduced as aforesaid; found the first respondent guilty of offence punishable under Section 138 of the N.I. Act; convicted him thereunder and sentenced him to undergo simple imprisonment for three months and to pay an amount of Rs.60,000/- by way of compensation to the complainant under Section 357(3) Cr.P.C. 7. On appeal by the first respondent, the Sessions Court, Kottayam vide judgment in Criminal Appeal No.310/06 dt.05/07/07 reversed the said conviction and sentence and acquitted the first respondent of offence under Section 138 of the N.I. Act holding that there is no convincing evidence or circumstance to prove that Ext.P1 cheque was issued in discharge of debt or other liability legally due from the first respondent and that the first respondent has not executed the cheque in the manner alleged by the appellant. Hence, this appeal Crl. Appeal No.42 of 2008 -6- by the aggrieved appellant. 8. It is contended before me by the learned counsel for the appellant that the fact of dishonour of Ext.P1 cheque as being for reason of “insufficiency of funds” in the account of the first respondent as also the compliance of all statutory requirements which are pre-requisites for the maintainability of a complaint under Section 138 of the N.I. Act are not in dispute in the instant case; that the first appellate court was interfering with the conviction entered into by the learned Magistrate improperly without appreciating the entire circumstances that has come out in evidence and that therefore, the acquittal of the first respondent by the appellate court vide judgment assailed deserves to be reversed allowing this appeal. 9. I have heard arguments of counsel on both sides and they have taken me through the entire evidence adduced in the case for a re- Crl. Appeal No.42 of 2008 -7- appraisal of the case. Ext.P1 is cheque drawn on an account maintained by the first respondent at the Neendoor branch of the State Bank of Travancore and is one signed by him as proprietor of “S & S Home Appliances”, a business concern run by him. Ext.P2 shows that the cheque was dishonoured for reason of “insufficiency of funds” by the drawee bank and Ext.P3 shows that the collecting bank has returned therewith Ext.P1 cheque along with Ext.P2 dishonour memorandum to the appellant on 17/07/04. Ext.D2 is the F.I.R registering Crime No.293/04 of Ettumanoor Police Station for offence under Sections 341, 294(b) and 323 IPC registered on 17/07/04 and is accompanied by the F.I. Statement given by the first respondent on whose complaint is the said crime registered. The complaint is one against the appellant for his having caused bodily harm to the first respondent wrongfully restraining him and abusing him for reason of Crl. Appeal No.42 of 2008 -8- non-payment of penal interest in connection with a loan availed of from the appellant by the first respondent. Ext.D3 is the Final Report in the said case charge sheeting the appellant for the offences alleged. Ext.D4 is complaint filed by the first respondent against the appellant before the Secretary of Headload and General Workers Union, Neendoor on 15/07/04 complaining of harassment from the appellant demanding a further amount of Rs.15,000/- by way of penal interest after his having discharged the entire loan amount of Rs.35,000/- received from him by way of loan with interest. Ext.D1 is action taken in that behalf against the appellant who is a headload worker by the Secretary of Headload and General Workers Union, Neendoor. Ext.D5 is also a complaint filed by the first respondent before the District Secretary of the Communist Marxist Party on 30/07/04 and Ext.D6 is copy of a complaint filed by the first respondent Crl. Appeal No.42 of 2008 -9- before the Chief Minister of the State. 10. The appellant/complainant has filed proof affidavit swearing to his case as alleged in the complaint. In cross examination he has stated that he is a headload labourer; that amount was borrowed from him by the first respondent on 15/07/03 without any record whatsoever, the first respondent being his neighbour that the amounts so paid to the first respondent is cash which he was keeping in his hand for the purchase of property and not amount withdrawn from the bank; that however, there was no agreement entered into for purchase of property; that he had sold ornaments of twelve sovereigns belonging to his wife and that on 15/07/04, the first respondent issued Ext.P1 cheque dt.16/07/04 in discharge of the said debt. He has admitted that he is not aware as to who has filled up the entries in the cheque as the cheque was being brought by the first respondent duly Crl. Appeal No.42 of 2008 -10- written up. According to PW1, the cheque was being issued to him after one year of advancing of the loan and on prior occasions also the first respondent used to avail of loans from him. According to PW1, pursuant to complaint filed before the Secretary of the Headload & General Workers Union, he was prohibited from doing headload work vide Ext.D1 letter issued by the Secretary and thereafter it is pursuant to orders of this Court that he could do headload work. He further admits that on allegation of the first respondent having been manhandled, case had been registered against him and also that the Circle Inspector of Police had got him down to the Police Station. According to PW1, he had purchased household articles from the shop of the first respondent and that was an almirah and there is no bill in relation to the said purchase. The suggestion made to PW1 in cross examination that an amount of Rs.35,000/- was Crl. Appeal No.42 of 2008 -11- availed of as loan from him on 30/08/03 by the first respondent and then a blank signed cheque had been entrusted with him is denied by him. He has also denied the suggestion that consequent on failure to make payment of penal interest as demanded, he was manipulating the blank signed cheque leaf into Ext.P1 and filing the complaint. From the evidence of PW1 himself, it has come out that the first respondent used to avail of loans from him even earlier. This probabilises the suggestion and the case set up by the first respondent that Ext.P1 cheque is one made up on a blank signed cheque leaf entrusted with him at the time of availing of loan on an earlier occasion. There is absolutely no evidence to establish that the appellant was in possession of an amount of Rs.60,000/- to be advanced on 15/07/03 to the first respondent as is the case alleged by him. All the same, according to the appellant Rs.60,000/- was being Crl. Appeal No.42 of 2008 -12- advanced without any record whatsoever and it is only after one year that the first respondent issued Ext.P1 cheque. PW1 has admitted that there is no witness to the transaction. The purchase of almirah from the shop of the first respondent is also admitted by PW1. The first respondent has explained in his testimony as DW1 in cross examination when confronted with the factum of non- issuance of reply to Ext.P4 notice that he was prepared to settle the transaction with the appellant paying up also the penal interest claimed by him and that was why he did not issue any reply. The evidence of DW2 the Secretary of the Headload and General Workers Union, Neendoor is however, acceptable to the extent of his proving Exts.D1, D4 and D5. Thus, on the whole, apart from the solitary testimony of PW1/the appellant there is absolutely no evidence in the case that there existed a debt which the first respondent was legally bound Crl. Appeal No.42 of 2008 -13- to discharge; that the liability was to the extent of Rs.60,000/- as alleged or that it was in discharge of the said liability that Ext.P1 cheque was issued by the first respondent. At the same time, the probability of the truth of the defence contention as regards the circumstance under which he happened to issue a blank signed cheque stands established even on the testimony of PW1 who admits that even on prior occasions the first respondent had availed of loan from him. It has prima facie come out in evidence from Exts.D2 and D3 that the appellant had voluntarily restrained the first respondent and caused him bodily harm on 17/07/04 the date which Ext.P3 letter bears. Even in Ext.D2 F.I.statement given by the first respondent, the contention that he has taken up in this case is the reason stated as motive for the assault. Whereas the present complaint is filed by the appellant before the Magistrate Crl. Appeal No.42 of 2008 -14- only on 24/08/04. It is worthy to note that Ext.D4 filed before the Secretary of Headload and General Workers Union, Neendoor by the first respondent is on 15/07/04 before the dishonour of Ext.P1 cheque and the correctness of the date of Ext.D4 as being 15/07/04 is highly probabilised also when Ext.D1 admitted by PW1 as being the letter issued by the Secretary of the Headload and General Workers Union, Neendoor to him is dt.17/07/04. Thus, it is in evidence that even before dishonor of Ext.P1 cheque the first respondent was complaining of the attempts made by the appellant for realising further amounts from him by way of penal interest in relation to a loan transaction of Rs.35,000/- availed of by him on 30/08/03. Thus, the preponderance of probabilities suggest that the contentions raised by the first respondent that Ext.P1 was being made up by the appellant manipulating a blank signed cheque entrusted with him by way Crl. Appeal No.42 of 2008 -15- of security by the first respondent when he availed of loan of Rs.35,000/- on 30/08/03 is true, as has been found by the first appellate court. It is also worthy to cite in this context the decision of the Apex Court in Krishna Janardhan Bhat v. Dattatraya G. Hegde (2008(1) KHC 410 SC) to the effect that the existence of debt or the existence of a legally recoverable debt is not a matter of presumption under Section 139 of the N.I. Act, but it merely raises a presumption in favour of the holder of the cheque that the same has been issued for discharge of any debt or other liability. In the instant case, the existence of any debt or legally recoverable debt does not stand established on the evidence of the appellant. On the other hand, what stands highly probabilised is the defence contention that Ext.P1 cheque is one made up on a blank signed cheque leaf entrusted with the appellant by way of security while availing of a loan on a Crl. Appeal No.42 of 2008 -16- prior occasion in 2003. In the circumstances, I am of the view that this appeal is devoid of any merit and that this appeal deserves only to be dismissed confirming the acquittal of the first respondent of the offence punishable under Section 138 of the N.I. Act by the Sessions Judge. 11. In the result, confirming the correctness of the acquittal of the first respondent of offence under Section 138 of the N.I. Act vide judgment impugned, I dismiss this Criminal Appeal. K.P.BALACHANDRAN, JUDGE kns/-