IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.P.BALACHANDRAN WEDNESDAY, THE 2ND APRIL 2008 / 13TH CHAITHRA 1930 CRL.A.No. 405 of 2002 ------------------------------------- CC.886/1999 of JUDL.MAGISTRATE OF FIRST CLASS-I, SULTHANBATHERY .................... APPELLANT/COMPLAINANT: ---------------------- KARUNAKARAN, S/O.KANARI, MAROLIYIL VEEDU, CHOOTHUPARA, S. BATHERY TALUK. BY ADV. SRI.ESM.KABEER RESPONDENTS/ACCUSED: 1. THE STATE OF KERALA, REP. BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM. 2. P.K.SASI, S/O.KESAVAN, PONTHATHIL VEEDU, P.O.KOLERI, S.BATHERY. BY PUBLIC PROSECUTOR SRI.P.RAVINDRA BABU SRI.RAFFEEK.H.K THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 02/04/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K.P. Balachandran, J. --------------------------- Crl.A.No. 405 of 2002 --------------------------- JUDGMENT The complainant in C.C.No.886/99 on the file of the Judicial First Class Magistrate's Court-I, Sulthan Bathery is the appellant. He assails in this appeal the acquittal of the second respondent by the learned Magistrate of offence punishable under Section 138 of the Negotiable Instruments Act vide Section 255(1) Cr.P.C. 2. The appellant filed complaint in the court below alleging, inter alia, that himself and the second respondent are having acquaintance; that the second respondent, for the purpose of ginger cultivation, borrowed from him an amount of Rs.1,12,000/- on 11.3.1999, coming over to his house at Choothupara, undertaking to repay the amount on 29.9.1999 and he issued Exhibit P1 cheque in discharge of the said amount with date 29.9.1999 at the time of receiving the amount on loan; that when he presented the cheque for encashment before CRA 405/02 2 the drawee bank on 1.10.1999, it was returned dishonoured by the drawee bank under Exhibit P2 memorandum assigning the reason “funds insufficient”; that thereupon original of Exhibit P3 notice was issued to the second respondent through Lawyer on 8.10.1999 in compliance with proviso (b) to Section 138 of the Negotiable Instruments Act; that though the second respondent accepted the said notice, he has not repaid the amounts covered by the cheque either within the statutory period or ever thereafter nor has he issued any reply and thereby he has committed an offence punishable under Section 138 of the Negotiable Instruments Act. 3. The learned Magistrate recorded the sworn statement of the appellant and registered the complaint on the file of his court as C.C.No. 886/99, taking cognizance of the offence under Section 138 of the Negotiable Instruments Act. CRA 405/02 3 4. On appearance of the second respondent in the court below, pursuant to issuance of summons, he was served with copies of all relevant records in the case and was questioned by the learned 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. 5. On the side of the appellant/complainant, he got himself examined as PW1 and got marked in evidence Exhibits P1 to P7. On the complainant closing his evidence, the learned Magistrate questioned the second respondent 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 the second respondent, no amount is due to be paid by him to the appellant. However, he did not want to adduce any evidence in defence. CRA 405/02 4 6. The court below considered the case in the light of the evidence adduced as aforesaid; found that Exhibit P1 cheque is one issued by the second respondent to the appellant in discharge of a legally existing debt and that it was dishonoured for reason of insufficiency of funds in the account of the second respondent to honour the same, but, all the same, acquitted the second respondent consequent on its finding that no cause of action has arisen for the complaint, as the second respondent is not served with notice as mandated by proviso (b) to Section 138 of the Negotiable Instruments Act. Hence this appeal by the aggrieved appellant/complainant. 7. It is contended before me by the counsel for the appellant that original of Exhibit P3 notice was issued to the second respondent by the appellant through his Lawyer in time intimating him of the dishonour of Exhibit P1 cheque for reason of insufficiency of funds in his account and demanding CRA 405/02 5 payment of the amounts covered by the cheque; that the said notice was being addressed in the correct and complete address of the second respondent and despatch of the said notice is evidenced by Exhibit P4 postal registration receipt and that it is for reason that there is no signature of the second respondent in Exhibit P5 postal acknowledgment card the court below has come to the conclusion that notice is not actually served on the second respondent. 8. I heard the counsel for the second respondent as well. 9. The second respondent has no case at all that the address shown in Exhibit P3 notice is not his correct and complete address and that a letter addressed to him in that address will not be delivered to him. Issuance of notice by registered post acknowledgment due is evidenced by Exhibits P4 and P5. It is true that there is no signature of the second respondent in Exhibit P5 postal CRA 405/02 6 acknowledgment card. The contention of the counsel for the second respondent is that the appellant should have examined the postal authorities to establish that original of Exhibit P3 notice was actually delivered to the second respondent and that for failure of the appellant in doing so, it has to be held, concurring with the court below, that no cause of action has arisen for reason of absence of notice, as mandated by proviso (b) to Section 138 of the Negotiable Instruments Act, delivered to the second respondent. 10. It is worthy to note in this context as to what proviso (b) to Section 138 of the Negotiable Instruments Act mandates. The proviso reads as follows: “Provided that nothing contained in this section shall apply unless- (a) xxxx xxxxx xxxx (b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of CRA 405/02 7 the said amount of money by giving a notice in writing, to the drawer of the cheque, (within thirty days) of the receipt of information by him from the bank regarding the return of the cheque as unpaid.” In the instant case, the appellant, the payee under Exhibit P1 cheque, has made a demand for payment of the amounts covered by the cheque by giving notice in writing to the drawer of the cheque as evidenced by Exhibits P3 to P5 within the statutory period, on receipt of information by him from the bank regarding return of Exhibit P1 cheque as unpaid, vide Exhibit P2 memo. Apart from advancing a demand for the payment of the amount by giving a notice in writing to the drawer of the cheque in his correct and complete address, there is no statutory duty cast on the appellant, the payee under the cheque, to show further that it is actually delivered to the drawer of the cheque. There is presumption under Section 114 of the Evidence Act and under the Postal Code that the postal article is delivered to CRA 405/02 8 the addressee, when it is shown that it was despatched in his correct and complete address. Hence, if at all, the second respondent wanted to establish that he had not received the original of Exhibit P3 notice, it was up to him to examine the postal authorities and establish that Exhibit P3 notice had not been delivered over to him. 11. Even assuming that notice properly despatched to the second respondent, complying with proviso (b) to Section 138 of the Negotiable Instruments Act, is not delivered over to the second respondent, that is no ground to acquit the second respondent, as has been done by the court below. At best, on entering appearance, had the second respondent submitted that he has not received the notice and that he is ready to pay the amount covered by the cheque within fifteen days from the date on which he entered appearance in court, the case was a fit one for acquittal of the second respondent. He having not done that either, CRA 405/02 9 it does not lie in his mouth to contend that the complaint filed by the appellant, duly satisfying all the statutory requirements, is not maintainable. Consequently, the finding of the court below that the complaint is not maintainable, as there is no cause of action for the complainant to file a complaint under Section 138 of the Negotiable Instruments Act for reason of non compliance of proviso (b) to Section 138 of the Negotiable Instruments Act, deserves to be set aside and I do so. 12. It is contended before me by the counsel for the second respondent that the finding of the court below in favour of the appellant that Exhibit P1 cheque is issued by the second respondent in discharge of a legally existing debt to the appellant as also the finding that Exhibit P1 cheque was dishonoured due to insufficiency of funds in the account of the second respondent are not bind on him and it requires re-consideration by CRA 405/02 10 this Court, as the second respondent was not expected to file any appeal as regards those findings, when he is ultimately acquitted in the case by the learned Magistrate. The argument advanced is sound and tenable. All the same, counsel for the second respondent has no case that Exhibit P1 cheque was being dishonoured not for reason of insufficiency of funds in the account of the second respondent, but for any other reason. His only contention is that the question as to whether Exhibit P1 cheque is one issued in discharge of a legally existing debt due to the appellant or not be considered afresh. He has taken me through the entire evidence in the case. It is seen from the testimony of PW1, the appellant, that he has given evidence consistent with the allegations in the complaint. In cross- examination, it has been brought out that Exhibit P1 cheque was being issued to the appellant on the very date of advancing the loan and that was on CRA 405/02 11 11.3.1999. Though PW1 admitted that the date on which Rs.1,12,000/- was advanced to the second respondent is not mentioned in the complaint, that is a mistake, as there is specific mention in the complaint that the said loan was being advanced on 11.3.1999. Evidence of PW1 is that himself along with the second respondent and two others at Kudaku were jointly having ginger and plantain cultivation in about forty acres of land at Kudaku and that it is from the share of income that he has got that Rs.1,12,000/- was advanced to the second respondent and that they were having mutual confidence among them and that financial transactions were also there between them. He further stated that sale of ginger was being effected by the second respondent and the persons at Kudaku, who were having joint cultivation with him and that the amount due to his share had been paid to him. There is absolutely no challenge as regards the joint cultivation the appellant and the second respondent were having CRA 405/02 12 with two other persons at Kudaku in extensive areas of land. There is also no case for the second respondent that the appellant was not having sufficient funds in his possession to advance such an amount to him. The only question put to PW1 in cross-examination, assailing the authenticity of Exhibit P1 cheque in its present form is as to whether it was not made up on a blank signed cheque leaf entrusted by the second respondent with him, while they were conducting such joint cultivation and that has been emphatically denied also by the appellant. 13. It is worthy to note that the above suggestive question put to PW1 in cross-examination by the Lawyer is not supported by the stand of the second respondent when questioned under Section 313 Cr.P.C. When asked as to whether he has got anything to say in the matter, the second respondent has stated only that he does not owe any amount to the appellant and that he is innocent and CRA 405/02 13 not that Exhibit P1 cheque is made up on a blank signed cheque leaf which he entrusted with the appellant while they were having joint cultivation. In the circumstances, the finding of the court below that Exhibit P1 cheque was issued by the second respondent to the appellant in discharge of a legally enforceable debt does not deserve to be interfered with and has only to be confirmed and I do so. 14. Exhibit P1 cheque issued by the second respondent to the appellant in discharge of a legally enforceable debt, having been dishonoured for reason of insufficiency of funds in the account of the second respondent and as the appellant has satisfied all the statutory pre-requisites for the maintainability of a complaint under Section 138 of the Negotiable Instruments Act, an offence for conviction under Section 138 of the Negotiable Instruments Act stands made out as against the second respondent. CRA 405/02 14 In the result, allowing this appeal, in reversal of the acquittal of the second respondent of offence under Section 138 of the Negotiable Instruments Act by the court below, I convict the second respondent of offence under Section 138 of the negotiable Instruments Act. For questioning the second respondent regarding sentence, posted to 10.4.2008. 2nd April, 2008 (K.P.Balachandran, Judge) tkv CRA 405/02 15 K.P.Balachandran, J. --------------------- Crl.A.No.405 of 2002 --------------------- JUDGMENT 2nd April, 2008