IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE V.GIRI WEDNESDAY, THE 20TH AUGUST 2008 / 29TH SRAVANA 1930 CRL.A.No. 66 of 2001(A) ------------------------------ CC.490/1998 of JUDL. MAGISTRATE OF FIRST CLASS COURT-I, TRIVANDRUM .................... APPELLANT/COMPLAINANT : ---------------------------------- JAMES, VRINDAVAN COMMUNITY HALL, PEYAD, THIRUVANANTHAPURAM BY ADV. SRI.R.S.KALKURA RESPONDENTS/ACCUSED : -------------------------------- 1. RAJA MOHANAN NAIR, S/O KUTTAPPAN NAIR, KARTHIKA BHAVAN, POONJAMOODE, NEDUMANGADU (NOW RESIDING AT ARA 139, KALESH NAGAR, PERUKAVU, MANGATTUKADAVU) 2. THE STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM BY ADV. SRI.RAM MOHAN.G. - R1 SRI.G.P.SHINOD - R1 SRI.MANU V. - R1 PUBLIC PROSECUTOR SRI.C.M.KAMMAPPU THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 20/08/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: V.GIRI, J. ------------------------------ Crl.A. No.66 OF 2001 ------------------------------ Dated this the 20th day of August, 2008 JUDGMENT The complainant in C.C.No.490/98 on the files of the Judicial First Class Magistrate-I, Thiruvananthapuram is the appellant herein. 2. The accused was prosecuted for an offence punishable under section 138 of Negotiable Instruments Act (for short “the Act”). On receiving summons he appeared before the court and pleaded not guilty. Evidence was adduced by both sides. On an appreciation of the evidence, court below came to the conclusion that the cheque in question, Exhibit P1, is issued only as a security and not for discharge of any debt or other liability. It was therefore held that the accused cannot be held liable for the offence under section 138 of Negotiable Instruments Act. It was also held by the court below that in the circumstances it cannot be held that the complainant has succeeded to establish the allegations against the accused absolutely and beyond reasonable doubt. The accused was, therefore, acquitted under section Crl.A.66/2001 2 255(1) Cr.P.C. Hence the complainant has approached this Court with this appeal. 3. The complaint was lodged on the allegation that the accused borrowed an amount of Rs.2Lakhs from the complainant on execution of two promissory notes dated 10.08.1996 and 25.09.1996. Towards the partial discharge of the said liability, the accused issued a cheque dated 08.01.1998 drawn on the Dhanalakshmi Bank Limited in favour of the complainant for an amount of Rs.1Lakh. A promissory note dated 10.08.1996 was also obtained at that time. The cheque, on presentation, was dishonoured for 'insufficient funds'. Exhibit P3 advocate's notice was issued in favour of the accused in three different addresses. One of them was received by him. There was no response for the same and hence the compliant was lodged alleging that the accused has thereby committed an offence punishable under section 138 of the Act. 4. The complainant examined himself as PW1. The accused was examined as DW2 and also examined another person as DW1, who apparently was a witness to the transaction Crl.A.66/2001 3 between the complainant and the accused. The issuance of Exhibit P1 cheque as such was not denied by the accused. But as could be seen from his testimony as DW2 and the suggestion put on his behalf, in the cross examination of PW1 is that an amount of Rs.25,000/- was borrowed by the accused from the complainant and a blank signed cheque was handed over to the complainant at that point of time. The interest accrued was 10% per month, namely Rs.2,500/-, to be paid per month on the principal amount of Rs.25,000/-. The accused had denied the transaction as pleaded by the complainant though the accused had admitted that there was a transaction between the complainant and the accused. According to him, he borrowed only Rs.25,000/-. 5. The court below appreciated the testimony of PW1. It was deposed by PW1, in the chief examination that, he had lent an amount of Rs.1Lakh to the accused and the accused had issued a promissory note at that point of time, that later, for the same amount, Exhibit P1 cheque was issued and it was dishonoured due to insufficiency of funds. In cross examination Crl.A.66/2001 4 he deposed that he has been acquainted with the accused for the past 4-5 years, that he was acquainted with the brother of the accused, who is no more. The account number has not been written on Ext.P1 cheque. He specifically deposed that the cheque was issued and the promissory note, which had originally been executed, was returned at that point of time. The cheque was not issued at the time when the amount was paid by the complainant to the accused, but it was issued when the promissory note was returned. There are certain aspects in the testimony of PW1 which are crucial and which have been appreciated by the court below as well. PW1 has specifically deposed that the money was received by the accused in the year 1997. Apparently, to a specific question as to the amount received by the accused, the answer given is that the accused received an amount of Rs.1 Lakh. It is also stated that another promissory note executed by the accused is in the possession of the complainant and it can be produced before the court. He further states that the promissory note in his possession is also for an amount of Rs.1 Lakh. He also contended that Surendran, examined as DW1, whom the Crl.A.66/2001 5 complainant describes as the clerk of the accused, had actually written the cheque and Surendran had also been a witness to the promissory note. He affirms Exhibit P3 notice. 6. A perusal of Exhibit P3 notice will show that, apart from referring to the dishonour of Exhibit P1 cheque, it also referred to another promissory note and it also contains a demand for an amount of Rs.1,24,000/- on the basis of the said promissory note. 7. The court below found that there is lack of consistency in the version given by the complainant vis-a-vis the statements contained in the complaint read with Exhibit P3 advocate's notice. Particular reference is made to the fact that the complainant had specifically deposed that the amount borrowed by the accused from the complainant was a sum of Rs.1Lakh. This is inconsistent with the version given in the complaint where it is stated that the accused borrowed an amount of Rs.2Lakhs and is further inconsistent with the version given in Exhibit P3. The complainant stated even in his chief examination that he lent a sum of Rs.1Lakh to the accused. He then says that the promissory note Crl.A.66/2001 6 was executed at that point of time and the said promissory note had been returned at the time when Exhibit P1 cheque was issued. At no stage, in his deposition, the complainant made an attempt to make it clear that the amount of Rs.1Lakh which he has referred to is relatable to Exhibit P1 cheque and that the total amount which the accused borrowed from the complainant is an amount of Rs.2Lakhs. This becomes crucial in assessing the credibility of the version given by PW1. Apart from Exhibit P1, there is no other contemporaneous evidence to show that an amount of Rs.1Lakh or 2Lakhs, as the case may be, was advanced by the complainant to accused. Learned counsel for the appellant submits that irrespective of the quantum of the amount borrowed, there is an admission by the accused that there was actually a transaction between the complainant and the accused, though according to the accused, the amount borrowed was only Rs.25,000/-. He contented, therefore, the cheque must be treated as supported by consideration, which is sufficient for the purpose of making out an offence punishable under section 138 of the Act. Crl.A.66/2001 7 8. The proceedings under section 138 of the Act are criminal proceedings. Admission, if any, by the accused can only be for the purpose of ascertaining the veracity of the version given by the complainant. There is no admission as such by the accused in the instant case. He has consistently maintained that Exhibit P1 is not supported by consideration. He submitted that he only issued a blank cheque when he received an amount of Rs.25,000/- from the complainant. At the same time, he had also executed a promissory note, which was never returned. In other words, it cannot be said that the accused had admitted Exhibit P1 cheque as having been issued in discharge of a liability for an amount of Rs.1 Lakh incurred by the accused in favour of the complainant. 9. The inconsistent version in the deposition of PW1 becomes crucial in assessing the credibility of the witness as such, where he has pleaded in the complaint that the accused borrowed an amount of Rs.2 Lakhs on two different dates. The version given by him as PW1, both in the chief examination as also in the cross examination, is that the accused had borrowed Crl.A.66/2001 8 an amount of Rs.1 Lakh whereas he maintains both in the complaint and in Exhibit P3 advocate's notice as also at the time of deposition as PW1 that another promissory note executed by the accused is still in his possession. There is a specific failure on his part in producing the same before the court. Had it been produced, there would have been some evidence to support his case that Exhibit P1 cheque was issued for the purpose of discharging the liability, other than the liability which is covered by the promissory note which the accused had received earlier and which continues to be unreturned even as on the date of the complaint. 10. I am also in agreement with the finding of the court below that the version given by DW1 and DW2 are both probable. His reply in court below was that the writing in Exhibit P1 cheque is not his. The consistent stand taken up by the accused was that the cheque which was handed over to the complainant was a blank one. 11. On an overall appreciation of the evidence, I do not find may way to disagree with the finding of the court below. Crl.A.66/2001 9 There is no acceptable proof to show that Exhibit P1 cheque was issued by the accused in discharge of a liability as it purports to. 12. Learned counsel for the appellant submits that there is sufficient evidence to show that there was insufficiency of funds in the account maintained by the accused, that it has also been admitted by the accused that the signature in Exhibit P1 cheque is his and these two factors are sufficient to prove the ingredients of section 138 of the Act. I am unable to accept this contention. A blank cheque does not itself make it a negotiable instrument. Issuance of blank cheque itself would not be sufficient to establish the execution of instrument of such. In this case, there is no evidence to show that authority had been given by the executor to the payee, who thereafter filled up the details on behalf of the executor or the bearer of the cheque and it would be a negotiable instrument in its complete sense. But that is not the case set up by the complainant. It is not his case that a blank cheque had been issued in discharge of a liability and the accused had expressly authorised him to fill up the cheque to make it complete and then present it for encashment. It is Crl.A.66/2001 10 therefore not a case where the evidence on record would clear y show that Exhibit P1 cheque, as it is presented before court was therefore a cheque validly issued by the accused in disch rge of a liability. I am in agreement with the court below that the evidence on record is not sufficient to come to the conclusion that the ingredients of section 138 of the Act have been proved. It is insufficient to hold that the accused is guilty of the offence under section 138 of the Act. No interference is called for in an appeal against acquittal. An interference is normally possible only if I am able to come to the conclusion that the finding by the court below is clearly unsustainable. For all these reasons the appeal is found to be devoid of merit and it is accordingly dismissed. V.GIRI, JUDGE pac