Partly allowed

Dr Sjidha M v. M/S Maragosoochi Chits Pvt. Ltd.

Karnataka HC6 Aug 2021CRL.RP/241/2019

Case brief

AI extract

What is this about?

In this criminal revision under Section 397/401 CrPC, the High Court of Karnataka upheld the conviction for cheque dishonour but reduced the fine from Rs. 7,00,000 to Rs. 6,50,000, noting that no material evidence supported the claim of third-party misuse of the cheque.

What did the court decide?

Revision petition allowed in part; conviction maintained but fine reduced to Rs. 6,50,000.

Dr Sjidha M Vs M/S Maragosoochi Chits Pvt. Ltd. — Cheque Dishonour | Karnataka HC (2021)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 6^TH DAY OF AUGUST, 2021

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BEFORE

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THE HON’BLE MR. JUSTICE V. SRISHANANDA

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CRIMINAL REVISION PETITION NO.241/2019

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BETWEEN :

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DR. SJIDHA M., D/O SRI. MASTHAN, W/O SRI. RAJA BAKSHI, R/AT NO.16, 22^ND E MAIN ROAD, PIPELINE ROAD, J.C. NAGAR, KURUBARAHALLI, BENGALURU-560 086.

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…PETITIONER

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(BY SRI. AMSHITH HEGDE H.S., ADV., THROUGH VIDEO CONFERENCE)

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AND :

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M/S MARAGOSOOCHI CHITS PVT., LTD., NO.912/2, VASTHUSRI, 18^TH A MAIN, 5^TH BLOCK RAJAJINAGAR, BANGALORE-10, REP.BY ITS FOREMAN THE MANAGING DIRECTOR SRI SUNIL S.PATIL.

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…RESPONDENT

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(BY SRI. CHANDRASHEKAR P.PATIL, ADV., THROUGH PHYSICAL HEARING)

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THIS CRL.RP. IS FILED UNDER SECTION 397 R/W 401 OF CR.P.C., PRAYING TO SET ASIDE THE JUDGMENT AND ORDER OF SENTENCE DATED 07.11.2018 PASSED

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BY THE LXVI ADDL. CITY CIVIL AND SESSIONS JUDGE, BENGALURU, IN CRL.A.NO.1201/2017 CONFIRMED BY THE JUDGMENT DATED 27.07.2017 PASSED BY THE COURT OF THE XXVII ADDL.C.M.M., BENGALURU IN C.C.NO.8380/2016 FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF N.I. ACT AND ACQUIT THE PETITIONER OF THE OFFENCE PUNISHABLE UNDER SECTION 138 OF N.I. ACT IN C.C.NO.8380/2016 ON THE FILE OF XXVII ADDL. C.M.M., BENGALURU AND ETC.,

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THIS CRL.RP. IS COMING ON FOR ADMISSION THIS DAY, THE COURT MADE THE FOLLOWING:-

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ORDER

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Though, this matter is listed for admission, with

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the consent of learned counsel for both the parties, it is taken up for final disposal.

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Heard Sri Amshith Hegde H.S., learned counsel for the accused/revision petitioner and Sri Chandrashekar

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P.Patil, learned counsel for the respondent/complainant.

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The present criminal revision petition is filed challenging the validity of the judgment dated 27.07.2017 passed in C.C.No.8380/2016 on the file of XXVII Addl. Chief Metropolitan Magistrate, Bengaluru,

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whereunder, the accused/revision petitioner has been convicted for an offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the “N.I.Act” for short) and ordered to pay fine of Rs.7,00,000/- with a default sentence of simple imprisonment for a period of four months and a sum of Rs.6,95,000/- was ordered to be paid as compensation to the complainant and balance of Rs.5,000/- for defraying expenses of the State. It was confirmed in Crl.A.No.1201/2017 dated 07.11.2018 on the file of LXVI Addl. City Civil and Sessions Judge, Bengaluru City (CCH-67).

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The brief facts of the case are as under:

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The cheque came to be issued by the accused/ revision petitioner for the purpose of legally recoverable debt, on presentation came to be dishourned and after issuance of notice also, there was no compliance. Ultimately, resulted in filing of complaint before the

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jurisdictional Magistrate. After securing the presence of the accused, plea came to be recorded. Since, the accused pleaded not guilty, the complainant led his evidence by examining himself as P.W.1 and relied on 17 documents, which are exhibited and marked as Exs.P.1 to P.17.

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There was no defence evidence on behalf of

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the accused. In the accused statement recorded under Section 313 of Cr.P.C., the accused has denied all the incriminating circumstances. Based on the oral and documentary evidence on record, the learned Magistrate recorded an order of conviction as referred to supra.

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Being aggrieved by the same, the

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accused/revision petitioner has preferred an appeal before the Sessions Court in Crl.A.No.1201/2017.

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The learned Sessions Judge in the first Appellate Court after securing the trial Court records

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and hearing the parties, has confirmed the judgment passed by the learned Magistrate upholding the order of conviction and sentence. Being aggrieved by the same, the accused/revision petitioner is before this Court.

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Sri Amshith Hegde H.S., learned counsel for the accused/revision petitioner has vehemently contended that both the courts have not properly appreciated the material on record and wrongly recorded an order of conviction and sentence. He further contended that both the courts did not properly appreciate the oral testimony of P.W.1 and did not properly appreciate the probative value of documentary evidence relied on by the complainant. He also contended that the cheque came to be issued by the accused to third person and it has been misused by the complainant and therefore, sought for allowing the revision petition. In the alternative, he also contended

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that awarding of fine amount of Rs.7,00,000/- is

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excessive and sought for reducing the same.

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Per contra, Sri Chandrashekar P.Patil, learned counsel for the respondent/complainant supported the impugned judgment. He pointed out that the cheque came to be issued for the legally recoverable debt and who is the third person who had actually received the same is not examined or not even spelt out in the cross examination of P.W.1. Therefore, the contention that there is no privity between the complainant and accused cannot be countenanced in law. Therefore, in the revisional jurisdiction, this Court cannot re-visit into the facts and findings of both the Courts and prayed for dismissal of the revision petition.

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Insofar as alternative submission is concerned, learned counsel for the respondent submitted that the cheque came to be issued in the year 2016 and already five years have elapsed. Having

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regard to the rate of interest prescribed for a cheque, under Section 80 of the N.I.Act, the complainant is entitled to interest at the rate of 18%. Therefore, having regard to the cheque amount of Rs.5,58,225/-, awarding compensation of Rs.7,00,000/- by the learned Magistrate is just and proper, which has rightly been appreciated by the first Appellate Court and therefore, sought for dismissal of the revision petition.

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In view of the rival contentions, the following

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points arise for my consideration:

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(i) Whether the accused/revision petitioner makes out a case that the finding recorded by the learned Magistrate that the accused has committed an offence punishable under Section 138 of N.I.Act confirmed by the First Appellate Court is suffering from patent defect and error of jurisdiction?

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(ii) Whether the accused/revision petitioner makes out a case that the sentence is excessive?

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In the case on hand, issuance of cheque,

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signature found on the cheque and the cheque being

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dishonoured by the banker of the accused is established by producing the original cheque and the bank endorsement. The legal notice issued is served on the accused and the same is not complied. The material available on record discloses that the complaint came to be filed in time and thereafter, plea was recorded and accused pleaded not guilty. The law in respect of how to prove an offence under Section 138 of N.I.Act is no longer res intergra . The procedure to be adopted in such cases is as per the directions of the Hon’ble Apex Court in the case of Indian Bank Association and Others

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Vs. Union of India and Another reported in 2014 (5) SCC 590 . The directions are as under:

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DIRECTIONS:

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1) Metropolitan Magistrate/Judicial Magistrate (MM/JM), on the day when the complaint under Section 138 of the Act is presented, shall scrutinize the complaint and, if the complaint is accompanied by the affidavit, and the affidavit and the documents, if any, are found to be in order, take cognizance and direct issuance of summons.

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2) MM/JM should adopt a pragmatic and realistic approach while issuing summons. Summons must be properly addressed and sent by post as well as by e-

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mail address got from the complainant. Court, in appropriate cases, may take the assistance of the police or the nearby Court to serve notice to the accused. For notice of appearance, a short date be fixed. If the summons is received back un-served, immediate follow up action be taken.

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3) Court may indicate in the summon that if the accused makes an application for compounding of offences at the first hearing of the case and, if such an application is made, Court may pass appropriate orders at the earliest.

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4) Court should direct the accused, when he appears to furnish a bail bond, to ensure his appearance during trial and ask him to take notice under Section 251Cr.P.C. to enable him to enter his plea of defence and fix the case for defence evidence, unless an application is made by the accused under Section 145(2) for re- calling a witness for cross-examination.

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(5) The Court concerned must ensure that examination-in- chief, cross-examination and re-examination of the complainant must be conducted within three months of assigning the case. The Court has option of accepting affidavits of the witnesses, instead of examining them in Court. Witnesses to the complaint and accused must be available for cross-examination as and when there is direction to this effect by the Court.

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Admittedly, such a procedure is not adopted

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in the case on hand. The accused did not avail the opportunity of leading defence evidence. As such, the learned Magistrate after taking into consideration the law and factual aspects of the matter came to the

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conclusion that the accused has committed an offence punishable under Section 138 of N.I.Act. The said finding is based on the legal evidence placed before the learned Magistrate. Therefore, the finding recorded by the learned Magistrate and confirmed by the first Appellate Court that the accused has committed an offence punishable under Section 138 of N.I.Act stands proved based on the material evidence on record.

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Before this Court, however, a ground is raised by the revision petitioner that the cheque was actually issued to a third person which has been misused by the complainant. No material documents are available on record nor any oral evidence is placed by the complainant to establish the same. Therefore, in the absence of any such material evidence placed before the trial Court and First Appellate Court. Mere taking the contention before this Court that the cheque was actually issued to third party and the same is misused

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by the revision petitioner cannot thus be countenanced. Further, if at all the cheque is misused by the complainant, atleast a legal notice should have been issued by the accused calling upon the complainant to answer for misuse of cheque or proceed against the person who has actually received the cheque from the accused. No such action is taken by accused. Under such circumstances, the said ground also cannot be countenanced in law. Accordingly, point No.1 is answered in negative.

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With regard to point No.2 is concerned, the cheque came to be issued in a sum of Rs.5,58,225/-. The learned Magistrate has awarded a sum of Rs.7,00,000/as fine amount and ordered Rs.6,95,000/- to be paid as compensation to the complainant. In the case on hand, the cheque came to be issued in the year 2016. Therefore, awarding reasonable fine would meet the expenses and interest,

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which is always permissible in the trial, especially when the statute itself provides the learned Magistrate to award double the amount of cheque as fine. In the case on hand, the learned Magistrate has used its discretionary power vested in him and ordered Rs.7,00,000/-. Having regard to the nature of transaction and having regard to the cheque amount, this Court is of the opinion that the accused/revision petitioner has made out a case for reducing a sum of Rs.50,000/- from the fine amount. Accordingly, point No.2 is answered partly in affirmative.

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14. Accordingly, following order is passed:

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ORDER

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(i) Revision petition is allowed in part.

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(ii) While maintaining the conviction order passed by the learned Magistrate and confirmed by the first Appellate Court in

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Crl.A.No.1201/2017, the fine amount of Rs.7,00,000/- is reduced to Rs.6,50,000/-.

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(iii) Out of the fine amount, Rs.6,45,000/- is payable as compensation to the respondent/complainant and balance amount of Rs.5,000/- as defraying expenses for the State.

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Ordered accordingly.

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Office is directed to return the trial court records with a copy of this order forthwith.

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Sd/JUDGE

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Dr Sjidha M v. M/S Maragosoochi Chits Pvt. Ltd.

Case brief

What is this about?

What did the court decide?

Dr Sjidha M v. M/S Maragosoochi Chits Pvt. Ltd.

Case brief

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What did the court decide?

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