Partly allowed

V.Narakathara v. Elsamma Sunny and Another

Kerala HC7 Feb 2020Crl.Rev.Pet/257/2009

Case brief

AI extract

What is this about?

In a criminal revision against a conviction and sentence for cheque dishonour, the High Court held that the revision petition could be allowed in part to alter the sentence. While affirming the conviction based on Section 138 NI Act and precedent, the Court substituted the sentence of imprisonment with a fine of Rs.3 lakh.

What did the court decide?

The criminal revision petition was allowed in part. The sentence of simple imprisonment for three months imposed by the appellate court was altered to a fine of Rs.3 lakh. Default in payment would att

V.Narakathara Vs Elsamma Sunny and Another — Cheque Dishonour | Kerala HC (2020)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR.JUSTICE N.ANIL KUMAR

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FRIDAY, THE 07TH DAY OF FEBRUARY 2020 / 18TH MAGHA, 1941

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Crl.Rev.Pet.No.257 OF 2009

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AGAINST THE JUDGMENT IN CRA 338/2006 DATED 17-12-2008 OF ADDITIONAL SESSN.COURT (ADHOC-II)KASARAGODE

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AGAINST THE JUDGMENT IN CC 98/1998 DATED 05-08-2006 OF JUDICIAL MAGISTRATE OF FIRST CLASS -II,HOSDRUG

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REVISION PETITIONER/APPELLANT/ACCUSED:

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MATHEW V.NARAKATHARA,S/O.VARGHESE AGED 59 YEARS, NARKATHARA HOUSE, MAVULLAL,, P.O. VALLARIKUNDU, PARAPPA VILLAGE,, HOSDURG TALUK, KASARAGOD DISTRICT.

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BY ADVS. SRI.P.G.THAMPI (SR.) SRI.V.GOPIKRISHNA SRI.G.PRIYADARSAN THAMPI RESPONDENTS/RESPONDENTS/COMPLAINANT & STATE:

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1 ELSAMMA SUNNY ,W/O. SUNNY MATHEW, CHENTHADY, P.O.KARINDALAM,, HOSDURG TALUK, KASARAGOD DISTRICT, REPRESENTED BY, HER POWER OF ATTORNEY HOLDER N.M.THOMAS,, S/O.LATE N.M. MANI,AGED 35, NADUVILEKUTTU HOUSE,CHENTHADI,P.O., KARINDALAM,HOSDURG TALUK, KASARGOD DISTRICT

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2 STATE OF KERALA REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA,, ERNAKULAM.

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R1 BY ADV. PUBLIC PROSECUTOR R1 BY ADV. SRI.KODOTH SREEDHARAN

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PUBLIC PROSECUTOR - SMT.M N MAYA

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THIS CRIMINAL REVISION PETITION HAVING BEEN FINALLY HEARD ON 14-01-2020, THE COURT ON 07-02-2020 PASSED THE FOLLOWING:

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Crl.R.P.No.257 of 2009

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Crl.R.P.No.257 of 2009

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ORDER

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This instant revision petition is directed against the judgment of conviction and sentence dated 17.12.2008 in Crl.A.No.338/2006 on the file of the Additional Sessions Judge (Ad hoc)-II, Kasaragod, whereby the appellate court modified the judgment dated 5.8.2006 in C.C.No.98/1998 on the file of the Judicial First Class Magistrate Court-II, Hosdurg.

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The case against the revision

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petitioner/accused arose in pursuance of a private complaint filed by the first respondent before the Judicial First Class Magistrate Court-II, Hosdurg, alleging offences punishable under Section 138 of the Negotiable Instruments Act (hereinafter referred to as 'the N.I.Act).

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After the trial, the learned Magistrate acquitted the revision petitioner/accused. Challenging the

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Crl.R.P.No.257 of 2009

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same, the first respondent approached this Court by filing Crl.A.No.837/2001. This Court remanded the case to the trial court, directing the trial court to dispose of the case afresh, after giving the complainant a further opportunity to adduce all further relevant evidence that she wants to. It was further observed that proceedings shall continue from that stage and all opportunities shall be granted to the respondent also to adduce appropriate evidence.

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In this context, paragraphs 2 and 3 of the

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judgment of Crl.Appeal No.837 of 2001 are relevant, which are as follows:-

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''2. In the nature of the order that I propose to pass, it is not necessary to advert to all the detailed facts. Liability to pay an amount of Rs.3 lakhs under Ext.P1 cheque is not virtually disputed. Ext.P9/D2 is admitted by both sides. A reading of Ext.P9/D2 would indicate that the complainant has a right to present the cheque for encashment only if the pre-condition of measurement of an item of property is complied with. There is a dispute between the parties as to whether such compliance was there or not.

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Crl.R.P.No.257 of 2009

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3. Considering the nature of the dispute between the parties, I am persuaded to agree that the interest of justice will be met ideally by granting the complainant an opportunity to substantiate her contention that her obligation under Ext.D2 has been discharged and that she was entitled to present the cheque on the date of the cheque i.e, 20.11.1997. Though no specific reason is shown as to why the complainant did not adduce better evidence on that aspect, considering the totality of circumstance and the paramount interest of justice, I am satisfied that such opportunity can and ought to be granted, notwithstanding the fact that the dispute in this case had arisen as early as in 1997. I have come to this conclusion after meticulously going through the materials and considering the issue but refrain from adverting to facts in details in this judgment to ensure that the court below shall reconsider the matter with the further evidence that may be made available, without being influenced in any way by such observations.''

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It is the case of the revision

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petitioner(accused) that he borrowed a sum of Rs.3,00,000/- from the complainant and issued a postdated cheque dated 20.11.1997 for Rs.3,00,000/- (Rupees three lakh only) bearing No.181957 o f the North Malabar Gramin

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Crl.R.P.No.257 of 2009

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Bank, Vellarikundu Branch and issued a cheque drawn on Corporation Bank, Kanhangad Branch in the name of the complainant towards repayment of loan. The complainant presented the aforesaid cheque at the Corporation Bank, Kanhangad branch for collection. But, the cheque was returned unpaid by the Corporation Bank as per the memo dated 06.12.1997 with the endorsement 'funds insufficient'. On 12.12.1997, the complainant issued a legal notice to the accused through her Advocate, calling upon the accused to pay the cheque amount within 15 days of the receipt of the said notice. The accused received the notice on 18.12.1997 and sent a reply dated 27.12.1997. The accused, however, did not care to pay the cheque amount to the complainant as requested.

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It is a fact that the complainant presented the cheque before Kanhangad Branch on 6.12.1997. On the very same date, the accused issued Ext.P6 notice to the

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Crl.R.P.No.257 of 2009

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complainant stating that the husband of the complainant sold an extent of 5 acres of land comprised in Sy.No.164/4A5 and 133 of Balal Village and a registered sale deed was executed in the name of Santhosh Sebastian, who is the nominee of the accused. There were some disputes in respect of the said property and consequently, a settlement was arrived at between the parties. As per the settlement, according to the accused, an understanding was arrived at and issued a cheque for Rs.3,00,000/- (Rupees three lakh only) in the name of the complainant. According to the accused, on 19.05.1997, he had issued a postdated cheque dated 20.11.1997 for Rs.3 lakh in favour of the complainant. Evidencing the settlement, an unregistered agreement dated 19.05.1997 was also arrived between the complainant and the accused whereby the complainant had undertaken to get the property measured with the co-operation of the complainant's husband and satisfying the accused regarding

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Crl.R.P.No.257 of 2009

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the extent of the property before 25.05.1997 and in default,

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it was agreed to return the cheque to the accused on 25.05.1997 itself and the complainant further agreed to withdraw OS No.19/1995 of the Sub Court, Kasaragod between the parties. Thus, it was stated that the suit was withdrawn by the complainant, but the property was not so far measured as agreed between the parties. In short, the contention of the accused is that, the complainant was liable to return the cheque as per the agreement. However, she failed to return the same. Therefore, the accused issued Ext.P6, calling upon the complainant to return the cheque within three days from the date of receipt of Ext.P6 notice.

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One of the contentions taken by the complainant is that knowing that Ext.P1 cheque would be presented before the bank for collection, the accused sent Ext.P6 notice to the complainant, in anticipation of creating a probable defence in case the complainant initiates prosecution under Section 138

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Crl.R.P.No.257 of 2009

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of N.I. Act. It is a fact that Ext.P6 notice was issued on the

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date of dishonour of Ext.P1 cheque.

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Ext.P1 cheque was dishonoured on 06.12.1997 for the reason 'insufficient funds'. The complainant issued Ext.P3-statutory notice dated 12.12.1997 to the accused, calling upon him to pay the amount covered under Ext.P1 cheque. The accused received the notice on 18.12.1997.

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The complaint was filed on 31.01.1998.

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On appreciation of evidence, the learned Magistrate

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held that the execution of the cheque was admitted by the accused and it was proved by the complainant that the cheque was dishonoured on account of insufficient funds. The learned Magistrate concluded that the cheque was issued by the accused for a legally enforceable debt. Accordingly, the accused was sentenced to undergo simple imprisonment for 6 months and to pay an amount of Rs.3 lakh to the complainant as compensation, in default of payment of

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Crl.R.P.No.257 of 2009

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compensation, to undergo simple imprisonment for a period of three months more. In appeal, the learned Additional Sessions Judge, Kasaragod confirmed the conviction and modified the sentence to undergo simple imprisonment for three months and to pay a fine of Rs.3 lakh and in default of payment of fine, to undergo simple imprisonment for three months more.

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During the trial, PW1 to PW5 were examined and marked Exts.P1 to P13 on the complainant's side. Exts.D1 to D6 were marked on the side of the accused.

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The object of criminal revision as per the scheme of the Cr.P.C is to set right a patent defect or an error or jurisdiction of law. There has to be well founded error and it may not be appropriate for this Court to scrutinise the impugned judgment, which upon the face of it bears a token of careful consideration and appears to be in accordance with law. By the judgment in Crl.A.837/2001, this Court granted

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the complainant an opportunity to substantiate her contentions that her obligation under Ext.D2 has been discharged and that she was entitled to present the cheque on the date of cheque, ie., on 20.11.1997. As per Ext.D2 agreement, accused issued Ext.P1 cheque for an amount of Rs.3 lakh in favour of the complainant. Ext.D2 inter alia provides that the complainant is obliged to satisfy the accused by measuring the property on or before 25.05.1995, failing which the complainant is bound to return Ext.P1 cheque to the accused. Ext.P1 is dated 20.11.1997. PW3, the complainant, PW4-the village officer , PW5-one of the neighbours of the property under dispute stated that the property was measured in the month of May 1997. PW4 and PW5 testified before court that the accused was present at the time of measurement. However, the accused contended that the property was not measured as contended in Ext.D2 agreement.

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Crl.R.P.No.257 of 2009

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On 06.12.1997, Ext.P6 notice was issued by the

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accused to the complainant and her husband, demanding return of the cheque issued as per Ext.D2. Admittedly, this was done long after the expiry of the term provided under Ext.D2. Ext.P1 cheque was dishourned for want of funds on 06.12.1997. Last day fixed for measurement of the property was on 25.05.1995. Strange as it may sound, only in the month of December, 1997 the accused had taken steps to return the cheque issued as per the Ext.D2-agreement. On a careful consideration of the entire evidence, the trial court as well as the appellate court entered a finding that the property was measured in accordance with Ext.D2 agreement.

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Going by Section 139 of the N.I Act, unless the contrary is proved, it is presumed that the owner of a cheque received the cheque of the nature referred to in Sec.138 of the N.I.Act for the discharge in whole or in part, of any debt

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Crl.R.P.No.257 of 2009

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or other liability. The accused failed to prove in the trial by adducing cogent evidence that there was no debt or liability. In Bir Singh V. Mukesh Kumar [(2019) 4 SCC 197], the Apex court held that, in view of Section139 of the N.I.Act r/w.Sec.118 of the N.I Act thereof, the court has to presume that the cheque has been issued for discharging a debt or liability. Paragraph Nos.39 and 40 of the above case are relevant in this context and the same has been extracted herein for convenience of reference:-

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''39. It is not the case of the respondent-accused that he either signed the cheque or parted with it under any threat or coercion. Nor is it the case of the respondent-accused that the unfilled signed cheque had been stolen. The existence of a fiduciary relationship between the payee of a cheque and its drawer, would not disentitle the payee to the benefit of the presumption under Section 139 of the Negotiable Instruments Act, in the absence of evidence of exercise of undue influence or coercion. The second question is also answered in the negative.

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40. Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would

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Crl.R.P.No.257 of 2009

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attract presumption under Section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt.''

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The learned counsel for the accused contended that drawal of the cheque in discharge of existing or past adjudicated liability is sine qua non for bringing an offence under Section 138 of the N.I.Act. Thus, it is argued that, if the cheque issued as an advance payment, the cheque cannot be held to have been drawn for an existing debt or liability. Relying on the judgment of the Apex Court in Indus Airways Pvt. Ltd. (M/s.) and Others V. M/s.Magnum Aviation Pvt.Ltd. and Another [2014 (2) KHC 320], the learned counsel for the accused contended that payment by nature of cheque in advance payment indicates that at the time of drawal of cheque, there was no existing liability.

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On going through the judgment of this Court in Crl.Appeal No.837/2001, it is not necessary to discuss and

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Crl.R.P.No.257 of 2009

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decide all the detailed facts. Liability to pay an amount of Rs.3 lakh under Ext.P1 cheque is not disputed. Ext.D2 is admitted by both sides. Ext.D2 would indicate that the complainant has a right to present the cheque for encashment, only on the precondition of measurement of an item of property. Hence, the dispute between the parties is as to whether such compliance was there or not. Under the circumstances, this Court granted an opportunity to substantiate the contention of the complainant that her obligation under Ext.D2 has been discharged. The complainant adduced evidence to prove that her obligation under Ext.D2 had been discharged and she was entitled to present the cheque. The trial court as well as the appellate court confirmed the finding of fact concurrently. Revisional jurisdiction can be invoked where the decision under challenge is grossly erroneous, there is no compliance with the provision of law and finding recorded is based on no

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evidence, material evidence is ignored or judicial decision is exercised arbitrarily or perversely. The facts and circumstances decided in Indus Airways's Case (supra) has no connection with the facts in this case, in view of the finding in Crl.A.837/2001. On a consideration of the entire facts and circumstances of the case, this Court is of the view that no convincing and cogent reasons are pointed out to interfere with the concurrent finding of fact entered by the trial court and the appellate court. Revisional jurisdiction is very limited one and cannot be exercised in a routine manner.

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Having considered the facts and circumstances of the case, this Court is of the view that the sentence imposed by the appellate court can be altered. Accordingly, the sentence of simple imprisonment for three months imposed by the appellate court is altered. The accused is sentenced to pay a fine of Rs.3,00,000/- (Rupees three lakh only), taking

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Crl.R.P.No.257 of 2009

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into consideration of the entire facts and circumstances in this case as well. The fine amount shall be deposited in the trial court, within eight weeks from this date, failing which the accused shall undergo simple imprisonment for a period of three months. The fine amount, if deposited, shall be given to the complainant as compensation in accordance with rules.

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The Criminal Revision Petition is allowed in part,

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accordingly.

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sd/-

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N.ANIL KUMAR, JUDGE

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ajt

V.Narakathara v. Elsamma Sunny and Another

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V.Narakathara v. Elsamma Sunny and Another

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