Dismissed

P.K.Ahammed v. State of Kerala

Kerala HC11 Apr 2024CRL.A/365/2007

Case brief

AI extract

What is this about?

Criminal Appeal filed by a cheque issuer against acquittal in a cheque bounce case. The court upheld the trial court and first appellate acquittal, ruling that proven partial payment before presentation rendered the cheque unenforceable, thereby rebutting statutory presumptions.

What did the court decide?

Criminal Appeal dismissed; interlocutory applications, if any pending, shall stand closed.

P.K.Ahammed Vs State of Kerala — Cheque Dishonour | Kerala HC (2024)

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Crl. Appeal No. 365/2007 : 1 :

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IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT

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THE HONOURABLE MR. JUSTICE JOHNSON JOHN

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THURSDAY, THE 11^TH DAY OF APRIL 2024 / 22ND CHAITHRA, 1946 CRL.A NO. 365 OF 2007

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AGAINST THE JUDGMENT DATED 22.12.2005 IN CRA NO.161 OF 2005 OF ADDITIONAL DISTRICT & SESSIONS COURT, VADAKARA

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APPELLANT/RESPONDENT/COMPLAINANT:

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P.K.AHAMMED, S/O. KUNHABDULLA, PADINHARAKOILOTH HOUSE, PUDUPPANAM AMSOM DESOM,, VADAKARA, REPRESENTED BY HIS POWER OF ATTORNEY, HOLDER UMMERKUTTY, SON OF ABOOBACKER,, "RAHMANIYA", PO PUTHUPPANAMA, VADAKARA,, KOZHIKODE. BY ADV SRI.K.RAMAKUMAR (SR.)

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RESPONDENTS/STATE & ACCUSED:

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

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2 P.P.SADIQUE SO KUNHABDULLA PUTHENPEEDIYIL HOUSE, CHERUMOTH P.O.,, VALAYAM.

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BY ADVS. SRI.AYPE JOSEPH SRI.P.M.MOHAMED ALI R2 BY SRI.T.G.RAJENDRAN R1 BY SRI. VIPIN NARAYAN

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THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 08.04.2024, THE COURT ON 11.04.2024 DELIVERED THE FOLLOWING:

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‘C.R’

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Crl. Appeal No. 365/2007

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: 2 :

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JOHNSON JOHN, J.

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--------------------------------------------------------Crl. Appeal No. 365 of 2007

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-------------------------------------------------------Dated this the 11^th day of April, 2024.

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JUDGMENT

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This appeal is filed against the judgment dated 22.12.2005 in Crl. Appeal No. 161 of 2005 of the Additional District and Sessions Judge, Vadakara, whereby the judgment dated 14.02.2005 of the Judicial First Class Magistrate, Vadakara in C.C. No. 176 of 2002 is set aside and the accused/second respondent was found not guilty of the offence under Section 138 of the Negotiable Instruments Act, 1881 (for short ‘NI Act’) and acquitted.

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The appellant is the complainant. The case of the complainant is that while the complainant and the accused were working in Qatar, the accused borrowed an amount equivalent to Indian Rs.11,50,000/- from the complainant on 07.12.1999 and subsequently issued two cheques, one for Rs.4,00,000/- and other for Rs. 7,50,000/- and when the complainant presented the cheque for collection, the same was dishonoured due to insufficiency of funds and in spite of issuance of statutory notice, the accused failed to pay the cheque amount.

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Crl. Appeal No. 365/2007

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: 3 :

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The complainant filed C.C. No. 176 of 2002 with respect to Exhibit P1 cheque for Rs.4,00,000/- and C.C. No. 240 of 2002 with respect to Exhibit P2 cheque for Rs.7,50,000/-.

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As per the order in Crl. M.P. No. 964 of 2003, joint trial was conducted and from the side of the complainant, PW1 was examined and Exhibits P1 to P10 were marked. From the side of the accused, DW1 was examined and Exhibits D1 and D2 were marked. Assistant Director of Documents, Forensic Science Laboratory, Thiruvananthapuram was examined as CW1 and the report was marked as Exhibit C1.

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After considering the oral and documentary evidence on record and hearing both sides, the trial court acquitted the accused with respect to Exhibit P2 cheque in C.C. No. 240 of 2002 and the accused was found guilty of the offence under Section 138 of the NI Act in C.C. No. 176 of 2002 with respect to Exhibit P1 cheque and he is sentenced to undergo simple imprisonment for a period of two months and also to pay a fine of Rs.50,000/- to the complainant under Section 357(3) Cr.P.C.

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Against the trial court judgment, the accused filed Crl. Appeal No. 161 of 2005 and the complainant filed Crl. R.P. No. 27 of 2005 seeking enhancement of sentence before the District and Sessions Judge, Vadakara and as per the impugned common judgment dated 22.12.2005 in Crl. Appeal No. 161 of 2005 and Crl. R.P. No. 27 of 2005,

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Crl. Appeal No. 365/2007 : 4 :

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the Crl. Revision Petition was dismissed and the Crl. Appeal was allowed and the accused was acquitted of the offence under Section 138 of the NI Act in C.C. No. 176 of 2002.

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7.Heard Sri. K. Ramkumar, the learned Senior counsel for the appellant, Sri. T.G. Rajendran, the learned counsel for the second respondent and Sri. Vipin Narayan, the learned Public Prosecutor and perused the records.

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The learned counsel for the appellant argued that the issuance of the cheque and the signature are not disputed and the learned Sessions Judge wrongly considered the evidence relating to Exhibit P2 cheque in C.C No. 240 of 2002 to arrive at a finding that the accused has succeeded in rebutting the statutory presumptions in favour of the complainant.

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But, the learned counsel for the accused/second respondent pointed out that the trial court conducted joint trial of both the cases as per the order in Crl. M. P. No. 964 of 2003 and since the evidence in C.C. Nos. 176 and 240 of 2002 are the same, there is no illegality in reappreciating the entire evidence by the District Court in appeal and there is no valid ground to interfere with the impugned judgment.

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Crl. Appeal No. 365/2007

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: 5 :

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The specific case of the defence is that the accused had borrowed only Rs.4,00,000/- from the complainant after entrusting Exhibit P1 cheque and thereafter, he made a payment of Rs.3,50,000/and he also issued another cheque for the balance amount of Rs.50,000/- to the complainant. The case put forward by the defence is that the complainant altered the cheque for Rs.50,000/- by inserting the digit ‘7’ before the digit ‘5’ in the figure ‘50,000/-’ so as to make it appear that the cheque is one for Rs.7,50,000/- and on the basis of the said materially altered cheque, he filed C.C. No. 240 of 2002.

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It is the specific case of the accused that after the issuance of Exhibit P1 cheque for Rs.4,00,000/-, he paid Rs.3,50,000/- to the complainant and therefore, the balance amount is only 50,000/- and in that circumstance, the earlier cheque for Rs.4,00,000/- had become unenforceable for want of consideration. It is also the specific case of the accused that since the complainant has materially altered Exhibit P2 cheque, the same is also unenforceable under the law.

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It is pertinent to note that the trial court, after appreciating the evidence, found that the cheque marked as Exhibit P2 is the cheque originally issued by the accused for Rs.50,000/- and that the same was subsequently altered materially by the complainant to make it for Rs.7,50,000/- and it was on the basis of the said finding that the trial

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Crl. Appeal No. 365/2007 : 6 :

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court found the accused not guilty of the offence under Section 138 of the NI Act in C.C. No. 240 of 2002 and acquitted him.

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It is worthwhile to note that the complainant has not filed any appeal against the acquittal of the accused in C.C. No. 240 of 2002 and therefore, the said finding has become final. It is the specific case of the accused that after the issuance of Exhibit P1 cheque, he paid Rs.3,50,000/- to the complainant and Exhibit D1 is the receipt issued by the complainant in this regard. Even though the trial court found that the amount due from the accused as per Exhibit P1 cheque is only Rs.50,000/- in view of Exhibit D1 receipt proving payment of Rs.3.50000/- by the accused to the complainant after the issuance of Exhibit P1 cheque, the learned Magistrate found the accused guilty in respect of Exhibit P1 cheque and sentenced to undergo simple imprisonment for a period of two months and to pay a compensation of Rs.50,000/- to the complainant under Section 357(3) Cr.P.C.

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There is concurrent finding in the judgment of the trial court and that of the first appellate court that there is no reason to disbelieve the evidence of DW1 that Exhibit D1 receipt is issued by the complainant when the accused made payment of Rs.3,50,000/- and that Exhibit P2 cheque was the cheque originally issued for Rs.50,000/- and subsequently altered by the complainant to make it one for

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Rs.7,50,000/- and in that circumstance, I find no reason to interfere with the finding in the impugned judgment that once payment of Rs.3,50,000/- is proved and the issuance of Exhibit P2 cheque for the balance amount is also well probabilized, the only finding possible is that Exhibit P1 cheque originally issued for Rs.4,00,000/- by the accused had become unenforceable.

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In Dashrathbhai Trikambhai Patel v. Hitesh

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Mahendrabhai Patel [(2023) 1 SCC 578], it was held by the Honourable Supreme Court that when a part payment of the debt is made after the cheque was drawn but before the cheque is encashed, such payment must be endorsed on the cheque under Section 56 of the NI Act and the cheque cannot be presented for encashment without recording the part payment. It was further held that if such a cheque was presented for encashment without recording the part payment and if the same is dishonoured on presentation, the offence under Section 138 of the NI Act would not be attracted, since the cheque does not represent a legally enforceable debt at the time of encashment.

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In Bharat Barrel & Drum Mfg. Co. v. Amin Chand Payrelal

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[(1999) 3 SCC 35], the Honourable Supreme Court held that the non existence of consideration for the cheque can be proved by raising a probable defence and if it is shown that the existence of consideration

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Crl. Appeal No. 365/2007

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: 8 :

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was improbable or doubtful or the same was illegal, the onus would shift to the complainant. In Harbhajan Singh v. State of Punjab (AIR 1966 SC 97), the Honourable Supreme Court held that the onus on an accused person might well be compared to the onus on a party in civil proceedings, and just as in civil proceedings the court trying an issue makes its decision by adopting the test of probabilities

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The Honourable Supreme Court considered the nature of the standard of proof required for rebutting the presumption under Section 139 of the Negotiable Instruments Act in M.S.Narayana Menon v. State of Kerala (2006 (6) SCC 39), and it was held that if some material is brought on record consistent with the innocence of the accused, which may reasonably be true, even though it is not positively proved to be true, the accused would be entitled to acquittal.

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The Honourable Supreme Court in Basalingappa v. Mudibasappa [(2019) 5 SCC 418] summarised the principles of law governing presumptions under Sections 118(a) and 139 of the NI Act in the following manner:

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(i) Once the execution of cheque is admitted S.139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.

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Crl. Appeal No. 365/2007

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(ii) The presumption under S.139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities.

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(iii) To rebut the presumption, it is open for the accused to rely on evidence led by him or accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely.

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(iv) That it is not necessary for the accused to come in the witness box in support of his defence, S.139 imposed an evidentiary burden and not a persuasive burden.

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(v) It is not necessary for the accused to come in the witness box to support his defence.

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It is well settled that the standard of proof which is required from the accused to rebut the statutory presumption under Sections 118 and 139 of NI Act is preponderance of probabilities and that the accused is not required to prove his case beyond reasonable doubt. The standard of proof, in order to rebut the statutory presumption, can be inferred from the materials on record and circumstantial evidence.

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Crl. Appeal No. 365/2007

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There is a specific finding in the trial court judgment that Exhibit P2 cheque is materially altered by the complainant and that the same was originally issued for Rs.50,000/- and later altered and fabricated to one for Rs.7,50,000/- by the complainant and on that ground, the accused was acquitted in C.C.No. 240 of 2002 and the said judgment has already become final. It is also pertinent to note that the trial court has also recorded a finding that the evidence of DW1 that Exhibit D1 is the receipt issued by the complainant to the accused for payment of Rs.3,50,000/- after the issuance of Exhibit P1 cheque and the said finding is also approved in the impugned judgment and considering the facts and circumstances, I find no reason to interfere with the said concurrent findings. When the evidence of DW1 and Exhibit D1 receipt proves payment of Rs.3,50,000/- by the accused to the complainant in partial discharge of the earlier liability of Rs.4,00,000/as per Exhibit P1 cheque and when it is in evidence that the accused has subsequently issued Exhibit P2 cheque for Rs.50,000/- for the balance amount, it cannot be held that Exhibit P1 cheque represent a legally enforceable debt at the time of encashment.

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Therefore, in the absence of any satisfactory evidence to show that Exhibit P1 cheque is supported by a legally enforceable debt at the time when the same was presented for collection, I find no reason to

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interfere with the finding in the impugned judgment that the accused has succeeded in rebutting the statutory presumptions in favour of the complainant and in that circumstance, I find that this appeal is liable to be dismissed.

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In the result, this appeal is dismissed. Interlocutory applications, if any pending, shall stand closed.

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sd/- JOHNSON JOHN, JUDGE.

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P.K.Ahammed v. State of Kerala

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P.K.Ahammed v. State of Kerala

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