Allowed

D.Karthikeyan v. M.Selvaraj

Madras HC11 Mar 2011CRL RC/972/2010

Case brief

AI extract

What is this about?

High Court in revision set aside conviction under Section 138 NI Act, holding accused successfully rebutted statutory presumption by proving cheque was extracted by duress via police, as prosecution failed to prove legal liability beyond reasonable doubt.

What did the court decide?

Conviction and sentence under Section 138 NI Act set aside; petitioner/accused acquitted; fine refunded.

D.Karthikeyan Vs M.Selvaraj — Cheque Dishonour | Madras HC (2011)

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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DATED : 11.03.2011

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CORAM

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THE HONOURABLE MR.JUSTICE P.R.SHIVAKUMAR

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D.Karthikeyan .. Petitioner / Accused

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Vs M.Selvaraj .. Respondent/ Complainant

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PRAYER: Criminal Revision Case filed under Sections 397 r/w 401 of Cr.P.C. to set aside the judgment dated 16.08.2010 made in C.A.No.46 of 2008 on the file of the Additional District Sessions Judge (Fast Track Court No.2), Poonamallee confirming the order of conviction dated 29.10.2008 made in C.C.No.693/2006 on the file of the Judicial Magistrate No.II, Poonamallee and acquit the petitioner/accused herein.

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For Petitioner : Mr.A.Laxmi Raj Rathnam For Respondent : Mr.C.N.Raman O R D E R

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The accused in C.C.No.693/2006 on the file of the learned Judicial Magistrate No.II, Poonamallee, a case instituted on a private complaint for an offence punishable under Section 138 of the Negotiable Instruments Act, 1881, which ended in conviction resulting in the imposition of a sentence of six months simple imprisonment and a fine of Rs.5,000/- and a simple imprisonment for two months in case of default in payment of fine, which also came to be confirmed by the appellate court, namely the Additional District and Sessions Judge (Fast Track Court No.2), Poonamallee in C.A.No.46/2008, has come forward with the present Criminal Revision Case questioning the correctness and legality of the said judgment of the appellate court confirming the conviction recorded and sentence awarded by the trial court.

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The respondent herein preferred a complaint on the file of the learned Judicial Magistrate No.II, Poonamallee, making the following allegations:

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https://hcservices.ecourts.gov.in/hcservices/

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The respondent herein/complainant lent a sum of Rs.4,30,000/to the petitioner herein/accused on 18.12.2004 on behalf of the son of the respondent herein for the supply of kunnam granite stones for which the petitioner herein/accused issued a valid receipt on the said date itself in favour of M/s.Andavar Granites, run by the son of the respondent herein/complainant. After receiving the said amount, the petitioner herein/accused supplied granite stones to the tune of Rs.2,10,860/- alone. For the balance amount, namely Rs.2,19,140/-, the petitioner herein/accused did not supply granite stones as agreed to. When repeated demands were made, the petitioner herein/accused issued a cheque bearing cheque No.717982 dated 27.03.2006 in favour of the respondent herein/complainant drawn on Corporation Bank, Indira Nagar branch, Chennai-20. As requested by the petitioner herein/accused, the same was not presented till 20^th of August 2006 and only thereafter the cheque was presented for collection through Canara Bank, Poonamallee branch, Chennai – 56 on 22.08.2006, but the same was returned dishonoured on 23.08.2006 with an endorsement "insufficient funds". After receiving the intimation from the banker on 24.08.2006, within a period of one week i.e. on 01.09.2006 itself, the respondent/complainant caused the issuance of a statutory notice calling upon the petitioner herein/accused to pay the cheque amount within 15 days of the receipt of the said notice. Though the petitioner herein/accused received the said notice on 04.09.2006, the demand made in the said notice was not complied with. Therefore, the petitioner herein/accused was liable to be punished for committing an offence punishable under Section 138 of the Negotiable Instruments Act, 1881.

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The said private complaint was taken on file as C.C.No.693 of 2006 on the file of the learned Judicial Magistrate No.II, Poonamallee, after following the procedure for taking cognizance of the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 and process came to be issued to the petitioner herein/accused. On appearance, the petitioner herein/accused denied having committed any such offence as alleged in the complaint and hence a trial was conducted, in which the respondent herein/complainant figured as the sole witness (P.W.1) and produced eight documents as Exs.P1 to P8 on his side. After the completion of recording of the evidence on the side of the respondent herein/complainant, the attention of the petitioner herein/accused was drawn to the incriminating materials found in the evidence adduced on the side of the complainant and he was examined under Section 313(1)(b) of Cr.P.C. The petitioner herein/accused denied the evidence to be false and once again reiterated his stand that he was not guilty of the offence alleged. The petitioner herein/accused figured as the sole witness (D.W.1) and two documents were marked as Exs.D1 and D2 on his side.

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After the evidence on the side of the accused was over, the https://hcservices.ecourts.gov.in/hcservices/ learned Judicial Magistrate No.II, Poonamallee heard the arguments

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and considered the evidence and upon such consideration, came to the conclusion that the respondent herein/complainant had proved the charge, against the petitioner herein/accused, of having committed the offence punishable under Section 138 of the Negotiable Instruments Act, 1881. Accordingly, the learned Judiial Magistrate No.II, Poonamallee, convicted the petitioner herein/accused for the said offence and imposed a sentence of simple imprisonment for six months and a fine of Rs.5,000/-. A default sentence of two months simple imprisonment has also been imposed in case of default in payment of fine.

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The said judgment of the trial court was challenged before the Additional District and Sessions Judge (Fast Track Court No.2), Poonamallee in C.A.No.46/2008, both in respect of conviction and sentence. The learned Additional District and Sessions Judge (Fast Track Court No.2), Poonamallee, concurred with the view taken by the trial court, confirmed the judgment of the trial court regarding conviction as well as the sentence and ultimately dismissed the appeal. Therefore, the petitioner has approached this court by filing the present Criminal Revision Case under Section 397 Cr.P.C questioning the correctness and legality of the judgment of the appellate court confirming the conviction recorded and sentence awarded by the trial court.

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This court heard the arguments advanced by Mr.A.Laxmi Raj Rathnam,learned counsel for the petitioner and by Mr.C.N.Raman, learned counsel for the respondent/complainant. The copy of the judgments of the trial court as well as the lower appellate court and the other materials available on record were also perused by this court.

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After suffering a conviction for an offence under Section 138 of the Negotiable Instruments Act,1881 in the hands of the trial court, which came to be confirmed by the appellate court, the petitioner herein/accused has filed the present Criminal Revision Case. Of course the present Criminal Revision Case has been filed against the concurrent findings of the courts below. Though the power of revision is conferred on the High Court and the Sessions Judge under Section 397 Cr.P.C, Section 401 of Cr.P.C makes it abundantly clear that the High Court, while exercising the revisional power, can exercise any of the powers conferred on a court of appeal, with only one restriction that by the exercise of the revisional power, it cannot convert a finding of acquittal into one of conviction. But the converse is permissible. As the High Court in exercise of its power of revision is conferred with all the powers conferred on a court of appeal, it has to re-appraise the evidence and arrive at a decision as to whether the judgment of the courts below, against which the revision has been filed can legally be sustained. Only in case of an appeal against acquittal or a revision against acquittal, the presumption of innocence shall https://hcservices.ecourts.gov.in/hcservices/ stand doubly strengthened. But, no such presumption in favour of

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the prosecution or complainant shall be available in case of an appeal or revision against conviction. Keeping the above said legal proposition in mind, the sustainability of the conviction recorded by the trial court and confirmed by the appellate court has to be considered.

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The learned counsel for the petitioner submitted that the judgment of the lower appellate court confirming the conviction recorded and the sentence awarded by the trial court could not be sustained in law; that the trial court and the appellate court had not properly appreciated the evidence adduced on both sides; that the courts below failed to consider the fact that the petitioner herein/accused was able to rebut the presumption contemplated in Section 139 of the Negotiable Instruments Act, 1881 and thereby the burden of proving the case of the complainant beyond reasonable doubt, stood recast on the complainant; that the courts below failed to note that the proof required to be made by the accused to rebut the presumption is not a proof beyond reasonable doubt and that if the accused is able to prove his defence theory by preponderance of probabilities, the same would be enough to shift the burden and cast the burden of proof of the complaint allegations beyond reasonable doubt on the complainant and that the courts below, without properly appreciating material evidence, had chosen to arrive at a mechanical conclusion that the petitioner herein/accused had committed the offence under Section 138 of the Negotiable Instruments Act, 1881.

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Per contra, the learned counsel for the respondent would contend that both the courts below meticulously analysed the evidence and arrived at a concurrent finding holding the petitioner herein/accused guilt of the offence under Section 138 of the Negotiable Instruments Act, 1881; that no defect or infirmity could be found in them and that therefore the Revision should be dismissed holding that the same does not have any merit in it.

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This court paid its anxious considerations to the above said submissions made on either side.

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It is not in dispute that the cheque produced in this case as Ex.P1 before the trial court is one pertaining to the account maintained by the petitioner herein/accused in Corporation Bank, Indira Nagar branch, Chennai-20. It is also not in dispute that the signature found therein is that of the petitioner herein/accused. It is also not in dispute that the cheque in question was issued in the name of the respondent herein/complainant. The respondent herein/ complainant has also proved by adducing oral and documentary evidence that, the cheque when presented for collection, was returned unpaid with an endorsement "funds insufficient". The memo issued by the bank returning the cheque unpaid, citing insufficient funds as the https://hcservices.ecourts.gov.in/hcservices/ reason for such dishonour has been marked as Ex.P2. Debit Advice

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issued by the banker of the respondent herein/complainant pursuant to the dishonour of the said cheque has been marked as Ex.P3. The Return Memo is dated 23.08.2006. The Debit Advice is dated 24.08.2006. Within a period of one month from the date of receipt of the intimation regarding the dishonour of the cheque, the respondent herein/complainant seems to have issued statutory notice contemplated under Section 138 of the Negotiable Instruments Act, 1881 and a copy of the same has been marked as Ex.P4. Since the acknowledgment for the said notice sent on Registered Post was not received, the petitioner herein/complainant seems to have issued a letter to the Postmaster, Poonamallee Post Office on 18.09.2006, a copy of which has been marked as Ex.P5. Thereafter, Ex.P6 - letter dated 16.10.2006 came to be received by the counsel for the respondent herein/complainant informing that the notice was served on the petitioner herein/accused on 04.09.2006 by Adyar Post Office. After receipt of the said letter, the private complaint came to be filed on 18^th October 2006. As per Ex.P6, the statutory notice was served on the petitioner herein/accused on 04.09.2006. 15 days time expired on 19.09.2006. Within a month therefrom the complaint happened to be filed. Therefore, there cannot be any dispute that the complaint was filed within time stipulated in Section 138 of the Negotiable Instruments Act, 1881. Since the cheque in question is admitted to be one issued by the petitioner herein/accused and the same was drawn on Corporation Bank, Indira Nagar branch, Chennai-20 in respect of an account maintained by the petitioner herein/accused, the presumption contemplated under Section 138 of the Negotiable Instruments Act, 1881 that the cheque was received by the respondent herein/complainant in discharge of a debt or other liability in part or whole stands attracted. When the presumption under Section 139 of the Negotiable Instruments Act, 1881 is attracted, then the burden shall be shifted on the accused to prove the contrary, namely that the cheque was not issued for the discharge of a debt or other liability.

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In this case, the petitioner herein/accused has taken a categorical plea that there was no transaction between the petitioner herein/accused and the respondent herein/complainant; that for a sum of Rs.4,30,000/- received by the petitioner herein/accused from Andavar Granites, he had issued a receipt; that subsequently on completion of supply of granite stones to the above said amount, the said receipt was returned by Andavar Granites to the petitioner herein/accused; that thereafter the respondent herein/complainant, taking advantage of his acquaintance with the police officials as he himself was a retired police personnel, gave a complaint to the police on 29.03.2006 and an ante-dated cheque was obtained by duress as if the same was issued on 27.03.2006; that thereafter the petitioner herein/accused approached this court for the relief of anticipatory bail and all the above said facts had been set out in the petition seeking anticipatory bail; that before the High Court, in the anticipatory bail petition, it was https://hcservices.ecourts.gov.in/hcservices/ informed by the police that the case was closed and hence the

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anticipatory bail petition was dismissed as unnecessary and that only thereafter using the above said cheque extracted with the help of the police, the present complaint has been preferred by the respondent herein/complainant.

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In this regard, certain important aspects have been pointed out by the learned counsel for the petitioner herein/accused, which could be seen in the following discussions. The respondent herein/complainant himself, in his complaint, has not stated that he lent any amount to the petitioner herein/accused and in repayment of the said loan the said cheque in question was issued. On the other hand, the case of the respondent herein/complainant himself is that a sum of Rs.4,30,000/- was paid to the petitioner herein/accused for supplying granite stones to Andavar Granites, which was run by the son of the respondent herein/complainant. It is the further averment made in the complaint that, out of the above said sum of Rs.4,30,000/-, granite stones worth Rs.2,10,000/- had been supplied and since granite stones for the balance amount could not be supplied, the petitioner herein/accused issued Ex.P1 - in favour of the respondent herein/complainant. When it is the case of the complainant that a receipt was issued for the entire amount paid on behalf of Andavar Granites, it is quite improbable that a cheque would have been issued in favour of the respondent herein/complainant rather than Andavar Granites for the balance amount after deducting the value of granites supplied to it. It is also pertinent to note that, though the respondent herein/complainant might have stated that the receipt for a sum of Rs.4,30,000/- issued by the petitioner herein/accused in favour of Andavar Granites was available with the complainant and the same was being produced, in fact the receipt in original has not been produced and only a xerox copy of the same has been produced. On the other hand, it is obvious from the fact that the said original was produced as Ex.D2 by the petitioner herein/accused and that the said receipt was not available either with Andavar Granites or with the respondent herein/complainant on the date of filing of the complaint. The said receipt dated 18.12.2004 issued by the petitioner herein/accused in favour of M/s.Andavar Granites, admitting the receipt of Rs.4,30,000/- as advance for the supply of granites on behalf of M/s.Sokar Product (Pvt.) Ltd. signed by the petitioner herein as Managing Director, has been produced by the petitioner herein/accused and marked as Ex.D2. Of course, it is true that there is nothing in Ex.D2 to show that the receipt was cancelled and handed over to the petitioner herein/accused. On the other hand, it shall be quite obvious to note that the respondent herein/complainant himself has produced Ex.P7 as the receipt issued by the petitioner herein/accused for the receipt of the above said amount (Rs.4,30,000/-) towards advance for the supply of granites to M/s.Andavar Granites. A comparison of Ex.P7 with Ex.D2 will show that Ex.P7 is nothing but the xerox copy of Ex.D2, which is the https://hcservices.ecourts.gov.in/hcservices/ original. No explanation has been given in the complaint as to how

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the original receipt came to be in the hands of the petitioner herein/accused. Even in the chief examination evidence of P.W.1, in the form of proof affidavit, nothing has been mentioned about the circumstances under which the original receipt came to be handed over to the petitioner herein/accused.

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On the other hand, during cross-examination, P.W.1 made an attempt to show that the receipt was handed over to the petitioner herein/accused when he issued Ex.P1 - cheque. The same is a new case sought to be put forward as an afterthought. Ex.P7 was introduced only during the cross-examination of D.W.1. On his admission only Ex.P7 was marked. As pointed out supra, Ex.P7 is not the original and it is only a xerox copy. On the other hand, the original of Ex.P7 was available with the petitioner herein/accused and the same was produced by him and marked as Ex.D2. The same will make probable the case of the petitioner herein/accused that for the entire amount covered by Ex.D2-receipt, granite stones were supplied and only on completion of such supply, the receipt was returned to the petitioner herein/accused.

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It is the clear case of the petitioner herein/accused that the son of the respondent herein/complainant, who was running Andavar Granites, has refused to take delivery of the granite stones which were made ready for being delivered to them, on the contention that the stones were not up to the standard expected by them; that subsequently, when the petitioner herein/accused had made arrangements for selling the said granite stones to another company, Andavar Granites people again wanted to take delivery of those granite stones which were sought to be rejected by them earlier; that even at that point of time, the people of M/s.Andavar Granites insisted upon a condition that all the granite stones excavated by the petitioner's company in his quarry should be supplied only to Andavar Graites; that under such circumstances company run by the petitioner herein/accused supplied balance granite stones and thus made the supplies to cover the total amount covered by Ex.D2-receipt and received back Ex.D2-receipt and that thereafter, the petitioner's company closed its business with Andavar Granites and that the same happened to be the reason for extracting the cheque from the petitioner herein/accused with the help of the police personnel and filing the false complaint.

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Apart from the fact that the presence of original receipt in the hands of the petitioner herein/accused would make the defence theory of the petitioner herein/accused probable, there are also other factors, which will go to show that the case of the petitioner herein/accused is probable. Admittedly, the respondent herein/complainant lodged a complaint with police and the police conducted an enquiry. The said complaint was lodged on 29.03.2006. P.W.1 himself, during cross-examination, has admitted that he lodged a complaint with the police in the Office of the Commissioner of Police on 29.03.2006. It is pertinent to note https://hcservices.ecourts.gov.in/hcservices/ that, according to P.W.1's version, for the balance amount after

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deducting the value of the granite stones supplied from the amount covered by the receipt, Ex.P1 - cheque was issued by the petitioner herein/accused on 27.03.2006 itself. If it was so, there would not have been any necessity to lodge a complaint with the police within two days thereafter, namely on 29.03.2006. What were the contents of the complaint, is not known. Copy of the complaint has not been produced by the respondent herein/complainant. Admittedly, no FIR was registered based on the said complaint. Had an FIR been registered, then the petitioner herein/accused would have got a copy of the FIR and he would be in a position to produce the same to show under what circumstances and with what averments the complaint was given. On the other hand, the evidence of P.W.1 goes contra to the pleading made in the complaint.

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It is the further case of the complainant that the petitioner herein/accused issued Ex.P1-cheque and requested the respondent herein/complainant not to present it before 20.08.2006 and that hence the same was presented in bank for collection on 22.08.2006. If it was so, there was no necessity for the respondent herein/complainant to lodge a complaint with the police on 29.03.2006. The said aspect was not properly considered by the courts below. Had it been properly considered, then the only conclusion that could have been arrived at is that the defence case of the petitioner herein/accused that the cheque was extracted from the petitioner herein/accused with the help of the police personnel using the respondent's/complainant's acquaintance with them as he himself happened to be a retired police personnel and that the cheque was thus obtained by coercion on 29.03.2006 ante-dating the same to 27.03.2006, is more probable than the complainant's version.

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It is also pertinent to note that the petitioner herein/accused, complaining harassment at the instance of the respondent herein/complainant by the police personnel, filed a petition seeking anticipatory bail before this court in Crl.O.P.No.8913/2006 and the same was dismissed based on the representation of the police that the complaint was treated as a petition and the same was closed on 12.04.2006 itself after enquiry. A certified copy of the order passed by this court on 17.04.2006 in the above said Criminal Original Petition has been produced and marked as Ex.D1. After having the said anticipatory bail petition dismissed on the premise that no case was pending as the complaint itself was closed after enquiry, the respondent herein/complainant seems to have waited for four more months, then presented the cheque for collection and thereafter preferred the private complaint for the offence under Section 138 of the Negotiable Instruments Act, 1881. In this regard, no acceptable explanation explaining the sequence of the said events is forthcoming from the respondent herein/complainant. On the other hand, the petitioner herein/accused has come forward with an https://hcservices.ecourts.gov.in/hcservices/ explanation that, since it was represented by the police before the

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High Court itself that the complaint had been closed after enquiry and the Assistant Commissioner of Police promised him to get back the cheque in question, he did not prefer any complaint against the police personnel and did not issue any notice. It is true that for the statutory notice issued by the respondent herein/complainant under Ex.P4, the petitioner herein/accused did not issue any reply. The mere fact that no reply was issued, will not amount to an admission of the case of the respondent herein/complainant.

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If all the evidence, both oral and documentary, adduced on both sides, are considered in proper perspective, the only conclusion that can be arrived at is that the petitioner herein/accused has adduced more than sufficient evidence to rebut the presumption contemplated under Section 139 of the Negotiable Instruments Act, 1881; that the burden once again stands shifted on the respondent herein/complainant to prove the charge beyond reasonable doubt and that the respondent herein/complainant has failed to prove the charge beyond reasonable doubt. Not even on preponderance of probabilities the respondent/complainant has proved his case. Both the courts below have committed a grave error in not properly considering the above said aspect and hence this court does have no hesitation to hold that the conviction recorded by the trial court and its confirmation by the appellate court are infirm and defective and the same cannot be sustained. For all the reasons stated above, this court comes to the conclusion that the the conviction of the petitioner/accused for an offence under Section 138 of the Negotiable Instruments Act, 1881 and the sentence imposed thereon do not withstand the scrutiny of this court and this court, does have no hesitation in setting aside the same.

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In the result, the Criminal Revision Case succeeds and the conviction recorded and the sentence imposed by the trial court and confirmed by the lower appellate court, for the offence under Section 138 of the Negotiable Instruments Act, 1881, is hereby set aside. The petitioner herein/accused is acquitted of the offence with which he stood charged. The fine amount paid, if any, is to be refunded to him. Consequently, the connected Criminal Miscellaneous Petitions are closed.

Sd/Asst.Registrar.

/true copy/

Sub Asst.Registrar

asr/

https://hcservices.ecourts.gov.in/hcservices/

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The Additional District Sessions Judge (Fast Track Court No.2), Poonamallee

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The Judicial Magistrate No.II, Poonamallee 2 ccs to M/s. A. Lakshmi Raj Rathinam, Advocate, Sr. 17694 1 cc to Mr.C,.N. Raman, Advocate, Sr. 17974 Crl.R.C.No.972 of 2010

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RK (CO) kk 30/3

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https://hcservices.ecourts.gov.in/hcservices/

D.Karthikeyan v. M.Selvaraj

Case brief

What is this about?

What did the court decide?

D.Karthikeyan v. M.Selvaraj

Case brief

What is this about?

What did the court decide?

What the court decided

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