Allowed

N.Hariharan Nair v. Anitha P.Nair

Madras HC25 Oct 2021CRL A/385/2015

Case brief

AI extract

What is this about?

The High Court dismissed an appeal against a conviction under Section 138 NI Act. It held that the lower appellate court erred in not applying statutory presumptions and restored the trial court's conviction and sentence after finding the defence evidence unreliable and contradictory.

What did the court decide?

The order of acquittal passed by the VI Additional Sessions Judge is set aside, and the order of conviction and sentence by the VII Metropolitan Magistrate is restored.

N.Hariharan Nair Vs Anitha P.Nair — Cheque Dishonour | Madras HC (2021)

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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RESERVED ON : 23.09.2021

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PRONOUNCED ON : 25.10.2021

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CORAM:

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THE HONOURABLE MR.JUSTICE RMT.TEEKAA RAMAN

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Crl.A.No.385 of 2015

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N.Hariharan Nair

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... Appellant/Complainant

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Vs.

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Anitha P. Nair ... Respondent/Accused

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Prayer: This Criminal Appeal has been filed under Section 378 of Cr.P.C. to set aside the order passed by the learned VI Additional Sessions Judge, Chennai in Crl.A.No.43 of 2013 vide its order dated 12.01.2015 and to confirm the order passed by the learned VII Metropolitan Magistrate, George Town, Chennai, in C.C.No.9501 of 2005 giving conviction and sentence of six months simple imprisonment and payment of compensation of the cheque amount of Rs.1,50,000/- against the respondent/accused.

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For Appellant : Mr.K.Sakthivel

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For Respondent : Mr.T.V.G.Kartheeban

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JUDGMENT

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Unsuccessful private complainant is the appellant herein.

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2.For the sake of convenience, parties are referred to as per the ranking before the Trial Court.

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3(a).The private complainant has filed a case in C.C.No.9501 of 2015 under Section 200 of Cr.P.C for the alleged offence under Section 138 of the Negotiable Instruments Act, before the learned VII Metropolitan Magistrate, G.T. Court, Chennai, based upon Ex.P1/Cheque for a sum of Rs.1,50,000/-.

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3(b).After the trial, the learned Metropolitan Magistrate had convicted the accused for the offence under Section 138 of

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the Negotiable Instruments Act and sentenced him to undergo six months simple imprisonment and to pay a sum of Rs.1,50,000/- as compensation.

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3(c).Aggrieved against the said order, the accused had preferred Criminal Appeal in C.A.No.43 of 2013 before the VI Additional Sessions Judge, City Civil Court, Chennai. On, reappreciation of the evidence, the appeal filed by the convicted accused was allowed and he was acquitted.

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3(d).Against the order of acquittal passed by the Appellate Court, the private complainant has filed the present Criminal Appeal before this Court.

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4.The case of the complainant is that on 03.04.2005, the accused approached him and requested for a hand loan for a sum of Rs.1,50,000/- to meet her emergent family requirement. Towards the discharge of the debt, the accused issued a cheque bearing No.041626 dated 05.06.2005 for the said sum of Rs.1,50,000/- drawn on District Co-operative Bank Ltd., Puthenchanthai Branch, M.G.Road, Thiruvananthapuram. When the complainant presented the cheque before his banker namely Indian Bank, High Court, Extension Counter Chennai, for encashment, the same was returned as 'Funds Insufficient' on 14.06.2005. Therefore, the complainant had issued legal notice to the accused on 06.07.2005 and the said notice was received by the accused on 09.07.2005. After receiving the legal notice the accused sent a reply notice on 13.07.2005 but the accused did not pay any amount. Therefore, the complainant has filed the private complaint against the accused for the offence under Section 138 of the Negotiable Instruments Act with the prayer for compensation under Section 357(3) Cr.P.C.

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5.Before the Trial Court, on behalf of the complainant PW1 to PW3 were examined and Exs.P1 to P11 were marked. On behalf of the defence one Sunil Kumar was examined as DW1 and Exs.D1 & D2 were marked.

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6.The case of the accused is that her husband underwent a surgery so borrowed an amount of Rs.50,000/- from advocate one Saji, who is the partner of Jose Finance. While he was admitted in the hospital, his wife gave a cheque to Saji. Jose Finance has 6 unfilled signed cheques in their possession. Jose Finance instituted a case and he was acquitted in the said case. One Hariharan Nair filed the case against his wife. He is unaware of Hariharan Nair. 06.02.2002 dated medical documents were marked as Ex.D1. The Judgment of Neyyanttinkara Criminal Court in C.C.No.1122/2006 was marked as Ex.D2.

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7.In order to substantiate Ex.P1/Cheque, PW3/Dr.Kadirvel

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was examined, who could deposed that he had paid a sum of Rs.1,50,000/- towards loan for satisfying the accused borrowal.

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8.The complainant was examined as PW1. It is the specific case of the complainant that the accused approached him on 03.04.2005 and requested for a hand loan of Rs.1,50,000/- with an assurance of repayment within a month. The complainant asserts that he arranged loan from on his friend Dr.Kadirvelu (PW3) and paid the amount to the accused. It is the further case of the complainant that when he demanded the amount after a period of one month, the accused alleged to have issued a cheque bearing No.041626 dated 05.06.2005 for a sum of Rs.1,50,000/drawn one Thiruvananthapuram District Co-operative Bank Ltd.

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9.The suggestive case of the defence is that the complainant is totally stranger and that he had given some signed cheques to one Saji who has manipulated the said cheques and filed this complaint through the complainant. In view of the reversal in finding, this Court proposed to deal with the evidence of DW1.

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10.The defence taken by the accused in Ex.P8/reply notice is that she had no transaction with that of the complainant and she never had any occasion to see the face of the complainant in her life and however she never entered into the witness box. Further, it has been stated in the reply notice that the husband of the accused one Sunil took loan of Rs.50,000/- from one Saji and said to have repaid the same and the said Saji said to have obtained a blank cheque which is alleged to have been filled up. Further, her husband has been examined as DW1.

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11.The execution of Ex.P1/cheque has not been disputed. But it is the specific allegation that it was given to one Saji as a security. When DW1 in the witness box has come forwarded with a version that in the year 2002 while he was hospitalized for an operation, he borrowed a sum of Rs.50,000/- from one Saji of Jose Finance and his wife alleged to have issued a cheque to the said Saji. But no iota of evidence to prove that there exist an entity by name Jose Finance and a partner by name Saji. How the complainant is related to the said Saji and Jose Finance not explained by the accused. DW1 has categorically stated that he is unaware of the relationship. So making allegation that the present cheque was issued to one Saji is quite unacceptable.

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12.From the recital of Ex.P8/reply notice, would go to show that a cheque was issued to one Saji, but DW1 while in the witness box has stated as if six cheques were issued to one Saji. Available evidence would go to show that already some persons preferred cases against the accused as to issuance of cheque. Apart from that no cogent evidence adduced to

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substantiate the point that unfilled cheques were issued to one Saji of Jose Finance on a particular period.

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13.Further, in Ex.P8/reply notice, it has been stated as if amount of Rs.50,000/- was borrowed and cheque was issued before two years. So as per Ex.P8 the alleged issuance of unfilled cheque would be of the year 2003. But contradictory to the same DW1 while in the witness box has categorically stated that he borrowed the amount of Rs.50,000/- from one Saji while he underwent a surgery in the year 2002 and his wife issued a cheque while he was admitted in the hospital. Here Ex.D1 Discharge Summary would go to show the date as 30.01.2002.

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14.The statement given by DW1 in STC.No.145/2010 has been marked as Ex.P11. DW1 has categorically admitted the contents of Ex.P11 and his statement that he obtained loan from Jose Finance in the year 2001.

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15.So from the available evidence it is obvious that the accused is not specific about the year of the alleged borrowal and issue of unfilled cheque to one Saji, hence there is contradiction as to the year of the alleged issuance of unfilled cheque.

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16.Based upon the above evidence, the trial Court has rendered a finding that as per the defence theory, the present cheque bearing No.041626 also one among those cheques issued to one Saji. But this has been falsified by the own testimony of DW1. DW1 while in the witness box has categorically stated the cheque number of six cheques alleged to have been issued to one Saji. The present cheque concerned with the present case does not finds a place in it. The relevant portion of the evidence of DW1 is excerpted below.

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“rp/rp//1122//06 vd;w tHf;fpy; bea;ahw;wpd; fiu ePjpkd;wj;jpy; U:.50.000/- n$h!; igdhd;!plk; bfhLf;fg;gl;l fhnrhiyfs;jhd; 6 fhnrhiy vd;W rhl;rpak; mspj;Js;nsd; vd;why; rupjhd;/ 6 fhnrhiyfshd 001432. 001433. 001434. 004715. 177564. 030938 vd;why; rupjhd;/ ”

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So the present cheque bearing No.041626 does not finds a place in the alleged six cheques issued to the alleged Jose Finance. So the defence taken by the accused is falsified by their own evidence.

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17.DW1 himself admits that he made allegations against one Saji without any basis and substance and he does not have anything to show that the alleged Saji is a partner of Jose finance.

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18.The respondent in her reply notice claims that she borrowed the amount from Saji in the year 2003 and the same has been affirmed by DW1/husband of the respondent in his evidence, whereas his stand in C.C.No.1122 of 2006 is that she borrowed amount from alleged Jose finance in the year 2002 and in STC.No.145 of 2010 he says that he borrowed the amount from Jose finance in the year 2001. Further, DW1 himself deposes that until then there was only one transaction with alleged Jose finance either it be by him or by his wife and even assuming without admitting that to be true, only six cheques are issued for that transaction and these six cheques forms part of the case relied on by the respondent and the cheque involved in this case have no nexus with those transactions.

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19.The execution of the cheque is proved and the respondent has already admitted the execution of the cheque and admitted by her witness DW1 (who is none other than the husband) also assumes significance.

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20.Points for consideration:

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(i)So long as accused does not dispute genuine of signature on cheque.

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(ii)Body of the cheuqe need not necessarily be written by the accused and it can be in hand writing of anybody else or typed.

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(iii)whether the cheque in issue is written by the accused or got it typed is immaterial when there is no denial of signature by the accused.

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21.In the case on hand also there is no dispute as to the signature of the accused in the cheque. So the fact that Ex.P1/cheuqe has been typed is immaterial.

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22.In the decision reported in 2008 (1) CTC 491 – S.Gopal Vs. D.Balachandran, this Court has held that Section 20 of the Negotiable Instruments Act applies not only to a stamped instruction like promissory note and bill of exchange and to blank cheuqe issued after signature of drawer. But does not prescribe that drawer alone should fill up cheque. A blank cheuqe singed by drawer and filled up by third person for negotiating the same is vaild. It is open for the drawer of the cheque of to give authority to payee or holder in due course to fill up cheque signed by him and such instrument is valid in eye of law.

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23.In view of the discussions in the preceding paragraphs, this Court finds that the appellant/private complainant has successfully demonstrated essential ingredients to raise for statutory presumption under Section 139 of Negotiable

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Instruments Act. And thus it is for the respondent/accused to rebut the presumption to the level of preponderance of probability.

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24.As discussed supra, the version of DW1 (husband of the accused) is totally runs contrary to his reply notice. The signature in the cheque and the cheque is as that of the accused are not disputed. In the decision reported in 2019 (4) SCC 197 – Bir Singh Vz. Mukesh Kumar, the Hon'ble Apex Court has observed as follows:

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“33.A meaningful reading of the provisions of the Negotiable Instruments Act including, in particular, Sections 20, 87 and 139, makes it amply clear that a person who sings a cheque and makes it over to the payee remains liable unless the adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be atracted.

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36.Even a blank cheque leaf, voluntarily signed and haded over by the accused, which is towards some payment, would 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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38.In the absence of any finding that the cheque in question was not signed by the respondent-accused or not voluntarily made over to the payee and in the absence of any evidence with regard to the circumstances in which a blank singed cheque had been given to the appellant complainant, it may reasonably be presumed that the cheque was filled in by the appellant complainant being the payee in the presence of the respondent-accused being the drawer, at his request and/or with his acquiescence. The subsequent filling in of an unfilled signed cheque is not an alteration. There was no change in the amount of the cheque, its date or the name of the payee.”

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25.On going through the evidence and on going through finding rendered by the Lower Appellate Court, I find that the presumption under Section 118 and 139 of Negotiable Instruments Act was not properly considered by the Lower Appellate Court and the approach adopted by the Lower Appellate Court as if it is the duty of the complainant to prove the “debt” as required before the Civil Court, is erroneous.

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26.Such approach has been depricated by the Hon'ble Suprme Court in decision reported in 2019 (10) SCC 287 – Uttam Ram Vs. Devinder Singh Hudan and Another, wherein, the it has been held that in view of the presumption as contemplated under Sections 118 and 139 of the Negotiable Instruments Act, the private complainant is entitled for statutory presumption and on being satisfied essential ingredients as contained therein and it is not required for the private complainant to prove, as if, it is a recovery of money suit in a Civil Court.

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27(a).It appears that the finding rendered by the Lower Appellate Court is runs contrary to the above said decision in the case of Uttam Ram as stated supra and the same is held to be error in law and hence, the perverse finding rendered by the Lower Appellate Court that the complainant is not entitle for presumption is also found to be perverse finding and hence, in view of the reasons stated supra, such a finding rendered by the Lower Appellate Court is liable to be vacated since it suffers from perversity and error of law.

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27(b).Consequently, such finding in the judgment of the Lower Appellate Court in Crl.A.No.43 of 2013, dated 12.02.2015 is hereby vacated and a proper finding given by the learned Magistrate, for different reasons discussed in the preceding paragraphs is restored.

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27(c).Consequently, this Court has no hesitation to come to the conclusion that the private complainant is entitled for presumption under Section 139 of the Negotiable Instruments Act and the evidence of DW1 does not established even an iota evidence in support of their stand. Besides, the stand of the defence is different from the reply statement that are mutually destructive of each other and the defence has not probablised the suggestive case to the level of preponderance of probability.

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27(d).Accordingly, this Court has no hesitation to hold, on

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failure by the defence to probablise the suggestive case and in view of statutory presumption held to be in favour of private complainant, the charge is held to be proved. Resultantly, the conviction under Section 138 of the Negotiable Instruments Act against the defendant as laid by the Trial Court is hereby restored.

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28.In the result, this Criminal Appeal stands allowed and the order of acquittal passed in C.A.No.43 of 2013 by the learned VI Additional Sessions Judge, Chennai, dated 12.01.2015 is hereby set aside and the order of conviction and sentence passed by the learned VII Metropolitan Magistrate, George Town, Chennai in C.C.N.9501 of 2015, dated 18.01.2013, is hereby restored.

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Sd/-

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Assistant Registrar(CS-VI)

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//True Copy//

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Sub Assistant Registrar

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dua

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To: