Allowed

Mohammad Khaja v. The State of Telangana

Telangana HC20 Jul 2022CRLP/1943/2019

Case brief

AI extract

What is this about?

The High Court of Telangana allowed criminal petitions to set aside a trial court order. The Court held that the accused were permitted to examine witnesses to prove that dishonored cheques were issued as security for share transfer rather than for debt discharge, thereby rebutting the statutory presumption under Section 139 of the NI Act.

What did the court decide?

The impugned common order dated 11.03.2019 dismissing the applications to examine witnesses was set aside and the criminal petitions were allowed.

Mohammad Khaja Vs The State of Telangana — Cheque Dishonour | Telangana HC (2022)

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IN THE HIGH COURT FOR^{THE STATE OF TELANGANA} AT HYDERABAD

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WEDNESDAY ,THE TWENTIETH^{DAY OF JULY} TWO THOUSAND AND TWENTY^TWO

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PRESENT

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THE HONOURABLE DR. JUSTICE^D.NAGARJUN

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CRIMINAL PETITIO N^{NO: 1943,1935 & 1963 0F 2019}

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CRIMINAL PETITION NO: 1943^{OF 2019}

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Between:

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Mohammad Khaja, S/o. Abdul Quddus,^Aged years, occ. Rr/o. H.No.1-4-879lC, Bakaram, Musheerabad,^{Hyderabad-20,} Office at.1-4-880/A, Bakaram, Musheerabad, Hyderabad-20.

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...PETITIONER/ACCUSED

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AND

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1 The State of Telangana, through^{Public Prosecutorof HighCourt at} Hyderabad.

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2 M/s. Pioneer Tor Steels Mills^{(P) Ltd, Registered Office at . D-203, Aditya} Elite, BS Maktha, Near^{Keertilal Jewellers, Somajiguda, Hyderabad-82,Rep.} bv its authorized representative,^{Ch. Krishnama Charyulu, S/o. Ch. V.} N'arasimhacharyuh,i, aged^{45 years,Occ. Manager (Admn.)}

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...RESPONDENT/COMPLAINANT

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Petition under Section 482 of^{cr.P .c prayingthat in the circumstances} stated in the Memorandum of^{Grounds of criminal Petition, the Highcourt may} be pleased to^quash common^{orderdated111312019 in Crl.M.P.no.744112018} in c.c. No.2o2t2o15 on the file of the^{court of the Vl special Magistrate,} Hyderabad.

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l.A. NO: 1 OF 2019

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Petition under Section⁴⁸² of^{Cr.P.C prayingthat in the circumstances} stated in the Memorandum^{of Grounds of criminal Petition,the High court may} be pleased To stay all further^{proceedings in c.c. No.20212015on the file of the} court of the Vl special Magistrate,^{Hyderabad pursuant to common order dated} 11t312019 in crl.M.P. no.7441t2O1B^{in c.c. No.202120150n the file of the court} of the Vl special Magistrate,^{Hyderabad, pending dlsposalof this criminal} Petition .

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This Petition coming on^{for hearing,upon perusing the Memorandum of} Grounds of criminal Petition^{and upon hearingthe argumentsof sri VIVEK JAIN}

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,Advocate^for the^{Petitionerand the PublicProsecutoron behalf of the} Respondent No.1 ancl of Sri GAJI SRINIVAS Advocate^for the^{Respondent No. 2.}

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CRIMINAL PETITION NO: 1935 OF 2019

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Between:

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Mohd. Saleem, Mohd. Saleem, S/o. Abdul Quddus, Aged^{years,OccRl/o.} H.No.1-4-879lC, Bakaram, Musheerabad, Hyderabad-20 Office at^1-4-8B0iA, Bakaram, Musheerabad, Hyderabad-20.

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...PETITIONER/ACCUSED

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AND

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The State of Telangana, through Public Prosecutor of High Court^at ...RESPONDENT

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Hyderabad

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M/s. Pioneer Tor Steels Mills (P) Ltd, Registered Office at^- D-203, Aclitya Elite, BS Maktha, Near Keertilal Jewellers, Somajiguda, Hyderabad-82,^Rep by its authorized representative, Ch. Krishnama Charyulu, S/o.^{Ch. V.} Narasimhacharyulu, aged 45^years, Occ-Manager^(Admn.)

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...RESPONDENT/COMPLAINANT

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Petition under Section 482 of Cr.P.C^praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High^Courtmay be pleased to quash Common Order dated 11-3-2019 in Crl.M.P. no.743912018 in C.C. No.1BB/2015 on the file of the court of the Vl Special Magistrate, Hyderabad and be^pleased to^pass such other orders as the^{Hon'ble court may} deem fit and proper in the interest of^justice,

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l.A. NO: 1 OF 2019

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Petition under Section 482 of Cr.P.C^praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition,the High Court may be pleased To stay all further^proceedings in C.C. No.1BB12015 on the file of the court of the Vl Special Magistrate, Hyderabad^pursuant to common Order dated 11-3-2019 in Crl.M.P. no.743912018 in C.C. No.18812015 on the file of the court of the Vl Special Magistrate, Hyderabad,^pending disposal of this Criminal Petition .

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l.A. NO: 2 OF 2020

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Petition under Section 482 of Cr.P.C^praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition,the High Court may be pleased to extend the interim order dated 0211212019 passed in CRLP No. '1935 of 2019 until further orders in the interest of justice

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l.A. NO: 3 OF 2020

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Petition under Section 482 of Cr.P.C praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition,the High Court may

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be pleased to extend the interim^{order dated0211212019 passedin CRLPNo'} 1935 of 2019 until further orders in the interest^of iustice

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This Petitlon coming on for hearing,upon^{perusingthe lt/emorandum of} Grounds of Criminal Petition and upon hearing^{the argumentsof Sri VIVEK JAIN} ,Advocate^{for the Petitioner and the PublicProsecutoron behalf of the} Respondent No.1 and of Sri GAJI SRINIVAS^{Advocate for the Respondent No. 2}

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CRIMINAL PETITION NO: 1963 OF²⁰¹⁹

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Between:

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Mohd. fvlasood Ahmed, S/o. Md.^{l\4ahboob Ali, R/o. H.No.'l-4-879lC,Bakaram,} lvlusheerabad, Hyderabad-20, Office at^{1-4-880/A, Bakaram,Musheerabad,} Hyderabad-20.

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...PETITIONERYACCUSED

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AND

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1 . The State of Telangana, through^{Public Prosecutorof High CpU( qt} Hyderabad '.RESPONDENT

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l{tts. Pioneer Tor Steels Mills^{(P)Ltd, Registered Office at . D-203'AOira Elite'} BS Maktha, Near Keertilal Jewellers, Somajiguda,^{Hyderabad-82 Rep. by its} authorized representative, Ch.^{Krishnama Charyulu, S/o. Ch. V.} Narasimhacharyulu,aged 45^years, Occ.^{Manager(Admn')}

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...RESPONDENT/COMPLAINANT

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Petition under Section 482 of Cr.P.C^{prayingthat in the circumstances} stated in the Memorandum of Grounds of^{Criminal Petition, the HighCourtmay} be pleased to^quash Common Order^{dated11-3-2019 in Cr|.M.P.no.744012018in} C.C. No.201l2015 on the file of the court of^{the Vl Special [t/agistrate,} Hyderabad.

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l.A. NO: 1 OF 2019

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Petition under Section 482 of Ct.P.C^{prayingthat in the circumstances} stated in the Memorandum of Grounds of^{Criminal Petition,the High Courtmay} be pleased to stay alt further^{proceedings in C.C. No.201/20'15 on the file of the} court of the Vl Special Magistrate,^{Hyderabad pursuant to common Order dated} 11-3-2019 in Crl.M.P. no.744Ol201Bⁱⁿ C.C.^{No.20112015on the fite of the court} of the Vl Special tvlagistrate, Hyderabad,^{pending disposalof this Criminal} Petitio n.

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l.A. NO: 3 OF 2020

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Petition under Section 482 of Cr.P.C^{prayingthat in the circumstances} stated in the Memorandum of Grounds of.^{Criminal Petition,the High Courtmay} be pleased to extend the interim order dated^{2610912019 passedin CRLP No} '1963 of 20'19 until further orders in the interest of justice

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This Petition coming on for hearing,upon^{perusingthe Memorandum of} Grounds of criminal Petition and upon^{hearingthe argumentsof sri VIVEK JAIN} ,Advocate^{for the Petitionerand the Public Prosecutoron behalf of the} Respondent No.1 and of Sri GAJI SRINIVAS^{Advocatefor the RespondentNo.2}

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The Court made the following: ORDER

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THE HONOURABLE DR, JUSTICE D. NAGARJUN

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CRIMINAL PETITION Nos.1943, 1935 & 1963 of 201.9

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COMMON ORDER:

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These petitions are fiied to quash the common order dated 11.03.2019 in Cr1.M.P.No.744l of 2018 in C.C.No.202 of 2015, Cr1.M.P.No.7439 of 2OlB in C.C.No.188 of 2015 and Crl.M.P.No.744A of 2018 in C.C.No.2O1 of 2015 on the file of the VI Special Magistrate, Hyderabad, filed by the respondent/ complainant against the petitioners/ accused.

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The brief facts leading to fi1ing of these petitions are

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mentioned as under

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The respondent/complainant has filed C.C.No.2O2 of ., 2015 alleging that the petitionersfaccused have given him cheques in discharge of their debt and that when he presented them in the bank, they were returned dishonored as "insufficient funds"" Aggrieved by the salne, on completion of ali formalities, the respondent/complainant has filed complaints in C.C.Nos.202, 188 and 2Ol of 2015 under Section 138 of the Negotiable Instruments Act (for short, "the Act").

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During the course of trial, the respondent/complainant has completed his part of evidence. On behalf of the petitioners/ accused, the petitioners themselves have examined as DWl and marked the documents. The petitioners/accused have a-lso fited applications for sending the disputed documents to hand writing expert and same was also declined by the trial Court. When the matter was posted for further evidence on behalf of the petitioners/accused, the petitioners have filed Cr1.M.P.Nos.744l, 7439 and Z44O of 201g for issuance to summons to two witnesses for examining them on their behatf. After full-fledged enquiry, the triar court has dismissed the said applications by way of common order dated 1i.03.2019. Aggrieved by the sarne, the present petitions are filed.

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According to the petitioners/accused, those two witnesses are required to be examined in order to prove their defence that the cheques in dispute were given to the respondent/complainant as a securit5r and by misusing them, the respondent/complainant has filed the false cases against them.

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On the other hand, the submissions ol learned counsel^for the respondent/complainant is that the petitioners have^given those cheques in discharge of the debt and not as a security,^as contended. In respect of the witnesses sought to be examined by the petitioners/ accused, the submissions of the learned counsel for the respondent/complainant are that the^two witnesses are the attestors of the Memorandum^of Understanding (MOU) dated O7.lO.2Ol2 entered into^between the parties and the petitioners/accused have not disputed^the MOU dated 07.lO.2Ol2 and that both the witnesses are^the Chartered Accountants and are shown as Arbitrators in^the MOU, and therefore, their evidence cannot be considered.

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Heard both sides and perused the record.

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Now, the point for determination is whether the impugned common order dated 11.03.2019 passed Crl.M.P.No.7441 of 2018 in C.C.No.2O2 of 2015, Crl.M.P.No.7439 of 2018ⁱⁿ C.C.No.188 of 2O 15 and Cr1.M.P.No.7440 of 20 18 in C.C.No.201 of 2015 on the file of the VI Special Magistrate, Hyderabad, can be quashed?

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Perused the orders passed by the learned trial Court. The main ground on which the trial court has declined to consider the request of the petitioners is that those two witnesses are the witnesses of the respondent/complainant, as they are shown as witnesses to the MOU dated OZ.lO.2Ol2 (Ex.p. 11) and also to the addendum (Ex.p. 12) and that both of them jointly operate the account as arbitrators. The other ground on which the petitions were dismissed was that the petitioners/accused have not disputed the MoU under Ex.p. 11 to which the witnesses a-re proposed to be examined as attestors and also acting as arbitrators and when there is no dispute with regard to the MOU and addendum under Ex.p. 12, the petitioners cannot examine them to prove the contents of the said documents.

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On hearing both sides and going through the orders of the learned trial court, it is clear that the trial court was totally mislead in appreciating the issue before the Court. The simple case of the petitioners/accused is that the cheques, which were dishonoured, were not given to respondent/complainant in discharge of debt and it is asserted that btank cheques were given to the legrondent/complainant as security in the

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)

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presence of the witnesses, thereby in order to prove the same, the petitioner/ accused proposed to examine them.

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The trial Court has concluded that since MOU is not in dispute, their evidence is not necessary. It is true that there is no dispute about the execution of MOU and that in the MOU there is no mention about the disputed cheques. There is also no mention that at the time of execution of two blank cheques were given by the petitioners/accused to the respondent/complainant. But however, it is the stand of the petitioners/ accused that even though there is no mention in the MOU that at the time of execution of MOU, blank cheques were given in respect of shares towards the consideration of the shares to be transferred, the blank cheques were given.

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Merely, because there is no mention in the MOU about cheques, it cannot be said that the witnesses cannot be examined. Whether the cheques were given in discharge of legally enforceable debt or given towards consideration for the shares, are the questions to be decided by the trial Court. In case, in the presence of those witnesses, the cheques in dispute

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are ffi given by the petitioner/accused to

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respondent/complainant, then the witnesses would certainly speak that the cheques are not given in their^{presence, which} would falsify the contention of the petitioners/accused.

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This Court is unable to understand as to why the respondent/complainant is opposing examination of witness by the petitioner/accused. In order to prove their case, the respondent/complainant has submitted both oral and documentary evidence. Similarly, the petitioners/accused, shall also get an opportunity to examine the witnesses.^Once witnesses come to the witness box, the respondent/ complainant will get an opportunit5z to crossexamine the witnesses, thereby the respondent can certainly confront with whatever questions they want in order to disprove the contention of the petitioners/accused.^Therefore, conclusion of the trial Court that since there is no mentionⁱⁿ the MOU that the cheques are^given in their^{presence, sincethe} petitioners/accused are not disputing the MOU and other additional MOUs, the witnesses cannot be examined^{before the} Court as defence witnesses cannot be accepted.

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The trial Court has already observed that the witnesses sought to be examined by the petitioner/ accused are the witnesses of the respondent/compiainant. It is not the case of the respondent/ complainalt that these two witnesses are shown as witnesses of the respondent/complainant. In fact, the respondent/complainant has completed their part of evidence. That means, the respondent/complainant has not chosen to examine them. Hence, the petitioner/accused can certainly examine them. The MOU is signed by both the petitioners and the respondent. Merely, because the respondent/ complainant has filed MOU before the Court along with the complaint under Section 138 of the Act, it cannot be said that the two witnesses, which the petitioner/ accused is proposing to examine, are the witnesses of the respondent/complainant. Even otherwise, if the witnesses to be examined are the witnesses of the respondent/complainant and if the respondent/complainant did not choose to examine them, then in the given circumstances, the petitioner/ accused can certainiy seek for the examination of the witnesses cited by the respondent/complainant on their behalf.

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In the considered opinion of this Court, the petitioners/ accused have got every right to examine those witnesses in order to prove their defence. The Court cannot shut the opportunity of the petitioners/accused to prove their CASC.

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Section 139 of the Negotiable Instruments Act reads as under:

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"139. Presumptioa in favour of holder.- It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other iiability. "

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Since the respondent/complainant has filed cheque duly signed by the petitioner/accused and examined himself and marked the cheque, the presumption under Section 139 of the Negotiable Instruments Act will be raised, thereby, the petitioner/accused will have to rebut the same by way of producing the evidence, or by proving the infirmities in the case of the respondent/complainant. Hence, in order to rebut the presumption under Section 139 of the Negotiable Instruments Act, the petitioner/accused shall be permitted to examine the proposed witness.

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17 . Considering the circumstances, the petitioners have made out a case to call lor the witnesses and therefore, these petitions are allowed and the common order dated 11.03.2019 in Crl.M.P.No.7441 of 2018 in C.C.No.2O2 of 2015, Crl.M.P.No.7439 of 2018 in C.C.No.188 of 2015 and Crl.M.P.No.744O of 2018 in C.C.No.2O1 of 20 15 on the fi1e of the VI Special Magistrate, Hyderabad, are hereby set aside.

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It is submitted by the learned counsel for the respondent/compiainant that the petitioners under the guise of examining the two witnesses, the petitioner/ accused intends to elicit certain facts, which would be prejudicial to the re spondent.

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Since the intention of the petitioner/accused is to examine the witnesses to prove that the disputed cheques are not given in discharge of money and are given only in blank as a remuneration of the shares expected to be tralsferred, the petitioners are expected to confine their evidence only to the extent of the dispute under Section 138 of the Negotiable Instruments Act. If at all the respond en)/ comOlatnant feels

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that the petitioner/ accused is leading any evidence, which are not concerned with the subject matter, the respondent can certainly raise objection on which the triat Court, basing on the facts and circumstances and the rules of evidence, shall take appropriate decision.

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Miscellaneous petitions, if any, shall stand closed.

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SD/-G.SIREESHA ASSISTA E S RAR //TRUE COPY// 0 SE

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To,

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TheVl Special l\4agistrate, Hyderabad.

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Two CCs to Public Prosecutor, High Court for the State of Telangana, at Hyderabad.(OUT )

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One CC to SRl. VIVEK JAIN Advocate [OPUC]

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One CC to SRl. GAJI SRINIVAS Advocate IOPUCI

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Two CD Copies

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One Spare Copy \ V

CDL

HIGH COURT

DATED:2010712022

COMMON ORDER

CRL.P.No .1943,1935 andl^{963 of 2019}

¶104

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¶105

ALLOWING THE CRIMINAL PETITION

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Mohammad Khaja v. The State of Telangana

Case brief

What is this about?

What did the court decide?

Mohammad Khaja v. The State of Telangana

Case brief

What is this about?

What did the court decide?

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