Patna High Court
Case Details
IN THE HIGH COURT OF JUDICATURE AT PATNA Criminal Revision No.544 of 2010 ====================================================== Arvind Kumar S/O Late Biyogi Lal Choudhary Residing At Present At 402 Tulip Cooperative Society,Mahada Building No.6,Mahada,Adarsh Nagar Andheri,West Mumbai And Permanent R/O Shahpur,P.S.-Tisiyoti, Dist.- Vaishali Versus .... .... Petitioner/s 1. The State Of Bihar 2. M/S Ashok Leyland Finance Through Shri Kashi Nath Rai,Branch Manager, Exhibition Road, P.S.-Gandhi Maidan,Dist.-Patna. .... .... Respondent/s ====================================================== Appearance : For the Petitioner/s : Mr. G.P.Bimal, Advocate For the Respondent/s : Mr. Brajendra Nath Pandey, APP. For the Opposite Party No.2 : Mr. Surendra Kishore Thakur, Advocate. ====================================================== CORAM: HONOURABLE MR. JUSTICE ADITYA KUMAR TRIVEDI CAV ORDER 13 8-07-2013 Petitioner/accused being aggrieved by and dissatisfied with an order dated 10.03.2010 passed by Smt.Shachi Mishra, Judicial Magistrate, Ist Class, Patna in Complaint Case No.220C of 2006(M/S Ashok Limited Finance through Kashinath Roy Vrs. Arvind Kumar)rejected the prayer of the petitioner to discharge him, filed instant revision petition. 2. It has been alleged by the complainant that accused/petitioner had purchased five tankers through the complainant under hire purchase agreement. In due course of time, a cheque bearing no.2883591 appertaining to Rs.62,60,000/- was issued by the accused on 24.12.2005 which bounced on its presentation before Bank 2 on account of insufficient fund and the same was intimated to the complainant on 05.01.2006. Accordingly, the complainant served with an Advocate notice on 06.01.2006 detailing the event as well as requesting to pay the amount within the stipulated period of fifteen days which was not at all honoured at the end of accused. On 11.01.2006 Nishant Kumar Sinha an employee was sent to the accused who also requested to make payment but failed to convince the accused. He also came to know that all the tankers were stealthily sold away by the accused. It has further been submitted that at the time of negotiation, the accused had undertook to pay the instalment regularly and putting belief upon his undertaking finance was provided. 3. After having the appearance of the petitioner/accused before the court below on account of taking of cognizance under Section 420 of the IPC as well as 138 of the Negotiable Instrument Act, the trial commenced and altogether two P.Ws. have been examined before charge as well as relevant documents including cheque, copy of the legal notice etc. have been made an exhibit of the record. Then thereafter, the case has been posted for charge at which stage, a prayer has been made on behalf of the petitioner to discharge him which after hearing both sides, the learned lower court rejected whereupon instant revision petition has been filed. 4. It has been contended on behalf of the petitioner that 3 neither an offence under Section 420 of the IPC nor 138 of Negotiable Instrument Act is made out from the evidence adduced on behalf of the complainant. To support his submission, the learned counsel for the petitioner drew attention towards complaint petition as well as evidence of two P.Ws and submitted that there happens to be no description or disclosure in the complaint petition as well as by the witnesses that at the time of negotiation petitioner/accused had carried fraudulent intention. In likewise manner, it has also been submitted that from the cross-examination of the P.Ws., it is evident that blank cheque was issued by the petitioner/accused as a surety which after getting filled up by the complaint side presented for encashment for which complainant was never authorized, nor before presentation petitioner was ever informed therefore neither the cheque in question happens to be an instrument in the eye of law nor the petitioner/accused could be held responsible for its dishonour. Also relied upon decisions reported in 1990 Cr. Law Journal 358, order dated 05.03.2009 passed in Cr.Misc.No.35648 of 2007 along with Cr.Misc.No.35651 of 2007, 2004 Cr.Law Journal 2443, 1989 Cr.Law Journal 1330, order dated 19.02.2009 passed in Cr.Misc.No.48092 of 2007 and on the basis thereof, submitted that it happens to be out and out a civil dispute therefore refusing prayer of the petitioner to discharge happens to be wrong, erroneous and is fit to be set aside. 4 5. At the other hand, the learned lawyer for Opposite Party No.2 submitted that at the present stage the Magistrate has to see only a prima-facie case which if unrebutted would lead conviction of the accused and for that, it has been submitted that ample material has been produced by the complainant to satisfy the requirement of law and are sufficient to record conviction in case is not rebutted. Therefore, the learned lower court had rightly rejected the prayer of the petitioner/accused. 6. Before coming to the issue in hand, on account of having cognizance under Section 420 of the IPC, 138 of the Negotiable Instrument Act, the proceeding is identifiable as a warrant trial whereunder the witnesses are to be examined before charge in accordance with Section 244 of the Cr.P.C. The procedure prescribed for warrant triable cases based on complaint has got difference than the police case. Under Section 244 of the Cr.P.C., though only examination of witness is prescribed followed with scope of discharge in accordance with Section 245 Cr.P.C and in case, the accused is not discharged, then the further proceeding has to be guided in accordance with Section 246 of the Cr.P.C. whereunder after framing of charge, the witnesses are to be cross-examined, re-examined as well as fresh witnesses are also to be examined. For better appreciation the relevant Sections are quoted below: 244. Evidence for prosecution - (1) When, in any warrant-case 5 instituted otherwise than on a police report the accused appears or is brought before a Magistrate, the Magistrate shall proceed to hear the prosecution and take all such evidence as may be produced in support of the prosecution. (2) The Magistrate may, on the application of the prosecution, issue a summons to any of its witnesses directing him to attend or to produce any document or other thing. 245. When accused shall be discharged - (1) If, upon taking all the evidence referred to in section 244 the Magistrate considers, for reasons to be recorded, that no case against the accused has been made out which, if unrebutted, would warrant his conviction, the Magistrate shall discharge him. (2) Nothing in this section shall be deemed to prevent a Magistrate from discharging the accused at any previous stage of the case if, for reasons to be recorded by such Magistrate, he considers the charge to be groundless. 246. Procedure where accused is not discharged - (1) If, when such evidence has been taken, or at any previous stage of the case, the Magistrate is of opinion that there is ground for presuming that the accused has committed an offence triable under this Chapter, which such Magistrate is competent to try and which, in his opinion, could be adequately punished by him, he shall frame in writing a charge against the accused. (2) The charge shall then be read and explained to the accused, and he shall be asked whether he pleads guilty or has any defence to make. (3) If the accused pleads guilty, the Magistrate shall record the plea, and may, in his discretion, convict him thereon. (4) If the accused refuses to plead, or does not plead or claims to be tried or if the accused is not convicted under sub-section (3) he shall be required to state, at the commencement of the next hearing of the case or, if the Magistrate for reasons to be recorded in writing so thinks fit, forthwith whether he wishes to cross-examine any, and if so, which, of the witnesses for the prosecution whose evidence has been taken. (5) If he says he does so wish, the witnesses named by him shall be recalled and, after cross-examination and re-examination (if any), they shall be discharged. (6) The evidence of any remaining witnesses for the prosecution shall next be taken and after cross-examination and re-examination (if any), they shall also be discharged. 7. Now coming to the present score, the stage is found to be guided by Section 245 of the Cr.P.C. whereunder the only consideration to the learned court in seisin of the matter is that in case 6 the evidence adduced before charge even unrebutted would not lead conviction of the accused, then in that event, the accused is bound to be discharged. Therefore, as per requirement of law, the only theme that has to be seen whether the evidence available on the record would lead in conviction in case is unrebutted.
Facts
8. Now coming to facts in hand first of all the scope of 420 IPC is taken. Neither in complaint petition nor during course of examination of both the witnesses it has been stated that the petitioner/accused had carried fraudulent or dishonest intention at the time of making promise or representation. In Harman Preet Singh Ahluwalia v. State of Punjab reported in 2009 Cr.L.J page 3462, it has been held:- ―12. For the purpose of constituting an offence of cheating, the complainant is required to show that the accused had fraudulent or dishonest intention at the time of making promise or representation. Even in a case where allegations are made in regard to failure on the part of the accused to keep his promise, in absence of a culpable intention at the time of making initial promise being absent, no offence under Section 420 of the Indian Penal Code can be said to have been made out. 13. We may reiterate that one of the ingredients of cheating as defined in Section 415 of the Indian Penal Code is existence of an intention of making initial promise or existence thereof from the very beginning of formation of contract. In Ajay Mitra v. State of M.P. (2003) 3 SCC 11, this Court held : 15. Section 420, IPC says that "whoever cheats and thereby dishonestly induces the person deceived to deliver any property to any person ... shall be 7 punished with imprisonment...". Cheating has been defined in Section 415, IPC and it says that : "415. Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to 'cheat'." 16. A guilty intention is an essential ingredient of the offence of cheating. In other words "mens rea" on the part of the accused must be established before he can be convicted of an offence of cheating. (See Jaswantrai Manilal Akhaney v. State of Bombay [AIR 1956 SC 574). In Mahadeo Prasad v. State of W.B. [AIR 1954 SC 724] it was held as follows (AIR paras 4-5) : Where the charge against the accused is under Section 420 in that he induced the complainant to part with his goods, on the understanding that the accused would pay for the same on delivery but did not pay, if the accused had at the time he promised to pay cash against delivery an intention to do so, the fact that he did not pay would not convert the transaction into one of cheating. But if on the other hand he had no intention whatsoever to pay but merely said that he would do so in order to induce the complainant to part with the goods then a case of cheating would be established." In Hira Lal Hari Lal Bhagwati v. CBI [(2003) 5 SCC 257], this Court held : "40. It is settled law, by a catena of decisions, that for establishing the offence of cheating, the complainant is required to show that the accused had fraudulent or dishonest intention at the time of making promise or representation. From his making failure to keep promise subsequently, such a culpable intention right at the beginning that is at the time when the promise was made cannot be presumed. It is 8 seen from the records that the exemption certificate contained necessary conditions which were required to be complied with after importation of the machine. Since the GCS could not comply with it, therefore, it rightly paid the necessary duties without taking advantage of the exemption certificate. The conduct of there was no the GCS clearly fraudulent or dishonest intention of either the GCS or the appellants in their capacities as office-bearers for right at exemption." time of making application indicates that the {See also Indian Oil Corporation v. NEPC India Ltd. and Ors. [(2006) 6 SCC 736]} In Vir Prakash Sharma v. Anil Kumar Agarwal the [(2007) 7 SCC 373], noticing, aforementioned decision, this Court held : inter alia, a civil dispute. Non-payment "8. The dispute between the parties herein is essentially or underpayment of the price of the goods by itself does not amount to commission of an offence of cheating or criminal breach of trust. No offence, having regard to the definition of criminal breach of trust contained in Section 405 of the Penal Code can be said to have been made out in the instant case." It was furthermore opined : "13. The ingredients of Section 420 of the Penal Code are as follows : (i) Deception of any persons; (ii) Fraudulently or dishonestly inducing any person to deliver any property; or (iii) To consent that any person shall retain any property and finally inducing that intentionally person to do or omit to do anything which he would not do or omit. No act of inducement on the part of the appellant has been alleged by the respondent. No allegation has been made that he had an intention to cheat the respondent from the very inception. 14. What has been alleged in the complaint petition as also the statement of the complainant and his witnesses relate to his subsequent conduct. The date when such statements were allegedly made by the appellant had not been disclosed by the witnesses of the complainant. It is really absurd to opine that any 9 such statement would be made by the appellant before all of them at the same time and that too in his own district. They, thus, appear to be wholly unnatural. 15. In law, only because he had issued cheques which were dishonoured, the same by itself would not mean that he had cheated the complainant. Assuming that such a statement had been made, the same, in our opinion, does not exhibit that there had been any intention on the part of the appellant herein to commit an offence under Section 417 of the Penal Code. 16. Furthermore, admittedly, their residences are in different districts. Whereas the appellant is a resident of the district of Ajamgarh, the respondent is a resident of the district of Rampur. Cheques were admittedly issued by the appellant at his place. There is nothing on record to show that any part of the cause of action arose within the jurisdiction of the court concerned. Even if such statements had been made, the same admittedly have been made only at the place where the appellant resides. The learned Magistrate, therefore, had no jurisdiction to issue the summons." The said principle has been reiterated in All Cargo Movers (I) Pvt. Ltd. v. Dhanesh Badarmal Jain and Anr. [2007 (12) SCALE 391], stating : facie cannot notice "For the said purpose, allegations in the the necessary complaint petition must disclose ingredients therefor. Where a civil suit is pending and the complaint petition has been filed one year after filing of the civil suit, we may for the purpose of finding out as to whether the said allegations are prima the correspondences the parties and other admitted exchanged by documents. It is one thing to say that the Court at this juncture would not consider the defence of the accused but it is another thing to say that for exercising the inherent jurisdiction of this Court, it is impermissible also to look to the admitted documents. Criminal proceedings should not be encouraged, when it is found to be mala fide or otherwise an abuse of the process of the Court. Superior Courts while exercising this power should also strive to serve the ends of justice." 10 (See also Sharon Michael and ors. vs. State of Tamil Nadu and Anr. [2009 (1) SCALE 627]”
Legal Reasoning
stamped instruments.—Where one person signs and delivers to another a paper stamped in accordance with the law relating to negotiable instruments then in force in [India], and either wholly blank or having written thereon an incomplete negotiable instrument, he thereby gives prima facie authority 14 to the holder thereof to make or complete, as the case may be, upon it a negotiable instrument, for any amount specified therein and not exceeding the amount covered by the stamp. The person so signing shall be liable upon such instrument, in the capacity in which he signed the same, to any holder in due course for such amount: Provided that no person other than a holder in due course shall recover from the person delivering the instrument anything in excess of the amount intended by him to be paid thereunder.” 14. Even considering that the cheque was filled up in different handwriting, more particularly by P.W.2, as admitted, will not change the status of the cheque to be an instalment. In a case P.K. Manmadhan Kartha v. Sanjeev Raj & Anr. reported in J.T 2002(6) SC 31 has held in para-3 and 4. ―3.The complainant is the appellant. The gravamen of the complaint filed under section 138 of the Negotiable Instruments Act, 1881 relates to dishonouring of the cheque – exhibit P-1 said to have been issued by respondent no.1 in favour of the appellant. After trial the learned judicial first class magistrate-II. Thrissur, found respondent no.1 guilty of the offence and sentenced him to undergo rigorous imprisonment for a period of three months and to pay a fine of Rs.90,000/- in default of payment of fine he has to undergo simple imprisonment for three months. The order further says that if the fine amount is realized, the entire amount will be given to PW 1 by way of compensation under section 357 Cr.P.C. The appellate court confirmed his conviction but reduced the sentence of imprisonment to the rising of the court. However, in the revision filed by him in the High Court, taking note of the facts that there is no evidence to show that the cheque has been issued prior to the closure of the account and that no contention was raised that the cheque was issued after closure of the account and also noticing that in exhibit P-1- cheque- there is difference in hand- writing and in ink, the High Court set aside the order of conviction passed by the appellate court confirming the conviction of respondent no.1 by the trial court. 15 4. Having perused the order of the High Court under challenge we are of the view that the above factors do not rebut the statutory presumptions under sections 139 and 118 of the said Act so as to revise the order, set aside the conviction and sentence. In this view of the matter we are unable to sustain the order under challenge. It is accordingly set aside and the criminal revision petition no.1071 of 1999 is restored to the file of the High Court to be disposed of in accordance with law after giving an opportunity of being heard to both the parties.‖ 15. In the aforesaid backdrop allegation and dishonour of cheque is found aptly fledged keeping it away from the flavour of civil dispute which no way has got adverse impact so for present stage is concerned. 16. The learned lawyer for the petitioner puts much stress on an order dated 19.09.2009 passed by this Court in Cr.Misc.No.48092 of 2007. The aforesaid Cr. Misc. was filed against order of cognizance while the present one happens to be at the Stage of charge. Both too have got two different made of consideration, appreciation and application. At the present stage, the evidence so led during trial has to be taken into consideration with regard to nature of offence whatever coming out therefrom. So far plea of petitioner is concerned, it is a matter of trial. For the present there happens to be evidence on record that the cheque for a sum of Rs.62,60,000/-, was issued against the loan so borrowed by the petitioner which bounced on its presentation and any other exposure on this score at the end of 16 petitioner is permissible only under Section 246 of the Cr.P.C. Therefore, in the facts and circumstances of the case, the decision so referred is not found to be applicable. The another order dated 05.03.2009 passed in Cr.Misc.No.35648 of 2007 with Cr.Misc.No.35651 of 2001 again happens to be against the order of cognizance and so also is found to be not applicable. 17. Lastly, it has been contended that petitioner has repaid major portion of the amount during pendency of the proceeding. As such, the proceeding under Section 138 of the Negotiable Instrument Act should be scraped. 18. Aforesaid issue has been taken into consideration in a case Rajneesh Aggarwal v. Amit J. Bhalla reported in 2001 (1) Cr.L.J 708. ―7. So far as the question of deposit of the money during the pendency of these appeals is concerned, we may state that in course of hearing the parties wanted to settle the matter in Court and it is in that connection, to prove the bona fide, the respondent deposited the amount covered under all the three cheques in the Court, but the complainant's counsel insisted that if there is going to be a settlement, then all the pending cases between the parties should be settled, which was, however not agreed to by the respondent and, therefore, the matter could not be settled. So far as the criminal complaint is concerned, once the offence is committed, any payment made subsequent thereto will not absolve the accused of the liability of criminal offence, though in the matter of awarding of sentence, it may have some effect on the Court trying the offence. But by no stretch of imagination, a criminal proceeding could be quashed 17 on account of deposit of money in the Court or that an order of quashing of criminal proceeding, which is otherwise unsustainable in law, could be sustained because of the deposit of money in this Court. In this view of the matter, the so-called deposit of money by the respondent in this Court is of no consequence.‖ 19. Thus after holistic consideration of the matter as discussed above, the proceeding before the learned lower court is found to be alive to the extent of Section 138 of the Negotiable Instrument Act and accordingly permitted so. So far Section 420 of the IPC is concerned, apparently is not found supported with the materials available on the record and on account thereof, the order impugned is set aside to that extent. 20. With the aforesaid modification instant revision petition is dismissed. (Aditya Kumar Trivedi, J) B.Kr./-
Arguments
9. As such, the learned counsel for the petitioner is found justified to plead that no ingredients of Section 415 of the IPC is coming out from the complaint petition as well from the deposition of the witnesses hence Section 420 IPC is not at all attracted. 10. So far 138 of the Negotiable Instrument Act is concerned, it is apparent that cheque was issued by the petitioner/accused. On account of lengthy cross-examination made before charge a plea has been raised on the basis of an admission by P.W.2 in para-3 of his cross-examination that cheque was filled up by him. First of all in terms of Section 244 read with Section 246(4)(5) no such scope is found packthread. 11. Secondly, whether the cheque in present event will justify application of Section 138 of the Negotiable Instrument Act. The aforesaid issue has been adjudicated upon by the Hon’ble Apex Court in a case I.C.D.S. Ltd. V. Beena Shabeer reported in 2002 (4) Cr.L.J. page 3935 wherein cheque was issued which was suggested to be in lieu of surety and it has been explained in following manner. 10. The language, however, has been rather specific as regards the intent of the legislature. The commencement of the Section stands with the words "Where any cheque". The above noted three words are of extreme significance, in particular, by reason of the user of the word "any" the first three words 11 suggest that in fact for whatever reason if a cheque is drawn on an account maintained by him with a banker in favour of another person for the discharge of any of debt or other liability, the highlighed words if read with the first three words at the commencement of Section 138, leave no manner of doubt that for whatever reason it may be, the liability under this provision cannot be avoided in the event the same stands returned by the banker unpaid. The legislature has been careful enough to record not only discharge in whole or in part of any debt but the same includes other liability as well. This aspect of the matter has not been appreciated by the High Court, neither been dealt with or even referred to in the impugned judgment. 11. The issue as regards the co-extensive liability of the guarantor and the principal debtor, in our view, is totally out of the purview of Section 138 of the Act, neither the same calls for any discussion therein. The language of the Statute depicts the intent of the law-makers to the effect that wherever there is a default on the part of one in favour of another and in the event a cheque is issued in discharge of any debt or other liability there cannot be any restriction or embagro in the matter of application of the provisions of Section 138 of the Act : 'Any cheque' and 'other liability' are the two key expressions which stands as clarifying the legislative intent so as to bring the factual context within the ambit of the provisions of the Statute. Any contra interpretation would defeat the intent of the legisalture. The High Court, it seems, got carried away by the issue of guarantee and guarantor's liability and thus has overlooked the true intent and purport of Section 138 of the Act. The judgments recorded in the order of the High Court do not have any relevance in the contextual facts and the same thus does not lend any assistance to the contentions raised by the respondents. 12. Apart from this, there happens to be two relevant 12 provisions available under Negotiable Instrument Act. The first happens to be Section 118(a) whereunder there happens to be presumption as to negotiable instrument and secondly Section 139 having presumption in favour of holder of cheque unless rebutted will acknowledge issuing/receiving the cheque of the nature referred to in Section 138 for the discharge, in whole or in part of, any debt or liability. That means to say both Section 118(a) as well as Section 139 which though lean in favour of holder of the cheque/instrument are found to subject to rebuttal and that could be only discharged during course of trial. The same could be found in a case of K.N.Beena Vrs. Muniyappan & Anr. reported in 2001 (4) Cr.L.J. page 4745. 6. In our view the impugned Judgment cannot be sustained at all. The Judgment erroneously proceeds on the basis that the burden of proving consideration for a dishonoured cheque is on the complainant. It appears that the learned Judge had lost sight of Sections 118 and 139 of the Negotiable Instruments Act. Under Section 118, unless the contrary was proved, it is to be presumed that the Negotiable Instrument (including a cheque) had been made or drawn for consideration. Under Section 139 the Court has to presume, unless the contrary was proved, that the holder of the cheque received the cheque for discharge, in whole or in part of a debt or liability. Thus in complaints under Section 138, the Court has to presume that the cheque had been issued for a debt or liability. This presumption is rebuttable. However, the burden of proving that a cheque had not been issued for a debt or liability is on the accused. in the case of Hiten P. Dalal v. This Court Bratindranath Banerjee reported in (2001) 6 SCC 16 has also taken an identical view. 7. In this case admittedly the 1st Respondent 13 has led no evidence except some formal evidence. The High Court appears to have proceeded on the basis that the denials/ averments in his reply dated 21st May, 1993 were sufficient to shift the burden of proof onto the Appellant/Complainant to prove that the cheque was issued for a debt or liability. This is an entirely erroneous approach. The 1st respondent had to prove in the trial, by leading cogent evidence, that there was no debt or liability. The 1st Respondent not having led any evidence could not be said to have discharged the burden cast on him. The 1st respondent not having discharged the burden of proving that the cheque was not issued for a debt or liability, the conviction as awarded by the Magistrate was correct. The High Court that conviction.12. Even considering the plea of the petitioner that it was a blank cheque which was handed over to the complainant by the accused having it would not permitted the his signature over complainant to use it as negotiable instrument. First of all, Section 6 of the Negotiable Instrument Act is taken into consideration whereunder cheque has been defined. erroneously set aside 13. From plain reading of the Section, it is apparent that no condition is found imposed to the effect that unless blank portion is filled up by the drawer himself, it will not be treated as a cheque. Moreover, at the present juncture Section 20 of the Negotiable Instrument Act also to be taken into consideration which identify and acknowledge the propriety of instrument even being blank. For better appreciation, the same is quoted below:- 20: Section ―Inchoate