The High Court · 2025

THE HONOURABLE SRI JUSTICE E. V. VE}NUGOPAL - CRIMINAL REVISION CASE No. 117L of 2024 ',' ORDER: The present Criminal Revision Case is filed aggrieved by the judgment dated 17.08.2023 in Crl.A.No.683 of 2016 passed by the VI Additional Metropolitarr Ser;sions Judge, Rarga Reddy District at Kukatpally (for short, 'the appellate Court'), confirming the judgment dated 1'Z.t)8.20 16 in C.C.No.O7 of 2016 passed by the IV Special Magistrate Court, Kukutpally at Miyapur (for short, 'the triril Court').

2. Heard learned counsel for tlLe revision petitioner/ accused, and Sri E. Ganesh, learnecl Assistant Public Prosecutor appearing for the respondent No.1 - State. None afpears for respondent No.2/complainant. Perused the record.

3. Brief facts of the case a_re that the petitir>ner/ accused and respondent No.2/complainant have well acquaintance with each other and out of the said acquaintance, in the first week of December, 2013, the petitioner approached EYV.J CRLRC I I71 2024 respondent No.2 requesting him to give a hand loan of Rs.1,5O,OOO/- to meet his family needs. The respondent No.2 agreed to give the loan and he withdrew an amount of Rs.1,0O,OO0/- from his bank account through the cheque bearing No.i71988 and along with the cash of Rs.S0,OOO/- available with him he gave the amount of Rs.1,5O,O0O/- to the petitioner on 17.12.2013 in the presence of one Mr.A. Suresh and the petitioner promised to repay the amount within a short period. Thereafter, respondent No.2 approached the petitioner several times requesting him to repay the loan amount and finally petitioner/ accused issued the cheque bearing No.178983, dated 17.O8.2OI5, for Rs.1,50,OO0/- drawn on Oriental Bank of Commerce, Chandanagar Branch, and on presentation of the cheque before his banker Axis Bank Limited., Chandanagar Branch, by respondent No.2 the sarne was returned unpaid on

19.08.2015 for the reason "Funds Insufficient" though the cheque return memo dated 19.08.2015. Though, the same was informed to the petitioner through phone, he failed to keep up his promise. On 03.09.2015, respondent No.2 got issued a legal notice to the petitioner and though the a , LI'I',J cRt_RC It7t 2024 petitioner received the same on 04.09.2O15, he failed to give any reply. As there were some typographical rrListakes in the said legal notice, respondent No.2 got issued eL corrigendum notice on 24.O9.2015 by correcting the typographical mistakes. As the petitioner borrowed money from respondent No.2 and issued a cheque for discharge of tht: said liability and as the cheque was dis-honred, the petitiorrer is liable to be punished under Section 138 of the Negotiable Instrument Act

4. During the course of trial, on behalf of the prosecution, PW. 1 was examined and got marked Exs.Pl t,r lIx.PlO. In defence, DWl and DW2 were examined and got marked Exs.D 1 to D3. After appreciation of evidence, both the oral and documentary, available on record, the tri a1 Court uide judgment dated 17.08.2016 in C.C.No.O7 of 20ltt convicted and sentenced the petitioner/ accused to undergo simple imprisonment for a period of six months ard directed him to pay an amount of Rs.1,75,000/- under Se:ction 357(3) Cr.P.C., towards compensation to respondent Irlo.2 within a period of one month and, in default of payment of :1 EryJ CRLRC IITI 2024 } compensation, to undergo simple imprisonment for a period of six months for the offence punishable under Section 138 of the Negotiable Instruments Act. Aggrieved thereby, the petitioner/accused preferred Crl.A.No.683 of 2016 on the fi1e of learned VI Additional Metropolitan Sessions Judge, Ranga Reddy District at Kukatpally.

5. After hearing learned counsel for the respective parties and on re-appreciation of evidence availabie on record, the appellate Court, uide judgment dated 17.08.2023, dismissed ttre appeal confirming the judgment passed by the trial Court. As the appeliarrt failed to appear on 17.08.2023, the appellate Court directed the trial Court to issue NBW against the petitioner/ accused and secure his presence to serve out the sentence. Assailing the same, the petitioner/ accused has filed the present Revision.

6. l,earned counsel for the petitioner/ accused contended that the trial Court as well as the appellate Court failed to appreciate the evidence available on record. in proper perspective and passed the respective judgments. Therefore, he seeks to set aside the impugned judgment. EY'V,J cRt.RC I t7l 2024

7. On the other hand, the learned Assristant Public Prosecutor opposed the same and contended that both the Courts, upon appreciating the ora-l and documentary evidence available on record in right perspecti.re, passed the respective judgments and interference of this Oourt with the weli considered judgments of both the Cou -ts below are unwarranted. Therefore, he seeks to dismiss th,: Rer ision.

8. A perusal of the record discloses that E:<.['2 -- cheque was issued for the discharge of any legally enfcrr;eable debt. There is no explanation as to why the petitr oner has not given any reply to the legal notice issued by the complainant The complainant, through his evidence supported by the evidence of PW2 and Ex.P1 to PIO and the adnrissions made by the accused ard DW2, succeeded in proving that the accused issued Ex.P2 - cheque for the discharge of a legally enforceable debt and the same was return€ d un paid on presentation due to 'funds insufficient'.

9. In the case on hand, both the Courts held that the petitioner/ accused was guilty for the offence ptrnishable under Section 138 of NI Act, which finding, in rny considered EW,J CRLRC t17t 2024 (-.) view, does not call for any interference in exercise of revisional jurisdiction under Section 397 Cr.P.C. Therefore, there are no grounds much less valid grounds to interfere with the well considered judgments passed by both the Courts below.

10. Having regard to the submissions made by learned counsel for the respective parties and a,lso relying on the decision in Dannodar S.Pra.bhu os Saged Babalal Hr whereby and where-under the Hon'ble Supreme Court, while observing that it is quite obvious that with respect to the offence of dishonour of cheques, it is the compensatory aspect of the remedy which should be given priority over the punitive aspect, held as follows:

3. However, there are some larger issues which can be appropriately addressed in the context of the present case. It may be reca-lled that Chapter XVII comprising sections 138 to 142 was inserted into t1.e Act by the Banking, Public Financial Institutions ald Negotiable Instruments Laws (Amendment) Act, 1988 (66 of 1988). The object of bringing Section 138 into the statute was to inculcate faith in the efficary of banking operations a-nd credibility in transacting business on negotiable instruments- It was to enhance the acceptability of cheques in settlement of liabilities by rnaking the drawer liable for penalties in case of bouncing of cheques due to insuffrcient a-rrangements made by tl.e drawer, with adequate safeguards to prevent harassment of honest drawers. If ttre cheque is dishonoured for insufficiency of funds in the drawer's account or if it ' lzotoy s scc eot I. . t I I i I I I r I I I - -l;-qf1-i4:: r -1'Ft*" " 'i EryJ CRLRC 1I71 2024 exceeds the arnount arra-nged to be paid from t:rat account, the drawer is to be punished with imprisonmer: t {br a term which may extend to two years, or with fine which may extend to twice the amount of the cheque, or rvith both. It may be noted that when the offence was ins,rrted in the statute in 1988, it carried the provision for impr.sonment up to one year, which was revised to two years following the amendment to the Act in 2OO2. It is quite er.iden: that the legislative intent was to provide a strong criminirl remedy in order to deter the worryingly high incidence of rlishonour of cheques. While the possibility of imprisonmen - up to two years provides a remedy of a punitive nature, the provision for imposing a'frne which may extent to twice t1le amount of the cheque' serves a compensatory purpose. What must be remembered is that tJle dishonour of a cheque can be best described as a regulatory offence that has been created to serve the public interest in ensuring the reliabili[' of these instruments. The impact of this offence is usualll' conhned to the private parties involved in commercial transactions.

11. The Hon'ble Supreme Court in M/s. Gi.mpex (P) Ltd. Vd. Manoj Goeal2 held as follows: Allowing prosecution under both sets of complaints would be contrary to the purpose of tfre enactmr:nt. As noted above, it is the compensatory aspect of the remed l that should be given priority as opposed to the punitil,e aspect. The complainant in such cases is primarily concerrrei uitJ the recovery of money, the conviction of the accusecl senes little purpose. In fact, the threat of jail acts as a sti:k to ensure paJment of money. This Court in R. Vijaya.n v. Baby3 emphasised how punishment of the offender is ol a secondarJr concern for the complainant in the following terms: "17. TL e appa,rent intention is to ensure that not only the offender is punished, but also ensure that the c,tmplainant invariably receives the amount of the cheque by way of compensation Under Section 357(1)tb) of the Co,le. Though a compiaint Under Section 138 of the Act is irr regard to criminal liability for the offence of dishonouring the cheque and not for the recovery of the cheque amorrnt (tvhich strictly speaking, has to be enforced by a cir i1 suit), in practice once the criminal compiaint is lod,led Llnder Section 138 of the Act, a civil suit is seldom filec. to recover ' lzozzy t '(zorz) t I SCC 70s scc 260 -l I I I I I I I I i EW,J CRLRC 1t7t 2024 () the amount of the cheque. This is because of the provision enabling the court to levy a fine linked to the cheque amount and the usual direction in such cases is for paJ,.rnent as compensation, the cheque amount, as loss incurred by the complainant on account of dishonour of cheque. Under Section 357(1)(b) of the Code and the provision for compounding the offences Under Section 138 of the Act most of the cases (except those where liability is denied) get compounded at one stage or the other by paJrment of the cheque amount with or without interest. Even where the offence is not compounded, t1.e courts tend to direct payment of compensation equal to the cheque amount (or even something more towards interest) by levying a hne commensurate with the cheque amount. A stage has reached when most of the complainants, in particular the financing institutions (particularly private hnanciers) view the proceedings under Section 138 of the Act, as a proceeding for the recovery of the cheque arnount, the punishment of tl.e drawer of the cheque for the offence of dishonour, becoming secondary." L2. In the .instant case, the petitioner 1S aged about 30 ye€[s, as of now, arrd the complaint pertains to the year

2016. Therefore, in the light of the judicial precedent laid down by the Hon'ble Supreme Court in the above case, this Court is of the considered view that the sentence imposed by the trial Court is already undergone by the revision petitioner.

13. In view of the above, this criminal revision case is dismissed. However, the sentence imposed by the trial Court, as conflrmed by the appellate Court, is restricted to the period already undergone by the petitioner. EI'I"J CRI-RC I I71 2024 L4. Except the above modification, in all otht:r asllects, the judgment passed by the trial Court, as con:-rrmed by the appellate Court, shall remain unaltered. Miscellaneous Petitions, pending if ant, shall stand closed. /ITRUE COPY" S rr,-I.LAKSHMI BABU lieFuw REGISTRAR i ,l SECTION OFFICER to'',, 2 ,n" Vl Additional Metropolitan Sessions Judge' Ranga'eddy District AT KukatPallY One CC to Sri. Ravi Kumar Veluri' Advocate [OPUC] one CC to the Public Prosecutor, High Court for the State of Telangana' Hyderabad [OUT]

4. Two CD CoPies PSt(gh HIGH COURT DATED:2210112025 I .:. , (). r (. r,ri.l.,.] ..t. . ..' O2 :EF 2E \-. "' ORDER CRLRC.No.1171 o12024 DISMISSED THE CRIMINAL REVISION CASE AS MODIFIED s h