M/s. Apple Credit Corporation Limited, Gokul Arcade, I Floor, No.2, Sardar Patel Road, Adayar, Chennai-20 v. K.Subbaravamma

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 15.02.2008CORAM:THE HONOURABLE MR.JUSTICE P.R.SHIVAKUMARCriminal Appeal No.1695 of 2002M/s. Apple Credit Corporation Limited,Gokul Arcade, I Floor,No.2, Sardar Patel Road,Adayar, Chennai-20.Rep by its ExecutiveMr.P.R.Venkatesan(Substituted by)Antony Raj.... Appellant/Complainant VsK.Subbaravamma ... Respondent/Accused Appeal under Section 378 of the Code of Criminal Procedureto set aside the order of the acquittal of the accused passed by thelearned IX Metropolitan Magistrate, Saidapet in C.C.No.3550 of 2001dated 27.08.2002 and convict the accused with maximum imprisonmentand grant compensation under Section 357(3) as prayed for by theappellant/complainant.For Appellant : Mr.S.Venkatesan For Respondent: Mr.V.ChandrakanthanJ U D G M E N TThe complainant before the trial Court has preferred thiscriminal appeal against the judgment of acquittal of the learned IXMetropolitan Magistrate, Saidapet, Chennai, dated 27.08.2002pronounced in C.C.No.3550 of 2001.2. The above said calendar case was taken on file based on aprivate complaint preferred by the appellant herein under Section 200Cr.P.C. alleging commission of an offence punishable under Section 138Negotiable Instruments Act, 1881 (hereinafter referred as the Act) bythe respondent herein/accused. https://hcservices.ecourts.gov.in/hcservices/

3. According to the complainant, the appellant/complainant andthe respondent/accused entered into a hire purchase agreement inrespect of a Car and the respondent/accused, being the hirer under thesaid hire purchase agreement, had issued two cheques bearing dates18.01.2001 and 18.02.2001 each for a sum of Rs.8,867/- towards theinstalments. The said cheques had been drawn on Pinakini GrameenaBank, Head Office, Nellore, Andhra Pradesh. When the said cheques weresent for collection through the bankers of the appellant/complainantnamely, Centurion Bank Limited, Anna Salai, Nandanam, Chennai, thesame were returned with an endorsement "Insufficient Funds" along witha banker's memo dated 26.02.2001. The same was received by theappellant/complainant on 07.03.2001 and on 10.03.2001 theappellant/complainant sent a registered notice calling upon therespondent/accused to make payment towards the dishonoured cheques.The said notice was received by the respondent/accused on 25.03.2001.However, he failed to make payment towards the amount covered by thecheques and hence the appellant/complainant was constrained to filethe above said private complaint for prosecuting and punishing therespondent/accused for the above said offence.4. On being served with the process, the respondent/accusedappeared before the trial Court and pleaded not guilty, when he wasquestioned regarding the allegations made against him constituting thecharge under Section 138 of the Act. In the trial that followed, twowitnesses were examined as PW1 and PW2 and nine documents were markedas Ex.P1 to Ex.P9 on the side of the prosecution (complainant). Onewitness was examined as DW1 and one document was marked as Ex.D1 onthe side of the accused.5. At the conclusion of trial, on an appreciation of evidence,the learned IX Metropolitan Magistrate, held that the cheques were notproved to be issued towards the discharge of any legally recoverabledebt or other liability and hence acquitted the respondent/accused byhis judgment dated 27.08.2002. The correctness and legality of thesaid judgment is put in issue in this criminal appeal.6. This court gave its anxious consideration to the submissionmade by the learned counsel on either side and also perused thematerials available on record.7. The complainant before the trial Court, who failed to secure aconviction for the offence punishable under Section 138 of the Actalleged to have been committed by the respondent herein, has comeforward with this appeal. Admittedly, the dishonoured cheques, namelyEx.P2 and E.P3, had been issued towards payment of the monthly chargesunder the hire purchase agreement between the appellant/complainantand the respondent/accused. The subject matter of the hire purchaseagreement was a Maruthi Car. As per the hire purchase agreement theownership remained with the financier, namely theappellant/complainant and the possession of the vehicle had beenhanded over to the respondent/accused. It is also not in dispute that https://hcservices.ecourts.gov.in/hcservices/ the said vehicle met with an accident on 05.06.1997 and receivedextensive damage. Under such circumstances alone therespondent/accused had not chosen to pay the future instalments. Asthe said vehicle was covered by a comprehensive insurance policy, asevidenced by Ex.D1, a sum of Rs.2,30,000/- was paid by the insurer forthe damage caused to the vehicle. 8. According to the appellant/complainant the respondent/accused,being the hirer received the entire amount from the insurance companyon the basis of a no objection letter given by theappellant/complainant. The said version happened to be the assertionof PW1 in the chief examination and in the first part of his evidenceduring cross-examination. But, at the latter point of his testimonyduring cross-examination, he has admitted the insurance amount waspaid to one Sathyanarayan in whose name the insurance policy had beentaken. It was his further admission that the Manager of Gundur Branchof the appellant/complainant concern gave a letter dated 31.12.1998 tothe New India Assurance Company Limited expressing their no objectionfor making payment of the compensation amount to the saidSathyanarayan. It has also been admitted by PW1 that on 31.12.1988itself a sum of Rs.1,25,000/- was paid by the respondent/accused tothe appellant/complainant. 9. It has also been admitted by PW1 that at the time of enteringinto the hire purchase agreement they had obtained 25 numbers ofunfilled cheques from the respondent/accused. The admission of PW1that a sum of Rs.1,25,000/- was paid by the respondent/accused on31.12.1998 and a letter expressing no objection for making payment ofthe compensation to Sathyanarayan was issued on the said date, willprobablise the defence case of the respondent/accused that the entireamount was settled on 31.12.1998 and that is why theappellant/complainant chose to give a no objection letter to theinsurance company to the effect that the compensation amount as perMotor Vehicle Insurance Policy could be released to Sathyanarayan.10. PW1 has given testimony to the effect that the accident tookplace even prior to the issue of registration certificate for the Car.From Ex.P1 it is also obvious that a sum of Rs.2,30,000/- was paid bythe New India Assurance Company Limited to Sathyanarayan ascompensation for the damage caused to the Car. Whether the said amountwas collected and appropriated by the said Sathyanarayan for himselfor else he got the amount on behalf of the then owner of the vehiclenamely the appellant/complainant is not known. There is no piece ofevidence to show on whose behalf the amount was received by the saidSathyanarayan. It is not in dispute that on the date of accident theappellant/complainant was the owner of the vehicle. Nor was it theevidence of PW1 that the said amount was received by Sathyanarayan onbehalf of the respondent/accused. 11. It is admitted that the dishonoured cheques, marked as Ex.P2and Ex.P3, had been issued towards the payment of the charges underthe hire purchase agreement; that the cheques were obtained in 1997 https://hcservices.ecourts.gov.in/hcservices/ itself; that the subject matter of the hire purchase agreement, namelythe Maruthi Car, met with an accident and got totally damaged in thesaid accident that took place on 05.06.1997; that thereafter, on31.12.1998 a sum of Rs.1,25,000/- was paid by the respondent/accusedand pursuant to the said payment the appellant/complainant issued a noobjection letter for paying the compensation amount under the Motorvehicle insurance policy to Sathyanarayan; that till the date ofaccident the respondent/accused was making payments and that onlythere after he stopped making payments. The same will show that theliability towards payment of charges under the hire purchase agreementhad come to an end by 31.12.1998 itself and that thereafter there wasno legally enforceable debt or liability of the respondent/accusedtowards the appellant/complainant. The evidence adduced through DW1and the admission made by PW1 are enough to hold that on preponderanceof probability, the respondent/accused has made out a case for therebuttal of the presumption drawn under Section 139 of the Act. Assuch the burden to prove that the cheques were issued in discharge ofa debt or other liability rests on the appellant/complainant. Butthere is no positive evidence to prove that the dishonoured chequesmarked as Ex.P2 and Ex.P3 had been issued in discharge of a legallyenforceable debt or other liability. In this case, theappellant/complainant has not come forward to divulge the actualcircumstances under which, the cheques happened to be issued. In factthere is not even a whisper in the complaint regarding the date ofhire purchase agreement, the subject matter of the hire purchaseagreement and the other particulars of the same. However, therespondent/accused elicited everything from the mouth of PW1. When PW1has admitted that twenty five blank cheques had been obtained at thetime of entering into the hire purchase agreement and the dues up tothe date of accident were collected through some of the said chequesand that on payment of Rs.1,25,000/- made on 31.12.1998 theappellant/complainant gave a consent letter expressing no objectionfor issuing the compensation amount under the Motor Vehicle Policy tothe erstwhile owner Sathyanarayan, the appellant/complainant shall beduty bound to explain under what circumstances the dishonoured chequesEx.P2 and Ex.P3 happened to be issued two years after the saidsettlement. There is nothing in evidence to show the circumstancesunder which the cheques were issued. On the other hand, there is aclear admission made by PW1 that as many as twenty five cheques hadbeen issued in 1997 itself. That itself will be enough to come to theconclusion that it was the appellant/complainant who was misusing thecheques obtained at the time of entering into the agreement with therespondent/accused. 12. There is every reason to accept the defence plea of therespondent/accused that the amount due to the appellant/complainantunder the hire purchase agreement had been settled and there was nolegally enforceable debt or other liability as on the dates of Ex.P2and Ex.P3 cheques. As pointed out supra, the respondent/accused hasadduced sufficient evidence to make his defence theory probable andthereby he has rebutted the presumption under Section 139 of the Act.As such, the burden shifts on the appellant/complainant to prove that https://hcservices.ecourts.gov.in/hcservices/ there existed a legally recoverable debt or enforceable liability ason the dates of the cheques concerned. The evidence adduced on behalfof the appellant/complainant is not enough to substantiate the chargeunder Section 138 of the Act against the accused beyond reasonabledoubt. Under such circumstances, this Court finds no defect orinfirmity in the judgment of the trial Court holding that therespondent/accused not guilty of the said offence and acquitting himof the said offence. After meticulously weighing the evidence adducedon either side and applying correct principles of law regardingpresumption, rebuttal of such presumption and burden of proof, thelearned IX Metropolitan Magistrate, Saidapet, Chennai has come to acorrect conclusion and rightly acquitted the accused holding him notguilty of the offence which he stood charged. There is no ground,whatsoever, to interfere with the well considered judgment of thelearned IX Metropolitan Magistrate, Saidapet, Chennai. There is nomerit in the appeal and the same deserves to be dismissed. 13. Accordingly, the criminal appeal is dismissed.Sd/Asst.Registrar/true copy/Sub Asst.RegistrarjikrTo:1. The IX Metropolitan Magistrate,Saidapet, Chennai.2. -do-thro' Chief Metropoliran Magistrate,Saidapet, Chennai.1 cc To Mr.S.Venkatesan, Advocate, SR.7243.1 cc To Mr.V.Chandrakanthan, Advocate, SR.7968. Crl.A.No.1695/2002RL(CO)RVL 20.02.2008