THE HONOURABLE MR v. S.Balchand

IN THE HIGH COURT OF JUDICATURE AT MADRASDATE : 09.07.2007CORAM:THE HONOURABLE MR.JUSTICE A.C.ARUMUGAPERUMAL ADITYANCrl.R.C.No.510 of 2004P.J.Nagulan.. Petitioner/Accusedvs.S.Balchand .. Respondent/ComplainantPrayer:- This revision has been preferred against the judgment dated01.12.2003 in C.A.No.55 of 2003 passed by the Sessions Judge,Nilgiris at Uthagamandalam, modifying the judgment made in C.C.No.74of 2003 on the file of the Judicial Magistrate, Uthagamandalam,dated 13.07.2003.For Petitioners :Mr.V.ParthibanFor Respondent :Mr.S.PradeepJUDGMENTThis revision has been preferred against the judgment inC.A.No.55 of 2003 on the file of the Sessions judge, Uthagamandalam,which has arisen out of the judgment in C.C.No.74 of 2003 on thefile of the Judicial Magistrate, Udagamandalam. 2.The complainant/respondent herein has preferred a privatecomplaint under Section 200 of Cr.P.C., against the accused for anoffence under section 138 of the Negotiable Instruments Act,contending that to discharge a subsisting hand loan the accused haddrawn a cheque for Rs.85,000/- in the name of the complainant on15.9.2002 and when the same was presented for realization on28.11.2002 at Central Bank of India, Udagamandalam Branch, the samewas returned with an endorsement "finds insufficient". Immediatelythe complainant had issued notice to the accused informing that thecheque drawn by him under Ex.P.1 was dishonoured by the bank onpresentation. In spite of the receipt of the notice under Ex.P.4the accused has not chosen to send any reply nor made anyarrangement to repay the loan amount. https://hcservices.ecourts.gov.in/hcservices/

3.Afther taking cognizance of the offence, the learned JudicialMagistrate furnished copies under Section 207 of Cr.P.C., and whenthe offence was explained to the accused and questioned the accusedpleaded not guilty. On the side of the complainant, the complainanthas examined himself as P.W.1 and had exhibited Ex.P.1 to Ex.P.5. 4.The complainant as P.W.1, has narrated what he has stated inthe complaint. According to P.W.1, Ex.P.1 is the impugned chequefor Rs.85,000/- drawn by the accused in favour of the complainant on15.9.2002 and when the same was presented on 28.11.2002 in CentralBank for collection the same was returned for the reason "fundsinsufficient". Ex.P.2 is the memo issued by the Central Bank,Uthagamandalam. Ex.P.3 is the memo issued by the Indian Bank,Udagamandalam. Under the original of Ex.P.4 a notice was sent bythe complainant to the accused informing about the dishonour ofEx.P.1-cheque. The said notice was received by the accused underEx.P.5-acknowledgment on 3.12.2002, but the accused has not sent anyreply.5.When incriminating circumstances were put to the accusedunder Section 313 of Cr.P.C., the accused would deny his complicitywith the crime. But he has examined himself as D.W.1 and exhibitedEx.D.1 to Ex.D.3. After going through the evidence both oral anddocumentary, the learned trail Judge has come to the conclusion thatthe offence under Section 138 of the Negotiable Instruments Act hasbeen proved beyond any reasonable doubt against the accused andaccordingly convicted and sentenced the accused under Section 138 ofthe Negotiable Instruments Act to undergo RI for one year and alsodirected him to pay a compensation of Rs.85,000/- to thecomplainant. Aggrieved by the findings of the learned trial Judge,the accused preferred an appeal before the Sessions Judge, Nilgirisat Uthagamandalam, in C.A.No.55 of 2003, who after giving duedeliberations to the submissions made by counsel on both sides andafter going through the evidence on records, modified the sentencealone to that of two months RI instead of one year RI and confirmedthe fine imposed by the trial Court, which necessitated the accusedto prefer this revision before this Court.6.It is reported by both the learned counsel on either sidethat the settlement talk could not be fructified. 7.Now the point for determination in this revision is whetherthe conviction and sentence imposed on the accused under Section 138of the Negotiable Instruments Act by the learned first appellatejudge is sustainable for the reasons stated in the memorandum ofrevision? https://hcservices.ecourts.gov.in/hcservices/

8.The Point:-8(a) The learned counsel appearing for the revisionpetitioner wound contend that the accused had borrowed a hand loanof Rs.40,000/- in the year 1996 from the complainant and that he hadalready discharged the said loan under Ex.D.1, entries made by thecomplainant, and that Ex.P.1-cheque was handed over by the accusedin the year 1996 along with other documents as a security for theloan of Rs.40,000/- borrowed by him from the complainant. Butunfortunately the accused has not sent any reply notice taking sucha defence in it. A perusal of Ex.P.1, impugned cheque will go toshow that it is dated 15.9.2002. According to the learned counselappearing for the revision petitioner, Ex.P.1-cheque was a blankcheque at the time when he handed over the same to the complainantin the year 1996 and the complainant had forged the same for thepurpose of this case after filling up the amount and the name of thepayee in Ex.P.1. But the accused has not taken any steps to referEx.P.1 to an handwriting expert to show that Ex.P.1 is a forged one.The accused has not denied his signature in Ex.P.1, on the otherhand he would admit that Ex.P.1 contains his signature, but it wasonly a blank cheque he had drawn in the year 1996 and handed overthe same to the complainant. Once the signature in Ex.P.1-cheque isadmitted then the presumption under Section 139 of the NegotiableInstruments Act will follow. Section 139 of the NegotiableInstruments Act runs as follows:_"It shall be presumed, unless the contrary isproved, that the holder of a cheque received thecheque, of the nature referred to in section 138, forthe discharge, in whole or in part, of any debt orother liability."8(b) According to P.W.1 only to discharge a subsistingliability of a hand loan on Rs.85,000/- in the year 2002 the accusedhad drawn Ex.P.1-Cheque in favour of the complainant. A vainattempt was made before the trial Court by producing two receiptswhich will go to show that during the year 1999 the complainant hadasked the accused to meet him in person. In the cross-examinationP.W.1 would fairly concede that the accused had borrowed loan fromthe complainant in the year 1999 also and in discharge of the saidloan of Rs.25,000/- (Rs.5,000/- on 26.7.1999 and Rs.20,000/- on24.8.1999) he has issued receipts which were drawn by him but thosetwo receipts were not exhibited. Such a defence cannot also beraised by the accused without taking such a defence by way of replynotice to the notice issued by the complainant under the original ofEx.P.4, which was acknowledged under Ex.P.5. Under suchcircumstances, the conviction under Section1 38 of the NegotiableInstruments Act passed by the both the Courts below cannot beinterfered with by this Court. https://hcservices.ecourts.gov.in/hcservices/ 8(c) But coming to the sentence part the learned JudicialMagistrate has sentenced the accused to undergo one year RI anddirected the accused to pay a sum of Rs.85,000/- to the complainantunder Section 357(3) of Cr.P.C., which was modified by the firstappellate Court in C.A.No.55 of 2003 on the file of the SessionsJudge, Nilgiris at Uthagamandalam, as two months RI and the accusedwas directed to pay a sum of Rs.85,000/- towards compensation withdefault sentence. In this regard, the ratio decidendi in 2004(2)SCC 235 (Goa Plast (P) Ltd. Vs. Chico Ursula D'Souza) is relevantto be referred to herein. In the above said case, the accused haddrawn a chque in favour of the complainant for a sum of Rs.40,000/-and on presentation before the Bank the same was returned with anendorsement that the accused had instructed the bank to stop thepayment. Both the Courts below concurrently held that the accusedcannot under such circumstance be held liable under Section 138 ofthe Negotiable Instruments Act and accordingly acquitted theaccused, which was challenged before the Honourable Apex Court inthe above appeal. The Honourable Apex Court while disposing of theappeal as observed as follows:-"We have no doubt that the respondent has committedan offence punishable under the provisions of Section 138of the NI Act and is liable to be punished. Thetransaction in question took place between the parties inthe year 1993, therefore, Section 138, as it stood at therelevant time, would be applicable to the present case.Section 138 provides imprisonment for a term which mayextend to one year, or with fine which may extend totwice the amount of the cheque, or with both. Section138 has now been amended and the penalty of imprisonmentfor a term which may extend to one year has beensubstituted by two years as provided by the amending Actof 2002 and the fine which may extend to twice the amountof the cheque. This has been prescribed as thepunishment for the offence under Section 138 of the Act. The object and the ingredients under the provisions,in particular, Sections 138 and 139 of the Act cannot beignored. Proper and smooth functioning of all businesstransactions, particularly, of cheques as instruments,primarily depends upon the integrity and honesty of theparties. In our country, in a large number of commercialtransactions, it was noted that the cheques were issuedeven merely as a device not only to stall but even todefraud the creditors. The sanctity and credibility ofissuance of cheques in commercial transactions was erodedto a large extent. Undoubtedly, dishonour of a cheque bythe bank causes incalculable loss, injury andinconvenience to the payee and the entire credibility of https://hcservices.ecourts.gov.in/hcservices/ the business transactions within and outside the countrysuffers a serious setback. Parliament, in order torestore the credibility of cheques as a trustworthysubstitute for cash payment enacted the aforesaidprovisions. The remedy available in a civil Court is along-drawn matter and an unscrupulous drawer normallytakes various pleas to defeat the genuine claim of thepayee."After observing in the above lines the Honourable ApexCourt has given a month's time to the accused to pay asum of Rs.80,000/- (twice the amount of the cheque) tothe complainant with default sentence. I am of the opinion that the same yardstick can be applied to thepresent facts of the case also. The learned counsel for the revisionpetitioner would contend that the complainant is a money lender andthat the accuses is working as a salesman in the Avin Booth inNilgiris. Under such circumstances, I am of the view that at leasttwo months time is to be given tot he accused for the payment.Point is answered accordingly.9. In fine, the criminal revision is dismissed and the judgmentin C.A.No.55 of 2003 on the file of the Sessions Judge, Nilgiris atUthagamandalam, is set aside and the accused is convicted underSection 138 of the Negotiable Instruments Act and two months timefrom this date is given to the appellant/accused to pay a sum ofRs.1,70,000/- (twice the amount of the cheque) to the complainant indefault the accused shall suffer Simple Imprisonment for six months.ssvSd/Asst.Registrar/true copy/Sub Asst.RegistrarTo,1.The Sessions Judge, Uthagamandalam.2.The District and Sessions Judge, Nilgiris at Uthagamandalam.3.The Judicial Magistrate, Uthagamandalam. https://hcservices.ecourts.gov.in/hcservices/

4.-do-The Chief Judicial Magistrate, Uthagamandalam, Nilgiris.+ 1 cc to Mr. G. Kumud Thabhak, Advocate SR No. 41064VRK(CO)SR/17.7.2007Crl.R.C.No.510 of 2004