THE HON'BLE SRI JUSTICE E.V.VENUGOPAL
CRIMINAL REVISION CASE NO.462 OF 2020
ORDER :
This Criminal Revision Case is filed by the petitioners/accused Nos.1 and 2 under Sections 397 and 401 of Criminal Procedure Code (for short 'Cr.P.C.') aggrieved by the judgment dated 27.02.2020 in Criminal Appeal No.1413 of 2017 on the file of the learned Metropolitan Sessions Judge, Hyderabad wherein the findings dated 24.11.2017 of the learned XXIV Special Magistrate, Hyderabad vide judgment in CC No.333 of 2016 sentencing the 2nd petitioner to undergo simple imprisonment for a period of one year and 1st petitioner to pay a fine of Rs.5,000/- and also to pay the cheque amount of Rs.35,00,000/- as compensation to the 2nd respondent and in default of payment of said fine amount and compensation amount, the 2nd petitioner to suffer simple imprisonment for one month, was confirmed.
2. Heard Sri Mummaneni Srinivasa Rao, learned counsel for the petitioners, Sri Vizarath Ali, learned Assistant Public Prosecutor, representing learned Public Prosecutor for the State/1st respondent and Sri E.Poornachander Rao, learned counsel for the 2nd respondent.
3. CC No.333 of 2016, on the file of the trial Court was filed by the 2nd respondent under Section 200 of Cr.P.C. for the offence punishable under Section 138 of Negotiable Instruments Act, 1881 Page 2 of 6 against the petitioners herein for dishonour of Ex.P2/cheque bearing No.000049 dated 01.12.2015 drawn on Andhra Bank, HMT LE Branch for Rs.35,00,000/- issued in his favour towards discharge of legally enforceable debt i.e. payment of balance sale consideration in respect of a property purchased by the petitioners from the 2nd respondent. Ex.P2 cheque was issued in the place of Ex.P10, which is also a cheque issued initially for the same purpose and dishonoured for insufficiency of funds. Upon presentation, the said cheque was returned unpaid under Ex.P3/cheque return memo dated 02.12.2015 for the reason "insufficient funds". Accordingly, after complying with all the legal formalities, the 2nd respondent got registered the present case. The petitioners contended before the trial Court that the subject cheque was issued in the form of blank one towards security and later the 2nd respondent did not return the same and filed the CC No.333 of 2016. The trial Court, upon considering the evidence on both sides in the form of PW1, Exs.P1 to P9 and Ex.D1, found the petitioners guilty, convicted and sentenced them as stated supra. The said findings were confirmed by the learned appellate Court vide Criminal Appeal No.1413 of 2017.
4. Aggrieved by the findings of both the Courts below, the petitioners filed the present criminal revision case mainly contending that both the Courts below failed to consider the fact that ingredients of the case on hand do not attract Section 138 of NI Act, as on the date of Page 3 of 6 issuance of Ex.P2 cheque, the agreement of sale/Ex.P1 was cancelled vide cancellation deed/Ex.P12 and hence, issuance of Ex.P2 towards discharge of legally enforceable debt does not arise, the Judge of the learned trial Court, who is a Special Magistrate, has no power or authority to convict the petitioners under Section 138 of NI Act since the trial, enquiry and order must be passed by the officer not below the rank of Judicial First Class Magistrate. Thus stating, he requested to allow the present criminal revision case. On the other hand, learned counsel for the 1st respondent and learned Assistant Public Prosecutor opposed the present matter vehemently contending that findings of both the Courts below are well considered and reasoned ones and there is no necessity for interference with the same.
5. Issuance of Ex.P2 cheque, signature of 2nd petitioner on it and its return are not disputed by the petitioners. The vehement contention of the petitioners is that Ex.P2 cheque was not issued towards discharge of legally enforceable debt. On the other hand, the 2nd respondent has drawn a presumption under Sections 118 and 139 of NI Act that Ex.P2 was issued towards discharge of a legally enforceable debt. Therefore, heavy burden lies on the petitioners to rebut the same by explaining the circumstances under which, Ex.P2 was issued. It is the contention of the petitioners that Ex.P2 cheque was issued in the form of blank one towards security while entering into Ex.P1/agreement of sale but the same was not returned by the 2nd Page 4 of 6 respondent after its purpose was fulfilled. However, it is not explained by the petitioners as to why they kept quiet since presentation of Ex.P2 and its subsequent dishonour and issuance of a legal notice. Though the petitioners disputed receipt of legal notice, it is a fact to be noted that the same was addressed to the correct address of the petitioners and hence, it is deemed to be valid service of notice on the petitioners. There is nothing on record showing the legal recourse taken by the petitioners seeking return of the unreturned documents or for legal notice/Ex.P4 issued by the 2nd respondent. The petitioners did not adduce any evidence before the trial Court in support of their defence. In these circumstances, the contention of the petitioners that Ex.P2 was handed over in the form of blank one cannot be believed.
6. It is the contention of the 2nd respondent that agreement is for sale of all the properties mentioned in schedule along with machinery and other fixtures and that Ex.P8/sale deed is only pertaining to land and building as such, for the remaining part of the schedule, consideration is as in Ex.P1 remains live, hence he is entitled for rest of the amount of Rs.35,00,000/- towards the factory equipment and machinery items. On the other hand, the petitioners contended that payment under Ex.P2 is nothing but execution of an illegal agreement, to avoid the stamp duty, which shall be considered as void under Section 23 of the Contract Act.
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7. Perusal of entire record goes to show that there is inconsistency in the defence of the petitioners and that it has been changed from time to time, which itself gives rise to a suspicion that only to get rid of the conviction and criminal liability for dishonour of the cheques, the petitioners are trying to put forth several contentions without corroborative and sustentative evidence. On the other hand, the 2nd respondent by adducing oral and documentary evidence, could able to establish that initially the petitioners issued Ex.P10 cheque for Rs.35,00,000/- and upon its dishonour, they issued Ex.P2 cheque for the said amount and the said cheque was also dishonoured for the reason of insufficiency of funds in the account of the petitioners. In that view of the matter, both the Courts below have rightly appreciated the evidence available on record and gave reasoned findings finding the petitioner guilty. This Court finds nothing on record warranting its interference with regard to the concurrent findings of both the Courts below.
8. So far as the contention of the learned counsel for the petitioners that Judge of the learned trial Court, who is a Special Magistrate, has no power or authority to convict the petitioners under Section 138 of NI Act since the trial, enquiry and order must be passed by the officer not below the rank of Judicial First Class Magistrate is concerned, the 2nd respondent filed copies of GOMs.No.35 dated 31.03.2011, issued by the then Government of Andhra Pradesh, copy of Page 6 of 6 ROC No.701/E1/2010 dated 19.07.2011 issued by this Court and also the illustrative list of cases assigned to Morning/Evening/Shift/Special Magistrates' Courts and of the above said documents, the illustrative list, referred supra, at serial No.3, clearly shows assignment of cheque bouncing cases under Section 138 of Negotiable Instruments Act, 1881 along with other cases to the Special Magistrates' Courts. The 2nd respondent also filed the copies of subsequent GOs continuing the Special Magistrate Courts from time to time. In that view of the matter, the contention of the petitioners in this regard will not stand for legal scrutiny and hence, the same stands rejected.
9. Having regard to the above facts and circumstances and also the evidence on record, this Court is of the considered view that the concurrent findings of both the Courts below are sustainable and there is no apparent error on the face of record and hence, there is no need or necessity warranting interference of this Court. Accordingly, this Court is inclined to dismiss the criminal revision case.
10. In the result, this Criminal Revision Case is dismissed. The miscellaneous applications, if any pending, shall also stand closed.
______________________ E.V.VENUGOPAL, J Dated : 09-11-2023 abb