Raj Kumar Goel vs State Of U.P. And Another
2017 Latest Caselaw 7221 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

AFR
 
Reserved
 
Court No. - 51
 

 
Case :- CRIMINAL REVISION No. - 918 of 2007
 

 
Revisionist :- Raj Kumar Goel
 
Opposite Party :- State Of U.P. And Another
 
Counsel for Revisionist :- Harish Chandra,Rajeev Gupta
 
Counsel for Opposite Party :- Government Advocate,Vivek Prakash Misra
 

 
Hon'ble J.J. Munir,J.

The revisionist Raj Kumar Goel issued a cheque that bounced with a remark "insufficient fund"; the second respondent Smt. Chandra Prabha is the payee of the cheque aforesaid.

This revision has been filed by Raj Kumar Goel from a judgment and order dated 23.03.2007 of Mr. Lukmanul Haq, the then Additional Sessions Judge, Court No. 10, Ghaziabad in Criminal Appeal No. 5/2007 dismissing the said appeal and affirming a judgment and order of Ms. Sapna Mishra, the then Special Judicial Magistrate (C.B.I.), Ghaziabad dated 29.01.2007 passed in Criminal Case No. 730 of 2006, under Section 138 of Negotiable Instrument Act (for short the 'Act') convicting the revisionist of the charge under Section 138 of Act and sentencing him to suffer three months rigorous imprisonment and imposing a fine of Rs. 2000/-, and in default of payment of fine to undergo a further term of 15 days simple imprisonment. The revisionist has also been ordered to pay a compensation in the sum of Rs. 30,000/- to the second respondent-complainant invoking the provisions of Section 357 Cr.P.C.

The case of the complainant-respondent no.2 that led to the revisionist's conviction, in short, is that the complainant is a kind hearted person who is predisposed to reach out to anyone in need of help. The revisionist knew the complainant through some relatives of hers. The revisionist requested the complainant to loan her a sum of Rs. 2 lacs. It is urged that revisionist represented to the complainant-opposite party that his business had run into trouble and that he would refund money loaned to him piecemeal. In consideration of the loan by the complainant, the revisionist issued a cheque worth Rs. 20,000/- towards the first installment of refund bearing cheque no. 555852 dated 25.08.2005 drawn on the ICICI Bank, Patel Nagar, Ghaziabad. It is the complainant-opposite party's case that she presented the cheque in account through her bank but it was dishonoured through her bank with a remark "insufficient funds" by the revisionist's bank.

The complainant says that distressed at the aforesaid turn of events she caused legal notice dated 29.09.2005 to be served upon the revisionist through her counsel which despite service and expiry of the statutory period remained fruitless. Accordingly, she brought a complaint under Sectgion 138 of the Act which was registered as complaint case no. 730 of 2006 on the file of the Special Judicial Magistrate (C.B.I.), Ghaziabad. The statement of the complainant under Section 200 was accepted on her affidavit and documentary evidence was filed comprising the original bounced cheque, the bank memo reporting dishonour, carbon copy of the legal notice sent to the revisionist and the receipt of dispatch by registered post relative to the legal notice in original. On the basis of the evidence aforesaid the Magistrate summoned the revisionist to stand his trial for an offence punishable under Section 138 of the Act.

At the trial the complainant deposed as PW-1. No other evidence was led on her behalf.

The revisionist was examined under Section 313 Cr.P.C. where he denied having issued the bounced cheque to the complainant-respondent. He further denied service of the statutory notice. The revisionist took a specific stand that he had lost his bag at Lohiya Nagar that had money and his cheque book regarding which he had given information to the police. The revisionist was called upon to enter defence. The revisionist entered defence and deposed in the witness box as DW-1 and by way of documentary evidence brought on record a carbon copy of the written information of the loss of his money and cheque book given to the police duly acknowledged by P.S. Sihani Gate, district Ghaziabad.

I have heard learned counsel for the revisionist Sri Harish Chandra and learned AGA for the State. Even though the case was called on in the revised list, learned counsel for the opposite party no.2 Sri Vivek Kumar Mishra did not appear.

I have gone through the record of the revision carefully with the benefit of a very fair assistance by Sri Harish Chandra and the learned AGA.

Sri Harish Chandra pointed out that the conviction and sentence recorded against the revisionist was manifestly illegal on the short point that the complainant-respondent no.2 had not discharged her evidential burden under Section 138 of Act which requires her to establish by evidence that the bounced cheque was given by the revisionist in discharge of a legally enforceable liability. He submits that unless this initial burden cast upon the complainant is discharged, no presumption under Section 139 of the Act can be drawn requiring the accused-revisionist to establish by evidence aliunde that the bounced cheque was never issued by the revisionist to liquidate an anterior existing debt in favour of the complainant or to some other from whom she has become a holder in due course. Sri Harish Chandra has placed strong reliance on a decision of Andhra Pradesh High Court in re: A Bhoosanrao vs. Purushotthamdas Pantai, 1998 CriLJ 906 (AP), where it has been held in paragraph 2 of the judgment (not the report above mentioned) as under:

"2. Adverting to the contention of the appellant, the counsel for the respondent submitted that it is the specific case of the complainant that the amount was lent by way of a cheque and it is his further case that on the next day he sent post-dated cheque along with a letter. But in the witness box he categorically submitted that he paid the amount from his salaries and he is not maintaining any account and he is not an income-tax assessee. Though he does Real Estate business and earns lakhs of rupees every year, he is not filing income-tax returns. When the very fact of giving amount was denied in the reply notice sent to the legal notice given by him dated 21-3-1991, the appellant did not choose to summon the cheque from the Bank or filed the counter-foil or the said cheque book from which he had given the cheque. Further he has suppressed the reply notice sent by the accused wherein he has categorically disputed the liability on his part. To bring home the guilt of the accused under Section 138 of the Act, the complainant is bound to discharge the initial burden cast upon him that the cheque was given by the accused in discharge of a legally enforceable liability. If the accused failed to produce the receipts in criminal proceedings, the prosecution has to succeed or fail on its own case depending upon the oral and documentary evidence on record. In this case, as the complainant failed to prove satisfactorily that he has sufficient capacity to lend the amount of Rs. 1,25,000/- and more so, by way of cheque and his failure to prove that the amount was actually drawn by the accused, the accused cannot be punished for an offence under Section 138 of the Act."

Learned counsel for the revisionist has invited the attention of this Court to the statement of PW-1 as to her resource through which she garnered funds to advance the alleged loan of Rs. 2 lacs to the revisionist. The statement of the complainant in this regard is to be found in her cross-examination dated 01.11.2006 recorded before the trial court where she has said (in Hindi vernacular) :

" iSls cSad ls fudky fn;s FksA ftues ,d yk[k dh rks desVh Mkyh Fkh eq>s ;kn ugh fd dkSu lh rkjh[k dks fudkys Fks ikl cqd ykdj fn[kk ldrk gWw 50][email protected]& :i;s eSus csVs ls ysdj fn;s Fks 50][email protected]& :i;s eSus cSad ls fudkys Fks eSus vkt rd fdlh vkSj dks m/kkj u fn;kA tc :i;s fn;s Fks esjh cgw csVs lc cSBs gq;s FksA **

Learned counsel for the revisionist submits that statement of the revisionist as to the source of money that she had allegedly utilized to advance a loan of Rs. 2 lacs of which the bounced cheque is alleged to be the first installment of refund is not even remotely established. She has not able to show by any reasonable standard that she had any money to advance. In the submission of the learned counsel for the revisionist the entire story is based on a figment of the complainant's imagination, and, therefore, there never was a legally existing debt or liability established by the complainant-respondent no.2 in liquidation of which the bounced cheque is said to have been issued. The initial burden under Section 138 of the Act thus has not been discharged by the complainant-opposite party so as to raise the statutory presumption of a pre-existing liability in discharge of which the bounced cheque can be presumed to be issued.

I am afraid that the submission of learned counsel for the revisionist cannot be accepted on the parameters of law as to presumption and burden of proof under Section 138 and 139 of the Act, the way it has been viewed on the high authority of their Lordships of the Supreme Court. In this connection the decision of Supreme Court in Hiten P. Dalal vs. Bratindranath Banerjee, 2001 AIR SC 3897 is illuminating, where in paragraphs 20, 21, 22 and 23 of the report it is held:

20. The appellant's submission that the cheques were not drawn for the 'discharge in whole or in part of any debt or other liability' is answered by the third presumption available to the Bank under Section 139 of the Negotiable Instruments Act. This section provides that "it shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability". The effect of these presumptions is to place the evidential burden on the appellant of proving that the cheque was not received by the Bank towards the discharge of any liability.

21. Because both Sections 138 and 139 require that the Court "shall presume" the liability of the drawer of the cheques for the amounts for which the cheques are drawn, as noted in State of Madras vs. A. Vaidyanatha Iyer AIR 1958 SC 61, it is obligatory on the Court to raise this presumption in every case where the factual basis for the raising of the presumption had been established. "It introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused" (ibid). Such a presumption is a presumption of law, as distinguished from a presumption of fact which describes provisions by which the court "may presume" a certain state of affairs. Presumptions are rules of evidence and do not conflict with the presumption of innocence, because by the latter all that is meant is that the prosecution is obliged to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumptions of law or fact unless the accused adduces evidence showing the reasonable possibility of the non-existence of the presumed fact.

22. In other words, provided the facts required to form the basis of a presumption of law exists, no discretion is left with the Court but to draw the statutory conclusion, but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary. A fact is said to be proved when, "after considering the matters before it, the Court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists". Section 3 : Evidence Act. Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the Court in support of the defence that the Court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the 'prudent man'.

23. Judicial statements have differed as to the quantum of rebutting evidence required. In Kundan Lal Rallaram vs Custodian, Evacuee Property, Bombay AIR 1961 SC 1316, this Court held that the presumption of law under Section 118 of Negotiable Instruments Act could be rebutted, in certain circumstances, by a presumption of fact raised under Section 114 of the Evidence Act. The decision must be limited to the facts of that case. The more authoritative view has been laid down in the subsequent decision of the Constitution Bench in Dhanvantrai Balwantrai Desai vs State of Maharashtra AIR 1964 SC 575, where this Court reiterated the principle enunciated in State of Madras vs Vaidyanath Iyer (Supra) and clarified that the distinction between the two kinds of presumption lay not only in the mandate to the Court, but also in the nature of evidence required to rebut the two. In the case of a discretionary presumption if drawn may be rebutted by an explanation which "might reasonably be true and which is consistent with the innocence" of the accused. On the other hand in the case of a mandatory presumption "the burden resting on the accused person in such a case would not be as light as it is where a presumption is raised under S.114 of the Evidence Act and cannot be held to be discharged merely by reason of the fact that the explanation offered by the accused is reasonable and probable. It must further be shown that the explanation is a true one. The words 'unless the contrary is proved' which occur in this provision make it clear that the presumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible. A fact is said to be proved when its existence is directly established or when upon the material before it the Court finds its existence to be so probable that a reasonable man would act on the supposition that it exists. Unless, therefore, the explanation is supported by proof, the presumption created by the provision cannot be said to be rebutted......"

There is other authority regarding the statutory presumption and burden of proof coming from their Lordships of the Supreme Court which is consistent and unwavering. It binds this Court firmly as it does every other Court. The learned Sessions Judge also has taken note of good authority to the same effect by their Lordships in the judgment impugned. Thus on the state of facts and evidence the presumption under Section 138 and 139 of the Act is firmly in place against the revisionist.

What now has to be seen is whether the revisionist has rebutted the presumption under Section 139 of the Act by proof and not merely by a plausible explanation that the bounced cheque in fact had never been issued by him in discharge of an existing liability to the complainant or to someone else from whom the complainant has become a holder in due course. The explanation offered by the revisionist that his bag was stolen with a cheque book containing signed cheques one of which has been misutilized as the bounced cheque, has not been believed by two courts of fact below on the evidence adduced in support of that explanation. Both courts have found on evidence led on behalf of the revisionist that the statutory presumption under Section 139 does not stand rebutted. The learned counsel for the revisionist Sri Harish Chandra despite his very persuasive submissions has not been able to show that the view of evidence by the two courts below as to the explanation and the defence by the revisionist is perverse or manifestly illegal. There is, therefore, no reasons for this Court to disturb that finding recorded by two courts of fact below in exercise of our revisional jurisdiction. Thus, so far as the conviction of the revisionist for the offence punishable under Section 138 of the Act is concerned the same cannot be disturbed and is upheld.

Sri Harish Chandra next submitted that the sentence of imprisonment awarded by the courts below does not accord with the overall circumstances of the case and the parties. It is both disproportionate and one that is against the purpose for which the special remedy to the payee or holder of a bounced cheque has been provided by the legislature through Section 138 of the Act. It is his submission that sending the revisionist to jail would secure no purpose as the object of the respondent no.2 like any other complainant invoking section 138 of the Act is to recover the money claimed to be lost than to see the drawer of the cheque in prison. The learned counsel has relied in support of his submission upon decision of their Lordships of the Supreme Court in Damodar S. Prabhu vs. Syed Baba Lal H, (2010)5 SCC 663, where in paragraph 17 of the report it has been held thus:

"17. In the recently published commentary, the following observations have been made with regard to the offence punishable under Section 138 of the Act [cited from: Arun Mohan, Some thoughts towards law reforms on the topic of Section 138, Negotiable Instruments Act―Tackling an avalanche of cases (New Delhi: Universal law Publishing Co.Pvt. Ltd, 2009) at P. 5]

"........ Unlike that for other forms of crime, the punishment here (insofar as the complainant is concerned) is not a means of seeking retribution, but is more a means to ensure payment of money. The complainant's interest lies primarily in recovering the money rather than seeing the drawer of the cheque in jail. The threat of jail is only a mode to ensure recovery. As against the accused who is willing to undergo a jail term, there is little available as remedy for the holder of the cheque.

If we were to examine the number of complaints filed which were 'compromised' or 'settled' before the final judgment on one side and the cases which proceeded to judgment and conviction on the other, we will find that the bulk was settled and only a miniscule number continued."

He has submitted therefore that in substitution of the sentence of imprisonment the fine imposed may be proportionately enhanced as this Court may find fit to determine. Learned counsel for the revisionist is in further criticism of the impugned judgment and orders passed by the courts below insofar as the same proceed to impose a fine upon the revisionist in the sum of Rs. 2000/- and at the same time awards compensation to the complainant-Respondent No.2 invoking their powers under Section 357 Cr.P.C. Learned counsel submits that in case fine is imposed under Section 138 of the Act no compensation can be awarded invoking the provisions of Section 357 Cr.P.C. To my mind the aforesaid submission is well founded.

The Supreme Court had occasion to consider the aforesaid question whether a fine under Section 138 of the Act and compensation under Section 357 Cr.P.C. could simultaneously be ordered in R. Vijayan vs. Baby and another, 2012 AIR (SC) 528, where it has been opined that the two cannot be ordered together. Paragraphs 7, 8 and 9 of the report in re: R. Vijayan (supra) are relevant :

7. Sub-section (3) of section 357, is categorical that the compensation can be awarded only where fine does not form part of the sentence. Section 357(3) has been the subject-matter of judicial interpretation by this Court in several decisions. In State of Punjab vs. Gurmej Singh [2002 (6) SCC 663], this Court held :

"A reading of sub-section (3) of Section 357 would show that the question of award of compensation would arise where the court imposes a sentence of which fine does not form a part."

This Court also held that section 357(3) will not apply where a sentence of fine has been imposed.

8. In Sivasuriyan vs. Thangavelu [2004 (13) SCC 795], this Court held :

"In view of the submissions made, the only question that arises for consideration is whether the court can direct payment of compensation in exercise of power under sub-section (3) of Section 357 in a case where fine already forms a part of the sentence. Apart from sub-section (3) of Section 357 there is no other provision under the Code whereunder the court can exercise such power:"

After extracting section 357(3) of the Code, the Court proceeded to hold thus:

"On a plain reading of the aforesaid provision, it is crystal clear that the power can be exercised only when the court imposes sentence by which fine does not form a part. In the case in hand, a court having sentenced to imprisonment, as also fine, the power under sub-section (3) of Section 357 could not have been exercised. In that view of the matter, the impugned direction of the High Court directing payment of compensation to the tune of Rs. one lakh by the appellant is set aside."

9. It is evident from Sub-Section (3) of section 357 of the Code, that where the sentence imposed does not include a fine, that is, where the sentence relates to only imprisonment, the court, when passing judgment, can direct the accused to pay, by way of compensation, such amount as may be specified in the order to the person who has suffered any loss or injury by reason of the act for which the accused person has been so sentenced. The reason for this is obvious. Sub-section (1) of section 357 provides that where the court imposes a sentence of fine or a sentence of which fine forms a part, the Court may direct the fine amount to be applied in the payment to any person of compensation for any loss or injury caused by the offence, when compensation is, in the opinion of the court, recoverable by such person in a Civil Court. Thus, if compensation could be paid from out of the fine, there is no need to award separate compensation. Only where the sentence does not include fine but only imprisonment and the court finds that the person who has suffered any loss or injury by reason of the act of the accused person, requires to be compensated, it is permitted to award compensation under compensation under section 357(3).

This Court is of opinion that the courts below having imposed a sentence of fine in the sum of Rs. 2,000/- and at the same time ordered compensation in the sum of Rs. 30,000/- to be paid by the revisionist to the second opposite party in exercise of powers under Section 357 Cr.P.C. committed manifest illegality; the two cannot be ordered together.

Considering the other part of the submission of the learned counsel made earlier that instead of awarding a sentence of imprisonment to the revisionist, the sentence of fine may be appropriately enhanced, this Court finds guidance in the decision of their Lordships of the Supreme Court in Somnath Sarkar vs. Utpal Basu Mallick and another, 2014 Cri.LJ 179; paragraph 11 of the report states the precise principle and reads thus:

"17.....Unlike that for other forms of crime, the punishment here (in so far as the complainant is concerned) is not a means of seeking retribution, but is more a means to ensure payment of money. The complainant's interest lies primarily in recovering the money rather than seeing the drawer of the cheque in jail. The threat of jail is only a mode to ensure recovery. As against the accused who is willing to undergo a jail term, there is little available as remedy for the holder of the cheque."

(emphasis supplied)

We do not consider it necessary to examine or exhaustively enumerate situations in which Courts may remain content with imposition of a fine without any sentence of imprisonment. There is considerable judicial authority for the proposition that the Courts can reduce the period of imprisonment depending upon the nature of the transaction, the bona fides of the accused, the contumacy of his conduct, the period for which the prosecution goes on, the amount of the cheque involved, the social strata to which the parties belong, so on and so forth. Some of these factors may indeed make out a case where the Court may impose only a sentence of fine upon the defaulting drawer of the cheque. There is for that purpose considerable discretion vested in the Court concerned which c

an and ought to be exercised in appropriate cases for good and valid reasons. Suffice it to say that the High Court was competent on a plain reading of Section 138 to impose a sentence of fine only upon the appellant. In as much as the High Court did so, it committed no jurisdictional error. In the absence of a challenge to the order passed by the High Court deleting the sentence of imprisonment awarded to the appellant, we do not consider it necessary or proper to say anything further at this stage.

Looking to the facts of the case in hand the Court finds that the parties hail from a respectable social background and the bounced cheque is the result of some financial hardship faced by the revisionist at the relevant time. The Court also finds that sum of money for which the bounced cheque has been issued is a sum of Rs. 20,000/- which is a moderate sum of money and not a figure as would show some grand act of cheating. The purpose of the complainant is ultimately to recover her money lost on the bounced cheque. This certainly would not be achieved by putting the revisionist in prison.

It is also relevant to record that when this revision was entertained, this Court by an order dated 29.03.2007 enlarged the revisionist on bail but stayed the realization of the sum of compensation awarded by the courts below being a sum of Rs. 30,000/- on deposit of half of that sum. Thus, a sum of Rs. 15,000/- has come to be deposited by the revisionist in compliance with the order dated 29.03.2007 passed by this Court. Therefore, the revisionist has been able to realize a substantial part of the proceeds of her cheque by virtue of the order dated 29.03.2007 passed by this Court.

In the totality of circumstances, this Court is of opinion that the ends of justice would be met if the amount of fine in the sum of Rs. 2,000/- is enhanced to a sum of Rs. 40,000/-, that is to say, twice the sum of proceeds due on the bounced cheque. At the same time, the sentence of three months rigorous imprisonment ordered by the courts below deserves to be set aside as also the compensation in the sum of Rs. 30,000/- ordered. The sum of enhanced fine on deposit by the revisionist or on realization would be payable to the complainant-respondent no.2 as compensation by virtue of Section 357 (3) Cr.P.C.

In the result, this revision succeeds and is allowed in part. The conviction of the revisionist under Section 138 of Negotiable Instrument Act is upheld. The sentence of three months rigorous imprisonment is set aside. The compensation in the sum of Rs. 30,000/- is also set aside. The fine of Rs. 2000/- imposed by the courts below is enhanced to a sum of Rs. 40,000/-. A sum of Rs. 15,000/- if deposited by the revisionist or in default if the same has been realized pursuant to order of this Court dated 29.03.2007 shall be adjusted against the enhanced amount of fine leviable. The total sum of Rs. 40,000/- realized by way of fine from the revisionist, after adjusting any moneys already received by the complainant-Respondent No.2 under interim orders of this Court, would be paid to the complainant without delay. The personal bond furnished by the revisionist stands cancelled.

Let a copy of the order be certified to the Trial Court forthwith.

Order Date :- 23.11.2017

Imroz