Andhra Pradesh High Court - Amravati

J.V. Ramaraju, vs M/S Sundaram Finance Ltd., Anotherk on 5 January, 2024

          THE HON'BLE SRI JUSTICE V.SRINIVAS

         CRIMINAL REVISION CASE No.368 of 2010

ORDER:

Assailing the judgment dated 23.02.2010 in Crl.A.No.110

of 2008 on the file of the Court of learned III Additional Sessions

Judge (FTC), Bhimavaram, confirming the conviction and

sentence imposed by the judgment dated 15.04.2008 in

C.C.No.12 of 2007 on the file of the Court of learned Judicial

Magistrate of First Class, Bhimavaram, for the offence under

section 138 of Negotiable Instruments Act (hereinafter referred

to as "N.I.Act"), the petitioner/accused filed the present criminal

revision case under Section 397 r/w.401 of the Criminal

Procedure Code, 1973 (hereinafter referred to as "Cr.P.C.").

2. The revision case was admitted on 25.02.2010 and the

sentence of imprisonment imposed against the petitioner was

suspended, vide orders in Crl.R.C.M.P.No.547 of 2010.

3. The shorn of necessary facts are that:

i). The complainant, M/s.Sundaram Finance Limited has

been doing finance business and its sister concern

Lakshmi General Finance is having branch at

Bhimavaram. Petitioner/accused was approached the

said Lakshmi General finance and availed finance of

Rs.4,50,000/- for purchase of lorry on hire purpose. The

said amount was paid to him by way of cheque for

Rs.1,75,000/- drawn in his favour and the remaining

amount of Rs.2,75,000/- by way of cheque drawn in

favour of P.Muralikrishnam Raju, who is the authorized

agent of the petitioner.

ii). Petitioner and the said Lakshmi General Finance

have entered into a bilateral agreement dated

03.12.2004. According to which, accused has to pay the

loan amount along with interest within thirty-five (35)

equal installments and one R.Ramakrishnam Raju stood

as guarantor for such transaction.

iii). The said Lakshmi General Finance Company was

amalgamated into the complainant company and it was

upheld by the High Court of Judicature of Madras on

25.02.2005. Thereby, the complainant company is

authorized to recover the balance amount from the

petitioner. On being made a demand by the complainant

for repayment of balance, the petitioner has issued a

cheque for Rs.2,49,119/- on 15.11.2006 drawn on Bank

of Baroda, Bhimavaram branch towards part payment of

the balance due.

iv). Subsequently, the said cheque was presented by the

complainant in its account in Indian Overseas Bank,

Bhimavaram and it was returned by the petitioner's

bank with a memo dated 17.11.2006 as account closed

and the same was informed to the complainant by its

banker with a memo dated 18.11.2006. Then the

complainant got issued a legal notice to the petitioner,

but the said notice was returned as 'person not

available'. Hence, the complaint.

4. Now the point that arises for determination in this

revision is "whether there is any manifest error of law or flagrant

miscarriage of justice in the findings recorded by the Trial Court

as well first Appellate Court?"

5. Sri B.Chandrasekhar, learned counsel representing Sri

Raja Reddy Koneti, learned counsel for the petitioner, submits

that the 1st respondent without there being any proper material

filed the calendar case and the trial Court as well Sessions

Court committed error in passing the judgment in favour of 1st

respondent herein.

6. He further submits that complaint filed without proper

authorization, which is nothing but illegal and as such the same

is liable to be rejected; that the complainant is not a person in

whose favour the alleged cheque was issued, thereby, the

complaint itself is not maintainable and there is no legally

enforceable debt and there is no obligation on the part of the

petitioner/accused to discharge the same.

7. In view of the facts and contentions raised by the learned

counsel, this Court closely perused the material available on

record. The complainant examined one J.B.V.Subrahmanyam,

who is Branch Manager of Complainant's Company, before the

trial Court. In his evidence, he reiterated the facts stated in the

complaint and through him Exs.P.1 to P.11 were exhibited and

he was cross examined at length by the learned counsel for the

accused.

8. The contention before the trial Court by the accused is

that the cheque in question covered under Ex.P.4 is a postdated

cheque, the said cheque was filled and without the knowledge of

the accused presented into the bank. It is also contended that

the complainant company i.e., M/s.Sundaram Finance Limited

has no right to take any legal action against the

petitioner/accused and that accused has no liability to

discharge the amount covered under Ex.P.4.

9. The trial Court after the evaluating the evidence placed on

record held that when the cheque was drawn for payment of

amount towards discharge of liability and the cheque was

dishonoured; that the same was presented within prescribed

period; that payee made a demand for payment of the money by

giving a notice in writing to the drawer within the stipulated

period and that the drawer failed to make the payment within

fifteen (15) days of the receipt of the notice, the accused is liable

for punishment under the N.I.Act and the trial Court after

discussing the above said legal points also placed reliance on

judgments reported in K.Bhaskaran v. Sankaran Vaidhyan

Balan1as well Musaraf Hossain Khan v. Bhagheeratha

Engg. Ltd.2and D.Vinod v. Shiyappa3 and after considering

the entire material on record i.e., Exs.P.1 to P.11 and as there is

no other evidence to disprove the contents in the evidence of

P.W.1, the trial Court found the accused guilty of the offence

under Section 138 of N.I.Act and sentenced him to undergo

simple imprisonment for a period of six (6) months and to pay

12001 ALT (Crl.) 42 (SC) 22006 (3) SCJ 604 32006 (8) SCJ 63

fine of Rs.5,000/-, in default to suffer simple imprisonment for

one (1) month.

10. Aggrieved by the same, the petitioner/accused filed an

appeal, vide Crl.A.No.110 of 2008, before the learned III

Additional Sessions Judge (FTC), Bhimavaram. The learned

Sessions Judge categorically held at paragraph No.10 of the

impugned judgment that "the initial burden is on the complaint

to prove that there is preexisting liability and in discharge of the

said debt the cheque in question was issued and also held that

the complainant issued Ex.P.1 authorization to P.W.1 to look all

legal matters on behalf of the complainant company".

11. The learned Sessions Judge also considered the

contention of the accused that the complainant failed to

establish that M/s.Lakshmi General Finance Limited was

amalgamated with the complainant company. But, the learned

Sessions Judge, after elaborate discussion held that, Ex.P.10

discloses that by order is with effect from 01.04.2004 and

M/s.Lakshmi General Finance Limited was amalgamated to the

complainant company. Further Ex.P.11 account copy of the

complainant relating to the accused discloses that the accused

used to pay the installments to the complainant company even

after amalgamation. Thereby, it can be said that accused

recognized the complainant company and is aware of the fact

that M/s.Lakshmi General Finance Limited is amalgamated

with the complainant company and as such he paid

installments even after 01.04.2004 as born out from Ex.P.11

account copy.

12. As such, the learned Sessions Judge also found that the

accused issued Ex.P.4 cheque in discharging legally enforceable

debt for the preexisting liability of him. It is also found that even

the accused also paid the amount to the complainant company

and the account copy under Ex.P.11 clearly goes to show that

he paid installments after amalgamation of its sister concern.

Therefore, the complaint has proved its contentions and to

rebut the same, even the accused did not enter into witness box

nor placed any record or piece of paper to show that he is not

liable to discharge the debt amount rather legally enforceable

debt covered under Ex.P.4.

13. Section 139 of N.I.Act enjoins the Court to presume that

the holder of the cheque received it for the discharge of any debt

or liability and the burden is only on the accused to rebut the

said presumption. Thereby, before the trial Court the complaint

established its case and both the Courts below rightly

appreciated the material on record and found the guilt of the

accused under Section 138 of N.I.Act and in view of the above

discussion there are no grounds put forth by the petitioner to

interfere with the concurrent findings recording by both the

Courts below.

14. It is settled law that the revisional court should not re-

appreciate the evidence or interfere with the findings of fact,

unless they are perverse or unreasonable. This is one of the

principles of criminal revision, as laid down by the Supreme

Court of India in several cases. The revisional court should not

act as a second appellate court and substitute its own views for

those of the Court below, unless there is a clear error of law or a

gross injustice in the order or proceeding of the lower court. The

revisional court should exercise its power with caution and

restraint, and only in exceptional cases where there is a

manifest illegality or a serious miscarriage of justice.

15. In the present case on hand, this Court does not find any

such error of law or a gross injustice in the order or proceeding

of the Court below/Sessions Court to exercise revisional power.

16. However, now, coming to operation of sentence is

concerned, the learned counsel for the petitioner brought to the

notice of this Court a judgment of this Court reported in

Laxminivas Agarwal v. Andhra Semi Conductors

Pvt.Ltd.4as well judgment of Hon'ble Supreme Court reported in

Bir Singh v. Mukesh Kumar5, wherein at paragraph Nos.18,

19, 28 and 29 held as follows:

18. The Appellate Court affirmed the aforesaid factual findings. The Trial Court and the Appellate Court arrived at the specific concurrent factual finding that the cheque had admittedly been signed by the respondent-accused.

The Trial Court and the Appellate Court rejected the plea of the respondent-accused that the appellant- complainant had misused a blank signed cheque made over by the respondent-accused to the appellant- complainant for deposit of Income Tax, in view of the admission of the respondent-accused that taxes were paid in cash for which the appellant-complainant used to take payment from the respondent in cash.

19. It is well settled that in the exercise of revisional jurisdiction under Section 482 of the Criminal Procedure Code, the High Court does not, in the absence of perversity, upset concurrent factual findings. It is not for the Revisional Court to re-analyze and re-interpret the evidence on record.

28. In R.Vijayan vs. Baby and Another (2012) 1 SCC 260 this Court observed that the object of Chapter XVII of the Negotiable Instruments Act is both punitive as also compensatory and restitutive. It provides a single forum and single proceeding for enforcement of criminal liability by reason of dishonour of cheque and for enforcement of

4(2006) 1 ALD Crl.300 (A.P.) 5(2019) 4 SCC 197

the civil liability for realization of the cheque amount, thereby obviating the need for the creditor to move two different for a for relief. This Court expressed its anguish that some Magistrates went by the traditional view, that the criminal proceedings were for imposing punishment and did not exercise discretion to direct payment of compensation, causing considerable difficulty to the complainant, as invariably the limitation for filing civil cases would expire by the time the criminal case was decided".

17. It is also brought to the notice of this Court a judgment of

the Hon'ble Supreme Court reported in Meters and

Instruments Private Limited v. Kanchan Mehta6, wherein at

paragraph No.18 held as follows:

"18. From the above discussion following aspects emerge:

i) Offence under Section 138 of the Act is primarily a civil wrong. Burden of proof is on accused in view presumption under Section 139 but the standard of such proof is "preponderance of probabilities". The same has to be normally tried summarily as per provisions of summary trial under the Cr.P.C. but with such variation as may be appropriate to proceedings under Chapter XVII of the Act.

Thus read, principle of Section 258 Cr.P.C. will apply and the Court can close the proceedings and discharge the accused on satisfaction that the cheque amount with

6AIR 2017 SC 4594

assessed costs and interest is paid and if there is no reason to proceed with the punitive aspect.

ii) The object of the provision being primarily compensatory, punitive element being mainly with the object of enforcing the compensatory element, compounding at the initial stage has to be encouraged but is not debarred at later stage subject to appropriate compensation as may be found acceptable to the parties or the Court.

iii) Though compounding requires consent of both parties, even in absence of such consent, the Court, in the interests of justice, on being satisfied that the complainant has been duly compensated, can in its discretion close the proceedings and discharge the accused.

iv) Procedure for trial of cases under Chapter XVII of the Act has normally to be summary. The discretion of the Magistrate under second proviso to Section 143, to hold that it was undesirable to try the case summarily as sentence of more than one year may have to be passed, is to be exercised after considering the further fact that apart from the sentence of imprisonment, the Court has jurisdiction under Section 357(3) Cr.P.C. to award suitable compensation with default sentence under Section 64 IPC and with further powers of recovery under Section 431 Cr.P.C. With this approach, prison sentence of more than one year may not be required in all cases.

v) Since evidence of the complaint can be given on affidavit, subject to the Court summoning the person giving affidavit and examining him and the bank's slip being prima facie evidence of the dishonor of cheque, it is unnecessary for the Magistrate to record any further preliminary evidence. Such affidavit evidence can be read as evidence at all stages of trial or other proceedings. The manner of examination of the person giving affidavit can be as per Section 264 Cr.P.C. The scheme is to follow summary procedure except where exercise of power under second proviso to Section 143 becomes necessary, where sentence of one year may have to be awarded and compensation under Section 357(3) is considered inadequate, having regard to the amount of the cheque, the financial capacity and the conduct of the accused or any other circumstances."

18. Considering the above authoritative pronouncements and

as discussed supra, this Court does not find any grounds to

interfere with the concurrent findings recorded by both the

Courts below regarding conviction under Section 138 of N.I.Act

against the petitioner. However, to meet the ends of justice, the

petitioner/accused is directed to pay the cheque amount of

Rs.2,49,119/- to the complainant within three (3) months from

today, in default he shall undergo the sentence of imprisonment

as well fine as affirmed by the trial Court, which was confirmed

by the Appellate Court. Accordingly, the revision petitioner is

directed to appear before the trial court on or before

05.04.2024, to receive the sentence of imprisonment or to pay