R.Prakash vs S.Latha & State
2023 Latest Caselaw 9911 Ker

             IN THE HIGH COURT OF KERALA AT ERNAKULAM
                               PRESENT
                 THE HONOURABLE MR.JUSTICE C.S.DIAS
    MONDAY, THE 18TH DAY OF SEPTEMBER 2023 / 27TH BHADRA, 1945
                    CRL.REV.PET NO. 413 OF 2011
 IN CC 852/2003 OF JUDICIAL MAGISTRATE OF FIRST CLASS , PARAVOOR
        CRL.APPEAL NO.49/2009 OF THE SESSIONS COURT,KOLLAM
REVISION PETITIONER/APPELLANT/ACCUSED:

          R.PRAKASH
          MUTTATHAZHIKAM, CHATHANNOOR,, KOLLAM.

          BY ADV SRI.P.SIVARAJ



RESPONDENTS/RESPONDENTS/COMPLAINANT & STATE:

    1     S.LATHA
          KALLUVILA VEEDU,, KURUMANDAL B., PARAVUR,, KOLLAM.

    2     STATE OF KERALA
          REP. BY PUBLIC PROSECUTOR,, HIGH COURT OF KERALA,
          ERNAKULAM.

          BY ADV SRI.B.S.SURESH CHIRAKKARA



OTHER PRESENT:

          SR PP SMT SEETHA S

          SRI. RAHUL SUNIL, AMICUS CURIAE




     THIS CRIMINAL REVISION PETITION HAVING COME UP FOR ADMISSION
ON 18.09.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
 Crl.R.P NO. 413 OF 2011         2




            Dated this the 18th day of September, 2023

                            ORDER

The revision petition is filed challenging the

propriety and correctness of the judgment of the Court of

Sessions, Kollam (Appellate Court) in Crl.Appeal

No.49/2009, which in turn confirmed the judgment of the

Court of the Magistrate, Paravoor in C.C.No.852/2003

(Trial Court), convicting and sentencing the revision

petitioner for an offence under Section 138 of the

Negotiable Instruments Act (for brevity, 'N.I.Act'). The

revision petitioner was the accused and the first

respondent was the complainant before the Trial Court.

Factual Matrix

2. The revision petitioner had borrowed a sum of

Rs.2,00,000/- from the first respondent on 25.7.2002 for

his immediate needs. He had issued Ext.P1 cheque in

favour of the first respondent in discharge of the debt.

The cheque on presentation for collection, got

dishonoured by Ext.P2 memo, due to 'insufficient funds'

in the revision petitioner's bank account. Although the

first respondent had issued Ext.P4 lawyer notice, which

was served on the revision petitioner as evidenced by

Ext.P6 acknowledgment card, the revision petitioner

failed to pay the demanded amount. Hence, the revision

petitioner committed the offence under Sec.138 of the

N.I Act.

3. The first respondent had filed the complaint

before the Trial Court, which was taken cognizance of by

the learned Magistrate. The revision petitioner got

himself enlarged on bail. On completion of the statutory

procedural formalities contemplated under the Code of

Criminal Procedure (in short, Cr.P.C.)', the complaint was

posted for trial.

Trial

4. The first respondent was examined as PW1 and

Exts.P1 to P6 were marked through her. The revision

petitioner examined two witnesses as DWs1 and 2 and

Ext.D1 was marked through PW1. The statement of the

revision petitioner was recorded under Section 313

Cr.P.C.

Trial Court Judgment

5. The Trial Court, after analysing the evidence and

materials on record, convicted the revision petitioner for

an offence under Section 138 of the N.I.Act and ordered

him to undergo simple imprisonment for a period of three

months and to pay a compensation of Rs.2,00,000/- to the

first respondent, and in default to realise the amount as a

fine under Section 421 r/w 431 of the Cr.P.C.

6. Confronted with the said judgment, the revision

petitioner filed Crl.A No.49/2009 before the Appellate

Court.

Appellate Court Judgment

7. The Appellate Court, after re-appreciating the

materials on record, by the impugned judgment

confirmed the conviction, but modified the sentence by

directing the revision petitioner to undergo simple

imprisonment for a period of 15 days and to pay a

compensation of Rs.2,75,000/- to the first respondent, and

in default to undergo simple imprisonment for a period of

2 ½ months.

8. Aggrieved by the concurrent judgments passed by

the courts below, the revision petition is filed.

9. Heard; Sri. P.Sivaraj the learned counsel

appearing for the revision petitioner, Sri.Rahul Sunil, the

learned Amicus Curiae and the learned Public Prosecutor

appearing for the second respondent.

10. Sri.P.Sivaraj, argued that the courts below have

gone wrong in concurrently holding the revision

petitioner guilty for an offence under Section 138 of the

N.I.Act. He submitted that the courts below have not

evaluated the evidence in its proper perspective. The

courts below ought to have accepted the oral testimonies

of DWs 1 and 2 and given weightage to Ext.D1, will stand

proved through PW1. He further argued that, as per

Ext.D1, only an amount of Rs.50,000/- was due from the

revision petitioner to the first respondent and out of the

said amount, the revision petitioner had paid an amount

of Rs.20,000/-. Therefore, as on the date of presentation

of cheque, only an amount of Rs.30,000/- was payable by

the revision petitioner to the first respondent. He placed

reliance on the decision of this Court in Santhosh

Mathew and Another v. Santhosh and Another [2022

KHC 428], to canvass the position that once the accused

rebuts the onus of proof, it is upto the complainant to

prove that there is a legally enforceable debt. He prayed

that the revision petition may be allowed.

11. As there was no representation for the first

respondent, this Court appointed Sri. Rahul Sunil as the

Amicus Curiae, to assist this Court. Sri. Rahul Sunil,

submitted that Ext.P1 cheque was issued on 25.7.2002

i.e., subsequent to Ext.D1 agreement, which was

purportedly executed on 3.10.2001. The courts below,

after evaluating Ext.D1 agreement under Section 73 of

the Indian Evidence Act, have concurrently found that the

same has not been executed by the first respondent.

The factual appreciation may not be interfered with by

this Court, as it is beyond the scope of the revisional

powers of this Court. He further submitted that the

revision petitioner has not sent any reply notice or

mounted the box to substantiate his defence. The only

flaw in the prosecution is that Ext.P1 cheque was signed

and written in two inks. He drew the attention of this

Court to the decisions of the Honourable Supreme Court

in Rangappa vs. Sri.Mohan [2010 KHC 4325] and

Kalamani Tex and Anr vs. P. Balasubramanian [2021

(2) KHC 517] and contended that, since reverse onus of

proof is on the accused as under Section 139 of the

N.I.Act, the concurrent findings cannot be found fault

with.

12. Is there any illegality, impropriety or irregularity

in the judgments of the courts below.

13. Before I delve into the legality and correctness of

the impugned judgments, this Court reminds itself of the

scope and purport of the revisional jurisdiction under

Secs.397 to 401 of the Cr.P.C.

14. There is a profusion of precedential authority

that the revisional power of this Court is to be sparingly

exercised and in exceptional rarity. The power is more in

the nature of supervisory jurisdiction, to correct the

miscarriage of justice, if any found. The revisional power

cannot be equated with Appellate/Second Appellate

power. Even if a different view is possible, the revisional

Court shall not substitute the view taken by the

Trial/Appellate Court, unless and until there is patent

illegality, which is shocking to the conscience of the

Court.

15. In Sanjaysinh Ramrao Chavan vs Dattatray

Gulabrao Phalke & Anr [(2015) 3 SCC 123], the

Hon'ble Supreme Court has succinctly laid down the

scope and powers under Secs.397 to 401 of the Cr.P.C. It

is apposite to extract the revisional declaration of law,

which reads as follows:

"14. In the case before us, the learned Magistrate went through the entire records of the case, not limiting to the report filed by the police and has passed a reasoned order holding that it is not a fit case to take cognizance for

the purpose of issuing process to the appellant. Unless the order passed by the Magistrate is perverse or the view taken by the court is wholly unreasonable or there is non- consideration of any relevant material or there is palpable misreading of records, the Revisional Court is not justified in setting aside the order, merely because another view is possible. The Revisional Court is not meant to act as an

appellate court. The whole purpose of the revisional jurisdiction is to preserve the power in the court to do justice in accordance with the principles of criminal jurisprudence. The revisional power of the court under Sections 397 to 401 CrPC is not to be equated with that of an appeal. Unless the finding of the court, whose decision is sought to be revised, is shown to be perverse or untenable in law or is grossly erroneous or glaringly unreasonable or where the decision is based on no material or where the material facts are wholly ignored or where the judicial discretion is exercised arbitrarily or capriciously, the courts may not interfere with decision in exercise of their revisional jurisdiction."

16. Coming back to the facts of the instant case.

17. The revision petitioner's pivotal defence was that

he had not borrowed any amount from the first

respondent. Instead, it was their common friend one

Binukumar, who borrowed an amount of Rs.50,000/- from

the first respondent, and in discharge of the said debt,

the revision petitioner had issued Ext.P1 cheque. Ext.D1

agreement purportedly executed between the revision

petitioner, first respondent and Binukumar, establishes

this aspect. Hence, the prosecution initiated against the

revision petitioner is bad.

18. The revision petitioner does not dispute the

execution and the issuance of Ext.P1 cheque. His defence

is that, as per Ext.D1 agreement, Binukumar was paid

only Rs.50,000/- by the first respondent.

19. The Trial Court, invoking its power under

Section 73 of the Indian Evidence Act, examined the

signature of the first respondent in the vakkalath,

complaint, her deposition and on Ext.D1 agreement, and

arrived at a conclusion that Ext. D1 agreement was not

executed by the first respondent. The Appellate Court

also re-appreciated this aspect and arrived at the same

conclusion. Thus, the courts below have concurrently

found the fact that the first respondent had not

subscribed to Ext.D1 agreement, which demolishes the

defence set up by the revision petitioner.

20. It is to be remembered that Ext. D1 agreement

was executed on 3.10.2001 and Ext.P1 cheque was issued

merely after a year on 25.7.2002.

21. Indisputably, the revision petitioner has not sent

any reply to Ext.P4 lawyer notice. Even though, he let in

defence evidence through DWs1 and 2, the courts below

have found that the said witnesses have no direct

knowledge with respect to transaction. Furthermore, the

revision petitioner has no clue regarding Binukumar, who

is the main witness, who also has not examined.

22. On the revision petitioner admitting the

execution and issuance of Ext.P1 cheque, the reverse

onus of proof has fallen on his shoulders to establish that

Ext.P1 cheque was not issued towards the legally

enforceable debt as laid down in Rangappa & Kalmani

Tex (supra).

23. A negotiable instrument, which includes a

cheque, carries the presumption of consideration under

Secs.118(a) and 139 of the N.I Act. It is profitable to

extract the said relevant provisions:

"118. Presumptions as to negotiable instruments - Until the contrary is proved, the following presumptions shall be made;-

(a) of consideration-that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration;

139. Presumption in favour of holder. --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.

24. A three-Judge Bench of the Hon'ble Supreme

Court in Rangappa vs. Sri.Mohan [2010 KHC 4325],

while dealing with Sec.139 of the N.I Act has

conceptualised the doctrine of 'reverse onus', by holding

thus:

" 18. In light of these extracts, we are in agreement with the respondent - claimant that the presumption mandated by S.139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat (supra) may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant. S.139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While S.138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under S.139 is a device to prevent undue delay in the course of litigation. However, it must be

remembered that the offence made punishable by S.138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused / defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under S.139, the standard of proof for doing so is that of 'preponderance of probabilities'. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his / her own. 15. Coming back to the facts in the present case, we are in agreement with the High Court's view that the accused did not raise a probable defence. As noted earlier, the defence of the loss of a blank cheque was taken up belatedly and the accused had mentioned a different date in the 'stop payment' instructions to his bank. Furthermore, the instructions to 'stop payment' had not even mentioned that the cheque had been lost. A perusal of the trial record also shows that the accused appeared to be aware of the fact that the cheque was with the complainant. Furthermore, the very fact that the accused had failed to reply to the statutory notice under S.138 of the Act leads to the inference that there was merit in the

complainant's version. Apart from not raising a probable defence, the appellant - accused was not able to contest the existence of a legally enforceable debt or liability. The fact that the accused had made regular payments to the complainant in relation to the construction of his house does not preclude the possibility of the complainant having spent his own money for the same purpose. As per the record of the case, there was a slight discrepancy in the complainant's version, in so far as it was not clear whether the accused had asked for a hand loan to meet the construction - related expenses or whether the complainant had incurred the said expenditure over a period of time. Either way, the complaint discloses the prima facie existence of a legally enforceable debt or liability since the complainant has maintained that his money was used for the construction - expenses. Since the accused did admit that the signature on the cheque was his, the statutory presumption comes into play and the same has not been rebutted even with regard to the materials submitted by the complainant.

25. Recently, a three-Judge Bench of the Hon'ble

Supreme Court in Kalamani Tex and Anr vs. P.

Balasubramanian [2021 (2) KHC 517] has reiterated the

legal position and doctrine of the reverse onus. It is

apposite to extract the relevant paragraphs, which

declare the law on the point in the following terms:

"14. Adverting to the case in hand, we find on a plain reading of its judgment that the trial Court completely overlooked the provisions and failed to appreciate the

statutory presumption drawn under Section 118 and Section 139 of NIA. The Statute mandates that once the signature (s) of an accused on the cheque/negotiable instrument are established, then these 'reverse onus' clauses become operative. In such a situation, the obligation shifts upon the accused to discharge the presumption imposed upon him. This point of law has been crystalized by this Court in Rohitbhai Jivanlal Patel v. State of Gujarat (2019 (2) KHC

243)."

26. Similarly, in M/s.Shree Daneshwari Traders vs

Sanjay Jain [2019 (4) KHC 495], the Hon'ble Supreme

Court has held as follows:

"16. Under Section 138 of the Negotiable Instruments Act, once the cheque is issued by the drawer, a presumption under Section 139 of the Negotiable Instruments Act in favour of the holder would be attracted. Section 139 creates a statutory presumption that a cheque received in the nature referred to under Section 138 of the Negotiable Instruments Act is for the discharge in whole or in part of any debt or other liability. The initial burden lies upon the complainant to prove the circumstances under which the cheque was issued in his favour and that the same was issued in discharge of a legally enforceable debt.

17. It is for the accused to adduce evidence of such facts and circumstances to rebut the presumption that such debt does not exist or that the cheques are not supported

by consideration. Considering the scope of the presumption to be raised under Section 139 of the Act and the nature of evidence to be adduced by the accused to rebut the

presumption.

27. As discussed in the preceding paragraphs of the

oral testimonies of DWs 1 & 2 read with Ext D1

agreement have been concurrently discarded by the

courts below, as they did not inspire confidence, which

this Court endorses. On the contrary, I find a ring of truth

in the oral testimony of PW1, which stands corroborated

with Exts. P1 to P6 documents.

28. An upshot of the above discussion leads me to the

irresistible conclusion that there is no illegality or

impropriety in the concurrent findings of the courts

below, which establish that the revision petitioner had

issued Ext.P1 cheque in discharge of a legally enforceable

debt and has failed to shift the reverse onus of proof

under Section 139 of the N.I.Act.

29. Finally, coming to the question of sentence.

30. As extracted above, the Trial Court had

sentenced the revision petitioner to undergo simple

imprisonment for a period of three months and to pay a

compensation of Rs.2,00,000/-. The Appellate Court

modified the sentence by directing the revision petitioner

to undergo simple imprisonment for a period of 15 days

and to pay a compensation of Rs.2,75,000/- and on default

to undergo simple imprisonment for a further period of 2

½ months.

31. The Hon'ble Supreme Court has in a plethora of

precedents held that Section 138 of the N.I. Act is more

civil in nature, and the intention of the legislature is to

provide the drawer of the cheque an opportunity to pay

the debt, rather than incarcerating the accused in prison

because it would serve no fruitful purpose, especially to

the complainant. Therefore, the substantive sentence can

always be limited to a minimum period, with an order to

pay fine, and out of which the complainant can be paid

compensation.

32. In the light of the above exposition of law, I am

inclined to modify the sentence, by reducing it from 15

days to one day (till the rising of the court) and directing

the revision petitioner to pay a compensation of

Rs.3,00,000/- to the first respondent and in default to

undergo simple imprisonment for a period of six months.

33. In the result,

(i) The revision petition is allowed in part.

(ii) The conviction imposed by the Trial Court and

confirmed by the Appellate Court stand confirmed.

(iii) The substantive sentence stands modified as

under:

(a) The revision petitioner/accused shall undergo

simple imprisonment for a day, (till the rising of the

court), and to pay a compensation of Rs.3,00,000/-

(Rupees three lakh only) and in default of payment of

compensation, the revision petitioner shall undergo

simple imprisonment for a period of six months. If the

compensation amount is deposited, the same shall be

released to PW1, in accordance with law.

(b) Needless to mention, if the revision petitioner

has already deposited any amount, as directed by the

Appellate Court or this Court, only the balance amount

need be remitted.

(c) The revision petitioner is directed to appear

before the Trial Court on or before 18.11.2023 to undergo

the modified sentence and to pay the compensation

amount.

(d) In case of failure of the revision petitioner to

appear before the Trial Court as ordered above, to

undergo the sentence and to pay the compensation

amount, the Trial Court is directed to execute the

sentence without fail, in accordance with law.

(e) The execution of the sentence shall stand

deferred till 18.11.2023.

(iv) The Registry is directed to forthwith forward a

copy of this order to the Trial Court, for compliance.

(v) This Court places on record its appreciation for

Sri. Rahul Sunil, the Amicus Curiae, for the valuable

assistance rendered in the matter.

Sd/-

C.S.DIAS, JUDGE

rmm18/9/2023