Kerala High Court

C.Joshy vs George Thomas on 5 November, 2024

CRL.A NO. 1763 OF 2007

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                                                    2024:KER:82468

             IN THE HIGH COURT OF KERALA AT ERNAKULAM
                              PRESENT
             THE HONOURABLE MRS. JUSTICE SOPHY THOMAS
    TUESDAY, THE 5TH DAY OF NOVEMBER 2024 / 14TH KARTHIKA, 1946
                       CRL.A NO. 1763 OF 2007
      AGAINST THE JUDGMENT DATED 06.03.2007 IN ST NO.494 OF 2004
OF JUDICIAL FIRST CLASS MAGISTRATE COURT -II, PEERUMEDU
APPELLANT/COMPLAINANT:

          C.JOSHY
          CHENGALATHUPARAMBIL VEEDU,, SPRINGVALLY, KUMILY.


          BY ADV SRI.T.A.UNNIKRISHNAN

RESPONDENTS/ACCUSED & STATE:

    1     GEORGE THOMAS
          KUMBALANTHANAM VEEDU,, ATTAPPALAM.PO, KUMILY.

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

          BY ADVS.
          RINCY R.
          P.C.CHACKO(PARATHANAM)

OTHER PRESENT:

          PP-SMT.SEENA C.

     THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 05.11.2024,
THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
 CRL.A NO. 1763 OF 2007

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                           J U D G M E N T

This appeal is at the instance of the complainant in

S.T. No. 494 of 2004 on the file of Judicial First Class Magistrate

Court-II Peerumedu, challenging acquittal of the accused, under

Section 138 of the Negotiable Instruments Act (for short, 'the NI

Act') vide judgment dated 06.03.2007.

2. The case of the complainant was that, the accused

borrowed Rs.2 lakh from him, and towards discharge of that debt,

he issued Ex.P1 cheque dated 06.05.2003, assuring him that it

would be encashed on presentation before the bank. But that

cheque was bounced on presentation before the bank, for the

reason 'funds insufficient', vide Ext.P2 memo. The complainant

sent registered lawyer notice to the accused intimating dishonour

of the cheque and demanding the cheque amount. Though the

accused received that notice, the amount was not returned, and

hence the complaint.

3. After taking cognizance and on appearance of the accused

before the trial court, particulars of offence were read over and

explained, to which he pleaded not guilty, and claimed to be tried. CRL.A NO. 1763 OF 2007

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Thereupon PW1 was examined, and Ext.P1 to P6 were marked from

the side of the complainant to prove his case. On closure of

complainant's evidence, accused was questioned under section

313 of Cr.P.C. He denied all the incriminating circumstances

brought on record, and stated that, he had borrowed Rs.2,50,000/-

from the complainant on 04.06.2002, and repaid that amount with

interest. Misusing the blank cheque given as security at the time of

borrowing that amount, the complainant filed a false complaint

against him. DWs 1 to 3 were examined, and Exts. D1 and D2

were marked from defence side.

4. On analysing the facts and evidence, and on hearing the

rival contentions from either side, the trial court found the accused

guilty under Section 138 of NI Act, and he was sentenced to

undergo simple imprisonment for 2 months and compensation of

Rs.2 lakh, with a default sentence of simple imprisonment for 1

month. Aggrieved by the conviction and sentence, the accused

preferred Crl.Appeal No. 224 of 2005 before Additional District &

Sessions Judge (Adhoc II) Thodupuzha. As per judgment dated

12.04.2006, the appellate court set aside the conviction and CRL.A NO. 1763 OF 2007

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sentence, and remanded back the case to the trial court for fresh

disposal, after affording opportunity to the parties to adduce

further evidence, if any. After remand, PW1 was recalled and

examined from the side of the complainant, DWs 4 and 5 were

examined, and Exts.D3 and D4 were marked from the side of

accused. On a reappraisal of the evidence, including the additional

evidence adduced after the remand, the trial court acquitted the

accused finding that Ext.P1 cheque was not supported by

consideration, and it was not issued towards discharge of a legally

enforceable debt. Aggrieved by the acquittal of the accused, the

complainant has preferred this appeal.

5. Heard learned counsel for the appellant/complainant and

learned counsel for the 1st respondent/accused.

6. Learned counsel for the appellant would submit that, the

accused borrowed Rs.2 lakh from him and issued Ext.P1 cheque

towards discharge of that debt. Since that cheque was dishonoured

for the reason funds insufficient, he filed the complaint after

completing all the statutory formalities. Moreover, the

presumptions available under Sections 118 and 139 of the NI Act, CRL.A NO. 1763 OF 2007

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will come to the aid of the appellant to hold that Ext.P1 cheque was

issued towards discharge of a legally enforceable debt. So the

acquittal of the accused by the trial court is liable to be set aside.

7. Learned counsel for the 1st respondent would argue that,

the evidence adduced by DWs 1 to 5 coupled with Exts.D1 to D4

documents were sufficient to the rebut the presumptions available

in favour of the complainant under Sections 118 and 139 of the NI

Act. The case of the 1st respondent was that, on 04.06.2002, he

borrowed Rs.2,50,000/- from the appellant for purchasing a

property for his brother, on the basis of Ext.D1 sale agreement and

he approached the appellant through DW2 Pankajakshan, and

availed a loan of Rs.2,50,000/-, from him, agreeing to pay monthly

interest @ Rs.20,000/-. He was paying interest on monthly basis

through DW5 - Venu, who was the hotel Manager of the appellant,

in his hotel named Maharani. When he borrowed the amount on

04.06.2002, he had given a blank cheque and blank signed stamp

paper as security as demanded by the appellant. The 1st

respondent repaid Rs.2,50,000/- to the appellant on 10.01.2003,

when he received advance amount of Rs.3 lakh, as per Ext.D2 sale CRL.A NO. 1763 OF 2007

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agreement. Only to see whether he could extract some more

money, the appellant filed the complaint, misusing the blank

cheque given by the 1st respondent, at the time of borrowing the

amount.

8. PW1, the appellant, admitted that DW5 - Venu was the

Manager in his hotel. DW2 - Pankajakshan also is familiar to him.

In the complaint, the case of the appellant was that, the 1st

respondent borrowed Rs.2 lakh from him on 30.01.2003 at his

house at Spring Valley, Kumily. But, before court, his case was that

the amount was advanced at his hotel at Kumily. He was admitting

presence of DW5 Venu and other staff of the hotel, when he

advanced that amount. The 1st respondent is relying on Ext.D3

document alleged to have been written by DW5, on receipt of

amounts paid by the 1st respondent, on various dates. When PW1

was confronted with that document, he pleaded ignorance.

According to him, DW5 - Venu is in good terms with him. It is

pertinent to note that PW1 was not denying Ext.D3 document

alleged to have been written by his own Manager Sri.Venu. DW5 -

Venu, when confronted with Ext.D3 document, would say that the CRL.A NO. 1763 OF 2007

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handwriting appears to be similar to that of his handwriting, though

he was not directly admitting that handwriting. DW3 - Francis

George admitted that Ext.D2 sale agreement was there between

himself and the 1st respondent, by which he agreed to purchase

the property of the 1st respondent, and he had given Rs.3 lakh to

him as advance amount on 10.01.2003. Ext.D3 accounts shows

that Rs.2,50,000/- was paid in January 2003, which will

substantiate the case of the 1st respondent. True that, there is no

signature of the appellant, accused or of DW5 in Ext.D3 document.

But, from the indirect admissions made by DW5, it could be seen

that, he wrote the same. That document will substantiate the case

put forward by the 1st respondent that, he had received

Rs.2,50,000/- from the appellant on 04.06.2002, in connection

with Ext.D1 property transaction.

9. Learned counsel for the 1st respondent would submit that,

when the evidence adduced by the 1st respondent was sufficient to

doubt the existence of consideration for the cheque, then the onus

will shift to the appellant. According to him, if the materials on

record are consistent with the innocence of the accused, which may CRL.A NO. 1763 OF 2007

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reasonably be true, even though it is not positively proved to be

true, the accused will be entitled for acquittal. The standard of

proof required is only preponderance of probabilities, and inference

of preponderance of probabilities can be drawn, not only from the

materials on record but also by reference to the circumstances

upon which, he relies.

10. Learned counsel for the appellant contended that, there

was no probability for the appellant to advance Rs.2 lakh to the 1st

respondent on 30.01.2003, when Rs.2,50,000/- advanced on

04.06.2002, as seen from Ext.D3 document was still outstanding.

Re-payment under Ext.D3 was there till April 2003, and if so, there

was no chance for the appellant to again advance Rs. 2 lakh, even

before clearing the earlier liability. DW4 the earlier counsel for the

1st respondent deposed that original of Ext.D3 was entrusted with

him, but after confronting that document with PW1, it was

misplaced and lost. DW5 admitted that, the 1st respondent and

DW4 approached him, stating that the original accounts written by

him was lost, and so he had given another document like Ext.D3 in

his own handwriting. But at the same time, he was not able to say CRL.A NO. 1763 OF 2007

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whether Ext.D3 was the account so written by him, on the request

of the 1st respondent, and his counsel.

11. Learned counsel for the 1st respondent would submit that

though Ext.D3 document was not fully accepted by DW5, the

available facts and circumstances are sufficient to infer that, DW5

being the Manager of the appellant, was receiving the money given

by the 1st respondent, towards the principal and interest which

was due to the appellant. On receipt of money, DW5 had endorsed

it in his own handwriting. Exts.D1 and D2 documents also will

support the case of the 1st respondent, that for the property

transaction in the year 2002 covered by Ext.D1, the 1st respondent

borrowed money from the appellant and he repaid the principal

amount when he sold away his property as per Ext.D2 sale

agreement in January 2003.

12. In the decision Bharat Barrel & Drum Manufacturing

Company v. Amin Chand Payrelal [(1999) 3 SCC 35], Hon'ble

Apex Court held that if the initial onus of proof was discharged by

the defendant to show that existence of consideration was CRL.A NO. 1763 OF 2007

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improbable or doubtful, then the onus would shift to the plaintiff.

In paragraph 12 of that judgment, we read thus:

"The defendant can prove the non-existence of a consideration by raising a probable defence. If the defendant is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the plaintiff who will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to the grant of relief on the basis of the negotiable instrument. The burden upon the defendant of proving the non-existence of the consideration can be either direct or by bringing on record the preponderance of probabilities by reference to the circumstances upon which he relies. In such an event, the plaintiff is entitled under law to rely upon all the evidence led in the case including that of the plaintiff as well. In case, where the defendant fails to discharge the initial onus of proof by showing the non-existence of the consideration, the plaintiff would invariably be held entitled to the benefit of presumption arising under Section 118(a) in his favour. The court may not insist upon the defendant to disprove the existence of consideration by leading direct evidence as the existence of negative evidence is neither possible nor contemplated and even if led, is to be seen with a doubt. The bare denial of the passing of the consideration apparently does not appear to be any CRL.A NO. 1763 OF 2007

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defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the plaintiff. To disprove the presumption, the defendant has to bring on record such facts and circumstances upon consideration of which the court may either believe that the consideration did not exist or its non-existence was so probable that a prudent man would, under the circumstances of the case, shall act upon the plea that it did not exist."

13. In Kali Ram v. State of Himachal Pradesh (1973) 2

SCC 808, Hon'ble Apex Court held that, though in certain cases

statutory presumptions arise regarding the guilt of the accused, the

burden is upon the prosecution to prove the existence of facts

which have to be present before the presumptions can be drawn.

Only when facts are shown by the prosecution to exist, the court

can raise the statutory presumption, and in such an event, the

accused has to rebut the presumption, and even then, the onus on

the accused is not as heavy, as is normally upon the prosecution, to

prove the guilt of the accused.

14. In the case on hand, after the 1st respondent was

convicted by the trial court, in appeal, his conviction and sentence

was set aside and the matter was remanded back. After adducing CRL.A NO. 1763 OF 2007

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additional evidence, the trial court reappraised the facts and

evidence and again found that, the appellant/complainant could not

prove the guilt of the accused under Section 138 of the NI Act, and

so he was acquitted in the second round also, against which the

present appeal has been preferred.

15. In Chandrappa and others v. State of Karnataka

[(2007) 4 SCC 415], Hon'ble Apex Court deduced the general

principles regarding the powers of the appellate court while dealing

with an appeal against the order of an acquittal as follows:

"(1) An appellate court has full power to review, re-appreciate and reconsider the evidence upon which the order of acquittal is founded. (2) The Code of Criminal Procedure, 1973 puts no limitation, restriction or condition exercise of such power and an appellate court on the evidence before it may reach its own conclusion, both on questions of fact and of law.

(3) Various expressions, such as, "substantial and compelling reasons", "good sufficient grounds", "very strong circumstances", "distorted conclusions", "glaring mistake etc., are not intended to curtail extensive powers of an appellate Court in an appeal CRL.A NO. 1763 OF 2007

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against acquittal. Such phraseologies are more in the nature of "flourishes of language" to emphasize the reluctance of an appellate court to interfere with acquittal than to curtail the power of Court to review the evidence and to come to its own conclusion. (4) An appellate court, however, must bear in mind that in case of acquittal, there is double presumption in favour of the accused. Firstly, the presumption of innocence available to him under the fundamental principle of criminal jurisprudence that every person shall be presumed to be innocent unless he is proved guilty by a competent court of law. Secondly, the accused having secured his acquittal, the presumption of his innocence is further reinforced, reaffirmed, and strengthened by the Trial Court.

(5) If two reasonable conclusions are possible on the basis of the evidence on record, the appellate court should not disturb the finding of acquittal recorded by the trial court."

16. In the instant case, the 1st respondent was acquitted by

the trial court and so, he is having double presumptions available

in his favour, going by the decision cited above. The evidence

adduced by DWs 1 to 5 coupled with Exts.D1 to D4 documents are CRL.A NO. 1763 OF 2007

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sufficient to pick holes in the case of the complainant. It was

sufficient to probabilise the case of the 1st respondent. If so, the

appellant had to prove his case without the aid of presumptions

available under Sections 118 and 139 of the NI Act, but he failed to

do so.

17. Adverting to the facts and circumstances as discussed

above, this Court is of the view that the 1st respondent succeeded