Madras High Court
A.Subramanian vs P.Kannammal on 20 April, 2023
Crl.R.C.No.400 of 2020
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Dated : 20.04.2023
CORAM :
THE HONOURABLE Dr. JUSTICE G.JAYACHANDRAN
Crl.R.C.No.400 of 2020
and
Crl.M.P.Nos.3178 & 3179 of 2020
A.Subramanian .. Petitioner
Vs.
P.Kannammal ..Respondent
The Public Prosecutor ...Formal Party
PRAYER : Criminal Revision Case has been filed under sections 397
read with 401 of Criminal Procedure Code to set aside the judgment of
the I Additional District and Sessions Judge, Erode on 31.10.2019 in
Crl.A.No.97 of 2015 confirming the conviction and sentence passed by
the learned Judicial Magistrate Fast Track No.II, Erode in S.T.C.No.331
of 2013 dated 21.07.2015.
For Petitioner : M/s.M.Lourdu
For Respondent : Steps not taken & died
1/14
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Crl.R.C.No.400 of 2020
ORDER
Heard the learned counsel for the Revision Petitioner.
2. This Criminal Revision Case is filed against the concurrent
findings of the Courts below holding that the revision petitioner was
guilty of offence under Section 138 of Negotiable Instruments Act for
issuing a cheque for Rs.5,00,000/- to the respondent after closing the
account.
3. According to the complaint, the revision petitioner borrowed
a sum of Rs.5,00,000/- from the complainant on 22.12.2012. To
discharge the debt, he gave the subject cheque dated 22.01.2013 for
Rs.5,00,000/- When the cheque was presented for collection, it got
bounced with a memo stating that “Account Closed”. Thereafter, the
respondent has caused notice under Section 138 of Negotiable
Instruments Act, dated 22.02.2013 calling upon the revision
petitioner/accused to pay the cheque amount and intimating about the
bouncing of the cheque. The statutory notice was received by the accused
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Crl.R.C.No.400 of 2020
on 28.02.2013, however, he has not sent any reply. Thereafter, the
complaint presented before the Fast Track Court, Erode was taken on file
and the same has been assigned S.T.C.No.331 of 2013.
4. The complainant has explained her source of money to lend
Rs.5,00,000/- to the accused, whereas the accused who had pleaded that
he had no financial transaction with the complainant and the transaction
was only with husband and son of the complainant not been proved even
by preponderance of probability. Therefore, the accused was held guilty
of offence under Section 138 of N.I.Act and the Trial Court sentenced
him to undergo one year S.I and to pay a fine of Rs.5,000/-, in default,
one month Simple Imprisonment.
5. Aggrieved by the judgment of the Trial Court, the accused
preferred an appeal before the I Additional District and Sessions Judge,
Erode. In the course of the appeal, he took out an application to adduce
additional evidence. The lower Appellate Court allowed the petition
filed under Section 391 Cr.P.C. The Auditor by name Subramanian was
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Crl.R.C.No.400 of 2020
examined as DW.3 and through him Ex.D1 to Ex.D3 were marked.
Relying upon these documents, the accused before the lower Appellate
Court contended that there was a business transaction existing between
him and the husband of the complainant. The two invoices marked as
Ex.D1 and Ex.D2 raised by Sri Chinnamman Wax Printers in the name of
Raja Tex, Karur, for a sum of Rs.1,45,000/- and Rs.2,98,480/-
respectively, which are dated 20.03.2008 and 27.03.2008, go to show that
there was a business transaction between him and the husband of the
complainant. Further, Ex.D3-the Statement of Account ending that
20.07.2008 indicating that there was a running account between the
Chinnamman Wax Printers and Raja Tex, Karur. It was contended that
the subject cheque was given as a security for the goods supplied on
credit by the husband of the complainant and not to the complainant to
discharge any debt he owe to her.
6. The lower Appellate Court, after appreciating the defence
taken by the appellant through the testimony of DW1 to DW.3 and the
Exhibits D1 to D3 negatived the defence on the ground that these facts
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Crl.R.C.No.400 of 2020
were not said when the legal notice Ex.P3 was issued. Further before the
Trial Court, the accused who has examined D1 and D2, had not spoken
about these invoice transactions. Furthermore, under Section 313 of
Cr.P.C., questioning the accused had not explained the circumstance
under which the subject cheque was issued. Therefore, the lower
Appellate Court has confirmed the judgment of the Trial Court by
dismissing the appeal vide judgment dated 31.10.2019.
7. The learned counsel for the revision petitioner/accused
submitted that the recent judgment of the Hon'ble Supreme Court
rendered in Rajaram Vs. Marudhachalam and the earlier Constitution
Bench judgment of the Hon'ble Supreme Court clearly laid down the law
that to draw presumption under Section 138 of N.I.Act. The complainant
has to prove the foundational fact such as source of money and the
alleged debt is legally enforceable. In this case, the complainant during
the cross examination has admitted that she is a house wife and she has
no business or source of income. She solely depends on her husband.
While so, the Trial Court as well as the Appellate Court ought not to have
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Crl.R.C.No.400 of 2020
drawn a presumption under Section 138 of N.I.Act. Further, the learned
counsel also submitted that the accused by examining DW.1 to DW.3 as
well as by making Ex.D1 to Ex.D3 has proved that there was an existing
business transaction between the company run by the husband of the
complainant and the firm run by the accused and in the course of the said
business transaction, the subject cheque was issued during the year 2007-
2008. Thereafter, the accounts has not been used and bank account also
closed. The said cheque, given as a security, has been misused by the the
complainant and presented the cheque for collection. That was the reason
why the cheque was returned with an endorsement “Account Closed”.
Therefore, he submits that the cheque was given merely for security
purpose in the business transaction and that will not attract the offence
under Section 138 of N.I.Act and for failure of the complainant to prove
the foundational fact, the judgment of the Trial Court as confirmed by the
lower Appellate Court has to be reversed.
8. Notice to the complainant not served and the learned counsel
for the revision petitioner submitted that the private notice sent by RPAD
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Crl.R.C.No.400 of 2020
received by the respondent as early as March 2020 and he received
information from the reliable source that the respondent/complainant has
passed away.
9. The submissions made by the learned counsel for the
revision petitioner and on perusal of the records as well as the judgment
cited as precedent by the Courts below. This Court proceed to determine
whether the subject cheque issued for any legally enforceable debt as
held by the Courts below.
10. The case of the complainant is that the cheque Ex.P1 was
issued to discharge the existing debt arose due to borrowing of the
money earlier by the accused. In the cross examination, the complainant
has said that the cheque was filled up by the accused and handed over to
her after receiving the money. The said transaction has taken place at the
residence of PW.1 in the presence of her husband and son.
11. Though in the cross examination, she has said that she has
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Crl.R.C.No.400 of 2020
no independent income on her own, later she has also clarified that
through agricultural and cattle rearing she has income and from out of
her saving she has given a hand loan of Rs.5,00,000/- to the accused.
Admittedly, the complainant is not a person of no means. Even according
to the complainant, her sons and husband are carrying on business and
the accused himself admits that he used to purchase materials from
complainant's husband on credit basis. His own statement of accounts
which is marked as Ex.D3 indicates that he used to purchase goods on
credit basis and pay it later.
12. According to Ex.D3 as on 27.03.2008, he owed a sum of
Rs.5,29,413.87 to Chinnamman Wax Printers for the material supplied to
the accused. It is contended by the learned counsel for the revision
petitioner that the cheque issued as security to Palanisamy, who is the
owner of Chinnamman Wax Printers, cannot be misused by presenting
the cheque in the name of his wife, who had no privity of contract and
no right to enforce any debt against the accused.
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Crl.R.C.No.400 of 2020
13. In this regard the judgment of the Hon'ble Supreme Court
which says that the complainant should prove the enforceable debt to
sustain a complaint under Section 138 of N.I.Act relied.
14. This is a peculiar case where the cheque, which is the
subject matter of the revision petition was written and signed by the
accused. The return memo Ex.P2 indicates that on the date when the
cheque drawn on Bank of India, Karur branch, the account already closed
the account. On receiving the return memo, the complainant has caused
notice Ex.P3 dated 22.02.2013 which was received by the accused on
28.02.2013. This fact is proved through the postal acknowledgment card
marked as Ex.P4. Before the Trial Court, through DW.1 and DW.2, the
accused able to establish the fact that the business transaction between
her husband and the accused. In the cross examination it is elucidated
from the complainant that her husband and sons are running business in
wax printing and they have business transaction with the accused. This
fact is no way rebut the presumption enumerated under Section 139 of
N.I.Act.
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Crl.R.C.No.400 of 2020
15. In the appeal to improve his defence, the accused has
summoned the Auditor Subramanian, who was examined as DW.3.
Through him, two invoices and the statement of account ledger extracted
from the statement of account has been marked. Examination of these
three documents, the factum of transaction between the accused and the
Chinnamman Wax Printers alone is proved. Further as per the statement
of accounts relied by the accused on 27.03.2008, he owe a sum of
Rs.5,29,413.87. There is no evidence to show that the said due was
cleared subsequently. Going back to the defence taken by the accused
that he gave the subject cheque as a security for the goods supplied on
credit basis and the same has been misused by filling up the name of his
wife, it is clear that there is existing debt payable by the accused.
Section 20 of N.I.Act reads as below:
“20. Inchoate stamped instruments:- Where
one person signs and delivers to another a
paper stamped in accordance with the law
relating to negotiable instruments then in force
in India, and either wholly blank or having
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Crl.R.C.No.400 of 2020
written thereon an incomplete negotiable
instrument, he thereby gives prima facie
authority to the holder thereof to make or
complete, as the case may be, upon it a
negotiable instrument, for any amount
specified therein and not exceeding the amount
covered by the stamp. The person so signing
shall be liable upon such instrument, in the
capacity in which he signed the same, to any
holder in due course for such amount:
Provided that no person other than a holder in
due course shall recover from the person
delivering the instrument any thing in excess of
the amount intended by him to be paid
thereunder”
16. Section 118 of the N.I.Act, says that there is a presumption
unless contrary proof in respect of consideration, date and time of
occurrence, the time of acceptance and the holder in due course. While
there is a statutory presumption regarding the consideration and the
holder in due course and substantially there is an admission on the part of
the accused that he has given a cheque as a security and its own
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document says that a sum of Rs. 5,29,413.87 is due and payable to the
husband of the complainant. The accused cannot take a plea that the said
cheque dated 22.01.2013 was given as a security for the transaction,
which took place four years ago.
17. As far as the source of income, the complainant in the cross
examination has indicated her source and also though she is an house
wife, her husband and son being the earning members, it cannot be ruled
out that she has no wherewithal to lend Rs.5,00,000/- to the accused.
Therefore, the citation relied upon by the learned counsel for the revision
petitioner that the subject cheque was given only as a security and the
complainant has no wherewithal to advance Rs.5,00,000/-, both factually
not proved even by preponderance of probability. While there is a
statutory presumption, mere denial or adducing evidence which does not
shake the foundational fact proved by the complainant, can be taken as a
probability. Therefore, this Court finds no error or perversity in the
findings of the Courts below to interfere with the exercise of the
revisional jurisdiction.
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Crl.R.C.No.400 of 2020
18. Hence this Criminal Revision Case is dismissed.
Consequently, the connected Criminal Miscellaneous Petitions are also
dismissed.
20.04.2023
Internet : Yes/No
Index: Yes/No
rpl
To
1.The I Additional District and Sessions Judge, Erode.
2.The Judicial Magistrate Fast Track No.II, Erode.
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Crl.R.C.No.400 of 2020
Dr.G.JAYACHANDRAN, J.
rpl
Crl.R.C.No.400 of 2020
20.04.2023
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