Madras High Court
M.Durai vs R.Kalaiselvan on 23 October, 2025
Author: M.Nirmal Kumar
Bench: M.Nirmal Kumar
Crl.A.No.697 of 2016
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 23.10.2025
CORAM:
THE HON'BLE MR.JUSTICE M.NIRMAL KUMAR
Crl.A.No.697 of 2016
M.Durai ... Appellant/Complainant
Versus
R.Kalaiselvan ... Respondent/Accused
PRAYER : Criminal Appeal filed under Section 378 of Cr.P.C. praying to set
aside the judgment of acquittal of the accused made in S.T.C.No.351 of 2015
on the file of Judicial Magistrate, Fast Track Court No.I, Erode dated
11.01.2016 by allowing the above appeal.
For Appellant : Mr.S.Kaithamalai Kumaran
For Respondent : Mr.M.Karthick
for M/s.I.C.Vasudevan
JUDGMENT
The appellant as complainant had filed a private complaint against the
respondent for offence under Section 138 of the Negotiable Instruments Act
in S.T.C.No.351 of 2015. The trial Court, by a judgment dated 11.01.2016
dismissed the complaint, discharged the accused, against which, the
complainant had preferred the above appeal.
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2.The contention of the learned counsel for appellant is that the
appellant examined himself as PW1 and marked Exs.P1 to P4. Ex.P1 is the
cheque dated 20.01.2015, Ex.P2 is the Bank return memo dated 12.02.2015,
Ex.P3 is the statutory notice dated 18.02.2015 and Ex.P4 series is the Postal
Acknowledgement Card dated 19.02.2015. The respondent had taken a loan
from the appellant for a sum of Rs.1,00,000/- on 20.12.2014. In discharge of
the liability, the respondent issued the cheque/Ex.P1 dated 20.01.2015. Since
the appellant was in urgent need of money, he discount the cheque with the
financier, namely “Venkateswara & Co. Finance”, received the cheque
amount of Rs.1,00,000/- and within a short period, the appellant repaid the
amount of Rs.1,00,000/- and received back the cheque. But by oversight the
earlier endorsement was not cancelled. Thereafter the appellant/complainant
presented the said cheque for collection and the same was returned for the
reason 'Funds Insufficient'. Thereafter statutory notice issued. The respondent
after receipt of statutory notice/Ex.P3 neither paid the amount nor replied. It
is for the respondent to probabilise his defence once he admits his signature,
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in the cheque. In this case, the respondent not probabilised his defence but the
trial Court dismissed the complaint on technicality that the complainant is not
a holder in due course and M/s.Venkateswara & Co. not prosecuted the case
and there is no liability to the appellant/complainant. Hence, prayed for
setting aside the judgment of the trial Court.
3.The learned counsel for the respondent/accused submitted that as per
Section 9 and 50 of the N.I. Act, once a cheque was endorsed in favour of the
third party and the cheque amount was received by the drawer, thereafter it is
the person, who paid the amount, becomes holder in due course and he can
only initiate any proceedings under N.I. Act using Ex.P1/cheque. The
appellant after endorsement has got no right or authority to file the above
complaint. The trial Court found that as per Section 50 of the N.I. Act, the
complainant failed to receive back the cheque with proper endorsement,
hence as per Section 9 of the N.I. Act, the complainant is not a holder in due
course and rightly dismissed the complaint. Hence, prayed to dismiss the
appeal.
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4.Considering the submissions made on either side and on perusal of
the materials, it is not in dispute that cheque was made over to M/s.
Venkateswara & Co. with endorsement, which is admitted in the evidence.
Thereafter, as per Sections 9 and 50 of the N.I. Act, it is the holder in due
course to prosecute the respondent and not the appellant. The trial Court by a
well reasoned judgment had rightly acquitted the respondent. This Court
finds no reason to interfere with the well reasoned judgment of the trial
Court.
5. Hence, the Criminal Appeal stands dismissed.
23.10.2025
Index : Yes / No
Neutral citation : Yes / No
Internet : Yes/No
Speaking / Non-speaking order
rsi
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To
1.The Judicial Magistrate,
Fast Track Court No.I,
Erode.
2.The Public Prosecutor,
High Court, Madras.
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M.NIRMAL KUMAR, J.
rsi
23.10.2025
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