2013 (10) TMI 622 - HC - Companies Law

Dishonour of Cheque u/s 138 of the Negotiable Instrument Act Held that - The complainant had failed to prove his case and acquitted the accused - The complainant had failed to prove that the accused borrowed and issued cheque Ext.P1. On the other hand, the version of DW1 that while he had subscribed to a kuri conducted by Parur Kuries in which PW1 was the Manager, the accused had entrusted two blank signed cheques to him and he misused one of the same and created Ext.P1 - That being so, I find no merit in the appeal and the same was liable to be dismissed - The counsel for the appellant canvassed for a remand so that the appellant will get an opportunity to prove the transaction in dispute - After a lapse of so many years, I am not inclined to grant his request. Further, I have accepted the case of the accused regarding the issuance of a blank signed cheque - Therefore, the request of the counsel for the appellant for a remand was rejected.

Summary

Issues involved:
- Appeal against acquittal under section 138 of the Negotiable Instruments Act.
- Dispute over loan repayment and dishonored cheques.
- Evaluation of evidence and credibility of witnesses.
- Request for remand to prove the transaction.

Detailed Analysis:
1. The appellant filed a complaint under section 138 of the Negotiable Instruments Act against the accused for dishonoring two cheques issued to repay a loan. The lower court acquitted the accused, leading to the appeal challenging the judgment.

2. The appellant's case was based on the loan of Rs.10 lakhs given to the accused, who then issued two cheques that were dishonored. Despite notice, the amount was not repaid, leading to the legal action under section 138 of the Act.

3. The lower court recorded statements, examined witnesses, and considered evidence presented by both parties. The accused denied the transaction, presenting their defense through witnesses and cross-examination.

4. The lower court acquitted the accused after finding the appellant failed to prove the case. This decision prompted the appellant to appeal against the judgment, seeking a review of the evidence and legal interpretation.

5. During the appeal hearing, arguments were presented by the appellant's counsel and the respondents' counsel, focusing on the credibility of witnesses and the validity of the lower court's decision.

6. The appellant's testimony and evidence were countered by the accused's version, claiming the appellant misused a signed blank cheque, leading to the creation of the disputed cheque. The lower court accepted this defense, leading to the acquittal.

7. Additional evidence from a partner of the kuri company supported the accused's version, questioning the appellant's financial capacity to lend such a substantial amount. Ledger extracts and bank records further cast doubt on the appellant's claims.

8. The appellate court upheld the lower court's decision, emphasizing the failure of the appellant to substantiate the loan transaction and the acceptance of the accused's defense regarding the blank signed cheque.

9. The appellant's request for a remand to prove the transaction was rejected, considering the lapse of time and the acceptance of the accused's defense. The appeal was ultimately dismissed based on the findings and evidence presented during the proceedings.