9911796707
TMI Blog2005 (12) TMI 601X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. The accused in discharge of the said liability issued three cheques bearing Nos. 037652 for Rs. 1.90 lakhs, 037653 for Rs. 1.10 lakhs and 057981 for Rs. 1.30 lakhs on 8-6-2000, 9-6-2000 and 9-6-2000 respectively drawn on Dena Bank, Bank Street Branch, Hyderabad and executed a bond dated 17-9-i998 and also two letters dated 17-9-1998 and one letter dated 15-4-1998 on the letter head of the accused company stating that the accused shall repay the same on demand. It is further alleged that the accused neither supplied the BEL components nor repaid the deposit money as promised by them. On approaching the accused several times for the repayment of deposit money, the accused instructed the complainant to deposit the above said three cheques for encashment and accordingly the complainant presented the three cheques issued by the accused to him for collection before the bank and the same were returned unpaid by the bank of the accused with reasons "exceeds arrangement" with cheque return memos dated 9-6-2000 and 20-6-2000. Thereafter the complainant got issued legal notice to the accused on 14-6-2000 intimating the dishonour of the cheques and calling upon them to pay the am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the United India Insurance Company Limited in respect of the claim made for the damage caused in the fire accident. They also filed remand case diary in F. R. R. No. 270 of 2001 on the file of Police Station, Koti, Hyderabad to show that the complainant had filed a report complaining cheating against the accused wherein the complainant categorically ad-mitted that he took the disputed cheques on the same day on which he lend the amount to the accused. They also filed orders of the High Court, which quashed the FIR in the said crime and certain medical prescriptions to show that A2 fell sick and he took treatment in Care Hospital. No oral evidence has been adduced on behalf of the accused. 6. Considering the evidence adduced on behalf of the prosecution and the statement of the accused and documents filed on behalf of the accused, the learned Magistrate found that the cheques in dispute were not issued on 8-6-2000 and 9-6-2000 and that the complainant took those two cheques i.e. one for Rs. 1,10,000/- and another for Rs. 1,90,000/-on 17-9-1998 itself without putting the date as a security for the amount lent on the same day and similarly the complainant took another cheque for Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accused, it is sufficient to make out a case under Section 138 of the Negotiable Instruments Act. The Court below failed to consider that A. 1 is the company, A2 is the Managing Director, A3 and A.4 are the Directors of the company being his wife and son respectively and that all the accused admitted their joint and several liability and ail of them were participating in the day to day affairs of the company. The Court below failed to note that the complainant discharged his burden that the cheques were issued in pursuance of the deposits made by him and the said cheques were dishonoured due to insufficient funds and therefore, the ingredients covered under Section 138 of the Negotiable Instruments Act were fully satisfied. The observation of the learned Magistrate that the cheques Ex. P. 1 to P. 3 were issued in 1998 is totally perverse and it is not made out by the accused. The observation of the learned magistrate that A3 and A4 are not connected with the transaction is totally incorrect. A3 is the wife of A2 and A4 is the son of A2 and they are participating in day -to-day activities of the company. The learned magistrate is totally wrong in coming to the conclusion that the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e formal evidence led by accused is not proper. (2) In I.C.D.S. Ltd. v. Beemna Shabeer and Anr. AIR 2002 SC 3014 : 2002 Cri LJ 3935 wherein the Apex Court held that the cheque issued by the guarantor cannot be said to have not been issued for the purpose of discharging any debt or liability and that even in respect of such cheques issued by the guarantor, complaint under Section 138 of the Negotiable Instruments Act is applicable in the event of dishonour of such cheque. (3) In Goa Plast (P) Ltd. v. Chico Ursula D'souza wherein it has been held that where debt or liability was legally enforceable, the relationship between the parties concerned was not at all a factor germane to the proceedings under Section 138 of the Act and that the Courts have to see whether the drawer had sufficient funds in his account on the date of signing and presentation of the cheque, writing of the said letter and the date on which stop payment instructions were issued. (4) In Bhaskaran Chandrasekharan v. Radhakrishnan 1998 Cri LJ 3228 wherein the Division Bench of the Kerala High Court held when a cheque is issued for valid consideration, with no dispute regarding the signature, amount and nam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bt. He further submitted that the accused never disputed about his liability to pay the amount borrowed from the complainant and that as there was a fire accident in the factory of the accused, he promised to discharge the debt amount borrowed from the complainant after the insurance claim is settled and further when the accused requested the complainant to return the title deeds relating to Ac. 6.00 of land to enable him to sell the said land and discharge the debt due to the complainant, the complainant refused to return the title deeds relating to that land and on the other hand he presented the cheques knowing fully well that there was no amount of the accused in the bank and then launched prosecution in order to put pressure on the accused for immediate repayment and that Section 138 of the Act is not applicable to the cases of this nature. The learned Counsel further contended that there is absolutely no evidence to show that A-3 and A-4 are incharge of day-to-day business and they actively participated in the affairs of A-1 Company and therefore the trial Court rightly held that A-3 and A-4 who have not signed in the cheques cannot be prosecuted under Section 138 of the Nego ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... him but the accused did not return the deposited amount and that after persuasion the accused issued three cheques one for Rs. 1,90,000/-, second for Rs. 1,10,000/- and third cheque for Rs. 1,30,000/- drawn on Dena Bank, Bank Street in his favour. He did not give the actual dates of issue of those cheques in the chief examination. During the course of cross-examination he denied the suggestion that he took three cheques on the dates on which he deposited the amounts with the accused without putting the dates on the cheques and that he put dates on the disputed cheques according to his choice and presented the same in the bank. The three cheques are bearing dates 8-6 2000, 9-6-2000 and 9-6-2000 and those dates were put by way of date seal in the date column of the cheques and above those date stamp the signature of the accused is found in all the three cheques. According to the accused the complainant took those cheques even before lending the amount without putting the date in the cheques and kept with him besides taking bond and also pledge of title deeds relating to Ac. 6.00 of land belonging to the accused. The version of PW-1 in his evidence is that he did not take three cheque ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 17-9-1998 reads as follows: I.D. Singaraiah, Managing Director of Andhra Semiconductors Pvt. Ltd. hereby pledge with Sri Laxminivas Agarwal, the landed documents of 6 acres of M/s. Singarayya Sugar Ltd. and R. C. book of Maruthi 800 Car No. APIR-2039. 13. From the reading of the above said letters Exs : P-14 and P-15 and bond Exs : P-16 it is crystal clear that the cheques Exs P-1 and P-2 were taken from the accused by the complainant for Rs. 1,10,000/- and Rs. 1,90,000/- on 17-9-1998 itself on the date on which Rs. 3 lakhs was paid by the complainant to the accused by way of two cheques one for Rs. 1,90,000/- and the other for Rs. 1,10,000/- and that those cheques were taken as security for refund of the deposit of the amount in the event of failure to supply BEL components, besides taking pledge of the documents relating to the land of Ac. 6.00 belonging to the accused. Simi larly, the cheque Ex: P-3 for Rs. 1,30,000/-was taken on 15-4-1999 on which date the complainant paid Rs. 1,30,000/- to the accused by way of cheque issued in favour of A-1 company. These three documents Exs : P-14 to P-16 exhibited by the complainant himself clearly belies his evidence that those ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were taken on the date on which the amounts were deposited by the complainant with the accused or subsequently and that when once the issuance of the cheque, the amount mentioned therein and the signature contained therein are not in dispute, the Court shall presume that the said cheques were issued towards discharge of legally enforceable debt or other liability, unless the contrary is proved and that in the instant case, the accused did not choose to adduce any evidence and he did not choose to get into the box to state on oath that the said cheques were not issued towards discharge of any legally enforceable debt or other liability and hence the accused are liable for punishment under Section 138 of the Negotiable Instruments Act. In support of his contention he relied upon the above cited decisions. Whereas the respondents accused relied upon the decision of this Court in Shri Taher N. Khambati's Case 1995 Cri LJ 560 (supra). The learned Counsel for the accused submitted that the facts of the decision of this Court reported in Shri Taher N. Khambati's case (supra) are exactly similar to the facts of this case and therefore the said decision is very much applicable to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edit to the payment already made and presented the cheque for encashment before the bank. In other words the case of the accused is that the said cheque was taken as surety from them on the very date of lending the amount and not towards the discharge of the debt already borrowed and therefore Section 138 of the Act has no application. On the question of fact, it is found that the said cheque was taken without putting the date on the same day on which date the amount was lent to the accused as a security for prompt repayment. The trial Court found that it is not valid cheque as enunciated under Section 138 of the Act. In that case this Court confirmed the order of acquittal passed by the learned Magistrate. This Court in paragraph 10 of that judgment observed as follows: Section 138 of the Act is introduced with a view to avoid the malignant trade practice of indiscriminately issuing cheques without sufficient funds. The amendment is introduced with a view to curb instances of issuing such cheques indiscriminately. So, having regard to the purpose with which this provision is introduced, it is doubtful " whether a case of this nature can be construed as attracting the provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the date on which the cheques in dispute were taken from the accused. Therefore, the proved facts of the cited case are similar to the proved facts in the instant case. There is no material to show that the decision in Shri Taher N. Khambati's case 1995 Cri LJ 560 (supra) has been overruled by any subsequent decision of this Court or by the Apex Court. I am in entire agreement with the view expressed by the learned Judge of this Court in the cited case. Section 138 of the Act is being misused by the money lenders. This is one of such instances. Admittedly, the complainant herein took pledge of title deeds relating to Ac 6.00 of land belonging to the accused. It is also not disputed that there was fire accident in the factory of the accused and the entire property of the accused was damaged and the accused made claim before thee Insurance Company. It is also not disputed that the accused herein gave reply stating about their financial condition and also promising to repay the same after the insurance claim is settled by the Insurance Company. It is the further case of the accused that though the accused demanded return of the title deeds of the land to enable them to sell th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt circumstances. Here in the instant case, the documents filed by the complainant himself under Exs. P.14 and P-15 disclose that by the date of taking of the cheques Exs. P-1 to P-3 from the accused, there was no debt or liability incurred by the accused towards the. complainant. Therefore, the said letters themselves is sufficient to prove the contra to rebut the presumption available under Section 139 of the Negotiable Instruments Act. Further the accused during his examination under Section 313, Cr. P.C. filed documents along with his written statement to show that the cheques in question were taken as security for the amount lent by the complainant to the accused. Hence it cannot be said that the accused failed Lo prove contra to rebut the presumption available to the complainant under Section 139 of the Act. The decision of this Court in Shri Taher Khambati's case (supra) is very much applicable to the facts of this case. 17. The decisions of the Apex Court relied on by the complainant are not applicable to the facts of this case as the facts of the cited cases are different from the facts of this instant case, In fact, in C.D.S. Ltd.'s case 2002 Cri LJ 3935 (supra) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or any debt or liability. Then the complainant approached the Apex Court and the Apex Court held that the High Court erroneously proceeded on the basis that the burden of proving consideration for a dishonoured cheque is on the complainant and that the High Court lost sight of Sections 118 and 139 of the Act and that the burden of proving that a cheque had not been issued for debt or liability is on the accused. The Apex Court further observed that however the said presumption is rebuttal presumption. Even Section 139 of the Act also clearly shows that the presumption is a rebuttal presumption. Here in the instant case, the accused proved contra from the documents filed by the complainant himself that by the date of issuance of the cheque there was no existing debt or liability and that those cheques were taken as security for future liability. Therefore, this decision also does not come to the aid of the complainant in this case. 19. The other decision of the Apex Court in Goa Plast (P) Ltd.'s case 2004 Cri LJ 664 (supra) is not at all applicable to the facts of this case as the facts therein are entirely different from the facts of the instant case. In that case the accused ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transactions in connection with toddy shops. It was further contended by the defendants therein that the plaintiff inserted the date on the cheque without obtaining his consent and therefore it amounts to material alteration within the meaning of Section 87 of the Negotiable Instruments Act and it is void. On such facts, the Division Bench of Kerala High Court considered the Sections 87 and 118(b) of the Negotiable Instruments Act and Section 114 of the Indian Evidence Act and held as follows: When a cheque is issued for valid consideration, with no dispute regarding signature, amount and name, it cannot be said that putting a date on the cheque by the payee who is the holder of the cheque in due courses would amount to material alteration rendering the instrument void. In fact, there is no material alteration. When a cheque is admittedly issued with blank date, and when the payee has no objection with regard to the name, amount and signature, it can be presumed that there is an implied consent for putting the date as and when required by the beneficiary, and get it encashed. In other words, when the date is put by the payee, or the drawer on the cheque the presumptions under Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
