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TMI Blog2023 (4) TMI 756X X X X Extracts X X X X X X X X Extracts X X X X ..... be imprisonment or there may be fine being twice the amount of cheque or both. In this case, the accused can be sentenced to fine of double the amount of cheque which comes, to Rs. 8,00,000/- out of that compensation can be paid to the Appellant. Appeal allowed. - CRIMINAL APPEAL NO.1158 OF 2004 - - - Dated:- 13-4-2023 - S. M. MODAK, J. For the Appellant : Mr. Subhash Jha i/b Law Global. For the Respondent No.1-State : Mr. N. B. Patil APP. For the Respondent : Ms. Ilsa Shaikh for Respondent No.2, Appointed Advocate JUDGMENT : 1. The only issue arisen in this Appeal is whether solitary transaction of lending money can be said to be money lending transaction within purview of the Bombay Money Lenders Act, 1946 because carrying on business of money lending without obtaining license amounts to offence under the provisions of section 32B of the Act. So also the provisions of section 10 of the said Act put fetters on the power of Court to pass decree in favour of money lender in any suit unless a money lender holds valid license. In other words, if money is lent without license as part of money lending business and if the cheque is issued towards di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... videncing lending of amount of Rs.4,00,000/-. (ii) Promissory note dated 24th July 2001, executed by accused in favour of Proprietor Arun Joshi. 6. In fact when cheque is issued and signature is admitted, presumption comes into picture that there is consideration for which the cheque is issued. Accused has not denied signature and issuance of cheque. In this case the complainant has not only relied upon the said presumption but supports it by way of above two documents. 7. Learned Advocate Ms. Ilsa Shaikh for Respondent No.2 with all her humility tried to support the order of the Appellate Court. She invited my attention to the agreement dated 24th July 2001, wherein there is reference of issuance of cheque in question as security. According to her, after the cheque is issued for guarantee, it is to be presumed that it is by way of security. 8. Appellate Court observed that cheque was issued not towards liability but by way of security. While doing that the Appellate Court relied upon the judgment in case of Pawan Enterprises Vs. Satish H. Varma 2003 All MR 756 . I have perused the judgment. In the said case, the cheque was issued towards repayment of balance amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bility is there, it falls within purview of section 138 of NI Act. Some time it happens that the cheque is issued for certain commitment to be performed in future, and if that transaction is cancelled, section 138 of NI Act does not get attracted. 12. In this case there was existing liability of Rs.4,00,000/- when cheque was issued. Mere reference, in the promissory note that it was issued by way of security does not make any difference. The purpose of executing promissory note is to seek a promise from the borrower to pay the amount. On that basis a summary suit for recovery of money can be filed. However, that remedy does not debar the lender/complainant to initiate action for the offence under section 138 of the NI Act. The agreement dated 24th July 2001, thereby evidencing advancement of loan does not require registration. The interest column of promissory note was blank. The authorised representative through Vinod Sharma was not instructed to send letter, (asking the accused to make payment otherwise the cheque will be deposited). All above facts does not affects liability. It was there at the time of issuance of cheque. Hence, I am of considered opinion that the first App ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fined in the Negotiable Instruments Act, 1881, other than a promissory note . Above provisions does not expects that there is continuous transaction of lending of money. However, it is interpreted by the Courts. So if money is advanced on the basis of Negotiable Instrument, it does not fall within meaning of word loan . There are three recognised kinds of negotiable instrument. They are Bill of Exchange, Promissory Note and cheque. So if the loan is advanced in the course of business of money lending and if cheque is issued towards repayment of loan, such loan does not come within purview of expression business of money lending . However, if the loan is advanced and promissory note is executed, primary requirement for invoking the provisions of the said Act is fulfilled. However, in this case there is promissory note and also a cheque is issued. Furthermore, if giving of loan is not a part of business of money lending, single instance will not fall within meaning of the expression loan . It has not come in evidence that the complainant is engaged in business of money lending continuously, if it is not there it was wrong on the part of the Appellate Court to treat the t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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