Chandrashekharayya Puttayya Hiremath vs Suresh Siddangouda Hosagoudar

Leave granted.

Challenging the conviction under Section 138 of the Negotiable Instruments Act and the sentence of imprisonment of six months imposed upon the appellant and the levy of fine of Rs.48,000/-(Rupees forty eight thousand) the appellant has filed this appeal.

Case of the respondent-complainant is that on 16.06.2005, on the request of the appellant-accused, he gave loan of Rs.24,000/-to the appellant-accused. In order to repay the said amount, the appellant has issued a cheque bearing No. 679021 dated 01.12.2005 for Rs.24,000/- to the respondent/complainant. When the same cheque was presented for encahsment on 09.01.2006, it was returned with the endorsement "Insufficient Funds". The respondent/complainant issued legal notice on 23.01.2006. After issuing legal notice on 23.01.2006, the respondent/complainant filed the complaint against the appellant under Section 138 of the N.I. Act.

In the Trial Court, the appellant has raised the defence that the cheque produced by the respondent-complainant was lost and in this regard an intimation was also sent to the bank. To substantiate the defence, the appellant has produced Exhibit D-1 and communication to the bank (Exhibit D-2). The Trial Court did not accept the contention of the appellant and negatived the defence. The Trial Court held that if really the cheque was lost, the bank could have endorsed that the cheque was bounced for the reason on account of intimation of account holder; but the cheque was returned with endorsement "Insufficient Funds". With those findings, the Trial Court convicted the appellant-accused under Section 138 of the N.I. Act and sentenced him to undergo simple imprisonment for six months and imposed a fine of Rs. 48,000/-which is paid to the respondent-complainant as compensation.

Being aggrieved, the appellant has preferred the appeal before the Court of Sessions Judge (Fast Track) at Haveri. Learned Sessions Judge affirmed the conviction of the appellant and by the Judgment dated 20th July, 2011 dismissed the appeal filed by the appellant. In revision before the High Court, the High Court also held that the appellant did not produce evidence to prove his defence that the cheque was lost. Vide impugned judgment dated 28.01.2019, the High Court has dismissed the Revision affirming the conviction of the appellant-accused and the sentence of imprisonment imposed upon the appellant and also the fine amount. Being aggrieved, the appellant has preferred this appeal.

When the appeal came up for hearing on 22.07.2019, this Court directed the appellant to deposit Rs.25,000/- (Rupees twenty five thousand) to the credit of Additional Civil Judge (Jr. Division) and J.M.F.C. Haveri.

In spite of service of notice, the respondent-complainant has not entered appearance. The Supreme Court Legal Services Committee has nominated Mr.Gaurav Agrawal, Advocate to appear and argue the matter on behalf of the sole respondent.

We have heard learned counsel appearing on behalf of the appellant as well as Mr. Gaurav Agrawal, learned counsel who has been nominated through the Supreme Court Legal Services Committee and perused the impugned judgment and materials on record.

In compliance of the order of this Court, the appellant has deposited an amount of Rs. 25,000/- before the Trial Court.

Though the appellant-accused has taken defence plea that the cheque No. 679021 dated 01.12.2005 for Rs.24,000/- has been lost, it has been recorded by the Courts below that the appellant has not proved that the cheque has been lost. In view of the concurrent findings recorded by the Courts below, we are not inclined to interfere with the verdict of conviction. Insofar as the sentence of imprisonment and the quantum of fine imposed are concerned, in our view, the sentence of imprisonment of six months imposed upon the appellant appears to be harsh and the same is to be set aside. It is also noted that the cheque amount was only of Rs. 24,000/-. Considering that the cheque amount was a small amount and in the interest of justice, we deem it appropriate to reduce the fine amount from Rs.48,000/- to Rs.30,000/-.

The conviction of the appellant-accused under Section 138 of the N.I. Act is confirmed. However, the sentence of imprisonment of six months imposed upon the appellant is set aside and the fine amount of Rs. 48,000/- is reduced to Rs.30,000/-.

Four weeks' time is granted to the appellant to deposit the balance amount of Rs.5,000/- before the Trial Court. The Trial Court is directed to disburse entire amount of Rs.25,000 + Rs.5,000 to the respondent-complainant.

The impugned order is modified to that extent and the appeal is partly allowed.

The Registry is directed to communicate this order to the respondent-complainant.