Haji J. Mohamed vs T.N. Krupananda

A.N. Venugopala Gowda

Petitioner, an accused in C.C. No. 116/2007, on the file of the JMFC at Hosanagar, has filed this criminal revision petition questioning his conviction and the sentence for the offence u/s 138 of N.I. Act. Sri. Dinesh Kumar, learned Advocate appearing for the petitioner, contended that the conviction of the petitioner by the trial Court and its affirmation by the appellate Court for the offence u/s 138 of N.I. Act is illegal. He submitted that though the ingredients of Section 138 of N.I. Act has not been met and despite the petitioner adducing evidence to rebut the presumption u/s 139 of N.I. Act, the judgment of conviction and the sentence imposed being illegal, warrants interference. Alternatively, he submitted that the sentence imposed is harsh. Learned Counsel submitted that the petitioner has deposited Rs. 75,000/- on 22.08.2011 and if the conviction were to be upheld, petitioner may be granted reasonable time to pay the balance fine amount.

Sri. K.A. Chandrashekara, learned Advocate appearing for the respondent, on the other hand, supported the impugned judgments and sought dismissal of the criminal revision petition. Learned Counsel opposed grant of time on the ground that the loan amount was borrowed on 10.04.2006 and more than six years has elapsed in between.

Both the courts below have appreciated the evidence lead by both the parties. The record shows that the parties are known to each other and that the petitioner borrowed Rs. 2,50,000/- on 10.04.2006 and issued post dated cheque - Ex. P-1 for repayment of the sum borrowed. The cheque, when presented, has been returned by the Bank as is evident from Exs.P-2 and P-3 with endorsement "payment stopped by drawer". Demand notice-Ex.P-4 was issued to pay the cheque amount and the postal acknowledgment is Ex. P-5. The cheque amount having not been paid, complaint was filed before the trial Court.

During trial, complainant has deposed as PW.1. The initial burden of proof was discharged by the complainant. Thus, the ingredients of the offence u/s 138 of the Act has been met by the complainant. In the circumstances, it is for the accused-petitioner to rebut the statutory presumption contemplated u/s 139 of the Act. Both the courts below have appreciated the defence evidence i.e., the deposition of the accused as DW.1 and the witness DW.2 and also Exs.D-1 to D-5.

In Goaplast Pvt. Ltd. Vs. Shri Chico Ursula D''Souza and Another, it has been held as follows:

Chapter XVII containing Sections 138 to 142 was introduced in the Act by Act 66 of 1988 with the object of inculcating faith in the efficacy of banking operations and giving credibility to negotiable instruments in business transactions. The said provisions were intended to discourage people from not honouring their commitments by way of payment through cheques. The court should lean in favour of an interpretation which serves the object of the statute. A post-dated cheque will lose its credibility and acceptability if its payment can be stopped routinely. The purpose of a post-dated cheque is to provide some accommodation to the drawer of the cheque. Therefore, it is all the more necessary that the drawer of the cheque should not be allowed to abuse the accommodation given to him by a creditor by way of acceptance of a post-dated cheque.

In view of Section 139, it has to be presumed that a cheque is issued in discharge of any debt or other liability. The presumption can be rebutted by adducing evidence and the burden of proof is on the person who wants to rebut the presumption. This presumption coupled with the object of Chapter XVII of the Act leads to the conclusion that by countermanding payment of post-dated cheque, a party should not be allowed to get away from the penal provision of Section 138 of the Act. A contrary view would render Section 138 a dead letter and will provide a handle to persons trying to avoid payment under legal obligations undertaken by them through their own acts which in other words can be said to be taking advantage of one''s own wrong.

In the case of Rangappa Vs. Sri Mohan, Apex Court has held that, the presumption mandated by Section 139 of the Act, does indeed include the existence of a legally enforceable debt or liability and to that extent, the observations made in the case of Krishna Janardhan Bhat Vs. Dattatraya G. Hegde, may not be correct. It has been held therein that, when an accused has to rebut the presumption u/s 139 of the Act, the standard of proof for doing so is that of "preponderance of probabilities."

The issuance of the cheque-Ex.P-1 is not in dispute. The return of Ex. P-1 on account of "stop payment instructions" is also not in dispute. The demand notice has been issued to pay the cheque amount. The petitioner has not been able to satisfy that there was sufficient amount in his account to honour Ex. P-1, on the date it was presented/received for payment. In the circumstances, the defence raised being not probable, the accused-petitioner has not rebutted the statutory presumption.

Both the courts below have concurrently found that the accused is guilty of the offence u/s 139 of the Act. There is no reason for me to take a view different from the one which has been taken by the courts below. Appreciation of evidence by the courts below is neither perverse nor illegal, warranting interference in exercise of revisional jurisdiction. Hence, the conviction of the petitioner for the offence u/s 138 of the Act by the trial court and its affirmation by the appellate Court is justified.

Cheque was issued for payment of the loan amount of Rs. 2,50,000/-, borrowed on 10.04.2006. Cheque was due for payment on 24.08.2006. Cheque, when presented, was returned on 28.11.2006. Demand notice was issued on 20.12.2006 to pay the cheque amount. The trial Court in the circumstances was justified in sentencing the accused to pay fine of Rs. 3,00,000/- and in default, to undergo simple imprisonment for a period of six months. Out of the fine amount, Rs. 2,99,000/- has been ordered to be paid to the complainant as compensation. The record shows that the petitioner was a merchant. In the circumstances, I do not find the fine amount imposed on the petitioner to be unreasonable or excessive. Petitioner has deposited Rs. 75,000/- on 22.08.2011. The complainant is entitled for release of the said sum towards the compensation amount ordered by the trial Court. The petitioner is granted time up to 31.01.2013, for payment/remittance of the balance fine amount of Rs. 2,25,000/-. If the balance fine amount is deposited or realised, Rs. 2,24,000/- therefrom be released in favour of the complainant.

The bail bonds shall stand cancelled if the balance fine amount is not deposited by the accused before 31.01.2013 and the accused shall surrender before the trial Court to serve the custodial sentence.

Petition stands disposed of accordingly.