Hassankutty M vs State Of Kerala

A. Badharudeen, J.

This Revision Petition has been filed under Sections 397 and 401 of the Code of Criminal Procedure (hereinafter referred as 'Cr.P.C.', for short), by the revision petitioner, who is the sole accused in S.T. No.10/2018 on the file of the Judicial First Class Magistrate Court-II, Ottapalam, arraying the original complainant as the 2nd respondent and State of Kerala as the 1st respondent.

The revision petitioner impugns judgment in S.T.No.10/2018 dated 24.10.2019 on the file of the Judicial First Class Magistrate Court-II, Ottapalam and the judgment in Criminal Appeal No.308/2019 dated 31.12.2021 on the file of the Additional Sessions Judge-III, Palakkad arising therefrom.

Heard the learned counsel for the revision petitioner, learned counsel for the 2nd respondent as well as the learned Public Prosecutor.

I shall refer the parties in this revision as 'complainant' and 'accused' for easy reference.

The brief facts of the case put up by the complainant before the trial court are as under:

The complainant launched prosecution alleging commission of offence punishable under Section 138 of Negotiable Instruments Act (hereinafter referred as 'NI Act', for short), by the accused, when cheque for Rs.1,30,000/- dated 30.03.2016 alleged to be issued by the accused to the complainant to repay the said sum, which was originally borrowed on 01.03.2016, after executing a promissory note, got dishonoured for want sufficient funds, when it was presented for collection.

The  trial  court  proceeded  with  trial. During trial, PW1 was examined and Exts.P1 to P6 were marked on the side of the complainant.

On completion of prosecution evidence, the accused was questioned under Section 313(1)(b) of Cr.P.C. and provided opportunity to adduce defence evidence. Accordingly, DW1 was examined and Exts.D1 to D1(b) marked on the side of the accused.

The trial court appraised the evidence and finally found that the accused committed offence punishable under Section 138 of the NI Act and he was sentenced to pay fine of Rs.1,30,000/- (Rupees One Lakh Thirty Thousand Only). The fine was ordered to be given as compensation to the complainant under Section 357(3) of Cr.P.C. It was ordered further that in case of default in payment of fine, the accused would undergo simple imprisonment for a further period of one month.

The judgment in S.T.No.10/2018 dated 24.10.2019 was challenged before the Additional Sessions Court-III, Palakkad. The learned Sessions Judge also confirmed the said conviction and modified sentence as per judgment dated 31.12.2021 in Crl.Appeal No.308/2019, as under:

In the result, the appeal is allowed in part. The order of conviction passed by the trial Court is confirmed. The sentence is modified as imprisonment till rising of Court and to pay compensation of Rs.1,30,000/- to the complainant under S.357(3) Cr.P.C. In default of payment of compensation, the accused shall undergo Simple Imprisonment for 3 months. The appellant shall appear before the trial Court on 11.02.2022 to receive the sentence.

The concurrent verdicts entered into by the trial court as well as by the appellate court are under challenge in this revision petition.

In this case, the courts below relied on the evidence of PW1 and Exts.P1 to P6 hold that the complainant herein discharged his initial burden in the matter of transaction led to execution of Ext.P1 cheque.

When the matter is taken to appeal, the appellate court also appreciated the evidence and finally concurred the finding.

While assailing the concurrent verdicts of conviction as well as the sentence imposed by the trial court as well as the appellate court, the learned counsel for the revision petitioner raised a legal question. According to the learned counsel for the revision petitioner, in this matter, the specific case put up by the complainant before the trial court was that the accused borrowed Rs.1,30,000/- on 01.03.2016 by executing a promissory note. Thereafter, when the amount was demanded, Ext.P1 cheque was issued. Therefore, the primary duty of the complainant is to prove the execution of the promissory note and consequential issuance of Ext.P1 cheque. He argued that, if the complainant fails to prove the execution of the promissory note and the consideration for the said promissory note, it is not possible to uphold the case of the complainant that the cheque was issued towards payment of the amount covered by the promissory note.

The learned counsel given heavy reliance to a decision of this Court reported in Shaji v. Ignatious and Another [2009(1) KHC 740]. In the said decision, this Court while acquitting an accused in a prosecution launched alleging commission of offence punishable under Section 138 of NI Act, held as under:

Learned Magistrate and learned Sessions Judge unfortunately did not appreciate the evidence in the proper perspective and was carried away by the presumption provided under S.139, which could have been drawn only on establishing its execution. When the very execution of the cheque was not proved by the evidence of PW1, such presumption could not have been drawn. When it is alleged that Ext.P1 cheque was issued towards repayment of the amount due under a promissory note, without proving execution of the promissory note and the consideration for that promissory note it is not possible to uphold the case of the complainant that Ext.P1 cheque was issued towards payment of the amount covered by the promissory note. The case could have been upheld only on establishing that the amount covered by the promissory note was a legally recoverable debt. When the entire evidence is appreciated in the proper perspective cheque, it can only be held that the complainant did not establish that Ext.P1 cheque was issued towards payment of the legally recoverable debt due from the accused.

It is true that this contention was raised before the trial court and the trial court held that since the prosecution was launched on dishonour of Ext.P1 cheque, the complainant would get benefit of presumption under Section 139 of NI Act, since the accused admitted his signature in Ext.P1 cheque. In fact, the said contention not raised before the appellate court specifically.

To be on the crux of the matter, when the complainant alleges that the accused borrowed Rs.1,30,000/- for the complainant on 01.03.2016, on executing a promissory note, and Ext.P1 cheque was issued when the said amount was demanded, the contention of the accused was that he had borrowed a sum of Rs.10,000/- from the complainant during February, 2010 and during said transaction he had handed over blank signed cheques and stamp paper as security. Later in the year 2012, he borrowed an additional amount of Rs.15,000/-and during this transaction he had handed over blank signed documents.

The said case was suggested to PW1 during cross-examination and PW1 denied the same. PW1 also denied the repayment of the amount at the rate of Rs.3,700/- per month.

The contention taken in Ext.P6 reply notice was that when the cheque in question was handed over in the year 2010 or 2012 and the liability was only Rs.25,000/-. The further contention was that Rs.1,30,000/- was repaid within a period of two years and the liability was discharged. But no explanation given by the accused for keeping the security documents at the hands of the complainant even after discharge of liability as found by the appellate court.

The appellate court also negatived the contention raised by the accused, relying on the evidence of DW1, the Manager of Ottapalam Service Co-operative Bank Limited and Ext.D1 to prove that the cheque leaves bearing serial Nos.32891 to 32900, were issued during the year 2010 and the said account was opened at the instance of the complainant, the said contention also was found against. In this case, it is true that complainant put up the case that the accused borrowed Rs.1,30,000/-on 01.03.2016 on execution of a promissory note. When the amount was demanded, the present Ext.P1 cheque was issued. But the said promissory note was not produced before the court. According to PW1, the said promissory note was taken back, when Ext.P1 cheque wasissued.

Unlike in civil cases, in a prosecution alleging commission of offence punishable under Section 138 of NI Act, the complainant could very well avail twin presumptions provided under Sections 118 and 139 of the NI Act.

Law is settled in unequivocal terms that when the complainant discharged his initial burden in the matter of transaction led to execution of cheque, the complainant could very well avail the benefits of presumptions and it is the burden of the accused to rebut the presumptions. Supporting this view, the learned counsel for the complainant placed a decision of this Court in Sanil James v. State of Kerala and Another [2022(6) KHC 278].

In this matter, this Court is exercising power of revision and the power of revision is not available to appreciate or re-appreciate to have a contra-finding.

It is the settled law that power of revision available to this Court under Section 401 of Cr.P.C r/w Section 397 is not wide and exhaustive to re-appreciate the evidence to have a contra finding. In the decision reported in [(1999) 2 SCC 452 : 1999 SCC (Cri) 275], State of Kerala v. Puttumana Illath Jathavedan Namboodiri, the Apex Court, while considering the scope of the revisional jurisdiction of the High Court, laid down the following principles (SCC pp. 454-55, para 5):

“5. …... In its revisional jurisdiction, the High Court can call for and examine the record of any proceedings for the purpose of satisfying itself as to the correctness, legality or propriety of any finding, sentence or order. In other words, the jurisdiction is one of supervisory jurisdiction exercised by the High Court for correcting miscarriage of justice. But the said revisional power cannot be equated with the power of an appellate court nor can it be treated even as a second appellate jurisdiction. Ordinarily, therefore, it would not be appropriate for the High Court to reappreciate the evidence and come to its own conclusion on the same when the evidence has already been appreciated by the Magistrate as well as the Sessions Judge in appeal, unless any glaring feature is brought to the notice of the High Court which would otherwise tantamount to gross miscarriage of justice. On scrutinising the impugned judgment of the High Court from the aforesaid standpoint, we have no hesitation to come to the conclusion that the High Court exceeded its jurisdiction in interfering with the conviction of the respondent by reappreciating the oral evidence. ...”

In another decision reported in [(2015) 3 SCC 123 : (2015) 2 SCC (Cri) 19], Sanjaysinh Ramrao Chavan v. Dattatray Gulabrao Phalke, the Apex Court held that the High Court in exercise of revisional jurisdiction shall not interfere with the order of the Magistrate unless it is perverse or wholly unreasonable or there is non-consideration of any relevant material, the order cannot be set aside merely on the ground that another view is possible. Following has been laid down in para.14 (SCC p.135):

“14. …...  Unless  the  order  passed  by  the Magistrate is perverse or the view taken by the court is wholly unreasonable or there is non-consideration of any relevant material or there is palpable misreading of records, the Revisional Court is not justified in setting aside the order, merely because another view is possible. The Revisional Court is not meant to act as an appellate court. The whole purpose of the revisional jurisdiction is to preserve the power in the court to do justice in accordance with the principles of criminal jurisprudence. The revisional power of the court under Sections 397 to 401 Cr.P.C is not to be equated with that of an appeal. Unless the finding of the court, whose decision is sought to be revised, is shown to be perverse or untenable in law or is grossly erroneous or glaring unreasonable or where the decision is based on no material or where the material facts are wholly ignored or where the judicial discretion is exercised arbitrarily or capriciously, the courts may not interfere with decision in exercise of their revisional jurisdiction.”

The said ratio has been followed in a latest decision of the Supreme Court reported in [(2018) 8 SCC 165], Kishan Rao v. Shankargouda. Thus the law is clear on the point that the whole purpose of the revisional jurisdiction is to preserve power in the court to do justice in accordance with the principles of criminal jurisprudence and, therefore, it would not be appropriate for the High Court to re-appreciate the evidence and come to its own conclusion on the same when the evidence had already been appreciated by the Magistrate as well as the Sessions Judge in appeal, unless any glaring feature is brought to the notice of the court which would otherwise tantamount to gross miscarriage of justice. To put it otherwise, if there is non-consideration of any relevant materials, which would go to the root of the matter or any fundamental violation of the principle of law, then only the power of revision would be made available.

In this matter, the courts below given benefit of presumptions under Sections 118 and 139 of NI Act in favour of the complainant, on the finding that the evidence of PW1 in the matter of transaction led to execution of the cheque is believable.

Regarding law on presumptions, I would like to refer a 3 Bench decision of the Apex Court in [2010 (2) KLT 682 (SC)], Rangappa v. Sri Mohan. In the above decision, the Apex Court considered the presumption available to a complainant in a prosecution under Section 138 of the NI Act and held as under:

“The presumption mandated by S.139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat [2008 (1) KLT 425 (SC)] may not be correct. This is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant. S.139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While S.138 of the Act specified a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under S.139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by S.138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused/defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under S.139, the standard of proof for doing so is that of `preponderance of probabilities'. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. Accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own.”

In the decision reported in [2019 (1) KLT 598 (SC) : 2019 (1) KHC 774 : (2019) 4 SCC 197  :  2019  (1)  KLD  420  :  2019  (2)  KLJ  205  : AIR 2019 SC 2446 : 2019 CriLJ 3227], Bir Singh v. Mukesh Kumar, the Apex Court while dealing with a case where the accused has a contention that the cheque issued was a blank cheque, it was held as under:

“A meaningful reading of the provisions of the Negotiable Instruments Act including, in particular, Sections 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of S.138 would be attracted. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence.”

In a latest 3 Bench decision of the Apex Court reported in [2021 (2) KHC 517 : 2021 KHC OnLine 6063 : 2021 (1) KLD 527 : 2021 (2) SCALE  434  :  ILR  2021  (1)  Ker.  855  :  2021 (5) SCC  283  :  2021  (1)  KLT  OnLine  1132], Kalamani Tex (M/s.) & anr. v. P.Balasubramanian the Apex Court considered the amplitude of presumptions under Sections 118 and 139 of the NI Act it was held as under:

“Adverting to the case in hand, we find on a plain reading of its judgment that the Trial Court completely overlooked the provisions and failed to appreciate the statutory presumption drawn under S.118 and S.139 of NIA. The Statute mandates that once the signature(s) of an accused on the cheque/negotiable instrument are established, then these `reverse onus' clauses become operative. In such a situation, the obligation shifts upon the accused to discharge the presumption imposed upon him. Once the 2nd Appellant had admitted his signatures on the cheque and the Deed, the Trial Court ought to have presumed that the cheque was issued as consideration for a legally enforceable debt. The Trial Court fell in error when it called upon the Complainant-Respondent to explain the circumstances under which the appellants were liable to pay.

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Even if we take the arguments raised by the appellants at face value that only a blank cheque and signed blank stamp papers were given to the respondent, yet the statutory presumption cannot be obliterated. It is useful to cite Bir Singh v. Mukesh Kumar (2019 (1) KHC 774 : (2019) 4 SCC 197 : 2019 (1) KLD 420 : 2019 (1) KLT 598 : 2019 (2) KLJ 205 : AIR 2019 SC 2446 : 2019 CriLJ 3227], P.36., where this Court held that:

“Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under S.139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt.”

Thus the law is clear on the point that when the complainant discharges the initial burden to prove the transaction led to execution of the cheque, the presumption under Sections 118 and 139 of the NI Act would come into play. No doubt, these presumptions are rebuttable and it is the duty of the accused to rebut the presumptions and the standard of proof of rebuttal is nothing but preponderance of probabilities.

Since the proof in so far as the offence punishable under Section 138 of NI Act is concerned, the law is well settled as above. It is in this context, the ratio in Shaji's case (supra) required to be addressed. In the said case, this Court addressed proof regarding the cheque, which was issued towards payment of the amount due under in promissory note, without proving the execution of promissory note and the consideration for the promissory note. However, herein evidence of PW1 is specifically on the point that though the amount was borrowed after executing a promissory note, when the amount was demanded, cheque was issued after getting back the promissory note. If so, the evidence available would suggest proof of the transaction as contended by the complainant and, therefore, it could not be held, in the case on hand, that the complainant failed to prove the transaction which originated based on a promissory note, in any manner.

In this matter, the trial court as well as the appellate court correctly appreciated the evidence and came to the conclusion that the evidence available established commission of offence punishable under Section 138 of NI Act by the accused and, accordingly, the accused was convicted. In fact, there is no reason to revisit the concurrent verdicts of conviction or sentence.

In the result, this revision petition fails and is accordingly dismissed.

The   revision   petitioner/accused   is directed to appear before the trial court on 19.01.2023 to pay the compensation or to undergo default sentence. The execution of the sentence shall stand deferred till 18.01.2023.

On failure to do so, the trial court is directed to execute the sentence without fail.

Registry is directed to forward a copy of this order to the courts below concerned for information and compliance.