Sajal Guha vs Maniklal Ghosh

Indrajit Chatterjee, J.—I am hearing this appeal as against the judgment and order of acquittal as passed by the learned Judicial Magistrate, Baruipur, South 24 Parganas in Complaint Case No. 435 of 2006 disposed of by that Court on 22nd April, 2008 in which the learned Trial Court was pleased to acquit the present respondent in respect of the charge under Section 138 of Negotiable Instruments Act.

The case before the Trial Court for the purpose of appreciation of this appeal can be stated in brief thus:

"The complainant, the present appellant came up with a case before the Additional Chief Judicial Magistrate, Baruipur (transferred to the Trial Court) against the present respondent under Section 138 of the N.I. Act and disclosed in the complaint that on 19th July, 2005 the accused took Rs. 40,000/- from the complainant as loan and in discharge of his liability he repaid the said loan on 19th July, 2005 by issuing a post dated account payee cheque in favour of the complainant to the tune of Rs. 40,000/- being cheque No. 295461 dated 7th December, 2005 on Gorghara Branch, Allahabad Bank, District 24 Parganas (South) and at the same time the accused executed a document dated 19th July, 2005 admitting the said receipt of the amount and issuance of the aforesaid cheque the accused undertook to repay the said amount along with 2% interest per month on the principal amount and that on 8th April, 2006 when the cheque was presented by the complainant to his banker namely, United Bank of India on 19th April, 2006 the complainant was informed vide Bank Memo dated 11th April, 2006 that the cheque was dishonoured with the remark "insufficient fund". Thereafter, demand notice was issued by the complainant through his advocate by registered post with A/D asking him to repay the loan amount within the stipulated time. The said notice was received on 26th April, 2006 by the wife of the accused. But in spite of its receipt the accused did not pay any amount and as such the complaint was filed. The accused appeared in the case before the learned Trial Court when he was examined under Section 251 of the Cr. P.C. in respect of the charge under Section 138 of the N.I. Act to which the accused pleaded not guilty and claimed to be tried. Before the Trial Court on behalf of the complainant the complainant examined himself as P.W.1 and on behalf of the defence the defendant did not face the dock. The defence made out a case at the time of trial when he was examined under Section 313 of the Cr.P.C. and when P.W.1 being examined that he did not take Rs. 40,000/- from the complainant. But in fact he took Rs. 5000/- and for the said amount he was paying interest at the rate of 10% per annum and when he went to the complainant to demand Rs. 3000/- for admission of his daughter, the complainant asked him to issue a cheque 5 times of the said amount. The defence also made out a case that when the accused was ready to repay the amount the complainant asked him to give a fresh cheque and he did not give it out of fear."

Before the Trial Court affidavit-in-chief was marked as Exbt.1; cheque was marked as Exbt.2; bank memo was marked as Exbt.3; alleged chuktipatra written and signed by the present accused was marked as Exbt.4 and A/D along with postal receipt was marked as Exbt.5. The copy of the legal notice was also marked as Exbt.4 but it would have been marked as Exbt.6. On behalf of the defence no documentary evidence was adduced. After trial the learned Trial Court as I have told was pleased to acquit the accused on the ground that the complainant being one money-lender cannot get any protection under Section 138 of the N.I. Act.

At the time of hearing of the argument, it was submitted by the learned Advocate appearing on behalf of the appellant that all the ingredients of Section 138 of the N.I. Act was fulfilled through evidence both oral and documentary and, as such the order of acquittal be reversed and substantive sentence be imposed on the accused respondent including the amount of compensation under Section 357 of the Cr.P.C. to suitably compensate the appellant.

Regarding the law points Ms. Mitra cited the following decisions of this High Court:

"1. (2012)1 C Cr LR (Cal) 411 (Krishnendu Bandhapadhyay v. Kausik Das) wherein exercising revisional jurisdiction under Section 482 of the Cr. P.C. the learned Single Judge held that in the absence of production of any money-lending licence such plea cannot be taken and also cannot be answered in favour of the defence. It was further held by the Court that in the absence of any valid licence it cannot be held that the cheque in question was issued and discharge of any legally enforceable debt.

Samarendra Nath Das Vs. Supriyo Maitra, wherein also exercising the power granting under Section 482 of the Cr. P.C. the learned Single Judge held that there was no ground to dismiss the complaint at that stage and whether there was violation of the provisions of the Income Tax Act or Money-Lenders Act etc. will have to be considered by the learned Trial Court at the time of trial and the Court was pleased to dismiss that CRR.

One unreported decision of this Court in C.R.R. No. 1897 of 2015 (Gobinda Chandra Mondal v. Sajal Guha) wherein this Court did not dispose of the issue considering the fact that judgment before the Trial Court was to be delivered only on 17th October of 2015 and this Court I reiterate deliver the judgment on 13th September, 2015.

One unreported decision of this Court in C.R.R. No. 3002 of 2011 (Sri Subrata Sarkar and anr. v. Sajal Guha) wherein it was disposed of by this Court on 28th January, 2014 delivered by me wherein also it was not decided by this Court as to whether Section 138 of N.I. Act will not be applicable in a case where the money-lenders will come into play. In that C.R.R. it was only decided as regards the quantum of the compensation."

It was submitted by Mr. Jyotirmoy Adhikari, learned Advocate appearing on behalf of the respondent by taking me to Section 13 of the Bengal Money-Lenders Act, 1940 that no relief can be claimed by the present appellant in view of the bar under Section 13 of the said Act of 1940. He also took me to the evidence of P.W.1 at page 6 and 7 of the paper book which runs thus:

"At the time of the said transaction I was a money-lender........at that time I had licence to lend money. I took the cheque from the accused as security."

He also took me to the judgment of the learned Trial Court appearing at page 14 of the paper book to convince this Court that the learned Trial Court rightly came to the decision that it was not one enforceable debt and it was a loan transaction.

In reply, the learned Advocate appearing on behalf of the appellant submitted that the cheque was issued in discharge of liability and, as such, Section 138 of the N.I. Act will very much apply in the present case. She further submitted that the said money was not given out of the money-lending business of the complainant.

In this case, I am to decide whether the judgment of the Trial Court can be supported.

Let me start with Section 13 of the Bengal Money-Lenders Act, 1940 which runs thus:

"13. Stay of suit when money-lender does not hold licence.--(1) No Court shall pass a decree or order in favour of a money-lender in any suit instituted by a money-lender for the recovery of a loan advanced after the date notified under section 8 , or in any suit instituted by a money-lender for the enforcement of an agreement entered into or security taken, or for the recovery of any security given, in respect of such loan, unless the Court is satisfied that, at the time or times when the loan or any part thereof was advanced, the moneylender held an effective licence.

(2) If during the trial of a suit to which sub-section (1) applies, the Court finds that the money-lender did not hold such licence, the Court shall, before proceeding with the suit, require the money-lender to pay in the prescribed manner and within the period to be fixed by the Court such penalty as the Court thinks fit, not exceeding three times the amount of the licence fee specified in section 10 ."

Section 8 of the Money Lenders Act, 1940 is also relevant for decision of this case which runs thus:

"After such date not less than six months after the commencement of this Act as the State government shall, by notification in the Official Gazette, appoint in this behalf, no money lender shall carry on the business of money lending unless he holds an effective licence.

Explanation- An effective licence for the purposes of this Act comprises a licence issued to a person who is not disqualified for holding a licence."

The learned trial court acquitted the accused on the ground that the complainant was a money lender and he cannot get the advantage of Section 138 of the N.I. Act. There is a presumption in favour of the complainant under Section 139 of the N.I. Act but that presumption is restricted to the extent of drawing the cheque. The complainant will have to prove that the cheque was issued in discharge of existing liability.

Thus, this Court will have to consider whether

"(1) The cheque was issued in discharge of existing liability.

(2) Whether it remained unpaid.

(3) Whether the case is barred under the West Bengal Money Lenders Act, 1940."

The evidence of P.W.1 and documentary evidence that is their "Chukti Patra" (Ext. 1, though there is no such mark on the said ''Chukti Patra'' but in evidence it was marked as Ext. 1). Unfortunately, the Affidavit in Chief was marked as Ext. 1, and it was a mistake on the part of the learned trial court. This ''Chukti Patra'' will prove that the cheque was issued in discharge of existing liability. The accused while answering the questions under Section 313 Cr.P.C. contradicted his own statement and the statement he made out cannot be believed by this Court.

He deposed in his 313 examination that actually he received Rs. 5000/-(five thousand) as loan with the interest rate of 10 percent per annum and again he demanded Rs. 3000/-(three thousand) and that the present complainant appellant directed to ask him to write a cheque 5 times of that Rs. 3000/-(three thousand) to which he did not agree out of fear. He did not deny that the said ''Chukti Patra'' was not written by him and also did not deny that he did not issue the cheque or that the cheque was not filled in by him. Thus, he took a contradictory defence in his examination under Section 313 Cr.P.C.

It is a settled law that the holder of a cheque carries with him a presumption that the cheque was rightly issued. It is true that as per the decision of the Apex Court as reported in Krishna Janardhan Bhat Vs. Dattatraya G. Hegde, it was held that even though the holder of such cheque carries such presumptive value but it is the liability of the complainant to prove that the said cheque was issued in respect of one legally enforceable debt. If the evidence of P.W.1 is scrutinized vis-�-vis the documentary evidence mainly Ext. 1 that is ''Chukti Patra'' this Court can very well say that the said cheque was issued in favour of the present appellant in respect of one legally enforceable debt.

The question now is whether this case is barred under the provisions of the West Bengal Money Lenders Act, 1940. I have already quoted Sections 8 and 13 of the said Act to give the readers of this judgment about the intent of the legislature while enacting the said Act.

The money lending without licence is not totally barred or prohibited by the said Act. It is one regulatory Act and it regulates the business of money lending. Section 8 of the said Act says that after certain notification in the official gazette no money lender shall carry on the business of money lending unless he holds an effective licence. But the provision is not mandatory if one reads Section 13 of the said Act then he must say in the same tone with me that even if a money lender fail to file a money lending licence before the court while instituting the suit for recovery of a loan then filing of such suit is not barred. He was asked by the legislature to pay certain penalty and if such penalty is paid the suit instituted for recovery of money cannot be dismissed on the ground that the plaintiff had no money lending licence.

In the present case before this court P.W.1 claimed that he had money lending licence but could not produce the same. This is not a civil litigation and as such the rigors of Section 13 of the Money Lenders Act cannot be made applicable in this case. Thus, lending of money even without licence has not been specifically barred by the West Bengal Money Lenders Act and as such the payment made by the complainant to the respondent was perfectly valid by the said Act of 1940. If that be so the argument of the respondent that the complainant appellant had no legally enforceable debt as against the respondent cannot have any leg to stand on. The decision of the learned trial court on this point that there was no legally enforceable debt is not tenable and this Court respectfully differs with that view.

In this connection this Court likes to rely upon a Single Bench decision of this Court (unreported) passed in CRA No. 936 of 2013 (Jupiter Brokerage Services Ltd. v. Ektara Exports Pvt. Ltd. & Ors.) delivered on 13.10.2015.

Thus, on scrutiny of the record and hearing the argument advanced by the learned counsel of the parties this Court is of the view that the learned trial court erred in acquitting the present accused in respect of the charge punishable under Section 138 of the N.I. Act. The impugned order of acquittal passed in C. Case No. 435 of 2006 by the Judicial Magistrate, Baruipur, 24 Parganas (Sourth) is hereby set aside.

This being a summons case there is no reason to call the respondent to give answer to the proposed sentence to be imposed on him. The record shows that the cheque was issued on 07.12.2005 the amount of the cheque I repeat was Rs. 40,000/- (forty thousand). In the year 2005 the money value was much more compared to the present money value and as such the present appellant must be compensated adequately both for these as well as for mental and physical harassment.

The respondent is sentenced to suffer R.I for 10 days for the offence punishable under Section 138 of the N.I. Act and he is further sentenced to pay Rs. 80,000/-(eighty thousand) as compensation under Section 357 of the Cr.P.C, apart from this the complainant will get simple interest @ 9% per annum on and from 01.05.2006 till the payment of compensation is made in default in payment of this compensation amount and interest the respondent will have to undergo S.I for 6 months. It may be noted that the notice under the N.I. Act was received on 29.04.2006 by the respondent and as such period is fixed from 01.05.2006 for better calculation of interest.

The appeal is thus disposed of on contest without cost.

The department is directed to transmit the LCR to the learned trial court for taking necessary action. If the order of this Court as contemplated in this judgment is not carried out within 2 months from this day. Then the learned trial court will be at liberty to issue warrant of arrest against the present respondent without any further reference.

Certified copy of this judgment, if applied for, be supplied to the parties as per rules.