Shambhavi V. Shetty and Others vs Gulabi Narayana Poojary and Others

Budihal R.B., J.—Since these two petitions are filed against the judgment and order dated 08.02.2010 passed by I Addl. Sessions Judge D.K. Mangalore in Crl. A. No. 197/2008 and since common questions of law and facts are involved in both these petitions, they have been taken up together to avoid repetition of discussion and to dispose of them by common order.

Criminal Revision Petition No. 841/2010 is filed by the petitioner/complainant being aggrieved by the judgment and order of First Appellant Court, which has modified the judgment and order passed by the JMFC Court, Puttur.

Criminal Revision Petition No. 828/2011 is filed by the petitioner/accused being aggrieved by the judgment and order dated 08.02.2010 passed by I Addl. Sessions Judge D.K. Mangalore in Crl. A. No. 197/2008 and seeking to set-aside the judgment and order of conviction dated 02.05.2008 passed by the Addl. Civil Judge (Sr. Dn.) and J.M.F.C Puttur, D.K. in C.C. No. 1285/2006 for the offence punishable under Section 138 of Negotiable Instruments Act.

Brief facts of the case of the complainant are that Smt. Shambhavi V. Shetty, who is the petitioner in Crl. R.P. No. 841/2010, presented before the Trial Court that the accused Smt. Gulabi Narayana Poojary borrowed a sum of Rs. 2,00,000/- as hand loan for her necessities. When the complainant pressed for repayment, accused issued the cheque bearing No. 464207 dated 14.02.2006 drawn on Abhyudaya Cooperative Bank Ltd., C.B.D. Belapur Branch, Sector-6, Belapur, New Mumbai, for Rs. 2,00,000/- in favour of the complainant. The complainant accepted the cheque and presented the same for collection through her banker, The Syndicate Bank, Salethur Branch, Bantwal Taluk, D.K. District in Karnataka to collect the proceeds of the same from Abhyudaya Co-operative Bank Ltd., C.B.D. Belapur Branch, New Mumbai. However, the banker of the accused refused the payment on the above cheque issued by the accused and returned the same as per their memo dated 24.02.2006 for the reason ''funds insufficient''. The said fact was intimated to the complainant by her banker, the Syndicate Bank, Salethur Branch, Bantwal Takuk, D.K. District as per their memo dated 02.03.2006. The payment was refused by the banker as she had not arranged for sufficient funds to her credit in the account. Complainant got issued lawyers registered notice with acknowledgment dated 16.03.2006 to the accused demanding payment of the money and also intimating the accused of dishonoring the cheque issued by her and of the subsequent action, which would be taken against her, if she failed to comply with the demands made in the notice. The said notice was duly served on the accused on 23.3.2006. Thereafter, the accused neither chosen to settle the amount due nor replied to the said notice. Hence, the accused has committed an offence punishable under Section 138 of Negotiable Instruments Act.

After conclusion of trial of the case before the Trial Court and considering the oral and documentary evidence produced in the case, ultimately, the JMFC Court, Puttur convicted the accused for the offence under Section 138 of N.I. Act and sentenced to pay a fine of Rs. 2,05,000/- (Rupees Two lakh five thousand only) and in default of payment of fine she shall undergo simple imprisonment for one year and the amount so realized as a fine, out of which Rs. 2,00,000/- (Rupees Two Lakhs only) shall be paid to the complainant as a compensation.

Being aggrieved by the judgment of the trial Court, accused preferred an appeal before the First Appellate Court in Crl. A. No. 197/2008. The First Appellate Court allowed the appeal and modified the judgment and order of conviction and sentence dated 02.05.2008 passed by the Trial Court and sentenced to pay a fine of Rs. 20,000/- and in default of payment of fine amount, the accused shall undergo simple imprisonment for a period of three months and the fine amount as above stated to be paid to the complainant as a compensation.

Being aggrieved by the judgment of the appellate Court, the above two revision petitions are filed on the grounds as mentioned in the respective criminal revision petitions.

Heard the arguments of the learned counsel appearing for the revision petitioner/accused in Crl. R.P. No. 828/2011, who is the respondent in Crl. R.P. 841/2010 and learned counsel appearing for revision petitioner/complainant in Crl. R.P. 841/2010, who is the respondent in Crl. R.P. 828/2011.

It is the contention of the learned counsel for the petitioner/accused that the cheque was issued at Mumbai. The complainant is permanently residing at Mumbai and she is having her bank accounts at Mumbai. Hence, as the entire alleged transaction took place at Mumbai, the JMFC Court at Puttur is not having the territorial jurisdiction to entertain the complaint and to inquire into the matter. Hence, he has submitted that on this ground itself the judgment and order of conviction passed by the JMFC Court at Puttur is to be vitiated. He has also submitted that the complainant has not at all proved the case that the accused committed an offence under Section 138 of N.I. Act with cogent and acceptable materials. The Trial Court wrongly appreciated the materials and wrongly convicted the revision petitioner/accused for the said offence. Learned counsel has submitted that the First Appellate Court though came to the conclusion that the cheque is for an amount of Rs. 20,000/- (Rupees Twenty Thousand only) and subsequently, the figure has been changed to make it has Rs. 2,00,000, (Rupees Two lakh only), ought to have allowed the appeal in its entirety and ought to have set-aside the judgment and order of conviction passed by the trial Court. He has submitted that the judgment and orders passed by the both the Courts below are not in accordance with law. Hence, submitted that the revision petition filed by the petitioner/accused be allowed and the judgment and order of the Courts below be set-aside.

In support of his contention, learned counsel for the petitioner/accused has relied upon the following decisions reported in

"i. M.S. Narayana Menon @ Mani Vs. State of Kerala and Another, AIR 2006 SC 3366 : (2006) 3 BC 433 : (2006) 132 CompCas 450 : (2006) 6 CompLJ 39 : (2006) CriLJ 4607 : (2006) 3 CTC 730 : (2006) 6 JT 72 : (2006) 6 SCALE 393 : (2006) 6 SCC 39 : (2006) 3 SCR 124 Supp : (2006) AIRSCW 4652 : (2006) 5 Supreme 547

ii. John K. John Vs. Tom Varghese and Another, (2008) CriLJ 434 : (2007) 13 JT 222 : (2007) 11 SCR 287

iii. ILR 2009 KAR 1633 in the case of Kumar exports v. Sharma Carpets.

iv. Sri A. Viswanatha Pai Vs. Sri Vivekananda S. Bhat, (2009) ILR (Kar) 171 : (2009) 1 KCCR 508

v. Krishna Janardhan Bhat Vs. Dattatraya G. Hegde, AIR 2008 SC 1325 : (2008) CLT 337 : (2008) 141 CompCas 665 : (2008) CriLJ 1172 : (2008) 1 CTC 433 : (2008) 1 JT 485 : (2008) 1 SCALE 421 : (2008) 4 SCC 54 : (2008) AIRSCW 738 : (2008) 1 Supreme 306

vi. Dashrath Rupsingh Rathod Vs. State of Maharashtra, (2014) AIRSCW 4798 : (2014) 3 BC 513 : (2014) 9 SCALE 97 : (2014) 9 SCC 129

vii. Nishant Aggarwal Vs. Kailash Kumar Sharma, (2013) 8 AD 218 : AIR 2013 SC 2634 : (2013) 3 BC 391 : (2013) 3 CompLJ 264 : (2013) CriLJ 3771 : (2013) 3 JCC 158 : (2013) 9 JT 188 : (2013) 172 PLR 224 : (2013) 3 RCR(Civil) 685 : (2013) 3 RCR(Criminal) 697 : (2013) 7 SCALE 753 : (2013) 10 SCC 72

viii Sri. Ramkumar Vs. Beena Vijaya Kumar, (2014) 4 AKR 103 : (2014) ILR (Kar) 4171 : (2014) 6 KarLJ 586 : (2014) 3 KCCR 2399

Per contra, the learned counsel appearing for the petitioner/complainant in the connected petition has submitted that though the cheque was issued at Mumbai but the complainant presented the cheque at the Syndicate Bank, Salethur Branch, Bantwal Taluk, D.K. District. Hence, the JMFC Court at Puttur is having the jurisdiction to entertain the complaint and to grant the relief. He has further submitted that this contention was not raised before the trial Court as well as before the appeal Court, but for the first time such contention is raised before this Court in this petition, hence, same is not sustainable. He has also submitted that the trial Court rightly appreciated the oral and documentary evidence and rightly convicted the petitioner/accused by imposing fine of Rs. 2,05,000/-. But the appellate Court wrongly observed in its judgment and order that the figures in the cheque Ex. P-1 has been changed to Rs. 2,00,000/- from 20,000/- without any basis and wrongly modified the judgment and order of conviction passed by the Trial Court. Hence, the learned counsel has submitted that the judgment and order of the Appellate Court passed in Crl. A. 197/2008 be set-aside and judgment and order of conviction passed by the JMFC Court in C.C. No. 1285/2006 be restored.

In support of his contention learned counsel for the petitioner/complainant has relied upon the following decisions:

"i. K. Bhaskaran Vs. Sankaran Vaidhyan Balan and Another, AIR 1999 SC 3762 : (2005) 3 BC 158 : (2000) 99 CompCas 268 : (1999) CriLJ 4606 : (1999) 3 Crimes 212 : (1999) 3 CTC 358 : (1999) 7 JT 558 : (2000) 124 PLR 113 : (1999) 6 SCALE 272 : (1999) 7 SCC 510 : (1999) 3 SCR 271 Supp : (1999) 2 UJ 1529 : (1999) AIRSCW 3809 : (1999) 8 Supreme 608

ii. Rangappa Vs. Sri Mohan, AIR 2010 SC 1898 : (2010) 2 BC 693 : (2010) CriLJ 2871 : (2010) 5 JT 259 : (2010) 5 SCALE 340 : (2010) 11 SCC 441 : (2011) 1 SCC(Cri) 184 : (2010) 100 SCL 389 : (2010) AIRSCW 2946 : (2010) AIRSCW 6043 : (2011) AIRSCW 404 : (2010) 4 Supreme 169 : (2010) 5 Supreme 206

iii. Dashrath Rupsingh Rathod Vs. State of Maharashtra, (2014) AIRSCW 4798 : (2014) 3 BC 513 : (2014) 9 SCALE 97 : (2014) 9 SCC 129

iv. Escorts Limited Vs. Rama Mukherjee, (2013) 10 AD 37 : (2013) 4 BC 191 : (2013) 116 CLA 97 : (2013) 4 CompLJ 245 : (2013) 4 JCC 233 : (2014) 1 JT 322 : (2014) 1 PLR 249 : (2013) 4 RCR(Civil) 838 : (2013) 4 RCR(Criminal) 771 : (2013) 11 SCALE 487 : (2014) 2 SCC 255

v. Devendra Kishanlal Dagalia Vs. Dwarkesh Diamonds Pvt. Ltd. and Others, (2013) 12 AD 45 : AIR 2014 SC 655 : (2013) 4 BC 663 : (2013) 117 CLA 581 : (2014) 1 Crimes 86 : (2013) 6 CTC 780 : (2014) 1 JCC 20 : (2014) 1 JT 229 : (2014) 1 RCR(Civil) 222 : (2014) 1 RCR(Criminal) 158 : (2013) 14 SCALE 397 : (2014) 2 SCC 246 : (2014) 3 SCJ 174

vi. Harman Electronics (P) Ltd. and Another Vs. National Panasonic India Ltd., (2009) 2 AD 21 : AIR 2009 SC 1168 : (2009) 1 CompLJ 29 : (2009) CriLJ 1109 : (2008) 13 JT 671 : (2009) 153 PLR 525 : (2008) 16 SCALE 317 : (2009) 1 SCC 720 : (2009) AIRSCW 410

vii. 2014 (2) DCR 666 of Allahabad High Court in the case of Goyal Enterprises v. State of U.P. and another."

I have perused the grounds urged in the revision petitions, judgment and order passed by the Trial Court and the judgment and order passed by the I Addl. Sessions Judge, D.K. Mangalore and also perused the original records secured from the Trial Court, oral and documentary evidence produced before the Trial Court and also the decisions relied upon by the learned counsel on both sides, which are referred above.

The Trial Court found that the petition filed by the petitioner in Crl. R.P. No. 828/2011 before this Court, who was the accused in Trial Court was guilty for the offence punishable under Section 138 of Negotiable Instruments Act and she was sentenced to pay a fine of Rs. 2,05,000/- (Rupees Two Lakh Five Thousand only) and in default of payment of fine, she shall undergo Simple Imprisonment for one year and the amount so realized as a fine, out of which Rs. 2,00,000/- (Rupees Two Lakh only) shall be paid to the complainant, who is the petitioner in Crl. R.P. 841/2011. When the accused preferred the appeal before the I Addl. Sessions Court, D.K. Manglaore, the appeal was allowed and the First Appellate Court modified the judgment and order of conviction and sentence of the Trial Court and sentenced to pay a fine of Rs. 20,000/- and in default of payment of said fine amount, the accused shall undergo Simple imprisonment for a period of three months and the fine amount stated to be paid to the complainant as a compensation.

Perusing the judgment and order of the Trial Court, the Trial Court correctly assessed the oral and documentary evidence and convicted the accused for the offence punishable under Section 138 of Negotiable Instruments Act for the cheque amount of Rs. 2,00,000/- said to have been borrowed by the accused from the complainant.

But the appeal Court considered the defence taken by the accused that she borrowed an amount of Rs. 15,000/- from the husband of the complainant and not from the complainant and she gave the blank cheque till the repayment of the said amount. Subsequently, though she repaid the entire amount of Rs. 15,000/- to the husband of the complainant and asked for return of the cheque, the husband of the complainant postponed on the ground that it was not traced and he will return it after tracing it. Even thereafter, the accused asked the husband of the complainant to return the cheque, but inspite of that he did not return the said cheque and filling the cheque for an amount of Rs. 2,00,000/-, false case has been filed by the complainant before the Trial Court.

The accused admitted the signature on the cheque Ex. P-1. But it is her only contention that it was a blank cheque and gave as security for the repayment of Rs. 15,000/-. Taking such contention in the pleadings itself is not sufficient but it has to be proved with cogent and satisfactory material. Firstly, the accused has to explain that though she borrowed a sum of Rs. 15,000/- from the husband of the complainant, why she has given the cheque in the name of the complainant. Even though it is her contention that she has repaid Rs. 15,000/- to the husband of the complainant, even for this also she has not produced any material before the Court to show that she has paid the amount of Rs. 15,000/- to the husband of the complainant. When she repaid the amount of Rs. 15,000/- to the husband of the complainant and when he has not returned the cheque, why she has not taken any action against the husband of the complainant by issuing the legal notice or atleast by lodging the compliant before the Police that the cheque has not been returned. The First Appellate Court has ignored all these factual aspects and when the accused admitted her signature on the instrument Ex. P-1, even though it is said to be a blank cheque as submitted by the accused, but the initial presumption will arise under Section 118(a) and Section 139 of Negotiable Instruments Act, in favour of the complainant that the instrument is for consideration and it is for discharge of existing debt. So the burden is on the accused to rebut the said presumption.

But looking to the materials on record both oral and documentary, the accused has not produced any such cogent and satisfactory material to prove her contention that she has borrowed only a sum of Rs. 15,000/- from the husband of the complainant and she has already discharged the loan and inspite of these things her cheque was not returned to her. This legal aspect is also not properly appreciated by the learned I Addl. Sessions Judge, D.K. Mangalore and without there being any evidence, the appellate Court accepted the explanation of the accused, which she has taken before the Trial Court. Therefore, the judgment and order of the First Appellate Court is not in accordance with law and also not in accordance with the evidence placed on record i.e., both oral and documentary.

With regard to another contention raised by the revision petitioner/accused in Crl. R.P. No. 828/2011 that the transaction took place at Mumbai, cheque was issued at Mumbai and it was drawn on the drawee bank, which is situated at Mumbai, complainant was also having the account at Mumbai, hence, the Court at Puttur was not having the territorial jurisdiction to entertain the compliant and to grant the relief is concerned, though such contention was not raised before the Trial Court as well as the appellate Court i.e., before the First Addl. Sessions Judge, D.K. Mangalore, but since it is a question of law, the revision petitioner/accused can raise such contention even before this Court.

Perusing the materials on record, it was the contention of the complainant that her native place is Salethur and since the complainant is having the account in the Syndicate Bank, Salethur Branch, Bantwal Taluk, D.K. Mangalore. She presented the said cheque for encashment in the said bank but ultimately when it was sent for collection, same was dishonoured by the Abhyudaya Co-operative Bank Ltd., C.B.D. Belapur Branch, Belapur, New Mumbai, and in this connection complainant produced Ex. P2 to show the dishonoured cheque by the drawee bank and Ex. P-3 is an endorsement issued by the Syndicate Bank, Salethur Branch, Bantwal Taluk, D.K. Mangalore, informing the dishonor of the cheque and subsequently, the notice was issued by the advocate for complainant, Puttur Taluk, D.K. Karnataka.

Looking to these materials, it was not only legal notice issued by the learned counsel as per Ex. P-4 from the place coming within the jurisdiction of Puttur Magistrate Court, but it was the case of the complainant that the cheque was also presented for encashment in the Syndicate Bank, Salethur Branch, Bantwal Taluk in D.K. District, Karnataka.

I have also perused the decisions relied upon by the learned counsel on both sides. Regarding the territorial jurisdiction of the Court for filing the complaint for the offence punishable under Section 138 of Negotiable Instruments Act, the Hon''ble Apex Court in the decision reported in Dashrath Rupsingh Rathod Vs. State of Maharashtra, (2014) AIRSCW 4798 : (2014) 3 BC 513 : (2014) 9 SCALE 97 : (2014) 9 SCC 129 . made it clear that in case of dishonor of cheque, the territorial jurisdiction is the place where the cheque has been returned by drawee bank alone constitutes commission of offence and hence, situs or venue of trial thus restricted to place where drawee bank is located. It is further made clear by the Hon''ble Supreme Court that place of issuance or delivery of statutory notice or where the complainant present the cheque for encashment not relevant for purpose of territorial jurisdiction of complaints. But regarding the application of this decision Their Lordships have observed in para 20 of the said judgment as under:

"20. We are quite alive to the magnitude of the impact that the present decision shall have to possibly lakhs of cases pending in various Courts spanning across the country. One approach could be to declare that this judgment will have only prospective pertinence i.e., applicability to complaints that may be filed after this pronouncement. However, keeping in perspective the hardship that this will continue to bear on alleged accused/respondents who may have to travel long distances in conducting the defence, and also mindful of the legal implications of proceedings being permitted to continue in a Court devoid of jurisdiction, this recourse in entirety does not commend itself to us. Consequent on considerable consideration we think it expedient to direct that only those cases where, post the summoning and appearance of the alleged accused, the recording of evidence has commenced as envisaged in Section 145(2) of the Negotiable Instruments Act, 1881, will proceeding continue at that place. To clarify, regardless of whether evidence has been led before the Magistrate at the pre-summoning stage, either by affidavit or by oral statement, the complaint will be maintainable only at the place where the cheque stands dishonoured. To obviate and eradicate any legal complications, the category of complaint cases where proceedings have gone to the stage of Section 145(2) or beyond shall be deemed to have been transferred by us from the Court ordinarily possessing territorial jurisdiction, as now clarified, to the Court where it is those where the accused/respondent has not been properly served) shall be returned to the complainant for filing in the proper Court in consonance with our exposition of the law. If such complaints are filed/refiled within thirty days of their return, they shall be deemed to have been filed within the time prescribed by law, unless the initial or prior filing was itself time barred."

But, here in the case on hand, the case was not at all pending before the Trial Court as on the date of said judgment of the Hon''ble Apex Court. The case was disposed of by the Trial Court by its judgment and order dated 02.05.2008 and the judgment of the appeal Court is dated 08.02.2010 i.e., four years earlier to pronouncement of the above said judgment from the Hon''ble Apex Court. Therefore, as the trial of the case was not pending before the concerned Magistrate Court on the date of judgment of the Hon''ble Apex Court, the case of the complainant is not affected and it is not permissible for the revision petitioner/accused in Crl. R.P No. 828/2011 to contend that as the concerned Magistrate Court was not having the territorial jurisdiction and hence, the said judgment and order of the Trial Court is liable to be set-aside.

Therefore, in view of the above discussion and legal position, the contention of the revision petitioner/accused that there is no territorial jurisdiction and hence, the complaint is liable to be dismissed only on that ground, cannot be accepted.

Accordingly, Crl. R.P. No. 841/2010 is allowed and Crl. R.P. No. 828/2011 is dismissed. The judgment and order dated 08.02.2010 passed by the I Addl. Session Judge, D.K. Mangalore in Crl. A. No. 197/2008 is set-aside and the judgment and order dated 02.05.2008 passed by the Addl. Civil Judge (Senior Division) and JMFC, Puttur, D.K. in C.C. No. 1285/2006 is hereby confirmed.