Smt. Sheela @ Sheela Suresh vs K.C. Panchalaya @ Prem Kumar

V. Jagannathan, J.—These two Criminal Revision Petitions arise out of one and the same judgment of the lower appellate court which had while confirming the judgment of the trial court which had convicted the accused (Petitioner in Crl.R.P. No. 825/2010) and sentenced him to pay a fine of Rs. 1,50,000/- in respect of the offence u/s 138 of the Negotiable Instruments Act, modified the sentence by reducing the amount of fine to be paid by the accused to Rs. 1,00,000/- instead of Rs. 1,50,000/-.

The reduction of the fine amount by the lower appellate court has given rise to Crl.R.P. No. 168/2010 by the Petitioner, who was the original complainant before the trial court, and she has sought for restoration of the sentence imposed by the trial court. The other petition i.e., Crl.R.P. No. 825/2010 is filed by the accused and he has sought for setting aside the judgments of both, the courts below and to acquit hint.

The complainant before the trial court is Smt. Sheela @ Sheela Suresh and it was her case before the trial court that the accused had obtained a hand loan of Rs. 1,50,000/- from her during June 2002 and in that regard, both of them had entered a Memorandum of Understanding dated 29.5.2003, wherein the accused had agreed to repay the amount before the end of October 2003. It was also the case of the complainant that the accused had repaid only Rs. 25,000/- and for the balance amount, he issued two cheques - one for Rs. 50,000/- and the other one for Rs. 75,000/-, and these cheques were dated 25.3.2004 and 30.5.2004 respectively.

The said cheques, on presentation, were returned with the endorsement "insufficient funds" and this led the complainant to file the complaint u/s 138 of the N.I. Act in respect of the cheque for Rs. 50,000/-and the said case ended in conviction of the accused and even before the lower appellate court, the accused suffered an order and that case also reached the High Court and his conviction was confirmed.

As far as the present case is concerned, it is the case of the complainant that, in respect of the cheque for Rs. 75,000/- which had returned for insufficient funds, she issued a legal notice dated 16.6.2004 to the accused and following no response by the accused in respect of payment of Rs. 75,000/-, a complaint came to be lodged u/s 200 of the Code of Criminal Procedure alleging commission of the offence u/s 138 of the N.I. Act.

The trial court, after appearance of the parties and the accused pleading not guilty, allowed the parties to lead evidence and accordingly, on complainant''s behalf, she herself was examined as P.W.1 and nine documents were marked and, on behalf of the accused, he was examined as D.W.1 and Ex.D-1 legal notice Was marked in evidence. After appreciating the evidence on record and hearing the parties, the learned trial judge was of the view that the accused had committed the offence u/s 138 of the N.I. Act as he had issued the cheque Ex.P-1 to discharge the liability of Rs. 75,000/-and the said cheque had been returned for insufficient funds and, as such, the accused was convicted and sentenced to pay a fine of Rs. 1,50,000/- with default sentence to undergo S.I. for six months and, it was also ordered that if the fine amount is recovered, Rs. 1,35,000/- shall be paid to the complainant as compensation.

The accused appealed to the lower appellate court and his appeal was dismissed insofar as his conviction u/s 138 of the N I. Act is concerned. However, the lower appellate court modified the sentence of fine amount from Rs. 1,50,000/- to Rs. 1,00,000/- and out of the said amount, the complainant was ordered to be paid Rs. 95,000/-.

The complainant party-in-person, who is the Petitioner in Crl.R.P. No. 168/2010, referring to the judgments of the courts below, argued that both the courts have accepted her case and the documents produced at Ex.P-4, which is the legal notice, Ex.P-1 cheque and Ex.P-8 Memorandum of Understanding between the parties were all accepted by both the courts and apart from that, the courts have also taken into account the admission made by the accused in the course of his cross-examination as regards the loan being obtained by him and Ex.P-1 cheque was issued in that connection. Therefore, the courts below had no difficulty in accepting the case of the complainant and accordingly the trial court convicted the accused and the lower appellate court confirmed the same except for modifying the fine amount. It was therefore, submitted by the party-in-person that the lower appellate court could not have modified the sentence of fine and in this regard, reliance is placed by her on the decisions reported in Sathyan Vs. Yousu, , Pankajbhai Nagjibhai Patel Vs. The State of Gujarat and Another, and Goa Plast (P) Ltd. Vs. Chico Ursula D''Souza, .

On the other hand, the submission of the learned Counsel for the Respondent-accused, who is also the Petitioner in Crl.R.P. No. 825/2010, is that, the entire case of the complainant was in respect of one transaction and the legal notice was issued by the complainant as per Ex.P-4 gives an indication that the principal amount is Rs. 1,50,000/-, whereas the cheque Ex.P-1 is for Rs. 75,000/- and thus, there being not more than one transaction between the parties, the courts below failed to appreciate this aspect of the matter and in respect of Rs. 25,000/-, which amount had teen repaid by the accused, there being no dispute between the parties, the question of the accused being liable to pay Rs. 75,000/- does not arise, Moreover, in respect of the proceedings initiated as regards the cheque amount of Rs. 50,000/- is concerned, in the legal notice issued in that regard, no reference has been made to the cheque for Rs. 75,000/- and, therefore, the question of the accused being liable to pay Rs. 75,000/-under Ex.P-1 does not arise.

One other submission made by the learned Counsel for the Respondent-accused is that, Ex.P-8, which is said to be the Memorandum of Understanding, was obtained from the accused by the complainant under duress and it was executed before the Commissioner of Police and the said document also could not have been taken into consideration by the courts below. Moreover, the Memorandum of Understanding does not bear the signature of the parties on the first page. Under these circumstances, the question of the accused being liable for conviction u/s 138 of the N.I. Act does not arise and the view taken, by the courts below is liable to be set aside.

Having thus heard both sides, the first point that requires to be considered is whether the courts below were justified in convicting the accused for the offence punishable u/s 138 of the N.I. Act. Ex.P-4 is the legal notice issued by the complainant and the said document clearly mentions that the accused had borrowed. Rs. 1,50,000/- as hand loan in the year 2002, but paid only Rs. 25,000/- and in respect of the balance amount, the accused issued two cheques, one for Rs. 50,000/- and the other one for Rs. 75,000/-, in respect of the cheque for Rs. 50,000/-, it is not in dispute that the case ended in conviction of the accused and his conviction was also confirmed by the higher courts. We are therefore, concerned with the cheque for Rs. 75,000/-, which is the subject matter of the present petitions.

As far as the cheque Ex.P-1 for Rs. 75,000/- is concerned., the said cheque is produced in evidence and it is marked and the signature of the accused is not in dispute. As far as the amount being the loan amount is concerned, the complainant has produced Ex.P-8, which is the Memorandum of Understanding signed by the parties. The said document Ex.P-8 clearly mentions that the accused had borrowed Rs. 1,50,000/- and had agreed to repay the said amount before the end of October 2003. The said document also bears the signatures of both the accused and the complainant. The accused did not object to the marking of Ex.P-8 in the course of evidence.

As far as the liability on the part of the accused to pay the amount of Rs. 75,000/- as per Ex.P-1 is concerned, the courts below have taken note of the admission made by D.W. 1 in the course of his cross-examination. In his cross-examination, D.W.1 has clearly admitted that Ex.P-1, cheque was issued by him in respect of the loan amount. The appellate court has extracted the said admission made by D.W.1 at paragraph 13 of its judgment. Therefore, there is no difficulty in holding that. Ex.P-1 was issued by the accused to the complainant towards the amount due by the accused to the complainant.

As far as the principal amount mentioned in the legal notice Ex.P-4 in regard to which much was argued by the learned Counsel for the accused is concerned, no doubt, it is mentioned in the legal notice Ex.P-4 that the principal amount has to be paid by the accused, But, on going through the entire contents of Ex.P-4, one will have to draw the inference that the principal amount mentioned was in respect of Rs. 75,000/- which was the cheque issued by the accused to the complainant and which got dishonoured. Therefore, the said submission made by the learned Counsel for the accused does not appeal to me as convincing.

Thus, on a careful scrutiny of the judgments of the courts below and the evidence on record, I have no hesitation to hold that the courts below have rightly convicted the accused for the offence punishable u/s 138 of the N.I. Act.

Coming to the revision petition filed by the complainant as regards modification of the fine amount is concerned, the lower appellate court had modified the fine amount by reducing it from Rs. 1,50,000/- to Rs. 1,00,000/- and the reason given for reducing the said amount is that the transaction was of the year 2004 and five years have elapsed and if the amount of Rs. 75,000/- had teen kept in a bank, it would have fetched some interest and the complainant also incurred some legal expenses and to that extent only, the complainant can be compensated and not exorbitantly.

The aforesaid reasoning of the appellate court cannot be accepted in view of the legal position. This Court, in the case of Smt. Bhavani Vs. D.C. Doddarangaiah and Another, , has held that the amount of fine cannot be below the amount of the dishonoured cheque and the cost incurred by the drawee subject to limit of twice the amount of dishonoured cheque. The court went on to observe further that, where the amount of dishonoured cheque for Rs. 1,50,000/-, imposition of fine of Rs. 15,000/- on the drawer of the cheque does not reflect proper exercise of judicial discretion by the trial court and, therefore, the sentence of fine was enhanced to Rs. 3,00,000/-.

In the Instant case, the complainant, who is the party-in-person before this Court, had given hand loan to the accused in the year 2002 and now, more than eight years have elapsed. Even if the complainant had kept the amount of Rs. 75,000/- in fixed deposit, the said would have doubled during all these years. Therefore, the lower appellate court was not justified in modifying the fine amount imposed by the trial court and the reasoning given by the lower appellate court is contrary to the aforesaid decision of this Court. In other words, the fine amount imposed by the trial court needs to be restored.

For the aforesaid reasons, the criminal revision petition filed by the accused i.e., Crl.R.P. No. 825/2010, is dismissed and Crl.R.P. No. 168/2010 filed by the complainant stands allowed to the extent of the judgment of the lower appellate court, which had modified the sentence of the trial court, being set aside and the sentence imposed by the trial court being restored. The complainant party-in-person is entitled to be paid the amount, which is in deposit, by the trial court.