Vijayaraj vs Githeyon Raj and Another

R. Banumathi, J.—This appeal is directed against the order of acquittal in S. T. C. No. 2445 of 1991 of the learned Judicial Magistrate,

Pad-manabhapuram. By the judgment dated April 16, 1992, the first respondent/ accused was convicted of the charge u/s 138 of the Negotiable

Instruments Act, 1881.

Gist of the complaint : The accused borrowed a sum of Rs. 14,000 from the complainant on August 14, 1991, at Thakkalai, agreeing to repay

the entire amount on September 2, 1991. When the complainant demanded the amount on September 2, 1991, the accused issued exhibit A.1-

cheque, bearing No. 522748 of the State Bank of India, Kalkulam branch for Rs. 14,000. Exhibit A.1-cheque was presented for collection on the

same day i.e., on September 2, 1991. The cheque was returned unpaid for want of money with the endorsement ""funds insufficient"". On

September 9, 1991, the complainant issued exhibit A.3-notice to the accused. The same was received by the accused on September 24, 1991.

But the accused did not pay the amount. Hence, the complaint.

To substantiate the averments made in the complaint, in the trial court the complainant examined himself as P.W.1. Exhibits P.1 to P.5 were

marked. During the questioning u/s 313 of the Criminal Procedure Code, the accused denied his liability stating that a false case is foisted against

him. The first respondent/accused examined himself as D.W.1.

Defence version : The accused admits his signature in exhibits A.1-cheque along with the seal of Kothanallur Town Panchayat. The case of the

accused is that he affixed the seal in exhibit A.1-cheque as Panchayat President, Kothanallur. His tenure as president was over on March 2, 1991.

But exhibit A.1-cheque is dated September 2, 1991. According to the accused, the complainant was running a chit transaction. One Peer

Mohammed bid the chit from the complainant. The said Peer Mohammed had not complied with the payment schedule. On the complaint by the

complainant, Peer Mohammed was taken to police custody by Inspector of Police, Thakkalai. At that time, to get Peer Mohammed released, at

the request of Peer Mohammed and his friends, the accused had talks with the complainant Vijaya Raj. The complainant informed him that if the

accused gives cheque security, Peer Mohammed would be released. Accordingly, the accused issued exhibit A.1-cheque on September 2, 1990,

on condition not to present it for collection. On that condition, the accused issued exhibit A.1-cheque without date and without filling the drawee''s

name.

Upon consideration of the evidence, materials and the defence version and referring to the admission of the complainant that he filled the name

Vijaya Raj"" and the date in exhibit A.1-cheque, the learned magistrate acquitted the accused on the following findings :

(i) Exhibit 1-cheque was not issued on September 2, 1991 ;

(ii) Since in exhibit A.1-cheque, the seal of Kothanallur Panchayat President is affixed, presumably it must have been issued prior to March 2,

1991, since the office of the Panchayat President was dissolved prior to March 2, 1991 ;

(iii) That exhibit A.1-cheque is not supported by consideration.

Aggrieved over the order of acquittal, the complainant/appellant has preferred this appeal.

Originally, against the order of acquittal, a revision was filed as Crl. R. C. No. 342 of 1992, which was permitted to be treated as appeal by the

order of this court in Crl. M. P. No. 3199 of 1996 in Crl. R. C. No. 343 of 1992 dated October 4, 1996.

Assailing the findings, learned counsel for the appellant/complainant submitted that when the complainant was found to be the holder of the

cheque, the presumption arises that he is the holder in due course and the presumption against the accused arises u/s 139 of the Negotiable

Instruments Act. It is further submitted that the accused having issued the cheque, the burden is upon the accused to prove that the cheque was

issued only as security for the debt of Peer Mohammed and not to be encashed. Learned counsel for the appellant/complainant further contended

that even if the defence version is accepted, the accused cannot escape from Section 138 of the Act, since the cheque could be issued for

discharge of any debt or liability and reliance also placed upon a number of decisions in this regard.

Countering the arguments, learned counsel for the first respondent/accused submitted that when the office of the Panchayat President was

dissolved on March 2, 1991, the affixure of the seal of the Panchayat probablises the defence that the cheque was issued on September 2, 1990.

When there is a definite case of the accused that exhibit A.1-cheque was issued to discharge the debt of Peer Mohammed and the same was

suppressed by the complainant and when the complaint proceeds on the footing as if the complainant had advanced the amount to the accused,

who had issued the cheque, the trial court had rightly entertained the doubts regarding the issuance of exhibit A.1-cheque and rightly dismissed the

complaint and the findings do not suffer from any erroneous approach warranting interference.

Whether the approach and assessment of the evidence by the trial court suffers from any erroneous approach warranting interference in the

judgment of the acquittal ? is the only point that arises for consideration in this appeal.

Strict liability u/s 138 can be enforced only when the cheque is issued in the discharge of any legally enforceable debt or other liability, partly or

wholly. Where a cheque is issued not for the purpose of discharge of any debt or other liability, return of such cheque unpaid will not meet with the

penal consequences and the maker of the cheque shall not, therefore, be liable for prosecution. The Explanation to Section 138 provides that a

debt or liability under this section means only a legally enforceable debt or other liability. Therefore, it becomes obligatory on the complainant to

prove that there is a legally enforceable debt or liability. Let us consider whether any evidence is adduced to show that the accused was liable to

pay any amount and whether there is any enforceable debt ?

The main point for consideration is whether exhibit A.1-cheque is shown to have been issued in discharge of any subsisting liability or debt or

not. As per the averments of the complaint and exhibit A.3-notice, the definite case of the complainant is that the accused borrowed a sum of Rs.

14,000 from the complainant on August 14, 1991, agreeing to repay the entire amount on September 2, 1991. When the complainant demanded

the amount on September 2, 1991, the accused issued exhibit A.1-cheque. Nowhere in the complaint the purpose/nature of the loan advanced is

stated. It is not made clear whether it was a loan transaction or chit or business transaction. No account or other materials are produced

substantiating the claim. In fact, in exhibit A.1-cheque also the complainant stated that the accused had borrowed a sum of Rs. 14,000 agreeing to

repay the same on September 2, 1991.

In his evidence, P.W.1--the complainant has stated that on September 2, 1991, he went to the house of the accused and asked for money and

the accused issued exhibit A.1-cheque for the debt payable by him. In exhibit A.5-reply notice, the accused has clearly denied any debt payable

by him to the complainant. According to the accused, exhibit A.1-cheque was issued on September 2, 1990, without filling the date and the name

of the drawee. In exhibit A.5-reply notice, the accused has clearly set forth his defence. As pointed out by the trial court, the complainant has

conveniently omitted to produce the reply notice during his chief examination. Only in the cross-examination when he was questioned about the

reply notice, exhibit A.5 was produced in his re-examination. The conduct of the complainant in suppressing the reply notice and the concrete

defence set up by the accused are to be taken note of.

The accused was the Panchayat President of Kothanallur Panchayat. Admittedly, exhibit A.1-cheque was issued as a blank cheque. The

accused had signed in the same affixing the seal as Kothanallur Panchayat President. The tenure of the accused as Panchayat President was over

on March 2, 1991. In all reasonable probabilities, exhibit A.1-cheque must have been issued on September 2, 1990, as contended by the accused

or earlier to March 2, 1991. In the complaint filed on October 24, 1991, in the cause title the address of the accused has been stated as ""D.

Gideon Raj, S/o. Dason, Christian, Nadar, aged 35, Ex. Kothanalloor Town Panchayat President"", Thus, his tenure was over on March 2, 1991.

It is highly improbable that the accused would have issued exhibit A.1-cheque on September 2, 1991, with rubber stamp affixed. The trial court

was right in finding that exhibit A.1-cheque must have been issued prior to March 2, 1991 and it would be wrong and unreasonable to interfere

with that finding.

According to the accused, one Peer Mohammed bid the chit from the complainant. Since the said Peer Mohammed has not complied with the

payment schedule, on the complaint of the complainant, Peer Mohammed was taken into police custody. To get him released from the police

custody, at the request of Peer Mohammed and his friends, the accused had talks with the complainant. During the talks, as asked by the

complainant to get Peer Mohammed released, exhibit A.1-cheque was issued by the accused as security. The accused being the Panchayat

President, it is quite probable that he would have acceded to the request of Peer Mohammed and his friends and issued the blank cheque on

September 2, 1990, as a collateral safeguard for the amount payable by Peer Mohammed. Exhibit A.1-cheque was issued without filling the name

of the drawee and the date. Admittedly, the complainant himself had filled his name ""Vijaya Raj"" and the date ""September 2, 1991"". In that view of

the matter, the learned magistrate was right in finding that exhibit A.1 is unsupported by consideration. Learned counsel for the complainant relied

upon Satish Jayantilal Shah Vs. State of Gujarat, in support of his contention that entire body of the cheque need not be written by maker or

drawer and only the signature of drawer is material. This contention could be accepted only when the consideration is proved. In the instant case,

no evidence is adduced proving the consideration. While so, it cannot be contended that only the signature of the drawer is material. A legally

enforceable debt by the accused or the liability in existence is not proved. When exhibit A.1-cheque is not shown to have been issued in discharge

of any subsisting liability, the accused cannot be prosecuted for dishonour of the cheque.

Relying upon the cases of Bhaskaran Chandrasekharan Vs. V. Radhakrishnan, learned counsel for the appellant/complainant contended that

even if the defence version is accepted, the accused cannot escape from Section 138 of the Act. It is the further contention that the section deals

with a cheque drawn by a person for the discharge in whole or in part of any debt or liability. This means that the debt or other liability may be due

from any other person ; not necessarily due from the drawer. Learned counsel for the complainant submitted elaborate arguments contending that

the cheque issued as a collateral safeguard to release Peer Mohammed is a ""debt"" within the meaning of Section 138 of the Negotiable Instruments

Act and that the accused cannot escape from Section 138 of the Act. The finding of the trial court that exhibit A.1-cheque given in security for the

release of Peer Mohammed is not a debt, is assailed as erroneous.

The entire argument is advanced on the premise that exhibit A.1-cheque was issued as a security for the discharge of the debt of Peer

Mohammed. When the complainant has filed the complaint alleging that the accused had borrowed the amount agreeing to repay the same and the

cheque was issued for discharge of his own debt, the complainant cannot turn around and contend that the accused is to be held liable as the

security for the debt of Peer Mohammed. It is not open to the complainant to give up his own case and take advantage of the defence set forth. It

is not open to the complainant to insist upon the liability on exhibit A.1-cheque as the security for the discharge of the amount by Peer Mohammed.

Further no evidence is adduced showing the subsisting liability of Peer Mohammed and the debt payable by him. In his evidence, the accused has

stated that whenever he met the complainant, the complainant informed him that Peer Mohammed was paying the amount as per the payment

schedule. There is no material showing the subsisting liability of Peer Mohammed. Exhibit A.1-cheque is not shown to have been issued in

discharge of any subsisting liability or debt. The complainant himself had filled the date and name even when he was not authorised to do so.

Only when there are glaring infirmities and the findings suffer from serious and substantial error, the order of acquittal could be interfered with.

There is no erroneous approach in the assessment of evidence by the trial court. The reasonings and findings are well balanced in conformity with

the evidence on record. In the instant case, the findings of acquittal do not suffer from any serious or substantial error warranting interference. This

appeal has no merits and is bound to fail.

For the reasons stated above, this appeal is dismissed.