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2005 DIGILAW 1663 (BOM)

Kollu Prasada Rao v. Burra Krishnaiah

2005-12-07

T.CH.SURYA RAO

body2005
JUDGMENT:- The appellant seeks to assail the order of acquittal dated 1-12-2000 passed by the learned I Additional Judicial Magistrate of First Class, Khammam, in C.C. No.554 of 1998. 2. The complainant who filed the complaint under Section 138 of the Negotiable Instruments Act (for brevity 'the Act') is the appellant. The case of the complainant was that he was the wholesale dealer in pesticides and the accused was the retail purchaser from the complainant. The accused had a running account with the complainant in respect of the said business. He used to purchase the pesticides on credit basis from the complainant and eventually became due in a sum of Rs.1,25,000/-. When the complainant demanded the accused to pay the said amount, he issued a cheque for Rs.1,25,000/- on 26-6-1998. The complainant presented the cheque with the Bank of Baroda, Khammam Branch, but was returned dishonoured on the premise of "insufficiency of funds". The complainant, therefore, got a legal notice dated 28-7-1998 issued to the accused. The accused having received the same on 4-8-1998 sent a reply with false allegations. The complainant, therefore, got a rejoinder notice issued to the accused which was received by him on 28-8-1998. However, the accused failed to pay the amount covered by the cheque in question. Hence, the complaint. 3. The accused who appeared before the Court pursuant to the summons pleaded not guilty. The complainant during the course of trial examined two witnesses on his side and got Exs.P.1 to P.17 marked. After the evidence on the side of the prosecution was completed, the accused was examined under Section 313 of the Code of Criminal Procedure, He denied the incriminating material put to him. He did not choose to examine any defence witness when called upon to enter upon his evidence. Exs.D-1 and D.2 were marked during the course of evidence on the side of the complainant. 4. Appreciating the evidence, both oral and documentary, the Court below was of the view that the complainant failed to discharge the burden cast upon him by proving the execution of the cheque when the accused denied the same; and that there were alterations in the memos issued by the Bank which could not be satisfactorily explained and, therefore, the accused was not guilty. 5. The learned Counsel appearing for the appellant represents that when the complainant filed Crl. 5. The learned Counsel appearing for the appellant represents that when the complainant filed Crl. M.P. No.6076 of 2000 requesting the Court 'below to send the documents in question to an Expert for his opinion, that application ended in dismissal on 9-10-2000 with the finding that the complainant need not approach an Expert as the accused admitted his signature on the cheque and, therefore, the Court below ought not to have given the finding that the burden cast upon the complainant was not discharged. It is his further contention that there were no alterations on the dates in the memos and such alterations, if any, would not affect the case of the appellant. 6. The learned Counsel appearing for the respondent, on the other hand, represents that it was a clear case where the legal notice was not issued to the accused within 15 days from the date of intimation from the Bank and infraction thereof affects the merits of the case. 7. The complainant was examined as P.W.1 in this case. He deposed in his evidence categorically that the accused purchased pesticides on credit basis from him during the year 1997 for a total value of Rs.2,11,000/- and he paid an amount of Rs.55,000/- on one occasion and returned the pesticides worth Rs.41,000/- on another occasion and eventually the accused became due in a sum of Rs.1,15,000/- as per the account and with the accrued interest thereon of Rs.10,000/-, the total due from the accused was Rs.1,25,000/-. He further deposed unequivocally that the accused issued a cheque dated 26-6-1998 for Rs.1,25,000/- drawn on Andhra Bank, Kothagudem and when the cheque was presented with the Bank of Baroda, Khammam, eventually it was returned dishonoured on 24-7-1998 with endorsement as "insufficient funds". Ex.P.1 is the cheque dated 26-6-1998 for a sum of Rs.1,25,000/-. Exs.P.2 and P.3 are the Bank memos whereunder eventually the complainant was informed about the dishonour of the cheque. Exs.P.9 to P.16 are the various invoices and transport receipts whereunder the goods were transported to the shop of the accused from the complainant. This statement made on oath by the complainant was not shaken in the cross-examination in any manner. Two suggestions came to be made during the course of cross-examination of P. W.1. Exs.P.9 to P.16 are the various invoices and transport receipts whereunder the goods were transported to the shop of the accused from the complainant. This statement made on oath by the complainant was not shaken in the cross-examination in any manner. Two suggestions came to be made during the course of cross-examination of P. W.1. The first suggestion was to the following effect :- "It is not true to say that I obtained two blank signed cheques and two blank signed pro-notes from the accused at the time of opening khata; and that the accused opened bank account in Andhra Bank, Kothagudem for the purpose of khata as collateral security, as asked by us". The second suggestion was thus :- "It is false that the accused did not issue the cheque in discharge of his liability and that the signature on the cheque was not made by the accused." At the end of the cross-examination, it was suggested thus :- "It is not correct to say that I obtained two blank cheques and two blank promissory notes by forging the signatures of the accused on them". The first suggestion and the latter two suggestions, as excerpted hereinabove, are obviously inconsistent. Perhaps, having due regard to the first suggestion made, the Court below initially rejected the application filed by the complainant whereunder he requested the Court below to send Ex.P.1 cheque to an Expert for comparison and opinion. There has been no gainsaying about the business transactions in between the complainant and the accused. No evidence worth the name has been adduced by the accused to buttress his plea that the complainant obtained two blank signed cheques and two blank signed promissory notes from him. Having regard to the inconsistent suggestions put to P.W.1, I am of the considered view that there has been no categorical denial on the side of the accused about the due execution of Ex.P.1 cheque. The cheque obviously was issued from the cheque book of the accused since there has been no gainsaying of the same. Therefore, it cannot be said that it is a case where the complainant failed to discharge the burden cast upon him to prove the execution of EX.P.1 cheque. The cheque obviously was issued from the cheque book of the accused since there has been no gainsaying of the same. Therefore, it cannot be said that it is a case where the complainant failed to discharge the burden cast upon him to prove the execution of EX.P.1 cheque. Although there has been no evidence in the form of opinion of an Expert but the attending circumstances in the case would amply suggest that it was a clear case where Ex.P.1 cheque was issued by the accused in favour of the complainant. The genuineness of the signature can be proved by direct evidence, by circumstantial evidence or by opinion of an Expert. Merely because the signature is denied, it is not an invariable rule that always the document shall have to be referred to an Expert. The attending circumstances, namely, the inconsistent suggestions put to P.W.1 in the cross-examination, are sufficient enough to draw the necessary inference from out of it that the cheques and promissory notes were issued after having appended the signatures but it was a case of blank cheques and blank promissory notes. Therefore, it is not a clear case of denial of signatures on the cheques and promissory notes and hence the execution of EX.P.1 cheque can be held to have been proved without any hesitation. " 8. Apropos the other question of alteration of Bank memos, Exs.P-2 and P.3 are two Bank memos. While Ex.P.2 is the bank memo sent by Andhra Bank, Kothagudem Branch; Ex.P.3 is the yet another memo sent by the same Bank to the Bank of Baroda. P.W.2 is the Special Assistant at Bank of Baroda, Gandhi Chowk, Khammam Branch, who seeks to prove these two documents. According to his evidence, Ex.P.1 cheque was presented at his Branch for collection and it bears the signature of the Joint Manager of the Bank on its overleaf and it had been sent for collection to Andhra Bank, Kothagudem Branch and when the cheque was later returned by Andhra Bank on 10-7-1998 but was received on 24-7-1998 and the Bank informed the complainant about the dishonour of the cheque on 25-7-1998. The witness admitted in the cross-examination that there had been a correction on the date from 15-7-1998 to 10-7-1998 and the cheque number from 3059 to 10758 on EX.P.2 memo. The witness admitted in the cross-examination that there had been a correction on the date from 15-7-1998 to 10-7-1998 and the cheque number from 3059 to 10758 on EX.P.2 memo. The witness further admitted that the date on the debit advice was altered to 24-7-1998 and the date 27-7-1998 was changed to 24-7-1998 on the other debit advice. The witness flatly denied the suggestion that those· alterations were made by the Bank of Baroda, Khammam Branch, so as to help the customer to file the complaint within time. Through this witness, Exs.D.1 and D.2 came to be marked EX.D.1 is the debit advice under which an amount of Rs.168/- has been debited and Ex.D.2 is the debit advice under which an amount of Rs.171/ - has been debited. There appears to be correction in the date on EX.D.1 but there appears no correction in the date on EX.D.2. But, on Ex.P.2 there appears to be a correction. The digits" 15" appear to have been corrected as digits" 10”. However, on the overleaf of this document at the bottom, the date has been mentioned as 10-7-1998. So the correction of the date in the front page at the top from 15-7-1998 to 10-7-1998 loses its significance. No such alteration has been alleged in respect of Ex.P.3 since it does not bear any date. EX.P.2 emanates from the drawer Bank, namely, Andhra Bank, Kothagudem Branch. Obviously, P.W.2 is not an Officer of that Bank. This document shows that the cheque has been dishonoured for want of sufficient funds. The correction in cheque number is of no consequence having due regard to the contentions of the parties. The date on which Ex.P.2 memo reached Bank of Baroda, Khammam, is the crucial date. The statement of P.W.2 that his Bank received Ex.P.2 memo on 24-7-1998 and in its turn the Bank intimated the complainant about the dishonour on 25-71998 remained unassailed in the cross-examination. P.W.2 was later re-called and further examined with reference to the original cheque return register. The certified copy thereof was marked as Ex.P.17. The original of Ex.P.17 shows that an entry has been made about Ex.P.1 cheque. According to this document, the return of the cheque was entered on 24-7-1998. This clearly establishes that necessary entry was made in the register about the receipt of the cheque from the drawer bank on 24-7-1998. Ex.P.17, therefore, strengthens the evidence ofP.W.2. The original of Ex.P.17 shows that an entry has been made about Ex.P.1 cheque. According to this document, the return of the cheque was entered on 24-7-1998. This clearly establishes that necessary entry was made in the register about the receipt of the cheque from the drawer bank on 24-7-1998. Ex.P.17, therefore, strengthens the evidence ofP.W.2. He is an official witness. No motive or ill will has been attributed to him ill-ill the respondent so as to speak falsehood to help the complainant. There is no reasons as to why the evidence of this witness shall not be trusted. Since the witness deposed only with reference to the documents, his evidence can safely be trusted without any hesitation. That clearly establishes that the complainant was informed about the dishonour of the cheque only on 25-7-1998. 9. It is not shown about the relevancy of Exs.D.1 and D.2 debit advices. Under these two documents, amounts of Rs.168/- and Rs.171/- respectively were debited to the account of the complainant. As discussed hereinabove, the statement of P.W.2 i.e., the Bank received the returned cheque on 24-7 -1998 and informed the complainant about the dishonour of the cheque on 25-7 -1998 since not controverted in the cross-examination, I see no reason as to why that his statement shall not be taken into consideration. It is ultimately the date on which the complainant was informed about the dishonour that is crucial. The delays elsewhere are of no significance insofar as the complainant is concerned. Obviously, Ex.P.4 legal notice was issued on 28-7-1998. It was received by the respondent on 4-8-1998. According to the evidence of P.W.2, as discussed hereinabove, the complainant was informed about the dishonour of the cheque on 25-7-1998. From that date, the legal notice, Ex.P.4, is obviously within 15 days. 10. The contention of the learned Counsel appearing for the respondent appears to be that EX.P.2 memo since bears the date 10-7-1998 it might have been received by Bank of Baroda, Khammam Branch on the very next day or a couple of days after 10-7-1998 and from that possible date of receipt of the said memo, the complainant would have been intimated immediately thereafter and since Ex:P.4 legal notice was issued on 28-7-1998, it is beyond 15 days. Such a contention basing on inferences and surmises cannot be countenanced. What is required is the positive evidence. Such a contention basing on inferences and surmises cannot be countenanced. What is required is the positive evidence. Therefore, for the reasons hereinabove discussed, I am afraid that I cannot accede to the said contention of the learned Counsel appearing for the respondent. 11. Even otherwise, assuming for a moment that legal notice, Ex.P.4 was issued not within 15 days but beyond 15 days, the consequence thereof shall have to be considered. Section 138 of the Act is the relevant section. The proviso thereof may be excerpted hereunder thus for brevity and better understanding of the matter: "Provided that nothing contained in the section shall apply unless(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier; (b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice, in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;, and (c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice. Explanation :- For the purposes of this section, 'debt or other liability' means a legally enforceable debt or other liability." (Emphasis is mine) 12. From a glance at the above provision, it is obvious that the cheque is required to be presented to the Bank within a period of six months from the date on which it is drawn. Explanation :- For the purposes of this section, 'debt or other liability' means a legally enforceable debt or other liability." (Emphasis is mine) 12. From a glance at the above provision, it is obvious that the cheque is required to be presented to the Bank within a period of six months from the date on which it is drawn. The payee of the cheque shall make a demand for payment in the event of its dishonour in writing to the drawer of the cheque within 30 days (15 days prior to amendment under Act 55 of 2002 which period applies to the instant case), of the receipt of information by him from the Bank regarding its return and if the drawer of the cheque fails to make the payment of the said amount within 15 days of receipt of the said notice, he shall be deemed to have committed an offence punishable under Section 138 of the Act. 13. The other provision which requires to be considered at this juncture is Section 142 the Act. The provision reads as under: "142. Cognizance of offences :Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974)- (a) no Court shall take cognisance of any offence punishable under Section 138 except upon a complaint, in writing, made by the payee or, as the case may be, the holder in due course of the cheque; (b) such complaint is made within one month of the date on which the cause of action arises under clause (c) of the proviso to Section 138: Provided that the cognizance of a complaint may be taken by the Court after the prescribed period, if the complainant satisfies the Court that he had sufficient cause for not making a complaint within such period. (c) no Court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the first class shall try any offence punishable under Section 138." (Emphasis is mine) 14. As can be seen from clause (b) of Section 142, the complaint shall be made within one month from the date on which the cause of action arises under Clause (c) of the proviso to Section 138. As can be seen from clause (b) of Section 142, the complaint shall be made within one month from the date on which the cause of action arises under Clause (c) of the proviso to Section 138. A combined reading of Clause (b) of Section 142 and Clause (c) of the proviso to Section 138 makes it obvious that the cause of action for filing a complaint arises when the accused i.e., the drawer of the cheque fails to make the payment within 15 days of the receipt of the notice from the complainant. Obviously, as can be seen from the mandate contained in Section 142, the Court shall not take cognizance of any offence when the complaint is not made within 'one month from the date on which the cause of action has arisen. Therefore, what is crucial to be seen is the date on which the notice was issued demanding payment of the amount covered by the dishonoured cheque; when it was received by the drawer of the cheque; when the cause of action had arisen; and when the complaint in fact was filed before the Court. The period of 15 days prescribed under Clause (c) of proviso to Section 138, in that view of the matter, is of no significance since that period has nothing to do with the date on which the cause of action arises. But then the fact that the statute has fixed a specific period for issuing notice cannot be ignored. It is no doubt true that cause of action means not a mere fact but it is a bundle of facts which eventually give rise the necessary right for the aggrieved party to initiate proceedings and the bundle of facts include legal notice to be given by the complainant to the accused within 15 days from the date of receipt of intimation from the Bank. Even if that period of 15 days is exceeded, it will not alter eventually the period of limitation provided under Section 142 of the Act. Even if that period of 15 days is exceeded, it will not alter eventually the period of limitation provided under Section 142 of the Act. In my considered view, if no such period is fixed, the complainant might choose to issue notice at his own time perhaps long after the date of dishonour of the cheque which might cause inconvenience to the drawer of the cheque in making necessary arrangements to see that the cheque is honoured again or the contents of the cheque are paid to the complainant. It is, therefore, expedient to fix a reasonable period for the complainant to act. Excepting that, I see no other purpose since it is not one among the bundle of facts that constitute cause of action as can be seen from a combined reading of Sections 138 and 142 of the Act as discussed hereinabove. Therefore, even assuming that the legal notice was issued beyond the period of 15 days and in the instant case no rough calculation it would have been issued on 16th day, the complaint in this case cannot be said to have been barred by limitation, inasmuch as from the date of cause of action, it is obviously within the period of 30 days. The cause of action has obviously arisen in this case on 198-1998. The complaint in this case was filed on 5-9-1998. The infraction of not issuing the legal notice within 15 days as mandated under Clause (b) of the proviso to Section 138, when the complaint is filed obviously within 30 days from the date on which cause of action has arisen, in my considered view, pales into in significance. The period set forth in the said clause appears to be reasonable period to be adhered to by the complainant. 15. The learned Counsel appearing for the respondent seeks to place reliance upon a judgment of the Apex Court in K. R. Indira Vs. Dr. G. Adinarayana, (2003)8 SCC 300 : [2003 ALL MR (Cri) 2706 (S.C.)]. That was a case which dealt with the validity of the legal notice to be issued by the complainant to the accused and the contents thereof. Dr. G. Adinarayana, (2003)8 SCC 300 : [2003 ALL MR (Cri) 2706 (S.C.)]. That was a case which dealt with the validity of the legal notice to be issued by the complainant to the accused and the contents thereof. Incidentally, in Para 10 of the judgment, the Apex Court held about the acts which are the components of the offence, viz., (1) drawing of the cheque by a person on an account maintained by him with a banker, for payment to another person from out of that account; (2) presentation of the cheque by the payee or the holder in due course to the bank; (3) retuning the cheque unpaid by the drawee bank for want of sufficient funds to the credit of the drawer; (4) giving notice in writing to the drawer of the cheque within 15/30 days of the receipt of information by the payee from the bank regarding the return of the cheque and (5) failure of the drawer to make payment to the payee or the holder in due course of the cheque, of the amount covered by the cheque within 15 days of the receipt of the notice. The Judgment of the Apex Court is not relevant for the proposition sought to be canvassed by the learned Counsel that the legal notice by the complainant shall be issued within 15/30 days from the date of receipt of information about the dishonour of the cheque from the Bank and the consequences of the infraction thereof. 16. Factually there has been sufficient foundation in the evidence to show that the complainant received the information from the Bank on 25-7-1998. Even otherwise. for the reasons discussed hereinabove, the cause of action has arisen in this case on the respondents' failure to pay the amount covered by the cheque within 15 days from the date of receipt of the legal notice. From that date, the complaint having been filed within 30 days, the contention of the learned Counsel appearing for the respondent merits no consideration. In any view of the matter, it is a clear case that the respondent is guilty of the offence. The Court below without assigning any cogent and convincing reasons, on different considerations recorded the finding of not guilty and ordered an acquittal. That finding is not correct and is liable to be set aside. 17. In any view of the matter, it is a clear case that the respondent is guilty of the offence. The Court below without assigning any cogent and convincing reasons, on different considerations recorded the finding of not guilty and ordered an acquittal. That finding is not correct and is liable to be set aside. 17. For the above reasons, I find the respondent is guilty of the offence alleged and is convicted accordingly under Section 138 of "the Act. The criminal appeal is, therefore, allowed and the order of acquittal recorded by the Court below is hereby set aside. 18. Heard the learned Counsel appearing for the respondent on the quantum of sentence. The learned Counsel representing the respondent/accused pleaded for a lenient view. Having due regard to the nature of the offence committed and the amount involved in this case, I am of the considered view that the facts justify a lenient view to be taken. At this juncture, it is not expedient to sentence the respondent/accused to suffer any imprisonment. Instead, ends of justice will be met if he is sentenced to pay a fine of Rs.150,000/-. He is accordingly sentenced to pay a fine of Rs.150,000/- (Rupees one lakh and fifty thousand). In default, he is sentenced to suffer imprisonment for a period of six months. Out of the fine amount to be paid by the respondent/accused, the appellant shall be paid a compensation of Rs.1,25,000/- (Rupees one lakh and twenty five thousand).