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2012 DIGILAW 4518 (MAD)

K. Veeraiah v. Ganesh Credits, Rep. by its Proprietor, R. Babu

2012-11-01

C.S.KARNAN

body2012
Judgment :- 1. The revision petitioner/appellant/accused has preferred the present revision in Crl.R.C.No.210 of 2010 against the judgment made in C.A.No.67 of 2009, on the file of IV Additional Sessions Judge, Chennai, confirming the conviction and sentence passed in C.C.No.13688 of 2005, on the file of XIII Metropolitan Magistrate, Egmore, Chennai. 2. The respondent/complainant's case is as follows:- The accused, along with his son has stood as guarantor for repayment of a sum of Rs.2,00,000/- financed by the complainant for hire purchase of car, a Ford Icon bearing registration No.TN-10C-1408. In order to discharge the said debt, the accused had issued a cheque dated 02.01.2003 for Rs.60,000/-bearing No.826414 drawn on Indian Overseas Bank, Perambur, Chennai-11 towards part payment of the said loan. The complainant presented the said cheque with his bankers, viz., Union Bank, Triplicane Branch, Chennai-5 on 25.01.2003 and the cheque was returned on 28.01.2003 with an endorsement of "payment stopped by drawer". The complainant was intimated about return of cheque on 29.01.2003. The complainant issued a legal notice dated 31.01.2003, which was received by the accused on 07.02.2003. As the accused failed to pay the cheque amount, the complainant had filed a complaint against the accused for an offence under Section 138 of Negotiable Instruments Act before the XIII Metropolitan Magistrate, Egmore, Chennai. 3. On being questioned, the accused pleaded not guilty and hence trial was conducted. On the complainant's side, one witness was examined and ten documents were marked as Exs.P1 to P10, viz., Ex.P1-letter dated 02.03.2002 of K.V. Varaprasad to the complainant, Ex.P2-letter dated 22.04.2002 of K.V. Prasad to the complainant, Ex.P3-letter dated 25.04.2002 of the accused to the complainant, Ex.P4-cheque dated 02.01.2003 for Rs.60,000/-, Ex.P5-return memo of I.O.B., Perambur Branch, Ex.P6-debit advice, Ex.P7-copy of legal notice dated 31.01.2003, Ex.P8-postal receipt, Ex.P9-acknowledgment card and Ex.P10-reply notice. On the side of the accused, one Tr. Madhan Sing was examined as R.W.1 and stop payment instruction given by the acused to Branch Manager, Indian Overseas Bank, Perambur Branch dated 03.11.2002 was marked as Ex.R1. 4. P.W.1, in his proof affidavit had deposed that he is the Proprietor of the complainant concern, viz., M/s. Ganesh Credits and that he is carrying on the business of lending loans for two wheelers and four wheelers on the security of R.C.Book. 4. P.W.1, in his proof affidavit had deposed that he is the Proprietor of the complainant concern, viz., M/s. Ganesh Credits and that he is carrying on the business of lending loans for two wheelers and four wheelers on the security of R.C.Book. He deposed that one Paul Vincent along with K.V. Varaprasad, son of the accused herein and one Sasikumar, an employee under Paul Vincent approached him and requested him to lend Rs.2,00,000/- as H.P.loan for For Icon Car No.TN-10C-1408, owned by Paul Vincent, on the security of its R.C.Book. He deposed that he lent a sum of Rs.2,00,000/-to Paul Vincent on 25.01.2002, after receiving the R.C.book, and that the said Varaprasad and Sasikumar stood as security for the due repayment of the said loan. During February 2002, when the said R.C.book was sent to the R.T.O. authorities for endorsement of the hire purchase favouring his concern, it was found that the said R.C.book was not original, but a fabricated and forged one. P.W.1 deposed that he had tried to contact Paul Vincent, but he had vacated his house and his whereabouts were not known. When he was about to lodge a police complaint, K.V. Varaprasad and Sasikumar admitted that they had conspired together with Paul Vincent to forge and fabricate the said R.C.book for the purpose of using the same to obtain loan from him and to cheat him. They also pleaded not to lodge any police complaint and they promised that they would settle the loan amount immediately. K.V. Varaprasad acknowledged his liability through his letter dated 02.03.2002 to him and promised to settle the loan. The said letter was marked as Ex.P1. He also admitted his involvement in the forgery and fabrication of the said R.C.book through his letter dated 22.04.2002. The said letter dated 22.04.2002 is Ex.P2. The accused herein, taking the responsibility of repayment of loan, stood guarantee through his letter dated 25.04.2002, which is marked as Ex.P3.The accused, thereafter, in order to discharge the said loan issued three cheques bearing Nos.826413, 826414 and 826415 dated 02.11.2002, 02.01.2003 and 02.03.2003, all drawn on Indian Overseas Bank, Perambur Branch, Chennai-11, each for a value of Rs.60,000/-. The cheque bearing No.826414, dated 02.01.2003, concerned in this case was marked as Ex.P4. The cheque bearing No.826414, dated 02.01.2003, concerned in this case was marked as Ex.P4. When the said cheque was presented for collection on 25.01.2003 through the complainant's bankers, viz., Union Bank, Triplicane Branch, the said cheque was returned unpaid with an endorsement of "payment stopped by drawer" (Ex.P5). P.W.1 deposed that he was intimated about return of cheque through his bank's debit advice dated 29.01.2003, which is marked as Ex.P6. He issued a legal notice dated 31.01.2003 by registered post (Ex.P7). The postal receipt dated 07.02.2003 is Ex.P8. The accused duly acknowledged the receipt of notice on 10.02.2003 as per acknowledgment card (Ex.P9). The accused sent a reply notice dated 20.02.2003 which is marked as Ex.P10. 5. R.W.1, Madhan Singh, the Senior Indian Overseas Bank, Perambur Branch had adduced evidence that the accused maintained an account in their bank in account No.19368 and that he was provided with cheque facility. He deposed that the accused had given "stop payment instructions" to the bank in the year 2002 for the cheque Nos.826413 and 826415. He deposed that they had given acceptance for the same and the document is marked as Ex.R1. He deposed that the accused had mentioned in the letter that M/s. Ganesh Credits have obtained the cheques under threat and coercion in the police station. 6. The case of the accused is that the complainant has given finance to Paul Vincent for purchase of Ford Icon Car, TN-10-C-1408 and the accused's son Varaprasad has stood as guarantor. Paul Vincent has forged the R.C.book and he was absconding and so, a complaint was lodged in D-2 Police Station as against Varaprasad and based on the complaint, the accused was brought to the police station and blank cheques were obtained from him as security. It is seen that the accused himself in the letter dated 25.04.2002 has undertaken to pay Rs.50,000/-on 10.05.2002 and the balance amount within the 30th of May. It is seen that Exs.P1, P2 and P3 are letters through which accused and his son have acknowledged the liability. Further, when it is the case of the accused that the complaint had been lodged in D-2 Police Station as against Varaprasad and the cheques of the accused were obtained under threat in the presence of Inspector-Udayakumar, the accused should have sent for the documents from D-2 Police Station and should have examined Inspector-Udayakumar to prove the same. Further, when it is the case of the accused that the complaint had been lodged in D-2 Police Station as against Varaprasad and the cheques of the accused were obtained under threat in the presence of Inspector-Udayakumar, the accused should have sent for the documents from D-2 Police Station and should have examined Inspector-Udayakumar to prove the same. But, in spite of summoning the Inspector on several occasions, the accused has not chosen to examine the Inspector as a witness before the Court. 7. Hence, the learned Magistrate, on considering the oral and documentary evidence held the accused guilty of offence under Section 138 of Negotiable Instruments Act and sentenced the accused to undergo simple imprisonment for a period of six months and directed him to pay compensation of Rs.60,000/- to the complainant. 8. Aggrieved by the conviction and sentence imposed by the trial court, the accused has preferred an appeal in C.A.No.67 of 2009, before the IV Additional Sessions Judge, Chennai. The learned judge after scrutiny of the oral and documentary evidence and after perusal of the trial Court's order, dismissed the appeal and confirmed the order of trial Court. 9. Aggrieved by the dismissal of his appeal, the appellant/accused has preferred the present revision. 10. The learned counsel for the revision petitioner has contended that in the complaint, it has been averred that the revision petitioner stood as guarantor but in the proof affidavit, the revision petitioner's son was mentioned as guarantor to a third person under H.P. agreement and as such controversial statements had been made. It was contended that the learned appellate judge failed to take into consideration that the cheque was received by the respondent in Anna Salai Police Station in the presence of Inspector of Police, which fact was not stated in the complaint. It was pointed out that the averments made in the proof affidavit clearly shows that the issue of cheques by the revision petitioner arose only when his son was kept in the police station and under such circumstances, issuing of cheques, as held by the this Court, will not give rise to a legally enforceable debt or liability to prosecute the case under Section 138 of Negotiable Instruments Act. The learned counsel for the revision petitioner further submitted that as per complainant's statement, he had paid a sum of Rs.2,00,000/- to one Paul Vincent, who was the employer of the accused's son. As such, the forgery had been committed by Paul Vincent and not the accused's son. But the complainant levelled a case before the Police Station in which the accused's son had been falsely implicated. In order to secure the son of the accused, the accused was forced to issue cheques for the said amount. As such, the accused had issued the cheques and it was not for discharge of any legally enforceable debt. The learned counsel further submitted that the said transaction was committed by Paul Vincent and therefore, the complainant cannot claim any amount from the accused as a legally enforceable debt. The learned counsel further submitted that the cheque had been collected at the Police Station, by the complainant on the strength of the so-called 'complaint', while the accused's son was in the custody of police. In order to release him from the police custody, the cheque was issued and it was not issued on the free will of accused. The complainant's remedy lies only with the criminal Court against the Paul Vincent under Indian Penal Code. As such, the nature of complaint is not maintainable against the accused under Section 138 of Negotiable Instruments Act as the complainant is a a total stranger. 11. The complainant's remedy lies only with the criminal Court against the Paul Vincent under Indian Penal Code. As such, the nature of complaint is not maintainable against the accused under Section 138 of Negotiable Instruments Act as the complainant is a a total stranger. 11. The learned counsel for the revision petitioner has cited the following judgments in support of his contentions:- (i) Hiten P. Dalal v. Bratindranath Banerjee reported in AIR 2001 SUPREME COURT 3897 (1) "(A) Special Court (Trial of Offences relating to Transactions in Securities) Act (27 of 1992), S.3(2) - Special Court – Jurisdiction – Not limited to offences committed between 01.04.1991 and on or before 06.06.1992 – Such period specified in S.3(2) relates to transaction in securities and not to offence." (ii) B. Ramachandra Reddy v. Abid Ali and Anr reported in 2007 (1) Bankmann 433 "(i) Negotiable Instruments Act, 1881-Section 138 – Dishonour of cheque – Cheque need not necessarily be drawn for discharge of any debt or other liability of drawer towards payee – Cheque issued by son, accused, in discharge of liability of his father – Accused son was rightly convicted by trial Court and sentenced – Lower appellate Court's judgment acquitting accused on ground that there existed no relationship of creditor and debtor was liable to be set-aside." (iii) Vishnu Bhat v. Narayan R. Bandekar and Ors. reported in 2008 (2) Bankmann 110 (Bom.) "Negotiable Instruments Act, 1881 – Section 138 – Dishonour of cheque – Order of acquittal by trial Court – Appeal – Demand notice was addressed to three different persons, i.e, entities and was sent in one envelope addressed to accused No.2, Managing Director of accused No.1 Company and Firm accused No.3 – Cheque was issued by accused from his personal account but admittedly to meet the liability of accused No.A2 and A3 under an Award passed by Labour Court – Notice was duly served upon accused – Merely that accused had paid the amount to complainant later on will not absolve them of the liability for offence – Acquittal was unsustainable and accused were liable to be convicted – In view of the facts and circumstances accused to pay Rs.20,000/- as compensation." (iv) M. Chandrashekar Rao versus V. Kutamba Rao and Anr., Criminal Appeal No.1152 of 2004. "Negotiable Instruments Act, 1881 – Section 138 "Dishonour of cheque". "Negotiable Instruments Act, 1881 – Section 138 "Dishonour of cheque". No evidence has been adduced on behalf of the accused to show that he was forced by the police to issue cheques. The accused is not an illiterate and he is a postgraduate working as lecturer in Government College. If really, the complainant obtained post dated cheques or blank cheques from the accused with the aid of police, nothing prevented the accused to report the matter to the higher authorities or to issue notice to the complainant stating that the promotes executed and the cheques issued are not voluntary and are not binding on him – Similar plea was taken before the Civil Court and the Civil Court after consideration rejected the said contention. Therefore, the Court below grossly erred in holding that the cheques in dispute were obtained from the accused forcibly. The said finding of the Court below is liable to be set-aside - In this case were issued by the accused towards partial discharge of a legally enforceable debt – Merely because the dishonour of one of the five cheques Ex.P5 by the bank was not a valid dishonour for the reason of being premature, it cannot be said that the accused is not liable to comply with the demand in respect of other four cheques Exs.P1 to P4 though the amounts covered under those dishonoured cheques were separately mentioned. Merely because the additional amount, i.e, the amount covered under Ex.P5 is also demanded under the same notice, it cannot be said that the demand notice in respect of Exs.P1 to P4 cheques also is invalid for the reason. (v) Dr. Sampath Kumar B.V. v. Ms. Dr. Merely because the additional amount, i.e, the amount covered under Ex.P5 is also demanded under the same notice, it cannot be said that the demand notice in respect of Exs.P1 to P4 cheques also is invalid for the reason. (v) Dr. Sampath Kumar B.V. v. Ms. Dr. K.G.U. Lakshmi reported in 2006 (2) Bankmann 295 "Negotiable Instruments Act, 1881 – Section 138 – Dishonour of cheque – Defence plea that it was given as security for loan taken by accused and was issued blank – Acquittal by trial Court – Appeal – Inference by Trial Court that cheque issued was blank was based on no cogent material – cheque whether issued for repayment of loan or as security would make little difference and legal consequences on its dishohnour were same – Respondent accused was liable to be convicted – Cheque was issued for Rs.75,000/- - Respondent accused sentenced to pay a fine of Rs.1,50,000/- in default to undergo six months rigorous imprisonment and if fine released, Rs.1,40,000/- to be paid to complainant as compensation." 12. The learned counsel for the complainant submitted that one Varaprasad and Sasikumar stood guarantee to obtain loan from the complainant on behalf of one Paul Vincent. The complainant also is a financier and has paid a loan amount after collecting R.C.book and created legal document viz., hire purchase agreement. After verification, all the three persons had jointly committed forgery to produce bogus R.C.book but no such vehicle is available. Therefore, the complainant had initially approached the concerned police station and levelled a complaint against all three accused persons. The complaint is also a bona fide one and all the accused persons are guilty of fraud as per Indian Penal Code and as such, they shall be punished under Indian Penal Code. In order to prevent the accused from being punished, the accused rushed to the police station and admitted the guilt committed by his son. Therefore, the accused issued cheque in favour of the complainant and closed the criminal offence. The learned counsel further submitted that as a strategy, the accused had raised irrelevant contentions to evade payment and punishment. The complainant had listed nine documents and proved the case beyond doubt, against the accused. The same was confirmed by the learned appellate Court. 13. Therefore, the accused issued cheque in favour of the complainant and closed the criminal offence. The learned counsel further submitted that as a strategy, the accused had raised irrelevant contentions to evade payment and punishment. The complainant had listed nine documents and proved the case beyond doubt, against the accused. The same was confirmed by the learned appellate Court. 13. On verifying the facts and circumstances of the case and arguments advanced by the learned counsels on either side and on perusing the impugned judgments of the Courts below, this Court does not find any discrepancy in the conclusions arrived at for punishing the accused. However, the sentence of six months simple imprisonment imposed on the accused is on the higher side and compensation amount is also on the higher side. Therefore, this Court reduces the sentence from six months simple imprisonment to two months simple imprisonment and also reduces the compensation from Rs.60,000/- to Rs.30,000/- (Rupees Thirty Thousand only) as it is found to be appropriate in the instant case. The accused has to either pay the compensation amount or to undergo two months simple imprisonment. This Court directs the learned XIII Metropolitan Magistrate, Egmore, Chennai, to issue bailable warrant on the accused and secure him forthwith. If the accused remits the said compensation amount of a sum of Rs.30,000/- into the credit of C.C.No.13688 of 2005, on the file of XIII Metropolitan Magistrate, Egmore, Chennai, before being remanded into judicial custody, the accused would be set at liberty and the sentence of simple imprisonment imposed on him would not be executed. If the accused deposits the said amount, it is open to the complainant to withdraw the same after filing a Memo before the trial Court. This order has been passed after invoking the discretionary power vested with it. 14. In the ultimate analysis, the above revision is partly allowed with the above modifications. Consequently, the judgment and conviction passed in C.A.No.67 of 2009, on the file of IV Additional Sessions Judge, Chennai, dated 22.01.2010, confirming the conviction and sentence passed in C.C.No.13688 of 2005, on the file of XIII Metropolitan Magistrate, Egmore, Chennai, dated 23.01.2009 is modified.