Karnataka High Court
Mr Vijaya Megharaj vs Mr Shankar on 17 January, 2023
Author: P.N.Desai
Bench: P.N.Desai
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CRL.A No. 525 of 2012
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 17TH DAY OF JANUARY, 2023
BEFORE
THE HON'BLE MR JUSTICE P.N.DESAI
CRIMINAL APPEAL NO. 525 OF 2012
BETWEEN:
MR. VIJAYA MEGHARAJ,
AGED ABOUT 31 YEARS,
S/O. SRI. VENKATESH,
R/AT NO.182, CUBBONPET MAIN ROAD,
BANGALORE-560 002.
...APPELLANT
(BY SRI. M.D.ALAVANDAR., ADVOCATE)
AND:
MR.SHANKAR,
AGED ABOUT 37 YEARS,
S/O. SRI.RAJASHEKAR,
R/AT NO.401, ABBAIAH REDDY BUILDING,
GARVEBHAVIPALYA HOSUR ROAD,
BANGALORE-560068.
Digitally signed
by ...RESPONDENT
NAGARATHNA M
Location: HIGH (BY SRI. M. SUBRAMANI, ADVOCATE)
COURT OF
KARNATAKA
THIS CRL.A. IS FILED U/S.378(4) OF THE CRIMINAL
PROCEDURE CODE, PRAYING TO SET ASIDE THE JUDGMENT
DATED: 07.03.2012 PASSED BY THE XVIII ACMM & XX
ADDITIONAL SMALL CAUSES JUDGE., BANGALORE IN
C.C.NO.8095/2006 - ACQUITTING THE RESPONDENT FOR THE
OFFENCE PUNISHABLE UNDER SECTION 138 OF N.I. ACT.
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CRL.A No. 525 of 2012
THIS APPEAL, COMING ON FOR FURTHER DICTATION, THIS
DAY, THE COURT DELIVERED THE FOLLOWING:
JUDGMENT
This appeal arises out of the judgment of acquittal passed in C.C.No.8095/2006 dated 07.03.2012 by the XVIII ACMM & XX ASCJ, Bengaluru wherein the respondent/accused was acquitted for the offences punishable under Section 138 of Negotiable Instruments Act, 1881 (for short hereinafter referred to as 'N.I.Act').
2. The appellant filed a complaint before the learned Magistrate under Section 200 of Code of Criminal Procedure (for short hereinafter referred to as 'Cr.P.C.') against the accused for the offence punishable under Section 138 of N.I.Act.
3. The appellant is the complainant and the respondent is the accused before the Trial Court. They will be referred as per their respective ranks held before the Trial Court for the sake of convenience. -3- CRL.A No. 525 of 2012
4. It is contended that the accused is known to the complainant. The accused has borrowed a sum of Rs.90,000/- during the month of April, 2005 and towards the repayment of the same, he has issued a cheque bearing No.840034 dated 30.07.2005 for a sum of Rs.90,000/- drawn on Indian Bank, Avenue Road Branch, Bengaluru in favour of the complainant. The complainant demanded the accused to repay the amount. But he did not repay the amount. Infact the accused requested the complainant not to present the cheque issued by him as he was unable to mobilise the funds on 30.07.2005. Thereafter the complainant presented the said cheque on 15.11.2005, but the said cheque was returned dishonored with an endorsement that 'Account Closed'. Hence, the complainant issued statutory legal notice calling upon the accused to pay the amount. Though the notice was served on the accused, the accused neither replied nor come forward -4- CRL.A No. 525 of 2012 to pay the cheque amount. Hence, the complainant lodged the complaint.
5. In order to prove the case of the complainant, he got examined himself as PW.1 and got marked twelve documents as Exs.P1 to P12. The accused got examined himself as DW.1 and examined another witness - B.N.Phaneedra as DW.2 and marked three documents as Exs.D1 to D3. After hearing the arguments, learned ACMM acquitted the accused. Hence, this appeal.
6. Heard Sri. M.D.Alavandar, learned counsel for the appellant and Sri. M.Subramani, learned counsel for the respondent.
7. Learned counsel for the appellant argued that the judgment passed by the learned ACMM is opposed to the evidence on record and facts of the case. The learned ACMM has not appreciated the evidence in -5- CRL.A No. 525 of 2012 proper perspective. The learned ACMM relying on the self-serving testimony of accused, acquitted him which is not tenable. The accused has admitted the signature on Ex.P1/cheque and issuance of cheque. Though the legal notice is served, the accused has not given any reply. But the learned ACMM has failed to consider the presumption arising under Section 139 of N.I. Act and without drawing any presumption, learned ACMM has answered the point No.1 in negative and the same is illegal. The learned ACMM failed to notice that the defence of the accused regarding committing the theft of cheque is neither probable nor proved. The finding of the learned ACMM regarding financial capacity of the complainant to lend the money is not sustainable either in law or in facts. Though the complainant has proved the ingredients of Section 138 of N.I.Act and presumption is also in his favour and when the accused has failed to rebut such presumption, the learned ACMM, has erred in acquitting the accused. -6- CRL.A No. 525 of 2012
8. The learned counsel argued that the complainant and accused are known to each other and they are acquainted with each other and the amount was lent on the basis of mutual trust and desire to help each other. Learned ACMM has held that no documents were obtained for lending the amount such observation is illegal and not tenable, as the amount was lent out of friendship as both appellant and the accused are close friends. Every transaction between friends or relatives payment of interest on the amount lent is not insisted upon or the execution of any document is not required in that regard. In fact Ex.P1 is the document evidencing the loan transaction. Therefore, learned counsel argued that the inference drawn by the learned ACMM is not correct. Learned counsel argued that the accused has stated that the complainant has forged the cheque, the same is also not legally sustainable, in view of the evidence on record. The complainant has not materially altered the cheque. The cheque which was given by the -7- CRL.A No. 525 of 2012 accused was presented for encashment. Therefore, the finding of the learned ACMM is self-contradictory and as the complainant has proved his case, the learned ACMM erred in acquitting the accused hence, prayed to convict the accused by setting aside the said judgment. In support of his arguments, learned counsel relied on the judgment of Hon'ble Supreme Court in the case of P.Rasiya Vs. Abdul Nazer and Anr. reported in 2022 SCC Online SC 1131 . Therefore, with these main arguments, the learned counsel prayed to allow the appeal.
9. Against this, learned counsel for the respondent/accused argued that the learned ACMM has in detail considered the evidence on record and has rightly appreciated the evidence. The complainant first of all has no financial capacity to lend such amount. Further the said cheque was materially altered which cannot be considered as the cheque which was issued -8- CRL.A No. 525 of 2012 for any legally recoverable debt or liability and it is evident from the report of the hand writing expert that the cheque was materially altered. The accused has successfully rebutted the said presumption. Infact the accused intimated the bank to close his account in view of the apprehension that the materially altered cheque may be misused. The accused himself has given his defence evidence and he has also got appointed hand writing expert as a Commissioner who is also examined. The hand writing expert has deposed that the entire cheque is materially altered. Therefore, Ex.P1 has no sanctity and no presumption can arise under the provisions of N.I. Act in respect of such materially altered cheque. The learned counsel also argued that the cross-examination of PW.1 coupled with the evidence of accused and another witness clearly establishes that the accused has rebutted the presumption by preponderance of probability and case of the complainant is not tenable.
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10. Further learned counsel for respondent relied on the decision of coordinate bench of this Court in Crl.A.No.1040/2010 in case of H.T.Kenchegowda Vs. H.D.Umesh dated 23.04.2019 wherein at paragraph No.19, 20, 21, this court by referring to various judgments of Hon'ble Supreme Court has considered the effect of material alteration by the complainant and has reversed the finding of conviction and held that the ingredients of Section 138 are not proved. Learned counsel also relied on decision of coordinate bench of this court in Crl.R.P.No.592/2019 dated 09.6.2022 in the case of Herman Castelino Vs. Dr. Suresh Kudva and at paragraph No.19 this Court has referred to M.L.Tannan's Banking Law and Practice in India Twenty-eighth Edition - 2021, wherein the material alterations has been defined. Further learned counsel also relied on coordinate bench of this court in the case of Crl.R.P.906/2013 dated 27.06.2022 in the case of D.Chandraiah Vs. K.
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CRL.A No. 525 of 2012Gaddigeppa, wherein the Coordinate Bench of this Court has considered the material alteration and considered the defence and has held that cheque has lost its validity in the eye of law. With these main arguments, the learned counsel for the accused prayed to dismiss the appeal.
11. After considering the rival contentions of the parties, the points that arise for consideration of this Court are:
1) Whether the judgment of the Trial Court is illegal, perverse and not based on the settled principles regarding appreciation of evidence?
12. I have perused the judgment of the Trial Court. The learned ACMM has raised two points for consideration. The learned ACMM has referred to the evidence of the complainant and also referred to the documentary evidence such as Ex.P1-Cheque. The
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CRL.A No. 525 of 2012learned ACMM held that the signature on Ex.P1-Cheque is admitted and it is also not in dispute that the legal notice was served on the accused. But it is evident that the cheque was returned with an endorsement that 'Account Closed'. The learned ACMM has referred to the decision of the Hon'ble Supreme Court in the case of Rangappa Vs. Mohan reported in 2010 AIR SCW 2946 wherein the Hon'ble Supreme Court has enunciated the principles regarding presumption arising under Section 139 of NI Act. The Hon'ble Supreme Court has also stated the purpose of enacting Section 138 of N.I. Act and the presumption under Section 139 of N.I. Act. The Apex Court held that these offences are regulatory offence since the bouncing of a cheque is largely in nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. It is also held by Apex Court that the rest of proportionality should guide the construction and interpretation of reverse onus clauses and the accused
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CRL.A No. 525 of 2012cannot be expected to discharge an unduly high standard of proof. It is also evident that the said presumption is a rebuttable presumption and the standard of proof required for rebutting the presumption by the accused is that of 'preponderance of probabilities'. Therefore, if the accused is able to raise a probable defense which creates doubts about the existence of legally enforceable debt or liability, the prosecution can fail.
13. The learned ACMM has also discussed the evidence on record and held that without there being any document for advancing such a huge amount of 90,000/-, it cannot be accepted that the complainant has lend the amount to the accused. Learned ACMM held that there is a violation of Section 269(ss) of the Income Tax Act, wherein the said section states that all transaction involving Rs.20,000/- and above, should be through "Account Payee Cheques". But the complainant
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CRL.A No. 525 of 2012has not paid the amount through Account Payee cheque. Mainly, the learned ACMM has discussed about the evidence of DW.2/handwriting expert - Sri.B.N. Phaneedar and found that there is an alteration in Ex.P1-Cheque. Hence, the learned ACMM has acquitted the accused.
14. This Court being a First Appellate Court has re-appreciated the evidence.
15. PW.1-Complainant has filed his examination- in-chief affidavit and he has reiterated the complaint averments. He has stated about lending the loan, issuance of cheque by the accused and issuance of notice by him. He has produced Ex.P1-Cheque, the legal notice- Ex.P3 and the bank endorsement-Ex.P2. In the cross examination, he has stated that his friend Kumar has introduced accused. He also admitted that he used to go to the house of the accused. He has denied the suggestion that he has taken the cheque from the house
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CRL.A No. 525 of 2012of the accused. He has stated that he has borrowed a sum of Rs.90,000/- from his father and given to the accused, but there is no document to show that he has borrowed the said amount from his father. He has denied the suggestion that there is an alteration in the cheque. His evidence indicates that he used to visit the house of the accused but after filing of the case, the relationship between complainant and accused was not good. Admittedly, the accused issued the cheque which is produced by him and it is returned with an endorsement 'account closed'. Ex.P3 is the legal notice, it is pertinent to note that either in the written complaint or in his notice, complainant has stated the date on which he lent the amount. Though he stated in his complaint that the loan was borrowed for domestic purposes, Ex.P3 states that it is to clear the petty hand loan, he has borrowed loan, which raises some doubt about his contention. Because he has no money and the same was borrowed from his father. To prove the said
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CRL.A No. 525 of 2012fact no records have been produced. If at all, the accused has already availed loan, why he again borrowed a loan is also not found. The cheque was dishonoured as the account was closed. Though the presumption arises in favour of the complainant, whether the presumption is rebutted by the accused by leading defence evidence or by cross examination is to be seen. The accused-respondent has filed his affidavit as DW.1. In his evidence accused has stated that he never borrowed any amount and, in fact, he has closed the bank account long back. He has not issued a cheque since 2003 or 2004, and the entire remaining cheque leafs are returned. The complainant took some of the cheque, when they were on good terms, he kept it and now, he has misused it. He also stated that the cheque is manipulated and the writings are erased. Accused has examined one Sri B.N.Phaneedar, the handwriting expert, who has examined the said cheque and stated that there is an alteration in number, writer has erased
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CRL.A No. 525 of 2012the number '1' and wrote '90' and further he has stated that number '1' was corrected as number '9'. The details are submitted in the report, which is marked as Ex.D3. The respondent also produced the reply notices given by him, which are marked as Ex.D1 and Ex.D2.
16. On perusal of the evidence of the complainant and the accused, it is evident that though the complainant has produced the cheque and issued notice, the same is served, but that is not sufficient. Though there is an initial presumption and the burden has shifted on the accused to show by 'preponderance of probabilities'. The accused has issued a reply notice stating that he has not borrowed any amount and he has closed the account long back. The said reply notices are marked as Ex.D1 and Ex.D2 are not denied, and no efforts are made by the complainant to call for the records from the bank or examine the Manager as to when and why the account is closed. The handwriting
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CRL.A No. 525 of 2012expert's report clearly shows that he executed the cheque at Ex.P1, the wording and numbers are altered. I have also perused the said cheque wherein to a bear eyes, it appears that number '1' is made as '9' and there is also some alteration as stated by the handwriting expert.
17. It is true that as per the decision relied on by the learned counsel for the appellant as stated by the Hon'ble Supreme Court in case of P. Rasiya (supra) that there is a presumption under Section 139 of N.I.Act and at paragraph No.7 it is held as under:
"7. Feeling aggrieved and dissatisfied with the judgment and orders passed by the Appellate Court affirming the conviction of the accused under Section 138 of the N.I. Act, the accused preferred three different Revision Applications before the High Court. By the impugned common judgment and order, the High Court has reversed the concurrent findings recorded by both the courts below and has acquitted the accused on the ground that, in the complaint,
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the Complainant has not specifically stated the nature of transactions and the source of fund. However, the High Court has failed to note the presumption under Section 139 of the N.I. Act. As per Section 139 of the N.I. Act, it shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in Section 138 for discharge, in whole or in part, of any debt or other liability. Therefore, once the initial burden is discharged by the Complainant that the cheque was issued by the accused and the signature and the issuance of the cheque is not disputed by the accused, in that case, the onus will shift upon the accused to prove the contrary that the cheque was not for any debt or other liability. The presumption under Section 139 of the N.I. Act is a statutory presumption and thereafter, once it is presumed that the cheque is issued in whole or in part of any debt or other liability which is in favour of the Complainant/holder of the cheque, in that case, it is for the accused to prove the contrary. The aforesaid has not been dealt with and considered by the High Court. The High Court has also failed to appreciate that the High Court was exercising the revisional jurisdiction and there were
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concurrent findings of fact recorded by the courts below."
18. In this case, the accused by leading his defence evidence, by replying the legal notice and also by appointing the handwriting expert, has rebutted that presumption. The report shows that there is an alteration of the negotiable instrument, if once, there is any alteration of the cheque then the complainant is not entitled for any such presumption. Admittedly, the complainant never lent any such amount and he admits that he borrowed the said amount from his father. He never states that the date on which he borrowed the said amount from his father.
19. The decision relied on by the learned counsel for the accused supports his contention. The decision in Crl.A.No.1040/2010 dated 23.04.2019 in the case of H.T. Kenchegowda Vs. S.D. Umesh, where the Co- ordinate Bench of this Court at paragraph No.19
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CRL.A No. 525 of 2012referred to the effect of material alteration of cheque. The Co-ordinate Bench has also referred to the decision of Kerala High Court and also discussed the effect of material alternation as stated in Section 87 of N.I Act. There is also reference to the decision of the Hon'ble Supreme Court in the case of Seth Loonkaran Sethia Vs. Ivan E. John reported in AIR 1977 SC 336 and also another decision of this Court in the case of B.Krishna Reddy Vs. B.K.Somashekara Reddy reported in ILR 2006 KAR 3111 and at paragraphs 19, 20, 21, 22, 23, 24 and 25 it is held as under:
19. Another contention taken up by the learned counsel for the accused, in respect of material alteration on Ex.P1-the cheque, which was shown the date as 31.01.2002.
The accused disputed the issuance of cheque and also there is material alteration by the complainant by striking out the figure 19 and making correction in number 9 as 2, 8 is left as it is and added 02 by the complainant wherein the accused stated that the year of
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CRL.A No. 525 of 2012the cheque was 1998, the same was altered by the complainant as 2002. In this aspect the learned counsel for the complainant contended that the cheque was dishonored only for the reason that the accused have closed account and not for the material alteration and the issuance of the cheque was not denied and in support of his case, he has relied upon the judgment of division bench Hon'ble Kerala High Court, Division Bench in the case of Bhaskaran Chandrashekharan Vs. Radhakrishnan reported in 1998 Crl.L.J. 3228.
20. On perusal of the judgment of Hon'ble Kerala High Court, Division Bench, it has held as under:
"Negotiable Instruments Act (26 of 1881), Ss.87, 118(b) - Material alteration in cheque - Issuance of undated cheque by drawer - No dispute regarding signature, name and amount shown in cheque -
Insertion of date in cheque by payee holder of cheque in due course - Can
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CRL.A No. 525 of 2012
be presumed as inserted with implied consent of drawer of cheque
- Presumption not rebutted by drawer - Insertion would not amount to material alteration in cheque rendering cheque void."
21. On perusal of the fact of the said case which shows the issuance of the cheque and signature of the cheque has been not disputed by the accused except taking contention, the cheque was undated cheque. The date was inserted by the complainant. But, the fact of the case in hand defers from the case of Kerala High Court, here in this case the date of cheque has been altered which was also admitted by the complainant that there is no signature of accused below the date. On bare perusal of the date as naked eye, it clearly depicts the number 19 has been striked out, the third number 9 has been altered as 2, fourth number 8 has been left as it is and added 02 after the 8. On perusal of the year clearly depicts the year as 2802. There is a clear alteration of the year
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CRL.A No. 525 of 2012on the cheque which was made as 2002 instead of 1998. As per Section 87 of Negotiable Instrument Act which reads as follows:
"87. Effect of material alteration. -
Any material alteration of a negotiable instrument renders the same void as against any one who is a party thereto at the time of making such alteration and does not consent thereto, unless it was made in order to carry out the common intention of the original parties"
22. In this regard Hon'ble Apex Court in the case of Seth Loonkaran Sethia vs Ivan E. John reported in AIR 1977 SC 336 held that:
"A material alteration, is one which varies the rights, liabilities or legal position of the parties as ascertained by the deed in its original state, or otherwise varies the legal effect of the instrument as
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originally expressed, or reduces to certainty some provision which was originally unascertained and as such void, or which may otherwise prejudice the party bound by the deed as originally executed."
23. The Kerala High Court in the case of Ramachandran vs. Dinesan reported in 2005(1) acquittal 531 in the similar case it was held:
"Negotiable Instruments Act,1881 - Sections 87 and 138 -
Dishonour of cheque - Conviction by Courts below - Revision - Defence plea of material alteration in cheque
- Petitioner accused was alleged to have issued cheque for Rs.1,25,000/- for repayment of loan
- Word "1" appeared to have been added subsequently and even last figure '0' was also added subsequently - Any change in a written instrument which changed legal identity or business character
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CRL.A No. 525 of 2012of instrument either in its terms or in legal relation of parties to it would be a material alteration -
Instrument would be rendered void
and no criminal prosecution could
be sustained on such cheque -
Conviction was liable to be set
aside".
24. Learned counsel for the respondent also relied upon the judgment of this Court reported in ILR 2006, Kar 3111 in the case of B. Krishna Reddy vs. B.K.Somashekara Reddy, it is held that:
"NEGOTIABLE INSTRUMENTS ACT, 1881-SECTIONS 87, 138-MATERIAL ALTERATIONS-ACCOUNT BEARING A PARTICULAR A/C NO. CLOSED-
Complainant altered the account number and presented to the bank for encashment-Bank returned the cheque with an acknowledgment "referred to the drawer". Trial Court acquitting the accused-whether proper-HELD-If the endorsee were to
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CRL.A No. 525 of 2012make an alteration, the liability of the endorsee were to make an alteration, the liability of the endorser is discharged. It is mandatory that in order to attract prosecution under Section 138 of N.I.Act there should be any debt or legal liability. In view of admitted material placed on the part of PW1, the instruments has become void in law-therefore, no acts in law under Section 138 of N.I.Act could live.
The acquittal of the accused is sound and proper.
Appeal dismissed."
25. The judgment of the Hon'ble Apex Court as well as the High Court of Kerala and judgment of this Court stated above, it is clear that when there is material alteration of the date without consent of the accused, no prosecution can be sustained against the accused. In this regard, the complainant not chosen to refer this cheque-Ex.P1 to the handwriting expert to prove the signature of
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CRL.A No. 525 of 2012the accused and also in respect of contention that there was no material alteration of the date in the cheque and complaint failed to prove the issuance of alleged date of the cheque as alleged by the complainant."
20. Further the Co-ordinate Bench of this Court in Crl.R.P.No.906/2013 dated 27.06.2022 in the case of D. Chandraiah Vs. K. Gaddigeppa, wherein this Court found that the alteration does not bear any signature of the complainant as stated in paragraph No.15 of the said judgment. The Co-Ordinate Bench of this Court discussed the definition of material alternation in M.L.Tannan's "Banking Law and Practice in India" Twenty - eighth Edition - 2021 and at paragraph Nos.17, 18 and 19 it is held as under:
"17. In M.L. Tannan's "Banking Law and Practice in India" Twenty-eighth Edition - 2021, he has defined "Material alterations" at page 950, as below:
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"An alteration is material, which in any way alters materially or substantially the operation of the instrument and the liabilities of the parties thereto, irrespective of the fact whether or not the change is prejudicial to the payee."
Apart from stating that a banker must be very careful when there is a material alteration in the cheque presented for payment and that it should see that such alteration has been made with the drawer's consent or authority and is confirmed by his signature, Tannan has also given few examples of material alterations in which the alteration of the date of the instrument with the purpose of accelerating or postponing the time of the payment comes on the top.
18. Under Section 87 of the N.I. Act, a Negotiable Instrument, which is materially altered becomes void as against any one who is a party thereto at the time of making such alteration and does not consent thereto, unless it was made in order to carry out the common intention of the original parties. Thus,
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when admittedly, the cheque at Ex.P-2 has been materially altered, by virtue of its alteration in the year of the date column, and since the same does not bear any authentication signature by its drawer, the said cheque becomes invalid from its enforcement. The statements made by PW-1 in his cross-examination admitting the counter foil of the said cheque and the correctness of the date mentioned thereafter as '13-07-2005' further supports the contention of the accused that the cheque has been materially altered.
19. In that view of the matter, without going much into the other aspects of the alleged defence of the accused, about the alleged loan of Rs.60,000/-, suffice it to say that admittedly, the cheque at Ex.P-2 is shown to be materially altered, as such, has lost its validity in the eye of law."
21. Similarly, in Crl.R.P.No.592/2019 dated 09.06.2022 in the case of Herman Castelino Vs. Dr. Suresh Kudva, the Co-ordinate Bench of this Court has considered what is the effect of alteration of negotiable
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CRL.A No. 525 of 2012instrument i.e. Ex.P1-Cheque and at paragraphs 19, 20 and 21 there is a detail discussion, which reads as under:
"19. In M.L. Tannan's Banking Law and Practice in India Twenty-eighth Edition - 2021, he has defined "Material alterations" at page 950, as below:
"An alteration is material, which in any way alters materially or substantially the operation of the instrument and the liabilities of the parties thereto, irrespective of the fact whether or not the change is prejudicial to the payee."
Apart from stating that a banker must be very careful when there is a material alteration in the cheque presented for payment and that it should see that such alteration has been made with the drawer's consent or authority and is confirmed by his signature, Tannan has also given few examples of material alterations in which the alteration of the date of the instrument with the purpose of accelerating or postponing the time of the payment comes on the top.
20. In the instant case, the alteration in the cheque at Ex.P-1 has been admitted by none else
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CRL.A No. 525 of 2012than the drawee Bank Manager in his evidence as DW-1. Though it was not elicited from him about the nature of the said alteration, however, he has identified the said alteration as an alteration in the date of the cheque. As analysed above, in the date column, the year appears to have been manipulated and appears to have been postponed the time of payment. Thus, undoubtedly, it is a material alteration in the cheque.
21. Section 87 of the N.I. Act which speaks about the effect of material alteration, states that any material alteration of a Negotiable Instrument renders the same void as against any one who is a party thereto at the time of making such alteration and does not consent thereto, unless it was made in order to carry out the common intention of the original parties.
In the instant case, there is nothing on record to show that the alteration in the date of the cheque at Ex.P-1 was made in order to carry out the common intention of the original parties. Therefore, by virtue of the material alteration being made to the date of the cheque without any authentication thereto by the drawer of the cheque, the instrument becomes void. However, the banker, even there being a material
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CRL.A No. 525 of 2012alteration in the cheque, did not proceed to mention the same as one among the reasons for returning of the cheque, but only stated that the cheque was returned for the reason of closure of the account by the drawer. As noticed above, the Bank Manager as DW-1 referring to the register maintained by them, has stated that the cheque at Ex.P-1 was returned by them by mentioning only the reason of closure of the account. He made it clear even in his cross- examination that the banker had returned the cheque only with the reason of "Account Closed", as such, he could not give any explanation as to how come the reason of 'funds insufficient' was also shown as marked with a tick '√' in the cheque return memo at Ex.P-2. However, in the cross-examination of PW-1, it was suggested that the complainant, with an intention to ensure that he would maintain a case against the accused for the offence punishable under Section 138 of the N.I. Act, manipulated the cheque return memo showing the same as returned even for the reason of insufficiency of funds. Therefore, it is clear that since the account of the drawer of the cheque was closed with the drawee Bank as on the date of the presentation of the cheque at Ex.P-
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CRL.A No. 525 of 20121, it confined the reason for returning of the cheque only to the reason of "account closed". Thus, it cannot be deduced that, had there been any material alteration in the cheque at Ex.P-1, the banker should have necessarily mentioned about the same. At the cost of repetition, it is again observed that DW-1 as a Bank Manager of the drawee Bank himself has stated that there is alteration in the date column of the cheque at Ex.P-1. Surprisingly, neither the Trial Court nor the learned Sessions Judge's Court have noticed this aspect, on the contrary, merely because there was a cheque return memo and legal notice copy, they have proceeded to hold that the guilt against the accused has been proved beyond all reasonable doubts. Had they noticed the material alteration existing in the cheque at Ex.P-1, making the instrument at Ex.P-1 void, then, they would not have proceeded to hold the accused before it guilty of the alleged offence. Since the said finding of both the Trial Court as well the learned Sessions Judge's Court holding the accused guilty of the alleged offence is now established to be a perverse and erroneous finding, the same warrants interference at the hands of this Court. Thus, without discussing the other aspect of the alleged allegation of financial
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CRL.A No. 525 of 2012incapacity of the complainant to lend such a huge sum of money to the accused, suffice it to hold that the impugned judgments of both the Courts deserve to be set aside and the accused deserves to be acquitted of the alleged offence."
22. The Co-Ordinate Bench of this Court has further held that since an account was already closed, the bank Authority has no occasion to state that cheque was materially altered.
23. Even in this case, Ex.P2-Bank endorsements at Sl.Nos.28 i.e., 'Account Closed' and Sl.No.29 i.e., 'Draft reported lost /stolen and payment stopped' are rounded off and in front of Sl.No.28 a hand written endorsement was made as 'A/c closed' by the Manager of the bank. The complainant has not examined the Manager of the bank, when the notice is issued about closing the account long back. Therefore, in view of defence evidence led by the accused, in my considered
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CRL.A No. 525 of 2012view, the accused has successfully rebutted the presumption if any arising in favour of the complaint.
24. On the other hand, the complainant has failed to discharge the burden shifted on him. The Trial Court after considering both oral and documentary evidence, has come to a conclusion that the complainant is not entitled for the reliefs as sought for and complaint has failed to prove the existence of legally enforceable debt. Though certain findings of the Trial Court may not be correct, ultimately the result of the judgment cannot be said that either perverse, illegal or erroneous. Therefore, this Court being a First Appellate Court where there is nothing to show that the judgment of the Trial Court is perverse or it is erroneous and it has resulted in a miscarriage of justice, will not interfere. I do not find any grounds to interfere with the judgment of acquittal.
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CRL.A No. 525 of 2012
25. Accordingly, I pass the following:
:ORDER:
a) The appeal is hereby dismissed.
b) The judgment of acquittal passed in C.C.No.8095/2006 by the XVIII ACMM and XX Additional Small Causes Judge, Bengaluru dated 07.03.2012 is hereby confirmed.
c) Bail bonds, if any executed by the accused shall stand cancelled.
d) The Registry is directed to send back the records to the trial Court.
e) No order as to costs.
Sd/-
JUDGE HJ/KTY List No.: 1 Sl No.: 28