Kerala High Court
K.S.Rajesh vs K.M.Basheer on 25 May, 2017
Author: Alexander Thomas
Bench: Alexander Thomas
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS
THURSDAY, THE 25TH DAY OF MAY 2017/4TH JYAISHTA, 1939
Crl.Rev.Pet.No. 600 of 2017 ()
-------------------------------
CRA. 297/2015 OF ADDL. DISTRICT & SESSIONS COURT - II, NORTH
PARAVUR
CC. 118/2012 OF J.M.F.C. - II, PERUMBAVOOR
----
REVISION PETITIONER(S)/APPELLANT/ACCUSED:
----------------------------------------
K.S.RAJESH,
AGED 48 YEARS, S/O.SIVAN,
DRIVER, KUZHIYALAPARAMBIL,
MAROTTIKAVALA, VELLARA, METHALA P.O.,
PERUMBAVOOR, ERNAKULAM DISTRICT, PIN-683545,
PERMANENTLY RESIDES AT 1/184A,
THAZHATHUMANACKAL HOUSE,
METHALA P.O., ASAMANNOOR, KUNNATHUNADU TALUK,
ERNAKULAM, PIN-683545.
BY ADVS.SRI.CARLTON THOMAS
SRI.SOBHAN GEORGE
RESPONDENT(S)/RESPONDENTS/APPELLANTS/COMPLAINANT & STATE:
---------------------------------------------------------
1. K.M.BASHEER,
AGED 55 YEARS, S/O.MUHAMMED,
KARAVATT HOUSE,
PERUMBAVOOR, ERNAKULAM DISTRICT, PIN-683542.
2. STATE OF KERALA,
REPRESENTED BY THE PUBLIC PROSECUTOR,
HIGH COURT OF KERALA, ERNAKULAM-682031.
R2 BY PUBLIC PROSECUTOR SRI.SAIGI JACOB PALATTY
THIS CRIMINAL REVISION PETITION HAVING COME UP FOR
ADMISSION ON 25-05-2017, THE COURT ON THE SAME DAY
PASSED THE FOLLOWING:
SKG
ALEXANDER THOMAS, J. CR
----------------------------
Crl.R.P.No.600 of 2017
----------------------------
Dated this the 25th day of May, 2017
ORDER
The petitioner is the accused for offence punishable under Section 138 of the NI Act in C.C.No.118 of 2012 on the file of the Judicial First Class Magistrate Court-II, Perumbavoor instituted on the basis of a complaint filed by the 1st respondent herein. The trial court as per the impugned judgment rendered on 29.6.2015 has convicted the accused and sentenced him to undergo simple imprisonment till the rising of the court and to pay compensation of Rs.1.5 lakhs (which is the amount covered by the dishonoured cheque) to the complainant as compensation in terms of Section 357(3) of Cr.P.C and in default to pay compensation, the accused have to undergo simple imprisonment for a period of three months. The petitioner has challenged the same by filing Crl.A.No.297 of 2015 before the Court of Additional Sessions Judge, N.Paravur. The appellate court as to the impugned judgment rendered on 28.02.2017 has dismissed the appeal and has thereby Crl.R.P.No.600 of 2017 2 confirmed the impugned conviction and sentence. Challenging the concurrent verdicts of both the court below the petitioner preferred this Criminal Revision petition by taking recourse to the remedies available under Sections 397 and 401 of Cr.P.C.
2. Heard Sri.Carlton Thomas, learned counsel appearing for the revision petitioner(accused)and Sri.Saigi Jacob Paletty, learned Public Prosecutor appearing for R2 State. In the nature of the orders proposed to be passed in this petition, notice to R1 (complainant) will stand dispensed with.
3. The gist of the allegation of the complaint is that the complainant and accused were on friendly terms and that the accused had requested the complainant to advance an amount of Rs.1.5 lakhs as his personal loan for a period of six months and on this basis the accused had borrowed the said amount of Rs.1.5 lakhs from the complainant on 27.9.2009 and after the expiry of the agreed period, the complainant had demanded back the amount upon which the accused had executed and issued Ext.P1 cheque dated 29.01.2010 for and amount of Rs.1.5 lakhs. The cheque when presented for encashment was returned by the bank with the endorsement "No account, account closed". Thereupon the complainant had issued Ext.P4 Crl.R.P.No.600 of 2017 3 statutory demand notice dated 9.3.2010 calling upon the accused to pay the above said amount covered by the dishonoured cheque within 15 days. Though the said notice was duly served on the accused, he had not issued any reply and that he had not repaid the amount etc. On this basis petitioner after complying with the formalities like application complaint which has lead to the file in question.
4. During the trial the complainant was examined as PW1 and PW2(Bank Manager)entered and Exts P1 to P8 were marked on the side of the prosecution. The defence have examined as D.Ws 1 to 3 (out of which DW3 is the accused). Exts D1 and D2 documents were also marked on behalf of the defence. X1 is the court exhibit.
5. PW1 has deposed broadly in terms of the contents of his complaint. By confronting PW1, the suggestion of the defence was that there was no such account with the bank as alleged by the complainant and that the signature seen in Ext. P1 cheque does not belong to the accused and further that the accused has not borrowed any amount from the complainant and that the complaint has falsely filed this case etc. Yet another contention raised by the defence is that the accused Crl.R.P.No.600 of 2017 4 had not received the statutory demand notice as provided under Sec.138 proviso (b) of the NI Act and that the address shown in the complaint is not his address. Later, defence has also put forward altogether a new case at the time of the examination of the accused as DW3 that he had handed over three blank signed cheques including Ext.P1 cheque to one of his friend, one T.R. Sivadasan, in connection with the purchase of a vehicle as security and that Ext.P1 cheque has later been misused by the complainant etc.
6. Even though PW1(complainant) was intensely cross examined, the trial court has specifically noted that he has stood unshaken and has clearly deposed that the accused given ExtP1 cheque in the presence of the complainant. Later on when the accused was examined as DW3, he has deposed in his chief examination that he had an account with the Federal Bank, Keezhillam branch and that Ext.P1 was issued to that account and he has further admitted his signature in Ext.P1.
7. As regards the allegation regarding service of notice in the wrong address etc. the trial court has extensively discussed various materials that has come on record to show Crl.R.P.No.600 of 2017 5 that the said plea of the accused is patently untenable. Ext.P6 is the acknowledgment card, wherein the accused has appended his signature acknowledging the receipt of the Ext.P4, demand notice. Ext.P7 is the bail application filed by the accused and Ext.P8 is the vakalath filed by the accused before the trial court and the trial court found that both in Ext.P7 bail application as well as in Ext.P8, vakalath, the address of the accused is the same as one shown in the complaint as well as in the statutory demand notice issued to the accused. Ext.X1 (court exhibit) is the extract of statements of account maintained by the accused with the Federal Bank which shows that his address is more or less the same as the one shown in the complaint and the demand notice etc. The accused even went to the extend of being ignorant about expansion of one of the initial 'K' of his name K.S.Rajesh and the attempt was to show that his family house name is not Kuzhiyalaparambil house. The trial court has clearly commented that the said approach of the accused is only to deliberately feign ignorance raised in support of his contention that the notice is sent in the wrong address. Thus the trial court has rightly placed reliance on the decision of Crl.R.P.No.600 of 2017 6 Bombay High Court in Vasco Urban Co-operative Credit Society vs. Shobha D korgaonkar (2005 Criminal Law Journal 2465) which reads as follows:
" As rightly observed by Apex Court in the case of K.Bhaskaran v. Sankaran Vaidyan Balan (1999 Crl.Law Journal 4606)(Supra) Any other interpretation can lead to a very tenuous position as the drawer of the cheque who is liable to pay the amount would resorte to the strategy of subterfuge by successfully avoiding the notice. It also cannot be ruled out that a cunning accused person may just scribble something on the A/D card and not his real signature with a view to take a plea that such a notice was not received by the accused and this also cannot be ruled out in the case at hand".
8. In the light of all these aspects the trial court has finally come to the conclusion that the plea of the accused regarding service of notice in the wrong address is absolutely wrong and that the demand notice has been duly and properly served on him.
9. As far as the other contention raised by the accused that the Ext.P1 cheque was actually given by him to one of his friends, one Sri.T.R.Sivadasan, the trial court has given strong reasons to disbelieve the said contention. For advancing the said contention the accused has placed reliance on the depositions of DW1 and DW2. DW1 has also inter alia deposed in his cross examination that he does not do the transaction in between the complainant and the accused. The trial court has Crl.R.P.No.600 of 2017 7 found reasons to discard the evidence of DW1 and that his evidence is not believable or credible that Ext.P1 cheque was handed over by the accused to Sri. Sivadasan. As far as the evidence of DW2, he has clearly deposed that he has no direct knowledge with respect to the alleged transactions and the trial court has rightly held that the evidence of DW2 is only to be discarded as hearsay evidence.
10. During the course of arguments Sri.Carlton Thomas, learned counsel for the revision petitioner(accused) would strongly contend that even in Ext.P2 cheque return memo issued by the IDBI Bank it has been clearly contained the endorsement, "no account, account closed" and further placed reliance on the judgments of this court in Muralidharan.V v. V.A.Kumaran and Another reported in 2016(3)KHC 845. In the said judgment dated 05.07.2016 it has been, inter alia, held that for the bank account in question where the account has been closed prior to the drawal of the cheque, then no offence under Section 138 of the Negotiable Instruments Act could be made out and only offence under Sec.420 of IPC is made out. Reference may be made out to Paras 14,15,16 and 19 of the judgment of this Court in 2016(3)KHC 845 which Crl.R.P.No.600 of 2017 8 reads as follows:
" 14. There is apparent distinction between a situation wherein a person after issuing a cheque to another, closes that account, and a situation wherein a person after closing the account with the bank, manages to issue a cheque to another from that account he had already closed. In the former, apart from the fact that it may invite another offence, it would certainly be an offence under Section 138 of the NI Act.
15. The latter situation deals with two totally different situations. Firstly, the account is being closed by the bank on the demand of the account holder himself and thereafter the account holder manages to issue a cheque to another from that account he had already closed. Secondly, the bank on its own volition closes the account by itself, without the knowledge and consent of the account holder; say for example, by treating the account as a non-performing account, and without the knowledge that the account was closed by the bank, the account holder issues a cheque to another from that account. In the case covered by firstly as aforesaid, it would be the offence of cheating, since the cheque was intentionally issued to the payee to cheat him with the knowledge that there was no live account. In that case, it would not be an offence under Section 138 of the NI Act, since there was no live account at the time when the cheque is issued. In the case covered by secondly as aforesaid, it would not be an offence of cheating, since the cheque was issued bona fide by believing that the account remained alive: whereas, the dishonour of that cheque would invite an offence under Section 138 of the NI Act.
16. The trial Court ought to have applied its mind to the facts narrated in the complaint. Had the complaint been at least properly perused, definitely, the Trial Court would have taken cognizance of the offence under Section 138 of the Negotiable Instruments Act, after recording the sworn statement of the complainant.
19. It is true that this is a case wherein the account maintained by the 1st respondent was closed by the Bankers themselves, without the knowledge and consent of the account holder, the accused. When the account was closed without the knowledge and consent of the account holder, definitely, an offence under Section 138 of the Negotiable Instruments Act can be attracted. Even if the accused had issued the cheque and thereafter closed the account, it could be treated that the account holder did not want to continue with the account and to keep any money in his account so that he got back the entire amount from his account and closed the account. In either case, the offence under Section 138 of the Negotiable Instruments Act could be attracted."
11. On this basis, Sri.Carlton Thomas, learned counsel appearing for the revision petitioner strongly contend that Crl.R.P.No.600 of 2017 9 since it has been borne out even by the documents relied on by the prosecution that the account itself was closed prior to the drawal of the cheque then offence under Section 138 of the Negotiable Instruments Act cannot be said to be made out etc. It is also contended that the burden to prove as to whether or not the account was closed prior to the drawal of the cheque cannot be lawfully cast on the accused, as in a situation of the account being closed prior to the drawal of the cheque, it will amount to compelling the accused to adduce evidence so as to incriminate him for offence under Sec.420 of the I.P.C. and therefore casting such a burden on the accused would be compelling him to incriminate himself in a criminal offence, which has been barred and prohibited by virtue of the provisions engrafted in Clause (2) of Article 20 of the Constitution of India. That Article 20 of the Constitution is a fundamental right guaranteeing protection against self- incrimination in criminal proceedings, etc. Hence, it is also contended by the petitioner that the burden to prove the crucial factual issue as to whether or not the bank account was closed prior to or after the drawal of the dishonoured cheque, is solely and fully on the complainant and that, in the instant Crl.R.P.No.600 of 2017 10 case, since the complainant has not proved that crucial factual issue, it would lead to the throwing out of the complaint, which entitles the acquittal of the accused on that ground alone.
12. In this regard it is relevant to note that a Division Bench of this Court in the judgment rendered on 16.07.2003 in Vathsan v. Japahari reported in 2003(3)KLT 972 has held that when a person draws a cheque, he will believe that in no case the cheque will be dishonoured that therefore such a defence is not allowed as per Sec.140 of the Negotiable Instruments Act and therefore once a person has issued a cheque drawn on account which he was holding with the Bank he cannot take up a defence that he did not have a subsisting account on the date of drawal of the cheque and if such a plea is permitted, it will undoubtedly defeat the very intend and objective behind S.140 of the Negotiable Instruments Act and that situations where cheques have been issued against the account, which has been closed prior to the date of drawal of the cheques, shall also come within the fold of S.138 of the Negotiable Instruments Act to attract criminal liability. Reference may be made to paras 5 & 6 of the above said judgment which reads as follows:
Crl.R.P.No.600 of 2017 11
"5. S.140 reads as follows:
"140. Defence which may not be allowed in any prosecution under S.138.-" It shall not be a defence in a prosecution for an offence under S.138 that the drawer had no reason to believe when he is issued the cheque that the cheque may be dishonoured on presentment for the reasons stated in that section."
This makes it clear that when a person draws a cheque, he will believe that the cheque will, in no case, be dishonoured. Therefore, such a defence is not allowed as per S.140 of the Act. Therefore, we are of the view that once a person had issued a cheque drawn on an account, which he was holding in the bank, necessarily, he cannot take up a defence that he did not have a subsisting account on the date of drawal of the cheque. It will, if permitted, undoubtedly, defeat the intent behind S.140 of the Act.
6. So, we are of the view that situations where cheques have been issued against the account, which has been closed prior to the date of drawal of the cheques, shall also come within the fold of S.138 of the Act to attract criminal liability. The reference is answered accordingly. Parties are free to agitate their case based on the respective contentions available to them, subject to the law laid down as above.
13. So also learned Single Judge of this Court in the judgment dated 26/11/2015 in Cr.A.No.673/2004 in the case Bhaskaran.T and others v. M.P.Mohandas and another reported in 2016(1) KHC 254 = 2016(1)KLD 156, has held in para 10 thereof that even if a cheque is issued against an account which was closed prior to the drawal of the cheque, it comes with the fold of Section 138 of the Negotiable Instruments Act. Para 10 of the said judgment of this Court reported in 2016(1) KHC 254 reads as follows:
"10. But the Court below had relied on the decision reported in Joseph's case (cited supra) and came to the conclusion that since the account was closed, the offence under Section 138 will not lie and on that basis acquitted the accused. But the dictum laid down in that decision was overruled by the Division Bench of this Court in Vathsan's case (cited supra) and it has been held that even if a cheque is issued against an account which has been closed prior to Crl.R.P.No.600 of 2017 12 the drawal of the cheque, it comes with the fold of Section 138 of the Act. The same view has been reiterated in the decision reported in Salims case (cited supra). Further in the decision reported in Lakshmi dyechem v. State of Gujarath and Others, 2012(4)KHC 826 (SC), the Hon'ble Supreme Court has held that even if the cheque was returned for any of the reasons such as "account closed, payment stopped, refer to drawer signature does not match," in each of such case offence under Section 138 of the Act will be attracted.
So the reasonings given by the Court below for acquittal of the accused relying on Joseph's case (cited supra), which has been overruled by this Court in the subsequent decision and also in view of the decision of the Supreme Court mentioned above is unsustainable in law and the same is liable to be set aside. I do so."
14. More importantly it is to be noted that the Apex Court in Laxmi Dyechem v. State of Gujarat and others reported in (2012) 13 SCC 375 has held that even when a cheque is returned for any other reasons such as "account closed, payment stopped, refer to drawer, signature does not match", etc., in each case Sec.138 of the Negotiable Instruments Act will be attracted and that insufficiency of funds as envisaged in Sec.138 of the NI Act is a genus and dishonour for reason of "accounts closed", "payment stopped", "referred to drawer,"
etc are only species of that genus, etc. Therefore it appears that the judgment dated 5/7/2016 of a learned Single Judge of this Court in Muralidharan.V v. V.A.Kumaran and Another (2016(3)KHC 845) has been rendered without taking into account the afore cited decisions of the Division Bench and Single Bench of this Court, on the above said point. So the above said later judgment rendered on 5/07/2016 by the Crl.R.P.No.600 of 2017 13 learned Single Judge in Muralidharan's case reported in 2016 (3)KHC 845 does not reflect the correct legal position, to the limited extent that Sec.138 offence is not attracted, where the bank account is closed prior to the drawal of the cheque, inasmuch as it has not reckoned the earlier judgments of the Division Bench and that of the learned Single Judge referred to hereinabove, on the said point. In this view of the matter, this Court is constrained to overrule the above said contentions raised by Sri. Carlton Thomas, learned Counsel appearing for the revision petitioner(accused), that offence under Sec.138 of the NI Act is not made out in the facts of this case.
15. The above said findings and reasons given by the trial court has been confirmed by the appellate court. The above said findings on facts regarding the conviction of the petitioner cannot be said to be tainted by gross perversity or unreasonableness. The learned Counsel for the petitioner has not been able to successfully establish before this Court that the impugned judgments of both the court below are in any manner vitiated by grave illegality or impropriety. Therefore this Court finds that no grounds had been made out for invoking the revisional jurisdiction of this Court so as to Crl.R.P.No.600 of 2017 14 interfere with the impugned facts and findings regarding the conviction in this case.
16. The trial court has clearly found that the evidence given by PW1 is believable and credible and that he has proved the transaction and further that the suggestions and contentions raised by the defence are not tenable or sustainable. As regards the question of sentence it is to be noted that the amount covered by the dishonoured cheque is Rs.1.5 lakhs and the courts below have imposed sentence of imprisonment only till the rising of the court and to pay compensation of Rs.1.5 lakhs with the default clause of imprisonment for 3 months. The said conviction cannot be said to be disproportionate or excessive. Therefore this Court is not in a position of interfere with the said sentence imposed in this case.
17. Sri.Carlton Thomas, learned counsel appearing for the revision petitioner would submit that in case this Court is so inclined to afford the impugned convictions and sentence in this case, then this court may grant sufficient time to the petitioner to pay the compensation amount of Rs. 1.5 lakhs and would seek at least six months time in that regard. It is Crl.R.P.No.600 of 2017 15 also urged by the counsel for the petitioner that the petitioner is driver by avocation and that he does not have sufficient means to pay off the entire amount of Rs.1.5 lakhs in a short time.
In the light of the above said submissions the following orders are passed:
(i) The impugned conviction, sentence and compensation imposed on the petitioner for the offence punishable under Section 138 of the Negotiable Instruments Act in this case are confirmed.
(ii) The petitioner is given six months time from 1.6.2017 to pay the compensation amount of Rs.1,50,000/- to the complainant. In this regard the petitioner will be at liberty to pay the above said amounts in various instalments to the 1st respondent(complainant) so that the total amount of Rs.1,50,000/- (Rupees One lakh fifty thousand only) will be paid within the above said time limit. On receiving such payments the complainant will issue necessary receipts evidencing such payment to the petitioner so as to enable the petitioner to produce the same before the trial court to satisfy the said court about such payments.
(iii) The petitioner will appear personally before the trial court at 11 a.m on 1.12.2017 to suffer the sentence of imprisonment till rising of the court and to satisfy the trial court about the payment of the amount. Needless to say on default of the petitioner to pay the said compensation amount, the petitioner will have to suffer simple imprisonment for a period of four months as ordered by the appellate court.
(iv) Until 1.12.2017 all further coercive steps that may be taken against the petitioner for execution of the impugned sentence in this case will stand deferred.
(v) On default of the petitioner either to appear before the trial court on 1.12.2017 or on his default to pay the above said amount, the trial court will be at liberty to proceed against the petitioner in accordance with law.
Crl.R.P.No.600 of 2017 16 With these observations and directions the Criminal Revision Petition stands finally disposed of.
Sd/-
ALEXANDER THOMAS JUDGE //True Copy\\ P.A to Judge IAP