Andhra HC (Pre-Telangana)
Andhra Engineering Corporation, ... vs Tci Finance Ltd., Secunderabad And ... on 13 April, 1999
Equivalent citations: 1999(3)ALD393, 1999(1)ALD(CRI)676
Author: K.B. Siddappa
Bench: K.B. Siddappa
JUDGMENT
1. This Revision is filed against the judgment and sentence passed in Crl. A No.91/98 on the file of VI Additional Metropolitan Sessions Judge, Hyderabad.
2. The case arises under Section 138 of Negotiable Instruments Act. Admittedly the petitioner/accused approached the complainant/lst respondent for Bill Discounting facility by entering into agreement in the month of July 1995. The petitioner availed the Bill Discounting facility amounting to Rs.10,76,426.25 ps. The petitioner signed the Hundi and submitted invoices along with his covering letter. The petitioner had to repay the Bill Discounting amount within 90 days from the period of borrowal. The due date was 28-10-1995. However, he did not repay the amount. The petitioner issued Ex.PS, which is the cheque in his case, dated 28-10-1995 for an amount of Rs.10,76,000/ -. Subsequent to the issuance of the cheque, -an amount of Rs.2,00,000/- was paid in the month of November 1995. Again in the month of February 1996 the petitioner paid Rs.50,000/-. On 23-2-1996, a further amount of Rs.1821/- was paid. In all, the petitioner paid Rs.3,01,821/-. PWl who is authorised to file the complaint stated thai the cheque issued by the petitioner was presented on 18-3-1996. But it was returned for insufficient funds. The complainant is used legal notice Ex.PIO dated 30-3-1996. The petitioner gave reply Bx.PH, dated 14-4-1996 denying the transaction. Thereafter, the complainant/ 1 st respondent wrote letters to the petitioner to pay the amount. Exs.P6 and P7 are the office copies of the said letters. They demanded an amount of Rs.8,76,000/-, which was the balance as on that day. No reply was given to these letters by the petitioner. Subsequently, some amount also was paid by the petitioner. There is no dispute that an amount of Rs.3,50,000/--was paid and a balance of Rs.7,74,179/- was due from the petitioner7accused. The liability of this amount is not seriously disputed in this revision. The lower appellate Court discussed about these facts in detail.
3. Mr. T. Ball Reddy, the learned senior Counsel appearing for the revision petitioner/accused submitted that the cheque Ex.PS, was for an amount of Rs. 10,76,000/-. Admittedly, the petitioner has paid some amounts. The cheque was presented on 18-3-1996 for the entire amount. Admittedly, the petitioner has paid Rs.3,50,000/- already. Therefore, Ex.PS cheque, to this extent, is invalid. The original cheque issued for Rs.10,76,000/- cannot be presented to realise the balance of Rs.7,74,179/-which is admittedly due on the date of presentation of the cheque. Therefore, if the cheque bounced, no liability can be fastened to the petitioner/accused.
4. In support of his contention a strong reliance is placed by the learned Counsel for the petitioner on the judgment of Calcutta High Court in Gopa Debt Ozha v. Sujit Paul, 1995 Crl.LJ 34!2. In that case, in the notice an amount of Rs.6,50,000/- was claimed. However, the complaint was made for a sum of Rs.5,79,000/-. In those circumstances, the learned Judge held that the difference will create difficulty to the drawee to know how much amount he has to pay or she has to pay, as the case may be, and that makes the notice insufficient and vague and the notice will become illegal.
5. For the same purpose, he also relied upon another Judgment of Calcutta High Court in N.C. Nag Pal v. The Stale, 1979 Crl.LJ 998. In that case, it was observed that nothing was indicated in the notice as to how the amount amounted to Rs.6,50,000/-. In those circumstances, the Court held "28. So the wording in clause (b) to the proviso of Section 138 "a demand for payment of the said amount of money by giving notice, in writing, to the drawer of the cheque", refers to the cheque amount and not any other amount either smaller of higher than the amount mentioned in the cheque."
6. In the case N.C, Nag Pal v. The State, (supra) and in Raj v. Rajan, 1997 (1) ALT (Crl.) 359, of Kerala High Court, unspecified interest was added to the cheque amount and notice was issued. In those circumstances, the notice was held to be illegal and consequently the High Court upheld the acquittal. As a matter of fact, these two judgments were cited before the lower appellate Court in the case on hand. The lower appellate court rightly held that the notices in those cases were held illegal because of uncertainty and unexplained increase in the amount demanded in the notices, adding unspecified interest in the case Raj v. Rajan, (supra). The lower appellate Court rightly declined to rely upon those Judgments. The reasons given are quite cogent.
7. The learned senior Counsel Mr. T. Ball Reddy also relied upon the judgment of this Court in Voruganti Chinna Gopaiah v. Godavari Fertilizers and Chemicals and another, . In that case, the accused fell in arrears to the tune of Rs.10,99,899.90. The accused gave cheque for the said amount on 5-10-1991. The cheque was presented on the same day and it was returned by the State Bank of Hyderabad with the endorsement "funds insufficient". The complainant gave a Phonogram to Al asking him to arrange a draft for the same. A letter was also written by the complainant. It was also acknowledged on 1-11-1991. Inspite of that, the amount was not arranged. Subsequently, an agreement (Ex.DI) was entered into. According to that agreement, the complainant agreed to receive the amount in three instalments. PW1 categorically admitted that the accused need not pay the amount in lumpsum and that they have no right to proceed against the accused. In the cross-examination he admitted the execution of Ex.DI. The Head Office has stated that as per the terms under taken by the accused, the accused were to pay the entire amount in four instalments and that a sum of Rs.2,71,029.12 is payable on or before 31-12-1991 towards the first instalment. Therefore the parties had entered into agreement (Ex.DI) subsequent to the issuance of the cheque. In those circumstances this Court held that as on the date of presentation of the cheque originally given, Ex.DI was occupying the field and the parties are bound by the agreement. The subsequent action shall depend upon the terms of the agreement. It was also held that when the complaint was given there was no cause of action for the complainant to rely upon Ex.Pl cheque.
8. The Chinna Gopuiah case (supra) is quite distinguishable on facts. In the case on hand there is no such agreement like Ex.Dl. After issuance of the cheque, an amount of Rs.3,50,000/- was paid on various dates. That does not mean that the complainant agreed to receive the amount in instalments. The cause of action docs not shift from the issuance of cheque Ex.PS in this case. Thai being the case, no reliance can be placed on the above judgment.
9. Another judgment of this Court in M/s. Padmaja Marketing Enterprises v. V.S.R. Murthy and others, 1997 (1) ALD (Crl.) 814 (AP), is brought to my notice, the facts of which are similar. But the actual point was not decided. Therefore the matter was remanded to the lower Court setting aside the acquittal recorded by the Magistrate. In that case, the amount due on a Kalha was Rs.44, 117/-. The accused issued Cheque for Rs. 10,000/- on 6-4-1991. The accused paid an amount of Rs.5,500/-to the representative of the complainant on 16-4-1991 by way of a Demand Draft. The cheque was actually presented for encashment and the same was returned on 14-8-1991 with an endorsement "insufficiency of funds". Thereafter, a legal notice was issued. No reply was given by the accused. Then the complaint was lodged. Subsequently, another sum of Rs.5000/-was given in cash on 21-9-1991. The second payment was after filing of the complaint. The accused pleaded discharge of the debt. The trial Court accepted the plea and recorded acquittal. This finding was reversed and the matter was remanded. The learned Judge took into consideration the total amount of Rs.44,117/- as due on 31-3-1991. The learned Judge also took into consideration that even after adjusting the two amounts i.e., Rs.5,500/- and Rs.5000/-, still the accused was liable to pay nearly an amount of Rs.34,000/-. It was held that as along a there is legally enforceable liability either on the date of issuance of cheque or on the date of encashment of cheque, the complainant is entitled to encash the cheque issued by the accused. The cheque was given admittedly for an amount of Rs.10,000/-. The dishonour of that cheque was in question. The balance of enforceable debt i.e., Rs.44,117/- (-) Rs. 10,000/- = Rs.34,117/-, is not the subject matter of the complaint. The Court is concerned whether the cheque issued for Rs. 10,000/- was arranged for or not.
10. There is no decision on Ihe point that arises in the case on hand. The question that to be answered in this case is whether the cheque issued for Rs. 10,76,000/- could be presented even after receiving part of the amount due i.e., Rs.3,50,000/-, and if any offence is committed if that original cheque bounced for lack of sufficient funs. There is no answer to this question in the Judgment referred (5) above. Therefore, that decision does not come to the aid of the petitioner/accused.
11. The learned Counsel for the complainant relied upon the Judgment of this Court in G.L. Modi and another v. Xedd Finance & Investments Pvt. Ltd. and others, . In that case, notice was issued calling upon the accused to pay the cheque amount along with interest at the rate of 24% per annum. The learned Judge held that the notice cannot be said to be bad on the ground that the interest is also claimed in the complaint. In that case, the claim was specific rate of interest. There was no ambiguity in respect of the amount. This prompted the learned Judge to hold "............. the amount claimed towards interest would be superfluous one and the drawer of the cheque could have complied with the demand for the cheque amount alone by paying the same and refusing to pay the amount towards interest claimed in the notice. For this proposition the learned Judge relied upon the Judgment of Madras High Court in S. Venu v. N.C. Corporation, All India Criminal Reporter 1994 (2) Madras 644.
12. I have already held that the notices issued in the cases cited (1), (2) and (3) supra of Calcutta High Court and Kerala High Court, were ambiguous with respect to the amount claimed. In those circumstances the Courts held that the notices were .not valid.
13. In the ease on hand it is true that Bx.PS cheque was for an amount of Rs. 10,76,000/-. Admittedly, Rs.3,50,000/-was paid subsequently. In the notice, the balance amount of Rs.7,74,179/- only was claimed. There is no ambiguity in respect of ihe "said amount of money". The cheque was valid for an amount of Rs.7,74,179/-. Atlcast this amount was not in the account of the petitioner/accused in the Bank. The complainant filed application under Section 311 Cr.PC to issue summons to the Banker to know whether the petitioner/ accused was having any amount in his account in the Bank. The petitioner/ accused filed a Memo staling that he was having less than Rs.7,74,179/- to the credit of his account on the dale of presentation of the cheque. The Memo was withdrawn by the complainant. This being the case, it cannot be said that no offence is made out against the petitioner/accused. It would have been another case, if atleast the petitioner/accused had an amount of Rs.7,74,179/- to the credit of his account on the date of presentation of the cheque. It is not the case admittedly. Therefore, certainly the petitioner/accused is guilty of the offence punishable under Section 138 of Negotiable Instruments Act. Both the Courts below rightly held so. The accused is a Company. There is no question of convicting the Company. Therefore, the substantive sentence of imprisonment is set-aside. Considering the circumstances of the case, the fine imposed is also very heavy. In these circumstances, I reduce the fine amount to Rs.10,000/- (Rs. Ten thousand only).
14. With the above modification, the Criminal Revision Case is disposed of.