Andhra HC (Pre-Telangana)
M. Chandrashekar Rao vs V. Kutamba Rao And Anr. on 27 October, 2005
Equivalent citations: 2006CRILJ1399, 2006 CRI. L. J. 1399, 2006 (4) AKAR (EE) 491 (AP), 2006 (3) ALL LJ NOC 617, 2006 (3) ABR (NOC) 500 (AP), (2006) 2 RECCRIR 439, (2006) 1 ALD(CRL) 110, (2006) 4 ALLCRILR 382, (2006) 1 ANDHLT(CRI) 309, 2006 (3) ALLMR (JS) 7
JUDGMENT P. Lakshmana Reddy, J.
1. This is an appeal filed against the acquittal recorded by the V Matropolitan Magistrate, Hyderabad in C.C. No. 737 of 1999, dated 13-1-2004 acquitting the respondent-accused.
2. The appellant herein is the complainant and the first respondent herein is the accused in C.C. No. 737 of 1999 and therefore they will be referred hereinafter in this judgment as appellant and accused respectively.
3. The relevant facts in brief are as follows :
The complainant filed complaint before the V Matropolitan Magistrate, Hyderabad against the accused alleging that the accused was running Chit Fund Company in the name of Swapna Chits and Finance Private Limited at Ameerpet, Hyderabad in the name of his brother Sri V. Satyanarayana who is the Executive Director and one G. S. Reddy was the Managing Director and at the instance of the accused, the complainant joined as subscriber in various chits and when chit amounts were due in the above chits the accused took those amounts and further the accused also borrowed an amount of Rs. 2 lakhs in cash from the complainant and thus the accused took a loan of Rs. 5 lakhs from the complainant and executed two promissory notes dated 15-8-1999 for Rs. 3 lakhs each promising to repay the same with interest at 24% per annum. When the complainant demanded the accused for repayment, the accused gave five post dated cheques on his banker Prudential Co-operative Bank Limited, Ameerpet, Hyderabad towards part payment and the said cheques are bearing No. 7242752 for Rs. 38,250/-, 7242753 for Rs. 37,800/-, 7242754 for Rs. 37,350/-, 7242755 for Rs. 36,900/- and 7242756 for Rs. 36,450/-. Thus, for a total amount of Rs. 1,86,750/-five post dated cheques were issued. The complainant presented all the five cheques in his banker, Kanyakapararneswari Bank, Kukatpally, Hyderabad on 8-9-1999 for realization of the said amount. But, the said cheques were returned unpaid by the banker vide memo dated 9-9-1999 with an endorsement 'insufficient funds'. Thereafter, the same was informed to the omplainant by his banker vide letter dated 15-9-1999. On receipt of the information about the dishonour of cheques, the complainant got issued a legal notice dated 27-9-1999 to the accused demanding to repay the amount due under the cheques and served the same on the accused on 8-10-1999 personally. In spite of service of notice, the accused failed to make payment of the amounts due under the cheques and thereby the accused rendered himself liable for punishment under Section 138 of the Negotiable Instruments Act.
4. On the said allegations, the learned Magistrate took the case on file and issued process to the accused and after his appearance furnished all copies of documents proposed to be relied on by the complainant and examined the accused under Section 251 Cr. P.C. and the accused pleaded not guilty of the offence punishable under Section 138 of the Negotiable Instruments Act and claimed to be tried. The learned Magistrate conducted the trial during which the complainant examined himself as PW-1 besides examining one witness as PW-2 and exhibited Exs. P-1 to P-15. On the other hand, the accused examined himself as DW-1 and exhibited three documents as Exs : D-1 to D-3. Considering the evidence adduced on behalf of both parties, the learned Magistrate found that it is a case where the cheques in dispute along with 15 other cheques were obtained from the accused forcibly for a sum of Rs. 5.5 lakhs and that the legal notice Ex. P-7 is not in accordance with law and is invalid under law and therefore the accused is entitled for benefit of doubt. The learned Magistrate came to the conclusion that the prosecution failed to establish the guilt of the accused beyond all reasonable doubt for the offence punishable under Section 138 of the Negotiable Instruments Act. On such findings, the learned Magistrate acquitted the accused under Section 255(1) Cr. P.C.
5. Aggrieved by the said acquittal, the complainant preferred the present appeal contending that the order of the learned Magistrate is against law, weight of evidence and probabilities of the case and the learned Magistrate erred in acquitting the accused for the offence punishable under Section 138 of the Negotiable Instruments Act. The learned Magistrate having held that there was legally enforceable debt or liability and having observed that the decree of the civil Court is binding on the accused, the learned Magistrate erred in acquitting the accused. The learned Magistrate failed to note the presumption under Section 139 of the Negotiable Instruments Act. The learned Magistrate failed to see that merely because one of the cheques Ex. P-5 was presented two days in advance, the entire case cannot be thrown out on that ground. The learned Magistrate should have seen that the bank could not have accepted the cheque Ex. P-5 on 8-9-1999 but should have retained it till 10-9-1999. The learned Magistrate failed to note that the other four cheques were also dishonoured for want of insufficient funds. The learned Magistrate also erred in thinking that the legal notice demanding for higher amount is not valid in law. The learned Magistrate failed to see that since the bank returned all the cheques for insufficient funds, the legal notice was given for the amounts covered by the dishonoured cheques. The learned Magistrate failed to note that PW-1 made a statement that he was given 20 cheques out of confusion. The learned Magistrate failed to realize that it is the case of the accused that the pronotes and cheques were taken forcibly in the police station and such a plea was taken before the District Court in the civil suit and the same was negatived and therefore it is not open for the Magistrate to ignore the findings of the Civil Court in respect of the same subject matter in dispute. It is further submitted in the grounds of appeal that the learned Magistrate has given inconsistent findings though the Magistrate held that the pronotes were true and enforceable and when the suit was decreed the finding that the cheques were obtained forcibly cannot stand. The complainant prayed for setting aside the acquittal and to punish the accused.
6. During the course of hearing of the appeal, the learned Counsel for the appellant reiterated the contentions raised in the grounds of appeal. He submitted that the accused had borrowed the amount from the complainant and towards part payment of those amounts, the accused gave five post dated cheques bearing No. 7242752 for Rs. 38,250/-, 7242753 for Rs. 37,800/-, 7242754 for Rs. 37,350/-, 7242755 for Rs. 36,900/- and 7242756 for Rs. 38,450/- and that the cheques were presented on 8-9-1999 but those cheques were returned on 9-9-1999 with an endorsement insufficient funds and the said return memo was communicated to the complainant by his banker on 15-9-1999 and then on 27-9-1999 the complainant issued statutory notice and the same was served on the accused on 8-10-1999 and in spite of service of notice, the amount was not paid and therefore the complainant filed the complaint. He further submitted that the defence of the accused that the pronotes and cheques were obtained with the help of police is not at all tenable as the said defence was taken in the civil Court in O.S. No. 605 of 1999 against the accused for recovery of the money and the said defence was rejected and the suit was decreed on 29-1-2003 and the said decree has become final and hence the learned Magistrate grossly erred in believing thever-sion of the accused that the cheques were taken by force in the police station. The learned senior counsel further submitted that the learned Magistrate having held that the amounts covered under the cheques were issued to satisfy the legally enforceable debt, dismissed the complaint on the sole ground that the last cheque dated 10-9-1999 was presented on 8-9-1999 i.e. two days in advance and therefore the legal notice issued demanding the entire amount covered under all the five cheques is invalid. The learned Counsel submitted that the last cheque dated 10-9-1999 was also returned by the bank not on the ground that it is premature but on the ground of 'insufficient funds' and therefore on 27-9-1999 a legal notice was issued. He further submitted that at any rate the details of each cheque are given in the legal notice and therefore nothing prevented the accused to pay the amounts covered under four cheques which became payable by the date of presentation of the cheques and even that amount was also not paid and therefore it cannot be said that an offence under Section 138 of the Negotiable Instruments Act is not committed by the accused. The Court below grossly erred in acquitting the accused on the sole ground that one of the five post dated cheques were presented two days before the due date and the amount covered under the said cheque was also included in the legal notice along with the amounts covered under four cheques which became payable. He submitted that Section 138 of the Negotiable Instruments Act prescribes punishment not for dishonour of cheque but for non-payment of debt and that the failure to pay the amounts covered under four cheques gives rise to cause of action and that the statutory notice is contemplated only to give an opportunity to the drawer to pay the amounts covered under the dishonoured cheques and that in the instant case nothing prevented the accused to pay at least the amounts covered under four cheques which became payable long before the presentation of the cheques in the bank which were returned with an endorsement 'insufficient funds' and as the accused failed to pay even the said amounts, the offence punishable under Section 138 of the Negotiable Instruments Act is complete and hence the court below grossly erred in acquitting the accused. The learned Counsel relied upon a decision reported in Suman Sethi v. Ajay K. Churiwal and Anr. , wherein it is held that the notice has to be read as a Whole, and in the notice; demand has to be made for the 'said amount' i.e. cheque amount and that where, in addition to 'said amount' there is also a claim by way of interest, cost, etc. giving break up of the claim and such claim would be severable and will not invalidate the statutory notice. The learned Counsel further relied upon a decision of the Apex Court in K.R. Indira v. Dr. G. Adinarayana 2004 Cri LJ 5 wherein the Division Bench of the Apex Court held that consolidated demand notice issused after dishonour of four cheques would not invalidate the same and that the demand notice would be invalid only where there was no specific demand made for the payment of the amount covered by the cheque. In the said case, the acquittal of the accused was upheld on the ground that the notice was invalid for the reason of no specific demand made for payment of the amount covered by the cheque. The Apex Court in paragraph 8 of the said judgment quoted with approval the observation of the said Court in an earlier case in Central Bank of India and Anr. v. Saxons Farms and Ors. wherein the Supreme Court observed that the object of the notice is to give a chance to the drawer of the cheque to rectify his omission and that the demand in the notice has to be in relation to 'said amount of money' as described in the provision and the drawer of the cheque stands absolved from his liability under Section 138 of the Act if he makes the payment of the amount covered by the cheque of which he was the drawer within 15 days from the date of receipt of notice or before the complaint is filed.
7. On the other hand, the learned Counsel for the respondent-accused contended that an offence punishable under Section 138 of the Negotiable Instruments Act being a technical offence, all the technical formalities as contemplated under Section 138 of the Act must be complied with and that in the instant case the statutory notice issued under Clause (b) of the proviso contained in Section 138 of the Act the amount demanded in the notice is far more than the amount, covered under the four cheques which became payable by the date of presentation of the cheques and hence the statutory notice is invalid and therefore the conviction for the offence punishable under Section 133 qf the Act is not sustainable in law and therefore, the lower Court rightly acquitted the accused and there is no need for interference by this Court. He relied on two decisions of this Court in Yankay Drugs & Pharmaceuticals Ltd. v.
Citi Bank and Anr. 2001 (2) LS 71 : 2001 Cri LJ 4157, wherein His Lordship Justice R. Ramanujam held that notice demanding payment of amount covered by dishonoured cheque is one of the main ingredients of Section 138 of the Negotiable Instruments Act and that if the amount demanded in the notice is not the exact amount covered under the dishonoured cheque, the notice would fall short of its legal requirement under Section 138 of the Negotiable Instruments Act and in such case, it cannot be said that the offence under Section 138 of the Act was committed. The learned Counsel submitted that the said decision of the Court is also followed by Sri Justice G. Yethirajulu of this Court in TCI Finance Ltd., Secunderabad v. State of A.P. and Anr. 2004 Cri LJ 3163 in a similar case and held that notice not issued for amount covered by cheque, cannot be treated as valid notice. Relying on the said decisions, the learned Counsel for the accused submitted that all the cheques including the cheque which did not become payable were presented at the same time and all those cheques were returned by composite return memo and therefore the post dated cheque dated 10-9-1999 which did not become payable by 8-9-1999 cannot be severed from the notice in order to validate the same from the consolidate demand made for payment of Rs. 1,86,750/- which includes the amount covered under the post dated cheque dated 10-9-1999. The learned Counsel submitted that in view of the invalid notice the accused is not liable for punishment under Section 138 of the Negotiable Instruments Act and the learned Magistrate rightly acquitted the accused and that there is no need for intereference with the acquittal by this Court and that the appeal is liable to be dismissed.
8. The points that arise for determination in this appeal are :
1. Whether the accused issued cheques in favour of the complainant in discharge of a legally enforceable debt?
2. If so, whether the statutory notice dated 27.9.1999 issued by the complainant to the accused is in accordance with law?
3. Whether the accused can be found guilty of the offence punishable under Section 138 of the Negotiable Instruments Act when the statutory notice contained not only the dishonour of cheques which became payable by the date of presentation but also the cheque which did not at all become payable by the date of presentation?
4. Whether the order of the acquittal is liable to be set aside?
5. To what result? Point No. 1 :
9. Firstly, it has to be seen whether there was any legally enforceable debt. The case of the complainant is that the accused took Rs. 4 lakhs from out of the matured chit amount and besides that another Rs. 2 lakhs in cash from him and executed two promissory notes for Rs. 3 lakhs each and towards part payment of that debt, the accused issued post dated cheques on different dates with a gap of one month each.
10. On the other hand, it is the case of the accused that he never borrowed any amount from the complainant and that he has nothing to do with the chit transaction business and that his brother was running chit funds and as his brother did not pay the amounts properly, he was taken to the police station and at the police station he was forced to execute the pronotes and also to issue post dated cheques. It is not disputed that the complainant filed civil suit in O.S. No. 605 of 1999 on the file of the X Additional Chief Judge (Fast Track Court), Hyderabad impleading the present accused as first defendant, his brother as second defendant, the Chit Fund Company as 3rd defendant and the Managing Director of the Chit Fund Company as 4th defendant on the foot of the pronotes of Rs. 3 lakhs each and in that plaint also the complainant averred that on 8-8-1999 the accused and his brother arrived at a gentlemen's agreement to pay Rs. 5,50,000/- together with interest and subsequently after persistent persuation, the accused issued five post dated cheques towards part payment of amount but all the cheques were dishonoured. The present accused who was first defendant filed written statement contending that he never executed two promissory notes and he never arrived at a gentlemen's agreement on 8-8-1999 and that with the help of the police, the complainant obtained signatures of the accused on some blank cheques and other blank papers as security for payment of the amount to be due from the Chit Fund Company and the accused could not resist the illegal activities of the plaintiff because of the active participation of police. After due trial the plea of the accused who was first defendant therein was negatived and the suit was decreed only against the present accused who was first defendant therein and the suit against the brother of the accused, Chit Fund Company and the Managing Director of the Chit Fund Company (defendants 2 to 4) was dismissed. When the Civil Court has given a finding to the effect that the pronotes are supported by consideration and the pronotes were executed voluntarily and not under coercion, it is not open for the criminal Court to say that there was no legally enforceable debt. In fact, the Court below did not find that there was no debt due by the accused to the complainant. But, the Court below observed in para 11 of the judgment that it is also made out that it is a case where the cheques in dispute were obtained from the accused forcibly among 20 cheques that were obtained for a total of Rs. 5.5 lakhs. There is no basis for the lower Court to give such a finding. 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 post graduate 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 pronotes executed and the cheques issued are not voluntary and are not binding on him. No such steps were taken by the accused though he is a highly educated person. This conduct of accused belies his version that cheques were obtained forcibly with the aid of police. Moreover, 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 my considered view, the cheques concerned in this case were issued by the accused towards partial discharge of a legally enforceable debt. Hence, this point is found in favour of the complainant and against the respondents-accused.
Point Nos. 2 and 3 :
10A. It is in the evidence of PW-2, an officer in Kanyakaparameswari Co-operative Urban Bank Limited, Kukatpalli that on 8-9-1999 PW-1 deposited five cheques bearing Nos. 724275, 724276, 724277, 724278 and 724279 and those cheques were drawn on the account of Kutumba Rao in Prudential Co-operative Bank, Ameerpet, Hyderabad. He further stated that as their bank is not nationalized bank and it is a cooperative bank, they sent the cheques deposited by the customers to Hyderabad District Co-operative Bank, Kukatpalli for encashment and that the said bank returned the cheques as bounced with an endorsement as 'funds insufficient' along with cheque return memo Ex. P-6 and that thereafter the bank informed the same to the complainant through letter Ex. P-8, dated 15-9-1999. Therefore, it is clear that the post dated cheques dated 15-5-1999, 10-6-1999, 10-7-1999, 10-8-1999 and 10-9-1999 were presented before the bank on 8-9-1999 and they were dishonoured on 9-9-1999 on account of insufficient funds and the said communcation was sent to the complainant on 15-9-1999. It is not disputed that on 27-9-1999 a statutory notice was issued demanding the accused to pay the amounts under five cheques. In fact, the Court below also believed the evidence of PW-2 and found that the dishonour of cheques was communicated to the complainant only on 15-9-1999 and therefore the notice dated 27-9-1999 issued by the complainant to the accused was well within time.
11. But, the court below held that the statutory notice Ex. P-7 is not in accordance with the law and it is not valid under law and on that ground the Court below extended the benefit of doubt to the accused and acquitted him. The only ground on which the Court below held the notice invalid is that one of the five post dated cheques is dated 10-9-1999 and the said cheque was also presented along with the four post dated cheques on 8-9-1999 itself i.e. even before 10-9-1999 the date of the said cheque. It is true that the 5th post dated cheque issued for Rs. 36,450/- is dated 10-9-1999 and it was also presented on 8-9-1999 and it was also dishonoured by the bank with the same endorsement 'insufficient funds'. The learned Magistrate observed that there is no bank statement available before this Court to show whether there was any amount to honour the remaining four cheques under Ex. P-1 to P-4 or not and it is for the complainant to prove that there was no amount even to honour the cheques under Exs. P-1 to P-4 even after exclusion of the cheque under Ex. P-5 which is dated 10-9-1999 and therefore the very presentation of cheque under Ex. P-5 and consequential dishonour memo under Ex. P-6 are not in accordance with law and that the complainant got issued legal notice Ex. P-7 demanding money covered under five cheques for Rs. 1,86,750/- and there was no obligation on the part of the accused to honour the cheque under Ex. P-7 as it was presented on 8-9-1999 as against the date contained on the cheque as 10-9-1999 and therefore the very demand to the tune of Rs. 36,450/- is bad under law. The learned Magistrate further observed that the complaint filed basing on all the cheques and a common legal notice was issued for all the cheques and the legal notice demands payment of Rs. 1,86,750/- and as such, the demand is against the principles of law contemplated under Section 138 of the Negotiable Instruments Act and therefore the very legal notice Ex. P-7 is not valid under law. It is true that there was no obligation for the accused to arrange money for payment of honouring the said post dated cheques dated 10-9-1999 by 8-9-1999 and therefore the dishonour of such document does not attract Section 138 of the Negotiable Instruments Act. Because, till 10-9-1999 the said document cannot even be called as cheque and it is only a bill of exchange till 10-9-1999 and therefore the question of dishonour of that 5th cheque for Rs. 36,450/- does not at all arise and hence Section 138 of the Negotiable Instruments Act has no application so far as the said document Ex. P-5 is concerned and the demand of Rs. 36,450/-under Ex. P-7 is not valid. But merely because the demand to the extent of Rs. 36,450/- is not a valid demand, it cannot be said that the demand in respect of the other four dishonoured cheques is also invalid on that ground. All the cheques are issued on different dates. As seen from the return memo Ex. P-6 the bank while returning the cheques each cheque is mentioned separately with its number and the amount covered under each cheque and the return endorsement 'insufficient funds' is made applicable to each cheque amount mentioned therein. Had there been sufficient funds to honour any of the four cheques or all the four cheques, they would not have returned all the cheques mentioning each amount separately and applying the endorsement 'insufficient funds' to all the cheques. So the return memo Ex. P-6 itself clearly discloses that there was no amount for the accused in the bank to satisfy any of the four cheques Exs. P-1 to P-4. So in my considered view, the learned Magistrate erred in observing that there is no bank statement available before the Court to show whether there was any amount to honour Exs. P-1 to P-4 or not. The learned Magistrate failed to look into Ex. P-6 return memo wherein each cheque was separately mentioned with the amounts covered thereunder making the endorsement applicable to each cheque. In fact, it is not also the case of the accused that he had sufficient funds in the bank to honour the post dated cheques Exs. P-1 to P-4 and had the Ex. P-5 post dated cheque not been presented along with Exs. P-1 to P-4, those four cheques would have been honoured. As the cheques are different cheques bearing different dates, merely because all the cheques were presented at a time, the bank will not return all the cheques even if sufficient funds are available in the account of the drawer to satisfy some of the cheques. Had there been sufficient funds to satisfy any of those cheques, the bank would have definitely honoured such of those cheques and return only the cheques for which the amount is not available. Therefore, I have no hesitation to hold that the learned Magistrate erred in coming to such a conclusion.
12. The learned Counsel for the accused vehemently contended that the offences under Negotiable Instruments Act are technical offences as common legal notice in respect of all the amounts and common demand for Rs. 1,86,750/- was demanded which is far excess of the demand covered under cheques Exs. P-1 to P-4, it amounts to demanding more amount than the amount covered under the cheques and therefore the learned Magistrate rightly held the legal notice as invalid. He invited the attention of this Court to the following decisions of this Court in :
(1) Yankay Drugs and Pharmaceutical's case 2001 Cri LJ 4157 (surpa).
(2) TCI Finance Ltd., Secunderabad v. State of A.P. and Anr. 2004 Cri LJ 3163 (supra).
(3) Suvidha Systems v. Y.N. Mahendra and Ors. 2005 (2) ALT (Cri) 381 (Andh. Pra).
wherein this Court held that the statutory notice issued under Section 138(b) of the Negotiable Instruments Act is not valid for the reason that the demand mentioned in the notice is in variance with the amount covered under the cheque. Relying on the said decisions the learned Counsel for the accused submitted that the facts of this case are also similar to the facts of the cited cases as the statutory notice issued in this case is for Rs. 1,86,750/- though the amount c6v-ered under valid dishonoured cheques Exs. P-1 to P-4 is only Rs. 1,50,300/- and therefore the statutory notice Ex. P-7 is not valid. I have gone through the above cited decisions of this Court and found that this Court held that if the amount demanded is in variance with the amount covered under the dishonoured cheques, it amounts to non-compliance of the statutory notice required to be issued under Section 138(b) of the Negotiable Instruments Act. But, in all those cases there was only one single cheque in each appeal. In the first cited case, the amount covered under the cheque was Rs. 9,972/- but the amount mentioned in the notice was only Rs. 3,871/-. It was stated by the complainant in the said case that it was a typographical mistake and that the amount ought to have been Rs. 9,972/- and not Rs. 3,871/-. But, this Court did not accept the same. Under those circumstances, it was held that the amount demanded under the notice, cannot be said to be the amount covered under the dishonoured cheque and therefore the notice is not valid. In the second cited case the accused had given post dated cheque on 23-3-1995 for Rs. 26,12,742/- and subsequent to that date the accused paid Rs. 12,50,000/- on 25-4-1,995 and promised to settle the account by the end of May, 1995. On 9-6-1995 the complainant company wrote a letter to the accused requesting' to settle the account before 15-6-1995, failing which the cheque will be presented on 16-6-1995. As the accused failed to settle the account on 16-6-1995 the complainant presented the cheque issued for Rs. 26,12,742/- and the said cheque was dishonoured on 26-6-1995 with an endorsement 'funds insufficient'. On 24-6-1995 the complainant wrote a letter to the accused requesting to pay the balance amount of Rs. 15,16,329.17 ps. and the accused received the notice and gave reply admitting the issuance of cheque. The complainant filed the complaint under Section 138 of the Negotiable Instruments Act. On such facts, this Court relying on the above cited decision held that the amount demanded in the legal notice is in variance with the amount covered under the cheque and therefore the notice is not valid. In the 3rd cited case two different complaints had been filed by the complainant in respect of two cheques which were issued outside the police station on account of the promise made by the complainant to withdraw the criminal case filed against the accused. In that case also while the cheque amount was Rs. 5,79,000/-, the demand was made for a sum of Rs. 6,50,000/- in the notice and on such facts It was found that the notice is vague and insufficient and the said notice cannot be sustained in law. Thus, in all the above cases the cheque involved was only single cheque and the amounts mentioned in the notices are in variance with the amounts covered under the cheque and further in the notice the amount covered under the cheque was not specified in each of those cases. But, in the instant case, as seen from the notice Ex. P-7 the complainant clearly stated the amounts covered under each cheque separately and demanded all those amounts. Merely because all the amounts are totalled and mentioned the total figure, it cannot be said that such a demand is vague and not severable to comply the same by the accused in order to avoid prosecution under Section 138 of the Negotiable Instruments Act. The amounts covered under each cheque has been separately given in the notice without adding or reducing the amount covered under each cheque. The only thing the complainant did was that instead of issuing five separate legal notices, he issued a consolidated notice mentioning each cheque amount separately and in that notice the post dated cheque dated 10-9-1999 was also included though it was dishonoured on 8-9-1999 prematurely by the bank, without observing the date of the post dated cheque, dated 10-9-1999. But, merely because such a consolidated notice was given, it cannot be said that the notice is invalid on account of such consolidation, especially when the demand made in the legal notice is severable to enable the accused to comply the same to escape the wrath of Section 138 of the Negotiable Instruments Act. In fact, the Apex. Court very recently on 9-10-2003 in K. R. Indira's case 2004 Cri LJ 5 (supra) dealt with a consolidated demand notice and held that in a given case if the consolidated notice is found to provide sufficient information envisaged by the statutory provision and there was a specific demand for the payment of the sum covered by the cheque dishonoured, mere fact that it was a consolidated notice, and/or that further demands in addition to the statutorily envisaged demand was also found to have been made may not invalidate the same. Of course, in the cited case it was held that the statutory notice issued therein was not valid and the acquittal was confirmed. But, their Lordships held that the notice was invalid not on the ground that it is consolidated notice but on the ground that the contents of notice showed that not only the cheque amounts were different from the alleged loan amounts but also the demand was made not of the cheque amounts but only the loan amount as though it is a demand for the loan amount and not the demand for payment of the cheque amount; nor could it be said that it was a demand for payment of the cheque amount and in addition thereto made further demands as well. The Apex Court in that case was categorical that the notice therein is imperfect, not because it had any further or additional claims as well but it did not specifically contain any demand for the payment of the cheque amount, the non-compliance with such a demand only being the incriminating circumstance which expose the drawer for being proceeded against under Section 138 of the Negotiable Instruments Act. Their Lordships in the cited case quoted with approval earlier decision of the Apex Court in Central Bank of India's case 1999 Cri LJ 4571 (supra) wherein it was observed that the object of the notice is to give a chance to the drawer of the cheque to rectify his omission and that the demand in the notice has to be in relation to 'said amount of money' as described in the provision. Their Lordships further quoted another decision of the Apex Court, with approval, in Suman Sethi v. Ajay K. Churiwal wherein it was held that the legislative intent as evident from Section 138 of the Act is that if for the dishonoured cheque ths demand is not met within 15 days of the receipt of the notice the drawer is liable for conviction and if the cheque amount is paid within the above period or before the complaint is filed, the legal liability under Section 138 of the Act ceases to be operative and for the recovery of other demands such as compensation, costs, interests etc. separate proceedings would lie and that if in a notice any other sum is indicated in addition to the amount covered by the cheque, that does not invalidate the notice. As seen from paragraph 11 of the Judgment of the Apex Court, their Lordships observed as follows :
In a given case if the consolidated notice is found to provide sufficient information envisaged by the statutory provision and there was a specific demand for the payment of the sum covered by the cheque dishonoured, mere fact that it was a consolidated notice, and/or that further demands in addition to the statutorily envisaged demand was also found to have been made may not invalidate the same. This position could not be disputed by the learned Counsel for the respondents.
13. So from the above cited Apex Court's decision, it is clear that the object of the notice is to enable the drawer to comply with the amounts covered under the cheque in order to escape from the clutches of Section 138 of the Act and therefore the drawer must be in a position to know the actual demand covered under each cheque in the event of the consolidated notice issued in respect of several cheques. Here in the instant case, as seen from Ex. P-7 the complainant specified the demand in respect of each cheque separately and also mentioned the dates of each cheque and its presentation. Therefore, there was no difficulty for the accused to know the demand under each cheque in order to comply the same to avoid prosecution under Section 138 of the Negotiable Instruments Act. Merely because the dishonour of one of the five cheques Ex. P-5 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. P-1 to P-4 though the amounts covered under those dishonoured cheques were separately mentioned. If the accused had made payments covered under Exs. P-1 to P-4 ignoring the amount covered under Ex. P-5, the accused would have been absolved from the prosecution under Section 138 of the Negotiable Instruments Act. Merely because the additional amount i.e. the amount covered under Ex. P-5 is also demanded under the same notice, it cannot be said that the demand notice in respect of Exs. P-1 to P-4 cheques also is invalid for that reason. The Apex Court in Suman Sethi's case 2000 Cri LJ 1391 (supra) held that in a notice if any other sum is indicated in addition to the amount covered by the cheque, that does not invalidate the notice. So, here in the instant case the amount covered under Ex. P-5 is separate and additional demand in addition to the amounts covered under cheques Ex. P-1 to P-4. The learned Counsel submitted that in the cited Apex Court's judgment the amounts were not covered under the cheque and the said amount was in respect of the compensation, costs and interest etc. whereas in the instant case, the additional amount is also covered under another cheque and therefore the decision of Suman Sethi's case (supra) is not applicable to the facts of the case, As already observed supra Ex. P-5 cannot be called as a cheque on 8-9-1999 as it is dated 10-9-1999 and that it is only a bill of exchange till 10-9-1999, Further, it does not make any difference whether it is an amount covered under improperly dishonoured cheque or any amount claimed as compensation, interest, costs etc. In fact, the complainant is entitled to file four separate complaints also one in respect of each dishonoured cheque on the basis of the same legal notice. In order to avoid multiplicity he filed common complaint in respect of all the dishonoured cheques. Had the five separate complaints been filed, can it be said that the prosecution in respect of four complaints based on Exs. P-1 to P-4 shall fail for the reason that the prosecution in respect of Ex. P-5 cheque is not maintainable. As all the five cheques are of different dates for different amounts and the notice Ex. P-7 contained demand amounts separately under each cheque, I am unable to agree with the contention of the learned Counsel for the respondent-accused. In my considered view, the findings recorded by the lower Court are not sustainable. Thus, these points are held accordingly.
Point No. 4 :
14. In view of the findings on points 1, 2 and 3 the order of acquittal is not sustainable in law and it is liable to be set aside and the accused is to be found guilty of the offence punishable under Section 138 of the Negotiable Instruments Act. Thus, this point is held accordingly.
Point No. 5 :
15. Regarding the sentence for the offence punishable under Section 138 of the Negotiable Instruments Act, the prescribed punishment is with imprisonment for a term, which may extend to two years or with fine, which may extend to twice the amount of the cheque, or with both. In the instant case, the cheque amount covered under Exs. P-1 to P-4 is Rs. 1,50,300/-. It is in the evidence that the accused is lecturer. Considering the facts of this case and the status of the accused, I am of the considered view that the sentence of fine in the form of compensation to a tune of Rs. 2,00,000/- would meet the ends of justice.
16. In the result, the appeal is allowed and the order of acquittal is set aside and the 1st respondent-accused is found guilty of the offence punishable under Section 138 of the Negotiable Instruments Act and he is convicted and sentenced to pay compensation of Rs. 2,00,000/- (Rupees two lakhs only) to the appellant-complainant within a period of three months from this day, failing which the Magistrate concerned shall take necessary steps for realization of the said amount, in accordance with law.