Himachal Pradesh High Court
Tule Ram vs Ramneek Singh on 19 September, 2024
Neutral Citation No. ( 2024:HHC:8786 ) IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA Cr. Revision No. 323 of 2023 .
Reserved on: 21.8.2024 Date of Decision: 19.9.2024.
Tule Ram ...Petitioner
Versus
Ramneek Singh
Coram
r to ...Respondent
Hon'ble Mr Justice Rakesh Kainthla, Judge. Whether approved for reporting?1 Yes.
For the Petitioner : Mr. Mukul Sood, Advocate. For the Respondent : Mr. Arun Sehgal, Advocate.
Rakesh Kainthla, Judge The petitioner has filed the present petition against the judgment passed by learned Additional Sessions Judge, Kullu (learned Appellate Court), vide which the appeal filed by the petitioner (accused before the learned Trial Court) was dismissed and the judgment of conviction dated 16.11.2022 and order of sentence dated 18.11.2022, passed by learned Judicial Magistrate First Class, Manali (learned Trial Court) were upheld.
1Whether reporters of Local Papers may be allowed to see the judgment? Yes.
::: Downloaded on - 19/09/2024 20:31:40 :::CIS 2Neutral Citation No. ( 2024:HHC:8786 ) (Parties shall hereinafter be referred to in the same manner as they were arrayed before the learned Trial Court for convenience).
.
2. Briefly stated, the facts giving rise to the present petition are that the complainant filed a complaint before the learned Trial Court against the accused for the commission of an offence punishable under Section 138 of the Negotiable Instruments Act (NI Act). It was asserted that the complainant and the accused had good terms with each other. The accused borrowed a sum of ₹2.00 lacs in July 2008 from him to meet his domestic and business needs. The accused issued a cheque of ₹2.00 lacs to return the amount. The complainant deposited the cheque in his account but the cheque was dishonoured with an endorsement of 'funds insufficient'. The complainant served a notice upon the accused asking him to pay the amount but he failed to do so. Hence, the complaint was filed before the learned Trial Court to take action against the accused as per the law.
3. Learned Trial Court found sufficient reasons to summon the accused. When the accused appeared, a notice of accusation was put to him for the commission of an offence ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 3 Neutral Citation No. ( 2024:HHC:8786 ) punishable under Section 138 of the NI Act. He pleaded not guilty and claimed to be tried.
.
4. The complainant examined himself (CW1) to prove his case.
5. The accused in his statement recorded under Section 313 of Cr.P.C. denied the complainant's case in its entirety. He stated that he did not know the accused and he was falsely implicated. He stated that he wanted to lead defence evidence but subsequently, no evidence was led.
6. Learned Trial Court held that the cheque carries with it a presumption of consideration. The burden lies upon the accused to rebut this presumption. The accused failed to rebut the presumption. The cheque was dishonoured with the endorsement 'funds insufficient'. The accused failed to pay the amount within 15 days from the date of receipt of the notice of demand. Hence, the accused was convicted of the commission of an offence punishable under Section 138 of the NI Act and he was sentenced to undergo simple imprisonment for one year, pay a compensation of ₹3.00 lacs and in default of payment of compensation, to undergo simple imprisonment for one month.
::: Downloaded on - 19/09/2024 20:31:40 :::CIS 4Neutral Citation No. ( 2024:HHC:8786 )
7. Being aggrieved from the judgment and order passed by the learned Trial Court, the accused filed an appeal which was .
decided by learned Sessions Judge, Kullu (learned Appellate Court). Learned Appellate Court agreed with the findings recorded by the learned Trial Court that the cheque carried with it a presumption of consideration and the accused had failed to rebut the presumption. The cross-examination of the complainant was not sufficient to rebut the presumption. A plea was taken that the accused had issued a security cheque and he was liable to pay ₹40,000/-. This shows that the issuance of the cheque was not disputed. A cheque issued as a security can form the subject matter of the complaint for the commission of an offence punishable under Section 138 of the NI Act. Hence, the accused was convicted and sentenced as aforesaid.
8. Being aggrieved from the judgment passed by the learned Appellate Court, the accused has filed the present appeal asserting that the learned Courts below erred in convicting and sentencing the accused. The oral and documentary evidence was not properly appreciated. The complainant failed to prove the existence of legally enforceable debt. No receipt or writing was proved to show that the amount was paid to the accused. The ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 5 Neutral Citation No. ( 2024:HHC:8786 ) accused stated that the cheque was issued as a security cheque.
This was not considered by the learned Trial Court. Hence, it was .
prayed that the present revision be allowed and the judgments and order passed by learned Courts below be set aside.
9. I have heard Mr. Mukul Sood, learned counsel for the petitioner/accused and Mr. Arun Sehgal, learned counsel for the respondent/complainant.
10. Mr Mukul Sood, learned counsel for the petitioner/accused submitted that the learned Courts below erred in convicting and sentencing the accused. The complainant had failed to prove the existence of legally enforceable debt or liability. No receipt was produced before the Court to establish this fact. The plea of the accused that the cheque was issued as a security was highly probable. Learned Courts below erred in appreciating this fact. Therefore, he prayed that the present revision be allowed and the judgments and order passed by learned Courts below be set aside.
11. Mr. Arun Sehgal, learned counsel for the respondent/ complainant supported the judgments and order passed by ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 6 Neutral Citation No. ( 2024:HHC:8786 ) learned Courts below and submitted that no interference is required with the same.
.
12. I have given considerable thought to the submissions made at the bar and have gone through the records carefully.
13. It was laid down by the Hon'ble Supreme Court in Malkeet Singh Gill v. State of Chhattisgarh, (2022) 8 SCC 204:
(2022) 3 SCC (Cri) 348: 2022 SCC OnLine SC 786 that the revisional court is not an appellate jurisdiction and it can only rectify the patent defect, errors of jurisdiction or the law. It was observed on page 207:
"10. Before adverting to the merits of the contentions, at the outset, it is apt to mention that there are concurrent findings of conviction arrived at by two courts after a detailed appreciation of the material and evidence brought on record. The High Court in criminal revision against conviction is not supposed to exercise the jurisdiction like to the appellate court and the scope of interference in revision is extremely narrow. Section 397 of the Criminal Procedure Code (in short "CrPC") vests jurisdiction to satisfy itself or himself as to the correctness, legality or propriety of any finding, sentence or order, recorded or passed, and as to the regularity of any proceedings of such inferior court. The object of the provision is to set right a patent defect or an error of jurisdiction or law. There has to be a well-founded error which is to be determined on the merits of individual cases. It is also well settled that while considering the same, the Revisional Court does not dwell at length upon ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 7 Neutral Citation No. ( 2024:HHC:8786 ) the facts and evidence of the case to reverse those findings.
14. This position was reiterated in State of Gujarat v.
.
Dilipsinh Kishorsinh Rao, 2023 SCC OnLine SC 1294 wherein it was observed:
"13. The power and jurisdiction of the Higher Court under Section 397 Cr. P.C. which vests the court with the power to call for and examine records of an inferior court is for the purposes of satisfying itself as to the legality and regularities of any proceeding or order made in a case. The object of this provision is to set right a patent defect or an error of jurisdiction or law or the perversity which has crept into such proceedings. It would be apposite to refer to the judgment of this court in Amit Kapoor v. Ramesh Chandra, (2012) 9 SCC 460 where the scope of Section 397 has been considered and succinctly explained as under:
"12. Section 397 of the Code vests the court with the power to call for and examine the records of an inferior court for the purposes of satisfying itself as to the legality and regularity of any proceedings or order made in a case. The object of this provision is to set right a patent defect or an error of jurisdiction or law. There has to be a well-founded error and it may not be appropriate for the court to scrutinise the orders, which upon the face of it bear a token of careful consideration and appear to be in accordance with the law. If one looks into the various judgments of this Court, it emerges that the revisional jurisdiction can be invoked where the decisions under challenge are grossly erroneous, there is no compliance with the provisions of law, the finding recorded is based on no evidence, material evidence is ignored or judicial discretion is exercised arbitrarily or perversely. These are not exhaustive classes but are merely indicative.::: Downloaded on - 19/09/2024 20:31:40 :::CIS 8
Neutral Citation No. ( 2024:HHC:8786 ) Each case would have to be determined on its own merits.
13. Another well-accepted norm is that the revisional .
jurisdiction of the higher court is a very limited one and cannot be exercised in a routine manner. One of the inbuilt restrictions is that it should not be against an interim or interlocutory order. The Court has to keep in mind that the exercise of revisional jurisdiction itself should not lead to injustice ex-facie. Where the Court is dealing with the question as to whether the charge has been framed properly and in accordance with law in a given case, it may be reluctant to interfere in the exercise of its revisional jurisdiction unless the case substantially falls within the categories aforestated. Even framing of charge is a much-advanced stage in the proceedings under the CrPC."
15. The present revision has to be decided as per the parameters laid down by the Hon'ble Supreme Court.
16. The complainant reiterated the contents of the complaint in his proof affidavit. He stated in his cross-
examination that he had worked as Manager from the year 2008 till 2019. He is an agriculturist. His salary was ₹40,000/- per month. His annual income was ₹6.00 lacs to ₹7.00 lacs. He did not file any income tax return. He has his wife, child and parents in his home. He knew the accused for eight years. The accused had taken money for his necessities. The money was paid in his room. No other person was present. He denied that ₹40,000/-
::: Downloaded on - 19/09/2024 20:31:40 :::CIS 9Neutral Citation No. ( 2024:HHC:8786 ) was paid by him. He denied that the accused had purchased liquor from him and he had taken a blank cheque from the .
accused. He denied that a false complaint was made by the accused.
17. The cross-examination of this witness shows that the accused has not disputed the issuance of the cheque as it was suggested to him that a blank cheque was issued. The accused has also not disputed the transaction with the complainant as it was suggested to him that he had advanced ₹40,000/- to the accused. It was laid down by the Hon'ble Supreme Court in Balu Sudam Khalde v. State of Maharashtra, 2023 SCC OnLine SC 355 that the suggestion put to the witness can be taken into consideration while determining the innocence or guilt of the accused. It was observed: -
"34. According to the learned counsel, such suggestions could be a part of the defence strategy to impeach the credibility of the witness. The proof of guilt required of the prosecution does not depend on the suggestion made to a witness.
35. In Tarun Bora alias Alok Hazarika v. State of Assam reported in 2002 Cri. LJ 4076, a three-judge Bench of this Court was dealing with an appeal against the order passed by the Designated Court, Guwahati, in the TADA Sessions case wherein the appellant was convicted under Section 365 of the IPC read with Section 3(1) and 3(5) of the ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 10 Neutral Citation No. ( 2024:HHC:8786 ) Terrorists and Disruptive Activities (Prevention) Act, 1987.
36. In the aforesaid case, this Court, while considering the .
evidence on record took note of a suggestion which was put to one of the witnesses and considering the reply given by the witness to the suggestion put by the accused, arrived at the conclusion that the presence of the accused was admitted. We quote with profit the following observations made by this Court in paragraphs 15, 16 and 17 as under:
"15. The witness further stated that during the assault, the assailant accused him of giving information to the army about the United Liberation Front of Assam (ULFA). He further stated that on the third night, he was carried away blindfolded on a bicycle to a different place and when his eyes were unfolded, he could see his younger brother Kumud Kakati (P.W.-2) and his wife Smt. Prema Kakati (P.W.-3). The place was Duliapather, which is about 6-7 km. away from his village Sakrahi. The witness identified the appellant-Tarun Bora and stated that it was he who took him in an ambassador car from the residence of Nandeswar Bora on the date of the incident.
16. In cross-examination the witness stated as under: "Accused-Tarun Bora did not blind my eyes nor he assaulted me."
17. This part of the cross-examination is suggestive of the presence of accused Tarun Bora in the whole episode. This will clearly suggest the presence of the accused-Tarun Bora as admitted. The only denial is the accused did not participate in blind-folding the eyes of the witness nor assaulted him."
37. In Rakesh Kumar alias Babli v. State of Haryana reported in (1987) 2 SCC 34, this Court was dealing with an appeal against the judgment of the High Court affirming the order of the Sessions Judge whereby the appellant and ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 11 Neutral Citation No. ( 2024:HHC:8786 ) three other persons were convicted under Section 302 read with Section 34 of the IPC. While re-appreciating the evidence on record, this Court noticed that in the cross- examination of PW 4, Sube Singh, a suggestion was made .
with regard to the colour of the shirt worn by one of the accused persons at the time of the incident. This Court taking into consideration the nature of the suggestion put by the defence and the reply arrived at the conclusion that the presence of the accused namely Dharam Vir was established on the spot at the time of occurrence. We quote the following observations made by this Court in paragraphs 8 and 9 as under:
"8. PW 3, Bhagat Singh, stated in his examination- in-chief that he had identified the accused at the time of occurrence. But curiously enough, he was not cross-examined as to how and in what manner he could identify the accused, as pointed out by the learned Sessions Judge. No suggestion was also given to him that the place was dark and that it was not possible to identify the assailants of the deceased.
9. In his cross-examination, PW 4, Sube Singh, stated that the accused Dharam Vir was wearing a shirt of white colour. It was suggested to him on behalf of the accused that Dharam Vir was wearing a shirt of cream colour. In answer to that suggestion, PW 4 said: "It is not correct that Dharam Vir accused was wearing a shirt of a cream colour and not a white colour at that time." The learned Sessions Judge has rightly observed that the above suggestion at least proves the presence of accused Dharam Vir, on the spot at the time of occurrence."
38. Thus, from the above, it is evident that the suggestion made by the defence counsel to a witness in the cross- examination if found to be incriminating in nature in any manner would definitely bind the accused and the accused cannot get away on the plea that his counsel had no implied authority to make suggestions in the nature of admissions against his client.
::: Downloaded on - 19/09/2024 20:31:40 :::CIS 12Neutral Citation No. ( 2024:HHC:8786 )
39. Any concession or admission of a fact by a defence counsel would definitely be binding on his client, except the concession on the point of law. As a legal proposition, we cannot agree with the submission canvassed on behalf .
of the appellants that an answer by a witness to a suggestion made by the defence counsel in the cross- examination does not deserve any value or utility if it incriminates the accused in any manner."
18. Therefore, the suggestion can be taken into consideration and once the issuance of the cheque was not disputed, the version of the complainant that the accused had issued the cheque has to be accepted as correct.
19. It was laid down by this Court in Naresh Verma vs. Narinder Chauhan 2020(1) Shim. L.C. 398 that where the accused had not disputed his signatures on the cheque, the Court has to presume that it was issued in discharge of legal liability and the burden would shift upon the accused to rebut the presumption.
It was observed: -
"8. Once signatures on the cheque are not disputed, the plea with regard to the cheque having not been issued towards discharge of lawful liability, rightly came to be rejected by learned Courts below. Reliance is placed upon Hiten P. Dalal v. Bartender NathBannerji, 2001 (6) SCC 16, wherein it has been held as under:
"The words 'unless the contrary is proved' which occur in this provision make it clear that the presumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible. A fact is said to be proved when its existence is ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 13 Neutral Citation No. ( 2024:HHC:8786 ) directly established or when upon the material before it the Court finds its existence to be so probable that a reasonable man would act on the supposition that it exists. Unless, therefore, the .
explanation is supported by proof, the presumption created by the provision cannot be said to be rebutted......"
9. S.139 of the Act provides that it shall be presumed unless the contrary is proved, that the holder of a cheque received the cheque of nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability.
20. Similar is the judgment in Basalingappa vs. Mudibasappa 2019 (5) SCC 418 wherein it was held:
"26. Applying the proposition of law as noted above, in the facts of the present case, it is clear that the signature on the cheque having been admitted, a presumption shall be raised under Section 139 that the cheque was issued in discharge of debt or liability."
21. This position was reiterated in Kalamani Tex v. P. Balasubramanian, (2021) 5 SCC 283: (2021) 3 SCC (Civ) 25 : (2021) 2 SCC (Cri) 555: 2021 SCC OnLine SC 75wherein it was held at page 289:
"13. Adverting to the case in hand, we find on a plain reading of its judgment that the trial court completely overlooked the provisions and failed to appreciate the statutory presumption drawn under Section 118 and Section 139 of NIA. The statute mandates that once the signature(s) of an accused on the cheque/negotiable instrument are established, then these "reverse onus"
clauses become operative. In such a situation, the obligation shifts upon the accused to discharge the ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 14 Neutral Citation No. ( 2024:HHC:8786 ) presumption imposed upon him. This point of law has been crystallised by this Court in Rohitbhai Jivanlal Patel v. State of Gujarat [Rohitbhai Jivanlal Patel v. State of Gujarat, (2019) 18 SCC 106, para 18 : (2020) 3 SCC (Civ) 800 : (2020) 3 .
SCC (Cri) 575] in the following words : (SCC pp. 120-21, para 18) "18. In the case at hand, even after purportedly drawing the presumption under Section 139 of the NI Act, the trial court proceeded to question the want of evidence on the part of the complainant as regards the source of funds for advancing loan to the accused and want of examination of relevant witnesses who allegedly extended him money for advancing it to the accused. This approach of the trial court had been at variance with the principles of presumption in law. After such presumption, the onus shifted to the accused and unless the accused had discharged the onus by bringing on record such facts and circumstances as to show the preponderance of probabilities tilting in his favour, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of funds for advancing loan to the appellant-
accused."
14. Once the 2nd appellant had admitted his signatures on the cheque and the deed, the trial court ought to have presumed that the cheque was issued as consideration for a legally enforceable debt. The trial court fell in error when it called upon the respondent complainant to explain the circumstances under which the appellants were liable to pay. Such approach of the trial court was directly in the teeth of the established legal position as discussed above, and amounts to a patent error of law.."
22. Similar is the judgment in APS Forex Services (P) Ltd. v.
Shakti International Fashion Linkers (2020) 12 SCC 724, wherein it was observed:-
::: Downloaded on - 19/09/2024 20:31:40 :::CIS 15Neutral Citation No. ( 2024:HHC:8786 ) 7.2. What is emerging from the material on record is that the issuance of a cheque by the accused and the signature of the accused on the said cheque are not disputed by the accused. The accused has also not disputed that there .
were transactions between the parties. Even as per the statement of the accused, which was recorded at the time of the framing of the charge, he has admitted that some amount was due and payable. However, it was the case on behalf of the accused that the cheque was given by way of security and the same has been misused by the complainant. However, nothing is on record that in the reply to the statutory notice it was the case on behalf of the accused that the cheque was given by way of security. Be that as it may, however, it is required to be noted that earlier the accused issued cheques which came to be dishonoured on the ground of "insufficient funds" and thereafter a fresh consolidated cheque of ₹9,55,574 was given which has been returned unpaid on the ground of "STOP PAYMENT". Therefore, the cheque in question was issued for the second time. Therefore, once the accused has admitted the issuance of a cheque which bears his signature, there is a presumption that there exists a legally enforceable debt or liability under Section 139 of the NI Act. However, such a presumption is rebuttable in nature and the accused is required to lead the evidence to rebut such presumption. The accused was required to lead evidence that the entire amount due and payable to the complainant was paid.
9. Coming back to the facts in the present case and considering the fact that the accused has admitted the issuance of the cheques and his signature on the cheque and that the cheque in question was issued for the second time after the earlier cheques were dishonoured and that even according to the accused some amount was due and payable, there is a presumption under Section 139 of the NI Act that there exists a legally enforceable debt or liability. Of course, such presumption is rebuttable in nature. However, to rebut the presumption, the accused ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 16 Neutral Citation No. ( 2024:HHC:8786 ) was required to lead the evidence that the full amount due and payable to the complainant had been paid. In the present case, no such evidence has been led by the accused. The story put forward by the accused that the .
cheques were given by way of security is not believable in the absence of further evidence to rebut the presumption and more particularly the cheque in question was issued for the second time after the earlier cheques were dishonoured. Therefore, both the courts below have materially erred in not properly appreciating and considering the presumption in favour of the complainant that there exists legally enforceable debt or liability as per Section 139 of the NI Act. It appears that both, the learned trial court as well as the High Court, have committed an error in shifting the burden upon the complainant to prove the debt or liability, without appreciating the presumption under Section 139 of the NI Act. As observed above, Section 139 of the Act is an example of reverse onus clause and therefore, once the issuance of the cheque has been admitted and even the signature on the cheque has been admitted, there is always a presumption in favour of the complainant that there exists legally enforceable debt or liability and thereafter, it is for the accused to rebut such presumption by leading evidence.
23. Significantly, the accused had not stated in his statement recorded under Section 313 of Cr.P.C. that he had taken a loan of ₹40,000/- from the complainant and had issued a blank cheque as security. Hence, learned Courts below had rightly held that the defence taken by the accused that he had taken ₹40,000/- from the complainant and had issued a blank cheque was not proved.
::: Downloaded on - 19/09/2024 20:31:40 :::CIS 17Neutral Citation No. ( 2024:HHC:8786 )
24. It was submitted that the burden was upon the complainant to prove the existence of legally enforceable debt or .
liability. Reliance was placed upon the judgment of the Hon'ble Supreme Court in Krishna Janardhan Bhat vs. Dattatraya G. Hegde, 2004 (4) SCC 54 and B.P. Girish Vs. State of Karnataka (2012) (1) RCR Civil 641 which in turn relied on the judgment of Krishna Janardhan Bhat (supra). The judgment of Krishna Janardhan Bhat (supra) was considered by the Hon'ble Supreme Court in Rangappa v. Sri Mohan, (2010) 11 SCC 441: 2010 SCC OnLine SC 583, and it was held that the observations made in Krishan Janardhan Bhat (supra) may not be correct. It was observed:
"26. In light of these extracts, we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat [(2008) 4 SCC 54: (2008) 2 SCC (Cri) 166] may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant."::: Downloaded on - 19/09/2024 20:31:40 :::CIS 18
Neutral Citation No. ( 2024:HHC:8786 )
25. In similar circumstances, the Hon'ble Supreme Court had held in Rohitbhai Jivanlal Patel v. State of Gujarat (2019) 18 .
SCC 106, 18 that once the presumption had been drawn, the onus shifted to the accused and unless the accused discharged the onus, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of fund or non-
examination of the witnesses. It was observed: -
"18. In the case at hand, even after purportedly drawing the presumption under Section 139 of the NI Act, the trial court proceeded to question the want of evidence on the part of the complainant as regards the source of funds for advancing loan to the accused and want of examination of relevant witnesses who allegedly extended him money for advancing it to the accused. This approach of the trial court had been at variance with the principles of presumption in law. After such presumption, the onus shifted to the accused and unless the accused had discharged the onus by bringing on record such facts and circumstances as to show the preponderance of probabilities tilting in his favour, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of funds for advancing loan to the appellant-accused. The aspect relevant for consideration had been as to whether the appellant-
accused has brought on record such facts/material/circumstances which could be of a reasonably probable defence."
26. It was laid down by the Hon'ble Supreme Court in Uttam Ram Versus Devinder Singh Hudan and another (2019) 10 SCC 287 that the complainant is not to prove the debt as in a civil ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 19 Neutral Citation No. ( 2024:HHC:8786 ) court in view of the presumption but only to prove that the cheque was issued by the accused. It was observed:
.
"20. The Trial Court and the High Court proceeded as if, the appellant is to prove a debt before a civil court wherein, the plaintiff is required to prove his claim on the basis of evidence to be laid in support of his claim for the recovery of the amount due. Dishonour of a cheque carries a statutory presumption of consideration. The holder of the cheque in due course is required to prove that the cheque was issued by the accused and that when the same was presented, it was not honoured. Since there is a statutory presumption of consideration, the burden is on the accused to rebut the presumption that the cheque was issued not for any debt or other liability."
27. It was laid down in P. Rasiya v. Abdul Nazer, 2022 SCC OnLine SC 1131 that the complainant is not to state the nature of the transaction or the source of funds. It was observed:
"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, 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 are not disputed by the accused, in that case, the onus will shift upon the accused to prove the contrary that the ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 20 Neutral Citation No. ( 2024:HHC:8786 ) 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."
28. Therefore, in view of the binding precedents of the Hon'ble Supreme Court, the complainant is not required to prove the existence of legally enforceable debt or liability as this is a matter of presumption. Rather, the accused is required to disprove the existence of legally enforceable debt or liability.
29. The learned Courts below had rightly held that there is a presumption under Section 139 of the Negotiable Instruments Act that the cheque was issued in the discharge of the legal liability. This presumption was explained by the Hon'ble Supreme Court in Triyambak S. Hegde Versus Sripad 2022 (1) SCC 742 as under:
11. From the facts arising in this case and the nature of the rival contentions, the record would disclose that the signature on the documents at Exhibits P-6 and P-2 is not disputed. Exhibit P-2 is the dishonoured cheque based on which the complaint was filed. From the evidence tendered before the JMFC, it is clear that the respondent has not disputed the signature on the cheque.
If that be the position, as noted by the courts below a presumption would arise under Section 139 in favour of ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 21 Neutral Citation No. ( 2024:HHC:8786 ) the appellant who was the holder of the cheque. Section 139 of the N.I. Act reads as hereunder: -
"139. A presumption in favour of the holder- 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 the discharge, in whole or in part, of any debt or other liability."
12 Insofar as the payment of the amount by the appellant in the context of the cheque having been signed by the respondent, the presumption for the passing of the consideration would arise as provided under Section 118(a) of N.I. Act which reads as hereunder: -
"118. Presumptions as to negotiable instruments -
Until the contrary is proved, the following presumptions shall be made: -
(a) of consideration - that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration."
13. The above-noted provisions are explicit to the effect that such presumption would remain until the contrary is proved. The learned counsel for the appellant in that regard has relied on the decision of this Court in K. Bhaskaran vs. SankaranVaidhyanBalan&Anr., 1999 (7) SCC 510 wherein it is held as hereunder:
"9. As the signature in the cheque is admitted to be that of the accused, the presumption envisaged in Section 118 of the Act can legally be inferred that the cheque was made or drawn for consideration on the date on which the cheque bears. Section 139 of the Act enjoins the Court to presume that the holder of the cheque received it for the discharge of any ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 22 Neutral Citation No. ( 2024:HHC:8786 ) debt or liability. The burden was on the accused to rebut the aforesaid presumption. The Trial Court was not persuaded to rely on the interested testimony of DW-1 to rebut the presumption. The .
said finding was upheld by the High Court. It is not now open to the accused to contend differently on that aspect."
14. The learned counsel for the respondent has however referred to the decision of this Court in Basalingappa vs. Mudibasappa, 2019 (5) SCC 418 wherein it is held as hereunder: -
"25. We having noticed the ratio laid down by this Court in the above cases on Sections 118 (a) and 139, we now summarise the principles enumerated by this Court in the following manner:
25.1. Once the execution of the cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.
25.2. The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of the preponderance of probabilities.
25.3. To rebut the presumption, it is open for the accused to rely on evidence led by him or the accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely.
25.4. That it is not necessary for the accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a persuasive burden.::: Downloaded on - 19/09/2024 20:31:40 :::CIS 23
Neutral Citation No. ( 2024:HHC:8786 ) 25.5. It is not necessary for the accused to come into the witness box to support his defence.
26. Applying the proposition of law as noted above, .
in the facts of the present case, it is clear that the signature on the cheque having been admitted, a presumption shall be raised under Section 139 that the cheque was issued in discharge of debt or liability. The question to be looked into is as to whether any probable defence was raised by the accused. In cross-examination of PW1, when the specific question was put that the cheque was issued in relation to a loan of ₹25,000 taken by the accused, PW1 said that he does not remember. PW1 in his evidence admitted that he retired in 1997 on which date he received a monetary benefit of ₹8 lakhs, which was encashed by the complainant. It was also brought in the evidence in the evidence that in the year 2010, the complainant entered into a sale agreement for which he paid an amount of ₹4,50,000 to Balana Gouda towards sale consideration. Payment of ₹4,50,000 being admitted in the year 2010 and a further payment of a loan of ₹ 50,000 with regard to which Complaint No.119 of 2012 was filed by the complainant, copy of which complaint was also filed as Ext. D-2, there was a burden on the complainant to prove his financial capacity. In the years 2010-2011, as per the own case of the complainant, he made a payment of ₹18 lakhs. During his cross-
examination, when the financial capacity to pay ₹ 6 lakhs to the accused was questioned, there was no satisfactory reply given by the complainant. The evidence on record, thus, is a probable defence on behalf of the accused, which shifted the burden on the complainant to prove his financial capacity and other facts."
15. In that light, it is contended that the very materials produced by the appellant and the answers relating to ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 24 Neutral Citation No. ( 2024:HHC:8786 ) lack of knowledge of property details by PW-1 in his cross-examination would indicate that the transaction is doubtful and no evidence is tendered to indicate that the amount was paid. In such an event, it was not necessary .
for the respondent to tender rebuttal evidence but the case put forth would be sufficient to indicate that the respondent has successfully rebutted the presumption.
16. On the position of law, the provisions referred to in Sections 118 and 139 of N.I. Act as also the enunciation of law as made by this Court needs no reiteration as there is no ambiguity whatsoever. In, Basalingappa vs. Mudibasappa (supra) relied on by the learned counsel for the respondent, though on facts the ultimate conclusion therein was against raising presumption, the facts and circumstances are entirely different as the transaction between the parties as claimed in the said case is peculiar to the facts of that case where the consideration claimed to have been paid did not find favour with the Court keeping in view the various transactions and extent of the amount involved. However, the legal position relating to presumption arising under Sections 118 and 139 of N.I. Act on a signature being admitted has been reiterated. Hence, whether there is a rebuttal or not would depend on the facts and circumstances of each case.
30. This position was reiterated in Tedhi Singh vs. Narayan Dass Mahant 2022 (6) SCC 735 wherein it was held:
7. It is true that this is a case under Section 138 of the Negotiable Instruments Act. Section 139 of the N.I. Act provides that the Court shall presume that the holder of a cheque received the cheque of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability. This presumption, however, is expressly made subject to the position being proved to the contrary. In other words, it is open to the accused to establish that there is no consideration received. It is in the context of this provision that the theory of 'probable ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 25 Neutral Citation No. ( 2024:HHC:8786 ) defence' has grown. In an earlier judgment, in fact, which has also been adverted to in Basalingappa (supra), this Court notes that Section 139 of the N.I. Act is an example of reverse onus [see (2010) 11 SCC 441). It is also true that .
this Court has found that the accused is not expected to discharge an unduly high standard of proof. It is accordingly that the principle has developed that all which the accused needs to establish is a probable defence. As to whether a probable defence has been established is a matter to be decided on the facts of each case on the conspectus of evidence and circumstances that exist.
31. Similar is the judgment in P. Rasiya v. Abdul Nazer, 2022 SCC OnLine SC 1131 wherein it was observed:
"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."
32. This position was reiterated in Rajesh Jain v. Ajay Singh, (2023) 10 SCC 148: 2023 SCC OnLine SC 1275 wherein it was observed at page 161:
::: Downloaded on - 19/09/2024 20:31:40 :::CIS 26Neutral Citation No. ( 2024:HHC:8786 )
33. The NI Act provides for two presumptions: Section 118 and Section 139. Section 118 of the Act inter alia directs that it shall be presumed until the contrary is proved, that every negotiable instrument was made or drawn for .
consideration. Section 139 of the Act stipulates that "unless the contrary is proved, it shall be presumed, that the holder of the cheque received the cheque, for the discharge of, whole or part of any debt or liability". It will be seen that the "presumed fact" directly relates to one of the crucial ingredients necessary to sustain a conviction under Section 138. [The rules discussed hereinbelow are common to both the presumptions under Section 139 and Section 118 and are hence, not repeated--reference to one can be taken as reference to another]
34. Section 139 of the NI Act, which takes the form of a "shall presume" clause is illustrative of a presumption of law. Because Section 139 requires that the Court "shall presume" the fact stated therein, it is obligatory on the Court to raise this presumption in every case where the factual basis for the raising of the presumption has been established. But this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary as is clear from the use of the phrase "unless the contrary is proved".
35. The Court will necessarily presume that the cheque had been issued towards the discharge of a legally enforceable debt/liability in two circumstances. Firstly, when the drawer of the cheque admits issuance/execution of the cheque and secondly, in the event where the complainant proves that the cheque was issued/executed in his favour by the drawer. The circumstances set out above form the fact(s) which bring about the activation of the presumptive clause. [Bharat Barrel & Drum Mfg. Co. v. Amin Chand Payrelal [Bharat Barrel & Drum Mfg. Co. v. Amin Chand Payrelal, (1999) 3 SCC 35]"
33. Therefore, the Court has to start with the presumption that the cheque was issued in discharge of legal ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 27 Neutral Citation No. ( 2024:HHC:8786 ) liability and the burden is upon the accused to prove the contrary.
.
34. In the present case, the accused did not step into the witness box and the cross-examination of the complainant was not sufficient to rebut the presumption. It was held in Sumeti Vij vs. Paramount Tech Fab Industries AIR 2021 SC 1281 that the accused has to lead defence evidence to rebut the presumption and mere denial in his statement under Section 313 is not sufficient to rebut the presumption. It was observed:
"21. That apart, when the complainant exhibited all these documents in support of his complaints and recorded the statement of three witnesses in support thereof, the appellant recorded her statement under Section 313 of the Code but failed to record evidence to disprove or rebut the presumption in support of her defence available under Section 139 of the Act. The statement of the accused recorded under Section 313 of the Code is not substantive evidence of defence, but only an opportunity for the accused to explain the incriminating circumstances appearing in the prosecution case of the accused. Therefore, there is no evidence to rebut the presumption that the cheques were issued for consideration." (Emphasis supplied)"
35. Therefore, learned Courts below had rightly held that the accused had failed to rebut the presumption of consideration attached to the cheque.
::: Downloaded on - 19/09/2024 20:31:40 :::CIS 28Neutral Citation No. ( 2024:HHC:8786 )
36. It was submitted that the complainant had taken a security cheque from the accused and had misused it. This .
submission cannot be accepted. The complainant denied in his cross-examination that the accused had issued a security cheque to him. A denied suggestion does not amount to any proof. The accused did not step into the witness box to prove this version. Hence, there is no proof that the accused had issued a security cheque to the complainant.
37. The complainant proved the memo of dishonour (Ex.CW1/A) which shows that the cheque was dishonoured due to insufficient funds. A memo of dishonour carries with it a presumption of correctness under Section 146 of the N I Act and no evidence was produced by the accused to rebut this presumption; hence, the learned Trial Court below had rightly held that the cheque was dishonoured due to 'insufficient funds'.
38. The complainant stated that he had issued a legal notice to the accused asking him to pay the amount within 15 days from the date of receipt of the notice. The acknowledgement (Ex.CW1/F) shows that it was returned with ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 29 Neutral Citation No. ( 2024:HHC:8786 ) the signatures of the accused. Thus, it was proved that the notice was served upon the accused.
.
39. Therefore, all the ingredients of the commission of an offence punishable under Section 138 of the NI Act were satisfied and the learned Courts below had rightly convicted the accused.
40. The Learned Trial Court had sentenced the accused to undergo simple imprisonment for one year and to pay compensation of ₹3.00 lacs and in default of payment of fine to undergo simple imprisonment of one month.
41. It was laid down by the Hon'ble Supreme Court in Bir Singh v. Mukesh Kumar, (2019) 4 SCC 197: (2019) 2 SCC (Cri) 40 :
(2019) 2 SCC (Civ) 309: 2019 SCC OnLine SC 138 that the penal provision of section 138 is a deterrent in nature. It was observed at page 203:
"6. The object of Section 138 of the Negotiable Instruments Act is to infuse credibility into negotiable instruments including cheques and to encourage and promote the use of negotiable instruments including cheques in financial transactions. The penal provision of Section 138 of the Negotiable Instruments Act is intended to be a deterrent to callous issuance of negotiable instruments such as cheques without serious intention to honour the promise implicit in the issuance of the same."::: Downloaded on - 19/09/2024 20:31:40 :::CIS 30
Neutral Citation No. ( 2024:HHC:8786 )
42. In view of this consideration, the sentence of one year is not excessive.
.
43. The cheque was issued on 22.1.2019. The sentence was imposed by the learned Trial Court on 18.11.2022 after the lapse of more than three years. The complainant had to engage the counsel and pay him the legal fee. He lost interest in the amount so advanced by him. It was laid down by the Hon'ble Supreme Court in Kalamani Tex v. P. Balasubramanian, (2021) 5 SCC 283: (2021) 3 SCC (Civ) 25: (2021) 2 SCC (Cri) 555: 2021 SCC OnLine SC 75 that the Courts should uniformly levy a fine up to twice the cheque amount along with simple interest at the rate of 9% per annum. It was observed at page 291: -
19. As regards the claim of compensation raised on behalf of the respondent, we are conscious of the settled principles that the object of Chapter XVII of NIA is not only punitive but also compensatory and restitutive. The provisions of NIA envision a single window for criminal liability for the dishonour of a cheque as well as civil liability for the realisation of the cheque amount. It is also well settled that there needs to be a consistent approach towards awarding compensation and unless there exist special circumstances, the courts should uniformly levy fines up to twice the cheque amount along with simple interest @ 9% p.a. [R. Vijayan v. Baby, (2012) 1 SCC 260, para 20: (2012) 1 SCC (Civ) 79: (2012) 1 SCC (Cri) 520]"::: Downloaded on - 19/09/2024 20:31:40 :::CIS 31
Neutral Citation No. ( 2024:HHC:8786 )
44. Hence, the amount of compensation of ₹3,00,000/-
cannot be said to be excessive.
.
45. It was submitted that the learned Trial Court erred in imposing the sentence of imprisonment in case of default in the payment of compensation. This submission cannot be accepted.
It was laid down by the Hon'ble Supreme Court in K.A. Abbas v.
Sabu Joseph, (2010) 6 SCC 230: (2010) 3 SCC (Civ) 744 : (2010) 3 SCC (Cri) 127: 2010 SCC OnLine SC 612 that the Courts can impose sentence of imprisonment in default of payment of compensation. It was observed at page 237:
"20. Moving over to the question, whether a default sentence can be imposed on default of payment of compensation, this Court in Hari Singh v. Sukhbir Singh [(1988) 4 SCC 551: 1988 SCC (Cri) 984: AIR 1988 SC 2127] and in Balraj v. State of U.P. [(1994) 4 SCC 29: 1994 SCC (Cri) 823: AIR 1995 SC 1935], has held that it was open to all the courts in India to impose a sentence on default of payment of compensation under sub-section (3) of Section 357. In Hari Singh v. Sukhbir Singh [(1988) 4 SCC 551: 1988 SCC (Cri) 984: AIR 1988 SC 2127], this Court has noticed certain factors which required to be taken into consideration while passing an order under the section:
(SCC p. 558, para 11) "11. The payment by way of compensation must, however, be reasonable. What is reasonable, may depend upon the facts and circumstances of each case.
The quantum of compensation may be determined by taking into account the nature of the crime, the justness of claim by the victim and the ability of the ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 32 Neutral Citation No. ( 2024:HHC:8786 ) accused to pay. If there is more than one accused, they may be asked to pay on equal terms unless their capacity to pay varies considerably. The payment may also vary depending upon the acts of each accused. A .
reasonable period for payment of compensation, if necessary, by instalments, may also be given. The court may enforce the order by imposing sentence in default."
21. This position also finds support in R. v. Oliver John Huish [(1985) 7 Cri App R (S) 272]. The Lord Justice Croom Johnson speaking for the Bench has observed:
"When compensation orders may possibly be made the most careful examination is required. Documents should be obtained and evidence either on affidavit or orally should be given. The proceedings should, if necessary, be adjourned, in order to arrive at the true state of the defendant's affairs.
Very often a compensation order is made and a very light sentence of imprisonment is imposed, because the court recognizes that if the defendant is to have an opportunity of paying the compensation he must be enabled to earn the money with which to do so. The result is therefore an extremely light sentence of imprisonment. If the compensation order turns out to be virtually worthless, the defendant has got off with a very light sentence of imprisonment as well as no order of compensation. In other words, generally speaking, he has got off with everything."
22. The law laid down in Hari Singh v. Sukhbir Singh [(1988) 4 SCC 551: 1988 SCC (Cri) 984: AIR 1988 SC 2127] was reiterated by this Court in Suganthi Suresh Kumar v. Jagdeeshan [(2002) 2 SCC 420: 2002 SCC (Cri) 344]. The Court observed: (SCC pp. 424-25, paras 5 & 10) "5. In the said decision this Court reminded all concerned that it is well to remember the emphasis laid on the need for making liberal use of Section 357(3) of the Code. This was observed by reference to a ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 33 Neutral Citation No. ( 2024:HHC:8786 ) decision of this Court in Hari Singh v. Sukhbir Singh [(1988) 4 SCC 551: 1988 SCC (Cri) 984: AIR 1988 SC 2127]. In the said decision this Court held as follows:
(SCC p. 558, para 11) .
'11. ... The quantum of compensation may be determined by taking into account the nature of the crime, the justness of claim by the victim and the ability of the accused to pay. If there is more than one accused, they may be asked to pay on equal terms unless their capacity to pay varies considerably. The payment may also vary depending upon the acts of each accused. A reasonable period for payment of compensation, if necessary, by instalments, may also be given. The court may enforce the order by imposing sentence in default.' (emphasis in original) ***
10. That apart, Section 431 of the Code has only prescribed that any money (other than fine) payable by virtue of an order made under the Code shall be recoverable 'as if it were a fine'. Two modes of recovery of the fine have been indicated in Section 421(1) of the Code. The proviso to the sub-section says that if the sentence directs that in default of payment of the fine, the offender shall be imprisoned, and if such offender has undergone the whole of such imprisonment in default, no court shall issue such warrant for the levy of the amount."
The Court further held: (Jagdeeshan case [(2002) 2 SCC 420: 2002 SCC (Cri) 344], SCC p. 425, para 11) "11. When this Court pronounced in Hari Singh v. Sukhbir Singh [(1988) 4 SCC 551: 1988 SCC (Cri) 984: AIR 1988 SC 2127] that a court may enforce an order to pay compensation 'by imposing a sentence in default' it is open to all courts in India to follow the said course. The said legal position would continue to ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 34 Neutral Citation No. ( 2024:HHC:8786 ) hold good until it is overruled by a larger Bench of this Court. Hence learned Single Judge of the High Court of Kerala has committed an impropriety by expressing that the said legal direction of this Court should not be .
followed by the subordinate courts in Kerala. We express our disapproval of the course adopted by the said Judge in Rajendran v. Jose [(2001) 3 KLT 431]. It is unfortunate that when the Sessions Judge has correctly done a course in accordance with the discipline the Single Judge of the High Court has incorrectly reversed it."
23. In order to set at rest the divergent opinion expressed in Ahammedkutty case [(2009) 6 SCC 660 : (2009) 3 SCC (Cri) 302], this Court in Vijayan v. Sadanandan K. [(2009) 6 SCC 652 : (2009) 3 SCC (Cri) 296], after noticing the provision of Sections 421 and 431 CrPC, which dealt with mode of recovery of fine and Section 64 IPC, which empowered the courts to provide for a sentence of imprisonment on default of payment of fine, the Court stated: (Vijayan case [(2009) 6 SCC 652 : (2009) 3 SCC (Cri) 296], SCC p. 658, para 24) "24. We have carefully considered the submissions made on behalf of the respective parties. Since a decision on the question raised in this petition is still in a nebulous state, there appear to be two views as to whether a default sentence of imprisonment can be imposed in cases where compensation is awarded to the complainant under Section 357(3) CrPC. As pointed out by Mr Basant in Dilip S. Dahanukar case [(2007) 6 SCC 528 : (2007) 3 SCC (Cri) 209], the distinction between a fine and compensation as understood under Section 357(1)(b) and Section 357(3) CrPC had been explained, but the question as to whether a default sentence clause could be made in respect of compensation payable under Section 357(3) CrPC, which is central to the decision in this case, had not been considered."
::: Downloaded on - 19/09/2024 20:31:40 :::CIS 35Neutral Citation No. ( 2024:HHC:8786 ) The Court further held: (Vijayan case [(2009) 6 SCC 652 :
(2009) 3 SCC (Cri) 296], SCC p. 659, paras 31-32) "31. The provisions of Sections 357(3) and 431 CrPC, .
when read with Section 64 IPC, empower the court, while making an order for payment of compensation, to also include a default sentence in case of non- payment of the same.
32. The observations made by this Court in Hari Singh case [(1988) 4 SCC 551: 1988 SCC (Cri) 984: AIR 1988 SC 2127] are as important today as they were when they were made and if, as submitted by Dr. Pillay, recourse can only be had to Section 421 CrPC for enforcing the same, the very object of sub-section (3) of Section 357 would be frustrated and the relief contemplated therein would be rendered somewhat illusory."
24. In Shantilal v. State of M.P. [(2007) 11 SCC 243 : (2008) 1 SCC (Cri) 1], it is stated, that, the sentence of imprisonment for default in payment of a fine or compensation is different from a normal sentence of imprisonment. The Court also delved into the factors to be taken into consideration while passing an order under Section 357(3) CrPC. This Court stated: (SCC pp. 255-56, para 31) "31. ... The term of imprisonment in default of payment of a fine is not a sentence. It is a penalty which a person incurs on account of non-payment of a fine. The sentence is something which an offender must undergo unless it is set aside or remitted in part or in whole either in appeal or in revision or other appropriate judicial proceedings or 'otherwise'. A term of imprisonment ordered in default of payment of a fine stands on a different footing. A person is required to undergo imprisonment either because he is unable to pay the amount of fine or refuses to pay such amount. He, therefore, can always avoid to undergo imprisonment in default of payment of fine by paying such amount. It is, therefore, not only the power but ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 36 Neutral Citation No. ( 2024:HHC:8786 ) the duty of the court to keep in view the nature of the offence, circumstances under which it was committed, the position of the offender and other relevant considerations before ordering the offender to suffer .
imprisonment in default of payment of a fine."
(emphasis in original)
25. In Kuldip Kaur v. Surinder Singh [(1989) 1 SCC 405: 1989 SCC (Cri) 171: AIR 1989 SC 232] in the context of Section 125 CrPC observed that sentencing a person to jail is sometimes a mode of enforcement. In this regard, the Court stated: (SCC p. 409, para 6) "6. A distinction has to be drawn between a mode of enforcing recovery on the one hand and effecting actual recovery of the amount of monthly allowance which has fallen in arrears on the other. Sentencing a person to jail is a 'mode of enforcement'. It is not a 'mode of satisfaction' of the liability. The liability can be satisfied only by making actual payment of the arrears. The whole purpose of sending to jail is to oblige a person liable to pay the monthly allowance who refuses to comply with the order without sufficient cause, to obey the order and to make the payment. The purpose of sending him to jail is not to wipe out the liability which he has refused to discharge. Be it also realised that a person ordered to pay a monthly allowance can be sent to jail only if he fails to pay the monthly allowance 'without sufficient cause' to comply with the order. It would indeed be strange to hold that a person who 'without reasonable cause' refuses to comply with the order of the court to maintain his neglected wife or child would be absolved of his liability merely because he prefers to go to jail. A sentence of jail is no substitute for the recovery of the amount of monthly allowance which has fallen in arrears."
26. From the above line of cases, it becomes very clear, that, a sentence of imprisonment can be granted for ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 37 Neutral Citation No. ( 2024:HHC:8786 ) default in payment of compensation awarded under Section 357(3) CrPC. The whole purpose of the provision is to accommodate the interests of the victims in the criminal justice system. Sometimes the situation becomes .
such that there is no purpose served by keeping a person behind bars. Instead directing the accused to pay an amount of compensation to the victim or affected party can ensure delivery of total justice. Therefore, this grant of compensation is sometimes in lieu of sending a person behind bars or in addition to a very light sentence of imprisonment. Hence on default of payment of this compensation, there must be a just recourse. Not imposing a sentence of imprisonment would mean allowing the accused to get away without paying the compensation and imposing another fine would be impractical as it would mean imposing a fine upon another fine and therefore would not ensure proper enforcement of the order of compensation. While passing an order under Section 357(3), it is imperative for the courts to look at the ability and the capacity of the accused to pay the same amount as has been laid down by the cases above, otherwise, the very purpose of granting an order of compensation would stand defeated.
46. This position was reiterated in R. Mohan v. A.K. Vijaya Kumar, (2012) 8 SCC 721: (2012) 4 SCC (Civ) 585: (2012) 3 SCC (Cri) 1013: 2012 SCC OnLine SC 486 wherein it was observed at page 729:
29. The idea behind directing the accused to pay compensation to the complainant is to give him immediate relief so as to alleviate his grievance. In terms of Section 357(3), compensation is awarded for the loss or injury suffered by the person due to the act of the accused for which he is sentenced. If merely an order directing compensation is passed, it would be totally ineffective. It could be an order without any deterrence or apprehension ::: Downloaded on - 19/09/2024 20:31:40 :::CIS 38 Neutral Citation No. ( 2024:HHC:8786 ) of immediate adverse consequences in case of its non-
observance. The whole purpose of giving relief to the complainant under Section 357(3) of the Code would be frustrated if he is driven to take recourse to Section 421 of .
the Code. Order under Section 357(3) must have the potentiality to secure its observance. Deterrence can only be infused into the order by providing for a default sentence. If Section 421 of the Code puts compensation ordered to be paid by the court on a par with the fine so far as the mode of recovery is concerned, then there is no reason why the court cannot impose a sentence in default of payment of compensation as it can be done in case of default in payment of fine under Section 64 IPC. It is obvious that in view of this, in Vijayan [(2009) 6 SCC 652:
(2009) 3 SCC (Cri) 296], this Court stated that the abovementioned provisions enabled the court to impose a sentence in default of payment of compensation and rejected the submission that the recourse can only be had to Section 421 of the Code for enforcing the order of compensation. Pertinently, it was made clear that observations made by this Court in Hari Singh [(1988) 4 SCC 551: 1988 SCC (Cri) 984] are as important today as they were when they were made. The conclusion, therefore, is that the order to pay compensation may be enforced by awarding a sentence in default.
30. In view of the above, we find no illegality in the order passed by the learned Magistrate and confirmed by the Sessions Court in awarding a sentence in default of payment of compensation. The High Court was in error in setting aside the sentence imposed in default of payment of compensation.
47. Thus, there is no infirmity in the order passed by the learned Trial Court imposing a sentence of imprisonment in case of default in the payment of compensation.
48. No other point was urged.
::: Downloaded on - 19/09/2024 20:31:40 :::CIS 39Neutral Citation No. ( 2024:HHC:8786 )
49. In view of the above, the judgments and order passed by learned Courts below are sustainable and no interference is .
required with them in the present revision petition.
50. Consequently, the present petition fails and the same is dismissed. Records of the learned Courts below be sent back forthwith.
19th September, 2024
(Chander)
r to (Rakesh Kainthla)
Judge
::: Downloaded on - 19/09/2024 20:31:40 :::CIS