Himachal Pradesh High Court
Khatri Ram vs The Dugana Cmp Society Limited on 22 July, 2024
Author: Sandeep Sharma
Bench: Sandeep Sharma
THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA Cr. Revision No.70 of 2024 Date of Decision: 22.07.2024 .
_______________________________________________________ Khatri Ram .......Petitioner Versus The Dugana CMP Society Limited ... Respondents _______________________________________________________ Coram:
Hon'ble Mr. Justice Sandeep Sharma, Judge.
Whether approved for reporting? 1 For the Petitioner: r Mr. Shyam Singh Chauhan, Advocate.
For the Respondents: Mr. Kush Sharma, Advocate.
_______________________________________________________ Sandeep Sharma, Judge(oral):
Instant Criminal Revision petition filed under Section 397 read with Section 401 of the Code of Criminal Procedure, lays challenge to judgment dated 06.01.2024 passed by learned Additional Sessions Judge, Paonta Sahib, District Sirmour, Himachal Pradesh in Criminal Appeal No.42 of 2023, affirming the judgment of conviction and order of sentence dated 28.04.2023 passed by learned Judicial Magistrate, First Class, Shillai, District Sirmour, H.P., in Criminal complaint No. 88/3 of 2019, titled as The Dugana CMP Society limited vs. Khatri Ram, whereby learned trial Court, while holding petitioner-accused guilty of having committed an offence punishable under Section 138 of the Negotiable Instruments Act, convicted and 1 Whether the reporters of the local papers may be allowed to see the judgment?::: Downloaded on - 24/07/2024 20:30:34 :::CIS 2
sentenced him to undergo simple imprisonment for a period of six months and pay compensation to the tune of Rs.59,198/- to the .
respondent-complainant.
2. Precisely, the facts of the case, as emerge from the record are that respondent-complainant (for short 'complainant') filed a complaint under Section 138 of the Negotiable Instruments Act (for short 'Act') in the competent Court of law, alleging therein that on 05.06.2013 and in the first week of March, 2009, accused obtained loan of Rs. 30,000/- from the complainant-Society, but he defaulted to repay the same regularly. However, subsequently with a view to regularize his loan account, accused issued cheque bearing No.023702, dated 02.04.2019, amounting to Rs. 56,198/- drawn on State Bank of India, Kaffota Branch in favour of the complainant towards discharge of his lawful liability. However, fact remains that aforesaid cheque on its presentation to the bank concerned was dishonoured on the ground "Drawer's Signature Differs" in the account of the accused vide memo of the bank dated 03.04.2019.
After receipt of aforesaid memo, complainant served the accused with legal notice dated 26.04.2019, calling upon him to make the payment of dishonoured cheque within a period of 15 days from the receipt of notice. Though, accused received the notice, but yet he failed to make the payment good. In the aforesaid background, complainant was ::: Downloaded on - 24/07/2024 20:30:34 :::CIS 3 compelled to institute proceedings under Section 138 of the Act in the competent Court of law, which subsequently on the basis of the .
pleadings as well as evidence adduced on record by the respective parties, held accused guilty of his having committed offence punishable under Section 138 of the Act, and accordingly convicted and sentenced him, as per the description given hereinabove.
3. Though, at first instance being aggrieved and dissatisfied with the aforesaid judgment of conviction and order of sentence recorded by learned trial court, present petitioner-accused preferred an appeal in the Court of learned Additional Sessions Judge Paonta Sahib, District Sirmour, Himachal Pradesh, but same also came to be dismissed vide judgment dated 06.01.2024. In the aforesaid background, petitioner has approached this Court in the instant proceedings, praying therein for his acquittal after quashing and setting aside the impugned judgment of conviction and order of sentence passed by Courts below.
4. Vide order dated 29.01.2024, this Court suspended the substantive sentence imposed by Court below, subject to petitioner-
accused depositing 20% of the compensation amount and furnishing personal bond in the sum of Rs. 50,000/- within a period of four weeks. However, fact remains that aforesaid order never came to be complied with. On 13.06.2024, this Court came to be apprised that ::: Downloaded on - 24/07/2024 20:30:34 :::CIS 4 sum of Rs. 56, 198/- has been deposited and remaining sum of Rs. 27,000/- shall be deposited within a period of four weeks. Today, .
during the proceedings of the case, learned counsel for the petitioner apprised this Court that petitioner is not coming forward to impart instructions and as such, this Court may proceed to decide the petition on its own merit.
5. Having heard learned counsel representing the parties and perused the material available on record vis-à-vis reasoning assigned in the impugned judgments, this Court is not persuaded to agree with the submission of Mr. Shyam Singh Chauhan, learned counsel for the petitioner-accused that both the Courts below have failed to appreciate the evidence in its right perspective, rather this Court finds that both the courts below have very meticulously dealt with each and every aspect of the matter and there is no scope left for interference.
6. Admittedly, in the case at hand, at no point of time accused disputed factum of his having issued cheque as well as signature thereupon, rather his precise defence as came to be put forth is that cheque in question was issued as a security, which has been misused by the complainant. In the statement recorded under Section 313 Cr.P.C. neither accused disputed factum with regard to his having availed facility of the loan of Rs. 30,000/- nor its non-
::: Downloaded on - 24/07/2024 20:30:34 :::CIS 5payment. Since factum of issuance of cheque as well as signatures thereupon never came to be disputed, no illegality can be said to have .
been committed by the Courts below, while invoking sections 118 and 139 of the Act, which talk about presumption in favour of the holder of the cheque that cheque was issued towards discharge of lawful liability. No doubt, aforesaid presumption is rebuttable, but to rebut such presumption, accused either can refer to the documents and evidence led on record by the complainant or presumption can be rebutted by leading positive evidence, if any. However, in the instant case, despite sufficient opportunities, petitioner-accused failed to lead evidence.
7. The Hon'ble Apex Court in M/s Laxmi Dyechem V. State of Gujarat, 2013(1) RCR(Criminal), has categorically held that if the accused is able to establish a probable defence which creates doubt about the existence of a legally enforceable debt or liability, the prosecution can fail. To raise probable defence, accused can rely on the materials submitted by the complainant. Needless to say, if the accused/drawer of the cheque in question neither raises a probable defence nor able to contest existence of a legally enforceable debt or liability, statutory presumption under Section 139 of the Negotiable Instruments Act, regarding commission of the offence comes into ::: Downloaded on - 24/07/2024 20:30:34 :::CIS 6 play. It would be profitable to reproduce relevant paras No.23 to 25 of the judgment herein:-
.
"23. Further, a three judge Bench of this Court in the matter of Rangappa vs. Sri Mohan [3] held that Section 139 is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies the strong criminal remedy in relation to the dishonour of the cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. The Court however, further observed that it must be remembered that the offence made punishable by Section 138can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose money is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the defendant accused cannot be expected to discharge an unduly high standard of proof". The Court further observed that it is a settled position that when an accused has to rebut the presumption under Section 139, the standard of proof for doing so is all preponderance of probabilities.
24. Therefore, if the accused is able to establish a probable defence which creates doubt about the existence of a legally enforceable debt or liability, the prosecution can fail. The accused can rely on the materials submitted by the complainant in order to raise such a defence and it is inconceivable that in some cases the accused may not need to adduce the evidence of his/her own. If however, the accused/drawer of a cheque in question neither raises a probable defence nor able to contest existence of a legally enforceable debt or liability, obviously statutory presumption under Section 139 of the NI Act regarding commission of the offence comes into play if the same is not rebutted with regard to the materials submitted by the complainant.::: Downloaded on - 24/07/2024 20:30:34 :::CIS 7
25. It is no doubt true that the dishonour of cheques in order to qualify for prosecution under Section 138 of the NI Act precedes a statutory notice where the drawer is called upon by allowing him to avail the opportunity to arrange .
the payment of the amount covered by the cheque and it is only when the drawer despite the receipt of such a notice and despite the opportunity to make the payment within the time stipulated under the statute does not pay the amount, that the said default would be considered a dishonour constituting an offence, hence punishable. But even in such cases, the question whether or not there was lawfully recoverable debt or liability for discharge whereof the cheque was issued, would be a matter that the trial court will have to examine having regard to the evidence adduced before it keeping in view the statutory presumption that unless rebutted, the cheque is presumed to have been issued for a valid consideration. In view of this the responsibility of the trial judge while issuing summons to conduct the trial in matters where there has been instruction to stop payment despite sufficiency of funds and whether the same would be a sufficient ground to proceed in the matter, would be extremely heavy.
8. In the case at hand, complainant, while examining himself as CW-1 tendered his evidence by way of affidavit Ex. CW1/A. He successfully proved on record bank slip Ex. CW1/B, Memo Ex. CW1/C, cheque Ex.CW1/D, return memo Ex. CW1/E, legal notice Ex. CW1/F, post receipt Ex.CW1/G, track consignment report Ex. CW1/H, Authority letter Ex. CW1/I and copy of registration Ex. CW1/J. If cross-examination conducted upon this witness is perused in its entirety, it can be safely concluded that accused was unable to extract something contrary to what this witness stated in his examination-in-chief. Though, accused, while cross-examining the ::: Downloaded on - 24/07/2024 20:30:34 :::CIS 8 complainant, attempted to carve out a case that Secretary of the Society was not authorized to file case on behalf of the Society, but .
CW-1, complainant specifically admitted that Ex, CW1/I is the resolution of the society and it does not bear the signatures of President, cashier or any other member, but he explained that only Secretary signs the resolution. He specifically denied that Ex. CW1/I does not authorize him to file cases. He admitted that Secretary of the Society cannot authorize himself to file cases in the Court. He further admitted that he had filed present complaint in the month of May, 2019, but denied that accused owns share of Rs. 10,000/- in the Society and self stated that he owns share of Rs. 3000/- only.
9. Perusal of cheque Ex. CW1/D, clearly reveals that cheque was issued by the accused. Accused at no point of time disputed factum with regard to his having issued cheque. Cheque returning memo Ex.CW1/E, clearly reveals that cheque was dishonoured on the ground of "Drawer's Signatures Differs'. Accused in his statement recorded under Section 313 Cr.P.C., admitted factum with regard to his having issued cheque, may be as a security.
Moreover, this Court finds that at no point of time signature, if any, ever came to be disputed by the petitioner-accused.
10. Though, accused denied that cheque in question was issued by him towards discharge of his legal liability, but he was ::: Downloaded on - 24/07/2024 20:30:34 :::CIS 9 unable to explain that under what circumstances and for what reason cheque in question was issued as a security cheque. Accused .
categorically admitted factum with regard to his having received legal notice Ex. CW1/F, but yet he failed to reply the same. At no point of time, he refuted his liability in terms of legal notice. Once he failed to reply the legal notice, it amounts admission on his part, especially with regard to liability. At no point of time, evidence, if any, ever came to be led on record on behalf of the accused to prove that cheque in question was misused by the complainant.
11. By now it is well settled that dishonour of cheque issued as security can also attract offence under Section 138 of the Negotiable Instruments Act. Hon'ble Apex Court in case titled Sripati Singh v. State of Jharkhand, Criminal Appeal No. 1269-1270 of 2021, decided on 28.10.2021, has held as under:
"16. A cheque issued as security pursuant to a financial transaction cannot be considered as a worthless piece of paper under every circumstance. 'Security' in its true sense is the state of being safe and the security given for a loan is something given as a pledge of payment. It is given, deposited or pledged to make certain the fulfilment of an obligation to which the parties to the transaction are bound. If in a transaction, a loan is advanced and the borrower agrees to repay the amount in a specified timeframe and issues a cheque as security to secure such repayment; if the loan amount is not repaid in any other form before the due date or if there is no other understanding or agreement between the parties to defer the payment of amount, the cheque which is issued as security would mature for presentation and the drawee of the cheque would be entitled to present the same. On such presentation, if the same is dishonoured, the consequences contemplated under Section 138 and the other provisions of N.I. Act would flow.::: Downloaded on - 24/07/2024 20:30:34 :::CIS 10
12. Needless to say, expression "Security cheque" is not a statutorily defined expression in the Negotiable Instruments Act, .
rather same is to be inferred from the pleadings as well as evidence, if any, led on record with regard to issuance of security cheque. The Negotiable Instruments Act does not per se carve out an exception in respect of a "security cheque" to say that a complaint in respect of such a cheque would not be maintainable as there is a debt existing in respect whereof the cheque in question is issued, same would attract provision of Section 138 of the Act in case of its dishonour.
13. CW-1, Attar Singh, vide his statement made on oath specifically deposed that he had sent the legal notice by way of register post Ex. CW1/F through postal receipt Ex.CW1/G to the accused and same was delivered to the accused as the track consignment report Ex. CW1/H confirms its delivery to the accused.
14. Leaving everything aside, admission made by the accused, while making statement under Section 313 Cr.P.C that he had given the cheque in question to the complainant as security clearly establishes his liability towards complainant. Though, objection came to be taken at the behest of the accused that signature of him do not match with the signature upon the cheque, but once factum with regard to his having issued cheque has been nowhere disputed, Court below rightly invoked Section 139 of the Act, to hold that there ::: Downloaded on - 24/07/2024 20:30:34 :::CIS 11 is presumption in favour of the complainant that cheque in question was issued towards discharge of lawful liability .
15. Though, Mr. Shyam Singh Chauhan, learned counsel for the petitioner, vehemently argued that complainant was not competent to file complaint on behalf of the respondent-society, however he was unable to dispute statement given by the accused under Section 313 Cr.P.C, wherein he, while answering question No.7, specifically admitted that complainant was authorized to file his complaint. On account of aforesaid admission, objection with regard to competency of complainant to file complaint, sought to be raised by learned counsel for the petitioner, deserves outright rejection.
16. Having scanned the entire evidence adduced on record by the respective parties, this Court finds that all the basic ingredients of Section 138 of the Act stand met in the case at hand. Similarly factum with regard to signatures and issuance of cheque by the accused towards discharge of lawful liability stands duly established on record.
17. Moreover, this Court has a very limited jurisdiction under Section 397 of the Cr.P.C, to re-appreciate the evidence, especially, in view of the concurrent findings of fact and law recorded by the courts below. In this regard, reliance is placed upon the judgment passed by Hon'ble Apex Court in case "State of Kerala Vs. ::: Downloaded on - 24/07/2024 20:30:34 :::CIS 12 Puttumana Illath Jathavedan Namboodiri" (1999) 2 Supreme Court Cases 452, wherein it has been held as under:-
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"In its revisional jurisdiction, the High Court can call for and examine the record of any proceedings for the purpose of satisfying itself as to the correctness, legality or propriety of any finding, sentence or order. In other words, the jurisdiction is one of supervisory jurisdiction exercised by the High Court for correcting miscarriage of justice. But the said revisional power cannot be equated with the power of an appellate court nor can it be treated even as a second appellate jurisdiction. Ordinarily, therefore, it would not be appropriate for the High Court to re-appreciate the evidence and come to its own conclusion on the same when the evidence has already been appreciated by the Magistrate as well as Sessions Judge in appeal, unless any glaring feature is brought to the notice of the High Court which would otherwise tantamount to gross miscarriage of justice."
18. Since after having carefully examined the evidence in the present case, this Court is unable to find any error of law as well as fact, if any, committed by the courts below, while passing impugned judgments, there is no occasion, whatsoever, to exercise the revisional power.
19. True it is that the Hon'ble Apex Court in Krishnan and another Versus Krishnaveni and another, (1997) 4 Supreme Court Case 241; has held that in case Court notices that there is a failure of justice or misuse of judicial mechanism or procedure, sentence or order is not correct, it is salutary duty of the High Court to prevent the abuse of the process or miscarriage of justice or to correct irregularities/ incorrectness committed by inferior criminal court in its judicial process or illegality of sentence or order, but learned counsel representing the accused has failed to point out any ::: Downloaded on - 24/07/2024 20:30:34 :::CIS 13 material irregularity committed by the courts below while appreciating the evidence and as such, this Court sees no reason to interfere with .
the well reasoned judgments passed by the courts below.
20. Consequently, in view of the discussion made herein above as well as law laid down by the Hon'ble Apex Court, this Court sees no valid reason to interfere with the well reasoned judgments recorded by the courts below, which otherwise, appear to be based upon proper appreciation of evidence available on record and as such, same are upheld.
21. Accordingly, the present criminal revision petition is dismissed being devoid of any merit. The petitioner is directed to surrender himself before the learned trial Court forthwith to serve the sentence as awarded by the learned trial Court, if not already served.
Bail bonds of the petitioner are cancelled and discharged accordingly.
Interim direction, if any, stands vacated. Pending applications, if any, also stand disposed of.
22. The amount, if any, deposited with the learned trial Court is ordered to be released in favour of the complainant-respondent, by remitting the same in its saving bank account, details whereof, shall be furnished by learned counsel for the respondent-complainant within a period of one week and for recovery of remaining amount, ::: Downloaded on - 24/07/2024 20:30:34 :::CIS 14 respondent-complainant may file appropriate proceedings in appropriate court of law.
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(Sandeep Sharma),
Judge
July 22, 2024
(shankar)
r to
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