Sree Gokulam Chit and Finance Co. Pvt. Ltd. vs T.V. Ganeshan and State of Kerala

Justice V.K. Mohanan

The complainant in a prosecution for the offence punishable u/s 138 of the Negotiable Instruments Act, 1881 (for short ''the N.I. Act'') is the appellant as it is aggrieved by the order dated 02/02/2009 in S.T. No. 84 of 2007 of the court of the Judicial Magistrate of the First Class-IV, Kozhikode by which the learned Magistrate acquitted the accused u/s 255(1) of the Cr.P.C. The case of the complainant is that, it is a private limited company conducting chitty business and the accused was one of the subscribers of a chit bearing No. GGF 155/05 and the accused auctioned the chit and received the prize amount but defaulted in paying the installment amount and subsequently towards the discharge of that liability the accused issued Ext. P1 cheque for an amount of Rs. 23,260/- which, when presented for encashment, was dishonoured and returned on 31/08/2006 with a memo stating the reason as ''account closed on advice''. According to the complainant, though a formal statutory demand notice was served on the accused, no amount was paid and therefore the accused committed the offence punishable u/s 138 of the N.I. Act. During the trial of the case, PW.1 was examined for and on behalf of the complainant and produced Exts. P1 to P9 documents. No evidence is adduced from the side of the defence. The trial court, after considering the evidence, found that neither the execution of the cheque nor the existence of debt is proved by the complainant. On the basis of the above, the accused was acquitted u/s 255(1) of Cr.P.C. It is the above finding and order of acquittal that are challenged in this appeal.

I have heard SRI. Lakshmi B. Shenoy, the learned counsel for the appellant and also SRI. Sunny Mathew, learned counsel appearing for the first respondent.

The learned counsel for the appellant vehemently submitted that, though no reply was given by the accused to the statutory notice served on him, during the trial of the case a contention has been raised to the effect that Ext. P1 cheque is drawn not on an account maintained by the accused, but no evidence is produced to substantiate such contention. According to the learned counsel, the accused has not disputed the chitty transaction with the complainant and has also not disputed the receipt of the chitty prize amount. It is the further contention of the learned counsel that, Ext. P2 dishonoured memo was issued by the bank not for the reason that signature differs and the cheque does not belong to the account of the accused. So, according to the learned counsel, the above circumstances show that the complainant has succeeded in proving its case, but the learned Magistrate overlooking those facts came into a wrong conclusion and accordingly acquitted the accused. Therefore, the counsel submits that, the finding of the learned Judge of the trial court is liable to be interfered with and the order of acquittal is liable to be reversed and consequently the accused is liable to be convicted.

On the other hand, the learned counsel for the respondent submitted that, there is no evidence and material to show that Ext. P1 cheque belongs to the account maintained by the accused. It is also the submission of the learned counsel that, the complainant has miserably failed to prove the liability of the accused due to the complainant and therefore the trial court is fully justified in its finding and no interference is warranted.

I have carefully considered the arguments advanced by the learned counsel for the appellant and the respondent and I have also gone through the judgment of the trial court.

In paragraph 11 of the impugned judgment the learned Magistrate has found that, though the complainant has proved that the cheque was dishonoured on account of insufficiency of fund and statutory notice was issued, the complainant has not proved that the cheque was drawn on an account maintained by the accused.

On a reading of Section 138 of the N.I. Act, it can be seen that, for an effective prosecution for the offence punishable u/s 138 of the N.I. Act, it is incumbent upon the complainant to prove that the dishonoured cheque pertains to an account maintained by the accused. In this juncture, it is relevant to note that, though no reply was sent, during the cross-examination of PW.1, as observed by the learned Magistrate in paragraph 8 of the judgment, that the defence suggested that Ext. P1 cheque is not drawn in an account maintained by the accused and the cheque obtained from some where else was misutilized and prosecution has been initiated against the accused. The learned Magistrate has also found that, when the accused was questioned u/s 313 of Cr.P.C., he filed a statement contending that Ext. P1 cheque is not drawn in his account. According to the learned Magistrate, no steps are taken by the complainant to prove that Ext. P1 cheque is drawn by the accused from an account maintained by him. The appellant has no case that they have produced any materials to prove that Ext. P1 cheque pertains to an account maintained by the accused. Therefore the essential ingredient of Section 138 of the N.I. Act is not established by the complainant by adducing any evidence. The lapse on the part of the complainant to establish that important aspect of the prosecution for the offence punishable u/s 138 of the N.I. Act cannot be salvaged by drawing presumption or inferences from the circumstances as pointed out by the counsel for the appellant. So in the present case, the complainant has miserably failed to establish, the un-shifted burden of proving the essential ingredients of Section 138 of the N.I. Act. that the cheque in question drawn from an account maintained by the accused. In the light of the above facts and finding, I am of the view that, this Court need not go into the other facts and disputes involved in this case. Thus, on examination of the findings of the court below, with respect to the point which I mentioned above, it can be seen that, the reasoning given by the learned Magistrate appears to be correct and legal and the same cannot be treated as perverse, so as to interfere in an appeal against the order of acquittal.

Therefore, the appellant has miserably failed to make out a prima facie case in support of his challenge against the finding of the court below and order of acquittal recorded in favour of the respondent. Therefore, even if this appeal is entertained any further, there is not even a remote scope to interfere with the finding of the court below and order of acquittal.

Therefore, there is no merit in this appeal and accordingly the same is dismissed.