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Moly Joy v/s Reliant Hire Purchase Company Ltd., Represented by Its Power of Attorney holder Sunilkumar, Kothamangalam & Another

    Crl. Rev. Pet. No. 701 of 2022
    Decided On, 31 October 2022
    At, High Court of Kerala
    By, THE HONOURABLE MR. JUSTICE A. BADHARUDEEN
    For the Petitioner: P.V. Elias, Albin Varghese, Advocate. For the Respondents: T.R. Renjith, Sr. Public Prosecutor.


Judgment Text
1. The sole accused in C.C.No.52 of 2014 on the file of the Judicial First Class Magistrate Court-I, Kothamangalam is the revision petitioner herein and he has filed this revision petition under Sections 397 and 401 of the Code of Criminal Procedure(hereinafter will be referred as Cr.P.C. for convenience). The respondents herein are the original complainant as well as the State of Kerala.

2. Heard the learned counsel for the revision petitioner/the accused and the learned Public Prosecutor on admission. Notice to the first respondent stands dispensed with. 3. I shall refer the parties in this Revision Petition as ‘complainant’ and ‘accused’ for convenience.

4. Short facts of the case are as under: The complainant initiated prosecution alleging commission of offence punishable under Section 138 of the Negotiable Instruments Act (hereinafter will be referred as 'NI Act' for convenience), when cheque for Rs.4,75,000/- dated 21.10.2013 issued by the accused in favour of the complainant, who stood as a guarantor for one Mr.Josil K.Joy for availing hire purchase loan agreement, was dishonoured, when it was presented for collection. After dishonour of the cheque, the complainant issued legal notice of demand and the accused failed to repay the same even after notice.

5. The trial court secured the presence of the accused for trial and proceeded with trial. During trial, PW1 examined and Exts.P1 to P12 were marked on the side of the complainant.

6. After questioning the accused under Section 313(1)(b) of Cr.P.C, though opportunity was provided to the accused to adduce defence evidence, no defence evidence was adduced.

7. Thereafter, the trial court given emphasis to the evidence of PW1 to hold that the transaction led to execution of the cheque was proved by the evidence of PW1, since the evidence adduced by PW1 was not shaken during cross-examination. Accordingly, the trial court given benefit of presumptions in favour of the complainant and the accused was convicted for the offence punishable under Section 138 of the NI Act. Accordingly, he was sentenced to undergo simple imprisonment for a period of one year and to pay a fine of Rs.5,00,000/-. Fine was ordered to be given as compensation to the complainant and default imprisonment for a period of six months was imposed, on failure to pay the compensation.

8. The accused assailed the conviction and sentence as above before the Sessions Court and Additional Sessions Court, Muvattupuzha, as per judgment in Crl.Appeal No.351 of 2019 dated 30.07.2022, confirmed the conviction, while modifying the sentence. The appellate court modified the sentence so that the substantive sentence of imprisonment was reduced to a day till rising of the court and to pay compensation of Rs.5,00,000/-. In default of payment of compensation, imprisonment for a period of six months also was imposed.

9. The accused, who is aggrieved by the concurrent verdicts, has approached this Court. The learned counsel for the accused argued that the courts below ought to have found that Ext.P7 cheque was issued by the complainant as a blank signed cheque towards security and it was not issued for any consideration. It is argued further that since the complainant has no case that the principle borrower failed to repay the loan amount, the guarantor/accused has no liability to pay the amount.

10. In fact, the argument advanced by the learned counsel for the accused that the cheque was issued as blank signed cheque towards security is a matter to be decided on the basis of appreciation of evidence. In fact, the trial court as well as the appellate court appreciated and re-appreciated the evidence and finally, negatived the contention raised by the accused that Ext.P7 cheque was issued as a security as blank signed one. The second point argued by the learned counsel for the accused that since the complainant has no case that the principle borrower failed to repay the loan amount, the accused, who is the guarantor of the loan has no liability, is unsustainable. Insofar as debt involving principle debtor and guarantor/guarantors, the liability is joint or several and therefore, either the principle debtor or the guarantor can be proceeded legally. That apart, in this case, the specific case of the complainant itself is that the principle debtor failed to pay the amount and the guarantor issued cheque to discharge the said liability. Thus, this argument cannot be appreciated.

11. In this case, the trial court as well as the appellate court given reliance to the evidence of PW1 to find that the complainant discharged his initial burden in the matter of proof of transaction led to execution of Ext.P7 cheque. Ext.P1, certificate of incorporation, Ext.P5, the hire purchase agreement dated 14.12.2010 and Ext.P6, hire purchase loan register alleged to be containing the signature of the accused also was proved by the court below. In fact, the accused herein admitted issuance of cheque as a guarantor, but his contention is that he had issued the same as a blank signed one towards security. But the said contention not proved in any manner is the finding of the courts below.

12. It is the settled law that, when the complainant discharged his initial burden in the matter of transaction led to execution of the cheque, he would get twin presumptions in his favour. Law regarding presumptions is also settled as well.

13. In this connection, I would like to refer a 3 Bench decision of the Apex Court in [2010 (2) KLT 682 (SC)], Rangappa v. Sri.Mohan. In the above decision, the Apex Court considered the presumption available to a complainant in a prosecution under Section 138 of the N.I Act and held as under:

“The presumption mandated by S.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 (1) KLT 425 (SC)] may not be correct. 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. S.139 of the Act 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 S.138 of the Act specified a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under S.139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by S.138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact 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 accused/defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under S.139, the standard of proof for doing so is that of `preponderance of probabilities'. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. Accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own.”

14. In the decision reported in [2019 (1) KLT 598 (SC) : 2019 (1) KHC 774 : (2019) 4 SCC 197 : 2019 (1) KLD 420 : 2019 (2) KLJ 205 : AIR 2019 SC 2446 : 2019 CriLJ 3227], Bir Singh v. Mukesh Kumar, the Apex Court while dealing with a case where the accused has a contention that the cheque issued was a blank cheque, it was held as under:

“A meaningful reading of the provisions of the Negotiable Instruments Act including, in particular, Sections 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of S.138 would be attracted. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence.”

15. In a latest 3 Bench decision of the Apex Court reported in [2021 (2) KHC 517 : 2021 KHC OnLine 6063 : 2021 (1) KLD 527 : 2021 (2) SCALE 434 : ILR 2021 (1) Ker. 855 : 2021 (5) SCC 283 : 2021 (1) KLT OnLine 1132], M/s.Kalamani Tex & anr. v. P.Balasubramanian the Apex Court considered the amplitude of presumptions under Sections 118 and 139 of the N.I Act it was held as under:

“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 S.118 and S.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 presumption imposed upon him. 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 Complainant-Respondent to explain the circumstances under which the appellants were liable to pay.

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18. Even if we take the arguments raised by the appellants at face value that only a blank cheque and signed blank stamp papers were given to the respondent, yet the statutory presumption cannot be obliterated. It is useful to cite Bir Singh v. Mukesh Kumar (2019 (1) KHC 774 : (2019) 4 SCC 197 : 2019 (1) KLD 420 : 2019 (1) KLT 598 : 2019 (2) KLJ 205 : AIR 2019 SC 2446 : 2019 CriLJ 3227], P.36., where this Court held that:

“Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under S.139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt.”

16. Thus the law is clear on the point that when the complainant discharged the initial burden to prove the transaction led to execution of the cheque, the presumption under Sections 118 and 139 of the N.I Act would come into play. No doubt, these presumptions are rebuttable and it is the duty of the accused to rebut the presumptions and the standard of proof of rebuttal is nothing but preponderance of probabilities.

17. In the decision in Kalamani Tex's case (Supra), the Apex Court held that even a blank cheque leaf, voluntarily signed and handed over by the accused which is towards some payment also would attract presumption under Section 139 of the NI Act. Therefore, the said contention rightly negatived by the trial court as well as the appellate court could not be faulted at all.

18. Coming to the power of this Court in the matter of exercising revision, the law is well settled. It is the settled law that power of revision available to this Court under Section 401 of Cr.P.C r/w Section 397 is not wide and exhaustive to re-appreciate the evidence to have a contra finding. In the decision reported in [(1999) 2 SCC 452 : 1999 SCC (Cri) 275], State of Kerala v. Puttumana Illath Jathavedan Namboodiri, the Apex Court, while considering the scope of the revisional jurisdiction of the High Court, laid down the following principles (SCC pp. 454-55, para 5):

“5. …... 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 reappreciate the evidence and come to its own conclusion on the same when the evidence has already been appreciated by the Magistrate as well as the 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. On scrutinising the impugned judgment of the High Court from the aforesaid standpoint, we have no hesitation to come to the conclusion that the High Court exceeded its jurisdiction in interfering with the conviction of the respondent by reappreciating the oral evidence. ...”

19. In another decision reported in [(2015) 3 SCC 123 : (2015) 2 SCC (Cri) 19], Sanjaysinh Ramrao Chavan v. Dattatray Gulabrao Phalke, the Apex Court held that the High Court in exercise of revisional jurisdiction shall not interfere with the order of the Magistrate unless it is perverse or wholly unreasonable or there is nonconsideration of any relevant material, the order cannot be set aside merely on the ground that another view is possible. Following has been laid down in para.14 (SCC p.135) :

“14. …... Unless the order passed by the Magistrate is perverse or the view taken by the court is wholly unreasonable or there is non-consideration of any relevant material or there is palpable misreading of records, the Revisional Court is not justified in setting aside the order, merely because another view is possible. The Revisional Court is not meant to act as an appellate court. The whole purpose of the revisional jurisdiction is to preserve the power in the court to do justice in accordance with the principles of criminal jurisprudence. The revisional power of the court under Sections 397 to 401 Cr.P.C is not to be equated with that of an appeal. Unless the finding of the court, whose decision is sought to be revised, is shown to be perverse or untenable in law or is grossly erroneous or glaring unreasonable or where the decision is based on no material or where the material facts are wholly ignored or where the judicial discretion is exercised arbitrarily or capriciously, the courts may not interfere with decision in exercise of their revisional jurisdiction.”

20. The said ratio has been followed in a latest decision of the Supreme Court reported in [(2018) 8 SCC 165], Kishan Rao v. Shankargouda. Thus the law is clear on the point that the whole purpose of the revisional jurisdiction is to preserve power in the court to do justice in accordance with the principles of criminal jurisprudence and, 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 had already been

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appreciated by the Magistrate as well as the Sessions Judge in appeal, unless any glaring feature is brought to the notice of the court which would otherwise tantamount to gross miscarriage of justice. To put it otherwise, if there is non-consideration of any relevant materials, which would go to the root of the matter or any fundamental violation of the principle of law, then only the power of revision would be made available. 21. In this matter, it is to be noted that nothing available to interfere with the concurrent verdicts, by exercising power of revision. To the contrary, it appears that the courts below rightly entered into conviction and sentence. Therefore, I am not inclined to interfere in the conviction and sentence in any manner. 22. Faced with the situation, the learned counsel for the accused sought for six months time to pay the amount. Considering the fine amount would come to Rs.4,75,000/- and in consideration of the fact that the transaction was in the year 2013, I am inclined to grant two months time from today to pay the compensation. 23. In the result, this revision petition fails and it is, accordingly, dismissed. However, the revision petitioner/the accused is given two months time from today to pay the compensation and to undergo the sentence. Therefore, the revision petitioner/the accused is directed to appear before the trial court on 30.12.2022 to pay the compensation and to undergo the sentence. The execution of the sentence shall stand deferred till 29.12.2022. On failure to do so, the trial court is directed to execute the sentence without fail. Registry is directed to forward a copy of this order to the court below concerned for information.
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