THE HONBLE DR. JUSTICE B. SIVA SANKARA RAO CRIMINAL APPEAL No.1590 of 2005 and BATCH0606-2014 M/s. Appolo Tyres Ltd. Appellant M/s. H.M. Tyres and another. Respondents Counsel for the appellant : Sri M.S.N. Prasad !Counsel for Respondent Nos.1 to 3 : B. Nagi Reddy Counsel for respondent No.4 : Public Prosecutor : Cases referred:
1. AIR2003SC20352. (2000) 2 SCC3803. (2001) 8 SCC4584. (2006) 3 SCC305. (2005) 12 SCC16. (2009) 2 SCC5137. AIR2008SC13258. AIR2010SC18989. AIR2001SC389710. AIR1999SC100811. AIR2002SC18212. AIR2008SC289813. 1971 (1) An.W.R. 65 14. 2004 Crl.L.J.
58 15. 2004 (1) BC3416. Appeal (Crl.) 664 of 2002, dt.20.9.2005 17. 2014 (1) ALT (Crl.) 145 THE HONOURABLE Dr. JUSTICE B.SIVA SANKARA RAO CRIMINAL APPEAL Nos.1590, 1591, 1592, 1594, 1595, 1596, 1597, 1598, 1599, 1600, 1601, 1602, 1652, 1653 and 1654 of 2005 COMMON
JUDGMENT: The appellant-complaint M/s. Apollo Tyres Ltd., seeks to assail the 15 acquittal judgements of even dated 28.06.2001 passed by the learned IV Metropolitan Magistrate, Hyderabad, in the respective private complaint cases vide C.C.Nos.56, 57, 54, 60, 59, 52, 61, 62, 65, 63, 58, 55, 64, 51 & 53 of 2001 filed by said complainant (under Section 138 of the Negotiable Instruments Act,1881-amended by Act 66 of 1988 (for brevity 'the Act'), which came into force w.e.f., 01.04.1989. The accused in these cases are no other than the area dealers of the products of the complainant, by name M/s. H.M. Tyres, represented by Mr. Hameed Muzafaruddin(A-1), said Muzafaruddin (A-2) individually, so also Mr. Adil Moizuddin (A-3). The complainant - M/s. Apollo Tyres Ltd., filed the complaints, rep. by its employee, duly authorised (Mr. K.G.Nair the then District Commercial in-charge, on whose sworn statement, cognizance was taken on the 15 complaint cases for the offence under the provisions of the Act and later changed the authorisation to the then District Commercial in-charge Mr. Krishna Rao P.W.1).
2. The case of the complainant in all these cases was that for the supply of the products, like Tyres, Tubes, etc., through its Branch Office at Hyderabad, for the orders placed by the accused, being their dealers, from time to time under the respective invoices, for the amounts covered thereunder for each of the invoices, the accused issued the respective cheques, total 43 in number, during the period between 29.4.2000 and 23.5.2000, for a total amount of Rs.12,09,111/-, when presented for collection returned dishonoured and for the statutory notice of demand intimating the dishonour and to pay, the accused issued a reply with false averments saying no liability and failed to pay, hence the respective complaints. It is pursuant to said complaints and from the sworn statement of the complainants authorised District Incharge by then, by name Mr. K.G.Nair, cognizance was taken on the 15 complaint cases for the offence under the provisions of the Act and after the accused were summoned and put in appearance from supply of copies under Section 207 of the Code of Criminal Procedure (for brevity, The Cr.P.C.), when questioned on substance of accusation under Section 251 Cr.P.C., they pleaded not guilty and were put to trial and in the course of trial, the complainants authorised employee viz., the then District Commercial in-charge Mr. Krishna Rao was examined as P.W.1 and placed reliance upon the respective authorisation, Certificate of Incorporation of the company, the respective invoices for the supply of stocks as ordered by the accused and the cheques issued pursuant to it and on presentation of the cheques returned dishonoured as per the respective Memos and the statutory Notice issued with acknowledgement and certificate of posting in proof of service and the reply of the accused and also the statement of account of the accused with the complainant of the relevant period. In most of the cases, besides Exs.P.1 and P.2, authorisation and Certificate of Incorporation of the company, respectively, are common, other exhibits are depending upon the number of cheques for invoices and dishonour Memos i.e., where there is a single cheque for single invoice with dishonour Memo, exhibited as Exs.P.3 to P.5, respectively, and if there are 3 cheques for 3 invoices with 3 dishonoured Memos, exhibited as Exs.P.3 to P.11, respectively, and therefrom the other 5 documents with continuation number for the notice with acknowledgement and certificate of posting as well as reply and account copy, either as Exs.P.6 to P.10 or as Exs.P.12 to P.16, respectively. It is after said evidence of complainant, the accused were examined under Section 313 Cr.P.C. by bringing to their notice the incriminating material against them and from recording their answers in pleading innocence, reiterating their defence version of nothing due to pay to honour the cheques and thereby they issued to their banker instructions for stop payment and for return of the cheques, therefrom they committed no offence. Same is also the version in their reply notice as well in cross-examination of P.W.1, while admitting the orders placed by them for supply of stocks and received the stocks as per respective invoices and issued cheques for each of the respective invoice amount due on the respective dates, however, in saying they requested for settlement of account between them and for non-settlement, they also filed civil suit against the complainant showing amount due for recovery and thereby the amounts covered by the cheques not fallen due. They adduced evidence by cause examined the Law Officer of Charminar Cooperative Bank and exhibited through him Exs.D.1 to D.5 viz., List of Credit notes issued by the complainant, ledger extract of the O.D. Account bearing No.15, standing in the name of H.M. Tyres (A.1), 3 cheques dated 12.3.1999, 27.3.1999 and 31.3.1999 issued by accused from their account in favour of the complainant, stated encashed. It is also the defence that the amounts covered by 3 cheques Exs.D.3 to D.5 of March, 1999 encashed as per the evidence of D.W.1 with reference to Exs.D.1 and D.2 were not given credit to and thereby not reflected in Ex.P.16 ledger extract, and therefrom also for nothing due, no offence committed.
3. It is after hearing both sides, from said evidence on record, on even date, the trial Court by separate judgments from separate evidence recorded based on respective the cheques and invoices, though in all other respects, the complainants case and defence is common with common defence witness and documents; disposed of the matters acquitting the accused in all the cases.
4. The findings of the learned trial Magistrate in acquitting the accused were that as set out in the defence, the accused rebutted the presumptions available against them and in favour of the complainant under Section 118 and 139 of the Act, from admittedly purchased the stocks as per the orders under the respective invoices for which the cheques were issued, however, from showing the amounts covered by 3 cheques issued by the accused in favour of the complainant for its discharge under Exs.D.3 to D.5, since encashed, as reflected from the evidence of D.W.1 with reference to Exs.D.1 and D.2 and thereby shows nothing due under the cheques dishonoured and the stop payment issued is for not payable and committed thereunder no offence.
5. It is impugning said judgments, the present appeals are filed with the contentions common in the grounds of appeal as well as the submissions by the learned counsel for appellant/complainant in the course of hearing that the acquittal judgments of the trial Court are contrary to law, weight of evidence and probabilities of the case, instead of convicting the accused for the offence made out against them for dishonour of the cheques issued for the legally enforceable debt, not proved discharged and the trial Court failed to appreciate the factum of the amount of Rs.2,20,034/- of Exs.D.3 to D.5, 3 cheques of March, 1999 were relating to the period before 1.4.1999, whereas Ex.P.16 account is for the period commencing from 1.4.1999 to 28.2.2001, with opening balance as on 1.4.2000 of Rs.25,24,532/- and nothing more could be established by the accused of how the amounts covered by the cheques admittedly issued for the respective invoices on the respective dates for the respective legally enforceable debt of the stocks purchased, discharged, for the burden lies on them so to prove and not by merely disputing the debt and the trial Court also went wrong in saying as if there is no authorisation to P.W.1 or the earlier District Commercial Incharge K.G. Nair, even there was authorisation that was filed and that was also reflected in the judgment from the material on record and the trial Court also failed to appreciate the factum of the account of accused with complainant, how not genuine was supposed to be proved by the accused, if at all any amounts paid not reflected relating to the cheques and thereby sought for setting aside the acquittal judgments and allow the appeals by convicting the accused for the offence alleged in the respective cases and to punish respectively according to law.
6. On the other hand, it is the contention of the learned counsel appearing for respondents/accused, common in all the appeals in support of the defence raised before the trial Court, that the trial Court in support of the conclusion for acquittal given reasons for no offence made out for nothing due under the cheques even admittedly issued for the respective trade purchases for no balance due under the account and the amounts paid not given credit to and thus, there are no merits in the appeals to interfere with the trial Courts acquittal judgments, while sitting in appeals, and hence to dismiss the appeals.
7. Heard and perused the material on record.
8. Before formulating the points that arise for consideration, common in all the appeals and to answer, for more clarity, it is apt to refer the description of evidence on record, though there is a mistake in mention of the dates of cheques in the trial Court and corrections in the array of evidence among Exs.P.1 to P.16, for the reasons supra, depending upon the number of cheques and invoices, needless to reflect correspondingly to make the matter bulky, but for from perusal of the record correctly, case-wise, viz., (a) C.C.No.56 of 2001 (Crl.A.No.1590 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044529, dt.23.05.2000 P.3 IA000766, dt.23.5.2000 P.11 40,220-00 Ex.P.4 02. 044530, dt.23.05.2000 P.5 IA000769, dt.23.5.2000 P.9 40,220-00 Ex.P.6 03. 044522, dt.23.05.2000 P.7 IA000759, dt.23.5.2000 P.10 20,110-00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (b) C.C.No.57 of 2001 (Crl.A.No.1591 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044526, dt.23.05.2000 P.3 IA000763, dt.23.5.2000 P.9 40,220-00 Ex.P.4 02. 044527, dt.23.05.2000 P.5 IA000764, dt.23.5.2000 P.10 40,220-00 Ex.P.6 03. 044528, dt.23.05.2000 P.7 IA000765, dt.23.5.2000 P.11 40,220-00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (c) C.C.No.54 of 2001 (Crl.A.No.1592 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044520, dt.11.05.2000 P.3 IA000589, dt.23.5.2000 P.9 20,110-00 Ex.P.4 02. 044531, dt.12.05.2000 P.5 IA000599, dt.23.5.2000 P.10 18,784-00 Ex.P.6 03. 044533, dt.13.05.2000 P.7 IA000609, dt.23.5.2000 P.11 16,775 -00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (d) C.C.No.60 of 2001 (Crl.A.No.1594 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044770, dt.23.05.2000 P.2 IA000777, dt.23.5.2000 P.4 40,220-00 Ex.P.3 Ex.P.1 is the authorisation of P.W.1 Krishna Rao, Ex.P.5 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.6 and P.7 and reply of the accused Ex.P.8 and the statement of account of the accused Ex.P.9. (e) C.C.No.59 of 2001 (Crl.A.No.1595 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044761, dt.23.05.2000 P.3 IA000768, dt.23.5.2000 P.9 40,220-00 Ex.P.4 02. 044762, dt.23.05.2000 P.5 IA000769, dt.23.5.2000 P.10 40,220-00 Ex.P.6 03. 044763, dt.23.05.2000 P.7 IA000770, dt.23.5.2000 P.11 40,220-00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (f) C.C.No.52 of 2001 (Crl.A.No.1596 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044509, dt.09.05.2000 P.3 IA000562, dt.09.5.2000 P.9 20,110-00 Ex.P.4 02. 044510, dt.09.05.2000 P.5 IA000563, dt.09.5.2000 P.10 20,110-00 Ex.P.6 03. 044515, dt.09.05.2000 P.7 IA000564, dt.09.5.2000 P.11 20,110-00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (g) C.C.No.61 of 2001 (Crl.A.No.1597 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044506, dt.06.05.2000 P.3 IA000487, dt.06.5.2000 P.9 20,110-00 Ex.P.4 02. 044507, dt.09.05.2000 P.5 IA000560, dt.09.5.2000 P.10 10,055-00 Ex.P.6 03. 044508, dt.09.05.2000 P.7 IA000561, dt.09.5.2000 P.11 18,784 -00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (h) C.C.No.62 of 2001 (Crl.A.No.1598 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044276, dt.02.05.2000 P.3 IA000401, dt.29.4.2000 P.9 18,784-00 Ex.P.4 02. 044278, dt.03.05.2000 P.5 IA000417, dt.03.5.2000 P.10 17,613-00 Ex.P.6 03. 044502, dt.04.05.2000 P.7 IA000438, dt.04.5.2000 P.11 9,392 -00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (i) C.C.No.65 of 2001 (Crl.A.No.1599 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044521, dt.20.05.2000 P.3 IA000723, dt.20.5.2000 P.9 15,215-00 Ex.P.4 02. 044538, dt.17.05.2000 P.5 IA000656, dt.17.5.2000 P.10 29,502-00 Ex.P.6 03. 044539, dt.19.05.2000 P.7 IA000697, dt.19.5.2000 P.11 8,487-00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (j) C.C.No.63 of 2001 (Crl.A.No.1600 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044767, dt.23.05.2000 P.3 IA000774, dt.23.5.2000 P.9 40,220-00 Ex.P.4 02. 044768, dt.23.05.2000 P.5 IA000775, dt.23.5.2000 P.10 40,220-00 Ex.P.6 03. 044769, dt.23.05.2000 P.7 IA000776, dt.23.5.2000 P.11 40,220-00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (k) C.C.No.58 of 2001 (Crl.A.No.1601 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044764, dt.23.05.2000 P.3 IA000771, dt.23.5.2000 P.9 40,220-00 Ex.P.4 02. 044765, dt.23.05.2000 P.5 IA000772, dt.23.5.2000 P.10 40,220-00 Ex.P.6 03. 044766, dt.23.05.2000 P.7 IA000773, dt.23.5.2000 P.11 40,220-00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (l) C.C.No.55 of 2001 (Crl.A.No.1602 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044503, dt.05.05.2000 P.3 IA000456, dt.05.5.2000 P.9 20,110 -00 Ex.P.4 02. 044504, dt.05.05.2000 P.5 IA000457, dt.05.5.2000 P.10 20,110 -00 Ex.P.6 03. 044505, dt.06.05.2000 P.7 IA000496, dt.06.5.2000 P.11 40,220-00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (m) C.C.No.64 of 2001 (Crl.A.No.1652 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044523, dt.23.05.2000 P.3 IA000760, dt.23.5.2000 P.9 40,220-00 Ex.P.4 02. 044524, dt.23.05.2000 P.5 IA000761, dt.23.5.2000 P.10 40,220-00 Ex.P.6 03. 044525, dt.23.05.2000 P.7 IA000762, dt.23.5.2000 P.11 40,220-00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (n) C.C.No.51 of 2001 (Crl.A.No.1653 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044517, dt.11.05.2000 P.3 IA000586, dt.11.5.2000 P.9 20,110 -00 Ex.P.4 02. 044518, dt.11.05.2000 P.5 IA000587, dt.11.5.2000 P.10 20,110-00 Ex.P.6 03. 044519, dt.11.05.2000 P.7 IA000588, dt.11.5.2000 P.11 20,110-00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.12 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.13 and P.14 and reply of the accused Ex.P.15 and the statement of account of the accused Ex.P.16. (o) C.C.No.53 of 2001 (Crl.A.No.1654 of 2005) : Sl.No.Cheque No./ Date / Exhibit Invoice No./ Date / Exhibit Amount Rs. Dishonour Memo 01. 044280, dt.03.05.2000 P.3 IA000419, dt.03.5.2000 P.9 20,110-00 Ex.P.4 02. 044501, dt.03.05.2000 P.5 IA000420, dt.03.5.2000 P.10 20,110-00 Ex.P.6 03. 044279, dt.03.05.2000 P.7 -- -- 20,110-00 Ex.P.8 Ex.P.1 is the complainant companys Certificate of Incorporation, Ex.P.2 is the authorisation of P.W.1 Krishna Rao, Ex.P.11 is the Office copy of legal notice within statutory period with acknowledgement and certificate of posting Exs.P.12 and P.13 and reply of the accused Ex.P.14 and the statement of account of the accused Ex.P.15.
9. Now the points that arise for consideration are: (1) Whether the accused did not prove any discharge of the cheques issued, that were presented dishonoured from stop payment followed by the statutory notice with a demand to discharge of the amounts covered by the respective 43 cheques admittedly issued in favour of the complainant against the trade purchases covered by respective invoices of respective dates for discharge of said legally enforceable debt to make liable for the offence under Section 138 of the N.I. Act and if so, the trial Courts acquittal judgements are unsustainable and require interference by this Court, while sitting in appeals, in re-appreciation of the evidence on record with reference to the facts and as per law?. (2) To what result?. In re. Point No.1:
10. (A). Before adverting to the merits of the matter, it is beneficial to quote; the provisions incorporated in Chapter XVII of the N.I. Act make a civil transaction to be an offence by fiction of law and with certain (rebuttable) presumptions that shall be drawn. Sections 138 to 142 are incorporated in the N.I. Act,1881 as Chapter XVII by the Banking Public Financial Institutions and Negotiable instruments Laws (Amendment) Act,1981 (66 of 1988) which came into force w.e.f., 01.04.1989 and the N.I. Act was further amended by Act, 2002 (55 of 2002) which came into force w.e.f., 06-02-2003 incorporating new Sections 143 to 147 in this Chapter XVII and further some of the existing provisions not only of the Chapter XVII, but also of other Chapters amended to overcome the defects and drawbacks in dealing with the matters relating to dishonour of cheques. 10-(B). The object and intention of these penal provisions of Chapter XVII (Sections 138147), in particular, Sections 138 & 139 (besides civil remedy) are to prevent issuing of cheques in a playful manner or with dishonest intention or with no mind to honour or without sufficient funds in the account maintained by the drawer in Bank and induce the Payee/Holder or Holder in due course to act upon it. The remedy available in a Civil Court is a long drawn matter and an unscrupulous drawer normally takes various pleas to defeat the genuine claim of the payee. Since a cheque that is dishonoured may cause uncountable loss, injury or inconvenience to the Payee due to the latters unexpected disappointment, these provisions incorporated are in order to provide a speedy remedy to avoid inconvenience and injury to the Payee and further to encourage the culture of use of cheques and enhancing credibility of the instruments as a trustworthy substitute for cash payment and to inculcate faith in the efficacy of Banking operations - GOA PLAST (PVT.) LTD. v. CHICO URSULA DSOUZA . 10-(C). To fulfill the objective, the Legislature while amending the Act has made the following procedure: In the opening words of the Section 138 it is stated: ".Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid,---------, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act (See Sec.143), be punished ----. Provided, nothing contained in this section shall apply unless,-(a), (b); and (c) Explanation---(supra).". ".(i) Under Section 138 a deeming offence is created by fiction of law. (ii) An explanation is provided to Section 138 to define the words ".debt or other liability". to mean a legally enforceable debt or other liability.". (iii) In Section 139, a presumption is ingrained that the holder of the cheque received it in discharge of debt or other liability. (iv) Disallowing a defence in Section 140 that drawer has no reason to believe that cheque would be dishonoured. (v) As per Section 146(new section) the production of the Banks slip or Memo with official mark denoting that the cheque has been dishonoured is prima facie evidence for the Court to presume the fact of dishonour of such cheque unless such fact is disproved by the accused. 10-(D). Further the provision for issuing notice within fifteen days (amended as thirty days by the amended Act 55 of 2002, w.e.f., 06.02.2003) under section 138 after dishonour is to afford an opportunity to the Drawer of the cheque to rectify his mistakes or negligence or in action and to pay the amount within fifteen days of receipt of notice, failing which the drawer is liable for prosecution and penal consequences. 10-(E). Reasonability of cause for non-payment is not at all a deciding factor. Mens rea is irrelevant. It is a strict liability incorporated in public interest. 10-(F). Availability of alternative remedy is no bar to the prosecution 10-(G). In the words - where any cheque, the word any suggests that for whatever reason if a cheque is drawn on an account maintained by him with a Banker in favour of another person for the discharge of any debt or other liability, the liability cannot be avoided in the event of the cheque stands returned by the Banker unpaid. 10-(H). In Suman Sethi v. Ajay K. Churiwal and Another , it was held of the legislative intent as is evident from Section 138 of the Act that, if for the dishonoured cheque demand is not met within 15 days of receipt of the notice, the drawer is liable for conviction. If the cheque amount is paid within the above period or before the complaint is filed, the legal liability under Section 138 of the Act ceases to be operative and for recovery of the other demands, such as compensation, costs, interest etc., separate proceedings would lie. If, in a notice, any other sum is indicated in addition to the amount covered by the cheque, that does not invalidate the notice. 11-A. In K.N.Beena Vs. Muniyappan & Another at paragraph 7, it was observed that -- in this case, admittedly the accused has led no evidence except some formal evidence. The High Court appears to have proceeded on the basis that the denial of averments in his reply dated 21.5.1993 were sufficient to shift the burden on to the complainant to prove that the cheque was issued for a debt or liability. This is entirely an erroneous approach. The accused had to prove in the trial, by leading cogent evidence, that there was no debt or liability. The accused, having led no evidence, could not be said to have discharged the burden of proving that the cheque was not issued for a debt or liability. 11-AA. No doubt, this approach of the accused has to lead cogent evidence during trial in rebutting the presumptions and in proof of his defence, is explained by Apex Court in Narayan Menon V. State of Kerala as follows:
11. B. The Apex Court in NARAYAN MENON (supra) held that once the complainant shown that the cheque was drawn by the accused on the account maintained by him with a banker for payment of any amount in favour of the complainant from out of that account for its discharge and the same when presented returned by the Bank unpaid for insufficiency of funds or exceeds arrangement, such person shall be deemed to have been committed an offence under Section 138 of N.I. Act. What Section 139 of the Act speaks of the presumption against the accused to rebut is the holder of a cheque received the cheque of the nature referred in Section 138 of the Act for discharge of debt. For rebutting such presumption, what is needed is to raise a probable defence. Even for the said purpose, the evidence adduced on behalf of the complainant could be relied upon. Accused need not enter into the witness box and examine other witnesses in support of his defence. Accused need not disprove the prosecution case in its entirety. Therefore, the rebuttal does not have to be conclusively established, but such evidence must be adduced before the Court in support of the defence that the Court must, either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the ".prudent man".. 11-C. There are presumptions (besides the general presumptions under the Indian Evidence Act) specially provided in respect of a negotiable instrument under clauses (a) to (g) of Section 118 of the Act and, for the dishonour of cheque relating to criminal liability under Section 139 and apparently a legal fiction though strictly not as per the Explanation to Section 138-of the Act, for the purpose of this section, debt or other liability means a legally enforceable debt or other liability. Section 118: Presumptions as to negotiable instruments - Until the contrary is proved, the following presumptions shall be made: Clause (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. (b) to (g)----". Section 139: Presumption in favour of 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. Presumptions both under Sections 118(a) and 139 of the Act are rebuttable in nature. What would be the effect of the expressions May Presume, Shall Presume and Conclusive Proof has been considered by the Apex Court in Union of India (UOI) v. Pramod Gupta (D) by L.Rs. and Ors. , in the following terms: It is true that the legislature used two different phraseologies ".shall be presumed". and ".may be presumed". in ------ but the same would not mean that the words ".shall presume". would be conclusive. The meaning of the expressions ".may presume". and ".shall presume". has been explained in Section 4 of the Evidence Act,1872 from a perusal whereof it would be evident that whenever it is directed that the Court shall presume a fact, it shall regard such fact as proved, unless disproved. In terms of the said provision, thus, the expression ".shall presume". cannot be held to be synonymous with ".conclusive proof. In terms of Section 4 of the Evidence Act, whenever it is provided by the Act that the Court shall presume a fact, it shall regard such fact as proved unless and until it is disproved. The Apex Court in the later expression in KUMAR EXPORTS PVT. LTD. V. SHARMA CARPETS held in this regard that - presumptions that applied among clauses (a) to (g) of Section 118 also, like the presumption under Section 139 of the Act, as per Section 4 of the Evidence Act, are the rebuttable presumptions, for which the burden is on the accused. However, to rebut the presumptions, if a case is made out by accused, either by pointing out from the case of the complainant including very documents and cross-examination or by examining any person and need not be always by coming to witness box (as laid down in NARAYAN MENON (supra) and Krishna Janardhan Bhat v. Dattatraya G. Hegde . 11-D. Further, as per the expression of the Apex Court in RANGAPPA vs. MOHAN (3-Judges Bench) paras-9 to 15 referring to GOA PLASTS (supra), KRISHNA JANARDHAN BHAT (supra) by distinguishing at para-14 saying the observation in KRISHNA JANARDHAN BHAT (supra) of the presumption mandated by Section 139 does not, indeed, include the existence of a legally enforceable debt or liability, is not correct, though, in other respects, correctness of the decision does not in any way cause doubted; by also referring to Hiten P. Dalal v. Bratindranath Banerjee holding at paras-22 and 23 therein of the obligation on the part of the Court to raise the presumption under 138, 139 and 118 of the N.I. Act, in every case where the factual basis for raising the presumption has been established since introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused, as a presumption of law distinguished from a presumption of fact as part of rules of evidence and no way in conflict with the presumption of innocence and the proof by prosecution against the accused beyond reasonable doubt, but for saying to rebut the accused can discharge the burden showing reasonable probability of non-existence of the presumption of fact and to that proposition, the earlier expression in Bharat Barrel & Drum Manufacturing Company v. Amin Chand Pyarelal para-12 showing the burden on the accused is to bring on record by preponderance of probability, either direct evidence or by referring to circumstances upon which he relies, rather than a bare denial of passing of the consideration; apparently that does not appear to be of any defence to get the benefit in discharge of the onus against, also held referring the M.M.T.C. Ltd. and another v. Medchl Chemicals & Pharma (P) LTD that where the accused able to show justification of stop payment letter even from funds are there, but no existence of debt or liability at the time of presentation of cheque for encashment, to say no offence under Section 138 of the N.I. Act made out in discharge of the burden. It was concluded referring to the above, including of Mallavarapu Kasivisweswara Rao v. Thadikonda Ramulu Firm & Ors paras-14 and 15 that the initial presumption lays in favour of the complainant and Section 139 is an example of a reverse onus clause, which has been included in furtherance of the legitimate objection of improving the credibility of the negotiable instruments. While Section 138 specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. 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 and the test of proportionality should guide the construction and interpretation of reverse onus clause and the accused cannot be expected to discharge an unduly high standard or proof and in the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden to discharge by preponderance of probabilities by raising creation of doubt about the existence of a legally enforceable debt or liability to fail the prosecution and for that the accused can rely on the material submitted by the complainant also in order to raise such a defence and he may not need to adduce any evidence of his own. 11-DD. It was also observed in para-15 that the accused appear to be aware of the fact that the cheque was with the complainant, further-more the very fact that the accused has failed to reply to the statutory notice under Section 138 of the Act leads to an inference that there was merit in the complainants version. It was also held by this Court way back in Chapala Hanumaiah Vs. Kavuri Venkateshwarlu that having received and acknowledged the statutory legal notice after dishonour of cheque, non-giving of reply to said legal notice, improbablises the defence version, as any prudent person under the said circumstances should have, but for no defence to reply. 11-E. If at all, there is any payment including part payment or adjustment to be considered for deduction while enforcing the amount covered by the dishonoured cheque for its consequences, the burden is on the accused as per settled law to prove said discharge or adjustment. In this regard, in M/s. Thekkan and Company vs. M. Anitha , it was held by Kerala High Court that nothing precludes the Court under Section 138 of the Act for taking into account prior payments made before presentation of the cheque or before receipt of notice in deciding whether the amount due under the cheque has been fully paid, if not for continuing the prosecution. In another expression of same High Court in R. Gopikuttan Pillai vs. Sankara Narayanan Nair also it was held that accused is bound to prove payment of entire amount within 15 days of receipt of notice and any part payment made before or after notice cannot absolve liability from the criminal prosecution under Section 138 of N.I. Act and thereby the trial Court went wrong in acquitting the accused for part payment made and not of the entire due under the cheque. 11-F. Coming to the liability of the legal entity as accused, besides the entity, the persons responsible for its day-today affairs, even personally concerned, Section 141 of the Act is an instance of specific provision that in case an offence under Section 138 of the Act is committed by a company, the criminal liability for dishonour of a cheque will extend to the officers of the company. As a matter of fact, Section 141 contains conditions which have to be satisfied before the liability can be extended. Inasmuch as, the provision creates a criminal liability, the conditions have to be strictly complied with. In other words, the persons who had nothing to do with the matter, need not be roped in. An entity being a juristic person, all its deeds and functions are the result of acts of others. Therefore, the officers of the company, who are responsible for the acts done in its name, are sought to be made personally liable for the acts which result in criminal action being taken against the entity. In other words, it makes every person, who, at the time of commission of offence, was in-charge of and responsible for the conduct of business of the entity, as well as the entity, liable for the offence. 11-G. It is true that the proviso to sub-section enables certain persons to prove that the offence was committed without their knowledge or that they had exercised all due diligence to prevent commission of the offence. The liability under Section 141 of the N.I. Act is sought to be fastened vicariously on a person connected with the company, the principal accused being the company itself. It is a departure from the rule in criminal law against vicarious liability. 11-H. In this regard, in S.M.S. Pharmaceuticals Ltd. Vs. Neeta Bhalla (by Y.K.Sabharwal.J; Arun Kumar.J & B.N.Srikrishna.J3Judges Bench) held in answering to the questions posed in the Reference as under: (a) It is necessary to specifically aver in a complaint under Section 141 that at the time the offence was committed, the person accused was in charge of, and responsible for the conduct of business of the company. This averment is an essential requirement of Section 141 and has to be made in a complaint. Without this averment being made in a complaint, the requirements of Section 141 cannot be said to be satisfied. (b) The answer to question posed in sub-para (b) has to be in negative. Merely being a director of a company is not sufficient to make the person liable under Section 141 of the Act. A director in a company cannot be deemed to be in charge of and responsible to the company for conduct of its business. The requirement of Section 141 is that the person sought to be made liable should be in charge of and responsible for the conduct of the business of the company at the relevant time. This has to be averred as a fact as there is no deemed liability of a director in such cases. (c) The answer to question (c) has to be in affirmative. The question notes that the Managing Director or Joint Managing Director would be admittedly in charge of the company and responsible to the company for conduct of its business. When that is so, holders of such positions in a company become liable under Section 141 of the Act. By virtue of the office, they hold as Managing Director or Joint Managing Director, these persons are in charge of and responsible for the conduct of business of the company. Therefore, they get covered under Section 141. So far as signatory of a cheque which is dishonoured is concerned, he is clearly responsible for the incriminating act and will be covered under sub-section (2) of Section 141. The Reference has been answered.
12. From the above legal position, coming to decide on the facts of the cases on hand detailed supra, from oral, circumstantial and documentary evidence on record, as to how far it has disproved the case of the complainant and how far the presumptions in favour of the complainant as per the reverse onus clause with burden on accused to rebut, that could be rebutted by the accused and how far the plea of non-liability from any discharge or adjustment of accounts that could be proved by the accused in support of their plea concerned:
12. A. The 1st accused entity is represented by Accused Nos.2 and 3, in charge of its day-today affairs and management in dealing with the transactions, in particular with the complainants company, for the purchases made as per the orders placed covered by the invoices of stocks received for the amounts and for respective amounts issued respective cheques in discharge of the amounts covered by purchase invoices, total 43 in number, covered by 15 cases, exhibited as detailed supra, is not in dispute. The orders placed by them for supply of stocks and the invoices acknowledged and cheques issued also not in dispute. Thus, the accused are liable under Section 141 of the Act, subject to other merits of the case. 12-B. Coming to the liability of the accused for the cheques admittedly issued dishonoured as to how far they discharged their burden of any payment or adjustment, including in rebutting the presumptions under reverse onus clause against them, is concerned, it is also brought in the cross-examination of P.W.1 by the accused in support of the complainants case as also reflected in paras-14 and 15 of the respective judgments by the trial Court of the fact that the complainant used to receive the amounts through the cheques towards the corresponding invoices after adjusting the credit notes and the cheques used to be received towards particular invoices issued for the supply of material to the accused and the cheques (43 in number in 15 cases) were issued towards said particular invoices. Thus, it is for the accused, who, as per the orders, received the stocks pursuant to the invoices for the amounts covered thereunder, issued the cheques and nothing more is required to say from the very say of the accused also of the cheques issued were for the legally enforceable debts of the amount covered by the respective purchase invoices. It is then for the accused to prove any discharge of the respective cheque amounts or otherwise adjustment, as the burden lies on them to avoid the legal consequences of the cheques presented, admittedly dishonoured from the stop payment instructions issued by the accused to their banker. There is nothing from the cross-examination of P.W.1 by accused in disputing the correctness of the copy of the account of the 1st accused entity with the complainant (marked as Ex.P.16 in most of the cases) for the amounts due, but for the say, if at all any payment or adjustment not further reflected. The account copy reflects commencement of transactions from the opening balance (brought forward of the previous year) of Rs.25,24,532/- and the transactions commenced by payments through cheques from 4.4.2000 and the invoices under which the stocks supplied and the invoices for 43 cheques are reflected in the said account, including those of 23.5.2000 and the amounts covered by 43 cheques presented dishonoured were for such dishonour shown as due by debiting against the credit given on the cheques received to the account of the 1st Accused entity therein. The account copy shows the transactions till 28.2.2001 of the balance covered by the cheques (43 in number) and for other amounts to a total of Rs.16,00,503/-, of which said 43 cheques reflect the amount for Rs.12,09,111/-. Same is also reflected in the statutory notice (marked in most of the cases as Ex.P.12) issued within 15 days after receipt of the cheque return Memos for stop payment by intimating dishonour of the cheques and demanding to pay said amount, else for legal recourse under Section 138 of N.I. Act. The notice was also addressed to Accused Nos.1 to 3 to their addresses reflected in the complaints by registered post and by certificate of posting and there is nothing illegality in issue of said notices, even it is the consolidated notice sent in the name of three accused and for which the reply was admittedly cause issued by them (marked in most of the cases as Ex.P.15) with averments therein showing that they are the dealers for the past more than 8 years in marketing the products of the complainant with all cooperation and were also receiving incentives and other facilities and even accepting post- dated cheques from them and for the goods sold by accused to the customers and amounts received, they were crediting the amounts to their account and the complainant was encashing the cheques from intimation. A lot of correspondence took place between them and particularly letter dated 11.7.2000 of the accused to provide necessary details for settlement of accounts, which is with no positive reply from the complainant and the cheques issued are subject to settlement of accounts, that could not be for non-providing of necessary details by the complainant which made the accused to issue stop payment instructions to their banker and not for lack of sufficient funds and thereby they are not liable for the amounts covered by the dishonoured 43 cheques of Rs.12,09,111/-, pending settlement of the account and, as such, they are not liable for any prosecution and penal consequences. The reply further reads that for the good business turned out by them, a Maruti Esteem Car of 1996 model, registered No.AP9 1869 was gifted to them by the complainant, however, deliberately withheld the documents of the car from which they could not ply the car on road. Page-3 of reply further discloses a statement of account by the accused that as on 31.7.1999 due Rs.46,73,000/-, whereas as per the letter dated 16.8.1999 of the complainant, as on 31.7.1999 due by accused Rs.52,00,000/- and after adjustment of first quarter credit notes, 1999 of Rs.7,78,000/-, payments through Pay Orders of Rs.21,86,000/- (17 + 4.86), 2nd quarter credit notes, 1999 of Rs.4,26,000/-, payments through various cheques upto 31.3.2000 of Rs.9,95,000/-, there was actually due Rs.2,88,000/- and as per complainants account Rs.8,15,000/- and of which, 3rd quarter credit notes, 1999 of Rs.6,67,000/- if deducted, the balance was Rs.1,48,000/- and the bill under COD account dated 3.8.1999 was Rs.1,69,000/- and the balance payable by the accused to the complainant therefrom was Rs.3,17,000/- and the billing of the year 2000 of Rs.11,20,000/- to be added to it, from which as per the complainant Rs.14,37,000/- due, whereas as per accused only Rs.9,10,000/- due, for the original variation of Rs.5,23,000/-. Even that is taken into consideration, from the very reply as on that date, the accused fallen due to the complainant out of 43 cheques amount of Rs.12,09,111/-, only Rs.9,10,000/-. It is not even deposited, much less paid by the accused of said amounts to the complainant for disputing regarding correctness of the account in respect of said original variation of Rs.5,23,000/-. 12-C. It is important to note that the accused did not produce any of its accounts copy, even in relation to the so called due as per their accounts, for such a disputing much less by confronting to P.W.1 or by exhibiting through any of their witness in defence. P.W.1, even in the cross-examination by accused, deposed that 15 cases filed pertain to 43 cheques for the total amount Rs.12,09,111/- as reflected in the statutory notice given for dishonour of cheques. He deposed that the accused, a reputed dealer, till the cheques are dishonoured, the accounts of the complainant are computerised accounts, including for RAS and COD, whenever deposit made by the dealer company supply the material i.e., RAS account and, if the material supplied is more than the value of the advance deposit made, the balance being shown in COD account, and the same being reflected in the invoices. The invoice will be generated even without any proof of any cheque being given for previous invoice. The present cases are for the cheques for the cost of stock supplied and the company used to issue credit notes as well as debit notes to the dealers of which, the amount mentioned in the credit notes being credited to their account and Ex.D.1 reflects the list of credit notes issued by the complainant to the accused with details of invoices to adjust. Invoice bearing No.IA903064 is reflected therein (dated 1.10.1999), but not reflected in the account copy (Ex.P.16) (In fact, Ex.P.16 is the account for the transactions from 1.4.2000 and not prior to that to reflect). It is further deposed that in the account copy Ex.P.16, the supply of stock for Rs.39,393/- under invoice No.IA904163 on 11.12.1999 shown and it was against the credit note issued to accused on 31.1.2000 as per Ex.D.1 (In fact, in Ex.D.1, it was not reflecting invoice No.IA904163 on 31.1.2000, but for on 11.12.1999 as reflected in Ex.P.16 to say no discrepancy). Leave about the further cross-examination, in an attempt to point out the so called discrepancy in the accounts, admittedly, the last transactions of purchase under invoices were on 23.5.2000. It is important to note that it was on that day also, as described above, some of the cheques for the purchase invoices were issued by the accused to say as on that date they could not say any discrepancy in issuing the cheques for the amounts covered by the invoices. Having so issued the cheques and could not prove anything of subsequent payment out of it, for the so called discrepancy in the accounts earlier, they cannot say that the cheques are not for the legally enforceable debt, having admittedly issued for the respective purchase invoices for the amounts covered thereunder. When such is the case, they have no right to issue stop payment instructions to their banker with no mind to honour the cheques, much less dispute legal enforceability of the amounts covered by the cheques, for not a case of subsequent discharge of any amounts thereunder. It is because the cheques relate to the period of only May, 2000, which are all for Rs.12,09,111/- covered by 43 cheques and even the invoices correspond to it are from 29.4.2000 to 23.5.2000 and not of any earlier period. Even coming to Exs.D.3 to D.5, P.W.1 was not specifically cross-examined, leave about said 3 cheques were of March, 1999 of the payment of Rs.11,630/- + Rs.26,813/- + Rs.18,359/- by accused to the complainant for earlier transactions to that date and not admittedly for the amounts covered by 43 cheques of May, 2000. Even for what is suggested to P.W.1 of the accused made payments in April and May, 2000 of Rs.20,12,260/-, there is no proof filed, even P.W.1 stated, he cannot say without verification of records, if any, in proof of it and denied the suggestion that the complainant is liable to pay Rs.4,00,778/- to the accused by 23.5.2000 with no liability by accused to the complainant. For that, there is nothing to show any discharge of the amounts covered by the purchase invoices relating to 43 cheques issued, respectively, much less any return of stocks out of it to adjust or any incentives out of it to adjust. In the absence of which, that too having elicited as discussed supra, of the cheques issued for the respective purchase invoices, any so called discrepancy or fallen due from settlement of account earlier, no way can be taken advantage by accused to dishonour the cheques or dispute the admittedly issued cheques for the admittedly received stocks covered by the purchase invoices as per the orders placed. However, the trial Court failed to appreciate the same. The trial Court, in fact, went wrong on the scope of the lis, instead saying by so concluding, of the remedy of the accused is to file a suit for settlement of accounts by showing any earlier adjustment and refund of amounts, admittedly when that no way relate to the transactions covered by the cheques. As pointed above, the accused even did not produce their accounts. They did not show any payment or discharge of even single cheque amount, out of 43 cheques, for claiming the so called non-liability of legally enforceable debt for the cheques issued, admittedly. Suffice to say that the accused could not discharge the burden of payment or adjustment out of the cheques issued for the amounts covered by the purchase invoices as per the orders placed and supplied to them by the complainant to say for the legally enforceable debt, respectively, and as such, they are liable for conviction and the trial Courts acquittal judgments are unsustainable to set aside by convicting the accused in the respective cases for the offence under Section 138 of N.I. Act. Accordingly, point No.1 is answered. In re. Point No.2:
13. In the result, all these Criminal Appeals are allowed setting aside the respective orders of acquittal recorded by the trial Court and the respondents/Accused Nos.1 to 3 are found guilty of the offence under Section 138 of the N.I. Act and are convicted accordingly.
14. For hearing of the accused on the quantum of sentence, posted to dt.06.06.2014, under the caption FOR APPEARANCE. 06.06.2014 :
15. Even posted the matter from 02.06.2014 by reversing the acquittal judgment of the trial Court finding the accused persons 1 to 3 guilty allowing the appeal to this day for hearing of the accused Nos.1 to 3 on sentence, the accused Nos.1 to 3 did not appear and thus taken that he has no say. The accused issued the respective cheques, total 43 in number, during the period between 29.04.2000 and 23.05.2000 for a total amount of Rs.12,09,111/-. It was held by the apex Court in SOMNATH SARKA VS. UTPAL BASU MALLICK that the Act not contemplated grant of compensation but envisages imposition of fine not exceeding twice the amount of dishonoured cheque and out of said fine amount, the complainant be compensated under Section 357 Cr.P.C. and that unlike for other forms of crime, the punishment here (insofar as the complainant is concerned) is not a means of seeking retribution, but is more a means to ensure payment of money. The complainants interest lies primarily in recovering the money rather than seeing the drawer of the cheque in jail. The threat of jail is only a mode to ensure recovery. As against the accused who is willing to undergo a jail term, there is little available as remedy for the holder of the cheque.
16. Having regard to the above and from the submission by the appellant/complainant of the endeavour is to recover the amount of compensation from out of fine or otherwise, rather than sentencing the accused Nos.1 to 3 to jail, the accused No.1 represented by Mr.Hameed Muzafaruddin, accused No.2 Mr.Hameed Muzafaruddin in personal capacity and accused No.3 Mr.Adil Moizuddin are sentenced to undergo Simple Imprisonment till rising of the day and to pay a fine of Rs.12,50,000/- and out of which an amount of Rs.12,10,000/- shall be paid to the complainant towards compensation and the remaining amount of Rs.10,000/- has to be paid towards fine to the State. It is thereby directed the learned Magistrate to secure the presence of accused persons 1 to 3 of warrant to undergo the sentence in that open Court and also to cause recover the fine amount under Section 431 read with Section 421 of Cr.P.C. by issuing warrant levying the fine with default sentence of three months Simple Imprisonment as per Sections 65 to 68 read with 53(6) I.P.C. _____________________________________ Dr. JUSTICE B. SIVA SANKARA RAO0606.2014.