Judgment:
Arali Nagaraj, J.
1. This appeal is by the complainant in Criminal Case No. 5384/2007 on the file of the learned III Additional Civil Judge (Jr.Dn.) and J.M.F.C., Udupi (hereinafter referred to as the 'Trial Court' for short). The appellant-complainant has challenged in this appeal the correctness of the judgment and order of acquittal dated 06.10.2008 passed In the said case acquitting the respondent-accused of the offence under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the 'NI Act' for short).
2. Stated in brief the case of the complainant (hereinafter parties are referred to as per their rank before the Trial Court) as alleged in his complaint filed under Section 200 of Cr.P.C. against the accused, is as under:
(a) The accused agreed to purchase two shop premises belonging to the complainant bearing D. No. 9-4-62E situate in the ground floor of the building known as 'Best-Co Complex' in Udupi town for a total consideration of Rs. 23,50,000/-. Accordingly, the complainant executed agreement of sale dated 15.05.2007. On that date of agreement, the accused paid to the complainant a sum of Rs. 3,00,500/- and issued on the same date a post dated cheque (dated 01.07.2007) in favour of the complainant drawn on Canara Bank, Udupi, for the balance consideration amount of Rs. 20,49,500/-. On 15.05.2007 itself, the accused also issued a letter in that regard.
(b) When the complainant presented the said cheque to the Bank for its encashment, it came to be returned with endorsement as 'funds insufficient and payment stopped by drawer'. Thereafter, the complainant issued statutory notice dated 07.07.2007 to the accused calling upon him to pay to the complainant the said amount of cheque within fifteen days from the date of receipt of the said notice. Despite receipt of the said notice on 12.07.2007, the accused did not make payment of the amount under the said cheque. Thus, the accused committed an offence under Section 138 of the NI Act.
(c) On 25.06.2007 i.e., earlier to the date of the said cheque, the accused issued a notice to the complainant making therein false and frivolous statements as to the execution of the said agreement of sale dated 15.05.2007 and as to issuance of the cheque in question. No force or coercion was exercised by the complainant against the accused in getting the said agreement of sale executed and the said cheque issued by the accused as alleged in the said notice. The accused reiterated the same in his subsequent reply notice dated 23.07.2007 issued by him to the complainant in response to the complainant's statutory notice dated 07.07.2007. All the allegations made in the said notices dated 25.06.2007 and 23.07.2007 issued by the accused to the complainant are false and imaginary. If there was any force or coercion, by the complainant, on the accused, as alleged therein, the accused should have taken action against the complainant immediately after the alleged coercion was removed or he would have filed Police complaint in that regard. The contentions of the accused in the said notices that there was no debt, much less legally enforceable debt, payable by him to the complainant and that the cheque in question was not issued by him towards discharge of any debt or towards payment of balance consideration amount, are totally untenable.
(d) The accused had voluntarily approached the complainant expressing his willingness to purchase the said shop rooms from the complainant and accordingly, the complainant entered into the agreement of sale with the accused, as aforesaid.
3. In order to substantiate his case against the accused, the complainant has got examined himself as P.W. 1 and one Rathna Kumar as P.W.2 and he has got marked for him the documents at Exs.P1 to P14. In support of his defence, the accused has got himself examined as D.W. 1 and he has got marked for him the documents at Exs.D1 to D3. On appreciation of the oral and documentary evidence placed on record by the respective parties, the Trial Court, by its impugned judgment and order of acquittal, acquitted the accused of the said offence.
4. Sri K.A. Ariga, the learned Counsel for the appellant-complainant strongly contended that the Trial Court committed serious error in observing at para 15 of its judgment that the complainant had failed to prove the fact that the cheque in question was issued by the accused for discharging the liability as alleged in Ex.P1 agreement. He further contended that the Trial Court committed further error in observing at para 16 of its judgment that Ex.P1 agreement is in dispute and the possession of the said properties has not been handed over to the accused and therefore, if at all the accused had failed to perform his part of the contract, the remedy that was left to the complainant was to take appropriate steps against the accused in a Civil Court and the matter involved between the parties could not be decided by the Criminal Court (Trial Court). He further contended that though the balance consideration of Rs. 20,49,500/-, agreed to be paid by the accused to the complainant in terms of Ex.P1 agreement could not be termed as 'debt', nevertheless, it could be termed as 'other liability' as found in Section 138 of the NI Act and since the cheque in question that was issued by the accused to the complainant was towards discharge of the said liability, the Trial Court committed illegality in acquitting the accused of the said offence.
5. Per contra, Sri K.M. Nataraj, the learned Counsel for the respondent-accused, while supporting the impugned judgment and order of acquittal, strongly contended that the very agreement at Ex.P1, based on which the complainant filed the said complaint, had been seriously disputed by the accused on the ground that the same was obtained by the complainant by threatening the accused and by exercising coercion on him and therefore, the said agreement was validly rescinded by the accused by issuing his notice dated 25.06.2007 i.e., prior to the date of the cheque in question, and therefore, the Trial Court has rightly observed in its judgment that 'no legally enforceable liability' was existing on the said date of the cheque. He further contended that the defence taken by the accused was that the said agreement was got executed by the complainant by putting him under threat and the said cheque was also obtained from him under coercion and therefore, the Trial Court, being a Criminal Court, could not give a finding on the issue 'whether the said agreement was executed by the accused voluntarily and with his free consent, as contended by the complainant, or whether it was got executed by the complainant by exercising coercion on the accused, as contended by the accused', and therefore, the Trial Court rightly observed that if the accused did not perform his part of the contract in terms of Ex.P1 agreement, the remedy available to the complainant was before a competent Civil Court but not before the Criminal Court. He further submitted that no error or illegality is committed by the Trial Court in acquitting the accused by its impugned judgment and order of acquittal and therefore, the present appeal deserves to be dismissed and the impugned judgment and order of acquittal deserves to be confirmed.
6. It is not in dispute that the alleged balance consideration amount of Rs. 20,49,500/- could not be termed as 'debt' within the meaning of Section 138 of the NI Act, It is the contention of the learned Counsel for the appellant-complainant that the said amount for which the cheque in question came to be issued could be held as 'other liability' within the meaning of Section 138 of the NI Act. If this contention is accepted, it has to be seen further whether the said liability could be legally enforceable by the complainant against the accused in terms of Ex.P1 agreement, as contended by the learned Counsel for the complainant, or, it could not be held to be legally enforceable by the complainant against the accused, as contended by the learned Counsel for the accused.
7. As could be seen from the recitals in Ex.Pl agreement, said to have been executed by the complainant in favour of the accused at the instance of the accused himself, as rightly observed by the Trial Court, it is described as 'agreement of re-conveyance' of the properties mentioned therein by the complainant in favour of the accused. It is stated in the said agreement that the two shop rooms were sold to the complainant by the accused under registered sale deed dated 17.02.2005 and thereafter, the accused requested the complainant to re-convey the same and therefore, the said agreement came into existence. Thus, it is clear that what is said to have been agreed between the parties in the said agreement is reconveyance of the properties mentioned therein by the complainant in favour of the accused, which the complainant had purchased from the accused during February 2005.
8. As could be seen further from the recitals in Ex.P1 agreement, the accused paid to the complainant a sum of Rs. 3,00,500/- as part of the consideration amount and he issued on dated 15.05.2007 post dated cheque i.e., the cheque dated 01.07.2007 in favour of the complainant towards the balance consideration amount of Rs. 20,49.500/-. It is further stated in Ex.P1 that the accused shall pay the balance consideration amount to the complainant on or before 01.07.2007 and the complainant shall execute and register re-conveyance deed in favour of the accused on or before 01.07.2007 and that in case of failure on the part of the accused to pay to the complainant the said balance consideration amount on or before 01.07.2007, the complainant would be entitled to recover from the accused, at his cost, the said balance consideration amount.
9. Thus, it is clear from the above recitals in Ex.P1 agreement, though its valid execution is disputed by the accused, that the properties in question were earlier sold by the accused to the complainant in the year 2005 and during the year 2007, the said properties were sought to be re-conveyed by the complainant in favour of the accused under the said agreement. It is further clear from the said recitals that ever since the accused sold the said properties to the complainant in the year 2005, the complainant had been in possession and enjoyment thereof and he did not deliver to the accused possession of any of the said two shop rooms pursuant to the said agreement. Thus, the title to the said property did not pass from complainant to the accused, though the complainant received a sum of Rs. 3,00,500/- in terms of the said agreement, which, of course, is not admitted by the accused. Further, it is not in dispute that by issuing the legal notice dated 25.06.2007, which is produced by the complainant himself as Ex.P2, the accused rescinded the said agreement (Ex.Pl) and informed the complainant in the said notice that he should not present the said cheque to the Bank for its encashment.
10. On a plain reading of the allegations in the said notice Ex.P2 made by the accused against the complainant, it is clear that he rescinded the said agreement (Ex.P1) on the ground that his signatures on it were obtained by the complainant by threatening him with dire consequences and under coercion. It is further alleged in the said notice Ex.P2 that the cheque in question was obtained by the complainant from the accused by exercising coercion on him. Therefore, it is clear that the very legality of Ex.P1, the agreement, and the factum of issuing of the cheque in question by the accused in favour of the complainant towards payment of balance consideration amount in terms of the said agreement (Ex.P1), had been seriously disputed by the accused. Having regard to these facts, as asserted by the complainant himself, the fact remains that in case he proves the said agreement, he would be entitled to receive the balance consideration amount from the accused only on execution and registration of the sale deed in favour of the accused, and not otherwise. Therefore, I am of the considered opinion that even if the payment of balance consideration amount under the said agreement by the accused to the complainant could be held as 'other liability' within the meaning of Section 138 of the NI Act, it could not be further held that the said liability was legally enforceable against the accused by the complainant as on 01.07.2007, the date of the cheque in question which is said to have been issued by the accused in favour of the complainant. Therefore, I do not find any illegality committed by the Trial Court in observing in its impugned judgment that no 'legally enforceable liability' existed as on the date of the said cheque.
11. Since the valid execution of Ex.P1 agreement and issue of cheque in question by the accused to the complainant in terms thereof, are seriously questioned, findings as to, 'whether the said agreement was entered into by the accused with the complainant with his free consent'; 'whether he issued the said clieque to the complainant voluntarily in terms of the recitals in the said agreement', as contended by the complainant, or, 'whether the signatures of the accused were obtained on the said agreement' and 'whether the said cheque was taken by the complainant from the accused by exercising coercion on him', are to be given. As rightly observed by the Trial Court, findings on these issues could not be given by it, being the Criminal Court, and the said findings on the said issues are to be given by a competent Civil Court. Therefore, I am of the considered opinion that the Trial Court is quite justified in observing at para 12 of its judgment that if at all any terms of the alleged agreement dated 15.05.2007 are violated by the accused, then the remedy is left elsewhere but not before it, which is a Criminal Court. It is further justified in observing at para 16 of its judgment that if at all the accused failed to perform his part of the said agreement, the remedy open to the complainant is to take appropriate steps against the accused before the competent Civil Court. I do not find any ground to interfere with these findings. Hence, I hold that the Trial Court is fully justified in dismissing the complaint of the complainant and thereby acquitting the accused of the said offence.
12. The learned Counsel for the appellant-complainant has relied upon the following decisions:
(i) Harbhajan Singh and Ors. v. State of U.P. and Anr. : 2005 Crl.L.J. 3029.
(ii) Modi Cements Limited v. Kuchil Kumar Nandi 1999 (1) KCCR 212.
(iii) M. Chandrashekar Rao v. V. Kutamba Rao and Anr. : 2006 Crl.L.J. 1399.
(iv) Moideen v. Johny 2006 Cri.L.J. 542 (Ker.)
(v) Goaplast Pvt. Ltd. v. Shri Chico Ursula D'souza and Anr. : 2003 Crl.L.J. 1723.
(vi) Hiten. P. Dalal v. Bratindranath Banerjee : 2001 Crl.L.J. 4647.
(vii) Greaves Limited v. Leo Electronics Organisation and Ors. 2007 Cri.L.J. 642 (A.P.)
(viii) Mandadi Ram Reddy v. State of A.P. and Anr. : 2003 Crl.L.J. 3647.
(ix) A.V. Murthy v. B.S. Nagabasavanna 2002 AIR SCW 694.
(x) I.C.D.S. Ltd. v. Beenma Shabeer and Anr. : AIR 2002 Supreme Court 3014.
(xi) Ramakrishnan v. Gangadharan Nair and Anr. AIR 2007 (NOC) 2033 (Ker.)
Likewise, the learned Counsel for the respondent-accused has also relied upon the following decisions:
(i) Swastik Coaters Pvt. Ltd. v. Deepak Brothers and Ors. : 1997 Crl.L.J. 1942.
(ii) Kumar Exports v. Sharma Carpets 2009 AIR SCW 1018.
(iii) Sudha Beevi v. State of Kerala and Anr. : 2004 Crl.L.J. 3418.
(iv) Q-Soft System and Solutions (P) Ltd. v. Sri H.N. Giridhar 2008(1) KCCR 75.
(v) Sathavahana Ispat Ltd. v. Umesh Sharma and Anr. ILR 2006 Kar 3579.
(vi) P. Venugopal v. Madan P. Sarathi 2008 AIR SCW 7702.
(vii) Krishna Janardhan Bhat v. Dattatraya G. Hegde : (2008) 4 Supreme Court Cases 54.
Suffice it to say that in view of my findings recorded supra on facts of the instant case that the Trial Court is quite justified in acquitting the accused, of the offence under Section 138 of the NI Act, I need not discuss hi detail the principles laid down in the said decisions.
13. In view of my foregoing discussions, I proceed to pass the following:
ORDER
The present appeal filed fey the complainant in Criminal Case No. 5384/2007 on the file of the learned III Additional Civil Judge (Jr.Dn.) & J.M.F.C., Udupi, is hereby dismissed. The impugned judgment and order of acquittal dated 06.10.2008 passed in the said case is hereby confirmed. No order as to costs in this appeal.