EdwIn Fernandes Vs. Bhavanidas Nagesh Parkar and Another - Court Judgment

Oral Judgment:

1. This appeal is directed against the judgment dated 8/07/2010 passed by the Judicial Magistrate First Class, Mapusa, thereby acquitting the respondent/original accused for the offence punishable under Section 138 of the Negotiable Instruments Act of 1881.

2. It is the case of the complainant that the respondent/original accused was his friend and he was in need of money due to illness of his mother. So he made a demand of Rs.1,75,000/- (Rupees one lac seventy five thousand only) for her hospitalisation approximately in the month of June, 2008. The complainant gave amount of Rs.1,00,000/- (Rupees one lac only) in June, 2008 by cash against which the respondent/original accused issued postdated cheque dated 12/07/2008 of Rs.1,00,000/- (Rupees one lac only), drawn on Madgaon Urban Co-operative Bank, Ponda Branch, in favour of the complainant. The said cheque was dishonoured for insufficient funds on 22/08/2008. The complainant, thereafter, issued statutory notice on 19/09/2008 calling upon the accused to make a payment of the said amount within 15 days. The said notice was received on 22/09/2008. However, no payment was made by the respondent/original accused. The complainant, therefore, presented the complaint before the learned Magistrate under Section 138 of the Negotiable Instruments Act. The learned Magistrate issued process and the respondent/original accused appeared before the Court. He pleaded not guilty, hence the evidence of both the parties was recorded by the learned Magistrate and the trial was concluded in acquittal of the accused. Hence, the present appeal.

3. The learned Counsel for the appellant/complainant has submitted that the learned Magistrate has given erroneous finding on the point of proof of the legally enforceable liability on the part of the accused. It was wrongly held that no such cheque was issued by the accused in favour of the complainant. He submitted that complainant has examined himself and so also Bank Manager PW2/Mr. Datta Madkaikar to prove the fact of issuance of the cheque, presentation of the cheque and dishonour of the cheque for want of insufficient funds. Learned Counsel further submitted that the evidence tendered by the accused to dislodge the case of the complainant ought not to have been accepted by the learned Magistrate. The learned Counsel read over the evidence of all the witnesses to assist the Court. He pointed out the falsities in the evidence of the accused-DW1 and Kishor Borkar, the DW2. The learned Counsel submitted that the defence adopted by the accused that respondent/original accused has given a blank cheque to Kishor Borkar to help him financially in his business of fast food and the said cheque was misplaced by Kishor Borkar and that is the same cheque which was presented by the complainant in the Bank; is a concocted story. Learned Counsel further submitted that evidence of DW2/Kishor Borkar ought not to have been believed by the learned Magistrate on the point of payment of the amount by the respondent/original accused and the loss of cheque by Kishor Borkar. He further submitted that the accused has denied the fact of service of statutory notice on him. However, DW2/Kishor Borkar has given admission that on receipt of the statutory notice of the demand of money, the accused had approached him and had asked for the return of the said cheque which was alleged to have been given to him by the accused. He further submitted that the finding given by the learned Magistrate that the complainant has failed to prove the transaction between him and the accused is not correct and the judgment of the Trial Court of acquitting accused is illegal and to be set aside. The learned Counsel further submits that no reply to the notice was given by the accused and therefore the evidence of DW2/Kishor Borkar ought not to have been accepted.

4. Per contra, the learned Counsel for the respondent/original accused submitted that the order passed by the learned Magistrate is to be maintained as the complainant could not establish the payment made by him to the respondent/original accused of Rs.1,00,000/- (Rupees one lac only). It was argued that complainant did not bring any evidence on the point of payment of Rs.1,00,000/- (Rupees one lac only). The conduct of the complainant is doubtful especially as he did not inquire the reason for the demand of alleged loan by the accused. It was argued that the complainant should have tendered evidence on the point of his financial capacity to pay the said amount. He did not lead any evidence to prove that he was earning Rs.6,000/- (Rupees six thousand only) to Rs.7,000/- (Rupees seven thousand only) per month and thereby he had sufficient funds to pay amount of Rs.1,00,000/- (Rupees one lac only) in cash to the respondent/original accused. Learned Counsel further submitted that in the cross-examination, the complainant has stated that the accused had given him an undertaking to return the money. However, no documentary evidence to that effect is produced. Learned Counsel further submits that the accused has successfully put up a defence through his evidence and also through evidence of DW2/Kishor Borkar that the blank cheque was handed over to DW2/Kishor Borkar, who misplaced the said cheque. The learned Counsel further submitted that DW2/Kishor Borkar has corroborated evidence of DW1, accused in all material aspects and it is rightly accepted by the learned Magistrate and the learned Magistrate acquitted the accused.

5. The original complainant has adduced his oral evidence on the point of payment of Rs.1,00,000/- (Rupees one lac only) to the accused. It is true that no documentary evidence in support of this payment is tendered by the complainant. He has deposed that the accused at the time of handing over the cash amount of Rs.1,00,000/- (Rupees one lac only) gave him an undertaking that he would return the said amount. Thus, undertaking can be oral and not necessarily documentary. Further, he deposed that respondent/original accused issued postdated cheque dated 12/07/2008 in his favour of the amount of Rs.1,00,000/- (Rupees one lac only). The complainant did not adduce any evidence on the point of his financial capacity to pay. However, Section 138 of the Negotiable Instruments Act itself does not demand that in each and every monetary transaction which is covered under Section 138, it is mandatory for the complainant to prove his financial capacity and also to lead specific evidence to show how and in what manner the funds were raised by him to make the payment to the accused. The evidence of the complainant on the point of payment is to be accepted and so also his financial capacity cannot be doubted as the amount paid is not huge. The payment of loan can be suspicious itself if at all the amount is too huge and any other such circumstance is brought on record. In the present case, the complainant has stated that he was working as a broker and he was drawing Rs.6,000/- (Rupees six thousand only) to Rs.7,000/- (Rupees seven thousand only) per month. The admissions are sought in the cross-examination that the complainant did not produce the passbook so also he did not disclose any other relevant documentary evidence to show that he was having that much money when the loan was given. However, this defence cannot sustain in the case tried under Section 138 of the Negotiable Instruments Act. If the credibility of the complainant is not destroyed in the cross-examination or by bringing some material on record to show that the complainant was really poor or financially undergoing such crisis or it was not at all possible for him to pay such amount then the evidence of the complainant is to be believed. In the present case, the complainant has stated on oath that he has presented the cheque dated 12/07/2008, Exhibit - 8 to the Bank which was dishonoured and therefore he gave statutory notice on 19/09/2008 which was received by the accused on 22/09/2008. As argued by the learned Counsel for the appellant that the stand taken by the accused in respect of the receipt of notice is false, is correct. DW2/Kishor Borkar, in his evidence has stated that only after receipt of the statutory notice, the accused had approached him and had asked about the cheque which was given by the accused to him. The fact that after receipt of the notice the accused had approached DW2/Kishor Borkar is repeated by DW2/Kishor Borkar in his cross-examination. Thus, the defence of the accused on the point of receipt of the notice is self contradictory and on the background of the evidence of the complainant this evidence of the defence of the accused cannot be accepted. Thus, complainant has in fact proved all the ingredients under Section 138 of the Negotiable Instruments Act. In such circumstances, the presumption under Section 139 of the Act complainant being holder of the cheque stands in favour of the complainant.

6. The presumption under Section 139 of the Act is rebutable and, therefore, the defence taken by the accused is to be looked into. The respondent/original accused has stepped in the witness box and in support of his defence he examined DW2/Kishor Borkar. The accused has deposed that he did not give any cheque to the complainant, but he had handed over one blank cheque to his friend Kishor Borkar who was in need of money. However, the said cheque was misplaced by Mr. Kishor Borkar and he came to know this fact of loss of the cheque when he received the summons of the cheque after verifying about cheque to Kishor Borkar. DW2/Kishor Borkar corroborates the evidence of accused. However, evidence of the accused and evidence of the defence witness Kishor Borkar though corroborate each other do not inspire any confidence about truthfulness of the defence. DW2/Kishor Borkar has stated that when he received cheque from the accused he did not present the said cheque in the bank, but he carried that cheque in his briefcase, which was lost and therefore he lodged the complaint to Ponda police station on 25/10/2007. It is to be noted that the cheque bears the date of 12/07/2008 and the incident of lodging the FIR, if accepted, is much prior to the date of the cheque. This fact of time distortion frustrates the defence of the accused. Evidence of DW2/Kishor Borkar is not found reliable. Especially, on the background of admissions given by him in the cross-examination are looked into. There were some cases against him under Section 138 of the Negotiable Instruments Act. Considering entire evidence of this witness his evidence is not at all reliable. Thus, the accused could not bring on record the preponderance of the probabilities to dislodge the presumption which stands in favour of the complainant.

7. The learned Magistrate has committed error in accepting evidence of DW2/Kishor Borkar, without analysing the same on the basis of the relevant circumstances and the evidence tendered by the complainant. The learned Judge has also failed to take into account the presumption which stands in favour of the complainant under Section 139 of the Negotiable Instruments Act. Thus, the judgment of the learned Magistrate is to be set aide. The complainant has proved the case that the accused has issued cheque of Rs.1,00,000/- (Rupees one lac only) on Madgaon Urban Co-operative Bank, Ponda in discharge of his legally enforceable liability. Thus, he is held guilty under Section 138 of the Negotiable Instruments Act.

8. Heard the learned Counsel for the respondent/accused and the learned Counsel for the complainant on the point of sentence. The learned Counsel for the respondent/accused submits that the respondent is 55 years old and is not keeping good health. Therefore leniency may be shown. Considered the submission made by the learned Counsel. In view of the facts and the evidence led down, I am of the view that the following sentence will meet the ends of justice:

(a) The order passed by the learned Judicial Magistrate First Class at Mapusa dated 8/07/2010 is hereby set aside,

(b) The accused is held guilty of the offence punishable under Section 138 of he Negotiable Instruments Act of 1881,

(c) He is sentenced to suffer three months simple imprisonment and fine of Rs. 1,10,000/- (Rupees one lac ten thousand only), in default to suffer one month simple imprisonment.

(d) Out of the total amount, fine of Rs.1,00,000/- (Rupees one lac only) is to be paid to the appellant/original complainant.

(d) The learned Judicial Magistrate First Class, Mapusa is directed to take action to issue arrest warrant against the respondent/accused and take further steps to imprison him.

(e) Learned Counsel for the respondent prays for suspension of the order for four weeks to enable him to move to the Hon'ble Supreme Court.

(f) In view of his submissions, the order passed by this Court is suspended for four weeks and, therefore, same bail bond to continue.