Crl. A. No.279 of 2002

4th December, 2007

Petitioner Counsel: G. VIVEKANAND
Respondent Counsel: P. MADHUSUDHANA KUMAR

Cases Cited:
Gorantla Venkateswara Rao Vs. Kolla Veera Raghava Rao, 2006 ALL MR (Cri) JOURNAL 54=2006 Crl.L.J. 1 [Para 8,9]
K. N. Beena Vs. Muniyappan, 2002(1) ALL MR 277 (S.C.)=AIR 2001 SC 2895 : (2001)8 SCC 458 [Para 8,10]
Sharada Finance Corporation Vs. L. Laxman Goud, 2004(2) ALT (Crl.) 9 [Para PARA8,11]
Krishan Bodhankar Vs. M. A. Hameed, 1997(2) ALT (Crl.) 395 [Para PARA12,13]
B. P. Venkateswarlu Vs. K. P. Mani Nayar, 2001(3) ALL MR (JOURNAL) 13=2001(1) ALD (Crl.) 544 (Karn.) [Para 12,14]
M. S. Narayana Menon alias Mani Vs. State of Kerala, 2006(5) ALL MR 33 (S.C.)=(2006)6 SCC 39 [Para 12,15]
Laxminivas Agarwal Vs. Andhra Semi Conductors Pvt. Ltd., Hyderabad, 2006(1) ALD (Crl.) 300 (AP) [Para PARA12,16,17]
V. K. Gemini Vs. Chandran, 2007 Cri.L.J. 1285 [Para PARA12,19]
Kamala S. Vs. Vidyadharan M.J, 2007 ALL SCR 1448 : 2007(2) Crimes 318 (S.C.) [Para PARA 12,20]
Shri. Taher N. Khambati Vs. M/s. Vinayak Enterprises, Secunderabad, 1995 Crl.L.J. 560 [Para PARA17,28]
I.C.D.S. Limited Vs. Beena Shabeer, AIR 2002 SC 3014 : (2002)6 SCC 426 [Para PARA25]
K. P. Pathikumar Vs. N. K. Santhamma, 2007 Cri.L.J. 2643 (Ker.) [Para PARA25]
B. P. Venkateswarlu Vs. K. P. Mani Nayar, 2001 ALL MR (Cri) JOURNAL 59=2001(1) ALD (Crl.) 544 (Karn.) [Para 12,14]

JUDGMENT

-This criminal appeal is directed against the judgment dated 17.9.2001 passed in C.C. No.2 of 1998 on the file of the Judicial Magistrate of First Class, Nuzvid, Krishna District, whereby and whereunder the learned Magistrate found accused Kadam Kandoji not guilty for the offence under Section 138 of the Negotiable Instruments Act, 1881, (for short, 'the N.I. Act'), and acquitted him accordingly.

2. The appellant is the complainant and the first respondent is the accused in C.C. No.2 of 1998. The parties hereinafter referred to as the complainant and the accused.

3. It is the case of the complainant that the accused took a hand loan of Rs.25,000/- from him in October, 1997. The accused issued Ex.P1 cheque dated 5.11.1997 for Rs.25,000/- drawn on State Bank of Hyderabad, Nuzvid Branch, towards discharge of hand loan. The complainant presented the cheque for collection and thereupon the cheque came to be dishonoured on the ground of insufficient funds. The complainant got issued Ex.P3 notice to the accused as contemplated under Section 138(b) of the N.I. Act calling upon the accused to make good the amount covered under the cheque in question. The accused despite receiving the notice, neither paid the money covered under the cheque in question nor issued any reply. Hence, the complainant filed the complaint before the Judicial Magistrate of First Class, Nuzvid.

4. The learned Magistrate took the complaint on file as C.C. No.2 of 1998 and issued process. In response to the summons, the accused entered appearance. On examination under Section 251, Cr.P.C., putting the substance of accusations levelled against the accused, the accused denied the accusations leveled against him and pleaded not guilty for the offence under Section 138 of the N.I. Act and claimed to be tried.

5. To substantiate the accusations levelled against the accused, the complainant got himself examined as PW-1 and marked five documents as Exs.P1 to P5. It is the plea of the accused that the complainant purchased Ac.1.50 cents of land situated in Narsupet Village from him for a consideration of Rs.45,000/- under a possessory agreement of sale and thereafter the complainant approached him and represented that his wife had been giving some trouble since the land purchased by him was not fetching profits and requested him to issue a signed blank cheque as security for the consideration received from him and thereupon, he obliged him by issuing a cheque for Rs.25,000/-, on assurance that the cheque would be returned to him after sale of the land to third parties. To probabalise his defence, he got himself examined as DW-1.

6. The learned Magistrate, on appreciation of the evidence brought on record and on hearing the Counsel for the parties, came to the conclusion that the accused issued Ex.P1 cheque as a security and thereby proceeded to record acquittal of the accused for the offence under Section 138 of the N.I. Act, by judgment dated 17.9.2001. Hence, this criminal appeal by the complainant.

7. Heard learned Counsel appearing for the complainant and learned Counsel appearing for the 1st respondent/accused.

8. Learned Counsel appearing for the complainant submits that the trial Court overlooked the presumptions available in favour of the complainant under Sections 118(a) and 139 of the N.I. Act and thereby erred in recording acquittal of the 1st respondent/accused for the offence under Section 138 of the N.I. Act. A further submission has been made that the defence pleaded by the 1st respondent/accused is neither probabalised nor proved the circumstances capable of drawing inference as to the probability of the defence pleaded by the 1st respondent/accused. In support of his submissions reliance has been placed on the following decisions :

(1) Gorantla Venkateswara Rao Vs. Kolla Veera Raghava Rao and another, 2006 Crl.L.J. 1 : [2006 ALL MR (Cri) JOURNAL 54].

(2) K. N. Beena Vs. Muniyappan, AIR 2001 SC 2895 = (2001)8 SCC 458 : [2002(1) ALL MR 277 (S.C.)].

(3) Sharada Finance Corporation Vs. L. Laxman Goud, 2004(2) ALT (Crl.) 9.

9. In Gorantla Venkateswara Rao Vs. Kolla Veera Raghava Rao and another case [2006 ALL MR (Cri) JOURNAL 54] (supra), our High Court held that failure of accused in giving reply to legal notice issued by complainant is one of strong circumstances to draw an inference that accused borrowed amount from complainant and cheque was issued towards part payment of legally enforceable debt. Para 40 of the cited judgment needs to be noted and it is thus :

"The mere loss of the demand promissory note or its non-production by itself would not be sufficient to hold that there was no legally enforceable debt. There are no other probable circumstances placed by the accused in the process of discharge of his burden. The failure of the accused in giving reply to the legal notice issued by PW-1 is one of the strong circumstances to draw an inference that the accused borrowed the amount from PW-1 and the cheque was issued towards part payment of the legally enforceable debt."

It is further held therein that once the accused failed to point out the circumstances leading to a doubt either on the prosecution version, or leading to a conclusion probabalising the defence version that the blank promissory note and the blank cheque were used to implicate the accused, he cannot escape from criminal liability under Section 138 of the N.I. Act.

10. In K.N. Beena Vs. Muniyappan's case [2002(1) ALL MR 277 (S.C.)] (supra), the Supreme Court held that under Section 118 of the N.I. Act, unless the contrary was proved, it is to be presumed that the Negotiable Instrument (including a cheque) had been made or drawn for consideration. Under Section 139 of the N.I. Act, the Court has to presume, unless the contrary was proved, that the holder of the cheque received the cheque for discharge, in whole or in part of a debt or liability. Thus in complaint under Section 138, the Court has to presume that the cheque had been issued for a debt or liability. The presumption is rebuttable. However, the burden of proving that a cheque had not been issued for a debt or liability is on the accused. Para 6 of the cited judgment needs to be noted and it is thus:

"In our view the impugned judgment cannot be sustained at all. The judgment erroneously proceeds on the basis that the burden of proving consideration for a dishonoured cheque is on the complainant. It appears that the learned Judge had lost sight of Sections 118 and 139 of the Negotiable Instruments Act. Under Section 118, unless the contrary was proved, it is to be presumed that the Negotiable Instrument (including a cheque) had been made or drawn for consideration. Under Section 139 the Court has to presume, unless the contrary was proved, that the holder of the cheque received the cheque for discharge, in whole or in part of a debt or liability. Thus in complaints under Section 138, the Court has to presume that the cheque had been issued for a debt or liability. This presumption is rebuttable. However, the burden of proving that a cheque had not been issued for a debt or liability is on the accused. This Court in the case of Hiten P. Dalal Vs. Bratindranath Banerjee, (2001) 6 SCC 16 : [2001 ALL MR (Cri) 1497 (S.C.)], has also taken an identical view."

11. In Sharada Finance Corporation Vs. L. Laxman Goud case (supra), learned Single Judge of this Court held that a mere suggestion to the complainant that he obtained a blank cheque from the accused without placing any other material to substantiate it is not sufficient to rebut the presumptions available in favour of the drawee/payee of a cheque under Section 139 of the N.I. Act. It is further held that once a fact has been stated by the witness and the same is neither denied nor disputed by the accused, it can be said that such a fact is admitted. For better appreciation, I may refer Para 17 of the cited judgment and it is thus :

17. The other finding of the lower Court is that the appellant-complainant failed to prove that the cheque was issued for any legally enforceable debt or liability. The learned Magistrate placed burden of proof on the complainant to show that it was issued for legally enforceable debt. Once the issuance of cheque is admitted, the burden is on the accused to show that it was not issued for any legally enforceable debt or liability under Section 139 of the Act. Except stating that he signed the Blank Cheque, he did not state that Ex.P1 was obtained simultaneously at the time of execution of the promissory note. According to DW-1, the promissory note was executed by him on 30.5.1996. It was suggested to DW-1 that Ex.P1 cheque was issued by him, but he admits that he issued the cheque but he says that it was a Blank Cheque when it was handed over to the complainant company. The contention of the accused is that he did not give the cheque on 9.11.1998 and to prove the same Ex.D1, which is the passbook relating to him, is filed. As seen from Ex.D1, the cheque bearing No.587 was not presented to the Bank. The cheque bearing numbers before 587 and after 587, which were presented by the accused, were encashed. This particular number is missing as seen from the passbook. The Cheque Nos.581 to 586,588 and 589 were presented by the accused in the year 1994. So, by that time the accused did not borrow any amount from the appellant-complainant. Even according to the accused, he borrowed the amount on 30.5.1996 and on that date itself he issued, according to him, a blank cheque. If that is so, the missing of cheque bearing No.587 in Ex.D1 in the year 1994 is of no consequence because by then he did not borrow any amount from the complainant. So, the burden is on the accused to show that he did not give the cheque in question on 9.11.1998. The cheque number as mentioned in Ex.D1 did not tally with the cheque number in Ex.P1 to infer that Ex.P4 was issued in the year 1996. So the burden placed on the accused is not discharged by him. Hence, the presumption under Section 138 of the Negotiable Instruments Act can be drawn in this case, when it is the specific case of PW-1 that the accused gave the cheque in question towards discharge of loan of Rs.1,50,000.00 availed by him on 30.5.1996, the said statement remained unchallenged. Once a fact has been stated by the witness and the same is neither denied nor disputed by the accused, it can be said that such a fact is admitted. Therefore, the complainant prima facie proved that the cheque in question was issued for legally enforceable debt or liability. Therefore, the finding of the learned Magistrate on this aspect is contrary to law."

It is further held that whenever a cheque was issued towards partial discharge of the loan and when it was dishonoured after admitting the borrowal of the amount from the complainant, his plea that he gave a blank cheque duly signed in favour of the complainant does not amount to rebutting the presumption with regard to existence of subsisting liability.

12. The learned Counsel appearing for the 1st respondent/accused submits that the trial Court, on through analysis of the evidence brought on record, came to the conclusion that the 1st respondent/accused is able to probabalise his defence that the cheque in question was not issued towards legally enforceable debt or liability and that it was issued in the circumstances set out as a security and thus, the judgment of acquittal passed by the trial Court is legal and proper and the same is not liable to be set aside. A further submission has been made that the appellant/complainant failed to prove basic facts to draw the presumptions available under Sections 118(a) or 139 of the N.I. Act, and thus, the acquittal of the 1st respondent/accused for the offence under Section 138 of the N.I. Act is legal and proper and the same is not liable to be set aside. To buttress his submissions, reliance has been placed on the following decisions :

(1) Krishan Bodhankar Vs. M. A. Hameed and another, 1997 (2) ALT (Crl.) 395.

(2) B. P. Venkateswarlu Vs. K. P. Mani Nayar, 2001(1) ALD (Crl.) 544 (Karn.) : [2001(3) ALL MR (JOURNAL) 13 : 2001 ALL MR (Cri) JOURNAL 59].

(3) M. S. Narayana Menon alias Mani Vs. State of Kerala and another, (2006)6 SCC 39 : [2006(5) ALL MR 33 (S.C.)].

(4) Laxminivas Agarwal Vs. Andhra Semi Conductors Pvt. Ltd., Hyderabad and others, 2006(1) ALD (Crl.) 300 (AP).

(3) V. K. Gemini Vs. Chandran and another, 2007 Cri.L.J. 1285.

(6) Kamala S. Vs. Vidyadharan M.J, and another, 2007(2) Crimes 318 (SC) : [2007 ALL SCR 1448].

13. In Krishan Bodhankar's case (supra), the accused took the plea of discharge of his liability under a pronote dated 11.7.1988 and he marked the pronote returned by the Finance Corporation consequent on payment of the amount due thereunder. In such circumstances, a learned Single Judge of this Court came to observe that the complainant/Finance Corporation failed to place on record any material to speak of the subsisting liability of the accused on the date of issuance of cheque in question which came to be returned with an endorsement 'refer to drawer'.

14. In B. P. Venkateswarlu Vs. K. P. Mani Nayar [2001(3) ALL MR (JOURNAL) 13 : 2001 ALL MR (Cri) JOURNAL 59] (supra), the Karnataka High Court held that presumption as regards subsisting liability is rebutable presumption and when the circumstances found to be badly damaging the credibility of the prosecution case, presumption gets replaced and thereupon heavy burden lies on the prosecution to prove the subsisting liability.

15. In M. S. Narayana Menon @ Mani's case [2006(5) ALL MR (S.C.) 33] (supra), the Supreme Court held that when the accused is able to rebut the presumption by raising a probable defence, the onus thereafter shifts on to the complainant to prove his case. Whether initial burden has been discharged by the accused is a question of fact. Burden of proof on accused is not heavy and he need not disprove the prosecution case in its entirety. He can discharge his burden on the basis of preponderance of probabilities through direct or circumstantial evidence.

16. In Laxminivas Agarwal Vs. Andhra Semi Conductors Pvt. Ltd., Hyderabad and others (supra), learned Single Judge of this Court held, in the facts and circumstances of the given case, that the accused was able to prove by the date of taking of the cheques, which were exhibited as Exs.P1 to P3, from the accused, there was no debt or liability incurred by the accused towards the complainant.

17. In Shri. Taher N. Khambati Vs. M/s. Vinayak Enterprises, Secunderabad and others, 1995 Crl.L.J. 560, the accused took the plea of the complainant obtaining a blank cheque and thereafter the complainant filled-up blanks in the cheque as if it was issued for a sum of Rs.1,18,337/- being the total amount due under the pronote after giving credit to the payment already made. It is the case of the accused therein that the complainant put the date alone on the cheque. At the cost of repetition I may state that the plea of the accused therein was that he issued a total blank cheque and the complainant filled-up including the quantum of amount. The learned Single Judge of this Court in Laxminivas Agarwal's case (supra), followed the above referred judgment. The plea of the accused in Shri. Taher N. Khambati's case (supra), was one of interpolation of quantum of amount in the cheque and it was not a case of putting the date alone on the cheque.

18. There is striking distinction between the blank cheque and undated cheque. In case of blank cheque, three factors viz., date, name of the payee and quantum of amount are kept unfilled. In case of undated cheque, what is not filled is only with regard to date. When the cheque is admittedly issued with the blank date and when the payee has no objection with regard to the name, amount and signature, it can be presumed that there is an implied consent for putting the date as and when required the beneficiary and get it encashed. In other words when the date is put by the payee or the drawer of the cheque, the presumption under Section 118 of the N.I. Act would arise. The burden is, therefore, entirely on the drawer of the cheque to establish that the payee has no authority to put the date and encash the cheque.

19. In V. K. Gemini's case (supra), the Kerala High Court held that the complainant is bound to establish the basis for drawing the presumption. Paras 53 and 54 of the cited judgment need to be noted and they are thus:

"53. But, if a different interpretation is given, it will be harmful to the society. It may even defeat the very object of the Act. Instead of enhancing the acceptability of cheques in settling the liabilities, it will only retard such acceptability. A situation may arise where none would dare to issue any cheque in genuine transactions, fearing misuse of the same by another. A complainant will be able to secure a conviction even without proving his right to possess the cheque and to receive or recover the amount due thereon from the drawer. The possibility of an unwarranted prosecution and even an unmerited conviction would certainly haunt his thoughts and deter him from issuing cheques. The Court shall not close its eyes to such probable realities. An interpretation which is likely to defeat the object of the Act has to be avoided.

54. Hence, in my view, the expression 'holder' is cautiously used in Section 139 of the Act so that the presumption under the said section shall be drawn in favour of the complainant, only if it is established by evidence and other materials on record that he is the 'holder' of the cheque, as defined under Section 8 of the Act. In the absence of establishing the same, no presumption shall be drawn under Section 139, in favour of the complainant, who may ordinarily be the 'payee' or 'holder in due course', as the case may be. If this is not insisted, there may be chances for misuse of the provision which will defeat the very object of the enactment."

20. In Kamala S.'s case (supra), the Supreme Court held that standard of proof in discharge of the burden in terms of Section 139 of the N.I. Act being of preponderance of a probability, the inference therefore can be drawn not only from the materials brought on record but also from the reference to the circumstances upon which the accused relies upon.

21. The offence under Section 138 of the N.I. Act can be completed only with the concatenation of a number of the acts. Following are the acts which are the components of the said offence.

(1) Drawing of the cheque

(2) Presentation of the cheque into the Bank.

(3) Returning of the cheque unpaid by the drawee bank.

(4) Giving notice in writing to the drawer of the cheque demanding the payment of the cheque amount.

(5) Failure of the drawer to make payment within 15 days of the receipt of the notice.

22. The Act contains provisions raising presumptions as regards the negotiable instruments under Section 118(a) of the Act as also under Section 139 thereof. The said presumptions are rebutable. Whether presumption rebutted or not would depend upon the facts and circumstances of each case. The Supreme Court clearly laid down in catena of decisions that the standard of proof in discharge of the burden in terms of Section 139 of the N.I. Act being the preponderance of a probability, the inference thereof can be drawn not only from the material brought on record but also from the reference to the circumstances upon which the accused relies upon. The burden to rebut the presumptions on the accused is not as high as that of the prosecution.

23. The meaning of the expression 'may presume' and 'shall presume' have been explained in Section 4 of the Evidence Act, 1872. 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 words 'proved' and 'disproved' have been defined in Section 3 of the Evidence Act. Applying the definition of proved or disproved to the principle behind Section 118(a) of the Act, the Court shall presume a negotiable instrument to be for consideration unless and until after consideration of the matter before it, it either believes that the consideration does not exist or considers the non-existence of the consideration so probable that a prudent man under the circumstances does not exist. For rebutting such presumptions, 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. Whether in the given facts and circumstances of a case, the initial burden has been discharged by the accused would be a question of fact. It was a matter relating to appreciation of evidence. There are certain cases in which statutory presumptions arise regarding the guilt of the accused, but the burden even in those cases is upon the prosecution to prove the existence of facts, which have to be present before the presumption can be drawn. Once those facts are shown by the prosecution to exist, the Court can raise the statutory presumption and it would, in such event, be for the accused to rebut the presumption. The onus even in such cases upon the accused is not so heavy as is normally upon the prosecution to prove the guilt of the accused. If some material brought on record consistent with the innocence of the accused, which may reasonably be true, even though it is not possibly proved to be true, the accused would be entitled to acquittal.

24. It is now well known that the object of the provisions of Section 138 of the Act is that for the proper and smooth functioning of business transaction in particular, use of cheques or negotiable instruments would primarily depend upon the integrity and honesty of the parties.

25. There used to be some discussion as to whether the cheque issued as security would attract the liability under Section 138 of the N.I. Act, in the event of its dishonour. The said discussion is settled at rest and it has been held by the Supreme Court in I.C.D.S. Limited Vs. Beena Shabeer, AIR 2002 SC 3014 = (2002)6 SCC 426, that even if the cheque was issued as security, it would attract the liability under Section 138 of the N.I. Act. The Kerala High Court in K. P. Pathikumar Vs. N. K. Santhamma, 2007 Cri.L.J. 2643 (Ker.), held that once issuance of cheque as security for repayment of loan is admitted, it will not take transaction out of sweep of Section 138 of the N.I. Act.

26. Keeping in view decisions of various High Courts and Apex Court on the aspect of the nature of evidence which the accused is required to be adduced to rebut the presumptions available under Section 118(a) of the N.I. Act as also under Section 139 thereof in favour of the complainant, I may proceed to discuss the evidence in the case on hand.

27. DW-1 is the accused. He admits of issuing Ex.P1 cheque in favour of the petitioner. It is the specific case of the complainant that the accused borrowed Rs.25,000/- as hand loan and issued Ex.P1 cheque to discharge the hand loan. When once the accused admits of issuance of cheque, the presumptions available under Sections 118 and 139 of the N.I. Act come into operation. Under Section 118 of the N.I. Act every cheque is presumed to be drawn for consideration. Under Section 139 of the N.I. Act every cheque is presumed to be issued towards discharge of the legally enforceable debt. The accused took the plea that the complainant purchased land from him in the year 1994 and since his title in respect of the property is found to be defective, the complainant made him to issue Ex.P1 cheque so as to convince his wife that the consideration paid under sale deed is well secured by obtaining a cheque from the accused. In a way the plea of the accused is that he issued the cheque since the title of him over the property which he sold to the complainant found to be defective. It is a matter of record that the complainant sold the said property to Venkata Narayana of Narsupet. This fact is within the knowledge of the accused. If the cheque in question was issued by him as a security for the consideration received from the complainant in respect of a land which is found to be D.K.T. land, he must have insisted the complainant to return the cheque as soon as the complainant sold the same to third parties. The complainant issued Ex.P3 notice calling upon the accused to pay the amount covered under the cheque in question consequent on its dishonour. The accused did not choose to give any reply to Ex.P3 notice. The accused while being examined as DW-1 came forward with a plea that he approached the complainant after receipt of the notice. But, he did not choose to say what the complainant replied. Indeed nothing was suggested to the complainant-PW-1 in the cross-examination that the accused approached him after receipt of Ex.P3 notice. In these circumstances, can it be said that the accused is able to dispel the presumptions available in favour of the complainant under Sections 118 and 139 of the N.I. Act. In my considered view, the reply should be negative. The trial Court proceeded on the line that the blank cheque is not a cheque within the meaning of Section 138 of the N.I. Act. The complainant while being examined as PW-1 has specifically stated that he filled the cheque on being asked by the accused. For better appreciation, I may refer the relevant portion of the evidence of PW-1 (complainant) and it is thus :

"I lent amount to the accused and after obtaining Ex.P1 post dated cheque evidencing my lending on the very same date. The accused promised me to deposit the amount mentioned in the cheque within one or two months from the date of Ex.P1. He also stated his source of income i.e., from mango business to deposit the amount. I lent the amount to the accused in early days of October, 1997. Accused asked me to fillup the cheque. I filled up then accused signed in Ex.P1".

28. Had the accused delivered a blank cheque, he would have definitely issued a reply to Ex.P3 notice. Failure of the accused in issuing reply is a strong circumstance to demolish the plea taken by him. It is also to be noted that the complainant sold the land, which he purchased for Rs.45,000/- from the accused to Venkata Narayana of Narsupet Village. If the accused issued the cheque as security, it must have been for Rs.45,000/- and not for Rs.25,000/-. The accused must have demanded the complainant to return the cheque, which he claimed to have issued as security soon after the complainant disposing of the land. In these circumstances, the accused in my considered view has failed to probabalize his defence that he issued Ex.P1 cheque as security. The trial Court placing reliance on the judgment in Shri. Taker N. Khambati's case (supra), proceeded to conclude that the blank cheque is not a cheque contemplated under Section 138 of the N.I. Act. In Para 17 of the judgment, I detailed the facts in the cited case and the circumstances under which the cheque therein came to be issued. The facts in the above referred case and the facts in the case on hand are distinctive and therefore, the cited case is of no help to the accused. The appellant/complainant is able to prove that the accused issued Ex.P1 cheque towards discharge of legally enforceable debt. Indisputably Ex.P1 cheque came to be dishonoured for want of sufficient funds. Thus, the 1st respondent/accused is liable for conviction for the offence under Section 138 of the N.I. Act.

29. The cheque is dated 5.11.1997 and 10 years have been elapsed since the date of issuance of cheque. Keeping these aspects in view, I am not inclined to impose any corporeal punishment. This is a fit case where provisions of sub-section (3) of Section 357, Cr.P.C. are required to be invoked.

30. In the result, the criminal appeal is allowed setting aside the judgment of acquittal of the 1st respondent/accused passed in C.C. No.2 of 1998 on the file of the Judicial Magistrate of First Class, Nuzvid, Krishna District, and the 1st respondent/accused is convicted for the offence under Section 138 of the N.I. Act and he is directed to pay a compensation of Rs.25,000/- under sub-section (3) of Section 357, Cr.P.C. to the complainant within four weeks, in default to suffer simple imprisonment for six months.

Appeal allowed.