S.A. No.457 of 2007,M.P. No.1 of 2007

2nd January, 2012

Petitioner Counsel: Mr. V. SINGAN
Respondent Counsel: Mr. A. SARAVANAN

Cases Cited:
Tarachand Vs. Sikri Bros., AIR 1953 Bom 290 [Para 26,29]
Kadarkarai Reddiar Vs. Arumugam Nadar, AIR 1992 Madras 346 [Para 26]
Shaha Vs. Dulhal, AIR 1939 Rang 334 [Para 26]
Briar Vs. Quackerstein, (1848) 12 LT (OS) 153 [Para 27]
Griffiths Vs. Dalton, (1940) 2 KB 264 [Para 27]
Sesharal Bajna Vs. Subramanian (VC), AIR 1983 Madras 368 [Para 27]
Scard Vs. Jackson, (1875) 34 LT (NS) 65- n [Para 28]
Herdman Vs. Wheeler, (1902) 1 KB 361, 369 [Para 28]
Stoessiger Vs. SERy Co., (1854) 3 E & B 549 [Para 28]
Garrrard Vs. Lewis, (1882) 10 QBD 30 [Para 29]
Guildford Trust Ltd., Vs. Goss, (1927) 136 LT 725: 43 TLR 167 [Para 29]
Ram Sarup Vs. Hardeo, AIR 1928 All 68 [Para 32]
Anil Kumar Sawhney Vs. Gulshan Rai, (1994) 79 Comp Cas 150 (SC) [Para 32,33]
Sher Singh Vs. Vijay Kumar and another, AIR 1980 Punjab & Haryana 270 [Para 37]
Avon Organics Limited Vs. Poineer Products Limited and others, 2003 ALL MR (Cri) JOURNAL 105=2004-Vol.119-Company Cases-18 [Para 40]
Bhaskaran Vs. Radhakrishnan, 1998 (2) Bank CLR 384 (Ker.) [Para 46]
NEPC Micon Limited Vs. Magma Leasing Limited, 1999(4) ALL MR 367 (S.C.)=1999 Cri LJ 2883 (SC) [Para 49]
NEPC Micon Limited Vs. Magma Leasing Limited, 1999 ALL MR (Cri) 1837 (S.C.)=1999 Cri LJ 2883 (SC) [Para 49]

JUDGMENT

JUDGMENT :- The Appellant/Defendant has filed this instant Second Appeal as against the Judgment and Decree dated 10.10.2006 in A.S.No.171 of 2004 passed by the Learned Principal Sub Judge, Trichirappalli in confirming the Judgment and Decree of the Learned District Munsif, Turaiyur dated 29.07.2004 in O.S.No.198 of 2002.

2. The First Appellate Court viz., the Learned Principal Sub Judge, Trichirappalli, while passing the Judgment in A.S.No.171 of 2004 on 10.10.2006, has, among other things, observed that 'the plea that Ex.A.1-Cheque has been given in an unfilled form is not acceptable and further Ex.A.1-Cheque is a complete one, which is a negotiable instruments'. Further, it opined that no receipts or other documents have been filed to establish that the Appellant/Defendant has paid a principal sum of Rs.10,000/- together with interest to the Respondent/ Plaintiff etc. and consequently, held that the Appellant/ Defendant has received a sum of Rs.30,000/- from the Respondent/ Plaintiff through Ex.A.1-Cheque, for which no interest or principal amount has been paid by the Appellant/Defendant and passed a decree by directing the Appellant/Defendant to pay the suit amount to the Respondent/Plaintiff and dismissed the Appeal with costs.

3. Being dissatisfied with the Judgment and Decree dated 10.10.2006 in A.S.No.171 of 2006 passed by the First Appellate Court viz., the Learned Principal Sub Judge, Trichirappalli, the Appellant/ Defendant has preferred this Second Appeal before this Court as an aggrieved person.

4. Earlier, before the trial Court in the main suit, on behalf of the Respondent/Plaintiff witness P.W.1 (Respondent/Plaintiff) has been examined and Exs.A.1 to A.7 have been marked. On the side of the Appellant/Defendant, no witness has been examined and also no document has been marked.

5. On an appreciation of the entire oral and documentary evidence available on record, the trial Court has come to a consequent conclusion that it is not true that the Appellant/ Defendant, as per her Written Statement, has received a loan of Rs.10,000/- only and has paid the same and further, it is held that Ex.A.1- Cheque has been issued by the Appellant/Defendant to the Respondent/Plaintiff for the loan amount of Rs.30,000/- received by him and as per Ex.A.1-Cheque, the Appellant/Defendant has received a sum of Rs.30,000/- from the Respondent/Plaintiff and finally, decreed the suit in favour of the Respondent/Plaintiff as prayed for in the Plaint with costs.

6. The Appellant/Defendant filed A.S.No.171 of 2004 before the First Appellate Court and the First Appellate Court viz., the Principal Sub Judge, Trichirappalli, after contest and after analysing the entire materials on record, has passed a Judgment in dismissing the Appeal on 10.10.2006 filed by the Appellant/Defendant.

7. At the time of admission of the Second Appeal, this Court has formulated the following Substantial Questions of Law for consideration:

"i) Whether the Courts below are correct in applying the principles contemplated under Section 20 of the Negotiable Instruments Act to the suit document?

ii) Whether the Courts below are correct in rendering a finding that the suit document is not affected by material alteration when the writings in the face of the documents are by different persons?

iii) Whether the Courts below are correct in placing the burden of proof regarding consideration on the defendant?

iv) Whether the Courts below are correct in applying the principles under Section 138 of the Negotiable Instruments Act to the civil suit when the documents per se and apparently on the face of it appears to be forged?"

The Contentions, Discussions and Findings on Point Nos.1 to 4:

8. According to the Learned Counsel for the Appellant/Defendant, the trial Court as well as the First Appellate Court have incorrectly applied the ingredients of Section 20 of the Negotiable Instruments Act, 1881 and further, both the Courts have failed to take into account of the fact that the suit filed is a tainted one and Ex.A.1-Cheque is a vitiated document which cannot be enforced in law because of the simple reason that the said document suffers from material alteration.

9. The Learned Counsel for the Appellant/Defendant urges before this Court that the Courts below have incorrectly placed the onus of proof as regards as the consideration on the Appellant/Defendant. Further, it is the contention of the Learned Counsel for the Appellant/ Defendant that since the burden of proof regarding the consideration is on the Respondent/Plaintiff, who is to positively prove and establish as regards the passing of consideration.

10. The stand of the Appellant/Defendant is that in Ex.A.1-Cheque there are material discrepancies which clearly go to show that the said document is a forged one.

11. Yet another submission of the Learned Counsel for the Appellant/Defendant is that the negotiation of the suit document through banks for the purpose of encashment and return of the document will not strength the same as a document supported by any valuable consideration.

12. Per contra, it is the submission of the Learned Counsel for the Respondent/Plaintiff that both the Courts have concurrently held that it is not established as projected by the Appellant/Defendant that she received only a loan amount of Rs.10,000/- from the Respondent/ Plaintiff and further that she has paid the principal and the interest amount and further, it is held by both the Courts that the Appellant/ Defendant is liable to pay the said amount to the Respondent/Plaintiff and the said findings rendered by both the Courts need not be disturbed by this Court at this distance point of time.

13. In the Plaint, the Respondent/Plaintiff has averred that the Appellant/Defendant has received a loan of Rs.30,000/- in cash for the purpose of her husband starting a new jewellery shop at Turaiyur Town and in support of the same, on 24.01.2002 a cheque bearing No.357779 in the name of State Bank of India has been given by the Appellant/Defendant. Subsequently, on 24.01.2002 the Appellant/ Defendant has prayed for one month time with the Respondent/ Plaintiff, by mentioning that she will pay the amount together with 12% interest and on that basis, the Respondent/Plaintiff presented the said cheque at the State Bank of India, Turaiyur Branch. But the said cheque has been returned to the Respondent/Plaintiff by the Bank since no sufficient money has been available with the Appellant/ Defendant's account. The conduct of the Appellant/Defendant is a fraudulent one and further, the Appellant/Defendant has issued the cheque without possessing sufficient money in her bank account. Therefore, the Respondent/Plaintiff through his lawyer issued a registered notice dated 22.03.2002 to the Appellant/Defendant demanding the payment of the principal sum together with interest. The Appellant/Defendant has received the said notice. But, no money has been paid by the Appellant/Defendant.

14. Later, the Appellant/Defendant requested the Respondent/ Plaintiff to deposit the cheque on 08.05.2002 or subsequently for receiving the amount. The Respondent/Plaintiff has deposited the said cheque with the State Bank of India, Turaiyur Branch on 08.05.2002. Again the said cheque has been returned on the ground of insufficiency of the fund in the Appellant/Defendant's account. On 18.05.2002 the Respondent/Plaintiff issued a registered notice to the Appellant/ Defendant claiming the principal sum along with interest. But the registered notice has not been received by the Appellant/Defendant wantonly or deliberately and the same has been returned. The Appellant/Defendant has not issued any reply notice. Hence, the suit has been laid for recovery of the principal sum of Rs.30,000/- together with interest of Rs.1,650/- for the period from 24.01.2002 to 10.07.2002 along with suit costs.

15. The Appellant/Defendant, in her Written Statement, has stated that it is complete lie to state that on 14.01.2002 she received a loan amount of Rs.30,000/- for the purpose of establishing the jewellery shop for her husband and for that purpose, a cheque has been issued in favour of the State Bank of India. Added further, a State Bank of India Cheque has been issued. The Appellant/Defendant from the Respondent/Plaintiff has received a loan of Rs.10,000/- only and in support of the said loan of Rs.10,000/-, the Appellant/ Defendant has issued an unfilled pronote without mentioning the amount. For the sum of Rs.10,000/-, the Respondent/Plaintiff demanded an interest of Rs.5/- for Rs.100/- per month and the Appellant/Defendant has paid the full interest amount at times. The Appellant/Defendant has paid the loan amount of Rs.10,000/- to the Respondent/Plaintiff. When the Appellant/Defendant demanded for the return of the cheque, the Respondent/Plaintiff informed the Appellant/ Defendant that he had not remembered the place where he had kept the cheque and said that later he will find out the same and hand over it. The Appellant/Defendant believed the Respondent/Plaintiff and remained silent.

16. Subsequently, the Respondent/Plaintiff for higher amount has filled up the pronote with a view to obtain an unlawful profit and also to deposit the same into Bank, has issued a notice, but without filing a criminal case has filed the civil case. Under the aforesaid circumstances, the Appellant/Defendant, as per the Cheque, is not liable to pay any amount to the Respondent/Plaintiff. Only to get additional money from the Appellant/Defendant, the Respondent/ Plaintiff has filed the suit. There is no cause of action for the suit.

17. At this stage, this Court makes a valuable reference to the evidence of P.W.1 (Respondent/Plaintiff) to appreciate the merits of the case in a proper manner.

18. It is the evidence of P.W.1 (Respondent/Plaintiff) that the Appellant/Defendant's husband has given a complaint against him in the police station and that the police has enquired him and that the Appellant/Defendant's husband after issuance of cheque only has given a police complaint and that the Appellant/Defendant is a Teacher in Welfare School and before issuance of cheque, the Appellant/ Defendant has received a loan amount from him and that from the beginning till the last, a cheque has been written by the Appellant/Defendant.

19. The evidence of P.W.1 is to the effect that he is doing the business of lending money on interest for the past six years. Added further, it is the evidence of P.W.1 (in cross examination) that the figure 'Rs.30,000/-' and the words 'Rupees Thirty thousand alone' are written in the same ink and the name of 'T.Natarajan' and date '24.01.2002' are written in different ink and on the back of the cheque it is her signature and that the Appellant/Defendant has written the amount in the cheque and affixed her signature and all the details in the cheque have been written by the Appellant/Defendant. Moreover, it is the evidence of P.W.1 that the Appellant/Defendant has not given any written authority to the Respondent/Plaintiff to put the date and to take the cheque.

20. Ex.A.1 is the State Bank of India, Turaiyur Cheque dated 24.01.2002 for Rs.30,000/- issued by the Appellant/Defendant to and in favour of the Respondent/Plaintiff. A perusal of Ex.A.1-Cheque dated 24.01.2002 shows that 'Rs.30,000/-' and the words 'Thirty thousand alone' are written in same blue ink by the Appellant/Defendant. Also, in Ex.A.1-Cheque, the Appellant/Defendant has affixed her signature in English. Moreover, in Ex.A.1-Cheque the name of the Respondent/ Plaintiff in column 'Pay to' is written by writing the letter 'T' in English and rest of the words viz., the name of the Respondent/Plaintiff are written as 'Natarajan' in Tamil.

21. Ex.A.2 is the Note Slip dated 13.03.2002 issued by the Branch Manager of the State Bank of India, Turaiyur Branch which refers to the Cheque bearing No.357779 for Rs.30,000/-is returned for the reason No.15 viz., due to insufficiency of funds. In Ex.A.3- Respondent/Plaintiff's lawyer notice dated 22.03.2002 addressed to the Appellant/Defendant, it is, among other things, mentioned that the Appellant/Defendant has informed the Respondent/Plaintiff on 14.01.2002 that her husband is to open a jewellery shop at Turaiyur Town and received a sum of Rs.30,000/- in cash and in support of the same, she issued a negotiable cheque of State Bank of India, Turaiyur Branch dated 24.01.2002 and subsequently asked for a months time of 24.01.2002 and further agreed to pay the amount with 12% interest. Also, in the said notice, it is mentioned that the Respondent/Plaintiff on 13.03.2002 has presented the cheque in the Bank and at that time, the cheque has been returned by the Bank owing to the insufficiency of funds in the Bank account of the Appellant/Defendant and that the Appellant/Defendant has no money in her Bank account has issued the cheque deliberately with a view to cheat the Respondent/Plaintiff and has cheated the Respondent/Plaintiff and therefore, has committed an offence as per Section 138 of the Negotiable Instruments Act, 1881. In short, in Ex.A.3 the Respondent/Plaintiff is demanded the repayment of the amount of Rs.30,000/- together with interest at 12% within 15 days from the date of notice.

22. Continuing further, in Ex.A.3-Notice dated 22.03.2002 there is no reference to the effect that the said notice has been issued for the written of amount of Rs.30,000/- mentioned in the cheque apart from the balance amount to be received by the Respondent/Plaintiff in regard to the sum of Rs.25,000/- received as loan and execution of a pronote for Rs.25,000/- on 09.01.2002 by the Appellant/Defendant and her husband.

23. Ex.A.5 is the Note Slip dated 08.05.2002 of the State Bank of India, Turaiyur Branch which speaks of cheque bearing No.357779 for Rs.30,000/- addressed to the Respondent/Plaintiff specifying the reason for the return of the cheque viz., due to insufficiency of funds. Ex.A.6 is the Respondent/Plaintiff's second lawyer notice dated 18.05.2002 addressed to the Appellant/Defendant wherein it is mentioned that the Appellant/Defendant has been informed of her obligation to pay the amount on the dishonoured cheque as per issuance of notice under Section 138 of the Negotiable Instruments Act. Further, the second lawyer's notice dated 18.05.2002 mentions that on 14.01.2002 the Appellant/Defendant issued a cheque bearing No.SB 00/126 357779 dated 24.01.2002 for Rs.30,000/- (Thirty thousand only) drawn in favour of the Respondent/Plaintiff on the State Bank of India, Turaiyur Branch in discharge of borrowing of Rs.30,000/- on 14.01.2002 for the purpose of starting a jewellery business for her husband and when the cheque has been dishonoured, the Respondent/Plaintiff has issued Notice-Ex.A.3 through his Advocate on 22.03.2002, intimating about the dishonour of cheque and further, on receipt of the notice, she met the Respondent/Plaintiff on 31.03.2002 and expressed regret for the inability to provide the fund in time and made a request to the Respondent/Plaintiff to represent the cheque on or after 08.05.2002 etc.

24. Apart from the above, in Ex.A.6- Respondent/Plaintiff's second lawyer notice, it is mentioned that believing the representation of the Appellant/Defendant, the Respondent/Plaintiff represented the cheque for collection through the State Bank of Turaiyur on 08.05.2002 and further, called upon the Appellant/Defendant to pay the amount within 15 days failing which, prosecution will be launched against her as per Section 138 of the Negotiable Instruments Act, 1881.

25. Ex.A.7 is the Returned Registered Post Cover with Acknowledgement Due [pertaining to Ex.A.6 second lawyer's notice]. As per Ex.A.7-Returned Registered Postal cover with acknowledgement due, the Appellant/Defendant has returned the cover and on back of the cover the endorsement made by the postal authority is that 'Door Locked' on 20.05.2002 and further intimations have been given on 22.05.2002. Inspite of the same, Ex.A.6-Respondent/Plaintiff's lawyer's notice dated 18.05.2002 sent to the Appellant/Defendant as Ex.A.7 has been returned 'Unserved'.

26. It is to be pointed out that Section 20 of the Negotiable Instruments Act refers to 'Inchoate stamped instruments'. As a matter of fact, Section 20 of the Negotiable Instruments Act casts a liability on an individual who allows an incomplete instrument to go out in the world and as such, it is to be strictly construed as per decision in Tarachand V. Sikri Bros, AIR 1953 Bom 290. Although Section 20 of the Act authorises an individual to complete the inchoate instrument delivered to him by completing it, he does not become holder in due course of that instrument because the transfer and negotiations in such a case to the payee is not of a negotiable instrument but is only of an inchoate instrument which is not a negotiable instrument and as he is not 'Holder in Due Course' of that document he cannot recover the amount as per decision in Kadarkarai Reddiar V. Arumugam Nadar AIR 1992 Madras 346. To raise a prima facie presumption of authority to Section 20 of the Negotiable Instruments Act requires a delivery by the person to another. Since the section gives the authority to fill up only to a holder, it presupposes a negotiation on the part of the person signing the blank or incomplete instrument. However, when an individual takes a stand that he has not signed the instrument in the form in which it is found, then, the burden is on him to prove the same as per decision in Shaha V. Dulhal AIR 1939 Rang 334.

27. The instrument may be completely blank or incomplete in any particular manner. In either way, the holder has the authority to make or complete the instrument as a negotiable one. If the date be left blank, any holder has the right to insert the true date as per decision in Briar V. Quackerstein (1848) 12 LT (OS) 153, within a reasonable time [as per decision Griffiths V. Dalton (1940) 2 KB 264] and necessarily before filing a case on the basis of such not dated instrument as per decision in Sesharal Bajna V. Subramanian (VC) AIR 1983 Madras 368.

28. Furthermore, if an individual accepts a bill blank as to the name of the drawer and delivers the same to another, he is entitled to insert his name as drawer as per decision in Scard V. Jackson (1875) 34 LT (NS) 65-n, or put it in negotiation, the transferee acquiring that right as per decision in Herdman V. Wheeler (1902) 1 KB 361, 369. Till it is completed by filling up the drawer's name, the instrument cannot be a Bill and no liability will arise on the same as per decision in Stoessiger V. SERy Co (1854) 3 E & B 549.

29. Indeed, the implied authority by means of a signature in respect of a blank instrument is such that a person/party so signing is bound to a 'Holder in Due Course' even though the Holder is authorised to fill for a specified amount. To enable a person to claim the rights of a 'Holder in Due Course' the instrument ought to have been completed before it is negotiated to him. As to the Bona fide Holder for value, he is protected and he is entitled to recover though the amount for which it is intended to be issued is materially altered [as per decision in Garrrard V. Lewis (1882) 10 QBD 30.] or even if the instrument is fraudulently utilised for a purpose other than the one for which it is intended [as per decision in Guildford Trust Ltd., V. Goss (1927) 136 LT 725: 43 TLR 167].

30. One cannot ignore an important fact that Section 20 of the Negotiable Instruments Act is not applicable to a cheque crossed as 'not negotiable'.

31. Section 20 of the Negotiable Instruments Act enjoins as a condition of liability that an individual signing and to deliver the instrument to another. At this stage, this Court refers to Section 20 of the Negotiable Instruments Act which runs as follows:

"20.Incholate stamped instruments.- Where one person signs and delivers to another a paper stamped in accordance with the law relating to negotiable instruments then in force in Substituted for the words "the States" by section 3 and Schedule II of Act 3 of 1951 [India], and either wholly blank or having written thereon an incomplete negotiable instrument, he thereby gives prima facie authority to the holder thereof to make or complete, as the case may be, upon it a negotiable instrument, for any amount specified therein and not exceeding the amount covered by the stamp. The person so signing shall be liable upon such instrument, in the capacity in which he signed the same, to any holder in due course for such amount: Provided that no person other than a holder in due course shall recover from the person delivering the instrument anything in excess of the amount intended by him to be paid thereunder."

32. he essential feature of a cheque is that it must be payable instantly on demand, as opined by this Court. A cheque is a Bill of Exchange drawn on a banker payable on demand as per Section 73 of Bills of Exchange Act. It cannot be gainsaid that a cheque is always drawn on bank or a banker, and is payable immediately on demand without any grace days as per decision in Ram Sarup V. Hardeo AIR 1928 All 68. A Bill of Exchange is a negotiable instrument in writing specifying an instruction to a third person to pay a stated sum of amount at a designated future date or on demand. However, a 'Cheque' is a bill of exchange drawn on a bank by the holder of an account payable on demand. A 'Cheque' as per Section 6 of the Negotiable Instruments Act is also a Bill of Exchange, which is drawn on a banker and is payable on demand. Although a bill of exchange is drawn on a banker, if it is payable on demand, it is not a cheque as per decision of the Hon'ble Supreme Court in Anil Kumar Sawhney V. Gulshan Rai (1994) 79 Comp Cas 150 (SC).

33. A cheque is issued for immediate payment. A payment by a cheque prima facie is to wipe out an existing debt, not to create a new one. Inasmuch as a cheque is not a tender but is only a means of the issuance of a cheque for an antecedent debt operates only as a conditional payment. A cheque, unless dishonoured, is payment when it is cleared. Payment by cheque is as good as payment in cash provided it is honoured. It is remembered that a post dated cheque is only a Bill of Exchange when it is written or drawn and it becomes a cheque when it is payable on demand. However, a post dated cheque is not payable till the date which is mentioned on the document itself and it will become a cheque only on the date specified therein as per decision of Hon'ble Supreme Court in Anil Kumar Sawhney V. Gulshan Rai (1994) Company Cases 150 (SC).

34. As per Section 125 of the Negotiable Instruments Act where a cheque is uncrossed, the holder may cross it generally or specially. Where a cheque is crossed generally, the holder may cross it specially. Where a cheque is crossed generally or specially, the holder may add the words 'not negotiable'. Where a cheque is crossed specially, the banker to whom it is crossed may cross it specially to another banker, his agent, for collection. Section 123 of the Negotiable Instruments Act refers to 'Cheque crossed generally'. Section 124 of the Act speaks of 'Cheque crossed specially'.

35. It is useful to refer to Section 31 of the Negotiable Instruments Act refers to 'Liability of drawee of cheque' which reads thus:

"The drawee of a cheque having sufficient funds of the drawer in his hands, properly applicable to the payment of such cheque must pay the cheque when duly required so to do, and, in default of such payment, must compensate the drawer for any loss or damage caused by such default."

36. In this connection, this Court points out that Section 118 of the Negotiable Instruments Act lays down a Special rule of evidence applicable to negotiable instruments. The presumption in law is that a Court shall presume, among other things, that the negotiable instrument or the endorsement has been made or endorsed for consideration. In short, the onus of proof of failure of consideration is on the maker of the note or the endorser. If a Defendant takes a plea, the burden is upon him/her to prove the same. If he/she fails to establish the said plea, the case of the Respondent/Plaintiff stands established. Mere payment by a cheque cannot be a prima facie evidence of advancing loan, for the reason that the cheque is construed to have been issued on consideration. But it is not an irrebuttable presumption of law. In law, it is open to a party/person to establish by other evidence that the cheque has been issued not to clear/wipe out the existing debt, but it is for the money lent.

37. At this juncture, this Court aptly points out the decision in Sher Singh V. Vijay Kumar and another AIR 1980 Punjab and Haryana 270 wherein it is held as follows: "Cheque only means and connotes that the drawer of the cheque has the same amount in his account in the Bank which can be credited in the account of the drawee and by presenting the cheque, the drawer does everything which is required of him to make the payment. The payment in cash or the payment through a cheque are at par. However, the result will not be the same if the drawer of the cheque does not have the amount of the cheque in his account or for any other reason, the cheque is dishonoured. In that case, the presentation of the cheque cannot be treated as the payment. However, barring such an eventuality, the payment of the decretal amount through cheque will be sufficient compliance of the provision of law."

38. The ingredients of Section 139 of the Negotiable Instruments Act cannot be dispensed with and the same is as follows: "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 S.138 for the discharge, in whole or in part, of any debt or other liability."

39. When a cheque is received by a Holder, a Court of Law is to presume that (a) it is a cheque of the kind mentioned in Section 138 of the Negotiable Instruments Act; (b) such a cheque has been received for the discharge of a legally enforceable debt or liability. The legislative presumption is that a Court of Law must proceed with an assumption that such a cheque has been received for the discharge of a legally enforceable debt or other liability until the drawer establishes that it is not so.

40. Also, this Court recalls the decision in Avon Organics Limited V. Poineer Products Limited and others 2004-Vol.119-Company Cases-18 : [2003 ALL MR (Cri) JOURNAL 105], it is held hereunder:

"There is a difference between issuing of post-dated cheques and cheques without putting the date. If the cheque is not drawn for a specified amount it does not fall under the definition of a bill of exchange. The cheque is a kind of bill of exchange, which means the amount payable must be mentioned in the cheque. Otherwise, it cannot be called a cheque within the meaning of Section 5 and Section 7 of the Negotiable Instruments Act, 1881. The person who accepts a blank cheque takes it along with the risks to be faced under law. It is not open to him to complain subsequently when the amount has not been realised. The presumption under Section 138 of the Act can be drawn in a case of issuance of blank cheque which is not denied by the drawer even though it was asserted by him that it was not issued with any dishonest intention. Whenever blank cheques are filled up and presented, a presumption can be drawn under Section 139 of the Act. It is a rebuttable presumption."

41. As far as the present case is concerned, though the Appellant/Defendant, in the Written Statement, has come out with a plea that it is complete lie on the part of the Respondent/Plaintiff to state that the Appellant/Defendant has received a loan amount of Rs.30,000/- from the Respondent/Plaintiff on 14.01.2002 for the purpose of commencing a jewellery business of her husband and for that she has issued a State Bank of India cheque and further, she has only received a sum of Rs.10,000/- as loan from the Respondent/ Plaintiff and for that purpose, she has issued an unfilled and not specifying the amount cheque to the Respondent/Plaintiff etc., are not proved to the subjective satisfaction of this Court.

42. A cursory perusal of Ex.A.1-Pronote dated 24.01.2002 shows that it is not a crossed one. Further, the Appellant/Defendant herself has written 'Rs.30,000/- ' in blue ink apart from writing the words 'Thirty thousand alone' in Tamil in her own handwriting. On bottom of Ex.A.1-Cheque, the Appellant/Defendant has affixed her signature. In Ex.A.1 in 'Pay to' column apart from the letter 'T', the name 'Natarajan' has been written in Tamil in different ink. In Ex.A.1, the date is specified as '24.01.2002'. Obviously, the date in Ex.A.1 and the writing of letter 'T' and 'Natarajan' in 'Pay to' column are of same blue ink. Likewise, the sum of 'Rs.30,000/-' and the words written in Tamil 'Thirty thousand alone' are in same ink. The sum of 'Rs.30,000/-' and the words in Tamil 'Thirty thousand alone' are written in the handwriting of Appellant/Defendant. In short, the signature of the Appellant/Defendant in Ex.A.1-Cheque dated 24.01.2002 tallies with her signature in the Written Statement, as seen by this Court through naked eyes [notwithstanding the fact that a Court of Law is empowered to compare the signatures as per Section 73 of the Indian Evidence Act though the said comparison can be unsafe at times since Court is not an expert witness]. Inasmuch as the Appellant/Defendant has put the words 'Thirty thousand alone' in Tamil in Ex.A.1 and further has written 'Rs.30,000/-' and has affixed her signature in bottom of the cheque-Ex.A.1, it is otiose for the Appellant/Defendant to contend or to take a categorical plea in the Written Statement in paragraph 3 to the effect that she has issued an unfilled cheque without specifying or mentioning the amount to the Respondent/Plaintiff in support of the purported loan of Rs.10,000/- received by her from the Respondent/Plaintiff.

43. It is not out of place for this Court, at this point of time, to pinpoint that the specific case of the Respondent/Plaintiff is that the Appellant/Defendant has received a loan amount of Rs.30,000/- in cash on 14.01.2002 from him and in support of the same, she has issued a State Bank of India, Turaiyur Branch Cheque dated 24.01.2002 (bearing No.357779) in his favour. Therefore, it is clear that the Respondent/Plaintiff is entitled to fill up the unfilled portion in Ex.A.1-Cheque like the payees name and the date and in the instant case, since Ex.A.1-Cheque shows the date as '24.01.2002' and further the Payee's name viz., the Respondent/ Plaintiff, the said document as the Bill of Exchange as per Section 6 of the Negotiable Instruments Act has become a cheque by means of the date being shown as 24.01.2002 and as such, the liability of the Appellant/Defendant who has allowed the Respondent/Plaintiff to take the incomplete instrument beyond a reach is to be strictly construed by imposing a liability on the Appellant/Defendant as per Section 20 of the Negotiable Instruments Act.

44. When the Appellant/Defendant has not proved her case that she received only a sum of Rs.10,000/- as loan from the Respondent/ Plaintiff, then the case of the Respondent/Plaintiff that the Appellant/ Defendant has received a loan of Rs.30,000/- in cash on 14.01.2002 for the purpose of her husband starting a jewellery business and has issued Ex.A.1-State Bank of India Cheque dated 24.01.2002 in his favour and further has spoken to by him as P.W.1 in his evidence is worthy of credence and the same is accepted by this Court. Viewed in that perspective, this Court holds that the Appellant/Defendant has received a sum of Rs.30,000/- from the Respondent/Plaintiff on 14.01.2002 and in support of the same, has issued Ex.A.1-Cheque dated 24.01.2002 for Rs.30,000/- to and in favour of the Respondent/ Plaintiff. In short, both the trial Court and the First Appellate Court are correct in applying the principles visualised as per Section 20 of the Negotiable Instruments Act in regard to Ex.A.1-Cheque dated 24.01.2002 and also placing the burden of proof regarding the consideration on the Appellant/Defendant and the Point Nos.1 and 3 are so answered against the Appellant/Defendant.

45. As regards the material alteration of Ex.A.1-Cheque dated 24.01.2002 viz., since the writings of the cheque are by different persons and therefore, it suffers from material alteration, it is to be pointed out that Section 87 of the Negotiable Instruments Act speaks of 'Effect of material alteration' and the same runs as follows: "Any material alteration of a negotiable instrument renders the same void as against any one who is a party thereto at the time of making such alteration and does not consent thereto unless it was made in order to carry out the common intention of the original parties."

46. Generally, any material alteration of a negotiable instrument renders the document void as against any one who is a party thereto, at the time of making the alteration and does not consent thereto, unless it is made in order to carry out the common object of the initial parties. In law, if a Payee enters/puts a date on a particular cheque, who is Holder of Cheque in Due Course, would not amount to material alteration rendering the instrument void as per decision in Bhaskaran V. Radhakrishnan, 1998 (2) Bank CLR 384 (Ker.)

47. In the present case on hand, the Appellant/Defendant has issued Ex.A.1-Cheque dated 24.01.2002 and the Respondent/Plaintiff as Payee has entered/put the date as '24.01.2002' and further, the Respondent/Plaintiff, in law, is the Holder in Due Course and as such, he is entitled to enter the date as well as his name as Payee and these will not amount to material alteration rendering the document/ instrument as a void one, in the considered opinion of this Court and as such, both the trial Court as well as the First Appellate Court are correct in arriving at a conclusion that Ex.A.1-Cheque is not affected by material alteration merely because some of the writings in the said document are by different persons and the Point No.2 is answered against the Appellant/Defendant.

48. Already, this Court has come to the conclusion that Ex.A.1-Cheque dated 24.01.2002 does not suffer from any material alteration and since Ex.A.1-Cheque has been issued by the Appellant/Defendant, it cannot be said by any means that the said document is a forged one. Moreover, in the instant case, Ex.A.1-Cheque dated 24.01.2002 has been dishonoured twice as per Exs.A.2 and A.5 due to insufficiency of funds and whenever the cheques are dishonoured due to insufficiency of funds, the ingredients of Section 138 of the Negotiable Instruments Act are attracted. Apart from the civil remedy, Section 138 of the Negotiable Instruments Act is intended to prevent dishonesty on the part of the drawer of a negotiable instrument to draw a cheque without sufficient funds in his account maintained by him/her in a bank and induces the Payee or Holder in Due Course to act upon it. As such, when once a cheque is drawn by an individual on an account maintained by her for payment of any sum or discharge of liability or debt and is returned by the bank with endorsement for the reason insufficiency of funds etc., it amounts to dishonour within the meaning of Section 138 of the Negotiable Instruments Act.

49. The ingredients of 138 of the Negotiable Instruments Act creates a strict liability, as opined by this Court. Whether to take recourse to a proceedings under Section 138 of the Negotiable Instruments Act or to file a civil suit by means of a civil remedy is within the choice of the affected person. Section 138 of the Act has specified a contractual violation as an offence and the legislative purpose is to promote efficacy of banking and to ensure that in commercial/contractual matters cheques are not dishonoured and credibility in transacting business through cheques is maintained as per decision of Hon'ble Supreme Court in NEPC Micon Limited V. Magma Leasing Limited 1999 Cri LJ 2883 (SC) : [1999(4) ALL MR 367 (S.C.) : 1999 ALL MR (Cri) 1837 (S.C.)]. Accordingly, the Point No.4 is answered against the Appellant/ Defendant.

50. In the result, the Second Appeal is dismissed, leaving the parties to bear their own costs. The Judgment and Decree of the First Appellate Court viz., the Principal Sub Judge, Trichirappalli dated 10.10.2006 in A.S.No.171 of 2004 are affirmed by this Court for the reasons assigned in this Appeal. Three months' time is granted to the Appellant/Defendant for making payment from the date of receipt of copy of this Judgment. Consequently, connected miscellaneous petition is closed.

Appeal dismissed.