Criminal Appeal No.500/2018

13th March 2020

Petitioner Counsel: Shri R.T. Anthony
Respondent Counsel: Shri V.B. Palorkar
Act Name: Negotiable Instruments Act, 1881

Section :
Section 138 Negotiable Instruments Act, 1881 Section 146 Negotiable Instruments Act, 1881

Cases Cited :
Para 4: R. V .E. Venkatachala Gounder Vs. Arulmigu Viswesaraswami and V. P. Temple and another, reported in AIR 2003 SC 4548
Para 4: M/s Mandvi Co-op Bank Ltd Vs. Nimesh B. Thakore, reported in AIR 2010 SC 1402
Para 4: Spenser David Vs. Virjin Mary, (Criminal Appeal (MD) No.196/2009
Para 4: Bipin Shantilal Panchal Vs. State of Gujarat, reported in 2001 AIR (SC) 1158
Paras 5, 10: Rajendra Kumar @ Rajesh Kumar Balkisan Agrawal Vs. State of Gujarat, reported in 2012(1) Crimes 500 (Guj.)

JUDGEMENT

There is a judgment of acquittal by the trial Court Magistrate in Summary Criminal Complaint Case No.20102/2015 on 15-12-2017. The present appellant is a complainant and the present respondent is the accused therein. There was prosecution for the offence under Section 138 of the Negotiable Instruments Act, 1881 (for short, ‘N.I. Act.’). The learned Magistrate has framed in all 5 points and the findings on all the points are in favour of the complainant. However, the trial Court Magistrate was pleased to acquit the accused and it is for the reason that the complainant could not prove ‘funds insufficient’ as a reason for dishonour. The correctness of the said finding and the judgment is challenged before this Court.

2. As the limited issue is involved, I have taken up this appeal for final hearing with the consent of both the learned Advocates.

3. The issue involved in this appeal is, whether on the basis of available evidence, the complainant has proved “reason for dishonour as funds insufficient”. According to the complainant, he has filed 3 cheque return memos. They are at Exhibits-16, 18 and 20. They are issued by the Federal Bank Limited, who is the collective banker. The complainant is having account in the said bank. I have perused those cheque return memos. It is a fact that those memos do not bear the seal of the bank and any signature. According to the complainant, in spite of these lacunae, those 3 memos have been proved. For that purpose, he relied upon the conduct of the accused during the trial. According to the complainant, when these memos were tendered, the accused has not objected for giving exhibits. This is one of the reasons quoted by the complainant. Another reason is the accused while cross examining the complainant has not challenged these memos. He has not pointed out any lacunae in the memos and even not given suggestion about the proof of reason for dishonour.

4. On the point of exhibiting the documents and taking objection, learned Advocate Shri Anthony for the appellant relied upon the following judgments :-
(a) R. V .E. Venkatachala Gounder vs Arulmigu Viswesaraswami and V. P. Temple and another, reported in AIR 2003 SC 4548.
(b) M/s Mandvi Co-op Bank Ltd vs Nimesh B. Thakore, reported in AIR 2010 SC 1402.
These two judgments were given in civil litigation. He has also relied upon some of the following judgments dealing with this issue arising out of criminal proceeding. They are as follows :-
(a) Spenser David vs Virjin Mary, (Criminal Appeal (MD) No.196/2009 of Madurai Bench of Madras High Court).
(b) Bipin Shantilal Panchal vs State of Gujarat, reported in 2001 AIR (SC) 1158.

5. As against this, learned Advocate Shri Palorkar for the respondent, supported the findings of the trial Court. According to him, the presumption under Section 146 of the N. I. Act cannot come to the rescue of the complainant. Because, the cheque return memos do not contain the official seal of the bank. According to him, mere exhibiting the document does not amount to its proof. He contended that even if the accused did not object, the status of the document cannot be upgraded and lacunae in it will remain as it is. He relied upon judgment in case of Rajendra Kumar @ Rajesh Kumar Balkisan Agrawal vs State of Gujarat, reported in 2012(1) Crimes 500 (Guj.).

Conclusions

6. It is true that Section 146 of the N.I. Act is included in N.I. Act for the purpose of facilitating early disposal of the case. It is also for the purpose of dispensing with the attendance of the bank witnesses. The presumption under Section 146 of the N.I. Act can be drawn, if certain formalities are completed. One is the bank slip should contain the official mark denoting that the cheque has been dishonoured. This presumption is rebuttable presumption. The accused is at liberty to prove to the contrary. The trial Court more specifically in paragraphs 19, 20 and 21 has dealt with this issue. The trial Court has laid emphasis on absence of drawing presumption under Section 146 of the N.I. Act. The trial Court has also emphasized on failure of the complainant to examine the bank witnesses.

7. It is true that Section 146 of the N.I.Act contains a special provision. But, what I find is that the complainant wants to rely more on the conduct of the accused than this presumption. I have perused the additional affidavit as well as cross examination. On 07-10-2016, additional affidavit was recorded. The cheques as well as relevant cheque return memos were exhibited. It is very well true that at that time the accused has not objected. I have also perused the cross examination. Learned Advocate Shri Anthony for the appellant brought to my notice certain answers given by the complainant. The complainant deposes that “he has intimated the accused about bouncing of cheque on telephone”. But I did not find anywhere in the evidence that the accused has pointed out the lacunae in those memos. That is to say it does not bear the seal or signature of the banker. Even I do not find any suggestion given that the complainant has not proved the reason for dishonour of cheques. Here I find there is some lapse on the part of the accused.

8. It is true that the trial under Section 138 of the N.I.Act is quasi criminal only. So I do not find any objection in considering the ratio laid down by the Hon’ble Apex Court in two above referred judgments. In both these judgments the Hon’ble Apex Court has categorized the types of objection. One is about inadmissibility of documents and second is about how to prove the documents. The Hon’ble Apex Court has also opined what will be the consequences if objection is not taken at proper time and under which contingency it can be taken later on. If there is objection about inadmissibility of documents, the party is at liberty to take such objection in that particular stage. The Hon’ble Apex Court has observed that this cannot be the situation wherein objection pertained to mode of proof. Hon’ble Apex Court insisted that objection about mode of proof has to be taken at that juncture only. It is true that there are two consequences for not taking objection at that juncture. One is to prohibit the person from taking objection at subsequent stage. Other is the party releived upon that documents is releived from taking further steps to prove that document. I think the ratio laid down in these judgments are applicable to the facts of this case.

9. It is very well true that while not taking the objection at least on two occasions as referred above, the accused has relieved the complainant from proving those memos in other way. The issue does not rest there. The accused contends that even if he has not taken objection, the lacunae in those documents will remain as it is and they are aptly legible on looking at them. Those lacunae are; not bearing the seal and signature of the banker. I think the accused is right in the said submission.

10. The trial Court has relied upon the judgment given by the Gujarat High Court in case of Rajendra Kumar (supra). Both the learned Advocates have assisted me while reading the observations therein. It is true that in paragraph 14 of the said judgment while affirming the findings of the trial Court, Gujarat High Court has observed that “the memo produced on record by the original complainant does not bear stamp of any bank and therefore as per Section 146 of the N. I. Act, the said documentary evidence cannot be considered.

11. However, after reading the said judgment, it is difficult to ascertain, what were the foundational facts on which the trial Court has given that finding and which is subsequently affirmed by the Gujarat High Court? What I feel is that the trial Court without considering the background in which the Gujarat High Court has given that finding, mechanically applied the ratio to the facts before him.

12. In view of the above discussion what I feel is, that the complainant is aware that the memos does not bear the seal and signature of the banker. Knowingly he has produced those memos. It was his bounden duty to see that the documents on which he relies satisfy the requirement for proving the documents. Mere having the name of the bank printed on those memos will not relieve the complainant from his responsibility. In view of above, I find that the complainant has failed. At the same time I find, that the accused has also failed in challenging that document. So, what I feel is, that in the interest of justice the complainant needs to be given an opportunity to lead evidence on this aspect.

13. The learned Advocate Shri Anthony for the appellant submitted that there is no prayer to that effect in the appeal memo. However, that do not debar the Court from passing any order. The matter needs to be remanded to the trial Court only for the purpose of permitting the complainant to record evidence on the point of proof of cheque return memos. This Court has not opined on rest of the findings. They have been kept in tact. So, it will be better to direct both the parties to appear before the learned Magistrate and the learned Magistrate can give an opportunity to lead evidence on that aspect to both the parties. After that even if the accused wants to give evidence he is at liberty to lead the same. But, it is made clear, that this additional evidence, if any, be adduced only on the point of proof of cheque return memos. Hence, the following order is passed :-
ORDER
(a) The appeal is partly allowed.
(b) The matter is remanded back to the 30th Judicial Magistrate First Class and Special Court under Section 138 of the Negotiable Instruments Act, Nagpur.
(c) Both the parties are directed to appear before the 30th Judicial Magistrate First Class and Special Court under Section 138 of the Negotiable Instruments Act, Nagpur, on 27-03-2020.
(d) The complainant is permitted to adduce additional evidence only to prove the cheque return memos.
(e) The accused is at liberty to give rebuttal evidence if he wants.
(f) All this exercise be done within a period of 3 months.
(g) After the evidence is recorded, the trial Court is at liberty to decide the matter on the basis of that evidence.