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2002 Supreme(AP) 1433

Andhra Pradesh High Court
Judges : G.YETHIRAJULU
ANIL DAGWALE - Appellant
Versus
K.RAJU - Respondent
Decided On : 12-15-02

Headnote:

Negotiable instruments Act, 1881 - Section 138 - Criminal Procedure Code - Section 313 - Challenged - Acquitting - Evidence - Legality - Trial Court after considering oral and documentary evidence adduced by complainant came to conclusion that in view of Section 139 Act, unless drawer of cheque proves contrary it is to be presumed that cheques are issued in discharge legally enforceable liability as contemplated Section 138 of Act - In Upshur International Pvt. Ltd case this High Court observed thus if notice is issued to payee not to present cheque for encashment but cheque is presented and returned by bank on instructions of drawer section 138 does not get attracted - Whether a notice issued to payee before presentation of cheque or not is to be decided on evidence adduced in courts of trial - Held, In light of change in legal position and in view of specific finding of Supreme Court that drawer of a cheque issued in respect of a subsisting liability cannot get rid of penal consequences for dishonour of cheque by simply issuing instructions of stop payment to Bank or a notice to drawer not to present cheque - Suppose after cheque is issued to payee or to holder in due course and before it is presented for encashment notice is issued to him not to present same for encashment and yet payee or holder in due course presents cheque to Bank for payment and when it is returned on instruments Section 138 does not get attracted does not fit in with object and purpose for which above chapter has been brought on Statute book - Appeal allowed

G. YETHIRAJULU, J.

( 1 ) THE appellant-complainant being aggrieved by the judgment of the IV Metropolitan Magistrate Court, hyderabad acquitting the 1st respondent- accused in C. C. No. 617 of 1995 for the offence under Section 138 of the Negotiable instruments Act, 1881 ( the Act for brevity) has preferred this appeal challenging its validity and legality.

( 2 ) ACCORDING to the appellant- complainant, the 1st respondent took hand loans from him from January, 1995 to may 1995 to a tune of Rs. 75,000/- for the purpose of development of his business. On 1-6-1995 the 1st respondent in discharge of the above said oral debt issued three cheques dated 1-6-1995, 5-6-1995 and 8-6-1995 (Exs. P. 1 to P. 3) for Rs. 25,000/- each. The appellant presented those cheques to the Bank on 13-7-1995, but they were dishonoured by the bank on 14-7-1995 and a Cheque Return Memo was sent to him stating that the 1st respondent-accused closed his account. On 26-7-1995 the appellant issued a legal notice to the 1st respondent-accused calling upon him to pay the amount covered by the dishonoured cheques. The respondent-accused having received the notice on 31-7-1995 sent a reply denying the issuance of the cheques and failed to repay the amount. Hence the appellant approached the IV Metropolitan magistrate Court, Hyderabad by filing a complaint.

( 3 ) THE Trial Court took cognizance of the complaint under Section 138 of the Act, secured the presence of the accused, framed a charge under Section 138 and conducted the trial.

( 4 ) THE appellant-complainant in order to prove his case examined P. Ws. 1 to 3 and marked Exs. P. 1 to P. 10. The accused in his Section 313 Cr. P. C. examination denied the incriminating material placed by the complainant and reported no defence evidence, either oral or documentary.

( 5 ) THE trial Court after considering the oral and documentary evidence adduced by the complainant came to the conclusion that in view of Section 139 of the Act, unless the drawer of the cheque proves the contrary, it is to be presumed that the cheques are issued in discharge of the legally enforceable liability as contemplated under Section 138 of the Act. The Trial court further observed that the prosecution evidence established that on presentation of exs. P. 1 to P. 3 - cheques, they were dishonoured by the bank on the ground that the account run by the accused was closed and the accused failed to pay the amount covered by the dishonoured cheques, despite a legal notice. The Trial Court, however, found the accused not guilty under section 138 of the Act by following the judgments of the Madras High Court in mubarak Nishan v. R. N. Subratnanian, 1996 (2) ALT (Crl) 551 (Mad), Andhra Pradesh high Court in Upohar International Pvt. Ltd. and another v. State of A. P. and another, 1997 (1) ALD (Crl.) 30 and the Supreme court in Electronics Trade and Technology development Corporation Ltd, Secunderabad v. Indian Technologists and Engineers (Electronics) (P) Ltd. and another, (1996) 2 scc 739 and K. K. Sidharthan v. T. P. Praveena Chandran and another, 1997 (1)Crl. LJ 108 (SC ).

( 6 ) THE point for consideration is whether the complainant proved the guilt of the accused beyond reasonable doubt?

( 7 ) IN Mubarak Nishan (supra) the madras High Court held thus: despite notice, if drawee presents the cheques and get it dishonoured, there is no offence and Section 138 is not attracted

( 8 ) IN Upohar International Pvt. , Ltd case (supra) this High Court observed thus: if the notice is issued to the payee not to present the cheque for encashment, but the cheque is presented and returned by the bank on the instructions of the drawer, section 138 does not get attracted. Whether a notice issued to the payee before presentation of the cheque or not is to be decided on the evidence adduced in the courts of trial.

( 9 ) IN Indian Technologists and engineers (Electronics) (P) Ltd. , case (supra) the Supreme Court held thus: if a drawer of the cheque, before presentati










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