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IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
V.R.K. KRUPA SAGAR, J.
Vunnam Ankaiah - Petitioner
Versus
M/s. Shriram City Union Finance Limited and Another - Respondents
Criminal Revision Case No. 446 of 2007
Decided On : 20-03-2023
NEGOTIABLE INSTRUMENTS ACT, 1881 - SECTION 138 - DISHONOR OF CHEQUE - CONVICTION AND SENTENCE - REVISION - MODIFICATION OF SENTENCE - FULL SATISFACTION OF DUES - FINE IMPOSED AS COMPENSATION - IMPRISONMENT IN DEFAULT OF PAYMENT OF FINE.
Fact of the Case:
The revision petitioner was convicted and sentenced for the offence under Section 138 of the Negotiable Instruments Act, 1881 (N.I. Act) for dishonoring four cheques issued to the complainant company as repayment of a consumer loan. The petitioner challenged the conviction and sentence, arguing that the transaction was civil in nature and could not be prosecuted as a criminal case, and that there was no debt outstanding to attract liability under Section 138 of the N.I. Act.
Finding of the Court:
The court found that the petitioner had given the cheques as a borrower towards repayments, and that they were dishonored as they exceeded the arrangements he had with the bank. Despite receiving notice, the petitioner did not choose to repay, thereby committing the offence under Section 138 of the N.I. Act. The court held that the presumption under Section 139 of the N.I. Act that the cheques were given towards discharge of debt/liability remained un-rebutted.
Issues: 1. Whether the judgments of the Courts below suffer from any illegality or irregularity or impropriety requiring interference? 2. Whether the transaction was civil in nature and could not be prosecuted as a criminal case? 3. Whether there was no debt outstanding to attract liability under Section 138 of the N.I. Act?
Ratio Decidendi: 1. The court found no infraction of procedure prescribed for trial of summons cases or procedure for hearing a criminal appeal. The petitioner was represented by counsel throughout the proceedings, was furnished with copies of documents, and was given opportunities to adduce evidence and submit arguments. 2. The court held that giving cheques and failure to repay despite their dishonor being notified is made an offence under Section 138 of the N.I. Act. In the present case, such instance occurred, and the petitioner's contention that there can be a civil case but not a criminal case is without merit. 3. The court found that the petitioner was a borrower and that the cheques were given towards discharge of debt/liability. The presumption under Section 139 of the N.I. Act remained un-rebutted.
Final Decision: The court allowed the revision petition in part, modifying the sentence imposed by the lower courts. The sentence of simple imprisonment for three months was set aside, and the fine of Rs. 11,662/- imposed by the trial court was to be considered as fine and paid as compensation to the complainant company. In default of payment of the fine, the petitioner was to undergo simple imprisonment for one month.
ORDER :
This Criminal Revision Case is filed under Section 397 and 401 Cr.P.C. challenging the guilt, conviction and sentence inflicted against the revision petitioner for the offence under Section 138 of the Negotiable Instruments Act 1881 (for short ‘N.I.Act 1881’).
2. On the complaint of Respondent No.1 herein this revision petitioner was prosecuted in C.C.No.461 of 2005 and after due trial, the learned II-Additional Judicial Magistrate of First Class, Ongole by a judgment dated 02.02.2006 found him guilty for the offence under Section 138 of N.I.Act and convicted him and sentenced him to undergo simple imprisonment for a period of three months and he was further directed to pay Rs.11,662/- as compensation to Respondent No.1 herein in terms of Section 357(3) Cr.P.C.
3. The convict assailed the said judgment in Criminal Appeal No.14 of 2006. After due hearing afforded to both sides learned V-Additional District & Sessions Judge (Fast Track Court) Ongole by a judgment dated 14.03.2007 dismissed the appeal and confirmed the judgment of the trial Court.
4. It is against those convicting judgments of both the Courts below, this revision is filed stating that evidence was improperly appreciated and the disputed transaction is of civil in nature and could not have been prosecuted as a criminal case and there was no debt outstanding so as to attract liability under Section 138 of N.I.Act. It is for these reasons revision petitioner sought for his acquittal by upsetting the judgments of the Courts below.
5. Appearing for Respondent No.1 the learned counsel submits that, facts established through evidence clearly made out a case under Section 138 of N.I.Act and both the Courts below properly appreciated the evidence and reached to proper conclusions.
6. Learned counsel for Respondent No.1/complainant further submitted that subsequent to the judgments of Courts below the present revision petitioner paid the entire amount and in that view of the matter it does not invite any punishment for revision petitioner.
7. Representing Respondent No.2/State the learned Special Assistant Public Prosecutor submits that the case be disposed of according to law.
8. By an Order dated 29-03-2007 in Crl.M.P.No.646 of 2007 this Court suspended the execution of substance sentence and released the revision petitioner on bail. Though the revision petitioner is represented by learned Counsel when this revision was filed, during the subsequent period though the matter was listed on several occasions there has been no representation for revision petitioner. In terms of Section 403 Cr.P.C it was recorded that revision petitioner had no arguments to submit.
9. The point that falls for consideration is:-
“Whether the judgments of the Courts below suffer from any illegality or irregularity or impropriety requiring interference?”
10. POINT:-
The grounds urged in the revision do not indicate any infraction of procedure prescribed for trial of summons cases or procedure for hearing a criminal appeal. All throughout the legal proceedings before the both Courts below revision petitioner was represented by learned counsel and he was furnished with copies of documents and he was informed of the accusations and his plea of not guilty was recorded and in his presence or in the presence of his learned counsel evidence was recorded and the witness was cross-examined by the defence and the incriminating material on record was confronted to the revision petitioner under Section 313 Cr.P.C. and his explanations were recorded and he was given opportunities to adduce any evidence in defence and he was given opportunity to submit arguments. Therefore, on procedure in a criminal case there is nothing in challenge in the revision.
11. The case against the revision petitioner is that M/s. Shriram City Union Finance Limited is an incorporated company and this revision petitioner applied for a consumer loan under Ex.P3 dated 26.09.2003 and the company duly granted the loan under Ex.P4 dated 26.09.
AI
Dishonor of cheques issued as repayment of a loan constitutes an offence under Section 138 of the Negotiable Instruments Act, 1881, and the presumption under Section 139 of the Act that the cheques w....
The court confirmed that the burden of proof shifts to the accused to rebut the statutory presumptions once the complainant establishes a prima facie case under the N.I. Act.
The judgment of a civil court finding that the cheques were not supported by valid consideration became relevant and binding on the criminal court, leading to the acquittal of the accused.
The presumption in favor of the complainant under the Negotiable Instruments Act governs cases of dishonored cheques, requiring robust evidence from the defense to overturn convictions.
The court upheld the conviction under Section 138 of the NI Act, emphasizing the burden of proof on the accused to rebut the presumption favoring the complainant.
The presumption of debt under the Negotiable Instruments Act favors the complainant, and the accused must rebut this presumption, which was not done in this case.
The presumption of liability under Section 139 of the N.I. Act requires the accused to rebut the presumption once the issuance of the cheque is established.
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