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2005(1) Bankmann 170
MADRAS HIGH COURT
A. Packiaraj, J.
R.S. Raman — Appellant
versus
Trushar J. Seth — Respondent
Crl. R.C. No. 2106 of 2002
Decided on 6.3.2004
Held: Though factually, the Courts did not accept these contentions, but they held that in order to convict a person under Sec. 138, Negotiable Instruments Act, the cheque must have been returned for want of sufficient funds in the bank. But here in the present case, the cheque had been returned for the reason that the account had already been closed not at the instance of the accused but suo motu by the officials.
However, ultimately the Courts have come to the conclusion that the offence under Section 138 has not been made out since P.W. 2 bank official would state that the account of the petitioner was closed on 11.3.1998. (Paras 7 & 8)
(ii) Indian Penal Code, 1860—Section 417—Negotiable Instruments Act, 1881—Section 138—Dishonour of cheque—No offence under Section 138 Negotiable Instruments Act made out—Charge under Section 415 IPC neither made nor ingredients of delivery of property or any inducement fulfilled—Conviction under Section set aside.
Held: In the present case, when the Magistrate has thought it fit that he should convict him under Section 417, Indian Penal Code, he ought to have given sufficient notice to the accused to answer the said substance. But he has not done so. Conviction has necessarily to be set aside on that account. (Para 10)
I fully agree with the contention of the learned counsel for the petitioner and I see that at the time of issuance of the cheque, none of the first two ingredients are there and in respect of the third ingredient, if there had been some evidence from P.W. 1 that he did not do a particular thing because of the cheque having been given, it would have been a different matter. I hold that the offence under Section 415, Indian Penal Code has not been made out and consequently, he cannot be convicted under Section 417 Indian Penal Code either. (Para 17)
Result: Appeal dismissed.
A. Packiaraj, J.—The petitioner has been convicted under Section 417, Indian Penal Code and sentenced to undergo three months simple imprisonment and to pay a compensation of Rs. 1,50,000/- by the Judicial Magistrate No. V, Coimbatore in C.C.No.241 of 1999, against which, he preferred an appeal in C.A. No. 88 of 2001 before the II Additional Sessions Judge, Coimbatore, who confirmed the conviction and dismissed the appeal.
2. A complaint had been filed by the respondent against the accused for an offence under Section 138, Negotiable Instruments Act and the Magistrate also took cognizance of the same for an offence under Section 138, Negotiable Instruments Act and had read over the substance of the complaint to the accused whether he has committed an offence under Section 138, Negotiable Instruments Act for which he had denied. But surprisingly, the Magistrate has convicted him under Section 417, Indian Penal Code.
3. The averments in the complaint and the evidence of the complainant is to the effect that he being the proprietor of Artee Foams, the petitioner (accused) was doing a hotel business and as such, he borrowed a sum of Rs. 1,50,000/- on various dates. The petitioner agreed to pay the amount back with interest at the rate of 30% per annum and executed a promissory note. Despite several demands, the accused did not pay either the principal or the interest. Then on 12.5.1999, he is alleged to have given a cheque for Rs. 2,04,000/- drawn on Nedungadi Bank for the discharge of the amount. The complainant presented a cheque on 14.5.1999 through South Indian Bank, Gandhi Puram Branch and the same was returned on the ground of account closed. A lawyer’s notice as contemplated under the Act was issued on 22.5.1998 to the accused calling upon him to pay the cheque amount. The accused had received the notice on 28.5.1999 but sent a reply on 4.6.1999 denying the averments and he also did not pay the cash. Hence, the prosecution was launched.
4. To support the case of P.W. 1, P.W. 2 and P.W. 3 Managers of Nedungadi Bank and South Indian Bank were examined to speak about the dishonour of the cheque. The evidence of P.W.2, Manager of Nedungadi Bank is to the effect that the account was closed suo motu by the management as early as 11.3.1998.
5. The case of the accused is that he does not know the complainant at all. He had not borrowed any amount from him. One Sivanandam, who was formerly employed under the accused was terminated by him and that he assisted the accused in his business. He used to attend payment of income tax and sales tax on behalf of the accused. And when he left his services, he took about 25 signed cheques and 10 signed promissory notes with him. He has also taken with him Rs. 10 stamp papers with the signature of the accused. One of the cheques allegedly taken by Sivanandam had been used in this case. Therefore, he had also sent a notice to Sivanandam and he had received a reply from him, marked as Ex. D-3, wherein the said Sivanandam had admitted to have taken the cheques and promised to return the cheques, with the salary of the accused.
6. Then again the accused also took a plea of alibi stating that on 23.4.1998 he was admitted in K.G. Hospital on the complaint of chest pain and he was there till 1.5.1998. D.W. 1 Doctor attached to the said hospital had been examined to establish the same. The discharge summary has been marked as Ex.D-1. On 30.4.1998, he was subjected to echo-cardiograph test and the report is Ex.D-2. Therefore, according to the accused, he could not have been in a position to borrow the amount on 30.4.1998.
7. Though factually, the Courts did not accept these contentions, but they held that in Order to convict a person under Sec. 138, Negotiable Instruments Act, the cheque must have been returned for want of sufficient funds in the bank. But here in the present case, the cheque had been returned for the reason that the account had already been closed not at the instance of the accuse
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