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2005(1) Bankmann 276
KERALA HIGH COURT
K. Padmanabhan Nair, J.
Ramachandran — Appellant
versus
Dinesan — Respondent
Crl. R.P. No. 757 of 2003
Decided on 4.11.2004

Counsel for the Parties:
For the Petitioner:P.P. Rama-chandran & Sheji P. Abraham, Advocates.
For the Respondent: M. Ramesh Chander & Public Prosecutor (P.A. Raziya)

IMPORTANT POINT
Prosecution on a void cheque under Section 138 of Negotiable Instruments Act is not sustainable in law.

Headnote:(i) Negotiable Instruments Act, 1881—Section 87—Meaning of material alteration—Which is intentional, apparent and important—Cheque of Rs. 25,000/- altered to Rs. 1,25,000/- by addition of figure ‘’1’’ subsequently—Whether a material alteration? (Yes).

       Held: I have perused the disputed cheque. The word “1” appears to be added subsequent to the writing of the other figures. Even if the last figure “0” was also added subsequently, that does not make any difference. The complainant had no case that the corrections were effected with the knowledge and consent of the drawer. When the amount once written is corrected without the knowledge and consent of maker of the cheque, that amounts to material alteration.

        (Para 7)

       (ii) Negotiable Instruments Act, 1881—Section 87—Effect of material alteration in cheque—Without the consent of the party the effect of making such alteration bound is exactly the same as that of cancelling the deed—Section 138—Such cheque bounced—No prosecution is possible on such a cheque—Conviction set aside in revision—Case law referred.

       Held: When the document itself is a void one, it cannot be held that legally recoverable debt is due under that document. Since the explanation to Section 138 of the Negotiable Instruments Act defines the expression “debt or liability” unless it is established that the debt in question is a legally enforceable one it would not attract the consequence provided under the Section even if it is returned unpaid due to insufficiency of funds or the amount arranged to be paid from the drawer’s account by an agreement made with the Bank. Unless the conditions set out in Section 138 of the Negotiable Instruments Act are satisfied, no criminal liability can be fastened on the accused. So, if there is any material alteration in the cheque which renders it void, no criminal prosecution can be launched based on such a cheque. The Courts below had not considered this material aspect while holding that the revision petitioner is guilty of an offence under Section 138 of the Negotiable Instruments Act. Since the cheque itself is an invalid one, no prosecution is possible under such a document and the revision petitioner is entitled to an acquittal.

       In the result, the Criminal Revision Petition is allowed. The conviction and sentence imposed on the revision petitioner under Section 138 of the Negotiable Instruments Act are hereby set aside. He is found not guilty of the offence and acquitted. He is set at liberty. Fine, if any, paid shall be refunded to him. (Paras 11, 12)

       Result: Crl. Revision allowed.

Order

K. Padmanabhan Nair, J.—The revision petitioner was found guilty of an offence punishable under Section 138 of the Negotiable Instruments Act, convicted and sentenced to pay a fine of Rs. 35,000/- and in case of default of payment of fine, to undergo simple imprisonment for three months. He filed Crl. A. 122 of 1999 before the Sessions Court challenging the conviction and sentence. The learned Sessions Judge confirmed the conviction, but modified the sentence to that of a fine of Rs. 5,000/- and in default of payment of fine, to undergo simple imprisonment for three months. This Criminal Revision Petition is filed challenging the conviction and sentence imposed on the petitioner.

2. The first respondent filed a complaint against the revision petitioner alleging that he borrowed an amount of Rs. 1,25,000/- from him and when a demand for repayment of that amount was made, Ext. P1 cheque was issued. It was also alleged that when the cheque was presented for collection, the same was dishonoured for want of sufficient funds in the account maintained by the revision petitioner with the Bank. A notice demanding repayment of the amount covered by the cheque was issued. But, the revision petitioner did not pay the amount. Hence the complaint.

3. On the side of the complainant, P.W. 1 was examined. Exts.P1 to P9 proved and marked. After the prosecution evidence was over, the accused was questioned under Section 313 of the Code of Criminal Procedure. He denied all the allegations levelled against him. On the side of the accused, DWs. 1 and 2 were examined and Exts. D1 to D5 proved and marked. The learned Magistrate found the revision petitioner guilty of the offence alleged, convicted and sentenced him as aforesaid. In appeal the learned Sessions Judge confirmed the conviction, but reduced the sentence to that of a fine of Rs. 5,000/- and in default of payment of fine, to undergo simple imprisonment for three months. If the fine amount is paid or realized, an amount of Rs. 4,000/- was Ordered to be given to the complainant as compensation.

4. The learned counsel appearing for the revision petitioner has argued that there is material alteration in Ext. P1 cheque. It is contended that originally the figure written in the cheque was Rs. 25,000/- and the figure “1” was added subsequently. It is argued that both the Courts had concurrently found that there was correction in the figures. It is argued that correction of the figure written in a cheque subsequently without the knowledge of the drawer is a material alteration which makes the document void. It is argued that once the negotiable instrument is found to be void, it cannot be held that any legally recoverable debt is due from the maker of that document and hence the conviction and sentence imposed on the petitioner are illegal.

5. The main contention raised is that figure “1” was subsequently inserted in Ext. P1 cheque. The learned Magistrate himself had found that there was slight difference in the ink used for writing “1”, but it was found that if “1” was subsequently written, the last figure “0” was also subsequently written. Since the accused had no case that “0” was also subsequently added; the contention that there was material alteration in the cheque was rejected.

6. The learned Sessions Judge also found that there was reason to believe that the figure “1” was subsequently inserted before the other figures. The learned Sessions Judge found that ‘any way the accused having admitted that he had signed Ext. P1 cheque, he can succeed in the case only if he could prove his case otherwise’.

7. I have perused the disputed cheque. The word “1” appears to be added subsequent to the writing of the other figures. Even if the last figure “0” was also added subsequently, that does not make any difference. The complainant had no case that the corrections were effected with the knowledge and consent of the drawer. When the amount once written is corrected without the knowledge and consent of m


























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