IN THE HIGH COURT OF KERALA
M. Sasidharan Nambiar, J.
S.A. Mamman, Sakthimangalam - Petitioner
Versus
C.P. Gopalan Achari, Thekke Chalayil Veedu - Respondent
Cri. A. No. 225 of 2002
Decided On : 29-06-2010
Appellant filed a complaint alleging that first respondent borrowed Rs. 22,690/- for the construction of his house and issued a cheque which was dishonoured. The court found that the cheque was issued in discharge of a time-barred debt and doubted the existence of consideration. The appellant contended that even a time-barred debt could be a valid consideration for issuance of a cheque. The court held that a promise can be made even in a case where limitation for recovery of the amount has already expired and that promise is in writing and such writing can also be in the form of a cheque. The court also found that the first respondent failed to rebut the presumption available under Section 139 of Negotiable Instruments Act. The order of acquittal was set aside and the first respondent was convicted and sentenced.
Fact of the Case:
The appellant alleged that the first respondent borrowed Rs. 22,690/- for the construction of his house and issued a cheque which was dishonoured. The court found that the cheque was issued in discharge of a time-barred debt and doubted the existence of consideration.
Finding of the Court:
The court found that the first respondent failed to rebut the presumption available under Section 139 of Negotiable Instruments Act. The order of acquittal was set aside and the first respondent was convicted and sentenced.
Issues: The issues revolved around the validity of the cheque issued in discharge of a time-barred debt and the existence of consideration for the cheque.
Ratio Decidendi: The court held that a promise can be made even in a case where limitation for recovery of the amount has already expired and that promise is in writing and such writing can also be in the form of a cheque. The first respondent failed to rebut the presumption available under Section 139 of Negotiable Instruments Act.
Final Decision: The order of acquittal was set aside and the first respondent was convicted and sentenced to imprisonment till rising of court and a compensation of Rs. 25,000/- to be paid to the appellant/complainant and in default, simple imprisonment for two months.
1. This appeal is filed challenging the order of acquittal passed by Judicial First Class Magistrate, Thiruvalla in C.C. No. 1049/1997. First respondent is the accused therein. Appellant filed a complaint alleging that first respondent borrowed Rs. 22,690/- on different occasions for the construction of his house and towards discharge of that amount, issued Exhibit P1 cheque dated 2.6.1997 for Rs. 22,690/-, drawn on Pulikeezhu Branch of Central Bank of India and the cheque, when presented for encashment, where the appellant is having an account. It was dishonoured for want of sufficient funds under Exhibit P3, which was intimated to the appellant under Exhibit P2. Appellant sent the original of Exhibit P4 notice demanding the amount covered by the dishonoured cheque. First respondent received it under Exhibit P6 and instead of paying the amount, he sent Exhibit P7 reply raising false contentions. First respondent thereby committed offence under Section 138 of Negotiable Instruments Act.
2. Learned Magistrate, after taking cognizance of the offence under Section 138 of Negotiable Instruments Act, issued summons to the first respondent. First respondent appeared and pleaded not guilty. Learned Magistrate examined the appellant as PW1 and his wife as PW2 and marked Exhibits P1 to P9. First respondent did not adduce any evidence.
3. Contentions raised at the time of cross-examination of PW1 were similar to the contentions raised in Exhibit P7 reply. According to the first respondent, Exhibit P1 cheque was not issued towards discharge of any amount borrowed or cost of materials used for the construction of the house for the first respondent and instead, the cheque was obtained from Deputy Superintendent of Police's Office, Thiruvalla by exercising duress and coercion and is, therefore, unenforceable in law.
4. Learned Magistrate, on the evidence, found that evidence of PWs 1 and 2 show that Rs. 22,690/- was not paid as cash to the first respondent and instead, the amount was the cost of materials used for the construction of the house for the first respondent and construction of the house was completed in 1986 and therefore, in 1997, when Exhibit P1 cheque was issued, the debt has already become barred and issuance of a cheque in discharge of a time barred debt and its dishonour will not attract an offence under Section 138 of Negotiable Instruments Act. Learned Magistrate also found that there is doubt even with regard to existence of a consideration for the cheque and in such circumstances, acquitted the first respondent.
5. Appellant would contend that courts below did not properly consider the evidence in the light of the settled legal position. Learned counsel argued that even, according to the first respondent, the house was constructed for him by the appellant and first respondent is only claiming that it was done free of cost as a charity and therefore, he is not liable to pay any amount. He would also contend that even if the cost of materials are calculated, the amount would only be Rs. 16,000/-. Though it was contended that cheque was obtained from Deputy Superintendent of Police's Office, Thiruvalla by exercising duress and coercion, there is no evidence to prove the same. Learned counsel would argue that even a time barred debt could be a valid consideration for issuance of a cheque, as, in that case, the cheque would amount to an agreement as provided under Section 25(3) of Contract Act. Relying on the Division Bench decision of this Court in Ramakrishnan v. Parthasaradhy (2003 (2) KLT 613), followed by the decisions of the learned single Judge in Gopinathan v. Sivadasan (2006 (4) KLT 779 and Ramakrishnan v. Gangadharan Nair (ILR 2006 (3) Kerala 657), learned counsel argued that finding of the learned Magistrate that as the cheque was issued for a time barred debt, there is no valid consideration is unsustainable. Learned counsel also pointed out that though it was contended by the first respondent that cheque w
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