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2025 Supreme(Ker) 1661
IN THE HIGH COURT OF KERALA AT ERNAKULAM
P.V. BALAKRISHNAN, J.
Elizabeth (Minimol) W/o Baby - Appellant
Versus
Jose P. Jacob S/o P.J. Chacko - Respondent
Crl. Rev. Pet. No. 1502 of 2016
Decided On : 28-05-2025
Advocate Appeared:
For the Appellants : J.R. Prem Navaz, P.T. Sheejish
For the Respondents: P.S. Appu, A.R. Nimod, T.C. Suresh Menon, Maya M.N.
A cheque issued for a time-barred debt constitutes a fresh acknowledgment of the debt, and the presumption of a legally enforceable debt arises when the cheque is admitted.
Headnote:
(A) Negotiable Instruments Act, 1881 - Section 138 - Dishonour of cheque - The accused was convicted for issuing a cheque for a time-barred debt, which was held to be a fresh acknowledgment of debt - The courts found the evidence of the complainant credible and the defense of the accused unsubstantiated. (Paras 1, 11, 12)
(B) Presumption under Section 139 - The court emphasized that the presumption of a legally enforceable debt arises when the cheque is admitted, and the burden shifts to the accused to rebut this presumption. (Paras 9, 10)
Facts of the case:
The accused entered into an agreement for sale with the complainant, received payments totaling Rs.2,47,500/-, but failed to execute the sale deed or return the money. A cheque issued for Rs.5 lakhs was dishonoured due to insufficient funds. (Paras 2, 4)
Findings of Court:
The trial and appellate courts found the accused guilty under Section 138, confirming the conviction and modifying the sentence to a fine of Rs.5 lakhs. (Paras 5, 12)
Issues: The main issues included whether the cheque was issued for a legally enforceable debt and the credibility of the evidence presented by both parties. (Paras 7, 11)
Ratio Decidendi: The court ruled that the cheque issued for a time-barred debt constitutes a fresh acknowledgment of the debt, and the accused failed to provide a credible defense to rebut the presumption of debt under Section 139. (Paras 11, 12)
Result: Revision petition dismissed.
ORDER :
1. The revision petitioner is the accused in S.T. No.78/2013 on the files of the Judicial First Class Magistrate Court-III, Kanjirappally. She stood trial for committing an offence punishable under Section 138 of the NI Act before the said court and was convicted and sentenced thereunder. The accused challenged the said conviction and sentence by filing Criminal Appeal No.91/2015 before the Additional Sessions Court-V, Kottayam and the said court by judgment dated 28.07.2016, confirmed the conviction and modified the sentence passed by the trial court.
2. The case of the complainant in brief is as follows:-
The accused, who is the owner of 8.25 cents of property comprised in Survey No.198/1-B of Mundakkayam Village, entered into an agreement for sale with the complainant for a total consideration of Rs.2,47,500/-, on 18.01.2007. At the time of execution of the agreement, the accused received Rs.1 lakh as an advance and subsequently, on 02.02.2007, received another Rs.1,47,500/-. The accused neither executed the sale deed nor returned the amount paid. After repeated requests and mediations, the accused agreed to pay the amount with interest and issued Ext.P1 cheque dated 15.10.2012 for an amount of Rs.5 lakhs, on 01.10.2012. When the cheque was presented for encashment, it got dishonoured for the reason that funds were insufficient. The statutory notice issued to the accused also did not evoke any response and hence, the complainant preferred the complaint against the accused.
3. In the trial court, from the side of the complainant, PW1 was examined and Exts.P1 to P7 documents were marked. When examined under Section 313 of Cr.PC, the accused denied all the incriminating circumstances brought against her in evidence and contended that she is innocent. The accused stated that she never entered into an agreement for sale with the complainant or has received the amounts as alleged by him. She had borrowed Rs.50,000/- from the complainant for interest through one Subair Hassan and at that time, as a security, had executed an agreement for sale with respect to 8.25 cents of property. Three blank signed cheques were also given by the accused to the complainant at that time. Later, on 02.02.2007, she borrowed another Rs.50,000/- from the complainant and at that time as security, was compelled to make an endorsement on the reverse side of the agreement for sale and also to execute a Power of Attorney in favour of the complainant for the purpose of transacting her property. She also stated that even though she paid substantial amounts to the complainant, the complainant did not return the documents including the cheque and misused one among them.
4. From the side of the accused, DW1 was examined and Ext.D1 document was marked. The trial court, on an appreciation of the evidence on record, found the accused guilty and convicted her under Section 138 of the NI Act. The accused was sentenced to undergo simple imprisonment till the rising of the court and to pay a fine of Rs.5 lakhs under Section 138 of the NI Act. In case of default, the accused was ordered to undergo simple imprisonment for a period of six months.
5. In the appeal preferred by the accused as Criminal Appeal No.91/2015 the conviction was upheld and the sentence was modified to one of payment of fine of Rs.5 lakhs, with a default clause.
6. Heard the learned counsel for the revision petitioner and the learned counsel appearing for the 1st respondent.
7. The learned counsel for the revision petitioner contended that the cheque, which was given as security at the time when the accused borrowed Rs.50,000/- from the complainant, has been misused in this case. He submitted that, on 18.01.2007, when the accused thus borrowed the amount, she was also forced to execute an agreement for sale with respect to her property. Subsequently, on 02.02.2007, when the accused again borrowed another Rs.50,000/- she was made to execute a Power of Attorney in favour of the complainant, authorisi
