Only account holder is liable for dishonour of cheque

JUDGMENT: The complainant, in C.C.No. 204 of 1997 on the file of the Judicial Magistrate No.VI, Coimbatore, having failed in his attempt to get a conviction against the respondent/accused, has come to the Court as appellant, seeking the same relief.

2. It is the case of appellant/complainant, that the accused/respondent along with another, had borrowed a sum of Rs.90,000 on 4.7.1994, that in order to discharge the said debt, he had issued a cheque dated 19.3.1997 for a sum of Rs.1,47,000, which includes interest, that when the cheque was tendered for collection, the same was returned with an endorsement “funds insufficient”, that even after the issue of mandatory notice, the accused failed to pay the cheque amount and in this view, since he had committed the offence under Sec.138 of the Negotiable Instruments Act, he should be dealt with accordingly.

3. The accused/respondent upon appearance appears to have not only denied the liability, but also the issuance of the cheque in favour of the complainant for the alleged discharge of liability.

4. The trial Court, after recording evidence, while scanning the same, came to the conclusion, that though the cheque was issued on behalf of Southern Biologicals, the non-inclusion of its owner is not fatal and that the complainant has failed to prove that the cheque was issued by the accused to discharge the liability. Thus concluding, the respondent/ accused was acquitted as per the judgment dated 12.11.1998, which is under challenge in this appeal.

5. Heard the learned counsel for the appellant, M.Sathiyanarayanan.

6. The learned counsel for the appellant would contend, that there are sufficient materials to prove not only the liability, but also to prove that the cheque in question was issued for the discharge of the same and therefore, the dismissal of the complaint, acquitting the accused is against evidence, warranting interference by this Court.

7. After hearing the submissions made by the learned counsel for the appellant, and by going through the documents as well as the reasonings assigned by the trial Court, I am unable to find any merit in the appeal and in fact for the reasons, which I am going to assign infra, though it may not be in conformity with the findings given by the trial Court, the appeal deserves only dismissal, confirming the acquittal of the respondent, though he is not represented by the counsel.

8. It is the case of the prosecution, that M/s. Southern Biologicals probably a proprietary concern, had borrowed a sum of Rs.90,000 from the complainant on 4.7.1994 and evidencing the same, a xerox copy of the promissory note is marked and no reason is assigned for not producing the original. In the absence of original, it is not known, how the xerox copy was admitted as secondary evidence. Only in order to discharge the liability said to have been incurred by the respondent under Ex.P-1, it is said that the cheque was issued on 19.3.1997, which is exhibited as Ex.P-2. Ex.P-2 cheque was drawn by M/s. Southern Biologicals, though the accused had signed in the cheque as mandate holder. Therefore, one thing is clear that the liability was incurred only by M/s.Southern Biologicals and therefore, the Proprietor of that company or firm must be held responsible. After all, the accused whether he is known as C.Subramanian or C.S.Manian, as the case may be, cannot be held personally responsible. Unfortunately, when this defence was raised by the accused before the trial Court, the trial Court has given a finding as if the non-joinder of M/s.Southern Biologicals will not affect the case of the prosecution. In this context, we have to see the provisions of the Negotiable Instruments Act (hereinafter called ‘the Act’).

9. Sec.138 of the Act is clear that the person liable to answer this penal provision is only the person, who had drawn the cheque, which could be seen from the opening words “where any cheque drawn by a person on an account maintained by him......” thereby indicating, the

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