1. This appeal is preferred by the complainant, since he has lost his private complaint before the Lower Appellate Court, though succeeded before the Trial Court.

2. The fact involved in this case is that the disputed cheques marked as Exs.P7 and P8 claimed to be issued by the accused/respondent herein for discharging of legally enforceable debt. The Lower Appellate Court has arrived at a conclusion that though the cheques were issued for discharging the liability, due to subsequent agreement between the parties, the principle of novation has come to play and therefore, the drawer of the cheques is not liable to pay the cheques amount.

3. The short point for determination is whether the principle of novation is applicable to the facts of the case. The admitted facts are that the complainant company and the accused company were involved in the textile business and they had an arrangement between themselves for providing bill discount facility. So, whenever the accused company purchased the raw materials, those bills were discounted by the complainant company and funds were raised for the accused company. The bills discounted has to be repaid within a period of 90 days. While