Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2024 Supreme(Mad) 2443

IN THE HIGH COURT OF JUDICATURE AT MADRAS
SUNDER MOHAN, J.
Nandakumar - Appellant
Versus
M.Munirathnam - Respondent
Crl RC. No.381 of 2023
Decided on : 11-12-2024

Advocates:
Advocate Appeared:
For the Appellant : Mr.K.Pattabhi
For the Respondent: Mr.G.Balamanikandan, Mr.S.Udaya Kumar

A statutory presumption under the Negotiable Instruments Act is not rebutted if the accused fails to contest the evidence against them adequately; appellate courts cannot enhance sentences without proper grounds.

Headnote:(A) Negotiable Instruments Act, 1881 - Section 138 - Criminal Procedure Code, 1973 - Sections 255(2) and 386 - Loan default and bouncing of cheque - The petitioner was convicted for issuing a cheque for Rs.3,00,000/- which was returned for 'Funds Insufficient'. The trial court sentenced him to four months imprisonment, later enhanced to one year by the appellate court. The court found that the respondent established the cheque was issued for a legally enforceable debt, and the statutory presumption was not rebutted by the petitioner. However, the appellate court's enhancement of the sentence was deemed impermissible. (Paras 4, 5, 12, 16)

Facts of the case:
The petitioner borrowed Rs.3,00,000/- and issued a cheque which bounced. The trial court convicted the petitioner based on witness testimonies and evidence presented.

Findings of Court:
The appellate court's enhancement of sentence was set aside, and the fine was modified (Rs.3,75,000/- with default imprisonment).

Issues: Whether the appellate court can enhance the sentence without an appeal for enhancement; the establishment of enforceable debt.

Ratio Decidendi: Statutory presumption under Sections 118 and 139 was not rebutted. The appellate court's authority to enhance the sentence was limited by the provisions of the Cr.P.C.

Result: Criminal Revision Case partly allowed.

Table of Content
1. overview of the case and conviction details. (Para 1 , 2 , 3 , 4)
2. arguments related to capacity and evidence. (Para 6 , 7)
3. court analysis of evidence and presumption. (Para 8 , 9 , 10 , 11)
4. legal principles regarding sentencing powers. (Para 12 , 13 , 14)
5. modification of sentence and final ruling. (Para 16)
6. final decision on sentencing. (Para 17 , 18)

ORDER :

SUNDER MOHAN, J.

This Criminal Revision Case is filed challenging the judgment made in C.A.No.36 of 2019 dated 27.09.2022 on the file of the learned I Additional District and Sessions Judge, Tiruvallur, confirming the conviction and sentence passed in S.T.C.No.3 of 2018 dated 01.02.2019 on the file of the learned Judicial Magistrate, FTC, Tiruvallur.

2. The case of the 1^st respondent is that the petitioner had borrowed a hand loan of Rs.3,00,000/- in the month of September 2017 and towards repayment of the said loan, issued a cheque dated 09.11.2017 for a sum of Rs.3 Lakhs; that when the said cheque was presented for collection, it was returned unpaid with an endorsement, 'Funds Insufficient'; that inspite of statutory notice, the petitioner did not make the payment, but sent a reply making untenable averments.

3. The 1^st respondent had filed a complaint before the learned Judicial Magistrate, FTC, Tiruvallur, in S.T.C.No.3 of 2018 and had examined three witnesses as PW1 to PW3 and marked Ex.P1 to Ex.P7. The petitioner neither examined any witnesses nor marked any documents.

4. The trial Court held that the 1^st respondent had established that the cheque was issued by the petitioner for a legally enforceable debt. Hence, it convicted the petitioner and sentenced him to undergo four months simple imprisonment and to pay a fine of Rs.3 Lakhs. The appellate Court confirmed the finding of guilt rendered by the trial Court. However, the appellate Court had enhanced the punishment to one year simple imprisonment and directed the complainant to pay a sum of Rs.3 Lakhs with interest at the rate of 18% per annum from 09.11.2017 till the realisation of the amount and in default to undergo three months simple imprisonment. Hence, the revision.

5. Heard Mr.K.Pattabhi, learned counsel for the petitioner; Mr.G.Balamanikandan, learned counsel for the 1^st respondent; and Mr.S.Udaya Kumar, learned Government Advocate (Crl.Side) appearing for the 2^nd respondent/State.

6. The learned counsel for the petitioner submitted that the judgments of the Courts below are liable to be set aside for the following reasons:

(a) that the respondent had not established his capacity or the source of income to lend a huge sum of Rs.3 Lakhs as a hand loan; that therefore the statutory presumption cannot be drawn in favour of the respondent and relied upon the judgment of the Hon'ble Supreme Court in John K.Abraham v. Simon C. Abraham and another, reported in (2014) 2 SCC 236.

(b) that in the reply notice, the defence of the petitioner has been clearly spelt out and the complainant has not let in any evidence to counter the case of the petitioner that the cheque was given to one Panchatcharam as security for the loan obtained by the petitioner from the said Panchatcharam; and that the petitioner has issued a notice to the said Panchatharam for return of the said cheque along with other cheques after repayment of the loan to Panchatcharam.

(c) that the trial Court having tried the case summarily had erroneously sentenced the petitioner under Section 255(2) of the Cr.P.C., and therefore, the impugned judgments are liable to be set aside.

(d) that though the trial Court had sentenced the petitioner to four months simple imprisonment and directed to pay a compensation of Rs.3 Lakhs, the appellate Court had enhanced the sentence to one year simple imprisonment, which is contrary to the provisions of Cr.P.C., as enunciated by the Bombay High Court in Kesav son of Shantaram Kaole v. State of Maharastra, reported in 1990 Cri LJ 152

7. The learned counsel for the 1^st respondent per contra submitted that