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2022 Supreme(Online)(MAD) 25645

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 28.09.2022 CORAM:

THE HONOURABLE MR. JUSTICE G.K.ILANTHIRAIYAN Crl.A.No.358 of 2018 V.SarendraPrakash ... Appellant Vs.

C.V.Shanmugam ... Respondent PRAYER:

Criminal Appeal filed under Section 378 of Code of Criminal Procedure, to set aside the order of acquittal by a judgment dated 06.04.2017 made in Crl.A.No.141 of 2016 on the file of V Additional District and Sessions Judge at Coimbatore reversing the judgment dated 04.10.2016 made in CC.No.133 of 2013 on the file of Judicial Magistrate, Fast Track Court at Magisterial Level-II at Coimbatore by allowing the criminal appeal.

For Appellant : Mr.S.Mukunth for Mr.T.L.Thirumalaisamy For Respondent : Mr.R.Babu, for Mr.B.Kumarasamy

Judgement Key Points

Case Overview

  • Criminal appeal under Section 378 CrPC filed by V. Sarendra Prakash (appellant/de facto complainant) against C.V. Shanmugam (respondent/accused) to set aside acquittal order dated 06.04.2017 in Crl.A.No.141 of 2016 by V Additional District and Sessions Judge, Coimbatore, which reversed conviction dated 04.10.2016 in CC.No.133 of 2013 by Judicial Magistrate, Fast Track Court, Coimbatore. (!) (!)

Factual Background

  • On 02.08.2010, accused borrowed Rs.7,50,000/- from complainant for business, executed demand promissory note at 24% p.a. interest; Rs.10,50,000/- due as per accounts. (!)
  • Accused issued cheque No.253127 dated 02.08.2012 for Rs.10,50,000/- on ICICI Bank, Coimbatore; presented on 02.08.2012, dishonoured on 04.08.2012 for "Account Closed", intimated to complainant on 07.08.2012. (!)
  • Complainant issued legal notice dated 22.08.2012 demanding payment within 15 days; returned on 31.08.2012 as "Addressee left without instructions, so returned to sender"; accused's address: No.9B, Srinagar, B.K.Pudur, Kuniamuthur Post, Coimbatore 641 008. (!)

Trial Proceedings

  • Complainant examined PW1, marked Ex.P1 to Ex.P5 (including returned notice as Ex.P5); accused examined no witnesses, marked no documents. (!)
  • Trial court convicted accused under Section 138 NI Act, sentenced to 1 year SI and Rs.10,000/- fine. (!)

First Appellate Proceedings

  • Accused appealed, first appellate court allowed appeal, set aside conviction and acquitted accused. (!) (!)

Accused's Defences

  • Account closed, no liability under Section 138 NI Act. (!)
  • Error in legal notice address (98 instead of 9B). (!)
  • Cheque issued as security to third party (Thiyagu), no consideration from complainant, misused by complainant. (!)

Appellant's Arguments

  • First appellate court erred in faulting lack of additional witnesses beyond PW1. (!)
  • Returned cover (Ex.P5) showed sufficient service despite address error; postman received notice 23.08.2012, attempted delivery 6 times till 30.08.2012, "left without instruction" equals service. (!) (!)

High Court's Analysis on Notice Service

  • Notice sent 22.08.2012 by RPAD, returned 31.08.2012 as "left without instruction, so returned to sender". (!)
  • Notice (Ex.P4) correctly stated door No.9B, but postal cover wrongly stated No.98 Srinagar (omitted Kuniyamuthur Post); postman attempted service based on name/location, intimation 23.08.2012, door closed 24-28.08.2012 and 30.08.2012. (!) (!) (!)
  • No intimation delivered to accused; endorsement "left without instruction" shows accused left without informing postal authority, but postman did not deliver intimation or treat as served; no endorsement of delivery to addressee. (!) (!)
  • Appellant failed to examine postman to prove service. (!) (!)
  • Trial court summons served at correct door No.9B; improper notice address/cover defects mean no valid service, no cause of action under Section 138 NI Act. (!)

High Court Decision

  • First appellate court's acquittal proper; no infirmity. (!)
  • Criminal appeal dismissed. (!)

JUDGMENT

This criminal appeal is directed as against the order of acquittal by a judgment dated 06.04.2017 made in Crl.A.No.141 of 2016 on the file of V Additional District and Sessions Judge at Coimbatore reversing the judgment dated 04.10.2016 made in CC.No.133 of 2013 on the file of Judicial Magistrate, Fast Track Court at Magisterial Level-II at Coimbatore.

2. The appellant is the defacto complainant and the respondent is the accused. The appellant filed complaint for the offence punishable under Section 138 of NI Act. The appellant lodged complaint alleging that on 02.08.2010, the respondent borrowed a sum of Rs.7,50,000/- from the complainant for the business purpose and executed the demand promissory note promising to repay the same to the complainant or to his order with interest @ 24% p.a., that a sum of Rs.10,50,000/- remained due and payable by the accused to the complainant as per the account, that the accused had been a chronic and systematic defaulter in repayment of the loan availed, that the accused had issued the cheque bearing No.253127 dated 02.08.2012 for a sum of Rs.10,50,000/- drawn on ICICI Bank, Coimbatore Branch towards discharge of the said liability, that when the complainant presented the cheque through their bankers M/s.Indus Ind Bank Ltd., R.S.Puram, Coimbatore for collection on 02.08.2012, the cheque was dishonoured by the accused bankers for the reason “Account Closed”, that the same had been intimated to the complainant bankers vide memo dated 04.08.2012 who in turn had intimated the complainant on 07.08.2012, that immediately the complainant had caused the legal notice to the accused on 22.08.2012 demanding the payment of the cheque amount within 15 days from the receipt thereof, that the same had been returned on 31.08.2012 as “Addressee left without instructions, so returned to sender”, that the accused had issued the cheque knowing that he had no sufficient funds in his account to honour the cheque and had issued the cheque with ulterior motive to cheat the complainant, that the complainant had issued the notice within 30 days from the date of dishonour of the cheque and filed the complaint within one month after the expiry of 15 days grace period provided in the notice for payment, that the accused is residing at No.9B, Srinagar, B.K.Pudur, Kuniamuthur Post, Coimbatore 641 008 and demand notice served on the above address.

3. On the side of the appellant, examined PW1 and marked Ex.P1 to Ex.P5. On the side of the respondent, no one was examined and no documents were marked. On perusal of oral and material evidence placed before the trial court, the trial court convicted the respondent for the offence punishable under Section 138 of NI Act and sentenced him to undergo one year simple imprisonment with fine of Rs.10,000/-. Aggrieved by the same, the respondent filed appeal and the same was allowed and set aside the conviction imposed by the trial court, against which the present criminal appeal has been filed.

4. The learned counsel for the appellant submitted that the respondent had taken three grounds as his defence before the trial court: (i) The account already closed and as such, he is not liable to be punished for the offence under Section 138 of NI Act; (ii) There was error in the legal notice with regards to mentioning of address as 98 instead of 9B; (iii) He borrowed money from one Thiyagu and no consideration was passed for the issuance of cheque. The said cheque was handed over as security to the said Thiyagu and the same was misused by the appellant herein. He further submitted that the first appellate court erred in holding that the appellant failed to examine any other witnesses to prove the case except himself as PW1. The returned cover was marked as Ex.P5.

Accordingly, intimation was duly delivered to the respondent in respect of the notice issued by the appellant herein though the appellant wrongly mentioned the address as 98 instead of 9B with regards to door number of the res

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