has lost sight of the presumptions available to the
complainant under Section 118(g) of the N.I. Act which says
that until the contrary is proved, it shall be presumed that
the holder of a negotiable instrument is a holder in due
course. Here, admittedly, the complainant is the holder of
the cheque. According to the accused, Ext.P1 cheque was
issued by him to his elder brother DW2, while DW2 was an
inpatient in a hospital, and that the said cheque was stolen
away by the complainant. Even in such case, there is clear
admission from the part of the accused that the complainant
is the holder of the cheque. Over and above it, the
complainant could present the cheque before the Bank and
got it dishonoured. Therefore, when it is admitted that the
complainant is the holder of the cheque, the presumption
under Section 118(g) of the N.I.Act is available to the
complainant. It shall be presumed that the complainant
being the holder of the cheque is the holder in due course
within the meaning of Section 9 of the N.I. Act.
10. The learned counsel for the petitioner has invited
the attention of this Court to the decision in Michael
Kuruvilla v. Joseph J. Kondody[1998(1) KLT 384] wherein
it was held that the non-mentioning of the payee's name and
the striking off of the words 'or bearer' in a cash cheque will
not make the cheque invalid. It was held therein that even
in such case the person who was the holder of the cheque
could be a holder in due course, who could well maintain a
complaint under Section 142 of the N.I.Act.
11. Here, in this particular case, the position is much
better. The cheque is styled as a self cheque and over and
above it, the term 'or bearer' has not been scored off. A
similar situation as the one in this case was dealt with by the
Madhya Pradesh High Court in Babu Lal v. Kewal Chand
[2008(1) Crimes 147(MP)] wherein also it was held that such
a complainant who was holding such a cheque could be a
holder in due course, who could maintain a complainant
under Section 142 of the N.I. Act.
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
MR. JUSTICE B.KEMAL PASHA
15TH DAYOF JULY 2016
CRL.A.No. 1870 of 2009
SARAFUDHEEN, S/O.MOIDU,
Vs
T.MUHAMMED ASHRAF, S/O.MOIDU,
Citation:2016 ALLMR(CRI) JOURNAL573
Challenging the judgment of acquittal passed by the
Additional Sessions Court, Thalassery, in Crl.Appeal No.775
of 2003, the complainant in the matter has come up in
appeal. Crl.Appeal No.775 of 2003 of the court below was
filed by the accused in C.C.No.351 of 2003 of the Additional
Chief Judicial Magistrate's Court, Thalassery.
2. The case before the trial court is as a result of a
private complaint filed by the appellant herein as
complainant, against the 1st respondent herein as accused,
alleging an offence punishable under Section 138 of the
Negotiable Instruments Act. The complaint was filed through
PW-1, who was the power of attorney holder of the
complainant.
3. The case of the complainant is that the accused
borrowed an amount of 2,25,000/- from the complainant on
agreeing to repay the same within 6 months and when he
demanded the repayment, the accused issued Exhibit-P1
cheque dated 15.09.2000, which on presentation returned
dishonoured for insufficiency of funds in the accounts of the
accused. The complainant caused to issue demand notice
dated 09.12.2000 to the accused under Section 138(b) of
the Negotiable Instruments Act. The notice returned with the
endorsement, `out of India'.
4. The trial court recorded the evidence of PW-1 and
marked Exhibits- P1 to P5. On the side of the accused,
DW-1 and DW-2 were examined and Exhibits-D1 to D3 were
marked. DW-1 is the accused and DW-2 is the elder
brother of the accused.
5. It seems that a strange contention was taken by the
appellant with regard to Exhibit-P1 cheque. It was
contended that Exhibit-P1 cheque was issued by the
accused to his elder brother DW-2, when DW-2 was an
inpatient in a hospital, who was admitted for a surgery to his
lungs. It is contended that the said cheque was stolen away
by the complainant and after misusing it, the complaint was
filed. Apparently, the said contention is not believable. The
trial court found that the accused has committed the offence
under Section 138 of the Negotiable Instruments Act,
convicted him thereunder and sentenced him to undergo
simple imprisonment for six months and to pay a fine of
2,50,000/-, in default to undergo simple imprisonment for
three more months.
6. The matter was taken in appeal as aforesaid. The
appellate court, through the impugned judgment, held that
Exhibit-P1 is a `self cheque' and therefore the complainant
could not be treated as a holder in due course within the
meaning of Section 9 of the Negotiable Instruments Act and
therefore, the complaint as such is not maintainable.
7. The lower appellate court found that as per Section
142 of the Negotiable Instruments Act, the court could take
cognizance of an offence under Section 138 of the
Negotiable Instruments Act only on a complaint in writing
made by the payee or a holder in due course. On the said
reasoning and also by relying on a stray sentence in Exhibit-
D3 deposition, allegedly made by the complainant in
another case that 'there is no close acquaintance between
the complainant and the accused', the court below has
chosen to pass the judgment of acquittal.
8. This is a case wherein Ext.P1 cheque was issued
in the form of a "self cheque". At the same time, it is a
bearer cheque also, since the terms "or bearer" has not
been scored off. Therefore, Ext.P1 cheque could be treated
as a "bearer cheque". As per Section 9 of the N.I. Act,
"holder in due course" means "any person who for
consideration became the possessor of a promissory note,
bill of exchange or cheque if payable to bearer, ........."
Therefore, when Ext.P1 cheque is a "bearer cheque", the
possessor of the cheque for consideration can be termed as
a "holder in due course". The court below has lost sight of
the fact that Ext.P1 cheque could be treated as a "bearer
cheque".
9. Apart from the above, it seems that the court below
has lost sight of the presumptions available to the
complainant under Section 118(g) of the N.I. Act which says
that until the contrary is proved, it shall be presumed that
the holder of a negotiable instrument is a holder in due
course. Here, admittedly, the complainant is the holder of
the cheque. According to the accused, Ext.P1 cheque was
issued by him to his elder brother DW2, while DW2 was an
inpatient in a hospital, and that the said cheque was stolen
away by the complainant. Even in such case, there is clear
admission from the part of the accused that the complainant
is the holder of the cheque. Over and above it, the
complainant could present the cheque before the Bank and
got it dishonoured. Therefore, when it is admitted that the
complainant is the holder of the cheque, the presumption
under Section 118(g) of the N.I.Act is available to the
complainant. It shall be presumed that the complainant
being the holder of the cheque is the holder in due course
within the meaning of Section 9 of the N.I. Act.
10. The learned counsel for the petitioner has invited
the attention of this Court to the decision in Michael
Kuruvilla v. Joseph J. Kondody[1998(1) KLT 384] wherein
it was held that the non-mentioning of the payee's name and
the striking off of the words 'or bearer' in a cash cheque will
not make the cheque invalid. It was held therein that even
in such case the person who was the holder of the cheque
could be a holder in due course, who could well maintain a
complaint under Section 142 of the N.I.Act.
11. Here, in this particular case, the position is much
better. The cheque is styled as a self cheque and over and
above it, the term 'or bearer' has not been scored off. A
similar situation as the one in this case was dealt with by the
Madhya Pradesh High Court in Babu Lal v. Kewal Chand
[2008(1) Crimes 147(MP)] wherein also it was held that such
a complainant who was holding such a cheque could be a
holder in due course, who could maintain a complainant
under Section 142 of the N.I. Act.
12. From all the above, it has clearly come out that
the lower appellate court has committed a grave error in
passing the judgment of acquittal by reversing the judgment
passed by the trial court. The impugned judgment of the
lower appellate court is liable to be set aside and the
conviction entered by the trial court is only to be maintained.
Regarding the sentence, this Court is of the view that when
so much time has been elapsed, interest of justice demands
the reduction in sentence of imprisonment. This Court is of
the view that a sentence of imprisonment till the rising of the
court and to pay a fine of 25,000/-, in default, to undergo
simple imprisonment for six months, will meet the ends of
justice in this case.
In the result, this Appeal is allowed and the impugned
judgment of the lower appellate court is set aside. The
conviction passed by the trial court is maintained. The
sentence imposed by the trial court is modified as follows:
The accused is sentenced to undergo imprisonment
till the rising of the court and to pay a fine of 25,000/- within
three months from today, in default, to undergo simple
imprisonment for six more months.
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