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CHEQUE BOUNS CASE

On two grounds the lower court dismissed the complaint. one is on limitation another is on the point of inchaote cheque.Their lordships of Madras High court upheld the second count as correct and first count as wrong.3.The trial Court dismissed the complaint on the ground that the cheque issued was unfilled cheque and cannot be construed as negotiable instrument and the complaint is not taken cognizance within the period of limitation. Hence, this appeal by the complainant before this Court. At the outset, this Court is inclined to say that the grounds upon which the complaint is rejected by the trial Court is factually and legally unsustainable. Regarding the question of limitation, the same is well settled that the relevant date for computing the period of limitation is the date when the complaint is filed or criminal proceedings is initiated and not the date when the Court-Magistrate takes cognizance or issues process. CrPC imposes an obligation on the aggrieved party to take recourse to appropriate forum within the period provided by law and once he takes such action, it would be wholly unreasonable and inequitable if he is told that his grievance would not be ventilated as the court had not taken an action within the period of limitation. Such interpretation of law, instead of promoting justice would lead to perpetuate injustice and defeat the primary object of procedural law. 2. inchoate cheque =Regarding other aspect, Section 20 of Negotiable Instruments Act, deals with prima facie authority of the drawee of the cheque either wholly blank or incomplete to fill the same. For the purpose of appreciating Section 20 of Negotiable Instruments Act, is extracted as follows: “20.Inchoate stamped instruments: Where one person signs and delivers to another a paper stamped in accordance with the law relating to negotiable instruments then in force in India, and either wholly blank or having written thereon an incomplete negotiable instrument, he thereby gives prima facie authority to the holder thereof to make or complete, as the case may be, upon it a negotiable instrument, for any amount specified therein and not exceeding the amount covered by the stamp. The person so signing shall be liable upon such, instrument, in the capacity in which he signed the same, to any holder in due course for such amount. Provided that no person other than a holder in due course shall recover from the person delivering the instrument anything in excess of the amount intended by him to be paid thereunder. Our High Court has in identical circumstances in the judgment reported in 2004 (5) CTC 84 (P.S.A. Thamotharan v. Dalmia Cements (B) Ltd., Dalmiapuram) rejected the identical defence and held that it is not mandatory and no law prescribed that the body of the cheque should also be written by the signatory to the cheque and it could be filled up by anybody if it is signed by the account holder of the cheque, accepting the amount mentioned therein. In the case cited above also, the signature of the cheque was admitted by the accused and the plea raised by him was that body of the cheque was not written by the accused and he sought for comparison of the document in question and such contention was rejected by the trial Court. The High Court was also while affirming the same observed that the comparison of the hand writings, namely the body of the cheque as well as admitted hand writing of the petitioner, is not going to tilt the balance of the case in anybody’s favour and the entire case depends upon the liability and under what circumstance the cheque was issued. Here, in this Case also, if the evidence is looked into P.W.1 complainant has specifically stated that the cheque given to him was filled one and the same was not denied by the accused by getting into the witness box as such prima facie legal presumption to be drawn in favour of the complainant is that cheque produced herein is the cheque issued to him. As such the contrary finding of the trial Court and the rejection of the complaint on that ground cannot be allowed to stand.

IN THE HIGH COURT OF JUDICATURE AT MADRAS

An example of 2,000 cheque given to people

An example of 2,000 cheque given to people (Photo credit: Wikipedia)

DATED: 07.07.2011

CORAM:

THE HONOURABLE MS. JUSTICE K.B.K.VASUKI

Criminal Appeal No.1354 of 2004

N.Seerangan .. Appellant/Complainant

Vs.

V.V.Khalid Haji
(Mudariyil) .. Respondent/Accused
Prayer:Criminal Appeal filed under Section 378 Cr.P.C., against the judgment of acquittal dated 27.09.2004, made in C.C.No.104 of 2003, on the file of the Judicial Magistrate No.I, Sankari.

For Appellant : Mr.D.Shivakumaran
For Respondent : Mr.A.Joseph Dorairaj
No appearance
J U D G M E N T
The appeal is filed by the complainant challenging the dismissal of C.C.No.104/2003 filed against the respondent for prosecuting him for the offence under Section 138 of Negotiable Instruments Act.

2.The complaint proceeds as if the complainant is dealing in raw materials for manufacturing cement and the respondent/accused is owning cement factory and medical foundation and he is known to the complainant for more than 1 = years and by taking advantage of such acquaintance, the accused approached the complainant for getting hand loan and obtained Rs.1,30,000/- on 28.10.2002 and on the same day, issued postdated cheque dated 30.11.2002, for Rs.1,30,000/- for due repayment of the amount. The complainant did not at the request of the accused present the cheque for collection on 30.11.2002 and the complainant presented the cheque on 03.02.2003. The cheque was dishonored for want of sufficient funds and the same was intimated to the complainant on 15.02.2003 and the complainant through statutory notice intimated the accused on 24.02.2003 about the dishonoring of the cheque. The statutory notice sent through registered post was returned as unserved and the same sent through courier was received by the accused on 27.02.2003. But the accused till date of filing of the complaint neither sent any reply nor discharged his liability. The complainant inorder to prove the case as stated in the complaint examined himself and the Bank Officer through which cheque is presented for encashment as P.W.1 and P.W.2 and produced Exs.P1 to P14 documents and the accused in support of his defence examined one Johnson, Police Constable attached to Kammacheri Police station, Kerala as D.W.1 and produced Exs.A1 to A5 documents.

3.The trial Court dismissed the complaint on the ground that the cheque issued was unfilled cheque and cannot be construed as negotiable instrument and the complaint is not taken cognizance within the period of limitation. Hence, this appeal by the complainant before this Court.

4.The learned counsel for the appellant has seriously questioned the correctness and findings of the trial Court by duly relying upon Section 20 of the Negotiable Instruments Act and by relying upon the judgment of Apex Court and our High Court seriously questioned the correctness of findings of the trial Court, regarding the cheque in question as based on no evidence and the finding that the complaint is barred by limitation as against the well settled legal principles.

5.In spite of repeated adjournments, there is no representation made on behalf of the respondent either in person or through his counsel on record. Hence the matter is proceeded with basing on the argument adduced on the side of the learned counsel on record for the appellant.

6.At the outset, this Court is inclined to say that the grounds upon which the complaint is rejected by the trial Court is factually and legally unsustainable. Regarding the question of limitation, the same is well settled that the relevant date for computing the period of limitation is the date when the complaint is filed or criminal proceedings is initiated and not the date when the Court-Magistrate takes cognizance or issues process. It is held so by Apex Court in (Japani Sahoo v. Chandra Sekhar Mohanty) (2007) 7 SCC 394, after detailed analysis of earlier verdicts given by the Apex Court in the judgment referred to therein (i.e.)
(i) 2004 SCC (Crimes) 39 (Bharat Damodar Kale v. State of A.P. )
(ii)1978 SCC (crimes) 215 (Surinder Mohan Vikal v. Ascharaj Lal Chopra)
(iii)1997 SCC (Crimes) 415 (Rashmi Kumar v. Mahesh Kumar bhada)
(iv)2000 SCC (crimes) 125 (State of H.P. v. Tara Dutt) and by overruling the judgments reported in (2002) 1 Crimes 675 (Madras) Dhandapani v. State and 1983 Cri.L.J. 1748 (Madras) (Jagannathan v. State),
the Supreme Court has clearly observed that filing of complaint or initiation of criminal proceedings and taking cognizance for issuance of process are two different distinct and independent acts and has explained in detail, the difference between two and has at last by applying the doctrine of actus curiae neminem gravabit (an act of Court shall prejudice none ) laid down as follows:
“Held: For the purpose of computing the period of limitation under Section 468 Cr.P.C., the relevant date must be considered as the date of filing of complaint or initiating criminal proceedings and not the date of taking cognizance by a Magistrate or issuance of process by a Court.
The two things, namely, (1) filing of complaint or initiation of criminal proceedings; and (2) taking cognizance or issuing process are totally different, distinct and independent. So far as the complainant is concerned, as soon as he files a complaint in a competent court of law, he has done everything which is required to be done by him at the stage. Thereafter, it is for the Magistrate to consider the matter, to apply his mind and to take an appropriate decision of taking cognizance, issuing process or any other action which the law contemplates. The complainant has no control over those proceedings. Because of several reasons it may not be possible for the court or the Magistrate to issue process or take cognizance. But a complainant cannot be penalized for such delay on the part of the court nor can be non-suited because of failure or omission by the Magistrate in taking appropriate action under Cr.P.C. No criminal proceedings can be abruptly terminated when a complainant approaches the court well within the time prescribed by law. In such cases, the doctrine actus curiae neminem gravabit (an act of court shall prejudice none) would indeed apply. One of the first and highest duties of all courts is to take care that an act of court does no harm to suitors.
CrPC imposes an obligation on the aggrieved party to take recourse to appropriate forum within the period provided by law and once he takes such action, it would be wholly unreasonable and inequitable if he is told that his grievance would not be ventilated as the court had not taken an action within the period of limitation. Such interpretation of law, instead of promoting justice would lead to perpetuate injustice and defeat the primary object of procedural law.
The matter can be looked at from different angle also. Once it is accepted (and there is no dispute about it) that it is not within the domain of the complainant or prosecuting agency to take cognizance of an offence or to issue process and the only thing which the former can do is to file a complaint or initiate proceedings in accordance with law, if that action of initiation of proceedings has been taken within the period of limitation, the complainant is not responsible for any delay on the part of the Court or Magistrate in issuing process or taking congnizance of an offence. Now, if he is sought to be penalised because of the omission, default or inaction on the part of the court or Magistrate, the provision of law may have to be tested on the touchstone of Article 14 of the Constitution. It can possibly be urged that such a provision is totally arbitrary, irrational and unreasonable. It is settled law that a court of law would interpret a provision which would help sustaining the validity of law by applying the doctrine of reasonable construction rather than making it vulnerable and unconstitutional by adopting rule of litera legis. Connecting the provision of limitation in Section 468 CrPC with issuing of process or taking of cognizance by the court may make it unsustainable and ultra vires Article 14 of the Constitution.”

7.Regarding other aspect, Section 20 of Negotiable Instruments Act, deals with prima facie authority of the drawee of the cheque either wholly blank or incomplete to fill the same. For the purpose of appreciating Section 20 of Negotiable Instruments Act, is extracted as follows:
“20.Inchoate stamped instruments: Where one person signs and delivers to another a paper stamped in accordance with the law relating to negotiable instruments then in force in India, and either wholly blank or having written thereon an incomplete negotiable instrument, he thereby gives prima facie authority to the holder thereof to make or complete, as the case may be, upon it a negotiable instrument, for any amount specified therein and not exceeding the amount covered by the stamp. The person so signing shall be liable upon such, instrument, in the capacity in which he signed the same, to any holder in due course for such amount. Provided that no person other than a holder in due course shall recover from the person delivering the instrument anything in excess of the amount intended by him to be paid thereunder.

Our High Court has in identical circumstances in the judgment reported in 2004 (5) CTC 84 (P.S.A. Thamotharan v. Dalmia Cements (B) Ltd., Dalmiapuram) rejected the identical defence and held that it is not mandatory and no law prescribed that the body of the cheque should also be written by the signatory to the cheque and it could be filled up by anybody if it is signed by the account holder of the cheque, accepting the amount mentioned therein. In the case cited above also, the signature of the cheque was admitted by the accused and the plea raised by him was that body of the cheque was not written by the accused and he sought for comparison of the document in question and such contention was rejected by the trial Court. The High Court was also while affirming the same observed that the comparison of the hand writings, namely the body of the cheque as well as admitted hand writing of the petitioner, is not going to tilt the balance of the case in anybody’s favour and the entire case depends upon the liability and under what circumstance the cheque was issued. Here, in this Case also, if the evidence is looked into P.W.1 complainant has specifically stated that the cheque given to him was filled one and the same was not denied by the accused by getting into the witness box as such prima facie legal presumption to be drawn in favour of the complainant is that cheque produced herein is the cheque issued to him. As such the contrary finding of the trial Court and the rejection of the complaint on that ground cannot be allowed to stand. However, it will not automatically go to prove the case of the complainant. The admission of the signature only attracts the legal presumption that the cheque is issued to discharge existing legally enforceable liability between the complainant and the accused and it is for the accused to adduce rebuttal evidence to dislodge the presumption and the accused can be held to have discharged the burden through preponderance of probabilities, by raising doubt in the mind of the Court that the cheque is not issued in the manner as narrated in the complaint by relying upon the available materials and also by maintaining the right of silence available to him and the factors relied upon by him in this case is as follows.
8.In this case, the specific case of the complainant is that he is carrying on business in raw materials used for manufacturing cement and the accused is owning cement factory and medical foundation and running medical college. The complainant is residing in Sankari, Salem District, whereas the accused is a Keralite and permanent resident of Kerala. It is the further case of the complainant that the petition mentioned money transaction was not effected between the parties in the course of their business. But the accused received a sum of Rs.1,30,000/- as hand loan that too by taking advantage of his acquaintance with the complainant for nearly 1 = years prior to the date of money transaction. Such case is denied by the accused and the case suggested to P.W.1 in the course of his cross-examination on the side of the accused is that the cheque in question was issued to one Syed Mohammed, who was acquainted with one Hari nath and who handed over this cheque to the complainant. It is the further case of the accused that police complaint was also given in this regard in Kammacheri Police station, wherein enquiry was conducted and the accused had nothing to do with the complainant and he was on 28.10.2002, the date on which the amount was allegedly borrowed under treatment at Manalur Co-operative Ayurvedic Hospital.

9.The accused in support of such contention examined one Johnson, Police constable attached to Kammacheri Police station, Kerala State and produced Exs.D1 to D5. Ex.D1 is the summon issued to Syed Mohammed, Musthafa and Seerangan. Seerangan, is none other than the complainant herein. The complaint dated 14.05.2003 proceeds to state that the cheques are entrusted with Syed Mohammed to settle the liability of K.F.C. and K.S.I.D.C. and the same was misused by him without the knowledge and approval of the petitioner and the same was handed over to Seerangan. The complaint was received as petition and enquiry was held and Syed Mohammed appeared in the police station and agreed to settle the matter and the enquiry was thereafter closed. Ex.D4 is the letter given to police station by Syed Mohammed to the effect that cheque in question was entrusted to him by the accused. The defence so raised is also spoken by D.W.1 Police constable and the same leads to reasonable doubt in the mind of this Court about the genuineness of the transaction pleaded in the complaint.

10.When it is specific case of the complainant that the respondent is owning cement factory and medical foundation and running medical college, his further case that he came and approached the complainant, who is the resident in Salem District and who was only known to him 1 = years ago that too by way of hand loan appears to be unacceptable. The case of the complainant that the transaction was not arising out of business dealing, strengthens the serious doubt in the complainant’s theory and the same shifts the burden to the complainant to prove the money transaction in question by way of satisfactory records. But the complainant except examining himself as P.W.1 and producing the cheque in question and the copy of the notice has not produced any other record evidencing the transaction. Further, the evidence of P.W.1 in the course of his cross-examination would reveal that he knew nothing about the accused and his acquaintance with the complainant is not too close so as to lend huge sum of Rs.1,30,000/-. Though P.W.1 would further say that he had some sort of business dealing with the accused, no records at all is produced to prove the business relationship between the two. On the failure of the complainant to satisfactorily prove any sort of relationship or acquaintance either in business or in person between the two, further theory of the complainant that the accused belonging to Kerala State that too with sound business and financial background borrowed Rs.1,30,000/- as hand loan from him appears to be unimpressive.
11.Thus, In my considered view, the appellant has failed to prove the existence of legally enforceable liability between the complainant and the accused and on his failure to do so, the appellant is disentitled to get any relief in this appeal as such the order of the trial Court in rejecting the complaint is on different ground confirmed by this appellate Court.

12.In the result, the appeal stands dismissed.

kj

To

1.The Judicial Magistrate No.I
Sankari.

2.The Public Prosecutor
High Court, Madras.

3.The Record Keeper
Criminal Section, High Court,
Madras

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