cheque bounce case - Stop Payment - Unclaimed Statutory notice - not save the skin of the accused - when presented returned dishonoured even outcome of stop payment, it is within the meaning of the provisions of the Act and even after dishonour when statutory notice issued for any dispute of not served when shows unclaimed from the presumption under Section 27 General Clauses Act of due service available therefrom it is of deemed service - there is no oath against oath and there is no evidence in rebuttal and Exs.P10 and P11 with reference to Ex.P1 not in dispute, the Courts below are right in finding the accused guilty and for this Court while sitting in revision against that concurrent finding of guilt concerned there is nothing to interfere.

HONBLE DR. JUSTICE B. SIVA SANKARA RAO        

CRIMINAL REVISION CASE No.2887 of 2015    

18-04-2017

M. Mohan Rao Petitioner    

Bheemshetty Sreedhar and another.Respondents    


Counsel for the petitioner: Sri T. Pradyumna Kumar Reddy

Counsel for the respondents:Sri D.V. Reddy for 1st respondent
                              Learned Public Prosecutor for State

<GIST:
       
>HEAD NOTE:  


? Cases referred
1.      2001 Crl.L.J. 4745
2.      (2015) 9 SCC 622
3.      (2012) 1 SCC 260
4.      (2014) 16 SCC 32
5.      (1990) 2 SCC 385
6.      (1977) 3 SCC 25
7.      (1990) 4 SCC 718
8.      2010 (5) SCC 663
9.      2013 (16) SCC 465
10.     (2007) 6 SCC 555

HONBLE DR. JUSTICE B. SIVA SANKARA RAO        
Crl.R.C.M.P.Nos.1708 & 1709 of 2016
IN/AND
CRIMINAL REVISION CASE No.2887 of 2015    
ORDER:
      The revision petitioner is the sole accused in C.C.No.216 of
2012 on the file of Special Magistrate V, Hyderabad, which is for
the offence under Section 138 of the Negotiable Instruments Act
(for short the Act) and taken cognizance from the private
complaint of the revision 1st respondent-complainant based on
Ex.P11-cheque bearing No.601175 dated 05.12.2011 for
Rs.5,00,000/- which is claimed towards the part payment of out of
the total amount of Rs.35,00,000/- based on memorandum of
understanding-cum-deed of compromise dated 03.02.2011 under  
Ex.P10, which is outcome of contract for sale-cum-GPA dated
07.04.2011 Ex.P1 in relation to the property covered by original of
Ex.P3-sale deed dated 02.12.2010.
      2. The factual background show the complainant entered
into said sale agreement-GPA with 4 persons viz., Smt. R.Rani,
N.R. Nareder, N.R. Ravinder and S.Dhanalaxmi in relation to open
plot of 272 square yards in survey Nos.39 & 40, Kakaguda Village
of Secunderabad and for consideration of Rs.35,00,000/- and on
came to know of said property already sold by the said vendors
collusively to the accused under original sale deed supra, the
complainant demanded for refund of the amount from all including
the accused and on their refusal, there was a criminal case for the
offence of cheating and criminal breach of trust and also police
registered the crime and pending crime, there was a compromise
whereunder the accused promised to pay Rs.35,00,000/- for final
settlement of the amount due to the complainant vide the MOU-
compromise deed dated 03.12.2011 supra and issued the Ex.P11-  
cheque in question and when presented the same was returned
dishonoured on the ground of stop payment, on 08.12.2011 and
from the statutory legal notice sent to the accused returned as
unclaimed from the accrual of cause of action filed the complaint.
      3. After sworn statement recorded, the learned Magistrate
has taken cognizance for the offence by taken case on file and after
supply of copies and from examination of accused and on his
denial of the accusation put to trial.  In the course of trial, the
complainant came to the witness box as PW.1 and placed reliance
on 22 documents including those materially relevant referred
supra.  From said evidence and after hearing both sides, the trial
Court held that the cheque is routed from the account
undisputedly and it is in settlement of the amount due for the sale
agreement outcome of compromise and settlement, which is within
the meaning of legally enforceable debt and the burden is on the
accused also to rebut the presumptions and still to say how not
liable by also referring to the expression of the Apex Court in
K.N.Beena Vs. Muniyappan  and found him guilty for the offence
and after hearing, sentenced to undergo six months rigorous
imprisonment with payment of fine Rs.10,000/- with default
sentence of 3 months saying out of said fine amount of Rs.9,000/-
as compensation payable to the complainant.
      4. Against said conviction judgment dated 12.03.2014, the
accused preferred Crl.A.No.291 of 2014 and the learned
Metropolitan Sessions Judge as FAC I Additional Metropolitan
Sessions Judge vide judgment dated 23.12.2015 dismissed the
appeal confirming the trial Courts conviction judgment and also
the sentence of imprisonment with fine by repelling the several of
the contentions raised by the accused/appellant in the grounds of
appeal.
      5. It is impugning the same, the present revision is filed with
the contentions that the Ex.P10-MOU shows the complainant can
retain the property if consideration of Rs.35,00,000/- is not paid
and the Ex.P11 was issued on condition of the complainant will
withdraw the civil suit and according to MOU-Ex.P10 any dispute
will be settled amicably and the cheque case is not sustainable and
the amount covered by the statutory notice is not for the cheque
amount but the entire amount, notice is also not legally
sustainable and thereby the conviction judgment with concurrent
finding is unsustainable and accused is entitled to be acquitted by
allowing the revision.
      6. Pending revision, there was interim suspension of the
conviction judgment subject to executing a bond with sureties and
the complainant-R.1 to the revision sought for vacating the interim
orders of suspension and also filed application to dismiss the
revision and also to enhance the sentence of imprisonment with
fine and further to award compensation of Rs.5,00,000/- against
the accused in favour of the complainant vide
Crl.R.C.M.P.Nos.1708 & 1709 of 2016.
      7. Heard the learned counsel for the revision
petitioner/accused and also the learned counsel for the revision
1st respondent respectively at length and perused the material on
record.
      8. In so far as compensation and enhancement of sentence
concerned, the complainant placed reliance on the expression of
the Apex Court in Mainuddin Abdul Sattar Shaikh Vs. Vijay D.
Salvi  particularly from Paras 14 & 15 saying dishonour of cheque
for Rs.74,200/- the sentence of accused to undergo simple
imprisonment of 5 months and compensation of twice the cheque
amount is awarded therein by referring to R. Vijayan Vs. Baby
saying the provisions of the Act strongly lean towards grant of
reimbursement of the loss suffered by complainant by
compensation and the Courts should unless there are special
circumstances uniformly exercise power to levy fine up to twice the
amount of cheque keeping in view the cheque amount and the
simple interest @ 9% p.a. as a reasonable quantum of loss and
direct payment of such amount as compensation by way of
restitution in regard to loss on account of dishonor of cheque in a
practical and realistic way as a reasonable one, to say it is not only
ordering payment of cheque amount but also interest at such rate
thereon not only increase credibility of cheque as a negotiable
instrument but also credibility of Courts of Justice.  Needless to
say with default sentence for non-payment of said cheque amount
with interest.  The expression says it is not the imprisonment but
mainly payment of the cheque amount with interest to compensate
the complainant.  The other expression placed reliance is S.R.
Sunil & Company Vs. D.Srinivasavaradan  the Apex Court held
for the cheque amount of Rs.5,38,425/- which is in the interest
component for the borrowal amount ordered to pay concerned as
fine with default sentence saying undisputedly the principal
amount paid by the accused but the interest component for the
cheque pending for the last 15 years without realization, thereby
held the sentence no way called for interference where learned
Magistrate imposed till rising of the day and payment of the
amount.  The other judgment placed reliance is Sahab Singh and
Others Vs. State of Haryana  it says the High Court got even suo
motu revision powers to enhance the sentence in exercise of such
revision powers even in the appeal against conviction maintained
by the accused and even no appeal against sentence filed by State
and such power is there from the reading of the provisions under
Sections 397, 401, 374, 377 & 386 Cr.P.C.  In fact coming to the
Section 401 Cr.P.C., there is a specific bar under Section 401
clause (3) Cr.P.C. of if it is against acquittal, the revision Court has
no power to impose sentence, but for if at all to remand.  The
wording in this Section is that the High Court cannot convert the
acquittal into conviction.
      9. No doubt the case in Sahab Singh supra and also the case
on hand are not against acquittal, but by accused against
conviction and the complainant represented by State in a police
case even not maintained in revision what was held is the High
Court got the revision powers even suo motu to take with an
opportunity to accused appellant to contest with the same.  The
said suo motu revision for passing orders for that conclusion by the
two Judge Bench in Sahab Singh relied upon earlier Three Judge
Bench of Eknath Shankarrao Mukkawar Vs. State of
Maharashtra  saying provision of appeal against inadequacy of
sentence does not take away High Courts power to enhance the
sentence by exercising suo motu powers apart from the said power
to file appeal against the inadequacy of sentence, which is no
doubt in relation to Food Adulteration case outcome of private
complaint procedure.  The other decision placed reliance is in this
regard is Govind Ramji Jadhav Vs. State of Maharashtra  of the
suo motu revision powers of the High Court to enhance the
sentence however by giving opportunity of hearing to the accused
in compliance with the principles of natural justice.  The other
decision referred is of the Three Judge Bench in Damodar
S.Prabhu Vs. Sayed Babalal  saying the object of incorporating the
penal provisions by Sections 138 to 142 of the Act amended by
66/1988 is to provide a strong criminal remedy in order to deter
the worryingly high incidence of dishonour of cheques as
possibility of imprisonment provides a remedy of punitive nature
and provision for imposing fine thereby may extend to twice the
amount of cheque to serve as compensatory purpose to the
complainant for the dishonour of cheque to describe the same as
regulatory offence as the impact of the offence usually confirmed to
private parties involved in the commercial transactions, which is
somewhat different to other conventional offences.  Even the Two
Judge Bench expression of the Apex Court in Somnath Sarka vs.
Utpal Basu Mallick  clearly says generally in cheque bouncing
cases as per the settled law the endeavour of the complainant is
only to get the cheque amount with interest rather than punishing
the accused for somewhat different to other conventional offence
with punitive measure.
      10. Here the cheque in question was dated 05.12.2011.
What the Section 138 of the Act speaks is imprisonment up to 2
years or double the amount of cheque or both as the case may be.
But for the amendment introduced to Section 143 of the Act by Act
No.55/2002 with effect from 06.02.2003 providing for expeditious
disposal by adopting summary trial rather than summons case, the
fine to be imposed is above Rs.5,000/- notwithstanding anything
contained in Cr.P.C. with imprisonment up to maximum of one
year.  This amendment provides where fine is imposed above
Rs.5,000/- it is with imprisonment which shall not exceed one
year notwithstanding anything contained even in Section 138 of
the Act and even Section 29 Cr.P.C.  Thus for lack of non absentee
clause in Section 138 which un-empowers a Magistrate to impose
more than fine of Rs.5,000/-, that is amended in 2005 in Cr.P.C.
Section 29 (2) Cr.P.C. to Rs.10,000/-, however by virtue of Section
143 after 06.02.2003 for the offence subsequent to that, fine about
Rs.5,000/- can be imposed unlimited from the bar under Section
138 of the Act or Section 29 (2) Cr.P.C. have no application for
Section 143 prevails over them.
      11. Here from the series of expressions though the
complainant by the 2 applications sought for awarding of
Rs.5,00,000/- as compensation in addition to the cheque amount
and also to enhance the sentence of imprisonment to the maximum
of 2 years, in view of the expressions relied by the complainant
itself which shows the aims and objectives of the provisions of the
Act which are somewhat different to the punitive consequence in
the sentencing policy in other conventional crimes, more
particularly, in Damodar S.Prabhu, R.Vijayan, S.R. Sunil &
Company and also Mainuddin supra besides Somanth Sarka  
supra, where it was held, imposing of sentence imprisonment till
rising of the day is just besides to compensate the complainant by
not only ordering of the amount of the cheque but also further
compensation to the complainant in the form of interest or
otherwise up to double the amount of the cheque.  It is in relation
to the sentence concerned.
      12. Now coming to the legality and correctness of the
concurrent findings of the conviction judgments of the Courts
below impugning by the appellant concerned, undisputedly the
Ex.P10 undertaking letter executed by the accused to compensate
the complainant for the sale agreement consideration and out of
part payment of which, the cheque in question issued from his
account.  It is proved by complainant by said evidence of the
cheque issued is for legally enforceable debt or other liability
covered by Ex.P10.  For Ex.P11-cheque when presented returned  
dishonoured even outcome of stop payment, it is within the
meaning of the provisions of the Act and even after dishonour
when statutory notice issued for any dispute of not served when
shows unclaimed from the presumption under Section 27 General  
Clauses Act of due service available therefrom it is of deemed
service and also held in this regard by the Three Judge Bench in
C.C. Alavi Haji Vs. Palapetty Muhammed  to said conclusion for
not even after filing of the private complaint case taken cognizance
and service of summons accused not chosen to pay the said cheque
amount, even the sale agreement mentioned with reference to
compromise in the statutory notice when it is clear of the cheque
issued for Rs.5,00,000/- returned dishonoured in which demand
to pay also if other amounts mentioned the notice no way invalid
therefrom as rightly concluded by the Courts below.
      13. Having regard to the above and there is no oath against
oath and there is no evidence in rebuttal and Exs.P10 and P11
with reference to Ex.P1 not in dispute, the Courts below are right
in finding the accused guilty and for this Court while sitting in
revision against that concurrent finding of guilt concerned there is
nothing to interfere.
      14. From what is discussed supra so far as sentence of
imprisonment with fine/compensation outcome of the fine
concerned as referred supra, to sub serve the ends of justice it is
just to modify from sentence of 6 months simple imprisonment
with fine of Rs.10,000/-, to imprisonment till rising of the day by
giving set off to the period undergone if any and fine of
Rs.10,00,000/- of which Rs.50,000/- goes to the State and
Rs.9,50,000/- as compensation to the complainant which includes
Rs.10,000/- fine if paid to adjust and out of it in compensation
received by complainant, for the balance to pay or deposit within
one month from today failing which with default sentence of 6
months simple imprisonment for the lower Court to levy under
Section 421 Cr.P.C. and enforce it.
      15. Accordingly and in the result, the criminal revision case
and Crl.R.C.M.P.Nos.1708 & 1709 of 2016 are allowed in part.
      Consequently, miscellaneous petitions, if any shall stand
closed.  No costs.
_____________________________________    
JUSTICE Dr. B.SIVA SANKARA RAO      
Date: 18.04.2017

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