2003 (3) TMI 775 - HC - Indian Laws

Accused convicted under Section 138 of Negotiable Instruments Act, sentenced to 6 months, must pay double cheque amounts.

Jayam Company and Ors. Versus T. Ravichandran

The High Court overturned the trial court's decision and found the accused guilty under Section 138 of the Negotiable Instruments Act. The accused was ... - Issues Involved:1. Legally enforceable liability of the accused.2. Limitation period for filing the complaint.Detailed Analysis:Issue 1: Legally enforceable liability of the accusedThe appellants argued that the cheques were issued for discharging a legal liability, and the accused admitted his signature on the cheques. The trial court had acquitted the accused on the grounds that the cheques were obtained by force with the help of the police, and there was no legally enforceable liability. The appellants cited several judgments to support their case:- Hiten P. Dalal v. Bratindranath Banerjee: The Supreme Court held that the burden was on the appellant to disprove the presumptions under Sections 138 and 139 of the Negotiable Instruments Act, which he failed to discharge. The court emphasized that the presumption of liability under these sections must prevail unless rebutted by acceptable evidence.- K.N. Beena v. Muniyappan and Another: The court reiterated that under Section 118, it is presumed that a negotiable instrument was made for consideration, and under Section 139, it is presumed that the holder of the cheque received it for discharging a debt or liability. This presumption is rebuttable, but the burden of proof lies on the accused.- Suganthi Suresh Kumar v. Jagadeeshan: The court highlighted that the sentence for the offence under Section 138 should be of such a nature as to give proper effect to the object of the legislation, especially when the amount covered by the cheque remains unpaid.The trial court failed to consider the legal presumption under Section 139 of the Negotiable Instruments Act, which favors the holder of the cheque unless the contrary is proved. The trial court also overlooked the non-payment of the amounts borne by the cheques and the failure of the accused to reply to the legal notice, which are mandatory compliances. The trial court's conclusion that the cheques were obtained under coercion in the police station was not supported by any immediate response from the accused to the legal notice, making this defense invalid.Issue 2: Limitation period for filing the complaintThe appellants contended that the complaints were filed within the limitation period. The cheques were returned for insufficiency of funds on 9.2.2001, and the legal notices were issued on 19.2.2001, received by the accused on 20.2.2001. The accused had fifteen days from the date of receipt of the notice to settle the dues, which ended on 10.3.2001. The complaints were filed on 21.3.2001, within the prescribed time limit.The trial court erroneously concluded that the complaints were barred by limitation, focusing on the date the Magistrate put his signature (24.4.2001) rather than the date of presentment of the complaint (21.3.2001). The relevant date for computation of the period is the date of presentment of the complaint before the court, not the date of the Magistrate's signature or when it is numbered.Conclusion:The judgments of the trial court suffer from patent errors of law and a perverse approach. The High Court set aside the trial court's judgments, finding the accused guilty of the offence under Section 138 of the Negotiable Instruments Act. The accused was sentenced to six months of imprisonment in each case and ordered to pay compensation double the amounts of the cheques within thirty days from the date the copy of the judgment is made ready. Consequently, the connected criminal original petitions were closed.