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of <h1>Conviction upheld under Section 138 of Negotiable Instruments Act with modified fine and imprisonment.</h1> The High Court confirmed the accused's conviction under Section 138 of the Negotiable Instruments Act but modified the sentence to a fine of Rs. 1,00,000. ... Dishonor of Cheque - dispute is with regard to the actual amount borrowed and the period during which it was borrowed - legally enforceable debt or not - HELD THAT:- The trial court and also the appellate court has appreciated the facts and circumstances in a correct perspective and there is no illegality or irregularity in the finding of guilt under Sec.138 of the N.I.Act. Sentence - HELD THAT:- The sentence passed by the V Additional Sessions Judge, Ernakulam is to undergo simple imprisonment for three months and to pay compensation for ₹ 1,00,000/- in default to undergo simple imprisonment for two months - the sentence passed is modified to fine of ₹ 1,00,000/- in default to undergo simple imprisonment for three months. Fine amount, if realized, shall be paid to PW1 complainant as compensation under Sec.357(1)(b) Cr.P.C. Revision allowed in part. Issues Involved:1. Validity of the cheque issued by the accused.2. Evidence and documents presented by both parties.3. Presumptions under Sections 139 and 118 of the Negotiable Instruments Act, 1881.4. Adequacy of the notice issued under Section 138 of the Negotiable Instruments Act.5. Sentence imposed by the trial court and modified by the appellate court.Issue-wise Detailed Analysis:1. Validity of the Cheque Issued by the Accused:The accused borrowed Rs. 1,00,000 from the complainant and issued cheque No.278421 dated 21.3.2001, which was dishonored due to 'payment stopped' by the drawer. The complainant issued a registered notice, and upon non-payment, filed a complaint. The trial court found the accused guilty, sentencing him to six months of simple imprisonment and compensation of Rs. 1,00,000. The appellate court confirmed the conviction but reduced the sentence to three months.2. Evidence and Documents Presented by Both Parties:The complainant was examined as PW1, and Exts.P1 to P6 were marked. The accused was examined as DW1, and Exts.D1 to D8 were marked. The accused claimed to have borrowed Rs. 5,000 and Rs. 10,000 on different dates and repaid the amount, substantiated by Ext.D6 account book and Ext.D7 lawyer's notice. However, the courts found Ext.D6 to be a newly prepared document and not kept in the regular course of business. Ext.D1 and Ext.D2 counter-foils were also deemed self-serving.3. Presumptions under Sections 139 and 118 of the Negotiable Instruments Act, 1881:The courts held that once the issuance of the cheque is proved, the presumption under Section 139 of the NI Act favors the complainant. The accused failed to rebut this presumption with credible evidence. The courts cited precedents, including Hamsa Mussaliar v. Hamsa Khan and Bir Singh v. Mukesh Kumar, affirming that the burden is on the accused to prove the circumstances under which the cheque was issued.4. Adequacy of the Notice Issued under Section 138 of the Negotiable Instruments Act:The notice issued by the complainant was found to be within the statutory period and included a specific demand for the cheque amount, fulfilling the legal requirements. The courts referenced Central Bank of India v. M/s. Saxon Farms and Surendra Das B v. State of Kerala, emphasizing that the omission of transaction details in the notice does not invalidate it.5. Sentence Imposed by the Trial Court and Modified by the Appellate Court:The trial court sentenced the accused to six months of simple imprisonment and compensation of Rs. 1,00,000. The appellate court reduced the imprisonment to three months. The High Court modified the sentence to a fine of Rs. 1,00,000, with a default sentence of three months of simple imprisonment, aligning with the Supreme Court's decision in Kausalya Devi Massan v. Roopkishore Khore.Conclusion:The High Court confirmed the conviction under Section 138 of the NI Act but modified the sentence to a fine of Rs. 1,00,000, in default of which the accused would undergo simple imprisonment for three months. The bail bond was canceled, and the accused was directed to pay the amount forthwith, failing which the trial court would execute the sentence.
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