2022 (2) TMI 1

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....ropolitan Magistrate, Cyberabad, Kukatpally at Miyapur. The facts of the case are as under: The 2nd respondent/complainant filed a private complaint under Section 200 Cr.P.C. against the revision petitioner/accused for the offence punishable under Section 138 of the Negotiable Instruments Act, stating that the revision petitioner/accused borrowed an amount of Rs. 1,10,000/- from him on 26.08.1999 and executed a promissory note agreeing to repay the same within one week from the date of demand made by the 2nd respondent/complainant. On repeated demands made by the 2nd respondent/complainant, the revision petitioner/accused issued a cheque bearing No.164596, dated 05.07.2002 for Rs. 1,81,400/.- drawn on State Bank of Hyderabad, Ramachan....

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....imposed by the trial Court against the revision petitioner/accused. Heard the learned Counsel appearing on either side and perused the record. Learned Counsel for the revision petitioner/accused would submit that though the 2nd respondent/complainant (P.W.1) admitted in his cross-examination that he was an income tax assessee, he has not shown the alleged transaction amount in his Income Tax Returns during that period and the said aspect has not been considered by both the Courts below; that P.W.1 further admitted in his cross-examination that he has not issued any notice to the revision petitioner/accused demanding repayment of loan; that P.W.1 also admitted that he has withdrawn Rs. 30,000/- by depositing the cheque of the revision pet....

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....omplainant towards discharge of legally enforceable debt, the trial Court has rightly found guilt of the revision petitioner/accused for the offence punishable under Section 138 of the N.I. Act, which was confirmed by the appellate Court. Considering rival contentions and perusing the material available on record, the point that arises for determination is "Whether the cheque under Ex.P1 was issued towards discharge of legally enforceable debt or not"? The case of the 2nd respondent/complainant is that the revision petitioner/accused had borrowed a sum of Rs. 1,10,000/- by executing a promissory note, dated 26.08.1999 and in order to discharge the said debt, the revision petitioner/accused had issued the impugned cheque for an amount ....

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....egotiable instruments are in fact the instruments of credit being convertible on account of legality of being negotiated and are easily passable from one hand to another. To achieve the objectives of the Act, the legislature has, in its wisdom, thought it proper to make such provisions in the Act for conferring such privileges to the mercantile instruments contemplated under it and provide special penalties and procedure in case the obligations under the instruments are not discharged. The laws relating to the Act are, therefore, required to be interpreted in the light of the objects intended to be achieved by it despite there being deviations from the general law and the procedure provided for the redressal of the grievances to the litigan....

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....healthy manner. The explanation to Section 138 of the said Act clearly provides that a debt or other liability referred to in section means a legally enforceable debt or other liability. The alleged liability to repay an unaccounted cash amount admittedly not disclosed in the Income Tax Return cannot be a legally recoverable liability. If such liability is held to be a legally recoverable debt, it will render the explanation to Section 138 of the said Act nugatory. It will defeat the very object of Section 138 of the Act of ensuring that the commercial and mercantile activities are conducted in a healthy manner. The provision of Section 138 cannot be resorted to for recovery of an unaccounted amount. A cheque issued in discharge of alleged ....

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....sed, on 26.08.1999, for Rs. 1,10,000/-, whereas the cheque under Ex.P1 was issued for Rs. 1,81,400/- on 05.07.2002. However, the 2nd respondent/complainant has not properly explained under what circumstances, the cheque was issued for Rs. 1,81,400/-. That apart, the 2nd respondent/complainant (P.W.1) has admitted in his cross-examination that he has withdrawn Rs. 30,000/- by depositing the cheque of the revision petitioner/accused on 01.12.2000, which clearly proves the contention of the revision petitioner/accused that the 2nd respondent/complainant had misused the cheques issued by him for obtaining a bank loan. In view of the judgments referred to above and for the aforesaid reasons, I am of the considered view that the finding record....