TaxTMI 
TaxTMI 
TaxTMI 
2019 (12) TMI 1666
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....cused, who is the wife of his friend, borrowed from him an amount of Rs. 1,30,000/- for her personal needs by the end of November, 2003, agreeing to discharge the debt within a month. Since she failed in her promise, she issued Ext. P1 cheque dated 13.2.2004 in his name drawn on her banker, South Malabar Gramina Bank for the amount borrowed. The cheque on presentment was dishonoured on the ground of want of sufficient funds at the credit of the accused. A notice sent to accused demanding discharge of debt was replied by her denying the whole transaction. Therefore, the complainant lodged prosecution against her invoking Section 138 of the N.I. Act. 3. She denied the charge against her when it was read over and explained to her and the appe....
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.... passed. 5. I heard the learned counsel for the appellant and also the learned counsel for the first respondent, accused. 6. It is contended by the learned counsel for the appellant that the court below failed to read the evidence in its correct perspective and came to an erroneous conclusion that the real transaction was between P.W. 1 and D.W. 2. It was also argued that even if it was assumed for a moment that the transaction was between P.W. 1 and D.W. 2 also, the prosecution of accused was sustainable since Ext. P1 was nevertheless a cheque executed and issued by her for consideration, no matter it might have been issued in discharge of liability of her husband. It is also contended that accused has not taken a contention anywhere tha....
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....e debt in discharge of which Ext. P1 cheque was issued, arose out of a transaction between P.W. 1 and D.W. 2. The evidence on record does not prove that accused borrowed any amount from the complainant. The evidence given by P.W. 1 that she borrowed Rs. 1,30,000/- from him is not convincing. But at the same time, there is reliable evidence to the effect that she delivered Ext. P1 cheque drawn from her account in the name of P.W. 1. P.W. 1 himself admitted that there was a mediation talk with D.W. 2 at the office of C.I. of Police, Nilambur with respect to the transaction covered by Ext. P1 cheque and consequently an agreement was also arrived at between them. He admitted that he also signed the agreement. 9. According to D.W. 2, the agreem....
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....on of 'holder' in Section 8 of the said Act becomes significant. So far as the question of delivery of cheque is concerned, there is ample evidence that accused delivered Ext. P1 to P.W. 1. In Ext. D1 reply notice also, there is no specific denial of delivery of Ext. P1 cheque. On the other hand, a different cheque bearing No. 840577 which has no bearing in the case seems to have been denied in the reply notice. In all probability, therefore what could be presumed from the totality of evidence and circumstances is that accused had drawn and issued Ext. P1 as a guarantor cheque in favour of P.W. 1 in discharge of liability of her husband. 12. A cheque issued by a guarantor is also a cheque regarded by Section 138 of the N.I. Act as ....
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....his choice, refer to his banker, no matter the drawer has not incurred any liability to the person named by him in the cheque. Section 138 of the N.I. Act does not demand that drawer should have had transaction or dealing with the payee in whose name the cheque was drawn. Therefore the accused cannot escape from the prosecution for the offence under Section 138 of the N.I. Act only because the real money transaction was between her husband and complainant. I have already held that the probabilities of the case have indicated that issue of Ext. P1 cheque was in discharge of her husband's liability to P.W. 1. 14. But question that arises is whether she could be charged with criminal liability if she could show by materials on record that....