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Veera Constructions And Ors. Versus R. Karthick

2015 (6) TMI 1131 - MADRAS HIGH COURT

Guilty under Section 138 of the Negotiable Instruments Act - proof of legally enforceable debt or liability - Held that:- There is a vast difference between proof of execution of the promissory note and the proof of the signature of the executant in the document. Law requires not the proof of signature alone, but the proof of execution of the document. Here in this case, though the signatures have been admitted by the accused, that will not automatically go to prove the execution of the promisso .....

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8 of the Act, even though the cheque is dishonoured for want of sufficient funds. In this case, the complainant has failed to prove that the cheque in question was issued as against any legally enforceable debt. - In this case, assuming that the defence taken by the accused, on the face of the transaction between Rajaraman and the accused, may not be true, even then the complainant has to fail in the case, because he has failed to prove the legally enforceable debt on the part of the accused .....

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rned Judicial Magistrate No. III, Trichy. The first accused is a Company, the 2nd accused is its Managing Partner and the third accused is a partner of the said Company. The respondent filed the said case by way of private complaint alleging that the petitioners committed offences punishable under Section 138 of the Negotiable Instruments Act. The trial Court by judgment dated 29.02.2012, found the accused guilty under Section 138 of the Negotiable Instruments Act and sentenced the first accused .....

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entence imposed by the trial Court. As against the same, the petitioners are before this Court with this revision. ( 2. ) The case of the respondent is as follows: The first accused is a construction company. The accused 2 and 3 are the managing partner and partner respectively of the first accused Company. The 2nd accused is well known to the complainant. On 01.08.2004, on behalf of the first accused company, the 2nd accused borrowed a sum of ₹ 1,50,000/ - and duly executed a promissory n .....

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s drawn as against the account maintained in the name of the first accused company and the same was issued by the accused 2 and 3 on behalf of the first accused Company. When the said cheque was presented for collection, it was dishonoured by the bank as an endorsement "account closed". Thereafter, a legal notice required under Section 138 of the Negotiable Instruments Act was issued by the respondent to the petitioners on 01.05.2007 under Ex.P4. Having received the same, the accused s .....

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rials were put to the accused, they denied the same as false. On their side, the third accused was examined as D.W.1, wherein, he has stated that he had business transaction with one Mr. Rajaraman from whom he borrowed a sum of ₹ 3 lakhs and as a security, he had handed over the cheque in question, which was then blank, but signed by the accused 2 and 3 and also a blank promissory note, but signed by the 2nd accused and the third accused. He has further stated that as early as on 11.05.200 .....

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n 29.01.2007 itself, wherein he has stated that the documents were not in his custody. To the contrary, he made certain other documents regarding the transaction pertaining to the land. D.W.1 has further stated that the promissory note in question had not been executed in favour of the complainant at all and the complainant was not even known to them. He has further stated that the cheque was issued only to Mr. Rajaraman, which was then blank, but signed, only for the purpose of security. Having .....

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ue in question was not at all issued to the complainant and as a matter of fact, it was issued only to Mr. Rajaraman. He would further submit that it was not duly executed, which was given only as a blank cheque. The learned counsel would further submit that so far as the promissory note is concerned, that was also given as a blank promissory note, but signed by A2 and A3 to Mr. Rajaraman. The learned counsel would submit that the exchange of notices between the accused 2 and 3 and Mr. Rajaraman .....

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is concerned, the learned counsel would submit that the same yardstick would applicable. Apart from that the learned counsel would submit that as required under the Evidence Act, the promissory note has not been proved by examining the attestor. P.W.1, during cross examination, has admitted that he does not know whether the promissory note was scribed by one Mr. Muthu or his son. The learned counsel would further submit that there is no evidence at all about the execution of the promissory note .....

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is no mention about the cheque in question as well as the promissory note in question. He would further submit that in the reply sent by Mr. Rajaraman, he has not admitted that the cheque in question and the promissory note were issued to him. The learned counsel would further submit that P.W.1's evidence would clearly go to show that the cheque was issued only to the complainant. He would further submit that the execution of the promissory note has also been proved by examining P.W.1. Thus .....

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only a small discrepancy and that would not go to the root of the prosecution case. At any rate, according to the learned counsel, the Courts below have appreciated the evidence and have come to the concurrent finding that the accused are guilty. Thus, according to him, no interference is required at the hands of this Court. ( 6. ) I have considered the above submissions. In order to hold the accused guilty under Section 138 of the Negotiable Instruments Act, it is mandatory under Section 138 o .....

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lable. It was known to him and to his wife alone. Thus, it is within his exclusive knowledge as to what had happened and what transpired at the time, when the money was paid by way of loan to the accused. The burden is, therefore, upon him as required under Section 106 of the Evidence Act. But he has not disclosed as to where and when, the promissory note was executed and by whom it was scribed. During cross examination, P.W.1 has stated that he does not know whether the promissory note was scri .....

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xtly , in order to prove the original debt, which forms part of the original cause of action and for the entire lis, it is for the complainant to prove the execution of the promissory note. As per the Evidence Act, there is a special mode of proof of a promissory note, which requires that atleast one of the attestors should be examined. Here, in this case, the promissory note shows that the 2nd accused is an attestor. Therefore, one cannot expect the complainant to examine him as a witness, as i .....

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t would submit that the accused have admitted their signature in the promissory note. There is a vast difference between proof of execution of the promissory note and the proof of the signature of the executant in the document. Law requires not the proof of signature alone, but the proof of execution of the document. Here in this case, though the signatures have been admitted by the accused, that will not automatically go to prove the execution of the promissory note. Therefore, this argument of .....

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e is dishonoured for want of sufficient funds. In this case, the complainant has failed to prove that the cheque in question was issued as against any legally enforceable debt. Now, turning to the other argument of the learned counsel for the petitioners, i.e. the transaction between Mr. Rajaraman and the accused, Exs.D1 to D4 would go to show that the exchange of notices and the same commenced in the year 2005 and ended on 22.02.2007. Though Mr. Rajaraman in the reply notice has denied the alle .....

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