TMI Blog2020 (11) TMI 503X X X X Extracts X X X X X X X X Extracts X X X X ..... able. Under the circumstances, it is the duty of the accused before the court by adducing evidence to show that the cheque was not supported by consideration and that there was no debt or liability to be discharged as alleged. It is necessary on the part of the accused to set up a probable defence for getting the burden of proof shifted to the complainant. Once such rebuttable evidence is adduced and accepted by the court, the burden shifts back to the complainant. Section 141 of the N.I.Act provides constructive liability on the part of the Directors of the company or other persons responsible for the conduct of the business of the company. Though the heading of Section 141 of the N.I.Act reads Offences by companies , as per the Explanation to that Section company means any body corporate and includes a firm or other association of individuals ; and director in relation to a firm, means a partner in the firm. Their liability is joint and several. Consequently, therefore, when an offence is alleged to have been committed by the partnership firm, every person who, at the time the offence was committed, was in charge of and was responsible to the firm for the conduct of it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of ₹ 5,000/- was imposed additionally as fine against the 1 st accused. The conviction and sentence imposed by the appellate court is confirmed. In view of the situation prevailing in the country due to the outbreak of Covid-19 Pandemic, this Court is inclined to grant six months' time from today to the revision petitioners/ accused 1 and 2 to deposit the compensation and the fine amount before the trial court, failing which the learned Magistrate shall take necessary steps to execute the sentence against the revision petitioners/accused 1 and 2 in accordance with law - the criminal revision petition is allowed in part. - Crl. Rev. Pet. No. 2528 OF 2010 - - - Dated:- 10-11-2020 - THE HONOURABLE MR.JUSTICE N.ANIL KUMAR FOR THE PETITIONER : BY ADVS. SRI.VARGHESE C.KURIAKOSE SRI.ADEEP ANWAR FOR THE RESPONDENT : R2 BY ADV. SRI.BIJISH B.TOM R2 BY ADV. SMT.A.KARTHIKA KAIMAL R2 BY ADV. SRI.V.J.MATHEW R2 BY ADV. SRI.VIPIN P.VARGHESE R1 BY SENIOR PUBLIC PROSECUTOR SRI.M.S.BREEZ ORDER This revision petition is directed against the judgment dated 31.5.2010 passed in Crl.Appeal No.128/2008 on the file of the third Additional Sessions Court, Ernakulam which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice on 19.4.2003. However, no reply was issued. 4. On service of summons, the accused appeared before the trial court. Particulars of the offence were read over and explained to the accused to which the accused pleaded not guilty. Thereafter the Legal Officer of the complainant company was examined as PW1 and marked Exts.P1 to P9 series. After PW1 was examined, the accused was questioned under Section 313(1)(b) of the Cr.P.C. for the purpose of enabling him to explain any circumstances appearing in the evidence against him. However no defence evidence was adduced. On appreciation of the evidence, the learned Magistrate held that the execution of the cheques was admitted by the accused and that it was proved by the complainant that the cheques were dishonoured for the reason 'exceeds arrangement'. Hence the learned Magistrate concluded that the cheques were issued by the accused for the discharge of debt or liability. 5. Heard Sri.C.Varghese Kuriakose, the learned counsel for the revision petitioners, Sri.M.S.Breez, learned Senior Public Prosecutor for the 1 st respondent-State and Sri.V.J.Mathew, the learned counsel for the 2 nd respondent. 6. Sri.C.Varghese Kuriak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egotiable instruments including cheques and to encourage and promote the use of negotiable instruments in financial transactions. Section 118 of the N.I.Act provides presumptions to be raised until the contrary is proved, i) as to consideration, ii) as to date of instrument, iii) as to time of acceptance iv) as to time of transfer v) as to order of indorsements, vi) as to appropriate stamp and vii) as to holder being a holder in due course. That apart, Section 139 of the N.I.Act provides that it shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in Section 138 of the N.I.Act for the discharge, in whole or in part, of any debt or other liability. Applying the definition of the word 'proved' in Section 3 of the Evidence Act to the provisions of Sections 118 and 139 of the N.I.Act, it becomes evident that in a trial under Section 138 of the N.I.Act, a presumption will have to be made that every negotiable instrument was made or drawn for consideration and that it was executed for discharge of debt or liability once the execution of negotiable instrument is either proved or admitted. Needless to say that, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t cannot personally enforce a contract under Section 230 of the Contract Act. It is contended that the transaction covered is not enforceable through court by the complainant. In support of his contention, the learned counsel for the revision petitioners/accused placed the following decisions for consideration:- 1. Marine Container Services South Pvt. Ltd. v. Go Go Garments [1998 KHC 843]. 2. Virender Khullar v. American Consolidation Services Ltd. and Others [2016 KHC 6552]. 3. Cochin Frozen Food Exports (P) Ltd. (M/s.) v. M/s.Vanchinad Agencies and Others [2016(4) KHC 233]. 4. Inter Asia Impex, Chennai v. Freightscan Global Logistics Pvt. Ltd., Chennai [2017 KHC 4617]. 5. South Bihar Power Distribution Co.Ltd. v. Bhagalpur Electricity Distribution Co. Pvt. Ltd. [2019 KHC 4167]. 11. Apart from the 1st accused partnership firm, the Managing Partner of the 1st accused was also made as an accused in the case. Admittedly, they issued the cheques. The cheques on presentation were dishonoured for the reason 'exceeds arrangement'. A person would be vicariously liable for commission of offence on the part of the partnership firm only in the ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny means any body corporate and includes a firm or other association of individuals ; and director in relation to a firm, means a partner in the firm. Their liability is joint and several. Consequently, therefore, when an offence is alleged to have been committed by the partnership firm, every person who, at the time the offence was committed, was in charge of and was responsible to the firm for the conduct of its business as well as the firm shall be deemed to be guilty of the offence and shall be liable to be proceeded under Section 138 of the N.I.Act. In S.M.S Pharmaceuticals Ltd. v. Neeta Bhalla another [(2005) 8 SCC 89] it was held that a signatory to the cheque can be held to be a person liable under Section 141 of the N.I.Act. It has come out in evidence that the 2nd accused issued the cheques in favour of the complainant for a legally enforceable debt. The cheques in question were drawn for consideration and the holder of the cheques received the same in discharge of an existing debt. Ex.P3 bill of lading is not sufficient to indicate that the amount was due to M/s.Hyundai Merchant Marine Company Ltd. and the complainant was actually the steamer agent of the company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sued for discharging a debt or liability. Paragraphs 39 and 40 of the above case are relevant in this context and the same is extracted below for convenience of reference:- 39. It is not the case of the respondent- accused that he either signed the cheque or parted with it under any threat or coercion. Nor is it the case of the respondent-accused that the unfilled signed cheque had been stolen. The existence of a fiduciary relationship between the payee of a cheque and its drawer, would not disentitle the payee to the benefit of the presumption under Section 139 of the Negotiable Instruments Act, in the absence of evidence of exercise of undue influence or coercion. The second question is also answered in the negative. 40. Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under Section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt. 16. In view of the above, both the trial court and the appellate court rightly held that the burden was on the accused to disprove the initial presumption under Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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