TMI Blog2021 (1) TMI 625X X X X Extracts X X X X X X X X Extracts X X X X ..... ame is void if the indorsee does not consent thereto with regard to making of such alteration. Therefore the word consent used in the said provision would be an express consent on such material alterations. In the present case on hand Ex. P.1 clearly exhibits the indorsement by accused No. 2 just below the alterations made on date of cheque. But admittedly there is no such indorsement by respondent/accused No. 2 who is also supposed to be the signatory of the cheque. It is also apparent on face of Ex. P.1 that there is no indorsement made below the alteration of the account number on Ex. P.1. When this fact was confronted to DW.1 complainant, she has no doubt admitted alterations on the cheque, but has denied suggestion that she altered the cheque. On a perusal of evidence of PW.1, it is clearly seen that PW.1 does not know about alleged transaction mentioned in the complaint as she has clearly deposed by stating that she does not know as to when and on what date she has deposited a sum of ₹ 68,75,148/- with the society. As stated earlier, at one breath she says that amount is deposited by her and at another breath she says amount is deposited by her husband. It is also a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... truments Act, 1881 (for short 'the N.I. Act'). 2. Parties shall be referred to as per their status before the trial Court. 3. Brief facts leading to filing of this appeal are as under: It is the case of the complainant that accused No. 1 is the President of Sasya Shamala Souharda Credit Co-operative Ltd., Hospet and accused No. 2 is the Chief Executive Officer of the said society. Both the accused were required to pay an amount of ₹ 4,00,000/- to the complainant and to discharge their liability, they issued a cheque bearing No. 006062000015000 jointly for a sum of ₹ 4,00,000/- dated 23.02.2007 in favour of complainant. The complainant presented the aforesaid cheque on several occasions i.e. on 24.02.2007, 07.03.2007 and 08.03.2007. The cheque came to be dishonoured for the reason 'insufficient funds'. Thereafter, the complainant got issued a legal notice dated 10.08.2007 to both the accused calling upon them to make the payment of dishonoured cheque. Despite receipt of legal notice, neither the accused repaid the amount demanded nor replied to the legal notice. Thereafter, the complainant registered a complaint under Section 138 of the N.I. Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and D2 produced by accused No. 2 clearly establish the fact that the accused were aware of the transaction and hence, they have taken a frivolous and inconsistent plea only to defraud the complainant. This fact is ignored by the trial Court, which is erroneous in law. 8. He further contends that though there is certain difference in the ink used in filling up of Ex. P1 and there is alteration in the cheque-Ex. P1, the same would not be fatal to the case. In view of the fact that Section 20 of the N.I. Act permits the holder in due course and the payee to fill up the contents of the cheque, the material alternation plea which is taken up by accused No. 1 would not be fatal to the case of the complainant. Hence, by such defence itself, the trial Court ought not to have acquitted the accused. The learned counsel further contends that in Ex. P9-reply to the legal notice, it is clearly stated by accused No. 2 that if the complainant had come to the office personally, he would have paid the amount of ₹ 4,00,000/-. 9. In view of admission made by accused No. 2 in Ex. P.9, it is a clear case of acceptance of legal debt and liability and therefore trial Court ought to have convi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accused No. 2 and there is no indorsement by respondent accused No. 1. Therefore when there is no indorsement to the material alterations on Ex. P.1, there is no consent or agreement to the said corrections made in Ex. P.1, thereby making the instrument void as contemplated under section 87 of the Act. On this ground also impugned order of acquittal passed by trial Court is well reasoned and the same is to be sustained. 13. It is further contended by learned counsel for respondent that without proceeding further as against accused No. 2, complainant having proceeded only as against respondent/accused No. 1 is fatal to the case of complainant and on this ground also the acquittal order passed by trial Court is correct and the same is sustainable in law. Learned counsel further contends that it is the case of complainant that Ex. P.1 cheque has been issued on behalf of society i.e., Sasya Shyamala Souharda Credit Co-operative Limited. But non impleading and making the society as party to the proceedings is fatal to the case of complainant in view of section 142 of the Act which contemplates that if cheque is issued by either company, firm or association of persons, then it is nece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ality and there is no challenge to the said order by complainant. 17. No doubt PW.1 has stepped into witness box and adduced evidence reiterating the averments made in the legal notice as well as in the complaint. She has got produced Exs. P.1 to P.9. She relies more on Ex. P.9 which is a reply sent by accused No. 2, wherein accused No. 2 has admitted liability of ₹ 4,00,000/- to be paid to complainant. Apart from this, there is no other document placed on record by complainant other than Ex. P.1 to prove her case. All other exhibits i.e., Exs. P.1 to P.8 are cheque, bank indorsement, legal notice and postal receipts/acknowledgements. 18. In cross-examination, PW.1 has admitted with regard to material alterations on the cheque and admitted the fact that there are two account numbers mentioned on the cheque Ex. P.1. Further she has admitted that she does not know who gave the cheque. Further PW.1 in her evidence has admitted that she has kept a deposit with society which was belonging to her and thereafter again she has stated that deposit was kept by her husband and it is her husband who knows details of other transactions. She has also admitted that it is only her husb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice, in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and (c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice. Explanation: For the purposes of this section, debt of other liability means a legally enforceable debt or other liability. 21. It is seen that on fulfillment of the ingredients of proviso (a) to (c) of section 138 of Negotiable Instruments Act, the offence is technically made out. On cognizance being taken by the Court, presumption under section 139 of the Act comes into play in favour of complainant, which reads as under: 139. Presumption in favour of holder 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 for the discharge, in whole or in part, of any debt or other l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lternation by endorsee: and any such alteration, if made by any endorsee, discharges his endorser from all liability to him in respect of the consideration thereof. The provisions of this section are subject to those of sections 20, 49, 86 and 125. 26. When there is any alteration made by an indorsee, the same is void if the indorsee does not consent thereto with regard to making of such alteration. Therefore the word consent used in the said provision would be an express consent on such material alterations. In the present case on hand Ex. P.1 clearly exhibits the indorsement by accused No. 2 just below the alterations made on date of cheque. But admittedly there is no such indorsement by respondent/accused No. 2 who is also supposed to be the signatory of the cheque. It is also apparent on face of Ex. P.1 that there is no indorsement made below the alteration of the account number on Ex. P.1. When this fact was confronted to DW.1 complainant, she has no doubt admitted alterations on the cheque, but has denied suggestion that she altered the cheque. However PW.1 has further admitted in cross-examination that she does not know on what date cheque was given to her. Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In fact, the undated Ex. P9 produced by the Complainant and the material alteration on Ex. P1 which is indorsed by accused No. 2 and dismissal of the Complainant for non-prosecution as against accused No. 2, the same having reached finality and no action has been taken by the Complainant against accused No. 2, all goes to prove that there is collusion between the Complainant and accused No. 2. All these aspects have been considered by the trial Court in detail and an order of acquittal is rightfully passed by the trial Court. It is apparent on the face of Ex. P1 that there is material alteration and there is no endorsement by respondent - accused No. 1 to consent to the said material alteration on Ex. P1. Therefore, as per Section 87 of NI Act any negotiable instrument with material alteration renders the same void as there is no consent thereto for the said material alteration. In the present case, admittedly there is only one signature under the date on Ex. P1 and admittedly, the respondent - accused No. 1 has not indorsed the material alteration. Therefore, without any doubt it can be safely concluded at Ex. P1 is hit by Section 87 of NI Act. 32. For the aforesaid reason, I a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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