Appellant convicted under section 138 NI Act
2. Appellant herein challenges judgment and order dated 23 rd January, 2018 passed in Crl.R.P. No.1111 of 2011, whereby the High Court of Kerala allowed, only in part, his Revision Petition against the judgment and order of the learned Additional Sessions Judge, Thrissur, dated 11th January 2011, in Criminal Appeal No.673 of 2007, which, in turn, upheld his conviction, as handed down by the learned Judicial First Class Magistrate vide order dated 14th August 2007 in CC No.51 of 2003, under Section 138 of the Negotiable Instruments Act, 1881.
Whether accused can be held guilty whereas the competent civil jurisdictions already passed decree in connection with the same transaction
3. The sole issue that we are required to consider is, whether, a criminal proceeding can be initiated and the accused therein held guilty with natural consequences thereof to follow, in connection with a transaction, in respect of which a decree by a competent Court of civil jurisdiction, already stands passed.
Proceedings and facts before the lower court
4. The facts necessary to put into perspective the issue in the present appeal are:-
4.1 The Appellant borrowed Rs.2,00,000/- from the Complainant, K.P.B Menon “Sreyes,” with the promise that he would repay it on demand.
4.2 On receipt of such demand, he issued a cheque dated 30th June, 2002 for the said amount from the South Indian Bank, encashment thereof was to be through Canara Bank, Irinjalakuda Branch, to which the cheque was sent through the post with a covering letter dated 24th September, 2002.
4.3 It was dishonoured due to insufficient funds and ‘payments stopped by drawer’. The Complainant came to know of such dishonour and issued a notice of demand dated 22nd December, 2002. Accounting for no action on the part of the appellant, the complaint, the subject matter of the instant proceedings, came to be filed.
Same cheque was in issue before both civil and criminal courts and the conclusions of the courts below
6. Therefore, it appears from the record that the very same cheque was in issue before the Civil Court and also the Court seized of the Section 138 N.I. Act complaint.
The conclusions drawn by the Courts below, subject matter of the instant lis, are as under:
6.1 The Trial Court convicted the appellant herein to undergo simple imprisonment for one year as well as pay compensation of Rs.2 lakhs in default whereof, he was to undergo further simple imprisonment for six months. The determination of the issues, i.e., whether the decree passed by the Munsif Court would be binding on it, is of note. It was observed that a Court exercising jurisdiction on the criminal side is not subordinate to the Civil Court. Further, it was held “That order was an ex-parte order as far as criminal complaint is concerned the order of injunction issued cannot be granted and the hands of the criminal court cannot be fettered by the civil court”.
6.2 The First Appellate Court framed primarily one point for consideration – whether the cheque was issued against a legally enforceable debt, thereby attracting the offence under Section 138 of the N.I. Act. This point was held against the appellant and therefore, the conviction handed down by the Court below, accordingly confirmed.
7. The High Court, in revision, observed that no perversity could be indicated in the concurrent findings of the Trial Court and First Appellate Court. The same was dismissed.
10. We notice that this Court in Vishnu Dutt Sharma vs. Daya Sapra (Smt.) [(2009) 13 SCC 729] had observed as under:
“26. It is, however, significant to notice a decision of this Court in Karam Chand Ganga Prasad v. Union of India (1970) 3 SCC 694, wherein it was categorically held that the decisions of the civil court will be binding on the criminal courts but the converse is not true, was overruled therein…”
This Court in Satish Chander Ahuja vs. Sneha Ahuja [(2021) 1 SCC 414] considered a numerous precedents, including Premshanker (supra) and Vishnu Dutt Sharma (supra), to opine that there is no embargo for a civil court to consider the evidence led in the criminal proceedings.
The issue has been laid to rest by a Constitution Bench of this Court in Iqbal Singh Marwah vs. Meenakshi Marwah [(2005) 4 SCC 370].
After the civil court declared the cheque as security then the criminal court cannot provide sentence and damage to the accused
11. The position as per Premshanker (supra) is that sentence and damages would be excluded from the conflict of decisions in civil and criminal jurisdictions of the Courts. Therefore, in the present case, considering that the Court in criminal jurisdiction has imposed both sentence and damages, the ratio of the above-referred decision dictates that the Court in criminal jurisdiction would be bound by the civil Court having declared the cheque, the subject matter of dispute, to be only for the purposes of security.
Party
PREM RAJ … APPELLANT(S) VERSUS POONAMMA MENON & ANR. …RESPONDENT(S) – CRIMINAL APPEAL NO (1858 of 2024) OF 2024 (Arising out of Special Leave Petition (Crl.) No.9778/2018) – 2024 INSC 260
https://main.sci.gov.in/supremecourt/2018/31729/31729_2018_10_1502_51862_Judgement_02-Apr-2024.pdf
Further study
Author’s (section1.in) note
Kindly note that this judgment cannot be a settled proposition but concerns the fact that the civil court has found that the cheque which was in the same transaction in criminal court is a ‘security cheque’. This means the Hon’ble Supreme Court requires judicial discipline in judgments in same transaction.
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