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CASE NO.: Appeal (crl.)  776 of 2008

PETITIONER: Sudhir Kumar Bhalla

RESPONDENT: Jagdish Chand, etc. etc.

DATE OF JUDGMENT: 01/05/2008

BENCH: S. B. Sinha & Lokeshwar Singh Panta

JUDGMENT: JUDGMENT O R D E R REPORTABLE

CRIMINAL APPEAL No.  776       OF 2008 [Arising out of S.L.P. (Crl.) No.2541 of 2007]

WITH CRIMINAL APPEAL Nos. 780, 781, 779, 782, 777 & 778                                  OF 2008 [Arising out of S.L.P. (Crl.) No. 2545, 2546, 2548, 2550, 2988, 2990 of 2007]

Leave granted in all the above-said Special Leave  Petitions. We have seven appeals before us in which the parties are  similar.  Since all these appeals arise out of common  judgments and orders dated 25.01.2007 and 19.02.2007  passed by a learned Single Judge of the High Court of Punjab  and Haryana in Criminal Appeal No. 1410-SBA of 2002,  Criminal Appeal No. 1411-SBA of 2002, Criminal Appeal No.  1412-SBA of 2002, Criminal Appeal No. 1413-SBA of 2002,  Criminal Appeal No. 1433-SBA of 2002, Criminal Misc.  Petition No.29090-M of 2001 and Criminal Misc. Petition  No.36987-M of 2001.  As similar questions of facts and law are  involved, therefore, for the sake of convenience they are being  heard together and disposed of by this common judgment. Brief facts, which led to the trial of the appellant, are as  follows:- Jagdish Chand - respondent herein and his wife Smt.  Ramesh Rani are the proprietors of M/s Mehra Export  Corporation and M/s Mehra International, Katra Hari Singh,  Amritsar.  The firms deal in saffron, herbs and other like  goods.  M/s Sudhir Kumar Bhalla and Brothers, 25, Green  Park, Ludhiana, of which Sudhir Kumar Bhalla - appellant  herein is one of the partners, has been purchasing various  goods from the firms of Jagdish Chand and Ramesh Rani.  The  sale price was being paid in cash and at times, through  cheques. In the month of May, 1997, the appellant on behalf of his  firm issued six cheques Nos. 442344, 442345, 442346,  442347, 442348 and 442349 dated 01.05.1997, 03.05.1997  and 05.05.1997 in favour of M/s Mehra Export Corporation  and M/s Mehra International.  Out of those six cheques, two  cheques were in the sums of Rs.30,000/- each and four  cheques were in the sums of Rs.40,000/- each.  All those  cheques were drawn in favour of the Indian Overseas Bank,

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Ludhiana. One of the cheques, in the sum of Rs.30,000/-, was  stated to have been encashed, whereas the other five cheques  have been dishonoured on the ground of ’Exceed  Arrangement’.  On 20.05.1997, the respondent sent statutory  notices under Section 138 (5) of the Negotiable Instruments  Act, 1881 [for short ’the Act’] to the appellant, which were  despatched through registered post on 24.05.1997.  However,  the same were received back on 28/29.5.1997 with a report  that the addressee was ’not met’.  The respondent again sent  another notice on 04.06.1997 through courier, which again  was not accepted by the appellant and the same was received  back on 05.06.1997 with the report of refusal.   It was on 13.06.1997 that the respondent, on his behalf  and on behalf of his wife as her attorney, filed five criminal  complaints under Section 138 of the Act read with Section 420  of the Indian Penal Code [for short ’the IPC’] in the Court of  Chief Judicial Magistrate, Amritsar, against the appellant.  On  09.07.1997, the respondent-complainant made a statement  that he wanted to withdraw the said complaint with  permission to file the fresh complaint.  The learned Chief  Judicial Magistrate vide his order dated 09.07.1997 passed  the following order:- "In view of the statement given by the  complainant, recorded separately, the  present complaint is hereby dismissed as  withdrawn."

On 12.07.1997, the respondent filed second complaint on  similar and practically the same points purported to have  accrued on identical causes of action.  The second complaint  was entrusted to the Court of Judicial Magistrate, 1st Class,  Amritsar, who recorded the statement/evidence of the  respondent on 12.07.1997.  Thereafter, the Judicial  Magistrate, 1st Class, vide order dated 23.08.1997 issued  summon to the appellant.  The appellant appeared on  06.04.1998 before the Judicial Magistrate and filed an  application for discharging him in the case.  However, on  01.06.1998 the Judicial Magistrate dismissed the said  application.  After following and adopting the due procedure as  prescribed under the Code of Criminal Procedure, 1973 (for  short ’Cr.P.C.’), the trial court dismissed the complaint on  06.02.2002 and acquitted the appellant.       Being aggrieved by the order of acquittal of the appellant  by the trial court, the respondent filed five criminal appeals,  two as an attorney of his wife and three on his behalf, in the  High Court.   In April 1998, the appellant approached the Court of  Judicial Magistrate, 1st Class, Ludhiana, under Section 156 of  Cr.P.C. by way of two separate applications alleging fraud,  cheating, tampering of the cheques by the respondent and his  wife and prayed that the police be directed to register criminal  cases against them.  On the directions of the learned  Magistrate, FIR No.93 of 1998 was registered against the  respondent under Sections 420, 463, 465, 468 and 471 of the  IPC, whereas second FIR No.94 of 1998 was lodged against  Jagdish Chand and Smt. Ramesh Rani under Sections 420,  463, 465, 468, 471 and 120-B of the IPC at Police Station,  Sarabha Nagar, Ludhiana.  After investigation, the police filed  challans in both the cases in the court.  The trial court charge  sheeted the respondent and his wife vide two separate orders  dated 15.01.2000.  They filed two revision petitions against the  orders of framing charges against them, which were dismissed  by the learned Sessions Judge, Ludhiana, vide separate orders  dated 04.06.2001.  The respondent and his wife filed two

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Criminal Miscellaneous Petitions Nos. 29090 and 36987-M of  2001 in the High Court challenging the validity and  correctness of the orders of the learned Trial Magistrate as  also of the learned Sessions Judge.      The High Court vide its judgment dated 25.01.2007  allowed the above-said five appeals and convicted the  appellant under Section 138 of the Act.  By the same order,  Criminal Misc. Petitions Nos. 29090 and 36987-M of 2001  were allowed and FIR Nos. 93 and 94 of 1998 lodged by the  respondent and his wife were quashed.  By order dated  19.02.2007, the appellant was sentenced to undergo R.I. for  one year and to pay a fine of Rs.8 lacs and in default thereof,   the appellant shall undergo further R.I. of one year.  Hence,  the appellant has preferred these appeals. We have heard the learned counsel for the parties and  with their assistance, examined the entire material placed on  record. Mr. P.S. Patwalia, learned senior counsel appearing on  behalf of the appellant, assailed the judgment of the High  Court inter alia contending:- (i)     that the learned Single Judge erred in not  appreciating the statement of the respondent- complainant in which he admitted that all the  cheques were filled by him, the date and  figures of the amounts were also in his  handwriting and the appellant simply had  signed the cheques.  According to the learned  counsel, the cheques in question have been  forged and fabricated by the respondent by  making material alteration by changing figure  in digit from Rs.30,000/- to Rs.3,00,000/- by  adding  ’zero’ at the end of Rs.30,000/- and  Rs.40,000/- to Rs.4,00,000/- by adding ’zero’  at the end of Rs.40,000/-; and (ii)    that the learned Single Judge erred in not  addressing the legal arguments raised on  behalf of the appellant that the provisions of  Section 138 of the Act are only attracted if the  cheques issued in discharge of liability or debt  are dishonoured, but not on account of  security cheques. Mr. Ankit Singhal, learned counsel for the respondent, on  the other hand, contended that the reasons given by the High  Court recording the order of conviction of the appellant are  based upon proper appreciation of evidence led by the  respondent in the case.  He submitted that this Court should  be slow to interfere in the well-reasoned and well-merited  judgment of the High Court.   We have given our anxious consideration to the rival  contentions of the learned counsel for the parties.  The  arguments put forward by Mr. Patwalia deserve to be  accepted. We have gone through the record of the trial Magistrate  placed before us.  In support of the complaint filed under  Section 138 of the Act, the trial Magistrate examined the  respondent on 27.04.1999.  On 05.05.2000, the respondent in  his cross-examination admitted as under:- "I have brought the account books for the  year 1995-96 and 1996-97.  I have seen  the ledger for the year 1995-96 where  there is a payment of rupees one lac  dated 26.10.1995 having been made by  the accused to me but the remaining  amounts are for an amount of  Rs.35,000/- each and at one time it was

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for an amount of Rs.40,000/-.   Once a  payment of Rs.25,000/- was also made in  the said year.  This ledger relates to the  firm M/s Mehra Exports.  The payments  of Rs.35,000/- each have  been made  either through cheques or through drafts.   I have also seen the ledger book of M/s  Mehra International for the year 1995-96.   Except Rs.10,000/- all the payments  made in this account are either through  draft or through cheque.  The lowest  payment in this account in this year is  Rs.10,000/- the maximum payment  made by the accused to this firm in this  account is Rs.50,000/-.  The notices were  sent only to the firm M/s Sudhir Kumar  Bhalla and Brothers before filing the  complaint and not to the partners  individually.  We did not receive any  cheque from the accused bearing  No.442344. We never received any  advance payment from the accused.  As  per account books of firm M/s Mehra  International for the year 1997-98 a sum  of Rs.7,16,672.50 ps.  On account of  principal amount is due from the  accused."

The respondent again stated as under:- "The cheque No.442347 is in my hands  which is dated 5.5.1997 but the same is  signed by accused Sudhir Kumar Bhalla.   All the cheques which are subject-matter  of other complaints are filled in by me  and are signed by Sudhir Kumar Bhalla  accused.  The dates on the cheques are  also in my hands.  The amount of the  cheques in words and figures are also in  my hands.  I can read the contents of the  cheques clearly."

On 05.05.2000, the trial court on the basis of the  statement of the respondent-complainant in his cross- examination made the following observations:-    "At this stage, counsel for accused had  made a request for giving note regarding  the demoneur of the witness as well as to  give note on the aforesaid fact so that the  document may not be tampered with  subsequent. Heard, without commenting  upon the demoneur of the witness at this  stage.  I have observed from cheque No.  442349 dated 3.5.1997 the last zero of  the figure written in the column of rupees  is separate from the remaining four zeros  which are attached with each other in the  same flow."  

Thereafter, on 21.05.2001 the cheques were sent to Mr.  Sardara Singh Parmar, Document Expert, for examination,  who in his report dated 21.05.2001 submitted to the Court,  opined as under:- "In view of the reasons stated above, I am  of the opinion that the last figure (0) in  above mentioned cheque has not been

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written in the continuous process by the  same person with the same pen and ink,  but it has been subsequently changed  into by adding figure (0) in the original  amount Rs. 40,000/- and it is free hand  forgery."

Mr. Sardara Singh Parmar was examined as DW-3 before  the trial court on 13.08.2001 and deposed as under:-     "I am of the opinion that the last figure  zero in above mentioned cheque has not  been written in the continuous process  by the same person with the same pen  and ink, but it has been subsequently  changed into by adding figure zero in the  original amount Rs. 30,000/- and it is  free hand forgery.  The reasons have  already been given in my report dated  21.5.2001.  It consists of 6 pages and it is  Ex.DW3/1.  It has been prepared by me  signed by me and is correct.  One  photograph chart bearing the photograph  cheque No. 442345 dt. 5.5.97 is  Ex.DW3/2, one negative is Ex.DW/3."

As noticed above, the Judicial Magistrate vide his  judgment dated 06.02.2002 acquitted the appellant of the  charge under Section 138 of the Act and consequently  dismissed the complaint of the respondent. The learned Single Judge of the High Court, after hearing  the learned counsel for the parties, recorded the conviction of  the appellant vide order dated 25.01.2007 for an offence under  Section 138 of the Act, which reads as under:- "Lastly, it was contended by the learned  counsel for Sudhir Kumar Bhalla that the  figures of Rs.30,000/- and Rs.40,000/-  mentioned in the cheques were  interpolated by adding ’zero’ to make the  same Rs.3,00,000/- and Rs.4,00,000/-.   He contended that there is evidence of  the handwriting expert to establish the  afore-stated fact and the trial court had  rightly dis-believed the claim of Jagdish  Chand on this court.

The contention of the learned counsel for  Sudhir Kumar Bhalla is misplaced.  The  trial court had clearly fallen in error by  ignoring the fact that the cheques were  not only filled in figures, but in words as  well, according to which Rs.3 lacs and  Rs.4 lacs were written thereon.  Even  though, the handwriting expert opined  that the zero has been added in the  cheques subsequently, but it was clearly  in consonance with the wishes of Sudhir  Kumar Bhalla, who had issued the  cheques by depicting the amounts in  words also.

That apart, there is cogent evidence on  record in the shape of original bills and

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the complete details of the prices of the  goods supplied and the registers of  account, which could not be countered by  Sudhir Kumar Bhalla during the course  of evidence.  In view of the overwhelming  evidence in favour of Jagdish Chand, the  findings of the trial court awarding an  acquittal to Sudhir Kumar Bhalla are  unsustainable.

On the basis of the above discussion, it is  held that Sudhir Kumar Bhalla, who was  one of the partners of M/s Sudhir Kumar  Bhalla & Brothers, Ludhiana, issued the  cheques in question to discharge the  liability of his firm and on presentation  thereof by Jagdish Chand and Ramesh  Rani, the same were dishonoured.  Thus,  he had committed an offence punishable  under Section 138 of the Act.  This court  holds him accordingly guilty for the same  in each of the appeals.     For the reason that the findings qua  interpolation in the cheques in question  have been categorically set aside, the  proceedings against Jagdish Chand and  Ramesh Rani initiated in the court of  Judicial Magistrate, 1st Class, Ludhiana,  pursuant to FIR Nos. 93 and 94 of 1998  registered at Police Station Sarabha  Nagar, Ludhiana, which have been  assailed in Criminal Miscellaneous  Petitions Nos. 29090-M and 36987-M of  2001, must, as a logical consequence,  fail.  In view of the above, the criminal appeals  and the criminal miscellaneous petitions  filed by Jagdish Chand and Ramesh Rani  are accepted.  The proceedings taken  against Jagdish Chand and Ramesh Rani  in pursuance to FIR Nos. 93 and 94 of  1998 registered at Police Station Sarabha  Nagar, Ludhiana, are also quashed."

On examination of the above-stated findings of the  learned Single Judge in the judgment impugned before us, we  find that the learned Single Judge has not addressed himself  on the legal question raised before him by the appellant that  the criminal liability of the appellant under the provisions of  Section 138 of the Act are attracted only on account of the  dishonour of the cheques issued in discharge of liability or  debt, but not on account of issuance of security cheques.  The  learned Single Judge has also not given cogent, satisfactory  and convincing reasons for disbelieving and discarding the  pre-charge evidence of the appellant corroborated by the  evidence of the expert opinion in regard to the interpolation in  and fabrication of the cheques by adding one more figure ’0’ to  make Rs.30,000/- to Rs.3,00,000/- and similarly adding one  more figure ’0’ to make Rs.40,000/- to Rs.4,00,000/-. In the backdrop of the facts of these cases, we are of the  opinion that the judgments and orders of the High Court  cannot be sustained on the premise that the High Court has  not addressed itself on the above-said two legal questions  raised by the appellant and, therefore, the impugned

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judgments and orders dated 25.01.2007 and 19.02.2007 are  set aside.  The interest of justice should be sub-served if the  matters are remitted to the High Court to decide the appeals  filed by the respondent against the appellant and criminal  miscellaneous petitions seeking for quashing the first  information reports registered against the respondent and his  wife by the police for commission of the offences stated in FIR  Nos.93 and 94 of 1998.  Needless to say that any observation  made by us in this judgment shall not be construed as an  expression of opinion on the merits of the cases, which shall  be decided by the High Court on their own merits in  accordance with law. The appeals shall stand disposed of in the aforesaid  terms.