Cheque; P.K. Rajan Vs. K. Radhakrishnan [Kerala High Court, 15-07-2016]

Negotiable Instruments Act, 1881 – S. 138 – Cheque – Overwriting – Can mere overwriting on a digit in the amount entered in figures in a cheque amounts to material alteration, when there is no correction in the amount entered in words in the cheque? Held, When there is no corresponding correction or alteration in the amount entered in words in the Cheque, at any stretch of imagination, it could not have been considered as a material alteration.


IN THE HIGH COURT OF KERALA AT ERNAKULAM

B. KEMAL PASHA, J.

Crl. Appeal No. 237 of 2009

Dated this the 15th day of July, 2016

ST.161/2008 OF JUDICIAL FIRST CLASS MAGISTRATE COURT- II, OTTAPPALAM DATED 14-10-2008

APPELLANT(S)/COMPLAINANT

P.K. RAJAN

BY ADVS.SRI.JOHNSON P.JOHN SRI.BABY MATHEW

RESPONDENT(S)/ACCUSED

K. RADHAKRISHNAN AND ANOTHER

R1 BY ADV. SRI.T.K.AJITHKUMAR (VALATH) R2 BY PUBLIC PROSECUTOR SMT.MAYA

J U D G M E N T

# Can mere overwriting on a digit in the amount entered in figures in a cheque amounts to material alteration, when there is no correction in the amount entered in words in the cheque?

2. Challenging the judgment of acquittal passed by the Judicial First Class Magistrate’s Court-II, Ottappalam in S.T. No.161 of 2008, the complainant before the court below has come up in appeal.

3. The case before the court below is as a result of a private complaint filed by the appellant herein as complainant, against the 1 st respondent herein as accused, alleging an offence punishable under

# Section 138 of the Negotiable Instruments Act

4. The case of the complainant is that the accused borrowed an amount of ₹1,50,000/- from the complainant and when the complainant demanded the amount on 06.11.2006, the accused issued Ext.P1 cheque in discharge of the said liability. The said cheque, when presented, returned dishonoured for insufficiency of funds in the accounts of the accused. The complainant caused to issue Ext.P4 demand notice as contemplated under Section 138 (b) of the N.I.Act, which evoked response from the part of the accused in the form of Ext.P6 reply notice. Still, the amount has not been paid and hence the complaint.

5. The accused contended that the complainant is one of his relatives and he had borrowed an amount of ₹ 80,000/- from the complainant, out of which he had repaid an amount of ₹32,000/-. The balance amount due was only ₹48,000/-, which he had agreed to repay within one year.

6. On the side of the complainant, PW1 was examined and Exts.P1 to P6 were marked. On the side of the accused, the accused was examined as DW1. The court below found the accused not guilty of the offence under Section 138 of the N.I. Act, and acquitted him under Section 255(1) Cr.P.C. through the impugned judgment.

7. Heard the learned counsel for the appellant and the learned counsel for the 1 st respondent.

8. The learned counsel for the appellant has pointed out that the court below, by highlighting the overwriting on the digit “O” after the digits “15” in the amount entered in figures in Ext.P1, has thrown away the complaint and acquitted the accused by holding that it is a material alteration within the meaning of Section 87 of the N.I. Act. The learned counsel for the appellant has pointed out that the amount has been clearly entered in words in Ext.P1 as “Rupees one lakh fifty thousand only” and therefore, the mere overwriting on the digit “0” is of no significance at all and at any rate, the same could not have been treated as a material alteration within the meaning of Section 87 of the N.I. Act.

9. Per contra, the learned counsel for the first respondent has argued that the said correction in one of the digits in the amount entered in figures in Ext.P1 is nothing but material alteration within the meaning of Section 87 of the N.I. Act. In Ext.P1 the amount has been clearly entered in words as “Rupees one lakh and fifty thousand only”. The amount has been entered in figures also. It seems that in digit “0” after the digit “15”, there is overwriting. The question to be considered is whether it amounts to material alteration within the meaning of Section 87 of the N.I. Act? Section 87 of the N.I. Act clearly says that such an alteration should be a material alteration. Here, an overwriting can also be categorized as an alteration. At the same time, when the amount is clearly discernible and is written in bold letters in words as “one lakh and fifty thousand only”, the mere overwriting or correction in the digit “0” in the amount entered in figures in Ext.P1 cannot be treated as a material alteration within the meaning of Section 87 of the N.I. Act. Had there been any overwriting or corresponding correction in the amount entered in words in Ext.P1, it could have been said that it was an alteration of material nature as contemplated under Section 87 of the N.I. Act. When there is no corresponding correction or alteration in the amount entered in words in Ext.P1, at any stretch of imagination, it could not have been considered as a material alteration. It seems that the court below has unnecessarily passed a judgment of acquittal in this case.

10. From the cross-examination of DW1, it has clearly come out that he is a chronic defaulter, and several other litigations by way of money suits as well as complaints for the offence under Section 138 of the N.I. Act were pending against him. His versions that he had borrowed an amount of ₹80,000/- only, that too for no interest, and out of which he had repaid an amount of ₹32,000/- etc. can only be taken with a pinch of salt. This is a case wherein the complainant as PW1 has made out prima facie materials for inviting the presumptions under Sections 118(a) and 139 of the N.I. Act. The evidence adduced by DW1 is not at all helpful for rebutting the said presumptions.

11. The learned counsel for the first respondent has sought for an opportunity to the first respondent to rebut the presumptions available to the complainant. Whatever it is, the impugned judgment is devoid of merits and is only to be set aside and I do so.

In the result, this Criminal Appeal is allowed, and the impugned judgment of acquittal passed by the court below is set aside. The complaint is restored. remitted to the court below. The complainant is entitled to the presumptions under Section 118(a) and Section 139 of the N.I. Act. Merely for the purpose of giving one more opportunity to the first respondent to rebut those presumptions by adducing positive evidence, if any, if so advised, the case is remitted to the court below. The court below shall dispose of the matter expeditiously, at any rate, within a period of three months from the date of receipt of the records before the court below. The parties shall appear before the court below on 01-08-2016.

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