CRL A/427/2017 of V.GOPAL, AGED 54 YRS Vs V.VIJAYAKUMAR on 12 November 2026

J U D G M E N T

The appeal challenges the judgment passed in C.A.No.61 of 2016, reversing the judgment of conviction passed against the respondent herein in __________

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CRL A No. 427 of 2017 C.C.No.178 of 2015 on the file of the learned Judicial Magistrate, Fast Track Court, Tiruppur.

2. It is the case of the appellant that the respondent borrowed a sum of Rs.6,00,000/- on 04.10.2011 for his business needs; that he executed a promissory note, promising to repay the said loan with interest at the rate of 12% per annum; that towards the discharge of the said liability, the respondent issued a cheque for a sum of Rs.6,18,000/- on 04.01.2012; that when the cheque was presented for collection on 08.02.2012, it was returned for the reason “Funds Insufficient”; that the appellant issued a legal notice to the respondent on 27.02.2012; that the respondent, through his lawyer, sent an interim reply making false allegations; and that the respondent failed to pay the cheque amount and thus committed the offence under Section 138 of the Negotiable Instruments Act, 1881. [hereinafter referred to as ‘N.I.Act’].

3. Before the trial Court, the appellant examined, himself as P.W.1, and his brother, one Viswanathan, as P.W.2 and marked Exs.P1 to P6. The respondent examined himself as D.W.1 and one Lokesh Kumar, an employee of Cholamandalam Finance Limited, as D.W.2 and marked Exs.D1 and D2.

4. The trial Court found that the appellant had established that the respondent had issued the cheque towards a legally enforceable debt; that the __________

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CRL A No. 427 of 2017 respondent had not denied his signature on the cheque; and that the cheque was returned for the reason “Funds Insufficient”. The trial Court, therefore, held that the appellant had proved the foundational facts and that the respondent had not rebutted the statutory presumption. Accordingly, the trial Court convicted the respondent for the offence under Section 138 of the N.I.Act and sentenced him to undergo simple imprisonment for one year and to pay a fine of Rs.1,000/-, and in default, to undergo further simple imprisonment for one month.

5. On the appeal filed by the respondent, the learned I Additional District and Sessions Judge, Tiruppur reversed the findings of guilt and acquitted the respondent on the ground that the appellant had not proved the execution of Ex.P1 and passing of consideration in the said transaction and therefore, the respondent was entitled to acquittal.

6. The learned counsel appearing for the appellant submitted that the findings of the lower Appellate Court are perverse; that the lower Appellate Court had reversed the well-considered judgment of the trial Court; that the respondent had not denied the signature either in Ex.P1 promissory note or in Ex.P2 cheque; that since the foundational facts had been proved, the burden was on the respondent to rebut the presumption, which he had failed to do; and that, therefore, the impugned judgment is liable to be set aside. __________

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CRL A No. 427 of 2017

7. The learned counsel appearing for the respondent, per contra, submitted that the appellant, who was examined as P.W.1, and his brother, P.W.2, had given contrary versions as to when and where Ex.P1 was prepared; that the appellant had not established his capacity to lend a sum of Rs.6,00,000/- in cash; that the appellant had misused Ex.P1 and Ex.P2, which were actually handed over to one Rajasekar of Cholamandalam Finance Limited, a friend of the appellant; and that the respondent had established those facts and consequently rebutted the statutory presumption. The learned counsel, therefore, submitted that the judgment of acquittal is justified and that there is no reason to interfere with the said judgment.

8. It is not in dispute that Ex.P1 promissory note was signed by the respondent. It is also not in dispute that Ex.P2 cheque was also signed by the respondent. The fact that the cheque was dishonored for the reason “Funds Insufficient” has been proved by the appellant.

9. The defence of the respondent was that both Ex.P1 and Ex.P2 were handed over to one Rajasekar, who was then working in Cholamandalam Finance Limited, to obtain a top-up loan. It is his further defence that a complaint was lodged against Cholamandalam Finance Limited and the said Rajasekar before the Superintendent of Police, Tiruppur. Though in the deposition, it is stated that the complaint was dated 20.03.2016, the learned __________

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CRL A No. 427 of 2017 counsel for the respondent would submit that it is a typographical error, and that the complaint was actually lodged in the year 2013, as seen from the receipt.

10. The respondent was examined as D.W.1. In his cross-examination, D.W.1 would state that the complaint lodged against Cholamandalam Finance Limited and Rajasekar had no connection with the instant complaint. It is not the case of the respondent that he had lodged any other complaint against Rajasekar or the appellant for the alleged misuse of Ex.P1 and Ex.P2.

11. The other ground raised by the respondent is that there are contradictions in the evidence of P.W.1 and P.W.2 as to where Ex.P1 was written and executed. The fact that it was executed in the house of the appellant is not disputed. The only contradiction is that P.W.1, the appellant herein states that Ex.P1 was prepared by the respondent and brought to his house. P.W.2, who is the witness to the said document, however, states that the document was prepared in the house of P.W.1. This is a very minor contradiction and would not discredit the evidence of P.W.1 and P.W.2. The said contradiction alone is not sufficient to hold that Ex.P1 was not executed by the respondent in favour of the appellant. Therefore, this Court is the view that the findings of the lower Appellate Court that the appellant had not established that Ex.P1 was executed for consideration is perverse and contrary to the evidence on record. The trial Court had considered all the above facts and held that the respondent had not __________

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CRL A No. 427 of 2017 rebutted the statutory presumption. Even in the reply notice sent by the counsel for the respondent, there is nothing to suggest that Ex.P1 and Ex.P2 were misused by the appellant. Though it is called as an interim reply, admittedly, the respondent had not sent any final reply. Therefore, this Court is the view that the impugned judgment is liable to be set aside and is set aside.

12. The respondent/accused is guilty of the offence under Section 138 of the N.I.Act, as rightly held by the trial Court. However, considering the fact that the transaction took place in the year 2011 and that the object of Section 138 of the N.I.Act is to compensate the complainant, this Court is inclined to modify the sentence imposed by the trial Court in the following manner :

13. The respondent/accused is sentenced to pay a sum of Rs.7,50,000/- (Rupees Seven Lakhs Fifty Thousand) and shall deposit the said amount within a period of four weeks from today, and in default, he shall undergo simple imprisonment for a period of three months. On deposit of the said fine amount, the appellant/complainant shall be paid compensation of Rs.7,50,000/-.

14. Hence, this Criminal Appeal is allowed. 12-11-2026 Index: Yes/No Speaking/Non-speaking order __________

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CRL A No. 427 of 2017 Neutral Citation: Yes/No ms __________

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CRL A No. 427 of 2017 To

1. The I Additional District and Sessions Judge, Tirupur.

2. The Judicial Magistrate, Fast Track Court, Tiruppur. __________

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CRL A No. 427 of 2017 SUNDER MOHAN J. ms CRL.A.No.427 of 2017 12-11-2026 __________

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