Deepak Bhatia v. Virender Singh

15. Mahesh Kumar, record clerk of Indian Overseas Bank, Greater Kailash Part-II did not know anything about the case and only produced the documents from the bank records.

16. The learned Magistrate convicted the petitioner under Section 138 ofthe Negotiable Instruments Act and sentenced him to undergo Rigorous Imprisonment for four months and a compensation under Section 357(3) Cr.P.C to the tune of Rs.3,11,250/- and in default of payment of compensation a Simple Imprisonment of 15 days. In the appeal filed by the petitioner, the conviction and sentence was upheld.

17. The petitioner submits that from the evidence on record, the respondent (complainant) has not been able to make out the existence ofa legal liability indischarge ofwhich the cheques were issued. That being the basic requirement of law, and the same not having been done by the respondent (complainant), the conviction ofthe petitioner is unwarranted. It has been submitted, on the other hand, that the petitioner has been successful in negativing the existence ofany such liability for which cheques had been issued. The other ground urged by the petitioner is that the undertaking (Ex.CW-l/Al) dated 12.9.2008 is for a consolidated amount of Rs.24 lakhs and odd. But the cheques in question are all of subsequent dates and of smaller amounts. Itwas argued that such smaller amount ofcheques, issued by Crl.Rev.P.400/2015 Page 8of19 J the petitioner, defy the natural course ofconduct. It is not expected of anybody to issue many cheques of such amount especially when the outstanding loan amount is as high as 24 lakhs and odd. This only implies, that no such transaction as stated in the notice or the complaint ever took place.

18. Agrievance has been laid that in the complaint, the exact loan amount has not been stated. The figure of24,73,867/- has been arrived at only on the basis of an undertaking and by calculating the amounts in different cheques which were purportedly issued by the petitioner. There is no mention ofsuch amounts in the Income Tax returns ofthe complainant. In that view ofthe matter, it was argued, the case ofthe respondent (complainant) becomes highly doubtful and ambiguous. and is not fit to be accepted.

19. The petitioner in his 313 statement has admitted issuance of cheques and its subsequent dishonour on presentation in the bank for insufficiency of funds.

20. The ground ofthe respondent (complainant) indulging in money lending without alicense does not come handy and beneficial to the petitioner. Any repayment ofloan by cheque would not be covered by Punjab Registration ofMoney Lending Act, 1938.

21. The statement ofaccounts furnished by DW-2 and DW-2A also do not show that the respondent (complainant) was lending money to various people. Otherwise dso the bar of Section 3 of the Punjab Registration ofMoney Lending Act, 1938 would not be applicable in case ofreturn ofany loan through anegotiable instrument like cheque. Crl.Rev.P.406/2015 9of19 "O I «5. Suits and applications by money-lenders barred, unless money-lender is registered and licensed. Notwithstanding anything contained in any other enactmentfor the time being in force, a suit by a money lenderfor the recovery ofa loan, or an application by a money-lender for the execution ofa decree relating to a loan, shall after the commencement of this act, be dismissed, unless the money-lender- (a)At the time ofthe institution ofthe suit orpresentation ofthe applicationfor execution-

(i) is registered; and

(ii) holds a valid licence, in suchform and manner as may beprescribed; or

(Hi) holds a certificate from a Commissioner granted under section 11, specifying the loan in respect of which the suit is instituted, or the decree in respect ofwhich the applicationfor execution is presented; or

(iv) ifhe is not a registered and licensed money-lender, satisfies the Court that he has applied to the Collector to be registered and licensed and that such application is pending; provided that in such a case, the suit or application shall not befinally disposed of until the application of the money lenderfor registration andgrant oflicensepending before the Collector isfinally disposed of "

22. The contention ofthe petitioner that the cheques were offered as security which was meant to be returned after the loan was repaid, is not acceptable. The deposition ofthe petitioner is categorical that he met the respondent (complainant) in the year 2006 and had taken a loan from him. The loans were being repaid, according to the petitioner, till 2008. Thus, the acknowledgement contained in Ex.CW- 1/lA which the petitioner made on 12.9.2008, thereby admitting Crl.Rev.P.400/2015 Page 10 of19.J J receipt ofRs.24 lakhs and odd demonstrates thatthe loanwas takenby the petitioner. The aforesaid acknowledgement also admits ofthe fact that many cheques of different amounts were issued on various dates and an assurance was given vide that acknowledgement that the total amount would be paid by the last week ofDecember, 2008.

23. The appellant as DW-1 has admitted that each of the cheque was of different amount which included the amount of interest. The fact that cheques were issued for the amount which included the interest clearly demonstrates that the cheques were not security cheques. It is not expected that payment ofthe dues would be made by anybody without taking the cheques back from the party.

24. Though interest at the rate of 20% per month, (240% per annum) on the face of it, appears to be unconscionable, but, when there is extreme/urgent need of money and loan is taken for a short period, it is not unknown in the mercantile world that bigger rate of interest is charged. In such an event, higher rate of interest cannot, ipso facto, lead to the conclusion that the cheques were only security cheques and not issued in discharge of any existing liability of the payer. The revisionist has admitted that such amounts were being paid regularly i.e. principal amount along with 20% interest from 2006 to

2008. The petitioner would, therefore, be estopped from raising the plea that such rate ofinterest was on the excessive side, and therefore the prosecution case is doubtful.

25. In the cross examination, the petitioner has admitted that the cheques were filled up by him in his own handwriting. The dates also Crl.Rev.P.400/2015 11 of19 were filled by him. Only the name ofthe drawer was left blank.

26. Thus the argument that the cheques being of smaller amounts and for a short period oftime is reflective ofthe same being in the nature ofsecurity is untenable.

27. The appellate Court, therefore, upheld the conviction and sentence ofthe petitioner.

28. This Court finds no fault with both the orders of the Courts below.

29. An alternative plea has been taken by the petitioner that in 23 complaints, separate sentences and compensation has been awarded to the petitioner and there is no stipulation that those sentences will run concurrently.

30. It is submitted that since the transaction was between the same parties, though each loan transaction was separate and distinct, the sentences should have been directed to run concurrently. It was suggested by the petitioner that the legal position favours the exercise of discretion for the benefit of an accused in cases where prosecution is based on a single transaction even if different complaints thereof may have been filed for dishonour of different cheques. The transactions forming the basis ofprosecution relate to the same parties i.e the petitioner and the respondent and therefore the sentences ought to have been ordered to run concurrently.

31. In Mohd.Akhtar Hussain vs. Assistant Collector of Customs (1988) 4 see 183, the Supreme Court recognized and justified the Crl.Rev.P.400/2015 of19 principle of concurrent running of sentences. It has been held by the Supreme Court that "the basic rule ofthumb over the years has been the so called single transaction rule for concurrent sentences. If a given transaction constitutes two offences under two enactments generally, it is wrong to have consecutive sentences. It is proper and legitimate to have concurrent sentences. But this rule has no application ifthe transaction relates to offences which are not same or the facts constituting thetwooffences arequite different."

32. In State of Punjab vs. Madan Lai, 2009 (5) SCC 238, the Supreme Court relied upon the aforementioned decision in Akhtar Hussain's case (Supra) and affirmed the direction of the High Court for sentences to run concurrently.

33. Incidentally, Madan Lai's case also was under Section 138 of the Negotiable Instruments Act.

34. In V.K.Bansal vs. State of Haryana and Ors, AIR 2013 SC 3447, the Supreme Court again took note of the aforestated decisions and put its seal of approval over the proposition of concurrent running ofsentences in cases relating to same transaction.

35. However, in O.M.Cherian @ Thankachan vs. State of Kerala and Ors, (2015) 2 SCC 501, the Supreme Court had the occasion to refer to the decision in Mohd.Akhtar and Madan Lai (Supra).

36. In the aforesaid decision, a reference was made to Section 31 of the Code of Criminal Procedure which reads as hereunder:- J'.

(3) For the purpose ofappeal by a convicted person, the aggregate of the consecutive sentences passed against him under this section shall be deemed to be a single sentence."

37. A reading of Section 31 Cr.P.C, it was argued before the Supreme Court, would make it. obvious that the normal rule is to inflict sentences which would run consecutively and only when specially directed, concurrently.

38. The Supreme Court after analyzing the provisions ofSection 31 ofthe Code of Criminal Procedure clarified that the section deals with Crl.Rev.P.400/2015 Page 14 of19 quantum ofpunishment which may be legally passed when there is (a) one trial; and (b) the accused is convicted of"two or more offences." Section 31 Cr.P.C. says that subject to the provisions of Section 71 I.P.C., the Court may pass separate sentences for two or more offences, but the aggregate punishment must not exceed the limits fixed in proviso (a) and (b) ofsub-section (2) ofSection 31 Cr.P.C. Theambit of Section 31 is wide, covering not only a single transaction constituting two or more offences but also offences arising out oftwo or more transactions. Thus in Mohd.Akhtar Hussain and Madan Lai (Supra), the issue that fell for consideration was imposition of sentences for two or more offences arising out of single transaction. It was in that context that sentences were directed to run concurrently.

39. In O.M.Cherian (Supra) the Supreme Court at para 20 and 21 clearly laidthe formulation as under:- "20. Under Section 31 Cr.P.C. it is left to the full discretion of the Court to order the sentences to run concurrently in case of conviction for two or more offences. It is difficult to lay down any straitjacket approach in the matter of exercise of such discretion by the courts. By andlarge, trial courts andappellate courts have invoked and exercised their discretion to issue directionsfor concurrent running of sentences, favouring the benefit to be given to the accused. Whether a direction for concurrent running of sentences ought to be issued in a given case would depend upon the nature of the offence or offences committed and the facts and circumstances of the case. The discretion has to be exercised along the judicial lines and not mechanically.

21. Accordingly, we answer the Reference by holding that Section 31 Cr.P.C. leavesfull discretion with the Court to order sentences for two or more offences at one trial to run concurrently, having regard to the nature of offences and attendant aggravating or mitigating circumstances. We do notfind any reason to hold that normal rule is to order the sentence to be consecutive and exception is to make the sentences concurrent. Ofcourse, ifthe Court does not order the sentence to be concurrent, one sentence may run after the other, in such order as the Court may direct. "

40. In the case in hand what the Trial Court and the appellate Court lost sight of was the provision of Section 31(2) of Cr.P.C and Section 71 of the IPC.

41. Section 71 of the IPC reads as hereunder:- "77. Limit of punishment of offence made up of several offences.—Where anything which is an offence is made up ofparts, any ofwhich parts is itself an offence, the offender shall not be punished with the punishment of more than one of such his offences,.unless it be so expresslyprovided. [Where anything is an offence falling within two or more separate definitions of any law in force for the time being by which offences are defined or punished, or where several acts, ofwhich one or more than one would by itself or themselves constitute an offence, constitute, when combined, a different offence, the offender shall not be punished with a more severe punishment than the Court which tries him could awardfor any one ofsuch offences.] Illustrations (a) A gives Z fifty strokes with a stick. Here A may have committed the offence ofvoluntarily causing hurt to Z by the whole beating, and also by each of the blows which make up the whole beating. If A were liable to punishment for every blow, he might be Crl.Rev.P.400/2015 Page 16of 19 imprisonedforfifty years, onefor each blow. But he is liableonly to onepunishmentfor the whole beating. (b) But if while A is beating Z, Yinterferes, and A intentionally strikes Y, here, as the blow given to Yis no part ofthe actwhereby Avoluntarily causes hurtto Z, A is liable to one punishment for voluntarily causing hurt to Z, and to anotherfor the blow given to Y"

42. The sentence of four months if added up in 23 complaints would make it 92 months which makes the sentence approximately of eight years. In such an event, the judgment ofthe Trial Court and the appellate Court, therefore, reflect lack ofproper exercise ofdiscretion. Though in the operative part ofthe sentence oftheTrial Court there is no reference of sentences imposed under the various complaintsto run concurrently, the Trial Court allowed the application under Section 389 Cr.P.C of the petitioner for suspension of sentence till the filing of the appeal. This obviously, is lack of sight on the part of the Court to assess that the sentences in 23 complaints were not to run consecutively; or else the prayer under Section 389 Cr.P.C would not have been allowed.

43. The nominal roll of the petitioner shows that the sentences are to run consecutively in all the cases. This is because, there is no clarificationwith respect to whetherthe sentences in all the complaints would run consecutively or concurrently.

44. The Appellate Court also lost sight ofthis fact.

45. Thus on the basis of the aforesaid discussion, the sentences imposed upon the appellant in all the cases is directed to run Crl.Rev.P.400/2015 Page 17of 19 concurrently and notconsecutively.

46. In case the appellant has served the sentence of four months in all, he will be released from jail forthwith.

47. It has been argued that while sentencing the appellant the Tnal Court directed the appellant to pay compensation under Section 357(3) Cr.P.C to the complainant to the tune of Rs.1,43,250/- and further directed that in default ofpayment ofcompensation, the convict shall undergo imprisonment for 15 days.

48. In Ahammedkutty vs. Abdullakoya, 2009 (6) SCC 660, the Supreme Court has categorically held that compensation can be directed to be paid both in terms of sub Section (1) of Section 357 of Cr.P.C and under sub Section (3) thereof However, while exercising jurisdiction under sub-Section (3) of Section 357, no direction could be given that in default to pay the amount of compensation, the accused shall suffer Simple Imprisonment.

49. The Supreme Court has held that such an order could have been passed only in terms of Sub Section (1) of Section 357. If the compensation directed to be paid by the Court in exercise of its jurisdiction under sub Section (3) of Section 357 is not deposited, the same can be realised as fine in terms of Section 421 of the Code of Criminal Procedure.

50. Thus the default clause inserted in the sentences requiring the appellant to suffer Simple Imprisonment for 15 days in case of non payment ofthe compensation amount cannot be sustained in the eyes of law and therefore that part ofthe sentence is setaside. Crl.Rev.P.400/2015 Page 18 of19 IP

51. It is made clear that no interference is being made with respect to the quantum of compensation which the petitioner has been directed to pay to the complainant.

52. The revision petition is thus disposed of in terms of the above namely the sentences in all the complaints would run concurrently and there shall no imprisonment for non payment of the compensation amount, which amount could be realised under Section 421 of the Code of Criminal Procedure, CrI.M.B No.7311/2015

1. In view of the petition having been disposed of, no order is required to be passed in the instant application.

2. Dismissed as infructuous. vi SEPTEMBERI 2015 k ASHUTOSH KUMAR, J