The Andhra Pradesh High Court in the case M/s. Kakinada Chit Funds (P) Ltd v. Sri Chukkala Satyanarayana And Anr. observed and has upheld the acquittal of an accused as stated under Section 138 Negotiable Instrument Act criminal case since the civil court had adjudicated that only the amount of Rs. 25,000/- was due but the cheque dishonoured was of Rs. 75,000.
Thus, as the consequence of which, the important link was missing in evidence to connect the cheque for an amount of Rs. 75,000/- with that of legally enforceable debt pertaining to chit transaction.
It being the case of the complainant that the accused joined as a subscriber in one of the Chits conducted by complainant for the chit value for an amount of Rs. 1 lakh. It was also alleged before the court that the accused in the case did not pay the instalments after receiving the prize money in the auction. Thus, the accused in the case issued a cheque for an amount of Rs. 70,000/- which being towards part payment of chit due to complainant but it was dishonoured as ‘Exceeds Arrangement’.
Further, it has also been alleged before the court that after the legal notice is issued by the Complainant, the accused requested that the criminal case be not filed and has issued another cheque with an amount of Rs. 75,000 but the same also got dishonored with the same endorsement.
Therefore, the court observed that the complainant sent the legal notice again but the accused failed to pay the due amount and as the result of which, the complainant under section 138 of the of Negotiable Instrument Act was filed.
The Magistrate in the case found that the accused not guilty for the offence under section 138 of the Negotiable Instrument Act, 1881 and the unsuccessful complainant challenging the said judgement filed an appeal.
The counsel appearing for the Appellant or the Complainant N Siva Reddy contended before the court that the Magistrate erroneously held that there was no legally enforceable debt.
However, the counsel appearing for the respondent or accused K Kanaka Raju submitted before the court that the complainant did not file account copy before the trial Court to show the amount due by the accused and moreover, thus, the suit filed by the complainant before the Civil Court was adjudicated by holding that the amount due was only for an amount of Rs. 25,000/- and if that be the case, issuance of cheque for Rs. 75,000/- was highly doubtful.
The bench of Justice AV Ravindra Babu in the case observed that when the complainant filed a suit wherein seeking the huge amount, only an amount of Rs. 25,000/- was held to be due by the accused to the complainant’s company. There being no favourable order in civil appeal as well.
It has also been pointed out by the said court that the judgement of the Civil Court was binding on the Criminal Court and the complainant could not establish that the cheque was being issued towards discharge of a legally enforceable debt. Accordingly, the court dismissed the Criminal Appeal.
The counsel, N Siva Reddy appeared for the Appellant or Complainant.
The counsel, K Kanaka Raju represented the respondent or accused.