Prem Raj vs. Poonamma Menon

REPORTABLE 2024 INSC 260 IN THE SUPREME COURT OF INDIA CRIMINAL APPELLATE JURISDICTION CRIMINAL APPEAL NO………………OF 2024 (Arising out of Special Leave Petition (Crl.) No.9778/2018) PREM RAJ … APPELLANT(S) VERSUS POONAMMA MENON & ANR. …RESPONDENT(S) J U D G M E N T SANJAY KAROL, J. Leave granted. rd 2. Appellant herein challenges judgment and order dated 23 January, 2018 1 passed in Crl.R.P. No.1111 of 2011 , whereby the High Court of Kerala allowed, only in part, his Revision Petition against the judgment and order of the learned 2 th Additional Sessions Judge, Thrissur, dated 11 January, 2011, in Criminal Appeal No.673 of 2007, which, in turn, upheld his conviction, as handed down 3 th by the learned Judicial First Class Magistrate vide order dated 14 August, Signature Not Verified Digitally signed by Jayant Kumar Arora Date: 2024.04.02 17:43:20 IST Reason: 1 ‘Impugned Judgment’ 2 ‘Lower Appellate Court’ 3 ‘Trial Court’ 1 | SLP (Crl) 9778 of 2018 2007 in CC No.51 of 2003, under Section 138 of the Negotiable Instruments 4 Act, 1881. 3. The sole issue that we are required to consider is, whether, a criminal proceeding can be initiated and the accused therein held guilty with natural consequences thereof to follow, in connection with a transaction, in respect of which a decree by a competent Court of civil jurisdiction, already stands passed. 4. The facts necessary to put into perspective the issue in the present appeal are:- 4.1 The Appellant borrowed Rs.2,00,000/- from the Complainant, K.P.B Menon “Sreyes," with the promise that he would repay it on demand. th 4.2 On receipt of such demand, he issued a cheque dated 30 June, 2002 for the said amount from the South Indian Bank, encashment thereof was to be through Canara Bank, Irinjalakuda Branch, to which th the cheque was sent through the post with a covering letter dated 24 September, 2002. 4.3 It was dishonoured due to insufficient funds and ‘payments stopped by drawer’. The Complainant came to know of such dishonour and nd issued a notice of demand dated 22 December, 2002. Accounting for no action on the part of the appellant, the complaint, the subject matter of the instant proceedings, came to be filed. 4 ‘N.I. Act’ 2 | SLP (Crl) 9778 of 2018 5. Equally, though, the appellant (accused) had filed Original Suit No.1338 of 2002. The five parties impleaded as defendants were, (i) K.P. Bhaskara 5 Menon; (ii) K.P. Vipinendra Kumar ; (iii) Praveen Menon; (iv) The Manager South Indian Bank Limited Kathikudam, Via Koratty, Trichur; and (v) N.T. Raghunandanan. The prayers made therein were to, (a) declare cheque No.386543 of the South Indian Bank Limited, Kathikudam, as a security st cheque; (b) issue mandatory injunction directing the 1 defendant to return the said cheque; and (c) issue a permanent prohibitory injunction restraining defendants 1 to 4 named hereinabove from taking any steps to encash the said cheque. 5.1 The Additional District Munsif, Irinjalakuda, decreed the Suit on th 11 April, 2003 in favour of the plaintiff (accused). The Suit in respect of defendant No.4, namely the Manager, South Indian Bank, was dismissed and the Suit was wholly decreed against the remaining defendants. 5.2 Defendant No.1 filed an appeal before the Additional Subordinate th Judge, Irinjalakuda in C.M.A.No.6/2006. In its judgment dated 30 January, 2007, the Court observed that “ The lower court correctly analysed the facts and arrived at the right conclusion. I find no reason to interfere the order of the lower court. Hence I dismissed this appeal. ” nd 5 2 defendant 3 | SLP (Crl) 9778 of 2018 6. Therefore, it appears from the record that the very same cheque was in issue before the Civil Court and also the Court seized of the Section 138 N.I. Act complaint. The conclusions drawn by the Courts below, subject matter of the instant lis , are as under: 6.1 The Trial Court convicted the appellant herein to undergo simple imprisonment for one year as well as pay compensation of Rs.2 lakhs in default whereof, he was to undergo further simple imprisonment for six months. The determination of the issues, i.e., whether the decree passed by the Munsif Court would be binding on it, is of note. It was observed that a Court exercising jurisdiction on the criminal side is not subordinate to the Civil Court. Further, it was held “That order was an ex-parte order as far as criminal complaint is concerned the order of injunction issued cannot be granted and the hands of the criminal court cannot be fettered by the civil court”. 6.2 The First Appellate Court framed primarily one point for consideration – whether the cheque was issued against a legally enforceable debt, thereby attracting the offence under Section 138 of the N.I. Act. This point was held against the appellant and therefore, the conviction handed down by the Court below, accordingly confirmed. 4 | SLP (Crl) 9778 of 2018 7. The High Court, in revision, observed that no perversity could be indicated in the concurrent findings of the Trial Court and First Appellate Court. The same was dismissed. 8. We find the manner in which this matter has travelled up to this Court to be quite concerning. We fail to understand as to how a civil as well as criminal course could be adopted by the parties involved, in respect of the very same issue and transaction, in these peculiar facts and circumstances. 9. In advancing his submissions, Mr. K. Parameshwar, learned counsel appearing for the appellant, placed reliance on certain authorities of this Court. 6 In M/s. Karam Chand Ganga Prasad & Anr. vs. Union of India & Ors . , this Court observed that: “…….It is a well-established principle of law that the decisions of the civil courts are binding on the criminal courts. The converse is not true.” 7 In K.G. Premshanker vs. Inspector of Police & Anr ., a Bench of three 8 learned Judges observed that, following the M.S. Sheriff vs. State of Madras , no straight-jacket formula could be laid down and conflicting decisions of civil and criminal Courts would not be a relevant consideration except for the limited purpose of sentence or damages. 6 (1970) 3 SCC 694 7 (2002) 8 SCC 87 8 AIR 1954 SC 397 5 | SLP (Crl) 9778 of 2018 9 10. We notice that this Court in Vishnu Dutt Sharma vs. Daya Sapra (Smt.) , had observed as under: “26. It is, however, significant to notice a decision of this Court in Karam Chand Ganga Prasad v. Union of India (1970) 3 SCC 694, wherein it was categorically held that the decisions of the civil court will be binding on the criminal courts but the converse is not true, was overruled therein…” 10 This Court in Satish Chander Ahuja vs. Sneha Ahuja considered a numerous precedents, including Premshanker (supra) and Vishnu Dutt Sharma (supra), to opine that there is no embargo for a civil court to consider the evidence led in the criminal proceedings. The issue has been laid to rest by a Constitution Bench of this Court in Iqbal 11 Singh Marwah vs. Meenakshi Marwah :

9 (2009) 13 SCC 729 10 (2021) 1 SCC 414 11 (2005) 4 SCC 370 6 | SLP (Crl) 9778 of 2018

(Emphasis Supplied) 11. The position as per Premshanker (supra) is that sentence and damages would be excluded from the conflict of decisions in civil and criminal jurisdictions of the Courts. Therefore, in the present case, considering that the Court in criminal jurisdiction has imposed both sentence and damages, the ratio of the above-referred decision dictates that the Court in criminal jurisdiction would be bound by the civil Court having declared the cheque, the subject matter of dispute, to be only for the purposes of security. 12. In that view of the matter, the criminal proceedings resulting from the cheque being returned unrealised due to the closure of the account would be 7 | SLP (Crl) 9778 of 2018 unsustainable in law and, therefore, are to be quashed and set aside. Resultantly, the damages as imposed by the Courts below must be returned to the appellant herein forthwith. 13. The appeal is allowed in the aforesaid terms. Hence, the judgment and order passed by Additional Sessions Judge, Thrissur, in Criminal Appeal 673 of 2007, which upheld the conviction, as handed down by the learned Judicial First Class Magistrate in CC No. 51 of 2003, which came to affirmed by the High Court of Kerela in Crl.R.P.No.1111 of 2011 is quashed and set aside. Pending application(s), if any, shall stand disposed of. ……………………….J. (SANJAY KAROL) ……………………….J. (ARAVIND KUMAR) New Delhi April 02, 2024 8 | SLP (Crl) 9778 of 2018