PRITHVI CAPITAL Vs. ONALI BANDUKWALA

JUDGEMENT

(1.) This is an application for grant of leave to appeal. The accused have been acquitted for an offence punishable under Section 138 of Negotiable Instruments Act. A cheque in question was issued in the year 2003 for an amount of Rs. 8,00,000/-. The accused had taken a loan of Rs. 10,00,000/- which was given to them by two separate amounts of Rs. 8 lakhs and Rs. 2 lakhs. Thereafter there is a yearly confirmation of the balance amount which is due to the Complainant. The said documents are signed by both parties. A glance at the last document of confirmation which is dated 1.1.2002 indicates balance amount of Rs. 4,70,000/-. A glance on these documents also indicates that there is no reference of the interest paid. The case of the accused was that interest has been paid separately by cash. The Complainant in his cross-examination admitted that he was taking interest in cash but according to him that interest was in respect of some other transaction. The other transaction referred to in the cross-examination has however, not been brought on record. In the cross-examination, witness admitted that these transactions pertained to cash loan which was given to the accused. The Complainant's witness is a Chartered Accountant and once it is admitted by him that interest has been taken by way of cash then the absence of any entries in the interest paid column stand explained and at the very least, defence become probable. The correct procedure which is to be followed by the Complainant was to show outstanding interest and balance amount inclusive of interest. Instead of this procedure adopted, he is issuing confirmation letters for income tax purposes. If a larger amount inclusive of interest was due from the accused then this ought to have been shown in the confirmation letter as no tax could have been levied on the amount which has not been received. It was also the defence of the accused that a blank cheque was given when the loan was taken. The fact that amount of cheque is Rs. 8 lakhs which co-incide with the amount of Rs. 8 lakhs as a part of the loan is significant. Even if the alternate argument made on behalf of the complainant, to the effect that the cheque of Rs. 8 lakhs was given as a one time settlement and that it was a settlement for the amount of principal due alongwith interest, is accepted, yet there would be no acknowledgment in so far as interest amount is concerned within a period of limitation. That part of the interest which is beyond the period of limitation cannot be said to be legally enforceable debt. In this view of the matter, I find that this is not a fit case to interfere with in an appeal against acquittal. Hence leave refused. Consequently, appeal papers to be filed.