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H.K. Shaw Vs. Suresh Chandra Mitter - Court Judgment

LegalCrystal Citation
SubjectCriminal
CourtKolkata
Decided On
Reported inAIR1936Cal324,163Ind.Cas.232
AppellantH.K. Shaw
RespondentSuresh Chandra Mitter
Excerpt:
- .....was subsequently dishonoured.2. the case for the prosecution was that the complainant's firm, the atlas agency of 20 strand road, calcutta, cleared certain goods on behalf of the firm of m.l. shaw & co. ltd., of which the accused was the managing director, from k. p. dock no. 4 per s. s. 'clan macnair.' the complainant firm sent a bill, ex. 7, showing that the sum of rs. 264-15-0 was due in respect of these services rendered and for out of pocket payments in respect of customs duty and other charges. the bill was sent on 21st june 1934, and was acknowledged by the firm of m.l. shaw & co. ltd., on the same date. no payment was made, but on 2nd july 1934, bholanath mullick, an assistant in the firm of the atlas agency, met the accused and pressed him for payment. it is alleged that the.....
Judgment:

Lort-Williams, J.

1. In this case the appellant was convicted by a Presidency Magistrate of an offence under Section 420, Penal Code, and sentenced to be detained till the rising of the Court and to pay a fine of Rs. 600 in default six months' rigorous imprisonment. Out of the fine, if realized, Rs. 300 was to be paid to the complainant as compensation. The offence complained of was that of cheating the complainant's firm on or about 3rd July 1934, at Calcutta, by dishonestly inducing the said firm to deliver a bill, that is to say an invoice for Rs. 264-15-0, in exchange for a cheque No. A-7,55,136, upon the National Bank of India, which was subsequently dishonoured.

2. The case for the prosecution was that the complainant's firm, the Atlas Agency of 20 Strand Road, Calcutta, cleared certain goods on behalf of the firm of M.L. Shaw & Co. Ltd., of which the accused was the Managing Director, from K. P. Dock No. 4 per S. S. 'Clan Macnair.' The complainant firm sent a bill, Ex. 7, showing that the sum of Rs. 264-15-0 was due in respect of these services rendered and for out of pocket payments in respect of customs duty and other charges. The bill was sent on 21st June 1934, and was acknowledged by the firm of M.L. Shaw & Co. Ltd., on the same date. No payment was made, but on 2nd July 1934, Bholanath Mullick, an assistant in the firm of the Atlas Agency, met the accused and pressed him for payment. It is alleged that the accused then gave a cheque for the amount of the bill and Bholanath receipted the bill by writing upon it 'Received by cheque No. A-7,55,136.' Underneath that writing is a one anna revenue stamp which is cancelled by a rubber stamp with Atlas Agency upon it. Underneath that is the signature of B. Mullick.

3. The evidence shows that Bholanath's recollection is not accurate as to the date when the cheque was given. The accused stated that he gave a post dated cheque, and this is confirmed by the fact that in the counterfoil of the cheque book of the firm of M.L. Shaw & Co., the cheque to the Atlas Agency is dated 3rd July 1934, but the next cheque, in favour of the Electric Supply Corporation, is dated 28th June .1934. It seems reasonably clear, therefore, that the cheque was given to the Atlas Agency, either on the 28th, or prior to 28th June 1934. The cheque was dishonoured and returned on 4th July 1934. The complainant's firm then wrote to the firm of M.L. Shaw & Co., and received a reply regretting the dishonour of the cheque and asking the Atlas Agency to send their representative to receive payment of their bill on 9th July. But on this day no payment was made and, therefore, the complaint was lodged on 11th July 1934.

4. The defence was that the dispute was of a civil nature and that the firm of M.L. Shaw & Co. Ltd., had gone into liquidation, and that these criminal proceedings had been started to put pressure on the accused. M.L. Shaw & Co., went into liquidation about the middle of July 1934. The Magistrate came to the conclusion that these facts showed that the accused had an antecedent intention to defraud the complainant. But that is not the question which he had to decide. Section 420, Penal Code, provides that:

Whoever cheats and thereby dishonestly induces the person deceived to deliver any property to any person or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished....

5. The advocate, who has appeared on behalf of the complainant, has argued that what the accused did amounts either to inducing the complainant to deliver property to him, or to make a valuable security, or something which was signed, and which was capable of being converted into a valuable security. With regard to the first part of the argument the goods, which were the subject-matter of the clearing charges, had been delivered to M.L. Shaw & Co. Ltd., on or before 20th June 1934. It is clear, therefore, that the accused did not induce the complainant to deliver any property in exchange for the cheque, because the goods had already been delivered at an earlier date. It can hardly be contended that the piece of paper upon which the account is written is property within the meaning of this Section, or that the receipt is property within that meaning. The learned advocate relied more upon the second part of his argument and contended that the receipt is a valuable security within the meaning of Section 30, Penal Code. That section provides that:

The words 'valuable security' denote a document which is, or purports to be, a document whereby any legal right is created, extended, transferred, restricted, extinguished, or released, or whereby any person acknowledges that he lies under legal: ability, or has not a certain legal right.

6. The receipt does not extinguish or release any legal right. Until payment of these charges, the rights of the Atlas Agency against M.L. Shaw & Co. Ltd.. remain, and the giving of the receipt does not cancel or extinguish them. The receipt could be given in evidence to prove that the payment had actually been made, but it would always be open to the Atlas Agency to rebut this evidence by showing that in fact no payment had been received by them. Moreover, the receipt does not even purport to be an acknowledgment of payment. It amounts only to an acknowledgment that a cheque, No. A-7,55,136, has been received by the Atlas Agency. Even if the cheque had not been post dated, this receipt would not have amounted to any more than an acknowledgment that the cheque had been received, and it would always be open to the Atlas Agency to show that the cheque had never been paid. Still more is this so, when the cheque was post dated. In either case a cheque is only a promise to pay, either on demand, or upon the date to which it has been post dated. Therefore, the only effect of the receipt is an acknowledgment that a promise to pay has been given by M.L. Shaw & Co., to the Atlas Agency by means of the cheque in question. It is clear, therefore, that this receipt cannot even come within the last part of Section 30 which says 'whereby any person acknowledges that he lies under legal liability, or has not a certain legal right.'

7. The Atlas Agency, by writing 'received by cheque' on the back of the bill, did not acknowledge, that they had not a certain legal right. As I have already stated, all that they acknowledged was that they had received a promise to pay the money, which, if paid, would have extinguished their legal right to receive the amount, Rs. 264-15-0, stated upon the invoice.

8. It is clear, therefore, in my opinion, that the facts in this case do not support the charge made against the accused. His contention, that no crime has been committed, but that the Atlas Agency has rights against him in a civil Court is correct. The remedy of the complainant lies in a suit for breach of M.L. Shaw & Co.'s contract to pay the amount of the invoice or in insolvency proceedings. Consequently, the conviction and sentence are set aside, and the accused is acquitted. The fine, if paid, must be refunded.

Jack, J.

9. I agree.


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