Bangalore District Court
Narayanaswamy T.V vs S/O. Venkatarayappa on 16 January, 2016
IN THE COURT OF THE LXVIII ADDITIONAL CITY CIVIL
AND SESSIONS JUDGE, BENGALURU CITY (CCH-69)
Dated this the 16th day of January 2016
PRESENT:
Sri.Shivaji Anant Nalawade, B.Com., LL.B.(Spl)
LXVIII Addl. City Civil and Sessions Judge,
Bengaluru City.
CRIMINAL APPEAL No. 161/2014
APPELLANTS/ Narayanaswamy T.V.
ACCUSED : S/o. Venkatarayappa,
R/o. Thotaganahalli,
Nagamangala Post,
Shidlaghatta Taluk,
Chikkaballapur District.
(By Sri. Virupakshappa Byalihal,
Advocate)
- Versus -
RESPONDENT/ Nazeer Ahmed,
COMPLAINANT : Proprietor, M/s. Nicons,
Office at No.75/3/2,
8th Main, 3rd Block,
Jaya Nagar, Bengaluru - 560 011.
(By Sri. Yeshu Mishra, Advocate)
JUDGMENT
The appellant/accused has preferred this appeal under Sec.374(2) Cr.P.C. challenging the judgment passed by the XIII Addl. Chief Metropolitan Magistrate, Bangalore City, in C.C.11897/2008 dated 02-01-2014, wherein he has been convicted the accused for the offence punishable under Sec.138 2 Crl.Apl.No.161/2014 Negotiable Instruments Act and sentenced him to pay fine of Rs.15,05,000/- and in default of payment of fine shall undergo simple imprisonment for six months.
2. The appellant was the accused and respondent was the complainant before the trial court. For the sake of convenience, rank of parties is referred to as stood before the court below.
3. The brief facts leading for disposal of this appeal are as follows:
a) It is the case of the complainant that accused is a realtor approached him with an understating to procure 500 acres of land in and around villages of Nagamangala, Nallenahalli, Nadapanayakanahalli, Sajeevapur and Kolimi Hosur of Chikkaballapur Dist for the purpose of formation of the layouts and for construction of Villas entered into an agreement of Memorandum of understanding dt: 20/9/2007. As per the said MOU the accused received Rs. 10,00,000/- vide pay order No. 015340 dt: 10/9/2007 dawn on the Jammu & Kashmir Bank Ltd., and another Rs. 5,00,000/- by way of cash. But the appellant/accused failed to furnish the documents of title to the satisfaction of the respondent/complainant and failed to secure the lands as per the MOU and appellant/accused is liable to 3 Crl.Apl.No.161/2014 return the said sum of Rs. 15,00,000/- to him and in discharge of the said amount, the appellant/accused has issued 2 cheques bearing No. 036881 dt: 20/9/2007 for Rs. 10,00,000/- drawn on Jammu and Kashmir Bank Ltd., and cheque bearing No. 943621 dt: 26/10/2007 for Rs. 5,00,000/- dawn on Canara Bank, Sidlagatta. It is the case of the complainant that he presented the said cheque for encashment and same were dishonoured on 29/1/2008 and 6/1/2008 for insufficient funds in the account of the accused. Thereafter, he has intimated regarding dishonour of the cheque to the accused and called him to pay the cheque amount. The accused has not paid the amount. Thereafter he has issued Legal notice and called upon the accused to repay the cheque amount within 15 days from the date of receipt of the notice. Notice was served on the accused. The accused has not repaid the amount. Thereafter he has filed a private complaint before the trial court within limitation and thereby accused has committed the offence under Sec.138 of Negotiable Instruments Act.
4. After complainant has lodged the private complaint before the trial court, it has taken cognizance of the offence and kept the case for recording of sworn statement of the complainant. Thereafter, the trial court recorded sworn 4 Crl.Apl.No.161/2014 statement of the complainant and ordered to register a case against the accused for the offence punishable under Sec.138 N.I. Act and accused was summoned to appear before the court. Accused in pursuance of the summons appeared before the trial court through his counsel and he has been enlarged on bail. The copy of the complaint and other documents filed along with the complaint furnished to the accused. Thereafter, the trial court has framed accusation under Sec.251 Cr.P.C. for the offence punishable under Sec.138 of Negotiable Instruments Act and read-over the same to accused. Accused pleaded not guilty and claimed to be tried and thereafter case is posted for complainant's evidence. The complainant in order to prove the guilt of the accused got examined himself as PW.1. Complainant in support of his case produced 13 documents and got them marked as Ex.P1 to Ex.P13 and closed its side. Thereafter, the trial court has recorded Sec.313 Cr.P.C. statement of accused to enable him to explain incriminating circumstances appearing against him in the complaint witnesses. Accused denied the statement in toto and further stated that he has defence evidence. The accused is examined himself as DW.1. The accused in support of his case produced 9 documents and got them marked as Ex.D1 to Ex.D9 and closed its side. Thereafter 5 Crl.Apl.No.161/2014 case is posted for arguments. Thereafter the trial court has heard the arguments advanced by the counsel for accused and counsel for complainant and passed judgment on 02/02/2014 and convicted the accused for the offence punishable under Sec.138 of Negotiable Instruments Act and ordered to pay fine of Rs.15,05,000-00 to the accused and in default of payment of fine accused shall undergo simple imprisonment for six months.
5. The accused being aggrieved by the judgment and order passed by the trial court in C.C.11897/2008 dated 02-01- 2014 came in appeal on the following among other grounds;
The trial court has failed to appreciate the facts that when the breach of contract under the contract Act from one party, the other party was issued notice calling upon him to perform his part of contract, failing which he will present the cheque for realization and the complainant without giving any opportunity to the accused, the respondent/complainant presented Ex.P1 and P2 cheques for encashment without intimating him or asking him to why he has not coming forward to perform his part of the contractual obligation as per Ex.P12 which is bad in law. The trial court has failed to appreciate the fact that the accused has not issued Ex.P-1 and Ex.P2 cheque for legally recoverable debt. The trial court has not taken into consideration the fact that in 6 Crl.Apl.No.161/2014 the present case on hand there is MOU between the complainant and accused and there is no evidence adduced by the complainant to show that the accused failed to perform his part of contract and when there is no evidence in this regard, it cannot be said that the cheque issued by the accused on the date of entering into MOU are against legally enforceable debt as agreed. Trial court has not considered the fact that Ex.P-1 and 2 cheques are issued for security. So, provisions of Sec. 138 of Negotiable Instruments Act will not attract. The trial court has not appreciated the oral and documentary evidence on record and arrived at wrong conclusion. On these grounds, among other the appellant/accused prayed for allowing the appeal by setting aside the judgment and sentence passed by the trial court and prayed for acquitting the accused.
6. This appeal was presented before the Hon'ble City Civil & Sessions Judge, Bengaluru, it is registered as Criminal Appeal No.161/2014 and made-over to this court for disposal according to law. After the receipt of the records this court has issued notice to the respondent and the respondent appeared through his counsel. Thereafter the LCR's were secured and they are before the court.
7 Crl.Apl.No.161/2014
7. Heard the arguments advanced by the learned counsel for the appellant/accused and learned counsel for the respondent in length.
8. The points that arise for my determination are as under:
1. Whether the trial court has committed any error in coming to the conclusion that Ex.P1 and 2 are given for legally recoverable debt?
2. Whether the trial court has committed any error in not considering the defence of the accused that Ex.P1 and 2 cheques were issued for security purpose only and the provisions of Sec. 138 of Negotiable Instruments Act will not attract?
3. Whether interference is necessary in the impugned judgment and sentence under appeal from this court?
4. What order?
9. After hearing the arguments and on perusal of documents placed before me, my findings to the above points are as follows:
Point No.1 to 3 : In the Negative;
Point No.4 : As per final order
for the following;
8 Crl.Apl.No.161/2014
REASONS
10. POINT No.1 TO 3: The above points are inter-
connected, hence they are taken up for discussion together in order to avoid repetition.
11. In the present case, it is admitted by both complainant and accused that accused claiming to be a realtor approached the complainant with an understating to procure 500 acres of land in and around villages of Nagamangala, Nallenahalli, Nadapanayakanahalli, Sanjeevapur and Kolimi Hosur of Chikkaballapur District, for the purpose of formation of the layouts and for construction of Villas entered into a Memorandum of understanding dt: 20/9/2007. Further it is not in dispute that that accused has received Rs. 10,00,000/- and Rs. 5,00,000/- from the complainant for the said purpose. It is the case of the complainant that accused has not procure the lands as agreed in the MOU and so the accused for the purpose of returning the amount received by him has issued Ex.P1 and 2 cheques and said cheques were issued for repayment of legally recoverable debts. It is the case of appellant/accused that he was ready to perform his part of contract as per MOU. On the other hand complainant himself has not performed his part of contract. Ex.P1 and 2 cheques were not issued for legally 9 Crl.Apl.No.161/2014 recoverable debt. The said cheques were issued for security purpose, so provisions of Sec. 138 Negotiable Instruments Act is not attracted. In the present case it is not disputed by the accused that Ex.P1 and 2 cheques were presented for encashment within limitation and the same were dishonoued for 'Insufficient funds'. The only defence of the accused is that he has not issued Ex.P1 and 2 cheques for legally recoverable debt. The said cheques were given for security purpose on the date of execution of MOU itself. So, sec. 138 Negotiable Instruments Act will not attract.
12. In the present case complainant examined himself as PW-1 and PW-1 in his examination he has reiterated the averments of the complaint in his examination in chief. PW-1 has been cross-examined by the counsel for the accused and in the cross-examination PW-1 has stated as under :
"¤.¦. 12 zÁR¯ÁwAiÀÄ ªÀåªÀºÁgÀPÉÌ ¸ÀA§A¢ü¹zÀAvÉ £Á£ÀÄ DgÉÆæUÉ gÀÆ. 15 ®PÀëUÀ¼À£ÀÄß PÉÆnÖgÀÄvÉÛÃ£É JAzÀgÉ ¸Àp. ¸ÀzÀj gÉÆ. 15 ®PÀëUÀ¼À §ÁÀ§ÄÛ £Á£ÀÄ CzÉà ¢£ÀzÀAzÀÄ DgÉÆæ¬ÄAzÀ gÀÆ.10 ®PÀëUÀ½UÉ MAzÀÄ ZÉPÀÄÌ ºÁUÀÆ gÉÆ. 5 ®PÀëUÀ½UÉ E£ÉÆßAzÀÄ ZÉPÀÌ£ÀÄß ¨ÀszÀævÉUÁV ¥ÀqÉzÉ JAzÀgÉ ¸ÀjAiÀÄ®è. ¸ÁQë ¸ÀéAiÀÄA ºÉüÀÄvÁÛgÉ DgÉÆæ d«ÄãÀÄUÀ¼À£ÀÄß ¥ÀqÉzÀÄ £À£ÀUÉ PÉÆqÀ¢zÀÝ ¥ÀPÀëzÀ°è 10 Crl.Apl.No.161/2014 £Á£ÀÄ PÉÆlÖ ºÀtªÀ£ÀÄß »A¢gÀÄV¸ÀĪÀ ¸À®ÄªÁV ¸ÀzÀj ZÀPÀÄÌUÀ¼À£ÀÄß PÉÆnÖgÀÄvÁÛ£É."
13. From the above evidence of PW-1 given in his cross- examination it is clear that the PW-1 has denied that on the date of execution of MOU the accused have given 2 cheques as per Ex.P1 and 2. Further PW-1 voluntarily stated that the accused have given 2 cheques as per Ex.P1 and 2, in case if the accused has failed to purchase the land as per Ex.P12-MOU for return of the amount paid by him. Further PW.1 in his cross-examination stated as under:
"¤¦.12 gÀ°è F ZÀQÌ£À §UÉÎ £ÀªÀÄÆzÁV®è JAzÀgÉ ¸ÀjAiÀÄ®è. ¸ÁQë ¥ÀÅ£ÀB ºÉüÀÄvÁÛgÉ DgÉÆæ PÉÆlÖ ZÀQÌ£À §UÉÎ ¤¦.12gÀ°è £ÀªÀÄÆzÀÁVgÀĪÀÅ¢®è."
14. From the above evidence of PW-1 it is clear that PW- 1 firstly admitted that in respect of Ex.P1 and 2 cheques there is mention in Ex. P-12 document. Thereafter again PW-1 has stated that there is no mention regarding Ex.P 1 and 2 in Ex.P 12 document. Nothing has been made out in the cross- examination of PW.1 so as to help the accused to show that Ex.P1 and 2-cheques were given as security if the accused has not procured the land as per Ex.P12-MOU.
11 Crl.Apl.No.161/2014
15. Complainant in order to prove his case has produced original cheques given by accused which are at Ex.P1 and 2. Accused has not disputed that Ex.P1 and 2-cheques are from the cheque leaves books issued to him by his bankers. Further accused has not disputed that Ex.P1 and 2-cheques bears his signatures. Complainant has produced Memo given by the Jammu and Kashmir Bank and Canara Bank they are at Ex.P3 and 4. Complainant has also produced Cheque Deposit Memos they are at Ex.P5 and 6. Complainant has produced copy of legal notice which is at Ex.P7. Complainant has produced Postal acknowledgment which is at Ex.P11 and the said documents produced by the complainant clearly goes to show that the complainant has presented Ex.P1 and 2-cheques within limitation and said cheques were dishonoured for insufficient funds in the accounts of the accused. Further complainant has issued legal notice to the accused within limitation and called upon him to pay the cheque amount within 15 days from the ate of receipt and thereafter complainant has lodged the complaint before the trial court within limitation. Further complainant has produced Memorandum of Understanding executed between him and the accused which is at Ex.P12. accused has not disputed Ex.P12- documents. In Ex.P12 it is clearly recited that on the date of 12 Crl.Apl.No.161/2014 execution of said document, the accused has received Rs.10,00,000/- from the complainant for procuring the lands as mentioned in Ex.P12. Further it is the case of complainant that he has paid further Rs.5 lakhs by cash to the accused. The accused has also not disputed regarding the receipt of Rs.15 lakhs from the complainant. The only defence of the accused is that, on the date of execution of Ex.P12 itself, he has given Ex.P1 and 2-cheques as security and burden of proving the same is on the accused.
16. Accused in order to prove his defence examined himself as DW.1 and DW.1 in his evidence has stated regarding execution of Ex.P12-Memorandum of Understanding between him and the complainant. Further DW.1 has stated that, he has received Rs.15 lakhs from the complainant as per MOU for procuring the lands. Further DW.1 in his evidence stated that the complainant on the date of executing MOU insisted him to issue cheques for Rs.15 lakhs by way of security of the amount and he has paid two cheques to the complainant one for Rs.10 lakhs and another for Rs.5 lakhs. Further DW.1 has stated that the complainant has not performed his part of contract under Memorandum of Agreement. Complainant has not issued any notice to him for non performing the Memorandum of Agreement 13 Crl.Apl.No.161/2014 and presented the cheques for encashment which were given for security of the loan, so Sec.138 of Negotiable Instruments Act will not attract. The counsel for the complainant has cross- examined DW.1 and in the cross-examination DW.1 has admitted that Ex.P1 and 2-cheques were given by him to the complainant and the said cheques bears his signatures. Complainant has disputed that Ex.P1 and 2-cheques were given for security to him. It is the specific case of the complainant that, as accused has not procured the land as per MOU, the accused has given Ex.P1 and 2-cheques to him for returning the amount received by him at the time of executing Memorandum of Understanding. So, only interested version of DW.1 which is denied and disputed by the complainant itself will not show that Ex.P1 and 2-cheques were given for security purpose. Further perusal of Ex.P12-Memorandum of Understanding, nowhere discloses that there is mentioned in Ex.P12 regarding issuance of Ex.P1 and 2-cheques for security on the date of execution of the said document. It is the specific case of accused that on the date of executing Ex.P12, complainant has insisted for giving cheques for Rs.15 lakhs as security and he has given the said cheques and if really on the date of executing Ex.P12 the accused has given two cheques as per Ex.P1 and 2 to the 14 Crl.Apl.No.161/2014 complainant, the same ought to have mentioned in Ex.P12. There is no mention regarding giving of Ex.P1 and 2-cheques by the accused to the complainant in Ex.P12. So, the version of PW.1 that he has given Ex.P1 and 2-cheques to the complainant as security on the date of execution of Ex.P12 is unacceptable one.
17. Accused has produced the office copy of Notice issued by him to the complainant dated 07-11-2008. In the present case, Ex.P1 and 2-cheques are dated 20-09-2007 and 15-11-2007 and the complainant has presented the said cheques for encashment and the same were dishonoured and complainant has issued legal notice to the accused on 14-02- 2008 and intimated regarding dishonour of the cheque and called upon the accused to pay the cheque amount and accused has not replied to the said notice, so thereafter the complainant has presented the private complaint before the court on 11-04- 2008 and thereafter the accused has issued legal notice to the complainant on 07-11-2008 so Ex.D1-Notice is subsequent to the lodging of complaint, so the same will not help the accused to prove his defence. The accused has produced postal receipts and postal acknowledgment for issue of notice as per Ex.D1 they are Ex.D2 and 3 and the said documents also no where helps the 15 Crl.Apl.No.161/2014 accused to prove his defence. Accused has produced Agreement of Sale dated 27-06-2008 which is at Ex.D4, Agreement of Sale dated 19-02-2010 which is at Ex.D5, Agreement of Sale dated 27-06-2008 which is at Ex.D6, Agreement of Sale dated 21-08- 2008 which is at Ex.D7, Agreement of Sale dated 21-08-2008 which is at Ex.D8 and Agreement of Sale dated 12-09-2008 which is at Ex.D9. Accused has produced Ex.D4 to 9 to show that he was ready to perform his part of contract under Ex.P12- MOU. The complainant has presented the Ex.P1 and 2 for acknowledgment earlier to 14-02-2008 and on 14-02-2008 complainant has issued legal notice to the accused and intimated regarding dishonour of Ex.P1 and 2-cheques and called upon him to repay the cheque amount and thereafter when the complainant has lodged the private complaint before the trial court the accused has entered into the Agreement as per Ex.D4 to 9 to show that he has procured the lands as per MOU. So, Ex.D4 to 9 which are subsequent to the filing of the present case by the complainant against the accused, so the said documents no where helps the accused to prove his defence.
18. The counsel for the accused has submitted that the complainant has not issued any legal notice before presenting Ex.P1 and 2-cheques to the accused stating that he has not 16 Crl.Apl.No.161/2014 performed his part of contract under MOU, so Sec.138 of Negotiable Instruments Act will not attract. In the presents case, it is the specific case of the complainant that as per Ex.P12, the accused has not procured the land, so for return of the amount received under Ex.P12, accused has issued Ex.P1 and 2-cheques to him and he has presented the said cheques for encashment. Complainant no where admitted that Ex.P1 and2- cheques were given at the time of executing Ex.P12, so issuance of Notice for non-performing the act under MOU to the accused is not necessary. In the present case, except the interested version of DW.1 which is denied and disputed by the complainant, the accused has not produced any documentary evidence to show that Ex.P1 and 2-cheques were issued on the date of execution of Ex.P12 as security amount. Accused has admitted his signature on Ex.P1 and 2, accused has admitted regarding receiving of Rs.15 lakhs under Ex.P12, accused has not disputed that Ex.P1 and 2 were presented for encashment and the same were dishonoured, so presumption under Sec.139 of Negotiable Instruments Act attracts to Ex.P1 and 2 and burden shifts on the accused to rebut the said burden and accused has failed to rebut the said burden.
17 Crl.Apl.No.161/2014
19. The counsel for appellant has relied upon the judgment of Apex Court in Crl.Mis.1012/1999 dated 04-07-2006 in case M.S.Narayana Menon @ Mini Vs. State of Kerala, wherein the Hon'ble Apex Court has held that;
"Whether the evidence adduced by the parties before the trial court leading to one conclusion that the accused has discharged his initial burden, the burden shifts on the complainant to prove his case and if the complainant failed to prove his case to show that the cheques were not issued as a security, accused is entitled for acquittal."
20. Further the counsel for the appellant has relied upon the citation reported in ILR 2007 KAR Page 2709 (Case:
M.Senguttuvan Vs. Mahadevaswamy), wherein the lordship of our own Hon'ble High Court have held as under:
"Negotiable Instruments Act, 1881 - Section 138 - Offence under Sec.139 -
Presumption under-Rebuttal of-Order of acquittal-Appealed against - HELD, That the presumption under Sec.139 of the Act need not be rebutted only by leading defence evidence and the said presumption can be rebutted even on the basis of the facts elicited in the cross-examination of the complainant as has been done in the present case - Judgment of acquittal is justified."
21. Further the counsel for the appellant has relied upon the judgment of our own Hon'ble High Court in Crl.Appeal No.199/2009 dated 16-04-2009 (Case: Smt.H.R.Nagarathna Vs. 18 Crl.Apl.No.161/2014 Smt.Jayashree Prasad), wherein the lordship of Hon'ble High Court have clearly held that, cheque issued for security will not attract Sec.138 of Negotiable Instruments Act.
22. In the present case in hand, burden is on the accused to show that Ex.P1 and 2-cheques were issued as security on the date of executing Ex.P12-document and in the present case accused has failed to prove that Ex.P1 and 2- cheques were issued on the date of execution of Ex.P12. Accused has not rebutted the presumption under Sec.139 of Negotiable Instruments Act, so in the present case presumption under Sec.139 of Negotiable Instruments Act attracts. So, the contention of the counsel for the appellant that Sec.138 of Negotiable Instruments Act will not attract in the present case is unacceptable one.
23. The counsel for the respondent has relied upon the citation reported in 2015 AIR SCW 3040 in (Case: T. VAsanthakumar Vs. Vijayakumari) wherein the lordship of our Hon'ble Apex Court have held as under;
"Negotiable Instruments Act (26 of 1881), Ss.138, 139 - Dishonour of cheque -
Appeal against acquittal - Cheque as well as signature on it not disputed by accused respondent - Presumption under Sec.139 would be attracted - Story brought out by accused that cheque was given to complainant 19 Crl.Apl.No.161/2014 long back in 1999 as a security to a loan; the loan was repaid but complainant did not return security cheque - Is unworthy of credit, apart from being unsupported by any evidence -
Mere printed date on cheque by itself cannot be conclusive of fact that cheque was issued in 1999 - Order of High Court in acquitting accused is erroneous and set aside."
24. In the present case also the accused has failed to prove that Ex.P1 and 2-cheques were given on the date of execution of Ex.P12-MOU. The burden is on the accused to show that Ex.P1 and 2-cheques were given as security. Accused has failed to prove that Ex.P1 and 2-cheques were given as security. So, in the present case, provisions of Sec.138 of Negotiable Instruments Act attracts. So, the trial court has not committed any error in coming to the conclusion that Ex.P1 and 2-cheques are given for legally recoverable debt. Further the trial court has not committed any error in considering the defence of the accused in this case. The trial court has appreciated the oral and documentary evidence properly and arrived at a right conclusion, no interference is necessary in the judgment of the trial court from this court. Hence, for the above discussion, I answer point No.1 to 3 in the NEGATIVE.
25. POINT No.4: In view of my findings on point Nos.1 to 3 and reasons stated therein, I proceed to pass the following: 20 Crl.Apl.No.161/2014
ORDER The Criminal Appeal preferred by the appellant/accused is dismissed.
The judgment of the trial court, under appeal is confirmed.
Send back the LCR's along with the copy of judgment to the trial court.
(Dictated to the Judgment Writer, transcribed by her, corrected, signed and then pronounced by me in the open court on this the 16th day of January 2016).
(SHIVAJI ANANT NALAWADE) LXVIII Addl. City Civil and Sessions Judge, Bengaluru City.