Bangalore District Court
Sri.H.G. Prakash vs Smt. Jayamma on 4 January, 2022
1
C.C.No.15769/17 J
IN THE COURT OF THE XVI ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE, BENGALURU CITY
Dated: This the 4th day of January 2022
Present: Sri.S.B.HANDRAL, B.Sc., L.L.B(SPL).,
XVI Addl.C.M.M., Bengaluru City.
JUDGMENT U/S 355 OF Cr.P.C.,
Case No. : C.C.No.15769/2017
Complainant : Sri.H.G. Prakash,
S/o. Ganga Hanumaiah,
Aged about 45 years,
R/a No.13/A, 3rd Cross,
R.K.Mutt Layout,
K.G.Nagar,
Benglauru 560 019.
(By Sri. H.Shivananda,
K.S.Raghavendra and others.,
Advs.)
Vs
Accused : Smt. Jayamma,
Aged about 58 years,
R/at No.34, 2nd Floor,
1st Main Road,
Cauverynadi Road,
Brundhavananagara,
Bengaluru 560 019.
Working as Attender,
2
C.C.No.15769/17 J
Room No.36,
Ground Floor,
Vidhana Soudha,
Benglauru 560 001.
(By Sri.M.Krishne Gowda, Adv .,)
Case instituted : 7.6.2017
Offence complained : U/s 138 of N.I Act
of
Plea of Accused : Pleaded not guilty
Final Order : Accused is convicted
Date of order : 4.1.2022
JUDGMENT
The Complainant has filed this complaint against the Accused for the offence punishable u/Sec.138 of the Negotiable Instruments Act.
2. Briefly stated the case of the Complainant is that, the accused in the month of December 2016 had borrowed a sum of Rs.3 Lakhs from him as hand loan to solve her domestic problems and promise him to repay the said amount within three months, inspite of undertaking and promise the accused failed to repay the amount borrowed but after his 3 C.C.No.15769/17 J repeated requests and demand the accused had issued the cheque bearing No.564915 dt: 27.4.2017 for Rs.3 Lakhs drawn on The Karnataka State Co operative Apex Bank, Vidhana Soudha Branch, Bangalore. The complainant further contends that, he has presented the said cheque through his banker I.e Vijaya bank, Gandhi Bazar Brnch, Bangalore but the said cheque came ot be returned dishonoured for the reason "Funds Insufficient' vide endorsement dt: 28.4.2017, and inspite of bringing the said fact to the notice of the accused but she has not made any arrangement for making payments, hence he was constrained to issue legal notice dt; 10.5.2017 calling her to pay the cheque amount within 15 days from the date of receipt of notice and also sum of Rs.5,000 towards professional charges for issue of legal notice and the said notice has been served on the accused on 15.5.2017 to the office address and another notice was returned as "No such number in Kauverinadi Road, Not known, hence returned to sender", inspite of that, the accused has not complied with the demand made in the notice. Hence he has filed this present complainant against the Accused for the 4 C.C.No.15769/17 J offence punishable U/s.138 of Negotiable Instruments Act.
3. Before issuing process against the accused, the Complainant has filed his affidavitinlieu of his sworn statement, in which, he has reiterated the averments made in the complaint. In support of his evidence, P.W.1 has relied upon the documentary evidence as per Ex.C.1 to C.10 i.e, Original Cheque dated: 27.4.2017 is as per Ex.C.1 the signature on the said cheques identified by P.W.1 is that of the accused as per Ex.C.1(a), the Bank Memo as per Ex.C.2, the office copy of Legal Notice as per Ex.C.3, postal receipts as per Ex.C.4 and 5, postal acknowledgement as per Ex.C.6 returned legal notice as per Ex.C.7, RPAD Cover as per Ex.C.8, postal receipt as per Ex.C.9, postal acknowledgement as per Ex.C.10.
4. Primafacie case has been made out against the accused and summons was issued against the accused in turn has appeared before the court and got enlarged on bail and the substance of the 5 C.C.No.15769/17 J accusation has been read over to her, to which she pleaded not guilty and claims to be tried.
5. As per the direction of the Hon'ble Apex Court in the decision of the Indian Bank Association Vs., Union of India, reported in 2014 (5) SCC 590, after recording the plea of the Accused, as she intended to set out her defence, then the case was posted for the crossexamination of complainant, after his cross examination, the complainant was closed his side.
6. Thereafter, the statement of the accused as required under Sec.313 of the Cr.P.C. has been recorded. She has denied the incriminating evidence appearing against her and has chosen to lead her rebuttal evidence subsequently the Accused herself examined as DW.1 and during the course of cross examination of PW.1, the accused has confronted Tax invoice as per Ex.D.1 and T.V. warranty card issued by Adishwara Electronics Shop., as per Ex.D.2 and at the time of her evidence has produced statement of account pertains to her account as per 6 C.C.No.15769/17 J Ex.D.3 and letter submitted to the Manager of Apex Bank, Vidhana Soudha Branch, Bangalore dt; 16.9.2019 as per Ex.D.4 and accused has also examined her son by name one Sri.Manjunath as DW.2 and closed her side.
7. Heard by learned counsel for the complainant and the Accused and perused the written argument submitted by the learned counsel for the accused. Perused the decisions relied upon by the learned counsel for the complainant 1. Crl.Appeal No.271/2020, 2) Crl.Appeal No.1545/2019 3) Judgment in C.C.No.12359/2019 4) (2015) 17 SCC 368 and The decisions relied upon by the learned counsel for the accused i.e.,1) (2020) 15 SCC 348,
2) (2019) 5 SCC 418; 3) (2015) 1 SCC 99, 4) (2006) 6 SCC 39, 5) 2012 (3) Hon'ble High Court of Karnataka case KCCR 2057) Circuit Bench, Dharwad ; 6) ILR 2008 KAR 4629 7) 2015 (5) KCCR 990, 8) 2015(5) KCCR 914, 9) (2008) 4 SCC 54.
7C.C.No.15769/17 J
8. On the basis of complaint, evidence of complainant and documents the following points that are arise for consideration are:
1. Whether the complainant proves that the accused has issued cheque bearing No.564915 dt: 27.4.2017 for Rs.3 Lakhs drawn on The Karnataka State Cooperative Apex Bank, Vidhana Soudha Branch, Bangalore, discharge legally recoverable debt to the complainant and when the complainant has presented cheque for encashment through his banker but the said cheque have been dishonoured for the reasons "
Funds Insufficient " on 28.04.2017 the complainant issued legal notice to the accused on 10.5.2017 and inspite of it the accused has not paid the cheque amount within prescribed period there by the accused has committed an offence U/s.138 of the Negotiable instruments Act?
2. What Order?
9. The above points are answered as under:
Point No.1: In the Affirmative Point No.2: As per final order for the following:8
C.C.No.15769/17 J .
REASONS
10. Point No.1: Before appreciation of the facts and oral and documentary evidence of the present case, it is relevant to mention that under criminal jurisprudence prosecution is required to establish guilt of the Accused beyond all reasonable doubts however, a proceedings U/s.138 of N.I.Act is quasi criminal in nature. In these proceedings proof beyond all reasonable doubt is subject to presumptions as envisaged U/s.118, 139 and 136 of N.I.Act. An essential ingredient of Sec. 138 of N.I.Act is that, whether a person issues cheque to be encashed and the cheque so issued is towards payment of debt or liability and if it is returned as unpaid for want of funds, then the person issuing such cheque shall be deemed to have been committed an offence. The offence U/s.138 of N.I. Act presupposes conditions for prosecution of an offence which are as under:
1. Existence of legally enforceable debt or liability and issuance of cheque in discharge of said debt or liability;9
C.C.No.15769/17 J
2. Cheque shall be presented for payment within specified time i.e., from the date of issue before expiry of its validity.
3. The holder shall issue a notice demanding payment in writing to the drawer within one month from the date of receipt of information of the bounced cheque and
4. The drawer inspite of demand notice fails to make payment within 15 days from the date of receipt of such notice.
If the above said conditions are satisfied by holder in due course gets cause action to launch prosecution against the drawer in respect of bounced cheque and as per Sec.142(b) of the N.I. Act, the complaint has to be filed within one month from the date on which cause of action arise to file complaint.
11. It is also one of the essential ingredient of Sec. 138 of N.I.Act that, a cheque in question must have been issued towards legally recoverable debt or liability. Sec. 118 and 139 of N.I.Act envisages 10 C.C.No.15769/17 J certain presumptions i.e., U/s.118 presumption shall be raised regarding 'consideration' 'date' 'transfer' 'endorsement' and holder in course of Negotiable Instrument. Even Sec.139 of the Act are rebuttable presumptions shall be raised that, the cheque in question was issued regarding discharge of a legally recoverable or enforceable debt and these presumptions are mandatory presumptions that are required to be raised in cases of negotiable instrument, but the said presumptions are not conclusive and are rebuttable one, this proportion of law has been laid down by the Hon'ble Apex Court of India and Hon'ble High Court of Karnataka in catena of decisions.
12. In the present case the complainant/PW.1 in her complaint and affidavit evidence has testified that, the accused in the month of December 2016 had borrowed a sum of Rs.3 Lakhs from him as hand loan to solve her domestic problems and promise him to repay the said amount within three months, inspite of undertaking and promise the accused failed to repay the amount borrowed but after his 11 C.C.No.15769/17 J repeated requests and demand the accused had issued the cheque bearing No.564915 dt: 27.4.2017 for Rs.3 Lakhs drawn on The Karnataka State Co operative Apex Bank, Vidhana Soudha Branch, Bangalore. The complainant/PW.1 further testified that, he has presented the said cheque through his banker ie., Vijaya Bank, Gandhi Bazar Branch, Bangalore but the said cheque came ot be returned dishonoured for the reason "Funds Insufficient' vide endorsement dt: 28.4.2017, and inspite of bringing the said fact to the notice of the accused but she has not made any arrangement for making payments, hence he was constrained to issue legal notice dt; 10.5.2017 calling her to pay the cheque amount within 15 days from the date of receipt of notice and also sum of Rs.5,000 towards professional charges for issue of legal notice and the said notice has been served on the accused on 15.5.2017 to the office address and another notice was returned as "No such number in Kauverinadi Road, Not known, hence returned to sender", inspite of that, the accused has not complied with the demand made in the notice.
12C.C.No.15769/17 J
13. In support of his evidence, P.W.1 has relied upon the documentary evidence as per Ex.C.1 to C.10 i.e, Original Cheque dated: 27.4.2017 is as per Ex.C.1 the signature on the said cheques identified by P.W.1 is that of the accused as per Ex.C.1(a), the Bank Memo as per Ex.C.2, the office copy of Legal Notice as per Ex.C.3, postal receipts as per Ex.C.4 and 5, postal acknowledgement as per Ex.C.6 returned legal notice as per Ex.C.7, RPAD Cover as per Ex.C.8, postal receipt as per Ex.C.9, postal acknowledgement as per Ex.C.10.
14. In the present case, there is no dispute between the complainant and Accused with respect to their acquittance and the accused has also not disputed the cheque in question i.e. Ex.C.1 belong to her account and her signature found at Ex.C.1(a). The accused has also not disputed that, the cheque in question presented for encashment within its prescribed period and dishonoured for the reason of "Funds Insufficient" on 28.4.2017 hence as a matter on record, proved by return memo dated:
13C.C.No.15769/17 J Ex.C.2 issued by the concerned bank, therefore it is a matter on record and has been proved that, the cheque in question was presented within its validity period and dishonoured as per the bank endorsement issued by the banker of accused.
15. In relation to the service of notice the accused in her defence has denied the service of notice upon her. The complainant in order to prove service of notice has produced the documents i.e copy of the legal notice, postal receipts, postal acknowledgement, copy of returned notice and RPAD cover with postal receipt and postal acknowledgement which are at Ex. C.3 to C.10 respectively. On perusal of the Ex.C.3 to C.10 it appears that, on 10.5.2017 the complainant has issued legal notices to office and residential address of the accused and same were sent through RPAD. It is also seen from Ex.C.6 that, the legal notice was served on the accused ie., which was sent to the office address of the accused. The office address of the accused shown as "Room No.36, Ground Floor, Attender, Vidhana Soudha, Bangalore". It is 14 C.C.No.15769/17 J important here to mention that, the accused during her cross examination has categorically admitted that, she is working as a Group 'D' employee in Room No.36, Ground Floor, Vidhana Soudha, Bangalore. Hence, the admissions of the accused and documents produced by the complainant ie Ex.C.3 ot 10 makes it clear that, the legal notice issued by the complainant was sent to the correct address of the accused ie office address of the accused and same has been served on the accused as per Ex.C.6 ie postal acknowledgement. The another notice which was issued to the residential address of the accused was returned as "No such number in Kauverinadi Road, not known , hence returned to sender" as per Ex.C.8. However, on entire perusal of the Ex.C.3 to C.10 and coupled with the admissions of the accused makes it clear that, the legal notice caused by the complainant was sent to the correct address of the accused through RPAD and same has been served upon the accused. In addition to that, the accused has not produced any documents to show that, she is not residing in the address shown by the complainant in the legal notice, postal 15 C.C.No.15769/17 J acknowledgement and RPAD cover as on the date of issuance of the legal notice and its service , therefore the accused has admitted that, the legal notice issued by the complainant was to her correct address and same has been evidenced by Ex.C.6 ie postal acknowledgement. Even it is not the defence of the accused that, the complainant by colluding with the postal authorities got created the endorsement and postal acknowledgement and produced before the court to show that, the legal notice caused by him was served upon the accused, hence in view of the non denial of the postal department documents and admissions of the accused makes it very clear that, the legal notice caused by the complainant was to the correct address of the accused and same has been served on the accused and it can be presumed U/Sec.27 of General Clauses Act as served on the accused. In this regard, it is relevant here to refer the decision of Hon'ble High Court of Karnataka reported in 2011 ACD 1572 (KAR) in the case of Jayamma Vs. Lingamma, wherein the Hon'ble High Court held that, "Notice sent at correct address 16 C.C.No.15769/17 J returned unclaimed - is deemed to be served. In another decision reported in 1998 KAR 1841 in the case of Shridhar M.A. Vs. Metalloy Steel Corporation and 1999 Cri.L.J. 4606 "K. Bhaskaran Vs. Vaidhanbalan wherein the Hon'ble Apex Court was concerned with the question as to when the service of notice could be inferred and it was held that if there is an endorsement like 'not available in the house' 'house locked' 'shop closed' 'unclaimed' the service should be deemed to have been effected. It is also relevant here to refer the decision reported in 2008(4) Civil code cases 027 (SC) "M/s. Indo Automobiles Vs., M/s. Jai Durga Enterprises and others." wherein the Hon'ble Apex Court held that, "notice sent by registered post with acknowledgement to a correct addressservice of notice has to be presumed". Therefore in view of the principles of law in the above decisions, it can be safely held that, the service of notice on accused, the notice issued by the complainant through 17 C.C.No.15769/17 J registered post to the correct address of the accused is held proper. In addition to that, it is relevant here to refer the decision reported in 2007 AIR SCW 3578 in the case of C.C.Alavi Haji Vs. Palapetty Muhammed and another., wherein the Hon'ble Apex court held that " the drawer of the cheque is permitted to deposit the cheque amount within 15 days from the date of his appearance before the court in pursuance of the service of summons on him and in such situation, his defence of non service of the legal notice cannot be available to him'. Hence, in view of the said principles of law, even for sake of discussion, though there is no cogent and reliable documentary proof to substantiate the claim of the complainant with regard to addresses of the Accused to show there is due service of the legal notice on the Accused, in view of settled position of law by virtue of the above said decision of Hon'ble Apex Court of India, the Accused is not entitled to the technical defence of the alleged non service of the legal notice. Hence, the complainant has complied all the mandatory requirements as required U/s.138 18 C.C.No.15769/17 J
(a) to (c) of the N.I.Act and initial presumptions can be drawn infavour of the complainant as required U/s.118(a) and 139 of N.I.Act.
16. It is also the defence of the Accused that, the complainant has not lend loan amount in question to her and in turn she has not issued the cheque in question towards discharge of the said loan amount. In this regard, the learned counsel for the accused has cross examined in length but nothing has been elicited either to discard or disbelieve the evidence of the complainant. The complainant /PW.1 in his cross examination has clearly stated that, he knows the accused since 10 to 15 years and her family members are also acquainted with him and he had a monthly income of Rs.60,000 to Rs.70,000/ from all the sources and he has lent loan amount of Rs. 3 Lakhs to the accused by way of cash and the said amount was paid out of his savings. The complainant/PW.1 has also stated that, accused has stated that, accused has some domestic problems for which she wanted the loan amount from him and assured him to repay the said loan amount 19 C.C.No.15769/17 J within 3 months and he have lend the loan amount to the accused in the month of December 2016 and except the cheque in question he had not collected any documents from the accused and the accused has issued the cheque in question to him on 28.4.2017 when he had visited her house seeking repayment of the loan amount. The complainant/ PW.1 has denied the suggestion made to him that, one Umesh with Executive agency No.1006, who is working in Adishwara Electronics in Banashankari Branch, Bengaluru, is his friend and while purchasing the LED TV from Adishwara Electronics,in Banashankari Branch, Bengaluru, in the month of September 2015 he had got received the subject cheque as a signed blank cheque from the accused and same has been given to the Adishwara Electronics for the purpose of security of the TV loan and after clearance of the TV loan amount he have got issued NOC to the accused and while issuing the NOC to the accused he had made her believe that, security cheque was no longer of any use and he have already torn it off and though he had assured the accused that, he had already torn of the cheque 20 C.C.No.15769/17 J of the accused, he have filed the present false case against her by misusing the said cheque. The complainant/PW.1 has also denied the suggestion that, the cheque in dispute had been issued by the accused in the month of September 2015 and not in the month April 2017 and by not causing the legal notice to the accused to her correct address, intentionally he have avoided the service of legal notice to her and intentionally he have sent the legal notice to her false address and managed to see that, the same is not served on her and he have no funds of Rs.3 Lakhs with him so as to pay the accused and deposing falsely and the accused never availed a loan of Rs.3 Lakhs from him and the cheque in dispute had been issued by the accused to Adishwara Electronics as security cheque while purchasing the TV and it was never issued to him towards any purpose. Hence on entire perusal of the cross examination of the complainant nothing has been elicited either to discard the evidence of PW.1 or to accept the defence of the accused.
17. It is also relevant here to mention that, it is 21 C.C.No.15769/17 J true that, the complainant/PW.1 in his cross examination has admitted that, he is an income tax asseessee and he has to enquried with his auditor as to if he have declared in his I.T.returns about his lending of Rs.3 Lakhs to the accused. Hence, it goes to show that, even for sake of discussion if it is assumed that, the complainant has not declared the loan transaction in question in his I.T. returns , in such circumstances whether only on the ground of non declaration of the loan amount in question that itself invalidates the transaction in question or not is to be taken into consideration. In this regard, it is necessary here to refer the decision of our Hon'ble High court of Karnataka reported in 2019(1) Kar. L.R.185 in the case of Sri.Yogesh Poojary Vs. Sri.K.Shankara Bhat in the said case the Hon'ble High Court of Karnataka held that " Negotiable Instruments Act, 1881 - Sections 138 and 139 Endorsement 'payment stopped by drawer' - The trial court in the instant case, merely considered a suggestion made from the Accused side in the crossexamination of PW1 that the complainant 22 C.C.No.15769/17 J was an income tax assessee and that he has not declared the alleged loan transaction in his returns and disbelieved the case of the complainant that too, ignoring that legal presumption under section 139 of the N.I. Act, was operating in favour of the complainant For these reasons, it has to be held that the complainant has beyond reasonable doubt proved the guilt of the Accused punishable under Section 138 of the N.I. Act. As such, the impugned judgment of acquittal passed by the trial court deserves to be set aside and respondent/ Accused is liable to be convicted for the offence punishable under Section 138 of the N.I. Act. Hence in view of the principles of law laid down by the Hon'ble High court of Karnataka in the above referred decision, in the present case also the complainant has not produced his I.T. returns and has not declared in his I.T. Returns about lending of loan amount in question,, but as it is already held that, the complainant has discharged his primary 23 C.C.No.15769/17 J burden by complying the mandatory provisions of Sec.138 of N.I. Act, therefore it is for the accused to rebut the presumption existing infavour of the complainant U/s.139 of Negotiable Instruments Act. Apart from that, the admissions of the complainant with regard to non declaration in I.T. Returns could not by itself draw an adverse inference and to hold that, there was no existence of legally enforceable debt or the presumption as envisaged U/s.139 of N.I.Act is successfully rebutted by the accused. In another decision of Hon'ble Madhya Pradesh High Court decided in C.R.R No.5263/2018 dated:
7.3.2019 in the case of Smt. Ragini Gupta Vs. Piyush Dutt Sharma Gwalior., wherein the Hon'ble High Court held that, mere non filing of income tax return would not automatically dislodge the source of income of the complainant and non payment of income tax is a matter between the revenue and assessee and if the assessee has not disclosed his income in the income tax return, then the income tax department is well within its right to reopen the assessment of income of the assessee and 24 C.C.No.15769/17 J to take action as per provisions of Income Tax Act, however non filing of income tax return by itself would not mean that, the complainant had no source of income and thus no adverse inference can be drawn in this regard only because of absence of income tax return. Hence in view of the principles of law laid down by Hon'ble High Court of Madya Pradesh in the above said decision in the present case also even though if it is assumed that, the complainant has admitted that, he has not declared in his I.T. Returns about loan transaction in question that itself would not automatically dislodge the source of income of the complainant. Therefore the admissions of the complainant which are elicited in his crossexamination are not helpful for the accused to prove her defence that, in view of non declaration of loan transaction in his I.T. Returns that itself sufficient to hold that, the complainant has no source of income cannot be acceptable one.
18. It is important to note here that, the accused during the cross examination of complainant 25 C.C.No.15769/17 J has disputed the financial capacity of the complainant by suggesting that, since he did not have any funds ie., of Rs.3 Lakhs with him has not produced any documents before the court so as to lend the loan amount to the accused. It is true that, the complainant except the cheque in question has not produced any documents to show that he had possessed a sum of Rs.3 Lakhs to lend the loan amount in question to the accused. But the perusal of entire oral and documentary evidence produced by the complainant i.e Ex.C.1 to C.10 and admitted facts by the Accused, the complainant has proved that the cheque in question belongs to the account of the Accused i.e Ex.C.1 and signature found at Ex.C.1(a) is that of the signature of the Accused and also proved that, the cheque in question was presented within its validity period and it was dishonoured for the reason of "Funds Insufficient"
as per Ex.C.2 and thereafter a legal notice was caused by the complainant as per Ex.C.3 through RPAD to the Accused and it was served on the accused as per Ex.C.6 postal acknowledgement, but the Accused has not given any reply to the legal 26 C.C.No.15769/17 J notice, in such circumstances, it can be held that, the complainant has discharged his initial burden by complying the mandatory requirements as required U/s.138 of N.I. Act and initial presumptions are available in favour of the complainant U/s.118(a) and 139 of the N.I. Act. Consequently it is for the Accused to rebut the presumptions available in favour of the complainant to show that, the cheque in question was not issued either to the complainant or towards discharge of any legally recoverable debt by producing cogent and convincible evidence but not mere suggestions or even by plausible explanation. In such circumstances, when the presumptions U/s.118 and 139 of N.I.Act are available to the complainant, even a presumption can be drawn to the extent of existence of legally recoverable debt or liability against the Accused unless and until the said presumptions are rebutted by the Accused, even in the absence of documents produced by the complainant with regard to loan transaction in question and source of income. In this regard, it is relevant here to refer the decisions reported in 2001 27 C.C.No.15769/17 J AIR Karnataka HCR 2154 between 'M/s.Devi Tyres V/s.Navab Jan' and in 2011 ACD 1521 (KAR) between 'Smt. Usha Suresh V/s. Shashidharn', in 2010 SC 1898 between 'Rangappa Vs. Mohan' and 2011 ACD 1412 (KAR) between 'N.Hasainar Vs. M.Hasainar, S/o. Ibrahim'. The Hon'ble High Court of Karnataka in the above decision i.e., 2001 AIR Karnataka HCR 2154 at para No.6 was pleased to hold that issuance of cheque itself was an adequate proof of existence of debt or liability. In another decision of Hon'ble Apex Court of India i.e. Hon'ble Three Judges Bench Decision reported in (2010) 11 SCC 441 in the case of Rangappa Vs. Sri. Mohan ., wherein the Hon'ble Apex Court held that "
A. Negotiable Instruments Act, 1881 - S.139 - Presumption under- scope of - Held, presumption mandated by S. 139 includes a presumption that there exists a legally enforceable debt or liability-However such presumption is rebuttable in nature - Criminal Trial - Proof - Presumptions
- Generally. Further held that "Signature on the 28 C.C.No.15769/17 J cheque was his, statutory presumption under S.139 comes into play and the same was not rebutted even with regard to the materials submitted by complainant Appellant not able to prove "lost cheque" theory - Apart from not raising a probable defence appellant was also not able to contest the existence of a legally enforceable debt or liability-hence, his conviction by High Court, held, proper. In another decision of Hon'ble Apex Court of India, reported in CRIMINAL APPEAL NO. 508 OF 2018 DT 15032018 between ROHITBHAI JIVANLAL PATEL Vs. STATE OF GUJARAT AND ANR held that "Negotiable Instruments Act facts like source of funds are not relevant if the Accused has not been able to rebut the presumption. It is further held that "
When such a presumption is drawn, the facts relating to the want of documentary evidence in the form of receipts or accounts or want of evidence as regards source of funds were not of relevant consideration while examining if the 29 C.C.No.15769/17 J Accused has been able to rebut the presumption or not". In another decision of Hon'ble Apex court of India decided in Crl.Appeal No.1545 of 2019 dt.17/10/2019 by the Hon'ble Apex Court of India in the case of Uttam Ram Vs. Devinder Singh Hudan and Anr. Wherein the Hon'ble Apex Court held that, " Dishonor of cheque - Statutory presumption under - burden to prove - the burden is on the accused to rebut the presumption that the cheque was issued not for any debt or other liability - it is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer - even a blank cheque leaf, voluntarily signed and handed over by the accused which is towards some payment, would attract presumption U/s. 139 of NI Act - the accused is held guilty of dishonour of cheque for an offence U/s.138 of NI Act. It is also held that, " the accused has failed to lead any evidence to rebut the statutory presumption, a finding 30 C.C.No.15769/17 J returned by both the Trial Court and High Court. Both courts not only erred in law but also committed perversity when the due amount is said to be disputed only on the account of discrepancy in the cartons, packing materials or the rate to determine the total liability as if the appellant was proving his debt before the civil court. Therefore it is presumed that, the cheque in question were drawn for consideration and the holder of the cheques received the same in existing debt". It is also held that, "the Trial court and the High Court proceeded as if, the appellant is to prove a debt before civil Court wherein, the plaintiff is required to prove his claim on the basis of evidence to be laid in support of his claim for the recovery of the amount due. A dishonour of cheque carries statutory presumption of consideration. The holder of cheque in due course is required to prove that, the cheque was issued by the Accused and that when the same presented , it 31 C.C.No.15769/17 J was not honoured Since there is a statutory presumption of consideration, the burden is on the Accused to rebut the presumption that, the cheque was issued not for any debt or other liability". It is also relevant here to refer the decision of Hon'ble High Court of Karnataka reported in ILR 2019 KAR 493 in the case of Sri.Yogesh Poojary Vs. Sri.K.Shankara Bhat, wherein the Hon'ble High Court held that, the presumption mandated by Sec.139 of N.I Act includes the presumption that, there existed a legally enforceable debt or liability, however such presumption is rebuttable in nature". In another decision of Hon'ble High Court of Karnataka in the case of Shri.V.R.Shresti Vs. Shri. Bhaskara.P. in Crl. Appeal No. 2109/2017 dated: 15.10.2019 wherein the Hon'ble High Court of Karnataka held that "the Accused has not given any reply to the notice and also in the crossexamination, he categorically admits that, the cheque has bounced on account of no sufficient fund in the 32 C.C.No.15769/17 J bank account of the Accused. Mere non producing of the document before the court with regard to the source of income to advance a loan is not a ground to dismiss the complaint. The Accused ought to have rebutted the contention of the complainant by producing cogent evidence before the court and mere denial is not enough".
In another decision of Hon'ble Apex Court of India reported in ICL 2021(2) SC 529 in the case of M/s. Kalamani Tex Vs. P.Balasubramanian , dt:
10.02.2021 wherein the Hon'ble Apex court held that " once the accused had admitted his signatures on the cheque and deed, the trial court ought to have presumed that, the cheque was issued as consideration for legally enforceable debt" . In another decision of Hon'ble Apex Court of Indian in Crl. Appeal No.132/2020 in the case of D. K. Chandel Vs. M/s Wockhardt (L) wherein it is held that, "Production of account books / cash book may be relevant in the civil court, may not be so in the criminal case filed 33 C.C.No.15769/17 J under Sec.138 of N.I. Act while restoring the trial court judgments, the High Court observed that "the reason given by the lower Appellate Court that, he did not bring the cash book or order book etc., could well be understood, if civil suit is tried." But may not be so in the criminal case filed under Sec.138 of N.I. Act. This is because of presumption raised in favour of holder of cheque. Therefore on careful reading of the principles of law laid down by the Hon'ble Apex Court of India and High Court of Karnataka in the above referred decisions makes it very clear that, once the holder in due course i.e. the complainant proved that, the cheque in question belongs to the drawer and signature appearing on the cheque is that of the drawer i.e., Accused and complied the mandatory requirements as required U/s.138 of N.I.Act, presumptions U/s.118(a) and 139 of N.I.Act indeed does extend to the existence of legally recoverable debt and when such presumption is drawn, the facts relating to the want of documentary evidence in the form of receipts or accounts or want 34 C.C.No.15769/17 J of evidence regarding source of funds were not of relevant unless the Accused rebutted the presumption available to the complainant as held by the Hon'ble Apex Court and High Court of Karnataka in the above decisions. In the present case also the complainant has complied the mandatory requirements and has proved that, the Accused has issued the cheque in question in his favour and the Accused has admitted the cheque belongs to her account and her signature on the cheque and complainant has proved that the legal notice issued by him was served on the Accused but accused has not given any reply to the said notice, in such circumstances, presumptions have to be drawn even to the extent of existence of legally enforceable debt as per Sec.118a and 139 of N.I.Act. Therefore, for the above said reasons the defence taken by the Accused that, the complainant has not produced the documents to show that, he has lend the loan amount of Rs.3 Lakhs to the accused and in turn the accused has issued the cheque in question towards discharge of the liability in question cannot be acceptable one. The defence taken by the Accused 35 C.C.No.15769/17 J appears that, the complainant has to prove his claim by producing his evidence as if it is required for proving his debt before the Civil Court, but same cannot be permissible in proceeding initiated U/s.138 of N.I. Act, as held by the Hon'ble Apex court of India in the above referred decisions, therefore in view of the principles of law laid down in the above referred decisions. It is presumed that, cheque in question was drawn for consideration as the Accused has admitted the cheque in question belongs to her account and the signature found on the cheque in question is that of her signature, therefore for the above said reasons the defence taken by the accused cannot be acceptable one, as the accused has miserably failed to rebut the presumptions available to the complainant.
Therefore in view of the above said reasons the arguments canvased by the learned counsel for the accused at para No. 5 to 7 of the written argument can not be acceptable one and with due respect to the principles of law laid down in the decisions relied upon by the counsel for the accused ie., the Hon'ble Apex Court of India and High Court of Karnataka are 36 C.C.No.15769/17 J not applicable to the defence of the accused in this case, as the accused has admitted the cheque belongs to her account and her signature on the cheque and also inspite of service of the notice accused has not chosen to give reply to the said notice , but for the first time before the court has come up with the story that, she had not issued the cheque in question to the complainant and the facts and circumstances of this case and facts and circumstances of the decided cases are not one and the same and accused has not produced any evidence or elicited anything from the complainant to rebut the presumption available to the complainant as held by the Hon'ble Apex Court of India and High Court of Karnataka in the decisions relied upon by the learned counsel for the accused.
19. The accused in order to rebut the presumptions available to the complainant herself examined as DW.1. The accused in her evidence has stated that she knows the complainant and who is friend of her son, during September 2013 her son Sri. Manjuanath insisted her to purchase LED TV on 37 C.C.No.15769/17 J loan by paying monthly installment basis and the complainant voluntarily came forward to purchase the said TV in his name on the loan basis from M/s.Adishwara Electronics Shop, Banashankari Bengaluru and insisted her to get the blank cheque from her banker to pledge the same as guarantee towards the sanction of loan to purchase LED TV on monthly installment basis from M/s. Adishwra Electronic Shop. The accused further stated that, in the month of September 2015 on her requst she got a single blank cheque bearing no.564915 from Karnataka State Cooperative Apex bank, Vidhana Soudha Branch, Bangalore in which she had a monthly salary bank account and handed over the blank signed cheque bearing No.564915 to the complainant for the purpose of pledging the same to sanction the loan for purchase of LED TV and she do not know to read or write any other language including the Kannada other than putting her signature in Kannada as she is an illiterate employee and drawing her monthly salary from the bank through withdrawal slip and she never had any cheque transaction through the bank. The 38 C.C.No.15769/17 J accused/DW.1 further deposed that, she was informed by the complainant that, he has pledged her signed blank cheque with M/s. Adishwara Electronic shop as a security to the loan for the purpose of purchasing LED TV on monthly payable installments and he has got the said TV to her on 18.9.2015 and the amount of the said TV is Rs.47,490/,the invoice, warranty card were handed over to her by the complainant on 18.9.2015 and thereafter she had paid the monthly installment amount to the complainant on every month since October 2015 to August 2016 regularly without fail by way of cash and the said loan was completely cleared in the month of August 2016 and on 8.8.2016 the complainant gave to her No objection certificate issued by M/s. Adishwara Electronic Shop, Banashanakri Bangalore but the signed blank cheque which was pledged as security to the electronic shop was not handed over to her by the complainant and thereafter she had enquired about the said blank signed cheque but the complainant informed her that, on completion of the loan blank signed cheque will not have any validity and he 39 C.C.No.15769/17 J himself torned off since it is of no use and she had trusted his words and believed him since the complainant is close friend of her son. The accused/DW.1 further deposed that, the complainant has misused her blank signed cheque which was issued to sanction TV loan for guarantee purpose to the M/s. Adishwara Electronic Shop, Banashankari , Bangalore has filed this false case against her though she has not borrowed any loan amount from the complainant and no notice has been issued to her correct address by the complainant and deliberately sent the notice to her wrong address and she has not received any notice thus she had not given an opportunity to give reply and prayed for dismissal of the complaint. The accused in support of her oral evidence has produced Tax invoice issued by Adishwara India Ltd., and warranty card which are at Ex.D.1 and D.2 and her bank statement which is at Ex.D.3 and a letter given to the Bank manager, Apex Bank, Vidhana Soudha Branch, Bangalore dt:
16.9.2019 as per Ex.D.4.
20. The accused has also examined her son as 40 C.C.No.15769/17 J DW.2 who in his evidence has stated that, complainant is his friend since 6 years and he used to visit his house and complainant used to visit his house, during that, time he asked his mother to purchase a TV but his mother refused on ground of no funds with her but the complainant informed him that, he had close acquaintance with the persons working in the Adishwara Electronics as such he could secure a TV with 0% loan to him through the Bajaj Finance for which he had requested to him a cheque and further informed that, he could pay the said loan by way of monthly EMI of Rs.3,000/, accordingly the complainant took him to Adishwara Electronics and upon enquiry they informed that, he had to make a down payment of Rs.14,500/ and to pay the remaining balance amount by way of EMIs of Rs.3,000/ in 11 installments and the total cost of TV was Rs.47,490/ and thereafter he requested her mother to give a cheque to him for said purpose and on 10.9.2015 her mother had gave a cheque to him.
The DW.2 further deposed that, on 18.9.2015 the complainant came to his house and collected the cheque of his mother and informed that he need not 41 C.C.No.15769/17 J come with him and he will go to the show room and give the said cheque to them for the said purpose and the TV would be purchased in his name and the complainant himself filled up requisite documents so as to purchase the TV and on 18.9.2015 they purchased TV and complainant had informed that, on the 2nd or 3rd of every month commencing from the month of October 2015 a sum of Rs.3,000/ would be deducted from his account and for the same purpose he should pay him the said amount by the 5th of every month , accordingly he cleared the entire loan amount by August 2016 by paying 11 EMIs amounts and after one week from then the complainant came and handed over clearance slip by informing that, his loan towards the TV was cleared and thereafter he sought for return of cheque but the complainant informed that, the said cheque would be torn off and he should not worry about the same by believing his words he did not enquiring to the said matter but during the month of October 2017 he came to know that, his mother was arrested by the police and upon enquiry he was informed by the police that, complainant has filed cheque bounce 42 C.C.No.15769/17 J case against his mother and except her signature of his mother she had not filled up the rest of the contents of the cheque since she does not know to read and write.
21. On careful perusal of the entire defence of the accused it appears that, according to the accused and her son, the son of the accused ie DW.2 decided to purchase a TV but the accused refused on the ground of no funds with them but the complainant being a friend of DW.2 ie the son of the accused informed that, he could secure a TV with 0% loan through the Bajaj finance and requested to give a cheque and further informed that, they could pay the loan by way of monthly installment of Rs.3,000/ each. It is also the defence of the accused that, the son of the accused ie DW.2 approached along with the complainant to Adishwara Electronics, Banashankari, Kattriguppe, Bangalore and there they have enquired for purchase of TV and in turn they have been informed that, the total cost of the TV was Rs.47,490/ and they should make a down payment of Rs.14,500/ and to pay the remaining 43 C.C.No.15769/17 J balance amount by way of EMIS of Rs.3,000/ each in 11 installments, thereafter the DW.2 requested his mother ie accuse to give a cheque for him for purchase of TV, accordingly the accused gave him her cheque and thereafter on 18.9.2015 he had given the cheque to the complainant and in turn the complainant alone has approached the TV show room and purchased the TV in his name and informed that, he had given cheque to the show room and he used to pay the monthly installment of Rs.3,000/ through his account and in turn the accused and her son ie DW.2 should pay him the said amount by 5th of every month and even after cleared the entire loan amount by them but the complainant did not return the cheque which was given to him as guarantee towards the loan for purchasing of TV but has misused blank signed cheque of the accused by filing this false case.
22. The accused and her son in order to prove the defence except their oral evidence nothing has been produced before the court to show that, the complainant has purchased LED TV from M/s.
44C.C.No.15769/17 J Adishwara Electronic Shop, Banashankari, Bangalore in his name by pledging the blank signed cheque bearing No. 564915 issued by the accused as a surety to the loan for the purpose of purchasing LED TV on monthly payable installment loan basis as contended by the accused and her son in their respective evidences. It is true that Ex.D.1 and D.2 produced by the accused discloses that, the complainant has purchased LED TV in his name , except the said documents nothing has been produced by the accused to show that, the cheque in question was issued as blank signed cheque and same was pledged to M/s. Adishwara Electronic Shop as a surety for the purpose of purchase of LED TV in the name of complainant. It is also relevant here to mention that, the accused or her son have not produced any documents to show that, they used to pay monthly installments amount to the complainant towards the loan amount and the said loan was completely cleared in the month of August 2016 and have not produced any no objection certificate issued by M/s Adishwara Electronic Shop as stated by the accused and her son in their respective evidences.
45C.C.No.15769/17 J
23. In addition to the above, the accused in her cross examination has admitted that, she had given the cheque in question to her son on 10.9.2015 and in turn her son had handed over the same to the complainant but there are no documents to show that, the cheque in question has been collected by the complainant and accused also admitted that, her son only had given the cheque to the TV shop and her son has received the cheque from her by stating that, he has to pay Rs.30,000/ balance amount to the TV shop and she has not seen either her son or the complainant handed over the cheque in question to the Adishwara Electronic Shop towards security and also admitted that, she has not produced any documents to show that, the cheque in question was given to the Adishwara Electronics as security towards purchase of the TV. The accused has also admitted that, she has no documents to show that on every month they used to pay installment amount in respect of purchase of TV in the hands of the complainant and after completion of the installment amounts in respect of purchase of TV she did not requested either the complainant or to the TV shop 46 C.C.No.15769/17 J for return of cheque and has not taken any action either against the complainant or against the Adishwara Electronics shops for non return of her cheque in question. It is also admitted by the accused that, when her son has requested for return of her cheque to the complainant but the complainant informed him that, the cheque in question was handed over to the Adishwara Electronics shop.
24. It is also relevant here to mention that, the DW.2 ie the son of the accused I his cross examination has admitted that, he will produce the documents to show about purchase of TV from Adishwara Electronics shop by obtaining loan from Bajaj Finance but further he admitted that, the loan was sanctioned in the name of complainant and also admitted that, there is no mentioning in the documents produced by them that, the cheque in question was issued towards security for purchase of TV from Adishwara Electronics shop and has no documents to show that, at the time of purchasing of the TV they have handed over the disputed cheque 47 C.C.No.15769/17 J to the complainant. The DW.2 has also admitted that, he has not produced the documents to show that, he has paid Rs.3,000/ p.m. to the complainant towards installment payment and has produced the documents to show about clearing of the loan amount in respect of purchase of the TV. The DW.2 also admitted that, after clearing the loan he requested the complainant for return of the cheque in question but in turn the complainant informed that, the said cheque was misplaced and same will be returned when it was traced out and also admitted that, he has not taken action against the complainant for non return of cheque which was handed over to the complainant.
25. Therefore from careful perusal of the admissions of the accused and her son ie DW.2 in their cross examination makes it clear that, the accused and her son have clearly admitted that, they have not produced any documents to show that, the cheque in question was collected by the complainant towards security of the loan amount borrowed for purchase of LED TV from Bajaj Finance and the 48 C.C.No.15769/17 J cheque in question was given as guarantee to the TV shop ie M/S.Adishwara Electronics towards purchase of the TV. It is also admitted by the accused and DW.2 that, they have not produced any documents to show that, they have paid monthly installments of Rs.3,000/ to the complainant and have cleared the alleged loan amount towards purchase of TV . It is also admitted by the accused that, she had not seen either her son or complainant have handed over the cheque in question to M/s. Adishwara Electronic Shop as security towards purchase of LED TV. Therefore the oral evidence of the accused and her son ie., DW.2 not substantiated by producing documentary evidence, the oral evidence of the accused and her son are not sufficient to hold that, the cheque in question was handed over as blank signed cheque to the complainant towards purchase of the LED TV by obtaining the loan from Bajaj Finance and in turn the complainant had pledged the cheque in question to the M/s. Adishwara Electronics Shop as the security towards purchase of the TV by him. Hence, the accused has miserably failed to prove her defence 49 C.C.No.15769/17 J by producing cogent and convincible evidence.
26. It is also relevant here to mention that, if really the accused has given blank signed cheque towards security to the loan for purchase of LED TV on monthly installments basis to the complainant and inturn the complainant had pledged the same to the M/s. Adishwara Electronic shop as surety and thereafter the accused and her son have paid the entire installments of loan amount to the complainant and in turn the complainant after their request did not return blank signed cheque of the accused and misused the same, definitely the accused or her son would have initiated action against the complainant for non return of blank signed cheque but no such efforts have been made either by the accused or her son, therefore the conduct of the accused and her son in non taking of action against the complainant for non return of blank signed cheque may leads to draw an adverse inference against them that, the accused and her son have not initiated legal action against the complainant since the accused has issued the 50 C.C.No.15769/17 J cheque in question only toward discharge of the loan amount in question not for any other reason. In this regard it is relevant here to refer the decision of Hon'ble Apex Court of India reported in AIR 2018 SC 3601 in a case of T.P.Murugan(dead) Thr. Lrs.V. Bhojan Vs. Posa Nandi, rep. Thr. Lrs. PA holder, T.P. Murugan V. Bhojan, wherein the Hon'ble apex Court held that "Negotiable Instruments Act (26 of 1881) Ss.118, 138, 139 - Dishonour of cheque - Presumption as to enforceable debt cheques allegedly issued by accused towards repayment of debt Defence of accused that 10 cheques issued towards repayment of loan back in 1995 - behavior of accused in allegedly issuing 10 blank cheques back in 1995 and never asking their return for 7 years, unnatural - Accused admitting his signature on cheques and pronote, presumption under S.139 would operate against him - Complainant proving existence of legally enforceable debt and issuance of cheques 51 C.C.No.15769/17 J towards discharge of such debt Conviction, Proper". Hence in view of the principles of law laid down by the Hon'ble Apex Court are aptly applicable to the case on hand since in the present case also the accused has not made any efforts to get return of cheque alleged to have been given to the complainant as security towards purchasing of the LED TV, under such circumstances, the said unnatural conduct of the accused and her son in non taking of action, an adverse inference can be drawn against the accused that, the cheque in question issued by the accused towards discharge of the liability and presumption U/s.139 of N.I.Act would operate against her, as she has admitted the signature and cheque in question belongs to the account of accused.
27. The accused in her defence has taken defence that, at the request of her son she had given a blank signed cheque to him towards purchase of LED TV from M/s. Adishwara Electronic Shop, Banashankari, Bangalore and in turn the 52 C.C.No.15769/17 J complainant had collected the said cheque from her son and has pledged the said cheque to M/s. Adishwara Electronic Shop, Banashankari, Bangalore as a security to the loan for purchasing of LED TV on monthly payable installment and thereafter she and her son have paid entire loan amount in the month of August 2016 and requested the complainant to return blank signed cheque which was pledged as security but the complainant did not handed over the same and by misusing her blank signed cheque has filed this false case against her. As it is already held in the above that, the accused has miserably failed to prove that the cheque in question was handed over as blank signed cheque to the complainant towards security to the loan for the purpose of purchasing of LED TV and it was pledged to the M/s. Adishwara Electronics Shop, hence the defence of the accused cannot be acceptable one and in such circumstances it cannot be held that, the cheque in question was handed over to the complainant at the time of purchasing of LED TV from M/s. Adishwra Electronic Shop, Bangalore and pledged towards security of the loan and the 53 C.C.No.15769/17 J accused has repaid the said amount despite of it, the complainant did not return her security cheque and has misused the same. In this regard, it is relevant here to refer the decision of Hon'ble Apex court of India decided in Crl Appeal No.271/2020 in the case of Forex Services Pvt. Ltd., Vs/ Shakthi International Fashion Linkers and Others., wherein the Hon'ble Apex Court held that " the defence of the accused that, cheques were given by way of security is not believable in the absence of further evidence to rebut the presumption. It is also held that, once the issuance of cheque has been admitted and even in the signature on the cheque has been admitted, there is always presumption in favour of the complainant that, there exist legally enforceable debt or liability and thereafter it is for the accused to rebut such presumption by leading evidence". In the present case the accused has failed to prove her defence and also failed to produce evidence to rebut the presumptions, but has 54 C.C.No.15769/17 J admitted the issuance of cheque and also signature thereon is that of her signature, hence by applying the principles of law laid down in the above decisions the defence of the accused cannot be acceptable one. In another decision of Hon'ble High Court of Karnataka reported in 2015 (1) KCCR 235 in the case of Lale Patel Vs. Sharanabasappa., wherein the Hon'ble High Court held that : NEGOTIABLE INSTRUMENTS ACT, 1881 section 138 - Dishonour of cheque for insufficiency of funds Plea of accused that he had given a blank cheque signed as security for a transaction and complainant filled up the contents and denied existence of any debt or loan - Conviction by Trial court Affirmed by Appellate Court - Revision against. Hence the Hon'ble High Court of Karnataka in the above decision clearly held that, even if the Accused has taken defence that, a blank signed cheque has been issued as a security for transaction and the complainant filled up the contents and the accused denied the existence of debt or loan in such circumstances also it is for the 55 C.C.No.15769/17 J accused to prove his defence by producing cogent and convincible evidence, if the Accused has not proved the same, it cannot be held that, the cheques in question was given as security at the time of receiving the loan amount. In the present case also the Accused has failed to establish her defence to show that, the cheque in question was handed over at the time of purchasing of LED TV from M/s. Adishwara Electronics Shop, under such circumstances the cheque so issued cannot be considered as the one issued as a security and the defence taken by the Accused is untenable one. In another decision reported in 2015 (4) KCCR 2881 (SC) in the case of T. Vasanthakumar Vs. Vijayakumari wherein the Hon'ble Apex court held that " NEGOTIABLE INSTRUMENTS ACT, 1881 Section 138 and 139 - acquittal - If justified Accused not disputing issuance of cheque and his signature on it Plea that it was issued long back as security and that loan amount was repaid Not supported by any evidence - Fact that date was printed, would not lend any 56 C.C.No.15769/17 J evidence to case of accused Acquittal not proper. Hence in the present case also it is the main defence of the Accused that the cheque in question was given to the complainant as security, at the time of purchasing of LED TV from M/s. Adishwara Electronic Shop, Banashankari, Bangalore, and the complainant by misusing the said cheque has filed this complaint but the Accused has admitted the issuance of cheque and her signature on the said cheque but no documents or proof produced by the Accused to prove her defence in such circumstances by applying the principles of law laid down in the above decision the defence of the Accused cannot be acceptable one.
28. The accused in her defence evidence has stated that, as pr the request of her son she had given a blank signed cheque for purchase of LED TV from M/s. Adishwara Electronic Shop, Banashankari, Bangalore as a security to the loan and in turn her son had handed over the said cheque to the complainant and the complainant has pledged 57 C.C.No.15769/17 J her signed blank cheque to M/s. Adishwara Electronic Shop, Banashankari, Bangalore as a security to the loan for purchasing of LED TV and thereafter she has paid entire loan amount but the complainant did not return her blank signed cheque inspite of her request and has misused her blank signed cheque by filling the contents of the cheque and except her signature, the rest of the contents of the cheque are not of in her handwriting as she do not know to read or write any other language including Kannada except by putting her signature in Kannada. Hence, according to the accused except her signature she has denied the rest of the contents of the cheque in question as they are not of her handwriting and the complainant has misused her cheque in question by filling the same for Rs.3 Lakhs and filed this case, as it is already held in the above that, the accused has miserably failed to prove that, she had issued blank signed cheque to the complainant and in turn the complainant has pledged her blank signed cheque to M/s. Adishwara Electronic Shop, Banashankari, Bangalore as a security to the loan for purpose of purchasing of LED 58 C.C.No.15769/17 J TV. Hence, it goes to show that, the accused has denied the contents of the cheque in question but she has admitted that, the cheque in question belongs to her account and signature found on the cheque is that of her signature, in such circumstances it can be held that, once signature on the negotiable instrument act is admitted, in that circumstances sec. 20 of N.I. Act comes into play i.e. as per Sec. 20 of N.I.Act if the blank or incomplete Negotiable Instrument is given to the holder in due course, it is to be presumed that, he had given authority to the holder in due course to fill up the remaining portion. In this regard, it is relevant here to refer the decision of Hon'ble High Court of Karnataka reported in ILR 2006 KAR 2054 in the case of H.S.Srinivasa Vs. Girijamma and another wherein the Hon'ble High Court held that " a reading of sec.20 of the act which is extracted above reveals that, the words used are ' either wholly blank or having written therein an incomplete negotiable instrument' . The instrument may be wholly blank or incomplete in 59 C.C.No.15769/17 J a particular in either case, the holder has authority to make or complete the instrument as a negotiable one. The authority implied by a signature to a blank instrument is so vide that, the party so signing is bound to be a holder in due course. Promissory notes are often executed in the name of the payer and left unfilled to be afterwards filled by the actual holder, the object being to enable the owner to pass it off to another without incurring the responsibility as an endorser. Thus, it is seen that, person in possession of an incomplete instrument in maternal particulars has the authority prima facie to fill it and thus the executants becomes liable to pay the amount due'. In another decision of Hon'ble High Court of Madras reported in 2005 (1) DCR 85 in the case of P.A.Thamatharan Vs. Dalmia cements (B) Ltd., wherein it is held that "
Negotiable Instrument Act 1991 - Sec. 138 - dishonour of cheque - plea -body of cheque was not written by Accused - held it is not 60 C.C.No.15769/17 J mandatory and no law prescribes that, the body of cheque should also be written by the signatory to the cheque, a cheque could be filled up anybody and if it is signed by the account holder of the cheque'. In another decision reported in 1996 Cri. L.J.3099( Guj) :1997 II Crimes : 1997 (I) CCR 603 wherein the Hon'ble High Court held that "no law provides that, in any case of any negotiable instrument entire body has to be written by maker or drawer only". It is further held that, " when a cheque is admittedly issued blank are incomplete and there is no dispute regarding the signature, it can be presumed that, there is an implied consent for filling up the cheque as when required by holder and get it encashed. Complaint of dishonour of such cheque cannot be held to be beyond the scope of penal provisions of Sec.138". In another decision of Hon'ble Apex court to India reported in (2002) 7 SCC in the case of P.K. Manmadhan Karthra Vs.Sanjeeva Raj., wherein it is held that " As long 61 C.C.No.15769/17 J as signature on the cheque is admitted, whether the ink with which the other particulars are filled up is different or that the hand writing is not that of drawer does not matter. Until rebutted, the presumption that, cheque was issued for consideration exists". In another decision of Hon'ble High Court of Karnataka at Bengaluru in a case of Crl. Appeal No. 1664/2003 C/w. Crl.Appeal No.1663/2003 dated: 18.6.2008 in the case of R.Mallikarjuna Vs. H.R.Sadashivaiah wherein the Hon'ble High Court at para No.19 held that " But, the question is, whether that renders instrument unenforceable.
In this regard, it must be observed that, this court similar circumstances in the case of S.R. Muralidar Vs. Ashok G.Y. reported in 3001 (4) KAR. LJ K. 122 referring to the provisions of Sections 20, 138, 139, and 140 of the Act and after interpreting alteration and filling up of the cheque observed thus " The trial court has made much about the difference in ink. Admittedly, 62 C.C.No.15769/17 J Accused cheque is issued bearing signature of the Accused. It is the contention of the defence that, blank cheques issued for the business transactions have been illegally converted as a subject matter to this case fastening false liability........ It is not objectionable or illegal in law to receive a inchoate negotiable instrument duly signed by the maker despite the material particulars are kept blank if done with an understanding and giving full authority to the payee to fill up the material contents as agreed upon. Such a course of action in law cannot vitiate the transaction nor can invalidate the negotiable instrument issued and such transaction fully begins the maker of the negotiable instrument to the extent it purports to declare........ The fact that, a document executed is inchoate with regard to some of the material particulars would not render such contract invalid nor make the instrument illegal or inadmissible. Voluntarily, if a person were to 63 C.C.No.15769/17 J deliver an inchoate instrument authorizing the receiver to fill up the material contents as agreed upon, the cheque does not get tainted as in admissible nor it amounts to tampering with the material particulars...... In the present case there is no categorical defence version, it is only by conjunctures and surmises, a case is made out from the difference in ink between the signature of the cheque and the other handwritten contents. Therefore in view of the principles of law of Hon'ble Apex court of India and also Hon'ble High Court of Karnataka and Madras referred above, in the present case the Accused has admitted the signature on Negotiable Instrument i.e. cheque and she also admitted issuance of the cheque, it is primafacie proof of authorizing the holder in due course i.e. the complainant to fill up the remaining contents of the Negotiable Instrument, therefore it cannot lie in the mouth of the Accused that, the complainant had misused or fabricated the cheque in question issued by her and the defence of the Accused cannot be acceptable one as the 64 C.C.No.15769/17 J instruments i.e., cheque in question cannot be rendered unenforceable merely because the contents have been filled by different ink, as it would not rendered such instrument illegal or inadmissible, the complainant certainly can base action on it.
29. It is also important to note here that, the Accused has not denied or disputed that the cheque in question as well as the signature therein do belong to her and she has failed to explain as to how cheque in question has come to the possession of the Complainant, this would also give rise to an adverse inference against her. This preposition of law finds support from the decisions of Hon'ble High Court of Karnataka reported in 2010(1) KCCR 176 in the case of "Siddappa Vs. Manjappa". In another decision of Hon'ble Apex court of India decided in Crl.A.No.664 of 2012 dated: 19.9.2019 in the case of "M.Abbas Haji Vs. T.M.Chennakeshava" held that, "the Accused has to explain how the cheque entered into the hands of complainant". Hence in the present case 65 C.C.No.15769/17 J also the Accused has failed to explain how the cheque in question was entered into the hands of complainant. Therefore for the above said reasons the defense taken by the accused cannot be acceptable one and accused has miserably failed to rebut the presumption available in favour of the complainant by adducing cogent and convincible evidence.
30. Therefore considering all these aspects of the case and totality of the circumstances and on careful and meticulous appreciation of evidence adduced on behalf of the complainant and accused the complainant has successfully established beyond all reasonable doubt that, complainant has proved that, he has lent an amount of Rs.3 Lakhs to the accused as hand loan and in turn the accused has issued Ex.C.1 cheque in question towards discharge of the said loan amount and thereafter the complainant has presented the said cheque through his banker and same was returned dishonoured with an endorsement of "Funds Insufficient" and thereafter he got issued legal notice to the accused 66 C.C.No.15769/17 J and inspite of service of the said notice, the Accused did not repaid amount covered under the dishonored cheque, hence the complainant filed the present complaint against the accused. On the other hand, the accused has failed to rebut the presumption available infavour of the complainant with regard to the existence of legally recoverable debt under Ex.C.1 cheque. Therefore accused has committed an offence punishable U/s.138 of N.I. Act, accordingly for the above said reasons this point is answered in the Affirmative.
31. Point No.2: Negotiable Instrument Act was enacted to bring credibility to the cheque and the very purpose of enactment is to promote the use of negotiable instrument, while to discourage the issuance of cheque without having sufficient funds in their accounts. Such being the case the intention of the legislature is that, complainant be suitable compensated while accused be punished for her act. Hence while awarding the compensation the said fact is to be kept in mind and suitable compensation is awarded to the complainant certainly it will not cause 67 C.C.No.15769/17 J injustice to the accused, accordingly the complainant is entitled for the compensation as ordered by the court and for the said reasons, it is just and proper to pass the following : ORDER Acting U/sec.255(2) of Cr.P.C.
the accused is convicted for the offence punishable U/sec.138 of N.I.Act.
The accused is sentenced to pay a fine of Rs.3,15,000/= (Rupees Three Lakhs and Fifteen Thousand only) in default she shall under go simple imprisonment for a period of (3) three months for the offence punishable U/sec.138 of N.I.Act.
Further acting U/sec.357(1) of Cr.P.C. out of the fine amount on recovery, a sum of Rs.3,10,000/= (Rupees Three Lakhs and Ten Thousand only) shall be paid as compensation to the complainant.
Further acting U/sec.357(1)(a) of Cr.P.C. out of fine amount on recovery a sum of Rs.5,000/= (Rupees Five Thousand only) 68 C.C.No.15769/17 J shall be defrayed as prosecution expenses to the state.
The Bail bond of the Accused stands cancelled after appeal period is over.
Office is directed to furnish free certified copy of this judgment to the Accused incompliance of Sec.363(1) of Cr.P.C.
(Directly dictated to the stenographer online, printout taken by her, verified, corrected and then pronounced by me in the open Court on this the 4th day of January 2022).
. (SRI.S.B. HANDRAL),
XVI ACMM, Bengaluru City.
ANNEXURE
1. List of witness/s examined on behalf of the Complainant: P.W.1 : Sri.H.G.Prakash
2. List of documents exhibited on behalf of the Complainant: Ex.C.1 : Original Cheque;
Ex.C.1(a) : Signature of the Accused;
Ex.C.2 : Bank Memo
Ex.C.3 : Office copy of the Legal Notice;
Ex.C.4 & 5 : postal receipts;
69
C.C.No.15769/17 J
Ex.C.6 : Postal acknowledgement
Ex.C.7 Returned legal notice
Ex.C.8 : Postal envelope
Ex.C.9 : Postal Receipt;
Ex.C.10 ; Postal acknowledgement
3. List of witness/s examined on behalf of the Accused: DW.1 : Smt.Jayamma DW.2 : Sri.Manjunath
4. List of documents exhibited on behalf of the Accused: Ex.D.1 : Tax Invoice, Ex.D.2 : T.V. warranty card issued by Adishwara India Ltd.
Ex.D.3 : statement of accounts for the period
from 1.9.2015 to 12.09.2015
Ex.D.4 ; Letter submitted to the Manager Apex
Bank, Vidhana Soudha Branch,
Bangalore dt; 16.9.2019
(SRI.S.B.HANDRAL),
XVI ACMM, Bengaluru City.
70
C.C.No.15769/17 J