Bangalore District Court
M. Shankara Reddy vs Ramakrishnappa on 15 April, 2024
KABC030034472023
Presented on : 21-01-2023
Registered on : 21-01-2023
Decided on : 15-04-2024
Duration : 1 year, 2 months, 25 days
IN THE COURT OF THE XXI ACMM, BENGALURU
Dated: This the 15th day of April, 2024
Present:
SRI.GIRISH CHATNI, B.A.,LL.B.,(Spl)
XXI ACMM, Bengaluru
C.C.No.2136/2023
Complainant : Sri.Shankara Reddy,
S/o Late.Aswathnarayana Reddy,
Aged about 55 years,
Residing at Motakapalli Village,
Gulur Post, Bagepalli Taluk,
Chikkaballapura District - 561207.
(By Sri.C.N., Adv)
V/s
Accused : Sri.Ramakrishnappa,
S/o Krishnappa,
Aged about 50 years,
R/at. Yarlakki Halli Village,
Near Beechganahalli Cross,
Somenahalli Hobli,
2 CC.No.2136/2023
Gudibnade Taluk,
Chikkaballapura District - 561209.
(By Sri.S.M.K, Adv.)
JUDGMENT
This case emanates from a private complaint filed by the complainant alleging that the accused has committed an offence punishable under section 138 of Negotiable Instruments Act, 1881.
2. THE ESSENTIAL FACTS IN BRIEF.
It is the case of the complainant that, he is running poultry business under the name and style Kala Poultry Farm at Motakapalli Village, Gulur Post, Bagepalli Taluk, Chikkaballapura District and he is also supplying wholesale rate of broiler chickens to the retailers in and around Chikkaballapura District of Karnataka and Ananthapur District of Andhra Pradesh. It is further contended that, the accused is a regular customer of complainant and he had been purchasing chicks (broilers) from the complainant on credit basis. It is further contended that, the complainant has supplied the broilers/chicks often and often as per the request of the accused and he had also paying part payments towards purchase of broiler chicks and as per the statement of account/ledger details, the accused has due a sum 3 CC.No.2136/2023 of Rs.2,96,251/- as on 21.09.2022. It is further contended that, when the complainant demanded to pay a sum of Rs.2,96,251/-, which was due to him, the accused has issued a cheque bearing No.630070 dated 08.11.2022 for a sum of Rs.2,96,251/- drawn on Canara Bank, Beechaganahalli Branch, Chikkaballpura District.
2(i). It is further contended that, as per the instructions of the accused, the complainant presented the said cheque for encashment through his Bank i.e., Dhanalakshmi Bank, Gandhinagar Branch, Bengaluru on 09.11.2022. The said cheque was dishonoured and returned as "Funds Insufficient" as per the bank memo dated 10.11.2022. It is further contended that, the complainant got issued a Legal notice dated 09.12.2022 calling upon the accused to pay the cheque amount and the same was served to the accused on 31.12.2022. Despite of service of notice, accused has not paid the amount covered under the cheque nor replied the said notice. Therefore, the complainant filed the present complaint against the accused alleging the commission of offence punishable under section 138 of Negotiable Instrument Act.
3. The complainant has led his pre summoning evidence. He has filed his affidavit by way of sworn statement in 4 CC.No.2136/2023 lieu of oral evidence, in which, he has reiterated the complaint averments. In support of his oral evidence, PW.1 has produced 05 documents, which are marked as Ex.P.1 to Ex.P.5 and closed his side.
4. Prima-facie case has been made out against the accused and has been summoned vide order of the same date. Accused has appeared before the court and has been enlarged on bail. The substance of accusation was read over to him, to which he pleaded not guilty and claimed to be tried.
5. In view of the directions of the Hon'ble Apex Court in a decision reported in (2014) 5 SCC 510 (Indian Bank Association & Others V/s Union of India), the affidavit filed in lieu of sworn statement was treated as evidence of complainant. Thereafter, the accused was examined as provided under section 313 of Cr.P.C., by explaining the incriminating evidence available against him. The defence of the accused is of total denial one. He did not choose to lead either of oral or documentary evidence.
6. Heard both sides. Perused the materials available on record.
7. The following points would arise for consideration. 5 CC.No.2136/2023
1. Whether the complainant proves that the accused has issued cheque bearing No.630070 dated: 08.11.2022, in favour of complainant, for an amount of Rs.2,96,251/- towards discharge of legally enforceable debt and same was returned unpaid on account of "Funds Insufficient"
and thereby committed an offence
punishable under section 138 of
Negotiable Instrument Act?
2. What Order?
8. My findings on the above points are as under:-
Point No.1: In the "Affirmative" Point No.2: As per the final orders for the following:
REASONS
9. Point No.1:
Section 138 of the Negotiable Instrument Act has been enacted to lend credibility to the financial transactions.
The main ingredients of the offence punishable U/s 138 of Negotiable Instrument Act are ;
(I) Drawing up of a cheque by the accused towards payment of an amount of money, for discharge, in whole or in part, of any debt or any other liability.
(ii) Return of the cheque by the Bank as unpaid.6 CC.No.2136/2023
(iii) The drawer of the cheque fails to make the payment of the said amount within 15 days of the receipt of notice under the proviso (b) to Section
138.
The explanation appended to the section provides that the debt or other liability, for the purpose of this section means a legally enforceable debt or other liability.
10. Apart from this, section 139 of Negotiable Instruments Act lays down a presumption in favour of the holder of cheque in the following terms;
"It shall be presumed unless the contrary is proved, that - the holder of the cheque received the cheque, of the nature referred to him section 138, for the discharge in whole or in part, of any debt or other liability."
11. Also, Section 118 of the N.I.Act states - Until the contrary is proved, the following presumptions shall be made:--
(a) of consideration:--that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration;
(b) as to date:--that every negotiable instrument bearing a date was made or drawn on such date;
(c) as to time of acceptance:--that every accepted bill of exchange was accepted within a reasonable time after its date and before its 7 CC.No.2136/2023 maturity;
(d) as to time of transfer:--that every transfer of a negotiable instrument was made before its naturity;
(e) as to order of endorsements:--that the indorsements appearing upon a negotiable instrument were made in the order in which they appear then on;
(f) as to stamp:--that a lost promissory note, bill of exchange or cheque was duly stamped;
(g) that holder is a holder in due course:--
that the holder of a negotiable instrument is a holder in due course: provided that, where the instrument has been obtained from its lawful owner, or from any person in lawful custody thereof, by means of an offence or fraud, or has been obtained from the maker or acceptor thereof by means of an offence or fraud, or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him."
12. Thus the Act clearly lays down presumption in favour of the complainant with regard to the issuance of the cheque by the accused towards the discharge of her liability in favour of the complainant.
13. Under the scheme of the Act, the onus is upon the accused to rebut the presumptions in favour of the complainant by raising a probable defence.
14. It is a well settled position of law that, the defence of the accused, if is in the nature of a mere denial of the case of the 8 CC.No.2136/2023 complainant will not be sufficient to hold it as a probable defence. The bare denial of the passing of consideration apparently does not appear to be any defence. Something which is probable must be brought on record for getting the benefit of shifting the onus of proof to the complainant.
15. It is also a well settled position of law that once the cheque is proved relating to the account of the accused and if he /she accepts and admits the signature on the said cheuqe, then the initial presumption as contemplated under section 139 of the N.I.Act has to be raised by the court in favour of the complainant.
16. The presumption referred to in section 139 of N.I.Act is a mandatory presumption and not a general presumption, but the accused is entitled to rebut the said presumption. What is required to be established by the accused in order to rebut the presumption is different from each case under given circumstances. However, the fact remains that a mere plausible explanation is not expected from the accused and it must be more than a plausible explanation by way of rebuttal evidence. The defence raised by the accused by way of rebuttal evidence, must be probable and capable of being accepted by the court. 9 CC.No.2136/2023
17. No doubt the initial mandatory statutory presumption as provided under sections 118 and 139 of N.I.Act are in favour of the complainant. However, they are rebuttable presumptions and the accused expected to rebut the presumption by raising a probable defence.
18. Such being the legal position, it would be pertinent to refer the defence raised by the accused to rebut the presumptions in favour of the complainant in this case. On perusal of the examination of accused as contemplated U/s. 313 of Cr.P.C and cross-examination of P.W.1, the accused has raised the following defence;
i. The accused has denied the issuance of cheque in favour of the complainant, however, contends that the cheque has been issued in favour of company. ii. The cheque in question has been issued in the year 2008.
iii. The complainant has took the cheque in question in advance, when he has supplied the Chicken to the accused on credit basis.
19. Now let me consider the evidence on record, the complainant has got examined himself as PW.1 by filing sworn 10 CC.No.2136/2023 statement by way of affidavit in lieu of oral evidence, wherein, he has reiterated the entire averments made in the complaint.
20. In support of his oral evidence, PW.1 has produced cheque as per Ex.P.1, the signature on the said cheque was identified by PW.1 as that of accused as per Ex.P.1(a), the Bank Memo as per Ex.P.2, the office copy of the Legal notice as per Ex.P.3, Postal Receipt as per Ex.P.4 and Postal Acknowledgment Card as per Ex.P.5. On perusal of the Ex.P.1 to Ex.P.5, it appears that the complainant had complied with the mandatory requirements of section 138 of Negotiable Instruments Act. Therefore, a presumption can be drawn in his favour as contemplated U/s 118 and 139 of N.I.Act
21. On perusal of the materials on record, the accused has not chosen to lead evidence. The accused in order to prove his defence has cross examined PW.1, wherein, nothing has been elicited from the mouth of the PW.1 in order to prove his defence. On going through the cross examination part of PW.1, the accused has made an effort by only suggesting as to he has not produced the Bills pertaining to the amount mentioned in the cheque in question. However, PW.1 has clarified the same by deposing that he has produced Ledger Book Extract. 11 CC.No.2136/2023
22. On going through the documents produced by the complainant, in all he has produced 05 documents, which are marked as Ex.P.1 to Ex.P.5. Though, PW.1 during his cross examination has admitted that he has produced the Ledger Book of the accused, however, no documents are produced by the complainant. On perusal of the materials on record, the complainant has produced the Ledger book of the accused, wherein, the accused is still in due to pay the amount mentioned in the cheque in question with regard to the purchase of the Chicken. No doubt, the said document has not been marked, but in order to adjudicate the matter, it does not preclude this court to look into the entries in the said extracts.
23. The defence of the accused i.e., evident in his plea and examination U/s 313 of Cr.P.C., is of entire denial one. On perusal of the materials on record, the accused has not disputed regarding the cheque belonging to him and signature there on. Though the accused has contended that, the cheque has been issued in favour of the company and the cheque is of the year 2008, but the accused has failed to show before this court that how the name of the complainant has been entered in the cheque in question. Moreover, the accused has not taken any interest in examining the officials of the Bank Authorities or has 12 CC.No.2136/2023 taken the relevant documents/reports from the Bank Authorities stating that the cheque in question has been issued to him in the year 2008. Moreover, the accused has not given any police complaint with regard to the misuse of the cheque by the complainant nor has issued any 'Stop Payment' instructions with the Bank Authorities in order to stop the payment in case the cheque in question is presented for collection.
24. On perusal of the examination of the accused as provided U/s 313 of Cr.P.C., the accused has denied the issuance of notice and service thereon. Ex.P.5 is the Postal Acknowledgment, it further reveals that the accused has received the demand notice from the complainant. Therefore, the said line of contention that the notice has not been served upon the accused is not tenable.
25. The statutory notice U/s 138 of N.I.Act leads to an inference that there was merit in the complainants version, apart from raising a probable defence by the accused issuing the reply to the complainant was the first opportunity to the accused to set up her defence. Not replying to the notice, which is duly served is fatal to the defence of the accused. Any version taken during the course of the trial amounts to an after thought and the same 13 CC.No.2136/2023 requires to be considered with a pinch of salt. It is also found from the records that the accused had no impediment to give reply to the notice sent under the provisions of N.I.Act. A ordinary prudent man would immediately issue a reply to the notice alleging his grievances, if the demand notice contains false statement. The said position is settled and fortified in a decision of the Hon'ble Apex Court and the Hon'ble High Court of Karnataka in cases of Rangappa V/s Mohan reported in AIR 2010 Supreme Court 1898, Muralidhar Rao V/s P.Nagesh reported in 2021(2) KLJ 647 and in case of Jayalakshmma V/s Shashikala reported in 2021(2) KCCR 1511.
26. No doubt, it is a well settled principle of law that an accused need not enter into witness box to defend his case, but it is sufficient, if he would be able to establish his defence by relying upon the materials placed on record by the complainant I.e, oral and documentary evidence.
27. Moreover, the accused has not denied or disputed the cheque in question as well as the signature thereon do belong to him and has failed to explain as to how the said cheque came in possession of the complainant. This would also give rise to an adverse inference against him.
14 CC.No.2136/2023
28. On over all perusal of the materials on record, this court has no hesitation to hold that the complainant is entitled to the benefit of the presumptions available U/s 118 and 139 of the Negotiable Instruments Act. In this context of matter, it is useful to refer the decision of the Hon'ble Apex Court in APS FOREX SERVICES PRIVATE LTD., V/S SHAKTHI INTERNATIONAL FASHION LINKERS AND OTHERS reported in AIR 2020 Supreme Court 945, wherein, it has been observed and held that once the issuance and the signatures of the cheque/s is admitted, there is always presumption in favour of complainant that there exists legally enforceable debt or liability.
29. It is also profitable to refer another decision of the Hon'ble Apex Court in P.RASIYA V/S ABDUL NAZEER AND ANOTHER reported in 2022 SCC Online Supreme Court 1131, wherein, it has been observed and held that once the initial burden is discharge by the complainant, that the cheque were issued by the accused and signatures of the accused on the cheque is not disputed, then in that case, the onus will shift upon the accused to prove the contrary that the cheque was not for discharge or any debt or other liability.
15 CC.No.2136/2023
30. In view of the principles enunciated in the decisions referred supra, it is evident that when once issuance of cheque/s with signatures of the accused on the account maintained by him/her is admitted or proved, then statutory presumption in terms of sections 118 and 139 of N.I.Act will have to be drawn. On perusal of the materials on record, the accused has failed to rebut the presumptions which are in favor of the complainant by raising probable defence. In view of the discussions made above, I answer point No.1 in the "Affirmative".
31. Point NO.2:- In the light of discussions made at point No.1, I proceed to pass the following;
ORDER
By invoking the power conferred
under section 255(2) of Cr.P.C., the
accused is hereby convicted of the
offence punishable U/S.138 of N.I. Act.
The accused is liable to pay a fine of Rs.3,06,251/- ( Three Lakhs Six Thousand Two Hundred and Fifty One Rupees Only).
If the fine amount is so realized, Rs.2,96,251/- ( Two Lakhs Ninety Six Thousand Two Hundred and Fifty One Rupees Only) shall be paid to the complainant as compensation and balance 16 CC.No.2136/2023 of Rs.10,000/- is ordered to be adjusted towards cost to the State Exchequer.
In default of payment of such compensation amount, the accused shall under go simple imprisonment for 01 (One) year.
Bail bond of the accused shall stands canceled.
Supply a free copy of this judgment to the accused.
(Dictated to the Stenographer directly on computer, typed by her, corrected by me, signed then pronounced in the open court on this the 15 th day of April, 2024.) GIRISH Digitally signed by GIRISH SHIVANAND SHIVANAND CHATNI Date: 2024.04.15 CHATNI 17:54:48 +0530 (GIRISH CHATNI) XXI ACMM, BENGALURU ANNEXURE
1. List of witnesses examined on behalf of the complainant:
PW-1 : M.Shankara Reddy
2. List of witnesses examined on behalf of the accused:
- NIL -
3. List of documents marked on behalf the complainant:
Ex.P.1 : Cheque
Ex.P.1(a) : Signature of accused
Ex.P.2 : Return Memo
Ex.P.3 : Legal Notice
17 CC.No.2136/2023
Ex.P.4 : Postal Receipt
Ex.P.5 : Postal Acknowledgment Card
4. List of documents marked on behalf of the accused:
- NIL -Digitally signed by
GIRISH GIRISH
SHIVANAND
SHIVANAND CHATNI
CHATNI Date: 2024.04.15
17:54:39 +0530
(GIRISH CHATNI)
XXI ACMM, BENGALURU