Bangalore District Court
Sri. C.Govindaraju Reddy vs Sri. K.Neelakrishna Raju @ on 18 December, 2018
1 C.C.No.15048/2015 J
THE COURT OF THE XVI ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE, BENGALURU CITY
Dated: This the 18th day of December, 2018
Present: Smt. Saraswathi.K.N, B.A.L., LL.M.,
XVI Addl.C.M.M., Bengaluru City.
JUDGMENT U/S 355 OF Cr.P.C.,
Case No. : C.C.No.15048/2015
Complainant : Sri. C.Govindaraju Reddy,
S/o. Chenga Reddy,
Aged about 48 years,
Residing at No.674,
31st Cross, 22nd Main,
Tilak Nagar,
Bengaluru - 560 041.
(Rep. by Sri.T.R.Manjappa, Adv.,)
- Vs -
Accused : Sri. K.Neelakrishna Raju @
Babu,
S/o. Desi Raju,
Aged about 41 years,
R/at Skanda Mansion,
No.14, 5th Main Road,
Navodaya Nagar,
J.P.Nagar 7th Phase,
Bengaluru - 560 076.
(Rep. by Sri. Siddaramu.N, Adv.,)
Case instituted : 19.1.2015
Offence complained : Under Sec. 138 of the N.I Act
of
Plea of Accused : Pleaded not guilty
2 C.C.No.15048/2015 J
Final Order : Accused is convicted
Date of order : 18.12.2018
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 and he are known to each other since several years. In this connection, the Accused approached and requested him during the first week of May 2014 for a financial assistance of Rs. 2,80,000/= for his contract work and family necessities. Thereafter considering the request of the Accused, he arranged the funds and paid the said amount of Rs.2,80,000/= to the Accused by way of cash on 9.5.2014 and the Accused has received and acknowledged the said sum of Rs.2,80,000/= in the presence of the witnesses. For the repayment of the said amount, the Accused has issued the two post dated cheques bearing No. 251452 dated 23.9.2014 for Rs. 1,80,000/= drawn on the Central Bank of India, Sarakki Layout Branch, Bengaluru and another cheque bearing No. 237841 dated 26.11.2014 for Rs.1,00,000/= drawn on the Corporation Bank, N.T.Road Branch, Bengaluru and further assured him 3 C.C.No.15048/2015 J that the said cheques would be duly honored on their presentation on their due dates.
3. The Complainant has submitted that, as per the assurance of the Accused, when he presented the first cheque bearing No. 251452 dated 23.9.2014 for Rs. 1,80,000/= drawn on the Central Bank of India through his banker, to his surprise and shock, the said cheque came to be returned dishonored as "Funds Insufficient". Immediately thereafter, when he appraised the said fact to the Accused, he requested him to re-present the same through his banker. Accordingly when he re-presented the same, again the same came to be returned dishonored as "Exceeds Arrangement" vide Bank Endorsement dated 4.10.2014.
4. Thereafter when he informed this fact to the Accused, again as per his instructions, it was re- presented the same, it returned dishonored as "Exceeds Arrangement" vide Bank Endorsement dated 25.11.2014.
5. The Complainant has submitted that, as per the assurance and the instructions of the Accused, when he presented the second cheque for Rs.1,00,000/= for encashment through his banker, the same came to be returned dishonored as "Account Blocked" vide Bank 4 C.C.No.15048/2015 J Endorsement dated 9.12.2014. Thereafter when he approached the Accused and informed about the same, he gave an evasive reply to him.
6. The Complainant has submitted that, left with no other option, he got issued the legal notice to the Accused on 23.12.2014 calling upon him to pay the cheque amount to him within 15 days from the date of the receipt of the said legal notice. Despite the service of the same, the Accused has neither replied nor has he paid the cheque amount to him. Hence the present complaint.
7. The Complainant submits that, the dishonour of the cheques by the Accused has been malafide, intentional and deliberate. Feeling aggrieved by the conduct of the Accused, he has filed the present complaint praying that, he be summoned, tried and punished in accordance with Sec.138 of the Negotiable Instruments Act.
8. The Complainant has led is pre-summoning evidence and he has filed his affidavit-in-lieu of his sworn statement, in which, he has reiterated the complaint averments.
5 C.C.No.15048/2015 J9. Prima-facie case has been made out against the Accused and they have been summoned vide the order of the same date.
10. The Accused has appeared before the court and he has been enlarged on bail and the substance of the accusation has been read over to him, to which, he has pleaded not guilty and has stated that, he has the defence to make.
11. In his Post summoning evidence, the Complainant has examined him as PW.1 and he has filed his affidavit-in-lieu of his chief-examination, in which, he has reiterated the complaint averments.
12. In support of his oral evidence, P.W.1 has produced and relied upon the following documentary evidence as per Ex.P.1 to P.9 which is as follows:-
The two Original Cheques dated 23.9.2014 and 26.11.2014 as per Ex.P.1 and Ex.P.2 respectively, the signatures on the said cheques identified by P.W.1 as those of the Accused as per Ex.P.1(a) and P.2(a) respectively, three Bank Memos as per Ex.P.3 to P.5 respectively, the office copy of the Legal Notice as per Ex.P.6, the Postal Receipt as per Ex.P.7, the Postal 6 C.C.No.15048/2015 J Acknowledgement as per Ex.P.8 and the Bank Passbook of P.W.1 as per Ex.P.9
13. P.W.1 has been cross-examined by the learned Defence Counsel.
14. The statement of the Accused as required under Sec. 313 of the Cr.P.C. has been recorded. He has denied the incriminating evidence found against him and has chosen not to lead his rebuttal evidence.
15. The Accused has examined him as D.W.1 on oath under Sec. 315 of the Cr.P.C. The gist of the defence of the Accused is as follows:-
i) That, he knows the Complainant since 4 years;
i) That, the Complainant had lent Rs.1 Lakh to him during the year 2014 and that he repaid the said loan amount of Rs.1 lakh to him in the same year;
ii) That at the time of the lending of the said loan amount, the Complainant had collected the cheque at Ex.P-2 from him towards the repayment of the loan amount of Rs.1 Lakh and thereafter he had collected the cheque at 7 C.C.No.15048/2015 J Ex, P-1 from him for the sum of Rs.1,80,000/=, which was inclusive of the interest of Rs.80,000/- on the principal loan amount of Rs.1 Lakh;
iii) That, even thereafter he did not return the cheque at Ex.P-2 to him and that he has repaid the principal loan amount of Rs.1 Lakh to the Complainant by way of cash in his finance office situated at Jayanagar 4th T Block;
iv) That towards the payment of the interest amount of Rs.80,000/=, my brother Kumar has paid Rs.20,000/= to the Complainant by way of cash in his office at Jayanagar 4th Block in the month of January 2014;
v) That his wife and his brother Kumar have paid Rs.25,000/- by way of cash, in the house of the Complainant;
vi) That he has paid the balance interest amount to him by way of cash;
vii) That he has repaid the said loan amount of Rs.1 Lakh to the Complainant, including the 8 C.C.No.15048/2015 J interest on the said amount to the tune of Rs.80,000/= by way of cash;
viii) That, the claim of the Complainant that, he has advanced a loan of Rs.2,80,000/= to him by way of cash is false;
ix) That the Complainant is a financier by profession;
x) That he has not been served with the legal notice said to have been got issued by the Complainant to him;
xi) That as he has repaid the entire loan amount to the Complainant, that I had borrowed from him, including the interest on the said loan, he is not liable to pay any amount to him and hence he has prayed for his acquittal.
16. D.W.1 is cross-examined by the learned counsel for the Complainant.
17. I have heard the arguments of the learned counsel for the Complainant and the Accused and I have perused the materials on record.
9 C.C.No.15048/2015 J18. Sec.138 of the Negotiable Instruments Act has been enacted to lend credibility to the financial transactions.
The main ingredients of the offence under Sec.138 of the Negotiable Instruments Act are:-
(i) Drawing up of a cheque by the Accused towards payment of an amount of money, for the discharge, in whole or in part, of any debt or any other liability;
(ii) Return of the cheque by the Bank as unpaid;
(iii) The drawer of the cheque fails to make the payment of the said amount of money within 15 days of the receipt of the 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.
19. Apart from this, Sec. 139 of the 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:-10 C.C.No.15048/2015 J
The holder of a cheque received the cheque, of the nature referred to in Sec. 138, for the discharge, in whole or in part, of any debt or other liability".
20. Also, Sec. 118 of the Negotiable Instruments Act states, "Until the contrary is proved, the following presumptions shall be made:-
(a) 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."
21. Thus, the Act clearly lays down presumptions in favour of the Complainant with regard to the issuance of the cheque by the Accused towards the discharge of his liability in favour of the Complainant.
22. 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.
23. It is a well settled position of law that, the defence of the Accused, if in the nature of a mere denial of the case of the Complainant will not be sufficient to 11 C.C.No.15048/2015 J 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.
24. It is also a well settled position of law that, once the cheque is proved to be relating to the Account of the Accused and he accepts and admits the signature on the said cheque, then the initial presumption as contemplated under Sec. 139 of the N.I.Act has to be raised by the courts in favour of the Complainant. The presumption referred to in Sec.139 of the 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 circumstance. But 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.
12 C.C.No.15048/2015 J25. No doubt the initial mandatory statutory presumptions under Sec.118 and 139 of the N.I.Act are in favour of the Complainant. However they are rebuttable presumptions and the Accused is expected to rebut the presumptions by raising a probable defence.
26. Such being the legal position, it would be pertinent to refer to the defences raised by the Accused to rebut the presumptions in favour of the Complainant in this case.
27. Admittedly, there is no dispute with regard to the acquaintance between the parties as well as with regard to the fact that, the cheques in dispute belong to the Accused with his signatures on them and that he has issued them in favour of the Complainant.
28. However, the first and the foremost defence raised by the Accused in the present case is that, though there existed loan transaction between him and the Complainant, it was only to the tune of Rs.1 Lakh. There are inconsistent defences raised by the Accused with regard to the period, during when he claims that, the said loan transaction of Rs.1 Lakh existed between the Complainant and him. Moreover, the Accused has also denied the service of the legal notice upon him.
13 C.C.No.15048/2015 J29. In such circumstance, before proceeding to discuss the matter on merits, it is necessary to consider the technical defence of the alleged non-service of the legal notice on the Accused, since it do touches the question of very maintainability of the complaint.
30. In this regard, it is pertinent to note that, as per the complaint averments, the cheques in dispute, upon presentation returned dishonoured for the reason of "Exceeds Arrangement" and "Account Blocked"
respectively and thereafter the Complainant claims to have got issued the legal notice to the Accused on 23.12.2014 through RPAD, which is claimed to have been duly served upon the Accused on 24.12.2014.
31. In support of this claim, the Complainant has produced the documentary evidence at Ex.P.6, being the office copy of the legal notice, Ex.P.7, being the postal receipt and Ex.P.8, being the postal acknowledgement.
32. However, both in the cross-examination of the Complainant as well as in his chief evidence, the Accused has claimed that, there is no service of the legal notice upon him. In such circumstance, it is necessary that, the Complainant should establish the factum of the service of the legal notice upon the Accused.
14 C.C.No.15048/2015 J33. However, it is pertinent to note that, during his cross-examination, the Accused has pleaded ignorance with regard to the signature of the receiver found on the Postal Acknowledgement at Ex.P.8, but he has admitted the suggestion as true that, his address shown on the Postal Acknowledgment at Ex.P.8 is the address of his residence.
34. No doubt, the Accused has denied the suggestion of the counsel for the Complainant as false that, despite the legal notice, having been served upon him, he was falsely claiming that, there was no service of the legal notice upon him. However, according to the Accused, after he was informed about the present case by the police through phone, he appeared before this court.
35. However, it is a well settled position of law that, when the Accused admits the correctness of his address, to which, the legal notice has been caused to him, the onus of proving that there was no service of the legal notice on him is in his favour.
36. Moreover, in such circumstance, as per Sec.27 of the General Clauses Act, there is deemed service of the legal notice on the Accused, since in the present case he 15 C.C.No.15048/2015 J has admitted the correctness of his residential address. Therefore, the Accused is not entitled to the technical defence of the non service of the legal notice on him.
37. Now coming to another defence of the Accused with regard to the financial capacity of the Complainant, no doubt in the initial course of the cross-examination of the Complainant, when he has specifically deposed that, he had the hard cash of Rs.2,80,000/= in his house, from which, he claims to have lent the loan to the Accused and that he has produced his Bank Statement showing that, he had the amount of Rs.2,80,000/= with him, there is no suggestion put to him by denying his said claim.
38. No doubt, the Complainant had not initially produced his Bank Passbook to substantiate his source of funds at the relevant point of time, subsequently, he has produced his bank Passbook pertaining to his account in the Karnataka Bank as per Ex.P.9 and he has been cross-examined in respect of the said document and it is also elicited from him that, the said bank pass book does not relate to the period, during when, he claims to have lent the loan to the Accused.
16 C.C.No.15048/2015 J39. However, it is interesting to note that, during the initial stage of his cross-examination, when the Complainant had deposed that, he had 6 lorries, among which, presently he has two lorries and that during the year 2014, he had an approximate monthly income of Rs.30,000/= and that apart from doing the business of supplying building materials, he is also doing brokerage business, from which, he claims to have monthly income of Rs.40,000/= to Rs.50,000/= and that, whenever he arranges for the sale of a site, if there is any shortage of funds with the proposed purchaser, he would assist such person financially, there is absolutely no cross- examination of the Complainant on this aspect.
40. With this oral evidence on record, it leads to an inference that, when the Complainant has offered his explanation with regard to his source of income, the same has not been disputed or denied by the Accused. Therefore in so far as the financial capacity of the Complainant to have advanced a loan of Rs.2,60,000/= to the Accused is concerned, there is no serious dispute on the part of the Accused.
41. Now coming to the defence of the Accused that, the Complainant would collect blank cheques for security purpose from the borrowers, it is elicited from 17 C.C.No.15048/2015 J the Complainant in his cross-examination that, he would collect the cheques for the amounts, which the borrowers owe to him.
42. Interestingly, according to the Accused, he had borrowed al loan of Rs.1 Lakh from the Complainant in the year 2008, for the security of which, he claims that he had issued the cheques in dispute to the latter.
43. However, it is interesting to note that, during his chief-examination, the Accused has come up with a claim that, the Complainant had lent Rs.1 Lakh to him during the year 2014 and that he has repaid the said loan of Rs.1 Lakh to him in the same year and that at the time of lending the said loan, the Complainant had collected the cheque at Ex.P.2 for Rs.1 Lakh from him, towards the repayment of the loan and thereafter the cheque at Ex.P.1 for Rs.1,80,000./=, including the interest of Rs.80,000/= on the principal loan amount of Rs.1 Lakh.
44. However, if this defence version of the Accused, is believed to be true, then if according to him, he had already repaid the loan amount of Rs.1 Lakh to the Complainant in the year 2015 itself, as claimed by him in his chief examination, then there was no necessity for 18 C.C.No.15048/2015 J him to issue the cheque at Ex.P.1 for a sum of Rs.1,80,000/= to the Complainant on 23.9.2015 as claimed by him in his cross-examination.
45. Moreover, according to the Accused, though he had given his two cheques in favour of the Complainant in respect of his alleged loan of Rs.1 Lakh, he has come up with a claim that, he has repaid the principal loan amount of Rs.1 Lakh by way of cash in his finance office and the interest amount of Rs.80,000/= also by way of cash through his brother and his wife in the house of the Complainant and the balance interest amount also by way of cash.
46. However, if this defence version of the Accused is believed to be true, then the question that arises is, if according to him, he had already given his two cheques - one for Rs.1 Lakh and the other for Rs.1,80,000/= were already in the possession of the Complainant, then there was no necessity for him to repay either the principal or the interest amount through cash and the same could have been repaid by him to the Complainant through cheques, that were already in the possession of the latter.
19 C.C.No.15048/2015 J47. Therefore, it is clear that, in so far as the alleged earlier loan transaction of Rs.1 Lakh is concerned, the Accused has not taken a consistent stand and on the contrary, while cross-examining the Complainant, the Accused has claimed that, it was Rs.1 Lakh that he had borrowed from the Complainant in the year 2008 and that at that time, the cheques in dispute were issued by him in favour of the Complainant.
48. On the contrary, in his chief examination, the Accused has changed his defence version by claiming that, the said loan transaction of Rs.1 Lakh with the Complainant was in the year 2014.
49. Therefore these inconsistent defences taken by the Accused clearly goes to show that, he has not come up with a probable and consistent defence.
50. Moreover, during the course of his cross- examination, when the Accused has been questioned about the period of his repayment of the loan of Rs.1 Lakh, he has deposed that, he does not remember about the same. However, it is elicited from the Accused that, he has not taken any legal action against the Complainant, after having allegedly repaid loan of Rs.1 Lakh to him by way of cash and that, he had no impediment to collect any document from the 20 C.C.No.15048/2015 J Complainant, in support of his claim that, he has repaid his entire loan amount to him.
51. Therefore, it is clear that, in his anxiety of disproving the case of the Complainant, the Accused has come up inconsistent defences as well as the improbable defence version and as a result, I have no hesitation to conclude that, his defence version is a highly improbable and unbelievable one.
52. It is further pertinent to note that, the Accused has also clearly admitted the suggestion of the counsel for the Complainant as true that, he has no proof of repayment of Rs.1 Lakh in favor of the Complainant.
53. In such circumstance, when the Accused is not at all consistent in his defence version, the difference in the contents of the cheques in dispute - both with regard to the ink as well as with regard to the handwriting does not in any manner support him.
54. Therefore the appreciation of the evidence on record clearly goes to show that, the Complainant has proved his case beyond reasonable doubt and on the other hand, the Accused has failed to rebut the presumptions available in favour of the Complainant u/sec.118 and 139 of the N.I.Act. Accordingly, I proceed to pass the following:-
21 C.C.No.15048/2015 JORDER By exercising the power-conferred u/s 255(2) of Cr.P.C. the Accused is hereby convicted of the offence punishable u/s 138 of the Negotiable Instruments Act.
He is sentenced to pay a fine of Rs.3,00,000/= (Rupees Three Lakhs Only).
If the fine amount is so realized, Rs.2,95,000/= (Rupees Two Lakhs and Ninety Five Thousand Only) is ordered to be paid to the Complainant as Compensation and the balance of Rs.5,000/= (Rupees Five Thousand only) is ordered to be adjusted towards cost to the State Exchequer.
In default of payment of such compensation, the Accused shall undergo Simple Imprisonment for 4 (Four) Months.
His bail bond stands discharged.
Issue free copy of the Judgment to the Accused forthwith.
(Dictated to the Stenographer, transcript thereof is computerized by her, print out taken by her, verified, corrected and then pronounced by me in the open Court on this the 18thday of December, 2018).
(SARASWATHI.K.N), XVI ACMM, Bengaluru City.
ANNEXURE 22 C.C.No.15048/2015 J
1. List of witness/s examined on behalf of the Complainant:-
P.W.1 : Sri.C. Govindaraju Reddy; 2. List of documents exhibited on behalf of the Complainant:- Ex.P.1& P.2 : Original Cheques; Ex.P-1(a) & : Signatures of the Accused; P.2(a) Ex.P.3 to P.5 : Bank Memos; Ex.P.6 : office copy of the Legal Notice Ex.P.7 Postal Receipt; Ex.P.8 : Postal Acknowledgement; Ex.P.9 : Bank Pass book;
3. List of witness/s examined on behalf of the Accused:-
D.W.1 : Sri. K.Neelakrishna Raju @ Babu,
4. List of documents exhibited on behalf of the Accused:-
- Nil -
(SARASWATHI.K.N), XVI ACMM, Bengaluru City.23 C.C.No.15048/2015 J
18.12.2018 Judgment pronounced in the open court vide separate order ORDER By exercising the power-
conferred u/s 255(2) of Cr.P.C. the Accused is hereby convicted of the offence punishable u/s 138 of the Negotiable Instruments Act.
He is sentenced to pay a fine of Rs.3,00,000/= (Rupees Three Lakhs Only).
If the fine amount is so realized, Rs.2,95,000/= (Rupees Two Lakhs and Ninety Five Thousand Only) is ordered to be paid to the Complainant as Compensation and the balance of Rs.5,000/= (Rupees Five Thousand only) is ordered to be adjusted towards cost to the State Exchequer.
In default of payment of such compensation, the Accused shall undergo Simple Imprisonment for 4 (Four) Months.
His bail bond stands
discharged.
Issue free copy of the
Judgment to the Accused forthwith.
XVI ACMM, B'luru.