Bangalore District Court
Sri. Chikkadurgaiah vs Sri on 19 August, 2021
1 CC.No.7214/2018 j
THE COURT OF THE XVI ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE, BENGALURU CITY
Dated: This the 19th day of August, 2021
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. 7214/2018
Complainant : Sri. Chikkadurgaiah
S/o LateDurgaiah,
Aged about 62 years,,
R/at No.36/166, 23rd E Cross,
Behind Valintaince School,
Maruthi Nagar, Ittamadu
Main Raod, BSK III Stage,
Bangalore - 560 085.
Rep. by Sri. Maddurappa.D
Adv.,)
Vs
Accused : Sri, Munikrishnappa
S/o Late Anjinappa,
Aged about 52 years,
R/at No.72, Manjunatha
Nagar,Ittamadu, BSK III Stage,
Bangalore560 085.
(Rep. by Sri. Malleshaiah.,
Adv.,)
Case instituted : 26.02.2018
Offence complained : U/s 138 of N.I Act
of
Plea of Accused : Pleaded not guilty
Final Order : Conviction
Date of order : 19.08.2021
2 CC.No.7214/2018 j
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, he and the accused are well known to each other since 78 years and due to said acquittance the accused approached to him in the first week of August 2016 and requested him for the hand loan of Rs.3,00,000/= to clear his bad debts and urgent family legal necessities and also agreed to repay the same within one year, during the said time he had retried from Bharth Seva Dal and got the retirement amount and agreed to pay hand loan amount to the accused, accordingly he has paid sum of Rs.2,00,000/ by drawing from his bank i.e., State Bank of India Ittamudu Branch, Bengaluru under cheque No. 727837 dated 21.08.2016 and has paid a sum of Rs.50,000/ by way of cheuqe bearing No. 727838 dated 31.08.2016 drawn on State Bank of India Ittamudu Branch, Bengaluru in the name of accused and also drawn an amount of Rs.50,000/ on 31.08.2016 and paid the said amount by way of cash to the accused and in total he has paid a sum of Rs.3,00,000/ to the accused and accused has 3 CC.No.7214/2018 j acknowledged for having received the said amount and thereafter completion of one year, he approached the accused and requested to return the said amount but the accused postponing the same on one or other reason till December 2017. It is further contended by the complainant that on 20.12.2017 he requested and demanded the accused to return of loan amount, the accused has issued cheque bearing No. 117231 dated 11.01.2018 for sum of Rs.3,00,000/ drawn on State Bank of Mysore, Kottanuru Branch, Bengaluru in his favour towards repayment of the hand loan and assured to honor the cheque on its presentation, accordingly he has presented the said cheque through his banker i.e., Federal Bank, Banashankari Branch, Bengaluru on 11.01.2018 but it was returned dishonored with shara "Funds Insufficient" vide memo dated 12.01.2018 and thereafter he informed the accused but accused failed to pay the amount, having no other alternative has got issued legal notice on 27.01.2018 to the accused calling upon him to pay the cheuqe amount within 15 days from the date of receipt of notice and the said notice was served on the accused in spite of it the accused nighter replayed nor complied with the terms of notice. Hence the complainant has filed this present complainant against the Accused for the offence 4 CC.No.7214/2018 j 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 of the complaint. In support of his sworn statement, P.W.1 has relied upon the documentary evidence as per Ex.P.1 to Ex.P.5 i.e, Original Cheque dated:11.01.2018 as per Ex.P.1, the signature on the said cheque identified by P.W.1 as that of the accused as per Ex.P.1(a), Bank Memo as per Ex.P.2, Copy of the Legal Notice dated 27.01.2018 as per Ex.P.3, Postal Receipt as per Ex.P.4 and Postal Acknowledgment as per Ex.P.5 . During the course of trial the complainant has produced his statement of accounts which is at Ex.P6 and relevant entries are marked as EX.P.6(a) and (b).
4. In view of the principles of law laid down and as per the directions 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 he intended to set out he defence, and the case was posted for cross examination of complainant and after cross examination of the complainant has 5 CC.No.7214/2018 j closed his side.
5. Thereafter, the statement of the accused as required under Sec.313 of the Cr.P.C. has been recorded. He has denied the incriminating evidence appearing against his and has chosen to lead his rebuttal evidence, subsequently the accused himself examined as DW1 and also examined one witness by name Sri. Govindaraju as DW.2 and closed his side.
6. Heard the arguments by learned counsel for the complainant and accused and perused the materials on record.
7. On the basis of complaint, evidence of complainant and documents and having heard the arguments of both learned counsels for the complainant and the accused, the following points that are arise for consideration are:
1. Whether the complainant proves that the accused has issued cheque bearing No. 117231 dated: 11.01.2018 for a sum of Rs.3,00,000/= drawn on state Bank of Mysore, Kottananuru Branch, Bengaluru to discharge legally recoverable debt to the complainant and when the complainant has presented the above said cheques for encashment through his banker but the said cheques have been dishonoured for the reasons "Funds Insufficient" on 12.01.2018 and the complainant issued legal notice to the accused on 6 CC.No.7214/2018 j 27.01.2018 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?
8. The above points are answered as under:
Point No.1: In the Affirmative Point No.2:As per final order for the following:
REASONS
9. 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 en cashed 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 persupposes three 7 CC.No.7214/2018 j conditions for prosecution of an offence which are as under:
1. Cheque shall be presented for payment within specified time i.e., from the date of issue or before expiry of its validity.
2. 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
3. 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 three conditions are satisfied by holder in due course gets cause action to launch prosecution against the drawer of the 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.
10. It is also one of the essential ingredients 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 certain presumptions i.e., U/s.118 a presumption shall be raised regarding 'consideration' 'date' 'transfer' 'endorsement' and holder in course of Negotiable Instrument. Even Sec.139 of the Act are 8 CC.No.7214/2018 j rebuttal 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 returnable 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.
11. In the present case the complainant got examined as PW.1 by filing his affidavit evidence wherein he has reiterated the entire averments of the complaint and in his evidence testified that, he and the accused are well known to each other since 78 years and due to said acquittance the accused approached to him in the first week of August 2016 and requested him for the hand loan of Rs.3,00,000/= to clear his bad debts and urgent family legal necessities and also agreed to repay the same within one year, during the said time he was retried from Bharth Seva Dal and got the retirement amount and agreed to pay hand loan amount to the accused, accordingly he has paid sum of Rs.2,00,000/ by drawing from his bank i.e., State Bank of India Ittamudu Branch, Bengaluru under cheque No. 727837 dated 21.08.2016 and has paid a 9 CC.No.7214/2018 j sum of Rs.50,000/ by way of cheuqe bearing No. 727838 dated 31.08.2016 drawn on State Bank of India Ittamudu Branch, Bengaluru in the name of accused and also drawn an amount of Rs.50,000/ on 31.08.2016 and paid the said amount by way of cash to the accused and in total he has paid a sum of Rs.3,00,000/ to the accused and accused has acknowledged for having received the said amount and thereafter completion of one year he approached the accused and requested to return the said amount but the accused was postponing the same on one or other reason till December 2017. The complainant/PW.1 further testified that on 20.12.2017 he requested and demanded the accused to return for loan amount, the accused has issued cheque bearing No. 117237 dated 11.01.2018 for sum of Rs.3,00,000/ drawn on State Bank of Mysore, Kottanuru Branch, Bengaluru in his favour towards repayment of the hand loan and assured to honour the cheque on its presentation, accordingly he ahs presented the said cheque through his banker i.e., Federal Bank, Banashankari Brnach, Bengaluru on 11.01.2018 but it was returned dishonoured with shara "Funds Insufficient" vide memo dated 12.01.2018 and thereafter he informed the accused but accused failed to pay the amount, having no other alternative has got issued legal 10 CC.No.7214/2018 j notice on 27.01.2018 to the accused calling upon him to pay the cheuqe amount within 15 days from the date of receipt of notice and the said notice was served on the accused in spite of it the accused neighter replayed nor complied with the terms of notice.
12. In support of oral evidence, P.W.1 has relied upon the documentary evidence as per Ex.P.1 to Ex.P.5 i.e, Original Cheque dated:11.01.2018 as per Ex.P.1, the signature on the said cheque identified by P.W.1 as that of the accused as per Ex.P.1(a), Bank Memo as per Ex.P.2, Copy of the Legal Notice dated 27.01.2018 as per Ex.P.3, Postal Receipt as per Ex.P.4 and Postal Acknowledgment as per Ex.P.5 . Statement of accounts of the complainant which at Ex.P6 and relevant entries are marked as Ex.P.6(a) and (b).
13. In the present case, there is no dispute between the complainant and Accused with regard to their acquaintance. It is also not in dispute by the accused that, the cheque in question belongs to his account and signature found at Ex.P.1(a) is also that of his signature. The Accused has also not disputed that the cheque in dispute presented for encashment and dishonoured for the reason of "Funds Insufficient" vide bank endorsement 11 CC.No.7214/2018 j dated:12.01.2018, therefore as a matter on record and has been proved by Ex.P.2 issued by the concerned bank dated: 12.01.2018. Therefore the complainant has proved that, the cheque in question i.e Ex.P.1 was presented within its validity period and dishonoured as per bank endorsement issued by the banker of the Accused and the cheque in question belonging to the Accused account and signature of the Accused is at Ex.P.1(a).
14. In relation to the service of notice the Accused in his defence evidence has not denied service of notice upon him. The complainant in order to prove service of notice upon the Accused, has produced the documents i.e copy of the legal notice, postal receipt, postal acknowledgement which are at Ex. P.3 to P.5 respectively. The accused/ DW1 during the course of his crossexamination has admitted that the legal notice dated 27.01.2018 sent by the complainant was received by him. Hence the complainant has also proved that after receipt of the bank memo i.e., Ex.P2 within 30 days from the date of receipt of endorsement issued by the bank has issued the legal notice on 27.01.2018 as per Ex.P.3 through RPAD and same was served on the accused. Hence the complainant has complied mandatory requirements as required U/sec 138 (a) to (c) of Negotiable Instrument Act. Therefore initial 12 CC.No.7214/2018 j presumption can be drawn in favour of the complainant u/sec 118(a) and 139 of N.I. Act.
15. It is also the defence of the Accused that, the complainant has no source of income to lend the loan amount in question and has not produced any documents to show that, he has paid a loan amount of Rs.3,00,000/ to the accused. In this regard the learned counsel for the accused has cross examined the complainant, but nothing has been elicited to discredit or discard the evidence of the complainant. On entire perusal of the crossexamination except the suggestions made to the complainant with regard to collection of document for having lent the loan amount to the accused, nothing has been elicited to believe the defense of the accused. It is true that the complainant has admitted that he has no hindrance to lend the loan amount to the accused through cheque but the complainant has specifically stated that he has paid the loan amount in cash as the accused was in need of urgent money and as per his request paid the loan amount by way of cash, therefore mere nonlending of loan amount in question by way of cheuqe does not itself vitiates the transaction in question. The complainant has also produced his bank account statement which is Ex.P 6 and the relevant entries dated 21.08.2016 and 31.08.2016 marked as Ex.P6(a) & (b) wherein it is 13 CC.No.7214/2018 j seen that an amount of Rs.2,00,000/ was withdrawn by the complainant on 28.08.2016 and an amount of Rs.50,000/ was transferred through cheque in the name of accused from the account of the complainant, therefore in view of Ex.P6(a) & (b) it can be held that the complainant has produced the bank statements to show his financial capacity to lend the loan amount to the accused and the perusal of Ex.P6 it appears that the complainant was having sufficient funds in his account to lend the loan amount to the accused. The complainant/PW1 has denied the suggestions made to him that the accused had obtained only an amount of Rs.50,000/ from him and has issued a blank signed cheuqe pertains to SBM account towards security of the said amount of Rs.50,000/ and the accused also paid an amount of Rs.26,000/ total interest amount for the period of 13 months Rs.2,000/ each month, but the said suggestion was denied by the complainant. The complainant/PW.1 has also denied the suggestions that he has not paid Rs.3,00,000/ to the accused but has paid only Rs.50,000/ and has collected blank signed cheque towards security of the said amount and misused the said cheuqe by filling this false case, in such circumstances it can be held that, the accused has failed to elicit materials to disbelieve the evidence of 14 CC.No.7214/2018 j complainant.
16. It is important to note here that, on careful perusal of the entire oral and documentary evidence produced by the complainant i.e Ex.P.1 to P.6 and admitted facts by the Accused, the complainant proved that the cheque in question belongs to the Accused i.e Ex.P.1 and signature found at Ex.P.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.P.2 and thereafter the legal notice caused by him through RPAD to the Accused was served on him and Accused has not given any reply to the legal notice, in such circumstances, it can be held that, the complainant has discharged her 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.118a and 139 of the N.I.Act. Consequently it is for the Accused to rebut the said 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 15 CC.No.7214/2018 j 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. In this regard it is relevant here to refer the decisions reported in 2001 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 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 16 CC.No.7214/2018 j 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 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 17 CC.No.7214/2018 j while examining if the 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.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 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 18 CC.No.7214/2018 j 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 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 19 CC.No.7214/2018 j 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 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". 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 20 CC.No.7214/2018 j 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.118a 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 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 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 him and signature appearing on the cheque is that of his signature and even after service of the notice, the Accused has not given any reply or complied the terms of the notice, in such circumstances, presumptions have to be drawn towards existence of legally enforceable debt as per Sec.139 of N.I.Act. Therefore, for the above said reasons the defence taken by the Accused that, the 21 CC.No.7214/2018 j complainant has not produced the documents to show that, he has lent loan amount of Rs.3,00,000/ to the accused and has not produced the documents to show that, he has paid the amount to the accused cannot be acceptable one. The defence taken by the Accused appears that, the complainant has to prove his claim by producing his evidence as if it is required for proving of his debt before the Civil Court, but same cannot be permissible in a proceedings 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 him and signature found on the cheque in question is also that of his signature.
17. In order to rebut the presumptions available to the complainant and to substantiate the defence of the accused, the accused himself examined as DW.1. The accused/DW.1 in his evidence stated that, he know the complainant and he required financial assistance and approached the complainant requested him to lend loan of RS.50,000/ for which the complainant demanded 22 CC.No.7214/2018 j him to pay interest @ of 4% per month and to issue a blank signed cheque, at that time he had given his blank signed cheque and after 3 days the complainant brought him to the bank and drawn an amount of Rs.50,000/ through his cheque and has given the said amount to him. The accused/DW1 further deposed that he has paid interest of Rs.2,000/ per month in total an amount of Rs.16,000/ towards interest to the complainant and thereafter he did not paid interest amount since he had no work to earn, thereafter the complainant had filed this complaint against him, by misusing his blank cheque.
18. The accused in order to prove his defence except his self serving statements i.e., oral evidence nothing has been produced documentary evidence to substantiate his defence, i.e., the complainant has lent only an amount of Rs.50,000/ and inturn has paid interest of Rs.2,000/ per month and in total Rs.16,000/ interest to the complainant. The accused has also not produced any proof to show that the complainant had collected his blank signed cheque and has not stated on which date, month and year he approached the complainant and requested to lend loan amount of Rs.50,000/ and has not mentioned date, month and year on which 23 CC.No.7214/2018 j the complainant lend loan amount of RS.50,000/ to him and also not stated a cheque No. which was allegedly collected by the complainant, therefore mere oral evidence without there being any supportive evidence cannot be acceptable one.
19. The accused has also examined one witness by name Sri. Govindaraju as DW2 who in his evidence stated that, he knows the complainant and accused since 78 years as they are his friends and he was informed by the accused that he was in need of Rs.50,000/ for his family necessities, at that time they are aware that the complainant used to lend the money on interest basis, accordingly on 28.08.2016 he and accused and one Umesh went to the house of complainant requested to lend amount for that, the complainant agreed to lend the amount, but on interest @ of 4% per month and also demanded one signed blank cheque from the accused and thereafter on 31.08.2016 the complainant has withdrawn an amount of RS.50,000/ through his cheque from Fedral Bank and said amount has been given to the accused and the accused has paid interest of RS.2,000/ per month to the complainant, except the said loan transaction of Rs.50,000/ there were no other financial translation between the complainant and accused and the complainant has not lend loan 24 CC.No.7214/2018 j amount of RS.3,00,000/ to the accused.
20. It is relevant here to mention that the DW2 during the course of crossexamination has specifically admitted that he does not know the accused has borrowed a loan of RS.3,00,000/ from the complainant, hence it goes to show that if really the DW2 knows the real transactions between the accused and complainant or if accused has borrowed only Rs.50,000/ from the complainant, definitely would have stated this fact in his crossexamination but even has not denied the suggestion that accused has borrowed loan of Rs.3,00,000/, therefore the evidence of DW2 is not helpful for the accused to prove his defence. It is also important here to note that the accused during the course of cross examination of the complainant or during the course of his evidence no where stated that the DW2 i.e., Sri. Govindaraju was also present at the time of alleged borrowing of Rs.50,000/ from the complainant and at that time the complainant had also collected blank signed cheuqe of the accused, therefore the accused only in order to fill up lacuna in his defence and to improve his defence has setup new story and examined the DW2, therefore the evidence of the DW2 cannot be acceptable one. If really the DW2 was presented at the time of alleged 25 CC.No.7214/2018 j borrowing of loan amount of Rs.50,000/, definitely the accused would have revealed this fact by giving replay to the notice of the accused at the first instance only, but inspite of receipt of legal notice the accused has not disclosed the alleged borrowing of Rs.50,000/ from the complainant and inturn the complainant had collected his blank signed cheque, therefore the defence setup by the accused for the first time before the court that too without their being any proof cannot be acceptable one.
21. It is the specific defence of the accused that, he had borrowed a loan of Rs.50,000/ from the complainant at that time the complainant had collected his blank signed cheque for security of the loan amount and thereafter he has paid interest of amount of RS.16,000/ in total i.e., Rs.2,000/ per month to the complainant and thereafter he did not paid interest amount, the complainant has filed this case by misusing his cheuqe by creating false story but as it is already held in the above that, the accused has not produced any documentary proof or satisfactory evidence to prove his defence i.e., the complainant had collected his blank signed cheque at the time of lending of Rs.50,000/ loan amount to him and in turn he has paid the interest amount to the complainant, therefore the defence of the accused cannot be acceptable one. If really the 26 CC.No.7214/2018 j complainant had collected blank signed cheque of the Accused i.e., the disputed cheque as a security towards the loan transaction and the said cheque is misused by the complainant, definitely the accused would have initiated action against the complainant by issuing replay to the legal notice, or by filing police complaint or by initiating legal action before the court of law against the complainant alleging that, even after payment of interest to the complainant he has misused his signed blank cheque by filing this complaint, but no such efforts have been made by the accused, in such circumstances an adverse inference can be drawn against the Accused that, in order to overcome the liability in question the Accused has taken such defence and same cannot be acceptable one. 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 27 CC.No.7214/2018 j 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 towards discharge of such debt Conviction, Proper." Hence by applying the above principles of law to the present facts of the case in the present case, the Accused has not produced any document to prove his defence, under such circumstances, it can be held that, the accused has not made any efforts to get return of the cheque in question alleged to have been collected by the complainant as a security towards the alleged loan amount borrowed by him and the said cheque has been misused by the complainant under such circumstances, the said unnatural conduct of the accused in non taking of action may leads to draw an adverse inference 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 him, as he has admitted the 28 CC.No.7214/2018 j signature and cheque in questions belongs to him.
22. It is also the specific defence of the Accused that, the complainant had collected his signed blank cheque i.e., the cheque in question as a security at the time of lending of loan amount of Rs.50,000/ to him and even after payment of interest made by him the complainant has misused the cheque in question and has filed this false complaint against him. But as it is already held in the above that, the Accused has miserably failed to prove that, he has borrowed the loan amount of Rs.50,000/ from the complainant and at the time of advancing the loan the complainant has collected his blank signed cheque as alleged by him, in such circumstances the defence taken by the Accused cannot be acceptable one, on the contrary the fact of receiving of loan amount and issuance of cheque remained as it is, in such circumstances also it can be held that, the cheque in question has been issued by the Accused towards discharge of the loan transaction in question as the Accused has miserably failed to prove his defence. In this regard, it is also relevant here to refer the decisions 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 29 CC.No.7214/2018 j 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. 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 INSTRUMENT Act, 1881 Section s138 and 139 - acquittal - If justified Accused not disputing issuance of cheque and his signature eon 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 evidence to case of accused Acquittal not proper. Hence the Hon'ble High Court of Karnataka in the above said decisions clearly held that, if the Accused has taken defence that, the 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 it is 30 CC.No.7214/2018 j for the accused to prove his defence by producing cogent and convincible evidence, if the Accused has not proved the same in such circumstances, it cannot be held that, the cheque in question was issued for the purpose of security in connection with the transaction. In the present case also the Accused has failed to establish his defence that, the cheque in question was collected by the complainant in respect of the alleged loan transaction and misused by him by filling this complaint, under such circumstances the cheque so issued cannot be considered as the one issued as stated by the accused in his defense and the defence taken by the Accused is untenable one. Therefore for the above said reasons the arguments canvassed by the learned counsel for the defence cannot be acceptable one or not sustainable.
23. 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 him and he has failed to prove his defence and how the cheque in question has come to the possession of the Complainant, this would also give rise to an adverse inference against him. 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. 31 CC.No.7214/2018 j 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". 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.
24. 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, he has lent an amount of Rs.3,00,000/ to the Accused and in turn the Accused has issued the Ex.P.1 cheque in question in his favour 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 and the said notice was served on him, inspite of it, 32 CC.No.7214/2018 j the Accused did not paid the cheque amount, 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.P.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.
25. 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 cheques 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 his 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 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 : 33 CC.No.7214/2018 j 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) within one month from the date of order, in default he shall under go simple imprisonment for a period of (1) one month 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) shall be defrayed as prosecution expenses to the state.
The Bail bond of the Accused stands cancelled.
Office is directed to refund the cash security of Rs.3,000/ deposited by the accused on 10.08.2018 (if not lapsed) in the name of the accused after the appeal period is over.
34 CC.No.7214/2018 jOffice 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 19th August 2021).
(SRI.S.B. HANDRAL), XVI ACMM, Bengaluru City.
ANNEXURE
1. List of witness/s examined on behalf of the Complainant: PW1 : Sri. Chikkadurgaiah
2. List of documents exhibited on behalf of the Complainant: Ex.P.1 : Original Cheque, Ex.P.1(a) : Signature of the accused, Ex.P.2 : Bank Memo, Ex.P.3 : Copy of the Legal Notice, Ex.P.4 : Postal Receipt, Ex.P.5 : Postal Acknowledgment, Ex.P.6 : Bank Statement Ex.P.6(a) : Relavant Entries.
& 6(b)
3. List of witness/s examined on behalf of the Accused: DW.1 : Munikrishna DW.2 : Govindaraju.
35 CC.No.7214/2018 j4. List of documents exhibited on behalf of the Accused: NIL (SRI.S.B.HANDRAL), XVI ACMM, Bengaluru City.
36 CC.No.7214/2018 j19.08.2021 Case called out, Counsel for the complainant and complainant absent. Accused present, Counsel for the accused present, Judgment pronounced vide separate judgment.
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) within one month from the date of order, in default he shall under go simple imprisonment for a period of (1) one month 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) shall be defrayed as prosecution expenses to the state.
The Bail bond of the Accused stands cancelled.
Office is directed to refund the cash security of Rs.3,000/ 37 CC.No.7214/2018 j deposited by the accused on 10.08.2018 (if not lapsed) in the name of the accused after the 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.
XVI ACMM, B'luru.
Accused present, Application U/Sec 389(3) of Cr.P.C. has been filed on behalf of accused.
In order to enable the accused to prefer an appeal against the sentence imposed against him it is considered just and proper to suspend the execution of sentence of fine and thereafter proceed with the matter.
Office is directed to take bond from the accused for a sum of Rs.3,15,000/ and keep the same in the file.
Accordingly the execution of the sentence of fine is suspended till 20.09.2021 and call this case on 21.09.2021.
XVI ACMM, B'luru.
38 CC.No.7214/2018 j