Bangalore District Court
M/S Gajavadana Chits Pvt. Ltd vs Sri. N. Govindaraju on 25 October, 2024
C.C.NO.39385/2022
0
KABC030911532022
Presented on : 28-12-2022
Registered on : 29-12-2022
Decided on : 25-10-2024
Duration : 1 years, 9 months, 28 days
IN THE COURT OF THE XXVIII ADDL. CHIEF JUDICIAL
MAGISTRATE, BENGALURU CITY
Present:
Soubhagya.B.Bhusher,
B.A.,LL.B.,LL.M
XXVIII A.C.J.M, Bengaluru City.
DATED: THIS THE 25th DAY OF OCTOBER-2024
C.C.NO.39385/2022
Complainant: M/s. Gajavadana Chits Pvt.,Ltd (Regd),
Having registered office at No.21,
2nd Floor, Rushabh Mansion,
6th Cross, Opp: Allahabad Bank,
Samipge Road, Malleswaram,
Bengaluru-03, R/by its Managing Director,
Sri.Varadaraju,
(By Sri.S.S.Associates & Advocates.,)
V/s
Accused: Sri.N.Govindaraju S/o Narayan,
Age: 45 years, R/at No.77/2, 8th Cross,
Nala Road, Sudhama Nagara,
Near Masjid, Bengaluru-27.
(By Sri.Sanjay.R.,Adv.,)
:JUDGMENT:
This case arises out of the private complaint filed by the complainant against the accused under section C.C.NO.39385/2022 1 200 of Cr.P.C., for the offence punishable under section 138 of N.I.Act.
2. The case of the complainant's in brief is as under:
It is the case of the complainant is that the accused is one of the subscriber/member in chit group No.G2A-115, ticket No.3, chit value of Rs.3,00,000/- payable of Rs.15,000/- over a period of 20 months. The said chit amount was bided by the accused for Rs.72,000/- in chit auction dated:10.01.2019 and he has received prized chit amount of Rs.2,28,000/- through cheque on 27.02.2019 and on the same day he had executed a receipt/voucher along with on demand promissory note. The accused has paid monthly chit subscription amount of Rs.15,000/- including dividend amount of Rs.2,25,000/-, thereafter he has not paid the subscription amount of Rs.74,950/- and the said chit was ended on March-2020. Therefore, on 17.09.2022 the complainant had issued a demand notice to the accused calling upon him to pay the balance subscription due amount and interest of Rs.1,19,920/-. After issuance of demand notice the accused during the 1st week of October-2022 had issued a post dated cheque No.210633 dated: 07.10.2022 drawn on M/s. Bharath Co-operative Bank, Double Road Branch, Bengaluru. The complainant was presented the said cheque on 10.10.2022 for realization through its banker C.C.NO.39385/2022 2 M/s. Karur Vysya Bank Ltd., Malleshwaram Branch, Bengaluru. But the said cheque was dishonored on 11.10.2022 as "Funds Insufficient". Thereafter, on 09.11.2022 the complainant got issued a legal notice to the accused through its counsel calling upon him to pay the said cheque amount to the complainant. The said notice was returned on 10.11.2022 as "not claimed".
Inspite of issuance of the notice, the accused neither reply to the notice nor paid the cheque amount. As such, the accused have committed an offence punishable under section 138 of N.I.Act. Hence, the present complaint came to be filed before this court on 20.12.2022.
3. After the complaint was filed, the cognizance of the offence cited therein was taken. Sworn statement of the complainant was recorded. Since there were sufficient materials to proceed against the accused, an order was passed on 20.12.2022 to register the case in Register No.III and it was registered as a criminal case.
4. Thereafter, summons was issued to the accused and he has appeared before the court through advocate and secured bail. He was furnished its necessary papers as complied under section 208 of Cr.P.C. Thereafter, the plea of the accused was recorded by the court. He has pleaded not guilty and claimed to be tried.
5. The complainant in support of its case have C.C.NO.39385/2022 3 examined its Managing Director as PW.1 and got marked 11 documents at Ex.P.1 to 11 and closed its side.
6. After closer of the evidence of the complainant, the statement of the accused under section 313 of Cr.P.C, was recorded. He has denied the incriminating evidence appearing against him. In his defence, the accused examined himself as DW.1 and one document was marked at Ex.D.1.
7. Heard the arguments on both the sides and perused the material placed on record.
8. Upon hearing the arguments and on perusal of the material placed on record, the following points arise for my consideration:
1.Whether the complainant proves the existence of legally enforceable debt/liability.?
2.Whether the complainant further proves that the accused had issued the cheque-
Ex.P.1, towards the discharge of the said legally enforceable debt/liability.?
3.Whether the complainant further proves that the cheque-Ex.P.1 was dishonored for the reasons "Funds Insufficient" and thereafter the accused had failed to repay the same within the statutory period, inspite of receipt of legal notice.?
4.Whether the accused have thus committed an offence punishable under section 138 of N.I.Act.?
5. What order?
C.C.NO.39385/2022 4
9. My answers to the above points are as under:
Point No.1: In the Affirmative Point No.2: In the Affirmative Point No.3: In the Affirmative Point No.4: In the Affirmative Point No.5: As per final order, for the following:
:REASONS:
10.POINT NO.1 AND 2: These two points are inter-related to each other and finding given on any one point will bearing on the another. Hence, in order to avoid repetition of facts and evidence, I have taken these two points together for common discussion. The case of the complainant is that he was acquainted with the accused. The accused is one of the subscriber/member in chit group No.G2A-115, ticket No.3, chit value of Rs.3,00,000/- payable of Rs.15,000/- each over a period of 20 months. The said chit amount was bided by the accused for Rs.72,000/- and he has received the prized chit amount of Rs.2,28,000/- and he had executed a receipt/voucher along-with on demand promissory note. The accused has paid monthly chit subscription amount of Rs.15,000/- including dividend amount of Rs.2,25,000/- thereafter he has not paid the subscription amount and the said chit was ended on March-2020. Therefore, the complainant had issued a demand notice to the accused calling upon him to pay the balance C.C.NO.39385/2022 5 subscription due amount and interest of Rs.1,19,920/-. After issuance of demand notice the accused had issued a post dated cheque in question. The complainant was presented the said cheque for realization through its banker. But the said cheque was dishonored as "Funds Insufficient". Thereafter, the complainant got issued a legal notice to the accused through its counsel calling upon him to pay the said cheque amount. After issuance of the notice, the accused neither reply to the notice nor paid the cheque amount. As such, the accused have committed an offence punishable under section 138 of N.I.Act. Hence, the present complaint came to be filed before this court.
11. In support of the case, the complainant's have examined its Managing Director as P.W.1 and 11 documents were marked at Ex.P.1 to 11. In the chief examination P.W.1 has repeated the contents taken by the complainant in the complaint. Ex.P.1 is the cheque issued by the accused in favour of the complainant dated: 07.10.2022 for Rs.1,19,920/-. Ex.P.1(a) is the signature of the accused. Ex.P.2 is the bank memo dated: 11.10.2022 informing the dishonor of the cheque as "Funds Insufficient". Ex.P.3 is the office copy of legal notice dated: 09.11.2022. Ex.P.4 is the postal receipt. Ex.P.5 is the returned postal cover. Ex.P.5(a) is the returned legal notice. Ex.P.6 is the Minutes of meeting.
C.C.NO.39385/2022 6 Ex.P.7 is the chit payment voucher. Ex.P.8 is the demand promissory note. Ex.P.9 is the demand notice. Ex.P.10 is the postal receipt. Ex.P.11 is the complaint.
12. In order to prove his defence, the accused examined himself as DW.1 and one document was marked at Ex.D.1. In his evidence he deposed defence taken by him. It is further deposed that after bidding the chit he has received Rs.2,00,000/- amount. Further deposed that at that time the complainant has received two blank cheques and obtained his signature on the agreement. Further deposed that handwriting appeared on the cheque is not belongs to him. Further deposed that he has paid Rs.2,25,000/- and he has also paid Rs.50,000/- by way of cash. Further deposed that he has already paid entire amount to the complainant and there is no any due to the complainant. Further deposed that the complainant have misused his blank cheque and filed this false case. Further he prays to dismissed the case and acquit him. Ex.D.1 is the passbook.
13. In order to attract the offence punishable under section 138 of N.I.Act, the complainant is firstly required to prove the existence of legally enforceable debt/liability, for which the cheque came to be issued. The learned counsel for the complainant has argued that from the evidence placed on record, the fact that the accused is a subscriber in the complainant branch C.C.NO.39385/2022 7 and he has entered into a chit value of Rs.3,00,000/- for the period of 20 months payable at Rs.15,000/- per month. The accused had participated in the chit auction and he bid chit amount of Rs.72,000/- and had received prize money of Rs.2,28,000/-. Thereafter the accused had executed necessary documents in favour of the complainant. After receiving the prized money the accused has failed to repay the chit subscription amount along-with interest amount. The complainant has issued a demand notice to the accused, thereafter the accused in order to repayment of debt/liability had issued the cheque-Ex.P.1 in favour of the complainant. He further argued that the accused has not denied Ex.P.1 being his cheque drawn on his account. When the signature is not disputed, the presumption under section 139 N.I.Act is to be drawn in favour of the complainant. The accused has failed to elicit anything in the cross examination of P.W.1 to disbelieve the said evidence. The defence have failed to rebut the presumption under section 139 N.I.Act.
14. He further argued that the accused has failed to produce any believable evidence that he had issued two blank cheques in favour of the complainant at the time of receiving the chit amount and also the defence why he has not returned back the same is not clear. He further argued that under section 139 of N.I.Act, there is a presumption that the cheque has been issued for C.C.NO.39385/2022 8 discharge of legally enforceable debt/liability. In the present case, the accused has not disputed Ex.P.1 being his cheque drawn on his account. The said presumption is available to the complainant. Further he has argued that the accused has failed to prove the very fact that the cheque was given to the complainant for the purpose of security and it was blank when it was given to the complainant. Moreover, under section 118 of N.I.Act, there is a presumption that the Negotiable Instruments is drawn on the date, for the amount and in favour of the person as shown in it. It is for the accused to rebut the said presumption. But in the case on hand no such evidence forthcoming. It was also argued by him that as per the defence by the accused that he had given two blank cheques to the complainant. As such, very defence of the accused is not believable. He further argued that the accused has not produced any documentary evidence to prove his defence. Upon careful perusal of the entire evidence of records both oral and documentary evidence the complainant have proved their case.
15. It was further argued that the accused has miserable failed to prove the said fact. It is specific case of the accused that he has already paid entire installments amount to the complainant. But the accused not produced any documents. Further the materials available on record clearly established that C.C.NO.39385/2022 9 the accused admitted the issuance of cheque to the complainant. The initial burden is on the complainant to prove that the cheque was issued in favour of the complainant, then onus shifts upon the accused to prove his defence and it is for the accused to rebut the legal presumption enumerated under section 138 of Negotiable Instruments Act. As per presumption the cheque was issued for discharge of legal liability and it is for the accused to rebut the said presumption by adducing the cogent and convincing evidence. It was further argued that under facts and circumstances of the case the complainant have proved that the accused had issued the cheque in question in favour of the complainant for repayment of amount. On the contrary, the accused utterly failed to prove his probable defence. Hence, he prays to convict the accused.
16. The leaned counsel for the accused has argued that there was no legally enforceable debt/liability to the complainant from the accused for which the cheque-Ex.P.1 was issued. Further argued that the accused had issued two blank cheques to the complainant for the purpose of security. Further argued that the accused has already paid entire amount to the complainant. When the accused has paid entire amount to the complainant, then question of issuance of the cheque does not arise at all. The complainant company misused one of the security cheque and filed C.C.NO.39385/2022 10 a false case against the accused. In order to attract the offence punishable under section 138 of N.I.Act, the complainant is firstly required to prove the existence of a legally enforceable debt/liability, for which the cheque came to be issued. Therefore, from the evidence placed on record, the very due amount of the accused is not clearly made out whereas the accused is succeeded in rebutting the presumption available under section 139 of N.I.Act regarding existence of legally enforceable debt/liability. He further argued that the complainant have not lead any additional evidence in support of their case and after closer of the complainant evidence the accused himself has examined as DW.1. It is further argued that the Apex court has come down heavily on misuse of provisions of N.I.Act and more particularity on section 138 which fetters the hands to the court to largely draw a presumption in favour the complainant.
17. It is further argued that the Apex court has settled the law in the catena of judgments that the existence of legally enforceable debt/liability has to prima facia to be proved to be complainant and that such a debt to be legally enforceable debt being a debt in true sense in the instance case the complainant has failed to prove the same. The act clearly lays down presumptions in favour of the complainant with regard to issuance of the cheque by the accused towards the C.C.NO.39385/2022 11 discharge of his liability in favour of the complainant 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. The facts narrated above clearly demonstrate that the complainant have got no legally enforceable debts from the accused. Further argued that it is clear from the evidence on record, the complainant has miserably failed to establish the transaction in question as claimed by him and on the contrary, the accused has been successful in eliciting the serious doubtful circumstances in the case of the complainant and in such circumstances, the benefit of such doubts need to be extended to the accused. The case of the complainant is liable to be dis-believed, since the same suffers from serious omissions, contradictions and suspicious circumstances and on the other hand, the accused has probabalized his defence and as such, his defence is sufficient to rebut the presumption available in favour of the complainant under section 118 and 139 of the N.I.Act. The complainant has filed this complaint for illegal gain from the accused by misusing the cheque. Hence, he prays to acquit the accused.
18. In the case on hand the complainant and the accused having some transaction has not been seriously disputed by the accused. Further the accused has not seriously disputed he had issued the cheque-
C.C.NO.39385/2022 12 Ex.P.1 in favour of the complainant. It is not disputed that the complainant is a private limited chits company and the accused was a subscriber and businessman. Whereas, the accused has contended that he had given two chaques to the complainant for the purpose of security at the time of receiving the chit amount. When he had given cheques, which were blank. The accused has specifically denied having debt/liability had issued the cheque-Ex.P.1 on 07.10.2022 towards the discharge of any debt/liability. He contends that the blank cheques given by him to the complainant for the purpose of security, one of the cheque as was misused by the complainant and the false complaint was filed.
19. In order to attract the offence punishable under section 138 of N.I.Act, the main ingredients of the existence of the legally enforceable debt/liability, for which the cheque drawn on the account of the accused was given for discharge of the same, are to be proved. The complainant's in order to prove its case, have examined its Managing Director as PW.1 and 11 documents were marked at Ex.P.1 to 11. In chief examination P.W.1 has repeated the averments made by the complainant in the complaint. In the present case, the accused has not disputed Ex.P.1 being his cheque drawn on his account. The said presumption is available to the complainant.
20. As per the section 139 of N.I.Act, there is a C.C.NO.39385/2022 13 presumption regarding the existence of legally enforceable debt/liability. Such presumption is rebuttable presumption and it is opinion to the accused to raise defence discharging the existence of a legally enforceable debt/liability. In the case on hand also the accused has disputed the existence of legally enforceable debt/liability, for which cheque-Ex.P.1 was issued. In order to prove his defence, the accused has failed to produce any documentary evidence before this court. PW.1 during his cross-examination has specifically denied the suggestions made to him.
21. Since, the presumption under section 139 of N.I.Act is a rebuttable presumption the accused is firstly required to produce some probable evidence to rebut the same. Though in the criminal cases, the standard of the proof required for the accused is not so strict as required for the complainant to prove the case. Further the accused has to produce some probable evidence, which creates doubt about the existence of legally enforceable debt/liability. In the present case, as per the defence taken by the accused is that he had given two blank cheques to the complainant company at the time of receiving the chit amount and he has already paid entire amount. Except, the said defence, he has not produced any materials to prove such defence. If he had given two blank cheques to the complainant, what prevented the accused to file the complaint C.C.NO.39385/2022 14 immediately after the alleged illegal act made by the complainant. Further what prevented the accused to file the complaint against the complainant for misusing of the alleged cheque. On which date he came to knew about the alleged illegal act of the complainant, he did not whisper about on what date he came to know the alleged cheque illegally misused by the complainant. Admittedly the accused is having knowledge of the financial transaction, why he has given blank cheques to the complainant without anticipating the consequence is not explained by him. So also, he has not stated anything as to what steps he took to receive back the blank cheques. Moreover, immediately after the alleged blank cheque misused by the complainant he has not lodge complaint before concerned police station. No steps have been taken to receive back the blank cheques, after he came to know about the same.
22. Once issuance of cheque and signature are admitted, the statutory presumptions would arise under sections 118 and 139 of the N.I.Act that the cheque was issued by the drawer for legally payable debt/liability and for valid consideration. The Hon'ble Supreme Court has held in the case of Rangappa V/S Mohan, reported in 2010 AIR SCW 296, the presumption that the cheque was drawn in discharge of legally recoverable debt is a presumption of law that ought to be raised in every case, though, it is a C.C.NO.39385/2022 15 rebuttable presumption. Off course, the presumption under section 139 and 118 of the N.I.Act are rebuttal presumption. Further it is also held that mere plausible explanation by the drawer is not sufficient and proof of that explanation is necessary. The principle of law laid down in the above decision is applicable to the facts of this case. In the instant case, since the complainant is in possession of the cheque-Ex.P.1 the court has to draw the initial presumption that he is the payee of that cheque. Once the initial burden is discharged by the complainant, the onus shifts on the accused to rebut the complainant's case.
23. In the case of K.S.Ranganatha V/s Vittal Shetty, reported in 2021 SCC Online SC 1191, the Hon'ble Supreme Court held that once the cheque is admitted to be that of the accused, the presumption envisaged in section 118 of the Act can legally be inferred that the cheque was made or drawn for consideration on the date which the cheque bears. Section 139 of the Act enjoins on the court to presume that the holder of the cheque received it for the discharge of any debt/liability. It is further held that the position of law makes it crystal clear that when a cheque is drawn out and is relied upon by drawee, it will raise a presumption that it is drawn towards a consideration which is a legally recoverable amount; such presumption of course, is rebuttable by proving to C.C.NO.39385/2022 16 the contrary. The onus is on the accused to raise a probable defence and the standard of proof for rebutting the presumption is on preponderance of probabilities.
`24. In the case of M/s Kalemani Tex V/s P.Balansubramanian, reported in (2021) 5 SCC 283, the Hon'ble Apex Court has observed that even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under section 139 of the Negotiable instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt.
25. In the present case also, as the accused never disputed his signature and did not deny issuing cheque from the account of the accused. The accused did not dispute cheque return memo also. The cheque was returned for the reasons "Funds Insufficient". 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 the liability in favour of the complainant. Further under scheme of the Act, the onus is upon the accused to rebut the presumption in favour of the complainant by raising a probable defence. 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 C.C.NO.39385/2022 17 complainant in this case.
26. Applying the above said principles to the present case and before considering the point whether the accused succeeded to rebut the presumptions and to establish his defence to the extent of probabilities, it is just and necessary to accumulate undisputed facts in this case.
27. It is not in dispute that bounced cheque belongs to the bank account of the accused. It is also not in dispute that signature appearing on the bounced cheque is the signature of the accused. It is also not in dispute that the cheque presented by the complainant came to be dishonored by the banker of the accused for the reason stated in the dishonor memo. To consider whether the accused succeeded to rebut the presumption and established the defence to the extent of probabilities, the accused has not produced any documents in this regard. It was also contended by the accused that he had given two blank cheques to the complainant for the purpose of security and one of the blank cheque was misused by the complainant. But the accused has failed to produce any believable evidence before this court.
28. In the defence there is no ill-will between the complainant and the accused. Hence, misuse of cheque and filing a false case is not possible. The accused admittedly having knowledge of business. It is C.C.NO.39385/2022 18 implies, he is conversant with financial transaction. If the complainant misused the said cheque and had not return the same, inspite of collecting cheques leaves from him, as a prudent man, the accused should have inquired with the complainant and demanded to return those cheques. No ordinary prudent man would keep quite in such circumstances, without taking any steps. The conduct of the accused is very unusual, because he did not take any legal action against the complainant, even after filing of the complaint based on Ex.P.1. Further he could have issued a notice to his banker to stop payment or legal notice to the complainant or he could have given complaint to the police station immediately. No such steps were taken by the accused. He simply makes a bald allegation of misuse of the cheque against the complainant. It appears, just to escape from his legal liability, he has taken such contentions without any valid basis.
29. Moreover, the complainant have got issued a legal notice to the accused by registered through its counsel calling upon the accused to make repayment of amount to the complainant. Before a person is held to be guilty of an offence punishable under section 138 of N.I.Act, the complainant have to proved the compliance of the requirement under section 138 of N.I.Act. It is not in dispute that Ex.P.1 being his cheque drawn on account of the accused. In view of the above C.C.NO.39385/2022 19 discussions, it is also held to be proved that it was drawn for discharge of legally enforceable debt/liability. From the evidence of P.W.1 and also cheque return memo-Ex.P.2 it is established that the cheque was dishonored for the reasons "funds insufficient''. A legal notice being issued as per Ex.P.3 within one month from the date of dishonour of the cheque is also not in dispute. In the case on hand the accused has not seriously disputed regarding notice sent by the complainant on his address. But, the accused failed to reply to the notice, immediately after he received the demand notice. Thereby, he could have asserted him defence at an earliest available opportunity. In the case on hand the notice is sent to the accused at his address. When the accused has not seriously disputed, the notice sent to the correct address is sufficient compliance under section 138 of N.I.Act. Therefore, there is sufficient proof of due service of the legal notice.
30. It is not the contention of the accused that thereafter he has paid the cheque amount within stipulated time of 15 days on receiving the notice. Therefore, in the case on hand on perusal of the evidence placed on record, all the essential ingredients under section 138 N.I.Act, have been complied with. As the accused has not paid the cheque amount within stipulated period and failed to give reply to the notice, C.C.NO.39385/2022 20 as such the accused have committed an offence punishable under section 138 of Negotiable Instruments Act. The present complaint is filed within the period of one month after the accused failed to repay the cheque amount. Even the accused did not whisper anything about the defence while his plea was recorded under section 251 of Cr.P.C. In view of judgment of Hon'ble Supreme Court in Indian Bank Association V/s Union of India and others, (2010 (5) SCC 590), it is clear that while recording the plea under section 251 of Cr.P.C., it becomes the duty of the accused to state whether he has any defence to make or he pleads guilty. Thus, unlike under section 240 of Cr.P.C, the accused has no option under section 251 of Cr.P.C, just to deny the allegations made against him. If he is not willing to plead guilty, he must explain what are the defences he want to take. As such it has to be considered, whatever defence raised by the accused during the trial are all after thought, just to get ride of statutory burden cast on him.
31. In addition to this in the case of T.P.Murugan (Dead) through legal representatives V/s Bojan, reported in 2018(8) SCC 469, the Hon'ble Apex Court held that once the cheque has been signed and issued in favour of the holder of the cheque, there is statutory presumption that the cheque is issued in respect of legally enforceable debt or liability: rebuttal of such C.C.NO.39385/2022 21 presumption must be by adducing credible evidence. Mere raising a doubt without cogent evidence with respect to the circumstances, presumption under section 139 of N.I.Act cannot be discharged. The principle of law laid down in the above decisions are applicable to the facts of this case. Except some bald contentions, the accused has not been able to make out a probable case on his behalf.
32. The learned counsel for the accused argued except signature other writings on Ex.P.1-cheque is not in his handwriting, which was filled up by the complainant and it amounts to material alterations, so, the complaint is liable to be dismissed. As narrated above, when the accused admits his signature, he cannot take up a defence that other contents of cheque was filled up by the complainant and it amounts to material alteration. In this respect, ruling reported in 2019 SCC On-line (SC) 138), between Bir Singh V/s. Mukesh Kumar, the Hon'ble Apex Court held as under:
"37.A meaningful reading of the provisions of the Negotiable Instruments Act including, in particular, Sections 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any C.C.NO.39385/2022 22 person other than the drawer, if the cheque is duly signed by the drawer, if cheque is otherwise valid, the penal provision of Section 138 would be attracted.
38. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still the on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence.
40. Even a blank cheque leaf, voluntarily signed and handed over by the accused which is towards some payment. Would attract presumption U/sec.139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt."
33. The principles emerging from the above referred decision make it clear that, it is not mandatory and no law prescribes that the contents of cheque should be written by the signatory to the cheque. A cheque can be written by anybody and if the account holder of the cheque signs it, the presumption under section 139 of N.I Act arises. The principle of law laiddown in above decision is aptly applicable to the facts of this case. In view of section 20 of N.I.Act, cheque being an inchoate instrument, if the drawer C.C.NO.39385/2022 23 signs and delivers to the drawee, thereby he gives authority to the drawee thereof to make or complete the instrument.
34. As per the version of the accused is that the accused has nowhere denied transaction. The accused himself has admitted that he is the holder of alleged cheque. It is sufficient hold that the accused has issued the cheque-Ex.P.1 and even after he has not repaid the cheque amount the getting of receipt of notice. However, in any manner as the complainant have complied all the terms of ingredients of the provisions of 138 of N.I.Act. In case of dishonor of cheque, once the execution of cheque is admitted by the accused, then it for him to first rebut presumption arising out of section 139 of N.I.Act. Accordingly, PW.1 has established the case of the complainant, the accused had issued the cheque-Ex.P.1 in order to repay the legally recoverable amount. Therefore, the accused has failed to probables the defence taken by him that the cheque-Ex.P.1 was a blank cheque given to the complainant at the time of receiving the chit amount. Therefore, the accused has failed to rebut the presumption under section 139 of N.I.Act. In the said circumstances, the complainant is not at all required to produce any material as to the financial transaction between the complainant and the accused, since the initial presumption is still available, when there is no C.C.NO.39385/2022 24 rebuttal evidence.
35. PW.1 in his evidence has specifically deposed that the accused is a subscriber in the chit group No.G2A-115, ticket No.03 for a value of Rs.3,00,000/- per month of Rs.15,000/- the period of 20 months. The accused had participated in the chit auction and he bid the chit amount of Rs.75,000/-, thereafter he had received prize money of Rs.2,28,000/-. Thereafter, he also had executed surety form, on demand promissory note, etc., in favour of the complainant company. After taking the prized amount the accused has failed to repay the chit subscription and interest. Thereafter the complainant got issued a demand notice. Thereafter the accused to pay aforesaid chits amount had issued the cheque in question in favour of the complainant. So also it is not in disputed that the complainant and the accused are known to each other, some point of period, the complainant is a private limited chits company and the accused was a subscriber, this is not disputed by the accused. The accused has failed to rebut the presumption under section 139 of N.I.Act, non furnishing of details of financial transaction no consequences to disbelieve the case of the complainant. The accused has failed to probables his defence. With these reasons, I answer point No.1 and 2 in the Affirmative.
36.POINT NO.3 AND 4: In order to avoid C.C.NO.39385/2022 25 repetition of facts, these points are taken together for common discussion. Before a person is held to have committed an offence punishable under section 138 of N.I.Act, the complainant have to prove all the requirements of section 138 of N.I.Act. Ex.P.1 being his cheque drawn on the account of the accused is not in dispute. The said cheque having been dishonored for the reasons "funds insufficient", when it was presented by the complainant before the bank for encashment is also not seriously disputed by the accused. The accused has not taken up any contention that thereafter he had paid the cheque amount within stipulated time of 15 days, after issuance of the notice. As such in the present case from perusal of documents, the essential requirements of section 138 of N.I.Act, have been complied with. In this case if the accused had issued two blank cheques in favour of the complainant at the time of receiving the chit amount and why he has not produced any documents. After service of notice the accused has not paid the said amount and failed to give reply to the said notice. Hence, the present complaint came to be filed before the court on 20.12.2022 within the period of one month from the date of cause of action. While discussing the point No.1 and 2, this court has already observed that the complainant's have proved that the cheque-Ex.P.1 was issued for discharge of legally enforceable liability/debt and in view of the mandatory requirements C.C.NO.39385/2022 26 under section 138 of N.I.Act, being complied with. The accused is found to have committed an offence punishable under section 138 of N.I.Act. With these reasons, I answer point No.3 and 4 in the Affirmative.
37. POINT NO.5: The accused is held to have committed an offence punishable under section 138 of N.I.Act. The complainant have proved its case. The accused has failed to prove his rebuttal for the reasons mentioned above and in view of the mandatory requirements of section 138 of N.I.Act, being complied with. The accused is found to have committed an offence punishable under section 138 of N.I.Act. Since, the said offence is an economic crime, the accused is not entitled for the beneficial provisions of probation of offenders Act. In view of the above discussions and the findings on point No.1 to 4, I proceed to pass the following;
ORDER Acting under section 255(2) of Cr.P.C. the accused is convicted for an offence punishable under section 138 of N.I.Act.
The bail bond executed by the accused is hereby stands cancelled.
The accused is sentence to pay fine of Rs.1,30,000/- (Rupees one lakh thirty thousand only) to the complainant.
It is further ordered that out of the said C.C.NO.39385/2022 27 fine amount an amount of Rs.1,22,000/- (Rupees one lakh twenty two thousand only) shall be paid to the complainant as compensation as per Section 357(1)(b) of Cr.P.C., and remaining amount of Rs.8,000/- (Rupees eight thousand only) shall be remitted to the State.
In default of the payment of fine amount, the accused shall undergo simple imprisonment of 06 months.
(Dictated to the stenographer directly on computer typed by her, corrected by me and then judgment pronounced in the open court on 25 th day of October 2024) Digitally signed by SOUBHAGYA SOUBHAGYA B BHUSHER B BHUSHER Date:
2024.10.26 12:11:04 +0530 (Soubhagya.B.Bhusher) XXVIII Addl. Chief Judicial Magistrate, Bengaluru City.
ANNEXURE List of witness examined on behalf of the complainant:
PW.1 : Sri.Varadaraju.
List of documents marked on behalf of the complainant:
Ex.P.1 : Cheque
Ex.P.1(a) : Signature of the accused.
Ex.P.2 : Bank endorsement.
Ex.P.3 : Office copy of the legal notice.
Ex.P.4 : Postal receipt.
Ex.P.5 : Returned postal cover.
Ex.P.5(a) : Returned legal notice.
Ex.P.6 : Minutes of meeting.
C.C.NO.39385/2022
28
Ex.P.7 : Chit payment voucher.
Ex.P.8 : Demand promissory note.
Ex.P.9 : Demand notice.
Ex.P.10 : Postal receipt
Ex.P.11 : Complaint.
List of witnesses examined on behalf of the accused:
DW.1 : N.Govindaraju.
List of documents marked on behalf of the accused:
Ex.D.1 : Pass book. Digitally signed by SOUBHAGYA SOUBHAGYA B BHUSHER B BHUSHER Date: 2024.10.26 12:11:12 +0530 XXVIII Addl. Chief Judicial Magistrate, Bengaluru City. C.C.NO.39385/2022 29 25.10.2024 (Judgment pronounced in the Open Court Vide Separate Sheet) :ORDER: Acting under section 255(2) of
Cr.P.C. the accused is convicted for an offence punishable under section 138 of N.I.Act.
The bail bond executed by the accused is hereby stands cancelled.
The accused is sentence to pay fine of Rs.1,30,000/- (Rupees one lakh thirty thousand only) to the complainant.
It is further ordered that out of the said fine amount an amount of Rs.1,22,000/- (Rupees one lakh twenty two thousand only) shall be paid to the complainant as compensation as per Section 357(1)
(b) of Cr.P.C., and remaining amount of Rs.8,000/- (Rupees eight thousand only) shall be remitted to the State.
In default of the payment of fine amount, the accused shall undergo simple imprisonment of 06 months.
XXVIII Addl. Chief Judicial Magistrate, Bengaluru City.