Bangalore District Court
Sri.Devaraj vs S/O Sri Doreswamy on 9 March, 2023
1 Crl.A.No.1151/2021
KABC010290522021
IN THE COURT OF THE LIX ADDL.CITY CIVIL &
SESSIONS JUDGE (CCH-60) AT BENGALURU
Dated this the 9 th day of March, 2023
-: P R E S E N T :-
Sri.SADANANDA NAGAPPA NAIK B.A.L, L.L.B.,
LIX ADDL.CITY CIVIL & SESSIONS JUDGE,
CCH-60, BENGALURU CITY.
CRIMINAL APPEAL No.1151/2021
APPELLANT/ : Sri.Devaraj
ACCUSED S/o Sri Doreswamy,
Aged about 52 years,
R/at.No.4, Sri.Manjunatha
Nilaya, Huttanahalli Main
Road, Vidyanagar Cross,
Bettahalasur Post, Bangalore
North-562157
(By Sri M Satish Kumar,
Advocate)
V/s.
RESPONDENT/ : Sri. C. Anand Raj
COMPLAINANT S/o Sri. Chinnakolandai,
Aged about 65 years,
2 Crl.A.No.1151/2021
Presently residing at No.2,
3rd Floor, Neharunagar,
Behind old Kino Theatre,
Sheshadripuram,
Bangalore-560 020
Permanently R/at.
Hatti Village,
Hatti Main Road,
Basavanagar,
Kumara Complex,
Raichur-584115
(By Sri KBN, Advocate)
J UD GM E N T
Appellant has filed this appeal U/s.374(3) of Cr.P.C., being aggrieved by the judgment of conviction and order of sentence passed in C.C.No.2247/2019 dated 30.11.2021 on the file of IV Addl., Small Cause Judge & ACMM, Court of Small Causes, Bengaluru (hereinafter referred as impugned judgment and order).
2. Parties to this appeal shall be referred as per their ranking before the trial court for the purpose of convenience and for better appreciation of their contentions.
3. In the memorandum of appeal, the accused has contended that the judgment passed by the learned 3 Crl.A.No.1151/2021 Magistrate is illegal, capricious contrary to law, facts, probabilities and circumstances, trial court has not considered the evidence of accused, has not considered the admissions of the complainant, committed error in appreciating the evidence of the complainant, erred in considering the several weakness in the testimony of PW-1 and failed to consider the evidence of complainant suffers from factual errors. The accused has not received any legal notice as required under Sec.138(b) of N.I.Act. Impugned judgment is without appreciating the facts and circumstance of the case. Trial court failed to consider that the complainant has misused the cheque and concocted the RPAD covers though the notice is not served upon the accused. The accused is not liable to pay any amount to the complainant. For the aforesaid reasons, the appellant has prayed to set aside the impugned judgment and order of conviction.
4. Along with memorandum of appeal, appellant produced certified copy of impugned judgment and order of conviction passed by the trial Court in C.C.No.2247/2019.
5. Respondent appeared through his counsel. Heard arguments. T.C.R. were called for reference in this appeal.
4 Crl.A.No.1151/20216. Now, following are the points arising for determination:
1. Whether in the light of evidence and material brought before the court, trial Court is justified in convicting accused/appellant for the offence punishable U/s.138 of N.I. Act and sentencing accused for the said offence?
2. Whether interference of this Court is necessitated?
3. What order?
7. It is answered for the aforesaid points as under:-
Point No.1: In the Negative Point No.2: In the Affirmative Point No.3: As per final order below, for the following:-
R E A S ON S
8. Points No.1 & 2:- These points are taken together to avoid repeated discussions.
5 Crl.A.No.1151/20219. Brief facts of the complaint is as follows:
According to the Complainant, the accused approached him and availed a credit facility to the tune of Rs. 9,00,000/- in the year 2016. He assured that he will return the amount within eighteen months. Subsequently, for repayment of the said amount along with interest of Rs. 12,51,000/- the accused issued two cheques i.e., cheque bearing No. 601964 for a sum of 9,00,000/- dated 30.12.2018 and another cheque bearing No.601965 for Rs.3,51,000/- dated 30.12.2018 drawn on State Bank of India, Bengaluru. When the cheques were presented for collection, the cheques were dishonored by the said Bank on 05.02.2019 on the ground that the "funds insufficient Thereafter, the complainant issued a statutory notice dated 27.02.2019 under section 138 of the Negotiable Instrument Act, to the accused. Though accused had knowledge about the issuance of notice, the accused has not given reply to the said statutory notice. Since the said notice was not complied with, the complainant filed the complaint against the accused/appellant U/s.200 of Cr.P.C. for the offence punishable U/s.138 of N.I.Act.
10. Perused entire order sheets, complaint filed U/s.200 of Cr.P.C., for the offence punishable U/s.138 of N.I.Act, examination-in-chief affidavit of the complainant, plea of accusation, contents of exhibited documents 6 Crl.A.No.1151/2021 Exs.P.1 to P.13. There is no procedural defect of any nature while conducting trial relating to private complaint registered for the offence punishable U/s.138 of N.I.Act.
11. So far as appreciation of evidence is concerned, Complainant is examined as PW.1. PW.1 has reiterated averments of complaint in his examination-in-chief Ex.P1&2 are the Cheques, Ex.P.3 & 4 are the Banker's endorsements, Ex.P.5 is the Office Copy of Legal Notice, Ex.P.6 is the Postal receipt, Ex.P7 is the RPAD Cover, Ex.P.8 is the Loan Agreement dated 05.07.2018, Ex.P.9 is the Bank Pass Book, Ex.P.10 is the Bank Statement, Ex.P11 is the Notice dated 06.02.2019, Ex.P12 is the Postal Receipt, Ex.P13 is the Postal Cover. PW.1 has deposed that for the discharge of debt, accused had issued two cheques and upon presentation, the same came to be dishonored and accused has failed to pay the amount even after receipt of the notice. PW.1 has denied the suggestion that the Accused had given the two cheque as security and the same has been misused.
12. Accused appeared before the Court and he is enlarged on bail. He has specifically denied the liability to the complainant. It is contented by the accused/appellant he had issued the impugned cheque for security purpose. That, Sec.138 statutory notice is not served upon him.
13. It is settled principle of law as held by House of Lords in Vickers Sons and Maxim Ltd., Vs. Evans (1910) 7 Crl.A.No.1151/2021 AC 444 as quoted with approval by the Hon'ble Apex Court in Jamma Masjid, Mercara Vs Kodimaniandra Deviah and Others AIR 1962 SC 847 and reiterated in Shiv Shakti Co- operative Housing Society vs Swaraj Developers, AIR 2003 SC 2434 and in catena of decisions that the court cannot read anything into a statutory provision which is plain and unambiguous.
14. On bare perusal of the object of the Negotiable Instruments Act, it shows that the main object of the Chapter introducing dishonour of cheque on account of insufficiency of funds as penal offence in the Act is to enhance the acceptability of cheque. In order to attract the ingredients of Sec.138 of NI Act, the complainant needs to prove that the cheque drawn by a drawer of the cheque on an account maintained by him issued to the payee in discharge of any debt or other liability, cheque is presented to Bank within three months of the date of cheque and returned by the drawer bank as unpaid, complainant has made a demand for the payment of the said amount of money by giving a notice in writing within 30 days of receipt of information of dishonour by the Bank, and the drawer of such cheque has not made the payment of the said amount of money to the payee within fifteen days of the receipt of the said notice, then such person shall be deemed to have committed an offence and shall, without 8 Crl.A.No.1151/2021 prejudice to any other provisions of the Act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both.
15. It is well settled principle of criminal jurisprudence that a criminal trial proceeds on the presumption of innocence of the accused. An accused is presumed to be innocent unless proved guilty. It is the complainant/ prosecution to prove the guilt of the accused beyond reasonable doubt. However, in respect of offence under Section 138 of the Act, although there is a reverse onus clause contained in Sections 118 & 139 of the Act, the initial burden is on the complainant.
16. It is also a settled proposition of law that the standard of proof which is required from the accused to rebut the statutory presumption under Section 118 read with Section 139 of the Act is preponderance of probabilities. The accused is not required to prove his case beyond reasonable doubt. This onus on the accused can be discharged from the materials available on record and from the circumstantial evidences or even by admissions in the cross-examination of complainant and his witnesses.
17. In K. Bhaskaran Vs. Sankaran Vaidhyan Balan reported in AIR 1999 SC 3762, the Apex Court held that 9 Crl.A.No.1151/2021 once the signature in the cheque is admitted to be that of the accused, the presumption envisaged in Section 118 of the N.I. Act can legally be drawn to infer that the cheque was made or drawn for consideration on the date which the cheque bears.
18. In Rangappa Vs. Sri Mohan reported in AIR 2010 SC 1898, a three judges' bench of the Supreme Court held that that once issuance of a cheque and signature thereon are admitted, presumption of a legally enforceable debt in favour of the holder of the cheque arises. It is for the accused to rebut the said presumption, though accused need not adduce his own evidence and can rely upon the material submitted by the complainant. However, mere statement of the accused may not be sufficient to rebut the said presumption. A post-dated cheque is a well recognized mode of payment.
19. In K.S. Ranganatha Vs. Vittal Shetty reported in 2021 SCC OnLine SC 1191, a three judges' bench of the 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 or liability. It is further held that the 10 Crl.A.No.1151/2021 position of law makes it crystal clear that when a cheque is drawn out and is relied upon by the 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 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.
20. M/s. Kalemani Tax Vs. Balan (Crl.A.No.123/2021) (LL 2021 P.75) decided on 10.02.2021, a three judges' bench of the Supreme 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.
21. Hon'ble High Court of Jammu and Kashmir in Engineering Control Vs. Banday Infratech Pvt. Ltd., CRMC No.381/2018 dated 8.7.2022 held, when the statutory notice of demand is sent to the wrong address, the presumption of receipt of notice by the accused does not arise. Thus, the pre-condition of filing a complaint under Section 138 of the NI Act of is not satisfied. No cause of action arose in favour of complainant to file the complaint.
11 Crl.A.No.1151/202122. Hon'ble Supreme Court in M.D.Thomas Vs. P.S. Jaleel, reported in 2009(14) SCC 398, it is held that notice to drawer is sine-qua-non in terms of clause (b) of proviso to Sec.138 of N.I. Act.
23. Hon'ble Supreme Court in Alavi Haji Vs. Palapetty Muhammed and another, 2007 (6) SCC 555, held that, wherein notice which was sent to correct address and returned with endorsement that addresses was abroad, held that any drawer who claims that he did not receive the notice sent by him, can, within 15 days of receipt of the summons from the court in respect of the complaint u/Sec.138 of N.I. Act can make payment within 15 days of receipt of summons comply the same and he cannot escape under statutory presumption of Sec.27 of General Clauses Act and Sec.114 of Evidence Act.
24. Applying the above said principles to the present case and before considering the point whether accused succeeded to rebut presumptions and to establish his defence to the extent of probabilities, it is just and necessary to accumulate undisputed facts in this case.
25. 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 12 Crl.A.No.1151/2021 dispute that, the cheque presented by the complainant came to be dishonoured by the banker of the accused for the reason stated in the dishonour memo.
26. To consider whether accused succeeded to rebut the presumption and established defence to the extent of probabilities, the accused has adduced his evidence as DW.1 and got marked Ex.D.1 to D.4. ExD.1 & 2 are the Notarized copies of Aadhar card and Voter Identity card , Ex.D.3 is the Certificate, Ex.D.4 is the RTC. It is evident from the records that the address of the accused is No.4, Vidyanagar Cross, Bettahalasuru, Bengaluru 562157. However notice has been sent to wrong address i.e., No.5, Milan Jewellers and bankers, Huttanahalli Main Road, Vidyanagar Cross, Bettahalasuru, Bengaluru 562157 as per Ex.P.5 to 7.
27. Section 27 of General Clauses Actgives rise to a presumption that service of notice has been affected when it is sent to the correct address by registered post. Further it is evident from Ex P.11 Ex.P13 that notice has been sent on 6.2.2019 as per Ex.P11 postal receipt. However, the endorsement on returned postal cover is endorsed as postman has made enquiry on 2.2.2019, 4.2.2019, 5.2.2019. It is highly impossible that the notice which was sent to accused on 6.2.2019,the postmen will make an attempt to deliver the post prior to dispatch of the notice 13 Crl.A.No.1151/2021 itself on 2.2.2019, 4.2.2019 and 5.2.2019. Therefore, Ex.P.11 to P.13 cannot be considered as genuine documents and it is made only for the purpose of the case.
28. Further, though trial court has observed in para 3 of Judgment that notice has been sent and acknowledged by the accused. No such acknowledgment are found in the record or forthcoming on list of exhibits. The decision in Alavi Haji Vs. Palapetty Muhammed (supra) is applicable only when the notice is sent to the correct address. In the present case, as the notice has been sent to wrong address, the same is not duly served upon the accused. In fact, the cause of action for filing the complaint will arise only after issuance of notice and nonpayment of amount within 15 days of the notice. Sending notice is not an empty formalities. The same is mandatory under the statute. When the notice itself is not served or atleast not addressed to proper address, the accused cannot be held guilty for the offence. Therefore, the trial Court has wrongly held that the accused has not rebutted the presumption arising under section 139 of N.I.Act.
29. This Court has compared reasons assigned by the trial court in the impugned judgment of conviction as discussed above with the allegations made in the memorandum of appeal. There are grounds made out in 14 Crl.A.No.1151/2021 the memorandum of appeal to interfere with the Impugned judgment of conviction. The trial Court has wrongly passed the judgment and order of conviction by holding that notice has been duly served when the notice is sent to wrong address than that of found in Ex.D.1 and D.2. There is a merit in the appeal. Order under appeal is not sustainable in law. Hence, interference of this court is necessary. Accordingly, point No.1 is answered in the 'Negative' and point No.2 is answered in the 'Affirmative'.
30. Point No.3: In view of findings on the above points No.1 & 2, this criminal appeal is of merits and same is liable to be set aside Hence, following order is made:
O R DE R Invoking provisions of Section 386 of Cr.P.C., this Criminal Appeal filed U/s. 374(3) is Allowed.
Consequently, impugned judgment of conviction and order of sentence in C.C.No.2247/2019 dated 30.11.2021 on the file of Court of XXV A.C.M.M, Bengaluru, is hereby set aside.
Appellant/accused is hereby acquitted for the offence punishable under section 138 of NIAct.
15 Crl.A.No.1151/2021Office is hereby directed to send back T.C.R. along with certified copy of Judgment to the trial court, forthwith.
(Dictated to the Judgment Writer directly on computer, script typed by her and corrected, signed and then pronounced by me in the open court on this 9 th day of March, 2023) (Sadananda Nagappa Naik) LIX ADDL.CITY CIVIL & SESSIONS JUDGE, CCH-60, BENGALURU CITY.