Bangalore District Court
M/S Fairdeal Consumer Durables Pvt. Ltd vs Smt. Snehalatha on 7 April, 2025
C.C.NO.25147/2018
0
KABC030679742018
Presented on : 14-09-2018
Registered on : 14-09-2018
Decided on : 07-04-2025
Duration : 6 years, 6 months, 23 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 07th DAY OF APRIL-2025
C.C.NO.25147/2018
Complainant: M/s.Fairdeal Consumer Durables Pvt.,Ltd.,
Registered O/at No.60, 3rd Cross,
Lalbagh Road, Bangalore,
Also Branch O/at: Nallakunta,
Hyderbad & Suryaraopet, Vijayawad.
R/by its Director, Sri.Devidasan.
(By Sri.T.Mohandas Rao.,Adv.,)
V/s
Accused: Smt.Snehalatha W/o Sri.Venu Madhav,
Proprietrix, M/s.Venkata Vara Siddhi
Corporation, Plot No.45, Sai Mansion,
1st floor, Asbestos staff colony,
Karkhana, Secundrabad, Telangana-500026.
Also at: Flat No.207, 2nd Floor,
Block No.5, D.V.Township,
Old Safilguda, Near Santoshima Temple,
Secundrabad, Telangana-500056. [[
(By Sri.Hemanth Kumar.G.M.,Adv,.)
C.C.NO.25147/2018
1
:JUDGMENT:
This case arises out of the complaint filed by the complainant against the accused under section 200 of Cr.P.C,. for an offence punishable under section 138 of Negotiable Instruments Act.
2. The case of the complainant's in brief is as under:
It is the case of the complainant is that the complainant is a private limited company and carrying business as distributors for Micromax mobiles and other home appliances represented by its director, who is incharge of the company's affairs and looking after the day today affairs of the company. Further stated that the accused is carrying on business as a dealer for Micromax mobile and have been purchasing mobile smart phones from the complainant from time to time on credit basis. Further the books of account maintained by the complainant in the normal course of business for the period from September 2013, shows that the accused is due of Rs.1,98,70,918/-. Further the accused towards part payment of the dues, had issued the cheque No.247309 dated:12.12.2016 for Rs.1,50,00,000/- drawn on Andhra Bank, Nagole Branch, Hyderabad. As per the request of the accused the complainant had presented the said cheque for encashment through its banker State Bank of India, SME Branch, Jayanagara, Bangalore-78. But on 13.12.2016 the said cheque was dishonored as C.C.NO.25147/2018 2 'Funds Insufficient'. Thereafter, on 26.12.2016 the complainant got issued a legal notice to the accused through its counsel calling upon her to pay the cheque amount within 15 days from the date of receipt of the said notice. The said notice was duly served to the accused on 30.12.2016 and on 11.01.2017 she sent an untenable reply notice through her counsel. But she failed to repay 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 18.02.2017 after expiry of the stipulated period.
3. The learned counsel for the complainant has filed an application under section 142(b) of N.I.Act seeking condone the delay of 04 days in filing the complaint. After hearing on the application, my learned predecessor has allowed the application and condoned the delay of 04 days for filing the present complaint.
4. After the complaint was filed, the cognizance of the offence cited therein was taken and it was registered as P.C.R.No.4701/2017. Sworn statement of the complainant was recorded. Since there were sufficient materials to proceed against the accused, an order was passed on 10.09.2018 to register the case in Register No.III.
C.C.NO.25147/2018 3
5. Thereafter, summons was issued to the accused and she has appeared before the court through her counsel and secured bail. She 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. She has pleaded not guilty and make a defence.
6. The complainant in support of its case, have examined its Director as PW.1 and got marked 10 documents at Ex.P.1 to 10 and the complainant have examined the Branch Manager of State Bank of India, SME Jayanagar branch, Bangalore as PW.2 and got marked 02 documents at Ex.P.15 and 16 and closed its side. During the cross examination of DW.1 04 documents were marked at Ex.P.11 to 14.
7. After closer of the evidence of the complainant, the statement of the accused under section 313 of Cr.P.C., was recorded. She has denied the incriminating evidence appearing against her. In her defence the accused examined herself as DW.1 and no documents were marked on her behalf.
8. During the course of cross examination of DW.1 letter of sanction and e-mail marked at Ex.C.1 and 2.
9. The handwriting expert, Truth Lab, Bangalore is examined through the advocate court commissioner as CW.1 and Ex.C.1 and 2 were marked.
C.C.NO.25147/2018 4
10. I have heard the arguments on both the sides and perused the written arguments submitted by the learned counsels for the complainant as well as accused and also perused the material placed on record.
11. 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.2, towards the discharge of the legally enforceable debt/liability.?
3.Whether the complainant further proves that cheque-Ex.P.2 was dishonored for the reason "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?
12. 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:
C.C.NO.25147/2018 5 :REASONS:
13. POINT NO.1 AND 2: These 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 both points together for common discussion. It is the case of the complainant is that the complainant is carrying business as distributors for Micromax mobiles and other home appliances. Further the accused is carrying on business as a dealer for Micromax mobile and have been purchasing mobile smart phones from the complainant from time to time on credit basis. Further the books of account maintained by the complainant in the normal course of business for the period from September 2013, shows that the accused is due of Rs.1,98,70,918/-. Further the accused towards part payment of the dues had issued the cheque in question in favour of the complainant. Further on request of the accused the complainant had presented the said cheque for encashment 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 her to pay the cheque amount. The said notice was duly served to the accused and she sent an untenable reply notice through her counsel. But she has failed to repay the cheque amount. As such, the C.C.NO.25147/2018 6 accused have committed an offence punishable under section 138 of N.I.Act. Hence, the present complaint came to be filed before this court after expiry of stipulated period with the permission of the court.
14. In support of the case, the complainant have examined its Director as P.W.1 and 10 documents were marked at Ex.P.1 to 10. In the chief examination P.W.1 has repeated the contents taken by the complainant in the complaint. The complainant's have also examined the Branch Manager, SBI SME Jayanagar branch as PW.2 and 02 documents were marked at Ex.P.15 and
16. In the chief examination P.W.2 has deposed regarding bank endorsement. Ex.P.1 is the resolution/ Authorization letter dated: 24.12.2014. Ex.P.2 is the cheque in question issued by the accused in favour of the complainant dated:12.12.2016 for Rs.1,50,00,000/-. Ex.P.2(a) is the signature of the accused. Ex.P.3 is the bank memo dated:13.12.2016 informing the dishonor of the cheque as "Funds Insufficient". Ex.P.4 is the office copy of the legal notice dated: 26.12.2016. Ex.P.4(a) and 4(b) are the postal receipts. Ex.P.5 is the postal acknowledgment. Ex.P.6 is the reply notice dated:
11.01.2017. Ex.P.7 are the 49 tax invoices. Ex.P.8 and 9 are the computerized copies of account ledgers from 01.04.2013 to 02.01.2018 and from 01.04.2013 to 30.11.2017. Ex.P.10 is the complaint. Ex.P.11 is the cheque. Ex.P.12 is the account opening form. Ex.P.13 C.C.NO.25147/2018 7 is the letter of sanction. Ex.P.14 is the e-mail. Ex.P.15 is the copy of register. Ex.P.16 is the bank statement.
15. In order to prove her defence, the accused is examined herself as DW.1 and no documents were marked on her behalf. In her evidence she has deposed that she is a proprietor of Venkatavarasidhi Corporation.
Further her husband is the authorized signatory of Venkatavarsidhi Corporation. In between 2014-16 Venkatavarasidhi Corporation transacted with the complainant. In this connection, she has not given any cheque to the complainant. Further deposed that since she had changed the bank account, and she had given the complainant company bank account details by giving a blank cheque without signing. Further deposed that subsequently, the complainant company had issued a notice to her and she had given a reply. In respect of transactions with the complainant company, she had ledger statement. Further deposed that in respect of transaction she has not having any personal knowledge and her husband is having personal knowledge. Further deposed that the complainant have filed a false case against her. Therefore, she prays to dismiss the complaint and acquit her.
16. The handwriting expert by name Shankarappa Mural is examined through advocate court commissioner as CW.1. In his evidence he deposed regarding the C.C.NO.25147/2018 8 examination of admitted signatures and disputed signature and also report submitted by him. He also marked two documents at Ex.C.1 and 2. Ex.C.1 is the covering letter dated: 03.01.2024 and Ex.C.2 is the report submitted by him along with covering letter dated:
26.12.2023.
17. 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 complainant is carrying business as distributors for Micromax mobiles and other home appliances. Further argued that the accused is carrying on business as a dealer for Micromax mobile and have been purchasing mobile smart phones from the complainant from time to time on credit basis and the books of account maintained by the complainant in the normal course on business for the period from September 2013 it shows that the accused is due of Rs.1,98,70,918/-. Further argued that after repeated request made by the complainant, the accused towards part payment of the dues, had issued cheque-EX.P.2 in favour of the complainant. Further argued that on the request of the accused the complainant had presented the said cheque for encashment through its banker. But the said C.C.NO.25147/2018 9 cheque was dishonored as 'Funds Insufficient'. He further argued that the accused has not denied Ex.P.2 being her cheque drawn on her account. When it 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. Further argued that the accused has failed to produce any believable evidence that she had issued two blank unsigned cheques in favour of the complainant for providing account details of the accused and also why she has not returned back the same is not clear. He further argued that the accused has failed to produce any documentary evidence regarding she had issued two blank unsigned cheques for providing account details of the accused. Further argued that under section 139 of N.I.Act, there is a presumption that the cheque have been issued for discharge of legally enforceable debt/liability. In the present case, the accused has not disputed Ex.P.2 being her cheque drawn on her account. The said presumption is available to the complainant.
18. The learned counsel for the complainant has filed written argument. In his written argument reiterated the facts of the case. It is further submits that C.C.NO.25147/2018 10 the defence of the accused is that as per the reply notice dated: 11.01.2017 at Ex.P.6 the accused contends that the cheque was not issued for discharge of any liability and that the cheque was given only to provide the account details of the accused lying with Andhra Bank since the accused newly opened the account and that the cheque was issued without signing. Further it is stated in the reply, "it is true that the business transactions happened between my client and you client from 2013 onward and there is an outstanding amount in your client account with my client, but the amount which was written in you notice is not correct." Further submits that the liability of the accused has been proved beyond doubt. The signature on the cheque is of the accused, since the report of the handwriting expert that the signature on the cheque does not tally with the admitted signature, is not corroborated by any other evidence. On the contrary, the other evidence, such as the second cheque for Rs.50,00,000/- and the cross examination of the accused DW.1 and CW.1 hand writing expert clearly prove that the signature on the cheque is that of the accused. The credibility of the accused/DW.1 has been impeached in her cross. Further, all the requirements of section 138 of N.I.Act have been complied with. Hence, accused deserved to be convicted under section 138 of the N.I.Act. The complainant has produced the C.C.NO.25147/2018 11 dishonored cheque No.247309 dated: 12.12.2016 issued by the accused at Ex.P.1, 49 tax invoices at Ex.P.7, Ledger extracts at Ex.P.8 & 9 and has examined its director and authorized representative as PW.1 and the complainant's bank manager, SBI as PW.2. In addition the complainant also produced the cheque No.247310 dated: 12.12.2016 for Rs.50,00,000/- at Ex.P.11 and e-mails sent by the accused to the complainant at Ex.P.13 & 14 showing the sanction letter from bank.
19. It is further submits that the contention of the accused that the dishonored cheque was not given for any liability stood disproved when the second cheque for Rs.50,00,000/- was produced to show that two cheques were given for the entire balance liability of Rs.1.98 crores. Also the contention that the cheque was given only for providing account details to the complainant as the accused had opened a new bank account at Andhra Bank also stood disproved, as untenable. Infact, as the purchaser, it is the accused who requires the bank account details of the complainant, as the accused is liable to pay the complainant and not the other way round as contended by the accused. Further, all the contentions of the accused stood disproved when the second cheque for the amount of Rs.50,00,000/- was produced and C.C.NO.25147/2018 12 marked as Ex.P.11, since the two consecutive cheques clearly show that they were given for the discharge of the liability by the accused. In the context of the complainant and the defence, it is important to consider the evidence of the accused. In his written argument he has reiterated the chief examination of DW.1. From the chief examination of DW.1 it is very clear that the accused accepts the transactions with the complainant and also says that she has ledger accounts with respect to the transactions, but does not produced any document in that regard. In the further chief examination, DW.1 states, the her husband transacted with the complainant organization. With respect to the said transactions, she do not have personal knowledge. She has not signed and given the questioned cheque to the complainant, the complainant has filed false complaint against her". It is further clear from the chief examination of the accused/DW.1 that she does not explain as to how the questioned cheque got into the hands of the complainant. As such, it is very clear that the questioned cheque was given to the complainant by the accused towards discharge of her liability.
20. It is further submits that the accused-DW.1 had deposed falsely in her evidence to the extent that her credibility got impeached under section 155 of the Indian Evidence Act. Further though she admitted that she is a B.Com graduate, very cleverly and cunningly, C.C.NO.25147/2018 13 for all the questions, she was replying that it was only her husband who was taking care of all the transactions and as such, she know nothing about the transactions between the accused and the company. As such, when questioned as to whether she had given instructions to the advocate for giving a reply as per Ex.P.6, she replied that she did not give the instructions for issuance of reply notice-Ex.P.6. However, Ex.P.6 reply notice indicates that the reply notice is issued under the instructions of his client Venkatavarsidhi Corporation. Further the accused is a proprietorship concern. On this ground alone, the complaint deserves to be allowed and the accused is convicted. Further submits that the accused lies to the question that she is not aware of the address, door number or the property number and that the office of the accused has been carrying on its activities since 2012. However, she admits that the accused is into mobile trading and that the accused used to purchase mobile handsets from the complainant for retail sale. She states that she is not aware as to whether the accused has traded/purchased mobile handsets to the tune of Rs.20 crores. Further, it is important to note that she has not denied the liability of Rs.2 crores i.e., due and outstanding by the accused to the complainant, but only states that she is not aware. In fact, she states that she is only a signing authority. She also pleads C.C.NO.25147/2018 14 ignorance with respect to 49 invoices raised by the complainant on the accused towards supply of mobile handsets.
21. Further submits that it is also to be noted that in the reply notice at Ex.P.6, no where it has been stated that it is the husband of the accused that is running the business. Further when the balance cheque for Rs.50 lakhs is confronted to the accused, DW.1, since she admits that cheque is from her bank account which is marked as Ex.P.11. When further enquired as to whether the signature at cheque Ex.P.11 is her, she initially stated that she is not aware, later stated that it is not her signature. Further it is very evident that she has been stating that she does not know anything including her own signature which very clearly discredits her credibility as a witness. Further when enquired as to what is the amount that is due to be paid by the accused as per the reply notice at Ex.P.6, she says that she is not aware and that she has not examined the account in respect of the transactions between the complainant and the accused. It is further submits that in fact, though she admits her mail id, from which letter of sanction was sent as attachment to the complainant to assure that payments would be made on the release of money from the bank, she did not accept the emails confronted to her and as such, this court realizing the evasive reply, marked the same as C.C.NO.25147/2018 15 Ex.C.3 & 4. It is submits that the accused/DW.1 was feigning ignorance in order to escape the liability and the prosecution by the complainant. Further the husband of the accused who allegedly handled the transactions with the complainant not examined. Though the accused/DW.1 feigned ignorance and stated that it was only her husband who knew everything, she did not get her husband to depose and rebut the evidence of the complainant and hence on this ground alone, the complaint deserves to be allowed and the accused convicted. Further invoices and ledger statement produced by the complainant to prove liability un-rebutted.
22. Further submits that though the accused indicated in her chief examination that she has the ledger statement in respect of the transactions between the complainant and the accused and though she had indicated that she could produce the same in her cross examination, the same was not produced. As such, the complainant after the cross examination of DW.1 filed an application under section 91 seeking for direction to produce VAT registration certificate, VAT returns for the relevant period and the ledger statement in respect of transaction between the complainant and the accused. Very conveniently, the accused filed a memo along with VAT registration certificate in respect of Telangana and C.C.NO.25147/2018 16 Andhra Pradesh and the VAT monthly returns for some period and a ledger statement maintained by the accused. However, on realizing that the ledger statement was completely fabricated for the purpose of case, the complainant filed an application under section 311 to recall DW.1. the same was opposed by the accused vehemently on the ground that DW.1 was not aware of the transactions, on account of which this court rejected the application. However, it is to be appreciated that the burden of proof is actually on the accused to rebut the ledger statement produced by the complainant and if it is the husband who transacted on behalf of the accused with the complainant, the husband of the accused ought to have been examined. As such the liability of the accused is clearly prove by the complainant.
23. It is further submits that liability disputed by the accused on the ground that the ledger statements at Ex.P.8 & 9 are in the name of "Venkateshwara Siddhi Corporation" and not the accused, is untenable. In fact the ledger statement produced by the accused pursuant to the order under section 91, very clearly shows that that alleged ledger makes reference to the accused firm as "Venkateshwarasiddhi Corporation". In fact, the ledger statement produced by the accused pursuant to the order under section 91, very clearly C.C.NO.25147/2018 17 shows that the alleged ledger makes reference to the accused firm as "Venkateshwarasiddh Corporation" as has been referred in the invoice at Ex.P.7 and ledger statements at Ex.P.8 & 9. Such being the case, the contention of the accused that the invoices of the complainant at Ex.P.7 show the name of the accused as "Venkatavarasidhi corporation" does not relate to the accused, is absolutely untenable. Further it is to be noted that the invoices at Ex.P.7 clearly show the sale to the accused and also the VAT registration number in each of the invoices. Even documents obtained from the public domain of the VAT registration would clearly show that the VAT number relates to the accused and hence the transaction with the accused as indicated in the invoices at Ex.P.7 are absolutely genuine and valid. Further submits that a perusal of the ledger statement also indicates that as against the liability of Rs.1.98 crores by the accused, the accused for the first time has come up with a negative statement of Rs.37 lakhs allegedly payable by the complainant to the accused. It is to be noted that the above fabrication of ledger statement goes against the other documents and evidence, such as legal notice-Ex.P.6 and the cross examination of the accused. Since the ledger statement and the invoice of the complainant stand un-rebutted, coupled with the admission under the reply notice at Ex.P.6 and the cross examination of the accused, it is C.C.NO.25147/2018 18 very clear that the accused is liable to pay the dishonored cheque amount and that towards the discharge of liability, the accused had issued the dishonored cheque to the complainant.
24. It is further submits that from a liability of Rs.1.98 crores, the accused manipulates the accounts ledger to show that the complainant is liable to pay Rs.37 lakhs by removing and omitting may major invoices raised by the complainant as against the accused. However the accused was not ready to testify and was not willing to test the veracity of the ledger statement sought to be produced by him since it is clear that the ledger has been manipulated to suit her convenience. Further a comparison of the C-forms issued by the accused to the complainant when compared with the invoices and the ledger statement and the accused monthly VAT returns would clearly bring out the manipulations done by the accused in her ledger statement. Further 49 tax invoices, marked as Ex.P.7, the ledger extract for the period from 01.04.2013 to 02.01.2018, marked as Ex.P.8, and the ledger extract for the period from 01.04.2013 to 30.11.2017, marked as Ex.P.9, clearly establish the transactions between the accused and the complainant, thereby evidencing the accused's liability to pay a sum of Rs.1,98,70,918/-. Further throughout the proceedings of this case, the accused have C.C.NO.25147/2018 19 consistently maintained that only one cheque was issued. However, during the course of arguments, the learned counsel for the accused, in a rather casual manner, stated that "two cheques may have been issued one for the complainant's Vijayawada warehouse and another for Secunderabad." It is pertinent to note that the entire business transactions between the accused and the complainant were conducted exclusively through the complainant's Bangalore office.
25. Further submits that regarding the billing name, it is submits that the accused had initially informed the complainant the billing address and billing commenced under the name "Venkateshwarasiddi Corporation', and due to the computerized billing system, the same name continued to be reflected in subsequent invoices. However, it is pertinent to note that the address mentioned in all invoices is correct, and in the absence of any request from the accused to rectify the firm's name, the practice was continued in good faith. Furthermore, it is significant that the supplies made by the complainant from Vijayawada under the same name and address were duly accepted by the accused, who also issued 'C' forms from Hyderabad. Most importantly, the original seal of 'Sri.Venkatavara Siddhi Corporation' has been affixed C.C.NO.25147/2018 20 on all tax invoices at the time of receiving the supplies, thereby confirming the accused's acknowledgment and acceptance of the transactions. It is further submits that the accused furnished a memo dated: 14.02.2025 with the ledger statement of the accused, it clearly shows the name given to the complainant by the accused in their own ledger statement mentioned as "Venkateshwara Siddi Corporation', which they state is not their name, clearly shows the manipulation and fabrication by the accused. Further in their reply notice, the accused has explicitly admitted to maintaining a good business relationship and understanding with the complainant. The accused has further acknowledged that business transactions have been ongoing between the parties since 2013 and that an outstanding amount remains payable to the complainant. This unequivocal admission, while attempting to evade liability, clearly exposes the malafide intention and dishonest conduct of the accused. Further in his written argument reiterated order on application dated: 27.09.2019 filed by the accused under section 45 of the Indian Evidence Act.
26. Further submits that admissions of the handwriting expert in the cross examination. It is submits that the disputed cheque was sent to a private laboratory for signature verification. The handwriting expert, Shankarappa Mural (CW.1) has opined that the C.C.NO.25147/2018 21 standard signature and the questioned signature were not executed by the same person. Further submits that CW.1 has admitted that the pen pressure and writing speed are crucial factors in the comparison and assessment of signatures. However, he has further admitted that his report does not include any analysis of pen pressure or writing speed. CW.1 has not considered pen stops in his report. CW.1 has acknowledged in his report that variations in writing style, signature composition, hand positioning, slant, pressure, and speed-whether increased or reduced- can occur due to deliberate disguise. He has also admitted that these factors influence alignment, relative size, and other characteristics of a signature. However, these consideration have not been addressed in his report. CW.1 has also admitted that the probability of error in handwriting identification is higher compared to fingerprint analysis or other forensic identification methods. It is respectfully submitted that expert opinion in handwriting verification is considered a weak from of evidence, and reliance has been placed on several judicial precedents to support this contention. It has been noted citation of the Hon'ble High Court of Karnataka in (ILR 2006 KAR 234), Para 6: The bank has also returned the cheques on the ground that the drawer's signatures found on the cheques differ. It is, but natural for the bank to return the cheques if the drawer's signature differs C.C.NO.25147/2018 22 from the original signature found in the bank records. It is known only to the drawer as to why he made such signature that too on series of the cheques, which differ from the signature found in the original records of the bank. The reason is obvious. In this context, the contention of the learned counsel for the respondent that intentionally drawer must have changed his signature with the sole intention that the cheques should not be honored, cannot be lightly brushed aside.
Para 7: learned counsel for the petitioner relied upon various judgments in support of his contention that if the cheques are returned by the bank with an endorsement of "alteration in date and drawer's signature differs", same will not come within the purview of section 138 of the Negotiable Instruments Act. The judgment relied upon by the petitioner's counsels as Shri Babulal Nainmal Jain V/s Shri Khimji Ratanshi Dedhra and Others, Rejikumar V/s Sukumaran, T.Kalavathy V/s. Veera Exports, Rameshchandra Rajnikant Kothari V/s Gunvantalal Shivalal Shan & Anr, Omprakash Bhojraj Maniyar V/s Swati Girish Bhide & Ors and G.Venkataramaaiah V/s Sillkollu Venkateswarlu & Another. Further submits that the aforementioned case law demonstrates how the accused persons attempt to evade liability by altering their usual manner of signing, thereby disguising their signature. Further submits that multiple judicial precedents have been cited and placed before this court to establish that handwriting identification by experts is not a reliable form of evidence. It is well settled that such evidence cannot be relied upon in isolation and must necessarily be corroborated by other factual circumstances to establish its probative value.
C.C.NO.25147/2018 23
27. The complainant relies the citations reported in (2023) 10 SCC 148, (2021) 5 SCC 283, (2019) 16 SCC 83, (2019) 10 SCC 287, (2018) 8 SCC 165 and (2010) 11 SCC 441. Hence, he prays to punish the accused and allow the complaint.
28. The learned counsel for the accused has argued that there was no legally enforceable debt/liability to the complainant from the accused for which the cheque was issued. Further argued that the accused had issued two blank cheques to the complainant for providing account details of the accused and one of the cheque was misused by the complainant. 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. It is further argued that the complainant is only in order give trouble to the accused and with an intention to make illegal money from the accused filed false case. This is not permissible under the law. Further argued that blank cheque was collected from the accused for account details. On looking it Ex.P.2 whereas, signature, the writing part of the cheque amount in words and in figure are different hand writings. Therefore, the entire cheque was filled up by the complainant as their whims. The complainant created all the documents and filed this false case. Further C.C.NO.25147/2018 24 argued that there is no due from the accused to the complainant as stated in the complaint. Further argued that the accused has not issued the alleged cheque in favour of the complainant for discharge of any liability, but the said cheque was issued only to provide bank account details of the accused. It is further argued that the complainant has misused the cheque by forging the signature and filling the same as per their convenience. Hence, the case of the complainant is not maintainable and the accused is not liable to pay any amount to the complainant.
29. The learned counsel for the accused has filed written argument. In his written argument reiterated the facts of the case. It is further submits that this court condoned the delay of 4 days in filing the complaint vide orders dated: 11.06.2019 and thereafter on 05.07.2018, cognizance was taken of the alleged offence punishable under section 138 of N.I.Act and process was issued against the accused. Further the accused entered appearance and obtained bail by furnishing the cash security as directed by this court and she was also examined under section 251 Cr.P.C wherein she denied the charge. Further the defence of the accused from the inception is that the cheques were issued without signatures to provide account details of newly opened account and that the said C.C.NO.25147/2018 25 cheque was misused by forging her signature and that the account were not reconciled for the purpose of arriving at the exact outstanding due/debt amount. Further submits the accused filed application under section 45 of the Indian Evidence Act, praying this court to send Ex.P.2(a) signature and Ex.P.2-cheque for expert opinion of the forensic laboratory in Bengaluru on the signature and handwriting on the body of the cheque by comparing the admitted signatures of the accused. This court initially passed the order dated:
27.09.2019 rejecting the said application.
30. It is further submits that the accused preferred criminal revision petition No.843/2019, which was allowed vide orders dated: 08.01.2020, whereby this court was requested to rehear the application filed U/s.45 of Indian Evidence Act, at an appropriate stage and dispose of the same afresh in accordance with law.
Thereafter this court passed orders allowing the application filed by the accused and thereby sending the admitted signatures of the accused as well as the disputed signature on Ex.P.2-cheque to the handwriting expert i.e., Truth Labs. After detailed examination of the signatures referred by this court as per the standard, recognized and established methods, the hand writing expert submitted his opinion report dated: 26.12.2023 (Ex.C.2) under cover his letter dated: 03.01.2024 C.C.NO.25147/2018 26 (Ex.C.1) opining that there are dissimilarities between the admitted signatures of the accused and the disputed signature on Ex.P.2 and that they were not written by one and the same person. Further submits that the complainant examined its director, Mr.Devidasan as PW.1 and marked Ex.P.1 to 13, in support of the prosecution and he was cross examined by the counsel for the accused. The accused examined herself in defence as DW.1 and she was cross examined at length by the counsel for the complainant wherein DW.1 has asserted her defence and nothing was elicited from her to discredit defence version/ evidence. Further at the instance of the complainant, the expert i.e., the author of Ex.C.2 report dated:
26.12.2023, Sri.Shankrappa Mural, Director-
Documents Division of M/s. Truth Labs was examined as CW.1 and he was cross examined by the counsel for the complainant. In the chief examination and cross examination of CW.1 was recorded by the advocate Commissioner appointed by this court. Nothing has been elicited during the cross examination of CW.1 to discredit his Ex.C.2 opinion and/or the statements given by him during his chief examination that Ex.P.2(a) signature is not that of the accused.
31. Further submits that the complainant failed to prove the existence of legally enforceable debt. Ex.P.8 C.C.NO.25147/2018 27 ledger of the Hyderabad branch of the complainant from 01.04.2013 to 02.01.2018 and Ex.P.9 ledger of Vijayawada Branch of the complainant from 01.04.2013 to 30.11.2017 mention "Venkateshwarasiddi Corporation", whereas the name of the firm of the accused is admittedly "Sri.Venkata Vara Siddhi Corporation", which are totally different. Further, there is no acknowledgment of the accused on Ex.P.8 and 9 ledgers and thus, they are self serving and cannot be accepted/countenanced as proved even remotely by this court. Similarly, the so-called 49 invoices under Ex.P.7 (collectively) are also showing "Venkateshwarasiddi Corporation", which is not the firm of the accused. Thus, neither Ex.P.8 & 9 ledgers nor Ex.P.7 invoices can be taken to be pertaining to the accused or as proved by the complainant, to show any legally enforceable debt, firstly because of the mismatch/discrepancy of the name of the accused firm and secondly, because of the non-confirmation/non- acknowledgment of the same by the accused.
32. Further submits that the purported return memo dated: 13.12.2016 under Ex.P.3 does not bear the stamp of the Bank or signature of the bank officials and hence, it cannot be accepted even as a prima facie of evidence under section 146 of N.I.Act. The accused relies the citation the Hon'ble Bombay High Court in the C.C.NO.25147/2018 28 case of Tajendrasingh V/s Ravindrakumar, reported in (2019) 3 Mah LJ 612. Upon the accused raising the said objection, the complainant filed an application U/s.311 of Cr.P.C for summoning branch manager, SBI Jayanagar Branch, which came to be allowed. The examination of PW.2 does not cure the defect incurred by the complainant at the time of institution of the complainant itself. Further submits that coming to the main defence, as per the orders of this court under section 45 of Indian Evidence Act the expert opinion in the form of Ex.C.2 report clearly shows that Ex.P.2(a) signature on Ex.P.2-cheque is not of the accused and when the disputed signature of the accused on the cheque in question is not proved, section 138 of N.I.Act itself is not at all attracted. Even assuming that the presumption under section 139 read with section 118 of the N.I.Act is even remotely available to the complainant, it is a rebuttable presumption and it is very well settled by a plethor of judgment of Supreme Court that:
i) the initial burden of the accused to rebut the presumptions will stand discharged by raising probable defence;
ii) once the accused discharges the said burden, the onus thereafter shifts on the complainant to prove his case;
iii) the burden of rebuttal of presumption on the accused in not as heavy as that of prosecution and C.C.NO.25147/2018 29 such onus is comparable with that of a defendant of civil proceedings;
iv) the accused need not disprove the case of the prosecution in its entirety;
v) the accused can discharge the burden on the basis of preponderance of probabilities through direct of circumstantial evidence;
33. The accused relies the citations [M.S.Narayana Memon alias Mani V/s State of Kerala- (2006) 6 SCC 39; Krishna Janardhan Bhat V/s. Dattatraya G.Hegde; and Dattatraya Vs. Sharanappa 2024 SCC Online SC 1899]. It is further submits that since the disputed cheque-Ex.P.2 does not bear her signature is prove by Ex.C.2-Expert opinion/Report dated: 26.12.2023, which is relevant materials as per section 45 of the Indian Evidence Act, the accused has discharged the burden of rebuttal of presumption by a probable defence, even assuming for the sake of argument that the said presumption under section 139 read with section 118 of the N.I.Act is available to the complainant. In other words, the accused improbablised the case of the prosecution, which is sufficient to rebut the presumption in favour of the complainant. After the accused discharged her burden of rebuttal of the presumption, even though the onus shifted on to the complainant as per law to prove its his case, the complainant failed to discharge the said onus, C.C.NO.25147/2018 30 thus the prosecution is liable to fail. Further the Apex Court in the case of Mrs Kalyani Basker V/s Mrs M.S.Sampoornam-(2007) 2 SCC 258 held that: opinion of the handwriting expert to ascertain the genuineness of signature on the dishonored cheque is aimed at rebutting the presumption U/s.139 of N.I.Act and it becomes relevant material for consideration for the Magistrate to decide the case after trial in accordance with law.
34. Further the contention of the complainant that they are in possession of another cheque No.247310 for Rs.50,00,000/- under Ex.P.11 cannot be accepted by this court, because when the total outstanding amount even as per the complainant is Rs.1,98,70,918/-, the question of the accused issuing two cheques one for Rs.1.50 lakhs and another for Rs.50 lakhs, totaling to Rs.2 crore i.e., more than the outstanding amount does not arise at all. Hence, the version of the complainant cannot be believed, as it appears that two unsigned cheques were issued by the accused to the complainant for its Hyderabad branch and Vijayawad branch separately. As per the orders dated: 21.11.2024 passed by this court in the application filed by the complainant purportedly under section 91 of Cr.P.C-Section 94 of BNSS directing the accused to produce certain document, the accused C.C.NO.25147/2018 31 interalia produced the ledger statement maintained in respect of the transaction with the complainant during the years 2013 to 2015. As per the said Ledger statement, the accused does not owe any amount to the complainant and on the contrary, it shows a closing receivable balance from the complainant. It has been the consistent defence of the accused that the accounts must be reconciled, for which the complainant never came forward. The complainant has miserably failed to bring home the charge under section 138 of N.I.Act. Hence, the complaint is liable to be dismissed. Hence, he prays to dismiss the complaint.
35. 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 she had issued the cheque- Ex.P.2 in favour of the complainant. It is not disputed that the complainant is a private limited company and the accused is a Proprietor and businesswoman and she had issued the cheque-Ex.P.2 in favour of the complainant. Whereas, the accused has contended that for providing account details of the accused she had issued two unsigned blank cheques in favour of the complainant. The complainant have misused the one of the cheque by forging the signature and filling the same as per their convenience. The accused has specifically denied having debt/liability issued the cheque-Ex.P.2 C.C.NO.25147/2018 32 on 12.12.2016 towards part payment of the outstanding dues. She contends that one of the blank cheque as was misused by the complainant and a false complaint was filed.
36. In order to attract the offence of the 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 Director as PW.1 and the Branch Manager, SBI SME Jayanagar examined as PW.2 and totally 16 documents were marked at Ex.P.1 to 16. In chief examination, P.W.1 has repeated the averments made by the complainant in the complaint and PW.2 deposed regarding dishonor of the cheque as "funds insufficient" and issuance of bank endorsement. In the present case, the accused has not disputed Ex.P.2 being her cheque drawn on the account of the accused. The said presumption is available to the complainant.
37. As per the section 139 of N.I.Act, there is a 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 C.C.NO.25147/2018 33 accused has disputed the existence of legally enforceable debt/liability, for which Ex.P.2 was issued. In order to prove her defence, the accused has failed to adduce any cogent evidence.
38. In this case the accused has admitted to the business transaction with the complainant, which establishes a prima facie case. The accused has also admitted to issuing the cheque, but claims it was blank and unsigned. The accused's contention that the cheque was issued blank and without signature for providing account details raises questions. Section 138 of N.I.Act presumes that a cheque is issued in a discharge of debt or liability. The accused must prove that the cheque was not issued in discharge of a debt or liability. The court may presume that the cheque is genuine and was issued for a legitimate purpose. Further the accused's claim that the cheque was issued blank and without signature may be questioned, especially if there is evidence to suggest otherwise. If the accused's version of events is inconsistent or contradictory, it may undermine there credibility. The court may presume that the cheque was issued in discharge of a debt or liability, which would shifted the burden of proof to the accused. The accused's issuance of cheque for payment of debt falls within the ambit of section 138 of N.I.Act. The dishonor of the C.C.NO.25147/2018 34 cheque by the bank constitutes an offence under section 138 of N.I.Act. The accused's actions demonstrates a clear intention to cheat and defraud the complainant, making them culpable under the law. In the light of the evidence and legal principles discussed above, this court holds that the accused guilt of the offence under section 138 of N.I.Act.
39. In this case the handwriting expert given a report as per Ex.C.2 concludes that the admitted signature and the disputed signature were not written by the same person. The handwriting expert report- Ex.C.2 was relied upon by the accused to contend that the disputed signature on the cheque-Ex.P.2 was not her. The expert opined that the admitted signature and the disputed signature were not written by the same person. Further during the cross examination CW.1 has admitted that the pen pressure and writing speed are crucial factors in the comparison and assessment of signatures. However, he has further admitted that his report does not include any analysis of pen pressure or writing speed. CW.1 has not considered pen stops in his report. CW.1 has acknowledged in his report that variations in writing style, signature composition, hand positioning, slant, pressure, and speed-whether increased or reduced- can occur due to deliberate disguise. He has also admitted that these factors C.C.NO.25147/2018 35 influence alignment, relative size, and other characteristics of a signature. However, these consideration have not been addressed in his report. CW.1 has also admitted that the probability of error in handwriting identification is higher compared to fingerprint analysis or other forensic identification methods. The expert employed standard methodologies for handwriting comparison, including examining the overall style, letter formation, and pressure patterns. The expert's report states that the admitted signature and disputed signature exhibit distinct difference, suggestings they were written by different individual. However, this court is not convinced that this evidence alone is sufficient to acquit the accused. The accused's admission of issuing the cheque, combined with the inconsistencies in her story, raises doubts about there credibility. The accused claimed that she had issued a blank unsigned cheque, but this claim is not supported by any credible evidence. In fact, the expert's report suggests that the disputed signature may have been forged, but this does not necessarily mean that the accused did not issue the cheque. This court must consider the evidence as a whole, and not relay solely on the expert's report. The prosecution/complainant has established that the accused had a debt liability to the complainant, and that the cheque was issued in discharge of that liability. The C.C.NO.25147/2018 36 accused's defence is based on a claim of issuing a blank unsigned cheque, but this claim is not credible. Further in view of the above discussion, this court holds that the accused has not rebutted the presumption under section 138 of N.I.Act. The accused is therefore guilty of the offence under section 138 of the N.I.Act.
40. 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 produced 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 she had given two blank unsigned cheques in favour of the complainant for providing account details of the accused and there is no due to the complainant. Further taken the defence that as per the ledger statement the accused does not owe any amount to the complainant and on the contrary, it shows a closing receivable balance from the complainant. Further the complainant have misused the one of the blank cheque. Except, the said defence, she has not produced any materials to prove such defence. If she C.C.NO.25147/2018 37 had issued two blank unsigned cheques in favour of the complainant, what prevented the accused to file the complaint 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 said cheque. On which date the accused came to knew about the alleged illegal act of the complainant, she did not whisper about on what date she came to know the alleged cheque illegally misused by the complainant. Admittedly the accused is a businesswoman and having knowledge of the financial transaction, why she has given two blank unsigned cheques to the complainant without anticipating the consequence is not explained by her. So also, she has not stated anything as to what steps she took to receive back the blank unsigned cheques. Moreover, immediately after the alleged blank cheque misused by the complainant she has not lodge complaint before concerned police station or any court. No steps have been taken to receive back the blank cheque, after she came to know about the same.
41. Once issuance of cheque is 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 Rangappa V/s Mohan, reported in 2010 AIR SCW 296, C.C.NO.25147/2018 38 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 rebuttable presumption. Of 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 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.
42. In this case the complainant and the accused concerns had business relationship and had transaction worth about Rs.20 crores. It is not dispute that the complainant supplied the materials to the accused on credit basis and she has received the materials from the complainant as per invoices. It is not disputed that the accused is carrying on business as a dealer for Micromax mobiles and had purchased smart phones from the complainant on credit basis. The accused in order to repayment of entire amount to the complainant she has not produced any single C.C.NO.25147/2018 39 documents before this court. Further there is no question of handing over the blank unsigned cheques to the complainant company for providing account details of the accused does not arise at all. Further the accused had transaction of crores with the complainant and there is no need for the accused to issued a blank unsigned cheque for confirmation of her account. Infact, as the purchaser, it is the accused who requires the bank account details of the complainant, as the accused is liable to pay the complainant and not the other way round as contended by the accused. Further if the accused definitely issued the cheques for providing the account details she had no problem giving a cancelled cheque to the complainant. But the accused did not do so. It clearly shows that the accused in order to repayment of the debt liability had issued the cheque in favour of the complainant. It appears, just to escape from her legal liability, she has taken such contentions without any valid basis.
43. 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.
C.C.NO.25147/2018 40 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 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 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.
44. 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 her defence to the extent of probabilities, it is just and necessary to accumulate undisputed facts in this case.
45. It is not in dispute that bounced cheque belongs to the bank account 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 reasons stated in the dishonor memo as "Funds Insufficient". To consider whether the accused succeeded to rebut the presumption and established the defence to the extent of probabilities, C.C.NO.25147/2018 41 the accused has failed to produce any documents in this regard. Further the accused has taken the defence that she had issued the blank unsigned cheque for providing account details of the accused, in order to prove her defence, the accused has not produced any documents. Thus the defence of the accused cannot accepted that the complainant misused the cheque by forging the signature and filling the same as per their convenience.
46. 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 implies, she is conversant with financial transaction. If the complainant misused the said cheque and had not returned the same, inspite of collecting cheques leaves from her, 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 she did not take any legal action against the complainant, even after filing of the complaint based on Ex.P.2. Further she could have issued a notice to her banker to stop payment or legal notice to the complainant or she could have given complaint to the police station or any court immediately. No such steps C.C.NO.25147/2018 42 were taken by the accused. She simply makes a bald allegation of misuse of blank unsigned cheque against the complainant. It appears, just to escape from her legal liability, she has taken such contentions without any valid basis.
47. Moreover, the complainant have got issued a legal notice to the accused by registered through its counsel calling upon her to make repayment 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 prove the compliance of the requirement under section 138 of N.I.Act. It is not in dispute that Ex.P.2 being her cheque drawn on the account of the accused. In view of the above 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 2 and also cheque return memo-Ex.P.3 it is established that the cheque was dishonored for the reasons "Funds Insufficient''. A legal notice being issued as per Ex.P.4 within one month from the date of dishonor of the cheque is also not in dispute. In the case on hand the accused has not seriously disputed regarding notice send by the complainant on her address and she had issued a reply notice. But, the accused failed to repay the cheque amount. In the case on hand the notice is sent to the accused at her address. When the accused has not C.C.NO.25147/2018 43 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.
48. The learned counsel for the accused has taken another defence that the complainant produced the bank memo for dishonor of the alleged cheque. In the memo there is no seal and signature of the bank.
Hence, the bank memo may be considered unauthenticated due to the absence of a seal and signature. The bank memo, though unauthenticated due to lack of seal and signature, is not entirely unreliable. The complainant examined the Branch Manager, SBI SME Branch, Jayanagar as P.W.2. The bank manager's testimony can establish the authenticity of bank memo, despite the lack of seal and signature. The bank manager's evidence can corroborate the complainant's version of events, strengthening their case. Hence, memo is hereby accepted as evidence. The accused duning her cross examination she admits that in respect of transactions with the complainant company, she had ledger statement. But the accused has not produced balance sheet or ledger account and have not been marked as exhibits in order to prove her defence. It clear that the accused is due to the complainant and she has failed to repay the due amount to the complainant. It is clear C.C.NO.25147/2018 44 that the accused in order to repayment of the due amount she had issued the cheque in question in favour of the complainant.
49. It is not the contention of the accused that thereafter she has paid the cheque amount within stipulated time of 15 days on receiving the legal 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 repaid the cheque amount within stipulated period, as such the accused have committed an offence punishable under section 138 of Negotiable Instruments Act. The present complaint is filed after the accused failed to repay the cheque amount. Even the accused did not whisper anything about the defence while her plea was recorded under section 251 of Cr.P.C. In the judgment of the 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 C.C.NO.25147/2018 45 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.
50. 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 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.
51. The Hon'ble Apex Court in K.Bhaskaran V/s Sankaran Vaidhyan Balan and another, reported in 1999 Cri.L.J 4608, held that if the accused denies issuance of cheque although owned his signature therein, the presumption arises that the cheque was made or drawn for consideration on the date mentioned in cheque. The holder of cheque presumed to have received it for discharge of liability of the drawer. 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 C.C.NO.25147/2018 46 been able to make out a probable case on her behalf.
52. As per the version of the accused is that she has nowhere denied transaction with the complainant. The accused herself has admitted that she is the holder of alleged cheque. It is sufficient hold that the accused has issued the cheque-Ex.P.2 in favour of the complainant and even after she 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 section 138 of N.I.Act. In case of dishonor of cheque, once the execution of cheque is admitted by the accused, then it for her 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 has issued the cheque-Ex.P.2 in order to repay the legally recoverable amount. Therefore, the accused has failed to probables the defence taken by her. 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 business transaction between the complainant and the accused, since the initial presumption is still available, when there is no rebuttal evidence.
53. PW.1 in his evidence has specifically deposed C.C.NO.25147/2018 47 that the complainant carrying business as distributors for Micromax mobiles and other home appliances. The accused is carrying on business as a dealer for Micromax mobile and have been purchasing mobile smart phones from the complainant from time to time on credit basis. It is further deposed that the books of account maintained by the complainant in the normal course of business for the period from September 2013, shows that the accused is due in sum of Rs.1,98,70,918/-. Further deposed that towards part payment of the aforesaid dues the accused issued a cheque 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, this is not disputed by the accused. The accused has failed to probables her defence. Further the accused has failed to rebut the presumption under section 139 of N.I.Act, non furnishing of details of business transaction no consequences to disbelieve the case of the complainant. With these reasons, I answer point No.1 and 2 in the Affirmative.
54. POINT NO.3 AND 4: In order to avoid repetition of facts, these two 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, he has to prove all the requirements of section C.C.NO.25147/2018 48 138 of N.I.Act. Ex.P.2 being her cheuqe drawn on the account of the accused is not in dispute. The said cheque having been dishonored, when it was presented by the complainant before the bank for encashment is also not seriously disputed by the accused. Thereafter, the notice-Ex.P.4 being issued by the complainant not seriously disputed. The accused has not taken up any contention that thereafter she had repaid the cheque amount within stipulated time of 15 days, after service 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. When the accused immediately after receive the notice, she has not repaid the cheque amount and not produced any documents before this court. Hence, the present complaint came to be filed before the court on 18.02.2017 after expiry of stipulated period with the permission of the court. While discussing the point No.1 and 2, this court has already observed that the complainant have proved that the cheque was issued for discharge of legally enforceable liability/debt and in view of the mandatory requirements of section 138 of N.I.Act, being complied with. Hence, the accused is found to have committed an offence punishable under section 138 of N.I.Act. With these observations, I answer point No.3 and 4 in the Affirmative.
C.C.NO.25147/2018 49
55.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 her 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 the offence under section 138 of N.I.Act.
The bail bond executed by the accused is hereby stands canceled.
The accused is sentence to pay fine of Rs.1,60,00,000/- (Rupees one crore sixty lakhs only) to the complainant.
It is further ordered that out of the said fine amount an amount of Rs.1,59,80,000/- (Rupees one crore fifty nine lakhs eighty thousand only) shall be paid to the complainant as compensation as per C.C.NO.25147/2018 50 Section 357(1)(b) of Cr.P.C., and remaining amount of Rs.20,000/- (Rupees twenty thousand only) shall be remitted to the State.
In default of the payment of fine amount, the accused shall undergo simple imprisonment of six months.
(Dictated to the stenographer directly on computer typed by her, corrected by me and then judgment pronounced in the open court on 07 th day of April- 2025) (Soubhagya.B.Bhusher) XXVIII Addl. Chief Judicial Magistrate, Bengaluru City.
ANNEXURE List of witness examined on behalf of the complainant:
PW.1 : Devi Dasan. PW.2 : Ashok Kumar, SBI SME Branch Manager,.
List of documents marked on behalf of the complainant:
Ex.P.1 : Authorization/resolution.
Ex.P.2 : Cheque.
Ex.P.2(a) : Signature of the accused.
Ex.P.3 : Bank memo.
Ex.P.4 : Office copy of legal notice.
Ex.P.4(a) & 4(b) : Postal receipts.
Ex.P.5 : Postal acknowledgment
Ex.P.6 : Reply notice.
Ex.P.7 : Tax Invoices.
Ex.P.8 & 9 : Computerized copy of ledger accounts.
Ex.P.10 : Complaint.
Ex.P.11 : Cheque.
Ex.P.12 : Signature of the account form.
Ex.P.13 : Letter of sanction.
Ex.P.14 : E-mail.
C.C.NO.25147/2018
51
Ex.P.15 : Copy of Register.
Ex.P.16 : Bank statement.
List of witnesses examined on behalf of the accused:
DW.1 : Smt.Snehalath.
List of documents marked on behalf of the accused:
-Nil-
List of witnesses examined on behalf of the court:
CW.1 : Shankrappa Mural.
List of documents marked on behalf of the court:
Ex.C.1 : Letter of sanction. Ex.C.2 : E-mail.
List of documents marked through court commissioner:
Ex.C.1 : Covering letter.
Ex.C.2 : Expert report.
XXVIII Addl. Chief Judicial
Magistrate, Bengaluru City.
C.C.NO.25147/2018
52
07.04.2025 (Judgment pronounced in the Open
Court Vide Separate Sheet)
:ORDER:
Acting under section 255(2) of
Cr.P.C., the accused is convicted for the offence under section 138 of N.I.Act.
The bail bond executed by the accused is hereby stands canceled.
The accused is sentence to pay fine of Rs.1,60,00,000/- (Rupees one crore sixty lakhs only) to the complainant.
It is further ordered that out of the said fine amount an amount of Rs.1,59,80,000/- (Rupees one crore fifty nine lakhs eighty 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.20,000/- (Rupees twenty thousand only) shall be remitted to the State.
In default of the payment of fine amount, the accused shall undergo simple imprisonment of six months.
XXVIII Addl. Chief Judicial Magistrate, Bengaluru City.