Bangalore District Court
Shivaraj vs Sri. Suma R on 13 January, 2023
KABC0A0035242022
IN THE COURT OF XIII ADDL. CITY CIVIL & SESSIONS JUDGE,
MAYOHALL UNIT, BENGALURU (CCH-22)
Present: Sri S. Sudindranath, LL.M., M.B.L.,
XIII ADDL. CITY CIVIL & SESSIONS JUDGE
BENGALURU.
Criminal Appeal No.25209/2022
Dated this 13th day of January 2023
Appellant:- Shivaraj, S/o Narayanappa,
Aged about 52 years,
R/at C/o Late Kaiwara Narayanappa,
Near Gandhi Statue Circle,
Behind Ganesha Temple,
Horamavu Village,
K.R. Puram Hobli,
Bengaluru East Taluk,
Bangalore-560113.
(Rep. By Sri Shivagondappa S Zulapi, Advocate)
V/S
Respondent:- Sri. Suma R,
S/o H.S Rajappa,
Aged about 34 years,
R/at MVR Residency,
Flat No.103, Near SBI Bank,
Horamavu Village,
K.R. Puram Hobil,
Bengaluru East Taluk
Bangalore-560113.
(Rep. By B.N.S, Advocate)
2 Cr.A.No.25209/2022
Judgment
KABC0A0035242022
:: JUDGMENT ::
This is an appeal under section 374 (3) of the CRPC filed by the accused challenging the judgment and sentence dated 20/07/2022 passed by the learned XXXIII ACMM, Bangalore in CC 56862/2018 convicting the appellant herein for offence under section 138 of negotiable instruments act and sentencing him to pay fine of ₹ 5,75,000 out of which it is ordered that ₹ 5000 shall be confiscated to state and ₹ 5,70,000/= shall be paid as compensation under section 357 of CRPC to the respondent/complainant and in default of payment of fine to undergo simple imprisonment for a period of 6 months.
2. On filing of the present appeal, this court by orders dated 24/08/2022 suspended the impugned sentence subject to appellant depositing ₹ 1,25,000/= within 30 3 Cr.A.No.25209/2022 Judgment KABC0A0035242022 days and from the order sheet of the Learned magistrate it is forthcoming that on 23/09/2022 the appellant has the deposited the said sum before the Learned magistrate.
3. On issuance of notice the respondent has entered appearance through counsel.
4. I have secured the trial court records and heard both sides and perused the records of the case.
5. The only point that arises for my consideration is;
Whether the impugned judgment and sentence dated 20/07/2022 passed by the learned XXXIII ACMM, Bangalore in CC 56862/2018 convicting the appellant herein for offence under section 138 of negotiable instruments act and sentencing him to pay fine of ₹ 4 Cr.A.No.25209/2022 Judgment KABC0A0035242022 5,75,000/= out of which it is ordered that ₹ 5000 shall be confiscated to state and ₹ 5,70,000/= shall be paid as compensation under section 357 of CRPC to the respondent/complainant and in default of payment of fine to undergo simple imprisonment for a period of 6 months, calls for interference in this appeal?
6. My answer to the above point is in the negative for the following;
:: REASONS ::
7. The facts in brief are that, the complainant/respondent herein has filed the private complaint before the Learned magistrate alleging that, the accused/appellant is well-known for several years and on the strength of the said acquaintance, Accused requested the complainant for hand loan of ₹ 10 lakhs in 5 Cr.A.No.25209/2022 Judgment KABC0A0035242022 2nd week of August 2015 and accordingly, complainant advanced loan of ₹ 10 lakhs by cash on 19/08/2015 to the accused which the accused agreed to repay within 2 years. Ultimately towards repayment of the said loan after several reminders and requests the accused issued 2 cheques for ₹ 5 lakhs each and 1 of the said cheques bearing number 925653 dated 01/06/2018 is the subject matter of the present case. On presentation to the bank the same was returned unpaid for the reason "Instrument Out-dated stale" and after complying with the requirement of issuing legal notice the present complaint was filed alleging offence under section 138 of negotiable instruments act by the accused.
8. The Learned magistrate recorded the sworn statement and issued process and on appearance of the accused, recorded the plea of not guilty. Thereafter in the trial the complainant examined himself as PW 1 and got 6 Cr.A.No.25209/2022 Judgment KABC0A0035242022 marked Ex. P1 to P6 which are respectively the original cheque, cheque return memo, legal notice, postal receipt and postal tracking printout. Ex. P6 is the bank statement of complainant to show his financial capacity to advance the loan. The PW 1 has been cross-examined at length by the Learned counsel for accused. Thereafter, after the 313 statement was recorded the accused has adduced his defence evidence and examined himself as DW 1. In addition, on his behalf, the accused also examined 1 witness as DW 2 to speak about repayment of the loan to the complainant.
9. After evidence of both sides was closed, the learned magistrate after hearing the arguments of both sides, as per the impugned judgment and sentence has convicted the accused for offence under section 138 of negotiable instruments act and sentenced him as aforestated and 7 Cr.A.No.25209/2022 Judgment KABC0A0035242022 aggrieved by the same the accused is before this court in this appeal.
10. At the outset, it is to be noted that, there are no technical defects in the complaint, in that, the cheque is dated 01/06/2018 and it is presented within the period of its validity and returned as per the cheque return memo dated 02/06/2018 at Ex. P2. Within 30 days from the date of the return of the cheque i.e. on 08/06/2018 itself, the legal notice is issued as per Ex. P3 and RPAD receipt is at Ex. P4. Ex. P5 is the print out of tracking consignment from the postal Department website to show service of legal notice on 11/06/2018. Of course, a serious contention is raised by the accused that the notice is not served on the accused which will be considered infra. At this stage, suffice it to note that after 15 days and within 45 days of the date of service, the private complaint is presented before the Learned 8 Cr.A.No.25209/2022 Judgment KABC0A0035242022 magistrate on 12/07/2018. Therefore all the requirements of section 138 of negotiable instruments act are complied in this case and there are no technical defects in the complaint.
11. Now, let me consider one of the main contentions raised by the learned counsel for appellant that there is no due service of the legal notice on accused and Ex. P5 cannot be accepted as proof of the same. In this regard it was argued that just because accused has issued the reply [as per Ex. D3 in connected CC No. 56861/2018], it does not mean that the legal notice is duly served because accused after independently coming to know about the filing of the case before the learned magistrate has issued the reply and not due to service of legal notice. In this case, it is not necessary to consider the validity of Ex. P5 - tracking consignment to decide the question of service of notice for the simple reason that, 9 Cr.A.No.25209/2022 Judgment KABC0A0035242022 service of legal notice is admitted by the accused himself, that too, in his chief examination. In this regard in the chief examination of accused as DW 1 at the bottom of page 1 he has deposed that "only after receiving the notice I came to know that the cheques issued by me in favour of the complainant were bounced". Thereby there is a specific admission by the accused himself regarding receipt of legal notice and therefore the contention raised by the learned counsel for appellant that legal notice was not served is without substance and cannot be accepted.
12. The 2nd important question to be considered in this case is whether the offence under section 138 of negotiable instruments act is attracted because the cheque is returned not for the reason "funds insufficient"
but for the reason "instrument outdated - stale". A related question is whether there is any material alteration in the date of the cheque which renders the 10 Cr.A.No.25209/2022 Judgment KABC0A0035242022 cheque invalid. These 2 contentions are inter-connected since it appears that the endorsement is issued by the bank as noted above on the basis that there appears to be material alteration in the date of the cheque at Ex. P1 and therefore it becomes necessary to look into the cheque at Ex. P1.
13. If Ex.P 1 is looked into, no doubt it appears that, the date is not written naturally as 01/06/2018 but appears that 01/06/2016 is corrected as 01/06/2018. The same cannot be considered as material alteration because as will be discussed infra it is not the case of the defence that cheque was issued in 2016 and 2016 has been materially altered as 2018. Instead it is the defence of the accused that the cheque was given as security in 2012 for loan of ₹ 2 lakhs and when the cheque was given the date was left blank [i.e. 2 signed blank cheques were given as deposed by DW 1]. Therefore, in the 11 Cr.A.No.25209/2022 Judgment KABC0A0035242022 absence of any other material and when the drawer of the cheque has not deposed that, the cheque was dated 1/06/2016 when issued, it is not possible to hold that, the date of the cheque was earlier written as 01/06/2016 and same is altered as 01/06/2018. In absence of any other material, the court cannot jump to the conclusion that, there is material alteration in the cheque and court can only opine that, it appears to be a case of bad handwriting rather than material alteration of the date.
14. Insofar as the endorsement by the bank is concerned it is to be noted that even the bank has not returned the cheque for the reason of material alteration but only returned as "instrument outdated and stale". This endorsement cannot be accepted for the simple reason that, in the connected case being CC 56861/2018 which is appealed in Crl. Appeal No. 25208/2022 which is also being disposed off today, cheque of same date 12 Cr.A.No.25209/2022 Judgment KABC0A0035242022 bearing No. 925651 [i.e. same series as cheque of present case] drawn on the same bank account of the same accused is returned for the reason "funds insufficient". This shows that, as on the said date, said account did not have sufficient balance to honour the cheque for ₹ 5 lakhs. The bank appears to have been influenced by the discrepancy in the date noted supra, to issue the endorsement as "instrument outdated - stale" without any justification for the same when cheque of same series presented on same day is returned as "funds insufficient". Therefore the offence under section 138 of negotiable instruments act is attracted in the present case, since, it is clear that, on said date of presentation, there was "insufficient funds" to honour the cheque.
15. In a case of this nature, wherein there are no technical defects in the complaint, the most important question to be decided by the court is whether the cheque 13 Cr.A.No.25209/2022 Judgment KABC0A0035242022 was issued for discharge of legal liability. In this regard, it is to be noted that, the signature on the cheque at Ex. P1 is not disputed by the accused. This is because the very defence raised by the accused is that, in 2012 for the purpose of his daughter's marriage, the accused had borrowed ₹ 2 lakhs from the complainant and at that time issued 2 signed blank cheques as security and the said cheques have been misused to file the present case and the connected case by wrongly mentioning the cheque amount of ₹ 5 lakhs whereas the said cheques were given as security for loan of ₹ 2 lakhs which is in fact already repaid and it is to substantiate his defence regarding availing loan of ₹ 2 lakhs and repayment of the same and the cheques having been issued as security for the said loan that the accused has examined a witness as DW 2. The detailed evidence on record regarding the said defence is discussed infra but at this stage suffice it to 14 Cr.A.No.25209/2022 Judgment KABC0A0035242022 note that by taking up the said defence the accused admits his signature on the cheque and also admits the issue of the cheque by himself but the only defence is that, it was not issued for repayment of loan of Rs. 10 Lakhs as contended by Complainant, but, issued as security for loan of ₹ 2 lakhs which is already repaid.
16. The law is settled that once the signature on the cheque is admitted, legal presumption arises that the cheque was issued for lawful consideration and it is for the accused to rebut the same. This position of law is laid down by Hon'ble Apex Court in the case of Sampelly Satyanarayana Rao v. Indian Renewable Energy Development Agency Ltd., (2016) 10 SCC 458 : 2016 SCC OnLine SC 954 at page 466, as follows;
17. In Rangappa v. Sri Mohan [Rangappa v. Sri Mohan, (2010) 11 SCC 441 : (2010) 4 SCC (Civ) 477 : (2011) 1 SCC (Cri) 184] , this Court held that once issuance of a cheque and 15 Cr.A.No.25209/2022 Judgment KABC0A0035242022 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-recognised mode of payment [Goaplast (P) Ltd. v. Chico Ursula D'Souza, (2003) 3 SCC 232 : 2003 SCC (Cri) 603] .
(Emphasis Supplied)
17. In the light of the above law and in view of the admission by accused regarding his signature on the cheque it follows that in the case on hand there is a presumption that the cheque was issued towards lawful consideration and it is for the accused to rebut the presumption. No doubt the law is settled that accused is not expected to rebut the presumption beyond reasonable doubt and it is sufficient if accused rebuts the 16 Cr.A.No.25209/2022 Judgment KABC0A0035242022 presumption on the basis of preponderance of probabilities.
18. Let me now examine the material on record and the oral and documentary evidence led by both sides to ascertain whether in the case on hand the accused has rebutted the presumption.
19. The defence of the accused is that the cheque was issued as security for loan transaction of ₹ 2 lakhs of the year 2012 and the 2 cheques which were given in 2012 were not returned by the complainant and misused to file the present case. In this regard the basic flaw in the defence version is that, from 2012 till 2018, the accused has not raised his little finger at any point of time to seek return of the said cheques although accused claims that, the accused repaid the loan of ₹ 2 lakhs within 6 months. There is absolutely no explanation by the accused as to 17 Cr.A.No.25209/2022 Judgment KABC0A0035242022 why he did not issue any legal notice or file police complaint from 2012 till 2018 seeking return of the cheques given as security. It is only after the private complaint was presented on 12/07/2018 that for the 1 st time in the reply dated 26/07/2018 that accused raised the contention that the cheques were given for repayment of loan of ₹ 2 lakhs and has demanded return of the cheques. This conduct of the accused falsifies his contention that the cheques were given in 2012 and the complainant did not return the cheques in spite of repayment of the loan.
20. Apart from this, in the cross-examination of PW 1, at page 4 of the deposition dated 16/12/2019, it is suggested to PW 1/complainant that apart from the security cheques (2 blank signed cheques), he had also obtained bond from the accused for ₹ 2 lakhs and that the bond is still retained by him, which suggestion is 18 Cr.A.No.25209/2022 Judgment KABC0A0035242022 denied. However in the defence evidence of accused when examined as DW 1 he has not whispered about any such bond executed by him in favour of the complainant.
21. In the cross-examination of PW 1 dated 26/02/2020 at page 2 it is suggested that when the cheque was not returned there was conciliation in the house of the corporator in the year 2014 itself. If really the accused was aware in 2014 itself about the reluctance on the part of the complainant to return the cheque which prompted Accused to initiate conciliation in the house of the corporator it was expected of Accused to have issued legal notice then and there or filed a police complaint regarding Non-return of the cheques and having not done so and having waited till 2018 and for the 1 st time raised the contention in the reply notice which is issued after 19 Cr.A.No.25209/2022 Judgment KABC0A0035242022 the filing of the present complaint, the defence verion that, the cheque was given as security is unacceptable.
22. In the cross-examination of PW 1 of even date at page 7 of the deposition, it has been suggested that there was dispute between the complainant and accused because their sites are one behind the other and accused refused to give right of passage to the complainant in respect of property which was given for joint development to Ashwini builders and to wreck vengeance due to the said reason the cheque given in 2012 is misused to file the present false case. However in this regard absolutely no material such as joint development agreement entered into by accused in favour of said Ashwini builders has been produced to substantiate the same. 20 Cr.A.No.25209/2022
Judgment KABC0A0035242022
23. At the time of arguments, Learned counsel for accused vehemently argued that the complainant did not have the financial capacity to advance such a huge loan of ₹ 10 lakhs to the accused. In this regard, to show his financial capacity the complainant has produced and got marked his bank statement as Ex. P6. It is to be noted that, as per the Complaint he had advanced the loan on 19/08/2015. This is stated in the complaint at paragraph 3 and also by PW 1 in his evidence. If the bank statement is looked into, it is seen that, on 14/08/2015 a sum of ₹ 1,333,333 has been deposited into the bank account of complainant by cheque clearing and the entire amount has been withdrawn to self on 17/08/2019. Therefore this material shows that, at the relevant point of time on 19/08/2015 the complainant had the sufficient funds by which he could have advanced the loan of ₹ 10 lakhs to the accused by cash. 21 Cr.A.No.25209/2022
Judgment KABC0A0035242022
24. This material coupled with the legal presumption which is available to the complainant is sufficient to hold that the cheque in question has been issued towards the repayment of the loan of ₹ 10 lakhs stated above and hence the cheque was issued for discharge of lawful liability and the conduct of the accused in not issuing any legal notice or filing police complaint or taking any other action seeking return of the cheque from 2012 to 2018 makes it clear that accused has not rebutted the presumption. In this background the oral evidence of DW 2 is not of much consequence because the law is settled that witnesses may lie but circumstances will never lie. Particularly, when it has been suggested to PW 1 that there was conciliation in 2014 in the house of corporator for return of the cheque and when it has been suggested to PW 1 that there were disputes between complainant 22 Cr.A.No.25209/2022 Judgment KABC0A0035242022 and accused regarding property matter it was expected of the accused to have taken some action such as issuing legal notice or filing police complaint when he was aware that his cheque is available with the complainant and having not done so the defence that the cheques given in 2012 has been misused cannot be accepted and therefore the presumption in favour of the complainant will have to prevail and it has to be concluded that complainant has proved that the cheque in question was issued for discharge of legal liability.
25. In the grounds of appeal memorandum at paragraph 10 and 11 it is contended that although PW 1 has stated that his family members received nearly Rs. 8 crores by selling a property and the share of his branch of the family was ₹ 1,75,00,000/=, no material is produced in this regard. However, I have already held supra that insofar as financial capacity is concerned the 23 Cr.A.No.25209/2022 Judgment KABC0A0035242022 complainant has produced Ex. P6 bank account which shows that at the relevant point of time the complainant had withdrawn ₹ 13,33,000 and therefore it has to be held that complainant has proved that at the relevant point of time, he had the financial capacity to advance loan of ₹ 10 lakhs to the accused.
26. Apart from this, it is contended at paragraph 12 of the grounds that the father's name of the accused is not mentioned in the legal notice. However this contention is irrelevant because as already noted supra DW 1 in his chief examination has himself admitted about the due service of the legal notice.
27. The contention regarding cheque having been returned for reason "instrument outdated - stale" raised at Paragraph 13 of the grounds of appeal memorandum is already discussed supra.
24 Cr.A.No.25209/2022
Judgment KABC0A0035242022
28. In view of the above discussion I hold that the learned magistrate was correct in coming to the conclusion that the cheque was issued for discharge of legal liability and accordingly the learned magistrate was correct in convicting the accused and sentencing him as aforestated. Accordingly the impugned judgment and sentence does not call for interference and answering the point for consideration in the negative, I proceed to pass the following;
:ORDER:
The criminal appeal is dismissed. The impugned judgment and sentence dated 20/07/2022 passed by the Learned XXXIII ACMM, Bangalore in CC 56862/2018 is confirmed.25 Cr.A.No.25209/2022
Judgment KABC0A0035242022 Send back the trial court records forthwith.
[Dictated using Dragon Professional Speech Recognition Software Version 15.3, transcript revised, corrected, signed and then pronounced by me in open court on this the 13th day of January 2023] (Sri. S. Sudindranath) XIII ADDL.CITY CIVIL AND SESSIONS JUDGE MAYOHALL UNIT; BANGALORE