Bangalore District Court
R Anguraj vs Praveen Kumar on 7 December, 2024
KABC020150832022
IN THE COURT OF THE XII ADDL. JUDGE, COURT OF
SMALL CAUSES & ADDL. CHIEF JUDICIAL MAGISTRATE,
BENGALURU (SCCH-08)
DATED THIS THE 7th DAY OF DECEMBER - 2024
PRESENT: Smt. Kannika M.S.
M.A., LL.B.
XII ADDL. SCJ & ACJM
MEMBER - MACT, BENGALURU.
C.C. No.7215/2022
Complainant : Sri. R. Anguraj,
S/o. Raja,
Aged about 37 years,
R/at No.106, 2nd Cross,
Ramakrishna Nagar,
Kankapura Road,
Bangalore - 560 078.
(By Sri. G. Manjunatha Reddy,
Advocate)
:Vs:
Accused : Sri. Praveen Kumar,
S/o. Rajan,
R/at No.D.No.2/539,
Periyakarunaipalyam,
Velayuthampalayam Post,
Avinashi - 641654.
Tirupur District,
Tamil Nadu.
(By Sri. Aswath U., Advocate)
SCCH-8 2 C.C.No.7215/2022
Date of complaint : 28.04.2022
Date of commencement of
Evidence : 21.05.2022
Offence charged : Sec.138 of N. I. Act
Date of Judgment : 07.12.2024
Opinion of the Judge : Accused found not
guilty
JUDGEMENT
This is a private complaint filed U/Sec.200 of Cr.P.C. against the accused for the alleged offence punishable U/Sec.138 of Negotiable Instrument Act.
2. The brief facts of the case of the complainant is that:
The complainant, accused and Sri. Saravanan Thambidurai entered into partnership firm on 01.09.2018 as partners of Trinity Solutions carrying on business of developing the home theaters and other allied business activities. As per mutual understanding and partnership deed, complainant invested Rs.18,00,000/- as share capital SCCH-8 3 C.C.No.7215/2022 and became managing director of the firm, accused and Mr. Saravanan to look after the marketing activities without any investment, and they agreed to share profit and loss equally at the rate of 33.3%. Also invested Rs.10,00,000/- towards share capital with an intention to get back the money and to develop the business. But the accused tried to misuse and started diverting business activities. Hence, decided to dissolve the firm and its business. As such, accused wanted to run the business and agreed to settle his claims and accused and Saravanan Thambidurai jointly executed promissory note in favour of the complainant and agreed to pay Rs.10,00,000/- out of which he paid Rs.1,00,000/- and for remaining amount, accused issued cheques bearing Nos.155739 and 155740 dated 20.01.2022 for a sum of Rs.5,00,000/- and Rs.4,00,000/- respectively, drawn on State Bank of India, Avinashi Branch, Coimbatore. As per the instruction of the accused, complainant has presented the said cheques for encashment through his banker Axis SCCH-8 4 C.C.No.7215/2022 bank, J.P. Nagar 6th Phase branch, Bengaluru, but the said cheques came to be dishonored and returned with shara "Payment stopped by the drawer". Hence he has issued the legal notice on 24.03.2022 through RPAD to the accused address and the same was served and also issued corrigendum notice on 14.04.2022 and the said notice is also served. The accused has not paid the amount, and hence, the complainant has filed the present complaint before this Court.
3. Cognizance was taken and sworn statement of the complainant was recorded. Since there were sufficient materials to proceed against the accused, the summons was issued to accused. Accused appeared through his counsel and got enlarged on bail. Substance of accusation was framed, read over and explained to the accused in the language known to him, he denied the same and claimed to be tried. Hence, the case was posted for complainant's evidence.
SCCH-8 5 C.C.No.7215/2022
4. In order to prove his case, the complainant got examined himself as PW-1 and got marked documents at Ex.P1 to Ex.P18 and closed his evidence. After closure of complainant's side evidence, the statement U/Sec.313 of Cr.P.C was prepared and read over to accused, he has denied the same. The accused has not led his defence evidence. Thereafter, case was posted for arguments.
5. I have heard the arguments of learned counsel for complainant. Perused the entire records in this case.
6. The following points arise for my consideration:
1. Whether the complainant proves that, the accused has issued the cheques bearing Nos.
155739 and 155740 dated 20.01.2022 for a sum of Rs.5,00,000/- and Rs.4,00,000/-
respectively, drawn on State Bank of India, Avinashi Branch, Coimbatore and the complainant presented the said cheques for encashment, but the said cheques returned with an endorsement as "Payment stopped by the drawer" ?
2. Whether the complainant further proves that he has got issued the legal notice dated:
24.03.2022 to the accused demanding the cheque amount from the Accused within 15 days from the date of receipt of the notice, the said legal notice is duly served on the accused, SCCH-8 6 C.C.No.7215/2022 but the accused has failed to make the payment of the cheque amount well within the prescribed time and there by committed an offence punishable under section 138 of Negotiable Instrument Act?
3. What order?
7. The finding of this court on the above points is as under:
Point No.1 : In Affirmative,
Point No.2 : In Negative,
Point No.3 : As per final order,
for the following;
REASONS
POINTS NO.1 & 2:
8. Since these points are interconnected, they are taken up together to avoid repetition of facts.
9. According the complaint, he invested amount in start up business and to divided the profit and loss equally. But, accused tried to misused the investment and diverted the business activities for his personal development. When complainant decided to dissolve partnership business, SCCH-8 7 C.C.No.7215/2022 accused and Saravana wanted to continue the business and executed promissory note and agreed to pay Rs.10,00,000/- and out of the said amount paid Rs.1,00,000/- and for remaining amount, the accused issued the post dated cheques bearing Nos.155739 and 155740 dated 20.01.2022 for a sum of Rs.5,00,000/- and Rs.5,00,000/- and 4,00,000/- and respectively, drawn on State Bank of India, Avinashi Branch, Coimbatore and when he has presented the said cheques for collection and for realization, the said cheques dishonored and returned with shara "Payment stopped by the drawer" on 16.03.2022, hence he issued the legal notice to the accused on 24.03.2022 and corrigendum notice on 14.04.2022 through RPAD and the same were served on the accused. The accused has not paid the amount, hence the complaint.
10. In support of his contention complainant has filed affidavit-in-lieu of examination-in-chief wherein reiterated the averments of the complaint and examined as PW.1 and SCCH-8 8 C.C.No.7215/2022 got marked EX P1 to P18 documents. Ex.P1 and 2 are the cheques bearing Nos.155739 and 155740 dated 20.01.2022 for a sum of Rs.5,00,000/- and Rs.4,00,000/- respectively, drawn on State Bank of India, Avinashi Branch, Coimbatore. Ex.P3 and P4 are the Bank endorsments dated 16.03.2022, which shows that cheques are dishonored for the reason Payment stopped by the drawer. Ex.P5 is the legal notice dated 24.03.2022 issued by the complainant through his counsel to the accused for the repayment of the said loan amount. Ex.P6 is the postal receipt, Ex.P7 is the postal acknowledgment, Ex.P8 is the corrigendum notice dt. 14.04.2022, Ex.P9 is the postal receipt, Ex.P10 is the Letter of postal authorities, Ex.P11 is the opened postal cover, Ex.P12 is the promissory note in Tamil language, Ex.P12(a) signature of accused, Ex.P12(b) is the signature of complainant, Ex.P12(c) is the signature of accused in Page No.2 of Ex.P12, Ex.P12(d) is the complainant signature, Ex.P12(e) is the signature of accused in Page No.3 of Ex.P12, SCCH-8 9 C.C.No.7215/2022 Ex.P12(f) is the complainant signature, Ex.P13 is the translated copy of Ex.P12, Ex.P14 is the legal notice dt.21.01.2022, Ex.P15 is the translated copy of Ex.P14, Ex.P16 is the reply notice, Ex.P17 is he postal receipt, Ex.P18 is the postal acknowledgment. Ex.P7 and 10 goes to show that the legal notice as well as corrigendum notice sent to the accused was served on 31.03.2022 and 14.04.2022. The accused has not repaid the amount. Thereafter complainant has filed this case against the accused on 21.05.2022. Hence, complainant has complied the mandatory requirements of Sec.138 of N.I. Act.
11. On the other hand, the Accused has not examined before the court and not marked any documents on his behalf. But in the cross-examination of PW1, he has denied the case of the complainant. The accused specific contention is that complainant has not invested any amount as capital investment to the Trinity Solutions, he has no capacity to invest that much of amount, the complainant had come to SCCH-8 10 C.C.No.7215/2022 the village of the accused and threatened the accused and his wife, taken their cheques and pronote. Thereafter accused has issued the legal notice on 21.01.2022 not to misuse of their cheque and pronote, the complainant has also issued the reply to the said notice on 01.02.2022. The complainant has not whispered anything in his complaint with regard to the issuance of notice by the accused, suppressing the said fact filed the false case against accused. In support of his defence he has relied upon the decision of Apex Court rendered in the case of Basalingappa vs. Mudibasappa((2019) SCC 418).
12. On dissection of evidence placed on record, marshaling of facts and hearing the erudite counsels appearing for the combating parties, the seminal question to be addressed are as hereunder-:
Whether the complainant prove that he is the partner of Trinity Solutions and he has invested the amount of 18,00,000/- and 10,00,000/- as a capital investment?SCCH-8 11 C.C.No.7215/2022
Whether there is any legally recoverable debt?
13. First let me examine whether the complainant is one of the partner of Trinity Solutions, in the cross- examination of the PW.1 counsel of accused has tried to confront one photocopy copy of the partnership deed, but the said document not marked since it is photocopy but it was kept in the record. On perusal of the said partnership deed and also on perusal of the Ex.P14 which is the translated copy of the legal notice dated 21.01.2022 clears that complainant, accused and one T. Saravanan Thambi Durai are the partners of the Trinity Solutions. Let me examine whether the complainant has invested Rs.18,00,000/- and Rs.10,00,000/-as capital investment in the Trinity Solutions. It is only after satisfying that the complainant has proved that he had the requisite funds for investing the sum of money/capital investment in question to the Trinity solutions, then the court can proceeded to draw presumption under section 139 of N.I. Act and SCCH-8 12 C.C.No.7215/2022 thereafter court can find out as to whether or not the accused has rebutted the said presumption.
14. In the decision reported in (2014)2 Supreme Court Cases 236 (between John K. Abraham Vs. Simon C. Abraham and another), wherein, Hon'ble Supreme Court held as hereunder:-
"Debt, Financial and Monetary Laws - Negotiable Instrument Act, 1881 - Ss.118, 139 and 138 - Dishonour of cheque - Drawing presumption under Sectoin 118 R/w. Section - 139 - Prerequisites for, when cheque is repayment of a loan/advanced money-proof required on the part of complainant - Held, in order to draw presumption under section 118 R/w. S.139, burden lies on complainant to show
1) that he had the requisite funds for advancing the sum of money/loan in question to accused 2) that the issuance of cheque by accused in support of repayment of money advanced was true, and 3) that the accused was bound to make payment as had been agreed while issuing cheque in favour of complainant - In present case, complainant not aware of the date when substantial amount of Rs.1,50,000/- was advanced by him to appellant - accused - Respondent complainant failed to produce relevant documents in support of the alleged source for advancing money to accused - complainant also nto aware as to when and where the transaction took place for which the cheque in question SCCH-8 13 C.C.No.7215/2022 was issued to him by accused - complainant also not sure as to who wrote the cheque and making contractor statement in this regard -
In view of said serious defects / Lacuna in evidence of complainant, Judgment of High Court reversing acquittal of accused by trial court, held was perverse and could not be sustained - Acquittal restored".
As per the above Ruling in order to draw presumption U/S.118 R/w. Section 139, burden lies on the complainant to show: 1) that he had the requisite funds for investing the sum of money/capital investment in question to the Trinity solution 2) that the issuance of cheque by accused in support of repayment of money invested was true and 3) that the accused was bound to make payment as had been agreed while issuing cheque in favour of complainant.
15. Now let me test the factual matrix in the light of rival contentions urged by combating parties. The whole fulcrum of the defence of the accused is that, the complainant has no financial capacity whatsoever to invest SCCH-8 14 C.C.No.7215/2022 a huge amount of Rs.18,00,000/- and Rs.10,00,000/-to the Trinity solutions. When this being the specific contention urged by the accused, it is the burden bestowed on the complainant to discharge the initial burden so as to draw the presumption under section 139 of N.I. Act. At the first instance, let me dwell into the complainant averments so as to trace out the genesis of transactions between the parties. It is the specific contention of the complainant that, himself, accused and T. Saravanan Thambi Durai entered into partnership firm on 01.09.2018, and as the initial investment for partnership firm, he invested Rs.18,00,000/- as share capital then also invested Rs.10,00,000/- share capital. To put in encapsulated form, as per the version of the complainant, they have entered into partnership firm on 01.09.2018 and entered in to the partnership deed, the complainant has not produced the said document, but in the cross-examination of the PW1 accused counsel suggested regards to the said deed of partnership and also SCCH-8 15 C.C.No.7215/2022 tried to confront the same but it was not marked as document but it kept with record. On perusal of the document it clears that the complainant, accused and one T. Saravanan Thambi Durai had entered into the partnership deed on 01.09.2018. The PW1 himself admits that "in the said partnership deed there is no recital of the investment of Rs.18,00,000/- and also admits he has not produced any document to show the investment to the Trinity Solutions and voluntarily stated that he has statement and will produce the same. But the complainant has not produced any statement of accounts or piece of documents to show he has invested the said huge amount. It is not emanating from the complaint averment, as to the material details such as, when he has invested and mode of payment of the such a huge amount to the Trinity Solutions? where exactly the said amount was invested? whether there are any documentary proof entered between the parties at the time transactions and such other details. SCCH-8 16 C.C.No.7215/2022 No doubt this court is aware of the fact that, the complainant need not establish each and every minute details and aver the same. But having regard to the peculiarity of the facts and circumstances of the case, these material details warrants for consideration.
16. Be that as it may, now at the first instance let me dwell into whether the complainant has given any proof of his financial stability to invest the said huge amount of Rs.18,00,000/- and Rs. 10,00,000/-. On perusal of the complaint averments he has not stated what is the occupation of the complainant and how he has collected the said huge amount to invest, but he has stated in his cross- examination he has a statement to shown the amount to invest. The complainant has not produced any string of evidence to show his financial capacity to invest of a sum of Rs.18 and 10 lakhs. Though the complainant had admitted during the course of cross examination that, he can produce documents and Bank Statement, but for the reasons best SCCH-8 17 C.C.No.7215/2022 known to the complainant, the said documents have not seen the light of the day yet. Added more, there is absolutely no materials placed on record by the complainant to show that he was having the above said amount with her at that relevant point of time. PW.1 has also admitted that he can produce bank statement of that relevant point of time, but the said bank statement is also not produced before the court. Hence, an adverse inference under section 114(g) of Indian Evidence Act is drawn as against the complainant for non-production of the relevant documents.
17. Yet another aspect which gives importance in the eye of law having regard to the factual matrix is that, according to the complainant accused and another partner namely T. Saravanan Thambi Durai have executed the Pro- note which marked as Ex.P13. On perusal of Ex.P14 which is the translated copy of the said Pro-note and as per the said document accused and one Saravana jointly executed the document for Rs.20,00,000/-. The complainant has not SCCH-8 18 C.C.No.7215/2022 stated why the accused has only issued the cheques for discharge of the amount which was invested as share capital and why he has not taken the steps for recovery of money against both persons who have executed the Pro- note. Further as per the document Ex.P15 which is translated copy of legal notice issued by the accused on 21.01.2022 and reply notice issued by the complainant on 01.02.2022 clears that before presentation of the cheques to the bank accused has issued the notice by takeing contention that the cheques and Pro-note were taken forcefully by the complainant from accused and his wife and also stated not to misuse the same. But in the complaint the said facts were not narrated. If any person has approached the court with clean hands he will disclose each and every thing before the court but complainant has suppressing these facts. Even otherwise also, when the documentary proofs are there, no one can depose against the documentary proof. If one deposes also, that will be SCCH-8 19 C.C.No.7215/2022 contradictory to the principles enumerated under section 92 of Indian Evidence Act.
18. If the complainant has really invested a huge sum of Rs.18,00,000/-, he would have definitely reflected the same in his account statement. Non-disclosure of the same also creates clouds of suspicion. The accused counsel during the coarse of arguments has also relied on a decision reported in 2015(4) K.L.J. 118 (S.C.) (between K. Subramani Vs. K. Damodara Naidu) = 2015(1) DCR 5 Supreme Court of India, wherein Hon'ble Apex Court held as hereunder:-
"N.I. Act, 1881 - Section 138 - Dishonour of cheque - Acquittal - legality - held where complainant had no source of income to lend such huge amount to accused and failed to prove that there is legally recoverable debt payable by the accused to him then acquittal is just and proper".
19. On this point, the decision of Hon'ble High Court of Karnataka in 2016 Supreme Court (Kar.) 116 (between SCCH-8 20 C.C.No.7215/2022 Threja Vs. Smt. Jayalaxmi) reiterates the same principles. The principles laid down in the above case squarely applicable to the case on hand. In the instant case, the complainant has failed to prove that he has source of income to invest such a huge amount of Rs.18,00,000/- and 10,00,000/- as share capital.
20. Though there can be a presumption that a drawee or holder receive the cheque for the discharge of any debt or other liability, there cannot be any presumption regarding the existence of legally recoverable debt. The complainant is bound to prove the existence of such legally recoverable debt liability and that in the event of non-establishment of existence of a legally recoverable debt, the presumption contemplated U/S.139 of N.I. Act does not get attracted. During the course of cross-examination, PW1 had admitted that there is no documentary proof to shown his investment and also return of Rs.1,00,000/-.
SCCH-8 21 C.C.No.7215/2022
21. If really the complainant had invested the huge amount of Rs.18,00,000/- and 10,00,000/- that too in the year 2018 itself, ordinary prudent man without executing any document to invest as share capital, investing such a huge amount creates clouds of suspicion in the mind of court with regard to the version of the complainant's case.
22. According to the complainant accused, himself and one T. Saravanan Thambi Durai were the partners, the said Saravana is managing all affairs of the partnership firm. In order to show the investment of the complainant, there is absolutely no string evidence produced before the court and he was not examined the said T. Saravanan Thambi Durai before this court, in order to substantiate that the transaction, but he was not examined for the reasons best known to the complainant.
23. Further contention urged by the accused is that there is no legally recoverable debt from the accused to the SCCH-8 22 C.C.No.7215/2022 complainant. According to complainant accused has agreed to pay Rs.10,00,000/- and paid Rs.1,00,000/- and issued the two cheques for balance amount, but he has not produced any document to show the said fact except cheques. It is also positively asserted that, there is no transaction between the accused and the complainant whatsoever, from the materials placed on record, and on conspectus perusal of the cross examination of PW.1. Further it is categorically admitted by the PW.1 during the course of cross-examination is hereunder:
ಆರೋಪಿ ಯಾವಾಗ ಮತ್ತು ಎಲ್ಲಿ ಹಾಗೂ ಯಾವ ರೂಪದಲ್ಲಿ ಹಣವನ್ನು ಪಡೆದರು ಎಂದು ನೋಟೀಸಿನಲ್ಲಿ, ಪಿರ್ಯಾದಿನಲ್ಲಿ ಮತ್ತು ಪ್ರಮಾಣ ಪತ್ರದಲ್ಲಿ ಹೇಳಿಲ್ಲ ಎಂದರೆ ಸರಿ, ಆದರೆ ಈ ಬಗ್ಗೆ ಸ್ಟೇಟ್ಮೆಂಟ್ ಇದೆ. ಆರೋಪಿಗೆ ಹಣವನ್ನು ನಗದು ಮತ್ತು ಖಾತೆಯ ಮೂಲಕ ನೀಡಿರುತ್ತೇನೆ. ಈ ವಿಚಾರವನ್ನು ನಾನು ನೋಟೀಸಿನಲ್ಲಿ, ಪಿರ್ಯಾದಿನಲ್ಲಿ ಮತ್ತು ಪ್ರಮಾಣ ಪತ್ರದಲ್ಲಿ ಹೇಳಿಲ್ಲ ಎಂದರೆ ಸರಿ.
24. This part of cross-examination of PW.1 probabalises the defence of accused herein. It is emanating from this cross-examination that, the complaint itself not disclose the primary facts regarding to transaction between SCCH-8 23 C.C.No.7215/2022 the complainant and accused. None of the records discloses that the complainant had such a financial capacity to invested a sum of Rs.18,00,000/- and 10,00,000/-. The evidence which was culled out above reveals that there was a chances of obtain the document forcefully and misused to gulp the cheque amount illegally from the accused. The golden thread which runs through out the judgment is the financial capacity of the complainant to invest a huge amount of Rs.18 and 10 lakhs that too in the year 2018. The whole anchorage of the defence of the accused is on the bedrock when there was no legally recoverable debt.
25. Much was argued by the learned counsel for complainant regarding admissions of signature on Ex.P1 and 2 cheques. No doubt, the accused has admitted the signature, but it is the primary duty of the complainant to show that the cheques were issued towards discharge of legally recoverable debt. In this regard, it is pertinent to rely on a decision of Hon'ble High Court of Karnataka reported SCCH-8 24 C.C.No.7215/2022 in 2015(5) Kar L.J 472 (A.M. Govindegowda V/s B.V. Ravi) wherein Hon'ble High Court of Karnataka held that, "Negotiable Instrument Act, 1881, section 138- criminal procedure code, 1973 section 378(4)- complainant to prove and establish that accused was due to pay a certain sum to the complainant and to clear the said liability he issued a cheque-on facts-held-from evidence placed on record-accused has been able to establish his defence that he has not taken any loan-whereas complainant has not been able to place on record any evidence to establish the existence of liability-order of trial court acquitting the accused is upheld-appeal dismissed".
In the instant case the complainant has failed to prove and establish that the accused was due to pay in total amount mentioned in the cheque which is the subject matter of complainant and to clear the said liability , the accused had issued the said cheque.
26. The interpretation of the expression 'for discharge of any debt or other liability occurring in Section 138 of N.I. Act is significant and decisive of the matter. The explanation appended to Section 138 explains the meaning of the SCCH-8 25 C.C.No.7215/2022 expression 'debt or other liability' for the purpose of Section
138. This expression means a legally enforceable debt or other liability. Section 138 treats dishonored cheque as an offence, if the cheque has been issued in discharge of any debt or other liability. The explanation leaves no manner of doubt than to attract an offence under Section 138 of N.I. Act, there should be legally enforceable debt or other liability subsisting on the date of drawal of the cheque. In other words, drawal of the cheque in discharge of existing or past adjudicated liability is sine qua non for bringing an offence under section 138 of N.I. Act. Therefore in the opinion of this court the cheque issued by the accused in favour of the complainant cannot be held to have been drawn for an existing debt or liability. In the instant case the complainant failed to prove that as on the date of issuance of Ex.P1 and 2 cheque i.e. on 20.01.2022, there was due to be paid by the accused and therefore accused issued a cheque towards the repayment of the investment SCCH-8 26 C.C.No.7215/2022 amount. Hence the payment by cheque in the nature of payment indicates that at the time of drawal of cheque, there was no existing liability. Further more as discussed supra, in order to show that, accused was due of the above said amount there is absolutely no string of corresponding account statement is produced by the complainant. When such is the case mere contention of the complainant cannot be trusted as gospel truth.
27. It is pertinent to note that the presumption under law is rebuttable presumption and it is open to the accused to raise defence whether the existence of legally enforceable debt or liability can be fastened on accused. No doubt, there is an initial presumption which favours the complainant. It is also pertinent to note that, existence of legally recoverable debt is not a matter of presumption U/s.139 of N.I. Act and on the other hand, it merely raises a presumption in favour of holder of the cheque when the same was received towards discharge of any debt or liability. However, the said SCCH-8 27 C.C.No.7215/2022 presumption is rebuttable one provided the accused is able to make out a probable defence which creates doubt in the mind of the court as to the existence of legally recovery debt as on date of issuance of cheque. Therefore, even after raising initial presumption in favour of the complainant U/s.139 of N.I. Act, still the accused has right to rebut the presumption by relying upon the circumstances and the materials placed by the complainant.
28. In the instant case on hand, it is the specific defence of the accused that, there was no existence of legally enforceable debt due towards the complainant as on date of issuance of cheque and the complainant has misused the cheque. From the discussions made above, it is crystal clear that accused has successfully proved that, there is no legally recoverable debt as on date of issuance of Ex.P1 and 2 cheque. The existence of legally recoverable debt is not a presumption U/S.139 of N.I. Act. Therefore, the burden is on the complainant to prove the existence of legally SCCH-8 28 C.C.No.7215/2022 recoverable debt as on issuance of Ex.P1 and 2 cheques. Though the complainant has alleged regarding issuance of cheques is in pursuance of loan transaction, but nothing placed on record to substantiate the said factum. Many allegations are levelled against the accused, but none of them are successfully substantiated by the complainant herein. On the other hand, the accused has proved the defence probably. The factum of issuance of cheque in the instant case as pleaded by the accused is substantiated by eliciting vital admissions. The cross-examination of PW1 goes to show that, the complainant has misused the cheque which was taken from the accused. The transaction which is alleged by the complainant is not at all proved by the complainant. On the other hand, the accused have succeeded in proving the substantial defence.
29. It is argued by learned counsel for accused placing reliance on admission that since Ex.P1 and 2 do not disclose about the legally recoverable debt, there cannot be SCCH-8 29 C.C.No.7215/2022 any presumption raised U/S.139 of N.I. Act. In support of the said contention, it is pertinent to rely on the decision reported in 2016(1) KCCR 196 (Shriram Transport Finance Company Limited Vs Mahadevaiah) wherein Hon'ble High Court of Karnataka held as hereunder:-
"Accused sought for documents got executed by him at the time of lending loan- no documents were produced by complainant to hold accused in debt of Rs.1,20,000/-. Contention of legal debt as on the date of cheque not proved through cogent and convenient advice- adverse inference drawn in favour of accused-Penal provision of section 138 of NI Act could be attracted only when complainant proves that cheque in question was issued for discharge in whole or in part of any debt or other liability".
The ratio laid down by the Hon'ble High Court of Karnataka is aptly applicable to the case on hand, since in this case also the complainant has failed to produce cogent and convincing evidence before the Court to show the existence of legal debt as on the date of issuance of Ex.P1 and2 cheque.
SCCH-8 30 C.C.No.7215/2022
30. Further, it is also relevant to rely on the decision reported in:-
2016 (2) SCC 75 (Bridgestone India (P) Ltd Vs Inderpal Singh) wherein Hon'ble Apex Court held that, "The existence of legally recoverable debt is not a matter of presumption under section 139 of NI Act and it merely raises a presumption infavour of holder of the cheque that the same has been issued for discharge of any debt or liability"
The ratio laid down by the Hon'ble Apex Court aptly applicable to the case on hand, since in this case also the complainant has failed to prove the existence of legally recoverable debt as on the date of issuance of Ex.P1 and 2 cheque. Under such circumstances it cannot be held that, there exists legal debt due to the complainant as on the date of issuance of Ex.P1 and 2 cheques.
31. The complainant herein has utterly failed to prove that Ex.P1 and 2 cheques in question were issued towards discharge of existence debt due to the complainant. On the SCCH-8 31 C.C.No.7215/2022 other hand, accused by eliciting some of the vital admissions during the course of cross-examination of PW1, it is diametrically opposite to the chief-examination has impeached the credibility of PW1. It is the burden on the complainant to prove that cheque in question was issued towards the oral agreement of return of investment amount. Further, complainant has failed to establish the same in this case. The complainant also failed to proved that there was legally recoverable debt.
32. It is well settled principle that, in prosecution under section 138 of NI Act, in order to rebut presumption the accused need not adduce evidence and on the other hand it is sufficient for him to raise a probable defence which could create doubt on the mind of this Court as to existence of legal debt as on the date of issuance of cheque. Needless to say that, the standard of proving the same is that of 'preponderaance of probabilities'. In doing so the accused can rely upon the documents placed by the SCCH-8 32 C.C.No.7215/2022 complainant and also by cross examining the witness. In the case on hand, the accused has successfully rebutted the presumption by raising a probable defence and also cross examining PW1 at length apart from relying upon the documents placed by the complainant.
33. It is settled principle that, everyone charged with criminal offence shall be presumed to be innocent until proved guilty according to law. Further, in determining whether reverse burden is compatible with the presumption of innocence regard should also be had to the pragmatics of proof. Be that as it may, the complainant has failed to discharge his burden of proof shifted upon him beyond reasonable doubt after rebuttal of presumption by the accused. It is relevant to note that, the case of the complainant is required to be rest on his own leg and the same cannot be allowed to be by passed in casual and cosmic manner. The complainant shall however make clear to the Court each of the circumstances relied upon by the SCCH-8 33 C.C.No.7215/2022 complainant to establish drawing of the cheques by the accused. The mere fact that, cheques produced in the Court came from the possession of the complainant alone will not suffice to prove the execution. On the other hand the complainant has to establish the existence of legally recoverable debt due to him from the accused as on the date of issuing of cheque. However, the complainant has failed in all respects in the above case.
34. In the reported decision ILR 2012(4) KCCR 3569 in between S.A. Sabastian V/s. G. Thipperangaiah wherein it is held that ;
"Negotiable Instruments Act-1881-Sections 138 and 139-Cheque being dishonoured-
Accused showing reasonable cause-The accused in entitled to an acquittal. The presumption in favour of the complainant would stand rebutted by such an act".
The existence of legally recoverable debt is not a presumption under Section 139 of the Act; as, Section 139 merely raises presumption in favour of the complainant that SCCH-8 34 C.C.No.7215/2022 the cheque was issued for discharge of any debt and other liability. The principles enunciated in the above decision is culled out and it is aptly applicable to the case on hand. It is held in the above decisions that, something probable in defence has to be proved by the accused. In the instant case, the defence set out by the accused is probable to the effect that complainant has misused the cheque, which was given by her at the time of obtaining loan. On the other hand, no cogent evidence was produced on behalf of the complainant to prove the version. Since these parameters are not satisfied, the complainant shall not be entertained by Criminal Court. From the above discussion, it is very much clear that though the accused admitted the signature, but accused has successfully rebutted the presumption under section 139 of N.I. Act by raising probable defence for the satisfaction of the court.
35. Therefore, the complainant failed to establish that the cheques issued towards the discharge of the debt, which SCCH-8 35 C.C.No.7215/2022 is legally enforceable debt. Since these parameters are not satisfied, the complaints shall not be entertained by the criminal court. In view of above discussion, this court answers Points No.1 in the Affirmative and Point No.2 in the Negative.
36. Point No.3 :- In view of my answer to Point Nos.1 and 2 as above, I proceed to pass the following :
ORDER Acting under section 255(1) of Cr.P.C, the accused is acquitted for the offence punishable under section 138 of the Negotiable Instrument Act.
Bail bond of the accused and surety bond stands cancelled.
Digitally signed by KANNIKA KANNIKA M S MS Date: 2024.12.19 14:52:04 +0530 (Kannika M.S.) XII Addl. Small Causes Judge & ACJM, Bengaluru. SCCH-8 36 C.C.No.7215/2022 ANNEXURE
List of witnesses examined for complainant :-
P.W.1 : R. Anguraj List of documents marked for complainant:-
Exhibits Particulars of the Document
Ex.P1 and 2 Cheques
Ex.P1(a) to 2(a) Signature of Accused
Ex.P3 and 4 Bank endorsements
Ex.P5 Legal notice
Ex.P6 Postal receipt
Ex.P7 Postal acknowledgment
Ex.P8 Corrigendum notice dt.14.04.2020
Ex.P9 Postal receipt
Ex.P10 Letter of postal authorities
Ex.P11 Opened postal cover
Ex.P12 Promissory note in Tamil
Ex.P12(a) Signature of accused
Ex.P12(b) Signature of complainant
Ex.P12(c) Signature of accused in Page No.2 of
Ex.P12
Ex.P12(d) Signature of complainant
Ex.P12(e) Signature of accused in Page No.3 of
Ex.P12
Ex.P12(f) Signature of complainant on Page No.3
of Ex.P12
Ex.P13 Translated copy of Ex.P12
Ex.P14 Legal notice dt. 21.01.2022
Ex.P15 Translated copy of Ex.P14
SCCH-8 37 C.C.No.7215/2022
Ex.P16 Reply notice
Ex.P17 Postal receipt
Ex.P18 Postal acknowledgment
List of witnesses examined for accused:
None List of documents marked for accused:-
-Nil- KANNIKA Digitally signed by
KANNIKA M S
MS Date: 2024.12.19 14:52:13
+0530
(Kannika M.S.)
XII Addl. Small Causes Judge
& ACJM, Bengaluru.