Bangalore District Court
M/S Megha Agrotech Pvt. Ltd vs Sri. Bheemsing Rathod on 11 July, 2024
C.C.NO.20097/2020
0
KABC030656682020
Presented on : 18-12-2020
Registered on : 18-12-2020
Decided on : 11-07-2024
Duration : 3 years, 6 months, 24 days
IN THE COURT OF THE XXVIII ADDL. CHIEF JUDICIAL
MAGISTRATE, BENGALURU CITY
Present:
Soubhagya.B.Bhusher,
BA.,LL.B.,LL.M
XXVIII A.C.J.M., Bangalore City.
DATED; THIS THE 11th DAY OF JULY-2024
C.C.NO.20097/2020
Complainant: M/s.Megha Agrotech Private Ltd.,
Having its O/at: No,196, Arakere Gate,
Bannerghatta Road, Bengaluru-560076.
(By Sri.Y.Hariprasad & Ors.,Advs.,)
V/s
Accused: Sri.Bheemsing Rathod S/o Sri Shankar,
Kayaka Parinandi Complex.
Near Hero Service Centre, Opp : First
Railway Gate, Old Adarsh colony,
Bidar-585403
(By Sri.Bandagar Shivaji.,Adv,.)
: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.
C.C.NO.20097/2020 1
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 company registered under the companies Act and the company is authorized Sri.Y.Radhakrishna, Senior Accounts Manager to file this case and prosecute the complaint. The complainant company in interalia, engaged in manufacture and sale of Drip Irrigation System. The complainant have supplied the materials worth of Rs.23,00,000/- against the accused order. Further stated that towards settlement of payment, the accused has issued the cheque No.000005 dated: 15.10.2018 for Rs.23,00,000/- drawn on the HDFC Bank, Bidar in favour of the complainant. The complainant had presented the said cheque on the same day for encashment through its banker State Bank of India, SSI, Bengaluru South. But the said cheque was dishonored on 16.10.2018 with an endorsement "Insufficient funds" in the account of the accused. Thereafter, the complainant on 03.11.2018 got issued a legal notice to the accused through its counsel by RPAD, calling upon him to pay the cheque amount within 15 days from the date of receipt of the notice. The said notice was duly served to the accused. After service of the legal notice the accused neither reply the notice nor paid the cheque amount. As such, the accused have committed an offence punishable under section 138 of C.C.NO.20097/2020 2 N.I.Act. Hence, the present complaint came to be filed before this court on 02.01.2019 after expiry of period.
3. The learned counsel for the complainant have filed an application under section 142(b) of N.I.Act seeking condone the delay of 75 days in filing the complaint. After hearing, my learned predecessor was allowed the application and condone the delay of 75 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.3316/2019. Sworn statement of the complainant was recorded. Since there were sufficient materials to proceed against the accused, an order was passed on 16.12.2020 to register the case in Register No.III.
5. Thereafter, summons was issued to the accused and he has appeared before the court through his counsel and secured bail. He has furnished its necessary papers as complied under section 208 of Cr.P.C,. Thereafter, the plea of the accused was recorded by the court. He has pleaded not guilty and make a defence.
6. The complainant in support of its case, have examined its Accounts Manager as PW.1 and got marked 21 documents at Ex.P.1 to 10 and 20 to 30 and closed its side. During the cross examination of D.W.1 C.C.NO.20097/2020 3 09 documents were marked at Ex.P.11 to 19 by way of confrontation.
7. After closer of the evidence of the complainant, the statement of the accused under section 313 of Cr.P.C., was recorded. He has denied the incriminating evidence appearing against him. In his defence, the accused was examined as DW.1 and no documents were marked on his behalf. But during the course of cross examination of P.W.1 two documents were marked at Ex.D.1 and 2 by way of confrontation.
8. I have heard the arguments on both the sides and also perused the material placed on record.
9. The learned counsel for the complainant has relied upon the citations reported in AIR 2021 SC 1281, (2021) 5 SCC 283, AIR 2019 SC 4003, AIR 2018 SC 3601, AIR 2019 SC 1876, (2019)4 SC 197, AIR 2019 SC 3272 and (2014) 6 SCC 335.
10. The learned counsel for the accused has relied upon the citations reported in ILR 2006 KAR 3579, MANU/KA/8225/2006, Crl.A.No.332/2012 and MANU/SC/1294/2022.
11. Upon hearing the arguments and on perusal of the material placed on record, the following points arise for my consideration:
C.C.NO.20097/2020 4
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.6, towards the discharge of the said legally enforceable debt/liability.?
3.Whether the complainant further proves that the cheque-Ex.P.6 was dishonored for the reasons "Funds Insufficient" in the account of the accused and thereafter the accused had failed to repay the same within the statutory period, inspite of receipt of the 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;
:REASONS:
13.POINT NO.1 AND 2: These two points are inter- related to each other and finding given on any one point will bearing on the another. Hence, in order to avoid repetition of facts, I have taken these two points together for common discussion. The case of the complainant is C.C.NO.20097/2020 5 that he was acquainted with the accused. Further the complainant in interalia, engaged in manufacture and sale of Drip Irrigation System. The complainant have supplied the materials worth of Rs.23,00,000/- against the accused order. Further towards settlement of the payment, the accused had issued the cheque in question in favour of the complainant. The complainant had presented the said cheque through its banker. But the said cheque was dishonored with an endorsement "Insufficient funds". Thereafter, the complainant got issued a legal notice to the accused through its counsel by RPAD, calling upon him to pay the cheque amount within 15 days from the date of receipt of the notice. The said notice was duly served to the accused. After service of the legal notice the accused neither reply the notice nor pay 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 after expiry of period.
14. In support of the case, the complainant have examined its Accounts Manager as P.W.1 and total 30 documents were marked at Ex.P.1 to 30. In the chief examination P.W.1 has repeated the contents taken by the complainant in the complaint. Ex.P.1 is the computerized copy of Incorporation certificate. Ex.P.2 is the Minutes of Meeting. Ex.P.3 to 5 are the Ledger accounts for the period of 01.04.2018 to 01.01.2019, on C.C.NO.20097/2020 6 01.04.2017 to 31.03.2018 and on 01.04.2016 to 31.03.2017. Ex.P.6 is the cheque in question issued by the accused in favour of the complainant dated:
15.10.2018 for Rs.23,00,000/-. Ex.P.6(a) is the signature of the accused. Ex.P.7 is the bank memo dated:
16.10.2018 informing the dishonor of the cheque as Insufficient funds. Ex.P.8 is the office copy of legal notice dated: 03.11.2018. Ex.P.8(a) is the postal receipt. Ex.P.9 is the Postal acknowledgment. Ex.P.10 is the complaint.
Ex.P.11 to 19 are the invoices. Ex.P.20 to 29 are the invoices. Ex.P.30 is the Account statement for the period of 01.04.2015 to 31.03.2016. (Ex.P.11 to 19 are got marked through DW.1).
15. In order to prove his defence, the accused is examined himself as DW.1 by way of affidavit and no documents were marked on his behalf. In his chief examination affidavit D.W.1 has repeated the defence taken by him. But during the course of cross examination of PW.1 two documents were got marked at Ex.D.1 and
2. Ex.D.1 is the letterhead for sending the cheques. Ex.D.2 is the downloaded copy of the judgment.
16. The accused has taken the defence that he had issued the blank cheques to the complainant for the purpose of security. Further the complainant have misused the one of the security cheque and filed a false complaint against the accused. The accused in C.C.NO.20097/2020 7 his defence has not disputed Ex.P.6 having been issued by him. He also does not dispute his signature appearing on the said cheque. Further he contended that he never admitted regarding repayment of amount and there is no transaction between the complainant and the accused as alleged by the complainant. Further he has already paid entire amount to the complainant. But the complainant instead of returning the cheque have misused the same and filed false complaint. The accused have specifically denied having agree to repay the amount of Rs.23,00,000/- to the complainant.
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 by the accused. The learned counsel for the complainant has argued that from the evidence placed on record, it fact that the complainant is in interalia engaged in manufacture and sale of drip irrigation system. The accused has placed order to the complainant, accordingly the complainant have supplied the materials worth of Rs.23,00,000/-. It is further argued that toward settlement of payment against the said transaction the accused had issued cheque in question in favour of the complainant. He further argued that the accused has not denied Ex.P.6 being his cheque drawn on the account of the accused.
C.C.NO.20097/2020 8 When the signature of the accused is not disputed, the presumption under section 139 N.I.Act is to be drawn in favour of the complainant. The accused have 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. He further argued that the accused have failed to produce any believable evidence that he had issued the blank cheques in favour of the complainant for the purpose of security at the time of transaction with the complainant and also why he has not returned back the same is not clear. He further argued that section 139 of N.I.Act, there is a presumption that the cheque has been issued for discharge of legally enforceable debt/liability. In the present case, the accused have not disputed Ex.P.6 being his cheque drawn on the account of the accused. The said presumption is available to the complainant.
18. Further argued that the accused have failed to prove the very fact that the cheque-Ex.P.6 was given to the complainant for the purpose of security only and it was blank when it was given to the complainant. Moreover, section 118 of N.I.Act, there is a presumption that the Negotiable Instruments is drawn on the date, for the amount and in favour of the person as shown in it. It is for the accused to rebut the said presumption. But, in the case on hand no such evidence forthcoming. It was also argued by him that as per the defence by C.C.NO.20097/2020 9 the accused that he had given the blank cheques to the complainant for the purpose of security only. As such, the very defence of the accused is not believable. He further argued that the complainant had presented the said cheque for encashment as per the instructions of the accused, but same was dishonor for the reasons Funds Insufficient, thereafter the complainant got issued a legal notice to the accused, which is marked as Ex.P.8. Further argued that after service of the legal notice the accused neither reply to the notice nor paid the cheque amount, the complainant having no alternative have filed a complaint before this court. The defence of the accused is that he had issued the blank cheques to the complainant for the purpose of security and further taken up the defence that the complainant have misused the one of the security cheque to harass the accused and to make a wrongful gain. The accused in order to prove his defence not produced any materials to rebut the said presumption under section 138 of N.I.Act. Therefore, the accused have committed an offence. Further argued that the accused have taken another defence that the cheque in question had been issued for the purpose security at the time of business transaction with the complainant, but in support of that he has not produced any piece of evidence except Ex.D.1. Even though the issuance of cheque for security/guarantee, the offence under section 138 of C.C.NO.20097/2020 10 N.I.Act is attracted. Further argued that the amount mentioned in the cheque is the amount payable by the accused of the invoices due. Hence, he prays to convict the accused.
19. 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-Ex.P.6 was issued. Further argued that the accused had issued the blank cheques to the complainant for the purpose of security at the time of business transaction with 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 law. Further argued that the cheques were collected from the accused, as security measure. On looking it cheque-Ex.P.6 the signature of the accused is admitted. Whereas, the writing part of the cheque amount in words and in figure are different handwriting. Therefore, the entire cheque was filled up by the complainant as their whims. Further argued that the complainant created all the documents and filed this false case against the accused. Further argued that C.C.NO.20097/2020 11 there is no due from the accused to the complainant. Further argued that the accused has already paid entire amount to the complainant. The complainant instead of returning the cheques they have misused one of the security cheque. When there is no due from the accused, then question of issuance of cheque for repayment of the due amount does not arise at all. Therefore, from the evidence placed on record, very due amount from the accused is not clearly made out whereas the accused is succeeded in rebutting the presumption available under section 139 of N.I.Act regarding existence of legally enforceable debt.
20. The learned counsel for the accused further argued that the complainant have misconceived his purported rights in filing the above complaint on the alleged issuance of cheque by the accused. The cheques was issued by the accused only for security purpose for business transaction between the complainant and the accused. Further argued that the accused entered appearance, this court plea was recorded, readover and explained to the accused, he pleaded not guilty. The complainant examined its Accounts Manager as PW.1 and marked Ex.P.1 to 30 documents. The accused is lead his defence evidence as D.W.1. Further argued that the complainant had received blank cheques from the accused for the purpose of security. Hence, an offence under section C.C.NO.20097/2020 12 138 of N.I.Act is not attracted. Even as per the complaint that whatever the materials supplied by the complainant to the accused is very well cleared and paid upto date. There is no balance or any mismanagement from the accused. The complainant have not made out any case against the accused for the alleged payment of dues as claimed in its complaint. The complaint is also not in accordance with law. Further argued that the complainant have not followed any mandatory procedure laid-down under law and that the claim of the complainant regarding legally recoverable debt is also not that of the amount claimed in the cheque. Admittedly the said cheque was given as security. By taking undue advantage of possession of the cheque, the complainant have foisted a false complaint against the accused. On this ground alone the complaint requires to be dismissed. Further argued that the complainant not produced any documents before this court to prove their case beyond reasonable doubt. The notice under section 138 purportedly issued by the complainant is not in accordance with law. As such, notice itself is not admissible in the eye of law. Hence, he prays to dismiss the complaint with exemplary costs and acquit the accused.
21. In the case on hand the complainant and the accused having some transaction has not been seriously disputed by the accused. Further the accused C.C.NO.20097/2020 13 has not seriously disputed that he had issued the cheque in favour of the complainant. Further it is not disputed that the cheque in question issued by the accused is the account of the accused. It is not disputed that the complainant is a private limited company and the accused is a proprietor and businessman. The accused in order to repayment of the said amount had issued the cheque-Ex.P.6 in favour of the complainant. Whereas, the accused has contended that he had given the chaques to the complainant for the purpose of security. When he had given the cheques, which were blank. The accused has specifically denied having debt/liability had issued the cheque-Ex.P.6 dated: 15.10.2018 towards settlement of payment against the transaction. He contends that the blank cheques given by him to the complainant as one of the cheque was misused by the complainant and a false complaint was filed against the accused.
22. In order to attract the offence under section 138 of N.I.Act, the main ingredients of the existence of the legally enforceable debt/liability, for which the cheque drawn on the account of the accused was given for discharge of the same, are to be proved. The complainant in order to prove its case, have examined its Accounts Manager as PW.1 and 30 documents were marked at Ex.P.1 to 30. In chief examination, he has repeated the averments made by the complainant in C.C.NO.20097/2020 14 the complaint. In the present case, the accused has not disputed Ex.P.6 being his cheque drawn on the account of the accused. The said presumption is available to the complainant.
23. Under 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 accused has disputed the existence of legally enforceable debt/liability, for which cheque-Ex.P.6 was issued. PW.1 during his cross-examination has specifically denied the suggestions made to him that the cheques were issued to the complainant for the purpose of security and same were blank at the time of issuing the same. Further denied the suggestion that the accused has made entire amount to the complainant and there is no due from the accused.
24. 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 proof required for the accused is not so strict as required for the complainant to prove the case, further the accused have to produce some probable evidence, which creates doubt about the existence of C.C.NO.20097/2020 15 legally enforceable debt/liability. In the present case, as per the defence taken by the accused that he had given the blank cheques to the complainant for the purpose of security. Except, the said defence, he has not produced any materials to prove such defence. If the accused had given the blank cheques to the complainant for the purpose of security only, 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, he did not whisper about on what date he came to know the alleged cheque illegally misused by the complainant. Admittedly the accused is a Businessman and having knowledge of the financial transaction, why he has given the blank cheques to the complainant without anticipating the consequence is not explained by him. So also, he has not stated anything as to what steps the accused took to receive back the blank cheques. Moreover, immediately after the alleged blank cheque misused by the complainant he has not lodge any complaint before concerned police station. No steps have been taken to receive back the blank cheques, after he came to know about the same.
25. Once issuance of the cheque and signature C.C.NO.20097/2020 16 are admitted, the statutory presumptions would arise under sections 118 and 139 of the N.I.Act that cheque was issued by the drawer for legally payable debt/liability and for valid consideration. The Hon'ble Supreme Court has held in the case of Rangappa V/s Mohan, reported in 2010 AIR SCW 296, the presumption that the cheque was drawn in discharge of legally recoverable debt is a presumption of law that ought to be raised in every case, though, it is a rebuttable presumption. Ofcourse, the presumption under section 139 and 118 of the N.I.Act are rebuttal presumption. Further it is also held that mere plausible explanation by the drawer is not sufficient and proof of that explanation is necessary. The principle of law laid- down in the above decision is applicable to the facts of this case. In the instant case, since the complainant is in possession of the cheque-Ex.P.6 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.
26. Further the accused has taken contention that the cheques were given to the complainant for the purpose of security only. Further he has already paid entire amount to the complainant. The complainant have misused the one of the security cheque issued by the accused. Hence, an offence under section 138 of C.C.NO.20097/2020 17 N.I.Act is not attracted. In this regard once issuance of cheque and signature are admitted, the statutory presumptions would arise under sections 138 of N.I.Act that the cheque was issued by the drawer for legally payable debt/liability and for valid consideration. In the case of Sripati Singh (Since deceased) through his son Gaurav Singh V/s State of Jarkhand and another, reported in 2021 SCC Online SC 1002, the Hon'ble Supreme court held that; once the cheque is issued as security for the loan and if the loan is not paid back then if the cheque is dishonored which attract 138 of N.I.Act. The principle of law laid-down in the above decision is applicable to the facts of this case. Therefore, the contention of the accused cannot be acceptable that the cheque was given only for security purpose, but without producing any documents, then the accused has to pay the cheque amount when it is presented for encashment which is legally recoverable debt.
27. In the case of K.S.Ranganatha V/s Vittal Shetty, reported in 2021 SCC Online SC 1191, the Hon'ble Supreme Court held that once the cheque is admitted to be that of the accused, the presumption envisaged in section 118 of the Act can legally be inferred that the cheque was made or drawn for consideration on the date which the cheque bears. Section 139 of the Act enjoins on the court to presume C.C.NO.20097/2020 18 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.
28. In the case of Kalamani Tex and another V/s P.Balasubramanian, reported in (2021) 5 SCC 283, the Hon'ble Supreme Court has observed that even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under section 139 of the Negotiable instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt.
"13. Adverting to the case in hand, we find on a plain reading of its judgment that the trial court completely overlooked the provisions and failed to appreciate the statutory presumption drawn under section 118 and 139 of N.I.Act. The statute mandates that once the signature(s) of an accused on the cheque/Negotiable Instruments are established, then these "reverse onus"
clauses become operative. In such situation, the obligation shifts upon the accused to discharge the presumption imposed upon him. This point of C.C.NO.20097/2020 19 law has been crystallized by this court in Rohitbhai Jivanlal Patel V/s state of Gujrat, (2019) 18 SCC 106, Para 18: (2020) 3 SCC (Civil) 800:
(2020) 3 SCC (Cri) 575) in the following words:
(SCC pp. 120-21, para 18)".
"18. In case at hand, even after purportedly drawing the presumption under section 139 of the N.I.Act, the trial court proceeded to question the want of evidence on the part of the complainant as regards the source of funds for advancing loan to the accused and want to examination of relevant witness who allegedly extended him money for advancing it to the accused. This approach of the trial court had been at variance with principle of presumption in law. After such presumption, the onus shifted to the accused and unless the accused had discharged the onus by bringing on record such facts and circumstances as to show the preponderance of probabilities tilting in his favour, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of funds for advancing loan to the appellant-accused".
29. In the present case also, as the accused never disputed his signature and did not deny issuing cheque from his account. The accused did not dispute cheque return memo also. The cheque was returned for the reasons funds insufficient in the account of the accused. Thus, the act clearly lays down presumptions in favour of the complainant with regard to the issuance of the cheque by the accused towards the discharge of liability in favour of the complainant. Further under scheme of the Act, the onus is upon the accused to rebut the presumption in favour of the complainant by raising a probable defence. Such being the legal C.C.NO.20097/2020 20 position, it would be pertinent to refer to the defences raised by the accused to rebut the presumptions in favour of the complainant in this case.
30. Applying the above said principles to the present case and before considering the point whether the accused succeeded to rebut the presumptions and to establish his defence to the extent of probabilities, it is just and necessary to accumulate undisputed facts in this case.
31. It is not in dispute that bounced cheque belongs to the bank account of the accused. It is also not in dispute that signature appearing on the bounced cheque is the signature of the accused. It is also not in dispute that the cheque presented by the complainant came to be dishonored by the banker of the accused for the reasons stated in the dishonor memo. To consider whether the accused succeeded to rebut the presumption and established the defence to the extent of probabilities, the accused has not produced any documents in this regard. It was also contended by the accused that he had given the blank cheques to the complainant for the purpose of security. One of the blank cheque was misused by the complainant. In order to prove his defence, the accused has failed to produce any believable evidence before this court.
32. In the defence there is no ill-will between the C.C.NO.20097/2020 21 complainant and the accused. Hence, misuse of cheque and filing false case is not possible. The accused admittedly having knowledge of business. It is implies, he is conversant with financial transaction. If the complainant misused the said cheque and had not return the same, inspite of collecting cheques leaves from the accused, as a prudent man, the accused should have inquired with the complainant and demanded to return those cheques. No ordinary prudent man would keep quite in such circumstances, without taking any steps. The conduct of the accused is very unusual, because he did not take any legal action against the complainant, even after filing of the complaint based on Ex.P.6. Further he could have issued notice to his banker to stop payment or legal notice to the complainant or he could have given complaint to the police station immediately. No such steps were taken by the accused. He simply makes a bald allegation for misuse of blank security cheque against the complainant. It appears, just to escape from his legal liability, he has taken such contentions without any valid basis.
33. Moreover, the complainant have got issued the legal notice to the accused by registered through its counsel calling upon him to make repayment of the said cheque amount to the complainant. Before a person is held to be guilty of the offence punishable C.C.NO.20097/2020 22 under 138 of N.I.Act, the complainant's have to prove the compliance of the requirement under section 138 of N.I.Act. It is not in dispute that Ex.P.6 being his cheque drawn on 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 also cheque return memo-Ex.P.7 it is established that the cheque was dishonored for the reasons "Funds Insufficient'' in the account of the accused. A legal notice being issued as per Ex.P.8 within one month from the date of dishonor is also not in dispute. In the case on hand the accused have not disputed regarding notice sent by the complainant on his address. But the accused have not given reply to the said notice. Thereby, he could have asserted his defence at an earliest available opportunity. In the case on hand the notice is sent to the accused at his address. When the accused have not seriously disputed the address, 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.
34. It is not the contention of the accused that thereafter he has repaid the cheque amount within stipulated time of 15 days on receiving the notice. Therefore in the case on hand on perusal of the evidence placed on record, all the essential ingredients C.C.NO.20097/2020 23 of section 138 N.I.Act, have been complied with. As the accused have not repaid the cheque amount within stipulated period, the accused have committed an offence punishable under section 138 of Negotiable Instruments Act. The present complaint is filed within the period of one month after the accused failed to repay the cheque amount. Even the accused did not whisper anything about the defence while his plea was recorded under section 251 of Cr.P.C. Except he has issued the cheques for the purpose of security. In view of judgment of Hon'ble Supreme Court in Indian Bank Association V/s Union of India and others, reported in 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 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 wants 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.
35. 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 C.C.NO.20097/2020 24 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. The principle of law laid-down in the above decisions are applicable to the facts of this case. Except some bald contentions, the accused has not been able to make out a probable case on his behalf.
36. The accused has taken the defence that except signature other writings on the cheque-Ex.P.6 is not in the handwriting of the accused, which were filled up by the complainant and it amounts to material alterations, so, the complaint is liable to be dismissed. When the accused admits his signature, he cannot take up a defence that other contents of cheque were filled up by the complainant and it amounts to material alteration. In this respect, ruling reported in 2019 SCC On-line (SC) 138), between Bir Singh V/s Mukesh Kumar, the Hon'ble Apex Court held as under:
"37. A meaningful reading of the provisions of the Negotiable Instruments Act including, in particular, Sections 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in C.C.NO.20097/2020 25 discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer, if cheque is otherwise valid, the penal provision of Section 138 would be attracted.
38. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still the on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence.
40. Even a blank cheque leaf, voluntarily signed and handed over by the accused which is towards some payment. Would attract presumption Under section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt."
37. The principles emerging from the above referred decision make it clear that it is not mandatory and no law prescribes that the contents of cheque should be written by the signatory to the cheque. A cheque can be written by anybody and if the account holder of the cheque signs it, the presumption under section 139 of N.I.Act arises. The principle of law laid- down in above decision is aptly applicable to the facts of this case. In view of section 20 of N.I.Act, the cheque being an inchoate instrument, if the drawer signs and delivers to the drawee, thereby he gives authority to the drawee thereof to make or complete the instrument.
C.C.NO.20097/2020 26
38. As per the version of the accused is that he has nowhere denied transaction. The accused himself has admitted that he is the holder of alleged cheque. The accused is a proprietor and businessman. It is sufficient hold that the accused had issued the cheque- Ex.P.6 and even after he has not repaid the cheque amount the getting of receipt of notice. However, in any manner as the complainant have complied all the terms of ingredients of the provisions of 138 of N.I.Act. The accused is liable for dishonor of cheque. In case of dishonor of cheque, once the execution of cheque is admitted by the accused, then it for him to first rebut presumption arising out of section 139 of N.I.Act. Accordingly, PW.1 has established the case of the complainant that the accused had issued the cheque- Ex.P.6 in order to repay the legally recoverable amount. Therefore, the accused has failed to probables the defence taken by him that Ex.P.6 was the blank cheque and given to the complainant for the purpose of security. Therefore, the accused has failed to rebut the presumption under section 139 of N.I.Act. In the said circumstances, the complainant is not at all required to produce any material as to the financial transaction between the complainant and the accused, since the initial presumption is still available, when there is no rebuttal evidence.
39. PW.1 in his evidence has specifically deposed C.C.NO.20097/2020 27 that the complainant in interalia, engaged in manufacture and sale of Drip Irrigation System. The complainant have supplied the materials worth of Rs.23,00,000/- against the accused order. Further deposed that towards settlement of the payment, the accused had issued the 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, no documents could have been existence the evidencing financial transaction. This factor will not affect case of the complainant to disbelieve the financial transaction between the complainant and the accused. When the accused have failed to rebut the presumption under section 139 of N.I.Act, non furnishing of details of financial transaction no consequences to disbelieve the case of the complainant. The accused have failed to probables his defence. With these reasons, I answer point No.1 and 2 in the Affirmative.
40.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, the complainant's have to prove all the requirements of section 138 of N.I.Act. Ex.P.6 being drawn his cheque drawn on the account of the accused is not in dispute. The said cheque having been C.C.NO.20097/2020 28 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.8 being sent by the complainant not seriously disputed by the accused. The accused have not taken up any contention that thereafter he had paid the cheque amount within stipulated time of 15 days, after service of legal notice. As such, in the present case on 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, he has not paid the cheque amount. The accused have not taken up the any contention that after he had paid the cheque amount within stipulated time of 15 days, after receipt of the notice. As such, in the present case on perusal of the documents, the essential requirements of section 138 of N.I.Act have been complied with. Hence, the present complaint came to be filed before the court on 02.01.2019 after expiry of stipulated period. 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 C.C.NO.20097/2020 29 Affirmative.
41. POINT NO.5: The accused is held to have committed an offence punishable under section 138 of N.I.Act. The complainant have proved its case. The accused has failed to prove his rebuttal for the reasons mentioned above and in view of the mandatory requirements of section 138 of N.I.Act, being complied with. The accused is found to have committed an offence punishable under section 138 of N.I.Act. Since, the said offence is an economic crime, the accused is not entitled for the beneficial provisions of probation of offenders Act. In view of the above discussions and the findings on point No.1 to 4, I proceed to pass the following:
:ORDER:
Acting under section 255(2) of Cr.P.C., the accused is convicted for an offence punishable under section 138 of N.I.Act.
The bail bond of the accused is hereby stands canceled.
The accused is sentence to pay fine of Rs.23,50,000/- (Rupees twenty three lakhs fifty thousand only) to the complainant.
It is further ordered that out of the said fine amount an amount of Rs.23,40,000/- (Rupees twenty three lakhs forty thousand only) shall be paid to the complainant as C.C.NO.20097/2020 30 compensation as per Section 357(1)(b) of Cr.P.C., and remaining amount of Rs.10,000/- (Rupees ten 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 11th day of July 2024) Digitally signed by SOUBHAGYA B SOUBHAGYA BHUSHER B BHUSHER Date:
2024.07.15 16:51:23 +0530 (Soubhagya.B.Bhusher) XXVIII Addl. Chief Judicial Magistrate, Bengaluru City.
ANNEXURE List of witness examined on behalf of the complainant:
PW.1 : Mr.Y.Radhakrishna List of documents marked on behalf of the complainant:
Ex.P.1 : Computerized copy Incorporation certificate.
Ex.P.2 : Minutes of meeting. Ex.P.3 to 5 : Ledger accounts. Ex.P.6 : Cheque. Ex.P.6(a) : Signature of the accused. Ex.P.7 : Bank endorsement. Ex.P.8 : Office copy of legal notice. Ex.P.8(a) : Postal receipt. Ex.P.9 : Postal acknowledgment. Ex.P.10 : Complaint.
Ex.P.11 to 19 : Invoices (Marked through DW.1). Ex.P.20 to 29 : Invoices.
C.C.NO.20097/2020
31
Ex.P.30 : Account statement.
List of witnesses examined on behalf of the accused:
DW.1 : Mr.Bheemsing Rathod.
List of documents marked on behalf of the accused: Ex.D.1 : Letterhead for sending the cheques. Ex.D.2 : Downloaded copy of the judgment.
Digitally signed by SOUBHAGYA SOUBHAGYA B BHUSHER B BHUSHER Date:
2024.07.15 16:51:30 +0530 XXVIII Addl. Chief Judicial Magistrate, Bengaluru City.
C.C.NO.20097/2020 32 11.07.2024 (Judgment pronounced in the Open Court Vide Separate Sheet) :ORDER:
Acting under section 255(2) of Cr.P.C., the accused is convicted for an offence punishable under section 138 of N.I.Act. The bail bond of the accused is hereby stands canceled.
The accused is sentence to pay fine of Rs.23,50,000/- (Rupees twenty three lakhs fifty thousand only) to the complainant. It is further ordered that out of the said fine amount an amount of Rs.23,40,000/- (Rupees twenty three lakhs forty 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.10,000/- (Rupees ten 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.