Bangalore District Court
Sri. Pradeep Kumar. B.R vs Sri.A.Krishna Murthy on 22 June, 2020
1 C.C.No.3470/2015 J
THE COURT OF THE XVI ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE, BENGALURU CITY
i. Dated:- This the 22nd day of June, 2020
Present: Sri.S.B.HANDRAL, B.Sc., L.L.B(SPL).,
XVI Addl.C.M.M., Bengaluru City.
JUDGMENT U/S 355 OF Cr.P.C.,
Case No. : C.C.No.3470/2015
Complainant : Sri. Pradeep Kumar. B.R,
S/o. Rudre Gowda,
Aged about 34 years,
Residing at No.220/J,
10th Main, Nagendra Block,
Banashankari III Stage,
Bengaluru -560 050.
(Rep.by Sri. B & S. Associates.,
Adv.,)
- Vs -
Accused : Sri.A.Krishna Murthy,
S/o. Anjinappa,
Aged about 29 years,
R/at No.141,
22nd Main Road,
Chikkallasandra Main Road,
Padmanabhanagar 2nd Stage,
Bengaluru.
And also at :
A.Krishna Murthy,
C/o. Maths Academy,
2 C.C.No.3470/2015 J
No.206, Vekatesh Dass Road,
Padmanabhanagar,
Bengaluru -560 017.
(Rep. by Sri. Naveen Kumar.,
Adv.,)
Case instituted : 18.12.2014
Offence complained : U/s 138 of N.I Act
of
Plea of Accused : Pleaded not guilty
Final Order : Accused is convicted
Date of order : 22.6.2020
JUDGMENT
The Complainant has filed this complaint against the Accused for the offence punishable u/Sec.138 of the Negotiable Instruments Act.
2. Briefly stated the case of the Complainant is that, the Accused had taken financial assistance of Rs. 6 Lakhs on 20.1.2014 from him and agreed to pay interest of 2% p.m. and at the time of receiving the amount the Accused had assured to him that, same would be returned in the month of October 2014, thereafter in the month of October 2014 when he approached the Accused and demanded the 3 C.C.No.3470/2015 J amount, to discharge the liability Accused had issued a cheque bearing No.050608 dated:
14.10.2014 for Rs.6 Lakhs drawn on IDBI bank Banashankari Branch, Bengaluru and assured that said cheque would be honoured on its presentation, accordingly he has presented the said cheque for encashment through his banker which got dishonoured on 15.10.2014 for the reason of "Account Closed" , thereafter he got issued a legal notice to the Accused on 10.11.2014 through RPAD on both the addresses of the Accused and the notice sent to the 1st address has been willfully evaded by him at the collusion of the postman and the notice sent to the 2nd address has been refused by the Accused even though intimation was delivered on him on 12.11.2014, inspite of that, Accused has not repaid the amount neither replied to the notice.
Hence he has filed the present complaint praying that the Accused be summoned, tried and punished in accordance with Sec.138 of the Negotiable Instruments Act.
3. Before issuing process against the accused, the Complainant has filed his affidavit-in-lieu of his 4 C.C.No.3470/2015 J sworn statement, in which, he has reiterated the averments of the complaint along with original documents.
4. Prima-facie case has been made out against the accused and summons was issued against the accused in turn he has appeared before the court and got enlarged on bail and the substance of the accusation has been read over to him, to which he pleaded not guilty and claims to be tried.
5. Thereafter the complainant himself examined as PW.1 by filing his affidavit in lieu of examination in chief. In support of his oral evidence, P.W.1 has relied upon the documentary evidence as per Ex.P1 to P.13 i.e, Original Cheque dated:-
14.10.2014 as per Ex.P.1, the signature on the said cheque identified by P.W.1 as that of the accused is as per Ex.P.1(a) the Bank Memo as per Ex.P.2, the office copy of the Legal Notice as per Ex.P.3, the Postal Receipts as per Ex.P.4 and P.5, returned notices as per Ex.P.6 and P.7, postal covers as per Ex.P.8 and P.9, postal receipts as per Ex.P.10 and P.11 and postal acknowledgements as per Ex.P.12 5 C.C.No.3470/2015 J and P.13 and closed his side.
6. Thereafter, the statement of the accused as required under Sec.313 of the Cr.P.C. has been recorded. He has denied the incriminating evidence appearing against him and has chosen to lead his rebuttal evidence.
7. Accused himself examined as DW.1 and has produced the 9 documents i.e., certified copy of Dairy marked as Ex.D.6 in C.C.No.14181/2015 as per Ex.D.1, certified copy of the Rent Agreement produced in C.C.No.14181/2015 as per Ex.D.2, certified copy of the Aadhar card produced in C.C.No.14181/2015 as per Ex.D.3, certified copy of the Order sheet in C.C.No.3467/2015 as per Ex.D.4, certified copy of the Private complaint in C.C.No.3467/2015 as per Ex.D.5, certified copy of the Vakalathnama in C.C.No.3467/2015 as per Ex.D.6, certified copy of the Order sheet in C.C.No.3468/2015 as per Ex.D.7, certified copy of the Private complaint in C.C.No.3468/2015 as per Ex.D.8, certified copy of the Vakalathnama in C.C.No.3468/2015 as per Ex.D.9 and closed his side.
6 C.C.No.3470/2015 J8. Heard and perused the written arguments submitted by both learned counsels for the complainant and Accused and perused the materials on record and the decisions relied upon by the learned counsel for the complainant are : 1) Crl.
Appeal No.508/2019 in case of Rohitbhai
Jivanlal Patel Vs. State of Gujarat & Anr., 2)
Crl. Appeal No.728/2015 in case of
T.Vasanthakumar Vs. Vijayakumari ; 3) ILR 2019 KAR 493 incase of Sri. Yogesh Poojary Vs.Sri.K.Shankara Bhat.
The learned counsel for the Accused has relied upon the decisions i.e. 1) AIR 2009 SC 1518 incase of Kumar Exports Vs. Sharma Carpets ;
2) AIR 2010 Sc 1898 incase of Rangappa Vs. Mohan; 3) AIR 2019 SC 942 incase of ANSS Rajashekar Vs. Augustus reported in Jeba Ananth; 4) (2019) 5 SCC 418 in case of Basalingappa Vs. Mudibasappa.
9. On the basis of complaint, evidence of complainant and documents and having heard the arguments of both learned counsels for the complainant and the accused, the following points 7 C.C.No.3470/2015 J that are arise for consideration are:-
1. Whether the complainant proves that the accused has issued cheque bearing No. 050608 dated:
14.10.2014 for Rs.6 Lakhs drawn on IDBI bank Banashankari Branch, Bengaluru to discharge legally recoverable debt to the complainant and when the complainant has presented a cheque for encashment through his banker but the said cheque has been dishonoured for the reasons "Account closed " on 15.10.2014 and the complainant issued legal notice to the accused on
10.11.2014 and inspite of it the accused has not paid the cheque amount within prescribed period there by the accused has committed an offence U/s.138 of the Negotiable instruments Act?
2. What Order?
10. The above points are answered as under:
Point No.1: In the Affirmative Point No.2: As per final order for the following:
REASONS
11. Point No.1: Before appreciation of the facts and oral and documentary evidence of the present 8 C.C.No.3470/2015 J case, it is relevant to mention that under criminal jurisprudence prosecution is required to establish guilt of the Accused beyond all reasonable doubts however, a proceedings U/s.138 of N.I.Act is quasi criminal in nature. In these proceedings proof beyond all reasonable doubt is subject to presumptions as envisaged U/s.118, 139 and 136 of N.I.Act. An essential ingredient of Sec. 138 of N.I.Act is that, whether a person issues cheque to be encashed and the cheque so issued is towards payment of debt or liability and if it is returned as unpaid for want of funds, then the person issuing such cheque shall be deemed to have been committed an offence. The offence U/s.138 of N.I. Act pre-supposes three conditions for prosecution of an offence which are as under:
1. Cheque shall be presented for payment within specified time i.e., from the date of issue or before expiry of its validity.
2. The holder shall issue a notice demanding payment in writing to the drawer within one month from the date of receipt of information of the bounced cheque and 9 C.C.No.3470/2015 J
3. The drawer inspite of demand notice fails to make payment within 15 days from the date of receipt of such notice.
If the above said three conditions are satisfied by holder in due course gets cause action to launch prosecution against the drawer of the bounced cheque and as per Sec.142(b) of the N.I. Act, the complaint has to be filed within one month from the date on which cause of action arise to file complaint.
12. It is also one of the essential ingredients of Sec. 138 of N.I.Act that, a cheque in question must have been issued towards legally recoverable debt or liability. Sec. 118 and 139 of N.I.Act envisages certain presumptions i.e., U/s.118 a presumption shall be raised regarding 'consideration' 'date' 'transfer' 'endorsement' and holder in course of Negotiable Instrument. Even Sec.139 of the Act are rebuttable presumptions shall be raised that, the cheque in question was issued regarding discharge of a legally recoverable or enforceable debt and these presumptions are mandatory presumptions that are required to be raised in cases of negotiable instrument, but the said presumptions are not 10 C.C.No.3470/2015 J conclusive and rebuttable one, this proportion of law has been laid down by the Hon'ble Apex Court of India and Hon'ble High Court of Karnataka in catena of decisions.
13. In the present case the complainant got examined as PW.1 by filing his affidavit evidence wherein he has reiterated the entire averments of the complaint and in his evidence testified that, the Accused is well known to him since past several years and had taken financial assistance on 20.1.2014 to the extent of Rs. 6 Lakhs from him and agreed to pay interest of 2% p.m. and assured that, same would be returned in the month of October 2014 and when he approached the Accused in the month of October 2014 and demanded the amount at that time to discharge the liability Accused issued a cheque bearing No. 050608 date:
14.10.2014 for sum of Rs.6 Lakhs in his favour by assuring that cheque would be honoured on its presentation, accordingly he presented the said cheque through his banker which got dishonoured for the reason as "Account closed", thereafter he issued legal notice to the Accused on 10.11.2014 11 C.C.No.3470/2015 J through RPAD on both addresses of the Accused , the notice sent to the 1st address has bee willfully evaded by him at the collusion of the postman and notice sent to 2nd address has been refused by him, even though intimation was delivered on him on 12.11.2014, thereafter till this day Accused has not repaid the amount or replied to the notice.
14. In support of his oral evidence, P.W.1 has relied upon the documentary evidence as per Ex.P.1 to P.13 i.e., Original Cheque dated:-14.10.2014 as per Ex.P.1, the signature on the said cheque identified by P.W.1 as that of the accused is as per Ex.P.1(a) the Bank Memo as per Ex.P.2, the office copy of the Legal Notice as per Ex.P.3, the Postal Receipts as per Ex.P.4 and P.5, returned notices as per Ex.P.6 and P.7, postal covers as per Ex.P.8 and P.9, postal receipts as per Ex.P.10 and P.11 and postal acknowledgements as per Ex.P.12 and P.13.
15. In the present case, there is no dispute between the complainant and Accused with regard to their acquaintance. It is also not in dispute by the accused that, the cheque in question belongs to his 12 C.C.No.3470/2015 J account and signature found at Ex.P.1(a) is also that of his signature. The Accused has also not disputed that the cheque in dispute presented for encashment and dishonoured for the reason of "Account closed"
vide bank endorsement dated:15.10.2014, therefore as a matter on record and has been proved by Ex.P.2 issued by the concerned bank dated: 15.10.2014. Therefore the complainant has proved that, the cheque in question i.e Ex.P.1 was presented within its validity period and dishonoured as per bank endorsement issued by the banker of the Accused and the cheque in question belonging to the Accused account and signature of the Accused is at Ex.P.1(a).
16. In relation to the service of notice the Accused in his defence has denied service of notice upon him. The complainant in order to prove service of notice upon the Accused, has produced the documents i.e copy of the legal notice, postal receipts, returned copies of the legal notices, returned RPAD covers and postal receipts postal acknowledgement which are at Ex. P.3 to P.13 respectively. On perusal of the Ex.P.9 i.e. the RPAD returned cover with an endorsement of "Intimation 13 C.C.No.3470/2015 J delivered dated: 11.11.2014, 12.11.2014 ". Hence, it goes to show that, the legal notice caused by the complainant through RPAD to the 2nd address of the Accused shown in the notice returned with postal endorsement of "Intimation delivered dated: 11.11.2014, 12.11.2014". The Accused during the course of cross-examination of complainant and in his evidence has not denied or disputed that, the address mentioned by the complainant on RPAD cover i.e. on Ex.P.9 is not of his correct address but he contends that, since September 2014 itself the Accused was not in either of the two addresses shown in the complaint and legal notice and inspite of aware of the said fact, the complainant has sent the legal notices to the said addresses and Accused never carried out his business in the 2nd address but the complainant in his cross-examination has clearly denied the suggestions made to him to that effect and stated that, before sending of legal notice to the Accused he had verified about the said addresses. The very suggestions made by the Accused in respect of address mentioned by the complainant in the legal notice, postal receipts and acknowledgements is admitted by the Accused that, the Accused was 14 C.C.No.3470/2015 J resided in the said address but the only defence of the Accused that, since September 2014 itself the Accused was not in either of the two addresses shown in the complaint and notice, to that effect burden is on the Accused to prove that, he has vacated from the said addresses since September 2014 itself, but the Accused except the said suggestions has not produced any documents to show that, since September 2014 itself he was not in either of the two addresses shown in the complaint and legal notices. Apart from that, the Accused in his cross-examination at page No.2 has clearly admitted that, "¤¦.3 gÀ £ÉÆÃnù£À°è vÉÆÃj¹zÀ 2 £Éà «¼ÀÁ¸ÀzÀ°è £Á£ÀÄ ªÀiÁåxïì CPÁqÉ«Ä £ÀqɸÀÄwÛzÉ£Ý ÀÄ JAzÀgÉ ¤d DzÀgÉ ¸É¥ÉÖA§gï 2014 gÀªÀgÉUÉ £ÀqɹgÀÄvÉÛãÉAzÀÄ ¸ÀévÀB ºÉýgÀÄvÁÛgÉ. ¤r.2 £Á£ÀÄ ªÉÄʸÀÆj£À°è ªÁ¸ÀªÁVgÀĪÀ «¼Á¸ÀzÀ gÉAmï CVæªÉÄAmï EgÀÄvÀÛzÉ. ¤¦.3gÀ°è vÉÆÃj¹zÀ 2 £Éà «¼ÀÁ¸ÀzÀ°è £Á£ÀÄ ªÀiÁåxïì CPÁqÉ«ÄAiÀÄ£ÀÄß ¸É¥ÉÖA§gï 2014 gÀ°è SÁ°ªÀiÁrzÀ §UÉÎ zÁR¯É ºÁdgÀÄ ¥Àr¹gÀĪÀÅ¢®è." Hence, the said admissions of the Accused makes it clear that, he has admitted that, 15 C.C.No.3470/2015 J he was running "Maths Academy" in the 2nd address mentioned in the legal notice and has not produced any document to show that, he has vacated the said address since in the month of September 2014 itself, in such circumstances unless and until the Accused furnished documents or proved the fact that, he is/ was not residing or resided since from month of September 2014 in the 2nd address as shown in the legal notice i.e Ex.P.3, it cannot be held that, as on the date of issuance of the legal notice the Accused was not resided in either of the addresses shown in the legal notice i.e Ex.P.3 as contended by him in his defence. The Accused has also produced copy of the Rent Agreement which is at Ex.D.2 but on perusal of the said document it appears that, the Accused has entered into agreement with one Sri. A.Krishna Murthy in respect of the house property bearing D.No.29, situated at MMG Century Behind KHB colony, Belavadi post, Hootagalli, Mysore. The Accused has produced the Ex.D.2 to show that as on the date of rent agreement he was residing in the address shown in rent agreement i.e in the Mysore but not in the address shown by the complainant in his legal notice i.e Ex.P.3. But the contents of the 16 C.C.No.3470/2015 J Ex.D.2 nowhere discloses that, as on the date of rent agreement the possession of the house property mentioned therein was handed over to the Accused and even the Accused has not examined the owner of the said house i.e. the Rent agreement executed in favour of the Accused, in such circumstances it cannot be held that, as on the date of issuance of the legal notice or service of notice, the Accused was not resided in the addresses as mentioned by the complainant in the legal notices i.e Ex.P.3. Even the Ex.D.2 discloses that, the Accused has entered into agreement in respect of the house property situated at Mysore on 15.4.2014 it cannot be held that, since then Accused is residing in the house property mentioned in Rent Agreement i.e. Ex.D.2 as law does not allow to presume that, the person who entered into rent agreement is residing in the property involved in the rent agreement since the date of agreement, unless the tenant proved that, the possession of the rented premises handed over to him as on the date of agreement and since the date of agreement he is residing in the rented premises, on this count also only on the basis of production of rent agreement i.e Ex.D.2 it cannot be held that, 17 C.C.No.3470/2015 J Accused is residing in the rent preemies or house property shown in Ex.D.2 since the date of its agreement. It is also important to note that as it is already held in the above that, the Accused has admitted that he was running Maths Academy in the 2nd address shown in the legal notice issued by the complainant and has failed to produce document to show that, since September 2014 itself he was vacated from the said address or he was not resided in the said address, therefore it can be held that, the Accused has admitted his correct address to which the complainant issued the legal notice. Apart from that, it is not the defence of the Accused that, the complainant by colluding with the postal authorities got created the postal endorsement on the Ex.P.9 RPAD cover, in such circumstances it can be held that, Accused has admitted the endorsement issued by the postal authorities on Ex.P.9 i.e., the intimation was given to the Accused on 11.11.2014 and 12.11.2014 and the Accused has not examined concerned postal authorities to disprove the endorsement found on Ex.P.9 RPAD cover. Therefore in view of non disputing of the address of the Accused in the legal notice as well as 18 C.C.No.3470/2015 J on the RPAD cover makes it clear that, the Accused has admitted that, the legal notice caused by the complainant was issued to his correct address through registered post, in such circumstances, it can be held that, the notice sent by the complainant to the correct address of the Accused is presumed to have been served on him U/s. 27 of General Clauses Act. In this regard, it is relevant here to refer the decision of Hon'ble High Court of Karnataka reported in 2011 ACD 1572 (KAR) in the case of Jayamma Vs. Lingamma, wherein the Hon'ble High Court held that, "Notice sent at correct address returned unclaimed - is deemed to be served. In another decision reported in 1998 KAR 1841 in the case of Shridhar M.A. Vs. Metalloy Steel Corporation and 1999 Cri.L.J. 4606 "K. Bhaskaran Vs. Vaidhanbalan wherein the Hon'ble Apex Court was concerned with the question as to when the service of notice could be inferred and it was held that if there is an endorsement like 'not available in the house' 'house locked' 'shop closed' 'unclaimed' the service should be deemed to have been effected. It is also relevant here to refer the decision reported in 2008(4) Civil code 19 C.C.No.3470/2015 J cases 027 (SC) "M/s. Indo Automobiles Vs., M/s. Jai Durga Enterprises and others." wherein the Hon'ble Apex Court held that, notice sent by registered post with acknowledgement to a correct address-service of notice has to be presumed. Therefore in view of the principles of law in the above decisions, it can be safely held that, the service of notice on accused in this case is presumed to have been served on him since in this case also the complainant has issued notice to the accused to his correct address through registered post and the said notice was returned with an endorsement of "Intimation delivered on 11.11.2014 and 12.11.2014 ", hence, the notice issued by the complainant through registered post is held to be proper . In addition to that, it is relevant here to refer the decision reported in 2007 AIR SCW 3578 in the case of C.C.Alavi Haji Vs. Palapetty Muhammed and another., wherein the Hon'ble Apex court held that " the drawer of the cheque is permitted to deposit the cheque amount within 15 days from the date of his appearance before the court in pursuance of the service of summons on him and in such situation, his defence of non service 20 C.C.No.3470/2015 J of the legal notice cannot be available to him'. Hence, in view of the said principles of law, even for sake of discussion, though there is no cogent and reliable documentary proof to substantiate the claim of the complainant with regard to address of the Accused to show there is due service of the legal notice on the Accused, in view of settled position of law by virtue of the above said decision of Hon'ble Apex Court of India, the Accused is not entitled to the technical defence of the alleged non service of the legal notice. Therefore, the contentions taken by the learned counsel for the accused that, the notice issued by the complainant was not served on the accused and the complainant has not complied the mandatory requirements of Sec.138(b) of N.I.Act and complaint is not maintainable cannot be acceptable and are not sustainable in law.
17. It is also the defence of the Accused that, the complainant had no source of income to lend alleged loan amount of Rs.6,00,000/= specifically on 20.1.2014 and he had not obtained any amount on that day and complainant has not produced any document to show that, as on 20.1.2014 he was 21 C.C.No.3470/2015 J having an amount of Rs.6 Lakhs and the Accused has not issued the cheque in question i.e Ex.P.1 to the complainant towards discharge of loan amount. In this regard, the learned counsel for the Accused cross-examined the complainant in length but nothing has been elicited to discredit or discard her evidence, instead of eliciting anything materials from the complainant the Accused rather concentrated his defence that, there was no financial transaction between him and the complainant and Accused has not received any amount on 20.1.2014 from the complainant, but the suggestions made by the Accused to that effect were stoutly denied by the complainant. It is true that, complainant in his cross-examination admitted that, he had Rs.2.5 Lakhs in cash at home given by his client and he had Rs.3.5 Lakhs withdrawn from the Apex Bank. It is also true that, the complainant has not produced the documents to substantiate the same. It is also true that, the complainant /PW.1 has admitted that, there was an agreement executed in respect of the loan dated: 20.1.2014 with the Accused wherein one Manjunath of J.P.Nagar is a witness and it is also true that, the complainant has not produced the 22 C.C.No.3470/2015 J said agreement before this court, but the complainant specifically stated that, the alleged agreement is not pertaining to the loan transaction in question but it is a different transaction and not for the loan dated: 20.1.2014. It is important to note here that, on careful perusal of the entire cross- examination of the complainant, the very suggestions made by the Accused to the complainant it appears that, the Accused had financial transaction with the complainant and the Accused borrowed the loan amounts for the purpose of improvement of his Maths Tutorials i.e Academy which is an admitted fact by the Accused, as evidenced by the document i.e. Ex.D.1 certified copy of the dairy produced by him wherein it is seen that, the Accused has borrowed loan amount from one Pradeep and others and same has been mentioned in the dairy, in such circumstances when the Accused himself admitted that, he had financial transaction with the complainant on various dates, the Accused cannot be permitted to dispute or deny the financial capacity of the complainant and the necessity of the Accused to borrow the loan amount from the complainant. The complainant /PW.1 in his 23 C.C.No.3470/2015 J cross-examination has specifically denied the suggestions made to him that, he had lent a loan of Rs.1 Lakhs to the Accused at 5% interest on 14.2.2009 and Accused has repaid the said loan to him in the month of June 2009 and Accused has availed a loan of Rs.2 Lakhs from the complainant on 13.3.2010 at 6% interest and he has repaid the said amount in the August 2010 and Accused has availed a loan of Rs.3 Lakhs from the complainant on 14.10.2010 and Rs.1 Lakh on 3.3.2011 and Rs.2 Lakhs on 25.5.2011 at 5% interest, therefore the above said suggestions makes it clear that, according to the Accused he used to borrow the loan amounts from the complainant on various dates that itself sufficient to show that, the Accused has admitted financial capacity of the complainant, now he cannot deny the source of income or financial capacity of the complainant. It is also an admitted fact that, the Accused has admitted the issuance of the cheque in question in favour of the complainant and also admitted his signature o the disputed cheque by contending that, at the time of borrowing the above said loan amount the Accused had collected the cheque in question as signed blank 24 C.C.No.3470/2015 J cheque but the complainant has denied the said suggestion. It is interesting to mention here that, it is true that, the complainant has not produced the document i.e agreement dated: 20.1.2014 and also not examined the person who is witness of the said document but the complainant specifically denied that, the said agreement pertains to the loan transaction in question, even for sake of discussion, if it is considered that, the complainant not produced the said agreement dated: 20.1.2014 and has not examined a witness i.e., Manjunath of J.P.Nagar that itself invalidates the transaction in question or only on the basis of non production of the document and non examination of the said witness whether the entire evidence of the complainant has to be discarded or not is to be taken into consideration. It is important to note here that, on careful perusal of the entire oral and documentary evidence produced by the complainant i.e Ex.P.1 to P.13 and admitted facts by the Accused, the complainant proved that the cheque in question belongs to the Accused i.e Ex.P.1 and signature found at Ex.P.1(a) is that of the signature of the Accused and also proved that, the cheque in 25 C.C.No.3470/2015 J question was presented within its validity period and it was dishonoured for the reason of "Account Closed" as per Ex.P.2 and thereafter the legal notice caused by him through RPAD to the Accused was presumed to be served on him and Accused has not given any reply to the legal notice, in such circumstances, it can be held that, the complainant has discharged his initial burden by complying the mandatory requirements as required U/s.138 of N.I. Act and initial presumptions are available in favour of the complainant U/s.118a and 139 of the N.I. Act. Consequently it is for the Accused to rebut the said presumptions available in favour of the complainant to show that, the cheque in question was not issued either to the complainant or towards discharge of any legally recoverable debt by producing cogent and convincible evidence but not mere suggestions or even by plausible explanation. In such circumstances, when the presumptions U/s.118 and 139 of N.I.Act are available to the complainant, even a presumption can be drawn to the extent of existence of legally recoverable debt or liability against the Accused unless and until the said presumptions are rebutted by the Accused, even in 26 C.C.No.3470/2015 J the absence of documents produced by the complainant with regard to loan transaction in question.
18. It is true that, the complainant has not produced documents except the cheque in question i.e., Ex.P1 to show that, he has lent an amount of Rs.6 Lakhs to the Accused and in turn the Accused has issued the Ex.P.1 cheque towards discharge of the said debt and has also not produced documents to show his source of income, but it is already held in the above that, the Accused himself admitted that, he has borrowed loan amounts from the complainant on various occasions, in such circumstances indirectly he has admitted the financial capacity of the complainant. Apart from that, it is relevant here to refer the decisions reported in 2001 AIR Karnataka HCR 2154 between 'M/s.Devi Tyres V/s.Navab Jan' and in 2011 ACD 1521 (KAR) between 'Smt. Usha Suresh V/s. Shashidharn', in 2010 SC 1898 between 'Rangappa Vs. Mohan' and 2011 ACD 1412 (KAR) between 'N.Hasainar Vs. M.Hasainar, S/o. Ibrahim'. The Hon'ble High Court of Karnataka in the above decision i.e., 2001 AIR 27 C.C.No.3470/2015 J Karnataka HCR 2154 at para No.6 was pleased to hold that issuance of cheque itself was adequate proof of existence of debt or liability. In another decision of Hon'ble Apex Court of India i.e. Hon'ble Three Judges Bench Decision reported in (2010) 11 SCC 441 in the case of Rangappa Vs. Sri. Mohan ., wherein the Hon'ble Apex Court held that "
A. Negotiable Instruments Act, 1881 - S.139 -
Presumption under - scope of - Held, presumption mandated by S. 139 includes a presumption that there exists a legally
enforceable debt or liability - However such presumption is rebuttable in nature - Criminal Trial - Proof - Presumptions - Generally. Further held that "Signature on the cheque was his, statutory presumption under S.139 comes into play and the same was not rebutted even with regard to the materials submitted by complainant Appellant not able to prove "lost cheque" theory - Apart from not raising a probable defence appellant was also not able to contest the existence of a legally enforceable debt or liability - hence, his conviction by High Court, held, proper. In another decision of Hon'ble 28 C.C.No.3470/2015 J Apex Court of India, reported in CRIMINAL APPEAL NO. 508 OF 2018 DT 15-03-2018 between ROHITBHAI JIVANLAL PATEL Vs STATE OF GUJARAT AND ANR held that "Negotiable Instruments Act facts like source of funds are not relevant if the Accused has not been able to rebut the presumption. It is further held that " When such a presumption is drawn, the facts relating to the want of documentary evidence in the form of receipts or accounts or want of evidence as regards source of funds were not of relevant consideration while examining if the Accused has been able to rebut the presumption or not". In another decision of Hon'ble Apex court of India decided in Crl.Appeal No.1545 of 2019 dt.17/10/2019 by the Hon'ble Apex Court of India in the case of Uttam Ram Vs. Devinder Singh Hudan and Anr. Wherein the Hon'ble Apex Court held that, "
Dishonor of cheque - Statutory presumption under - burden to prove - the burden is on the accused to rebut the presumption that the cheque was issued not for any debt or other liability - it is immaterial that the cheque may have been filled in by any person other than the 29 C.C.No.3470/2015 J drawer, if the cheque is duly signed by the drawer - even a blank cheque leaf, voluntarily signed and handed over by the accused which is towards some payment, would attract presumption U/s. 139 of NI Act - the accused is held guilty of dishonour of cheque for an offence U/s.s.138 of NI Act. It is also held that, " the accused has failed to lead any evidence to rebut the statutory presumption, a finding returned by both the Trial Court and High Court. Both courts not only erred in law but also committed perversity when the due amount is said to be disputed only on the account of discrepancy in the cartons, packing materials or the rate to determine the total liability as if the appellant was proving his debt before the civil court. Therefore it is presumed that, the cheque in question were drawn for consideration and the holder of the cheques received the same in existing debt". It is also held that, " the Trial court and the High Court proceeded as if, the appellant is to prove a debt before civil Court wherein, the plaintiff is required to prove his claim on the basis of evidence to be laid in 30 C.C.No.3470/2015 J support of his claim for the recovery of the amount due. A dishonour of cheque carries statutory presumption of consideration. The holder of cheque in due course is required to prove that, the cheque was issued by the Accused and that when the same presented , it was not honoured Since there is a statutory presumption of consideration, the burden is on the Accused to rebut the presumption that, the cheque was issued not for any debt or other liability ". It is also relevant here to refer the decision of Hon'ble High Court of Karnataka reported in ILR 2019 KAR 493 in the case of Sri.Yogesh Poojary Vs. Sri.K.Shankara Bhat, wherein the Hon'ble High Court held that, the presumption mandated by Sec.139 of N.I Act includes the presumption that, there existed a legally enforceable debt or liability, however such presumption is rebuttable in nature". In another decision of Hon'ble High Court of Karnataka in the case of Shri.V.R.Shresti Vs. Shri. Bhaskara.P. in Crl. Appeal No. 2109/2017 dated: 15.10.2019 wherein the Hon'ble High Court of Karnataka held that "the Accused has not given any reply to the 31 C.C.No.3470/2015 J notice and also in the cross-examination, he categorically admits that, the cheque has bounced on account of no sufficient fund in the bank account of the Accused. Mere non producing of the document before the court with regard to the source of income to advance a loan is not a ground to dismiss the complaint. The Accused ought to have rebutted the contention of the complainant by producing cogent evidence before the court and mere denial is not enough".
19. Therefore on careful reading of the principles of law laid down by the Hon'ble Apex Court of India and High Court of Karnataka in the above referred decisions makes it very clear that, once the holder in due course i.e. the complainant proved that, the cheque in question belongs to the drawer and signature appearing on the cheque is that of the drawer i.e., Accused and complied the mandatory requirements as required U/s.138 of N.I.Act, presumptions U/s.118a and 139 of N.I.Act indeed does extend to the existence of legally recoverable debt and when such presumption is drawn the facts relating to the want of documentary evidence in the form of receipts or accounts or want 32 C.C.No.3470/2015 J of evidence regarding source of funds were not of relevant unless the Accused rebutted the presumption available to the complainant as held by the Hon'ble Apex Court and High Court of Karnataka in the above decisions. In the present case also the complainant has complied mandatory requirements and has proved that, the Accused has issued the cheque in question in his favour and the Accused has admitted the cheque belongs to him and signature appearing on the cheque is that of his signature and even after service of the notice, the Accused has not given any reply or complied the terms of the notice, in such circumstances, presumptions have to be drawn towards existence of legally enforceable debt as per Sec.139 of N.I.Act.
20. Therefore, for the above said reasons the defence taken by the Accused that, the complainant has not produced the documents to show that, he was having source of income or funds to lend the loan amount to the Accused as on the date of lending of the loan amount and has not collected the documents for having advancing the loan amount of Rs.6 Lakhs to the Accused at the time of alleged 33 C.C.No.3470/2015 J lending of loan amount cannot be acceptable one. The defence taken by the Accused appears that, the complainant has to prove his claim by producing his evidence as if it is required for proving of his debt before the Civil Court, but same cannot be permissible in a proceedings initiated U/s.138 of N.I. Act, as held by the Hon'ble Apex court of India in the above referred decisions, therefore in view of the principles of law laid down in the above referred decisions it is presumed that, cheque in question was drawn for consideration as the Accused has admitted the cheque in question belongs to him and signature found on the cheque in question is also that of his signature. With due respect to the principles of law laid down in the decisions relied upon by the learned counsel for the Accused are not applicable to the defence of the Accused as the facts and circumstances of this case and facts and circumstances of the decisions relied upon by the learned counsel for the Accused are not one and the same.
21. It is also relevant here to mention that, the complainant has admitted in his cross-examination 34 C.C.No.3470/2015 J that, he have filed his I.T. returns in respect of Rs.3.5 Lakhs and he has paid the income tax generally in respect of all the income including the said loan and he has not produced the relevant documents. The learned counsel for the Accused argued that, the complainant though he has admitted that, he has mentioned the loan transaction in question in his I.T. Returns and no hindrance for him to produce the said document before the court inspite of it the complainant has not produced his I.T. Returns before the court that itself sufficient to hold that, the complainant was not having sufficient source of fund to lend the alleged loan amount to the Accused and has not advanced the loan amount on 20.1.2014 . It is true that, the complainant in his cross-examination admitted that, he has mentioned the Rs.3.5 Lakhs in his I.T returns and no hindrance for him to produce the same before the court but he has not produced before the court, but mere non production of the I.T. returns before the court that by itself invalidates the transaction or not is to be taken into consideration. In this regard, it is necessary here to refer the decision of our Hon'ble High court of Karnataka 35 C.C.No.3470/2015 J reported in 2019(1) Kar. L.R.185 in the case of Sri.Yogesh Poojary Vs. Sri.K.Shankara Bhat in the said case the Hon'ble High Court of Karnataka held that " Negotiable Instruments Act, 1881 - Sections 138 and 139 -Endorsement 'payment stopped by drawer' - The trial court in the instant case, merely considered a suggestion made from the Accused side in the cross- examination of PW-1 that the complainant was an income tax assessee and that he has not declared the alleged loan transaction in his returns and disbelieved the case of the complainant that too, ignoring that legal presumption under section 139 of the N.I. Act, was operating in favour of the complainant- For these reasons, it has to be held that the complainant has beyond reasonable doubt proved the guilt of the Accused punishable under Section 138 of the N.I. Act. As such, the impugned judgment of acquittal passed by the trial court deserves to be set aside and respondent/ Accused is liable to be convicted for the offence punishable under Section 138 of the N.I. Act. Hence in view of the principles of law laid 36 C.C.No.3470/2015 J down by the Hon'ble High court of Karnataka in the above referred decisions, in the present case also the complainant admitted that, he has not produced his I.T. Returns before the court, but as it is already held that, the complainant has discharged his primary burden by complying the mandatory provisions of Sec.138 of N.I. Act, therefore it is for the accused to rebut the presumption existing infavour of the complainant U/s.139 of Negotiable Instruments Act. Apart from that, the admissions of the complainant with regard to non production of I.T. Returns for the concerned year could not by itself draw an adverse inference and to hold that, there was no existence of legally enforceable debt or the presumption as envisaged U/s.139 of N.I.Act is successfully rebutted by the accused. In another decision of Hon'ble Madhya Pradesh High Court decided in C.R.R No.5263/2018 dated: 7.3.2019 in the case of Smt. Ragini Gupta Vs. Piyush Dutt Sharma Gwalior., wherein the Hon'ble High Court held that, mere non filing of income tax return would not automatically dislodge the source of income of the complainant and non payment of income tax is a matter between the revenue and 37 C.C.No.3470/2015 J assessee and if the assessee has not disclosed his income in the income tax return, then the income tax department is well within its right to reopen the assessment of income of the assessee and to take action as per provisions of Income Tax Act, however non filing of income tax return by itself would not mean that, the complainant had no source of income and thus no adverse inference can be drawn in this regard only because of absence of income tax return. Hence in view of the principles of law laid down by Hon'ble High Court of Madya Pradesh in the above said decision in the present case also though the complainant has admitted that, he has not produced his I.T. Returns before court, that itself would not automatically dislodge the source of income of the complainant. Therefore the admissions of the complainant which are elicited in her cross- examination are not helpful for the accused to prove his defence that, in view of non production of I.T.Returns before court that itself sufficient to hold that, the complainant has no source of income cannot be acceptable one.
22. It is also the specific defence of the 38 C.C.No.3470/2015 J Accused that, he had availed loan from the complainant on 13.3.2010 for Rs.2 Lakhs at the rate of 6% interest p.m. which was repaid to him in August 2010 and Rs.3 Lakhs on 14.10.2010, Rs.1 Lakh on 3.3.2011, and Rs.2 Lakhs on 25.5.2011 at 5% interest p.m. and during the said transaction the complainant had collected his two blank signed cheque as security to the said loans, out of which the cheque in question is also one of the cheque and same has been misused by the complainant and filed this false complaint. The learned counsel for the Accused has also argued that, the complainant in his cross-examination has admitted that, there is difference in ink as well as handwriting in the contents of Ex.P.1 and that, there was no impediment for sending to test for the same and complainant has not send the Ex.P.1 to test, therefore the complainant has misused the cheque in question and it creates the doubt. It is true that, the complainant admitted that, there is difference in the ink as well as in the handwriting between the signature and other contents of Ex.P.1 and has no objections to send the cheque in question to the expert opinion, if really the Accused had given signed 39 C.C.No.3470/2015 J blank cheque to the complainant during the year 2009-10 in respect of the alleged transaction as stated by him and same has been misused by the complainant, definitely the Accused would have made an efforts to send the Ex.P.1 to the expert for getting opinion but no such efforts have been made by the Accused , in such circumstances it can be held that, the cheque in question i.e Ex.P.1 was collected by the complainant from the Accused as blank signed cheque as alleged by the Accused and misused by the complainant. Even for sake of discussion, if the defence of the Accused is taken into consideration that, even in such circumstances also it cannot be held that, the contents of the subject cheque are not filled in by the Accused, unless and until the Accused proved his defence by producing cogent and convincible evidence and it cannot be also held that, the contents of the cheque have been filled in by the complainant. In this regard, it is a relevant here to refer a decision of Hon'ble High Court of Karnataka at Bengaluru in a case of Crl. Appeal No. 1664/2003 C/w. Crl.Apeepal No. 1663/2003 dated: 18.6.2008 in the case of R.Mallikarjuna Vs. H.R.Sadashivaiah 40 C.C.No.3470/2015 J wherein the Hon'ble High Court at para No.19 held that " But, the question is, whether that renders instrument unenforceable. In this regard, it must be observed that, this court similar circumstances in the case of S.R. Muralidar Vs. Ashok G.Y. reported in 3001 (4) KAR. LJ K. 122 referring to the provisions of Sections 20, 138, 139, and 140 of the Act and after interpreting alteration and filling up of the cheque observed thus : "The trial court has made much about the difference in ink. Admittedly, Accused cheque is issued bearing signature of the Accused. It is the contention of the defence that, blank cheques issued for the business transactions have been illegally converted as a subject matter to this case fastening false liability........ It is not objectionable or illegal in law to receive a inchoate negotiable instrument duly signed by the maker despite the material particulars are kept blank if done with an understanding and giving full authority to the payee to fill up the material contents as agreed upon. Such a course of action in law cannot vitiate the transaction nor can invalidate the 41 C.C.No.3470/2015 J negotiable instrument issued and such transaction fully begins the maker of the negotiable instrument to the extent it purports to declare........ The fact that, a document executed is inchoate with regard to some of the material particulars would not render such contract invalid nor make the instrument illegal or inadmissible. Voluntarily, if a person were to deliver an inchoate instrument authorizing the receiver to fill up the material contents as agreed upon, the cheque does not get tainted as in admissible nor it amounts to tampering with the material particulars...... In the present case there is no categorical defence version, it is only by conjunctures and surmises, a case is made out from the difference in ink between the signature of the cheque and the other handwritten contents. Hence, in view of the principles of law laid down by the Hon'ble High Court of Karnataka, the same were aptly applicable to the case on hand and the defence of the Accused cannot be acceptable one as the instrument i.e., cheque in question cannot be rendered unenforceable merely because the contents have 42 C.C.No.3470/2015 J been filled by different ink, as it would not render such instrument illegal or inadmissible, the complainant certainly can base action on it. It is also relevant here to refer another decision of Hon'ble Apex Court of India reported in AIR 2019 SC 2446 in the case of Birsingh Vs. Mukesh Kumar., wherein the Hon'ble apex Court held that, "presumption U/s.139 is presumption of law, distinguished from presumption of facts and also held that, presumptions are rules of evidence and do not conflict with presumption of innocence which requires prosecution to prove case against the Accused and also held that obligation on the prosecution may discharged with the help of presumptions of law and presumption of fact unless the accused adduces evidence showing reasonable plausibility of non existence of presumed fact." In the present case though the Accused has denied the contents of the cheque in question but he did not proved his defence or produced any documents or satisfactory evidence to rebut the presumptions as available U/s.139 of the N.I.Act, under such circumstances in view of the above principles of law, it can be 43 C.C.No.3470/2015 J presumed even on fact also that the complainant has proved his case by discharging his burden and complying the mandatory provisions. In the said decision the Hon'ble Apex court has also held that, "presumption as to legally enforceable debt is rebuttable, the signed blank cheque if voluntarily presented to payee towards payment payee may fill up amount and other particulars and it in itself would not invalidate cheque and onus would still be on the accused to prove that, cheque was not issued or discharge of debt or liability by adducing evidence." In another decision of Hon'ble Apex court of India decided in Crl.Appeal No.1545 of 2019 dt.17/10/2019 by the Hon'ble Apex Court of India in the case of Uttam Ram Vs. Devinder Singh Hudan and Anr. Wherein the Hon'ble Apex Court held that, "Dishonor of cheque - Statutory presumption under - burden to prove - the burden is on the accused to rebut the presumption that the cheque was issued not for any debt or other 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 44 C.C.No.3470/2015 J drawer - even a blank cheque leaf, voluntarily signed and handed over by the accused which is towards some payment, would attract presumption U/s. 139 of NI Act - the accused is held guilty of dishonour of cheque for an offence U/s.s.138 of NI Act. In such circumstances even if it is assumed that, the complainant admitted that, there is difference in the ink as well as in the handwriting between the signature and the other contents of the Ex. P.1, in such circumstances also in view of the principles of law laid down in the above decision that itself would not invalidates the cheque in question and it can be presumed that, the said cheque has been issued towards discharge of legally recoverable debt.
23. The Accused in order to substantiate his defence himself examined as DW.1. The Accused in his evidence has denied the loan transaction in question and issuance of the cheque i.e Ex.P.1 in favour of the complainant as claimed by the complainant in his complaint. The Accused /DW.1 further deposed that, he and complainant were classmates while studying BSc in Bengaluru in the 45 C.C.No.3470/2015 J year 1999 along with the complainant Mr. Ravi Kiran @ Kiran Kumar was also known to him and they were common friends and after BSc he pursued MSC in Mathematics , thereafter in the year 2005-06 he started a Tuition Center named as "Maths Academy" and initially he started with few students and as the word spread many students were enrolled due to which he needed more financial resources to hire more teachers and to pay salaries and to provide more infrastructures to students, for that purpose he had availed loan from many people including the complainant i.e., he availed a hand loan of Rs.1 Lakh on 14.2.2009 at 5% interest p.m. from the complainant and repaid the said amount in June 2009 and also availed loan of Rs.2 Lakhs on 13.3.2010 at 6% interest p.m. which was repaid in August 2010 and Rs.3 Lakhs on 14.10.2010, Rs.1 Lakh on 3.3.2011 and Rs.2 Lakh on 25.5.2011 at 5% interest p.m. and during the said transaction complainant had collected two blank signed cheques of him pertaining to the IDBI Bank account i.e. cheque bearing No.050607 and 050608 as security to the said loans out of which 050608 is the disputed cheque. The Accused/DW.1 also deposed 46 C.C.No.3470/2015 J that, he used to enter all the details regarding the loans received by him from various lenders including the complainant in a dairy and the said original dairy produced in C.C.No. 14181/2015 and he has produced certified copy of the same in this case. The Accused further deposed that, he suffered huge set back in his tuition business in the year 2014 and he could not bear the burden of paying 5% interest p.m. to the complainant and the complainant once again in the year 2014 took two blank signed cheques bearing Nos. 085833 and 070854 pertaining to IDBI bank account as security for the exorbitant interest and due to pressure on him by money lenders including the complainant he shifted his base to Mysore on September 2014 along with his family and since then he residing at Mysore. The Accused /DW.1 further deposed that, the complainant hatched a plan in conspiracy with Mr. Ravikumar @ Kiran Kumar to make unlawful and illegal gain to him and loss to him by misusing the above said cheques by way of filing three false cheque bounce cases against him in the name of complainant and others namely Mr. Hemanth Kumar and Mr. Mohan, he was acquitted on merits in the complaint filed in 47 C.C.No.3470/2015 J C.C.No.3468/2015 by Mr. Hemanth Kumar and the complaint filed by Mr. Ravi kiran @ Kiran Kumar in C.C. No. 6168/2015 is pending before this court and one more case got filed by the complainant through Mr. Mohan.S in C.C.No. 3467/2015 was dismissed for non prosecution by this court. The Accused /DW.1 further deposed that, the complainant by misusing the cheque in dispute has filed this false case against him and also filed false cases through Mr. Ravi Kiran @ Kiran Kumar in C.C.No.6168/2015 and through Mr.Mohan.S. in C.C.No.3467/2015 though he has not received any amount from the complainant as claimed by the complainant in this case.
24. In support of oral evidence of the Accused, he has produced the documents i.e., certified copy of Dairy marked as Ex.D.6 in C.C.No.14181/2015 as per Ex.D.1, certified copy of the Rent Agreement produced in C.C.No.14181/2015 as per Ex.D.2, certified copy of the Aadhar card produced in C.C.No.14181/2015 as per Ex.D.3, certified copy of the Order sheet in C.C.No.3467/2015 as per Ex.D.4, certified copy of the Private complaint in 48 C.C.No.3470/2015 J C.C.No.3467/2015 as per Ex.D.5, certified copy of the Vakalathnama in C.C.No.3467/2015 as per Ex.D.6, certified copy of the Order sheet in C.C.No.3468/2015 as per Ex.D.7, certified copy of the Private complaint in C.C.No.3468/2015 as per Ex.D.8, certified copy of the Vakalathnama in C.C.No.3468/2015 as per Ex.D.9.
25. It is relevant here to mention that, as per the oral and documentary evidence of the Accused , it is the specific defence of the Accused that, he started tuition center named as Maths Academy very few students and later many students were enrolled due to which he needed more financial resources for that, he availed loan from many people including the complainant during the year 1999 to 2009 -10 and has borrowed a loan of Rs.1 Lakh on 14.2.2009 at 5% interest p.m. and repaid the said amount in June 2009, Rs.2 Lakh at 6% interest p.m. on 13.3.2010 and repaid the said amount in August 2010 and Rs.3 Lakhs on 14.10.2010, Rs. 1 Lakh on 2.2.2011 and Rs.2 Lakhs on 25.5.2011 at 5% interest and at the time of said transaction the complainant had collected his two signed blank cheques out of the 49 C.C.No.3470/2015 J said cheques one of the cheque is disputed cheque of this case and though he has repaid the said loan amounts, complainant misused the said cheque by filign this false complaint. The Accused in order to substantiate his defence has produced the certified copy of the dairy alleged to have been recorded the loan amount borrowed from the complainant and others which is at Ex.D.1. The perusal of contents of Ex.D.1 though there is mentioning of names of the persons from whom the Accused borrowed alleged loan amounts and there is mentioning of amounts infront of the respective names of the persons but the complainant during the course of cross-examination of the Accused has not admitted the Ex.D.1 i.e .the dairy in which the loan amount advanced by him is recorded by the Accused , therefore the burden is on the Accused to prove that, the loan amounts borrowed from the complainant and same were repaid to the complainant and the complainant had collected his two signed blank cheques including the cheque in dispute towards security of the said loan amount. It is also seen from the Ex.D.1 that, though there is mentioning of name as Pradeep (Vicky) and in front of the said name the 50 C.C.No.3470/2015 J amounts mentioned and in the bracket also mentioned the rate of interest and cheques, agreement, R.C. book From 29-30 , Promissory note but it is nowhere mentioned that, the alleged loan amounts borrowed by the Accused have been repaid to the complainant either by way of cheques or by way of cash as defence taken by the Accused . According to him he has repaid the loan amounts to the complainant by way of cash but in the cross- examination the Accused has admitted that, there are no documents with him to show that, he has repaid the loan amounts to the complainant by way of cash, therefore when the Accused himself admitted that, there are no documents to show that he has repaid the alleged loan amount to the complainant, it cannot be held that, the Accused has borrowed the loan amounts and has repaid the said amounts as alleged by him in his defence. In addition to that, if really the Accused has repaid the alleged loan amount by way of cash, definitely he would have mentioned the same in the Ex.D.1 dairy itself when the Accused recorded the alleged borrowal of loan from the complainant and other people in Ex.D.1 definitely he would have recorded if 51 C.C.No.3470/2015 J the repayment of the loan amount alleged to have been paid either to the complainant or the other persons mentioned in the Ex.D.1, but no such recitals are found in Ex.D.1 regarding alleged repayment made by the Accused in favour of the complainant. Even the Accused has not stated anything why or for what reason he has not recorded in Ex.D.1 in respect of the alleged repayment, in such circumstances an adverse inference can be drawn against the Accused that, he has failed to substantiate his defence that, he has repaid the alleged loan amount borrowed from the complainant. It is also important to note here that, according to the Accused during the transaction from the year 2009-10 the complainant had collected two blank signed cheques of him pertaining to IDBI bank account i.e. during the above said financial transaction and out of the said two cheques the disputed cheque in question is also one of the cheque and same has been misused by the complainant inspite of repayment made by him in respect of the loan amount borrowed from the complainant. It is interesting to mention here that, if really the complainant had collected two blank 52 C.C.No.3470/2015 J signed cheques of the Accused i.e. cheque bearing No. 050607 and 050608 i.e., the disputed cheque in question as a security towards the aforesaid loans, definitely the cheque numbers should have been recorded in Ex.D.1 dairy but there is no mentioning of cheque numbers in the Ex.D.1 dairy, in such circumstances it is very difficulty to accept the defence of the Accused that, during the above said loan transaction the complainant had collected his two blank signed cheques pertaining to IDBI bank account and out of them one of the cheque is disputed cheque in question . It is also the defence of the Accused that, the complainant during the year 2014 had collected two more blank signed cheques bearing No. 085833 and 070854 belonging to his IDBI Bank account as security towards the exorbitant interest, if really the complainant had collected two more blank signed cheques from the Accused as stated above towards the interest, definitely the said fact would have been shown or recorded in Ex.D.1 dairy but no such rectal is found in Ex.D.1 even the Accused has not stated the reasons for non recording or mentioning of cheque numbers alleged to have been collected by the 53 C.C.No.3470/2015 J complainant either towards loan amount or towards the alleged interest, in such circumstances the defence of the Accused appears to be mere denial of the claim made by the complainant and in order to avoid repayment of the loan amount in question and liability in question, the Accused has taken such defence which cannot be acceptable because the Accused has miserably failed to prove his defence by producing cogent and convincible evidence.
26. It is relevant here to mention that, according to the defence of the Accused that, the complainant had collected two blank signed cheques of him pertaining to IDBI Bank account i.e 050607 and 050608 i.e the cheque in dispute as a security towards the loan amount borrowed during the year 2009 -10 and has also collected two more blank signed cheques bearing No. 085833 and 070854 towards exorbitant interest and though he has repaid the loan amount along with interest inspite of it, the complainant has misused the above said cheques by filing this complaint and also filing the complaints through one Ravikiram @ Kiran Kumar in C.C.No.6168/2015 and through Mohan.S. 54 C.C.No.3470/2015 J in C.C.No.3467/2015 and also by filing this case. It is already held in the above that, except the Ex.D.1 dairy the complainant has not produced any other documents to show that he has repaid the loan amounts borrowed from the complainant and has not produced any document to show that, complainant had collected his blank signed cheques towards security in respect of the loan transaction of the year 2009-10. Apart from that, the Accused has clearly admitted in his cross-examination that, he has not issued any legal notice through his advocate or filed any police complaint before the police or private complaint before the court against the complainant alleging that, even after repayment of the loan amount the complainant did not returned his cheques and has misused the same by filing this complaint, in such circumstances it can be held that, if really the Accused has repaid the loan amount along with interest to the complainant as alleged by him and even after his repayment the complainant did not returned the cheques, definitely he would have initiated legal action against the complainant or Ravikiran @ Kiran Kumar or Mr. Mohan.S in respect of alleged misusing of his 55 C.C.No.3470/2015 J signed blank cheques issued towards security of the loan amounts. If really the complainant by colluding with the said Ravikiran @ Kiran Kumar or Mr. Mohan.S. have misused the blank signed cheques of the Accused which were alleged to have been given towards security of the loan amounts, the accused would have made an efforts to get return of the said blank cheques either from the complainant or from Ravi kiran @ Kiran Kumar or Mr. Mohan.S. by issuing legal notice through the advocate or by filing police complaint before the police or before the courts of law, admittedly he has not made such efforts, in such circumstances, an adverse inference can be drawn against the Accused that, in order to overcome the liability in question the Accused has taken such defence and said defence cannot be acceptable one. In this regard, it is relevant here to refer the decision of Hon'ble Apex Court of India reported in AIR 2018 SC 3601 in a case of T.P.Murugan (dead) Thr. Lrs.V. Bhojan Vs. Posa Nandi, rep. Thr. Lrs. PA holder, T.P. Murugan V. Bhojan, wherein the Hon'ble apex Court held that "Negotiable Instruments Act (26 of 1881) Ss.118, 138, 139 - Dishonour of cheque - Presumption 56 C.C.No.3470/2015 J as to enforceable debt- cheques allegedly issued by accused towards repayment of debt- Defence of accused that 10 cheques issued towards repayment of loan back in 1995 - behavior of accused in allegedly issuing 10 blank cheques back in 1995 and never asking their return for 7 years, unnatural - Accused admitting his signature on cheques and pronote, presumption under S.139 would operate against him - Complainant proving existence of legally enforceable debt and issuance of cheques towards discharge of such debt- Conviction, Proper." Hence by applying the above principles of law to the present facts of the case in the present case, the Accused has not produced any document to prove his defence, under such circumstances, it can be held that, the accused has not made any efforts to get return of the cheque in question or other cheques alleged to have been collected by the complainant as a security towards the alleged loan amounts borrowed by him and the said cheques have been misused by the complainant by colluding with Mr.Ravi kiran @ Kiran Kumar or Mr. Mohan.S, under such circumstances, the said unnatural 57 C.C.No.3470/2015 J conduct of the accused in non taking of action may leads to draw an adverse inference against the accused that, the cheque in question issued by the accused towards discharge of the liability and presumption U/s.139 of N.I. Act would operate against him, as he has admitted the signature and cheque in questions belongs to him.
27. It is also the specific defence of the Accused that, the complainant had collected his two cheques including the cheque in question as a security at the time of financial transaction with him during the year 2009-10 and even after repayment made by him the complainant has misused the cheque in question and has filed this false complaint against him in order to make unlawful gain. But as it is already held in the above that, the Accused has miserably failed to prove that, he has borrowed the loan amount from the complainant and at the time of advancing the loan the complainant has collected his blank cheques including the cheque in dispute and he has repaid the loan amount as alleged by him, in such circumstances the defence taken by the Accused cannot be acceptable one, on the contrary 58 C.C.No.3470/2015 J the fact of receiving of loan amount and issuance of cheque in favour of the complainant remained as it is, in such circumstances also it can be held that, the cheque in question has been issued by the Accused towards s discharge of the loan transaction in question as the Accused has miserably failed to prove that, the alleged transaction between him and the complainant. In this regard, it is also relevant here to refer the decisions of Hon'ble High Court of Karnataka reported in 2015 (1) KCCR 235 in the case of Lale Patel Vs. Sharanabasappa., wherein the Hon'ble High Court held that, NEGOTIABLE ISNTRUCEMTNS ACT, 1881- section 138 - Dishonour of cheque for insufficiency of funds - Plea of accused that he had given a blank cheque signed as security for a transaction and complainant filled up the contents and denied existence of any debt or loan - Conviction by Trial court - Affirmed by Appellate Court - Revision against. Hence the Hon'ble High Court of Karnataka in the said decision clearly held that, if the Accused has taken defence that, the a blank signed cheque has been issued as a security for transaction and the complainant filled up the 59 C.C.No.3470/2015 J contents and the accused denied the existence of debt or loan in such circumstances it is for the accused to prove his defence by producing cogent and convincible evidence, if the Accused has not proved the same in such circumstances, it cannot be held that, the cheque in question was issued for the purpose of security in connection with the transaction. In the present case also the Accused has failed to establish his defence that, the cheque in question was collected by the complainant in respect of the alleged loan transaction and inspite of repayment of the said loan amounts the cheque in question was not return to him and misused by the complainant, under such circumstances the cheque so issued cannot be considered as the one issued as stated by the accused in his defense and the defence taken by the Accused is untenable one. In another decision reported in 2015 (4) KCCR 2881 (SC) in the case of T. Vasanthakumar Vs. Vijayakumari wherein the Hon'ble Apex court held that "NEGOTIABLE INSTRUMENT Act, 1881- Section s138 and 139 - acquittal - If justified- Accused not disputing issuance of cheque and his signature eon it- Plea that it was issued long 60 C.C.No.3470/2015 J back as security and that loan amount was repaid- Not supported by any evidence - Fact that date was printed, would not lend any evidence to case of accused- Acquittal not proper. Hence in the present case also it is the main defence of the Accused that the cheque in dispute was alleged to have been collected by the complainant towards loan transaction and the said loan amounts were repaid to the complainant but the cheque in question were not returned to him but in this regard the accused has not produced documents or proof in such circumstances by applying the principles of law laid down in the above decision the defence of the Accused cannot be acceptable one. Therefore for the above said reasons the contents of the written arguments submitted by the learned counsel for the defence cannot be acceptable one or not sustainable.
28. It is also important to note here that, the Accused has not denied or disputed that the cheque in question as well as the signature therein do belong to him and he has failed to prove his defence and how the cheque in question has come to the 61 C.C.No.3470/2015 J possession of the Complainant, this would also give rise to an adverse inference against him. This preposition of law finds support from the decisions of Hon'ble High Court of Karnataka reported in 2010(1) KCCR 176 in the case of "Siddappa Vs. Manjappa". In another decision of Hon'ble Apex court of India decided in Crl.A.No.664 of 2012 dated: 19.9.2019 in the case of "M.Abbas Haji Vs. T.M.Chennakeshava" held that, " the Accused has to explain how the cheque entered into the hands of complainant". Therefore for the above said reasons the defense taken by the accused cannot be acceptable one and accused has miserably failed to rebut the presumption available in favour of the complainant by adducing cogent and convincible evidence.
29. Therefore considering all these aspects of the case and totality of the circumstances and on careful and meticulous appreciation of evidence adduced on behalf of the complainant and accused the complainant has successfully established beyond all reasonable doubt that, he has lent an amount of Rs.6 Lakhs to the Accused and in turn the Accused 62 C.C.No.3470/2015 J has issued the Ex.P.1 cheque in question in his favour towards discharge of the said loan amount and thereafter the complainant has presented the said cheque through his banker and same was returned dishonoured with an endorsement of "Account Closed" and thereafter he got issued legal notice to the accused and the said notice was served on him, inspite of it, the Accused did not paid the cheque amount, hence the complainant filed the present complaint against the accused. On the other hand, the accused has failed to rebut the presumption available infavour of the complainant with regard to the existence of legally recoverable debt under Ex.P.1 Cheque. Therefore accused has committed an offence punishable U/s.138 of N.I. Act, accordingly for the above said reasons this point is answered in the Affirmative.
30. Point No.2: Negotiable Instrument Act was enacted to bring credibility to the cheque and the very purpose of enactment is to promote the use of negotiable instrument, while to discourage the issuance of cheques without having sufficient funds in their accounts. Such being the case the intention 63 C.C.No.3470/2015 J of the legislature is that, complainant be suitable compensated while accused be punished for his act. Hence while awarding the compensation the said fact is to be kept in mind and suitable compensation is awarded to the complainant certainly it will not cause injustice to the accused, accordingly the complainant is entitled for the compensation as ordered by the court and for the said reasons, it is just and proper to pass the following :-
ORDER Acting U/sec.255(2) of Cr.P.C.
the accused is convicted for the offence punishable U/sec.138 of N.I.Act.
The accused is sentenced to pay a fine of Rs.6,15,000/= (Rupees Six Lakhs and Fifteen Thousand only) within one month from the date of order, in default he shall under go simple imprisonment for a period of (3) three months for the offence punishable U/sec.138 of N.I.Act.
Further acting U/sec.357(1) of Cr.P.C. out of the fine amount on recovery, a sum of Rs.6,10,000/= (Rupees Six Lakhs and Ten Thousand only) shall be paid as 64 C.C.No.3470/2015 J compensation to the complainant.
Further acting U/sec.357(1)(a) of Cr.P.C. out of fine amount on recovery a sum of Rs.5,000/= (Rupees Five Thousand only) shall be defrayed as prosecution expenses to the state.
The Bail bond of the Accused stands cancelled.
Office is directed to furnish free certified copy of this judgment to the Accused incompliance of Sec.363(1) of Cr.P.C.
(Directly dictated to the stenographer online, printout taken by her, verified, corrected and then pronounced by me in the open Court on this the 22nd June 2020).
(SRI.S.B. HANDRAL), XVI ACMM, Bengaluru City.
ANNEXURE
1. List of witness/s examined on behalf of the Complainant:-
P.W.1 : Sri. Pradeep Kumar B.R;
2. List of documents exhibited on behalf of the Complainant:-
Ex.P-1 : Original Cheque;
Ex.P-1(a) : Signature of the Accused;
Ex.P.2 : Bank Memo;
Ex.P.3 : Office copy of the Legal Notice;
Ex.P.4 & P.5 : Postal Receipts;
65 C.C.No.3470/2015 J
Ex.P.6 & P.7 : Returned Legal notices; Ex.P.8 & P.9 : Postal envelopes;
Ex.P.10 & 11 : Postal receipts;
Ex.12 & 13 : Postal acknowledgements.
3. List of witness/s examined on behalf of the Accused:-
DW.1 : A.Krishna Murthy;
4. List of documents exhibited on behalf of the Accused:-
Ex.D.1 : certified copy of Dairy marked as Ex.D.6 in C.C.No.14181/2015;
Ex.D.2 : certified copy of the Rent Agreement produced in C.C.No.14181/2015;
Ex.D.3 : certified copy of the Aadhar card produced in C.C.No.14181/2015;
Ex.D.4 : certified copy of the Order sheet in C.C.No.3467/2015;
Ex.D.5 : certified copy of the Private complaint in C.C.No.3467/2015;
Ex.D.6 : certified copy of the Vakalathnama in C.C.No.3467/2015;
Ex.D.7 : certified copy of the Order sheet in C.C.No.3468/2015;
Ex.D.8 : certified copy of the Private complaint in C.C.No.3468/2015;
Ex.D.9 : certified copy of the Vakalathnama in C.C.No.3468/2015 (SRI.S.B.HANDRAL), XVI ACMM, Bengaluru City.66 C.C.No.3470/2015 J
22.6.2020 Counsel for complainant and Accused are called out, counsel for the complainant absent and counsel for the Accused is present.
Judgment pronounced in the open court vide separate order.
ORDER Acting U/sec.255(2) of Cr.P.C. the accused is convicted for the offence punishable U/sec.138 of N.I.Act.
The accused is sentenced to pay a fine of Rs.6,15,000/= (Rupees Six Lakhs and Fifteen Thousand only) within one month from the date of order, in default he shall under go simple imprisonment for a period of (3) three months for the offence punishable U/sec.138 of N.I.Act.
Further acting U/sec.357(1) of Cr.P.C. out of the fine amount on recovery, a sum of Rs.6,10,000/= (Rupees Six Lakhs and Ten Thousand only) shall be paid as compensation to the complainant.
Further acting U/sec.357(1)(a) of Cr.P.C. out of fine amount on recovery a sum of Rs.5,000/= (Rupees Five Thousand only) shall be defrayed as prosecution expenses to the state.
The Bail bond of the Accused 67 C.C.No.3470/2015 J stands cancelled.
Office is directed to furnish free certified copy of this judgment to the Accused incompliance of Sec.363(1) of Cr.P.C.
XVI ACMM, B'luru.