Bangalore District Court
Narayanaswamy B.G vs Mysore Sales International Ltd on 17 January, 2019
IN THE COURT OF LXV ADDL CITY CIVIL AND SESSIONS
JUDGE; BANGALORE CITY
PRESENT
SRI. SUBHASH SANKAD
B.A., LL.M.
LXV Addl. City Civil & Sessions Judge,
Bengaluru.
Dated this the 17th day of January, 2019
CRL.A. No.312/2016
APPELLANT/S:- Narayanaswamy B.G.,
Aged about 46 years,
R/at No.2, 4th Cross,
Priyadharshini Layout,
Chikkadevasandra,
K.R. Puram,
Bangalore - 560 036.
(By Sri. ER, Advocate)
V/s.
RESPONDENT/S:- Mysore Sales International Ltd.,
Chit Funds Division,
Having its registered
office at MSIL House,
No.36, Cunningham Road,
Bengaluru - 52.
Rep. by its authorized signatory
Smt. Usha Bushan.
(By Sri. BSJ, Advocate)
* * * *
2 Crl.A.No.312/2016
JUDGMENT
The present appeal is filed by the appellant/accused under section 374(3) of Cr.P.C. challenging the order dated 08.02.2016 in C.C.No.28622/2014 passed by the learned XXVII Additional Chief Metropolitan Magistrate, Bengaluru.
2. The appellant is the accused and the respondent is the complainant before the trial Court, for the sake of convenience parties are referred by their ranks before the trial Court.
3. The brief facts of the case are as follows:-
The complainant is a company incorporated under the provisions of Companies Act, 1956, doing its chit fund business under the Chit Funds Act. The accused has become chit subscriber of the complainant, and he bid the chit and prize money was paid to him. Though, he was duty bound to pay the monthly installments, he did not remit the monthly installments and there is a due of Rs.14,66,423/- along with interest and other charges in respect of chit. It is further stated that, on repeated requests and demands made by the complainant, the accused had issued cheque bearing No.246852 dated 20.08.2014 for a sum of Rs.14,66,423/- drawn on Vijaya Bank, K.R.Puram, 3 Crl.A.No.312/2016 Bengaluru. The complainant's company had presented the said cheque for encashment in Vijaya Bank, Cunningham Road, Bangalore and on 27.08.2014 the said cheque was returned with an endorsement 'Funds Insufficient'. Thereafter, the complainant's company having no other option got issued the legal notice to the accused on 08.09.2014 through RPAD calling upon the accused to pay the cheque amount. The accused with dishonest intention and to cheat the complainant's company issued the cheque in question knowing without having sufficient funds in his account and thereby the accused has committed an offence punishable under section 138 of Negotiable Instrument Act. Hence, the complainant's company filed the complaint before the trial court.
4. After presentation of complaint, the trial court took cognizance of offence, recorded the sworn statement and ordered for issuance of summons to accused. The accused appeared through his counsel and defended the case. After hearing the accused, the trial court recorded the plea of accusation. The accused pleaded not guilty of the accusation levelled against him and claimed to be tried. Hence, the case was posted for trial.
4 Crl.A.No.312/2016
5. To prove its case, the complainant's company examined one Mr. Chandrashekar. K. as PW1 and got marked the documents as Exs.P1 to 14. After completion of the evidence, the trial court examined the accused as required by Section 313 of Cr.P.C. The accused denied the incrementing evidence. However, the accused himself was examined as DW1 and got marked the documents as Exs.D1 to 5. After completion of the trial, the matter was posted for arguments. After hearing the arguments on both the sides, the trial court passed the judgment convicting the accused and sentenced him to pay a fine of Rs.14,66,423/- with interest at 9% per annum from the date of cheque till payment of the entire amount.
6. Being aggrieved by the judgment passed by the learned Magistrate, the appellant has preferred the present appeal on the following grounds:-
1. The judgment of conviction passed by the trial court is bad in law and against the principles of natural justice.
2. The trial court without considering the chit agreement, has blindly passed the judgment by sentencing the appellant.5 Crl.A.No.312/2016
3. The respondent has filed a case No.31/MSIL/DL-49/36/2015-16 before the Co-operative Societies Director, MSIL House, Cunningham Road, Bengaluru, on the same transaction with the appellant for the recovery of a sum of Rs.15,51,950/-. In this case, the appellant has been served with notice and appearing before the Authority and the same is pending adjudication. Hence, the respondent with an intention to get wrongful gain from the appellant has filed a criminal case and also the aforesaid case.
Hence, the judgment of the criminal case is liable to be set aside in limine.
4. There is a chit agreement between the appellant and the respondent and there was an arbitration clause. The respondent instead of approaching the sole arbitrator invoking the Arbitration and Conciliation Act, has filed the complaint by misguiding the court.
7. After registering the appeal, this court ordered for issuance of notice to the complainant. The complainant appeared through his counsel. The lower court records were secured. After receipt of the LCR the appeal was posted for arguments. Several times the case was posted for arguments. Finally the case was listed on 11.01.2019 for argument as last 6 Crl.A.No.312/2016 chance. On this day also absolutely there was no representation from either side. Inspite of providing sufficient opportunities, the appellant side argument is not addressed.
8. I have carefully gone through the lower court records, the impugned judgment of conviction and the grounds urged in the appeal memo.
9. In the light of the contention and grounds urged in the appeal memo. The following points arise for my consideration:-
1. Whether the impugned judgment of conviction is opposed to the settled principles of law, facts and probabilities of the case?
2. Whether the Learned Magistrate erred in not properly appreciating the oral and documentary evidence available on record in proper perspective.
3. Whether the appellant has made out any grounds to interfere in the impugned judgment of conviction and sentence?
4. What Order ?
10. My findings on the above points are:-
Point No.1 :- In the Negative
Point No.2 :- In the Negative
point no.3 :- In the Negative
Point No.4 : As per the final order
for the following :-
7 Crl.A.No.312/2016
REASONS
11. Points No.1 and 2:- These points are taken together for discussion for the sake of convenience and to avoid repetition of facts.
12. The case of the complainant is that, it is incorporated company under the provisions of Companies Act, 1956, doing its chit fund business under the Chit Funds Act. The accused has become chit subscriber of the complainant, and he bid the chit and prize money was paid to him. Though, he was duty bound to pay the monthly installments, he did not remit the monthly installments and there is a due of Rs.14,66,423/- along with interest and other charges in respect of chit. It is further stated that, on repeated requests and demands made by the complainant, the accused had issued cheque bearing No.246852 dated 20.08.2014 for a sum of Rs.14,66,423/- drawn on Vijaya Bank, K.R.Puram, Bengaluru. The complainant's company had presented the said cheque for encashment in Vijaya Bank, Cunningham Road, Bangalore and on 27.08.2014 the said cheque was returned with an endorsement 'Funds Insufficient'.
8 Crl.A.No.312/2016
13. On the receipt of the bank endorsements as 'Funds Insufficient'. Having left with no other option the complainant's company got issued a legal notice to the accused on 08.09.2014 through RPAD calling upon him to discharge the chit amount of Rs.14,66,423/-. Even after the stipulated period the accused did not pay the amount paid by the complainant's company. The accused knowing fully well that the cheque will not be honored and he issued the cheque with dishonest intention to cheat the complainant and thereby committed an offence punishable under section 138 of Negotiable Instrument Act.
14. The trial court after recording the sworn statement took cognizance of the offence and issued notice to the accused. The accused appeared through his counsel and contested the matter. The learned Magistrate convicted the accused and sentenced him to pay fine of Rs.14,66,423/- with interest at 9% per annum from the date of cheque till pay of the entire amount. Being aggrieved by the judgment of conviction, the present appeal is filed.
9 Crl.A.No.312/2016
15. After careful perusal of the lower court records, impugned judgment of conviction and the contention raised and the grounds urged by the appellant in the appeal memo, I proceed to answer the points in controversy.
16. The burden is on the complainant to prove that the cheque in question was issued towards the discharge of legally recoverable debt or liability. In this regard the complainant Sri. Chandrashekar. K, authorized signatory was examined as PW1. In his evidence, he has reiterated the facts narrated in the complaint and got marked the documents as Exs.P1 to14. Exs.P1 and 2 are the letters of authority, Ex.P3 is the cheque, Ex.P4 is the counter slip, Ex.P5 is the bank endorsement, Ex.P6 is the notice, Ex.P7 is the postal receipt, Ex.P8 is the postal acknowledgment, Ex.P9 is the Memorandum of mortgage, Ex.P10 is the Chit payment voucher, Ex.P11 is the Minutes book, Ex.P12 is the letter and Exs.P13 and 14 are the Chit subscriber personal ledger. I have gone through all the documents produced by the complainant. The documents produced by the complainant show that the accused had issued the cheque towards the repayment of the chit amount i.e., discharge of his debt.
10 Crl.A.No.312/2016
17. Now coming to the provisions of law, Sec.138 of N.I.Act has been enacted to provide stability to credibility to the financial transactions. The Main ingredients of the Sec.138 of N.I.Act as follows:
(1) Drawing up of cheque by the accused towards payment of an amount of money for the discharge, in whole or in part or any debt or any other liability.
(2) Return of the cheque by the bank as unpaid. (3) The drawer of cheque fails to make the payment of the said amount of money within 15 days of the receipt of the notice under the proviso(b) to Sec.138 of N.I.Act.
18. The explanation appended to the section provides that, the 'debt or other liability' for the purpose of this Section means a legally enforceable debt or other liability.
19. Apart from this, Sec.139 of N.I.Act lays down a presumption in favour of the holder of cheque in the following terms.
"It shall be presumed, unless the contrary is proved, that:-
The holder of a cheque received the cheque, of the nature 11 Crl.A.No.312/2016 referred to in Sec.138 for the discharge in whole or in part, of any debt or other liability."
20. Also, Sec.118 N.I.Act states:- "Until the contrary is proved, the following presumptions shall be made:-
(a) That every negotiable instruments was made or drawn for consideration and that every such instrument, when it has been accepted indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration".
21. On careful perusal of Sec.139 of N.I.Act r/w Sec.118 N.I.Act, there is a presumption in favour of the complainant that, the cheque was issued towards discharge of legally enforceable debt or liability, the complainant has discharged his initial burden. Hence, the presumption goes in favour of the complainant
22. The burden is now upon the accused to rebut the presumption available to the complainant. The accused himself was examined as DW.1. In his evidence he has stated that he had bid the chit amount and the respondent had paid Rs.6,35,000/- only. He has further stated that while paying the prize amount had obtained blank signed cheque towards security. 12 Crl.A.No.312/2016 Thereafter, the complainant has misused the cheque even though he has paid the entire amount. However, he has admitted his signature and issuance of the cheque. In this regard, he has also relied upon the documents i.e., Ex.D1 - letter, Exs.D2 and 3 - statement of accounts, Ex.D4 - reply notice and Ex.D5 - chit agreement. The careful perusal of the evidence of DW1 it reveals that he has admitted his signature and issuance of the cheque and the defense taken by the accused is not a probable one and the same is not supported by any cogent and valid documentary or oral evidence. After due consideration of the oral and documentary evidence of the accused, there is no sufficient reasons and evidence to believe the version of the accused. The oral and documentary evidence are not sufficient to rebut the presumption available to the complainant. Hence, I am of the view that the accused has failed to prove his defense.
23. In the light of the aforesaid reason, I am of the opinion that, the contention raised by the appellant in his appeal are not supported by any cogent and valid documentary or oral evidence and he has failed to rebut the presumption available to the complainant. Hence, I am of the opinion that the trail court has rightly observed that the accused had issued cheque in question 13 Crl.A.No.312/2016 to discharge his legally enforceable debt i.e., chit amount taken by the accused. Hence, on careful perusal of the lower court records and the impugned judgment of conviction, I am of the opinion that the trial court has rightly passed the judgment of conviction. The impugned judgment is in accordance with the settled principle of law and facts of the case. There is no error in the judgment passed by the learned Magistrate and no grounds are made out by the appellant to interfere with the impugned judgment of conviction. Accordingly, points No.1 and 2 are answered in the 'Negative'.
24. Point No.3:- Now coming to the sentence part. The trial court has imposed sentence of Rs.14,66,423/- with interest at 9% per annum from the date of cheque till payment of the entire amount. Out of which Rs.14,00,000/- is ordered to be paid as compensation to the complainant and Rs.66,423/- is remitted to the state exchequer. Hence, I am of the opinion that, judgment of conviction and sentence passed by the trial court does not suffer from any irregularity and it does not call for any interference by this court. Accordingly, I answer point No.1 to 3 in the 'Negative.' 14 Crl.A.No.312/2016
25. Point No.4:- In view of my findings on point No.1 to 3, I proceed to pass the following:-
ORDER The appeal filed by appellant U/sec.374(3) of Code of Criminal Procedure is hereby dismissed.
The impugned judgment of conviction
passed by the XXVII Additional Chief
Metropolitan Magistrate, Bangalore, in
CC.No.28622/2014 dated 08.02.2016 is
hereby confirmed.
Send a copy of this judgment to the
lower Court along with LCR forthwith.
(Directly dictated to stenographer on computer, typed by her and then pronounced in open Court on the 17th day of January, 2019) (SUBHASH SANKAD) LXV Addl. City Civil & Sessions Judge, Bengaluru.