Bangalore District Court
M/S Qualitech Precision Industries vs M/S Sanmathi Precision Engineering Ltd on 16 July, 2024
KABC030958052021
IN THE COURT OF XX ADDL.CHIEF JUDICIAL
MAGISTRATE AT BENGALURU CITY
PRESENT: BHOLA PANDIT,
B.Com.,LL.M.,
C/c XX ADDL.C.J.M.
Bengaluru.
Dated this the 16th day of July 2024
C.C.No. 37041/ 2021
Complainant : M/s.Qualitech Precision Industries,
Situated at plot 473, D5,
13th Cross, 4th Phase,
PIA, Peenya,
Bengaluru - 560 058
Represented bt its Proprietor
Mr.Ananth N M
Aged about 44 years
{ By Sri.B.Kumara - Adv. }
Vs.
M/s. Sanmathi Precision Engineering Ltd.,
Accused : Plot No.111, Sector A,
Sri. Lakshmi Co-operative Industrial Estate,
Hatakanangale, Kolhapur,
Maharastra,
Represented by its Managing Director /
Authorized Signatory,
2 C.C.No. 37041 / 2021
Mr.Shital Katakale
Major in age
{ By Sri.K A. Patil -Advocate }
Offence complained : U/S. 138 of N.I. Act.,
Plea of accused : Pleaded not guilty
Final Order : Accused is Convicted
Date of Order : 16.07.2024
JUDGMENT
The present complaint is filed under section 2(d) read with section 200 of code of criminal procedure against the accused seeking to punish him for the offence punishable under section 138 of the Negotiable Instruments Act ( in short referred as "N.I. Act").
02. The factual matrix of the complaint is summarized as under;
3 C.C.No. 37041 / 2021
It is alleged in the complaint that, the accused approached Complainant for purchase of used duplex milling machine. This machine is exclusively used fo crank case as per the the Complainant instruction. It is agreed between the Complainant and accused to sell the full set at sum of Rs.6,75,000/- plus GST. The Complainant dispatched the same by accused transport Sunpro Logistics Pvt. Ltd. On 24.08.2021. The Complainant raised GST Invoice of Rs.7,96,500/-. The accused confirmed to pay Rs.4,00,000/- by RTGS to the Complainant and for balance amount of Rs.3,96,400/- the accused had issued cheque bearing No.500721 dated 25.08.2021 drawn on Rajarambapu Sahakari Bank Ltd. Kolhapur for Rs.3,96,400/-. When the complainant presented the said cheque for encashment, the said cheque was returned with an endorsement "Item Failed at Par Validation" on 27.08.2021. Thereafter, complainant got issued legal notice on 09.09.2021 to accused through RPAD. The notice sent to accused was duly served on the accused on 21.09.2021. In-spite of that, accused has not 4 C.C.No. 37041 / 2021 paid the cheque amount. Accordingly, this complaint is filed within time and has sought to convict the accused by granting compensation under section 357 of Code of Criminal Procedure double of the cheque amount.
03. On presentation of the complaint and after verification of the averments of the complaint as well as the annexed documents, this court took the cognizance for the offence punishable under section 138 of NI Act. As per the verdicts of the Hon'ble Apex court in the case of Indian Bank Association and others V/s Union of India and others, the sworn statement of the complainant has been recorded by way of examination-in-chief as PW.1 and got marked in all 5 documents at Ex.P.1 to 5. After scrutinizing the oral and documentary evidence of the complainant prima- facie case is made out for the trial. Accordingly, by registering criminal case in Register No. III, summons has been issued against the accused.
5 C.C.No. 37041 / 2021
04. In pursuance of the summons, the accused has appeared before the court through her counsel and filed bail application under section 436 of Code of Criminal Procedure, the accused has been enlarged on bail. The accusation has been read over to the accused, she pleaded not guilty and wants to put forth defense. On filing application under section 145(2) of NI Act, accused was permitted to cross examine PW.1. In spite of granting sufficient time, the accused not cross examined PW.1 and not adduced the defense evidence. Even the accused deliberately avoided to appear before the court to cause obstructions to the proceedings. Therefore, in view of guidelines in the case of Indian Bank Association and others V/s Union of India and others, as per the judgment of Hon'ble High Court of Karnataka, in Crl.Rev.Pet.1333/2018 dated 02.02.2023, the proceedings being held as summary in nature. The statement of accused under section 313 of Code of Criminal Procedure has been taken as not recorded. As per the ratio laid down by 6 C.C.No. 37041 / 2021 the Hon'ble High Court of Karnataka, in Crl.Rev. Pet.1333/2018 dated 02.02.2023, wherein it is held that;
" Para 11:-There is no requirement of recording the statement of accused u/s 313 Cr.P.C. or under the NI Act 1881 or in chapter XXI Cr.P.C. As a matter of fact, the record of a summary trial under sec 263 of Cr.P.C., does not provide for recording the statement of the accused u/s 313 Cr.P.C.
The Judgement of conviction by the trial & confirmed by the appellate court upheld.
Two ratios
1. Without recording 313 statement.
2. In the absence of accused Judgment can be passed in138 offences.
Laid in 15 guidelines XV. In view of Apex Court Judgment Mandvi Co-operative Bank Ltd case, the accused shall not lead his evidence in defense by way of an affidavit.
XVI. Magistrate shall in every case u/s 138 NI Act draw the presumption u/s 118 & 139 NI Act as held in Rangappa Vs. Mohan & examine whether the defense of the accused is either plausible or moon shine and thereafter decide the case."
The accused herself not appeared before the court to give explanation to the incriminating evidence appeared in the 7 C.C.No. 37041 / 2021 trial of the complainant's case and also not chosen to lead any evidence.
05. Heard the oral argument of counsel of complainant. Perused the materials on record.
06. The points that arise for my consideration are as follows;
POINTS
1. Does the complainant proves beyond reasonable doubts that, the accused as issued cheque bearing No.No.500721 dated 25.08.2021 drawn on Rajarambapu Sahakari Bank Ltd.
Kolhapur for Rs.3,96,400/- towards the discharge of her lawful liability of the complainant and when the said cheque was presented for encashment, it was returned as "Item failed at par validation as per banker's memo and inspite of issuance of demand notice , the accused himself failed to pay the cheque amount, thereby has committed the offence punishable under section 138 of NI Act?
2. What Order or sentence ?
8 C.C.No. 37041 / 2021
07. Now my answer to the above points is as follows;
1. Point No.1: In the affirmative
2. Point No.2: As per final order for the following;
REASONS
08. POINT No.1: It is the specific case of the complainant that, towards discharge the legally enforceable debt, the accused has issued the cheque and the said cheque was presented for encashment, it returned unpaid as per banker's memo due to "Item Failed at Part Validation". Accordingly, the complainant issued demand notice to the accused and the said notice was duly served on the accused. Accused has not complied the notice. Thus, it is sought to prosecute accused persons and convict them for the offense punishable under section 138 of NI Act.
09. To bring home the guilt of the accused, as per the verdicts of the Hon'ble Apex court in the case of Indian Bank 9 C.C.No. 37041 / 2021 Association and others V/s Union of India and others , the sworn statement of the complainant has been recorded by way of examination-in-chief as PW.1. PW.1 has replicated the averments of the complaint. The complainant in all has produced 5 documents marked at Ex.P.1 to 5. Ex.P.1 is the alleged cheque issued by the accused, Ex.P.1(a) is the signature of the accused on cheque, Ex.P.2 is the bankers return memo, Ex.P.3 is the demand notice, Ex.P.4 is the postal receipt, Ex.P5 is the postal acknowledgment. Learned counsel for the accused not at all cross examined the PW.1.
10. To disprove the case of the complainant and also to rebut the statutory presumptions under section 139 of NI Act, the accused neither has entered in the witness box nor has produced documentary evidence.
11. As per section 118(a) and 139 of NI Act, it is very clear that, when the issuance of cheque drawn from the account of the drawer and also signature on the cheque is not denied or 10 C.C.No. 37041 / 2021 undisputed, the statutory presumptions shall be drawn in favour of the complainant stating that, the accused has issued the disputed cheque towards the discharge of her legal debt and that the complainant is the due holder of the said cheque. Even in the land mark judgments reported in, 2010(11) SCC 441, in the case of Rangappa Vs. Mohan, wherein it is held that;
" Once the cheque relates to the account of the accused and he accepts the same and also admits his signature on the cheque, then the initial presumption under section 139 of NI Act as well as under section 118 of NI Act has to be raised in favour of the complainant. It is a mandatory presumption. But the accused is entitle to rebut the same on preponderance of probabilities."
12. In the recent judgment reported in, 2021(5) SCC 283, in the case of Kalamani Tex and Another Vs. P.Balasubramaniyan, the larger bench of the Hon'ble Apex Court, it is held that;
" U/s 118 & 139: Once issuance of cheque and signature admitted , it is required to presume that the cheque was issued as consideration for a legally enforceable debt."11 C.C.No. 37041 / 2021
13. Before to advert the appreciation of oral and documentary evidence of respective parties, it is necessary to find out whether the present complaint would meet the mandatory provisions of section 138 of NI Act or not?
14. On perusal of the cheque, banker's memo, demand notice and postal records which are marked at Ex.P.1 to P.5 and the present complaint is filed on 30.10.2021. By considering these material documents and the presentation of complaint, it appears that, the present complaint is filed by complying the provisions of section 138(a) to (c) of NI Act.
15. Further, the accused has not given reply to the demand notice at Ex.P.3. Therefore an inference can be drawn against the accused that, he has issued the cheque at Ex.P.1 towards discharge of her debt and the same has got statutory presumption under section 118(a) of NI Act about the issuance of the same by the accused for some consideration and which corroborates the oral testimony of 12 C.C.No. 37041 / 2021 PW.1. The evidence of PW.1 remain unchallenged and un- controverted and also the cheque at Ex.P.1 and signature there on at Ex.P.1(a) is not disputed. Therefore, the statutory presumption under section 139 of NI Act shall be raised in favour of the complainant. There is no rebuttal evidence produced by the accused either by making cross examination of PW.1 or by producing her own evidence before the court. Hence, by the evidence of PW.1 coupled with the documents at Ex.P.01 to 5, I am of the opinion that, the complaint has proved that, the accused has received machine worth of Rs.7,96,500/- towards the discharge of the legally enforceable liability, the accused has issued the cheque at Ex.P.1 for an amount of Rs.3,96,400/- and the said cheque was returned unpaid due to "Item Failed at par validation". Therefore, the accused has failed to rebut the statutory presumptions under sections 118(a) & 139 of NI Act raised in favour of the complainant. Therefore, I answered point No.1 in the affirmative.
13 C.C.No. 37041 / 2021
16. POINT NO.2: In view of the reasons stated and discussed above, the complainant has proved the guilt of the accused punishable under section 138 of N.I. Act. It is worth to note that, the offence is of the nature of civil wrong. Hence, it is proper to award sentence of fine, instead of awarding sentence of imprisonment. Accordingly, this court proceed to pass the following;
ORDER
Acting under section 255 (2) of
Criminal Procedure Code, accused is
hereby convicted for the offence
punishable under section 138 of
Negotiable Instrument Act and sentenced to pay fine of Rs.5,10,000/-(Rupees Five Lakhs Ten Thousand only). In default, accused shall undergo simple imprisonment for 1 (one) year.
Acting under section 357(1) of code of criminal procedure, it is ordered that an amount of Rs.5,00,000/-(Rupees Five Lakhs only) there from shall be paid to 14 C.C.No. 37041 / 2021 the complainant as a compensation, remaining fine amount of Rs.10,000/-
(Rupees Ten Thousand only) is defrayed to the state for the expenses incurred in the prosecution.
The bail bond of accused stands canceled subject to appeal period.
Supply free copy of judgment to the accused .
{Dictated to the stenographer, transcribed and computerized by her, revised corrected and then pronounced in the open court on this 16th day of July 2024}.
(BHOLA PANDIT) C/c XX ACMM, Bengaluru.
ANNEXURE List of witnesses examined on behalf of complainant:
P.W.1 Mr.Ananth N M List of documents produced on behalf of complainant:
Ex.P. 1 Cheque
Ex.P. 1(a) Signature of accused
Ex.P. 2 Bank return memo
15 C.C.No. 37041 / 2021
Ex.P. 3 Copy of the legal notice
Ex.P. 4 Postal receipt
Ex.P. 5 Postal acknowledgment
List of witnesses examined on behalf of accused:
-Nil-
List of documents produced on behalf of accused:
-Nil-
C/c XX A.C.J.M., Bengaluru.