Bangalore District Court
Ravishankar S/O Siddappa vs B.S.Manunath S/O Late Shambhu on 27 January, 2020
IN THE COURT OF THE LX ADDITIONAL CITY CIVIL &
SESSIONS JUDGE, BENGALURU
(CCH-61)
Dated this the 27th day of January, 2020
:Present:
Sri Vidyadhar Shirahatti, LL.M
LX Addl. City Civil & Sessions Judge,
Bengaluru.
Crl. A. No. 293/2019,
APPELLANT Ravishankar S/o Siddappa, Aged about
55 years, R/at No.38, 'Sneha", 11th A
Cross, 6th Main, J.P.Nagar, 3rd phase,
Bengaluru.
(Sri R.S.Ravi, Adv)
VS.
RESPONDENT B.S.Manunath S/o Late Shambhu, Aged
about 57 years, R/at No.23, M/s Gopala
Krishna Traders, 50 Feet road,
Hanumanthanagar, Bengaluru.
(By Sri.B.V.S. Adv )
JUDGMENT
This appeal filed u/Sec. 374(3) of Cr.P.C., by the appellant, being aggrieved by the judgment of conviction and sentence passed in C.C.No.13918/2016, dt.8/1/2019 for 2 Crl.A.No.293/2019 offence punishable u/Sec.138 of N.I.Act on the file of XVIII ACMM, Bengaluru.
2. The appellant was the accused and respondent herein was the complainant before the trial Court and they are referred to as per the ranks assigned to them before the lower court.
3. The brief facts leading to this appeal can be stated as under:-
The accused and complainant are well known to each other from last several years. On 19/5/2015, the accused approached the complainant for hand loan of Rs.25,00,000/- in order to meet his financial difficulties. On 21/5/2015 the complainant had advanced the said amount to the accused by way of cash. Further to refund the amount accused has issued cheque. When the said cheque was presented for encashment it was dishonoured for the reasons 'insufficient funds '. Then the complainant got issued legal notice to the 3 Crl.A.No.293/2019 accused who neither replied the notice nor repaid the cheque amount.
4. Then the complainant presented the complaints under section.200 of Cr.P.C., for offence under Sec.138 of Negotiable Instruments Act. Learned Magistrate took cognizance and registered the case against the accused for offence punishable u/Sec. 138 of Negotiable Instruments Act and secured the presence of accused who after appearance, pleaded not guilty. Then the complainant examined himself as PW1 and got marked documents as per Ex.P.1 to Ex.P.16. After recording of statement of accused under Sec.313 of Cr.P.C., the accused examined himself as DW1 and no document produced on his behalf.
5. The learned Magistrate on hearing the arguments on both sides, found the accused guilty and proceeded to convict the accused for offence u/s. 138 of Negotiable Instruments Act and sentenced him to pay a fine of Rs.30,10,000/- and in default of payment of fine amount, the 4 Crl.A.No.293/2019 accused shall undergo S.I. for a period of one year. Besides, the trial Court awarded compensation of Rs.30,00,000/- out of the fine amount to the complainant acting u/Sec.357 of Cr.P.C., by passing the impugned judgment.
6. This judgment of conviction and sentence which is now under challenge by the appellant/accused on the following grounds:-
The impugned judgment of conviction and sentence passed by the trial court is opposed to the settled principles of law, facts and probabilities of the case. The trial court has misconceived in understanding the facts and circumstances of the case and came to the conclusion that the appellant has committed an offence punishable u/Sec.138 of N.I.Act. The learned Magistrate grossly failed to consider that, accused had issued cheque to one Goplakrishna Chit Funds as a security, where the accused had taken the chit amount of Rs.25,00,000/- from the said chit company. The complainant is working as a Manager to the said company and 5 Crl.A.No.293/2019 complainant's wife, sons and brothers are the directors of the said chit business. Taking undue advantage of the same, the complainant has presented the said cheque. The complainant has not led any cogent evidence to prove his case. No prudent man will advance the hand loan of Rs.25,00,000/- only on the basis of the cheque given by any person. The trial judge failed to consider the cheque in question was not issued for discharge of debt or liability. The impugned judgment of conviction is unsustainable and not tenable in the eye of law. Hence, prayed to set aside the impugned judgment of conviction and to acquit the accused by allowing the appeal.
7. After filing of this appeal, notice duly served on the respondent who made his appearance through a counsel. The trial Court records, have been secured.
8. Heard arguments of learned counsel for appellant and respondent.
9. Perused the records.
6 Crl.A.No.293/2019
10. In the light of the contentions taken up in the memorandum of appeals, the common points that arise for my determination are as follows;
1) Whether the trial court erred in not properly appreciating the defense set up by the accused in proper perspective?
2) Whether the learned Magistrate erred in
convicting the appellant/accused for
offence punishable u/Sec.138 of Negotiable Instruments Act?
3) Are there any grounds to interfere with the order of conviction and sentence?
4) What order?
11. My findings on the above points are as follows:
Point No.1 : In the Negative
Point No.2 : In the Negative
Point No.3 : Partly in the affirmative
Point No.4 : As per final Order
7 Crl.A.No.293/2019
REASONS
12. Point Nos.1 to 3:- All these points are taken together for discussion for the sake of convenience and to avoid repetition of facts.
13. I have carefully gone through the contents of appeal memo, trial Court records and the impugned judgment.
14. It is the specific case of the complainant that accused received a sum of Rs.25,00,000/- to meet his financial necessities and issued the cheque in question i.e., Ex.P.1 towards repayment of said loan amount. It is the further case of the complainant that since the cheque which was issued by the accused came to be bounced back as insufficient funds, the accused is liable to be convicted for offence punishable u/Sec. 138 of Negotiable Instruments Act.
15. On the other hand, it is defense set up by the accused that the cheque in question was not issued to the 8 Crl.A.No.293/2019 complainant and the said cheque has been issued to one Goplakrishna Chit Funds as a security, where the accused had taken the chit amount of Rs.25,00,000/- from the said chit company. The complainant is working as a Manager to the said company and complainant's wife, sons and brothers are the directors of the said chit business. Taking undue advantage of the same, the complainant has presented the said cheque and misused the said cheque for filing the complaint. It is further defense set up by the accused that he has not borrowed any loan amount from the complainant and hence, he is not liable to pay the said cheque amount.
16. Keeping in view the rival contentions of both the parties, I have carefully gone through the evidence let in by both the parties to answer the points in controversy.
17. Obviously, the burden is on the complainant to prove that the cheque in question was issued towards discharge of legally recoverable debt or liability. In this regard, the complainant examined himself as PW1 who in his 9 Crl.A.No.293/2019 evidence has reiterated the averments of the complaint and got marked original cheque, memo issued by the bank, receipt, copy of legal notice, postal receipt, postal acknowledgements, complaint given to the postal dept, postal tracking and I.T Records as per Ex.P.1 to 16.
18. In the cross examination on behalf of the accused, PW1 states that the accused received a Rs.25,00,000/- from him to meet his financial necessities and to repayment of the said loan, the accused has issued cheque in question. He has stated all these facts in his notice. He denied the suggestion that accused had issued cheque to one Goplakrishna Chit Funds as a security, where the accused had taken the chit amount of Rs.25,00,000/- from the said chit company. The complainant is working as a Manager to the said company and complainant's wife, sons and brothers are the directors of the said chit business. Taking undue advantage of the same, the complainant has presented the said cheque and there was no transaction 10 Crl.A.No.293/2019 between the accused and complainant. He denied the suggestion that the accused has issued the cheque in question with another transaction and he misused the same.
19. A careful appreciation and evaluation of the evidence of PW1 coupled with contents of Ex.P.1 to Ex.P.16, makes it clear that the accused and complainant were known to each other very well. Herein this case the accused does not dispute issuance of cheque and his signature found on the cheque in question. But it is his contention that, he has issued the cheque in question to the issued cheque to one Goplakrishna Chit Funds as a security, where the accused had taken the chit amount of Rs.25,00,000/- from the said chit company. The complainant is working as a Manager to the said company and taking undue advantage of the same complainant has misused the same. He further contended that, he has not borrowed any loan amount from his and hence, he is not liable to pay the said amount. But this 11 Crl.A.No.293/2019 contention of accused is not substantiated by any material on record.
20. Further, if really the accused had issued said cheque as security to the Gopala Krishna Chit Funds, he would not have kept mum without insisting said chit fund for returning the said cheque soon after repayment of such said amount. As such the defense set up by the accused is not believable and natural one.
21. Moreover, when the accused admits his signature found on Ex.P.1, the presumption under Sec.139 of Negotiable Instruments Act would arise in favour of the complainant.
22. In this regard I would like to rely upon the decisions of Hon'ble Apex court in Kishna Rao v/s Shankar Gowda in 2018(8) SCC 165 Financial loss Monterey loss - Negotiable Instrument Act 1981- 139- presumption under 139 does when may be fallen- ingredients and scope of Sec.139- does not - probable summaries- accused liberty may adduce evidence to rebut the presumption u/Sec.139- 12 Crl.A.No.293/2019 but mere denial regarding existence of debt was not serve any purpose in the event accused is able to raise probable defense which creates doubt with regard to existence of debt or liability presumption may fall.
23. In Rangappa Vs.Mohan in AIR 2010 SC 1898 wherein it is held that, The presumption mandated by S.139 of the Act does indeed include the existence of legally enforceable debt or liability. This is of course in the nature of rebuttable presumption and it is open to the accused to raise a defense wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant. S.139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of the cheque, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by S.138 can be better described as regulatory offence since the bouncing of a cheque is largely in nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and 13 Crl.A.No.293/2019 interpretation of reverse onus clauses and the accused/defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is settled position that when an accused has to rebut the presumption under Sec.139, the standard of proof for doing so is that of 'preponderance of probabilities'. Therefore, if the accused is able to raise. Therefore, if the accused is able to raise a probable defense which creates doubt about the existence of a legally enforceable debt or liability, the prosecution can fail. The accused can rely on the materials submitted by the complainant in order to raise such a defense and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own.
24. Moreover, when the accused admits his signature found on Ex.P.1 and handing over the same to complainant while borrowing loan amount, the presumption under Sec.118 and 139 of Negotiable Instruments Act would arise in favour of the complainant. But the accused has not produced any materials to rebut the said presumption. As such, no material is produced appreciate the defense set up by accused with 14 Crl.A.No.293/2019 regard. Therefore, the learned Magistrate has rightly appreciated and evaluated the evidence of PW1 in proper perspective. As such there is no any illegality or error committed by the Court below in appreciating the evidence available on record.
25. On careful appreciation of evidence of PW1 and the defense taken by the accused, it can be said that though he states that the cheque in question was issued only as a security to the chit fund company, his bald say itself cannot be relied upon. So, this aspect of the case goes to show that defense set up by accused is not probable.
26. Having regard to all these facts and circumstances, I am of the considered view that the learned Magistrate has rightly appreciated the oral and documentary evidence available on record in proper perspective. The learned Magistrate committed no error or illegality in appreciating and evaluating the documents relied upon by both the parties. Herein this case, the accused failed to rebut 15 Crl.A.No.293/2019 the presumption available in favour of complainant under Sec.139 of Negotiable Instruments Act. A bald denial of the case of complainant does not amount to a defense.
27. Furthermore, the accused has not replied the legal notice which was issued to him as per Ex.P.4. It appears from the records that the notice was issued through registered post and which was duly served on the accused. It shows that his action in keeping mum without replying the notice, goes to show that he purposefully kept quiet since he issued Ex.P1 towards repayment of loan amount.
28. Herein this case, the accused admits that the address shown in the legal notice at Ex.P.4 pertains to his residence. Such being the fact, there is a deemed service of legal notice on the accused, who neither replied the same nor paid the cheque amount. Therefore, the complainant has placed sufficient and ample materials on record to believe that the Ex.P.1 cheque was issued by accused towards repayment of loan amount of Rs.25,00,000/-, which he 16 Crl.A.No.293/2019 borrowed to meet his financial necessities. There are no such circumstances, wherein the case of complainant can be doubted. There are no grounds so as to interfere with the reasoning and findings of the Court below. As such the learned Magistrate committed no error or illegality in believing the case of complainant.
29. Having regard to the facts and circumstances of the case, I am of the view that the impugned judgment of conviction and sentence passed by the learned Magistrate is in accordance with settled principle of law, facts and probabilities of the case. Absolutely there are no grounds to interfere in the reasoning and findings given by the Court below so as to convict the accused. As such the impugned judgment of conviction is in accordance with the settled principles of law, facts and probabilities of the case. Hence, the impugned judgment of conviction deserves to be confirmed with.
17 Crl.A.No.293/2019
30. However, the facts and circumstances involved in the case on hand, do warrant this Court to interfere with regarding imposing of sentence amount and requires to modify the sentence imposed on accused by trial Court. Because the transaction between the complainant and accused has taken place in view of the close acquaintance. The accused issued the cheque in question towards the repayment of the amount, which he received from the complainant to meet his financial necessities. But the learned Magistrate awarded compensation excess to the cheque amount without assigning any reasons and without any basis. Though it is permissible under law to impose fine to the tune of double the cheque amount, sufficient justifiable grounds need to be assigned by Court to impose fine or award compensation to the tune of double or excess to the cheque amount.
31. Herein this case, absolutely, no reasons are assigned by the learned Magistrate to award compensation double the cheque amount. It appears, the loan transaction 18 Crl.A.No.293/2019 has taken place under the close acquaintance of complainant with accused. Even there is no such agreement to pay interest on the loan amount. Even no document was obtained from the accused either as a security or with regard to payment of any interest. Therefore, these facts would go to show that the complainant had no intention to claim any interest on such amount. Such being the fact, the learned Magistrate is not justified in awarding compensation double the cheque amount.
32. Furthermore, the thing would have been different if the learned Magistrate assigned any reasons for awarding compensation double the cheque amount. As such, the learned Magistrate is not justified in awarding compensation double the cheque amount without assigning any reasons to that effect. So, on these facts, I am of the view that the impugned order of sentence deserves to be interfered so as to modify the quantum of compensation awarded to complainant. Therefore, considering the fact that the transaction has taken place between the complainant and the 19 Crl.A.No.293/2019 accused company with regard repayment of amount, which he received from the complainant to meet his financial necessities, I feel that the accused shall be directed to pay compensation of Rs.25,10,000/- instead of Rs.30,10,000/- as awarded. Hence, the impugned order of sentence deserves to be interfered only with regard to quantum of compensation awarded by learned Magistrate. Hence, impugned judgment of conviction deserves to be confirmed with by modifying the quantum of sentence as observed above. Accordingly, I answer point No.1 and 2 in the negative and point No.3 partly in the affirmative.
33. 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 allowed in part.
The impugned judgment of conviction passed by the XVIII ACMM, Bengaluru, in CC. 20 Crl.A.No.293/2019 No.13918/2016 dt.27.6.2017 is confirmed. However the sentence stands modified as under:-
Acting u/Sec. 264 of Cr.P.C, the accused is hereby convicted and sentenced to pay fine of Rs.25,10,000/- for the offence punishable u/Sec.138 of Negotiable Instruments Act and in default of payment of fine amount, the accused shall undergo S.I. for a period of one year.
Out of the fine amount, a sum of
Rs.25,10,000/-an amount of Rs.25,00,000/- is
ordered to be paid as compensation to the complainant under Sec.357 of Cr.P.C., and remaining Rs.10,000/- shall be appropriated to the government.
Send a copy of this judgment to the Trial court along with TCR.
*** (Directly dictated to the stenographer on computer and then pronounced by me in the open court on this the 27th day of January, 2020) (Vidyadhar Shirahatti) LX Addl.City Civil & Sessions Judge, Bengaluru.21 Crl.A.No.293/2019
Judgment pronounced in the open court. Vide separately ORDER The appeal filed by appellant u/Sec. 374(3) of Code of Criminal Procedure is hereby allowed in part.
The impugned judgment of conviction passed by the XVIII ACMM, Bengaluru, in CC. No.13918/2016 dt.27.6.2017 is confirmed. However the sentence stands modified as under:-
Acting u/Sec. 264 of Cr.P.C, the accused is hereby convicted and sentenced to pay fine of Rs.25,10,000/- for the offence punishable u/Sec.138 of Negotiable Instruments Act and in default of payment of fine amount, the accused shall undergo S.I. for a period of one year.
Out of the fine amount, a sum of Rs.25,10,000/- an amount of Rs.25,00,000/- is ordered to be paid as compensation to the complainant under Sec.357 of Cr.P.C., and remaining Rs.10,000/- shall be appropriated to the government.
Send a copy of this judgment to the Trial court along with TCR.
(Vidyadhar Shirahatti) LX Addl.City Civil & Sessions Judge, Bengaluru.