Bangalore District Court
Mr. Arundas.P vs Mr.C.Kundapur on 11 May, 2018
IN THE COURT OF XXVII ADDL. CHIEF
METROPOLITAN MAGISTRATE, BANGALORE.
Present: Sri. N.Muniraja B.A., LL.B.,
XXVII A.C.M.M Bangalore.
Dated: This the 11th day of May 2018.
C.C. NO.7500/2017
Complainant Mr. Arundas.P
Aged about 45 years,
S/o.Mr.Appu.P
Proprietor,
M/s.Royal Moon Metal Products
Trading,
Office at No.48/51,
Bellary Road,
Near C.B.I Office,
Ganganagar North,
Bangalore-560 024.
Rep by its SPA holder
and Manager,
Mr.Gokuldas.P
Appoint by means of
Special Power of Attorney
dated:16.5.2014.
(Rep by Sri.VKV Adv. Advocate)
Vs.
Accused Mr.C.Kundapur,
Major,
R/at.No.537a,
7th Main, IVth Phase,
III Stage,
Peenya Industrial Area,
Bangalore-560 058.
Proprietor of
M/s.Premier Controls,
Office at No.55,
KIADB Industrial Area
Anchepalya,
2 C.C.No.7500/2017
Kunigal,
Tumkur District.
(Reptd by Sri.TMS.Adv)
*****
JUDGEMENT
The complainant filed this complaint against the accused for the offence punishable U/s.138 of the Negotiable Instruments Act.
2. Brief facts of the complainant case are as follows:
The accused being the proprietor of M/s.Premier Controls, towards discharge of outstanding liability had issued cheques
bg.Nos.000174 and 000175 dated 17.7.2014 for a sum of Rs.4,00,000/- each drawn on Bank of Baroda, Rajajinagar, Bangalore to the complainant. On presentation of the said cheques for realization by the complainant through his banker, the Federal Bank, Limited, R.T Nagar Branch, Bangalore the same came to be dishonoured on 2.9.2014 as payment stopped by drawer. Upon receipt of 3 C.C.No.7500/2017 information from the bank about the dishonour of the cheques, the complainant had issued legal notice dated 9.9.2014 to the accused and the said notice duly served to the accused on 12.9.2014. The accused sent untenable reply to the said notice and he has not paid the cheques amount. Hence, this complaint.
3. The accused appeared through his advocate and he enlarged on bail. Substance of accusation read over to the accused and he pleads as false.
4. To prove the guilt of the accused, SPA holder of the complainant examined as PW1 and got marked 13 documents as per Ex.P.1 to P.13 and closed his side evidence. On closure of the complainant side evidence, statement of the accused recorded as required U/s.313 of Cr.P.C. The accused has denied the incriminating circumstances, which appears against him in the complainant side evidence. The accused has led defence evidence as DW1 and 4 C.C.No.7500/2017 during the course of cross-examination of PW1 got marked Ex.D.1 document.
5. Heard the learned counsels for the complainant and accused. The learned counsel for the accused has also filed written arguments and I perused the records.
6. The points that would arise for my consideration are as follows:
(i) Whether the complainant proves that the accused issued Ex.P.1 & 2 cheques towards discharge of legally enforceable debt or liability and the said cheques dishonoured.?
(ii) Whether the complainant proves that after dishonour of cheques, served notice to the accused in compliance of Sec.138(b) of N.I Act?
(iii) What order?
7. My answer to the above points are as follows:-
Point No.1 : In the Negative Point No.2: In the Affirmative Point No.3: As per the final order, for the following.5 C.C.No.7500/2017
REASONS
8. Point No.1 : It is the case of the complainant that, the accused being the proprietor of M/s. Premier controls towards discharge of outstanding liability had issued Ex.P.1 & 2 cheques and on presentation the said cheques dishonoured as per Ex.P.3 & 4 bank endorsements as payment stopped by drawer. PW1 who is the SPA holder of the complainant in his chief examination affidavit has reiterated the contents of the complaint averments.
9. As borne out from the cross-examination of PW1 and defence evidence of the accused (DW1), defence of the accused is that, he being the proprietor of M/s. Premier Controls was purchasing steels from the complainant on credit basis for the period of 90 days and for that he was issuing undated cheques to the complainant for security purpose. The accused has paid the cheques amount 6 C.C.No.7500/2017 of Rs.4,00,000/- each to the complainant through RTGS and the complainant has not returned the cheques obtained for security purpose and therefore, the accused had issued stop payment instructions.
10. The accused neither in the cross-examination of PW1 nor in his defence evidence dispute that Ex.P.1 & 2 cheques drawn from his account and his signatures thereon. Further, there is no dispute about the issuance of cheques infavour of the complainant. Since the accused has not denied his signatures on Ex.P.1 & P.2 cheques and issuance of cheques in favour of the complainant, presumption U/s.139 of N.I Act raises in favour of the complainant that the accused has issued the cheques in question in favour of the complainant towards discharge of any debt or liability. However, the said presumption is rebuttable in nature and burden shifts on the accused that, he has not issued the cheques for discharge of any debt of liability. 7 C.C.No.7500/2017
11. The learned counsel for the accused has relied upon the decision reported in (2006) 6 SCC 39 (M S Narayana Menon @ Mani V/s State of Kerala and another) where in the Hon'ble Supreme Court of India held that the accused can discharge his burden on the basis of preponderance of probabilities through Director circumstantial evidence. For the said purpose he can also rely upon evidence adduced by the complainant. The same principle is laid down in the decision reported in ILR 2008 Kar 3635 (K. Narayana Nayak V/s Sri. M. Shivaramashetty). The learned counsel for the accused has relied upon another decision reported in ILR 2007 Kar 2709 (M. Senguttuvan V/s Mahadevaswamy) where in the Hon'ble High Court of Karnataka held that the presumption u/s 139 of N.I. Act need not be rebutted only leading defense evidence and the said presumption can be rebutted even on the basis of the facts elicited in the cross examination of the complainant. With this background let me appreciate 8 C.C.No.7500/2017 the evidence on records that, whether the accused is able to rebut the presumption U/s.139 of the N.I. Act raises in favour of the complainant.
12. The accused during the course of cross examination of PW1 or in his defence evidence not denied the fact that, the complainant is the proprietor of M/s. Royal Moon Metal Products Trading. Further, Ex.P13 VAT certificate clearly establishes that the complainant is the proprietor of M/s. Royal Moon Metal Products Trading. During the course of cross-examination of PW1 on behalf of the accused disputes the authority of PW1 to represent the complainant. On behalf of the complainant produced Ex.P.9 Certified copy of the SPA executed infavour of PW1. During the course of cross- examination of PW1 on behalf of the accused contended that, the complainant not produced any documents to show that, PW1 is the Manager of the complainant and he has no authority to represent 9 C.C.No.7500/2017 the complainant and Ex.P.9 is created one. Of course, PW1 has specifically denied the suggestions made on behalf of the accused, in this regard. It is seen from Ex.P.9 SPA that, the complainant appointed the PW1 to represent the complainant before the court of law. Therefore the contention of the accused that PW1 has no authority to represent the complainant cannot be accepted.
13. The accused in his defence evidence admits the facts that, he is the proprietor of M/s. Premier Controls. On behalf of the complainant produced Ex.P11 and 12 invoices to show the purchase of materials by the accused. In the course of cross- examination of PW1 on behalf of the accused not denied the purchase of materials by the accused from the complainant. Rather, the accused in the course of defence evidence admits that he was purchasing the steels from M/s. Royal Moon Pvt. Ltd. on credit basis. During the course of cross-examination the 10 C.C.No.7500/2017 accused admits that, he has purchased the materials as per Ex.P.11 & 12 invoices. Therefore there is no dispute about the purchase of steels by the accused from the complainant on credit basis. But the contention of the accused is that, at the time of purchase of materials he issued undated cheques to the complainant for security purpose and the accused has paid an amount of Rs.4,00,000/- each on two occasions to the complainant, but the complainant not returned the cheques and as such, he had issued stop payment instructions to the bank.
14. PW1 in the cross examination admits that one A. Basanthakumar was working as Marketing Executive and Manager in M/s Royal Moon Metal Products Trading and he was looking after the affairs of sale of the materials and receipt of money with respect sold materials. Further it has come in the cross examination of PW1 that the said 11 C.C.No.7500/2017 Basanthakumar having knowledge about how much materials supplied to premier controls by the complainant and how much amount paid and how much due by the accused and he was incharge of the transactions of M/s Royal Moon Metal Products Trading. PW1 in the course of cross examination admits that as per Ex.D1 statement of accounts of Bank of Baroda, Rajajinagar Branch that on 11-12- 2013 and 16-01-2014 an amount of Rs.4 lakhs each credited to M/s Royal Moon Metal Products Trading from M/s Premier Controls through RTGS and at that time Basanthakumar was incharge. In the course of cross examination of the accused on behalf of the complainant by way of suggestion admits the receipt of Rs. 8 lakhs from the accused.
15. In the course of cross examination of the accused on behalf of the complainant tried to contend that the accused purchased the materials from the complainant on several occasions and towards 12 C.C.No.7500/2017 partial discharge of the said transactions the accused paid Rs.8 lakhs and he is due of Rs.8 lakhs and towards discharge of the said balance amount of Rs.8 lakhs the accused has issued Ex.P1 and 2 cheques. Of course the accused has denied the suggestions made on behalf of the complainant in this regard. The accused in the cross examination stated that on two occasions in the months of October and December, 2013 he has purchased the materials from the complainant. Ex.P11 and 12 invoices produced by the complainant also shows only two transactions of the accused. It is pertinent to note that there is no averments in the complaint to the effect that on several occasions the accused purchased the materials from the complainant and towards partial discharge of outstanding, the accused issued the cheques in question. Further PW1 in the cross examination stated that they are having documents to show that Ex.P1 and 2 cheques are relate to which bills and he further admits that in 13 C.C.No.7500/2017 the complainant firm maintained the ledger book for day to day transactions. He further stated that in the complainant firm pertaining to some customers maintained the Account books and not maintained pertaining to some customers. If the accused purchased the materials from the complainant on several occasions and the accused made payment of Rs.8 lakhs towards partial discharge and still he is due of Rs.8 lakhs, definitely the complainant would have maintained the accounts in this regard. But the complainant has not produced any such documents.
16. PW1 in the cross examination admits that Royal Moon Metal Products Trading is an income Tax Assessee. He stated that he has to verify whether in the Income Tax returns shown the balance amount payable by the accused or not. It is pertinent to note that if the accused is due of Rs.8 lakhs to the complainant, definitely the complainant shown the same in the Income Tax returns. But the 14 C.C.No.7500/2017 complainant has not produced any such Income Tax returns. There are no reasons for the complainant for not producing day to day transaction book, statement of accounts and Income Tax returns. Since there are no averments in the complaint and in the absence of material proof, the version of the complainant that on several occasions the accused purchased materials from the complainant and towards partial discharge he paid Rs.8 lakhs and for payment of remaining balance amount of Rs.8 lakhs the accused has issued the cheques in question as contended in the cross examination of the accused cannot be accepted.
17. The learned counsel for the complainant has argued that as per Ex.P11 and 12 invoices the accused purchased materials from the complainant worth of Rs.13,92,327/- and even accepts that the accused has paid Rs.8 lakhs to the complainant, the accused is still liable to pay balance amount of 15 C.C.No.7500/2017 Rs.5,92,327/- to the complainant. No doubt it is true that as per Ex.P11 and 12 invoices the accused purchased the materials worth of Rs.13,92,327/- from the complainant. But to accept the line of the arguments of the learned counsel for the complainant, it is not the case of the complainant that the accused has issued the cheques in question towards partial discharge of total outstanding of Rs.13,92,327/- and there are no averments in the complainant to that effect is one aspect of the matter. Even considered the arguments of the complainant side, but Ex.P1 and 2 cheques amount exceeds the alleged balance amount of Rs.5,92,327/- asserted by the learned counsel for the complainant. When the cheque amount exceeds the actual liability, then presumption u/s 139 of the N.I. Act could not be drawn. Therefore on that count arguments of the learned counsel for the complainant cannot be accepted.
16 C.C.No.7500/2017
18. The claim of the complainant against the accused under Ex.P1 and 2 cheques is of Rs.8 lakhs. As noticed above PW1 admits the receipt of Rs.8 lakhs through RTGS from the accused as per Ex.D1 Bank Statement. Therefore the claim for Rs.8 lakhs of the complainant is discharged by the accused. PW1 in the course of cross examination admits that the complainant supplying the materials to the customers on credit basis for the period of 90 days and the customers used to pay the amount within 90 days and for payment of amount within 90 days they used to obtain cheques for security purpose. From the above admission of PW1 it is crystal clear that whenever the complainant supplied the materials to the customers on credit basis, they used to obtained the cheques for security purpose. PW1 in the cross examination further admits that there is a difference in the hand writings of the dates mentioned in Ex.P1 and 2 cheques and he written the dates in Ex.P1 and 2 cheques at the time of presentation of the same to 17 C.C.No.7500/2017 the bank. In view of the above said admissions of PW1, the defence of the accused that when he purchased the materials from the complainant on credit basis, he has issued undated cheques to the complainant for security purpose is probable. It is pertinent to note that the accused by issuing Ex.P8 reply notice to the notice issued by the complainant after dishonour of the cheques has spell out his defence version at the earliest itself and he able to prove his defence version by eliciting the facts in the cross examination of PW1 and also by leading oral as well documentary evidence.
19. In the decision cited above by the accused reported in (2006) 6 SCC 39 in the case of M.S. Narayan Menon @ Mani V/s State of Kerala and another the Hon'ble Supreme Court of India held that withholding of relevant evidence leads to draw an adverse inference against the party. Here is a case as observed above PW1 in the cross 18 C.C.No.7500/2017 examination admits that one A. Basanthakumar sales executive and Manager having knowledge about the transactions of the accused. Further the complainant not produced the day to day transaction book, statement of accounts and documents relates to Income Tax. The above said A. Basanthakumar is the material witness to speak about the transactions of the accused. Further the above said documents are material documents to show the outstanding due by the accused to the complainant. Therefore non examination of the above A. Basanthakumar and non production of the above said documents leads to drawn an adverse inference against the complainant. In the decision relied upon by the accused reported in AIR 1961 SC 1316 (Kundan Lal Pallaram V/s Custodian, Evacuee property Bombay) the Hon'ble Supreme Court held about the same principle.
20. The accused by producing Ex.D1 Bank Statement proved that he has paid an amount of 19 C.C.No.7500/2017 Rs.8 lakhs to the complainant through RTGS. Further as discussed above the accused by eliciting the facts in the cross examination of PW1 probabilized his defence version that he had issued Ex.P1 and 2 cheques for security purpose at the time of purchasing the materials from the complainant. Since the accused has paid the an amount of Rs.8 lakhs to the complainant, the amount involved in Ex.P1 and 2 cheques cannot said to be legally enforceable debt or liability against the accused. The accused by eliciting the facts in the cross examination of PW1 and by leading defence evidence rebutted the presumption u/s 139 of the N.I. Act. In view of the above discussion I answer Point No.1 in the Negative.
21. Point No.2:- It is the case of the complainant that, after receipt of information from the bank regarding dishonour of the cheques, issued notice to the accused on 09-09-2014 and the 20 C.C.No.7500/2017 accused has received the said notice on 12-09-2014 and he has sent reply notice to the said notice. The complainant to prove the factum of issuance of notice and service of notice to the accused produced Ex.P.10 office copy of the notice dated 09-09-2014, Ex.P.5 and 6 postal receipts, P.7 postal acknowledgement and Ex.P.8 Reply notice issued by the accused. In the course of cross-examination of PW1 or in the defence evidence the accused not disputes the service of notice issued by the complainant after dishonour of the cheques. Absolutely, there is no denial of the accused regarding service of notice. Moreover, the accused has issued Ex.P.8 reply notice to the notice issued by the complainant. Therefore, it can be said that the notice issued by the complainant after dishonour of the cheques, served on the accused. Therefore, the complainant has complied mandatory requirement of Sec.138(b) of N.I Act. Hence, I answer Point No2. in the Affirmative.
21 C.C.No.7500/2017
22. Point No.3 :- In view of my findings on Point No.1 & 2 the complainant though proved that after dishonour of the cheques complied the mandatory requirement of sec.138(b) of the N.I. Act by issuing demand notice to the accused to make payment cheques amount, but the complainant fails to establish that the accused issued the cheques in question towards discharge of any debt of liability and in the result, I pass the following.....
ORDER
The complaint filed by the
complainant against Accused is dismissed. Consequently, acting U/s.255(1) of Cr.P.C, the accused is acquitted for the offence punishable U/s.138 of the N.I. Act and his bail bond is cancelled and he set at liberty.
(Dictated to the typist directly on computer, corrected and then pronounced in open court by me on this the 11th day of May, 2018) (N.Muniraja) XXVII A.C.M.M., Bangalore.
22 C.C.No.7500/2017ANNEXURE Witnesses examined on behalf of the complainant:
PW1 : Gokul Das P. Documents marked on behalf of the complainant:
Ex.P.1 & 2 : Cheques Ex.P.1(a) & 2(a) : Signature of the accused Ex.P.3 & 4 : Bank endorsements Ex.P.5 & 6 : Postal receipts Ex.P.7 : Postal acknowledgement Ex.P.8 : Reply notice of the accused Ex.P.9 : Certified copy of SPA Ex.P.10 : Legal Notice dt: 09-09-2014 Ex.P.11 & 12 : Invoices Ex.P.13 : Vat certificate Witnesses examined on behalf of the accused:
DW1 : Chandra Mohan Kundapur Documents marked on behalf of the accused:
Ex.D.1 : Statement of accounts of Bank of Baroda XXVII A.C.M.M Bangalore.23 C.C.No.7500/2017
Dt:11.05.2018 Complnt:Sri.VKV Adv., Accused:BSM Adv., For Judgement (Order typed vide separate sheet) ORDER The complaint filed by the complainant against Accused is dismissed. Consequently, acting U/s.255(1) of Cr.P.C, the accused is acquitted for the offence punishable U/s.138 of the N.I. Act and his bail bond is cancelled and he set at liberty.
(N.Muniraja) XXVII A.C.M.M., Bangalore 24 C.C.No.7500/2017