Bangalore District Court
Rajashekar. A.K vs Preetham. P on 15 March, 2025
KABC030093412021
Presented on : 08-02-2021
Registered on : 08-02-2021
Decided on : 15-03-2025
Duration : 4 years, 1 months, 7 days
IN THE COURT OF THE XXIII ACJM, BENGALURU
-: Present :-
Smt.Asha K.S., B.A.L, L.L.B.,
XXIII ACJM, BENGALURU,
C.C. No.2845/2021
Dated: the 15th day of March 2025
Complainant :- Sri.Rajashekar A.K.
S/o.Krishnegowda,
Aged about 32 years,
Residing at No.13/48/30,
2nd Cross, Mangala Main Road,
Near KEB Office, Vijayanagara,
Bengaluru-560040.
(By Sri.Girish Gowda. N.H, Advocate)
-V/s -
Accused :- Sri.Preetham.P.
S/o.Prabhakar M.A.,
R/at No.E61, Samadi Road,
Aamiya Home Needs,
Kottigepalya, Vishwaneedam Post,
Bengaluru North-560091.
Also at:
No.12, III B Main,
2
C.C.No.2845/2021
M.C. Layout Park Road,
Srigandhakavalu,
Bengaluru-560091.
(By Sri.M.Venkatesh., Advocate)
Offences complained of U/s 138 of Negotiable Instruments Act.
Plea of the Accused Not Pleaded guilty.
Final Order Accused is Convicted
Date of Order 15.03.2025.
(Smt.Asha K.S,)
XXIII ACJM, Bengaluru.
JUDGMENT
The complainant has filed the present complaint under Section 200 of Cr.P.C. against the accused for the commission of an offense punishable under section 138 of Negotiable Instruments Act.
2. The case of the complainant in brief is as under:-
"The complainant and accused are known to each other from several years. The accused had approached the complainant for financial assistance of Rs.2,38,000/- to meet his financial problems in the month of June 2019. The accused has also agreed to repay the same on or before December 2019. On demand by the complainant, in the month of January 2020, the accused prays for further time 3 C.C.No.2845/2021 to repay the amount. Thereafter accused had issued cheque for Rs.2,38,000/- cheque bearing No.366390 dated 06.02.2020 drawn on ICICI Bank Ltd, ITPL White Field Branch, Bengaluru. When the complainant has presented the said cheque for realization through his banker Janatha Seva Co-op. Bank Ltd, Mudalapalya branch, Bengaluru, the same has been returned with an endorsement as "Funds Insufficient" on 07.02.2020.
3. The complainant caused a legal notice on 27.02.2020 through RPAD to the residential address and official address. Notice has been served to the accused on 28.02.2020. Thereafter also accused has not chosen to issue reply notice and not paid amount.
4. After filing of complaint, cognizance was taken. In pursuance of summons, accused appeared before the Court and he had enlarged on bail. Substance of accusation has been framed and contents of its read over to the accused. Accused pleaded not guilty and he claimed to be tried.
5. In order to prove his case complainant has examined himself as PW.1 and got marked 09 documents at Ex.P.1 to 09 on behalf of the complainant. After closure of complainant evidence, accused has been examined under section 313 of Cr.P.C and he has denied the incriminating circumstance appeared against him in the evidence and 4 C.C.No.2845/2021 opted to lead defense evidence. Accused has been examined as DW-1 and documents were marked at Ex.D.1 and D.2. One witness examined as DW-2.
6. Thereafter arguments heard and perused written arguments.
7. The following points arise for my determination: -
1) Whether the complainant has made out all the ingredients of Sec.138 of Negotiable Instruments Act to prove the guilt of accused?
2) What Order?
8. On hearing the arguments and on perusal written arguments and the materials placed on record, my answers to: -
Point No.1:- In the Affirmative Point No.2:- As per final order for the following:-
REASONS
9. It is the case of complainant is that the accused and complainant are known to each other and accused had borrowed amount of Rs.2,38,000/- and to discharge the said liability, he had issued Ex.P.1 cheque. On presentation said cheque has been returned for the reasons "Funds Insufficient". After issuance of notice also the accused has 5 C.C.No.2845/2021 not chosen to issue reply notice and not repaid the amount. Thereafter, the complainant has filed this complaint.
10. To attract Sec.138 of NI Act it is necessary to fulfill the ingredients of said provision. I have carefully perused the section 138 of of N.I.Act, it has three ingredients which are as follows:
1. That there is a Legally enforceable debt,
2. That the cheque was drawn from the account of bank for discharge in whole or any part of any debt or other liability which pre-supposes a legally enforceable debt.
3. That the cheque so issued had been returned due to insufficiency of funds.
11. Keeping in view the ingredients of Sec.138 of Negotiable Instruments Act. Now I proceed to reproduce the Sec.139 and 118(a) of N.I.Act here itself.
12. Sec.139 of N.I.Act reads as follows "Presumes in favor of holder, it shall be presumed unless the contrary is proved, that the holder of cheque received the cheque, of the nature referred to in Sec.138, for the discharge, in whole or in part or any debt or other liability".
13. Sec.118(a) reads as follows "Presumption as to Negotiable Instrument Act until the contrary is proved, the following presumption shall be made (a) of consideration- that every negotiable instrument was made or drawn for 6 C.C.No.2845/2021 consideration, and that every such instrument, when it has been accepted endorse, negotiate or transferred, was accepted, endorsed, negotiated or transferred for consideration".
14. Keeping in view of the ingredients and provision of Sec.139 and 118(a) of N.I.Act, now I proceed to discuss the documents in the case. I am of the opinion that I need not repeat the entire case of the complaint once again since I have already stated the same at the beginning of this judgment.
15. To prove his case, the complainant has examined himself as PW-1 and produced 09 documents and same has been marked as Ex.P.1 to P.09. The cheque as per Ex.P.1 and and signature thereon as per Ex.P.1(a). Bank memo as per Ex.P.2. Legal Notice as per Ex.P.3. Postal Receipts as per Ex.P.4 & P.5. Track consignment reports as per Ex.P.6 to P.9.
16. In the cross-examination of PW-1 he has deposed that he is a driver and he used to purchase old vehicles and sell to others. Accused had sold his vehicle Etios and Qualis car to him. Age of accused is about 38 years, but he does not know about an educational details of accused. He does not know about the family members of accused. He is working in Manju Travels as a driver and he is getting monthly income of Rs.50,000/- to Rs.70,000/-. He had let 7 C.C.No.2845/2021 out one car to ISRO company and from that also he is getting Rs.40,000/- per month. Father of accused was owning Toyato Qualis vehicle. There are bank statements to show that as on the date of alleged transaction he had Rs.2,38,000/-. He sold one vehicle to his friend and he paid said amount to accused. He does not recollect the number of said vehicle. He does not know the house number and name of layout of accused.
17. He further deposed that he is the owner of KA-02 AD 5929 vehicle. He had purchased said vehicle in the year 2016-17 and that vehicle was in the name of accused. He does not recollect that for how much amount he had purchased said vehicle from the accused and how much amount he paid to the accused. There was an agreement to show that he had purchased a car from accused. There was a recital in the said agreement with regard to payment of loan pertaining to said car and he only paid installments of loan of car. There is a difference in ink pertaining to signature and other writings in the cheque. Accused is an Engineer. There is a mistake in spelling of words in the cheque.
18. He further deposed that he paid installment of car loan till 2018 and thereafter documents of car has been transferred into his name. He and driver were used to drove the said car. There was no an accident in the year 2019 8 C.C.No.2845/2021 with respect to that car and there was no quarrel between himself and accused. Apart from car transaction, there was an other transaction between himself and accused. He denied the suggestion that after accident, accused had paid Rs.2,50,000/- to him and accused had issued cheque for security purpose.
19. Accused has denied the case of complainant and to prove his defence he has examined as DW-1. He has deposed that he knows the complainant and there was no loan transaction between himself and complainant. In the year 2013 he had purchased a Toyota Etios car bearing No.KA-02 AD 5929. Complainant and his father are drivers in Manju Travels and they were friends. Due to old age his father was unable to drive the vehicle, complainant has agreed to purchase the said vehicle in the year 2016 and purchased for some of Rs.7,50,000/-. There was due of 48 EMI installments of car loan and the complainant has agreed to pay said installments and entered into an agreement of sale also. At that time the complainant has taken blank cheque from his father.
20. He further deposed that the said vehicle met with an accident with a motorcycle and that accident was settled by payment of money and on that account the complainant demanded a part payment from him and his father and threatened that otherwise an accident case could register in 9 C.C.No.2845/2021 his name. Therefore he paid Rs.31,005/- through online on 03.01.2018. Again complainant has demanded for Rs.2,50,000/- as additional amount of expenditure and also demanded to transfer the vehicle in the name of complainant. The complainant also made threat that he will misuse the cheque and he will file case against him and as such he has filed false case against him.
21. At the time of cross-examination of DW-1, he admits that Ex.P.1 cheque and signature belongs to him. He does not know about the complainant. KA-02 AD 5929 car belongs to him. Complainant known to his father and he sold his car to complainant. Now he is not residing in the address shown in his affidavit of evidence. Signature and mobile number found in Ex.P.8 belongs to him. He has received notice from postal department and signed the Ex.P.8. He has not filed any complaint against the complainant for alleged misuse of his cheque. He denied other suggestions.
22. At the time of arguments advocate for complainant has vehemently argued that complainant has proved his case and presumption is in favour of complainant. The accused has not filed any complaint against the complainant for alleged misuse of cheque. Advocate for accused also vehemently argued that there is no particulars with regard to date of alleged transaction, mode of payment and there are no documents to show 10 C.C.No.2845/2021 alleged payment by the complainant. It is further argued that there is a spelling mistake in the writing of cheque and handwriting found in cheque is not belongs to accused. He further argued that accused has rebutted the presumption.
23. The complainant has produced nine documents in support of his case to show that accused had issued cheque marked at Ex.P.1 cheque to discharge his liability and said cheque has been returned for the reason "Funds Insufficient" marked at Ex.P.2. Thereafter the complainant has demanded the accused for repayment by issuing notice marked at Ex.P.3. Said notice returned as delivered. As stated above it is the specific contention of accused is that no notice has been served to the accused and as such accused has not issued reply notice. Ex.P.6 and 7 are the postal track consignments. Ex.P.8 and P.9 are report regarding delivery of notice. Ex.P.6 to 9 are postal track consignments. Before filing of this case complainant has issued notice to the accused as per Ex.P.3 and same has been returned as item delivered. On perusal of Ex.P.6 and P.7 i.e., postal track consignment, it is noticed that the notice has been served to the accused. It is not the case of accused that it is not his address. At the time of cross- examination of DW-1 he admits that he has received notice and signed to Ex.P.8. Ex.P.8 is the postal track consignment report and it shows that notice has been served to the accused. If really accused was not residing in the said 11 C.C.No.2845/2021 address, then he would have furnished his address. Here accused has not produced any other address to show that he was not residing in the said address. In the Ex.P.3 notice, there is a address of accused and said notice has been returned as item delivered. When notice has been issued to the correct address then it has to consider as deemed service.
24. As per Section 27 of General Clauses Act, if any notice sent with correct address has to be consider as deemed service. In the evidence of DW-1 also he has deposed that he has received notice, hence it clears that the accused was residing in the very same address. If there was no transaction between the parties, then there was no hurdle for him to issue reply notice and explain about his defence.
25. In the decision of Hon'ble High Court of Andhra Pradesh in Gorantla Venkateshwara Rao Vs. Kolla Veeraraghava Rao and another case, it was held that failing on the part of accused in giving reply to the legal notice issued by the complainant, is one of the strong circumstances to draw a inference that accused has borrowed amount from the complainant and cheque was issued towards payment of legally enforceable debt. Here, in this case on hand also in spite of receipt of legal notice also the accused did not chose to give reply, hence it is also one 12 C.C.No.2845/2021 of the circumstances which clear supports the case of complainant.
26. In the evidence of accused he has deposed that he had issued blank cheque to the complainant with regard to selling of car in favour of complainant in the year 2016. It is an admitted fact that complainant has purchased car belongs to the accused. If really accused had issued cheque with respect to car transaction in the year 2016, then there was no hurdle for the accused to take back his cheque till 2020. Because the complainant has presented cheque on 06.02.2020 and same has been returned for the reason "Funds Insufficient" on 7.02.2020. In the evidence of DW-1 he has deposed that the complainant was paying EMI installments of car loan and for that reason he had received blank cheque for security purpose. He has also deposed that when car was in the custody of complainant, there was an accident between the said car and another vehicle and on that time also he paid Rs.31,000/- once and Rs.9,000/- once. In such circumstances, he would have tried to take back his blank cheque. Here there is no effort from the accused for take back his cheque. As per Ex.D.1 B Register Extract of vehicle, ownership of car has been transferred in the name of complainant. After transfer of document also accused has an opportunity to get back his cheque but he has not issued any notice or not attempted to take back his cheque. As per accused there was a clashes between them 13 C.C.No.2845/2021 with regard to payment of EMI of car loan and also accident, in such circumstances no ordinary prudent man will simply sit by issuing blank cheque. As per accused there was a threat by the complainant that he will misuse the cheque if additional amount will not paid to him. In such circumstances no ordinary person will take risk and definitely they will give stop payment intimation to the bank. Accused is an Engineer and atleast he would have sent intimation to the bank for stop payment also but no such intimation has been given to the bank till today. There is no explanation from the accused that why he has not tried to take back his cheque.
27. After dishonour of cheque complainant has issued notice to the accused and admittedly accused has received said notice but no reply notice has been issued and not taken any defence. If really there was no transaction between the parties as alleged in the complaint and when there was a threat by the complainant, then there was no hurdle for the accused to issue reply notice and to take defence. But here no explanation from the accused for non- issuance of notice. There is no explanation from the accused that why he has not taken any steps against the complainant for alleged misuse of his cheque.
14C.C.No.2845/2021
28. Advocate for accused argued that the complainant has not produced any documents to show that accused was having financial capacity to lent loan. It is true that the complainant has not produced any documents with regard to his financial capacity. But during the cross- examination of DW-1, he admits that complainant only purchased his car for Rs.7,50,000/- in the year 2016. IT shows that the complainant had capacity to lent amount of Rs.2,38,000/- in the year 2020. Ex.D.2 shows that complainant has purchased the car of accused. When complainant has capacity to purchase car for Rs.7,50,000/- in the year 2016 then there was no difficulty for him to lent Rs.2,38,000/- in the year 2020. When DW-1 himself admits those aspects, then there is no necessity to produce documents by the complainant.
29. Advocate for accused argued that there is a spelling mistake in the writing of Ex.P.1 and handwriting of cheque is not belongs to accused. Here there is no dispute in the signature of cheque. Accused is disputing the handwriting of cheque, but not signature.
30. It is true that as per Section 20 of N.I.Act the holder of cheque can fill the cheque but he cannot fill the amount as per his wish. The holder of cheque can only fill the cheque as per contract between himself and who has issued the cheque. In this case the accused has admits the signature but he has specifically contended that he has not 15 C.C.No.2845/2021 authorized the complainant to fill the cheque for Rs.2,38,000/-. He has also contended that he has issued cheque for his car transaction. But accused has fails to prove his defence and there is no proper explanation from the accused that why he is kept quite from 2016 to 2020. It shows that the accused has issued cheque for his liability and not for car transaction. Hence the accused cannot take contention that he has not authorized the complainant to fill the cheque.
31. At the time of cross-examination of DW-1 he has deposed that there was an agreement between complainant and his father with regard to sale of car but intentionally both parties have not produced the said agreement. When there is no dispute with regard to sale of car, then there is no necessity to discuss much on that point. Though accused has contended that he had transferred amount to the complainant, when complainant has met with an accident but no material has been placed before the Court. If really accused had transferred amount in favour of complainant, then nothing was prevented him to produce his bank statement. Here no such effort from the accused. He has not explained that why he is kept quite for all these years. If really complainant had misused the cheque of accused, then there was no hurdle for him to narrate the same in his reply notice. As stated above accused has not chosen to issue reply notice. If really accused has not 16 C.C.No.2845/2021 borrowed amount then why he had not taken any steps against the complainant for take back his cheque. In such circumstances why he has not taken any steps against the complainant for alleged misuse of his cheque. He has also not issued any intimation to bank for stop payment also. After transfer of documents pertaining to ownership of car in the name complainant also, accused has not taken any steps to take back his cheque and not chosen to issue intimation to the bank for stop payment. It is not an act of ordinary prudent man. No ordinary prudent person will simply sit for years after issuance of blank cheque and after its presentation also. All these aspects show that only to escape from his liability accused is denying the transaction.
32. As per Section 114 of Indian Evidence Act court may presume that bill of exchange was accepted for good consideration. Issuance of cheque is proved. Hence presumption can be drawn. Therefore, it probabalizes that the transactions alleged in the complaint is genuine.
33. Regarding the burden of the accused to rebut the presumptions in N.I Act the Hon'ble Apex Court in Rohitbhai Jivanlal Patel Vs State Of Gujarat in Crl.A.No.508 OF 2019 held:
"16.On the aspects relating to preponderance of probabilities, the accused has to bring on record such facts and such circumstances which may lead the Court to conclude either that the consideration did not exist or that its non-existence was so probable 17 C.C.No.2845/2021 that a prudent man would, under the circumstances of the case, act upon the plea that the consideration did not exist. This Court has, time and again, emphasized that though there may not be sufficient negative evidence which could be brought on record by the accused to discharge his burden, yet mere denial would not fulfill the requirements of rebuttal as envisaged under Section 118 and 139 of the NI Act..."
34. In the case on hand the accused has not disputed the issuance of cheque and signature but he has disputed transaction but till today not taken any steps against the complainant. He has not chosen to send intimation to the bank for stop payment and not issued any notice to the accused for return of his cheque. He did not issued reply notice. The accused has not proved his defence. As discussed above the accused has fails to rebut the presumption.
35. Under the criminal jurisprudence, the prosecution is required to establish the guilt of the accused beyond all reasonable doubt. However, the proceeding U/sec.138 of Negotiable Instruments Act is quasi-criminal in nature. In these proceedings proof beyond reasonable doubt is subject to presumptions envisaged under sec.118, 139 and 146 of Negotiable Instruments Act. An essential ingredient of Sec.138 of Negotiable Instruments Act is that cheque in question must have been issued towards a legally or liability. Sec.118 and 139 of Negotiable Instruments Act envisage certain presumptions. Under Sec.118 a 18 C.C.No.2845/2021 presumption shall be raised regarding consideration, date, acceptance, transfer, endorsements and regarding the holder in due course of Negotiable Instruments. Even under Sec.139 a rebuttal presumption shall be raised that the cheque in question was issued regarding discharge of a legally enforceable debt. These presumptions are mandatory presumptions that are required to be raised in case of Negotiable Instruments. These presumptions are not conclusive presumptions, but are rebuttable. The accused has fails to rebut the presumption.
36. Advocate for accused has produced Judgment in Crl. Appeal No.199/2013 in V.Sudesh Pawar Vs. M.Nagesh. In that Hon'ble High Court of Karnataka held that when cheque was not issued as security for repayment of loan but for business transaction then accused is entitled for acquittal. But in this case complainant has not received cheque for business transaction but for repayment of loan. Moreover the facts and circumstances of both the cases are not one and the same. Hence ratio held in above authority is not applicable to case on hand.
37. Advocate for accused has produced another Judgment reported in 2024 (2) KCCR 1843 in Krishna Naik K Vs.T.B.Basavaraj. In that Hon'ble High Court of Karnataka held that when there is a difference in ink of signature and handwriting and it corroborates plea of 19 C.C.No.2845/2021 accused that blank cheque was given to other person and from whom complainant got it and when complainant fails to prove his financial capacity, then accused is entitled for acquittal. In this case there is no corroborative documents to show that accused had issued cheque for security purpose and DW-1 and 2 both admit that in the year 2016 itself complainant has borrowed their car for Rs.7,50,000/-. It shows that complainant had financial capacity to lent hand loan. The facts and circumstances of both the cases are not one and the same.
38. The decision reported in AIR 2010 SC 1898 (Rangappa V/s. Mohan), the Honorable Apex Court held that once execution of Negotiable instrument is either proved or admitted, then the court shall draw a presumption to the effect that the said negotiable instrument has been drawn for valid consideration and the legally recoverable debt was in existence.
39. In the authority reported in 2001 SC 2895 in K.N.Beena V/s. Muniyappan in that Hon'ble Apex Court held that as per Sec.139 of NI Act the court has to presume, unless the contrary was proved, that the holder of the cheque received the cheque for discharge in whole or in part of a debt or liability. In this case the complainant has proved his initial burden but the accused has failed to rebut the presumption.
20C.C.No.2845/2021
40. The complainant has proved that accused had issued cheque towards discharge of his legally recoverable debt or liability. Admission of DW-1 and 2 itself shows that PW-1 had financial capacity to lent amount to the accused and they were known to each other. There is no proper explanation from the accused that why he had not tried to take back his cheque from 2016 to 2020. There is no effort from the accused to take steps against the complainant for alleged misuse of his cheque. All these aspects show that there was a transaction between the parties and to discharge his liability only, accused had issued Ex.P.1. The accused has fails to prove that there is no legally recoverable debt or liability. Hence, in view of the above discussion, this court is of the opinion that the complainant has proved his case. On careful perusal of materials on record I am of the opinion that there is a legally recoverable debt or liability. All these aspects show that accused had issued cheque to the complainant towards discharge of his liability. The complainant has proved the initial burden and accused has not produced any cogent evidence to disprove the contention of the complainant and not rebutted the presumption. The oral evidence of PW.1 coupled with documentary evidence corroborates with each other. Considering the facts and circumstances of the case the version of complainant appears to be true. The ingredients required to fulfill Sec.138 of NI Act also proved. Hence, I 21 C.C.No.2845/2021 hold that there are materials available on record to conclude that accused has committed an offence U/Sec.138 of NI Act, hence I answered Point no.1 in the Affirmative.
41. Point No.2:- In view of the aforesaid reasons, I proceed to pass the following :-
-: ORDER :-
By invoking the power conferred under section 255(2) of Cr.P.C.,The accused is found guilty for the offence punishable under section 138 of Negotiable Instruments Act.
Accused is sentenced to pay a fine of Rs.2,38,000/- (Rupees Two Lakhs Thirty Eight Thousand only). In default to pay the fine, accused shall undergo simple imprisonment for a period of six months.
Further, acting under Sec.357(1)(b) of Cr.P.C., on recovery of sum of Rs.2,38,000/- (Rupees Two Lakhs Thirty Eight Thousand only), Rs. 2,33,000/- shall be paid to the complainant as compensation and Rs.5,000/- shall be remitted to the state exchequer.22
C.C.No.2845/2021 Supply free copy of this order to the accused forthwith.
(Dictated to stenographer directly on my computer, after clerical additions by him, script revised, corrected and pronounced by me in the Open Court on this the 15 th day of March 2025) (Smt.Asha K.S,) XXIII ACJM, Bengaluru.
ANNEXURE
1) List of Witnesses examined for complainant:-
PW.1 : Sri.Rajashekar A.K
2) List of documents marked on behalf of complainant: -
Ex.P.1 : Cheque.
Ex.P.1(a) : Signature of accused,
Ex.P.2 : Bank Memo,
Ex.P.3 : Legal Notice,
Ex.P.4 & P.5 : Postal receipts,
Ex.P.6 to P.9 : Track Consignment reports.
3) List of witness examined on behalf of the Accused :-
DW-1 : Preetham.
DW-2 : Prabhakar
4) List of documents marked on behalf of the Accused:-
Ex.D.1 : B- Register Extract.
Ex.D.2 : Vehicle Insurance Policy.
(Smt.Asha K.S,)
XXIII ACJM, Bengaluru.