Bangalore District Court
M/S Bhumandala Chits Pvt. Ltd vs Mr. Shridhar. N.N on 14 June, 2024
C.C.NO.28168/2021
0
KABC030751222021
Presented on : 13-10-2021
Registered on : 13-10-2021
Decided on : 14-06-2024
Duration : 2 years, 8 months, 1 days
IN THE COURT OF THE XXVIII ADDL. CHIEF
METROPOLITAN MAGISTRATE NRUPATHUNGA ROAD,
BENGALURU CITY
Present:
Soubhagya.B.Bhusher,
BA.,LL.B.,LL.M
XXVIII A.C.M.M, Bengaluru City.
DATED; THIS THE 14th DAY OF JUNE-2024
C.C.NO.28168/2021
Complainant: M/s. Bhumandala Chits Pvt.,Ltd.,
Regd and Admn office at No.# 64,
1st Floor, Nehru Road, Girinagar,
Bangalore-560085.
R/by its Foreman/Director,
A.Chandra Shekaraiah S/o Appaiah
Age: 62 years.
As per the order dated: 10.11.2022
Complainant company
R/by its Foreman/Director
Sri.Rudresh.M.S S/o.Shankregowda,
Age: 45 years.
(By Sri.Suresh Subbaiah.,Adv.,)
V/s
Accused: Mr.Sridhar.N.N C/o Venkatesh,
R/at # 1098, Sri. Venkateswara Krupa,
10th Main Road, 5th Cross,
Prakashnagar, Bangalore-02.
C.C.NO.28168/2021
1
(By Sri.D.Narase Gowda.,Adv.,)
:JUDGMENT:
This case arises out of the private complaint filed by the complainant against the accused under section 200 of Cr.P.C., for an offence punishable under section 138 of Negotiable Instruments Act.
2. The case of the complainant's in brief is as under:
It is the case of the complainant is that the complainant is a private limited company duly incorporated under the Indian Companies Act, being a legal entity and it has right to recover the money due from the subscribers and the guarantors. It is further stated that one Sheela.N.N subscribed chit group No.BCT01J-31 conducted by the complainant's branch at Girirnagar for the chit amount of Rs.5,00,000/- which is payable at Rs.10,000/- each month for 50 months. In the chit auction held on 10.08.2015, the said subscriber have offered the highest bid agreeing to forego a sum of Rs.2,00,000/- as a discount was duly confirmed by the complainant and she has received the prized amount by offering guarantors for the due payment of entire future monthly installments. In the said context, several documents were executed in favour of the complainant's company as per law such as On Demand Promissory Note, consideration receipt and surety proposal form etc., for the satisfaction of the C.C.NO.28168/2021 2 company and thereby making the liability of the payment of future monthly installments. After receiving the prized amount she was irregular in paying the chit installments and thereafter she became a defaulter inspite of several remainders, request and visit of officials of the complainant. Further the complainant also insist to the accused under the capacity of surety to make payment.
3. It if further stated that inspite of repeated request and personal visit, the accused had issued the cheque bearing No.000119 dated: 09.01.2020 for Rs.4,40,000/- drawn on the Karur Vysya Bank Ltd., Chikkabanavara Main Road Branch, Bangalore in favour of the complainant towards the discharge of the said installments amount due. Based on the assurance of the accused the complainant had presented the said cheque for collection through its banker the Bangalore City Co-operative Bank, Abalahalli Branch, Bangalore. But the said cheque was dishonored on 10.01.2020 as "Refers to Drawer", which came to the complainant on 13.01.2020. Thereafter, the complainant on 01.02.2020 issued a demand notice to the accused through its counsel by RPAD calling upon him to pay the cheque amount. The said notice was returned on 04.02.2020. Inspite of issuance of the notice, the accused neither reply to the notice nor paid the cheque amount. As such, the accused has committed an offence C.C.NO.28168/2021 3 punishable under section 138 of N.I.Act. Hence, the present complaint came to be filed before this court on 25.02.2020.
4. After the complaint was filed, the cognizance of the offence cited therein was taken and it was registered as P.C.R No.6152/2020. Sworn statement of the complainant was recorded. Since there were sufficient materials to proceed against the accused, an order was passed on 13.10.2021 to register the case in Register No.III.
5. Thereafter, summons was issued to the accused and he has appeared before the court through counsel and secured bail. He was furnished its necessary papers as complied under section 208 of Cr.P.C,. Thereafter, the plea of the accused was recorded by the court. He has pleaded not guilty and claimed to be tried.
6. The complainant's in support of its case, have examined its Director/Foreman as PW.1 and got marked total 16 documents at Ex.P.1 to 16 and closed its side. But during the cross examination of DW.1 Ex.P.17 and 18 are got marked.
7. After closer of the evidence of the complainant, the statement under section 313 of Cr.P.C, was recorded. He has denied the incriminating evidence appearing against him. In his defence the accused C.C.NO.28168/2021 4 examined himself as DW.1, but failed to mark any documents.
8. I have heard the arguments on both the sides and perused the written argument filed by the leaned counsel for the complainant and also perused the material placed on record.
9. The learned counsel for the complainant has relied upon the citations reported in AIR 2002 SC 3014, 2014 (1) DCR 204, Crl.A.No.2743/2023 and Cri.A.No.797/2002.
10. The learned counsel for the accused has relied upon the citations reported in (2008) 1 SCC(Cri) 200 and (2006)6 SCC 39.
11. Upon hearing the arguments and on perusal of the material placed on record, the following points arise for my consideration:
1. Whether the complainant proves that the cheque-Ex.P.1 was issued by the accused towards discharge of a legally enforceable debt/liability?
2. Whether the complainant further proves that the complainant have complied with all the mandatory provisions of section 138 of N.I.Act?
3.Whether the complainant proves beyond reasonable doubt that the accused inspite of Refer to Drawer he had issued the cheque-Ex.P.1 and thereafter failed to repay the amount within stipulated period inspite C.C.NO.28168/2021 5 of receipt of the notice-Ex.P.3 and thus have committed offence punishable under section 138 of N.I.Act?
4. What order?
12. My answers to the above points are as under:
Point No.1: In the Negative.
Point No.2: In the Negative.
Point No.3: In the Negative.
Point No.4:As per final order, for the following;
:REASONS:
13. POINT NO.1: The case of the complainant is that he was acquainted with the accused. Further one Smt.Sheela.N.N is a subscribed chit group No.BCT01J- 31 conducted by the complainant's branch at Girirnagar amount of Rs.5,00,000/- which is payable at Rs.10,000/- each month for 50 months. In the chit auction, she has offered the highest bid agreeing to forego a sum of Rs.2,00,000/- as a discount was duly confirmed by the complainant and she has received the prize amount by offering guarantors for the due payment of entire future monthly installments due by her. In the said context, several documents were executed in favour of complainant's as per law such for the satisfaction of the company and thereby making the liability of the payment of future monthly installments. After receiving the prized amount she was irregular in paying the chit installments and thereafter she became C.C.NO.28168/2021 6 a defaulter inspite of several remainders, request and visit of officials of the complainant. The complainant also insist to the accused under the capacity of surety to make payment. Inspite of repeated request and personal visit, the accused had issued the cheque in question in favour of the complainant towards discharge of the said installments amount due. As per the assurance of the accused the complainant presented the said cheque for collection through its banker. But the said cheque was dishonored for the reasons "Refer to Drawer". Thereafter, the complainant issued a demand notice to the accused through its counsel by RPAD calling upon him to pay the cheque amount. Inspite of issuance of the notice, the accused neither reply to the notice nor paid the cheque amount. As such, the accused have committed an offence punishable under section 138 of N.I.Act. Hence, the present complaint came to be filed before this court.
14. In support of the case, the complainant's have examined its Director/Foreman as P.W.1 and 18 documents were marked at Ex.P.1 to 18. In the chief examination P.W.1 has repeated the contents taken by the complainant in the complaint. Ex.P.1 is the cheque issued by the accused in favour of the complainant on 09.01.2020 for Rs.4,40,000/-. Ex.P.1(a) is the signature of the accused. Ex.P.2 is the bank memo dated: 10.01.2020 informing the dishonor of the cheque as C.C.NO.28168/2021 7 Refer to Drawer. Ex.P.3 is the office copy of legal notice dated: 01.02.2020. Ex.P.4 is the postal receipt. Ex.P.5 is the returned postal cover. Ex.P.5(a) is the returned notice. Ex.P.6 is the resolution. Ex.P.7 is the certified copy of the incorporation certificate. Ex.P.8 is the complaint. Ex.P.9 is the application for enrollment. Ex.P.10 is the chit agreement. Ex.P.11 is the guarantor form. Ex.P.12 is the surety proposal form. Ex.P.13 is the on demand promissory note. Ex.P.14 is the chit auction minute. Ex.P.15 is the ledger extract. Ex.P.16 the certificate under section 65(b) of Indian Evidence Act. Ex.P.17 is the Income tax return for the period 2014-15. Ex.P.18 is the PAN card. (Ex.P.17 & 18 are got marked through DW.1).
15. The accused in order to prove his defence, he has examined himself as DW.1 and no documents were marked on his behalf. In his evidence he has deposed defence taken by him.
16. The accused has taken the contention that he had not issued any cheque in favour of the complainant company. Further the sister of the accused had issued the cheque one Mr.Ravi Kumar for the purpose of registration of the vehicle. Further the complainant's have misused the said cheque colluded with the said Ravikumar and filed this false complaint against the accused. Further he contended that he has never admitted regarding repayment of amount and there is C.C.NO.28168/2021 8 no transaction between the complainant and the accused as alleged by the complainant. The accused has specifically denied having agree to repay the amount of Rs.4,40,000/-. The accused in his defence has not seriously disputed Ex.P.1 belongs his cheque and drawn on his bank account.
17. In order to attract the offence punishable under section 138 of N.I.Act, the complainant is firstly required to prove the existence of legally enforceable debt/liability, for which the cheque came to be issued. The learned counsel for the complainant has argued that from the evidence placed on record, the fact that one Sheela.N.N subscribed chit group No.BCT01J-31 conducted by the complainant's branch for the chit value of Rs.5,00,000/- which is payable at Rs.10,000/- each month for 50 months. In an auction Smt.Sheela have offered the highest bid agreeing to forego a sum of Rs.2,00,000/- as a discount was duly confirmed by the complainant and she has received the prized amount by offering guarantors for the due payment. In this context several documents were executed in favour of the complainant for the satisfaction of the company and thereby making the liability of the payment of future monthly installment, in the said context the accused is also one of the surety to the future chit installment due. After receiving the said prized amount, the subscriber was irregular in paying the chit installments and C.C.NO.28168/2021 9 thereafter she became a defaulter inspite of several request of the complainant. The complainant also insist to the accused under the capacity of the surety to make payment. Inspite of repeated request the accused and subscriber failed to make payment. After repeated request and personal visit the accused towards discharge of the said payment, had issued the cheque in favour of the complainant. He further argued that the accused has not denied Ex.P.1 being his cheque drawn on his account. When the signature is not seriously disputed, the presumption under section 139 N.I.Act is to be drawn in favour of the complainant. The accused has failed to elicit anything in the cross examination of P.W.1 to disbelieve the evidence of the said witness. The defence have failed to rebut the presumption under section 139 N.I.Act. The counsel for the complainant further argued that the accused has failed to produce any believable evidence that the cheque in question issued by Smt.Sheela.N.N in favour of Mr.Ravikumar for the purpose of registration of vehicle. He further argued that under section 139 of N.I.Act, there is a presumption that the cheque has been issued for discharge of legally enforceable debt/liability. In the present case, the accused has not disputed Ex.P.1 being his cheque drawn on his account. The said presumption is available to the complainant.
18. Further he has argued that the accused has C.C.NO.28168/2021 10 failed to prove the very fact that the cheque was misused by the complainant colluded with the Ravikumar and filed this false case against him. Moreover, under section 118 of N.I.Act, there is a presumption that the Negotiable Instruments is drawn on the date, for the amount and in favour of the person as shown in it. It is for the accused to rebut the said presumption. But in the case on hand no such evidence forthcoming. It was also argued by him that as per the defence by the accused that his sister had issued the blank cheque to the Mr.Ravikumar for the purpose of payment of registration of the vehicle. As such, very defence of the accused is not believable. The learned counsel for the complainant further argued that while in the course of chit business one Smt.Sheela.N.N who joined the chit group with complainant company for chit value of Rs.5 lakhs and monthly installment of Rs.10,000/- each month for 50 months. In a chit auction subscriber Smt.Sheela.N.N was successful bidder of the said chit group and she received the prize amount from the complainant company, for the future chit installments payment, the accused stood have guarantor to the said chit group and the accused signed the surety proposal form and he undertake to clear the future installments. Further argued that after receiving chit amount from the complainant, the subscriber became a defaulter to pay the monthly C.C.NO.28168/2021 11 installments to the complainant company, inspite of repeated request and demand from the complainant company to the subscriber and the surety both are failed to pay monthly chit installments amount. After repeated request the accused had issued the cheque in question in favour of the complainant. As per the request of the accused complainant presented the said cheque before the bank for encashment. But the said cheque was returned as refer to drawer.
19. The learned counsel for the complainant has filed written argument. In his argument he has reiterated the facts of the case. Further submits that the complainant has produced Ex.P.1 to 18 relevant to proved the accused is one of the surety under the capacity of surety and the accused has issued the cheque in favour of the complainant for discharge of the chit due installment of subscriber. After the completion of the complainant evidence the accused cross examine the complainant in lengthy and asked to produce all the relevant documents as a chit license, chit agreement, surety form chit account statement, on demand promissory note and all other documents are produced by the complainant and nothing elicited from the mouth of the complainant in support of the defence of the accused and in the cross examination the accused has indirectly admitted that he is one of the surety and he hand over all the paper to her sister.
C.C.NO.28168/2021 12 Apart from this none of them was elicited in the cross examination of PW.1. After closure of the evidence of PW.1, the accused under section 313 statement was recorded and accused adduced the evidence and not produced any documents. Further the accused taken defence that the accused has not signed any documents including the cheque and he further stated that the cheque and other documents are hand over to his sister Smt.Sheela. Further the complainant has cross examined the accused in that cross examination the accused admitted that he received legal notice and admitted he has not replied and not taken any legal action. Further the accused has admitted to produce some documents to support Vakalath signature but till today he has not produced any document before this court. Further the complainant has contended that Ex.P.17 and 18 that is the income tax returns,and the pan card, both the documents were admitted by the accused. In that documents the cheque signature and the accused signature all are one and the same. The accused also undertake before the court to produce his original income tax returns as well as pan card. Inspite of the accused admission he hasn't produced before the this court. This shows that the accused has intentionally changed his signature in the Vakalath and taken a wrong defence that signature not belong to him. The accused himself has signed the documents C.C.NO.28168/2021 13 like chit agreement and other documents and also he has issued the cheque, in that cheque signature also all are one and same and it belong to accused. Hence, it is crystal clear that the cheque, signature as well as other signature in all exhibits are th accused and he intentionally avoid the liability by giving false evidence before this court by changing his signature.
20. It is further submits that the accused taken another defence in argument that Ex.P.15 document of the Docket sheet/Account statement of the accused name was not mentioned. When more than one surety are there, the company office system software won't take all the names of the surety's to enter and not more than two names cannot be expected by the office system. In this transaction the one surety is Ramaiah and second surety is Lohith Kumar and third surety is Sridhar as such all the surety name was not uploaded in the document of the docket sheet/Account statement. But in all the chit documents the accused name and signature was mentioned. As such for the said reason only the accused name was narrated in the Ex.P.15 on that he was third surety to the subscriber. Further submits that the accused in his argument he has taken another defence that the complainant has not proved legal debt as on the date of issue of the cheque. The complainant has produced the account statement of the chit, in the statement it is clearly C.C.NO.28168/2021 14 mentioned that subscriber is Smt.Sheela.N.N was defaulter to make payment chit installment for the repayment of the said due, the accused issued the cheque in favour of the complainant, hence the complainant has proved the case against the accused. The accused further taken a defence that the liability is a time barred debt. The chit transaction starts on 30.09.2014 for a period of 50 months. After the completion of the chit also subscriber was making some payment. After that subscriber became defaulter. Hence, the transaction is not time barred debt and regarding time barred debt the Hon'ble Supreme Court in Crl.A.No.2743/2023 held that, once the accused has issued the cheque it is a extension of time as per the section 25(3) of the Indian Contract Act. Hence, as per the judgment the present case is not time barred debt. The accused further taken defence that as per the account statement there is no due. This defence taken only at the time of the argument not in the accused evidence nor in the cross of PW.1. Further the account statement was clearly mentioned the due amount along with the interest of the cheque amount will be mentioned. As such, the defence taken by the accused is in correct. The accused has taken a defence that there is no legal debt as per the cheque in the Ex.P.15 Account statement/Docket Sheet, the principle amount due is Rs.3,24,230/- and along with 24% interest per C.C.NO.28168/2021 15 month in total calculated as on the date 09.12.2020 the amount is of Rs.4,40,000/- for the said due amount the accused has issued Ex.P.1-cheque in favour of the complainant. Further submits that chit was started on 30.09.2014 and ended on 30.11.2018. Hence, the transaction is within the limitation period. Further as per the chit fund act section 32 and 33 the complainant already issued the notice to the subscriber and the same was submitted before the Registrar of Chits. The accused was a surety to the subscriber for that the accused signed all the chit papers including the chit surety form, on demand promissory note and other documents. Hence, it is crystal clear that the accused intentionally changed his signature first time before the Vakalaath and taken a false defence that he has not signed the cheque and other papers. Further the accused has admitted to produce certain documents to compare the Vakalath signature but not produced and also the accused undertake to produce the Pan Card and IT returns same also not produced, this shows that the accused has put his signature and taken a false defence before this court. The complainant has proved the case against the accused in all the ingredients of the 138 of N.I.Act. Hence, he prays to convict.
21.The learned counsel for the accused has argued that there was no any legally enforceable debt/liability to the complainant from the accused for C.C.NO.28168/2021 16 which the cheque was issued. Further argued that the accused had not issued any cheque to the complainant for repayment of the due amount. Further argued that the sister of the accused had issued the signed cheque in favour of one Ravikumar for the purpose of registration of vehicle. The complainant have misused the said blank cheque colluded with the said Ravikumar. In order to attract the offence punishable under section 138 of N.I.Act, the complainant is firstly required to prove the existence of a legally enforceable debt/liability, for which the cheque came to be issued. The complainant created all the documents and filed this false complaint against the accused. Further argued that the accused is not a surety to the subscriber and he is not issued any cheque in favour of the complainant. Further argued that in Ex.P.15 the name of the accused was not mentioned, it shows that the accused is not a surety to the said subscriber. It is further argued that the complainant has not proved legal debt as on the date of issuance of cheque. The complainant has produced the account statement of the chit in the statement it is clearly shows that as on the date of issuance of cheque there is no any legal recoverable debt as mentioned the cheque. It is further argued that as per the account statement there is no due from the accused. Further there is no legal debt as per Ex.P.15. It is further argued that the liability is a C.C.NO.28168/2021 17 time barred debt. Hence, case filed by the complainant against the accused is not maintainable. It is further argued that as per the accounts statement there is no due. The accused was not a surety to the subscriber and the accused has not signed any documents and he has not issued any cheque in favour of the complainant. The complainant have failed to prove the case against accused. Further argued that the cheque issued by the sister of the accused in favour of Ravikumar for the purpose of registration of the vehicle as was misused by the complainant colluded with him. Therefore, from the evidence placed on record, the very payment of chit amount to the Smt.Sheela is not clearly made out whereas the accused is succeeded in rebutting the presumption available under section 139 of N.I.Act regarding existence of legally enforceable debt.
22. The learned counsel for the accused further argued that the accused has specifically denied having agree to repay the amount of Rs.4,40,000/- to the complainant. The learned counsel for the accused further argued that PW.1 in his chief examinations reiterated the above narrated averments of the legal notice and complaint. The accused denied the complaint averments. The accused took up contention that his sister had issued the cheque to the Ravikumar for the purpose of registration of vehicle. Further the C.C.NO.28168/2021 18 accused took up a contention and proved that the subscriber has paid the installments, hence he is not liable to pay the amount covered under the cheque. Further argued that the complainant miserably failed to prove the complaint averments. The complainant unable to prove that subject cheque was issued in discharge of duly enforceable debt/liability. The complainant has not come with a clean hands before this court. Indubitably, Ex.P.15 the document relied by the complainant would indicate that as on the date of presentation of cheque or issuance of the cheque the subscriber was not due of amount as mentioned in the cheque. Further as on the date of the presentation of the cheque subscriber and the accused is not in due of Rs.4,40,000/- to the complainant. The complainant in order to harass to the accused fill up the cheque and presented to the bank. Hence, the accused is not liable to pay the cheque amount.
23. It is further argued that the evidence placed before this court clearly shows that the complainant in order to make illegal monetary gain has presented the cheque given by the sister of the accused to the Ravikumar for the purpose of registration of the vehicle, by filing up the cheque, and for the purpose of this case he has created documents and no transaction has been carried out between the complainant and the accused as alleged in the complaint. Hence, the C.C.NO.28168/2021 19 accused proves that the cheque was issued by his sister for the purpose of registration of the vehicle and not to discharge any legally enforceable debt/liability. For offence under section 138 of N.I.Act to attract, the accused must have issued the cheque to discharge any legally enforceable debt/liability. But in the present case, since there is no due amount from the accused thus there lies no legally enforceable debt. Also the accused has successfully managed to rebut the evidence of the complainant with detailed cross examination, thereby rebutting the presumption under section 139. On the date of presentation of the cheque, the accused/subscriber was not in due of Rs.4,40,000/-. The complainant has not produced any material to show that when the subscriber defaulted monthly installments before presentation of the cheque. Thus the complainant failed to prove that the accused had issued the subject cheque for Rs.4,40,000/-. The complainant has misused the cheque obtained from the Ravikumar. Therefore, the complaint averments are concocted and the accused issuing the subject cheque is far away from truth. The complainant unable to prove beyond reasonable doubt that the accused had issued the cheque to them in lieu of liability recoverable debt. Further the accused created doubt against the story putforth by the complainant in the complaint. The pharse "debt or other liability" means a legally C.C.NO.28168/2021 20 enforceable debt or other liability. There was no convincing evidence from the complainant's side as to existence of any existing debt/liability to be discharged by the accused. The accused has discharged the onus that the subject cheque was not received by the complainant for any existing debt/liability. Hence, the accused entitled to acquittal. The complainant having received the subject cheque from the Ravikumar and it has misused the subject cheque by filing huge amount. The alleged balance amount remains unexplained. The complainant has miserably failed to prove the liability to the tune of the amount covered by the cheque. The offence is deemed to be committed if amount covered by cheque is either in discharge of the liability incurred by the accused either full or in part. It cannot be any way in excess of the liability incurred. Therefore, the section 138 of N.I.Act cannot be said to be applicable. Hence, he prays to acquit the accused.
24. In the proceedings for dishonor of cheque under section 139 of N.I.Act a presumption can be raised that when a cheque is issued, it was drawn for discharge of legally enforceable debt/liability. The presumption under section 139 of the act does include the existence of legally enforceable debt/liability. This is in the nature of a rebuttable presumption and it is opened to the accused to raise a defence wherein the existence of a legally enforceable debt/liability can be C.C.NO.28168/2021 21 contested. However, there is initial presumption which favours the complainant. The test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused cannot be excepted to discharge an unduly high standard of proof. In the absence of the compelling justifications, revers onus clauses usually impose an evidentary burden and not a persuasive burden. It is settled position that when an accused has to rebut the presumption under section 139 of the Act, the standard of proof for doing so is that of preponderance of probabilities. Therefore, if the accused is able raise a probable defence which creates doubts about the existence of a legally enforceable debt/liability, the prosecution can fail. The accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence on his own.
25. In the case on hand the very liability of the accused to pay an amount to the complainant is seriously disputed. The accused has contended that he had not issued any cheque in favour of the complainant for repayment of the amount. Further contended that his sister had issued the cheque to the Ravikumar for the purpose of registration of vehicle. Further he has contended that the complainant misused the said C.C.NO.28168/2021 22 cheque colluded with the said Ravikumar and filed this false case. He denies any amount being due by him. He also denies issuance of the cheque for repayment of the amount on 09.10.2020.
26. To prove the factum of the case the complainant produced oral evidence of PW.1 alone and produced Ex.P.1 to 18 only. The documents produced by the complainant does not disclose that the subscriber and the accused is due of Rs.4,40,000/- as on the date of issuance of the cheque. In the said circumstances the complainant required to prove the very due amount by the accused and how an amount of Rs.4,40,000/- is still due. The complainant's have examined its Director/Foreman as PW.1. In his evidence has repeated the contentions taken by the complainant in the complaint. In all 18 documents are produced at Ex.P.1 to 18. The accused has denied issuance of the cheque-Ex.P.1 in favour of the complainant for discharge any legally enforceable debt/due. Therefore, it is necessary to discuss the evidence regarding the due amount by the accused to the complainant and the said amount still due from the accused/subscriber. Since the complainant claims that the accused in order to repayment of debt/due had issued the cheque-Ex.P.1 on 09.10.2020 in favour of the complainant, the complainant firstly required to produce evidence in this regard. But as above C.C.NO.28168/2021 23 discussed no material is placed on record to established the said facts by producing the books of account, credit and debit statement for payment installment and other related documents. So also though the company maintained record regarding the amount due by the accused/subscriber no such material is produced in this case. How the amount of Rs.4,40,000/- is due from the accused as on the date of issuance of the cheque has not been properly explained. Because the complainant have not shown what was the amount due from the accused/subscriber and how this figure came to be arrived as still due from the accused/subscriber. In this case the complainant have produce the chit ledger as per Ex.P.15. On perusal of the same it indicate that there is no any due amount from the subscriber as on the date of presentation of the cheque. Further as on the date of the presentation of the cheque the accused/subscriber was not in due as mentioned in the cheque. Further the complainant have not produced any material to show that when the subscriber defaulted monthly installments. When the accused/subscriber was not in due as mentioned in the cheque as on the date of presentation of the cheque, then question of issuance of cheque-Ex.P.1 on 09.10.2020 in favour of the complainant company does not arise at all.
C.C.NO.28168/2021 24
27. When the complainant is a company maintaining account of all its transaction, it was required to produce some documents with regard to due/debt of the accused/subscriber. Further the complainant not produced books of account, proper ledger statement maintained by the complainant prescribed under chit funds Act to prove that facts. The failure to produce these materials creates doubt regarding existence of legally enforceable debt. As observed in the judgment reported in 2012 Crl.L.J NOC 568, between Ashok Leyland Finance Limited V/s State of Rajasthan and another, the Hon'ble Rajasthan High Court held that on the failure of the complainant to produce the loan papers and account statement which are in their possession it amounts to the presumption available under section 139 of N.I.Act, being rebutted by the accused.
28. It is pertinent to note that the complainant have not produced documents relating to the actual amount in due at the time of issuance of disputed cheque. Here, undisputedly the complainant is a private limited chit and finance company. It has to carry on the business in accordance with law. In these circumstances it is quite reasonable to expect the books of accounts maintained by the complainant which throw light on the account of the subscriber and due of any amount by the subscriber during the year C.C.NO.28168/2021 25 2020 as on the date of issuance of subject cheque. The said documents are having direct bearing on the case, as the said documents who the amount in due by the said accused and the complainant have establishes the case that the accused had issued the disputed cheque towards legally enforceable debt. The said documents is withheld by the complainant without offering any plausible explanation. Since the complainant withheld the relevant documents, the production of which directly establishes its case results in drawing adverse inference against the complainant and the said omission to produce relevant documents fortifies the defence version of issuing cheque by the sister of the accused to the Ravikumar for the purpose of registration of vehicle. Further the complainant have not explained how this amount is came to be due and why the complainant are not mentioned in the ledger statement, what is the interest amount and principle amount. It shows that cheque in question was not issued by the accused to the complainant for repayment of due amount.
29. Moreover the contention by the complainant and their case it is reveals that the accused is one of the surety to Smt.Sheela, the said subscriber subscribed chit group amount of Rs.5,00,000/-. The subscriber has successfully bidding the chit and had received the prized amount from the complainant.
C.C.NO.28168/2021 26 Further the accused is well know to the complainant. Further the subscriber and the accused had became a defaulter in repayment of the said amount. The complainant representative have contacted the accused and requested him for repayment of the said amount. Hence, the accused had issued the cheque in question in favour of the complainant and assured that the said cheque would be honored on its presentation. Further from the evidence produced by the complainant the very fact that the accused is a surety and in order to repayment of due amount the accused had issued the cheque in question. But the complainant have not proved by any reliable evidence. The exact amount still due by the accused/subscriber is not clearly forthcoming. Further the complainant have failed to produce any documents for due amount from the accused/subscriber. So also the cheque in question being issued for the amount due by the subscriber has not been established. Though there is an initial presumption under section 139 of N.I.Act, if the accused from the cross examination raise some reasonable doubt, the said presumption can be held to have been rebutted.
30. In proceedings under section 138 of N.I.Act the standard of proof required by the accused to rebut the presumption is not so high. It is sufficient, if the accused by way of preponderance of probabilities C.C.NO.28168/2021 27 creates doubt regarding very existence legally enforceable debt/liability. The learned counsel for the accused has submitted that when the cheque is issued for uncertain liabilities the offence under section 138 of N.I.Act, is not attracted. Further the accused if reasonably produces evidence to probables his defence, it is sufficient to discharge presumption. Then the burden is on the complainant to produce probables evidence. But in the case on hand as already above discussed except producing some documents and P.W.1 oral evidence no material is produced by the complainant to prove the issuance of the cheque in order to discharge of liability. While on the other hand the accused has show that the cheque was not given to the complainant for repayment of due.
31. In the judgment reported in 2011 ALL MR (Crl) 1922, in the case of "Bhalla Automobiles V/s Rajesh S/o Rambhau Maurya", the Hon'ble court has discussed that the complainant has to take all grounds available to him at the filing of the complaint and he cannot be permitted to change his stand at different times. In such circumstances the accused is entitled for benefit of doubt.
32. In the case of Krishna Janardhana Bhat V/s Dattatreya Hegde, reported in AIR 2008 SC 1325, the Hon'ble Apex Court held that the accused not required to step into witnesses box, he may discharge his C.C.NO.28168/2021 28 burden on the basis of materials already bought on record. He can rely on the materials already on record. It was further observed that the standard of proof to prove the defence is preponderance of probabilities. Thus from the above discussion and placing reliance on the judgments noted above this court is of the opinion that the accused has succeeded in rebutting the initial presumption available to the complainant under section 139 of N.I.Act. When there is no other material produced by the complainant to support its contention for repayment of amount the accused had issued the cheque-Ex.P.1, the complainant failed to prove the material ingredients of legally enforceable debt. Question whether statutory presumption rebutted or not, must be determined in view of other evidence on record.
33. If the accused succeeds in rebutting the presumption, the onus of proving the existence of legally enforceable debt for which the cheque was issued will be on the complainant. But in the case on hand the complainant's have failed to produce any evidence in order to prove that the cheque-Ex.P.1 was issued for discharge of legally enforceable debt. Whereas the accused has succeeded, in rebutting the initial presumption available in favour of the complainant. In the said circumstances the defence have succeeded in discharging his burden of rebutting C.C.NO.28168/2021 29 the said presumption. Thus from the above discussion and placing reliance on the judgment noted above this court is of the opinion that the accused have succeeded in rebutting the presumption available to the complainant under section 139 of N.I.Act. When there is no other material produced by the complainant to support of their contention, the complainant have failed to prove the material ingredients of existence of legally enforceable debt. The discussion supra manifest that the version of defence is a probable one and worth acceptable. Thus by raising a probable defence the accused successfully rebutted the legal presumption raised in favour of the complainant and thereby shifted the anus of proof to the complainant to demonstrate the existence of legally recoverable debt as claimed, but in the instant case the complainant utterly failed to discharge the shifted onus. In this background, I answer point No.1 in the Negative.
34. POINT NO.2: According to the complainant the cheque-Ex.P.1 when it was presented the bank for encashment same was returned dishonor for the reasons "refer to drawer". To prove this fact the complainant's have produced the cheque-Ex.P.1, the bank memo-Ex.P.2 and notice-Ex.P.3. On perusal of the bank memo-Ex.P.2 it is disclosed that the cheque- Ex.P.1 was dishonor for the reasons "refer to drawer" in the account of the drawer namely the accused. These C.C.NO.28168/2021 30 facts are also stated in the legal notice-Ex.P.3 and the oral evidence of PW.1. The accused have not seriously disputed the dishonor of the cheque for the reasons "refer to drawer". What has been disputed is the fact that the cheque-Ex.P.1 was not issued by the accused for discharge of any legally enforceable debt/liability. Further his sister had issued the cheque to the Ravikumar for the purpose of registration of vehicle, the complainant have misused the said cheque colluded with the said Ravikumar. Therefore, from the evidence of PW.1 and the documents placed on record, the fact that the cheque-Ex.P.1 came to be dishonored for the reasons "refer to drawer" has been proved by the complainant.
35. In order to attract the offence under section 138 of N.I.Act the cheque has to be issued by the accused which was drawn on an account maintained by his for discharge, in whole or in part of any debt or other liability. Further it is required that when the said cheque presented by the complainant to the bank was returned unpaid by the bank for any of the reasons enumerated in section 138 of N.I.Act. Thereafter the accused had failed to repay the cheque amount inspite of having received a notice demanding such payment within a period of 15 days on receipt of the legal notice. In the present case it is the case of the complainant that the cheque-Ex.P.1 was issued to them on C.C.NO.28168/2021 31 09.01.2020 for clearance of the due amount. The said cheque was presented on the same to the Bangalore City Co-operative Bank Ltd., Avalahalli branch, Bangalore for encashment. Thereafter, the complainant have received the bank memo as per Ex.P.2 on 14.01.2020 informing them that the cheque was dishonored for the reasons refer to drawer of the accused/drawer. Thereafter within statutory period of receipt of the said information the complainant has got issued a legal notice as per Ex.P.3 calling upon him to make payment of the cheque amount. The said notice is shown to have been returned intimation delivered as per Ex.P.5. But the accused has failed to reply to the notice.
36. The accused has nowhere seriously denied the service of notice. However, he does not dispute the address shown on the notice. The requirement of section 138 of N.I.Act is that notice has to be sent to the last known address of the accused. In the case on hand admittedly the notice is sent to the said address furnished by the accused. In the present case the first essential requirement of the existence of legally enforceable debt/liability to the complainant by the accused has not been proved. Hence, the complainant have failed to comply the required mandatory provision of section 138 of N.I.Act. The basic requirement is not C.C.NO.28168/2021 32 established. Accordingly, I answer Point No.2 in the Negative.
37. POINT NO.3: In view of the findings of this court, the essential requirements to attract the offence of section 138 of N.I.Act has not been proved by the complainant and also as there is no sufficient evidence to hold the accused liable for any offence in the present case. Hence, I answer point No.3 in the Negative.
38. POINT NO.4: The complainant has been held to have failed to prove the very transaction with the accused. Hence, the accused is found to be not guilty of the offence charged. In the said circumstances, the accused cannot be directed to pay any compensation. In view of the above discussion, I proceed to pass the following:
:ORDER:
Acting under section 255(1) of Cr.P.C., the accused is acquitted for an offence punishable under section 138 of N.I.Act.
The bail bond of the accused hereby stands canceled.
(Dictated to the stenographer directly on computer typed by her, corrected by me and then judgment pronounced in the open court on 14th day of June 2024) Digitally signed by SOUBHAGYA SOUBHAGYA B BHUSHER B BHUSHER Date:
2024.06.18 11:56:21 +0530 (Soubhagya.B.Bhusher) XXVIII Addl. Chief Metropolitan Magistrate, Bengaluru.
C.C.NO.28168/2021 33 ANNEXURE List of witness examined on behalf of the complainant:
PW.1 : Sri.Rudresh.M.S. List of documents marked on behalf of the complainant:
Ex.P.1 : Cheque. Ex.P.1(a) : Signature of the accused. Ex.P.2 : Bank endorsement. Ex.P.3 : Office copy of legal notice. Ex.P.4 : Postal receipt. Ex.P.5 : Returned postal cover. Ex.P.5(a) : Returned notice. Ex.P.6 : Resolution. Ex.P.7 : Notarized copy of Incorporation certificate. Ex.P.8 : Complaint. Ex.P.9 : Application for enrollment. Ex.P.10 : Chit agreement. Ex.P.11 : Guarantor form. Ex.P.12 : Surety proposal form. Ex.P.13 : Ondemand promissory note. Ex.P.14 : Chit auction minute. Ex.P.15 : Ledger extract. Ex.P.16 : Certificate U/s.65(b) of I.E.Act. Ex.P.17 : Income tax return. Ex.P.18 : Pan Card.
List of witnesses examined on behalf of the accused:
DW.1 : Mr.Shridhar.N.N List of documents marked on behalf of the accused:
-Nil-Digitally signed by SOUBHAGYA
SOUBHAGYA B BHUSHER B BHUSHER Date:
2024.06.18 11:56:29 +0530 XXVIII Addl. Chief Metropolitan Magistrate, Bengaluru. C.C.NO.28168/2021 34 14.06.2024 (Judgment pronounced in the Open Court Vide Separate Sheet) :ORDER:
Acting under section 255(1) of Cr.P.C., the accused is acquitted for an offence punishable under section 138 of N.I.Act.
The bail bond of the accused hereby stands canceled.
XXVIII Addl. Chief Metropolitan Magistrate, Bengaluru.