Bangalore District Court
H. Ananda Murthy vs Jagadeesh on 4 January, 2025
KABC020369562022
IN THE COURT OF THE XXII ADDL. JUDGE, COURT OF
SMALL CAUSES AND ADDL. CHIEF JUDICAL
MAGISTRATE, BENGALURU CITY
(SCCH-24)
Presided Over by Smt. Roopashri, B.Com., LL.B.,
XXII ADDL., SCJ & ACJM,
MEMBER - MACT,
BENGALURU.
Dated: On this day of 4th day of January 2025
CC NO.14074/2022
1. Sl.No. of the Case : C.C.No.14074 of 2022.
2. The date of : 03-03-2022
commission of the
offence
3. Name of the : Sri. H Ananda Murthy
Complainant Aged about 43 years,
S/o Hanumantharayalla M
R/at No.37/27, 4th cross,
Vivekananda Block,
P.G Halli, Malleshwaram,
Bengaluru -560 062.
(By Sri.K.Prasanna Shetty,
Advocate)
4. Name of the Sri. Jagadeesh,
Accused S/o Venkatesh G
Aged about 28 years,
C/o Vasanthamma,
SCCH-24 2 C.C.14074/2022
No.32, Surya Enclave,
4th cross, Abbigere,
B.D.S.L, N.S.R layout,
Bengaluru -560 090.
(By Sri.Harish D.G. Advocate)
5. The offence complained : Under Section 138 of the
of or proves Negotiable Instrument Act.
6. Plea of the accused and : Pleaded not guilty.
his examination
7. Final Order : Accused is found guilty
8. Date of such order for : 04-01-2025
the following
JUDGMENT
This complaint is filed under Sec. 200 of Cr. P. C. for the offence punishable under Section 138 of the Negotiable Instruments Act.
2. It is the case of the complainant that: The accused and complainant are friends since several years. The accused had approached the complainant in the month of January -2020 for a hand loan of Rs.4,00,000/- for his financial necessities. Believing the words of accused, the complainant paid Rs.2,00,000/- by way of cash on 27-01-2020 and further paid Rs.2,00,000/- on various dates through google pay and SCCH-24 3 C.C.14074/2022 also by way of cash, with a condition that the accused has to repay the same within a span of one year.
3. The accused did not pay back the money within the time specified, hence, the complainant made repeated requests to the accused to repay the same. Finally the accused issued cheque no.860214 dated 10- 09-2021 for Rs.4, 00,000/- drawn on Corporation Bank, K.G.F, Robert sonpet Branch, Bengaluru in favour of complainant. As per the instruction, when cheque was presented through his banker i.e., Axis Bank, Malleshwaram Branch, Bengaluru, same was returned dishonor with memo "Funds Insufficient" on 03-11- 2021. Thereafter, the complainant got issued legal notice to the accused on 01-12-2021 through RPAD. The said notice was returned un-served on 07-12-2021 with shara 'Door Lock', " No such number in this address". In spite of the said demand notice the accused has failed and neglected to settle the amount, thus committed offence punishable under Sec.138 of N.I Act.
4. After recording the sworn statement of the complainant and verifying the documents, cognizance was taken against the accused for the offence punishable under Sec. 138 of N.I. Act. The accused on receiving the summons appeared before this Court SCCH-24 4 C.C.14074/2022 through his counsel and enlarged on bail and his plea was recorded. The accused pleaded not guilty and claims to be tried. Hence, case was posted for the evidence of complainant.
5. The complainant got examined himself as PW.1, and got marked documents as Exs.P1 to 8. Then, the case was posted for recording the statement of accused under Sec.313 Cr.P.C. In the statement U/s 313 Cr.P.C., the accused has denied all the incriminating evidence appearing against him and claimed to be tried. The accused did not adduce defence evidence. During the cross-examination of PW.1 the learned counsel for the accused confronted the documents and got marked as Ex.D.1 and 2. Hence, the case was posted for arguments.
6. Heard the arguments and perused the records.
7. The following points arise for my consideration:
1. Whether the complainant proves that accused has committed offence punishable under Sec.138 of N.I. Act?
2. What order?SCCH-24 5 C.C.14074/2022
8. My findings on the above points are as under
Point No.1: In the Affirmative Point No.2: As per final order for the following:
-: R E A S O N S :-
9. POINT NO.1:- This is a private complaint filed under Section 200 of Cr.P.C. for the offence punishable under Section 138 of N.I. Act.
10. It is the case of the complainant that, towards the discharge of legally enforceable debt, the accused has issued cheque bearing No.860214 for Rs.4,00,000/- dated 10-09-2021 and when the cheque was presented for encashment, same was returned with endorsement "Funds Insufficient". Though the said fact was brought to the notice of accused by issuing legal notice but accused has failed to repay the cheque amount.
11. In order to substantiate the contention, the complainant got examined himself as Pw1 and got marked in all 5 documents as ExP1 to Ex.P8. If the documents produced by the complainant are perused, Ex.P1 is the cheque which bears the signature of accused. The accused nowhere has disputed the cheque which relates to his account and he even has not SCCH-24 6 C.C.14074/2022 disputed his signature in the Ex.P1. It is deposed by Pw1 that cheque in question was issued by the accused for discharge of liability. The cheque in question was presented by the complainant through his banker which was returned with memo as per Ex.P2 stating 'Funds in sufficient'. Hence, he got issued legal notice to the accused through RPAD, which is produced at Ex.P.3. The postal receipt is marked at Ex.P.4. The postal cover is at Ex.P5. Copy of Audio recordings in compact disk is at Ex.P6. Printout of whats app chats is at Ex.P7 and Certificate u/Sec. 65 of Evidence Act is at Ex.P8.
12. On careful perusal of the oral and documentary evidence it would go to show that the accused had ad- mitted that signature on the disputed cheque is his own. Hence, once this fact has been acknowledged, Section 139 of the Act mandates a presumption that the cheque pertained to a legally enforceable debt or liability. This presumption is of a rebuttal nature and the onus is on the accused to raise a probable defence. The learned counsel at this juncture has referred judgment reported in criminal Appeal No.1020/2010 between Rangappa Vs. Mohan wherein it was observed that "Once cheque re- lates to the account of the accused and he accepts and admits the signature on the said cheque, then initially presumption as contemplated under Section 139 of the SCCH-24 7 C.C.14074/2022 Negotiable Instruments Act has to be raised by the Court in favour of the complainant. The presumption referred to in Section 139 of the N.I Act is a mandatory presump- tion and not a general presumption, but the accused is entitled to rebut the said presumption. What is required to be established by the accused in order to rebut the presumption is different from each case under given cir- cumstances. But the fact remains that a mere plausible explanation is not accepted from the accused and it must be more than a plausible explanation by way of re- buttal evidence. In other words, the defence raised by way of rebuttal evidence must be probable and capable of being accepted by the Court.
13. The learned counsel in further has referred the judgment rendered in AIR 2001 SC 3897 between Hiten P Dalal Vs. Bratindranath Banerjee wherein also it was observed that "In the case of a mandatory presumption the burden resting on the accused person in such a case would not be as light as it is where a presumption is raised under S. 114 of the Evidence Act and cannot be held to be discharged merely by reason of the fact that the explanation offered by the accused is reasonable and probable. It must further be shown that the explanation is a true one. The words "unless the contrary is proved' which occur in this provision make it clear that the pre-
SCCH-24 8 C.C.14074/2022sumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible. A fact is said to be proved when its existence is directly established or when upon the material before it the court finds its exis- tence to be so probable that a reasonable man would act on the supposition that it exists. Unless, therefore, the explanation is supported by proof, the presumption cre- ated by the provision cannot be said to be rebutted".
14. Hence, when signature in the cheque is admit- ted it shall be presumed unless the contrary is proved that the holder of the cheque received the cheque for the discharge of in whole or in part of any debt or other lia- bility. Now it is for the accused to rebut the presumption with probable defense.
15. It is true that accused has not led his evidence. But if the cross examination of PW.1 is perused, it is the defence taken by the accused that there was no money transaction held between him and the complainant and that at no point of time he had borrowed sum of Rs.4,00,000/- from the complainant and that he had chit transaction with the complainant and in that regard for raising the chit amount in the name of accused, he has issued three blank signed SCCH-24 9 C.C.14074/2022 cheques as security and the complainant by misusing one among the three cheuqes has filed false complaint against him. The accused in further has seriously disputed the service of legal notice to him and contended that since legal notice is not duly served to him, there is non compliance of mandatory requirement as provided under Sec. 138 (b) of NI Act. Hence, complaint is not maintainable and on that score itself the complaint is liable to be dismissed.
16. The PW.1 during his cross examination has deposed that accused is his relative as he happens to be the brother of the wife of his cousin brother and that he know the accused since 5 years and that he is doing colour lab and photography work and earning Rs.50,000/- to Rs.60,000/- p.m and that after deducting his monthly expenses, his monthly savings would be around Rs.30,000/-. Apart from that he has leased the house on monthly rent and drawing income there from and that he is an income tax assessee but has not disclosed the amount paid to the accused in the Income Tax return. It is further deposed by Pw1 that by collecting amount of Rs.2,00,000/- from his father and by collecting rest of the amount from his friends, he had given Rs.4,00,000/- to the accused and that out of Rs.4,00,000/ sum of Rs.30,000/- to Rs.40,000/- was SCCH-24 10 C.C.14074/2022 given to the accused through google pay and balance amount was paid by way of cash.
17. If the entire cross examination of PW.1 is perused, nowhere the accused has disputed the avocation and income of the complainant and has also not disputed the financial capacity of the complainant to lend sum of Rs.4,00,000/ to the accused. When financial status of the complainant is not in dispute, there is no necessity for the complainant to prove his financial to give sum of Rs.4,00,000/- to the accused.
18. Admittedly, the complainant has not produced his income tax returns. When complainant himself has stated that he has not disclosed the disputed loan transaction in the income tax returns, even if complainant had produced his income tax returns it would no way helpful either to the case of complainant or to the case of accused. So far as non disclosure of disputed loan transaction in the income tax returns and its consequence is concerned, at this juncture it would be relevant to refer here the judgment rendered by Hon'ble High Court of Madhya Pradesh in CRR 5263/2018 between Shrimati Ragini Gupta Vs. Piyush Dutt Sharma dated 07-03-2019 wherein the accused has taken the defence that complainant has never disclosed SCCH-24 11 C.C.14074/2022 his source of income in the income tax return and he has never filed his income tax return, therefore it should be presumed that he did not have any source of income. Under the given set of facts the Hon'ble High Court of Madhya Pradesh held that "Mere non-filing of Income Tax Return would not automatically dislodge the source of income of the complainant. Non-payment of Income Tax is a matter between the revenue and the assessee. If the assessee has not disclosed his income in the Income Tax Return, then the Income Tax Department is well within its rights to reopen the assessment of income of the assessee and to take action as per the provisions of Income Tax Act. However, non-filing of Income Tax Return by itself would not mean that the complainant had no source of income and thus, no adverse inference can be drawn in this regard only because of absence of Income Tax Return. Whether there was any loan transaction between the parties or not and whether there was any legally recoverable debt or not, is the subject matter which can be ascertained in the light of entire case led by the parties. Where the accused has failed to satisfactorily explain the circumstances under which the cheque was issued by the accused or misused by the complainant, then it can be safely inferred/ presumed SCCH-24 12 C.C.14074/2022 that cheque was issued in discharge of legally recoverable debt /liability".
19. In Crl. Revision Petition No.1299/2017 between P.Jayashankar Naidu vs. Sri P Lakshamana @ Ganesh the Hon'ble High Court of Karnataka has observed that "When the complainant has stated that he is not in fact a income tax assessee, question of drawing adverse inference against complainant for not producing income tax returns does not arise".
20. Keeping in mind the observation made in the aforesaid rulings, coming to the case in hand , the mere fact that the complainant has not disclosed the disputed loan transaction in the IT returns it would not sufficient to raise doubt regarding the disputed loan transaction and in turn sum of Rs.4,00,000/- lend by the complainant to the accused.
21. So far as the dispute raised by the accused regarding non service of legal notice is concerned, if the evidence both oral and document is perused, the complainant has issued legal notice to the accused through RPAD. The said notice was returned with shara "Door locked" and "No such number returner to sender". In the legal notice the address of the accused is SCCH-24 13 C.C.14074/2022 mentioned as "Jagadeesh, C/o Vasanthamma. No.32, Surya Enclave, 4th cross, Abbigere, BDSL, N.S.R Layout, Bangalore -560 090. The said address and the address mentioned in the cause title of the complaint are one and the same. The learned counsel for accused during the course of cross examination of PW.1 has confronted the Adhaar card and DL of the accused and marked it as Ex.D1. Admittedly, in the Adhaar card and DL the address of the accused is mentioned as "Resident of #06, 3rd cross, Potte Phalli, Near Govt., School, Parandahalli, Kolar-563122. It is the permanent address of the accused. Nowhere the accused has stated that during the year 2020 also he was residing in the address given in the Ex.D1. Further the accused nowhere has stated that at no point of time he had resided in Bangalore. During the cross examination of PW.1 suggestion was posed on behalf of the accused that during the year 2020 for nearly 4 months the accused had served as driver in the vehicle of complainant and towards the salary of the accused, the complainant had transferred sum of Rs.40,000/- through google pay to the accused . The complainant has denied the said suggestion. The complainant is the resident of Bangalore. Hence, the very suggestion posed to the PW.1 stating that accused was working with the complainant as driver would go to SCCH-24 14 C.C.14074/2022 show that accused was also residing in Bangalore on employment, even though his permanent address is at Kolar.
22. The complainant by referring the un-served postal cover at Ex.P5 has admitted that legal notice is not served to the accused since the number is wrongly mentioned in the legal notice but deposed that he has issued the legal notice to the address and location given by the accused himself. Now at this juncture it would be relevant to refer here Ex.P7 i.e., the whatsapp chat held between the complainants and accused. During the cross examination of PW.1, suggestion was posed on behalf of the accused that there was constant chat and conversation held between the complainant and accused. The accused nowhere has disputed the Ex.P7 but only contended that it was an incomplete screen shot of whatsapp chat held between the complainant and accused and the complainant has produced the screen short of whatsapp chat only to the extent which is favorable to the case of complainant by not producing the screen short of entire whats app chat. The accused by posing suggestion to the Pw1 to the aforesaid effect has admitted the conversation as per Ex;P7 held between him and the complainant. So far as the dispute raised by accused regarding the incomplete screen short SCCH-24 15 C.C.14074/2022 of whatsapp chat is concerned, when accused has admitted the conversation held between him and the complainant as per Ex.P7, if it is an incomplete document and if there is any other conversation/ whats app chat held between the complainant and accused, then the accused could have produced the screen short of the said document. The complainant while admitting that he has produced portion of the screen short of the document which is the whats app chat held between the complainant and accused during the year 2021 to 2023 has further deposed that since there was no conversation held between him and the accused other than the period depicted in the Ex.P7, he has not produced the screen short of the rest of the period. Now if really Ex.P7 is an incomplete document and if really there was any other whatsapp conversation/ chat held between the complainant and accused which favors the case of accused, then the accused could have produced the said document before the court because when conversation was held by way of sending messages through whatsapp, the said messages will be in the mobile of the accused and he could have produced the screen short of the said whatsapp chat. Hence, Ex.P7 can very well be relied upon.
SCCH-24 16 C.C.14074/202223. If Ex.P7 is perused, wherein there is whatsapp chat held between complainants and accused and complainant had asked the accused to send his address and location. Accordingly on 15-10-2021, complainant himself sends the address of the accused for verification from the accused. The said address of the accused reads as follows:
"Surya Enclave 4th cross Road, Srikrupa Layout, Abbigere, Abbigere, Bengaluru -560015.
24. The accused having received the said message confirmed that the said address is the correct address. Thereafter the complainant send one more message asking for the house number and PIN number. For which accused forwarded his house number and PIN number as "Door No.32, BDSL NSR Layout, Bangalore 560 090. If the address of the accused mentioned in the legal notice and complaint is compared with the address one confirmed by the accused as his own address in the whatsapp chat, they are the one and same. If really, the address mentioned in the legal notice is the incorrect address of the accused then it can be said that the accused intentionally has given his wrong address to the complainant to see to it that no legal action would be taken against him and for the wrong address furnished by the accused , the complainant cannot be blamed.
SCCH-24 17 C.C.14074/2022Now at this juncture it would be relevant to refer here the bail bond executed by the accused. After registering the case in CC register, summons was issued to the accused. On service of summons the accused appeared before the court on 27-07-2023 and enlarged on bail. In the bail bond executed by the accused which is in the case record, he has mentioned his address which is in consonance with the address mentioned in the legal notice and complaint. Hence, it can be said that address mentioned in the legal notice is the correct address of the accused and to the correct address of the accused only notice was sent through RPAD. When legal notice was sent to the correct address of accused through RPAD, presumption shall be drawn u/Sec.27 of the General Clauses Act regarding due service of legal notice. Now at this juncture it would be relevant to refer here the judgment relied by the learned counsel for complainant rendered in Crl.,Revision Petition No.814/2021 between C. Niranjan Yadav Vs. D. Ravi Kumar wherein it was observed that "the object of issuing legal notice u/Sec. 138 of NI Act is to protect a bonafide drawer of cheque. It was not the intention of the legislative that the moment a cheque is bounced, drawer of said cheque cannot be presumed as dishonest in each and every case. At times there may be genuine SCCH-24 18 C.C.14074/2022 reason for non hounoring the cheque by the banker of the drawer. Therefore, to protect such drawer, who is honest enough in honuoring its commitments, should be given a chance to rectify the mistake on account of dishonour of cheque. While looking in to the proper service of notice the court has to see whether the address of the accused which is known to the complainant has been properly mentioned in the registered cover. If it is sent through such registered address, responsibility of the complainant would end and it is for the accused to say as to why he could not receive the cover.
25. When complainant has issued legal notice to the address furnished by the accused himself , the mere fact that during the cross examination the PW.1 has admitted that the PIN number and house number is wrongly mentioned in the notice, the court cannot discard the entire case of the complainant. When as observed in the aforesaid judgment, the purpose of issuing notice is to save the bonafide drawer of the cheque, nothing prevented the accused to pay the money after he appeared before the court. Hence, it can be said that notice is duly served to the accused.
SCCH-24 19 C.C.14074/202226. The accused while admitting the Ex.P1 relates to his account so also his signature in the Ex.P1 has contended that he has issued three blank cheques with respect to the chit transaction as security for raising chit amount in his name. The accused nowhere has posed suggestion to the PW.1 that the rest of the writings except his signature are in the hand writing of the complainant. When accused has stated that he has given blank signed cheque, it is useful to refer here the judgment relied by the learned counsel for complainant reported in AIR 2019 SC 2446 between Bir Singh Vs. Mukesh Kumar wherein it was observed that "If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence.
27. Hence, even a blank cheque leaf voluntarily signed and handed over by the accused which is towards some payment, would attract presumption u/Sec. 139 of the NI Act in the absence of any cogent evidence to show that cheque was issued in discharge of debt.
SCCH-24 20 C.C.14074/202228. Coming to the material defence taken by the accused as to the issuance of disputed cheque as security for the chit transaction is concerned, it is the suggestion posed to the PW.1 on behalf of accused that, the accused had chit transaction with the complainant and for raising chit amount in the name of accused, he has issued three blank cheques and the complainant has misused one of the cheque and filed the false complaint. It is nowhere stated by the accused the year in which he has given the disputed cheque as security and what total chit amount etc was. The complainant has denied his running any chit business and accused being the subscriber. The complainant while admitting that accused has given two blank signed cheques , further deposed that complainant has financially assisted the accused during his marriage and for the repayment of the said amount, the accused has issued disputed cheque as security. The PW.1 further deposed that since accused failed to repay the amount borrowed, at the intervention of well wishers, the accused agreed to invest money in the chit business by paying Rs.10,000/- per month and the complainant was using the said amount in the chit business with the others in the name of accused and accused agreed to repay the amount of Rs.4,00,000/- received by him from the complainant out SCCH-24 21 C.C.14074/2022 of the chit amount invested with others. The complainant has admitted sum of Rs.40,000/-received by him from the accused as per Ex.D1 towards payment of chit subscription raised in the name of accused with others. Though the accused has stated that he has transferred sum of Rs.90,000/- to the complainant towards the said chit transaction but if Ex.D1 is perused, only sum of Rs.40,000/- was transferred through google pay in the name of complainant. As observed supra, complainant has admitted the transfer of Rs.40,000/- from the accused but stated that the said amount was towards the subscription of chit which was made in the name of accused with others as accused has invested money in the chit business so as to repay the loan amount of Rs.4,00,000/- received by him from the complainant.
29. If Ex.P7 is perused, wherein there is reference about the chit business and also reference about the amount borrowed by the accused from the complainant and the time sought by the accused for repayment of the said amount to the complainant and there is also exchange of whatsapp messages regarding payment of amount to the accused by the complainant by borrowing money from finance and due to nonpayment of amount by the accused the complainant had to pay interest to SCCH-24 22 C.C.14074/2022 the financier etc. Hence, from the Ex.P7 it can be gathered that the accused has borrowed sum of Rs.4,00,000/- from the complainant and towards the discharge of said debt, he has issued Ex.P1 which was returned as Insufficient Fund. Though the accused has denied the passing of the consideration but bare denial of the passing of the consideration does not appear to be any defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the complainant. Hence, it can be said that accused has failed to rebut the presumption by not probablising the defence taken by him.
30. In the light of the discussion made herein above, this court is of the considered opinion that complainant has proved that accused has committed offence punishable under Section 138 of Negotiable Instruments Act. Accordingly, I answer point No.1 in the affirmative.
31. POINT No.2 :- The Negotiable Instruments Act is a Special Enactment, and the provisions of the Act prevail over the general provisions contained in Code of Criminal Procedure. Therefore, keeping the relevant provisions of the Act in mind the sentence is to be SCCH-24 23 C.C.14074/2022 passed. In the light of the reasons on the point No.1, I proceed to pass the following;
32. POINT No.2 :- In the light of the reasons on the point No.1, I proceed to pass the following;
ORDER Acting under Sec.255 (2) of Cr.PC, the accused is found guilty of the o/p/u/s 138 read with section 142 of NI Act and he is sentenced to pay fine of Rs.4,10,000/-
(Rupees Four lakh Ten thousand only) out of which Rs.4,05,000/- shall be paid as compensation to the complainant under Sec.357 of CRPC and Rs.5,000/- shall be payable to the State.
In the event of default in payment within a period of 2 months, the accused shall be convicted to simple imprisonment for a period of 3 months.
The bail bond of accused and that of surety stands cancelled.
SCCH-24 24 C.C.14074/2022Supply free copy of the judgment to the accused.
(Dictated to the stenographer directly on computer, corrected and then pronounced by me in open court, on this the 4 th day of January 2025.) (ROOPASHRI) XXII Addl.SCJ & ACJM Bengaluru.
:ANNEXTURE:
LIST OF WITNESSES EXAMINED ON BEALF THE COMPLAINANT P.W.1 : H Ananda Murthy LIST OF DOCUMENTS MARKED ON BEHALF COMPLAINANT:
Ex.P.1 : Original Cheque on 10-09-2021 Ex.P.1(a) : Signature of the accused.
Ex.P.2 : Endorsement
Ex.P.3 : Copy of legal notice.
Ex.P.4 : Postal Receipt
Ex.P.5 : Postal cover
Ex.P.6 : Copy of audio recordings in
compact disk
Ex.P7 : Printout of whatsapp chats
Ex.P.8 : Certificate U/Sec.65 B of Evidence
Act.
LIST OF WITNESSES EXAMINED BY THE ACCUSED
- None -SCCH-24 25 C.C.14074/2022
LIST OF DOCUMENTS MARKED ON BEHALF OF ACCUSED:
Ex.D1 - Xerox copy of Aadhar card and DL of the accused Ex.D2 : - Down load copy of google pay history XXII Addl. SCJ & ACJM Bengaluru.