Bangalore District Court
Sri.Nagarajaiah vs Sri.Ramachandraiah on 4 May, 2023
KABC030360362019
THE COURT OF XX ADDL.CHIEF METROPOLITAN
MAGISTRATE AT BENGALURU CITY
PRESENT: BHOLA PANDIT,
B.Com.,LL.M.,
XX ADDL. C.M.M.
Bengaluru.
Dated this the 4th day of May 2023
C.C.No.11309/2019
Complainant : Sri.Nagarajaiah,
S/o late Kencha Rangaiah,
Age 53 years,
R/at.No.4, 1st Main Road,
Sanjivini Nagar,
Hegganahalli Cross,
Near Anjenya Temple,
Bengaluru- 560 091.
{ By Sri.T.H.Prasannakumar - Advocate }
Vs.
Accused : Sri.Ramachandraiah,
C/o Rangaswamaiah,
Age 52 years,
R/at.No.101,
2nd A Cross,
2 C.C.11309/2019
5th Block, Nagarabhavi 2nd Stage,
Bengaluru- 560 078.
And also at:-
Kalkere Village,
Thippasandra Hobli,
Dddamudigere Post,
Magadi Taluk,
Ramanagar District.
{ By Sri.T.S.Gopinath - Advocate }
Offence complained : U/S. 138 of N.I. Act.,
Plea of accused : Pleaded not guilty
Final Order : Accused is Convicted
Date of Order : 04-05-2023
JUDGMENT
The present complaint is filed under section 2(d) read with section 200 of code of criminal procedure against the accused seeking to punish him for the offence punishable 3 C.C.11309/2019 under section 138 of the Negotiable Instruments Act ( in short referred as "N.I. Act").
02. The alleged facts in the complaint are summarized as under;
It is averred in the complaint that, the complainant and accused are childhood friends and have a very good relationship. In order to meet out his domestic needs and financial crises, the accused had availed hand loan of Rs.5,00,000/- from the complainant by way of cash and in the second week of May 2016 and had agreed to repay the same within two years. It is further alleged that, to repay the hand loan amount, the accused has issued a cheque bearing No.551593 dated 14.12.2018 for a sum of Rs.5,00,000/- drawn on ICICI Bank, Vijayanagara Branch, Bengaluru in favour of the complainant. On the same day, the complainant has presented the said cheque for encashment through his banker, but it returned 4 C.C.11309/2019 unpaid with banker's endorsement dated 11.03.2019 as "Account Closed". On 28.03.2019, demand notice was issued to the accused by RPAD, but even though the accused residing in the same address, he has managed to sent back the said notice as ' insufficient address ' . Thus, it is sought to convict the accused for the offence punishable under section 138 of NI Act and grant compensation as per section 357 of Code of Criminal Procedure.
03. On presentation of complaint, this court has verified the averments of complaint along with records and thereby had taken cognizance for the offence punishable under section 138 of NI Act. Thereby, as per the verdict of the Hon'ble Apex court reported in AIR 2014 SC 2528 in the case of Indian Bank Association and others V/s Union of India and others, the sworn statement of the complainant has been recorded as PW.1 and got exhibited seven documents at Ex.P.01 to 07. Having been made out 5 C.C.11309/2019 the prima-facie case, the complaint has been registered in Register No. III and issued process against the accused.
04. In response to the summons, the accused put his appearance before the court through his counsel and filed bail application under section 436 of Code of Criminal Procedure, the accused has been enlarged on bail. The substance of accusation has been recorded and read over to the accused, he pleaded not guilty and put forth his defense. On filing application by the complainant under section 145(1) of NI Act, sworn statement of the complainant has been treated as examination in chief. Similarly, on filing application under section 145(2) of NI Act, the accused has been permitted to cross examine PW.1. On completion of the trial of the complainant's side, the statement of accused under section 313 of Code of Criminal Procedure has been recorded and read over to the accused, the incriminating material found in the trial of the case of 6 C.C.11309/2019 the complainant. The accused has denied the same in toto and the accused also wants to lead his defense evidence, but the accused did not has entered in the witness box to substantiate his defense.
05. Heard the Learned counsel for complainant. No argument addressed on behalf of the accused. Perused the materials available on record.
06. The following points that arise for my consideration are as under;
POINTS
1. Does the complainant proves beyond reasonable doubts that, the accused has issued a cheque cheque bearing No.551593 dated 14.12.2018 for a sum of Rs.5,00,000/- towards the discharge of his lawful liability of the complainant and when the said cheque was presented for encashment, which were returned unpaid due to "Account Closed" in the account of the drawer as per banker's memo and inspite of issuance of demand notice , the 7 C.C.11309/2019 accused has failed to pay the cheque amount, thereby has committed the offence punishable under section 138 of NI Act?
2. What Order or sentence ?
07. My findings to the above points is as follows;
1. Point No.1: In the affirmative
2. Point No.2: As per final order for the following;
REASONS
08. POINT No.1: It is the specific case of the complainant that, the accused has availed hand loan of Rs.5,00,000/- and towards discharge of the said hand loan amount, the accused has issued the disputed cheque and when the said cheque was presented for encashment, it returned unpaid due to "Account Closed" in the account of the drawer.On 28.03.2019, demand notice was issued to the accused by RPAD, but even though the accused residing in the same address, he has managed to sent back the said 8 C.C.11309/2019 notice as ' insufficient address '. Hence, the present complaint filed against the accused for the offence punishable under section 138 of NI Act.
09. To substantiate and establish this fact before the court beyond reasonable doubts as per the verdict of the Hon'ble Apex court in the case of Indian Bank Association and others V/s Union of India and others , the sworn statement of the complainant has been treated as affidavit evidence. In his affidavit evidence, PW.1 has replicated the averments of the complainant. To corroborate the evidence of PW.1, the complainant has placed on record in all seven documents as per Ex.P.01 to 07. Ex.P.1 is the disputed cheque dated 14.12.2018 , Ex.P.1 (a) is the signature of accused, Ex.P.2 is the banker's memo dated 11.03.2019, which shows the reasons for the return of the cheque at Ex.P.1 for unpaid is as "Account Closed" , Ex.P.3 is the legal notice dated 28.03.2019 to the accused by RPAD, but 9 C.C.11309/2019 even though the accused residing in the same address, he has managed to sent back the said notice as ' insufficient address ' . Ex.P.4 & 5 are the the postal receipts about sending legal notice at Ex.P.3, Ex.P.6 & 7 are the returned postal covers, and Ex.P.6(a) & Ex.P.7(a) are the notices inside the returned postal covers. PW.1 has been substantially cross examined by the counsel of accused.
10. To disprove the case of the complainant and also to rebut the mandatory presumptions which could be drawn under section 139 of NI Act, the accused did not entered in the witness box and not produced any documentary evidence.
11. It is argued from the prosecution side that, the accused has failed to adduce his evidence and by the oral evidence of complainant coupled with the documents produced at Ex.P.1 to 7, the complainant has proved his 10 C.C.11309/2019 case beyond all reasonable doubts. Accordingly, it is sought to convict the accused.
12. No arguments has been advanced from the defense side.
13. Before to appreciate the oral and documentary evidence relied by the complainant, it is necessary to know as to whether the present complaint is filed in consonance with the provisions of section 138 of NI Act. On perusal of the cheque, banker's memo, demand notice, postal receipts and closed envelops, which are marked at Ex.P.1 to 7, it can be seen that, the cheque at Ex.P.1 was deposited with the bank for encashment within its validity period. On perusal of the demand notice dated 28.03.2019, it can be further seen that, the demand notice has been issued within 30 days from the date of receipt of notice. During cross examination of PW.1, the service of demand notice to the 11 C.C.11309/2019 accused has been denied, but in support of the said denial, no oral substantive evidence is forth coming from the defense side. Ex.P.6 7 7 are the closed postal covers and they returned to the sender as ' insufficient address' and ' no such person'. If these two postal sharas are taken into consideration, it appears that, the demand notice was not sent to correct and proper address of the accused. But, looking to the service of court summons, it is reported by police authority that, the accused has refused to receive the summons. The summons of the court has been sent to the same address of the accused , which has been mentioned in the returned postal covers at Ex.P.6 & 7. Therefore, I am of the considered opinion that, when the accused has refused to receive the court summons, then the postal authorities have made wrong and false shara on Ex.P.6 & 7 colluding with the accused. Therefore, I am of the considered opinion that, the accused knowing the postal authority to mentioning such shara on Ex.P. 6 & 7 12 C.C.11309/2019 and he had the knowledge about sending these two notices to his personal and correct address. Therefore, by considering all the material documents at Ex.P.5 to 7, it can be seen that, there is a clear observation of legal provisions contemplated under section 138 of NI Act. Hence, the present complaint filed in compliance of section 138 of NI Act.
14. Sections 118(a) & 139 of NI Act are two important provisions and they provides for raising mandatory presumptions in favour of the complainant until the contrary is proved by the accused. Even in the catena of decisions i.e., in the case of Rangappa Vs. Mohan reported in 2010(11) SCC 441, in the case of Bir Singh Vs. Mukesh Kumar reported in 2019(4) SCC 197, in the case of APS Forex Services (P) Ltd., Vs.Shakthi International Fashion Linkers reported in 2020(12) SCC 724, in the case of Rajeshbai Muljibhai Patel Vs. State of Gujarat, 13 C.C.11309/2019 reported in 2020(3) SCC 794, in the case of Triyambak S. Hegde Vs. Sripad reported in Live Law 2021 SC 492 and in the relied judgments it is laid down that, " Once the issuance of cheque and the signature thereon is admitted by the accused, the court is required to raise presumption in favour of the the complainant stating that, the accused has issued the cheque for some consideration towards discharge of his legal debt or liability of the complainant and that the complainant is the due holder of the said cheque. The burden or reverse onus shifts on the accused to rebut the statutory presumptions under sections 118(a) & 139 of NI Act." Now, it is well established law that, the presumption mandated by section 139 of NI Act, thus indeed includes the existence of legally enforceable debt or liability and it is open for the accused to raise a probable defense wherein the existence of legally enforceable debt or liability can be contested and he shall prove before the court on preponderance of probabilities, only thereupon a 14 C.C.11309/2019 statutory presumption raised in favour of the complainant stands rebutted.
15. The judgment reported in P.Rasiya Vs. Abdul Nazer in Crl.Appeal No.1233 to 1235 of 2022 decided on 12.08.2022, it is held by the Hon'ble Apex Court that;
" Once the initial burden is discharged by the complainant that the cheque was issued by the accused and the signature and the issuance of the cheque is not disputed by the accused, in that case, the onus will shift upon the accused to prove the contrary that the cheque was not for any debt or other liability. The presumption under section 139 of NI Act is a statutory presumption and thereafter, once it is presumed that the cheque is issued in whole or in part of any debt or other liability which is in favour of the Complainant/holder of the cheque, in that case, it is for the accused to prove the contrary."
In the instant case on hand, un-disputedly the accused did not given any reply notice to the demand notice sent under Ex.P.3, thereby the accused has failed to put forth his defense in the beginning itself. In the case on 15 C.C.11309/2019 hand, the Learned Defense Counsel has cross examined PW.1 and during his cross examination on page No.8, he put forth his defense contending that, the accused had a financial transaction with one Shankare Gowda used to handed over to the said Shankare Gowda some of his cheques and through Shankare Gowda, the complainant took the cheque at Ex.P.1 and thereby has filed this false case against him. Though, this suggestion has been denied by PW.1, but considering this suggestion made to PW.1 it clearly goes to show that, the accused is admitting his issuance of cheque and his signature there on at Ex.P.1 and Ex.P.1(a). thus, the statutory presumptions under sections 118(a) & 139 of NI Act shall go in favour of the complainant. Now, the burden shifts on the accused to rebut the statutory presumption under section 118(a) & 139 of NI Act. It is well settled law that, to rebut the statutory presumption under section 118(a) & 139 of NI Act, the accused shall raise probable defense and thereby to prove 16 C.C.11309/2019 the same on preponderance of probabilities. To rebut the statutory presumption under section 118(a) & 139 of NI Act, the accused may produce his own evidence or he may rely upon the evidence culled out during the cross examination of PW.1. Admittedly, the accused did not enter into the witness box, so also not produced any documentary evidence. So, he must rely upon the evidence found in the cross examination of PW.1 to rebut the statutory presumption under section 118(a) & 139 of NI Act. On careful scrutinizing of entire cross examination of PW.1, it has been elicited that, the complainant has not produced any document before the court to show that, in the second week of May 2016 he had an amount of Rs.5,00,000/- with him. It is further elicited from the mouth of PW.1 that, he has not obtained any documents from the accused to witness about lending the disputed hand loan and further cross examination of PW.1 was nothing but the denial of complainant case. The evidence culled out during cross 17 C.C.11309/2019 examination of PW.1, such as about not obtaining any documents from the accused for having advancement of hand loan and also not producing any document from the complainant about his having had of Rs.5,00,000/- in the month of May 2016, these evidences would help the accused only if he successfully rebuts the legal presumptions raised in favour of the complainant. Now, coming to the discussion about the defense put forth by the accused during cross examination of PW.1. It is suggested that, the accused had financial transaction with one Shankare Gowda and used to issue his cheques, but colluding with the said Shankare Gowda, the complainant took cheque at Ex.P.1 from him and has filed false case against him. This suggestion has been denied by the complainant. Except this suggestion made to PW.1 in order to prove the same, no such worth and material evidence has been culled out from the mouth of PW.1 in his further cross examination. Even, the accused did not produced 18 C.C.11309/2019 any iota of documentary evidence to believe his version that, he had financial transaction with the said Shankare Gowda. In the absence of any other material evidence placed before the court, the mere suggestion made to PW.1 in his cross examination shall not be considered as a probable defense to believe the same. thus, the accused has failed to rebut the statutory presumption under section 118(a) & 139 of NI Act drawn in favour of the complainant. Hence, the question of shifting onus on the complainant does not arise at all. Hence, I answered point No.1 in the affirmative.
16. POINT NO.2: In view of the reasons stated and discussed above, the complainant has proved the guilt of the accused punishable under section 138 of N.I. Act It is worth to note that, the offence is of the nature of civil wrong. Hence, it is proper to award sentence of fine, 19 C.C.11309/2019 instead of awarding sentence of imprisonment. Accordingly, this court proceed to pass the following;
ORDER
Acting under section 255 (2) of
Criminal Procedure Code, accused is
hereby convicted for the offence
punishable under section 138 of
Negotiable Instrument Act and
sentenced to pay fine of Rs.6,10,000/-
(Rupees Six Lakhs Ten Thousand
only). In default, he shall undergo
simple imprisonment for 6(Six)
months.
Acting under section 357(1) of
code of criminal procedure, it is ordered that an amount of Rs.6,00,000/-
( Rupees Six Lakhs only), there 20 C.C.11309/2019 from shall be paid to the complainant as a compensation, remaining fine amount of Rs.10,000/- (Rupees Ten Thousand only) is defrayed to the state for the expenses incurred in the prosecution.
The bail bond of accused stands canceled subject to appeal period.
Supply free copy of judgment to the accused.
{ Dictated to the stenographer, transcribed and computerized by her, revised corrected and then pronounced in the open court on this 4 th day of May 2023 }.
(BHOLA PANDIT) XX ACMM, Bengaluru.
ANNEXURE 21 C.C.11309/2019 List of witnesses examined on behalf of complainant:
P.W.1 Sri.Nagarajaiah List of documents produced on behalf of complainant:
Ex.P.1 Cheque
Ex.P. 1(a) Signature of the accused
Ex.P. 2 Bank endorsement
Ex.P. 3 Copy of the legal notice
Ex.P. 4 & 5 Postal receipts
Ex.P. 6 & 7 Returned postal covers
Ex.P.6(a) & 7(a) Notices inside the returned
postal covers.
List of witnesses examined on behalf of accused:
-Nil-
List of documents produced on behalf of accused:
-Nil- Digitally signed by
PANDIT PANDIT S BHOLA
S BHOLA Date: 2023.05.04
18:03:23 +0530
XX A.C.M.M.,
Bengaluru.