Bangalore District Court
U/S 200 Of Cr.P.C For The Offense vs Had Issued 5 Cheques For Security ... on 9 April, 2021
IN THE COURT OF THE XXVIII ADDL. CHIEF
METROPOLITON MAGISTRATE NRUPATHUNGA ROAD,
BENGALURU CITY
Present:- Sri. PRUTHVIRAJ VERNEKAR
B.Com, LLB
XXVIII A.C.M.M
Bengaluru City.
Dated this the 9th day of April, 2021
CC.No.19448/2017
JUDGMENT
1. Sl.No. of the case : C.C.No.19448/2017
2. The date of commence of Evidence: 04.12.2017
3. The date of Institution : 13.10.2016
4. Name of the Complainant :Sri. K.S Narendra, Director, M/s Sansagar Chits Pvt Ltd No.51/1 & 52 1st Floor, 1st Stage, 6th Phase, West of Chord Road, Manjunathnagar, Bangalore-560010.
v/s
5. Name of the Accused : Sri. Shankar .J Aged about 42 years, S/o Sri. D Jayaramu Naidu M/s SAS Star No.80/1, 8th Main road, 6th phase, 1st Stage, West of Chord road, Rajajinagar, CC.No.19448/2017 2 Bengaluru-560010.
6. The offence complained : U/s.138 of N.I. Act
7. Plea of the accused on his examination : Pleaded not guilty
8. Final Order : Accused is Convicted
9. Date of such order : 09.04.2021 JUDGMENT
1. This case has been registered against the accused on the basis of the complaint filed by the complainant u/s 200 of Cr.P.C for the offense punishable u/s 138 r/w 142 of N.I. Act.
2. The gist of the complainant's case is that :
Complainant submits that, the complainant and the accused have been friends and well known to each other from the past several years. The complainant is the Director of M/s Sansagar Chits Pvt Ltd which is a company incorporated under the companies Act, CC.No.19448/2017 3 engaged in the business of chits. The complainant further submits that the accused had subscribed to a chit group of the value of Rs.50,00,000/- payable in 25 monthly installments of Rs.2,00,000/- each vide chit group reg No.H25-1-1-15, ticket No.6 which commenced with effect from 19.01.2015. The accused has entered into an agreement with the complainant agreeying to pay the monthly subscription amount regularly and promptly to the complainant company .
The accused had participated the monthly auction chit held in the 9th month of 20.09.2015 and he bid the chit agreeing to forego a sum of Rs.15,00,000/- and receive the prized chit amount of Rs.35,00,000/- from the complainant company. The complainant company has paid the prized chit amount of Rs.35,00,000/- through two cheques. The accused has executed an On Demand Promissory note on 30.09.2015 in favour of the complainant company. After receiving the prized chit amount, the accused has paid the monthly CC.No.19448/2017 4 chit subscription only for 5 months and subsequently he committed default and not paid the monthly subscription amount to the complainant from March 2016 up to the current month of October 2016. The chit transaction is due to close on 19.01.2017. The accused had issued 5 cheques for security purpose guaranteeing prompt payment of the monthly subscription amount in favor of the complainant as detailed below:
1. 833110 23.08.2016 Rs.1,90,548/- 2.833111 23.08.2016 Rs.1,83,440/- 3.833106 24.08.2016 Rs.1,84,822/- 4.833107 23.08.2016 Rs.1,85,910/- 5.833108 23.08.2016 Rs.1,84,428/-
All cheques drawn on Canara Bank, Kumara Park West branch, Bangalore towards the legally recoverable debt, when the complainant presented the said cheques for encashment through their banker The Karur Vysya Bank Limited, Rajajinagar CC.No.19448/2017 5 branch, Bangalroe the said cheques were returned unpaid on 25.08.2016 with the endorsement 'Funds Insufficient'. Thereafter the complainant intimated the fact of the dishonour of cheques to the accused and demanded the payment of the amount under the dishonoured cheques, inspite of repeated request and demands made by the complainant, the accused has failed and neglected to pay the amount to the complainant company. Hence, the complainant issued a legal notice on 31.08.2016 to the accused by RPAD calling upon the accused to pay the cheque amount within 15 days from the date of receipt of the said notice and the said notice was served to the accused on 01.09.2016 and inspite of service of notice accused has not paid the cheque amount nor replied to the said notice. Accordingly, the complainant filed the complaint against the accused for having committed an offense punishable u/s 138 of N.I. Act on 09.04.2021.
CC.No.19448/2017 6
3. In pursuance of the summons, the accused has appeared through Counsel and got enlarged on bail by executing necessary documents. The copy of the complaint was furnished to the accused, as required under law. As there was sufficient material, plea was recorded against the accused on 18.11.2017 and explained to the accused in his vernacular, for which the accused pleaded not guilty and claims to be tried.
4. In order to prove the case, the Director of the complainant Company Sri. K.S Narendra examined as PW1 and got marked Ex.P1 to 27. Then the statement u/s 313 Cr.P.C was recorded on 16.01.2018, wherein the incriminating evidence appeared against the accused was read over and explained which was denied by the accused. Accused examined himself as DW1 and got marked Ex.D1 and D8 on his behalf.
5. The counsel for the complainant submitted at the time of argument the director of the complainant CC.No.19448/2017 7 company examined as PW1, in his chief examination he has given corroborative evidence and also in order to prove the case of the complainant company got marked the document Ex.P1 to Ex.P27 same are corroborator with the averments made in the complaint. Apart from this accused during his cross examination has admitted Vyshay Bank statement as per Ex.P26 on 10.10.2015 amount of Rs.30,09,776/- is received by the accused and same is deposited in his account and also admitted Ex.P13 to Ex.P17 cheques and his signature Ex.P13(a) to Ex.P17(a). In view of this, as there is a presumption u/s 139 of N.I Act complainant has successfully proved accused has issued Ex.P13 to17 cheques for recoverable debt of the accused and on presentation of the same dishonoured with endorsement 'funds endorsement' as per Ex.P18 to 22. In view of this it is crystal clear that the accused has committed alleged offense against him, hence, pray for punish the accused in accordance CC.No.19448/2017 8 with law. The learned counsel for complainant has placed the following decisions:-
1.AIR 2016 SC 4363 Sampelly Satyanarayana Rao V/s Indian Renewable Energy Development Agency Limited.
2. ILR 2019 Karnataka 1953 - Sami Labs Limited V/s M.V Joseph The learned counsel for the accused filed written argument. In the written argument contended that the complainant and accused have been friends and well known to each other from past several years are false. It is false that accused had participated the monthly auction chit held on 20.09.2015 and he bid the chit agreeing to forgo a sum of Rs.15,00,000/-
from the complainant company. The complainant company paid only a sum of Rs.30,09,776/- and accused was not participated in the chit auction Ex.P26 is produced by the complainant. The accused has issued reply to the legal notice issued by the complainant. The Proprietor to bring the fact on CC.No.19448/2017 9 record but this complainant name of the proprietorship is not mentioned on this ground also case of the complainant is not maintainable. The accused was regular in payment to the complainant company through RTGS . The complainant company has filed another case in same transaction before the Registrar of Chit 4th June Bangalore for amount of Rs.27,28,000/-. The case of the complainant by filing two cases on same cause of action is not maintainable, it amounts to scope of principles of double jeopardy under article 20(2) of Constitution and sec.300 of Crl.PC. Cause of action in case of dishonour of several cheques different dates were dishonoured and with regard to the first tow cheques neither the notice was given within the statutory period nor it was served on the drawer and complaint was filed expiry of 15 days from the receipt of the notice only on issuance of the cheques for security purpose given by the accused. The complainant CC.No.19448/2017 10 misutilised the same filed this false complaint only harass the accused . For all these reasons pray for dismiss the complaint filed by the complainant in the interest of justice.
6. Heard arguments and perused the material placed on record.
7. On the basis of the above facts, the following points arise for my consideration:
1.Whether the complainant proves that the accused towards discharge of legal recoverable debt issued 5 cheques bearing Nos.(1)833110 dt:23.08.2016 for Rs.1,90,548/- (2)833111 dt:23.08.2016 for Rs.1,83,440/- (3)833106 dt:24.08.2016 for Rs.1,84,822/-
(4)833107 dt:23.08.2016 for
Rs.1,85,910/- (5)833108 dt:23.08.2016
for Rs.1,84,428/- drawn on Canara
Bank, Kumara Park West branch,
Bangalore in favour of complainant, on presentation for encashment it was returned as 'Funds Insufficient' and in CC.No.19448/2017 11 spite of receipt of legal notice, the accused failed to pay the cheque amount within the statutory period and thereby the accused has committed an offense punishable u/s 138 of N.I. Act?
2. What order?
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:
REASONS
9. Point No.1:- In order to prove the case of the complainant, the Director of the complainant Company Sri. K.S Narendra filed affidavit by way of examination-in-chief and has reiterated all the allegations made in the complaint on oath. In the evidence PW1 has produced the documents which are marked Ex.P1 to P.27. On perusal of the documents produced on behalf of the complainant Ex.P1 is the Chit license, Ex.P2 is the chit commencement CC.No.19448/2017 12 certificate, Ex.P3 is the Chit license, Ex.P4 is the Chit agreement, Ex.P5 is the Minutes, Ex.P6 & 7 are the two applications, Ex.P8 is the achit agreement, Ex.P9 is the memorandum of articles of association, Ex.P10 & 11 are the vouchers, Ex.P12 is the account extract, Ex.P13 to 17 are cheques, Ex.P18 to 22 are the bank memo's, ExP.23 is the legal notice, Ex.P23(a) is the receipt, Ex.P23(b) is the postal acknowledgement, Ex.P23(a) is the postal receipt, Ex.P23(b) postal acknowledgement, Ex.P24 is the complaint, Ex.P25 is the demand pronote, Ex.P26 is the statement, Ex.P29 is the reply notice.
10. This being the contention on either side , the complainant company Director K.S Narendra examined as PW1. In this chief examination he has reiterated all the facts narrated in the complaint and apart from this in order to substantiate the claim of the complainant company got marked the documents Ex.P1 to Ex.P27. On perusal of Ex.P2 to 4 which are CC.No.19448/2017 13 the certificate issued by the competent to authority to run the chit business of the complainant company, Ex.P5 is the minutes copy, Ex.P6 & 7 are the application given by the accused to the complainant company, Ex.P8 is the chit agreement, Ex.P9 Memorandum of articles of association, Ex.P10 & 11 are the voucher executed by the accused with regard to the chit group-H24-1-1-15. On perusal of the said documents which clearly goes to show that the complainant has authorise to file this compliant and the complainant company has taken permission from the competent authority to run the chit business and also accused has given application Form for enrollment and also executed chit agreement and voucher as per Ex.P10 and 11.
11. It is pertinent to note that the complainant has produce Ex.P13 to 17, 5 cheques in all for Rs.9,29,348/- and also produce Ex.P18 to 22 returned memo by the Karur Vysya Bank. On perusal of the CC.No.19448/2017 14 Ex.P13 to 17 which are the cheques numbers 833108, 833111, 833107, 833110, 833106 for Rs.1,84,428/-, 1,83,440/-, 1,85,910/-, 1,90,548/-, 1,84,822/- and on presentation of the said cheque which dishonored with endorsement 'exceeds arrangements'. On perusal of the Ex.P13 to 17 and 18 to 22 which clearly goes to show that the accused has issued said 5 cheques in favour of the complainant company and on presentation of the said cheques returned for the reason 'exceeds arrangements'.
12. The complainant has produce Ex.P23, Ex.P23(a) & (b) which are copy of legal notice, postal receipt, acknowledgment also clearly goes to show that the legal notice issued by the complainant company served on the accused.
13. The complainant has also produce Ex.P26 which is the statement of the complainant company. On perusal of the same, which clearly goes to show that on 10.10.2015 Rs.30,09,776/- is credited to the CC.No.19448/2017 15 accused company.
14. In the present case earlier the complainant has filed complaint in all 6 cheques, out of which cheque No.084243 dt:26.03.2016 amount of Rs.1,74,360/- as it is time bared, the complainant has filed application for amendment for delete the said cheque in the present case. The said IA filed by the complainant after hearing on both side came to be allowed and amendment carried out as per the order dated 18.03.2017. In view of this, as per the contention taken by the accused the claim of the complainant is bared by limitation holds no water.
15. In the present case the learned counsel for the accused in order to prove the defense of the accused cross examined to the PW1 in length. Inspite of that nothing has been elicited in order to show that the complainant has misutilised the cheque given by the accused for security purpose. Apart from this the accused himself examined as DW1 and got marked the CC.No.19448/2017 16 documents Ex.D1 to D8. On perusal of the same, which are pertains to litigation pending before the Deputy Registrar of chits and it is a specific contention of the accused that in view of case filed by the complainant before the Deputy Registrar of Chits this present case is not maintainable. On perusal of the evidence and documents placed on record on behalf of the complainant and also this present case filed by the complainant u/sec.138 of N.I Act for for dishonour of cheque issued by the accused. In view of this I do not find reasonable ground in the defence taken by the accused.
16. At the time of argument the learned counsel for the accused has I have discussed above submitted zerox copy of decision reported:
.AIR 2016 SC 4363 Sampelly Satyanarayana Rao V/s Indian Renewable Energy Development Agency Limited.
2. ILR 2019 Karnataka 1953 - Sami Labs Limited V/s M.V Joseph CC.No.19448/2017 17 On perusal of the said decisions dictum laid down by their lordship is also aptly applicable to the case of the complainant.
17. In the instant case the complainant has produce Ex.P13 to 17 in all Rs.9,29,348/- with signature Ex.P13(a) to Ex.P17(a) on the said cheques and contended that cheques have been issued by the accused in discharge of legal debt and liability which on presentation for collection were dishonored for the reason 'funds insufficient' as per Ex.P118 to 22 memo's. It is pertinent to note that nowhere in the cross examination, the counsel for the accused have denied the execution of the cheques Ex.P13 to Ex.P17 with signature Ex.P13(a) to Ex.P17(a) and also during cross examination of accused he has admitted for the same and apart from this in the present case accused during his cross examination admitted voucher Ex.P10 and 11 executed by him for an prized amount of CC.No.19448/2017 18 Rs.35,00,000/- as contended by the complainant and apart from this the complainant has also produce Ex.P25 On Demand promissory note executed by the accused and also guarantors dated 30.09.2015. On perusal of all these documents which clearly goes to show that as per the allegation made by the complainant the accused has bid the chit forego a sum of Rs.15,00,000/- and received the prized chit amount of Rs.35,00,000/-. There after as there is due of Chit amount executed the cheques Ex.P13 to 17 and on presentation of the said cheques by the complainant which returned with an endorsement "exceeds arrangements' as per Ex.P18 to 22/bank memo's. The entire burden is on the accused to rebut the presumption u/sec.139 of N.I Act. As per the dictum of law laid down in the following case of Hon'ble Supreme Court in:
2019 SAR 2446 (Criminal) 309 Supreme Court, ( Bir Singh v/s Mukesh Kumar).
CC.No.19448/2017 19 (E) Negotiable Instruments Act (26 of 1881), S, 138, 139 - Dishonour of cheque - Presumption as to legally enforceable debt - Rebuttal - Onus to rebut presumption that cheque issued in discharge of debt or liability is on accused. (Para 36) (G)Negotiable Instruments Act, (26 of 1881), Ss.138, 139 - Presumption as to legally enforceable debt - Rebuttal - Signed blank cheque- If voluntarily presented to payee, towards payment, payee may fill up amount and other particulars and it in itself would not invalidate cheque - Onus would still be on accused to prove that cheque was not issued for discharge of debt or liability by adducing evidence.
(Para-38).
(H) Negotiable Instruments Act (26 of 1881), Ss, 138- Dishonour of cheque - Complainant can fill up amount or particulars in blank cheque. (Para 38).
(J)Negotiable Instrument Act 26 of 1881), Ss.
CC.No.19448/2017 20 138, 139 - Dishonour of cheque - Absence of finding that cheque was not signed by accused or not voluntarily made over to payee- No evidence regarding circumstances in which blank signed cheque given to complainant - Cheque presumed to be filled in by complainant being payee in presence of accused, at his request or with his acquiescence- No change in amount, its date or name of payee- Subsequent filing in of an unfilled signed cheque is not alteration- Accused liable to be convicted. This ruling is applicable to the present facts and circumstances of the case since in para-36, 37, 38 & 40 the Hon'ble Supreme court has clearly laid down the dictum of law that the onus to rebut the presumption u/s 139 that the cheque has been issued in discharge of a debt or liability is on the accused and the fact that the cheque may be post dated does not absolve the drawer of the cheque of a penal consequences of sec.138 of the N.I Act.
CC.No.19448/2017 21
18. On perusal of the said ruling the Hon'ble Supreme Court had made it very clear that if a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill of 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 debt or liability by adducing evidence. It is further held that even blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption u/s 139 of the Negotiable Instrument Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt. It is also held that the provisions of Sec.20, 87 and 139 makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a CC.No.19448/2017 22 liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. Further in para-36 the Hon'ble Supreme Court makes it clear that the burden is on the accused to rebut the presumption u/s 139 of N.I Act that the cheques/Ex.P13 to 17 with signatures Ex.P13(a) to 17(a) in the instant case issued by the accused was not in discharge of legal debt and liability but in the instant case there is clear admission by the accused that the disputed cheques Ex.P13(a) to 17(a) and the signatures Ex.P13(a) to 17(a)s on the said cheques belongs to him and he had issued as per the condition No.6 mentioned in the declaration for the discharge of his legal debt and liability. In view of the dictum of law laid down in the above referred judgment and on appreciating the evidence of the accused and complainant it is crystal clear that the accused failed to rebut the presumption existing u/s 139 N.I Act in CC.No.19448/2017 23 favour of the complainant.
19. The word 'unless contrary is proved' is discussed by the Hon'ble Apex Court in a decision reported in 2011 Crl.L.J 4647 (SC). It is observed that "the accused is under the obligation to prove his case in trial by leading cogent evidence that there was no debt or liability to the satisfaction of the Court". 'Unless contrary is proved' means the presumption has to be rebutted by proof and not by a bare explanation which is mere plausible. The said fact is said to be proved when its existence is directly established or when upon the material before it the Court finds its existence to be so probable that the reasonable man could act on the supposition that is exist. Therefore, unless explanation is supported by proof, the presumption created by the provisions cannot be said to be rebutted. In the instant case accused has utterly failed to rebut the presumption by producing cogent evidence and relevant document that CC.No.19448/2017 24 the complaint filed against the accused is not maintainable.
20. In this case, the court on perusal of the materials placed before the court is satisfied that the mandatory requirements of Sec.138 and 142 of N.I. Act has been duly complied. It is evident that the cheques/Ex.P13 to 17 presented for encashment within the validity time.
21. On appreciation of entire evidence, this court is of the opinion that the accused miserably failed to challenge the oral and documentary evidence produced by the complainant. Accused has utterly fails to prove the fact that he has not issued cheques for discharge of legally enforceable debt. On the contrary, the complainant has proved through overwhelming evidence that the accused has issued Ex.P13 to 17/cheques for a total sum of Rs.9,29,348/- towards discharge of legally enforceable debt and on presentation of the cheque, the same are dishonored CC.No.19448/2017 25 for the reasons 'Exceeds arrangement' and even after service of legal notice, the accused has not paid the cheques amount. Hence, in the considered view of this court, the complainant has proved that the accused has committed an offense punishable u/s 138 of N.I. Act. Hence, I answer the above point No.1 in the affirmative.
22. Point No.2:- From the material on record, it appears that the accused is aged about 43 years and doing business. Considering the age, avocation of accused and quantum of the cheque, if the accused is sent to jail, it would cause problem to the accused as well as to his family members. Having regard to the facts and circumstances, prevailing rate of interest in the nationalized Bank and litigation expenses, I proceed to pass the following:
ORDER The accused is found guilty for the offence punishable u/s 138 of N.I. Act.
CC.No.19448/2017 26 Acting u/s 255(2) of Cr.P.C. the accused is convicted and sentenced to pay fine of Rs.9,35,000/-, in default shall undergo simple imprisonment for six months.
Out of fine amount of Rs.9,35,000/- a sum of Rs.9,30,000/- is ordered to be paid to the complainant towards compensation u/s 357(3) of Cr.P.C. and the balance amount of Rs.5,000/- shall be remitted to the State.
The bail bond executed by the accused shall stand canceled.
Supply free copy of the judgment to the accused. (Dictated to Stenographer directly on the Computer, taken print out corrected, signed by me and then pronounced in the open court this the 9 th day of April, 2021) (PRUTHVIRAJ VERNEKAR) XXVIII Addl. Chief Metropolitan Magistrate, Bengaluru.
CC.No.19448/2017 27 ANNEXURE Witnesses examined for the Complainant:-
PW1 : Sri. K.S Narendra Witnesses examined for the accused:-
DW1. : Sri. Shankar. J Documents exhibited by the Complainant:-
Ex.P1 : Chit license
Ex.P2 : Chit commencement certificate
Ex.P3 : Chit License
Ex.P4 : Chit circular
Ex.P5 : Minutes
Ex.P6&7 : 2 applications
Ex.P8 : Chit agreement
Ex.P9 : Memorandum & articles of association
Ex.P10&11: 2 vouchers
Ex.P12 : Account extract
Ex.P13 to 17: Cheques
Ex.P18to 22: Bank endorsements
Ex.P23: Legal notice
Ex.P23(a) : Receipt
Ex.p23(b) : Postal acknowledgment
Ex.P24 : Complaint
Ex.P25 : On Demand pronote
Ex.P26 : Karuru Vysya Bank Statement
Ex.P27 : Reply notice.
CC.No.19448/2017
28
Documents exhibited by the Accused:-
Ex.D1 : C/c of amended original application Ex.D1(a) : Application relating to Ex.D1 Ex.D2 : Evidence regarding amended application Ex.D3 : C/c copy of order sheet Ex.D3(a) : Further order sheet Ex.D4 : C/c of evidence of complainant dated 27.02.2017 Ex.D5 : Complaint copy before amended Ex.D6 : 13 receipts Ex.D7 : One receipt in page No.80 Ex.D8 : 17 receipts in page No.85 to 101 XXVIII Addl. Chief Metropolitan Magistrate, Bengaluru.
CC.No.19448/2017
29
Judgment pronounced in the
open Court vide separate order.
ORDER
The accused is found guilty for the offence punishable u/s 138 of N.I. Act.
CC.No.19448/2017 30 Acting u/s 255(2) of Cr.P.C. the accused is convicted and sentenced to pay fine of Rs.9,35,000/-, in default shall undergo simple imprisonment for six months.
Out of fine amount of Rs.9,35,000/- a sum of Rs.9,30,000/- is ordered to be paid to the complainant towards compensation u/s 357(3) of Cr.P.C. and the balance amount of Rs.5,000/- shall be remitted to the State.
The bail bond executed by the accused shall stand canceled.
Supply free copy of the judgment to the accused.
XXVIII A.C.M.M, Bangaluru.