Bangalore District Court
M/S Ninjacart Services Pvt Ltd vs Anjaneya Traders on 7 July, 2025
KABC030118962024
IN THE COURT OF THE XXV ADDL. CHIEF JUDICIAL
MAGISTRATE, AT BANGALORE CITY
Dated this the 7th day of July 2025
Present : SRI. GOKULA. K
B.A.LL.B.
XXV Addl. Chief Judicial Magistrate,
Bangalore City.
C.C.No.6299/2024
Complainant : M/s.Ninjacart Services Private Limited
R/of Sy No.16/1 & 17/2
Bellandur Gate, Sarjapura Main Road
Ambalipura, Bengaluru 560 102.
Rep by its Manager
Mr.Kiran Kashinathan.
(By HM Advocate )
V/s
Accused : Anjaneya Traders
Ashok D.R. S/o Ramegowda
3rd cross, Deshahalli,
Maddur Taluk,
Mandya Dist 571 429.
Rep by its Proprietor
Ashoka.D.R.
(By BSS - Advocate )
Plea of accused: Pleaded not guilty
Final Order: Accused is convicted
Date of judgment : 07.07.2025.
2
C.C.No.6299/2024
JUDGMENT
The complainant has filed the complaint under Section 200 of Criminal Procedure Code against the accused for the offences punishable under Section 25 of The Payment and Settlement Systems Act 2007 r/w Section 138 of Negotiable Instruments Act.
2. The brief case of the complainant is as under:
That the complainant is involved in the business of wholesale trading of agricultural products and fresh produce supply and tied up with Non Banking Financial Institutions to enable the service of credit facility to borrowers as per the guidelines of Reserve Bank of India. The accused is engaged in the business of wholesale trade of agricultural products and commission agency. The accused approached the complainant for loan through M/s Trillion Loans Fin tech Private Limited in loan ID No.36850. After considering the same, the M/s Trillion Loans Fin-tech Private Limited sanctioned loan to the sum of Rs.21,15,601/- on 23-05-2023 and the accused has availed a sum of Rs.12,10,749/-. The accused has agreed to repay the loan as per the terms and conditions of the loan agreement. The accused approached for loan on online platform and he has digitally signed the loan documents. The complainant is acting as an assignee of M/s Trillion Loans Fin-tech Private Limited. It is pleaded that during the process of loan transaction the 3 C.C.No.6299/2024 accused has issued a signed NACH (National Automated Clearing House) mandate towards part payment bearing No. SBIN7022505230060821 drawn on State Bank of India registered on 25-05-2023, for a sum of Rs.10,00,000/- towards due discharge of debt/liability. After availing loan, initially, the accused made regular payments and later the accused failed to make payment as per the agreement. The accused on repeated demands of the complainant, instructed to present the NACH mandate which is given for outstanding amount. As per the instructions of the accused, the complainant has processed E- NACH mandate through his banker HDFC Bank, 1st Stage, Koramangala for a outstanding sum of Rs.7,51,115/- and on processing said E NACH Mandate, it is returned dishonored with remarks "Balance Insufficient" in the account of the accused to honour the same on 18-01-2024 bearing sequence No.9599543592. On receipt of said intimation, the complainant got issued legal notice on 19-01-2024 through registered post and demanded to pay the amount dishonoured under E-NACH Mandate. The notice is returned with postal endorsement Unclaimed on 01-02-2024. Inspite of issuance of notice, the accused failed to pay the claim amount to the complainant with in the statutory time. Therefore, the accused has committed the offence punishable Section 25 of the Payment and Settlement 4 C.C.No.6299/2024 Systems Act 2007 r/w Section 138 of Negotiable Instruments Act. Therefore the complainant has filed the complaint.
3. On the basis of Private complaint filed by the complainant, this court has taken cognizance of offence and registered the case in PCR No.3278/2024 and recorded sworn statement of the complainant and got marked 11 documents as Ex.P1 to Ex.P11. This court by considering the material on record issued process to the accused and presence of the accused secured by executing NBW and he is released on bail. The copy of the complaint is served to the accused along with the summons as contemplated under Section 207 of Criminal Procedure Code.
4. The substance of the acquisition as provided Section 251 of Cr.PC is read over to the accused and his plea is recorded. The accused has pleaded not guilty and claimed to be tried.
5. In view of the law laid down by Hon'ble Supreme Court of India in Indian Bank Association V/s Union of India and others reported in AIR 2014SCW3463, the affidavit filed by the complainant at the stage of taking cognizance and documents marked is treated as evidence under section 145 of Negotiable Instruments Act. On the application of the accused PW 1 is recalled and he is examined in full. After closer of evidence of the complainant the incriminating circumstances in the evidence of the complainant is read over to the accused and his 5 C.C.No.6299/2024 statement under Section 313 of Cr.P.C is recorded. The accused has denied the same as false. The accused is examined as DW 1 and produced a document as Ex.D.1.
6. Heard arguments of learned counsel for the complainant and learned counsel for the accused and perused the material on record.
7. On the basis of the material on record the following points arise for the consideration of this court :
1. Whether the complainant proves that the accused has issued NACH Mandate SBIN7022505230060821 drawn on State Bank of India registered on 25-05-2023, for a sum of Rs.10,00,000/- for discharge of liability and it is dishonoured on processing for collection for a sum of Rs.7,51,115/- on 18-01-2024 in sequence no. 9599543592 for the reason Balance Insufficient and inspite of issuance of demand notice dated 19-01-
2024 the accused failed to repay the amount with in the statutory period and thus committed an offence punishable under Section 25 of The Payment and Settlement Systems Act r/w Section 138 of Negotiable Instruments Act ?
2. What Order or Sentence ?
6
C.C.No.6299/2024
8. The findings of this court to the above points are as follows:
Point No.1 In the Affirmative.
Point No.2 As per final order
for the following :
REASONS
9. POINT NO.1: To prove the case the authorized representative of the complainant examined as PW-1 and in his evidence affidavit he has reiterated the averments made in the complaint. To prove incorporation of the company the PW 1 has produced the certificate of incorporation as Ex.P 1. The PW 1 has produced the resolution of Board of Directors of the company as Ex.P 2. As per Ex.P 2 the PW1 is authorized to represent the complainant company and prosecute the accused. The accused in the cross examination has disputed the authority of PW 1 to represent the company. It is also contended that except Ex.P 2 authorization letter the complainant has not produced any document to show that he is working as senior manager of complainant company. In Ex.P 2 authorization letter it is stated that Board of Directors has authorized PW 1 to represent company. Therefore the authority of PW 1 to represent complainant company cannot be doubted, but his knowledge about the transactions is to be appreciated in the further discussions. Therefore, these documents prove the legal status of the complainant as a Company and authority of PW 1 to represent the complainant company.
7
C.C.No.6299/2024
10. The offence alleged is primarily under Section 25 of The Payment and Settlement Systems Act 2007, which reads as under.
Section 25. Dishonour of electronic funds transfer for insufficiency, etc., of funds in the account.
(1) Where an electronic funds transfer initiated by a person from an account maintained by him cannot be executed on the ground that the amount of money standing to the credit of that account is insufficient to honour the transfer instruction or that it exceeds the amount arranged to be paid from that account by an agreement made with a bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may extend to two years, or with fine which may extend to twice the amount of the electronic funds transfer, or with both:
Provided that nothing contained in this section shall apply unless--
(a) the electronic funds transfer was initiated for payment of any amount of money to another person for the discharge, in whole or in part, of any debt or other liability;
(b) the electronic funds transfer was initiated in accordance with the relevant procedural guidelines issued by the system provider;
(c) the beneficiary makes a demand for the payment of the said amount of money by giving a notice in writing to the person initiating the electronic funds transfer within thirty days of the receipt of information by him from the bank concerned regarding the dishonour of the electronic funds transfer; and
(d) the person initiating the electronic funds transfer fails to make the payment of the said money to the beneficiary within fifteen days of the receipt of the said notice. (2) It shall be presumed, unless the contrary is proved, that the electronic funds transfer was initiated for the discharge, in whole or in part, of any debt or other liability.8
C.C.No.6299/2024 (3) It shall not be a defence in a prosecution for an offence under sub-section (1) that the person, who initiated the electronic funds transfer through an instruction, authorization, order or agreement, did not have reason to believe at the time of such instruction, authorization, order or agreement that the credit of his account is insufficient to effect the electronic funds transfer. (4) The Court shall, in respect of every proceeding under this section, on production of a communication from the bank denoting the dishonour of electronic funds transfer, presume the fact of dishonour of such electronic funds transfer, unless and until such fact is disproved.
(5) The provisions of Chapter XVII of the Negotiable Instruments Act, 1881 (26 of 1881) shall apply to the dishonour of electronic funds transfer to the extent the circumstances admit. Explanation.--For the purposes of this section, "debt or other liability" means a legally enforceable debt or other liability, as the case may be.
This provision also specify that the provisions of chapter XVII of the Negotiable Instruments Act to the extent the circumstances admit is applicable. The essential ingredients of section 25 of The Payment and Settlement Systems Act 2007 to be complied are i) An electronic fund transfer initiated by the person from his account ii) Processing of the NACH Mandate by the beneficiary, iii) it returning unexecuted for the reason insufficiency of funds to honour transfer instructions. iv) electronic fund transfer was initiated in discharge of any debt or liability v) it is initiated in accordance with the relevant procedural guidelines issued by the service provider vi) Beneficiary making demand with in 30 days of receipt of information of dishonour by giving notice in writing, vii) failure 9 C.C.No.6299/2024 of the person initiating electronic fund transfer to make payment within the period of 15 days after receipt of the demand notice. The Payment and Settlement Systems Act 2007 does not prescribe any time limit to file the complaint. Therefore it is necessary to apply provisions of Section 142 of The Negotiable Instruments Act. Therefore the complainant shall present the complaint within a month after expiry of 15 days of service of notice to the accused.
11. Therefore it is proper to consider whether the statutory requirements for constituting the offence under Section 25 of the Payment and Settlement Systems Act 2007 r/w Section 138 of Negotiable Instruments Act is complied by the complainant. The PW 1 has deposed that the complainant is tied up with Trillion Loans Fine-tech Private Limited, a Non Banking Financial Institution and the complainant is assignee of Trillion Loans Fine-tech Private Limited. He has deposed that the accused approached the complainant for credit facility through online and the complainant has facilitated the credit facility to the accused through Trillion Loans fine-tech Pvt Ltd for a sum of Rs.21,15,601/-, out of which the accused has availed a sum of Rs.12,10,749/- from Trillion Loans fine-tech Pvt Ltd through the complainant, which is to be repaid as per the terms and conditions of the loan agreement. The PW 1 has deposed that towards repayment of liability, the accused issued E NACH 10 C.C.No.6299/2024 Mandate for monthly installments bearing No. SBIN7022505230060821 drawn on State Bank of India registered on 25-05-2023, for a sum of Rs.10,00,000/- towards due discharge of debt/liability. The PW 1 has produced the NACH mandate copy as Ex.P 6. He has deposed that the accused has defaulted to repay the loan availed regularly as agreed upon and he become defaulter in repayment. He has deposed that they have processed said NACH Mandate issued by the accused for realization of a sum of Rs.7,51,115/- through sequence no.9599543592 through their banker ie HDFC Bank, Koramangala Branch, Bengaluru and said NACH Mandate returned dishonored on 18.01.2024 for the reason "Balance Insufficient" in the account of the accused to execute the mandate. As provided under Section 25(4) of The Payment and Settlement Systems Act and also under Section 146 of Negotiable Instruments Act law presumes that on production of banker's slip or memo having thereon the official mark denoting that the cheque/ electronic fund transfer has been dishonored, presume the fact of dishonor of such said cheque, unless and until same is disproved. The accused has not disputed the dishonour of NACH mandate. The PW1 has deposed that they have got issued legal notice dated 19.01.2024 calling upon the accused to pay the due amount as per Ex.P8. The PW 1 has deposed that said notice issued through RPAD returned with an 11 C.C.No.6299/2024 endorsement "Not Claimed" on 01.02.2024 and produced the postal receipt and postal envelope as Ex.P 9 and Ex.P 10. Therefore it is clear that the accused has not claimed the legal notice. Therefore it is deemed service of the notice. Therefore even though notice returned as "not claimed" it is sufficient compliance of provisions of law. The PW 1 deposed that inspite of issuance of notice, the accused failed to pay the claim amount to the complainant with in the statutory time. The complaint is filed before this court on 28.02.2024. Thus the complainant has complied all the statutory requirements for constitution of offence under Section 25 of The Payment and Settlement Systems Act 2007 r/w Section 138 of Negotiable Instruments Act. Therefore, the complainant is entitled for presumption under Section 25 (2) of The Payment and Settlement Systems Act 2007. Under Section 139 of Negotiable Instrument Act also there is similar presumption. The provisions of Section 139 of Negotiable Instrument Act reads as under:-
139- Presumption in favour of holder - It should be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability.
12. Hon'ble Supreme court in a decision reported in (2010) 11 SCC 411 between Rangappa V/s Sri Mohan has held that - 12
C.C.No.6299/2024 The presumption mandated by Section 139 of the act does indeed include the existence of a legally enforceable debt or liability. It is also observed that Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instrument. It is also held that in such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the defendant caused cannot be expected to discharge an unduly high slandered or proof.
Therefore the principles laid down in this decision can also be made applicable to the proceedings for the offence under Section 25 of The Payment and Settlement Systems Act 2007. In view of the principles laid down in these decisions the onus is on the accused to rebut the presumption. The accused has not issued any reply at the initial stage at the time of service of the legal notice. The accused has taken his defence in the cross examination of PW1.
13. The accused has denied the authority of complainant to lend money to the accused and its authority to recover the loan from the accused. In the cross examination much is asked with the PW 1 that the complainant is not registered as Non Banking Financial Institution (NBFI) with RBI and they are not having authority to do financial services. But it is not the case of complainant that they have registered with RBI as NBFI. It is 13 C.C.No.6299/2024 the case of the complainant that they have facilitated the loan to the accused from Trillion Loans Fine-tech Pvt Ltd, which is an NBFI. The PW 1 has produced the loan application as Ex.P 3, Sanction Letter as Ex.P 4 and Loan agreement as Ex.P 5. In these documents it is clear that the loan is sanctioned by Trillion Loans fin-Tech Pvt Ltd to the accused firm and not by the complainant firm. In the sanction letter Ex.P 4 in the terms and conditions No. 8 it is specifically stated that "repayment shall be made by you using Ninjacart Services and its affiliates or partner entity App. On behalf of us, Ninjacart Services (Ninjacart services Pvt Ltd) and its affiliates entity facilitates the National Automated Clearing House (NACH) mandate or similar payment mandates provided by you for payment / repayment of dues." The accused digitally signed Ex.P 3 to 5 documents. Therefore the contention of the accused that the compliant is not NBFI and they have no authority to recover the loan is not tenable. The authority is given to the complainant in the sanction letter itself and the accused has acknowledged the same. Therefore this contention of the accused is not tenable and not help the accused to rebut the presumption of existence of legally recoverable debt.
14. The accused has brought on record some discrepancies in the averments in the complaint about the amount lent to the accused. In respect of same loan account, the complainant has 14 C.C.No.6299/2024 processed NACH for twice and it is dishonoured twice and the complainant has filed this case and another case in CC NO. 22876/2024 before this court. In the cross examination of PW 1 it is elicited that the accused has availed loan in 5 credit transactions for Rs.11,26,200/-. It is also elicited that in the complaint in this case it is pleaded that a sum of Rs.12,10,749/- is availed by the accused and in CC No. 22876/2024 it is pleaded that a sum of Rs.14,16,639/- is availed by the accused. But in the cross examination PW 1 has deposed that accused has availed only a sum of Rs.11,26,200/-. Therefore there is distinction in the availment of the loan by the accused under the credit facility. Therefore the accused has much contended that there is falsity in the case of the complainant and the complainant has not produced statement of accounts or debit note for av availment of the loan by the accused. The accused has suggested that the Trillion Loans Fine-tech Pvt Limited has credited only RS. 3,26,200/- to the bank account of the accused and he has produced the account statement of accused Anjaneya Traders as EX.D1. The complainant has also admitted that to the account of Anjaneya Traders the amount deposited is only Rs.3,26,200/- only. But the complainant has stated that they have credited a sum of Rs.2,00,000/- each to the personal account of proprietor of the accused firm Ashoka D.R. on 23-01-2024, 24-01-2024, 25-01- 15 C.C.No.6299/2024 2024 and 31-01-2024 totally Rs.8,00,000/-. To substantiate said aspect the complainant has got summoned the statement of accounts of the proprietor of the accused Ashoka D.R. from State Bank of India. The said statement of accounts is produced by the Bank manager and it is marked through PW 1 as Ex.P 11 and relevant entry for credit of amount on the above stated dates as Ex.P 11(a) to (d). The accused in the cross examination has not denied credit of said amount of Rs.8,00,000/- to the EX.P 11 account from the complainant/ Trillion Loans Fine-tech Pct Ltd. The accused has suggested that it is not related to loan application No.36850, in respect of which now the complainant is making the claim. The accused except suggesting it, he has not disclosed for which transaction said amount is credited by the complainant/ Trillion Loans Fine-tech Pct Ltd. Mere denial of the accused is not sufficient to rebut the presumption and be should produce probable material. Thus the documents produced by the complainant proves that a sum of Rs.3,26,200/- is credited to the proprietor ship firms account and Rs.8,00,000/- is credited to the account of Ashok D.R. the proprietor of the firm. Therefore even though there is some discrepancy in the averments in the complaint in both cases about the amount availed by the accused from the complainant, by producing the statement of accounts the complainant has established the loan amount availed by the accused through the 16 C.C.No.6299/2024 complainant. Therefore all these contentions of the accused is not helpful or sufficient to the accused to create doubt about availment of the credit facility by the accused and the existence of legally recoverable debt.
15. Further the accused has also taken contention that he has made repayment of Rs.1,90,000/- to the loan account. The PW 1 has also admitted in his cross examination that in respect of both cases they have received a sum off Rs.1,90,000/- from the accused. Therefore repayment for a sum of Rs.1,90,000/- is not in dispute. This contention of the accused itself shows that he has not repaid the loan availed as per the terms and conditions of the loan as shown in Ex.P 3 to 5 loan documents and he has committed default. The accused by taking this contention has admitted existence of legally recoverable debt. The accused has not brought on record as to when he has paid said amount of Rs.1,90,000/- either before presentation of NACH or after presentation of NACH. The accused has not denied the execution of loan documents in online platform. Therefore this defence of the accused also not tenable and sufficient to rebut the presumption of existence of legally recoverable debt.
16. Therefore for the above discussion this court concludes that the defence put forward by the accused is not convincing to believe that existence of legal liability is doubtful and it is not 17 C.C.No.6299/2024 sufficient to rebut the presumption under Section 25 (2) of The Payment and Settlement Systems Act 2007 r/w Section 139 of Negotiable Instruments Act. The accused has failed to rebut the presumption under Section 25 (2) of The Payment and Settlement Systems Act 2007 r/w Section 139 of Negotiable Instruments Act. Therefore this court concludes that the complainant has successfully proved that the accused has committed the offence punishable under Section 25 of The Payment and Settlement Systems Act 2007 r/w. Section 138 of Negotiable Instruments Act. Therefore this court answers the above point No.1 in the Affirmative.
17. POINT NO. 2 : While answering the point no. 1 this court concluded that the complainant proved that the accused committed the offence punishable under Section 25 of The Payment and Settlement Systems Act r/w Section 138 of Negotiable Instruments Act. The Amount processed for collection through NACH is Rs.7,51,115/-. The NACH mandate is processed for collection on 18-01-2024. The money involved in the case is used in commercial transactions. Therefore considering all these aspects the amount of fine calculated for a sum of Rs.8,57,500/- Therefore considering all these aspects this court proceed to pass the following -
18
C.C.No.6299/2024 ORDER By exercising powers conferred Section 255(2) of Criminal Procedure Code the accused is convicted for the offence punishable under Section 25 of The Payment and Settlement Systems Act 2007 R/w Section 138 of Negotiable Instrument Act and he is sentenced to pay a fine of Rs.8,57,500/- (Rupees Eight Lakhs Fifty Seven Thousand and Five Hundred Only).
In default to pay the fine, the accused shall undergo simple imprisonment of 6 months.
Further acting Section 357(1)(a) of Criminal Procedure Code out of the fine amount a sum of Rs.5,000/- (Rupees Five Thousand only) shall be defrayed as prosecution expenses to the state.
Further acting Section 357(1)(b) of Criminal Procedure Code a sum of Rs.8,52,500/- (Rupees Eight Lakhs Fifty Two Thousand and Five Hundred Only) out of the fine amount on recovery shall be paid as compensation to the complainant.
Supply free copy of the judgment to the accused. (Dictated to the Stenographer directly on the computer, typed by her, corrected and signed then pronounced by me in the open court on this the 7th day of July 2025).
(GOKULA.K) XXV A.C.J.M., BANGALORE CITY.
19
C.C.No.6299/2024 ANNEXURE LIST OF WITNESSES EXAMINED FOR THE COMPLAINANT:
PW1 : Kiran Kashinathan.
LIST OF DOCUMENTS MARKED FOR THE COMPLAINANT:
Ex.P1 : Certified copy of Incorporation Certificate Ex.P2 : Copy of the Board Resolution Ex.P3 : Loan application Ex.P4 : Sanction Letter Ex.P5 : Loan Agreement Ex.P6 : NACH Ex.P7 : Return Memo Ex.P8 : Office copy of Legal Notice Ex.P9 : Postal Receipt Ex.P10 : Postal acknowledgment Ex.P11 : Statement of account.
LIST OF WITNESSES EXAMINED FOR THE ACCUSED:-
DW1 : Ashok D.R. LIST OF DOCUMENTS MARKED FOR THE ACCUSED:-
Ex.D1 : Statement of account. Digitally signed by GOKULA K GOKULA Date:
K 2025.07.07
16:07:57
+0530
(GOKULA.K.)
XXV A.C.J.M., BANGALORE CITY.