Bangalore District Court
Sri.Bhupendra S.Parekh vs Sri.Manohar Singh Jodha @ M.S.Jodha on 3 January, 2022
IN 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 3rd day of January 2022.
C.C.No.25495/2018
Complainant : Sri.Bhupendra S.Parekh,
S/o Late Shivalal S .Parekh,
Aged about 62 years,
Proprietor, Janatha Fabrics,
No.639, Bhandari Mansion,
Chickpet,
Bengaluru.
{ By Sri.M.B.Ramachandra - Advocate }
Vs.
Accused : Sri.Manohar Singh Jodha @ M.S.Jodha,
Major,
proprietor,
M/s.Varun Selections,
No.64, Balaji Silk Complex,
Opp.Ganapathi Bhandarkar,
Avenue Road,
Bengaluru- 02.
{ By Sri. Honnappa.S - Advocate }
2 C.C.25495/2018
Offence complained : U/S. 138 of N.I. Act.,
Plea of accused : Pleaded not guilty
Final Order : Accused is Convicted
Date of Order : 03-01-2022
JUDGMENT
The present complaint is filed under section 200 of code of criminal procedure against the accused for the dishonour of cheque at Ex.P.1 punishable under section 138 of the Negotiable Instruments Act ( in short referred as "N.I. Act").
02. The briefly stated facts of the complaint is as under;
It is alleged in the complaint that, the accused is the friend of complainant through one Puran Singh, the owner of 'Puran Textile', Raja Market, Bengaluru. In the month of 3 C.C.25495/2018 April 2016 and in the month of May 2016, the accused has requested to advance Rs.2,00,000/- twicely from the complainant for his financial commitments. Accordingly, in the month of April 2016, the complainant has paid Rs.1,80,000/- and at that time, the accused has executed on demand promissory note. Similarly, in the month of May 2016, the complainant again advanced Rs.1,70,000/- to the accused and at that time also, the accused has executed on demand promissory note with a promise to repay the loan amount with interest at the rate of 1.5% per month within 3 months. On the request of the complainant and in order to discharge of his debt, the accused in all has repaid Rs.50,000/- on different dates by making part payment and for the repayment of the remaining amount, the accused has issued a cheque bearing No.987808 dated 26.09.2017 for Rs.45,000/- , but on the request of the accused , the said cheque was not presented. Finally, the accused has issued a cheque bearing No.987806 Dated 4 C.C.25495/2018 30.06.2018 for Rs.4,37,019/-, drawn on Indian Bank, Avenue Road Branch, Bengaluru in favour of the complainant. The complainant has presented the above said cheque for encashment through his banker i.e., Syndicate bank, Chickpet Branch, Bengaluru, same was returned unpaid due to "Payment Stopped by the Drawer" as per banker's memo dated on 27.07.2018. Thereafter, the complainant got issued demand notice on 07.08.2018 to the accused and the said notice was duly served to the accused on 09.08.2018. Inspite of service of demand notice, accused neither has paid the cheque amount not has given any reply. Thus, the cause of action of the complaint arose on 15.09.2018. Accordingly, this complaint is filed within time and has sought to convict the accused by granting compensation as per section 357 of Code of Criminal Procedure double of the cheque amount. 5 C.C.25495/2018
03. On presentation of the complaint and after verification of the averments of the complaint as well as the annexed documents, this court took the cognizance for the offence punishable under section 138 of NI Act. As per the verdicts 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 recorded by way of examination-in-chief as PW.1 and got marked in all nine documents at Ex.P.1 to 9. Inspite of sufficient opportunity, accused has partly cross examined PW.1. After scrutinizing the oral and documentary evidence of the complainant prima-facie case is made out for the trial. Accordingly, by registering criminal case in Register No. III, summons has been issued against the accused.
04. In pursuance of the summons, the accused has appeared before the court through his counsel and filed bail application under section 436 of Code of Criminal 6 C.C.25495/2018 Procedure, the accused has been enlarged on bail. The accusation has been read over to the accused, he pleaded not guilty and wants to put forth defense. On filing application under section 145(2) of NI Act, accused was permitted to cross examine PW.1. In spite of granting sufficient time, the accused neither cross examined PW.1 nor has adduced the defense evidence. Even the accused deliberately avoided to appear before the court to cause obstructions to the proceedings. Therefore, in view of guidelines in the case of Indian Bank Association and others V/s Union of India and others, and the proceedings being held as summary in nature. The statement under section 313 of Code of Criminal Procedure has been dispensed with. In the ratio laid down by the Hon'ble High Court of Karnataka, in Crl.RP. No.437/2010 dated 28.06.2012, wherein it is held that;
"It is for the accused to appear before the court and to have defended himself effectively and to make himself available for 7 C.C.25495/2018 the court to record the statement under section 313 of Code of Criminal Procedure."
The accused himself not appeared before the court to give explanation to the incriminating evidence appeared in the trial of the complainant's case and also not chosen to lead any evidence.
05. Complainant relied on the following citations;
1. 2019(2) Kar.L.R.717 (SC) Uttam Ram Vs. Devinder Singh Hudan and Another
2. (2019)18 SCC 106 Rohitbhai Jivanlal Patel Vs. State of Gujarat And Another
3. Crl.Appeal No.123/2021 dated 10.02.2021. M/s.Kalamani Tex & Anr Vs. P.Balasubramanian I have carefully gone through the above relied judgments.
06. Heard the Learned Counsel for complainant. No arguments addressed on behalf of accused. The Learned counsel for the complainant filed written argument along 8 C.C.25495/2018 with precedents. Perused the citations, written argument and materials on record.
07. 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 bearing No.987806 Dated 30.06.2018 for Rs.4,37,019/-, towards the discharge of his lawful liability of the complainant and when the said cheque was presented for encashment, it was returned unpaid due to " Payment Stopped by the Drawer" in the account of the drawer as per banker's memo and inspite of issuance of demand notice , the 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 ?
9 C.C.25495/2018
08. 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
09. POINT No.1: It is the specific case of the complainant that, towards discharge the legally enforceable debt, the accused has issued a cheque at Ex.P.1 and the said cheque was presented for encashment, it returned unpaid as per banker's memo at Ex.P.2 due to " Payment Stopped by the Drawer" . Accordingly, as per Ex.P.3 complainant issued demand notice to the accused, but the accused neither has paid the cheque amount nor has given any reply. Thus, it is sought to prosecute and convict the accused as per section 138 of NI Act.
10. To bring home the guilt of the accused, as per the verdicts of the Hon'ble Apex court in the case of Indian 10 C.C.25495/2018 Bank Association and others V/s Union of India and others, the sworn statement of the complainant has been recorded by way of examination-in-chief as PW.1. PW.1 has replication of the averments of the complaint. The complainant in all has produced nine documents marked at Ex.P.1 to 9. Ex.P.1 is the alleged cheque dated 30.06.2018 issued by the accused, Ex.P.1(a) is the signature of the accused present on the Ex.P.1 cheque, Ex.P.2 is the banker's memo dated 27.07.2018, which reflects that, the cheque at Ex.P.1 has been presented for encashment and it returned unpaid due to "Payment Stopped by the Drawer" in the account of the drawer. Ex.P.3 is the demand notice dated 07.08.2018, which is replication of the averments of the complaint and it was duly served to the accused on 09.08.2018, Ex.P.4 is the postal receipt, Ex.P.5 is the postal acknowledgement, Ex.P.6 & 7 are the on demand promissory notes and consideration receipts, Ex.P.6(a) (b) & 7(a) (b) are the signatures of the accused 11 C.C.25495/2018 and Ex.P.8 & 9 are the Income Tax returns of the assessment year 2017-2018 & 2018-2019, the relevant portion marked in the said documents as Ex.P.8(a) & 9(a) . The Learned counsel for the accused partly cross examined PW.1.
11. To disprove the case of the complainant and also to rebut the statutory presumptions under sections 118(a) & 139 of NI Act, the accused did not enter into the witness box to lead his side evidence, but he has partly cross examined PW.1. It is trite law that, in order to rebut the statutory presumptions under sections 118(a) & 139 of NI Act and also to establish the defense, the accused can very well make use of the evidence of the complainant and rely upon the evidence of the complainant.
12. Before to appreciate the oral and documentary evidence of respective parties, it is necessary to find out 12 C.C.25495/2018 whether the present complaint would meet the mandatory provisions of section 138 of NI Act. On perusal of the cheque at Ex.P.1, banker's memo at Ex.P.2, the demand notice at Ex.P.3 , postal receipt at Ex.P.4 and postal acknowledgement at Ex.P.5, they clearly reveals that, the provisions of section 138(a) to (c) of NI Act has been complied.
13. The provisions of section 139 of NI Act contemplates that, 'There shall be a presumption unless the contrary is proved with the holder of a cheque received for the discharge, in whole or in part of any debt or other liability'. This provisions of law has been discussed in detail in the recent judgment of the Hon'ble Apex Court reported in, 2010(11) SCC 441, in the case of Rangappa Vs. Mohan, wherein it is held that;
" Once the cheque relates to the account of the accused and he accepts the same and also admits his signature on the cheque, 13 C.C.25495/2018 then the initial presumption under section 139 of NI Act as well as under section 118 of NI Act has to be raised in favour of the complainant. It is a mandatory presumption. But the accused is entitle to rebut the same on preponderance of probabilities."
In the recent judgment reported in, 2021(5) SCC 283, in the case of Kalamani Tex and Another Vs. P.Balasubramaniyan, the larger bench of the Hon'ble Apex Court, it is held that;
" U/s 118 & 139: Once issuance of cheque and signature admitted , it is required to presume that the cheque was issued as consideration for a legally enforceable debt."
The ratio laid down in the cited decisions is aptly applicable to the case on hand.
14. In the written arguments, the Learned counsel for the complainant contended that, during partial cross examination of PW.1, the cheque issued at Ex.P.1 is neither disputed nor the signature at Ex.P.1(a). Therefore, it is 14 C.C.25495/2018 sought to draw the presumption in favour of the complainant under section 139 of NI Act. The Learned counsel for the complainant has relied the following judgments;
1. 2019(2) Kar.L.R.717 (SC) Uttam Ram Vs. Devinder Singh Hudan and Another
2. (2019)18 SCC 106 Rohitbhai Jivanlal Patel Vs. State of Gujarat And Another
3. Crl.Appeal No.123/2021 dated 10.02.2021. M/s.Kalamani Tex & Anr Vs. P.Balasubramanian With due respect to the precedents of the above relied judgments, in the case of Uttam Ram Vs. Devinder Singh Hudan and Another, wherein the Hon'ble Apex Court held that;
"Once the cheque is proved to be issued it carries statutory presumption of consideration- Then the onus shifts on the accused to disprove the presumption".15 C.C.25495/2018
In another judgment relied in the case of Rohitbhai Jivanlal Patel Vs. State of Gujarat And Another, wherein the Hon'ble top court of the country pleased to held that;
" Presumption mandated by section 139 does indeed include existence of legally enforceable debt or liability - It is open to accused to raise defense wherein existence of a legally enforceable debt or liability can be contested - However, there can be no doubt that thee is an initial presumption which favours complainant ".
In another judgment relied in the case of M/s.Kalamani Tex & Anr Vs. P.Balasubramanian, the Hon'ble top court of the country pleased to held that;
" Once the 2nd appellant had admitted his signature on the cheque and the trial court ought to have presumed that, the cheque was issued as consideration for a legally enforceable debt."
It is further held that;
" A bare denial of passing consideration would not aid the case of the accused."16 C.C.25495/2018
In the light of the above precedents by the top court of the country, it is very clear that, once the accused has admits the issuance of cheque from his account and signature there on, the presumption under section 118(a) r/w section 139 of NI Act shall be drawn to the extent that, the accused has issued the said cheque for the consideration towards the discharge of his legal debt. In the instant case on hand, during partial cross examination of PW.1 in para No.2 of page No.10, a suggestion is made to PW.1 that, the disputed cheque was issued in the year 2016. Though, the witness denied this suggestion, but by this suggestion it can be inferred that, the accused is admitting the cheque at Ex.P.1 belongs to his account and that he has issued the said cheque for consideration towards discharge of his legal debt. Therefore, the presumption mandated under section 139 of NI Act goes in favour of the complainant. Now, the burden shifts on the accused to rebut the statutory presumptions under 17 C.C.25495/2018 sections 118(a) & 139 of NI Act. In order to rebut the statutory presumptions, it is suffice that, the accused may brought on record the evidence on preponderance of probabilities. During partial cross examination of PW.1 in para No.3 of page No.9 some material fact is elicited from the mouth of PW.1 that, on 25.07.2008, the accused has sent legal notice to the complainant and in the said notice, it was mentioned that, the complainant had taken 5 cheques of the accused as security documents. Though, the witness admits this suggestion, but to substantiate this suggestion before the court, the said legal notice dated 25.07.2008 is not produced before the court. Thus, only this admission by PW.1, do not inspires my confidence that a probable evidence is brought on record to hold that, the cheque at Ex.P.1 was issued as a security along with other 4 cheques. During further cross examination of PW.1, the case of the complainant has been denied and nothing is culled out from the mouth of PW.1 to believe that, a 18 C.C.25495/2018 probable evidence is brought on record to rebut the statutory presumptions under sections 118(a) & 139 of NI Act. Therefore, the accused has failed to rebut the statutory presumptions under sections 118(a) & 139 of NI Act and to raise probable defence. On the other hand, the complainant has produced the on demand promissory notes and consideration receipts marked at Ex.P.6 & 7, they clearly reveals that, on 24.04.2016 the accused borrowed hand loan of Rs.1,80,000/- from the complainant and similarly on 26.05.2016, he borrowed again Rs.1,70,000/- and has executed these two on demand promissory notes at Ex.P.6 & 7 by putting his signatures on Ex.P.6(a) & 7(a). These on demand promissory notes at Ex.P.6 & 7 are not at all disputed during the cross examination of PW.1. The oral testimony of PW.1 is very much corroborates by these two on demand promissory notes at Ex.P.6 & 7. The complainant also produced Income Tax returns form for the year 2017-2018 & 2018-2019 marked at Ex.P.8 & 9. In both 19 C.C.25495/2018 IT returns, the advancement of hand loan of Rs.3,50,000/- to accused 'Varun selection' is shown in Ex.P.8 and similarly hand loan of Rs.4,18,200/- to 'Varun selection' is shown in Ex.P.9. As per these documents, the complainant has also declared in his Income Tax returns about the indebt of the accused for Rs.4,18,200/- towards the complainant. These two documents at Ex.P.8 & 9 are also not disputed during cross examination of PW.1. Therefore, I am of the considered opinion that, the complainant has proved the disputed hand loan of Rs.4,37,019/- together with interest from the accused.
15. Therefore, by the evidence of PW.1 coupled with the documents at Ex.P.1 to 9, I am of the opinion that, the complaint has proved that, the accused has borrowed hand loan of Rs. 4,37,019/- from his and towards the discharge of the said loan amount, the accused has issued the cheque at Ex.P.1 and the said cheque was returned 20 C.C.25495/2018 unpaid due to "Payment Stopped by the Drawer" in the account of the accused. Therefore, I answered point No.1 in the affirmative.
16. POINT NO.2: During the pendency of the complaint, the complainant has filed IA under section 143(a) of NI Act seeking for interim compensation and after hearing both the parties, this court has ordered to the accused to pay compensation 10% of the cheque amount. Accordingly, the accused has deposited Rs.40,000/- interim compensation amount in this court vide Q.NO.15284/2010 dated 28.11.2019 and the said amount was also came to be released to the complainant as per order dated 07.01.2020 and this amount requires to be deducted from the total compensation amount to be awarded.
In view of the reasons stated and discussed above, the complainant has proved the guilt of the accused 21 C.C.25495/2018 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, 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.4,80,000/-
(Rupees Four Lakhs Eighty
Thousand only)
Rs.4,80,000/- - Rs.40,000/- =
Rs.4,40,000/-,
{Rs.40,000/- was already received
by the complainant as interim
compensation} Rs. 4,40,000/-. In
default of payment, he shall undergo simple imprisonment for 3 (Three) months.
22 C.C.25495/2018
Acting under section 357(1) of code of criminal procedure, it is ordered that an amount of Rs.4,30,000/- ( Rupees Four Lakhs Thirty Thousand only), there 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 3 rd day of January 2022}.
(BHOLA PANDIT) XX ACMM, Bengaluru.
23 C.C.25495/2018ANNEXURE List of witnesses examined on behalf of complainant:
P.W.1 Bhupendra S.Parekh 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 Postal receipt
Ex.P. 5 Postal acknowledgement
Ex.P.6 & 7 On demand promissory
notes and Consideration
receipts.
24 C.C.25495/2018
Ex.P.6(a) (b) & 7(a) (b) Signatures of accused
Ex.P.8 & 9 Income Tax returns of the
year 2017-2018 & 2018-
2019.
Ex.P.8(a) & 9(a) The relevant portions
marked in the Ex.P.8 & 9
documents.
List of witnesses examined on behalf of accused:
-Nil-
List of documents produced on behalf of accused:
-Nil-
XX A.C.M.M., Bengaluru.