Bangalore District Court
Sri.Devendran vs No.2 S/O Armugam on 1 February, 2022
1 Crl.A.No.125/2019
KABC010015982019
IN THE COURT OF THE LIX ADDL.CITY CIVIL &
SESSIONS JUDGE (CCH-60) AT BENGALURU)
Dated this the 01st day of February, 2022
-: P R E S E N T :-
Sri.Sadananda Nagappa Naik,B.A.L, L.L.B.,
LIX ADDL.CITY CIVIL & SESSIONS JUDGE, CCH-60
BENGALURU CITY.
Crl.Appeal No.125/2019
APPELLANT: Sri.Devendran
Accused No.2 S/o Armugam
Aged about 57 years,
Sy.No.100,
Bheemanakuppe village,
Kengeri Hobli
Bengaluru South Taluk,
Bengaluru 560 074
R/at Flat No.206,
Vastugreens
Kodipalya Cross,
Kengeri,
Bengaluru 560 060
(By Sri.Pradeep V.B, Advocate)
2 Crl.A.No.125/2019
Respondents/ 1. Shree PLA Pvt Ltd.,
Complainant No.154, Kodigehalli village
Near Machohalli Gate,
Magadi Main Road,
Bengaluru 560 091
Represented by its Power of
Attorney Holder
Sri.K.S.Arun.
Accused No.1 2. Bharath Chemicals Products
Sy.No.100,
Bheemanakuppe village,
Kengeri Hobli
Bengaluru South Taluk,
Bengaluru 560 074
Rep by its Partner Mahendra
Accused No.3 3. Sri.Mahendra
Partner
Bharath Chemicals Products
Sy.No.100,
Bheemanakuppe village,
Kengeri Hobli
Bengaluru South Taluk,
Bengaluru 560 074
(By Sri.C.M, Advocate)
JUDGMENT
Appellant has filed this appeal U/s.374(3) of Cr.P.C., being aggrieved by the judgment of conviction and order of sentence passed in C.C.No.19668/2015 dated 19.12.2018 on the file of XXVII Additional Chief Metropolitan Magistrate, Bengaluru.
3 Crl.A.No.125/20192. Parties to this appeal shall be referred as per their ranking before the trial court for the purpose of convenience and for better appreciation of their contentions.
3. In the memorandum of appeal, appellant has submitted that, trial court did not apply its judicial mind to the case and the contradiction brought out in the evidence Cross-examination and the case of the respondent was ignored by the trial Court. The explanations offered by the appellant in so far as non replying to the legal notice was again ignored. Appellant was accused No.2 and respondent No.2 is the accused No.1, respondent No.3 is the accused No.3 and respondent No.1 was the complainant before the trial Court. The trial Court has not at all considered that Ex.P1 Board of Resolution is not valid since as per the Ex.P14 Memorandum of Articles and Articles of Association of the complainant company, there are three directors in the complaint company namely Jaikumar, Yashaswini Jai Kumar and Poonam. However, the Ex P1 was signed by only two Directors i.e., Jay Kumar.S and Purnamal Tulsyan. Hence, the Power of Attorney of the complainant company is not at all authorised person and the complaint itself is not maintainable. The trial Court has failed to appreciate the evidence adduced by the accused No.2. Hence, the judgment and order of conviction 4 Crl.A.No.125/2019 against accused No.2 is not maintainable. Ex.P5 cheque dated 25.02.2015 is outdated cheque since the said cheque presented to the bank for encashment in the first week of June 2015 and this was not considered by the trial Court at the initial stage and later when the appellant has taken such stand, the complainant advanced the case posted for judgment and produced the documents and the trial Court has erroneously considered the same. Ex.P5 and P6 cheques are not belong to the account of the accused No.1/ respondent No.2 and the cheques belong to the personal account of the appellant and hence he is not liable for the transaction of the accused No.1 firm. Cheque issued by the appellant is from his personal account and the cheque has been misplaced by the complainant. The appellant is neither a Director nor a Partner of the company. The cheques are issued to the complainant by the appellant towards the advance amount to have building on rental basis, but the complainant has not left out the building and postponed to return the cheques. The appellant has not issued the cheque voluntarily for discharge of legally enforceable debt and hence the provisions of Section 138 of N.i.Act will not attract. The appellant is not at all the partner of the accused No.1 company. When the liability of the appellant could not be established the presumption saying that the cheques 5 Crl.A.No.125/2019 were issued for purchasing of poly bags with the complainant cannot be established against this appellant. The trial Court has not at all discussed the citations referred by the appellant. The trial Court has gravely erred in drawing presumption in favour of the complainant towards legally dischargeable debt in the absence of any material to prove the transaction. Impugned judgment of conviction and order of sentence is perverse. For the aforesaid reasons, appellant has prayed to interfere into the impugned judgment and order and set aside the same.
4. Along with appeal, appellant has produced the certified copy of the judgment and order of conviction dated 19.12.2018.
5. Inspite of service of notices, respondent No.1 and 2 have not appeared before the Court and the respondent No.3 only appeared before the Court through his counsel. Heard arguments. T.C.R. were called for reference in this appeal.
6. Now, following are points that arising for consideration:
1. Whether the Complainant has proved that, the Cheques issued by the Accused No.2 was dishonoured as "funds insufficient" and thereby 6 Crl.A.No.125/2019 the accused No.2 has committed the offence punishable under Section 138 of the Negotiable Instruments Act ?
2. Whether in the light of evidence and material brought before the court, trial court is justified in convicting accused No.1 and 2 for the offence punishable U/s.138 of N.I.Act and sentencing Accused for the said offence?
3. Whether interference of this court is necessitated?
4. What Order?
7. It is answered for the aforesaid points as under:-
Point No.1 : In the Affirmative Point No.2 : In the Affirmative Point No.3 : In the Negative Point No.4 : As per final order below, for the following:-
REASONS
8. POINTS Nos.1 to 3 :- These three points are taken together for common discussions in order to avoid repetition of facts.
7 Crl.A.No.125/20199. Brief facts of the Complainant case is that complainant is a company. The accused No.1 is the partnership firm and accused No.2 and 3 are the partners and they are authorised signatories and responsible for day-to-day business and the transaction of the accused No.1 partnership firm. The complainant is engaged in manufacturing of various plastic allied products. The accused have purchased poly bags of 351.70 Kgs under invoice No.007447 dated 28.11.2014 valued at Rs.2,03,793/- and 1063 Kgs under invoice No.007541 dated 8.12.2014 valued at Rs.1,60,030/- and they have agreed to make payment within 30 days from the date of purchased. The accused after purchasing the materials did not make payment as agreed and they have deferred the payment one or the other pretext. When the complainant demanded to make payment, the accused Nos 2 and 3 on behalf of accused No.1 have issued cheque bearing No.225925 dated 25.02.2015 towards payment of the amount involved under Invoice No.7447 dated 28.11.2014 and cheque No.368159 dated 30.4.2015 towards payment of the poly bags purchased under invoice No.7541 dated 8.12.2014 drawn on State Bank of India, Kengeri Satellite Branch, Bengaluru. The complainant presented the cheque No.225925 dated 25.02.2015 in the 3rd week of March 2015 and the same 8 Crl.A.No.125/2019 was dishonoured with an endorsement dated 16.3.2015 as 'funds insufficient'. After dishonour of the said cheque, the complainant contacted the accused and they have requested the complainant to present both the cheques in the first week of June 2015. The complainant presented both the cheques in the first week of June 2015 and the same were dishonoured with an endorsement dated 5.6.2015 as 'funds insufficient'. After dishonour of the cheques, the complainant issued notice dated 3.7.2015 through RPAD demanding the accused to pay thed cheques amount. The notice sent to the accused No.1 duly served on 6.7.2015 and notice sent to the accused No.2 and 3 returned on 4.7.2015 as 'party not in station'. Even after receipt of the notice, the Accused failed to pay the cheque amount to the Complainant. Therefore, Complainant filed complaint under Sec.200 Cr.P.C for the offence punishable under Sec.138 of N.I Act against the Accused Nos 1 to 3.
10. Perused entire order sheets, complaint filed under Section 200 of Cr.P.C., for the offence punishable under Section 138 of N.I Act, sworn statement of the Complainant by way of affidavit, plea of accusation, examination-in-chief evidence of P.W.1 by way of affidavit, contents of documents at Ex.P.1 to Ex.P18. After closure of the complainant's evidence, statement of the accused as required under section 313 of Cr.P.C was 9 Crl.A.No.125/2019 recorded and the accused denied the incriminating evidence which appeared against them. The accused No.2 and 3 have led defence evidence as DW 1 and 2 and got marked Ex.D1 and 2 documents. During the course of cross examination of DW 1 got marked Ex.C1 and 2 documents. Therefore, there is no procedural defect of any nature while conducting trial relating to private complaint registered for the offence punishable under Section138 of N.I Act.
11. The learned counsel for the accused No.2 submits that the accused No.2 is no way concerned to the transaction with the complainant and the accused No.1 company. Ex.P5 cheque is dated 25.02.2015 and the complainant presented the said cheque to the bank for encashment in the first week of June, 2015. As per the circular dated 04.11.2011 of the RBI with effect from 01.04.2012 reduced the validity of cheque period from 6 months to 3 months. Therefore, the cheque Ex P5 presented beyond 3 months and hence it is out dated cheque and the complaint is not sustainable.
12. The learned counsel for the complainant submits that the complainant has presented the cheque issued by the accused No.2 well within the period of three months. It is his contention that the bank authority have issued the endorsement for dishonouring the cheque for 10 Crl.A.No.125/2019 'insufficient funds' but not for stale cheque. Hence, the cheque is not outdated cheque.
13. On reading the plaint averments, it is clear that the complainant has presented the cheque bearing No.225925 dated 25.02.2015 Ex.P.5 in the 3 rd week of March 2015 and the same was returned on 16.03.2015 as funds insufficient. Therefore, the complainant has rightly presented the said cheque Ex P5 within the period of three months and hence the Ex P5 is not outdated cheque. It is further evident from the averments made in the complaint that he informed the accused persons about the dishonour of the cheque and inturn the accused requested the complainant to present both the cheques Ex.P5 and P6 in the first week of June 2015 and therefore, the complainant presented the said cheque in the first week of June 2015. Further, the State Bank of India, SME branch, Rajajinagar Industrial Estate Branch, Bengaluru issued letter stating that Ex.P5 and P6 cheques presented to the bank on 15.05.2015 within 3 months from the date of the cheque. Further, on perusal of the endorsement, it is clear that the cheque was not dishonoured for stale cheque but it was dishonoured for 'funds insufficient'. Hence, the arguments of the learned counsel for the accused No.2 that Ex.P5 and 6 are outdated cheques, cannot be accepted.
11 Crl.A.No.125/201914. The learned counsel for the accused No.2 further submits that the accused No.2 is no way concerned to the accused No.1 firm and he is not the partner of the accused No.1 firm. In this regard, the accused No.2 in his evidence has also denied that he is one of the partners of the accused No.1 firm. Accused No.3 has been examined as DW 2 who has clearly deposed that he and accused No.2 are the partners of the accused No.1 firm. Further, the complainant company in order to prove that the accused No.2 is the partner of the accused No.1 has got marked a document as Ex.P15. On perusal of Ex.P15 details of accused firm, it shows that the accused No.2 is the partner of the accused No.1 firm. The accused No.2 has not at all disputed Ex.P.15. In the appeal memorandum also he has not disputed Ex.P.15. Therefore, from the oral and documentary evidence, the complainant has successfully proved that the accused No.2 is the partner of the accused No.1 firm.
15. The complainant has produced the invoices Ex.P3 and Ex.P.4, Ex.P.12 and 13. During the course of cross examination, the accused suggested to PW 1 that the invoices at Ex.P3 and P4 are raised in the name of the accused No.1 firm and the materials are purchased from the complainant company on behalf of the accused No.1 firm. Therefore, it is clear that the invoices raised by the accused are on behalf of the accused No.1 firm and the 12 Crl.A.No.125/2019 complainant company supplied the materials to the accused No.1 firm. Therefore, the complainant also proved the supply materials by the complainant company to the accused No.1 firm.
16. The learned counsel for the appellant vehemently argued that the cheques at Ex.P5 and 6 are not belongs to the accused No.1 firm and they are belongs to the personal account of the accused No.2. He has further contended that the cheques at Ex.P5 and P6 are issued to the complainant towards the advance amount to have building on rental basis. But, the complainant has not let out the building and the complainant company misutilised the cheques issued by the accused No.2. In this regard, the accused No.2 has not placed any materials to show that the complainant company has misutilised the cheques Ex.P5 and P6 issued by the accused No.2. It is true that the Ex.P5 and P6 cheques do not belongs to the accused No.1 firm and the same pertains to the savings account of accused No.2 and they are the personal cheques of the accused No.2. In the course of cross examination, PW 1 has stated that the accused have stated that the accused No.1 firm has no amount in its current account and therefore the accused No.2 issued personal account cheques. At this stage, whether the accused No.2 is held liable for the personal account cheques issued towards transactions of 13 Crl.A.No.125/2019 the accused No.1 is the question to be considered. The trial Court in its judgment at page No.17 in para 15 has rightly cited the reportable judgment dated 6.7.2015 passed in Crl.A.No.1472/2009 in the case of Mainuddin Abdul Sattar Sheikh V/s Vijay D.Salvi by the Hon'ble Apex Court. In the said case, the accused issued his individual cheque not in the capacity as a Director of M/s Salvi Infrastructure Private Limited and the said cheque dishonoured and the complainant after issuance of demand notice filed the complaint under section 138 of N.I.Act and the learned Magistrate acquitted the accused and the Hon'ble High Court of Bombay also confirmed the judgment of the trial Court. But the Hon'ble Apex Court convicted the accused for the offence punishable under section 138 of N.I.Act by setting aside the judgment passed by the learned Magistrate and the Hon'ble High Court of Bombay. These facts aptly applicable to the present case. Therefore, the trial court has rightly applied the said citation to the present case. There is no error committed by the trial Court.
17. On perusal of the judgment in para 19, the trial Court has discussed the citations placed by the learned counsel for the accused.
18. It is settled principle of law that the Court cannot read anything into Statute. On bare perusal of 14 Crl.A.No.125/2019 Section 138 of N.I.Act, it shows that when a cheque drawn by a person on an account maintained by him issued to another person for discharge of debt or liabilities in whole or part, cheque is presented the same within 3 months of validity is dishonoured for 'insufficiency of funds' etc., and holder of cheque makes a demand within 30 days of receipt of endorsement from the bank and drawer of the cheque fails to make payment within 15 days from the date of receipt of the notice, then the drawer of cheque said to have committed an offence under section 138 of N.I.Act. In the present case, issuance of cheque by the Appellant from the account maintained by them and dishonour for 'funds insufficient' are not in dispute. It is settled principles of law that once the issuance of cheque is admitted, it is presumed that it is issued for debt or liability, then it is for the accused to rebut the presumption.
19. It is pertinent to note that Hon'ble supreme Court in N.Parameshwaran Unni V/s G.Kannan - 2017(5) SCC 737 it is held that "It is clear from Section 27 of the General Clauses Act, 1897 and Section 114 of the Indian Evidence Act, 1972, that once notice is sent by registered post by correctly addressing to the drawer of the cheque, the service of notice is deemed to have been effected. Then requirements under proviso (b) of Section 138 stands complied, if notice is sent in the prescribed 15 Crl.A.No.125/2019 manner. However, the drawer is at liberty to rebut this presumption." Applying the above said principles to present case, in the present case, as the notice is sent to the above address, it is presumed that notice was duly served. Further, the appellant has not produced any records to show that the appellant has caused any paper publication with regard to change of address of their Firm and communication of the change of address to the respondent/ complainant.
20. The complainant by producing oral and documentary evidence has established that the accused No.2 is the partner of the accused firm. The accused has not denied the signature found on the cheque and counsel for the accused also not disputed the said fact before the trial Court. Since the accused has not denied that he was not signatory to the cheque and considering the facts discussed above, the trial Court has rightly convicted the accused for the alleged offence.
21. Before considering the point whether the Accused has succeeded to rebut the presumptions and established any defence to the extent of probabilities, it is just and necessary to consider whether there is any undisputed facts. It is not in dispute that bounced cheques belong to the Bank account of the Accused. Further, there is no dispute that signature appearing on 16 Crl.A.No.125/2019 the bounced cheques is the signature of the Accused which is signed and issued by the accused No.2 on behalf of the accused firm. Further, dishonour of cheque issued by Accused has been returned by the banker of the Accused for "funds insufficient" is not also in dispute.
22. Grounds of attack set up by the Accused in this appeal is that he didn't issue the cheques for any legally recoverable debt.
23. In addition to that Accused didn't produce any documents to show that, Accused filed any complaint before jurisdictional police against Complainant for misuse of his cheques. Accused did not produce any document to show that he filed private complaint before the jurisdictional Magistrate in this regard.
24. This Court has compared the reasons assigned by the trial court in the impugned judgment of conviction as discussed above with the allegations made in the memorandum of appeal. The trial Court rightly convicted the accused No.2. No grounds are made out in the memorandum of appeal to interfere into the Impugned judgment of conviction.
25. So far as quantum of punishment is concerned, fine of Rs.4,00,000/-(Four lakhs) was imposed for dishonor of a cheque and Rs.3,95,000/-(three Lakhs 17 Crl.A.No.125/2019 ninety five thousand) is ordered to be paid to Complainant by way of compensation. Fine amount imposed is within the purview of Section 138 of N.I.Act. Appellant failed to show that sentence imposed is exhorbitant. Accused/appellant failed to show that quantum of fine imposed is excessive. There is no merit in the appeal. Order under appeal is sustainable in law. Hence, interference of this court is not necessary. Accordingly, point Nos.1 and 2 are answered in the Affirmative and point No.3 is in the Negative.
26. POINT No.4 :- In view of findings on the above points No.1 to 3, this criminal appeal is devoid of merits and same is liable to be dismissed by confirming impugned judgment of conviction and order of sentence. Hence, following order is made:
ORDER Invoking provisions of Section 386 of Cr.P.C., this Criminal Appeal filed U/s. 374(3) is dismissed.
Consequently, impugned judgment of conviction and order of sentence C.C.No.19668/2015 dated 19.12.2018 on the file of court of XXVII Additional Chief 18 Crl.A.No.125/2019 Metropolitan Magistrate, Bengaluru is hereby confirmed.
Appellant/Accused is hereby directed to appear before Trial Court to deposit the fine amount and to serve the sentence.
Office is hereby directed to send back T.C.R. along with certified copy of Judgment to the trial court, forthwith.
(Dictated to the Judgment-Writer directly on computer, script typed by him and corrected, signed and then pronounced by me in the open court on this 01 st day of February, 2022.) Sd/-01.02.2022 (Sadananda Nagappa Naik) LIX ADDL.CITY CIVIL & SESSIONS JUDGE, CCH-60, BENGALURU CITY.