Bangalore District Court
M/S. N.P.S. Constructions vs Shri. T.A. Krishna Murthy on 5 August, 2021
IN THE COURT OF LXV ADDL CITY CIVIL AND SESSIONS
JUDGE; BANGALORE CITY
PRESENT
SRI. SUBHASH SANKAD
B.A., LL.M.
LXV Addl. City Civil & Sessions Judge,
Bengaluru.
Dated this the 5th day of August, 2021
CRL.A.No.492/2020
PETITIONER/S : M/S. N.P.S. CONSTRUCTIONS,
# Old No.287/1, New No.128,
13th Cross, Sarakki Gate,
Kanakapura Road,
Bengaluru 560078.
Rep. by its Proprietor,
Shri. V. Prasanna Kumar Setty.
(By Sri. SGP., Advocate)
V/s.
RESPONDENT/S: SHRI. T.A. KRISHNA MURTHY,
s/o late T.S. Adimurthaiah Setty,
# 401, 3rd Floor, 'Samruddi Nivas'
4th Cross, 3rd Main Road,
R.K. Layout, 2nd Stage,
Padmanabhanagar,
Bengaluru 560070.
(By Sri. TCR., Advocate)
2
Crl.A.No.492/2020
JUDGMENT
This appeal is filed by the appellant under Section 374(3) of Cr.P.C., seeking to set aside the Judgment of conviction and sentence passed by the XVI Additional Chief Metropolitan Magistrate, Bengaluru, in CC.No.11807/2014 dated 10.01.2020.
2. The appellant is the accused and the respondent is the complainant before the trial Court, for the sake of convenience parties are referred by their ranks before the trial Court.
3. The facts of the case are as follows. The complainant had executed guarantee agreement for Housing Loan availed by the accused from Bank of India, Malleshwarama, Bengaluru along with his wife i.e., P.Swarnalatha and his son Chethan Krishna in the year 2009 and he has received several notice from the said bank for nonpayment of the installments and final notice during October 2012, failing payment of arrears of the bankers have initiated rigorous action on him because he has executed guarantee agreement to the said bank, to safeguard his position has paid a sum of Rs.11,13,010.14 till date to the Bank of India towards Housing loan of the accused i.e., he has paid the payment an amount of Rs.4,94,053.72ps recovered from his FD with Bank of India on 28.01.2013 and an amount of Rs.18,956.42ps recovered from his interest amount on the said FD with Bank of India on 28.01.2013 and has paid an amount of Rs.6,00,000/ through DD bearing No.031290 of IndusInd Bank, Basavanagudi, Bengaluru and in all total an amount of 3 Crl.A.No.492/2020 Rs.11,13,010.14ps paid by him and the accused is also aware of the promising of repayment of the said amount paid by him. It is further stated that the in order to repay the said amount paid by him had issued a cheque bearing No.512389 dated 18.03.2013 for RS.10,00,000/ in favour of the complainant. The complainant presented the said cheque for encashment and the same were returned with endorsement "Insufficient Funds". The fact of dishonor of cheque was informed to the accused, since the accused did not make the payment the complainant got issued demand notice calling upon the accused to make payment within 15 days. Since the accused did not make payment. Hence, the complainant has filed the complaint.
4. The trial court took cognizance of offence and issued summons to accused. The accused appeared through his counsel and defended the case. The trial court recorded the plea of accusation. The accused pleaded not guilty of the accusation levelled against him and claimed to be tried. Hence, the case was posted for trial.
5. To prove his case, the complainant was examined himself as PW1 and got marked the documents as Exs.P1 to 7. After completion of the evidence, the trial court examined the accused as required under Section 313 of Cr.P.C. The accused denied the incriminating evidence and he was examined as DW1 and got marked the document at Ex.D1 to Ex.D14. After hearing 4 Crl.A.No.492/2020 both the side, the trial court passed the judgment, convicting the accused and sentenced him to pay a fine of Rs.10,10,000/.
6. Being aggrieved by the judgment passed by the trial court, the appellant herein has filed the present appeal challenging the impugned judgment on various grounds.
7. I have heard the argument of both the side, gone through the trial court records, the impugned judgment of conviction and the grounds urged in the appeal. Now the points that arise for my consideration.
1. Whether the impugned judgment of conviction is illegal and erroneous?
2. Whether the appellant has made out any grounds to interfere with the impugned judgment of conviction and sentence?
3. What Order?
8. My findings on the above points are. Point No.1: In the Negative Point No.2: In the Negative Point No.3: As per the final order for the following REASONS
9. Points No.1 & 2: Since these two points are interconnected with each other, for the sake of convenience, I have taken these points together for discussion and answer.
10. The present appeal is filed on various grounds.
5Crl.A.No.492/2020
11. Before adverting to the grounds urged in the appeal memo, it is necessary to mention here the facts which are required to be proved successfully to prosecute the drawer for an offence punishable under Section 138 of the Negotiable Instrument Act.
a) That the cheque was drawn for payment of money to another person for discharge of debt of liability and the cheque was dishonored;
b) That the cheque was presented to the bank within a prescribed period
c)That the payee made a demand for the payment by giving notice in writing to the drawer within a stipulated period; and
d) That the drawer failed to make the payment within 15 days of the notice.
12. Since this is the first appellate court, it is necessary to reappreciate the facts and evidence on record. It is specific case of the complainant that the accused had availed housing loan of Rs.10,00,000/ from the complainant and in order to repay the said amount the accused had issued the cheque in question which came to be dishonored after presentation. Though, the demand notice was issued to the accused, he has not paid the loan amount. Hence, he has filed the complaint.
13. In order to substantiate his case, the complainant was examined himself as PW1 and got marked the documents at Ex.P1 6 Crl.A.No.492/2020 to Ex.P7. Ex.P1 is the cheque, Ex.P1(a) is the signature of the accused, Ex.P2 is the bank memo, Ex.P3 is the office copy of legal notice, Ex.P3 is the postal receipt, Ex.P4 is the courier receipt, Ex.P6 is the postal acknowledgment and Ex.P7 is the MOU. The careful perusal of the evidence and materials placed by the complainant show that the presumption goes in his favour. The finding of the trial court in this regard is correct.
14. The accused has been examined as DW1. He has stated in his evidence that he had executed marketing agreement to sell the flats made by him to the complainant. Later due to mis management and misappropriation made by the complainant with him he had no option except to enter into Memorandum of Understanding dated 09.11.2011 with regard to settlements of several financial issues that arose in the course of business run by them under the name and style of 1) M/s. Samruddhi Shelters Pvt. Ltd., 2) M/s. TrustNGain Investors Services Pvt. Ltd., 3) M/s. TrustNGain @ Partnership Firm (regarding online share & commodities trading business), 4) M/s. N.P.S. Constructions, before the advocate Shri. B.K. Narendra Babu who drafted the Memorandum of Understanding got signed the same from the complainant and himself. The said Narendra Babu kept the Memorandum of Understanding with him along with original documents such as signed and unsigned cheques, marketing agreement of MOU dated 16.12.2008, settlement agreement dated 17.09.2012 and other agreements with proposed buyers along with 7 Crl.A.No.492/2020 accounts books, vouchers, bills, computerized accounts statements etc.,
15. He further states that the complainant has also given an acknowledgment with regard to the custody of the original documents. He further states that he is not liable to pay any amount to the complainant as alleged in the complaint. As per the MOU dated 09.11.2011 the complainant had agreed to pay Rs.4,00,00,000/ to him out of the project of building apartments in M/s. Samruddhi Shelters Pvt. Ltd., along with clearing the bank loan of Bank of India, Malleshwarama Branch, Bengaluru. However, the complainant has misused the original documents long with cheque in question drawn on Indian Bank, by colluding with advocate Shri. B.K. Narendra Babu. He has further states that the complainant has filed several civil cases against him.
16. He further states that he is not liable to pay any money to the complainant and he has produced the documents marked at Ex.D1 to Ex.D14. Ex.D1 is the certified copy of the acknowledgment, Ex.D2 is the deed of settlement agreement dated 17.09.2012, Ex.D3 is the deposition of examinationinchief of plaintiff in OS No.3258/2013, Exs.D4 & 5 are the certified copies of the examinationinchief and crossexamination of the accused in OS No.1714/2013, Ex.D6 is the certified copy of examinationin chief of plaintiff in OS.No.6721/2012, Exs.D7 & 8 are the certified copies of the examinationinchief and crossexamination in CC 8 Crl.A.No.492/2020 No.12645/2014, Ex.D9 is the certified copy of the complaint in CC No.10189/2014, Ex.D10 is the certified copy of the examinationin chief of complainant in CC No.10189/2014, Exs.D11 &12 are the certified copies of the complaint in CC No.9266/2014, Exs.D13 & Ex.D13(a) & (b) are the certified copies of the cheque and bank memo and Ex.D14 is the certified copy of the order sheet in CC No.1610/2014. However, in the crossexamination the accused has admitted the receipt of money from the complainant. He further admits that he has borrowed loan of Rs.15,00,000/ from Bank of India for which the complainant has became guarantor. He further clearly admits that it is the complainant who has repaid the amount of Rs.10,00,000/ to the bank borrowed by him for the repayment of which he has issued the cheque. When there are admissions with regard to issuance of cheque towards payment of the amount which was paid by the complainant, towards bank loan borrowed by the accused, it cannot be said that the contention raised in the evidence of the accused are not believable. This defense raised by the accused does not constitute a probable defense. More so, it is necessary to refer the judgment passed by the Hon'ble Apex Court in Rangappa Vs. Sri Mohan reported in AIR 2010 SC 1898 wherein the Hon'ble Apex court has held that 'the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. This is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence 9 Crl.A.No.492/2020 wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant.
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 instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused/defendant cannot be expected to discharge an unduly high standard or proof.
In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under Section 139, the standard of proof for doing so is that of `preponderance of probabilities'. Therefore, if the accused is able to raise a probable defense which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As 10 Crl.A.No.492/2020 clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defense and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own.
17. In the light of the above mentioned observation, I am of the opinion that when the accused has admitted his signature at Ex.P1(a) the presumption under Sections 118 and 139 of the Negotiable Instrument Act, would goes in favour of the complainant the defense raised by the accused does not constitute a probable defense since there are no supportive evidence and other materials available on record to believe his version. Therefore, I am of the opinion that the trial court has rightly appreciated and evaluated the evidence of PW1 in proper perspective. As such there is no illegality or error committed by the trial court in this regard, and the impugned judgment passed by the trial court does not call for interference by this court. Accordingly, I answer points No.1 and 2 in the 'Negative.'
18. Point No.3: In view of my findings on point No.1 & 2, I proceed to pass the following. ORDER The appeal filed by appellant under Section 374(3) of Code of Criminal Procedure is hereby dismissed.
11Crl.A.No.492/2020 The impugned judgment of conviction and sentence passed by the XVI Additional Chief Metropolitan Magistrate, Bengaluru, in CC.No.11807/2014 dated 10.01.2020 is hereby confirmed.
Send a copy of this judgment to the trial Court along with TCR forthwith.
(Dictated to the stenographer, transcribed by her, corrected and then pronounced by me in the Open Court on this 5th day of August, 2021) (SUBHASH SANKAD) LXV Addl. City Civil & Sessions Judge, Bengaluru.