Bangalore District Court
Ltd vs New Marketing D.No.48 on 28 February, 2022
BEFORE THE COURT OF XXIV ADDITIONAL SMALL CAUSES
JUDGE AND THE MOTOR ACCIDENT CLAIMS TRIBUNAL &
A.C.M.M. (SCCH26) AT BENGALURU
DATED THIS THE 28th DAY OF FEBRUARY 2022
PRESENT: SRI.R.MAHESHA. B.A.,L, LLB.,
XXIV ADDL. SCJ &
ACMM & MEMBER MACT
BENGALURU.
1. Sl. No. of the Case CC.No.6133 of 2019
2. The date of 09012020
commencement of
evidence
3. The date of closing 15122021
evidence
4. Name of the M/s Greenchef appliances
Complainant Ltd., Srinivas Industrial
estate
Kanakapura road,
Bengaluru560062
Rep by authorised agent
Sri.Karigowda s/o
Kariappa
(By Sri.L.A.Advocate)
5. Name of the M/s Sri.Sanoshimatha
Accused New Marketing D.No.48
1618
Lalithnagar, Akkayyapale
Vishakapatanam16, A.P.
Rep by proprietors
Srinivasa Rao
(By Sri.H.A.M..Advocate)
6. The offence U/s.138 of the Negotiable
complained of Instruments Act
7. Opinion of the Accused found guilty
judge
JUDGMENT
The complainant filed this complaint Under Section 200 of Cr.P.C against the accused alleging that the accused has committed the offence punishable Under Sec.138 of the Negotiable Instruments Act, 1881. (In short for N.I.Act)
2. The brief facts of the complainant case is as under:
That the accused is customer of the complainant and has purchased goods on credit jointly and severally from 27122017 to 68 2019 and as on day he is due of Rs.10,07,171/ towards principle plus interest at 24% p.a. that the accused has cleared all bills except following invoices i.e., 1. 28092017 Inv GC 2017182269 Rs.5,17,120/ and 2.24092018 GC 2017182084 Rs.5,90,512/. That the accused promised to pay the amount within 1 month but failed to do so and as per terms of invoice he is liable to pay interest and transaction is commercial in nature. That the accused issued following cheques i.e., Cheque No.292352 Rs.9,97,199/ dt.2962019 Andhra bank to the complainant. That the complainant presented the said cheque for encashment, but the said cheque bounced with shara Funds Insufficient/payment stopped by drawer on 682019. That the complainant issued legal notice on 14082019 to the accused. That the accused failed to pay the dishonour cheque amount nor replied to the legal notice. Hence filed this complaint.
3. After filing of this complaint, case was registered as P.C.R. and sworn statement of the complainant was recorded. Thereafter cognizance was taken and registered in Crl.Reg.No.III and summons issued to the accused. In response of summons, accused appeared through his counsel and got enlarged him on bail. The plea was recorded, read over and explained to the accused he pleaded not guilty and claims to be tried. Hence the case is posted for complainant evidence.
4. In order to establish his case, Karigowda authorised person of the complainant company himself examined as PW1 and got marked 12 documents as ExP1 to 12. One Aloo Srinivas Rao got examined as DW1 and got marked ExD1 to 9.
5. Heard oral arguments from complainant and accused counsel. The counsel for complainant has filed detailed written arguments. The accused counsel placed reliance on below decisions :
1. 2009 AIR SCW 1018 (M/s Kumar Exports Vs M/s Sharma Carpets)
2. 2009 (2) KCCR 1132 M/s Target Tours and Travels, Bangalore Vs M/s National Departmental stores, Bangalore and another
3. 2009 (3) KCCR 2188 M/s Matheson Bonsanquet Enterprises Limtied, Bangalore Vs K.V.Manjunatha
4. 2006 SCC online Kar 123 Shryas Agro services private limtied, Bangalore Vs Chandrakumar S.B.
5. ILR 2008 KAR 3635 K.Narayana Nayak Vs M.Shivarama Shetty
6. 2018 (4) KCCR 3674 Branch Manager, PCA & RD Bank Ltd., Belthangady Vs Suresh Das
7. 2018 (4) KCCR 3266 Nagendra credit cooperative society Ltd., Bengaluru Vs J.Nanda Kumar
8. 2013 (3) KCCR 1980 Raghuram V.Shetty Vs K.Kochu Shetty
9. Crl.Apl.No.458/2009 B.L.Karnakar Hegde Vs Shubhakara Shetty
10. 2008 SCC online Kar 444 Sahira Banu Vs Lynal Pinto and another
11. Crl.Appl 425 of 2010 Indus Airway Pvt., Ltd., Vs Magnum Aviation Pvt., Ltd.,
12. crl.Appl No.418 of 2010 A.P.Amith Kumar Vs A.P.Manjunath
13. 2014 AIR SCW 2158 John K.Abraham Vs Simon C Abraham and others
14. ILR 2014 Kar 6572 Sri.H.Manjuanth Vs Sri.A.M.Basavaraju
15. 2022 live law (GU) 730 C.M.Smith and sons Ltd., through denish mohanlal panchal Vs State of Gujarath
6. Upon perusal of the material placed on record, the following points arise for my consideration: POINTS
1. Whether the complainant proves that the accused had issued cheque in question in discharge of the legally recoverable debt as contended by him?
2. Whether complainant proves that the accused has committed the offence punishable under Sec.138 of NI Act?
3. Whether the complainant is entitled for the relief as prayed in the complaint?
4. What order?
7. My answer to the above points is as follows : Point No.1 to 3 :In the Affirmative Point No.4 : As per final order for the following : REASONS
8. POINT NO.1 to 3 : Since these points are interlinked and to avoid repetition they are taken together for common discussion. Before peeping the disputed facts it is appropriate to refer the undisputed facts, which can be gathered from the material placed before this court. On going through the rival contention of the parties, oral and documentary evidence, it is clear that the complainant COMPANY is a registered private limited company. This company authorised one agent Sri.Karigowda S/o Kariyappa. The complainant company doing business in sale of electrical and electronic goods and home appliances goods on cash and credit basis in the said premises. The accused is customer of the complainant company and has purchased goods on credit jointly and severally from 27122017 to 682019. The alleged cheque in question belongs to accused proprietorship and bear signature is also belongs to accused. The complainant company presented cheque for encashment for collection of amount, the same has been got dishonoured for the reasons of Stop Payment/Funds insufficient. Immediately complainant company issued legal notice to accused, same has been duly served, accused did not replied or repaid cheque amount to complainant company.
9. With above admitted facts, now the facts in issue are analyzed, as already stated the accused has denied the entire case of the complainant company as to commission of the offence punishable under section 138 of NI Act. While recording his plea for the said offence and also accused has denied the incriminating circumstance found in the evidence of the complainant. At the time of recording of his statement under section 313 of Cr.P.C., The accused mainly denied the claim of complainant company, on going through the crossexamination of PW1, it is clear that in addition to the total denial of the case of the complainant company, the accused has specifically contended that he was commenced business with complainant company since December 2014, he closed his business with complainant company in the year 2018 due to some service problem from complainant company. He gave two security cheques bearing NO.292351 and 292352 to complainant company in the year 2014 when accused closed his business he had outstanding due towards complainant company of Rs.1,18,000/. The complainant company officials mailed to accused regarding his outstanding due. The accused instructed the complainant company officials to present cheque bearing No.292351 for encashment of Rs.85,000/. Accordingly they presented above cheque and the said cheque honoured and the accused company returned materials worth of Rs.28,000/ to complainant company. The accused had due of Rs.5,000/ towards complainant company. The complainant company gave intimation to accused on 662018 for presenting another security cheque for encashment through Email. He immediately on 972018 requested complainant company officials for return back of his security cheque bearing No.292352,then he instructed to his banker for stopping payment. The specific defence of the accused that on 2842018, he returned materials worth about Rs.6,52,439/ and Rs.2,39,108/ to the complainant company. After receipt of returning materials, the complainant company officials told that the accused had due of Rs.1,18,941/ towards complainant company. He cleared entire outstanding due amount of Rs.1,18,941/ and accused had due only Rs.5,000/ towards complainant company. The complainant company gave return invoice and he produced nine documents in his favour. Therefore, on the above objections the accused seeking the present complaint is not maintainable and liable to be dismissed in limine.
10. It is needless to say that the proceeding under section 138 of NI Act is an exception to the general principle that the accused is presumed to be innocent until the guilty is proved beyond all reasonable doubt. In the proceedings initiated under section 138 of NI Act, proof beyond all reasonable doubt is subjected to presumption envisaged under section 139 of NI Act. Once the requirement of Sec.138 of NI Act is fulfilled, then it has to be presumed that the cheque was issued for discharge of the legally recoverable debt or liability. The presumption envisaged under Sec.139 of NI Act is mandatory in nature and it has to be raised in all the cases on fulfillment of the requirements of Sec.138 of NI Act. In the ruling rendered by Hon'ble Apex Court in the case of Rangappa V/s Mohan reported in AIR 2010 SC (1898) by relying on several rulings rendered by the Hon'ble Apex Court including the case of Krishnajanardhana Bhat V/s Dattareya G. Hegde reported in AIR 2008 SC (1325) it was held that "existence of legally recoverable debt or liability is a matter of presumption under section 139 of NI Act". The Hon'ble Apex Court disapproved the principle laid down in Krishnajanardhana Bhat case that "initial burden of proving existence of the liability lies upon the complainant". In the case of Sri.B.H.Lakshmi Naryana V/s Smt. Girijamma reported in 2010(4) KCCR 2637 it is held that "the presumption that the cheque was issued for legally recoverable debt is to be presumed". Further the Hon'ble Apex Court in Crl. Appeal No.803/2018 Krishna Rao V/s Shankare Gowda reported in 2018(7) SCJ 300 reiterated the above principle further as provided under Sec.118 it is to be presumed that the cheque in question was issued for consideration on the date found therein.
11. In the light of the rival contention of the parties at the outset it is to be determined as to whether the complainant had complied with all the requirements of Sec.138 of NI Act as contended. In order to prove the case of the complainant, one Karigowda S/o Kariyappa authorised person of complainant company examined as PW1 and he reiterated the complaint averments in his examinationinchief by way of affidavit and got documents marked as ExP1 to 12. On the other hand accused No.1 himself examined as DW1 and he produced ExD1 to 9. In addition to that the complainant has produced ExP1memorandum of association and article of association of greenchef appliances Ltd., ExP2original copy fo the board resolution dt.1562019, ExP3authorisation letter dt.1562019. ExP4 cheque dated 1762019 for a sum of Rs.9,97,199/ payee name mentioned as greenchef appliances Ltd., ExP5bank endorsement dt.682019 for reasons of Payment stopped by drawer. ExP6 to 7 original GST invoices, ExP8billwise detail statement, ExP9 ledger a/c statement, ExP10legal notice, ExP11postal receipt,exP12 postal acknowledgment. Due to oversight some documents again overlapped with earlier documents, the said documents referred during course of cross examination. Hence it could not possible to rectify the same. Therefore documents referred in same manner i.e., exP8debit note dt.3152018 (4 in pages). ExP9debit note (3 in pages). ExP10 Mail conversation dt. 19092018.
12. On perusal of complainant oral and documentary evidence, it is clear that the complainant had presented the cheque for encashment within its validity, got issued statutory notice in time and presented the complaint within the prescribed period. So it is clear that complainant complied statutory requirements of presenting cheque, issuing notice and presenting complaint well in time.
13. In order to prove the case of complainant company authorised person Kariyappa examined as PW1 and he produced ExP1 to 12 and he subjected cross examination by accused. During course of his cross examination he mainly questioned about complainant company other directors and the PW1 working in complainant company since 15 years, the present complainant working as Manager in complainant company. At the time of passing resolution, all the directors are present in the company. PW1 admitted that all the directors are not signed for ExP2. One Shuklaji signed on ExP2. The present complainant has been authorised for representing complainant company as authorised by Ex P2. Before preparing this case, the present complainant gave information/instruction to his advocate. In the complainant company one Bharathi looks out a/cs of company and one Yashoda and Manjula they are in company since three years back, they left the job 23 years back. The complainant company doing home appliance business. The present accused got distributorship in the year 2017 till 2019. Before 2017, the accused had business transaction with complainant company, the complainant company appointed accused as dealer in the year 2013. He denied the suggestion of accused that at the time of giving dealership the complainant company took two signed cheques of accused as security. Further PW1 admitted that the complainant company got two signed cheques from accused. The said conversation took place between complainant company officials and accused through Email. The accused success in confronting Email conversation between complainant company official and accused. Further PW1 contended that the complainant company had right to recover amount of Rs.10,07,171/ from accused. The present cheque in question presented for encashment of Rs.9,97,199/. The cheque in question wrote by accused and handover to directors of complainant company. He denied the ink of writings on disputed cheque. Further PW1 stated during course of cross examination that they supplied materials to accused in the year 2017 2018 and he produced invoice pertaining to 20172018, out of that they supplied other materials to accused. According to PW1, the invoice mentioned in ExP7 was correct and some payment made by accused was not mentioned in ExP9 and further he denied other suggestions of accused that the accused had cleared entire due towards complainant company and accused returned defect materials a worth of Rs.28,297/ in Vishakapattanam executive. Further he denied the suggestion of accused, the complainant company communicate through Email to accused for return of cheque bearing No.292352 through one Krishna and later it is misused by complainant company and filed false case against this accused. Further PW1 admitted that there is no signature of accused on ExP7 and he denied other suggestions putforth by accused during course of cross examination clearly and categorically denied.
14. It is well settled principle of law through catena of decisions that though the statutory presumptions available under Sec.118 and 139 of NI Act are mandatory in nature, they are the rebuttal one. It is needless to say that when the complainant proves the requirement of Sec.138 of NI Act the onus of proof shifts and lies on the shoulder of the accused to rebut the presumptions available in favour of the complainant. It is the accused who has to rebut the presumptions with all preponderance of probability with clear, cogent and convincing evidence though not beyond all reasonable doubt. The accused has to make out probable defence by producing convincing acceptable evidence and thereafter only burden shifts on the shoulder of the complainant. It is also settled law that to rebut the presumption, the accused can also rely upon presumptions available under the Evidence Act. It is also set in rest that in order to rebut the presumption it is not imperative on the part of the accused to step into the witness box and he may discharge his burden on the basis of the Acts elicited in the crossexamination of the complainant. It is also equally true that, if the accused places such evidence so as to disbelieve the case of the complainant, then the presumptions stand rebutted. This view is also supported with the decisions of the Hon'ble Apex Court reported in 2006(3) SCC (CRL) 30 Tamilnadu Marcantile Bank Limited V/s M/s Subbaiah Gas Agency and others. ILR 2009 (2) 1633 Kumar Exports V/s Sharma Carpets, AIR 2008 SCC 1325 Krishnajanardhana V/s Dattareya G. Hegde, 2013 SCR (SAR) CRI 373 Vijay V/s Lakshman & another and AIR 2010 SC 1898 Rangappa V/s Mohan and Crl. Appeal No.230 & 231/2019 Bir Singh V/s Mukesh Kumar. Now the question that would arise is whether the accused has rebutted the statutory presumptions available in favour of the complaint.
15. In order to disprove the case of complainant and prove his defence the accused orally examined before this court as DW1 and he specifically deposed before this court that he was commenced business with complainant company since December 2014, he closed his business with complainant company in the year 2018 due to some service problem from complainant company. He gave two security cheques bearing NO.292351 and 292352 to complainant company in the year 2014 when accused closed his business he had outstanding due towards complainant company of Rs.1,18,000/. The complainant company officials mailed to accused regarding his outstanding due. The accused instructed the complainant company officials to present cheque bearing No.292351 for encashment of Rs.85,000/. Accordingly they presented above cheque and the said cheque honoured and the accused company returned materials worth of Rs.28,000/ to complainant company. The accused had due of Rs.5,000/ towards complainant company. The complainant company gave intimation to accused on 662018 for presenting another security cheque for encashment through Email. He immediately on 972018 requested complainant company officials for return back of his security cheque bearing No.292352,then he instructed to his banker for stopping payment. The specific defence of the accused that on 2842018, he returned materials worth about Rs.6,52,439/ and Rs.2,39,108/ to the complainant company. After receipt of returning materials, the complainant company officials told that the accused had due of Rs.1,18,941/ towards complainant company. He cleared entire outstanding due amount of Rs.1,18,941/ and accused had due only Rs.5,000/ towards complainant company. The complainant company gave return invoice. In addition to that he produced ExD1 to 11 documents. ExD1 to 3Email conversation between complainant company officials and accused proprietorship dt.662018 (2 in Nos) and 892021. ExD4ledger a/c statement of accused proprietorship from 1 42017 to 2842018. ExD5sales register of accused proprietorship which is maintained by accused from 242018 to 3042018. ExD6tax invoice dt.2852018, ExD7 and 8tax invoice dt.2642018, ExD9 consignor copy dt.2952018, ExD10stop payment instructions given by accused, ExD1165B certificate. The DW1 has been subjected cross examination by complainant. During course of cross examination he specifically admitted that at the time of getting distributorship there is a written contract entered between accused and complainant company. The said agreement was with the custody of complainant company. There is no document from accused to show the said agreement was with the custody of complainant company. Further DW1 denied the suggestion of complainant that is there is any entries made in written agreement regarding the complainant company got two security cheques from accused. The accused answered he did not know about such statement recorded in written agreement. Further he stated that they made note in written agreement regarding issuance of security cheque from accused to complainant company and he mainly relied mail sent by complainant company officials, they stated they got two cheques and one was presented for encashment of Rs.85,000/ and another one handover to one Krishna to return to accused. Further DW1 clearly admitted that he had business transaction with complainant company from 2014 to 2017 and further he deposed that they maintained a/c till May 2018. Further he deposed and undertook during course of cross examination that he would produced his proprietorship a/c statement. Further DW1 clearly admitted that he did not produced any document which is pertaining to Email conversation between accused and complainant company officials to show before this court the two security cheques took from complainant company in the year 20142015. Further DW1 deposed that he sent returned materials worth of Rs.9 lakhs through Tata Ace vehicle. Further accused contended during course of cross examination that the said material were received by one Almond Krishna and Srinivas. Further DW1 admitted that they not given any acknowledgment for receiving materials worth of Rs.9 lakhs. Further DW1 admitted that the complainant company sent a materials as per Ex D9 and further clearly admitted that one Almond Krishna and Srinivas were not authorized by the Greencheff appliances for receiving returned materials from accused. Further DW1 admitted that ExD3 was not belongs to accused Email. Further DW1 denied the seal and signatures of his proprietorship on debit notes and he contended that the said debit note are raised at the time of receiving materials from complainant company. Further accused admitted that he maintained ledger a/c statement for receiving materials from complainant company and returning materials to complainant company and he undertook before court he would produce he maintained ledger statement for inspection of this court. Further he undertook that he can produce his statement from 1042018 to 682019. Further DW1 denied the suggestion of complainant that he intentionally produced half statement in order to avoid debit note entry of complainant company. Further DW1 clearly admitted that cheque in question and bear signature is belongs to him and address mentioned in ExP10 and 12 is correct. Further he denied he did not aware about bounce of cheque and he denied the signature on ExP12 was not belongs to him. Further accused contended that he locked his shop since 262018. Therefore he did not received any notice from complainant company. Further DW1celarly admitted that he did not took any legal action against complainant company for misusing his cheque even accused returned materials to complainant company. Further DW1 clearly admitted that he did not replied statutory notice issued by complainant company. Further accused contended that he did not aware about this case, he came to know about this case through one distributor in the year December 2019, after that he appeared before this court his advocate verified court file, then he came to know about dishonour of his cheque and present case. Further DW1 clearly admitted that on 1552018, upon the instructions of accused, the complainant company presented cheque and encashed of Rs.85,000/ from accused a/c. Further he admitted that on 762018, the accused returned materials worth of Rs.20,000/ to complainant company. Further accused denied the suggestion of complainant that even accused instructed to the complainant company for presenting cheque in question and he made possible efforts to bounce the cheque in question. Further accused denied the suggestion of complainant that he did not returned any goods or materials to complainant company in order to cheat complainant company the accused deposed false evidence before this court and other suggestions putforth by complainant counsel are clearly and categorically denied by accused .
16. On careful analyze entire evidence and documents, it is clear that the complainant has produced many documents to show or substantiate complaint averments as on the date of issuance of cheque or prior to issuance of cheque, the legally recoverable debt exist between complainant and accused. Complainant produced ExP1 to 12 and ExP8 to 10. On careful perusal of entire exhibits, it disclose that ExP4cheque dated 1762019 for a sum of Rs.9,97,199/ payee name mentioned as GreenCheff appliances Ltd.,. The said cheque issued by accused on behalf of proprietor of Sri.Santhoshmatha New marketing. The accused was a signatory to cheque in question. ExP5bank endorsement dt.682019 for reasons the reasons of Payment stopped by drawer. ExP10legal notice dt.13082019 issued upon the instruction of complainant company to accused. ExP11postal receipt, in ExP12 postal acknowledgment, the accused himself put his signature and put his proprietorship seal. The complainant company produced ExP6 and 7 it is forthcoming that the complainant company raised invoice through purchase order by accused G.C./SO/2303/1718, G.C./SO/2297/1718 through lorry receipt No.053801 dt.28092017 and they supplied materials worth of Rs.5,90,512/ to Santhosh Matha New Marketing, door No.49/16/18 Lalithanagar, Kayyapalem, Vishakapattanam, Andra pradesh. Further it is forthcoming from ExP7 that upon the purchase order issued by accused. The main defence of the accused is that he purchased material as per invoices produced by complainant company, but after some time, he returned materials worth about Rs.6,52,439/ and Rs.2,39,108/ and cleared balance outstanding due of Rs.1,18,941/. Therefore accused had no due towards complainant company. The complainant company misused his signed security cheque which was given at the time of getting distributorship from complainant company. The onus now shifted on accused to substantiate he returned materials in two occasion and cleared entire outstanding due towards complainant company. Admittedly there is no documentary proof or acknowledgment for receiving materials from accused to complainant company. Even accused returned materials in two occasions, the complainant company misused his security cheque, but accused did not took any legal action against complainant company for misusing his signed security cheque. During course of cross examination of DW1, the complainant clearly suggested to DW1 regarding above aspect, he clearly admitted he did not took any legal action against complainant company. The relevant cross examination portion extracted here: ನ ವಪಸಕಳನಹಸದದರರ ಚಕಕನನ ನನನ ಪರರದನದರರಗ ಮಟಟರಯಲಲ ಗಳನನ ನ ಏಕ ಬಬಬಕಗ ಹಜರನಪಡಸದರ ಎಬದನ ಲಖತವಗ ಬರದನ ಕಳನಹಸಲಲ . ನನನ ಪಪಕರಣದ ಬಗಗ ತಳದನಕರಬಡನ ನಬತರ ಇಲಯವರಗರ ಪರರದನದರರ ಮಟಲ ನನನ ಚಕಕನನ ನ ದನರನಪಯಗ ಮಡಕರಬಡದರ ಎಬದನ ವಕಟಲರ ಮರಲಕ ನರಟಟಸ ಕರಟಟಲಲ ಮತನತ ರವದಟ ಕನರನನ ಕ ಕಮ ಕಕಗರಬಡಲಲ. ದನಬಕ 762018 ರಬದನ 20,00000 ಮಲಬದ ಮಟಟರಯಲಲ ಗಳನನ ನ ನನನ ಕಬಪನಗ ವಪಸ ಕರಟಟದನ ಎಬದರ ಸರ. ಆಲಲಬಡಕಕಷಷ ಮತನತ ಶಪಟನವಸನನನ ವಪಸಕಳನಹಸದದ ಮಟಟರಯಲಲ ನ ವಶಖಪಟಟಣದ ನನನ ಕಛಟರ santoshi matha new marketing door No.49, ಗಳನನ 16/18, akkaiah pelam, Vishakapattanam ಸಸಸಟಕರಸದರ. ಆಲಲಬಡ ಕಕಷಷ ಮತನತ ಶಪಟನವಸ ನನಗ ಸಸಟಕಕತ ಕರಡಲಲಲ. ಆಲಲಬಡ ಕಕಷಷ ಮತನತ ಶಪಟನವಸರವರನ ನ ವಪಸ ಪಡದನಕರಳಳಲನ greencheff appliance ರವರಬದ ಮಟಟಟರಯಲಲ ಗಳನನ ಅಧಕರ ಪಡದಲಲ.
17. So above admission of DW1 clearly demonstrate that the accused has failed to prove the return of goods to complainant company in his evidence. No where he has stated that the mode under which the goods have been returned. The accused has admitted that he has not send the goods to complainant at Bangalore and in cross examination he takes a stand for first time that the goods were returned to representative of complainant firm at Vishakapattanam. To the contrary, the complainant company had made entry of invoices in their statement of accounts and since the accused failed to deliver the goods which he had promised to return as per invoices. The complainant after repeated request the accused failed to return the goods as raised debit note from complainant company. The accused has not produced any document to show that goods were delivered to complainant company or to the alleged persons. The say of accused cannot be believed that he has returned Rs.8,91,547/ worth goods without any authorization or acknowledgment. The accused has not produced any document to show that he has delivered the goods to complainant company worth of Rs.8,91,547/ from Vishakapattanam to Bangalore. The accused clearly admitted during course of cross examination he would produce his company a/c statement from 1042018 to 782019, but he intentionally did not produced complete statement of accused firm/proprietorship. The accused has produced half a/c statement of his a/c only till date for his convenience and he has not downloaded entire statement of a/c of complainant showing raising of debit note and return of cheque. Further accused has failed to show before this court he returned materials and cleared entire outstanding due towards complainant company through cogent and believable evidence. Therefore the defence of accused can taken after thought.
18. Further the main defence of accused is that no notice has been served on accused, he came to knew about this case through one distributor in Vishakapattanam, accused voluntarily appeared before this court and he instructed his advocate for verifying case details, then he came to know about this case. Therefore on this score he prayed for dismissal of this complaint. In this background, this court meticulously perused ExP12, it clearly disclose that the accused himself put his proprietorship seal and made his signature on 1982019. The accused in his evidence deposed before this court that no notice has been served on accused. During course of cross examination in page 7 at 18 th line DW1 clearly admitted that the address mentioned on ExP10 and 12 correct address of his proprietorship. Further accused admitted in 17 th line of cross examination in page7 that ಕ ಮತನತ ಅದರ ಮಟಲರನವ ಸಹ ನನಗ ಸಟರದ ಎಬದರ ಸರ. ವವದತ ವವದತ ಚಕನ ಕ ಅಮನಬವಗದ ಎಬದರ ಸಕ ನರಟಡ ನನಗ ಗರತತಲಲ ಎಬದನ ಹಟಳನತತರ . ನ.ಪ.10 ಚಕನ ರಲರನವ ವಳಸ ಸರ ಇದ. ನ.ಪ.12 ರ ಮಟಲರನವ ಸಹ ನನನದಲಲ. ನ.ಪ.12 ರಲ ಬರದರನವ ವಳಸ ಸರ ಇದ. ನನನ ಅಬಗಡಯಲ ನನನನನ ನ ಬಟನ ಟ ಬಟರ ರರರ ಪತ ಕ ಸಸಟಕರಸನವದಲಲ.
19. The above admission fo dW1 clears this minds of court that the cheque in question and bear signature was belongs to accused, the cheque in question on presentation got dishonoured for the reason of Stop Payment by the drawer. The accused himself stated before this court the complainant company misused his security cheque. Therefore he instructed bank for not honour cheque and he himself produced Ex D10, on 972018, the accused himself instructed to his bank for stop payment advice for a/c number 008211100000496 and for cheque No.292352. To the contrary he deposed during cross examination the cheque in question got bounced but he did not aware about bounce of cheque. The accused himself admitted before this court the address mentioned in exP10 and 12 are correct address of accused and ExP12 clearly disclose accused proprietorship seal and signature the accused took defence before court the signature found on exP12 not belongs to him, the onus shifted on accused to prove above facts before this court, but accused no documents produced to substantiate his defnece. Therefore in the absence of material evidence from accused, this court came to conclusion that accused failed to establish before this court, no notice has been served on accused as putup by accused. Therefore this court did not accept his defence and rejected.
20. The main defence of the accused is that the complainant company got his two cheques for security purpose one cheque was presented by complainant company and withdrew amount of Rs.85,000/ upon th einstructions of accused. But another cheque in question of this case misused by complainant company without the instructions of accused. No doubt now recent view of Hon'ble Apex court in Further Hon'ble Apex court in a recent decision of Hon'ble Supreme Court of India in Sripathi Singh Vs State of Jarkhand 2021 SCC 1002 clearly held that " a cheque issued as security pursuant to a financial transaction cannot be considered as a worthless piece of paper under every circumstances "Security" in its true sense is the state of being safe and the security given for a loan is something given as a pledge of payment. A cheque issued as a security, it is given, deposited or pledged to make certain the fulfillment of an obligation to which the parties to the transaction are bound. If in a transaction, a loan is advanced and the borrower agrees to repay the amount in a specified time framed and issues a cheque as security to secure such repayment if the loan amount is not repaid in any other form before the due date or if there is no other understanding or agreement between the parties to defer the payment of amount, the cheque which is issued as security would mature for presentation and the drawee of the cheque would be entitle to present the same. On such presentation, if the same is dishonoured, the consequences contemplated u/s 138 and the other provisions of NI Act would flow".
21. The Hon'ble Apex court clearly held even cheque issued for security purpose, the said cheque got dishonoured the situation attrack section 138 of NI Act and burden on accused to prove he cleared loan amount/outstanding due amount to the complainant. If accused able to prove before court, he cleared entire due even though he cleared entire due amount or loan amount, if complainant uses security cheque the prosecution against accused fail. In view of the principle of law laid down by Hon'ble Apex court, no doubt complainant can utilise security cheque for encashment of outstanding due amount. The burden on accused to prove he cleared entire outstanding due amount. In the instant case, the accused contended that he returned materials worth of Rs.8,91,547/ to the complainant company and he cleared remaining outstanding due amount of Rs.1,18,941/, the accused contended only due towards complainant company of Rs.5,000/. But accused failed in proving his defence by leading cogent and believable evidence. Therefore the accused contention did not sustainable.
22. The cheque is an instrument comes under the N.I Act holder in due course of the cheque, has got good title over the cheque. Therefore on the basis of evidence of PW1 and documentary evidence it clearly establish that the accused issued the disputed cheque to the complainant company for legally dischargeable debt. The complainant company has complied all essential ingredients of Sec.138 of NI Act. When complainant company complied all essential ingredients of Sec.138, as per Sec.139 of NI Act the cheque is issued for legally recoverable debt.
23. On careful examination of all the documents of complainant, it is very clear that the complainant private limited company filed this complaint well within time and complied all the ingredients of Section 138 of N.I. Act 1881. The presumption Under Section 139 of the NI Act is a presumption of law, it is not a presumption of fact. This presumption has to be raised by the court in all the cases once the factum of dishonor is established. The onus of proof to rebut this presumption lies on the accused. The standard of such rebuttable evidence depends on the facts and circumstances of each case. Such evidence must be sufficient to prove the case. Therefore a mere explanation is not sufficient to rebut this presumption of law. It is profitable to refer and relied Hon'ble Apex court recent decision passed in Criminal Appeal No.123/2021 arising out of special leave petition (criminal) 1876/2018 between M/s Kalamani Tex and another Vs P.Balasubramanian disposal date on 1002 2021 (three judges bench). In this case, Apex court held that, "once signature on cheque admitted by the accused, court ought to have presume that, cheque was issued as consideration for a legally enforceable debt."
24. It is pertinent to refer and relied Hon'ble Apex court recent decision passed in Criminal Appeal No.292/21 between Sumethi Vij Vs. M/s Paramount Tech FAB Industries (Division Bench) disposed dated 9.3.2021 In this case Apex Court held that under Section 139 of the Act, a presumption is raised that holder of a cheque received the cheque for the discharge, in whole or in part, of any debt or other liability. To rebut this presumption, facts must be adduced by the accused which on preponderance of probability (not beyond reasonable doubt as in the case of criminal offence. Must then be proved.
25. Further Apex court clarified that there is a mandate of presumption of consideration in terms of the provision of the Act under Section 118 and 139 of Negotiable Instrument Act. The onus shifts to the accused on proof of issuance of cheque to rebut the presumption that the cheque was issued not for discharge of any debt or liability in terms of section 138 of the NI Act.
26. As per N.I. Act, the presumption is in favour of holder of cheque. Here, the holder of cheque is complainant private limited company and presumption is in favour of complainant private limited company. It is burden on the accused to rebut the above presumption. As per Section 118 of N.I Act, presumption has to be raised by the court in all the cases once the factum of dishonour is established, but it is rebuttal presumption. The onus of proof to rebut this presumption lies on the accused. The standard of such rebuttal evidence depends on the facts and circumstances of each case. Such evidence must be sufficient, cogent and should prove beyond any reasonable doubt. The accused has not taken and proved defence to rebut the presumption of law available in favour of the complainant envisaged U/s 118 r/w section 139 of NI Act. Accordingly the case of the complainant private limited company is acceptable as the complainant private limited company has proved that accused has intentionally without having sufficient money in his account and issued disputed cheque. Therefore, a mere explanation is not enough to repel this presumption of law. The counsel for accused relied many decisions of Apex court and Hon'ble High Court of Karnataka, this court with due respect to the Hon'ble Apex court decision perused proposition of law and kept in mind in view of recent principle of law laid down by the Hon'ble Apex court above stated decisions the principle of law laid down in relied decisions of accused did not helpful, because the accused himself clearly and categorically admitted before this court that cheque in question and bear signature is belongs to him, the statutory notice issued by complainant company duly served on him, on the other hand, accused took specific contention that the complainant company misused his security cheque and accused cleared entire outstanding due towards complainant company, the accused only due of Rs.5,000/ to complainant company, but accused failed in proving his defence by leading cogent and believable evidence. Therefore this court did not accept the defence of accused. Moreover Hon'ble Apex court clearly recently held that once issuance of cheque admitted the consideration is also passed along with cheque there is no necessity to doubt about complainant case and the burden is on accused to prove he cleared entire due or loan amount to complainant. Further it is burden on accused to prove or explained before court in what circumstances, his signed cheque goes to possession of complainant, but in the instant case, accused failed in discharge his onus and burden to explain above facts. Therefor ethe decisions relied by accused would not helpful to his case.
23. Therefore in my considered view, the complainant private limited company has established his case by way of documentary as well as oral evidence. Being accused liable to pay outstanding due amount of Rs.9,97,199/ to the complainant private limited company . Hence my answer to point No.1 to 3 in the Affirmative.
27. Point No.4: Since this court has already held that the cheque in question was issued towards discharge of legally enforceable debt and the accused has committed an offence U/s 138 of NI Act. It is worth to note that the offence is of the nature of civil wrong. This court has power to impose both sentence of imprisonment and fine on the accused. This court is of the opinion that it is appropriate to impose the sentence of fine only on the accused, instead of sentencing him to undergo imprisonment. Hon'ble supreme court of India in a decision reported in 2015(17) SCC 368 in a case of H.K.Pukhraj Vs D.Parsmal observed that having regard to the length of trial and date of issuance of cheque it is necessary to award reasonable interest on the cheque amount along with cost of litigation. By considering this case, length of trial and nature of business, this court came to conclusion, it is just and proper to grant reasonable interest along cheque amount in favour of complainant company, it would meets ends of justice. In the result, I proceed to pass the the following:
-: ORDER :-
By Acting U/s 255(2) of Cr.P.C the accused is hereby convicted for the offence punishable U/s 138 of NI Act.
The accused is hereby sentenced to pay fine of Rs.11,45,000/ (Rupees eleven lakhs forty five thousand only) and acting U/s 357(3) of Cr.P.C. out of the total fine amount payable by the accused a sum of Rs.11,40,000/ shall be payable to the complainant as compensation and remaining amount of Rs.5,000/ shall be defrayed as state expense.
In default of payment of fine the accused shall under go simple imprisonment for a period of 6 months.
It is further made it clear that if the accused opt to undergo imprisonment, it does not absolve him from liability of paying compensation to the complainant.
Office is hereby directed to supply free certified copy of this judgment to the accused forthwith.
(Dictated to the stenographer, through online computer, thereof is corrected and then pronounced by me in the open Court on this the 28th February 2022) (R.MAHESHA) XXIV ADDL. SMALL CAUSES JUDGE & A.C.M.M. BENGALURU.
ANNEXURE WITNESSES EXAMINED ON BEHALF OF THE COMPLAINANT:
PW1: Kari Gowda DOCUMENTS MARKED ON BEHALF OF THE COMPLAINANT: Ex.P.1 Incorporation certificate Ex.P.2 Resolution Ex.P3 Authorisation letter Ex.P4 Cheque, Signature as ex.P4(a) Ex.P5 Bank endorsement Ex.P6 and 7 GST invoice Ex.P8 Bill wise details Ex.P9 Ledger account Ex.P10 Legal notice Ex.P11 Postal receipt Ex.P12 Postal acknowledgment WITNESSES EXAMINED ON BEHALF OF THE ACCUSED: DW1 : Aloo Srinivas Rao DOCUMENTS MARKED ON BEHALF OF THE ACCUSED: Ex.D.1 Email conversation dated 06062018
Ex.D.2 Ledger account statement from April 01 2017 to 28042018 Ex.D.3 Sales register statement from 01042018 to 30042018 Ex.D.4 Tax invoice dated 28052018 total 9 pages Ex.D.5 Tax invoice dated 2604 2018 total 3 pages Ex.D.6 Tax invoice dated 26042018 total 2 pages , Ex.D.7 Consigner copy dated 29052019 Ex.D.8 Original copy of letter given by accused to Bank Ex.D.9 Certificate u/s 65B of IE Act (R.MAHESHA) XXIV ADDL. SMALL CAUSES JUDGE & A.C.M.M. BENGALURU.