Bangalore District Court
Dr Suryanarayana vs J Chandrashekaran on 23 July, 2024
KABC030573672019
IN THE COURT OF THE XIX ADDITIONAL CHIEF
JUDICIAL MAGISTRATE AT BENGALURU CITY.
Dated this the 23rd day of July 2024.
PRESENT:SRI.SOMANATHA, B.A.Law.,LL.B.,
XIX ADDL.C.J.M., BENGALURU.
Case No. :- C.C.No.18162 of 2019
Complainant :- Mr.D.R.Suryanarayana,
S/o. Sri.L.Ramakrishnappa,
55 Years, R/at.No.1521, 'Sahane'
5th A Main, WOC Road, 2nd Stage,
Mahalakshmipuram,
Bengaluru-560 086.
(By Sri.V.C.C., Advocate)
-V/s-
Accused :- Mr.J.Chandrasekaran,
S/o.Sri.Jagadeesan, 62 Years,
R/at.No.4127, Janapriya Bharath
Enclave, 4th Block, Sunkadakatte,
Magadi Main Road,
Bengaluru-560 091.
i
(By Sri.G.S., Advocate)
2 C.C./18162/2019
Date of filing of :- 17-05-2019
complaint
Offence complained of :- Under Section 138 of N.I.Act.
Date of :- 08-08-2019
commencement of
recording evidence
Date of closing of :- 10-06-2024
evidence
Opinion of the Judge Found guilty.
JUDGMENT
The complainant has filed a complaint against the accused under Section 200 of Cr.P.C., for the offence punishable under Section 138 of N.I.Act.
02. The case of the complainant is as follows:
The accused is a known person to the complainant since several years and both possess a cordial and healthy relationship. On the guise of the said relationship the accused approached the complainant in the month of July -2016 and requested to lend hand loan of a sum of Rs.5,00,000/- assuring to repay the same within one
3 C.C./18162/2019 year with interest at 2% percent per month. The complainant knowing the financing difficulties been faced by the accused in connection to an apartment though of helping him out and accordingly, in response to his request lent a sum of Rs.5,00,000/- by way of cash on 25-07-2016 at the residence of the complainant. After receiving money from the complainant the accused cleared the pending loan amount in Janatha Seva Co- operative Bank Ltd., Mahalakshmipuram Branch and forgot to repay to the complainant his amount thereafter.
03. The complainant next contended that the complainant after running behind the accused for two years requesting to refund the amount, the accused has issued cheque bearing No.000057 dated:28-02-2019 for a sum of Rs.5,00,000/- drawn on HDFC Bank, Vijayanagar branch, Bengaluru, with reassurance to pay the interest amount within a short time and assured to the 4 C.C./18162/2019 complainant that the cheque will be honoured on its presentation.
04. The complainant next contended that as per assurances of accused, he presented the cheque for encashment through his banker viz., Janatha Seva Co- operative Bank, Mahalakshmipuram Branch, Bengaluru on 20-03-2019, the same came to be dishonoured with endorsement dated:21-03-2019 stating "Funds Insufficient".
05. The complainant next contended that after the receipt of the endorsement from the bank, he was constrained and got issued legal notice to the accused through his counsel on 01-04-2019 by way of R.P.A.D calling upon him to pay the cheque amount and the same was duly served upon accused. Despite, the accused neither paid the cheque amount nor replied the notice. Thus, the accused committed an offence 5 C.C./18162/2019 punishable under Section 138 of Negotiable Instruments Act. Hence, filed the present complaint.
06. After presentation of the complaint, the cognizance was taken for the offence punishable U/Sec.138 of Negotiable Instruments Act. Upon receiving the sworn statement on affidavit, documents and having been found sufficient material to proceed against accused criminal case was registered against the accused and process was issued. In pursuance whereof, the accused appeared and enlarged on bail, accusation read over and explained to the accused, to which he pleaded not guilty and claimed to be tried.
07. Thereafter, the sworn statement treated as chief-examination of PW-1 and got marked Ex.P1 to Ex.P.8 documents at trial. On closure of complainant side evidence, the accused was examined under section 313 of Cr.P.C. The accused had denied the incriminating 6 C.C./18162/2019 materials against him in evidence. The accused examined himself as DW-1 and no documents were marked.
08. Heard arguments on both sides. Defence counsel has produced three decisions which are as follows:
1. Dashrathbhai Trikambhai Patel Vs. Hitech Mahendrabhai Patel and another (Criminal Appeal No. 1497 of 2022).
2. (K.Subramani Vs. K.Damodara Naidu (Criminal Appeal No.2402/2014).
3. Rajesh Jain Vs. Ajay Singh (Special Leave Petition (Crl.) No.12802/2022).
09. The points that arise for consideration are as follows:
I. Whether the complainant proves that, the accused issued a cheque bearing No.000057 dated:28-02-2019 for a sum of Rs.5,00,000/- in order to discharge the existence of legally enforceable debt 7 C.C./18162/2019 or other liability in favour of the complainant and the same was returned unpaid with remarks funds insufficient and thereby accused has committed an offence punishable under Section 138 of N.I. Act.?
II. What order.?
10. My findings on the aforesaid points are as under:
Point No.1:- In the Affirmative. Point No.2:- As per final order for the following;
::REASONS::
11. Point No.1:- The complaint version is that the accused lend hand loan of Rs.5,00,000/- agreeing to repay the same within one year together with interest at 2% per month, the complainant and accused are known to each other, the accused borrowed a sum of Rs.5,00,000/- financial necessities from complainant on 25-07-2016, the complainant after running behind the accused for a period of two years requesting to refund the 8 C.C./18162/2019 amount, later accused had issued cheque of Rs.5,00,000/-, cheque came to be dishonoured on account of Funds Insufficient when it presented for encashment by complainant, though the accused acknowledged the receipt of legal notice, the accused neither replied nor complied with the demand made in the legal notice.
12. The defence on the part of the accused is that complainant is his known person, complainant use to come to his house as a friend regularly advising in PF and ESI matters, complainant misused the blank signed cheque which was kept in his house, the complainant fill- up the cheque and presented to the bank.
13. There can be no dispute that complainant and accused are well known to each other. The complainant tendered the evidence that when the accused came to his house, the accused handed over the cheque, he work as 9 C.C./18162/2019 a Labour Law Consultant, after getting to know the accused, accused came to his office for consultation, his association with complainant was from 12 years, about the matter of consultation there were transaction between accused and himself several times. From the above, it is clear that complainant has demonstrated that how the complainant and accused are well known to each other. Complainant has also demonstrated that they are in close contact since 12 years.
14. The complainant is very particular that in 2016 he had a salary around Rs.40,000/- to Rs.50,000/- per month. He is submitting Income Tax Returns from 12 to 13 years. Thus, it is clear that complainant was capable of lend in a loan of Rs.5,00,000/- to the accused.
15. Complainant said that he mentioned in the Income Tax Returns that he gave Rs.5,00,000/- in cash to the accused. The accused testified that it is seen in the 10 C.C./18162/2019 Income Tax Returns that complainant paid money in his favour but it is questionable document and he will check it. A combined reading of the evidence of the complainant and accused, I conclude that complainant had disclosed the payment of Rs.5,00,000/- to the accused in the Income Tax Returns. Accused for the convenience sake said that the Income Tax Returns is a questionable document he will check it but he has not made any efforts to demonstrate Income Tax Returns of complainant is a questionable document. In view of the above, I am of the opinion that complainant lend a loan of Rs.5,00,000/- in favour of accused is beyond doubt.
16. The complainant said that he wrote only name in the cheque when he presented it for encashment. The accused said that date, amount in numbers and words and signature on the blank cheuqe done by him and he did not mention the beneficiary name in the cheque. The accused admits that cheque is related to his bank 11 C.C./18162/2019 account and the signature on the cheque is his. It is settled principle law that when the cheuqe is signed leaving blank all other particulars and handed over to payee authorizing him to fill up the blanks as agreed upon it is valid in law. Therefore, when such a cheque is dishonoured section 138 applies. Here in this case, the complainant only written name in the cheque and the accused filled up the rest of the contents of the cheque and subscribed signature on the cheque. Thereby, when the cheque came to be dishonoured on presentation to the bank for encashment by complainant section 138 of N.I Act will came into play.
17. The crucial defence on the part of the accused is that complainant had misused blank signed cheque which was kept in his house. The accused admits that no police complaint has been given to the police station saying cheque has been misused by the complainant, no private complaint has been given to the court saying 12 C.C./18162/2019 cheque has been misused by the complainant and no legal notice has been issued saying cheque has been misused by the complainant. A careful analysis of the defence evidence referred supra it is quite manifest that if really the complainant had misused blank signed cheque which was kept in his house the accused would not have kept silent without taking legal action against the complainant. Thus, defence raised by the accused that complainant misused the blank signed cheque which was kept in his house must fail.
18. After seeing the letter of repayment of loan it was identified by the accused and it was marked as Ex.P.6. It is found in the Ex.P.6 that "I promise you to return cheque amount by Monday. I return cheque of No.000057 dated 20-03-2011 of Rs.5,00,000/- and another City Union Bank for Rs.5,00,000/- I will pay the total amount of Rs.10,00,000/- before Monday evening". This is a letter communication took place between the 13 C.C./18162/2019 complainant and accused. The accused admits that cheque bearing No.001208 of City Union Bank and his signature there on. Cheque marked as Ex.P.7 and signature on cheque marked as Ex.P.7(a). The accused admits that when Ex.P.7 presented to the bank it came to be dishonoured on account of Payment Stopped by Drawer. Return memo marked as Ex.P.8. Thereby, one thing is clear that accused had handed over another cheque of Rs.5,00,000/- for repayment of due amount but it came to be dishonoured on account of Payment Stopped by Drawer on presentation to the bank for encashment by complainant. Letter correspondence took place between the complainant and accused marked at Ex.P.6 would indicate that the accused had issued Ex.P.1 and 6 towards the amount due to the complainant. The accused testified that he gave cheuqe for a financial adjustment, he does not take any legal action when it was found in the bank statement that Ex.P.7 cheque was 14 C.C./18162/2019 presented to the bank. The accused admits that when cheque bounced complainant has given notice and after the notice was given no action was taken and after the case was filed in the court he took it seriously. A careful scrutiny of the defence evidence one could find that it is not only dishonour of Ex.P.7 cheque found on the bank statement but also the complainant gave notice when the cheque Ex.P.7 bounced. The accused simply said that after the case was filed in the court he took it seriously. Say of the accused is that even after receipt of notice no action was taken against the complainant does not repose confidence in the mind of the court that accused had issued Ex.P.7 cheque for financial adjustment to the complainant. Why the accused had taken cheque from complainant is strengthened letter communication took place between the complainant and accused marked at Ex.p.6. The accused said that there is no amount due so that Ex.P.6 letter is not presented to the court and 15 C.C./18162/2019 missed to mention in his chief examination about the complainant finance business, giving cheque and giving letter of repayment of loan to the complainant to save his skin. The accused said that no action was taken against the accused when cheque bounced because complainant was his friend and since the complainant is his friend he has not complained about Ex.P.6 document written by the complainant and has not been questioned in any court. As I stated supra, it is not only Ex.P.6 cheque bounced but also complainant gave notice to the accused. It was an indication that complainant is going to file cheque bounce case against the accused based on Ex.P.7 cheque. Having knowledge of complainant is going to file cheque bounce case against accused based on Ex.P.7 no prudent man will remain silent without taking any legal action telling that complainant and himself are friend. Therefore, say of the accused is that he has not taken any legal action against complainant when Ex.P.7 16 C.C./18162/2019 cheque bounced and on receipt of statutory notice from the complainant is far away from truth. Further, it is the defence of the accused that complainant is financier, complainant has no licence to conduct money lending business, complainant does finance transaction and the complainant took the cheque for it. Such being the case, the accused conscious that complainant is going to file cheque bounce case when Ex.P.7 cheque came to be dishonoured and complainant sent a statutory notice. If in case, the complainant and accused are really such a close friends, the Ex.P.7 cheque bounce would not have went up to issuance of statutory notice to the accused. Thereby, say of the accused that after the case was filed in the court he took it seriously cannot accepted. The accused testified that he made stop payment as the amount is not due. Ex.P.7 cheque came to be dishonoured on account of Payment stopped by drawer. Validity, truthfulness and genuineness of the Ex.P.6 17 C.C./18162/2019 remains undisturbed. Accused's his own admission would indicate that owe a sum of Rs.10,00,000/- to complainant. Thereby, say of the accused is that he made stop payment as the amount is not due is uncredence worth.
19. The accused has testified that he was living at the address mentioned in the chief examination since 17 years, the address mentioned in the notice is his, signature on the postal acknowledgment is his, no reply was given after serving the notice, after reaching the notice he came to know the contents. Thereby, service of statutory notice to the accused cannot be doubted.
20. It is true that complainant admits there is a difference between the ink of cheque and ink of signature. It is apparent from the material available on record that the accused has singed and written every thing except the name of beneficiary in the cheque.
18 C.C./18162/2019 Thereby difference between the ink of cheque contents and signature would not negate the complaint case.
21. Presumption is drawn that accused has issued the cheque in favour of complainant for valid consideration as provided U/s.118 of N.I.Act 1881. Further, presumption is drawn that accused has issued the cheque in favour of the complainant about existence of legally enforceable debt. The accused failed to raise probable defence.
22. The offence punishable under section 138 of N.I Act, be punished with imprisonment for a term which may extent to two years or with fine which may extent to twice the amount of cheque, or with both. The yardstick for the imposing of sentence for the offence punishable under section 138 of NI Act, is duration of pendency of the cheque bounce case, if the amount has been deposited in the bank, the complainant would have earn 19 C.C./18162/2019 the interest on principal sum, the accused even not easily amenable to the court so the accused caused loss to the state for securing. The object of the section 138 of N.I Act is penal introduced in civil nature. It is a commercial offence. Therefore, the main object of the 138 of NI Act is only to recover the money. If the complainant deposited Rs.5,00,000/- in the nationalized bank, definitely he would have earned interest on the principal sum. The canotation rule of Dumdupath signifies that the interest shall not exceed the principle sum. The case is pending 17-05-2019. Therefore, it is just and necessary to impose interest of 10% on the principal sum for the period of Five Years 2 Months. The state took drastic step to secure the presence of accused before the court. Thus, the state is also to be compensated out of the fine amount towards the expenses meted out to secure the presence of the accused. Thereby, complainant could able to establish that the accused has committed an 20 C.C./18162/2019 offence punishable under section 138 of Negotiable Instruments Act, 1881. Accordingly, I answer Point No.1 is in the Affirmative.
23. Point No.2:- In view of the discussions made in Point No.1, I pass the following;
ORDER In exercise of power conferred under section 255(2) of Cr.P.C., the accused is convicted for the offence punishable under Section 138 of Negotiable Instruments Act,1881.
The accused is sentenced to pay an amount of Rs.7,63,500/-, in default, he shall undergo simple imprisonment for six months.
The accused shall pay fine of Rs.7,63,500/- out of which an amount of Rs.7,58,500/- shall be paid to the complainant as compensation as provided under section 357(1)(b) of Cr.P.C. and 21 C.C./18162/2019 Rs.5,000/- shall be remitted to the State Exchequer as fine amount.
It is made clear that even if, the accused undergone sentence in default of payment of fine, the accused is not absolved from liability to pay fine as contemplated under proviso attached to section 421 of Cr.P.C. Office is directed to supply free copy of this Judgment to the accused.
(Directly dictated to the Stenographer transcribed by her, corrected by me and then pronounced in the Open Court on 23 day of July 2024) rd (SOMANATHA) C/c. XIX ADDL.C.J.M., Bengaluru.
:ANNEXURE::
1.List of Witnesses examined on behalf of the Complainant:
PW1 :- D.R.Suryanarayana.
2.List of Documents marked on behalf of the Complainant:-
Ex.P1 :- Cheque,
Ex.P1(a) :- Signature of Accused,
Ex.P2 :- Bank Endorsement,
Ex.P3 :- Office copy of the Legal notice,
22 C.C./18162/2019
Ex.P4 :- Postal Receipt,
Ex.P5 :- Postal Acknowledgment,
Ex.P6 :- Letter dated:21-03-2019,
Ex.P7 :- Cheque,
Ex.P7(a) :- Signature of Accused,
Ex.P8 :- Bank Memo.
03.List of Witnesses examined on behalf of the Defence:-
DW1 :- J.Chandrashekaran.
04.List of Documents marked on behalf of the Defence:-
-NIL-
(SOMANATHA) C/c. XIX ADDL.C.J.M., Bengaluru. 23 C.C./18162/2019