Bangalore District Court
Sri. Naresh Kumar vs Sri. Sathish Kumar Kannan on 10 January, 2020
IN THE COURT OF XXI ADDL.CHIEF METROPOLITON
MAGISTRATE, BENGALURU CITY
Present: Sri. V. NAGARAJA, LL.B., LL.M.,
XXI Addl. Chief Metropolitan Magistrate,
Bengaluru.
Dated this the 10th day of January, 2020
C.C. No.23828/2018
COMPLAINANT: Sri. NARESH KUMAR
S/o. Krishnamurthy,
Aged about 29 years,
R/at. No.6/1, 3rd Main,
7th Cross, Chinnappa Garden,
Benson Town Post,
Jayamahal Extension,
Bengaluru - 560 046.
(Reptd. By: CNG., Advocate)
V/s.
ACCUSED: Sri. SATHISH KUMAR KANNAN
S/o. Jayadev,
Aged about 38 years,
R/at. No.20/A, 1st Main,
2nd Cross, L.N. Reddy Garden,
Kariyanapalya,
Lingarajapuram,
Bengaluru - 560 084.
And also at:
Admin Manager,
Save by Switching Global
Solutions Pvt. Ltd.,
Maruthi Chambers,
2nd Floor, 17/9C,
Left Wing, Roopena Agrahara,
Hosur Road,
Bengaluru - 560 068.
(Reptd. By: MS., Advocate)
2 C.C.No.23828/2018
:JUDGMENT:
Complainant has filed this complaint under Section 200 of Cr.P.C. r/w Section 138 of N.I. Act, seeking for penalizing the accused for the offence punishable under Section 138 of N.I. Act and also for awarding compensation to him.
2. Case of the complainant in a nutshell is that:
He and accused are good friends as well as colleagues, working in Ways 2 Save Consultancy Pvt. Ltd., Bengaluru. So, in that acquaintance, accused had approached him by stating that he had good contacts with BBMP contractors and officials. So that, they can start some BBMP works, which would give good income and sought financial assistance for his business as well as legal requirements. So, believing the words of the accused, he paid sum of Rs.19,00,000/- way of cash as well as some of the amount transferred to the account of accused through NEFT, whereas accused after receiving the said amount, he assured to repay the same within a period of one year.3 C.C.No.23828/2018
3. It is further averred that in the year 2016, the complainant quit his job in above said Ways 2 Save Consultancy Pvt. Ltd., and started to work in Hyderabad location. Later, he came to know that accused had no contact with BBMP contractors or officials to get any contract work. So, in the year 2018, he started to demand for repayment of above said Rs.19,00,000/-, whereas accused one or other pretext, he went on postponing the same. Ultimately, in order to discharge above said liability, accused has issued him two cheques bearing No.000040 dated 08.06.2018 for Rs.9,00,000/- and another cheque bearing No.000041 dated 08.06.2018 for Rs.10,00,000/- both are drawn on HDFC Bank Ltd., Richmond Road Branch, Bengaluru and assured to honour the said cheques. So, believing the words of the accused, he presented above said cheques on 08.06.2018 through his banker i.e., HDFC Bank, Nandi Durga Road Branch, Bengaluru. But said cheques were dishonoured for the reason "Funds Insufficient" in the account of accused. So, the bank authorities issued endorsement dated 11.06.2018. So, he got issued legal notice dated 19.06.2018 through RPAD to accused regarding dishonour of cheques and called him to pay cheques amount, 4 C.C.No.23828/2018 whereas said notice has been duly served on accused on 26.06.2018, but accused instead paying cheques amount, he gave untenable reply and he has failed to pay the cheques amount. Hence, accused has committed offence punishable U/s.138 of NI Act. Hence, he is constrained to file this complaint seeking for penalizing the accused for the offence punishable under Section 138 of N.I. Act., and also seeking for awarding of compensation to him.
4. In pursuance of summons issued by this court, accused made appearance through his counsel and obtained bail and now he is on bail.
5. As these proceedings are summary in nature, substance of accusation read over and explained to accused in language known to him whereas, he pleaded not guilty and claimed for trial.
6. In order to prove the case of the complainant, he has been examined as PW-1 and got documents marked Ex.P-1 to Ex.P-13. After completion of evidence of complainant, statement of accused as specified U/s.313 of Cr.P.C., has been recorded and he has been examined as DW-1 and got documents marked Ex.D-1 to Ex.D-5. 5 C.C.No.23828/2018
7. I have heard arguments of both learned counsels, whereas both learned counsels filed their written arguments, whereas learned counsel for accused filed memo of citations.
8. Perused the records.
9. After perusal of records, the points arise for my consideration are:
1) Whether complainant proves beyond all reasonable doubt that accused in order to discharge his legally enforceable debt or liability, he has issued him two cheques bearing No.000040 dated 08.06.2018 for Rs.9,00,000/- and another cheque bearing No.000041 dated 08.06.2018 for Rs.10,00,000/- both are drawn on HDFC Bank Ltd., Richmond Road Branch, Bengaluru?
2) Whether complainant further proves that he has complied with mandatory requirements as specified under Section 138 of N.I. Act?
3) What Order?
10. My findings on the above points are:
Point No.1 : In the Negative
Point No.2 : Does not survive for Consideration
Point No.3 : As per final order,
for the following:
REASONS
11. Point No.1: As I have already stated, in order to prove the case of the complainant, he has been examined as PW-1 and he filed his examination-in-chief by way of 6 C.C.No.23828/2018 affidavit by reiterating entire complaint averments as stated above. In support of his oral testimony, he relied upon Ex.P-1 to Ex.P-13.
12. On the other hand, accused has been examined as DW-1 and got documents marked Ex.D-1 to Ex.D-5.
13. Before appreciation of evidence of both parties, I am of the opinion, it is worth to note presumptions envisaged in N.I. Act as well as ratio laid down by the Hon'ble Apex Court in Three Judges Bench Judgment reported in (2010) 11 SCC 441 (Rangappa V/s. Sri Mohan) wherein it is held:
"The presumption mandated by Section 139 includes a presumption that there exists 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 wherein the existence of a legally enforceable debt or liability can be contested. However, herein, there can be no doubt that there is an initial presumption which favours the respondent /complainant."
It is further held:
Once the cheque relates to the account of the accused and he accepts and admits the signatures on the said cheque, then initial presumption as contemplated under Section 139 of the Negotiable Instruments Act has to be raised by the court in favour of the complainant. The presumption referred to Section 139 of the NI Act is a mandatory presumption and not a general presumption, 7 C.C.No.23828/2018 but the accused is entitled to rebut the said presumption.
14. So in the light of above presumptions and ratio decidendi laid down by Hon'ble Apex Court, if the present facts and situations are analyzed, it is obvious that according to complainant, accused has issued cheques for discharging of his liability. On the other hand, on considering the evidence of accused, it is obvious that though he disputes his liability as claimed by complainant, but he is not disputing the facts that cheques are belonged to his account and they bear his signatures. So, as I have already stated in view of ratio laid down by Hon'ble Apex court in the Judgments stated supra, that as soon as accused admits the facts that cheque is belonged to his account and it bears his signature, then the mandatory presumption u/S 139 of N.I. Act comes to the aid of complainant and he can rest upon said presumption.
Now the crucial question arises as to whether accused is able to rebut the said presumption or not?
15. It is significant to note on considering the stand taken by the accused in his defence evidence, he contended that there was no existence of legally 8 C.C.No.23828/2018 enforceable debt or liability to an extent of Rs.19,00,000/- as claimed by complainant. He further contended in fact admittedly, as he and complainant being colleagues, in the year 2016, they discussed to start business. So, both complainant and accused contacted their friend Mr. Inder, who introduced his friend Mr. Mosha Chinnaiah to them. So, all four persons planned to start up a business with BBMP. So, Mr. Inder and Mr. Mosha Chinnaiah took the responsibility to get project work from BBMP and also to get it executed. He further contended that Mr. Inder and complainant colluded together and without any legal paper work or without consent of the accused, one fine day, the complainant had transferred Rs.9,48,000/- from his HDFC Bank account to Mr. Inder's YES Bank account. Later, above said Mr. Inder and Mr. Mosha Chinnaiah had instructed the complainant to transfer the amount of Rs.6,45,000/- to the account of accused. So, complainant only transferred Rs.6,45,000/- to his (accused's) account, whereas accused out of above said Rs.6,45,000/-, he transferred Rs.2,35,000/- to the account of Mr. Inder as instructed by complainant. Later, as the said Mr. Inder and Mr. Mosha Chinnaiah did not get work from BBMP. So, accused get recovered Rs.1,65,000/- only from Mr. 9 C.C.No.23828/2018 Inder and repaid Rs.4,19,500/- to complainant through his HDFC Bank. So, he was only due of Rs.2,25,500/- to the complainant. However, the accused requested the complainant that both of them can file a case against Mr. Inder for recovery of money, but complainant colluded with Mr. Inder, he has not joined with the accused to file a case for recovery of said amount. However, the accused returned entire amount of Rs.2,25,500/- to complainant by way of monthly equal installments @ Rs.20,000/- per month, he cleared entire balance of Rs.2,25,500/- to complainant. Such being so, the complainant in order to grab money from him, on 07.06.2018, complainant and his friends came to his house and assaulted him and threatened him and forcibly took his three blank cheques and signed blank stamp paper. So, he lodged compliant against complainant on 15.06.2018 before Banasawadi Police, whereas police enquired him and above said Mr. Inder @ Indresh, whereas Mr. Inder assured to repay the amount of Rs.9,48,000/- to complainant which was borrowed by said Mr. Inder from the complainant. Such being so, now in order to grab money from him, complainant misused said cheques by filling up the contents of the same for his convenience and also created 10 C.C.No.23828/2018 Ex.P-11 on his signed blank stamp paper and filed this false complaint. Hence, present complaint is liable to be dismissed and he may be acquitted.
16. In support of above defence, learned counsel for accused argued that presumption envisaged under Section 139 of N.I. Act is rebuttable presumption. So, initially court can raise such presumption if there is no dispute with respect to signature of the drawer. However, accused can rebut the said presumption by raising probable and acceptable defence and standard of proof required by the accused to rebut the said presumption is only preponderance of probabilities. So, he can rebut the presumption by contesting on the fact of existence of legally enforceable debt to an extent of Rs.19,00,000/- as claimed by complainant.
17. He further argued that herein this case, admittedly, there is no financial transaction between complainant and accused to an extent of Rs.19,00,000/-. In fact, admittedly complainant had transferred Rs.9,48,000/- to the account of Mr. Inder @ Indresh and complainant only transferred Rs.6,45,000/- to his account, out of which he transferred Rs.2,35,000/- to the 11 C.C.No.23828/2018 account of Mr. Inder @ Indresh as per the instruction of the complainant and he recovered Rs.1,65,000/- from said Mr. Inder @ Indresh. Thereafter, he repaid entire amount to complainant by way of transfer of money as well as by way of cash. So, question of legally enforceable debt/liability to an extent of Rs.19,00,000/- does not arise. So, when the version of complainant itself that there is no financial transaction between him and accused to an extent of Rs.19,00,000/-, then from this fact itself the initial presumption comes to an end and onus shifts on the complainant to prove the liability of the accused independently without the aid of presumption. He further argued that keeping apart the presumption, the complainant has not pleaded and produced any cogent and convincing evidence as to how the accused is liable for the alleged amount of Rs.19,00,000/-. He further argued that complainant has forcibly obtained signed blank cheques of the accused and also signed blank stamp paper and filled up the cheques for his convenience and fabricated the stamp paper as Ex.P-11 and gave false evidence. Hence, complainant is guilt of perjury and criminal action has to be initiated against complainant and 12 C.C.No.23828/2018 present complaint is liable to be dismissed and accused may be acquitted.
18. In support of his arguments, he placed reliance upon the judgments of Hon'ble Apex Court as well as Hon'ble High Courts.
1. (2009)2 SCC 513 4. AIR 1964 SC 725
2. (2015)1 SCC 99 5. AIR 1978 SC 1753
3. AIR 2008 SC 278 6. 1977 Crl.L.J. 1367
19. Per contra, learned counsel for complainant argued that when accused is not disputing facts that cheques are belonged to his account and they bear his signatures, then mandatory presumption shall draw in favour of the complainant that he has received the cheques for legally enforceable debt. He further argued that though the complainant transferred Rs.9,48,000/- to the account of Mr. Inder @ Indresh, but said amount is transferred as per instructions of the accused and accused has admitted the entire liability of Rs.19,00,000/- and executed acknowledgement as per Ex.P-11 and in order to pay said amount to complainant, accused issued the 13 C.C.No.23828/2018 present cheques. Hence, accused is liable for prosecution U/s.138 of NI Act.
20. He further argued that story created by the accused that present cheques have been obtained by force from him cannot be believable and acceptable. Moreover, when accused admitted the signature on Ex.P-11, he cannot now contend that it has been fabricated. On the other hand, the facts and circumstances of the case clearly prove the version of the complainant that accused has issued present cheques to discharge the liability. Hence, accused is liable to be convicted and maximum sentence may be imposed.
21. Having regard to the arguments of both counsels, before appreciating the defence of accused, it is worth to note the standard of proof required by accused to rebut the mandatory presumption already raised in favour of complainant.
22. At this juncture, it is worth to note ratio laid down by Hon'ble Apex Court in the above said Rangappa V/s. Mohan's case wherein Hon'ble Court held that: 14 C.C.No.23828/2018
"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 defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own"
23. At this juncture, it is also worth to note judgment of Hon'ble Apex Court reported in (2013)3 SCC 86 (Vijay V/s. Laxman and another) where it is held:
"Case set up by holder of cheque itself dubious, thus, held, initial presumption itself comes to an end"
It is further held that:
"Though the evidential burden is initially placed on the defendant by virtue of Section 118 it can be rebutted by the defendant by showing a preponderance of probabilities that such consideration as stated in the pronote, or in the suit notice or in the 15 C.C.No.23828/2018 plaint does not exist and once the presumption is so rebutted, the said presumption "disappears". For the purpose of rebutting the initial evidential burden, the defendant can rely on direct evidence or circumstantial evidence or on presumption of law or fact. Once such convincing rebuttal evidence is adduced and accepted by the Court, having regard to all the circumstances of the case and the preponderance of probabilities, the evidential burden shifts back to the plaintiff who has also the legal burden"
24. In the light of above ratio decedendi, if the present facts and situations are analyzed, it is important to note, the complainant in his cross-examination, he clearly admitted that:
"£Á£ÀÄ ºÉZï.r.J¥sï.¹. ¨ÁåAPï£À°è SÁvÉ ºÉÆA¢zÉÝãÉ"
"£Á£ÀÄ ¸ÀzÀj EAzÉæñïgÀªÀjUÀÆ ¸ÀºÁ ªÉÄÃ¯É ºÉýzÀ ºÉZï.r.J¥sï.¹. ¨ÁåAPï SÁvɬÄAzÀ 9.5 ®PÀë gÀÆ¥Á¬Ä Dgï.n.f.J¸ï. ªÀÄÆ®PÀ DvÀ£À SÁvÉUÉ ªÀUÁðªÀuÉ ªÀiÁrzÀÄÝ ºÁUÀÆ D£ÀAvÀgÀ ¸ÀzÀj EAzÉæñïUÉ 5 ®PÀë gÀÆ¥Á¬Ä £ÀUÀzÀÄ ºÀt £Á£Éà RÄzÀÄÝ ¤ÃrgÀÄvÉÛãÉ. £Á£ÀÄ ¸ÀzÀj EAzÉæñïgÀªÀjUÉ 16 C.C.No.23828/2018 ºÀt ªÀUÁðªÀuÉ ªÀiÁrzÀÝ §UÉÎ £À£Àß ¨ÁåAPï ¸ÉÖÃmïªÉÄAmï ºÁdgÀÄ¥Àr¹zÉÝãÉ"
25. It is further significant to note, on perusal of Ex.P-12 which is bank account statement of complainant also reflects the above his version that he has transferred Rs.9,48,000/- to the account of Mr. Inder @ Indresh. So, from the above oral and documentary evidence of the complainant himself, it is crystal clear that he has not paid Rs.19,00,000/- to the accused as claimed by him in his complaint. So, admittedly, when there is no financial transaction to an extent of cheque amount Rs.19,00,000/- between complainant and accused, then the initial presumption raised in favour of complainant comes to an end and disappears, thereby presumption is rebutted.
26. So, now the doctrine of reverse burden comes in to picture that is to say onus of proving of the fact of liability of the accused to an extent of amount covered under the cheques i.e., Rs.19,00,000/-, shifts on the complainant and he has to prove the same independently without the aid of presumption, because presumption has already rebutted by the accused as observed by Hon'ble Apex Court in the above said judgment Vijay V/s. Laxman and another.
17 C.C.No.23828/2018
27. It is significant to note as I have already pointed out, admittedly, there is no direct financial transaction between complainant and accused to an extent of Rs.19,00,000/- thereby presumption is rebutted. So, under such circumstances, complainant must specifically plead and prove as to how and in what manner accused is liable for the alleged amount covered under the cheques i.e., Rs.19,00,000/-. It is significant to note, complainant contended in his complaint regarding the alleged liability of the accused that in the year 2016, accused approached him for financial assistance of Rs.19,00,000/- to get BBMP work. So, on the basis of his request, he paid Rs.19,00,000/- to the accused by way of cash and part payment by way of NEFT. But, it is significant to note, he neither pleaded nor proved regarding details of said loan transaction that is to say on what date, he paid amount and how much of amount, he paid by way of cash and how much of amount, he transferred through NEFT etc. So, in absence of such material particulars regarding alleged loan of Rs.19,00,000/-, it strikes at the root of the complainant's case and creates strong doubtful circumstance regarding alleged loan transaction as observed by Hon'ble Apex Court in above said judgment of 18 C.C.No.23828/2018 Vijay V/s. Laxman's case and K. Subramani V/s. K. Damodhara Naidu's case reported in (2015)1 SCC 99.
29. It is important to note, in order to show the alleged liability of accused, the complainant mainly relied upon Ex.P-11 which is nomenclatured as acknowledgement of debt, which is said to have been executed by accused on 20.02.2018 by acknowledging the debt to an extent of Rs.19,00,000/-, thereafter accused issued present cheques on 08.06.2018 etc.
30. On the other hand, the accused has seriously disputed the execution of said Ex.P-11 on the alleged date of 20.02.2018 and he specifically contended that complainant along with some goondas visited to accused's house and assaulted as well as threatened him and obtained his three signed blank cheques and also forced him to sign on blank stamp paper i.e., present Ex.P-11 and subsequently created the same for the convenience of the complainant. So, immediately on 15.06.2018, he lodged compliant against the complainant as per Ex.D-2 and Ex.D-3 to that effect before Banasawadi Police. 19 C.C.No.23828/2018
31. Having regard to the rival contentions of the parties, a crucial question arises as to whether whose version is more probable and acceptable.
32. It is important to note, on perusal of Ex.P-11 which is styled as Acknowledgement of Debt, which is said to have been executed by the accused on 20.02.2018 on document sheet purchased from The Bangalore Advocate's Co-operative Society Ltd., under series No.ZÀ-U/4 . But it is important to note, on perusal of Ex.D-1, which is letter issued by very Bengaluru Advocate's Co-operative Society, clearly reveals that said document sheet series No.ZÀ-U/4 had been purchased by said Bangalore Advocate's Co- operative Society Ltd., on 03.05.2018 from its printer, thereafter in the subsequent dates, the said Bangalore Advocate's Co-operative Society Ltd., sold the document sheet. So, under such circumstances, when Bangalore Advocate's Co-operative Society Ltd., itself had purchased the document sheet on 03.05.2018, then the contention of the complainant that accused has executed acknowledgement of debt on above said document sheet on 20.02.2018 is highly improbable. So, it cannot be believable and acceptable.
20 C.C.No.23828/2018
33. At this juncture, it is also worth to note, learned counsel for accused has filed application U/s.340 of Cr.P.C., seeking for taking cognizance against the complainant for the offence punishable U/s.193 of IPC by alleging that complainant has committed offence of perjury.
34. It is important to note, as I have already pointed out, proceedings U/s.138 of NI Act is summary trial as prescribed U/s.261 to 265 of Cr.P.C. So, under such circumstances, I am of the opinion, entertaining the application U/s.340 of Cr.P.C., is not the scope under the summary proceedings. Hence, I am of the opinion, it is not necessary to conduct any enquiry regarding offence referred U/s.193 of IPC.
35. On considering the entire material on record and circumstances of the case, I am of the clear opinion that accused has successfully rebutted the mandatory presumption, whereas complainant has failed to discharge reverse onus shifted on him. So, under such circumstances, "The proceedings filed under Section 138 cannot be used as an arm twisting tactics to 21 C.C.No.23828/2018 recover the amount allegedly due from the appellant/accused"
As held by Hon'ble Apex Court in the judgment reported in (2013)8 SCC 71 (Mrs. Aparna A. Shah V/s. M/s. Sheth Developers Pvt. Ltd., and another).
36. So, as I have already discussed above, when complainant himself has failed to prove his version thereby accused has rebutted the presumption based on very material produced by the complainant himself, then I am of the opinion, it is not necessary to discuss much upon version of the accused. Hence, I hold this point in the Negative.
37. Point No.2: In view of discussion made on point No.1, this point does not survive for consideration. Hence, I hold this point accordingly.
38. Point No.3: For the foregoing reasons discussed on points No.1 and 2, I proceed to pass the following:-
ORDER Acting under Section 255(1) r/w Section 264 of Cr.P.C. the accused is hereby acquitted for the offence punishable u/S.138 of Negotiable Instruments Act.
The bail bonds of the accused and surety bonds stands cancelled.
22 C.C.No.23828/2018However, accused shall execute personal bond of Rs.19,00,000/- in view of Sec.437(A) of Cr.P.C.
(Directly dictated to Stenographer on computer, computerized by him, corrected and then pronounced by me in the open court on this the 10th day of January, 2020) (V. NAGARAJA) XXI ADDL. C.M.M., BENGALURU.
ANNEXURE LIST OF WITNESSES EXAMINED FOR THE COMPLAINANT:
PW-1 : Naresh Kumar LIST OF DOCUMENTS MARKED FOR THE COMPLAINANT:
Ex.P-1 & 2 : Cheques
Ex.P-3 & 4 : Bank Endorsements
Ex.P-5 : Copy of Legal Notice
Ex.P-6 : Postal Receipts
Ex.P-7 to 9 : Postal Acknowledgement Cards
Ex.P-10 : Reply
Ex.P-11 : Acknowledgement of Debt
Ex.P-12 : Statement of Accounts
Ex.P-13 : IT Returns Verification Form
LIST OF WITNESSES EXAMINED FOR THE DEFENCE:
DW-1 : Sathish Kumar Kannan LIST OF DOCUMENTS MARKED FOR THE DEFENCE:
Ex.D-1 : Letter issued by Advocate's
Co-operative Society, Bengaluru
Ex.D-2 : C.C. of Complaint
Ex.D-3 : C.C. of NCR
Ex.D-4 : C.C. of Statement of Mr. Indresh
Ex.D-5 : Bank Account Statements
(V. NAGARAJA)
XXI ADDL. C.M.M., BENGALURU.