Bangalore District Court
M/S.Do-All Engineering Industries vs M/S.Sarita Food Product Pvt.Ltd on 21 November, 2022
C.C.NO.15116/2018
0
KABC030412422018
Presented on : 05-06-2018
Registered on : 05-06-2018
Decided on : 21-11-2022
Duration : 4 years, 5 months, 16 days
IN THE COURT OF THE XXVIII ADDL. CHIEF
METROPOLITAN MAGISTRATE NRUPATHUNGA ROAD,
BENGALURU CITY
Present:
Soubhagya.B.Bhusher,
BA.,LLB.,LL.M
XXVIII A.C.M.M, Bengaluru City.
DATED: THIS THE 21 st DAY OF NOVEMBER-2022
C.C.NO.15116/2018
Complainant: M/s.Do-All Engineering Industries,
No.87/12, Industrial Subrub,
Yashwanthpur, Bangalore-560022.
Rep by its Partner,
Mr. B.N.Raghuram,
S/o Late.B.N. Ravichandra
Aged about 43 years.
(By Sri.M.V.Murthy.,Adv.,)
V/s
Accused: M/s.Sarita Food Product Pvt.Ltd.,
Factory: Ambarle, Post Panhalghar,
Taluq, Mangaon District,
Raigad-402103.
Rep by its Managing Director,
Mr.Arvind Ubhare,
And also at office:Shop No.60,
Aditya Shagun Mail, N.D.A, Pashan
Road, Bavdhan, Pune-411021.
(By Sri.Mahesh.S.Hiremath.,Adv.,)
C.C.NO.15116/2018
1
: JUDGMENT:
This case arises out of the complaint filed under section 200 of Cr.P.C., for the offence punishable under section 138 of N.I. Act.
2. The case of the complainant's in brief is as under:
It is submitted by the complainant is that, the complainant company is a Partnership Firm and doing business by carrying on manufacturing of soap, wrapping machine, fruit, vegetable, nut processing, bottle washing machines, sorting grading equipments and stainless steel fabrication of industrial equipment. Further the accused is registered company under the Company's Registration Act and the managing director of the accused company is the authorized signatory. It is further stated that, the accused have placed purchase order No.SFPPL/004, dated: 07.07.2016 and SFPPL/005, dated: 07.07.2017 on quotation No.2016/DAEI/05/049 dated: 31.05.2016 and quotation No.2016/DAEI/05/050 dated: 31.05.2016 with the complainant. Further the complainant has deposited a sum of Rs.20,33,566/- (Rupees twenty lakhs thirty C.C.NO.15116/2018 2 three thousand five hundred sixty six) only as EMD (Earnest Money Deposit) as per the terms of the said project as follows:
SI.No. Date Mode of Amount
Payment
1 16th Jan 2016 By DD Rs.4,00,000/-
2 3rd June 2016 RTGS Rs.4,00,000/-
3 3rd June 2016 RTGS Rs.8,33,566/-
4 2nd August 2016 RTGS Rs.4,00,000/-
On the request of the accused for financial help to conduct October program the complainant has transferred a sum of Rs.1,00,000/- by RTGS on 19 th October 2016. It is further stated that the accused has not at all proceed with project on one or other pretext and also failed comply the terms and conditions of the purchase orders placed by them. It is further stated that after repeated several requests of the complainant the accused has issued a cheque bearing No.405442 dated: 27.11.2017 for a sum of Rs.21,33,566/- towards the discharge of legally recoverable debt drawn on the State Bank of India, Plot No.33-34, Amchi Colony, NDA Road, Pune-411021 in favour of the complainant.
3. It is further submitted that, as per request of the C.C.NO.15116/2018 3 accused, the complainant has presented the said cheque for encashment on 27.11.2017 through its banker i.e., the Canara Bank, Malleswaram branch, Bangalore, the said cheque was dishonored and returned to them with a shara as "Funds Insufficient" in the account of the accused, vide memo dated:
28.11.2017. It is further stated that, the complainant has informed about the dishonor of the aforesaid cheque to the accused, at that time the accused has apologized and requested to re-present the said cheque on 05.12.2017, as per the request of the accused, the complainant has re-presented the same, the same also dishonored with same reason. Even repeated information and request made by the complainant, the accused has finally requested the complainant to re-present the same once again on 08.02.2018 and assured that the aforesaid cheque would be honored without fail. As per repeated request of the accused, the complainant has re-presented the said cheque for encashment on 08.02.2018 through its banker i.e., the Canara Bank, Malleshwara branch, C.C.NO.15116/2018 4 Bangalore, the said cheque was dishonored and returned to them with a shara as "Funds Insufficient" in the account of the accused vide memo dated:
09.02.2018. After receiving the dishonored cheque the complainant tried to contact the accused but there was no response from the side of the accused, having on other alternative the complainant got issued a legal notice dated: 18.02.2018 through its advocate calling upon the accused to make payment of the said amount due under the dishonored cheque. The said notice was dispatched to the accused through the RPAD to their working place as stated in this case. The notice sent under the RPAD to the accused was duly served on 21.02.2018. Further, inpsite of receipt the said notice the accused has failed to repay the amount covered under the said dishonored cheque, which is legally recoverable debt. It is further stated that the accused has not made any payment so far. The accused failed to repay the cheque amount and he has failed to reply the notice. As such, the accused has committed an offence punishable under section 138 of N.I.Act.
C.C.NO.15116/2018 5 Hence, the present complaint came to be filed before this court on 15.03.2018.
4. After the complaint was filed, the cognizance of the offence cited therein was taken and it was registered as P.C.R.No.6002/2018. Sworn statement of the complainant was recorded. Since there were sufficient materials to proceed against the accused, an order was passed on 01.06.2018 to register the case in Reg.No.III.
5. Thereafter, summons was issued to the accused and he has appeared before the court through counsel and secured bail. He was furnished it necessary papers as complied under section 208 of Cr.P.C,. Thereafter, the plea of the accused was recorded by the court. He has pleaded not guilty and claimed to be tried.
6. The complainant in support of its case, has examined its Partner as PW.1 and got marked total 21 documents at Ex.P.1 to 21 and closed its side.
7. After closer of the evidence of the complainant, C.C.NO.15116/2018 6 the statement under section 313 of Cr.P.C. was recorded. He has denied the incriminating evidence appearing against him. In his defense the accused has not lead any evidence and no documents were marked on his behalf.
8. I have heard the arguments on both the sides and perused the written argument filed by the leaned counsel for the accused and also perused the material placed on record.
9. Learned counsel for the accused has relied on the citations reported in 2008(1) DCR 374 Supreme Court of India (Para No.20), 2009 (1) DCR 165 Kar.H.C, 1998 Cr.L.J 419 Andhra Pradesh High Court, ILR 2007 KAR 3155, ILR 2008 KAR 4629, 2008(2) DCR 462 Madras High Court, 2009(2) SCC 513 (A), AIR 2008 S.C 1325 (A), (B), 2017 (2) DCR 509 Kerala High Court, 2019 (2) DCR 387 Bombay High Court, 2018 (1) DCR 671 Rajasthana High Court and 2018 (1) DCR 331 Bombay High Court.
10. Upon hearing the arguments and on perusal C.C.NO.15116/2018 7 of the material placed on record, the following points arise for my consideration:
1.Whether the complainant proves the existence of legally enforceable debt/liability.?
2. Whether the complainant further proves that the accused had issued a cheque-Ex.P.2, towards the discharge of the said legally enforceable debt/ liability.?
3.Whether the complainant further proves that, Ex.P.2 was dishonored for the reasons "Funds Insufficient" in the account of the accused and thereafter the accused had failed to repay the same within the statutory period, inspite of receipt of legal notice.?
4. Whether the accused has thus committed an offence punishable under section 138 of N.I.Act.?
5. What order or sentence?
11. My answers to the above points are as under:
Point No.1: In the Affirmative Point No.2: In the Affirmative Point No.3: In the Affirmative Point No.4: In the Affirmative Point No.5: As per final order, for the following:
:REASONS:
12. POINT NO.1 AND 2: These two points are C.C.NO.15116/2018 8 inter-related to each other and finding given on any one point will bearing on the another. Hence, in order to avoid repetition of facts, I have taken these points together for common discussion. The case of the complainant is that, he was acquainted with the accused. Further the complainant company is a partnership firm and doing business by carrying on manufacturing of soap, wrapping machine, fruit, vegetable, nut processing, bottle washing machines, sorting grading equipments and stainless steel fabrication of industrial equipment. Further, the accused is registered company under the company's Registration Act and the managing director of the accused company is the authorized signatory. It is further stated that, the accused have placed purchase order No.SFPPL/004, dated 07.07.2016 and SFPPL/005, dated 07.07.2017 on quotation No.2016/DAEI/05/049 dated 31.05.2016 and quotation No.2016/DAEI/05/050 dated 31.05.2016 with the complainant and further the complainant has deposited a sum of Rs.20,33,566/- (Rupees twenty lakhs thirty C.C.NO.15116/2018 9 three thousand five hundred sixty six) only as EMD (Earnest Money Deposit) as per the terms of the said project and on the request of the accused for financial help to conduct October program the complainant has transferred a sum of Rs.1,00,000/- by RTGS on 19 th October 2016. It is further stated that, the accused has not at all proceed with project on one or other pretext and also failed comply the terms and conditions of the purchase orders placed by them. After repeated several requests of the complainant the accused has issued a cheque bearing No.405442 dated: 27.11.2017 for a sum of Rs.21,33,566/- towards the discharge of legally recoverable debt, drawn on the State Bank of India, Plot No.33-34, Amchi Colony, NDA Road, Pune-411021 in favour of the complainant.
13. As per request of the accused, the complainant has presented the said cheque for encashment on 27.11.2017 through its banker i.e., the Canara Bank, Malleswaram branch, Bangalore, the said cheque was dishonored and returned to them with a shara as "Funds Insufficient" in the account of the C.C.NO.15116/2018 10 accused, vide memo dated: 28.11.2017. The complainant has informed about the dishonor of the aforesaid cheque to the accused, at that time the accused has apologized and requested to re-present the said cheque on 05.12.2017, as per request of the accused, the complainant has re-presented the same, the same also dishonored with same reason. Even repeated information and request made by the complainant, the accused has finally requested the complainant to re-present the same once again on 08.02.2018 and assured that the aforesaid cheque would be honored without fail. As per repeated request of the accused, the complainant has re-presented the said cheque for encashment on 08.02.2018 through its banker i.e., the Canara Bank, Malleshwara branch, Bangalore, the said cheque was dishonored and returned to them with a shara as "Funds Insufficient"
vide memo dated: 09.02.2018. After receiving the dishonored cheque the complainant tried to contact the accused, but there was no response from the side of the accused. Hence, the complainant got issued a legal C.C.NO.15116/2018 11 notice dated: 18.02.2018 through its advocate calling upon the accused to make payment of the said amount due under the dishonored cheque. The said notice was dispatched to the accused through the RPAD to their working place as stated in this case. The notice sent under the RPAD to the accused was duly served on 21.02.2018. Further, inpsite of receipt the said notice the accused has failed to repay the amount and he has failed reply the notice. As such the accused has committed an offence punishable under section 138 of N.I.Act, the present complaint came to be filed.
14. In support of the case, the complainant has examined its Partner as P.W.1 and 21 documents were marked at Ex.P.1 to 21. In the chief examination P.W.1 has repeated the contents taken by the complainant in the complaint. Ex.P.1 is the Partnership Deed. Ex.P.2 is the cheque issued by the accused in favour of the complainant on 27.11.2017 for a sum of Rs.21,33,556/-. Ex.P.2(a) is the signature of the accused. Ex.P.3 and 4 are the bank memos informing of the dishonor of the cheque on 28.11.2017 and C.C.NO.15116/2018 12
09.02.2018 repectively. Ex.P.5 is the office copy of legal notice. Ex.P.5(a) and Ex.P.5(b) are the postal receipts. Ex.P.6 is the returned postal cover. Ex.P.6(a) is the returned legal notice. Ex.P.7 is the postal acknowledgment. Ex.P.8 is the Complaint. Ex.P.9 is the track consignment. Ex.P.10 is the Registration Acknowledgment of the complainant company. Ex.P.11 is the Partnership Deed of the complainant company in the year 1974. Ex.P.12 is the Authorization. Ex.P.13 is the Tender No.1 and tender notice issued by the accused company on 05.12.2015. Ex.P.14 is the certified copy of Tender No.2 and tender notice issued by the accused company on 05.12.2015. Ex.P.15 is the quotation dated: 16.01.2016 given by the complainant company to the accused company. Ex.P.16 is the courier receipt for sending quotation and D.D amounting of Rs.4 lakhs to the accused company. Ex.P.17 & 18 are the purchase orders dated 07.07.2016 issued to the accused company. Ex.P.19 is the Online copy of account statement of the complainant company. Ex.P.20 is the certificate under C.C.NO.15116/2018 13 section 65(B) of the Indian Evidence Act. Ex.P.21 is the Xerox copy of the e-mail conversation between the complainant and the accused company. Ex.P.10 to 21 documents are marked subject to objection by the counsel for the accused.
15. But, the accused has taken the contention that, the complainant company had taken a blank cheque at the time of depositing of EMD amount for the purpose of security. Further the complainant has misused the said blank cheque and filed this false complaint against the accused. The accused in his defense has not disputed at Ex.P.2-cheque has been issued by him. He also does not dispute his signature appearing on the said cheque. But, he has taken up the contention that, he has issued a blank signed cheque in favour of the complainant at the time of depositing EMD amount for the purpose of security, when the cheque was given to the complainant it was blank. But the complainant misused the said cheque. Further he contended that he has never admitted regarding repayment of the amount as contended by the C.C.NO.15116/2018 14 complainant.
16. In order to attract the offence punishable under section 138 of N.I.Act, the complainant is firstly required to prove the existence of legally enforceable debt/liability, for which the cheque came to be issued. The learned counsel for the complainant has argued that, from the evidence placed on record, the fact that the accused in order to repayment of debt/liability had issued a cheque in favour of the complainant. Further argued that, after the repeated request made by the complainant, the accused has not paid any amount to the complainant. He further argued that the accused has not denied the cheque-Ex.P.2 being drawn on his account. When the signature is not disputed, the presumption under section 139 N.I.Act is to be drawn in favour of the complainant. The accused has failed to elicit anything in the cross examination of P.W.1 to disbelieve the said evidence of the complainant case. The defence has failed to rebut the presumption under section 139 N.I.Act. The counsel for the complainant further argued that the accused has failed to produce C.C.NO.15116/2018 15 any believable evidence that, the accused had issued a blank cheque in favour of the complainant for the purpose of EMD security and also the defence how the cheque was got the complainant and why he has not returned back the same is not clear. He further argued that, under section 139 of N.I.Act, there is a presumption that, the cheque has been issued for discharge of legally enforceable debt/liability. In the present case, the accused has not disputed the cheque-Ex.P.2 being his cheque drawn on his account. The said presumption is available to the complainant. Further he has argued that the accused has failed to prove the very fact that at Ex.P.2 was given to the complainant for the purpose of security of EMD depositing amount and it was blank when it was given to the complainant. Moreover, under section 118 of N.I.Act, there is a presumption that the Negotiable Instrument is drawn on the date, for the amount and in favour of the person as shown in it. It is for the accused to rebut the said presumption. But, in the case on hand no such evidence forthcoming. It was also argued by C.C.NO.15116/2018 16 him that as per the defence by the accused that he had given a blank signed cheque to the complainant. As such, very defence of the accused is not believable.
17. The main defence of the accused is that, there was no legally enforceable debt/liability to the complainant from the accused for which the cheque- Ex.P.2 was issued. So also he has taken up the defence that he had issued a blank signed cheque to the complainant at the time of depositing of EMD amount for the purpose of security. In order to attract the offence punishable under section 138 of N.I.Act, the complainant is firstly required to prove the existence of a legally enforceable debt/liability, for which the cheque came to be issued. The complainant created all the documents and filed this false complaint against the accused. Therefore, from the evidence placed on record, the very repayment of amount to the complainant is not clearly made out whereas the accused is succeeded in rebutting the presumption available under section 139 of N.I.Act regarding existence of legally enforceable debt.
C.C.NO.15116/2018 17
18. In the case on hand the complainant and the accused having some transaction has not been seriously disputed by the accused. Further, the accused has not seriously disputed he has issued a cheque in favour of the complainant. It is not disputed that the complainant is the private company and the accused is Managing Director of the accused company. He had issued a cheque-Ex.P.2. Whereas, the accused has contended that he had given a blank signed chaque to the complainant at the time of depositing of EMD amount for the purpose of security. When he had given a signed cheque, which was blank. The accused has specifically denied having debt/liability and issued a cheque-Ex.P.2 in the year 2017 towards the discharge of any debt/liability. He contends that the blank cheque given by him to the complainant for the purpose of security as was misused by the complainant and a false complaint was filed.
19. In order to attract the offence of the section 138 of N.I.Act, the main ingredients of the existence of the legally enforceable debt/liability, for which the C.C.NO.15116/2018 18 cheque drawn on the account of the accused was given for discharge of the same, are to be proved. The complainant in order to prove its case, has examined its Partner as PW.1 and 21 documents were marked at Ex.P.1 to 21. In chief examination, he has repeated the averments made by him in the complaint. In the present case, the accused has not disputed the cheque-Ex.P.2 being his cheque drawn on his account. The said presumption is available to the complainant.
20. As per the section 139 of N.I.Act, there is a presumption regarding the existence of legally enforceable debt or liability. Such presumption is rebuttable presumption and it is opinion to the accused to raise defence discharging the existence of a legally enforcible debt/liability. In the case on hand also the accused has disputed the existence of legally enforceable debt/liability, for which Ex.P.2 was issued. In order to prove his defense, the accused has not examined and not produced any documentary evidence. PW.1 during his cross-examination has specifically denied the suggestions made to him that C.C.NO.15116/2018 19 Ex.P.2 was issued in favour of the complainant company for the purpose of security at the time of depositing of EMD amount and same was blank at the time of issuing the same.
21. Since, the presumption under section 139 of N.I.Act is a rebuttable presumption the accused is firstly required to produce some probable evidence to rebut the same. Though in the criminal cases, the standard of the proof required for the accused is not so strict as required for the complainant to prove the case. Further he has to produce some probable evidence, which creates doubt about the existence of legally enforceable debt/liability. In the present case, as per the defence taken by the accused is that, he had given a blank signed cheque to the complainant for the purpose of security. Except, said defence, he has not produced any materials to prove such defence. If he had given a blank signed cheque to the complainant, what prevented the accused to file the complaint immediately after the alleged illegal act made by the complainant. Further what prevented the accused to file C.C.NO.15116/2018 20 the complaint against the complainant for misusing of said cheque. On which date the accused came to knew about the alleged illegal act of the complainant, he did not whisper about on what date he came to know the alleged cheque illegally misused by the complainant. Admittedly the accused is a Managing Director of the accused company, businessman and having knowledge of the financial transaction, why he has given a blank signed cheque to the complainant without anticipating the consequence is not explained by him. So also, he has not stated anything as to what steps he took to receive back the blank signed cheque. Moreover, immediately after the alleged blank cheque misused by the complainant he has not lodge complaint before concerned police station. No steps have been taken to receive back a blank signed cheque, after he came to know about the same.
22. Once issuance of cheque and signature are admitted, the statutory presumptions would arise under sections 139 and 118 of the N.I.Act that cheque was issued by the drawer for legally payable debt/liability C.C.NO.15116/2018 21 and for valid consideration. The Hon'ble Supreme Court has held in Rangappa V/S Mohan (2010 AIR SCW
296), the presumption that the cheque was drawn in discharge of legally recoverable debt is a presumption of law that ought to be raised in every case, though, it is a rebuttable presumption. Ofcourse, the presumption under section 139 and 118 of the N.I.Act are rebuttal presumption. Further it is also held that mere plausible explanation by the drawer is not sufficient and proof of that explanation is necessary. The principle of law laiddown in the above decision is applicable to the facts of this case. In the instant case, since the complainant is in possession of a cheque-Ex.P.2 the court has to draw the initial presumption that, he is the payee of that cheque. Once the initial burden is discharged by the complainant, the onus shifts on the accused to rebut the complainant's case.
23. In the defence there is no ill-will between the complainant and the accused. Hence, misuse of cheque and filing false case is not possible. The accused admittedly having knowledge of business. It is C.C.NO.15116/2018 22 implies, he is conversant with financial transaction. If the complainant misused the said cheque and had not return the same, inspite of collecting cheque leaves from him, as a prudent man, the accused should have inquired with the complainant and demanded to return that cheque. No ordinary prudent man would keep quite in such circumstances, without taking any steps. The conduct of the accused is very unusual, because he did not take any legal action against the complainant, even after filing of the complaint based on Ex.P.2-cheque. Further he could have issued notice to his banker to stop payment or legal notice to the complainant or he could have given complaint to the police station immediately. No such steps were taken by the accused. He simply makes a bald allegation of misuse of a blank signed cheque against the complainant. It appears, just to escape from his legal liability, he has taken such contentions without any valid basis.
24. Moreover, the complainant has got issued a legal notice to the accused by registered through its counsel calling upon the accused to make repayment C.C.NO.15116/2018 23 of said amount to the complainant. Before a person is held to be guilty of the offence punishable under section 138 of N.I.Act, the complainant has to prove the compliance of the requirement under section 138 of N.I.Act. It is not in dispute that the Ex.P.2 is the cheque drawn on account of the accused. In view of the above discussions it is also held to be proved that it was drawn for discharge of legally enforceable debt/liability. From the evidence of P.W.1 and also cheque return memos Ex.P.3 and 4 it is established that the cheque was dishonored for the reason "Funds Insufficient'' in the account of the accused. A notice being issued as per Ex.P.5 within one month from the date of dishonour is also not in dispute. In the case on hand the accused has not seriously disputed regarding notice send by the complainant on his address. The accused failed to reply the notice, immediately after he received the demand notice. Thereby, he could has asserted his defence at an earliest available opportunity. In the case on hand the notice is sent to the accused at his address. When the accused has not disputed, the C.C.NO.15116/2018 24 notice sent to the correct address is sufficient compliance under section 138 of N.I.Act. Therefore, there is sufficient proof of due service of the legal notice.
25. It is not the contention of the accused that thereafter he has repaid the cheque amount within stipulated time of 15 days on receiving the notice. Therefore, in the case on hand on perusal of the evidence placed on record, all the essential ingredients under section 138 N.I.Act, have been complied with. As the accused has not paid the cheque amount within stipulated period and failed to give reply to the notice, as such the accused has committed an offence punishable under section 138 of Negotiable Instruments Act. The present complaint is filed within the period of one month after the accused failed to repay the cheque amount. Further the accused has not given any reply to the notice and he has failed to repay the amount. Even he did not whisper anything about the defence while his plea was recorded under section 251 of Cr.P.C. In view of C.C.NO.15116/2018 25 judgment of Hon'ble Supreme Court in Indian Bank Association V/s Union of India and others, (2010 (5) SCC 590), it is clear that while recording the plea under section 251 of Cr.P.C., it becomes the duty of the accused to state whether he has any defence to make or he pleads guilty. Thus, unlike under section 240 of Cr.P.C., the accused has no option under section 251 of Cr.P.C., just to deny the allegations made against him. If he is not willing to plead guilty, he must explain what are the defences he want to take. As such it has to be considered, whatever defence raised by the accused during the trial are all after thought, just to get ride of statutory burden cast on him.
26. In addition to this in the case of T.P.Murugan (Dead) through legal representatives V/s Bojan (2018 (8) SCC 469), the Hon'ble Apex Court held that once the cheque has been signed and issued in favour of the holder of the cheque, there is statutory presumption that, the cheque is issued in respect of legally enforceable debt or liability: rebuttal of such C.C.NO.15116/2018 26 presumption must be by adducing credible evidence. Mere raising a doubt without cogent evidence with respect to the circumstances, presumption under section 139 of N.I.Act cannot be discharged. The principle of law laid down in the above decisions are applicable to the facts of this case. Except some bald contentions, the accused has not been able to make out a probable case on his behalf.
27. The accused has taken defence that, except signature other writings on Ex.P.2-cheque is not in his handwriting, which were filled up by the complainant and it amounts to material alterations, so, the complaint is liable to be dismissed. As narrated above, the complainant has specifically asserted that accused after putting his signature on Ex.P.2 to filled up other contents and then handed over it to them. When the accused admits his signature, he cannot take up a defence that other contents of cheque were filled up by the complainant and it amounts to material alteration. In this respect, ruling reported in 2019 SCC On-line (SC)
138), between Bir Singh V/s Mukesh Kumar, the C.C.NO.15116/2018 27 Hon'ble Apex Court held as under:
"37. A meaningful reading of the provisions of the Negotiable Instruments Act including, in particular, Sections 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer, if cheque is otherwise valid, the penal provision of Section 138 would be attracted.
38. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still the on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence.
40. Even a blank cheque leaf, voluntarily signed and handed over by the accused which is towards some payment. Would attract presumption Under section 139 of the Negotiable Instruments Act, in the C.C.NO.15116/2018 28 absence of any cogent evidence to show that the cheque was not issued in discharge of a debt."
28. The principles emerging from the above referred decision make it clear that, it is not mandatory and no law prescribes that the contents of cheque should be written by the signatory to the cheque. A cheque can be written by anybody and if the account holder of the cheque signs it, the presumption under section 139 of N.I.Act arises. The principle of law laid- down in above decision is aptly applicable to the facts of this case. In view of section 20 of N.I.Act, cheque being an inchoate instrument, if the drawer signs and delivers to the drawee, thereby he gives authority to the drawee thereof to make or complete the instrument.
29. The Hon'ble Apex Court in K.Bhaskaran V/s Sankaran Vaidhyan Balan and another (1999 Cri. L.J.4608) held that if the accused denies issue of cheque although owned his signature therein, the presumption arises that cheque was made or drawn for consideration on the date mentioned in cheque.
C.C.NO.15116/2018 29 The holder of cheque presumed to have received it for discharge of liability of the drawer.
30. As per the version of the accused is that, he has nowhere denied transaction. The accused himself has admitted that, he is the holder of alleged cheque. It is sufficient hold that the accused has issued a cheque-Ex.P.2 and even after the accused has not repaid the cheque amount the getting of receipt of notice. However, in any manner as the complainant has complied all the terms of ingredients of the provisions of 138 of N.I.Act. The accused is liable for dishonor of cheque. As per the ruling reported in 2015 (2), Bankman 415, "Section 138 and 139 of N.I.Act. 1881. In case of dishonor of cheque, once the execution of cheque is admitted by the accused, then it for him to first rebut presumption arising out of section 139 of N.I.Act. "As per section 27 of General Clause Act 1897, presumption is in favour of complainant that, statutory notice is duly served on the accused". Hence, notice presumed to be served on the accused. Therefore, defence also holds no water.
C.C.NO.15116/2018 30 Accordingly, PW.1 has established his case the accused has issued a cheque-Ex.P.2 in order to repay the legally recoverable amount. Therefore, the accused has failed to probables the defence taken by him that, the cheque-Ex.P.2 was a blank signed cheque and given to the complainant for the purpose of security at the time of depositing the EMD amount. Therefore, the accused has failed to rebut the presumption under section 139 of N.I.Act. In the said circumstances, the complainant is not at all required to produce any material as to the financial transaction between the complainant and the accused, since the initial presumption is still available, when there is no rebuttal evidence.
31. PW.1 in his evidence has specifically stated that the accused in order to repayment of amount he had issued a cheque-Ex.P.2. So also it is not in disputed that the complainant and the accused are known to each other, some point of period, no documents could have been existence the evidencing financial transaction. This factor will not affect case of C.C.NO.15116/2018 31 the complainant to disbelieve the financial transaction. When the accused has failed to rebut the presumption under section 139 of N.I.Act, non furnishing of details of financial transaction no consequences to disbelieve the case of the complainant. The accused has failed to probables his defense. When the accused has failed to rebut the presumption under section 139 of N.I.Act, non furnishing of details of financial transaction no consequences to disbelieve the case of the complainant. Further the accused has failed to probables his defence. With these reasons, I answer point No.1 and 2 in the Affirmative.
32.POINT NO.3 AND 4: In order to avoid repetition of facts, these two points are taken together for common discussion. Before a person is held to have committed an offence punishable under section 138 of N.I.Act, he has to prove all the requirements of section 138 of N.I.Act. The cheque-Ex.P.2 being drawn on the account of the accused is not in dispute. The said cheque having been dishonored, when it was presented by the complainant before the Bank for C.C.NO.15116/2018 32 encashment is also not seriously disputed by the accused. The accused has not taken up any contention that thereafter he had paid the cheque amount within stipulated time of 15 days, after given of the notice. As such in the present case from perusal of documents, the essential requirements of section 138 of N.I.Act, have been complied with. In this case if he has issued a blank signed cheque in favour of the complainant for the purpose of security at the time of depositing of EMD amount and why he has not produced any documents. After service of notice the accused has not paid the said amount and failed to give reply to the said notice. Hence, the present complaint came to be filed before the court on 15.03.2018 within the period of one month from the date of cause of action.
33. While discussing the point No.1 and 2, this court has already observed that the complainant has proved that the cheque-Ex.P.2 was issued for discharge of legally enforceable liability/debt and in view of the mandatory requirements under section 138 C.C.NO.15116/2018 33 of N.I.Act, being complied with. The accused is found to have committed an offence punishable under section 138 of N.I.Act. With these reasons, I answer point No.3 and 4 in the Affirmative.
34. POINT NO.5: The accused is held to have committed an offence punishable under section 138 of N.I.Act. The complainant has proved its case. The accused has failed to prove his rebuttal for the reasons mentioned above and in view of the mandatory requirements of section 138 of N.I.Act, being complied with. The accused is found to have committed an offence punishable under section 138 of N.I.Act. Since, the said offence is an economic crime, the accused is not entitled for the beneficial provisions of probation of offenders Act. In view of the above discussions and the findings on point No.1 to 4, I proceed to pass the following;
:ORDER:
Acting under section 255(2) of Cr.P.C. the accused is convicted for the offence punishable under section 138 of N.I.Act.
The bail bond of the accused is stands C.C.NO.15116/2018 34 canceled.
The accused is sentence to pay Rs.21,38,566/- (Rupees twenty one lakhs thirty eight thousand five hundred sixty six) only to the complainant.
It is further ordered that out of the said fine amount an amount of Rs.21,33,566/- (Rupees twenty one lakhs thirty three thousand five sundred sixty six) only shall be paid to the complainant as compensation as per Section 357(1)(b) of Cr.P.C. and remaining amount of Rs.5,000/- (Rupees five thousand) only shall be remitted to the State.
In default of the payment of fine amount, the accused shall undergo simple imprisonment of one year.
(Dictated to the stenographer directly on computer typed by her, corrected by me and then judgment pronounced in the open court on 21 st day of November 2022) (Soubhagya.B.Bhusher) XXVIII Addl. Chief Metropolitan Magistrate, Bengaluru.
ANNEXURE List of witness examined on behalf of the complainant:
PW.1 : Mr.B.N.Raghuram List of documents marked on behalf of the complainant:
C.C.NO.15116/2018 35 Ex.P.1 : Partnership deed.
Ex.P.2 : Cheque.
Ex.P.2(a) : Signature of the accused.
Ex.P.3 & 4 : Bank endorsements on 28.11.2017 & 09.02.2018.
Ex.P.5 : Office copy of legal notice.
Ex.P.5(a) & (b) : Postal receipts.
Ex.P.6 : Returned postal cover.
Ex.P.6(a) : Returned legal notice.
Ex.P.7 : Postal acknowledgment.
Ex.P.8 : Complaint.
Ex.P.9 : Track consignment.
Ex.P.10 : Registration acknowledgment of the complainant
company.
Ex.P.11 : Partnership deed of the complainant company.
Ex.P.12 : Authorization.
Ex.P.13 : Tender No.1 and tender notice issued by the
accused company on 05.12.2015.
Ex.P.14 : Certified copy of tender No.2 and tender notice
issued by the accused company on 05.12.2015 Ex.P.15 : Quotation dated: 16.01.2016 given by the complainant company to the accused company. Ex.P.16 : Courier receipt for sending quotation and DD amounting of Rs.4 Lakhs to the accused company. Ex.P.17 & 18 : Purchase orders dated:07.07.2016 issued to the accused company.
Ex.P.19 : Online copy of account statement of the complainant company.
Ex.P.20 : Certificate U/s.65(b) of the Indian Evidence Act. Ex.P.21 : Xerox copy of the e-mail conversation between the complainant and accused company. (Ex.P10 to 21 marked subject to objection by the counsel for the accused.) List of witnesses examined on behalf of the accused:
- NIL-
List of documents marked on behalf of the accused:
- NIL -
XXVIII Addl. Chief Metropolitan Magistrate, Bengaluru.
C.C.NO.15116/2018 36 21.11.2022 (Judgment pronounced in the Open Court Vide Separate Sheet) :ORDER:
Acting under section 255(2) of Cr.P.C. the accused is convicted for the offence punishable under section 138 of N.I. Act.
The bail bond of the accused is stands canceled.
The accused is sentence to pay Rs.21,38,566/- (Rupees twenty one lakhs thirty eight thousand five hundred sixty six) only to the complainant.
It is further ordered that out of the said fine amount an amount of Rs.21,33,566/- (Rupees twenty one lakhs thirty three thousand five sundred sixty six) only shall be paid to the complainant as compensation as per Section 357(1)(b) of Cr.P.C. and remaining amount of Rs.5,000/- (Rupees five thousand) only shall be remitted to the State.
In default of the payment of fine amount, the accused shall undergo simple imprisonment of one year.
XXVIII Addl. Chief Metropolitan Magistrate, Bengaluru.