Bangalore District Court
Sri.M.Subramaniam vs M.Munivenkataiah on 4 December, 2018
IN THE COURT OF LVII ADDL. CHIEF METROPOLITAN
MAGISTRATE, MAYO HALL UNIT, BENGALURU
-: PRESENT :-
PADMA PRASAD, BA (Law), LLB.
LVII ADDL. CHIEF METROPOLITAN MAGISTRATE,
BENGALURU.
DATED THIS THE 4TH DAY OF DECEMBER, 2018.
C.C.No.56338/2017
COMPLAINANT : Sri.M.Subramaniam
S/o Muthandy,
Aged about 50 years
R/at No.D-5/8,
DRDO Township [Defense Research
Development Organization],
C.V.Raman Nagar,
Bangalore - 93.
.Vs.
ACCUSED : M.Munivenkataiah
Aged about 50 years,
Working at Hopcoms Shop No.99,
Krishna Temple Road,
Opp to Tumkur Grain Merchant Co-
Operative Bank,
Ist Stage, Indiranagar,
Bangalore - 38.
****
JUDGMENT
The complainant filed this complaint against the accused for the offence punishable under Section 138 of Negotiable Instruments Act.
2 C.C.No.56338/20172. The complaint case in nutshell is that the accused carrying the business of fruits and vegetables and supplying the same to hotels and restaurants. In the 1st week of October 2016 the accused approached the complainant for a loan of Rs.6,00,000/-. Accordingly in the 3rd week of October 2016 the complainant paid Rs.6,00,000/- to the accused. The accused agreed to repay the same in the month of January 2017 and issued a cheque bearing No.369031 dtd:02.01.2017 for Rs.5,50,000/- drawn at Tumkur Grain Merchants Co-Operative Bank, Indiranagar Branch, Bengaluru and another cheque bearing 284137 dtd:05.01.2017 for Rs.50,000/- drawn at SBM, Indiranagar Branch, Bengaluru. Accordingly the complainant presented the said cheque for encashment as on 17.03.2017. The 1st cheque dtd:02.01.2017 issued for Rs.5,50,000/- has been returned with bank memo dtd:18.03.2017 stating "Payment stopped by drawer". The another cheque bearing No.369031 dtd:05.01.2017 returned with bank endorsement dtd:18.03.2017 stating "In sufficient Funds". Thereafter the complainant caused legal notice to the accused dtd:15.04.2017 calling upon the accused to pay the cheque amount. The said notice duly served to the accused on 17.04.2017. The accused failed to comply with the notice. Hence, filed this complaint.
3. After filing the complaint, sworn statement of the complainant has been recorded and on perusing the materials on record i.e., cheque, bank endorsement, legal notice and documents for having 3 C.C.No.56338/2017 been caused the notice to the accused, the court has been taken the cognizance of offence and issued summons to the accused.
4. In response to the summons, the accused appeared through his counsel and he was on court bail. Plea has been recorded; accused pleaded not guilty and claimed to be tried.
5. To prove the case, the complainant got examined himself as P.W.1 and one witness as P.W.2 and got marked documents at Ex.P.1 to P.8.
6. The accused in support of his defense examined himself as D.W.1. The case made out by the accused is that he came to know the complainant through one Venkataswamy. The accused claimed that he has approached the Venkataswamy for a loan of Rs.2,00,000/- and said Venkataswamy arranged the loan of Rs.2,00,000/- from the complainant to the accused. The accused also claimed that the complainant paid Rs.2,00,000/- in installments of Rs.50,000/- each. The accused further claimed that he has repaid the said amount in installments for Rs.50,000/- each through Venkataswamy. The accused further claimed that the complainant brought rowdy elements to his office and forcibly taken the cheque from him. The accused disputed the service of notice and prayed for dismissal of complaint.
7. On closure of complainant side evidence, the accused statement has been recorded under Sec.313(1)(b) of Cr.P.C., by 4 C.C.No.56338/2017 placing the incriminating evidence appeared against the accused that are denied by the accused.
8. On the basis of above, the point for consideration is that;
"Whether the complainant has proved that the accused has committed the offence punishable under Sec.138 of Negotiable Instruments Act?"
9. Heard the arguments and perused the materials on record. On that basis my finding on the above point is in the "Affirmative" for the following;
REASONS
10. The complaint case in nutshell is that the accused carrying the business of fruits and vegetables and supplying the same to hotels and restaurants. In the 1st week of October 2016 the accused approached the complainant for a loan of Rs.6,00,000/-. Accordingly in the 3rd week of October 2016 the complainant paid Rs.6,00,000/- to the accused. The accused agreed to repay the same in the month of January 2017 and issued a cheque bearing No.369031 dtd:02.01.2017 for Rs.5,50,000/- drawn at Tumkur Grain Merchants Co-Operative Bank, Indiranagar Branch, Bengaluru and another cheque bearing 284137 dtd:05.01.2017 for Rs.50,000/- drawn at SBM, Indiranagar Branch, Bengaluru. Accordingly the complainant presented the said cheque for encashment as on 17.03.2017. The 1st cheque dtd:02.01.2017 issued for Rs.5,50,000/- has been returned with bank memo dtd:18.03.2017 stating "Payment stopped by 5 C.C.No.56338/2017 drawer". The another cheque bearing No.369031 dtd:05.01.2017 returned with bank endorsement dtd:18.03.2017 stating "In sufficient Funds". Thereafter the complainant caused legal notice to the accused dtd:15.04.2017 calling upon the accused to pay the cheque amount. The said notice duly served to the accused on 17.04.2017. The accused failed to comply with the notice. Hence, filed this complaint.
11. The accused in support of his defense examined himself as D.W.1. The case made out by the accused is that he came to know the complainant through one Venkataswamy. The accused claimed that he has approached the Venkataswamy for a loan of Rs.2,00,000/- and said Venkataswamy arranged the loan of Rs.2,00,000/- from the complainant to the accused. The accused also claimed that the complainant paid Rs.2,00,000/- in installments of Rs.50,000/- each. The accused further claimed that he has repaid the said amount in installments for Rs.50,000/- each through Venkataswamy. The accused further claimed that the complainant brought rowdy elements to his office and forcibly taken the cheque from him. The accused disputed the service of notice and prayed for dismissal of complaint.
12. The complainant in support of his case examined himself as P.W.1 and one witness as P.W.1. Both of them in their evidence affidavit stated inconsonance with the complaint case. The complainant also got marked documents at Ex.P.1 to 8. The Ex.P.1 6 C.C.No.56338/2017 and 2 are two cheques, Ex.P.3 and 4 are bank return memos, Ex.P.5 is the O/c of the legal notice, Ex.P.6 are two postal receipts, Ex.P.7 is the postal acknowledgment and Ex.P.8 is the postal track. The accused admitted that Ex.P.1 and 2 cheques are belongs to him. The accused also admitted his signature in the cheques. One cheque issued for Rs.50,000/- has been dishonoured for want of funds in the bank account of the accused and another cheque has been dishonoured with bank endorsement stating "Payment stopped by the drawer" but there is no material on record to show that when the cheque of Rs.5,50,000/- has been presented for encashment, there were sufficient bank balance in the bank account of the accused. The complainant presented the cheques in time for encashment, legal notice is in time and even the complaint is in time. Hence, the complainant has complied the statutory requirements contemplated under Sec.138(a) to (c) of N.I.Act. Hence, the initial presumption under Sec.138 of N.I.Act has to be drawn in favour of the complainant that the cheques have been issued towards the discharge of legally enforceable debt.
13. When the complainant made out a prima-facie case to draw initial presumption under Sec.139 of N.I.Act, the burden shifts on the accused to prove the contrary to the complaint case as well as to give rebuttal evidence. The specific defense made out by the accused that he has borrowed Rs.2,00,000/- from the complainant and he has repaid the same. The accused also claimed that the complainant has forcibly taken the cheques from him along with 7 C.C.No.56338/2017 rowdy elements and disputed the service of notice. All these facts to be proved by the accused himself.
14. The complainant in support of his case examined himself as P.W.1 and one witness as P.W.2. It is true that the complainant in the complaint only stated that he has advanced Rs.6,00,000/- to the accused but during the cross-examination he claimed that he has borrowed Rs.3,50,000/- from his friend Stalin and Rs.2,50,000/- was with him and he has totally paid Rs.6,00,000/-. In support of said contention the complainant examined said Stalin as P.W.2. the said P.W.2 also stated that in the 2nd week of October 2016 this complainant received Rs.3,50,000/- from him. The complainant in his evidence also stated that he has received Rs.3,50,000/- from the Stalin in the 2nd week of October 2016 and paid the amount to the accused in the 3rd week of October 2016.
15. It is relevant to note that the transaction claimed by the complainant is not totally disputed by the accused. The accused himself admitted the borrowing of money from the complainant but the accused failed to say on which month or day he has borrowed money of Rs.2,00,000/- from the complainant but the said contention sufficiently proves that the accused has borrowed money from the complainant. Of course the accused disputed the total amount claimed by the complainant. However the borrowing of money from the complainant by the accused is admitted by the accused as such 8 C.C.No.56338/2017 the burden shifts on the accused to show that he has borrowed only Rs.2,00,000/- from the complainant and also he has repaid the same.
16. It is the specific claim of the accused that he has approached one Venkataswamy for a loan. The said Venkataswamy arranged the loan for the accused through complainant. The accused also claimed that the complainant has paid Rs.2,00,000/- in installments of Rs.50,000/- each. If it were so, it is for the accused to explain on which dates he has received Rs.2,00,000/- in installments from the complainant. Further, it is the case of the accused that he has repaid the said amount in installments of Rs.50,000/- each to the complainant through said Venkataswamy. As such the said Venkataswamy is a material witness in support of the defense taken by the accused. Of course the complainant claimed that he has paid the money in presence of Venkataswamy to the accused. The said fact is not disputed by the accused. It is the claim of the accused that he has borrowed money from the complainant through said Venkataswamy and money has been repaid by the accused through said Venkataswamy. As such it is for the accused to prove the said fact and the accused ought to have examined said Venkataswamy in support of his claim but the accused failed to examine said Venkataswamy and also not given any explanation why he has not chosen to examine said Venkataswamy. Non examination of Venkataswamy by the accused in support of his evidence is certainly fetal to the defense of the accused.
9 C.C.No.56338/201717. There is also inconsistency in the defense of the accused. The accused during his evidence claimed that he has only borrowed Rs.2,00,000/- from the complainant but the said case of the borrowing of Rs.2,00,000/- from the complainant through Venkataswamy is not put to the mouth of the complainant during his cross-examination. The defense of the accused during the cross- examination of complainant is totally different from the defense of the accused during his evidence. The accused during the cross- examination of P.W.1 dtd:16.02.2018 at page No.1 in the last paragraph claimed that the complainant and accused together doing the business of supplying Vegetables to the hotels and accordingly the complainant has invested Rs.2,50,000/- in order to supply the Vegetables to the hotels. The said case is not made out by the accused during his defense evidence. Therefore, it is clear that the accused is not aware that what is actual defense in the case. This type of contradictory defense certainly creates suspicion about the defense taken by the accused. Apart from that the specific admission of the accused during his evidence also discloses that he has borrowed money from the complainant but he has failed to prove that he has received only Rs.2,00,000/- amount as claimed in his defense. Per-contra, the complainant in order to prove that he has paid Rs.6,00,000/- to the accused examined himself as P.W.1 and also examined one witness as P.W.2. It is the case of the complainant that the accused approached him in the 1st week of October 2016 and he has paid the money to the accused in the 3rd 10 C.C.No.56338/2017 week of October 2016. Similarly, the complainant during the trial claimed that in the 2nd week of October 2016 he has received Rs.3,50,000/- from D.W.2 Stalin. The evidence of Stalin also substantiates the said fact. In fact nothing has been elicited from the mouth of P.W.1 and 2 so that this court can disbelieve their evidence.
18. It is the case of the accused that he has issued the stop payment instructions but why he has issued the stop payment instructions or reason for issuing the stop payment instructions is not explained by the accused. Further, when the accused has issued the stop payment instructions or when the complainant has taken the cheque from him is also without any explanation. The accused would have easily proved the reasons for issuing the stop payment instructions by producing the copy of the said stop payment instructions given to the banker. If the copy of the stop payment instructions given by the accused to his banker has been produced before the court that would have revealed the reasons for issuing the stop payment instructions to his banker. In the absence of any such document, the claim of the accused cannot be accepted. Apart from that the accused also not produced any material before the court to show that the cheque would have been honored if there is no stop payment instructions to his banker. There is no material on record to show that there was sufficient bank balance in the bank account of the accused so that the cheque would have been honored in the absence of stop payment instructions.
11 C.C.No.56338/201719. The accused claimed that the complainant along with rowdy elements came to his office and taken away the cheques. The entire evidence of accused nowhere discloses that on which date this complainant along with rowdy elements came to his office or any place wherein the accused stayed. Further, who are those rowdy elements not explained. Further, why the accused has not initiated any legal action against those rowdy elements as well as complainant is not explained by the accused. Of course the accused claimed that though he went to lodge the complaint, the police refused to receive the complaint but there is no material to substantiate the said fact. Apart from that the police cannot refuse to receive any complaint. Further, if at all the police have refused to receive the complaint then the accused has to approach the higher authorities of the police such as Superintendent of police or he can file the private complaint before the court but the accused has failed to make out any such case to show that he has filed any complaint before the higher authorities of the police as well as before the court till this date. The accused has made out several allegations that the complainant has forcibly taken the cheques along with rowdy elements without the particulars of alleged act of complainant such as date, place and time. Hence, the claim of the accused cannot be accepted that the cheques have been forcibly taken by the complainant along with rowdy elements.
20. The accused disputed the service of notice. According to complainant the notice has been duly served on the accused as per 12 C.C.No.56338/2017 Ex.P.7. The accused not disputed his address stated in the postal acknowledgment at Ex.P.7 as well as complaint cause title and legal notice. The accused during his cross-examination also admitted his address stated in the postal acknowledgment at Ex.P.7. The postal track at Ex.P.8 also discloses that the notice has been duly served to the accused on 17.04.2017. If the notice has been returned for any reasons, certainly the claim of the accused would have been accepted that the notice has not been served to the accused. the notice sent to the accused not returned to the sender. Admittedly the notice has been sent to the proper and correct address of the accused. It is well settled principle of law that after the bouncing of cheque, the holder of the cheque has to cause a notice to the correct address of the accused. In this case the notice has been duly sent to the correct and proper address of the accused and that has not been returned to the sender and as per postal acknowledgment as well as postal track, the notice has been duly delivered. Hence, the court has no option than to accept that the notice has been duly served to the accused. In spite of service of notice, this accused failed to give any reply to the said notice. The said fact that is non replying to the notice is also one of the circumstances to accept the complaint case.
21. The accused disputed the financial capacity of the complainant. The accused during the cross-examination of P.W.1 claimed that the complainant has invested Rs.2,50,000/- in his business. Admittedly the accused himself claimed that he has borrowed Rs.2,00,000/- from the complainant. The said fact also shows that the complainant 13 C.C.No.56338/2017 has the financial capacity to advance the money as claimed in the complaint. It is relevant to note that the complainant claimed that he has received Rs.3,50,000/- from one Stalin / P.W.2 in the 2nd week of October 2016 and paid the amount to the accused in the 3rd week of October 2016. In support of said contention the complainant examined said Stalin as P.W.2. As already stated earlier, nothing has been elicited from the mouth of complainant and P.W.2 so that their evidence can be disbelieved. Therefore, the evidence of P.W.1 and 2 as well as claim of the accused sufficiently discloses that the complainant has the capacity to advance the loan as claimed in the complaint.
22. The accused also claimed that the complainant is a Government employee as such he cannot advance money without obtaining permission from the higher or concerned authorities. It is true that as per KCSR the complainant has to obtain necessary permission either to advance or borrow money exceeding the prescribed limit but that itself does not disentitled the complainant from recovering the amount advanced as a loan particularly when the complainant shows his source of income and financial capacity. Further as per Rule 21 of Karnataka Civil Service Rules, the employee is permitted to advance one month salary as a loan to relative and friends. Any advancing of loan extending one months salary does not requires the prior permission. Of course it may be the violation of rules and subject to disciplinary actions. The said disciplinary action has to be taken by the concerned higher authorities of the complainant.
14 C.C.No.56338/2017Further, mere advancing the money to the friend itself is not a crime and the object of aforesaid rules is to hold the official accountable and if the complainant shows his source of income certainly he can advance the money. Therefore, merely the complainant has not obtained any permission from the higher authority itself is not a ground to dismiss the claim of the complaint.
23. It is relevant to note that there is no material on record to show that the complainant is indulged in any money lending business even there is no material on record to show that the complainant has to advance the money to any person other than the accused. Further if really the complainant has violated the rules prescribed under conduct rules then his drawing officer has to take necessary action or competent authorities are there to initiate proceedings against the complainant but that itself is not a ground to discard the entire complaint case. Therefore, for the aforesaid reasons this court is of the humble opinion that the complainant proved his case beyond reasonable doubt.
24. In this case, the complainant has claimed compensation. As per Section 357 of Criminal Procedure Code and as per the ruling reported in; 2001 Cri.L.J. 950 (SC), (Pankajbai Nagibai Patel V/s State of Gujarath), the court can award compensation and there were no limits for the same. As such, the court has to consider how much compensation could be awarded in this case. As per Section 80 of Negotiable Instruments Act, the interest at 18% P.A. 15 C.C.No.56338/2017 can be granted when there is no agreed rate of interest. As per the proved facts of the case, the accused has issued cheque towards the legally enforceable debt, the accused has issued a cheques dated 02.01.2017 & 18.01.2017 as per Ex.P.1 & 2 and thus, the accused has to pay interest on the cheque amount from the date of cheque and so, the accused has to pay interest for about 1 year 11 months till this date. If the interest is calculated at 18% P.A. to the cheque amount for the above period, certainly, the complainant is entitled for the suitable compensation to the cheque amount as per Section 80 of Negotiable Instruments Act. The cheques amount in this case is Rs.6,00,000/- and if the interest is calculated for 23 months, the accused shall pay the interest to the complainant at 18% P.A. that amounts to Rs.2,07,000/-. The case is pending nearly about 1 ½ year as such if the cost of Rs.1,000/- is added to the compensation, it will comes to Rs.8,08,000/- (Cheque amount is Rs.6,00,000/-, interest is Rs.2,07,000/- and cost Rs.1,000/-). Hence, this court is of the humble opinion that in all the complainant is entitled for compensation amount of Rs.8,08,000/-. Further as per the ruling reported in 2000 Cri.L.J 1793(b) SC - (State of Karnataka V/s Krishnappa) wherein it is held that while imposing sentence, the courts are expected to properly operate sentence system, it should be impose such sentence for code offence which serve as detention of commission of like offences by others - Socio economic status, prestige, race, caste or creed of accused or victim are irrelevant considerations in sentencing policy. Hence, in this case also, if the 16 C.C.No.56338/2017 accused is punished with simple imprisonment for one year and pay compensation to the complainant. Anyhow the object of Sec.138 of N.I.Act is to have accountability in the business transaction and the intention of the complainant is only to get his money back. The complainant certainly not interested in sentencing the accused for any imprisonment. Further, the offence is punishable with imprisonment or fine. Anyhow the object of Sec.138 of N.I.Act is to have accountability in the business transaction and the intention of the complainant is only to get his money back. The complainant certainly not interested in sentencing the accused for any imprisonment. Further, the offence is punishable with imprisonment or fine. Hence, in this case after awarding the compensation certainly imposing of fine to the accused is sufficient sentence.
25. As per the ruling reported in 2002 Cri.L.L. 1003, SC (Suginthi Suresh Kumar V/s Jagadishan). Where in it is held at page no.1005, at para 5 that:
"In the said decision this court reminded all concerned that it is well to remember the emphasis laid on the need for making liberal use of Section 357(3) of the Code. This was observed by reference to a decisions of this Court in 1988 (4) SCC 551 Hari Singh v. Sukhbir Singh. In the said decision this court held as follows:17 C.C.No.56338/2017
"The quantum of compensation may be determined by taking into account the nature of crime, the justness of the claim by the victim and the ability of accused to pay. If there are more than one accused they may be asked to pay in equal terms unless their capacity to pay varies considerably. The payment may also very depending upon the acts of each accused. Reasonable period for payment of compensation, if necessary by installments, may also be given. The court may enforce the order by imposing sentence in default."
26. In view of the aforesaid precedent of Hon'ble Apex Court, if the accused is ordered to further imprisonment of a year in default to pay the compensation will make the ends of justice. Accordingly I answer the above point in "Affirmative". In the result, following;
ORDER Acting under Section 255(2) of Cr.P.C., the accused is hereby convicted for the offence punishable under Sec.138 of N.I.Act and sentenced the accused to pay a fine of Rs.5,000/-. In default to pay the fine amount the accused shall undergo simple imprisonment for 3 months.
Acting under Section 357 of Cr.P.C., the compensation is awarded and the accused shall pay compensation of Rs.8,08,000/- to the complainant. In default to pay compensation, the accused shall undergo simple imprisonment of a period of 1 year.
18 C.C.No.56338/2017Office to furnish free copy of this judgment to the accused forthwith.
(Dictated to the Stenographer, transcript thereof is corrected and then pronounced by me in the open court on this the 4TH day of December, 2018) (PADMA PRASAD), LVII ACMM, BENGALURU.
ANNEXURE
1. Witnesses examined on behalf of Complainant:
P.W.1 : Sri.M.Subramaniam
P.W.2 : Sri.K.Standly @ Stalin
2. Documents marked on behalf of complainant:
Ex.P.1 & : Original Cheque
Ex.P.2
Ex.P.1(a) : Signatures of the accused
&
Ex.P.2(a)
Ex.P.3 & Bank Return Memos
Ex.P.4
Ex.P.5 : O/c of the legal notice
Ex.P.6 : 2 Postal Receipts
Ex.P.7 : Postal Acknowledgment
Ex.P.8 : Postal Track
19 C.C.No.56338/2017
3. Witnesses examined on behalf of Accused:
D.W.1 : Sri.M.Munivenkataiah
4. Documents marked on behalf of Accused:
- Nil -
(PADMA PRASAD)
LVII ACMM, BENGALURU.