Bangalore District Court
Emvee Solar Systems vs Lumen Industries on 30 April, 2024
KABC030241182016
Presented on : 12-04-2016, Registered on : 12-04-2016
Decided on : 30-04-2024, Duration : 8 years, 0 months, 18 days
IN THE COURT OF XXVII ADDL. CHIEF METROPOLITAN
MAGISTRATE, BENGALURU
Present: Sri. K.N. SHIVAKUMAR B.Sc (Agri), LL.M.,
XXVII A.C.M.M Bengaluru.
Dated: This the 30 th day of April, 2024
C.C. NO.9692/2016
Complainant M/S. EMMVEE SOLAR
SYSTEMS (P) LTD.,
Office at No. 55, 6th Main Road,
11th Cross, Lakshmiah Block,
Ganganagar,
Bengaluru 560024.
(Duly Represented by its
Deputy Manager Recovery
Sri. Naveen Rafugar
S/o. Srinivasa Rafugar,
Aged about 30 Years.
(Rep by Sri. K.N. Harish
Babu., Adv)
Vs.
Accused 1. M/S. LUMEN INDUSTRIES,
No.12.15, Gowdown,
No.1, 1st Avenue Business Park,
Opp. Fire Station,
Dughadi Chowk,
Kalyan West Dist,
Thane - 421 301.
2. SRI. AJITH MATHEW
Authorized Signatory,
No.12.15, Gowdown,
No.1, 1st Avenue Business Park,
Opp. Fire Station,
Dughadi Chowk,
Kalyan West Dist,
Thane - 421 301.
(Rep by Sri. Chandrashekara K,Adv)
Offence
U/s.138 of Negotiable Instruments Act.
2 C.C. NO.9692/2016
Plea of the accused Claims to be tried
Final Order CONVICTED
Judgment Date 30/04/2024
****
JUDGMENT
This is a complaint filed by the complainant U/Sec. 200 of Cr.P.C for the offence punishable under Sec.138 R/w Sec. 142 of N.I. Act as against the accused praying to punish the accused for the said offence.
2. The facts of the case in brief are as follows:-
It is the case of the Complainant that, the complainant is the manufacturer of solar water heaters . The accused purchased the systems from the complainant on different dates under different invoices. Towards the discharge of part liability, the accused had issued Cheque bearing No.048424, dated: 24/04/2013 for a sum of Rs.4,00,000/- drawn on ING Vysya Bank 3 C.C. NO.9692/2016 Ltd., Kalyan branch, Thane in favour of the complainant. The complainant presented the said cheque for encashment through its banker State Bank of India, CCP, Hebbal branch, Bengaluru and the same got dishonoured and returned with memo dated:
26/04/2013 stating " FUNDS INSUFFICIENT ". Thereafter, the complainant got issued legal notice dated: 22/05/2013 to the accused through RPAD calling upon him to pay the amount covered under the aforesaid cheque within 15 days from the date of receipt of notice. But the accused has neither replied to the notice nor paid the amount covered under the aforesaid cheque. Hence, this complaint.
3. After recording the sworn statement of the representative of the complainant company by name Naveen Rafugar and also verifying the documents, cognizance was taken against the accused for the offence punishable under Sec. 138 R/w 142 of N.I. Act. The 4 C.C. NO.9692/2016 accused on receiving the summons appeared before the Court through his counsel and was enlarged on bail and his plea was recorded. The accused pleaded not guilty but, claimed to have defence. Hence, the case was posted for evidence of the complainant.
4. The Representative of the complainant company by name Naveen Rafugar got examined himself as PW 1 by adopting the affidavit and the documents filed in lieu of his sworn statement as the affidavit in lieu of examination in chief as per the guidelines of Hon'ble Apex Court of India, in the case Indian Bank Association & Ors V/s. Union of India & Ors, reported in (2014) 5 SCC 590 and got marked additional documents as per Ex.P.1 to 9. Subsequently, one Mr.Harish.B, authorized signatory of the complainant company got substituted in place of PW 1and who got examined himself as PW.2 by filing an affidavit in lieu of his examination in chief and got 5 C.C. NO.9692/2016 adopted the documents marked as Ex.P 1 to 9 during the sworn statement of earlier representative PW 1 and got marked additional documents at Ex.P.10 to 32. Then the case was posted for recording the Statement of accused under Sec.313 of Cr.P.C. In the statement under section 313 of Cr.P.C, the accused has denied all the incriminating evidences appearing against him. The accused has not let-in his side oral evidence and no documents are marked on his behalf. Then, the matter was posted for Arguments.
5. Heard the arguments of the advocate for the complainant. The counsel for the accused did not turn up for arguments. Perused the records.
6. The following points arise for my consideration:
1. Whether the complainant proves that the Cheque bearing No.048424 for a sum of Rs.4,00,000/- dated: 24/04/2013 drawn on ING Vysya Bank Ltd., Kalyan branch , Thane issued by the accused has been dis-
honored on the ground of "Funds Insuffi-
cient" and the accused even after receiving 6 C.C. NO.9692/2016 the intimation regarding the dishonor of cheque failed to pay the cheque amount within the stipulated period and thereby ac- cused has committed an offence punishable under Sec.138 of N.I. Act?
2. What order?
7 . My findings on the above points are as under
Point No.1: I n t he A f f i r m a t i v e Point No.2: As per final order, for the following:
R EAS O N S
8. Point No.1 : In view of the present legal position as held by our Hon'ble High Court as well as Apex Court of India in a catena of decisions as well as relevant provisions of the Act, this court has to see whether the complainant has complied all the requirements as contained in Sec.138 of NI Act so as to bring home the guilt of the accused for the alleged offence. If so, whether the accused is able to rebut the legal presumption available to the complainant under Sec.139 of the Act by adducing probable defense or not. However, it is held by 7 C.C. NO.9692/2016 the full bench of our Apex Court in the case of Rangappa Vs. Mohan reported in 2010 (1) DCR 706 that ;
"The Statutory presumption mandated by sec.139 of the Act, does indeed include the existence of a legally enforceable debt or lia - bility. However, the presumption U/S 139 of the Act is in the nature of a rebuttable pre- sumption and it is open for the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested" .
9. Therefore, in view of the above decision once the cheque is admitted, the statutory presumption would au- tomatically fall in favour of the complainant that, the al- leged cheque was issued for the discharge of an existing legally enforceable debt or liability against the accused and the burden will shift on to the accused to rebut the same.
10. The learned counsel for the complainant has submitted the arguments contending that the accused 8 C.C. NO.9692/2016 has admitted the cheque and his signature thereon. Though he has cross-examined PW1, he has failed to re- but the presumption U/sec.139 of the Negotiable Instru- ments Act in favour of the complainant. Hence, he is li- able to be convicted.
11. On the other hand advocate for the ac-
cused though not submitted any arguments in the course of cross-examination of PW 1, it is con - tended that, the accused was neither due for Rs.4,00,000/- as claimed in the complaint nor is - sued any cheque towards discharge of any such due. Rather, the said cheque was issued as secu - rity towards the transaction of accused with the complainant at the time of commencement of business. Said cheque was issued in blank with the signature of the accused, which was filled up by the complainant itself and presented for en - cashment to file this false complaint against the 9 C.C. NO.9692/2016 accused. The complainant has not produced any materials to show that they have supplied the goods worth Rs.4,00,000/- and the accused was due for the said amount. As such, the accused has not committed any offence u/s.138 of N.I Act. Hence, the complaint is liable to be dismissed.
12. Now, on the basis of the materials available on record, it is required to examine whether the com- plainant has complied with the provisions of Section 138 of N.I Act to get cause of action to file this complaint. The complainant besides his oral testimony has relied on the documents at Ex.P2 to 8 in support of his contentions. Ex.P2 is the cheque alleged to have been issued by the accused, Ex.P.3 is the Return memo issued by the Banker of the accused with the endorsement "FUNDS IN- SUFFICIENT", Ex.P4 is the copy of legal notice issued by the complainant, Ex.P5 & 6 are the postal receipts for having sent notice to the accused, Ex.P.7 & 8 are the 10 C.C. NO.9692/2016 unserved postal covers with endorsement 'unclaimed'. All these documents corroborate the version of the com- plainant in his complaint as well as affidavit in lieu of chief examination and more over these documents are not at all disputed by the accused except service of notice and issuance of the cheque, which would be discussed in detail later. Thus, complainant with the help of Ex.P.2 to 8 has conveniently proved to have complied the provisions of Section 138 i.e. presentation of cheques within the statutory period for encashment, issue of legal notice within prescribed period to the Accused and filing of complaint within limitation period as per section 142 of the Act.
13. Regarding the service of notice, it is stated by the complainant that the legal notices sent to the official ad- dress as well as the residential address of the accused through RPAD were returned unserved with the postal endorsement 'unclaimed' as per Ex.P.7 & 8. In the 11 C.C. NO.9692/2016 course of cross-examination of the PW 1, it was sug- gested that said notices were given to wrong address & the address mentioned in the complaint is wrong. The accused is not residing in the said address. Though it is known to the complainant, they have intentionally sent said notice to such wrong address. But said notices were unserved not because of wrong address, but because of 'unclaim' by the addressee. Moreover, though accused contended that said addresses are wrong, he has neither stated nor produced any documents as to the correct ad- dress of the accused. Therefore, merely on the basis of bare denial and mere suggestions, it cannot be con- cluded that said notices were sent to wrong addresses. Rather, in the absence of any materials to show that said addresses are wrong, it can be inferred that the com- plainant had issued said legal notice to the correct and last known address of the accused. "When the statu - tory notice is sent to the correct address of the ad - dressee, even if the same is returned unserved on the 12 C.C. NO.9692/2016 grounds of either refusal or not claim or absence of the addressee, the same amounts to deemed service as held by Hon'ble Apex Court in the case of M / S Indo Automobiles Vs. M/S. Jaidurga Enterprises r e p o r t e d i n 2 0 0 8 ( 2 ) D C R 4 9 9 and also as provided under S e c . 2 7 o f t h e M y s o r e g e n e r a l c l a u s e s A c t , 1897. More over, the entire purpose of giving notice is to give an opportunity to the drawer to pay the cheque amount within 15 days and there by free him - self from the penal consequences of Sec.138 of the Act as observed by our Hon'ble H i g h C o u r t in the case of S r i . P r a k a s h @ G n a n a P r a k a s h v / s M i s s . T.S. Susheela reported in ILR 2012 KAR 4815. Thus, the said notice is deemed to have been served on the accused.
14. The second aspect of the case is whether the ac- cused has successfully rebutted the presumption avail- able in favour of the complainant with probable and con- vincing evidences? It is well settled principle of law that, 13 C.C. NO.9692/2016 once the cheque is admitted there will be a statutory pre- sumption in favour of the holder or holder in due course U/Ss 118 and 139 of the Act. However, as held by our Hon'ble Apex Court and the High Court in a catena of de- cisions, the presumptions under the said sections are in the nature of rebuttable presumptions and hence, the ac- cused can very well rebut the said presumptions by lead- ing reasonable and probable defence. Let us examine the same on the basis of the materials available on record.
15. It is the case of the complainant that, the com- plainant has supplied water heater systems to the ac- cused on credit basis on different dates under different invoices. Towards partial discharge of said liability due and payable, the accused issued the Cheque at Ex.P.2 for Rs.4,00,000/-. On the other hand, it is the defence of the accused that, he was neither due for Rs.4,00,000/- as alleged in the complaint nor issued said cheque Ex.P.2 towards discharge of the same. Rather, said 14 C.C. NO.9692/2016 cheque Ex.P.2 was issued in blank with the signature of the accused as a security towards said transactions.
16. In support of the case of the complainant the Representatives of the complainant company got exam- ined as PW1 & 2 and produced Ex.P.1 to 32 documents. With regard to the alleged transaction of the accused, the PW 2 got produced the statement of account or ledger ac- count extract as per Ex.P.9. In the entire course of cross-examination of PW 2 the accused neither denied nor disputed said ledger extract Ex.P.9. On perusal of the entire testimony of PW 1 & the documents such as E- mail communications at Ex.D1 & 2 which were con- fronted by the accused himself to the PW 1, it appears very clear that the accused has indirectly admitted al- leged transactions with the complainant company. Though the accused has not disputed the ledger account extract Ex.P.9, in the course of cross-examination, he has confronted said E-mail communications Ex.D1 & 2 15 C.C. NO.9692/2016 and contended that the complainant company had re- ceived subsidy benefit from the Government, but not transferred the same to the customers. Similarly, it was also contended that in respect of alleged business, there was a dealership agreement between the accused and the complainant . As per the said dealership agreement, the accused was entitled for commission and there was a due of Rs.1,18,800/- as commission towards the accused which was not paid by the complainant. But the PW 1 though admitted that there is such dealership agree- ment, he has denied that same was related to the com- mission payable to the accused. But the accused sug- gested that on 31/03/2011, he has issued a letter to the complainant stating that there was a due of Rs.1,18,800/- towards commission, which was denied by the PW 1. As such, the burden lies on the accused to show that he had issued such an intimation to the com- plainant. But, though the accused himself alleged to had issued such letter, he has not produced copy of any such 16 C.C. NO.9692/2016 letter or any document in proof of sending any such let- ter to the complainant either through post or courier or E-mail communication or any other modes. Therefore, this contention of the accused only on the basis of mere suggestion would not take place of proof.
17. Further though accused has confronted and marked the E-mail communications at Ex.D1 & 2 and contended that the complainant company has not trans- ferred the benefit of subsidy to the customers. On pe- rusal of said Ex.D1 & 2, it appears very clear that the Ex.D1 is a communication relating to reimbursement to- wards installation and lifting charges and the sales com- mission @ 6% and 4% respectively in respect of different customers. Said Ex.D1 also reveals that an amount of Rs.1,78,575/- was credited towards the reimbursement of the same to the account of the accused and furnishing copy of the ledger account of the accused, the com- plainant appears to have requested him to clear the out- 17 C.C. NO.9692/2016 standing balance for the financial year ending 31/03/2010. Similarly, the Ex.D2 appears to be an E- mail communication requesting the accused to furnish requisite documents for claiming subsidy in respect of 5 different customers as mentioned therein. It is not clear as to whether the accused has furnished the documents as sought for under said Ex.D2. In the course of entire cross-examination of PW1, nothing was suggested or elicited as to whether the requirement of said letter was complied or not. Therefore, it appears very clear that none of Ex.D1 & 2 give any inference as to any subsidy required to be paid to the customers of the accused was due from the complainant company. Moreover, though the accused contended that the complainant company has not transferred the benefit of subsidy to the cus- tomers, he has neither stated as to how much was said subsidy nor produced any document to show that the complainant company was due to pay such amount of subsidy. Similarly, he has neither stated nor produced 18 C.C. NO.9692/2016 any materials to show as to how much was the commis- sion that was due from the complainant company as on the alleged date of cheque Ex.P.2. As already discussed herein above, the accused appears to have not given any demand notice in respect of alleged subsidy as well as the commission amount. If at all, as alleged by the ac- cused the complainant company was due to pay any such subsidy or the commission, what prevented the ac- cused to make a demand for the same either by way of issuing demand notice or sending any E-mail communi- cation or requisition. In the absence of any such mate- rial particulars, it cannot be accepted only on the basis of mere suggestions and bare denials that the com- plainant company was due to pay subsidy and commis- sion to the accused. For this proposition, this court is fortified by the decision of Hon'ble High court of Kar- nataka in the case of Siddappa Vs. Smt. Chand bee Hyderabad reported in 2014 Cr.R 646 (kant), wherein it was held as follows :
19 C.C. NO.9692/2016
'Mere suggestion and bare denials would not constitute the probable defence to rebut the presumption available in favour of the com- plainant U/S 139 of the Act, rather he has to lead some probable defence which would preponder upon the evidence lead by the complainant' Further as already discussed herein above, the complainant got produced the ledger account extract at Ex.P.9 to show that the accused did such periodi- cal transactions with the complainant and he was due for payment towards the same. As already dis- cussed herein above, the accused neither denied nor disputed said Ex.P.9 and the contents therein. How- ever, in the course of cross-examination of PW 1, he has contended that the complainant company has not produced the Income tax returns, Audit report, Balance sheet, wherein the due of the accused al- leged to be reflected. In this regard, the accused also made an application u/s.91 of Cr.P.C., for direc- tion to the complainant to produce those documents. Pursuant to said application and the direction of 20 C.C. NO.9692/2016 Hon'ble High Court of Karnataka in Crl.Pet.No.1415/2020 dtd: 11/10/2023, the com- plainant got produced such documents like 12 Tax invoices as per Ex.P.11 to 22, 8 Audit reports and Balance sheets as per Ex.P.23 to 30, a ledger ac- count extract as per Ex.P.31 and the Draft dealer agreement as per Ex.P.32. But the accused did not chose to cross-examine PW 1 on all the above said documents which were demanded for production by the accused himself. As such, an adverse inference as to such defences of the accused could be drawn along with concluding that the said documentary ev- idences stood unrebutted and unchallenged. There- fore, it can be held that the complainant has proved alleged transaction with the accused and due of the accused towards said transaction with cogent and convincing evidences. On the other hand, the ac- cused has utterly failed to disprove any of the allega- tions made in the complaint. Though he has simply 21 C.C. NO.9692/2016 contended that the said cheque Ex.P.2 was issued in blank with signature of the accused as security, he has neither proved nor produced any materials to substantiate the same. If at all, this contention of the accused is true, he could have produced the counter-foil of cheque book from which said cheque Ex.P.2 was drawn and also he could have produced the statement of account of his bank account for the relevant period with relevant entries as to encash- ment of the series of cheques that were subsequent to the series of cheque Ex.P.2 so as to substantiate or probabalize his said contention. In the absence of any such materials or evidences, it cannot be ac- cepted that said cheque was issued as security only on the basis of mere suggestions.
18. In view of all the above discussed facts and circumstances, the version of the complainant that the alleged cheque-Ex.P.2 was issued by the accused to- 22 C.C. NO.9692/2016 wards payment of dues of Rs.4,00,000/- payable to the complainant company appears more probable than the defense of the accused that the alleged cheque was is- sued as security to the complainant company.
19. In view of all the above discussion, it can be concluded that the complainant has established through cogent and convincing evidence, the fact of issuance of the cheque for discharge of legally enforceable debt, which is dishonored for "Funds Insufficient ", issuance of legal notice within stipulated time, failure on the part of Accused to repay the amount within stipulated period. On the other hand, the accused has failed to rebutt the presumption available to the complainant through prob- able evidences, that would preponderate upon the evi- dence lead by the complainant. Therefore, the Accused is held to have committed an offence punishable under sec. 138 of N.I. Act. Accordingly Point No.1 is answered in the Affirmative.
23 C.C. NO.9692/2016
20. POINT NO.2:- In view of my answer to Point No.1, I proceed to pass the following:-
: O R D E R : Acting u/s 255(2) of Cr.P.C. the accused is hereby held guilty of the offence P/U/S 138 of N.I.Act and sentenced to fine of Rs.7,50,000 / In default of payment of fine the accused shall undergo simple imprisonment for 2 years. Acting u/s 357(1)(b) of Cr.P.C it is hereby directed to pay Rs.7,00,000 / to the complainant towards the compensation, and the remaining fine amount of Rs.50,000/ shall be paid to the State.
(Dictated to the stenographer directly on computer, corrected and then pronounced in open court by me on this the 30 th day of April, 2024) (K.N. SHIVAKUMAR) XXVII A.C.M.M., Bengaluru.
ANNEXURE Witnesses examined on behalf of the complainant:
PW1 : Naveen Rafugar PW 2 : Harish.B
Documents marked on behalf of the complainant Ex.P1 : Extract of Minutes of Meeting 24 C.C. NO.9692/2016 Ex.P2 : Cheque Ex.P.2(a) : Signature of the accused Ex.P3 : Bank Endorsement Ex.P4 : Office copy of legal notice Ex.P5&6 : Postal receipts Ex.P7&8 : Postal covers Ex.P9 : Statement of accounts Ex.P9(a) : 65B certificate Ex.P.10 : Board Resolution Ex.P.11-22 : Invoices Ex.P.23-30 : Audit reports Ex.P.31 : Ledger account extract & 65B certificate Ex.P.32 : Draft dealer agreement Witnesses examined on behalf of the accused:
-Nil-
Documents marked on behalf of the accused:
-Nil-
XXVII A.C.M.M Bengaluru.