Bangalore District Court
M/S. Maruthi Traders vs M/S. Slv Traders on 4 April, 2018
IN THE COURT OF THE XX ADDL.CHIEF METROPOLITAN
MAGISTRATE AT BENGALURU CITY
Dated this the 4th day of April 2018
PRESENT: KALPANA.M.S.,
B.Sc., LL.M.,
XX ADDL. C.M.M. Bengaluru.
C.C.No.13918/2017
Complainant : M/s. Maruthi Traders,
A proprietorship firm,
Office at No.113, Thotadaguddadahalli,
Near Govt. High School,
Nagasandra Post, Bengaluru.
Represented by its authorized signatory,
Sri.Anil Kumar.S
Vs.
Accused : 1.M/s. SLV Traders,
Represented by Indresh,
Office at No.04, 7th Cross,
B.T.Krishnappa Layout,
Lakshmipura Main Road,
Abbigere,
Near Gangamma Gudi police station,
Bengaluru - 560 090.
2. Sri.Indresh,
Residing at No.5/1B, 5th Cross,
Kuvempu Layout,
Chikkasandra,
Bengaluru - 560 044.
Offence complied of : U/S. 138 of N.I. Act.,
2 C.C.13918/2017
Plea of accused : Pleaded not guilty
Final Order : Accused No.1 & 2 are Convicted
Date of Order : 04-04-2018
JUDGMENT
The complainant has filed this complaint through authorized signatory under section 200 of code of criminal procedure read with section 138 & 141 of the Negotiable Instruments Act ( in short referred as "N.I. Act") against the accused alleging that, they have committed the offence.
02. The sum and substance of the complaint, is as follows;
The complainant is the dealers for cement and steel and they are running their business in the name and style of 'Maruthi Traders'. The accused is the one of the customer of the complainant and he used to purchase the cement on credit basis from the complainant. The accused has purchased cement bags from 29.12.2016 to 07.02.2017 under various tax invoices and on various dates for total amount of Rs.6,54,332/- from the 3 C.C.13918/2017 complainant, out of which the accused has paid a sum of Rs.1,49,600/- by way of cheque. Towards repayment of remaining balance amount of Rs.5,49,000/-, the accused has issued five cheques in favour of complainant. i.e.,
(a). Cheque bearing No.692743 dated 30.12.2016 for Rs.1,49,600/-,
(b). Cheque bearing No.692763 dated 04.02.2017 for Rs.1,00,000/-,
(c). Cheque bearing No.692762 dated 04.02.2017 for Rs.1,00,000/-,
(d). Cheque bearing No.692761 dated 06.02.2017 for Rs.1,00,000/- &
(e). Cheque bearing No.692760 dated 06.02.2017 for Rs.1,00,000/-. All the cheques were drawn on SBM, Chikkabanavara Branch, Bengaluru. Complainant presented the said cheques in serial No. (b) to (e) for encashment through his banker i.e., The Bengaluru City Co-Op Bank Ltd., T.Dasarahalli Branch, Bengaluru on 31.12.2016 and the said cheques returned with an endorsements "Funds Insufficient", dated 02.01.2017 and 15.02.2017. Thereafter, complainant got issued legal notice on 07.03.2017 to accused. The notice was duly served to the accused on 09.03.2017. Accused neither replied the notice nor paid the cheque amount. Hence, this complaint. 4 C.C.13918/2017
03. On filing of complaint, this court has taken cognizance for the offence punishable under section 138 of Negotiable Instrument Act, sworn statement of complainant was recorded. Being satisfied that there are prima-facie materials to proceed against accused, summons was issued. After appearance, accused enlarged on bail and plea was recorded as per section 251 of Cr.P.C. Accused has not stated the defence.
04. In order to prove his case, complainant examined his authorized signatory as PW.1 and got marked documents from Ex.P.1 to 18. The statement under section 313 of code of criminal procedure is recorded, read over and explained to the accused. The defence of the accused is total denial. Further accused examined as DW.1 and got marked one document at Ex.D.1.
05. In this case, the evidence on record shows that summons trial procedure was adopted instead of summary trial. As per the judgment passed by Supreme Court reported in 2014 Cr.L.J. 1953, in a case of Mehsana Nagarik Sahakari Bank 5 C.C.13918/2017 Limited V/s. Shreeji CAB Company Limited and others, conducting Denova trial does not arises.
06. Heard the Learned Counsel for complainant and accused. Perused the citations and materials on record.
07. The points that arise for my consideration are as follows;
POINTS
1. Whether the complainant proves that, accused issued four cheques for Rs.1,00,000/- each, towards discharge of their liability, which were returned unpaid on presentation and also not complied the notice issued by the complainant and thereby committed an offence punishable under section 138 of Negotiable Instruments Act?
2. What Order?
My answer to the above points is as follows;
1. Point No.1: In the Affirmative
2. Point No.2: As per final order for the following;
6 C.C.13918/2017
REASONS
08. POINT No.1: Complainant has filed this complaint alleging that accused has committed offence under section 138 of N.I. Act. He pleads and asserts that, towards discharge of his liability, accused has issued four cheques for Rs.1,00,000/- each, drawn on SBM, Chikkabanavara Branch, Bengaluru. The said cheques came to be dishonoured on presentation. Complainant has issued notice within time stipulated calling upon the accused to pay the amount covered under cheque. Inspite of service of notice accused has not paid the amount within 15 days, which gave cause of action to file this complaint. He further relied on the documents from Ex.P.1 to
18. This witness was subjected to cross examination.
09. In this scenario, let us scrutinize the documents relied by complainant in order to examine the compliance of statutory requirements envisaged under section 138 of N.I. Act. Ex.P.1 to 4 are cheques dated 04.02.2017 and 06.02.2017 Ex.P.5 to 8 are bank endorsements dated 15.02.2017, Ex.P.9 is legal notice dated 07.03.2017 and the said notice served on 7 C.C.13918/2017 09.03.2017, Ex.P.10 & 11 are postal receipts, Ex.P.12 & 13 are Postal acknowledgements, Ex.P.14 authorization letter, Ex.P.15 Form VAT 7, Ex.P.16 IT Commercial tax receipt, Ex.P.17 Form No.4 and Ex.P.18 is CST. This complaint came to be filed on 13.04.2017. A careful scrutiny of the documents relied by the complainant goes to show that, statutory requirements of section 138 of N.I. Act is complied with and this complaint is filed within time. Thus, complainant relied on the statutory presumptions enshrined under section 118 read with section 139 of N.I. Act.
10. No doubt, the said presumptions of law are rebuttable in nature. The accused can take probable defence and rebut the presumption available to the complainant. Let us examine whether accused has successfully rebutted the presumptions of law. It is the specific defence of the accused that, the complainant is the proprietorship concern belongs to Smt.Jayamangala. This complaint came to be filed by the authorized signatory Sri.Anil Kumar.S. The proprietrix has not given Power of Attorney to the authorized signatory to prosecute 8 C.C.13918/2017 this proceedings. On this contention, it is argued that, complaint is prima-facie not maintainable. One more defence of the accused is that, he has already paid the amount towards purchase of cement from the complainant. Thus, accused is not liable to any amount to the complainant much less claimed amount. On these two contentions, accused opposed the present complaint. To endorse these contentions, accused examined as DW.1 and relied on the bank statement at Ex.D.1. This witness was subjected to lengthy cross examination.
11. As stated earlier, accused disputed competency of the complainant to prosecute this complaint. In support of this contention, accused relied on the decision reported in , KCCR 2007 (2) 1103 between Ranjitha Balasubramanian Vs. Shanthi Group, wherein it is held that;
"In the absence of Power of Attorney, the complaint is not maintainable."9 C.C.13918/2017
12. Per contra, complainant relied on the decision of Hon'ble Supreme Court of India in, 2008 (4) KCCR, between Shankar Finance and Investments Vs. State of Andhra Pradesh and ors, wherein it is held that;
" In regard to business transactions of companies , partnerships or proprietary concerns, many a time the authorized agent or attorney holder may be the only person having personal knowledge of the particular transaction; and if the authorized agent or attorney-holder has signed the complaint, it will be absurd to say that he should not be examined under section 200 of the Code, and only the Secretary of the company or the partner of the firm or the proprietor of a concern , who did not have personal knowledge of the transaction, should be examined. Of course, where the cheque is drawn in the name of the proprietor of the proprietary concern, but an employee of such concern (who is not a attorney holder) has knowledge of the transaction, the payee as complainant and the employee who has knowledge of the 10 C.C.13918/2017 transaction, may both have to be examined."
The Hon'ble Supreme Court clearly laid down that, the authorized agents, who has knowledge of the business transaction are competent person to file the complaint and also prosecute the same. In the present case, accused has unequivocally admitted in his evidence that, he has purchased the cement from the authorized person of the complainant i.e., Sri Anil Kumar. Such being the case, this contention taken by the accused is devoid of merits. For better appreciation, the relevant portion of evidence of DW.1 is culled out as under;
É É C¤¯ï PÀĪÀiÁgÀ JA§ÄªÀªÀgÀÄ ªÀiÁgÀÄw mÉæÃqÀgïì ºÉ¸Àj£À°è ¹ªÉÄAmï ªÀÄvÀÄÛ PÀ©âtzÀ ªÁå¥ÁgÀ ªÀiÁqÀÄwÛzÀÝgÀÄ JAzÀgÉ ¸Àj. £Á£ÀÄ CªÀgÀ §½ ¹ªÉÄAmï ªÀÄvÀÄÛ PÀ©ât Rjâ ªÀiÁqÀÄwÛzÉÝ JAzÀgÉ ¸Àj. zÀÆgÀÄzÁgÀgÀ §½ £Á£ÀÄ ¸Á®zÀ DzsÁgÀzÀ ªÉÄÃgÉUÉ ªÀ¸ÀÄÛUÀ¼À£ÀÄß vÉUÉzÀÄPÉƼÀÄîwÛzÉÝ JAzÀgÉ ¸ÁQë £ÁzÀÄ ªÀÄvÀÄÛ ¸Á®zÀ gÀÆ¥ÀzÀ°è ªÀåªÀºÁgÀ ªÀiÁqÀÄwÛzÉÝ JAzÀÄ ºÉüÀÄvÁÛgÉ. This part of evidence of accused clearly establishes that, authorized signatory is having knowledge of the present 11 C.C.13918/2017 transaction. Thus, this contention of the accused holds no water.
13. Further, this court scrutinized the materials on record in the back drop of the defence taken by the accused. It is clear that, accused has not disputed the business transaction with the complainant and purchase of the cement on credit basis. Accused has not disputed the issuance of cheques in favour of the complainant towards payment of the purchases made by him. For better appreciation, the relevant portion of evidence of DW.1 is culled out as under;
É É £Á£ÀÄ ¢£ÁAPÀ 29.12.2016 jAzÀ 07.02.2017 gÀªÀgÉUÉ zÀÆgÀÄzÁgÀgÀ PÀqɬÄAzÀ ¸Á®zÀ gÀÆ¥ÀzÀ°è gÀÆ.6,54,332 ªÉÆvÀÛzÀ ªÀåªÀºÁgÀ ªÀiÁrzÉÝÃ£É JAzÀgÉ ¸Àj. ......£Á£ÀÄ zÀÆgÀÄzÁgÀjUÉ ¢£ÁAPÀ 09.01.2017 gÀAzÀÄ ZÉPï ¸ÀASÉå 692746 gÀÆ.1,49,600/- ªÉÆvÀÛPÉÌ ZÉPï£ÀÄß PÉÆmÉÖ JAzÀgÉ ¸Àj. ¸ÀzÀj ZÉPï £ÀUÀ¢ÃPÀgÀt DVzÉ JAzÀgÉ ¸Àj. G½zÀ ¨ÁQ ºÀtzÀ ¸ÀA§AzÀs £Á£ÀÄ zÀÆgÀÄzÁgÀjUÉ vÀ¯Á gÀÆ.1,00,000/- ªÉÆvÀÛPÉÌ 4 ZÉPïUÀ¼À£ÀÄß PÉÆnÖzÉÝÃ£É JAzÀgÉ ¸Àj. ........ F ¥ÀæPÀgÀtzÀ 4 ZÉPïUÀ¼ÀÄ 12 C.C.13918/2017 £À£ÀUÉ ¸ÀA§A¢¹zÀÄÝ JAzÀgÉ ¸Àj. CzÀgÀ°ègÀĪÀ ¸À»UÀ¼ÀÄ £À£ÀßzÉ JAzÀgÉ ¸Àj. CzÀgÀ°ègÀĪÀ §gÀªÀtôUÉ £À£ÀßzÉ JAzÀgÉ ¸ÁQÛ gÀÆ.1,00,000 JA§ÄzÀ£ÀÄß £À£Àß ªÀÄUÀ£À PÀqɬÄAzÀ §gɹzÉÝ£É, zÀÆgÀÄzÁgÀgÀ ºÉ¸ÀgÀÄ ªÀÄvÀÄÛ ¢£ÁAPÀªÀ£ÀÄß £Á£ÀÄ §gÉ¢®è JAzÀÄ ºÉüÀÄvÁÛgÉ. 4 ZÉPïUÀ¼À£ÀÄß £Á£ÀÄ zÀÆgÀÄzÁgÀjUÉ PÉÆnÖzÉÝ JAzÀgÉ ¸Àj. É É This evidence of accused makes it is crystal clear that, accused has admitted the issuance of disputed cheques to the complainant towards discharge of liability.
14. Further, the accused has taken specific contention that, he has repaid the entire amount by way of cash to the employees of complainant namely, Anil Kumar and Mohan. They have received the cash and obtained the signature of the accused in a book maintained by them. Complainant has not produced said book. If the said receipt book was produced before the court , it would clinches the point in issue. This line or argument is not acceptable, because it is unusual to believe that, the employees of the complainant have maintained the 13 C.C.13918/2017 book towards repayment made by the accused. Normally, payment receipts will be maintained by the purchaser to show the payments towards purchase of goods. Further, accused has not chosen to examine the employees of the complainant, who alleges to have received the amount from him. Except self serving testimony of accused, there is nothing on record to believe the payment of the money in cash by the accused to the complainant. As such, this contention of the accused that, complainant has misused the cheques issued by the accused on previous occasion. Moreover, the accused has not taken any legal action against the complainant towards alleged misuse of cheques.
15. From the overall consideration of the evidence on record that, it is abundantly clear that, accused has admitted the issuance of cheques and the signatures therein and he also admitted that the issuance of cheques towards payment of the purchase goods. Any how, he has taken defence of repayment of the amount to the hands of the employees of the complainant. Except taking contention, he has not placed any 14 C.C.13918/2017 cogent evidence to prove the same. Accused has also admitted the issuance of the cheques and also the signatures at Ex.P.1(a) to Ex.P.4(a). Such being the case, the presumption available under section 118 read with 139 of Negotiable Instrument Act that, the cheques were issued towards discharge of liability and the complainant is holder in due course of the cheques, could be drawn against the accused. Thus, the burden is on the accused to prove the contrary. Accused has not discharged that burden. Hence, case of complainant is acceptable.
16. One more point which merits the consideration of this court is, inspite of service of legal notice accused has not issued reply put forthing all these defences. Non issuance of reply is one of the strong circumstances against the accused.
16. It is pertinent to note that, accused has not taken probable defence to rebut the statutory presumption. Mere denial is not sufficient to discharge the onus shifted on accused. To fortify this opinion, it is proper to refer the decision reported 15 C.C.13918/2017 in, 2001 CRI.L.J. 4647, in a case of Hiten P.Dalal V/s. Bratindranath Banerjee, wherein it is held that;
"(B) Negotiable Instrument Act ( 26 of 1881), Ss.139, 138- Dishonour of cheque-
Presumption that cheque was drawn for discharge of liability of drawer- Is presumption of law- Ought to be raised by Court in every case- Rebuttal evidence- Nature- Mere plausible explanation is not sufficient- Proof of explanation is necessary.
Evidence Act (1 of 1872), Ss .114, 101-
104."
Further in another decision reported in, 2017(2) A.K.R. 527, Arjun Vs.E.Shekar, it is held that, S. 138, 139- Presentation of lawful consideration- Rebuttal of - Burden of proving that cheque has not been issued for any debt or liability - is on accused - mere plausible explanation not sufficient to disprove complainant' s case.
From the gist of the ratio laid down in the above decisions, it is clear that, burden shift on the accused to rebut the statutory presumption through cogent evidence, which is not discharged by the accused in the present case. 16 C.C.13918/2017
17. As for as proof of existence of legally enforceable debt is concerned, it is profitable to refer the decision of larger bench of the Hon'ble Apex Court reported in Rangappa Vs. Mohan reported in AIR 2010 SC 1898 = 2010 AIR (SCW) 2946, Wherein their lordships pleased to observe that, "In the light of these extracts, we are in agreement with the respondent-claimant that the presumption mandated by section 139 of the Act does indeed include the existence of the legally enforceable debt or liability".
In view of the law laid by three judges bench of Hon'ble Apex Court, the presumption enshrined under section 139 of the N.I. Act is extendable to the existence of legally enforceable debt. Accused has not placed cogent material to rebut the said presumption. As such, this contention of the accused holds no water.
18. In this case plea of the accused was recorded as per section 251 of Cr.P.C. Accused pleaded not guilty. As per section 251 of Cr.P.C. accused has to state about his defence. Here, except pleading not guilty accused has not stated his defence at 17 C.C.13918/2017 the time of recording plea. As per the decision reported in AIR 2014 SC 2528 (Indian Bank Association V/s Union of India), Crl. Petition No.8943/2010 M/s.Mess Transgare Pvt V/s Dr .R. Parvathareddy and in Rajesh Agarwals case, Wherein, it is held that; " Accused cannot simply say " I am innocent " or " I pleaded not guilty ". The proposition of law laid down in the aforesaid decision is squarely applicable to the facts and circumstances of this case. As such, it cannot be taken that accused has rebutted the presumption of law enshrined under section 139 and 118 of N.I. Act, by mere pleading not guilty.
19. From the discussion made supra, it is clear that, accused has neither taken probable defence nor taken steps to prove the same. The contention of the repayment of the amount covered under the cheques are also not proved through cogent and acceptable evidence. To put it other way, accused has not taken and proved probable defence to rebut the presumption of law available in favour of the complainant, envisaged under section 118 read with section 139 of N.I. Act. Accordingly, the case of 18 C.C.13918/2017 the complainant is believable. Hence, this point No.1 under consideration is answered in the affirmative.
20. POINT NO.2: In view of the reasons stated and discussed above, the complainant has proved the guilt of the accused punishable under section 138 of N.I. Act It is worth to note that, the offence is of the nature of civil wrong. Hence, it is proper to award sentence of fine, instead of awarding sentence of imprisonment. The Hon'ble Apex Court observed in the recent decision that, having regard to the length of trial and date of issuance of the cheque, it is necessary to award bank interest on the cheque amount. Considering all these aspects, this court proceed to pass the following;
ORDER
Acting under section 255 (2) of
Criminal Procedure Code, accused is
hereby convicted for the offence punishable under section 138 of Negotiable Instrument Act and sentenced to pay a fine of Rs.4,50,000/- (Four Lakh Fifty Thousand only). In default thereof 19 C.C.13918/2017 accused shall undergo simple imprisonment for 3 (Three) months.
Acting under section 357(1) (b) of code of criminal procedure, it is ordered that, Rs.4,40,000/- (Four Lakh Forty Thousand only), there from shall be paid to the complainant as a compensation, remaining fine amount of Rs.10,000/-
( Ten Thousand only) is defrayed to the
state for the expenses incurred in the
prosecution.
The bail bond of the accused stands
cancelled.
Office to supply the copy of this
Judgment to the accused immediately on
free of cost.
{Dictated to the stenographer, transcribed and computerized by her, corrected and then signed by me and then pronounced in the open court on this 4th day of April 2018}.
(KALPANA.M.S.) XX ACMM, Bengaluru.
20 C.C.13918/2017ANNEXURE List of witnesses examined on behalf of complainant:
P.W.1 M/s. Maruthi Traders,
A proprietorship firm,
Represented by its authorized
signatory,
Sri.Anil Kumar.S
List of documents produced on behalf of complainant:
Ex.P.1 to 4 Cheques Ex.P. 1(a) to 4(a) Signatures of the accused Ex.P. 5 to 8 Bank endorsements Ex.P. 9 Copy of the legal notice Ex.P. 10 & 11 Postal receipts Ex.P. 12 & 13 Postal acknowledgements Ex.P.14 Authorization letter Ex.P.15 Form VAT 7 Ex.P.16 IT Commercial tax receipt Ex.P.17 Form No.4 Ex.P.18 CST
List of witnesses examined on behalf of accused: 21 C.C.13918/2017
D.W.1 Sri.Indresh List of documents produced on behalf of accused:
Ex.D.1 Bank statement
XX A.C.M.M.,
Bengaluru.