Bangalore District Court
M/S Suri Industries vs M/S Sardar Transport & Travels. By on 30 January, 2015
IN THE COURT OF THE XX ADDITIONAL
CHIEF METROPOLITAN MAGISTRATE
BENGALURU CITY.
PRESENT: Smt. HIREMATH SHOBHARANI
BABAYYA
B.Com.LL.B.(Spl.)
XX ACMM, Bengaluru.
DATED: THIS THE 30th DAY OF JANUARY, 2015.
CRIMINAL CASE NO.28403/2003
Complainant : M/s Suri Industries,
No.91/6(2), Nagavarapalya
Main Road, Bangalore-560 093.
(Represented by Mr. R.K. Surendra Babu,
Proprietor).
(Represented: By Sri. S.M. Razvi-
Advocate, Bengaluru).
- Versus -
Accused 1. M/s Sardar Transport & Travels. By
Syed Kaleemullah,
Major,
Managing Partner,
M/s Sardar Transport & Travels,
No.2, Corporation Buildings,
Kalasipalyam,
Bangalore-560 002.
2. Syed Mohammed Madar, Major,
2 SCCH-24
CC-28403/2003
Partner,
M/s Sardar Transport & Travels,
No.2, EVR Road,
Opp. Central Railway Station,
Chennai-600003.
3. Syed Attaulla, Major,
Partner,
M/s Sardar Transport & Travels,
No.2, Corporation Buildings,
Kalasipalyam,
Bangalore-560 002.
(Represented By: Sri. Ganesh Bhat Y.H-
Advocate, Bengaluru).
Date of : 11.07.2003
commencement
of offence
Name of the : M/s Suri Industries,
complainant
Date of : 24.05.2005.
recording
evidence
Date of closing : 19.06.2014
evidence
Date of : 30.01.2015
Judgment
Offence : Under Sec.138 of the
complied of Negotiable Instruments Act.
Opinion of the : Accused No.1 to 3 are Acquitted.
Judge
3 SCCH-24
CC-28403/2003
XX ACMM,
Bengaluru.
4 SCCH-24
CC-28403/2003
JUDGEMENT
This case is arising out of the complaint filed by the complainant under Sec.200 of the Criminal Procedure Code for the offence punishable under Sec.138 of the Negotiable Instruments Act against the accused No.1 to 3 in PCR No.622/2003 to prosecute and punish the accused No.1 to 3 in accordance with law.
2. The brief facts relating to the case of the complainant are as under :
The complainant alleges that the complainant is an Industry engaged in the body building of buses and having its Registered Office and Factory. The Industry is represented by Mr. R.K. Surrendra Babu S/o R. Krishnaiah Chetty. The accused No.1 to 3 are the customers of the complainant since 5 years and they have business relations. They are fleet owners and operates the transport buses both from Bangalore and 5 SCCH-24 CC-28403/2003 Chennai ply all over India under the name and style of M/s Sardar Transport and Travels. Accused No.1 is the Managing Partner and whereas accused No.2 and 3 are partners and they have joint account in the bank, which they have been operating.
3. It is alleged that, the accused persons were intelligently managing the business affairs with complainant Industry and maintained cordial relations. They were closed friends of the complainant and had won the confidence of complainant. The accused No.1 to 3 represented the complainant that they intend to put buses to BMTC and KSRTC and need finance for developing their transport business and assured that the hand loan would be cleared within a year. They also assured that the chassis will be entrusted to complainant for body building. The proposal was about 50 buses. The complainant accordingly paid the hand loan to the accused No.1 to 3.
6 SCCH-24 CC-28403/2003
4. It is alleged that, the accused No.1 to 3 have jointly issued a cheque bearing No.428664 dated 18.12.2002 for a sum of Rs.3,90,000/- in favour of the complainant duly drawn on Vijaya Bank, Vani Vilas Road Branch, Bangalore, towards discharge of legally enforceable debt. The complainant has presented the said cheque through its banker for encashment i.e., State Bank of Mysore, NGEF Branch, Bangalore and the said cheque came to be returned dishonoured with shara "Insufficient Funds" and in this regard the bank has issued a memo dated 19.12.2002. Thereafter, the complainant caused legal notice dated 26.12.2002. The accused No.2 i.e., Syed Mohd. Madar received the registered notice. The accused No.1 to 3 evaded the notice and the RPAD covers returned. The RPAD notices were sent to accused No.1 both at Chennai and Bangalore Addresses. The notice sent to accused No.1 to 3 at refused written statement returned on 7 SCCH-24 CC-28403/2003 08.01.2003. The accused persons have neither replied the notices received under UPC nor paid the amount claimed thereby making themselves liable for this penal action.
5. It is contended that, the accused No.1 to 3 have taken the complainant for a ride and cheated him. They have betrayed the complainants confidence by indulging this kind of activity which is very unfortunate. The accused persons are very much engaged in the business and available at their business places but they have refused the notices by necessary implication and they may repeat the same method for the purposes of this court and a warrant of their arrest is prayed to see that they should not cause delay in process. The complaint is filed in time. Hence, the accused No.1 to 3 have committed an offence punishable under section 138 of Negotiable Instruments Act which is within the cognizance and jurisdiction of this Hon'ble court. The 8 SCCH-24 CC-28403/2003 cause of action arose on respective dates as indicated in the documents. For all these reasons, the complainant has filed this complaint against the accused No.1 to 3.
6. After filing of the complaint, cognizance of the offence was taken against the accused and sworn statement was recorded. As there was prima facie case, the case was registered as C.C.28403/2003 and proceeded against the accused.
7. After issuance of summons to the accused, the accused No.1 to 3 appeared before this Court and the order sheet reveals that the presence of the accused persons was secured and they are on bail.
8. Thereafter, the substance of the accusation was framed for the offence punishable under Sec.138 of the Negotiable Instruments Act and the same was read over and explained to the accused No.1 to 3. The 9 SCCH-24 CC-28403/2003 accused No. 1 to 3 pleaded not guilty and claimed to be tried.
9. In order to prove the guilt of the accused No.1 to 3, the complainant has examined two witness as PW1 and PW.2 and got marked Ex.P.1 to Ex.P.11 and Ex.P.15. Thereafter the complainant closed its side evidence.
10. After closure of the evidence of the complainant witnesses, statement of the accused persons is recorded under section 313 of Criminal Procedure Code. The accused No.1 to 3 have denied the allegations made against them. Thereafter the accused No.1 to 3 have chosen to adduce defence evidence on their behalf. Accused persons have examined two witnesses as DW-1 and DW-2 and Ex.D.1 and Ex.D.2 are marked. Thereafter defence side evidence closed.
10 SCCH-24 CC-28403/2003
11. Heard the arguments of the learned counsel for the complainant and the learned counsel for the accused persons. The learned counsel for the complainant has submitted the written arguments. Perused the materials placed on record.
12. Now the points that would arise for my consideration are as under:
1. Whether the complainant proves that the accused No. 1 to 3 are guilty of the offence punishable under Section 138 of the Negotiable Instruments Act ?
2. What order or sentence ?
13. My findings on the above points are as under:
Point No.1: In the Negative Point No.2: As per final order, for the following :
REASONS POINT No.1 :
11 SCCH-24 CC-28403/2003
14. The case of the complainant is that, the complainant has filed a complaint against the accused No.1 to 3 under section 138 of Negotiable Instruments Act, interalia contending that, the accused No.1 to 3 represented the complainant that they intended to put buses to BMTC and KSRTC and need finance for developing their transport business and assured that the hand loan would be cleared within a year. The complainant accordingly paid to the accused No.1 to 3 the hand loan. The accused No.1 to 3 jointly issued in favour of the complainant a cheque bearing No.428664 dated 18.12.2002 for a sum of Rs.3,90,000/- duly drawn on Vijaya Bank, Vani Vilas Road Branch, Bangalore, towards discharge of legally enforceable debt. The complainant presented the said cheque for encashment and the said cheque came to be returned with an endorsement "Insufficient Funds" on 19.12.2002. Thereafter, the complainant issued a legal notice to the 12 SCCH-24 CC-28403/2003 accused persons on 26.12.2002 informing the accused persons about the dishonour of the cheque. Though the accused persons received the said notice, but they have neither replied the notice nor have complied with the demand made therein.
15. During the trial, the defence of the accused No.1 to 3 was that they have not borrowed any hand loan from the complainant. The accused No.3 has not received the notice issued by the complainant. The proprietor / Owner of the complainant i.e., M/s Suri Industries is one R.S. Kumari and Sri. Surendra Babu is not the owner/proprietor of the complainant M/s Suri Industries. There is no financial transactions between complainant and M/s Sardar Transport & Travels. That one Prathima who is the daughter of R.S. Kumari and R.K. Surendra Babu and the said Prathima was working as accountant in their M/s Iqra Transport Pvt. Ltd., and 13 SCCH-24 CC-28403/2003 the said Prathima used to look after entire financial transaction. In case, if all three accused go out of station, they used to handed over the blank signed cheques to the said Prathima. The said Prathima has given the said cheques to the custody of her father and filed false complaint. According to the accused persons, they were not due any amount to the complainant for discharge of any legal liability.
16. Now coming to the legal aspect. Section 138 of Negotiable Instruments Act reads as under:
"138. Dishonour of cheque for insufficiency, etc., of finds in the account. - Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that 14 SCCH-24 CC-28403/2003 account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for a term which may extend to one year or with fine, which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply unless-
(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as the case may be makes a demand for the repayment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid ; and
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice."
15 SCCH-24 CC-28403/2003 Section 139 of the Negotiable Instruments Act reads as under:
"S.139- Presumption under S.118 when signature on cheque admitted by the accused - Further presumption under S.139 - Rebuttal of - As the signature in the cheque is admitted to be that of the accuse, the presumption envisaged in Section 118 of the Act can legally be inferred that the cheque was made or drawn for consideration on the date which the cheque bears - Section 139 of the Act enjoins on the Court to presume that the holder of the cheque received it for the discharge of any debt or liability. The burden was on the account of rebut the aforesaid presumption."
Section 118 of the Negotiable Instruments Act reads as under:
"118. Presumption as to negotiable instruments was made or drawn for consideration, and that every such instrument when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration; provided that, where the instrument has been obtained from its lawful owner, or from any person in lawful custody thereof, by means of an offence or fraud, or has been obtained from the maker or acceptor thereof by means of an
16 SCCH-24 CC-28403/2003 offence or fraud or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him."
In cheque bounce case, the court has to consider whether the ingredients of the offence enumerated in section 138 of the Negotiable Instruments Act have been made and if so, the accused is able to rebut the statutory presumption contemplated under section 139 of the Negotiable Instruments Act.
17. Now let me consider the evidence on record to find out as to whether the complainant has proved the existence of legally enforceable debt or liability so as to draw presumption under section 139 of the Negotiable Instruments Act.
18. PW-1 i.e, R.K. Surendra Babu has given evidence in this case. He reiterates the averments made in the complaint before this court. During the course of cross-examination he has deposed that, in the 17 SCCH-24 CC-28403/2003 complaint, in notice and in sworn statement and in evidence affidavit he has stated that he is the owner of the M/s Suri Industries. He admits that, he is not the owner of the M/s Suri Industries. He has deposed that he is the General Power of Attorney holder of the M/s Suri Industries. He has further deposed that his wife R.S. Kumari is the owner of the said Suri Industries. He has further deposed that his wife R.S. Kumari is the Income Tax Assessee. He has further deposed that :
"¸ÀÆj EAqÀ¹ÖçøïUÉ
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ºÁdgÀÄ¥Àr¸À®Ä AiÀiÁªÀÅzÉÃ
vÉÆAzÀgÉ EzÉAiÀiÁ JAzÀgÉ
¸ÁQë £ÀÄr¢gÀÄvÁgÉ. 10
ªÀµÀðUÀ¼À »AzÀ ¸ÀÆj
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18 SCCH-24
CC-28403/2003
He has further deposed that, he has two daughters namely Neema and Prathima. He has further deposed that only Suri Industries is the Income Tax assesse and not his wife. The evidence of PW-1 discloses that he is not the owner/proprietor of the M/s Suri Industries i.e,. Complainant and he has paid the hand loan to the accused persons. The wife of PW-1 i.e,. R.S. Kumari is the proprietor /owner of the complainant Suri Industries.
19. PW-2 is the Chief Manager of Vijaya Bank, Vanivilas Branch, Bangalore. PW-2 has deposed that, she has produced the statement of account ledger pertaining to the account No.1064 of Sardar Transport and Travels. She has deposed that as per entries mentioned in Ex.P.15, BS Cheque book No.428651 to 428675 has been given to the Sardar Transport and Travels. She has further deposed that the said account 19 SCCH-24 CC-28403/2003 No.1064 has been closed on 06.01.2004. She has further deposed that, as per rules and regulations the records relating to CA-1064-2004 has been destroyed, since the account has been closed in the year 2004.
20. In order to substantiate its case, the complainant has relied upon the documents produced at Ex.P.1 to Ex.P.11 and Ex.P.15. Out of these documents Ex.P.1 is the cheque, Ex.P.2 is the bank endorsement, Ex.P.3 is the copy of notice, Ex.P.4 to P.7 are the unserved postal covers, Ex.P.8 is the postal receipt, Ex.P.9 is the UCP, Ex.P.10 is the paper publication, Ex.P.11 is the General Power of Attorney and Ex.P.15 is the statement of account Ledger extract of the Sardar Transport and Travels. In order to rebut the evidence, accused No.3 has entered into the witness box and got himself examined as DW-1. He has deposed that earlier he is running Travel Agency.
20 SCCH-24 CC-28403/2003 He has deposed that he is running the agency in the name and style of Sardar Transport and the said Sardar Transport is situated at No.2, Corporation Building, Kalasipalya Main Road, Bangalore-02. He has further deposed that he has not received the any notices sent by the complainant. He has deposed that, the owner of the Suri Industries is R.S. Kumari and the said Surendra Babu is not the owner of the Suri Industries. He has further deposed that, there is no financial transactions between the Sardar Transports and Travels and Suri Industries. He has further deposed that, Prathima is the daughter of R.S. Kumari, and she was working as Accountant in their Iqra Transport Company. They used to give blank signed cheques to the custody of the Prathiba at the time of going out of station. He has further deposed that they have not given cheques to the Suri Industries. He has further deposed that Sardar Transport company has been closed in the year 2000 21 SCCH-24 CC-28403/2003 and Iqra Transport has been commenced from 25.04.2001. He has deposed that, on 11.12.2002 the Sardar Transport was not in existence. He has further deposed that, he has not taken any loan from Suri Industries for running BMTC and KSRTC buses and during that period the Iqra Transport company was existing. During the course of cross-examination he has denied suggestions that they used to get body building and repair of the buses in the Suri Industries and they used to park the vehicles in the complainant property. He has further deposed that during 2001 he has appointed the Prathima to their company. He has denied suggestion that, "£Á£ÀÄ ¸ÀÄgÉÃAzÀæ ¨Á§Ä CªÀgÀ ºÀwÛgÀ ¸ÉßûvÀ£ÁV ¸Á®ªÀ£ÀÄß ¥ÀqÉzÀÄPÉÆArgÀÄvÉÛÃ£É JAzÀgÉ ¸ÀjAiÀÄ®è. ¸ÀÆj EAqÀ¹ÖçÃ¸ï ªÀiÁ°ÃPÀgÁzÀ ¸ÀÄgÉÃAzÀæ¨Á§Ä CªÀgÀ ºÀwÛgÀ £Á£ÀÄ ¸Á® vÉUÉzÀÄPÉÆArgÀÄvÉÛÃ£É JAzÀgÉ 22 SCCH-24 CC-28403/2003 ¸ÀjAiÀÄ®è. ¸Á®ªÀ£ÀÄß £Á£ÀÄ ¸ÀÆj EAqÀ¹Öçøï¤AzÀ ¸ÀÄgÉÃAzÀæ ¨Á§Ä CªÀgÀ ªÀÄÆ®PÀ ¸Á®ªÀ£ÀÄß vÉUÉzÀÄPÉÆArgÀÄvÉÛÃ£É JAzÀgÉ ¸ÀjAiÀÄ®è. £À£ÀUÀÆ ºÁUÀÆ ¸ÀÄgÉÃAzÀæ ¨Á§Ä CªÀgÀ £ÀqÀÄªÉ ¸ÉßúÀ E¢ÝzÀÝjAzÀ CªÀgÀÄ £À£ÀUÉ ¸Á®ªÀ£ÀÄß £ÀUÀzÀÄ gÀÆ¥ÀzÀ°è PÉÆnÖgÀÄvÁÛgÉ JAzÀgÉ ¸ÀjAiÀÄ®è. ..............
£Á£ÀÄ §rØ ºÀtªÀ£ÀÄß PÉÆqÀ®Ä DUÀĪÀÅ¢®è JAzÀÄ ºÉýzÀÝPÉÌ CªÀgÀÄ §rØ ºÀtªÀ£ÀÄß ¦üPïì ªÀiÁr®è JAzÀgÉ ¸ÀjAiÀÄ®è.
He has further denied suggestion that :
¸ÀÄgÉÃAzÀæ ¨Á§Ä CªÀgÀ vÀAzÉ DAzÀæ ¥ÀæzÉñÀzÀ°è vÀÄA¨Á §¸ÀÄìUÀ¼À£ÀÄß ElÄÖPÉÆAqÀÄ mÁæ£ïì ¥ÉÆÃmïÀð PÀA¥À¤ £ÀqɸÀÄwÛzÀÄÝ CzÀjAzÀ §AzÀ ºÀtzÀ°è ¸ÀÄgÉÃAzÀæ ¨Á§ÄgÀªÀgÀÄ PÉýzÁUÀ CªÀjUÉ PÉÆlÖAvÀºÀ ºÀt ªÀÄ£ÉAiÀÄ°è ElÄÖPÉÆArzÀÄÝ CzÀ£ÀÄß £À£ÀUÉ PÉÆnÖgÀÄvÁÛgÉ JAzÀgÉ ¸ÀjAiÀÄ®è."
23 SCCH-24 CC-28403/2003
21. DW-2 i.e., Shyamala, Senior Manager of Sri Charan Souhardha Co.Operative Bank, Bangalore. She has deposed that earlier to 2002 she was working as Manager in the said Bank. She has deposed that Iqra Transport have got account in their Bank and the said account has been opened in the year 2001. She has deposed that as per Ex.P.8 the names of operators of the account is R.S. Prathima, Syed Kaleemulla, Syed Athaulla. S.N. and Mohammed Madar. H.P. She has further deposed that said Prathima was looking after the bank transactions. She has further deposed that she used to take the cheques on behalf of the company. In the cross examination she has deposed that Prathima was the operator of the said katha and she was customer of their Bank.
22. The evidence of DW-1 discloses that, the Sardar Transport company was closed in the year 2000 24 SCCH-24 CC-28403/2003 and Iqra Transport was commenced on 25.04.2001. The evidence of DW-2 discloses that, R.S. Prathima was the joint operator with Syed Kaleemualla, Syed Athaulla. S.N, and Mohammed Madar. H.P. of Iqra Transport Pvt. Limited.
23. The accused have produced documents at Ex.D.1 and Ex.D.2. Out of these documents, Ex.D.1 is the copy of the current Account extract of Iqra Transports Pvt Limited and Ex.D.2 is the Certificate on destroyal of old records.
24. The learned counsel for the complainant has submitted the written arguments. It is stated that in the written arguments that the complainant is represented by its GPA holder R.K. Surendra Babu, the complainant knows the accused No.1 to 3 and the said accused No.1 to 3 are customers since 7 years. The accused have got their transport under the name and style of M/s Sardar 25 SCCH-24 CC-28403/2003 Transport and Travels Pvt. Ltd. The accused persons are the partners of the M/s Sardar Transport and Travels Pvt., Ltd., and they have joint accounts and operating the same. The complainant paid the hand loan of Rs.3,90,000/- to the accused persons during October- 2001 by cash in the office of the Suri Industries and the accused persons have issued a post dated cheque bearing No.428664 on 18.12.2002 for a sum of Rs.3,90,000/- of Vijaya Bank, Vani Vilas Road, Bangalore towards discharge of hand loan a legally recoverable debt. The accused have admitted the issuance of cheque in favour of the complainant. Thus, the accused No.1 to 3 have committed the offence punishable under section 138 of Negotiable Instruments Act.
25. The learned counsel for the complainant has relied upon the decisions reported in 2012(5) Kar.L.J. 26 SCCH-24 CC-28403/2003 165 between Smt. Dhakshayani V/s Smt. Malathi Dayan. Wherein it is held that, "Negotiable Instruments Act, 1881, Section 138 - petitioner questioning the order of conviction passed by lower Court- On facts - Whether the Courts below are justified in holding petitioner guilty of an offence under Section 138 of the Act ? - Held - When petitioner does not dispute the fact of issuing cheques, presumption of the Court that cheque has been issued for a debt or liability having not been rebutted, Magistrate justified in recording finding of guilt- Neither any perversity nor illegality committed by Courts below- Hence petition dismissed."
26. The learned counsel for the complainant relied upon the decisions reported in 2013 (2) Kar.L.J. 569 between Smt. Peeranbi V/s Hajimalang. Wherein it is held that, "Negotiable Instruments Act, 1881, Section 138 and 139- Most dangerous provision - Double edged provision - Traders and citizens to be very careful - In dealing with cheques - Trial Court 27 SCCH-24 CC-28403/2003 committed error by comparing signature of accused - With that of signature on vakalath - Trial Court acquitted accused
- These proceedings were not in nature of a suit for recovery of money - Limited scope- Whether there was dishonour of cheque - Held, the aspect of dishonour of cheque established thus the accused is sentenced to pay a fine of Rs.3,50,000/- only thus appeal is allowed".
27. The learned counsel for the complainant has relied upon the decisions reported in AIR 2010 SC 1898, between Rangappa V/s Mohan, AIR 2010 CRL.L.J.2871 between Rangappa V/s Mohan and (2011) 1 SCC (Criminal) 184 Rangappa V/s Mohan. I have carefully gone through the above cited decisions, the principles laid down in the above cited decisions are not applicable to the present case on hand.
28. The learned counsel for the accused No.1 to 3 has argued that, the pleading concerned to the complainant, the R.K. Surendra Babu is claiming himself as a proprietor of the complainant. In the notice it is 28 SCCH-24 CC-28403/2003 stated that the Suri Industries represented by R.K. Surendra Babu. In the complaint cause title, it is recited that, the complainant is represented by its proprietor R.K. Surendra Babu. In the notice, sworn statement evidence affidavit declaring that, he is the proprietor of Suri Industries. In the cross-examination he has admitted that he is not the owner / proprietor of the Suri Industries and R.S.Kumari is the proprietor of the complainant Suri Industries. The complainant itself presented and proceeded is not maintainable. The complainant has filed fraud complaint and it is not maintainable.
29. The learned counsel for the accused persons has further argued that the complainant has filed the application to change the name of the proprietor the same is dismissed before the Hon'ble High Court of Karnataka the appeal has been dismissed as withdrawn 29 SCCH-24 CC-28403/2003 by the complainant. The said R.S. Kumari has not appeared before this court till date and no documents to produce before the court to show that she is unable to attend the case.
30. The learned counsel for the accused persons have argued that, in Ex.D.1 it is clear that, under what circumstances the cheque has gone to the custody of the complainant. In Ex.D.1 the account operators name is shown as Prathima. R.S and Accused No.1 to 3. Ex.D.1 is the account pertain to the company belongs to the accused persons. Complainant has not produced any documents pertaining to the complainant except legal notice and complaint. The complainant has not discharged the rebuttal presumption and not established the complaint averments. Cheque amount of Rs.3,90,000/- and it is need to be supported by Income Tax returns. The cheque in question has not 30 SCCH-24 CC-28403/2003 been towards discharge of debt. But it is misused. The complainant is not consistent with regard to the transactions. In the complaint and notice it is claming that financial transactions between the Suri Industries and accused persons. According to the complainant loan is lent by the Suri Industries and avoided by the accused persons. The complainant has failed to establish the legal enforceable debt.
31. The learned counsel for the accused has relied upon the decisions reported in 2014 CRI. L.J.2304 between John. K. Abraham V/s Simon C. Abraham and another. Wherein it is held that;
"Negotiable Instruments Act (26 of 1881) Ss.138, 118, 139 - Dishonour of cheque - Complainant alleging that accused borrowed a sum of Rs.1,50,000/- from him and issued a cheque for said sum which was dishonoured - For drawing presumption under S.118 r.w.S.139 burden is heavily upon complainant- Complainant not sure as to who wrote cheque nor aware 31 SCCH-24 CC-28403/2003 as to when and where existing transaction took place for which cheque was issued by accused- Defects in evidence of compliant as noted by trial court brushed aside by High Court without assigning any valid reason-
Conviction of accused therefore, not proper"
32. The learned counsel for the accused relied upon the decisions reported in (2006) 3 Supreme Court Cases (Cri)30 between M.S. Narayana Menon Alias Mani V/s State of Kerala and Another. Wherein it is held that;
"D. Evidence Act, 1872, Ss.114 III.(g) & 34 - Withholding of relevant evidence- Adverse inference- Dishonour of cheque, which was issued to a share broker (complainant)- Allegation of complainant that cheque was issued to clear debt in relation to share transactions- Complainant not producing before court his statutory books of accounts in respect of said transactions- In this view, held, adverse inferences could be drawn against him- Negotiable Instruments Act, 1881, Ss.138, 118(a) & 139"
32 SCCH-24 CC-28403/2003
33. The learned counsel for the accused relied upon the decisions reported in 2007 AIR SCW 6736 between John K. John V/s Tom Varghese and another. Wherein it is held that;
"Negotiable Instruments Act (26 of 1881) Ss.138, 139 - Dishonour of cheque - Discharge of debt- Rebuttal of presumption under S.139 - Court can take notice of conduct of parties-
Respondent alleged to have borrowed huge sum from appellant - Complainant despite suits for recovery of defaulted amount filed against him by appellant - No document executed - Amount advanced carrying no interest - Finding of fact by High Court that respondent did not issue cheques in discharge of any debt and discharged burden of proof cast on him under S.139- Being not perverse cannot be interfered with under Art.136."
34. The learned counsel for the accused relied upon the decisions reported in ILR 2008 KAR 4629 between Shiva Murthy V/s Amruthraj. Wherein it is held that;
33 SCCH-24 CC-28403/2003 "Negotiable Instruments Act, 1881 - Section 138 offence under - Complaint - Conviction and Sentence - Confirmed in Appeal- Revision against - Production of additional documents before the Appellate Court- Non-consideration of - Existence of legally enforceable debt- Failure of the complainant to prove - Presumption drawn merely on the basis of the conduct of the accused - Legality of - HELD, The courts below more particularly, the Appellate Court before whom the additional documents were produced has not directed itself in this regard to find out as to whether the complainant has proved the existence of legally enforceable debt. Both the Trial Court and the Appellate Court have mainly proceeded to consider the conduct of the accused. Before considering the conduct of the accused to find out as to whether or not he has been able to rebut the Statutory Presumption available under Section 139, the Courts ought to have considered as to whether the complainant has proved the existence of legally enforceable debt. It is only after satisfying that the complainant has proved existence of legally enforceable debt or liability, the Courts could have proceeded to draw presumption under Section 139 of N.I. Act and thereafter find out as to whether or not the accused has 34 SCCH-24 CC-28403/2003 rebutted the said presumption. -
Judgment of conviction and sentence are liable to be set-aside- Accused is acquitted"
35. The learned counsel for the accused relied upon the decisions reported in ILR 2009 KAR 1633 (SUPREME COURT) between Kumar Exports V/s Sharma Carpets. Wherein it is held that;
"(A) Negotiable Instruments Act 1881- Sections 139 and 138 -
Presumption that cheque was issued in discharge of debt or liability - Presumption how to be displaced -
Declaration made by the complainant himself to the Sales Tax Department that no sale had taken place - Accepted as a valid proof that cheques were not issued by accused in discharge of any debt or liability to complainant - Accused therefore by producing this evidence, held to have displaced the presumption under Section 139 and therefore offence under section 138 not proved against accused"
35 SCCH-24 CC-28403/2003 I have carefully gone through the above cited decisions, the principles laid down in the above cited decisions are applicable to the case on hand.
36. On careful perusal of oral and documentary evidence so placed on record by the complainant and the accused persons, it reveals that, the cheque relates to the account of the Sardar Transport and Travels and the signature on the said cheque is not disputed by the accused persons. Once the cheque relates to the account of the accused and they accept and admits the signatures on the said cheque, then the initial presumption as contemplated U/s 139 of the Negotiable Instruments Act has to be raised by the Court in favour of the complainant. The presumption referred to in Section 139 of the Negotiable Instruments Act is a mandatory presumption and not a general presumption, but the accused is entitled to rebut the
36 SCCH-24 CC-28403/2003 said presumption. The defence raised by way of rebuttal evidence must be probable and capable of being accepted by the Court.
37. According to the complaint averments, that one R.K. Surendra Babu is said to be the proprietor of the complainant. PW-1 himself is the R.K. Surendra Babu. The evidence of PW-1 discloses that he is not the proprietor/owner of the complainant. It is the evidence of PW-1 that he is the General Power Attorney holder of the complainant. The complainant has not produced any documents to show that R.S. Kumari is the owner / proprietor of the said Suri Industries and it is running the business of body building of buses. Ex.P.11 is the General Power of Attorney, it discloses that PW-1 is the General Power of Attorney holder of R.S. Kumari. It is pertinent to note that, the cause title of the complaint and the complainant is represented by R.K.Surendra 37 SCCH-24 CC-28403/2003 Babu as proprietor of the complainant and the said complaint is signed by R.K. Surendra Babu under the capacity of the proprietor of the complainant and there is no averment in the complainant that the said R.K.Surendra Babu is the GPA holder of the complainant. Thus, the complaint is not properly framed and presented before the court.
38. Secondly, it is the case of the complainant that, accused No.1 to 3 have borrowed a hand loan from the complainant. The present complaint has been filed against the accused No.1 to 3 in their individual names. As per Ex.P.1, cheque in question has been issued by the Managing partner and two partners of the Sardar Transport and Travels. PW-2 has clearly stated in her evidence that, as per Ex.P.15 the cheque book No.428651 to 428675 has been given to the Sardar Transport & Travels. But the complaint has been filed 38 SCCH-24 CC-28403/2003 against the accused No.1 to 3 their individual names and the complaint has not been filed against the Sardar Transport and Travels. Thus, the complaint has not been filed against the proper person. Therefore, the said complaint is not maintainable against the accused No.1 to 3.
39. It is pertinent to note that, the complaint averments disclose that the complainant has paid hand loan to the accused No.1 to 3. The complaint averments is silent with regard to the how much amount paid, date of payment and mode of payment i.e., whether the hand loan is paid in cash or cheque or Demand Draft. Ex.P.3 is the legal notice issued by the complainant to the accused No.1 to 3 on 23.12.2012. Ex.P.3 discloses that, notice has been issued to the accused No.1 to 3 and not to the Sardar Transport and Travels represented by its Managing Partner and 39 SCCH-24 CC-28403/2003 partners as the cheque belongs to the Sardar Transport and Travels account. The recitals of the Ex.P.1 does not discloses that the what is the amount paid in hand loan, date and place etc. In the notice as well as in the complaint there is only bald allegations that the accused No.1 to 3 have jointly issued the cheque in favour of the complainant towards discharge of legal enforceable debt. But, the said cheque in question does not belongs to the account of the Accused No.1 to 3, it is belongs to Sardar Transport and Travels. PW-1 in his evidence has deposed that, he has paid the hand loan of Rs.3,90,000/- to the accused No.1 to 3 during October-2011 by cash, in his office. The accused persons issued a post dated cheque bearing No.428664 dated 18.12.2002 for a sum of Rs.3,90,000/- towards the discharge of the hand loan a legally recoverable debt. The evidence of PW-1 appears to be improvements and in the absence of the pleadings the 40 SCCH-24 CC-28403/2003 evidence of PW.1 cannot be accepted. Except the self serving testimony of PW-1, there are no documentary evidence to show that the Suri Industries has lent money to the accused No.1 to 3 or to the Sardar Transports and Travels. It is not the case of the complainant that it has lent money to the Sardar Transports and Travels. How the complainant could lend the amount of Rs.3,90,000/- to the accused No.1 to 3 is not explained.
40. It is pertinent to note that, cheque is issued for Rs.3,90,000/-. If, a substantial amount has been lent in the usual course of business transactions, it is reasonable to presume to that there would be an agreement or document for payment of money so also the interest. In the present case, the complainant has not produced any documents to show that its source of income so as to enable it to advance a huge loan. Thus 41 SCCH-24 CC-28403/2003 non-production of book of accounts; absence of proof to show that the complainant got so much money, from the business; absence of any written document evidencing lending of money, absence of any witness to the transaction; non compliance of provisions of Section 269 SS of Income Tax Act which directs that any advance taken by way of any loan of more than Rs.20,000/- should be made only by way of an Account Payee cheque. In the absence of the documents an adverse inference can be drawn against the complainant.
41. According to the case of the complainant that the accused No.1 to 3 have jointly issued the post dated cheque in question on 18.12.2002. It is not the case of the complainant that on the same of availing the alleged loan the accused No.1 to 3 have initially issued the cheque in favour of the complainant.
42 SCCH-24 CC-28403/2003 Admittedly, the cheque bears the date as 18.12.2002. Therefore, as per clause (b) of Section 118 of the Negotiable Instruments Act it has to be prescribed that the cheque was drawn on 18.12.2002. Admittedly, no consideration was paid by the complainant to the accused No.1 to 3 on 18.12.2002. In view of this, the statutory presumption under Section 118(a) of the Negotiable Instruments Act stated rebutted. Even according to the complainant there is no documentary evidence to prove lending of money of Rs.3,90,000/- to the accused No.1 to 3 and the accused No.1 to 3 have not executed any document evidencing the receipt of money as loan. Apart from the oral evidence, the complainant has not placed any other evidence to prove the existence of legally enforceable debt or liability. The complainant has not produced any documents to show about the financial consideration of the complainant. How it could lend the money of 43 SCCH-24 CC-28403/2003 Rs.3,90,000/- to the accused No.1 to 3 is not explained. Therefore, an adverse inference can be drawn against the complainant that the complainant was not in a position to lend Rs.3,90,000/- to the accused persons. In the light of the discussions, made above, I hold that the complainant has utterly failed to prove the existence of legally enforceable debt against the accused persons. Therefore, the question of commission of an offence punishable under Section 138 of the Negotiable Instruments Act does not arise. So also, the complaint has been filed by the complainant against the accused No.1 to 3 in their individual names, but cheque is issued by the Managing Partner/ partners of Sardar Transport and Travels and accused persons have signed the cheque under the capacity of Managing Partner / Partners of said Sardar Transport and Travels and not in their individual names/capacity.
44 SCCH-24 CC-28403/2003 Looking from any angle the complaint is not maintainable.
42. The defence of the accused No.1 to 3 that, the daughter of the R.K. Surendra Babu, i.e, Prathima was working in their company and she was looking after entire financial transactions of their company. In this regard, DW-2 has produced the Ex.D.1 the account extract of the Iqra Transport Pvt. Ltd., In Ex.D.1 the name of Prathima is shown as one of the operator. Thus, the blank signed cheques of the company is used to given to the Prathima for business purposes and she has mis used the said cheque and given to her father appears to be more probable than the case of the company. On these grounds the complainant has failed to prove the allegation made against the accused No.1 to 3 that the accused No.1 to 3 have committed an offence punishable under section 138 of the Negotiable 45 SCCH-24 CC-28403/2003 Instruments Act. Accordingly, point No.1 is answered in the Negative.
Point No.2 :
43. For the foregoing reasons and discussion as stated above, the accused No.1 to 3 are entitled for acquittal.
In result, I proceed to pass the following:
ORDER Acting U/s 255 (1) of Cr.P.C the Accused No.1, Accused No.2 and Accused No.3 are acquitted for the offence punishable under Sec.138 of the Negotiable Instruments Act. Their bail bond stands cancelled. They are set at liberty.
(Dictated to the stenographer on online, transcribed by him corrected by me and then pronounced in open court on this the 30th day of January, 2015).
(HIREMATH SHOBHARANI BABAYYA) XX ACCM Bengaluru.
ANNEXURE
46 SCCH-24 CC-28403/2003 LIST OF WITNESSES EXAMINED FOR PROSECUTION PW.1 : Sri. R.K. Surendra Babu.
PW.2 : Smt. S. Sunitha.
LIST OF WITNESSES EXAMINED FOR DEFENCE.
DW.1 : Sri. Syed Athaulla
D.W.2 : Smt. Shyamala.
LIST OF DOCUMENTS MARKED FOR PROSECUTION Ex.P.1 : Cheque.
Ex.P.1(a) : Signature of Accused No.3
Ex.P.2 : Bank endorsement.
Ex.P.3 : Copy of Legal Notice.
Ex.P.4 to 7 : Unserved postal covers.
Ex.P.8 : Postal receipt.
Ex.P.9 : UCP.
Ex.P.10 : Paper publication.
Ex.P.11 : Copy of GPA.
Ex.P.15 : Statement of account ledger
extract.
LIST OF DOCUMENTS MARKED FOR DEFENCE. Ex.D1 : Current Account Pass sheet. Ex.D2 : Letter dated 17.06.2014 XX Addl.C.M.M, BENGALURU.
47 SCCH-24 CC-28403/2003 30.01.2015 Comp: SMR Accused: GBYH Judgment pronounced in open court (Vide separate Judgment) ORDER Acting U/s 255 (1) of Cr.P.C the Accused No.1, Accused No.2 and Accused No.3 are acquitted for the offence punishable under Sec.138 of the Negotiable Instruments Act. Their bail bond stands cancelled. They are set at liberty.
48 SCCH-24 CC-28403/2003 XX Addl. C.M.M., B'lore.
49 SCCH-24 CC-28403/2003 30.01.2015 Comp: SMR Accused: GBYH Judgment pronounced in open court (Vide separate Judgment) ORDER Acting U/s 255 (1) of Cr.P.C the Accused is acquitted for the offence punishable under Sec.138 of the Negotiable Instruments Act.
His bond stands cancelled.
He set at liberty.
XX Addl. C.M.M., B'lore.