Bangalore District Court
M/S. Sivam Electrical And Hardware ... vs 1. M/S. Reeliable Mep Projects India 2. ... on 3 May, 2025
1
C.C.No. 18927/2018
KABC030510952018
Presented on : 11-07-2018
Registered on : 11-07-2018
Decided on : 03-05-2025
Duration : 6 years, 9 months, 23 days
IN THE COURT OF THE XXII ADDL.CHIEF JUDICIAL
MAGISTRATE, BENGALURU
PRESENT : SRI.JAI SHANKAR.J,
B.A.L., LL.B
XXII ADDL.C.J.M., BENGALURU.
DATED: THIS THE 3RD DAY OF MAY 2025
JUDGMENT U/s.278(2) of BNSS -2023
(Old Correspondence No. 255(2), of Cr.P.C)
C.C.NO. : 18927/2018
COMPLAINANT : M/s. SIVAM ELECTRICAL &
HARDWARE,
No.638, 1st Main Road,
N.G.O.S Colony, Kamalanagar,
Bengaluru -0 560 079.
Rept by its Proprietor Mr. Ashok Ram
(By Sri. K. Ramakrishnaiah., Adv.,)
V/S.
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C.C.No. 18927/2018
ACCUSED : 1. M/s. Reeliable Mep Projects
India Pvt Ltd.,
# 881, II Stage, Dr. Modi Road,
WRC, Mahalakshmipuram,
Bengaluru - 560 086.
Rept by its Authorized Signatory/ies
Mr. Rohith Reddy &
Mr. B.T. Srinivas Gowda,
2. Mr. Rohith Reddy,
Father Name not known,
Major,
Rept by Authorized Signatory of
M/s. Reeliable Mep Projects India Pvt
Ltd., # 881, II Stage, Dr. Modi Road,
WRC, Mahalakshmipuram,
Bengaluru - 560 086.
3. Mr. B.T. Srinivas Gowda,
Father Name not known,
Major,
Rept by Authorized Signatory of
M/s. Reeliable Mep Projects India Pvt
Ltd., # 881, II Stage, Dr. Modi Road,
WRC, Mahalakshmipuram,
Bengaluru - 560 086.
(By Sri. Manjunatha. D.L., Adv.,)
Offence complained : U/s.138 of N.I.Act
of
Plea of the Accused : Pleaded not guilty
Final Order : Accused is convicted
Date of order : 03.05.2025
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C.C.No. 18927/2018
JUDGMENT
This is a private complaint filed by the complainant firm against the accused firm rept by its authorized signatories the accused no.2 & 3 for the offence punishable under Section 138 of Negotiable Instruments Act.
2. The brief facts of the complainant's case is as under:
It is contended that, the complainant is the wholesale dealer of electrical and hardware items. The accused no.1 firm was the regular customer and the complainant had supplied electrical items to the accused no.1 firm under invoices. The accused no.1 firm was maintaining a running current account with the complainant and as per the accounts statement, the accused no.1 firm was due of Rs.13,82,188/-. Towards the discharge of the said payment, the accused no.1 firm rept by its authorized signatories ie., accused no.2 & 3 have issued the cheque bearing no.000026, dt:16.02.2018 for Rs.6,91,094/- and cheque 4 C.C.No. 18927/2018 bearing No. 000027, dt: 14.02.2018 for Rs.6,91,094/-, both drawn on Equitas Small Finance Bank, Basaveshwara- nagara Branch, Bengaluru, assuring that, on presentation it would be honored. When the complainant presented the cheques for encashment through his banker ie, Punjab and Maharastra Co-operative Bank Ltd., Bengaluru, the same came to be dishonored with shara as "Funds Insufficient" vide endorsements dt: 17.02.2018. On bringing the said fact to the knowledge of the accused no.1 firm, they requested to present it again in the first week of April 2018. On such assurance, when the complainant presented the cheques through his banker, again it got dishonored with the shara as "DR not allowed" vide memo dt: 27.04.2018. Immediately, the complainant got issued the legal notice dt:24.05.2018 through RPAD, which was served, but the accused no.1 firm has not chosen to comply the demand, which has given cause of action to file the present complaint.5
C.C.No. 18927/2018
3. After filing of the complaint, this court has taken cognizance of the offence punishable U/s.138 of N.I.Act. Sworn statement of the complainant is being recorded. Being satisfied that, there are prima-facie materials to proceed against accused persons, summons were issued. After appearance of the accused no.2 & 3, they were enlarged on bail and plea was recorded. The accused no.2 & 3 have not pleaded guilty, but submitted that, they would go for the trial.
4. From the basis of the pleadings, the following points that arise for my consideration are as follows:-
1. Whether the complainant proves that, the accused no.1 firm rept by its authorized signatories the accused no.2 & 3 have issued cheque bearing no.000026, dt: 16.02.2018 for Rs.6,91,094/- and cheque bearing no.
000027, dt: 14.02.2018 for Rs.6,91,094/-, both drawn on Equitas Small Finance Bank, Basaveshwaranagara Branch, Bengaluru, towards discharge of their liability which was returned unpaid on presentation for the reason "DR not allowed" 6
C.C.No. 18927/2018 and despite of knowledge of the notice, they have not paid the said cheque amounts and thereby, committed an offence punishable U/s.138 of N.I.Act?
2. What order?
5. The sworn statement and the documents marked at Ex.P.1 to P.11(b) of the complainant is being treated as the complainant evidence as per the decision of the Hon'ble Apex Court in Indian Bank Association Vs. Union of India and Ors., reported in 2010 (5) SCC 590. The statement of the accused no.2 & 3 as required U/s.313 of Cr.P.C. were read over and explained to them, they denied the incriminating evidence appeared against them and submitted that, they have the evidence, but however they have neither chosen to adduce their evidence nor chosen to complete the cross-examination of the complainant. Thereby the further cross examination of the complainant is being taken as nil and so also the defence evidence. 7
C.C.No. 18927/2018
6. Heard from the complainant side. Defence not chosen to address the argument. Perused the materials available on record.
7. My answer to the aforesaid points are as under:-
Point No.1 :- In the Affirmative Point No.2 :- As per the final order, for the following:-
REASONS
8. Point No.1:- The complainant firm rept by its proprietor has filed this complaint alleging that, the accused no.1 firm rept by its authorized signatory have purchased the electrical items on the credit basis and having due for accused sum of Rs.13,85,188/-, they have issued the disputed cheques at Ex.P.3 & 4 which are been dishonored for want of sufficient funds as per Ex.P.9 & 10. The complainant has also emphasized on the demand notice at Ex.P.11 and it being served on the accused no.1 firm and it not replying the demand notice. Thereby, he claims that, he has established his case and he is entitled 8 C.C.No. 18927/2018 to claim presumption. However, the accused no.1 firm rept. by its authorized signatories ie., accused no.2 & 3 though had appeared through the counsel, but they have not chosen to rebut the presumption or chosen to establish their defence so as to disbelieve the complainant case.
9. The deposition of the complainant would go to indicate that, the accused no.2 & 3 as a authorized signatory of the accused no.1 firm have cross examined the PW.1 in part. Perhaps, by gathering the defence of the accused persons in the part cross examination, it indicates that, they have questioned the supply of materials and also, contend that, the disputed cheques were being issued towards the security purpose while supplying the materials and so also, claim that, no demand notice was being issued independently on them. Though, the accused persons have taken these defence, but they have not placed any probable evidence to appreciate the said defence. Perhaps, the very defence indicates that, they have purchased the electrical 9 C.C.No. 18927/2018 items from the complainant which cannot be disputed. The Ex.P.1 & 2 the tax invoices would also go to indicate the complainant supplying the electrical items to the accused firm. Though, the accused persons have questioned the complainant with regard to the purchase order and also, the statements to show the balance amount to be due, but again, the accused persons not effectively and completely cross examining the complainant itself indicates that, the said defence would not go to the root of the case. Because, the disputed cheques at Ex.P.3 & 4 does belongs to the accused no.1 firm and they being the authorized signatories have singed it which is not being disputed. When, they are so particular that, the disputed cheques were being issued towards the security purpose, they ought to have produced some document in writing. Infact, the demand notice is also being served on the accused firm and not replying at the initial stage itself indicates that, the case put forth by the defence is not acceptable. No doubt, the 10 C.C.No. 18927/2018 accused no.2 & 3 have questioned of no demand notice being issued to them in the individual capacity, but it is also an admitted fact that they are the authorized signatory of the firm who would be aware of the dishonour of the cheques and the service of the demand notice. When the demand notice was being served on the accused firm, they ought to have replied it, which admittedly not forthcoming. Nowhere, the accused persons have denied the receipt of the demand notice by the firm.
10. In the decision reported in 2019 SCC OnLine Kar.2117- V.R.Shresti Vs., Bhaskar.P., wherein the Hon'ble High court has opined that, if really the accused had no transaction with the complainant, he would have given reply to the notice and not replying the same would go to establish that, the defence made is false and the court should draw the presumption against the accused for not replying the legal notice. The decision aptly applies to the case in hand. Not replying the notice at the initial stage 11 C.C.No. 18927/2018 would hold no water so far the defence case is concerned and in this background, the case of the complainant has to be accepted by drawing presumption. In the decision reported in (2021) 5 SCC 283 - Kalamani Tex and Another., Vs. P.Balasubramanian, (2010) 11 SCC 441- Rangappa Vs. Sri.Mohan., wherein it is held that, when once the signature of an accused on the cheque is established, than the reverse onus clauses become operative, also aptly applies to the case in hand. When the complainant has established the accused persons having issued the cheques at Ex.P.3 & P4 towards the discharge of legal liability and their existed a legally enforceable liability, the onus to disprove it, shifts on the accused which is not been proved by placing positive evidence. In this background, having the accused persons not disputed the complainant case by placing positive evidence, I am of the considered view that, the cheques issued by the accused persons at Ex.P.3 & P4 is for the legally enforceable liability 12 C.C.No. 18927/2018 and this fact is being established by the complainant by placing cogent and positive evidence which is not rebutted by the other side.
11. It is need less to say that, documentary evidence do prevail on the oral evidence. Absolutely, there is no evidence available on record, to hold that, the disputed cheques were being issued towards the security purpose. So, in this back ground when the provisions U/s.118 and 139 of N.I. Act is looked into, it raises the presumption in favour of the holder of the cheque that, he has received the same for discharge in whole or in part of any debt or other liability. It also permits the complainant to fill the cheques having established the Ex.P.3 & P4 being issued towards the discharge of loan liability. As said above, the accused persons have not disputed the cheques and the signatures appearing therein does pertains to them. It could be said that, the accused persons have not disputed the cheques in question and signatures found therein. When the drawer 13 C.C.No. 18927/2018 has admitted the issuance of cheque as well as the signature present therein, the presumption envisaged U/s.118 R/w.139 of N.I.Act would operate infavour of the complainant. The said provisions lies on a special rule of evidence applicable to negotiable instruments. The presumption is one of law and thereunder the court shall presume that, the instrument was endorsed for consideration. So also, in the absence of contrary evidence on behalf of the accused persons, the presumption U/s.118 of N.I.Act goes in favour of the complainant. No doubt, as said statutory presumptions are rebuttable in nature, but when the complainant has relied upon the statutory presumptions enshrined U/s.118 R/w.Sec.139 of N.I.Act, it is for the accused persons to rebut the presumption with cogent and convincing evidence.
12. It is worth to note that, Sec.106 of Indian Evidence Act postulates that, the burden is on the accused to establish the fact which is especially within its knowledge. 14
C.C.No. 18927/2018 This provision is exception to the general rule that, the burden of proof is always on the prosecution to establish its case beyond all reasonable doubt. In that view of matter, the burden is on the accused to prove that, the cheque in question was not issued for discharge of any liability. But, despite the accused persons have taken the defence that, the Ex.P.3 & P4 were not issued towards the legal liability to the complainant, but the said fact and the version is not been established. From the discussion made supra, it could be said that, the complainant has established his case by placing positive evidence. On the other hand, the accused persons failed to establish their defence by placing probable defence and also, failed to elicit the said fact from the mouth of the PW.1. In this back ground, the case of the complainant requires to be accepted. The evidence placed on record establishes that, the complainant has proved that, for discharge of the legal liability, the accused persons have issued Ex.P.3 & P4 and it is being dishonored as per 15 C.C.No. 18927/2018 Ex.P.9 & 10. Therefore, Point No.1 is answered in the "Affirmative'.
13. Point No.2:- For the reasons discussed in the point No.1, the complainant has proved the guilt of the accused punishable U/s.138 of N.I.Act. The Hon'ble Apex Court also dealt in the decision reported in (2018) 1 SCC 560, M/s. Meters and Instrument Pvt. Ltd., Vs. Kanchana Mehta., wherein It is held that "the object of provision being primarily compensatory, punitive element being mainly with the object of enforcing the compensatory element, compounding at the initial stage has to be encouraged, but is not debarred at the later stage subject to appropriate compensation has may be found acceptable to the parties or the court". By considering the decision, it could be said that, the time when the transaction has taken place and the primary object of the provision being kept in mind, I am of the considered view that rather imposing punitive sentence, if sentence of fine is imposed with a direction to 16 C.C.No. 18927/2018 compensate the complainant for its monetary loss by awarding compensation U/s.396 of BNSS 2023, it would meet the ends of justice. By considering these aspects, I am of the considered view that, it would be just and proper to impose fine of Rs.13,87,188/-. Out of the compensation of Rs.13,87,188/-, an amount of Rs.13,82,188/- shall be awarded to the complainant U/s.396 of BNSS 2023. Accordingly, I proceed to pass the following :.
ORDER
Acting U/s.278(2) of BNSS -2023
(Old Correspondence No. 255(2) of Code of Criminal Procedure), the accused no.1 firm rept by its authorized signatories ie., the accused no.2 & 3 are convicted for the offence punishable under section 138 of the Negotiable Instruments Act, the accused is sentenced to pay fine of Rs.13,87,188/-
(Rupees Thirteen Lakhs Eighty Seven Thousand One Hundred and Eighty Eight only) In default thereof, the accused no.2 & 3 shall undergo simple imprisonment for the term of one year.
Acting U/s. 396 of BNSS - 2023 (Old Correspondence No. 357(1)(b) of Cr.P.C), it is 17 C.C.No. 18927/2018 ordered that, Rs.13,82,188/- (Rupees Thirteen Lakhs Eighty Two Thousand One Hundred and Eighty Eight only) , there from shall be paid to the complainant trust as compensation. The remaining fine amount of Rs.5,000/- (Rupees Five Thousand only) is defrayed to the state for the expenses incurred in the prosecution.
The office is to furnish the free copy of this Judgment to the accused no.2 & 3 forthwith. [[ (Directly dictated to stenographer on computer, typed by her, revised by me and then pronounced by me in the open court on this the 3rd day of May 2025).
JAI Digitally signed by
JAI SHANKAR J
SHANKAR Date: 2025.05.03
J 16:30:59 +0530
(JAI SHANKAR.J)
XXII Addl. Chief Judicial Magistrate, Bengaluru.
ANNEXURE List of witnesses examined on behalf of complainant:-
PW.1 : Sri. Ashok Ram List of exhibits marked on behalf of complainant:-
Ex.P1 & P2 : Tax Invoices
Ex.P3 & P4 : Original cheques
Ex.P3(a) & P4(a) : Signatures of the accused No.2
Ex.P3(b) & 4(b) : Signatures of the accused No.3
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C.C.No. 18927/2018
Ex.P5 & P6 : Bank Challans
Ex.P7 to 10 : Bank Memos
Ex.P11 : Legal notice
Ex.P11(a) : Postal receipt
Ex.P11(b) : Postal acknowledgment
List of witnesses examined on behalf of the accused:-
- Nil-
List of exhibits marked on behalf of the accused:-
- Nil-Digitally signed
JAI by JAI SHANKAR
SHANKAR J
Date: 2025.05.03
J 16:31:04 +0530
(JAI SHANKAR.J)
XXII Addl. Chief Judicial Magistrate, Bengaluru. 19 C.C.No. 18927/2018