Bangalore District Court
Intelligent Retail Pvt Ltd vs Irfan on 2 December, 2025
0
C.C.NO.20853/2024
KABC030363302024
Presented on : 29-06-2024
Registered on : 29-06-2024
Decided on : 02-12-2025
Duration : 1 years, 5 months, 3 days
IN THE COURT OF THE XXVIII ADDL. CHIEF JUDICIAL
MAGISTRATE, BENGALURU CITY
Present: Smt.Nagamma.M.Ichchangi,
BA.,LL.B.,(Spl),
XXVIII A.C.J.M, Bengaluru City.
DATED; THIS THE 02nd DAY OF DECEMBER-2025
CC.No.20583/2024
COMPLAINANT : Intelligent Retail Pvt.Ltd.,
R/by its Partner, Senior Area Sales
Manager, Mr. Anothony Rodrigues,
Registered O/at No.L-73,
Attic Space - Drona, 4th Floor,
15th Cross, 3rd Main Road, Sector 6,
HSR Layout, Bengaluru-560102.
(By Sri.Dr.T.A.Mahesh Kumar.,Adv.,)
V/s.
ACCUSED : Mr.Ravi Shankar.H.R S/o Revanna,
Kasaba Hobli, Handalakuppe,
Kunigal (Rural), Tumkur-572130.
(By Sri R.M.D.R.Chavan & Ors.,
Advs.,)
1
C.C.NO.20853/2024
Offence complained of : U/s.138 of N.I.Act
Plea of the Accused : Pleaded not guilty
Final Order : Accused is convicted
Date of order : 25.10.2025
:JUDGMENT:
The complainant company has filed complaint against the accused under section 200 of Cr.P.C., for an offence punishable under section 138 of Negotiable Instruments Act.
2. The case of the complainant's company in brief is as under:
It is the case of the complainant company that, the complainant company is a duly registered under the companies act. The company operates as a business to business (B2B) retail technology platform, offering distribution as a service (DaaS) to fast moving consumer goods (FMCG) Brands and the primary goal of the company is to digitize the distribution sector which has been traditionally dominated by large entities, by implementing a scalable, transparent and plug and play supply chain solution. The complainant asserts that the accused, operating under the names AS store has been involved in the the retail sale of FMCG products within 2 C.C.NO.20853/2024 Bengaluru, maintaining a long standing consumer base. The relationship between the accused firm and the company is based on mutual commercial benefits derived from this trade. In accordance with the established business terms, the complainant company has periodically supplied the goods to the accused's outlets on credit basis. The company has consistently fulfilled its obligations by delivering the pre-agreed goods to the accused's business locations in a timely manner as per the agreed-
upon credit terms. The company's records indicate an outstanding debt amounting to Rs.54,00,000/- pertaining to the goods supplied under the aforementioned terms to the accused's outlets. Despite multiple reminders and communications, the debt remains unpaid, significantly affecting the financial operations of the complainant company. The unpaid amount has imposed considerable financial distress on the complainant company, compromising its operational efficacy and financial stability. The accused has previously acknowledged the debt in communications and has agreed to clear outstanding amount as stipulated in the relevant invoices. However, despite being fully aware of the 3 C.C.NO.20853/2024 financial implications and the breach of agreed terms, the accused has not competed the payment for the outstanding amount in an attempt to settle the debt, the accused had issued a cheque NO.000283 dated: 14.02.2024 for Rs.54,00,000/- drawn on Kotak Mahindra Bank, Frazer Town Branch, Bengaluru in favour of the complainant company. The complainant presented the said cheques through its banker IDFC First Bank Limited, CMS, Bangalore. But the said cheque was dishonored on 26.03.2024 with an endorsements "Payment Stopped by Drawer". Thereafter, on 29.03.2024 the complainant got issued a legal notice to the accused through its counsel calling upon him to pay the cheque amount. The said notice was duly served to the accused on 07.03.2024. After serve of the notice, the accused neither paid the cheque amount nor replied to the notice. As such, the accused has committed an offence punishable under section 138 N.I.Act. Hence, the present complaint came to be filed before this court on 21.06.2024.
3. After registration of the complaint, the cognizance of the offence cited therein was taken. Sworn statement of the complainant was 4 C.C.NO.20853/2024 recorded. Since there were sufficient materials to proceed against the accused, an order was passed on 24.06.2024 to register the case in Register No.III and it was registered as Criminal case.
4. Thereafter, summons was issued to the accused and he has appeared before the court through counsel and secured bail. He was furnished necessary papers as contemplated under section 208 of Cr.P.C. Thereafter, the plea of the accused was recorded by the court. He has pleaded not guilty and claimed to be tried.
5. The complainant's company in support of its case has examined its Authorized Signatory as PW.1 and got marked 15 documents at Ex.P.1 to 15 and closed its side.
6. After closer of the evidence of the complainant's company, the statement of the accused under section 313 of Cr.P.C., was recorded. He has denied the incriminating evidence appearing against him and got marked 05 documents at Ex.D.1 to 5 by way of confrontation during the course of cross examination of PW.1.
7. I have heard the arguments on the both sides and also perused the written argument filed 5 C.C.NO.20853/2024 by the counsel for the complainant and perused the material placed on record.
8. Upon hearing the arguments on the both sides and on perusal of the material placed on record, the following points arise for my consideration:
1.Whether the complainant proves the existence of legally enforceable debt/liability.?
2.Whether the complainant further proves that the accused had issued the cheque-
Ex.P.10, towards the discharge of the legally enforceable debt/liability.?
3.Whether the complainant further proves that the cheque-Ex.P.10 was dishonored for the reason "Payment Stopped by Drawer"
and thereafter the accused had failed to repay the same within the statutory period, inspite of receipt of legal notice.?
4. Whether the accused have thus committed an offence punishable under section 138 of N.I.Act.?
5.What order?
9. My answers to the above points are as under:
Point No.1: In the Affirmative Point No.2: In the Affirmative Point No.3: In the Affirmative Point No.4: In the Affirmative Point No.5: As per final order, for the following:6
C.C.NO.20853/2024 :REASONS:
10. POINT NO.1 to 4: In order to avoid repetition of facts and evidence points No.1 to 4 are taken together for common discussion The complainant company is a duly registered under the companies act. The company operates as a business to business (B2B) retail technology platform, offering distribution as a service (DaaS) to fast moving consumer goods (FMCG) Brands and the primary goal of the company is to digitize the distribution sector which has been traditionally dominated by large entities, by implementing a scalable, transparent and plug and play supply chain solution. The complainant asserts that the accused, operating under the names AS store has been involved in the the retail sale of FMCG products within Bengaluru, maintaining a long standing consumer base. The relationship between the accused firm and the company is based on mutual commercial benefits derived from this trade. In accordance with the established business terms, the complainant company has periodically supplied the goods to the accused's outlets on credit basis. The company has consistently fulfilled its obligations by delivering 7 C.C.NO.20853/2024 the pre-agreed goods to the accused's business locations in a timely manner as per the agreed- upon credit terms. The company's records indicate an outstanding debt amounting to Rs.54,00,000/- pertaining to the goods supplied under the aforementioned terms to the accused's outlets. Despite multiple reminders and communications, the debt remains unpaid, significantly affecting the financial operations of the complainant company. The unpaid amount has imposed considerable financial distress on the complainant company, compromising its operational efficacy and financial stability. The accused has previously acknowledged the debt in communications and has agreed to clear outstanding amount as stipulated in the relevant invoices. However, despite being fully aware of the financial implications and the breach of agreed terms, the accused has not competed the payment for the outstanding amount in an attempt to settle the debt, the accused had issued a cheque in question in favour of the complainant company. The complainant presented the said cheques through its banker. But the said cheque was dishonored with an endorsements "Payment Stopped by Drawer". Thereafter, the complainant 8 C.C.NO.20853/2024 got issued a legal notice to the accused through its counsel calling upon him to pay the cheque amount. The said notice was duly served to the accused. After serve of the notice, the accused neither paid the cheque amount nor replied to the notice. As such, the accused has committed an offence punishable under section 138 N.I.Act. Hence, the present complaint came to be filed before this court.
11. In support of the case, the complainant's company has examined its Authorized Signatory as P.W.1 and the said PW.1 in his chief examination has reiterated the contents of complaint and got marked 15 documents at Ex.P.1 to 1. Ex.P.1 is the Authorization. Ex.P.2 to 9 are the Tax Invoices. Ex.P.10 is the cheque issued by the accused in favour of the complainant on 14.02.2024 for Rs.54,00,000/-. Ex.P.11 is the bank memo dated: 26.03.2024 informing the dishonor of the cheque as Payment Stopped by Drawer. Ex.P.12 is the office copy of legal notice dated: 29.03.2024. Ex.P.13 is the postal receipt. Ex.P.14 is the Postal acknowledgment. Ex.P.15 is the Complaint.
12. The counsel for the complainant has 9 C.C.NO.20853/2024 argued that, the complainant company is a duly registered under the companies act. The company operates as a business to business (B2B) retail technology platform, offering distribution as a service (DaaS) to fast moving consumer goods (FMCG) Brands and the primary goal of the company is to digitize the distribution sector which has been traditionally dominated by large entities, by implementing a scalable, transparent and plug and play supply chain solution. The complainant asserts that the accused, operating under the names AS store has been involved in the the retail sale of FMCG products within Bengaluru, maintaining a long standing consumer base. The relationship between the accused firm and the company is based on mutual commercial benefits derived from this trade. In accordance with the established business terms, the complainant company has periodically supplied the goods to the accused's outlets on credit basis. The company has consistently fulfilled its obligations by delivering the pre-agreed goods to the accused's business locations in a timely manner as per the agreed- upon credit terms. The company's records indicate an outstanding debt amounting to 10 C.C.NO.20853/2024 Rs.54,00,000/- pertaining to the goods supplied under the aforementioned terms to the accused's outlets. Despite multiple reminders and communications, the debt remains unpaid, significantly affecting the financial operations of the complainant company. The unpaid amount has imposed considerable financial distress on the complainant company, compromising its operational efficacy and financial stability. The accused has previously acknowledged the debt in communications and has agreed to clear outstanding amount as stipulated in the relevant invoices. However, despite being fully aware of the financial implications and the breach of agreed terms, the accused has not competed the payment for the outstanding amount in an attempt to settle the debt, the accused had issued a cheque in question in favour of the complainant company. He further argued that the accused has not denied Ex.P.10 being his cheque drawn on the account of the accused. When the signatures is not disputed, the presumption under section 139 N.I.Act is to be drawn in favour of the complainant. The accused has failed to elicit anything in the cross examination of P.W.1 to disbelieve the case of the complainant. The 11 C.C.NO.20853/2024 defence have failed to rebut the presumption under section 139 N.I.Act.
13. The counsel for accused has argued that the cheques are not issued by the accused towards discharge of any debt or liability. The complainant has filed false complaint against the accused by filling up the contents of the cheque which was issued by the accused for the purpose of security of his business with the complainant company. Further argued that the authorization issued by the complainant company in favour of PW.1 was valid only for 1 year and after 1 year the said authorization has lapsed and evidence given by PW.1 on the basis of said authorization has no value in the eye of law and the complaint is also not maintainable as it become defective complaint. Hence, prays for acquittal of accused.
14. In order to attract the offence punishable under section 138 of N.I.Act, the complainant is firstly required to prove the existence of legally enforceable debt/liability, for which the cheques came to be issued. The complainant has to prove all the requirements of section 138 of N.I.Act. Ex.P.10 being his cheque drawn on the account of the accused is not in dispute. The said cheque 12 C.C.NO.20853/2024 having been dishonored, when they were presented by the complainant before the bank for encashment is also not disputed by the accused. Thereafter, the notice-Ex.P.12 being received by the accused. The accused has not taken up any contention that thereafter he had paid the cheque amount within stipulated time of 15 days, after service of the notice the accused neither paid cheques amount nor replied to the notice. Hence, the present complaint came to be filed before the court on 21.06.2024 within the period of one month from the date cause action. As such, in the present case from perusal of documents, the essential requirements of section 138 of N.I.Act, have been complied with.
15. As per the section 139 of N.I.Act, there is a presumption regarding the existence of legally enforceable debt/liability. Such presumption is rebuttable presumption and it is open to the accused to raise defence discharging the existence of a legally enforceable debt/liability. In the case on hand the accused has disputed the existence of legally enforceable debt/liability, for which the cheque-Ex.P.2 to 26 were issued. It is the contention of the accused that the company mentioned in Ex.P.4 & 5 and the company 13 C.C.NO.20853/2024 mentioned in Ex.P.2, 6 to 9 are different and the accused is not liable for the business of the said company. Further, it is the contention of the counsel for accused that Ex.P1 i.e., authorization letter expired on 20-06-2025 and cross examination of PW.1 was conducted on 19-08- 2025 and on the date of his cross examination PW.1 has no authority to depose on behalf of complainant company. On perusal of Ex.P.1 i.e., the authorization letter, it reveals that the said authorization letter expired on 20.06.2024 and cross examination of PW.1 was conducted on 19.08.2025 in that respect the counsel for the complainant has relied upon a decision reported in (2002) 1 SCC 234 in MMTC Ltd., Vs Medcal Chemicals & Pharma (P) Ltd., wherein it is held that:
'Defect in irregularity in
authorization is curable; subsequent
ratification validates the complaint.' Further the counsel for the complainant has relied upon on a decision reported in (2021) 9 SCC 628 in between Bhupesh Rathod Vs wherein it is held that :
'technical errors in corporate authorization are curable and cannot 14 C.C.NO.20853/2024 vitiate proceedings once corporate intent is clear' Hence, the contention of the counsel for accused that the PW.1 has deposed without authorization is not accepted. Further, at the time of filing of the affidavit of PW.1 he was authorized to depose on behalf of the complainant company. When the case is posted for cross examination of PW.1 by that time the authorization that is Ex.P1 was expired. Hence, PW.1 has deposed before this court on the strength of Ex.P1. Therefore, evidence of PW.1 is valid as once a complaint is filed and chief examination of PW.1 was recorded on the basis of authorization subsequent expiry of authorization has no effect on the validity of the complaint.
16. Further, it is the contention of the counsel for the accused that the accused has issued 05 cheques bearing Nos.277 to 285 out of them 04 cheques were honored and one cheque was filled up by the complainant and presented the same for encasement after filling up the same as per their whims. In support of their contention they have produced Ex.D1 which is account statement of accused wherein it is shown that the cheque bearing No.280,284 and 285 are honored.
15C.C.NO.20853/2024 During cross examination of PW.1 the counsel for accused suggested that cheque bearing No.280, 284 and 285 are honored in respect of invoices raised as per Ex.P 2 to 9. This suggestion goes to show that the complainant company has raised invoices as per Ex.2 to 9 after supply of materials mentioned in the said invoices and cheque bearing No.280,284 and 285 are issued to clear the amount of said invoices.
17. It is the contention of the counsel for accused that the accused had issued 05 cheques bearing No.277 to 285 for clearing the bill amount mentioned at Ex.2 to 9 and out of 05 cheques the complainant company has misused Ex.P10 which was given for security purpose. If at all the accused has issued the cheque for security purpose then what prevented the accused from initiating proceedings against the complainant for misusing his cheque. No prudent man will keep quite after knowing that his cheque is misused. Though the accused got marked 05 documents at Ex.D.1 to 5 i.e., account statement of accused, reply notice, postal receipts and acknowledgment. On perusal of Ex.D2 i.e., reply notice it reveals that the accused in reply notice himself has stated that the complainant company has 16 C.C.NO.20853/2024 collected cheque from the accused in the year 2022 for the supply of goods but not supplied the goods or not returned the cheque. If at all the accused had issued Ex.P1 in the year 2022 then the accused would have given stop payment instructions to the concerned bank or he would have taken legal action against the complainant company for misusing his cheque. But no steps are taken by the accused. Hence, it shows that the accused has taken false defence stating that the cheque is misused by the complainant company which was issued for security purpose.
18. Once issuance of the cheque and signature are admitted, the statutory presumptions would arise under sections 118 and 139 of the N.I.Act that the cheque was issued by the drawer for legally payable debt or liability and for valid consideration. The Hon'ble Supreme Court has held in Rangappa V/s Mohan, reported in 2010 AIR SCW 296, the presumption that the cheque was drawn in discharge of legally recoverable debt is a presumption of law that ought to be raised in every case, though, it is a rebuttable presumption. The presumption under section 139 and 118 of the N.I.Act are rebuttal presumption. Further it is also held that mere 17 C.C.NO.20853/2024 plausible explanation by the drawer is not sufficient and proof of that explanation is necessary. The principle of law laid-down in the above decision is applicable to the facts of this case. In the instant case, since the complainant is in possession of the cheque-Ex.P.10 the court has to draw the initial presumption that he is the payee of that cheque. Once the initial burden is discharged by the complainant, the onus shifts on the accused to rebut the complainant's case.
19. In the case of Sripati Singh (Since deceased) through his son Gaurav Singh V/s State of Jarkhand and another, reported in 2021 SCC Online SC 1002, the Hon'ble Supreme court categorically held that; once the cheque is issued as security for the loan and if the loan is not paid back then if the cheque is dishonored it attracts offence punishable 138 of N.I.Act. The principle laid-down in the above said decision is applicable to the facts of this case. Therefore, the contention of the accused cannot be acceptable that the cheques were given only for security purpose without there being any cogent evidence on accused side to probables his defence.
20. In the case of K.S.Ranganatha V/s Vittal Shetty, reported in 2021 SCC Online SC 1191, 18 C.C.NO.20853/2024 the Hon'ble Supreme Court held that, once the cheque is admitted to be that of the accused, 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. It is further held that the position of law makes it crystal clear that when a cheque is drawn out and is relied upon by drawee, it will raise a presumption that it is drawn towards a consideration which is a legally recoverable amount; such presumption of course, is rebuttable by proving to the contrary. The onus is on the accused to raise a probable defence and the standard of proof for rebutting the presumption is on preponderance of probabilities.
21. In the case of Kalemani Tex and another V/s P.Balasubramanian, reported in (2021) 5 SCC 283, the Hon'ble Supreme Court has observed that even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under section 139 of the Negotiable instruments Act, in the absence of any 19 C.C.NO.20853/2024 cogent evidence to show that the cheque was not issued in discharge of a debt.
'
22. In addition to this in the case of T.P.Murugan (Dead) through legal representatives V/s Bojan, reported 2018 (8) SCC 469, the Hon'ble Apex Court held that once the cheque has been signed and issued in favour of the holder of the cheque, there is statutory presumption that the cheque is issued in respect of legally enforceable debt or liability: rebuttal of such presumption must be by adducing credible evidence. Mere raising a doubt without cogent evidence with respect to the circumstances, presumption under section 139 of N.I.Act cannot be discharged. The principle of law laid-down in the above decisions are applicable to the facts of this case. Except some bald contentions, the accused has not been able to make out a probable case on his behalf.
23. In the instant case the accused has nowhere denied issuance of cheques and he himself has admitted that he is the holder of alleged cheques. It is sufficient to hold that the accused has issued the cheques and even after the accused has not repaid the cheques amount 20 C.C.NO.20853/2024 the getting of receipt of notice. However, in any manner as the complainant have complied all the terms of ingredients of the provisions of 138 of N.I.Act. The accused is liable for dishonor of cheque. In case of dishonor of cheques, once the execution of cheques are admitted by the accused, then it for him to first rebut presumption arising out of section 139 of N.I.Act. Accordingly, PW.1 has established the case of the complainant, the accused has issued the cheque- Ex.P.10 in order to repay the legally recoverable amount. Therefore, the accused has failed to probables the defence taken by him. Therefore, the accused has failed to rebut the presumption under section 139 of N.I.Act. Hence, the accused liable for dishonor of the cheque. With these reasons, I answer point No.1 to 4 in the Affirmative.
24. POINT NO.5: The accused is held to have committed an offence punishable under section 138 of N.I.Act. The complainant has proved its case. The accused has failed to prove his rebuttal for the reasons mentioned above and in view of the mandatory requirements of section 138 of N.I.Act, being complied with. The accused is found to have committed an offence punishable 21 C.C.NO.20853/2024 under section 138 of N.I.Act. Since, the said offence is an economic crime, the accused is not entitled for the beneficial provisions of probation of offenders Act. In view of the above discussions and the findings on point No.1 to 4, I proceed to pass the following:
ORDERS Acting under section 255(2) of Cr.P.C. the accused is convicted for an offence punishable under section 138 of N.I.Act.
The bail bonds and surety bonds of the accused hereby stands canceled.
The accused is sentenced to pay fine of Rs.54,10,000/- (Rupees Fifty Four Lakhs Ten Thousand Only) to the complainant.
It is further ordered that out of the said fine amount an amount of Rs.54,00,000/- (Rupees Fifty Four Lakhs Only) shall be paid to the complainant as compensation as per Section 357(1)(b) of Cr.P.C., and remaining amount of Rs.10,000/- (Rupees Ten thousand only) shall be remitted to the State.22
C.C.NO.20853/2024 In default of the payment of fine amount, the accused shall undergo simple imprisonment of 03 months.
Office to furnish free copy of this judgment to accused forthwith. (Dictated to the stenographer directly on computer typed by her, corrected by me and then judgment pronounced in the open court on 02nd day of December 2025) NAGAMMA Digitally signed by NAGAMMA ICHCHANGI ICHCHANGI Date: 2025.12.08 17:17:30 +0530 (Smt.Nagamma.M.Ichchangi) XXVIII Addl. Chief Judicial Magistrate, Bengaluru City. ANNEXURE List of witness examined on behalf of the complainant:
PW.1 : Mr.Anthony Rodrigues S/o Rafel Rodrigues. List of documents marked on behalf of the complainant:
Ex.P.1 : Authorization. Ex.P.2 to 9 : Tax Invoices. Ex.P.10 : Cheque. Ex.P.11 : Bank endorsement. Ex.P.12 : Office copy of legal notice. Ex.P.13 : Postal receipt. Ex.P.14 : Postal acknowledgment. Ex.P.15 : Complaint.
List of witnesses examined on behalf of the accused:
-Nil-
List of documents marked on behalf of the accused:
Ex.D.1 : Account statement of accused, Ex.D.2 : Reply notice. Ex.D.3 & 4 : Postal receipts. Ex.D.5 : Postal acknowledgment. Digitally signed by NAGAMMA NAGAMMA ICHCHANGI ICHCHANGI Date: 2025.12.08 17:17:38 +0530 XXVIII Addl. Chief Judicial Magistrate, Bengaluru City. 23 C.C.NO.20853/2024 02.12.2025 Accused absent. Counsel for
the accused present and EP filed, since this court is going to convict the accused. Hence EP is rejected. Hence vide separate judgment is pronounced in the open court.
(Judgment pronounced in the Open Court Vide Separate Sheet) :ORDER:
Acting under section 255(2) of Cr.P.C. the accused is convicted for an offence punishable under section 138 of N.I.Act.
The bail bonds and surety bonds of the accused hereby stands canceled.
The accused is sentenced to pay fine of Rs.54,10,000/- (Rupees Fifty Four Lakhs Ten Thousand Only) to the complainant.
It is further ordered that out of the said fine amount an amount of Rs.54,00,000/- (Rupees Fifty Four Lakhs Only) shall be paid to the complainant as compensation as per Section 357(1)(b) of Cr.P.C., and remaining amount of 24 C.C.NO.20853/2024 Rs.10,000/- (Rupees Ten thousand only) shall be remitted to the State. In default of the payment of fine amount, the accused shall undergo simple imprisonment of 03 months.
Office to furnish free copy of this judgment to accused forthwith.
XXVIII Addl. Chief Judicial Magistrate, Bengaluru City.