Bangalore District Court
To Repay It Within One Year With Interest ... vs Through His Counsel. The Notice Through ... on 18 September, 2020
1 CC.8337/2018 (J)
IN THE COURT OF THE XV ADDL CHIEF METROPOLITAN
MAGISTRATE AT BANGALORE CITY.
Dated this the 18th day of September-2020
Present: Lokesh Dhanapal Havale.
B.A.L.L.B.,
XV Addl.C.M.M., Bangalore.
Judgment U/s.355 of the Cr.P.C. 1973.
1.Sl.No.of the case CC.No.8337/2018
2.Name of the Complainant: K.RAMACHANDRA RAJU,
S/o.K.Subbaraju,
Aged about 51 years,
R/at No.69, Flat No.201,
CQAL Layout,
Behind Ganesha Temple,
Sahakaranagar,
Bangalore - 560 092.
3.Name of the accused: ROHAN CONSTRUCTIONS,
Prop:- K.KUMAR,
S/o.Keerthi Patil Kesavaraju,
Major,
Office at No.117, 6th Cross,
Bhadrappa Layout,
Sanjaynagar Post,
Bangalore - 560 094.
Permanent Residing Address at
Athimanjeri Village & Post,
Tiruvallur District,
Pallipat Taluk,
Tamilnadu - 631202.
2 CC.8337/2018 (J)
4.The offence complained of U/s.138 of Negotiable
: Instruments Act.
5.Plea of the accused: Pleaded not guilty.
6.Final Order: Acting U/s.255(2) Cr.P.C.,
accused is Convicted.
7.Date of final Order 18th day of September-2020.
***
This complaint is filed U/Sec.200 of Cr.P.C. against the
accused for the offence punishable U/Sec.138 of the
Negotiable Instruments Act, 1881.
2. The facts in brief are as under:-
The complainant and the accused are well known to
each other. Accused needed funds for his business and
approached the complainant of Rs.2,50,000/- in the first
week of September 2016. The accused borrowed hand loan
of Rs.2,50,000/- on 14.9.2016 by way of cash assuring the
complainant to repay it within one year with interest @
12% p.a. He did not repay as agreed. After demand he
issued cheque bearing No.655487 dated 25.01.2018 for
sum of Rs.2,50,000/- drawn on Karanataka Bank Ltd,
Sahakaranagar Branch, Bengaluru-560092 towards the
3 CC.8337/2018 (J)
legally enforceable debt. The complainant presented the
said cheque on 25.01.2018 for encashment through his
Bank i.e. Karnataka Bank Ltd, Sanjaynagar Branch,
Bengaluru. The said cheque was returned with an
endorsement "Funds Insufficient" on 03.02.2018. The
complainant issued demand notice on 14.02.2018 to the
accused through his counsel. The notice through RPAD
was served on accused on 15.02.2018 on his office address
and on 20.02.2018 on his permanent address. After
receiving the notice the accused neither replied nor paid
the loan amount within 15 days.
3. After the institution of the complaint, cognizance
has been taken and the case has been registered as PCR
No.4170/2018. The sworn statement of the complainant
has been recorded and on the basis of sworn statement
and other materials on hand the criminal case has been
registered against the accused and summons was issued to
him. In response to the service of summons the accused
appeared through his learned counsel and got enlarged on
4 CC.8337/2018 (J)
bail. The prosecution papers supplied to the accused and
the substance of accusation for the offence punishable
U/s.138 of Negotiable Instruments Act was read over to the
accused. He pleaded not guilty and claimed to be tried.
4. During trial the complainant examined as PW-1
and got marked Ex.P.1 to P.7. The statement of the
accused U/s. 313 of Cr.P.C. was recorded. The accused
lead defence evidence and examined as DW-1 and got
marked Ex.D.1.
5. I have heard the argument of both learned
counsels and perused the entire materials. The following
points would arise for my consideration.
1. Whether the complainant proves that
the Accused issued the cheque
bearing No.655487 for Rs.2,50,000/-
drawn on Karnataka Bank Ltd.,
Sahakaranagar Branch, Bengaluru in
his favour towards the discharge of
legally enforceable debt/liability and
on its presentation for encashment, it
was dishonored with an endorsement
5 CC.8337/2018 (J)
of "Funds Insufficient" in the account
maintained by the accused and the
accused has not paid the amount
even after 15 days from the date of
service of notice on him and thereby
accused committed an offence
punishable U/Sec.138 of N.I. Act,
1881 ?
2. Whether the accused rebuts the
presumption U/s.139 of N.I.Act?
3. What order?
6. My answers to the above points are as under.
Point No.1 : In the Affirmative
Point No.2 : In the Negative
Point No.3 : As per final order for the following:-
REASONS
7. Point No.1 & 2:- The points are taken together
for discussion to avoid repetition of facts and evidence. At
this juncture, it is necessary to go through the provisions
of N.I.Act before proceeding further. The provisions under
Section 118(a) and 139 of the Act., 1881 are extracted and
they reads thus:-
6 CC.8337/2018 (J)
"118. Presumptions as to
negotiable instruments. - Until the
contrary is proved, the following
presumptions shall be made:-
(a) of consideration - that every
negotiable instrument 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.
(b) as to date:- that every
Negotiable Instrument bearing date
was made or drawn on such date;
"139. Presumption in favour of
holder.- It shall be presumed, unless
the contrary is proved, that the
holder of a cheque received the
cheque of the nature referred to in
section 138 for the discharge, in
whole or in part, of any debt or other
liability."
7 CC.8337/2018 (J)
8. On plain perusal of the provisions under Section
118(a) and 139 of the N.I.Act., as extracted herein above, it
can be seen that initially the presumptions constituted
under these two provisions favour the complainant.
However, it is open to an accused to raise a defence to
rebut the statutory presumptions. An accused can raise a
defence wherein the existence of legally enforceable debt or
liability can be contested.
9. It is also well established that an accused for
discharging the burden of proof placed upon him under a
statute need not examine himself. He may discharge his
burden on the basis of the materials already brought on
record. An accused has constitutional rights to maintain
silence. Standard of proof on part of the accused and that
of the prosecution in a Criminal case is different. The
prosecution must prove the guilt of an accused beyond all
reasonable doubts, the standard of proof so as to prove a
defence on the part of an accused is "Preponderance of
probabilities".
8 CC.8337/2018 (J)
10. Under the light of above extracted provisions of
the Act, I have perused the oral and documentary evidence
on record. In order to prove his case the complainant
examined himself as PW.1 and got marked Ex.P.1 to P.7.
Ex.P.1 is the cheque dated 25.01.2018 for Rs.2,50,000/-
and Ex.P.1(a) is the signature of the accused on the
cheque, Ex.P.2 is the Bank endorsement dated 3.02.2018,
Ex.P.3 is the office copy of the statutory notice dated
14.2.2018, Ex.P.4 and P.5 are the two postal receipts for
having been sent the statutory notice to the accused
through registered post and Ex.P.6 and P.7 are the Postal
acknowledgements for having served the statutory notice
on the accused at his work address and permanent
address.
11. I have perused the exhibits on which the
complainant has placed his reliance. On plain perusal of
the exhibits which disclose that the complainant has
complied the ingredients of Section 138(a) and (b) of the
N.I.Act. The accused has denied the service of notice.
However, during the course of cross-examination the
9 CC.8337/2018 (J)
accused admitted the address mentioned in the Postal
acknowledgements. The admission leads to draw
presumption as per Section 27 of General Clauses Act,
which states that the notice sent through post shall be
deemed to be served, if it is properly addressed to a person
to whom it is sent. Therefore, in view of the admission of
the address by the accused, the notice at Ex.P.3 is deemed
to have been served on him as per Ex.P.6 and P.7.
Therefore, the documents on record show that the
complainant has complied all the ingredients U/s.138 of
N.I.Act.
12. It is the specific defence of the accused that he
issued two cheques in favour of the complainant in respect
of chit business and the complainant misused the cheque
bearing No.655487. He took two chits from the
complainant for an amount of Rs.2,50,000/- each and as a
security for the said amount, he issued two cheques in the
year 2015. He was paying Rs.10,000/- for each chit and
totally Rs.20,000/- per month. Apart from the said
10 CC.8337/2018 (J)
defence, he took the defences stating that the complainant
has not lent any amount for his business; the complainant
has no financial capacity to lend the loan; he is not well
known person to him and the complainant has not
produced any documents for having lent the amount of
Rs.2,50,000/- to him and also other tenable defences
denying the transaction.
13. The complainant/PW-1 filed affidavit in lieu of
his evidence and reiterated complaint averments. In the
cross-examination he denied all the suggestions made by
the counsel for the accused and deposed pertaining to the
facts averred in the complaint. It is undisputed fact that
both the accused and the complainant are civil contractors
taking contracts from the BBMP. The amount has to be
invested by them first and after completion of the contract
work, the amount has to be taken from the Government.
PW-1 admitted that accused is his family friend. The
accused also admitted that they were civil contractors and
they knew each other through the said business. This
11 CC.8337/2018 (J)
shows that the accused and complainant are well known to
each other.
14. The accused also took defences stating that the
complainant is money lender and there is no legally
enforceable debt and he also challenged the financial
capacity of the complainant. The counsel for the accused
argued on the said point and also relied on the decisions
reported in (2015) 1 SCC 99, 2015 (3) DCR 132 Hon'ble
High Court of P & H, 2015 (3) DCR 782 Hon'ble High Court
of P & H, 2016 (3) DCR 673 Hon'ble High Court of P & H,
wherein the Hon'ble Apex Court and the Hon'ble High
Court of P & H held that if the complainant failed to prove
source of funds and financial capacity to lend the
presumption U/s.139 of N.I.Act goes against the
complainant. However, the above defences are
contradictory to each other. It was elicited in the cross-
examination of PW-1 that he has no licence to lend the
money. On perusal of the complaint, it is clear that the
complainant has stated that the accused assured him to
repay the amount along with interest @ 12% p.a. It is
12 CC.8337/2018 (J)
nowhere stated in the complaint that he lent money to the
accused on interest @ 12% p.a. There is no evidence on
record to show that complainant lent money to others
apart from accused and he is involved in the money
lending business. Therefore, the defence taken by the
accused does not appear to be tenable. Further it is the
defence of accused that the complainant has borrowed
huge amount of loan during the said period and he has no
capacity. It was suggested by the counsel for the accused
to PW-1 that he has overdraft facility of Rs.1.5 to 2 Crores
in the Karnataka Bank, Sanjayanagar Branch, Bengaluru
and it was admitted. The accused also stated that in his
evidence that the complainant has loan of about Rs.2
Crores. These aspects show that he has financial capacity
as the Bank would not provide any person the overdraft
facility, who is not financially sound. It is also admitted
fact that complainant is civil contractor of BBMP.
Therefore, it is clear that he has source of Income from
contract business and he is financially sound to lend small
13 CC.8337/2018 (J)
amount of Rs.2,50,000/-. Therefore, the defence of the
accused in respect of financial capacity is not tenable.
15. It was elicited in the cross-examination of PW-1
that he has no documents or witnesses to show that he
lent amount to the accused on the alleged date. For the
reason that no documents have been produced to show
that loan by way of cash was given on alleged date is not a
ground to reject the case of the complainant. The
complainant issued notice as per Ex.P.3 to the accused
and it was served on him but the accused neither replied
nor paid. Moreover, the accused admitted the issuance of
cheque, signature and the amount mentioned in it.
Therefore, the presumption arises in favour of the
complainant. The admission attracts the ratio laid down by
the Hon'ble Supreme Court of India in its decisions
reported in 2011 (11) SCC 441 - Rangappa V/s Mohan and
2015 (8) SCC 378 - T.Vasanthakumar V/s.Vijayakumari.
The ratio is that the cheque shall be presumed to be for
consideration unless and until the court forms a belief that
14 CC.8337/2018 (J)
the consideration does not exist or considers the non-
existence of consideration was tenable that a prudent man
would under no circumstances act upon the plea that the
consideration does not exist.
16. It is the specific defence of the accused that two
cheques were issued to the complainant in respect of chit
transaction amounting to Rs.2,50,000/- each and he was
paying the amount of Rs.10,000/- for each chit and totally
Rs.20,000/- per month. The accused asked the
complainant to return the cheques, which were taken as
security for chit transaction but the complainant did not
return the cheques and misused one of them. The counsel
for the accused cross-examined the PW-1 in length in
respect of the above said defence but nothing was elicited
in respect of the chit transaction between complainant and
accused taken place during the year 2015. However, it was
elicited that the complainant runs the chit. Apart from that
the accused examined himself as DW-1 and marked CD as
Ex.D1 along with the certificate U/s.65B of the Indian
Evidence Act, 1872 in support of his evidence. DW-1
15 CC.8337/2018 (J)
stated in his evidence that the CD is pertaining to the
conversation in respect of chit transaction alleged to have
taken place between him and the complainant during the
year 2015. He did not produce any documents for having
made transactions with the complainant in respect of chit
during the year 2015. DW-1 stated in his evidence that he
talked with complainant through his mobile number
9066866999 and 9113928508 and asked about the new
chit and the complainant replied stating that Rs.10 lakhs
chit transaction completes in two months and he would
start new chit transaction thereafter. He also stated that if
one of the old members of the chit left the chit, then only
new member could be joined.
17. At this juncture, it is necessary to discuss about
the evidentiary value of Ex.D.1 with reference to Section 65
of Indian Evidence Act. The Hon'ble Supreme Court of
India in its decision dated 14.07.2020 in the case of Arjun
Pandith Rao Kotkar Vs. Kailash Ushan Rao Gorantyal and
others clarifies the conflict in respect of interpretation of
16 CC.8337/2018 (J)
Section 65B of Indian Evidence Act, 1872 and held as
follows:-
• The certificate required under
Section 65B (4) is a condition
precedent to the admissibility of
evidence by way of electronic record.
• Section 65B(1) couched in a non-
obstante clause clarifies that
admissibility and proof of
information contained in an
electronic record must follow
Section 65B, being a special
provision and Sections 62 to 65 are
irrelevant with respect to such
electronic records.
• Electronic records may be the
original information contained in the
"Computer" itself and copies made
therefrom, such "original" being
primary evidence while the copies
being secondary evidence.
Therefore, the certificate in Section
65B(4) is unnecessary if the original
document itself is produced. Such
17 CC.8337/2018 (J)
production of the original may be by
way of the owner of a laptop, tablet
or a mobile phone stepping into the
witness box and proving that the
concerned device, on which the
original information is first stored, is
owned and/or operated by him.
Such proof however cannot be
adduced if the device cannot be
physically brought to Court [in such
case the only means of proving the
information will be in accordance
with Section 65B(1) read with
Section 65B(4)]. Accordingly, the
Court clarified that the last sentence
in paragraph 24 of Anvar which
reads as "..if an electronic record as
such is used as primary evidence
under Section 62 of the Evidence
Act.", may more appropriately be
read without the words "under
Section 62 of the Evidence Act".
• The difficulty in obtaining a
document can be overcome by
various statutory provisons: (i)
Section 165 of the Act empowers a
18 CC.8337/2018 (J)
Judge to order production of any
document or thing in order to
discover or obtain proof of relevant
facts: (ii) order XVI of the Civil
Procedure Code 1908 deals with
'Summoning and Attendance of
Witnesses' and the Court can issue
orders for the production of
documents; (iii) Sections 91 and 349
of the Code of Criminal Procedure,
1973.
• In a situation where the Certificate
has been applied for and the person
or authority does not comply with
such request, parties can apply to
the Court to direct the person to
produce the certificate. Even if
pursuant to the directions of the
Court the certificate cannot be
obtained, the alleged disobedience of
the law is excused.
• Section 65B is silent as regards
when the certificate is to be
produced. Though generally the
certificate must accompany the
electronic record when the same is
19 CC.8337/2018 (J)
produced in evidence, through there
is some level of discretion that may
be exercised depending on the facts
of each case. In sofar as criminal
trials are concerned, though
generally documents are to be filed
before commencement of the trial,
the Court may exercise discretion
and allow production later if no
prejudice is caused.
18. In the case on hand the accused has produced
Ex.D.1 C.D. along with certificate issued by himself in his
favour. The accused has not produced the Samsung
Galaxy J-7 Duo mobile, in which conversation is alleged to
have been recorded, even though it is possible for him to
produce the mobile. He did not mention the date of
recording of conversation in the certificate. He did not
produce documents to show that the mobile numbers
9066866999 and 9113928508 belong to him and they were
used in his mobile. He did not produce document to show
that the said mobile belongs to him. He did not mention
the mobile numbers in the certificate. As per the Section
20 CC.8337/2018 (J)
the certificate has to be issued by the person in whose
control the device is. In the case on hand the accused
stated that he is the owner of the mobile, sim cards of
above mobile numbers, DELL Laptop and himself copied
the recordings in the C.D. However the date of recording
and the date of copying is not mentioned in the certificate.
Therefore, the certificate itself is defective and no
evidentiary value can be attached to Ex.D.1. Moreover, the
recording is not pertaining to the chit transaction between
complainant and accused during the year 2015. The
conversation only shows that the complainant runs the
chit. The date of call to the complainant is subsequent and
it is an after thought of the accused to escape from the
liability of the payment. In his cross-examination the
accused stated that he can produce the documents
pertaining to the mobile numbers but he failed to produce.
Similarly he stated that he could not say the date on which
he talked with the complainant over the phone. He clearly
admitted that the conversation in Ex.D.1 is not pertaining
to the chit transaction alleged to have taken place in the
21 CC.8337/2018 (J)
year 2015. Therefore, the defence of the accused is not
tenable and it is not sufficient to rebut the presumption
U/s.139 of N.I.Act raised in favour of the complainant. The
said defence is also not tenable for another reason that the
accused alleged to have given two cheques but the accused
did not even mention the another cheque number in his
evidence and he has not taken any legal action against the
complainant for not returning the cheques. He has also
not replied to the demand notice at Ex.P.3 stating that the
said cheques were given as security to chit transaction and
the complainant has misused the same.
19. The accused also took defence stating that the
complainant has manipulated the cheque and the writings
on the cheque differ and the date mentioned in the cheque
is not correct. It is admitted by the accused that he gave
the cheque in question to the complainant by mentioning
the amount and making the signature. He disputed the
name and date on the cheque. As per the presumption
U/s.118(b) of N.I.Act every Negotiable Instrument bearing a
22 CC.8337/2018 (J)
date was made or drawn on such date and as per Section
20 of the N.I.Act, if the person signs and delivers
Negotiable Instrument and it is left incomplete and thereby
he authorizes the holder to complete the Negotiable
Instrument and thereby he is liable for the amount
mentioned in the Negotiable Instrument. Therefore, the
defence of the accused is not tenable. Further in view of
the Judgment rendered by the Hon'ble Supreme Court of
lndia in its Criminal Appeal No.230-231 of 2019 - Bir
Singh V/s.Mukesh Kumar also the above defence is not
tenable. The para No.38 and 40 of the said Judgment are
extracted and the paragraphs reads thus:-
38. If a signed blank cheque is
voluntarily presented to a payee,
towards some payment, the payee may
fill up the amount and other
particulars. This in itself would not
invalidate the cheque. The onus would
still be on the accused to prove that
the cheque was not in discharge of a
debt or liability by adducing evidence.
23 CC.8337/2018 (J)
40. Even a blank cheque leaf,
voluntarily singed 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
cogent evidence to show that the
cheque was not issued in discharge of
a debt.
20. For the reasons mentioned herein above, it is
crystallized that the accused has utterly failed to prove the
thing that there was no existence of legally enforceable
debt between him and the complainant at the given point
of time and he has not at all issued the instant cheque
towards the discharge of legally enforceable debt of
Rs.2,50,000/-. Under the circumstances, it can be
gathered that, the accused failed to rebut the statutory
presumption as available U/s.118(a & b) and 139 of the
N.I.Act. Accordingly the accused is found guilty for the
offence punishable U/s.138 of the N.I.Act. Hence, I
proceed to answer the point No.1 in Affirmative and Point
No.2 in the Negative.
24 CC.8337/2018 (J)
21. Point No.3 : In view of the reasons assigned on
Point No.1 and 2, I proceed to pass the following:-
ORDER
As per the provisions of Sec.255(2) Cr.P.C. the accused is hereby sentenced for the offence punishable u/s.138 of NI Act, 1881. The Accused shall liable to pay fine of Rs.2,60,000/- (Rupees Two Lakhs Sixty Thousand Only.) On deposit of fine amount the complainant is entitled for compensation of Rs.2,55,000/- (Rupees Two Lakhs Fifty Five Thousand only). The remaining balance amount of Rs.5,000/- is to be forfeited to the State.
In default of payment of the fine amount accused shall undergo simple imprisonment for six months.
The personal bond executed by the accused is hereby stands cancelled and cash surety of Rs.2,000/- furnished by the accused shall be refunded to him after expiry of appeal period.
25 CC.8337/2018 (J) Copy of the judgment shall be furnished to the accused at free of cost.
(Dictated to the Stenographer, transcript thereof is computerized and printout taken by him, is verified and then pronounced by me in Open Court on this the 18th day of September-2020.) (Lokesh Dhanapal Havale) XV Addl. CMM., Bangalore.
ANNEXURE Witnesses examined for the Complainant:-
PW.1 Ramachandra Raju Documents marked for the Complainant:-
Ex.P.1 Cheque.
Ex.P.1a Signature of the accused.
Ex.P.2 Bank endorsement.
Ex.P.3 Legal Notice.
Ex.P.4 & P.5 Two Postal Receipts.
Ex.P.6 & P.7 Two Postal Acknowledgements.
Witnesses examined For Defence:-
DW-1 K.Kumar Documents marked for Defence:-
Ex.D.1 Compact Disc along with 65-B Certificate.
(Lokesh Dhanapal Havale) XV Addl. CMM., Bangalore.
26 CC.8337/2018 (J) 18.09.2020 (Judgment Pronounced in the Open Court Vide Separate Order sheet ORDER As per the provisions of Sec.255(2) Cr.P.C. the accused is hereby sentenced for the offence punishable u/s.138 of NI Act, 1881. The Accused shall liable to pay fine of Rs.2,60,000/- (Rupees Two Lakhs Sixty Thousand Only.) On deposit of fine amount the complainant is entitled for compensation of Rs.2,55,000/- (Rupees Two Lakhs Fifty Five Thousand only). The remaining balance amount of Rs.5,000/- is to be forfeited to the State.
In default of payment of the fine amount accused shall undergo simple imprisonment for six months. 27 CC.8337/2018 (J) The personal bond executed by the accused is hereby stands cancelled and cash surety of Rs.2,000/- furnished by the accused shall be refunded to him after expiry of appeal period.
Copy of the judgment shall be furnished to the accused at free of cost.
(Lokesh Dhanapal Havale) XV Addl.CMM., Bangalore.
28 CC.8337/2018 (J)