Bangalore District Court
Madhu Steel Corporation vs Kumar.A.N on 8 November, 2024
KABC0C0227142021
IN THE COURT OF XIV ADDL.CHIEF JUDICIAL
MAGISTRATE, MAYOHALL UNIT, BENGALURU
Dated this the 8th day of November, 2024
Present : SANTHOSH S.KUNDER., B.A.,LLM,
XIV Addl.C.J.M., Bengaluru
JUDGMENT UNDER SECTION 355 of Cr.P.C
C.C.No.57067/2021
Complainant Madhu Steel Corporation,
No.5 & 6, Millia Building,
N.R.Road, II Cross,
BENGALURU-560 002.
Represented by GPA-Holder of
the Proprietrix,
Sri.D.P.Gupta.
(By Sri.J.Vittal.Rao, Advocate)
V/s
Accused Mr.Kumar.A.N,
S/o Nagaraju A.S,
Prop: Kumar Material suppliers,
Abbanakuppe,
Near Tayota Kirlosker,
Bidadi Industrial Area, Bidadi
Ramanagaram Dist.
(By Sri.Niranjan Ganig.N, Advocate)
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Offence U/s 138 of Negotiable Instruments Act.
Plea of the Pleaded not guilty
accused
Final Order Convicted
This complaint is filed for the offence punishable
under Section 138 of the Negotiable Instruments Act.
2. Complaint averments in brief:
Complainant is dealing in iron and steel materials.
Accused is a dealer in building materials. He has
purchased materials worth ₹11,75,391/- from the
complainant on credit basis. To discharge the said liability,
with a pre-planned criminal intention of cheating the
complainant, he has issued a post-dated cheque in favour
of the complainant bearing No.233872 dated 30.04.2014
for ₹11,75,391/-, drawn on Canara Bank, Bidadi. At the
time of issuing the said cheque, he had assured the
complainant that he would maintain sufficient balance in
his account to honour the cheque. However, when the
complainant presented the said cheque for encashment
through DCB Bank Ltd., M.G.Road Branch, Bengaluru, it
was dishonoured for the reason 'funds insufficient', vide
memo dated 05.05.2014. After the dishonour of the
cheque, the accused contacted the complainant and
requested not to take any action and promised to pay the
dishonoured cheque amount within 10 days. Since, he has
failed to keep up his words, the complainant has
constrained to issue legal notice dated 16.05.2014 to him
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through speed post/POD. The said demand notice served
on 26.05.2014. After the receipt of the legal notice, the
accused once again contacted the complainant and
requested not to file the complaint and assured that he will
make payment of the dishonoured cheque amount within
15 days along with interest, etc. Since, he has failed to
make payment as assured, this complaint is filed.
3. This court took cognizance of the offence
punishable under Section 138 of Negotiable Instruments
Act. As there were prima facie materials, criminal case was
registered and the accused was summoned.
4. Pursuant to the process, the accused has
appeared before the court. He was enlarged on bail. After
compliance of Sec.207 of Cr.P.C, this court recorded his
plea. He has pleaded not guilty and claimed to be tried.
5. Sworn statement of the power of attorney of
Proprietrix of complainant by name, D.P.Gupta treated as
evidence. He has also filed additional affidavits by way of
examination-in-chief. He was examined as PW-1.
Documents at Ex.P-1 to 35 marked for the complainant.
6. After the closure of complainant's evidence,
statement of accused under Sec.313 of Cr.P.C. recorded.
He has denied the incriminating evidence. Accused has not
led defence evidence. Two documents at Ex.D-1 and 2
marked for the accused in the cross-examination of PW-1.
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7. Argument was advanced on behalf of the
complainant, whereas, advocate for accused has not
turned up to address argument.
8. Perused the evidence on record.
9. Points for consideration are :
1. Whether the complainant has
proved that accused issued bearing
No.233872 dated 30.04.2014 for
₹11,75,391/- drawn on Canara Bank,
Bidadi to the complainant towards
discharge legally recoverable debt/liability
and the said cheque was dishonored for
the reason 'funds insufficient' and in spite
of issuance of statutory notice dated
26.05.2014, the accused failed to pay the
amount covered under the cheque and
thereby committed the offence punishable
under Section 138 of N.I.Act?
2. What order?
10. The above points are answered as under:-
Point No.1 : In the affirmative.
Point No.2 : As per final order for the following :
REASONS
11. Point No.1: In order to prove the contentions, as
stated above, the complainant examined as PW-1. Of
documents marked for the complainant, Ex.P-1 is general
power of attorney executed by Proprietrix of the
complainant Smt.Madhu Bansal in favour of her father/
PW-1; Ex.P-2 is the subject cheque; Ex.P.3 is bank
endorsement; Ex.P-4 is copy of legal notice dated
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16.05.2024; Ex.P.5 is postal receipt; Ex.P-6 is postal track
consignment report; Ex.P.7 is visiting card of Kumar
Material Supplier; Ex.P.8 and 9 is certified copies of
depositions of C.Balakrishna Raju, recorded in
C.C.No.12908/2013 and CC.No.12909/2013; Ex.P.10 is
VAT registration certificate of the complainant; Ex.P.11 is
letter dated 25.11.2019 addressed by DCB.Bank to the
complainant; Ex.P.12 is another cheque bearing
No.046465, allegedly drawn by C.Balakrishna Raju;
Ex.P.13 is bank endorsement dated 27.12.2014; Ex.P.14
and 15 are certified copies of letters dated 30.03.2014 and
06.01.2017, issued by Asst.Commissioner of Commercial
Taxes; Ex.P.16 and 18 are certified copies of vakalaths filed
in C.C.No.5627/2016, on behalf of the accused herein;
Ex.P.17 is letter dated 11.02.2021; Ex.P.19 and 20 are
certified copies of complaint/amended complaint in
PCR.No.8916/2017 filed by the complainant herein against
C.Balakrishna Raju; Ex.P.21 is certified copy of vakalath;
Ex.P.22 is certified copy of copy application; Ex.P.23 is
certified copy of memo filed in CC.No.12909/2013; Ex.P.24
is certified copy of memo dated 11.02.2021 filed in
CC.No.12909/2013; Ex.P.25 is certified copy of vakalath;
Ex.P.26 is letter dated 04.02.2023 addressed by IDBI
Bank; Ex.P.27 is legal notice dated 29.12.2014 issued by
the complainant to Indburg Infrastructures and two others;
Ex.P.28 to 30 are three postal receipts; Ex.P.31 to 33 are
postal track consignment report; Ex.P.34 is visiting card of
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Indburg Infrastructures; and Ex.P.35 is Sec.65(B)
certificate.
12. Learned counsel for the accused cross-
examined PW-1. It is elicited that complainant is a
proprietorship concern and Madhu Gupta @ Madhu Bansal
is its proprietrix. It was suggested that the accused never
had business transactions with the complainant. P.W-1
has denied the suggestion. He has admitted the suggestion
that in the legal notice issued by the accused, there is no
mention that the complainant is a proprietorship concern
and Madhu Gupta @ Madhu Bansal is its proprietori. PW-1
has denied the suggestion that he has no authority under
law to give evidence on behalf of the complainant. It is
elicited that PW-1 is an advocate by profession, practicing
since 1996. It is elicited that the complainant was
previously a HUF and at the time of filing of the complaint,
it is converted into proprietorship concern. It is elicited
that PW-1 has filed CC.No.5857/2016 on the file of
SCCH.12 against Balarrishna Raju, as HUF of the
complainant. Certified copy of the complaint was
confronted to PW-1 and the same is marked as D-1. It is
also elicited that in respect of the alleged outstanding of
₹11,75,391/- pertaining to the present complaint,
CC.No.5018/2015 was filed against the said C.Balakrishna
Raju on the file of 42nd ACMM by contending that he is the
guarantor. It is elicited that subsequently the said case
was transferred to 13th ACMM and it was dismissed for
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C.C.No.57067/2021
default. PW-1 has volunteered that he has filed appeal
against the order of dismissal.
13. P.W-1 has admitted that cheque bearing
No.309878 pertaining to CC.No.5857/2016 was also
presented DCB Bank Ltd, M.G.Road, Bengaluru. It is
elicited that CC.No.12909/2013 filed against
C.Balakrishna Raju, the guarantor, on the file of 25 th
ACMM was ended in acquittal on 30.05.2023. Certified
copy of the judgment in the said case was confronted and
the same is marked as Ex.D-2. PW-2 has asserted that he
has filed appeal against judgment of acquittal. He has also
admitted suggestion that another cheque bounce case filed
against C.Balakrishna Raju was also dismissed on
30.05.2023.
14. During cross-examination dated 22.03.2024,
PW-1 has admitted that he has not produced document to
show when did the accused purchase the materials from
the complainant. When a specific suggestion was given to
PW-1 to the effect that the accused has never placed order
to complainant for supply of materials, P.W-1 has asserted
that the accused personally came to the complainant to
place order orally. PW-1 has asserted that post-dated
cheque in question was issued by the accused after
purchasing the materials on 16.04.2014. When questioned
as to when did the guarantor the C.Balakrishna Raju
issued the cheque for the same memo, PW-1 has replied
that he had issued the cheque in September, 2014. He has
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C.C.No.57067/2021
denied the suggestion that old cheques in the possession of
the complainant were misused for the purpose of filing the
complaint. It was suggested that except the cheque, there
is no document to prove the alleged transaction. PW-1 has
denied the said suggestion.
15. It was argued on behalf of the complainant that
as per order dated 20.03.2018, this court has ordered to
try this case as summary trial. He has argued that the
offence under Section 138 of N.I.Act is a document based
offence and the burden is on the accused to prove that he
is not guilty. It was argued that the complainant is a
proprietorship concern, which can either sue in the name
of the proprietor or in its name. He has submitted that the
cheque at Ex.P-2 was dishonoured, vide bank endorsement
at Ex.P.3. It was further argued that after the dishonour of
the cheque, demand notice was issued to the accused as
per Ex.P.4 within the time stipulated in proviso (b) to
Sec.138. But, the accused has avoided the service. In this
regard, track consignment report is produced at Ex.P.6.
Attention of this court drawn to Ex.P.27 to submit that
another notice issued to the very accused to the very
address was served. Therefore, it was argued that the
accused has intentionally avoided the service of notice. It
was argued that the accused has not paid the cheque
amount to the complainant. It was argued that the accused
has not led defence evidence. Therefore, adverse inference
has to be drawn against the accused. While drawing
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attention of the court to 313 statement, it was submitted
that the accused has come up with an explanation that he
had given the cheque to contractor Balakrishna and he
does not know to PW.1. However, no suggestion was given
to PW.1 to that effect during his cross-examination. There
is no evidence to prove that the cheque in question was
issued to contractor by name Balakrishna. Therefore, he
has committed the offence under Section 138 of N.I.Act
and as such, he is liable for conviction.
16. Learned counsel for the complainant has relied
on the following judgments:-
1. Indian Bank Association and others Vs. Union
of India and others-[(2014) 5 SCC 590], where
Hon'ble Supreme court held-
"In summary trial, after the accused is
summoned, his plea is to be recorded
under Section 263(g) Cr.P.C and his
examination, if any can be done by a
Magistrate and a finding can be given
by the court under Section 263(h)
Cr.P.C and the same procedure can be
followed by a Magistrate for offence of
dishonour of cheque since offence under
Section 138 of the Act is a document
based offence. We make it clear that if
provisos (a), (b) and (c) to Section 138 of
the Act are shown to have been
complied with technically the
commission of the offence stands
completed and it is for the accused to
show that no offence could have been
committed by him for specific reasons
and defences."
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2. Meghmala and others Vs. G.Narasimha Reddy
and others-[(2010) 8 SCC 383], where Hon'ble
court has held-
"50. As per the provisions of Section 10
of the 1982 Act, the burden of proof is
on the accused to prove that he is not
guilty. Thus, it is not like any other
criminal case where the accused is
presumed to be innocent unless the
guilt is proved. The presumption of
innocence is a human right, however,
subject to the statutory exceptions, the
said principle forms the basis of
criminal jurisprudence. For this
purpose, the nature of offence, its
seriousness and gravity thereof has to
be taken into consideration. Statutes
like the Negotiable Instruments Act,
1881; the Prevention of Corruption Act,
1988; and the Terrorist and Disruptive
Activities (Prevention) Act, 1987, provide
for presumption of guilt if the
circumstances provided in those
statutes are found to be fulfilled and
shift the burden of proof of innocence
on the accused. Thus, the legislature
has adopted a deviating course from
ordinary criminal law shifting the
burden on the accused to prove that he
was not guilty."
3. Smita Subhash Sawanth Vs. Jagdeeshwari
Jagdish Amin and others-[(2015) 12 SCC 169],
where Hon'ble Supreme court held-
"31. It is a settled principle of rule of
interpretation that the court cannot
read any words which are not
mentioned in the section nor can
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substitute any words in place of those
mentioned in the section and at the
same time cannot ignore the words
mentioned in the section. Equally well-
settled rule of interpretation is that if
the language of a statue is plain,
simple, clear and unambiguous then
the words of a statute have to be
interpreted by giving them their natural
meaning. (see Principles of Statutory
Interpretation by G.P.Singh, 9th Edn.,
pp.44-45.) Our interpretation of Section
33(1) read with Section 28(k) is in the
light of this principle."
4. Suganthi Suresh Kumar Vs. Jagdeeshan-[(2002)
(1) SCR 269] where it was held that:-
"The total amount covered by the
cheques involved in the present two
cases was ₹4,50,000. There is no case
for the respondent that the said amount
had been paid either during the
pendency of the cases before the trial
court or revision before the High Court
of this Court. If the amounts had been
paid to the complainant there perhaps
would have been justification for
imposing a flee-bite sentence as had
been chosen by the trial court. But in
the case where the amount covered by
the cheque remained unpaid it should
be the look out of the trial Magistrates
that the sentence for the offence under
Section 138 should be of such a nature
as to give proper effect to the object of
the legislation. No drawer of the cheque
can be allowed to take dishonour of the
cheque issued by him light heartedly.
The very object of enactment of
provisions like Section 138 of the Act
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would stand defeated if the sentence is
of the nature passed by the trial
Magistrate. It is different matter if the
accused paid the amount atleast during
the pendency of the case."
5. Smt.Bhavani Vs. D.C.Doddarangaiah and
another-[(2002) Crl.L.J.3814], where Hon'ble High
Court of Karnataka held-
"7. A contention is raised in the revision
that it is mandatory on the part of the
Magistrate while convicting the accused
to impose a punishment of fine which
should be twice the amount of cheque.
This Court has relied upon the decision
in the case of B.Harikrishna V.Macro
Links Private Limited, Bangalore and
Anr., 2000(2) Kar.L.J.621:ILR 2000
Kar.2855 in support of the said
contention. The learned Single Judge
while hearing this matter, disagreed
with the view taken in the aforesaid
decision and therefore referred the
matter to the Division Bench.
Accordingly, the Division Bench after
hearing the parties, has now laid down
thus:
"It would be almost obligatory on the
part of the Trial Court when the case
has ended in a conviction to award a
compensation that would be
commensurated with the legal
principles of fair play and this in our
view having regard to the provision of
Section 117 of the Negotiable
Instruments Act, which should not be
less than the face value of the cheque,
the interest computed at 18% per
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annum and the costs that may be
computed by the Court. There is a
distinct reason why the Legislature has
provided for the upper limit of twice the
face value of the cheque the reason
being that having regard to the loss of
interest and the costs involved that if
the compensation or the fine were to be
limited to the face value of the 'cheque,
it could result in manifest injustice to
the aggrieved party and the wrong-doer
being benefited. In order to offset this
injustice, the Legislature has provided
for the upper limit of twice the face
value of the cheque and in our
considered view no Trial Court would be
justified in overlooking this important
aspect of law".
6. Kaushalya Devi Massand Vs. Roopkishore Khore
SC-[(2011) (3) SC 2566], where Hon'ble Supreme
court held-
"9. Having considered the submissions
made on behalf of the parties, we are of
the view that the gravity of a complaint
under the Negotiable Instruments Act
cannot be equated with an offence
under the provisions of the Indian Penal
Code or other criminal offences. An
offence under Section 138 of the
Negotiable Instruments At 1881 is
almost in the nature of a civil wrong
which has been given criminal
overtones.XXXXX"
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7. M/s Shree Daneshwari Traders Vs. Sanjay Jain.
AIR 2019 SC 4003], where Hon'ble Supreme court
held-
"17. It is for the accused to adduce
evidence of such facts and
circumstances to rebut the presumption
that such debt does not exist or that the
cheques are not supported by
consideration. Considering the scope of
presumption to be raised under Section
139 of the Act and the nature of
evidence to be adduced by the accused
to rebut the presumption, in Kumar
Exports v.Sharma Carpets (2009) 2 SCC
513, the Supreme Court in paras (14-
15) and paras (18-20) held as under:-
"14. Section 139 of the Act provides that
it shall be presumed, unless the
contrary is proved that the holder of a
cheque received the cheque for the
discharge, in whole or in part, of any
debt or other liability.
15. Presumptions are devices by use of
which the courts are enabled and
entitled to pronounce on an issue
notwithstanding that there is no
evidence or insufficient evidence. Under
the Evidence Act all presumptions must
come under one or the other class of the
three classes mentioned in the Act,
nemly, (1)"may presume"(rebuttable), (2)
"shall presume"(rebuttable), and (3)
"conclusive presumptions"
(irrebuttable). The term "presumption"
is used to designate an inference,
affirmative or disaffirmative of the
existence of a fact, conveniently called
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the "presumed fact" drawn by a judicial
tribunal, by a process of probable
reasoning from some matter of fact,
either judicially noticed or admitted or
established by legal evidence to the
sanctification of the tribunal."
8. Hon'ble High Court of Karnataka in the case M/s
Devi Tyres Vs. Sri.Nawab Jan - [Criminal Appeal
No.631/1995 (DD20.03.2000)], held-
"There is a presumption that when a
cheque is issued, that the amount is
payable and no criminal court is
required to embark upon any enquiry
that goes behind the act of issuance of
the cheque."
9. In Hiten P.Dalal Vs. Bratindranath Banerjee
[(2001) SCC 3897], Hon'ble Supreme court held-
"(B) Negotiable Instruments Act (26 of
1881), S.139, S.138-Dishonour of
cheque-Presumption that cheque was
drawn for discharge of liability of
drawer-Is presumption of law-Ought to
be raised by Court in every case-
Rebuttal evidence-Nature-Mere
plausible explanation is not sufficient-
Proof of explanation is necessary"
10. In K.N.Beena Vs. Muniyappan & another-
(2001) SCC 2895], Hon'ble Supreme Court held-
"Negotiable Instruments Act (26 of
1881), Ss.138, 139, 118-Cheque-
dishonour complaint-Burden of proving
that cheque had not been issued for any
debt or liability-Is on the accused-
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Denial/averments in reply by accused
are not sufficient to shift burden of
proof on to the complainant-Accused
has to prove in trial by leading cogent
evidence that there was no debt or
liability-"
11. Hon'ble High Court of Karnataka in the case of
Smt.B.Parijatha Vs Sri.T.B.Rudraswamy -
[Criminal Appeal No.1971/2017; DD 08.06.2023],
held-
"XXX When accused has not chosen to
send reply to the legal notice and having
regard to the fact that the cheque
belongs to the accused and signature
therein is not disputed by him, the trial
Court ought to have raised presumption
under Section 118 and 139 of the
N.I.Act that the cheque was issued in
discharge of legally recoverable debt or
liability. The trial Court has committed
serious illegality by placing burden on
the complainant to prove that the
cheque in question was issued by
accused towards discharge of legally
recoverable debt or liability."
12. Hon'ble High Court of Delhi in the case of
Rajesh Agarwal Vs State and Another
[Crl.M.C.No.1996/2010; DD 28.07.2010], held-
"xxxx It is thus obvious that in a trial of
an offence under section 138 N.I.Act the
accused cannot simplicitor say "I plead
not guilty" and wants to face trial. Since
offence under section 138 of N.I.Act is a
document based technical offence,
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C.C.No.57067/2021
deemed to have been committed
because of dishonour of cheque issued
by the accused or his company or his
firm, the accused must disclose to the
Court as to what is his defence on the
very first hearing when the accused
appears before the Court.XXX"
17. Now coming to the case on hand, where it is
evident from Ex.P.19/P-20 that PCR.No.8916/2017 filed by
the complainant herein against one C.Balakrishna Raju for
the offence under Section 138 of N.I.Act. It is pertinent to
note that the transaction alleged in the said complaint is
nothing but the transaction pertaining to the complaint on
hand. In the said complaint, the complainant herein has
asserted that said C.Balakrishna Raju stood as guarantor
for the materials worth ₹11,75,391/- supplied to the
accused herein. It is elicited in the cross-examination of
PW-1 that the said PCR.No.8916/2017 was dismissed for
default after it was transferred to the court of XIII ACMM.
However, PW-1 has asserted that he has filed appeal
against the said order of dismissal. But, no documents
produced to substantiate that the complainant has
challenged the order of dismissal of PCR.No.8916/2017 for
default. Nevertheless, the fact remains that
PCR.No.8916/2017 filed against the alleged guarantor
C.Balakrishna Raju was not disposed on merits. On the
contrary, it was dismissed for default. Therefore, the said
order of dismissal does not in any way affect the merits of
this case.
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18. In the present case case, the complainant is
alleging that it has supplied building materials worth
₹11,75,391/- to the accused on credit basis. It is true that
the complainant has not produced document to prove the
supply of materials to the accused. Accused has denied
supply of materials to him by the complainant. While
offering explanation during Sec.313 Cr.P.C, he has stated
stated that he has given the cheque to Contractor-
Balakrishna. However, no such suggestion given to PW-1
during cross examination to that effect. To substantiate the
said assertion, he has neither led defence evidence nor
brought out any circumstances in the cross examination of
P.W-1. Had really the accused issued the cheque to
Balakrishna and not to the complainant, nothing prevented
him from examining said Balakrishna before the court to
substantiate his defence. Therefore, there is hardly any
evidence to prove his contention that he has issued the
cheque in question to contractor Balakrishna. The accused
has not come up that definite case as to how the cheque
has gone to the hands of the complainant. Therefore, very
contention of the accused that he has issued the cheque to
C.Balakrishna Raju is not supported by any offence and
thus it cannot be believed.
19. At this juncture, it is necessary go through the
provisions contained in Section 118(a) and 139 of N.I.Act
which are extracted as under:
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"Sec.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 of transferred
for consideration.
"Sec,139. Presumption in fvour
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, or any debt or
other liability."
20. 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
contemplated under these two provisions are in favour of
the complainant. However, it is open to an accused to raise
a defence to rebut the statutory presumptions regarding
existence of legally enforceable debt or liability. It is also
well established that the 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 and the
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standard of proof so as to prove a defence on the part of
accused is preponderance of probabilities.
21. Section 138 of the Act provides that a drawer of a
cheque is deemed to have committed the offence if the
following ingredients are fulfilled:
(i) A cheque drawn for the payment of any
amount of money to another person;
(ii) The cheque is drawn for the discharge of
the "whole or part" of any debt or other
liability. "Debt or other liability" means legally
enforceable debt or other liability; and
(iii) The cheque is returned by the bank unpaid
because of insufficient funds.
However, unless the stipulations in the proviso are
fulfilled the offence is not deemed to be committed. The
conditions in the proviso are as follows:
(i) The cheque must be presented in the bank
within six months from the date on which it
was drawn or within the period of its validity;
(ii) The holder of the cheque must make a
demand for the payment of the "said amount of
money" by giving a notice in writing to the
drawer of the cheque within thirty days from
the receipt of the notice from the bank that the
cheque was returned dishonoured; and
(iii) The holder of the cheque fails to make the
payment of the "said amount of money" within
fifteen days from the receipt of the notice.
22. Admittedly, cheque at Ex.P.2 drawn in favour of
the complainant. The accused does not dispute his
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signature appearing on the cheque and handwriting
appearing thereon. Prima facie, all the writings appearing
on the cheque are in the same ink and writting. The said
cheque was drawn for ₹11,75,391/- and indisputably, it
was dishonoured for the reason 'funds insufficient', vide
endorsement at Ex.P.3 dated 05.05.2014.
23. After the receipt of intimation of dishonour of
the cheque from the bank, the complainant has issued a
demand notice dated 16.05.2014 as per Ex.P.4, calling
upon the accused to pay the dishonoured cheque amount.
The said notice was sent through registered post on
17.05.2014, vide postal receipt at Ex.P.5. As could be seen
from Ex.P.6, the postman attempted to deliver the notice to
the addressee/accused on several occasions between
19.05.2014 and 26.05.2014 by serving intimation(s). But,
the registered post could not delivered as 'door locked'. As
could be seen from visiting card of the accused produced at
Ex.P-7, address of the accused is 'Abbanakuppe, Near
Toyota Kirlosker, Bidadi Industrial Area'. It was to the very
address to which demand notice at Ex.P.4 was sent to the
accused. The contention that Ex.P-4 does not pertain to
the accused and that the complainant created the same, is
not substantiated by the accused. Therefore, I hold that
the complainant sent demand notice to the accused to his
address and the notice is deemed to be served.
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24. Of course, it is true that the complainant has
not produced documents to prove the supply of materials
to the accused as contended. But that does not by itself is
a ground to disbelieve the case of the complainant. It is a
known proposition of law that the offence 138 of N.I.Act is
a document based offence. If provisos (a) to (c) to Section
138 of the Act are shown to have been complied with
technically the commission of the offence stands completed
and it is for the accused to show that no offence could have
been committed by him for specific reasons and defences.
This proposition of law has been laid down by Hon'ble Apex
Court in Indian Bank Association case (supra). In the
case on hand, as noted above cheque at Ex.P.2 prima facie
shows that it was drawn in favour of the complainant for
₹11,75,391/- which is the amount due to the
complainant from the accused.
25. The defence of the accused is that one of the
cheques belonging to Balakrishna Raju has been misused.
The said Balakrishna Raju is said to be guarantor to the
materials supplied to the accused. It is not the case of the
accused that cheque at Ex.P.2 does not belong to him. On
the contrary, the accused himself admits that the said
cheque belongs to him. At the cost of repetition, it is again
reiterated that the accused has not examined said
Balakrishna Raju to prove his assertion. Nothing is
brought on record to substantiate the defence cheque at
Ex.P-2 was indeed given to said Balakrishna Raju. Having
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regard to the fact that cheque at Ex.P.2 belongs to the
accused and it was dishonoured for the reason 'funds
insufficient. The complainant having complied with the
proviso (a) to (c) of Section 138 of the Act, in view of the
dictum of Hon'ble Apex Court, the offence stands
completed. The accused has not made out any probable
defence so as to the exonerate him from the case. The
N.I.Act provides for presumption of the guilt of the accused
if the circumstances provided in those statutes are found
to be fulfilled and the burden of proof of innocence shifts
on the accused. In the case on hand, as noted above, the
accused has not discharged his burden.
26. Yet another defence of the accused is that the
complaint filed by the complainant herein against the
alleged guarantor Balakrishna Raju for the offence under
Section 138 of N.I.Act has been dismissed. In this
connection, he has relied on Ex.D-2, i.e., certified copy of
judgment passed in CC.No.12909/2013 filed by the
complainant against C.Balakrishna Raju. Upon perusal of
said judgment, it is forthcoming that the transaction
pertaining to the said complaint is altogether different. It is
nothing to do present complaint. Likewise, transaction
pertaining to complaint at Ex.D-1 is also nothing to do with
the present complaint. In both the complaints, the
complainant has asserted that it is supplied materials to
Balakrishna Raju on credit basis. In the present case, the
complainant is contending that it had supplied materials to
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the accused herein on credit basis. Therefore, documents
on Ex.D-1 and D-2 do not in any way help the accused.
Viewed from any angle this court is of the considered
opinion that the accused has failed to make out a probable
defence. On the contrary, the complainant has produced
sufficient evidence to substantiate that the cheque in
question was drawn by the accused in favour of the
complainant towards discharge of legally recoverable
debt/liability. Therefore, I answer Point No.1 in the
Affirmative.
27. Point No.2: Punishment prescribed for the
offence under Section 138 of Negotiable Instruments Act is
imprisonment for a period which may extend to two years
or with fine which may extend to double the amount of the
cheque or with both. Gravity of complaint under N.I.Act
cannot be equated with an offence under other penal
provision. The offence under Section 138 of N.I.Act is in the
nature of a civil wrong which has been given criminal
overtones. Cheque at Ex.P.2 was drawn way back in the
year 2014. The accused has deprived of the money to the
complainant which was rightfully due since 2014. Under
the circumstances, very object of enactment of provisions
like Sec.138 of N.I.Act would stand defeated if lesser fine is
imposed. Therefore, this court is of the considered opinion
it is a fit case to impose fine equal to the twice the amount
of the cheque. Considering the facts and circumstances of
this case, it is just and desirable to impose fine of
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₹23,50,782/- and out of the said amount, it is just and
proper to award a sum of ₹23,45,782/- as compensation
to the complainant as provided U/s 357(1) (b) of Cr.P.C
and the remaining sum of ₹5,000/- shall go to State. In
view of the discussions made while answering Point No.1, I
proceed to pass the following:
ORDER
Acting under Section 255(2) of Cr.P.C., accused is convicted for the offence punishable under Section 138 of Negotiable Instruments Act. He is sentenced to pay a fine of ₹23,50,782/-. In default to pay fine, he shall undergo simple imprisonment for a period of six months.
Out of the realized fine amount, a sum of ₹23,45,782/- is ordered to be paid to the complainant as compensation and the remaining sum of ₹5,000/- shall be remitted to State.
Bail bonds executed by accused shall stand cancelled.
Accused is entitled for a copy of this judgment free of cost which shall be supplied to him forthwith.
(Dictated to the Stenographer, transcript computerized by him, revised corrected and then pronounced by me in the open Court on 8th day of November, 2024) ( SANTHOSH S.KUNDER ) XIV Addl. C.J.M., Bengaluru.
26C.C.No.57067/2021 ANNEXURES List of witness examined for the Complainant:
PW.1 D.P.Gupta List of documents marked for the Complainant:
Ex.P.1 General Power of Attorney dated 28.03.2013 Ex.P.2 Cheque Ex.P.3 Bank endorsement Ex.P.4 Copy of legal notice Ex.P.5 Postal receipt Ex.P.6 Postal track consignment report Ex.P.7 Visiting card of Kumar Material Supplier Ex.P.8 & 9 CC of depositions in C.C.No.12908/2013 and C.C.No.12909/2013 Ex.P.10 VAT registration certificate of complainant Ex.P.11 Letter dated 25.11.2019 of DCB Bank Ltd.
Ex.P.12 Cheque bearing No.046465 Ex.P.13 Bank endorsement Ex.P.14 & 14 Certified copies of letter dated 30.03.2014 and
06.01.2017 issued by Asst. Commissioner of Commercial Tax, Bengaluru Ex.P.16 & 18 C.C of vakalaths filed in C.C.No.5627/2016 Ex.P.17 CC of letter dated 11.02.2021 submitted by the accused to XXV ACMM Court Ex.P.19 & 20 CC of complaint/amended complaint in PCR.No.8916/2017 Ex.P.21 CC of vakalath filed in C.C.No.12909/2013 Ex.P.22 CC of copy application filed in C.C.No.12909/2013 Ex.P.23 CC of memo filed in C.C.No.12909/2013 Ex.P.24 CC of letter dated 11.02.2021 submitted by Balakrishna Raju to XXV ACMM Court Ex.P.25 CC of vakalath filed in C.C.No.12909/2013 27 C.C.No.57067/2021 Ex.P.26 Letter dated 04.02.2023 written by IDBI Bank Ex.P.27 Legal notice dated 29.12.2014 Ex.P.28 to 30 Postal receipts-3 Ex.P.31 to 33 Postal track consignment reports-3 Ex.P.34 Business card of Indburg Infrastructures Ex.P.35 Sec.65(B) certificate List of witness examined for the defense: Nil List of documents marked for the defense:
Ex.D.1 Certified copy of private complaint and documents in CC No.5857/2016 Ex.D.2 Certified copy of judgment in C.C.No.12909/2013 XIV Addl.C.J.M., Bengaluru.