Bangalore District Court
Sri.Sagar vs Smt.Radhamma on 17 February, 2021
IN THE COURT OF XX ADDL.CHIEF METROPOLITAN
MAGISTRATE AT BENGALURU CITY
Dated this the 17th day of February 2021
PRESENT: KALPANA.M.S.,
B.Sc., LL.M.,
XX ADDL. C.M.M.
Bengaluru.
C.C.No.29190/2017
Complainant : Sri.Sagar,
S/o.K.G.Narasimhamurthy,
Aged about 26 years,
R/at No-2, Shivakrupa Nilaya,
2nd Cross, Brundavana Layout,
Mallasandra,
T.Dasarahalli,
Bengaluru - 560 073.
{ By C.R.Venkatesh- Advocate}
Vs.
Accused : Smt.Radhamma,
W/o Late.Revanna,
Aged about 44 years,
R/at No.1528, Shivanada Store,
13th Cross, Kalyana Nagar,
Pipeline Road, T.Dasarahalli,
Bengaluru - 560 057.
{ By M.Arun Kuamr- Advocate}
2 C.C.29190/2017
Offence complained : U/S. 138 of N.I. Act.,
Plea of accused : Pleaded not guilty
Final Order : Accused is Convicted
Date of Order : 17-02-2021
JUDGMENT
The complainant has filed this complaint under section 200 of code of criminal procedure read with section 142 of the Negotiable Instruments Act ( in short referred as "N.I. Act") against the accused alleging that, she has committed the offence.
02. The sum and substance of the complaint, is as follows;
The accused is the friend of complainant and well known to him from past five years. The accused's son is doing tours and travels business, since from four to five years. In the last week of March 2016, the accused had obtained hand 3 C.C.29190/2017 loan of Rs.3,00,000/- from the complainant for her urgent family legal necessities and agreed to repay the same within one year. At the time of receiving the aforesaid hand loan, the accused has handed over the property documents and address proof documents as security. Accused has not returned the money as agreed upon. After several demands and requests, towards discharge of her liability, accused has issued a cheque bearing No.182797 dated 26.09.2017 for Rs.3,00,000/-, drawn on Vijaya Bank, T.Dasarahalli Branch, Bengaluru. Complainant presented the said cheque for encashment through his banker i.e., Bank of India, Hesaragatta Road Branch, Bengaluru - 560 073 and the said cheque returned with an endorsement "Funds Insufficient", dated 17.10.2017. Thereafter, complainant got issued legal notice on 24.10.2017 to accused. The legal notice returned with shara as "not claimed". It is contended that, accused intentionally not maintained sufficient amount in her bank account to honour the cheque issued in favour of the 4 C.C.29190/2017 complainant towards discharge of legally enforceable debt. On these allegations, present complaint is filed.
03. After filing of complaint, this court perused the documents and taken cognizance for the offence punishable under section 138 of Negotiable Instrument Act, sworn statement of complainant was recorded. Being satisfied that there are prima-facie materials to proceed against accused, summons was issued. After appearance, accused enlarged on bail and plea was recorded as per section 251 of Cr.P.C. Accused has not stated the defence.
04. Learned Counsel for complainant prays to treat sworn statement as examination-in-chief and to consider the documents marked as Ex.P.1 to 5. The statement under section 313 of code of criminal procedure is recorded, read over and explained to the accused. The defence of the accused is total denial, but not let in oral evidence. Further, during the course of cross examination of the complainant, through 5 C.C.29190/2017 confrontation, accused marked a complaint in C.C.No.26621/2017 between Sri.Sagar Vs. Sri.B.S.Ramesh, as per Ex.D.1.
05. Complainant relied on the following citations;
1.AIR 2009 - SC -568 P.Venugopal Vs. Madan P.Sarathi
2. 2015(4) KCCR - 3938 Gurupadaswamy Vs. M.Partha
3. 2004(3) KCCR - 1816 L.Mohan Vs. V.Mohan Naidu
4. 2001 CRL.L.J.- 4647 Hiten P.Dalal Vs. Bratindranath Banerjee
5. 2017(2) AKR- 527 Arjun Vs. E.Shekar
6. AIR 2010 SC - 1898 Rangappa Vs. Mohan
7. (2015) 8 SCC - 378 T.Vasanthakumar Vs. Vijayakumari
8. Criminal Appeal No.508/2019 (Arising out of Special Leave petition Crl.No.1883 of 2018) Rohitbhai Jivanlal Patel Vs. State of Gujarat & Anr 6 C.C.29190/2017
9. AIR - 1999 SC - 3762 K.Bhaskaran Vs. Shankaran Vaidhyan Balan and another.
10. 2019 (2) Kar.L.R.717(SC) Uttam Ram Vs. Devinder Singh Hudan and Another
06. Heard the Learned Counsel for complainant and accused. Perused the written arguments filed on behalf of the complainant, accused, citations and materials on record.
07. The points that arise for my consideration are as follows;
POINTS
1. Whether the complainant proves that, accused issued a cheque bearing No.182797 dated 26.09.2017 for Rs.3,00,000/- towards discharge of her liability, which was returned unpaid on presentation and also not complied the notice issued by the complainant and thereby committed an offence punishable under section 138 of Negotiable Instruments Act?
2. What Order?
7 C.C.29190/2017
08. My answer to the above points is as follows;
1. Point No.1: In the affirmative
2. Point No.2: As per final order for the following;
REASONS
09. POINT No.1: Complainant has filed this complaint alleging that accused has committed offence under section 138 of N.I. Act. She pleads and asserts that, towards discharge of her liability, accused has issued a cheque bearing No.182797 dated 26.09.2017 for Rs.3,00,000/-. The said cheque came to be dishonoured on presentation. Complainant has issued notice within time stipulated calling upon the accused to pay the amount covered under cheque. Inspite of service of notice, accused has not paid the amount within 15 days, which gave raise cause of action to file this complaint. He further relied on the documents from Ex.P.1 to
5. This witness was subjected to cross examination.
10. In this scenario, let us scrutinize the documents relied by complainant in order to examine the compliance of 8 C.C.29190/2017 statutory requirements envisaged under section 138 of N.I. Act. Ex.P.1 is cheque dated 26.09.2017, the said cheque returned with an endorsement "Funds Insufficient". Ex.P.2 is bank endorsement dated 17.10.2017, Ex.P.3 is legal notice dated 24.10.2017, Ex.P.4 is postal receipt and Ex.P.5 returned postal cover. This complaint came to be filed on 30.11.2017. A careful scrutiny of the documents relied by the complainant goes to show that, statutory requirements of section 138 of N.I. Act is complied with and this complaint is filed within time. Thus, complainant relied on the statutory presumptions enshrined under section 118 read with section 139 of N.I. Act.
11. No doubt, the said presumptions of law are rebuttable in nature. The accused can take probable defence and rebut the presumption available to the complainant. Let us examine whether accused has successfully rebutted the presumptions of law. The defence of the accused emerged from the suggestions posed in the cross examination of the 9 C.C.29190/2017 complainant is that, the legal notice was sent to wrong address of the accused and the complainant has not produced documents to show his financial capacity during period of impugned transaction. Complainant is in the habit of misusing the cheques taken in-connection with finance transaction, which is evident from the similar complaint filed against one B.M.Ramesh for an amount of Rs.5,50,000/- as per Ex.D.1, which is marked through confrontation. On these contentions, accused sought for dismissal of the complaint and consequent acquittal.
12. In the back drop of the rival contentions, this court has given anxious consideration to the case papers. At the outset, accused has not disputed the cheque in question and the signature present on the said Ex.P.1-cheque either in the cross examination of PW.1 or leading defence evidence. Thus, the legal presumptions enshrined under section 118 read with section 139 of the NI Act, is available to the complainant. The said provisions lays down a special rule of evidence that, 10 C.C.29190/2017 unless contrary is proved, it shall be presumed, the complainant is the holder in due course of the cheque and it was issued for consideration. No doubt, the statutory presumptions are rebuttable in nature. In case, accused is successful in rebutting the presumptions by raising probable defence, the reverse onus shifts on the complainant to prove the contrary, that the accused is liable to pay the cheque amount and there exists legally enforceable debt.
13. This proposition of law is laid down by the Hon'ble High Court of Karnataka in the decision reported in ILR 2006 KAR 4672 - J.Ramaraj V/s Iliyaz Khan, wherein it is held that;
"Mere denial of issuing cheque would not be sufficient as it is time and again noted that once the cheque is issued duly signed by the petitioner, the presumption goes against him as per Sec.139 of the Negotiable Instruments Act."11 C.C.29190/2017
No doubt, said statutory presumptions are rebuttable in nature. It is for the accused to place cogent and probable defence to rebut the presumptions raised in favour of the Complainant.
14. To discharge the burden of rebuttal, accused has disputed the service of legal notice, more specifically disputing the address mentioned in the Ex.P.3- legal notice. It is worth to note that, except suggesting the complainant regarding issuance of legal notice to the wrong address, accused has not placed positive evidence to prove her correct residential address. That apart, Ex.P.5- returned postal cover does not reflects any such postal shara such as, insufficient address or wrong address or address not exists etc., Inturn, the postal department made a shara that, ' Door lock/ intimation delivered'. In the absence of evidence to the contrary, this court has no other option except believing the postal shara to hold that, legal notice was sent to the proper and correct address of the accused.
12 C.C.29190/2017
15. In this context, it is profitable to refer the decision reported in, 2002 Crl. LJ 1926 (Kar), Fakirappa Vs. Shiddalingappa, wherein it is held that;
" The only requirement for the service of demand notice is that, the notice should have been sent to the correct address of the drawer. Since the mode of service is not prescribed by the law, it can be sent either by registered post or under certificate of posting or otherwise. The expressions " Left, not known, ' not available in the house', 'house locked', 'shop closed' etc., are all synonyms. Therefore, if the address of the drawer is proved to be correct, even if the notice is returned with the above remarks, then the notice is deemed to have been served on the drawer."
In the present case, accused has not disputed her address mentioned in the legal notice. Hence, it can be taken that, there is deemed service of legal notice.
16. Further, it could be seen that, in spite of deemed service of legal notice, the accused has not taken steps to issue reply taking all these contentions. The act of the accused in not issuing reply at the earliest point of time immediately after 13 C.C.29190/2017 service of the legal notice is one of the strong circumstances in favour of the complainant. This proposition of the law laid down in the following decisions.
17. In decision reported in, 2007 CRI.L.J. (NOC) 520 (KER), in a case of Sanjeev P.R. V/s. Thriveni Credit Corporation, Thodupuzha & Another, wherein it is held that;
"(B). Negotiable Instrument Act (26 of 1881), S.138- Dishonour of cheque- Conviction- Validity-
Signature in cheque is admitted -
Notice of demand though duly received and acknowledged , did not evoke any reply......- Concurrent finding that complainant has succeeded in proving all ingredients of the offence punishable under section 138 - Conviction of accused proper."
Further, the decision reported in, 2006 CRI.L.J.1, in a case of Gorantala Venkateswara Rao. V/s. Kolla Veera Raghava Rao and another, it is held that; 14 C.C.29190/2017
"(B) Negotiable Instrument Act ( 26 of 1881), S.138 - Dishonour of cheque- Legally enforceable debt-
Failure of accused in giving reply to legal notice issued by complainant-
Is one of the strong circumstances to draw an inference that accused borrowed amount from complainant and cheque was issued towards part payment of legally enforceable debt."
From the ratio laid down in the aforesaid decisions it is clear that, non issuance of reply by the accused is fatal to his defence. As such, the defence taken by the accused is not acceptable.
18. Further, it is forthcoming from the records, particularly from the suggestions to the complainant in the course of cross examination that, accused has not whispered anything regarding how the disputed cheque reached the hands of the complainant. However, it can be inferred from the suggestion, complainant is in the habit of misusing the cheque issued in connection with financial transaction that, accused appears 15 C.C.29190/2017 to have issued the present cheque to the complainant in finance transaction only. But, accused has not placed any details about the finance or money transaction that she had with the complainant. It is to be noted that, section 106 Indian Evidence Act, places burden on the accused to prove the facts that are especially within his/her knowledge. For the reasons best known to her, accused has not placed iota of evidence or documents to show the finance transactions with the complainant. In the absence of cogent evidence to that effect, adverse inference could be drawn against the accused.
19. The accused has taken a bleak contention disputing the financial capacity of the complainant to lend amount muchless Rs.3,00,000/- in the present case. From the discussion made supra and in the light of the settled point of law, it is crystal clear that, when the complainant relies on the statutory presumptions, onus shifts on the accused to prove the contrary in order to rebut the presumptions. In case, accused successfully rebutted the statutory presumptions, the 16 C.C.29190/2017 revers onus shifts on the complainant to prove the impugned transaction in detail along with the existence of legally enforceable debt. In the present case, accused has neither placed any cogent evidence to rebut the claim of the complainant nor successful in eliciting material admissions from the mouth of the complainant to disbelieve his claim. Thus, by relying on the dictum laid down in the Rangapp's case, this court has no hesitation to hold that, the presumption enshrined under section 139 read with section 118 of NI Act, extends to the exists legally enforceable debt. It is also settled point of law that, complainant cannot be expected to prove the financial capacity in respect of transaction for meager amount. Above all, there is an admission attributable to the accused to that effect that, complainant is and was financially sound enough to enter into money transactions with others, which is forthcoming from the Ex.D.1- document relied by the accused. Nothing is stated in the written arguments filed on behalf of the accused to 17 C.C.29190/2017 disbelieve the claim of the complainant. Thus, this contention of the accused does not inspire the confidence of the court.
20. From the overall consideration of the evidence on record it is forthcoming that, accused has not taken probable defence to rebut the statutory presumption. Mere denial is not sufficient to discharge the onus shifted on accused. To fortify this opinion, it is proper to refer the decision reported in, 2001 CRI.L.J. 4647, in a case of Hiten P.Dalal V/s. Bratindranath Banerjee, wherein it is held that;
"(B) Negotiable Instrument Act ( 26 of 1881), Ss.139, 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.
Evidence Act (1 of 1872), Ss .114, 101- 104."
Further in another decision reported in, 2017(2) A.K.R. 527, Arjun Vs.E.Shekar, it is held that, 18 C.C.29190/2017 S. 138, 139- Presentation of lawful consideration- Rebuttal of - Burden of proving that cheque has not been issued for any debt or liability - is on accused - mere plausible explanation not sufficient to disprove complainant' s case.
From the gist of the ratio laid down in the above decisions, it is clear that, burden shift on the accused to rebut the statutory presumption through cogent evidence, which is not discharged by the accused in the present case.
21. Under the facts and circumstances of this case, it is profitable to refer the decisions of the Hon'ble Supreme Court of India reported in, AIR 2018 SUPREME COURT 3601, in a case of, T.P.Murugan (Dead) Thr.Lrs. V. Bojan, wherein it is held that;
" Negotiable Instruments Act (26 of 1881), Ss.118,138,139- Dishonour of cheque- Presumption as to enforceable debt- cheques allegedly issued by accused towards repayment of debt- Defence of accused that 10 cheques issued towards repayment of loan back in 1995-
Behavior of accused in allegedly issuing 19 C.C.29190/2017 10 blank cheques back in 1995 and never asking their return for 7 years, unnatural- Accused admitting his signature on cheques and pronote, presumption under S.139 would operate against him- Complainant proving existence of legally enforceable debt and issuance of cheques towards discharge of such debt- Conviction, proper".
In another decision reported in, AIR 2018 Supreme Court 3604, in a case of Krishna Rao Vs. Shankargouda, wherein it is held that;
"Negotiable Instruments Act (26 of 1881), Ss.138, 139-Dishonour of cheque- Presumption as to - Accused issuing cheque of Rs. 2 lacs towards repayment of loan to complainant - Said cheque dishonored on account of insufficiency funds- Complainant proving issuance of cheque having signatures of accused- Accused failing to rebut presumption raised against him and no evidence led by him in his support - Acquittal of accused by High Court in revisional jurisdiction on ground of doubt in mind of court with regard to existence of loan, improper- Accused, liable to be convicted".20 C.C.29190/2017
Moreover, in the latest judgment decided on 15 th March 2019, the Hon'ble Supreme Court of India, AIR 2019 Supreme Court 1876; Rohitbhai Jivanlal Patel V/s State of Gujarat & Another, it is observed in para 12 that;
" 12. For determination of the point as to whether the High Court was justified in reversing the judgment and order of the Trial Court and convicting the appellant for the offence under section 138 of the NI Act, the basic questions to be addressed to are two - fold: as to whether the complainant - respondent No.2 had established the ingredients of Sections 118 and 139 of the NI Act, so as to justify drawing of the presumption envisaged therein; and if so, as to whether the accused -appellant had been able to displace such presumption and to establish a probable defence whereby, the onus would again shift to the complainant?........"
It is further observed in 18.6 that;
" 18.6. The fact of the matter remains that the appellant could not deny his signatures on the said writing but attempted to suggest that his signatures were available on the blank stamp paper 21 C.C.29190/2017 with Shri Jagdishbhai. This suggestion is too remote and too uncertain to be accepted. No cogent reason is available for the appellant signing a blank stamp paper. It is also indisputable that the cheques as mentioned therein with all the relevant particulars like cheque numbers, name of bank and account number are of the same cheques which form the subject matter of these complaint cases. The said document bears the date 21.03.2007 and he cheques were postdated, starting from 01.04.2008 and ending 01.12.2008. There appears absolutely no reason to discard this writing from consideration...."
It is further observed in para No.19 that;
" 19. Hereinabove, we have examined in detail the findings of the Trial Court and those of High Court and have no hesitation in concluding that the present one was clearly a case where the decision of the Trial Court suffered from perversity and fundamental error of approach; and the High Court was justified in reversing the judgment of the Trial Court. The observations of the Trial Court that there was no documentary evidence to show the source of funds with the respondent to advance the loan, or that the respondent did not record the transaction in the form of receipt of even kachcha notes, or that there were inconsistencies in the statement of the 22 C.C.29190/2017 complainant and his witness, or that the witness of the complaint was more in know of facts etc. would have been relevant if the matter was to be examined with reference to the onus on the complaint to prove his case beyond reasonable doubt. These considerations and observations do not stand in conformity with the presumption existing in favour of the complainant by virtue of Sections 118 and 139 of the NI Act. Needless to reiterate that the result of such presumption is that existence of a legally enforceable debt is to be presumed in favour of the complainant. When such a presumption is drawn, the factors relating to the want of documentary evidence in the form of receipts or accounts or want of evidence as regards source of funds were not of relevant consideration while examining if the accused has been able to rebut the presumption or not. The other observations as regards any variance in the statement of complainant and witness; or want of knowledge about dates and other particulars of the cheques; or washing away of the earlier cheques in the rains though the office of the complainant being on the 8th floor had also been or irrelevant factors of consideration of a probable defence of the appellant....."
The ratio laid down in the cited decisions are aptly applicable to the case on hand.
23 C.C.29190/2017
22. The accused has taken a vague defence and not placed cogent evidence to prove the same. This aspect is discussed in detail in a decision reported in , 2014(4) AKR 98 between Sripad Vs.Ramadas M.Shet, Criminal Appeal No.2689 of 2009, wherein it is held that;
"Negotiable Instrument Act (26 of 1881), Ss.138,139, 118- Dishonour of cheque-Acquitted-Validity-Cheque issued by repay loan amount to complainant, was dishonoured-Specific defence -However, accused failed to rebut initial presumption under sections 118 and 119- Mere distorted version or mere taking up defence by It means that he is not liable to pay any amount- Are not sufficient to put back the burden on to the complainant-
Acquittal of accused- Not proper."
The ratio laid down in the cited decision is squarely applicable to the facts on hand.
23. That apart, as far as proof of existence of legally enforceable debt is concerned, it is profitable to refer the decision of larger bench of the Hon'ble Apex Court reported in, 24 C.C.29190/2017 Rangappa Vs. Mohan reported in AIR 2010 SC 1898 = 2010 AIR (SCW) 2946, Wherein their lordships pleased to observe that;
"In the light of these extracts, we are in agreement with the respondent-
claimant that the presumption mandated by section 139 of the Act does indeed include the existence of the legally enforceable debt or liability".
In view of the law laid by three judges bench of Hon'ble Apex Court, the presumption enshrined under section 139 of the N.I. Act is extendable to the existence of legally enforceable debt. Accused has not placed cogent material to rebut the said presumption. As such, this contention of the accused holds no water.
24. In this case plea of the accused was recorded as per section 251 of Cr.P.C. Accused pleaded not guilty. As per section 251 of Cr.P.C. accused has to state about his defence. Here, except pleading not guilty accused has not stated her defence at the time of recording plea. As per the decision 25 C.C.29190/2017 reported in AIR 2014 SC 2528 (Indian Bank Association V/s Union of India), Crl. Petition No.8943/2010 M/s.Mess Transgare Pvt V/s Dr .R. Parvathareddy and in Rajesh Agarwals case, Wherein, it is held that; " Accused cannot simply say " I am innocent " or " I pleaded not guilty ". The proposition of law laid down in the aforesaid decision is squarely applicable to the facts and circumstances of this case. As such, it cannot be taken that accused has rebutted the presumption of law enshrined under section 139 and 118 of N.I. Act, by mere pleading not guilty.
25. From the discussion made supra, it is clear that, accused has neither taken probable defence nor taken steps to prove the same. To put it other way, accused has not taken and proved probable defence to rebut the presumption of law available in favour of the complainant, envisaged under section 118 read with section 139 of N.I. Act. Accordingly, the case of the complainant is believable. Complainant has proved that, accused has intentionally not maintained sufficient 26 C.C.29190/2017 amount in his account to honour the disputed cheque. Hence, this point No.1 under consideration is answered in the affirmative.
26. POINT NO.2: In view of the reasons stated and discussed above, the complainant has proved the guilt of the accused punishable under section 138 of N.I. Act It is worth to note that, the offence is of the nature of civil wrong. Hence, it is proper to award sentence of fine, instead of awarding sentence of imprisonment. Hon'ble Supreme Court of India in a decision reported in, (2015) 17 SCC 368, in a case of H.Pukhraj Vs. D.Parasmal, observed that, having regard to the length of trial and date of issuance of the cheque, it is necessary to award reasonable interest on the cheque amount along with cost of litigation. The amount covered under the disputed cheque is Rs.3,00,000/-. The date of cheque is 26.09.2017. By considering all these aspects, this court is of the opinion that, it is just and proper to imposed fine amount of Rs.4,10,000/-. which includes 27 C.C.29190/2017 interest and cost of litigation, out of which compensation has to be awarded to the complainant. Accordingly, this court proceed to pass the following;
ORDER Acting under section 255 (2) of Criminal Procedure Code, accused is hereby convicted for the offence punishable under section 138 of Negotiable Instrument Act and sentenced to pay fine of Rs.4,10,000/- ( Rupees Four Lakhs Ten Thousand only). In default thereof accused shall undergo simple imprisonment for 1 (One) month.
Acting under section 357(1) (b) of code of criminal procedure, it is ordered that, Rs.4,00,000/- ( Rupees Four Lakhs only ), there from shall be paid to the complainant as a compensation, 28 C.C.29190/2017 remaining fine amount of Rs.10,000/-
( Rupees Ten Thousand only) is defrayed to the state for the expenses incurred in the prosecution.
The bail bond of the accused stands canceled.
Office to supply the copy of this Judgment to the accused immediately on free of cost.
{Dictated to the stenographer directly on computer, corrected and then signed by me and then pronounced in the open court on this 17 th day of February 2021}.
(KALPANA.M.S.) XX ACMM, Bengaluru.
ANNEXURE List of witnesses examined on behalf of complainant:
P.W.1 Sagar 29 C.C.29190/2017 List of documents produced on behalf of complainant:
Ex.P.1 Cheque Ex.P. 1(a) Signature of the accused Ex.P. 2 Bank endorsement Ex.P. 3 Copy of the legal notice Ex.P. 4 Postal receipt Ex.P. 5 Returned postal cover
List of witnesses examined on behalf of accused:
-Nil-
List of documents produced on behalf of accused:
Ex.D.1 Complaint in C.C.No.26621/2017 XX A.C.M.M., Bengaluru.