Bangalore District Court
Sri.B.Ramaiah vs Mallesh on 13 October, 2022
KABC030540002018
Presented on : 21-07-2018
Registered on : 21-07-2018
Decided on : 13-10-2022
Duration : 4 years, 2 months, 23 days
IN THE COURT OF XX ADDL.CHIEF METROPOLITAN
MAGISTRATE AT BENGALURU CITY
PRESENT: BHOLA PANDIT,
B.Com.,LL.M.,
XX ADDL. C.M.M.
Bengaluru.
Dated this the 13th day of October 2022
C.C.No.19956/2018
Complainant : Sri.B.Ramaiah,
S/o Byrappa,
Age 48 years,
R/at.No.45, Muneshwara Layout,
Doddabidarakallu, Nagasandra Post,
Bengaluru- 560 073.
{ By Sri.Hemant & Associates - Advocate }
2 C.C.19956/2018
Vs.
Accused : Mallesh,
S/o Ramanna,
Age 40 years,
R/at "Vigneshwara Layout",
Chikkasandra, Bone Mill,
T.Dasarahalli Post,
Bengaluru- 560 057.
{ By Sri.Harish.A.B - Advocate }
Offence complained : U/S. 138 of N.I. Act.,
Plea of accused : Pleaded not guilty
Final Order : Accused is Convicted
Date of Order : 13-10-2022
JUDGMENT
The present complaint is filed under section 2(d) read with section 200 of code of criminal procedure against the accused seeking to punish him for the offence punishable 3 C.C.19956/2018 under section 138 of the Negotiable Instruments Act ( in short referred as "N.I. Act").
02. The factual matrix of the complaint is summarized as under;
It is averred in the complaint that, the accused and complainant are well known to each other from past fifteen years. In view of the said relationship, the accused had requested the complainant to advance him hand loan of Rs.14,50,000/- to meet his personal commitments and to discharge the loan taken for constructing the house of accused from other persons. Therefore, on 06.01.2018 the complainant has advanced hand loan of Rs.14,50,000/- to the accused by way of cash and at that time, the accused has promised to repay the said amount along with interest at the rate of 12% per annum within three months. But, the accused failed to repay the said amount within the said period. On consistent demands and requests made by the 4 C.C.19956/2018 complainant, towards discharge of his liability, the accused has issued a cheque bearing No.024667 dated 10.05.2018 for a sum of Rs.14,50,000/- drawn on State bank of Mysore, Yeshwanthpur Branch, Bengaluru in favour of the complainant. The complainant has presented the said cheque for encashment through his banker, Vijaya bank, T.Dasarahalli Branch, Bengaluru, but it returned unpaid with banker's endorsement dated 16.05.2018 as "PRESENT WITH NEW A/C NUMBER" in the account of the accused. The same has been intimated to the accused on the very same day. On 23.05.2018, demand notice was issued to the accused by RPAD. The demand notice issued by RPAD has been returned on 25.05.2018 with a shara intimation delivered "Not claimed returned to sender". Inspite of service of legal notice, the accused neither has paid the cheque amount nor has given any reply. On these grounds, it is sought to convict the accused for the offence punishable under section 138 of 5 C.C.19956/2018 NI Act and grant compensation as per section 357 of Code of Criminal Procedure.
03. On presentation of complaint, this court has verified the averments of complaint along with records and thereby had taken cognizance for the offence punishable under section 138 of NI Act. Thereby, as per the verdict of the Hon'ble Apex court reported in AIR 2014 SC 1983 in the case of Indian Bank Association and others V/s Union of India and others, the sworn statement of the complainant has been recorded as PW.1 and got exhibited five documents at Ex.P.01 to 05. Having been made out the prima-facie case, the complaint has been registered in Register No. III and issued process against the accused.
04. In response to the summons, the accused put his appearance before the court through his counsel and filed bail application under section 436 of Code of Criminal 6 C.C.19956/2018 Procedure, the accused has been enlarged on bail. The substance of accusation has been recorded and read over to the accused, he pleaded not guilty and intends to put forth his defense. On filing application by the complainant under section 145(1) of NI Act, sworn statement of the complainant has been treated as examination in chief. Similarly, on filing application under section 145(2) of NI Act, the accused has been permitted to cross examine PW.1. On completion of the trial of the complainant's side, the statement of accused under section 313 of Code of Criminal Procedure has been recorded and read over to the accused, the incriminating material found in the trial of the case of the complainant. The accused has denied the same in toto and gave explanation stating that, he had issued cheque to the complainant, but not for that much of amount. The accused also wants to lead his defense evidence. Similarly, the accused has filed his evidence in the form of affidavit. As per the judgment of the Hon'ble High Court of 7 C.C.19956/2018 Karnataka in Cr.Pet.No.9331/2017 dated 02.07.2019 in the case of Vittal Sambrekar Vs. Manjunath, the accused is permitted to lead his defense evidence by way of affidavit. During cross examination of the PW.1, got exhibited six documents at Ex.D.1 to 6 on confrontation.
05. Heard the oral argument of Learned counsels for both the parties. Perused the materials available on record.
06. The following points that arise for my consideration are as under;
POINTS
1. Does the complainant proves beyond reasonable doubts that, the accused has issued a cheque bearing No.024667 dated 10.05.2018 for a sum of Rs.14,50,000/- towards the discharge of his lawful liability of the complainant and when the said cheque was presented for encashment, it was returned unpaid due to "Funds Insufficient" in the account of the drawer as per 8 C.C.19956/2018 banker's memo and inspite of issuance of demand notice , the accused has failed to pay the cheque amount, thereby has committed the offence punishable under section 138 of NI Act?
2. What Order or sentence ?
07. My findings 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
08. POINT No.1: It is the specific case of the complainant that, the accused had borrowed hand loan of Rs.14,50,000/- in cash from the complainant to meet hispersonal commitments and to discharge the loan taken for constructing the house of accused from other persons. Towards discharge of the said hand loan amount, the accused has issued the disputed cheque and when the said cheque was presented for encashment, it returned 9 C.C.19956/2018 unpaid due to "PRESENT WITH NEW A/C NUMBER" in the account of the drawer and inspite of receipt of demand notice, the accused has failed to make the payment of the cheque amount.
09. To substantiate and establish this fact before the court beyond reasonable doubts as per the verdict of the Hon'ble Apex court in the case of Indian Bank Association and others V/s Union of India and others , the sworn statement of the complainant has been treated as affidavit evidence. In his affidavit evidence, PW.1 has replicated the averments of the complainant. To corroborate the evidence of PW.1, the complainant has placed on record in all five documents as per Ex.P.01 to 05. Ex.P.1 is the disputed cheque dated 10.05.2018, Ex.P.1 (a) is the signature of accused, Ex.P.2 is the banker's memo dated 16.05.2018, which shows the reasons for the return of the cheque at Ex.P.1 for unpaid is as "PRESENT WITH NEW A/C 10 C.C.19956/2018 NUMBER", Ex.P.3 is the legal notice dated 23.05.2018 demanding for payment of cheque amount by replicating the averments of complaint, which was returned on 25.05.2018 with a shara intimation delivered "Not claimed return to sender". Ex.P.4 is the the postal receipt about sending legal notice at Ex.P.3, Ex.P.5 is the returned postal cover. PW.1 has been substantially cross examined by the counsel of accused.
10. To disprove the case of the complainant as well as to rebut the statutory presumption which could be drawn in favour of the complainant and also to prove the probable defense to the touch stone of preponderance of probabilities, the accused adduced his oral evidence before the court by way of filing his affidavit in the form of examination of chief as DW.1. In support of his oral evidence, the accused has produced before the court in all seven documents which are got marked through PW.1 by 11 C.C.19956/2018 making confrontation. The Learned counsel for the complainant has substantially cross examined DW.1 at length.
11. As per sections 118(a) & 139 of NI Act are two important provisions and they provides for raising mandatory presumptions in favour of the complainant until the contrary is proved by the accused. Even in the catena of decisions i.e., in the case of Rangappa Vs. Mohan reported in 2010(11) SCC 441, in the case of Bir Singh Vs. Mukesh Kumar reported in 2019(4) SCC 197, in the case of APS Forex Services (P) Ltd., Vs.Shakthi International Fashion Linkers reported in 2020(12) SCC 724, in the case of Rajeshbai Muljibhai Patel Vs. State of Gujarat, reported in 2020(3) SCC 794, in the case of Triyambak S. Hegde Vs. Sripad reported in Live Law 2021 SC 492 and it is laid down that, " Once the issuance of cheque and the signature thereon is admitted by the accused, the court is 12 C.C.19956/2018 required to raise presumption in favour of the complainant stating that, the accused has issued the cheque for some consideration towards discharge of his legal debt or liability of the complainant and that the complainant is the due holder of the said cheque. The burden shifts on the accused to rebut the statutory presumptions under sections 118(a) & 139 of NI Act." Now, it is well established law that, the presumption mandated by section 139 of NI Act, thus indeed includes the existence of legally enforceable debt or liability and it is open for the accused to raise a probable defense wherein the existence of legally enforceable debt or liability can be contested and he shall prove before the court on preponderance of probabilities, only thereupon a statutory presumption raised in favour of the complainant stands rebutted.
12. Before to appreciate the oral and documentary evidence relied by the complainant and accused, it is 13 C.C.19956/2018 necessary to know as to whether the present complaint is filed in consonance with the provisions of section 138 of NI Act. Further, on perusal of banker's endorsement at Ex.P.2 wherein the reason for dishonour of the cheque is mentioned as " Please present with new account number". The cheque under Ex.P.1 is belongs to State Bank of Mysore and as per the RBI Notification dated 01.04.2017, this state bank of Mysore has merged with State Bank of India along with other State Banks. Therefore, the present cheque at Ex.P.1 was issued on 10.05.2018 when the State Bank of Mysore was not in existence, therefore deliberately the cheque at Ex.P.1 was appears to have been issued, Therefore, the reasons shown in the memo at Ex.P.2 would attract section 138 of NI Act. During cross examination of PW.1 it was suggested that, the demand notice was not served upon the accused and by colluding with postal authorities it was made to file false report. Even in his evidence, the accused has denied the service of notice and 14 C.C.19956/2018 submitted that, he came to know about filing of this case only with the police authorities have informed him. In this regard, the Learned Prosecuting Counsel has cross examined DW.1 and in para No.1 of page No.8 in his cross examination DW.1 has clearly admitted that, his address shown in the notice and in the complaint are true and correct. Even on perusal of the postal cover at Ex.P.5, it reflects that, the said notice had returned to the complainant with a postal shara "Not Claimed", meaning thereby the notice sent to the accused on his proper and correct address. Therefore, as per section 27 of General Clauses Act, there is a deemed service of demand notice issued on the accused. In this regard, it is profitable to refer the decision reported in the Judgment of Hon'ble Apex Court in the case of State of MP Vs. Hiralal reported in 1996(1) J.T.(SC) 669, it is held that;
" The endorsements such as, " not available in the house" , "house locked", 15 C.C.19956/2018 "shop closed" and "left, not known" shall be taken as deemed services."
So in the case on hand, the RPAD returned at Ex.P.5 discloses "Not claimed" deemed service held sufficient. By considering the cheque, banker's memo, demand notice at Ex.P.3 and also the date of filing of complaint , I am of the considered opinion that, the present complaint filed in compliance of section 138 of NI Act.
13. In the case on hand, by looking to the defense of the accused during cross examination of PW.1 in para No.2 of page No.10 and also in his own evidence in para No.3 & 4 of affidavit, it is the defense of the accused that, the complainant was running chit business and the accused and other his friends have became the members of the chit transaction and himself has participated in the bid of the chit and obtained chit amount thricely and at that time, the complainant has taken from him the disputed cheque at Ex.P.1 as as security for the repayment of the chit bid 16 C.C.19956/2018 amount. Since, the accused has admitted the issuance of cheque and his signature thereon at Ex.P.1(a), it is imperative on the part of the court to raise legal presumption under section 118(a) & 139 of NI Act in favour of the complainant stating that, the accused has issued disputed cheque for some consideration towards the payment of debt or liability of the complainant and that the complainant is the due holder and payee of the said cheque. Now, the burden shifts on the accused to rebut the said statutory presumption raised in favour of the complainant by raising a probable defense and to prove the same on preponderance of probabilities. In the judgment of the Hon'ble Apex Court reported in Tedhi Singh Vs. Narayan Das Mahant, in Crl.Appeal No.362/2022 reported in 2022 Live Law (SC) 275, in para No.9, it is held that;
" If the accused takes his defense in the beginning itself by giving reply notice to the demand made by the 17 C.C.19956/2018 complainant, then burden of proof of the alleged transaction of loan lies upon the complainant."
In the instant case on hand, undisputedly the accused not given his reply notice to the demand made by the complainant as per Ex.P.3. Even, not at all raised his defense while at the time of recording his substance of accusation. Now, it is well settled law that, in order to rebut the statutory presumption under section 118(a) & 139 of NI Act which has been raised in favour of the complainant, the burden shifts on the accused to rebut the said statutory presumption by raising a probable defense and to prove the same on the touch stone of preponderance of probabilities and only thereupon the onus shifts on the complainant to prove the alleged transaction of loan and also the his financial capacity to lend the disputed loan amount. In his affidavit evidence, the accused has deposed that, in the year 2010 and 2011, he has became the member of the chit transaction runned by 18 C.C.19956/2018 the complainant and during the said period he has availed chit bid amount of Rs.1,00,000/-, Rs.2,00,000/- and Rs.3,00,000/- and for availing the subsequent two chit bid amount,the accused has given disputed cheque at Ex.P.1 as a security to the complainant and thereafter inspite of his making repayment of the chit amount, the complainant has failed to return the cheque at Ex.P.1. He further deposed that, the complainant was in the habit of getting security cheques from his chit fund members and thereby used to file cheque bounce cases. He further deposed that, the complainant has filed many cheque bounce cases against many persons. He deposed further that, he has not availed disputed loan amount from the complainant and he is not liable to pay the disputed cheque amount. In support of his oral testimony, the accused has placed on record the certified copies of two sale deeds marked at Ex.D.1 & 2, the certified copies of complaint, order sheet, cheque, vakalathnama and judgment, which are marked at 19 C.C.19956/2018 Ex.D.3 to 7. With reference to the documents at Ex.D.3 to 7, the Learned Defense Counsel has cross examined PW.1 at length about he filing those cases and in this regard PW.1 has admitted of his filing of those cases against those persons. With reference to these documents at Ex.D.3 to 7, the Learned Defense Counsel has argued that, the complainant is in the habit of filing cheque bounce cases. Therefore, he has sought to acquit the accused. The NI Act do not contemplates any specific provision in respect of the contention taken by the the Learned Defense Counsel. That apart, even section 138 of NI Act also do not prohibits filing of two or more cases by a single complainant in respect of any other cheque bounce cases. Therefore, I do not find any merit in the contention of the Learned Defense Counsel. Further, when the burden is shifted on the accused to establish and prove his probable defense, only after his successful discharge of the said burden, all the contentions of the accused will be considered and 20 C.C.19956/2018 appreciated. Except the oral testimony of DW.1 contending that, the complainant was running chit business and he was one of the member of the chit business, accordingly the cheque at Ex.P.1 was issued as a security document, the accused neither adduced the oral evidence of any witness who were the members of the chit business alleged to have been runned by the complainant. Even, the accused in his cross examination, himself has referred the name of some persons by name, Basavaraj, Mahadev, Mohan Kumar, Mariyappa and Doddaiah and also undertaken to adduce their evidence on his behalf. But they are not examined before the court in respect of his testimony. That apart, in order to establish his defense, when his defense is that, he has issued the disputed cheque to the complainant as a security in the year 2011, but he has not made any efforts to get back the said cheques either by filing police complaint or by issuing any notice to the complainant. That apart, while at the time of explaining the incriminating 21 C.C.19956/2018 evidence, the accused gave an explanation stating that, he has issued the cheque but not for that much of amount, for the sake of discussion the same is reproduced as under;
ಕ ಕಕಟಟರಕವದಕ ನಜ. ಆದರ ಅಷಕಟಷದಕ ಹಣ ಕಕಟಟಲಲ."
" ಚಕಕ By this explanation, the accused is admitting about his issuing cheque at Ex.P.1 for the repayment of hand loan amount as pleaded in the complaint. By considering these material evidences lacking on behalf of the accused, the self serving testimony of accused do not inspires my confidence to hold that, the accused has raised probable defense. Further, the accused has relying the judgment passed by this court in CC.No.8269/2018, which is marked ate Ex.D.6. On perusal of the findings of the said judgment it is observed by the court that, the reasons shown by the banker for the dishonour of the said cheque do not attracts the provisions of section 138 of NI Act and based on that findings, the accused in that case was acquitted. The findings of the judgment in CC.No.8269/2018 cannot be 22 C.C.19956/2018 applicable to the case on hand. Therefore, the accused has failed to raise probable defense and prove the same on preponderance of probabilities. Thus, the question of shifting the onus on the complainant does not arise. Accordingly, I answered point No.1 in the affirmative.
14. 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. 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
23 C.C.19956/2018
Negotiable Instrument Act and
sentenced to pay fine of
Rs.16,60,000/- (Rupees Sixteen
Lakhs Sixty Thousand only). In
default, he shall undergo simple
imprisonment for 6 (Six) months.
Acting under section 357(1) of
code of criminal procedure, it is ordered that an amount of Rs.16,50,000/-
( Rupees Sixteen Lakhs Fifty
Thousand only), there from shall be
paid to the complainant as a
compensation, remaining fine amount
of Rs.10,000/- (Rupees Ten
Thousand only) is defrayed to the
state for the expenses incurred in the
prosecution.
24 C.C.19956/2018
The bail bond of accused stands
canceled subject to appeal period.
Supply free copy of judgment to the
accused.
{Dictated to the stenographer, transcribed and computerized by her, revised corrected and then pronounced in the open court on this 13 th day of October 2022}.
(BHOLA PANDIT) XX ACMM, Bengaluru.
ANNEXURE List of witnesses examined on behalf of complainant:
P.W.1 B.Ramaiah List of documents produced on behalf of complainant:
Ex.P.1 Cheque
Ex.P. 1(a) Signature of the accused
25 C.C.19956/2018
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:
D.W.1 Mallesh List of documents produced on behalf of accused:
Ex.D.1 & 2 Sale deeds
Ex.D.3 to 7 Certified copies of complaint,
order sheet, cheque,
vakalathnama and judgment.
XX A.C.M.M.,
Bengaluru.