Bangalore District Court
Smt. Shivarathna vs Sri. Ramesh on 26 November, 2020
1
C.C.No.976/2019
IN THE COURT OF THE XVI ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE, BENGALURU CITY
Dated: This the 26th day of November, 2020
Present: Sri.S.B.HANDRAL, B.Sc., L.L.B(SPL).,
XVI Addl.C.M.M., Bengaluru City.
JUDGMENT U/S 355 OF Cr.P.C.,
Case No. : C.C.No.976/2019
Complainant : Smt. Shivarathna,
W/o. Raju,
Aged about 47 years,
Residing at No.53,
2nd Floor, 10th Cross,
1st Main Road, 1st Block,
Thyagarajanagar,
Bengaluru 560 028.
(By Sri. Suresha & D.Narayana
Shetty, Advs.,)
Vs
Accused : Sri. Ramesh,
Father's name Not known to
Complainant,
Aged about 42 years,
R/at No.116 & 117,
Block II, Kannali Village,
Kodigehalli Gramapanchayathi,
2
C.C.No.976/2019
Yashwanthpura Hobli,
Bengaluru North Taluk.
And also at :
N.R.Colony Fruits & Vegetable
Market,
Near Ambha Bhavani Temple,
Ramamandir Road,
N.R. Colony,
Bengaluru 560 019.
(By Manjunatha Kumar R.S
Adv .,)
Case instituted : 19.12.2018
Offence complained : U/s 138 of N.I Act
of
Plea of Accused : Pleaded not guilty
Final Order : Accused is convicted
Date of order : 26.11.2020
JUDGMENT
The Complainant has filed this complaint against the Accused for the offence punishable u/Sec.138 of the Negotiable Instruments Act.
2. Briefly stated the case of the Complainant is 3 C.C.No.976/2019 that, she and the accused are known to each other since several years and she and wife of the accused i.e. Smt. Varalakshmi were doing vegetables vending business since long time at N.R. Colony Fruit s & Vegetables Market, Bengaluru and the accused is running an Autorickshwa and also helping his wife in vegetable vending business and out of the relationship with the wife of the accused, during the first week of March 2017 the wife of the accused Smt.Varalakshmi has approached her and sought for financial assistance to the tune of Rs.4 Lakhs as the said amount is in shortage for construction of her house at Kannalil Village, Yashwanthpura Hobli, Bengaluru North Taluk. Thereafter the wife of the accused has availed a hand loan of Rs.4 Lakhs and the said amount was paid through account payee cheque to the wife of the accused on 13.3.2017 and the wife of the accused Smt. Varalakshmi has agreed to pay the interest at the rate of 2% p.m and also agreed to return the said hand loan amount within 21 months, for which the wife of the accused has issued a cheque bearing No.017416 drawn on 4 C.C.No.976/2019 Federal Bank, Visweswaraya Layout Branch, Bengaluru for the principal amount of Rs.4 Lakhs, but thereafter the wife of the accused has failed to pay the monthly interest payable to her, however the wife of the accused has agreed to pay the entire interest at one stretch. The Complainant further contended that, in view of her persistent requests and demands made for payment of arrears of interest to her, then the wife of the accused has paid part of the interest of Rs.30,000/ through account payee cheque on 28.5.2018 and agreed to clear off the remaining balance interest in the month of July 2018. Thereafter inspite of expiry of agreed period the wife of the accused did not bothered to clear off the principal amount and remaining interest, insptie of her persistent requests and demands made for returning for the same along with the interest i.e. for the total period of 21 months i.e. sum of Rs. 1,68,000/ by deducting the interest amount of Rs.30,000/ already paid i.e.Rs.1,38,000/ towards the arrears of interest, at that time the accused has agreed to pay the arrears 5 C.C.No.976/2019 of entire interest amount, accordingly he had issued cheque bearing No.388527 for sum of Rs.1,38,000/ drawn on Syndicate Bank, N.R. Colony branch, Bengaluru in her favour towards arrears of entire interest and as per the request of the accused, she has presented the said cheque for encashment through her banker, the same came to be dishonored with an endorsement of "Drawer's Signature Differs" on 23.11.2018, thereafter she got issued a legal notice dated: 1.12.2018 by way of RPAD to the two addresses of the accused, the same was received by the accused and caused an untenable reply on 13.12.2018. Hence she has filed this present complainant against the Accused for the offence punishable U/s.138 of Negotiable Instruments Act.
3. Before issuing process against the accused, the Complainant has filed her affidavitinlieu of her sworn statement, in which, she has reiterated the averments made in the complaint. In support of her evidence, P.W.1 has relied upon the documentary 6 C.C.No.976/2019 evidence as per Ex.P.1 to P10 i.e, Original Cheque dated: 23.11.2018 is as per Ex.P.1, the signature on the said cheque identified by P.W.1 as that of the accused as per Ex.P.1(a), the Bank memo as per Ex.P.2, the office copy of Legal Notice as per Ex.P.3, postal receipts as per Ex.P.4 and P.5 respectively, postal acknowledgements as per Ex.P.6 and P.7 respectively, Reply Notice as per Ex.P.8, complaint as per Ex.P.9, signature of the complainant as per Ex.P.9(a). Reply notice as per Ex.P.10 (Marked through DW.1).
4. Primafacie case has been made out against the accused and summons was issued against the accused in turn has appeared before the court and got enlarged on bail and the substance of the accusation has been read over to him, to which he pleaded not guilty and claims to be tried.
5. As per the direction of the Hon'ble Apex Court in the decision of the Indian Bank Association Vs., Union of India, reported in 2014 7 C.C.No.976/2019 (5) SCC 590, after recording the plea of the Accused, as she intended to set out her defence, then the case was posted for the cross examination of the complainant.
6. Thereafter, the statement of the accused as required under Sec.313 of the Cr.P.C. has been recorded. He has denied the incriminating evidence appearing against him and has chosen to lead his rebuttal evidence subsequently the Accused has examined as DW.1 and has not produced any documents on his behalf.
7. Heard by learned counsel for the complainant and the Accused and perused the written arguments submitted by the learned counsels for the complainant and the accused and materials on record.
8. On the basis of complaint, evidence of complainant and documents the following points that are arise for consideration are: 8 C.C.No.976/2019
1. Whether the complainant proves that the accused has issued cheque bearing No.388527 dated:
23.11.2018 for Rs. 1,38,000/ drawn on Syndicate Bank, N.R. Colony, Bengaluru to discharge legally recoverable debt to the complainant and when the complainant has presented cheque for encashment through her banker but the said cheque has been dishonoured for the reasons Drawer's Signature Differs" on 23.11.2018 and the complainant issued legal notice to the accused on 1.12.2018 and inspite of it the accused has not paid the cheque amount within prescribed period there by the accused has committed an offence U/s.138 of the Negotiable instruments Act?
2. What Order?
9. The above points are answered as under:
Point No.1: In the Affirmative Point No.2: As per final order for the following:9
C.C.No.976/2019 .
REASONS
10. Point No.1: Before appreciation of the facts and oral and documentary evidence of the present case, it is relevant to mention that under criminal jurisprudence prosecution is required to establish guilt of the Accused beyond all reasonable doubts however, a proceedings U/s.138 of N.I.Act is quasi criminal in nature. In these proceedings proof beyond all reasonable doubt is subject to presumptions as envisaged U/s.118, 139 and 136 of N.I.Act. An essential ingredient of Sec. 138 of N.I.Act is that, whether a person issues cheque to be encashed and the cheque so issued is towards payment of debt or liability and if it is returned as unpaid for want of funds, then the person issuing such cheque shall be deemed to have been committed an offence. The offence U/s.138 of N.I. Act presupposes conditions for prosecution of an offence which are as under:
1. Existence of legally enforceable debt or liability and issuance of cheque in 10 C.C.No.976/2019 discharge of said debt or liability;
2. Cheque shall be presented for payment within specified time i.e., from the date of issue before expiry of its validity.
3. The holder shall issue a notice demanding payment in writing to the drawer within one month from the date of receipt of information of the bounced cheque and
4. The drawer inspite of demand notice fails to make payment within 15 days from the date of receipt of such notice.
If the above said conditions are satisfied by holder in due course gets cause action to launch prosecution against the drawer in respect of bounced cheque and as per Sec.142(b) of the N.I. Act, the complaint has to be filed within one month from the date on which cause of action arise to file complaint.
11. It is also one of the essential ingredient of Sec. 138 of N.I.Act that, a cheque in question must 11 C.C.No.976/2019 have been issued towards legally recoverable debt or liability. Sec. 118 and 139 of N.I.Act envisages certain presumptions i.e., U/s.118 presumption shall be raised regarding 'consideration' 'date' 'transfer' 'endorsement' and holder in course of Negotiable Instrument. Even Sec.139 of the Act are rebuttable presumptions shall be raised that, the cheque in question was issued regarding discharge of a legally recoverable or enforceable debt and these presumptions are mandatory presumptions that are required to be raised in cases of negotiable instrument, but the said presumptions are not conclusive and are rebuttable one, this proportion of law has been laid down by the Hon'ble Apex Court of India and Hon'ble High Court of Karnataka in catena of decisions.
12. In the present case the complainant in her complaint and affidavit evidence has testified that, she and the accused are known to each other since several years as she and wife of the accused i.e. Smt. Varalakshmi were doing vegetables vending 12 C.C.No.976/2019 business since long time at N.R. Colony Fruit s & Vegetables Market, Bengaluru and the accused is running an Autorickshaw and also helping his wife in vegetable vending business and out of the relationship with the wife of the accused, during the first week of March 2017 the wife of the accused Smt.Varalakshmi has approached her and sought for financial assistance to the tune of Rs.4 Lakhs as the said amount is in shortage for construction of her house at Kannalil Village, Yashwanthpura Hobli, Bengaluru North Taluk. The complainant/Pw.1 further testified that, the wife of the accused has availed a hand loan of Rs.4 Lakhs and the said amount was paid through account payee cheque to the wife of the accused on 13.3.2017 and the wife of the accused Smt. Varalakshmi has agreed to pay the interest at the rate of 2% p.m and also agreed to return the said hand loan amount within 21 months, for which the wife of the accused has issued a cheque bearing No.017416 drawn on Federal Bank, Visweswaraya Layout Branch, Bengaluru for the principal amount of Rs.4 Lakhs, but thereafter the 13 C.C.No.976/2019 wife of the accused has failed to pay the monthly interest payable to her, however the wife of the accused has agreed to pay the entire interest at one stretch. The Complainant further testified that, in view of her persistent requests and demands made for payment of arrears of interest to her, then the accused's wife has paid part of the interest of Rs.30,000/ through account payee cheque on 28.5.2018 and agreed to clear off the remaining balance interest in the month of July 2018 at one stretch. Thereafter inspite of expiry of agreed period the wife of the accused did not bothered to clear off the principal amount and remaining interest, insptie of her persistent requests and demands made for returning for the same along with the interest i.e. for the total period of 21 months i.e. sum of Rs. 1,68,000/ by deducting the interest amount of Rs.30,000/ already paid i.e., Rs.1,38,000/ towards the arrears of interest, at that time the accused has agreed to pay the entire interest amount accordingly he had issued cheque bearing No.388527 for sum of Rs.1,38,000/drawn on Syndicate Bank, N.R. Colony 14 C.C.No.976/2019 branch, Bengaluru towards arrears of entire interest and as per the request of the accused, she has presented the said cheque for encashment through her banker, the same came to be dishonored with an endorsement of "Drawer's Signature Differs" on 23.11.2018, thereafter she got issued a legal notice dated: 1.12.2018 by way of RPAD to the two addresses of the accused, the same was received by the accused and caused an untenable reply on 13.12.2018.
13. In support of the oral evidence of the complainant, she produced and marked the documents as per Ex.P.1 to P.10 i.e. Original Cheque dated: 23.11.2018 is as per Ex.P.1, the signature on the said cheque identified by P.W.1 as that of the accused as per Ex.P.1(a), the Bank memo as per Ex.P.2, the office copy of Legal Notice as per Ex.P.3, postal receipts as per Ex.P.4 and P.5 respectively, postal acknowledgements as per Ex.P.6 and P.7 respectively, Reply Notice as per Ex.P.8, complaint as per Ex.P.9, signature of the 15 C.C.No.976/2019 complainant as per Ex.P.9(a). reply notice as per Ex.P.10 (Marked through DW.1).
14. In the present case, there is no dispute between the complainant and Accused with regard to their acquaintance. It is also not in dispute that, the cheque in question i.e. Ex.P.1 to belongs to the account of the accused, but the Accused has disputed his signature found at Ex.P.1(a). It is also not in dispute by the Accused that, the cheque in question presented for encashment and dishonoured for the reason of "Drawer's Signature Differs" on 23.11.2018, since as matter on record, proved by return memo dated: 23.11.2018 i.e. Ex.P.2 issued by the concerned bank, therefore it is a matter on record and has been proved that, the cheque in question was presented within its validity period and dishonoured as per the bank endorsement issued by the banker of accused. It is also not in dispute that, after dishonour of the cheque in dispute and receipt of bank memo within 30 days from the date of receipt of bank memo, a legal notice was caused as per 16 C.C.No.976/2019 Ex.P.3 to the Accused calling upon him to pay amount covered under the dishonoured cheque. The Accused has also not disputed service of the legal notice upon him as he was issued reply to the legal notice issued by the complainant as per Ex.P.8. Hence, the complainant has complied the mandatory requirements as required U/s.138(a) to (c) of Negotiable Instruments Act.
15. It is the specific defence of the Accused that, he has not borrowed any amount from the complainant and has not issued the cheque in question towards discharge of arrears of interest amount of Rs.1,38,000/ as claimed by the complainant. It is also the defence of the accused that, the complainant has collected blank unsigned cheque from him and has forged his signature on the cheque and presented the said cheque to the bank for that reason the cheque in question dishonoured for the reason of "Drawer's signature Differs". On the other hand, the complainant claimed that, the accused's wife has borrowed a loan amount of Rs.4 17 C.C.No.976/2019 Lakhs from her for the purpose of construction of house and agreed to repay the said loan amount within 21 months and also agreed to pay the interest at the rate of 2% p.m. on the loan amount but the wife of the accused has not paid interest amount, thereafter she approached her and requested to pay the loan amount along with interest at that time the accused's wife has agreed to pay entire interest amount at one stretch and also paid Rs.30,000/ towards part of the interest amount through account payee cheque on 28.5.2018 by agreeing to repay the remaining balance interest amount in the month of July 2018 and thereafter the accused's wife did not paid the interest amount as agreed by her and she requested to pay the loan amount with interest at that time the accused has agreed to pay entire interest amount for total period of 21 months of Rs.1,38,000/ by deducting Rs.30,000/ interest amount out of Rs.1,68,000/ for which the accused has issued the cheque in question for Rs.1,38,000/ in her favour and the said cheque has been presented to the bank and same has been 18 C.C.No.976/2019 dishonoured for reason of "Drawer's Signature Differ". Hence on this back ground the oral and documentary evidence of the Complainant and accused has to be examined.
16. On careful perusal of the oral and documentary evidence produced by the complainant and admitted facts by the accused in her defence i.e Ex.P.1 to P.8 it appears that, according to the complainant, the wife of the accused approached her in the first week of March 2017 seeking loan for the purpose of construction of house, accordingly the wife of the accused availed loan of Rs.4 Lakhs from her and she has paid the said amount through account payee cheque to the wife of the accused on 13.3.2017 and at that time the accused's wife has agreed to pay interest at the rate of Rs. 2% p.m. and also agreed to repay the entire loan amount within 21 months along with entire interest and also issued Ex.P.1 cheque towards the repayment of the principal amount. It is also seen from the admitted facts of the accused in his reply notice dated :
19C.C.No.976/2019 13.12.2018 i.e, Ex.P.8 and in his crossexamination that, the accused has clearly admitted that, his wife has borrowed a loan of Rs.4 Lakhs from the complainant for construction of house.
17. In addition to the above, it is a relevant here to refer that, the accused during the course of recording of his statement U/s .313 of Cr.P.C. has admitted certain facts while answering to the questions framed by the court i.e. the accused has clearly admitted that, his wife by name Smt. Varalakshmi has received a hand loan of Rs.4 Lakhs from the complainant on 13.3.2017 through account payee cheque and also admitted that, his wife has agreed to pay the interest on the loan amount but the accused denied the rate of interest by contending that, his wife agreed to pay interest of 5% p.m on the loan amount, but no documents have been produced by the accused, in such circumstances it can be held that, the accused has also admitted that, his wife availed loan from the complainant by agreeing to repay the said amount 20 C.C.No.976/2019 with interest as claimed by the complainant. It is also admitted that, the cheque in question was presented by the complainant through her banker and same was dishonoured as "Drawer's signature Differs" and also admitted that, after dishonour of the cheque the complainant got issued the legal notice through RPAD and same has been received by him. Hence, the admissions of the accused during the course of recording of the statement makes it clear that, the accused has clearly admitted the receipt of loan amount of Rs.4 Lakhs from the complainant by his wife for the purpose of construction of house and also agreed to pay interest to the complainant at the rate of 2% p.m.
18. It is the specific defence of the Accused that, the signature found on the disputed cheque i.e Ex.P.1(a) is not of his signature and the complainant by misusing the cheque has filed this false complaint against him. The Accused except the denial of his signature nothing has been placed before this court to show that, the signature found on the cheque i.e. 21 C.C.No.976/2019 Ex.P.1(a) is not of his signature, therefore mere denial is not sufficient to hold that, the signature found on the disputed cheque is not of his signature.
In this regard, it is a relevant here to refer the decision of Hon'ble Apex Court of India reported in 1999 (3) SCC 376 in the case of "L.C. Goyal Vs. Suresh Joshi (Mrs) and others"., wherein the Hon'ble Apex Court held that " Drawer denied his signature on the cheque and pleaded that, he could not be held responsible unless opinion of handwriting expert was obtained, but when cheque was bounced for want of fund, the plea of forged signature cannot be accepted". It is true that, the cheque in dispute has been dishonoured for the reason "Drawers signature differs" but it is not the defence of the Accused that, as on the date of presentation of the cheque he was having sufficient funds in the bank to honour the disputed cheque and the Accused has not produced any document to show that, as on the date of presentation of the cheque he was having sufficient balance amount in 22 C.C.No.976/2019 his bank account and if the cheque was presented and same will be honoured, in such circumstances, though the cheque in dispute dishonoured for the reason of "Drawer signature differs" it cannot be held that, the Accused was having sufficient funds in his account, as on the date of presentation of the cheque for encashment, therefore the defence taken by the Accused that, the complainant has misused the cheque by forging his signature cannot be acceptable one. In this regard it is a relevant here to refer the decision of Hon'ble Supreme Court of India reported in (2012) 13 Supreme Court Cases 375 in the case of Laxmi Dyechend Vs. State of Gujarat and Others., wherein the Hon'ble Apex Court held that " A. Debt, Financial and Monetary Laws Negotiable Instruments Act, 1881 Ss.138 and 143 Applicability dishonour of cheque on ground that signatures of drawer did not match specimen signatures available with the bank Endorsement "Drawer's signature differs from specimen supplied" and/or " no image found 23 C.C.No.976/2019 signature" and/or "incomplete signature/ illegible" on return/ dishonour of cheque, held, attracts S. 138 plea for strict construction of penal provison under S.138 where dishonour necessarily constitutes an offence for only one of the two contingencies envisaged under the provision, rejected - Words "amount of money standing to the credit of that account is insufficient to honour the cheque", interpreted hence, dishonour on ground that the payment has been stopped, regardless whether such stoppage is with or without notice to the drawer, and regardless whether stoppage of payment is on ground that amount lying in the account was not sufficient to meet the requirement of the cheque, attracts S. 138 - High court orders set aside trial Court directed to proceeed with the trial of the complaints filed by the appellant interpretation of Statutes Basic Rules Mischief rule/heydon's rule - Heydon's rule when to be 24 C.C.No.976/2019 preferred to strict interpretation. Therefore in view of the principles of law laid down by the Hon'ble Apex Court of India even though the cheque dishonoured for the reason such as "Drawer's signature Differ would also constitute a dishonour within the meaning of Sec.138 of NI Act.
19. Apart from that, the Accused has not made any efforts to examine the bank manager to show that, signature found at Ex.P.1(a) cheque is not of his signature, since the burden of proving is upon the Accused as he has denied the signature in his defence , therefore mere denial of the signature of the Accused on the cheque is not sufficient to hold that, the signature found at Ex.P.1(a) is not the signature of the Accused. The banker of the Accused is more competent person to say whether it is the signature of the Accused or not, by referring the specimen signatures of the Accused. In the instant case, though the banker of the Accused mentioned that, Drawer's signature differs but the Accused has not examined the bank manager to prove his defence 25 C.C.No.976/2019 that, signature found at Ex.P.1(a) is not of his signature by referring the specimen signatures maintained by his banker, on this ground also the defence taken by the Accused cannot be acceptable one. It is also important to note here that, the cheque in question is with the possession of the complainant but the Accused has not produced any evidence to show that, how the cheque in question came or entered into the hands of complainant, in such circumstances it is also one of the strongest circumstances to corroborate that, the signature found on the cheque i.e. Ex.P.1(a) is that of the Accused and it can be held that, the possession of the cheque with the complainant suggest an inference of endorsement and delivery inchoate instrument which impliedly admits the issuance of the cheque in favour of the complainant. This proposition of law finds supports from the decisions of Hon'ble High Court of Karnataka in 2010(I) KCCR 176 in the case of Siddappa Vs. Manjappa and in another decision of Hon'ble Apex Court of India 26 C.C.No.976/2019 decided in Crl.Appeal No.664/2012 dated:
19.9.20198 in the case of " M.Abbas Haji Vs. T.M.Channakeshava" wherein it is held that " the Accused has to explain how the cheque entered into the hands of complainant'. Hence in the present case also the Accused has failed to explain how and in what circumstances the cheque in question was entered into the hands of the complainant by producing cogent and convincible evidence. Therefore the denial of the signature by the Accused is only self serving denial of his signature that cannot be a good defence to come to conclusion that, signature found at Ex.P.1(a) is not that of the Accused, the complainant discharge his initial burden that the signature found at Ex.P.1(a) is that of the Accused.
. 20. It is also relevant here to mention that, the accused in his reply I.e Ex.P.8 specifically contended that, he has not issued any cheque to the complainant to clear the interest amount but the 27 C.C.No.976/2019 cheque in question was in the possession of his wife and the complainant forcibly taken the cheque from his wife and has presented the said cheque by forging his signature on the cheque , therefore the banker has issued shara that, signatures differ which is correctly mentioned by the bank, but whereas in his evidence before the court he has stated that, the complainant has collected his blank unsigned cheque and same has been presented to the bank for encashment by forging his signature. Hence on combined reading of the defence taken by the accused in his reply and in his evidence, goes to show that, the accused at one breath contended that, the cheque in question was in the possession of his wife and same has been forcibly taken by the complainant from his wife and another breath in his evidence contended that, the complainant has collected his blank unsigned cheque, therefore on this ground only an adverse inference can be drawn against the accused that, though the cheque in question was issued to the complainant but only for the purpose of evading his liability for discharging of 28 C.C.No.976/2019 the debt i.e. interest amount as claimed by the complainant in this complaint, the accused purposely and falsely deposing before the court as the signature found at Ex.P.1(a) is not of his signature and the accused has miserably failed to prove the possession of the cheque i.e. how the cheque has entered into the hands of complainant. If really the complainant forcibly taken away his cheque , definitely the accused would have stated the same thing in his evidence but contrary to it, has taken new defence in his evidence, therefore the version of the accused cannot be acceptable one i.e., it cannot be held that, complainant has forcibly taken the cheque in question from the possession of the accused's wife and forged the signature of the accused and presented the said cheque to the bank for its encashment and therefore the cheque in question got dishonoured for the reason of "Drawer's signature differs" . It is also relevant here to mention that, the complainant has produced the reply given by the wife of the accused to her which is at Ex.P.10 and the perusal of the Ex.P.10 wherein she nowhere 29 C.C.No.976/2019 stated that, the complainant has forcibly taken the cheque in question from her possession, hence if really as per the defence of the accused the cheque in question was forcibly taken by the complainant from the hands of his wife definitely she would have mentioned the same thing in her reply notice, but no such thing forthcoming in the reply notice given by the accused's wife , in such circumstances also it can be held that, for the purpose of avoiding liability to pay the interest amount to the complainant the accused has taken false defence and same cannot be accepted.
21. It is relevant here to mention that, as it is already held in the above that, the complainant proved that the cheque in question i.e Ex.P.1 belongs to the Accused and the cheque in question was presented within its validity period and the same was dishonoured for the reason of "Drawers Signature Differs" as per Ex.P.2 and thereafter the legal notice caused by him through RPAD to the Accused and the said notice was served on him and 30 C.C.No.976/2019 the Accused issued reply by denying the claim made by the complainant in the legal notice, in such circumstances, it can be held that, the complainant has discharged her initial burden by complying the mandatory requirements as required U/s.138 of N.I. Act and initially the presumptions are available in favour of the complainant U/s.118a and 139 of the N.I. Act. Consequently it is for the Accused to rebut the said presumptions available in favour of the complainant to show that, the cheque in question was not issued either to the complainant or towards discharge of any legally recoverable debt by producing cogent and convincible evidence but not mere suggestions or even by plausible explanation. In such circumstances, when the presumptions U/s.118 and 139 of N.I.Act are available to the complainant, even the said presumption can be drawn to the extent of existence of legally recoverable debt or liability against the Accused, unless and until the said presumptions are rebutted by the Accused even the documents are not produced by the complainant with regard to loan transaction in 31 C.C.No.976/2019 question. In this regard, it is relevant here to refer the decisions reported in 2001 AIR Karnataka HCR 2154 between 'M/s.Devi Tyres V/s.Navab Jan' and in 2011 ACD 1521 (KAR) between 'Smt. Usha Suresh V/s. Shashidharn', in 2010 SC 1898 between 'Rangappa Vs. Mohan' and 2011 ACD 1412 (KAR) between 'N.Hasainar Vs. M.Hasainar, S/o. Ibrahim'. The Hon'ble High Court of Karnataka in the above decision i.e., 2001 AIR Karnataka HCR 2154 at para No.6 was pleased to hold that issuance of cheque itself was adequate proof of existence of debt or liability. In another decision of Hon'ble Apex Court of India i.e. Hon'ble Three Judges Bench Decision reported in (2010) 11 SCC 441 in the case of Rangappa Vs. Sri. Mohan ., wherein the Hon'ble Apex Court held that "
A. Negotiable Instruments Act, 1881 - S.139 - Presumption under - scope of - Held, presumption mandated by S. 139 includes a presumption that there exists a legally 32 C.C.No.976/2019 enforceable debt or liability - However such presumption is rebuttable in nature - Criminal Trial - Proof - Presumptions - Generally. Further held that "Signature on the cheque was his, statutory presumption under S.139 comes into play and the same was not rebutted even with regard to the materials submitted by complainant Appellant not able to prove "lost cheque" theory - Apart from not raising a probable defence appellant was also not able to contest the existence of a legally enforceable debt or liability - hence, his conviction by High Court, held, proper. In another decision of Hon'ble Apex Court of India, reported in CRIMINAL APPEAL NO. 508 OF 2018 DT 15032018 between ROHITBHAI JIVANLAL PATEL Vs. STATE OF GUJARAT AND ANR held that "Negotiable Instruments Act facts like source of funds are not relevant if the Accused has not been able to rebut the presumption. It is further held that " When such a presumption is 33 C.C.No.976/2019 drawn, the facts 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". In another decision of Hon'ble Apex court of India decided in Crl.Appeal No.1545 of 2019 dt.17/10/2019 by the Hon'ble Apex Court of India in the case of Uttam Ram Vs. Devinder Singh Hudan and Anr. Wherein the Hon'ble Apex Court held that, " Dishonor of cheque - Statutory presumption under - burden to prove - the burden is on the accused to rebut the presumption that the cheque was issued not for any debt or other liability - it is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer - even a blank cheque leaf, voluntarily signed and handed over by the accused which is towards some payment, would 34 C.C.No.976/2019 attract presumption U/s. 139 of NI Act - the accused is held guilty of dishonour of cheque for an offence U/s.s.138 of NI Act. It is also held that, " the accused has failed to lead any evidence to rebut the statutory presumption, a finding returned by both the Trial Court and High Court. Both courts not only erred in law but also committed perversity when the due amount is said to be disputed only on the account of discrepancy in the cartons, packing materials or the rate to determine the total liability as if the appellant was proving his debt before the civil court. Therefore it is presumed that, the cheque in question were drawn for consideration and the holder of the cheques received the same in existing debt". It is also held that, " the Trial court and the High Court proceeded as if, the appellant is to prove a debt before civil Court wherein, the plaintiff is required to prove his claim on the basis of evidence to be laid in 35 C.C.No.976/2019 support of his claim for the recovery of the amount due. A dishonour of cheque carries statutory presumption of consideration. The holder of cheque in due course is required to prove that, the cheque was issued by the Accused and that when the same presented , it was not honoured Since there is a statutory presumption of consideration, the burden is on the Accused to rebut the presumption that, the cheque was issued not for any debt or other liability ". It is also relevant here to refer the decision of Hon'ble High Court of Karnataka reported in ILR 2019 KAR 493 in the case of Sri.Yogesh Poojary Vs. Sri.K.Shankara Bhat, wherein the Hon'ble High Court held that, the presumption mandated by Sec.139 of N.I Act includes the presumption that, there existed a legally enforceable debt or liability, however such presumption is rebuttable in nature". In another decision of Hon'ble High Court of Karnataka in the 36 C.C.No.976/2019 case of Shri.V.R.Shresti Vs. Shri. Bhaskara.P. in Crl. Appeal No. 2109/2017 dated: 15.10.2019 wherein the Hon'ble High Court of Karnataka held that "the Accused has not given any reply to the notice and also in the crossexamination, he categorically admits that, the cheque has bounced on account of no sufficient fund in the bank account of the Accused. Mere non producing of the document before the court with regard to the source of income to advance a loan is not a ground to dismiss the complaint. The Accused ought to have rebutted the contention of the complainant by producing cogent evidence before the court and mere denial is not enough".
22. Therefore in view of the above principles of law laid down by the Hon'ble Apex Court of India and High Court of Karnataka in the above referred decisions makes it very clear that, once the holder in due course i.e. the complainant proved that, the cheque in question belongs to the drawer and 37 C.C.No.976/2019 signature appearing on the cheque is that of the drawer i.e., Accused and complied the mandatory requirements as required U/s.138 of N.I.Act, a presumptions U/s.118a and 139 of N.I.Act indeed does extend to the existence of legally recoverable debt. In the present case also the complainant has complied the mandatory requirements and has proved that, the Accused has issued the cheque in question in his favour and the Accused has admitted the cheque belongs to him and accused has failed to prove that, signature found on the cheque is not of his signature and legal notice issued by complainant was served on the Accused, in such circumstances, presumptions have to be drawn towards existence of legally enforceable debt as per Sec.139 of N.I.Act.
23. Therefore, for the above said reasons the defence taken by the Accused that, the complainant has not produced the documents to show that, the cheque in question was issued towards discharge of the arrears of interest amount and the signature found on the cheque in question i.e Ex.P.1(a) is not of 38 C.C.No.976/2019 his signature cannot be acceptable one and the arguments canvassed by the learned cousnel for the defence in the written arguments are also not accepted.
24. The Accused in order to rebut the presumptions available to the complainant U/s.118(a) and 139 of N.I. Act and to substantiate his defence himself examined as DW.1. The Accused /DW.1 in his evidence deposed that, he has not borrowed any amount from the complainant but the complainant collected his blank cheques without his signatures and has presented his cheque to the bank by committing forgery of his signature for that, the concerned banker has also issued endorsement stating that, signature found on the cheque is not of his signature and he has given reply to the legal notice issued by the complainant.
25. In support of oral evidence of the accused has not produced any documentary evidence i.e. to show that, complainant has collected his blank 39 C.C.No.976/2019 cheque and thereafter has committed forgery of his signature and presented the cheque in question to the bank. As it is already held in the above that, the accused in his reply i.e Ex.P.8 has contended that, the cheque in question was in the possession of his wife and the complainant has forcibly taken the cheque from his wife which was unfilled, unsigned and undated and the complainant has forged his signature and presented the said cheque to the bank for realization. If such being the fact, the accused would have been stated the same defence in his evidence before the court but in contrary to the defence set up by him in the reply notice has stated that, the complainant has collected his cheques from him, therefore the defence of the accused appears to be a contrary to each other ie., the defence set up by the accused at the earlier stage i.e in reply notice in Ex.P.8 has falsyfied by him only by taking contrary defence before the court, in such circumstances the defence set up by the accused appears to be general denial and in order to avoid liability from paying the cheque amount the accused has set up a story 40 C.C.No.976/2019 which is untenable and not acceptable one.
26. The accused If really the cheque in question was forcibly taken by the complainant from his wife when it was in the possession of his wife and thereafter the complainant has forged his signature and presented to the bank for its encashment, immediate after coming to know about the alleged act of the complainant, definitely the Accused would have taken or initiated action against the complainant either by lodging the complaint before the police or court of law or at least by issuing notice to the complainant for return of his alleged blank cheque collected by her as stated by him or by issuing stop payment instructions to his banker, but no such efforts have been made by the Accused even after notice of the alleged misuse of the cheque by the complainant, therefore bare denial of the Accused is not sufficient to hold that, he has rebutted the presumptions available to the complainant U/s.118 and 139 of the N.I. Act. It is also relevant here to mention that, the conduct of the Accused in not 41 C.C.No.976/2019 taking the action against the complainant for alleged misuse of the cheque in question by the complainant may leads to draw an adverse inference against him that, the Accused has not initiated any action against the complainant since the cheque in question has been issued by the Accused to the complainant towards discharge of the liability in question but not for any other purpose. In this regard it is relevant here to refer the decision of Hon'ble Apex Court of India reported in AIR 2018 SC 3601 in a case of T.P.Murugan(dead) Thr. Lrs.V. Bhojan Vs. Posa Nandi, rep. Thr. Lrs. PA holder, T.P. Murugan V. Bhojan, wherein the Hon'ble apex Court 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 10 blank cheques back in 1995 and never asking their return for 7 42 C.C.No.976/2019 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". Hence in view of the principles of law laid down by the Hon'ble Apex Court are aptly applicable to the case on hand since in the present case also the accused has not made any efforts to get return of cheque alleged to have been forcibly taken by the complainant from the possession of his wife, under such circumstances, the said unnatural conduct of the accused in non taking of action, an adverse inference can be drawn against the accused that, the cheque in question issued by the accused towards discharge of the liability and presumption U/s.139 of N.I.Act would operate against him, as he has admitted cheque in question is belongs to Accused.
27. It is also important to note here that, the 43 C.C.No.976/2019 Accused has not denied or disputed that the cheque in question do belong to him and though he has taken the specific defence that, the cheque in question has not been given to the complainant towards discharge of interst amount with regard to loan borrowed by his wife and it has been misused by the complainant and has filed this false case against him, but the Accused has not proved the said defence by producing cogent and convincible evidence , in such circumstances it can be held that, the Accused has failed to explain and prove how the cheque in question has come to the possession of the complainant, this would also give rise to an adverse inference against her, as it is already cited the decisions in this proposition of law finds support from the decisions of Hon'ble High Court of Karnataka reported in 2010(1) KCCR 176 in the case of "Siddappa Vs. Manjappa" and in the decision of Hon'ble Apex court of India decided in Crl.A.No.664 of 2012 dated: 19.9.2019 in the case of "M.Abbas Haji Vs. T.M.Chennakeshava"
44C.C.No.976/2019 held that, " the Accused has to explain how the cheque entered into the hands of complainant".
Therefore for the above said reasons the defense taken by the accused cannot be acceptable one and accused has miserably failed to rebut the presumption available in favour of the complainant by producing cogent and convincible evidence.
28. Therefore considering all these aspects of the case and totality of the circumstances and on careful and meticulous appreciation of evidence adduced on behalf of the complainant and accused the complainant has successfully established beyond all reasonable doubt that, she has lent loan amount of Rs.4,00,000/ to the wife of the Accused for construction of house in the first week of March 2017 and in turn the wife of the accused agreed to repay the said loan amount along with the interest at the rate of 2% p.m. within 21 months and also proved that, the accused; wife has paid part of interest amount of Rs.30,000/ out of the total interest amount of Rs.1,68,000/ for a period of 21 months 45 C.C.No.976/2019 and the accused has agreed to pay the balance interest amount of Rs.1,38,000/ to the complainant and has issued Ex.P.1 cheque in question for sum of Rs. 1,38,000/ in favour of the complainant and thereafter the complainant has presented the said cheque through her banker and same was returned dishonoured with an endorsement of "Drawer's Signature Differs" and thereafter she got issued legal notice to the accused and the said notice was served on him, inspite of it, the Accused did not paid the cheque amount, hence the complainant filed the present complaint against the accused. On the other hand, the accused has failed to rebut the presumption available infavour of the complainant with regard to the existence of legally recoverable debt under Ex.P.1 Cheque. Therefore accused has committed an offence punishable U/s.138 of N.I. Act, accordingly for the above said reasons this point is answered in the Affirmative.
29. Point No.2: Negotiable Instrument Act was enacted to bring credibility to the cheque and the 46 C.C.No.976/2019 very purpose of enactment is to promote the use of negotiable instrument, while to discourage the issuance of cheque without having sufficient funds in their accounts. Such being the case the intention of the legislature is that, complainant be suitable compensated while accused be punished for his act. Hence while awarding the compensation the said fact is to be kept in mind and suitable compensation is awarded to the complainant certainly it will not cause injustice to the accused, accordingly the complainant is entitled for the compensation as ordered by the court and for the said reasons, it is just and proper to pass the following : ORDER Acting U/sec.255(2) of Cr.P.C. the accused is convicted for the offence punishable U/sec.138 of N.I.Act.
The accused is sentenced to pay a fine of Rs. 1,45,000/= (Rupees One Lakh Forty Five Thousand only) within one month from the date of order, in default he shall under go simple imprisonment for a period of (3) 47 C.C.No.976/2019 three months for the offence punishable U/sec.138 of N.I.Act.
Further acting U/sec.357(1) of Cr.P.C. out of the fine amount on recovery, a sum of Rs. 1,40,000/= (Rupees One Lakh Forty Thousand Thousand only) shall be paid as compensation to the complainant.
Further acting U/sec.357(1)(a) of Cr.P.C. out of fine amount on recovery a sum of Rs.5,000/= (Rupees Five Thousand only) shall be defrayed as prosecution expenses to the state.
His Bail bond and surety bond stands cancelled after appeal period is over.
. Office is directed to furnish free certified copy of this judgment to the Accused incompliance of Sec.363(1) of Cr.P.C.
(Directly dictated to the stenographer online, printout taken by her, verified, corrected and then pronounced by me in the open Court on this the 26h day of November 2020).
(SRI.S.B. HANDRAL), XVI ACMM, Bengaluru City.
48C.C.No.976/2019 ANNEXURE
1. List of witness/s examined on behalf of the Complainant: P.W.1 : Smt. Shivarathna
2. List of documents exhibited on behalf of the Complainant: Ex.P1 : Original Cheque;
Ex.P1(a) : Signature of the Accused;
Ex.P2 : Bank Memo Ex.P3 : Office copy of the Legal Notice; Ex.P4 & 5 : postal receipts; Ex.P6 & 7 : Postal acknowledgements; Ex.P.8 : Reply Notice; Ex.P 9 : Complaint; Ex.P 9 (a) : Signature of the Complaint; Ex.P 10 : Reply Notice (Marked through DW.1)
3. List of witness/s examined on behalf of the Accused: DW.1 : Sri.Ramesh
4. List of documents exhibited on behalf of the Accused: Nil (SRI.S.B.HANDRAL), XVI ACMM, Bengaluru City.
49C.C.No.976/2019 26.11.2020 case called, Both complainant and accused are absent, counsel for the Complainant absent, counsel for the Accused present.
Judgment pronounced in the open court vide separate order.
ORDER Acting U/sec.255(2) of Cr.P.C. the accused is convicted for the offence punishable U/sec.138 of N.I.Act.
The accused is sentenced to pay a fine of Rs. 1,45,000/= (Rupees One Lakh Forty Five Thousand only) within one month from the date of order, in default he shall under go simple imprisonment for a period of (3) three months for the offence punishable U/sec.138 of N.I.Act.
Further acting U/sec.357(1) of Cr.P.C. out of the fine amount on recovery, a sum of Rs. 1,40,000/= (Rupees One Lakh Forty Thousand Thousand only) shall be paid as compensation to the complainant.
Further acting U/sec.357(1)(a) of Cr.P.C. out of fine amount on recovery a sum of Rs.5,000/= (Rupees Five Thousand only) shall 50 C.C.No.976/2019 be defrayed as prosecution expenses to the state.
His Bail bond and surety bond stands cancelled after appeal period is over.
. Office is directed to furnish free certified copy of this judgment to the Accused incompliance of Sec.363(1) of Cr.P.C..
XVI ACMM, B'luru.