Bangalore District Court
Sri.Mallikarjunaiah H.M vs Sri.T.G.Ranganath on 15 September, 2018
1 C.C.No.16375/2016 J
IN THE COURT OF THE XVI ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE, BENGALURU CITY
Dated: This the 15th day of September, 2018
Present: Smt. Saraswathi.K.N, B.A.L., LL.M.,
XVI Addl.C.M.M. Bengaluru City.
JUDGMENT U/S 355 OF Cr.P.C.,
Case No. : C.C.No.16375/2016
Complainant : Sri.Mallikarjunaiah H.M,
S/o.Sri.Somashekaraiah H.M,
Aged about 54 years,
R/at No.13, KHB Quarters,
Lalbagh, Siddapura,
1st Block, Jayanagar,
Bengaluru - 560 011.
(Rep. by Sri.M.S.Vishwanath and
Shankar, Advs.,)
- Vs -
Accused : Sri.T.G.Ranganath,
S/o. Late Sri.T. Govindaraj @
Govindaiah,
Aged about 59 Years,
Residing at No.523, 'Sumuka',
BSK 3rd Stage, 3rd Main,
2nd Phase, Girinagar,
Bengaluru - 560 085.
(Rep. by Sri.A.Madhusudhana Rao and
others, Advs.,)
Case instituted : 14.6.2016
Offence complained : U/s 138 of N.I. Act
of
2 C.C.No.16375/2016 J
Plea of Accused : Pleaded not guilty
Final Order : Accused is acquitted
Date of order : 15.9.2018
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 that, he along with one H.D.Ramesh and Mrs.Prafullamukhi were running a company by name "Logipro Software Pvt., Ltd.," engaging in staffing solutions for IT companies and it was running in profit condition. This being the case, he and the above said Ramesh thinking to provide virtual education to students studying distant learning education has formed another company in the name and style of "Futureware Technologies Pvt., Ltd., The Accused, being known to him since 2007 and having friendship with him and also knowing his entrepreneurship had contacted him and requested to induct him as on the of the board of Directors to the above said "Futureware Technologies Pvt., Ltd., Company and the Accused also assured him that he would invest in the venture for the development of the company. Believing the version of the Accused, he and his co-director have inducted the Accused as one of the board of directors to the company "Futureware in the year 2010.
3 C.C.No.16375/2016 JAfter becoming one of the board of directors to the company started investing and finally he held 99 % of the shares in the said company and he continued to run the said company.
3. The Complainant has submitted that, in the month of March 2011, the Accused approached him and represented to him that due to income tax problem, he was in temporary financial crisis and hence, he requested him to give him an amount of Rs.81 Lakhs to solve his urgent financial problems. Having good friendship with the Accused and also knowing his financial capacity gave him an amount of Rs.81 Lakhs by way of cash as a hand loan.
4. It is submitted by the Complainant that, at that time, since the Accused was also one of the board of directors in the company Futureware and he having good faith on the Accused never insisted the Accused for any documents towards the security of the above said amount paid to the Accused. However after having received the said amount, the Accused assured him that he would repay the same to him within six months from the said date.
5. The Complainant has submitted that, after the expiry of six months, he requested the Accused to repay the above said loan amount, but the Accused went on 4 C.C.No.16375/2016 J postponing the same and in view of the same, the former suffered from mental shock and agony and hence he also suffered from ill health and heart attack in the month of July 2012. By that time, the Accused assured him that he would arrange the money payable to him but again postponed the same on one or the other reason.
6. The Complainant has submitted that, in the meanwhile, by convincing him and his co-directors of the company "Logipro Software Pvt., Ltd.,", the Accused inducted himself as one of the board of directors to the earlier company "Logipro". Thereafter the Accused started unnecessary interference in the management of the company. Hence due to the interference and the mismanagement of the Accused, the company which was under profit condition started to suffer loss. However the Accused did not repay the loan amount and at the same time, he also destroyed the business of the company "Logipro".
7. The Complainant has submitted that, after his several requests and demands, during the second week of January 2016, the Accused has issued cheque for Rs.81 Lakhs dated 17.1.2016 bearing No.775680 drawn on the IOB, Jayanagar VII Block, Bengaluru towards the repayment of the loan amount, with an assurance that the 5 C.C.No.16375/2016 J same would be duly honored on its presentation on the due date.
8. The Complainant has submitted that, as per the instructions of the Accused, when he presented the said cheque for encashment, the same came to be returned dishonored as "Required Information Not Legible or Correct". Though he informed this fact to the Accused, he did not respond to the same.
9. The Complainant has further submitted that, he got issued a legal notice to the Accused on 2.5.2016 through RPAD calling upon him to pay the cheque amount to him within 15 days from the date of the receipt of the said legal notice. Though the said legal notice has been duly served upon the Accused, he has neither replied nor has he paid the cheque amount to him.
10. The Complainant submits that, the dishonour of the cheque by the Accused has been malafide, intentional and deliberate. Feeling aggrieved by the conduct of the Accused, he has filed the present complaint praying that the Accused be summoned, tried and punished in accordance with Sec.138 of the Negotiable Instruments Act.
6 C.C.No.16375/2016 J11. The Complainant has led the pre-summoning evidence. He has filed his affidavit-in-lieu of his sworn statement in which he has reiterated the complaint averments.
12. In support of his case, the Complainant has relied upon the following documentary evidence as per Ex.C1 to C8, which is as follows:-
Ex.C1 is the cheque dated 17.1.2016, Ex.C1 (a) is the signature identified by C.W.1 as that of the Accused, the Cheque Return Memo as per Ex.C2, the office copy of the Legal Notice as per Ex.C3, the Postal Receipt as per Ex.C4, the Un-served Legal Notice as per Ex.C5, the Postal Envelope as per Ex.C6, the Postal Receipt as per Ex.C7 and the Postal Acknowledgment as per Ex.C8.
13. Prima-facie case has been made out against the Accused and he has been summoned vide the order of the same date.
14. The Accused has appeared before the Court and he has been enlarged on bail and the substance of the accusation has been read over to him, to which, he has pleaded not guilty and has claimed the trial.
7 C.C.No.16375/2016 J15. In his post-summoning evidence, the Complainant has examined himself as PW1 and has filed his affidavit, wherein he has reiterated the averments made in the complaint.
16. In support of his oral evidence, P.W.1 has produced and relied upon the following additional documentary evidence:-
Ex.P.9 and P.10 are the certified copies of the judgment and complaint of C.C.No.21060/2016 respectively, Ex.P.11 and P.12 are the certified copies of the complaints of C.C.No.13805/2015 and 13806/2015 respectively, Ex.P.13 to P.16 are the certified copies of the complaints of C.C.No.5756/2015, C.C.No.3153/2015, C.C.No.4774/2015 and C.C.No.9753/2015 respectively, Ex.P.17 and P.18 are the IT Returns of 2011-12 and 2012- 13 respectively and Ex.P.19 to P.23 are the IT Returns of 2008-09 to 2012-13.
17. The statement of the Accused under Sec.313 of Cr.P.C., has been recorded. He has denied the incriminating evidence found against him and has chosen to rebuttal evidence.
8 C.C.No.16375/2016 J18. The Accused has led his rebuttal evidence by examining himself as DW1 and the gist of his defence is as follows:-
i) That he knows the Complainant since 2007;
ii) That the Complainant along with one H D Ramesh had started a Private Limited company in the name of Futureware Technologies Pvt., Ltd., in the year 2007 or 2008;
iii) That the said company was established for the purpose of imparting virtual education and that they had no money;
iv) That the Complainant and H D Ramesh had invested Rs.50,000/= each at the time of establishing the said company;
v) That both of them had come to know that he had money by having sold his coffee estate for Rs.18 Crores in Chikkamagaluru;
vi) That the Complainant and H D Ramesh wanted him to invest Rs.1 Crore in the said company;9 C.C.No.16375/2016 J
vii) That they promised him of great returns from the said company;
viii) That later on he came to know that they had planned to utilize his money for their personal purposes;
ix) That they had floated another company by name Logipro Software Pvt., Ltd., much earlier;
x) that there also they had received one Veeresh and others for investment purpose in the said company and the said Veeresh has also filed one or two cases against the said company i.e. Logipro;
xi) That later he realized that the Complainant himself was in great debts and he owed money to a bank, which he has admitted in this case;
xii) That he has invested nearly 1 Crore 35 Lakhs through cheques in Futureware and he has the documentary proof signed by the Complainant to prove that he has received the amounts form him for the sake of the company;10 C.C.No.16375/2016 J
xiii) That he has his bank statements to show that not only as on the date of his alleged borrowing of loan from the Complainant, but also on subsequent dates, he had sufficient funds with him;
xiv) That he has not issued any of his cheques to the Complainant as claimed by the latter;
xv) That he had lost of few of his cheques, including the subject cheque;
xvi) That he had lodged a complaint in this regard before the Shankarapuram Police on 9.11.2009;
xvii) That he now suspects that the Complainant might have stolen his cheques while they were in the same office;
xviii) That when he was in Hyderabad, he got issued a notice to the Complainant, since he got filed number of cases against him through one Mr.Harikrishna, who has field cases against him both in Bengaluru and in Hyderabad, through one Hema Akalawadi and others;11 C.C.No.16375/2016 J
xix) That he has not borrowed any loan from the Complainant and that the latter has no capacity to lend any such loan to him that too by way of cash;
xx) That there was no necessity for him to avail any such loan from him;
xxi) That there is no service of the legal notice on him;
19. In support of his defence version, D.W.1 has relied upon the following documentary evidence:
i) His Bank Passbook of Karur Vysya Bank as per Ex.D2;
ii) The statement of accounts of Canara Bank, Mysore as per Ex.D3;
iii) 9 payment vouchers as per Ex.D4 to D12;
iv) The signatures of the Complainant as per Ex.D4(a), D6(a) to 8(a) and D11(a) and the signature of Mr.H D Ramesh as per Ex.D9(a);
v) 2 RTGS vouchers as per Ex.D13 and D14;12 C.C.No.16375/2016 J
vi) The copy of the complaint dated 24.2.2017 as per Ex.D15;
vii) The copy of the statement dated 12.5.2017 as per Ex.D16;
viii) The copy of the complaint dated 9.11.2009 as per Ex.D17 and his Vijaya Bank Passbook as per Ex.D18.
20. D.W.1 has been cross-examined by the counsel for the Complainant.
21. The learned counsel for the Complainant has addressed his arguments, during which, he has prayed for the conviction of the Accused on the following grounds:-
i) That the Complainant has fulfilled the ingredients of Sec.138 of the N.I.Act. The Accused has admitted that the cheque in dispute belongs to him with his signature on it;
ii) That the Accused is a habitual offender;
iii) That the amount of Rs.81 Lakhs was lent by the Complainant to the Accused in the year 2011 by way of cash as Accused represented to him to be a big shot;13 C.C.No.16375/2016 J
iv) That the Accused and the Complainant were the partners of the same company;
v) That the Accused was facing the situation of IT raids and therefore his bank accounts were frozen;
vi) That the friendship between them was so cordial that the Complainant did not doubt the Accused;
vii) That the Complainant has produced the IT returns of him and his wife to show that they had the source of funds;
ix) That the Complainant has not declared about his funds in his IT returns;
x) That the Complainant had the source to lend Rs.81 Lakhs to the Accused;
xi) That there is no rebuttal evidence led by the Accused;
xii) That the cheque lost theory of the Accused is not a probable one;
xiii) That there is no defence of the Accused suggested to the Complainant in his cross-
examination;
14 C.C.No.16375/2016 Jxiv) That the Accused admits the correctness of his address in his legal notice;
xv) That the Accused has not issued the cheqeu while receiving the loan amount from the Complainant;
xvi) That the cheque was not issued by the Accused to the Complainant for security purpose;
xvii) That as all the accounts of the Accused were frozen, he opened his account in Mysore;
xviii) That as per Ex.D2, the Accused started depositing the said amount part wise in his Mysore accounts and started withdrawing the same and investing in the Futureware company;
xix) That the Accused has issued the subject cheque to the Complainant in the year 2016, when the Complainant suffered a heart attack xx) That there is contradiction in the defence of the Accused about the place where the Accused allegedly lost his cheques;
15 C.C.No.16375/2016 Jxxi) That the complaint lodged by the Accused is a false one;
xxii) That if the Accused joined Futureware in the year 2010, then his claim that the Complainant has stolen his cheqeu in the year 2009 cannot be probable;
xxiii) That the Accused ash not taken any legal action against the Complainant till date;
xxiv) That no steps have been taken by the Accused to see that there was serious investigation into the complaint against the Complainant by him.
Accordingly, he has prayed for the conviction of the Accused.
22. Per contra, the learned Defence Counsel has also addressed his arguments, during which, he has prayed for the acquittal of the Accused on the following grounds:-
i) That there is no pleading with regard to the date of approach;
ii) That according to the Complainant, the date of the issuance of the cheque is in 16 C.C.No.16375/2016 J January 2016, while the presentation of the cheque is in April 2016;
iii) That there is no explanation by the Complainant as to why he has not taken any action against the Accused from 2011 to 2016;
iv) That the cheqeu return memo at Ex.C2 as "Required Information not legible/correct"
and as such the provision of Sec.138 is not attracted;
v) That the natural conduct of the Complainant would have been to go to the bank and enquire about the cheqeu return memo;
vi) That there are material contradictions about the date of the issuance of the cheque in the cross-examination of the Complainant;
vii) That the Complainant has failed to prove his source of funds;
viii) That the Complainant admits that he was a defaulter of loan in a bank in the year 2012;17 C.C.No.16375/2016 J
ix) That the claim of the Complainant that he lent Rs.81 Lakhs to the Accused is highly doubtful;
x) That the Complainant had no money in the year 2011;
xi) That the IT Returns of 2010-11 of the Complainant at Ex.P17 shows his financial status at the relevant point of time;
xii) That the Complainant admits that his IT documents produced by him are incomplete documents;
xiii) That non-declaration of the alleged lending of Rs.81 Lakhs to the Accused by the Complainant is a serious doubtful circumstance in the case of the latter;
xiv) That the Accused has produced his bank documents to prove his financial soundness at the relevant point of time;
xv) That the bank statement at Ex.D2 shows the constant rise in the balance in the account of the Accused;
xvi) That as on 9.4.2011, the Accused had more than a Crore rupee in his bank account;18 C.C.No.16375/2016 J
xvii) That the account in respect of Ex.D2 was not frozen;
xviii) That Ex.D3 shows the balance of Rs.25 Lakhs in his Canara Bank account;
xix) That Ex.D9 to D12 prove the receipt of the amounts by the Complainant from the Accused;
xx) That the Complainant lodged a complaint against the Accused in the police station as per Ex.D15, by suppressing about the filing of the present case;
xxi) That there is suppression of facts by the Complainant, which goes to prove his malafides;
xxii) That each case has to be decided on the basis of its own facts and judgments of other cases should not be relied upon in this case;
xxiii) That the complaint itself is not maintainable since the debt in question, even if existed, had become time barred as on the date of the issuance of the subject cheque;19 C.C.No.16375/2016 J
xxiv) That the Complainant has admitted that he has received the payments from the Accused to Logipro till November 2011;
xxv) That non-obtaining of the security documents by the Complainant from the Accused for the security of loan;
xxvi) That there is no service of the legal notice on the Accused;
xxvii)That there are two contrary postal sharas and as such the Accused cannot be attributed with the knowledge of the legal notice;
xxviii) That the Accused has lodged the complaint about the loss of cheques in the year 2009 i.e., on 9.11.2009;
xxix) That the Accused and the Complainant are known to each other since 2007;
xxx) That the Accused has probablised his defence.
Accordingly, he has prayed for the acquittal of the Accused.
20 C.C.No.16375/2016 J23. I have considered the submissions and perused the record carefully.
24. Sec.138 of the Negotiable Instruments Act has been enacted to lend credibility to the financial transactions.
The main ingredients of the offence under Section 138 Negotiable Instruments Act are:-
(i) Drawing up of a cheque by the Accused towards the payment of the amount of money, for the discharge, in whole or in part, of any debt or any other liability;
(ii) Return of the cheque by the bank as unpaid;
(iii) The drawer of the cheque fails to make the payment of the said amount of money within 15 days of the receipt of the notice under the proviso (b) to Section 138.
The Explanation appended to the Section provides that, the "debt or other liability" for the purpose of this Section means a legally enforceable debt or other liability.
25. Apart from this, Sec. 139 of the Negotiable Instruments Act lays down a presumption in favour of the holder of cheque in the following terms:-
"It shall be presumed, unless the contrary is proved, that:-21 C.C.No.16375/2016 J
The holder of a cheque received the cheque, of the nature referred to in Sec. 138, for the discharge, in whole or in part, of any debt or other liability".
26. Also, Sec. 118 of the Negotiable Instruments Act states, "Until the contrary is proved, the following presumptions shall be made:-
(a) That every Negotiable Instrument was made or drawn for consideration and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration;"
27. Thus, the Act clearly lays down the presumptions in favour of the Complainant with regard to the issuance of the cheque by the Accused, towards the discharge of his liability in favour of the Complainant.
28. Under the scheme of the Act, the onus is upon the Accused to rebut the presumptions in favour of the Complainant by raising a probable defence.
29. It is a well settled position of law that the defence of the Accused, if in the nature of a mere denial of the case of the Complainant will not be sufficient to hold it as a probable defence. The bare denial of the passing of consideration apparently does not appear to be any 22 C.C.No.16375/2016 J defence. Something which is probable must be brought on record for getting the benefit of shifting the onus of proof to the Complainant.
30. It is also a well settled position of law that, once the cheque is proved to be relating to the Account of the Accused and he accepts and admits the signature on the said cheque, then the initial presumption as contemplated under Sec.139 of the N.I.Act has to be raised by the courts in favour of the Complainant. The presumption referred to in Sec.139 of the N.I.Act is a mandatory presumption and not a general presumption, but the Accused is entitled to rebut the said presumption. What is required to be established by the Accused in order to rebut the presumption is different from each case under given circumstance. But the fact remains that a mere plausible explanation is not expected from the Accused and it must be more than a plausible explanation by way of rebuttal evidence. The defence raised by the Accused by way of rebuttal evidence must be probable and capable of being accepted by the court.
31. No doubt the initial mandatory statutory presumptions under Sec.118 and 139 of the N.I.Act are in favour of the Complainant. However they are rebuttable presumptions and the Accused is expected to rebut the presumptions by raising a probable defence.
23 C.C.No.16375/2016 J32. Such being the legal position, it would be pertinent to refer to the defences raised by the Accused to rebut the presumptions in favour of the Complainant in this case.
33. In the present case, there is no dispute with regard to the fact that the subject cheque belongs to the Accused and that it bears his signature. Likewise there is no dispute with regard to the acquaintance between the parties as well as the existence of the business transaction between them. However there is a serious dispute on the part of the Accused with regard to the existence of his alleged loan transaction to the tune of Rs.81,00,000/= as claimed by the Complainant in the present case. In such circumstance, the onus of proving the existence of the alleged loan transaction is no doubt upon the Complainant.
34. However it is a well settled principle of law that, the defence raised by the Accused cannot be the only basis to come to the conclusion that, the case of the Complainant is beyond reasonable doubt and it is a well settled principle of law that, one of the essential ingredients of an offence punishable under Sec.138 of the N.I Act is the existence of the legally enforceable debt.
24 C.C.No.16375/2016 J35. In this regard even the explanation to Sec.138 of the N.I.Act is clear, wherein it has been held that, the phrase "debt or other liability" means a legally enforceable debt or liability.
36. In the present case, it is necessary to consider the question, as to, if there is a legally enforceable debt as provided under Sec.138 of the N.I. Act in this case?
37. In this regard, it is pertinent to note that the liability of the Accused under the cheque in dispute is concerned, as per the case of the Complainant, the transaction between the parties is said have taken place in the year 2011 and the cheque in dispute is admittedly claimed to have come to his possession only in the year 2016. Therefore it is necessary to consider the case of the Complainant with regard to the question of the maintainability of the complaint in view of the bar of limitation.
38. In such circumstance, even when the question of maintainability of the Complaint in the light of the debt, even if any existed is not raised by the Accused, before considering the other aspects involved in the matter, it is incumbent on the part of the court consider the said question, since the answer to the same touches the very maintainability of the complaint. It is only after that the 25 C.C.No.16375/2016 J said question is answered by the court that, the question of considering the other aspects of the matter would arise.
39. In this regard, it is pertinent to note that, as per the complaint averments, the Accused is said to have approached the Complainant seeking for a temporary financial assistance of Rs.81 Lakhs in the month of March 2011 and by considering his request, the Complainant claims to have advanced the loan amount of Rs.81 Lakhs to the Accused by way of cash. Admittedly there is no pleading with regard to the specific date of the alleged lending. In such circumstance, it should be construed as March 2011 as the month of the alleged lending of the loan by the Complainant to the Accused.
40. Thereafter as the complaint averments, the Complainant claims to have persistently demanded the Accused after six months from his alleged lending to 2nd week of January 2016 i.e., till the Accused is said to have issued the subject cheqeu to him towards his alleged repayment of the loan to him.
41. That means as per the own pleading of the Complainant, the Accused is said to have issued the subject cheqeu dated 17.1.2016 in his favor during second week of January 2016 towards his alleged repayment of the 26 C.C.No.16375/2016 J loan of Rs.81 Lakhs which was borrowed by him from the former during the month of March 2011. This clearly goes to show that it is after nearly 4 years and 9 months that the Accused is said to have issued the subject cheque to him towards the discharge of his liability. In such circumstance, from the plain reading of the complaint averments it is clear that, even if there existed any debt on the part of the Accused towards the Complainant, then as on the date of the issuance of the subject cheque by him to the Complainant, the said debt had already become time barred debt and the same cannot be termed to be a legally recoverable debt.
42. In this regard it is pertinent to note that, it is not the case of the Complainant that the loan that was advanced by him to the Accused carried any interest and that the Accused was paying some interest to him towards the said loan during the period from 2011 to 2016 i.e., from the date of borrowing of the loan till the date of the issuance of the subject cheque, in which circumstance, the debt could have been saved for the purpose of limitation.
43. Likewise it is not the case of the Complainant that in between the period of 2011 and 2016, the Accused has executed any document in the nature of an acknowledgment of debt or agreement in writing promising 27 C.C.No.16375/2016 J to repay the loan to him, in which circumstance, there could have been a fresh period of limitation of three years from the date of such agreement or promise in writing. There is absolutely no pleading and proof on the part of the Complainant in this regard.
44. Therefore, it is pertinent to note that, except the cheque, there is no other contemporary document/s, said to have been collected by the Complainant from the Accused, thereby acknowledging his liability, in writing, within a period of three years from the date of the alleged loan transaction of the year 2011. Therefore even if the cheque at Ex.C1 is considered by this court, even then, there can be no legally enforceable liability that could be imputed against the Accused on the basis of the said cheque.
45. In such circumstance, when there is clear pleading and proof with regard to the date on which the aforesaid cheque was issued by the Accused to the Complainant, then prima-facie the complaint becomes barred by time, since it amounts to the issuance of the cheque towards a time barred debt and liability, which is admittedly not a legally enforceable debt and liability.
46. Now coming to the oral evidence of the parties in this regard, even in his cross-examination the Complainant 28 C.C.No.16375/2016 J has deposed that, the Accused had sought for the loan from him in the month of January 2011 and that he has lent the loan to him in the month of March 2011 and that the Accused has issued the subject cheque to him during the second week of January 2016. He has also deposed that, he has presented the subject cheque for encashment on 17.1.2016.
47. No doubt there is absolutely no defence raised on behalf of the Accused either while cross-examining the Complainant or in his rebuttal evidence with regard to the debt in question having become a time barred one. However it is a settled position of law that even if the said question is not agitated before the court by either of the parties to the proceeding, it is the duty cast upon the court to consider the question of the legally enforceable debt by taking into consideration the pleading and the proof available on record.
48. Therefore even if it is assumed for a moment that the alleged loan transaction in fact existed, even then the same had become a legally unenforceable debt, being a time barred debt, as on the date of the issuance of the cheqeu in question by the Accused to the Complainant. As such, even if the case of the Complainant that he has advanced a huge loan of Rs.81 Lakhs to the Accused in 29 C.C.No.16375/2016 J cash as claimed by him is believed to be true, then also, he is not entitled to recover the said amount from the Accused, since the debt had already become time barred and that there cannot be any liability imputed against the Accused on the basis of such barred debt and liability.
49. Therefore the evidence on record clearly reveals that except the cheque at Ex.C1, there is no acknowledgement in writing by the Accused by admitting his liability, which would have saved the limitation and made the alleged liability of the Accused a legally enforceable one. This clearly leads to an inference that, even if there existed any debt and liability on the part of the Accused towards the Complainant, in respect of the works loan that the former had borrowed from the latter, the said debt and liability cannot be a legally enforceable one in view of the bar contained under Sec. 25(3) of the Indian Contract Act as well as Sec.18 of the Limitation Act. Therefore this clearly goes to show that, as per the own pleading and proof of the Complainant, the Accused has been able to clearly establish before this court that, the cheque in question is not towards the debt and liability, which could be legally enforced and as such, the complaint itself is not maintainable in view of the bar contained under Sec.18 of the Limitation Act. Therefore, on this 30 C.C.No.16375/2016 J technical ground itself, the complaint is liable to be dismissed.
50. In this regard, I place reliance upon the following decision of the Hon'ble Apex Court in A.V.Murthy Vs., Nagabasavanna, reported in AIR 2002 SC 985, wherein, the Hon'ble Apex Court has held that:-
"The question of an acknowledgment reviving the period of limitation could be agitated before the Magistrate in a case where there was documentary evidence.
51. In the said case, in the balance sheet, the Accused had acknowledged his liability. However it could be seen that, in the present case, there is no such pleading or proof so as to hold that, the claim of the Complainant is saved by limitation.
52. Further, I also rely upon the decision of our Hon'ble High Court in the case of K.N.Raju Vs., Manjunath T V in Cr.A.No.302/2010 decided on 16.3.018, which is also on the same point that, as per Article 21 and Sec.18 and 19 of the Indian Limitation Act, when there is an acknowledgment of debt in writing by the borrower within the prescribed period of three years from the date of 31 C.C.No.16375/2016 J borrowing of the loan, then a fresh period of limitation shall be computed from the said date.
53. Therefore, from the materials available on record, this court has no hesitation to hold that, the complaint is bound to fail due to the aforesaid point of law.
54. Now coming to the matter on merits, it is seen that the crucial defence of the Accused in this case is with regard to the very existence of the alleged loan transaction as well as with regard to the financial capacity of the Complainant, in having allegedly advanced a huge loan of Rs.81 Lakhs to the Accused.
55. In this regard, it is pertinent to note that, the Complainant has been extensively by the learned Defence counsel. Admittedly at the initial stage, except the cheqeu in question, there was no other document in support of the financial status of the Complainant and in relation to the transaction in question was produced by the Complainant.
56. It could be seen that, it is subsequent to the stage of his cross-examination in this regard that the Complainant has produced his IT documents as per Ex.P17 to P23 to substantiate his claim that he had the requisite financial capacity at the relevant point of time.
32 C.C.No.16375/2016 J57. In this regard, it could be seen that, at the initial phase of the cross-examination of the Complainant, it is elicited from him that, he had approached the Accused in the year 2010 to invest in the Futureware which the former intended to incorporate during the said year, assuring him that, if he did so, he would be made the Director in the board of Directors of the said company.
58. This admission elicited from the Complainant is relevant so as to conclude that as on 2010 the financial status of the Accused was well known to the Complainant at least to the extent of expecting the Accused to invest in the company Futureware.
59. Likewise the initial constitution of the company Futureware and the subsequent inclusion of the Accused to the said company in the month of October or November 2010 as pr the MOA and Articles of Association as per Ex.D1 is admitted by the Complainant.
60. Likewise it is also elicited from the Complainant that, he and his friend H D Ramesh had invested Rs.50,000/= each towards the initial capital and that the Accused has invested Rs.1 Crore to the said company, though according to the Complainant, the investment by 33 C.C.No.16375/2016 J the Accused to the said company was not at one stretch, but that he has lent Rs.35 Lakhs to the Accused.
61. These admissions elicited from the Complainant leads to an inference with regard to the comparative financial status of the Accused and the former.
62. It is relevant to note that, during the subsequent cross-examination of the Complainant, it is also elicited from him that, during the year 2005 he had availed a loan on his site and that he had received a notice from the bank for the non-repayment of the loan in the year 2012. He has also admitted the suggestion that, he had spoken to his bank for one time settlement of the said loan in the year 2012.
63. However the aforesaid admissions elicited from the Complainant makes it clear that, during the period of 2012, there were personal financial constraints that were being faced by the Complainant himself. In such circumstance, the normal human conduct would be that the person would be interested to clear his own personal commitments rather than helping some other/s, whatever be the intimacy of relationship between them. therefore the conduct of the Complainant in claiming that when he himself was facing pressure from his bank for the 34 C.C.No.16375/2016 J repayment of the loan, he has advanced a huge loan of Rs.81 Lakhs to the Accused by way of cash, that too without obtaining any document from him and without charging any interest on such loan seems to be a highly unbelievable and suspicious claim.
64. No doubt it is elicited from the Accused in his cross-examination by the learned counsel for the Complainant that, four or five of his bank accounts were frozen during the relevant period, but the Accused has clearly denied the suggestion that, at the time of the said Income Tax Survey, he had some financial crisis and that at that time, he had told the Complainant that all his accounts were frozen. In such circumstance, when the Accused has denied about all his accounts having been allegedly frozen, the onus of proving the same is shifted in favor of the Complainant, which he has failed to do.
65. However it is pertinent to note that, it is also specifically elicited from the Complainant that he has no document to show that he had Rs.81 Lakhs with him at the relevant period.
66. It is interesting to note that, for the first time, the Complainant has introduced a new version in his cross- examination with regard to the source of Rs.81 Lakhs with 35 C.C.No.16375/2016 J him by claiming that he has borrowed the amount from his friends and relatives and that he had his savings with which he was able to organize the said amount. Interestingly the Complainant has neither pleaded nor proved such alleged borrowing of the amounts from his friends and relatives. As such there is absolutely no proof led by the Complainant in this regard.
67. It is relevant to note that, the Complainant has produced the IT documents of his wife and him as per Ex.P17 to P23 concerning the Assessment years from 2008-09 to 2012-13 and 2011-12, 2012-13 respectively.
68. However the learned Defence Counsel has successfully elicited from the Complainant in his cross- examination that, as per the said IT returns, the gross total income of him and his wife for the Assessment year 2011- 12 was Rs.19,08,558/= and Rs.19.67,686 for the Assessment year 2012-13. He has also deposed that he ash not declared about his alleged lending of Rs.81 Lakhs to the Accused in his IT Returns. Though the Complainant has denied the suggestion that, during the year 2011-12 and 2012-13, he himself had no sufficient funds to the tune of Rs.81 Lakhs, he could not have lent such huge loan to the Accused, the documentary evidence would 36 C.C.No.16375/2016 J prevail over the contrary oral evidence of the Complainant in this regard.
69. It is seen that, it is also successfully elicited from the Complainant that, as per the Vouchers at Ex.D6 to D9, he himself has received the respective amounts shown therein from the Accused towards his share of investment to M/s. Futureware. Though subsequently the Complainant has claimed that, the Accused has invested in the said company by having received some amounts from him, he has admitted that, he has not produced any document in this regard.
70. Therefore, even the argument of the learned counsel for the Complainant in this regard to the effect that, after having borrowed the amount of Rs.81 Lakhs from the Complainant in cash, the Accused has indirectly invested from out of the said amount to the company M/s.Futureware is not supported by any substantive proof.
71. Therefore the documentary and the ocular evidence in this regard clearly leads to an inference that the Complainant has utterly failed to prove his financial capacity to advance a huge loan of Rs.81 Lakhs to the Accused at the relevant point of time. Therefore I have no hesitation to hold that the case of the Complainant suffers 37 C.C.No.16375/2016 J from serious doubt in view of his failure to prove his financial capacity as well.
72. It is interesting to note that, when the Accused has deposed in his chief examination about his financial status and his investments in the Futureware, there is absolutely no challenge to the same in his cross- examination by the could for the Complainant.
73. In this regard, the Accused has relied upon the documentary evidence being his Bank passbooks as per Ex.D2, his statements of accounts as per Ex.D3, the Payment vouchers as per Ex.D3 to D12, two RTGS vouchers as per Ex.D13 and D14, his Vijaya Bank Passbook as per Ex.D18. Interestingly there is absolutely no cross-examination of the Accused by the learned counsel for the Complainant in respect to this documentary evidence in particular. As such the defence of the Accused in the light of the aforesaid documentary evidence has remained unchallenged.
74. It is pertinent to note that, though the Accused has been cross-examined by the learned counsel for the Complainant, but nothing crucial is elicited from him in contrast to his defence in the light of the aforesaid documentary evidence.
38 C.C.No.16375/2016 J75. No doubt it is elicited from the Accused that there was an income tax survey on 17.9.2010 against him and his own office, but he has denied the suggestion that in view of the same, he had approached the Complainant and availed a loan of Rs.81 Lakhs from him to overcome such financial crisis.
76. Likewise he has deposed to the suggestion that, he used to lend loans as well as borrow loans.
77. It could be seen that though during the course of his further cross-examination, it is suggested to the Accused about the other cheque bounce cases filed against him by others as well as the result of such cases, but the said facts do not lead to an inference that the liability of the Accused in this case could be decided on the basis of such judicial findings given in such other cases. It is a well settled position of law that, each case has to be decided independently without being influenced by the judgment in some other court, whether it be of the same court or some other court.
78. Therefore the documentary evidence of the Complainant at Ex.P.9 to P16, being the certified copies of the judgment, complaint and the affidavits of the respective 39 C.C.No.16375/2016 J Complainants therein do not help this Complainant in proving the guilt of the Accused in the present case.
79. No doubt the said documentary evidence may be a corroborative piece of evidence, but that by itself does not help the case of the Complainant with regard to the alleged liability of the Accused in the present case.
80. Now coming to the defence version as pleaded and proved by the Accused in the present case with regard to the cheque in question being in the custody of the Complainant is concerned, though there is some slight contradiction in the version of the Accused, I have no hesitation to hold that the same is not improbable for the reasons which are going to be discussed hereinafter.
81. It could be seen that the defence of the Accused with regard to his cheque is the defence of the "Cheque lost theory".
82. In the light of this specific defence, while cross- examining the Complainant, it is suggested to him that the cheqeu in question was lost by the Accused.
83. According to the Accused he had lost few of his cheques, among whom, few were signed by him and that 40 C.C.No.16375/2016 J he had lodged a complaint in this regard to the Shankarapuram Police on 9.11.2009 and that the cheque in question was one among such lost cheques. Hence he has alleged that he suspected the Complainant has stolen such cheques which were in his office. It is also alleged by the Accused that on the basis of such stolen cheques, the Complainant has got filed similar cheque bounce cases against him by various other persons.
84. It could be seen that, in support of this defence version, the Accused has relied upon the documentary evidence as per Ex.D16 and the copy of the Complaint dated 9.11.2009 as per Ex.D17. Admittedly there is a list of several cheques found in Ex.D17, which according to the Accused were lost while travelling from his office towards the City Market on the Shankar Mutt Road.
85. No doubt, in this regard, it is argued by the learned counsel for the Complainant that, there is a contradiction the claim of the Accused as to where he has allegedly lost his cheques. But the point that is to be noted by this court is that, the defence of the Accused is consistent so far as the alleged loss of his cheque leaves is concerned.
41 C.C.No.16375/2016 J86. In this regard, it is difficult to accept the argument of the learned counsel for the Complainant that, with a pre-determined mind, the Accused had lodged the complaint as per Ex.D17 so as to deceive his creditors, before the issuance of the cheques to his creditors. This argument cannot be accepted as tenable, since no person could anticipate that, after 6 or 7 years he is going to issue a particular cheqeu to a particular individual. Therefore the argument of the learned counsel for the Complainant in this regard cannot be accepted by this court.
87. Moreover the cheque in question is returned as "Required Information not legible/correct". Interestingly the Complainant has not offered any explanation as to what does the said endorsement as per Ex.C2 mean and what steps he has taken after the receipt of the cheque return memo as per Ex.C2. The benefit of this circumstance also must be extended to the Accused.
88. No doubt the Accused has also raised the technical defence of the alleged non-service of the legal notice on him by claiming that the legal notice is returned with postal shara as "Door Locked, Intimation Delivered"
as per Ex.C6. However except having suggested to the Complainant about the same, subsequently there is no serious dispute with regard to the same by the Accused.42 C.C.No.16375/2016 J
89. Even otherwise, the position of law in this regard is also set at rest in view of the decision of the Hon'ble Apex Court in the case of CC Alavi Haji Vs., Palapetty Muhammed and ano., reported in 2007 AIR SCW 3578, wherein it is clearly held that:-
"The drawer of the cheque is permitted to deposit the cheque amount within 15 days from the date of his appearance before the court in pursuance of the service of summons on him and in such situation, his defence of non-service of the legal notice cannot be available to him".
90. In view of the law laid down in the afore-cited decision by the Hon'ble Apex Court, the Accused cannot succeed only on the technical defence of the alleged non- service of the legal notice on them, if the Complainant in a given case, is able to establish the existence of the legally payable debt by the Accused in his favour by relying upon the other evidence on record. Therefore without hesitation, I conclude that, the Accused has failed to establish the technical defence of the alleged non-service of the legal notice on him.
43 C.C.No.16375/2016 J91. Therefore the appreciation of the entire evidence on record clearly goes to show that, the Complainant has miserably failed to establish the fact the cheque in dispute was issued by the Accused to him towards the discharge of his legally payable debt and as such, the case of the Complainant is highly suspicious.
92. Even otherwise as already discussed, the case of the Complainant is also not maintainable in view of the bar of limitation and as such, even if there existed any liability on the part of the Accused towards the Complainant, admittedly, as on the date of the issuance of the cheque in question by the Accused to the Complainant, the said debt and liability had become time barred and hence legally un- enforceable.
93. Moreover the Complainant has also miserably failed to prove his financial capacity to the tune of Rs.81 Lakhs at the relevant point of time. Hence it could be seen that, both on merits as well as on the point of limitation, the case of the Complainant is bound to fail. Accordingly, I proceed to pass the following:-
ORDER By exercising the power-conferred u/s 255(1) of Cr.P.C. the Accused is hereby acquitted of the offence punishable u/s 138 of the Negotiable Instruments Act.44 C.C.No.16375/2016 J
His bail bond and surety bond stands discharged.
(Dictated to the Stenographer online, transcript thereof is computerized and print out taken by her, verified, corrected and then pronounced by me in the open Court on this the 15th day of September, 2018).
(SARASWATHI.K.N), XVI ACMM., Bengaluru City.
ANNEXURE
1. List of witness/s examined on behalf of the Complainant:-
PW.1 : Sri.Mallikarjunaiah H.M;
2. List of documents exhibited on behalf of the
Complainant:-
Ex.C1 :
Original cheque dated 17.1.2016;
Ex.C-1(a) :
Signature of the Accused;
Ex.C-2 Cheque Return Memo;
:
Ex.C-3 :
Office copy of the legal notice;
Ex.C-4 :
Postal Receipt;
Ex.C-5 :
Un-served Legal Notice;
Ex.C-6 :
Postal Envelope;
Ex.C-7 :
Postal Receipt;
Ex.C-8 :
Postal Acknowledgment;
Ex.P-9 and 10 :
The certified copies of the judgment and complaint of C.C.No.21060/2016;
Ex.P11 and 12 : The certified copies of the Private complaints of PCR No.13805/2015 and 13806/2015;
Ex.P13 to 16 : The certified copies of the complaints of C.C.No.5756/2015, 3153/2015, 4774/2015 and 9753/2015;
45 C.C.No.16375/2016 JEx.P17 and 18 : IT Returns of 2011-12 and 2012-13; Ex.P19 to 23 : The IT Returns of 2008-09 to 2012-13.
3. List of witnesses examined on behalf of the Accused:-
DW-1 : Sri.T.G.Ranganath;
4. List of documents exhibited on behalf of the Accused:-
Ex.D-1 : Memorandum of Association and Articles of Association;
Ex.D-2 : Bank Passbook;
Ex.D-3 : Bank Statement;
Ex.D-4 to 12 : 9 Vouchers;
Ex.D-4(a), 6(a),
8(a) and 11(a) : Signatures of the Complainant;
Ex.D-9(a) : Signature of Sri.H.D.Ramesh;
Ex.D-13 and 14: 2 RTGS Vouchers;
Ex.D-15 : Copy of the complaint dated
24.1.2017;
Ex.D-16 : Copy of the statement dated
12.5.2017;
Ex.D-17 : copy of the complaint dated
9.11.2009;
Ex.D-18 : Vijaya Bank Passbook.
(SARASWATHI.K.N),
XVI ACMM, Bengaluru City.
46 C.C.No.16375/2016 J
15.9.2018
Judgment pronounced in the open court vide separate order.
ORDER
By exercising the power
conferred u/s 255(1) of Cr.P.C., the Accused is hereby acquitted of the offence punishable u/s 138 of Negotiable Instruments Act.
His bail bond and surety bond stands discharged.
XVI ACMM, B'luru.