Bangalore District Court
T.R. Ramaiah vs Suhashini.P Joshi on 1 August, 2024
0KABC020115722019
IN THE COURT OF ADDL. CHIEF JUDICIAL
MAGISTRATE, BENGALURU CITY.
(SCCH6)
Present: Smt. Chetana S.F.
B.A., L.L.B.,
IV Addl., Small Cause Judge & ACJM,
Court of Small Causes,
Bengaluru.
CC. No. 2513/2019
DATED THIS THE 1ST DAY OF AUGUST, 2024
COMPLAINANT/S Sri. T.R. Ramaiah,
S/o. Late Rangashamaiah,
Aged above 72 years,
R/at No.34,
3rd Main Road,
1st Phase, 2nd Stage,
Manjunathnagar,
Bangalore 560010.
(By Sri. S.Kumar, Advocate)
Vs
ACCUSED Smt. Suhashini P. Joshi,
W/o. Bhushan.R.,
Aged about 38 years,
Yashoda Health Care
Old age Homes,
R/at, No.88/1 D,
Modi Hospital Road,
SCCH-6 2 CC No.2513/2019
Near Shankar Mutt Circle,
Basaveshwara Nagar,
Bengaluru 560079.
(Sri. H.M.Anand, Advocate)
: J U D G M E N T :
This is a complaint filed by the complainant U/Sec. 200 of
Cr.P.C. for the offense punishable under Sec.138 of N.I. Act as
against the accused praying to punish the accused for the said
offence.
2. The case of the complainant is that, the complainant is
retired LIC officer, the accused and complainant are family friends
for several years, the accused was intended to open a Health care
and old age homes but, he has no money for investment, as
accused and complainant are good friends and in view of the
cordial relationship between them, the accused approached the
complainant for financial assistance of Rs.10,00,000/ to start
health care and old age homes business during the month of
January 2016. Hence the complainant has arranged the sum of
Rs.10,00,000/ by way of cash as per the accused requirement
and handed over the same to the accused by way of cash in the
SCCH-6 3 CC No.2513/2019
presence of the witness on 08.01.2016. Thereafter, during the 1st
week of January 2019, complainant approached the accused for
repayment of the above said loan amount. But, accused neglected
and avoided to repay the loan amount. After repeated demand,
towards the repayment of the amount, the accused issued a
cheque bearing No.918718 amounting to Rs.10,00,000/
dt.09.03.2019. The complainant presented the said cheque for
encashment through his banker Vijaya Bank, Moodlupalya,
Bengaluru72, but the said cheque came to be dishonoured and
returned with an endorsement "Funds Insufficient" and the same
was intimated on 12.03.2019 by the branch office, the Janatha
Coop Bank, Malleshwaram Branch memo from the complainant's
bank. Thereafter, complainant got issued legal notice on
25.03.2019 through registered post acknowledgment to the
accused and the said notice was served to the accused on
29.03.2019 and RPAD post cover returned to the complainant
with an endorsement "Refused" on 02.04.2019. The accused has
not paid the amount. Accordingly, the accused has committed an
offence punishable under Sec.138 of N.I Act. Hence, this
SCCH-6 4 CC No.2513/2019
complaint.
3. After recording the sworn statement of the complainant
and also verifying the documents, cognizance was taken against
the accused for the offence punishable under Sec. 138 of N.I. Act.
The accused appeared before this Court through her counsel and
she was enlarged on bail and her plea was recorded. The accused
pleaded not guilty and claimed to be tried. Hence, the case was
posted for evidence of the complainant.
4. The complainant got examined himself as PW.1 and got
marked 6 documents as Exs.P.1 to 6. Thereafter, the case was
posted for recording the statement of accused under Sec.313 of
Cr.P.C. In the statement U/s. 313 Cr.P.C., the accused has
denied all the incriminating evidence appearing against her and
claimed to be tried and did not choose to lead evidence on her
behalf.
5. Heard the arguments of both side and Perused the
records.
6. The following points arise for my consideration:
SCCH-6 5 CC No.2513/2019
1.Whether the complainant proves that the cheque No.918718 amounting to Rs.10,00,000/ dated 09.03.2019 drawn on Vijaya Bank, Moodlupalya Branch, Bengaluru560072, issued by the accused have been dishonored with an endorsement 'Funds Insufficient' and even after receiving the intimation regarding the dishonor of cheque failed to pay the cheque amount within the stipulated period and thereby the accused has committed an offence punishable under Sec.138 of N.I. Act?
2. What order?
7. My findings on the above points are as under
Point No.1: In the Negative, Point No.2: As per final order for the following:
: R E A S O N S :
8. POINT NO.1: In view of the present legal position as held by our Hon'ble High Court as well as Apex Court of India in a catena of decisions as well as relevant provisions of the Act, this court has to see whether the complainant has complied all the requirements as contained in Sec.138 of NI Act so as to bring home the guilt of the accused for the SCCH-6 6 CC No.2513/2019 alleged offence. If so, whether the accused is able to rebut the legal presumption available to the complainant under Sec.139 of the Act by adducing probable defense or not. However, it is held by the full bench of our Apex Court in the case of Rangappa Vs. Mohan reported in 2010 (1) DCR 706 that;
"The Statutory presumption mandated by sec.139 of the Act, does indeed include the existence of a legally enforceable debt or liability. However, the presumption U/S 139 of the Act is in the nature of a rebuttable presumption and it is open for the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested".
9. Therefore, in view of the above decision, once the cheque is admitted, the statutory presumption would automatically fall in favour of the complainant that, the alleged cheque was issued for discharge of an existing legally enforceable debt or liability against the accused and the burden will shift on to the accused to rebut the same.
SCCH-6 7 CC No.2513/2019
INGREDIENTS OF OFFENCE AND DISCUSSION:
10. Before dwelling into the facts of the present case, it would be apposite to discuss the legal standards required to be met by both sides. In order to establish the offence under Section 138 of NI Act, the prosecution must fulfill all the essential ingredients of the offence. Perusal of the bare provision reveals the following necessary ingredients of the offence: First Ingredient: The cheques were drawn by a person on an account maintained by him for payment of money and the same is presented for payment within a period of 3 months from the date on which it is drawn or within the period of its validity;
Second Ingredient: The cheques were drawn by the drawer for discharge of any legally enforceable debt or other liability;
Third Ingredient: The cheques were returned unpaid by the bank due to either insufficiency of funds in the account to honour the cheque or that it exceeds the SCCH-6 8 CC No.2513/2019 amount arranged to be paid from that account on an agreement made with that bank;
Fourth Ingredient: A demand of the said amount has been made by the payee or holder in due course of the cheque by a notice in writing given to the drawer within thirty days of the receipt of information of the dishonour of cheque from the bank;
Fifth Ingredient: The drawer fails to make payment of the said amount of money within fifteen days from the date of receipt of notice.
APPRECIATION OF EVIDENCE
11. The accused can only be held guilty of the offence under Section 138 NI Act if the abovementioned ingredients are proved by the complainant coextensively. Additionally, the conditions stipulated under Section 142 NI Act have to be fulfilled. Notably, there is no dispute at bar about the proof of only first, SCCH-6 9 CC No.2513/2019 third, and fifth ingredient. The complainant had proved the original cheque vide Ex.P1 which the accused person had not disputed as being drawn on the account of the accused. It was not disputed that the cheque in question was presented within its validity period. The cheque in question was returned unpaid vide return memo dated 12.03.2019 vide Ex.P2 due to the reason, "Funds insufficient". The complainant had proved the service of legal demand notice dated 25.03.2019 vide Ex.P3 by bringing on record the postal receipt vide Ex.P4 and returned postal cover vide Ex.P5. However, the accused person has not denied the receipt of the legal notice. Thus, there is a dispute with regard to the fifth ingredient to the offence. As such, the first, third and fourth ingredient of the offence under section 138 of the NI Act stands proved.
12. As far as the proof of second ingredient is concerned, the complainant has to prove that the cheque in question was drawn by the drawer for discharging a legally enforceable debtor any liability. In the present case, the issuance of the cheque in question is not denied. As per the scheme of the NI Act, once the SCCH-6 10 CC No.2513/2019 accused admits signature on the cheque in question, certain presumption are drawn, which result in shifting of onus. Section 118(a) of the NI Act lays down the presumption that every negotiable instrument was made or drawn for consideration. Another presumption is enumerated in Section 139 of NI Act. The provision lays down the presumption that the holder of the cheque received it for the discharge, in whole or part, of any debt or other liability.
13. The combined effect of these two provisions is a presumption that the cheque is drawn for consideration and given by the accused for the discharge of debt or other liability. Further, it has been held by a threejudge bench of the Hon'ble Apex Court in the case of Rangappa vs. Sri Mohan (2010) 11 SCC 441 that the presumption contemplated under Section 139 of NI Act includes the presumption of existence of a legally enforceable debt. Once the presumption is raised, it is for the accused to rebut the same by establishing a probable defence.
14. The presumptions raised under Section 118(b) and Section 139 NI Act are rebuttable presumptions. A reverse onus is SCCH-6 11 CC No.2513/2019 cast on the accused, who has to establish a probable defence on the standard of preponderance of probabilities to prove that either there was no legally enforceable debt or other liability. In this case, the arguments raised by the Ld. counsel for the accused to rebut the presumption are discussed below:
15. According to the complainant, himself and accused are good friends and accused has number of business. In view of the cordial relationship between them, the accused approached the complainant for financial assistance in the year 2015 December for his urgent commitments and purchasing the lands for making sites as developer and real estate business and assured him to returned back within three years. complainant as per the demand of the accused he arranged a sum of Rs.10,00,000/ by way of cash and accused borrowed a loan of Rs.10,00,000/ in the presence of witness and promised to pay back within three years As per the accused words promise the complainant demanded his money from the accused in the month of November 2019, but accused neglected and go on postponing the same and in October 2020 accused has given the post dated cheques on 21.12.2020 for SCCH-6 12 CC No.2513/2019 clearing the loan amount to be presented on 21.12.2020 and the same was dishonored and returned with an endorsement 'account closed'.
16. Accused has taken the specific defence that accused has taken the loan of Rs.1,50,000/ from the complainant and at that time, he has given a cheque as security and lateron he has repaid the same in cash and in spite of that, PW.1 has misused the cheque and filed this false complaint.
17. Apart from this accused has taken another defence that according to the complainant himself he has given the loan in the year 08.01.2016 and accused has given the cheque in october 2020 for the repayment of the said loan. Hence, present transaction is time bar debt and complainant cannot claim the cheque amount, which was issued for the repayment of the said time bar debt as it does not amounts to the legal recoverable debt.
18. In this regard the learned counsel for the accused crossexamined PW.1 at length, wherein, PW.1 has clearly stated that on 08.01.2016 he has given the loan of Rs.10,00,000/ to the accused and he has asked the accused for the repayment of the SCCH-6 13 CC No.2513/2019 said loan in September 2019 and accused has given the cheque after 3 years from the date of lending. Even PW.1 has clearly admitted that ಆರರರರಪತರರ ಚರಕಕ ಅನರನ ಕರರಟಟರರತತತರರ ಎಎದರ ಹರರಳರವ ಕತಲಕರಕ ನತನರ ಆರರರರಪತರಗರ ಹಣ ಕರರಟರಟ 3 ವರರ ಮರಗದರರತತದರ ಎಎದರರ ಸರ. ಆರರರರಪತರರ ನತನರ ಹಣ ಕರರಟಟ 3 ವರರದ ನಎತರ ನನಗರ ಚರಕಕ ಅನರನ ಕರರಟಟರರತತತರರ . Thus, PW.1 has categorically admitted that after 3 years of transaction, accused has issued cheque. Even PW.2 was aware of that fact.
19. In this regard this court relied on the decision Bidar Co Operative Bank Ltd. V/s Girish wherein it was held that, when there is no debt or liability exists, then the said cheque amount will not become legally recoverable debt or other liability, the offence under section 138 of Negotiable Instrument Act will not sustain. Further Hon'ble High Court of Karnataka elaborately discussed the scope of Section 25(3) of the Indian Contract Act and referred the decision reported in CHACKO VARKEY VS THOMMEN THOMAS AIR 1958 Ker 31 a Full Bench of the Kerala High Court considered the scope of section 25(3) of the SCCH-6 14 CC No.2513/2019 Indian Contract Act 1872 which also supports the accused defense.
20. Further relied on the decision reported in the Kerala High Court in a decision reported in 2001 Crl.L.J 24 in case of Sasseriyal Joseph Vs Devassia, held that section 138 of the Act is attracted only if there is legally recoverable debt and it cannot be said that time barred debt is legally recoverable debt. The said Judgment rendered by Kerala High Court in Sasseriyil Joseph's case was challenged before the Hon'ble Supreme Court in Special Leave to Appeal (Crl.) No.1785/2001 by Hon'ble Supreme Court by Judgment dated:10092001 affirmed the said view of Kerala High Court and it is held as under:
"We have heard learned counsel for the petitioner. We have perused the judgment of the High Court of Kerala in Criminal Appeal No. 161 of 1994 confirming the judgment/order of acquittal passed by the Addl. Sessions Judge, Thalassery in Criminal Appeal No. 212 of 1992 holding inter alia that the cheque in question having been issued by the accused for due which was barred by limitation SCCH-6 15 CC No.2513/2019 the penal provision under Section 138 of the Negotiable Instruments Act is not attracted in the case.
21. In view of the principles stated in the above referred decision and discussion it is evident that the penal provision of Section 138 of the N.I.Act is applicable only to the cheques which are issued for the discharge in whole or in part, of any debt or other liability, which according to Explanation must be a legally enforceable debt or other liability. A cheque given in discharge of a time barred debt will not constitute an unconditional undertaking or promise in writing either expressly or impliedly so as to attract the criminal offence under section 138 of N.I Act. A cheque given in discharge of a time barred debt will not constitute a promise in writing not even an implied promise so as to attract a criminal liability under Section 138 of N.I Act.
22. In the present case, admittedly PW1 is claiming the amount alleged to have lent in the year 2016 in the year 2020 which is almost after 4 years and it clearly shows that alleged debt if any is a time barred debt and as such it is not the legally SCCH-6 16 CC No.2513/2019 enforceable debt and a cheque given in discharge of the time bar debt will not constitute and unconditional undertaking or a promise in writing either expressly or impliedly so as to attract criminal liability u/s 138 of the NI Act. As such the complainant cannot claim the cheque amount alleged to be lent on in the year 2016 as it is time barred debt.
23. Apart from this, PW.1 clearly admits that there is no documents to show that he has lend the loan of Rs.10,00,000/ to him. PW.1, being a retired LIC Development Officer, how can he lend so much of huge amount to any person even to a friend or a relative without any single document in proof of the same. It is highly unbelievable and ordinarily no prudent man would lend so much of huge amount without executing any document in proof of the same. As such, the passing of the consideration of so much of huge amount appears to be doubtful.
24. Though complainant has taken the contention that on that date he has withdrawn the amount of Rs.10,00,000/ from his bank account and given the same to the accused. further in support of his version, he has produced the bank statement SCCH-6 17 CC No.2513/2019 Ex.P.6, which shows that on 08.01.2016, he has withdrawn an amount of Rs.10,00,000/ but, it cannot be said that PW.1 has lend the same amount to the accused in the absence of any materials and documents on record.
25. Apart from this though PW.1 has stated in presence of witness he has lent the loan but has not stated who are all the witnesses in presence of whom he has lend the loan and also not examined them.
26. Apart from this even PW.1 has not explained any reasons as to why he has lend the loan through the cash and what prevented him to transfer the same through bank account and also why he has not maintained or executed any document at the time of lending the loan.
27. Thus in view of the appreciation of the evidence and materials on record it reveals that the very silence of the PW.1 and nonproduction of any document at the time of lending of the loan and claiming of the alleged loan amount after the expiry of the period of limitation makes the case of the complainant fully doubtful. Hence, in view of the said facts and circumstances, it SCCH-6 18 CC No.2513/2019 can be said that the complainant has failed to establish his case. On the other hand the defence taken by the accused appears to be more probable.
Conclusion:
28. In view of all the above discussion, it can be concluded that the complainant has failed to establish through cogent and convincing evidence, the fact of issuance of the cheque for discharge of legally enforceable debt or any liability, which is dishonored for want of sufficient funds. On the other hand, the accused has successfully rebutted the presumption available to the complainant through probable evidences, that would preponderate upon the evidence led by the complainant. Therefore, the accused is held to have not committed an offence punishable under sec. 138 of N.I. Act. Accordingly, point No.1 is answered in the NEGATIVE.
29. POINT NO.2: In view of my answer to Point No.1, I proceed to pass the following: SCCH-6 19 CC No.2513/2019 : O R D E R : Acting under Section 278(1) of the Bharatiya Nagarik Suraksha Sanhita, 2023, accused is acquitted for the offence punishable under Section 138 of NI Act.
The bail and surety bond of the accused and surety shall stand canceled.
(Dictated to the Stenographer, transcribed and computerized by her. Script corrected, signed and then pronounced by me in open Court this the 1st day of August, 2024).
(CHETANA S.F.) IV Addl., Small Cause Judge & ACJM, Court of Small Causes, Bengaluru.
ANNEXURE List of witnesses examined for the Complainant:
P.W1 :T.R. Ramaiah List of witnesses examined for the accused: Nil List of documents marked for the Complainant: Ex.P.1 : Cheque Ex.P.1(a) : Signature of accused Ex.P.2 : Bank Endorsement SCCH-6 20 CC No.2513/2019 Ex.P.3 : Legal Notice Ex.P.4 : Postal Receipt Ex.P.5 : Returned Postal Cover Ex.P.6 : Bank Statement List of documents marked for the accused: Nil (CHETANA S.F.) IV Addl. Small Cause Judge & ACJM, Court of Small Causes, Bengaluru.