Bangalore District Court
Cauvery Electricals Pvt Ltd vs Mls Electricals on 18 April, 2024
KABC020023062023
IN THE COURT OF XXIV ADDITIONAL SMALL CAUSES
JUDGE, & A.C.M.M. AT: BENGALURU
(SCCH-26)
DATED THIS THE 18th DAY OF APRIL 2024
PRESENT : SRI. APPASAB NAIK,
B.A.L.L.B.(Spl)
XXIV ADDL. SCJ & ACMM
BENGALURU.
1. Sl. No. of the Case CC. No.12591OF 2021
2. Name of the M/s. Cauvery Electrical's Pvt Ltd
Complainant Registered Office at No.237,
Chickpet Main Road,
Shanthaveeraiah lane,
Bengaluru-5600053
Represented by its
Director/Authorized representative
Sri.K.Anil kumar.
(By Sri. Devaraju. R - Advocate)
3. Name of the Accused 1. M/s. MLS Electrical's
Office At Sri. Yelukoti Nilaya,
2nd stage,2nd Main, 3rd cross,
CDA Layout, Kalyan Nagar,
Chikkamagaluru-577102
Represented by its proprietor/
Authorized signatory
Sri.G.S.Anil kumar.
2. Sri.G.S.Anil kumar.
Represented by its proprietor/
Authorized signatory
M/s.MLS Electrical's
Office At Sri. Yelukoti Nilaya, 2 nd
stage,2nd Main, 3rd cross, CDA
Layout, Kalyan Nagar,
Chikkamagaluru-577102
(By Sri.Onkara .K.B - Advocate)
SCCH - 26 3 CC No.12591/2022
4. The offence U/s.138 of the Negotiable
complained of Instruments Act
5. Opinion of the judge Accused found guilty
JUDGMENT
The complainant has filed this complaint Under Section 200 of Cr.P.C against the accused alleging that the accused has committed an offence punishable Under Sec.138 of the Negotiable Instruments Act, 1881. (In short N.I.Act).
2. The brief facts of the complainant's case are as under :
It is the case of the complainant that, accused No.2 is the authorized signatory of the accused No.1 company and involved in the day to day activates and business of the accused No.1 company. Accused is the customer of the complainant, he has purchased various kinds of the electrical goods at Bengaluru on credit basis under various invoices from time to time and as per the regular accounts maintained by the complainant and accused is liable to pay due amount of Rs.10,16,184/- to the complainant.
SCCH - 26 4 CC No.12591/2022
3. It is further stated that after repeated request made by the complaint to accused to clear the due amount, but accused did not clear the due amount, the complainant had issued demand notice on 11-04-2019 to the accused, after receiving the notice accused has not made any payment to the complainant. The complainant had filed a suit for recovery of the said due amount with interest in Com.O.S.No. 319/2019 before the Hon'ble City Civil and Sessions Judge at Commercial court Bengaluru against the accused. During the pendency of suit, accused has agreed his liabilities to clear the due amount of Rs.10,16,184/-to the complainant, on the basis of settlement both parties have filed compromise petition in Com.O.S. No.319/2019 and suit was decreed as per compromise petition on 25-06-2022.
4. It is further stated that at the time of entering the compromise towards the compromise amount of Rs.10,16,184/-, accused has signed and issued two posted cheques bearing No.110188 dated 05-09-2022 for a sum of Rs.5,00,000/- and cheque bearing No.,110189 SCCH - 26 5 CC No.12591/2022 dated 25-11-2022 for a sum of Rs.5,16,184/- both cheques drawn on Canara bank chikkamangaluru town branch in faovur of complainant and accused has assured to complainant that the said cheque will be honored on its presentation. The complainant has presented the cheque bearing No110188 dated 05-09-
2022 for a sum of Rs.5,00,000/- to his bankers Axis Bank Ltd Chikpet Branch Bengaluru for Encashment. The said cheque was dishonored on dated 06-09-2022 for the reasons that Exceeds Arrangement. The complainant had issued the legal notice to accused on 26-09-2022, the said legal notice duly served to the accused on 30-09- 2022. After service of legal notice, accused have not sent any reply to the notice nor paid the cheque amount. The accused has issued the said cheque towards discharging his liability to the complainant and knowing fully well about the issuance of cheque, accused deliberately maintained sufficient funds in his bank account. The accused has failed to pay the cheque amount. Hence, this complaint.
SCCH - 26 6 CC No.12591/2022
5. After perusing the contents of the complaint and documents, this court has taken cognizance of offence punishable u/s 138 of NI act and registered PCR. Thereafter, this court has recorded the sworn statement of the authorized person of the complainant firm and got marked 9 documents as Ex.P.1 to Ex.P.9. Since, the complainant has made out prima-facie case to proceed against accused, the case has been registered in Criminal Register No.III and issued summons to the accused. The accused, in response to the summons, He has appeared before this court and obtained bail. Thereafter, the plea of the accused has been recorded. He has pleaded not guilty and claims to be tried. The learned counsel for the complainant has submitted to adopt sworn statement of PW.1 and documents marked at Ex.P.1 to Ex.P.9 as complainant evidence. During the trial, the accused has filed application U/sec. 145(2) of NI Act seeking for permission to cross examination of Pw-1. The application is allowed on same day, the court was permitted to accused for cross examination of Pw-1, but sufficient SCCH - 26 7 CC No.12591/2022 opportunity given to accused to cross examination of Pw-
1. But accused has made effort to cross examination of the Pw-1, hence cross examination of Pw-1 is taken as nil. Thereafter, the statement of the accused u/s 313 Cr.P.C. has been recorded and he has denied the incriminating circumstances appearing against him in the complainant evidence. He has not chosen to lead defence evidence.
6. The following points arise for my consideration:-
POINTS
1. Whether the complainant proves beyond all reasonable doubt that the accused has issued cheque bearing No.110188 dt.05-09-
2022 for Rs.5,00,000/- drawn on Canara Bank Chikkamagaluru Branch, in his favour in discharge of the legally enforceable debt or liability and when the said cheque was presented to the Bank for encashment it was returned unpaid with remarks that "Exceeds Arrangement" and inspite of demand notice ,he has not paid the amount and there by committed the offence punishable under Sec.138 of Negotiable Instruments Act?
2. What order?
7. Heard arguments on complainant sides.
SCCH - 26 8 CC No.12591/2022 Accused has not appeared and no representation on behalf of accused, hence an argument on accused side is taken as Nil. Perused the entire documents placed on record.
8. My answers to the above points are as follows :-
Point No.1 : In the Affirmative.
Point No.2 : As per final order for the following:-
REASONS
9. POINT No.1:- It is the case of the complainant that accused is a customer of the complainant and purchased the various kinds of electrical goods on credit basis under various invoices. The accused is liable to pay the due amount of Rs.10,16,184/- to the complainant. the complainant has filed suit Com.O.S.No.319/2019 against the accused before the Hon'ble City Civil and sessions Judge at Commercial court (CCH-83) for recovery of due amount of Rs.10,16,184/-. The complainant and accused have filed compromise petition in Com.O.S.No.319/2019, as per compromise petition, the suit was decreed on 25-06-
SCCH - 26 9 CC No.12591/2022
2022. At the time of compromise in
Com.O.S.No.319/21019, the accused had issued two posted dated cheques in favour of complainant for payment of settlement amount.
10. The complainant has presented the cheque bearing No110188 dated 05-09-2022 for a sum of rs.5,00,000/- to his bankers Axis Bank Ltd Chikpet Branch Bengaluru for Encashment. The said cheque was dishonored on dated 06-09-2022 for the reasons that Exceeds Arrangement. The complainant had issued the legal notice to accused on 26-09-2022, the said legal notice duly served to the accused on 30-09-2022. After service of legal notice, accused have not sent any reply to the notice nor paid the cheque amount.
11. As already stated supra the authorized person of the complainant firm has examined himself as PW.1 and got marked 9 documents as Ex.P.1 to P.9. PW.1 has filed affidavit in lieu of examination-in-chief reiterating the entire averments of his complaint. Ex.P.7 is the certified copy of compromise petition in Com.O.S.No. SCCH - 26 10 CC No.12591/2022 319/2019, Ex.P.5 is the certified copy of order sheet in Com.O.S.No. 319/2019, Ex.P.6 is the certified copy of Decree in Com.O.S.No.319/2019. As per these documents, it appears that the accused has agreed to repay the same of Rs.10,16,184/- . Further it appears in EX.P4 in para No.3 that " Now that, both the palint and defendant have decided to amicably settle the issue, the defendant has agreed to pay the sum of pending outstanding amount of Rs.10,16,184/- to be paid. On 05- 09-2022 through cheque bearing No.110188 for a sum of Rs.5,00,000/- and another payment on 25-11-2022 through cheque bearing No.110189, both cheques are drawn on Canara Bank Chikkamangaluru Branch and the defendant also agreed to pay deficit amount, if any order by the Hon'ble court. The defendant also agreed that, if the said cheques will not honored, he shall bear the costs and consequences and also agreed to pay Bank penal interest."
12. Ex.P.2 is the cheque dt.05.09.2022 and Ex.P.3 is the bank endorsement dt.06.09.2022. As per these SCCH - 26 11 CC No.12591/2022 documents, it appears that the complainant has presented the cheque for collection at his banker and the same has been returned to him with endorsement "Exceeds arrangements". Ex.P.7 legal notice dt.26-09- 2022, Ex.P.8 is postal receipt and Ex.P.9 is the postal acknowledgments. As per these documents, it appears that the complainant has issued legal notice to the accused demanding him to pay the cheque amount within 15 days from the date of receipt of notice. The authorized person of the complainant has filed the present complaint on 31-10-2022. Therefore, the present complaint has been filed within time limit.
13. The documents produced by PW.1 clearly show that he has complied with the mandatory provisions of Section 138 of NI Act. Therefore, it gives raise to presumption in favour of complainant u/s 118 and 139 of NI Act. However, the presumptions available in favour of complainant are rebuttable in nature.
14. A careful scrutiny of the documents relied by the complainant goes to show that, the statutory SCCH - 26 12 CC No.12591/2022 requirements of section 138 of N.I. Act is complied with and this complaint is filed within time. The complainant has discharged his initial burden by examining its officials as PW1 and by production of documents. Thus, complainant is entitled to rely on the statutory presumptions enshrined under section 118 read with section 139 of N.I. Act.
15. The Section 118 reads as here: -
"That every negotiable instrument was made or drawn for consideration and that every such instrument when it has been accepted, endorsed, negotiated or transferred was accepted, endorsed, negotiated or transferred for consideration".
16. Further Section 139 of the Negotiable Instruments Act provides for presumption in favour of a holder. It reads as here: -
"It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in section 138, for the discharge, in whole or in part, or any debt or other liability."
A combined reading of above said sections raises a presumption in favour of the holder of the cheque that SCCH - 26 13 CC No.12591/2022 he has received the same for discharge in whole or in part of any debt or other liability.
17. No doubt, the said presumptions of law are rebuttable in nature. The accused can take probable defence in the scale of preponderance of probability to rebut the presumption available in favour of complainant. Let me examine whether the accused has successfully rebutted the said presumptions of law. In this back drop, this court has given anxious consideration to the materials available on record. At the outset, the accused has not disputed the issuance of cheque and his signature in the cheque by cross- examining the PW1. It goes without saying that, accused has not disputed the cheque in question and signature found therein. When the drawer has admitted the issuance of the cheque as well as the signature present therein, the presumptions envisaged under section 118 read with section 139 of NI Act, would operate in favour of the Complainant. The said provisions lays down a special rule of evidence SCCH - 26 14 CC No.12591/2022 applicable to negotiable instruments. The presumption is one of law and thereunder the court shall presume that the instrument was endorsed for consideration. So also, in the absence of contrary evidence on behalf of the accused, the presumption under section 118 of the NI Act, goes in favour of the complainant. No doubt, said statutory presumptions are rebuttable in nature. As discussed above, when the complainant has relied upon the statutory presumptions enshrined under section 118 read with section 139 of NI Act, it is for the accused to rebut the presumptions with cogent and convincing evidence. To put it other way, the burden lies upon the accused to prove that cheque in question is not issued for discharge of debt or liability. It is worth to note that, Section 106 of Indian Evidence Act postulates that, the burden is on the accused to establish the fact which is especially within his special knowledge. This provision is exception to the General Rule that, the burden of proof is always on the prosecution to establish their case beyond all SCCH - 26 15 CC No.12591/2022 reasonable doubt. In that view of the matter, the burden is on the accused to prove that the cheque in question not issued for discharge of any liability. But despite of giving sufficient opportunities, the accused neither led defence evidence nor cross-examined the PW1. Therefore the evidence placed by the complainant is remained unchallenged and there is no reason to disbelieve the version of the complainant. There is no rebuttal evidence on behalf of the accused.
18. From the discussion made supra, it is clear that, the accused has neither taken probable defence nor taken steps to prove the same. To put it other way, the accused has not taken and proved probable defence to rebut the presumption of law available in favour of the complainant, envisaged under section 118 read with section 139 of N.I. Act. Accordingly, the case of the complainant is acceptable. The complainant has proved that, for discharge of liability accused has issued Ex.P2 cheque and he has intentionally not maintained sufficient amount in his account to honour the said SCCH - 26 16 CC No.12591/2022 cheque. Hence, this Point No.1 under consideration is answered in the Affirmative.
19. POINT No.2: In view of the reasons stated and discussed above, the complainant has proved the guilt of the accused punishable under section 138 of N.I. Act. Hon'ble Supreme Court of India in a decision reported in (2018)1 SCC-560 between Meters And Instruments (P) Ltd. v. Kanchan Mehta, it was held at para 18 that "The object of the provision being primarily compensatory, punitive element being mainly with the object of enforcing the compensatory element, compounding at the initial stage has to be encouraged but is not debarred at later stage subject to appropriate compensation as may be found acceptable to the parties or the court." Therefore, keeping in mind the time when the transaction has taken place and primary object of the provision, this court is of the opinion that, rather than imposing punitive sentence, if sentence of fine is imposed with a direction to compensate the complainant for its monitory loss, by awarding SCCH - 26 17 CC No.12591/2022 compensation U/Sec.357 of Cr.P.C, would meet the ends of justice. The amount covered under the disputed cheque is Rs.5,00,000/-. By considering EX.P-6 compromise decree in Com .O.S.No.319/2019, in para No.III that Directing the defendant to pay future interest at the rate of 24% per annum from the date of suit till realization", in this aspects, this court is of the opinion that, it is just and proper to imposed fine amount of Rs.6,55,000/-, out of which compensation of Rs.6,50,000/- has to be awarded to the complainant U/sec.357 Cr.P.C. Accordingly, this court proceeds to pass the following;
ORDER Acting under section 255 (2) of Criminal Procedure Code, accused is here by convicted for the offence punishable under section 138 of Negotiable Instrument Act and accused is sentenced to pay fine of Rs.6,55,000/-.
In default thereof accused shall undergo simple imprisonment for the term of 6 (Six) months.
SCCH - 26 18 CC No.12591/2022 Acting under section 357(1) (b) of code of criminal procedure, it is ordered that, Rs.6,50,000/- therefrom shall be paid to the complainant as a compensation, remaining fine amount is defrayed to the state for the expenses incurred in the prosecution.
Office is directed to supply free copy of judgment to the accused.
The bail bond shall stand cancelled .
(Dictated to the stenographer, directly over computer, typed by her, corrected by me and then pronounced in the open Court on this day 18 th April 2024) (Appasab Naik ) XXIV ADDL. SMALL CAUSES JUDGE & A.C.M.M. BENGALURU.
ANNEXURE I. WITNESSES EXAMINED ON BEHALF OF THE COMPLAINANT:
PW.1 : Sri. K.Anilkumar
II. DOCUMENTS MARKED ON BEHALF OF THE
COMPLAINANT:
Ex.P-1 : C/c of authorization letter
Ex.P-2 : Cheque
SCCH - 26 19 CC No.12591/2022
Ex.P-2(a) : Signature
Ex.P-3 : Bank endorsement
Ex.P-4 : C/c of compromise petition in
Commercial OS No.319/2019
Ex.P-5 : C/c of order sheets in Commercial
O S No 319/2019
Ex.P-6 : C/c of Award passed in Commercial
O S No 319/2019
Ex.P-7 : Legal Notice
Ex.P-8 : Postal receipt
Ex.P-9 : Acknowledgment receipt.
III. WITNESSES EXAMINED ON BEHALF OF THE ACCUSED :
--NIL--
IV. DOCUMENTS MARKED ON BEHALF OF THE ACCUSED:
-- NIL---
(Appasab Naik ) XXIV ADDL. SMALL CAUSES JUDGE & A.C.M.M. BENGALURU.