Bangalore District Court
Sri.E.Sheshadri vs Sri.Jagannath Hegde on 9 November, 2016
IN THE COURT OF THE XVI ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE, BENGALURU CITY
Dated: This the 9th day of November 2016
Present: Smt. Saraswathi.K.N, B.A.L., LL.M.,
XVI Addl.C.M.M., Bengaluru City.
JUDGEMENT U/S 355 OF Cr.P.C.,
Case No. : C.C. No.12116/2014
Complainant : Sri.E.Sheshadri,
S/o.E.K.Doria,
Aged about 72 yeas,
R/at.No.351, 37th Cross,
7th Main, 5th Block,
Jayanagar,
Bengaluru-41.
(Rep. by Sri.M.G.Sateesha.,
Adv.,)
- Vs -
Accused : Sri.Jagannath Hegde,
S/o.Harihara Hegde,
Having office at No.4,
3rd "A" Main,
Byrasandra,
Pattabiramanagara,
Bengaluru-11.
Also R/at.No.25,
Mudaliar Street,
Near Netkalappa Circle,
Basawangudi,
Bengaluru-4.
2 C.C. No.12116/2014 J
(Rep. by Sri.Harish Gowda.,
Adv.,)
Case instituted : 29.5.2013
Offence complained : U/s 138 of N.I. Act
of
Plea of Accused : Pleaded not guilty
Final Order : Accused is Convicted
Date of order : 9.11.2016
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, towards the discharge of his liability payable by the Accused to him in lieu of refund of amount which the Accused had obtained from him, the Accused issued the cheque bearing No.115794 for a sum of Rs.3,00,000/= drawn on the Shri Guru Ragavendra Sahakara Bank Niyamitha, Basavanagudi, Bengaluru, dated 12.3.2013. He has paid a sum of Rs.3,00,000/= to the Accused as hand loan and after receiving the said amount the Accused had promised to repay the said amount and 3 C.C. No.12116/2014 J issued post dated cheque for its repayment. At the time of issuing the said cheque the Accused assured him that the said cheques will be duly honoured on its presentation.
3. The Complainant has further submitted that believing the version of the Accused when he presented the cheque for encashment through his Banker, to its shock and surprise, the said cheque returned for the reason "Funds Insufficient" vide Bank endorsement dated 13.3.2013. Thereafter he approached the Accused to make payment, to which, the Accused gave an evasive reply and he also did not respond properly. The Accused has deliberately committed the illegal act and as such he is liable to pay an amount of Rs.3,00,000/=.
4. Thereafter he got issued a legal notice to the Accused through RPAD to his residential address as well as office address and they came to be returned as unclaimed and one notice as duly served. Inspite of it, the Accused has failed to repay the amount covered under the cheque.
5. The Complainant submits that, the dishonour of the cheque by the Accused has been malafide, intentional 4 C.C. No.12116/2014 J 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. The Pre-summoning evidence has been led by the Complainant on 12.5.2014. Prima-facie case has been made out against the Accused and he has been summoned vide order of the same date.
7. The Accused has appeared before the Court on 13.8.2014, he has been enlarged on bail, the substance of the accusation has been read over to him, he has pleaded not guilty and has claimed the trial.
8. In his post-summoning evidence, the Complainant has examined himself as P.W.1 and has filed his affidavit, wherein he has reiterated the averments made in the complaint.
P.W.1 has relied upon the following documentary evidence:-
Ex.P1 is the cheque, in which, the signature is identified by P.W.1 as that of the Accused as per Ex.P1(a), the Bank memo as per Ex.P2, the office copy of 5 C.C. No.12116/2014 J the legal notice as per Ex.P3, the postal receipts are as per Ex.P4 & 5, the postal acknowledgement as per Ex.P6, the returned postal cover as per Ex.P7, the complaint as per Ex.P8 and the signature of the Complainant on Ex.P8 as per Ex.P8(a).
9. The Statement of Accounts as per Ex.P9, the Relevant entries as per Ex.P9(a) & Ex.P9(b), the Statement of accounts as per Ex.P10 and the relevant entry as per Ex.P10(a) relating to the account of the Complainant have been marked through D.W.1.
10. The statement of the Accused under Sec.313 of Cr.P.C., has been recorded on 16.10.2015.
11. In Defence evidence, the Accused has examined himself on Oath under Sec.315 of Cr.P.C., as DW1.
In his evidence, DW1 has deposed that, he knows the Complainant since 4 to 5 yeas and that his friend by name Lokanatha had taken a building on rent from the Complainant for the p\urpose of running a BPO. The Complainant and he are having common friends by names Keshava and Narasimha and the said Keshava and Narasimha told him that they and the Complainant 6 C.C. No.12116/2014 J belong to the same community and that they are distant relatives. DW1 has further deposed that he was paying monthly rent to the office of his friend Lokananth to the Complainant by way of his cheques and that his friends by name Keshava and Narasimha were in need of funds and for the same reason, when they approached the Complainant, the latter lent loan to them.
12. D.W.1 has further deposed that, as he used to be out of station he had kept his 8 to 10 signed blank cheques in the office of his friend Lokanath for the purpose of payment of rent to the office and for other transactions. Though Keshava and Narsimha were not the registered partners, they were looking after their office and that when the said Keshava and Narsimha demanded loan from the Complainant, the latter had directed them to bring their two cheques and two cheques belonging to him. It is further deposed by D.W.1 that though the Complainant had lent loan to the Keshava and Narsimha, the said persons did not return the said loan to him and thereafter the Complainant wanted to register an apartment in his name, for the purpose of which, he asked him to lend him a loan of Rs.11,00,000/= and he undertook to repay the same 7 C.C. No.12116/2014 J within a week and asked him not to inform this fact to Keshava and Narasimha.
13. D.W.1 has further deposed that, later he lent Rs.11,00,000/= by way of cash to the Complainant in his house, in the presence of two witnesses and thereafter when the Complainant pressured the said Keshava and Narasimha to repay the loan availed by them from him, they failed to do so and thereafter when the Complainant had to repay the loan amount availed by him from him, he issued a cheque in his favour for a sum of Rs.4,00,000/= and thereafter another cheque for Rs.75,000/= and for the repayment of the balance amount, the Complainant told him that as Keshava and Narasimha had not repaid the loan availed by them from him, he would not pay the balance loan amount to him, which was due from him to him and also told him that his cheques were in his possession. It is further deposed by D.W.1 that the Complainant also told him that he had his 7 to 8 other cheques and that he would present all of them for encashment and thereby forced him to pay the amount which was due to him from Keshava and Narasimha. It is further deposed that the Complainant has also filed a case against the said Keshava, which is pending before the Court. According to the D.W.1 he has 8 C.C. No.12116/2014 J not issued any of his cheques to the Complainant and that it is the Complainant who has filled up the cheques and presented the same to the Bank and thereafter filed a false case against him.
14. D.W.1 has been cross-examined by the learned counsel for the Complainant, during which, he has admitted that the signatures at Ex.P1(a) and at Ex.P6 are his signatures and that he knows the Complainant since one year in 2013. He has further admitted that, during his occupation of the house of the Complainant on rent, there were financial transactions between them and according to him, he has not availed a loan of Rs.4,00,000/= from the Complainant in the year 2011 as alleged and likewise he has not availed any loan of Rs.1,00,000/= and Rs.4,00,000/= from him on 28.9.2011. It is further deposed by D.W.1 that though he has received the amount from the Complainant and issued the cheque in question to him towards the repayment of the said loan amount, he is deposing falsely with a view to escape from his liability. It is further admitted by D.W.1 that after the receipt of the legal notice, he has not lodged any police complaint against the Complainant.
9 C.C. No.12116/2014 J15. Final arguments were advanced at length by the learned counsels representing both the sides.
16. The learned counsel for the Complainant has prayed for the conviction of the Accused on the ground that, the Accused has not disputed and denied his signatures on the cheque at Ex.P1 as well as on the postal acknowledgment at Ex.P6 and it is also argued that the Accused has failed to prove that the cheque in question has been misused by his friends Keshava and Narasimha and he has also failed to examine either of them as witness/s so as to prove his defence theory. It is lastly argued that the presumption under Sec.118 & 139 of the N.I.Act are in favour of the Complainant and thereafter the Accused is liable to be convicted.
17. On the contrary, the learned defence counsel has prayed for the acquittal of the Accused on the ground that, the Complainant has admitted that the Accused was paying rent to him on behalf of his friend through cheques and that the Complainant has failed to prove the existence of the legally enforceable debt and he has also failed to prove that the cheque in question had been issued by the Accused towards the discharge of any legally enforceable debt. It is also argued that the 10 C.C. No.12116/2014 J Accused has proved by his reliable evidence and that the cheque in question which was kept by him in his office has been misused by Keshava and Narasimha, through whom the Complainant has misused his cheques and filed this false case against the Accused. Accordingly, prayed for the acquittal of the Accused.
18. I have considered the submissions and perused the record carefully.
19. 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. 11 C.C. No.12116/2014 J
20. 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.
21. 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:-
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".
22. 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;"12 C.C. No.12116/2014 J
23. 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.
24. 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.
25. 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.
26. The first defence raised by the Accused in this case is that, though the signature on the cheque at Ex.P1 as well as on the postal acknowledgment at Ex.P6 is not in dispute, it does not dispense with proving the existence of the legally enforceable debt on the part of the Complainant. According to the Accused, the Complainant has failed to prove the date and the amount and the purpose for which the alleged loan transaction has taken place. In this regard, it is pertinent to note that, even though the Complainant has not pleaded the purpose for which the Accused had allegedly availed loan from him, 13 C.C. No.12116/2014 J subsequently it is pleaded by him both in the complaint as well as in the legal notice that, he has paid a sum of Rs.4,00,000/= as hand loan to the Accused. In his cross- examination, the Complainant has deposed that the Accused was paying a monthly rent of Rs.3,000/= to his office space in his house, though the rental agreement was in the name of some other person and that he had paid 10 months rent as advance and he was on rent in his premises for about 1 and ½ years. Though there is no document produced by the Complainant to prove that he has a monthly income of Rs.75,000/=, during the evidence of the Accused, the Accused himself has deposed that the Complainant has paid to him a sum of Rs.4,00,000/= and Rs.75,000/= respectively in his favour by way of cheques. According to PW1 he has lent Rs.1,00,000/=, Rs.4,00,000/= and Rs.75,000/= by way of cheques and Rs.1,25,000/= by way of cash to the Accused and according to him, he has lent a total loan of Rs.7,00,000/= to the Accused and that towards the repayment of the same, the Accused has issued the cheque in question. Though initially the Complainant had not produced his Bank statements in order to prove such payments made by him to the Accused, subsequently in C.C.No.12116/14, the statement of 14 C.C. No.12116/2014 J accounts of the Complainant have been confronted to the Accused during his cross-examination and the same have been marked as Ex.P9 & 10 respectively. Though the said documents are not exhibited in the present case, the said documents go to show that the Accused has admitted having received a sum of Rs.1,00,000/= and Rs.4,00,000/= from the Complainant as per Ex.P9(a) & Ex.P9(b) in the said case respectively and Rs.5,40,000/= as per Ex.P10(a) in the said case respectively. Thereafter it is pertinent to note that in Ex.P9 there is an entry regarding another cheque bearing No.277279, by virtue of which Rs.75,000/= has been shown on 8.10.2011 in the name of his Brother. Though in his cross- examination, the Accused has admitted only the entries at Ex.P9(a) & Ex.P9(b), having not disputed the entry dated 8.10.2011, the said fact has remained unchallenged. Thereafter throughout the course of the cross-examination of the Complainant, the entire defence version suggested to him by the learned defence counsel about the alleged payment of Rs.11,00,000/= by the Accused to him for the purpose of the registration of a flat has been denied by PW1. Likewise PW1 has also denied the suggestion that he has issued a cheque for Rs.4,00,000/= and another cheque for Rs.75,000/= in 15 C.C. No.12116/2014 J favour of the Accused towards the repayment of rs.11,00,000/= which he had allegedly availed from the Accused and this defence has remained as a vague defence and the same has not been proved by the Accused. Moreover when the Accused has claimed that the actual transaction between him and the Complainant was for Rs.11,00,000/= and that too it was paid by him to the Complainant and not vice-versa as claimed by the Complainant, the onus is shifted on the Accused to prove the same. However except the oral testimony of the Accused about his alleged lending of Rs.11,00,000/= to the Complainant for the purpose of registration of a flat, there is no iota of evidence led by the Accused to substantiate the said defence theory. Even if this defence version of the Accused is believed to be true, then nothing prevented the Accused from examining his friend Keshava and Narasimha so as to corroborate his evidence before the Court. It is not the case of the Accused that the said two persons are neither alive nor not available before the Court. In such circumstance, an adverse inference is liable to be drawn against the Accused.
27. Further when the Accused has taken up a defence that, he used to keep his 8 to 10 signed blank cheques in the office of his friend Lokanath and for the 16 C.C. No.12116/2014 J purpose of payment of rent to the office and for other transactions and thereafter the said Keshava & Narasimha have issued his two cheques along with other cheques to the Complainant in respect of their loan transaction with the Complainant, it is for the Accused to substantiate the same at least by leading reliable evidence to believe the said version. But for the reasons best known to him, the Accused has not taken any steps even in this regard.
28. Further it is admitted by the Accused that, even after the receipt of the legal notice, he has not lodged any Police complaint against the Complainant. Admittedly the Accused is a Mechanical Engineer and being an educated person, it cannot be believed that, at least after he came to know that his two blank cheques were misused by his friends Keshava and Narasimha and the Complainant, nothing prevented him from taking appropriate legal action either against all of them or either of them, but he has failed in doing the same. Therefore it is highly impossible to believe that the Accused, being an educated person could have kept quite even after coming to know that the said Keshava, Narasimha and the Complainant have misused his cheques and got filed the present complaint against him, he would have kept quite, since 17 C.C. No.12116/2014 J normally no prudent man would ignore a situation in which without he having any liability, his signed blank cheque would be misused by some unauthorized persons. It is admitted by the Accused that, even after the receipt of the legal notice, he has not taken any action either against the Complainant or against Keshava and Narasimha. There are no special reasons for the Accused in not taking any such action against them, if really, his cheques had been misused by them.
29. Therefore when the Accused has admitted that the Complainant has paid a sum of Rs.4,00,000/= by way of cheque as well as Rs.75,000/= by way of cheque to him, but he claims that they were not towards the loan which were lent to him, but towards the repayment of the loan availed by the Complainant from him, the onus is shifted upon the Accused to prove the same. However the Accused has miserably failed in proving so and therefore the presumptions under Sec.139 and 118 are clearly available to the Complainant and on the other hand, the Accused has failed to rebut the said presumptions at least by probabalising his defence. Therefore this court is of the view that the Accused has failed to prove that the cheque in question has been misused by his friends 18 C.C. No.12116/2014 J Keshava and Narasimha and through them the Complainant has filed this present false case against him. In view of the reasons discussed above, I proceed to pass the following: -
ORDER By exercising the power conferred u/s 265 of Cr.P.C., the accused is hereby convicted for the offence punishable u/s 138 of the Negotiable Instruments Act.
He is sentenced to pay a fine of Rs.3,50,000/- (Rupees Three lakhs Fifty Thousand only) within 30 days from today and in default of payment of fine, he shall undergo simple imprisonment for 6 (six) months.
Out of the fine amount so collected Rs.3,40,000/-(Rupees Three Lakhs Forty Thousand Only) is ordered to be paid to the Complainant as Compensation and the balance of Rs.10,000/- (Rupees Ten Thousand only) is ordered to be adjusted towards cost to the State exchequer.
The bail bond and surety bond of the Accused stands cancelled.
Issue free copy of Judgment to the Accused forthwith.
(Dictated to the Stenographer, transcript thereof is computerized and print out taken by her, verified, corrected and then pronounced by me in the open Court on this the 9th day of November 2016).19 C.C. No.12116/2014 J
(SARASWATHI.K.N), XVI Addl.CMM., Bengaluru City. ANNEXURE
1. List of witnesses examined on behalf of the Complainant:
PW.1 : E.Sheshadri
2. List of documents exhibited on behalf of the Complainant:
Ex.P-1 : Original Cheque;
Ex.P-1(a) : Signature of the Accused;
Ex.P-2 : Bank memo;
Ex.P-3 : Copy of the Legal Notice;
Ex.P-4 & 5 : Postal receipts;
Ex.P-6 : Postal acknowledgement;
Ex.P-7 : Postal cover;
Ex.P-8 : Complaint;
Ex.P-8(a) : Signature of the Complainant on Ex.P8;
Ex.P-9 : Statement of accounts;
Ex.P-9(a) & : Relevant entries;
9(b)
Ex.P-10 : Statement of accounts;
Ex.P-10(a) : Relevant entry.
(Marked through D.W.1)
3. List of witnesses examined on behalf of the Accused:
DW-1 : Jagannatha Hegde 20 C.C. No.12116/2014 J
4. List of documents exhibited on behalf of the Accused:
- Nil -
(SARASWATHI.K.N), XVI ACMM, Bengaluru City.21 C.C. No.12116/2014 J
9.11.2016 Judgment pronounced in the open court vide separate order.
ORDER By exercising the power conferred u/s 265 of Cr.P.C., the accused is hereby convicted for the offence punishable u/s 138 of the Negotiable Instruments Act.
He is sentenced to pay a fine of Rs.3,50,000/- (Rupees Three lakhs Fifty Thousand only) within 30 days from today and in default of payment of fine, he shall undergo simple imprisonment for 6 (six) months.
Out of the fine amount so collected Rs.3,40,000/-(Rupees Three Lakhs Forty Thousand Only) is ordered to be paid to the Complainant as Compensation and the balance of Rs.10,000/- (Rupees Ten Thousand only) is ordered to be adjusted towards cost to the State exchequer..
The bail bond and surety bond of the Accused stands cancelled.
Issue free copy of Judgment to the Accused forthwith.
22 C.C. No.12116/2014 J(SARASWATHI.K.N), XVI Addl.,Chief Metropolitan Magistrate, Bengaluru City.