Bangalore District Court
Is A Company Incorporated Under vs Accused Examined Himself As Dw1 But Not on 30 November, 2018
IN THE COURT OF THE XLII ADDL. CHIEF
METROPOLITON MAGISTRATE NRUPATHUNGA
ROAD, BENGALURU CITY
Present:- Sri. ABDUL RAHIM HUSSAIN SHAIKH
B.Sc, B.Ed, LLB(Spl)
XLII A.C.M.M
Bengaluru City.
Dated this the 30th day of November, 2018
CC.No.14159/2016
JUDGMENT U/S 355 OF Cr.P.C.
1. Sl.No. of the case : C.C.No.14159/2016
2. The date of commence of Evidence: 24.10.2017
3. The date of Institution : 22.04.2016
4. Name of the Complainant :M/s Kapil Chits (K)
Pvt Ltd
Having its registered
office at
No.499, East End Road,
Jayanagar, 9th block,
Bangalore - 560 068.
Branch Bellary,
Represented by its
Legal Officer,
Sri. T. Prasad
S/o T. Govindappa
5. Name of the Accused : Mr. Thimmanna B
S/o Balappa,
R/at No.88/3,
Near Panchayath Office,
2 CC.No.14159/2016
Basavanapura,
Anekal Tq,
Bengaluru- 83.
6. The offence complained : U/s.138 of N.I. Act
7. Plea of the accused on
his examination : Pleaded not guilty
8. Final Order : Accused is Convicted
9. Date of such order : 30.11.2018
JUDGMENT
1. This case has been registered against the accused on the basis of the complaint filed by the complainant u/s 200 of Cr.P.C for the offence punishable u/s 138 r/w 142 of N.I. Act.
2. The gist of the complainant's case is that :
Complainant is a Company incorporated under the Company's Act 1956 and they are in the business of promoting and conducting chits as per the provisions of the Chit Funds Act. Accused was the subscriber for a chit bearing No.BLJ05G with the Ticket No.06 for a chit value of Rs.2,00,000/- payable at Rs.5,000/- for a period of 40 months at Jayanagara 3 CC.No.14159/2016 Branch. The accused became the successful bidder in auction held on 27.12.2012 for a bid value of Rs.60,000/- and the accused has received the prize amount of Rs.1,40,000/- on 20.03.2013 after furnished the requisite surety. After obtaining the chit prized money the accused has failed to pay the monthly chit installments and the account has become over due and complainant has demanded the accused to pay chit installments amounting to Rs.1,43,000/-, the accused has issued the cheque bearing No.644016 dated:20.02.2016 for Rs.1,43,000/- drawn on State Bank of Mysore, Hulimavu branch, Bengaluru in favour of the complainant to clear the balance amount. The said cheque was presented for encashment with his banker Union Bank of India, 4th block, Jayanagar, Bengaluru but the said cheque was dishonour for the reasons 'Insufficient Funds'. To that effect received the banker memo dated 23.02.2016. There after on 14.03.2016 complainant got issued a legal notice to 4 CC.No.14159/2016 the accused by RPAD calling upon the accused to pay the cheque amount within 15 days from the date of receipt of the said notice. The said notice was returned with postal endorsement 'Insufficient Address' on 17.03.2016. Even after lapse of 15 days from the date of receipt of the notice the accused fails to pay the cheque amount. Inspite of receipt of notice the accused has not paid the cheque amount to the complainant nor issued any reply. The complainant filed the complaint against the accused for having committed an offence punishable u/s 138 of N.I. Act on 22.04.2016
3. In pursuance of the summons, the accused has appeared through Counsel and got enlarged on bail by executing necessary documents. The copy of the complaint was furnished to the accused, as required under law. As there was sufficient material, plea was recorded against the accused on 11.08.2017 and explained to the accused in his vernacular, for which 5 CC.No.14159/2016 the accused pleaded not guilty and claims to be tried.
4. In order to prove the case, the Legal officer of the complainant Company examined as PW1 and got marked Ex.P1 to 14. Then the statement u/s 313 Cr.P.C was recorded on 28.11.2017, wherein the incriminating evidence appeared against the accused was read over and explained which was denied by the accused. Accused examined himself as DW1 but not got marked any documents on his behalf.
5. The learned Counsel for complainant argued that accused was the subscriber for a chit bearing No.BLJ05G with the Ticket No.06 for a chit value of Rs.2,00,000/- payable at Rs.5,000/- for a period of 40 months at Jayanagara Branch. The accused became the successful bidder in auction held on 27.12.2012 for a bid value of Rs.60,000/- and the accused has received the prize amount of Rs.1,40,000/- on 20.03.2013 after furnished the requisite surety. After obtaining the chit prized money the accused has failed 6 CC.No.14159/2016 to pay the monthly chit installments and the account has become over due and complainant has demanded the accused to pay chit installments amounting to Rs.1,43,000/-, the accused has issued the cheque bearing No.644016 dated:20.02.2016 for Rs.1,43,000/- drawn on State Bank of Mysore, Hulimavu branch, Bengaluru in favour of the complainant to clear the balance amount. The said cheque was presented for encashment with his banker Union Bank of India, 4th block, Jayanagar, Bengaluru but the said cheque was dishonour for the reasons 'Insufficient Funds'. To that effect received the banker memo dated 23.02.2016. There after on 14.03.2016 complainant got issued a legal notice to the accused by RPAD calling upon the accused to pay the cheque amount within 15 days from the date of receipt of the said notice. The said notice was returned with postal endorsement 'Insufficient Address' on 17.03.2016. Even after lapse of 15 days from the date of receipt of 7 CC.No.14159/2016 the notice the accused fails to pay the cheque amount. Inspite of receipt of notice the accused has not paid the cheque amount to the complainant nor issued any reply. The complainant filed the complaint against the accused for having committed an offence punishable u/s 138 of N.I. Act on 22.04.2016. Further it is contended that the presumption was in favour of the complainant which was not rebutted by the accused. It is contended by the complainant that the ingredients of Sec.138 and 142 are duly complied with and the accused is entitled for conviction.
6. The learned counsel for complainant in support of his contention he placed reliance on the following citations:
1.2005 Crl.LJ 4297 (Andhra Pradesh High Court) (Polisetty Seetharamanjaneyulu and others v/s Public Prosecutor, High Court of A.P Hyderabad) 2 (2006) 6 SCC 456 (D. Vinod Shivappa v/s Nanda Belliappa) 8 CC.No.14159/2016
7. The learned Counsel for accused submitted that he is not the subscriber for the Chit bearing No.BJL.05G with ticket No.06. It is also the contention of the accused that he has not issued the alleged cheque to the complainant for the repayment of chit amount but the complainant company have misused the cheque which he had handed over to Kumar for financial transaction and filed false complaint against the accused. Hence, the learned Counsel for accused prayed to acquit the accused. In order to prove his defence complainant placed reliance on the following citations:
1.(2006) 6 Supreme Court cases 39 (M. S Narayana Menon Alias Mani v/s State of Kerala and another) 2.2009 (1) DCR 690 Bombay High Court (Chicho Ursula D'souza v/s Goa Plast Pvt Ltd) 3.2015 I Supreme Court cases 99 ( K Subramani v/s Damodara Naidu)
4.LR 2009 KAR 172 (Sri A Viswanatha Pai v/s Sri. Vivekananda S. Bhat)
5. LAWS (Bom) 2008 6 61 High Court of Bombay at Panaji (Chico Ursula De Souza v/s Goa Plast Pvt Ltd 9 CC.No.14159/2016
8. Heard arguments and perused the material placed on record.
9. On the basis of the above facts, the following points arise for my consideration:
1.Whether the complainant proves that the accused towards discharge of legal recoverable debt issued cheque bearing No.644016 dated 20.02.2016 for an amount of Rs.1,43,000/- drawn on State Bank of Mysore, Hulimavu branch, Bengaluru in favour of complainant, on presentation for encashment it was returned as 'Funds Insufficient' and in spite of receipt of legal notice, the accused failed to pay the cheque amount within the statutory period and thereby the accused has committed an offence punishable u/s 138 of N.I. Act?
2. What order?
10. My findings on the above points are as under:
Point No.1: In the Affirmative Point No.2: As per final order, for the 10 CC.No.14159/2016 following:
REASONS
11. Point No.1:- In order to prove the case, the Legal Officer of the complainant Company Sri. T. Prasad filed affidavit by way of examination-in-chief and has reiterated the allegations made in the complaint on oath. In the evidence PW1 produced the documents which were marked Ex.P1 to P13. On perusal of document Ex.P1 it is found that it is the minutes of the meeting of the Board of Directors held on 15.12.2009 wherein it was resolved to authorize PW1 Mr. T. Prasad to file suits, execution and complaints to contest the cases on behalf of their company. Further PW1 was also produced Ex.P14 the authorization by the Managing Director to contest the case on behalf of the company pertaining to the chit funds scheme of the company. It is very pertinent to note that in the cross examination of PW1 it is the contention taken by the defence advocate is that Ex.P14 has been 11 CC.No.14159/2016 fabricated and produced by the complainant which is denied by PW1. It is also suggested in the cross examination of PW1 that in Ex.P1 the specific case against the accused is not mentioned, hence PW1 has no right to file the complaint against the accused. In support of his contention accused has also relied on the ruling :
2009 (1) DCR 690 Bombay High Court Decided on 25.06.2008 (Chicho Ursula D'Soza v/s Goa Plast Pvt Ltd) and contended that the Director alone cannot be give a power of attorney unless there was a resolution in his favour passed by the company at its meeting of Board of Directors. Per contra, it is vehemently argued by the complainant counsel that the board of director meeting was held on 15.12.2009 as per Ex.P1 hence PW1 is authorized by the board of directors and accordingly as per Ex.P14 he is duly authorize to contest the case. On perusal of Ex.P1 it is found that it is the minutes of 12 CC.No.14159/2016 the 49th Meeting the board of directors held on 15.12.2009 resolving to authorize PW1 to contest the case and Ex.P14 is authorization issued by the Managing Director in terms of the board resolution dated 15.12.2009 to contest the cases on behalf of the complainant company including the chit funds scheme. The documents Ex.P1 and P14 is crystal clear that as in view of board of meeting of the directors and as per the resolutions passed in a meeting PW1 is authorized to contest the case on behalf of the company including the chit fund scheme.
It is pertinent to note that in the evidence of DW1 he has not produced any documents to show that no board of directors meeting of the complainant company as per Ex.P1 was commenced and the authorization Ex.P14 produced by the complainant is a fabricated document. In view of the same it is held that the ruling produced by the accused that complainant is not duly authorized is not applicable to the present 13 CC.No.14159/2016 facts and circumstances of the case. From the above reasons and discussions it is found that PW1 the complainant is duly authorized to represent the company and contest this case against the accused.
12. It is the evidence of PW1 deposed that accused being the subscriber for the chit bearing No.BLJ05G with the Ticket No.06 for a chit value of Rs.2,00,000/- payable at Rs.5,000/- for a period of 40 months was successful bidder in auction held on 27.12.2012 for a bid value of Rs.60,000/- and received the prize amount of Rs.1,40,000/- on 20.03.2013 after furnished the requisite surety. To prove the said fact complainant has produced Ex.P5 the chit agreement executed by the accused and also produced Ex.P8 prize amount payment voucher, Ex.P9 the surety forms, Ex.P11 On demand promissory note executed by the accused and the surety, Ex.P11 the guarantors agreement, Ex.P12 the permission letter to start the chit group and a certificate Ex.P13 for commencing of 14 CC.No.14159/2016 the chit. On perusal of all these documents it is found that complainant has taken the permission to start the chit group BJL05G and as per Ex.P13 the group has been commenced on 30.08.2012. It is important to note that there is no dispute regarding the commencement of the chit group by the accused but the only contention is that he was not the subscriber of the chit nor the bidder for prize money in the said group. On perusal of Ex.P5 it is found it is the agreement of chit between accused and the complainant for chit amount of Rs.2,00,000/-. Further Ex.P8 shows that it is the prized amount payment voucher made to the accused through cheque which has been denied by the accused. On perusal of Ex.P9 it is found that it is a surety form containing the details of the sureties for the accused to the said chit and Ex.P11 discloses that On Demand Promissory note had been executed by the accused along with the surety holders.
15 CC.No.14159/2016
13. It is pertinent to note that accused had denied that he has never entered into chit transaction with the complainant and the said documents have been concocted and have been produced before the court to extract money from the accused. It is the case of the accused that he had obtained a loan of Rs.30,000/- from one Kumar working in Canara Bank, Jayanagar for advancing the same towards the rent of the house. It is further contention of the accused that he had issued 3 blank cheques to said Kumar and paid him Rs.10,000/- and one of the said cheque Ex.P2 in this case has been misused by the complainant to lodge the complaint against this accused. In the evidence of DW1 he deposed as follows:-
1" £À£ÀUÉ dAiÀÄ£ÀUÀgÀzÀ PÉ£ÀgÁ ¨ÁåAPï£À°è PÉ®¸À ªÀiÁqÀÄwÛgÀĪÀ PÀĪÀiÁgï J£ÀÄߪÀªÀ£À ¥ÀjZÀAiÀÄ EzÀÄÝ £Á£ÀÄ DvÀ£À §½ gÀÆ.30,000 ºÀtªÀ£ÀÄß ªÀÄ£É ¨ÁrUÉUÉ ªÀÄÄAUÀqÀ ºÀt PÉÆqÀĪÀ ¸À®ÄªÁV ¸Á® ¥ÀqÉ¢zÉÝ. D ¸ÀªÀÄAiÀÄzÀ°è ¸ÀzÀj PÀĪÀiÁgï £À¤ßAzÀ ªÀÄÆgÀÄ SÁ° 16 CC.No.14159/2016 ZÉPÀÄÌUÀ¼À£ÀÄß ¥ÀqÉzÀÄPÉÆArzÀÝ£ÀÄ. PÀĪÀiÁgÀ¤UÉ £Á£ÀÄ gÀÆ.10,000 ºÀtªÀ£ÀÄß ¥ÁªÀw¹zÉÝãÉ.
PÀĪÀiÁgÀ¤UÉ £Á£ÀÄ ªÀÄÆgÀÄ SÁ° ZÉPÀÄÌUÀ¼À£ÀÄß PÉÆnÖzÀÄÝ F ¥ÀæPÀgÀtzÀ°ègÀĪÀ ¤¦-2 ZÉPÀÄÌ ¸ÀzÀj ZÉPÀÄÌUÀ¼À°è MAzÁVgÀ§ºÀÄzÀÄ. ¥Àæ²ßvÀ ZÉPÄÀ Ì ¦gÁå¢ §½UÉ ºÉÃUÉ vÀ®Ä¦vÀÄ JAzÀgÉ ¸ÁQëAiÀÄÄ PÀĪÀiÁgÀ£Éà £Á£ÀÄ ¤ÃrzÀÝ ZÉPÀÌ£ÀÄß ¦gÁå¢ ¸ÀA¸ÉÜUÉ ¤ÃrgÀ§ºÀÄzÀÄ JAzÀÄ £ÀÄrAiÀÄÄvÁÛgÉ. ¦gÁå¢ ¸ÀA¸ÉÜAiÀÄ°è £Á£ÀÄ AiÀiÁªÀÅzÉà ªÀåªÀºÁgÀ ªÀiÁr®è. ¸ÀzÀj ZÉPÀÌ£ÀÄß zÀÄgÀÄ¥ÀAiÉÆÃUÀ ªÀiÁrPÉÆAqÀÄ £À£Àß «gÀÄzÀÝ ¸ÀļÀÄî zÀÆgÀÄ zÁR°¸À¯ÁVzÉ."
From this evidence of DW1 it is crystal clear that as per accused he had no relation with the complainant company nor with the alleged chit transaction. Further it is also important to note that in the cross examination of PW1 the counsel for accused suggested PW1 that accused had issued the cheque to one Murthy and from him the complainant has received the disputed cheque and has filed false compliant against the accused which is denied by the PW1. The 17 CC.No.14159/2016 relevant portion of cross examination of PW1 at page-5 regarding the said fact is as follows:-
"aÃn ¸ÀzÀ¸ÀågÁUÀĪÀÅzÀPÉÌ ¦gÁå¢ PÀA¥À¤AiÀĪÀgÀÄ ¸ÁªÀðd¤PÀjUÉ DºÁé£À ¤ÃqÀÄvÁÛgÉ. DgÉÆæ ¦gÁå¢AiÀÄ ©.Dgï ªÀÄÆwð J£ÀÄߪÀ KeÉAmï ªÀÄÆ®PÀ ¥Àæ²ßvÀ aÃnAiÀÄ ¸ÀzÀ¸ÀågÁVgÀÄvÁÛgÉ. ¸ÀzÀj KeÉAmïgÀªÀgÀÄ ¨ÉAUÀ¼ÀÆj£À §£ÉßÃgÀÄ¥ÀslÖ gÀ¸ÉÛAiÀÄ°ègÄÀ ªÀ CgÀPÉgÉ ¤ªÁ¹AiÀiÁVgÀÄvÁÛgÉ."
Further at page-5 and 6 it is suggested in the cross examination of PW1 there was a financial dealing by accused with one Murthy and from the said Murthy the complainant had received the documents in filing a false complaint against the accused.
14. From this evidence of DW1 in chief examination and the suggestion made in the cross examination of PW1 by the counsel of the accused it is found that the accused and his counsel is in total confusion whether the transaction of the accused was with Murthy or Kumar. The evidence of DW1 is that accused had a 18 CC.No.14159/2016 financial transaction with Kumar and had issued a cheque to Kumar which have been misused by the complainant lodging this false complaint. Further the cross examination of PW1 by the accused counsel comes out with another story that accused had a financial relation with the agent of the company Murthy and from him the complainant company has obtained the documents in lodging a false complaint against the accused. This confusion created by the accused in his evidence has to be proved by the accused beyond all reasonable doubt as to whether his version in his evidence that he had financial transaction with Kumar has to be believed or the suggestion made by the counsel that accused had a financial contact with the agent of the company by name Murthy from whom the complainant company has obtained the document in filing this complaint against the accused. It is also important to note that in the cross examination PW1 it is suggested by the 19 CC.No.14159/2016 accused counsel that the complainant had obtained the disputed cheque and the document from one Murthy with whom the accused had financial affairs and misuse the same in filing the false case against the accused. The suggestion made in the cross examination of PW1 and the evidence of PW1 regarding the said fact is as follows :
" ªÀÄÆwð J£ÀÄߪÀªÀgÀ eÉÆvÉ DgÉÆæ ºÀtPÁ¸ÀÄ ªÀåªÀºÁgÀ ºÉÆA¢zÀÄÝ, DvÀ¤AzÀ zÁR¯É ¥Àqz É ÀÄPÉÄÁAqÀÄ DgÉÆæ «gÀÄzÀÝ ¸ÀļÀÄî ¸ÁQë £ÀÄrAiÀÄÄwÛzÉÝÃ£É JAzÀgÉ ¸ÀjAiÀÄ®è."
The suggestion made in the cross examination of PW1 by the accused counsel that the complainant has obtained the documents from one Murthy with whom accused had financial affairs and misuse the same in filing this complaint has been totally denied by the complainant. From this suggestion by accused counsel it is found that according to the counsel for accused the complainant had obtained the documents 20 CC.No.14159/2016 i.e., a disputed cheque from one Murthy quiet contrary to the said suggestion the evidence of accused is that he had obtained loan from Kumar and had handed over the cheques to Kumar from whom the complainant company has obtained the disputed cheque in filing this case against him. Further it is very important to note that in the cross examination of the accused /DW1 he admitted that he had never issued any notice to Kumar to return his cheques nor he has taken any legal action against the Kumar for having handed over the cheques to the complainant who has filed false complaint against him. Further also accused admitted in his cross examination that he has never intimated the bank officials to make stop payment for the cheques which he had issued to said Kumar. The relevant portion of evidence of DW1 regarding the said fact in the cross examination at page-4 is as follows:
" PÀĪÀiÁgï J£ÀÄߪÀªÀ¤UÉ £Á£ÀÄ ¤ÃrzÀÝ ZÉPÀÄÌUÀ¼À£ÀÄß 21 CC.No.14159/2016 ªÀÄgÀ½¸ÀĪÀAvÉ AiÀiÁªÀÅzÉà ¥ÀvÀæ ªÀåªÀºÁgÀ ªÀiÁr®è. £À£ÀUÉ ¦gÁ墬ÄAzÀ £ÉÆÃn¸ï §AzÀ £ÀAvÀgÀ £Á£ÀÄ PÉÆnÖzÀÝ ZÉPÀÄÌUÀ¼À£ÀÄß PÀĪÀiÁgï J£ÀÄߪÀªÀ£ÀÄ zÀħð¼ÀPÉ ªÀiÁr ZÉPÀÌ£ÀÄß ¦gÁå¢ ªÀ±ÀPÉÌ PÉÆlÖ §UÉÎ DvÀ£À «gÀÄzÀÝ ¥Éǰøï oÁuÉAiÀįÁèUÀ°Ã CxÀªÁ £ÁåAiÀiÁ®AiÀÄzÀ¯ÁèUÀ°Ã AiÀiÁªÀÅzÉà zÀÆgÀ£ÀÄß ¸À°è¹®è .
PÀĪÀiÁgÀ¤UÉ £Á£ÀÄ ¤ÃrzÀÝ ZÉPÀÄÌUÀ¼ÀÄ ¨ÁåAQUÉ £ÀUÀ¢ÃPÀgÀtPÉÌ §AzÀ°è CªÀ£ÀÄß vÀqÉ»rAiÀĨÉÃPÀÄ JAzÀÄ £À£Àß ¨ÁåAQUÉ AiÀiÁªÀÅzÉà ªÀiÁ»w ¤Ãr®è."
It is pertinent to note that as an ordinary prudent man if accused had issued the cheque to Kumar definitely he would have given the notice to Kumar to return his cheque after payment of money to said Kumar. Further an ordinary prudent man after his knowledge that he had issued to Kumar has been misused by Kumar by colluding with the complainant company in lodging the false compliant definitely would have taken legal action against Kumar and had lodged a complaint against him. In this case even after the receipt of the summons in this case and after knowledge that the 22 CC.No.14159/2016 cheque which he had given to Kumar had been misuse by Kumar definitely accused would have filed a case of cheating against the Kumar. But in this case the said facts have not forthcoming as per the admission of DW1 in the cross examination. In view of the same the evidence of DW1 that he had financial transaction with the Kumar and had obtained a loan of Rs.30,000/- for paying advance as a rent and at the time issued 3 blank cheques to Kumar and the said cheques were misused by the complainant company after obtained the same from Kumar and lodging this false complaint against the accused cannot be believed and cannot be considered.
15. In the cross examination accused admitted that he put a signature in English language and denied his own signature on the vakalath filed by his counsel on 11.08.2017 and the said vakalath is marked as ExC1 and accused signature is marked as Ex.1C. Further in the cross examination DW1 denied his another 23 CC.No.14159/2016 signature on vakalath dated :22.02.2017 is marked as Ex.C2 and the signature marked as Ex.C2(a). Further the accused denied his signature even on the 313 statement dated:28.11.2017 and also denied his signature on the chit agreement Ex.P5 the said denied signature is marked as Ex.P5(a). It is very pertinent to note that the conduct of the accused can be looked into since he has made up his mind to deny his signatures inspite of having knowledge regarding the same. It is pertinent to note that accused not only denied his signature on his vakalath filed before the court but went to the extent denying his own signature sign before the court at the time of 313 statement. this conduct of the accused is crystal clear that he has no respect towards the legal proceedings and also he is not trust worthy when he denies his own signature on vakalath and 313 statement before the court. It is important to note that the contention of the accused that he has not signed on the chit agreement Ex.P5 24 CC.No.14159/2016 with signature Ex.P5(a) cannot be considered at all. The signature on the agreement at Ex.P5(a) when compared with the signatures on vakalath Ex.P1(a) Ex.P2(a) and the 313 statement appears to be identical and similar. In view of the same the evidence of DW1 that he was not a chit subscriber in the complainant company and he has not entered into chit agreement as per Ex.P5 with the complainant company cannot be taken into consideration. The documents chit agreement Ex.P5 clearly discloses that accused are the subscriber of the chit and he has entered into a chit agreement by endorsing his signature Ex.P5(a) on the said document.
16. It is further evidence of PW1 that after obtaining the chit prized money the accused has failed to pay the monthly chit installments and on demand to pay chit installments amounting to Rs.1,43,000/-, the accused has issued the cheque bearing No.644016 dated:20.02.2016 for Rs.1,43,000/- drawn on State 25 CC.No.14159/2016 Bank of Mysore, Hulimavu branch, Bengaluru in favour of the complainant. It is also the evidence of PW1 that The said cheque was presented for encashment with his banker Union Bank of India, 4th block, Jayanagar, Bengaluru but the said cheque was dishonour for the reasons 'Insufficient Funds'. To that effect received the banker memo dated 23.02.2016. There after on 14.03.2016 complainant got issued a legal notice to the accused by RPAD calling upon the accused to pay the cheque amount within 15 days from the date of receipt of the said notice. The said notice was returned with postal endorsement 'Insufficient Address' on 17.03.2016. Even after lapse of 15 days from the date of receipt of the notice the accused fails to pay the cheque amount. Inspite of receipt of notice the accused has not paid the cheque amount to the complainant nor issued any reply. In order to prove the said fact PW1 has produced Ex.P8 the payment of prize money, voucher and also 26 CC.No.14159/2016 produces ExP9 surety forms and Ex.P11 the On Demand Promissory note executed by the accused for repayment of the chit amount. The document Ex.P8 discloses that the amount prize money has been dispersed to the accused by cheque payment. Further PW1 has also produced Ex.P6 the ledger account pertaining to the chit transaction BJL05G -6 standing in the name of the accused for the period of 01.01.2006 to 23.08.2018. The said transactions discloses that accused had received Rs.1,40,000/- prize money through cheques and he is in due for payment of Rs.1,43,000/- to the complainant company. It is pertinent to note that accused has denied the entire transaction with the complainant company and also the outstanding due to be paid by him on the date of issuing of the cheque. To substantiate his defense accused had not produced cogent evidence and relevant document nor he has examined Kumar for whom he contended to have 27 CC.No.14159/2016 issued the disputed cheque. In the absence of cogent evidence and relevant document the defence of accused that the disputed cheque which he had issued to Kumar has been misused by the complainant company cannot be taken into consideration. It is pertinent to note that accused never denied that the cheque Ex.P2 and signature on the said cheque Ex.P2(a). But only contended that the said cheque was issued by him to Kumar for the loan obtained from him and the said cheque has been misused by the complainant company. It is found that accused has discharged his onus and had rebutted the presumption available to the complainant in terms of Sec.138 & 139 of the N.I Act when he accepts the cheque Ex.P2 has the cheque to his account and admits his signature Ex.P2(a) on the said cheque.
17. At this juncture I would also like to discuss the dictum of law laid down in 2010 (11) SCC 441 (Rangappa v/s Sri. Mohan) 28 CC.No.14159/2016 The Hon'ble Supreme Court has laid down the dictum of law and has held in para-16 that :
" Once the cheque relates to the account of the accused that he accepts and admits the signature on the said cheque, then initial presumption as contemplated under section 139 of the Negotiable Instrument Act has to be raised by the court in favour of the complainant. The presumption referred to in section 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 ....."
In the light of the principle laid down in the above case, it is crystal clear that when accused admits his signature on the disputed cheque mandatory presumption u/s 139 of N.I Act arise in favour of the complainant which has to be rebutted by the accused. In the instant case accused has failed to rebut the presumption which has been raised u/s 139 of N.I Act 29 CC.No.14159/2016 in favour of the complainant.
18. I would like to refer on the decision of the AIR 2018 Hon'ble Supreme Court 3601 (T.P Murugan (Dead) Thr.Lrs.V Bojan AND Posa Nandhi Rep.Thr, POA Holder, T.P Murugan v. Bojan) In this ruling at para-8 the Hon'ble Supreme Court has laid down the dictum of law that u/s 139 of the N.I Act, once a cheque has been signed and issued in favour of the holder, there is statutory presumption that it is issued in discharge of a legally enforceable debt or liability by referring to K.N.Beena v/s Muniyappan and Another, (2001) 8 SCC 458, para-6 and Rangappa v/s Shrimohan (2010) 11 SCC 411, para 26 . It is further held that the presumption is a rebuttable one, if the issuer of the cheque is able to discharge the burden that it was issued for some other purpose like security for a loan.
19. In the present case the accused has failed to produce any credible evidence to rebut the statutory 30 CC.No.14159/2016 presumption in the light of discussion made above. The complainant has proved the case by overwhelming evidence to establish that the cheque/Ex.P2 was issued by the accused towards discharge of an existing liability and legally enforceable debt.
20. Accused has produced a ruling reported in:
(2006) 6 Supreme Court cases 39 (M. S Narayana Menon Alias Mani v/s State of Kerala and another) Perused the said ruling in which the Hon'ble Supreme Court has laid down the dictum of law that initial burden of proof is on accused to rebut the said presumption by raising a probable defence. If he discharges the said burden the onus there after shifts on to the complainant to prove his case.
This ruling is not applicable to the present facts and circumstances of the case since as per the discussions made above accused has utterly failed to prove his defence and rebut the presumption exists in favour of the complainant. Further in the said ruling it is also 31 CC.No.14159/2016 held that an adverse inference has to be drawn against the party for non production of statutory books of account in relation to the transaction. In this case accused has produced Ex.P6 the ledger extract of the chit subscribed by the accused from 01.01.2006 to 23.08.2017 which discloses the transaction of the accused with the complainant company and also existing of due payment to be made by the accused.
21. Accused has also produced a ruling reported in:
2015 I Supreme Court cases 99 ( K Subramani v/s Damodara Naidu) Perused the same and found that the Hon'ble Supreme Court has laid down the dictum of law that if the complainant could not prove the source of income from which alleged loan was made to the appellant accused presumption is in favour of the holder of the cheque stands rebutted. This ruling is not applicable to the present facts and circumstances of the case since there is no defence 32 CC.No.14159/2016 that the complainant had no capacity or income to pay the loan to the accused. The complainant company is admittedly is in a business of promoting and conducting chits as per the provisions of the chit fund Act 1982 and as per Ex.P12 a license has been issued to the company for conducting the chit and accordingly as per Ex.P13 the chit group BJL05G has been registered and reported to the Chit Registrar regarding commencement of the said group hence, the question of no capacity or income for the complainant to lend the loan does not arise.
22. Further accused has also produced the ruling reported in:
LR 2009 KAR 172 (Sri A Viswanatha Pai v/s Sri. Vivekananda S. Bhat) In this ruling the Hon'ble High Court held at para-9 that by referring various early decisions and also the decisions of other High Courts the Hon'ble Supreme Courts have observed in AIR 2008 SC 1325=2008 33 CC.No.14159/2016 (4) SCC 54 Krishna Janardhan Bhat v/s Dattathreya G Hegde that complainant has to prove the existence of legally recoverable debt payable to him by the accused as on the date of issuing of the cheque by accused and that in order to rebut the presumption to be drawn in favour of the complainant the accused need to examined himself and he may discharge his burden on the basis of the materials already brought on record. In the instant case the accused has examined himself but have utterly failed to discharge his burden by producing cogent evidence and relevant document. In view of the same this ruling is not supporting the defence of the accused and not applicable for the case of the accused.
23. Further I would like to discuss the dictum of law laid down by Hon'ble High Court when the signature of the accused is not denied and the same is proved by the complainant.
Delhi District Court (Sh.Prem Chand v/s 34 CC.No.14159/2016 Unknown on 19 October, 2016 Para-21 it is held that :
"Admission of signatures is sufficient to prove that the cheque in question must have been issued in discharge of some legal liability/debt. In Jaipal Singh Rana v. Swaraj Pal 149 (2008) DLT 682, the Hon'ble Delhi High Court has held that there is no alteration in a cheque if the amount and the date are filled by somebody else apart from the signatory of the cheque. It was further held that there is no law that requires the filling up of entire cheque by drawer himself".
In the cross examination of PW1 it is suggested by the accused counsel that there is difference in the writing in Ex.P2 regarding the entry of amount made in words and the signature Ex.P2(a) of the accused which is denied by PW1. The relevant evidence is as 35 CC.No.14159/2016 follows:
" ¤¦.2 gÀ°è PÁtô¸À¯ÁzÀ ªÉÆvÀÛ §gÉzÀ §gÀºÀPÉÌ ªÀÄvÀÄÛ ¤¦.2 (J) ¸À»UÀÆ ªÀåvÁå¸À«zÉ JAzÀgÉ ¸ÀjAiÀÄ®è."
From the above dictum of law it is crystal clear that When the accused had admitted the signature on the cheque in question the defence of the accused that the cheques were undated, irrelevant and change of ink and handwriting filled in the cheque cannot be considered unless the presumption is rebutted by the accused by cogent evidence. The admission of signature is sufficient to prove that cheques in question must have been issued in discharge of some legal liability-debt. From the above discussions the ruling is aptly applicable to the present fact of the case when the accused cheque and signature is proved by the complainant. Hence by virtue of section 118 and 139 of Negotiable Instruments Act and in view of the principle laid down by the Hon'ble Apex Court of India and various Hon'ble High Courts in 36 CC.No.14159/2016 catena of decisions the complainant discharged his initial burden and the presumption existed in favour of the holder of the cheque i.e., complainant. It is important to note that the burden was on accused to lead the rebuttal evidence to disprove the fact that he has not issued Ex.P2/cheque to the complainant for discharge of debt or liability but in this case accused has not rebutted and failed to prove his defence.
24. It is equally important to note that prior to filing of the complaint the accused got issued legal notice as per Ex.P4. The postal receipt is produced at Ex.P4(a) and the said notice is returned back as per Ex.P4(b) and return notice Ex.P4(bb). It is contended by the accused counsel that the notice not duly served to the accused per contra it is a contention of the complainant that the notice has been served to the proper address of the accused by RPAD. It is pertinent to note that in the cross examination of DW1 it is clearly admitted by the accused that he was residing at Basavanapura address 37 CC.No.14159/2016 earlier and now he was residing at Hosaroad Naganathapura Dr Layout, Electronic City, Bengaluru. The relevant portion of DW1 is as follows:
"£Á£ÀÄ ºÉƸÀ gÉÆÃqï, £ÁUÀ£ÁxÀ¥ÀÅgÀ qÁPÀÖgï ¯ÉÃOmï, J¯ÉPÁÖç¤Pï ¹n ¨ÉAUÀ¼ÀÆj£À°è ¸ÀĪÀiÁgÀÄ 2 ªÀµÀðUÀ½AzÀ ¨ÁrUÉ ªÀÄ£ÉAiÀÄ°è ªÁ¸ÀªÁVzÉÝãÉ. £Á£ÀÄ F »AzÉ §¸ÀªÀ£À¥ÀÅgÀ, §£ÉßÃgÀÄWÀlÖ, ¨ÉAUÀ¼ÀÆgÀÄ «¼Á¸ÀzÀ°è ªÁ¸À«zÉÝ."
Further in the cross examination it is deposed at page-5 it is admitted by the accused that he was residing in Basavanapura grama, Anekal Taluk. The said relevant portion of cross examination of DW1 is as follows:
"À£Á£ÀÄ §¸ÀªÀ£À¥ÀÅgÀ UÁæªÀÄ, D£ÉÃPÀ¯ï vÁ®ÆèQ£À «¼ÀÁ¸ÀzÀ°è ªÉÆzÀ®Ä ªÁ¸ÀªÁVzÉÝ JAzÀgÉ ¸Àj."
From this evidence of DW1 it is found that he was residing at Basavanapura Grama, Anekal taluk and on perusal of the notice Ex.P4 it is found that in the said address it is clearly mentioned that accused was residing in Basavanapura Anekal Taluk and the notice 38 CC.No.14159/2016 has been issued to the said address. It is pertinent to note that if at all the accused was not residing in the address mentioned in Ex.P4(b) and Ex.P4 he would have produce cogent evidence regarding the same. Further the accused contended that he is residing presently at Hosaroad Naganathapura Dr Layout, Electronic City, Bengaluru is also not proved by the accused by leading cogent evidence and relevant document.
25. At this juncture I would like to refer to the decisions of Hon'ble Apex Court of India reported in 2007 AIR SCW 3578 (C.C.Avavi Haji v/s Palapetty Muhammed & Anor).
On perusal the said ruling it is found that the Hon'ble Supreme Court held at para- 8 that :
Sec.138 of the act does not require that the notice should be given only by 'post', yet in a case where the sender as a dispatched the notice by post with correct address written on it, the principle incorporated in section 27 of the General Clause Act 1897 (for short GC Act) could profitably be imported 39 CC.No.14159/2016 in such a case. It was held that in this situation service of notice is deemed to have been affected on the sendee unless he proves that it was not really served and that he was not responsible for such non service. Further at para -10 it is held that : The requirement of clause (b) of the provisions of Sec.138 of the Act stands complied with and cause of action to file a complaint arises on the expiry of the period prescribed in clause (c) of the said proviso to Sec.138 for payment by the drawer of the cheque.
Nevertheless it would be without prejudice to the right of the drawer to show that he had now knowledge that the notice are brought to his address. This ruling is aptly applicable to the present case on the hand since the notice as per Ex.P4 is duly served to the proper address of the accused as admitted by him in the cross examination. It is clear dictum of law laid down by the Hon'ble Supreme Court that where the sender as a dispatched the notice by post with correct address written on it, the principle incorporated in section 27 of 40 CC.No.14159/2016 the General Clause Act 1897 (for short GC Act) could profitably be imported in such a case. The notice is sent through RPAD by the complainant to the admitted address of the accused mandatory requirement of issue of notice in terms of (b) of proviso to u/s 138 of N.I. Act stands complied with. Complainant counsel has also produced a ruling :
2005 CRL.L.J 4297 ANDHRA PRADESH HIGH COURT Crl. Revn Case No.914 of 2004 D/-29-7- 2005 (Polisetty Seetharamanjaneyulu and others v/s Public Prosecutor, High Court of A.P Hyderabad) (D) Negotiable Instruments Act (26 of 1881), S. 138-
Dishonour of cheque- Service of notice- complainant had sufficiently proved that notice were sent and accused got managed to return notice- That was sufficient compliance of S.138. General Clauses Act (1) of 1897), S 27 (2006) 6 Supreme Court Cases 456 (D.Vinod Shivappa v/s Nanda Belliappa) A. Negotiable Instrument Act, 1881- Ss.138 proviso (b),
(c) and 142 Deemed service of notice sent by registered 41 CC.No.14159/2016 post- Presumption of receipt of notice- When arises- Fraudulent avoidance of notice- Nature and proof- Held, when drawer refuses to accept the notice or when he evades service of the notice by fraudulent or unscrupulous means so that he envelope containing the notice is returned with a false endorsement such as the notice by the drawer- Whether service of notice was fraudulently avoided by the drawer is a question of fact to be determined by court on the basis of evidence on record".
Both these rulings are aptly applicable to the present facts and circumstances of the case. As discussed above the admission of the accused/DW1 in his evidence that he was residing in the address mentioned in the legal notice and the return cover Ex.P4(b) is sufficient to prove that the notice has been duly served to the address of the accused. The endorsement on the cover Ex.P4(b) is insufficient address though the address discloses clearly house number, the identification and the name of the place. Further there is no proper endorsement as to 42 CC.No.14159/2016 who have written the said remarks, the signature the name of the post man is not clear. Further there is no evidence by the accused to show that he was not residing in the said address on the date of the service of the notice. In view of the same the contention of the accused that the notice is not duly served when the service of notice is made to proper address through RPAD, cannot be taken into consideration.
26. The word 'unless contrary is proved' is discussed by the Hon'ble Apex Court in a decision reported in 2011 Crl.L.J 4647 (SC). It is observed that "the accused is under the obligation to prove his case in trial by leading cogent evidence that there was no debt or liability to the satisfaction of the Court". 'Unless contrary is proved' means the presumption has to be rebutted by proof and not by a bare explanation which is mere plausible. The said fact is said to be proved when its existence is directly established or when upon the material before it the 43 CC.No.14159/2016 Court finds its existence to be so probable that the reasonable man could act on the supposition that is exist. Therefore, unless explanation is supported by proof, the presumption created by the provisions cannot be said to be rebutted. On appreciation of evidence on record the explanation of accused is not supported by proof. Accordingly, I have no hesitation to arrive at the conclusion that accused has utterly failed to rebut the presumption.
27. On appreciation of entire evidence, this Court is of the opinion that the accused has miserably failed to prove the fact that there was no liability as on the date of issuing of the cheque and he has not issued cheque for discharge of legally enforceable debt. On the contrary, the complainant has proved that the accused has issued cheque/Ex.P2 for a sum of Rs.1,43,000/- towards discharge of legally enforceable debt and on presentation of the cheque, it was dishonored for the reasons 'Funds Insufficient'. Further it is proved by the 44 CC.No.14159/2016 complainant that after service of legal notice, the accused has not replied the notice and has not paid the cheque amount. Hence, in the considered view of this Court, the complainant has complied the provisions of Sec.142 and Sec. 138 of N.I. Act. Hence, I answer the above point No.1 in the affirmative.
28. Point No.2:- From the material from record it appears that accused is 41 years & working in KEB. Considering the age and avocation of the accused, also quantum of accused if the accused is sent to jail it will cause hardship to the accused and the family members. Having regard to the said facts and circumstance, prevailing rate of interest in the nationalized bank and litigation expenses I proceed to pass the following:
ORDER The accused is found guilty for the offence punishable u/s 138 of N.I. Act.
Acting u/s 264 of Cr.P.C. the accused is 45 CC.No.14159/2016 convicted and sentenced to pay fine of Rs.1,80,000/-, in default shall undergo simple imprisonment for two months.
Out of fine amount of Rs.1,80,000/- a sum of Rs.1,77,000/- is ordered to be paid to the complainant towards compensation u/s 357 of Cr.P.C. and the balance amount of Rs.3,000/- shall be remitted to the State.
The bail bond executed by the accused shall stand cancelled.
Supply free copy of the judgment to the accused. (Dictated to Stenographer directly on the Computer, taken print out corrected, signed by me and then pronounced in the open court this the 30th day of November, 2018) (ABDUL RAHIM HUSSAIN SHAIKH) XLII Addl. Chief Metropolitan Magistrate, Bangaluru.46 CC.No.14159/2016
ANNEXURE LIST OF WITNESSES EXAMINED ON BEHALF OF THE COMPLAINANT:-
PW1 : Sri H.T Nagaraj LIST OF WITNESSES EXAMINED ON BEHALF OF THE DEFENCE:-
DW1 : Sri. Thimmanna . B LIST OF DOCUMENTS MARKED ON BEHALF OF THE COMPLAINANT:-
Ex.P1 : Board resolution
Ex.P2 : Cheque
Ex.P2(a) : Signature of the accused
Ex.P3 : Bank Memo
Ex.P4 : Office copy of the legal notice
Ex.P4(a) : Postal receipt
Ex.P4(b) : Returned postal cover
Ex.P4(bb) : Legal notice found in
the returned Postal cover
Ex.P4(c) : Courier receipt
Ex.P5 : Chit agreement
Ex.P6 : Account extract
Ex.P7 : Complaint
Ex.P8 : Voucher
Ex.P9 : Surety proposal form
Ex.P10 : Guarantee agreement
Ex.P11 : Pronote
Ex.P12 : Chit commencement order
Ex.P13 : Chit commencement certificate
LIST OF DOCUMENTS MARKED ON BEHALF OF THE DEFENCE:-
Nil XLII Addl. Chief Metropolitan Magistrate, Bengaluru.47 CC.No.14159/2016
48 CC.No.14159/2016 Judgment pronounced in the open court vide separate order.
ORDER The accused is found guilty for the offence punishable u/s 138 of N.I. Act.
Acting u/s 264 of Cr.P.C. the accused is convicted and sentenced to pay fine of Rs.1,80,000/-, in default shall undergo simple imprisonment for two months.
Out of fine amount of Rs.1,80,000/- a sum of Rs.1,77,000/- is ordered to be paid to the complainant towards compensation u/s 357 of Cr.P.C. and the balance amount of Rs.3,000/- shall be remitted to the State.
The bail bond executed by the accused shall stand cancelled.
Supply free copy of the judgment to the accused.
XLII A.C.M.M, Bangaluru.49 CC.No.14159/2016