Bangalore District Court
M/S. Essilor India Pvt Ltd vs Ms. Mala on 2 November, 2022
KABC0C0032452019
IN THE COURT OF XXXIV ADDL. CHIEF METROPOLITAN
MAGISTRATE, MAYO HALL UNIT, BENGALURU. (ACMM34)
PRESENT: Smt.PARVEEN A BANKAPUR,B.Com.LLB.
XXXIV ADDL. CHIEF METROPOLITAN
MAGISTRATE,
Dated : This the 2nd day of November, 2022.
C.C.No.50814/2019
COMPLAINANT : M/s. Essilor India Pvt Ltd.,
Prestige Trader Tower,
10th Floor, No. 46, Palace Road,
High Grounds,
Sampangiramanagar,
Bengaluru - 560 001.
Rep by its SPA Holder
Mr. Prakash Raju V.
Aged about 37 years,
(By M/s. S.N. Rama Prasad
Advocates)
V/s
ACCUSED : 1. Ms. Mala
Authorized Signatory,
Vision Care Solutions,
No. 93, 4th Cross, Kempegowda
Nagar, T Dasarahalli,
Bengaluru 57.
2. Mr.Somashekar
Proprietor.
Vision Care Solutions
No. 93, 4th Cross,
Kempegowda Nagar, T Dasarahalli,
Bengaluru - 560 057.
(By Mr.Eshwar R. Naik Advocates)
1 Date of Commencement 10.10.2018
of offence
2 Date of report of offence 17.01.2019
3 Presence of accused
2 C.C.No.50814/2019
3a. Before the Court 12.07.2019
3b. Released on bail 12.07.2019
4 Name of the Complainant M/s.Essilor India Pvt Ltd.
5 Date of recording of 17.01.2019
evidence
6 Date of closure of evidence 12.10.2022
7 Offences alleged U/s 138 of the Negotiable
Instruments Act.
8 Opinion of Judge Accused are found guilty.
JUDGEMENT
The Private Complaint is filed under Section 200 of Cr.P.C against the accused alleging that they have committed the offence punishable under Section 138 of Negotiable Instruments Act.
2. The brief facts of the complaint are as follows:
The complainant submits that the Accused used to place orders for ophthalmic lenses based on which the Complainant used to supply the same to the Accused. Towards the payment of debt to the Complainant company, the Accused had issued the Cheque bearing No.052404 dtd.10.10.2018 for Rs.3,54,243/ drawn on IDBI Bank Ltd., Muttaiah Layout, Nelamangala Town, Bengaluru Rural and as per the instruction of the Accused, for the purpose of realizing the outstanding debt, the Complainant had presented the Cheque for 3 C.C.No.50814/2019 encashment through his banker Citi Bank, M.G. Road, Bengaluru on 16.11.2018. However, the said Cheque was returned for the reason for "funds insufficient" on 17.11.2018. After the endorsement the Complainant has got issued notice on 4.12.2018 and the same was returned as unclaimed. After receipt of the Legal Notice, the Accused has neither paid the Cheque amount nor replied the notice. Hence, the Accused have committed an offence punishable u/Sec.138 of N.I. Act.
3. After issuance of summons, accused appeared before the court and enlarged themselves on bail. Plea was recorded, read over and explained to the accused, who pleads not guilty and claims to be tried. Hence, the case is posted for complainant's evidence.
4. The Power of Attorney Holder of the Complainant company got examined himself as PW1 and got marked documents Ex.P1 to Ex.P.22 and closed his side.
5. Accused were examined U/S 313 of Cr.P.C. Incriminating evidence appearing in the complainant's evidence 4 C.C.No.50814/2019 was read over and explained to the accused who denies the same. The Accused persons did not tender their evidence.
6. Heard the learned Counsel fro Complainant. Since Accused and counsel for Accused remained absent, hence, arguments of Accused side taken as nil.
The learned Counsel for the Complainant has placed the following citations;
1. (2020) 1 SCC (Cri) 154 in the case of Uttam Ram V/s. Devinder Singh Hudan & another
2. (2018) 8 SCC 469 in the case of T.P. Murugan V/s. Bojan
3. (2015) 9 SCC 622 in the case of Mainuddin Abdul Sattar Shaikh V/s. Vijay D. Salvi
4. (2010) 11 SCC 441 in the case of Rangappa V/s. Sri Mohan
7. Upon hearing the arguments and on perusal of the materials placed on record, the following points arise for my consideration.
1) Whether complainant proves beyond all reasonable doubts that accused in discharge of legally recoverable debt has issued a Cheque bearing No.052404 dated 10.10.2018 for Rs.3,54,243/, drawn on IDBI Bank Ltd., Muttain Layout, Nelamangala Town, Bengaluru Rural Bidar in favour of the complainant which 5 C.C.No.50814/2019 came to be dishonoured with an endorsement "funds insufficient" on 17.11.2018 and in spite of knowledge of notice accused have not paid the Cheque amount and thereby committed an offence under Section 138 of N.I.Act?
2) What Order?
8. My findings on the above points is:
Point No.1: In the Affirmative.
Point No.2: As per final order for the following:
REASONS Point No.1:
9. Existence of legally recoverable debt is a sine qua non for prosecuting the case under Section 138 of Negotiable Instruments Act. For convenient purpose the essential ingredients to constitute offence under section 138 of N.I.Act is summarized as below:
(i) That there must be a legally enforceable debt.
(ii) That the cheque was drawn from the account of bank for discharge in whole or in part of any debt or other liability which presupposes the legally enforceable debt.
(iii)That the cheque so issued had been returned due to "funds insufficient".6 C.C.No.50814/2019
10. According to the Complainant the Complainant's company is in the business of processing and distributing ophthalmic lenses, equipments and allied products within India and abroad. Accused No.1 and 2 are Proprietors of the Accused company and as per the request of the Accused, has supplied the lenses. It is further submitted that the Accused used to issue Cheques towards payment of order, this was the business practice of the Accused. It is further submitted that towards discharge of their debt, the Accused issued Cheque bearing No.052404 dtd.10.10.2018 for an amount of Rs.3,54,243/ to the Complainant. When the Complainant presented the said Cheque through his banker, the Cheque was returned with an endorsement "funds insufficient" on 17.11.2018. It is further submitted that Complainant had issued legal notice to the Accused on 4.12.2018 and same was returned as unclaimed and accordingly, the Complainant has filed present complaint.
11. In order to bring home the guilt of the accused, the complainant has examined its Senior Manager, who authorized person of Complainant's company as PW1 and reiterated the contents of complaint in his examinationinchief. He has 7 C.C.No.50814/2019 placed original Cheque bearing No.052404 dtd.10.10.2018 issued by the Accused at Ex.P1, Ex.P2 is the bank challan, Ex.P3 is the endorsement of the bank, Ex.P4 is the office copy of legal notice issued by the Complainant to the Accused on 4.12.2018, Ex.P5 is the postal receipt, Ex.P6 is the returned postal cover with endorse unclaimed, Ex.P7 is the Spl. Power of Attorney, Ex.P8 is the Tax Invoice dtd.31.5.2018, Ex.P9 is the Tax Invoice dtd.31.5.2018, Ex.P10 is the Tax Invoice dtd.16.6.2018, Ex.P11 is the Tax Invoice dtd.16.6.2018, Ex.P12 is the Tax Invoice dtd.16.6.2018, Ex.P13 is the Tax Invoice dtd.30.6.2018, Ex.P14 is the Tax Invoice dtd.30.6.2018, Ex.P15 is the Tax Invoice dtd.16.7.2018, Ex.P16 is the Tax Invoice dtd.16.7.2018, Ex.P17 is the Tax Invoice dtd.31.7.2018, Ex.P18 is the Tax Invoice dtd.31.7.2018, Ex.P19 is the Custom Ledger Report for the period from 1.1.2017 to 25.10.2018, Ex.P20 is the Board Resolution, Ex.P21 is the Certificate u/Sec.65(b) of Indian Evidence Act. Ex.P22 is the Tax Invoice.
12. The documents produced by the complainant of course established that the complainant meets out the procedural requirements of Section 138 of Negotiable Instrument Act, but 8 C.C.No.50814/2019 it is to be considered whether all these documents establish the offence committed by the accused.
13. On perusal of the oral and documentary evidence placed by the complainant, it reveals that the present complaint is filed well within time in accordance with the provisions of Negotiable Instruments Act. Moreover, there is no dispute with regard to taking cognizance of the offence punishable under Section 138 of N.I. Act.
14. The Negotiable Instruments Act raises two presumptions. One contained in Section 118 and the other in Sec. 139 thereof. For the sake of convenience Sec 118(1) of the N.I. Act is extracted here below:
118. Presumptions as to negotiable Instruments Until the contrary is proved, the following presumptions shall be made ;
(a) of consideration 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.
1. To (g) . . . . . . . . . . . .
9 C.C.No.50814/2019Provided that where the instrument has been obtained from its lawful owner, or from an person in lawful custody thereof, by means of an offence of fraud, or has been obtained from the maker or acceptor thereof by means of an offence of fraud, or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him".
Further Section 139 of the Negotiable Instruments Act reads as under;
"139, Presumption in favour of holder. 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, of any debt or other liability."
15. Scope and ambit and function of the presumption U/s 118(a) and Sec 139 of NI Act came to be considered by the Hon'ble Apex Court of Indian in Krishna Janardhan Bhat Vs Dattatraya G.Hegde (2008 NIAR (Criminal 151) The Supreme Court has laid down the law in the following phraseology.
"D Negotiable Instruments Act 1881, Secs. 139, 138
--Presumption undersame arises in regard to 10 C.C.No.50814/2019 second aspect of the matter provided under Sec 138
--Existence of legally enforceable debt is not a matter of presumption under Sec 139 It merely raises presumption in favour of a holder of the cheque that the same has been issued for discharge of any debt or other liability - Merely an application of presumption contemplated under Section 139 of N.I.Act should not lead to injustice or mistaken conviction."
16. Further, said decision was followed by Hon'ble High Court of Karnataka in Kempanarasimhaiah Vs P.Rangaraju & Others (2008 (5) KCCR 3371). Relevant paragraph of the said judgment reads as under: "12. As to the provisions of Sections 138 of N.I.Act, the following principles emerge from the above observations of Hon'ble Supreme Court at para Nos. 21, 23, 25, 26 and 34 of its Judgment in the above said case of Krishna Janardhan Bhat Vs Dattatraya G.Hegde, AIR 2008 SC 1325.
(i) Section 139 of the Act merely raises a presumption that the cheque was issued towards discharge in whole or in part in any debt or other liability, which presupposed legally enforceable debt. Existence of legally recoverable debt is not a matter of presumption under Section 139 of the Act. It merely 11 C.C.No.50814/2019 raises a presumption in favour of a holder of the cheque that the same has been issued for discharge of any debt or other liability." (para 21)
(ii) The question as to whether the presumption stood rebutted or not, must be determined keeping in view the other evidences on record. Where the chances of false implication cannot be ruled out, the background fact and the conduct of the parties together with their legal requirements are required to be taken into consideration. (para 26)
(iii) An accused, for discharging the burden of proof placed upon him under a statute, need not examine himself. He may discharge his burden on the basis of the materials already brought on records (para 23)
(iv) Standard of proof on the part of an accused and that of the prosecution in a criminal case is different.
Further more where as prosecution must prove the guilt of an accused beyond all reasonable doubt, the standard of proof so as to prove a defence on the part of an accused is "preponderance of probabilities'"
(para 23 & 25)
(v) Inference of preponderance of probabilities can be drawn not only from the materials brought on records by the parties but also by reference to the circumstances upon which he relies (para 25) 12 C.C.No.50814/2019
(vi) Other important principles of legal jurisprudence, namely presumption of innocence as human rights and the doctrine of reverse burden introduced by Section 139 should be deliberately balanced (para 34)
17. Thus from the observations extracted above, it is clear that presumption Under Section 139 of the N.I,.Act is only to the extent that the cheque was drawn for discharge in full or in part of any debt or other liability and the said presumption do not relate to the existence of legally enforceable debt or liability.
Therefore, before drawing the presumption under section 139 of the N.I.Act, it is the duty of the Court to see whether or not the complainant has discharged his initial burden as to existence of legally enforceable debt. No doubt, as per Section 118(a) of the Act, there is a rebuttable presumption that every negotiable instrument, is accepted, endorsed, negotiated or transferred was accepted, endorsed, negotiated or transferred for consideration."
18. Factual matrix of the case is required to be tested on the anvil of principles emerging from the abovereferred decisions.
13 C.C.No.50814/2019
19. In order to substantiate his claim, the Spl. Power of Attorney Holder of the Complainant's company has examined as PW1 and placed above said documents at Ex.P1 to Ex.P22. After taking sufficient time and opportunity, the Accused did not came before the court for tendering their cross examination. After taking sufficient time and opportunity the Accused persons have not available for crossexamination and put forth their defence. Therefore, the evidence of the PW1 is not challenged and not questioned.
20. The learned Counsel for Complainant vehemently argued that mere and simple denial of the outstanding debt is not enough to rebut the presumption u/Sec.139 of N.I. Act. The Accused has to rebut the presumption and rather bring such facts and circumstances as a probable defence to shift the burden of proof on the Complainant. In the instant case, the Accused has only made mere denials and failed to rebut the presumption u/Sec.139 of N.I. Act.
21. In this regard the learned Counsel for Complainant relied decision of Hon'ble Apex Court in (2020) 1 SCC (Cri) 154 14 C.C.No.50814/2019 in the case of Uttam Ram V/s. Devinder Singh Hudan and another, wherein the Hon'ble Apex Court held that;
"There is the mandate of presumption of consideration in terms of the provisions of the Act. The onus shifts to the Accused on proof of issuance of Cheque to rebut the presumption that the Cheque was issued not for a discharge of any debt or liability in terms of Sec.138 of the Act which reads as under;
"138 - Dishonour of Cheque for insufficiency, ete., of funds in the account - Where any Cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or Cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall ....... ."
22. Further, the learned Counsel for the Complainant relied on another decision in (2018) 8 SCC 469 in the case of T.P. Murugan V/s. Bojan. In this decision also the Hon'ble Apex Court held that;
15 C.C.No.50814/2019
"The respondent/Accused has failed to produce any credible evidence to rebut the statutory presumption."
23. In the present case also the Accused has not placed any credible evidence to rebut the presumption. Further, if the Accused failed to rebut the presumption by adducing any cogent evidence, the presumption u/Sec.139 of N.I. Act shall operate.
24. Further, the learned Counsel for the Complainant relied (2010 ) 11 SCC 441 in the case of Rangappa V/s. Sri Mohan wherein, the Hon'ble Apex Court held that ;
"The Accused has to rebut the presumption u/Sec.139 , the standard of proof of doing so is that of "preponderance of probabilities". Therefore, if the Accused is able to raise a probable defence that creates doubt about the existence of a legally enforceable debt or liability, the prosecution can fail. The Accused can rely on the materials submitted by the Complainant in order to raise such a defence and it is conceivable that in some cases the Accused may not need to adduce evidence of his own."16 C.C.No.50814/2019
25. In the present case, the Accused has not put forth his defence by way of crossexamining the Complainant nor he has adduced his defence evidence.
26. It is also significant to note that, even though the complainant has examined himself as PW1 and reiterated the contents of complaint in his examinationinchief affidavit, accused failed to crossexamine PW1 inspite of availing sufficient opportunities. The complainantPW1 categorically stated in his examinationinchief the accused has issued the cheque in question to discharge the legally recoverable debt. This testimony of PW1 remained uncontraverted and unchallenged. Under such circumstances, whatever version given by the PW1 is to be accepted as true. This view is fortified by the ration laid down by Hon'ble High Court of Karnataka in Smt. Vimalabai Vs. Babu and Another (2003(2) Kar.L.J. 301) which reads as under:
(D) INDIAN EVIDENCE ACT, 1872, Sections 137, 138 AND 155Crossexamination of opponent's witnessPresumption arising from failure to hold--
Party should put his case in crossexamination of witness of opposite party, and failure to cross 17 C.C.No.50814/2019 examine gives rise to presumption that account given by opponent's witness is acceptable."
27. The said view is also reiterated in the ratio laid down by Hon'ble Apex Court of India, in 2003 (1) SCC 240 (Sarwan Singh V/S State of Punjab), may be usefully referred, which reads thus:
"E. Criminal Trial-Appreciation of evidence Generallywhenever opponent declines to avail himself of the opportunity to put his case in cross examination, it must follow that the evidence tendered on that issue ought to be accepted".
28. Hence, by applying the above said ratio to the facts of the present case, whatever version given by the PW1 is to be accepted as true. Because, admittedly PW1 has not been crossexamined by the accused.
29. Therefore, complainant has discharged his initial onus laid on him. When he has discharged his initial onus, it raises presumption U/s 118(a) and 139 of Negotiable 18 C.C.No.50814/2019 Instruments Act. Accused has failed to rebut the presumption either by crossexamining PW1 or by leading his evidence.
30. In the instant case also, accused has outstanding due from the complainant and has failed to keep up his promise which amounts to unjust enrichment for which complainant is to be compensated.
31. Hence, I conclude that complainant is able to prove beyond all reasonable doubts that accused has committed the offence punishable U/s 138 of NI Act.
32. There is no material on record to show that there was contractual rate of interest for repayment of amount. Therefore, I am of the view that it is just and necessary to direct the Accused to pay 6% interest on cheques amount from the date of cheques till payment. Therefore, the Complainant is entitled for the 6% of interest on cheques amount from the date of cheques till payment. Accordingly, the Point No.1 is answered in Affirmative.
19 C.C.No.50814/2019
33. POINT No.2 : In view of discussion held in Point No.1, I proceed to pass the following :
ORDER Acting U/S 255(2) of Cr.P.C., the accused are convicted for the offence punishable Under Section 138 of Negotiable Instrument Act. Accused are sentenced to pay fine of Rs.4,39,261/ (Rupees Four Lakhs Thirtynine Thousand Two Hundred Sixtyone only) in default to undergo simple imprisonment for 6 months. Further, it is made clear that out of fine amount, Rs.4,34,261/ (Rupees Four Lakhs Thirtyfour Thousand Two Hundred and Sixtyone only) is to be paid to the complainant as compensation and Rs.5,000/ is ordered to be remitted to the State.
Bail bond stands cancelled.
Supply the free copy of this judgement to the Accused forthwith.
(Dictated to the stenographer, transcribed by her, corrected by me and then pronounced in the open court on this 2nd November, 2022) (PARVEEN A BANKAPUR) XXXIV ACMM, BENGALURU.
ANNEXURE
1. Witnesses examined on behalf of Complainant:
P.W.1 Mr. Prakash Raju V. 20 C.C.No.50814/2019
2. Documents marked on behalf of complainant:
Ex.P.1 Notarized copy of Power of Attorney Ex.P.2 Bank challan Ex.P.3 Bank endorsement Ex.P.4 Office copy of Legal Notice Ex.P.5 Postal receipt Ex.P.6 Unserved Postal cover Ex.P.7 Spl.Power of Attorney Ex.P.8 to Tax Invoices Ex.P.18 Ex.P.19 Custom Ledger Report Ex.P.20 Board resolution Ex.P.21 Certificate u/Sec.65B(4) of Indian Evidence Act Ex.P.22 Tax Invoice
3. Witnesses examined on behalf of Accused : NIL
4. Documents marked on behalf of Accused: NIL (PARVEEN A BANKAPUR) XXXIV ACMM, BENGALURU.