Bangalore District Court
Shaikh Mohammed Zakariya vs M/S Smyl Agro on 3 October, 2025
KABC0C0002902021
IN THE COURT OF XXXIII ADDL. CHIEF JUDICIAL
MAGISTRATE, MAYO HALL UNIT, BENGALURU
-: PRESENT:-
P.S. Santhosh Kumar, M.Com., LL.M.,
XXXIII ADDL.CHIEF JUDICIAL MAGISTRATE,
BENGALURU.
DATED THIS THE 3RD DAY OF OCTOBER, 2025.
C.C.NO.50077/2021
COMPLAINANT : Mr. Shaikh Mohammed
Zakariya,
S/o. Shaikh Ahmed,
Aged about 48 years,
R/at. No.8/A, Subhash nagar,
Bhattarahalli, Behind Karnataka
Medicals, Old Madras road,
Bangalore-560049.
(Mobile No.+91 9019841965.
[email protected])
[By Sri. Kishan Dutt Kalaskar
and Mrs. Anindita Chakraborty,
Advocates]
Vs.
ACCUSED : M/s. SMYL AGRO,
Represented by its Proprietor
Mr. Yahya Shaikh,
Having office at shop No.6,
Asmita Regency, Station road,
2
C.C.No.50077/2021
Opposite to Asmita Club, Mira
road (E), District Thane-401107.
MAHARASHTRA.
(Mob: 9004144555
[email protected])
[By Sri. Sunil Ambi and Sri.
Umesh Ambi., Advocates]
J U D G M E N T
The complainant has filed this private complaint U/s.200 of Cr.P.C., against the accused for the offence punishable U/s 138 of Negotiable Instrument Act.
2. The factual matrix of the case are as follows:-
The accused is running a business in the name and style of M/s. SMYL AGRO. The accused is also having business of goat farming/breeding in Boisar and also the same business in Rajasthan. The accused issued paper publication inviting for investments and approached the complainant and accordingly, complainant invested the amounts. The accused being the Proprietor of M/s. SMYL AGRO approached the complainant for investment of Rs.29,50,000/- in the 3 C.C.No.50077/2021 business of the accused and accordingly, by executing four Memorandums of Understanding, one MoU dated 07.06.2019 and other three MoU's dated 04.05.2019, has invested the aforesaid amounts. The accused agreed to pay (7 to 7.5%) profits to the complainant at the percentage agreed in the MoU. The accused shared the profit for around two months and thereafter, totally stopped sharing of profits. Against the MoU dated 07.06.2019, the accused has received Rs.7,00,000/- and the receipt of the same has been issued by the accused. Even after completion of one year, the accused was neither sharing the profits as undertaken by them as per the MoU's or returned the principal amount. The transaction took place through Bank and cash as well. Further the accused issued five cheques for Rs.29,00,000/- out of which one cheque amounting to Rs.7,00,000/- was presented in SBI Doorvaninagar branch, Bengaluru. The complainant is the permanent resident of Bengaluru and maintaining his permanent Bank account in Bengaluru city only.
The complainant has approached and requested the 4 C.C.No.50077/2021 accused to pay the principal amount of Rs.29,50,000/- which is inclusive of Rs.7,00,000/- invested against MoU 07.06.2020, but the accused has only prolonged the matter and finally, issued five cheques totally amounting to Rs.29,50,000/- drawn on HDFC Bank, Mumbai, for repaying the investment. The details of the five cheques issued by the accused are as follows:-
(a) The cheque bearing No.000109 dated 31.07.2020 for Rs.6,50,000/- drawn on HDFC Bank, ATPAR branch, Thane, Maharashtra.
(b) The cheque bearing No.000107 dated 31.07.2020 for Rs.7,00,000/- drawn on HDFC Bank, ATPAR branch, Thane, Maharashtra.
(c) The cheque bearing No.000108 dated 31.07.2020 for Rs.8,00,000/- drawn on HDFC Bank, ATPAR branch, Thane, Maharashtra.
(d) The cheque bearing No.000121 dated 10.07.2020 for Rs.7,00,000/- drawn on HDFC Bank, ATPAR branch, Thane, Maharashtra.
(e) The cheque bearing No.000111 dated 31.07.2020 for Rs.1,00,000/- drawn on HDFC Bank, ATPAR branch, Thane, Maharashtra.
The complainant presented the cheque bearing No.000121 for encashment through his banker State 5 C.C.No.50077/2021 Bank of India, Doorvaninagar, Bangalore, on 07.10.2020, but the said cheque came to be dishonored for the reason "Funds insufficient" vide. bank endorsement dated 07.10.2020. Thereafter, the complainant got issued legal notice to the accused on 04.11.2020 demanding payment of the cheque amount. But, inspite of service of it on 05.11.2020, the accused has failed to pay the cheque amount. Hence, the accused has committed the offence punishable U/s.138 of Negotiable Instruments Act.
3. Based on the complaint, the sworn statement affidavit, the documents, etc., the court took cognizance of an offence punishable under Sec.138 of the Negotiable Instruments Act by following the guidelines of Apex Court issued in Indian Bank Association's case and ordered to register a criminal case against the accused for the offence punishable U/ s.138 of Negotiable Instruments Act.
6C.C.No.50077/2021
4. In pursuance of summons, the accused appeared through his counsel, he was enlarged on court bail, further, substance of plea was recorded, the accused pleaded not guilty and he claimed to be tried. The complainant in order to prove his case, got examined himself as P.W.1 and got marked Ex.P1 to P7. Upon closure of complainant's side evidence, the case was set down for recording the statement of the accused U/sec.313 of Cr.P.C, but, the accused did not turn up despite of sufficient opportunity given for giving his explanation on the incriminating materials on record, as such, in view of decision of Hon'ble High Court of Karnataka between Kulkarni Vs. Dakshina Murthy the examination of accused U/S 313 of Cr.P.C., dispensed as the accused purposefully avoided and also accused not chosen to lead defence evidence.
5. Inspite of sufficient opportunity, neither the complainant nor the accused addressed their arguments. Perused the materials on record.
7C.C.No.50077/2021
6. The following points would arise for my consideration:-
1. Whether the complainant proves beyond all reasonable doubts that the accused has committed an o/p/u/s 138 of the Negotiable Instruments Act?
2. What Order?
7. My findings on the above points are as follows;
Point No.1: In the Affirmative, Point No.2: As per final order, for the following, R E A S O N S
8. POINT No.1:- I have gone through the materials available on record. The complainant, who has been examined as PW.1, has reiterated the facts stated in his complaint in his chief examination also. In addition to it, he has produced 7 documents which are marked as Ex.P1 to 7.
9. Ex.P1 is the original cheque bearing No.000121 dated 10.07.2020 for Rs.7,00,000/- drawn on HDFC 8 C.C.No.50077/2021 Bank, ATPAR branch, Thane, Maharashtra, said to have been issued by the accused in favour of the complainant. Ex.P2 is the bank endorsement which goes to show that the said cheque came to be dishonored for the reason "Funds insufficient" vide. endorsement dated 07.10.2020. Ex.P3 is the Memorandum of Understanding dated 07.06.2019. Ex.P4 is the copy of the legal notice dated 04.11.2020 said to have been issued by the complainant to the accused calling upon him to pay the cheque amount. Ex.P5 is the postal receipt for having sent legal notice to the accused. Ex.P6 is the returned postal cover which goes to show that the notice sent was returned unserved with a shara 'unclaimed'. Ex.P7 is the loan receipt. It is relevant to mention here that the accused has not disputed the issuance of cheque in question and the signature of the accused appearing on it. Such being the case, the initial presumption as contemplated U/Sec.139 of the N.I Act has to be raised by the court in favour of the complainant as per the decision reported in AIR 2010 SC 1898 in the 9 C.C.No.50077/2021 case of Sri Rangappa Vs. Sri Mohan of the Hon'ble Supreme Court of India.
10. Once the presumption U/S 139 and 118 of the N.I Act is raised, it is for the accused to rebut the said presumptions by adducing cogent evidence in support of his defence, if any. It is relevant to mention here that the accused in the present case has not lead any defence evidence and even he has not cross-examined the PW1. Even the accused remained diligently absent and did not turn up for his examination u/sec.313 of Cr.P.C. Further the accused has not issued any reply notice. As such, in the facts and circumstances of the case, I am of the opinion that the complainant has categorically established beyond all reasonable doubts that the accused had issued Ex.P1 towards a legally enforceable debt and inspite of issuance of notice at Ex.P4 intimating the fact of dishonour of cheque at Ex.P1, has failed to discharge the same and as such, the accused has committed the offence punishable under Sec.138 of Negotiable Instruments Act.
10C.C.No.50077/2021
11. It is relevant to mention here that the accused having issued cheque at Ex.P1 in favour of the complainant has failed to pay the cheque amount and hence, the complainant is to be suitably compensated for the delay caused by the accused in its repayment. Further the punishment prescribed for the offence U/s.138 of Negotiable Instruments Act is imprisonment for a period which may extend to two years or with fine which may extend to twice the amount of the cheque or with both. Considering the facts and circumstances of this case, nature, year of the transaction, nature of the instrument involved, cost of litigation and the rate of interest proposed by Hon'ble Supreme Court in 2012 (1) SCC 260 (R.Vijayan Vs Baby), I am of the opinion that it is just and desirable to impose fine of Rs.10,35,000/- and out of the said amount, it seems to be proper to award a sum of Rs.10,30,000/- as compensation to the complainant as provided U/s.357(1) of Cr.P.C and the remaining sum of Rs.5,000/- shall go to the State 11 C.C.No.50077/2021 towards expenses. With these observations, my findings on Point No.1 is in the Affirmative.
12. Point No.2: In view of my findings on Point No.1, I proceed to pass following;
O R D E R
Acting u/s. 255(2) of Cr.P.C., the
accused is hereby convicted for the offence punishable u/s.138 of Negotiable Instrument Act,1881.
The accused is hereby sentenced to pay a fine of Rs.10,35,000/-. In default, the accused shall undergo simple imprisonment for 6 months.
Out of the fine amount, Rs.5,000/-
shall be paid to the State towards expenses and remaining amount of Rs.10,30,000/- to the complainant as compensation as per the provisions of Sec.357(1) of Cr.P.C.
12C.C.No.50077/2021 Further, it is made clear that in view of proviso to Sec.421(1) of Cr.P.C, the accused would not be absolved from his liability to pay compensation amount of Rs.10,30,000/- awarded u/s.357 of Cr.P.C. even if he undergoes the default sentence.
The bail bond and cash security are ordered to be continued till expiry of the appeal period.
Office is directed to furnish free copy of this judgment to the accused forthwit h.
(Typed to my dictation directly over computer by the Stenographer, corrected, signed and then pronounced by me in the open court, on this the 3rd day of October 2025) (P.S. Santhosh Kumar), XXXIII ACJM, BENGALURU.
A N N E X U R E
1. Witnesses examined on behalf of Complainant:
P.W.1 : Mr. Shaikh Mohammed Zakariya
2. Documents marked on behalf of complainant:
Ex.P.1 : Original cheque
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C.C.No.50077/2021
Ex.P.1(a) : Signatures of the accused
Ex.P.2 : Bank endorsement
Ex.P.3 : MoU dated 07.06.2019
Ex.P.4 : Office copy of the legal notice
Ex.P.5 : Postal receipt
Ex.P.6 : Returned postal cover
Ex.P.7 : Loan receipt
3. Witnesses examined on behalf of Accused:
NIL
4. Documents marked on behalf of Accused:
NIL (P.S. Santhosh Kumar), XXXIII ACJM, BENGALURU.