Bangalore District Court
Sumuk International Trading Inc Rept By ... vs S M Computers And Technologies Rept By ... on 1 August, 2024
KABC010299392022
IN THE COURT OF THE LII ADDL. CITY CIVIL &
SESSIONS JUDGE, BANGALORE (CCH-53)
Dated this the 1st day of August , 2024
PRESENT
Sri.Gangappa Irappa Patil., B.A., LL.B(Spl).,
LII Addl. City Civil & Sessions Judge,
Bangalore.
Crl.A.No.1346/2022
Appellant/ SUMUK INTERNATIONAL TRADING INC
Accused: Rep.by its Proprietor/Authorized by
Smt. Vinuta Pai, D/o Late Rajeeva
office at No.19/2,
Shree Meena Residency Akai Public School Road
Nagashettyhalli, Sanjaynagar,
Bengaluru -560 094
(By Smt. Sharadi S. Shetty, Advocate)
-V/S-
Respondent/ S.M.Computers & Technologies Rep.by its
Complainant Proprietor Mr.K.S.Sandeep Shetty, Office at
#212, Opp.Muneshwara Temple Ground Floor,
Nagashettyhalli, Sanjaynagar, Bengaluru-560
094.
(By Sri.B.M.V., Advocate)
2
Crl.A.No.1346/2022
JUDGMENT
This appeal is filed by the Appellant praying to set-aside the judgment of conviction and sentence dated 15.09.2022 passed by learned XVIII Addl. Chief Metropolitan Magistrate Bengaluru in C.C.No.28454/2019 and to acquit him in the said case.
2. The appellant of this appeal was the accused before the Trial Court. The respondent of this appeal was the complainant before the Trial court. The rank of the parties to this appeal will be hereinafter referred to with the same rank as assigned to them before the trial court for the sake of convenience.
3. The brief facts which leads to file this appeal in nutshell are as follows:
The accused is very well-known person and best friend of the complainant. In that acquaintance, the accused has approached the complainant for hand loan of Rs.4,00,000/- for purpose of her business and legal necessities and also promised to repay the same within a short period. Considering her request, the complainant has paid Rs.4,00,000/- to the accused through RTGS on 5.11.2018. But she has not kept up her promise. After several request and demand made by the complainant to repay the loan, the accused has issued cheque bearing No. 027085 for Rs.4,00,000/- dated 5.9.2019 drawn on Axis Bank, Ganganagar, Bengaluru and also promised that the cheque will be honoured on its presentation. The complainant has presented the said cheque for encashment on 05-09-2019 through 3 Crl.A.No.1346/2022 its bank, but the said cheque was dishonoured for "PAΥΜΕΝΤ STOPPED BY DRAWER" dated 07.09.2019. Thereafter, the complainant has got issued demand notice on 16-09-2019 to the accused through RPAD by demanding the payment of cheque amount. Though the accused received the said notice, she has not made payment of the cheque amount . Thereby accused committed the offence punishable u/s 138 of NI Act.
4. The Trial Court after taking cognizance of the offence issued summons to the accused. In pursuance of the summons, the accused appeared through his counsel and got enlarged on bail. The sum and substance of the accusation has been read over to the accused and he denied the same and submitted that she has defence to make.
5. The complainant himself examined as PW.1 and he got marked Ex.P.1 to Ex.P.8 on his behalf. After completion of evidence of the complainant side, statement under section 313 of Cr. P.C. was recorded. Accused did not choose to lead evidence. Upon hearing both the parties, the Trial court has convicted the accused. Being Aggrieved by the impugned judgment passed by the Trial court, the appellant has preferred this appeal on the following 4 Crl.A.No.1346/2022 Grounds
a) The impugned judgment passed by the Trial Court is pervese, arbitrary, illegal and against to the law in force.
b) The complaint of the complainant itself is not maintainable as the said complaint has been filed by the complainant by misusing the cheque given by the accused/appellant.
c) The Trial Court has not considered some of the crucial aspects and passed the impugned judgment without considering the defence evidence and documents produced by the accused/appellant.
d) To prove his contention of legal notice he has submitted two tracking consignments which are marked as Ex.P. 6 and Ex.P. 7. Ex.P6 is the online downloaded copy and Ex.P7 is the screenshot that is taken over the mobile phone. Both the exhibits are the digital evidence which can only be relied upon with the section 65 B Certificate.
e) Moreover the complainant has failed to produce the acknowledgment to whom the legal notice was sent and who has received it. It is not correct to come to the conclusion by only considering Ex.P. 6 and Ex.P. 7, most importantly in the absence of 65B certificate.
5Crl.A.No.1346/2022 On these and other grounds as urged in the appeal memorandum, the appellant/accused has prayed to allow the appeal and prayed to acquit him for the offence punishable u/s. 138 of NI Act.
6. After filing of the appeal, it is registered as Crl.A.No.1346/2022 and notice was issued to the respondent. After service of the notice, the respondent has appeared before the court through his counsel. Thereafter, the trial court record was called for. After securing the trial court record, the matter was posted for arguments.
7. Heard the arguments. Perused the appeal memorandum, trial court record and other materials on record.
8. The points that arise for consideration before this court are as under:
(1) Whether the judgment passed by the trial court is just and proper and in accordance with law?
(2) Whether the interference of this court is required in the impugned judgment of the trial court?
(3) What order?
9. The findings on the above points are as under:
(1) Point No.1 .. In the Affirmative
(2) Point No.2 .. In the Negative.
(3) Point No.3 .. As per final order
6
Crl.A.No.1346/2022
for the following:
REASONS
10. Point No.1 and 2 :- These two points are interrelated to each other and as such, they are taken together for discussion to avoid repetition of facts.
11. The complainant had filed private complaint before the trial court u/Sec.200 of Cr.P.C. by alleging the commission of offence u/Sec.138 of N.I. Act by the accused. Since the complainant had alleged that the accused had committed the offence punishable u/Sec.138 of N.I. Act, it is for the complainant to prove all the essential ingredients of Sec.138 of N.I. Act. Hence, it is relevant to note down the provisions of Sec.138 of N.I.Act herein, in order to know its essential ingredients.
12. Sec.138 of N.I. Act provides as follows:
"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 other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the 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, without prejudice to any other provisions of this Act, be punished with imprisonment for (a term 7 Crl.A.No.1346/2022 which may be extended to two years), or with fine which may extend to twice the amount of the cheque or with both. "
13. Thus from reading the aforesaid section, it is clear that the complainant has to prove the following essential ingredients for holding the accused guilty of offence under the said section.
(a) The cheque has been drawn by the accused on Bank account which is maintained by him with a particular Banker.
(b) The amount of money mentioned in the cheque is for discharging the legal liability either wholly or partially and
(c) The cheque is dishonoured or it is returned unpaid due to insufficiency of funds etc.,
(d) Issuance of notice in writing to the drawer of the cheque demanding payments of the cheque amount.
(e) Failure of the drawer to make payment within receipt of the demand notice.
14. The Complainant has filed this complaint alleging that the accused has committed offence punishable under section 138 of N.I. Act. The complainant pleads and asserts that, the accused being the proprietor of Sumuk International Trading INC in discharge of her liability has issued cheque bearing No.027085 dated 5.9.2019 for Rs.4,00,000/-. The complainant has presented the said cheque 8 Crl.A.No.1346/2022 for encashment through its banker. But the said cheque was returned unpaid with an endorsement "Payment stopped by drawer"
on 07-09-2019. Thereafter, the complainant got issued demand notice on 16-09-2019 to the accused by demanding the payment of cheque amount. Despite of the service of notice the accused has not paid the amount within 15 days, which gave raise cause of action to file this complaint.
15. The presumption is available in favour of the complainant under Section 139 of the Negotiable Instruments Act and accused is having an opportunity to rebut the same.
16. To substantiate its case, the proprietor of the complainant has stepped into witness box and examined as PW.I and got marked 8 documents as Ex.P-1 to Ex.P-8. PW1 has reiterated the contents of the complaint in his affidavit evidence about lending of loan to the accused, issuance of cheque by the accused towards discharge of her liability and its dishonour for "Payment stopped by drawer", issuance of legal notice to the accused calling upon her to pay the amount covered under cheque and her failure to comply the same.
17. This court has scrutinised the documents relied by complainant in order to examine the compliance of statutory requirements envisaged under section 138 of N.I. Act. Ex.P.1 is cheque dated 05.09.2019. The said cheque was returned unpaid with an endorsement "Payment stopped by drawer" as per Ex.P.2 9 Crl.A.No.1346/2022 bank endorsement dated 06.09.2019, Ex.P.3 is legal notice dated 16-09-2019 under which the complainant has demanded the payment of cheque amount, Ex.P.4 is postal receipts, Ex.P5 is Unserved Postal covers, Ex.P.6 & 7 are Postal track consignment details and Ex.P.8 is Bank statement. On careful scrutiny of the documents relied by the complainant goes to show that, statutory requirements of section 138 of N.I. Act have been complied with and this complaint is filed within time. The proprietor of the complainant by examining as PWI and by producing aforesaid documents has discharged his initial burden.
18. The accused has specifically denied the availing of hand loan of Rs.4,00,000/- from the complainant and issuance of cheque in question for repayment of alleged loan of Rs.4 lakhs. The accused has putforth her defence that during the earlier transaction the complainant has obtained cheque from her brother Ritesh Bangera for security purpose and same has been misused to file the present false case. There is no existence of legal enforceable debt as such section 138 of NI Act is not applicable to the cheque in question. The accused also contended that no notice was served on her as per section 138 (b) of NI Act.
19. In the back drop of the aforesaid rival contentions this court has given anxious consideration to the materials on record and the submissions made by the learned counsel for complainant and the accused. At the outset, it is pertinent to state that the 10 Crl.A.No.1346/2022 accused has not disputed the issuance of cheque in question and signature found in the said cheque. The only contention of the accused so far as issuance of cheque is that during the earlier transaction the complainant has collected cheque from the brother of the accused for security purpose and misused the same to file false case. On perusal of the Ex.P.1 cheque, it appears that the said cheque was drawn on an account maintained by accused firm. The said firm is a proprietor concerned firm and represented by its proprietor/authorized signatory Smt. Vinuta Pai. The proprietor of the accused firm Smt. Vinuta Pai has not disputed the issuance of cheque as well as her signature in the Ex.P.1 cheque. The Hon'ble Supreme Court in M/S Kalamani Tex and another V/s P. Balasubramanian (2021) 5 SCC 283 has held that the Statute mandates that once the signature(s) of an accused on the cheque/negotiable instrument are established, then these 'reverse onus' clauses become operative, such a situation, the obligation shifts upon the accused to discharge the presumption imposed upon him. Therefore once the drawer has admitted the issuance of cheque as well as on the signature present therein or it is established that signature in cheque belongs to accused, then the presumption envisaged under section 118 and 139 of NI Act, would operate in favour of the complainant. The said provision lays down a special rule of evidence applicable to negotiable presumption is one of law and thereunder court shall presume that the Negotiable instrument was endorsed for consideration. So, also in the absence of contrary 11 Crl.A.No.1346/2022 evidence on behalf of the accused, the presumption under section 118 and 139 of NI Act goes in favour of the complainant.
20. In the present case as stated above the accused has not disputed their signaltures in the Ex.PI cheque. As such presumption under section 118 and 139 of NI Act has to be drawn in favour of the complainant. Section 118 reads as "That every negotiable instrument was made or drawn for consideration and that every such instrument when it has been accepted, endorsed, negotiated or transferred was accepted, endorsed, negotiated or transferred for consideration". Further Section 139 of the Negotiable Instruments Act provides for presumption in favour of a holder. It reads as, "It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in section 138, for the discharge, in whole or in part, or any debt or other liability." A combined reading of above said sections raises a presumption in favour of the holder of the cheque that he has received the same for discharge in whole or in part of any debt or other liability. No doubt, the said statutory presumption are rebuttable in nature. It is for the accused to probable defence to rebut the presumption raised in favour of the complainant. It is worth to note that section 106 of Indian of Indian Evidence Act postulates the burden is on the accused to establish the fact which is especially within his special knowledge. This provision is except to the General Rule, that the burden of proof is always on the prosecution to establish their case beyond all reasonable doubt. In 12 Crl.A.No.1346/2022 that view of the matter, the burden is on the accused to prove that the cheque in question was not issued for discharge of any debt of liability but it was issued during the earlier transaction for the purpose of security.
21. In order to rebut the said presumptions and to prove her defence, the accused has fully cross examined PWI, but she has neither led any defence evidence nor produced any documents. During the cross-examination it was suggested to PWI that during the earlier transaction he has obtained cheque from the accused for the purpose of security and misused the said cheque to file false. But PWI has denied the said suggestion in clear terms. Nothing has been elicited in the mouth of PWI in support of the defence taken by the accused. Therefore, the evidence of complainant remained unchallenged. Apart from that the complainant has produced his Bank statement Ex.P.8 to prove that on 05.11.2018 has transferred Rs.4,00,000/- through RTGS to the account of accused, On perusal of Ex.P.8 it appears that the complainant has transferred Rs.4,00,000/- to the accused account through RTGS on 05.11.2018, The accused has not produced any evidence to say that she has repaid the said amount to the complainant. The learned counsel for the accused has argued that the complainant has not produced certificate under section 65B of Indian Evidence Act in respect of Ex.P8 bank statement as held by the Hon'ble Supreme court Arjun Panditrao Khotkar case (2020) 7 SCC1 and Anvar P V case (2014) 10 SCC 473. No doubt the Ex.P8 bank statement is not contained any 13 Crl.A.No.1346/2022 seal or signature of Bank manager and the complainant has not field any certificate along with Ex.P8. But during the cross- examination the accused has not disputed the same. Only during the argument he has raised the said contention. Even the said Bank statement kept aside as not complied section 65B of Evidnece Act, there is presumption under section 139 of NI Act that the cheque in question was issued for discharge of legally enforceable debt or liability since the accused has not disputed the signature in the cheque. The said presumption has to be rebutted by raising probable defence in the form of preponderance of probability. But the accused has not stepped into witness box to explain how and what manner the cheque in question was placed in hand of complainant. Hence, it is clear that the accused has issued Ex.P.1 cheque for repayment of the afore said debt. The said cheque came to be dishonoured for payment stopped by drawer. The accused has not produced her bank statement to show that as on the date of presentation of Ex.P.1 cheque there was a sufficient amount in her account to honour the cheque. Hence, even though the cheque in question was dishonored for payment stopped by drawer it attracts, section 138 of NI Act as held by the Hon'ble Supreme Court in Lakshmi Dyechem Vs. State of Gujarath and others, reported in (2012)13 SCC 375. The accused has neither stepped into witness box nor brought on record any circumstances to rebut the presumption envisaged under section 118 and 139 of NI Act. The said statutory presumption remained unrebutted.
14Crl.A.No.1346/2022
22. During the cross examination of PW1, the defence counsel suggested that the demand notice sent to the accused was not served on her. It is also suggested knowingly very well that the accused was not residing in the said address he has issued notice on the said address. The said suggestions have been denied by the complainant in clear terms. Regarding compliance under section 138(b) of NI Act, the complainant has produced Ex.P.3 copy of the demand notice, Ex.P.4 postal receipts, Ex.P.5 unserved postal cover and Ex.P.6 postal track consignment. On perusal of these documents it appears, that after dishonour of cheques, the complainant has sent demand notice as per Ex.P3 on two addresses of accused through registered post acknowledgment due. The notice sent to the one address of the accused returned unserved as Ex.P.5 with postal endorsement addressee left. But as per Ex.P.6 postal track consignment the notice sent to the accused on her another address was duly served on 17.9.2019.
23. The learned counsel for the accused argued that no notice has been served to accused and he submits that Ex.P.6 postal track consignment can't be taken into consideration for proof of service of notice as same was is not accompanied certificate section 65B of Evidence Act. In K. Bhaskaran Vs Sankaran Vaidhyan Balan & Anr [1999 (7) SCC 510], it has been held that the context of Section 138(b) of the Negotiable Instruments Act invites a liberal interpretation favouring the person who has the statutory obligation to give notice under the Act because he must be presumed to be the 15 Crl.A.No.1346/2022 loser in the transaction and provision itself has been made in his interest and if a strict interpretation is asked for that would give a handle to the trickster cheque drawer. It is also well settled that once notice has been sent by registered post with acknowledgment due in a correct address, it must be presumed that the service has been made effective. We do not find from the endorsement of the postal peon that the postal peon was at all examined. In V. Raja Kumari Vs. P. Subbarama Naidu & Anr [2004 (8) SCC 774], Hon'ble Supreme court reiterated that statutory notice under section 138 and 142 of the Negotiable Instruments Act, 1881 sent to the correct address of the drawer but returning with the endorsement must be presumed to be served to the drawer and the burden to show that the accused drawee had managed to get an incorrect postal endorsement letter on the complainant and affixed thereof have to be considered on the background facts of the case.
24. In Madhu Vs Omega Pipes Ltd. [1994 (1) ALT (Crl) 603 (Kerala)] the scope and ambit of Section 138 clauses (b) and (c) of the Act were noted by the Hon'ble Kerala High Court and Justice K.T. Thomas (as His Lordship was then) observed as follows: "In Clause (c) of the proviso the drawer of the cheque is given fifteen days from the date 'of receipt of said notice' for making payment. This affords clear indication that 'giving notice' in the context is not the same as receipt of notice. Giving is the process of which receipt is the accomplishment. The payee has to perform the former process by sending the notice to the drawer in his correct address, if receipt 16 Crl.A.No.1346/2022 or even tender of notice is indispensable for giving the notice in the context envisaged in Clause (b) an evader would successfully keep the postal article at bay at least till the period of fifteen days expires. Law shall not help the wrong doer to take advantage of his tactics. Hence the realistic interpretation for the expression 'giving notice' in the present context is that, if the payee has dispatched notice in the correct address of drawer reasonably ahead of the expiry of fifteen days, it can be regarded that he made the demand by giving notice within the statutory period. Any other interpretation is likely to frustrate the purpose for providing such a notice." Therefore from the above proposition of law it is trite that once notice has been sent by registered post with acknowledgment due in a correct address of the accused is sufficient compliance of section 138(b) of NI Act. In the instance case though the accused contended that notice has been served on him and he was not residing in the address mentioned in Ex.P3 notice, but he has not produced any document to show his exact address as on the date of notice. Hence version of the complainant that he has sent notice on the correct address of the accused has to be accepted. Therefore, the complainant has complied section 138(b) of NI Act by issuing demand notice to the accused through registered post acknowledgment due to the correct address of the accused.
25. There are sufficient material on record to prove the case of the complainant. The trial court by considering the documentary and oral evidence adduced on behalf of the complainant has rightly 17 Crl.A.No.1346/2022 and judiciously come to the conclusion that the accused has committed the offence punishable u/s 138 of NI Act. The reasons assigned by the trial court to arrive such conclusion is also proper and judicious. The trial court has rightly applied the presumption u/s 118 and sec.139 of NI Act to the facts and circumstances of the case. The trial court has rightly convicted the accused for the offence punishable u/s 138 of NI Act. As such, this court do not find any merits in any of the grounds urged in the memorandum of appeal and on the said grounds, the impugned judgment of conviction and sentence cannot be set-aside. The impugned judgment of conviction passed by the trial court is deserves to be confirmed.
26. In view of the aforesaid principles discussed in aforesaid authorities and in view of the reasons assigned by the trial court and in view of the aforesaid reasons, this court feels that the judgment passed by the trial court is just and proper which need not requires the interference of this court. As such, this court is of the opinion that the impugned judgment of the trial court is deserves to be confirmed and appeal filed by the appellant is deserves to be dismissed. Accordingly , this court answers Point No.1 in the Affirmative and Point No.2 in the Negative.
27. Point No.3:- In view of the findings on point No.1, 2 and 3, this court proceeds to pass the following:
18Crl.A.No.1346/2022 ORDER The Appeal filed by the appellant u/s.374(3) of Cr.P.C., is hereby dismissed.
The judgment of conviction and sentence passed by learned XVIII Addl. Chief Metropolitan Magistrate, Bengaluru dated 15.09.2022 in C.C.No.28454/2019 is hereby confirmed.
Send back the Trial court records along with copy of this judgment.
************* (Dictated to the Stenographer, directly on computer, corrected and then pronounced by me in the open court on this the 1 st day of August , 2024).
(SRI. GANGAPPA IRAPPA PATIL ) LII Addl. City Civil & Sessions Judge, Bengaluru.
19 Crl.A.No.1346/2022 20 Crl.A.No.1346/2022 Judgment pronounced in the open court (vide separate Judgment ) ORDER The Appeal filed by the appellant u/s. 374(3) of Cr.P.C., is hereby dismissed.
21 Crl.A.No.1346/2022 The judgment of conviction and sentence passed by learned XVIII Addl.
Chief Metropolitan Magistrate, Bengaluru dated 15.09.2022 in C.C.No.28454/2019 is hereby confirmed.
Send back the Trial court records along with copy of this judgment.
LII Addl. City Civil & Sessions Judge, Bengaluru.