Bangalore District Court
Smt. Rathnamma vs Smt.Bhagyamma on 5 March, 2021
IN THE COURT OF XX ADDL.CHIEF METROPOLITAN
MAGISTRATE AT BENGALURU CITY
Dated this the 5th day of March 2021
PRESENT: KALPANA.M.S.,
B.Sc., LL.M.,
XX ADDL. C.M.M.
Bengaluru.
C.C.No.16120/2018
Complainant : Smt. Rathnamma,
W/o Sri.Yogananda Murthy,
Major,
R/at No.150,
"Krishna Nilaya",
9th Cross, Kirlosakar Layout,
Nagasandra Post,
Bengaluru- 560 073.
{ By Sri. A.T.Jayaraja- Advocate }
Vs.
Accused : Smt.Bhagyamma,
W/o Sri.Krishna,
Aged about 38 years,
R/at No.86, 11th Cross,
Bagalagunte,
Near Dhanush Condiments,
Nagasandra Post,
Hesaraghatta Main Road,
Bengaluru- 560 073.
{ By Sri.A.B.Narayanaswamy - Advocate }
2 C.C.16120/2018
Offence complained of : U/S. 138 of N.I. Act.,
Plea of accused : Pleaded not guilty
Final Order : Accused is Convicted
Date of Order : 05-03-2021
JUDGMENT
The complainant has filed this complaint under section 200 of code of criminal procedure read with section 138 of the Negotiable Instruments Act ( in short referred as "N.I. Act") against the accused alleging that, she has committed the offence.
02. The sum and substance of the complaint, is as follows;
The complainant and the accused were family friends and well known to each other. On 15.09.2017, the accused had availed hand loan of Rs.3,00,000/- from the 3 C.C.16120/2018 complainant for her legal and family necessities and agreed to repay the same within six months. Accused has not kept her promise. On consistent demands, towards discharge of her liability, accused has issued a post dated cheque bearing No. 776651 dated 04.04.2018 for Rs.3,00,000/-, drawn on Karnataka Bank, Hesaraghatta Main Road, Bengaluru.- 560 073. Complainant presented the said cheque for encashment through her banker i.e., Karnataka Bank Hesaraghatta Main Road Branch, Bengaluru and the said cheque returned with an endorsement "Funds Insufficient", dated 04.04.2018. Thereafter, complainant got issued legal notice on 23.04.2018 to accused. The notice was duly served to the accused on 26.04.2018. Accused neither replied nor complied the notice. It is contended that, accused intentionally not maintained sufficient amount in her bank account to honour the cheque issued in favour of the complainant towards discharge of legally enforceable debt. On these allegations, present complaint is filed. 4 C.C.16120/2018
03. After filing of complaint, this court perused the documents and taken cognizance for the offence under section 138 of Negotiable Instrument Act, sworn statement of complainant was recorded. Being satisfied that there are prima-facie materials to proceed against accused, summons was issued. After appearance, accused enlarged on bail and plea was recorded as per section 251 of Cr.P.C. Accused has not stated the defence.
04. Learned Counsel for complainant prays to treat sworn statement as examination-in-chief and to consider the documents marked as Ex.P.1 to 5. Further, complainant got marked one document i.e., Ex.P.6 through confrontation in the course of cross examination of the accused. The statement under section 313 of code of criminal procedure is recorded, read over and explained to the accused. Accused denied the incriminating circumstances and putfoth the defence that, in a chit transaction she had given 10 cheques to the complainant and her son. She has 5 C.C.16120/2018 not availed Rs.3,00,000/- from the complainant. Further, accused examined herself as DW.1 and got marked one document as per Ex.D.1.
05. Complainant relied on the following citations;
1. 2015(4) KCCR 2881 (SC) T.Vasanthkumar Vs. Vijayakumari
2. 2016(3) SCC 1 Don Ayengia Vs. State of Assam and Another 3.2004(3) KCCR 1816 L.Mohan Vs. Mohan Naidu 4.2017(4) AKR 261 Shashidar Rai Vs. Dr. Jossie Pereira 5.2001Crl.L.J.4647 Hiten P.Dalal Vs. Bratindranath Banerjee
6.ILR 2001 KAR 4127 S.R.Muralidar Vs. Ashok.G.Y. 7.2006 Crl.L.J 1 Gorantala Venkateswara Rao Vs. Kolla Veera Raghava Rao and Anr.
6 C.C.16120/2018
06. Heard the Learned Counsel for complainant and accused. Perused citations and materials on record.
07. The points that arise for my consideration are as follows;
POINTS
1. Whether the complainant proves that, accused issued a cheque bearing No. 776651 dated 04.04.2018 for Rs.3,00,000/-, towards discharge of her liability, which was returned unpaid on presentation and also not complied the notice issued by the complainant and thereby committed an offence punishable under section 138 of Negotiable Instruments Act?
2. What Order?
08. My answer to the above points is as follows;
1. Point No.1: In the Affirmative
2. Point No.2: As per final order for the following;
7 C.C.16120/2018REASONS
09. POINT No.1: Complainant has filed this complaint alleging that accused has committed offence under section 138 of N.I. Act. She pleads and asserts that, towards discharge of her liability, accused has issued a post dated cheque bearing No. 776651 dated 04.04.2018 for Rs.3,00,000/-. The said cheque came to be dishonoured on presentation. Complainant has issued notice within time stipulated calling upon the accused to pay the amount covered under cheque. Inspite of service of notice, accused has not paid the amount within 15 days, which gave raise cause of action to file this complaint. She further relied on the documents from Ex.P.1 to 6. This witness was subjected to cross examination.
10. In this scenario, let us scrutinize 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 04.04.2018, the said cheque 8 C.C.16120/2018 returned with an endorsement "Funds Insufficient", Ex.P.1(a) is the signature of the accused, Ex.P.2 is bank endorsement dated 04.04.2018, Ex.P.3 is legal notice dated 23.04.2018, said notice duly served on the accused on 26.04.2018, Ex.P.4 is postal receipt, Ex.P.5 is the Postal acknowledgement and Ex.P.6 is the statement before Assistant Commissioner of Police, Yeshavanthapura, Bengaluru. This complaint came to be filed on 05.06.2018. A careful scrutiny of the documents relied by the complainant goes to show that, statutory requirements of section 138 of N.I. Act is complied with and this complaint is filed within time. Thus, complainant relied on the statutory presumptions enshrined under section 118 read with section 139 of N.I. Act.
11. No doubt, the said presumptions of law are rebuttable in nature. The accused can take probable defence and rebut the presumption available to the complainant. Let us examine whether accused has successfully rebutted the 9 C.C.16120/2018 presumptions of law. The accused denied the impugned transaction. It is the specific defence of the accused that, she was the subscriber of the chit business run by the complainant. While taking prize amount, complainant has demanded and received signed blank cheque as security towards payment of remaining chit installments. Accused has not able to pay Rs.32,000/- chit amount. Son of the complainant made galata near house of the accused, which prompted her to lodge complaint before Assistant Commissioner of Police, Yeshavanthapura, Bengaluru, as per Ex.D.1. Police have enquired the complainant and her son and directed the accused to pay the chit amount within three months. Accordingly, son of the accused by name Shashi Kiran has collected the balance chit amount. At that time, accused demanded for return of disputed cheque issued towards security, for which said Shashi Kiran demanded interest at the rate of 10% to get back the documents. Accused is not liable to pay any amount to the complainant. She has not taken hand loan of Rs.3,00,000/- 10 C.C.16120/2018 from the complainant on 15.09.2017. Complainant misused the security cheque and filed this false complaint. On these contentions, accused sought for dismissal of the complaint and consequent acquittal. To endorse this contention, accused examined herself as DW.1 and relied on the Ex.D.1 document i.e., complaint before Assistant Commissioner of Police, Yeshwanthpur Sub- Division, Bengaluru.
12. In the back drop of the rival contentions, this court has given anxious consideration to the case papers. At the outset, accused has admitted in her evidence that, the cheque in question belongs to her and it bears her signature. For better appreciation the relevant portion of cross examination of DW.1 is culled out as under;
"ವವದತ ಚಕಕನಲ ನನನ ಸಹ ಇದ. ಸದರ ಚಕಕ ಕ ನನನ ಬಬಬಕ ಖತಗ ಸಬಬಬಧಸದ. "11 C.C.16120/2018
From this part of evidence, it goes without saying that, accused has not disputed the cheque in question. When the drawer has admitted the issuance of the cheque as well as the signature present therein, the presumptions envisaged under section 118 read with section 139 of NI Act, would operate in favour of the Complainant. The said provisions lays down a special rule of evidence applicable to negotiable instruments. The presumption is one of law and thereunder court shall presume that the instrument was endorsed for consideration. So also, in the absence of contrary evidence on behalf of the accused, the presumption under section 118 of the NI Act, goes in favour of the complainant.
13. This proposition of law is laid down by the Hon'ble High Court of Karnataka in the decision reported in ILR 2006 KAR 4672 - J.Ramaraj V/s Iliyaz Khan, wherein it is held that;
"Mere denial of issuing cheque would not be sufficient as it is time and again noted that once the cheque is issued duly signed by the petitioner, 12 C.C.16120/2018 the presumption goes against him as per Sec.139 of the Negotiable Instruments Act."
No doubt, said statutory presumptions are rebuttable in nature. It is for the accused to place cogent and probable defence to rebut the presumptions raised in favour of the Complainant.
14. Perused the case papers. Learned counsel appearing for the complainant vehemently argued that, the admission of issuance of the cheque and the signature present present therein entitles the complainant for the statutory presumptions. Apart from that, complainant has placed oral testimony by way of affidavit supported with the material documents such as, cheque, return memo, legal notice and postal acknowledgement. Accused is not successful in eliciting material admissions in the evidence of PW.1 to disbelieve the case of the complainant. She has also not disputed the financial capacity of the complainant 13 C.C.16120/2018 to lend the amount in question. In turn, the admitted document as per Ex.P.6 clearly discloses that, accused has un-equivocally admitted her liability before the Assistant Commissioner of Police, Yeshwanthpur Sub- Division, Bengaluru, and gave the statement. To avoid penal liability , accused has filed false complaint as per Ex.D.1 before Assistant Commissioner of Police, Yeshwanthpur Sub- Division, Bengaluru, which is countered by the Ex.P.6- statement, which was recorded by the police after enquiry. The accused has not placed any documents to show the chit transaction. It is further argued that, as per evidence of the accused , monthly income of the accused is Rs.10,000/-. No documents are produced to show the income of husband or son. Such being the case, it is far from the truth to believe that, accused was paying Rs.30,000/- per month chit installment. This itself shows that, accused has come with with false and concocted story to avoid the penal liability. On this line of arguments, it is sought for conviction and appropriate compensation. 14 C.C.16120/2018
15. On the other hand, Learned counsel for the accused strenuously argued that, it is evident from the evidence of complainant that, her monthly income is Rs.10,000/- to Rs.15,000/-. It is un- believable that, out of this income she saved Rs.3,00,000/-. Further, if at all she was having Rs.3,00,000/- amount, she could have paid the amount immediately on the date when the accused approached on 01.08.2017 or 15.09.2017 or after one week when the accused approached her in the second time. Further, no supportive documents are produced to prove the impugned transaction. No prudent man will lend Rs.3,00,000/- amount without obtaining the necessary documents. Moreover, the police complaint as per Ex.D.1 clearly shows that, there was only chit transaction taken place between the parties. Later on, police colluded with the complainant and recorded false statement as per Ex.P.6, which is not admissible in law and it is created documents to suit the claim of the complainant. On this line of arguments, it is impressed that, accused deserves acquittal. 15 C.C.16120/2018
16. It is evident from the documents placed by the complainant particularly Ex.P.6 that, there was money transaction between the complainant and accused. In pursuance of the statement given by the accused before the police on 06.12.2017, cheque dated on 04.04.2018 was issued in favour of the complainant. No doubt, accused seriously disputes Ex.P.6 on the contention that, it is concocted document by colluding with the police, as its contents goes contrary to the averments of the complaint lodged by the accused as per Ex.D.1. However, it is forthcoming from the cross examination of DW.1- accused that, the contents of Ex.P.6 was read over to the witness and she un-equivocally admitted the statement where under she agreed to pay the amount to the complainant within three months from 06.12.2017. For better appreciation, the relevant portion of the evidence/ cross examination of the accused is culled out as under;
" ಈಗ ನನನಡದ ದನಬಕ 06.12.2017 ರ ಹನಳಕಯಲ ಕನನಡ ಮತಕತ ಇಬಗಗನಷನಲ ನನನ ಸಹಗಳಕ ಇದ. ಸದರ ದಖಲಯನಕ ನ ಸಕ ಒಪಪರಕವದರಬದ ನಪ.6 ಎಬದಕ ಗಕರಕತಸಲಯತಕ. ನಪ.6 ದಖಲಯನಕ ನ ಯಶವಬತಪರ ಪನಲನಸ ಕಮಷನರ ಕಛನರಯಲ 16 C.C.16120/2018 ನ 3 ತಬಗಳನಳಗ ಬರದಕ ದನರಕದರರಗ ರನ.2,95,000/- ಹಣವನಕ ಕನಟಟದನ ಎಬದರ ಸರ."
From this part of evidence, it is crystal clear that, accused has admitted the liability. If at all, the said document is concocted as alleged, the accused would not admit the contents when read over and could have not admitted the document - Ex.P.6, which was admittedly marked through confrontation. Therefore, this contention of the accused does not inspire the confidence of the court.
17. Nevertheless, accused has taken specific contention that, cheque in question was issued for security towards payment of the chit installments. In otherwords, complainant was running the chit business. This aspect is denied by the complainant. Thus, the burden is on the accused to prove the alleged chit business of the complainant. Section 106 of Indian Evidence Act, provides that, 'the burden is on the accused to establish the fact within his specific knowledge'. Except self serving statement, accused has not placed iota of evidence to show 17 C.C.16120/2018 the alleged chit business of the complainant. That apart, accused has not also not chosen to examine any other subscribers of the chit or to produce chit documents. Even if it is believed that, cheque was issued as security to the chit transaction, what prevented the accused to take suitable legal action to recover the security cheque after payment of the chit installments, is not satisfactorily explained. Even otherwise, what prevented her to issue intimation to her banker to stop payment of alleged cheque issued towards security, is also not explained. This inaction attributable to the accused rises genuine doubt about the defence.
18. In this context, it is profitable to refer the decisions reported in, AIR 2018 SUPREME COURT 3601, in a case of, T.P.Murugan (Dead) Thr.Lrs. V. Bojan, wherein it is held that;
" Negotiable Instruments Act (26 of 1881), Ss.118,138,139- Dishonour of cheque- Presumption as to enforceable debt- cheques 18 C.C.16120/2018 allegedly issued by accused towards repayment of debt- Defence of accused that 10 cheques issued towards repayment of loan back in 1995- Behavior of accused in allegedly issuing 10 blank cheques back in 1995 and never asking their return for 7 years, unnatural- Accused admitting his signature on cheques and pronote, presumption under S.139 would operate against him- Complainant proving existence of legally enforceable debt and issuance of cheques towards discharge of such debt- Conviction, proper".
The another decision reported in , 2015(8) SCC 378; T.Vasanthakumar Vs. Vijayakumari, it is held that;
" Negotiable Instruments Act, (26 of 1991- S.138 and 139- Dishonour of Cheque- Appeal against acquittal- Cheque as well as signature on it not disputed by the accused, respondent- presumption under section 139 would be attracted- story brought out by accused that cheque was given to complainant long back to 1999 as a security to a loan : the loan was repaid but complainant did not return security cheque- Is unworthy of credit, apart from being unsupported by way evidence - mere printed date on cheque by itself cannot be conclusive of fact that cheque was issued in 1999- order of high court in acquitting accused is erroneous and set aside civil rev. petition No.263 of 2011, dated 22.07.2011 (kar)."19 C.C.16120/2018
Similar to the facts and circumstances of the cited decisions, in the present case also the accused is not disputing the issuance of the Ex.P.1 cheque and signature present on it. The defence that, said cheque was issued in favour of complainant as security, is not supported by any evidence.
19. Further, in the course of arguments, the financial capacity of the complainant to lend the claimed amount is disputed. It is worth to note that, no positive suggestions posed to the complainant disputing her financial capacity to lend the cheque amount. That apart, Ex.P.6 clearly establishes the liability of the accused to repay the loan amount to the complainant. Therefore, this contention taken by the accused for the first time in the arguments is lack of merits.
20 C.C.16120/2018
20. The Hon'ble Supreme Court of India pleased to discuss aforesaid aspect in detail in the decision reported in, Rangappa Vs. Mohan reported in AIR 2010 SC 1898 = 2010 AIR (SCW) 2946, It is relevant to reproduce said observations;
" Once the cheque relates to the account of the accused and he accepts and admits the signatures on the said cheque, then initial presumption as contemplated under Section 139 of the Negotiable Instruments Act has to be raised by the court in favour of the complainant. The presumption referred to in Section 139 of the NI Act is a mandatory presumption and not a general presumption, but the accused is entitled to rebut the said presumption.
What is required to be established by the accused in order to rebut the presumption is different from each case under the given circumstances. But the fact remains that a mere plausible explanation is not expected from the accused and it must be more than a plausible explanation by way of rebuttal evidence. In other words, the defence raised by way of rebuttal evidence must be probable and capable of being accepted by the court.
The defence raised by the accused was that a blank cheque was lost by him, which was made use of by the complainant. Unless 21 C.C.16120/2018 this barrier is crossed by the accused, the other defence raised by him whether the cheque was issued towards the hand loan or towards the amount spent by the complainant need not be considered......"
Hence, the High Court concluded that the alleged discrepancies on part of the complainant which had been noted by the trial court were not material since the accused had failed to raise a probable defence to rebut the presumption placed on him by Section 139 of the Act. Accordingly, the Hon'ble High Court recorded a finding of conviction.
It is further observed in para 18 of the decision that, Ordinarily in cheque bouncing cases, what the courts have to consider is whether the ingredients of the offence enumerated in Section 138 of the Act have been met and if so, whether the accused was able to rebut the statutory presumptions contemplated by Section 139 of the Act.
" Chapter XVII containing Sections 138 to 142 was introduced in the Act by Act 66 of 1988 with the object of inculcating faith in the efficacy of banking operations and giving credibility to negotiable instruments in business transactions. These provisions were intended to discourage people from not honouring their commitments by way of 22 C.C.16120/2018 payment through cheques. The court should lean in favour of an interpretation .........
In view of Section 139, it has to be presumed that a cheque is issued in discharge of any debt or other liability. The presumption can be rebutted by adducing evidence and the burden of proof is on the person who wants to rebut the presumption.
A contrary view would render S.138 a dead letter and will provide a handle to persons trying to avoid payment under legal obligations undertaken by them through their own acts which in other words can be said to be taking advantage of one's own wrong. ..."
The Hon'ble Apex court clearly laid down the ratio that, when the ingredients of section 138 of NI Act is complied with, presumption shall be drawn in favour of the complainant. The burden is upon the accused to rebut the statutory presumptions.
21. As far as proof of existence of legally enforceable debt is concerned, it is profitable to refer the observations of Rangappa's case cited supra;
"In the light of these extracts, we are in agreement with the respondent-23 C.C.16120/2018
claimant that the presumption mandated by section 139 of the Act does indeed include the existence of the legally enforceable debt or liability".
In view of the law laid by three judges bench of Hon'ble Apex Court, the presumption enshrined under section 139 of the N.I. Act is expendable to the existence of legally enforceable debt. Accused has not placed cogent material to rebut the said presumption.
22. Further, it is profitable to refer the authorities reported in, AIR 2019 Supreme Court 2446 in Criminal Appeal Nos. 230-231 of 2019, D/- 06.02.2019, Bir Singh Vs. Mukesh Kumar, it is held that;
"(C) Negotiable Instruments Act (26 of 1881), S.138, S.139- Evidence Act (1 of 1872), S.4-
Presumption u/S. 139- Is presumption of law, distinguished from presumption of facts- Presumptions are rules of evidence and do not conflict with presumption of innocence, which requires prosecution to prove case against accused- Obligation on prosecution may be discharged with help of 24 C.C.16120/2018 presumptions of law and presumptions of fact unless accused adduces evidence showing reasonable possibility of non- existence of presumed fact.
(E) Negotiable Instruments Act (26 of 1881), S.138, S.139- Dishonour of cheque-
Presumption as to legally enforceable debt- Rebuttal- Onus to rebut presumption that cheque issued in discharge of debt or liability is on accused. "
In the decision reported in, AIR 2019 SUPREME COURT 1876, Rohitbhai Jivanlal Patel Vs. State of Gujarat and Another; wherein it is held that;
" (D) Negotiable Instruments Act (26 of 1881), S.138, S.139 - Dishonour of cheque-
Principles of presumption - Once
presumption of existence of legally
enforceable debt drawn in favour of complainant, onus is shifted on accused-
Unless onus is discharged by accused that preponderance of probabilities are tilting in his favour, doubt on case of complainant cannot be raised for want of evidence regarding source of funds for advancing loan to accused."
25 C.C.16120/2018
In view of the law laid down in the aforesaid Rangappa's case and Bir Singh's case, the claim of the complainant is acceptable.
23. From the overall consideration of the evidence on record it is forthcoming that, accused has not taken probable defence to rebut the statutory presumption. Mere denial is not sufficient to discharge the onus shifted on accused. To fortify this opinion, it is proper to refer the decision reported in, 2001 CRI.L.J. 4647, in a case of Hiten P.Dalal V/s. Bratindranath Banerjee, wherein it is held that;
"(B) Negotiable Instrument Act ( 26 of 1881), Ss.139, 138- Dishonour of cheque- Presumption that cheque was drawn for discharge of liability of drawer- Is presumption of law- Ought to be raised by Court in every case-
Rebuttal evidence- Nature- Mere plausible explanation is not sufficient- Proof of explanation is necessary.
Evidence Act (1 of 1872), Ss .114, 101- 104."
26 C.C.16120/2018Further, in another decision reported in, 2017(2) A.K.R. 527, Arjun Vs.E.Shekar, it is held that, S. 138, 139- Presentation of lawful consideration- Rebuttal of - Burden of proving that cheque has not been issued for any debt or liability - is on accused - mere plausible explanation not sufficient to disprove complainant' s case.
From the gist of the ratio laid down in the above decisions, it is clear that, burden shift on the accused to rebut the statutory presumption through cogent evidence, which is not discharged by the accused in the present case.
24. Under the facts and circumstances of this case, it is profitable to refer the decision in, AIR 2018 Supreme Court 3604, in a case of Krishna Rao Vs. Shankargouda, wherein it is held that;
"Negotiable Instruments Act (26 of 1881), Ss.138, 139-Dishonour of cheque- Presumption as to - Accused issuing cheque of Rs. 2 lacs towards repayment of loan to complainant - Said cheque dishonored on account of insufficiency 27 C.C.16120/2018 funds- Complainant proving issuance of cheque having signatures of accused- Accused failing to rebut presumption raised against him and no evidence led by him in his support -Acquittal of accused by High Court in revisional jurisdiction on ground of doubt in mind of court with regard to existence of loan, improper- Accused, liable to be convicted".
25. Moreover, in the latest judgment decided on 15 th March 2019, the Hon'ble Supreme Court of India, AIR 2019 Supreme Court 1876; Rohitbhai Jivanlal Patel V/s State of Gujarat & Another, it is observed in para 12 that;
" 12. For determination of the point as to whether the High Court was justified in reversing the judgment and order of the Trial Court and convicting the appellant for the offence under section 138 of the NI Act, the basic questions to be addressed to are two - fold: as to whether the complainant - respondent No.2 had established the ingredients of Sections 118 and 139 of the NI Act, so as to justify drawing of the presumption envisaged therein; and if so, as to whether the accused -appellant had been able to displace such presumption and to establish a probable defence whereby, the 28 C.C.16120/2018 onus would again shift to the complainant?........"
It is further observed in 18.6 that;
" 18.6. The fact of the matter remains that the appellant could not deny his signatures on the said writing but attempted to suggest that his signatures were available on the blank stamp paper with Shri Jagdishbhai. This suggestion is too remote and too uncertain to be accepted. No cogent reason is available for the appellant signing a blank stamp paper. It is also indisputable that the cheques as mentioned therein with all the relevant particulars like cheque numbers, name of bank and account number are of the same cheques which form the subject matter of these complaint cases. The said document bears the date 21.03.2007 and he cheques were postdated, starting from 01.04.2008 and ending 01.12.2008. There appears absolutely no reason to discard this writing from consideration...."
It is further observed in para No.19 that;
" 19. Hereinabove, we have examined in detail the findings of the Trial Court and those of High Court and have no hesitation in concluding that the present one was clearly a case where the decision of the Trial Court suffered from perversity and fundamental error of approach; and the High Court was justified in reversing the 29 C.C.16120/2018 judgment of the Trial Court. The observations of the Trial Court that there was no documentary evidence to show the source of funds with the respondent to advance the loan, or that the respondent did not record the transaction in the form of receipt of even kachcha notes, or that there were inconsistencies in the statement of the complainant and his witness, or that the witness of the complaint was more in know of facts etc. would have been relevant if the matter was to be examined with reference to the onus on the complaint to prove his case beyond reasonable doubt. These considerations and observations do not stand in conformity with the presumption existing in favour of the complainant by virtue of Sections 118 and 139 of the NI Act. Needless to reiterate that the result of such presumption is that existence of a legally enforceable debt is to be presumed in favour of the complainant. When such a presumption is drawn, the factors relating to the want of documentary evidence in the form of receipts or accounts or want of evidence as regards source of funds were not of relevant consideration while examining if the accused has been able to rebut the presumption or not. The other observations as regards any variance in the statement of complainant and witness; or want of knowledge about dates and other particulars of the cheques; or washing away of the earlier cheques in the rains though the office of the complainant being on the 8th floor had also been or 30 C.C.16120/2018 irrelevant factors of consideration of a probable defence of the appellant....."
The ratio laid down in the cited decisions are aptly applicable to the case on hand.
26. The accused has taken a vague defence and not placed cogent evidence to prove the same. This aspect is discussed in detail in a decision reported in , 2014(4) AKR 98 between Sripad Vs.Ramadas M.Shet, Criminal Appeal No.2689 of 2009, wherein it is held that;
"Negotiable Instrument Act (26 of 1881), Ss.138,139, 118- Dishonour of cheque-Acquitted-Validity-Cheque issued by repay loan amount to complainant, was dishonoured-
Specific defence -However, accused failed to rebut initial presumption under sections 118 and 119- Mere distorted version or mere taking up defence by It means that he is not liable to pay any amount- Are not sufficient to put back the burden on to the complainant- Acquittal of accused- Not proper."
The ratio laid down in the cited decision is squarely applicable to the facts on hand.
31 C.C.16120/2018
27. In this case plea of the accused was recorded as per section 251 of Cr.P.C. Accused pleaded not guilty. As per section 251 of Cr.P.C. accused has to state about his defence. Here, except pleading not guilty accused has not stated his defence at the time of recording plea. As per the decision reported in AIR 2014 SC 2528 (Indian Bank Association V/s Union of India), Crl. Petition No.8943/2010 M/s.Mess Transgare Pvt V/s Dr .R. Parvathareddy and in Rajesh Agarwals case, Wherein, it is held that; " Accused cannot simply say " I am innocent " or " I pleaded not guilty ". The proposition of law laid down in the aforesaid decision is squarely applicable to the facts and circumstances of this case. As such, it cannot be taken that accused has rebutted the presumption of law enshrined under section 139 and 118 of N.I. Act, by mere pleading not guilty.
28. From the discussion made supra, it is clear that, accused has neither taken probable defence nor taken steps 32 C.C.16120/2018 to prove the same. To put it other way, accused has not taken and proved probable defence to rebut the presumption of law available in favour of the complainant, envisaged under section 118 read with section 139 of N.I. Act. Accordingly, the case of the complainant is believable. Complainant has proved that, accused has intentionally not maintained sufficient amount in his account to honour the disputed cheque. Hence, this point No.1 under consideration is answered in the affirmative.
29. POINT NO.2: In view of the reasons stated and discussed above, the complainant has proved the guilt of the accused punishable under section 138 of N.I. Act It is worth to note that, the offence is of the nature of civil wrong. Hence, it is proper to award sentence of fine, instead of awarding sentence of imprisonment. Hon'ble Supreme Court of India in a decision reported in, (2015) 17 SCC 368, in a case of H.Pukhraj Vs. D.Parasmal, observed that, having regard to the length of trial and date 33 C.C.16120/2018 of issuance of the cheque, it is necessary to award reasonable interest on the cheque amount along with cost of litigation. The amount covered under the disputed cheque is Rs.3,00,000/-. The date of cheque is 04.04.2018. It is pertinent to note that, RBI monitory policy statement of the year 2017-2018 dated 02.08.2017 provides that, the prevailing bank rate of interest was 6.25%. By considering all these aspects, this court is of the opinion that, it is just and proper to imposed fine amount of Rs.3,75,000/-, which includes interest and cost of litigation, out of which compensation has to be awarded to the complainant. Accordingly, this court proceed to pass the following;
ORDER Acting under section 255 (2) of Criminal Procedure Code, accused is hereby convicted for the offence punishable under section 138 of Negotiable Instrument Act and sentenced to pay fine of Rs.3,75,000/- 34 C.C.16120/2018
( Rupees Three Lakhs Seventy Five
Thousand only). In default thereof
accused shall undergo simple
imprisonment for 1 (One) month.
Acting under section 357(1) (b) of
code of criminal procedure, it is
ordered that, Rs.3,70,000/- ( Rupees Three Lakhs Seventy Thousand only), there from shall be paid to the complainant as a compensation, remaining fine amount of Rs.5,000/-
( Rupees Five Thousand only) is defrayed to the state for the expenses incurred in the prosecution.
The bail bond of the accused stands canceled after expiry of six months.
35 C.C.16120/2018
Office to supply the copy of this Judgment to the accused immediately on free of cost.
{Dictated to the stenographer directly on computer, corrected and then signed by me and then pronounced in the open court on this 5th day of March 2021}.
(KALPANA.M.S.) XX ACMM, Bengaluru.
ANNEXURE List of witnesses examined on behalf of complainant:
P.W.1 Smt. Rathnamma, List of documents produced on behalf of complainant:
Ex.P.1 Cheque
Ex.P. 1(a) Signature of the accused
Ex.P. 2 Bank endorsement
Ex.P. 3 Copy of the legal notice
Ex.P. 4 Postal receipt
36 C.C.16120/2018
Ex.P. 5 Postal acknowledgement
Ex.P.6 Statement before Assistant
Commissioner of Police,
Yeshavanthapura,
Bengaluru.
List of witnesses examined on behalf of accused:
D.W.1 Smt.Bhagyamma, List of documents produced on behalf of accused:
Ex.D.1 Complaint before Assistant Commissioner of Police, Yeshwanthpur Sub- Division, Bengaluru.
XX A.C.M.M., Bengaluru.