Bangalore District Court
Srinidhi Engineering vs Uday Kumar P on 10 March, 2020
IN THE COURT OF XXI ADDL.CHIEF METROPOLITON
MAGISTRATE, BENGALURU CITY
Present: Sri. V. NAGARAJA, LL.B., LL.M.,
XXI Addl. Chief Metropolitan Magistrate,
Bengaluru.
Dated this the 10th day of March, 2020
C.C. No.2617/2019
COMPLAINANT: SRINIDHI ENGINEERING
No.41, 13th Cross,
Kala Nagara, K.G. Halli,
Jalahalli West,
Bengaluru - 560 015.
Represented by its Proprietor
Suresh
S/o. Venkateshwarulu
(Reptd. By: NV., Advocate)
V/s.
ACCUSED: UDAY KUMAR P
Father' name not known to the
complainant,
Aged about 34 years,
Proprietor of
NEXUS Engineer,
No.A-15, 1st Cross,
3rd Stage, Peenya Industrial Estate,
Bengaluru - 560 058.
(Reptd. By: SGB., Advocate)
:JUDGMENT:
Complainant has filed this complaint under Section 200 of Cr.P.C. r/w Section 138 of N.I. Act, seeking for penalizing the accused for the offence punishable under 2 C.C.No.2617/2019 Section 138 of N.I. Act and also for awarding compensation to him.
2. Case of the complainant in a nutshell is that:
He and accused are well acquainted with each other.
So, in that acquaintance, on 10.06.2018, accused had borrowed hand loan of Rs.49,000/- from him for the purpose of improvement of his business and he assured to repay the same within three months.
3. It is further averred that after obtaining the above loan, the accused had placed order for supplying of core bar. Accordingly, the complainant had supplied ready core bar materials to accused as per bill. So, accused had to pay sum of Rs.48,012/- towards said job work.
4. It is further averred that when complainant demanded for repayment of above said hand loan of Rs.49,000/- and job work due amount of Rs.48,012/-, the accused in order to discharge above said liabilities, he has issued two postdated cheques i.e., cheque bearing No.620598 dated 17.08.2018 for Rs.48,012/- drawn on State Bank of India, SME Branch, Peenya II Stage, Bengaluru and another cheque bearing No.187260 dated 3 C.C.No.2617/2019 14.09.2018 for Rs.49,000/- drawn on State Bank of India, PBB, Koramangala Branch, Bengaluru and assured to honour the said cheques. So, believing the words of the accused, he presented the above said cheques through his banker i.e., Axis Bank, J.C. Road Branch, Bengaluru. But both cheques were dishonoured that is to say cheque bearing No.620598 was dishonoured for the reason of "Payment Stopped by Drawer" and another cheque bearing No.187260 was dishonoured for the reason of "Exceeds Arrangements". So, the bank authorities issued endorsements dated 21.09.2018 and 17.09.2018 respectively. So, he got issued legal notice to accused dated 15.10.2018 through RPAD regarding dishonour of cheques and called upon him to pay cheques amount, whereas said notices have been duly served upon accused on 16.10.2019, but accused failed to pay the cheques amount. Hence, accused has committed offence punishable U/s.138 of NI Act. Hence, he is constrained to file this complaint seeking for penalizing the accused for the offence punishable under Section 138 of N.I. Act., and also seeking for awarding of compensation to him. 4 C.C.No.2617/2019
5. In pursuance of summons issued by this court, accused made appearance through his counsel and obtained bail and now he is on bail.
6. As these proceedings are summary in nature, substance of accusation read over and explained to accused in language known to him whereas, he pleaded not guilty and claimed for trial.
7. In order to prove the case of the complainant, he has been examined as PW-1 and got documents marked Ex.P-1 to Ex.P-12. After completion of evidence of complainant, statement of accused as specified U/s.313 of Cr.P.C., has been recorded and he has been examined as DW-1 and got documents marked Ex.D-1 to Ex.D-35.
8. I have heard arguments of both learned counsels, whereas both learned counsels have also filed their written arguments, whereas learned counsel for accused also filed memo of citations.
9. Perused the records.
10. After perusal of records, the points arise for my consideration are:
5 C.C.No.2617/2019
1) Whether complainant proves beyond all reasonable doubt that accused in order to discharge his legally enforceable debt, he has issued him two postdated cheques i.e., cheque bearing No.620598 dated 17.08.2018 for Rs.48,012/- drawn on State Bank of India, SME Branch, Peenya II Stage, Bengaluru and another cheque bearing No.187260 dated 14.09.2018 for Rs.49,000/-
drawn on State Bank of India, PBB, Koramangala Branch, Bengaluru?
2) Whether complainant further proves that he has complied with mandatory requirements as specified under Section 138 of N.I. Act?
3) What Order?
11. My findings on the above points are:
Point No.1 : In the Affirmative
Point No.2 : In the Affirmative
Point No.3 : As per final order,
for the following:
REASONS
12. Point No.1: As I have already stated, in order to prove the case of the complainant, he has been examined as PW-1 and he filed his examination-in-chief by way of affidavit by reiterating entire complaint averments as stated above. In support of his oral testimony, he relied upon Ex.P-1 to Ex.P-12.
13. On the other hand, accused has been examined as DW-1 and got documents marked Ex.D-1 and Ex.D-35. 6 C.C.No.2617/2019
14. Before appreciation of evidence of both parties, I am of the opinion, it is worth to note presumptions envisaged in N.I. Act as well as ratio laid down by the Hon'ble Apex Court in Three Judges Bench Judgment reported in (2010) 11 SCC 441 (Rangappa V/s. Sri Mohan) wherein it is held:
"The presumption mandated by Section 139 includes a presumption that there exists a legally enforceable debt or liability. This is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, herein, there can be no doubt that there is an initial presumption which favours the respondent /complainant."
It is further held:
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 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.
15. So in the light of above presumptions and ratio decidendi laid down by Hon'ble Apex Court, if the present facts and situations are analyzed, it is obvious that according to complainant, accused has issued cheques for 7 C.C.No.2617/2019 discharging of his liability. On the other hand, on considering the stand taken by the accused, it is obvious that though he disputes his liability as claimed by complainant, but he is not disputing the facts that cheques are belonged to his account and they bear his signatures. So, as I have already stated in view of ratio laid down by Hon'ble Apex court in the Judgments stated supra, that as soon as accused admits the facts that cheques are belonged to his account and they bear his signatures, then the mandatory presumption u/S 139 of N.I. Act comes to the aid of complainant and he can rest upon said presumption.
16. Whereas, learned counsel for defence argued that in order to raise presumption U/s.138 of NI Act, the condition precedent is that complainant must prove the existence of legally recoverable debt or liability, if he is able to prove the same, then only presumption can be raised otherwise not.
17. Having regard to the arguments of learned counsel for accused, it is important to note as I have already pointed out Hon'ble Three-Judges Bench 8 C.C.No.2617/2019 Judgment of Hon'ble Supreme Court in Rangappa's case stated supra, it is clearly held:
"The presumption mandated by Section 139 includes a presumption that there exists a legally recoverable debt or liability"
18. So when above ratio clearly states that presumption includes existence of legally enforceable debt or liability then further proof of that fact is not required that too in summary proceedings. Because Hon'ble Apex Court in the judgment reported in (2009)2 SCC 513 (Kumar Exports V/s. Sharma Carpets) has clearly observed that:
Presumption literally means "taking as true without examination or proof"
19. At this juncture, it is also worth to note ratio laid down by Hon'ble Apex Court in the judgment reported in (2014)5 SCC 590 (Indian Bank Association and others V/s. Union of India and others) wherein it is held by reiterating Section 143 of Negotiable Instruments Act and Section 264 of Cr.P.C., that:
"Section 264, Judgments in cases tried summarily - In every case tried summarily in which the accused does not plead guilty, the 9 C.C.No.2617/2019 Magistrate shall record the substance of the evidence and a judgment containing a brief statement of the reasons for the finding"
"Thus, the Magistrate is not expected to record full evidence which he would have been, otherwise required to record in a regular trial and his judgment should also contain a brief statement of the reasons for the finding and not elaborate reasons which otherwise he would have been required to record in regular trials"
20. So, in the light of above ratio decidendi and in view of Section 143 of Negotiable Instruments Act and Section 264 of Cr.P.C., as this case is summary case, I am of the opinion it is not necessary to discuss elaborately with respect to legally enforceable debt when presumption includes existence of legally recoverable debt as held in the above said judgment of Hon'ble Apex Court. So, the mandatory presumptions will live, exist and survive and shall end only when the contrary is proved by the accused, that is to say the cheque was not issued for consideration and in discharge of any debt or liability, in other words, onus shifts on the accused to rebut the said mandatory presumption raised in favour of complainant as observed 10 C.C.No.2617/2019 by Hon'ble Apex Court in the Judgment reported in (2009)2 SCC 513 (Kumar Exports V/s. Sharma Carpets).
Now the crucial question arises as to whether accused is able to rebut the said presumption or not?
21. It is significant to note on considering the defence of the accused, he contended that accused firm namely NEXUS Engineering has been carrying business by outsourcing job work to others. Accordingly, in the course of their business, they used to entrust job work to complainant. Such being so, during October 2017 to July 2018, accused had entrusted job work to complainant and also supplied raw materials to complainant to execute job work as required by him, whereas after supplying said raw materials by him, the complainant had returned goods with incomplete work. So, the accused returned the materials to complainant for re-work, but still the complainant had not completed the job work as required by the accused. So, once again he returned the materials to complainant, which remains with the complainant himself. It is further contended that at the time of supplying of raw materials, the complainant had obtained his one cheque bearing No.620598 for Rs.48,012/- as 11 C.C.No.2617/2019 advance amount for said job work. But, as the complainant has not completed the said job work as required by accused and accused had returned the materials to complainant, he gave stop payment instructions to his banker to stop payment regarding said cheque. So, his bank authority stopped the payment regarding said cheque. Such being so, when complainant had not executed his job work as required by accused, question of paying Rs.48,012/- does not arise. So, there is no legally enforceable debt.
22. He further contended that he never borrowed Rs.49,000/- from the complainant. So, question of issuing cheque bearing No.187260 for Rs.49,000/- does not arise. In fact, the complainant has misused his cheques in collusion with earlier staff of the accused namely Venkatesh and filed this false complaint only in order to grab money from him. Hence, present complaint is liable to be dismissed and he may be acquitted.
23. Whereas learned counsel for accused in support of above defence, he argued in his oral as well as written arguments that there is no loan transaction of Rs.49,000/- between complainant and accused and complainant has 12 C.C.No.2617/2019 no financial capacity to advance loan of Rs.49,000/- to accused. Moreover, the accused has no necessity to borrow loan of meager amount of Rs.49,000/- when accused is having annual turn over of 4 to 5 Crores. In fact, cheque has been misused by the complainant. He further argued that cheque pertaining to Rs.48,012/- has been issued in advance for security with respect to job work to be done by complainant. In fact, the complainant has not done job work regarding material supplied to complainant. So, accused returned the materials to complainant as complainant has not properly done the job work. So, question of payment towards job work does not arise. So, there is no legally enforceable debt/liability, whereas complainant has misused advance cheque given to him. So, these facts probabalize the version of the accused. He further argued that though initial presumption can be raised in favour of complainant as accused is not disputing his signature on the cheque, but it is rebuttable presumption, whereas standard of proof required by the accused to rebut the presumption is only "preponderance of probabilities". Herein this case, the accused has raised probable and acceptable defence that cheque for Rs.48,012/- has been given as advance 13 C.C.No.2617/2019 security cheque towards job work to be done by the complainant as specified by the accused, but complainant failed to complete the job work as specified by the accused. So, the accused is able to rebut the statutory presumption. Hence, complaint is liable to be dismissed and accused may be acquitted.
24. In support of his arguments, he placed reliance upon the judgments of Hon'ble Apex Court reported in
1. AIR 2019 SC 1983
2. (2007)5 SCC 264
25. Per contra, learned counsel for complainant argued that version of the accused cannot be believable and acceptable, because if really he had given cheque of Rs.48,012/- for advance security, then definitely he would have taken legal action to get back the said cheque. Even he did not give reply to legal notice issued by the complainant. So, these facts clearly show that accused has given present cheques for discharging of his liability. He further argued that though accused merely denying the hand loan transaction, but he has not properly explained as to how the cheque for Rs.49,000/- went to the custody of complainant as a holder of cheque, whereas accused 14 C.C.No.2617/2019 only in order to escape from his liability, he has set up false story of misuse of cheques. Hence, his version cannot be believable. Hence, accused has failed to rebut the mandatory presumption. Hence, he has to be convicted and maximum sentence may be imposed.
26. Having regard to the arguments of both learned counsels, it is worth to note ratio decidendi laid down Hon'ble Apex Court in very Rangappa V/s. Sri. Mohan's case, it is clearly observed 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"
27. At this juncture, it is worth to note ratio decidendi laid down by the Constitution Bench of Hon'ble Apex Court in the judgment reported in AIR 1964 SC 575 (Dhanvantrai Balwantrai Desai V/s. State of Maharashtra) which has been followed in the subsequent judgment reported in (2001)6 SCC 16 (Hiten P.Dalal V/s. Brathindranath Banerjee) wherein it is held that: 15 C.C.No.2617/2019
"That the distinction between the two kinds of presumption lay not only in the mandate to the court, but also in the nature of evidence required to rebut the two. In the case of a discretionary presumption the presumption if drawn may be rebutted by an explanation which "might reasonably be true and which is consistent with the innocence" of the accused. On the other hand in the case of a mandatory presumption "The burden resting on the accused person in such a case would not be as light as it is where a presumption is raised under Section 114 of the Evidence Act and cannot be held to be discharged merely by reason of the fact that the explanation is offered by the accused is reasonable and probable. It must further be shown that the explanation is a true one. The words unless the contrary is proved' which occur in this provision make it clear that the presumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible"
28. At this juncture, it also worth to note in another judgment of Hon'ble Apex Court reported in (2010)8 SCC 383 (Meghmala and others V/s. Narasimha Reddy and others) wherein it is held that:
"It is not like any other criminal case where the accused is presumed to be 16 C.C.No.2617/2019 innocent unless the guilt is proved. The presumption of innocence is a human right, however, subject to the statutory exceptions, the said principle forms the basis of criminal jurisprudence. For this purpose, the nature of offence, its seriousness and gravity thereof has to be taken into consideration. Statutes like the Negotiable Instruments Act, 1881; the Prevention of Corruption Act, 1998; and the Terrorist and Disruptive Activities (Prevention) Act, 1987, provide for presumption of guilt if the circumstances provided in those statutes are found to be fulfilled and shift the burden of proof of innocence on the accused. Thus, the legislature has adopted a deviating course from ordinary criminal law shifting the burden on the accused to prove that he was not guilt"
29. So from the above ratio, it is crystal clear that proceedings U/s.138 of NI Act is not like any other criminal case where the accused is presumed to be innocent unless the guilt is proved. On the other hand the legislature has adopted a deviating course from ordinary criminal law by shifting the burden on the accused to prove that he is not guilty. So, the accused must rebut the mandatory presumption by raising probable and acceptable defence to the satisfaction of the court, because the 17 C.C.No.2617/2019 presumption raised in favour of complainant is mandatory presumption, but not general presumption.
30. In the light of above ratio decedendi, if the present facts and situations are analyzed, it is important to note, accused has contended that he has not borrowed any loan from complainant and has not issued cheque bearing No.187260 for Rs.49,000/- to complainant and complainant has misused his cheque. But, it is important to note, he has not properly explained as to how his signed cheque bearing No.187260 went to the custody of the complainant. So, in absence of proper explanation and in absence of alleged misuse of the cheque by the complainant, his mere oral evidence cannot be believable and acceptable.
31. Coming to arguments of learned counsel for accused pertaining cheque bearing No.620598 for Rs.48,012/-, it is important to note, accused contended that said cheque has been issued for advance amount regarding job work to be done by complainant. But, complainant without doing satisfactory job work, he misused his cheque etc. 18 C.C.No.2617/2019
32. Having regard to the arguments of learned counsel for accused, it is worth to note, the accused in his cross-examination, he clearly admitted that:
"2017 jAzÀ £ÁªÀÅ ¦gÁå¢ PÀA¥À¤UÉ eÁ¨ï ªÀPïð ¤ÃqÀÄwÛzÉݪÀÅ. D jÃw £ÁªÀÅ PÀ¼ÀÄ»¹zÀ ¸ÀgÀPÀ£ÀÄß CªÀgÀÄ £ÀªÀÄä ¤zÉðñÀ£ÀzÀAvÉ eÁ¨ï ªÀPïð ªÀiÁr ¥ÀÅ£ÀB £ÀªÀÄUÉ ªÁ¥À¸ÀÄì PÀ¼ÀÄ»¸ÀÄwÛzÀÝgÀÄ. £Á£ÀÄ ºÁdgÀÄ¥Àr¹gÀĪÀ qÉ°ªÀj £ÉÄÁÃmïì £Á£ÀÄ ¦gÁå¢UÉ eÁ¨ï ªÀPïð ¤ÃqÀ¯ÁzÀ ¸ÀgÀPÀÄUÀ¼À qÉ°ªÀj £ÉÆÃmïì DVgÀÄvÀÛzÉ. D jÃw ¦gÁå¢ eÁ¨ï ªÀPïð ªÀiÁrzÀ £ÀAvÀgÀ ¦gÁå¢AiÀĪÀgÀÄ E£Áé¬Ä¸ï gÉÊ¸ï ªÀiÁr £ÀªÀÄä PÀ¼ÀÄ»¸ÀÄvÁÛgÉ. CzÀPÉÌ C£ÀÄUÀÄtªÁV £ÁªÀÅ CªÀjUÉ ºÀt ¥ÁªÀw ªÀiÁqÀÄvÉÛÃªÉ JAzÀÄ ¸ÀÆa¹zÀgÉ ¸Àj. ¤r-19 ºÁUÀÆ ¤r-25 E£Áé¬Ä¸ïUÀ¼À°è vÉÆÃj¹gÀĪÀ ªÉÆvÀÛªÀ£ÀÄß ºÉÆgÀvÀÄ¥Àr¹ G½zÀ E£Áé¬Ä¸ïUÀ¼À ªÉÆvÀÛªÀ£ÀÄß £Á£ÀÄ ¦gÁå¢UÉ ¥ÁªÀw¹gÀÄvÉÛÃ£É JAzÀÄ ¸ÀÆa¹zÀgÉ ¸Àj. ¤r-19 ªÀÄvÀÄÛ ¤r-25 E£Áé¬Ä¸ïUÀ¼À°è eÁ¨ï ªÀPïð ªÀiÁrzÀ ¸ÀgÀPÀ£ÀÄß £ÁªÀÅ ¥ÀqÉ¢gÀÄvÉÛÃªÉ JAzÀÄ ¸ÀÆa¹zÀgÉ ¸Àj. ¸ÁQëAiÀÄÄ ¸ÀévÀB £ÀÄrAiÀÄÄvÁÛgÉ, D jÃw ¥ÀqÉzÀÄ CªÀÅ £ÁªÀÅ ºÉýzÀAvÀºÀ jÃwAiÀÄ°è eÁ¨ï ªÀPïð 19 C.C.No.2617/2019 ªÀiÁrgÀĪÀÅ¢®è JA§ PÁgÀt¢AzÀ CªÀÅUÀ¼À£ÀÄß £ÁªÀÅ ¥ÀÅ£ÀB ¦gÁå¢UÉ ªÁ¥À¸ÀÄì PÀ¼ÀÄ»¹gÀÄvÉÛêÉ. D jÃw PÀ¼ÀÄ»¹gÀĪÀ §UÉÎ zÁR¯ÉUÀ¼ÀÄ £ÀªÀÄä PÀbÉÃjAiÀÄ°è EªÉ, DzÀgÉ CªÀÅUÀ¼À£ÀÄß £ÁåAiÀiÁ®AiÀÄPÉÌ ºÁdgÀÄ ¥Àr¹®è. ¤r 19 ºÁUÀÆ ¤r 2 E£Áé¬Ä¸ïUÀ¼À ªÉÆvÀÛªÀ£ÀÄß ¤ÃqÀ®Ä £Á£ÀÄ ¦gÁå¢UÉ ¤¦-1 ZÉPï£ÀÄß ¤ÃrgÀÄvÉÛÃ£É JAzÀÄ ¸ÀÆa¹zÀgÉ ¸Àj. ¦gÁå¢UÉ ¸ÀgÀPÀ£ÀÄß £ÁªÀÅ »AwgÀÄV¹zÀ §UÉÎ £ÉÆÃl¸ï ¤Ãr®è.
33. So, from the above admission, it is crystal clear that Ex.P-1 bearing No.620598 for Rs.48,012/- has been issued towards payment regarding job work done by complainant. It is significant to note, though the accused contended that complainant has not done job work properly as specified by him. So, he returned the materials to complainant, but admittedly, he has not produced any documents to show that he has returned materials to complainant due to defect in job work. It is further significant to note, the accused further admitted that even he has not given any notice to the complainant regarding alleged return of materials. So, under such circumstances, the contention of the accused that he 20 C.C.No.2617/2019 returned materials to the complainant thereby he need not pay any amount towards job work done by complainant, cannot be believable and acceptable. So, under such circumstances, the documents produced by the accused i.e., Ex.D-1 to Ex.D-35 will not helpful to his contention. Hence, I don't find any force in the learned counsel for accused.
34. At this juncture, it is also worth to take note of the conduct of the accused as specified U/s.114 of Indian Evidence Act that as per his contention, complainant has misused his cheques which were given for security purpose to complainant. If that is the case, a reasonable doubt arises in the mind of the court as to why accused has kept quite for along time without taking any legal action against complainant to get back his cheques and also alleged misuse of present cheques by the complainant. So, I am of the opinion, if at all accused had not issued present cheques to complainant for discharging of his legally enforceable debt, then definitely accused would have initiated legal proceedings like lodging of police compliant or issuance of legal notice against the complainant with respect to alleged misuse of his cheques, because no prudent man will keep quite, when his cheques 21 C.C.No.2617/2019 are misused by somebody else. So, non-taking any of these actions by the accused at appropriate time, it creates a reasonable doubt in the mind of the court regarding acceptance of his version that complainant misused the cheques. So, I come to clear conclusion that the defence raised by the accused is not probable and acceptable.
35. Coming to yet another argument of learned counsel for accused that complainant has filled up the contents of the cheques for his convenience which amounts to material alteration etc.
36. Having regard to the arguments of learned counsel for accused at this juncture, it is worth to note ratio laid down by Hon'ble Apex Court in the recent judgment reported in 2019 SCC On line SC 138 = Crl. Appeal No.230-231/2019 2019 (@SLP(Crl) No.9334- 35/2018) dated 06.02.2019 (Bir Singh V/s. Mukesh Kumar) wherein it is held that:
"A meaningful reading of the provisions of the Negotiable Instruments Act, in particular, Sections 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the 22 C.C.No.2617/2019 presumption that the cheque had not been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be attracted"
"If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence"
"It may reasonably be presumed that the cheque was filled in by the appellant- complainant being the payee in the presence of the respondent-accused being the drawer, at his request and/or with his acquiescence. The subsequent filling in of an unfilled signed cheque is not an alteration"
37. Having regard to the arguments of learned counsel for accused at this juncture, it is worth to note ratio laid down by Hon'ble Apex Court in the judgment reported in (2002)7 SCC 150 (P.K. Manmadhan Kartha V/s. Sanjeev Raj and another) wherein it is held that: 23 C.C.No.2617/2019
"Difference of handwriting and ink on the cheque did not rebut the statutory presumption U/s.139 and 118 of NI Act"
38. At this juncture it is also worth to note that view taken by Hon'ble High Court of Karnataka reported in ILR 2001 KAR 4127 (S.R. Muralidhar V/s. Ashok G.Y.) wherein it is held that:
Section 20 of NI Act - Inchoate stamped instruments "No law provides that in case of any negotiable instrument entire body has to be written by maker or drawer only. What is material is signature of drawer or maker and not the body writing hence question of body writing has no significance"
"It is not objectionable or illegal in law to receive a inchoate negotiate instrument duly singed by the maker despite the material particulars are kept blank if done with an understanding and giving full authority to the payee to fill up the material contents as agreed upon. Such a course of action in law cannot vitiate the transaction nor can invalidate the negotiable instrument issued and such transaction fully binds the maker of the Negotiable Instrument"
39. So, in the light of above principle if the present facts and situations are analyzed, as I have already 24 C.C.No.2617/2019 pointed out accused is not disputing issuance of cheques and his signatures thereon, whereas complainant is able to prove the existence of liability of Rs.49,000/- and Rs.48,012/- (covered under the cheques) by the accused as on the date of issuance of cheques by the aid of mandatory presumption as well as admitted tax invoices Ex.P-8 and Ex.P-9. So, under such circumstances, filling up body of the cheques by complainant or somebody else will not invalidate the cheque and that itself will not rebut the mandatory presumption raised in favour of complainant when version of the accused itself is not probable and acceptable. Hence, I don't find any force in the arguments of learned counsel for accused.
40. Coming to arguments of learned counsel for accused that complainant had no financial capacity to lend amount Rs.49,000/- etc.
41. Having regard to the arguments of learned counsel for accused, at this juncture, it is worth to note ratio laid down by Hon'ble Apex Court in the recent judgment reported in (2019) SCC Online SC 389 = Criminal Appeal No.508 of 2019 (Rohitbhai Jivanlal Patel V/s. State of Gujarat and another) wherein it is held: 25 C.C.No.2617/2019
"In the case at hand, even after purportedly drawing the presumption under Section 139 of the NI Act, the Trial Court proceeded to question the want of evidence on the part of the complainant as regards the source of funds for advancing loan to the accused and want of examination of relevant witnesses who allegedly extended him money for advancing it to the accused. This approach of the Trial Court had been at variance with the principles of presumption in law. After such presumption, the onus shifted to the accused and unless the accused had discharged the onus by bringing on record such facts and circumstances as to show the preponderance of probabilities tilting in his favour, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of funds for advancing loan to the accused-appellant"
"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 26 C.C.No.2617/2019 or want of evidence as regards source of funds were not relevant"
42. So, from the above ratio decedendi, it is crystal clear that when mandatory presumption has been raised in favour of complainant, which includes existence of legally enforceable debt, then court cannot expect evidence regarding the source of funds of the complainant for advancing loan to the accused, whereas expecting such evidence is contrary to presumption envisaged under Section 138 of N.I. Act. So, source of funds of the complainant is totally irrelevant. Hence, I do not find any force in the arguments of learned counsel for accused.
43. In view of binding precedent of Constitution Bench and Larger Bench judgments of Hon'ble Apex Court, the judgments of Hon'ble Courts relied by learned counsel for accused, will not helpful to his contention.
44. As I have already pointed that Hon'ble Apex Court in the Constitution Bench and Larger Bench Judgments stated supra, it is clearly held that presumption envisaged U/s.138 of NI Act is not general presumption but it is mandatory presumption, so the said 27 C.C.No.2617/2019 presumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible". So, I come to clear conclusion that accused has utterly failed to rebut the mandatory presumption raised in favour of complainant. Hence, I hold this point in Affirmative.
45. Point No.2: As I have already discussed in point No.1 that accused has issued cheques for discharging of his legally recoverable debt. Whereas, on perusal of bank endorsement given by bank authority clearly reveal that complainant had presented the said cheques within validity period, but cheque bearing No.620598 was dishonoured with endorsement "Payment Stopped by Drawer". But, it is significant to note, on perusal of Ex.D-28, the accused has not given satisfactory explanation to issue such instructions of stop payment to his banker. So, in absence of such satisfactory explanation, said dishonour of the cheque falls within the ambit of Section 138 of Negotiable Instruments Act, whereas another cheque bearing No.187260 was dishonoured with endorsement "Exceeds Arrangement". So, it is also falls within the ambit of insufficient funds in the account of accused.
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46. On perusal of Ex.P-5 which is legal notice issued to accused clearly reveal that complainant got issued said demand notice to accused within specified time of 30 days from the date of receiving of endorsement from bank. On perusal of Ex.P-7 postal acknowledgement card clearly reveals that legal notice has been duly served on accused.
47. So on considering the oral coupled with the documentary evidence of the complainant, they clearly proved that complainant has complied with mandatory requirements as specified U/s.138(a) and (b) of N.I. Act. Whereas, accused has not paid the cheques amount within specified time, inspite of service of demand notice. Hence, accused has committed offence punishable U/s.138 of NI Act. Hence, I hold point No.2 in Affirmative.
48. Point No.3: For the foregoing reasons discussed on points No.1 and 2, I proceed to pass the following:-
ORDER Acting under Section 255(2) r/w 264 of Cr.P.C., the accused is hereby convicted for the offence punishable u/S.138 of Negotiable Instruments Act.
(V. NAGARAJA) XXI ADDL. C.M.M., BENGALURU.29 C.C.No.2617/2019
On considering the facts and circumstances of the case, accused is hereby sentenced to pay fine of Rs.1,07,000/- (One Lakh and Seven Thousand only). In default he shall undergo simple imprisonment for a period of 1 (One) month.
In view of Section 357 of Cr.P.C., complainant is entitled for compensation of Rs.97,000/- (Ninety Seven Thousand only) out of above said fine amount.
After collecting the above fine amount, office is directed to pay Rs.97,000/- (Ninety Seven Thousand only) to complainant as compensation and defray remaining fine amount of Rs.10,000/- (Ten Thousand only) to state, after appeal period is over.
However, accused shall execute personal bond of Rs.1,07,000/- in view of Sec.437(A) of Cr.P.C.
The office is hereby directed to supply the copy of this Judgment to the accused on free of cost.
(Directly dictated to Stenographer on computer, computerized by him, corrected and then pronounced by me in the open court on this the 10th day of March, 2020) (V. NAGARAJA) XXI ADDL. C.M.M., BENGALURU.
ANNEXURE LIST OF WITNESSES EXAMINED FOR THE COMPLAINANT:
PW-1 : Suresh LIST OF DOCUMENTS MARKED FOR THE COMPLAINANT:
Ex.P-1 & 2 : Cheques
Ex.P-3 & 4 : Agreement
Ex.P-5 : Copy of Legal Notice
Ex.P-6 : Postal Receipts
30 C.C.No.2617/2019
Ex.P-7 : Postal Acknowledgement Card
Ex.P-8 & 9 : Tax Invoices
Ex.P-10 : GST Registration Certificate
Ex.P-11 : Bank Account Statement
Ex.P-12 : Certificate U/s.65(B) Indian Evidence Act
LIST OF WITNESSES EXAMINED FOR THE DEFENCE:
DW-1 : Uday Kumar P LIST OF DOCUMENTS MARKED FOR THE DEFENCE:
Ex.D-1 to 17: Office Copies of Delivery Notes Ex.D-18 to 25: Tax Invoices Ex.D-26 & 27: Two Delivery Challans Ex.D-28 : Stop Payment Instruction Letter Ex.D-29 : Bank Account Statement Ex.D-30 & 31: Balance Sheets Ex.D-32 : Payment Details Ex.D-33 : VAT Registration Certificate Ex.D-34 : Bank Account Statement Ex.D-35 : Account Statement Extract (V. NAGARAJA) XXI ADDL. C.M.M., BENGALURU.