Bangalore District Court
Rahul Enterprises vs Champion Mining And Aggregates Pvt Ltd on 19 February, 2025
SCCH-23 1 CC.No.5400/2019
KABC020242712019
IN THE COURT OF XXI ADDL.SMALL CAUSE JUDGE
AND MOTOR ACCIDENT CLAIMS TRIBUNAL,
BENGALURU. (SCCH-23)
DATED THIS THE 19th DAY OF FEBRUARY - 2025
PRESENT: Sri. Sri. Shreyansh Doddamani
B.Com. LL.B,
XXI ADDL. SCJ & ACJM
MEMBER - MACT, BENGALURU.
C.C. No.5400/2019
Between :
M/s Rahul Enterprises,
having its office at No.2153,
D-Block, Sahakarnagar,
Bengaluru-560092.
Also at No.21, Byrapura,
Javagal Hobli, Arasikere Taluk,
Hassan District.
By its authorized signatory,
Mr. Umesh A Patil. ..COMPLAINANT
(By Adv.: Sri.Girishchandra. N
and Sri. Vishwanath Gowda. A.M)
And
SCCH-23 2 CC.No.5400/2019
M/s Champion Mining & Aggregates Pvt. Ltd.,
Having its registered office at :
Plot No.183, Flat No.402,
Laxmi Aadarsh Residency,
Bhagyanagar Colony,
Kukutpally,
Hyderabad-500072.
(Telangana State)
Represented by its Director and
authorized signatory,
Mr.A.K. Sharma
(By Adv.: Sri. Prabhakar. L Shetty) .... ACCUSED
Date of complaint : 10.05.2019
Date of commencement of
Evidence : 18.09.2019
Offence charged : Sec.138 of Negotiable
Instruments Act.
Date of Judgment : 19.02.2025
Opinion of the Judge : Accused found guilty.
(Shreyansh Doddamani)
XXI Addl. Small Causes Judge
& ACJM, Bengaluru.
SCCH-23 3 CC.No.5400/2019
JUDGMENT
The present case arises out of the complaint filed u/sec 200 of Code of Criminal Procedure for an offence punishable under section 138 of Negotiable Instrument Act.
2. The case of the complainant in brief is that: The complainant is owner and proprietor of M/s Rahul Enterprises. The complainant entered into an agreement with one Suresh B.P. s/o B.K.Prasanna Kumar for purpose of quarrying, processing building stone and running a crusher unit at Sy.No.21 of Byrapura village, Javagal Hobli, Arasikere, Hassan District. Mr. Suresh B.P. was the lessee and license holding quarrying lease for an extent of 4 acres in Sy.No.21 of Byrapura village from the Government of Karnataka vide Licence No.HMG-490 dated 11.05.2015, registered vide Licence Deed No.BAN-1-00345/2015-16, stored in C.D. No. BAND90 and registered on 03.06.2015 in the office of Banavara, Arasikere Taluku. Said Mr.Suresh B.P, authorized the complainant as per Memorandum of Understanding dated 07.08.2015 to exploit building stones in SCCH-23 4 CC.No.5400/2019 Sy.No.21 commencing from 01.08.2015 ending on 31.07.2016. The complainant started business under name and style M/s Rahul Stone Crusher to undertake business of quarrying exclusively and thereby obtained Tax registration certificate. Meanwhile accused approached with proposal to install quarrying machinery, two stage crushing and screening plant 150-200tph and deliver finished products like Railway blast, GSB, WMM, 40mm, 20mm Jalli and CRF(dust) on tonnage basis. After discussions complainant and accused entered into an Memorandum of Understanding dated 19.10.2015. Thereafter, it came to know to the complainant that the accused was facing financial crisis and was delaying the work. He requested the complainant to help financially to set up machinery and commencement of business. On request the accused had received more than 90 lakh from complainant in several dates. But the accused had not invested the said amount in the business and not started quarrying business. Due to which the complainant had incurred heavy financial losses. Though the agreement tenure from 20.12.2015 to 31.07.2016 lapsed no production SCCH-23 5 CC.No.5400/2019 was carried out by the accused. Thereafter, the complainant urged the accused for settlement of amount. On 02.07.2018 the accused came to his office at Shankaranagar Bangalore with proposal for settlement for Rs.40,00,000/-. After discussion the complainant agreed and the accused issued 4 cheques bearing No.494367 of Rs.20,00,000/- dated 15.12.2018, bearing no.494368 of Rs.10,00,000/- dated 10.01.2019, bearing no.494369 dated 15.02.2019 of Rs.5,00,000/- and bearing no.494370 dated 10.03.2019 of Rs.5,00,000/- payable at Axis Bank Ltd, Kukatpally Branch, Hyderabad. And assured to complainant that the same will be duly honored on presentation.
3. The complainant had presented the cheque for clearance at Corporation Bank, Shankarnagar Branch, Bengaluru but all cheques returned unpaid as 'Account closed'. Thereafter, the complainant got issued legal notice dated 05.04.2019 calling upon the accused to repay the cheque amount within 15 days of its receipts. As per the information of postal authority the said notice duly served to the accused. But SCCH-23 6 CC.No.5400/2019 thereafter the accused had not repaid the cheque amount. Hence, the accused has committed the offence punishable U/s 138 of Negotiable Instrument Act. Hence, this complaint had been filed.
4. The complainant filed Private Complaint in PCR no.2333 of 2019 on 10.05.2019. After the complaint was presented to the Court, on 12.06.2019 the Court had taken cognizance of the offence and The sworn statement of the complainant was recorded. Since there was sufficient materials to proceed against the accused it was registered in register No.III and the process issued to the accused.
5. On receipt of the summons the accused has appeared before the Court and secured bail. He was furnished with the prosecution papers. The substance of the accusation was read over and explained to him. He had pleaded not guilty and claimed to be tried.
6. The complainant thereafter had examined as PW.1 and got marked Ex.P1 to 18 documents and closed his side. The SCCH-23 7 CC.No.5400/2019 313 statement of the accused was recorded. The accused had denied the incriminating circumstances appearing against him and accused has examined himself as DW.1 and got marked Ex.D1 to 4 documents.
7. Heard the arguments of both sides. Perused the materials on record. The following point arises for my consideration:-
● Point no.1:- Whether the complainant proves that, accused had issued the cheque Ex.P-1, 3, 5, 7 towards discharge of legally enforceable debt?
● Point no.2:- Whether complainant further proves that, the mandatory requirements of section 138 of N.I. Act have been complied with?
● Point no.3:- If so, accused has committed the offence punishable U/s 138 of N.I. Act? ● Point no.4:- What order? SCCH-23 8 CC.No.5400/2019
8. My answer to the above points are as under:-
Point No.1 :- Affirmative. Point No.2 :- Affirmative. Point No.3 :- Affirmative. Point No.4:- As per final order for the following;
REASONS
9. Point No.1 and 2:- The case of the complainant in support of his case examined himself as PW.1. In his evidence affidavit he has reiterated the complaint averments and got marked the Ex.P1 to P18 documents. The accused counsel cross-examined the PW.1 and raised defence that he entered in to Memorandum of Understanding, herein after called as MOU, with complainant. As per the MOU complainant had to submit Explosive Clash Blasting license, Punchayat clearance, Quarry lease, quarrying agreement with owner of the land etc., and he had to solve the problems arises in local limits. As per clause 14 after fulfillment of statutory requirement accused should have start the work. The complainant had to submit the documents within 90 days, if he failed to submit there was grace period for 15 SCCH-23 9 CC.No.5400/2019 days. If the complainant failed to obtained above statutory documents within time, he has to pay the ideal charges. Accordingly as per clause 8 and 18 the complainant had paid Rs.65,00,000/- to the accused. But he had not submitted the statutory documents within time. The complainant paid Rs.65,00,000/- towards machineries installation as per MOU and paid ideal charges due to delay in submitted the statutory required documents. Thereafter, the land owner of Sy.180 started objections, therefore, business work not started. The complainant has not taken the land Sy.180 for mining from its owner. He has not taken license and necessary documents to the said land. So, due to the attitude of complainant loss caused to him. Amount paid was as per clause 8 and 18 of MOU. However, the complainant came with some gunda elements and forcibly took him to their office and had taken his signatures and also taken 4 cheques. He had not issued cheuqes to him. By using the said cheques filed false case. The complainant company created some documents for purpose of this case and filed false case. Therefore, there is no legally enforceable debt. SCCH-23 10 CC.No.5400/2019
10. The accused in his defence has not disputed the signature appearing on Ex.P1, 3, 5 and 7 or the fact that, it is the cheque drawn on its account maintained at Axis Bank Ltd, Kukatpally, Hyderabad Branch. The accused had taken defence that the complainant not submitted statutory required documents for mining business and he had not entered in to an agreement with land owner bearing Sy. no.180 of Byrapur village. Due to the fault of the complainant he had not started the business. The complainant had taken him forcibly and forcibly taken blank cheques with signature. And misused the said cheques and filed this false case. He has not issued any cheques to accused. The complainant breach the MOU. Therefore, the said amount is not coming under the legally enforceable debt. Hence, He sought for acquittal.
11. To attract the offence U/sec 138 of N.I. Act the complainant is required to prove the existence of legally enforceable debt for which cheque in question was issued. As per the Section 139 of Negotiable Instrument Act, there is SCCH-23 11 CC.No.5400/2019 presumption in favour of complainant, as to the existence of the legally enforceable debt or other liability. But the said presumption is rebuttable.
12. The learned counsel of the complainant has argued that, the accused not denied the signature on cheque Ex.P1. The accused has denied issuance of cheque. He has taken defence that the complainant with the help of Gunda elements forcibly took the blank cheuqes with signature at their office. But not documents in this regard. If the complainant took him forcible, he would have lodged complaint before the concerned police. But he did not to do so. It clears that he came to the office of complainant and compromised with him and issued cheques. There is no probable defence. Therefore, there is initial presumption available U/s 138 if N.I. Act, and accused has failed to rebut the said presumption by any evidence. Hence, the accused has to be convicted.
13. The learned counsel for the accused has argued that, the complainant has not complied the MOU. He has failed to SCCH-23 12 CC.No.5400/2019 supply the statutory requirements to start the business. He had not owner or taken lease in land Sy.No.180 of Byrapura village, Arasikere. He installed the machineries. As per MOU after installation the complainant paid total an amount of Rs.65,00,000/- as installation charges in different dates and it includes ideal charges. The owner of the land SY.No.180 started dispute, so he unable to start the business. The complainant failed to solve the dispute. Amount paid as per clause 8 and 18 of MOU. So, the amount can not be refunded. There is not clause for refund the machineries charges and ideal charges. Due to the fault of complainant only business not started. He has not fulfilled the conditions of MOU. But he took the accused from his place with gunda elements to his office and forcibly had taken the blank cheques with signature and misused the cheques and filed this false case. It is not coming under the legally enforceable debt. The PW.1 in his cross examination admitted that he failed to submitted the statutory requirements within time and also admitted that he had not permitted for quarrying with owner of land Sy no.180. Therefore, it is not legally SCCH-23 13 CC.No.5400/2019 recoverable debt. The complainant has not complied the conditions of section 138 of N.I. Act, therefore, he prayed to acquit the accused.
14. On considering the materials placed on record and lengthy cross-examination of PW.1 by accused counsel, it was converted as summons case. It is relevant to note here that as per materials placed on record Ex.P1, 3, 5 and 7 cheques being drawn on the account of the accused at Axis Bank Ltd, Kuputapally, Hyderabad is admitted. The signature on the Ex.P1, 3, 5 and 7 is also admitted. As per U/sec 139 of the N.I Act, there is an initial presumption in favour of complainant that, the holder of a cheque has received the same for discharge in whole or in part of any debt or other liability. So also U/sec 118 of the N.I. Act there is a presumption that, any negotiable instrument is for consideration drawn on the date and in favour of the holder shown there on. Until both the presumptions are rebutted the cheque being issued in favour of the complainant for total Rs. 40,00,000/- on the day shown therein has to be SCCH-23 14 CC.No.5400/2019 presumed to be correct.
15. In view of the above provisions of law there is an initial presumption in favour of the complainant that, the accused towards discharge of legal liabilities in total of Rs.40,00,000/- had issued the cheque Ex.P-1, 3, 5 and7. It is now for the accused to rebut the said presumption by adducing some probable evidence in his defence.
16. In the present case on the hand, on perusal of the documents placed on record and evidence of both side it is an undisputed fact that the complainant was the partner with Suresh B.P. for purpose of quarrying in Sy.21 of Byrapura village. It is also an undisputed fact that complainant and accused entered in to an MOU dated 19.10.2015 Ex.P16. It is an admitted fact that as per clause no.5 the complainant has to submit explosive clash blasting license, panchayat clearance, environmental clearance, quarry lease document to the accused before quarry operation and before deployment of machinery. It is also an undisputed fact that SCCH-23 15 CC.No.5400/2019 there was delay in obtain the said documents. It is also an admitted fact that the accused installed machineries but they failed to start the production. For which the complainant contended that even there was 90 days time for submit records practically it was not possible. And even he had submitted all necessary documents the accused had not started the production. Therefore, time for permission to product the mining was lapsed. When he called the accused, he came and go compromise and issued said cheques for total of Rs.40,00,000/-. Per contra the accused contended that there was not contract between complainant and owner of the land bearing Sy. no.180 and 21 of Byrapur. Therefore, they objected to start the production. Hence, due to the fault of the complainant business was not started. He had not compromised and issued cheques. But the complainant took him their office forcibly and got signed to the cheques forcibly. Therefore, it was not legally enforceable. But in this regard no evidence at all. Admittedly he had not given any complaint against the complainant for said allegation. If it was true he would have lodged complaint. Even he would SCCH-23 16 CC.No.5400/2019 have filed private complaint. But he has not taken any action in this regard. Therefore, the oral allegation against the complainant as he forcibly took him and got signed on the cheques is not acceptable and believable. For the shake of arguments if believed it, why he went with cheque book to his office?, there is no answer to the same. The accused admitted that he received Rs.65,00,000/-. It is also an admitted fact that due to some reason production was not started. The MOU is also silent in this regard, there is no conditions or solutions for if production not started within time who is responsible for it. The learned advocate for accused argued that the complainant was not entered into an agreement with owner of land Sy.no.21 and 180 directly, said owners obstruct to start the business, hence it was illegal and the amount is not legally enforceable debt. No doubt in this regard there is no clause in the MOU. But transaction of Rs.65,00,000/- is admitted. In such circumstances even the complainant had taken license for mining in one and offered the accused to mining in another land illegally, and if he started production, then it was illegal. But the accused SCCH-23 17 CC.No.5400/2019 received an amount for legal transaction but because of non- co-ordination and illegal offer business was not started and license was lapsed. There is no evidence to show that the complainant forcibly took him and had taken blank cheques with signatures. So, it was legally enforceable debt. The accused failed to prove that how the cheques were went in possession of complainant. The oral evidence of the accused is not believable. Even in the statement of accused under section 313 of Cr.P.C., he has not explained any thing. He simply denied the incriminating circumstance found in the evidence of PW.1 and submits he had not committed any offence. The accused examined himself as DW.1 and deposed his defence. But no documents for his allegation. He sent the mail regarding his allegation as per Ex.D4 but it is not sufficient to believe. Therefore, the adverse inference can be drawn against the accused regarding those documents. The documents clearly discloses that the accused received an amount of Rs.65,00,000/- and due to fault of both complainant and accused business was not started and accused issued above cheques to discharge his liability. SCCH-23 18 CC.No.5400/2019
17. The complainant has clearly shown the issuance of cheque and its dishonor. It is relevant to note that when the accused admitted the signature on cheque there is a presumption U/section 118 of N.I act that the cheque is issued as for consideration drawn on the date and in favour of the holder shown there on. The presumption is rebuttable. The accused has to rebut the same by probable evidence.
18. The complainant has proved that the cheque Ex.P1, 3, 5 and 7 was issued for legally enforcible debt. The cheque Ex.P1, 3, 5, and 7 being drawn o the account of the accused is not disputed. The said cheque having been dishonored when it was presented by the complainant before the bank for encashment is also not seriously disputed by the accused. PW.1 also speak of dishonor of the cheque when presented for encashment it was returned as Funds Insufficient. Thereafter, notice Ex.P9 being the issued and same was served upon the accused. The accused replied to the same by setting up the defence as it was for purpose of machinaries and ideal charges. But failed to prove his defence. As such it SCCH-23 19 CC.No.5400/2019 raises strong presumption that the amount was not paid. Therefore, this Court is opinion that, the complainant has succeeded in proving the existence of legally enforceable debt for which Ex.P1, 3, 5 and 7 was issued. The complainant has complied the all conditions of section 138 of N.I. Act. Accordingly this Court has answered Point no.1 and 2 in the affirmative.
19. Point no.3:- In view of the the above findings on point no.1 and 2 the complainant has proved that, Ex.P1, 3, 5 and 7 was issued by the accused for discharge of legally enforcible debt. Hence, the accused is found guilty of an offence punishable U/sec 138 of N.I act. Therefore, this Court has answered the point no.3 in the affirmative.
20. Point no.4:- In view of the above discussions and the findings on aforesaid points, this Court proceed to pass the following:-
ORDER In exercising the powers conferred under section 255(2) of SCCH-23 20 CC.No.5400/2019 Code of Criminal Procedure the accused is hereby found guilty for the offence punishable U/section 138 of Negotiable Instrument Act.
The bail bonds and surety bonds stand canceled.
The accused is sentenced to pay the fine of Rs.41,00,000/-
(Forty one lakh).
It is further ordered that out of the said fine amount an amount of Rs.40,50,000/- (Forty lakh fifty thousand only) shall be paid to the complainant as compensation and the remaining amount of Rs.50,000/- (Fifty thousand only) shall be remitted to the government.
SCCH-23 21 CC.No.5400/2019
In default of the payment of the fine amount the accused shall undergo simple imprisonment of Six months.
[Directly typed by me in my lap top, corrected by me and then, pronounced by me in the open Court this the 19th day of February - 2025].
(Shreyansh Doddamani) XXI Addl. Small Causes Judge & ACJM, Bengaluru.
ANNEXURE List of witnesses examined for complainant:-
PW.1 : Sri. Umesh A Patil List of documents marked for complainant:-
Ex.P.1 Cheque
Ex.P.1(a) Signature of accused
Ex.P.2 Bank Memo
Ex.P.3 Cheque
Ex.P.3(a) Signature of accused
Ex.P.4 Bank Memo
Ex.P.5 Cheque
Ex.P.5(a) Signature of accused
Ex.P.6 Bank Memo
Ex.P.7 Cheque
Ex.P.7(a) Signature of accused
Ex.P.8 Bank Memo
Ex.P.9 Office copy of Legal notice
SCCH-23 22 CC.No.5400/2019
Ex.P.10 Postal receipt
Ex.P.11 Postal acknowledgement
Ex.P.12 Bank Statement (4 in no's)
Ex.P.13 Bank statement (2 in no's)
Ex.P.14 Vat Certificate
Ex.P.15 Partnership Deed
Ex.P.16 MOU
Ex.P.17 Copy of Letter dated.23.11.2015
Ex.P.18 MDP (87 in no's)
List of witnesses examined for Accused:-
DW.1 : Sri. Athul Kumar K Sharma List of documents marked for Accused:- Ex.D.1 Reply notice Ex.D.2 Copy of Mail Ex.D.2(a) Certificate u/s 63 of BSA Ex.D.3 Unserved postal cover Ex.D.3(a) Copy of notice Ex.D.4 6-E-Mail conversation subject to production of certificate u/s 65B of Evidence Act (Shreyansh Doddamani) XXI Addl. Small Causes Judge & ACJM, Bengaluru.