Bangalore District Court
Mr.S.Jaganathan vs Mr.V.Govindaraj on 2 January, 2020
THE COURT OF THE XIX ADDL.CHIEF METROPOLITAN
MAGISTRATE AT BENGALURU CITY.
Dated this the 2nd day of January, 2020.
PRESENT: SRI MADHVESH DABER, B.COM.,L.L.B(SPL).,
XIX ADDL.C.M.M., BENGALURU.
Case No: C.C.No.3188/2018
Complainant: Mr.S.JAGANATHAN
S/o. N.K.Shanmugam,
Aged about 38 years,
R/at Rida Mansion, 20/21/22,
Dhasarahalli Main Road,
Hebbal, Kempapura Road,
Coffee Board Layout, 20th Cross
Bengaluru560024.
(By M.D.Anuradha Urs., Advocates)
V/S
Accused: Mr.V.GOVINDARAJ
S/o Venkatasamy
Aged about 39 years,
R/a,C/o, M/s. G.R.Aqua Industries,
Bathalapalli |Village, Hosur Taluk,
Krishnagiri District635109,
Tamil Nadu.
Offence complained of: U/s.138 of N.I.Act.
Plea of accused: Pleaded not guilty.
Opinion of the Judge Accused found guilty.
Date of order: 2nd January, 2020.
2 C.C.No.3188/2018
JUDGEMENT
The complainant has filed this complaint U/s.200 of Cr.P.C. against the accused for the offence punishable U/s.138 of N.I. Act.
2. The brief facts of the complaint are that; The complainant contends that, he knows the accused for the last two years and both of them hail from Krishnagiri in Tamil Nadu. The accused was running ISO certified RO Water Plant under the name and style 'M/s G.R Aqua Industries' at No. 402/ 11, Kasavakutta Road, Bathalapalli Village, Hosur Taluk, Krishnagiri District635109. The accused impressed upon the complainant to become a partner in his business by convincing him that another friend of accused viz., Mr.R.Ravichandran was also willing to become a partner and they could earn huge profits through his partnership. So the complainant agreed to become a partner with accused. In this regard a Partnership Deed dated 01.04.2016 was executed in between complainant, accused and one Mr.R.Ravichandran. The complainant has contributed a sum of Rs.6,00,000/ by 3 C.C.No.3188/2018 cash. Though the Partnership Firm was established and business has commenced, but the accused had retained sole power of operating the Bank account. The accused refused to render proper and transparent accounts to the complainant. So the attitude of accused led to misunderstanding and lack of trust between complainant and accused. So the complainant wanted to come out of the partnership business. Thereafter the complainant having no other option decided to opt out of the business during March 2017 and demanded for the return of share capital amount and share of profit. The accused realising that he was cornered and his malafide intention had been exposed, agreed to settle the dues by the end of July 2017. Then he issued three post dated cheques for Rs.2,00,000/ (Rupees Two Lakhs Only) each drawn on Syndicate Bank Ltd., Sipcot Branch, Krishnagiri. However on presentation the said cheques came to be dishonored for the reason "Insufficient Funds". Thereafter, the complainant got issued a Legal Notice to the accused on 03.12.2017 calling upon the accused to pay the entire cheque amount. Despite service of the notice the accused deliberately did not repay the cheque 4 C.C.No.3188/2018 amount. Thereby accused has committed offence under Section 138 of NI Act. Hence, this complaint.
3. Soon after filing of the complaint, cognizance of the offence was taken. Matter was registered as P.C. After recording of sworn statement of the complainant, the Private Complaint lodged by the complainant was registered as a Criminal Case. Summons was issued as against the accused. The Accused appeared through his Counsel and he was enlarged on bail. Substance of accusation was read over to the Accused. The Accused pleaded not guilty and claimed to be tried.
4. The complainant has been examined as PW1 and documents Ex.P1 to Ex.P15 were got exhibited and closed his side.
5. After closure of the complainant side evidence, accused Statement u/Sec.313 of Cr.P.C. was recorded. The accused denied the incriminating evidence in toto. The accused has not been examined. He has not led his defence evidence. However document Ex.D1 was confronted to PW1 in the cross examination 5 C.C.No.3188/2018
6. Heard Arguments. The leaned counsel for complainant filed written arguments and additional written arguments which are part and parcel of the records.
7. Now, the points that arise for my consideration are as under:
i) Whether the Complainant proves that the accused in discharge of legally enforceable debt, issued three cheques for Rs.2,00,000/(Rupees Two Lakhs Only) each which on presentation came to be dishonoured and he has failed to honour the notice and not paid the amount and thereby, committed offence u/Sec.138 of N.I. Act ?
ii) What order ?
8. My findings to the above points for consideration are as under:
Point No.1: In the Affirmative.
Point No.2: As per final order for the following:
:: R E A S O N S ::
9. Point No.1: In order to prove his case, the Complainant viz., Mr.S.JAGANATHAN entered into the witnessbox and filed an affidavit in lieu of examinationinchief 6 C.C.No.3188/2018 and reiterated the complaint averments and got examined himself as PW1 and documents Ex.P1 to Ex.P15 were got exhibited and closed his side. The accused has not led his defence evidence. However document Ex.D1 was confronted to PW1 in the cross examination.
10. During arguments the learned Counsel for Complainant filed written arguments and additional written arguments and argued that, the complainant has invested and amount of Rs.6,00,000/ with accused in RO water plant. With regard to the partnership between complainant and accused a Partnership Deed was executed on 01.04.2016. Similarly, additional Partnership Deed was also executed. The accused has not shown any document/books of account to complainant.
So there was lack of trust in between complainant and accused. Thereafter, the accused agreed to repay the amount of Rs.6,00,000/ through Memorandum of Understanding (MOU) entered into between the parties. Accordingly, the accused issued three cheques which on presentation came to be dishonoured for the reason "Insufficient Funds". So the ingredients of Section 138 of Negotiable Instruments Act are satisfied. The presumption under Section 138 of Negotiable 7 C.C.No.3188/2018 Instruments Act is not rebutted. The accused has not led defence evidence. No evidence is led with regard to misuse of the cheque. The accused has not given any Police complaint or stop payment direction with regard to the misuse of the cheque. There is no document supporting the defence of the accused. No evidence is led with regard to issuance of cheque for auditing purpose. But MOU is helpful to the complainant. It is mentioned in MOU with regard to issuance of cheque for repayment of the amount deposited by him. So MOU being an important document supports to the complainant case. Hence, the learned counsel for complainant prayed to convict the accused.
11. In support of his arguments, the learned Counsel for the complainant relied upon the following rulings;
1. AIR 2001 SC 2895 K.N.Beena v/s Muniyappan & Another.
2. Crl. Application No. 702 of 2019 Amit Digvijay Singh v/s Gokulda Jagannath Bhutada.
3. 1999(1) CTC 6 M/s Balaji Seafoods Exports v/s Mac Industries Ltd.,
4. AIR 2019 Supreme Court 2446 8 C.C.No.3188/2018 Criminal Appeal Nos.230231 of 2019 (@ SLP(CRL) Nos.933435 of 2018) Bir Singh v/s Mukesh Kumar.
5. AIR 2019 Supreme Court 1876 Rohitbhai Jivanlal Patel v/s State of Gujarat and another.
6. (2003) 3 SCC 232 Goa Plast (P) Ltd v/s Chico Ursula D'Souza.
7. 2019 SCC Online Mad 187 A.K.Mohammed Farook v/s M.Syed Jaheer Hussain.
8. CRL.No. 706 of 2014 Suresh Chandra Goyal v/s Amit Singhal.
9. Madras High Court 1992 75 CompCas 372 Mad Dated 20th August 1991.
10. Madras High Court Dated 25th September 2019 CRL.No.63 of 2012 S.Ravi v/s S.Kumaresan.
11. In the Supreme Court of India Criminal Appeal No.664 of 2012 M.Abbas Haji v/s T.N.Channakeshava.
12. In the High Court of Punjab and Haryana Dated 27.08.2019 Kailash Vati v/s M/s Ludhaina Beverages Pvt. Ltd.,
13. Supreme Court of India 9 C.C.No.3188/2018 Criminal Appeal No. 1545 of 2019 Dated 17 October 2019 Uttam Ram v/s Devinder Singh Hudan.
14. Supreme Court of India Dated 5th October 2019 Criminal Appeal No. 1731 of 2017 M/s Meters and Instruments v/s Kanchan Mehta.
12. Per contra the learned counsel for accused argued that the complainant has instituted a false case against the accused. In fact the motherinlaw of the complainant was an auditor, though the agreement was entered into between the parties for running the business, but all the three cheques were given through the motherinlaw of complainant. They were misused by complainant and filed a false complaint against the accused. It is argued that in order to rebut the presumption under Section 139 of Negotiable Instruments Act the accused need not enter into witness box. There are several infirmities in the cross examination of PW1 which rendered his version doubtful. The Ex.P.11 is an important document. As per Ex.D.1 the accused alone was not authorized to run the partnership account. The cheque was presented for encashment in November 2017. The legal notice was not issued to the proper 10 C.C.No.3188/2018 residential address of accused. There are several infirmities in the cross examination of PW1 which rendered his version doubtful. The accused elicited facts from the cross examination of PW1 and rebutted presumption under section 139 of Negotiable Instruments Act. It is not forth coming as to how the amount of Rs.6,00,000/ was arrived at by the complainant. The accounts for formation of firm are not produced. There is material alteration in the cheque. The accused has not authorized the complainant to fill up the contents of the cheque. The complainant has not produced any documentary evidence to show that he had paid an amount of Rs.6,00,000/ to the accused. So the learned counsel for accused admitted that the case of the complainant is unbelievable. Hence, the learned counsel for accused prayed to acquit the accused.
13. In support of his arguments, the learned Counsel for the accused relied upon the following rulings;
1. In the Supreme Court of India Criminal Appeal No.636 of 2019 Basalingappa v/s Mudibasappa.
2. CDJ 2018 DHC 1427 Krishan @ Krishan Pal Tanwar v/s Rohta Kumar Verma.
11 C.C.No.3188/2018
3. Criminal Appeal No.103 of 2008 Tejendra Singah v/s Ravindrakumar.
4. High Court of Madras S.A.No.740 of 2015 Mrs.M.Mallika v/s Mr.Kasi Pillai.
5. CDJ 2018 Kar HC 993 H.N.Dhanalakshmi & others v/s K.N.Shankar.
6. CDJ 2018 MHC 6091 P.Murugesan v/s S.Elango.
14. I have carefully gone through the principles of above rulings relied upon by the learned counsel for complainant and accused. Keeping in mind the principles of above rulings, I have examined the evidence on record.
15. It is trite principles of law that the presumption u/Sec.139 of N.I. Act is initially in favour of the Complainant that the cheque was issued for discharge of a legally recoverable debt or liability. However, the said presumption is rebuttable presumption. The Accused has to rebut the said presumption by taking a probable defence. The presumption can be rebutted even by eliciting facts from the crossexamination of PW1 or by leading defence evidence. For that Accused need not enter into the witnessbox. Even the question of legally recoverable debt 12 C.C.No.3188/2018 or liability can also be contested. Whether the presumption is rebutted or not? depends on facts and circumstances of each case. This principle is laid down by Hon'ble Supreme Court in AIR 2010 SC 1898 Rangappa v/s. V. Mohan. In the light of above principles of law now I have to see whether the presumption is rebutted or not? and Complainant has proved his case or not?
16. The brief facts of the case of the complainant are that, the complainant, accused and one R.Ravichandran formed a Partnership firm viz., 'M/s G.R Aqua Industries' at Bathalapalli Village, Hosur Taluk, Krishnagiri District. In the said Partnership the complainant invested a sum of Rs.6,00,000/. However, the accused did not render proper transparent accounts to the complainant. So the complainant being fed up by the attitude of the accused, wanted to come out of the partnership business. Thereafter, the accused agreed to repay a sum of Rs.6,00,000/ to the complainant which was deposited by him. He issued three cheques which on presentation came to be dishonoured for the reason "Insufficient Funds". Thereafter the complainant complied all 13 C.C.No.3188/2018 the legal formalities and filed this complaint against the accused.
17. However the case of the accused is that, the mother of the complainant was auditor of the firm of the complainant and accused. So the mother of the accused used to receive blank signed cheques from the accused for payment of tax and license fee. Accordingly, the accused issued three blank cheques to the complainant as a security for the said transaction. It is the contention of the accused that, the complainant and his motherinlaw colluded with each other and got filed this false complaint against the accused.
18. However in regard to the stand taken by the accused, accused has not entered into witness box and not led any evidence. Even in the cross examination of complainant also no admission was extracted with regard to the defence of the accused. It is contended by learned counsel for accused that for rebutting presumption under section 139 of Negotiable Instruments Act the accused need not enter into witness box. It is enough if the accused elicits certain facts which probablise 14 C.C.No.3188/2018 the case of the accused. So the learned counsel for accused contended that PW1 has admitted in the cross examination that no business was started in the name of 'M/s G.R Aqua Industries'. That apart there are two Partnership Deeds in which there is no mention of the accused first depositing of Rs.3,50,000/ and then depositing Rs.2,50,000/ in November 2016. So it is contended that the case of the complainant is unbelievable. According to Ex.D1 i.e., Partnership Deed of 23.12.2016 complainant agreed to pay of Rs.6,03,500/. However the complainant has failed to produce the Partnership Deed dated 23.12.2016. So the complainant has not approached the court with clean hands. The complainant has not produced any document to show that after 23.12.2016 he has invested Rs.6,03,500/. The PW1 has not produced any document to show that after 23.12.2016 they started business in the name of G.R Aqua Industries. According to the Ex.P11 Partnership Deed the complainant and accused were authorized to jointly run the account of the partnership firm. But the complainant has falsely deposed before the court that the accused alone was authorized to run the business which is 15 C.C.No.3188/2018 unacceptable one. Moreover it is contended that as per Ex.P14 three cheques were given as a security. So they were not issued for the discharge of legally recoverable debt or liability. So the learned counsel for accused without leading the evidence of accused, argued that by eliciting facts from the cross examination of PW1, the accused has probablised his case.
19. But as discussed earlier with regard to the defence taken by the accused, he has not led any defence evidence. Admittedly, no admission was extracted from the mouth of the complainant in this regard. Moreover the important document is Ex.D1 which was confronted to PW1 in the cross examination. It is the Partnership Deed dated 23.12.2016. This document also does not probablise the case of the accused. So nowhere in the evidence of complainant it was elicited that the cheques which were given to motherinlaw of the complainant for payment of taxes and license fee have been misused by the complainant and got filed this false complaint. Admittedly, there is nothing on record to show that for misuse of the cheques the accused has taken any legal action. The accused has not issued any legal notice to the complainant stating that 16 C.C.No.3188/2018 he and his motherinlaw Arivu Kannu have misused the cheques and filed false complaint against the accused. So it is clear that the conduct of the accused is not of a prudent man. Moreover, the accused has deliberately not entered into witness box to avoid facing extensive cross examination by the complainant with regard to the stand taken by him. So, I am of the opinion that the accused by not leading defence evidence and not eliciting anything in the cross examination of PW1 failed to rebut the presumption under Section 138 of Negotiable Instruments Act.
20. Moreover the important documents are Ex.P13 and Ex.P14. The Ex.P13 is in Tamil language whereas its true translation is in English language. In the said Ex.P13 and Ex.P14 both complainant and accused have entered into an agreement where by accused agreed to return Rs.6,00,000/ by way of three cheques Nos.526109, 526110 and 526111 of Rs.2,00,000/ each belonging into Syndicate Bank, Sipcot2. It is true that as per agreement it appears that those cheques were given as a security and they were given on March 7, 2017 17 C.C.No.3188/2018 which were to be returned to accused after 11 months after return of Rs.6,00,000/. So it appears that they were given as a security. However it is to be noticed that it is the case of the accused that those cheques were stolen by the complainant. However it is to be noticed that it is the case of the accused that those cheques were stolen by the complainant. But Ex.P13 and Ex.P14 improbablise the case of the accused. According to Ex.P13 and Ex.P14 it is abundantly clear that the cheques were given with regard to the liability of repayment of the Rs.6,00,000/. So according to Ex.P13 and Ex.P14 the liability of Rs.6,00,000/ is established. For repayment of said amount the cheque Ex.P1 to Ex.P3 were issued which cannot be found fault with. Moreover the accused has not stated anything as to under what circumstances the Ex.P.13 and Ex.P14 were written. In this regard no defence evidence is led. Under such circumstances I am of the opinion that from the available material on record it is clear that the complainant has established his case to the satisfaction of the court and the accused has failed to rebut the presumption under 139 of Negotiable Instruments Act.
18 C.C.No.3188/2018
21 Hence, considering all these aspects, I am of the opinion that the complainant has proved his case to the satisfaction of the court. On the other hand the accused has failed to rebut the presumption under section 139 of Negotiable Instruments Act. Under such circumstances accused is liable for conviction. Accordingly I, answer point No.1 in the Affirmative.
22. Point No.2: In view of my findings on the above point and the reasons stated therein, I proceed to pass the following:
ORDER Acting u/Sec.255 (2) of Cr.P.C., the accused is hereby convicted for the offence punishable u/Sec. 138 of N.I.Act.
The accused is sentenced to pay a fine of Rs.10,00,000/ (Rupees Ten Lakhs only), in default accused shall undergo simple imprisonment for 3 (three) months.
Out of fine amount, a sum of Rs.9,90,000/(Rupees Nine Lakhs and Ninety Thousand only) shall be paid to the complainant after appeal period is over. Remaining fine amount of Rs.10,000/ shall be forfeited to State.
The bail bonds and surety bonds of the accused stand cancelled.
19 C.C.No.3188/2018
Office to furnish free copy of the Judgment to the accused forthwith.
(Dictated to the Stenographer, transcript thereof is computerized and print out taken by him is verified and then pronounced by me in the Open Court on this the 02 day of January, 2020) (MADHVESH DABER) XIX ADDL.C.M.M., Bengaluru.
ANNEXURE:
Witnesses examined on behalf of the Complainant:
PW.1 Mr.S.JAGANATHAN.
Witnesses examined on behalf of the Accused:Nil Documents marked on behalf of the Complainant:
Ex.P.1 to Ex.P.3 Cheques. Ex.P.1(a) to Ex.P.3(a) Signatures of the Accused. Ex.P.4 to Ex.P.6 Bank Endorsements. Ex.P.7 Office copy of the legal notice. Ex.P.8 Courier receipt. Ex.P.9 & Ex.P.10 Courier receipt and Delivery Run Sheet. Ex.P.11 Partnership Deed. Ex.P.12 Authorisation Letter. Ex.P.13 Original copy of MOU in Tamil Language. Ex.P.14 Translate Copy. Ex.P.15 Partnership Registration Certificate.
Documents marked on behalf of the Accused: Ex.D.1 Deed of Partnership. Note: Ex.D.1 confronted to PW.1 in the cross examination.20 C.C.No.3188/2018
(MADHVESH DABER) XIX ADDL.C.M.M., Bengaluru.21 C.C.No.3188/2018
02.01.2020 Judgment (Judgment pronounced in the open court vide separate order) ORDER Acting u/Sec.255 (2) of Cr.P.C., the accused is hereby convicted for the offence punishable u/Sec. 138 of N.I.Act.
The accused is sentenced to pay a fine of Rs.10,00,000/ (Rupees Ten Lakhs only), in default accused shall undergo simple imprisonment for 3 (three) months.
Out of fine amount, a sum of Rs.9,90,000/(Rupees Nine Lakhs and Ninety Thousand only) shall be paid to the complainant after appeal period is over. Remaining fine amount of Rs.10,000/ shall be forfeited to State.
The bail bonds and surety bonds of the accused stand cancelled.
Office to furnish free copy of the Judgment to the accused forthwith.
(MADHVESH DABER) XIX ADDL.C.M.M., Bengaluru.
22 C.C.No.3188/2018************ Corrected************