Bangalore District Court
Sri. M.N. Sridhar vs M/S. Sneha Developers on 4 November, 2019
THE COURT OF THE XVI ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE, BENGALURU
CITY
i.Dated:- This the 4th day of November, 2019
Present: Sri.S.B.HANDRAL, B.Sc., L.L.B(SPL).,
XVI Addl.C.M.M., Bengaluru City.
JUDGMENT U/S 355 OF Cr.P.C.,
Case No. : C.C.No.20211/2014
Complainant : SRI. M.N. SRIDHAR,
S/o. Late M.L. Narayana
Sastry,
Aged about 46 Years,
"Sri Nilayam" No. 68, 1st Main,
6th Block, 3rd Stage, 3rd Phase,
Banashankari,
BENGALURU 560085.
(Rep. by Sri. Sandeep Patil,
Adv.,)
- Vs -
2 C.C.No.20211/2014 J
Accused : M/S. SNEHA DEVELOPERS,
Represented by Authorized
Signatory,
Sri. N.S. Mukunda,
S/o. Late N.S. Rao,
Aged about 65 Years,
No. 372, 1st Floor,
M.K. Puttalingaiah Road,
Padmanabhanagara,
BENGALURU 560070.
(By Sri. Ajay. T, Adv.,)
Case instituted : 16.04.2014
Offence complained : U/s 138 of N.I Act
of
Plea of Accused : Pleaded not guilty
Final Order : Accused is convicted
Date of order : 04/11/2019
JUDGMENT
The Complainant has filed this complaint against the Accused for the offence punishable u/Sec.138 of the Negotiable Instruments Act.
2. Briefly stated the case of the Complainant is that, the accused had given advertisement in the newspaper inviting the attention of the prospective site purchasers with lucrative offers and he was in search of purchase of residential site with all 3 C.C.No.20211/2014 J approvals from the government departments, in that connection he approached the accused and had discussion with him about the project and on the assurance given by the accused himself and the accused have entered into MOU on 04.07.2007 with various terms and conditions complied with by both parties to the said MOU. It is further contended that after entering into MOU he had chosen to purchase a site measuring 30x40 and the total sale consideration amount agreed upon was Rs.4,62,000/- at Rs.385/- per sq.ft, accordingly he paid a sum of Rs.10,000/- on 20.06.2007 as initial advance towards sale consideration and on 16/06/2007 has paid sum of Rs.50,000/- through a post dated cheque bearing No.259409 dated 04.07.2007 and on 21.06.2007 paid a sum of Rs.50,000/- through an another cheque bearing No.259410 dated 04.07.2007 both cheques are drawn on central bank of India Branch, Kathriguppe Branch, Bangalore and on 30.07.2007 paid a sum of Rs.28,500/- through an another cheque bearing No.889035 dated 30.07.2007 and on 07.08.2010 paid a sum of Rs.46,300/- through another cheque bearing No.889038 dated 07.05.2007 drawn on SBI, Padmanabhanagar Branch, Bangalore and on 07.05.2007 paid a sum of Rs.10,000/- through an 4 C.C.No.20211/2014 J another cheque bearing No.889042 dated 07.05.2007 drawn on SBI, Padmanabhanagar Branch, Bangalore, in all has paid a sum of Rs.1,94,800/- and all the said payment have been duly receipted by the accused. It is further contended that after paying the said amount the accused failed to allot the site as agreed by the terms of the MOU dated: 04/07/2007 nearly 7 years dodged the issue of allotting the site for registration though he is ready and willing to purchase the site and later development showed that the project which was sought to be completed suffered with bottle necks and for want of necessary clearances from the competent authority as well as the court litigations. The complainant had exchanged number of E-mails seeking complete the project and hand over the site to him for registration and expressed his desire but the accused went to give lame excuses all the times which compelled him to ask for return and after due deliberations, the accused finally agreed to returned amount with interest to the tune of Rs.3,03,156/- to him, accordingly, the accused issued a cheque bearing No. 196966 dated: 02/01/2014 for a sum of Rs.3,03,156/- drawn on State Bank of Hyderabad in his favour. It is further contended that, as per the SMS request made by the accused, he has presented 5 C.C.No.20211/2014 J the said cheque for encashment through his banker i.e., Central Bank of India, Kathriguppe Branch, Banashankari on 03/03/2014, but the said cheque was returned dishonoured with shara of "Exceeds Arrangements". Thereafter, the complement had sent E-mail on the same day i.e., 03/03/2014 by expressing his dissatisfaction about the conduct of the accused and demanded the payment of the dishonoured cheque amount by way of Demand Draft, he once again on 04/03/2014 in reply to the accused's SMS furnished his account details inorder to transfer the funds directly to his Bank account. The accused on 05/03/2014 has sent an E-mail reply to the demand request sent by him dated:
03/03/2014 through E-mail, by expressing the problems faced by accused to refund the amount by admitting that he would certainly repay the amount to him with in 7 days intervals, even after passage of the time sought by the accused there was no signs of any payment to him, he has thus waited as per his request to receive the payments and once again he contacted the accused through phone, but there was no reply from accused. Hence, he has finally approached the court by filing the present complaint against the accused for the offense punishable U/sec. 138, 142 of the Negotiable Instruments Act, 6 C.C.No.20211/2014 J R/w sec. 420 of IPC.
3. Before issuing process against the accused, the Complainant has filed his affidavit-in-lieu of his sworn statement along with original documents, in which, he has reiterated the averments of the complaint.
4. Prima-facie case has been made out against the accused and summons was issued against the accused in turn he has appeared before the court and got enlarged on bail and the substance of the accusation has been read over to him, to which he pleaded not guilty and claims to be tried.
5. Thereafter the complainant himself examined as PW.1 by filing affidavit in lieu of examination in chief and in support of his oral evidence, has relied upon the documentary evidence as per Ex.P.1 to P.37 i.e, the Original Cheque, dated:-02/01/2014 as per Ex.P.1, the signature on the said cheque identified by P.W.1 as that of the accused as per Ex.P.1(a), Bank Memo as per Ex.P2, MOU dated: 04/07/2007 is as per Ex.P3, Five Original receipts marked as Ex.P4 to P8 respectively, E-mail copy dated: 03/03/2014 as per Ex.P9, E-mail 7 C.C.No.20211/2014 J copy dated: 05/03/2014 as per Ex.P10, Copies of E-
mails dated: 04/03/2014, 28/02/2014, 03/03/2014, 04/03/2014, 05/03/2014, 06/03/2014, 07/03/2014, 08/03/2014, 09/03/204, 10/03/2014, 13/03/2014 and 15/03/2014 are marked as Ex.P11 to P36 respectively. Certificate filed by the complainant U/s.65-B of the Indian Evidence Act in support of E- mails, marked as Ex.P37 and closed his side.
6. Thereafter, the statement of the accused as required under Sec.313 of the Cr.P.C. has been recorded. He has denied the incriminating evidence appearing against him and has not chosen to lead his evidence.
7. Heard the arguments of both learned counsels for the complainant and the accused and perused the materials on record produced by the both complainant and accused.
8. On the basis of complaint, evidence of complainant and documents and having heard the arguments of both learned counsels for the complainant and the accused, the following points 8 C.C.No.20211/2014 J that are arise for consideration are:-
1. Whether the complainant proves that the accused has issued a cheque i.e. cheque for Rs.3,03,156/- bearing No.196966, dated:- 02/01/2014 drawn on State Bank of Hyderabad, Banashankari 3rd Stage, Bangalore to discharge legally recoverable debt to the complainant and when the complainant has presented a cheque for encashment through his banker but the said cheque has been dishonoured for the reasons "Exceeds Arrangements" on 03/03/2014 and the complainant issued demand notice to the accused on 03/03/2014 through E-
mail and inspite of it the accused has not paid the cheque amount within prescribed period there by the accused has committed an offence U/s.138 of the Negotiable instruments Act?
2. What Order?
9. The above points are answered as under:
Point No.1: In the Affirmative Point No.2: As per final order for the following:
REASONS 10 Point No.1 : Before appreciation of the facts and oral and documentary evidence of the 9 C.C.No.20211/2014 J present case, it is relevant to mention that under criminal jurisprudence prosecution is required to establish guilt of the Accused beyond all reasonable doubts however, a proceedings U/s.138 of N.I.Act is quasi criminal in nature. In these proceedings proof beyond all reasonable doubt is subject to presumptions as envisaged U/s.118, 139 and 136 of N.I.Act. An essential ingredient of Sec. 138 of N.I.Act is that, whether a person issues cheque to be encashed and the cheque so issued is towards payment of debt or liability and if it is returned as unpaid for want of funds, then the person issuing such cheque shall be deemed to have been committed an offence. The offence U/s.138 of N.I. Act pre-supposes conditions for prosecution of an offence which are as under:
1. Existence of legally enforceable debt or liability and issuance of cheque in discharge of said debt or liability;
2. Cheque shall be presented for payment within specified time i.e., from the date of issue before expiry of its validity.
3. The holder shall issue a notice demanding payment in writing to the drawer within one month from the date of receipt of information of the bounced cheque and 10 C.C.No.20211/2014 J
4. The drawer inspite of demand notice fails to make payment within 15 days from the date of receipt of such notice.
If the above said conditions are satisfied by holder in due course gets cause action to launch prosecution against the drawer in respect of bounced cheque and as per Sec.142(b) of the N.I. Act, the complaint has to be filed within one month from the date on which cause of action arise to file complaint.
11. It is also one of the essential ingredients of Sec. 138 of N.I.Act that, a cheque in question must have been issued towards legally recoverable debt or liability. Sec.118 and 139 of N.I.Act envisages certain presumptions i.e.,U/s.118 a presumption shall be raised regarding 'consideration' 'date' 'transfer' 'endorsement' and holder in course of Negotiable Instrument. Even Sec.139 of the Act are rebuttable presumptions shall be raised that, the cheque in question was issued regarding discharge of a legally recoverable or enforceable debt and these presumptions are mandatory presumptions that are required to be raised in cases of negotiable instrument, but the said presumptions are not conclusive and or rebuttable one, this proportion of 11 C.C.No.20211/2014 J law has been laid down by the Hon'ble Apex Court of India and Hon'ble High Court of Karnataka in catena of decisions.
12 In the present case the complainant has got examined as PW.1 by filing his affidavit evidence, wherein he reiterated the entire complaint averments. The complainant/PW.1 in his evidence testifiede that, accused had published in the news papers inviting the site purchasers with lucrative offers and he approached the accused and after discussion and on assurance of accused he entered into a MOU with accused on 04/07/2007 on various terms and conditions. The PW.1 has also testified that, after entering into MOU he decided to purchase site measuring 30X40 for total sale consideration of Rs.4,62,000/- @ Rs.385 per Sq.Ft., accordingly he has paid Rs.10,000/- on 20/06/2007 as initial advance amount, and on 16/06/2007 issued one post dated cheque dated. 04/07/2007 bearing No.259409 for Rs.50,000/- and on 21/06/2007 issued cheque dated 04/07/2007 bearing No.259410 for Rs.50,000/- both are drawn on central bank of India Kathriguppe Branch and on 30/07/2007 issued another cheque bearing No.889035 for Rs.28,500/- and on 07/08/2007 has 12 C.C.No.20211/2014 J issued another cheque bearing No.889038 for Rs.46,300/- both are drawn on SBI Padmanabhanagar Branch and has paid Rs.10,000/- by way of cheque bearing No.889042 on 07/05/2007 drawn on SBI Padmanabhnagar Branch in all, he has paid Rs.1,94,800/- and same has been duly receipted by the accused. The complainant/PW.1 further testified that, the accused has failed to allot the site as agreed upon in terms of the MOU dt.04/07/2007 and has dodged the issue of allotting nearly for 7 years, though he is ready and willing to purchase the site, but for want of necessary clearance from the competent authorities as well as litigation the project was not completed, thereafter he exchanged the mails seeking to complete the project and hand over the sit to him for registration, but the accused went to give same lame excuses which compelled him to ask for return of amount and accused agreed to return of amount with interest to the tune of Rs.3,03,156/- to him. The complainant/PW.1 further testified that, accused issued a cheque in question for Rs.3,03,156/- dt.02/01/2014 and as per SMS request made by accused he has presented the cheque thorugh his banker and said cheque has been dishonoured with endorsement of "EXCEEDS 13 C.C.No.20211/2014 J ARRANGEMENT" vide dt.03/03/2014 and thereafter on 03/03/2014 he had sent E-mail expressing his dissatisfaction and demand the payment of cheque amount by way of demand draft and on 04/03/2014 has furnished account details for transferring funds as requested by accused. The complainant/PW.1 further testified that, the accused had gave E-mail reply to the demand request sent by him dt.03/03/2014 by expressing his problems faced for refund the amount by admitting to return the amount by requesting time i.e. within 7 days, but the accused inspite of time granted but he did not pay the amount.
13. In support of oral evidence the complainant/PW.1 has produced documents, i.e. original cheque dt.02/01/2014, is at Ex.P.1 and Bank memo is at Ex.P.2, MOU is at Ex.P.3, five receipts wich are at Ex.P.4 to 8 and copy of E-mails demand sent by complaint on 03/03/2014 is at Ex.P.9 and reply given by accused dt.05/03/2014 is at Ex.P.10 and copy of E-mail dt.04/03/2014 is at Ex.P.11, copy of E-mail dt.28/02/2014 is at Ex.P.12, 3 copies of E-mail dt.03/03/2014, at Ex.P.13 to 15, 3 copies of E-mail at 04/03/2014 at Ex.P.16 to 18, 5 copies of E-mail dt.05/03/2014 are at Ex.P.19 to 23.
14 C.C.No.20211/2014 JFour E-mail copies dated 06/03/2014 marked as Ex.P.24 to 27, two E-mail copies dated 07/03/2014 marked as Ex.P.28 and 29, copy of the E-mail addressed to accused dated 08/03/2014, 09/03/2014 marked as Ex.P.30 and 31, copies of the E-mail sent by accused dated 10/03/2014 and 13/03/2014 marked as Ex.P.32 to 34, copies of E- mail sent by the complainant to the accused dated 13/03/2014 are at Ex.P.35 and 36 and certificated filed U/s.s.65/(B) of Evidence Act is at Ex.P.37.
14. In the present case the accused has admitted that, the cheque in dispute i.e. Ex.P.1 belongs to his account and signature in cheque i.e. Ex.P.1(a) is that of his signature. The accused has also not disputed that, the cheque in dispute has been presented to the bank for encashment and it has been dis-honoured for the reason of "Exceeds Arrangement" as per bank memo i.e. Ex.P.2 dt.03/03/2014. Therefore it is a matter on record and has been proved that, the cheque in dispute was presented within its validity period and dishonoured as per the bank endorsement issued by the accused bank. The accused has also not disputed the complainant has sent E-mail on 03/03/2014 by making demand of dishonoured cheque amount 15 C.C.No.20211/2014 J which was presented on 03/03/2014 as per Ex.P.9. The accused has also not disputed that, as per Ex.P.10 he has issued reply to the complainant's E- mail dt.03/03/2014 by admitting his libility to pay the cheque amount by expressing his problems to repay the said amount with a request to pay the same within 7 days intervals.
15. The learned counsel for accused during the course of argument has specifically argued that, the complainant in the cross examination has admitted that, he has not issued notice through advocate after dishonour of the cheque in dispute, hence the complaint filed by the complainant is not maintainable in view of non compliance of the Sec.138(b) of NI Act, only on that ground complaint has to be dismissed. It is also argued that, the complainant has produced copies of E-mails which are at Ex.P.9 to 36 and affidavit of complainant is filed U/s.s.65(B) of Indian Evidence Act but the complainant has not filed certificate as required U/s.s.65(B) of Evidence Act and has not filed certificate of the person who maintained the main server of the computer through which the communications have been made in respect of computerized copies of the E-mail correspondences 16 C.C.No.20211/2014 J produced by the complainant, hence the E-mail correspondences copies produced by the complainant are not admissible in the evidence and cannot be taken into consideration to decide the issue in question and complainant has not complied Sec.138(b) of NI Act and complaint is not maintainable.
16. It is true that the complainant in his cross examination has admitted that, after dishonour of cheque, he has not issued demand notice through advocate. But the complainant has specifically stated that, he had issued demand notice through E-mail and produced computerized copy of E-mail dt.03/03/2014 i.e. marked in Ex.P.9. It is relevant mention that, the accused has not disputed the demand made by the complainant through E-mail dt.03/03/2014 in request of dishonoured cheque amount and the accused has also not disputed the Ex.P.10 i.e. reply given by him through E-mail to the demand made by the complainant E-mail dt.03/03/2014 by admitting his liability to repay the cheque amount and requested 7 days time. Hence in view of admitted facts of the accused it can be held that, the accused has admitted that, the complainant has demanded the dishonoured cheque 17 C.C.No.20211/2014 J amount on 03/03/2014 i.e. on the same date of dishonour of cheque in dispute and same has been received by the accused. Hence the complainant has proved that, immediate after dishonur of cheque in dispute i.e. Ex.P.1 has demanded the cheque amount within 30 days from the date of its dishonour as per Sec.138(b) of NI Act.
17. Now, it is to be seen that whether after dishonour of the cheque notice is to be issued through advocate is mandatory on the part of holder in due course or whether demand made by the holder in due course by himself through e-mail is sufficient to construed the demand notice as required U/s.138 (b) of the N.I Act. It is settled law that the modes of service of legal notice U/s.s.138 of NI Act is not only limited to register post but the mode of service can also be accepted and valid mode of service of legal notice if the notice or demand made (1) by Courier (2) by Fax, Messenger or (3) by Electronic Mail (E-mail), this proposition of law finds support from the decision of Hon'ble Apex Court of India reported in AIR 1999 SC 1069 in the case "M/s. Sil Import Usa v/s. Maintenances. Exim Aides Silk Expoters". Hence the demand notice must be sent within 30 days from the day of dishonour of the 18 C.C.No.20211/2014 J cheque and its purpose is only to demand payment and inform the issuer that he or she will be prosecuted if payment is not made within 15 days from the date of service of the notice. Therefore law does not mandates a demand notice is required to be sent through a lawyer on the contrary if the letter is written by a person who is holder in due course within 30 days from the date of dishonour of the cheque and the said letter was served on the drawer of the cheque and if the drawer of the cheque has not made payment within 15 days from the date of receipt of the said letter, the holder in due course gets cause of action to file the complaint against the drawer of the bounced cheque. As it is already held in the above that in the present case the complainant as per Ex.P9 made demand of cheque amount through e-mail on 03.03.2014 i.,e on the date of dishonour of the cheque itself and the accused as per Ex.P10 had given reply to the said e- mail, in such circumstances it can be held that the complainant has made demand for payment of dishonoured cheque in writing to the accused i.e., the drawer of the cheque within one month from the date of receipt of intimation as required U/s.s.138(b) of the NI Act, therefore for the said reasons the arguments canvassed by the learned counsel for the 19 C.C.No.20211/2014 J accused cannot be acceptable one.
18. It is true that the complainant has filed his certificate U/s. 65(B) of Indian Evidence Act which is marked as Ex.P37. On careful perusal of the certificate filed by the complainant wherein he has stated that he has produced the copies of E-mail dated 03.3.2014 and 04.03.2014 sent by him to the accused and the reply dated 05.03.2014 given by the accused to his statutory e-mail notice dated 03.03.2014 and 04.03.2014 and the copies of the e- mail correspondences between himself and the accused with its attachments through his E-mail ID i.e., [email protected] to accused E-mail D i.e., [email protected] and he had personally taken print from his computer and certified that the hard copies E-mails produced as true copies of its original. Hence the contents of the certificate filed by the accused by way of sworn affidavit are acceptable as the complainant has complied the statutory requirements as required U/s.65(B) of the Indian Evidence Act. In this regard it is relevant here to refer the decision of Hon'ble Apex Court of India reported in (2014) 10 SCC 473 in the case of "ANVAR P.V V/S P.K.BASHEER AND ORS." Wherein the Hon'ble Apex Court held that Sec.65(B) (4) of 20 C.C.No.20211/2014 J Evidence Act - secondary evidence of electronic record - producing copy of statement pertaining to electronic record in evidence not being the original electronic record - mandatory pre-requirement - held, such statement has to be accompanied by a certificate as specified in section.65-B (4) - essential ingredients of such certificates, enumerated - held in absence of such certificate, secondary evidence of electronic record cannot be admitted in evidence. It is further held at para No.16 of the decision that the person need only to state in the certificate that same is to the best of his knowledge and belief and such certificate must accompany the electronic record like computer print out, compact disc, video compact disc, pen drive etc., pertaining to which a statement is sought to be given in evidence and same is produced in the evidence. Hence by applying the above said principles of law to the present facts of the case in this case also the computerized E-mail copies which are produced by the complainant i.e, demand notice made by the complainant, reply given by the accused and other communications i.e, Ex.P9 to 36 can be taken into consideration as secondary evidence of the electronic record and they are admissible under Evidence Act as the complainant has complied the necessary requirements U/s.65(B) 21 C.C.No.20211/2014 J of Evidence Act.
19. It is also relevant here to mention that in another decision reported in 2018 AIR (SC) 714:2018 (II) SCC 801 in the case of "SHAFHI MOHAMMAD V/S. STATE OF HP " wherein the Hon'ble Apex Court held that Evidence Sec.65(B) (4) - Electronic Evidence - Requirement certificate - to be applied only when electronic evidence is produced by person in position to produce such certificate being in control of said device - where electronic evidence is produced by party not in position of device, sec.63 & 65 of Evidence Act can certainly be invoked - thus requirement of certificate U/s.65(B)(4) not always mandatory. Hence in the present case the complainant has filed his certificate U/s.s.65(B) of Indian Evidence Act in respect of E-mail copies i.e. print out computerized copies of the E-mails produced by him which are taken from his computer i.e. the computer which is in his custody, but as per the principles of law in the above decision, the complainant cannot be complied to produce the certificate of the person who maintain the main server through which the E-mail communications have been made between the complainant and the accused, in such circumstances the argument 22 C.C.No.20211/2014 J canvassed by the learned counsel for the defense that, the E-mail correspondence copies which are produced by the complainant i.e. Ex.P.9 to 36 are not admissible in the evidence as the complainant has failed to produce the certificate of the person who has maintained the main server as required U/s.s.65(B) of the Evidence Act cannot be acceptable one and not sustainable in law as the complainant is not in position to produce such certificate since the said device is not in his control. In such circumstances also the E-mail copies i.e. Ex.P.9 to 36 produced by the complainant are admissible U/s.s.63 and 65 of the Evidence Act.
20. In the present case the complainant has produced the documents i.e. MOU and receipts for having paid the amount to the accused towards purchase of the site as per the terms and conditions of the MOU dt.04/07/2007 which are at Ex.P.3 to 8 respectively. According to the complainant he has agreed to purchase a site measuring 30 X 40 for total sale consideration amount of Rs.4,62,000/-
and he entered into a memorandum of understanding on 04/07/2007 and has paid total amount of Rs.1,94,800/- on various dates by way of cash and also through cheques. The accused in his 23 C.C.No.20211/2014 J defense and during the course of cross examination of complainant has not disputed the execution of MOU as per Ex.P.3 and has also not disputed his signatures appearing at Ex.P.3(b) on MOU and also not disputed the terms and conditions of MOU. The accused has also not disputed the amount received from the complainant through the cheques as mentioned in Ex.P.4 to 8 and issued the said receipts in favour of the complainant by acknowledging the amount received from the complainant and also not disputed his signatures appearing on Ex.P.4 to 8 receipts. Hence on the admitted facts of the accused during the course of cross examination and in view of Ex.P.3 to 8 it can be safely held that, the accused invited the site purchasers with offers, accordingly the complainant approached the accused and after discussion with him about the project and on his assurance, the complainant and accused have entered into a MOU on 04/07/2007 and as per the terms and conditions mentioned in the MOU the complainant has agreed to purchase a site measuring 30 X 40 feet at the rate of Rs.385/- per Sq.Ft. for total sale consideration of Rs.4,62,000/-. It is also seen from MOU i.e. Ex.P.3 that the accused has agreed to provide the said site to the complainant after the payments made by him 24 C.C.No.20211/2014 J as per the terms mentioned therein within Dec.2017. It is also seen from Ex.P.4 to 8 that the complainant has paid a sum of Rs.1,84,800/- by way of cheque and an amount of Rs.10,000/- by way of cash in all an amount of Rs.1,94,800/- towards total sale consideration amount of Rs.4,62,000/-. The accused during the course of cross examination has not denied the amount paid by the complainant to him as per Ex.P.4 to 8 and an amount of Rs.10,000/- by way of cash, hence in view of the said admitted fact the complainant has proved that, he has paid an amount of Rs.1,94,800/- to the accused on various dates by way of cheque and also cash as stated in his evidence.
21. It is also relevant here to mention that, the accused has not disputed the cheque in dispute i.e. Ex.P.1 was issued by him in favour of the complainant and also not disputed his signature on the cheque i.e. Ex.P.1(a). Hence it goes to show that, the accused has admitted the issuance of cheque in favour of the complainant and even it is not the defense of the accused that, he has issued blank signed cheque to the complainant and same has been got written by the complainant as per his whims and fancies and presented the said cheque 25 C.C.No.20211/2014 J for encashment by misusing the same. The learned counsel for the accused in the argument contended that, the complainant has admitted in his cross examination that, he has paid an amount of Rs.1,94,000/- to the accused but the amount mentioned on the disputed cheque is Rs.3,03,356/-, hence the complainant has claimed more than the amount paid by him and there is a difference in amount paid by him to the accused and amount mentioned on the cheque. But the complainant/PW.1 in his cross examination has specifically stated that, though he has paid an amount of Rs.1,94,000/- to the accused but the accused had issued cheque by mentioning the amount on it and the amount mentioned in the cheque includes the interest on the amount paid by him. It is true that, the complainant admitted in his cross examination that, there is no mentioning of payment of interest in the MOU i.e. in Ex.P.3, but the complainant in the cross examination has specifically stated that, the accused has agreed to pay interest at the rate of 10% p.a. to him and if the proposed project has not been completed within Dec.2007 the accused agreed to the return amount received by him along with the interest. Hence the complainant has made it clear that, the accused has 26 C.C.No.20211/2014 J issued the cheque in question towards return of the amount received by him from the complainant along with the interest, therefore the complainant has satisfactorily explained the amount mentioned or claimed by the complainant as per the disputed cheque is more than the amount paid by him towards purchase of the site from the accused. If really the accused has not agreed to pay the interest along with the amount received by him in favour of the complainant, definitely he would have deny the claim made by the complainant through his demand notice i.e. as per Ex.P.3 but the accused though he had given reply to the E-mail sent by the complainant as per Ex.P.3 by demanding the amount mentioned in the disputed cheque i.e. Ex.P.3, has not denied the claim made by the complainant on the contrary in his reply i.e. in Ex.P.10 he has admitted the claim made by the complainant i.e. to return the dishonoured cheque amount and requested the consent of the complainant for 7 days time to return the amount from the date of his consent and also agreed to clear the said amount within 3 weeks, hence as per Ex.P.10 the accused had admitted and acknowledged the receipt of amount paid by the complainant and also issuance of the disputed 27 C.C.No.20211/2014 J cheque i.e. Ex.P.1 and its dishonor and also requested time to return the time covered under the disputed cheque, in such circumstances an adverse inference can be drawn against the accused that, the accused has issued the cheque in dispute i.e. Ex.P.1 for sum of Rs.3,03,156/- in favour of the complainant which includes the amount paid by the complainant towards purchasing the site and also the interest which was agreed by the accused to pay in favour of the complainant. In addition to that there are number of communication made by the complainant with the accused and the accused communicated with the complainant in respect of the payment of dishonored cheque as per Ex.P.11 to 35, but the accused during the course of cross examination has not disputed his reply communications to the complainant, hence it goes to show that, the accused is aware of the amount claimed by the complainant in the dishonoured cheque and the accused has not disputed the amount mentioned in the Ex.P.1 disputed cheque on the contrary by admitting the issuance of the cheque in favour of the complainant has sought time for making alternative financial arrangement to return the cheque amount and requested 7 days time to return the cheque amount, on this count also the 28 C.C.No.20211/2014 J arguments canvassed by the leanred counsel for the accused that, the complainant has claimed more amount than he paid to the accused under disputed cheque in view of that the complaint itself is not maintainable, cannot be acceptable one and not sustainable in law.
22. Hence from careful perusal of the oral and documentary evidence of the complainant and Ex.P.1 to P.36 makes it clear that, the complainant has proved that, the cheque in question i.e. Ex.P.1 was issued by the accused and the signature thereon is that of the accused i.e. Ex.P.1(a), thereafter the complainant demanded the dishonoured cheque amount through E-mail dated 03/03/2014 as per Ex.P.9 and the accused has received in the said E- mail and by admitting the liability to return the cheque amount in dispute and has sought time to return the cheque amount, but the accused did not repay the cheque amount finally the complainant approached the court by filing this complaint. Therefore the complainant has discharged his initial burden casted upon him and a presumption can be drawn in favour of the complainant as available U/s.118 and 139 of N.I Act. Consequently it is for the Accused to rebut the said presumptions and to 29 C.C.No.20211/2014 J show that, the cheque in question was not issued either to the complainant or towards any legally recoverable debt or liability by producing cogent and convincible evidence but not mere suggestions or even plausible explanations. The accused during the course of cross examination of PW.1 has elicited that, there is a difference in the amount piad by him to the complainant and the amount mentioned on the disputed cheque and there is a difference in claim made by the complainant. During the course of argument the learned counsel argued that, in view of the said admissions the complainant has miserably failed to establish that the accused was due of Rs.3,03,156/- as claimed by the complainant in the disputed cheque, therefore the complainant has also failed to establish the existence of legally recoverable debt and as on the date of presentation of the cheque there was no liability was in existence to extent of amount mentioned in the Ex.P.1 cheuqe, in such circumstances the claim made by the complainant is illegal and liable to be dismissed. It is true that, the complainant claimed more than the amount paid by him to the accused, but as it is alredy held in the above that the accused himself admitted that, the issuance of the cheque in favour of the complainant and requested time to return the 30 C.C.No.20211/2014 J cheque amount in such circumstances the arguments of learned counsel for the complainant cannot be acceptable one. Once the accused has admitted issuance of cheque and signature on the cheque, a presumption can be drawn U/s.s.118 and 139 of the NI Act even to the extent of existence of legally enforceable debt or liability. In this regard it is relevant here to refer the decisions reported in 2001 AIR Karnataka HCR 2154 between 'M/s.Devi Tyres V/s.Navab Jan' and in 2011 ACD 1521 (KAR) between 'Smt. Usha Suresh V/s.
Shashidharn', in 2010 SC 1898 between 'Rangappa Vs. Mohan' and 2011 ACD 1412 (KAR) between 'N.Hasainar Vs. M.Hasainar, S/o. Ibrahim'. The Hon'ble High Court of Karnataka in the above decision i.e., 2001 AIR Karnataka HCR 2154 at para No.6 was pleased to hold that issuance of cheque itself was adequate proof of existence of debt or liability. The Hon'ble Apex Court has also held in the decision referred above, the Hon'ble Apex Court in 2010 SC 1898 in case of 'Rangappa Vs. Mohan' that, presumptions U/sec.118(a) and 139 of N.I. Act indeed does extend to the existence of legally recoverable debt, of course the said presumption is rebuttable one, the accused has to rebut the presumption by taking probable 31 C.C.No.20211/2014 J defence. In another decision of Hon'ble Apex court of India reported in CRIMINAL APPEAL NO. 508 OF 2018 DT 15-03-2018 between ROHITBHAI JIVANLAL PATEL Vs STATE OF GUJARAT AND ANR held that "Negotiable Instruments Act facts like source of funds are not relevant if the Accused has not been able to rebut the presumption. It is further held that "When such a presumption is drawn, the facts 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". In another decision of Hon'ble High Court of Karntaka reported in ILR 2019 KAR 493 in the case of Sri.Yogesh Poojary Vs. Sri.K.Shankara Bhat, wherein the Hon'ble High Court held that, the presumption mandated by Sec.139 of N.I Act includes the presumption that, there existed a legally enforceable debt or liability, however such presumption is rebuttable in nature".
23. Hence the above principles of law laid down by the Hon'ble Apex Court of India and High Court of Karnataka in the above referred decisions 32 C.C.No.20211/2014 J are aptly applicable to the case on hand, since in the present case the complainant has proved that, the cheque in question i.e. Ex.P.1 is belonging to the account of the Accused and signature appearing on the cheque i.e. Ex.P.1(a) is also that of the Accused, hence a presumption can be drawn about existence of legally enforceable debt against the Accused as per Sec. 139 of N.I. Act. Therefore under these circumstances the arguments canvassed by the learned counsel for the defence that there was no existence of legally enforceable debt against the accused and complainant has failed to produce any document to prove that there is existence of liability or debt against the accused are not sustainable and acceptable one.
24. The accused during the course of cross examination of complainant has taken specific defense that, there is no mentioning of payment of interest in MOU dated 04/07/2007 and the complainant has claimed more than the amount what he has paid to the accused under the disputed cheque and also taken specific defense that, the complainant has not taken any action against the accused immediate after completion of Dec.2007 as per the terms of MOU. The learned counsel has also 33 C.C.No.20211/2014 J argued that, the amount paid by the complainant in faour of M/s.Sneha Developers in the year 2007 but the said M/s.Sneha Developers was not in existence in the year 2014 itself and the cheque in question issued on behalf of the M/s.Sneha Developers is for the year 2014 in such circumstances the cheque issued by the developer was not in existence as on the date of cheque in dispute on this count also the complaint filed by the complainant is not maintainable. No doubt, the defence version claimed by the Accused could be considered only the accused has rebutted the presumption available U/s.s.118 and 139 of NI Act in favour of the complainant by producing cogent and convinciable evidence. It is settled law that, the accused can rebut the presumption only on the basis of materials produced by the complainant even without entering into the witness box but in the present case the Accused has failed to substantiate his defence version in order to rebut the presumption available to the complainant and to prove the defense of the accused, the accused while recording his statement as required U/s. 313 of Cr.P.C. though he has denied the incriminatory evidence appearing against him but he did not entered in to witness box to prove his defense or rebut the presumption available to the 34 C.C.No.20211/2014 J complainant U/s. 118 and 139 of N.I. Act. Under such circumstance, it is for the accused to disprove the case of the complainant or rebut the presumption then only the onus will be shifted on the complainant to prove his case.
Admittedly the accused did not entered in to the witness box, therefore an adverse inference can be drawn against the accused that he has failed to rebut the presumption available to the complainant. Therefore it is clear that, except having denial of the case of the Complainant in the cross examination of complainant, the Accused has not taken any interest so as to prove his defence. In this regard, it is relevant here to refer a decision of Hon'ble Apex Court of India reported in "AIR 2018 SC 3173 in a case of Kishan Rao Vs. Shankargouda" wherein the Hon'ble Apex Court held as under:-
Negotiable Instruments Act (26 of 1881), Ss. 138, 139- Dishonour of cheque - Presumption as to - Accused issuing cheque of Rs.2 Lakhs towards repayment of loan to Complainant-
said cheque dishonoured on account of insufficiency of 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 35 C.C.No.20211/2014 J mind of Court with regard to existence of loan, improper- Accused, liable to be convicted.
In another decision decided in Crl.Appeal No.1545 of 2019 dt.17/10/2019 by the Hon'ble Apex Court of India in the case of Uttam Ram Vs. Devinder Singh Hudan and Anr. Wherein the Hon'ble Apex Court held that, Dishonor of cheque - Statutory presumption under - burden to prove - the burden is on the accused to rebut the presumption that the cheque was issued not for any debt or other 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 - even a blank cheque leaf, voluntarily signed and handed over by the accused which is towards some payment, would attract presumption U/s. 139 of NI Act - the accused is held guilty of dishonour of cheque for an offence U/s.s.138 of NI Act.
It is also held that, the accused has failed to lead any evidence to rebut the statutory presumption, a finding returned by both the Trial Court and High Court. Both courts not only erred in law but also committed perversity when the due amount is said to be disputed only on the account of discrepancy in the cartons, packing materials or the rate to determine the total liability as if the appellant was proving his debt before the civil court. Therefore it is presumed that, the cheque in question were drawn for consideration and the holder of the cheques received the same in existing debt.
It is also held that, once the agent of the respondent has admitted the settlement of the due amount and in the absence of any other evidence the trial court or High Court could not dismiss the complaint only on account of discrepancies in the 36 C.C.No.20211/2014 J determination of amount due or oral evidence in the amount due when the written document crystallizes the amount due for which the cheque was issued.
The principles of law laid down in the above decision are aptly applicable to the case on hand, since in this case also the complainant proved the fact of payment of the amount of Rs.1,94,800/- to the accused and the accused in turn issued cheque for discharge of the said amount with interest as per Ex.P.1. It is also proved by the complainant that, the accused has admitted the liability to return the cheque amount in his reply i.e. as per Ex.P.10 dated 05/03/2014 and accused has also failed to enter into witness box to rebut the statutory presumption in support of his defense in such circumstances the defense taken by the accused counsel during the course of cross examination and argument cannot be acceptable one.
25. It is also important to note here that, the Accused has not denied or disputed that the cheque in question as well as the signatures therein do belong to him and he has failed to explain as to how his cheque has come to the possession of the Complainant, this would also give rise to an adverse inference against him. This preposition of law finds support from the decisions of Hon'ble High Court of 37 C.C.No.20211/2014 J Karnataka reported in 2010(1) KCCR 176 in the case of "Siddappa Vs. Manjappa". In another decision of Hon'ble Apex court of India decided in Crl.A.No.664 of 2012 dated: 19.9.2019 in the case of "M.Abbas Haji Vs. T.M.Chennakeshava"
held that, " the Accused has to explain how the cheque entered into the hands of complainant".
Hence in the present case also the Accused has failed to explain how the cheque in question was entered into the hands of complainant. Therefore for the above said reasons the defense taken by the accused cannot be acceptable one and accused has measearably failed to rebut the presumption available in favour of the complainant by adducing cogent and convincible evidence.
26. Therefore considering all these aspects of the case and totality of the circumstances and on careful and meticulous appreciation of evidence adduced on behalf of the complainant the complainant has successfully established beyond all reasonable doubt that, he has paid a sum of Rs.1,94,800/- to the accused by way of cheques and cash towards purchase of the site as per MOU and the accused in turn has issued cheque in question i.e. Ex.P.1 to the complainant towards return of the 38 C.C.No.20211/2014 J amount paid by the complainant along with the interest as agreed by him and thereafter the complainant has presented the said cheque through his banker and same was returned dishonoured with an endorsement of "Exceeds Arrangement" and thereafter he got issued demand letter through E- mail on 03/03/2014 to the accused and inspite of receiving the said letter and promise made by the accused to return of cheque amount in dispute the Accused did not paid the said amount, hence the complainant filed the present complaint against the accused. On the other hand, the accused has failed to rebut the presumption available infavour of the complainant with regard to the existence of legally recoverable debt under Ex.P.1 Cheque. Therefore accused has committed an offence punishable U/s.138 of N.I. Act, accordingly for the above said reasons this point is answered in the Affirmative.
27. Point No.2: Negotiable Instrument Act was enacted to bring credibility to the cheque and the very purpose of enactment is to promote the use of negotiable instrument, while to discourage the issuance of cheque without having sufficient funds in their accounts. Such being the case the intention of the legislature is that, complainant be suitable 39 C.C.No.20211/2014 J compensated while accused be punished for his act. Hence while awarding the compensation the said fact is to be kept in mind and suitable compensation is awarded to the complainant certainly it will not cause injustice to the accused, accordingly the complainant is entitled for the compensation as ordered by the court and for the said reasons, it is just and proper to pass the following :-
ORDER Acting U/sec.255(2) of Cr.P.C. the accused is convicted for the offence punishable U/sec.138 of N.I.Act.
The accused is sentenced to pay a fine of Rs.3,20,000/= (Rupees Three Lakhs and Twenty Thousand only) within one month from the date of order, in default he shall under go simple imprisonment for a period of (3) three months for the offence punishable U/sec.138 of N.I.Act.
Further acting U/sec.357(1) of Cr.P.C. out of the fine amount on recovery, a sum of Rs.3,15,000/= (Rupees Three Lakhs and Fifteen Thousand only) shall be paid as compensation to the complainant.
Further acting U/sec.357(1)(a) 40 C.C.No.20211/2014 J of Cr.P.C. out of fine amount on recovery a sum of Rs.5,000/= (Rupees Five Thousand only) shall be defrayed as prosecution expenses to the state.
The Bail bond and surety bond of Accused stands cancelled.
Office is directed to furnish free certified copy of this judgment to the Accused incompliance of Sec.363(1) of Cr.P.C.
(Directly dictated to the stenographer online, printout taken by her, verified, corrected and then pronounced by me in the open Court on this the 4th day of November 2019).
(S.B. HANDRAL), XVI ACMM, Bengaluru.
ANNEXURE
1. List of witness/s examined on behalf of the Complainant:-
P.W.1 : M.N. SRIDHAR
2. List of documents exhibited on behalf of the Complainant:-
Ex.P-1 : Original Cheque
Ex.P-1(a) : Signature of the Accused
Ex.P-2 : Bank Memo
Ex.P-3 : MOU dated: 04/07/2007
Ex.P-4 to 8 : Five Original receipts
Ex.P-9 : E-mail copy dated:
41 C.C.No.20211/2014 J
03/03/2014
Ex.P-10 : E-mail copy dated:
05/03/2014
Ex.P-11 to 36 : Copies of E-mails dated:
04/03/2014, 28/02/2014, 03/03/2014, 04/03/2014, 05/03/2014, 06/03/2014, 07/03/2014, 08/03/2014, 09/03/204, 10/03/2014, 13/03/2014 and 15/03/2014.
Ex.P37 : Certificate U/s 65-B of the
Indian Evidence Act.
3. List of witness/s examined on behalf of the Accused:-
Nil
4. List of documents exhibited on behalf of the Accused:-
Nil (SRI.S.B.HANDRAL), XVI ACMM, Bengaluru.42 C.C.No.20211/2014 J
04.11.2019 Judgment pronounced in the open court vide separate order.
ORDER Acting U/sec.255(2) of Cr.P.C. the accused is convicted for the offence punishable U/sec.138 of N.I.Act.
The accused is sentenced to pay a fine of Rs.3,20,000/= (Rupees Three Lakhs and Twenty Thousand only) within one month from the date of order, in default he shall under go simple imprisonment for a period of (3) three months for the offence punishable U/sec.138 of N.I.Act.
Further acting U/sec.357(1)
of Cr.P.C. out of the fine amount
on recovery, a sum of
Rs.3,15,000/= (Rupees Three
Lakhs and Fifteen Thousand
only) shall be paid as
compensation to the complainant.
Further acting
U/sec.357(1)(a) of Cr.P.C. out of
fine amount on recovery a sum of
Rs.5,000/= (Rupees Five
Thousand only) shall be
defrayed as prosecution
expenses to the state.
The Bail bond and surety
bond of Accused stands
cancelled.
43 C.C.No.20211/2014 J
Office is directed to furnish
free certified copy of this
judgment to the Accused
incompliance of Sec.363(1) of
Cr.P.C.
XVI ACMM, B'luru.