Bangalore District Court
Sri. Vijayakumar.L vs Sri. C.Sunil Kumar on 24 September, 2020
BEFORE THE LXVI ADDL.CITY CIVIL & SESSIONS
JUDGE, BENGALURU CITY.
(CCH-67)
DATED: This the 24 th day of September 2020
PRESENT
Smt. K.KATHYAYANI, B.Com., L.L.M .,,
LXVI Addl.City Civil & Sessions Judge,
Bengaluru.
Criminal Appeal No.2383 of 2018
Appellant: Sri. Vijayakumar.L.
S/o Sri.N.Lakkanna,
Aged about 35 years,
Maruthappa Flour Mill,
I Main, Kempegowda Nagar,
T.Dasarahalli,
Bengaluru - 560 057.
(By Sri.G.Shankar, Adv.)
/Vs/
Respondent : Sri. C.Sunil Kumar,
S/o late Chamaraj,
Aged about 37 years,
R/at No.154, I Floor, 7th Cross,
RHCS Layout,
Annapoorneshwarinagar,
Nagarabhavi II Stage,
Bengaluru 560 072.
(By Sri.SSG,Adv.)
JUDGMENT
The appellant/accused has preferred this appeal against the respondent/complainant under Section 374 2 Crl.A.No.2383/2018 read with Section 382 of Cr.P.C. being aggrieved by the judgment of conviction passed in CC.No.20558/2016 dated 27.10.2018 by the learned XXVI ACMM, Bengaluru.
2. For the sake of convenience, the ranks of the parties are retained as they are before the learned Magistrate Court.
3. The brief facts of the case are that;
a) The complainant has brought this complaint against the accused on the allegations that the accused had borrowed a loan of Rs.27,00,500/- from him to improve his/the accused's business on the different occasions and on several dates through bank and also by way of cash.
b) Towards the security of the said amount, the accused had issued 4 post dated cheques. The accused made payment of Rs.10,57,000/- on different dates towards repayment of the said amount.
c) The accused had issued three cheques for Rs.4,50,000/-, Rs.40,000/- both dated 10.06.2014 and the 3rd cheque bearing No.389323 for Rs.5,00,000/- and all the said cheques when presented for encashment, returned 3 Crl.A.No.2383/2018 dishonoured. But no action was taken against the said dishonour.
d) The 4th cheque bearing No.389324 dated 14.12.2015 being issued for an amount of Rs.16,43,500/- was also dishonoured on 18.12.2015 for 'insufficient funds'.
e) In this regard, he gave a police complaint on 13.12.2013 and the accused, instead of paying the amount, got issued legal notice dated 08.08.2015 which has been duly replied by him on 26.11.2015. The accused informed him to present the cheque. But, the same was dishonoured. Accordingly, the private complaint was filed by him.
4. The trial Court record reveals that;
a) On receipt of the complaint, the learned Magistrate was pleased to record the sworn statement of the complainant and on satisfaction, has taken cognizance against the accused for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short, "the Act") and issued summons to the accused. 4
Crl.A.No.2383/2018
b) In response to the due service of summons, the accused appeared through his counsel and was enlarged on bail.
c) Plea of the accused was recorded for the offence alleged for which, he pleaded not guilty and claimed to be tried.
d) Hence, the matter was posted to record the evidence of the complainant. In response to which, the complainant himself entered into the witness box as PW-1. Got exhibited 21 documents at Ex.P-1 to 21 and closed his side.
e) The statement of the accused under Section 313 of Cr.P.C., was recorded wherein he has denied all the incriminating evidence against him and in support of his defence, in the course of cross-examination of the complainant, got exhibited Ex.D.1 and he himself stepped into the witness box as DW-1. Got exhibited 3 documents at Ex.D-2 to 4, thus, totally 4 documents and closed his side.
f) The learned Magistrate, after hearing the arguments of both sides on merits of the case and going 5 Crl.A.No.2383/2018 through the evidence on record, has passed the impugned judgment convicting the accused for the offence punishable under Section 138 of the Act and sentenced accordingly.
5. Being aggrieved by the above judgment of conviction, the accused has approached this Court with the following grounds.
a) The judgment passed by the trial Court is unsustainable in law, vague, without application of mind and evidence on record.
b) The judgment is passed without considering the admitted facts and circumstances of the case. Hence, suffers from material irregularity and biased and liable to be set aside.
c) The impugned judgment is not a speaking order and is liable to be set aside.
d) He has submitted the written arguments. Although the trial Court took the same on record, none of the grounds raised in the written arguments were discussed in the impugned judgment and given specific finding. 6
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(i) The trial Court has made observations only by magnifying the facts stated by the complainant and in drawing the presumption under law.
(ii) The depositions and exhibits produced by him with specific view points were not discussed.
(iii) The nature of documents produced by him keeping in mind the admitted facts by the complainant in the trial have not at all been discussed. Hence, the written arguments filed in the trial Court is to be considered as grounds for this appeal.
e) While relying on the reported decisions of the superior Courts, the trial Court has not considered the exact gist of the judgments and given a blank and vague findings on the point of law with regard to presumption and rebuttal evidence and more particularly, the company and individual transactions.
f) The complainant himself has given complaint before the police against him seeking certain sum of money with reference to certain loan agreement. The notices and reply also disclose the number of cheques and the actual loan transaction taken place between the parties. The trial 7 Crl.A.No.2383/2018 Court has only mentioned about few defence without analyzing its impact on the merits of the case and has not given specific findings. He has filed a private complaint against the complainant which is still pending.
g) The trial Court has misguided itself with regard to income tax returns submitted by both of them and went on observing something else than the actual points involved in the income tax returns.
h) Viewed from any angle, there is no cause of action to file the complaint.
i) The presumption with regard to liability is rebutted and there is no legally enforceable debt between him and the complainant. Much reliance is placed on reported decisions which are not applicable to the case on hand. The principles of rebuttal evidence by preponderance of probabilities are not considered in the case. Hence, prayed this Court to set aside the judgment of conviction and sentence passed and acquit him in the interest of justice and equity.
6. Heard the respective counsels for both parties on merits of the case.
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7. The counsel for the complainant has relied on the following citations and produced the online print outs of the same.
1) (2011)4 SCC 275 in Milind Shripad Chandurkar Vs Kalim.M.Khan & Another.
2) (2009) 2 SCC 513 Kumar Exports Vs Sharma Carpets
3) KAR 2017(1)102 HC Shashidar Raj Vs Dr.Joshie Pereira
8. On the basis of the grounds made out, the following points are arisen for the determination of this Court.
1) Whether the accused/appellant proves the grounds urged by him in support of this appeal?
2) Whether the impugned judgment requires interference by this Court?
3) What Order?
9. The findings of this Court on the above points are answered in the;
1) Point No.1 : Partially affirmative.
2) Point No.2 : Affirmative.
3) Point No.3 : As per the final order for the following reasons.
9
Crl.A.No.2383/2018 REASONS
10. POINTS Nos.1 AND 2:- Since the findings on point No.2 is consequential to the findings on point No.1, these points are taken together.
11. The trial Court record demonstrates that the defence taken by the accused is that;
a) In the year 2013 since, he was in need of money, he raised loan from the complainant during December- 2013 and by that time, for the security purpose, the complainant had received 2 signed unfilled cheques and an agreement.
b) The said agreement was got prepared by the complainant and he had signed it. Ex.P-1 cheque pertains to the said agreement. He had repaid the said amount with interest at 3% per month. Since he had no copy of the above agreement, he got it from the complainant who had scanned and mailed to him.
c) Later, since he was in need of Rs.4,00,000/-, he raised loan from the complainant who gave Rs.2,00,000/- each during April and May and repaid the same together with interest at 3% per month from time to time through 10 Crl.A.No.2383/2018 RTGS totally amounting to Rs.10,90,000/-. He had shown the said loan of Rs.9,00,000/- in his tax returns for the year 2014-15.
d) His father paid Rs.70,000/- towards interest by cash and he had also paid interest by cash.
e) On repayment of the loan amount, he demanded for return of the cheque, but the complainant did not and lodged the complaint before the Police Commissioner which was later transferred to CCB, wherein he gave statement that he is not in due of any amount and the complainant agreed the above stated agreement.
f) But, suppressing all the above facts, the complainant has come up with the false complaint by misusing the cheque given for security purpose. Hence, he has lodged a private complaint which is pending on the file of XXV ACMM., Bengaluru.
12. The trial Court record also demonstrates that to prove his case that to open his Firm and carry on business, the accused approached him and he, stage by stage, lent a sum of Rs.27,00,500/- to the accused on 11 Crl.A.No.2383/2018 different occasions through Bank transactions and also in cash, as detailed below, Sl.No. Mode Amount
1. Amount transferred from Rs.14,50,000/-
Canara Bank Account
2. Amount transferred from Rs. 7,93,000/-
Karnataka Bank
3. Amount transferred from Rs. 57,500/-
Karnataka Bank
4. By cash Rs. 4,00,000/-
Total : Rs.27,00,500/-
the complainant, himself has stepped into the witness box as PW-1 and reiterated the above complaint averments.
13. To establish the above payments through bank, the complainant has produced Ex.P-10, 11 and 12, the bank account extract of Canara Bank and the true copies of the pass book of the Karnataka Bank, both Nagarabavi Branch, pertaining to his Firm, i.e., Dharithri Technology, wherein Ex.P-12 shows that the following entries pertain to the accused.
Sl.No. Date Cheque No. Amount
1. 23.01.2014 961504 Rs. 4,00,000/-
2. 30.01.2014 961506 Rs. 2,00,000/-
3. 08.02.2014 961510 Rs. 2,00,000/-
4. 20.03.2014 961524 Rs. 1,00,000/-
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5. 03.04.2014 961527 Rs. 5,00,000/-
Total : Rs.14,00,000/-
14. The above entry at Sl.No.4 for Rs.1,00,000/- is in the name of the accused and all the other entries are in the name of the proprietor concern of the accused, i.e., 7BLUFRAMES, and the total comes less Rs.50,000/- when compared to the payment detailed in the complaint noted above.
15. Ex.P-10 demonstrates that the following entries pertain to the transfer of money in favour of the accused.
Sl.No. Date Cheque No. Amount
1. 08.07.2013 278033 Rs. 25,000/-
2. 12.07.2013 278034 Rs. 50,000/-
3. 25.07.2013 278036 Rs. 50,000/-
4. 06.08.2013 278037 Rs. 45,000/-
5. 09.10.2013 278044 Rs. 43,000/-
6. 21.12.2013 278048 Rs.5,00,000/-
7. 21.12.2013 278050 Rs. 80,000/-
Total : Rs. 7,93,000/-
16. In the above payments, except the payment at Sl.No.6 amounting to Rs.5,00,000/- which was transferred through RTGS to the proprietor concern of the accused, all the other transfers are in the name of the accused and the 13 Crl.A.No.2383/2018 total tallies with the total of payments detailed at Sl.No.2 of the complaint.
17. Ex.P-11 reveals that the following entries pertain to the accused.
Sl.No. Date Cheque No. Amount
1. 30.01.2014 469297 Rs. 7,500/-
2. 14.03.2014 470689 Rs.10,000/-
Total : Rs.17,500/-
18. Both the above entires are in the name of the accused and the total comes Rs.40,000/- less to the payments detailed at Sl.No.3 in the complaint observed above. Ex.P-11 demonstrates that the entry dated 20.07.2013 is also high-lighted to show the payment. Of course, it is for Rs.40,000/-, but the entry shows that it is "Self Cheque".
19. So far the alleged payment by cash, there is no details shown in the complaint and the same is admitted by the complainant in the cross examination.
20. To prove his case that towards the prompt repayment, the accused had issued the 4 cheques as detailed below, 14 Crl.A.No.2383/2018 Sl.No. Cheque Date Bank & Branch Amount No.
1. 029686 10.06.2014 Axis Bank, Nelamangala Rs. 4,50,000/-
Branch in the name of the Proprietor Firm of the accused
2. 029693 10.06.2014 Axis Bank, Nelamangala Rs. 40,000/-
Branch in the name of the Proprietor Firm of the accused
3. 389323 14.11.2014 Canara Bank, Peenya Rs. 5,00,000/-
Branch in the name of the Proprietor Firm of the accused
4. 389324 14.12.2015 Canara Bank, Peenya Rs.16,43,500/-
Branch in the name of the
Proprietor Firm of the
accused
Total : Rs.26,33,500/-
for the security purpose assuring him that in case, the accused was unable to pay the amounts as alleged on due dates, he may present the same on respective dates, the complainant with his oral evidence has produced the above cheques at Ex.P-14, 17, 16 and 1 respectively.
21. To prove his case that subsequently, out of Rs.27,00,500/-, the accused returned Rs.10,57,000/- to him as detailed below, Sl.No. Date Mode Amount
1. 23.01.2014 RTGS Rs. 2,00,000/-
2. 27.06.2014 NEFT Rs. 1,90,000/-
3. 10.07.2014 - do - Rs. 27,000/-
4. 16.10.2014 - do - Rs. 3,40,000/-
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5. 01.12.2014 - do - Rs. 1,00,000/-
6. 09.12.2014 - do - Rs. 1,00,000/-
7. - Credit Card Rs. 1,00,000/-
Purchase Rs.10,57,000/-
the complainant with his oral evidence, has not produced any documents.
22. As noted above, Ex.P-12 and 13 are the bank account statement extracts of the complainant's firm i.e., Dharithri Technology for the period from 17.01.2014 to 03.08.2015 and from 31.07.2015 to 06.10.2015 and thus, the above stated repayment dates fall within the above period.
23. Ex.P-12 and 13 demonstrate that entries dated 01.12.2014 is the payment to one Shankar amounting to Rs.22,000/- by cheque No.961539 and the entry dated 23.01.2014 is the transfer of Rs.4,00,000/- to the accused firm through cheque No.961504. So, those entries do not pertain to the above stated repayments by the accused.
24. It is in the cross examination of the complainant that he has the bank accounts both in his firm's name and 16 Crl.A.No.2383/2018 in his individual name, but, he has not produced the bank account statements of his personal account/s.
25. The other high-lighted portions at Ex.P-12 and 13 are;
Sl.No. Date Mode of Payment Amount
1. 18.02.2015 (Ex.P-12) Cash Deposit Rs. 40,000/-
2. 10.04.2015 (-do-) - do - Rs. 25,000/-
3. 06.06.2015 (-do-) - do - Rs. 60,000/-
4. 08.06.2015 (-do-) - do - Rs. 40,000/-
5. 31.08.2015 (Ex.P-13) - do - Rs.2,00,000/-
Total : Rs.3,65,000/-
26. But, the above entires do not tally with any of the pleadings of the parties in particular, the complainant with regard to either the alleged payment of loan to the accused or the alleged repayment of the loan by the accused.
27. If the dates of the payments of the alleged loan amount at Ex.P-10, 11 and 12 are taken note off,
a) The payments at Ex.P-10 are for the period from 08.07.2013 to 21.12.2013.
b) The payments at Ex.P-11 are dated 30.01.2014 and 14.03.2014 and the payment high-lighted for Rs.40,000/- i.e., self cheque is dated 20.07.2013. 17
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c) The payments at Ex.P-12 are for the period from 23.01.2014 to 03.04.2014.
28. The alleged repayment of the partial loan amount of Rs.10,57,000/- are for the period from 23.01.2014 to 09.12.2014. The total amount paid till 23.01.2014, i.e., the first repayment date, as per Ex.P-10 to 12 is only the payments shown in Ex.P-10 totally amounting to Rs.7,93,000/- and if the payment high-lighted for Rs.40,000/- i.e., self cheque at Ex.P-11 dated 20.07.2013 is taken into consideration, then (Rs.7,93,000/- + Rs.40,000/-) it is Rs.8,33,000/-.
29. As noted above, there is no details of the alleged payment of Rs.4,00,000/- by cash. Even for the sake of arguments, it is accepted that by the time of first repayment i.e., on 23.01.2014, the payment by cash i.e., Rs.4,00,000/- was already paid, then the total comes to Rs.12,33,000/-.
30. So, as on the date of first repayment i.e., on 23.01.2014, the total amount alleged to be lent was Rs.12,33,000/- and thus, if it is accepted that towards the said balance, the accused paid Rs.2,00,000/- on that date 18 Crl.A.No.2383/2018 i.e., on 23.01.2014, a question arises in the mind of a prudent man that then why on the same date, the complainant has made the payment of Rs.4,00,000/- i.e., the first payment at Ex.P-12, for which there is no explanation and thus, it creates a room for suspicion in respect of the case of the complainant with regard to the payment and repayment in respect of the alleged present transaction.
31. To prove his case that when the accused has not paid the amount, he was constrained to present some of the cheques issued by the accused as stated above i.e., Sl.No. Cheque Date Bank & Branch Amount No.
1. 029686 10.06.2014 Axis Bank, Nelamangala Rs. 4,50,000/-
Branch in the name of the Proprietor Firm of the accused
2. 029693 10.06.2014 Axis Bank, Nelamangala Rs. 40,000/-
Branch in the name of the Proprietor Firm of the accused
3. 389323 14.11.2014 Canara Bank, Peenya Rs. 5,00,000/-
Branch in the name of the Proprietor Firm of the accused
4. 389324 14.12.2015 Canara Bank, Peenya Rs.16,43,500/-
Branch in the name of the
Proprietor Firm of the
accused
Total : Rs.26,33,500/-
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came to be dishonoured, the complainant with his oral evidence has produced the return memos at Ex.P-1, 15 and 17 pertains to the above stated 1 st, 2nd and 4th cheques i.e., Ex.P-15, 18 and 1 respectively. He has not produced any document with regard to dishonour of the above cheque at Sl.No.3 i.e., Ex.P-16.
32. It is the case of the complainant that since the accused did not pay the remaining balance amount of Rs.16,43,500/- after giving due deduction for the amounts paid by the accused in cash as aforesaid, he brought these facts to the notice of the father of the accused namely Sri.M.Lakkanna and only on his instigation, the accused has made the aforementioned payments that too, in installments.
33. At this stage, it is important to note that it is the case of the complainant that towards the prompt repayment, the accused had issued the above 4 cheques at Ex.P-14, 17, 16 and 1 respectively for the security purpose assuring him that in case, the accused was unable to pay the amounts as alleged on due dates, he may present the same on respective dates.
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34. So, if the dates of the payments shown in Ex.P-10 to 12 are taken into consideration, the time gaps between the last payments made by the complainant to the accused as per Ex.P-10 to 12 and the due dates of the above four cheques at Ex.P-14, 17, 16 and 1 respectively, are as stated below;
Cheque Last Last Gap Last Gap
and Due Payment as Payment as Payment as
Date per Ex.P-11 per Ex.P-12 per Ex.P-10
1st cheque Rs. Rs. After Rs. After
at Ex.P-14 10,000/- 5,00,000/- around 80,000/- around
on on 2 months on 6 months
10.06.2014 14.03.2014 03.04.2014 21.13.2013
2nd cheque - do - - do - - do - - do - - do -
at Ex.P-17
10.06.2014
3rd cheque - do - - do - After - do - After
at Ex.P-16 around around
14.11.2014 7 months 11 months
4th cheque - do - - do - After - do- After
at Ex.P-1 around around
14.12.2015 1 year 7 1 year 11
months months
35. At this stage, it is also pertinent to note that it is in the cross examination of the complainant at page No.5 that Ex.P-1 is the cheque given by the accused; he does not know who written the cheque; when it was issued, it was already filled; he started to transact with the accused in 21 Crl.A.No.2383/2018 the year 2013 and the cheque at Ex.P-1 was given to him in 2014.
36. So, a question arises in the mind of a prudent man that then, how the amounts were calculated and the due dates were fixed while issuing the above cheques for the security purpose that too, short by Rs.67,000/- (as the total of the above 4 cheques comes to Rs.26,33,500/-) to the alleged principal loan amount of Rs.27,00,500/-.
37. Moreover, as noted above, it is in the cross examination of the complainant that Ex.P-1 issued in 2014 and it was already filled, but the due date of Ex.P-1 is 14.12.2015. So, there is a room for suspicion with regard to the case of the complainant about the time and circumstances under which, the above cheques were issued to him.
38. It is also the case of the complainant that thereafter, the father of the accused also joined hand in glove with the accused and started to deny the balance amount. Hence, he has lodged a police complaint against the accused on 13.12.2014 with ACP, Bengaluru. But, the accused instead of making payment, issued a legal notice 22 Crl.A.No.2383/2018 through his advocate on 08.08.2015 with untenable grounds which was suitably replied by him vide reply notice dated 26.11.2015.
39. The complainant has reiterated the above complaint averments in his chief evidence. Ex.P-3 is the above noted notice dated 08.08.2015 issued by the accused. The contents therein demonstrate that on the aversions that;
a) in respect of certain transactions between him and the complainant, he/the accused had delivered the cheques bearing Nos.389323 (i.e., Ex.P-16) and 389324 (i.e., Ex.P-1) drawn on Canara Bank, Peenya Branch, duly signed by him on behalf of his company and cheque No.029686 (Ex.P-14) and 029693 (Ex.P-17) drawn on Axis Bank, Nelamangala Branch, issued in the name of his Company respectively for Rs.4,50,000/- and Rs.40,000/- as well as duly signed blank paper.
b) He had paid the entire amount on several dates payable to the complainant and the last one is during December-2014 through RTGS, but the complainant had not returned the documents and on the other hand, lodged 23 Crl.A.No.2383/2018 the complaint before the police, hence demanded to return the said cheques and the documents.
40. The complainant has not produced the copy of the alleged reply dated 26.11.2015 he had alleged to be issued to the notice at Ex.P-3.
41. It is also the case of the complainant that after repeated demands, the accused directed him to present the cheque bearing No.389324 dated 14.12.2015 for Rs.16,43,500/- drawn on Canara Bank, Peenya Branch, Bengaluru in the name of his Firm (i.e., Ex.P-1) for encashment which returned bounced on 18.12.2015 for insufficiency of funds. In support of the above aversions, the complainant with his oral evidence has also produced Ex.P-2, the return memo which is in support of his above case.
42. It is the case of the complainant that immediately on return of the cheque for insufficiency of funds, he intimated the same to the accused, who postponed the demand for payment of the amount. Hence, he got issued the notice on 08.01.2016 which came to be duly served, 24 Crl.A.No.2383/2018 but the accused neither replied nor complied with the demand.
43. In support of the above aversions, with his oral evidence, the complainant has produced the copy of the legal notice at Ex.P-6, the postal receipt at Ex.P-7, the track consignment at Ex.P-8 and the postal acknowledgement at Ex.P-9 in proof of service of the notice at Ex.P-6.
44. He has also produced the office copy of the legal notice dated 09.12.2015 with postal receipt at Ex.P-4 and the postal acknowledgement at Ex.P-5 in proof of service of the said notice at Ex.P-4.
45. At this stage, it is important to note that;
a) the details of the alleged balance amount i.e. how the balance comes to Rs.16,43,500/- are not stated either in the notice, or in the complaint or in the evidence of the complainant.
b) Even the contents of both the notices at Ex.P-4 and 6 are nothing but the replica of the complaint averments, there are some contradictions in the said notice if they are compared with each other. 25
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c) In Ex.P-4, the amount of the cheque bearing No.389324 i.e., Ex.P-1 is not stated which is stated in Ex.P-6. In Ex.P-4, the amount lent is shown as Rs.27,00,500/-, wherein, in Ex.P-6, it is Rs.27,00,000/-.
d) To the question in the cross examination of the complainant that the amount transferred to the account of the accused stated in the complaint and shown in the bank account statements are not tallying with each other, the complainant has answered that he has stated approximately.
46. So, there is once again room for the suspicion with regard to the quantum of amount lent, the time and circumstances under which, the cheques were given to the complainant.
47. The other documents produced by the complainant in support of his case are the tax returns for the assessment years 2013-14, 2014-15 and 2015-16 respectively at Ex.P-19 to 21, but it is in his cross examination that too, by way of admissions that there is no mention in Ex.P-19 to 21 about the alleged loan lent to the accused.
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Crl.A.No.2383/2018
48. The complainant has deposed that Ex.P-19 to 21 are the returns pertain to his company. To the question that they are his personal returns and not of his company, he has deposed that he does not know. But, Ex.P-19 to 21 show that they are the individual returns of the complainant.
49. At this stage, it is important to note that the documents produced by the complainant to show the alleged payments he has made to the accused are Ex.P-10 to 12 and they all of his Firm's bank account. Thus, the tax returns, the complainant required to produce are prima facie of his Firm's. But, for the reasons best known to him, he did not produce the same. So, as per the evidence on record, the payments made to the accused are nothing but unaccounted money.
50. It is important to note that it is well settled principles of law that the Courts cannot come to the rescue of a person for recovery of unaccounted money. In this regard, it is apt to go through;
a) The judgment passed by the Hon'ble High Court of Karnataka, Bengaluru in CRIMINAL APPEAL 27 Crl.A.No.2383/2018 No.173/2016 between Sri.V. Puttaraju Versus Sri.Prasannakumar C., on 23.02.2018 by his Lordship Ravi Malimath J., wherein it is observed that;
"THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378(4) OF THE ........
................
8. Here is a case where a man has an unaccounted cash of Rs.10 lakhs. He has violated the law and is in possession of this unaccounted money. When he has violated the law, he cannot seek protection of law to protect the very same unaccounted cash that he has by violating the law. Therefore, the trial Court was justified in rejecting his compliant and acquitting the accused. ..........
......"
b) (2009) 4 Mh.L.J. 155 (between Sanjay Mishra Vs. Kanishka Kapoor @ Nikki and another in Criminal Application No.4694 of 2008 decided on 24.02.2009 before his Lordship A.S.Oka, J.) wherein it is observed that;
"(a) Negotiable instruments Act, SS. 138 Explanation and 139 - .............
...........
7. It is true that merely because amount advanced is not shown in Income Tax Return, in every case, one cannot jump to the conclusion that the presumption under Section 139 of the said Act stands rebutted. There may be cases where a small amount less than a sum of Rs.20,000/- is advanced in cash by way of loan which may be repayable within few days or within few months. A complaint may not show the said amount in the Income Tax Return as it is repayable within few days or few months in the same financial year. In such a case the failure to show the amount in the Income Tax Return may not by itself amount to rebuttal of presumption under section 139 of the 28 Crl.A.No.2383/2018 said Act. If in a given case the amount advanced by the complainant to the accused is a large amount and is not repayable within few months, the failure to disclose the amount in Income-Tax return or Books of Accounts of the complainant may be sufficient to rebut the presumption Under Section 139 of the said Act.
8. In the present case, the amount was allegedly advanced in September, 2004. The amount is a large amount of Rs.15 lakhs. This is a case where not only that there is a failure to disclose the amount of loan in the Income Tax Return of the applicant till the year 2006 but there is a categorical admission on the part of the applicant that the amount was an "unaccounted" amount.
............
15. The Apex Court has held that the laws relating to the said Act are required to be interpreted in the light of the object intended to be achieved by it despite there being deviation from general law............ The provision of section 138 cannot be resorted for recovery of an unaccounted amount. A cheque issued in discharge of alleged liability of repaying "unaccounted" cash amount cannot be said to be a cheque issued in discharge of a legally enforceable debt or liability within the meaning of explanation of section 138 of the said Act. Such an effort to misuse the provision of Section 138 of the said Act has to be discouraged.
............"
51. So, the principles rendered in the above judgment/decision are in support of the settled proposition of law that the person who violates law and in possession of unaccounted money cannot seek protection under law to protect such unaccounted money and the provision of Section 138 of the Act cannot be resorted for recovery of an unaccounted amount.
29
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52. To substantiate his defence, the accused himself has entered into the witness box as DW-1 and stated the above noted his defence in his chief evidence.
53. In the cross examination of the complainant, the documents pertain to the complaint given by him against the accused before the Deputy Police Commissioner i.e. the true copies of the;
a) Reminder dated 05.06.2015 issued by the office of the Deputy Police Commissioner to the Assistant Police Commissioner, CCB, Bengaluru City,
b) The complaint dated 01.06.2015,
c) The statement of the complainant dated 01.08.2015,
d) The statements of the accused and his father both dated 04.08.2015, were confronted and on admission, were exhibited together at Ex.D-1.
54. The details shown in the complaint of the complainant and his statement at Ex.D-1 series as well as the present complaint are compared, the discrepancy found are;
30
Crl.A.No.2383/2018 Sl. Details Complaint in Statement of the Present No. Ex.D-1 series Complainant in Complaint Ex.D-1 series
1. Total Loan Amount Rs.29,00,000/- Rs.27,00,500/- Rs.27,00,500/-
2. Amount Repaid Rs. 9,00,000/- Rs.9,57,000/- Rs.10,57,000/-
at page No.1 and Rs.1,27,000/-
at page No.2.
3. Balance Amount Rs.20,00,000/- Rs.16,73,5000/- Rs.16,43,500/-
55. It is in the statement of the complainant at Ex.D- 1 series that the accused even received Rs.27,50,000/- on the ground of Income Tax problems, he got the agreement for Rs.5,00,000/-. This portion of the statement of the complainant also support that the amount alleged to be involved in the case is an unaccounted money for which the principles rendered in the above judgment/decision apply.
56. In continuation, it is also in the above statement of the complainant at Ex.D-1 series that towards the security, the accused had issued the 4 cheques (the details of the cheques shown therein are similar to the details of the cheques shown in the present complaint with regard to the cheque numbers, date, bank account and the bank branch), but the amount of the said cheques are not 31 Crl.A.No.2383/2018 mentioned in this statement of the complainant at Ex.D-1 series.
57. So, there are much difference with regard to the quantum of amounts of total loan amount, the amount repaid and the balance amount when compared to the complaint and statement of the complainant in Ex.D-1 series and the present complaint.
58. Moreover, there is no whisper either in the the notice or in the complaint or in the evidence let in by the complainant with regard to the agreement between the parties for Rs.5,00,000/- and also the alleged act of the accused in getting the agreement for Rs.5,00,000/- only, on the ground of the Income Tax problems.
59. On the other hand, there is much cross examination to the accused on his defence that he got the copy of the agreement from the complainant who scanned the same and sent to his mail ID. But, the above statement of the complainant at Ex.D-1 series which is exhibited by confrontation, that too, on admission by the complainant is in support of the defence of the accused with regard to the agreement between them.
32
Crl.A.No.2383/2018
60. The contents of the statements of the accused and his father at Ex.D-1 series are nothing but the replica of the defence of the accused noted above which he/the accused has clearly deposed in his chief evidence.
61. At this stage, it is also important to note that the purpose of lending loan as per the complaint averments and the chief affidavit evidence is to open the business of the accused and the same is stated both in the complaint and in the statement of the accused at Ex.D-1 series.
62. But, strangely, in the cross examination of the accused at page No.7, it is suggested and got admitted on behalf of the complainant that he/the accused had raised the loan to purchase the site near Jayanagar Siddapur which finds place in the statements of the accused and his father in Ex.D-1 series. So, there is clear contradiction with regard to the purpose of the alleged loan.
63. In his evidence, in support of his defence, the accused has also produced Ex.D-2 to 4 wherein Ex.D-2 is the printout of the mail from the complainant to the accused along with an attachment which is the copy of the above agreement and it demonstrates that it is dated 33 Crl.A.No.2383/2018 16.12.2013 and the accused, for his personal reasons, has raised the loan from the complainant amounting to Rs.5,00,000/- agreeing to repay the same within one year and towards the security, he has issued the cheque Nos.389323 (i.e., Ex.P-16) and 389324 (i.e., Ex.P-1).
64. Ex.D-3 is the tax returns of the accused for the assessment year 2014-15 and it demonstrates that the accused has shown Rs.9,00,000/- the alleged loan amount he had borrowed from the complainant under the head unsecured loan.
65. Ex.D-4 is the certified copy of the order sheet and the private complaint in PCR 721/2016 which demonstrates that the complaint averments are nothing but the replica of the defence, the accused has raised in this case and the said complaint is pending awaiting the final report.
66. In his cross examination, the accused has admitted that there is no mention in his tax returns about the alleged repayment he has made to the complainant and he has not produced any document with regard to the payment of the interest at 3% per month. 34
Crl.A.No.2383/2018
67. It is settled proposition of law and there is no quarrel between the parties that the presumption under Sections 118 and 139 of the Act are in favour of the complainant and it is the accused, who is required to rebut the said presumptions with probable defence by letting in either his own evidence or eliciting in the cross examination of the complainant and his witnesses.
68. At this stage, it is pertinent to go through the decisions reported in;
a) AIR 2018 SUPREME COURT 3601 (between T.P.Murugan (Dead) Thr. Lrs. V. Bojan V. Posa Nandhi Re. Thr. POA Holder, T.P. Murugan v. Bojan in Criminal Appeal Nos.950 - 951 of 2018 arising out of SLP (Crl.) Nos.10111 - 10112 of 2014 decided on 31.07.2018 before their Lordships Rohinton Fali Nariman and Ms.Indu Malhotra, JJ.) wherein the Hon'ble Apex Court has held that;
Negotiable Instruments Act (26 of 1881) Ss 118, 138, 139 -
..............
2.7 the respondent contended that the signed blank Promissory Note was issued by him in favour of N.R.R. Finances Investments Pvt. Ltd. Under a hire-purchase agreement for purchasing a lorry on loan basis. The said Promissory note was not issued in favour of the appellant- complainants. The Promissory Note was filled up by DW.2 35 Crl.A.No.2383/2018 Mahesh, an employee or N.R.R. Investments, after the signatures of the respondents were obtained on the same.
..........
8. We have heard Senior Counsel for both parties, and perused the record. Under Section 139 of the NI Act, once a cheque has been signed and issued in favour of the holder, there is statutory presumption that it is issued in discharge of a legally enforceable debt or liability. This presumption is a rebuttable one, if the issuer of the cheque is able to discharge the burden that it was issued for some other purpose like security for a loan.
.........."
b) 2018 Supreme Court Cases 165 : 2018 SCC OnLine SC 651 (between Kishan Rao V. Shankargouda in Criminal Appeal No.803 of 2018 decided on 02.07.2018 before their Lordships Dr.A.K.Sikri and Ashok Bhushan, JJ.) wherein the Hon'ble Apex Court has held that;
A.Debt, Financial and Monetary Laws - Negotiable Instruments Act, 1881 - ................
".............
20. This Court held that the accused may adduce evidence to rebut the presumption, but mere denial regarding existence of debt shall not serve any purpose. The following was held in para 20: (Sharma Carpets, SCC p. 520) "20. ..... The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the Court need not insist in every case that the accused should disprove the non- existence of consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that bare denial of the passing of the consideration 36 Crl.A.No.2383/2018 and existence of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumptions, the accused should bring on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist. ..."
21. In the present case, the Trial Court as well as the Appellate Court having found that cheque contained the signatures of the accused and it was given to the appellant to present in the Bank, the presumption under Section 139 was rightly raised which was not rebutted by the accused. The accused had not led any evidence to rebut the aforesaid presumption. The accused even did not come in the witness box to support his case. In the reply to the notice which was given by the appellant, the accused took the defence that the cheque was stolen by the appellant. The said defence was rejected by the Trial Court after considering the evidence on record with regard to which no contrary view has also been expressed by the High Court.
22. Another Judgment which needs to be looked into is Rangappa v. Sri Mohan. A three-Judge Bench of this Court had occasion to examine the presumption Under Section 139 of the 1881 Act. This Court in the aforesaid case has held that in the event the accused is able to raise a probable defence which creates doubt with regard to the existence of a debt or liability, the presumption may fail. Following was laid down in paras 26 and 27: (SCC pp.453-
54) ..............."
c) AIR 2019 SUPREME COURT 1876 (between Rohitbhai Jivanlal Patel v. Stte of Gujarat and another in Criminal Appeal No.508 of 2019 arising out of SLP (Crl.) 37 Crl.A.No.2383/2018 No.1883 of 2018 decided on 15.03.2019 before their Lordships Abhay Manohar Sapre and Dinesh Maheshwari, JJ.) wherein the Hon'ble Apex Court has held that;
(A) Negotiable instruments Act (26 of 1881), Ss.138, 139 - .............
"..............
14. So far the question of existence of basic ingredients for drawing of presumption Under Sections 118 and 139 the NI Act is concerned, apparent it is that the accused appellant could not deny his signature on the cheques in question that had been drawn in favour of the complainant on a bank account maintained by the accused for a sum of Rs. 3 lakhs each. The said chques were presented to the Bank concerned within the period of their validity and were returned unpaid for the reason of either the balance being insufficient or the account being closed. All the basic ingredients of Section 138 as also of Sections 118 and 139 are apparent on the face of the record. The Trial Court had also consciously taken note of these facts and had drawn the requisite presumption. Therefore, it is required to be presumed that the cheques in question were drawn for consideration and the holder of the cheques i.e., the complainant received the same in discharge of an existing debt. The onus, therefore, shifts on the accused - appellant to establish a probable defence so as to rebut such a presumption.
.................
16. On the aspects relating to preponderance of probabilities, the accused has to bring on record such facts and such circumstances which may lead the Court to conclude either that the consideration did not exist or that its non-existence was so probable that prudent man would, under the circumstances of the case, act upon the plea that the consideration did not exist. This Court has, time and again, emphasized that though there may not be sufficient negative evidence which could be brought on record by the accused to discharge his burden, yet mere denial would not fulfill the requirements of rebuttal as 38 Crl.A.No.2383/2018 envisaged Under Section 118 and 139 of the NI Act. This Court stated the principles in the case of Kumar Exports (AIR 2009 SC 1518, Para11) (supra) as follows:
"20. The accused in a trial Under Section 138 of the Act has two options. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the non-existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed. To rebut the statutory presumptions an accused is not expected to prove his defence beyond reasonable doubt as is expected of the complainant in a criminal trial. The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the court need not insist in every case that the accused should disprove the non-existence of consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that bare denial of the passing of the consideration and existence of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumptions, the accused should bring on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist. Apart from adducing direct evidence to prove that the note in question was not supported by consideration or that he had not incurred any debt or liability, the accused may also rely upon circumstantial evidence and if the circumstances so relied upon are compelling, the burden may like wise shift again on to the complainant. The accused may also rely upon presumptions of fact, for instance, those mentioned in Section 114 of the Evidence Act to rebut the presumptions arising under Sections118 and 139.
................39
Crl.A.No.2383/2018
17. In the case at hand, even after purportedly drawing the presumption under Section 139 of the NI Act, the trial Court proceeded to question the want of evidence on the part of the complainant as regards the source of funds for advancing loan to the accused and want of examination of relevant witnesses who allegedly extended him money for advancing it to the accused. This approach of the trial Court had been at variance with the principles of presumption in law. After such presumption, the onus shifted to the accused and unless the accused had discharged the onus by bringing on record such facts and circumstances as to show the preponderance of probabilities tilting in his favour, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of funds for advancing loan to the accused-appellant. The aspect relevant for consideration had been as to whether the accused-appellant has brought on record such facts/material/circumstances which could be of a reasonably probable defence.
18. In order to discharge his burden, the accused put forward the defence that in fact, he had the monetary transaction with the said Shri Jagdishbhai and not with the complainant. In view of such a plea of the accused- appellant, the question for consideration is as to whether the accused-appellant has shown a reasonable probability of existence of any transaction with Shri Jagdishbhai? In this regard, significant it is to notice that apart from making certain suggestions in the Cross-examination, the accused-appellant has not adduced any documentary evidence to satisfy even primarily that they had been some monetary transaction of himself with Shri Jagdishbhai. Of course, one of the allegations of the appellant is that the said stamp paper was given to Shri Jagdishbhai and another factor relied upon is that Shri Jagdishbhai had signed on the stamp paper in question and not the complainant.
.................."40
Crl.A.No.2383/2018
69. In the present case on hand, it is the defence of the accused that the cheque at Ex.P-1 is one of the cheques, he had issued for the security purpose of the total loan amount of Rs.9,00,000/- he had raised from the accused. On the other hand, it is the case of the complainant that Ex.P-1 is one of the four cheques the accused had issued for the security purpose towards the prompt repayment of the loan amount of Rs.27,00,500/-.
70. So, there is no dispute that the cheque at Ex.P-1 was issued for the security purpose. Even, the accused did not let in the supportive evidence with regard to repayment of the loan amount of Rs.9,00,000/- together with the alleged interest at 3% per month, the payments made by the accused to an extent of Rs.10,57,000/- is admitted by the complainant.
71. As noted above, there are contradictions with regard to the quantum of the alleged loan amount, the repayments and the balance as per the case of the complainant and there are above observed suspicions in the case of the complainant.
41
Crl.A.No.2383/2018
72. Moreover, the loan amount of Rs.9,00,000/- is shown in the tax returns of the accused for the assessment year 2014-15 at Ex.D-3. On the other hand, the loan amount of Rs.27,00,500/- or any part thereof are admittedly not shown in the tax returns of the complainant at Ex.P-19 to 21 and he has not furnished the tax returns of his Firm.
73. Moreover, the documents at Ex.P-3 and D-1 to 4 are in support of the defence of the accused and the adverse inference with regard to Ex.P-19 to 21, which admittedly does not disclose the alleged loan amount of Rs.27,00,500/- or any part thereof and non production of the tax returns of the Firm of the complainant are also in favour of the accused.
74. Hence, in the circumstances of the case, the accused has not only raised a probable defence, but also let in cogent and credible evidence in that regard and thereby not only rebutted the statutory presumptions available to the complainant under Sections 118 and 139 of the Act, but, also shifted the burden on the complainant 42 Crl.A.No.2383/2018 to establish that the alleged loan he had lent to the accused is a legally enforceable debt.
75. Even it is evident on record that there were some money transactions between the parties, the complainant has failed to let in the evidence to substantiate his case that the cheque at Ex.P-1 was issued as narrated by him towards the discharge of the legally enforceable debt and thus, he has failed to discharge the said burden.
76. The impugned judgment demonstrates that relying on the presumptions under Sections 118 and 139 of the Act holding that the accused has failed to rebut the above presumption by letting in the cogent and credible evidence in support of his defence, the trial Court has convicted the accused and it has not observed the above noted contradictions, suspicions, discrepancy in the case of the complainant and the evidence let in by him as well as the cogent and corroborative evidence let in by the accused rebutting the above statutory presumptions.
77. In this background, if the grounds urged by the accused in support of his present appeal are taken into 43 Crl.A.No.2383/2018 consideration, as noted above, the common grounds urged by the accused in support of his present appeal are that;
a) He has submitted the written arguments.
b) Although the trial Court took the same on record, none of the grounds raised in the written arguments were discussed in the impugned judgment and given specific finding.
c) The trial Court has made observations only by magnifying the facts stated by the complainant and in drawing the presumption under law.
d) The depositions and exhibits produced by him with specific view points were not discussed.
e) The nature of documents produced by him keeping in mind the admitted facts by the complainant in the trial has not at all been discussed. Hence, the written arguments filed in the trial Court is to be considered as grounds for this appeal.
78. So, before venturing into the above common grounds, it is necessary to go through the written arguments filed by the accused before the trial Court which 44 Crl.A.No.2383/2018 demonstrates that the grounds he has urged in support of his case are that as per the complaint averments,
a) The chronological events as explained by the complainant in his complaint are self destructive.
b) The complainant received all the four cheques duly filled at once.
c) The complainant did not give the alleged loan at once, but on different dates including the cash sum of Rs.4,00,000/-.
d) Prima facie, there is much difference which creates doubt in the mind of a prudent man with regard to the events of the transactions as narrated by the complainant.
e) Of course, it is evident on record that there are some transactions between the complainant and the accused, but whether the disputed cheque was issued to the complainant towards the legally recoverable debts as alleged by the complainant, there is no material on record.
79. As noted above, the above grounds are apparent on the face of the pleadings and the evidence on record. Hence, these grounds hold water.
45
Crl.A.No.2383/2018
80. The other connected grounds urged by the accused in his written arguments on the file of the trial Court are that;
a) The complainant, despite of agreeing to furnish the statement of account of alleged loan on different dates and the repayment on different dates with calculation of interest, he did not furnish the same only to mislead and misguide the Court to believe all his false versions.
b) There is no document to show the rate of interest and the calculation.
c) All the four cheques amount totally comes to Rs.26,33,500/- and thus, do not reach even the alleged loan amount of Rs.27,00,500/- and then what about the interest.
d) It is the case of the complainant, he/the accused had paid Rs.10,57,000/-. Then the total claim amount varies from document to document.
e) The complainant has produced the pass book at Ex.P-12 and 13 to show that he had paid a sum of Rs.14,50,000/- through Canara Bank as well as Ex.P-10 and 11 to show that he had paid a sum of Rs.7,93,000/- 46
Crl.A.No.2383/2018 and Rs.57,500/- through Karnataka Bank. But, the entries do not tally with the said figures.
81. As noted above, except the 2nd payment of Rs.7,93,000/- which is supported by Ex.P.10, the other payments, i.e., 1st and 3rd payments are less by Rs.50,000/- and Rs.40,000/- respectively as noted above and the 4th payment is admittedly by cash of which, admittedly no details are either stated or proved.
82. Admittedly, there is no pleading with regard to the agreement in respect of any interest, the rate of interest, the quantum of interest, etc., and the total amount of 4 cheques issued as security towards the prompt payment is less by Rs.67,000/- to the alleged principal loan amount of Rs.27,00,500/- and there is no explanation in that regard as noted above and thus, these grounds are also sustainable.
83. The one more ground urged by the accused in his written arguments on the file of the trial Court is that the complainant has admitted that he has not produced any document to show that he had paid Rs.4,00,000/- in cash. 47
Crl.A.No.2383/2018 The cash payment is not acceptable under the Income Tax Act.
84. In support of this ground, it is relevant to go through the decision reported in (2008) 4 Supreme Court Cases 54 (between Krishna Janardhan Bhar Versus Dattatraya G. Hegde in Criminal Appeal No.58 of 2006 decided on 11.01.2008 before their Lordships S.B.Sinha and H.S.Bedi, JJ.) wherein the Hon'ble Apex Court has held that;
"B. Negotiable Instruments Act, 1881 - Ss.138 & 139- Dishonour of cheque - Presumption against accused - Rebuttal of Mode of - Necessary considerations by Court............ No indication as to any business transaction between them - Complainant failed to produce any books of accounts or any other proof to show that he got so much money from Bank - Courts below failed to notice that ordinarily in terms of S.269 - SS, Income Tax Act, any advance taken by way of loan of more than Rs.20,000/- had to be made by an account payee cheque only - considering the peculiar fact a circumstances of the case, held, Courts below approached the matter on wrong application of the legal principles to fact situation of the case. - Hence, conviction and sentence set aside - Criminal trial - Evidence Act, 1972, SS. 101, 103, 4 and 3.
........."
85. In the present case on hand, it is in the cross examination of the complainant that he had paid Rs.4,00,000/- in cash, not in a lump sum, stage by stage, 48 Crl.A.No.2383/2018 such as Rs.50,000/-, Rs.70,000/-. So, the alleged payments were made more than Rs.20,000/- and totally, admittedly, it is Rs.4,00,000/- by cash and thus, the dictum laid down in the above decision is in support of this ground and thus, this ground is also sustainable.
86. The other ground urged by the accused in his written arguments on the file of the trial Court is that the complaint at Ex.D-1 series admitted by the complainant shows that;
a) The complainant himself mentioned about the execution of an agreement for a sum of Rs.5,00,000/- on the ground of problem of income tax payment and he has received two cheques bearing Nos.389323 and 389324 (the cheque in question i.e., Ex.P-1).
b) He/the complainant has made all the payment through cheque and RTGS only. But, in this case he has contended that he made cash payment of Rs.4,00,000/-.
87. The facts in the above ground are as observed above, apparent on the face of record and thus, contradictory to the case of the complainant and thereby, the accused is successful in establishing this ground. 49
Crl.A.No.2383/2018
88. The other connected grounds urged by the accused in his written arguments before the trial Court are that;
a) The alleged payment of Rs.70,000/- by the father of the accused is suppressed in the reply and in the notice which is not calculated in the complaint.
b) The repayments shown by the complainant are different in each of the document which do not tally with each other.
c) There is no calculation or reasons to arrive a fanciful figure of Rs.16,73,000/-.
89. As noted above, there is no supportive documents produced by the complainant with regard to the repayments made by the accused totally Rs.10,75,000/- and there is no calculation stated either in the notice or in the complaint or in the evidence of the complainant in respect of the alleged balance amount of Rs.16,73,000/-. Hence, the above grounds holds water.
90. But, the complainant has not admitted the alleged payment of Rs.70,000/- by the father of the accused. Hence, there is no question of showing the same 50 Crl.A.No.2383/2018 by the complainant either in his notice or in his complaint or in his evidence and thus, this ground holds no water.
91. The other common grounds urged by the accused in his written arguments before the trial Court are that;
a) In their statement before the police, both he and his father N.Lakkanna specifically stated that initially they received a loan of Rs.5,00,000/- and later, received Rs.4,00,000/- and during that time, he executed a loan agreement as surety and gave two cheques of Canara Bank and two cheuqes of Axis Bank and so far he repaid a sum of Rs.9,30,000/- on different dates through RTGS and denied having received a sum of Rs.29,00,000/- from the complainant and also the other allegations.
b) The complainant has admitted his e.mail ID as "[email protected]". From the said address, the complainant himself sent a soft copy of the agreement to him to his e-mail.
c) The copies of the same are produced in Ex.D-2 series wherein both he and the complainant put their signatures. The original is with the complainant and 51 Crl.A.No.2383/2018 he/the complainant has suppressed the said document before the Court.
d) Since the complainant has admitted his e-mail address and further stated that he is still using this e-mail with 3rd parties also, it is proved that there exist an agreement as per the soft copy and the loan amount is only Rs.5,00,000/- with exorbitant interest at 3% per month and issuance of two duly signed blank cheque Nos.389323 and 389324 drawn on Canara Bank, Peenya Branch for security only.
e) He has also produced the Income Tax Assessment of the year 2013-14 with balance sheet wherein the unsecured loan of Rs.9,00,000/- is also shown. The documents are pre-dated to filing of the complaint at Ex.D- 1 and exchange of notices between the parties. Thus, these documents cannot be created and manipulated by him.
92. Except the rate of interest pleaded by the accused, all the other facts in the above grounds are apparent on the face of the documents at Ex.D-1 and D-2 as well as the cross-examination of the parties observed above. The tax returns wherein the loan amount of 52 Crl.A.No.2383/2018 Rs.9,00,000/- shown is for the assessment year 2014-15 as per Ex.D-3. Hence, these grounds are sustainable to the above extent.
93. The other connected grounds urged by the accused in his written arguments are that;
a) In his reply at Ex.P-4, the complainant even furnished the details of the 1 st three cheques, he has not furnished the details of the 4 th one which is Ex.P-1. Hence, it is clear that even as on that date, the cheque was blank.
b) In the notice at Ex.P-4, it is mentioned that the amount received is Rs.10,74,000/- whereas in the complaint, it is mentioned as Rs.10,57,000/-.
c) In the subsequent notice dated 08.01.2016, the complainant has furnished the details of the cheuqe at Ex.P-1, which established that the complainant has filled the cheque with some fanciful figure without any basis.
d) The cheque is only for 3 months, the cheque given in the year 2014 itself. There is no question of presenting the same in January, 2016.
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94. The facts in the above grounds also are apparent on the face of record as noted above and thus, the accused is successful in establishing these grounds also.
95. The other ground urged by the accused in support of this appeal is that while relying on the reported decisions of the superior Courts, the trial Court has not considered the exact gist of the judgments and given a blank and vague findings on the point of law with regard to presumption and rebuttal evidence and more particularly, the company and individual transactions.
96. So far this ground, the learned advocate for the complainant relied on the decision reported in (2011)4 SCC 275 (between Milind Shripad Chandurkar Vs Kalim.M.Khan & Another in Criminal Appeal No.643 of 2008 arising out of SLP (Crl.) No.3045 of 2008 with SLPs (Crl.) Nos.3122 of 2008 and 3124 of 2008 decided on March 3, 2011 before their Lordships P.Sathasivam and Dr.B.S.Cauhan, JJ.) wherein he has drawn the attention of this Court to the observations that;
Held :
.........54
Crl.A.No.2383/2018 In a case of this nature, where the "payee" is a company or a sole proprietary concern such issue cannot be adjudicated upon taking any guidance from Section 142 of the 1881 Act but the case shall be governed by the general law i.e. in the name or style other than his own name. In such a situation, he can sue in his own name and not in the trading name, though others can sue him in the trading name. So far as Section 142 is concerned, a complaint shall be sustainable in the name of the "payee".
.....
10. The High Court has set aside the judgments of the trial Court as well as the appellate Court in revision only on the ground that as the appellant did not produce any evidence to show that he was the proprietor of the Firm he had no locus standi to file the complaint.
...........
12. Dealing with the ....... The appellate Court has noted that perusal of the cross examination indicated that the appellant did not produce any documentary evidence to show that he was the proprietor of Vijaya Automobiles.
Rather it was admitted by the appellant in the cross examination that he did not have any documentary evidence to show that the complaint was the owner of the petrol pump.
..........
14. The relevant part of the .......... .........
"It is true that till today I had not produced any documentary evidence to show that I am owner of Vijaya Automobiles ... Till today I had not produced any documentary evidence to support."
15. The complainant had ........
"I have no documentary evidence to show that complainant Milind Shripad Chandurkar owns the Petrol Pump".
...........
22. In a case of this nature, where the "payee" is a company or a sole proprietary concern, such issue cannot be adjudicated upon taking any guidance from Section 142 of the 1881 Act but the case shall be governed by the general law i.e. the Companies Act 1956 or by civil law 55 Crl.A.No.2383/2018 where an individual carries on business in the name or style other than his own name. In such a situation he can sue in his own name and not in the trading name though others can sue him in the trading name. So far as Section 142 is concerned, a complaint shall be maintainable in the name of the "payee" proprietary concern itself or in the name of the proprietor of the said concern.
............
27. It is evident that the Firm had a substantial amount of business as in one month it sold the diesel to Respondent I - a single party, for a sum of Rs.7 lakhs. The appellant would in addition have also been carrying out business with other persons. Thus, a person with such a big business must have had transactions with the bank and must have been a payee of income tax, sales tax, etc. ........".
97. In the present case on hand also, the complainant is the proprietor of the Firm by name Dharithri Technology and thus, in view of the principles rendered in the above decision, he can file the complaint in his own capacity for the transactions did by his proprietor concern.
98. Accordingly, the above decision is applicable to the case on hand and thus, the ground of the accused that the trial Court has not taken the gist of the case in proper and prospective manner holds no water so far the power of the complainant to file this complaint in his individual capacity even for the transaction of his Firm. 56
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99. But, so for the other facts involved stated in this ground noted above including the statutory presumptions and the rebuttal of the said presumptions, as noted above, they are apparent on the face of record and thus, this ground holds water to that extent.
100. The other grounds urged by the accused in this appeal are that;
a) The complainant himself has given complaint before the police against him seeking certain sum of money with reference to certain loan agreement.
b) The notices and reply also disclose the number of cheques and the actual loan transaction taken place between the parties.
c) The trial Court has only mentioned about few defence without analyzing its impact on the merits of the case and has not given specific findings.
d) He has filed a private complaint against the complainant which is still pending.
e) The trial Court has misguided itself with regard to income tax returns submitted by both of them and went on 57 Crl.A.No.2383/2018 observing something else than the actual points involved in the income tax returns.
f) Viewed from any angle, there is no cause of action to file the complaint.
g) The presumption with regard to liability is rebutted and there is no legally enforceable debt between him and the complainant.
h) Much reliance is placed on reported decisions which are not applicable to the case on hand.
i) The principles of rebuttal evidence by preponderance of probabilities are not considered in the case.
j) The judgment passed by the trial Court is unsustainable in law, vague, without application of mind and evidence on record.
k) The judgment is passed without considering the admitted facts and circumstances of the case. Hence, suffers from material irregularity and biased and liable to be set aside.
l) The impugned judgment is not a speaking order and is liable to be set aside.
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101. As observed above, even the cheque at Ex.P-1 is admittedly drawn on the bank account of the accused Firm and duly signed by him, as noted above, it was issued for security purpose and the accused has successfully let in the rebuttal evidence and the complainant has failed to establish the onus of burden shifted on him to prove that the cheque at Ex.P-1 was issued towards the legally enforceable debt as pleaded by him and the trial Court has lost sight of the same. Thus, all the above grounds are sustainable.
102. In this appeal, in support of his oral arguments, as noted above, the counsel for the complainant has also relied on the case law reported in (2009) 2 Supreme Court Cases 513 (between Kumar Exports Vs Sharma Carpets in Criminal Appeal No.2045 of 2008 arising out of SLP (Crl.) No.955 of 2007 decided on December 16, 2008 before their Lordships R.V.Raveendran and J.M.Panchal, JJ) wherein he has drawn the attention of this Court to the observations that;
"A. Negotiable Instruments Act, 1881 ....... - Declaration made by the complainant himself to the Sales Tax Department that no sale had taken place - Accepted as 59 Crl.A.No.2383/2018 a valid proof that cheques were not issued by accused in discharge of any debt or liability to complainant - ....... the respondent filed ........... The appellants defence was that no sale had taken place and therefore one of the ingredients of Section 138 i.e. discharge of debt or other liability was not satisfied. ..........
..........
Held:
Once testimony of the official of the Sales Tax Department is accepted it becomes evident that no transaction of sale of woolen carpets had taken place between the respondent and the appellant. .........
..........
5. On service of summons the appellant appeared before the Court. His defence was that the bill produced by the respondent indicating sale of woolen carpets was a fictitious one and that blank cheques with his signatures were taken from him by the respondent to enable the respondent to purchase the raw material for him.
According to the appellant the cheques were in the form of advance payment for supply of carpets, but the respondent had failed to deliver the goods to him. The appellant alleged that the respondent had stopped manufacturing carpets and as the cheques were not issued in discharge of any liability, he was not liable to be convicted under Section 138 of the Act.
6. In order to prove his case, ........... as DW2 who stated before the Court that the respondents firm had filed sales tax return for Assessment Year 1994-95 declaring that no sale or purchase of woolen carpets had taken place and therefore, no sales tax was deposited. The said witness also produced an affidavit filed by the respondent as Ex.D- 1 wherein the respondent had stated on oath that no sale or purchase of woolen carpets had taken place during Assessment year 1994-95.
...."
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103. But, the complainant has failed to establish how and in what manner the principles rendered in the above case are applicable to the case on hand.
104. He has also relied on the case law reported in LAWS (KAR) 2017 (1) 102 (between Shashidar Raj Vs.Dr.Jossie Pereira in Crl.Revn.Petition No.981 of 2014 decided on January 18, 2017 before his Lordship R.B.Budihal J.) wherein he has drawn attention of this Court to the observations that;
" ...........
6. Perused the grounds urged in the ....... After considering the entire material on record, the Trial Court arrived at the conclusion that the accused has failed to make out his defence to the satisfaction of the Court and ultimately, held him guilty of the offence punishable under Section 138 of the NI Act. Accordingly, the trial Court convicted him of the said offence. Even according to the judgment of the first Appeal the Court, it goes to show that the first Appellate Court has reappreciated the matter and elaborately discussed the judgment and ultimately, held that no illegality has been committed by the trial Court in convicting the accused and there are no grounds to interfere with the said matter. Accordingly, the first Appellate Court also dismissed the appeal.
......"
105. But, in the present case on hand, as noted above, the accused has let in cogent and credible evidence in support of his defence rebutting the statutory 61 Crl.A.No.2383/2018 presumptions under Sections 118 and 139 of the Act and successful in shifting the burden on the complainant to establish that the cheque at Ex.P-1 was issued towards the discharge of legally enforceable debt, but as noted above, the complainant has failed to establish the same and thus, the observations on which, the counsel for the complainant has relied on in the above noted decision is not helpful to the complainant.
106. From the above observations, since the accused has failed to establish some grounds and successful in establishing major grounds in support of this appeal, Point No.1 is answered in partly affirmative and thus, since the impugned judgment needs interference by this Court, Point No.2 is answered in affirmative.
107. POINT No.3:- For the reasons discussed above, this Court proceed to pass following order.
ORDER The Criminal Appeal filed by the appellant under Section 374 read with Section 382 of Cr.P.C. is hereby allowed.
Consequently, the judgment of conviction and sentence passed by Court of Small Causes and XXVI 62 Crl.A.No.2383/2018 ACMM, Bengaluru in CC.No.20558/2016 dated 27.10.2018 is hereby set aside.
In the result, the Appellant/Accused is hereby acquitted for the offence punishable under Section 138 of the NI Act.
The bail bond and the surety bond, if any, executed in this case shall stand canceled.
If any partial fine amount has been deposited by the accused/his counsel, the same shall be refunded to the accused on proper identification after the completion of the appeal period.
Send back the trial Court record along with the copy of this judgment forthwith to the trial Court.
(Dictated to the Judgment Writer directly on computer, corrected by me and then pronounced in the open Court on this the 24th day of September, 2020).
(K. KATHYAYANI ), LXVI Addl.CC & SJ, Bangalore.
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The counsel for appellant
is present. Kept by for
judgment.
Again called at 4-15 pm.
The respective counsels for both
the parties are absent. No
representation.
The order is pronounced in
the open Court (vide separate
judgment).
ORDER
The Criminal Appeal filed by
the appellant under Section 374
64
Crl.A.No.2383/2018
read with Section 382 of Cr.P.C. is
hereby allowed.
Consequently, the judgment
of conviction and sentence passed
by Court of Small Causes and
XXVI ACMM, Bengaluru in
CC.No.20558/2016 dated
27.10.2018 is hereby set aside.
In the result, the
Appellant/Accused is hereby
acquitted for the offence
punishable under Section 138 of
the NI Act.
The bail bond and the surety
bond, if any, executed in this case
shall stand canceled.
If any partial fine amount
has been deposited by the
accused/his counsel, the same
shall be refunded to the accused
on proper identification after the
completion of the appeal period.
Send back the trial Court
record along with the copy of this
judgment forthwith to the trial
Court.
LXVI Addl.CC & SJ,
Bengaluru