Bangalore District Court
Krishna Murthy P vs Jayashankar on 25 November, 2020
IN THE COURT OF THE JUDGE COURT OF SMALL
CAUSES AND XXVI A.C.M.M, AT BENGALURU
Present: Abdul Khadar, B.A., LL.B.,
JUDGE, Court Of Small Causes,
Bengaluru.
Dated this the 25th day of November 2020
C.C. No.23076/2016
Complainant: Krishna Murthy P
S/o. Late Gangulappa
Aged about 73years,
R/at No.48, 11th Main,
2nd Cross, Mathikere Extension,
Bengaluru-54.
(By Sri.A. Nagaraja Naid-
Advocate)
-Vs-
Accused : Jayashankar
C/o Parthasaradhi,
Aged Major,
R/at No.255/A, 13th Main,
4th Cross, Gokul, 1st Stage,
1st Phase, Near Ganesh Temple,
Mathikere, Bangalore-560054.
(By Smt. T.S. Chandraprabha-
Advocate)
JUDGMENT
The complainant filed the private complaint under Sec.200 of Cr.P.C., against the accused for having committed an offence punishable under Sec.138 of Negotiable Instruments Act.
2. According to the complainant that, the accused and the complainant are known to each other for the last SCH-9 2 CC No. 23076/2016 10 years. The accused was a tenant for a period of six years in their house and vacated their house portion about 5 years ago. But the accused used to visit their house frequently to meet him, who was his good friend. Accused approached the complainant in the month of August 2015 with a request to lend sum of Rs.5,00,000/- for interest at a rate of 2%p.m. for a period of one year to meet his financial problems and other family necessities. The complainant agreed to pay the amount of Rs.5,00,000/- to the accused by way of cash on 12.08.2015 in the presence of common friends Venkata Setty and family members of the complainant and accused promised to return the said amount within one year and accused issued a cheque bearing No.691418 dated 20.08.2016 for Rs.5,00,000/- drawn on Canara Bank, Kodandaramapuram Branch, Bangalore. The complainant presented the said cheque for encashment through his banker, The Bharat Co-op. Bank Ltd., Mathikere Branch, Bengaluru which came to be dishonoured for the reason as "Funds Insufficient" as per endorsement dated 30.08.2016. Immediately the complainant intimated regarding the dishonor of cheque to the accused, but he failed to pay the amount covered under the cheque. The complainant got issued a legal notice to the accused through RPAD on 09.09.2016 demanding him to pay the cheque amount within 15 days from the date of receipt of notice. The notice was returned as not claimed on 24.09.2016. Despite service of notice, the accused SCH-9 3 CC No. 23076/2016 neither sent any reply nor paid the amount under the cheque. Accordingly, he has filed the present complaint to take action against the accused in accordance with law.
3. Being satisfied with the complaint averments, this Court has taken cognizance and after recording sworn statement being satisfied with the prima-facie case, issued summons to the accused compelling his appearance. Accused appeared through his counsel before this Court and got enlarged on bail. Substance of accusation was read over to him. He pleaded not guilty for the offence punishable u/s.138 of NI Act. Hence, this Court called upon the complainant to prove his case.
4. In support of the case, the complainant himself examined as P.W.1 and got marked 7 documents as per Ex.P1 to P7. After closure of evidence of Complainant, the accused was examined as contemplated u/s.313 Cr.P.C and his statement was recorded. The accused, totally denied the case of the complainant. The accused examined himself as D.W.1 and no document marked on his behalf and the case was posted for arguments.
5. I have heard the arguments canvassed by both counsels and perused the materials available on record.
6. The points that would arise for my determinations are:
1. Whether the complainant proves that the cheque bearing No.691418 dated 20.08.2016 for Rs.5,00,000/- drawn on Canara Bank, Kodandaramapuram Branch, Bangalore, has been issued by the accused towards SCH-9 4 CC No. 23076/2016 discharge of his legal liability and failed to make good to the Complainant after its dishonor and issuance of legal notice within the stipulated period and thereby he has committed the offence Punishable U/s. 138 of the NI Act?
2. What order?
7. My findings to the above points are as under:
Point No.1 : In the Affirmative Point No.2 : As per final order below For the following:
REASONS Point No.1 :
8. It is pertinent to note that, whenever a private complainant is filed seeking prosecution of the accused for an offence punishable under Section 138 of Negotiable Instrument Act, if the issuance of cheque and the signature on the cheque is accepted and admitted by the accused, an initial presumption has to be raised by the Court in favour of the complainant, that the cheque in question was issued towards legally recoverable debt or liability. Of course, this presumption is rebuttable presumption. Such rebuttable evidence has to be placed before the Court by the accused. It is well known that, the accused can rebut the said legal presumption either by cross-examination of complainant or by leading evidence. The complainant himself examined as PW.1 filed affidavit by way of chief examination has reiterated the versions of complaint. I would not like to reproduce the same to avoid repetition of facts since the SCH-9 5 CC No. 23076/2016 complainant has explained the details of complaint averments in chief examination. The complainant produced 7 documents at Ex.P1 to P.7.
9. So far as the document is concerned Ex.P1 is the cheque bearing No.691418 dated 20.08.2016 for Rs.5,00,000/- drawn on Canara Bank, Kodandaramapuram Branch, Bangalore. Ex.P1(a) is the signature of the accused. Ex.P2 is the Bank endorsement issued by the The Bharat Co-Op. Bank Ltd., Mathikere Branch, Bengaluru on 30.08.2016, wherein the said cheque was dishonoured with a shara as "Funds Insufficient". Ex.P3 is the legal notice dated 09.09.2016 wherein the complainant demanded for repayment of money of Rs.5,00,000/-from the accused within 15 days from the date of receipt of notice. Ex.P4 is the postal receipt, in which the notice has been sent through RPAD to the address of accused shown in cause title. Ex.P5 is the unserved postal covers. Ex.P5(a) is the contents of Ex.P5. Ex.P6 and 7 are the Bank Statement. According to the learned counsel for the complainant, when the issuance of cheque and his signature are admitted, then the presumption as required under Section 139 of N.I. Act comes to the aid of the complainant and it is the turn of the accused to explain or rebut the said presumption by raising a probable defence.
10. In this regard, the court has to see whether the accused has been successful in rebutting the presumption through cross-examination of PW-1. In support of his SCH-9 6 CC No. 23076/2016 defence, the accused cross examined PW-1 in length, but nothing has been elicited from his mouth to show that the consideration does not exist as alleged by the complainant under Ex.P1. During the course of cross examination of PW1, he deposed that, he was working employee at HMT company. He retired from the service in the year September 1997. There after he is doing LIC sub agent work. Accused was his tenant. He borrowed Rs.5,00,000/- from his friend Mangathayamma and paid it to the accused. To show that he had document, but not produced before the court. He did the LIC policy of accused, his wife also his daughter. Tulasi is the daughter in law of him and they residing on same roof. His daughter-in-law was paid hand loan of Rs.7,50,000/- to the accused on 21.04.2016 and 23.05.2016 and she filed cheque bounce case against accused in CC No. 21016/2016 and CC No.23075/2016. He further deposed that the accused was agreed to repay the aforesaid amount within 3 months. He denied that at the time of getting policy of accused, he had received 3 cheques from the accused out of which 2 cheques given to his daughter in law and one cheque was misused by him and filed this false complainant.
11. Admittedly, in the cross examination of PW-1, the accused has not elicited from the mouth of PW.1 that there is no existence of legally recoverable debt payable by the accused to the complainant, as he has not taken any amount from him. Hence the complainant proved his case SCH-9 7 CC No. 23076/2016 from four corners of NI Act. The accused has not at all disputed the issuance of cheque or signature on it. Hence it is crystal clear that the cheque in question was issued by the accused in favour of complainant towards discharge of his liability. If at all, the cheque was misused by the complainant, what prevented the accused to take legal action against the complainant immediately after the receipt of demand notice. To escape from the liability, the accused intentionally denied the transaction.
12. The statutory presumption under Sec.139 of N.I. Act explains initial presumption infavour of the producer of an instrument. It says court shall presume that one instrument is handed over infavour of another person only for the purpose of recover of existed debt. Therefore, the statutory presumption explained under Sec.139 of N.I. Act always provides presumption infavour of the complainant. But, it does not mean that the statutory presumption cannot be rebutted. The said presumption can be rebutted at the strength of strong oral and documentary evidence. Let us see the attempt of the accused to-rebut the evidence of complainant.
13. To defeat the case of the complainant, accused himself examined as DW-1, wherein he deposed that, he knows the complainant. He was a tenant under the complainant since from 2006-2007 for the period of 6 1/2 years. Thulasi and the complainant were residing same roof. He has not borrowed Rs.5,00,000/- from the complainant SCH-9 8 CC No. 23076/2016 and not issued Ex.P1 cheque towards repayment of loan. Complainant is doing LIC sub agent work. He got 3 LIC policy from the complainant and issued 3 cheques towards to pay LIC premium purpose. The complainant misused the said cheques and filed this false complaint and Hence prayed to acquit him in accordance with law.
14. This witness cross examined by the counsel for the complainant wherein he admits that, his residential address is Sanganhalli, Cheluru Hobli, Gubbi Taluk, Tumakuru District. He got 3 LIC policy from the complainant in the name of Lalitha, Lavanya and Suma. He do not remember policy numbers and policy product name. He paying premium amount by cash, earlier the complainant has obtained blank cheque assuring that he would return the same after premium payment. He denied that the said policy was lapsed for non payment of premium. He admits that after payment of premium amount he has not asked for return of cheque. He issued cheque for Rs.30,000/- and another for Rs.20,000/- towards premium amount. He admits that, he has not taken legal action against the complainant for non return of cheque. He vacated the rented house during the year 2011-2012, after that he has not issued demand notice by demanding cheques from complainant and he has not produced policy documents before this court.
15. The above said evidence of DW-1 clearly corroborates the case of the complainant that, there is SCH-9 9 CC No. 23076/2016 legally recoverable debt on Ex.P1 by the accused to the complainant. Accused has not made out a probable defence so as to shift the burden on the complainant. The accused has failed to establish his defence that the cheque was misused by the complainant which was given towards LIC premium. Thus, accused has failed to rebut the presumption arisen in favour of complainant under Sections 118(a) and 139 of N.I. Act.
16. The counsel for the complainant has relied Apex Court decision reported in
1. (2019) 10 SCC 287 in the case of Uttam Ram V/s Devinder Singh Hudan and anr. Wherein it is held that, the accused has failed to lead any evidence to rebut the statutory presumption, a finding returned by both the Trial Court and the High Court. Both Courts not only erred in law but also committed perversity when the due amount is said to be disputed only on account of discrepancy in the cartons, packing material 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 cheques in question were drawn for consideration and the holder of the cheques i.e., the appellant received the same in discharge of an existing debt. The onus, thereafter, shifts on the accused- appellant to establish a probable defence so as to rebut such a presumption, which onus has not been discharged by the respondent.
SCH-9 10 CC No. 23076/2016
2. (2019) 4 SCC 197 in the case of Bir Singh v/S Muskesh Kumar, wherein in it is held that, Sec.139 introduces an exception to the general rule as the burden of proof and shifts the onus on the accused, The presumption under Section 139 of the N.I. Act is a presumption of law as distinguished from presumption of facts. Presumption are rules of evidence and do not conflict with the presumption of innocence, which requires the prosecution to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumption of law and presumptions of fact, unless the accused adduces evidence showing the reasonable possibility of the non existence of the presumed fact as held in Hiten P Dalal. But mere denial or rebuttal by the accused was not enough , the accused had to prove by cogent evidence that there was no debt or liability.
17. It is pertinent to note that ordinarily in the cheque bounce cases, what the court has to consider is, whether ingredients of the offence enumerated in Section 138 of the Act have been met and if so, whether the accused was able to rebut the statutory presumption contemplated by Sec.139 of the Act. Once, the cheque relates to the account of the accused and he or she accepts and admits the signature on the said cheque, then initial presumption has contemplated under Sec.139 of the N.I. Act has to be raised by the court in favour of the complainant. The presumption SCH-9 11 CC No. 23076/2016 referred in Sec.139 of N.I. Act is a mandatory presumption and not a general presumption.
18. On perusal of the evidence it reveals that after service of notice, the accused has not taken any legal action against complainant. This defence of DW-1 clearly establishes the fact that the story created by the accused is false. When the accused has admitted Ex.P1 cheque belongs to him and admits his signature on Ex.P1, it is sufficient to hold that the complainant has proved the existence of debt under Ex.P1 by the accused. Thus, it clearly goes to show that since the accused had issued the cheque in question to the complainant for consideration. The notice Ex.P3 issued by the complainant was returned on 24.09.2016. Hence, it is quit clear that the accused avoided the service of notice and he got knowledge about the contents of notice, but the accused has not taken any legal action against complainant there itself the accused has failed to raise the probable defence. The documents on record shows that the accused borrowed loan from the complainant for his necessities and the accused issued the cheque at Ex.P1 to the complainant to discharge his liability.
19. It is pertinent to note that ordinarily in the cheque bounce cases, what the court has to consider is, whether ingredients of the offence enumerated in Section 138 of the Act have been met and if so, whether the accused was able to rebut the statutory presumption contemplated by Sec.139 of the Act. Once, the cheque relates to the account SCH-9 12 CC No. 23076/2016 of the accused and he or he accepts and admits the signatures on the said cheque, then initial presumption has contemplated under Sec.139 of the N.I. Act has to be raised by the court in favour of the complainant. The presumption referred in Sec.139 of N.I. Act is a mandatory presumption and not a general presumption.
20. In this regard I have relied Apex Court decision reported in Criminal Appeal No.867/2016 (arising out of SLP(CRL) No. 5410 /2014) in the case of Sampelly Satyanarana Rao V/s. Indian Renewable Energy Development, wherein it is held that in "Rangappa V/s Mohan, this court held that once issuance of a cheque and signature thereon are admitted presumption of a legally enforceable debt in favour of the holder of the cheque arises, it is for the accused to rebut the said presumption, though accused need not adduce the own evidence and can rely upon the material submitted by the complainant. However mere statement of the accused may not be sufficient to rebut the said presumption.
21. On perusal of the evidence, it reveals that after service of notice or summons from the Court, the accused has not taken any legal action against complainant and the evidence of PW.1 clearly shows that the complainant having sufficient income for advance the loan in question to the accused in the year 2016, since it is a meager amount and the complainant is a retired employee and also LIC Sub agent and he produced Bank Account statement at Ex.P6 SCH-9 13 CC No. 23076/2016 and P7 wherein it appears that the complainant having bank balance of Rs.10,01,000/- as on 28-12-2015 and Rs.5,43,748/- as on 19-04-2016. During the cross examination the accused was not denied the source of income to lend loan to the accused. Hence, the defence of DW-1 clearly establishes the fact that the story created by the accused is false. When the accused has admitted Ex.P1 cheque belongs to his account, it is sufficient to hold that the complainant has proved the existence of debt under Ex.P1 by the accused. Thus it clearly goes to show that since the accused had issued the cheque in question to the complainant for consideration. The notice Ex.P3 issued by the complainant was returned with a reason unclaimed, after that the accused has not taken any legal action against complainant, there, itself the accused has failed to raise the probable defence. The documents on record shows that the complainant had lent the money to the accused and the accused issued the cheque to the complainant to discharge the amount owed by accused.
22. Now, the question that arises that whether the issuance of cheque in question by the accused to discharge the liability of him to the complainant comes under the purview of Sec.138 of N.I. Act or not. It is settled law that in order to draw the presumption under Sec.118 read along with 139 of N.I. Act, the burden was heavily upon the complainant to have shown that he had required funds for having advanced the money to the accused, that the SCH-9 14 CC No. 23076/2016 issuance of the cheque in support of the said payment advanced was true and that the accused was bound to make the payment as had been agreed while issuing the cheque infavour of the complainant.
23. In the present case also the accused has not rebutted the presumption U/s.139 of N.I. by cross examining the PW1 that Ex.P1 cheque was not given towards legally recoverable debt or liability. As per the aforesaid rulings, the presumption mandated by Section 138 of Negotiable Instruments Act includes that this exists legally enforceable debt or liability, which is rebuttable presumption and it is open to the accused to raise defence wherein the existence of legally enforceable debt or liability can be contested. The complainant has proved that the accused had issued the cheque in question to the complainant to discharge his liability which he owed to him. When such being the case the contention of the accused and submission of learned counsel for the accused that the accused did not borrow any amount from the complainant and hence, he is not liable to pay the amount of cheque cannot be acceptable. Thus, the story brought by the accused is unworthy of credit apart from being unsupported by any evidence.
24. The oral and documentary evidence available on record are clearly and categorically established all the ingredients of Section 138 of N.1.Act and also proved the fact that the accused had issued the cheque in question in favour of the complainant for consideration towards the SCH-9 15 CC No. 23076/2016 discharge of liability and the said cheque was dishonoured and then the accused failed to pay the amount of cheque within 15 days from the date of service of the demand notice. Hence, the dishonor of the cheque in question is clearly attracts the penal provision of Section 138 of the N.I. Act and the complainant has proved the guilt leveled against the accused for the offence P/u/s Section 138 of the N.I. Act. The accused has utterly failed to rebut the presumption under Sec.138 of N.I. Act infavour of the complainant. Hence, the complainant is entitled for benefit of statutory presumption as contemplated under Sec.139 of the Act. I did not find any informalities or contradictions elicited to render his evidence incredible. Therefore, the testimony of PW-1 inspires confidence to believe and to act upon the evidence of PW.1 and the documentary evidence at Ex.P1 to P7 are consistence, corroborative and supporting to each other and in accordance with the case of the complainant and which leads me to conclude that the complainant has proved beyond reasonable doubt against the accused for the alleged offence punishable under Sec.138 of N.I. Act. Accordingly, I answer Point No.1 in the Affirmative.
Point No.2:
25. In view of my above discussions and findings on Point No.1, I proceed to pass the following:
SCH-9 16 CC No. 23076/2016
ORDER
Acting under Section 255[2] of Cr.P.C, the accused is hereby convicted for the offence Punishable U/s. 138 of the N.I. Act.
The accused shall pay fine of Rs.5,50,000/- In default of payment of fine amount, the accused shall under go Simple Imprisonment for six months.
Out of the amount so realized, the accused shall pay a sum of Rs.5,45,000/- to the Complainant as compensation, as provided U/s.357 Cr.P.C. The remaining amount of Rs.5,000/- shall go to the State.
The bail bond and surety bond of the accused is hereby stand canceled.
Office is directed to furnish free copy of this judgment to the accused.
(Dictated to the Stenographer directly over computer, typed by her, corrected and then pronounced by me in the Open Court on this the 25th day of November 2020.) (Abdul Khadar) Judge, Court of Small Causes, & ACMM, Bengaluru.
ANNEXURE List of Witnesses examined on behalf of complainant:
PW -1 Krishna Murthy P SCH-9 17 CC No. 23076/2016
List of Documents marked on behalf of complainant:
Ex.P1 Cheque Ex.P1(a) Signature of accused Ex.P2 Bank Endorsement Ex.P3 Legal Notice Ex.P4 Postal receipts Ex.P5 Unserved postal covers Ex.P5(a) Contents of Ex.P5 Ex.P6&7 Bank Statements
List of Witnesses examined on behalf of accused:
DW -1 Jayashankar List of documents marked on behalf of accused:
Nil (Abdul Khadar) Judge , Court of Small Causes, & ACMM, Bengaluru.