Bangalore District Court
/ M.Srinivas vs S/O.Dodda Muddaiah on 15 February, 2021
1
CRL.A. NO.99/2016
IN THE COURT OF THE LXI ADDL. CITY CIVIL AND
SESSIONS JUDGE, BENGALURU CITY (CCH-62)
Dated this the 15 th day of February, 2021
PRESENT :-
Sri S.R.MANIKYA, B.Sc., LL.B.,
LXI Addl. City Civil & Sessions Judge,
Bangalore, (CCH-62)
Criminal Appeal No.99/2016
Appellant / M.Srinivas
Accused: S/o.Dodda Muddaiah
Aged about 60 years
R/a.No.33, Behind Akkamma Temple
Rammurthy Nagar
Bengaluru-560 016.
(By Sri.S.T., Adv.)
V/s.
Respondent / M/s.Vore Realty Private Ltd.,
Complainant: A Registered Company Incorproated
Under Companies Act
Office at No.237, 3rd Floor
Rajanigandha Garden Apartments
21, Vittal Malya Road
Bengaluru-560 001.
(By Sri.H.S, Adv.)
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CRL.A. NO.99/2016
JUDGMENT
This is an Appeal preferred against the judgment dated 06.01.2016 passed by the learned XLII ADDL ACMM, Bangalore C.C. No.13650/2014 wherein the learned XLII ACMM has convicted the accused for an offence punishable under Section 138 of N.I. Act.
2. The brief facts of the appellant case is that; The respondent under the appeal who is a complainant before the trail court has filed a private complaint alleging that the accused and complainant are known to each other for several years. To purchase the plot the accused approached the complainant to grant hand loan of Rs.15 Lakhs. Accordingly, the complainant has paid this amount on 24.06.2011 through cheque drawn on Standard Chartered Bank. At the time of borrowing of loan the accused issued a cheque and also executed a loan receipt for having received the said amount of Rs.15 Lakhs. Though the accused has borrowed the amount agreeing to repay the same within a short period since he has not repaid the amount the complainant requested the accused to repay the amount. Accordingly the accused had issued cheque for Rs.5,00,000/- on 03.08.12 which was honoured and the accused has also paid a sum of Rs.2,00,000/- on 22.10.12 and Rs.50,000/- on 26.10.12 by way of cash. The accused 3 CRL.A. NO.99/2016 further agreed to repay the balance amount of Rs.7,50,000/- in two installments. Accordingly, the accused has issued a cheque for Rs.5,00,000/- dt.26.04.13 and Rs.2,50,000/- on 20.05.13. Accordingly, on 19.07.13, complainant present the cheque for encashment which was returned dishonored for insufficient funds on 21.07.13. A notice was issued on 31.07.13 and it was returned as unclaimed on 12.08.13. Inspite of knowing about the dishonour of cheque the accused has not repaid the amount. Hence, the complaint has been filed.
3. Inorder to prove the case of the complainant, complainant was examined as PW-1 and got marked documents at Ex.P.1 to 10, Ex.P.3(a), Ex.P.4(a), Ex.P.5(a), ExP.6(a)(b)(c), Ex.P.7(a), Ex.P.8(a)(b)(c). Now, inorder to establish the defence of the accused, DW-1 was examined and got marked Ex.D.1 to Ex.D.5.
4. After hearing both the counsels arguments and after submission of both the counsels written arguments, the learned trial judge has convicted the accused for the offence under Section 138 of N.I. Act holding that the accused has committed the offence punishable under Section 138 of N.I. Act and the cheque was issued for a legally recoverable debt.
5. Against this judgment and finding, this appeal is 4 CRL.A. NO.99/2016 preferred and contended that the trial court has failed in appreciating the pleading of the complainant. As there was a business transaction between the accused and the complainant. The learned Trail Judge failed to appreciate that the cheque was issued as a security purpose for sanctioning of loan from the Nationalized Bank. The learned Trail Judge has failed to appreciate the nature of transaction and dispute is civil in nature. The learned trial judge has failed to appreciate that the complainant has failed to appreciate that the complainant has filed a civil suit against the accused in OS No.1149/2014 for a specific performance of contract amount covered under the disputed cheque. The trial Court has come to a wrong conclusion that the alleged loan was obtained as hand loan. The Trail Court has failed to appreciate the filing of another suit in OS No.1152/2014 against the accused and one Bharathi. The trial court has failed to appreciate the complainant has created the agreement against a dead person and filed a suit which is suit on which the agreement dispute amount is covered. The learned trial judge has completely neglected the depositions of the complainant and admissions given by the complainant in the cross examination. During the cross-examination the accused has admitted that alleged cheque given for sanctioning of loan from nationalized bank. The trial judge has failed to notice that the complainant has not stood on his own contention and he contended that the accused has 5 CRL.A. NO.99/2016 borrowed hand loan, but has pleaded as business transaction. The learned trial judge has miserably failed to notice that the complainant has disputed the amount of Rs. Rs.15,00,000/- is included in Civil Cases and not considered any exhibits and deposition of the accused and come to a wrong conclusion holding that accused has committed the offence punishable under Section 138 of N.I. Act. Hence, the same is liable to be set aside. The learned Trail Judge has miserably failed to note that there is no legally recoverable debt and the presumption cannot be drawn under Section 139 of N.I. Act. the learned trial judge has completely neglected the cross-examination of CW-1. The judgment passed by the learned trail judge is opposed to the natural justice. Hence, liable to be set aside. Hence, he prayed for allowing the appeal.
6. I have heard the appellant counsel and as well as respondent counsel. Now inview of the contention taken by the appellant in the appeal memorandum and the arguments canvassed by both the counsel and the evidence adduced by both the parties and the documents produced by both the parties before the trial court and by analyzing and re- appreciating the evidence on record before the trial court now the following points are arose for consideration;
1. Whether the appellant proves that 6 CRL.A. NO.99/2016 there was no existing liability as on the date of issue of cheque?
2. Whether the appellant has rebutted the presumption drawn under Section 139 of N.I. Act?
3. Whether the judgment passed by the trial court is erroneous and calls for interference by this court?
4. What Order?
7. My answer to the above points are as follows;
Point No.1 to 3 : In the Negative, Point No.4 : As per the final order for the following:
R E A SON S
8. Point No.1:- Now, Where as in this case the complainant has specifically took up a contention that the accused towards purchase of plot borrowed a sum of Rs.15 Lakhs from the complainant as he is acquainted with the complainant and agreeing to repay the same within a short period. Accordingly, the complainant has paid the amount on 24.06.2011 by way of cheque. Since the accused has not paid the amount, the complainant insisted for repayment of the 7 CRL.A. NO.99/2016 amount and the accused towards repayment of the balance sum of Rs.7,50,000/- issued two cheques one for Rs.2,50,000/- and another for Rs.5,00,000/- dated 26.04.2013 was presented for encashment by duly intimating the accused about the presentation on 15.07.2013 and also to maintain sufficient balance in the account for honour of cheque as Ex.P.5. Inspite of that, the accused has made to bounce the cheque for funds insufficient. He has also executed loan agreement as per Ex.P.3.
9. Further, it is also contended that the complainant has issued a notice to the accused calling upon him to pay the amount, that was returned as unclaimed. The learned counsel appearing for the respondent has vehemently contended that inorder to prove the fact of payment made to the accused the complainant has produced Ex.P.2 which is a bank statement extract wherein it is specifically stated that the cheque No.521258 for Rs.15 Lakhs was withdrawn from the account of the complainant by the accused on the date as per the say of the complainant. Further before presentation of the cheque, the complainant has written a letter which is marked as Ex.P.5 wherein the complainant has specifically intimated about the presentation of the cheque to the bank on 16.07.2013 and this Ex.P.5 was returned on 15.07.2013. Where in, well in advance the letter has been issued to the accused about the presentation of the cheque and about 8 CRL.A. NO.99/2016 payment, Ex.P.2 specifically establishes the borrowing of amount and Ex.P.3 is a specific document executed by the accused in favour of the complainant on the date of borrowing of loan which clearly establishes that the complainant has paid the amount to the accused. The accused is liable to make payment of the same. The defence of the accused is that there was a Civil dispute for purchase of property and the suit was also filed and the cheque was issued for sanctioning of loan from the nationalized bank with respect to the property and that has been mis-utilized. But the evidence given by the accused is not satisfactory to prove his defence. Under such circumstances, when the complainant has produced Ex.P.2, Ex.P.3 and 5 which clearly establishes the borrowing of loan and the liability of the accused and after dishonour of cheque for insufficient funds, a notice has been issued and Section 138 (1)(b) has been complied, the presumption has to be drawn under Section 139 of N.I. Act he has argued and contended that point No.1 has to be answered in negative.
10. The learned appellant counsel has vehemently contended in the argument that the complainant has filed three cases against the accused on the basis of three cheques. Though it is specifically admitted that one cheque was issued for a security purpose for sanctioning of loan from the Nationalized Bank on the property, for that purpose the 9 CRL.A. NO.99/2016 sale deed has been handed over to the complainant. Further, it is also contended by the accused that the complainant has filed a suit in OS No.1152/2014 which is marked as Ex.D.3 and Ex.D.1 is the agreement of sale wherein one Bharathi has executed a document which is dated 18.02.2011 and the sale deed is also dated 10.01.1974 in favour of Bharathi which is marked as Ex.D.2 and Ex.D.3. As the suit is filed for Specific Performance against Bharathi and accused. Ex.D.4 is the complaint lodged against the complainant before the police and FIR registered against the complainant. Though this suit has been filed for Specific Performance of agreement on the date, but by producing the death certificate before the Court, it is specifically established that Bharathi was died much earlier to the agreement. Hence, a false claim has been made and accordingly, the case was withdrawn. Further, he has also specifically took up a contention that by perusing death certificate of Bharathi it is clearly established that Bharathi has succumbed to death much earlier to the agreement of sale. He has specifically admitted in the course of cross-examination about the non existing of property in the name of Bharathi. But claim has been made against Bharathi by filing a suit.
11. Further, it is to be specifically noted by handing over the sale deed to the complainant there was an understanding between the accused and the complainant 10 CRL.A. NO.99/2016 that the cheque was issued for sanctioning of loan from the Nationalized Bank. Hence, as there is a contractual liability, there is no existing of a legally recoverable debt. But the learned Trail Judge has wrongly drawn the presumption in favour of the complainant and hence the presumption drawn in favour of the complainant holding that the cheque was issued for a legally recoverable debt is liable to be set aside and the Point No.1 has to be answered in affirmative according to the arguments of the accused counsel.
12. But it is to be specifically noted where as in this case the complainant is claiming the amount stating that the accused has borrowed the loan. To substantiate his contention, he has produced Ex.P.2 and 3. The accused counsel or the accused no where denied in the cross- examination of PW-1 about Ex.P.2 and Ex.P.3. Further, it is also to be specifically noted before the presentation of the chque the complainant has issued a letter on 12.07.2013 intimating the accused that he is going to present the cheque on 16.07.2013. Now if really the defence of the accused has to be accepted stating that the cheque was issued as a security purpose for sanctioning of loan from the Nationalized bank, then there was no impediment for the accused to sent the request of stop payment or not to present the cheque to the bank by the complainant. But no such action has been taken by the accused. Now the accused counsel has 11 CRL.A. NO.99/2016 vehemently submitted his argument on the suit suits filed with respect to the agreement of sale and other aspect of the suit.
13. But the Civil Suit which has been filed against the accused is on a different character and the claim made in that civil suit cannot be clubbed with this case. Because the case filed in this Crl. Appeal is only with respect to the dishonour of cheque. If really there was a civil transaction as contended by the accused and on account of that act and on account of contractual liability the disputed cheque was issued there was no impediment for the accused to take action in the period of two years from the date of borrowing of the loan amount till the dishonour of cheque. Under such circumstance the contention of the appellant counsel that the defence of the accused based on Civil Dispute will establishes the non existing of legally recoverable debt infavour of the complainant cannot be accepted. The question of considering those aspect in this case does not arise at all.
14. It is also to be specifically noted in the course of cross-examination of DW-1 or in the evidence it is not in dispute that the cheque was issued to the complainant, it was dishonoured for insufficient funds and notice was issued and no reply has been sent. In accordance with the well 12 CRL.A. NO.99/2016 established principle of law AIR 2018 SC 3601 D.P.Murugan V/s. Rajan wherein the Hon'ble Apex Court has specifically held that -
"When the accused has taken a defence that cheque was issued for security and there was no action for return of the cheque for a long period will have to be considered as unnatural".
15. The Hon'ble Apex Court in the above decision has held that if the cheque is issued for security or for any other reason if it dishonoured it makes no difference in the offence under Section 138 of NI Act. When the accused has miserably failed to establish about the non existence of liability and the complainant has discharged initial burden of proving the fact of borrowing the loan by a cogent and specific document with the cogent and specific evidence, I am of the opinion that the point No.1 has to be answered in negative.
16. POINT No.2:- Now in this case the learned accused counsel has vehemently contended in his argument that the learned trial judge has not considered the defence taken by the accused and wrongly interpreted the evidence of DW-1 13 CRL.A. NO.99/2016 and held that the accused has committed the offence punishable under Section 138 of N.I. Act, even though the accused has rebutted the presumption drawn in favour of the complainant by establishing a probable and acceptable defence in favour of the accused.
17. He has specifically contended that though the complainant has specifically stated that the amount was borrowed as a hand loan but in other two cases it is specifically admitted that the cheque was issued for property transaction which are coincidentally clubbed with this case, then the question of obtaining hand loan in this case does not arise at all. Further, it is to be specifically noted when the accused has produced Ex.D.1 to Ex.D.5 which clearly establishes about the filing of the suit on a non existing document on a non existing property and wherein two other cases i.e., C.C. No.13647/2014 the claim has been made on the transaction of the property which clearly disproves the case of the complainant. When that is established by a cogent and specific evidence by producing Ex.D.1 to Ex.D.5 and also by examining DW-1 and nothing has been elicited in the course of cross-examination of DW-1 with regard to non establishing of defence of the accused, then the trial court ought to have held that the accused has rebutted the presumption drawn in favour of the complainant. But the trial court has come to a wrong conclusion. Hence, he 14 CRL.A. NO.99/2016 contended that point No.2 has to be answered in affirmative.
18. The respondent counsel has contended that according to the accused there is a civil dispute and with respect to the property transaction this cheque has been issued. But that is not established by the defence evidence. Because the defence evidence adduced by the accused states about the filing of the suit, withdrawal of suit and also claim on the basis of the agreement of sale though such an agreement of sale was not executed. That is nothing to do with this case. Because the claim made on the agreement of sale is a different transaction and the claim made about bouncing of the cheque is a different transaction. Inorder to establish the fact that both the transaction are one and the same, no material is placed by the accused. Though he has contended that the cheque was issued as a security purpose for sanctioning of loan from nationalized bank and on the fact of non sanctioning of loan the accused has not taken any action for recovery of the cheque. When such being the case the defence taken by the accused is not a probable defence and that defence cannot be accepted. Hence, he contended that Point No.2 has to be answered in Negative.
19. Now, it is to be specifically noted when the complainant has established a legally recoverable debt and 15 CRL.A. NO.99/2016 also the presumption is drawn in favour of the complainant holding that the cheque was issued for a legally recoverable debt, then the burden shifts on the accused to rebut that presumption. Mere plausible explanation or mere probable defence is not sufficient to hold that the accused has rebutted the presumption drawn in favour of the complainant. It is admitted fact in the course of cross- examination of DW-1 also that no action has been taken by the accused for recovery of the cheque even though the loan was not sanctioned from the nationalized bank. Further, it is also to be noted even after writing a letter with respect to the presentation of the cheque no reply has been sent. Even after service of notice the accused has not sent any reply contending the defence taken in this case. In accordance with the decision reported in N.Parameshwaran Unni V/s. G.Kannan wherein the Hon'ble Apex Court has specifically held that - Whenever the notice has been sent to the correct address returned as intimation delivered or not claimed, it will have to be considered as a service of notice'. The notice sent to correct address if it is returned as not claimed under General Clause Act, it has to be held that notice has been served.
20. Further, though in this case the accused has took a specific defence stating that the rebuttal evidence adduced by the accused establishes his defence, but the absence of reply 16 CRL.A. NO.99/2016 sent to the notice, and non sending of any letter with regard to the letter of intimation sent by the complainant with regard to the presentation of the cheque and non issue of stop payment to the bank even though he was aware of the fact that the loan was not sanctioned as per his defence will certainly creates doubt in the mind of the court to accept the defence of the accused. In accordance with the decision reported in Kishan Rao V/s. Shankare Gowda and in Crl. A. No.508 of 2019 wherein the Hon'ble Apex Court has specifically held that - "Unless and until the accused has successfully rebutted the presumption drawn in favour of the complainant by a cogent and specific evidence, the question of passing of acquittal does not arise at all". By considering the principles laid down in the decision it is established that inorder to accept the defence the evidence adduced by the accused must be in the form of the probable acceptable and it must be a convincible also. Where in in this case the defence taken by the accused does not satisfy either probable or acceptable or convincible. Under such circumstances, I have no hesitation to answer Point No.2 in the negative.
21. POINT No.3:- Now the learned appellant counsel has vehemently contended that the learned trial judge has wrongly come to the conclusion that the accused has committed the offence punishable under Section 138 of N.I. 17 CRL.A. NO.99/2016 Act even though there is no legally recoverable debt, and accused has rebutted the presumption drawn in favour of the complainant. Though according to the accused, Venugopal has introduced the complainant to the accused. But to establish that fact that Venugopal has not been examined. Though the defence has been taken by the accused with regard to the rebuttal factor of drawing the presumption under Section 139 of N.I. Act that has to convince the trial court and as well as appellate court. The learned Trail Judge has wrongly come to the conclusion that the accused has committed the offence punishable under Section 138 of N.I. Act. Hence, he contended that the grounds urged in the appeal has been satisfactorily established by the appellant and appeal has to be allowed and the judgment of the trial court has to be set aside according to the arguments of the appellant counsel.
22. But now it is to be specifically noted that this is an appeal preferred against the conviction judgment. Now inorder to come to a different conclusion with regard to the conviction order passed by the learned trail judge it must be convincingly established before the appellate court that the accused has satisfactorily explained all the circumstances before the trial court as well as appellate court also he has to satisfactorily establish his defence before the trial court. Inspite of that the learned trial court has come to a wrong 18 CRL.A. NO.99/2016 conclusion then only the question of interference of the appellate court with the judgment of the trial court arises. But where as in this case as already discussed in detail in point No.1 and 2, as a appellate court I have reassessed and re-appreciated the evidence of the parties and the arguments canvassed by both the parties, before this court and I have also come to the conclusion that there exists a legally recoverable debt and accused has miserably failed to rebut the presumption drawn in favour of the complainant and accused has also committed the offence punishable under Section 138 of N.I. Act.
23. Now, it is a well established principle of law that when the cheque was issued for a legally recoverable debt, which was dishonoured for insufficient funds, and Section 138 (B) has been complied, then it is to be held that the accused has committed the offence punishable under Section 138 of N.I. Act. Accordingly the learned trial judge has properly appreciated the facts, circumstances of the case and also properly appreciated the evidence on record and come to a proper conclusion that the accused has committed the offence punishable under Section N.I. Act. By reanalyzing and re-appreciating the evidence recorded before the trial court I have also come to the opinion that the accused has committed the offence punishable under Section 138 of N.I. Act, I have concurred with the opinion of the trial court. Now 19 CRL.A. NO.99/2016 the appellant has took up a contention in the appeal memorandum that inspite of establishing the rebuttal evidence the trial court has wrongly come to the conclusion that section 138 of N.I. Act has been committed by the accused. Hence, the appeal has to be allowed and judgment of the trial court is liable to be set aside.
24. But as already discussed in point No.2 this court has also come to the conclusion that the accused has miserably failed to establish the rebuttal evidence to rebut the presumption drawn in favour of the complainant. When such being the circumstances, the question of non considering the offence under Section 138 of N.I. Act does not arise at all. Further, though the grounds have been urged in the appeal memorandum by the accused these grounds have not been convincingly established before the court to consider the appeal memorandum and to allow the appeal filed by the accused. On the contrary this court has also come to the conclusion that the accused has committed the offence under Section 138 of N.I. Act and when the trial court has come to a proper decision on a lawful approach and also on a factual approach the question of interference with respect to the judgment of the trial court does not arise at all. Under such circumstances, I have no hesitation to answer Point No.3 in the negative.
20CRL.A. NO.99/2016
25. Point No.4:- Having regard to my above observations and findings on point No.1 to 3, I proceed to pass the following:-
OR D E R The appeal preferred by the appellant/accused under Sec.374(3) of Cr.P.C is hereby dismissed as no merits.
Consequently, the judgment and
conviction order passed by the trial
Court in C.C. No.13650/2014 dated
06.01.2016 under the appeal is
hereby confirmed.
Send back the trial court
record with the copy of this
judgment to the Court below
forthwith.
(Dictated to the stenographer on the computer, corrected and then pronounced by me in the open Court on this the 15th day of February, 2021) .
(S.R.MANIKYA) LXI Addl. City Civil & Sessions Judge, Bangalore City.21
CRL.A. NO.99/2016 15.02.2021 App-ST R-HR Judgment pronounced in the Open Court (vide separate order) ORDER The appeal preferred by the appellant/accused under Sec.374(3) of Cr.P.C is hereby dismissed as no merits.
Consequently, the judgment and conviction order passed by the trial Court in C.C. No.13650/2014 dated 06.01.2016 under the appeal is hereby confirmed.
Send back the trial court
record with the copy of this
judgment to the Court below
forthwith.
LXI Addl. City Civil & Sessions Judge,
Bengaluru City.
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CRL.A. NO.99/2016