Bangalore District Court
Society On The Same Day. The Accused Has ... vs Has Placed Reliance Upon His Own Oral ... on 1 January, 2016
IN THE COURT OF THE XL ADDL.CHIEF METROPOLITAN
MAGISTRATE, BANGALORE CITY. SCCH-14
PRESENT: BASAVARAJ CHENGTI., B.Com.,LL.B.,(spl)
XL ACMM,
BANGALORE.
C.C.No. 16485/2013
Dated this the 1st day of January 2016
1. Sl.No. of the case C.C. No.16485/2013
2. The date of Institution 15.05.2013
3. The date of commencement
of the evidence 07.08.2014
4. Name of the Complainant M/S SAPHALYA CREDIT CO-
OPERATIVE SOCIETY LTD.,
No.640, 80 feet road,
Girinagar II Phase,
Bangalore-560 085.
Represented by its G.P.A
Holder and Recovery Officer,
Sri.D.R.Ravindra,
(By pleader Sri ULS)
5. MR.B.N.ANAND
Name of the Accused S/o B.N.Krishna Reddy,
Aged about 47 years,
R/at Bellandur Village & Post,
Varthur Hobli,
Bangalore South Taluk, Bangalore-
560 047.
(By pleader Sri SDK)
6. The offence complained of Under Sec.138 of N.I. Act.
or proved
7. Plea of the accused on his Pleaded not guilty
examination
8. Final Order
Accused is convicted
9. Date of such order 01.01.2016
SCCH-14 2 CC No.16485/2013
JUDGMENT
This is a complaint filed by the complainant against the accused for the offence punishable U/Sec.138 of Negotiable Instruments Act (hereinafter called the Act).
2. Brief averments of the complaint are as under:
The accused is a member of complainant's Society under Membership No.2177. He has borrowed a personal loan of Rs.25,000/- on 13.01.2002 under L.L.F No.1428 from the complainant's Society and agreed to pay the same in 40 equal monthly installments with interest @ 19% p.a., and penal interest @ 2% p.a., on delayed payment. To secure the repayment of said loan, he has executed security documents in favour of complainant's Society on the same day. The accused has failed to pay loan amount in regular installments. The complainant's Society demanded the balance outstanding with present interest @ 17% pa., amounting to Rs.55,460/-. The accused has issued a cheque bearing No.6626901 dt.30.03.2013 for Rs.55,460/- in favour of the complainant's Society drawn on State Bank of Mysore, Whitefield Branch, Bangalore. The complainant has presented the said cheque for encashment through his Banker, Sree Thyagaraja Co-operative Bank Ltd., Srinivasanagar Branch, Bangalore, but the cheque was returned unpaid for the reasons "Funds Insufficient" vide is banker's memo dt.03.04.2013. Therefore, the complainant got issued a legal notice to the accused on 18.04.2013 through RPAD to his residential address, calling upon him to pay the amount of cheque. But the said notice returned un-served as "Incomplete address" on 27.04.2013. Hence, the complainant has filed this complaint praying for convicting the accused for the offence punishable U/Sec.138 SCCH-14 3 CC No.16485/2013 and 142 of the Act, punishing him and for awarding compensation.
3. On the basis of the complaint, cognizance of offence was taken and the complaint was registered in PCR No.9880/2013. Then, sworn statement of the GPA holder of the complainant's Society was recorded. After hearing the complainant and his counsel, the court found sufficient material to issue process against the accused for the offence punishable U/s 138 of the Act. Accordingly, this criminal case was registered against the accused for the said offence and process was issued. Initially, the complaint was presented before 12th ACMM Bangalore which was transferred to 19th ACMM, Bangalore and later, it came to be transferred to this court. In the pursuance of the process, the accused has appeared before court through his counsel and he is enlarged on bail. Then, substance of accusation was read over and explained to the accused. He has pleaded not guilty. Hence, the complainant was called upon to prove his case.
4. During evidence, the complainant has examined his GPA holder as PW.1 and examined a witness as PW.2. He has got marked documents as Ex.P1 to Ex.P7. Then, statement of accused was recorded. The accused has examined himself as DW.1 and examined three witnesses as DW.2 to 4. He has got marked documents as Ex.D1 and 2.
5. Heard the arguments. The complainant has relied upon ruling reported in 2014 Crl.L.J.3937 (M/s Ajeet Seeds Ltd Vs K.Gopala Krishnaiah). The accused has relied upon following rulings;
1.2012 Crl.LJ 804 (H.P Moodalappa Vs C.A.Chowdappa)
2. 2009 Crl.LJ 4460 (M/s Matheson Bonsanquet Vs K.V.Manjunath )
3. 2014 (3) DCR 783 (N.Shrihari Vs Babu Shetty)
4. 2013 (1) BC 101 ( Shobha Vs Gajanan) SCCH-14 4 CC No.16485/2013 I have gone through the ruling and perused the record.
6. Now the points arise for my consideration are:
1. Whether the complainant has proved that the accused has issued Ex.P-1 cheque in his favour towards discharge of legally recoverable debt without maintaining sufficient balance in his bank account and has failed to pay the cheque amount within time inspite of deemed service of demand notice?
2. What order?
7. My findings are:
POINT NO.1 : In affirmative.
POINT NO.2 : As per final order.
REASONS
8. POINT NO.1: The complainant has relied upon oral evidence of PW-1 and documentary evidence at Ex.P-1 to 7 to prove his case. The accused has placed reliance upon his own oral evidence and that of DW-2 to 4 and documents at Ex.D-1 and 2 to prove his defence and to disprove the case of the complainant.
9. The admitted facts of the case are that the complainant is a co-operative society of which the accused and DW-3 are members, that the accused and DW-3 have borrowed loans from the complainant on different dates and said loans were repayable in monthly installments, that the accused and DW-2 and 3 are residing in Bellandur village, Varthur hobli, Bangalore South Taluk, Bangalore, that Ex.P-1 cheque is of the accused and it bears his signature, that the accused is residing in the address SCCH-14 5 CC No.16485/2013 shown in the complaint, that a cheque bounce case is filed by the complainant against DW-3.
10. PW-1:Ravindra has deposed that the accused has issued Ex.P-1 cheque in favour of the complainant towards discharge of debt, that the said cheque came to be dishonoured for insufficient funds in his account, that a demand notice was sent to the accused calling upon him to pay the amount of cheque, but it was returned with endorsement "incomplete address", that the accused has neither replied the notice nor paid the amount of cheque and thereby committed the offence punishable U/s 138 of the Act. His evidence is as per the averments of the complaint.
11. The complainant has produced cheque, bank memo, copy of notice, postal receipt, postal cover, copy of GPA and letter of SBM which are marked as Ex.P-1 to 7. The accused has contended that there is no seal on the cheque and memo and there is no signature on the memo as such the cheque was not presented for encashment and memo is got created for this case. In that regard, the accused has examined DW-4: Srinivasa who has supported the contention of the accused. Then, the complainant has examined PW-2:Nataraj who has deposed regarding dishonour of cheque at Ex.P-1 and stated that the cheque was dishonoured for insufficient funds in the account of the accused. He has produced letter regarding dishonour of cheque for insufficient funds which is marked as Ex.P-7. On perusal of oral evidence of PW-2 and DW-4, it reveals that evidence of both of them is true in their respective capacity. The cheque at Ex.P-1 was not presented to the branch for encashment in which DW-4 is working and the account of the accused is not debited with cheque bounce charges, but that itself does not make the evidence of PW-2 unbelievable. When there is SCCH-14 6 CC No.16485/2013 a clearing house, the cheques will not be presented to concerned branch for encashment. The clearing cell is able to see the balance in the account of customer and issue memo. In such event, the branch will have no document or material to say that the cheque was in fact presented for encashment. That is what DW-4 has deposed. But, the clearing cell is competent to depose in that regard. There is nothing on record to believe that PW-2 is deposing falsely to help the complainant. There is no nexus between the him and the complainant to do so. Hence, I am of the opinion that evidence of PW-2 is trustworthy. Ex.P-2 is not issued by clearing cell, but it was issued by Apex Co-op. Bank Ltd., (AXB) based on the memo issued by the clearing cell. Ex.P-7 confirms the presentation of cheque and its dishonour for insufficient funds. Evidence of PW-2 and contents of Ex.P-7 are sufficient to believe that the cheque at Ex.P-1 was presented for encashment on 2.4.2013 and it came to be dishonoured for insufficient funds on 3.4.2013. ExD-1 and 2 are statements pertaining to the bank account of the accused which confirm that there was no balance in his account to honour the cheque at Ex.P-1 on its date and on the date of its presentation for encashment. Merely on the basis of the fact that cheque bounce charges were not debited to the account, we can not conclude that the cheque was not at all presented for encashment and Ex.P-2 and 7 are created for this case. There is no logic behind the argument of the defence in that regard. There was no necessity for the payee to create the bank memo which can be obtained by mere presentation of cheque for encashment. Hence, I reject the argument of the counsel for the accused regarding non-presentation of cheque to bank.
12. The accused has denied the authority of PW-1 to file complaint and to depose regarding the matter. Except bare denials, nothing is SCCH-14 7 CC No.16485/2013 elicited from PW-1 in that regard. Ex.P-6 is copy of GPA which authorizes PW-1 to file complaint and to give evidence in the matter. The accused is not competent to deny the contents of Ex.P-6 and the authority given to PW-1 by the president of the complainant. Moreover, the evidence of DW-1 to 3 makes it clear that PW-1 has got personal knowledge about the facts of the case. Hence, I am of the opinion that evidence of PW-1 is admissible and believable.
13. PW-1 is cross examined minutely in respect of loan transaction between the complainant and the accused. However, it is admitted impliedly by way of suggestions and expressly by DW-1 to 3 that the accused has borrowed a loan of Rs.25,000/- from the complainant in the year 2002. The said fact is admitted by the accused during his statement. When such being the case, minute particulars of loan, documents pertaining to loan, date of loan, deduction of amount towards share, etc., become immaterial and cross examination of PW-1 in that regard does not help the accused to prove his defence.
14. The counsel for the accused has argued that the loan is of the year 2002. The last admitted payment was on 28.3.2006. The outstanding amount if any in the account of the accused had become time barred on 28.3.2009. Whatever may be the amount, it was not a legally enforceable debt or liability on the date of cheque and hence, dishonour of Ex.P-1 cheque does not attract offence U/s 138 of the Act. But, it is to be noted that cheque is a negotiable instrument. Issuance of cheque itself is a promise to pay the amount including a time barred debt. Hence, argument of the counsel for the accused in that regard holds no water.
SCCH-14 8 CC No.16485/201315. DW-4:Srinivasa has deposed that the account of the accused pertaining to Ex.P-1 was opened prior to 2003 and the cheque in question was from the cheque book issued to the accused prior to 2003, that no cheque book is issued to him after 2005, that account number is changed after 2005 in which year the bank is computerized. DW-1: Anand has stated that the complainant got his account opened in SBM, Whitefield branch and obtained 10 blank signed cheque from him as security for the loan, that one cheque is misused and other 9 cheques are still lying with the complainant. PW-1 was cross examined at length in that regard, but nothing is extract from him regarding obtaining of 10 blank signed cheques from the accused as security and availability of other 9 cheques with the complainant. The counsel for the accused has argued that the cheque at Ex.P-1 is of the year 2002 which was obtained as security with other 9 cheques, that the cheque is misused for filing this false case against the accused, that the cheque contains two different handwritings and two different colour ink which indicate the misuse of cheque. It is to be noted that there is no doubt that the cheque is of year 2002 or 2003, but that itself is no ground to believe that the complainant has obtained 10 blank signed cheques from the accused as security and one of them is misused to file this complaint. A customer of bank after getting the cheque book, can use the cheques in it at any time during continuation of the account. Neither the creditor nor the bank has any control over the issuance of cheque by the drawer. The cheque at Ex.P-1 is not dishonoured on the ground that it is an old cheque. There will be no occasion for the payee to know about the date of issuance of cheque book by the bank to the drawer. There cannot be any chance of knowing that it was an old cheque. There is no corroboration to the evidence of DW-1 that the complainant has got his account opened and obtained 10 blank signed cheque as security. There SCCH-14 9 CC No.16485/2013 was no necessity for getting 10 blank cheques as security for a loan of Rs.25,000/-. It is pointed out that Ex.P-1 is the first cheque in the series, but that itself does not prove the contention of the accused that other 9 cheques are with the complainant. Hence, argument of the counsel for the accused in that regard is liable to be rejected.
16. Ex.P-1 is the cheque dt.30.3.2013. The contention of the accused that the cheque was issued in blank as security in the year 2002 is against the legal presumption U/s 118 of the Act which mandates the Court to believe that the cheque is issued on the date which is mentioned in the cheque. There is no cogent evidence to disbelieve the same. Uncorroborated evidence of DW-1 is not sufficient to rebut the presumption and to establish that the cheque was in fact issued in the year 2002. Admittedly, the cheque is drawn on an account of the accused maintained by him with SBM, Whitefield branch, Bangalore and it bears his signature. When signature on the cheque is admitted, then handwritings and colour of ink of handwritings on the cheque become immaterial. The person putting the signature on a negotiable instrument is bound by its contents which can not be disbelieved only on mere denial by him. The cheque at Ex.P-1 is drawn in favour of the complainant for Rs.55,460/-. Sec.118 of the Act says that it can be presumed that a cheque is issued for consideration. Sec.139 of the Act mandates the Court to draw a presumption that a cheque is issued towards discharge of legally enforceable debt or liability. When these legal presumptions are drawn in favour of the complainant, then it shall be presumed that the cheque at Ex.P-1 was issued by the accused for consideration in favour of the complainant towards legally enforceable debt. But, it is to be noted that if the complainant discharges his primary burden, then only we can draw SCCH-14 10 CC No.16485/2013 such presumptions. In this case, the cheque at Ex.P-1 is issued in the name of the complainant for Rs.55,460/-. It is dated 30.3.2013. Ex.P-2 reveals that the cheque was presented for encashment on 2.4.2013 and it was dishonoured on 3.4.2013. Ex.P-3 to 5 disclose that the complainant got issued legal notice to the accused on 18.4.2013 by RPAD which returned unserved as "incomplete address". The counsel for the accused has argued that the notice was not served on the accused as such no cause of action arose to the complainant to file the complaint. It is to be noted that DW-1 has admitted during cross examination that the address mentioned in the complaint is his correct address, that there was no house number to his house when he borrowed loan and house number is allotted about 2-3 years back. These admissions go to show that the notice at Ex.P-3 was sent to correct address of the accused by prepaid postal service. Hence, the notice is deemed to have been served on the accused. The onus shifts upon the accused to prove that there was no chance of service of notice on the said address. The accused has not adduced any evidence in that regard. His admissions go against his contention. Hence, I hold that there was deemed service of notice upon the accused. The last date mentioned on the cover at Ex.P-5 is 27.4.2013. If the said date is considered as the date of deemed service of notice, there was time to pay the amount till 12.5.2013. Cause of action arose for filing the complaint on 13.5.2013. The complainant has filed this complaint on 15.5.2013 which is well within time. PW-1 has deposed about the facts averred in the complaint which is corroborated by the contents of Ex.P-1 to 7. Thus, the complainant has discharged his primary burden to prove his case. Hence, the Court has to draw legal presumptions U/s 118 and 139 of the Act in favour of the complainant. The said presumptions are in respect of date of drawing of cheque, existence of debt or liability and issuance of cheque towards SCCH-14 11 CC No.16485/2013 discharge of debt or liability as held by Hon'ble Supreme Court in Rangappa Vs Mohan case. But, the said presumptions are rebuttable presumptions. The accused has to rebut the same by probable defence. Plausible explanation is not sufficient to rebut the presumptions as held by Hon'ble Supreme Court. The accused has to prove his defence by preponderance of probability.
17. In this case, the accused has admitted the borrowing of loan of Rs.25,000/- from the complainant, but he has contended that entire loan amount is repaid to the complainant, that the cheque in question was delivered to the complainant along with other 9 cheques as security on the date of loan, that in spite of repayment of entire loan amount, the complainant has not closed the loan account, has not returned blank signed documents including the cheques and misused the cheque at Ex.P-1 without there being any legally enforceable debt, that he is not liable to pay the amount of cheque. Hence, he has sought for his acquittal from the case. He has examined himself as DW-1, examined his brother and a neighbour as DW-2 and 3 to prove the repayment of amount and to prove his defence. Evidence of DW-4 and contents of Ex.D-1 and 2 are already discussed above. If the accused is able to prove his defence by preponderance of probability, then onus shifts upon the complainant to prove the existence of debt and issuance of cheque by independent evidence. Since, presumptions U/s 118 and 139 are drawn in favour of the complainant, loan documents, ledger extract, vouchers and receipts are not necessary. The complainant has produced ledger extract as per the direction of the Court given in pursuance of I.A. filed by the accused. The said document remained unmarked. The person calling the other party to produce a document is bound to give it in evidence, but the accused has SCCH-14 12 CC No.16485/2013 not chosen to get it marked. Since, the said document is produced by the complainant before the Court as per direction given in that regard, it becomes part of the records and its contents can be read in evidence.
18. DW-1:Anand has stated as per his defence. DW-2:Venugopala Reddy and DW-3 Basavaraj have supported the version of DW-1 as to payment of all installments by him to the complainant. PW-1 Ravindra has admitted the payment of Rs.20,000/- by the accused on 28.3.2006 in the house of DW-2, but he has denied the repayment of entire loan amount by the accused and retention of blank signed cheques and other documents, misuse of cheque at Ex.P1 and filing of this case based on misused cheque. DW-1 has deposed that the complainant has not issued any receipts for the amount paid and he went on postponing to return the documents including the cheques even after payment of entire dues. The suggestions given to DW-1 to 3 and evidence of PW-1 go to show that repayment of Rs.20,000/- on 28.3.2006 is admitted. The said fact does not require further proof, but payment of 20 installments by the accused is denied by PW-1. Except bare denials, nothing is elicited from him. Only on the say of DW-1 to 3, it can not be believed that the accused has paid monthly installments regularly for about 20 months and the payment made by him on 28.3.2006 was towards full and final settlement. The accused has not produced receipt or counter foil for having paid the amount to the complainant. He has not initiated any legal action against the complainant for filing this complaint on the basis of forged cheque till this date. He was very much residing in the address shown in the cause title, but the statutory notice was not served upon him. The conduct of the accused indicates that he was knowing about the dishonour of cheque and in spite of it, he has not received the notice. There is no reply by the accused for SCCH-14 13 CC No.16485/2013 the said notice. Hence, the defence of the accused is baseless and the accused has failed to raise his defence at the earliest point of time. Even after his appearance before the Court, the accused has not made any efforts to get back his cheques if any, from the complainant. He has not filed any complaint or suit for getting back his cheques and other documents. Except oral evidence of DW-1 to 3, there is nothing on record to believe that the accused has paid 20 installments regularly prior to 28.03.2006 and has paid Rs.20,000/- on 28.3.2006 towards full and final settlement of his loan account. Hence, I am of the opinion that the defence raised by the accused is improbable and unbelievable.
19. DW-2:Venugopala Reddy is none other than the brother of the accused. DW-3:Basavaraj is a neighbour against whom similar cheque bounce case is filed by the complainant. Their evidence is uncorroborated. Any amount of oral evidence does not equate the documentary evidence as to payment of amount. DW-1 and 2 have deposed that in spite of payment of entire dues, the complainant has not returned blank documents and cheques. No prudent man keeps quite under said situation. He ought to have obtained an endorsement regarding closure of account or regarding payment of amount towards full and final settlement of dues. The accused has not acted like a prudent man. Hence, his evidence as to discharge of entire liability is unbelievable. DW-3 is a neighbour of the accused who is sailing in the same boat and facing cheque bounce charges by the complainant. DW-2 is none other than the brother of the accused. These two witnesses are interested to see the acquittal of the accused and hence, oral evidence of DW-2 and 3 is also unbelievable and unreliable. Thus, the accused has failed to prove his defence as to repayment of entire dues of the complainant. Only on the basis of oral say of DW-1 to 3, it can not be SCCH-14 14 CC No.16485/2013 held that the accused was not liable to pay any amount to the complainant as on the date of cheque. The accused ought to have examined the bill collector of the complainant to prove the payment of installments. He has neither produced receipts, bank statement nor pass book to prove the payment of amount. I am of the opinion that the accused has failed to prove his defence by preponderance of probability. The rulings relied upon by the accused are not applicable to the facts of this case. Hence, I hold that presumptions raised in favour of the complainant remained unrebutted. The complainant has got marked relevant and necessary documents before the Court. He has complied all requirements of Sec.138 of the Act. Hence, the complainant need not produce evidence as to proof of transaction, balance due and issuance of cheque. The complainant is the payee named in the cheque. It came to be dishonoured for want of funds. The demand notice was in time and it is deemed to be served on the accused. In spite of knowing about the dishonour of cheque, the accused has kept quite. Cheque in question was in the custody of the complainant prior to its production before the Court. It implies that the amount of loan is not repaid. Uncorroborated testimony of DW-1 to 3 does not inspire the confidence of the Court to believe the discharge of debt. There is no enmity or grudge between PW-1 and the accused. There is nothing on record to believe that the complainant has misused the blank cheque of the accused to file this complaint. Therefore, I disbelieve the evidence of DW-1 to 3 as to repayment of entire loan amount by the accused to the complainant. Since, the legal presumptions remained unrebutted, it can be said that there was legally enforceable debt payable by the accused for the issuance of cheque at Ex.P-1. The said cheque came to be dishonoured for insufficient funds. The complainant has demanded the payment of amount of cheque in writing and the notice is deemed to have been served upon SCCH-14 15 CC No.16485/2013 the accused. In spite of it, the accused has not paid the amount of cheque. He has not tendered the amount even after his appearance before the Court on service of summons. Hence, I hold that the complainant has proved his case. The accused is guilty for the offence punishable U/s 138 of the Act and he is liable for conviction. Consequently, I answer the point in affirmative.
20. POINT NO.2: In view of above discussion and finding, I pass following:
ORDER The accused is found guilty and is convicted U/s 255(2) of Cr.P.C. for the offence punishable U/s 138 of Negotiable Instruments Act.
The accused is sentenced to pay a fine of Rs.1,10,000/-. In default of payment of fine, the accused shall undergo SI for a period of 6 months.
Out of fine amount, Rs.1,00,000/- shall be paid to the complainant as compensation.
Bail bond of accused stands cancelled.
(Dictated to the Stenographer, directly on computer and then corrected by me and pronounced in the open court, on this the 1st day of January 2016.) BASAVARAJ CHENGTI XL ACMM, BANGALORE SCCH-14 16 CC No.16485/2013 ANNEXURE LIST OF WITNESSES EXAMINED ON BEHALF OF THE COMPLAINANT:
PW.1 - Ravindra D.R
PW.2 - Nataraj.K.R
LIST OF DOCUMENT MARKED ON BEHALF OF THE
COMPLAINANT:
Ex.P.1 - Cheque
Ex.1(a) - Signature of the accused
Ex.P2 - Bank memo
Ex.P3 - Copy of legal notice
Ex.P4 - Postal receipt
Ex.P5 - Postal acknowledgments
Ex.P6 - Authorisation letter
Ex.P7 - Certificate
Ex.P7(a) - Signature of the witness as Ex.P7
LIST OF WITNESSES EXAMINED ON BEHALF OF THE DEFENCE:
DW.1 B.K.Anand
DW.2 Venugopala Reddy B.K
DW.3 Basavaraj
DW.4 Srinivasa K
LIST OF DOCUMENTS MARKED ON BEHALF OF THE DEFENCE:
Ex.D.1 - Account extract
Ex.D2 - Account statement
XL ACMM,
BANGALORE.
SCCH-14 17 CC No.16485/2013
Dt;01.01.2016
C-ULS
A-SDK
For Judgment
Order pronounced in open court
vide separate judgment.
ORDER
The accused is found guilty and is convicted
U/s 255(2) of Cr.P.C. for the offence punishable U/s 138 of Negotiable Instruments Act.
The accused is sentenced to pay a fine of Rs.1,10,000/-. In default of payment of fine, the accused shall undergo SI for a period of 6 months.
Out of fine amount, Rs.1,00,000/- shall be paid to the complainant as compensation.
Bail bond of accused stands cancelled.
XL ACMM, BANGALORE