Bangalore District Court
Smt.V.Nalini vs Sri.G.Shankare Gowda on 2 September, 2022
1
C.C.No.11260/2017
KABC030263772017
IN THE COURT OF THE XVI ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE, BENGALURU CITY
Dated : This the 02nd day of September 2022.
Present: Sri.N.M. RAMESHA, B'Com.,L.L.M.
XVI Addl.C.M.M., Bengaluru City.
Case No. C.C.No
: C.C.No.11260/2017
Complainant : Smt.V.Nalini,
W/o. Sri.Venkataramu.R.,
Aged about 74 years,
R/at No.001, Ground Floor,
Pristine Pride Apartment,
Uttarahalli Main Road,
Padmanabhanagar, Bengaluru.
Represented by her GPA Holder:
Smt.Jyothi.V.
W/o.M.L.Krishan,
Aged about 36 years,
R/at No.001, Ground Floor,
Pristine Pride Apartment,
Uttarahalli Main Road,
Padmanabhanagar, Bengaluru.
(By Sri.Y.S.H.Reddy, Adv,)
V/s
Accused : Sri.G.Shankare Gowda,
S/o.Galappa,
2
C.C.No.11260/2017
R/at No.107/A,
O.B.Choodahalli,
Udayapura Post,
Kanakapura Main Road,
Bengaluru South Taluk,
Bengaluru-560062.
(By Sri.Kumara.B., Adv.,)
Case instituted : 20-03-2017
Offence complained of : U/s 138 of N.I Act
Plea of Accused : Pleaded not guilty
Final Order : Accused is Acquitted.
Date of order : 02-09-2022
JUDGMENT
The Complainant represented by her General Power of Attorney Holder has filed this complaint against the accused under the provisions of Sec.200 of the Code of Criminal Procedure, for the offence punishable U/Sec.138 of the Negotiable Instruments Act.
2. The case of the Complainant is as under:-
The accused and his wife Smt.M.Suma Shankaregowda have jointly purchased a house property situated in site No.725 of Kadirenahalli Layout, Padmanabhanagar from the complainant under the registered sale deed dated 30.03.2016 for Rs.1,20,00,000/-. At the time of execution of sale deed, 3 C.C.No.11260/2017 the accused had informed the complainant that in view of certain Income Tax issues which the accused was facing and to avoid payment of additional stamp duty and registration fee, the accused wanted to show only guideline value of the property for Rs.70,15,000/- as sale consideration in the sale deed. Therefore, an amount of Rs.70,15,000/- shown in the sale deed dated 30.03.2016. The accused has paid an amount of Rs.59,44,840/- by way of cheque dated 30.03.2016, Rs.10 lakhs by way of cheque dated 30.03.2016 and an amount of Rs.70,150/- to the Income Tax department towards TDS. The accused has offered to pay balance sale consideration of Rs.49,85,000/- by way of cash to the complainant. The complainant had refused to accept such huge cash amount and requested to pay by way of demand draft. The accused had informed the complainant that in the event of the complainant needs the balance sale consideration in white money, the accused could pay part of the amount only by way of post dated cheques and not by a demand draft. The complainant by believing the words of the accsued and in view of the complainant has already sold the property in favour of the complainant, the complainant had accepted to receive the post dated cheques and a small amount of money by way of cash from the accused 4 C.C.No.11260/2017 towards the balance sale consideration. Therefore, the accused had paid the balance sale consideration of Rs.49,85,000/- by way of cheque dated 23.09.2016 for Rs.24 lakhs, cheque dated 16.11.2016 for Rs.18 lakhs, cheque dated 30.01.2017 for Rs.5,50,000/- and Rs.2,35,000/- by way of cash. The complainant has encashed the cheque dated 23.09.2016 and 16.11.2016 for Rs.24 lakhs and Rs.18 lakhs respectively.
3. It is further averred in the complainant that the complainant has presented the cheque before M/s.National Co-operative Bank, BSK II Stage branch, Bengaluru for encashment. But the said cheque was came to be returend unpaid with an endorsement as "Payment Stopped By Drawer" dated 31.01.2017. Therefore, the complainant got issued a legal notice dated 15.02.2017 calling upon the accused to pay the cheque amount Rs.5,50,000/- within 15 days from the date fo receipt of legal notice. The said notice was returned with a postal endorsement "Not Claimed R/S.". The accused in spite of issuance of legal notice has refused to receive the notice and failed to pay the cheque amount and thereby committed an offence punishable U/s.138 of N.I.Act. Hence, this complaint.
5C.C.No.11260/2017
4. After presentation of complaint, it was ordered to be registered as PCR No.3972/2017 vide order dated 20.03.2017. The Sworn statement of the complainant has been recorded and the documents were as per Ex.C.1 to C.9.
5. My Learned predecessor in office having heard the arguments of the learned counsel for complainant and having satisfied with the complaint averments, sworn statement of the complainant and documents at Ex.C.1 to C.9 and having satisfied with the prima-facie materials placed on record, has taken the cognizance for the offence punishable U/s.138 of N.I.Act and the case was ordered to be registered in C.C.No.11260/2017 and process was ordered to be issued against the accused vide order dated 11-04-2017.
6. On service of summons, the accused has appeared before the court through his learned counsel and obtained the bail vide order dt: 22-01-2018 by furnishing surety. The copies of all the prosecution papers were supplied to accused.
7. The plea of accused has been recorded for the offence punishable U/s.138 of N.I.Act and the substance of accusation has been read over and explained to 6 C.C.No.11260/2017 accused in the language known to him. The accused has pleaded not guilty, but claims to be tried.
8. In order to establish the guilt against the accused, the GPA holder the complainant has been examined as PW-1 and got the documents marked as EX.P.1 to P.17.
9. The statement of accused as contemplated under the provisions of Section 313 of Cr.P.C has been recorded and the incriminating evidence as such forthcoming against the accused in the evidence of complainant has been read over and explained to the accused in the language known to him. The accused has denied the entire evidence of complainant. The accsued did choose to enter the defence evidence.
10. In order to substantiate his defence, the accused got himself examined as D.W.1 and got the documents marekd as Ex.D.1 to D.67.
11. I have heard the arguments of learned counsel for both the side. The learned counsel for complainant has also filed notes of arguments. I have perused the oral and documentary evidence placed on record.
12. Now, the points that would arise for my consideration are as under:-
7C.C.No.11260/2017
1. Whether the Complainant proves that the accused was due for Rs.5,50,000/-towards the balance sale consideration and therefore, he has issued a cheque bearing No.000035 dated 30.01.2017 for Rs.5,50,000/- in her favour M/s.HDFC Bank Ltd., Jayanagar branch, Bengaluru towards the legally recoverable debt and on presentation of cheque for encashment on 30.01.2017, it was came to be dishonoured with endorsement dated 30.01.2017 as "Payment Stopped by Drawer" and inspite of issuance of legal notice dated 15.02.2017 and in spite of service of legal notice, the accused has faield to pay the cheque amount and thereby committed an offence punishable U/s.138 of N.I.Act?
2. What Order?
13. On considering the oral and documentatry evidnece placed on record, now my answer to the above points are as under :
Point No.1: In the Negative.
Point No.2: As per final order for the following :
REASONS
14. Point No.1 :-The provisions of Sec.118 of Negotiable Instrument Act deals about presumptions as to neogtiable instruments. As per this provisions of law, unit the contrary is proved, the following presumptions 8 C.C.No.11260/2017 shall be made:-(a) of consideration: that every negotiable instrument was made or drawn for consideration and that every such instrument, when it has been accepted, indorsed, negotiated or transfered, was accepted, indorsed, negotiated or transferred for considertaion: (b) as to date: that every negotiable instrument bearing a date was made or drawn on such date; (c) as to time of acceptance- that every accepted bill of exchange was accpted within a reasonable time after its date and before its maturity. (d) as to time of transfer-that every transfer of a negotiable instrument was made before the maturity; (e) as to order of indorsement; that the indorsements appearing upon a negotiable instrument were made in the order in which they apear thereon; (f) as to stamps-that a lost promissory note, bill of exchange or cheque was duly stamped and (g) that holder is a holder indue course- that the holder of a negotiable instrument is a holder in due course.
15. The provisions of Sec.138 of Negotiable Instrument Act deals about dishonour of cheque for insufficiency etc., of funds in the accounts. As per this provisions of law, where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or 9 C.C.No.11260/2017 inpart, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall without prejudice to any other proviosn of this Act, be punished with imprisonment for a term which may be extended to two years or with fine which may extend to twice the amount of the cheque or with both.
16. As per the proviso attached to the above said provisions of law, nothing contained in this section shall apply unless-(a) the cheque has been presented to the bank within a period of three months from the date on which it is drawn or within the period of its validity, whichever is earlier. (b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice, in writing , to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid, and (c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the 10 C.C.No.11260/2017 cheque, within fifteen days of the receipt of the said notice.
[ 17. The provisions of Sec.139 of Negotiable Instrument Act deals about presumption in favour of holder. As per this provisions of law, it shall be presumed, unles the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, or any debt or other liability.
18. Now keeping the above said provisions of law in mind, let us consider as to whether the complainant could able to fulfill all the mandates, ingredients, terms and conditions of Section 138 of N.I.Act so as to raise a presumption in her favour as contemplated under the provisions of Section 118 and 139 of N.I.Act.
19. It is averred in the complaint and stated by PW-1 in her oral evidence that the accused and his wife Smt.M.Suma Shankaregowda have jointly purchased the house in site No.725 of Kadirenahalli village under the registered sale deed dated 30.03.2016 for consideration of Rs.1,20,00,000/- and at the time of execution of sale deed, the accused had informed that in view of certain income tax issues which was faced by the accused and in order to to avoid payment of additional stamp duty 11 C.C.No.11260/2017 and registration fee, the accused wanted to show ony guideline value of the property of Rs.70,15,000/- as sale consideration in the sale deed and not the actual value agreed sale consideration of Rs.1,20,00,000/- and accordingly, an amount of Rs.70,15,000/- was shown in the sale deed dated 30.03.2016 and the accused has paid an amount of Rs.59,44,850/- through cheque dated 30.03.2016, Rs.10 lakhs by way of cheque dated 30.03.2016 and an amount of Rs.70,150/-. The accused has agreed to pay the balance sale consideration of Rs.49,85,000/- to the complainant by way of cash for which the complainant has refused to accept such huge cash and requested to pay by way of Demand draft, but the accused had informed that in the event of the complainant needs balance sale consideration in white money, he would pay part of the same only by way of post dated cheques and not by way of D.D. and therefore, by believing the words of the accused, she has accepted to receive the post dated cheques and a small amount of money by way of cash towards the balance sale consideration. Therefore, the accused has paid balance sale consideration of Rs.49,85,000/- to the complainant by way of cheque dated 23.09.2016 for Rs.24 lakhs, cheque dated 16.11.2016 for Rs.18 lakhs, 12 C.C.No.11260/2017 cheque dated 30.01.2017 for Rs.5,50,000/- and Rs.2,35,000/- by way of cash.
20. It is further averred in the complaint and stated by PW-1 in her oral evidence that she had encashed two cheques dated 23.09.2016 and 16.11.2016 for Rs.24 lakhs and Rs.18 lakhs respectively. It is further averred in the complaint and stated by PW-1 in her evidence that she has presented the cheque No.000035, dated 30.01.2017 for Rs.5,50,000/- M/s.National Co-operative Bank Ltd, BSK II Stage, Bengaluru which was returned unpaid with an endorsement dated 31.01.2017 as "Payment Stopped By Drawer". Therefore, she has issued a legal notice dated 15.02.2017 calling upon the accused to pay the cheque amount within 15 days from the date of receipt of legal notice which was returned with a postal endorsement "Not claimed R/S" and the accused has failed to pay thte cheque amount and hence, she has lodged a complaint before the Court.
21. The complainant has produced the GPA dated 18.03.2017, cheque dated 30.01.2017, bank endorsement dated 31.01.2017, legal notice dated 15.02.2017, postal receipt dated 15.02.2017, postal cover, postal receipt, postal acknowledgement, Indian 13 C.C.No.11260/2017 Income Tax Return Verification Form for the assessment year 2016-17, certificate under 65-B Indian Evidence Act, notices dated 19.01.2017, postal receipt dated 19.01.2017 and they are marked at Ex.P.1. to P.17.
22. The accused neither disputed the issuance of cheque in favour of the complainant nor his signature on the chque or presentation of cheque or return of cheque as unpaid or issuance of Stop Payment or issuance of legal notice. On the other hand, it is suggested to PW-1 and it is also the evidence of accused/DW-1 that he came in contact with the complainant in the month of February 2016 and purchased the property under the sale deed dated 30.03.2016 for Rs.70,15,000/- and as there was necessity for renovation of house, she had assured to complete the renovation work through her son-in-law Krishna with cost of Rs.47,50,000/- within 9 months from the date of registration of sale deed and therefore, they have entered into a renovation agreement and he has issued four post dated cheques for Rs.47,50,000/- towards the cost of renovation in favour of the complainant out of which one cheque was dated 23.09.2016 for Rs.24 lakhs, second cheque was dated 16.11.2016 for Rs.16 lakhs, 3rd cheque was dated 16.11.2016 for Rs.2 lakhs and 4th cheque was dated 14 C.C.No.11260/2017 31.1.2017 for Rs.5,50,000/- and three cheques were duly honoured. But the son-in-law of the complainant had not commenced the renovation work and the whereabouts of the complainant was not known and therefore, he has contacted the complainant over a phone and enquired regarding renovation work.
23. It is also the evidence of DW-1 that on 27.12.2016, he got issued a legal notice to the complainant calling upon her to return the amount of Rs.24 lakhs, Rs.16 lakhs and Rs.2 lakhs so that he could get the renovation of the work done and he has informed the complainant through the legal notice that otherwise he is going to issue the Stop payment instructions to the Bank in respect of fourth cheque for Rs.5,50,000/-. But there was no response on the part fo the complainant and therefore, on 30.01.2017, he has issued stop payment instructions to the Banker.
24. So from these material suggestions put to PW- 1 and evidence of DW-1 coupled with documents placed on record, it is crystal clear that the accused by necessary implication has admitted the transaction of purchase of property under the registered sale deed, issuance of cheque, presentation of cheque, dishonour of cheque including his signature on the cheque.
15C.C.No.11260/2017
25. However, the complaint avermetns, oral evidence of PW-1 and documentary evidence at Ex.P.1 to P.17 would establish that the accused and his wife have purchased the proeprty from the complainant under the registered sale deed dated 30.03.2016 vide Ex.D.2 for Rs.70,15,000/- and the accused has paid Rs.59,44,850/- by way of cheque dated 30.03.2016, Rs.10 lakhs by way of cheque dated 30.03.2016 and paid an amount of Rs.70,150/- to the income tax department towards TDS.
26. The materials placed on record would also indicate that the accused has drawn the cheque vide Ex.P.2 from the account maintained by him in his banker and issued the said cheque in favour of the complainant and his signature also finds a place in the said cheque as per Ex.P.2(a). The complainant has presented the cheque for encashment on 30.01.2017 which was came to be returend unpaid with an endorsement as "Payment Stoped By Drawer" vide Ex.P.3 dated 31.01.2017 and therefore, the complainant has issued a legal notice dated 15.02.2017 vide Ex.P.4 which was not claimed by the accused.
16C.C.No.11260/2017
27. So, it is crystal clear that the complainant has presented the cheque within its validity and also issued the notice within the stipulated time from the date of receipt of bank endorsement and since the accused has failed to pay the cheque amount, the complainant has presented the complaint before the Court on 20.03.2017 which is well within time. So, it is crystal clear that the complainant has fulfilled the mandates of Section 138 of N.I.Act and therefore, the presumption is in favour of the complainant as per Section 118 and 139 of N.I.Act.
28. Admittedly, the presumption available in favour of the complainant U/s.118 and 139 of N.I.Act are not conclusive proof, but they are rebuttable in nature. Therefore, when once the compainant has fulfilled the mandates of Section 138 of N.I.Act and when once the Court has drawn the presumption in favour of the complainant U/s.118 and 139 of N.I.Act, then the onus shifts on the accused to rebut the statutory presumption in favour of the complainant U/s.118 and 139 of N.I.Act.
29. The learned counsel for the complainant has argued with force that the oral evidence of PW-1 read with documentary evidence at Ex.P.1 to P.17 clearly establishes that the accused has issued a cheque in 17 C.C.No.11260/2017 question towards the legally recoverable debt and on presentation of cheque for encashment, it was came to be dishonoured and therefore, the complainant has issued a legal notice well within the stipulated time from the date of receipt of bank endorsement and the accused has failed to pay the cheque amount and therefore, complainant has presented the complaint before the Court which is well within time. The complainant has fulfilled all the mandates of Section 138 of N.I.Act and therefore, the presumption is in favour of the complainant U/s.118 and 139 of N.I.Act. The accused has not seriously disputed the issuance of cheque and his signature on the cheque and therefore, the presumption is in favour of the complainant.
30. It is further contended that the accsued has taken a defence that there was an agreement for renovation of house and therefore, he has issued four cheques and the renovation work has not been done and the complainant has not responded to his notice and therefore, he has issued a Stop payment Instructions to the banker and therefore, he is not liable to pay any cheque amount, but the defence taken by the accused has not been proved before the Court. Nothing is elicited in the evidence of PW-1. The oral evidence of DW-1 and documentary evidence at Ex.D.1 to D.67 do not 18 C.C.No.11260/2017 establish the defence taken by the accused. The accused has admitted that he has not produced documentary evidence before the Court to show that he has spent Rs.50 lakhs for renovation and he has no impediments to prepare a statement of expenses regarding renovation work and to produce the bill of estimate and the accused also not produced any documents in this regard.
31. It is further contended that later on the accused has created and concocted the documents at Ex.D.20 to D.67 and produced the same before the Court. But the accused has not produced the bills and estimation and therefore, the documents at Ex.D.20 to D.67 are not come in the way of accused to prove his defence. The accused has created the documents at Ex.D.20 to D.67 and deposed false evidence before the Court with an intention to avoid the payment of cheque amunt of Rs.5,50,000/- and the accused has failed to prove the probable defence and hence, the accused is liable for conviction and liable to pay the cheque amount as per Section 138 of N.I.Act.
32. Per contra, the learned counsel for the accused has vehemently contended that the oral evidence of PW-1 and documents at Ex.P.1 to P.17 do not indicate the existence of legally recoverable debt and 19 C.C.No.11260/2017 also issuance of cheque in question towards the legally recoverable debt and the complainant has failed to fulfill all the mandates of Section 138 of N.I.Act and therefore, the presumption is not in favour of the complainant.
33. It is further contended that the oral evidence of DW-1 coupled with documentary evidence at EX.D.1 to D.67 clearly establishes that the accused has purchased the property from the complainant for Rs.70,150/- and there was an agreement between the complainant and accused for renovation of work and therefore, the accused has issued four cheques out of which three cheques were encashed. But the complainant and his son-in-law had not commencned the renovation work and the where abouts of the complainant was not known and therefore, the accused has issued notice dated 27.12.2016 calling upon the complainant to complete the renovation work. But the complainant and son-in-law have not completed the renovation work and therefore, the accused has issued a Stop Payment Instructions to the banker and therefore, the ingredients of Section 138 of N.I.Act does not attract and since the complainant has failed to prove the guilt against the accused and since the accused has raised a probable defence and proved the same before the Court, the accused is entitled to an order of acquittal.
20C.C.No.11260/2017
34. Now keeping the arguments canvassed by the learned counsel for both sides including the provisions of Section 118, 138 and 139 of N.I.Act, in mind, let us consider as to whether the accused could able to rebut the presumption available in favour of the complainant U/s.118 and 139 of N.I.Act.
35. It is the specific defence of the accused and the evidence of DW-1 that he came in contact with the complainant in the month of February 2016 and purchased the house property from the complainant under the registered sale deed dated 30.3.2016 for Rs.70,15,000/- and the complainant had told that there was necessity to take up some renovation work and assured to complete the renovation work through her son in law for an amount of Rs.47,50,000/-. Therefore there was an agreement between them for renovation work and he has issued four post dated cheques for Rs.47,50,000/- out of which three cheques dated 23.09.2016 for Rs.24 lakhs, cheque dated 16.11.2016 for Rs.16 lakhs and Rs.2 lakhs were encashed. But the complainant and son-in-law had not commenced the renovation work and their where abouts were not known and therefore, he has issued legal notice calling upon the complainant to return the amount. But there was no 21 C.C.No.11260/2017 response from the complainant and therefore, he has issued a stop payment instructions on 30.01.2017.
36. In order to substantiate his defence, the accused has produced the sale agreement cum agreement for renovation of building/house dated 30.03.2016, certified copy of sale deed dated 30.03.2016, legal notice dated 24.12.2016, 16 photographs, quotation, estimation, 45 tax invoices and they are marked at Ex.D.1 to D.67.
37. It is suggested to DW-1 that the value of the property which he has purchsed from the complainant is Rs.1,20,00,000/-; that he has not got renewed the house; that he has paid Rs.49,85,000/- to the complainant towards the balance sale consideration; that in order to avoid the payment of proper stamp paper and registration charges, by showing the less consideration in the sale deed, he has concocted and created the document at Ex.D.1; that he has issued cheques shown in cluase-2 of page No.4 of Ex.D.1 for the period after 9 months from the date of the said agreement; that the sale agreement has been prepared by his Auditor; that apart from the sale consideration shown in the sale deed at Ex.D.2, he has paid 22 C.C.No.11260/2017 Rs.2,35,000/- to the complainant as part of sale consideration amount.
38. But all these material suggestions have been specifically denied by D.W.1. Therefore, it is said that the denied suggesions are always remained as suggestions only and not come in the way of complainant either to substantiate her case or to falsify the probable defence taken by the accused or to falsify the oral evidence of DW-1 or to falsify the documentary evidence at Ex.D.1 to D.67 or to substantiate that the accused has issued cheque in question towards the balance sale consideration and not for renovation expenses.
39. However, there is no material suggestions D.W.1 as to how and in what manner the accused has concocted and created the documents at Ex.D.1 to D.67. If really the accused has concocted and created the documents at Ex.D.1 to D.67, then there must have some material suggestions in this regard D.W.1 as to how and in what manner the accused has concocted and created documents at Ex.D.1 to D.67. Nothing is elicited in the evidence of DW-1 to show that the accused has issued cheque in question towards the balance sale 23 C.C.No.11260/2017 consideration and not for renovation expenses of the house.
40. In fact, the complainant has not specifically denied the issuance of legal notice by the accused calling upon him to comply the terms and conditions of agreement vide Ex.D.1 or return the amout paid towards renovation expenses. On the other hand, it is suggested to DW-1 that the said legal notice at Ex.D.3 has been issued by him and called upon the complainant to return back the amount of Rs.47,50,000/- in her favour and till notice vide Ex.D.3 was issued, cheque was not presented. It is also suggested to DW-1 that as per Ex.D.3 in page No.4 of Ex.D.3, the renovation work had to be completed within 9 months from the date of said agreement. It is also suggested to DW-1 that the money is required for the purpose of renovation. However, the complainant has not complied the terms and conditions of an agreement vide Ex.D.1 and also not completed the renovation work or atleast return the renovation expenses paid by the accused.
41. It is also forthcoming in the evidence of DW-1 that he got renovated the house outside and inside with the help of labours commencing from 25.01.2017 and he has spent an amount of Rs.50 lakhs for renovation 24 C.C.No.11260/2017 work. It is also forthcoming in the evidence of DW-1 that he had given notice in writing to the complainant calling upon her not to present the cheque in dispute for encashment in view of the alleged non compliance of the renovation work. However, the complainant has presented the cheque in question.
42. According to complainant that the cheque in question vide Ex.P.2 was issued towards the balance sale consideration. But according to accused that the cheque in question was issued towards the renovation work and there was also an agreement in this regard. But the complainant has failed to fullfill the terms and conditions of renovation agreement vide Ex.D.1 and therefore, he has issued a notice to the complainant calling upon her either to complete the renovation work or to refund the amount of Rs.47,50,000/-. But the complainant has not fulfilled the terms and conditions and therefore, he has issued a notice and and also issued stop payment instructions to the banker.
43. But the complainant has not placed any materials to show that the accused has issued a cheque in question towards either for balance sale consideration or towards legally recoverable debt. But on the other hand, the accused has produced the sale agreement 25 C.C.No.11260/2017 dated 30.03.2016, sale deed dated 30.03.2016, legal notice dated 24.12.2016, photographs and they are marked at EX.D.1 to D.19. The complainant has not seriously disputed the genuniness, authenticity and validity of these documents at EX.D.1 to D.19. But on the other hand, when documents at Ex.D.1 to D.19 were confronted to PW-1, she has admitted and therefore, the said documents are marked as per Ex.D.1 to D.19 through PW-1 during her cross-examination.
44. As could be seen from the document at Ex.D.1, there was an agreement between the complainant and accsued in respect of renovation of work of the house and therefore, the accused has issued four cheques bearing No.000030 dated 23.09.2016, 000033, dated 16.11.2016, 000010 dated 16.10.2016 and 000035 dated 30.1.2017 for Rs.24 lakhs, Rs.16 lakhs, Rs.2 lakhs and Rs.5,50,000/- respectively. As per the recitals of Ex.D.1, the complainant being the first party has agreed and taken the responsibility for renovating the schedule house property and she was at liberty to appoint choice of Engineer and Labourers and use the first grade and good materials available in the market for constructional purpose and the complainant has agreed to renovate and complete the construction within 9 months from the date of agreement with grace 26 C.C.No.11260/2017 period of one month and the complainant has to effectively make the plan for alteration or renovation under the guidelines of qualified Engineeres or with their knowledge and she is at liberty to make cost effectively estimate for entire building renovation. But the complainant has not placed any materials to show that she has complied the terms and conditions of the agreement vide Ex.D.1.
45. As could be seen from the document at Ex.D.2, sale consideration is mentioned as Rs.70,15,000/- and not Rs.1,20,00,000/- as contended by the complainant. The complainant has not placed any materials to show that the accused has purchased the property under the registered sale deed vide Ex.D.2 for Rs.1,20,00,000/- and the accused has issued the said four cheques towards the balance sale consideration. But on the other hand, the document at Ex.D.2 itself would indicate that the complainant has sold the property to the accused for Rs.70,15,000/- and not for Rs.1,20,00,000/-. The entire case made out by the complainant is against to the recitals of sale deed vide Ex.D.2. The complainant has not disclosed about the receipt of four cheques towards the renovation work. Therefore, the entire case made out by the complainant is against to the recitals of docuement at Ex.D.1 and 2.
27C.C.No.11260/2017
46. As could be seen from the document at Ex.D.3, the accused has issued a notice calling upon the complainant to commence the renovation work or to refund the amount. The complainant has not disputed the service of legal notice vide Ex.D.3. But the complainant has not fulfilled the terms and conditions of agreement vide Ex.D.1 and also demand made in the notice vide Ex.D.3. As could be seen from the documents at Ex.D.4 to D.19 photographs, the accused has undertaken the renovation work of the house purchased from the complainant through contractor and labours.
47. As could be seen from the documents at Ex.D.20 to D.22, the complainant has obtained a quotation for innovation work and estimations and thereafter, he has purchased the building materials and completed renovation work. This is so evident from the document at Ex.D.20 to D.67 which are quotations, estimations and tax invoices.
48. The complainant all the while in her complaint averments and PW-1 all the while in her affidavit chief- examination as stated that the accused has issued cheque in question towards the balance sale consideration and therefore, she has presented the cheque for encashment which was came to be returned 28 C.C.No.11260/2017 unpaid with an endorsement as Payment Stopped by the Drawer". But PW-1 has completely go-bye to her own contents of the complaint and also contents of affidavit and categorically admitted that her mother has sold the property to the accused and there, was an agreement titled as Sale agreement cum agreement for renovation/alteration of building/house prior to the sale deed. But the complainant has suppressed these facts in her complaint and PW-1 also suppressed these facts in her affidavit in chief-examination.
49. Even according to PW-1 that she has not produced any documents before the Court to show that they have sold the property to the accused for Rs.1,20,000,00/-. PW-1 has not disputed the contents and recitals of sale deed vide Ex.D.2. So, it is crystal clear that the complainant has sold the property for Rs.70,15,000/- to the accused and not for Rs.1,20,00,000/-. Because, PW-1 has categorically admitted that sale consideration of Ex.D.2 is Rs.70,15,000/- under Ex.D.2 and consideration is shown as Rs.70 lakhs as they have sold the property for Rs.70 lakhs and not for Rs.1,20,00,000/-.
50. Though the complainant has contended that the accused has issued the cheque in question towards 29 C.C.No.11260/2017 the balance sale consideration, but PW-1 has admitted that as per the recitals of Ex.D.1, they have to get the house property renovated and altered. It is also admitted by PW-1 that as per recitals of Ex.D.1, the cost of renovation and alteration of the house was shown as Rs.47,50,000/- which substantiated the probable defence taken by the accused. It is also admitted by PW- 1 that towards the payment of said amount of Rs.47,50,000/-, four cheques which are mentioned in page No.4 of Ex.D.1 were issued by the accused in favour of her mother. However, the complainant has suppressed all these materials facts with respect to terms and conditions of Ex.D1. and recitals of Ex.D.2 in her complaint and even PW-1 also suppressed all these facts in her affidavit chief-examination. No such explanation as such forthcoming either in the complaint or in the legal notice or in the affidavit chief-examination for non disclousure of these material facts. Therefore, an adverse inference has to be drawn against the case made out by the complainant.
51. It is also admitted by PW-1 that the first three cheques were encashed by her mother and as per the terms of the agreement at Ex.D.1, they have to get their house property renovated within 9 months from the date of the said agreement. But the complainant has not 30 C.C.No.11260/2017 complied with terms and conditions of document at Ex.D.1. It is also admitted by PW-1 that as per the terms of the said agreement vide Ex.D.1, they have not got done the renovation of their house within 9 months from the date of said agreement as agreed by them. It is also admitted by PW-1 that since they did not get the renovation work done as agreed, the accused and his wife got issued the legal notice to her mother.
52. PW-1 has also admitted the signature of her mother in page No.1 to 6 of document at Ex.D.1 and they are marked at Ex.D.1(a). The photographs were confronted to PW-1 and they are marked at EX.D.4 to D.19 which substantiates the probable defence taken by the accused. It is also admitted by PW-1 that after purchase of the house, it is who the accused got renovated and white washed the house as could be seen from the documents at Ex.D.4 to D.19. It is also admitted by PW-1 that after having got renovated the house, the accused had issued a notice to her mother on 24.12.2016 calling upon her to pay the expenses that he had incurred towards the cost of the renovation which was supposed have been got done by them.
53. It is also admitted by PW-1 that they have presented the cheque in dispute after the receipt of the 31 C.C.No.11260/2017 legal notice dated 24.12.2016 issued by the accused and after the receipt of the legal notice that was caused to her mother by the accused, the accused had not instructed to present the cheque in dispute. However, the complainant has presented the cheque for encashment for the reasons best known to her. It is also admitted by PW-1 that they have not produced any documents before the Court in support of their claim that an amount of Rs.47,50,000/- was paid towards the balance sale consideration amount and not for renovation charges. So, it is crystal clear that it is who the accused has completed the renovatin work. But the complainant has failed to return the amount received from the accused towards renovation expenses, but presented the cheque for encshment without the knowledge of the accused.
54. On appreciation of entire oral and documentary evidence placed on record, it is found that the accused and his wife have purchased a property from the complainant under Ex.D.2 dated 30.3.2016 for Rs.70,15,000/- and the accused has paid an amount of Rs.59,44,850/- through cheque dated 30.03.2016, Rs.10 lakhs through cheque dated 30.03.2016 and also paid an amount of Rs.70,150/- to the income tax department towards TDS. The materials on record would 32 C.C.No.11260/2017 also indicate that there was an agreement between the complainant and accused vide Ex.D.1 dated 30.03.2016 in respect of renovation/alteration of building/house and the complainant being the first party has agreed and undertaken the responsibility for renovating the house property and to appoint an Engineer and labours and to use first grade and good materials available in the market for constructional purpose within 9 months from the date of agreement with grace period of one month and to make cost effective estimation for entire building renovation. In this regard, the accused has issued cheques bearing No.000030 dated 23.09.2016 for Rs.24 lakhs, cheque No.000033 dated 16.11.2016 for Rs.16 lakhs, cheque No.000010 dated 16.11.2016 for Rs.2 lakhs and cheque No.000035 dated 30.01.2017 for Rs.5,50,000/- drawn on HDFC Bank, Jayanagar branch, Bengaluru towards the renovation work in favour of the complainant.
55. The materials on record would also indicate that the complainant has encashed all the first 3 cheques. But after execution of sale deed and agreement vide Ex.D.1 and D.2 and after payment of agreed amount by the accused, the complainant has failed to commence the renovation work. Therefore,the accused got issued a legal notice vide Ex.D.3 dated 33 C.C.No.11260/2017 24.12.2016 calling upon the complainant to return the amount encashed by her. But in spite of service of legal notice, the complainant neither commenced the renovation work nor returned the amount and thereby failed to comply the terms and conditions of agreement vide Ex.D.1 including demand made by the accused in the legal notice vide Ex.D.3. Therefore, the accused without any alternative option has issued Stop Payment Instructions to the bank and therefore, based on the intimation given by the accused, the Bank has issued an endorsement vide Ex.P.3 as Payment Stopped by Drawer".
56. It is pertinent to note here that the cheque in question neither dishonoured for want of sufficient funds in the account of the accused nor for exceeding the payment. But on the other hand, it was came to be returned with an endorsement as Payment Stopped By Drawer". Since the complainant has failed to comply the terms and conditions of the agreement vide Ex.D.1 and demand made by the accused in Ex.D.3, the accused has issued Stop Payment Instructions. The materials on record would indicate that since the complainant has failed to commence the renovation work and failed to comply the terms of agreement vide Ex.D.1 and demand made in Ex.D.3, the accused without any alternative 34 C.C.No.11260/2017 option has obtained the quotation of innovation work and estimate vide Ex.D.20 to D.22 and purchased the building materials for renovation work as per invoice vide Ex.D.23 to D.67 and completed the renovation work as shown in Ex.D.4 to D.19. Under these circumsances, it cannot be said that the accused has issued the cheque towards the balance sale consideration and for legally recoverable debt. Therefore, the defence taken by the accused that cheque vide Ex.P.1 was not issued for balance sale consideration, but it was issued for renovation work for which the complainant has failed to commence the renovation work and thereby failed to fulfill the terms and conditions of agreement vide Ex.D.1 and also demand made in Ex.D.3 is seems to be more probable than that of case made out by the complainant.
57. It is well settled position of law that the liability and security are two distinct entitities and both cannot be mixed or acted upon simultaneously. If the act of a person in discharge of liability is not done, then the security comes into picture. If the act in discharge of a liability is performed, then the security would not have any legal force. In the present case, the complainant has not fulfilled the terms and conditions of agreement vide Ex.D.1 and demand made in Ex.D.3 legal notice. Under these circumstances, there was no option for the 35 C.C.No.11260/2017 accused but to issue Stop payment instructions to the Banker. Therefore, he has issued the Stop payment instructions and accordingly, the banker has issued an endorsement vide Ex.P.3. Under these circumstances, it cannot be said that the accsued has issued the cheque towards the balance sale consideration or towards the legally recoverable debt.
58. Under these circumstances, the argument of the learned counsel for the complainant that the accused has issued the cheque in question towards the balance sale consideration and also for legally recoverable debt and thereby the complainant has fulfilled all the mandates of Section 138 of N.I.Act and the cheque was dishonoured and therefore, the accused is liable to pay the cheque amount as the complainant has proved the guilt against the accsued with oral evidence of PW-1 and documentary evidence at EX.P.1 to P.17 and since, the accused has failed to prove the probable defence, the accsued is liable to pay the cheque amount as per 138 of N.I.Act is not sustainable under law and therefore, cannot be accepted.
59. On the other hand, there is some legal and considerable force in the submission of the learned counsel for the accused that the cheque in question was 36 C.C.No.11260/2017 not issued for balance sale consideration, but it was issued towards the renovation work, but, the complainant after receiving the amount from the accsued has failed to fulfill the terms and conditions of the agreement vide Ex.D.1 and also demand made by thte accused in the legal notice vide Ex.D-3 and therefore, the accsued has issued a legal notice vide Ex.D.3 calling upon the complainant to return the amount or to commence work, but the complainant has failed to commence work and also failed to return the amount and therefore, the accused has issued a Stop Payment instructions to the Bank and thereafter, he has obtaiend the quotation and estimation and purchased the building materials and completed the renovation work and the accused has raised the probable defence and also proved the same before the Court with oral evidence of DW-1 and documentary evidence at Ex.D.1 to D.67 and also by eliciting the material facts in the evidence of PW-1, but the complainant has failed to prove the guilt against the accused with legal evidence before the Court and therefore, the accused is not liable to pay any cheque amount to the complainant.
60. Therefore, for the reasons discussed above, this Court is of thte considered view that the materials placed on record do not establish the guilt against the 37 C.C.No.11260/2017 accused for the offence punishable U/s.138 of N.I.Act. Hence, I hold that the complainant has failed to prove charges levelled against the accused for the offence punishable U/s.138 of N.I.Act. Hence, I answer the point No.1 in the Negative.
61. Point No.2: In view of my findings on point No.1, I proceed to pass the following:-
ORD ER The accused is found not guilty for the offence punishable U/s.138 of Negotiable Instruments Act.
Hence, acting U/sec.255(1) of Cr.P.C. the accused is hereby acquitted for the offence punishable U/sec.138 of N.I.Act.
The bail bond and surety bond of the accused shall be in force till the appeal period is over as contemplated under the provisions of Sec.437(A) of Cr.P.C.
(Dictated to the stenographer, transcribed by him, print out taken by him, verified, corrected and then pronounced by me in the open Court on this the 02nd September 2022).
(N.M.RAMESHA) XVI ACMM, Bengaluru City.38
C.C.No.11260/2017 ANNEXURE
1. List of witness/s examined on behalf of the Complainant:-
P.W.1 : Nalini
2. List of documents exhibited on behalf of the Complainant:-
Ex.C.1 : Original GPA. Ex.C.2 : Original cheque. Ex.C.2(a) : Signature of accused. Ex.C.3 : Bank Memo. Ex.C.4 : Copy of Legal Notice. Ex.C.5 : Postal Acknowledgement. Ex.C.6 : Notice. Ex.C.7 : Postal Cover. Ex.C.8 : Receipt. Ex.C.9 : Acknowledgement. Ex.C.10 : I.T.R. Ex.C.11 : 65-B Certificate. Ex.C.12 : Reply. Ex.C.13 : Receipt. Ex.C.14. : Notice. Ex.C.15 : Cover. Ex.C.16 ; Receipt. Ex.C.17 : Acknowledgement.
3. List of witness/s examined on behalf of the Accused:-
DW.1 : G.Shankare Gowda.
39
C.C.No.11260/2017
4. List of documents exhibited on behalf of the Accused:-
Ex.D.1 : Sale Agreement.
Ex.D.1(a) : Signature..
Ex.D.2 : Deed of Absolute Sale.
Ex.D.3 : Legal Notice.
Ex.D.4 to D.13 : Photos.
Ex.D.20 : Quotation.
Ex.D.21 & 22 : Estimation.
Ex.D.23 to 67 : Tax Invoices.
(N.M.RAMESHA)
*mbh XVI ACMM, Bengaluru City.