Bangalore District Court
Shakthi Mookambika Chits Pvt. Ltd vs Madesh P on 5 November, 2024
SCCH-2 1 C.C.No.4959/2018
KABC020267952018
IN THE COURT OF THE VI ADDL. JUDGE, COURT OF
SMALL CAUSES AND ADDL. CHIEF JUDICIAL
MAGISTRATE, BENGALURU CITY (SCCH-2).
C.C.NO.4959/2018
Present : Sri. H.P. Mohan Kumar, B.Sc.,LL.B.,
6th Addl. Judge, Court of Small
Causes and ACJM, Bengaluru.
Dated: On this the 5th day of November, 2024.
Complainant : M/s Shakthi Mookambika
Chits Pvt Ltd., (R),
No.7, 2nd Floor,
Sridevi Complex,
Basavanagudi,
Bengaluru-560 004.
Rep. by its Proprietor
Sri. Rajanna G.H.
(By Sri. U.H.S./G.H., Advocate)
- Vs -
Accused : Sri. Madesh P.,
Son of Late Puttaswamy,
Aged about 38 years,
Residing at No.21/1-1,
22nd Cross, 1st Main Road,
K.P. Agrahara,
SCCH-2 2 C.C.No.4959/2018
Magadi Main Road,
Bengaluru-560 023.
And also at:
Shop No.39/1,
Ground Floor,
1st Main, Mount Joy Extension,
NCP Towers,
Hanumanthanagar,
Bengaluru-560 019.
(By Sri. G.M.G., Advocate)
JUDGMENT
The complainant has filed the present complaint U/Sec.200 of Cr.P.C., alleging that the accused has committed the offence punishable U/Sec.138 of Negotiable Instruments Act (herein after referred as N.I.Act).
2. The case of the complainant in brief is as follows:-
The complainant is running a registered chit business. The accused is one of the subscriber of chit amount of Rs.9,00,000/- commencing on 21.02.2017 by paying monthly installment of Rs.39,139/- for the period of 23 consecutive months. On 21.05.2017, the accused was the highest bidder. Accordingly, after deducting the bid amount of 40%, the complainant has paid the remaining amount of Rs.5,40,000/- to the accused by way of cash. The accused has undertook to pay the remaining 21 monthly chit installment amount to the SCCH-2 3 C.C.No.4959/2018 complainant by executing an agreement. For which one Rakesh son of Gundappa stood as surety. Thereafter, the accused became chronic defaulter in paying monthly chit installments. As per the account statement, the accused has paid Rs.2,20,000/- and he is liable to pay Rs.6,80,000/- to the complainant. After several requests of the complainant and as per settlement taken place in Panchayath, the accused came forward to settle the dispute. In order to discharge the legal debt, the accused has issued a cheque bearing No.000153, dated:30.08.2018 for a sum of Rs.6,80,000/-, drawn on ICICI Bank Ltd., Banashankari III Stage Branch, Bengaluru in favour of complainant. The accused has assured to honour the cheque on its presentation.
The complainant has presented the aforesaid cheque for encashment through its banker namely Syndicate Bank, Gavipuram Branch, Bengaluru. However, the said cheque got bounced for the reason "Account Closed" and returned with an endorsement dated:01.09.2018. Thereafter, the complainant has issued a legal notice dated:29.09.2018 to the accused through RPAD. The said notice sent to the accused was returned on 03.10.2018 with shara as "Unclaimed Door Locked, Intimation Delivered". In-spite of knowledge of dishonour of cheque, the accused has not SCCH-2 4 C.C.No.4959/2018 repaid the amount. Hence, cause of action arose to file the complaint.
3. The cognizance was taken for the offence punishable U/Sec.138 of N.I.Act. After filing of the complaint, the sworn statement of the complainant was recorded and it prima-facie found that the accused has committed the offence punishable U/Sec.138 of N.I.Act. Hence, criminal case was registered and the summons was issued to the accused.
4. In response to the summons, the accused appeared through his counsel and thereafter plea was recorded. The accused denied the accusation leveled against him, claimed to be tried and stated that he has defence to make. In the instant case, the statement of the accused as contemplated U/Sec.313 of Cr.P.C., was recorded. The accused denied the incriminating evidence appeared against him in the evidence of complainant and submitted that he has defence evidence.
5. The Hon'ble Apex Court of India in Indian Bank Association and Others vs Union Bank of India and Another reported in AIR 2014 SC 2528, held that "Sworn Statement of the complainant has to be treated as examination in chief". In instant case, the proprietor of the complainant got examined as P.W.1 and produced as many as 7 documents which have marked as Ex.P.1 to Ex.P.4, Ex.P.3(a), Ex.P.3(b) and Ex.P.4(a). P.W.1 was subject to the SCCH-2 5 C.C.No.4959/2018 process of cross-examination from the side of accused. It is relevant to note that, Ex.D.1 and Ex.D.2 were marked by way of confrontation during the course of cross-examination of P.W.1. The accused examined himself as D.W.1. Thereafter, D.W.1 was subject to the process of cross-examination from the side of complainant in part.
6. Heard the arguments of learned counsel for the accused. No arguments addressed from the side of complainant. Perused the materials available on record.
7. Now the points that emerge for consideration of this Court are as hereunder:
1. Whether the complainant has proved that the accused has committed the offence punishable U/Sec.138 of N.I.Act?
2. What Order?
8. The findings of this Court to the above-referred points are as follows:
Point No.1: In the Negative.
Point No.2: As per final order,
for the following:-
SCCH-2 6 C.C.No.4959/2018
REASONS
9. POINT No.1: In order to prove the case of the complainant, the proprietor of the complainant examined himself as P.W.1 by filing affidavit in support of his oral examination-in-chief. In the affidavit P.W.1 has reiterated the complaint averments in verbatim. Hence, this Court need not to recapitulate the same once again at this juncture. In support of his oral testimony, P.W.1 has marked documents at Ex.P.1 to Ex.P.4 and Ex.P.3(a), Ex.P.3(b) and Ex.P.4(a). P.W.1 was cross-examined from the side of accused. It is relevant to note that, Ex.D.1 and Ex.D.2 were marked by way of confrontation during the course of cross-examination of P.W.1. Per-contra the accused examined himself as D.W.1 and he was cross-examined in part from the side of complainant. In other words the evidence of D.W.1 was not completely challenged.
10. Now itself it is appropriate to see the documents marked as Ex.P-Series and Ex.D-Series.
Ex.P-Series.
Ex.P.1 is the cheque in question. Ex.P.1(a) is the signature of accused. Ex.P.2 is the bank endorsement. Ex.P.3 is the office copy of the legal notice dated:29.09.2018. Ex.P.3(a) and Ex.P.3(b) are the RPAD receipts. Ex.P.4 is the returned postal cover. Ex.P.4(a) is the unserved legal notice.
SCCH-2 7 C.C.No.4959/2018Ex.D-Series.
Ex.D.1 is the Xerox copy of pass book issued by the plaintiff company to the accused. Ex.D.2 is the statement of account pertaining to the accused.
11. Before going to discuss the main aspect, it is worth to reproduce the provisions of Sec.138 and 139 of N.I.Act, the same as hereunder:
138. Dishonour of cheque for insufficiency, etc., of funds in the account: -
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 in part, 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 provisions of this Act, SCCH-2 8 C.C.No.4959/2018 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:
Provided that nothing contained in this section shall apply unless-
(a) the cheque has been presented to the bank within a period of Six months from the date on which it is drawn or within the period of its validity, whichever is earlier; (The period of 6 months has been reduced to 3 months, vide R.B.I. notification No.RBI/2011-12/251,DBOD.AML BC No.47/14.01.001/2011-12, dated:4th November 2011 (w.e.f. 01.04.2012))
(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 SCCH-2 9 C.C.No.4959/2018 due course of the cheque, within fifteen days of the receipt of the said notice.
Explanation: - For the purposes of the section, "debt or other liability" means a legally enforceable debt or other liability.
139. Presumption in favour of holder:- It shall be presumed, unless 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, of any debt or other liability.
12. At this juncture, it is worth to refer the decision of the Hon'ble Apex Court reported in AIR 2010 S.C. 1898, between Rangappa V/s Mohan wherein their lordships have observed at para 26 as hereunder:
"No doubt that there is a initial presumption which favours the complainant".
13. It is germane to note that the proceedings U/Sec.138 of N.I. Act is an exception to the general principle that the accused is presumed to be innocent until the charge leveled against him is proved beyond reasonable doubt. In the proceedings initiated U/Sec.138 of the N.I. Act proof of beyond reasonable doubt is subject to the presumption SCCH-2 10 C.C.No.4959/2018 envisaged under Sec.139 of the N.I. Act. Once the requirement of Sec.138 of the N.I. Act is fulfilled, then it has to be presumed that the cheque was issued in discharge of legally recoverable debt or liability. The presumption envisaged under Sec.139 of N.I. Act is mandatory presumption and it has to be raised in every cheque bounce cases.
14. Now the time has to see whether the complainant has complied the ingredients of Sec.138 of N.I. Act or not?. In this connection Ex.P.1 to Ex.P.4, Ex.P.3(a), Ex.P.3(b) and Ex.P.4(a) are relevant for discussion. Accordingly, Ex.P.1 is the cheque in question. Ex.P.2 is the bank endorsement dated:01.09.2018. Ex.P.3 is the office copy of legal notice dated:29.09.2018. Ex.P.3(a) and Ex.P.3(b) is the RPAD receipts. Ex.P.4 is the returned postal cover and Ex.P.4(a) is the unserved legal notice. On careful perusal of Ex.P.1 to Ex.P.4, it is crystal clear that, the complainant has presented the cheque in question within the stipulated time and thereafter he has issued the legal notice dated:29.09.2018 as per Ex.P.3 within 30 days from the date of receiving the information regarding bouncing of cheque. As per Ex.P.3(a) and Ex.P.3(b), the complainant has dispatched the notice on 29.09.2018 itself.
15. On perusal of Ex.P.4, the notice issued by the complainant was returned with shara as "unclaimed, door SCCH-2 11 C.C.No.4959/2018 locked, intimation delivered". It is relevant to state that the object of issuance of notice to the drawer is to provide an opportunity to pay the cheque amount within 15 days of service of notice and thereby free himself from the penal consequences of Sec.138 of Negotiable Instruments Act. In this regard, it is worth to rely on the decision of Hon'ble Apex Court reported in 2007(6) SCC 555, between C.C. Alavi Haji vs Palapetty Muhammed & Anr, Wherein the Hon'ble Apex Court held as hereunder: " Section 27 gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. In view of the said presumption, when stating that a notice has been sent by registered post to the address of the drawer, it is unnecessary to further aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business. This Court has already held that when a notice is sent by registered post and is returned with a postal endorsement refused or not available in the house or house locked or shop closed or SCCH-2 12 C.C.No.4959/2018 addressee not in station, due service has to be presumed".
16. The above referred decision is aptly applicable to the case on hand. In the instant case, the notice has returned with shara as unclaimed and intimation delivered. Therefore, with the help of principles laid down by the Hon'ble Apex Court in the decision referred to above, this court has come to the conclusion that, the service of notice issued by the complainant amounts to deemed service.
17. It is relevant to note that, as per Ex.P.2, the bank has issued the endorsement as "Account Closed". Now the important question before this court is whether the endorsement "Account Closed" attracts the offence punishable under section 138 of N.I.Act or not?. In this regard it is worth to rely on the decision of the Hon'ble Apex Court reported in 2012(13) SCC 375 between Laxmi Dyechem V/s State of Gujarath, wherein the Hon'ble Apex Court held at para 16 as hereunder: "the expression 'amount of money...... is insufficient' appearing in Sec.138 of the Act is a genus and dishonour for reasons such as "Account Closed", "Payment stopped", "referred to the drawer", are only species of that genus". Therefore, with the help of the above referred decision of the Hon'ble Apex Court ,it is crystal clear that, if the endorsement issued SCCH-2 13 C.C.No.4959/2018 by the bank as "Account Closed" also attracts an offence punishable under section 138 of N.I Act.
18. Apart from that, the accused has clearly admitted in his chief-examination that, he has issued one signed blank cheque to the complainant. It is pivotal to note that, the accused has not disputed the cheque and signature found in Ex.P.1. Therefore, it is crystal clear that, Ex.P.1 is pertaining to the bank account of accused and signature found in Ex.P.1 is that of his signature. In addition to that, as per Sec.118 and Sec.139 of N.I. Act, presumption favours the complainant. Hence, the complainant has complied the ingredients of Sec.138 of N.I. Act.
19. Now, it is worth to refer the decision of the Hon'ble Apex Court between Hiten P Dalal V/s Brathindranath Manarji reported in 2001(6) SCC 16, wherein the Hon'ble Apex Court observed that, "under Sec.138 of Negotiable Instruments Act, the complainant is not required to establish either the legality or enforceability of the debt or liability since he can avail the benefit of presumption U/Sec.118 and Sec.139 of N.I. Act in his favour".
20. It is also settled position of law that, the presumption available U/Sec. 138 of N.I Act is a rebuttable presumption. Further, to rebut the said presumption the accused need not to enter into the witness box. However, the accused can SCCH-2 14 C.C.No.4959/2018 establish her probable defence bly creating a doubt about the existence of legally enforceable debt or liability.
21. Further, it is also settled position of law that, the standard of proof of rebutting the presumption is that of preponderance of probabilities. It is also settled position of law that, if the accused succeeded in rebutting the presumption, then the burden shifts back to the complainant. At this juncture, again it is worth to refer the decision of the Hon'ble Apex Court reported in AIR 2010 S.C. 1898, between Rangappa Vs. Sri. Mohan, wherein the Hon'ble Apex Court has observed that, "the standard of proof to rebut the presumption is that one of preponderance of probabilities". It is also settled position of law that, "it is immaterial that, the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque otherwise valid, within the provisions of Sec.138 would be attracted".
22. Now the next question before this Court is whether the accused has rebutted the presumption or not?. According to complainant, the accused was the chit subscriber for the chit amount of Rs.9,00,000/-. The accused was the highest bidder and after deducting 40% of bid amount, the complainant has paid Rs.5,40,000/- to the accused on 21.05.2017. Between the complainant and SCCH-2 15 C.C.No.4959/2018 accused, the settlement was taken-place, at which point of time, the accused has issued the cheque in question towards discharge of his liability.
23. In the instant case, accused has examined himself as D.W.1. In his examination-in-chief, he has deposed that, on 16.03.2017 the complainant has deducted Rs.20,000/- and issued the cheque for Rs.5,20,000/-. However the said cheque was bounced with the reason as funds insufficient. Thereafter, the complainant prolonged the matter. Till August, he has paid the chit amount every month. At the time of issuing the cheque by the complainant, the complainant obtained the signed blank cheque, signed on demand promissory note, his office address and surety address. Therefore, it is crystal clear that, the accused has stoutly denied the payment of bid amount pertaining to chit by the complainant institution.
24. Now, the question before this Court is whether the complainant has paid the bid amount of Rs.5,40,000/- to the accused or not as alleged in the complaint?. On careful perusal of notice and complaint averments, the complainant has nowhere stated regarding issuance of cheque in favour of accused towards payment of bid amount and the same was bounced. It is relevant to note that, during the course of cross-examination of P.W.1, he has clearly admitted the cheque was got bounced. At this juncture itself it is worth to SCCH-2 16 C.C.No.4959/2018 reproduce the said cross-examination of P.W.1 here itself for better understanding: "ನನ್ನ ಮತ್ತು ಆರೋಪಿಯ ನಡುವೆ ಈ ಚೀಟಿ ವ್ಯವಹಾರ ಬೆಟ್ಟು ಬೇರೆ ಏನಾದರೂ ವ್ಯವಹಾರ ಇದೆಯಾ ಎಂದರೆ ಇಲ್ಲ. ದಿಃ16.03.2017 ರಂದು ನಮ್ಮ ಶಕ್ತಿ ಮೂಕಾಂಬಿಕ ಚಿಟ್ ಫಂಡ್ ನಿಂದ ರೂ.5,20,000/- ಮೌಲ್ಯದ ಆರೋಪಿ ಹೆಸರಿಗೆ ಕೊಟ್ಟಿದ್ದ ಚೆಕ್ ಆತನ ಖಾತೆಗೆ ಹೋಗಿ ಬೌನ್ಸ್ಆಗಿದೆ ಅದು ಯಾವ ವ್ಯವಹಾರಕ್ಕೆ ಸಂಬಂಧಪಟ್ಟಿದೆ ಎಂದರೆ ಬಿಡ್ ಕರೆದ ದಿವಸ ನಾವು ಆರೋಪಿಗೆ ರೂ.5,40,000/- ಮೊತ್ತಕ್ಕೆ ರೂ.20 ಸಾವಿರವನ್ನು ಕಟ್ ಮಾಡಿಕೊಂಡು ರೂ.5,20,000/- ಕ್ಕೆ ಚೆಕ್ಕನ್ನು ಕೊಟ್ಟೆವು, ಆದರೆ ಅದನ್ನು ಅವರು ಬೌನ್ಸ್ ಮಾಡಿಕೊಂಡು ಬಂದಿದ್ದಾ ರೆ ನಂತರ ವ್ಯವಹಾರ ಮಾಡಲು ಸಮಸ್ಯೆ ಆಗಿದೆ ಹಣವನ್ನೇ ಕೊಡಿ ಎಂದು ಆರೋಪಿ ಮತ್ತು ಅವರ ಸ್ನೇಹಿತ ರಾಕೇಶ್ ಕೇಳಿದ್ದರಿಂದ ನಂತರ ನಾವು ರೂ.5,20,000/- ನಗದು ಹಣ ಕೊಟ್ಟೆವು".
25. It is pivotal to note that, why the complainant has suppressed the issuance of cheque to the accused and also its bouncing in his notice and the complaint is not forthcoming before this Court. The suppression of material facts creates a serious doubt with regard to the case of the complainant. It is not the case of complainant that, after taking bounced cheque back from the accused, the complainant has given bid amount to the accused by way of cash. If really the complainant has paid the bid amount to the accused by way of cash, what was the impediment for the complainant to take consideration receipt from the accused is not forthcoming. In other words, there are no documents forthcoming from the side of complainant with regard to the accused has received the bid amount of Rs.5,20,000/-. Therefore, it can be inferred that, the complainant has not SCCH-2 17 C.C.No.4959/2018 paid the bid amount to the accused as alleged in the complaint. Further, it can also be inferred that, the cheque in question was issued by the accused at the time of receiving the cheque from the complainant. Hence, the accused has raised the plausible defence and contentions of accused regarding the cheque in question was issued at the time of receiving the cheque from the complainant is nearer to the truth. It is needless to mention that, the evidence of accused was not fully challenged.
26. Further, based on the materials available on the record it can also be inferred that, there is no alleged liability of accused with respect to the amount mentioned in the cheque. Further, it can be inferred that, the complainant in order to make wrongful gain, he has presented the cheque by filling the amount. Therefore, this court holds that, the accused has raised plausible defence and successfully rebutted the presumption available in favour of the complainant. Further, the accused creates a doubt in the mind of this Court with regard to the case of complainant. It is pertinent to note that, once the accused has rebutted the presumption, the burden shifts back to the complainant. However, the complainant has failed to prove his case. Hence, this court holds that, the complainant has failed to prove that, the accused has committed an offence punishable SCCH-2 18 C.C.No.4959/2018 Under Sec. 138 of Negotiable Instruments Act. Accordingly, this Court is answered Point No.1 in the Negative.
27. Point No 2 : In view of the above findings, this Court proceeds to pass following:
:O R D E R:
Acting U/Sec.255(1) Cr.P.C., the accused is acquitted of the offence punishable under Section 138 of Negotiable Instruments Act, 1881.
The bail bond of the accused and his surety shall stands cancelled. (Dictated to Stenographer directly on computer and typed by her, revised and corrected by me, and then pronounced in the open Court on this the 5th November, 2024) (H.P. Mohan Kumar) VI Addl. Judge and ACJM., Court of Small Causes, Bengaluru.
:ANNEXURE:
LIST OF WITNESSES EXAMINED BY THE COMPLAINANT:
P.W.1 : Sri. Rajanna G.H. LIST OF DOCUMENTS MARKED ON BEHALF OF COMPLAINANT: Ex.P.1 : Original Cheque No.000153, dated:30.08.2018.
Ex.P.1(a) : Signature of accused.
SCCH-2 19 C.C.No.4959/2018
Ex.P.2 : Bank endorsement dated:01.09.2018.
Ex.P.3 : Office copy of legal notice dated:29.09.2018.
Ex.P.3(a) : 2 RPAD receipts.
& 3(b)
Ex.P.4 : Returned postal cover.
Ex.P.4(a) : Unserved legal notice.
LIST OF WITNESSES EXAMINED BY THE ACCUSED:
D.W.1 : Sri. Madesh.
LIST OF DOCUMENTS MARKED ON BEHALF OF ACCUSED: Ex.D.1 : Xerox copy of pass book issued by the plaintiff to accused.
Ex.D.2 : Bank Account Statement pertaining to accused.Digitally signed by H P
HP MOHANKUMAR
MOHANKUMAR Date:
2024.11.12
17:25:14 +0530
(H.P. Mohan Kumar)
VI Addl. Judge and ACJM.,
Court of Small Causes,
Bengaluru.