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2013 DIGILAW 1143 (KAR)

MURIGEPPA MAHANTAPPA BANDI v. G. S. KAMALDINNI

2013-09-20

ANAND BYRAREDDY

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JUDGMENT ANAND BYRAREDDY, J.-Heard the learned counsel for appellant. The learned counsel for respondent remains absent. 2. The appellant was the complainant before the trial Court alleging an offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as 'N.I. Act', for brevity). 3. It was the case of complainant that the respondent-accused was known to complainant and he borrowed a loan of Rs. 1,50,000/- from him on 01.09.2004 agreeing to repay the same within 15 days. But there was default in such repayment. And on repeated demands for repayment of the said loan, he had issued two cheques bearing Nos. 072041 and 072042 for Rs. 75,000/- each. The first one dated 15.09.2004 and the second one dated 16.10.2004, respectively, were drawn on Malaprabha Grameena Bank, Harugeri branch. When the same were presented for collection through the Malaprabha Grameena Bank Handigund branch, they were returned with an endorsement that they were dishonoured for want of funds in the account on 18.12.2004. The complainant had thereafter issued notice dated 04.01.2005 through registered post and also certificate of posting notice was duly served on the respondent. Since there was non-compliance with the demand for repayment, the complaint was filed. The respondent having entered appearance, contested the matter and pleaded not guilty and claimed to be tried. The complainant having tendered his evidence, the parties were heard and Court below framed the following points for consideration- (1) Whether the complainant proves that the accused in order to repay the hand loan of Rs. 1,50,000/- issued Exs.P-1 and 3 cheques in favour of complainant and said cheques came to be dishonoured for the reasons 'funds insufficient" and accused failed to pay the cheque amount within stipulated period and thereby the accused committed the offence punishable under Section 138 of the N.I. Act? (2) Whether the accused proves that Exs.P-1 and 3 cheques were issued in favour of complainant in connection with money transaction in respect of securing the job to the son of the complainant and the money transaction between complainant and accused is against the public policy and the agreement between the parties is void and it is not enforceable. Hence the complainant cannot enforce the said agreement? (3) What order? 4. The Court below held point No. 1 in the negative and point No. 2 in the affirmative and acquitted the accused. Hence the complainant cannot enforce the said agreement? (3) What order? 4. The Court below held point No. 1 in the negative and point No. 2 in the affirmative and acquitted the accused. It is that which is under challenge in the present appeal. 5. The learned counsel for the appellant-petitioner would submit that the cheques having been issued on the account of the respondent is not denied. The signatures on the cheques are not denied and the fact that they were dishonoured for want of sufficient funds is also on record. There was compliance with issuance of the notice of demand and the complaint having been filed in time, and therefore, the presumption of the cheques having been issued in discharge of a legal liability was in favour of the holder of the cheques namely the complainant. Hence, the respondent, who denied the liability and sought to raise the defence that the cheques had not been issued in discharge of any legal liability but were issued as security for having paid certain monies to the respondent in connection with securing a job for the son of complainant, and therefore, the transaction was not one which could be enforced and hence there was no legal liability in discharge of which the money had been paid. The transaction, if it was an unlawful transaction cannot be enforced and if cheques had been issued as security for repayment of such money, the same also could not be enforced as there was no legally enforceable debt that was involved. The trial Court while conceding that the complaint satisfied all the requirements of establishing an offence punishable under Section 138 of N.I. Act, however, has addressed the defence raised and has found favour with the respondent in holding that admittedly the complainant's son was unemployed and was seeking employment. The respondent was a retired Police Officer, and further since it was the defence set up by the respondent that certain monies had been received by him on the assurance of procuring employment for the son of complainant, and therefore, the same could not be legally recovered as the transaction was an unlawful transaction. Consequently, any cheques issued as security for the repayment of the money could not also be enforced and has relied on case law to this effect and has acquitted the accused. 6. Consequently, any cheques issued as security for the repayment of the money could not also be enforced and has relied on case law to this effect and has acquitted the accused. 6. The learned counsel for appellant would point out that even if it is true that the complainant's son was unemployed and monies had been paid to the respondent in consideration of him securing such employment, the Court below having arrived at such a conclusion was not supported by any evidence of the accused. Firstly, as a retired Police Officer he was not in a position to provide any employment to the son of complainant. Secondly, there was no case put forward by the respondent-accused to establish that he was in a position to secure employment for the son of the complainant through the medium of some other person and there was no evidence tendered or any material placed before the Court in this regard except furnishing copies of application forms made out in the name of son of the complainant to claim that he was in possession of the copies of the application forms whereby the son of the complainant was seeking employment and that itself was sufficient proof of the complainant having paid money to the accused to procure employment for his son and hence the learned counsel would submit that the presumption that arises under Section 139 of N.I. Act being a rebuttal presumption, it would mean that the respondent should be in a position to place material before the Court sufficient to create a preponderance of probability as to the defence being raised in discharge of the presumption, it is only then the burden would shift to the complainant to establish that there was no such transaction and hence would seek intervention of this Court. 7. On consideration of the facts and circumstances, the point for consideration is, whether the Court below was justified in accepting the defence set up by the accused to the effect that there was a transaction which was unlawful namely, that the money that had been paid by the complainant was in consideration of the respondent securing employment for the complainant's son, which was unlawful and therefore, the cheques issued by the accused as security for due repayment if he failed to secure such employment was also unenforceable. 8. 8. The mere production of copies of application forms filed on behalf of the son of the complainant would not establish the transaction at all. It does not raise a preponderance of probability to accept the case of the respondent. It was also necessary either to establish that the respondent was holding a position of power whereby he could provide such employment which was admittedly not the position, or that he was capable of influencing some other person in power who could provide such employment to the son of the complainant. This is also not forthcoming. Therefore, the mere production of application forms filled up in the name of the complainant's son, which was in the possession of the respondent by itself did not establish any such unlawful transaction which was pleaded. The Court below was not justified in holding that the cheques were issued as security for the due repayment of money which was received in consideration in an unlawful transaction, and therefore, neither the transaction or the cheques could be enforced is a finding that cannot be sustained. Consequently, the appeal is allowed. The judgment of the Court below is set aside. The offence punishable under Section 138 of N.I. Act stands established. The respondent is convicted to pay a fine of Rs. 2,30,000/-, of which Rs. 2,25,000/- shall be paid as compensation to the appellant in terms of Section 357 of the Code of Criminal Procedure, 1973. In default of such payment, the respondent shall suffer imprisonment of six months.