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2020 DIGILAW 1802 (KAR)

P. Guruswamy v. S. Raju

2020-09-15

H.B.PRABHAKARA SASTRY

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JUDGMENT H.B.Prabhakara Sastry, J. - In the complaint filed by the present respondent under Section 200 of Code of Criminal Procedure, 1973, against the present petitioners for the offence punishable under Section 138 of Negotiable Instrument Act, 1881 (hereinafter for brevity referred to as 'N.I.Act'), the learned XXII Addl.Chief Metropolitan Magistrate & XXIV Addl.Small Causes Judge, Bengaluru City (hereinafter for brevity referred to as 'trial Court'), by the judgment of conviction and order on sentence dated 14.11.2006, passed in C.C.No.15773/2003, convicted the accused for the said offence and sentenced him accordingly. Aggrieved by the same, the accused preferred an appeal before the learned Presiding Officer, Fast Track Court-I, Bengaluru City, (hereinafter for brevity referred to as 'Fast Track Court'), in Criminal Appeal No.1911/2006, which also by its judgment dated 14.2.2011, while dismissing the appeal, confirmed the judgment of conviction and order on sentence impugned before it. Being aggrieved by the same, the accused has preferred this Revision Petition. 2. The summary of the case of the complainant in the trial Court is that accused No.1 is the Proprietor of accused No.2, who was doing business in transporting heavy equipments. The accused came in contact with the complainant in his business relations and they developed a good and cordial relationship. At the instance of the accused, the complainant agreed to associate with him in the business. Since the accused, who was based at Chennai, wanted to start a Branch in Bengaluru, has offered for taking the complainant as a General Manager of Bengaluru Branch on a monthly salary of Rs. 20,000/- per month or 50% of the profit of business operations in Bengaluru, which was agreed by the complainant. The accused induced the complainant to deposit a sum of Rs. 10 lakhs, which amount the complainant had with him earned from his previous employment with M/s.Deutesche Babcock Ltd., The accused offered to pay interest on the said sum at the rate of 2.5% per month i.e., Rs. 25,000/- per month. The said amount of Rs. 10 lakhs was to be treated as a fixed security deposit as complainant's share of capital. They also contemplated to have a Partnership Firm between them. The said sum of Rs. 10 lakhs was paid to the accused by the complainant on 4.4.1998, in consideration of the same, the accused issued a receipt of the even date. 10 lakhs was to be treated as a fixed security deposit as complainant's share of capital. They also contemplated to have a Partnership Firm between them. The said sum of Rs. 10 lakhs was paid to the accused by the complainant on 4.4.1998, in consideration of the same, the accused issued a receipt of the even date. He also issued an open cheque to the complainant for the similar sum of Rs. 10 lakhs under cheque bearing No.655045, drawn on Canara Bank, ICE House, Chennai, with an authority to the complainant to present the same in the event of breach of agreement between them regarding the payment of interest on the said sum. The accused paid the interest on the said security deposit only for few months. Thereafter, he stopped paying the interest on the security deposit, as well the agreed salary to the complainant at the rate of Rs. 20,000/- per month or 50% of the profit. This made the complainant to tender his resignation on 28.6.2003. As agreed between them, the complainant presented the said cheque issued by the accused for a sum of Rs. 10 lakhs for encashment through his banker on 28.6.2003, however, the cheque returned dishonoured with an endorsement dated 2.7.2003 stating that 'the account of the drawer was closed'. The complainant demanding the cheque amount, issued a legal notice dated 17.7.2003 both by Registered Post Acknowledgement Due and under Certificate of Posting. The accused gave an untenable reply dated 1.8.2003 to the notice, however, did not paid the cheque amount. This constrained the complainant to institute a criminal case against the accused for the offence punishable under Section 138 of N.I.Act. 3. The accused appeared through his counsel and contested the matter in the trial Court. In order to prove his case, the complainant examined himself as PW-1 and got marked documents from Exs.P-1 to P-22. The accused No.1 got himself examined as DW-1 and got marked documents from Exs.D-1 to D-8. 4. After hearing both side, the trial Court by its impugned judgment dated 14.11.2006, convicted the accused for the offence punishable under Section 138 of N.I.Act and sentenced him to pay a fine of Rs. 12,50,000/- and in default of payment of fine, to undergo simple imprisonment for a period of twelve months. Out of the realisation of the fine amount, an amount of Rs. 12,50,000/- and in default of payment of fine, to undergo simple imprisonment for a period of twelve months. Out of the realisation of the fine amount, an amount of Rs. 12,40,000/- was ordered to be given to the complainant by way of compensation and remaining Rs. 10,000/- was ordered to be appropriated to the State, which judgment of conviction and order on sentence is confirmed by the Fast Track Court. 5. The respondent is being represented by his learned counsel. 6. The trial Court and Fast Track records were called for and the same are placed before this Court. 7. Heard the arguments of learned counsel from both side and perused the materials placed before this Court. 8. For the sake of convenience, the parties would be referred to as per their ranks before the trial Court. 9. Learned counsel appearing for the petitioners submitted that both the trial Court, as well the Fast Track Court failed to notice that there was no legally enforceable debt as on the date of presentation of the cheque. Even according to the complainant, as per Exs.P-21, P-22 and D-4, the total amount due from the accused to the complainant was only a sum of Rs. 2,04,753/-. As such, despite the fact that the legal presumption was successfully rebutted by the accused, the trial Court, as well the Fast Track Court failed to notice the same which has led them to pass an erroneous judgments. 10. Per contra, learned counsel for the respondent/complainant in his argument submitted that it is not in dispute that the cheque in question was issued by the accused. When the issuance of cheque in favour of the complainant is proved, the presumption operates in favour of the complainant. He further submitted that Exs.P-21, P-22 and D-4 are inter-office memos pertaining to the business transaction between the complainant and the accused, but, it has got nothing to do with the security deposit given by the complainant to the accused. As such, the alleged outstanding liability of Rs. 2,04,753/- is a different transaction and unconnected with the cheque in question. He further submitted that the complainant being the General Manager of Bengaluru Branch of the accused No.2 establishment, was incurring office expenses and was sending inter-office memos to the accused who was stationed at Chennai, seeking reimbursement of the expenses incurred. 2,04,753/- is a different transaction and unconnected with the cheque in question. He further submitted that the complainant being the General Manager of Bengaluru Branch of the accused No.2 establishment, was incurring office expenses and was sending inter-office memos to the accused who was stationed at Chennai, seeking reimbursement of the expenses incurred. It is in that regard several of the inter-office memos were being issued to the accused. As such, it has got nothing to do with the amount of Rs. 10 lakhs paid by the complainant to the accused and the disnohoured cheque in question. Learned counsel also submitted that a reading of the evidence of the accused in its entirety goes to show that his conduct is highly doubtful and his evidence is contradictory at several points. He further submits that the accused as DW-1 has clearly admitted of he receiving a sum of Rs. 10 lakhs as loan. Thus, considering all these facts and circumstances of the case and the evidence led before it, both the trial Court, as well the Fast Track Court have rightly held the accused guilty of the alleged offence. 11. In the light of the above, the points that arise for my consideration is : " Whether the impugned judgments of conviction and order on sentence passed by the trial Court and the Fast Track Court suffers with any illegality or perversity warranting any interference at the hands of this Court?" 12. The evidence of the parties and the materials placed before the Court reveals certain facts as not in dispute that the complainant and the accused were known to each other. The accused was running a transport business with twentyfive Lorries, as such, he was a fleet owner. After acquainting with the complainant, who was an Ex-Senior Manager of M/s.Deutesche Babcock Ltd., at Bengaluru, the accused involved the complainant also in his business and opened a Branch Office of his establishment at Bengaluru, making the complainant as in-charge of the Bengaluru Branch though with a designation as a General Manager. The accused has not denied or disputed that the cheque at Ex.P-2 pertains to him and was issued by him in his capacity as a Proprietor of accused No.2. It is also not in dispute that the said cheque when presented for realisation, came to be dishonoured with the Banker's endorsement "account closed" as in the Banker's endorsement at Ex.P-3. The accused has not denied or disputed that the cheque at Ex.P-2 pertains to him and was issued by him in his capacity as a Proprietor of accused No.2. It is also not in dispute that the said cheque when presented for realisation, came to be dishonoured with the Banker's endorsement "account closed" as in the Banker's endorsement at Ex.P-3. It is also not in dispute that the complainant issued a legal notice demanding the cheque amount as per Ex.P-5, which was received by the accused as per the acknowledgements at Exs.P-8 to P-10 and replied to the complainant as per reply at Ex.P-11. In the said reply also, the accused has not denied the receipt of Rs. 10 lakhs by him from the complainant. However, in Para-5 of the reply notice, he has taken a contention that, out of the said amount of Rs. 10 lakhs, he has already repaid more than Rs. 7.95 lakhs and the remaining amount is only Rs. 2.05 lakhs. He has also taken a contention that the said sum of Rs. 2,04,753/- was also later paid by him (accused). Thus, at the very first instance, the accused has admitted the receipt of Rs. 10 lakhs by him from the complainant. The accused who got himself examined as DW-1, in his cross-examination, at one stage, stated that he does not know whether the complainant had lent him a sum of Rs. 10 lakhs. In the very next sentence, he again stated that within two to three months, the complainant lent him a loan of Rs. 10 lakhs. In the third sentence, in the same stretch, he has also stated that, he had taken the said amount as a loan for building a temple. Which means, though with certain inconsistencies with respect to the purpose of loan, the accused had categorically admitted receiving a sum of Rs. 10 lakhs by him from the complainant as a loan. Therefore, apart from the presumption of existence of legally enforceable debt under Section 139 of N.I.Act, the evidence led by the complainant and the materials placed by him clearly establishes that accused was due for a sum of Rs. 10 lakhs to the complainant, as such, there was a legally enforceable debt. Therefore, apart from the presumption of existence of legally enforceable debt under Section 139 of N.I.Act, the evidence led by the complainant and the materials placed by him clearly establishes that accused was due for a sum of Rs. 10 lakhs to the complainant, as such, there was a legally enforceable debt. However, the defence of the accused is that the said loan was cleared long back, as such, as on the date of presentation of the cheque, there existed no legally enforceable debt. When the accused has taken such a defence, it is for him to rebut the presumption which was formed in favour of the complainant, as well as to show that the evidence led by the complainant about the existence of the debt was not trustworthy. In that connection, the accused has mainly relied upon two documents produced by the complainant as inter-office memos and marked at Exs.P-21 and P-22 and one more similar inter-office memo produced by him and marked as Ex.D-4. By relying upon these documents, the accused has contended that the inter-office memo at Ex.P-21 shows that the complainant himself has stated that accused was due in a sum of Rs. 2,24,108/-. In another inter-office memo dated 19.6.2002, which is at Ex.P-22, the same complainant has stated that the accused was due for a sum of Rs. 2,04,753/-. Even in a subsequent inter-office memo dated 28.8.2002, which is at Ex.D-4, the complainant has reiterated the same amount i.e., Rs. 2,04,753/- as the total amount due. It is relying upon these three documents, the learned counsel for the accused vehemently submitted that, if at all any amount due is there, it is only Rs. 2,04,753/-, but, not the cheque amount, which is Rs. 10 lakhs. 13. Though the learned counsel for the accused/petitioners drew the attention of the Court to Ex.D-8, which is said be a Letter of Clearance said to have been given by the complainant stating that the matter has been finally settled and he has no claim against the accused, but, the learned counsel also fairly conceded that he would not dispute the finding given by both the trial Court, as well the Fast Track Court holding that Ex.D-8 is not a reliable document, as such, he would not press on the said exhibit. A perusal of the observation made by the trial Court, as well the Fast Track Court with respect to Ex.D-8 also go to show that, giving cogent reasons, they have held that Ex.D-8 is a suspicious document shown to have been given in the Letter Head of the accused establishment by its Proprietor when admittedly the complainant was not the Proprietor of the said establishment. They have also suspected the execution of the said document by the complainant. In the light of the same, the said Ex.D-8 which was seriously disputed by the complainant was not considered as a reliable document by both the trial Court, as well the Fast Track Court, which finding, I do not find fault with. As such, the only aspect that remains for consideration is whether Exs.P-21, P-22 and D-4 would show that, as on the date of presentation of the cheque, the outstanding liability was not the cheque amount of Rs. 10 lakhs, but, a far lesser amount than it. 14. Both PW-1 and DW-1 in their evidence have admitted that there used to be exchange of inter-office memos between them during the course of their business. It is also not in dispute that the alleged business of the accused was stationed at Chennai and its Bengaluru Branch was being taken care of by the complainant. However, the business was proprietorship concern, of which, the accused was the sole Proprietor, as such, the complainant had never been the owner or Proprietor of the business. Even according to the complainant, he was appointed as a General Manager of Bengaluru Branch of accused No.2 establishment. Even the accused No.1 also no where has stated that the complainant was the owner of the Bengaluru Branch. Therefore, the exchange of inter-office memos between them for business purpose is shown to be a fact. PW-1 in his further examination-in-chief though has admitted these inter-office memos, including Exs.P-21, P-22, D-1 and D-4, but, has specifically stated that the expenses shown therein and the balance amount as due shown therein were all towards the office expenses and has got nothing to do with the loan of Rs. 10 lakhs taken by the accused from him. PW-1 in his further examination-in-chief though has admitted these inter-office memos, including Exs.P-21, P-22, D-1 and D-4, but, has specifically stated that the expenses shown therein and the balance amount as due shown therein were all towards the office expenses and has got nothing to do with the loan of Rs. 10 lakhs taken by the accused from him. On the other hand, the accused though himself has produced Ex.D-4 after stating that the complainant was sending interoffice memos to him, but, stated that he does not know whether Ex.D-4 is their document and he also does not know whether he has submitted Ex.D-4 to the Court. He has also stated that he does not know whether he has seen Ex.D-4 in his office. The said conduct of the accused about himself expressing the doubt with respect to a document produced by him as an exhibit creates doubt regarding the trustworthiness of his evidence. That apart, even after taking into consideration Exs.P-21, P-22 and D-4, which are the inter-office memos, as the genuine correspondences made between them, still, a reading of the contents of those inter-office memos clearly go to show that those memos are shown to have been raised by AIM Transport, Bengaluru and addressed to Sri P.Guruswamy, AIM Transport, Chennai, which means, the Bengaluru Branch of accused No.2, which is under proprietorship of accused No.1, has sent those inter-office memos to its Proprietor at Chennai. The contents of those inter-office memos also clearly go to show that the complainant as a creator of those documents has given the details of the business expenses incurred by him at Bengaluru office for the relevant period and the amount received by him and after getting deduction to the amount received by him, has shown the balance amount as due from the proprietor of the establishment i.e., accused No.1. By looking into those documents and the evidence led by PW-1 and DW-1, it cannot be imagined that Exs.P-21, P-22 and D-4 in any way had any nexus to the loan amount of Rs. 10 lakhs received by the accused from the complainant. Therefore, the amount of Rs. 2,04,573/- shown as the balance amount due in Exs.P-22 and Ex.D-4 is clearly not a balance due in the loan amount of Rs. 10 lakhs received by the accused from the complainant. Therefore, the amount of Rs. 2,04,573/- shown as the balance amount due in Exs.P-22 and Ex.D-4 is clearly not a balance due in the loan amount of Rs. 10 lakhs, but, it is clear that the said balance is towards the office expenses claimed by the complainant and all those inter-office memos are clearly the business transaction memos which has got nothing to do with the loan amount of Rs. 10 lakhs. 15. The above point also gains support by the fact that when the accused has contended in his reply notice at Ex.P-11 that he has returned more than Rs. 7.95 lakhs to the complainant, but, has failed to produce even a single piece of paper in that regard. The accused being the businessman owing more than twentyfive Lorries under him is not expected to repay the documented loan in the form of cheque in substantial portion without any documentary evidence. Therefore, the accused by stating that he has cleared more than Rs. 7.95 lakhs though failed to prove the same, but, has admitted that he was due to pay a sum of Rs. 10 lakhs to the complainant. As such, the complainant's contention that he was entitled for a recovery of a sum of Rs. 10 lakhs from the accused stands re-established once again. On the other hand, the accused except taking the contention of alleged repayment of either the full amount or the substantial portion of it, neither could able to establish the same nor could show the preponderance of probabilities. 16. Both the trial Court, as well the Fast Track Court have analysed these aspects and have rightly held the accused guilty of the offence punishable under Section 138 of N.I.Act. Thus, I do not find any illegality, perversity or incorrectness in the judgment of conviction passed by the trial Court, as well the Fast Track Court. Further, the order on sentence passed by the trial Court, which was confirmed by the Fast Track Court since being proportionate to the gravity of the proven guilt, I do not find any reason to interfere in the judgments of conviction and order on sentence under appeal. 17. Accordingly, I proceed to pass the following order: ORDER The Criminal Revision Petition is dismissed as devoid of merits. 17. Accordingly, I proceed to pass the following order: ORDER The Criminal Revision Petition is dismissed as devoid of merits. The judgment of conviction and order on sentence passed by the learned XXII Addl.Chief Metropolitan Magistrate & XXIV Addl.Small Causes Judge, Bengaluru City, in C.C.No.15773/2003, dated 14.11.2006, which was confirmed by the learned Presiding Officer, Fast Tract Court-I, Bengaluru City, in Criminal Appeal No.1911/2006, dated 14.02.2011, is confirmed. Registry to transmit a copy of this judgment along with trial Court and Fast Track Court records to the concerned Courts without delay. The amount deposited if any by the revision petitioner/accused in this Court be transmitted to the trial Court forthwith.