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Karnataka High Court · body

2022 DIGILAW 753 (KAR)

Mdn Enterprises v. Lokesh E

2022-06-16

H.B.PRABHAKARA SASTRY

body2022
common order 1. The present petitioner which is a proprietorship concern represented by its proprietor Mr.Doulat Basha, was the accused in C.C.No.1049/2011 and C.C.No.1051/2011, both in the court of the III Additional Civil Judge and JMFC at Chikmagalur (henceforth for brevity referred to as the 'Trial Court') for the offence punishable under Section 138 of the Negotiable Instruments Act (henceforth for brevity referred to as the 'N.I.Act'). 2. The summary of the case of the complainant in C.C.No.1051/2011 from which the Criminal Revision Petition No.219/2018 has arisen was that the accused was a person known to him, availed a loan of Rs. 2,50,000/- from the complainant for the purpose of his business improvement and towards repayment of the said loan amount, the accused issued a cheque bearing No.251909 dated 18.10.2010 drawn on State Bank of India, Chikkamagalur branch, for a sum of Rs. 2,50,000/- in favour of the complainant therein. However, when the said cheque was presented for its realization, the same returned unpaid with the bankers memo 'Account Closed'. In spite of service of notice upon the accused demanding payment of the cheque amount, since the accused did not meet the demand, the complainant was constrained to institute criminal case against him in the Trial Court in C.C.No.1051/2011 for the offence punishable under Section 138 of N.I.Act. 3. The summary of the case of the complainant in the Trial Court in C.C.No.No.1049/2011 was that the accused who was a person known to him for the purpose of his business improvement had availed a loan of Rs. 2,00,000/- from him and towards the repayment of the said amount, he issued a cheque bearing No.251914 dated 29.11.2010 for a sum of Rs. 2,00,000/-drawn on State Bank of India, Chikkamagalur branch. The said cheque when presented for its realization by the complainant, was returned unpaid with the bankers endorsement 'Account Closed'. In spite of the complainant giving a notice to the accused demanding the repayment of the cheque amount, since the accused failed to meet the said demand, the complainant was constrained to institute criminal case against him in the Trial Court in C.C.No.No.1049/2011 for the offence punishable under Section 138 of the N.I.Act. 4. Both the matters were contested by the accused in the Trial Court. In both the cases, the complainants got themselves examined as PW.1 respectively. 4. Both the matters were contested by the accused in the Trial Court. In both the cases, the complainants got themselves examined as PW.1 respectively. In C.C.No.1051/2011 on behalf of the complainant, the documents were marked from exhibits P-1 to P-7. In C.C.No.1049/2011, from the complainant side, documents from exhibits P-1 to P-6 were marked. In both the criminal cases, the accused neither examined any witness nor produced any documents as exhibits from his side. 5. The respondents in both these petitions were the complainants in each of the criminal cases respectively. Both the criminal cases which were tried separately, ended in conviction by the judgment of the Trial Court, both dated 29.12.2016. 6. Aggrieved by the same, the accused preferred Criminal Appeal No.19/2017 against the judgment in C.C.No.1049/2011 and Criminal Appeal No.20/2017 against the judgment in C.C.No.1051/2011, both in the court of II Additional Sessions Judge at Chikkamagalur (henceforth for brevity referred to as 'Session Judge's Court'). Both the appeals were dismissed on merit by separate judgments of the Session Judge's Court, both dated 24.11.2017. Aggrieved by the same, the accused in the Trial Court has preferred these two Revision Petitions. 7. The respondents are being represented by their counsel, the Trial Court and Session Judge's court records were called for and the same are placed before this court. 8. At the request of the petitioner, both these petitions were clubbed together and taken up for disposal together. 9. Though both the matters were listed for admission, however, with the consent from both side, both the matters were taken up for final disposal. 10. Heard the learned counsel from both side. Perused the materials placed before this court including the Trial Court and Session Judge's Court records. 11. The points that arise for my consideration are: (1) Whether judgment of conviction and order of sentence impugned in Criminal Revision Petition No.219/2018 is perverse, illegal or erroneous, warranting interference at the hands of this court? (2) Whether judgment of conviction and order of sentence impugned in Criminal Revision Petition No.220/2018 is perverse, illegal or erroneous, warranting interference at the hands of this court? 12. (2) Whether judgment of conviction and order of sentence impugned in Criminal Revision Petition No.220/2018 is perverse, illegal or erroneous, warranting interference at the hands of this court? 12. Learned counsel for the petitioner in his argument in both the matters, submitted that, he would not deny or dispute that the accused was the drawer of the cheques in both the matters and that both those cheques returned unpaid with the bankers shara of closure of the account of the drawer. However, he contended that in Criminal Revision Petition No.219/2018, there was no loan transaction between the parties. The notice alleged to have been sent by the complainant was not served upon the accused because there is variation in the signature on the postal acknowledgement. He submitted that the subject matter cheque in the Criminal Revision Petition No.219/2018 was issued to Sri.D.T.Patel who is the complainant in Criminal Revision Petition No.220/2018 along with two more cheques as a security but not towards repayment of any loan. However, the said Sri.D.T.Patel misused those cheques by presenting one cheque through his account and getting another cheque presented through his friend Sri.E.Lokesh which ultimately have resulted in both the complainants filing case against the accused for the offence punishable under Section 138 of N.I.Act. He also contended that the complainant in Criminal Revision Petition No.219/2018 had no financial capacity to lend loan. 13. With respect to the Criminal Revision Petition No.220/2018, learned counsel for the petitioner submitted that the cheque in question was issued to the complainant therein as security but not towards repayment of any loan, further no notice was served upon the complainant therein. He submitted that without considering the above aspect, both the Trial Court and Session Judge's Court have convicted the accused for the alleged offence which is perverse. 14. Learned counsel for the respondent in her argument submitted that in both the cases, notices were sent to the correct address of the accused. The address shown in the notice in both the complaints have not been denied by the accused. She also submitted that the inaction on the part of the accused to take any steps in accordance with law to recover his alleged cheque given to the complainants as security itself shows that the accused had issued cheques towards legally enforceable debts only. She also submitted that the inaction on the part of the accused to take any steps in accordance with law to recover his alleged cheque given to the complainants as security itself shows that the accused had issued cheques towards legally enforceable debts only. With this, she submitted that the impugned judgments do not warrant any interference at the hands of this court. 15. In both the criminal cases, the complainants who got themselves examined as PW.1 in their examination-in-chief in the form of affidavit evidence, have reiterated the contentions taken up by them in their respective complaints. In support of their contention, both the complainants have produced the alleged dishonored cheques said to have been given to them by the accused, the bankers endorsement for returning those cheques, copy of the legal notice said to have been sent to the accused, Certificate of Posting, the postal receipt and the postal acknowledgement as exhibits. It is not in dispute that both the cheques at exhibit P-1 in both the cases are drawn by the accused, the names of the payees in both the cheques are shown that of the respective complainants. Both the cheques have been returned by the drawee bank for the reason of closure of the account of the drawer as can be seen in the bankers endorsement. After the return of the cheque by the banker, complainants have contended that they have sent legal notices to the accused demanding the repayment of the cheque amount. However, the accused contends that the said notice has not been served upon him since signatures found on the acknowledgement varies to that of the drawer in exhibit P-1. No doubt, from a naked eye comparison, the signature of the recipient in the postal acknowledgement card appears to be different than the signature of the drawer of the cheque at exhibit P-1. However, it cannot be ignored of the fact that it is not the contention of the accused that the notices were sent to a wrong address. Thus, the notices which were sent under Registered Post Acknowledgement Due to the correct addresses of the accused have been delivered in the place of the addressee. However, it cannot be ignored of the fact that it is not the contention of the accused that the notices were sent to a wrong address. Thus, the notices which were sent under Registered Post Acknowledgement Due to the correct addresses of the accused have been delivered in the place of the addressee. Merely because the signature on the acknowledgement card appears to be at variance compared to the one in the cheques at exhibit P-1, by that itself, it cannot be held that there was no issuance of notice by the complainant to the accused. Further, there was no suggestion made to PW.1s' in their cross-examination from the accused side. Moreover, in both the cases, the complainants apart from sending the notices through Registered Post Acknowledgement Due, have also sent the notice through Certificate of Posting which certificate they have produced and marked as exhibits. According to the complainants, those notices sent through Certificate of Posting have been duly served upon the accused which aspect has not been specifically denied in the cross-examination of PW.1. Thus, when notices in both cases have been sent by the complainant under more than one mode to the accused to the correct address by duly paying necessary postage and also when the complainants have produced postal acknowledgement card and Certificate of Posting along with Registered Post receipt, it cannot be held that those notices were not served upon the accused. Hence, the argument of the learned counsel for the petitioner on this point is not acceptable. Admittedly, the accused has not repaid the alleged loan amount to the complainant even after the issuance of notice to him. Thus, the presumption about existence of legally enforceable debt form in favour of the complainant in both the cases. However, the said presumption is rebutable. 16. In order to rebut the presumption, the complainant has taken a defence of general denial of the loan transaction in C.C.No.1051/2011 and a common defence that the cheques in question were given to the complainant Sri.D.T.Patel, his brother by name Sri.Shanthi Bhai and the accused together as a security. However, those cheques have been misused by them. Naturally, the complainants in both the cases have denied the suggestions made to that effect from the accused side, in their cross-examinations. 17. However, those cheques have been misused by them. Naturally, the complainants in both the cases have denied the suggestions made to that effect from the accused side, in their cross-examinations. 17. In the cross-examination of complainant Sri.D.T.Patel in C.C.No.No.1049/2011, it was elicited that apart from timber business and running a saw mill, they also does the transaction of giving money and recovering it back and that from few people, while lending the money, they would collect stamp paper and cheques. From the suppliers of the timber to their saw mill also, they collected stamp paper and cheques while advancing them the money before supply of the timber. However, for a regular supplier of the timber, they do not collect such stamp paper and cheques. The said PW.1 further stated that from the accused, they had not collected any stamp paper or cheques while advancing him a sum of Rs. 2,00,000/-, however, the said loan was given only on the trust and personal belief. Though Sri.D.T.Patel as PW.1 in his cross-examination admitted that the complainant in the other case by name Sri.E.Lokesh is a person known to him who stated that he is not his friend. He also stated that he does not know about the alleged financial transaction between the said Sri.E.Lokesh and the accused. The witness categorically denied a suggestion that the cheques in question were issued to him by the accused as a security for an advance of Rs. 50,000/- made by him to the accused for the supply of timber. However, he retained those cheques without returning them even after deducting the said amount of Rs. 50,000/- in instalments in the bills payable to the accused. In this manner, the defence of the accused was only in the form of oral suggestions made to the complainant Sri.D.T.Patel. In his cross-examination, however, the said witness has not admitted those suggestion as true. Except making the oral suggestion, the accused has not taken any steps to place any other material in support of his contention nor he entered witness box to lead his evidence. 18. Even in the cross-examination of the complainant Sri.E.Lokesh in C.C.No.1051/2011 also, it was elicited from the witness that he was known to Sri.D.T.Patel who is the complainant in the other case. It was elicited in the cross-examination that apart from Sri.D.T.Patel and Sri.E.Lokesh knowing to each other, the said Sri.E.Lokesh also knew the accused. 18. Even in the cross-examination of the complainant Sri.E.Lokesh in C.C.No.1051/2011 also, it was elicited from the witness that he was known to Sri.D.T.Patel who is the complainant in the other case. It was elicited in the cross-examination that apart from Sri.D.T.Patel and Sri.E.Lokesh knowing to each other, the said Sri.E.Lokesh also knew the accused. Even the said Sri.E.Lokesh also as PW.1 in his cross-examination admitted that there was financial transaction between the said Sri.D.T.Patel and the accused. However, he stated that he does not know that on those occasions, the accused was giving blank cheque and stamp paper to Sri.D.T.Patel. Since the said Sri.E.Lokesh as PW.1 in C.C.No.1051/2011 in his cross-examination agreed that he received the cheque in question at Shivashakthi Saw Mill, the learned counsel for the petitioner submitted that since the said saw mill belongs to Sri.D.T.Patel, the cheque has been received by Sri.E.Lokesh from Sri.D.T.Patel. The said argument of learned counsel for the petitioner is only an assumption because nowhere Sri.E.Lokesh has stated in his evidence that he received the said cheque from Sri.D.T.Patel. Merely because he says that the said cheque was given to him in the said mill, it cannot be inferred that the said cheque was given to him by Sri.D.T.Patel. On the other hand, the reading of the entire evidence of the said Sri.E.Lokesh, makes it clear that he was going to Shivashakthi Saw Mill of Sri.D.T.Patel frequently and spend sometime there, as such, he knows both Sri.D.T.Patel and his elder brother Sri.Shanthi Bhai as well as the accused. The accused was visiting the said saw mill for supply of timber. Therefore, if the complainant Sri.E.Lokesh received the cheque from the accused in Shivashakthi Saw Mill, it cannot be inferred that the said cheque was given to him by Sri.D.T.Patel. It is also to be noticed that even though the learned counsel for the petitioner in his argument repeatedly submitted that the cheques in question were given to Sri.D.T.Patel as a security by the accused when the said Sri.D.T.Patel had advanced a sum of Rs. 50,000/- and the said Sri.D.T.Patel misused those cheques and got one cheque presented through Sri.E.Lokesh, but, suggestions made to said Sri.D.T.Patel and Sri.E.Lokesh in their cross-examination from the accused side, gives a different picture. 50,000/- and the said Sri.D.T.Patel misused those cheques and got one cheque presented through Sri.E.Lokesh, but, suggestions made to said Sri.D.T.Patel and Sri.E.Lokesh in their cross-examination from the accused side, gives a different picture. In the cross-examination of both these witnesses, it was suggested to the witness that the cheques in question were collected by not just Sri.D.T.Patel but by all the three i.e., Sri.D.T.Patel, his brother Sri.Shanthi Bhai and Sri.E.Lokesh. There is no explanation available anywhere as to why should the accused give blank cheques to all the three persons i.e., both the complainants herein and one Sri.Shanthi Bhai when even according to accused, the alleged transaction of a sum of Rs. 50,000/- was only between himself and said Sri.D.T.Patel. Therefore, the defence of the accused creates a doubt in the mind of the court. Secondly, in the cross-examination of Sri.D.T.Patel, a suggestion was made from the accused side that the said complainant had deducted the said sum of Rs. 50,000/- between the years 2007 to 2010. However, the witness has not admitted the said suggestion as true. Had really the said Sri.D.T.Patel deducted the alleged sum of Rs. 50,000/- between the years 2007 to 2010, the accused ought to have maintained some records in that regard, at least the details about the date, time and the amount deducted, etc. Thus, without placing any such details or materials, merely making a suggestion to a witness that the said amount was deducted and that too when the said suggestion was not admitted by the witness as true, does not inspire confidence in the court to believe that the said defence taken by the accused is more nearer to the truth or more probable. Lastly, if according to accused, the alleged amount of Rs. 50,000/- had already been collected back by the said Sri.D.T.Patel in a span of three years from the years 2007 to 2010, nothing had prevented the accused from taking appropriate action in recovering his alleged cheques from the alleged possession of Sri.D.T.Patel, his brother or Sri.E.Lokesh. There is nothing on record to show that any such attempt was made by the accused. Admittedly, neither any notice was sent to the complainants nor any complaint was lodged against them of wrongfully withholding the cheques nor even stop payment order was given by the accused to his banker. There is nothing on record to show that any such attempt was made by the accused. Admittedly, neither any notice was sent to the complainants nor any complaint was lodged against them of wrongfully withholding the cheques nor even stop payment order was given by the accused to his banker. Thus, mere his self-serving oral statement that there was no due by him to the complainants, is not sufficient to rebut the presumption which has been formed in favour of the complainants. These matters clearly go to show that the accused could not able to rebut the presumption about the existence of legally enforceable debt formed in favour of the complainants in both the cases under Section 139 of N.I.Act. Thus, both the Trial Court as well as the First Appellate Court since after proper appreciation of evidence placed before them, have rightly come to a conclusion holding the accused guilty of the alleged offence in both the matters and have sentenced him proportionate to the proven guilt, I do not find any reason to interfere in the impugned judgments in both the matters. Accordingly, I proceed to pass the following: order The Criminal Revision Petition No.219/2018 and Criminal Revision Petition No.220/2018 are dismissed as devoid of merits. Registry to transmit a copy of this order to both the Trial Court and also the Sessions Judge's Court along with their respective records immediately.