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Bangalore District Court
Kempajamma R vs Elangavan on 7 May, 2025
KABC030881132019
IN THE COURT OF THE XV ADDL. CHIEF JUDICIAL
MAGISTRATE, AT BANGALORE
Dated this the 07th day of May 2025
PRESENT: Smt. Namrata Rao. K.S
B.A.L, L.L.B., M.B.L.,
XV ACJM,.
BENGALURU.
C.C.No.28537 of 2019
Complainant : Smt. Kempajamma. R
W/o Sathish,
Aged about 45 years,
R/at No.1, I main cross,
Munikrishnappa Layout,
Adugodi,
Bengaluru-560 030.
(By Sri. K.B Manjunatha., Advocate )
V/s
Accused : Sri. Elangavan
Major in age, R/at No.6,
3rd cross, 100 feet Inter Ring Road,
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C.C.No.28537/2019
Viveknagar post,
Sreenivagalu,
Bengaluru-560 047.
And also at:
Shree Nilaya,
Ashwini Enterprises
No.12/2, Main road,
Viveknagar post,
Sreenivagelu Main Road,
Bengaluru-560 047.
(By Sri. HVT Gowda- Advocate )
Cognizance taken on 29.11.2019
Plea recorded on 08.03.2021
Offence alleged U/s 138 NI Act
Evidence commenced on 29.11.2019
Evidence closed on 27.09.2024
Judgment pronounced on 07th day of May 2025
Final order Acquitted
JUDGMENT
This case emanates from the complaint filed
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C.C.No.28537/2019
under section 200 of the CrPC alleging the commission
of offence punishable U/s 138 N.I.Act against the
accused.
2. The case of the complainant in nutshell is as
under:
The accused, his wife and her son were doing chit
business and they asked the complainant to be a
subscriber for the said chit business. On the request, the
complainant became a subscriber for a chit of the sum
of Rs.3,00,000/-. The complainant was regular in
payment of the subscription amount. After the auction
of the chit, the accused issued cheque bearing
No.376760 dated 10.10.2019 for a sum of
Rs.1,00,000/- drawn on Andhra Bank, Koramangala
Branch, Bengaluru. Upon presentation, the cheque was
dishonoured for the reason “Account Blocked” on
4
C.C.No.28537/201916.10.2019. The legal notice dated 21.10.2019 was
issued to the accused. The accused has replied to the
said legal notice. Without any forego, the complainant
has filed this complaint.
3. On presentation of the complaint, the
cognizance for the offence was taken. Pursuant to the
issuance of the summons, the accused made appearance
before this court and the accused is on bail throughout
the trial.
4. On compliance of Section 207 of Cr.P.C, the
plea was recorded. The accused pleaded not guilty,
claimed defense.
5. The Complainant has examined herself as PW.1
and Ex.P1 to Ex.P7 are marked. The statement of the
accused u/S 313 statement was recorded. The accused
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C.C.No.28537/2019
has denied all the incriminating evidence against him.
The accused has examined as DW.1 and got marked
Ex.D1 to D3 on his side.
6. I have given a careful consideration to the
arguments advanced by the counsel for both sides. I
have carefully perused the records.
7. In view of the materials placed on record,
the following points arise for my consideration:
1. Is there a legally recoverable debt?
2. Whether the complainant proves
that the accused has committed
the offence punishable under
section 138 of N.I.Act?
3. What Order?
8. My findings for the above points are:
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C.C.No.28537/2019
Point No.1 : In the Negative
Point No.2: In the Negative
Point No.3: As per the final order
for the followingREASONS
9. POINT No.1: It is the case of the complainant
that, the wife of the accused and his son were running
a chit business. She was a subscriber to the chit fund of
Rs.3,00,000/-. After the auction of the chit the accused
has given the cheque in repayment of Rs.1,00,000/- to
the complainant.
10. The acquaintance of the complainant and the
accused is not disputed. The accused admits that the
complainant used to come to his house and was a
known person to his wife. As per Sec.138 of the N.I Act,
all those debts or other liabilities can be claim if a
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C.C.No.28537/2019
cheque is issued for the discharge of such debt and
liability either in whole or in part.
11. It is res integra that the debt or liability
which is mentioned U/Sec.138 of the N.I Act concerns
that a legally recoverable debt and liability. The
Honble High Court of Karnataka in R. Parimala Bai vs
Bhaskar Narasimhaiah reported in (2018) 4 KCCR
3464 has held at para 18 as under:
“18. On careful perusal of the above said
decisions, it is crystal clear that in order to attract
Section 138 of the Negotiable Instruments Act, the
ingredients of Section 138 have to be established
primarily by the complainant by pleading in the
complaint with regard to the existence of any legally
recoverable debt or liability on the part of the accused.
Even a semblance of doubt is raised with regard to the
existence or non existence of legally recoverable debt,
then also it should be established during the course of
trial by means of pleading the facts and leading
evidence. It is the defence taken up by the accused that
there was no legally enforceable debt, and further
that, it is not only the defence, but also the court has
to examine whether on complete reading of the
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C.C.No.28537/2019complaint itself whether any offence u/s.138 of the
Negotiable Instruments Act is constituted or not. It is a
very well recognized principle of criminal
jurisprudence that, if on plain and meaningful reading
of the complaint or the FIR, the allegations made in
the complaint or in the FIR do not constitute any
offence or under any penal law for the time being in
force, the continuation of such prosecution amounts to
abuse of process of law. Therefore, the court has to
examine without reference to the defence of the
accused on the basis of the complaint itself whether
there existed ingredients of Section 138 of the
Negotiable Instruments Act. Even in order to take
cognizance and issuance of process against the
accused, such exercise has to be done, to nip the case
at the bud to avoid unnecessarily accused facing the
trial.”
12. Let me analyze from the record that the as to
whether the amount so claimed by the complainant
through the cheque Ex.P1 is a legally recoverable debt
or not.
13. The complainant argues that the wife of the
accused and his son were running a chit business. Every
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C.C.No.28537/2019
chit business is governed by the enacting the Chit Fund
Act 1982 and regulated by the Reserve Bank of India.
Chapter -2 of the Chit Funds Act describes the
requirements for starting a chit business. Sec.4 of the
Act postulates that a previous sanction of the State
Government within whose jurisdiction the chit is to be
commenced is absolutely necessary. That apart the
invitation for subscription is also prohibited unless and
until, circular, proposal etc contains statement about
the previous sanction under Sec.4 of the Act has been
obtained and the said circular, proposal should
mention the particulars of such sanction. Section 8 of
the said Act provides that a company registered under
the Companies Act can not commence the chit business
unless and until the paid up capital is not less Rs.1
Lakh. Sections 6, 7 an 10 provides the format of the
chit agreement, as to how the chit agreement has to be
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C.C.No.28537/2019
filed before the Registrar and also that the copies of the
chit agreement has given to the subscriber.
14. Keeping these aspects in mind, let me go
through the case papers once again. It is not the claim
of the complainant that either the accused or his wife
or their son were involved in the chit business after
complying the provisions of chit fund Act 1982. There
is absolutely no iota of evidence tabled before this court
to show that the chit business was registered as
mandated. That apart though the complainant claims
herself to be a subscriber to the chit running by the
wife of the accused and son, she has not placed the chit
agreement, the subscription amount paid by her. The
complainant who says that she had participated in the
chit and had been paying the chit installment, takes no
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C.C.No.28537/2019
pain to place any documentary proof in this regard.
15. First of all even if it is considered that the
wife of the accused and their son were carrying out the
chit business as alleged by the complainant, it is illegal
for want of registration and penal in nature also. When
the chit business as alleged by the complainant is not
registered and can not be recognized under law, the
alleged transaction of Rs.3 lakh paid by the
complainant to the wife of the accused can not be
placed within the corners of the legally recoverable
debt. From this angle only the complaint is to be
dismissed.
16. Though the accused admits that Ex.P1
cheque belongs to him he denies as to the signature on
it. The presumption therefore cannot be raised. The
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C.C.No.28537/2019
contention of the accused in the legal notice marked at
Ex.P3 as well as in the cross examination is that the
cheques as mentioned by the complainant were lost by
the accused and were stolen by the complainant.
Further one more stand is taken at the time of cross
examination that the accused is slowly loosing his eye
sight and the probability of issuing the cheque after
being signed on it is law. During his defence, the
accused has produced the medical certificate which
reflects that he is suffering from Amblyopia in the right
eye and with CME S/p Qzurdex with the left eye. The
medical certificates issued by the expert is not
questioned by the complainant. That apart the accused
has time and again said in his cross examination that
he has not signed any cheques and he has slowly lost
his eye sight.
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C.C.No.28537/2019
17. That apart, the bank statements produced by
the complainant at Ex.P8 shows that on various dates
the complainant has transferred the amounts to the
account of the wife of the accused. If at all there was
any financial relationship between the complainant and
the wife of the accused, certainly it would be the wife
of the accused who would be liable. As far as the
existence of the legally recoverable debt is concerned,
is not proved so far as the accused is concerned. If at all
it was the case of the complainant that the on the say
of the accused, the amount was deposited into the
account of the accused and therefore the accused has
issued the said cheque then certainly, a case would
have been made out.
18. Keeping aside the defense of the accused for a
moment, even if the claim of the complainant is gone
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C.C.No.28537/2019
through on a thorough reading of the complain itself, it
is clear that the complainant has not proved the
existence of legally recoverable debt .Hence, I answer
the point No.1 in the NEGATIVE.
19. Point No.2: I have discussed the Point
No.1 in detail. I have arrived at the conclusion that the
complainant has not made out the existence of legally
recoverable debt. The offence under section 138 of the
Negotiable Instruments Act is not made out.
Accordingly I answer the POINT NO.2 In The
NEGATIVE.
20. Point No.3: For the foregoing reasons and in
view of the above findings, I pass the following:
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C.C.No.28537/2019
ORDER
The accused is found not guilty.
In Exercise of the Powers vested
under section 255(1) of Cr.P.C., the
accused is Acquitted for the offence
punishable under section 138 of N.I.Act.
The personal bond executed by the
accused shall stand cancelled and the
cash security deposited by the accused
shall be refunded to the accused after
the appeal period is over.
(Dictated to stenographer, transcribed by her, the transcript corrected by
me and then pronounced in the open court on this the 07 th day of May,
2025)
Digitally signed
KS by K S
NAMRATHA NAMRATHA RAO
RAO Date: 2025.05.07
17:42:01 +0530(Smt. Namrata Rao K.S)
XV ACJM, Bengaluru.
ANNEXURE
LIST OF WITNESSES EXAMINED FOR THE
COMPLAINANT:
PW.1 : Smt. Kempajamma. R
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C.C.No.28537/2019
LIST OF DOCUMENTS MARKED FOR THE
COMPLAINANT:
Ex.P1 : Cheque
Ex.P1(a) : Signature of the accused
Ex.P2 : Bank Endorsement
Ex.P3 : Office copy of legal notice
Ex.P4 : 2 Postal receipts
Ex.P5 & 6 : 2 postal acknowledgments
Ex.P7 : Reply notice
Ex.P8 & 9 : 2 HDFC Bank
Statements
LIST OF WITNESSES EXAMINED FOR THE
ACCUSED:-
DW.1 : Elangavan
LIST OF DOCUMENTS MARKED FOR THE
ACCUSED:-
Ex.D1 : Out patient slip
Ex.D2 : Scanning report
Ex.D3 : Devi hospital letter
(Smt. Namrata Rao K.S)
XV ACJM, Bengaluru.
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C.C.No.28537/2019
07.05.2025
(Judgment pronounced in the open court)
ORDER
The accused is found not guilty.
In Exercise of the Powers vested
under section 255(1) of Cr.P.C., the
accused is acquitted for the offence
punishable under section 138 of N.I.Act.
The personal bond executed by the
accused shall stand cancelled and the cash
security deposited by the accused shall be
refunded to the accused after the appeal
period is over.
A copy of the above judgment shall be
supplied to the accused free of cost.
(Vide separate judgment)
XV ACJM, Bengaluru.
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C.C.No.28537/2019
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