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Bangalore District Court
M/S Shree Simhadri Steel And Cements vs J K Cement Ltd on 13 June, 2025
1 Crl.Apl.No.578/2023 JUDGMENT
KABC010119492023
IN THE COURT OF LXIX ADDITIONAL CITY CIVIL
AND SESSIONS JUDGE (CCH 70)
Present:
Smt. Shirin Javeed Ansari, B.A.,LL.B (Hon`s) LL.M.,
LXIX Additional City Civil and
Sessions Judge, Bengaluru.
Dated this the 13th day of June, 2025
Crl.A.No.578/2023
APPELLANTS: 1. M/s. Shree Simhadri Steel and
Cements
No.3, Opp. Panchayath Office,
3rd Cross Road,
Adakimaranahalli,
Makali Post, Dasanapura Hobli,
Bangalore North Taluk,
Bangalore-562162
Rep. by its Proprietor and
Authorized Signatory
Mrs. Roopashree G V
2. Mrs. Roopashree G V,
No. 3, Opp. Panchayath Office,
3rd Cross Road,
Adakimaranahalli,
Makali Post,
Dasanapura Hobli,
Bangalore North Taluk,
Bangalore - 562162,
Karnataka,
2 Crl.Apl.No.578/2023 JUDGMENT
And also at
No. 47/1, Shivaram Karanth Road,
2nd Cross, Adakimaranahalli,
Makali Post,
Dasanapura Hobli,
Bangalore North Taluk
Bangalore - 562162.
(Sri M.G.Nagesh Babu, Advocate for
appellants)
-V/s-
Respondent: M/s. J.K.Cement Ltd
Having regional Marketing Officers
at No.541, 3rd Floor
4th Cross, HMT Layout,
R.T.Nagar
Bangalore-560 032
rep: by its Authorised Officer
Mr.Sanjay Naik
s/o Dattu
Aged about 45 years
(Sri Chethan Kumar.K., Advocate for
respondent)
JUDGMENT
This criminal appeal under Section 374(3) of the Code
of Criminal Procedure, 1973 is directed against the
judgment of conviction and order of sentence passed in
C.C. No. 3669/2021 by the Learned XXVII Additional Chief
3 Crl.Apl.No.578/2023 JUDGMENT
Metropolitan Magistrate, Bengaluru, whereby the appellant
was convicted for the offence punishable under Section
138 of the Negotiable Instruments Act, 1881, and
sentenced accordingly.
2. The accused in C.C. No. 3669/2021
before the trial court having preferred the instant
appeal against the complainant. T he appellant and
respondent are hereby assigned with their original
ranks before the trial court i.e., the appellant as
accused and respondent as complainant in C.C.
No. 3669/2021 in the instant discussion for the
purpose of brevity and convenience to avoid the
confusion and perplexity.
3. The epitomized facts of the case in C.C.
No. 3669/2021 before the trial court as unfolded
before the learned Trial Court, is that the complainant
company is engaged in the business of manufacture and
sale of cement and allied construction materials. It is
alleged that the accused, being the proprietor of a firm,
was a stockist or dealer of the complainant’s products and
4 Crl.Apl.No.578/2023 JUDGMENT
used to purchase Grey Cement on credit. A running
account was maintained, and an outstanding sum of Rs.
3,76,444/- was allegedly due. Towards this, the accused is
said to have issued Cheque No. 074764 dated 05.12.2019
drawn on Tamilnad Mercantile Bank, which, upon
presentation, was dishonoured with the endorsement
“Funds Insufficient”.
4. A statutory demand notice dated 16.12.2019
was issued and, allegedly served. As there was no response
or payment, the complainant instituted a private complaint
under Section 200 of Cr.P.C., invoking Section 138 of the
NI Act.
5. Upon service of summons, the accused entered
appearance, pleaded not guilty, and contested the case.
The complainant examined its authorised signatory as PW1
and marked 26 exhibits. The accused examined herself as
DW1 and did not produce documentary evidence.
6. The learned Trial Court, upon appreciation of
materials, convicted the accused and sentenced her to pay
Rs. 4,10,000/-, out of which Rs. 4,00,000/- was directed
5 Crl.Apl.No.578/2023 JUDGMENT
as compensation to the complainant and the remainder
remitted to the State. The present appeal assails the said
conviction.
7. Being aggrieved by the impugned judgment
passed by the trial court, the appellant being accused
before the trial court has preferred the instant appeal
against the respondent who was the complainant before
the trial court on the following:
GROUNDS OF APPLEAL
a) The Appellant/accused submits that, the
private complaint was filed by the respondent
before the court below are all false. The tria
court had not given opportunity to the
appellant to prove his case.
b) The Appellant/accused submits that,
The Hon’ble court below be pleased to taken
the cognizance against the appellant. The
appellant appeared before the court below
plea was recorded, the appellant not guilty
and prays for evidence and claims for trail
and then case posted for
complainant/respondent evidence.
c) The Appellant/accused submits that, the
applicant has partially examined. And the
6 Crl.Apl.No.578/2023 JUDGMENTappellant wants to establish his defence in
the court below. The Hon’ble lower court not
proper given opportunity to the appellant.
d) The Appellant/accused submits that, the
above said Judgment and order of Conviction
and sentence passed by the Learned XXVII
ACMM, Bangalore in C.C. No. 3669/2021
D.D. 05-04-2023 is totally perverse, illegal,
unlawful and bad in law and hence the same
is liable to be set aside by this Hon’ble court.
e) The appellant/ accused submits that, he
has issued the disputed cheque for security
purpose, the disputed cheque was used by
the complainant/respondent for their
wrongful gain, the trial court has not given
sufficient opportunity to the appellant to
prove his case.
f) The appellant/accused submits that, the
Hon’ble Court below after conclusion of trial
has proceeded and passed judgement against
the appellant, that In exercise of power
conferred under section 255(2) of Cr.P.C. the
accused is convicted for the offence
punishable under section 138 of N.I. Act and
sentenced to pay fine of Rs. 4,10,000/-. In
default of payment of the said fine amount,
the accused shall undergo simple
7 Crl.Apl.No.578/2023 JUDGMENTimprisonment for a period of Three months.
Out of the said fine amount, an amount of
Rs. 4,00,000/- shall be paid to the
complainant as compensation as
contemplated under section 357(1) of Cr.P.C.
and remaining amount of Rs. 10,000/-shall
be remitted to the state, the above said
judgment of the trial court is totally contrary
to facts, materials and evidence placed on
records and as such the judgment, conviction
and sentence is liable to be set-aside by this
Hon’ble court.
g) The impugned Judgment and conviction
and sentence passed by the Trial court is
contrary to facts, materials and evidence
placed on records and as such the judgment,
conviction and sentence is liable to be set-
aside by this Hon’ble court.
h) The appellant/accused submits that, the
disputed cheque is issued by the accused to
the complainant, when she getting dealership
i.e., in the year 2018 for the purpose of
security. After that on the same day cheques
issued by the accused are honoured and en-
cashed to the complainant, but the trial court
is not narrate this fact anywhere in the
judgment.
8 Crl.Apl.No.578/2023 JUDGMENT
i) The appellant/accused submits that,
without perusing of Cross examination of
PW-1, without perusing written arguments of
the accused the trial court has blindly passed
one side judgment.
j) The appellant/accused submits that, the
accused dealership business immediately
stopped due to the Covid-19 pandemic, in the
meanwhile the complainant company
intentionally to grab more money from the
accused, misused her blank signed cheque
and filed the false case against the innocent
accused.
k) The appellant/accused submits that, the trial court is not discussed about 15
honoured cheques, the court considered and
discussed about only the disputed cheque.
l) The trial court erred in placing much
reliance upon the chief examination of PW1
when their evidence is totally unbelievable,
unacceptable and throws great doubt upon
their credibility and reasonability, though the
evidence of DW-1 have partially taken, but
the trial court has not given sufficient
opportunity to the appellant to prove his
case.
m) The appellant/ accused submits that,
9 Crl.Apl.No.578/2023 JUDGMENT
the respondent/ complainant had not
examined any independent witness to
corroborate the claim of the complainant/
respondent, which material facts not at all
considered by the trial court while passing
the above said impugned judgment and order
is liable to the set aside.
n) The trial court has committed a grave
error in not exercising his judicial mind in
appreciating the defence documents of the
accused/ appellant.
o) The appellant submits that, the
appellant has not filed any other appeal
before any other court for the same relief.
p) The appellant craves the permission of
this Hon’ble court to urge additional grounds.
Hence, the Appellant prays before this Court to call
for the entire records and Set-aside the order of conviction
and sentence and fine imposed by the trial court in C.C.
No. 3669/2021 D.D. 05-04-2023 and be pleased to acquit
the Appellant/Accused in the above said case, in the
interest of justice.
8. Learned Counsel for the appellant have filed
written arguments. Learned Counsel for the respondent
10 Crl.Apl.No.578/2023 JUDGMENT
neither argued the matter nor submitted their written
arguments. This court has perused the materials available
on record.
9. On the basis of the materials available on
record following points arise for my consideration:
1) Whether the judgment of conviction passed
by the learned Trial Court is legally
sustainable in light of the evidentiary
material on record?
2) Whether the accused-appellant was denied
fair opportunity to substantiate her
defence, thereby occasioning miscarriage of
justice?
3) Whether the appellant has successfully
rebutted the presumption under Section
139 of the NI Act on a preponderance of
probabilities?
4) What order?
10. My findings to the above points are as under:
Point No.1 to 3: In the Affirmative
Point No. 4 : As per final order for
the following,
11 Crl.Apl.No.578/2023 JUDGMENTREASONS
11. Point No. 1 to 3:- The genesis of the
prosecution’s case, as it unfolded before the Learned Trial
Court, emanates from a commercial relationship said to
have existed between the complainant company and the
accused. The complainant, a company engaged in the
business of manufacturing, marketing, and supplying Grey
Cement, White Cement, industrial adhesives, and other
allied construction materials, is stated to have had a
continuing business transaction with the accused, who
was allegedly functioning as a dealer or stockist under her
proprietary concern.
12. It is the complainant’s specific averment that,
pursuant to the recurring requisitions placed by the
accused for the supply of cement, the complainant
regularly supplied the said material on a credit basis. It is
further contended that the parties maintained a running
ledger account, and upon reconciliation, a sum of Rs.
3,76,444/- was found to be outstanding and payable by
the accused towards unpaid invoices.
12 Crl.Apl.No.578/2023 JUDGMENT
13. In partial discharge of the said alleged liability,
the accused is stated to have drawn and issued a cheque
bearing No. 074764 dated 05.12.2019, drawn on Tamilnad
Mercantile Bank Ltd., Weavers Colony Bus Stop Branch,
B.H. Road, Nelamangala, in favour of the complainant
company. However, when the said instrument was
presented for realisation through the complainant’s banker
–Corporation Bank, CAPS Branch, Bengaluru–the same
was returned unpaid, accompanied by a banker’s
endorsement dated 07.12.2019 stating “Funds
Insufficient”.
14. In compliance with the statutory mandate
under Section 138(b) of the Negotiable Instruments Act,
1881, the complainant caused to be issued a legal demand
notice dated 16.12.2019 to the accused through Registered
Post with Acknowledgement Due (RPAD), calling upon her
to honour the cheque amount within the prescribed period
of fifteen days. It is claimed that the notice was duly
served, yet the accused neither tendered the amount nor
furnished any reply, thereby compelling the complainant to
13 Crl.Apl.No.578/2023 JUDGMENT
initiate criminal proceedings.
15. Thereafter, a private complaint was lodged
under Section 200 of the Code of Criminal Procedure,
seeking prosecution of the accused for the offence
punishable under Section 138 of the Negotiable
Instruments Act.
16. The memorandum of appeal challenges the
impugned judgment primarily on the grounds that the
cheque in question was issued by way of security at the
inception of the dealership arrangement and not towards
any legally enforceable liability. The trial court failed to
consider the economic hardships faced due to the
pandemic and closure of the dealership business. There
was no fair opportunity provided to lead full and
meaningful defence, including summoning key witness
Nandakumar. The trial court ignored material
contradictions and relied solely upon the oral deposition of
PW1 without proper corroboration. No agreement or proof
of running account was produced by the complainant.
Previous cheques were honoured and no continuity of
14 Crl.Apl.No.578/2023 JUDGMENT
liability was established. The statutory notice was not duly
served on the accused, rendering the proceedings invalid.
17. This judgment proceeds upon the foundational
premise that the Trial Court has failed to address and
adjudicate upon four cardinal issues, each of which
constitutes a vital fulcrum in the proper appreciation of the
factual and legal matrix of the case and they are:
A) denial of meaningful opportunity:
breach of procedural fairness in defence.
B) The character of the cheque:
Security measure or discharge of legal debt?
C) Presumption and probabilities:
Assessing the defence U/sec 139 of NI Act.
D) Statutory demand notice:
presumption of its service and its evidentiary
fragility.
18. It is observed that the impugned judgment
suffers from a conspicuous absence of judicious evaluation
of the defence theory, a neglect to examine material
evidence both oral and documentary, and a lack of due
consideration of the circumstances under which the
cheque in question was allegedly issued. Furthermore, the
trail court has, with due respect, omitted to frame and
address points of determination that were essential for a
15 Crl.Apl.No.578/2023 JUDGMENT
holistic and lawful adjudication of the complaint. The
failure to apply judicial mind to these aspects has resulted
in the rendering of a decision that is not only perfunctory
but also bereft of legal sufficiency, thereby occasioning a
grave miscarriage of justice. Consequently, the judgment
under appeal stands vitiated and cannot be sustained in
the eyes of law for the reasons stated below:
19. Denial of meaningful opportunity: breach of
procedural fairness in defence. It is a cardinal principle of
criminal jurisprudence that a fair trial is the heart and soul
of justice delivery. In the instant case, although the
appellant entered the witness box as DW1, the refusal or
failure to summon Nandakumar, the official who allegedly
procured her signature on Ex.P1 under questionable
circumstances, stands out as a grave omission. The trial
court did not consider this omission fatal, but in the
opinion of this Court, denial of opportunity to cross-
examine or summon a key official, whose role is pivotal in
the alleged admission of liability, offends principles of
natural justice.
16 Crl.Apl.No.578/2023 JUDGMENT
20. As laid down by the Hon’ble Supreme Court in
Krishna Janardhan Bhat v. Dattatraya G. Hegde (2008) 4
SCC 54, mere invocation of statutory presumptions cannot
absolve the court of its duty to ensure that defence
evidence is not truncated or foreclosed. The failure to
appreciate this nuance is fatal to the finding of guilt.
21. The character of the cheque: Security measure
or discharge of legal debt? The principal defence of the
appellant has been that the cheque in question was issued
as a blank security cheque at the time of granting
dealership in 2018. This assertion gains credibility when
one considers the consistent and categorical deposition of
DW1, which has remained unshaken in cross-examination.
22. It is well settled that a cheque given by way of
security does not attract penal consequences under
Section 138 unless it is established that the same was
subsequently filled in and presented in connection with an
actual subsisting debt or liability. [Ref: M.S. Narayana
Menon v. State of Kerala, (2006) 6 SCC 39]
17 Crl.Apl.No.578/2023 JUDGMENT
23. The complainant did not produce the dealership
agreement, any written acknowledgment of the running
account, or even independent transporters or third-party
confirmations to prove delivery and receipt of cement.
Ex.P2 ledger and Ex.P1 balance confirmation, alleged to be
proof of liability, are under a cloud, as DW1 has alleged
that the signature was obtained on a blank format.
24. In the absence of independent corroboration
and considering the economic backdrop of COVID-19
business disruption, this Court finds that the cheque,
though signed by the appellant, was not issued in
discharge of a legally enforceable debt.
25. Presumption and probabilities: Assessing the
defence U/sec 139 of NI Act. The trial court has relied on
Rangappa v. Sri Mohan, (2010) 11 SCC 441 to uphold the
presumption under Section 139. However, the decision in
Basalingappa v. Mudibasappa, (2019) 5 SCC 418, clarifies
that a probable defence, not necessarily proved beyond
reasonable doubt, is sufficient to rebut the presumption.
26. The appellant has not only deposed consistently
18 Crl.Apl.No.578/2023 JUDGMENT
about the security nature of the cheque but has also
brought forth the fact that no reply was sent to demand
commission or refund of security deposit, supporting her
version. Moreover, there is no explanation from the
complainant regarding failure to respond to such
assertions either through cross-examination or through
rebutting witnesses. This Court is thus satisfied that the
presumption under Section 139 stands effectively rebutted.
27. Statutory demand notice: presumption of its
service and its evidentiary fragility. The trial court invoked
Section 27 of the General Clauses Act to presume valid
service. However, postal acknowledgments in Ex.P6 to P8
bear no identifiable signature of the appellant. Though
deemed service is a legal presumption, once specifically
denied, the burden shifts on the complainant to prove
actual receipt. [Ref: C.C. Alavi Haji v. Palapetty
Muhammed, (2007) 6 SCC 555]
28. In this context, the appellant’s denial of receipt
assumes significance and, when coupled with absence of
postal delivery official as witness or clarity of signature,
19 Crl.Apl.No.578/2023 JUDGMENT
makes the case of the complainant legally deficient. The
trial court has, with due respect, failed to judiciously
appraise the totality of the circumstances and the evidence
on record.
29. The reasoning adopted borders on presumptive
logic rather than reasoned analysis, and the conviction, in
the absence of concrete evidence on liability, cannot be
sustained. The appellant has demonstrated preponderance
of probabilities in support of her defence. The complainant
has failed to prove existence of enforceable debt, and
therefore, the conviction under Section 138 of the
Negotiable Instruments Act is not legally tenable.
Accordingly, I answer point No.1 to 3 in the Affirmative.
30. POINT NO. 4:- In view of the reasons assigned
to and findings arrived at on point No.1 to 3, I proceed to
pass the following:
ORDER
The criminal appeal filed by the appellant
filed U/sec 374 (3) of Cr.P.C is hereby allowed.
The judgment of conviction and order of
sentence passed by the XXVII Additional Chief
20 Crl.Apl.No.578/2023 JUDGMENTMetropolitan Magistrate, Bengaluru in C.C. No.
3669/2021 dated 05.04.2023 is hereby set-
aside.
The appellant-accused is acquitted of the
offence punishable under Section 138 of the
Negotiable Instruments Act, 1881.
The bail bond, if any, stands cancelled. If
the fine amount is deposited, the same shall be
refunded to the appellant forthwith.
Send back the Trial Court records along
with a copy of this judgment.
(Dictated to the Stenographer Grade-1 directly on the
computer, corrected, signed and then pronounced by me in open
court on this the 13th day of June, 2025)(Shirin Javeed Ansari)
LXIX Addl.C.C. & Sessions Judge,
Bengaluru.
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