Bangalore District Court
N.M.Garments vs Ashok .R on 14 July, 2025
KABC020399712023
IN THE COURT OF THE VIII ADDL. JUDGE, COURT OF
SMALL CAUSES AND ACJM, BENGALURU CITY.
(SCCH-5)
DATED THIS THE 14TH DAY OF JULY, 2025
PRESENT: SMT. SHARMILA KAMATH K.
B.A. LLM.,
VIII ADDL. JUDGE, COURT OF SMALL
CAUSES AND ACJM,
BENGALURU.
C.C No.13778/2023
COMPLAINANT : N.M. Garments
Having office at No.7,
S.S.Residency,
Manjunatha Layout,
Satsang Ashram Road,
Near RTO Office,
Medahalli, Virgonagar Post,
K.R.Puram,
Bengaluru - 560 049.
Represented by its Proprietor
Sri. Ananda Gowda K.N.
S/o. K.M. Nagappa
Aged about 31 years
(By Sri.T.N,.Rajashekar, Adv.,)
V/s
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SCCH-5
ACCUSED : Sri. Ashok R.
S/o. Ramanjinappa
Aged about 31 years
No.1346, 5th Main Road,
Gandhi Nagar,
Yelahanka,
Bengaluru - 560 064.
(By Sri.Jagadeesha H., Adv.,)
*****
::JUDGMENT:
:
The complainant filed complaint Under Section 200
of Code of Criminal Procedure 1973 for the offence
punishable Under section 138 of Negotiable instrument
Act.
2. The factual matrix of complaint is as
under :-
The complainant is doing business of manufacturing
and selling of clothes in domestic and international
market in the name and style as “N.M.Garments”. The
accused used to place orders for purchase of clothes with
the complainant. The accused towards partial discharge
3 CC No.13778/2023
SCCH-5of outstanding debt issued the cheque bearing No.538485
drawn on State Bank of India, Mathura Arcade, Nehru
Nagar, Bellari Road, Yelahanka, Bengaluru dated
01.07.2023 for Rs.1,37,920/-. The complainant presented
the said cheque for encashment but the said cheque
returned with an endorsement dated 03.07.2023 as
“FUNDS INSUFFICIENT”. On 24.07.2023 the complainant
issued legal notice through RPAD calling upon the
accused to repay the cheque amount. Inspite of service of
notice the accused failed to make payment of cheque
amount. Hence the complaint.
3. After taking cognizance for the offence Under
Section 138 of N.I.Act, sworn statement of the
complainant was recorded. Considering the facts that
there were sufficient materials to proceed against the
accused the process was issued. After issuance of the
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summons the accused appeared before the court and
enlarged on Bail.
4. As per judgment of Hon’ble Apex Court in the
case of Indian Bank Association, the sworn statement is
considered as evidence of complainant and the
documents produced at the time of sworn statement
considered as documents on behalf of complainant.
Subsequently the statement of the accused has been duly
recorded under section 313 of the Code of Criminal
Procedure. Accused had denied entire incriminating
evidence and he submits that, he has defence evidence.
5. Substance of the accusation was recorded, read
over and explained to the accused who pleaded not guilty
and claimed the trail.
6. The complainant in order to prove its case
examined its authorized person as PW-1 and got marked
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documents as per Ex.P.1 to Ex.P.9. Statement of accused
recorded. In defence evidence accused examined himself
as DW-1. During the cross-examination of PW-1, accused
confronted and got marked Ex.D.1.
7. Heard arguments.
8. The following points arise for determination;
::POINTS::
1. Whether the complainant proves
beyond reasonable doubt that,
accused towards repayment of loan
amount had issued a cheque bearing
No.538485 dated 01.07.2023 for
Rs.1,37,920/- drawn on State Bank
of India, Yelahanka Branch,
Bengaluru in favour of complainant
and the complainant has presented
the said cheque through its banker
for encashment but the same has
been returned on 03.07.2023 with
an endorsement “FUNDS
INSUFFICIENT” thereafter on
24.07.2023 got issued legal notice
to the accused calling upon him to
repay the cheque amount, inspite of
service of the said notice, the
accused not repaid the cheque
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SCCH-5amount and thereby committed an
offence punishable under Sec.138 of
N.I.Act?
2. What Order?
9. My findings on the aforesaid points are;
Point No.1 : In the Affirmative
Point No.2 : As per final order for the
following:
::REASONS::
10. Point No.1:- It is the case of the complainant,
The accused towards partial discharge of outstanding
debt issued the cheque bearing No.538485 drawn on SBI,
Mathura Arcade, Nehru Nagar, Bellari dated 01.07.2023
for Rs.1,37,920/-. The complainant presented the said
cheque for encashment but the said cheque returned with
an endorsement dated 03.07.2023 as “FUNDS
INSUFFICIENT”. On 24.07.2023 the complainant issued
legal notice through RPAD calling upon the accused to
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repay the cheque amount. Inspite of service of notice the
accused failed to make payment of cheque amount.
11. The complainant has to establish the
ingredients for making out the case under Section 138 of
N.I. Act. The complainant has to establish that :
Person issued a cheque on an account
maintained by him in a bank for payment of
service of amount and money to another person
from out of that account for the discharge of any
debt or liability.
That the cheque has been presented to the
bank within a period of three months from the date
of which it is drawn or within the period of its
validity whichever is earlier.
That the cheque is returned by the bank
unpaid either because the amount of money has
been in credit of the account is insufficient to
hand the cheque or that it exceeds amount
arranged to be paid from that account by
agreement made with the bank.
The payee, the holder in due course of the
cheque makes demand for the payment of the
said amount of money by giving notice in writing
to drawer of the cheque within 30 days of the
receipts of information by him from the accused
regarding the return of the cheque as unpaid.
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The drawer of the said cheque fails to make
payment of the said amount of money to the
payee or holder in due course of the cheque
within 15 days of the receipt of the said notice.
The said ingredients are to be established by thecomplainant. In the light of the above discussions the oral
as well as documentary evidence placed on record by the
parties has to be considered.
12. The complainant in order to prove his case
examined himself as PW-1 and documents Ex.P.1 to
Ex.P.9 got marked. In order to prove the case of the
complainant, the complainant produced and got marked
Ex.P.1 GST Certificate, Ex.P.2 cheque, Ex.P.3 Bank
endorsement issued by bank, Ex.P.4 office copy of notice,
Ex.P.5 postal receipt, Ex.P.6 postal track record, Ex.P.7
tax invoice, Ex.P.8 and 9 are the certificates under
Sec.65B of Indian Evidence Act.
9 CC No.13778/2023
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13. The accused not disputed the issuance of
cheque, but contended that, cheque in question was given
by accused for security purpose for an amount of
Rs.1,37,920/-. It is now settled proposition of law that,
cheque issued for security purpose also comes within the
ambit of Sec.138 of N.I.Act. It is the specific contention of
the accused that, he paid Rs.50,000/- to the complainant
and in this regard, Ex.D.1 is got marked by DW-1. The
complainant not disputed about receiving of an amount of
Rs.50,000/- as per Ex.D.1, but he had taken specific
contention that, amount of Rs.50,000/- given by the
accused pertaining to earlier transaction not about the
transaction in which Ex.P.2 cheque is involved.
14. As per cross-examination version of PW-1 it is
specific contention of the accused that, accused had paid
entire amount mentioned in cheque. But it is pertinent to
note that, accused is aware of issuance of cheque to
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complainant. Except asking for return of cheque as per
said testimony nothing is proved by the accused to show
steps taken by him for taking back the cheque from
complainant. The cross-examination of DW-1 that, “ಚೆಕ್
ವಿಚಾರವಾಗಿ ದೂರುದಾರ ಮೆೇಲೆ ಯಾವುದೇ ಪೊಲೀಸ್ ದೂರು ಕೊಟ್ಟಿಲ್ಲ ಆದರೆ ಕೊಡುತ್ತಾ ರೆ
ಎಂದು ಕಾಯುತ್ತಿದ್ದೆ”. This version of DW-1 shows that, he has
not taken any steps for return of cheque from
complainant if he had paid the entire amount. On perusal
of Ex.D.1 on 11.08.2022 an amount of Rs.50,000/- and
on 29.09.2022 Rs.10,000/- transferred to complainant,
but the other 3 entries dated 02.10.2022 and 01.12.2022
(two entries) pertaining to Rs.19,000/-, Rs.20,000/- and
Rs.8,000/- respectively, there is no mention of name of
complainant. The accused not explained in his defence
evidence about the returning of amount mentioned in the
cheque. Hence the contention of the complainant that,
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cheque as per Ex.P.2 was issued by accused towards
legally recoverable debt is proved.
15. Another aspect to be taken into consideration
that, DW-1 admitted that, he received message about
dishonour of cheque. Accused neither taken any steps nor
sent reply to the notice which is the earliest defence
available to the accused. Hence the presenting of cheque
for encashment and non-honouring of cheque for
insufficiency of funds is proved by the complainant.
16. Apart from this, Sec. 139 of the Negotiable
Instruments Act lays down a presumption in favour of the
holder of cheque in the following terms:-
“It shall be presumed, unless the contrary is proved,
that:-
The holder of a cheque received the cheque,
of the nature referred to in Sec.138, for the
discharge, in whole or in part, of any debt or
other liability”.
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Section 118 of the Negotiable Instruments
Act states,
“Until the contrary is proved, the following
presumptions shall be made:-
(a) That every Negotiable Instrument was
made or drawn for consideration and
that every such instrument, when it has
been accepted, endorsed, negotiated or
transferred, was accepted, endorsed,
negotiated or transferred for
consideration.” Thus, the Act clearly lays
down presumptions in favour of the
Complainant with regard to the issuance
of the cheque by the Accused
towards the discharge of his liability
in favour of the Complainant. Under the
scheme of the Act, the onus
is upon the Accused to rebut the
presumptions in favour of the
Complainant by raising a probable
defence. It is a well settled position of
law that, the defence of the Accused, if in
the nature of a mere denial of the case of
the Complainant will not be sufficient to
hold it as a probable defense. The bare
denial of the passing of consideration
apparently does not appear to be any
defence. Something which is probable
must be brought on record for getting
the benefit of shifting the onus of proof
to the Complainant.
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17. It is also a well settled position of law that,
once the cheque is proved to be relating to the Account of
the Accused and he accepts and admits the signature on
the said cheque, then the initial presumption as
contemplated under Sec.139 of the N.I.Act has to be
raised by the courts in favour of the Complainant. The
presumption referred to in Sec.139 of the N.I.Act is a
mandatory presumption and not a general presumption,
but the Accused is entitled to rebut the said presumption.
What is required to be established by the Accused in
order to rebut the presumption is different from each case
under given circumstance. But the fact remains that a
mere plausible explanation is not expected from the
Accused and it must be more than a plausible
explanation by way of rebuttal evidence. The defence
raised by the Accused by way of rebuttal evidence must
be probable and capable of being accepted by the court.
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The Complainant has fulfilled the mandatory
requirements of Sec. 138 of the N.I.Act. Hence I answer
point No.1 in the Affirmative.
18. Point No.2:- In view of my findings on the
above point I proceed to pass the following:
::ORDER::
In exercises of the powers conferred
U/Section.255 (2) of Cr.P.C. the accused is
convicted for the offence punishable
U/Section 138 of Negotiable Instruments
Act.
The accused sentenced to pay fine
amount of Rs.1,42,920/- (Rupees One
Lakh Forty Two Thousand Nine
Hundred Twenty only) in default
accused shall under go simple
imprisonment for 6 months.
Acting under Section 357 (1)(b) of
Cr.P.C out of fine amount, the complainant
15 CC No.13778/2023
SCCH-5is entitle for Rs.1,37,920/- (Rupees One
Lakh Thirty Seven Thousand Nine
Hundred Twenty only) cheque amount
as compensation.
Acting under Section 357 (1)(a) of
Cr.P.C the balance amount Rs.5,000/-
(Five thousand only) is defrayed to the
state for the expenses incurred in the
prosecution.
(Dictated to the stenographer directly on computer, typed by her,
thereof is corrected and then pronounced by me in the Open Court
on this the 14th day of July, 2025)(SHARMILA KAMATH K.)
VIII ADDL. JUDGE, COURT OF
SMALL CAUSES & ACJM
BENGALURU.
::A N N E X U R E::
LIST OF WITNESSES EXAMINED ON BEHALF OF THE
COMPLAINANT:
PW-1 : Sri. Ananda Gowda K.N.
16 CC No.13778/2023
SCCH-5
LIST OF DOCUMENTS MARKED ON BEHALF OF THE
COMPLAINANT:
Ex.P.1 : Copy of Registration Certificate
Ex.P.2 : Original Cheque dated 01.07.2023
bearing No.538485 of Rs.1,37,920/-
Ex.P.3 : Bank Endorsement Ex.P.4 : Copy of Legal Notice dated 24.07.2023 Ex.P.5 : Postal Receipt Ex.P.6 : Postal Track Consignment Record Ex.P.7 : Tax Invoice
Ex.P.8 and : Certificate under Sec.65B of Indian
Ex.P.9 Evidence ActLIST OF WITNESSES EXAMINED ON BEHALF OF THE
ACCUSED:
DW-1 : Sri. Ashok R.
LIST OF DOCUMENTS EXHIBITED ON BEHALF OF
THE ACCUSED:
Ex.D.1 : Copy of Bank Statement
(SHARMILA KAMATH K.)
VIII ADDL. JUDGE, COURT OF
SMALL CAUSES & ACJM
BENGALURU.