Bangalore District Court
M/S Manappuram Chits (Kar) Pvt Ltd vs Lingaraju B T on 28 January, 2025
1 C.C.No.14187/2022
KABC030374262022
Presented on : 12-05-2022
Registered on : 12-05-2022
Decided on : 28-01-2025
Duration : 2 years, 8 months, 16 days
IN THE COURT OF XXXVI ADDL. CHIEF JUDICIAL
MAGISTRATE, BENGALURU CITY
Present: SRI. NITIN YESHWANTH RAO
B.Com. L.L.B(Spl.),
XXXVI Addl. Chief Judicial Magistrate,
Bengaluru.
Dated this 28th day of January 2025
C.C.No.14187/2022
Complainant : M/s Manippuram Chits(K) Pvt, Ltd.,
Office at No.2,
SRS Complex, II Floor,
6th Main, Opp:Head Post Office,
RT Nagar,
Bengaluru.
Rep. By its Sr.Assistant:
Sri.Seshaiah N.
(By Sri. LR Adv.,)
2 C.C.No.14187/2022
V/S
Accused : : Sri.Lingaraj B.T..
S/o Thimmegowda,
Avenue Apartments Ltd.,
Sr.Officer, Transport Shed No.1,
Sy.No.137/1, 139, 140, 150/2,
151, 241, Huuahalli Village,
Jigani Hobli,
Anekal Taluk,
Bengaluru.
(By Sri.RV Adv.,)
Date of Institution of case 2022
Nature of case Private complaint
Date of recording of evidence 9/5/2022
Date of Judgment 28/1/2025
Offences complained of U/Sec.138 of Negotiable
Instrument Act.
JUDGMENT
This is a case arising out of the private complaint filed
by the complainant Chit Company U/Sec.200 Cr.P.C.
3 C.C.No.14187/2022
against the accused alleging the offence punishable
U/Sec.138 of Negotiable Instruments Act.
2. The sum and substance of the complaint is as
follows:
The complainant is a Registered Chit Company engaged
in the business of Promoting and conducting Chits under
the Provisions of Chit Funds Act 1982. The accused
subscribed for a chit bearing No.JNR002LO and Ticket
No.16 for chit value of Rs.2,00,000/- payable at the rate
Rs.5,000/- pm for a period of 40 months.
The accused participated in the chit auction and was
declared Prize Bidder in the said auction and received prize
money of Rs.1,62,000/- on 23/11/2020. The accused along
with his guarantors executed On Demand of Promissory
Note, Surety Form, Guarantee Bond and other relevant
documents in favour of the complainant Chit Company.
After receiving the Prize Amount, the accused was not
regular in payment of the chit installments as he paid only
4 C.C.No.14187/202225 installments and thereafter became a defaulter.
Therefore, the complainant Chit Company issued notice to
the accused and the other guarantors.
After being served in the notice, the accused
approached the officials of the Complainant Company and
issued a cheque bearing No.000008 dated: 1/1/2022 for
Rs.74,881/- drawn on HDFC Bank, Bengaluru towards
payment of the installments.
The complainant presented the said cheque for
collection through its Banker i.e. Karuru Vysya Bank,
Jayanagar Branch, Bengaluru on 1/1/2022. However, the
cheque was dishonoured and returned with an endorsement
funds insufficient in the bank account of the accused.
Pursuant to the same the complainant company issued legal
notice on 27/1/2022 calling upon the accused to pay the
cheque amount within 15 days of the date of receipt of the
notice. Though the notice was duly served on the accused.,
he did not come forward to pay the cheque amount.
5 C.C.No.14187/2022
Constrained by the same, complainant company came up
with this private complaint.
3. After recording the sworn statement of the
complainants representative and on perusal of the
documents produced by him, the presence of the accused
was secured. Plea was recorded. As the accused pleaded not
guilty and claimed to be tried, the case was posted for cross
examination.
4. Then, the case was posted for recording the
statement of accused U/Sec.313 Cr.P.C. In the statement
U/sec.313 Cr.P.C, the accused denied all the incriminating
evidence appearing against him and in defence got himself
examined as DW1.
5. As per guidelines of Hon’ble Apex Court issued in
the case of Indian Bank Association V/s Union of India
reported in (2014)5 SCC 590, sworn statement affidavit of
the complainant’s authorised representative is treated as his
examination in chief. In order to prove his case, complainant
Company got its authorised representative examined as
6 C.C.No.14187/2022
PW1, and got marked 12 documents as Ex.P1 to 12.
6. Then, the case was posted for recording the
statement of accused U/Sec.313 Cr.P.C. In the statement
U/sec.313 Cr.P.C, the accused denied all the incriminating
evidence appearing against him and in defence got himself
examined as DW1.
7. Heard the arguments of learned Counsels for the
complainant and the accused. Meticulously perused the
materials available on record.
8. The following points arise for my consideration:
POINTS
1) Whether the complainant proves
that the accused committed an
offence punishable U/Sec.138 of N.I.
Act?
2) What order ?
9. My findings on the above points are as following:
Point No.1:- In the Affirmative.
Point No.2:- As per final order for the
following:
7 C.C.No.14187/2022
REASONS
10. Point No.1:- In support of its case, the
complainant Company got its authorised
representative examined as PW1, and got marked 12
documents as Ex.P1 to P12. Sri.Sheshaiah N. who is
examined as PW1, reiterated the complaint
averments in his affidavit filed in lieu of chief-
examination. Authorisation Letter and Board
Resolution are marked as Ex.P1 & 2 respectively. The
HDFC Bank cheque bearing No.000008
dated:1/1/2022 for a sum Rs.74,881/- is marked as
Ex.P3. The Bank memo is marked as Ex.P4. The
office copy of the Legal Notice dated: 7/1/2022, 2
postal receipts and acknowledgement card are
marked as Ex.P5 to 8 respectively. Cash voucher,
Promissory Note and Chit Agreement executed by the
8 C.C.No.14187/2022
accused are marked as Ex.P9 to 11 respectively. The
Statement of Accounts is marked as Ex.P12.
11. On careful perusal of these documents, it is
revealed that complainant has complied with all the
essentials enshrined in Sec.138 of NI Act.
Complainant produced the cheque within time for
collection. After it’s dishonor, it also issued legal
notice to the accused. Though the legal notice was
duly served on the accused, he neither paid the
cheque amount within the stipulated period nor did
he issue any reply.
12. When accused failed to repay the amount,
complainant filed this complaint. Hence, records
reveal that complainant is entitled to the
presumption available under sec 118(a) and 139 of
the NI Act.
13. In Rangappa Vs. Mohan reported in 2010 (1)
DCR 706 the Hon’ble Apex court has that ;
9 C.C.No.14187/2022
“The Statutory presumption
mandated by sec.139 of the Act, does
indeed include the existence of a
legally enforceable debt or liability.
However, the presumption U/S 139 of
the Act is in the nature of a rebuttable
presumption and it is open for the
accused to raise a defence wherein the
existence of a legally enforceable debt
or liability can be contested”.
14. Therefore, in view of the above decision, once the
cheque is admitted, the statutory presumption would
automatically fall in favour of the complainant to the effect
that, the alleged cheque was issued for discharge of an
existing legally enforceable debt or liability against the
accused and the burden will shift on to the accused to rebut
the same.
15. The learned Counsel for the complainant
forcefully argued that accused issued the cheque in order to
discharge his liability. As the accused admitted the signature
10 C.C.No.14187/2022
on the cheque and issuance of the same, the learned
Counsel prayed for convicting the accused.
16. Let me now consider whether accused
successfully rebutted the presumption available in favour of
the complainant with probable and convincing evidences. It
is well settled principle of law that, once the cheque is
admitted there will be a statutory presumption in favour of
the holder or holder in due course U/Secs. 118 and 139 of
the Act as observed supra. However, as held by the Hon’ble
Apex Court and our own Hon’ble High Court in a catena of
decisions, the presumptions under the said sections are in
the nature of rebuttable presumptions and hence, the
accused can very well rebut the said presumptions by
leading reasonable and probable defence. Let us examine,
the same on the basis of the materials available on record.
17. To rebut the presumption, the accused got himself
examined as DW1. In his chief examination, the accused
Sri.Lingaraju B.T. stated that he had subscribed a chit for
11 C.C.No.14187/2022
Rs.2,00,000/- with the Complainant Company. He
participated in the bid and received Prize money of
Rs.1,60,000/-. Thereafter, he regularly paid 27 installments
by way of on line transfer. He paid the balance amount by
way of cash.
18. It is further submitted that at the time of receiving
the chit amount he had handed over 2 cheques to the
complainant in the year 2020. Apart from the same, the boys
working at the Complainant Company collected a total sum
of Rs. 65,000/- but did not issue any receipt. After paying all
the installments that the accused asked the complainant to
return his cheques which were handed over for security
purpose. But, the Complainant Company did not return the
cheques and instead presented one of the cheque to the
bank in the year 2022 and when it got dishonoured they
filed this false and frivoulous case to make unlawful gain. As
the accused is not liable to pay any amount to the
Complainant Company. He prayed for acquittal.
12 C.C.No.14187/2022
19. The accused has not disputed the issuance of the
cheque in question and his signature on the same. Further,
Ex.P4 is the Bank Memo. Sec.146 of the NI Act provides
that bank documents are prima-facie evidence in respect of
the transaction. The complainant has issued legal notice as
per Ex.P5 which was duly served on the accused. Despite
the same, the accused did not come forward to pay the
cheque amount within the stipulated period.
20. Accused has nonetheless disputed the transaction
and issuance of Ex.P1 cheque for discharging his legal
liability. Learned Counsel for the accused thoroughly cross
examined PW1. On meticulous perusal of the cross
examination, it is noticed that the accused tried to establish
that he paid 27 installments through online transfer and
rest of the installments by way of cash. When the same was
suggested to the PW1 during the cross examination, he
categorically denied the same. Moreover, this contention
raised by the accused is devoid of merits and unacceptable
13 C.C.No.14187/2022
as the accused did not place on record any evidence either
oral or documentary to substantiate the same.
21. It is very much apposite to note here that the
accused himself admitted during the cross examination that
he has not produce any document to show that he has paid
all the installments. In addition, the accused admitted that
he did not produce any receipts to show that he had paid the
rest of the installments by way of cash. Though the accused
contends that the Complainant Company officials did not
issue any receipts after collecting money, he clearly admitted
that he did not initiate any action against the said officials
who received money but did not issue any receipts for the
same.
22. The other important aspect to be taken note of in
the instant case is that the accused admitted to have
executed Promissory Note and Chit Agreement as per Ex.P10
& 11 respectively. The said documents clearly reveal that the
accused had subscribed chit worth Rs.2,00,000/- and
14 C.C.No.14187/2022
received prize money of Rs.1,62,000/-. Further, the Ex.P12
Account Statement reveals that the accused was liable to
pay a sum of Rs.74,881/- as on the date of re issuance of
cheque.
23. The other significant aspect to be considered in the
instant case is that though legal notice was duly served on
the accused as evidenced by the acknowledgement card
marked at Ex.P8, he did not issue any reply. If at all the
accused had paid all the installments then, he ought to have
issued suitable reply refsing to pay the cheque amount. But,
the accused for reasons best known to him kept mum and
did not issue any reply. Also, he admittedly, did not initiate
any legal action against the Complainant Company for the
alleged misuse of his cheque which was allegedly issued for
security purpose only.
24. As observed supra, the presumption U/s.139 of NI
Act is rebuttable in nature and the standard of proof
required to rebut the said presentation is preponderance of
15 C.C.No.14187/2022
probabilities. On a probable defence which creates doubts
about existence of a legally enforceable debt or liability,
prosecution will fail. While prosecution must establish its
case beyond all reasonable doubt, accused to prove his
defence, must only meet standard of preponderance of
probabilities. It is not necessary for the accused to disprove
the existence of consideration by way of direct evidence. He
has to only discharge initial onus of proof.
25. However, in the instant case, accused did not
adduce probable evidence which would create doubts in the
mind of this Court in respect of the legally enforceable debt.
As far as the defence of the accused is concerned, the
accused merely put suggestions to the PW1 that he had
issued the cheque in question only as security to the chit
fund amount that he has paid all the installments. As the
said suggestions were categorically denied by the
complainant, they cannot be taken as proof of the defence of
the accused in the absence of corroborative evidence either
oral and documentary that the accused failed to place before
16 C.C.No.14187/2022
the Court. It is very much apposite at this juncture to take
note of the following decisions of the Hon’ble Apex Court and
our own Hon’ble High Court.
1. ILR 2019 KAR 493 between Sri.Yogesh
Poojari V/s Sri.K.Shankar Bhat.
2. The decision of the Hon’ble Apex Court
rendered in Crl.Appeals No.849-850/2011
between Triyambak S.Hegde V/s Sripad.
3. 2014 (4) AIR (KAR) 98 between Sripad
V/s Ramdas Shet.
4. (2001) 8 SCC 460 between S.Pitchai
Ganapathi and others V/s Commissioner,
Hindu Religious and Charitable Endowments
Department and others.
26. The ratio laid down in the same, can be summed up
as under:
‘A mere distorted version or mere
taking of the plea or the defence that he
is not liable to any amount is not
17 C.C.No.14187/2022sufficient to put back the burden on the
complainant to prove his case beyond
reasonable doubt. The accused to rebut
the presumption should place
corroborative evidence as proof of his
defence’.
27. Reverting to the case on hand, the accused herein
merely put suggestions to the complainant without placing
on record corroborative evidence due to which his defence
cannot be accepted. As far as his evidence is concerned, the
accused merely stated in the chief examination that the
complainant misused the cheque to file this complaint
without adducing any supporting evidence. It is inexplicable
that the accused has not initiated any action against the
complainant for having misused his cheque to file this
complaint. Therefore, I am of the humble opinion that the
afore cited decisions are very much applicable to the facts
and circumstances of the case on hand.
18 C.C.No.14187/2022
28. Considering all the aforementioned circumstances
and the evidence both oral and documentary placed on
record by both sides, this Court has arrived at the
conclusion that the accused miserably failed to rebut the
presumption available in favour of the complainant.
Complainant on the other hand, successfully established the
factum of issuance of cheque by the accused towards
discharge of his legally enforceable debt. Accordingly, I
answer Point No.1 in the Affirmative.
29. Point No.2:- Complainant Company advanced
prize money of Rs.1,62,000/- to the accused on
23/11/2020. In return the accused issued Ex.P3 cheque
dated:1/1/2022 which came to be dishonoured.
Complainant has been deprived of its money for all this
while. Hence, accused shall compensate the complainant for
the same. Therefore, having regard to the attending
circumstances, this Court is of the considered opinion that
ends of justice would meet if the accused is directed to
19 C.C.No.14187/2022
compensate the complainant by paying him a sum of
Rs.1,10,000/-.
30. In view of my answer to Point No.1 and for myriad
reasons, this Court has come to the conclusion that the
accused committed the offence punishable U/Sec.138 of NI
Act. Accordingly, I proceed to pass the following:
ORDER
Accused is found guilty of the offence
punishable U/Sec.138 of Negotiable
Instruments Act 1881.
Acting U/sec.255(2) of Cr.P.C accused
is hereby convicted for the offence
punishable U/Sec.138 of Negotiable
Instruments Act 1881 and she is
sentenced to pay fine of Rs.1,10,000/-.
In default, accused shall undergo simple
imprisonment for a period of six months.
Out of the total fine amount, a sum
of Rs.1,00,000/- shall be paid to the
complainant as compensation under
section 357 of Cr.P.C. and Rs.10,000/-
shall be remitted to the State exchequer.
20 C.C.No.14187/2022
Further, it is also made clear that in
view of proviso to Sec.421(1), the
accused shall not be absolved of his
liability to pay compensation amount of
Rs.1,00,000/- awarded U/Sec.357 of
Cr.P.C., even if he undergoes the default
sentence.
The bail bond of the accused stands
cancelled.
Office is directed to supply free
copy of this judgment to the
accused forthwith.
(Dictated to the Stenographer in on-line, transcribed and typed
by her, then corrected and pronounced by me in the open Court on
this the 28th day of January 2025).
(Nitin Yeshwanth Rao),
XXXVI ACJM.,
Bengaluru.
:: ANNEXURE ::
1. List of Witnesses examined on behalf of the prosecution :
PW1 : Sri.Seshaiah N.
21 C.C.No.14187/2022
2. List of exhibited documents for complainant :
Ex.P1 & 2 Authorisation Letter and Board Resolution
Ex.P3 T he HDFC Bank cheque bearing No. 000008
dated:19/1/2022 for a sum Rs.74,881/-
Ex.P4 T he Bank memo
Ex.P5 to 8 The office copy of the Legal Notice dated:
7/1/2022, 2 postal receipts and
acknowledgement card
Cash voucher, Promissory Note and Chit
Ex.P9 to 11
Agreement executed by the accused
The Statement of Accounts
Ex.P12
3. List of defence Witnesses :
DW1 : Sri.Lingaraju B.T.
4. List of documents exhibited for defence :
-NIL-
XXXVI ACJM.,
Bengaluru.
22 C.C.No.14187/2022
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