Bangalore District Court
Jyothi Lakshmi P D vs Chandana Enterprises on 1 August, 2025
KABC030873212022
IN THE COURT OF XX ADDL.CHIEF JUDICIAL
MAGISTRATE AT BENGALURU CITY
PRESENT: BHOLA PANDIT,
B.Com.,LL.M.,
XX ADDL. C.J.M.
Bengaluru.
Dated this the 1st day of August 2025
C.C.No. 37178/ 2022
Complainant : Smt. Jyothi Lakshmi P D
W/o. Sri. Ramakrishnaiah,
Aged about 36 years,
Residing at Mummenahalli,
Soluru Hobli, Magadi Taluk,
Ramanagar District.
{ By Sri. B Srinivasa Reddy - Advocate }
Vs.
1. Chandana Enterprises,
Accused : No.15, 6th Cross,
Srigandha Nagara,
Rajagopalanagara,
2 C.C. 37178 / 2022
Bengaluru
Represented by its
Proprietor Smt. Pushpa
2. Smt. Pushpa
W/o. Sri. Siddaraju,
Aged about 42 years,
Residing at 5th Main Road,
Near Ganesha Temple,
Hegganahalli,
Bengaluru North Taluk
Bengaluru - 560 058
(By Mahesh Kiran Shetty - Adv.)
Offence complained : U/S. 138 of N.I. Act.,
Plea of accused : Pleaded not guilty.
Final Order : Accused is acquitted.
Date of Order : 01.08.2025.
3 C.C. 37178 / 2022
JUDGMENT
The present complaint is filed under section 200 of
code of criminal procedure against the accused seeking to
punish him for the offence punishable under section 138
of the Negotiable Instruments Act ( in short referred as “N.I.
Act“).
02. The factual back drop giving to rise to the filing of
present complaint are stated as under :-
It is alleged that, the accused being the proprietor of
accused No.1 is known to the Complainant . The accused
is came to know about the sale of family property by the
Complainant and her family members in the year 2011
and keeping the sale consideration amount, had
approached the Complainant to advance the hand loan of
Rs.20 lakhs for the expansion of her business. On
13.12.2021 the Complainant has lent a sum of Rs.20
lakhs to the accused by way of cash and has assured to
repay the said amount within 6 months. After the expiry
4 C.C. 37178 / 2022of the said period and to repay the said loan amount the
accused has issued 2 cheques bearing No. 093907 dated
16.05.2022 for Rs.10 lakhs and another cheque bearing
No. 093908 dated 16.05.2022 for Rs.10 lakhs and both the
cheques were drawn on State Bank of India, 2 nd Stage
branch. On 24.05.2022 the Complainant has presented
both the cheques for encashment they returned unpaid
with a shara as ‘Kindly contract drawer drawee bank and
please present again” as per memo dated 25.05.2022.
When this fact was informed to the accused, he requested
the Complainant to represent against, accordingly the
Complainant has represented both the cheques again on
07.06.2022 even then both the cheques have returned
unpaid as per memo dated 08.06.2022, again when this
fact informed to the accused, on her request both the
cheques were represented on 16.02.2022, even at that time
also both the cheques returned unpaid as per memo dated
17.06.2022. Even on the assurance given by the accused
the Complainant has again represented both the cheques
on 03.08.2022, at that time also both the cheques have
5 C.C. 37178 / 2022
returned unpaid with memo date 04.08.2022. On
08.08.2022 the demand notice was issued to the accused
and the said notice return with shara as “intimation
delivered” . In spite of that, the accused neither has paid
the cheque amount nor has given any reply. On these
grounds it is sought to convict the accused and award him
compensation.
03. On presentation of the complaint and after verification
of the records having made out prima facie case, proceeded
to record the sworn statement of the Complainant. As per
verdicts Hon’ble Apex Court reported in AIR 2014 SC 2528
in the case of Indian Bank Association and others V/s
Union of India and others, the sworn statement of the
complainant has been recorded in the form of affidavit as
PW1and got marked documents. Having made out prima
facie case it is ordered to register the complaint in register
No.III and issue process against the accused No.2.
6 C.C. 37178 / 2022
04. In response to the court summons, the accused has
put their appearance before the court through their
counsel and filed bail application under section 436 of
Cr.P.C., along with application under section 145(2) of NI
Act. The plea has been recorded and read over to the
accused, she pleaded not guilty and wanted to put forth
her defense. The accused was permitted to cross examine
PW1. The Learned defense counsel has cross examined
PW1 substantially and on closing the Complainant side,
the statement of accused under section 313 of Cr.P.C. has
been recorded and read over to her, she has denied the
same in toto and and wanted to lead her defense evidence.
She has not given explanation. The defense counsel has
submitted no evidence from the accused side.
05. Heard oral arguments advanced by both the learned
counsel. To buttress his contention the Learned
prosecuting counsel has relied on following judgments.
Sl.No. CITATIONS
1 AIR 2019 SC 2446
7 C.C. 37178 / 2022
2 2010 (11) SCC 441
In support of his oral the Learned defense counsel has
relied following judgments.
Sl.No. CITATIONS
1 Crl. Apl No. 3257/ 2024 (SC)
2 Crl. Apl. No. 1978/ 2013 (SC)
3 AIR 2019 SC 942
4 (2019) 5 SC 418
5 (2015) 1 SCC 99
6 (2008) 4 SCC 54
7 Criminal Appeal No.261/2013 SC
8 2009 Cri.L,J 3777 Bombay H C
9 (2009) 2 SCC 513
06. The following points that arise for my consideration
are as under;
POINTS
1. Does the complainant proves
beyond reasonable doubts that
towards discharge of legally
enforceable debt the accused has
issued cheques bearing No. 093907
8 C.C. 37178 / 2022
dated 16.05.2022 for Rs.10 lakhs,
another cheque bearing No. 093908
dated 16.05.2022 for Rs.10 lakhs
drawn on SBI, Peenya 2nd Stage
Branch, Bangalore ?
2. Does the Complainant further
proves beyond all reasonable doubt
that on presentation of both the
cheques with his banker, they have
returned unpaid for the reasons as
Contact drawer drawee bank and
please present again ?
3. Does the Complainant further
proves beyond all reasonable doubt
that , in spite of issuance of demand
notice the accused failed to pay the
cheque amount ?
4. Does the Complainant further
proves beyond all reasonable doubt
that the ingredients of section 138 of
(a) to (c) of NI Act and thereby the
accused has committed an offense
under section 138 of NI Act ?
5. What Order or sentence ?
07. My findings to the above points is as follows;
1. Point No.1 : In the Negative,
2. Point No.2 : In the Negative,
3. Point No.3 : In the Negative,
4. Point No.4 : In the Negative,
5. Point No.5 : As per final order
for the following;
9 C.C. 37178 / 2022
REASONS
POINT No.1 to 4 :
08. It is the specific case of the complainant that, in
order to improve her business the accused has borrowed
hand loan of Rs.20 lakhs by way of cash from the
Complainant in the month December 2021 with a promise
to repay the same within 6 months. In order to repay the
said hand loan amount the accused has issued disputed
cheques and when both the cheques hae been presented
with his banker thrice, they return unpaid and thereafter
in spite of issuance of demand notice the accused has
neither paid the cheque amount not has given any reply.
Thus, it is sought to convict the accused for the offense
punishable under section 138 of NI Act.
09. To bring home guilt of the accused beyond all
reasonable doubts for the offense punishable u/s 138 of NI
act, the sworn statement of Complainant has been treated
as affidavit evidence as per the verdict of the Hon’ble Apex
10 C.C. 37178 / 2022
court in the case of Indian Bank Association and others
V/s Union of India and others, in his affidavit evidence the
Complainant has replicated the averments of the
complaint. To corroborate the oral testimony of the
Complainant, he got marked 21 documents as Ex.P1 to
P20(a) Ex.P1 and P6 are the disputed cheques, Ex.P2 to 5
and P7 and P10 are the cheque return memos, Ex.P11 is
the demand notice, Ex.P12 and 13 are the postal receipts,
Ex.P14 and P15 are the closed postal envelops, Ex.P16 and
P17 are the copies of acknowledgment issued by the pawn
broker, Ex.P18 is the gold ornaments deposited security
document, Ex.P19 consists of 14 receipts of commission
agents, Ex.P20 is the CC copy of sale deed, Ex.P20(a) is the
certificate under section 65(B) of Evidence Act. The Learned
defense counsel has cross examined PW1 at length. The
accused neither has entered in the witness box to adduce
her oral evidence nor has produced any documentary
evidence. Her counsel submitted no defense side evidence.
11 C.C. 37178 / 2022
10. Before to appreciate the oral and documentary
evidence produced on records, it is imperative on this court
to find out whether the Complainant has proved the
necessary ingredients of section 138 of NI Act before filing
the present complaint.
11. Looking to the dates of disputed cheques and dates of
return memo which marked at Ex.P1 to P10 it can be seen
that disputed cheque have been presented with bank
tricely within the period of their validity and looking to the
date of issuance of demand notice on 08.08.2022 it can be
seen that, within one month from the date of receipt of
return memo, the postal cover produced at Ex.P14 and P15
clearly reveals that, both the notices have returned back to
the sender unserved with a shara as incomplete address
and insufficient address. In the complaint it is pleaded
that, the notice sent through RPAD were returned with
shara ‘intimation delivered’ i.e. not correct. When both the
notices were returned as incomplete address or insufficient
addresses as per Section 27 of General Clauses Act the
12 C.C. 37178 / 2022
theory of deemed services not applicable to the case on
hand. The Complainant has not tried to secure postal
authorities who have made their share on Ex.P14 and P15
and examined them. In order to comply the provisions of
section 138 (b) of NI Act the burden is on the Complainant
to prove that the demand notice was personally served on
the accused then only the offense under section 138 of NI
Act would complete. Even the shown the date of accrual
of cause of action the present complaint came to be filed
before this court on 03.09.2022. Whether this complaint
has filed within 30 days after the expiry of 15 days cooling
period or not is not specifically pleaded. Because the
cooling period of 15 days is provided with moto of giving
one more chance to the accused to pay the amount of the
disputed cheque. Once the accused received the demand
notice he gets an opportunity to pay the cheque amount.
If he make the payment of the cheque amount, the
question of accrual of offense under section 138 of NI Act
and filing the complaint before this court does not arise at
all. Therefore by considering this material evidence, I am
13 C.C. 37178 / 2022
of the considered opinion that, the Complainant has failed
to prove about the compliance of ingredients of section 138
(a) to (c) of NI Act.
12. Section 118 & 139 of NI Act are two important
provisions and they provides for raising mandatory
presumptions in favour of the complainant until the
contrary is proved by the accused. Even in the catena of
decisions i.e., in the case of Rangappa Vs. Mohan reported
in 2010(11) SCC 441, in the case of Bir Singh Vs. Mukesh
Kumar reported in 2019(4) SCC 197, in the case of APS
Forex Services (P) Ltd., Vs.Shakthi International Fashion
Linkers reported in 2020(12) SCC 724, in the case of
Rajeshbai Muljibhai Patel Vs. State of Gujarat, reported in
2020(3) SCC 794, in the case of Triyambak S. Hegde Vs.
Sripad reported in Live Law 2021 SC 492 and in the relied
judgments of the complainant, a precedent is laid down
that, “Once the issuance of cheque and the signature
thereon is admitted by the accused, the court is required
to raise presumption in favour of the the complainant
14 C.C. 37178 / 2022
stating that, the accused has issued the cheque for some
consideration towards discharge of his legal debt or
liability of the complainant and that the complainant is
the due holder of the said cheque. The burden or reverse
onus shifts on the accused to rebut the statutory
presumptions under sections 118(a) & 139 of NI Act.” Now,
it is well established law that, the presumption mandated
by section 139 of NI Act, thus indeed includes the existence
of legally enforceable debt or liability and it is open for the
accused to raise a probable defense wherein the existence
of legally enforceable debt or liability can be contested and
he shall prove before the court on preponderance of
probabilities, only thereupon a statutory presumption
raised in favour of the complainant stands rebutted.
13. In the instance case since demand notice was not
properly served on the accused, the question of giving his
reply and taking defense in the beginning itself does not
arise. During the cross examination of DW1 the accused
has put forth his defense by making suggestion to PW1
15 C.C. 37178 / 2022
stating that, her elder sister by name Jayamma was
running the chit business and accused become the
member of the said chit transaction and in respect of the
said chit transaction, of sister of Complainant had taken
blank cheques from the accused as a security and
thereafter by filing up the said cheques she has filed this
false complaint. By this contention, the accused has
admitting the issuance of cheque from her account and
also by putting her signature on the disputed cheque.
Therefore the Legal presumptions would goes in favour of
complainant and works against the accused. Though the
accused did not entered in the witness box and adduced
her oral evidence, but it is well settled law that, the
accused can very well make use of the evidence of the
Complainant to prove her probable defense in respect of
rebutting Legal presumptions. In respect of raising Legal
presumptions in favour of complainant the Complainant
has relied the judgments of Hon’ble Apex Court in the case
of Bir Singh V/s. Mukesh Kumar and Rangappa V/s
Mohan. On the other hand, the Learned defense counsel
16 C.C. 37178 / 2022
also relied another judgment of Hon’ble Apex Court in the
case of Krishna Janardhan Bhat V.s Dattatreya G Hegde
while interpreting section 139 of NI Act in the case of
Rangappa V/s Mohan the larger bench of Hon’ble Apex
Court held that, only to the extent of drawing presumption
with regard to issuance of cheque for the discharge of
legally recoverable debt includes in the presumptions
provided u/s 139 of NI Act and distinguished the ratio of
Krishna Janardhan Bhat V.s Dattatreya G Hegde case.
Hence the judgments relied by the Learned prosecuting
counsel in respect of raising Legal presumptions are
applicable to the case on hand.
14. To prove his probable defense as discussed above the
Learned defense counsel has cross examined much to
PW1. During her cross examination PW1 has clearly stated
that, she is the BPL card holder. For the benefit of
discussion the said evidence of PW1 is reproduced as “ನಾನು
ಬಿ ಪಿ ಎಲ್ ಪಡಿತರ ಚೀಟಿಯನ್ನು ಹೊಂದಿರುತ್ತೇನೆ ” BPL card means
below poverty line. This card will be issued by the state
17 C.C. 37178 / 2022
Government to those persons who are below poverty line
and to give them free ration, this card would be issued to
the poor persons in the society. By this statement of PW1
it lead doubt in her claim that, she has advanced hand
loan of Rs.20 lakhs in cash. To substantiate her oral
evidence about she was having Rs. 20 lakhs in cash, she
has produced one sale deed marked at Ex.P20. The
recitals of the said sale deed reveals that, in all 10 joint
family members of the Complainant have sold out their
joint family property in the year 2011 for consideration of
Rs.11,50,000/-. If that amount is distributed among 10
persons, each person would get approximate Rs.1,25,000/-
including the Complainant . This property was sold out in
the year 2011 and the present case alleged hand loan was
given in the month of December 2021. No one would
expect or believe that a person who received sale
consideration of Rs.1,25,000/- in the year 2011 would
keep the said amount till December 2021 in the house
only. It is not the case of the Complainant that she has
kept the said amount in her house only. On further
18 C.C. 37178 / 2022
scrutiny of 14 bills produced under Ex.P19 in all those bills
only the amount has been mentioned and the name of the
vegetables is not at all mentioned. Further these receipts
produced under Ex.P19 do not bear the signature of author
of these documents, that apart the Complainant did not
examined the author of these bills to say that the
Complainant was doing vegetables business and she was
used to purchase the vegetables from her only. Therefore
the bills under Ex.P19 do not help the Complainant to
establish her financial capacity. That apart the
Complainant has produced one document at Ex.P18 which
relates to security documents for the deposit of gold
ornaments dated 24.01.2022 wherein it is recorded that,
Mrs. Jayalakshmi P D has deposited 44 grms. gold
ornaments for the loan amount of Rs.1,25,000/-. The
alleged hand loan shown in para No.5 of the complaint is
shown as advanced on 13.12.2021 by way of cash. But
the date on Ex.P18 is 24.01.2022 which is much one
month later for the alleged date of advancing of hand loan.
It appears that, this document produced at Ex.P18 only for
19 C.C. 37178 / 2022
the sake of this case it is produced and same cannot be
considered as relevant evidence and corroborative piece of
evidence. In her cross examination PW1 stated that, her
family is residing in rented house at Hegganhalli cross, for
which they were paying monthly rent of Rs.7,000/- and her
son is also pursuing PUC education and for every year was
spending Rs.1 lakh for his education. She further stated
that, she has been working in a Government Factory from
morning 8.30 to evening 5.30. By considering these
material evidences it can be assumed that, the
Complainant has no financial capacity to lend Rs.20 lakhs
in cash. Further more it is judicially noticeable fact that
till April 2021 the pandemic covid-19 was found in the
entire country. Under such circumstances the
Complainant possessing or accumulating Rs.20 lakhs in
cash leads very much doubtful. On the other hand, the
defense taken by the accused during cross examination of
PW1 stating that, the elder sister of Complainant was
running chit business wherein the accused has become
one of the chit member and for the security of repayment of
20 C.C. 37178 / 2022
chit amount she has given disputed cheques and the said
cheque has been misused and filed this complaint through
PW1 appears to be probable and believable. Accordingly,
the Legal presumptions under section 118 and 139 of NI
Act stands rebutted. On the contrary the Complainant
has miserably failed to prove her case beyond all
reasonable doubts. I have meticulously gone through the
ratio laid down in the relied judgments of the Learned
defense counsel and law laid down in the relied judgments
are applicable to the case on hand. Hence, I answered
point No.1 to 4 in the Negative.
POINT NO.5:
15. In view of the above findings, this court proceed to
pass the following;
ORDER
Acting under Section 255(1) of code
of criminal procedure, the accused is
acquitted for the offence punishable under
Section 138 of Negotiable Instruments Act.
21 C.C. 37178 / 2022
The bail bond of accused and surety
stands canceled subject to appeal period.
{Dictated to the stenographer, transcribed and computerized by her, revised corrected
and then pronounced in the open court on this 1st day of August 2025}.
(BHOLA PANDIT)
XX ACJM,
ANNEXURE
List of witnesses examined on behalf of complainant:
P.W.1 Jyothi Lakshmi P D
List of documents produced on behalf of complainant:
Ex.P.1 & 6 Cheques Ex.P. 1(a) & 6(a) Signatures of the accused Ex.P. 2 to 5 & P7 to 10 Bank endorsements Ex.P. 11 Copy of the legal notice Ex.P. 12 and 13 Postal receipts Ex.P.14 and 15 Closed postal envelops Ex.P.16 and 17 Notarized copies of 22 C.C. 37178 / 2022 acknowledgments for loan Ex.P.18 Notarized copy of gold ornaments deposited documentary Ex.P.19 Receipts - 14 Ex.P20 Online copy of sale deed Ex.P20(a) Certificate u/s 65(B)
List of witnesses examined on behalf of accused:
Nil
List of documents produced on behalf of accused:
Nil
XX A.C.M.M.,
Bengaluru.