Bangalore District Court
R Kishan Soliwal vs Pearltree Commodities Pvt Ltd on 28 February, 2025
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CC No. 33454/ 2021
KABC030879272021
Presented on : 29-11-2021
Registered on : 30-11-2021
Decided on : 28-02-2025
Duration : 3 years, 2 months, 29 days
IN THE COURT OF XX ADDL.CHIEF JUDICIAL
MAGISTRATE AT BENGALURU CITY
PRESENT: SRI. SHRISHAIL BHIMASHEN BAGADI,
B.Com.,L.L.B.,
XX ADDL. C.J.M., Bengaluru.
Dated this the 28th day of February 2025
C.C.No. 33454/ 2021
Complainant : Mr.R. Kishan Soliwal,
S/o. Late Shri Ramlalji Soliwal
Aged about 65 years,
R/at Old No.11/2, new No.11/11,
Soliwal Mansion,
Lakshmi Road, 1st Floor,
5th Cross,
Shanthinagar,
Bengaluru - 560 027
(By Sri. S Shaker Shetty-Advocate)
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CC No. 33454/ 2021
Accused : 1. Pearltree Commodities Pvt.Ltd.,
No.144A, Lenin Sarani,
1st Floor, Platinum House,
Kolkata - 700 013
Represented by its Chief Executive Officer,
Mr. Kalyan Bhose,
2. Mr.Kalyan Bhose,
Father name not known to the Complainant
Aged about 58 years,
Chief Executive Officer,
Pearltree Commodities Pvt. Ltd.
No.144A, Lenin Sarani
1st Floor, Platinum House,
Kolkata - 700 013
(By Smt.Supritha C - Advocate)
Offence complained : U/S. 138 of N.I. Act.,
Plea of accused : Pleaded not guilty
Final Order : Accused is convicted.
Date of Judgment : 28.02.2025
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CC No. 33454/ 2021
JUDGMENT
The complainant has filed this complaint under
Section 200 of the Code of Criminal Procedure against the
accused, alleging that the accused has committed an
offense punishable under Section 138 of the Negotiable
Instruments Act.
02. The brief facts of the Complainant’s case are as
under;
The accused No.1 is the company represented by its
Chief Executive Officer who is the accused No.2. The
Complainant and accused were acquainted to each other
and the accused had informed the Complainant that he
required some funds for investment and assured repay the
same as and when demanded by the Complainant . Based
on the assurance made by the accused, the Complainant
released funds of Rs.30,00,000/- to the accused. Towards
repayment of the portion of the same the accused issued
following cheques.
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CC No. 33454/ 2021
SL.NO. CHEQUE NO. DATE AMOUNT DRAWN ON
1 053192 30.06.2020 5,00,000/- State Bank of India,
Deshpriya Park, Kolkata
2 053193 30.07.2020 5,00,000/- State Bank of India,
Deshpriya Park, Kolkata
When the complainant presented all the two cheques for
encashment they were returned with endorsement as
“Payment stopped by the drawer” as per the cheque return
memo dated 16.07.2020 & 07.08.2020. The factum of
dishonour of a cheque duly communicated to the accused
through legal notice dated 14.08.2020. The notice issued
by the complainant to was returned as ‘Final Intimation
Served’. Despite the issuance of notice and lapse of the
statutory period of 15 days, the accused did not come
forward to pay the cheque amount nor issued a reply
notice. Therefore, the accused has committed an offence
punishable under Section 138 of the Negotiable
Instruments Act.
03. The complainant to prove the material allegations
made in the complaint examined himself as PW1 and got
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CC No. 33454/ 2021
marked the documents as per Ex.P1 to P8. The court took
cognizance of the offence under Section 138 of the
Negotiable Instruments Act based on the complaint
averments, sworn statement and marked documents and
also registered the criminal case and issued summons to
the accused. On receipt of summons, the accused
appeared before the court through his counsel and was
enlarged on bail. The substance of the accusation read over
and explained to him; he did not plead guilty and claimed
to be tried. In compliance with section 145(1) of the
Negotiable Instruments Act, the sworn statement affidavit
of the Complainant treated as chief examination and
posted the matter for cross examination of PW1,accordingly
the learned counsel for the accused has partly cross
examined the PW1, thereafter the accused remained absent
before the court, despite issuing NBW the presence of
accused could not be secured before the court,
consequently the further cross of PW1 was taken as Nil,
meanwhile the learned counsel for the accused has filed
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CC No. 33454/ 2021
retirement memo which was duly communciated to the
accused through RPAD, despite of that the accused failed
to appeared before the court and to engage another counsel
consequently, the court dispensed recording of statement
of accused under Section 313 of Cr.P.C. as per ratio laid
down by the Hon’ble High Court of Karnataka in Crl.Rev.
Pet.1333/2018 dated 02.02.2023 between Sri.B.N.
Ashwathnarayana V/s. Sri.Shankar, in this case, the
hon’ble High Court has held that, the offense under section
138 of NI Act, has to be tired summarily, and there is no
need to record the statement of the accused under section
138 of the Negotiable Instruments Act, when the accused
intentionally absent before the court to cause delay in
disposal of the case, accordingly the statement of the
accused dispensed with and posted the matter for defense
evidence, but the accused remained absent before the
court, hence the defense evidence of the accused taken as
nil.
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CC No. 33454/ 2021
04. On perusal of the complaint averments and
documents produced along with complaint, the following
points that arise for my consideration;
POINTS FOR CONSIDERATION
1. Whether the complainant proves
beyond all reasonable doubt against
the accused that, the accused had
issued following cheques
CHEQUE NO. DATE AMOUNT DRAWN ON
053192 30.06.2020 5,00,000/- State Bank of
India, Deshpriya
Park, Kolkata
053193 30.07.2020 5,00,000/- State Bank of
India, Deshpriya
Park, Kolkata
to discharge legally recoverable
debt ?
2. Whether the court can dispense
the recording of the statement of the
accused under Section 313 of the
Cr.P.C. in the summary trial ?
3. What Order or sentence ?
05. Heard Arguments from the learned counsel for
Complainant.
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CC No. 33454/ 2021
06. The learned counsel for Complainant in
support of his arguments placed his reliance on the
judgment of the Hon’ble High Court of Karnataka decided
in Crl.Rev. Pet.1333/2018 dated 02.02.2023 between
Sri.B.N. Ashwathnarayana V/s. Sri.Shankar .
07. Upon hearing arguments and on perusal of oral
and documentary evidences made available by the
Complainant and on going through the ratio laid down in
the decision relied upon by the learned counsel for
Complainant, my answers to the above points are as
under.
1. Point No.1: In the Affirmative
2. Point No.2: In the Affirmative
3. Point No.3: As per final order
for the following;
REASONS
POINT No.1 & 2 :
08. These points are inter connected with each
other, hence to avoid repetition of facts and appreciation of
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CC No. 33454/ 2021evidences, both points are taken together for common
discussion.
09. The complainant has filed this complaint
against the accused for the offense punishable under
Section 138 of the Negotiable Instruments Act. The
accused No.1 is the company represented by its Chief
Executive Officer who is the accused No.2. The
Complainant and accused were acquainted to each other
and the accused had informed the Complainant that he
required some funds for investment and assured repay the
same as and when demanded by the Complainant . Based
on the assurance made by the accused, the Complainant
released funds of Rs.30,00,000/- to the accused. Towards
repayment of the portion of the same the accused issued
following cheques.
SL.NO. CHEQUE NO. DATE AMOUNT DRAWN ON
1 053192 30.06.2020 5,00,000/- State Bank of India,
Deshpriya Park, Kolkata
2 053193 30.07.2020 5,00,000/- State Bank of India,
Deshpriya Park, Kolkata
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CC No. 33454/ 2021When the complainant presented all the two cheques for
encashment they were returned with endorsement as
“Payment stopped by the drawer” as per the cheque return
memo dated 16.07.2020 & 07.08.2020. The factam of
dishonour of a cheque duly communicated to the accused
through legal notice dated 14.08.2020. The notice issued
by the complainant to was returned as ‘Final Intimation
Served’. Despite of service of notice the accused failed to
discharge his liability.
10. The complainant to prove his case examined
himself as PW1, in his examination in chief affidavit, he
has reiterated the averments made in the complaint. In
addition to the oral evidence, the complainant has
produced documents as per Ex.P1 to P8. Among these
documents Ex.P1 and P3 are the cheques issued by
accused in favour of complainant and the signature of the
accused is marked as Ex.P1(a) and P3(a), Ex.P2 and P4
are the cheque return memos wherein it is mentioned that
the cheque issued by the accused came to be returned due
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CC No. 33454/ 2021to “Payment stopped by the drawer”. Ex.P5 is the office
copy of the legal notice issued by the complainant in
favour of accused calling upon him to pay the cheque
amount. Ex.P.6 is the postal receipt, Ex.P7 is the closed
postal cover, Ex.P8 is the postal track report. The learned
counsel for the accused has partly cross examined the
PW1, thereafter the remained absent before the court and
the learned counsel for accused has filed retirement memo,
despite of that the accused remained absent before the
court, thereafter, the court took coercive steps by
dispensing the statement of accused under Section 313 of
Cr.P.C. and also taking the defense evidence of accused as
Nil. Now the question that arises before the court is
whether the court can dispense the recording of a
statement under Section 313 of Cr.P.C., In this regard, it is
relevant to see the provisions of law as contemplated under
Section 143 of the Negotiable Instruments Act, which
starts with a non-obstante clause. Section 143 of the
Negotiable Instruments Act speaks that,
12
CC No. 33454/ 2021“notwithstanding anything contained
in the code of criminal procedure
1973, an offenses under this chapter
shall be tried by the Judicial
Magistrate of first class or by
Metropolitan Magistrate and the
provisions of section 262 to 265 (both
inclusive) of the said code shall, as
far as may be, apply to such trials,
provided that in the case any
conviction in summary trial under
this section, it shall be lawful for the
Magistrate to pass sentence of
imprisonment for a term not
exceeding one year and amount of
fine exceeding Rs.5,000/-“. Provided
further that, at the commencement
of, or in the course of, a summary
trial under this section, it appears to
13
CC No. 33454/ 2021Magistrate that the nature of the
case is such that, a sentence of
imprisonment for term exceeding one
year may have to be passed or that it
is, for any other reason, UN-desirable
to try the case summarily, the
Magistrate after hearing the parties
record the order to that effect and
thereafter recall any witnesses who
made have been examined and
proceeded to hear or rehear the case
in the manner provided by the said
code.
11. The provision of Section 143 of the Negotiable
Instruments Act makes it very clear that the offenses under
Section 138 of the Negotiable Instruments Act shall be
tried summarily as per Sections 262 to 265 of the Cr.P.C.
On going through sections 262 to 265 of the Cr.P.C., there
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is no stage for recording the statement of the accused
under section 313 of the Cr.P.C. If for any other reason the
Magistrate forms an opinion that it is undesirable to try the
case summarily and upon passing orders and converting
the case into a summons trial, then only the Magistrate
can record the statement of the accused under Section 313
of Cr.P.C. the same proposition of law has been discussed
in the decision of Hon’ble High Court of Karnataka decided
in Crl.Rev. Pet.1333/2018 dated 02.02.2023 between
Sri.B.N. Ashwathnarayana V/s. Sri.Shankar, wherein
Hon’ble High Court of Karnataka held that, if the accused
remained absent before the court at the time of recording
the statement under section 313 of Cr.P.C. and at the time
of processing judgment and in passing sentence, there is
no requirement of recording statement of the accused
under section 313 of Cr.P.C. as the matter of fact record of
summary trail under section 263 of Cr.P.C. does not
provide for recording of statement under section 313 of
Cr.P.C..
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12. The statement of the accused under Section 313
of the Cr.P.C. in the negotiable instrument act is nothing
but verbatim reproduction of the plea of the accused; if the
accused contests the matter by cross-examining the
complainant and raises a new defence, then only the court
can explain the incriminating circumstances to the
accused other than the verbatim reproduction of his plea.
But in this case, the learned counsel for the accused did
not come forward to further cross-examine the PW.1, and
the accused has not established his defence. Under such
circumstances, postponing the matter for recording of his
statement under Section 313 of the Cr.P.C. is nothing but
wasting the precious time of the court and prolonging the
litigation. If the accused has any valid defense, then he
could have appeared before the court and further cross-
examined the complainant; therefore, recording the
statement of the accused under Section 313 of the Cr.P.C.
is not mandatory when the accused is intentionally absent
before the court.
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13. The complainant, to fulfill the requirements of
Section 138 of the Negotiable Instruments Act, has
produced the documents as per Ex.P1 to P8. On perusal of
Ex.1 and 3 discloses that the accused had issued the
cheques to discharge a portion of legally recoverable debt
of in favour of the complainant. On perusal of Ex.P2 & 4
they were discloses that the cheques in question issued by
the accused came to be returned with the endorsement
“Payment stopped by the drawer”. Further, on perusal of
Ex.P5, it is disclosed that the complainant has demanded
the cheque amount by issuing a legal notice to the accused
personally, calling upon him to pay the cheque amount,
failing which they will be liable to face criminal prosecution
under Section 138 of the Negotiable Instruments Act. On
perusal of Ex.P7 it discloses that the demand notice issued
by the complainant in favour of the accused were returned
as unclaimed, despite of issuance of legal notice, the
accused did not come forward to pay the cheque amount.
Therefore, on perusal of documentary evidence, it is clear
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that, the complainant has complied with the mandatory
requirements of Section 138 of the Negotiable Instruments
Act. In order to bring the accused persons into the purview
of Section 138 of the Negotiable Instruments Act, the
complainant is required to prove the issuance of a cheque
by the accused to discharge legally recoverable debt and
also the issuance of demand notice and failure on the part
of the accused to pay the cheque amount after the lapse of
15 days from the date of receipt of legal notice. Section 139
of the Negotiable Instruments Act speaks that, until the
contrary is proved, the court has to presume that the
cheques in question was issued by the accused to pay the
legally recoverable debt. Further, the accused has not
challenged the issuance of a cheque and signature
appearing on the cheque , which itself is sufficient to prove
the guilt of the accused beyond all reasonable doubt.
Further, the accused remained absent before the court
after recording his plea, and his counsel did not come
forward to cross-examine PW1 to challenge the validity of
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the documents marked in favour of complainant, therefore,
the accused persons have not adduced rebuttal evidence.
14. The Hon’ble Supreme Court of India in the latest
decision reported in 2023 SCC Online SC 1275 between
Rajesh Jain Vs Ajay Singh, in this case the Hon’ble
Supreme Court of India has held that, the legal burden is
the burden of proof which remains constant throughout a
trial. On the other hand, the evidential burden may shift
from one party to another as the trial progresses, according
to the balance of evidence given at any particular stage. In
all trials concerning dishonour of cheque, the court are
called upon to consider whether the ingredients of the
offence enumerated in section 138 of the Act have been
met and if so, whether the accused was able to rebut the
statutory presumption contemplated by section 139 of the
Act, further, it said that section 139 is a reverse onus
clause and requires the accused to prove the non-existence
of the presumed fact, I,e that cheque was not issued in
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discharge of a debt/ liability. Further held that, the NI Act
provides for two presumptions, one under section 118 of
the Act, which directs that it shall be presumed, until the
contrary is proved, that every negotiable instrument was
made or drawn for consideration. Further, under section
139, which stipulates that unless the contrary is proved, it
shall be presumed that the holder of the cheque received
the cheque for the discharge of, whole or part of any debt
or liability. The ‘presumed fact’ directly relates to one of the
crucial ingredients necessary to sustain a conviction under
section 138 of the NI Act. Further held that, section 139 of
the NI Act, which takes the form of a ‘shall presume’ clause
is illustrative of a presumption of law. It is obligatory for
the court to raise this presumption has been established.
But this does not preclude the person against whom the
presumption has been established. But this does not
preclude the person against whom the presumption is
drawn from rebutting it and proving the contrary, as is
clear from the use of the phrase ‘ unless the contrary is
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proved’, after taking note of Bir Singh Vs Mukesh Kumar
(2019)4 SCC 197, wherein it was held that presumption
takes effect even in a situation where the accused contends
that ‘ a blank cheque leaf was voluntarily signed and
handed over by him to the complainant, without admitting
the execution of the entire contents in the cheque, is not
sufficient to trigger the presumption. Further held that, as
soon as the complainant discharges the burden to prove
that, the instrument was issued by the accused for
discharge of debt, the presumptive device under section
139 of the Act, that helps to shift the burden on the
accused of proving that the cheque was not received by the
bank towards the discharge of any liability. Until this
evidential burden is discharged by the accused, the
presumed fact will have to be taken to be true, without
expecting the complainant to do anything further. In the
case of Basalingappa Vs Mudibasappa (2019) 5 SCC 418
held that, to rebut the presumption and prove to the
contrary, it is open to the accused to raise a probable
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defence, wherein the existence of a liability enforceable
debt or liability can be contested. The words ‘ until the
contrary is proved’ occurring in Section 139 do not mean
that accused must necessarily prove the negative that the
instrument is not issued in discharge of any debt/liability,
but the accused has two options. The first option is to
prove that the debt/liability does not exist and conclusively
establish the cheque was not issued in discharge of a
debt / liability. The second option is to prove the non
existence of debt / liability by a preponderance of
probabilities by referring to the circumstances of the case.
The nature of evidence required to shift the evidential
burden need not necessarily be direct I,e oral or
documentary evidence or admissions made by the opposite
party ; it may comprise circumstantial evidence or
presumption of law or fact.
15. Therefore, keeping in mind the ratio laid down
in the above-mentioned decision, it is clear that the
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complainant has proved the initial burden as contemplated
under Section 139 of the Negotiable Instruments Act
regarding the issuance of cheque by the accused to
discharge legally enforceable debt and also proved the
statutory presumption as provided under Section 118(a) of
the Negotiable Instruments Act that he is the holder in due
course of the cheque issued by the accused to discharge
legally enforceable debt. On perusal of complaint
averments, it is disclosed that, the accused has received an
amount of Rs.30,00,000/- and to repay the portion of said
amount and accused had issued the disputed cheques;
therefore, the accused is liable to pay the additional
compensation amount of Rs.1,00,000/-. Therefore, the
complainant has proved his case beyond all reasonable
doubt. Further more, the accused has not contested the
matter by cross examining the PW1, therefore it is a fit
case to convict the accused. Accordingly, I answer point
No.1 and 2 in the Affirmative.
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16. POINT NO.2: In view of the above findings, this
court proceed to pass the following;
ORDER
Acting under Section 255(2) of code
of criminal procedure, the accused No.1
and 2 are hereby convicted for the offense
punishable under Section 138 of
Negotiable Instruments Act.
As per section 357(1)(b) of code of
criminal procedure, the accused No.2
shall pay a fine of Rs.11,05,000/-(Rupees
Eleven lakhs Five Thousand only)
(compensation amount) out of that
Rs.11,00,000/-(Rupees Eleven lakhs
only) payable to the Complainant as
compensation and of Rs.5,000/- (Rupees
Five Thousand only) is remitted to the
state of government, in default of
payment of fine the accused No.2 shall
under go simple imprisonment for a
period of 6 months.
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The bail bond and surety bond
executed by the accused No.2 stands
canceled.
The office is directed to supply free
copy of the judgment to the accused No.2.
{Dictated to the stenographer, transcribed and computerized by her, revised corrected
and then pronounced in the open court on this 28th day of February 2025}.
(SHRISHAIL BHIMASHEN BAGADI)
XX A.C.J.M., Bengaluru.
ANNEXURE
List of witnesses examined on behalf of complainant:
P.W.1 R Kishan Soliwal
List of documents produced on behalf of complainant:
Ex.P.1 & 3 Cheque
Ex.P.1(a) and 3(a) Signature of the accused
Ex.P.2 & 4 Bankers Return Memo
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Ex.P.5 Copy of the legal notice
Ex.P.6 Postal Receipt
Ex.P.7 Closed postal cover
Ex. P8 Postal track report
List of witnesses examined on behalf of accused:
Nil
List of documents produced on behalf of accused:
Nil
XX A.C.J.M.,
Bengaluru.