Bangalore District Court
Shriram Transport Finance Co. Ltd vs Mallesh Naik on 25 February, 2025
SCCH-17 1 C.C. No. 3675/2023
KABC020115842023
IN THE COURT OF THE XIX ADDL. JUDGE COURT OF
SMALL CAUSES AND A.C.M.M AT BENGALURU
PRESENT: SRI. KANCHI MAYANNA GOUTAM B.A.L., LL.M.,
XIX ADDL. JUDGE,
Court of Small Causes & ACJM,
BENGALURU
Dated: This the 25th day of February- 2025
C.C. No. 3675/2023
Complainant : M/s. Shriram Transport Finance
Co. Ltd.,
Regional office at No.29/A,
2nd floor, K.H. Road,
Bangalore - 560 027
Rep. By its POA Holder,
Sri. Prashantha C.
S/o. Chandrashekara,
Aged about 31 years,,
(By Sri. Manjunatha S., Advocate)
V/s.
Accused : Sri. Mallesh Naik,
S/o. Umala Naik,
R/at No.271, 5, Huttanahally road,
SCCH-17 2 C.C. No. 3675/2023
Chikkajala, Near Anjaneya Temple,
Bangalore - 562 157
(By Sri. Naveen Kumar C.R., Advt)
1. The offence Under Sec. 138 of NI Act
2. Plea of accused Pleaded guilty
3. Final order Conviction
4. Date of judgment 25.02.2025.
JUDGMENT
The complainant has filed this private complaint
under section 200 of Cr.P.C. against the accused for the
offence punishable under section 138 of Negotiable
Instruments Act.
2. The brief facts of the complainant’s case are as
follows:
The complainant stated that the accused is one of the
customer of the complainant company and the accused
has availed vehicle loan on 21.11.2020 for a sum of
Rs.2,25,000/- including financial charges, for the
purpose of the purchase of LCV Manufacturing year
2014, Model Mahindra Bolero Maxi truck plus vehicle
SCCH-17 3 C.C. No. 3675/2023bearing No. KA-64-0649. The accused executed loan
cum hypothecation agreement on 21.11.220 under the
agreement No. YELAHTO11210002 and one Manjunath
M. S/o. Muniyappa is the guarantor. The accused
assured and agreed that the entire amount would be paid
till the settlement of principal amount together with
interest, but the accused failed to pay the monthly
installments regularly and he was in chronic defaulter of
the payment of monthly installments.
The complainant demanded the accused to repay
the outstanding due loan amount and towards the part
payment the accused issued a cheque bearing No.
906337 dated 25.1.2023 for Rs.1,06,865/- drawn on
State Bank of India, Chikkajala Branch, Bangalore –
562 157. As per the assurance of the accused, the
complainant presented the said cheque through his
banker i.e., State Bank of India, Bangalore main branch,
Cubbon park, Bangalore but the said cheque has been
returned unpaid with an endorsement “Funds
SCCH-17 4 C.C. No. 3675/2023Insufficient” and the complainant received the intimation
of dishonour endorsement on 21.2.2023.
After the intimation, the complainant issued a legal
notice dated 4.3.2023 and the said legal notice returned
on 10.3.2023 with an endorsement as ‘Refused’. After
issuance of notice also the accused has neither repaid
the loan amount nor replied to the said notice. Hence,
the complainant having no other option has filed the
present case by alleging that the accused with an
intention to cheat him has issued the said cheque.
3. Upon taking cognizance and after recording the
sworn statement of the complainant, the summons was
issued against the accused. Accused appeared through
his counsel and released on bail. The plea of the accused
recorded by this court. The accused pleaded not guilty
and claimed that he has defence to make. The accused
also filed application under Sec. 145 (2) of NI Act which
came to be allowed by providing the opportunity to the
accused to cross-examine the PW.1.
SCCH-17 5 C.C. No. 3675/2023
4. In order to discharge the burden cast upon the
complainant, the complainant examined its Power of
attorney holder as PW.1 and Ex.P1 to P8. In spite of
sufficient opportunity the accused has not came forward
to cross-examine the PW.1. Hence, the cross-
examination of PW 1 was taken as nil. The accused also
explained about all the incriminating circumstances
available against him by framing the statement under
section 313 of Cr.P.C. The accused has denied all the
incriminatory materials found against him as false and
also submitted that he has evidence to lead. In spite of
sufficient opportunity the accused has not led any
defence evidence. Hence, by taking the defence evidence
as nil, posted the case for arguments.
5. Heard the arguments.
6. On the basis of above contentions and documents,
the following points that arise for my consideration are:
1) Whether the complainant proves beyond
all reasonable doubts that the accused
has issued cheque bearing No. 906337,
SCCH-17 6 C.C. No. 3675/2023dated 25.1.2023 drawn on State Bank of
India, Chikkajala Branch, Bangalore for
a sum of Rs.1,06,885/- towards the
discharge of legally recoverable debt,
which came to be dishonoured as
“Insufficient Funds” and further the
accused has failed to clear the cheque
amount within the statutory period in
spite of issuance of legal notice by the
complainant and thereby the accused
has committed an offence punishable
under section 138 of Negotiable
Instruments Act?
2) What order?
7. My findings to the above points are as under:
Point No. 1 : In the affirmative.
Point No. 2 : As per the final order
for the following reasons.
REASONS
8. Point No. 1 :- It is much relevant to discuss
about the ingredients of section 138 of N.I. Act to
constitute the offence under this Act. In this regard, the
complainant has to show:
i) That the cheque and the signature was
belongs to the accused;
SCCH-17 7 C.C. No. 3675/2023
ii) Such cheque was issued towards legally
recoverable debt;
iii) The said cheque came to be dishonoured;
iv) The accused has not paid the amount
covered under the cheque even after receipt
of notice within stipulated time;
9. To substantiate his case, the the complainant
company examined its authorised representative as PW1
and Ex.P1 to P8 are produced in support of their case.
10. First, for the purpose of establishing the prima
facie case, if we perused the documentary evidence filed
by the complainant which are marked as Ex.P1 to P8, the
Ex.P2 is a cheque, dated 25-01-2023 and the said
cheque was presented and returned unpaid on 21-02-
2023. As per Ex.P3 bank endorsement the cheque was
presented within its validity period. As such, The
requirement under section 138(a) of N.I. Act is fulfilled.
Further, upon presentation of the said cheque Ex.P2, the
drawee bank has given endorsement that the said cheque
Ex.P3 was returned unpaid for the reason of ” Funds
SCCH-17 8 C.C. No. 3675/2023
Insufficient”. The said endorsement of the bank is
marked as Ex.P3. Thereafter, the complainant has
issued legal notice, which is marked as Ex.P4. Ex.P4 is
a written legal notice, dated 04-03-2023. The cheque was
dishonored and returned as per Ex.P3 dated 21-02-2023.
The Ex.P4 legal notice was posted on 04-03-2023 as per
Ex.P5 – postal receipt which is within 30 days of the
receipt of information of cheque being unpaid. As such,
the requirement under section 138(b) of N.I. Act is also
fulfilled. The said Ex.P4 legal notice was returned
unserved as ‘Refused’ on 10-03-2023 as per Ex.P6 postal
cover. Thereafter, the accused has neither given any reply
nor made any payment. As such, the complaint was filed
on 01-04-2023 which is within the period of limitation.
As such, the requirement under section 138(c) of N.I. Act
are also fulfilled.
11. By considering these ingredients of
documentary evidence, it can be held that the
components of section 138 of N.I. Act are fulfilled.
SCCH-17 9 C.C. No. 3675/2023
Keeping this in view let us proceed to examine the oral
evidence available on the record.
12. I am of the opinion that there is no need of
repeating the entire case of the complainant as it is
already narrated in the inception of the judgment.
13. By considering this and also on the evidence
available on the record, it is found that the accused has
not given any reply to the legal notice but the legal notice
was returned unserved as Refused. Further, the
accused has not cross-examined the PW 1 and not
adduced any defence evidence to put up his defence.
Such being the case, it is very difficult to culled out the
defence of the accused.
14. The complainant has filed his affidavit in lieu of
chief examination by deposing that the accused has
issued Ex.P2 cheque to the complainant company for the
repayment of the amount due towards the loan obtained
by the accused. Even after sufficient opportunity the
accused has not cross-examined the PW 1 by denying the
SCCH-17 10 C.C. No. 3675/2023
case of the complainant nor made any suggestion to
disprove the allegations made by the complainant. The
accused has not made any effort to disprove the
execution of Ex.P2 cheque in favour of the complainant
company. The accused nor even denied his signature on
the Ex.P2 cheque. By considering this, nothing is
available on record to disprove or to disbelieve the case of
the complainant company. The oral evidence made by
the PW 1 by filing the affidavit in lieu of his chief
examination is stands unchallenged.
15. Further, if we taken whole materials available
on this case, the accused nor even made any effort to
deny the signature on the Ex.P2 cheque or on the
allegations of the complainant. As stated earlier, the
oral evidence made by the PW1 is not challenged nor
denied. In the absence of denial, issuance of Ex.P2
cheque by the accused has remained undisputed and
unchallenged. It is the rule of essential justice and the
rule of evidence that whenever an opponent has declined
SCCH-17 11 C.C. No. 3675/2023
to avail himself of the opportunity to put his case in
cross-examination, then it must follow that the evidence
render on that issue/material fact ought to be accepted.
This view is also supported from the law laid down by the
Hon’ble High Court of Karnataka in a decision reported in
2004 (5) KLJ 415 (Bobby Mathew V/S C.O.D & Another),
which has been rendered by the Hon’ble Appex Court
which is reported in A.I.R. 2002 S.C. 3652 (Sharavana
Singh V/S State of Punjab). Hence, when the accused
has not denied the material facts of this case, it can be
held that the said material facts are not disputed nor it is
challenged, per contra, it is admitted. Therefore, nothing
on record to disbelieve the say of the complainant
regarding the borrowing of loan by the accused and
issuance of cheque as per Ex.P2 towards the clearance
of the balance. Further, if we taken whole material
available in this case, the accused nor even made any
effort to deny the signature on the Ex.P2 cheque. Hence,
in the absence of denial the precedent held in the above
SCCH-17 12 C.C. No. 3675/2023
two cases by the Hon’ble High Court of Karnataka and
Appex Court squarely applicable to this case to held that
the accused has admitted the issuance of Ex.P2 cheque
for the repayment of amount due by him.
16. As discussed above the Ex.P2 cheque and also
contention of the complainant company about the
issuance of cheque by the accused for the amount due by
him remains unchallenged.
17. When the accused failed to disprove the case of
the complainant in the cross-examination and also failed
to disprove the documentary evidence which were
marked as Ex.P1 to P8 and also when the accused failed
to adduce any evidence to disprove the case of the
complainant, there can be a positive finding in respect of
issuance of cheque.
18. Once the case of the complainant is proved, now
it is the burden of the accused to disprove the case of the
complainant by the probabalized evidence. To disprove
the case, the accused has not led any defence evidence in
SCCH-17 13 C.C. No. 3675/2023
spite of sufficient opportunity. Even though ample
opportunity was provided to the accused, he has not led
any defence evidence in support of his statement
recorded under section 313 of Cr.P.C. and not subjected
himself for the cross-examination. Hence, it can be held
that the accused has not placed any evidence to disprove
the case of the complainant or any effort to put up his
defence.
19. By considering the answer given by the accused
at the time of recording of 313 Cr.P.C. statement the
opportunity was given to the accused to lead defence
evidence to probabalize the above said answer given by
him. As discussed supra, the accused has not led any
defence evidence nor examined himself to disprove the
case of the complainant. In the absence of any evidence
and details, the answer given by the accused cannot be
acceptable. Hence, there is no hesitation for this court to
held that the accused failed to disprove the case of the
complainant.
SCCH-17 14 C.C. No. 3675/2023
20. Once the issuance and signature is proved it is
the burden of the accused to rebut the presumptions
under section 138 and 139 of the N.I. Act, which is
available in favour of the complainant. The same was
observed in the following judgment of Hon’ble High Court
of Karnataka.
K.L.J. 2000(3) Page 481 Dr.K.G. Ramachandra
Gupta & Another V/S Dr. G. Adinarayana.
“NEGOTIABLE INSTRUMENTS
ACT, 1881, Sections 138 and 139 –
Cheque – Presumption about drawing of
– Signature on cheque, admitted to be
that of accused – Held, presumption
envisaged in Section 139 that cheque
was issued for discharging antecedent
liability existing on date which cheque
bears, can be legally drawn.”
21. Under the presumption available under section
118 and 139 of the N.I. Act, if the accused is taking up
the defence of non-passing off of the consideration
mentioned in any Negotiable Instrument, it is
his/accused burden to rebut the presumption. But in
this case, the accused has not denied the allegation of
SCCH-17 15 C.C. No. 3675/2023
the complainant about the issuance of Ex.P2 cheque by
the accused for the payment of amount.
22. The trial of cases under N.I. Act is supported
with the presumption available under section 118 and
139 of N.I. Act. For the proper adjudication of the matter
the accused has to rebut the above said presumption
provided under the N.I. Act in favour of complainant
through other evidence. In this case, the PW 1 is not
cross-examined and the accused has not led any defence
evidence. Mere denial at the time of recording statement
under section 313 of Cr.P.C. is not enough to rebut the
presumption to the extent that the Ex.P2 cheque was not
issued to the complainant. Further, in this case the
accused has not denied the transaction as even he has
not denied the oral and documentary evidence placed by
the complainant. Hence, without any hesitation it can be
held that the presumption available under section 138 of
N.I. Act in favour of the complainant stands unrebutted.
SCCH-17 16 C.C. No. 3675/2023
23. Thereby, further, the transaction and issuance of
cheque is proved before this court. Section 139 and 118
of N.I. Act has favourable presumptions in favour of the
complainant. These presumptions are supported by the
default on the part of accused to cross-examine the PW 1
and also adducing the defence evidence. The accused
has not led any evidence, he has failed to rebut these
presumptions. When the presumptions are not rebutted
and defence not proved by the evidence placed by the
complainant, the burden shifts upon the accused to
rebut the presumption. The accused not placed any
probable defence evidence to disprove the case of the
complainant. Hence, the answer of the accused is not
acceptable in the absence of proper evidence. Thereby,
it can be concluded that the Ex.P2 cheque was issued in
the nature provided under section 138 of N.I. Act. Mere
denial is not sufficient to rebut the presumption in favour
of the complainant. In this regard, it is very incumbent to
quote the following judgments of the Apex Court.
SCCH-17 17 C.C. No. 3675/2023
A.I.R. 2010 SC 1898 Rangappa V/S Mohan
“The presumption mandate by
Sec. 139 of the Act does indeed
including the existence of the legally
enforceable debt or liability.”
Further, in the judgement quoted supra it is
also held that
“The burden of the drawer of the
instrument is not just to create a
doubt or offer explanation, but such
explanations has to be proved
satisfactorily”.
A.I.R. 2001 SC 2895 K.N. Beena V/S Muniyappan
and Another:
“The burden to prove the
consideration for the cheque lies on
the accused if not rebutted, the
presumption is that the cheque was
issued for consideration. It is for
the accused to prove that the
cheque was not issued towards a
debt or liability. He has to lead
credible evidence for the rebuttal of
this presumption. Mere denial of
averments will be suffice to shift this
burden on to the complainant.”
24. These citations are squarely applicable to this
case as there is no denial on the allegations of the
SCCH-17 18 C.C. No. 3675/2023
complainant. The accused has not made out any grounds
to disprove the complainant’s case. On the other hand,
the complainant successfully proved its case beyond all
reasonable doubt. As such, the point No. 1 is answered
in the affirmative.
25. Point No. 2: In view of the above findings on
point No. 1, I proceed to pass the following order.
ORDER
The accused is found guilty of an
offence punishable under section 138 of
Negotiable Instruments Act.
In exercise of powers vested under
section 255(2) of Cr.P.C. 1973, the accused
is convicted for the offence punishable
under section 138 of Negotiable Instruments
Act.
Further, the accused is sentenced to pay
fine of Rs.1,25,000/- (Rupees One lakh
twenty five thousand only). In default, the
accused shall undergo Simple Imprisonment
for the period of six months. It is clarified
that the serving on default sentence will not
absolve the accused on payment of the fine
amount.
SCCH-17 19 C.C. No. 3675/2023
Further it is held that after realizing the
fine amount from the accused, a sum of
Rs.1,20,000/- (Rupees One lakh twenty
thousand only) shall be paid to the
complainant as compensation under section
357(1)(b) of Cr.P.C. and the remaining
Rs.5,000/- (Rupees five thousand only)
shall be adjusted towards the expense of the
State.
The bail bonds of the accused stands
cancelled.
The office is directed to furnish the free
copy of judgment to the accused.
(Dictated to the Stenographer directly on the computer
corrected by me and then pronounced in the open court
on this the 25th day of February, 2025)
KANCHI Digitally signed by KANCHI
MAYANNA GOUTAM
MAYANNA Date: 2025.03.04 11:35:18
GOUTAM +0530
(KANCHI MAYANNA GOUTAM)
XIX ADDL.SMALL CAUSES JUDGE
& ACJM, BANGALORE..
ANNEXURE
List of witnesses examined for the complainant:
PW 1 : Prashantha C.
List of witnesses examined for the accused :
– NIL –
SCCH-17 20 C.C. No. 3675/2023
List of documents marked for the complainant:
Ex.P1 : Copy of Special power of attorney
Ex.P2 : Cheque
Ex.P2(a) : Signature of accused
Ex.P3 : Bank return memo
Ex.P4 : Office copy of legal notice
Ex.P5 : Postal receipt
Ex.P6 : Returned postal cover
Ex.P7 : Statement of account
Ex.P8 : Certificate under sec. 65 B of Evidence ActList of documents marked for the accused :
– NIL –
KANCHI Digitally signed by KANCHI
MAYANNA GOUTAM
MAYANNA Date: 2025.03.04 11:35:13
GOUTAM +0530
(KANCHI MAYANNA GOUTAM)
XIX ADDL.SMALL CAUSES JUDGE
& ACJM, BANGALORE..
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