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APKR050012722022
IN THE COURT OF CHIEF JUDICIAL MAGISTRATE AT VIJAYAWADA.
Present: Smt. B.RADHA RANI, Chief Judicial Magistrate, Vijayawada. Friday, this the 15th day of May, 2026.
Calendar Case No. 1259 of 2022
Between: M/s. Sri Gurudatta Electricals, Rep. by its Managing Partner, Givindaraju Valli Manohar, S/o. (late) G. Dattatreyulu, Aged 67 years, R/o.D.No.12-10-62, Convent Street, Vijayawada.… Complainant.
AND
M/s. Mahi Enterprises, Rep. by Proprietor Talasila Mahendra, S/o. T. Raja Rao, Hindu, Aged 45 years, R/o. Ground Floor, Vinayaka Residency, Housing Colony, Repalle-522 265, Guntur District.… Accused.
This case came on 07.05.2026 for final hearing before me in the presence of Sri T.Bhairraju, learned counsel for the Complainant and of Sri N.Anupama Mohan, learned Advocate for accused, and having stood over for consideration till this day, this court delivered the following: :: J U D G M E N T ::
1. NATURE OF OFFENCE:- This is a private complaint filed U/Sec.190 and 200 of Code of Criminal Procedure (in short Cr.P.C) by Managing Partner of complainant against accused proprietor concern for offence U/Sec.138 r/w 142 of
Negotiable Instruments Act, 1882 (In short N.I.Act) which is summons procedure under code of criminal procedure 1973 ( In short Cr.P.C).
2.THE COMPLAINT IN BRIEF AS FOLLOWS;
a) It is pleaded by complainant that complainant Firm and accused firm used to run Electrical Goods business. Accused is proprietor concern to his firm. He used to purchase electrical goods from Complainant on credit basis by opening credit
Khatha from 2016 to 2018 on different dates . Complainant supplied goods under
Credit Invoices, Dt 26.02.2018, 16.03.2018 & 03.04.2018 to accused. By 03-04- 2018 accused become due for a sum of Rs.12,31,853/- to complainant. As per understanding, as per usage prevailing in mercantile community, accused is liable, pay interest at the rate of 18% per annum on due amount. The complainant filed account statement in support of his case.
b) In spite of repeated demands made by complainant, accused had issued two cheques bearing No.000090, dt.29.07.2020 for Rs.7,00,000/- and another cheque bearing No.000091, dt:29.07.2020 for an amount of Rs.7,00,000/- drawn on Andhra Bank, Isukapalli, Nizamapatnam road, Repalle, towards credit purchases 2 inclusively of interest amount. The same were presented for encashment in his bank i.e., Indian Bank, Vijayawada branch, Vijayawada. But, it were dishonoured by drawee bank for the reason that “FUNDS INSUFFICIENT”. Hence, complainant received the dishonour cheque through cheque return memos of drawee bank dt.03.08.2020.
c) For which, complainant issued a legal notice on 10.08.2020 to the accused demanding to re-pay due amount indebted to him within 15 days from the date of receipt of notice. The notice sent to accused was received by him on 18.08.2020. But, no payment was made by accused. As such, complainant constrained to file this complaint in written against accused for the offence u/sec.138 r/w.142 of NI Act within the jurisdiction of I-town Police Station. Hence, complaint.
3. COGNIZANCE :- After perusing record, my learned predecessor took cognizance for offence U/sec.138 r/w.142 of NI Act, 1881 against accused and issued summon to him by assigning case number as in CC.No.1259/2022.
4. COMPLIANCE OF PROCEDURAL REQUIREMENTS:- The accused after receipt of summon appeared before this court and copies furnished to him as required U/sec.207 of Cr.P.C.
a) Accused was examined u/sec.251 Cr.P.C. by explaining the substance available in the complaint against accused into Telugu language, for which, he was denied the same and claimed to be tried.
5. Trail:- On behalf of complainant, Managing Partner of complainant is examined Pw.1 and exhibited Exs.P1 to P13.
a) On other hand, sole propretor of Accused firm himself is examined as DW.1 and two other witnesses are examined as Dws.2 & 3 on his behalf. No documentary evidence is adduced by accused.
6. Sec.313 (1)(b) of Cr.P.C examination :- Upon closure of evidence the accused was examined u/sec.313 Cr.P.C. calling upon him, to explain for incriminating evidence leveled against him from the evidence of Pw.1 and same were read over and explained to him in Telugu, for which, he denied the same and reported that there is defence evidence.
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7.Learned counsel for the accused has filed Written arguments under Sec.314 of Cr.P.C on behalf accused besides submission of oral arguments. Heard arguments on both sides, perused material record.
8.Now the point for determination is:
Whether the complainant established the essential ingredients of
u/sec.138 r/w.142 of NI Act, 1881 beyond reasonable doubt to the satisfaction
of this Court?
9. In order to establish an offence u/sec.138 of NI Act, the complainant needs to prove:
1. That the cheque issued by accused was presented for collection within period of its validity, as required U/sec.138 (a) of NI Act 1881?
2. That the cheque was dishonoured by the Bank authorities for one of the reasons which attracts the offence u/sec.138 of NI Act, 1881?
3. That drawee issued notice u/sec.138 (b) of NI Act, 1881 within statutory period?
4. That the drawer received the said notice but failed to make any payment covered by the dishonour cheque within stipulated time as mentioned u/sec.138 (c) of NI Act, 1881?
5. That complaint was filed within period of limitation period as per Sec.142 (a) & (b) of NI Act in the Court having jurisdiction?
6. That prima-facie the cheque was issued towards discharging of legally enforceable and subsisting debt?
a) In the judgment of Jugesh Sehgal v. Shamsher Singh Gogi reported in (2009) 14 SCC 683, His Lordships has explained the ingredients of Section 138 of
NI Act offence as follows at para 13:
“13. It is manifest that to constitute an offence under Section 138 of the Act, the following ingredients are required to be fulfilled:
(i) a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account;
(ii) the cheque should have been issued for the discharge, in whole or in part, of any debt or other liability; 4
(iii) that cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity whichever is earlier;
(iv) that cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank;
(v) the payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within 15 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
(vi) the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice. Being cumulative, it is only when all the aforementioned ingredients are satisfied that the person who had drawn the cheque can be deemed to have committed an offence under Section 138 of the Act.”
In other words, the cause of action arises only when the amount remains unpaid even after the expiry of fifteen days from the date of receipt of the demand notice. The above judgment also referred in recent judgment of VISHNOO MITTAL
Vs M/S SHAKTI TRADING COMPANY reported in 2025 INSC 346.
i) So, if at all, above ingredients were proved by complainant or in other words if all points are answered positively in favour of complainant and against the accused, the presumption u/sec.139 of NI Act come into play. Then, burden shifts to accused, in view of sec.118 of NI Act and he has to rebut the presumption arise u/sec.139 of NI Act, 1881 in favour of complainant by placing rebuttal evidence on preponderance of probabilities.
a)To prove all ingredients of provisions of Sec.138 r/w. 142 of NI Act, the complainant is examined as PW.1.
b)Now it has to see whether complainant proved requirements u/sec.138 r/w 142 of NI Act.
10. Point No.1: That cheque issued by accused was presented for collection within period of its validity?
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i)As per the evidence of PW.1, Exs.P1 & P2 – cheque bearing
Nos.000090 & 000091, dt.29.07.2020 issued by accused drawn from Andhra Bank
Isukapalli, Nizamapatnam Road, Repalle for a sum of Rs.7,00,000/- each in favour of complainant towards credit khata loan due indebted by accused to PW.1 under
Exs.P6 to P9/Credit invoices. The same were presented for encashment on 03.08.2020 in the bank of complainant i.e., Indian Bank I-town branch, Vijayawada.
But, the same were returned with an endorsement under Exs.P3 & P4 – cheque return memos dt.03.08.2020 due to “FUNDS INSUFFICIENT”. Therefore, it can be presumed that complainant presented Exs.P1 & P2/cheques in above said Bank for collection within period of its limitation as required Sec.138 (a) of NI Act.
Accordingly point No.1 is answered.
11. Point No.2: Whether cheque was dishonoured by Bank authorities for one of reasons which attracts the offence u/sec.138 of NI Act, 1881?
ii)In the present case, the complainant presented disputed two cheques bearing Nos.000090 & 000091, dt.29.07.2020 for encashment in his bank at Indian
Bank, Vijayawada branch, Vijayawada. The same were returned by complainant bank on 03.08.2020. The nomenclature mentioned in Exs.P3 & P4- cheque return memos plays vital role to make out the offence u/sec.138 of NI Act, so also cheque was returned as “FUNDS INSUFFICIENT” in the account of accused. Hence, said ground of reason would fall within limb of Sec.138 of NI Act.
Accordingly Point No.2 is answered.
12. Point Nos.3 and 4: That drawee issued notice u/sec.138 (b) of NI Act, 1881 within prescribed period under law?
That the drawer received the said notice but failed to make any payment
covered by the dishonour cheque within stipulated time as mentioned
u/sec.138 (c) of NI Act, 1881?
iii)It is testimony of PW.1 that he presented two cheques/Exs.P1 & P2 in
Indian Bank Vijayawada branch, Vijayawada on 03.08.2020 and same were returned under Exs.P3 & P4– cheque return memos with an endorsement of “FUNDS
INSUFFICIENT” dt.03.08.2020. Later, complainant got issued legal notice to accused on 10.08.2020 under Ex.P10 and same was received by accused on 18.08.2020 under Ex.P11/Postal Acknowledgment. On perusing Ex.P11 accused 6 received legal notice which was sent to accused. However, this court holds that complainant deemed to be complied the requirement of Sec.138 (b) of NI Act by issuing legal notice within period prescribed under law. But, within 15 days after returning of legal notice no payment made by accused, as required U/sec.138 (c) of
NI Act. Hence, she filed a complaint before this court.
Accordingly point Nos.3 and 4 are answered.
13. Point No.5: That complaint was filed within period of limitation period in the Court having jurisdiction?
iv) The complainant filed complaint on 05.10.2020 within stipulated time as required under law as accused failed to pay the cheque amounts within 15 days after sending legal notice - Ex.P10 dt.10.08.2020. As per postal Acknowledgment under Ex.P11. Hence, complainant filed complaint within limitation as required
U/sec.142 (a) & (b) of NI Act, before this court having jurisdiction.
Accordingly Point No.5 is answered in favour of the complainant.
14. Point No.6: That prima-facie proof that cheque was issued in discharge of legally enforceable and subsisting debt?
a)To substantiate the case of complainant, it’s managing partner is examined as
Pw.1. He filed his chief Affidavit in lieu of his chief examination. He reiterated the averments of his complaint in his chief affidavit. According to his version, accused opened Credit khata in his M/s. Gurudatta Electricals, for purchasing Electrical goods in running his electrical business with name and style “Mahi
Enterprises” .Under Exs.P6 to P8 three credit invoices vide 1) No.GST/ 1619/17-18 for an amount of Rs.5,06,463/-, dt.26.02.2018, 2) Invoice No.GST/ 1623/17-18 an amount of Rs.4,84,258/-, dt.26.02.2018 and 3) credit invoice No. GST/1777/17-18 an amount of Rs.67,260/-, dt.16.03.2018 and 4) Invoice No.GST/32/18-19 an amount of Rs.2,32,910/- dt.03.04.2018. Accused become due for an amount of
Rs.12,31,853/- to PW.1, as per their understanding and usage prevailing in mercantile community, accused has to pay said amount with interest 18 % pa.
towards said due amount. Then, accused issued two cheques i.e., Ex.P1 & P2 bearing Nos.000090 & 000091, dt.29.07.2020 each for an amount of Rs.7,00,000/-.
As it were dishonoured, this complaint has been filed by complainant by complying the requirements of provisions of sec.138(a)(b)(c) r/w.142 of NI Act.
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b) On other hand, accused/ DW.1 admitted about opening credit Khata in
the firm of complainant. He admitted that from year 2016-2018, he had been
purchased agricultural electrical material from complainant on credit basis, by
cash as well as on-line transaction. He also admitted that DW.1 become due
for sum of Rs.12,00,000/- as on 2018. So, DW.1 admitted about purchasing
electrical goods from complainant on credit basis and he become due for an
amount of Rs.12,00,000/-. Here, according to Pw.1, said due is Rs.12,31,853/-.
DW.1 stated that he did not become for sum of Rs.12,31,853/- as stated by PW.1.
Further, DW.1 deposed that when he become due for Rs.12,00,000/- to complainant, PW.1 asked him to issue two empty unfilled cheques i.e., Exs.P1 & P2 from DW.1 towards security. Accordingly, he issued the same. Subsequently, he had discharged Rs.12,00,000/- under monthly installments to PW.1. Said due had been discharged by him with assistance of Dws.2 & 3. DW.2 and DW.3 have admitted that DW.1 used to purchase electrical goods from PW.1 on credit basis.
They both deposed that DW.1 used to pay due amount to Pw.1 either on cash or online transactions. Dw.2 stated that in between 2017-2018 accused entrusted 4 to 5 lakhs to him with instructions to pay the same to PW.1. Accordingly, he paid said cash to PW.1. Dw.3 stated that in between 2017-2019 accused entrusted
Rs.9,00,000/-lakhs to him with instructions to pay the same to PW.1. He further stated that an amount of Rs.3,00,000/- was paid to Pw.1 in the year 2017 on 03 occasions each for Rs.1,00,000/- Accordingly, he paid said cash to PW.1.Admittedly, from 2018 onwards DW.1 stopped to purchase electrical goods on credit basis from
PW.1.
15. DW.1 further deposed that having received total due amount from him ,this false case is filed by misusing his signed cheques and filled it’s column without his knowledge. He did not issue Exs.P1 & P2 on 29.07.2020 for Rs.7,00,000/- each.
Actually, Andhra Bank was merged with Union bank on 01.04.2020. So, Exs.P1 &
P2 are invalid cheques. As such, this complaint is liable to be dismissed.
16.The learned counsel for accused has argued that there is no written agreement between PW.1 and DW.1 for carrying of credit basis business. Such is the case commercial transaction involved lakhs of amount, in the absence of agreement on credit basis is illegal and unbelievable. So, without an agreement, 8 supply of electrical goods to DW.1 on credit basis for Rs.12,31,853/- is beyond truth.
On said sole ground accused is entitled for benefit of doubt. Hence, prayed the court to acquit the accused.
a) Per contra, the learned counsel for complainant has argued that DW.1 himself admitted about purchasing of electrical goods from PW.1 on credit basis. It is corroborated with his own witnesses i.e., Dws.2 & 3. Such is the case, the above contention of learned counsel for accused has no consideration. Because in carrying business on faith, belief, usage and local customs are used to follow by people.
Hence, prayed the court to convict accused on considering the ocular evidence of
PW.1 coupled with Exs.P1 to P13.
17.On perusing entire evidence this court holds that when Dws.1 to 3 have admitted on oath before court about opening of credit Khata in the firm of complainant by accused being proprietor of his firm and their admissions about purchasing of goods and become due of Rs.12,00,000/-, the above contention of learned counsel for accused has no consideration. Generally, one can carry these types of business on face value, usage and local customs prevailed and practice at their firm place. So, in view of admissions of Dws.1 to 3 the contention of learned counsel for accused about non existence of written agreement, in respect of business transaction between PW.1 and DW.1 is deemed to be not happened and occurred has no consideration. As such, this point is answered against the accused.
18. The learned counsel for accused further argued that PW.1 failed to supply goods under any document duly signed by accused acknowledging the receipt of goods. The GST has not been paid over the Exs.P6 to P9. Hence, prayed the court acquit accused. Here, as already said in above point, DW.1 himself admitted about receipt of goods from PW.1, then there is no further need to prove about supply of goods under a written document. Further on the ground that signatures of accused for proof of receipt of goods are not present in Exs.P6 to P9 is not sustainable before admission of Dws.1 to 3. On further perusal of record, admittedly, no GST has been paid by Pw.1 over invoices due amount under Exs.P6 to P9. But, task of collection of
GST is different aspect which has been dealt by concerned GST department. Non payment of GST is not ground to extend benefit of doubt to accused since subject matter on hand is total different. This court has to examine whether the provisions 9 sec.138 r/w.142 of NI Act has been complied by complainant or not to answer present case.
19.Further, DW.1 admitted his signatures in both cheques Exs.P1 & P2. Admitted facts need not be proved in view of sec.58 of IEA. There are settled legal position to hold that if accused admitted signatures in disputed cheques. Then, this court can presume that Exs.P1 & P2 cheques were issued towards legally enforceable debt existed between parties, unless and until it is rebutted in view of the sec.118 & 139 of NI Act. At this juncture this court inclined to note the relevant judgment on said aspect i.e., the judgment of Beena v., Muniyappan and Another, reported in (2001) 8 SCC 458, wherein his lordships held that
“that under Section 118 of the N.I. Act, unless the contrary is
proved, it is to be presumed that the negotiable instruments
(including a cheque) had been made or drawn for consideration. It
is further observed and held that under Section 139, the Court has
to presume, unless the contrary is proved, that the holder of the
cheque received the cheque for discharge, in whole or in part, of a
debt or liability. It is further observed that thus in complaints under
Section 138, the Court has to presume that the cheque had been
issued for a debt or liability ”.
a) In another judgment Rangappa Vs. Sri Mohan reported in (2010) 11
SCC, our Hon’ble Apex Court has made it clear that “once the issuance of the cheque is admitted or proved, the trial court is duty bound to raise the presumption that the dishonoured cheque placed before it was indeed issued in discharge of a legally enforceable debt or liability of the amount mentioned therein”.
b) Further, in another judgment, Basalingappa vs. Mudibasappa reported in (2019) 5 SCC 418. His Lordship held on para-25.1 to 25.5 as follows the same reproduced for better appreciation as
“25. We having noticed the ratio laid down by this Court in the above cases on
Sections 118(a) and 139, we now summarise the principles enumerated by this
Court in following manner: 25.1. Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.
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25.2. The presumption under Section 139 is a rebuttable presumption and the
onus is on the accused to raise the probable defence. The standard of proof for
rebutting the presumption is that of preponderance of probabilities.
25.3. To rebut the presumption, it is open for the accused to rely on evidence led
by him or the accused can also rely on the materials submitted by the
complainant in order to raise a probable defence. Inference of preponderance of
probabilities can be drawn not only from the materials brought on record by the
parties but also by reference to the circumstances upon which they rely.
25.4. That it is not necessary for the accused to come in the witness box in
support of his defence, Section 139 imposed an evidentiary burden and not a
persuasive burden.
25.5. It is not necessary for the accused to come in the witness box to support
his defence”.
c) In view of above judgments, once issuance of cheque is admitted presumptions can be drawn in favour of complainant who is holder of cheque, to hold that on the date, month and year noted on cheques and for the amount noted therein, it have been issued towards due indebted to PW.1 by DW.1. Here accused has been contending that he issued empty signed cheques/Exs.P1 & P2 towards security. Without his knowledge it’s columns have been filled by PW.1 by misusing his cheques on filing this complaint for wrongful gain. Such version of accused is not sustainable without cogent evidence. However, if a signed cheque is issued to the
PW.1, it is nothing but consenting in filling it’s columns. The relevant judgment is Bir
Singh vs. Mukesh Kumar reported in (2019) 4 SCC 197 where in his Lordships
held as follows "If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars.
This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence.
d) In view of above settled legal position, if a signed blank cheque is voluntarily given to payee towards due amount, payee may fill up its particulars as it is deemed to be consented to do so. In view of the same, the version of DW.1 that without his consent PW.1 filled the columns is also not sustainable. Accordingly, said point is answered against accused.
20.The learned counsel for accused further argued that without filing sec.65-B of
IEA certificate, in respect of Ex.P5, it is inadmissible. Further, as per entries in Ex.P5 an amount Rs.18,60,000/- was shown as due. Such, uncertain amount against the pleadings of PW.1 it cannot be relied upon. So, prayed the court to acquit the 11 accused. Here DW.1 admitted about due amount. Such is the case, though Sec.65-
B of IEA is not being filed for Ex.P5, it cannot be discarded. Further, issuance of cheques are admitted by DW.1. Signatures in both cheques are admitted by DW.1.
Receipt of goods under Exs.P6 to P9 is admitted by DW.1. Further more accused took a discharge plea.
21.Further, at first page of Ex.P5 account statement, said amount of
Rs.18,60,000/- was shown by 13.03.2018 as closing balance. Thereafter in second page by 03.04.2018, due amount was shown as Rs.12,31,853/-. Without noticing second page entry of closing balance noticing entry at first page of Ex.P5 is not sustainable. Further, according to evidence of Pw.1 and DW.1 both cash and online transactions have been took place between them. DW.1 admitted that as on
03.04.2018, he become Rs.12,31,853/- to PW.1. He admitted that no proof of
document is filed to prove the discharge plea subsequent to due date. He
admitted that no proof of documents is filed to say that through Dws.2 & 3, he
had paid some amount to PW.1 in discharge of due amount. Here, mere not
showing payment of Rs.59,038 by cash is not a ground to discard the evidence
of PW.1. Because he did not claim said payment. He claimed only for due as on 03.04.2018 i.e., Rs.12,31,853/- as per the record. As such the contention of learned counsel for the accused has no consideration.
22.The learned counsel for accused further argued that total amount shown in
Ex.P6 to P9 become Rs.12,90,891/- whereas PW.1 claimed due amount
Rs.12,31,853/- and cheques amount as Rs.14,00,000/-. Each one has different quantity is not sustainable. The discrepancy about uncertainty of total due amount in his own documents and interest amount claimed by Pw.1 is good ground to acquit the accused. On perusing the record, there is no such variation as stated by learned counsel for accused. because, an amount of Rs.5,06,463/- was shown in Ex.P6. An amount of Rs.4,84,258/- was shown in Ex.P7. An amount of Rs.67,260/- was shown in Ex.P8. And an amount of Rs.2,32,910/- was shown in Ex.P9. Then, total amount become Rs.12,90,891/- as noticed by the learned counsel for accused. Undisputedly complainant has claimed only Rs.12,31,853/-. Whereas each cheque Exs.P1 & P2 has been issued for Rs.7,00,000/- each i.e., total amount of Rs.14,00,000/-. How, said total amount has been arraigned by DW.1 is not explained by complainant.
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23. Here, accused himself admitted that he paid an amount of Rs.59,038/- to
PW.1 by cash. Such amount, if deducted from Rs.12,90,891/-, then it become
Rs.12,31,853/-. So such thing might have happened to arrive towards said due amount. Further, learned counsel for accused elicited from PW.1 that by calculating interest and principal amount, accused himself noted Rs.7,00,000/- amount in each cheque and handed over to him. Of course, such calculations of interest is not noted in complaint and Chief Affidavit. That itself is not take away the case of prosecution.
Because there is a chance to happen thing like that as stated by PW.1. Be that it may be, when accused admitted his signature and issuance of cheque it is on his shoulder to disprove the case of complainant with cogent evidence. Accordingly point is answered against the accused.
24.The learned counsel further argued that in ledger 24 % pa of interest has been shown. Whereas in legal notice 18 % pa interest alone is shown. There is no written agreement between parties in respect of rate of interest. The calculation of interest is not noted in the averments of complainant. No calculation sheet is filed to say how
Rs.14,00,000/- shown in the cheques. Such doubts are sufficient to extend benefit of doubt.
25. Here, as per the Exs.P6 to P9 24 % pa interest is shown. Whereas in complaint and statutory legal notice or in Chief Affidavit 18 % pa interest is only claimed by Pw.1. When there is no written document excepting document from
PW.1 is not justifiable. This case is not a money suit to file calculation sheet and note about interest for each year. This is NI Act case. Hence, what PW.1 has to do is to comply the requirements of provisions under sec.138 (a)(b)(c) r/w.142 of NI Act.
In view of the same, non filing of calculation sheet on interest is not a ground to extend benefit of doubt to the accused. Accordingly point is answered.
26.The learned counsel for the accused further argued that in the year 2018, two cheques were issued towards security for business transaction between the parties when cheques were issued towards security, it cannot be misused and filed this complaint hence, prayed the court to extend benefit of doubt.
27.Here, mere, denial case of complainant is not sufficient. There is no proof
before court to say that towards security only both cheques Exs.P1 & P2 have been
issued to Pw.1 by DW.1. DW.1 voluntarily stated that he issued signed Exs.P1 & P2 13 by end of 2017. During course of his Chief examination, he himself voluntarily deposed that he was become due for Rs.12,00,000/- as on 2018, again he admitted that he become due for a sum of Rs.12,31,853/- as on 30.04.2018. Further, PW.1 asked him to issue Exs.P1 & P2. Hence, it were issued towards security. Then, for the due and demand in the year 2018, how in ending of 2017 year Exs.P1 & P2 cheques have been issued prior to due amount should be explained by DW.1. No person would issue cheques towards security before a demand or before due amount. As such, the contention of learned counsel accused has no consideration.
Be that it may be, even if two cheques were issued towards security, on its presentation, if it were dishonoured accused is liable for prosecution under sec.138 r/w.142 of NI Act in view of the judgment of V.S. Yadav v. Reena reported in 2010
SCC OnLine Del 3294 wherein in his lord ship held that:
“Mere pleading not guilty and stating that the cheques were issued as security, would not give amount to rebutting the presumption raised under
Section 139 of N.I. Act. If mere statement under Section 313, Cr.P.C. or under
Section 281, Cr. P.C. of accused of pleading not guilty was sufficient to rebut the entire evidence produced by the complainant/prosecution, then every accused has to be acquitted. But, it is not the law. In order to rebut the presumption under Section 139 of N.I. Act, the accused, by cogent evidence, has to prove the circumstance under which cheques were issued. It was for the accused to prove if no loan was taken why he did not write a letter to the complainant for return of the cheque. Unless the accused had proved that he acted like a normal businessman/prudent person entering into a contract he could not have rebutted the presumption under Section 139, N.I. Act”.
a) In view of above judgment of the point is answered against the accused.
28.The learned counsel further argued that there is no explanation for delay in presentation of cheques from the date of issue. Hence, prayed the court to extend benefit of doubt. On perusing record, Exs.P1 & P2 were issued on 29.07.2020.
Whereas, it were presented for honour on 03.08.2020. As per law within three months cheque can be present for honour. In the present case, within said stipulated time, cheques were presented. When a person has a right to present a cheque within three months, he has at liberty to present at any time within said stipulated period. When, PW.1 presented cheques within three months, from the date of issue 14 of cheque the contention of learned counsel for accused has no consideration.
Accordingly, point is answered against accused as right of PW.1 cannot be curtailed.
29.The learned counsel for accused further argued that during July-2020, there was national lock down due to Covid-19. In the pandemic issuing of two cheques for huge amounts on Rs.14,00,000/- is beyond truth. Hence, prayed the court to acquit the accused. No doubt, during the Covid-19 pandemic, subject matter cheques have been issued. In Covid-19 pandemic there would be this type of transactions in running business. When, there is no prevention to have transaction like this nature between the parties during the Covid-19, issuance of cheques cannot be doubted as
DW.1 himself admitted about issuance of cheques to PW.1. Hence point is answered accordingly.
30.The learned counsel further argued that Andhra Bank merged into Union Bank of India on 01.04.2020. Then, issuance of cheque on 29.07.2020 itself shows that both cheques Exs.P1 & P2 were issued towards security for the purpose of business between the parties and it were misused by filing this case. Therefore, prayed the court to extend benefit of doubt.
a) On said aspect, DW.1 himself gave evidence against to the above arguments before court. Such admissions of DW.1 which are in favour of Pw.1 are reproduced hereunder for better appreciation
“It is true Union Bank of India issued circular intimating about validity of
cheques of Andhra Bank till 30.06.2021 after its merge into their bank. It is
true Andhra bank was merged in Union Bank with effect from 01.04.2020”
b) Further, for better appreciation, this court is inclined to scan and paste the copy of Publication available in Internet in respect of validity of cheques of Andhra
Banks after its merge into Union Bank as follows:
15
c) Then, the above own admission of DW.1 would goes to shows that till 30.06.2021, whatever the cheques pertaining to Andhra Bank are valid. In view of the same own admissions of DW.1, the version of learned counsel for accused has no consideration. Because, before the validity time the cheques have been issued and presented. Then, both cheques Exs.P1 & P2 become valid cheques.
Accordingly, point is answered against the accused.
d) The learned counsel for accused further argued that legal notice is not received by accused. The presumption under sec.118 & 139 of NI Act are rebutted by adducing evidence of Dws.1 to 3. There is no proof for supply of goods and also existence of legally enforceable debt. When, cheques were misused, accused is entitled for benefit of doubt. As complainant failed to establish his case. But said submission of learned counsel for accused has no consideration before the own admission of DW.1. DW.1 admitted about receipt of mandatory legal notice prior to filing complaint under Ex.P10. He went to extend that he has contact the PW.1 over phone after receipt of legal notice. He admitted that no reply is issued. He admitted both cheques Exs.P1 & P2 were dishonoured as funds are insufficient in his 16 account. Such is the case, when no reply is issued on receiving legal notice and no defence has been put up at first instance. Subsequently, accused is precluded to deny the case of complaint. The relevant Judgment is MMTC Ltd. and Another vs.
Medchl Chemicals & Pharma (P) Ltd. and Another, (2002) 1 SCC 234 wherein
his Lordships held as follows:
“when a statutory notice is not replied, it has to be presumed that the cheque was issued towards the discharge of liability”.
e) So, without giving reply notice, the version learned counsel for accused has no consideration as already DW.1 admitted about receipt of electrical goods from
PW.1. Before said admission there is no further need to prove said fact as argued by the learned counsel for accused. Further, DW.1 himself admitted about the existence of debt. Then, this court holds that before admission of DW.1, the contention of learned counsel for accused argued above has no consideration.
Further, this court holds that no evidence is adduced by DW.1 to say that towards security only cheques have been issued to PW.1. Accordingly point is answered against the accused.
31.On perusing entire evidence the complainant very much established case beyond reasonable doubt and to the satisfaction of this court. Then, presumptions under secs.118 & 139 of NI Act would comes to rescue by complainant. Then, burden shifts on accused. In this case, accused adduced evidence i.e., evidence of
Dws.1 to 3, in spite of it evidence of PW.1 is not shaken. In fact, he stood for cross examination. Hence, this court has no hesitation, to conclude that accused is failed to rebut the presumptions. In view of the same case of complainant has to be considered.
a) In the light of aforesaid discussion and settled legal positions, this court holds that the complainant succeeded in establishing all essential ingredients of
Sec.138 r/w 142 of NI Act. On the other hand, accused is failed to rebut the presumption under sec.139 of NI Act. Therefore, accused is liable for conviction.
Accordingly all point are answered.
17
32. Result:In the result the accused is found guilty for the offence punishable u/sec.138 r/w.142 of NI Act and he is convicted for the same u/sec.255(2) Cr.P.C.
Dictated to the Stenographer, transcribed and typed by him, corrected and pronounced by me
in open Court on this the 15 th day of May, 2026.
Sd/-B.Radha Rani
Chief Judicial Magistrate, Vijayawada.
a) The accused is questioned about quantum of sentence for the offence punishable u/sec.138 r/w.142 of NI Act for which he pleaded as follows
b) That he is having old aged parents. His both children have been studying higher studies. He is breadwinner of his family. He has to look after his family. If he sent to jail they left the winds, hence prayed the court and show mercy. Therefore, prayed the court to show mercy upon him.
c) Considering the facts and circumstances of the case and also the above submissions of the accused as he issued two cheques to PW.1 and failed to discharge the same debt this court is not inclined to take any lenient view. It is not a fit case to invoke benevolent provisions of Probation of Offenders Act or Section 360 Cr.P.C. But, this court feels that imposing following sentence would meet the ends of justice as imposing fine is not sufficient.
Result:
d) In the result accused is sentenced to undergo Simple imprisonment for a period of SIX months and ordered to pay fine of Rs.5,000/- (Rupees Five
Thousand only) for the offence punishable u/sec.138 r/w.142 of NI Act. In default of payment of fine amount, he shall undergo simple imprisonment for a period of ONE month for the same.
e) Further, accused is directed to pay two cheques amount of Rs.7,00,000/- each i.e., Rs.14,00,000/- to PW.1 within three months from the date of this judgment i.e., as on before 15.08.2026 towards compensation for above offence. In default of payment of compensation, complainant is at liberty to take steps as per law.
f) The Bail bond of accused and his sureties remained in force for period of six months as per Sec.437 (A) of Cr.P.C 18
g) No remand period is undergone by accused for passing an order under Sec. 428 of Cr.P.C.
h) Appraisal of right to prefer appeal: Convict/ Accused is appraised of his right to prefer appeal against judgment of this court. When questioned with regard to means to engage the counsel at appellate stage, he submitted that he has means.
i) Property order:- No order as to property as required under Rule 227 of
Crl.R.P is passed as no property is marked.
j) Copy of Judgment is furnished to accused at free of cost as per sec.363 of Cr.P.C.
Dictated to the Stenographer, transcribed and typed by him, corrected and pronounced by
me in open Court on this the 15 th day of May, 2026.
Sd/-B.Radha Rani
Chief Judicial Magistrate, Vijayawada.
APPENDIX OF EVIDENCE
WITENSSES EXAMINED
For Prosecution: PW.1: G.Valli Manohar
For Defence:
DW.1: T.Mahendra
DW.2: M.Murali Krishna
DW.3: N.Vijaya Kumar
Documents Marked.
For Prosecution:
Ex.P.1Original cheque issued by the accused for Rs.7,00,000/-, Andhra Bank, Isukapalli, Nizamapatnam Road, Repalle bearing No.000090, dt.29.07.2020.
Ex.P.2Original cheque issued by the accused for Rs.7,00,000/- Andhra Bank, Isukapalli, Nizamapatnam Road, Repalle bearing No.000091, dt.29.07.2020.
Ex.P.3Cheque return memo of bearing No.000090, Rs.7,00,000/- of Indian Bank, Vijayawada Branch, Vijayawada-1, dt.03.08.2020.
Ex.P.4Cheque return memo of bearing No.000091, Rs.7,00,000/- of Indian Bank, Vijayawada Branch, Vijayawada-1, dt.03.08.2020.
Ex.P.5Attested true copy of account statement.
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Ex.P.6Attested true copy of credit invoice No.GST/1619/17-18 an amount of Rs.5,06,463/-, dt.26.02.2018.
Ex.P.7Attested true copy of credit invoice No.GST/1623/17-18 an amount of Rs.4,84,258/-, dt.26.02.2018.
Ex.P.8Attested true copy of credit invoice No.GST/1777/17-18 an amount of Rs.67,260/-, dt.16.03.2018.
Ex.P.9Attested true copy of credit invoice No.GST/32/18-19 an amount of Rs.2,32,910/- dt.03.04.2018.
Ex.P.10 Office copy of the demand notice along with postal receipt dt.10.08.2020.
Ex.P.11 Postal acknowledgment dt.18.08.2020.
Ex.P.12 Attested true copy of partnership deed dt.01.07.2007.
Ex.P.13 Attested true copy of certificate of registration of complainant dt.12.10.2001.
For Defence:
-NIL--
M.Os. Marked
--None--
Sd/-B.Radha Rani
Chief Judicial Magistrate, Vijayawada.
//TRUE COPY//
Chief Judicial Magistrate, Vijayawada.
20
CALENDAR CASES TRIED BY CHIEF JUDICIAL MAGISTRATE AT VIJAYAWADA.
Judgment in Calendar Case No.1259 of 2022
Nature of offence U/Sec.138 of NI Act
Date of Judgment : 15.05.2026
Dateof ReportFor ReleaCommenceCloseof Sentence OffenceApprehension se on ment of trialtrialor order of the accusedbail 29.07.2020 10.08.2020 -- --17.06.2025 07.05.2026 15.05.2026
Explanation for delay: The delay is due to non appearance of accused and non production of witnesses.
Complainant: M/s. Sri Gurudatta Electricals, Rep. by its Managing
Partner, Givindaraju Valli Manohar, S/o. (late)
G. Dattatreyulu, Aged 67 years, R/o.D.No.12-10-62,
Convent Street, Vijayawada.
Accused : M/s. Mahi Enterprises, Rep. by Proprietor Talasila
Mahendra, S/o. T. Raja Rao, Hindu, Aged 45 years,
R/o. Ground Floor, Vinayaka Residency, Housing
Colony, Repalle-522 265, Guntur District.
Finding : Guilty.
Sentence : Accused is found guilty for the offence
U/Sec.138 r/w.142 of N.I Act and he is Convicted
U/Sec.255(2) of Cr.P.C for the same.
In the result the accused is found guilty for the offence punishable u/sec.138 r/w.142 of NI Act and he is convicted for the same u/sec.255(2) Cr.P.C.
a) The accused is questioned about quantum of sentence for the offence punishable u/sec.138 r/w.142 of NI Act for which he pleaded as follows 21
b) That he is having old aged parents. His both children have been studying higher studies. He is breadwinner of his family. He has to look after his family. If he sent to jail they left the winds, hence prayed the court and show mercy. Therefore, prayed the court to show mercy upon him.
c) Considering the facts and circumstances of the case and also the above submissions of the accused as he issued two cheques to PW.1 and failed to discharge the same debt this court is not inclined to take any lenient view. It is not a fit case to invoke benevolent provisions of Probation of Offenders Act or Section 360 Cr.P.C. But, this court feels that imposing following sentence would meet the ends of justice as imposing fine is not sufficient.
Result:
d) In the result accused is sentenced to undergo Simple imprisonment for a period of SIX months and ordered to pay fine of Rs.5,000/- (Rupees Five
Thousand only) for the offence punishable u/sec.138 r/w.142 of NI Act. In default of payment of fine amount, he shall undergo simple imprisonment for a period of ONE month for the same.
e) Further, accused is directed to pay two cheques amount of Rs.7,00,000/- each i.e., Rs.14,00,000/- to PW.1 within three months from the date of this judgment i.e., as on before 15.08.2026 towards compensation for above offence. In default of payment of compensation, complainant is at liberty to take steps as per law.
f) The Bail bond of accused and his sureties remained in force for period of six months as per Sec.437 (A) of Cr.P.C
g) No remand period is undergone by accused for passing an order under Sec. 428 of Cr.P.C.
h) Appraisal of right to prefer appeal: Convict/ Accused is appraised of his right to prefer appeal against judgment of this court. When questioned with regard to means to engage the counsel at appellate stage, he submitted that he has means.
i) Property order:- No order as to property as required under Rule 227 of
Crl.R.P is passed as no property is marked.
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j) Copy of Judgment is furnished to accused at free of cost as per sec.363 of Cr.P.C.
Dictated to the Stenographer, transcribed and typed by him, corrected and pronounced by
me in open Court on this the 15 th day of May, 2026.
Sd/-B.Radha Rani
Chief Judicial Magistrate, Vijayawada. Note: 1.Fine amount of Rs.5,000/- paid. As per orders in Crl.M.P.No.667/2026 dt.15.03.2026 bail is granted for production of suspension order till 15.06.2026.
Copy submitted to : 1.The Hon’ble II Additional District and Sessions Judge, Vijayawada 2.The Commissioner of Police, NTR Police Commissionerate, Vijayawada. 3.The learned Assistant Public Prosecutor.
//TRUE COPY//
Chief Judicial Magistrate, Vijayawada.