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IN THE COURT OF THE SPECIAL MAGISTRATE-1 AT VISAKHAPATNAM
Present: Sri B.Sudheer Kumar., Special Magistrate-I Visakhapatnam.
Tuesday the 6th day of May, 2014
C.C.NO.72/2011
1. Serial number of the case : C.C.No.72/2011 (Old C.C.355/2009 of I Addl Chief Metropolitan
Magistrate court, Visakhapatnam).
2. Date of commission of offence : 13-03-2009
3. Name of the complainant : Sri Chetla Prasad Reddy, S/o Late Appala Swamy, Hindu, Aged 44 years, D.No.4-43-2, Vasantha Nilayam, Near Venkateswara Temple, Pedda Waltair, Visakhapatnam.
4. Name of the accused : Sri Koyya. Appala Ramulu Reddy, S/o Yellayya, Hindu, Age 38 years, Ladies Polytechnic college Road, Neeralavalasa Colony, Bheemili, Visakhapatnam.
5. Offence complained off of proved : U/Sec.138 of Negotiable Instruments Act 1881.
6. Plea of the accused and examination : Accused pleaded not guilty. If any.
This case is coming on 06-05-2014 for final hearing before me in the presence of
Sri G.K.P.Reddy and G.Ramu Naidu, Advocate for the complainant and of Smt
K.Prabhavathi, Advocates for the accused and the matter having stood over till this day for consideration and this court delivered the following:
JUDGMENT
1. The indictment against accused is U/sec.138 of N.I.Act. In brief the complaint averments are as follows:
2. Accused for the purpose of necessities, barrowed a sum of Rs.18,00,000/- from the complainant on 7-8-2008, agreeing to repay the same with an interest @ 24% P.A.
Evidencing the receipt of consideration, accused executed a demand promissory note in favour of complainant. Later when accused did not pay the monthly interest, on many a demand, accused issued a cheque for Rs.15,00,000/- dt.13.3.2009 vide cheque bearing 2
No.661650 drawn of his ICICI Bank MVP Colony Visakhapatnam, towards part payment. When the cheque was present for clearance with the complainant’s banker State
Bank of Hyderabad Lance Bay Colony on 20-3-2009, the cheque was dishonoured by the accused banker with an endorsement “INSUFFICIENT FUNDS” vide dt.21-3-2009.
3. Immediately complainant got issued a legal notice 02-04-2009 demanding accused to pay the amount, the same was served on accused on 4-4-2009 but accused without honouring, issued a reply dt.08-04-2009 with false averments. Accused knowing fully well that the cheque would be dishonoured intentionally issued the cheque with oblique motive and a such accused is liable for punishment u/sec.138 of N.I.Act.
4. The case was originally filed in IV Addl Chief Metropolitan Magistrate court,
Visakhapatnam, numbered as C.C.355/2009, later transferred to this court, renumbered as
C.C.72/11. Accused is defended by a counsel. Copies of documents furnished, and on examination u/sec.251 Cr.pc he denied and claimed to be tried. Hence the trial.
5. In order to prove his case, complainant examined himself as P.W.1 and examined
Branch Manager of his bank State Bank of Hyderabad as P.W.2 and examined P.W.3, the
Asst Manager, banker of accused marked Exs.P.1 to P.9.
6. After closer of complainant evidence, accused is examined u/sec.313 Cr.PC apprising him of the incriminating material spoken to by the witness (P.W.1) he denied and stated to have no defence witness to be examined on his behalf and B1 and B2 were got marked through P.W.3.
7. Heard arguments in both sides:
The learned counsel for complainant having placed the record and evidence, argued, by virtue of admission of accused of his issuing the cheque and as he could not rebut the presumption that the cheque is issued towards part discharge of legally enforceable debt covered under the demand promissory note Ex.P.6 it follows that accused is liable for the offence charged.
8. In support of his contention he relied Rangappa – Appellant Versus Sri Mohan
– Respondent reported in 2010(4) Supreme 169 (2) B.V.Rangam – Appellant Verses
B.Govinda Reddy – Respondent (2004) 1 ALD(Crl) at page 810 (3) D.Atchyutha
Reddy : Appellant Verses State of A.P : Respondents (2009) 3 ALT(Crl) 286. The aforesaid decisions refers to sec.139 and presumption which is to be drawn, yet rebuttable and regarding the contention of the claim of accused of accepting the cheque, but contending that he issued a blank cheque. The particulars of the decisions 3 need not be referred at length, the principles are the presumption u/sec.139 can be rebutted by accused that there is no legally enforceable debt or liability on his part and issuance of blank cheque will not absolve accused. The learned counsel for complainant also argued that when a person signs a document containing contractual terms, is bound by the said terms even though he is ignorant of the legal effect, the decision relied need not be referred as it is settled law by virtue sec.91 of evidence Act subject to certain exceptions, and therefore argued accused is liable for the indictment.
9. The learned counsel for accused argued, the testimony of P.W.1 is not reliable, and pointed out discrepancy regarding such huge amount was lent and complainant failed to examine the persons from whom he borrowed the amounts. Non filing of civil suit for recovery of such huge amount and attestors of the demand promissory note are not examined. The learned counsel further argued accused need not lead any evidence in his defence, he can take advantage of the circumstances in the testimony of the complainant and argued complainant failed to prove that accused borrowed amount under Ex.P.6 and had issued the cheque Ex.P1 towards discharge of the debt covered under Ex.P.6.
The learned counsel for accused relied on 1) Krishna Janardhan Bahat V/s
Dattatraya G.Hegde – Respondent reported in 2008 (2) ALT (Crl) 170 SSC (SC). In the said decision of facts it was found there were earlier disputes and in that case amount was said to have been advance on a mere asking without keeping any documentary proof.
In that of the matter their lord ships of honourable Supreme Court observed the court has to assess the evidence keeping in view of the back drop of the circumstances.
2) M/s Kumar Exports – Appellant V/s M/s.Sharma Carpets – Respondent reported in 2009 1 SCC (Crl) 823. In the said decision it was observed by their lord ships of Hon’ble Supreme Court on material that case of accused, blank cheques were obtained as advance was probable and complainant did not produced books of account or stock registered for delivery of goods to the accused.
3) M.S.Narayana Menon @ Mani Vs.State of Kerala reported in 2006(6)
SCC 39. In the said decision it was held that in rebutting the presumption, a probable defence is needed and inference could be drawn not only from material on record but also by reference to the circumstance relied upon. In the said decision it was on facts observed that the cheque was issued by way of security and complainant failed to prove that there was any debt due and that cheque was issued towards of the debt.
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4) G.Ashok Kumar Goud Vs Smt.P.Anjali Bai & another reported in 2012 3
ALT (Crl) at page 14. In the said decisions it was observed that accused need not enter into the witness box in support of his defence. He need not disprove the complainant case by entering into witness box. He may discharge his burden on the basis material already on record. In that case the husband of the 1st respondent borrowed Rs.4,00,000/- under a demand promissory note and the 1st respondent issued the cheque for the amount barrowed by her husband. In that case complainant admitted the wife 1st respondent issued the cheque as a guarantor and in a cross examination complainant admitted that the cheque was issued as security, for the loan and the promissory note was not produced, no books of account were filed and in that case notice was issued by the wife that the blank cheque was obtained by complainant and to return the same. In view of the testimony of the wife and the notices and non production the demand promissory note it was observed that complainant could not prove his case.
10. Point for consideration. Whether the complainant proved that there is legally enforceable debt under the demand promissory note Ex.P.6 and pursuant to the same, accused to issue the cheque Ex.P.1 towards part discharge of legally enforceable debt covered under Ex.P.6.
11. Regarding receipt of the statutory notice there is no dispute as accused issued a reply under Ex.P.5.
12. The main crux of the matter is whether the cheque is issued by accused towards discharge of any legally enforceable debt. Regarding issuance of cheque, there is no denial by accused but he raised the contention that in view of land transaction as security he had given five signed blank cheque to P.W.1 along with four signed blank promissory notes. In Ex.P.5 reply notice accused asserted that his brother one Ramakrishna Reddy purchased a land to an extent of AC 1.00 from Ch.Appalaraju under an agreement of sale dt.23-6-2005 and that was shown to P.W.1 who agreed to purchase and had paid
Rs.10,00,000/-, but the value of the land escalated to Rs.25,00,000/-, and at time of accused receiving Rs.10,00,000/- that he, on demand by P.W.1 had deposited the blank cheques and blank promissory note along with the title deeds and blank signed papers with P.W.1 as security. Later when the said Ch.Appala Raju demanded an additional sum of Rs.5,00,000/- to executed a registered sale deed the dispute arose and the transaction was delayed. Later the brother of accused Ramakrishna Reddy the agreement holder rejected to sell the land and in view of that matter P.W.1 started harassing, ultimately this case is filed by filling the demand promissory note and the 5 cheque. Now the point which would arise is whether accused had placed any material in that regard. P.W.1 totally denied during the cross examination when the aforesaid contention was put forth. It is settled law mere suggestions will not have any evidentiary value unless any sustentative material is placed in that regard.
13. P.W.1 the complainant deposed with regard to his complaint averments and his testimony stood unrebutted and he did not budge in any count as per the contention of accused put forth. If so by virtue sec.118 and 139 of the N.I.Act the presumption has to be drawn. To rebut the same, accused need not place material within the purview of strict proof as that of the complainant, he also need not enter into witness box, but when he had raised specific plea, it is the duty of accused to put forth his plea specifically or he can ask the court to look into the circumstance. In the present case on hand except suggesting to P.W.1, no substantive effort is made by accused to infer for what accused pleaded may be true. Accused did not examine his brother Ramakrishna Reddy as he claimed the present case is an off shoot of land transaction. Non examination in view of specific plea raised by accused stares at him, by which, in all probabilities I have to hold accused could not rebut the presumption.
14. It may be a fact that P.W.1 had not examined any of the attestor of the demand promissory note Ex.P.6. Since demand promissory note is not a compulsarly attestable document, non examination of attestors or scribe will not have any bearing. In order to infer any false implication in the land transaction there should be same semblance of truth or probable circumstance, but in present case practically there is no material.
15. It may be a fact P.W.1 the complainant did not place any material from whom he borrowed the amounts to lend the same to accused. He also had not shown the amount in his Income Tax returns. In view of that matter he learned counsel for accused argued complainant failed to place the record or evidence of lending such huge amount and also contended non filing of Civil Suit for such a huge amount also make the case of complainant doubt full. But the fact should not be forgotten that the accused in his reply notice Ex.P.5 admitted above the transaction and it is elicited from P.W.1 that P.W.1 is carrying on second hand car business. Therefore the financial capacity of complainant cannot be clouded simply because P.W.1 the complainant could not mention the names of the persons from whom borrowed to lend to accused and non examination of others will not have any effect until and unless accused places some material to infer that the case of complainant is not true. Therefore the decisions relied counsel by accused will not have any baring in the present case on hand so as to infer that accused could rebut the presumption.
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16. When once accused admitted that he signed in the demand promissory note
Ex.P.6, he is bound by the recital therein under the N.I.Act and it follows that Ex.P.6 demand promissory note is executed for consideration mentioned therein, which is legally enforceable debt. Now coming to E.xP.1 cheque. Issuance of blank cheque will not absolve accused. He pleaded P.W.1 obtained as security, in the land transaction, had he examined his brother at least, this court would have an opportunity to assess the contention raised by accused. When he did not choose to do so, the said circumstance would stare at him, consequently it has to be held that accused had issued ExP.1 cheque towards part discharge of the debt covered under ExP.6 demand promissory note and the presumption available under 118 and 139 of N.I.Act to be drawn and when accused could not place any material to rebut, it follows that accused had issued the cheque Ex.P.1 towards discharge of legally enforceable debt covered under Ex.P.6 demand promissory note.
17. In the present case on hand complainant examined P.W.2 the Branch Manager of the complainant bank and P.W.3 Asst Manager of accused bank. Through P.W.3 Ex.B.1 the letter addressed by accused to Stop payment of seven cheques was marked which is dt.04-04-2009, Ex.P.1 is one of the cheque. By the time Ex.B.1 dt.04-04-2009, cheque
Ex.P.1 was already bounced. Under Ex.B.2 the letter issued by accused banker only five cheques were mentioned of different numbers and the present cheque was not mentioned, by which time a demand notice under Ex.P.3 was issued to accused by complainant. The aforesaid show the conduct of accused to get over from the trouble he landed.
18. Therefore in view of aforesaid discussed material on record no other conclusion can be drawn except that the accused had issued the cheque Ex.P.1 towards discharge of legally enforceable debt as claimed by the complainant under Ex.P.6 demand promissory note.
19. In the result accused is found guilty for the offence charged u/sec.138 of N.I.Act and consequently is convicted u/sec.255 (2) CrPC.
20. As regards quantum of sentence, sec.138 of N.I.Act is more or less a punitive and restitutive relief which can be accorded, according to the circumstance, therein. Hence I am of considered view if fine is imposed it would meet the ends of justice. Therefore accused is sentenced to pay a fine of Rs.16,10,000/- (Rupees Sixteen lakhs ten thousand only) , out of which Rs.16,00,000/- (Rupees Sixteen lakhs only) is payable to the complainant towards compensation together with interest @ 9% P.A till realization and the remaining amount of Rs.10,000/- is ordered to be remitted. Indefault accused to undergo simple imprisonment for the period of three months.
Typed to my dictation, corrected and pronounced by me in open court on this the 6th May, 2014.
Special Magistrate-I, Visakhapatnam.
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APPENDIX OF AVIDENCE
1.List of witnesses examined on behalf of Complainant:
P.W.1 Sri Ch.Prasad Reddy P.W.2 Sri A.Papa Rao P.W.3 Sri M.Jalandhar
2. List of witnesses examined on behalf of the accused: NIL
3. List of documents marked on behalf of Complainant:
Ex.P.1 Original cheque for Rs.15,00,000/- dt.13-03-2009.
Ex.P.2 Cheque returns memo dt.21-03-2009.
Ex.P.3 Lawyer’s notice dt.02-04-2009
Ex.P.4 Acknowledgment dt.06-04-2009
Ex.P.5 Reply notice dt.03-04-2009
Ex.P.6 Pronote original dt.07-08-2008
Ex.P.7 Statement of account of the complainant
Ex.P.8 Authorization letter dt.29-02-2012
Ex.P.9 Ledger account of the accused dt.03-04-2009
4. List of documents produced by the witness. NIL
5. Document marked on behalf of accused:
Ex.B.1 Letter
Ex.B.2 Reply given by the bank
Sd/B.Sudheer Kumar Special Magistrate-I, Visakhapatnam.
\\ True Copy //
Head Clerk Special Magistrate court –I, Visakhapatnam 8
CALENDAR AND JEDGMENT
DISTRICT : : VISAKHAPATNAM
IN THE COURT OF THE SPECIAL MAGISTRATE-1, VISAKHAPATNAM
C.C.NO.72/2011
DATE OF OFFENCE:
1. Report of complaint : 04-05-2009
2. Apprehension of accused : 23-01-2010
3. Release of Bail : -
4. Commencement of trail : 13-04-2010
5. Close of trail : -
6. Sentence of order : 06-05-2014
EXP LANATION FOR THE DELAY:
The delay is due to non-production of witnesses by the complainant.
JUDGMENT IN CALENDAR CASE NO: C.C.No.72/2011 (Old C.C.No.355/2009 on the file of I Addl Chief Metropolitan Magistrate’s court, Visakhapatnam), on the file of I
SPECIAL MAGISTRATE COURT, VISAKHAPATNAM.
COMPLAINANT:
Sri Chetla Prasad Reddy, S/o Late Appala Swamy, Hindu, Aged 44 years, D.No.4-43-2, Vasantha Nilayam, Near Venkateswara Temple, Pedda Waltair, Visakhapatnam.
ACCUSED:
Sri Koyya. Appala Ramulu Reddy, S/o Yellayya, Hindu, Age 38 years, Ladies Polytechnic college Road, Neeralavalasa Colony, Bheemili, Visakhapatnam.
OFFENCE: Dishonor of cheque for insufficiency of funds etc., punishable under Section 138 of Negotiable Instruments Act.
FINDING : Accused is found guilty, for the offence under section 138 of Negotiable Instruments Act, 1881.
SENTENCE : In the result the accused is found guilty for the offence punishable under section 138 of N.I.Act and the accused is convicted under section 255 (2) Cr.P.C. Accused is sentenced to pay a fine of Rs.16,10,000/- (Rupees Sixteen lakhs ten thousand only), out of which Rs.16,00,000/- (Rupees Sixteen lakhs only) is payable to the complainant towards compensation together with interest @ 9% P.A till realization and the remaining amount of Rs.10,000/- is ordered to be remitted. Indefault accused to undergo simple imprisonment for the period of three months.
Sd/B.Sudheer Kumar Special Magistrate-I, \\ True Copy // Visakhapatnam.
Head Clerk Special Magistrate court –I, Visakhapatnam