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IN THE COURT OF THE III ADDITIONAL DISTRICT & SESSIONS
JUDGE – CUM – PRINCIPAL FAMILY COURT JUDGE,
MEDCHAL–MALKAJGIRI DISTRICT AT KUKATPALLY.
PRESENT: Sri B.Thirupathi, III Addl. Dist. & Sessions Judgecum Prl. Family Court Judge, Medchal Malkajgiri District at Kukatpally
Dated this the 21st day of May, 2025
Criminal Appeal No.71 of 2023
Between:
Smt. Atmakuri Anusha, W/o. Rallabandi Pranaj Raj, Aged about 37 years, Occ: Business, R/o. Plot No.1701, Gemini Vista Apartment, Pragathi Nagar, Bachupally Mandal, MedchalMalkajgiri District – 500 090, T.S.
And also, at M/s. Yeshika Boutique, Shop No. G2, Quality Pragathi Apartment, Beside Himagiri Saroja Apartments, Near Elephant Circle, Pragathi Nagar, Bachupally Mandal, MedchalMalkajgiri District – 500 090, T.S.
... APPELLANT / ACCUSED
AND
Smt. Sarepalli Harika, D/o. Satyanarayana, Aged about 33 years, Occ: housewife, R/o. Flat No. G2, Himagiri Saroja Apartments, Elephant Circle, Pragathi Nagar, MedchalMalkajgiri District – 500 090, T.S.
... RESPONDENT / COMPLAINANT
AN APPEAL AGAINST THE JUDGMENT OF CONVICTION AND
SENTENCE VIDE JUDGMENT DATED: 20.07.2023 PASSED BY THE
COURT OF THE PJCJCumXI ADDL. METROPOLITAN
MAGISTRATE, MEDCHALMALKAJGIRI DISTRICT AT
KUKATPALLY
CC NO.405 of 2021
BETWEEN:
Sarepalli Harika, D/o. Satyanarayana, Aged about 31 years, Occ:Housewife, R/o. Flat No.G2, Himagiri Saroja Apartments, Elephant Circle, Pragathi Nagar, Hyderabad.
... COMPLAINANT
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AND
Smt. Atmakuri Anusha, W/o. Rallabandi Pranaj Raj, Aged about 35 years, Occ: Business, R/o. Plot No.1701, Gemini Vista Apartment, Pragathi Nagar, Bachupally, Hyderabad – 71.
And also at M/s. Yeshika Boutique, Shop No.G2, Quality Pragathi Apartment, Beside Himagiri Saroja Apartments, Near Elephant Circle, Pragathi Nagar, Bachupally, Medchal District – 72.
... ACCUSED
This Criminal Appeal is coming before me on 08.05.2025 for final hearing and disposal, in the presence of Sri B. Sudhakar, Counsel for the Appellant / Accused and M/s. B. Padma Rao & Associates, Counsel for Respondent / Complainant and upon perusing the grounds of appeal, Judgment of Trial Court and material record of the case and arguments of the above counsels having stood over for consideration till this date the court made the following:
J U D G M E N T
1.This is an appeal preferred by the appellant/accused against the
Judgment passed by the Court of the XI Addl. Metropolitan
Magistrate, MedchalMalkajgiri District at Kukatpally in CC No.405 of
2021 dated: 20.07.2023, where in the accused is found guilty for the offence U/Sec. 138 of Negotiable Instrument Act and he is convicted
U/Sec 255 (2) of Cr.P.C., and she is sentenced to undergo simple imprisonment for Three Months and to pay Rs.6,00,000/ the cheque amount as compensation and on payment of Rs.6,00,000/ by the accused, the same ie., Rs.6,00,000/ shall be paid to the complainant under section 357 (3) of Code of Criminal Procedure.
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2.The facts of the case of the complainant in brief are as follows:
The complainant is running the business of Beauty Parlours having two branches in Bachupally area in the name of Sitara Herbal
Beauty Parlour and Harixs Herbal Beauty Parlour at Pragathi Nagar,
Kukatpally since 8 years. The accused is also running a beauty parlour in the name of M/s. Bliss Beauty Parlour and Boutique,
Pragathi Nagar, Kukatpally. The complainant and the accused are neighbors, therefore, they got acquaintance with each other, having that acquaintance the accused approached the complainant in the month of March, 2017, proposed for purchase of two beauty parlours maintained by the complainant for which the complainant had also agreed, accordingly, in the month of April 2017 the complainant and the accused have arrived to a conclusion of sale consideration as
Rs.10,000,000/. It is also submitted that on 15.05.2017 the accused paid an amount of Rs.2,00,000/ to the complainant towards advance sale consideration. The complainant and accused have entered into an agreement of sale, dt.22.05.2017. The total sale consideration
Rs.9,00,000/ was mentioned in the said agreement of sale and when the complainant questioned the same, the accused informed that
Rs.1,00,000/ will be paid at the time of final payment. The complainant had handed over the two beauty parlour maintained by 4 Crl.Appl. No.71 of 2023
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her to the accused on 01.06.2017. The accused paid Rs.2,00,000/ as part of sale consideration and for the remaining amount the accused issued a cheque bearing no.000131 for Rs.2,50,000/ and the cheque bearing no.000132 for Rs.2,50,000/ drawn on Karur Vysya Bank
Limited and agreed to pay the balance amount of Rs.1,00,000/ at the time of final payment. The complainant demanded the accused for payment of the amount due under the cheques but the accused postponed the same and in the meanwhile the said cheques got expired. It is further submitted that the complainant demanded the accused for payment of amount due under agreement and cheque bearing nos. 000131, 000132 then the accused issued cheque bearing no.000112, dt.01.06.2018 for Rs.3,00,000/ and another cheque bearing no.000111, dt.10.06.2018 for Rs.3,00,000/ drawn on Karur
Vysya Bank Ltd., Pragathi Nagar Branch, Hyderabad. The complainant has presented the said two cheques in her account with
HDFC Bank Ltd., Pragathi Nagar branch but the said cheques were returned on 19.06.2018 unpaid for the reasons “Funds Insufficient”.
The complainant has informed the same to the accused for which the accused requested to represent the above cheques for encashment and assured to maintain the balance to honor the cheques, accordingly, the complainant has presented the above cheques for the second time with her banker HDFC Bank Ltd., Pragathi Nagar 5 Crl.Appl. No.71 of 2023
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Branch, but the said cheques again returned on 04.07.2018 and 06.07.2018 for the reasons “Funds Insufficient”. Therefore, the complainant got issued legal notice on 18.07.2018 through registered post which was received by the accused on 23.07.2018 and got issued reply notice through her counsel on 07.08.2018 with false and frivolous averments but did not repay the cheque amount, and that the complainant is constrained to file complaint.
3.The Trial Court took cognizance for the Offence under Section 138 of the Negotiable Instruments Act against the accused and it was numbered as CC No.405 of 2021. The accused was examined
U/s.251 Cr.P.C., by the learned Magistrate, for which she pleaded not guilty and claimed to be tried.
4.Before the Trial Court, complainant, herself examined as PW1 and one witness by namely Govind Goud Vanka also examined as
PW2, and got marked Ex.P1 to P23. On behalf of the accused herself examined as DW1 and got marked Exs.D1 to D3.
5.After conclusion of the Trial and after examining the accused under section 313 Cr.P.C and on hearing both sides, the Trial court convicted the accused for the offence under Section 138 of the
Negotiable Instruments Act by sentencing her to suffer simple imprisonment for a period of 3 months and to pay Rs.6,00,000/ the 6 Crl.Appl. No.71 of 2023
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cheque amount as compensation and on payment of Rs.6,00,000/ by the accused, the same ie., Rs.6,00,000/ shall be paid to the complainant under section 357 (3) of Cr.P.C.
6.For the sake of convenience, and for better understanding the facts, the parties herein will be referred as arrayed in CC No.405 of 2021 as “complainant” and “accused”.
7.Heard the arguments of the learned counsel for the appellant/accusedandlearnedcounselforthe respondent/complainant.
8.The learned counsel for the appellant/accused by reiterating the grounds of the appeal mentioned in the appeal, argued that:
i)The trial court judgment is contrary to law, weight of evidence and probabilities of the case.
ii)The trial court judgment is based on only presumptions, surmises and conjectures which are not relevant to the circumstances of the case.
iii)That the trial court have not properly assessed the contents of the complainant, chief affidavit of the PW1 and the contents of the cross examination of PW1. Wherein, the complainant as PW1 as categorically admitted that, she had received the part sale consideration for a sum of 7 Crl.Appl. No.71 of 2023
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Rs.7,55,000/ on different dates, from the date of execution of Agreement of Sale ie., Ex.P13, which is also marked as Ex.D1, on behalf of the appellant/accused. But, the trial court without considering the said facts convicted the accused relaying upon the Ex.P1 and P2 for which the respondent/complainant is claiming that, the accused still has to pay Rs.6,00,000/. In fact, the appellant/accused astopayonlyRs.1,45,000/tothe respondent/complainant. But the complainant by inverting the real facts contended that, she had issued the above said two impugned cheques for Rs.6,00,000/ to discharge the legally enforceable debt. In fact, there isno legally enforceable debt for the respondent and as the said impugned cheques ie., the Ex.P1 and P2 was not issued to charge the alleged liability. But the trial court ignored the said facts and passed the erroneous judgment against the appellant/accused herein.
iv)That the trial court ought to have considered that, there is no legally enforceable debt and as such, the impugned cheques ie., Ex.P1 and P2 are not issued for the above said legally enforceable debt.
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v)That the PW1 admitted herself that, she has received a sum of Rs.7,55,000/ on different dates from the date of execution of the Agreement of Sale from the appellant/accused out of the total sale consideration of
Rs.9,00,000/. As such, the balance sale consideration of
Rs.1,45,000/ only to be paid by the appellant/accused as due amount. The said fact was not denied by the respondent/complainant in the cross examination. But the trial court has not appreciated the said fact and wrongly delivered the impugned judgment.
vi)The trial court failed to observe that the respondent/complainant has failed to establish the ingredients of the section for the offence U/Sec. 138 of N.I.
Act.
vii)The trial court ought to have considered that, total sale consideration of Rs.9,00,000/ only but not
Rs.10,00,000/ as pleaded by the complainant in her complaint and other depositions.
viii)The trial court has not considered the admission of the
PW1 ie., the complainant herein with regard to as to she has already received a sum of Rs.7,55,000/ from the accused.
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ix)The trial court ought to have considered the chief examination of the DW1 and the documents filed by her ie., Ex.D1 to D3.
x)The trial court ought to have considered that the above said two impugned cheques were taken from the appellant/accused towards the security purpose for getting the balance sale consideration. But unfortunately, the trial court not considered to the said facts and simple passed erroneous judgment against the appellant/accused stating that, the said two cheques given to the complainant for discharging the legally enforceable debt.
xi)The trial court ought to have not considcered the plea of the respondent/complainant with regard to receiving of an amount of Rs.2,00,000/ by the husband of accused from the complainant. In fact, the respondent/complainant never have stated such transactoin either in her complaint or in her chief affidavit, with regard to that the accused husband had taken Rs.2,00,000/ from the Complainant.
On the other hand, the PW1, ie., the complainant absolutely failed to produce any cogent evidence to substantiate her version. Moreover, the complainant also failed to prosecute the husband of accused in the above 10 Crl.Appl. No.71 of 2023
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said case to substantiate her version with regard the said amountofRs.2,00,000/paidbythe respondent/complainant to the husband of accused. In the absence of such facts, the trial court without holding any lawful application of mind simply considered that, an amountofRs.2,00,000/paidbythe respondent/complainant to the husband of accused is treated to be paid to discharge the previous debt.
9.Per contra, it is argued by the learned counsel for the respondent/complainant that the trial court has appreciated the evidence in the correct perspective and thereby held that the accused is liable for the offence under Section 138 of the Negotiable
Instruments Act. It is further contended that the trial court after considering the oral and documentary evidence on record, has drawn the statutory presumptions available under Sections 118 and 139 of the Negotiable Instruments Act and thereby convicted the accused, and hence, prayed to dismiss the appeal by confirming the conviction.
10.Upon careful examination of the material on record and the grounds urged in the appeal coupled with the contentions raised on behalf of both sides, now the points that would emerge for consideration in the present appeal are:
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1) Whether the complainant could establish the exis tence of legally enforceable debt under Ex.P1, cheque bearing no.000111, dt.10.06.2018 for Rs.3,00,000/ and P2 cheque bearing no. 000112, dt.01.06.2018 for
Rs.3,00,000/ total amount for Rs.6,00,000/?
2) Whether the cheques in question i.e., Ex.P.1, and P2 were issued by the accused towards legally enforce able debt?
3) Whether the conviction and sentence passed by the trial court in C.C.No.405 of 2021 is legally and factu ally sustainable?
4) To what relief?
11.Both parties have not adduced any further evidence.
Points No.1 and 2:
1) Whether the complainant could establish the exis tence of legally enforceable debt under Ex.P1, cheuqe bearing no.000111, dt.10.06.2018 for Rs.3,00,000/ and P2 cheque bearing no. 000112, dt.01.06.2018 for
Rs.3,00,000/ total amount for Rs.6,00,000/?
2) Whether the cheques in question i.e., Ex.P.1, and P2 were issued by the accused towards legally enforce able debt?
12.For the sake of convenience, brevity and to avoid repetitions of evidence, these points are taken up together for discussion.
13.It is the testimony of the complainant/PW1 Sarepalli Harika that she is running the business of Beauty Parlours having two branches in Bachupally area in the name of Sitara Herbal Beauty
Parlour and Harixs Herbal Beauty Parlour at Pragathi Nagar, 12 Crl.Appl. No.71 of 2023
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Kukatpally. The PW1 and the accused are neighbors, therefore, they got acquaintance with each other, having that acquaintance the accused approached the PW1 in the month of March, 2017, proposed for purchase of two beauty parlours maintained by the PW1 for which the PW1 had also agreed, accordingly, in the month of April 2017 the
PW1 and the accused have arrived to a conclusion of sale consideration as Rs.10,000,000/. It is also submitted that on 15.05.2017 the accused paid an amount of Rs.2,00,000/ to the PW1 towards advance sale consideration. The PW1 and accused have entered into an agreement of sale, dt.22.05.2017. The total sale consideration Rs.9,00,000/ was mentioned in the said agreement of sale and when the PW1 questioned the same, the accused informed that Rs.1,00,000/ will be paid at the time of final payment. The PW1 had handed over the two beauty parlour maintained by her to the accused on 01.06.2017. The accused paid Rs.2,00,000/ as part of sale consideration and for the remaining amount the accused issued a cheque bearing no.000131 for Rs.2,50,000/ and the cheque bearing no.000132 for Rs.2,50,000/ drawn on Karur Vysya Bank Limited and agreed to pay the balance amount of Rs.1,00,000/ at the time of final payment. The PW1 demanded the accused for payment of the amount due under the cheques but the accused postponed the same and in the meanwhile the said cheques got expired. It is further 13 Crl.Appl. No.71 of 2023
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submitted that the PW1 demanded the accused for payment of amount due under agreement and cheque bearing nos. 000131, 000132 then the accused issued cheque bearing no.000112, dt.01.06.2018 for Rs.3,00,000/ and another cheque bearing no.000111, dt.10.06.2018 for Rs.3,00,000/ drawn on Karur Vysya
Bank Ltd., Pragathi Nagar Branch, Hyderabad. The PW1 has presented the said two cheques in her account with HDFC Bank Ltd.,
Pragathi Nagar branch but the said cheques were returned on 19.06.2018 unpaid for the reasons “Funds Insufficient”. The PW1 has informed the same to the accused for which the accused requested to represent the above cheques for encashment and assured to maintain the balance to honor the cheques, accordingly, the PW1 has presented the above cheques for the second time with her banker HDFC Bank
Ltd., Pragathi Nagar Branch, but the said cheques again returned on 04.07.2018 and 06.07.2018 for the reasons “Funds Insufficient”.
Therefore, the complainant got issued legal notice on 18.07.2018 through registered post which was received by the accused on 23.07.2018 and got issued reply notice through her counsel on 07.08.2018 with false and frivolous averments but did not repay the cheque amount to the complainant,
14.In support of the contention of the complainant, she relied on
Exs.P.1 to P.23. Ex.P.1 is the cheque bearing no. 000111, for 14 Crl.Appl. No.71 of 2023
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Rs.3,00,000/ dated 10.06.2018, would show that it was issued by the accused for Rs.3,00,000/ in favour of the complainant to be drawn in the Karur Vysya Bank, Pragathi nagar Branch; Ex.P.2 is the cheque bearing no. 000112, for Rs.3,00,000/ dated 10.06.2018, would show that it was issued by the accused for Rs.3,00,000/ in favour of the complainant to be drawn in the Karur Vysya Bank,
Pragathinagar Branch; Ex.P3 is the cheque return memo, which is issued by the HDFC Bank Ltd., Pragathi nagar Branch, in favour of the complainant dated 19.06.2018, goes to show that Ex.P2/cheque was returned with endorsement as “Funds insufficient”; Ex.P4 is the cheque return memo, which is issued by the HDFC Bank Ltd.,
Pragathi nagar Branch, in favour of the complainant dated 04.07.2018, goes to show that Ex.P2/cheque was returned with endorsement as “Funds insufficient”; Ex.P5 is the cheque return memo, which is issued by the HDFC Bank Ltd., Pragathi nagar
Branch, in favour of the complainant dated 30.06.2018, goes to show that Ex.P1/cheque was returned with endorsement as “Funds insufficient”; Ex.P6 is the cheque return memo, which is issued by the HDFC Bank Ltd., Pragathi nagar Branch, in favour of the complainant dated 06.07.2018, goes to show that Ex.P1/cheque was returned with endorsement as “Funds insufficient”; Ex.P7 is the office copy of legal notice dated 18.07.2018 would show that complainant 15 Crl.Appl. No.71 of 2023
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got issued the legal notice by informing about dishonor of cheques and demanded the appellant / accused to arrange the cheques amount of Rs.6,00,000/ within 15 days; Ex.P8 is the Postal receipt dt.18.07.2018, would show that the complainant got issued legal notice vide Ex.P7 through registered post; Ex.P9 is the Postal receipt dt.18.07.2018, would show that the complainant got issued legal notice vide Ex.P7 through registered post; Ex.P10 is the Postal track report dt.23.07.2018, would show that the legal notice which was sent under Ex.P7 through registered post was returned as door locked;
Ex.P11 is the Postal track report dt.23.07.2018, would show that the legal notice under Ex.P5 was delivered to appellant/accused; Ex.12 is the reply notice issued by the accused, dt.07.08.2018, would show that accused denied the allegation leveled in the legal notice issued by the complainant; Ex.P13 is the Sale Agreement for Sitara and Harixs
Beauty Parlour, dt.22.05.2017, would clearly show that the complainant had sold away her two beauty parlours ie., Sitara and
Harixs beauty parlaours to the appellant/accused for a sale consideration of Rs.9,00,000/ and the accused paid an amount of
Rs.2,00,000/ on 15.05.2016 as an advance for sale consideration;
Ex.P14 is the Bank Statement of “Sitara Beauty Parlour, HDFC Bank, from 11.11.2013 to 28.02.2017, would show that financial transaction of “Sitara Beauty Parluor” for the said period; Ex.P15 is 16 Crl.Appl. No.71 of 2023
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the complaint given PS Bachupally dt.13.07.2018, goes to show that the complainant made allegation against the appellant/accused that when she went to the house of the appellant/accused by demanding to pay the cheques amount for which the appellant/accused abused her and that she requested the SHO, PS Bachupally to take action against the appellant/accused ; Ex.P16 is the compromise letter issued by accused, dt.14.07.2018 goes to show that the appellant/accused entered into agreement in the police station
Bachupally, in which accused/appellant agreed that she purchased two beauty parlours for sale consideration Rs.10,00,000/ and out of which she paid Rs.4,00,000/ as advance, and that the appellant/accused agreed to pay the remaining amount of
Rs.6,00,000/ within two months for which the complainant also agreed for the same; Ex.P17 is the postal acknowledgment, dt.25.07.2018 which shows that the Ex.P7 legal notice which was sent to the house of the appellant/accused was served to the appellant/accused by the postal authorities through registered post;
Ex.P18 is the postal return cover, dt.03.08.2018 which shows that the
Ex.P7 legal notice, which was sent to the shop of the appellant/accused, got returned by the postal authorities as unclaimed; Ex.P19 is the trade license dt.04.09.2013, issued by the
Grama Panchayath, Pragathinagar, which shows that the 17 Crl.Appl. No.71 of 2023
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complainant got trade license in the name of “Sitar beuaty Parlour” which was valid from 18.07.2013 to 31.03.2014; Ex.P20 is the business license receipt, dt.21.07.2014, would show that the complainant got renewed the business license from 01.04.2014 to 31.03.2015 for running “Sitara bueaty parlour”; Ex.P21 is the business license receipt, dt.15.10.2015 would show that the complainant got renewed the business license from 16.10.2015 to 31.03.2016 for running “Harixs beauty parlour”; Ex.P22 is the receipt of Gramapanchayath, Pragathi Nagar, dt.21.07.2014 would show that the complainant paid license fee of Rs.1100/ for running “Sitara beauty parlour; Ex.P23 is the bank statement of Harxis beauty
Parlour, SBI at Pragathi Nagar, Kukatpally, would show that an amount of Rs.50,000/ was debited on 09.03.2017, and credited into account of the accused, and amount of Rs.50,000/ was debited on 09.03.2017 and credited into the account of husband of the accused namely Pranay Raju, and amount of Rs.50,000/ was debited on 13.03.2017 and credited into the account of accused/appellant and an amount of Rs.50,000/ was debited on 13.03.2017 and credited into account of husband of the accused, and also an amount of
Rs.12004.60/ was debited on 04.04.2017 and credited into the account of husband of the accused namely Pranay Raj.
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15.During the crossexamination of PW.1, she denied the suggestion of the accused that the accused agreed to purchase the two beauty parlours for Rs.9,00,000/ for not Rs.10,00,000/. PW1 admitted that she received Rs.2,00,000/ on 15.05.2016 and another
Rs.2,00,000/ on 22.05.2017. She further admitted that she received
Rs.1,30,000/ on 03.06.2017 in the joint account of PW1 and her mother from the accused, but she again testified that the amount is different amount due by the accused. PW1 denied the suggestion of the accused that she received total amount of Rs.7,55,000/ from the accused towards sale consideration and that PW1 is entitled to
Rs.1,45,000/ from the accused. PW1 denied the suggestion of the accused that she obtained Ex.P16/compromise letter forcibly in the police station.
16.The complainant also examined the PW2/Govind Goud Vanka, who is the family friend of the PW1, his testimony is that the complainant is his family friend. That the complainant established busines outlets of Beauty Parlours ie., 1) Sitaa Herbal Beauty Parlour and 2) Harixs Herbal Beauty Parlour at Pragathinagar, Kukatpally,
Hyderabad. He know the accused, she is also running same business on the name of M/s. Bliss Beauty Parlour and Boutique at
Pragathinagar, Kukatpally, Hyderabad. In the month of April 2017 the 19 Crl.Appl. No.71 of 2023
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complainant informed him to visit her work place stating that some business talks going on between the complainant and accused, accordingly he reached the work place of the complainant, wherein the accused herein fixed the sale consideration of two beauty parlours for an amount of Rs.10,00,000/. That on 01.06.2017 the accused issued two cheques each for Rs.2,50,000/ and promised to honour the said cheques on its presentation. Thereafter, he came to know that the accused failed to pay the cheques amounts, after expiry of cheques, the accused again issue two cheques each for Rs.3,00,000/ towards full and final settlement in his presence and entire transaction took place before him. Thereafter, recently he came to know that the accused failed to honour the said cheques and the complainant herein issued legal notice to the accused and filed this case against the accused.
17.During the crossexamination of PW.2, he denied the suggestion of the accused that the sale consideration is only Rs.9,00,000/ but not Rs.10,00,000/. He also denied the suggestion of the accused that the accused already paid Rs.7,45,000/ to the PW1.
18. On the other hand, accused/A. Anusha herself examined as DW1 and testified in her evidence that she purchased two beauty parlours from the complainant under agreement Ex.D1, for consideratoin for 20 Crl.Appl. No.71 of 2023
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Rs.9,00,000/ for two beauty parlours. She never agreed to pay
Rs.1,00,000/ more to PW1 orally. She paid Rs.4,00,000/ at the time of agreement thereafter, Rs.3,50,000/ within one month and she handed over keys to her. Except Rs.2,00,000/ cash at the time of agreement the remaining amount Rs.5,50,000/ was on bank account transfer. She has to pay Rs.1,45,000/ to the complainant. There is delay to pay the balance amount she asked the complainant for some time then PW1 obtained forcibly signed two blank cheques from her.
PW1 promised to return the above blank cheques after payment of
Rs.1,45,000/ from her they are are given for security purpose. Ex.P1 and Ex.P2 cheques contents are not filed up by her. She need not pay
Rs.6,00,000/ to PW1. On 04.08.2018 PW1 executed agreement in her favour under Ex.D3 admitting that there was no other transaction except parlour transaction by her to the PW1. Ex.P23 transaction is nothing to do with this beauty parlour transaction. She repaid the amount receive3d under Ex.P23 and there is also bank statement with her. She does not know other payments in favour of her husband in
Ex.P23 till PW1 deposes in this court. In the police station PW1 and her men obtained her signatures in Ex.P15 document without disclosing contents and she did not execute Ex.P15 voluntarily. Now she was not running beauty parlour she dismantle as there were some rumors on the said beauty parlours. She saw the PW2 in the police 21 Crl.Appl. No.71 of 2023
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station PW2 is a person who threaten public to recover the amounts.
She was ready to pay Rs.1,45,000/.
19. The accused/appellant relied upon the Ex.D1 to D3. Ex.D1 is the
Sale Agreement for Sitara and Harixs Beauty Parlour, dt.22.05.2017, would clearly show that the complainant had sole away the her two beauty parlours ie., Sitara and Harixs beauty parlaours to the appellant/accused for a sale consideration of Rs.9,00,000/ and the accused paid an amount of Rs.2,00,000/ on 15.05.2016 as an advance for sale consideration; Ex.D2 is the bank statement of appellant/accused period from 15.05.2017 to 14.06.2017, and 15.07.2017 to 14.08.2017, would show that an amount of
Rs.2,00,000/ was debited on 15.05.2017 and credited into account of
S. Laxmi, an amount of Rs.2,00,000/ was debited on 01.06.2017 and credited into account of S. Laxmi, an amount of Rs.1,30,000/ was debited on 03.06.2017 and credited into account of S. Laxmi and an amount of Rs.25,000/ was debited on 31.07.2017 and credited into the account of S. Laxmi. Ex.D3 is the agreement executed by complainant in favour of the accused/appellant, where in complainant agreed that except the agreement of beauty parlour dt.22.05.2017, the accused has not executed any other document and complainant is no way concern about the finance transaction between her junior paternal aunt/Rajeshwary and accused.
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20.During the crossexamination of DW1, she admitted that in
Ex.P13 agreement it is not mentioned that she gave blank signed cheques to the complainant. She further admitted that she did not give blank signed cheques to the PW1 in the police station. She further admitted that Ex.P13 agreement contains her signature and signature of the complainant. She further admitted that Ex.P1 and P2 cheques pertain to her. DW1 also further admitted Ex.P16 was executed between her and complainant. DW1 also admitted that Ex.P1 and
P2/cheques are issued by her. She also further admitted she has not got mentioned in reply notice that Ex.P1 and P2/cheques were issued for the purpose other transaction.
21.Now it has to be seen what is the probable defence of the accused to create doubt on the alleged subsisting legal debt set up by the complainant and that whether any material facts are elicited by the accused in the evidence of PW1 and the same casts doubt on the credibility of such evidence to believe that Ex.P1,P2/ cheques was not issued towards the discharge of any subsisting debt under
Ex.P13/Sale Agreement dt.22.05.2017.
22.At this stage, it is relevant to mention the provisions of Law under Section 138 and 139 of the Negotiable Instruments Act, 1881:
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Section 138 of the Negotiable Instruments Act:
138: Dishonour of cheque for insufficiency etc., of funds in the
account –Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that 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 that bank, such person shall be deemed to have committed an offence and shall without prejudice to any other provisions of this Act, be punished with imprisonment for (a term which may be extended to two years), or with fine which may extend to twice the amount of the cheque, or with both: Provided that nothing contained in this section shall apply unless—
1. the 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;
2. the payee or the holder in due course of the cheque, as the case may be, 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 thirty days) of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
3. the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.
139: Presumption in favour of holder : It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability.
23.It is also relevant to mention the Provision of Law under Section 118 of the Negotiable Instruments Act, 1881:
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118: Presumption as to negotiable instruments :
Until the contrary is proved, the following presumptions shall be made:
1) of consideration – that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration;
2) as to date—that every negotiable instrument bearing a date was made or drawn on such date;
3) as to time of acceptance – that every accepted bill of exchange was accepted within a reasonable time after its date and before its maturity;
4) as to time of transfer—that every transfer of a negotiable instrument was made before its maturity;
5) as to order of indorsements—that the indorsements appearing upon a negotiable instrument were made in the order in which they appear thereon;
6) as to stamps—that a lost promissory note, bill of exchange or cheque was duly stamped;
7) that holder is a holder in due course – that the holder of a negotiable instrument is a holder in due course.
Provided that, where the instrument has been obtained from its lawful owner, or from any person in lawful custody thereof, by means of an offence or fraud, or has been obtained from the maker or acceptor thereof by means of an offence or fraud, or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him.
24.In the present case on hand, so far as the question of existence of basic ingredients for drawing of presumption U/secs.118 and 139 of the NI Act is concerned, apparent it is that the appellant / accused did not deny his signatures on the cheques in question that had been drawn in favour of the complainant on a bank account maintained by the accused for a sum of Rs.6,00,000/. As can be seen from the evidence of PW.1 and PW2 coupled with the documentary evidence 25 Crl.Appl. No.71 of 2023
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under Exs.P.1 to P.23, which clearly establishes that the accused had issued Cheques under Ex.P.1 for Rs.3,00,000/ and Ex.P2 for
Rs.3,00,000/ in favour of the PW.1 towards the discharge of the loan amount under Ex.P.13/Sale Agreement for Sitara & Harixs Beauty
Parlour, dt.22.05.2017, and subsequently the both cheques were returned by the Bank with an endorsement as “Funds Insufficient” and in spite of sending legal notice, the accused failed to pay the cheques amount.
25.The learned counsel for the accused argued that the accused executed the Sale Agreement dt.22.05.2017 under Ex.P13 for sale consideration of Rs.9,00,000/ for purchase of two beauty parlours ie., Sitara and Harxis beauty parlours, and never issued the cheque under Ex.P1 and P2 towards discharge of payment of remaining sale consideration of Rs.6,00,000/ under Ex.P13, and there was no legal enforceable debt between them. It is also submitted that the accused/appellant is liable to pay only an amount of Rs.1,45,000/ out of Rs.9,00,000/ and the complainant forcibly obtained her signatures on two blank cheques as security purpose and promised to return the same after payment of remaining balance of sale consideration of Rs.1,45,000/.
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26.Per contra, the learned counsel for the complainant submitted that the accused has not disputed her signatures on the cheques under Ex.P1 and P2 and Ex.P13/Sale Agreement dt.22.05.2017 and that the presumptions U/s.118 and 139 of N.I. Act can be drawn.
27.Admittedly, the accused has not disputed the signatures on the
Sale Agreement dt.22.05.2017 under Ex.P13 and cheque under Ex.P1 and P2. It was also not suggested during the cross examination of
PW1 that the signatures on the sale agreement and cheques were not belonging to her. It was also not suggested to PW1, that cheques under Ex.P1 and P2 were not pertaining to her bank account. The accused also did not explain any reasons as to how the cheques under Ex.P1 and P2 was in the custody of complainant, and in that regard there is no whisper in the cross examination of PW1. On the other hand, the evidence of PW1 is corroborated by the evidence of
PW2 who is the family friend of PW1 and eyewitness to the Sale
Agreement dt.22.05.2017 under Ex.P13 and also coupled with the documentary evidence under Ex.P1 and P2/Cheques and
Ex.P13/Sale Agreement which are cleary establishing that accused had purchased Sitara and Harixs Beauty Parlour from PW1 on 22.05.2017 and executed Sale Agreement for Sitara & Harixs Beauty
Parlour, dt.22.05.2017 for Rs.9,00,000/ under Ex.P13, and also issued cheques under Ex.P1 and P2 towards discharge of due amount 27 Crl.Appl. No.71 of 2023
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of sale agreement under Ex.P13. Admittedly, accused did not dispute the signatures on the cheques under Ex.P1 and P2.
28. The learned counsel for the appellant contended that there is no legal enforceable debt on cheques Ex.P1 and P2 are obtained by the complainant in the police station and misused the same and filing the present case, and the accused is liable to pay an amount of
Rs.1,45,000/ to the complainant out of Rs.9,00,000/.
29. Per contra, the learned counsel for the respondent contended that the appellant/accused agreed to purchased two beauty parlours for Rs.10,00,000/, though the sale agreement was executed for
Rs.9,00,000/ and later accused paid only Rs.4,00,000/ and failed to pay the balance amount of Rs.6,00,000/ and that she issued cheques under Ex.P1 and P2 towards payment of Rs.6,00,000/ and the same was also admitted by the appellant/accused and executed a compromise letter under Ex.P16.
30. Admittedly, accused/appellant has not disputed the sale agreement under Ex.P13. Appellant/accused also admitted that she issued cheques under Ex.P1 and P2 for Rs.6,00,000/. Though it is evidence of the appellant/accused/DW1 that the complainant forcibly obtained her signatures on the blank cheques from her, but there is no whisper in the reply legal notice issued by the appellant/accused 28 Crl.Appl. No.71 of 2023
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under Ex.P12, stating that complainant had obtained the signatures of the appellant/accused forcibly on the blank cheques of the accused. On the other hand, it is mentioned in the reply legal notice that she had issued the two blank signed cheques towards security purpose. Moreover, the appellant/accused/DW1 categorically admitted in the cross examination that Ex.P16/compromise letter was executed between the complainant and accused. Therefore, it clearly goes to show that the appellant/accused admitted about the execution of compromise letter under Ex.P16. On perusal of the
Ex.P16/compromise letter, dt. 14.07.2018, would clearly show that appellant/accused admitted that she purchased the “Sitara beauty parlour and Harxis beauty parlour” in the year 2017, for sale consideration of Rs.10,00,000/ and she gave Rs.4,00,000/ as on advance, and she is liability to pay the remaining sale consideration of
Rs.6,00,000/ for which she promised to pay remaining sale consideration of Rs.6,00,000/ within two months. But, the appellant/accused did not explain any reasons as to what made her to execute the compromise letter under Ex.P16 dt.14.07.2018 by seeking two months time to pay the remaining sale consideration of
Rs.6,00,000/ out of Rs.10,00,000/ towards purchase of “Sitara beuaty parlour and Harxis beauty parlour”. If really appellant/ accused paid an amount of Rs.7,55,000/ out of Rs.9,00,000/ for 29 Crl.Appl. No.71 of 2023
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purchase of said beauty parlours and liability to pay remaining sale consideration of Rs.1,45,000/ as contended by the appellant/accused, then, what made her to execute the compromise letter under Ex.P16 by seeking two months time to pay remaining sale consideration of Rs.6,00,000/ out of Rs.10,00,000/ towards purchase of Sitara and Harxis beauty parlours, has not been explained. Moreover, there is no whisper in the reply legal notice about the compromise letter under Ex.P16. If at all the complainant obtained the compromise letter under Ex.P16 by forcibly in the police station as contended by appellant/accused, then she would have got mentioned the same in the reply legal notice under Ex.P12 issued by the appellant/accused. It shows that the evidence of PW1 coupled with the documentary evidence under Ex.P13 and P16 which are admitted by the appellant/accused would clearly establish that appellant/accused purchase the two beauty parlors ie., Sitara and
Harxis beauty parlours for sale consideration of Rs.10,00,000/ and accused paid an amount of Rs.4,00,000/ as an advance of the sale consideration and later accused/appellant failed to pay the remaining sale consideration of Rs.6,00,000/, and that she issued cheques under Ex.P1 and P2 towards payment of remaining sale consideration of Rs.6,00,000/.
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31.Therefore, from the evidence of PW1 and PW2, coupled with the documentary evidence under Exs.P.1 to P23, it is very clear that the signatures on Ex.P1 and P2 are pertaining to the accused, which is not in dispute. Since, the accused did not dispute her signatures on the cheques / under Ex.P1 and P2, as such the burden shifts upon the accused to rebut the presumption available to PW.1 under Section 139 of the Negotiable Instruments Act and passing of consideration under Section 118 of the Negotiable Instruments Act. As per the
Section 139 of the Negotiable Instruments Act, the presumption can be drawn in favour of the complainant/PW.1 if it is proved that the cheques in question contains the signatures of the drawer i.e., the accused. There is no dispute with regarding to the signatures of the accused on the Cheques under Ex.P1 and P2, then it can be held that the cheques in question was issued by her towards legally enforceable debt covered under Ex.P13 and Ex.P16. As per the Section 118 of the
Negotiable Instruments Act, it can be presumed that the consideration was passed under Ex.P1 and P2 and it is for the accused to rebut the presumption. But, the accused utterly failed to rebut the presumption under Section 118 of the Negotiable Instruments Act and Section 139 of the Negotiable Instruments Act. Hence, under these circumstances, this court has no hesitation to hold that the complainant/PW.1 has proved his case against the accused, and established the fact that 31 Crl.Appl. No.71 of 2023
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there exists legally enforceable debt under Ex.P13/ Sale Agreeement for Sitara & Harixs Beauty Parlour dt. 22.05.2017 and
Ex.P16/compromise letter, dt.14.07.2018 in between PW.1 and the accused, and the Ex.P1 and P2/cheques were issued by the accused in discharge of the legally enforceable debt and said cheques dishonoured. Accordingly, these points are answered in favour of the respondent/complainant and as against the appellant/accused.
Point No.3:
Whether the conviction and sentence passed by the trial
court in C.C.No.405 of 2021 is legally and factually sustainable?
32.In view of the above discussion held in Points No.1 and 2, it can be held that the trial court after appreciating the evidence of Pw.1 coupled with Exs.P.1 to P23 in proper perspective, had come to the conclusion that the accused issued cheques under Ex.P1 and P2 towards discharge of due amount under Ex.P13/Sale Agreement for
Sitara and Harixs Beauty Parlour and Ex.P16/compromise letter, dt.14.07.2018 and that statutory legal notice was served on the accused with correct address and thereby the complainant/PW.1 has proved the guilt of the accused for the offence under Section 138 of the Negotiable Instruments Act and the trial court had rightly convicted the appellant/accused by sentencing her to undergo Simple
Imprisonment for Three Months, and to pay a sum of Rs.6,00,000/ 32 Crl.Appl. No.71 of 2023
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the cheque amount as compensation and on payment of
Rs.6,00,000/ by the accused, the same ie., Rs.6,00,000/ shall be paid to the complainant under Section 357 (3) of Cr.P.C. The same appears to be quite reasonable and needs no interference by this appellate Court. Therefore, it is held that the conviction and sentence passed by the Trial Court in CC No.405 of 2021 is legally and factually sustainable. Accordingly, this point is answered in favour of the respondent/complainant and as against the appellant/accused.
Point No.4:
To what relief?
33.In the result, this Criminal Appeal is dismissed by confirming the judgment of the conviction and sentence passed by the XI Special
Magistrate Court, MedchalMalkajgiri District at Kukatpally in CC
No.405 of 2021, dated: 20.07.2023 for the offence punishable U/Sec.
138 of Negotiable Instrument Act and she is convicted of the same
U/Sec. 255 (2) Cr.P.C., and she is sentenced to undergo Simple
Imprisonment for Three Months, and to pay a sum of Rs.6,00,000/ the cheque amount as compensation and on payment of
Rs.6,00,000/ by the accused, the same ie., Rs.6,00,000/ shall be paid to the complainant under Section 357 (3) of Cr.P.C. The appellant/accused is called absent. The Prl. Junior Civil JudgeCum
XI Additional Metropolitan Magistrate, MedchalMalkajgiri District at 33 Crl.Appl. No.71 of 2023
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Kukatpally is directed to secure the presence of the accused by issuing warrant to send her to undergo sentence.
Typed to my dictation to the Stenographer, Gr.II, typed by him, corrected and
pronounced by me in the open Court on this the 21 th day of May, 2025.
III Addl. Dist. & Sessions JudgeCum Prl. Family Court Judge, Medchal Malkajgiri District at Kukatpally
APPENDIX OF EVIDENCE
NIL
III Addl. Dist. & Sessions JudgeCum Prl. Family Court Judge, Medchal Malkajgiri District at Kukatpally