C.C.No.421 of 2023 1 V ACJM, VJA
IN THE COURT OF THE V ADDL. CHIEF JUDICIAL MAGISTRATE :
VIJAYAWADA
Present: Sri.C. Ramana Reddy,
V Addl. Chief Judicial Magistrate, Vijayawada
Monday, this the 13 th day of April, 2026
C.C.No.421/2023 (Old C.C.No.781/2020)
Between:
Kapavarapu Srinivasa Rao, S/o. Nancharaiah, Hindu, aged about 52 years, R/o. D.No.19-74, Ramachandra Nagar, Kanuru, Penamaluru Mandal, Krishna District,
Andhra Pradesh – 520007. ... Complainant
And
Nidumolu Nagarjuna Kumar, S/o. Late N.V.S.V.Pradada Rao, Hindu, aged 35 years, R/o. D.No.13-100, Beside Ashok Locks, Penamaluru Village & Mandal, Krishna District, A.P. - 520007.
Present Address: D.No.20/516-2B-6, NGOS Colony, Parasupet, Machilipatnam, Krishna District, A.P.
... Accused
This case come up before me for final hearing on 07.04.02026 in the presence of Sri P.Narasa Reddy, learned Advocate for Complainant and Sri P.Niranjan Rao, learned Advocate for Accused and upon perusing the material on record and upon having stood over for consideration till this day, the Court delivered the following:
J U D G M E N T
1.
This complaint is filed by the complainant against the accused
U/s.138 r/w 142 of Negotiable Instruments Act to punish the accused according to law and to award compensation U/s.357 Cr.P.C from out of the fine amount.
C.C.No.421 of 2023 2 V ACJM, VJA 2.The brief facts of the case of complainant are as follows:
(i) The complainant submitted that the accused borrowed an amount of Rs.10,00,000/- from the complainant on 01.08.2017 for his family and business purposes and executed a promissory note in favour of the complainant agreeing to repay the same with interest @ 12% p.a. either to the complainant or his order on demand.
(ii)The complainant further submitted that on repeated demands made by the complainant, the accused has issued a cheque bearing
No.029885 for Rs.10,00,000/- dated 30.08.2019 drawn on Axis Bank Ltd.,
Machilipatnam Branch, in favour of the complainant towards the part payment of the above promissory note debt.
(iii)The complainant further submitted that the complainant presented the said Cheque through his banker i.e., State Bank of India, Patamata
Branch, Vijayawada for collection, the said cheque was returned with an endorsement “ACCOUNT BLOCKED SITUATION COVERED IN 2125” vide memo dt.31.08.2019.
(iv)The complainant further submitted that he got issued legal demand notice dated 05.09.2019 calling upon the accused to pay the said cheque amount within 15 days from the date of receipt of the notice, but the accused has managed the postal authorities and got returned the notice with false endorsement “No such door number in his village” on 07.09.2019. Thereafter the complainant made an enquiry about the address of the accused, traced out the address of the accused and again sent notice on 24.09.2019 to the present address of the accused. The accused managed the postal authorities and got returned the said notice also with an endorsement that “addressee not in town 7 days passed, hence returned to sender” on 01.10.2019, which was received by the complainant on 04.10.2019. Thus the accused is liable to pay the cheque amount to the complainant.
C.C.No.421 of 2023 3 V ACJM, VJA
(v)The complainant further submitted that the accused has issued the cheque in favour of the complainant and subsequent to that the accused closed his bank account with an ulterior motive with an intention to deceive the complainant, thus the accused has committed an offence punishable U/s.138 of
Negotiable Instruments Act. Hence, this complaint.
3. The complainant filed his sworn affidavit which was treated as sworn statement of the complainant. On perusal of the complainant and other material on record, cognizance of the offence punishable under Section 138
Negotiable Instruments Act was taken by the learned IV Addl. Chief
Metropolitan Magistrate, Vijayawada and numbered as C.C.No.781/2020.
Later as per the orders of the Hon’ble Principal District Judge, Krishna at
Machilipatnam vide Dis.No.9123 dated 14.12.2022, this complaint was transferred to this Court from the learned IV Addl. Chief Metropolitan
Magistrate, Vijayawada and re-numbered as CC.No.421/2023.
4.On appearance of the accused, copies of documents were furnished to the accused as contemplated Under Section 207 of Code of
Criminal Procedure.
5.The accused was examined Under Section 251 of Code of
Criminal Procedure, and the substance of accusation for the offence punishable under Section 138 of Negotiable Instruments Act, leveled against the accused was read over and explained to him in Telugu, for which the accused denied, pleaded not guilty and claimed to be tried.
6.In order to prove the case of the complainant, the complainant himself examined as PW.1 and got marked Ex.P1 to P10. One third party by name V. Vijaya Raju, who is one of the attestor of Ex.P1 promissory note was examined as PW.2.
7.After closure of the evidence of complainant, the accused was examined Under Section 313 Cr.P.C by explaining the incriminating evidence
C.C.No.421 of 2023 4 V ACJM, VJA available against the accused on record. The accused having understood the same denied the same and reported that he has defense evidence. On behalf of the accused, the accused himself examined as DW.1, and got marked Exs.D1 to D19. One third party by name Nidumolu Bhavani, who is wife of the accused was examined as DW.2. During cross-examination of
DW.1, Ex.P11 and Ex.P12 were marked on behalf of the complainant.
8.Heard the learned counsel for the complainant and accused. The learned counsel for the accused also filed written arguments.
9.Now the point for consideration is
“Whether the complainant has proved the guilt of the accused for
the offence punishable under Section 138 of Negotiable Instruments Act
beyond all reasonable doubts”?
POINT:
10. It is the case of the complainant that the accused borrowed an amount of Rs.10,00,000/- from him for his family and business purpose and executed promissory note agreeing to repay the same with interest @ 12% per annum under Ex.P1 and to discharge the said debt, the accused issued a cheque for Rs.10,00,000/- in favour of the complainant under Ex.P2 and the same was dishonored under Ex.P3, so, the complainant got issued Ex.P4 and
P7 legal notices to the accused, which were returned unserved under Ex.P6 and P9 respectively, hence the complainant has filed this complaint against the accused.
11.On the other hand, the defence of the accused in the cross examination of Pws.1 and 2 and also during the evidence of DW.1 and 2 is that the accused has not borrowed Rs.10,00,000/- from the complainant under
Ex.P1 and the accused has not issued Ex.P2 cheque for discharge the alleged debt under Ex.P1 and that Ex.P1 and P2 were given to one Kumari towards security of chit fund transaction and that the son in law of the
C.C.No.421 of 2023 5 V ACJM, VJA complainant collected Ex.P1 promissory note and Ex.P2 cheque from said
Kumari and got filled in the name of the complainant and filed this present case. It is further defense of the accused that the complainant is white ration card holder and he has no financial capacity to lend such huge amount of
Rs.10,00,000/-. The other defence of the accused is that the complainant has not given Ex.P4 and P7 notices to the correct addresses of accused and that those were returned unserved, so, the complainant failed to comply the mandatory notice U/s.138(b) of N.I. Act.
12.To prove his case, the complainant himself examined as P.W1 and got marked Exs.P1 to P10, and deposed by reiterating the averments of complaint. PW2, deposed by corroborating the evidence of PW.1 on all material aspects as to Ex.P1. Ex.P1 is the Promissory note executed by the accused in favour of the complainant for Rs.10,00,000/- dated 01.08.2017,
Ex.P2 is the Cheque bearing No.029885 for Rs.10,00,000/- drawn on Axis
Bank, Machilipatnam in favour of complainant dated 30.08.2019, Ex.P3 is
Cheque return memo dated 31.08.2019, Ex.P4 is the Office copy of the legal notice dated 05.09.2019, Ex.P5 isPostal receipt dated 05.09.2019, Ex.P6 is the Unserved return registered cover dated 07.09.2019, Ex.P7 is the Office copy of the legal notice dated 24.09.2019, Ex.P8 is the Postal receipt dated 24.09.2019, Ex.P9 is the Unserved return postal cover dated 01.10.2019 and
Ex.P10 is the Statement of account from SBI dated 01.08.2023 for the period 01.07.2017 to 01.08.2017. On the other hand, on behalf of the accused, the accused himself examined as DW.1 and got marked Exs.D1 to D19 were marked. Ex.D1 is the Original Aadhar Card, Ex.D2 is the Certified copy of
Regd. Sale deed dated 19.06.2017 executed by Smt.M.Ammaji in favour of
Sri Kallepalli Bala Subrahmanyam, Ex.D3 is the Online copy of statement of account of the accused account bearing No.915010043198807 of Axis Bank
Ltd., Machilipatnam for the period from 01.04.2017 to 30.04.2017, Ex.D4 is the Office copy of notice dated 31.03.2018 issued by the accused to
Smt.Kallepalli Venkata Lakshmi, Ex.D5 is the Office copy of notice dated
C.C.No.421 of 2023 6 V ACJM, VJA 19.04.2018 issued by the accused to the Registrar of firms, Machilipatnam,
Ex.D6 is the Acknowledgment of Registration of firm dated 04.08.2015,
Ex.D7 is the Original Deed of partnership dated 04.08.2015, Ex.D8 is the
Original agreement of sale dated 10.03.2016 executed by U.Durga Venkata
Aravind in his favour, Ex.D9 is the Original agreement of sale dated 13.10.2016 executed by M.Ammaji in his favour, Ex.D10 is the Record slip of cheque book account bearing No.915010043198807 of Axis Bank Limited,
Ex.D11 is the Certified copy of FIR in Crime No.184/2018 of Penamaluru P.S.,
Ex.D12 is the Certified copy of Charge sheet in CC.No.328/2018 on the file of
VI Addl. Judicial Magistrate of First Class, Vijayawada, Ex.D13 is the Certified copy of rice card number 2806139247 of complainant dated 01.12.2025 issued by Office of Commissioner, Civil Supplies, Vijayawada (Marked subject to objection as to admissibility) and Ex.D14 is the Residence certificate dated 04.12.2025 issued by Tahsildar, Vijayawada East (Marked Subject to objection as to admissibility). Ex.D15 is the Ration Card/Rice card stands in the name of Kapavarapu Rama Lakshmi and Kapavarapu Srinivasa Rao issued by Asst. Supply Officer, Vijayawada dated 22.12.2025 along with covering letter dated 20.12.2025 under Right to Information Act, given to
B.Bhavya (Marked subject to objection as to admissibility), Ex.D16 is the
Certified copy of Death Certificate of Nidumolu Venkata Subrahmanya Vara
Prasada Rao, dated 05.12.2018, Ex.D17 is the Endorsement dated 15.12.2025 issued by Public Information Officer and Revenue Officer,
Tadigadapa Municipality to B.Bhavyasri (Marked subject to objection as to admissibility), Ex.D18 is the office copy of the legal notice dated 02.12.2025 got issued by the accused to one Appikatla Kumari and Ex.D19 is the Postal
Tracking report dated 05.12.2025 (Marked subject to objection as to admissibility). During cross-examination of DW.1, Ex.P11 and Ex.P12 were marked. Ex.P11 is the Bail petition filed by the accused U/s.437 Cr.P.C. in
Crl.M.P.No.1355/2023 in CC.No.421/2023 on the file of this Court and Ex.P12
is the Copy of Aadhar Card of wife of the accused. The wife of DW.1 was
C.C.No.421 of 2023 7 V ACJM, VJA examined as DW.2 and deposed by corroborating the evidence of Dw.1 on all the material aspects.
13.In the back drop of above said rival contentions, this Court has given anxious consideration to the material on record and the submissions made by both the counsels. At the out set, it is pertinent to mention that even as per the defence of the accused his empty signed promissory note and empty signed cheque, which said to have given to Appikatla Kumari towards security of chit transaction were obtained by the son in law of the complainant and misused the same. During cross-examination Dw.1 admitted his signatures on Ex.P1 and P2. Since, the accused has admitted his signatures on Ex.P1 promissory note and Ex.P2 cheque, the presumptions envisaged
Under Sections 118 and 139 of Negotiable Instruments Act would operate in favour of the complainant. It is pertinent to refer the following decisions reported in;
I. 2024 (1) ALD (Crl.) 1SC between Rajesh Jain Vs. Ajay Jain wherein para No.36 it was held that;
36. The Court will necessarily presume that the cheque had been issued towards discharge of a legally enforceable debt/liability in two circumstances. Firstly, when the drawer of the cheque admits issuance/execution of the cheque and secondly, in the event where the complainant proves that cheque was issued/executed in his favour by the drawer. The circumstances set out above from the fact(s) which bring about the activation of the presumptive clause.
II.The Hon’ble Supreme Court in M/S Kalamani Tex and another V/s P.
Balasubramanian (2021) 5 SCC 283 has held that; “Statute mandates that once the signature(s) of an accused on the cheque/negotiable instrument are established, then these 'reverse onus' clauses become operative, such a situation, the obligation shifts upon the accused to discharge the presumption imposed upon him”.
14. Therefore, once the drawer has admitted the cheque and also the signature present on the cheque, then the presumptions envisaged under section 118 (a) and 139 of NI Act, would operate in favour of the complainant.
The said provisions lays down a special rule of evidence applicable to
C.C.No.421 of 2023 8 V ACJM, VJA
Negotiable Instrument. The presumption is one of law and there under Court shall presume that the Negotiable Instrument was endorsed for consideration.
So, also in the absence of contrary evidence on behalf of the accused, the presumptions under Section 118 (a) and 139 of NI Act goes in favour of the complainant. In the present case also as the accused has admitted his signature found on Ex.P1 promissory note and Ex.P2 cheque, presumptions under section 118 (a) and 139 of NI Act have to be drawn in favour of the complainants. It is pertinent to refer Section 118 (a) and 139 of NI Act, which reads as fallows:
Sec. 118: Presumptions as to negotiable instruments of consideration:- Until the contrary is proved, the following presumptions shall be made-
(a) that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, endorsed, negotiated or transferred was accepted, endorsed, negotiated or transferred for consideration. Sec. 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, or any debt or other liability."
A combined reading of above said provisions raises a presumption in favour of the holder of the cheque that he has received the same for discharge in whole or in part of any debt or other liability.
15.The said statutory presumptions are rebuttable in nature, so it is
for the accused to place cogent and probable defence to rebut the
presumptions raised in favour of the complainant. To put it other way the burden lies upon the accused to prove that he handed over empty signed promissory note and cheque to Appikatla Kumari towards security of chit transaction and the same are misused by Kallepalli Bala Subrahmanyam, who is the son in law of complainant and got filed this complaint against the accused for wrongful gain in view of grudges between him and the accused.
16.In order to rebut the presumptions the accused has cross examined Pws.1 and 2 at length and also the accused himself examined as
Dw.1 and his wife was examined as DW.2 and deposed by reiterating the
C.C.No.421 of 2023 9 V ACJM, VJA defence fo the accused. DW.1 deposed that one Kallepalli Venkata Lakshmi, who is the mother of kallepalli Bala Subramanayam, who is the son in law of complainant is one of the partner along with him in Ekalinga Enterprises,
Machilipatnam, which was registered under Ex.D7 and the said Kallepalli Bala
Subramanyam is his close friend since his college days so, Kallepalli Venkata lakshmi is only the name-sake partner and she has not invested in the firm as she is an illiterate and that he has invested the total amount and he was looking after the business of Ekalinga Enterprises. Dw.1 further deposed that through said Kallepalli Venkat Lakshmi, he became the member of private chits, which were being maintained by one Appikatla Kumari of Machilipatnam from 2011 to 2017 and he used to send monthly chit installments amounts to said Appikatla Kumari through Kallepalli Venkata Lakshmi and Kallepalli Bala
Subrahmanyam. DW.1 also deposed that in the month of February, 2017 he has given one empty signed promissory note and one empty signed cheque i.e. cheque bearing No.029885 to said Appikatla Kumari towards security of chit amount. DW.1 further deposed that said Bala Subrahmanyam got filed this complaint through the complainant, who is his father in law by misusing the empty signed cheque and promissory note which were given by him to
Appikatla Kumari in the chit transaction. DW.2 deposed that her husband has not executed promissory note in favour of the complainant and that her husband has not issued any cheque to the complainant to discharge of any debt. Dw.2 further deposed that her husband handed over his empty signed promissory note and empty signed cheque to Kumari of Machilipatnam in relation to chit transaction and the mother of Kallepalli Bala Subrahmanyam has taken the empty signed promissory note and cheque of her husband from said Kumari and handed over the same to her son, who misused the same and got filed this complaint.
17.During cross-examination, PW.1 deposed that he does not know who is Kumari and whether said Kumari and mother of his son in law are friends or not. PW.1 denied the suggestion that Ex.P1 promissory note and
C.C.No.421 of 2023 10 V ACJM, VJA
Ex.P2 cheque were given to one Kumari towards security of chit transaction.
PW.1 also denied the suggestion that his son in law bore grudge against the accused and he collected the promissory note and cheque from said Kumari, got filled in his name, brought the same into existence and got filed the present case to get wrongful gain. During cross-examination, DW.1 denied the suggestion that there is no documentary proof to show that he has given empty signed promissory note and empty signed cheque to Appikatla Kumari in the chit transaction towards security. Dw.1 deposed that he has not issued any legal notice to said Appikatla Kumari demanding her to return empty signed promissory note and cheque, which were obtained by her from him towards security of alleged chit transaction till today i.e. on 19.09.2025 when he was cross examined. But subsequent to his cross-examination, when the matter was posted for judgment, the accused filed petition to reopen the case for the purpose of marking of some more documents including Ex.D18, which is the legal notice dated 02.12.2025 got issued by the accused to Appikatla
Kumari for return of original blank cheque bearing No.029885 and the blank promissory note executed by the accused if, still she is in possession of the same or to furnish written confirmation that she handed over them to
Smt.Kallepalli Venkata Lakshmi and Kallepalli Bala Subrahmanyam. DW.1 deposed that he has not filed any document to shows that there was a chit transaction between him and Appikatla Kumari and in the said chit transaction said Appikatla Kumari obtained his empty signed promissory note and cheque towards security. DW.1 admitted that he has not stated during his examination U/s.251 Cr.P.C. and U/s.313 Cr.P.C specifically that the complainant obtained empty signed cheque and empty signed promissory note from Appikatla Kumari and filed this complaint, but he stated in his examination U/s.313 Cr.P.C. that this case is got filed by some other person through the complainant. Dw.1 admitted that he has not taken any legal action against the complainant or Appikatla Kumari or K.Bala Subrahmanyam.
Dw.1 adds that as this case is pending, he has not taken any legal action
C.C.No.421 of 2023 11 V ACJM, VJA against them. Dw.1 denied the suggestion that he borrowed Rs.10,00,000/- from the complainant and executed Ex.P1 in favour of the complainant and that to discharge the part of the debt covered under Ex.P1 he issued Ex.P2 cheque in favour of the complainant. Dw.2 admitted that no documentary proof is filed to show that her husband was one of the member of the chit maintained by Kumari of Machilipatnam. Dw.2 deposed that they have not issued any legal notice to Kumari of Machilipatnam, mother of Kallepalli Bala
Subrahmanyam and also Kallepalli Bala Subrahmanyam for the alleged misuse of empty signed promissory note and cheque of her husband which were given to said Kumari in the chit transaction.
18.Though, the accused is contending that he has given Ex.P1 and
P2 with empty signatures to one Appikatla Kumari of Machilipatnam towards security of chit transaction, admittedly, the accused has not filed any documentary proof to show that said Appikatla Kumari was running private chits, in which the accused was one of the member. It is also an admitted fact that the accused has not given any notice to said Appikatla Kumari till he was cross examined in this case, demanding her to return his empty signed promissory note and cheque. It is not the case of the accused that he has taken any legal action against said Appikatla Kumari or the complainant or
Kallepalli Bala Subrahmanyam, who is the son in law of complainant for the alleged misuse of his empty signed promissory note and cheque which were handed over to Appikatla Kumari towards security in the chit transaction. If really, the complainant filed this complaint by misusing the empty signed promissory note and cheque of the accused, which were given to Appikatla
Kumari towards security of chit transaction, the accused ought to have taken legal action against said Appikatla Kumari and the complainant. Since, the accused has given Ex.D18 legal notice subsequent to his cross-examination as DW.1, no evidentiary value can be attached to it as it was issued by the accused to fill the lacunae in his case, because the accused ought to have given said legal notice to said Appikatla Kumari demanding her to return his
C.C.No.421 of 2023 12 V ACJM, VJA alleged empty signed promissory note and cheque after completion of alleged chit transaction, but the reasons best known to the accused he has not taken such steps. Further, except the self serving oral evidence of Dws.1 and 2 there is no other evidence to believe the version of the accused. Hence, the version of the accused that his empty signed promissory note and cheque are misused by the complainant is not believable.
19.The learned counsel for the accused submitted that in view of friendship between the accused and Kallepalli Bala Subrahmanyam some property was got registered in the name of Kallepalli Bala Subrahmanyam by the accused and subsequently, he failed to re-transfer the same, so disputes arose between the accused and said Bala Subrahmanyam for which panchayat took place and in the said Panchayat said Bala Subrahmanyam agreed to re-transfer the land in favour of the accused and he also agreed to take Ekalinga Enterprises business and he will repay the loan of the firm apart from paying Rs.6,00,000/- to the accused within one month, but on the very next day said Subrahmanyam sent SMS message to the accused stating that he cannot pay the agreed amount and he wanted to conduct panchayat once again, but since then no panchayat took place and later said Bala
Subrahmanyam got misused the empty signed promissory note and cheque of the accused. During evidence, Dw.1 deposed that in the year, 2016 he has purchased Ac.0.06 cents of land under Ex.D8 from one U.Durga Venkata
Aravind at Machilipatnam, at the time of registration of the said property,
Ex.D8 was registered in his name and also in the name of Kallepalli Bala
Subrahmanyam for Ac.0.03 cents each, but the entire consideration of
Ac.0.06 cents was paid by him. DW.1 also deposed that he has purchased
Ac.0.06 cents of property under Ex.D9 on 13.10.2016 from one Ammaji at
Gannavaram. Dw.1 further deposed that on 19.06.2017 while he was at
Vijayawada said Kallepalli Bala Subrahmanyam informed him that the server in Sub- Registrar, Gannavarm was not working so, the property which was purchased by him under Ex.D9 is to be registered at Visannapeta, saying so,
C.C.No.421 of 2023 13 V ACJM, VJA said Kallepalli Bala Subrahmanyam got registered the property under Ex.D9 on his name under Ex.D2 stating that he will re-register the same on the name of the accused subsequently. DW.1 further deposed that as there was demonetization of currency notes immediately after Ex.D9 there was delay in getting registration of property under Ex.D9 so, if he did not agree to get register the property on 19.06.2017 his vendor may not register the property so he agreed to register the property on the name of Kallepalli
Subrahmanyam.
20.Dw.1 further deposed that in the month of August, 2017 he informed Kallepalli Bala Subrahmanyam, but there is one party to purchase the property covered under Ex.D2 and asked him to get register the same in his favour for which said Bala Subrahmanyam questioned him that what is the said property. Dw.1 further deposed that till Bala Subrahmanyam refused to register the property covered under Ex.D2 to the party to whom he sold the same, there were good terms between them. Then the accused took the issue to the elders in the month of November, 2017. But with regard to the above property disputes, between the accused and Kallepalli Bala
Subrahmanyam, except the self serving oral evidence of DW.1, there is no other documentary evidence, so the version of the accused is not believable.
21.Dw.1 further deposed that on 18.03.2018 one Veeranki
Nageswara Rao, Veeranki Divya and another came to his house and they made galata while his wife, who was pregnant, was alone present in the house stating that he borrowed Rs.18,00,000/- from his worker and he is not repaying the same, so his wife lodged report to the police Penamaluru against them. Dw.1 further deposed that after the galata he came to know that at the time of said incident Kallepalli Subrahmanyam was present in the house of
Veeranki Nageswara Rao so, his wife included the name of Kallepalli Bala
Subrahmanyam in the report given to the police stating that at the instigation of Kallepalli Balasubrahmanyam and Kallepalli Venkata Lakshmi, said 3
C.C.No.421 of 2023 14 V ACJM, VJA persons came to his house and committed the said offence but, since the brother of said Bala Subrahmanyam by name Kallepalli Venkata Ramana is working in police department he managed the police so, the names of
Kallepalli Bala Subrahmanyam and Kallepalli Venkata Lakshmi were not added. Dw.1 further deposed that in the said case Veeranki Nageswara Rao and two others were convicted as they admitted the offence and DW.2 preferred an appel against the said judgment, wherein she mentioned that
Kallepalli Bala Subrahmanayam and Kallepalli Venkata Lakshmi are also to be added, but the said appeal was returned with objections so, on 30.08.2019 himself and his wife came to Vijayawada Court to attend in the said appeal.
During cross-examination, DW.1 admitted that on 21.03.2018 his wife lodged report under Ex.D11. Dw.1 deposed that he has not filed any document to show that there were disputes between him and the complainant and also between him and Kallepalli Bala Subrahmanyam prior to 18.03.2018. Dw.1 also deposed that he has not filed any document to show that there were disputes between him and Veeranki Nageswara Rao and Veeranki Divya and
Veeranki Venkateswara Rao, who are accused in Ex.D11 prior to 18.03.2018.
Dw.1 admitted that the name of the complainant of this case is not mentioned in Ex.D11. Dw.1 also deposed that it is not mentioned in Ex.D11 that there was involvement of complainant in the said incident. Dw.1 further deposed that in Ex.D12 the name of complainant or Kallepalli Bala Subrahmanym are not mentioned. Dw.1 denied the suggestion that himself and his wife are having the habit of giving false report to the police, so, police Penamaluru chastised them. Admittedly, the accused has not filed any documentary proof to show that the complainant or his son in law Kallepalli Bala Subrahmanyam involved in the alleged offence for which Ex.D11 FIR was registered and
Ex.D12 Charge sheet was filed so, the version of the accused is not believable.
22.The learned counsel for the accused submitted that the complainant failed to prove passing of consideration under Ex.P1 and also
C.C.No.421 of 2023 15 V ACJM, VJA existence of legally enforceable debt, as the complainant failed to examine
Kallepalli Bala Subramanyam, who is the alleged scribe of Ex.P1 and as PW.2 is the interested witness, who is closely associated with PW.1. During cross- examination, PW.1 deposed that he knows the accused through his son in law
Bala Subrahmanyam for the last 14 years. PW.1 further deposed that Bala
Subramanyam is the scribe of Ex.P1 promissory note, one V.V.Raju and Kiran
Kumar are the attestors of Ex.P1 and he called both attestors and he knows the attestors for the last 7 or 8 years. PW.1 also deposed that the accused and his son in law Kallepalli Bala Subramanyam are friends, but he does not know whether the quarrel took place between his son in law and the accused or not and that the accused lodged report against his son in law at
Penamaluru Police station in the year, 2018 or not. PW.2 deposed that he was doing real Estate business along with PW.1 in earlier days and he got acquaintance with the complainant for the last 8 years. PW.2 further deposed that he knows the accused Nagarjuna Kumar. PW.2 denied the suggestion that since he is the friend of the complainant he came to the Court to support the case of the complainant. Except the above said suggestions nothing was elicited from PW.2 to discredit his evidence. Merely because PW.2 is known to PW.1 it cannot be said that he is interested witness. So, there is no good reason to disbelieve the evidence of PW.2 with regard to his presence at the time of execution of Ex.P1 by the accused in favour of complainant and also passing of consideration to the accused under Ex.P1.
23.The learned counsel for the accused further submitted that Ex.P2 cheque was presented on 30.08.2019 in State Bank of India, Patamata
Branch and the same was returned on 31.08.2019 with an endorsement “Account Blocked – situations covered in 2125” under Ex.P3 cheque return memo, which is not comes under the purview of Section 138 of N.I. Act. On the other hand, the learned counsel for the complainant submitted that even the dishonour of cheuqe on the ground of “Account blocked is also comes under purview of Section 138 of Negotiable Instruments Act. In this regard it
C.C.No.421 of 2023 16 V ACJM, VJA is pertinent to refer the decision of the Hon’ble Apex Court reported in 2013
Cri.L.J 3288 (Supreme Court), M/s.Lakshmi Dyechem Vs. State of Gujarat
and others, wherein in para No.15 it was held that;
15. The above line of decisions leaves no room for holding that the two contingencies envisaged under Section 138 of the Act must be interpreted strictly or literally. We find ourselves in respectful agreement with the decision in NEPC Micon Ltd., (AIR 1999 SC 1952 : 1999 AIR SCW 1637) (supra) that the expression “amount of money………….. is insufficient” appearing in Section 138 of the Act is a genus and dishonour for reasons such as account closed”, “ payment stopped”, “referred to the drawer” are only species of that genus. Just as dishonour of a cheque on the ground that the account has been closed is a dishonour falling in the first contingency referred to in Section 138, so also dishonour on the ground that the “signatures do not match” or that the “image is not found”, which too implies that the specimen signatures do not match the signatures on the cheque would constitute a dishonour within the meaning of Section 138 of the Act. This Court has in the decisions referred to above taken note of situations and contingencies arising out of deliberate acts of omission or commission on the part of the drawers of the cheques which would inevitably result in the dishonour of the cheque issued by them. For instance this Court has held that if after issue of the cheque the drawer closes the account it must be presumed that the amount in the account was nil hence insufficient to meet the demand of the cheque. A similar result can be brought about by the drawer changing his specimen signature given to the bank or in the case of a company by the company changing the mandate of those authorised to sign the cheques on its behalf. Such changes or alteration in the mandate may be dishonest or fraudulent and that would inevitably result in dishonour of all cheques signed by the previously authorised signatories. There is in our view no qualitative difference between a situation where the dishonour takes place on account of the substitution by a new set of authorised signatories resulting in the dishonour of the cheques already issued and another situation in which the drawer of the cheque changes his own signatures or closes the account or issues instructions to the bank not to make the payment. So long as the change is brought about with a view to preventing the cheque being honoured the dishonour would become an offence under Section 138 subject to other conditions prescribed being satisfied. There may indeed be situations where a mismatch between the signatories on the cheque drawn by the drawer and the specimen available with the bank may result in dishonour of the cheque even when the drawer never intended to invite such a dishonour.
Ex.P2 cheque was dishonoured under Ex.P3 on the ground that “Account Blocked situation covered - 2125”, which is species of funds
Insufficient which is genus which is appearing in Section 138 of NI Act. In view of the above judgment of the Hon’ble Apex Court this Court is of the view that the reason mentioned in Ex.P3 comes under Section 138 of NI Act.
C.C.No.421 of 2023 17 V ACJM, VJA
24.The learned counsel for the accused further submitted that the complainant failed to comply the mandatory notice as Ex.P4 and P7 legal notices were not issued to the correct address of the accused so, the complaint is not maintainable. To support his contention he relied on a decision reported in (2007) 6 SCC 555, C.C.Alavi Hazi vs. Palapetty
Muhammed wherein in para No.10 it was held that;
10. It is, thus, trite to say that where the payee dispatches the notice by registered post with correct address of the drawer of the cheque, the principle incorporated in Section 27 of the GC Act would be attracted; the requirement of Clause (b) of proviso to Section 138 of the Act stands complied with and cause of action to file a complaint arises on the expiry of the period prescribed in Clause (c) of the said proviso for payment by the drawer of the cheque. Nevertheless, it would be without prejudice to the right of the drawer to show that he had no knowledge that the notice was brought to his address.
On perusing the said decision, this Court is of the view that it supports the case of the complainant instead of the version of the accused.
25.On the other hand, the learned counsel for the complainant submitted that initially the complainant issued Ex.P4 legal notice dated 05.09.2019 to the known address of the complainant, but it was returned with an endorsement “No such door number in his Village” so, the complainant again issued Ex.P7 notice dated 24.09.2019 to the correct address of the accused, but it was also returned with an endorsement that “the addressee not in town – 7 days passed” so it is deemed service of notice. In this regard the learned counsel for the accused submitted that the doctrine of deemed service applies where the notice was duly applied and addressee deliberately evaded to receive it, but in this case there is no such finding so, the complainant deliberately sent notice to the incorrect and incomplete address despite knowing the correct address of the accused. The leanred counsel for the accused further submitted that the complainant has not filed any postal receipts to show that he has booked postal covers of Ex.P4 and P7, so, the version of complainant is not believable. Ex.P4 legal notice was issued to the accused to the following address i.e. D.No.13-100, beside Ashok Locks,
Penamaluru Village and Mandal, Krishna District, A.P., - 520007, whereas
C.C.No.421 of 2023 18 V ACJM, VJA
Ex.P7 notice was issued to the following address of the accused D.No.20/516- 28-6, NGOs Colony, Parasupet, Machilipatnam, Krishna District, A.P. During cross-examination, DW.1 admitted that in Ex.D3 to D9 his address is mentioned as D.No.20/516-28-6, NGOs Colony, Parasupet, Machilipatnam.
Dw.1 also admitted that Ex.P7 notice was sent by the complainant to his address D.No.20/516-28-6, NGOs Colony, Parasupet, Machilipatnam. Dw.1 adds that till the date of death of his father i.e. October, 2018 he used the said address for communication as it is his permanent address. Dw.1 also deposed that himself and his wife residing in the same house. Dw.1 denied the suggestion that the address mentioned in Ex.P4 legal notice and the address mentioned in the report given by his wife to police Penamaluru is one and the same. DW.1 deposed that in Crl.M.P.No.1355/2023 which was filed by him U/s.437 Cr.P.C. i.e. Ex.P11 seeking Bail he has mentioned his address
as 13-100, Ashok Locks, Penamaluru Village, Krishna District. But, DW.1
adds that the address mentioned in Ex.P11 is not correct. Dw.1 deposed that himself and his wife are living together under one roof, his wife stood as surety to him, his wife filed her Aadhar Card and surety memo, which is marked as Ex.P12. DW.1 deposed that in Ex.P12 the address of his wife is shown as follows Bhavani Nidumolu W/o. Nagarjuna Kumar Nidumolu, 13- 100, Siva Prasad Nagar, Yenamalakuduru, Penamaluru Village, Andhra
Pradesh – 520007. Dw.1 adds that they resided in the address mentioned in
Ex.P12 prior to 2018. During further cross-examination, dated 14.11.2025
Dw.1 admitted that in Ex.D11 his wife is the defacto complainant and her door number is shown as 13-100. Dw.1 admitted that his door number is mentioned as 13-100 in Ex.P4 legal notice.
26.The complainant got issued Ex.P4 legal notice on 05.09.2019.
As per the Ex.D11 the wife of accused lodged Ex.D11 report to the police on 21.03.2018 by mentioning her door number as 13-100. The complainant got issued Ex.P4 legal notice to the very same address of the accused which is mentioned in Ex.P1 promissory note however, Ex.P4 notice was returned
C.C.No.421 of 2023 19 V ACJM, VJA unserved under Ex.P6 with an endorsement “ No such door number in this
Village”. Since, the complainant got issued Ex.P4 legal notice to the address which is mentioned in Ex.P1 it is for the accused to prove that there is no such door number and the complainant has issued Ex.P4 to the wrong address. The learned counsel for the accused further submitted that the door number 13-100, which is mentioned in Ex.P1 and Ex.P4 legal notice is not assigned to any house in Yenamalakuduru by Tadigadapa Municipality as per municipal records and to prove the same the accused has got filed and marked Ex.D17. As per Ex.D17, 13-100 door number was not assigned to any house in Yanamalakuduru circle as per municipal records. Ex.D17 was obtained under Right Information Act by one Smt. B.Bhavya Sri. As it was not obtained by the accused the learned counsel for the complainant raised an objection so, Ex.D17 was marked subject to objection as to admissibility.
Admittedly, Ex.D17 was not obtained by the accused under Right Information
Act. The accused has not examined the concerned authority, who issued
Ex.D17. So, Ex.D17 is not admissible in evidence, as such it cannot be considered. More over as discussed supra as per Ex. P11 and P12, Dws 1 and 2 were resided in house D. No. 13-100, Yanamalakuduru Vijayawada.
27.Furthermore, after return of Ex.P4 under Ex.P6, the complainant again issued Ex.P7 to the permanent address of the accused within the period of limitation. Admittedly, the accused himself mentioned his address in
Exs.D3 to D9. On behalf of the accused Ex.D14 residence certificate dated 04.12.2025 issued by Tahsildar, Vijayawada East was marked. DW.1 deposed that as per Ex.D14 he has been residing in house D.No.74-26-12/A,
Chowdary Pet, Ayyappa Nagar, East, for the last 7 years. During cross- examination, Dw.1 admitted that in Ex.D14 it is not specifically mentioned that from which date he has been residing in the address mentioned in it. Dw.1 admitted that during examination in chief as DW.1 is stated that he is residing in Yelakuru Village of Pamarru Mandal as on 26.05.2025. Except marking
Ex.D14, which was marked subject to objection as to admissibility, the
C.C.No.421 of 2023 20 V ACJM, VJA accused has not filed any other document nor examined the Tahsildar concerned, who issued Ex.D14 to prove the contents of Ex.D14. If really, the accused has been residing in the address mentioned in Ex.D14 as on 04.12.2025, he must to have stated the address mentioned in Ex.D14 while he was examined as Dw.1 before this Court on 26.05.2025 so, it is creating doubt on Ex.D14 residence certificate.
28.Since, the complainant has issued Ex.P7 notice to the permanent address of the accused, which is also mentioned by the accused in Ex.D3 to
D9, the complainant has issued Ex.P7 notice to the correct address of the accused. Ex.P7 notice was returned under Ex.P9 with an endorsement “addressee not in town 7 days passed hence returned”. If really, the accused was not residing in the address mentioned in Ex.P7 as on the date of Ex.P7 the endorsement on Ex.P9 must be no such addressee in the door number. It is not the case of accused that the endorsement on Ex.P9 is not correct. If the accused wants to dispute the endorsement on Ex.P9, the burden lies on him to prove that the endorsement on Ex.P9 is not correct. When the accused has not denied his residential address for which Ex.P7 legal notice was sent, it is for the accused to rebut the presumption under Section 27 of
General Clauses Act, by adducing necessary evidence and the burden lies on the accused to examine the postman concerned to prove his plea of non service of statutory notice to him. In a decision reported in 2015 (2) ALD
(Crl.) Pg.318 Para No.22 to 24. Between Mutyala bhushanam V. Patneedi
Sreeramamurthy and another.
22. From the above decisions of the Supreme Court reported supra, it is clear that when a notice is sent by registered post by correctly addressing the drawer of the cheque, the mandatory requirement of issue of notice in terms of clause (b) of proviso to Section 138 of the Act stands complied with. Then, it is for the drawer to rebut the presumption about the service of notice and show that he had no knowledge that the notice was brought to his address or that the address mentioned on the cover was incorrect or that the letter was never tendered or that the report of the postman was incorrect.
23. In the instant case, the accused contended that the complainant got managed the postal authorities and got the endorsement. On the other
C.C.No.421 of 2023 21 V ACJM, VJA hand, the complainant contended that the accused managed the postal authorities and got returned the notice to avoid payment. It is also contended that a person, who does not pay amount, within time stipulated as per the provisions of Section 138 of the Negotiable Instruments Act, by ignoring statutory presumption to the contrary under section 27 of the General Clauses Act and Section 114 of the Evidence Act. In this case, the endorsement on Ex.P5 clearly indicates that the complainant sent notice to the accused to the address mentioned in the promissory note executed by the accused. Probably, the accused must be knowing about the change of door number and got mentioned the same in the promissory note executed by him. If at all the door number is not existing in the year 1998, he would have raised objection for the same being mentioned in the promissory note or he would have given suitable notice to the complainant stating that he has obtained blank promissory note and got mentioned door number subsequently. In Ex.P5 cover, it is clearly mentioned as ‘not claimed, hence returned to the sender’. It is for the accused to rebut the presumption by adducing evidence that the notice as never tendered and that the report of the postman was incorrect.
24. In view of the above, it is clear that the complainant has dispatched notice to the correct address of the accused and thus complied with the statutory provision under section 138-B of the Negotiable Instruments Act. The accused did not dispute the correctness of the address mentioned on the envelopes and received the court summons to the address at the D.No.23-36-6. Thus, the complainant would be able to prove that the drawer of the cheque knew about the notice issued to him and deliberately avoided service of notice and got false endorsement only to defeat the claim. The trial court considering provisions of Section 20 of the Act, after appreciating the entire evidence on record and after relying on the decisions, rightly, found the guilt of the accused under Section 138 of Negotiable Instruments Act. Therefore, the finding of the learned Metropolitan Sessions Judge that it is for the complainant to examine the postman concerned to prove the endorsement on Ex.P5 is erroneous. When the evidence on record clearly indicates that the accused not claimed, it was returned to the sender, therefore, the finding of the Metropolitan Sessions Judge that the complainant has failed to prove that he issued demand notice to accused is contrary to the evidence on record and is, therefore, liable to be set aside.
The learned counsel for the complainant also relied on a decision reported in Crl.L.J 3937 SC, M/s.Ajeet Seeds Ltd Vs. K.Gopala Krishnaiah wherein in para No.9 it was held that;
9. This Court then explained the nature of presumptions under Section 114 of the Evidence Act and under Section 27 of the GC Act and pointed out how these two presumptions are to be employed while considering the question of service of notice under Section 138 of the NI Act. The relevant paragraphs read as under:
"13. According to Section 114 of the Act, read with Illustration (f) thereunder, when it appears to the Court that the common course of business renders it probable that a thing would happen, the Court may draw presumption that the thing would have happened, unless there are circumstances in a particular case to show that the common course of business was not followed. Thus, Section 114 enables the Court
C.C.No.421 of 2023 22 V ACJM, VJA to presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business in their relation to the facts of the particular case. Consequently, the court can presume that the common course of business has been followed in particular cases. When applied to communications sent by post, Section 114 enables the Court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. But the presumption that is raised under Section 27 of the G.C. Act is a far stronger presumption. Further, while Section 114 of Evidence Act refers to a general presumption, Section 27 refers to a specific presumption. For the sake of ready reference, Section 27 of G.C. Act is extracted below:
"27. Meaning of service by post.- Where any Central Act or regulation made after the commencement of this Act authorizes or requires any document to be served by post, whether the expression ‘serve’ or either of the expressions ‘give’ or ‘send’ or any other expression is used, then, unless a different intention appears, the service shall be deemed to be effected by properly addressing, pre-paying and posting by registered post, a letter containing the document, and, unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post".
14. Section 27 gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. In view of the said presumption, when stating that a notice has been sent by registered post to the address of the drawer, it is unnecessary to further aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business. This Court has already held that when a notice is sent by registered post and is returned with a postal endorsement ‘refused’ or ‘not available in the house’ or ‘house locked’ or ‘shop closed’ or ‘addressee not in station’, due service has to be presumed. [ Vide Jagdish Singh Vs. Natthu Singh (1992) 1 SCC 647; State of M.P. Vs. Hiralal & Ors. ( 1996) 7 SCC 523 and V.Raja Kumari Vs. P.Subbarama Naidu & Anr. (2004) 8 SCC 74] It is, therefore, manifest that in view of the presumption available under Section 27 of the Act, it is not necessary to aver in the complaint under Section 138 of the Act that service of notice was evaded by the accused or that the accused had a role to play in the return of the notice unserved."
29.In the case on hand also the complainant has issued Ex.P7 legal notice to the accused to the address of the accused which is not denied except stating that he was not residing in the said address as on the date of
Ex.P7. The address mentioned in Ex.P7 and the address mentioned in Ex.D3 to D9 which were filed by the accused himself is one and the same. So, statutory presumptions under Section 27 of the General Clauses Act and
Section 114 of the Evidence Act are in favour of the complainant. Hence, it is
for the accused to rebut presumptions by adducing evidence that the notice
was never tendered to his address and he was not residing in the said
C.C.No.421 of 2023 23 V ACJM, VJA address as on the date of notice. But, the accused has not adduced any evidence to rebut the said presumptions, except filing Ex.D14 which is also doubtful as the accused failed to prove its contents. Hence this Court is of the view that the above said decisions are squarely applicable to the facts of the case on hand.
30.The learned counsel for the accused further submitted that since, the accused placed probable defence, the burden shift to the complainant to prove his financial capacity/source of funds to lend huge amount of
Rs.10,00,000/-, but the complainant failed to place any evidence either oral or documentary to prove his financial capacity and the complainant has not shown the debt in question in his Income Tax Returns and he has not filed his
Income Tax returns so, the alleged debt in question is not legally enforceable debt. To support his contention the learned counsel for the accused relied on the following decisions:
I.(2022) 6 Supreme Court Cases 735 Tedhi Singh Vs. Narayana Das
Mahant, wherein in para No.10 it was held that;
10. The Trial Court and the First Appellate Court have noted that in the case under Section 138 of the N. I. Act the complainant need not show in the first instance that he had the capacity. The proceedings under Section 138 of the N. I. Act is not a civil suit. At the time, when the complainant gives his evidence, unless a case is set up in the reply notice to the statutory notice sent, that the complainant did not have the wherewithal, it cannot be expected of the complainant to initially lead evidence to show that he had the financial capacity. To that extent the Courts in our view were right in holding on those lines. However, the accused has the right to demonstrate that the complainant in a particular case did not have the capacity and therefore, the case of the accused is acceptable which he can do by producing independent materials, namely, by examining his witnesses and producing documents. It is also open to him to establish the very same aspect by pointing to the materials produced by the complainant himself. He can further, more importantly, achieve this result through the cross examination of the witnesses of the complainant. Ultimately, it becomes the duty of the Courts to consider carefully and appreciate the totality of the evidence and then come to a conclusion whether in the given case, the accused has shown that the case of the complainant is in peril for the reason that the accused has established a probable defence.
II.2004 Crl.L.J 4107 (SC) Nagisetty Nagaiah Vs. State of A.P. and another, where in in Para No.11 and 12 it was held that;
C.C.No.421 of 2023 24 V ACJM, VJA
11. In almost identical situation, the apex Court in C. Antony v. K.G. Raghavan Nair , (2002) 2 Andh LD (Crl) 880 : (2003 Cri LJ 411) held that : "8. Then again, it is to be noticed that the trial Court also took into consideration the plea of the appellant that the cheque in question was given in a blank state to Chandrappa Panicker and he being a close friend of the respondent in collusion with each other misused the said cheque to defraud the appellant. The trial Court also observed that non examination of Chandrappa Panicker has also weakened the case of the respondent especially in view of the fact that the Court had noticed that the said Chandrappa Panicker was seen in the premises of the Court house at the time of trial. This is also relevant factor on which the trial Court relied upon but the High Court did not consider the effect of the said default on the part of the respondent. The third circumstance relied upon by the trial Court is in regard to the difference in the ink found in the body of the cheque as well as in the signature of the appellant. It is the case of the respondent that the appellant had filled up the cheque in its entirety including its signature and had brought the cheque to the office of Vijay Kumar to be handed over to the respondent but the learned Magistrate on a perusal of the cheque, found that the ink used in the body of the cheque was different from the ink used in the signature on the cheque, therefore, he drew an inference that the case put forth by the respondent was doubtful, hence, could not be accepted. Even in this regard the High Court has failed to apply its mind. Having considered the findings delivered by the trial Court in regard to the above 3 points, we are of the opinion that the trial Court was justified in coming to the said conclusion because of the above three deficiencies pointed out by the trial Court, and that the respondents complaint ought to fall. In such a situation, we are of the opinion that the High Court fell in error in re-appreciating the case of the respondent on a totally different perspective without coming to the conclusion that the findings given by the trial Court on the above three points are either irrelevant or contrary to material on record. Therefore, following the view laid down by this Court in the above said cases of Bhim Singh Rup Singh (supra) and Dharamdeo Singh (supra), we are of the opinion that the High Court was in error in reversing the findings of acquittal recorded by the trial Court."
12. The facts of the instant case are almost similar to the one in the above case. Therefore, it cannot be said that the trial Court was wrong in rejecting the plea of the complainant and acquitting the accused. The initial burden does not mean that it is a burden on the part of the complainant to prove that there was a legally enforceable debt or liability by leading evidence. The mere basic facts of the case should inspire the invocation of the legal presumption under Section 139 of the Act. In the absence of such factual basis, the lower Court cannot be said to have erred in holding that the initial burden was not discharged by the complainant, which is absent in this case, as seen above.
III.AIR 2008 SC 1325, Krishna Janardhan Bhat Vs. Dattatraya G.Hegde, wherein in para No.19 it was held that;
19. The courts below failed to notice that ordinarily in terms of Section 269SS of the Income Tax Act, any advance taken by way of any loan of more than Rs. 20,000/- was to be made by way of an account payee cheque only. Section 271D of the Income Tax Act reads as under:
C.C.No.421 of 2023 25 V ACJM, VJA 271D. Penalty for failure to comply with the provisions of section 269SS. (1) If a person takes or accepts any loan or deposit in contravention of the provisions of section 269SS, he shall be liable to pay, by way of penalty, a sum equal to the amount of the loan or deposit so taken or accepted. (2) Any penalty imposable under sub-section (1) shall be imposed by the Joint Commissioner.
IV.2019(2) ALT (Crl) 1 SC, Basalingappa Vs. Mudibasappa, wherein in para No.25 it was held that;
25. There was another evidence on the record, i.e., copy of plaint in O.S. No. 148 of 2011 filed by the complainant for recovery of loan of Rs. 7 lakhs given to one Balana Gouda in December, 2009. Thus, there was evidence on record to indicate that in December, 2009, he gave Rs.7 lakhs in sale agreement, in 2010, he made payment of Rs.4,50,000/- towards sale consideration and further he gave a loan of Rs.50,000/- for which complaint was filed in 2012 and further loan of Rs.6 lakhs in November, 2011. Thus, during the period from 2009 to November, 2011, amount of Rs.18 lakhs was given by the complainant to different persons including the accused, which put a heavy burden to prove the financial capacity when it was questioned on behalf of the accused, the accused being a retired employee of State Transport Corporation, who retired in 1997 and total retirement benefits, which were encashed were Rs.8 lakhs only. The High Court observed that though the complainant is retired employee, the accused did not even suggest that pension is the only means for survival of the complainant. Following observations were made in Paragraph 16 of the judgment of the High Court:- “16. Though the complainant is retired employee, the accused did not even suggest that pension is the only means for survival of the complainant. Under these circumstances, the Trial Court’s finding that the complainant failed to discharge his initial burden of proof of lending capacity is perverse.”
V. 2014 (1) ALT (Crl) 342 = (2013) 3 Supreme Court Cases 86,
Vijay Vs. Lakshman and Another, wherein in para No.24 it was held that;
24. Presumptions under Sections 118(a) and Section 139 were held to be rebuttable on a preponderance of probabilities in Bharat Barrel & Drum Manufacturing Company v. Amin Chand Pyarelal (1999) 3 SCC 35 also where the Court observed:
“11… Though the evidential burden is initially placed on the defendant by virtue of S.118 it can be rebutted by the defendant by showing a preponderance of probabilities that such consideration as stated in the pronote, or in the suit notice or in the plaint does not exist and once the presumption is so rebutted, the said presumption 'disappears'. For the purpose of rebutting the initial evidential burden, the defendant can rely on direct evidence or circumstantial evidence or on presumptions of law or fact. Once such convincing rebuttal evidence is adduced and accepted by the Court, having regard to all the circumstances of the case and the preponderance of probabilities, the evidential burden shifts back to the plaintiff who has also the legal burden.”
C.C.No.421 of 2023 26 V ACJM, VJA
VI.2006 (3) Supreme court Cases (Crl) 30 M.S.Narayana Menon @
Mani Vs. State of Kerala and Anr, wherein in para Nos.34 and 35 it was held that; 34.The Second Respondent herein was a member of a Stock Exchange. The transactions in relation to the Stock Exchange are regulated by the statutes and statutory rules. If in terms of the provisions of a statute, a member of a Stock Exchange is required to maintain books of accounts in a particular manner, he would be required to do so, as non-compliance of the mandatory provisions of the Rules may entail punishment. It is not in dispute that transactions comprising purchases and sales of shares by investors is a matter of confidence. Both parties would have to rely upon one another. For the said purpose, the courts of law may also take judicial notice of the practice prevailing in such business. The learned Appellate Judge rightly did so.
35. The definite case of the second Respondent was that the cheque dated 17.8.1992 was issued by the Appellant in discharge of his debt. The said liability by way of debt arose in terms of the transactions. For proving the said transactions, the Second Respondent filed books of accounts. The books of accounts maintained by the Second Respondent were found to be not reflecting the correct state of affairs. A discrepancy of more than Rs. 14,00,000/- was found.
VII.2015 (1) SCC (Crl) 576 K.Subramani Vs. K.Damodara Naidu, wherein in para No.9 it was held that;
9.In the present case the complainant and the accused were working as Lecturers in a Government college at the relevant time and the alleged loan of Rs.14 lakhs is claimed to have been paid by cash and it is disputed. Both of them were governed by the Government Servants’ Conduct Rules which prescribes the mode of lending and borrowing. There is nothing on record to show that the prescribed mode was followed. The source claimed by the complainant is savings from his salary and an amount of Rs.5 lakhs derived by him from sale of site No.45 belonging to him. Neither in the complaint nor in the chief-examination of the complainant, there is any averment with regard to the sale price of site No.45. The concerned sale deed was also not produced. Though the complainant was an income-tax assessee he had admitted in his evidence that he had not shown the sale of site No.45 in his income-tax return. On the contrary the complainant has admitted in his evidence that in the year 1997 he had obtained a loan of Rs.1,49,205/- from L.I.C. It is pertinent to note that the alleged loan of Rs.14 lakhs is claimed to have been disbursed in the year 1997 to the accused. Further the complainant did not produce bank statement to substantiate his claim. The trial court took into account the testimony of the wife of the complaint in another criminal case arising under Section 138 of the N.I. Act in which she has stated that the present appellant/accused had not taken any loan from her husband. On a consideration of entire oral and documentary evidence the trial court came to the conclusion that the complainant had no source of income to lend a sum of Rs.14 lakhs to the accused and he failed to prove that there is legally recoverable debt payable by the accused to him.
C.C.No.421 of 2023 27 V ACJM, VJA
On the other hand, the learned counsel for the complainant submitted that the evidence of Pws.1 and 2 coupled with Ex.P1 and
Ex.P10 are sufficient to prove that the complainant was having financial capacity to lend Rs.10,00,000/- to the accused. During cross- examination, PW.1 deposed that he is doing real estate Business, but he admitted that he has not mentioned about his avocation in his chief examination affidavit. PW.1 deposed that his monthly income is nearly
Rs.50,000/-. PW.1 further deposed that at present he is not doing real estate business, but he is working as security guard in SRK College,
Enikepadu, Vijayawada. PW.1 deposed that he is not an Income tax assessee. PW.1 denied the suggestion that he never did real estate business at any point of time and he is working as security guard in SRK college, Enikepadu. PW.1 deposed that he is white ration card holder, but he denied the suggestion that Government allotted a flat in an apartment in Jakkampudi Village. PW.1 denied the suggestion that he has no financial capacity to lend such huge amount of Rs.10,00,000/- covered under Ex.P1 promissory note. To prove the the complainant is white ration card holder the accused got marked Ex. D15 which stands in the name of Kapavarapu Lakshmi and Kapavarapu Srinivasa Rao, who is the complainant. It is an admitted fact that the complainant is white ration card holder and he is not an Income tax assessee however, as per
Ex.P10 an amount of Rs.5,00,000/- on 27.07.2017 and another amount of Rs.5,00,000/- on 29.07.2017 were credited in to his account by transfer and he has withdrawn the said amounts on the said respective dates. Ex.P1 transaction took place on 01.08.2017 so, as on 01.08.2017 the complainant was having cash of Rs.10,00,000/- in his hand as he withdrawn the same on 27.07.2017 and on 29.07.2017. So, the complainant is able to prove that as on the date of Ex.P1 ie.. 01.08.2017 he was having money of Rs.10,00,000/- with him so, the version of the accused that the complainant had no financial capacity to lend
C.C.No.421 of 2023 28 V ACJM, VJA
Rs.10,00,000/- as he is white ration card holder is not tenable. So, in view of the above facts and circumstances this Court is of the considered view that the above said decisions relied by the accused with regard to financial capacity are not applicable to the facts of the case on hand.
31.With regard to non showing of the debt under Ex.P1 in the income Tax Returns and also non filing of Income Tax Returns by the complainant, in a recent judgment of Hon’ble Apex Court reported in 2025
(3) ALT (Crl) 179 Supreme Court in Sanjabij Tari Vs. Kishore S.Borcor
and another, wherein in para Nos.20 and 21 held that;
20. However, this Court is of the view that any breach of Section 269SS of the IT Act, 1961 is subject to a penalty only under Section 271D of the IT Act, 1961. Further neither Section 269SS nor 271D of the IT Act, 1961 state that any transaction in breach thereof will be illegal, invalid or statutorily void. Therefore, any violation of Section 269SS would not render the transaction unenforceable under Section 138 of the NI Act or rebut the presumptions under Section 118 and 139 of the NI Act because such a person, assuming him/her to be the payee/holder in due course, is liable to be visited by a penalty only as prescribed. Consequently, the view that any transaction above Rs.20,000/- (Rupees Twenty Thousand) is illegal and void and therefore does not fall within the definition of ‘legally enforceable debt’ cannot countenanced. Accordingly, the conclusion of law in P.C.Hari (supra) is set aside.
21. This Court also takes judicial notice of the fact that some Districts Courts and some High Courts are not giving effect to the presumptions incorporated in Sections 118 and 139 of NI Act and are treating the proceedings under the NI Act as another civil recovery proceedings and are directing the complainant to prove the antecedent debt or liability. This Court is of the view that such an approach is not only prolonging the trial but is also contrary to the mandate of Parliament, namely, that the drawer and the bank must honour the cheque, otherwise, trust in cheques would be irreparably damaged.
The above said decision is squarely applicable to the facts of the case on hand. So, even though the complainant has not filed any documentary evidence to prove his source of income, except Ex.P10 and even though the complainant has not shown the debt in question in his Income Tax returns it is no way effect the case of the complainant.
32.The learned counsel for the accused further submitted that merely because the complainant has produced Ex.P2 cheque it is not
C.C.No.421 of 2023 29 V ACJM, VJA sufficient to prove the execution of Ex.P2 and the Court cannot proceed any an assumption it was handed over to the complainant by the accused and the burden lies on the complainant to prove that how he got the cheque into his possession, but in the case on hand even then the accused is stating that
Ex.P2 cheque was not handed over to the complainant and it was the blank singed cheuqe given to one Appikatla Kumari towards security of chit transaction, the complainant failed to prove his contention so, the version of the complainant is not believable. To support his contention the learned counsel for the accused relied on a decisions reported in
I. IV (2011) BC 475 Kerala High Court, between : Shanti Vs. Mary
Sherly, wherein in para No.15 it was held that;
15. The prosecution shall however, make clear to Court, each of the circumstance which is relied upon by it, to establish drawing of the cheque by accused. The mere fact that the cheque produced in Court came from possession of complainant alone will not be sufficient to prove execution, even though it may be one of the circumstances. No law allows a Court to presume that the cheque which is produced and marked in Court was handed over or delivered to complainant by accused. The Court, at best, can say that the cheque was in possession of complainant. But, under what circumstances it came to his possession is to be stated by complainant. In the absence of such statement, Court cannot proceed on any assumption that it was handed over to complainant by accused.
II. Crl. R.C. No. 56 of 2023, between Mythili Vs. Manimegalai of High
Court of Madras dated 02.06.2025, wherein in para 10 it was held that
10. But in the present case on hand, on careful observation of the evidences, it can be noted the subject cheque was not drawn by the petitioner to fulfill a legally enforceable debt as mandated by Section 138 of the NI Act, rather, it was given to her parents to avail loan by using the said cheque as a mere security for her abroad eduction. This Court in the case of S. Jayanthi Vs. P. Sukumaran, Crl. A. No. 529 of 2017, has also held that even though the cheque was returned dishonored for the reason “ account blocked situation covered in” the other evidences should incriminate the accused beyond reasonable doubts and that onus lies on the complainant. Hence, in case of absence of legally enforceable debt, the offence under Section 138 of NI Act will not be attracted.
In the case on hand the complainant specifically pleaded that to discharge the debt covered under Ex.P1 the accused has issued Ex.P2 cheque. The complainant also proved Ex.P1 promissory note by examining
PW.2. Though the accused contended that he has not handed over Ex.P2
C.C.No.421 of 2023 30 V ACJM, VJA cheque to the complainant, but he handed over the same to one Appikatla
Kumari with blank signature towards security of chit transaction, as discussed supra, the accused failed to prove the same. So, in the above facts and circumstances of the case, this Court is of the view that the above said decisions are not applicable to the facts of the case on hand, as the complainant pleaded and proved that Ex.P2 cheque was drawn by the accused for discharge of the legally enforceable debt covered under Ex.P1.
33. The learned counsel for the accused submitted that admittedly the complainant has not filed civil suit basing on Ex.P1 promissory note. So, without filing civil suit, the complaint is not maintainable basing on Ex.P2. In this regard, learned counsel for the complainant submitted that the complainant need not file civil suit basing on promissory note for filing the complaint Under Section 138 of Negotiable Instruments Act. In a decision reported in 2006 Crl.J Page No.1 Para.42, Between Gorantla
Venkateswara Rao Vs. Kolla Veera Raghava Rao and Anr.
“ Mere non filing of the suit by itself is not circumstance leading to a conclusion that there was no legally enforceable debt. The evidence of PW-4 was that he was the scribe of the promissory note. He gave the circumstances under which he acted as scribe”
In the case on hand, during cross-examination, PW.1 admitted that he has not filed any civil suit against the accused for recovery of money covered under Ex.P1 promissory note, but in view of the above said decision mere non filing of civil suit itself is not sufficient to believe that there was no legally enforceable debt, hence, the version of the accused is not considered.
34. The other decisions relied by the accused 1.( 2010) 9 Supreme Court
Caes 189, between : Babu Vs. State of Kerala, is relating to Section 302 IPC and burden of proof when the cases rests on Circumstantial evidence and 2. I (2006) BC 526, Kerala High Court, Between: Ramachandran Vs. K. Dineshan & Anr is relating to material alteration of Negotiable Instrument, which is not the defense of the accused in this case, so this Court is of the view that the above said decisions are not applicable to the facts of the case on hand.
C.C.No.421 of 2023 31 V ACJM, VJA
35.Considering the facts and circumstances of the case, submissions made by the learned counsels for the complainant and the accused and in view of the above discussion, this Court is of the view that the accused failed to rebut the presumptions, Under Section 118 and 139
Negotiable Instruments Act and on the other hand the complainant has proved the guilt of the accused for the offence punishable under Section 138 of
Negotiable Instruments Act beyond all reasonable doubts. Accordingly point is answered.
36. In the result, the accused is found guilty and he is convicted u/s.255(2) Cr.P.C. for the offence Punishable under Section 138 of
Negotiable Instruments Act.
Typed to my dictation by the Stenographer, corrected and pronounced by me in the open court, this the 13 th day of April, 2026.
V Addl. Chief Judicial Magistrate, Vijayawada
37.Accused is present. Accused is questioned with regard to sentence to be imposed, for which the accused submitted that the complainant filed false complaint against him, he is having wife and children, who are depending on him.
The accused also submitted that he is suffering from blood pressure for which he has been taking treatment regularly and he requested to take lenient view in imposing the sentence. Since, the offence is under Section 138 of Negotiable
Instrument Act, I am of the view that the accused is not entitled for the benefit of
Sec.360 of Code of Criminal Procedure and Sec.3 and 4 of Probation of
Offenders Act 1958.
38.Considering the submission of the accused and nature of offence, the accused is sentenced to suffer simple imprisonment for a period of SIX
MONTHS and also to pay fine of Rs.5,00,000/- (Five Lakhs only) in default
of payment of fine the accused shall suffer simple imprisonment for a
period of 3 months for the offence punishable under Section 138 of
C.C.No.421 of 2023 32 V ACJM, VJA
Negotiable Instruments Act. The entire fine amount of Rs.5,00,000/- is awarded to the complainant towards compensation under Section 357 of Code of Criminal Procedure. The complainant is entitled to receive the compensation amount after lapse of appeal time.
39.The accused is informed that, he has got right of appeal. If he is not able to engage an Advocate to prefer an appeal he is at liberty to approach
Mandal Legal Services authority to get free legal aid.
Typed to my dictation by the Stenographer, corrected and pronounced by me in the open court, this the 13 th day of April, 2026.
V Addl. Chief Judicial Magistrate, Vijayawada
APPENDIX OF EVIDENCE.
WITNESSES EXAMINED FOR
COMPLAINANT:- ACCUSED:-
PW.1 – K.Srinivasa Rao DW.1 – N.Nagarjuna Kumar PW.2 – Vasa Vijaya Raju DW.2 – Nidumolu Bhavani
EXHIBITS MARKED FOR
COMPLAINANT :-
Ex.P-1 : Promissory note executed by the accused in favour of the complainant for Rs.10,00,000/- dated 01.08.2017.
Ex.P-2 : Cheque bearing No.029885 for Rs.10,00,000/- drawn on Axis Bank, Machilipatnam in favour of complainant dated 30.08.2019.
Ex.P-3:Cheque return memo, dated 31.08.2019.
Ex.P-4:Office copy of the legal notice dated 05.09.2019.
Ex.P-5:Postal receipt dated 05.09.2019.
Ex.P-6:Unserved return registered cover dated 07.09.2019.
Ex.P-7:Office copy of the legal notice dated 24.09.2019.
C.C.No.421 of 2023 33 V ACJM, VJA
Ex.P-8:Postal receipt dated 24.09.2019.
Ex.P-9:Unserved return postal cover dated 01.10.2019.
Ex.P-10:Statement of account from SBI dated 01.08.2023 for the period 01.07.2017 to 01.08.2017.
Ex.P-11:Bail petition filed by the accused U/s.437 Cr.P.C. in
Crl.M.P.no.1355/2023 in CC.No.421/2023 on the file of this
Court.
Ex.P-12:Copy of Aadhar Card of wife of the accused.
FOR DEFENSE:
Ex.D-1 : Original Aadhar Card.
Ex.D-2 : Certified copy of Regd. Sale deed dated 19.06.2017 executed by Smt.M.Ammaji in favour of Sri.kallepalli Bala Subrahmanyam.
Ex.D-3:Online copy of statement of account of the accused account bearing No.915010043198807 of Axis Bank Ltd., Machilipatnam for the period from 01.04.2017 to 30.04.2017.
Ex.D-4:Office copy of notice dated 31.03.2018 issued by the accused to Smt. Kallepalli Venkata Lakshmi.
Ex.D-5:Office copy of notice dated 19.04.2018 issued by the accused to the Registrar of firms, Machilipatnam.
Ex.D-6:Acknowledgment of Registration of firm dated 04.08.2015.
Ex.D-7Original Deed of partnership dated 04.08.2015.
Ex.D-8:Original agreement of sale dated 10.03.2016 executed by U.Durga Venkata Aravind in his favour.
Ex.D-9:Original agreement of sale dated 13.10.2016 executed by M.Ammaji in his favour.
Ex.D-10:Record slip of cheque book account bearing No.915010043198807 of Axis Bank Limited.
Ex.D-11:Certified copy of FIR in Crime No.184/2018 of Penamaluru P.S.
Ex.D-12:Certified copy of Charge sheet in CC.No.328/2018 on the file
C.C.No.421 of 2023 34 V ACJM, VJA of VI Addl. Judicial Magistrate of First Class, Vijayawada.
Ex.D-13:Certified copy of rice card number 2806139247 of complainant dated 01.12.2025 issued by Office of Commissioner, Civil Supplies, Vijayawada (Marked Subject to objection as to admissibility).
Ex.D-14:Residence certificate dated 04.12.2025 issued by Tahsildar, Vijayawada East (Marked Subject to objection as to admissibility).
Ex.D-15:Ration Card/Rice card stands in the name of Kapavarapu Rama Lakshmi and Kapavarapu Srinivasa Rao issued by Asst. Supply Officer, Vijayawada dated 22.12.2025 along with covering letter dated 20.12.2025 under Rigth to Information Act given to B.Bhavya (Marked to subject to objection as to admissibility).
Ex.D-16:Certified copy of Death Certificate of Nidumolu Venkata Subrahmanya Vara Prasada Rao, dated 05.12.2018.
Ex.D-17:Endorsement dated 15.12.2025 issued by Public Information Officer and Revenue Officer, Tadigadapa Municipality to B.Bhavyasri (Marked subject to objection as to admissibility).
Ex.D-18:Office copy of the legal notice dated 02.12.2025 got issued by the accused to one Appikatla Kumari.
Ex.D-19:Postal Tracking report dated 05.12.2025 (Marked subject to objection as to admissibility).
V Addl. Chief Judicial Magistrate, Vijayawada
C.C.No.421 of 2023 35 V ACJM, VJA
IN THE COURT OF THE V ADDL. CHIEF JUDICIAL MAGISTRATE ::
VIJAYAWADA.
Calendar Case No.421 / 2023
Date of Offence:19.10.2019
Date of complaint:21.10.2019
Date of taken on file:03.02.2020
Date of apprehension/:18.07.2022 appearance of accused
Date of commencement:22.08.2023 of trial.
Date of close of trial:01.04.2026
Date of Pronouncement:13.04.2026 of Judgment
Date of sentence of :13.04.2023 Order
Name and Address of the:Kapavarapu Srinivasa Rao, S/o. Nancharaiah, Hindu, aged about 52 Complainant years, R/o. D.No.19-74, Ramachandra Nagar, Kanuru, Penamaluru Mandal, Krishna District, Andhra Pradesh – 520007.
Name and Address of the:Nidumolu Nagarjuna Kumar, S/o. Late N.V.S.V.Pradada Rao, Hindu, Accused aged 35 years, R/o. D.No.13-100, Beside Ashok Locks, Penamaluru Village & Mandal, Krishna District, A.P. - 520007.
Present Address: D.No.20/516-2B-6, NGOS Colony, Parasupet, Machilipatnam, Krishna District, A.P.
Nature of offence/ :Under Section 138 of Negotiable Section of lawInstruments Act.
C.C.No.421 of 2023 36 V ACJM, VJA
Plea of accused:The accused is pleaded not guilty.
Explanation of delay :This case was taken on file on 03.02.2023 U/s.138 of N.I.Act by the learned IV Addl. Metropolitan Magistrate, Vijayawada and numbered as CC.No.781/2020.On 18.07.2022, the accused was present and copies furnished to the accused U/s.207 Cr.P.C. On 17.01.2023 this case was transferred to this Court, as per the orders of Hon’ble District Judge, Machilipatnam in Dis.No.9123dt.14.12.2022and renumbered as CC.No.421/2023. On 17.07.2023, accused was examined U/s.251 Cr.P.C. On 22.08.2023 chief affidavit of complainant in lieu of examination in chief as PW1 was filed. On 29.11.2023 PW.1 was further examined in chief and Exs.P1 to P10 were marked. On 16.04.2024 PW.1 was cross examined in part. On 01.08.2024 PW.1 was cross examined. On 19.08.2024 chief affidavit of witness for complainant in lieu of examination in chief as PW2 was filed and further examined in chief. On 20.09.2024 PW.2 was cross examined and reported no further evidence, hence the evidence of complainant was closed. On 26.09.2024, the accused was examined under Section 313 Cr.P.C and the accused reported defense evidence. On 26.05.2025 on behalf of the accused, the accused himself examined in chief as DW.1 and Exs.D1 to D5 were marked. On 02.09.2025 Dw.1 was further examined in part and Exs.D6 to D10 were marked. On 19.09.2025 DW.1 was further examined. On 15.10.2025 DW.1 was cross examined and Exs.P11 and P12 were marked. On 14.11.2025
C.C.No.421 of 2023 37 V ACJM, VJA
Dw.1 was recalled as per orders dated 14.11.2025. DW.1 was further examined and Exs.D11 and D12 were marked and cross examined. On 21.11.2025 DW.2 was examined in chief. On 21.01.2026 PW.1 was recalled as per orders in
Crl.M.P.No.2711/2025 dated 09.01.2026.
PW.1 was further cross examined. On 21.01.2026 DW.1 was recalled as per orders in Crl.M.P.No.2710/2025 dated 09.01.2026. DW.1 was further examined and Exs.D13 and D14 were marked. The learned counsel for the accused reported no further defence evidence. Hence, the defence evidence was closed and posted for arguments. On 28.01.2026 arguments of the complainant were heard. On 19.02.2026 arguments of the accused were heard and also filed written arguments and posted for judgment. On 06.03.2026 Crl.M.P.Nos. 231/2026 to 233/2026 which were filed on 05.03.2026 by the accused to reopen the case for further defence evidence were allowed on 26.03.2026. On 01.04.2026 DW.1 was recalledasperordersin
Crl.M.P.No.368/2026 dated 01.04.2026.
DW.1 was further examined and Exs.D15 to D19 were marked and defence evidence was closed and posted for arguments. On 07.04.2026 arguments of complainant were heard. Learned counsel for the accused has filed written arguments and posted to 13.04.2026 for judgment. On 13.04.2026 Judgment is pronounced. Hence, the delay.
Finding of the Court:The accused is found guilty.
Sentence of Order:In the result, the accused is found guilty
C.C.No.421 of 2023 38 V ACJM, VJA and he is convicted u/s.255(2) Cr.P.C., and the accused is sentenced to suffer simple imprisonment for a period of SIX MONTHS and also to pay fine of Rs.5,00,000/- (Five Lakhs only) in default of payment of fine the accused shall suffer simple imprisonment for a period of 3 months for the offence punishable under Section 138 of Negotiable Instruments Act.The entire fine amount of Rs.5,00,000/- is awarded to the complainant towards compensation under Section 357 of Code of Criminal Procedure. The complainant is entitled to receive the compensation amount after lapse of appeal time.
V Addl. Chief Judicial Magistrate,
Vijayawada. Copy submitted to:
The Hon’ble I Addl. District and Sessions Judge, Krishna at Machilipatnam.