C.C.No.446 of 2017 1JMFC, TADIPATRI
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IN THE COURT OF THE JUDICIAL MAGISTRATE OF FIRST CLASS,
TADIPATRI.
Present:- Sri M.Anil Kumar Naik,
Judicial Magistrate of I Class, Tadipatri,
Monday, this the 18th day of May, 2026.
C.C.No.446 of 2017
BETWEEN :-
Ambati Ramakrishna Reddy, S/o A.Pulla Reddy, aged about 52 years, residing at D.No.10/28, Main Bazaar, Tadipatri-515411, Anantapramu District.
…Complainant
Vs
1. M/s Vavix Industries Private Limited, Represented by its Director M.Phanidhar, 02, First Floor, SVCS Complex, MLA’s Colony, Road No.12, Banjara Hills, Hyderabad-34.
2. Mukku Phanidhar, S/o M.Shankar, Director, M/s Vavix Industries Private Limited, 02, First Floor, SVCS Complex, MLA’s Colony, Road No.12, Banjara Hills, Hyderabad-34.
3. Mukku Sadasiva Ananda Gajapathi, S/o Father’s name not known, Director, M/s Vavix Industries Private Limited, 02, First Floor, SVCS Complex, MLA’s Colony, Road No.12, Banjara Hills, Hyderabad-34.
…Accused
* * * * *
This Case came before me on 24-04-2026 for Arguments in the presence of Sri U.Surya Prakash and Sri K.Adi Sesha Reddy, Advocates for the Complainant and Sri Y.Sreenivasulu, Advocate for the Accused No.1 to 3 and upon hearing both sides, and having been stood over for consideration till this day, this Court delivered the following:
//J U D G M E N T//
1.This complaint was filed by the Complainant against the Accused No.1 to 3 for the offence punishable under section 138 and 142 of Negotiable In-
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APAN120007082017 struments Act r/w Section 200 of Criminal Procedure Code (Herein after re- ferred as Cr.P.C).
2.The brief facts of the complainant case are as follows:
The complainant, a resident of Tadipatri, Anantapur District, along with
Mrs. Sireesha (sleeping partner), invested Rs.50,00,000 in September 2016 in the DL-RC Project of Jharkhand State through M/s Rosmerta Technologies
Ltd., Hyderabad, by RTGS transfers of Rs.20,00,000 and Rs.30,00,000. Sub- sequently, accused No.1, M/s Vavix Industries Pvt. Ltd., Hyderabad, took over the said project. During discussions, accused No.2, representing accused
No.1, agreed in writing to repay the complainant Rs.50,00,000 in two install- ments Rs.15,00,000 and Rs.35,00,000. In discharge of this liability, accused
No.3, also a Director of accused No.1, issued two cheques dated 10-02-2017 and 10-03-2017 drawn on Bank of Baroda, Hyderabad. When the complainant presented both cheques through SBI, Tadipatri on 25-04-2017, they were dis-
honoured with the endorsement “Opening Balance Insufficient.” Thereafter,
the complainant issued a legal notice dated 19-05-2017 demanding payment, but the accused deliberately avoided service and failed to make payment within the statutory period. Hence, the complaint.
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3.This case has been taken on file by this Court for the offence punishable under Section 138 & 142 of Negotiable Instruments Act, 1881 against the ac- cused and issued summons to them.
4. After appearance of the Accused No.2 to 3, copies were furnished to them as required under section 207 of Criminal Procedure Code (Herein after referred as Cr.P.C).
5.The Accused No.2 and 3 were examined Under Section 251 Cr.P.C for the offence punishable section 138 of Negotiable Instruments Act, its accusa- tion was explained to them in Telugu language, for which they denied, pleaded not guilty and claimed to be tried.
6. To prove the case of the Complainant, he got examined as PW.1 and also examined PW.2 and PW.3, who are Branch Manager of Bank of Baroda and Branch Incharge respectively. Apart from the evidence of PW.1 to 4, he got marked Ex.P.1 to Ex.P.15.
7. After the closure of the prosecution side evidence, the accused were ex- amined under section 313 Cr.P.C by explaining the incriminating material spelt out by the complainant witnesses against them, for which they denied the same and reported defense evidence.
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8.Heard the arguments from both sides and perused the entire material available on record.
9.Now the points for determination are:
1. Whether the accused issued Ex.P4&5/Cheques in favor of the
complainant for discharge of a legally enforceable debt or other
liability?
2. Whether the complainant has complied with all the legal formali-
ties as per the provisions of Sec.138 r/w 142 of Negotiable In
strument Act for presenting the complaint in this Court ?
3. Whether the complainant proved the case against the accused
for the offence punishable Under Section of 138 Negotiable in-
strument Act, beyond all reasonable doubt?
10.In order to prove the case of the complainant and to discharge the initial burden left upon him, the complainant himself examined as P.W.1 and exam- ined PW2 and PW3. Apart from the oral evidence of the complainant and Bank managers, the following documents were marked. Ex.P.1 is the Request letter of Accused No.2, dt. 05.09.2016, Ex.P2 is the Letter by Complainant, Ex.P3 is the Letter of furnish 2 cheques, Ex.P4 is the Cheque bearing No.000054, dt.
10.02.2017, Ex.P5 is the Cheque bearing No.000052, dt. 10.03.2017, Ex.P6 is the Memo of Bank of Baroda, Cheque bearing No.000054, dated 25.04.2017,
Ex.P7 is the Memo of Bank of Baroda, Cheque bearing No.000052, dt.
25.04.2017, Ex.P8 is the Office copy Lawyer notice, dated 19.05.2017, Ex.P9 is the Postal Receipts, dated 12.05.2017, Ex.P10 is the Returned Postal cover
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APAN120007082017 of Accused No.1, dated 26.05.2017, Ex.P11 is the Returned Postal cover of
Accused No.2, dated 26.05.2017, Ex.P12 is the Returned Postal Cover of Ac- cused No.3, dated 26.05.2017, Ex.P13 is the Account Statement of Account
No.00000085530806 SBI, Branch City Centre, Hyderabad, Ex.P14 is the Let- ter of Rosmetra Technologies Limited, Delhi, Dated 21.03.2017 and Ex.P15 is the Attested copy of the Income Tax returns of the Complainant for the assess- ment year 2019-2020.
11. On behalf of the accused, Accused No.2 examined himself as DW1 and
Exhibit D1 was marked on behalf of the accused.
12.While advancing the arguments on behalf of the complainant, the com- plainant contended that, on the request and authorization of Accused No.2 un- der Ex.P1 dated 05.09.2016, he transferred an amount of Rs.50,00,000/- in two installments of Rs.20,00,000/- and Rs.30,00,000/- through banking chan- nels directly to Rosmerta Technologies Limited towards the Jharkhand DL-RC
Project on behalf of Accused No.1 company. It is further submitted that there- after Accused No.2, representing Accused No.1, entered into written under- standing under Ex.P3 agreeing to repay the said amount to the complainant in two installments of Rs.15,00,000/- and Rs.35,00,000/- and pursuant thereto,
Accused No.3, being Director of Accused No.1 company, issued cheque
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Nos.000054 dated 10.02.2017 for Rs.15,00,000/- and 000052 dated 10.03.2017 for Rs.35,00,000/- drawn on Bank of Baroda, Tilak Nagar Branch,
Hyderabad. The complainant presented both cheques through SBI, Tadipatri
Branch, and the same were dishonoured on 25.04.2017 for the reason “Open- ing Balance Insufficient.” Thereafter, statutory legal notice dated 19.05.2017 was issued to all accused, but they failed to make payment within the statutory period. The complainant contended that all mandatory ingredients under Sec- tions 138 and 142 of NI Act are fulfilled, statutory presumption under Sections 118 and 139 NI Act operates in his favour, and accused failed to rebut the same. Hence prayed to convict Accused Nos.1 to 3.
13.Written arguments were filed on behalf of the accused. The learned counsel for accused submitted that there are material contradictions in the complainant’s case regarding Rosmerta Technologies location, date and mode of payment, RTGS/NEFT discrepancies, and absence of legally enforceable debt against Accused Nos.1 to 3. It is contended that the complainant admit- tedly transferred money to Rosmerta Technologies Limited and not to accused personally or to Accused No.1 company account. Therefore, no direct legally enforceable liability exists. It is further contended that Ex.P13 bank statement
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APAN120007082017 is inadmissible for want of certificate under Bankers’ Books Evidence Act and
Ex.P1 and Ex.P3 are fabricated documents.
14.The learned counsel for accused further submitted that there are no specific averments in the complaint showing how Accused Nos.2 and 3 were in charge of and responsible for conduct of business of Accused No.1 com- pany as required under Section 141 NI Act. Merely describing them as Direc- tors is insufficient. It is also argued that the complainant himself admitted there was no agreement with Rosmerta Technologies, while Ex.P14 creates doubt regarding complainant’s conduct and alleged unlawful interest.
15.The learned counsel for accused further submitted that Ex.P3 contains contradictions regarding cheque numbers, dates, and amounts, creating seri- ous doubt about its genuineness. It is further argued that there was material alteration in one cheque without drawer authentication and such alteration ren- ders cheque void under Section 87 of NI Act. The accused also contended that the complainant failed to prove financial capacity, source of funds, and valid authority, and therefore statutory presumption stands rebutted.
16.Lastly, the learned counsel for accused submitted that the complainant’s case is purely civil in nature arising out of alleged business arrangement and
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APAN120007082017 not criminal liability under Section 138 NI Act. Hence prayed for dismissal of complaint and acquittal of accused.
17.After hearing the arguments advanced on behalf of both parties and pe- rusing the entire oral and documentary evidence on record carefully, the ap- preciation of evidence and findings of this court are as follows.
18.It would be apposite to first consider the legal position serving as base to the offence underlying Section 138 NI Act. The following legal requirements need to be satisfied in order to constitute an offence u/s 138 NI Act, as held by
Hon'ble Supreme Court in the case titled as Kusum Ingots & Alloys Ltd. v. M/s
Pennar Peterson Securities Ltd. (2000) 2 SCC 745.
(i) that a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account for the discharge of any debt or other liability;
(ii) that 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;
(iii) that the cheque is returned by the bank unpaid either because of the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank;
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(iv) that the payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
(v) that the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice;
The above legal requirements are cumulative, meaning thereby that only if all the aforementioned ingredients are satisfied can the person who had drawn the cheque be held liable for offence u/s 138 NI Act.
19.Burden of proof:-
The claim based under the provisions of Negotiable Instruments Act is an exception to the general rule of law that burden of proof lies on the prosecution. The two specific provisions viz. Section 118 (a) and 139 of NI Act contemplates that a presumption is attached in regard to each and every negotiable instrument that the same was drawn and issued against due discharge of the liability and thus, whenever any claim is made on the basis of a negotiable instrument, the presumption has to be drawn in favour of the holder of the cheque (drawee) and the law has put the burden to rebut the presumption on the accused that the cheque was not issued by them against discharge of a debt or a liability. In case, the accused is not able to rebut the
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APAN120007082017 presumption and fails to prove their defence, the presumption becomes absolute and it has to be assumed that the cheque was issued by the accused in discharge of debt or liability and consequently, accused is assumed guilty of the offence. It was held by Hon'ble Supreme Court in the case of Rangappa vs
Mohan: 2010 (11) SCC 441 that presumption of Section 139 of N.I. Act also includes the existence of legally enforceable debt.
20.It is a well settled principle of criminal jurisprudence that a criminal trial proceeds on the presumption of innocence of the accused i.e. an accused is presumed to be innocent unless proved guilty. Thus, normally the initial burden to prove the guilt of the accused lies on the complainant/prosecution
Also, the standard of proof is beyond reasonable doubt. However, in offences under section 138 of the Act, there is a reverse onus clause contained in sections 118 and 139 of the Act.
21.Section 118(a) of the Act provides that until the contrary is proved, it shall be presumed that "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."
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22.Further, Section 139 of the Act lays down that "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.On bare reading of these provisions, it becomes clear that the court shall presume the execution of a negotiable instrument for consideration unless and until the contrary is proved. Similarly, the Court shall also draw a presumption in favour of the complainant/holder of the cheque that the said cheque has been issued in discharge of legally enforceable debt or other liability.
24.There is a statutory presumption under section 139 of the act which arises in the favour of the complainant. This presumption is rebuttable and the accused is required to raise a probable defence. Burden of proof is hence upon the accused in such cases.
25.It is also a settled proposition of law that the standard of proof which is required from the accused to rebut the statutory presumption under section 118 read with section 139 of the Act is preponderance of probabilities. The accused are not required to prove their case beyond reasonable doubt. This
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APAN120007082017 onus on the accused can be discharged from the materials available on record and from the circumstantial evidences. It should also be noted that the standard of proof in order to rebut the statutory presumption may be inferred from the materials on record and circumstantial evidences. It is not always mandatory for the accused to examine its own witnesses in order to rebut the said statutory presumption.
26.Thus, section 139 of the Act puts the burden on the accused to prove their defence. However, the accused has to prove their defence on the balance of probabilities and not beyond reasonable doubt. Accused can prove their defence by drawing inferences from the materials already on record (including complainant's evidences), circumstances of the case and also leading their own evidences. If the accused successfully creates doubts in the complainant's claim about the existence of legally enforceable debt then the burden of proof shifts back to the complainant who is required to prove the guilt of the accused beyond reasonable doubt.
27.Point No.1:-
As discussed in the preceding paragraphs, there is statutory presumption under section 118(a) and 139 of the Act in favour of complainant regarding the following aspects:-
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1. That the impugned cheque was issued by the accused for consideration,
2. That there exists a legally enforceable debt in favour of the complainant and
3. That the impugned cheque have been issued in discharge of a legally enforceable debt.
28.Therefore, the burden of proof lies on the accused to prove the contrary.
The standard of proof required by the accused is based on preponderance of probabilities which means that the accused are only required to create doubt in the complainant's claims and are not required to prove their own defence beyond reasonable doubt. The accused can examine their witnesses or file their own evidences for this purpose. They can even draw inferences from the evidences filed on record by the complainant in order to create doubts in the complainant's claims.
29.Before adverting to the rival contentions, this court deems it appropriate to examine each specific defence raised by the accused in light of the pleadings, oral evidence of PW1 and DW1, documentary evidence Ex.P1 to
Ex.P15, and the settled legal principles governing Sections 138 and 141 of
Negotiable Instruments Act. Since the accused attempted to rebut statutory presumptions by pointing out alleged contradictions, procedural defects, and legal infirmities, each such defence requires independent consideration.
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30.At the outset, it is an admitted and undisputed fact emerging from the record that Ex.P4 and Ex.P5 cheques belong to Accused No.1 company account maintained with Bank of Baroda, Tilak Nagar Branch, Hyderabad, and that the said cheques bear signatures of Accused No.3. Dishonour of both cheques under Ex.P6 and Ex.P7 for the reason “Opening Balance Insufficient” is also admitted. DW1 himself admitted during cross-examination that the cheques were dishonoured for insufficiency of funds. Therefore, the foundational requirements for invocation of Sections 118(a) and 139 NI Act stand established. Once issuance/signature is admitted or proved, the statutory presumption regarding legally enforceable debt immediately operates in favour of complainant unless rebutted by probable defence.
31.The first defence raised by accused is that the complainant transferred
Rs.50,00,000/- to Rosmerta Technologies Limited and not to Accused Nos.1 to 3, and therefore no legally enforceable liability exists against accused. This contention, though attractive at first glance, is unsustainable when Ex.P1 and
Ex.P3 are read together. Ex.P1 specifically contains request by Accused No.2 on behalf of Vavix Industries Pvt. Ltd. requesting complainant to directly remit
Rs.50,00,000/- to Rosmerta for Jharkhand Project, clearly stating that complainant shall not claim from Rosmerta and that Vavix Industries Pvt. Ltd.
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APAN120007082017 shall settle all claims directly. Thus, Ex.P1 itself creates privity of obligation between complainant and accused. Ex.P3 further strengthens this by recording written understanding whereby accused agreed to repay
Rs.50,00,000/- to complainant in two installments. Therefore, even though payment was routed to Rosmerta, liability was expressly undertaken by accused. Under law, consideration may move to third party so long as liability is assumed by drawer. Hence, this defence fails.
32.The accused repeatedly attempted to benefit from discrepancy regarding Rosmerta being described as Hyderabad, Gurgaon, Delhi, or Noida.
In commercial reality, confusion regarding branch or office location of a corporate entity does not negate transaction itself, particularly when identity of
Rosmerta Technologies Limited remains constant throughout and Ex.P14 itself confirms Rosmerta’s dealings with accused. The complainant is not required to prove exact registered office location of Rosmerta to sustain
Section 138 prosecution against cheque drawer. This discrepancy is merely descriptive and not material. Criminal jurisprudence distinguishes between minor descriptive irregularities and contradictions going to root of liability. This discrepancy does not affect core case.
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33.The accused further argued discrepancy between RTGS and NEFT references. Banking terminology, narration style, or transfer classification does not disprove payment when transfer itself is admitted. Ex.P13, complainant’s bank statement, and admissions in evidence sufficiently establish transfer of
Rs.50,00,000/-. More importantly, DW1 admitted knowledge of such transfer in chief examination, though later vacillated in cross-examination. Once factum of transfer is substantially admitted, technical nomenclature differences between RTGS and NEFT are inconsequential.
34.The accused challenged admissibility of Ex.P13 bank statement for want of certificate under Bankers’ Books Evidence Act. Even assuming technical defect, this objection does not demolish complainant’s case because the transfer itself is corroborated by Ex.P1, Ex.P2, Ex.P3, Ex.P14, and DW1’s own admissions. It is settled law that admitted facts need not be independently proved. Moreover, accused never specifically denied receipt of benefit arising from complainant’s transfer, rather, defence was that cheques were allegedly given to Rosmerta. Thus, Ex.P13 is corroborative, not foundational.
35.The defence that Ex.P1 is forged was raised by DW1, but significantly, accused never sought handwriting expert opinion, never invoked Section 73
Evidence Act, never lodged police complaint alleging forgery, and never
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APAN120007082017 initiated criminal proceedings against complainant for fabrication. Bare denial without substantive challenge carries little evidentiary value. When a businessman of MBA qualification alleges forged commitment letter involving
Rs.50 lakhs but takes no legal action, such conduct militates against normal human behaviour. Therefore, this defence appears as afterthought.
36.The accused relied upon absence of specific averments under Section 141 NI Act against Directors. This court carefully examined complaint averments. Complaint specifically states Accused No.2 negotiated, undertook liability, executed understanding on behalf of company, and Accused No.3 issued cheques for and on behalf of company. Thus, unlike bald mechanical pleading, present complaint discloses distinct roles. The judgments in A.K.
Singhania Vs Gujarat State Fertilizer Company Limited and another 2014 AIR 71 and Pooja Ravinder Devidharshini Vs State of Maharastra (2015) AIR (SC) 675, and Pooja Ravinder Devidasani are inapplicable because those cases dealt with directors arrayed solely by designation without specific transactional role. Here, Accused No.2 is principal actor and Accused No.3 is cheque signatory, therefore, statutory requirements are satisfied.
37.The defence based on father’s name error of Accused No.2 in complaint/legal notice is wholly hyper-technical. Identity of accused was never
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APAN120007082017 in doubt. Accused appeared, contested proceedings, examined himself, and never demonstrated prejudice due to such clerical error. Mere misdescription or typographical error does not vitiate proceedings unless prejudice is shown.
38.The accused argued that complainant and Sireesha were partners of unregistered firm and therefore complaint is barred. This defence is misconceived. Present prosecution is not by unregistered partnership firm for enforcement of contractual rights under Section 69 Partnership Act, it is by payee/holder of cheque under Section 138 NI Act. The cheques Ex.P4 and
Ex.P5 are drawn in favour of complainant personally. Therefore, cited ruling regarding unregistered firm is factually distinguishable.
39.The defence regarding absence of separate NOC under Ex.P3 is similarly weak. Ex.P3 itself records understanding and conditions of no further claim upon clearance of cheques. Whether separate NOC was later issued becomes irrelevant when cheques themselves were dishonoured. Obligation to issue NOC was contingent upon cheque clearance. Since cheques bounced, non-issuance of NOC does not invalidate liability.
40.The accused heavily relied on alleged contradictions in cheque numbers and handwritten corrections in Ex.P3. Commercial documents often contain
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APAN120007082017 clerical corrections. The relevant issue is whether actual cheques Ex.P4 and
Ex.P5 were issued, presented, and dishonoured. Both cheques are physically
before court. Bank returned them for insufficiency of funds, not for mismatch,
fabrication, or invalidity. Therefore, minor drafting irregularities in Ex.P3 do not outweigh actual issuance and dishonour of cheques.
41.The defence of material alteration under Section 87 of NI Act was based on alleged month correction. However, the most crucial fact is that drawee bank did not dishonour cheque on ground of material alteration, rather, return reason was “Opening Balance Insufficient.” If alteration were fatal, bank would ordinarily return under alteration objection. This substantially weakens accused’s contention of materrial alteration.
42.The accused’s most prominent defence was that blank cheques were given to Rosmerta under pressure and complainant misused them through political influence. This defence collapses under scrutiny. DW1 gave shifting stands, first denying knowledge of complainant, then admitting awareness of complainant’s transfer by saying blank cheques, then “some cheques,” then “three cheques,” then no details of cheque numbers/dates, alleging BJP
Political influence and alleging Rosmerta misuse without police report. Such contradictory, unsupported allegations are insufficient to rebut statutory
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APAN120007082017 presumption. Mere story without documentary foundation does not constitute probable defence.
43.Cross-examination of DW1 further reveals that though he claimed
Rosmerta misused cheques, he neither issued stop payment instructions nor filed complaint against Rosmerta and complainant. A prudent businessman would act immediately if signed blank cheques worth Rs.50 lakhs were misused. Silence speaks against defence credibility.
44.The accused relied Basalingappa vs Mudibasappa AIR 2019 SC 1983 regarding contradictions in complainant’s version. The principle is correct that material contradictions may rebut presumption. However, Basalingappa case does not assist accused where contradictions are peripheral and core transaction stands proved. In present case, complainant’s core case remained consistent. Accused requested transfer, complainant paid Rs.50 lakhs, accused issued two cheques, cheques dishonoured. Variations regarding location descriptors, terminology, or clerical details do not strike root of transaction.
45.The accused also relied Kumar Exports vs Sharma Carpets AIR 2009
SC 1518. That judgment actually reiterates that accused must raise probable
defence. Here, accused failed to substantiate blank cheque theory, forgery
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APAN120007082017 allegation, or absence of liability through cogent evidence. Therefore, Kumar
Exports case ultimately supports complainant once defence remains speculative.
46.The argument that Ex.P3 creates only civil liability is legally incorrect. A transaction may simultaneously create civil liability and criminal consequences if cheque issued towards such liability is dishonoured. Section 138 is attracted when cheque is issued for legally enforceable liability, irrespective of whether original liability arose from business, loan, guarantee, or settlement.
47.The complainant’s cross-examination does disclose certain inconsistencies and broad language, but none sufficient to destroy prosecution. Though Ex.D1 is marked on behalf of the Accused, nothing was rebutted that the said document. PW1 consistently maintained that Rs.50 lakhs were transferred on accused request and accused issued cheques in repayment. Minor omissions, language imperfections, or imprecise descriptions are natural in lengthy commercial disputes and do not by themselves rebut statutory presumptions.
48.On cumulative appreciation, this court finds that accused has magnified minor discrepancies while failing to answer major incriminating circumstances
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APAN120007082017 forming Ex.P1 request letter, Ex.P3 repayment understanding, admitted dishonoured cheques, insufficiency memos, absence of defence documents, contradictory DW1 testimony, and lack of legal action regarding alleged misuse.
49.Therefore, this court holds that the defences raised by accused are either hyper-technical, unsupported and insufficient to rebut presumptions under Sections 118 and 139 NI Act. The accused has failed to establish probable defence on preponderance of probabilities.
50.Consequently, statutory presumptions remain unrebutted, and complainant has successfully proved that Ex.P4 and Ex.P5 were issued by accused towards discharge of legally enforceable liability. Accordingly, the point is answered against the accused and in favour of the complainant.
Point No.2:
51.As per the evidence of PW.1 to PW.3, after the dishonour of Ex.P4 and
P5 cheques, the complainant got issued legal notice to the accused on 19.05.2017 as required u/sec.138 of N.I. Act and the same were returned to the complainant on 26.05.2017 under Ex.P10 to Ex.P12. It is not the contention of the defense that the complainant has not presented Ex.P4 and
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P5 cheques and they were not dishonoured with a reason "Opening Balance
Funds Insufficient" in the bank account of the accused. Moreover the defense is not disputed about the Insufficient funds in the bank account of the accused by the date of presentation Ex.P4 and P5 cheques.
52.Thus under these circumstances in view of the foregoing reasons and crystallized legal possession, without any hesitation it is held that the accused are unsuccessful to rebut the presumption which raised in favour of the complainant u/sec.139 of N.I. Act.
53.On summing up the entire evidence let before this court, it is very clear that except putting some formal suggestions from side of defense nothing was elicited from PW.1 to PW.3 to disbelieve the complainant claim. The defense failed to shake the credibility of the evidence of PW.1 to PW.3. Moreover, the plea raised by the defense have no consistency and the accused failed to prove how Ex.P4 and P5 cheques belongs to A1 company came into the hands of the complainant. Thus, it is evident that the defense has not raised a proper and probable defense to the extent of disbelieving the case of the complainant. Accordingly the point No.2 is answered in favour of the complainant and against the accused.
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Point No.3
54.In view of the discussion in points No.1 and 2, in the facts and circumstances of the case this court is of the considered opinion that the complainant was proved the case against the accused for the offence punishable u/sec.138 of N.I. Act beyond reasonable doubt. This point is answered in favour of the complainant and against the accused.
55.In the result, the Accused No.1 Company is found guilty for the offence punishable under section 138 of Negotiable Instruments Act and Accused
No.2 and 3 being the managing directors of Accused No.1 Company are vicar- iously liable for the offence committed by Accused No.1 company and accord- ingly they are convicted under section 255(2) of Cr.P.C.
Typed to my dictation by the Stenographer, corrected and pronounced by me in the open court, this the 18th day of May, 2026.
Sd/- Sri M.Anil Kumar Naik,
Judicial Magistrate of I Class,
Tadipatri.
56.Keeping in view of the nature of the offence that, it is a financial transaction and in the facts and circumstances of the case, this court is of the opinion that this is not a fit case for applying the provisions of Sec.360 Cr.P.C., or the provisions of probation of offenders Act, 1958.
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57.The Accused No.2 is questioned with regard to quantum of sentence to be imposed against him. The accused No.2 stated that, he did not issue cheques for discharge of legally enforceable debt and further stated that he is suffering with fits. Accused No.3 is questioned with regard to quantum of sentence to be imposed against him. The Accused No.3 stated that, he is aged about 71 years and suffering heart disease and entire family depends on him. Both the accused pleaded mercy from this court. Considering the submissions of the Accused No.2 and 3 and also the facts and circumstances of the case, I feel that lenient view can be taken in this case. I take lenient view.
58.The Accused No.2 and 3 are sentenced to undergo Simple imprisonment for a period of Six months for the offence Punishable under section 138 of Negotiable Instruments Act, 1881. Further the Accused No.2 and 3 shall pay an amount of Rs.50,00,000/- being the cheques amount to the complainant towards compensation under section 357(3) Cr.P.C., within six (6) months from today, in default of payment of compensation to undergo simple imprisonment for a period of Two (2) months.
59.The remand period of Accused No.2 and 3 if any shall be set off under section 428 of Cr.P.C.
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60.The Accused No.2 and 3 are appraised of their right of appeal and also availability of free legal aid for the purpose of preferring an appeal against this judgment.
Typed to my dictation by the Personal Assistant, corrected and
pronounced by me in the open court, this the 18th day of May, 2026.
Sd/- Sri M.Anil Kumar Naik,
Judicial Magistrate of I Class,
Tadipatri.
APPENDIX OF EVIDENCE
Witnesses examined:-
For Complainant:- For Accused:
PW.1: A.Ramakrishna Reddy DW.1: M.Phanidhar PW.2: M.Pavan Kumar PW.3: Y.Chandrasekhar Reddy
Exhibits marked for Complainant:- Ex.P.1:- Request letter of Accused No.2, dt. 05.09.2016,
Ex.P2:- Letter by Complainant,
Ex.P3:- Letter of furnish 2 cheques,
Ex.P4:- Cheque bearing No.000054, dt. 10.02.2017,
Ex.P5:- Cheque bearing No.000052, dt. 10.03.2017,
Ex.P6:- Memo of Bank of Baroda, Cheque bearing No.000054, dated 25.04.2017,
Ex.P7:- Memo of Bank of Baroda, Cheque bearing No.000052, dt. 25.04.2017,
Ex.P8:- Office copy Lawyer notice, dated 19.05.2017,
Ex.P9:- Postal Receipts, dated 12.05.2017,
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Ex.P10:- Returned Postal cover of Accused No.1, dated 26.05.2017,
Ex.P11:- Returned Postal cover of Accused No.2, dated 26.05.2017,
Ex.P12:- Returned Postal Cover of Accused No.3, dated 26.05.2017,
Ex.P13:- Account Statement of Account No.00000085530806 SBI, Branch City Centre, Hyderabad,
Ex.P14:- Letter of Rosmetra Technologies Limited, Delhi, Dated 21.03.2017
Ex.P15:- Attested copy of the Income Tax returns of the Complainant for the assessment year 2019-2020.
For Accused:-
-Nil- Id/- M.A.K.N. JMFC, TDP.
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IN THE COURT OF JUDICIAL MAGISTRATE OF THE FIRST CLASS
TADIPATRI.
CALENDER IN C.C.No.446 of 2017
Date of Offence:10.02.2017 & 10.03.2017 Date of Complaint :19.06.2017 Date of Apprehension of Accused: ---------- Date of Released of Accused: ---------- Date of Commencement of trial :26.07.2022 Date of Closure of trial:29.03.2023 Date of Sentence / Order:18.05-2026 Between:
Ambati Ramakrishna Reddy, S/o A.Pulla Reddy, aged about 52 years, residing at D.No.10/28, Main Bazaar, Tadipatri-515411, Anantapramu District.
….Complainant.
Vs.
1. M/s Vavix Industries Private Limited, Represented by its Director M.Phanidhar, 02, First Floor, SVCS Complex, MLA’s Colony, Road No.12, Banjara Hills, Hyderabad-34.
2. Mukku Phanidhar, S/o M.Shankar, Director, M/s Vavix Industries Private Limited, 02, First Floor, SVCS Complex, MLA’s Colony, Road No.12, Banjara Hills, Hyderabad-34.
3. Mukku Sadasiva Ananda Gajapathi, S/o Father’s name not known, Director, M/s Vavix Industries Private Limited, 02, First Floor, SVCS Complex, MLA’s Colony, Road No.12, Banjara Hills, Hyderabad-34.
.......Accused.
Offence: U/s 138 of NI Act Finding: The Accused No.1 to 3 are found guilty. Sentence: In the result, the Accused No.2 and 3 are found guilty for the offence punishable u/sec.138 of Negotiable Instruments Act, and they are convicted u/sec.255 (2) of Cr.P.C.
The Accused No.2 is questioned with regard to quantum of sentence to be imposed against him. The accused No.2 stated that, he did not issue
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Accused No.3 is questioned with regard to quantum of sentence to be imposed against him. The Accused No.3 stated that, he is aged about 71 years and suffering heart disease and entire family depends on him.
And both the accused pleaded mercy from this court. Considering the submissions of the Accused No.2 and 3 and also the facts and circumstances of the case, I feel that lenient view can be taken in this case. I take lenient view.
The Accused No.2 and 3 are sentenced to undergo Simple imprisonment for a period of Six months for the offence Punishable under section 138 of Negotiable Instruments Act, 1881. Further the Accused No.2 and 3 shall pay an amount of Rs.50,00,000/- being the cheques amount to the complainant towards compensation under section 357(3) Cr.P.C., within six (6) months from today, in default of payment of compensation to undergo simple imprisonment for a period of Two (2) months.
The remand period of Accused No.2 and 3 if any shall be set off under section 428 of Cr.P.C.
The Accused No.2 and 3 are appraised of their right of appeal and also availability of free legal aid for the purpose of preferring an appeal against this judgment.
Sd/- Sri M.Anil Kumar Naik,
Judicial Magistrate of I Class,
Tadipatri.
Copy to: The Hon’ble I Addl. District & Sessions Judge, Ananthapuramu.