M.Seshanjaneyulu

S.M.C., Ndl. 1 C.C.642/2008

IN THE COURT OF THE SPECIAL MAGISTRATE : NANDYAL

Present:-Sri M.Seshanjaneyulu, Special Magistrate.

Friday,the 24 th day of November,2017

C.C.No.642/2008

G.Rajasekhar Reddy,s/o.Subba Reddy,aged 42 years,Hindu,Business,Resident of H.No.

30/49/1,Polytechnic College Road,Nandyal town

And Mandal,Kurnool District. Complainant.

Versus

Raavi Vani,w/o.Pradeep,aged 39 years,Hindu

Resident of D.No.16-7-16,Veera Raghavulu street

Salt Bazar.Tenali Town,Guntur District. Accused

This case coming on 05-10-2017 for final hearing before me in the presence of Sri B.Sankaraiah, Advocate for thecomplainant and of Sri K.Sreenivasulu and Sri S.M.Naidu, Advocates for the

Accused and having stood over for consideration till this day, the court delivered the following:-

J U D G M E N T

1.This is a Private Complaint filed under Sec.200 Cr.P.C. against the accused for the offence punishable under section 138 of N.I.

Act with the following allegations:-

The accused approached the Complainant and borrowed an amount of Rs.5,00,000/- from the Complainant on 10-05-2006 and executed a pronote in favour of the complainant on the same day.

In that connection accused had issued two cheques bearing

Nos.(1)243036 dt.15-01-2008 for Rs.1,00,000 of UTI Bank Ltd.

Tenali and (2)230048 dated 31-1-2008 for Rs.2,50,000/-of UTI

S.M.C., Ndl. 2 C.C.642/2008

Bank,Ltd.,Tenali in favour of the complainant and on that the

Complainant has presented the said Cheques in Indian Bank,

Nandyal, for collection on 15-07-2008. The said two cheque were returned on 18-07-2008, for the reason ”FUNDS INSUFFICIENT”

On that, within 30 days of the receipt of the information of dishonour of cheques by the Indian Bank, Nandyal the complainant had issued legal notice dtd.09-08-2008 calling upon the accused to pay the cheque amount within 15 days from the date of receipt of notice by Regd.post with ack. due and the said notice was served on the accused on 10-08-2008. The accused intentionally evaded the payment and in spite of giving notice by the complainant, the accused did not choose to pay the amount.

Hence the complaint.

3. The case was taken on file for the offence under Section 138 of the Negotiable Instrument Act against the accused.

4. When the Accused appeared before the Court copies of all the documents on which the complainant relied were supplied to her.

5. When examined under section 251 Cr.P.C.by putting the substance of the accusations leveled against her, she denied the same, pleaded not guilty and claimed to be tried.

6. In support of his case, the complainant examined himself as

P.W.1 and examined P.Ws. 2 and 3 Bank officials and marked

Exs.P1 to P10.

7. In support of accused, she himself examined as D.W-1 and marked Exs.D-1.

S.M.C., Ndl. 3 C.C.642/2008

8. After closure of evidence on behalf of the complainant, the accused was called upon to explain the incriminating material appearing against them in the evidence of P.Ws.1 to P.W-3.U/sec.

313(1)(b) Cr.P.C. she denied the offence.

9. The learned Complainant's counsel made the following submissions:-”. The accused approached the Complainant and borrowed an amount of Rs.5,00,000/- from the Complainant on 10-05-2006 and executed a pronote in favour of the complainant on the same day. In that connection accused had issued two cheques bearing Nos.(1)243036 dt.15-01-2008 for Rs.1,00,000 of

UTI Bank Lltd.Tenali and (2)230048 dated 31-1-2008 for

Rs.2,50,000/-of UTI Bank, Ltd., Tenali in favour of the complainant and on that the Complainant has presented the said

Cheques in Indian Bank, Nandyal, for collection on 15-07-2008.

The said two cheque were returned on 18-07-2008, for the reason ”FUNDS INSUFFICIENT” On that, within 30 days of the receipt of the information of dishonour of cheques by the Indian

Bank,Nandyal the complainant had issued legal notice dtd.09-08- 2008 calling upon the accused to pay the cheque amount within 15 days from the date of receipt of notice by Regd.post with ack.

due and the said notice was served on the accused on 10-08- 2008. The accused intentionally evaded the payment and in spite of giving notice by the complainant, the accused did not choose to pay the amount.

10. The defence counsel did not turn up to argue the matter.

S.M.C., Ndl. 4 C.C.642/2008

11. Now, the point for consideration in this case is whether the complainant has proved the guilt of the accused beyond all reasonable doubt for the offence under Sec.138 of the Negotiable

Instruments Act?

12. Since the case of the accused is of total denial, the initial burden is on the complaint to prove the necessary facts for raising the presumptions under Sec.118 and 139 of the Act. For that purpose, the complainant as P.W-1 stated that The accused approached the Complainant and borrowed an amount of

Rs.5,00,000/- from the Complainant on 10-05-2006 and executed a pronote in favour of the complainant on the same day. In that connection accused had issued two cheques bearing

Nos.(1)243036 dt.15-01-2008 for Rs.1,00,000 of UTI Bank

Lltd.Tenali and (2)230048 dated 31-1-2008 for Rs.2,50,000/-of UTI

Bank,Ltd.,Tenali in favour of the complainant and on that the

Complainant has presented the said Cheques in Indian Bank,

Nandyal, for collection on 15-07-2008. The said two cheque were returned on 18-07-2008, for the reason ”FUNDS INSUFFICIENT” On that, within 30 days of the receipt of the information of dishonour of cheques by the Indian Bank,Nandyal the complainant had issued legal notice dtd.09-08-2008 calling upon the accused to pay the cheque amount within 15 days from the date of receipt of notice by Regd.post with ack. due and the said notice was served on the accused on 10-08-2008. The accused intentionally evaded the payment and in spite of giving notice by the complainant, the accused did not choose to pay the amount.

S.M.C., Ndl. 5 C.C.642/2008

13. He is relying on Exs.P-1 to Ex.P-10.

Ex.P-1 is the Dishonoured Cheque No.243036 dt.15-01-2008 for

Rs.1,00,000/-

Ex.P-2 is the cheque bearing No.230048 dt.31-03-2008 for

Rs.2,50,000

Ex.P-3 is the Original return memo issued by Indian Bank,Nandyal dt.18-07-2008

Ex.P-4 is the office copy of legal notice dt.09-08-2008

Ex.P-5 is the original Acknowledgment

Ex.P-6 is the Original Registered postal receipt.

Ex.P-7 is the Promissory note executed by the accused in favour of the Complainant for Rs.5,00,000/- dt.10-05-2006

Ex.P-8 is certified copy of the decree in O.S.140/2009 on the file of

II Addl.Senior Civil Judge Nandyal dt.26-11-2009

Ex.P-9.Statement of Account.

Ex.P-10.Relevant entry in page No.3 of P-9.

14. In support of his case ,the Complainant examined P.W-2 and

P.W-3 Branch Manager of Indian Bank,Nandyal and Senior Manager of Axis Bank,Nandyal.

15. P.W-2 is A.Musalaiah,Branch Manager of Indian Bank,Nndyal.

As per his evidence the complainant is having an Account

No.500242204. G.Raja Sekhar Reddy presented the cheques in their bank on 15-07-2008. The cheque Nos are 1.243036 dt.15- 01-2008 i.e., Ex.P-1 for Rs.1,00,000 and (2) 230048 dt.31-01- 2008 for Rs.2,50,000/- i.e., Ex.P-2. Both the cheques were transmitted to Tenali,UTI Bank. On the letter issued from UTI

S.M.C., Ndl. 6 C.C.642/2008

Bank,Tenali that “FUNDS ARE INSUFFICIENT’ in the name of R.Ravi

Vani. On 18-07-2008 their Bank informed the same to Raja Sekhar

Reddy that Funds are insufficient in the name of Ravi Vani. Two cheques were returned to Raja Sekhar Reddy.

16. P.W-3 is J.Kesava Raj. As per his evidence he is Senior

Manager in Axis Bank,Nandyal for the past 2 years. In the year 2007 U.T.I. Bank changed its name as “Axis Bank”. To have its brand name. Due to that reason the name was chaned. Indian

Bank,Nandyal sent two cheques i.e., 243036 for Rs.1,00,000/- and another cheque No.230048 for Rs.2,50,000/- were sent to their

Bank for clearance. The said two cheques were returned as “Insufficient Funds” in the name of Ravi Vani. She maintains account bearing No.5560101000005920. The reason for change of

A/C.No.070010100133739 changed into 556010100005920, for the reason that the account was originally held with Tenali Branch,

Extension counter of Guntur Branch. Later on Tenali Extension counter got converted to the full fledged branch”. The said chnge of

A/C. number is with the consent of the customer. The memo issued by Indian Bank as “Insufficient Funds” same is replica of memo,that “Insufficient Funds” in the account of Ravi Vani. The said cheques were returned on 15-07-2007. Ex.P-9 is the statement of account.Ex.P-10 is the relevant entry in page No.3 of Ex.P-9.

17. Refuting the evidence of P.Ws.1 to 3 the accused Raavi Vani examined herself as D.W-1. As per her evidence since 1980 she knows P.W-1 who is her friend. She was maintaining one non governmental organization named BHARATI MAHILA MUTUALLY

S.M.C., Ndl. 7 C.C.642/2008

AIDED COOPPERATIVECREDIT AND THRIFT SOCIETY AT TENALI

prior to this case. P.W-1 also maintained one non Govoernmental organization named SRI SIVA SHANKAKR EDUCATIONAL 7 RURAL

INTEGRATED DEVELOPMENT SOCIETY AT NANDYAL. They worked untidily for getting funds to their organizations. In these circumstances, financial transactions were occurred between her and P.W-1. For which on 10-05-2006 she issued one signed empty promissory note and two signed blank cheques bearing No.243036 and 230048 to P.W-1. On 07-06-2007 she paid Rs.4,50,000/-to

P.W-1 as full and final settlement at Tenali towards the above said one signed empty promissory note and two signed cheques bearing

No.243036 and 230048. At that time P.W-1 stated that the above said signed empty promissory note and two signed blank cheques bearing No.243036 and 230048 were misplaced and he will return the same whenever they were traced out. For which P.W-1 issued receipt on his letter head. It is her further case that after some time disputes arose between them. The above said signed empty promissory note and two signed blank cheques bearing Nos.243036 and 230048 were filled by P.W-1 and filed a false case against her for wrongful gain. The said promissory note is marked as Ex.P-7 and two cheques were marked as Exs.P-1 and P-2. There is no legally enforceable debt in this case and she has not committed any offence under section 138 of N.I.Act. She filed one receipt which was issued by P.W-1 dated 07-06-2007 which is marked as Ex.D-1.

She did not receive any information from P.W-3 about the change of her account from U.T.I.Bank,Tenali to Axis Bank. P.W-3 did not file

S.M.C., Ndl. 8 C.C.642/2008 any evidence about the change of her account from

U.T.I.bank,Tenali to Axis Bank. At the instigation of P.W-1,both

P.Ws.2 and 3 falsely deposed against her.

18. I have perused the case record. The accused filed

Crl.M.P.3281/2014 u/sec.45 of Indian Evidence Act to send Ex.D-1

document dated 7-06-2007 for expert opinion. The said Crl.M.P.

was dismissed by holding that at the belated stage the plea taken by the accused to send Ex.D-1 receipt for comparison of signature alleged to have been signed by the Complainant i.e.,P.W-1 along with admitted signature that is found either on the vakalat or chief examination of the complainant. Later, she approached the Hon’ble

High Court. The Hon’ble High Court passed an order in

Crl.M.P.568/2015 by setting aside the order of this Court and to

send the admitted signature of the complainant either in the vakalat or chief examination along with Ex.D-1 receipt. On forwarding the same, the Handwriting expert is directed to give his opinion within a period of two months thereafter. This order was received by this Court on 4-07-2016. The said order of Hon’ble

High Court was not submitted to this Court either by the accused or by her counsel. When she approached the Hon’ble High Court she ought to have appeared before this Court to get N.B.W.re- called and seek permission of this Court to send Ex.D-1 receipt for comparison of signature alleged to have been signed by the

Complainant i.e.,P.W-1 along with admitted signature that is found either on the vakalat or chief examination of the complainant.

S.M.C., Ndl. 9 C.C.642/2008

This Court finds that Ex.P-1 cheque is supported by legally enforceable debt owed by the accused to the Complainant. Since she has executed the promissory note in favour of the complainant on 10-05-206 and receiving the amount, later, on demand he has issued a cheque. Further, the complainant as P.W-1 has filed the office copy of legal notice dt.09-08-2008 got issued by him to the accused. Therefore, there is no escape from the conclusion that the complainant had not complied with the requirement of giving notice in terms of clause (b) of proviso to Sec.138 of the Act.

Hence, I am of the opinion that there is a valid compliance of the statutory requirement of issuing notice to the accused. 24.

After bouncing of the cheque, undisputedly, statutory notice under Ex.P-4 has been issued by the Complainant to the accused’s correct address, that she received the said notice. This is another factor which strengthens the case of the complainants and leads to draw an inference against the accused.

19. Hence, in my view, the accused failed to prove that she does not owe any enforceable debt to the complainant. Therefore, I am of the considered view that the presumption under section 139 of

N.I.Act, which is in favour of the complainant still remained, un rebutted.

20. Having regard to the oral and documentary evidence as noticed above, this Court is of the considered opinion that the accused failed to rebut the presumption raised in favour of the

Complainant.

S.M.C., Ndl. 10 C.C.642/2008

21. Therefore, none of the contentions raised by the accused merit consideration and they are accordingly rejected.

22. For the foregoing reasons, I hold that the accused is found guilty of the offence u/sec.138 of Negotiable Instruments Act and he is convicted under section 255(2) Cr.P.C.

Dictated to the Stenographer, transcribed by her, corrected

and pronounced by me in open Court, this the 24th day of

November,2017.

Special Magistrate, Nandyal.

S.M.C., Ndl. 11 C.C.642/2008

29. The accused is questioned with regard to quantum of sentence proposed to be imposed on him. He represented that.

S.M.C., Ndl. 12 C.C.642/2008

He requested the mercy of the Court.

30. Having considered the facts and circumstances of the case the accused is convicted under Section 255(2)Cr,P.C. and sentenced to undergo simple imprisonment for a period of 3 (Three) months besides to pay compensation of Rs.1,00,000/- to the Complainant under section 357(3)Cr.P.C.

Dictated to the Stenographer, transcribed by her, corrected

and pronounced by me in open Court, this the 11th day of October, 2017.

Special Magistrate,

Nandyal.

APPENDIX OF EVIDENCE

WITNESSES EXAMINED FOR

COMPLAINANT. ACCUSED

P.W.1. Guddeti Vara Prasad D.W-1.Venkateswarlu.

EXHIBITS MARKED FOR COMPLAINANT

Ex.P-1. Promissory note dt.10-04-2011 for Rs.1,00,000 .

Ex.P-2. Cheque bearing No.094015 for Rs.1,00,000/- issued by the accused

Ex.P-3. Original return memo dt.11-03-2013 of Karur Vysya Bank, Nandyal

Ex.P-4. Office copy of the legal notice dtd.13-03-2013

Ex.P-5. Refused postal cover of Accused

EXHIBITS MARKED FOR ACCUSED

Ex.D-1. Original Pan Card.

Ex.D-2. Original Adhar Card

Ex.D-3. Original Employees Identify card

Ex.D-4. Attested service Register copy.

S.M.C., Ndl. 13 C.C.642/2008

S.M. NDL

CALENDAR AND JUDGMENT

IN THE COURT OF THE SPEICIAL MAGISTRATE:NANDYAL

C.C.No.345/2015

Date of offence 11-03-2013

Date of report or Complaint 22-08-2014

Date of apprehension of Accused 23-02-2016

Date of release on bail --

Date of commencement of trial 24-10-2016

Date of close of trial 16-03-2017

Date of sentence or Order 11-10-2017

Explanation of delay and remarks ---

CALENDAR AND JUDGMENT IN C.C.345/2015 ON THE FILE OF SPECIAL MAGISTRATE:NANDYAL.

Complainant Guddeti Vara Prasada Reddy, S/o.Papi Reddy, aged 46 years,Hindu Employee,R/o.H.No.8-2-93,Chalamaiah street, Allagadda village,Allagadda Mandal, Kurnool District. Accused Vallapu Venkateswarlu, S/o.Yellappa, aged 45 years, Hindu,Employee, working as line Man, in A.P.TRANSCO,Rudravaram

S.M.C., Ndl. 14 C.C.642/2008 village,Rudravaram Mandal,Kurnool Dist. Offence Dis-honour of cheque

Section of Law U/Sec.138 of N.I.Act

Finding of the court Found guilty.

Sentence or Order Accused is convicted U/Sec.255(2) Cr.P.C., for the offence U/Sec.138 of N.I. Act and sentenced to undergo simple imprisonment for a period of 3 (Three) months besides to pay compensation of Rs.1,00,000/- (Rupees: One lakh only) to the Complainant U/Sec.357 (3) Cr.P.C.

Sd/- M.Seshanjaneyulu,

Special Magistrate, Nandyal. //True Copy//

IN THE COURT OF THE SPECIAL MAGISTRATE: NANDYAL

Present:- Sri M.Seshanjaneyulu, Special Magistrate.

Tuesday, the 21 st day of November,2017

C.C. No.207/2016

G.Venkateswarlu, son of Nagendra, Hindu,R/o.H.No.

29-155-D-2, A-3, Bharathamata temple Street,

Tekke, Nandyal town and Mandal, Kurnool Dist. Complainant -Versus-

M.David Prasanna Rao, son of Murathoti Luke,

Employee in Milk Dairy, SPY Reddy Factory

H.No.26/57A, Mission compound, Near Pedda

Church, Nandyal town and Mandal,Kurnool Dist. Accused.

This case coming on for hearing on 3-11-2017 before me in the presence of Sri Y.Venkateswara Reddy,Advocate for the Complainant and of

Sri S.Nagaraja Rao, Advocate for the Accused and having stood over for consideration till this day, the Court delivered the following:-

J U D G M E N T

1.This is a Private Complaint filed under Sec.200 Cr.P.C. against the accused for the offence punishable under section 138 of N.I. Act with the following allegations:-

On 10-5-2013 the accused has borrowed a sum of Rs.1,70,000/- (Rupees One lakh seventy thousands only) from the complainant for his family necessities and as a security the accused has executed a Demand

Promissory note in his favour agreeing to repay the same with interest at 24% p.a. In spite of several demands made by the Complainant, the accused failed to discharge the said promissory note the accused has been dodging the matter some pretext or other. Finally, towards discharge of the said amount he issued a cheque bearing No.003032 dt.21-12-2015 for

Rs.1,70,000/- drawn on Karnataka Bank Ltd.,Nandyal Branch towards part settlement of the promissory note amount and requested the complainant to present the cheque for encashment and also promised that he will pay the balance amount within short period and take back the promissory note from the complainant. He also promised that the cheque will be honoured when presented the cheque in Karnataka Bank,Nandyal. So,the cheque issued by the Accused towards discharge of his liability. So, it is legally enforceable debt due to the complainant. The Complainant presented the cheque on 21-12--2015 for collection in Union Bank, Nandyal into his account. But,the accused Bank dishonoured the cheque on 21-12-2015 with endorsement ” FUNDS INSUFFICIENT”. The said information was received by him on 21-12-2015 through his Bank. Though,the accused fully knowing well that there are no funds in his account, he issued a cheque to the Complaint to cheat the Complainant.

The Complainant issued a Legal Notice on 28-12-2015 through his lawyer to the accused calling upon the accused for the payment of the said amount of money due under the dishonor of cheque within fifteen days from the date of receipt of the notice. The accused refused to receive the said notice and the notice was returned to the complainant. So, it is deemed to be served. After knowing that the Complainant issued a notice, neither he paid the amount nor gave any reply. Hence, the complaint.

2. The case was taken on file for the offence under Section 138 of the

Negotiable Instrument Act against the accused.

3. When the Accused appeared before the Court copies of all the documents on which the complainant relied were supplied to him. When examined under section 251 Cr.P.C. by putting the substance of the accusations leveled against him, he denied the same, pleaded not guilty and claimed to be tried.

4. In support of his case, the complainant examined himself as P.W.1 and marked Exs.P-1 to P-5.

5. After closure of evidence on behalf of the complainant, the accused was called upon to explain the incriminating material appearing against him in the evidence of P.Ws.1 U/Sec. 313(1)(b) Cr.P.C. he denied the same. He stated that a false case is foisted against him.

6. Though he reported that he got witnesses to be examined on his behalf he did not choose to examine witnesses on his behalf.

7. The learned Counsel for the Complainant made the following submissions:-On 10-5-2013 the accused has borrowed a sum of

Rs.1,70,000/-(Rupees One lakh seventy thousands only) from the complainant for his family necessities and as a security the accused has executed a Demand Promissory note in favour of the complainant agreeing to repay the same with interest at 24%p.a. In spite of several demands made by the Complainant, the accused failed to discharge the said promissory note the accused has been dodging the matter some pretext or other. Finally, towards discharge of the said amount he issued a cheque bearing No.003032 dt.21-12-2015 for Rs.1,70,000/- drawn on Karnataka

Bank Ltd.,Nandyal Branch towards part settlement of the promissory note amount and requested the complainant to present the cheque for encashment and also promised that he will pay the balance amount within short period and take back the promissory note from the complainant. He also promised that the cheque will be honoured when presented the cheque in Karnataka Bank, Nandyal. So,the cheque issued by the Accused towards discharge of his liability. So, it is legally enforceable debt due to the comlainant. The Complainant presented the cheque on 21-12--2015 for collection in Union Bank, Nandyal into his account. But,the accused Bank dishonoured the cheque on 21-12-2015 with an endorsement ” FUNDS

INSUFFICIENT” in his account. The said information was received by him on 21-12-2015 through his Bank. The accused fully knowing well that there are no funds in his account, he issued a cheque to the Complainant to cheat the

Complainant.

The Complainant issued a Legal Notice on 28-12-2015 through his lawyer to the accused calling upon the accused for the payment of the said amount of money due under the dishonor of cheque within fifteen days from the date of receipt of the notice. The accused refused to receive the said notice and the notice was returned to the complainant. So, it is deemed to be served. After knowing that the Complainant issued a notice, he did not pay the amount and did not give any reply.

8. Per contra, the learned defence counsel contended that the

Complainant did not execute the promissory note Ex.P-1. The complainant obtained the blank pronote and filled up the contents, later. In the pronote there is no endorsement from the accused that he himself scribed Ex.P-1.

09. Now, the point for consideration in this case is whether the complainant has proved the guilt of the accused beyond all reasonable doubt for the offence under Sec.138 of the Negotiable Instruments Act?

10. Under Section 138 of the Negotiable Instruments Act where a cheque issued by the drawer in the discharge of any debt or any other liability is returned by the bank unpaid, because the amount standing to the credit of that account is insufficient to honour the cheque, the said person is deemed to have committed an offence. This is subject to proviso to Section 138 which provides that the said cheque should have been presented to the bank within the period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier. The payee must also make a demand for the payment of the said amount by giving a notice in writing to the drawer of the cheque within 30 days of the receipt of the information by him from the bank regarding the return of the cheque unpaid. If despite this demand, the drawer fails to make the payment within fifteen days of the receipt of the notice, a cause of action arises for prosecuting him for the offence punishable under section 138 of the Act.

11. The Act further contains provisions regarding presumptions. They are

Secs.118 and 139. Under Section 118, it shall be presumed until the contrary is proved that a negotiable instrument, which includes a cheque, is supported by consideration and that it is made on the date which it bears.

Under Sec.139, it shall be presumed, until the contrary is proved, that the holder of the cheque received it in discharge of a legally enforceable debt or other liability.

12. Since the case of the accused is of total denial, the initial burden is on the complainant to prove the necessary facts for raising the presumptions under Sec.118 and 139 of the Act. For that purpose, the Complainant as

P.W-1 deposed that On 10-5-2013 the accused has borrowed a sum of

Rs.1,70,000/-(Rupees One lakh seventy thousands only) from him for his family necessities and as a security the accused has executed a Demand

Promissory note in his favour agreeing to repay the same with interest at 24%p.a. In spite of several demands made by the Complainant, the accused failed to discharge the said promissory note the accused has been dodging the matter some pretext or other. Finally, towards discharge of the said amount he issued a cheque bearing No.003032 dt.21-12-2015 for

Rs.1,70,000/- drawn on Karnataka Bank Ltd.,Nandyal Branch towards part settlement of the promissory note amount and requested the complainant to present the cheque for encashment and also promised that he will pay the balance amount within short period and take back the promissory note from the complainant. He also promised that the cheque will be honoured when presented the cheque in Karnataka Bank,Nandyal. So, the cheque issued by the Accused towards discharge of his liability. So, it is legally enforceable debt due to the complainant. The Complainant presented the cheque on 21-12--2015 for collection in Union Bank, Nandyal into his account But, the accused Bank dishonoured the cheque on 21-12-2015 with endorsement ”

FUNDS INSUFFICIENT”. The said information was received by him on 21-12- 2015 through his Bank. The accused fully knowing well that there are no funds in his account, he issued a cheque to the Complainant to cheat the

Complainant.

The Complainant issued a Legal Notice on 28-12-2015 through his lawyer to the accused calling upon the accused for the payment of the said amount of money due under the dishonor of cheque within fifteen days from the date of receipt of the notice. The accused refused to receive the said notice and the notice was returned to the complainant. So, it is deemed to be served. After knowing that the Complainant issued a notice, he did not pay the amount and did not give any reply.

13. He relied on Ex.P-1 promissory note dt.10-05-2015 for Rs.1,70,000 executed by the accused in favour of Complainant. Ex.P-2 is the cheque bearing No.003032 for Rs.1,70,000/-dt.21-12-2015, Ex.P-3 is the return information of Karnataka Bank, Nandyal to Union Bank of India, Nandyal dt.21-12-2015,Ex.P-4 is office copy of legal notice dt.28-12-2015 issued by the complainant to the accused, Ex.P-5 is the original returned un served postal cover dt.01-01-2016.

13. It was elicited in cross-examination of P.W-1 that the accused is a friend to him. Due that reason he lent Rs.1,70,000/- with interest at 24%p.a. It is further elicited in cross-examination that the accused himself executed the promissory note. The suggestion denied by P.W-1 that he obtained a blank pronote from the accused with his signature. Later, the contents were filled up. Though the accused requested to lend Rs.2,00,000/- the Complainant could arrange only Rs.1,70,000/- only. The accused

Prasanna Rao holding Account No.5432500101038801 in Karnataka Bank

Ltd.Nandyal. The cheque is for Rs.1,70,000/-dt.21-12-2015 in the name of

G. Venkateswarlu which was presented in Union Bank on 21-12-2015.

Originally, the complainant obtained pronote much earlier to the issuance of chequedt.21-12-2015, that was not denied by the Accused. Later, the cheque was issued by the Drawer-Accused. When the cheque is dishonoured by non payment, the holder must give notice of dis-honour of cheque to the accused. In the present case also the accused refused to receive the statutory notice issued by the Complainant on 1-1-2016.

It is held in N.Hasainar vs.M.Hasainar2009.Crl.L.J.1213 that “mere denial of the case of the complainant will not constitute rebuttal of the evidence. The accused shall enter witness box and lead contra evidence rebutting the presumption”.

In the present case also, the accused denied the case of the complainant which will not constitute the rebuttal of evidence. Though he got opportunity to examine himself he did not enter into witness box and lead contra evidence rebutting the presumption.

14. By examining himself and marking documents like Exs.P-1 to P-5 the

Complainant could prove his case beyond reasonable doubt.There is nothing to disbelieve the evidence of P.W-1 and Ex.P.1 to Ex.P.5 documents.

15. Having regard to the oral and documentary evidence as noticed above, this Court is of the considered opinion that the accused failed to rebut the presumption raised in favour of the Complainant.

16. Therefore, none of the contentions raised by the accused merit consideration and they are accordingly rejected.

17. For the foregoing reasons, I hold that the accused is found guilty of the offence u/sec.138 of Negotiable Instruments Act and he is convicted under section 255(2) Cr.P.C.

18. The accused is questioned with regard to quantum of sentence proposed to be imposed on him. He represented that due to ill-health of his mother he could not pay the amount to the Complainant. He requested the mercy of the Court.

19. Having considered the facts and circumstances of the case the accused is convicted under Section 255(2) Cr,P.C., and sentenced to undergo simple imprisonment for a period of 3 (Three) months besides to pay Compensation of Rs.1,70,000/- to the Complainant under section 357(3) Cr.P.C.

Dictated to the Stenographer, transcribed by her, corrected and

pronounced by me in open Court, this the 21st day of November,2017.

Sd.M.Seshanjaneyulu Special Magistrate, Nandyal.

APPENDIX OF EVIDENCE

WITNESSES EXAMINED

FOR COMPLAINANT. FOR ACCUSED

P.W.1. G.Venkateswarlu -None-

EXHIBITS MARKED FOR COMPLAINANT

Ex.P-1. Promissory note dt.10-05-2013 for Rs.1,70,000/- executed by the accused in favour of Complainant.

Ex.P-2. Cheque bearing No.003032 for Rs.1,70,000/-, dt.21-12-2015.

Ex.P-3. Return Memo dt.21-12-2015.

Ex.P-4. Office copy of legal notice, dt.28-12-2015.

Ex.P-5. Original refused postal cover.

EXHIBITS MARKED FOR ACCUSED

NIL

Id.M.S. S.M Ndl. //True Copy//

CALENDAR AND JUDGMENT

IN THE COURT OF THE SPEICIAL MAGISTRATE:NANDYAL

C.C.No.207/2016

Date of offence 21-12-2015

Date of report or Complaint 02-03-2016

Date of apprehension of Accused 23-11-2016 Date of release on bail -- Date of commencement of trial 05-01-2017 Date of close of trial 03-11-2017 Date of sentence or Order 21-11-2017 Explanation of delay &remarks --

CALENDAR AND JUDGMENT IN C.C.No.207/2016 ON THE FILE OF SPECIAL MAGISTRATE:NANDYAL.

Complainant Venkateswarlu, S/o Nagendra, Hindu, R/o H.No.155-D-2-A3,Bharathamatha Temple Street, Tekke, Nandyal Town and Mandal.

Accused M.David Prasanna Rao S/o Murathoti Luke, Employee in Milk Daily, SPY Reddy Factory, H.No.26/57-A, Mission Compoun, near Pedda Church, Nandyal Town and Mandal, Kurnool District.

Offence Dis-honour of cheque

Section of Law U/Sec.138 of N.I.Act

Finding of the court Found guilty.

Sentence or Order Accused is convicted U/Sec.255(2) Cr.P.C., for the offence u/sec.138 of N.I. Act and sentenced to undergo simple imprisonment for a period of 3 (Three) months besides to pay compensation of Rs.1,70,000/-(Rupees: One Lakh and Seventy Thousands only) to the Complainant sec.357 (3) Cr.p.C.

Sd.M.Seshanjaneyulu Special Magistrate, Nandyal.

//True Copy//

IN THE COURT OF THE SPECIAL MAGISTRATE COURT:NANDYAL

Present:- Sri M.Seshanjaneyulu, Special Magistrate.

Thursday, the 23rd day of November, 2017.

C.C.No.839/2015

M/S Shriram City Union Finance Ltd.,

Nandyal Branch, represented by its

Authorized signatory, K.Gurappa, son of

Vijaya Raju, aged 28 years, Srinivasa Nagar,

Nandyal, Kurnool District. ...Complainant.

-Versus-

U.Ram Mohan,s/o. U.Thimmaiah,

Hindu, H.No.26-340-B,M.S.Nagar,

Nandyal,Kurool District. …Accused.

This case coming on 07-11-2017 for final hearing before me in the presence of Sri Putta Ramakrishna, Advocate for thecomplainant and of Sri S.Raja Gopal Reddy, and Kum.Y.Devamma, Advocates for the accused and having stood over for consideration till this day, the court delivered the following:-

J U D G M E N T

1.This is a Private Complaint filed under Sec.200 Against the accused for the offence punishable under section 138 of N.I. Act with the following allegations:-

The Accused approached their company to avail loan by way of submitting an application, their company agreed to sanction the loan to the Accused and he borrowed an amount of Rs.3,80,000/- from their company on 25-07-2014 and as security, the accused executed documents for Rs.3,80,000/- on 25-07-2014 in favour of Complainant company agreeing to repay the same in installments with interest. The

Accused issued a cheque bearing No. 438241 dated:01-08-2015 for

Rs.2,26,000/- drawn on Andhra Bank, Nandyal. The Complainant presented the said cheque in City Union Bank Ltd., Nandyal for collection on 10-08-2015, but the said cheque was returned with reason that “FUNDS INSUFFICIENT”. He issued statutory notice dated 01-09- 2015 to the Accused to pay the cheque amount within 15 days from the date of receipt of the notice and the said notice was returned as un served on 10-09-2015. The complainant waited 15 days, and there- after the Complainant filed this complaint. Hence, the complaint.

2. The case was taken on file for the offence under Section 138 of the Negotiable Instrument Act against the accused.

3. When the Accused appeared before the Court copies of all the documents on which the complainant relied were supplied to him. When examined under section 251 Cr.P.C.by putting the substance of the accusations leveled against him, he denied the same, pleaded not guilty and claimed to be tried.

4. In support of his case, the complainant examined himself as P.W.1 and Exs.P-1 to P-5 are marked.

5. After closure of evidence on behalf of the complainant, the accused was called upon to explain the incriminating material appearing against him in the evidence of P.W.1 under section 313(1)(b)Cr.P.C. He denied the same. He reported no defence witnesses to be examined on his behalf.

6. The learned Counsel for the Complainant made the following submissions:- The Accused approached their company to avail loan by way of submitting an application, their company agreed to sanction the loan to the Accused and he borrowed an amount of Rs.3,80,000/- from their company on 25-07-2014 and as security, the accused executed documents for Rs.3,80,000/- on 25-07-2014 in favour of

Complainant company agreeing to repay the same in installments with interest. The Accused issued a cheque bearing No. 438241 dated:01-08- 2015 for Rs.2,26,000/- drawn on Andhra Bank, Nandyal. The

Complainant presented the said cheque in City Union Bank Ltd., Nandyal for collection on 10-08-2015, but the said cheque was returned with reason that “FUNDS INSUFFICIENT”. He issued statutory notice dated 01-09-2015 to the Accused to pay the cheque amount within 15 days from the date of receipt of the notice and the said notice was returned as un served on 10-09-2015. The complainant waited 15 days, and there after the Complainant filed this complaint.

7. Per contra, the leaned defence counsel made the following submissions:-The Complainant did not file any documents to prove that the Accused has borrowed the amount from the Complainant company.

P.W-1 has not witnessed the transactions between the Complainant and the Accused for availing the loan. Even the loan application of the accused was not filed. Statutory notice was not issued to the accused.

If the accused receives the notice he will give suitable reply for the notice. The signatures in Ex.P-1 cheque does not belong to the accused.

8. Now, the point for consideration in this case is whether the complainant has proved the guilt of the accused beyond all reasonable doubt for the offence under Sec.138 of the Negotiable Instruments Act?

9. Under Section 138 of the Negotiable Instruments Act where a cheque issued by the drawer in the discharge of any debt or any other liability is returned by the bank unpaid, because the amount standing to the credit of that account is insufficient to honour the cheque, the said person is deemed to have committed an offence. This is subject to proviso to Section 138 which provides that the said cheque should have been presented to the bank within the period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier. The payee must also make a demand for the payment of the said amount by giving a notice in writing to the drawer of the cheque within 30 days of the receipt of the information by him from the bank regarding the return of the cheque unpaid. If despite this demand, the drawer fails to make the payment within fifteen days of the receipt of the notice, a cause of action arises for prosecuting him for the offence punishable under section 138 of the Act.

10. The Act further contains provisions regarding presumptions. They are Secs.118 and 139. Under Section 118, it shall be presumed until the contrary is proved that a negotiable instrument, which includes a cheque, is supported by consideration and that it is made on the date which it bears. Under Sec.139, it shall be presumed, until the contrary is proved, that the holder of the cheque received it in discharge of a legally enforceable debt or other liability.

11. To prove its case, the Complainant Company examined P.W-1 Sri

K. Gurrappa, Authorized signatory in Shriram City Union Finance Ltd.,

Nandyal. As per his evidence The Accused approached their company to avail loan by way of submitting an application, their company agreed to sanction the loan to the Accused and he borrowed an amount of

Rs.3,80,000/- from their company on 25-07-2014 and as security, the accused executed documents for Rs.3,80,000/- on 25-07-2014 in favour of Complainant company agreeing to repay the same in installments with interest. The Accused issued a cheque bearing No.

438241 dated:01-08-2015 for Rs.2,26,000/- drawn on Andhra Bank,

Nandyal. The Complainant presented the said cheque in City Union Bank

Ltd., Nandyal for collection on 10-08-2015, but the said cheque was returned on 14-08-2015 with reason that “FUNDS INSUFFICIENT”.

He issued a statutory notice dated 01-09-2015 to the Accused to pay the cheque amount within 15 days from the date of receipt of the notice and the said notice was returned as un served on 10-09-2015. The complainant waited 15 days, and there after,this Complaint was filed.

As per the evidence the accused issued a cheque bearing

No.438241 dated:01-08-2015 for Rs.2,26,000/- drawn on Andhra Bank,

Nandyal.When it was presented on 10-08-2015, the cheque was returned on 14-08-2015 for the reason” FUNDS INSUFFICIENT”.

Except the cheque, he did not file either Hypothecation agreement or pronote or even the Loan application for availing loan was not filed and not marked through P.W-1.As per P.W-1’s evidence the accused borrowed Rs.3,80,000/- on 25-07-2014 and executed promissory note for the same amount, whereas the cheque was issued for

Rs.2,26,000/-. Though he has stated that Four wheeler was sold away and realized Rs.3,20,000/- and for the remaining balance he has issued a cheque, but the same fact is not averred either in the complaint, notice or in the Chief Evidence Affidavit of P.W-1. P.W-1 failed to prove that Ex.P-1 cheque was issued towards legal liability. Since, no hypothecation agreement, and no pronote are marked, it cannot be said that he borrowed the said amount and committed default, later he issued a cheque. There is no other evidence to prove the said fact.

12. As per the decisions of the Hon’ble Apex Court in 2008(1)ALT(Crl)444(SC) in “P.K.Manmadhan Kantha-Appellant–Vs-

Sanjeev Raj and another” that the Complainant has to prove its case with convincing evidence. But,the complainant neither examined the person who witnessed the transaction at the time of issuance of cheque nor Banker. So, P.W-1’s evidence alone is not sufficient to convict the accused.

It is held in a decision 2009(2) ALD (Crl) 419 in “Jugesh Sehgal --- -vs-Shamsher Singh that to punish the accused for the offence under section 138 of the Negotiable Instruments Act, the following ingredients have to be satisfied.

(i) A person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount money to another person from out of that account.

(ii) The cheque should have been issued for the discharge in whole or in part, of any debt or other liability.

(iii) that cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity which ever is earlier

(iv) that cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of the account is insufficient to honour the cheque or tht it exceeds the amount arranged to be paid from that account by an agreement made with the bank.

(v) that the payee of the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within 15 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;

(vi) 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.

Following the above decision, the case of both parties have to be examined.

13. In the decisions in “C. Antony -Vs-K.G.Raghavan Nair and “K.Krishna Reddy -vs-K.Rajender and another in 2012 (1) ALT (Crl) 261 (A.P) the Hon'ble Apex Court and the Hon'ble High Court of Andhra

Pradesh held when the complainant has failed to prove about the transactions between the complainant and the accused and when there is no other evidence to show that the accused had issued the cheque towards discharge of legal liability, the accused is entitled that to show that the accused had issued the cheque towards discharge of legal liability,the accused is entitled for benefit of doubt.

By relying upon the decisions submitted by the learned Counsels for both parties, I am of the opinion that to punish the accused for the offence under section 138 of the Negotiable Instruments Act, the complainant has to prove that the accused had issued the cheque towards discharge of legal liability to the complainant.

14. When the Complainant failed to prove that about the transactions between the complainant and the accused, and when there is no evidence to show that the accused had issued cheque towards discharge of legal liability, the accused is entitled for benefit doubt.

Accordingly, the point is answered.

15. The facts of the decision relied on by the learned defence counsel are some what identical to the facts of the present case on hand.

16. For the foregoing reasons, I hold that the Accused is not found guilty of the offence under section 138 of N.I.Act.

In the result, the accused is acquitted u/sec.255(1) Cr.P.C. for the offence under section 138 of N.I.Act.

Dictated to the Stenographer, transcribed by her, corrected and

pronounced by me in open Court, this the 23rd day of November,2017.

Special Magistrate, Nandyal.

APPENDIX OF EVIDENCE

WITNESSES EXAMINED

FOR COMPLAINANT. FOR ACCUSED

PW.1. K.Gurrappa, Authorised Signtory of D.W-1.K.Rajesh Shriram City Union Finance Ltd., Nandyal.

EXHIBITS MARKED FOR COMPLAINANT

Ex.P-1. Cheque bearing No.438241 for Rs.2,26,000/-, dt.1-08-2015. Ex.P-2. Return Memo dt.14-08-2015. Ex.P-3. Office copy of legal notice, dt.1-09-2015. Ex.P-4. Unserved Postal cover dtd.10-09-2015 Ex.P-5. Attested Copy of Authorization, dt.18-06-2012.

EXHIBITS MARKED FOR ACCUSED

-NIL- S.M. NDL

CALENDAR AND JUDGMENT

IN THE COURT OF THE SPEICIAL MAGISTRATE:NANDYAL

C.C.No.839/2015

Date of offence 14-08-2015

Date of report or Complaint 23-09-2015

Date of apprehension of Accused 18-01-2017

Date of release on bail --

Date of commencement of trial 04-04-2017

Date of close of trial 24-10-2017

Date of sentence or Order 23-11-2017

Explanation of delay &remarks ---

CALENDAR AND JUDGMENT IN C.C.839/2015 ON THE FILE OF SPECIAL MAGISTRATE:NANDYAL.

Complainant M/S.Shriram City Union Finance Ltd., Nandyal Branch, represented by its Authorized signatory, K.Gurappa, son of Vijaya Raju, aged 28 years, Srinivasa Nagar, Nandyal, Kurnool District. Accused U.Ram Mohan,s/o. U.Thimmaiah, Hindu, H.No.26-340-B,M.S.Nagar,Nandyal,Kurool District. Offence Dis-honour of cheque

Section of Law U/Sec.138 of N.I.Act

Finding of the court Found not guilty.

Sentence or Order Accused is acquitted U/Sec.255(1) Cr.P.C., for the offence U/Sec.138 of N.I. Act . The bail bond of the accused shall be in force upto 6 months as per Sec.437-A Cr.P.C.

Special Magistrate Nandyal.

IN THE COURT OF THE SPECIAL MAGISTRATE : NANDYAL

(SEC.256 Criminal Procedure Code)

Dated, this the 18th day of January,2017.

C.C.No.455/2012

S.MD.Rafi,s/o.S.Abdul Razack,aged 42 years Muslim,business, R/o.25/414-B3,Salimnagar

Nandyal town, Kurnool District. ..Complainant

-Vs-

Prasanth, United elements,555/9-1,9th .cross 6th main,Upper palace Orchards,Sadasiva Nagar Bangalore. Accused.

1. Offence : U/s.138 of N.I. Act

2. Date of Offence : 12.01.2011

3. Date of Complaint : 27.06.2012

4. Date of Hearing : 16.11.2017

O R D E R

The case was called on for hearing to-day to which it had been posted/adjourned. The complainant is not being present either in person or by pleader, the accused be acquitted U/Sec.256 Cr.P.C.

Special Magistrate Nandyal.