1 CC No.7908 of 2021, dt:06.06.2025
IN THE COURT OF THE SPL. J.F.C.M. EXCISE - CUM - V ADDL.
JUNIOR CIVIL JUDGE - CUM- V ADDL. JUDICIAL MAGISTRATE, AT
L.B.NAGAR , R.R.DISTRICT, HYD.
Friday, This the 06 th day of June, 2025.
Present: Smt.P.Gopika Naga Sravya
Spl. J.F.C.M. Excise – cum - V Addl.Junior Civil Judge cum V Addl. Judicial Magistrate at L.B.Nagar, Ranga Reddy District.
C.C. No. 7908 of 2021
(OLD CC No.270 of 2018)
BETWEEN: M/s.Andhra Bank(A Govt.of India Undertaking), Kothapet Branch, RR District, Hyderabad duly rep. Manager, L.Sudhershan Reddy by its Assistant General Manager, Sri.K.Laxma Reddy.
… Complainant
A N D
1. Tae.Aqua Protein Feed and Prop.Matta Thomas Alva Edison, R/o:Flat No.A-303, Swarna Rama Towers, Royalam, Bheemavaram, W.Godavari(D), Andhara Pradesh.
2. Matta Thomas Alva Edison, S/o:Matta Issac, Age:59 yrs, Occ;Business, R/o:11-15-116-3, Plot No.137, Doctors Colony, Road No.4, Saroornagar, Hyderabad-500068.
... Accused No.1 and 2.
****
This case is coming up before me for final hearing on 23.09.2024 in the presence of Sri Jashwanth Kumar Thota, Advocate for complainant and of M/s Yeka Bala Subrahmanyam, Advocate for the accused no.1 and 2 and the matter is having stood over for consideration till this day, the Court made the following:- 2 CC No.7908 of 2021, dt:06.06.2025
J U D G M E N T
1.The complaint is filed under Sec.200 Cr.P.C. against the accused no.1 and 2 for offence committed by him under Sec. 138 r/w 142 of
Negotiable Instruments Act, 1881.
2.Brief facts of the complainant case are as follows:-
The Complainant is a banking company constituted under the banking companies Act, 1980. That in the course of the banking operations the complainant has introduced loan facilities for the benefit of customers. Under this facility M/s. OLIVET FEEDS & CO. rep.
by Smt. Ratna Kumari, W/o Matta Thomas Alva Edison approached the complainant bank for OPEN CASH CREDIT loan and submitted an application for sanction of OCC loan, considering the request of M/s.
OLIVET FEEDS&CO, rep. by its propritrex Smt Ratna Kumari, W/o.M.
Thomas Alva Edison, Complainant bank sanctioned the OCC loan amount of Rs.25,00,000/-(Rupees Twenty Five Lakhs only) through
Account vide no.019213100000478. For securing the payment of the said credit facilities the accused and borrower executed necessary documents in favour of complainant. The borrower after availing the loan failed to pay the amount. After several remainders over phone, personal visits by complainant the borrower and her husband who is accused no.2 approached complainant bank.
3 CC No.7908 of 2021, dt:06.06.2025
3.Further submitted that on 31-07-2018, accused no.2 and borrower came to complainants bank and gave a TAE AQUA PROTEINS
FEEDS Company cheque, who is accused no. 1. The accused no.2 is the husband of the borrower who issued cheque on the name of loan account to be paid in favour of "OLIVET FEEDS & CO" which is held with complainant, drawn on Bank of India, Surya bagh branch,
Vishakapatnam, bearing no. 000069 for Rs.4,00,000/- (Rupees four
Lakhs only) to the complainant. The accused no.2 to discharge the liability of his wife’s (borrower) legally enforceable debt, issued TAE
AQUA PROTEINS FEEDS Company cheque who is accused no.1 and the borrower gave a letter with a "written promise" to purchase (take) the cheque on 31-07-2018 to overcome the dues. The accused no.2 assured the complainant that he has sufficient balance in his account no.000069 on the date of presentation for honouring the commitment of repayment of loan. In view of the commitment of accused further proceedings are postponed without prejudice.
4.The complainant further submitted that the accused has given a cheque bearing no.000069, dt:31.07.2018 as part payment of
Rs.4,00,000/- (Rupees Four Lakhs only) from the outstanding amount of Rs.29,38,467/-(Rupees Twenty Nine Lakhs Thirty Eight Thousand 4 CC No.7908 of 2021, dt:06.06.2025
Four Hundred and Sixty and Seven only) drawn on Bank of India,
Suryabagh branch, Vishakapatnam, towards discharge of loan sanctioned to M/s. OLIVET FEEDS&CO in favour of the complainant bank and assured the complainant bank that accused has sufficient funds in his account to honour the cheque in question. On such assurance of the accused, the complainant bank presented the cheque for collection on 03.08.2018 in Andhra Bank, Kothapet branch,
Hyderabad, it was returned from Bank of India, Suryabagh branch,
Vishakapatnam with return memo dt.04.08.2018 as funds in sufficient.
The complainant informed the same to the accused personally and demanded to pay the dishonoured cheque amount in cash, but the accused did not respond properly. The Accused no.2 has failed and neglected to make the payment as per statement of account. As such, the complainant got issued legal notice in terms of Sec.138 N.I.Act on
dt:17.08.2018 by registered post with acknowledgment due on
18.08.2018 to the accused regarding the payment of dishonoured cheque. The complainant further submitted that counsel for complainant sent the legal notice dt:17.08.2018, by registered post with acknowledgment due on dt:18.08.2018 to the accused under the provisions of the Negotiable Instruments Act, 1881 and demanded the 5 CC No.7908 of 2021, dt:06.06.2025 payment of the amount of the dishonoured cheque. The legal notice sent to his business address is returned as “no such person in the address” and the legal notice sent to the accused residential address under registered post with acknowledgment due was served to the accused. Further submitted that with the demand made by the complainant within 15 days from the date of the receipt of the notice and there by committed the offence under section 138 of NI Act, 1881.
Hence the complaint.
5.Learned I Special Magistrate, Cyberabad at Hasthinapuram,
before whom the complaint was filed registered the same against both
the accused persons A1 and A2 for offence under Sec. 138 of N.I. Act and issued summons. Thereafter, the case was transferred to this
Court for trial and disposal as per the orders of Hon’ble Prl. District and
Sessions Judge, Ranga Reddy District.
6.The accused No.1 being represented by accused no.2 is present copies of documents were furnished and was examined under Sec. 251
Cr.P.C. He denied the offence alleged against him and claimed to be tried. During trial, the complainant examined himself as PW-1 and got marked documents Ex.P1 to Ex.P.11. Further vide orders in
Crl.MP.No.490 of 2020, dt:04.03.2020, the proprietor of OLIVET FEEDS
6 CC No.7908 of 2021, dt:06.06.2025 & CO. examined as court witness but the evidence was eschewed on
dt:01.12.2023 who is the wife of accused no.2.
7.Accused was examined under Section 313 Cr.P.C, he denied the evidence of PW1 and reported no defence evidence on his behalf.
8.Heard arguments on both sides.
(i)The learned counsel for complainant filed written arguments stating that the accused no.2/Matta Thomas Alva Edison, Prop. Of TAE
AQUA PROTEINS FEEDS company is the husband of borrower of
Smt.Ratna Kumari. The borrower Smt.Ratna Kumari is the proprietor of
OLIVET FEEDS & CO., she approached the bank and obtained the Open cash credit (OCC) loan amount of Rs.25,00,000/- vide loan A/c.No.
019213100000478. For securing the loan, borrower executed certain documents in favour of the complainant bank. The borrower after availing the loan failed to pay the amount. After several demands and personal visits by complainant bank the borrower and her husband who is accused no.2 approached the complainant bank.
(ii)Further submitted that on 31.07.2018, accused no.2 and borrower came to complainant bank and gave a TAE AQUA PROTEINS
FEEDS company borrower issued the cheque in the name of loan account pay “OLIVET FEEDS & CO”, which is held with complainant, 7 CC No.7908 of 2021, dt:06.06.2025 drawn on Bank of India Suryabagh branch, Vishakapatnam, cheque bearing no.000069, for RS.4,00,000/- to the complainant. The accused no.2 to discharge the liability of his wife (borrower) legally enforceable debt issued TAE AQUA PROTEINS FEEDS company cheque, who is the accused no.1 and the borrower gave a letter with a return promise to purchase (take) the cheque on 31.07.2018 to overcome the dues. The accused no.2 assured the complainant that he has sufficient balance in his account no.000069 on the date of presentation for honoring the commitment of repayment of loan. In view of commitment of the accused further proceedings are postponed without prejudice.
(iii) Further submitted that the accused has given a cheque bearing no.000069, dt:31.07.2018 as a part payment of Rs.4,00,000/- from the outstanding due amount of Rs.29,38,467/- drawn on Bank of India,
Suryabagh branch, Visakhapatnam towards discharge of loan sanctioned to M/s. OLIVET FEEDS & CO., in favour of the complainant bank and assured the complainant bank that the accused has sufficient funds in his account to honor the cheque in question. On such assurance of the accused the complainant bank presented the cheque for collection on 03.08.2018 in Andhra Bank, Kothapet branch, 8 CC No.7908 of 2021, dt:06.06.2025
Hyderabad. It was returned from the Bank of India, Suryabagh branch,
Visakhapatnam, with return memo, dt:04.08.2018 as funds insufficient.
(iv)Further submitted that his client informed the same to the accused personally and demanded to pay the dishonored cheque amount in cash. But the accused did not respond properly. The accused No.2 has failed and neglected to make the payment as per statement of Account.
(v) Further submitted that his client send the notice through counsel, dated 17-08-2018 by registered post with acknowledgment due, dt:18-08-2018 to the accused under the provisions of N.I Act and demanded the payment of dishonored cheque amount. The legal notice sent to business address is returned as "No such person in the address" and the legal notice sent to accused residential address was served. Further submitted that the demand made by the complainant within 15 days from the date of receipt of the notice and thereby committed the offence under Section 138 of N.I Act. Further submitted that accused cheated the complainant bank by issuing the cheque without keeping sufficient funds in his account or arrangement in his bank account contrary to assurance and thereby committed the offence under section 138 of NI Act and the accused is liable to pay 9 CC No.7908 of 2021, dt:06.06.2025 interest under sec.80 of NI Act as the complainant would not have accepted the cheque but for the representation of the accused.
(vi)The complainant was examined as PW1 and marked the document Ex.P1 and deposed his chief examination and while cross examination of the PW1 admitted that OCC loan facility is provided to
OLIVET FEEDS & CO., proprietary is Ratna Kumari. The cheque was presented for realization and the same was dishonored”.
(vii)Further submitted that the borrower M.Ratna Kumari is examined as court witness. The borrower has deposed in her chief examination that she is the proprietor of OLIVET FEEDS & CO. and she obtained loan from Andhra Bank under OCC to a limit of Rs.25,00,000/-. The accused no.1 TAE AQUA PROTEINS FEEDS and accused no.2 is proprietor and husband of the borrower. As on the date of filing of this case she was due an amount of Rs. 25,00,000/- to Andhra Bank out of loan amount.
On 31.07.2018 the accused no.2 gave cheque to complainant bank for
Rs.4,00,000/-(Rupees Four Lakhs Only). The witness/borrower has admitted Ex.P2 and P3 cheque and letter. The borrower has admitted that it is true that she represented that the cheque would be honored as presented for realization. It is true that the cheque was bounced.
TAE company belongs to her husband he is proprietor.
10 CC No.7908 of 2021, dt:06.06.2025
(viii) It is therefore prayed that this Honourable Court may be pleased to punish the accused for the offence committed by him under section 138 read with section 142 of Negotiable Instruments Act, 1881 and sentence the accused to imprisonment as well as impose penalty to the extent of doubt the amount of the dishonored cheque of
Rs.4,00,000/- (Rupees Four Lakhs only) and further direct the amount so collected by way of penalty be paid to the complainant by way of compensation under section 357 of Criminal Procedure Code, 1973 and pass such other order or orders may deem fit and proper in the circumstances of the case.
9.In order to establish the offence under section 138 of NI Act, the complainant must fulfill all the essential ingredients of the offence.
Perusal of the bare provision reveals the following are the necessary ingredients of the offence.
(a)The accused issued a cheque on an account maintained by him with a bank
(b)The said cheque has been issued in discharge, in whole or in part, of any debt or other liability, which is legally enforceable.
11 CC No.7908 of 2021, dt:06.06.2025
(c)The said cheque has been presented to the bank within a period of three months from the date of cheque or within the period of its validity.
(d) The aforesaid cheque, when presented for encashment, was returned unpaid/dishonored.
(e) The payee of the cheque issued a legal notice of demand to the drawer within 30 days from the receipt of information by him from the bank regarding the return of the cheque.
(f) the drawer of the cheque failed to make the payment within 15 days of the receipt of aforesaid legal notice of demand.
10.In contrary the learned counsel for the accused argued that accused is nowhere concerned with the present case and that there is no legally enforceable debt or liability and that there is no receipt or pro-note for the alleged amount. Further contended that the cheque was issued by husband pertaining to TAE AQUA PROTEINS FEEDS, which is already paid to OLIVET FEEDS & CO.
11.Now, the point for consideration is
(i) Whether there is any legally enforceable debt as on the date of issuance of cheque?
(ii) Whether the complainant fulfilled the statutory requirements as contemplated under the provisions of Section 138 of Negotiable Instruments Act?
(iii) Whether the complainant has proved the guilt of accused for the
offence under Section 138 of Negotiable Instruments Act beyond
reasonable doubt?
12 CC No.7908 of 2021, dt:06.06.2025
POINT NO. 1:-
12.In order to put forth the case of complainant, complainant got examined himself as PW1 and got marked Ex.P1 to Ex.P11. As per the chief evidence affidavit of complainant and as per the contents of complaint briefly stated above, complainant is a banking company constituted under the banking companies (acquisition and transfer of undertaking) Act, 1980. That in the course of the banking operations the complainant has introduced loan facilities for the benefit of customers. Under this facility M/s. OLIVET FEEDS & CO represented by
Smt. Ratna Kumari, W/o. Matta Thomas Alva Edison approached the complainant bank for OPEN CASH CREDIT loan and submitted an application for sanction of OCC loan, considering the request of M/s.
OLIVET FEEDS & CO, rep. by its propritrex Smt Ratna Kumari, W/o. M.
Thomas Alva Edison, Complainant bank sanctioned the OCC loan amount of Rs.25,00,000/-(Rupees Twenty Five Lakhs only) through
Account vide no.019213100000478. For securing the payment of the said credit facilities the accused and borrower executed necessary documents in favour of complainant. The borrower after availing the loan failed to pay the amount. After several remainders over phone, 13 CC No.7908 of 2021, dt:06.06.2025 personal visits by complainant the borrower and her husband who is accused no.2 approached complainant bank.
13.Further submitted that on 31.07.2018, accused no.2 and borrower came to complainants bank and gave a TAE AQUA PROTEINS
FEEDS Company cheque, who is accused no. 1. The accused no.2 is the husband of the borrower issued cheque on the name of loan account pay "OLIVET FEEDS & CO" which is held with complainant, drawn on
Bank of India, Surya bagh branch, Vishakapatnam, bearing no. 000069 for Rs.4,00,000/-(Rupees four Lakhs only) to the complainant. The accused no.2 to discharge the liability of his wife (borrower) legal enforceable debt, issued TAE AQUA PROTEINS FEEDS Company cheque who is accused no.1 and the borrower gave a letter with a "written promise" to purchase(take) the cheque on 31.07.2018 to overcome the dues. The accused no.2 assured, the complainant that he has sufficient balance in his account no.000069 on the date of presentation for
honouring the commitment of repayment of loan. In view of the
commitment of accused further proceedings are postponed without prejudice.
14.The complainant further submitted that the accused has given a cheque bearing no.000069, dt:31.07.2018 as part payment of 14 CC No.7908 of 2021, dt:06.06.2025
Rs.4,00,000/-(Rupees Four lakhs only) from the outstanding amount of
Rs.29,38,467/-(Rupees Twenty Nine Lakhs Thirty Eight Thousand Four
Hundred and Sixty and Seven only) drawn on Bank of India, Suryabagh branch, Vishakapatnam, towards discharge of loan sanctioned to M/s.
OLIVET FEEDS & CO in favour of the complainant bank and assured the complainant bank that accused has sufficient funds in his account to
honour the cheque in question. On such assurance of the accused, the
complainant bank presented the cheque for collection on 03.08.2018 in
Andhra bank, kothapet branch, Hyderabad it was returned from bank of
India, Suryabagh branch, Vishakapatnam with return memo dt.04.08.2018 as 'funds in sufficient. The complainant informed the same to the accused personally and demanded to pay the dishonoured cheque amount in cash, but the accused did not respond properly. The
Accused no.2 has failed and neglected to make the payment as per statement of account. As such, the complainant got issued legal notice in terms of Sec.138 N.I.Act on dt:17.08.2018 by registered post with acknowledgment due on 18.08.2018 to the accused regarding the payment of dishonoured cheque. The complainant further submitted that counsel for complainant sent the legal notice dt:17.08.2019, by registered post with acknowledgment due on dt:18.08.2018 to the 15 CC No.7908 of 2021, dt:06.06.2025 accused under the provisions of the Negotiation Instruments Act, 1881 and demanded the payment of the amount of the dishonored cheque.
The legal notice sent to his business address is returned as no such person in the address and the legal notice sent to the accused residential address under registered post with acknowledgment due was served to the accused.
15.Further submitted that with the demand made by the complainant within 15 days from the date of the receipt of the notice and there by committed the offence under section 138 of NI Act, 1881.
In support of of his contention Ex.P.1 to EX.P11 are marked through him i.e., Ex.P1 is the Authorization letter of complainant, Ex.P2 is the original letter of "Written promise" by Borrower, dt: 31-07-2018, Ex.P3 is the original cheque Br.no. 000069, dt: 31-07-2018 for complainant,
Ex.P4 is the original cheque return memo, dt: (04.08.2018 of Andhra
Bank, Kothapet Branch, Hyderabad in respect of cheque Br.No.
000069,dt:31.07.2018, Ex.P5 is the office copy of legal notice, dt:
17.08.2018 sent to residence and business address, Ex.P6 is the original Regd. Post receipt No. RN087953232IN, RN087953100IN dt:
18.08.2018 of R.R.District Court complex, Post office, Ex.P7 is the original RPAD postal returned cover from business address, dt:
16 CC No.7908 of 2021, dt:06.06.2025 24.08.2018, Ex.P8 is the original postal tracking report of RPAD service,
dt: 01-09-2018, Ex.P9 is the copy of regularization of OCC loan A/c.
019213100000478, in Andhra Bank, Kothapet (Original), Ex.P10 is the copy of balance confirmation of account and receipt (Original) and Ex
P11 is the Loan statement of borrower and bank evidence certificate (Original).
16.During cross-examination of PW1 by learned counsel for accused, complainant admitted that he is Scheduled commercial bank and member of Indian Banks Association. Further admitted that all the circular, rules, regulations orders and notifications issued by RBI from time to time are binding on them. The Kothapet Branch of Andhara
Bank is Scale-5 branch headed by Assistant General Manager. Further
Pw1 admitted that he is Scale-2 manager in the branch. Further admitted that the present complaint was filed by Assistant General
Manager through Power of Attorney holder and he signed by him (in
Crl.MP.2125/2019). Original complaint is signed by AGM. He filed
authorization given to him in court. He admitted that authorization given to him by GPA holder K. Laxma Reddy. AGM which is Ex.P1. he do not know whether he had filed copy of GPA given to Laxma Reddy in court who authorized him to conduct this case. Pw1 admitted that he 17 CC No.7908 of 2021, dt:06.06.2025 is deposing to the facts based on record and he do not have personal knowledge. PW1 admitted that he is not principal manager of the
Kothapeta branch. The witness volunteers that he is looking after present case branch. The instructions to draft affidavit is given by him to his advocate. Further stated that he had gone through the contents of complaint before drafting affidavit. He did not file copy of incorporation certificate of Andhra Bank in this case. The accused is not their customer. OCC loan facility is provided to OLIVET FEEDS &
CO proprietary Ratna Kumari. There is no document filed by him executed by accused no.1 and 2 in favour of their bank undertaking to pay due amounts of OLIVET FEEDS & CO. PW1 admitted that he did not file any document for this loan to show that accused and borrower came to their bank on 31.07.2018. Further admitted that Ex.P2 is addressed by borrower to the bank and not by accused. Ex.P3 is executed infavour of OLIVET FEEDS & CO and not in the name of complainant. The accused had not addressed any letter infavour of their bank in respect of Ex.P3. The cheque was presented for realization by OLIVET FEEDS & CO. The cheque return memo Ex.P4 is issued in favour of OLIVET FEEDS & CO and not in favour of Andhra
Bank. Further admitted that he had no document to show that TAE 18 CC No.7908 of 2021, dt:06.06.2025
AQUA PROTEINS FEEDS is having head office at Bhimavaram. Ex.P2 shows that TAE AQUA PROTEINS FEEDS company is situated at
Visakhapatnam. Further he denied that he had no locustandi to file this case. After filing of this case an amount of Rs.4,50,000/- was credited into the account of OLIVET FEEDS & CO. Further he denied that he had no authorization to depose in this case and to present the complaint and that the complaint is not maintainable. He denied that
Ex.P1 is not valid document and that the documents marked in this case are not pertaining to complainant. Re-examination of PW1 is nil.
17.On perusal of records CW1 in her chief examination has deposed that she is the proprietor of OLIVET FEEDS & CO. She obtained loan from Andhra Bank under OCC to a limit of Rs.25,00,000/- and her husband was guarantor for the loan obtained by her from Andhra Bank.
On the date of filing of this present case she was due for an amount of
RS.25,00,000/- to Andhra Bank out of a loan amount. On 31.07.2018
CW1 gave cheque to the complainant for Rs.4,00,000/-. The witness admitted that Ex.P2 and Ex.P3 are cheques and letter. Further admitted that she represented that the cheque would be honored as presented for realization. Further admitted that the cheque was bounced. TAE company belongs to CW1 husband, he is proprietor. At 19 CC No.7908 of 2021, dt:06.06.2025 this stage the further chief examination of CW1 was deferred for want of documents. Later CW1 evidence was closed as eschewed vide docket order dt:01.12.2023. The accused did not enter into the witness box and no witnesses were examined.
18. In the backdrop of the foregoing factual score, this court shall now proceed to examine the position of law governing the facts peculiar to the present case.
19.It is a well settled principle of criminal jurisprudence that a criminal trial precedes 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 is on the complainant/prosecution to prove the guilt of the accused and the standard of proof for the same is beyond reasonable doubt. However, in offences under section 138 NI
Act, there is a reverse onus clause, which is enshrined in section 118 and section 139 of the Act.
Section 139 of the NI Act further provides presumption in favor of holder and provides 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 legally enforceably debt or other liability.
20 CC No.7908 of 2021, dt:06.06.2025
20.Once the foundational facts that the cheque in question bears the signatures of the accused and the same has been drawn in the account maintained by him are proved, then a factual base is established to invoke the presumption of cheque having being issued in discharge of a legally recoverable debt and drawn for good consideration by virtue of section 118(a) r/w section 139 of NI Act. It is a mandatory presumption, though the accused is entitled to rebut the said presumption.
21.It is the contention of the complainant that the CW1 who is the borrower cum wife cum propritrex of OLIVET FEEDS & CO has obtained open cash credit loan of Rs.25,00,000/- for which the wife of accused/borrower executed necessary documents and on failure in payment of the same the accused has issued cheque bearing registration no.000069, for an amount of Rs.25,00,000/- dt:31-07-2018 which was dishonored as per Ex.P3.
22.As the present case is filed by the Nationalized bank through the complainant, the locustandi of the complainant has to be proved, here the complainant has simply got marked Ex.P1 which is the authorization letter given to D.Sudharshan Reddy by K.Laxma Reddy assistant general manager, but he has not filed any document to show 21 CC No.7908 of 2021, dt:06.06.2025 the authority of Laxma Reddy for giving the authorization letter as a “delegatus non protest delegare” which dictates that a person or entity to whom a power or authority has been delegated cannot further delegate that power to another unless explicity authorized to do so.
The same was admitted by the PW1 in his cross examination. Further the complainant failed to examine the person who had direct knowledge of the present case.
23. As the matter of fact i.e., Ex.P3 which is the cheque bearing
No.000069 dated 31.07.2018 was not disputed but the purpose for which it was given was disputed by both the parties. It is the allegation of the complainant that the wife of accused who is the proprietrix of OLIVET FEEDS & CO approached the complainant for open cash credit loan due to which an amount of Rs.25,00,000/- was advanced to her and further contended that for securing the payment of credit facilities the accused and borrower executed necessary documents in favour of complainant. Stated supra as per the provisions of section 139 of the Act which mandates a presumption that the cheque was issued for discharge of any date or liability, however this presumption u/s 139 is rebuttable presumption and the onus is on the accused to rebut the same.
22 CC No.7908 of 2021, dt:06.06.2025
24.At this stage this court relies on citations of Hon’ble Apex court in
Basalingappa vs. Mudibasappa (2019) 5 SCC 418 as under:
“25. We having noticed the ratio laid down by this court in the above cases on section 118(a) and 139, we now summarise the principles enumerated by this court in the following manner:
25.1 Once the execution of cheque is admitted, Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt of other liability.
25.2. The presumption under section 139 is a rebuttable presumption and the onus is on the accused to raise probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities.
25.3. To rebut the presumption, it is open for the accused to rely on evidence led by him or the accused can also rely on the materials submitted by the complainant in order to raise a probable defence.
Inference of preponderance of probabilities”.
25. On perusal of Ex.P3 it is evident that it was executed in favour of
OLIVET FEEDS & CO for an amount of Rs.4,00,000/- which is issued by the accused/A2. To prove his contention the complainant alleges that the cheque was issued by the accused A2 who is the proprietrix of A1 23 CC No.7908 of 2021, dt:06.06.2025 to discharge the liability of his wife/borrower/CW1. But as per Ex.P2 which is the “written of promise” executed by the borrower dated 31.07.2018, bears only the signature of wife/borrower/CW1 and it is the contention of the accused that the cheque was issued to his wife’s company i.e., OLIVET FEEDS & CO and that the amount which was mentioned in the cheque is already paid to the OLIVET FEEDS & CO.
As such now the onus is on the complainant to prove that the cheque was issued by the accused in discharge of his legally enforceable debt, but in the petition and the chief examination itself it was clearly mentioned that the complainant has advanced loan to wife/borrower/CW1 and not to the accused no.1 or accused no.2.
Further when the accused is able to satisfy the court with the reason shown by him the duty rests on the complainant to prove that the accused himself has given the cheque to the complainant. Though it was clearly averred in the petition that the accused and borrower executed necessary documents in favour of the complainant except the cheque i.e., Ex.P3 none of the documents executed by the accused about the sanctioned loan amount vide account No.019213100000478 bears the signature of accused no.1 and accused no.2 as the guarantor 24 CC No.7908 of 2021, dt:06.06.2025 or surety holder to the wife/borrower/CW1. As such the complainant failed to prove regarding the cheque issued by the accused no.2.
26.Further the counsel for the complainant relied on the eschewed evidence of CW1. As it cannot be said that eschewed evidence has no evidentiary value, it can be considered to the extent of weightage of other evidence adduced by either parties. At this stage it is necessary to go through the contents of written arguments filed by the complainant wherein 9th para 6th line which reads as “As on the date of filing this case she/CW1 was due an amount of Rs.25,00,000/- out of the loan amount. On 31.07.2018 the accused no.2 gave cheque to complainant for Rs.4,00,000/-. The witness/borrower has admitted
Ex.P2 and P3 cheque and letter”. But on perusal of the chief examination of CW1/M.Ratna Kumari it reads that “On 31.07.2018 I gave cheque to the complainant for Rs.4,00,000/-” which means that the complainant mentioned a misleading statement in his written arguments by trying to establish that the accused no.2 himself has given the cheque under Ex.P3 which is quite contrary to the statement made by the CW1/M.Ratna Kumari in her chief examination where in she has stated that she herself gave the cheque to the complainant.
Further it is the contention of the complainant that the borrower and 25 CC No.7908 of 2021, dt:06.06.2025 the accused together came and executed Ex.P2 and Ex.P3 and the accused undertook to honour the cheque for discharging the liability of his wife/borrower i.e., CW1/M.Ratna Kumari, but as per the chief examination of CW1 it is admitted by CW1 that she represented that the cheque would be honoured which means that there is no whisper made by the borrower regarding the involvement of accused no.1 and
2. Further even if considered the version of complainant regarding
Ex.P3 it was issued by the accused in favour of OLIVET FEEDS & CO which was admitted by PW1 and is visible on the face of Ex.P3 but in the cross-examination of PW1, himself has admitted that an amount of
Rs.4,50,000/- was credited into the account of OLIVET FEEDS & CO as claimed by the accused which means that the accused has already discharged his liability to the OLIVET FEEDS & CO. As such the accused has successfully proved his contention.
27.From the case of the complainant, the documents on record and the cross-examination, this court has come to the conclusion that the accused had no legal liability towards PW1. There may have been transactions between the PW1 and the CW1, however, from the material on record, the complainant could not establish the existence of a legally enforceable debt with the accused no.2 representing 26 CC No.7908 of 2021, dt:06.06.2025 accused no.1 and the accused had successfully rebutted the presumption under section 118, 139 and 141 Negotiable Instruments
Act raised against him by cross examination of PW1. As such, this point is answered against the complainant in favour of accused.
POINT No.2:-
28.The other important fact to be established in order to raise the cause of action in this kind of offence is regarding the statutory provision U/sec.138 of NI Act which is two fold, where in firstly, cheque must be issued within specified period mentioned u/sec.138 of NI Act and secondly, cheque must be issued for legally enforceable debt and that the complainant issued a legal notice to the accused and even after the receipt of the said notice, the accused failed to repay the debt. In order to establish the same the complainant got relied on
Ex.P3 to Ex.P8. The cheque i.e., Ex.P.3 was issued on 31.07.2018 which was returned under Ex.P.4, dt:04.08.2018 and Ex.P5 reveals that the complainant got issued a legal notice to the accused on 17.08.2018 informing him about the dishonor of the cheque 03.08.2018 which is within 30 days from the return of the cheque and called upon him to repay the cheque amount within 15 days and Ex.P6 is the postal receipt and Ex.P7 reveals that the same was refused by the accused. It 27 CC No.7908 of 2021, dt:06.06.2025 is the contention of the accused that since he is not concerned with the loan amount he is not bound to receive the legal notice. It can be safely concluded that there is a proper service of legal notice on 18.08.2018 and the complaint is filed on 19.09.2018 and this clearly shows that the complaint was filed within the limitation i.e., within one month from the date after serving legal notice period. The facts of the case reveals that the cheque was presented in Andhra Bank, Kothapet
Branch, Hyderabad and the same is within the jurisdiction of this court.
Thus, this complaint is filed within the limitation and this court has the jurisdiction thereby proving the limitation point of view only. Though the complainant has filed the complaint within the period of limitation, the complainant failed to show the legally enforceable debt as per point no.1. As such it shows that there is no cause of action for the present complaint. Mere proving on the point of limitation under section 138 of NI Act without proving legally enforceable debt would not suffice to establish the present case.
29. Although the accused did not enter the witness box to refute the allegations of the complaint, it is settled law that the accused need not examine himself as a witness and it is sufficient if he is able to show from the material brought on record by the complainant and the cross- 28 CC No.7908 of 2021, dt:06.06.2025 examination of the prosecution witnesses that there existed no legally enforceable debt in favour of the complainant. This point is answered against the complainant in favour of accused.
POINT No.3:-
30. At this stage this court opines that it is pertinent to mention that the Negotiable Instruments Act, 1881 is a powerful tool against the persons who fail to discharge their liability under the Act, but the same cannot be utilised only basing on the presumptions mentioned in the
Act which are totally rebuttable by the accused. The intention of the law makers behind the rebuttable presumptions is to make sure that the holder of an instrument cannot take undue advantage of it simply by basing on the instrument unless he proves that there is an existence of legally enforceable debt and failing to properly evaluate the same is likely to cause extreme sufferance to the accused as the offence U/sec.138 of NI Act not only imposes compensation, but also imposes penal liability by way of imprisonment.
31.From the discussion made above in point no.1 and 2, the complainant failed in establishing the existence of legally enforceable debt or liability for issuance of Ex.P3 against accused no.1 and 2 beyond reasonable doubt. One has to approach the court with clean hands, due to lack of reliable evidence on accused about his 29 CC No.7908 of 2021, dt:06.06.2025 involvement and A2 representing A1 for the offence under section 138 of Negotiable Instruments Act is not even made out raising suspicion in the mind of this court which is sufficient to acquit the accused/A1 and
A2. Accordingly, the point is answered.
29. In the result, accused/ A1 and A2 are found not guilty for the offence punishable under Section 138 of Negotiable Instruments Act and accordingly they are acquitted under section 255(1) of Code of
Criminal Procedure for the said offence. Bail bonds and sureties of accused/ A1 and A2 if any shall stand cancelled after expiry of appeal period.
Dictated to stenographer, transcribed by her, corrected and pronounced by
me in the open court on this the 06 th day of June, 2025.
Sd/-
Spl.J.F.C.M.(Excise)-Cum- V Addl. Junior Civil Judge -Cum- V Addl. Judicial Magistrate, Ranga Reddy(D) at LB Nagar
APPENDIX OF EVIDENCE
WITNESSES EXAMINED
FOR COMPLAINANT :
PW1 : L.Sudhershan Reddy CW1: M.Ratna Kumari (Eschewed)
Exhibits marked on behalf of Prosecution:
Ex.P1: Authorization letter of complainant.
Ex. P2: Original letter of "written promise" by borrower, dt: 31-07-2018.
ExP3: Original cheque Br.no. 000069, dt: 31-07-2018 for complainant.
Ex P4 is the original cheque return memo, dt: (04-08-2018 of Andhra 30 CC No.7908 of 2021, dt:06.06.2025
Bank, Kothapet Branch, Hyderabad in respect of cheque Br.No.
000069,dt:31-07-2018.
ExP5 is the office copy of legal notice, dt: 17-08-2018 sent to residence and business address.
Ex.P6 is the original Regd. post receipt No. RN087953232IN,
RN087953100IN. dt: 18-08-2018 of R.R.District Court complex, Post office.
Ex P7 is the original RPAD postal returned cover from business address,
dt: 24-08-2018.
Ex P8 is the original postal tracking report of RPAD service,
dt: 01-09-2018.
Ex P9 is the copy of regularization of OCC loan A/c. 019213100000478, in Andhra Bank, Kothapet (Original)
Ex P10 is the copy of balance confirmation of Account & Receipt (Original).
Ex P11 is the Loan statement of borrower and bank evidence certificate (Original).
Material Objects: N I LSd/- Spl.J.F.C.M.(Excise)-Cum- V Addl. Junior Civil Judge -Cum- V Addl. Judicial Magistrate, Ranga Reddy(D) at LB Nagar //Attested// Spl.J.F.C.M.(Excise)-Cum-
V Addl. Junior Civil Judge -Cum-
V Addl. Judicial Magistrate, Ranga Reddy(D) at LB Nagar