Court of XX Addl. Chief Metropolitan Magistrate, Bengaluru City: In light of cheque being returned by the bank due to “Account Closed” Bhola Pandit, XX Addl. C.M.M, convicted an accused under Section 138 of the Negotiable Instruments Act, 1881
The present complaint was filed under Section 200 of the Code of Criminal Procedure read with Sections 138, 142 and 143 of the Negotiable Instruments Act against the accused of dishonour of cheque.
Accused had availed hand loan of Rs 3,00,000 from the complainant for his family and legal necessities and agreed to repay the same within 3 months. Even after the completion of three months, the accused did not repay the amount and after several demands and requests, accused issued a cheque but the same was returned by the bank due to “Account Closed” as per banker’s memo.
Thereafter, the complainant got issued a demand notice to the accused and even after that, no repayment has been done by the accused.
Hence, the present complaint was filed within time and had sought to convict the accused by granting compensation under Section 357 of Code of Criminal Procedure double of the cheque amount.
Points for Consideration:
- Does the complainant prove beyond reasonable doubts that, the accused has issued a cheque bearing No.930630 Dated 30.01.2019 for Rs 3,00,000/- towards the discharge of his lawful liability of the complainant and when the said cheque was presented for encashment, it was returned unpaid due to “Account Closed” in the account of the drawer as per banker’s memo and inspite of issuance of demand notice, the accused has failed to pay the cheque amount, thereby has committed the offence punishable under Section 138 of NI Act?
- What Order or sentence?
Analysis, Law and Decision
The Court opined that the statutory presumptions under Sections 118(a) and 139 of the NI Act shall be drawn in favour of the complainant. Accused neither cross-examined PW 1 nor entered in the witness box to rebut the statutory presumptions drawn in favour of the complainant under Sections 118(a) and 139 of the NI Act.
There is no rebuttal evidence on behalf of the accused to disprove the case of the complainant.
Complainant established his case beyond reasonable doubt since he did not deny the financial capacity of the complainant either at the time of explaining to him the substance of the accusation or at the time of recording his statement under Section 313 of the Code of Criminal Procedure. Accused even admitted receiving the demand notice.
Provisions of Section 139 of NI Act contemplates that, ‘There shall be a presumption unless the contrary is proved with the holder of a cheque received for the discharge, in whole or in part of any debt or other liability’.
In the recent judgment, (2021) 5 SCC 283, Kalamani Tex v. P. Balasubramaniyan, the larger bench of the Supreme Court, held that;
“ U/s 118 & 139: Once issuance of cheque and signature admitted, it is required to presume that the cheque was issued as consideration for a legally enforceable debt.”
Hence, Court opined that the accused had borrowed hand loan of Rs 3,00,000 from him towards the discharge of the said loan, the accused had issued the cheque and the said cheque was returned unpaid due to “Account Closed” in the account of the accused. Therefore, point 1 was answered in affirmative.
In view of the above discussion, complainant proved the guilt of the accused punishable under Section 138 NI Act.
Bench stated that it is worth noting that the offence was in nature of civil wrong, therefore it would be proper to award sentence of fine, instead of awarding a sentence of imprisonment.
Court acting under Section 255 (2) of Criminal Procedure Code, convicted accused convicted for the offence punishable under Section 138 of Negotiable Instrument Act and sentenced to pay fine of Rs 3,55,000.
Acting under section 357(1) of code of criminal procedure, it is ordered that an amount of Rs.3,50,000/-(Rupees Three Lakhs Fifty Thousand only) there from shall be paid to the complainant as a compensation, remaining fine amount of Rs.5,000/- (Rupees Five Thousand only) is defrayed to the state for the expenses incurred in the prosecution.
Subject to appeal period the bail bonds stood cancelled. [Purushothama H.C. v. Thotappaji T.S., CC No. 6117 of 2019, decided on 2-12-2021]
Advocates before the Court:
By Sri. B.J. Krishna – Advocate
By Sri. Munishamanna. U – Advocate