IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 15TH DAY OF OCTOBER, 2019 BEFORE THE HON'BLE MR. JUSTICE H. P. SANDESH CRIMINAL APPEAL NO.88 OF 2017 Between:
Mysore Sales International Limited, Chit Funds Division, Having its registered office at: MSIL House, Cunningham Road, Bengaluru-560 052.
Having its Branch at Cunningham Road, Represented by its Authorized Signatory Smt Usha Bhushan Aged about 49 years.
(By Sri. Jeevan Kumar B.S, Advocate) And:
Sri Anandappa T R, Aged 52 years, No.358, Kodigehalli Main Road, Thindlu Village, Vidyaranyapura Post, Bengaluru-560 097.
(By Sri. A. Somaraju, Advocate – Absent) …Appellant ...Respondent This Criminal Appeal is filed under Section 378(4) of Cr.P.C., praying to set aside the judgment and order dated 29.11.2016 passed by the XLII Additional C.M.M., Bengaluru in C.C.No.557/2014 – Acquitting the respondent/accused for the offence punishable under Section 138 of N.I. Act.
This Criminal Appeal coming on for Final Hearing, this day, the Court delivered the following:-
JUDGMENT This appeal is filed by the appellant-complainant challenging the judgment and order of acquittal passed by the XLII Additional Chief Metropolitan Magistrate, Bengaluru City in C.C.No.557/2014 dated 29.11.2016 acquitting the respondent-accused for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the ‘N.I.Act’ for short).
2. Brief facts of the case are that the complainant is a Company incorporated under the Companies Act, 1956 and engaged in chits and finance business. It is the case of the complainant that accused became member with the complainant-company for six chits and did not remit the monthly installments and he was due to pay a sum of Rs.44,76,707/- along with interest and other charges. On repeated request from the complainant, accused had issued a cheque for a sum of Rs.44,76,707/- towards repayment of the amount due to the complainant. The complainant presented the said cheque for encashment and the same was returned with an endorsement ‘insufficient funds’. To that effect, banker issued a memo dated 22.07.2013 and thereafter, the complainant got issued a legal notice dated 20.08.2013 against the accused and inspite of service of notice, accused failed to pay the cheque amount and got issued reply admitting the issuance of cheque and transaction and hence, the complainant has filed a complaint under Section 200 of Cr.P.C for the offence punishable under Section 138 of the N.I. Act. In pursuance of the summons, accused appeared before the Court below and denied the case of the complainant and his plea was recorded and he did not plead guilty and claimed trial. Hence, complainant in order to substantiate its case, got examined witness PW-1 and got marked documents at Exs.P1 to P9 and on closure of complainant’s evidence, the statement under Section 313 of Cr.P.C of the accused was recorded. The accused denied the incriminating evidence and got examined himself as DW1 and got marked document at Ex.D1. The Court below, after considering the oral and documentary evidence, acquitted the accused. Hence, the present appeal is filed before this Court.
3. The appellant-complainant has contended that the Court below has failed to appreciate that the accused has admitted the chit fund transaction and also issuance of cheque at Ex.P2 and that he had made part payment during the pendency of C.C.No.557/2014. The said fact was admitted during the cross- examination of PW1 also and the Court below taking note of the admission with regard to the part payment, doubted the very case of the complainant inspite of transaction being admitted and erroneously comes to the conclusion that the complainant failed to substantiate the claim of Rs.44,76,707/-. The very approach of the Court below is erroneous and it requires interference.
4. Learned counsel for the appellant- complainant in his arguments has reiterated the grounds urged in the appeal and also vehemently contended that a memo was filed before the Court below stating that the answers elicited from the mouth of PW1 regarding payment has already been given deduction in the account extract and the same has not been considered by the court below. The very approach of the Court below is erroneous and the accused in the evidence and also in the cross-examination of PW1 has categorically admitted the transaction and also issuance of the cheque and it is not the case of the accused that there was no such transaction and the Court below ought not to have dismissed the complaint by acquitting the accused and the very finding of the Court below leads to miscarriage of justice and hence, it requires interference of this Court.
5. When the matter was listed for final hearing yesterday i.e., on 14.10.2019, this Court heard the arguments of learned counsel for the appellant- complainant. But the learned counsel appearing for the respondent-accused was absent. Hence, in order to meet the ends of justice, an opportunity was given to learned counsel for the respondent-accused to address his arguments and the matter is listed today. Today also, both in the morning and afternoon session, learned counsel for respondent-accused did not choose to appear before the Court. Hence, the argument of learned counsel for the respondent-accused is taken as ‘nil’.
6. Heard the arguments of learned counsel for the appellant-complainant and on perusal of both oral and documentary evidence, the point that arises for consideration is:
1. Whether the Court below has committed an error in acquitting the accused under Section 138 of the N.I. Act and whether it requires interference by this Court?
2. What Order?
Point Nos.1 and 2:
7. The sum and substance of the complaint averment is that the complainant is a Company incorporated under the Companies Act, 1956 involved in chits and finance business. Accused became the member of the complainant-company for six chit funds and he did not repay the amount and on the insistence of the complainant, he had issued a cheque for a sum of Rs.44,76,707/- towards repayment of the amount due to the complainant. It is also the case of the complainant that accused did not dispute the transaction and also did not dispute the issuance of cheque. Only contention was that accused was not liable to pay the amount of Rs.44,76,707/-. The complainant in order to substantiate its claim examined the company official as PW-1 and got marked the documentary evidence. PW-1 was subjected to cross examination. In his cross examination, accused counsel did not dispute the transaction and it is elicited in the cross-examination that PW-1 in his evidence has admitted several payments to the tune of Rs.11 lakhs in all. It is suggested that the amount mentioned in the cheque and the amount in the account extract does not tally with each other and the same was denied. It is suggested that the accused is liable to pay a sum of Rs.19,90,000/- lakhs including the interest and the same was denied. It is suggested that blank cheque was obtained on the date of bidding of the chit and the same was denied. It is elicited that he cannot tell the date of issuance of cheque by the accused and he says he is not aware of the same. It is suggested that blank cheque was misused and the same was denied. Accused got himself examined as DW-1 and in his evidence, he claims that he became the member of the complainant- company for six chit funds and obtained the amount of Rs.35 lakhs. Out of 35 lakhs, he has paid the amount of Rs.11 lakhs and only a sum of Rs.20 lakhs is due and he is not liable to pay Rs.44,76,707/- as claimed in Ex.P1. He was subjected to cross-examination. In the cross-examination, it is elicited that in terms of Ex.D1, joint memo, he did not repay the amount. But he claims that in respect of chit No.9/5, he has produced the documents for having repaid the entire amount on 29.03.2014. It was suggested to him that he has no documents to show that he has repaid the entire amount and is falsely deposing before the Court but the same was denied. He also admits that he has no documents to show that he was only due for a sum of Rs.20 lakhs. He admits that he and his wife have become the member of the complainant-company for eight chits and took the amount in all the eight chits.
8. Having considered the oral and documentary evidence available on record, it is clear that the accused did not dispute the fact that he had transaction with the complainant. Both in the reply as well as in his evidence before the Court, he has admitted the transaction. It is also elicited in the cross-examination of DW1 that both, the husband and wife became the members of the complainant-company for eight chits and took the amount in all the chits. It is claimed that he paid the amount in respect of some of the chits. It is also his evidence in cross-examination-in-chief that he has taken the amount of Rs.35 lakhs. It is further important to note that in cross-examination-in-chief, he himself says that he has repaid Rs.11 lakhs out of Rs.35 lakhs and claims that due is only Rs.20 lakhs. Even if Rs.11 lakhs is deducted from Rs.35 lakhs, the balance would be Rs.24 lakhs and in the cross-examination also, he admits that he has not produced any documents to show that he was only due for a sum of Rs.20 lakhs. Learned counsel for the appellant also brought to my notice that in terms of reply at Ex.P6, at page No.3, he has admitted the due in a sum of Rs.25 lakhs when the reply was given. The Court below fails to take note of the fact that the amount mentioned in the bank statement, which is marked as Ex.P8, it is shown as Rs.32,24,170/- and the accused also did not dispute the said documents. Accused did not dispute the entries made in Ex.P8. The very claim of the complainant inclusive of the interest amount payable was Rs.44,76,707/-. It is not the case of the accused that he has paid the interest amount and no where in his evidence also he claims that he has paid other than Rs.11 lakhs. PW1 also in his cross-examination has categorically admitted that accused has repaid an amount of Rs.11 lakhs only. Hence, there is no dispute with regard to the payment of Rs.11 lakhs. When the complainant has specifically mentioned that the amount was due as mentioned in the cheque and that the accused had issued a cheque for a sum of Rs.44,76,707/-, the court below ought not to have dismissed the complaint in toto. When there are admissions on the part of the accused, the accused himself in the cross-examination of PW1 suggested that he was due in a sum of Rs.19 lakhs and odd and in his oral evidence, he admits that he has borrowed a loan of Rs.35 lakhs and he has not spoken anything about the interest and when such being the case, the Court below ought not to have dismissed the complaint.
9. Learned counsel for the appellant/complainant today also filed a memo stating that even subsequent to the acquittal, the accused made some of the payment and after deducting the said amount, as on today, he is due in a sum of Rs.32,12,481/-. The complainant is fair enough in bringing to the court notice that the amount of Rs.32,12,481/- is the balance amount, which is inclusive of interest from the date of transaction and when the complainant himself has filed a memo before the court below dated 15.11.2016, the court below ought to have taken note of the same and the same was also not taken note of and no discussion was made about the memo. Hence, it is appropriate to reverse the judgment of the Court below by setting aside the judgment of acquittal.
10. In view of memo filed before this Court, this Court has to take note of the same and reconsider the matter. The reasons assigned by the Court below while dismissing the complaint is nothing but miscarriage of justice. When there are admissions both in oral evidence and also suggesting to the witness PW1 that the accused was due, the Court below has committed an error in acquitting the accused and in coming to the conclusion that the complainant has not proved the amount claimed in the cheque. The Court below has failed to take note of the cross-examination of DW1 wherein, a specific suggestion was made to DW1 that the amount claimed in the cheque is inclusive of interest and the amount was advanced in favour of accused and the same has also not been considered by the Court below. Hence, it requires interference by this Court.
11. In view of the discussions made above, I pass the following:
ORDER i) The appeal is allowed in part.
ii) The accused is convicted for the offence punishable under Section 138 of the N.I. Act.
iii) The accused is directed to pay a sum of Rs.32,12,481/- with interest at 8% p.a. within a period of eight weeks from today.
If the accused fails to pay the amount within the aforesaid period, the accused is sentenced to undergo simple imprisonment for a period of one year.
Sd/- JUDGE dn/-