Mallayya vs Esharappa

The present petition has been filed by the petitioner-accused being aggrieved by the judgment and order passed by Sessions Judge at Yadgiri in Crl.A.No.7/2013 dated 17.08.2016 whereunder the judgment of conviction passed by the JMFC Court, Shahahpur in C.C.No.437/2009 by order dated 9.10.2013 convicted the accused-petitioner under Section 138 of Negotiable Instruments Act ( For short '' N.I. Act'')

The brief facts of the case as per the complaint are that; the respondent-complainant and petitioner-accused known to each other and accused requested the complainant for loan of Rs.4,00,000/- for the purpose of agricultural activities, irrigation and for development of the land. After receiving the said amount, accused agreed to repay the same within one month and thereafter he issued a cheque of State Bank of India, Gogi Branch dated 4.6.2009. When the said cheque was presented on 25.6.2009 the same was returned with an endorsement as "Funds Insufficient". Thereafter, the complainant issued a legal notice to the accused for demanding the loan amount. Though, the notice served, accused did not pay the loan amount or replied to the said legal notice within stipulated time, as such, a complaint came to be filed by the complainant under Section 138 of N.I. Act.

After filing of the complaint, the trial Court took the cognizance and after recording the sworn statement of the complainant, summons came to be issued to the accused, accused appeared before the Court and after recording the plea, the trial Court by judgment dated 9.10.2013 convicted the accused. Being aggrieved by the said judgment of conviction preferred appeal before the Sessions Court, Yadgiri in Crl.A.No.7/2013. The learned Sessions Judge by order dated 17.8.2016, dismissed the appeal by confirming the order of the trial Court. Being aggrieved by the said order of dismissal of appeal, the petitioner-accused is before this Court.

I have heard both the learned counsel, perused the records including the orders passed by the courts below.

The main grounds urged by the learned counsel for the petitioner are, that the impugned order is not logical and based upon any reasons, as such, the same is liable to be set aside. He would further contend that though there is no financial transactions between the accused and the complainant, the trial Court misled the facts and circumstances and has wrongly convicted the accused-appellant. He would further contend that the petitioner was ready to pay the loan of Rs.2,00,000/-, but the complainant-respondent refused to receive the said loan amount and by using the blank cheque given by the petitioner-accused, the complainant-respondent has himself filled the chque in figures and thereafter presented the same before the Bank for encashment and the same was dishonored. Since the said cheque was filled up by the complainant himself, there is no prima face case made out by the complainant and the impugned orders are liable to be set aside. He would further contend that the sentence which has been imposed is on the higher side and the same may kindly be reduced. On these grounds, he prayed for allowing the petition.

Per contra, the learned counsel for the respondent-complainant vehemently argued and contended that complainant had advanced the loan to the petitioner-accused. Thereafter, the said amount has not been returned, as such, accused issued the cheque and when it was presented, the same was dishonored with an endorsement " Funds Insufficient". Thereafter, a legal notice was issued demanding to repay the said loan amount. But, in spite of service of notice, the accused did not repay the said amount, as such, a complaint was filed and the trial Court after considering all the material has come to the conclusion that the accused has issued the cheque for discharging the liabilities, which is legally enforceable debt. The trial Court after going through the records and on merits has rightly come to the right conclusion and has convicted the accused. The learned counsel further contended that the trial Court after considering the cheque amount and the provisions of N.I. Act rightly imposed proper sentence and as such the same cannot be reduced. On these grounds, he prayed for dismissal of the petition by confirming the order of both the courts.

I have gone through the entire records carefully and cautiously and also perused the impugned orders of both the courts below. It is not in dispute that the accused has issued the cheque, Ex.P-1 and it is also not in dispute that the said cheque has been submitted for encashment and it returned with an endorsement "Funds Insufficient". It is also not in dispute that the notice was also came to be issued as per Ex.P-3 and the same was served on the accused. Thereafter, he did not pay the said loan amount. As could be seen from the records the issuance of the cheque by the petitioner is admitted and so also the signature on Ex.P-1. The defence of the petitioner is that he has issued the cheque in favour of one Baswaraj and not in favour of the complainant. The said Baswaraj in collusion with the consent passed on the cheque to the complainant and subsequently the complainant has used the said cheqeu and has filed a false complaint. Though the petitioner has contended that he has issued the chqeue in favour of one Baswaraj for a sum of Rs.2,00,000/- and the same has been misused by the complainant, but in order to substantiate the said fact, he has not produced any corroborative evidence before the Court.

Be that as it may. The accused has admitted the signature on Ex.P-1 and when once the accused admits his signature on Ex.P-1, then under such circumstances, the provision under Section 138 of N.I. Act and Section 139 of N.I. Act are attract. The Court has to draw the presumption that the cheque has been issued for discharge of debt or liability. Then burden shifts upon the accused to disprove or proves his contention on preponderance of probabilities. When once he fails to prove his case, then under such circumstances, the ingredient under Section 138 of N.I. Act is said to have been proved and accused is liable for conviction. Though it is contended that the complainant himself has filled up the cheque and presented the same for encashment, but when once the cheque has been signed and if it is handed over to the holder of the cheque as per Section 20 of the N.I. Act, it enables the holder to fill it present the same to the bank. When that being the position of law, then under such circumstances, the contention of the accused that, the cheque which has been issued in favour of one Baswaraj has been filled up by the complainant himself and has been misused also not going to hold any water.

I have gone through the reasons afforded by both the courts below. The reasons assigned by the trial Court are not based on surmises or conjectures and it is based upon well reasoning. When there is a clear case established as against the petitioner under Section 138 of N.I. Act and the accused failed to prove his contentions which has been taken in his defence, then under such circumstances, offence under Section 138 of N.I. Act is said to have been proved and the trial Court has rightly convicted the accused. It is the contention of the leaned counsel for the petitioner that the trial Court has imposed disproportionate sentence by imposing Rs.8,00,000/- i.e., double the cheque amount.

As per Section 138 of N.I. Act when once the offence has been proved, then under such circumstances, the Court can punish the accused with imprisonment for a term which may extend to two years or with fine which may extend to twice the amount of cheque or with both. When admittedly, the cheque in question is issued for a sum of Rs.4,00,000/- and the trial Court has imposed fine of Rs.8,00,000/- i.e., twice the cheque amount. Under such circumstances, there is no abnormality or excessiveness while imposing the punishment by the trial Court. Under such circumstances, the said contention of the learned counsel for the petitioner also does not appears to be acceptable in law. For the reasons stated and discussed above, there is no merits to interfere with the orders of the trial Court, as such, the petition stands dismissed.

No order as to costs.