Bangalore District CourtSmt.Ramamani W/O Chanddrappa vs Smt.Savitha.M. W/O M.K.Shivaram on 10 October, 2017IN THE COURT OF THE LX ADDITIONAL CITY CIVIL &
              SESSIONS JUDGE, BENGALURU
                        (CCH-61)

               Dated this the 10th day of October, 2017

                              :Present:

                   Sri S.K.Vantigodi, B.A., LL.B.,
                LX Addl. City Civil & Sessions Judge,
                             Bengaluru.

                    Crl. Appeal. No. 987 / 2016

Appellant :-                Smt.Ramamani w/o Chanddrappa
                            Aged about 53 years
                            r/o at No.7, 1st Main Road
                            80th Cross Road, Sahara Layout
                            Gubbalala Village
                            4th 'H' Block, BSK 6th Stage
                            Bangalore-560 061
                            (Sri K.P.Chandrashekar Reddy, Adv for
                            appellant)

                                  V/s

RESPONDENT :                 Smt.Savitha.M. w/o M.K.Shivaram
                             Aged about 49 years
                             r/o No.118, 2nd Floor
                             PWD Quarters
                             BTS Road
                             Bangalore-560 027

                       (Sri K.V.Srinivas Reddy, Adv for Respondent)

                            JUDGMENTThis appeal is filed U/sec. 374(3) ofCr.P.C., by the Appellant

being aggrieved by the judgment of conviction and sentence passed
                                   2                     Crl.A. 987/2016



in CC No.5909/2015 dt.02.08.2016 for offenceu/s 138of N.I.Act on

the file of XX ACMM, Bengaluru.2. The Appellant was the accused and respondent herein was

the complainant before the trial Court and they are referred to as per

the ranks assigned to them before the lower court.3. The brief facts leading to this appeal can be stated as

under:-The complainant and accused were known to each other since

ten years. Under the said close acquaintance, accused approached

the complainant in the month of January 2014 for financial

assistance of Rs.5,00,000/- in order to discharge the hand loans

availed by her from different persons at the time of performing

marriage of her daughter in the year 2011. Considering the request

of the accused, complainant lent hand loan of Rs.5,00,000/- to

accused who received the same with a promise that she will repay

the same within 6 to 9 months. Towards discharge of said amount,

the accused has issued a cheque bearing No.471581 dt.1.12.2014

for a sum of Rs.5,00,000/- drawn on Syndicate Bank, H.Siddaiah

Road branch, Bangalore assuring that the same will be honoured on
                                  3                     Crl.A. 987/2016



presentation. Accordingly, the complainant presented the said

cheque on 5.12.2014, which was returned with an endorsement as

"funds insufficient" in the account of accused. Thereafter, the

complainant issued legal notice dt.29.12.2014. In spite of service of

legal notice, the accused neither paid the cheque amount nor replied

the legal notice.As such, the complainant initiated legal proceedings against

the accused for offence punishable U/sec. 138 ofNegotiable

Instruments Act. The learned Magistrate took cognizance and

recorded sworn statement of complainant and registered case

against the accused for offence punishable U/sec. 138 ofNegotiable

Instruments Actand secured the presence of the accused who after

her appearance, denied to plead guilty. Then the complainant

examined herself as PW1 and got marked documents as per Ex.P.1

to Ex.P.6. After recording the statement of accused underSec.313of Cr.P.C., the accused has not lead any defence evidence on her

behalf. Finally, the learned Magistrate after hearing the arguments

on both sides, proceeded to convict the accused for offenceu/s. 138of Negotiable Instruments Act and sentenced her to pay a fine of

Rs.7,60,000/- and in default of payment of fine, accused shall under
                                     4                     Crl.A. 987/2016



S.I.   for    three   months,   besides   awarding   compensation      of

Rs.7,50,000/- out of the fine amount by passing the impugned

judgment dt.2.8.2016.It is this judgment of conviction and sentence which is now

under challenge by the Appellant/accused on the following grounds:-The impugned judgment of conviction and sentence passed

by the trial court is opposed to the settled principles of law, facts and

probabilities of the case.      The learned Magistrate erred in not

appreciating the evidence on record. The judgment of the court

below is based only on presumptions, surmises and conjectures

which are not relevant to the circumstances of the case. Learned

Magistrate grossly erred in holding the accused guilty underSec.138of N.I.Act.    The complainant has not produced any materials nor

examined any witnesses to prove the loan transaction. The

complainant in her cross-examination has stated that she has

received blank cheque and further improved her statement that filled

cheque was given, which leads to ambiguity. The complainant has

admitted that she is not having any documents to show that she was

having amount of Rs.5,00,000/- with her. The learned Magistrate

erred in not holding that the complainant had no sufficient means5                     Crl.A. 987/2016



and capacity to lend such huge hand loan amount. The learned

Magistrate failed to notice that the complainant did not discharge

initial burden of proving that her source of income to lend such huge

amount. Learned Magistrate erred in not properly appreciating the

oral and documentary evidence in proper perspective. Hence,

prayed to set aside the judgment of conviction and sentence and to

acquit the accused by allowing this appeal.4. After filing of this appeal, notice duly served on the

respondent/complainant who made her appearance through a

counsel. The trial Court records have been secured.5. Heard arguments on both sides.6. Perused the records.7. In the light of the contentions taken up in the memorandum

of appeal, the points that arise for my determination are as follows;-1)    Whether the learned Magistrate erred in
                   not properly appreciating the oral and
                   documentary evidence available on record
                   in proper perspective?
                                     6                      Crl.A. 987/2016



             2)    Whether the learned Magistrate erred in
                   not appreciating the defence set up by the
                   accused in proper perspective?

             3)    Are there any grounds to interfere with the
                   order of conviction and sentence?

             4)    What order?8. My findings on the above points are as follows:Points No.1 and 2 :-     In the Negative
             Points No.3 :-    Partly in the Affirmative
             Point No.4:       As per final Order

                              REASONS9. Point No.1 to 3:- All these points are taken together for

discussion for the sake of convenience and to avoid repetition

of facts. Perused the contents of appeal memo, impugned judgment

of conviction as well as the trial Court records.10.     It is the specific case of the complainant that herself

and accused being friends are known to each other since last ten

years. Under her close acquaintance the accused borrowed hand

loan of Rs.5 lakhs in the month of January 2014 from her to

discharge the hand loan and for marriage of her daughter, agreeing

to repay the said amount within six to nine months. When the
                                  7                     Crl.A. 987/2016



complainant insisted for repayment of said hand loan amount after

expiry of stipulated period, accused issued a cheque dt.1.12.2014

for Rs.5,00,000/- towards repayment of said hand loan amount.

When the said cheque was presented for encashment, it came to be

dishonoured for want of sufficient funds in the account of accused.

Then the legal notice was issued to accused, but the accused

neither replied the said notice nor paid the cheque amount. As such

the complainant has prayed to take legal action against the accused

for offence punishable underSec. 138of Negotiable Instruments

Act.11.   On the other hand, the accused has set up two versions

of defence. It is her first defence that the said cheque in fact was

issued as security in favour of complainant towards chit fund

business. It is the second defence set up by the accused that she

obtained hand loan of Rs.20,000/- from complainant in the year

2000 and she had given the blank signed cheque in question as

security to the complainant, who even after repayment of said loan

amount, has not returned the cheque and in turn misused the same

and got filed this false case stating that the cheque in question was

issued towards repayment of hand loan amount of Rs.5,00,000/-.8                    Crl.A. 987/201612.     Keeping in mind the rival contentions of both parties, I

have carefully gone through the entire materials placed on record.

Obviously, burden is on the complainant to prove that the cheque in

question was issued towards discharge of existing loan liability. In

this regard, the complainant examined herself as PW1 who in her

evidence has reiterated the averments of complaint. In her evidence

she got marked the cheque in question as Ex.P.1, bank

endorsement as per Ex.P.2, legal notice as per Ex.P.3, postal

receipt and acknowledgement as per Ex.P.4 and 5 and complaint as

per Ex.P.6.13.     In the cross-examination she states that her husband is

working as clerk at Vidhanasoudha and getting salary of Rs.25,000/-

p.m. and an amount of Rs.10,000/- would be sufficient to meet the

family expenses in a month. She used to save Rs.15,000/- every

month. She does not remember the date on which she had

advanced loan amount. She had kept cash of Rs.5 lakhs in the

house. Her mother used to pay some amount oftenly to her and she

pooled up said amount given by her mother and the savings amount

and kept the same in the house with an intention to purchase

property. Whenever, her parents and family members get good
                                  9                     Crl.A. 987/2016



crops, they used to give an amount of Rs.20,000/- to 50,000/- to her

and she used to save the same since last 4-5 years and kept a sum

of Rs.5 lakhs in the house. She had not obtained any receipt or

other document from the accused for having advanced loan amount.

She admits that the accused had issued blank signed cheque. In the

second breath she says that accused got filed up the cheque in

question and gave it to her. She denied the suggestion that she got

misused the cheque which was given as security while she was

running chit fund business in the year 2000. She denied other

suggestions.14.   A careful appreciation of the evidence of PW1 makes it

clear that the accused has not disputed the issuance of cheque as

well as her signature found on Ex.P.1. She also admits service of

legal notice on her. These facts indicate that the cheque in question

was issued by accused towards repayment of hand loan amount.

Though at one breath she admits the suggestion that the cheque in

question was issued in blank, she immediately states that the

cheque in question was filled up by accused and gave it to her. So,

this admission with regard to handing over of blank signed cheque is

stray admission and does not indicate that it was given only as
                                  10                   Crl.A. 987/2016



security towards any chit fund business. Because, if at all the

cheque in question was issued in blank as security towards chit fund

business, the accused ought to have replied the notice denying its

averments.15.    Even otherwise the accused has not initiated any legal

action against the complainant alleging misuse of cheque by

complainant. Furthermore, the accused has not informed her banker

to stop payment. So, these facts give rise to an inference that the

cheque in question was issued towards repayment of hand loan

amount. Therefore, the facts narrated by PW1 would clearly indicate

that the cheque in question was issued towards repayment of hand

loan amount.16.    Though it is contended that the complainant had no

such capacity to lend such huge amount, the said contention is not

substantiated by any material on record. Because, the complainant

offered explanation stating that she used to save an amount of

Rs.15,000/- p.m. besides amount being paid by her mother every

year whenever they get a bumper crop. So, the say of PW1 that she

pooled up an amount of Rs.5 lakhs since last 4-5 years and kept the

same in the house with an intention to purchase property, is
                                  11                     Crl.A. 987/2016



believable and reasonable one. Therefore, the evidence of PW1

coupled with contents of Ex.P.1 to 6 is sufficient to believe the case

of complainant. As such, learned Magistrate committed no error or

illegality in appreciating the oral and documentary evidence placed

on record by the complainant.17.   On the other hand, in order to rebut the presumption

underSec.138of Negotiable Instruments Act, the accused

examined herself as DW1 who in her evidence has spoken to the

facts that she had borrowed an amount of Rs.20,000/- in the year

2000 by giving Ex.P.1 as security. Though she repaid that amount in

the month of February 2000, the complainant has not returned the

cheque and in turn got filed this false case by misusing the said

cheque. In her cross-examination, she admits that she knows

complainant since several years. She was staying at KSRTC

quarters, 9th Block, Bengaluru from 2000-2010. Her husband is a

retired BMTC Cashier. She performed the marriage of her elder

daughter in the year 2011. She admits that Ex.P.1(a) is her

signature. Hand writing found on Ex.P.1 does not pertain to her. She

admits that the signature found on postal acknowledgement Ex.P.5

pertains to her. She denied the other suggestions.12                     Crl.A. 987/201618.    On careful appreciation of evidence of DW1, it can be

said that her evidence does not indicate that the cheque in question

was issued only as security towards hand loan of Rs.20,000/-.

Because, if really she had issued Ex.P.1 signed blank cheque as

security while borrowing loan amount of Rs.20,000/- in the year 2000

itself, she would not have kept mum without insisting complainant to

return said cheque till the year 2014. Even she has not approached

police soon after the service of legal notice alleging misuse of

cheque by complainant. So, the conduct of accused in not initiating

any legal action, not replying the legal notice itself indicates that the

cheque in question was not issued as security, but it was issued

towards repayment of hand loan amount of Rs.5,00,000/-.

Therefore, defence set up by the accused is not probable and

believable one.19.    Furthermore, in her evidence DW1 has come up with

the defence that the cheque in question was issued as security while

borrowing hand loan of Rs.20,000/- in the year 2000. Whereas, in

the cross-examination of PW1, it is suggested to complainant that

the cheque in question was issued as security while the complainant

was running chit fund business. Both these contentions are contrary
                                     13                        Crl.A. 987/2016



to each other and create doubt as to the genuineness of the defence

set up by the accused. So, inconsistent defence set up by the

accused in denying the case of the complainant, indicates that she

intends to overcome the liability of repayment of loan amount in one

or the other way, which she failed in her attempt to disprove the case

of the complainant. Therefore, the accused has failed to rebut the

presumption available underSec.139of Negotiable Instruments Act

in favour of complainant.20.    Having carefully appreciated the oral and documentary

evidence available on record, I am of the view that the learned

Magistrate committed no error or illegality in appreciating the oral

and   documentary      evidence    available    on   record      in   proper

perspective. Absolutely, there are no reasons to form opinion that

the learned Magistrate failed to attach any importance to the

defence set up by the accused. The learned Magistrate has

appreciated the rival contentions of both the parties in proper

perspective relying on the oral and documentary evidence.

Therefore, the impugned judgment of conviction is in accordance

with the settled principle of law, facts and probabilities.14                     Crl.A. 987/201621.   Learned Counsel for appellant during the course of

arguments has relied on the following authorities:-1) 2014 AIR SCW 2158 in the case ofJohan K.Abrahan Vs.

        Simon C.Abraham and another2) ILR 2009 KAR 172 in the case ofSri A.Viswanatha Pai Vs.

        Sri Vivekananda S.Bhat3) 2008 AIR SCW 738 in the case ofKrishna Janardhan Bhat

        Vs. Dattatraya G.Hedge4) AIR 2008(NOC) 2327 (Bombay) in the case ofSanjay

        Mishra Vs. Ms.Kanishka Kapoor @ Nikki @ another5) IV (2007) BC 211 in the case ofSantosh Manikrao Gundale

        Vs. Rameshwar Wamanrao Takand other6) Judgment in Appeal No.772/2016 passed by LXVII City

        Civil and Sessions Judge (CCH-68), Bengaluru.I have carefully gone through the above said authorities. I do

admit the proposition of lawlaid down inthe above said authorities.

But the facts involved in the case on hand are entirely different to the

facts involved in the above said authorities. Therefore, theratiolaid

down inthe above authorities is not aptly applicable to the case on

hand.15                   Crl.A. 987/201622.   However, while imposing such fine, the learned

magistrate has not assigned any reasons. Because, though the

cheque in question was issued towards repayment of hand loan of

Rs.5,00,000/-, the learned Magistrate has sentenced the accused to

pay fine of Rs.7,60,000/- without assigning any reasons to impose

fine amount in excess of cheque amount. Herein this case, the facts

involved indicate that the hand loan transaction has taken place

under the guise of close friendship of complainant with the accused.

Admittedly, the complainant is not charging any interest on the hand

loan amount. The very fact that the complainant has not obtained

any receipt or document as security towards loan transaction itself

indicates that the complainant had no intention to gain any profit or

interest out of the loan transaction.   Such being the situation, the

complainant lent such loan amount to accused only to enable her to

discharge her debt incurred towards the marriage of her daughter.

Therefore, the complainant had no intention of making any profit by

advancing such loan amount to the accused. Such being the fact,

there was no reason to impose such fine amount on the accused. As

such, the learned Magistrate erred in imposing fine amount in

excess of cheque amount i.e., fine of Rs.7,60,000/-. Hence, the
                                     16                    Crl.A. 987/2016



impugned judgment of conviction and sentence needs to be

interfered with in regard to the quantum of fine imposed on the

accused.23.    Furthermore, the thing would have been different if the

learned     Magistrate   assigned        any   reasons   for   awarding

compensation in excess the cheque amount. As such, the learned

Magistrate is not justified in awarding compensation in excess of the

cheque amount without assigning any reasons to that effect. So, on

these facts, I am of the view that the impugned order of sentence

deserves to be interfered so as to modify the fine and quantum of

compensation awarded to complainant. Therefore, considering the

fact that the transaction has taken place between the complainant

and the accused under close friendship, I feel that the accused shall

be directed to pay fine of Rs.5,10,000/- instead of Rs.7,60,000/- as

imposed. Hence, the impugned order of sentence deserves to be

interfered only with regard to quantum of fine and compensation

awarded by learned Magistrate. Hence, impugned judgment of

conviction deserves to be confirmed with by modifying the quantum

of sentence as observed above. Accordingly, I answer point No.1

and 2 in the negative and point No.3 partly in the affirmative.17                      Crl.A. 987/201624.   Point No.4: In view of my findings on point No.1 to 3, I

proceed to pass the following:ORDER

             The appeal filed by appellants U/sec. 374 ofCode
       of Criminal Procedureis hereby allowed in part.The     impugned      judgment     of   conviction    and
       sentence passed by the XX ACMM, Bengaluru, in CC
       No.5909/2015 dt.02.08.2016 stands modified as under:-Actingu/s. 255(2)of Cr.P.C, the accused is hereby
       convicted and sentenced to pay fine of Rs.5,10,000/- for
       the   offence    punishable     U/Sec.138of   Negotiable
       Instruments Act and in default of payment of fine amount,
       the accused shall undergo S.I. for a period of three
       months.Out of the fine amount, a sum of Rs.5,00,000/- is
       ordered to be paid as compensation to the complainant
       underSec.357of Cr.P.C., and remaining Rs.10,000/-
       shall be appropriated to the government.Send a copy of this judgment to the lower Court
       along with LCR.(Dictated to the Judgment Writer, transcribed and typed by him,
corrected and then pronounced by me in the open court on this the 10th day of
October, 2017)



                                           (S.K. VANTIGODI)
                                      LX Addl.City Civil & Sessions
                                           Judge, Bengaluru.Rrt*