BEFORE THE HON'BLE MR. JUSTICE v. SRISHANANDA CRL.R.P.No
Case Details
1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 07TH DAY OF JANUARY, 2025 BEFORE THE HON'BLE MR. JUSTICE V. SRISHANANDA CRL.R.P.No.1021/2021 C/W CRL.R.P.No.1058/2021 IN CRL.R.P.NO.1021/2021 BETWEEN: 1 . H G SUMAN S/O H B GOPAL AGED ABOUT 36 YEARS, R/AT HALASE VILLAGE AND POST, MUDIGERE TALUK CHIKKAMAGALURU DISTRICT-577132 (BY MISS.N.VANDANA FOR SRI HARISHA.A.S, ADVOCATES) ...PETITIONER AND 1 . VINCENT PINTO S/O LATE J PINTO AGED ABOUT 58 YEARS COFFEE PLANTER R/A HUDUGANAHALLI KHAN ESTATE, GABGUL POST VIA MAGUNDI MUDIGERE TALUK CHIKKAMAGALURU DISTRICT-577132 (BY SRI H.N.MANJUNATH PRASAD, ADVOCATE) …RESPONDENT 2 THIS CRL.RP IS FILED UNDER SECTION 397 R/W 401 CR.P.C PRAYING TO SET ASIDE THE JUDGMENT DATED 16.08.2021 PASSED BY THE LEARNED II ADDITIONAL DISTRICT JUDGE, CHIKKAMAGALURU IN CRL.A.NO.35/2020 AND ALSO THE JUDGMENT OF CONVICTION AND ORDER OF SENTENCE DATED 03.01.2020 PASSED BY THE SENIOR CIVIL JUDGE AND J.M.F.C., MUDIGERE IN C.C.NO.188/2019 AND CONSEQUENTLY ACQUIT THE PETITIONER FOR THE CHARGES WITH WHICH THEY STOOD CHARGE. SESSIONS AND IN CRL.RP.NO.1058/2021 BETWEEN 1 . H G SUMAN S/O H B GOPAL AGED ABOUT 36 YEARS, R/AT HALASE VILLAGE AND POST MUDIGERE TALUK CHIKKAMAGALURU DISTRICT-577132 (BY MISS N.VANDANA, FOR SRI HARISHA.A.S, ADVOCATES) ...PETITIONER AND 1 . VINCENT PINTO S/O LATE J PINTO AGED ABOUT 58 YEARS, R/A HUDUGANAHALLI KHAN ESTATE GABGUL POST, VIA MAGUNDI MUDIGERE TALUK CHIKKAMAGALURU DISTRICT-577 122 (BY SRI H.N.MANJUNATH PRASAD, ADVOCATE) …RESPONDENT 3 THIS CRL.RP IS FILED UNDER SECTION 397 R/W 401 CR.P.C PRAYING TO SET ASIDE THE JUDGMENT II DATED 16.08.2021 PASSED BY THE LEARNED ADDITIONAL DISTRICT JUDGE, CHIKKAMAGALURU IN CRL.A.NO.36/2020 AND ALSO THE JUDGMENT OF CONVICTION AND ORDER OF SENTENCE DATED 03.01.2020 PASSED BY THE SENIOR CIVIL JUDGE AND J.M.F.C., MUDIGERE IN C.C.NO.187/2019 AND CONSEQUENTLY ACQUIT THE PETITIONER FOR THE CHARGES WITH WHICH THEY STOOD CHARGE. SESSIONS AND THESE PETITIONS HAVING BEEN RESERVED FOR ORDERS, COMING ON FOR PRONOUNCEMENT THIS DAY, THE COURT PRONOUNCED THE FOLLOWING:- CORAM: HON'BLE MR JUSTICE V SRISHANANDA CAV ORDER (PER: HON'BLE MR JUSTICE V SRISHANANDA) These two revision petitions are filed by the common accused against the common complainant but in two different criminal cases, whereby accused/revision petitioner has been convicted for the offence punishable under Section 138 of Negotiable Instruments Act in C.C.No.188/2019 and in C.C.No.187/2019 and whereby directed to pay fine amount of Rs.59,00,000/- and with default sentence of simple imprisonment for two months, out of which Rs.58,90,000/- was ordered to be paid as 4 compensation and balance amount of Rs.10,000/- towards defraying expenses of the State and Rs.30,50,000/- was ordered to be paid as compensation and balance amount of Rs.10,000/- towards defraying expenses of the State with default sentence of simple imprisonment for the period of two months respectively. 2. Facts in nutshell in respect of both the cases are as under: Two separate complaints came to be lodged under Section 200 Cr.P.C., alleging the commission of the offence punishable under Section 138 of Negotiable Instruments Act, contending that complainant is a coffee planter, possessing coffee estate and he is growing coffee and pepper crops in his estate. Accused is in the business of dealing of coffee beans at Mudigere. In the year 2008 accused approached the complainant in C.C.No.188/2019 and purchased 2280 bags of Robusta cherry coffee at the rate of Rs.2,500/- per bag, total value being sum of Rs.57,74,976/- and paid a sum of Rs.9,50,000/- and 5 assured to pay the remaining amount of Rs.48,00,000/- and purchased pepper weighing 6093.6 kilograms at the rate of Rs.160/- per kilogram, total value being Rs.9,74,976/-. 3. In C.C.No.187/2019 accused approached the complainant and purchased 2321 bags of Robusta cherry coffee at the rate of Rs.1,800/- per bag, total value being sum of Rs.41,77,800/- and paid a sum of Rs.25,00,000/- and assured to pay the remaining amount of Rs.16,77,800/-. 4. Towards payment of said amount in both the cases, accused issued cheques bearing Nos.594157, 625746, dated 30.05.2011 and 28/02/2011, in a sum of Rs.57,74,976/- and Rs.29,42,800/- respectively, drawn on Karnataka Bank, Niduwale Branch, which on presentation returned with an endorsement ‘Funds Insufficient’. 5. Separate legal notices were issued calling upon the accused to repay the amount and there was no reply 6 nor compliance of the callings of the legal notice and therefore, action was sought. 6. Learned Trial Magistrate after completing the formalities summoned the accused. Accused appeared and engaged the services of an Advocate. Thereafter, plea was recorded. Accused pleaded not guilty. Therefore, trial was held separately in both the cases. 7. In C.C.No.188/2019 complainant is examined
Legal Reasoning
is before this Court in this revision. 26. Sri Harisha A.S., learned counsel for the revision petitioner reiterating the grounds urged in the revision petition vehemently contended that both the Courts erred in law in not appreciating the material evidence properly on record. 27. He further contended that there was no compliance to the provisions of Section 138(b) of Negotiable Instruments Act which is a sine qua non for taking cognizance of the offence punishable under Section 138 of Negotiable Instruments Act. Therefore, entire trial stood vitiated and sought for allowing the revision petition. 14 28. He also pointed out that admittedly, the legal notice has been issued through registered post and courier. P.W.1 has admitted that he cannot identify the signature in column No.3 of the courier acknowledgment slip which shows that there was no proper service of notice and hence, the order of conviction is incorrect resulting in miscarriage of justice and sought for allowing the revision petition. 29. Per contra, counsel for respondent supported the impugned orders in both the cases. 30. He further contended that in the cross- examination accused has admitted the transaction of purchase of coffee in the year 2008 and he had repaid the money and cheque given by him at that juncture has been misused by the complainant which is not proved by the accused. 31. He further pointed out that there is a clear admission by accused himself that he has not lodged any 15 complaint to the police about the alleged misuse and sought for dismissal of the revision petition. 32. Having heard the parties in detail, this Court perused the material on record meticulously. 33. On such perusal of the material on record, following points would arise for consideration: 1) Whether the revision petitioner has made out a case that the impugned judgment in both the cases are suffering from legal infirmity and perversity and thus calls for interference? 2) Whether the sentence is excessive? 3) What order? 34. Regarding point No.1: In the case on hand, accused is known to the complainant. There is a clear admission in the cross-examination of accused that he had purchased the coffee in the year 2008 and towards payment of the value of the coffee, he has paid the amount in cash, but accused failed to return the cheques which was given as security. If it is so, soon after the 16 receipt of notice or at least when the accused has appeared before the Court and engaged the services of an Advocate, should have taken some positive action against the complainant for misuse of the cheque. But, no such action has been taken by the accused. 35. Admittedly, cheques belongs to the accused and signature found therein is that of the accused. Cheques are dishonored for want of ‘Funds insufficient’. Therefore, based on the documentary evidence placed on record by the complainant, the learned Trial Magistrate was justified in raising the presumption under Section 139 of Negotiable Instruments Act. 36. No doubt it is a rebuttable presumption. In order to rebut the presumption, the stand taken by the accused is that the cheques were misused by the complainant. 37. In the absence of any positive action on the part of the accused for the alleged misuse, the learned 17 Trial Magistrate was of the considered opinion that the theory of misuse not established by placing cogent evidence on record. 38. Cheques amount is in sum of Rs.29,42,800/- and Rs.57,749,76/- in both the cases. No normal prudent person would keep quiet if cheques are misused that too in a huge amount for Rs.29,42,800/- and Rs.57,749,76/-. Moreover, accused is a business man. He knew the consequences of issuance of cheque and misuse thereof. Therefore, the defence raised by the accused was thus not established by placing cogent evidence on record. 39. Yet another point that the counsel for accused
Arguments
as P.W.1 and Sri Iqbal Ahamed as P.W.2. In C.C.No.187/2019 complainant is examined as P.W.1 and Sri Nanjegowda is examined as P.W.2. In both the cases complainant placed documentary evidence on record which were exhibited and marked as Exs.P.1 to P.29 and Exs.P.1 to P.22 respectively. 8. In the cross-examination of P.W.1, it has been elicited that P.W.1 is unable to say exact date of the coffee beans and pepper were sold to the accused. 7 9. He has also answered that he has written in a book about the sale of coffee and pepper, but said book is misplaced. He has answered that in the year 2009-10 he had sold the coffee and despite there was due, he has again sold the coffee in the next year. He has answered that he is not remembering what is the rate of coffee per kilogram. He has further answered that he has not shown the quantity of coffee grown in his estate for the year 2009-10 in the complaint. He has further answered that the legal notice was sent to the accused through registered post and courier. He has failed to identify the signature in Ex.P.7 in column No.3. He denied the suggestion that in collusion with the Courier Agent, he has concocted Exs.P.6 and P.7. He had answered that apart from the cheque, the accused has given a written letter. 10. Likewise, in the cross-examination of P.W.1 in C.C.No.187/2019, complainant has answered that at the time of filing the case, bag containing 50 kilograms of coffee beans was being sold at Rs.1,800/-. He has 8 answered that in the year 2008 he had 35 acres of coffee estate and he was growing Robusto coffee and roughly about 50 kilograms of coffee beans would be grown in one acre of the land. 11. He admits that the cheques were not given by the accused on the date of sale of coffee. He admits that he had obtained cash of Rs.25,00,000/- as against the sale of 41,77,800/- worth coffee. To a specific question that after obtaining Rs.25,00,000/- lakhs whether the cheque was issued for the balance amount, witness has answered that the cheque amount involved in C.C.No.187/2019 was based on the balance amount and the amount that was due from the accused for the year 2009. 12. He has specifically answered that in the year 2008 he had sold the coffee at the rate of Rs.2280/- per bag and he does not remember exact number of bags which were sold in the year 2008. He has further answered that in the year 2010 he has sold 2321 bags of coffee. 9 13. He denied the suggestion that he has filed a case stating that because of passing of high tension wire over his coffee estate, he has filed a petition for compensation. 14. He denies the suggestion that accused never purchased coffee from the complainant and therefore, accused is not liable to pay the amount. 15. Sri B. Nanjegowda, Assistant Sub Inspector of Police, who had searched for the accused as he was absconding, has been examined as P.W.2 and his evidence was also recorded under Section 299 Cr.P.C., and therefore, there was no cross-examination. 16. Learned Trial Magistrate has recorded the accused statement in both the cases as is contemplated under Section 313 Cr.P.C., wherein accused has denied the incriminatory circumstances in both the cases and choose to examine himself as D.W.1 in both the cases. 10 17. In his examination-in-chief, he has stated that he had purchased the coffee in the year 2007-08 and at that juncture, he had issued the cheque in question and he had repaid the money, but accused had not returned the cheque which was given in blank. 18. It is his specific case that the complainant has misused the cheque and he had not purchased the coffee in the year 2010-11 and for that purpose he has issued the cheque in question. 19. In the cross-examination, he has specifically admits that he cannot say the numbers of four cheques which have been issued by him to the complainant. He has however answered that two cheques have been misused by the complainant and balance two cheques has been misused through Sri Joys Saldana. 20. He admits that he had not lodged any complaint against the complainant for alleged misuse of the cheques. He admits that in Ex.P.8, the address 11 mentioned is his address. He admits that Mudigere police had arrested him from Bengaluru and later on he was enlarged on bail and at that Juncture, one Sri Upendra had stood as surety for him. 21. He further admits that when he jumped the bail, police had again arrested him and produced him before the Court. 22. Based on the above evidence on record, learned Trial Magistrate heard the parties and on consideration of the oral and documentary evidence, convicted the accused and sentenced as under in both the cases. C.C.No.188/2019 “Acting u/s.255(2) of Cr.P.C., the accused is hereby convicted for the offence punishable u/s.138 of the Negotiable Instrument Act. Accused is sentenced to undergo simple imprisonment for one year and to pay fine of Rs.59,00,000/- and in default of payment of fine he shall undergo SI for the period of 2 months. 12 If fine amount is recovered from accused, out of the fine amount Rs.58,90,000/- shall be given to the complainant as per section 357(1) of Cr.P.C. and Rs.10,000/- shall be confiscated to the State. The bail bond and surety bond of the accused is hereby stands cancelled.” CC No.187/2019 “Acting u/s.255(2) of Cr.P.C., the accused is hereby convicted for the offence punishable u/s.138 of the Negotiable Instrument Act. Accused is sentenced to undergo simple imprisonment for one year and to pay fine of Rs.30,50,000/- and in default of payment of fine he shall undergo SI for the period of 2 months. If fine amount is recovered from accused, out of the fine amount Rs.30,40,000/- shall be given to the complainant as per section 357(1) of Cr.P.C. and Rs.10,000/- shall be confiscated to the state.” The bail bond and surety bond of the accused is hereby stands cancelled.” 23. Being aggrieved by the same, accused preferred appeals before the II Additional District and Sessions Judge in Crl.A.No.35/2020 and Crl.A.No.36/2020 respectively. 13 24. Learned Judge in the First Appellate Court after securing the records, heard the parties in detail and by judgment dated 16th August, 2021 dismissed both the appeals and upheld the order of conviction passed by learned Trial Magistrate. 25. Being further aggrieved by the same, accused
Decision
has urged before this Court to assail the impugned order is the improper service of notice, resulting in vitiating the trial as taking of cognizance was impermissible. 40. In that regard, learned counsel for the revision petitioner placed reliance on provisions of Section 138(b) of Negotiable Instruments Act. 18 41. In the case on hand, the legal notice was sent to the accused through registered post acknowledgement due (RPAD). D.W.1 has admitted that the address mentioned in the cover is that of his address. Notice was also sent through courier service. 42. On careful perusal of the returned RPAD cover it is seen that the postman has endorsed that the addressee did not claim the notice. 43. In the case of K. Bhaskaran v. Sankaran Vaidhyan Balan reported in (1999) 7 SCC 510, the Hon’ble Apex Court has held as under: 17. The more important point to be decided in this case is whether the cause of action has arisen at all as the notice sent by the complainant to the accused was returned as “unclaimed”. The conditions pertaining to the notice to be given to the drawer, have been formulated and incorporated in clauses (b) to (c) of the proviso to Section 138 of the Act. The said clauses are extracted below: “(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount 19 of money by giving a notice in writing, to the drawer of the cheque, within fifteen days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and (c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice.” 23. Here the notice is returned as unclaimed and not as refused. Will there be any significant difference between the two so far as the presumption of service is concerned? In this connection a reference to Section 27 of the General Clauses Act will be useful. The section reads thus: “27. Meaning of service by post.—Where any Central Act or Regulation made after the commencement of this Act authorises or requires any document to be served by post, whether the expression ‘serve’ or either of the expressions ‘give’ or ‘send’ or any other expression is used, then, unless a different intention appears, the service shall be deemed to be effected by properly addressing, pre-paying and posting by 20 registered post, a letter containing the document, and unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post.” 24. No doubt Section 138 of the Act does not require that the notice should be given only by “post”. Nonetheless the principle incorporated in Section 27 (quoted above) can profitably be imported in a case where the sender has despatched the notice by post with the correct address written on it. Then it can be deemed to have been served on the sendee unless he proves that it was not really served and that he was not responsible for such non-service. Any other interpretation can lead to a very tenuous position as the drawer of the cheque who is liable to pay the amount would resort to the strategy of subterfuge by successfully avoiding the notice. 25. Thus, when a notice is returned by the sendee as unclaimed such date would be the commencing date in reckoning the period of 15 days contemplated in clause (c) to the proviso of Section 138 of the Act. Of course such reckoning would be without prejudice to the right of the drawer of the cheque to show that he had no knowledge that the notice was brought to his address. In the present case the accused did not 21 even attempt to discharge the burden to rebut the aforesaid presumption. 44. Likewise, in the case of V. Raja Kumari v. P. Subbarama Naidu, reported in (2004) 8 SCC 774, wherein the Hon’ble Apex Court has held as under: “8. On the part of the payee he has to make a demand by “giving a notice” in writing. If that was the only requirement to complete the offence on the failure of the drawer to pay the cheque amount within 15 days from the date of such “giving”, the travails of the prosecution would have been very much lessened. But the legislature says that failure on the part of the drawer to pay the amount should be within 15 days “of the receipt” of the said notice. It is, therefore, clear that “giving notice” in the context is not the same as receipt of notice. Giving is a process of which receipt is the accomplishment. It is for the payee to perform the former process by sending the notice to the drawer at the correct address. 9. In Black's Law Dictionary “giving of notice” is distinguished from receiving of the notice (vide p. 621): “A person notifies or gives notice to another by taking such steps as may be reasonably required to inform the other in the ordinary course, whether or not such other actually comes to know of it.” A person “receives” a notice when it is duly delivered to him or at the place of his business.” If a strict interpretation is given that the 10. drawer should have actually received the notice for the 22 period of 15 days to start running no matter that the payee sent the notice on the correct address, a trickster cheque drawer would get the premium to avoid receiving the notice by different strategies and he could escape from the legal consequences of Section 138 of the Act. It must be borne in mind that the court should not adopt an interpretation which helps a dishonest evader, and clips an honest payee as that would defeat the very legislative measure. 14. No doubt Section 138 of the Act does not require that the notice should be given only by “post”. Nonetheless the principle incorporated in Section 27 (quoted above) can profitably be imported in a case where the sender has dispatched the notice by post with the correct address written on it. Then it can be deemed to have been served on the sendee unless he proves that it was not really served and that he was not responsible for such non-service. Any other interpretation can lead to a very tenuous position as the drawer of the cheque who is liable to pay the amount would resort to the strategy of subterfuge by successfully avoiding the notice. 18. In Madhu v. Omega Pipes Ltd. [(1994) 1 An LT (Cri) 603 (Ker)] the scope and ambit of Section 138 clauses (b) and (c) of the Act were noted by the Kerala High Court and Justice K.T. Thomas (as His Lordship then was) observed as follows : (An LT p. 606, para 7) “[I]n clause (c) of the proviso the drawer of the cheque is given fifteen days from the date ‘of receipt of the said notice’ for making payment. This affords clear indication that ‘giving notice’ in the context is not the same as receipt of notice. Giving is the process of which receipt is the 23 accomplishment. The payee has to perform the former process by sending the notice to the drawer in his correct address. If receipt or even tender of notice is indispensable for giving the notice in the context envisaged in clause (b) an evader would successfully keep the postal article at bay at least till the period of fifteen days expires. Law shall not help the wrongdoer to take advantage of his tactics. Hence the realistic interpretation for the expression ‘giving notice’ in the present context is that, if the payee has dispatched notice in the correct address of the drawer reasonably ahead of the expiry of fifteen days, it can be regarded that he made the demand by giving notice within the statutory period. Any other interpretation is likely to frustrate the purpose for providing such a notice.” 45. In yet another judgment of the Hon’ble Apex Court in the case of N. Parameswaran Unni v. G. Kannan, reported in (2017) 5 SCC 737, it has held as under: 11. A bare reading of Section 138 of the NI Act indicates that the purport of Section 138 is to prevent and punish the dishonest drawers of cheques who evade and avoid their liability. As explained in clause (b) of the proviso, the payee or the holder of the cheque in due course is necessarily required to serve a written notice on the drawer of the cheque within fifteen days from the date of intimation received from the bank about dishonour. 24 12. It is explicitly made clear under clause (c) of Section 138 of the NI Act, that this gives an opportunity to a drawer of the cheque to make payment within fifteen days of receipt of such notice sent by the drawee. It is manifest that the object of providing clause (c) is to avoid unnecessary hardship. Even if the drawer has failed to make payment within fifteen days of receipt of such notice as provided under clause (c), the drawer shall be deemed to have committed an offence under the Act and thereafter the drawee would be competent to file complaint against the drawer by following the procedure prescribed under Section 142 of the Act. 13. It is clear from Section 27 of the General Clauses Act, 1897 and Section 114 of the Evidence Act, 1872, that once notice is sent by registered post by correctly addressing to the drawer of the cheque, the service of notice is deemed to have been effected. Then requirements under proviso (b) of Section 138 stand complied, if notice is sent in the prescribed manner. However, the drawer is at liberty to rebut this presumption. 46. In the case of Central Bank of India v. Saxons Farms, reported in (1999) 8 SCC 221, the Hon’ble Apex Court has held as under: 8. The object of notice is to give a chance to the drawer of the cheque to rectify his omission and also to protect an honest drawer. Service of notice of demand in clause (b) of the proviso to Section 138 is a condition precedent for filing a complaint under 25 Section 138 of the Act. In the present appeals there is no dispute that notices were in writing and these were sent within fifteen days of receipt of information by the appellant Bank regarding return of cheques as unpaid. Therefore, the only question to be examined is whether in the notice there was a demand for payment. 47. On careful perusal of the above principles of law it is crystal clear that when once the notice is issued to the accused at his last known address through RPAD, it should be presumed that notice is duly issued and served under Section 27 of the General Clauses Act, as he has no hand in service of the notice or otherwise. 48. In the case on hand, since the notice is returned with an endorsement ‘not claimed’, the contentions urged on behalf of the revision petitioner that there is no proper service of notice cannot be countenanced in law. Answers obtained in cross- examination with regard to service of notice through courier service thus becomes insignificant. 26 49. As such, this Court does not find any legal infirmity or perversity in the order of conviction recorded by the learned Trial Judge, confirmed by the First Appellate Court so as to interfere in the limited revisional jurisdiction. 50. Thereore, the conviction order is to be maintained. Accordingly, point No.1 is answered in the negative. 51. Regarding Point No.2: Having held thus, it is seen that the learned Trial Magistrate and learned Judge in the First Appellate Court have imposed sum of Rs.10,000/- each in both cases towards defraying expenses of the State. Same cannot be countenanced in law as lis is privy to the parties and no State machinery is involved. To that extent matter requires interference. Hence, point No.2 is answered partly in the affirmative. 27 52. Regarding point No.3: In view of findings on point Nos.1 and 2, following order is passed: ORDER (i) Criminal revision petition No.1021/2021 and Criminal revision petition No.1058/2021 are allowed in part. (ii) While maintaining the conviction of the accused for the offence punishable under Section 138 of Negotiable Instruments Act, fine amount of Rs.10,000/- each in both C.C.No.188/2019 and C.C.No.187/2019, imposed by the learned Trial Magistrate, confirmed by the First Appellate Court towards defraying expenses of the State is hereby set aside. (iii) Rest of the Sentence in both criminal revision petitions stand unaltered. However, time is granted to pay the balance compensation 28 amount till 31.01.2025, failing which the accused shall undergo simple imprisonment as ordered by the learned Trial Magistrate, confirmed by the First Appellate Court. (iv) Office is directed to return the Trial Court Records with copy of this order forthwith. (V. SRISHANANDA) JUDGE Sd/- MR