CC. No.

671 of 2019

IN THE COURT OF XXVII METROPOLITAN MAGISTRATE,

(FAST TRACK COURT FOR TRIAL OF CASES UNDER SECTION 138 NEGOTIABLE
INSTRUMENTS ACT), SAIDAPET, CHENNAI – 15
PRESENT: N.VASUDEVAN, B.A., B.L.,
XXVII METROPOLITAN MAGISTRATE (FAST TRACK COURT)

Thursday, this the 19th Day of September 2024

CC. No.671 of 2019
(CNR.No.TNCH0C-001782-2019)

JUDGMENT UNDER SECTION 355 of Cr.P.C

A Serial Number of the Case CC.No.671/2019

B Date of Offence 15.12.2018
C Name of the Complainant & M/s. Sri Balaha Chemicals Pvt. Ltd., Rep.by its
Address Administrative officer/Authorised Signatory, Mr.
Harsha J.S. Assistant Manager, Padma Edifice,
New No.2, Old No.9, Annai Nagammai Street,
Raja Annamalaipuram, Chennai- 600 028.
D Name of Accused A1. Nandaki Industries, Rep. By Partner D.
Pruthvidhar 57/1. Yellupura Village,
Doddaballapur Taluk, Bangalore Rural District –
561 203.
A2. Mr. D. Pruthvidhar, Partner-Nandaki
Industries, 57/1. Yellupura Village, Doddaballapur
Taluk, Bangalore Rural District – 561 203.
A3. Mr. R. Damondaran, Partner-Nandaki
Industries, No.118, 4th J Cross, East of NGEF,
Bagalore- 560 043.
E Offence Complained of Dishonor of Cheque- u/s.138 of the Negotiable
Instruments Act.
F Plea of the Accused and his Pleaded not Guilty.
Examination in Brief
G Final Order In result,the complaint is dismissed. The accused is
found not guilty under section 255(1)Cr.P.C for the
offence under section 138 Negotiable Instruments
Act and the accused is acquited and ordered to be
set at liberty. His bailbonds are ordered to be
cancelled after the expiry of the appeal period
H Judgment Reserved on 27.08.2024
I Judgment Pronounced on 19.09.2024
 CC. No.671 of 2019

PART-B – A brief statement of reasons for the decision

(As mandated u/s.355(1) of the code of criminal procedure,1973)

This case come up for final hearing before me on 04.09.2024 in the presence of Mr. K.K.

Murralitharan, R. Hemavathi Counsels for the complainant and Mr. R. Karthikeyan Counsels for the

accused and the case having stood over for consideration till this day and upon hearing the

arguments advanced by the either sides and upon considering the materials on record, this court

delivered the following:

JUDGMENT

1. By this Judgment, this Court shall decide upon the complaint filed by M/s. Sri Balaha

Chemicals Pvt. Ltd., Rep.by its Administrative officer/Authorised Signatory, Mr. Harsha

(hereinafter referred to as the ‘Complainant’) under Section 138 of Negotiable Instruments Act,

(hereinafter referred to as the ‘the NI Act’) against 1. Nandaki Industries Rep. D. Pruthvidhar, 2.

Mr. D. Pruthvidhar and 3. Mr. R. Damodaran (hereinafter referred to as the Accused1 to 3

respectively)

2. The crux of the Complaint would run thus:

(a) That the complainant is doing manufacture and supply of raw materials used in chemical

industries. In the usual course of business, the accused 2 and 3 as partners of the partnership firm

namely Nandaki Industries/ 1st Accused approached the complainant for supply of Polyol 8010 and

TDI for their site and placed orders to the complainant and accordingly the complainant effected

supply of such materials from their factory to the accused from April 2017 to April 2018. Along

with supplies, the complainant raised their respective invoices on the accused. In this regard, there

has been a running account maintained between the parties. It was contended by the complainant

that form the inception, the accused had been irregular in effecting payment for the supply of

materials received by them from the complainant, except making some sporadic payments.
 CC. No.671 of 2019

Therefore, on 08.05.2018 the complainant addressed an e-mail to the accused setting out the details

of their supply and amounts due from the accused as on that date, ie Rs.20,84,104/- and it was also

explained that further credit period cannot be given, since the complainant has to make advance

payments to the end supplier and requested the accused to make remittance of at least of Rs.15

lakhs and the accused have not even chosen to reply thereon.

(b) That subsequently, the accused 2 & 3 jointly as authorized signatories of the 1 st

accused/Nandaki Industries signed & issued two cheque nos.650730 & 650731 dated 15.08.2018 &

25.08.2018 drawn on Vijaya Bank, Kasturinagar Branch, Karnataka for an amount of Rs.7 lakhs

and Rs.7,04,104/- respectively favouring the complainant in partial discharge of their liability

towards materials received by them from the complainant with request to present such cheques after

15 days for clearance. Since, there was no instruction from the accused thereafter, the complainant

addressed another mail dated 18.09.2018 but the accused failed to respond.

(c) Hence, the complainant presented the aforesaid 2 cheques to it's banker, namely HDFC

bank, RK Salai branch, Chennai 600 004 on 09.11.2018 and 14.11.2018. but the same was returned

along with memos from their bank, intimating that the said two cheques issued by the accused got

dishonoured reason “Funds insufficient” in the account of the accused. Immediately, on 15.11.2018,

the complainant addressed the accused informing dishonour of the said two cheques issued by the

accused and asked for immediate settlement of amounts covered therein. In spite of receipt of such

mail from the complainant, the accused have chosen not even to respondent thereto.

(d) That the accused Nos.2 & 3 as authorized signatories of the 1 st accused had issued those

two cheques to the complainant in discharge of their partial liability to the complainant on supply of

materials received and appropriated to commercial use by the accused’s partnership firm. The

accused Nos.2 & 3 have deliberately issued those two cheques without keeping required funds in

their bank account and with clear knowledge that on presentation of such cheques, it will be
 CC. No.671 of 2019

dishonoured. The action of the accused Nos.2 & 3 will amount to an offence punishable under

Sections 138 to 142 of the Negotiable Instrument Act. Therefore, on 30.11.2018, the complainant

caused to issue a statutory notice to the accused calling upon them to pay the amounts covered

under the aforesaid two cheques Rs.7,00,000/- + Rs.7,04,104/- = Rs.14,04,104/- to the complainant

within 15 days of receipt of the notice, failing which it was cautioned that criminal action will be

initiated against the accused for recovery of such amounts with compensation before court of law.

The accused received the notice but neither did they comply the same nor issued any reply. Hence,

the present complaint.

3. After recording the sworn statement of the complainant and on perusal of the documents,

having found a prima facie case against the accused, this court took cognizance of the offence under

section 138 of N.I Act and issued summon to the accused. Upon appearance of the accused on

summon, copy of the complaint was served on the accused and the substances of accusations were

explained to the accused and he was questioned for which the accused pleaded not guilty and sought

trial. Since this court found sufficient materials on record to proceed against the accused, this court

ordered trial.

4. Thereupon, in order to prove the case of the complainant, the original complainant

Vijayabaskar was examined as P.W.1 by way of proof affidavit. However since he left the services

of the complainant, his chief affidavit was eschewed and the present complainant Harsha was

substituted in his place and filed fresh proof affidavit as PW1 and through him Ex.P1 to P11

marked. In his Proof Affidavit, PW1 has reiterated the complaint averments. With the above said

evidence, complainant side evidence was closed.

5. Thereafter, statement of the accused u/s.313(1)b of Cr.P.C was recorded after disclosing

the incriminating circumstances against the accused in the evidence, to which the accused had

denied the evidence as false and also filed a written response and also stated that he has defence
 CC. No.671 of 2019

side evidence. The 2nd accused was examined as DW1 and no documentary evidence was marked on

the side of the accused. Thereafter, the defence side evidence was closed.

6. Heard both side arguments. Written arguments also filed by both sides.

7. Now the point for determination before this court is whether the complainant had

established a case against the accused under section 138 of the N.I.Act beyond all reasonable doubts

or not?

8. In order to ascertain whether the accused has committed the offence under section 138 of

the N.I Act, it is deemed fit to examine as to whether all the indispensable ingredients constituting

the offence have been proved by the complainant or not. The offence under section 138 of the N.I

Act has the following ingredients:

➢ Dishonour of cheque in question which must have been drawn on an account

maintained by the accused;

➢ The cheque should have been issued for discharge, in whole or in part, of any debt

or other liability;

➢ That cheque has been presented to the bank within a period of three months from

the date of which it is drawn or within the period of its validity whichever is earlier;

➢ That cheque is returned by the bank unpaid, either because of the amount of money

standing to the credit of the account is insufficient to honour the cheque or that it

exceeds the amount arranged to be paid from that account by an agreement made

with the bank;

➢ The payee or the holder in due course of the cheque makes a demand for the

payment of the said amount of money by giving a notice in writing, to the drawer
 CC. No.671 of 2019

of the cheque, within 30 days of the receipt of information by him from the bank

regarding the return of the cheque as unpaid;

➢ The drawer of such cheque fails to make payment of the said amount of money to

the payee or the holder in due course of the cheque within 15 days of the receipt of

the said notice.

➢ Filing of complaint within one month from the date on which cause of action arises.

If the above mentioned ingredients are satisfied, then the person who had drawn the cheque

can be deemed to have committed an offence under Section 138 of the Act.

9. Now it is to be seen whether the above essential ingredients are proved by the

complainant or not. The following facts are admitted:

(i) Ex.P2 is the cheques(2 nos) in question.

(ii) That the cheques were drawn on accused bank account.

(iii) The accused, who is the signatory in the cheques has not denied his signature found

in the cheques in question (i.e) Ex.P2.

(iv) Presentation of the cheques in question for encashment within 3 months from the

date of its issue and dishonour of the cheques for the reason "INSUFFICIENT FUNDS" as it could

be verified from the records(i.e) return memo dated 14.11.2018, which was marked as Ex.P3.

(v) Issuance of the legal notice dated 30.11.2018 by the complainant to the accused

(marked as Ex.P4) informing the fact of dishonour of cheque and demanding repayment .

(vi) That the accused to received the legal notice (as evidenced by the acknowledgment

card and postal track report Ex. P5) but did not pay the cheque amount.

(vii) That the complaint has been filed within limitation period.
 CC. No.671 of 2019

10. At this juncture, this court is obliged to refer the decision of Hon’ble Supreme Court of

India between K.N. Beena Vs. Muniyappan and another, reported in [2002 SCC (CRI) 14], wherein

it is held as follows:

“Under Section 118 unless the contrary was proved, it is to be presumed that the

Negotiable Instrument (including a cheque) had been made or drawn for

consideration. Under Section 139 the Court has to presume, unless the contrary was

proved, that the holder of the cheque received the cheque for discharge, in whole or in

part, of a debt or liability. Thus, in a complaint under Section 138 NI Act, the Court

has to presume that the cheque had been issued for a debt or liability. This

presumption is rebuttable. However, the burden of proving that a cheque had not been

issued for a debt or liability is on the accused”. This court in the case of Hiten P.

Dalal (Vs) Bratindranath Banerjee, reported in [(2001) 6 SCC 16] has also taken an

identical view.

The learned counsel for the complainant also placed reliance upon the case of T.Vasanthakumar Vs

Vijayakumari reported in 2015 (8) SCC 378 wherein it was held as follows :

“Where issuance of cheque after signing there on, if accepted by the accused, the

presumption under section 139 would operate and there of the burden is on the

accused to disprove the cheque or the existence of any liability”

The learned counsel for the complainant also relied upon the case of sumeti vij Vs Paramount Tech

Fab Industry, reported in MANU /SC/0167/2021 wherein the Hon’ble Supreme Court has held as

follows:

“there is mandatory presumption of consideration in terms of provisions of the act

and as per principle of “reverse onus”, the accused shall rebut the presumption

that the cheque was issued not for discharge of any debt or liability. ”
 CC. No.671 of 2019

The above citations squarely apply to the facts on hand. Consequently, the complainant

would be entitled to the statutory presumption available under the law that the impugned cheue has

been issued for discharging a legally enforcible debt or other liability. However, such presumption

being rebuttable, it has to be examined whether the accused has discharged such burden or not.

11. In the instant case, the accused has taken the following defences:

a) That the cheques marked as Ex.P2 were not issued towards discharging any legally

enforceable debt or liability

b) That the cheques marked as Ex.P2 were issued as a measure of security towards the

business deal between the complainant and the respondents that the complainant has misused the

same and presented the same for collection without proper instruction from the accused.

12. While considering whether the accused has probablised his defence and shifted the onus
of proof on the complainant, the following points arise for consideration:

i) In the instant case, the defence put forward by the accused is that he had discharged the

entire dues under the invoices raised by the complainant until March 2018 and that the complainant

has misused the cheques issued as a measure of security towards the business deal with the

complainant. Though, the 2nd accused had entered the witness box and gave oral evidence in

support of his case, no documentary evidence such as the account books of the accused has been

placed on record by the accused to show that there is no amount liable to be paid by the accused to

the complainant.

In Kumar Exports Vs Sharma Carpets reported in (2009) 1 MLJ (Crl) 753 (SC) it is held,

"The accused in a trial under section 138 of the Act has two options. He

can either show that consideration and debt did not exist or that under the

particular circumstances of the case the non-existence of consideration and debt

is so probable that a prudent man ought to suppose that no consideration and

 CC. No.671 of 2019

debt existed. To rebut the statutory presumptions an accused is not expected to

prove his defence beyond reasonable doubt as is expected of the complainant in

a criminal trial. The accused may adduce direct evidence to prove that the note

in question was not supported or liability to be discharged by him. However, the

Court need not insist in every case that the accused should disprove the non-

existence of consideration and debt by leading direct evidence because the

existence of negative evidence is neither possible nor contemplated. At the same

time, it is clear that bare denial of the passing of the consideration and existence

of debt, apparently would not serve the purpose of the accused. Something which

is probable has to be brought on record for getting the burden of proof shifted to

the complainant. To disprove the presumptions, the accused should bring on

record such facts and circumstances, upon consideration of which the Court may

either believe that the consideration and debt did not exist or their non-exist.

Apart from adducing direct evidence to prove that the note in question was not

supported by consideration or that he had not incurred any debt or liability, the

accused may also rely upon circumstantial evidence and if the circumstances so

relied upon are compelling, the burden may likewise shift again on to the

complainant . The accused may also rely presumptions of fact, for instance, those

mentioned in Section 114 of the Evidence Act to rebut the presumptions arising

under section 118 and 139 of the Act. The accused has also an option to prove

the non-existence of consideration and debt or liability either by letting in

evidence or in some clear and exceptional cases, from the case set out by the

complainant, that is, the averments in the complaint during the trial. Once such

rebuttal evidence is adduced by the complainant during is adduced and accepted

by the Court, having regard to all the circumstances of the case and the

preponderance of probabilities the evidential burden shifts back to the

 CC. No.671 of 2019

complainant and thereafter, the presumptions under Sections 118 and 139 of the

Act will not again come to the complainant’s rescue.”

Thus, in view of the above mentioned citation while considering whether the accused is

able to make out a probable defence in his favour from the evidence produced by the complainant,

the following facts emerge:

ii) The complainant had claimed that the amount due under the invoices marked as Ex.P7

series remained to be paid and towards partial discharge of the said amount Ex.P2 cheques were

issued by the accused. A perusal of Ex.P7 reveal that the complainant had raised the following

Invoices:

S.No Invoice No. Date Amount (Rs.)

1. CHN6807 13.03.2018 4,86,750/-
2. CHC0190 06.04.2018 6,49,286/-
3. CHC0191 06.04.2018 9,71,500/-

The accused had claimed that the entire dues untill March 2018 were settled to the

complainant and nothing remained to be paid till then. With respect to the transactions between the

complainant and the accused the complainant has produced thge ledger account of the accused as

Ex.P10. In this context it would also be useful to extract the ledger account produced by the

complainant pertaining to the account maintained with it by the accused and marked as Ex.P10.

1-Apr-17 to 31-Mar-2018

Date Particulars Vch type Vch No. Debit Credit

13-Mar-18 Cr GST Sales GST Sales CHN6807 4,86,750.00
Closing 4,86,750.00
balance
4,86,750.00 4,86,750.00
 CC. No.671 of 2019

1-Apr-18 to 31-Mar-2019

Date Particulars Vch type Vch No. Debit Credit

1-Apr-18 Cr Opening Balance 4,86,750.00
6-Apr-18 Cr GST Sales GST Sales CHC0190 6,49,236.00
Cr GST Sales GST Sales CHC0191 9,73,500.00
4-May-18 Dr HDFC BANK A/C 0040120000171 Receipt 1324 2,50,000.00
1-Jun-18 Dr HDFC BANK A/C 0040120000171 Receipt 2495 2,00,000.00
20-Jun-18 Dr HDFC BANK A/C 0040120000171 Receipt 3315 4,80,000.00
10-Oct-18 Dr HDFC BANK A/C 0040120000171 Receipt 8410 7,04,104.00
11-Oct-18 Cr HDFC BANK A/C 0040120000171 Payment 8624 7,04,104.00
17-Oct-18 Dr HDFC BANK A/C 0040120000171 Receipt 8700 7,00,000.00
18-Oct-18 Cr HDFC BANK A/C 0040120000171 Payment 8940 7,00,000.00
8-Nov-18 Dr HDFC BANK A/C 0040120000171 Receipt 9687 7,04,104.00
9-Nov-18 Cr HDFC BANK A/C 0040120000171 Payment 9989 7,04,104.00
13-Nov-18 Dr HDFC BANK A/C 0040120000171 Receipt 9856 7,00,000.00
14-Nov-18 Cr HDFC BANK A/C 0040120000171 Payment 10202 7,00,000.00
25-Mar-19 Dr HDFC BANK A/C 0040120000171 Receipt 15846 50,000.00
49,17,694.00 37,88,208.00
Dr Closing Balance 11,29,486.00
49,17,694.00 49,17,694.00

1-Apr-19 to 31-Mar-2020

Date Particulars Vch type Vch No. Debit Credit

1-Apr-19 Cr Opening Balance 11,29,486.00
6-May-19 Dr (as per details) Receipt 1328 25,382.00
SRI BALAHA CHEMICALS PVT
LTD-BLR HDFC BANK A/C
0040120000171
RECD FROM NANDAKI
INDUSTRIES
11,29,486.00 25,382.00
Dr Closing Balance 11,04,104.00
11,29,486.00 11,29,486.00

The above mentioned documents namely Ex.P7 and Ex.P10 along with Ex.P8, Ex.P9 and

Ex.P11were disputed by the accused stating that they have been produced belatedly and that they

have been created for the purpose of the case. Apparently, the invoices marked as Ex.P7 were not
 CC. No.671 of 2019

properly vouched nor any voucher or delivery receipt signed by the accused for receipt the goods

under the said invoices has been filed.

iii) Further, the entries in the ledger account for the period 1-Apr-2019 to 31-Mar-2020

marked in Ex.P10 reveals that only a sum of Rs.11,04,104/- remains in credit. Further, the ledger

account for the period 1-Apr-2017 to 31-Mar-2018 in Ex.P10 shows only one entry which is

corresponding to the sales voucher dated 13-Mar-18 for Rs.4,86,750/-. Admittedly, the parties have

been doing business from the year 2016. In such circumstances the ledger account for the period 1-

Apr-2017 to 31-Mar-2018 in Ex.P10 showing only one entry raises reasonable doubt in the

genuineness of the ledger accounts marked as Ex.P10 and that there is possibility of the document

being doctored. Though admittedly, the accounts up and until March 2018 have been settled

between the parties, the ledger accounts for a particular period ought to have revealed the entire

transactions for that period particularly when the complainant has claimed that the business

continued the after but it is not so in the above case. Hence, this court does not accept Ex.P7 as it

contains only partial details.

iv) Further, a perusal of the cross examination of Pw1 reveals that he has admitted that the

entire dues prior to March 2018 between the parties have been settled. Pw1 has also deposed that

towards chemical supplied vide invoices from March 2018- March 2019 a sum of Rs. 21 Lakhs and

odd remained to be paid out of which the accused repaid Rs. 10 Lakhs and agreed to repay Rs.12

Lakhs towards the balance of Rs.11 Lakhs and odd together with interest and also executed a

document in respect of the same .Pw1 has specifically asserted during cross examination that the

accused has to pay only a sum of Rs.12 Lakhs at present. His evidence in this regard is as follows :

" இவ்வழக்கு தததொடர்புடடய பரிவர்த்தடனைகள் மதொர்ச் 2018 முதல் மதொர்ச்

2019 வடரையதொனை கதொலத்திற்குரியத. மதொர்ச் 2018 முன்பு வடரையதொனை

அடனைத்த பணப்பரிவர்த்தடனைகளும் நநேர் தசெய்யப்பட்டுவிட்டனை.

 CC. No.671 of 2019

எதிரிக்கு நேதொங்கள் தகமிக்கல் செப்டளை தசெய்த வடகயில்

இன்வதொய்ஸ்களின் படி மதொர்ச் 2018 முதல் மதொர்ச் 2019 வடரை ருபதொய் 21

இலட்செம் மற்றும் தசெதொச்செம் பதொக்கி இருந்தத. அதில் எதிரி ருபதொய் 21

இலட்செம் திருப்பி தந்ததொர். மீத தததொடக ரு.11 இலட்செத்த தசெதொச்செத்டத

வட்டியுடன் நசெர்த்த ரு. 12 இலட்செமதொக திருப்பி தருவததொக ஒப்பு

தகதொண்டு எதிரி எங்கள் நிறுவனைத்திற்கு ஆவணம் ஒன்டறையும்

ஏற்படுததிக் தகதொடுத்தள்ளைதொர். எதிரி தற்நபதொத எங்கள் நிறுவனைத்திற்கு

தரைநவண்டிய பதொக்கி ரு.12 இலட்செம் மட்டும் ததொன். "

Though Pw1 has asserted during his cross examination that the accused had executed a

document in favour of the complainant admitting his liability to pay Rs.12,00,000/- to the

complainant, no such document allegedly executed by the accused in favour of the complainant has

been filed by the complainant. Further it was contended by the complainant that the accused agreed

to pay interest for the sum of Rs.11 Lakhs and odd allegedly payable by him to the complainant,

there is neither pleading nor evidence to show the date from which the interest is payable or the rate

of interest allegedly agreed to be paid or the date till which such interest was calculated. In any

event when the complainant himself has admitted that on the date of issuance of the cheques

marked as Ex.P2, the amount payable was calculated at Rs.12 Lakhs, there is no question of

issuance of cheques for Rs. 7,04,104/- and Rs.7,00,000/- respectively totally for Rs.14,04,104/-. The

complainant has miserably failed to explain the above aspect and it raises a bonafide dount in the

genuineness of the complainant's case and probabilises the defence version that the cheques issued

as security were misused.

v) It is the case of the accused that as per usual business practice the complainant received

blank cheques and other documents from the accused as a measure of security while they were
 CC. No.671 of 2019

doing business. That the accused returned the materials supplied by the complainant as the

matrerials were found to be not in compliace with the expected quality. Subsequent to March 2018

the accused did not have any business transaction with the complainant and therefore severed his

business transactions with the complainant and therefore the complainant has misused the cheques

handedover to the complainant as measure of security and filed the present case. When the above

facts was put to Pw1 during the course of his cross examination, he had denied the same and

claimed that the accused admitted his liablities by way of e-mail and issued the cheques marked as a

Ex.P2. But, no documentary proof to show such communication from the accused to the

complainant was produced on the side of the complainant . Further, on the side of the complainant,

Ex. P8 and Ex.P9 were filed to show alleged E-mail communications between the complainant and

accused. Ex.P8 is stated to be the E-mail sent by one Ajith to the 3 rd accused by marking copies to

the 1st accused, one Ramesh and Abishek. No explanation has been offered on the side of the

complainant as to who is the said Ajith or how he is related to the complainant. Further, Ex.P8 has

not been produced through it’s maker namely Ajith neither he was examined as a witness nor any

reason offered for his non examination.

vi) Ex.P9 is an alleged E-mail reply issued by the 3 rd accused to the E-mail dated

14.03.2019 sent by the said Ajith wherein the said Ajith has contended that in continuation of

discussion with the 3rd accused and his partner Dr.Ramesh Savanur regarding settlement of very old

outstandings. It is not made clear as to whether the said E-mail sent by Ajith is in respect of the

transaction with 1st accused namely Nandaki Industries. Apparently, one Dr.Ramesh Savanur was

stated to be the partner of the 3rd accused in the above said E-mail whereas the said Dr.Ramesh

Savanur is not a partner to the 1st accused firm even as per the complaint no he as arranged as an

accused in the instant case. Further, a perusal of Ex.P9 reveals that the said reply E-mail purportedly

sent by the 3rd accused has been sent by one Madhu D.P. from the email ID of the 3rd accused. It was

not explained as to who is the said Madhu D.P. Page 2 of Ex,P10 namely the E-mail dated
 CC. No.671 of 2019

22.02.2019 allegedly sent by the said Ajith to the 3rd accused is also in respect of his discussion with

the 3rd accused and his partner Dr.Ramesh Savanur. Page No.3 of Ex.P9 is a purported E-mail

attachment dated 15.03.2019 sent by the 3rd accused to the complainant wherein he admitted liablity

to the tune of Rs.12,04,104/-. However, the original of the said letter has not been placed on record

and no explanation has been offered for the non production of the original. The alleged attachment

letter has been issued more than 7 months after the alleged issuance of cheques marked as Ex.P2.

Apparently, the signature of the 3rd accused as found in Ex.P2 series does not match with the

signature found in the above said letter dated 15.03.2019 sent through E-mail attachment and

marked in Ex.P9. Therefore, both Ex.P8 and Ex.P9 will not be helpful in any manner to establish

the case of the complainant.

vii) Though, complainant in his complaint has mentioned about an E-mail dated 08.05.2018

addressed to the accused wherein the complainant claimed to have given the details a supply and

amounts due from the accused to the tune of Rs. 20,84,104/- and requested the accused to remit

atleast Rs.15,00,000/-, the said E-mail has not been produced during evidence and no reason for non

production of the same has been stated by the complainant. The said E-mail dated 08.05.2018

mentioned in the complaint which is closer in point of time to the transaction between the parties

would have thrown more light on the transaction between the complainant and the accused. The

non production of the same also raises a reasonable doubts in the bonafides of the complainant's

claim.

The Hon'ble High Court of Madras, in the case of Thiraviyam V/s Thangamariyappan

reported in (2017) 3 MLJ (Crl.) 325 has held as follows:

“Trial court while passing the impugned judgment of acquittal at paragraph had

interalia observed that there is no evidence on the part of the complainant in show the

existing liability as on date of issuance of cheque and further at Paragraph had proceeded
 CC. No.671 of 2019

to observe that defence has raised a probable defence that the cheque was given under

duress and finally came to the consequent conclusion that the evidence were insufficient and

that the evidence were sufficient to disprove the case of complainant and consequently

found the accused not guilty in respect of an offence and acquitted him.”

"Be that as it may it is to be pointed out that the burden is on the complainant in

respect of an offence under section 138 of Negotiable Instruments Act to establish his case

against the Respondent/ Accused beyond shadow of doubt. But at the same time, it cannot

be slightly ignored that the Respondent/ Accused is entitled to shake or affect the credibility

of the prosecution story by bringing in certain facts/ circumstances which point out about

his probabilities of the case. In Instruments Act is entitled to maintain silent. He need not

enter into the box to dislodge the case of a complainant. It is just enough that if he is able to

make an inroad into the evidence depositions of witness witnesses of the prosecution side."

In the instant case also as discussed supra, the accused has raised doubts in the case of the

complainant which probablise his defence.

viii) Another defence put forward by the accused is that there was no subsistiung debt or

other liability payable by the accused to the complainant on the alleged date of issuance of the

cheques. In this respect, the learned counsel for the accused pointed out to the complainant's

averment in his complaint that A2 and A3 jointly, as authorised signatories of the 1 st accused

Nandaki Industries signed and issued two cheque nos.650730 & 650731 dated 15.08.2018 &

25.08.2018 drawn on Vijaya Bank, Kasturinagar Branch, Karnataka for an amount of Rs.7 lakhs

and Rs.7,04,104/- respectively favouring the complainant in partial discharge of their liability

towards materials received by them from the complainant. He also pointed out to the oral evidence

of Pw1 that after ascertaining the balance a sum of Rs.11 Lakhs and odd remained to be paid and
 CC. No.671 of 2019

the accused agreed to pay Rs.12 Lakhs in all towards principal and interest and issued the cheques

and argued that though the dates mentioned in the cheques marked as Ex.P2 were different, they

have been allegedly issued on the same dates and that on the date of issuance of the cheques marked

as Ex.P2, there is no subsisting debt or other liability payable by the accused to the complainant to

the tune of sum of Rs. 14,04,104/- and the very case of the complainant that the cheques were

issued towards partial discharge of the amount payable by the accused to the complainant itself is

improbable. The above submission of the learned defence counsel also raises doubts in the

prosecution case.

The Hon’ble Supreme Court in P.Venugopal Vs Madan P. Sarathi (2009) 1 SCC 492, has
held as follows

"Sections 139, 118(a) and 138 of Negotiable Instruments Act, 1881- Dishonour of

cheque- Presumption in case of – Held, presumptions must be confined to matters

specified in Sections 139 and 118(a) – Other facts have to be proved by the party

alleging them- Existence of debt or other liability - Held, has to be proved in the

first instance by the complainant- Complainant said to have given hand loan and

appellant in return issuing two cheques in complainant's favour - Courts below

holdings as a fact that granting of loan was proved by Complainant- Burden of

proving to the contrary shifted to appellant - Courts below further holding that

appellant not able to discharge his burden - Held, no case made out for interference

by the Supreme Court".

In view of the above citation, the burden of proof only rests on the complainant to prove the

existence of debt or other liability on the date of issuance of the cheques. In any case, in view of the

accused being able to show lacunae in the case of the complainant, the burden of proof shifts on the

complainant and it is incumbent on the complainant to establish the existence of subsisting debt or
 CC. No.671 of 2019

other liability which the complainant has miserably failed to establish. The complainant has not

produced proper documentary proof to show that the materials were in fact supplied to the accused

as per the invoices and that the accused received the same. When admittedly the accounts were

settled in full between the parties during the middle of the financial year (i.e.) before March 2018, it

is for the party who claims to have supplied the materials that there was a revival in business

relationship between the parties to establish such fact. Apparently, the vouchers marked as Ex.P7

have come in to existence only after settling of accounts between the parties. Therefore, it is the

bounden duty of the complainant to prove resumption of normal business relationship but,

apparently, after the dates mentioned in the vouchers marked as Ex.P7 there has been no supply of

materials even as per the ledger account marked as Ex.P10.The rest of the transactions contained in

Ex.P10 pertain only to payments and receipts through banking transactions. Under such

circumstances, this court concludes that the complainant has miserably failed to discharge his

burden of proof and establish that there was resumption of business relationship between the parties

after March 2018 when the accounts nor admittedly settled and that the complaint infact supplied

materials to the accused under invoices marked as Ex.P7 then by failed to establish existence of a

subsisting debt or liability on the date of alleged issuance of the impugned cheques marked as

Ex.P2.

ix) Considering all the above circumstances this court concludes that the accused has

probabilised his defence by creating a dent in the prosecution case from the evidence of the

complainant and rebutted the presumption of law extended in favour of the complainant and in

consequence shifted the burden of proof on to the complainant. On the other hand, the complainant

had miserably failed to discharge the burden of proof on his shoulders. Consequently, the

complainant’s action fails.

 CC. No.671 of 2019

13. In result, the complaint is dismissed. The accused is found not guilty under section

255(1) Cr.P.C for the offence under section 138 Negotiable Instruments Act and the accused is

acquitted therefor and ordered to be set at liberty. His bail bonds are ordered to be cancelled after

the expiry of the appeal period.

Typed to my dictation directly in the computer, corrected and pronounced by me in the open
court this the 19th day of September, 2024.

//sd//N.Vasudevan, B.A.B.L.,
XXVII Metropolitan Magistrate,
(Fast Track Court) ,
Saidapet, Chennai-15.

Complainant side witness

Pw-1 : Mr. V.S. Vijayabaskar (eschewed)
Pw-1 : Mr. Harsha

Complainant side Documents

Exhibits
Ex.P1 24.12.2018 Board of Resolution
Ex.P2 15.08.2018 & Dishonoured cheques
25.08.2018
Ex.P3 14.11.2018 Return Memos
Ex.P4 30.11.2018 Lawyer’s notice
Ex.P5 11.12.2018 Acknowledgment card and postal track report
Ex.P6 09.06.2023 Board of Resolution
Ex.P7 Invoice
Ex.P8 15.11.2018 Mail from Complainant to accused
Ex.P9 15.03.2019 Mail from Accused to complainant
Ex.P10 1.07.2017 to 31.03.2020 Ledger Account
Ex.P11 06.05.2024 Section 65B Certificate
 CC. No.671 of 2019

Defence Side Witnesses:

DW1 :Prithvidhar

Defence side Documents : Nil

//sd//N.Vasudevan, B.A.B.L.,
XXVII Metropolitan Magistrate,
(Fast Track Court) ,
Saidapet, Chennai-15.

//True copy//