The court upheld the presumption under Section 139 of the N.I. Act, requiring accused to demonstrate absence of a legally enforceable debt to contest cheque dishonor charges.

JUDGMENT :

C.M. POONACHA, J.

1. The present appeal is filed under Section 378 (4) of the Code of Criminal Procedure, 1973, [Hereinafter referred to as the ‘ Cr.P.C.’], by the appellant/complainant challenging the order dated 27.11.2017 passed in C.C.No.2370/2012 by the Additional Civil Judge and JMFC, Hosapete, [Hereinafter referred to as the ‘Trial Court’], whereunder, in the complaint filed under Section 200 of the Cr.P.C. the accused Nos.1 and 2 were acquitted of the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 , [Hereinafter referred to as the ‘N.I. Act’]

2. The relevant facts in a nutshell are that the complainant, who is the proprietor of M.K.Minerals, Hosapete, was engaged in mining business at Hosapete and had business dealings with the accused No.1, a sponge iron manufacturing company. The accused No.2 is the director of accused No.1/Company.

3. The accused No.1 had been purchasing iron ore and allied products from the complainant since 2008 and used to make payments towards the purchase amounts periodically. Between 15.12.2008 and 31.08.2009, the complainant supplied various goods to the accused under multiple invoices, as per its requirements, and the accused also made periodical payments with respect to the supplies made. However, from 30.07.2009 onwards, the accused defaulted in making payments and an amount of Rs. 1,56,87,624/- remained outstanding. Despite repeated demands and persuasions by the complainant, the accused failed to clear the dues. In July-2011, the accused No.2, being the Director of accused No.1/Company, issued two cheques bearing Nos.633186 and 633187 dated 31.08.2011 and 30.09.2011 respectively, for a sum of Rs. 50,00,000/- each, which were drawn on IDBI Bank, Bangalore, branch, towards part payment of the outstanding dues. That the accused also agreed to pay the balance amount due. However, the said cheques were dishonored on presentation, and were returned on 15.02.2012 with the endorsement “insufficient funds”. Thereafter, the complainant got issued a legal notice dated 03.03.2012, calling upon the accused to pay the cheque amounts along with the remaining outstanding balance. That the said notice was duly served on the accused on 07.03.2012, but they neither replied to the notice nor made any payment. Hence, the complaint was filed.

4. The accused entered appearance before the Trial Court and contested the proceedings. The Trial Court, vide judgment dated 27.11.2017, acquitted the accused. Being aggrieved, the present appeal is filed.

5. The learned counsel Sri.R.H. Angadi appearing along with the learned counsel Sri.Pranav Badagi for the appellant contends that issuance of cheques having been admitted by the accused, the Trial Court erred in acquitting the accused. That the accused having not replied to the legal notice, and also not having adduced any evidence, and merely having cross- examined the complainant, has failed to rebut the presumption contained under Section 139 of the N.I. Act. Hence, the learned counsels seeks for allowing of the above appeal.

6. Per contra, the learned counsel Sri.Shivaraj Hiremath, appearing for the respondents/accused, justifies the order passed by the Trial Court and contends that the Trial Court did not have the jurisdiction to entertain the complaint, as the accused has its registered office at Bellary. Hence, it is argued that the complaint before the Trial Court is not maintainable. It is further contended that the accused did not receive the legal notice issued by the complainant intimating the dishonor of cheque. It is also contended that both the cheques not having been marked as exhibits, the same ought not to be relied upon. It is further contended that the Trial Court has rightly noticed that as on the date of issuance of cheque, the amount of Rs. 1,56,87,624/- as claimed by the complainant, was not due to the accused. Hence, he seeks for dismissal of the above appeal.

7. The submissions of both the learned counsels have