The court established that a cheque issued under a condition of non-compliance does not create a legally recoverable debt, allowing for the presumption to be rebutted.

CAV ORDER

1. This revision petition under Sections 397 read with 401 of Cr.PC is filed by the accused with a prayer to set aside the judgment and order of conviction and sentence dated 03.04.2014 passed by the Court of XXII Addl. Chief Metropolitan Magistrate, Bengaluru City, in CC.No.14587/2004 and the judgment and order dated 02.08.2017 passed by the Court of LXIX Addl. City Civil & Sessions Judge, Bengaluru, in Crl.A.No.446/2014.

2. Heard the learned Counsel for the parties.

3. The respondent herein had filed a private complaint under Section 200 of Cr.PC against the petitioner herein before the jurisdictional Court of Magistrate alleging that the cheque in question bearing No.817355 dated 16.04.2004 drawn on ING Vysya Bank, Hospet Branch, for a sum of Rs.45 lakhs which was issued in favour of the complainant by the petitioner towards repayment of the amount of Rs.45 lakhs received by him from the complainant was dishonoured by the drawee bank for the reason that payment was stopped by the drawer. According to the complainant, petitioner who is the Proprietor of the firm known as M/s. Sreenidhi Trading Company had undertaken to supply 50 MTs of iron ore to the complainant who is the Proprietrix of firm known as M/s. Sumith Impex at the rate of Rs.235/- per metric tonne and had totally received a sum of Rs.45 lakhs from the respondent, but had failed to supply the iron ore and towards repayment of the amount received, had issued the cheque in question for a sum of Rs.45 lakhs. After the said cheque was dishonoured by the drawee bank, a statutory notice was got issued on behalf of the complainant to the petitioners herein and since the petitioner had not repaid the amount covered under the cheque in question inspite of service of legal notice, the respondent had initiated proceedings against the petitioner for the offence punishable under Section 138 of N.I.Act in CC.No.14587/2004 before the jurisdictional Court of Magistrate.

4. In the said proceedings, petitioner after receipt of summons from the Trial Court, had appeared before the court and claimed to be tried. To prove her case, the respondent had examined herself as PW-1 before the Trial Court and got marked 26 documents as Exs.P-1 to P-26. On behalf of the defence, no oral evidence was led, but six documents were got marked as Exs.D-1 to D-6.

5. The Trial Court after hearing the arguments addressed on both sides and on appreciating the oral and documentary evidence placed on record, convicted the petitioner for the offence punishable under Section 138 of the N.I.Act, and sentenced him to pay a fine of Rs.45,05,000/-, and in default to undergo simple imprisonment for a period of one year. The said judgment and order of conviction and sentence passed by the Trial Court in CC.No.14587/2004 was confirmed in Crl.A.No.446/2014. It is under these circumstances, the accused is before this Court.

6. Learned Counsel for the petitioner submits that the cheque in question has been issued by the petitioner under letter Ex.D-3 which would go to show that the said cheque was issued with a condition that respondent shall ensure and supply iron ore fines Fe % 63.5+. Undisputedly, the respondent has not complied the said condition, and therefore, it cannot be said that the cheque was issued towards legally recoverable debt. The courts below have failed to appreciate the aforesaid aspect of the matter. Though the respondent is the Proprietrix of M/s. Sumith Impex, one Mr. Varuthi B.U.Shankar was the person who was looking after the day today affairs of the said firm. He has not been examined in the