Allowed

Gopalakrishna Chit Funds Pvt. Ltd. v. Manjunatha M H

Karnataka HC10 Dec 2020CRL.A/1166/2017

Case brief

AI extract

What is this about?

High Court of Karnataka allowed Criminal Appeal challenging acquittal. The Court set aside acquittal convicted respondent for cheque dishonour under Sec 138 NI Act and imposed fine and compensation.

What did the court decide?

Acquittal set aside; accused convicted under Section 138 of Negotiable Instruments Act; sentenced to pay fine of Rs.1,75,000/- (Rs.1,60,000/- compensation, Rs.15,000/- to State); simple imprisonment f

Gopalakrishna Chit Funds Pvt. Ltd. Vs… — Contract and Commercial Disputes | Karnataka HC (2020)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 10^TH DAY OF DECEMBER, 2020

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BEFORE

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THE HON’BLE MR. JUSTICE N.K.SUDHINDRARAO

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CRIMINAL APPEAL No.1166/2017

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BETWEEN:

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GOPALAKRISHNA CHIT FUNDS PVT. LTD., NO.5, G.K. ROYALITE, I FLOOR, 50 FEET ROAD, HANUMANTHANAGAR, BANGALORE-560019 REPRESENTED BY ITS MANAGER SRI B.S. MANJUNATH, S/O SHAMBHU, AGED ABOUT 53 YEARS, WORKING AT NO.5, G.K. ROYALITE, I FLOOR, 50 FEET ROAD, HANUMANTHANAGAR, BANGALORE-560019 ..APPELLANT

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(BY SRI B VIJAY SHETTY, ADVOCATE)

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AND:

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MANJUNATHA M H S/O D HUCHHAIAH, AGED ABOUT 41 YEARS, R/AT NO.174, 3RD A MAIN, R.R. LAYOUT, NAGADEVANAHALLI, BANGALURU-560056 ..RESPONDENT

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(BY SRI.M.S.MANJANNA, ADVOCATE)

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THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378(4) CR.P.C PRAYING TO SET ASIDE THE JUDGMENT OF ACQUITTAL DATED 28.04.2017 PASSED BY THE XLII ADDITIONAL C.M.M., BENGALURU IN C.C.NO.2188/2016 ACQUITTING THE ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF THE NEGOTIABLE INSTRUMENTS ACT.

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THIS CRIMINAL APPEAL COMING ON FOR FINAL HEARING THIS DAY, THE COURT THROUGH VIDEO CONFERENCE AT BENGALURU DELIVERED THE FOLLOWING:

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JUDGMENT

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Appeal is directed against the Judgment dated 28.04.2017 passed in C.C.No.2188/2016 by the XLII

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ACMM, Bengaluru, wherein accused came to be acquitted for the offence punishable under Section 138 of the Negotiable Instruments Act. Being aggrieved by the said Judgment complainant has come in appeal.

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In order to avoid confusion and overlapping parties are referred in accordance with the ranks held by them before the trial court.

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Complainant had presented a case under Section 200 Cr.P.C against the accused for the offence punishable under Section 138 of the Negotiable Instruments Act.

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The substance of the complaint is that complainant is a company registered under the Companies Act, 1956 and engaged in business of promoting and conducting chits as per provisions of the Chit Funds Act, 1982. In September 2012 complainant has opened a Chit Group S.H-5 for total chit value of Rs.3,00,000/- on monthly installment of Rs.10,000/- for total period of 30 months. Accused subscribed Ticket No.14. At 3^rd monthly auction held on 15.11.2012 accused successfully bid the chit amount and won price amount of Rs.2,10,000/- which was received by accused through cheque. Thereafter accused has become a defaulter to the tune of

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Rs.1,40,580/- including interest till 07.09.2015. On repeated requests towards payment of due accused issued cheque bearing No.819872 dated 07.09.2015 for Rs.1,40,580/- drawn on State Bank of India, Nagadevanahalli Branch, Bengaluru. On presentation the said cheque it got dishonoured and returned with endorsement “funds insufficient” dated 09.09.2015. Thereafter on 07.10.2015 complainant got issued a legal notice to accused through RPAD. The notice sent to the residential address returned with shara as “addressee left” but the notice sent to working address was served upon the accused on 08.10.2015. After receipt of notice accused instead of complying with the notice sent untenable reply dated 21.10.2015 through his advocate. The complainant filed the complaint on 19.11.2015.

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Learned trial Judge was accommodated with oral evidence of PW-1-B.S.Manjunath and DW-1Manjunatha M.H. and documentary evidence on behalf of the complainant Ex.P-1-Letter of authority, P-2Cheque, Ex.P-2(a)- The signature of accused, P-3Bank Memo, P-4-Office copy of the legal notice, P-4(a) & (b) –Postal receipt, P-4(c) – Postal acknowledgement, P-5-Reply notice and P-6complaint. No documents were marked on behalf of accused.

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Learned counsel for complainant Sri.B.Vijay Shetty submits at third monthly auction accused successfully bid the chit and won the price amount of Rs.2,10,000/-. The chit amount was Rs.3,00,000/date of bidding 15.11.2012 and price amount won by accused is Rs.2,10,000/- and received price money through cheque and accused has raised false defence

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regarding payment, suppression and fraud on the complainant. The trial court has not applied legal principles enunciated under Sections 139, 20 of the Negotiable Instruments Act and concept of holder in due course.

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Learned counsel for accused submits that

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accused has made payment of Rs.29,140/- on 20.04.2012 and Rs.10,000/- on 17.10.2012. Insofar as payment of Rs.29,140/- is concerned learned counsel submitted that it was the fourth chit and accused paid Rs.29,400/- in advance for further two premiums. It is necessary to make a mention that the scheme of chit that on payment of entire subscription amount of Rs.10,000/-, bid amount will be deducted that will be shared among the members and balance only is paid by way of monthly premium. The only two payments that could be seen from Ex.D-1

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Rs.29,140/- and Rs.10,000/- and also perused the chit ledger produced and objections were also filed and in the ends of natural justice documents are perused and considered.

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Complainant has shown his bonafides by producing promissory note obtained for Rs.3,00,000/-. However the present cheque amount is for Rs.1,40,580/- which circumstances propel that the complainant has maintained bonafide and is absolutely entitled for presumption and the accused has presented contradictory theory such as payment of three premium amounts of Rs.29,140/-.

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Learned counsel for complainant submits amount

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paid through cash was about Rs.2,56,000/- and as per Ex.D-1 Rs.34,000/- and total payment made by him is Rs.2,90,000/-. Regard being had to the fact that the

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liability claimed under the chit is Rs.1,40,580/-. Thus the accused has come up with series of unreliable theories, his defence is false his conduct does not appear to be clean. It is established that he as a member with ticket No.14 has bid the chit and received the amount through cheque, payment details shows how he became defaulter and explanation given

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by him regarding payment is far from truth or reality.

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However the learned trial Judge without perusing any of the facts stated above went on to dismiss the complaint which Judgment is liable to be set aside.

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Thus, accused is found guilty of the offence punishable under Section 138 of the Negotiable Instruments Act.

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Hence, the following:

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ORDER

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Appeal is allowed. Judgment of acquittal passed in C.C.No.2188/2016 dated 28.04.2017 is hereby set

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aside and accused is convicted for the offence punishable under Section 138 of Negotiable Instruments Act and sentenced to pay fine amount of Rs.1,75,000/-. Out of which Rs.1,60,000/- is payable to complainant by way of compensation. Balance Rs.15,000/- shall be remitted to State Exchequer. In default of payment of fine accused shall undergo simple imprisonment for a period of six months.

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Sd/JUDGE

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SBN

Gopalakrishna Chit Funds Pvt. Ltd. v. Manjunatha M H

Case brief

What is this about?

What did the court decide?

Gopalakrishna Chit Funds Pvt. Ltd. v. Manjunatha M H

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

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