Karnataka High Court
Sri. K. Srinivas Reddy vs Yashwanth Enterprises on 25 February, 2022
Bench: Rajendra Badamikar
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 25TH DAY OF FEBRUARY, 2022
BEFORE
THE HON'BLE MR. JUSTICE RAJENDRA BADAMIKAR
CRIMINAL APPEAL No.1824/2018
BETWEEN:
SRI. K. SRINIVAS REDDY
AGED ABOUT 50 YEARS
PROPRIETOR, CHANDRA KIRAN ENTERPRISES
HAVING ITS OFFICE AT NO.15 &16
MB & MB TRUST COMPLEX, SUBASHNAGAR
VIRGONAGAR POST, BANGALORE-49. ....APPELLANT
(BY SMT. S. JAYANTHI, ADVOCATE)
AND:
1. YASHWANTH ENTERPRISES
NO.403/A, 4TH FLOOR
RICHMOND PLAZA, RICHMOND CIRCLE
RAJARAM MOHAN RAI ROAD
BANGALORE-560 025
REP. BY ITS PROPRIETOR
SHANTHA KUMAR REDDY
2. SRI. SHANTHA KUMAR REDDY
PROPRIETOR, YASHWANTH ENTERPRISES
NO.403/A, 4TH FLOOR
RICHMOND PLAZA, RICHMOND CIRCLE
RAJARAM MOHAN RAI ROAD
BANGALORE-560 025 .... RESPONDENTS
(BY SRI. ANOOP HARANAHALLI, ADVOCATE FOR
SRI. SRINIVAS RAO, ADVOCATE)
2
THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378(4)
OF CR.P.C. PRAYING TO SET ASIDE THE JUDGMENT DATED
06.08.2018 PASSED BY THE LVIII ACMM, MAYO HALL UNIT,
BANGALORE (ACMM-58) IN C.C.NO.50978/2014, ACQUITTING
THE RESPONDENT/ACCUSED FOR THE OFFENCE P/U/S 138 OF
THE N.I.ACT.
THIS CRIMINAL APPEAL HAVING BEEN HEARD AND
RESERVED FOR JUDGMENT ON 16.02.2022, COMING ON FOR
'PRONOUNCEMENT JUDGMENT' THIS DAY, THE COURT
DELIVERED THE FOLLOWING:
JUDGMENT
Though this appeal is listed for admission, with the
consent of the learned counsels appearing for the parties on
both sides, the same is taken up for final disposal.
2. The appellant/complainant has filed this appeal
under Section 378(4) of Criminal Procedure Code, 1973
('Cr.P.C.' for short), challenging the judgment of acquittal
dated 06.08.2018 passed by the Court of LVIII Additional
Chief Metropolitan Magistrate, Mayo Hall Unit, Bengaluru, in
CC No.50978/2014, whereby the learned Magistrate has
acquitted the accused for the offence punishable under
Section 138 of the N.I. Act ( 'N.I. Act' for short).
3. For the sake of convenience, the parties herein
are referred with the original ranks occupied by them
before the trial Court.
4. The brief factual matrix leading to this case are
as under:-
The complainant is a proprietary firm carrying on
business of Civil Contract in the name and style as 'Chandra
Kiran Enterprises'. Accused No.1 is also a proprietary
concern. The accused No.2 in the month of October 2011
approached the complainant and sought for carrying out the
work of trenching and ducting at National Highway between
Hubli and Belgaum as sub-contract, by assuring the
complainant to make necessary payment in respect of
execution of the work, after completion of work. It is the
further case of the complainant that, it has promptly
completed the said work and thereafter submitted Invoice
for Rs.8,23,000/- towards the work of trenching and
ducting. After receipt of Invoice, the accused has issued a
cheque bearing No.467630 dated 10.04.2013 for
Rs.3,00,000/- towards part-payment and sought for some
further time to pay the balance amount of Rs.5,23,000/-.
The complainant has presented the said cheque through
his banker on 06.05.2013, but the said cheque was
returned with an endorsement 'Funds Insufficient' on
15.05.2013. Even the complainant has personally met the
accused and requested him to make the balance payment.
But, the accused did not respond and as such, the
complainant has got issued a demand legal notice on
07.06.2013. The said notice was duly served on accused
on 08.06.2014. But, the accused neither replied the said
notice nor paid the cheque amount. Therefore, it is alleged
that, accused has committed offence under Section 138 NI
Act. As such, the complainant has lodged a complaint in
this regard.
5. The learned Magistrate has taken cognizance of
the alleged offence and after recording sworn statement of
the complainant, found that there is material evidence to
proceed against the accused and hence the process came to
be issued against the accused. The accused appeared
before the Court in pursuance of summons and was
enlarged on bail.
6. The substance of accusation under Section 138 of
the NI Act was read-over and explained to the accused.
The accused pleaded not guilty and claimed to be tried.
The complainant was examined himself as PW.1 and he has
also got examined one witness on his behalf as PW.2-Sri.
Syed Ismail and he has also placed reliance on Ten
documents, marked as Exs.P1 to P10. Exs. D1 and D2
were got marked during cross-examination of PW.1 by way
of confrontation.
7. After conclusion of evidence of prosecution, the
statement of accused under Section 313 of Cr.P.C. was
recorded to enable the accused to explain the incriminating
evidence appearing against him in the case of prosecution.
The case of accused is of total denial and he has also got
examined himself as DW.1 to substantiate his defences and
further, he got marked three more documents as Exs. D3 to
D5.
8. After hearing arguments and after perusing the
material evidence placed on record, the learned Magistrate
has found that the complainant has failed to establish that
the cheque (Ex.P2) was issued towards legally enforceable
debt and further observed that ingredients of Section 138 of
the NI Act are not established and as such, he acquitted the
accused for the offence under Section 138 of the NI Act.
Being aggrieved by this judgment of acquittal, the
complainant has filed this appeal.
9. Heard the arguments advanced by the learned
counsels appearing for appellant and respondent, and also
perused the material records of the trial Court.
10. Learned counsel for the appellant would contend
that the impugned judgment of acquittal passed by the trial
Court is illegal and contrary to law. He would also contend
that the trial Court has failed to appreciate the oral
evidence of PW.1 and PW.2 in proper perspective and has
given unnecessary importance to the fact that, Ex.P1
(Invoice) does not contain VAT, CST ad TAN Service
Register Numbers, which is not the relevant factor, and that
the trial Court has failed to consider that, accused himself
has admitted that, he was entrusted with the work of
trenching and ducting from Belgaum to Kolhapur. He
would also contend that the trial Court has failed to
appreciate the oral and documentary evidence in a proper
perspective. He would further contend that the trial Court
has wrongly observed that the evidence of PW.1 and PW.2
is inconsistent and contrary. He would also contend that
the trial Court has failed to notice the fact that the accused
has not even bothered to reply the legal notice and an
adverse inference is required to be drawn and as such the
presumption under Section 139 of the N.I. Act ought to
have been drawn in his favour and therefore, he would
contend that the judgment of acquittal suffers from
perversity and illegality and calls for interference by this
Court. As such, he would seek for allowing the appeal by
setting aside the judgment of acquittal, and sought for
convicting the accused/respondent herein.
11. Per contra, the learned counsel for
respondent/accused would support the judgment of
acquittal passed by the trial Court. He would also contend
that the evidence is inconsistent and it is not supported by
any documentary evidence regarding accused entrusting
sub-contract to the complainant pertaining to work of
trenching and ducting from Hubli to Belgaum. He would
also contend that the records disclose that the work from
Hubli to Belgaum was entrusted to a different firm as
admitted by PW.1, which is evident from Ex.D1 and PW.1
does not know anything regarding execution of work, and
the evidence of PW.2 is not trust-worthy. Hence, he would
contend that the presumption in favour of the complainant
is rebutted by placing material evidence and as such, he
has sought for dismissal of the appeal.
12. Having heard arguments advanced by the
learned counsels appearing on both sides and perusing the
records, it is evident that, both complainant and accused
are the Proprietary Firms. The complainant claims that, he
is carrying on business of Civil Contract Work. It is the
case of complainant that, Accused No.1 was entrusted with
the work of laying ducts from Hubli to Belgaum and
Accused No.2 given sub-contract to the complainant.
However, it is important to note here that, there is
absolutely no document or material evidence regarding
sub-contract between accused and complainant. There is
absolutely no pleading in the complaint regarding terms of
the alleged sub-contract.
13. PW.1 was examined, who is the proprietor of the
complainant-Firm and he reiterated the complaint
allegations. He has placed reliance on Ex.P1 (Invoice)
regarding execution of Work Order. But, admittedly the
complainant-Firm is a proprietary concern. In that view of
the matter, it should be a registered firm. But, on perusal
of Invoice (Ex.P1) discloses that, it does not contain CST,
TAN or any other registration numbers. Even Ex.P1
(Invoice) is not on the Letter Head of the complainant-Firm.
Apart from that, on perusal of Ex.P1 (Invoice), it is evident
that, it is pertaining to submission of full and final bill for
trenching and ducting work on Belgaum Back Bone and it
does not refer the work between Belgaum and Hubli. In the
cross-examination, PW.1 has stated that, he has done
trenching work for about 8 to 9 Kms., but, he is unable to
say from which place and till which place the trenching work
was executed by the complainant. He pleads ignorance
regarding exact work turned-out and simply states that
everything is within the knowledge of his supervisor. Apart
from that, all along it is the claim that the complainant is a
Civil Contractor. But, PW.1 in his cross-examination, on
Page No.7, in Para-2 has admitted that, he has not
obtained any licence of Civil Contract Work. When the
complainant has not obtained licence for Civil Contract
Work, question of he executing contract work pertaining to
trenching work does not arise at all. Even the cross-
examination of PW.1 disclose that, he does not know the
nature of work. He admits that, in Ex.P1 (Invoice), the
date of receipt was also wrongly mentioned and he further
admits that, he has not made any attempts to obtain Work
Order. He has also admitted Ex.D1 (Work Order) when it
was confronted to him. But, on perusal of Ex.D1 (Work
Order), it discloses that the work of trenching and ducting
from Dharwad to Belgaum was entrusted to one M/s.
Fastrack Teleservices situated at Bengaluru. When the
work between Dharwad to to Belgaum was entrusted to
M/s. Fastract Teleservices and not to the accused/firm,
question of accused giving sub-contract in this area to the
complainant does not arise at all.
14. In further cross-examination, PW.1 has admitted
that, Ex.D2 is the Work Order issued to Accused No.1 from
Belgaum to Kolhapur. PW.1 does not know whether the
licence was obtained from the concerned department for
trenching etc. and his evidence disclose that, he do not
know anything. Further according to complainant, still
there is a due to the tune of Rs.5,23,000/- from accused,
but, admits that he has not taken any steps in this regard.
Even he pleads ignorance regarding from where he secured
materials for executing the work. All along it is pleaded
that, sub-contract work was entrusted between Hubli to
Belgaum. But, Ex.D1 disclose that the said work between
Hubli to Belgaum was not entrusted to Accused No.1 and as
per Ex.D2, Accused No.1 was entrusted with the work from
Belgaum to Kolhapur. On the contrary, Ex.P1 (Invoice)
itself disclose that trenching and ducting work at Belgaum
Back Bone was alleged to have been executed, but not
between Hubli to Belgaum. Apart from that, when the
complainant is not a Civil Contractor, question of it
undertaking sub-contract for trenching and ducting does
not arise at all.
15. The complainant has got examined PW.2-Syed
Ismail, who claimed to have worked under the complainant
as a Supervisor during the relevant period on a salary of
Rs.12,000/- p.m.. But, his evidence disclose that the
complainant was given sub-contract of trenching and
ducting work between Belgaum and Sankeshwar. He claims
that the Manager of Accused No.2 has shown the spot,
where the work has to be executed. He tried to give an
explanation that the complainant has wrongly given
evidence of execution between Hubli and Belgaum, as they
are on the side of National Highway. But, the said
explanation holds no water at all, as it is for the
complainant/PW.1 to explain and not PW.2. The
complainant all along has specifically asserted that sub-
contract between Hubli and Belgaum was entrusted to
him. But, PW.2 claims that it was between Belgaum to
Sankeshwar. Apart from that, Ex.P1 speaks a different
story in this regard, as it is pertaining to execution of work
at Belgaum Back Bone, but not either between Hubli and
Belgaum or Belgaum and Sankeshwar. PW.2 in further
cross-examination claimed that he has executed the work
between Belgaum and Sankeshwar for 8 to 9 Kms.
Admittedly, the distance between Belgaum and Sakeshwar
is around 50 Kms.. The complainant all along asserted
that, all the factual details were within the knowledge of his
Supervisor i.e., PW.2. But, PW.2 did not disclose as to
where exactly he has executed the work and between which
places. He specifically admitted that he has not executed
any work between Hubli and Belgaum and if this admission
is taken into consideration, then the entire story of the
complainant stands falsified. Further, for trenching, certain
Lay-out Maps are required to be prepared. But, PW.2 has
not done anything. He admits that there are no records
regarding payment of wages to labourers, who were
engaged in trenching and ducting work. Further, if at all
any is work executed, the same is required to be certified
and that certification is also not forthcoming. For trenching
adjoining Highway, the licence is required from the
concerned authorities. But, that was also not within the
knowledge of PW.2 or PW.1. Hence, their contention
regarding execution of sub-contract, holds no water. Even
PWs. 1 & 2 do not know as to where exactly the work was
executed, as their evidence is inconsistent.
16. As observed above, the alleged Invoice at Ex.P1,
cannot be taken into consideration, as it speaks regarding
the work executed at Belgaum Back Bone and even it is not
in the Letter Head of the complainant-Firm and it also does
not bear VAT, CST or any other service registration
numbers. Ex.P10 is Income Tax Return, which does not
speak regarding any transaction between the complainant
and accused. DW.1 has specifically asserted that, his
company did not entrust any work to the complainant-
Company. It is the case of accused that, the cheque was
misplaced by his staff and that has been misused by the
complainant and other documents have been manipulated.
Though initial presumption is in favour of the complainant
in view of admission of signature of accused on the cheque,
but the evidence and especially cross-examination of PWs.
1 & 2 clearly establish that they do not know as to where
exactly they have executed work and no material pleadings
are forthcoming. Hence, by cross-examining PWs. 1 & 2,
the accused has rebutted the presumption available in
favour of complainant. Even the complainant does not
know as to where exactly the work was executed for 8 to 9
Kms., and that was also not pleaded in the complaint. The
evidence of PWs. 1 & 2 is inconsistent and contrary to each
other. The evidence of the complainant also disclose that
no due is pending from the accused in respect of the work
from Belgaum to Kolhapur. Even in Invoice-Ex.P1, the seal
of the Accused-Company is not found and whether the
cheque was issued in the capacity of Proprietor or in
individual capacity is also not forthcoming. No documents
have been produced by the complainant to show that the
cheque (Ex.P2) belongs to Accused No.1-Firm. The accused
denied his signature on Ex.P1 (Invoice). There is absolutely
no agreement between the parties for entrustment of work
by accused to complainant by way of sub-contract. Certain
terms and conditions ought to been entered into between
the parties to fix the rate, payment mode etc., but that is
also not forthcoming. Except Ex.P1 (Invoice) and Ex.P2
(Cheque) and other disputed documents, no convincing
material evidence is placed by the complainant to
substantiate his contention regarding execution of work
from Hubli to Belgaum. Though PW.2 has tried to improve
his version that it ought to have been between Belgaum to
Sankeshwar, but that is not clarified by the complainant.
Apart from that, as observed above, the allegations are
regarding execution of work for 8 to 9 Kms., and between
which points this work was executed is also not
forthcoming. The transaction appears to be of civil nature
and it was tried to be given a criminal colour.
17. The learned Magistrate has considered all these
aspects and rightly came to a conclusion that the
complainant has failed to establish the guilt of accused for
offence under Section 138 of NI Act. Hence, after
appreciating the oral and documentary evidence in a proper
perspective, he has rightly acquitted the accused. Hence,
the judgment of acquittal passed by the trial Court does not
suffer from any infirmity or illegality so as to call for any
interference. Under such circumstances, the appeal is
devoid of any merits and needs to be rejected. Accordingly,
I proceed to pass the following:-
ORDER
The appeal is dismissed. The judgment of
acquittal dated 06.08.2018 passed by the trial
Court viz., the Court of LVIII Additional Chief
Metropolitan Magistrate, Mayo Hall Unit,
Bengaluru, in CC No.50978/2019 stands
confirmed.
Sd/-
JUDGE
KGR*
