Bangalore District Court
M/S. Ninjacart Services Pvt Ltd vs Jayanth Treders on 22 April, 2026
KABC030376042025
IN THE COURT OF THE XXV ADDL. CHIEF JUDICIAL
MAGISTRATE, AT BANGALORE CITY
Dated this the 22nd day of April, 2026
Present : SRI. GOKULA. K
B.A.LL.B.
XXV Addl. Chief Judicial Magistrate,
Bangalore City.
C.C.No.21782/2025
Complainant : M/s Ninjacart Services Private Limited
R/o.Helios Business Park
E Block, 2nd floor,
Opp: New Horizon College Bus stop
Service Road,
Kadabeesanahalli,
Bengaluru 560 103.
Rep by its Associate Manager
Mr.Adarsh.R.
(By SGA Advocate )
V/s
Accused : Jayanth Traders
S/o late Venkataiah
Goravanahalli, Kasaba Hobli
Maddur Taluk
Goravanahalli,
Mandya
Karnataka
Rep by Proprietor
Goravanahalli Ventataiah Govindraju
(By VSP - Advocate )
Plea of accused: Pleaded not guilty
Final Order: Accused is Convicted
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C.C.No.21782/2025
Date of judgment : 22.04.2026
JUDGMENT
The complainant has filed the complaint under Section 223
of Bharathiya Nagarika Suraksha Sanhitha 2023 against the
accused for the offences punishable under Section 25 of The
Payment and Settlement Systems Act 2007 r/w Section 138 of
Negotiable Instruments Act.
2. The brief case of the complainant is as under:
That the complainant is involved in the business of
wholesale trading of agricultural products and fresh produce
supply. The complainant is tied up with Non Banking Financial
Institution and enables service of credit facility to its borrowers.
That Trillionloans Fintech Private Limited has entered a
partnership agreement with the complainant and authorizes the
complainant to act as agent on behalf of Trillionloans Fintech
Private Limited. The accused engaged in the business of whole
sale trade and agricultural products and commission agency.
The accused applied for loan before the complainant through
Trillionloans Fintech Private Limited in loan application
No.294960 and the complainant extended credit facility to the
accused on 20.06.2024 for a sum of Rs.8,45,974/- out of which
the accused availed sum of Rs.3,00,000/-. Since the accused
had applied loan in online platform, he has also signed the loan
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C.C.No.21782/2025agreement and other documents digitally. During the process of
loan transaction, the accused issued signed NACH bearing
UMRN No.USFB7022406243000163 on 24.06.2024 drawn on
Ujjivan Small Finance Bank for a sum of Rs.3,51,115/-.
Initially, the accused assured to make regular payments and
later the accused failed to make payment as per the agreement.
The accused on repeated demands of the complainant,
instructed to present the NACH mandate which is given for
outstanding amount. As per the instructions of the accused, the
complainant has processed NACH mandate through its banker
AU Small Finance Bank, Koramangala for a outstanding sum of
Rs.3,51,115/- and on processing said E NACH Mandate, it is
returned dishonored with remarks “Balance Insufficient” on
04.05.2025. On receipt of said intimation, the complainant got
issued legal notice on 09.05.2025 through registered post and
demanded to pay the amount dishonoured under E-NACH
Mandate. The notice issued to the accused is duly served on
21.05.2025. Inspite of service of notice, the accused failed to
pay the claim amount to the complainant with in the statutory
time. Therefore, the accused has committed the offence
punishable Section 25 of the Payment and Settlement Systems
Act 2007 r/w Section 138 of Negotiable Instruments Act.
Therefore the complainant has filed the complaint.
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3. On the basis of Private complaint filed by the complainant,
this court taken cognizance of offence and registered the case in
PCR No.9614/2025 and recorded sworn statement of the
authorized officer of complainant as PW 1 and got marked 10
documents as Ex.P1 to Ex.P.10. This court by considering the
material on record issued process under Section 227 of
Bharathiya Nagarika Suraksha Sanhita by registering the
criminal case. In response to the process issued by this court,
the accused appeared before this court and he is released on
bail. The copy of the complaint is served to the accused along
with the summons as contemplated under Section 230 of
Bharathiya Nagarika Suraksha Sanhita.
4. The substance of the acquisition as provided Section 274
of Bharathiya Nagarika Suraksha Sanhita is read over to the
accused and his plea is recorded. The accused has pleaded not
guilty and claimed to be tried.
5. In view of the law laid down by Hon’ble Supreme Court of
India in Indian Bank Association V/s Union of India and others
reported in AIR 2014 SCW 3463, the affidavit filed by the
complainant at the stage of taking cognizance and documents
marked is treated as evidence under section 145 of Negotiable
Instruments Act. As the evidence of complainant is on record
the incriminating circumstances in the evidence of complainant
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C.C.No.21782/2025
is read over to the accused and his statement under Section 351
of BNSS is recorded. On the application of accused the PW 1 is
recalled for cross examination. Inspite of grant of opportunity,
the accused has not cross examined PW 1. Hence, cross
examination of PW 1 taken as Nil. Inspite of grant of sufficient
opportunities, the accused has not lead defence evidence.
Therefore the defence evidence is taken as nil.
6. Heard arguments of learned counsel for the complainant and
Arguments of learned counsel for the accused is taken as heard
and perused the material on record.
7. On the basis of the material on record the following points
arise for the consideration of this court :
1. Whether the complainant proves beyond
reasonable doubt that the accused has issued
NACH Mandate bearing UMRN No.UMRN
No.USFB7022406243000163 on 24.06.2024
drawn on Ujjivan Small Finance Bank for a sum
of Rs.3,51,115/- in favour of the complainant and
on processing for collection of balance amount of
Rs.3,51,115/- it is dishonoured for the reason
“Balance Insufficient” on 04.05.2025 and inspite
of receipt of demand notice dated 09.05.2025 on
21.05.2025 the accused has failed to repay the
amount with in the statutory period and thus
committed an offence punishable under Section
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C.C.No.21782/202525 of The Payment and Settlement Systems Act
r/w Section 138 of Negotiable Instruments Act ?
2. What Order or Sentence?
8. The findings of this court to the above points are as follows:
Point No.1 In the Affirmative,
Point No.2 As per final order,
for the following :
REASONS
9. POINT NO.1: To prove the case the authorized representative
of the complainant is examined as PW-1 and in his evidence
affidavit he has reiterated the averments made in the complaint.
The complainant is a company incorporated under Companies
Act which is tied up with NBFC, the Trillion Loans Fine Tech
limited, facilitating loan facility as a assignee. To prove the
incorporation of the company the PW 1 has produced the true
copy of certificate of incorporation as Ex.P 1. The PW 1 has
produced the true copy of Resolution of Board of Directors of
the company as Ex.P 2. The PW 1 has also produced the
authorization letter issued by Trillion loans as Ex.P.3. As per
Ex.P1 to Ex.P3, the PW1 is authorized to represent the
complainant company and prosecute the cases filed by the
complainant. These documents prove the legal status of the
complainant as a Company and authority of PW 1 to represent
the complainant company.
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C.C.No.21782/2025
10. The PW 1 has deposed that the accused approached the
complainant for loan facility through M/s Trillion Loans Fintech
Pvt Ltd and on the application of the accused M/s Trillions Loan
Fintech Pvt Ltd, sanctioned the credit facility of Rs.8,45,974/-
and the accused availed a sum of Rs.3,00,000/-. It is stated
that the complainant is service provider and assignee of Trillion
Loans. He has deposed that the accused has agreed to repay the
loan as per the terms and conditions of the loan agreement. The
accused approached for loan on online platform, he has digitally
signed the loan documents. He has produced said loan
documents as Ex.P 4. In the sanction letter there is clear
authorization by Trillion Loans fine-tech pvt Ltd to the
complainant to recover the loan and also process the NACH
mandate or any other mandate on behalf of Trillion Loans. The
PW 1 further deposed that during the process of loan
transaction the accused issued signed NACH mandate bearing
UMRN No.USFB7022406243000163 on 24.06.2024 drawn on
Ujjivan Small Finance Bank for a sum of Rs.3,51,115/- in
favour of the complainant towards due discharge of
debt/liability. The complainant has produced the E copy of the
NACH Mandate as Ex.P 5. He has deposed that initially the
accused made regular payments and later the accused failed to
make payment as per the agreement. He has deposed that the
accused on repeated demands of the complainant, instructed to
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C.C.No.21782/2025
present the NACH mandate which is given for outstanding
amount. He has deposed that as per the instructions of the
accused, the complainant has processed E-NACH mandate
through their banker AU Small Finance Bank, Koramangala for
a outstanding sum of Rs.3,51,115/-and on processing said E
NACH Mandate, it is returned dishonored with remarks
“Balance Insufficient” on 04.05.2025. The PW 1 has produced
the debit transaction return memo as Ex.P 6. The PW1 has
deposed that they have got issued legal notice dated 09.05.2025
calling upon the accused to pay the due amount as per Ex.P7.
The PW 1 has deposed that said notice returned with the reason
“Item returned unclaimed” on 21.05.2025. The complainant
has issued notice to the last known address of the accused as
mentioned in the loan documents and the notice returned for
the reason “No such person”. It is stated that the notice is
issued to the correct address of the accused furnished in loan
papers. Hence, the notice is deemed to be served on the
accused. Evidencing the same, PW 1 has also produced the
postal receipt and the returned postal envelope as Ex.P 8 and
Ex.P 9. He has deposed that inspite of service of demand notice
the accused has not paid the amount and thus committed the
offence.
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C.C.No.21782/2025
11. The offence alleged is primarily under Section 25 of The
Payment and Settlement Systems Act 2007, which reads as
under.
Section 25. Dishonour of electronic funds transfer for
insufficiency, etc., of funds in the account.
(1) Where an electronic funds transfer initiated by a person from
an account maintained by him cannot be executed on the ground
that the amount of money standing to the credit of that account
is insufficient to honour the transfer instruction or that it
exceeds the amount arranged to be paid from that account by an
agreement made with a bank, such person shall be deemed to
have committed an offence and shall, without prejudice to any
other provisions of this Act, be punished with imprisonment for a
term which may extend to two years, or with fine which may
extend to twice the amount of the electronic funds transfer, or
with both:
Provided that nothing contained in this section shall apply
unless–
(a) the electronic funds transfer was initiated for payment of any
amount of money to another person for the discharge, in whole
or in part, of any debt or other liability;
(b) the electronic funds transfer was initiated in accordance with
the relevant procedural guidelines issued by the system provider;
(c) the beneficiary makes a demand for the payment of the said
amount of money by giving a notice in writing to the person
initiating the electronic funds transfer within thirty days of the
receipt of information by him from the bank concerned regarding
the dishonour of the electronic funds transfer; and
(d) the person initiating the electronic funds transfer fails to
make the payment of the said money to the beneficiary within
fifteen days of the receipt of the said notice.
(2) It shall be presumed, unless the contrary is proved, that the
electronic funds transfer was initiated for the discharge, in whole
or in part, of any debt or other liability.
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C.C.No.21782/2025
(3) It shall not be a defence in a prosecution for an offence under
sub-section (1) that the person, who initiated the electronic
funds transfer through an instruction, authorisation, order or
agreement, did not have reason to believe at the time of such
instruction, authorisation, order or agreement that the credit of
his account is insufficient to effect the electronic funds transfer.
(4) The Court shall, in respect of every proceeding under this
section, on production of a communication from the bank
denoting the dishonour of electronic funds transfer, presume the
fact of dishonour of such electronic funds transfer, unless and
until such fact is disproved.
(5) The provisions of Chapter XVII of the Negotiable Instruments
Act, 1881 (26 of 1881) shall apply to the dishonour of electronic
funds transfer to the extent the circumstances admit.
Explanation.–For the purposes of this section, “debt or other
liability” means a legally enforceable debt or other liability, as the
case may be.
12. This provision also specify that the provisions of chapter
XVII of the Negotiable Instruments Act to the extent the
circumstances admit is applicable. The essential ingredients of
section 25 of The Payment and Settlement Systems Act 2007 to
be complied are i) An electronic fund transfer initiated by the
person from his account ii) Processing of the NACH Mandate by
the beneficiary, iii) it returning unexecuted for the reason
insufficiency of funds to honour transfer instructions. iv)
electronic fund transfer was initiated in discharge of any debt or
liability v) it is initiated in accordance with the relevant
procedural guidelines issued by the service provider vi)
Beneficiary making demand with in 30 days of receipt of
information of dishonour by giving notice in writing, vii) failure
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of the person initiating electronic fund transfer to make
payment within the period of 15 days after receipt of the
demand notice. The Payment and Settlement Systems Act 2007
does not prescribe any time limit to file the complaint. Therefore
it is necessary to apply provisions of Section 142 of The
Negotiable Instruments Act. Therefore the complainant shall
present the complaint within a month after expiry of 15 days of
service of notice to the accused. Therefore it is proper to
consider whether the statutory requirements for constituting
offence under Section 25 of he Payment and Settlement Systems
Act 2007 r/w Section 138 of Negotiable Instruments Act is
complied by the complainant.
13. The NACH mandate is dishonoured on 04-05-2025, the legal
notice is issued on 09.05.2025. It is deemed to be duly served
on 21.05.2025. Therefore cause of action arise for prosecution
of the accused on expiry of 15 days of service of notice on
05-06-2025. The complaint is filed before this court on
10-06-2025. Thus the complainant has complied all the
statutory requirements under Section 25 of Payment and
Settlement Systems Act. As provided under Section 25(4) of The
Payment and Settlement Systems Act and also under Section
146 of Negotiable Instruments Act law presumes that on
production of banker slip or memo having thereon the official
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mark denoting that the cheque/ electronic fund transfer has
been dishonored, presume the fact of dishonor of such said
cheque, unless and until same is disproved. The accused has
not cross examined PW 1 nor adduced evidence to rebut the
presumption. The accused has not denied his address in the
postal envelop nor issued reply to the demand notice. Therefore,
the complainant is entitled for presumption under Section 25 (2)
of The Payment and Settlement Systems Act 2007. Under
Section 139 of Negotiable Instrument Act also there is similar
presumption. The provisions of Section 139 of Negotiable
Instrument Act reads as under:-
139- Presumption in favour of holder – It
should be presumed, unless the contrary is
proved, that the holder of a cheque received
the cheque, of the nature referred to in
section 138 for the discharge, in whole or in
part, of any debt or other liability.
14. Hon’ble Supreme court in a decision reported in (2010) 11
SCC 411 between Rangappa V/s Sri Mohan has held that –
The presumption mandated by Section 139
of the act does indeed include the existence
of a legally enforceable debt or liability.
It is also observed that
Section 139 of the Act is an example of a
reverse onus clause that has been included
in furtherance of the legislative objective of
improving the credibility of negotiable
instrument. It is also held that in such a
scenario, the test of proportionality should
guide the construction and interpretation of
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C.C.No.21782/2025
reverse onus clauses and the defendant
caused cannot be expected to discharge an
unduly high slandered or proof.
15. Therefore the principles laid down in this decision can also
be made applicable to the proceedings for the offence under
Section 25 of The Payment and Settlement Systems Act 2007. In
view of the principles laid down in these decisions onus is on
the accused to rebut the presumption. The accused has not
issued any reply at the initial stage at the time of service of the
legal notice. The accused has also not cross examined PW 1
inspite of grant for sufficient opportunity and not lead his
evidence. Therefore there is no defence by the accused to rebut
the presumption. The accused has not utilized the opportunity
to defend the case.
16. The complainant by producing the loan documents Ex.P 4
established availment of loan by the accused by executing loan
documents in digital form. These documents bears digital
signature of the accused. The accused has also not chosen to
cross examine PW 1 or to lead defence evidence to rebut the
case put forward by the complainant and to contradict the
evidence placed on record. Therefore this court concludes that
accused has failed to rebut the presumption under Section 25
(2) of The Payment and Settlement Systems Act 2007 r/w
Section 139 of Negotiable Instruments Act. Therefore this court
concludes that the complainant has successfully proved that
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C.C.No.21782/2025
the accused has committed the offence punishable under
Section 25 of The Payment and Settlement Systems Act 2007
r/w. Section 138 of Negotiable Instruments Act. Therefore this
court answers the above point No.1 in the Affirmative.
17. POINT NO. 2 : While answering the point no. 1 this court
concluded that the complainant proved that the accused
committed the offence punishable under Section 25 of The
Payment and Settlement Systems Act r/w Section 138 of
Negotiable Instruments Act. The Amount covered under the
NACH is Rs.3,51,115/-. The NACH mandate is processed for
collection on 04-05-2025. The money involved in the case is
used in commercial transactions. Therefore considering all these
aspects the amount of fine calculated for a sum of
Rs.3,85,080/-.
18. The Hon’ble High Court of Karnataka in the reportable
decision in CRL.RP No. 996 of 2016 dated 09-07-2025 between
M/s Banavathy and Company VS Mahaveer Electro Mech (P)
Ltd at para 21 has held that –
21. In case lesser interest is awarded and only
default sentence is imposed, the rigor of offence
under Section 138 will be diluted and thereby the
object of the Statute will be defeated. If recovery and
compensatory part is not taken care of while
determining the quantum of sentence and
appropriate interest is not awarded, until the date of
recovery of the entire amount, the complainant will
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C.C.No.21782/2025
be forced to file civil suit on the same subject matter.
In view of Section 143(3) the trial for offence under
Section 138 of N.I.Act has to be completed within six
months. If the said provision is not adhered to and
the trial for the offence under Section 138 of N.I.Act
takes 4 to 5 years, in the mean time, the claim of the
complainant for recovery of the cheque amount by
filing civil suit becomes barred by limitation. Not
only that the accused who is convicted for offence
under Section 138 of N.I.Act challenges the same
before the Sessions Court wherein the matter takes
2 to 3 years. The accused unsuccessful in the said
appeal prefers revision petition before the High
Court and it is seen that the disposal of revision
takes more than 5 years. After all this if the
complainant has to receive the fine/compensation as
awarded by the trial Court, if it is cheque amount or
little higher than the cheque amount, he will be at
loss and put to injustice. Therefore, while passing
the order of sentence after determining the
fine/compensation, the Court shall also pass an
order to pay future interest @ 9% p.a. on the
compensation amount payable to the complainant
by fixing time of one/two months to deposit
compensation amount so that even if the matter is
challenged before the Sessions Court in appeal and
High Court in revision the interest of the
complainant will be protected.
Therefore considering directions issued by the Hon’ble High
Court issued in the above refereed judgment, it is also proper to
direct the accused to pay future interest on the fine amount at
the rate of 9 % P.A. till payment. Therefore considering all these
aspects this court proceed to pass the following –
ORDER
By exercising powers conferred under Section 278(2) of
Bharathiya Nagarika Suraksha Sanhitha the accused is
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C.C.No.21782/2025
convicted for the offence punishable under Section 25 of The
Payment and Settlement Systems Act 2007 R/w Section 138 of
Negotiable Instrument Act and he is sentenced to pay a fine of
Rs.3,85,080/-. (Rupees Three Lakhs Eighty Five Thousand and
Eighty only) which shall be deposited with in a month and in
default pay interest at the rate of 9% from this day till payment
of fine amount.
In default to pay the fine with interest, the accused shall
undergo simple imprisonment of 6 months.
Further acting Section 395(1)(a) of Bharathiya Nagarika
Suraksha Sanhitha out of the fine amount a sum of Rs.5,000/-
(Rupees Five Thousand only) shall be defrayed as prosecution
expenses to the state.
Further acting Section 395(1)(a) of Bharathiya Nagarika
Suraksha Sanhitha a sum of Rs.3,80,080/-. (Rupees Three
Lakh Eighty Thousand and Eighty only) with interest out of the
fine amount on recovery shall be paid as compensation to the
complainant and the complainant shall credit the same to the
loan account of the accused.
Supply free copy of the judgment to the accused.
(Dictated to the Stenographer directly on the computer, typed
by her, corrected and signed then pronounced by me in the open
court on this the 22nd day of April 2026).
(GOKULA.K)
XXV A.C.J.M., BANGALORE CITY.
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C.C.No.21782/2025
ANNEXURE
LIST OF WITNESSES EXAMINED FOR THE COMPLAINANT:
PW1 : Adarsh.R
LIST OF DOCUMENTS MARKED FOR THE COMPLAINANT:
Ex.P1 : Notarized copy of Incorporation
Certificate
Ex.P2 : Notarized Copy of the Board Resolution
Ex.P3 : Authorization Letter
Ex.P4 : Copies of key fact, statement, sanction
letter, loan agreement, mandate
Ex.P5 : NACH Mandate
Ex.P6 : Dishonour Memo
Ex.P7 : Office copy of Legal Notice
Ex.P8 : Postal Receipt
Ex.P9 : Returned postal envelope
Ex.P10 : Certificate U/s.63 of BSA.
LIST OF WITNESSES EXAMINED FOR THE ACCUSED:-
Nil
LIST OF DOCUMENTS MARKED FOR THE ACCUSED:-
Nil
(GOKULA.K.)
XXV A.C.J.M., BANGALORE CITY.
