Bangalore District Court
M/S. Parasmani Marbles Private Limited vs Santhosh Shelters Private Limited on 6 April, 2026
KABC030150972024
IN THE COURT OF THE XXV ADDL. CHIEF JUDICIAL
MAGISTRATE, AT BANGALORE CITY
Dated this the 6th day of April 2026
Present : SRI. GOKULA. K
B.A.LL.B.
XXV Addl. Chief Judicial Magistrate,
Bangalore City.
C.C.No.8405/2024
Complainant : M/s Parasmani Marbles Private Limited
(A duly incorporated company)
registered office at Sy.No.82/2B-1A
Melumalai Village, Samalapalam Post
Shoolagiri District, Krishnagiri 635117
Tamil Nadu
CIN Number UI4296TZ2017PTC028810
GST Number :33AAJCP1388AIZO
Represented by its Director Pradeep Soodani
(By GA -Advocate )
V/s
Accused : 1. Santhosh Shelters Private Limited
(An Incorporated Company)
Having registered office at:
3rd floor, 206/2A, 6th cross,
Nagavarapalya, C.V.Raman Nagar
Bengaluru 560 093.
CIN Number :U45309KA 2017PTC108766
GST Number:29AAZCS6109CIZX
2.Mr. Srinivasan Keeranati Thimmarayan
Aged major
Managing Director :
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C.C.No.8405/2024
Santhosh Shelters Pvt.Ltd.
DIN : 08693787
3. Mrs. Bhagyarathna
Aged major
Director : Santhosh Shelters Pvt.Ltd.,
DIN : 07771459
Both at :
3rd floor, 206/2A, 6th cross,
Nagavarapalya,
C.V.Raman Nagar
Bengaluru 560 093.
Having construction site at :
#6, Mamatha Farm, Gaddige Main Road
Bagadi Village, Kasaba Hobli
Mysore 570 026.
(By MS - Advocate )
Plea of accused: Pleaded not guilty
Final Order: Accused Nos.1 to 3 are convicted
Date of judgment : 06.04.2026
JUDGMENT
The complainant has filed the complaint under Section 200
of Criminal Procedure Code against the accused for the offence
punishable under Section 138 Negotiable Instruments Act.
2. The brief case of the complainant is as under:
That the complainant is a company incorporated under
Companies Act involved in trading and business of marbles,
granites and such other allied business. The Accused No.1 is a
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C.C.No.8405/2024company involved in real estate and construction industry. The
accused no. 1 and 2 are the Directors of Accused no. 1 company
and they are involved in day to day affairs and business of
accused No.1. It is pleaded that the Accused No.2 and 3
approached the complainant for purchase various kinds of
imported marbles. That as per the orders placed by the accused,
the complainant has supplied various kinds of imported
marbles on credit basis to the construction site at Mysore. The
complainant supplied imported marbles under multiple invoices
amounting to ₹.1,74,19,474/-. The accused have made part
payment of only ₹.89,07,842/- and the outstanding due amount
is ₹.85,11,632/-. The same is legally enforceable debt payable
by the accused to the complainant. That towards partial
discharge of said sum, the accused issued the following cheques
all drawn on Karnataka Bank Ltd, Murphy Town Branch,
Bengaluru in favour of the complainant.
1. Cheque bearing No.742094 dated 01.12.2023 for
₹.12,55,086/-
2. Cheque bearing No.742252 dated 05.12.2023 for
₹.11,00,000/-
3. Cheque bearing No.742253 dated 05.12.2023 for
₹.12,00,000/-
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C.C.No.8405/2024
It is pleaded that the complainant presented said cheques
through their banker i.e. State Bank Of India, Electronic City
Branch, Bangalore and the Cheque bearing No.742094 dated
01.12.2023 returned dishonored for the reason “Funds
Insufficient” on 05.12.2023 and Cheque bearing No.742252
dated 05.02.2023 and Cheque bearing No.742253 dated
05.12.2023 returned dishonored for the reason “Payment
stopped by drawer” on 07-12-2023. Hence, the complainant
has issued legal notice dated 22.12.2023 by RPAD and
demanded to pay the sum of ₹.35,55,086/- covered under above
three cheques and the notice is served on accused no. 1 on
26.02.2023 to Mysore Address. It is stated that notice issued to
the accused no. 2 and 3 to their address at Mysore is returned
unclaimed on 01.01.2024 and notice issued to the address at
Bangaluru is returned with endorsement unclaimed on
03.01.2024. Inspite of service of notice, the accused failed to
pay the claim amount to the complainant within the statutory
time. Therefore, the accused has committed the offence under
Section 138 of Negotiable Instruments Act. Therefore the
complainant has filed the complaint.
3. On the basis of Private complaint filed by the complainant,
this court has taken cognizance of offence and registered the
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C.C.No.8405/2024
case in PCR No.3050/2024 and recorded sworn statement of
the director and authrorized representative of the complainant
as PW 1 and got marked 17 documents as Ex.P 1 to P17. This
court by considering the material on record issued process
under Section 204 of Cr.PC by registering the criminal case. In
response to the process issued by this court, the accused
persons appeared through video conference and are released on
bail. The accused no. 2 and 3 are also sought for permanent
exemption from appearing from court and it is allowed. The
accused represented during proceedings through their counsel.
The copy of the complaint is served to the accused persons
along with the summons as contemplated under Section 207 of
Criminal Procedure Code.
4. The substance of the acquisition as provided under
Section 251 of Cr.P.C is read over to the accused persons and
plea is recorded. The accused have 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
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Instruments Act. The PW 1 is recalled on the application of the
accused and subjected to cross examination. After the
conclusion of evidence of the complainant, the incriminating
circumstances in the evidence of PW 1 is read over to the
accused and their statements under Section 313 of Cr.P.C.
recorded through video conference. The accused denied the
same as false. The accused No.2 himself examined as DW 1
through video conference and got marked the documents as
Ex.D1 and Ex.D10. The accused have examined one witness as
DW 2.
6. Heard arguments of learned counsel for the complainant
and arguments of learned counsel for the accused and the
written arguments of the complainant and accused and perused
the materials 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 all
reasonable doubt that the accused no. 2 and 3
being the directors of accused no. 1 company
and responsible for the day today affaires of
accused no. 1 company and the accused no. 2
being the signatory to the cheques drawn from
the account of the accused no. 1 have issued 3
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C.C.No.8405/2024cheques ie Cheque bearing No.742094 dated
01.12.2023 for ₹.12,55,086/-, 2. Cheque
bearing No.742252 dated 05.12.2023 for
₹.11,00,000/-, 3. Cheque bearing No.742253
dated 05.12.2023 for ₹.12,00,000/- all drawn
on Karnataka Bank Ltd, Murphy Town Branch,
Bengaluru in favour of the complainant
towards discharge of legally recoverable debt
and on presentation of the said cheques
through its banker i.e State Bank of India,
Electronic City branch, the said cheques no. 1
referred above are returned for the reasons
“Funds Insufficient” and cheque no. 2 and 3
referred above is dishonored for the reason
“Payment stopped by drawer” on 05.12.2023
and 07.12.2023 and inspite of receipt of
demand notice dated 22.12.2023 on
26.12.2023 the accused have not complied the
demands in the notice and thus committed an
offence punishable under Section 138 of
Negotiable Instruments Act ?
2. What Order of 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 :
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C.C.No.8405/2024
REASONS
9. POINT NO.1: To prove the case the authorised representative
and the director 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 involved in trading and business of
marbles, granites and such other allied business. To prove
incorporation of the company the complainant has produced the
web Copy of the Incorporation Certificate as Ex.P1. This
document proves the legal status of the complainant.
10. The PW 1 has deposed that he is the Director of the
complainant company and involved in the day to day activities
of the complainant company and having personal knowledge
about the transactions with the accused. The complainant has
produced the copy of Resolution passed in the meeting of board
of directors authorizing him to represent the complainant
company and it is marked as Ex.P.2. As per Ex.P 2 PW1 is
authorized to file the complaint, engage advocate, give evidence
on behalf of complainant company.
11. In the cross examination of PW1, the accused has denied
the authority of PW1 to represent the complainant. It is the
contention of the accused that under Exhibit P2, Board
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C.C.No.8405/2024
Resolution no specific authority is given to any person to file the
case against any specific person. There is no authority is given
to prosecute the accused no. 1 to 3 under Exhibit P2 Board
Resolution. But on perusal of Exhibit P2 board resolution,
general authority is given to PW1 to represent the company
before all the law courts and other authorities and to do all the
needful acts on behalf of the complaint company. Therefore, it
also gives authority to PW1 to prosecute the accused on behalf
of complainant company. It is not the case of the accused that
PW1 is not involved in the business transactions between the
complainant and accused and he is not having personal
knowledge about the transactions, therefore he is not competent
to represent the complainant company. The accused has
admitted that the PW1 is involved in the business transactions
on behalf of complainant company with the accused. Therefore,
the competency of PW1 to represent the complainant company
cannot be doubted.
12. The PW 1 has deposed that accused No.1 is a company
involved in real estate and construction industry. The accused
no. 2 and 3 are the Directors of accused no. 1 and they are
involved in day to day affairs and business of the accused No.1.
He has deposed that the accused No. 2 and 3 approached the
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C.C.No.8405/2024
complainant to purchase various kinds of imported marbles.
That as per the orders placed by the accused, the complainant
has supplied various kinds of imported marbles on credit basis
to the construction site at Mysore. He has deposed that they
have supplied imported marbles under multiple invoices
amounting to ₹.1,74,19,474/-. The accused have made part
payment of only ₹.89,07,842/- and a sum of ₹.85,11,632/- is
outstanding due from the accused. He has deposed that said
amount is legally enforceable debt/ liability payable by the
accused to the complainant. He has deposed that they have
maintained ledger account about the transactions with the
accused. He has produced the web copy of the ledger account
as Ex.P.3. The PW 1 has further deposed that towards partial
discharge of said sum, the accused issued the following cheques
all drawn on Karnataka Bank Ltd, Murphy Town Branch,
Bengaluru in favour of the complainant.
1. Cheque bearing No.742094 dated 01.12.2023 for
₹.12,55,086/-
2. Cheque bearing No.742252 dated 05.12.2023 for
₹.11,00,000/-
3. Cheque bearing No.742253 dated 05.12.2023 for
₹.12,00,000/-
The complainant has produced said cheques as Ex.P.4 to Ex.P6.
The PW 1 has further deposed that the complainant presented
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C.C.No.8405/2024
said cheques through their banker i.e. State Bank Of India,
Electronic City Branch, Bangalore and he Cheque bearing
No.742094 dated 01.12.2023 returned dishonored for the
reason “Funds Insufficient” on 05.12.2023 and Cheque
bearing No.742252 dated 05.02.2023 and Cheque bearing
No.742253 dated 05.12.2023 returned dishonored for the
reason “Payment stopped by drawer” on 07-12-2023. Said bank
endorsements are produced as Ex.P.7 to Ex.P.9. The PW 1 has
further deposed they have issued legal notice dated 22.12.2023
to the accused no. 1 to 3 demanding to pay the amount covered
under above said three cheques to their address at Bangalore
and Mysore. The PW1 has produced the office copy of legal
notice as Ex.P 10 and the postal receipts for transmitting the
notice as Es.P 11. The PW 1 has deposed that the notice issued
to the accused no. 1 at Mysore address is duly served on
26.12.2023. The PW 1 has produced the postal acknowledgment
as Ex.P 12. The PW 1 has deposed that the notice issued to the
address of accused no. 2 and 3 at Mysuru and Bengaluru
returned with postal endorsement ‘unclaimed’. He has deposed
that the accused no. 2 and 3 have want only not claimed the
notice knowing contents of the same. The PW 1 has deposed
that inspite of receipt of legal notice the accused failed to
make payments.
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C.C.No.8405/2024
13. Now it is proper to consider where the complainant has
complied all the statutory requirements for commission of
offence under Section 138 of Negotiable Instruments Act. The
essential ingredients of section 138 and 142 of Negotiable
Instruments Act to be complied are i) drawing of the cheque by
the accused ii) presentation of the cheque to the bank with in
the period of three months, iii) returning of the cheque unpaid
by the drawee bank iv) giving notice in writing to the drawer of
the cheque demanding of the payment of cheque amount with
in the period of 30 days, v) failure of the drawer to make
payment within the period of 15 days after receipt of the
demand notice and v) Presentation of the complaint within a
month by the complainant after expiry of 15 days of service of
notice to the accused. Therefore it is proper to consider
whether the statutory requirements for constituting the offence
under Section 138 of Negotiable Instruments Act is complied by
the complainant.
14. The cheques were dated 01.12.2023 and 05.12.2023 and
said cheques were dishonoured on its presentation on
05.12.2023 and 07.12.2023 for the reason “Funds Insufficient”
and “Payment stopped by drawer”. The demand notice is issued
on 22.12.2023. It is duly served to accused no. 1 on
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C.C.No.8405/202426.12.2023 and notice to accused no. 2 and 3 returned with
endorsement unclaimed on 01-01-2024. Therefore the cause of
action arose for prosecution of the accused on failure of the
accused to comply the demands in the notice with in 15 days of
service of notice on 11-01-2024. The complaint is filed before
this court on 06-02-2024 with in the statutory period. Thus the
complainant has complied all the statutory requirements under
Section 138 and 142 of Negotiable Instruments Act.
15. The accused has admitted that the Ex.P 4 to 6 cheques were
drawn from the account of the accused no.1. It is also admitted
that accused no. 2 has affixed his signature to Ex.P 4 to 6
cheques representing the accused no. 1 company. The accused
has also not disputed that the cheques Ex.P 4 to 6 were issued
to the complainant, but they contended that said cheques were
issued for security and not for payment of amount. As provided
under Section 146 of Negotiable Instruments Act, law presumes
that on production of bankers slip or memo having thereon the
official mark denoting that the cheque has been dishonored,
presume the fact of dishonor of such cheque, unless and until
same is disproved. The accused have not disputed presentation
of the cheques for collection and dishonour of the same for the
reasons stated in Ex.P 7 to 9.
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16. The accused has not disputed service of the demand notice
on accused no. 1 company. But they have disputed service of
the notice to accused no. 2 and 3. The DW1 in the cross-
examination has admitted that he is presently residing at No. 6
Mamata Farm, Gadige Main Road, Mysuru. He has admitted
that as per his Aadhar card his address is at Bangalore. The
DW2 witness of the accused has deposed that the accused no. 2
is having his house at Nagavara Palya, C.V. Raman nagar,
Bangalore. Thus the DW1 and DW2 have admitted their address
mentioned in Exhibit P10 demand notice. Therefore it is clear
that the demand notice is issued to the correct address of
accused no. 2 and 3 and they have intentionally got it returned
with endorsement unclaimed. As provided under Section 27 of
General Clauses Act, if the notice is sent to the correct address,
it is sufficient service of notice and burden is on the accused to
show that the notice is not served on him. But the accused has
not brought on record any evidence to prove that notice is not
served on them and the postal endorsement is incorrect.
Therefore, it is clear that the notice is duly served on the
accused on 26-12-2023.
17. Thus complainant has complied all the statutory
requirements for constitution of offence under Section 138 of
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C.C.No.8405/2024Negotiable Instruments Act. The accused has admitted that the
Ex.P 4 to 6 cheques were drawn from the account of the
accused no.1. It is also admitted that accused no. 2 has affixed
his signature to Ex.P 4 to 6 cheques representing the accused
no. 1 company. He has also admitted issuance of cheque to the
complainant. The service of demand notice is also established
by the complainant. Therefore the complainant has discharged
his initial burden. Therefore, the complainant is entitled for
presumption under Section 118 and 139 of Negotiable
Instrument Act. The provisions of Section 118 provides for
presumption as to negotiable Instruments which reads as
follows –
118- Presumptions as to negotiable Instruments –
Until the contrary is proved, the following
presumptions shall be made – (a) of consideration –
that every negotiable Instrument was made or drawn
for consideration, and that every such instrument,
when it has been accepted, indorsed, negotiated or
transferred, was accepted, indorsed, negotiated or
transferred, was accepted, indorsed, negotiated or
transferred for consideration; (b) as to date – that
every negotiable instrument bearing a date was made
or drawn on such date; (c) ………………
The provisions of Section 139 of Negotiable Instrument Actreads as under:-
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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.
[
18. In the decision relied by both the parties, reported in (2010)
11 SCC 411 between Rangappa V/s Sri Mohan Hon’ble
Supreme court 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 reverse onus
clauses and the defendant caused cannot be
expected to discharge an unduly high slandered or
proof.
Therefore, in view of the principles laid down in the decision the
onus is on the accused to rebut the presumption under 139 of
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C.C.No.8405/2024
19. In this case, the accused has admitted that the accused no.
2 and 3 are the directors of accused no. 1 company and the
accused no. 1 company is incorporated under Companies Act.
The accused have also admitted that they have undertaken
construction project at Mysuru. They have also admitted that
they have approached the complainant for purchase of marbles
and accordingly the complainant has supplied the marbles to the
construction site of the accused at Mysuru.
[ 20. In this case, the accused has not taken any defence while
the complainant has issued the demand notice as per Exhibit
P10. There is no written communication with the complainant by
the accused disclosing his defence at the earliest point of time. It
is also admitted fact that there is no written agreement between
the parties about the terms of transactions and mode of payment
etc. Therefore, The defence of the accused for the first time
disclosed in the cross-examination of PW1.
[[[ 21. The defence of the accused is that the marbles supplied by
the complainant are defective and substandard. The ledger’s
statement produced by the complainant as Exhibit P 3 is not
accepted, acknowledged, and concurred by the accused. The
ledger statement is not verified and authenticated by the auditor
or third party. The payment made by the accused is not
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C.C.No.8405/2024
accounted in the ledger’s statement. The complainant has not
produced the invoices, vouchers, receipts supporting Exhibit P3
ledger statement. Therefore, the ledger statement cannot be
taken into consideration as a valid document showing existence
of liability. The accused has issued the cheques Exhibit P4 to
Exhibit P6 for the purpose of security and the complainant has
misused said cheques without prior intimation to the accused
about presentation of the cheques and without any instructions
from the accused to present such cheques for collection. The
accused has also relied on the contradictions in the statements
of PW1 for rebuttal of the presumption under Section 139 of
Negotiable Instruments Act. Exhibit D1 is the reminder letter
sent by the complainant to the accused dated 29.05.2023. The
date of the cheques Exhibit P4 to Exhibit P6 mentioned in the
cheques differs from the dates mentioned in Exhibit D1.
Therefore, the case of the complainant is doubtful and it is
sufficient to create doubt about the case of the complainant. The
accused has also taken the defence that the complainant has
filed parallel proceedings before Commercial Court for recovery of
money allegedly due under the same transaction. Therefore, this
proceeding is not sustainable.
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22. Therefore, it is necessary to consider the defence taken by
the accused one after another. The primary defence of the
accused is that the marble supplied by the accused is sub-
standard and defective marbles. The PW1 has categorically
denied the suggestions of accused that the marbles supplied are
defective marbles. Nothing has been elicited from the mouth of
PW1 to substantiate the defence that the marbles supplied are
defective.
23. The accused himself examined as DW1 and in his evidence
he has stated that the complainant has supplied defective
marbles and making false claim for the amount. He has stated
that the material supplied by the complainant is used in some of
the villas of the project and the owners of the villa are now
making claim against him for using defective material in
construction. When he inquired with the complainant, they have
assured to replace the materials, but they have not replaced till
now. The DW1, to substantiate his defence, has produced the
photographs of the marbles laid in the villas as Exhibit D2 to
Exhibit D10. He has taken the contention that said photographs
are relied upon while passing the orders on application under
Section 143A of Negotiable Instruments Act and the complainant
has not objected to the said photographs at the stage of
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production and the complainant has waived his right to object.
Anything relied by the court at the time of passing interim orders
is Prima facie reliance on the face of documents and said
documents not tested in evidence by way of cross-examination.
Now said photographs are brought on record as evidence and it
is tested by cross examination. Therefore the contention of the
accused that the complainant has wived his right to object the
documents cannot be sustained.
24. The complainant has denied that said photographs are
obtained in the spot. It is suggested that said photographs are
obtained at Bangalore. It is admitted fact that in Exhibit D2 to
D10 photographs, the location is not printed. Therefore there is
no evidence to authenticate that the photographs produced by
the accused as Exhibit D2 to Exhibit D10 are of the same
marbles supplied by the complainant to the accused. Further
more by seeing the Ex. D 2 to 10 photographs no one can decide
that the marbles were defective or not. The DW2 employee of the
accused in his evidence deposed that some of the marbles
supplied by the complaint company are found as defective when
it is laid in the villas and at the time of polishing. Thus it is
admitted fact by the accused that they have laid the marbles in
the villas. The Dw 2 has also deposed that the defective marbles
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were laid in Villa no.2, 3, 12 and 47. The DW2 in the cross-
examination has deposed that the defect in the marbles is not
that of unwanted lines in the marbles, but at the time of
polishing, the marbles are chipping like sand. But to
substantiate said facts, there is no evidence brought on record
by the accused. The accused has not put such suggestions to
PW1 that marbles are found defective at the time of polishing
and it is chipping like sand. The DW1 also, in his cross-
examination, has not deposed these facts stated by DW2. Thus
for the first time in the evidence of DW2 the accused has
explained how the marbles are defective. Till the evidence of DW1
the accused has only stated that marbles are defective but how it
is defective has not been stated. The accused and DW2 have
deposed that they have visited to the place of complainant and
informed the complainant about the defective marbles. They
have also deposed that the complainant has assured that they
will replace the defective marbles. The DW2 in his cross-
examination has deposed that the accused has replaced some of
the marbles at his own cost. The purchasers are making claim
against the accused for laying defective marbles in the villa. But
to substantiate these contentions the accused has not produced
any material before this court. Whether Villa No. 2, 3, 12 and 47
to which the alleged defective marbles were laid are sold or not.
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C.C.No.8405/2024
The accused has also not produced any prima facie material to
show that the purchasers of the villa have made the claim
against the accused for laying defective marbles or such villas
were remained unsold due to laying of defective marbles.
Therefore, there is no evidence on record is placed by the
accused to show that the alleged marbles supplied by the
complainant were defective and due to the same he has suffered
any loss.
25. The accused has also admitted that he has not made any
written communication to the complainant, complaining that the
marbles supplied are defective or it is found defective at the time
of polishing. Even when the demand notice is served on the
accused no. 1, the accused has not taken this defence and
issued any reply. The accused has also not taken any legal
action against the complainant for supplying defective marbles
before any of authorities under law.
26. In the cross-examination of PW1, the accused has asked
with the PW1 about the process held in mediation proceedings
before DLSA and he has also questioned PW1 about the visit to
the construction site of the accused during the process of
mediation and about the Inspection report of the mediator and
also about the acknowledgment of the complainant to replace the
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defective marbles. In this regard, the complainant has relied on
the order of Hon’ble 60th Additional City Civil and Sessions
Judge, Bangalore in Criminal Revision petition 231/2025 dated
23.12.2025, wherein, the complainant has challenged the order
passed by this Court under Section 143A of Negotiable
Instruments Act. In the said decision, it is observed that the
proceedings before mediation cannot be relied upon as it is
against the confidentiality shield provided under mediation
proceedings. Therefore this portion of cross-examination by the
accused, cannot be looked into.
27. Therefore, upon considering above discussion, this Court is
of the considered view that the defence taken by the accused
that the complainant has supplied defective marbles is not
established by the accused with probable evidence. The evidence
placed by the accused such as the photographs does not prove
that the marbles supplied by the complainant are defective. The
evidence of DW1 and DW2 is their self-serving statements. The
oral evidence of DW 1 and 2 is not supported with documentary
evidence or by admissions of PW1. The PW1 has specifically
denied that the marbles supplied to the accused were defective.
The accused has not taken any positive steps by issuing notice
or by taking any action against the complainant for supply of
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defective marbles at the initial stage which is expected from a
prudent man. Therefore, this defence of the accused cannot be
considered as a probable defence for rebuttal of the presumption
under Section 139 of Negotiable Instruments Act.
28. Another defence taken by the accused is that the
complainant has not produced the invoice, voucher and receipts
in respect of the marbles supplied to the accused. The
complainant has also not produced authenticated,
acknowledged, recognized and mutually agreed statement of
accounts before this Court. The Exhibit P3 statement of
accounts produced by the complainant is not acknowledged,
authenticated or concurred by the accused. Therefore, the said
statement of account cannot be taken into consideration for
proving existence of legally recoverable debt. The PW1 has also
admitted that there is no document to show that the accused
has accepted the statement of accounts or concurred with the
statement of accounts produced as Exhibit P3. The accused has
also made the suggestion to PW1 that the payments made by the
accused is not reflected in Exhibit P3. The DW1 in his evidence
also deposed that Exhibit P3 statement of accounts is not
accepted by him. Therefore, there is no document to show
existence of legally recoverable debt payable by the accused to
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the complainant. Learned counsel for the complainant during
the course of arguments has submitted that the accused has
admitted purchase of marbles from the complainant. He has also
admitted supply of marbles by the complainant to the accused at
the spot of the construction. The accused is also a company
registered under Companies Act and it is bound to maintain
accounts in respect of its transactions. He has submitted that
there is no acknowledgment of the outstanding amount by the
accused. But the accused has not brought on record any
evidence to show how the statement of accounts is not correct.
The accused has not disputed any specific entry in Exhibit P3
statement of accounts. The accused has not taken any specific
stand that any of the invoices referred in Exhibit P3 is not
delivered to him or not raised against the accused. He has also
not brought on any record to doubt the credit and debit entry in
the statement of accounts. Thus to doubt the entries in Exhibit
P3 statement of accounts the accused has not brought any
record before this court. Having appreciated the evidence on
record, the accused has only denied that statement of accounts
Exhibit P3 as it is not correct. He has also contented that the
accused has not accepted, acknowledged or concurred with the
statement of accounts produced by the complainant. But as
submitted by the learned counsel for the complainant, the
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accused has not disputed any of the entries made in the Exhibit
P3 statement of accounts. He has not disputed any of the
invoices referred in Exhibit P3. He has not disputed any specific
amount made on specific date is not reflected in Exhibit P3
statement of accounts. Therefore mere denial of the statement of
accounts is not sufficient to doubt the correctness of Exhibit P3
statement of accounts. The accused being the company
incorporated under the Companies Act and having responsibility
of maintaining the accounts for its transactions has not
produced any material before this court contrary to the
statement of account produced by the complainant. Therefore,
the contention of the accused that Statement of Accounts
Exhibit P3 cannot be relied upon cannot be accepted. The
accused has not brought on record any probable evidence to
doubt the correctness of entries in Ex.P 3 ledger account.
29. Another set of defence of the accused is that in Exhibit D1,
reminder letter issued by the complainant to the accused has
mentioned different cheque dates. The Exhibit P4 is bearing
Cheque No.742094 dated 01.12.2023 for a sum of ₹
12,55,086/-. But in Exhibit D1 the complainant has stated the
date of the cheque as 31.05.2023. Exhibit P5 is the cheque
bearing number 742252 for a sum of ₹ 11,00,000/- dated
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05.12.2023. But in Exhibit D1 it is stated that said cheque is
due in the month of June 2023. Exhibit D6 cheque is bearing
number 742253 for a sum of ₹ 12,00,000/- dated 05.12.2023.
But in Exhibit D1, it is stated that said cheque is due in the
month of June 2023. The PW1 in the cross-examination has
admitted issuance of Exhibit D1 letter to the accused from the
complainant company. He has also admitted contents of the said
letter. With regard to the discrepancy about the date of the
cheque, he has stated that due to typographical error, the date is
wrongly mentioned in the letter. In the cross examination, he has
admitted that they are bound by Exhibit D1 letter issued to the
accused. The learned counsel for the complainant during the
course of arguments has admitted that it is true that the date
mentioned in Exhibit D1 letter with reference to Exhibit P4 to
Exhibit P6 cheques is different. But PW1 has deposed that the
said mistake is due to typographical error. Learned counsel for
the complainant has submitted that in Exhibit P4 to Exhibit P6
cheques there is no overwriting, there is no correction of date. It
is not the case of the accused that the cheques are altered by the
complainant. Complainant has also submitted that this letter is
produced by the complainant himself before the Commercial
Court in a commercial suit filed against the accused.
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30. Now it is proper to consider whether this letter will
sufficient to create reasonable doubt about the truthfulness of
the case pleaded by the complainant and issuance of cheques
by the accused towards repayment of existing legally recoverable
debt and about existence of legally recoverable debt. On perusal
of Exhibit P4 to Exhibit P6 cheques, there is no alteration in the
cheques. There is no overriding of the date in the cheques. It is
not the case of the accused that the cheques are altered. The
accused has taken the defence that he has issued Exhibit P4 to
Exhibit P6 cheques for the purpose of security. Nowhere in the
cross-examination of PW1 or in the evidence of the accused as
DW1, he has not denied the contents of the cheques. The
accused has not taken any contention that he has issued blank
signed cheque to the complainant and the complainant himself
filled the contents of the cheque. In the cross-examination of
PW1, the accused even not made any suggestion to PW1
denying issuance of cheques towards repayment of existing
debt. No suggestion is made to PW1 that cheques are issued for
the purpose of security. It is only in the evidence of the accused
as DW1, for the first time, the accused has taken the contention
that the cheques are issued for the purpose of security. In the
evidence, the accused has only stated that Exhibit P4 to Exhibit
P6 are issued to the complainant towards security deposit and
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not for encashment. Thus the accused has not denied the
contents of Exhibit P4 to Exhibit P6 cheques and he has not
denied issuance of cheques to the complainant. For these
reasons, the contention of the accused that cheques are issued
for the purpose of security and not for the purpose of
encashment cannot be accepted, As there is no correction or
overriding or alteration in the date of the cheques, only for the
reason that in Exhibit D1 reminder letter the date of the cheque
is wrongly mentioned, will not create a doubt about issuance of
the said chequex or will not create a doubt about the existence
of debt.
31. The accused has also taken the contention that there is
discrepancy in the outstanding amount mentioned in Exhibit P3
statement of accounts and Exhibit D1 reminder letter. In
Exhibit D1 reminder letter the outstanding amount is
mentioned as ₹ 95,83,639/- on 29.05.2023. But in Exhibit P3,
the outstanding amount is mentioned as ₹ 85,11,631/-. For this
PW1 has stated that after Exhibit D1 letter on 14.07.2023 the
accused has made payment of ₹ 10,00,000/-. Therefore there is
discrepancy in the outstanding amount. It is pertinent to note
that in this case the cheque amount is for ₹ 35,55,086/-.
Therefore the court is required to consider whether there is
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outstanding legally recoverable debt to the extent of the cheque
amount. Considering Exhibit P3 and Exhibit D1, the
outstanding amount is much more than the cheque amount.
Therefore, minor discrepancy in the amount mentioned in the
statement of accounts and Exhibit D1 letter will not create a
reasonable doubt about the existence of the outstanding
amount to the extent of the cheque amount. The court is not
concerned about other dues under the statement of accounts
than the amount covered under the cheque.
32. Learned counsel for the accused during the course of
arguments has relied on the decision of Hon’ble Supreme Court
in Dashrathbhai v. Hitesh Mahendrabhai Patel reported in 2022
Live law SC 830, Indus Airways Pvt. Ltd. v. Magnum Aviation
Pvt. Ltd. reported in 2014 12 SCC 539, Kumar Exports v.
Sharma Carpets reported in 2009 2 SCC 513, Bir Singh v.
Mukesh Kumar reported in 2019 4 SCC 197, Basalingappa v.
Modi Basappa reported in 2019 5 SCC 418, Shivamoorthy v.
Amruthraj reported in ILR 2008 Karnataka 4629, Vardhineedi,
Shi Ramanjanelu v. Yeeda Sasibhushan and another reported in
2025 SCC Online AP 1801, Rangappa v. Mohan reported in 2010
11 SCC 441, Ashok Gaur v. State of NCT of Delhi in Criminal
Appeal No. 560 bar 2020 of Hon’ble High Court of Delhi, Sujal
31
C.C.No.8405/2024
Guha v. Amal Krishna Paul in C.R.A.741 by 2012 of Hon’ble
High Court of Calcutta, N Vijay Kumar v. Vishwanath Rao in
Criminal Appeal No. 5305 by 2024 of Hon’ble Supreme Court.
Learned counsel for the complaint has relied on the decision of
Hon’ble Supreme Court in Sreepathi Singh since deceased
through his son Gaurav Singh v. State of Jharkhand and
Another reported in 2022 18 SCC 614. Kalamani tex and
another v. P. Balasubramanian reported in 2021 5 SCC 283. I
have gone through the principles laid down in all these decisions
and taken into consideration while appreciating the evidence on
record.
33. Therefore, upon considering entire evidence on record, this
Court is of the considered view that the defence taken by the
accused is not established before this Court with probable
evidence by applying the principles of preponderance of
probabilities. Till the accused is able to rebut the presumption
under law, the complainant cannot be expected to prove
existence of legally recoverable debt by producing cogent
evidence such as invoices, receipts and vouchers. The
presumption under Section 139 of NI Act is statutory
presumption and the court is bound to consider the
presumption in favour of the complainant. Only when the
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accused is able to rebut the presumption by producing probable
evidence, then only the complainant is expected to prove the
existence of legally recoverable debt by producing cogent and
convincing evidence beyond reasonable doubt. As discussed
above, in this case, the defence taken by the accused does not
inspire the confidence of the court to that of a prudent man,
that existence of debt is not probable. Therefore this Court
concludes that the accused has failed to report the presumption
under Section 118 and 139 of Negotiable Instruments Act.
Therefore the complainant with the aid of the presumption
under Section 139 of Negotiable Instruments Act proved
existence of legally recoverable debt and issuance of cheque in
question towards discharge of said debt. Therefore the
complaint is entitled for the relief claimed and the accused is
liable for conviction. Therefore this Court answers the above
point number 1 in the affirmative.
34. 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 138 of
Negotiable Instruments Act. The Amount covered under the
cheques is ₹ 35,55,086/-. The cheques issued by the accused
are dated 01.12.2023 and 05.12.2023. The money involved in
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the case is used in commercial transactions. Therefore, the fine
amount is calculated for a sum of ₹.43,11,655/-
35. The Ho’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
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
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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.
In view of the directions 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 U/sec.255(2) of Cr.P.C.,
the accused Nos.1 to 3 are convicted for the offence punishable
under Section 138 of Negotiable Instrument Act and he is
sentenced to pay a fine of ₹.43,11,655/- (Rupees Forty Three
Lakhs Eleven Thousand Six Hundred and Fifty Five Only) with
in a month and in default, pay interest at the rate of 9% from
this day till payment of fine amount, and in default to pay the
fine, the accused No.2 and 3 shall undergo simple
imprisonment of one year.
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C.C.No.8405/2024
Further acting U/s 357(1)(a) of Cr.P.C. out of the fine
amount a sum of ₹.10,000/-(Rupees Ten Thousand only) shall
be defrayed as prosecution expenses to the state.
Further acting U/s 357(1)(b) of Cr.P.C. a sum of
₹.43,01,655/- (Rupees Forty Three Lakhs One Thousand Six
Hundred and Fifty Five Only) and interest out of the fine
amount on recovery shall be paid as compensation to the
complainant.
Supply free copy of the judgment to the accused.
(Partly dictated to the Stenographer directly on the computer, typed by her,
partially dictated to Adalath Ai computer application, transcribed by it,
corrected and signed then pronounced by me in the open court on this the
6th day of April 2026).
(GOKULA.K)
XXV A.C.J.M., BANGALORE CITY.
ANNEXURE
LIST OF WITNESSES EXAMINED FOR THE COMPLAINANT:
PW.1 : Pradeep Sodani
LIST OF DOCUMENTS MARKED FOR THE COMPLAINANT:
Ex.P1 : Web Copy of the Certificate of
Incorporation
Ex.P2 : Board Resolution
Ex.P3 : Web Copy of ledger account
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C.C.No.8405/2024
Ex.P4-6 : Cheques
Ex.P7-9 : Bank Endorsements
Ex.P10 : Office copy of Legal Notice.
Ex.P11 : Postal receipts
Ex.P12 : Postal acknowledgment
Ex.P13-17 : Postal envelopes
LIST OF WITNESSES EXAMINED FOR THE ACCUSED:
DW.1 : K.Srinivasan
DW.2 : Ninad.P.K.
LIST OF DOCUMENTS MARKED FOR THE ACCUSED:
Ex.D1 : Xerox copies of email communication and
letter
Ex.D2-D10 : Photographs
(GOKULA.K.)
XXV A.C.J.M., BANGALORE CITY.