TMI Blog2021 (1) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... conclusion of the Trial Court is that the complainant ought to have approached the Civil Court is erroneous and there is a clause in the agreement itself in the event of failure on the part of the first party to perform this agreement he shall refund the advance amount. The other reason given by the Trial Court is that the cheques are issued towards security is also not based on any record - First of all, the accused has not given any reply to the notice and also he did not dispute the issuance of notice. When such being the case, it is mandate on the part of the Trial Court to draw the presumption under Section 139 of the NI Act. Apart from that, the accused counsel himself suggested that the agreement was cancelled. When the same was cancelled, question of enforcing the agreement does not arise. Having perused the reasoning of the The Trial Court that the same is a civil remedy and cheques might have issued for security is erroneous and the very approach of the Trial Court is not in consonance with the provisions of Section 138 of the NI Act and so also not under Section 139 of the NI Act and not drawn presumption. The Trial judge has committed an error in paragraph No.10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut 1000 acres of land to complainant in various survey numbers of Kamenahalli, Thindlu and Devanahalli villages, Devanahalli, Bengaluru Rural District, for the purpose of formation of layouts and construction of villas. In pursuance of the said MOU, the complainant gave ₹ 50,00,000/- in cash, ₹ 1 Crore by way cheque dated 09.10.2006, which was encashed by the accused. The complainant also gave further sum of ₹ 5,00,000/- on 27.07.2007 to the accused. In all, the complainant paid ₹ 1,55,00,000/- to the accused. After receiving the said amount, accused failed to secure lands as contemplated in the MOU. As such, accused was liable to return the amount to a tune of ₹ 1,55,00,000/- within one week after one month from the date of MOU. Towards discharge of said liability, accused issued five cheques to the complainant on different dates and when the cheques were presented by the complainant dishonoured with an endorsement Insufficient Funds . Notice was caused against the accused and when the accused failed to repay the cheque amount, the complainant was forced to file four complaints against the accused. The accused was secured in all the cases and he did ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of cheque. When such being the case, the trial Judge ought not to have acquitted the accused.i 9. The learned counsel relied upon the Judgment in the case of Ripudaman Singh v. Balkrishna reported in (2019) 4 Supreme Court Cases 767, would submit that, when the cheques are issued in pursuance of agreement to sell, the Apex Court held that qualify as being towards legally enforceable debt or liability and amenable for prosecution under Section 138 of the Negotiable Instruments Act, 1881 ('NI Act' for short) in case of dishonour. Further held that, though agreement to sell does not create interest in immovable property, however it constitutes enforceable contract between parties. Any payment made in pursuance of such agreement is duly enforceable debt or liability for purpose of Section 138 of the NI Act. 10. The learned counsel relied upon the Judgment in the case of Rangappa v. Mohan reported in AIR 2010 Supreme Court 1898, the Apex Court held that, existence of legally recoverable debt or liability in the matter of presumption under Section 139 of the NI Act. Further, the learned counsel would submit that the accused did not dispute the issuance of cheque and also ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the material available on record, the points that would arise for consideration of this Court are:- (1) Whether the Trial Court has committed an error in acquitting the accused in C.C.No.1761/2009, C.C.No.1763/2009, C.C.No.5682/2008 and C.C.No.8513/2008, respectively, for the offence punishable under Section 138 of the NI Act and it requires an interference of this Court? (2) What order? Point Nos.(1) and (2): 16. Before considering the grounds urged in the appeal and also the respective submissions, this Court would like to refer to the evidence available on record since this Court is having the jurisdiction to re-appreciate the evidence available on record. The complainant in his evidence, he reiterated the complaint averments with regard to the transaction taken place in between them particularly, the MOU and also relied upon the other documents. P.W.1 was subjected to cross-examination. 17. On perusal of the Order Sheet before commencement of cross-examination both the respective Counsel made the submission that common evidence by clubbing of the cases can be done. Hence, all the cases are clubbed together and common cross-examination was done. He admits t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wn in para No.5 of MOU. But he claims he paid ₹ 50,00,000/- on 26.09.2006 by cash and an endorsement was taken on the said MOU for payment of the said amount. It is suggested that whether he has issued any notice pertaining to non-performing MOU and he replies that he orally informed. He admits that he has received ₹ 5,00,000/- from Bangalore City Police Housing Co-operative Society Limited. The agreement between himself and the said Society came to be cancelled within 6 to 8 months. It is elicited that he does not know whether the accused had purchased property from agriculturist pertaining to layout to be formed for the said Society. It is suggested that he has mis-used the cheques of accused for wrongful gain and the said suggestion was denied. It is suggested that he kept blank signed cheques of the accused at the time of execution of above said MOU dated 25.09.2006 as security and the said suggestion was denied. 18. I have already pointed out that the accused not led any evidence before the Trial Court. Having perused the evidence available on record issuance of cheque is not in dispute and also notice has been given to the accused is also not in dispute. There ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this agreement he shall refund the advance amount. The other reason given by the Trial Court is that the cheques are issued towards security is also not based on any record. First of all, the accused has not given any reply to the notice and also he did not dispute the issuance of notice. When such being the case, it is mandate on the part of the Trial Court to draw the presumption under Section 139 of the NI Act. Apart from that, the accused counsel himself suggested that the agreement was cancelled. When the same was cancelled, question of enforcing the agreement does not arise. 20. The Trial Court relying upon the Judgment in the case of M/s.Q-Soft System Solutions (P) Ltd., v. H.N.Giridhar reported in ILR 2008 KAR 643, came to the conclusion that if contract is broken or agreement is broken, only course opens to aggrieved party is to resort to Civil Court so as to approach his grievances. If cheque is bounced would amount to a pure Civil Transaction under Section 138 of the NI Act could not be attracted. The Trial Court has not distinguished the Judgment since in the case on hand agreement itself is cancelled. 21. The Trial Judge also discussed in paragraph No.9 in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ult, the amount has to be refunded. When the complainant specifically pleaded that those cheques are issued for refund of the amount for which he has received when he has not given any reply to the notice and when he has not disputed the signature of the cheque, the Trial Judge ought to have drawn the presumption under Section 139 of the NI Act. The Judgment of Rangappa's case (supra), is aptly applicable to the case on hand. The approach of the Trial Court is that the remedy of the complainant is Civil remedy is also erroneous. The Judgment of the Apex Court in Ripudaman Singh's case referred (supra), is aptly applicable to the case on hand. The Apex Court held that, in case of an agreement between the parties and also if any payment has been made categorically held that it constitutes enforceable contract between parties and if any payment is made in pursuance of such agreement is duly enforceable debt or liability for purpose of Section 138 of the NI Act. The very reasoning assigned by the Trial Court is erroneous. 22. The Apex Court also in the Judgment reported in Hiten P. Dalal's case (supra), has categorically held that mere taking the defense is not enough, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said contention of the accused counsel cannot be accepted when an opportunity is given to him to adduce the evidence and he did not choose to lead evidence and apart from that even then he has received the notice also and he has not given any reply and the defense which he has taken appears to be an after thought. Hence, on the ground of not adducing the evidence before the Trial Court cannot be a ground to remand the matter for fresh consideration. 27. In view of the discussions made above, I proceed to pass the following: ORDER (i) The appeals are allowed. (ii) The impugned Judgments of acquittal dated 03.11.2010 passed in C.C.No.1761/2009, C.C.No.1763/2009, C.C.No.5682/2008 and C.C.No.8513/2008, respectively, on the file of XII Additional Chief Metropolitan Magistrate at Bengaluru, are hereby set aside. (iii) The accused is convicted for the offence punishable under Section 138 of the NI Act. (iv) The accused is directed to pay the amount of ₹ 1,55,00,000/- to the complainant within eight weeks from today and in default of the payment of the amount, the accused shall undergo Simple Imprisonment for a period of two years. (v) The Trial Court is directe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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