Criminal Appeal No. 830 of 2019 · The High Court
Case Details
- 1 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 28TH DAY OF MARCH, 2025 BEFORE THE HON'BLE MR JUSTICE RAMACHANDRA D. HUDDAR CRIMINAL APPEAL NO. 830 OF 2019 (A) BETWEEN: MISS. SHWETHA G D/O SRI. GANGADHARA M AGED ABOUT 30 YEARS RESIDENT AT NO.67, 1ST FLOOR 9TH CROSS, 5TH MAIN ROAD RAMANCHANDRA AGRAHARA CHAMARAJPET BENGALURU-560 018 (BY SRI. L. SRINIVASA BABU, ADVOCATE) …APPELLANT AND: SRI. DEVARAJ K S/O SRI. KRISHNANA AGED ABOUT 37 YEARS MELSTAR HEALTH CARE NO.850, 1ST FLOOR 1ST MAIN, CONTOUR ROAD GOKULAM 3RD STAGE MYSURU-570 002. Digitally signed by SHAKAMBARI Location: High Court of Karnataka …RESPONDENT (BY SRI. K.M. THIRTHAPPA, ADVOCATE) THIS CRL.A. IS FILED U/S.378(4) OF CR.P.C PRAYING TO SET ASIDE THE JUDGMENT AND ORDER OF ACQUITTAL DATED 27.03.2019 PASSED BY THE XVI ADDL.C.M.M., BENGALURU IN C.C.NO.5838/2018 - ACQUITTING THE RESPONDENT/ACCUSED FOR THE OFFENCE P/U/S 138 OF N.I. ACT. - 2 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 THIS APPEAL, COMING ON FOR ADMISSION, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE RAMACHANDRA D. HUDDAR ORAL JUDGMENT This appeal is directed against the judgment of acquittal dated 27.03.2019 passed in C.C.No.5838/2018 by the XVI Additional Chief Metropolitan Magistrate, Bengaluru City, acquitting the accused for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short, "N.I. Act"). 2. Parties to this appeal are referred to as per their rank before the Trial Court. Factual matrix of the case: 3. The complainant, Miss.Shwetha G., filed a complaint before the Trial Court alleging that, she and the accused were well acquainted with each other through her common friend. Considering the request of the accused, she arranged and paid a sum of Rs.9,24,000/- on different dates between April 2014 and 2017. She made the said - 3 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 financial arrangement by way of Green Remit Card (GRC), so also by way of cash. It is her case that, accused promised her to repay the same at the earliest point of time. It is further stated that, accused is a D-Pharma holder and after sustaining loss in his business, he worked as an employee under "Melden Pharmaceuticals Pvt., Ltd.," from April 2016 to March 2017. In the said Company complainant was a Director and share holder of the Company. After the accused quit his job from the said Pharmaceuticals Company, he didn't come forward to repay the loan amount borrowed from the complainant. Because of continuous requests and demands made by the complainant, accused issued cheques dated 29.12.2017 for a sum of Rs.7,00,000/- and Rs.2,24,000/- on 10.01.2018 drawn on State Bank of India, Yadavagiri Branch, Mysore. Believing the promise and assurance of the accused, complainant presented a cheque for Rs.7,00,000/- dated 29.12.2017 for encashment, but it was dishonoured with an endorsement as "Payment stopped by the drawer". She also presented another - 4 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 cheque for a sum of Rs.2,24,000/- on 10.01.2018, which also was dishonoured with the same endorsement. 4. It is her further case that, as the said cheques were dishonoured within the time stipulated under the provisions of N.I. Act, she issued legal notice on 20.01.2018 by way of Registered Post with Acknowledgment Due, Speed Post and Courier, calling upon the accused to pay the cheque amount within 15 days. Despite service of notice, he did not pay the amount. He issued a false reply dated 29.01.2018.
Facts
Therefore, the complainant filed a complaint under Section 200 of Cr.P.C and filed an affidavit to that effect. After registering the private complaint, her sworn statement was recorded and process came to be issued by registering the criminal case against the accused for the offence punishable under Section 138 of the N.I. Act. As it is a summons trial, complainant relied upon her sworn statement and got marked Exs.P1 to P9 in her favour and closed complainant's evidence. Thereafter, accused was - 5 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 questioned under Section 313 of Cr.P.C, so as to enable him to answer the incriminating circumstances appearing in the evidence of the complainant. He denied his complicity in the crime and chose to lead his defence evidence. To disprove the case of the complainant, he also entered the witness box as DW.1, and during the course of cross-examination on behalf of the defence Ex.D1 came to be marked, so also Ex.N1. 5. The learned Trial Court on hearing the arguments and on evaluation of the evidence placed on record by both sides, found the accused not guilty of committing the offence under Section 138 of the N.I. Act and acquitted the accused for the said offence. Being aggrieved by the same, now the complainant is before this Court challenging the impugned judgment of acquittal of the accused. 6. Learned counsel for the complainant, with all vehemence submits that, signature on the cheques and issuance of the cheques by the accused are admitted. So - 6 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 also when the said cheques were presented, they were dishonoured. When the accused was in need of money, periodically the complainant paid money to the extent of Rs.9,24,000/- as there was assurance by the accused to repay the amount at the earliest point of time. When there were repeated requests by the complainant, the said impugned cheques were issued by the accused, but they were dishonoured. In support of his submission, the
Legal Reasoning
features coupled with the position of law are put together, there is no merit in this appeal and appeal fails. - 24 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 Accordingly, the point raised supra is answered in the negative. 24. Resultantly, I pass the following:
Arguments
learned counsel for the complainant places reliance on the documentary evidence produced on behalf of the complainant, as well as the evidence placed on record by both sides. 7. His submission is that, the learned Trial Court has wrongly put burden on the complainant, that the complainant has not proved the legally enforceable debt, so also the presumption which was very much available has been favoured in favour of the accused. He would submit that, wrongly, it is held that, the accused has rebutted the said presumption. It is his submission that, - 7 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 in view of the wrong application of the law by the Trial Court, as well as illogical reasons assigned by the Trial Court, and the grounds urged in the appeal memo, do establish the error committed by the Trial Court in commencing the wrong conclusion. Therefore, he prays to allow the appeal and set aside the impugned judgment. 8. As against this submission, Sri. K.M.Thirthappa, the learned counsel for the accused, refuting all these submissions submits that, when a presumption is very much available to the complainant as well as the accused, the heavy burden is on the complainant to prove her case with legal evidence. The presumption which is available is not only under the provision of Section 118 of N.I. Act but also under the provision of Section 139 of N.I. Act. This presumption is a rebuttable presumption. By adducing rebuttable evidence, and by relying upon admission of PW.1, he submits that, whatever the presumption which was available under the aforesaid provisions has been rebutted by the accused. - 8 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 With logical reason, the learned Trial Court has come to the conclusion that, the complainant has failed to prove her case with legal evidence. There was no occasion for the accused to raise any loan from the complainant as alleged by her. Initially, he was an employee of the 'Pharmaceutical Company' and he became the partner of the Company and he, being a D-Pharma holder, a well- qualified person, would not have raised a loan from the complainant in the manner alleged by her. In support of his submission, he too relies upon the evidence placed on record by both the side, as well as the finding of the Trial Court. He prays to dismiss this appeal. 9. I have given my anxious consideration to the arguments of both sides. Perused the records. 10. In view of the rival submissions of both sides, the point that would arise for my consideration is: "Whether the Trial Court has committed any illegality or infirmity in passing the - 9 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 impugned judgment of acquittal of the accused?" 11. My answer to the above point is in the negative for the following reasons: It is a case registered under the provision of Section 138 of the N.I. Act. That means the complainant alleges that, in discharge of the legally enforceable debt to the extent of Rs.9,24,000/-, accused issued two cheques, but when they were presented, they were dishonoured, as there was a direction by the accused to stop the payment. Therefore, it is alleged that accused has prima facie committed the offence under Section 138 of the N.I. Act. 12. To prove the said offence under Section 138 of the N.I. Act, it is mandatory on the part of the complainant to prove the ingredients of the said offence. They are: (i) Drawing up of a cheque by the accused towards payment of an amount of money, - 10 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 for the discharge, in whole or in part, of any debt or any other liability; (ii) Return of the cheque by the Bank as unpaid; (iii) The drawer of the cheque fails to make the payment of the said amount of money within 15 days of the receipt of the notice under the proviso (b) to Section138 of the N.I. Act If one reads the explanation to this Section, it provides that "Debt or the other liability" for the purpose of this Section means, a legally enforceable debt or other liability. 13. The undisputed facts are: cheques belong to the accused is admitted, so also his signature on the same. So also the said cheques were dishonoured. It is the fact admitted that, the complainant issued the legal notice within the time stipulated under the provisions of the N.I. Act and it was replied by the accused. - 11 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 14. Now, it is the duty of the complainant to prove that, the said cheques were issued to pay the debt or other liability. When a cheque is issued, a presumption comes into operation under Section 118 of the N.I. Act, so also under the provisions of Section 139 of the N.I. Act. These two Sections read as under: "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 for consideration; (b) as to date —that every negotiable instrument bearing a date was made or drawn on such date; (c) as to time of acceptance —that every accepted bill of exchange was accepted within a reasonable time after its date and before its maturity; - 12 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 (d) as to time of transfer —that every transfer of a negotiable instrument was made before its maturity; (e) as to order of endorsements —that the endorsements appearing upon a negotiable instrument were made in the order in which they appear thereon; (f) as to stamps —that a lost promissory note, bill of exchange or cheque was duly stamped; (g) that holder is a holder in due course — that the holder of a negotiable instrument is a holder in due course: Provided that, where the instrument has been obtained from its lawful owner, or from any person in lawful custody thereof, by means of an offence or fraud, or has been obtained from the maker or acceptor thereof by means of an offence or fraud, or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him. 139. Presumption in favour of holder.— It shall 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 - 13 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 discharge, in whole or in part, of any debt or other liability." 15. As per the provisions of the N.I. Act, supra, presumption is always in favour of the complainant. Initial burden is purely on the complainant, that those cheques were issued in discharge of legally enforceable debt. 16. To prove the said fact, PW.1 has come before the Trial Court to speak that, it was accused who issued the said cheques in discharge of the legally enforceable debt. PW.1 relies upon various documents marked as Exs.P1 to P9. She has been thoroughly cross-examined by the defence. She admits that, she has studied Diploma and she owns a Company by name 'Meldon Pharmaceuticals Private Limited'. Further, she states that, accused was introduced to her by their common friend by the name Sanjay. According to her, she appointed the accused in her Company in the month of April, 2016, and she used to pay a salary of Rs.30,000/- p.m through Bank. In the month of March, 2017, accused quit complainant's - 14 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 Company. She lent loan to the accused through cash, through account transfer and through Green Remit Card (GRC) of SBI. According to her, she lent a sum of Rs.1,00,000/- to the accused by way of cash on 13th or 14th September 2014, Rs.25,000/- by way of cash in the month of August 2014 and Rs.50,000/- in the month of May 2016. As observed by the Trial Court, though the complainant alleges that, she had lent a loan of Rs.9,24,000/-, if the amounts stated supra are added, the total amount would be Rs.1,75,000/-. She has deposed that, she does not remember about other two cash transactions with the accused. Further, she states that, other than these transactions, she has lent the remaining loan amount to the accused through Bank transfer. But, she has not produced any such Bank statement before the Court to prove that, she has really transferred the loan amount to the accused. She has not declared the said loan amount in her income tax returns, as per her own evidence. She states that, in the said cheques, her name is appearing. It is the defence of the accused that, this - 15 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 complainant has forcibly taken the 'Bullet vehicle' of the accused towards the alleged liability. According to her answer, accused had issued a cheque for Rs.1,00,000/- and the said cheque was dishonoured. She further states that, accused voluntarily gave his 'Bullet vehicle' to her. She denied a suggestion that, she had threatened the accused to lodge a complaint against him and she tried to blackmail him. She denied a suggestion that, on the date of the agreement between her and the accused, accused had issued the cheque to her, for the purpose of security. It is the defence of the accused that, complainant had taken the blank signed cheques at the time of agreement and they have been misused. Thereby accused admits his signature on the cheques. 17. It is her further evidence that, she got transferred the 'Bullet Motorbike' in her name and she does not know the market price of the said bike. She further denied suggestion that, the original documents concerning the said bike are with her, which were sent to - 16 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 her through courier on 13.09.2017. Further, she states that, Ex.N1, a document pertaining to the said vehicle, is with her and identified the 'B-register' extract confronted to her, which was downloaded from the internet. There was no compliance of the Section 65-B of the Evidence Act to prove the content of the said document. She denied a suggestion that, she had just transferred a sum of Rs.2,21,150/- to the account of the accused from 29.05.2014 to 12.04.2016. That means, she had already taken the Bullet Motorbike from the accused and towards the purchase of the said Bullet Motorbike, she has not paid the amount, but relied upon the amount being transferred in between 29.05.2014 to 12.04.2016 to the extent of Rs.2,21,150/-. A question was posed to the complainant that, accused has transferred a sum of Rs.1,63,900/- to the account of the complainant in between 27.06.2014 and 14.12.2017. She answered this question stating that, transfer of the said amount was in respect of different transactions. To prove the said fact, except the self serving testimony of PW.1, there is no evidence placed on - 17 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 record. Another question was directed to her stating that, towards the 'Enfield Motorbike', Rs.1,80,000/- was transferred, but again she says that, it is a different transaction. She denied a suggestion that, she had no financial source or any job to earn the amount as stated by her. To show that, she had financial capacity to lend a loan of Rs.9,24,000/-, except herself say in her complaint as well as in the examination-in-chief, there is no evidence placed on record. 18. To rebut the evidence of the complainant, accused himself has entered into the witness box and has stated that, there was no occasion for him to seek a loan from the complainant. He entered into agreement of partnership with the complainant. There was agreement that, he had to contribute Rs.6,00,000/- towards the business. Even complainant had agreed that, she would contribute for the accused towards the said partnership firm. It is his evidence that, complainant took six blank cheques as a security bearing cheque Nos.266889 to - 18 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 266894. The complainant has not whispered anything about this fact. Just she has presented two cheques and filed a case against the accused, alleging that, accused has committed the offence under Section 138 of the N.I. Act. According to accused evidence, because of difference of opinion between the complainant and himself, he resigned from the said partnership firm and requested the complainant to return his cheques. Then, he came to know that, on 24.10.2017, the complainant presented a cheque for Rs.1,00,000/- to the Bank and it was dishonoured. Remaining five cheques were still with the complainant. Therefore, he directed the Bank to 'stop the payment'. This fact is not specifically denied by the complainant in the cross-examination. There is no whisper with regard to the receiving of the said cheques by the complainant from the accused towards legally enforceable debt. 19. Though this DW.1 has been cross-examined, he has withstood the test of cross-examination. It is - 19 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 elicited that, he has knowledge with regard to the Bank transactions and he has not stated anything about the amount due to the complainant etc, in his cross- examination. When the heavy burden is on the complainant to prove that, there was 'legally enforceable debt' and towards the discharge of the said loan amount, the accused has issued the cheques, this burden of proof has to be discharged by the complainant with legal evidence. All the suggestions with regard to raising of loan by the accused are denied by him. Even the documentary evidence so produced by the complainant do not establish that, it was a legally enforceable debt in the manner stated in the complaint. 20. The learned Trial Court by relying upon the evidence placed on record by both sides, has come to the definite conclusion that, though this PW.1 initially denied that, accused had sent all the original documents concerning his 'Enfield motorbike' to her, but she categorically states that, she has got transferred the said - 20 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 bike in her name. It shows that, she got transferred the said bike in her name and she never says that, she really lent that much of loan, i.e., Rs.9,24,000/-, to the accused in the manner stated in the complaint. Further, it is the defence of the accused that, there was no legally enforceable debt. As rightly observed by the Trial Court, in view of the evidence of complainant, in all, she has transferred Rs.2,21,150/- to the account of the accused in between 29.05.2014 and 12.04.2016. She admits that towards the repayment of the loan amount, accused has transferred a sum of Rs.1,63,900/- from his account to the complainant's account between 27.06.2014 and 14.12.2017. So also gave his Bullet Motorbike worth Rs.1,80,000/-. If all this amount is added together, it will not reach Rs.9,24,000/-. It is nearly Rs.2,21,150/-. If that is so, the defence of the accused, as rightly observed by the Trial Court, there is no evidence placed on record by the complainant that, she really has advanced an amount of Rs.9,24,000/- periodically to the accused to - 21 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 meet his exigencies. No such evidence is placed on record. 21. Ex.P10 was the original cheque, which was presented initially by the complainant, but it was dishonoured as “funds insufficient” as per the endorsement at Ex.P11. But now she has come up with a claim that, said cheque was dishonoured and to that effect, the accused voluntarily gave his Bullet bike to her. This is altogether different evidence than the averment made in the complaint. Therefore, the receipt of the said blank cheques from the accused at the time of entering into partnership firm cannot be ruled out in view of the evidence placed on record from the complainant. He must have given the blank cheques. It has come in her evidence that, it is she, who wrote the contents of the said cheques. Perhaps blank cheques must have been made use by the complainant. Therefore, as rightly observed by the Trial Court, the defence of the accused is more probable than the complainant. - 22 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 22. The presumption, which is very much available under the provisions of Sections 118 and 139 of the N.I. Act, is rebutted by the accused by leading cogent evidence. The evidence spoken by PW.1 is quite contrary with regard to the investment in the partnership business by the accused as per Ex.D1. There is no suggestion directed to DW.1 to that effect. More so, accused consistently claims in his defence that, he has issued Ex.P10 so as to repay Rs.1,00,000/- in respect of the Bullet Motorbike transaction. Accused has admitted that, the complainant had financed towards purchase of his bike. That means, for a different transaction, the said cheque was issued and not the transaction so alleged by the complainant in the complaint as spoken in her evidence. It is his defence that, he came to know that, cheque was presented by the complainant. It was dishonoured for the want of 'sufficient funds'. On getting knowledge about the said dishonour, as accused had knowledge about possession of the blank signed cheques with a complainant, he issued a direction to his Banker 'to - 23 - NC: 2025:KHC:13178 CRL.A No. 830 of 2019 stop the payment'. When the said impugned cheques are presented, they were dishonoured because of direction to stop the payment. So the probability of the case has to be taken into consideration. The complainant must have tried to misuse the said cheques on the guise that, she has lent loan to the accused. The learned Trial Court elaborately discussed all these aspects in its well reasoned judgment. I do not find any factual or legal error in appreciation of evidence by the Trial Court in disbelieving the case of the complainant and believing the probable defence of the accused. 23. No doubt, so many grounds have been made out by the complainant in the appeal memo, as well as during the course of the arguments. The learned Trial Court is right in disbelieving the case of the complainant and acquitting the accused. Therefore, if all these factual
Decision
ORDER (i) The Criminal Appeal is dismissed. (ii) Impugned judgment dated 27.03.2019 passed in C.C.No.5838/2018 by the XVI Additional Chief Metropolitan Magistrate, Bengaluru City, is affirmed. (iii) Bail bonds of the accused, if any, stands discharged. (iv) Send a copy of this judgment to the Trial Court forthwith for reference. Sd/- (RAMACHANDRA D. HUDDAR) JUDGE AM List No.: 1 Sl No.: 8