Criminal Appeal No. 676 of 2015 · The High Court
Case Details
- 1 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 21ST DAY OF FEBRUARY, 2025 THE HON'BLE MR JUSTICE SHIVASHANKAR AMARANNAVAR BEFORE CRIMINAL APPEAL NO. 676 OF 2015 BETWEEN: THE MARUTHI MERCHANTS FINANCE COMPANY NO.179, 3RD MAIN KEMPEGOWDA NAGARA T.DASARAHALLI BANGALORE-560 057 REP. BY ITS PROPRIETOR SRI. MANJAIAH B.H. S/O HANUMAIAH AGED ABOUT 39 YEARS Digitally signed by LAKSHMINARAYANA MURTHY RAJASHRI Location: HIGH COURT OF KARNATAKA (BY SRI. V.B. SIDDARAMAIAH, ADVOCATE) …APPELLANT AND: SRI. MUKTHAR PASHA S/O AMIRZAN (MIRZA) AGED ABOUT 45 YEARS SAVSAL WORLD CLASS - 2 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 LUBRICANTS (OIL SHOP) OFF: MUTHOOT FIN CORP ABBIGERE MAIN ROAD, K.G.HALLI JALAHALLI WEST BANGALORE-560 015 AND ALSO NO.37, 1ST FLOOR, WARD NO.1 KALANAGARA, 9TH MAIN ROAD KAMMAGONDANAHALLI NEAR SANJEEV ENGINEERING WORK, JALAHALLI WEST BANGALORE-560 015
Legal Reasoning
(BY SRI. H.A. RAMALINGE GOWDA, ADVOCATE) …RESPONDENT THIS CRL.A. IS FILED U/S.378(4) OF CR.P.C PRAYING TO SET ASIDE THE ORDER DATED:12.5.2015, PASSED BY THE XXVII ACMM, BANGALORE, IN C.C.NO.3286/14 - ACQUITTING THE RESPONDENT/ACCUSED FOR THE OFFENCE P/U/S 138 OF N.I. ACT. THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: - 3 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 CORAM: HON'BLE MR JUSTICE SHIVASHANKAR AMARANNAVAR ORAL JUDGMENT This appeal is filed by the complainant praying to set aside the judgment of acquittal dated 12.05.2015 passed in C.C.No.3286/2014 by the XXVII Additional Chief Metropolitan Magistrate, Bengaluru, whereunder the respondent - accused has been acquitted for offence under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as 'N.I. Act', for short). 2. The case of the complainant in brief is as under: On 10.12.2012, the respondent - accused has borrowed Rs.2,60,000/- from the appellant - complainant agreeing to repay the same within seven months with interest at 16% p.a. The accused failed to repay the loan as agreed by him, however after repeated request and - 4 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 demands made by the complainant, the accused has agreed to repay the loan amount, for which he has issued cheque bearing No.013826, dated 16.12.2013 for Rs.2,60,000/- drawn on State Bank of Mysore, HMT Industrial Estate Branch, Bengaluru. The complainant presented the said cheque for encashment. The said cheque came to be dishonoured and returned with an endorsement as "Account Closed". The complainant got issued legal notice dated 10.01.2014 to the accused and the same has been returned with shara as ‘Refused’. The accused has not repaid the cheque amount. Therefore, the complainant has filed a private complaint against the respondent - accused for offence under Section 138 of the N.I. Act. 3. The learned Magistrate has taken cognizance and registered C.C.No.3286/2014 against the respondent - accused for offence under Section 138 of the N.I. Act. The complainant in order to prove his case has examined the - 5 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 Proprietor as PW.1 and got marked Exs.P1 to P14. The statement of the accused has been recorded under Section 313 of Cr.P.C. The accused examined himself as DW.1 and no documents are marked on defence side. The learned Magistrate after hearing the arguments on both sides has formulated points for consideration and passed the impugned judgment of acquittal. The said judgment of acquittal has been challenged by the complainant in this appeal. 4. Heard the learned counsel for the appellant and the learned counsel for the respondent. 5. Learned counsel for the appellant would contend that the respondent - accused has admitted his signature on the cheque - Ex.P1 and therefore, presumption arises under Section 139 of the N.I. Act that the cheque is issued for discharge of debt. The said presumption has not been rebutted by the respondent - - 6 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 accused. The respondent - accused has taken up defence that the signed cheque has been given as security for loan earlier obtained by him from the complainant, but the same has not been established. The complainant has produced loan application, cash receipt and other documents in order to establish the loan availed by the respondent - accused. The complainant has also produced Ex.P14 - money lending licence. He further submits that as presumption under Section 139 of N.I. Act is not rebutted, the accused has to be convicted for offence under Section 138 of the N.I. Act, as other ingredients are satisfied. On that point, he places reliance on the decision of the Hon’ble Apex Court in the case of Rajesh Jain v. Ajay Singh reported in (2023) 10 SCC 148. He further submits that without considering all these aspects, the learned Magistrate has erred in acquitting the respondent - accused by the impugned judgment. With this, he prayed to allow the appeal and convict the respondent – accused for offence under Section 138 of the N.I. Act. - 7 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 6. The learned counsel for the respondent - accused would contend that the appellant stated to be a money lender, he has to maintain statement of loan account of the borrowers. The statement of loan account has not been produced. The respondent - accused has denied the executing documents - Exs.P8 to Ex.P13. What was the due amount has not been stated either in statutory notice or in the complainant or in evidence of PW.1. The cheque leaf of Ex.P1 is of the year ……..19……. and that itself indicate that it is old cheque which was given as a security for earlier amount availed by the respondent - accused. The appellant - complainant i.e., PW.1 has admitted in cross-examination regarding the accused availing loan earlier from him. Considering the said aspect, the respondent - accused has rebutted the presumption drawn under Section 139 of the N.I. Act. The appellant - complainant has not established that the cheque - Ex.P1 has been issued for payment of legally enforceable debt. Considering these aspects, the learned Magistrate has rightly acquitted the respondent - accused - 8 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 for offence under Section 138 of the N.I. Act. With this, he prayed for dismissal of the appeal. 7. Having heard the learned counsels, this Court has perused the impugned judgment and the Trial Court records. 8. Considering the grounds urged, the following point arises for consideration: "Whether the learned Magistrate has erred in acquitting the respondent - accused for offence under Section 138 of the N.I. Act?" 9. My answer to the above point is in Negative for the following reasons: It is a specific case of the appellant - complainant that the respondent - accused has availed a loan of Rs.2,60,000/- on 10.12.2012, agreeing to repay the same with interest at 16% p.a., within seven months and he has issued a cheque - Ex.P1 for Rs.2,60,000/- dated - 9 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 16.12.2013 for repayment of the amount borrowed. The respondent - accused has admitted the signature on cheque - Ex.P1. Whereas signature on the cheque is admitted presumption under Section 139 of the N.I. Act, has to be drawn that the cheque is issued for discharge of debt. The said presumption is rebuttable presumption. The Standard of Proof for rebutting the said presumption, is preponderance of probability. The Hon'ble Apex Court in the case of Rajesh Jain (supra) has held at para Nos.55 and 62, as under: "55. At the stage when the courts concluded that the signature had been admitted, the court ought to have inquired into either of the two questions (depending on the method in which the accused has chosen to rebut the presumption) : Has the accused led any defence evidence to prove and conclusively establish that there existed no debt/liability at the time of issuance of cheque? In the absence of rebuttal evidence being led the inquiry would entail : Has the accused proved the non- existence of debt/liability by a preponderance of - 10 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 probabilities by referring to the “particular circumstances of the case”? …….. 62. In the teeth of the aforesaid analysis, we have not the slightest of hesitation in concluding that this case calls for interference, notwithstanding that both the courts below have concurrently held in favour of the accused. Since we have answered Point (i) in the negative, the need to examine Point (ii) does not arise." 10. The defence of the respondent - accused is that he has not availed any loan from the complainant on 10.12.2012 and cheque - Ex.P1 has been issued as a security to the amount borrowed by him earlier from the complainant. PW.1 in his cross-examination has admitted that accused has borrowed loan from him in the year 2004. PW.1 has denied the suggestion that at the time of borrowing loan in the year 2004 for a sum of Rs.25,000/-, the cheque given as a security has not been returned even after discharge of the said debt. DW.1 - accused has - 11 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 disputed the signatures on the loan application - Ex.P8, cash receipt - Ex.P9, cash voucher - Ex.P10, cash receipts - Exs.P11 and P12 and the cheque received receipt - Ex.P13. The accused has stated that his signatures on these documents are forged. The cheque leaf of Ex.P1 is of the year "……….19 ……………." The date of cheque is 16.12.2013. The reason for dishonour of Ex.P1 – cheque is ‘account closed’. The using of the cheque leaf of the year "….19…." in the year 2013 and reason for dishonor that account closed itself probablize the defence of respondent - accused that the cheque is issued as security for the amount borrowed earlier from the complainant. Considering the said aspect, the respondent - accused has rebutted the presumption drawn under Section 139 of N.I. Act. 11. The complainant is a financier running a finance company as its Proprietor holding money lending licence – Ex.P14. Execution of Ex.P8 to Ex.P13 are - 12 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015 disputed by the accused. There is no document such as promissory note stated to have been executed by the respondent - accused. As the complainant is a money lender it has to maintain books of accounts of loan account of the borrowers. No such books of accounts by the respondent – accused is produced. PW.1 in his cross- examination has admitted that payment of any amount more than Rs.20,000/- has to be through cheque. But in the present transaction, it is alleged that the amount borrowed in a sum of Rs.2,60,000/- is given by way of cash. PW.1 has also admitted that he has to intimate the Income Tax Department regarding the amount lend by him and he has to give report to the Money Lending Licencing Authority as to how much money he has lent and to whom. He has not produced any documents in that regard. Considering all this aspect, the complainant has not established that respondent - accused has borrowed Rs.2,60,000/- and issued a cheque for discharge of the debt. Considering all this aspect, the learned Magistrate has rightly acquitted the respondent - accused. - 13 - NC: 2025:KHC:7934 CRL.A No. 676 of 2015
Decision
12. In the result, the following: ORDER The appeal is dismissed. Sd/- (SHIVASHANKAR AMARANNAVAR) JUDGE KG List No.: 1 Sl No.: 54