The High Court
Case Details
- 1 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 26TH DAY OF APRIL, 2025 BEFORE THE HON'BLE MS JUSTICE J.M.KHAZI CRIMINAL REVISION PETITION NO. 1131 OF 2016 BETWEEN: B R JADAV S/O LATE SUBBOJI RAO, AGED ABOUT 55 YEARS R/AT NO.40/301, RAGHVENDRA RESIDENCY 17TH CROSS, 12TH MAIN, J P NAGAR 5TH PHASE, BANGALORE - 78 …PETITIONER (BY SRI. RAVINDRA B S, ADVOCATE) AND: SRI. M A CHOWDAPPA S/O LATE ASWATHANARAYANA RAO AGED ABOUT 75 YEARS R/AT NO 17, 17TH CROSS, J P NAGAR, 5TH PHASE, BANGALORE - 78 …RESPONDENT (BY SRI. RAGHAVENDRA K, ADVOCATE) THIS CRL.RP IS FILED U/S.397 R/W 401 CR.P.C BY THE ADVOCATE FOR THE PETITIONER PRAYING TO SET ASIDE JUDGMENT AND ORDER DATED 01.08.2016 PASSED BY THE LIX ADDL. CITY CIVIL AND SESSION JUDGE, BANGALORE CITY IN CRL.A.NO.314/2015 AND THE JUDGMENT AND ORDER DATED 10.02.2015 PASSED BY THE XXII ACMM, BANGALOARE IN C.C.NO.22037/2012 AND ACQUIT THE PETITITONER FOR CHARGES LEVELED AGAINST HIM. Digitally signed by REKHA R Location: High Court of Karnataka - 2 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 THIS PETITION, COMING ON FOR HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MS JUSTICE J.M.KHAZI ORAL ORDER This petition filed under Section 397(1) and 401(1) of the Code of Criminal Procedure, is by the accused challenging the judgment and order of conviction passed
Legal Reasoning
by the trial Court for the offence punishable under Section 138 of N I Act, which came to be confirmed by the Sessions Court by dismissing the appeal filed by him. 2. For the sake of convenience, parties are referred to by their ranks before the trial Court. 3. Complainant filed a complaint under Section 200 of Cr.P.C, alleging offence punishable under Section 138 of N.I. Act, contending that during the month of February 2010, accused requested to lend Rs.40 lakhs for the purpose of land development i.e., formation of layout/residential sites. Accordingly, complainant paid - 3 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 Rs.15 lakhs, Rs.15 lakhs and Rs.10 lakhs through cheques and the said cheques are encashed. 3.1 Accused promised to return the loan taken from the complainant together with interest at 24% per annum. On his failure and on repeated request and demand, accused issued cheque dated 25.12.2011 for Rs.40 lakhs towards principal and cheque dated 15.04.2012 for Rs.15 lakhs towards interest. However, when presented the cheques were dishonoured as funds insufficient. Complainant got issued legal notice which is returned as not claimed. Accordingly, complainant filed two separate complaints. 4. After due service of summons, accused appeared through counsel and contested the case by pleading not guilty. 5. In order to prove the allegations against accused, the complainant examined himself as PW-1 and got marked Ex.P1 to 12. - 4 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 6. During his statement under Section 313 of Cr.P.C, the accused denied the incriminating evidence led by the complainant. 7. Accused has also given evidence as DW-1 and got marked Ex.D1. 8. So far as present case is concerned, i.e., dishonour of cheque for Rs.40 lakhs the trial Court convicted the accused and sentenced him to pay fine of Rs.40,00,000/- with interest at 6% p.a with default sentence of imprisonment. 9. So far as cheque for Rs.15 lakhs is concerned, the trial Court dismissed the complaint. 10. Accused challenged his conviction and sentence before the Sessions Court in Crl.A.No.314/2015, whereas complainant filed Crl.A.No.479/2015 challenging the inadequate sentence of fine and compensation. The Sessions Court clubbed both appeals and by a common order dismissed them. - 5 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 11. Challenging the concurrent findings of the trial Court as well as the Sessions Court, accused has filed this petition contending that both Courts have failed to appreciate that there is no legally recoverable debt or liability and that the complainant has failed to establish that accused taken loan of Rs.40 lakhs for land development. They have also failed to appreciate the defence of the accused that the said amount was paid towards sale transaction of Flat No.007. Ex.P9 and 10 establish that Rs.40 lakhs paid by the complainant was towards investment of purchase of 20 acres of land. The cheques in question were issued towards security and the same has been misused by the complainant. By imposing interest at 6%, the trial Court has converted a complaint into civil suit. The Courts below have also not appreciated that Rs.40 lakhs paid by the complainant is not reflected in his income tax returns and pray to allow the appeal. 12. On the other hand, learned counsel representing the complainant supported the impugned judgment and order of the trial Court as well as the - 6 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 Sessions Court and submitted that in the light of the fact that the cheque in question is drawn on the account of the accused and it bears his signature, presumption under Section 139 of the N.I Act comes into play, placing the initial burden on the accused to rebut the same. In the present case, the accused has not only failed to rebut the presumption, and taken false defence. Considering the oral and documentary evidence on record, both courts have come to a correct conclusion. There is no perversity calling for interference by this Court, in exercise of its revisionary jurisdiction and sought for dismissal of the petition. 13. Heard arguments of both sides and perused the record. 14. It is not in dispute that the cheque in question is drawn on the account of accused and it bears his signature and when presented for realisation, it is dishonoured for want of sufficient funds. After issuing legal notice, complaint is filed. Therefore, presumption under - 7 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 Sections 118 and 139 of the N.I Act comes into picture to the effect that the cheque was issued towards repayment of any legally recoverable debt or liability, placing the initial burden on the accused to rebut the same. 15. It is pertinent to note that the legal notice sent to the accused is returned as not claimed. A suggestion is made to the complainant that accused was not residing in the address to which notice as per Ex.P5 is sent. During the course of his evidence, accused has deposed that the complainant has not sent any legal notice and in collusion with postal authorities he has secured a false endorsement. However, during his cross-examination he has admitted that his address as specified in the complaint as well as in the legal notice is correct. The endorsement on the postal envelope indicate that despite intimation regarding the registered post was given, accused has not claimed it. 16. Under Section 27 of General Clauses Act, where any Central Act or Regulation made after the commencement of this Act authorized or requires any - 8 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 documents to be served by post, whether the expression "serve" or either of the expressions "give" or "send" or any other expression is used, then, unless a different intention appears, the service shall be deemed to be effected by properly addressing, pre-paying and posting by registered post, a letter containing the document, and, unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post. 17. In the light of the same, presumption is in favour of the complainant that notice is duly served and it is not open to the accused to claim otherwise. 18. By not sending reply to the legal notice, the accused has failed to spell out his defence at the earliest available opportunity. Before this Court he has taken multiple defences. At one breathe he claim that Rs.40 lakhs paid by the complainant is an investment in the land development. At the other breathe, he claim that the flat - 9 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 purchased by complainant was for Rs.68 lakhs and in the sale deed it's value is noted as Rs.28 lakhs and Rs.40 lakhs paid through the cheques is towards balance sale consideration. Yet again he claim that Rs.40 lakhs paid through cheques has gone to the purchaser and he is not liable to repay the same. 19. It is not in dispute that through sale deed at Ex.D1, complainant has purchased a Flat. Accused has executed the sale deed as the power attorney holder of its owner. The sale consideration is Rs.28 lakhs and the same is paid through 4 cheques as detailed in Page No.6. The same would go to the owner. These cheque numbers are different from the cheque numbers through which the complainant has paid Rs.40 lakhs to the accused as per Ex.P9. Admittedly, accused has received Rs.40 lakhs through 3 cheques as detailed in Ex.P9. At any stretch of imagination, it cannot be accepted that Rs.40 lakhs received by the accused is towards sale consideration of the flat. The accused has not examined owner of the flat - 10 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 to prove that Rs.40 lakhs paid to the accused is part of the sale consideration and that he has received it. 20. Clause 5 of Ex.P9 state that Rs.40 lakhs paid by complainant is a financial assistance given by complainant to the accused which he is liable to repay with interest at 24%. When the accused has decided to return the principal amount and interest to the complainant, they have entered into an agreement of settlement at Ex.P10, according to which cheque dated 25.12.2011 for Rs.40 lakhs towards principal was issued. They have calculated the interest at Rs.15 lakhs and accused has agreed to sell a site in lieu of interest. 21. Time and again during the cross-examination of the complainant, the accused has challenged his financial capacity. Since the complainant has paid Rs.40 lakhs to the accused through cheques and it is credited to his account, question of necessity of complainant establishing his financial capacity would not arise. - 11 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 22. It is submitted by the learned counsel for accused that the trial Court is not empowered to grant interest. The punishment prescribed for the offence under Section 138 of N.I. Act is imprisonment for a term which may extend to two years or with fine which may extend to twice the amount of the cheque or with both. It is pertinent to note that the trial Court has imposed fine of Rs.40,05,000/- and out of this Rs.5,000/- is ordered to be defrayed as litigation expenses and credited to the Government. Remaining Rs.40 lakhs with interest at 6% per annum is ordered to be paid to the complainant by way of compensation. Instead of quantifying the interest in the form of fine or compensation, the trial Court has ordered for payment of interest on the compensation. 23. In fact as per Section 79 of N.I. Act, there is provision for payment of interest on the promissory note or bill of exchange as per the agreement between the parties. As per Section 80, when no rate of interest is specified in the instrument, it may be granted at the rate - 12 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 of 6% per annum, which is increased to 18% with effect from 30.12.1988. Therefore, this Court is of the considered opinion that no illegality is committed by the trial Court in imposing the interest on the compensation. 24. The trial Court as well as Sessions Court on proper appreciation of oral and documentary evidence placed on record have rightly held that the allegation against accused are proved. This Court finds no perversity in the findings and conclusions arrived at by them, calling for interference by this Court. In the result, the petition fails and accordingly, the following:
Decision
ORDER 1. Petition filed by the accused under Section 397 r/w 401 of Cr.P.C. is dismissed. 2. The impugned judgment and order dated 10.02.2015 in CC.No.22037/2012 on the file of XXII ACMM, Bengaluru and judgment and order dated 01.08.2016 in - 13 - NC: 2025:KHC:17378 CRL.RP No. 1131 of 2016 Crl.A.Nos.314/2015 and 479/2015 on the file of LIX Addl.City Civil and Sessions Judge, Bengaluru are hereby confirmed. 3. The Registry is directed to send back the trial Court records as well as Sessions Court records along with copy of this order forthwith. Sd/- (J.M.KHAZI) JUDGE ASN List No.: 1 Sl No.: 27