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Bangalore District Court
Shreyas Aithya vs Krishnappa R on 22 July, 2025
SCCH-2 1 C.C.No.414/2020
KABC020017742020
IN THE COURT OF THE VI ADDL. JUDGE, COURT OF
SMALL CAUSES AND ADDL. CHIEF JUDICIAL
MAGISTRATE, BENGALURU CITY (SCCH-2).
C.C.NO.414/2020
:: PRESENT ::
Sri. H.P. Mohan Kumar, B.Sc.,LL.B.,
6th Addl. Judge, Court of Small
Causes and ACJM, Bengaluru.
Dated: On this the 22nd day of July, 2025.
Complainant : Sri.Shreyas Aithya,
Aged about 30 years,
Son of M.N. Shrikant,
Residing at No.47,
3rd Cross, Jnaneshwari Layout,
Vidyaranyapura,
Bengaluru-560 097.
(By Sri. Raju N.E., Advocate)
- Vs. -
Accused : Sri. Krishnappa R.,
Aged about 55 years,
SCCH-2 2 C.C.No.414/2020
S/o Rangappa,
Residing at No.8, Yeshas Nilaya,
7th A Main, 7th Cross,
M.E.I. Layout, Bagalgunte,
Bengaluru-560 073.
(By Sri. Omkara Murthy G., Advocate)
:: J U D G M E N T :
:
The complainant has filed the present complaint
U/Sec.200 of Cr.P.C., alleging that the accused has
committed the offence punishable U/Sec.138 of Negotiable
Instruments Act (herein after referred as N.I.Act).
2. The case of the complainant in brief is as follows:-
The accused has approached the complainant during the
month of September-2015 and stated that, he intend to
develop the residential sites in the property bearing
Sy.No.156, new Sy.No.156/7 situated at Chikkabanavara
Village, Yeshwanthapura Hobli, Bengaluru North Taluk,
Bengaluru, which was purchased under the sale deed
dated:07.09.2015 before the Sub-Registrar, Rajajinagar
(Peenya), Bengaluru. The accused assured that, he will
complete the above said project within two years and offered
to sell one site measuring 30 feet x 50 feet. In this regard, as
per the demand made by the accused, the complainant has
paid advance amount of Rs.3,00,000/- on 14.09.2015 and
SCCH-2 3 C.C.No.414/2020Rs.4,30,000/-, on 15.04.2018 by way of cash, in total
Rs.7,30,000/- to the accused.
After the completion of two years, the accused failed to
develop and form the layout in the property. On repeated
demands made by the complainant, the accused accepted his
liability and agreed to return the amount paid by the
complainant and issued the post dated cheque bearing
No.362788, dated:22.07.2019, for Rs.7,30,000/- drawn on
Canara Bank, Bagalagunte Branch, Bengaluru and assured
to honour the cheque on its presentation.
As per the instructions of accused, the complainant has
presented the said cheque for encashment through his
banker i.e., ICICI Bank Ltd., Manyata Tech Park Branch,
Bengaluru. However, the said cheque got dishonoured for
the reason as “Insufficient Funds” as per endorsement
dated:03.10.2019 and it was received by the complainant on
05.10.2019. Further, the complainant has issued the legal
notice to the accused on 02.11.2019. The said notice was
duly served on the accused on 04.11.2019. The accused
failed to comply the demands made in the notice. Hence,
cause of action arose to file the complaint.
SCCH-2 4 C.C.No.414/2020
3. The cognizance was taken for the offence punishable
U/Sec.138 of N.I.Act. After filing of the complaint, the sworn
statement of the complainant was recorded and it prima-
facie found that the accused has committed the offence
punishable U/Sec.138 of N.I.Act. Hence, criminal case was
registered and the summons was issued to the accused.
4. In response to the summons, the accused appeared
through his counsel and thereafter plea was recorded. The
accused was denied the accusation leveled against him,
claimed to be tried. Further, the statement of the accused as
contemplated U/Sec.313 of Cr.P.C., was recorded. The
accused has denied the incriminating evidence appeared
against him in the evidence of complainant and submitted
that he has defence evidence.
5. The Hon’ble Apex Court of India in Indian Bank
Association and Others vs Union Bank of India and
Another reported in AIR 2014 SC 2528, held that “Sworn
Statement of the complainant has to be treated as
examination in chief”. In the instant case, the complainant
examined himself as P.W.1 and marked Ex.P.1 to Ex.P.4 and
Ex.P.3(a). Thereafter, the SPA holder of the complainant is
permitted to prosecute the case. Hence, the SPA holder of
SCCH-2 5 C.C.No.414/2020
complainant namely Swetha A.A. examined as P.W.2 and
marked Ex.P.1 to Ex.P.5 and Ex.P.3(a). P.W.2 was subject to
the process of cross-examination from the side of accused.
The accused examined himself as D.W.1 and marked Ex.D.1
to Ex.D.7. D.W.1 was subject to the process of cross-
examination from the side of complainant.
6. Heard the arguments from both side. Perused the
materials available on record.
7. Now the points that arise for consideration of this Court
are as hereunder:
1. Whether the
complainant has proved
that the accused has
committed the offence
punishable U/Sec.138 of
N.I.Act?
2. What Order?
8. The findings of this Court to the above-referred points
are as follows:
Point No.1: In the Negative.
Point No.2: As per final order,
for the following:-
SCCH-2 6 C.C.No.414/2020
REASONS
9. POINT No.1: In order to prove the case, initially the
complainant himself examined as PW.1. Further it is
relevant to note that the SPA holder of the complainant
examined herself as P.W.2 by filing affidavit in support of her
oral examination-in-chief. In the affidavit P.W.2 has
reiterated the complaint averments in verbatim. Hence, this
Court need not to recapitulate the same once again at this
juncture. In support of her oral testimony, P.W.2 has
marked documents at Ex.P.1 to Ex.P5 and Ex.P.3(a). The
accused examined himself as D.W.1 and marked Ex.D.1 to
Ex.D.7.
10. Now itself it is appropriate to see the documents
marked at Ex.P-Series and Ex.D-Series.
Ex.P-Series
Ex.P.1 is the cheque in question. Ex.P.1(a) is the signature
of accused. Ex.P.2 is the bank endorsement
dated:04.10.2019. Ex.P.3 is the office copy of the legal notice
dated:02.11.2019. Ex.P.3(a) is the RPAD receipt. Ex.P.4 is
the acknowledgment due card. Ex.P.5 is the Special Power of
Attorney dated:27.05.2022 executed by the complainant in
favour of P.W.2.
SCCH-2 7 C.C.No.414/2020
Ex.D-Series.
Ex.D.1 to Ex.D.7 are the legal notices issued by various
persons to the accused.
11. Before going to discuss the main aspect, it is worth to
reproduce the provisions of Sec.138 and 139 of N.I.Act, the
same as hereunder:
138. Dishonour of cheque for insufficiency, etc., of
funds in the account: –
Where any cheque drawn by a person on an
account maintained by him with a banker for
payment of any amount of money to another
person from out of that account for the
discharge, in whole or in part, of any debt or
other liability, is returned by the bank
unpaid, either because of the amount of
money standing to the credit of that account
is insufficient to honour the cheque or that it
exceeds the amount arranged to be paid from
that account by an agreement made with that
bank, such person shall be deemed to have
committed an offence and shall, without
prejudice to any other provisions of this Act,
SCCH-2 8 C.C.No.414/2020be punished with imprisonment for (a term
which may be extended to two years), or with
fine which may extend to twice the amount of
the cheque, or with both:
Provided that nothing contained in this
section shall apply unless-
(a) the cheque has been presented to the bank
within a period of Six months from the date
on which it is drawn or within the period of
its validity, whichever is earlier; (The period
of 6 months has been reduced to 3 months,
vide R.B.I. notification No.RBI/2011-
12/251,DBOD.AMLBC No.47/14.01.001/2011-
12, dated:4th November 2011 (w.e.f.
01.04.2012))
(b) the payee or the holder in due course of the
cheque, as the case may be, makes a demand
for the payment of the said amount of money
by giving a notice in writing, to the drawer of
the cheque, within thirty days of the receipt
of information by him from the bank
regarding the return of the cheque as unpaid;
and
SCCH-2 9 C.C.No.414/2020
(c) the drawer of such cheque fails to make the
payment of the said amount of money to the
payee or, as the case may be, to the holder in
due course of the cheque, within fifteen days
of the receipt of the said notice.
Explanation: – For the purposes of the section,
“debt or other liability” means a legally enforceable
debt or other liability.
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 discharge, in whole or in
part, of any debt or other liability.
12. Learned counsel for the complainant has relied on
the following decisions:
1. AIR 2023 Supreme Court 5018, between
Rajesh Jain Vs. Ajay Singh.
2. (2019) 4 Supreme Court Cases 197,
between Bir Singh Vs. Mukesh Kumar.
SCCH-2 10 C.C.No.414/2020
3. AIR 2019 Supreme Court 1876, between
Rohitbhai Jivanlal Patel Vs. State of
Gujarat and Another.
Learned counsel for the accused has relied on the
following decisions:
1. Criminal Appeal No. 665/2014 (A) between
Smt R Vijaya Kumari Vs. Smt Moksha
Bhagyam.
2. Criminal Appeal No. 45/2018 between Sri
P R Sarveshwar Reddy Vs. Sri A
Somashekar Reddy.
3. (2024) 9 SCC 390 between Rajco Steel
Enterprises Vs. Kavita Saraff and another.
I have carefully gone through the decision relied by
both side and applied the principles to the case on hand.
13. At this juncture it is worth to refer the decision of the
Hon’ble Apex Court reported in AIR 2010 S.C. 1898,
between Rangappa V/s Mohan wherein their lordships have
observed at para 26 as hereunder:
SCCH-2 11 C.C.No.414/2020
“No doubt that there is a initial
presumptionwhich favours the
complainant”.
14. It is germane to note that the proceedings U/Sec.138
of N.I. Act is an exception to the general principle that the
accused is presumed to be innocent until the charge leveled
against him is proved beyond reasonable doubt. In the
proceedings initiated U/Sec.138 of the N.I. Act proof of
beyond reasonable doubt is subject to the presumption
envisaged under Sec.139 of the N.I. Act. Once the
requirement of Sec.138 of the N.I. Act is fulfilled, then it has
to be presumed that the cheque was issued in discharge of
legally recoverable debt or liability. The presumption
envisaged under Sec.139 of N.I. Act is mandatory
presumption and it has to be raised in every cheque bounce
cases.
15. According to the complainant he has lent
Rs.7,30,000/- to the accused in cash. The accused was
agreed to sell one site measuring 30 x 50 feet. After two
years when the complainant was demanded, the accused has
issued the post dated cheque. In the instant case the
accused examined himself as DW.1. Thereafter, he was cross
examined. During the course of his examination in chief, he
SCCH-2 12 C.C.No.414/2020
has admitted that the signature found in Ex.P1 is his
signature. Therefore, it is crystal clear that Ex.P1 is
pertaining to the bank account of accused and Ex.P1(a) is
the signature of accused. A careful perusal of Ex.P1 coupled
with Ex.P2, it is of the opinion of this court that the
complainant has presented the cheque within the stipulated
time. Like wise the complainant has issued the notice within
30 days from the date of bank endorsement. During the
course of cross-examination of DW.1, he has clearly admitted
the issuance of notice by the complainant. As such it is
manifestly clear that the complainant has issued the legal
notice in accordance with law and the same has been duly
served on the accused. That apart, the presumption under
Sec.118 and 139 of Negotiable Instruments Act favours the
complainant. Hence, the complainant has complied the
ingredients of Sec.138(a) to (c) of N.I. Act.
16. Now, it is worth to refer the decision of the Hon’ble
Apex Court between Hiten P Dalal V/s Brathindranath
Manarji reported in 2001(6) SCC 16, wherein the Hon’ble
Apex Court observed that, “under Sec.138 of Negotiable
Instruments Act, the complainant is not required to
establish either the legality or enforceability of the debt
or liability since he can avail the benefit of presumption
U/Sec.118 and Sec.139 of N.I. Act in his favour”.
SCCH-2 13 C.C.No.414/2020
17. It is also settled position of law that, the presumption
available U/Sec. 138 of N.I Act is a rebuttable presumption.
Further, to rebut the said presumption the accused need not
to enter into the witness box. However, the accused can
establish his probable defence by creating a doubt about the
existence of legally enforceable debt or liability.
18. Further, it is also settled position of law that, the
standard of proof of rebutting the presumption is that of
preponderance of probabilities. It is also settled position of
law that, if the accused succeeded in rebutting the
presumption then the burden shifts back to the complainant.
At this juncture, again it is worth to refer the decision of the
Hon’ble Apex Court reported in AIR 2010 S.C. 1898,
between Rangappa Vs. Sri. Mohan, wherein the Hon’ble
Apex Court has observed that, “the standard of proof to
rebut the presumption is that one of preponderance of
probabilities”.
19. It is also settled position of law that, “it is
immaterial that, the cheque may have been filled in by
any person other than the drawer, if the cheque is duly
signed by the drawer. If the cheque otherwise valid,
within the provisions of Sec.138 would be attracted”.
SCCH-2 14 C.C.No.414/2020
20. Now, the question before this court is whether the
accused has rebutted the presumption or not?. In the instant
case, the complainant examined himself as PW.1. Before
tendering himself for cross-examination, his power of
attorney holder is examined as PW.2. Now the question
before this court is whether the complainant has established
the alleged transaction or not?. Admittedly, the complainant
though examined as PW.1, he has not enter the witness box
in order to subject himself for cross-examination from the
side of accused. Apart from that, his wife examined as PW.2
by filing affidavit. During the course of arguments from the
side of accused, the learned counsel for accused pointed out
that the wife of the complainant had no personal knowledge.
Though the wife of the complainant is examined as PW.2, the
same will not come to the aid of complainant to prove the
alleged loan transaction. If the complainant would have
appeared before this court, certainly true facts would
unearth. Therefore intentionally PW.1 has failed to offer
himself for cross-examination. He also pointed out that the
father of PW.2 and accused were friends. The father of PW.2
misused the cheques and handed over to his relatives and
managed to file cases against accused. Ex.D1 to Ex.D7 are
the documents to show the relatives of PW.2 have issued the
legal notices to the accused.
SCCH-2 15 C.C.No.414/2020
21. Per contra the counsel for complainant would submit
that the accused has admitted the cheque, his signature and
also the issuance of legal notice. He has not issued any
reply. He has not filed any complaint regarding misusing of
cheques. The accused is in the habit of receiving money
from various persons and issued the cheques. Ex.D1 to
Ex.D7 shows the conduct of accused. PW.2 is none other the
wife of PW.1. Hence PW.2 had personal knowledge to depose
before this court.
22. Now, the important question before this court is,
whether the complainant has established the alleged
transaction or not?. On careful perusal of the cross-
examination of PW.2, it can be inferred that the accused has
disputed the alleged transaction. On careful perusal of the
affidavit filed by the PW.2, she has stated that the accused
had collected Rs.3,00,000/- by way of cash on 14.09.2015
and Rs.4,30,000/- by way of cash on 15.04.2018.
Admittedly, the accused has not executed any sale
agreement either in favour of complainant or in favour of
PW.2. According to the complaint averments, the 1 st
payment was made on 14.09.2015. At which point of time
also there was no document taken from the side of accused.
Likewise the 2nd payment was on 15.04.2018. At which point
SCCH-2 16 C.C.No.414/2020
of time also the accused has not executed any document.
More importantly there was no agreement to sell executed by
accused either in favour of complainant or any one else. The
said aspects creates doubt about the alleged loan
transaction.
23. Besides the above referred aspects, the vital question
before this court is whether the PW.2 has personal
knowledge about the alleged transaction or not?. At this
juncture it is worth to rely on the decision of Hon’ble Apex
Court reported in 2014(11) SCC 790 between A C
Narayanan Vs. State of Maharashtra and another. The
Hon’ble Apex Court held that:
“We are of the view that the
power of attorney holder may be
allowed to file, appear and depose
for the purpose of issue of process
for the offence punishable under
Section 138 of the N.I. Act. An
exception to the above is when
the power of attorney holder of
the complainant does not have a
personal knowledge about the
transactions then he cannot be
examined. However, where the
attorney holder of the
complainant is in charge of the
business of the complainant-payee
SCCH-2 17 C.C.No.414/2020and the attorney holder alone is
personally aware of the
transactions, there is no reason
why the attorney holder cannot
depose as a witness. Nevertheless,
an explicit assertion as to the
knowledge of the Power of
Attorney holder about the
transaction in question must be
specified in the complaint.
24. Therefore it is settled portion of law that the power of
attorney holder can appear as witness. However if he does
not have personal knowledge regarding the transactions he
cannot be examined. Hence the paramount requirement of
examination of power of attorney holder is that, he or she
has personal knowledge about the transaction. Apart from
that there must be specific assertions as to the knowledge of
the power of attorney holder regarding alleged transaction
explicitly the complaint. In the instant case, there is no
assertion in the complaint regarding PW.1 had personal
knowledge about the alleged transaction. In other words,
there is no averment in the complaint regarding at the time
of advancing the amount mentioned in the complaint, PW.2
was also present. That apart PW.2 has produced Special
Power of Attorney which has been marked as Ex.P5. On
perusal of Ex.P5, this court do not find any single sentence
SCCH-2 18 C.C.No.414/2020
regarding PW.2 was also present at the time of alleged
transaction, hence she had personal knowledge to prosecute
he case. As such he has been executing power of attorney in
favour of his wife namely Swetha ie., PW.2. In the absence of
specific assertion in the complaint regarding personal
knowledge of the PW.2, it can be inferred that PW.2 had no
personal knowledge about the transaction. Therefore the
decision of the Hon’ble Apex Court referred to above is aptly
applicable to the case on hand.
25. Further, the accused has disputed the alleged
transaction. At the cost of repetition, there is no assertion
regarding PW.2 has the personal knowledge about the
alleged transaction. Under such circumstances it is
bounden duty of the PW.1 to appear before this court in
order to offer himself for cross examination from the side of
accused. Though there is a denial of alleged transaction, the
complainant/PW.1 failed to appear before this court. Non
entering the witness box by PW.1 for the purpose of cross
examination from the side of accused is fatal to the case of
complainant.
26. Besides the above referred aspects, according to the
complaint averments, he has paid Rs.7,30,000/- to the
accused on two occasions. On both occasions the
SCCH-2 19 C.C.No.414/2020
complainant has allegedly advanced the amount in cash and
he has not taken any documents. Further, the accused has
not executed any agreement to sell in favour of complainant.
Normally any prudent man without getting agreement to sell
cannot advance money. Admittedly, Rs.7,30,000/- is not a
small amount. On the other hand it was a huge amount.
Such being the case question of advancing huge amount
without taking document creates doubt in the mind of this
court.
27. At this juncture, it is worth to rely on the decision
of Hon’ble Apex Court reported in (2020) 12 SCC 724
between APS Forex Services Pvt., Ltd., Vs. Shakti
International Fashion Linkers and Ors., wherein the
Hon’ble Apex Court held as follows:
“We are of the view that
whenever the accused has questioned
the financial capacity of the
complainant in support of his
probable defence, despite the
presumption under Section 139 of
the N.I. Act about the presumption of
legally enforceable debt and such
presumption is rebuttable, thereafter
the onus shifts again on the
complainant to prove his financial
capacity and at that stage the
SCCH-2 20 C.C.No.414/2020complainant is required to lead the
evidence to prove his financial
capacity, more particularly when it is
a case of giving loan by cash and
thereafter issuance of a cheque.”
28. Learned counsel for the complainant would submit
that during the course of cross examination of DW1, he has
admitted the filing of various cases and conviction passed
against him. It is true that accused has convicted in other
cases. It is relevant to note that the accused himself has
produced Ex.D1 to Ex.D7. The said documents shows that
the mother of PW.2, sister of PW.2, relative of PW.2 and other
persons have issued legal notice to the accused. Apart from
that, during the course of cross-examination of DW.1, the
learned counsel for complainant put a suggestion that Ex.D1
to Ex.D7 are no way related to the present case. By applying
the same principle, the conviction passed against the
accused will not inure to the benefit of complainant.
29. Apart from the above referred aspects, the accused
has produced Ex.D1 to Ex.D7. These documents are the
legal notices issued by the various persons to the accused.
During the course of cross-examination of PW.2, PW.2 has
clearly admitted that Shakunthala is her mother, Asha
Nagaraj is her elder sister and one Sri Shankar is her relative
SCCH-2 21 C.C.No.414/2020
through her father. It is interesting to note that the mother
of PW.2 has issued legal notices to the accused as per Ex.D3
& Ex.D4. As per Ex.D3, the mother of complainant alleged
that she had paid Rs.15,25,000/- to the accused on various
dates and as per Ex.D4 again the mother of complainant
alleged that she had paid Rs.5,25,000/- to the accused.
Further as per Ex.D1, the elder sister of complainant
demanded for Rs.5,00,000/-. As per Ex.D5 the relative of
PW.2 demanded for Rs.5,00,000/-. On careful perusal of
these documents, it appears to this court that various
persons have issued legal notices to the accused. Such being
the case, why the complainant had advanced Rs.7,30,000/-
on two occasions without taking sufficient security is not
forth coming. The said aspect is fatal to the case of the
complainant and also creates doubt about the alleged
advance of Rs.7,30,000/- to the accused.
30. At the cost of repetition when the accused has
disputed the very transaction, under such circumstances, it
is the primary duty of the PW.1 is to appear before this court
and offer himself for cross-examination from the side of
accused. Therefore non stepping of PW.1 into the witness
box for the purpose of cross examination from the side of
accused is fatal and creates doubt about the alleged
transaction. Though the presumption favours the
SCCH-2 22 C.C.No.414/2020
complainant, however the same would not come to the
rescue of complainant in the present case. Likewise in the
absence of personal knowledge, examination of PW.2 as a
power of attorney holder of PW.l also will not come to the aid
of complainant to establish his case. With the discussions
referred to above, this court has come to the conclusion that
the complainant has failed to establish the case. Accordingly
point No.1 is answered in the Negative.
31. POINT No.2:- In view of the discussions referred to
above, this Court proceeds to pass the following:
:: O R D E R ::
Acting U/Sec.255(1) Cr.P.C., the
accused is acquitted for the offence
punishable under Section 138 of
Negotiable Instruments Act, 1881.
The bail bond of the accused shall
stands cancelled.
(Dictated to the stenographer directly on computer, typed by her,
revised and corrected by me, and then pronounced in the open
Court on this the 22nd July, 2025)(H.P. Mohan Kumar)
VI Addl. Judge and ACJM.,
Court of Small Causes,
Bengaluru.
SCCH-2 23 C.C.No.414/2020
:ANNEXURE:
LIST OF WITNESSES EXAMINED BY THE COMPLAINANT:
P.W.1 : Sri. Shreyas Aithya. P.W.2 : Smt. Swetha A.A. LIST OF DOCUMENTS MARKED ON BEHALF OF COMPLAINANT: Ex.P.1 : Original Cheque No.362788 dated:22.07.2019. Ex.P.1(a) : Signature of the accused. Ex.P.2 : Bank endorsement dated:04.10.2019. Ex.P.3 : Office copy of legal notice dated:02.11.2019. Ex.P.3(a) : Postal receipt Ex.P.4 : Acknowledgment due card Ex.P.5 : Special Power of Attorney dated:27.05.2022. Ex.P5(a) : Signature of the complainant on SPA.
LIST OF WITNESSES EXAMINED BY THE ACCUSED:
D.W.1 : Sri. Krishnappa.
SCCH-2 24 C.C.No.414/2020
LIST OF DOCUMENTS MARKED ON BEHALF OF ACCUSED:
Ex.D.1 to D7 Copy of legal notices issued to accused
Digitally signed by H
HP P MOHANKUMAR
MOHANKUMAR Date: 2025.07.23
10:54:09 +0530(H.P. Mohan Kumar)
VI Addl. Judge and ACJM.,
Court of Small Causes,
Bengaluru.
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