Karnataka High Court
Sri Suresh Y vs Sri Raju S B on 18 July, 2025
Author: Shivashankar Amarannavar
Bench: Shivashankar Amarannavar
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CRL.RP No. 1032 of 2019
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 18TH DAY OF JULY, 2025
BEFORE
THE HON'BLE MR. JUSTICE SHIVASHANKAR AMARANNAVAR
CRIMINAL REVISION PETITION No. 1032 OF 2019
BETWEEN:
SRI SURESH Y
SON OF LATE YANGANNA
AGED ABOUT 50 YEARS
No. 62/1 KRISHNA NILAYA
8TH CROSS, SAMPANGIRAMANAGARA
BENGALURU - 560 026.
AND ALSO AT:
RAKSHITH'S HOT CHIPS
No. 61, NANDANAVANA
E STREET, JOGU PALYA
Digitally signed by HALASURU
LAKSHMINARAYANA
MURTHY RAJASHRI BENGALURU - 560 008.
Location: HIGH ...PETITIONER
COURT OF
KARNATAKA
(BY SRI S VENUGOPALA, FOR
SRI SRINIVASA T P, ADVOCATES)
AND:
SRI RAJU S B
SON OF SRI BYREGOWDA
AGED ABOUT 43 YEARS
RESIDING AT No. 71, 7TH CROSS
CUBBONPET MAIN ROAD
BENGALURU - 560 002.
...RESPONDENT
(BY SRI OMKAR BASAVA PRABHU, FOR
SRI R SRINIVAS, ADVOCATES)
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THIS CRL.RP IS FILED UNDER SECTION 397 READ WITH
SECTION 401 Cr.P.C PRAYING TO SET ASIDE THE JUDGMENT AND
ORDER DATED 09.07.2019 PASSED IN CRIMINAL APPEAL No.
838/2018 BY THE HON'BLE LXIII ADDITIONAL CITY CIVIL AND
SESSION JUDGE (CCH:64), BENGALURU, AND ALSO SET ASIDE
THE JUDGMENT AND ORDER OF SENTENCE DATED 16.04.2018
PASSED IN C.C.No.11764/2017 ON THE FILE OF THE XIII
ADDITIONAL CHIEF METROPOLITAN MAGISTRATE, BENGALURU.
THIS PETITION COMING ON FOR FINAL HEARING THIS DAY,
ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE SHIVASHANKAR AMARANNAVAR
ORAL ORDER
1. This criminal revision petition is directed against
the judgment dated 09.07.2019 passed in Crl.A. No.
838/2018 by the LXIII Additional City Civil and Sessions
Judge, Bengaluru, whereunder the judgment of conviction
dated 16.04.2018 passed in C.C. No. 11764/2017 by the XIII
ACMM, Bengaluru, convicting the petitioner – accused for
offence under Section 138 of Negotiable Instruments Act
(hereinafter for the sake of brevity referred to as the `N.I.
Act‘) and sentencing to pay fine of Rs.7,50,000/- and in
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default, to undergo simple imprisonment for six months has
been affirmed.
2. Heard learned counsel for petitioner and learned
counsel for respondent.
3. Case of the prosecution before the trial Court was
that the complainant and accused were known to each other
since several years and petitioner – accused was taking
financial assistance from respondent – complainant whenever
he needed. Accordingly on 10.05.2016 petitioner – accused
had approached respondent – complainant for hand loan of
Rs.6,00,000/-. Respondent – complainant had advanced
Rs.6,00,000/- to petitioner – accused on 11.05.2016.
Petitioner – accused, in order to repay the amount borrowed
had issued two cheques, bearing Nos. 321315 dated
28.10.2016 for a sum of Rs.3,00,000/- and 926936 dated
28.10.2016 for a sum of Rs.3,00,000/- both drawn on Canara
Bank, Halsuru Branch, Bengaluru. Respondent – complainant
presented the said cheques for encashment and they came to
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dishonoured for the reason `funds insufficient’ on
25.01.2017. Respondent – complainant got issued legal
notice 01.02.2017 and the same was duly served on
petitioner – accused on 03.02.2017 and 04.02.2017. Inspite
of service of notice, petitioner – accused had not paid amount
of two cheques within 15 days. Therefore, respondent –
complainant had initiated proceedings against petitioner –
accused under Section 138 of N.I. Act. Respondent –
complainant examined himself as P.W.1 and got marked
Ex.P.1 to Ex.P.12. Statement of petitioner – accused was
recorded under Section 313 of Cr.P.C. Petitioner – accused
has not let in any defence evidence. The trial Court, after
hearing arguments on both sides and appreciating the
evidence on record, has convicted the petitioner – accused for
offence under Section 138 of N.I. Act and sentenced as noted
supra. Said judgment of conviction and order on sentence
was challenged before the Sessions Court in Crl.A. No.
838/2018 and the said appeal came to be dismissed on
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merits affirming the judgment of conviction and order on
sentence passed by the trial Court.
4. Learned counsel for petitioner would contend that
it was the defence of petitioner – accused that cheques had
been given to one Rajanna as security for the amount
borrowed by him and the same have been misused by the
respondent – complainant. He further submits that
respondent – complainant has no capacity to lend huge
amount. Documents produced, which are at Ex.P.11 – rent
agreement and Ex.P.12 – bank statement, does not pertain
to the year of transaction. Therefore, respondent –
complainant has failed to prove his capacity. On the grounds
urged, learned counsel for petitioner has placed reliance on
the following decisions.
I. Adam Vs. Jayamala P. Shetty, Crl.R.P.No.
1302/2009 decided on 05.01.2024
II. Ans Rajashekar Vs. August Jeba Ananth, AIR 2019
SC 942
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III. John K. Abraham Vs. Simon C Abraham and
another, (2014) 2 SCC 236
IV. Rangappa Vs. Mohan, AIR 2010 SC 1898
V. Krishna Janardhan Bhat Vs. Dattatraya G. Heggade,
AIR 2008 SC 1325.
On these grounds, he prayed for allowing the revision petition
and acquitting the petitioner – accused.
5. Learned counsel for respondent would contend
that the trial Court, on appreciating the evidence on record,
has rightly convicted the petitioner – accused and the
appellate Court has rightly re-appreciated the evidence and
affirmed the conviction order passed by the trial Court. He
further submits that power of revision can be exercised only
if it is shown that there is glaring error or mistake committed
by the trial Court and the appellate Court. He further submits
that trial Court considering that the presumption under
Section 139 of N.I. Act remained unrebutted has rightly
convicted the petitioner – accused. On these grounds he
prayed for dismissal of the revision petition.
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6. Having heard learned counsel for petitioner and
learned counsel for respondent this Court has perused the
impugned judgments, trial Court records and appellate Court
records.
7. It is the specific case of respondent – complainant
that petitioner – accused had borrowed Rs.6,00,000/- from
him on 11.05.2016 and in order to repay the said amount he
had issued two cheques for Rs.3,00,000/- each dated
28.10.2016. Said two cheques, on presentment, came to
dishonoured for the reason `funds insufficient’. Petitioner –
accused has admitted his signature on the cheques – Ex.P.1
and Ex.P.2. As signature on the cheques is admitted, a
presumption has to be drawn under Section 139 of N.I. Act
that the cheques are issued for discharge of debt. Said
presumption is a rebuttable presumption. Standard of proof
for rebutting the said presumption is preponderance of
probability.
8. Petitioner – accused has not got issued any reply
to the legal notice inspite of service of said legal notice
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putting forth his defence. Petitioner – accused had taken up
a defence in the cross-examination of P.W.1. Said defence
has been put to P.W.1 in his cross-examination. Defence of
petitioner – accused in the cross-examination of P.W.1 is that
petitioner – accused had borrowed money from Rajanna and
given cheques as security for the amount borrowed and said
cheques have been misused by respondent – complainant. In
regard to the said defence certain suggestions were put to
P.W.1 in his cross-examination. P.W.1 has denied the said
suggestions. Except the said suggestions there are no
material placed on record to establish the said defence.
Therefore, petitioner – accused has failed to rebut the
presumption drawn under Section 139 of N.I. Act.
Consequence of non-rebuttal of presumption drawn under
Section 139 of N.I. Act has been considered by the Hon’ble
Apex Court in the case of Kalamani tex and Another Vs. P
Balasubramanian, reported in 2021 (5) SCC 283 and has
held as under:
“13. Adverting to the case in hand, we
find on a plain reading of its judgment that the
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trial Court completely overlooked the provisions
and failed to appreciate the statutory
presumption drawn under Section 118 and
Section 139 of NIA. The Statute mandates that
once the signature(s) of an accused on the
cheque/negotiable instrument are established,
then these ‘reverse onus’ clauses become
operative. In such a situation, the obligation
shifts upon the accused to discharge the
presumption imposed upon him. This point of
law has been crystalized by this Court in
Rohitbhai Jivanlal Patel v. State of Gujarat in the
following words:
“18. In the case at hand, even after
purportedly drawing the presumption
under Section 139 of the NI Act, the trial
court proceeded to question the want of
evidence on the part of the complainant as
regards the source of funds for advancing
loan to the accused and want of
examination of relevant witnesses who
allegedly extended him money for
advancing it to the accused. This approach
of the trial court had been at variance with
the principles of presumption in law. After
such presumption, the onus shifted to the
accused and unless the accused had
discharged the onus by bringing on record
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such facts and circumstances as to show
the preponderance of probabilities tilting in
his favour, any doubt on the complainant’s
case could not have been raised for want
of evidence regarding the source of funds
for advancing loan to the appellant
accused.”
9. The Hon’ble Apex Court in the case of Rajesh
Jain Vs. Ajay Singh reported in AIR Online 2023 SC 807
has held as under:
“55. As rightly contended by the appellant,
there is a fundamental flaw in the way both the
Courts below have proceeded to appreciate the
evidence on record. Once the presumption under
Section 139 was given effect to, the Courts
ought to have proceeded on the premise that the
cheque was, indeed, issued in discharge of a
debt/liability. The entire focus would then
necessarily have to shift on the case set up by
the accused, since the activation of the
presumption has the effect of shifting the
evidential burden on the accused. The nature of
inquiry would then be to see whether the
accused has discharged his onus of rebutting the
presumption. If he fails to do so, the Court can
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straightaway proceed to convict him, subject to
satisfaction of the other ingredients of Section
138. If the Court finds that the evidential burden
placed on the accused has been discharged, the
complainant would be expected to prove the said
fact independently, without taking aid of the
presumption. The Court would then take an
overall view based on the evidence on record
and decide accordingly.”
10. Learned counsel for petitioner – accused would
contend that the respondent – complainant has not proved
his financial capacity and on that point he placed reliance on
the decision of this Court in the case of Adam (supra)
which has been passed based on the judgment of the Hon’ble
Apex Court in the case of Tedhi Sing Vs. Narayan Das
Mahant reported in 2022 SCC Online Sc 302. Learned
counsel for petitioner also placed reliance on the decision of
the Hon’ble Apex Court in the case of John K. (supra) on
the same point.
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11. Hon’ble Apex Court in the recent decision in the
case of Ashok Singh Vs. State of Uttar Pradesh and
another reported in 2025 LiveLaw (SC) 383 by referring
to the decision in Bir Singh Vs. Mukesh Kumar, reported in
(2019) 4 SCC 197, Rohitbhai Jivanlal Patil Vs. State of
Gujarat, reported in 2019 (18) SCC 106 and John K.
John Vs. Tom Varghese reported in (2007) 12 SCC 715
has held that the complainant has no onus to prove financial
capacity at the threshold. Once the drawer admits signing the
cheque, the presumption under Section 139 of N.I. Act
cannot be rebutted merely by questioning the complainant’s
debt giving capacity, especially when such a defence was not
raised in the reply notice by the accused. In the said decision
the Hon’ble Apex Court has observed thus:
“21. One of the grounds, which weighed heavily
with the High Court to acquit the respondent no.2 was
that the appellant was unable to prove the source of
Rs.22,00,000/- (Rupees Twenty-Two Lakhs) given to
the respondent no.2 as loan. Admittedly, the signature
on the cheque is of the respondent no.2 himself. The
decision in Rohitbhai Jivanlal Patel v. State of
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Gujarat, (2019) 18 SCC 106 can be profitably
referred to:
’18. In the case at hand, even after
purportedly drawing the presumption
under Section 139 of the NI Act, the trial
court proceeded to question the want of
evidence on the part of the complainant
as regards the source of funds for
advancing loan to the accused and want
of examination of relevant witnesses
who allegedly extended him money for
advancing it to the accused. This
approach of the trial court had been at
variance with the principles of
presumption in law. After such
presumption, the onus shifted to the
accused and unless the accused had
discharged the onus by bringing on
record such facts and circumstances as
to show the preponderance of
probabilities tilting in his favour, any
doubt on the complainant’s case could
not have been raised for want of
evidence regarding the source of funds
for advancing loan to the appellant-
accused. The aspect relevant for
consideration had been as to whether
the appellant-accused has brought on
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record such
facts/material/circumstances which
could be of a reasonably probable
defence.
19. In order to discharge his burden, the
accused put forward the defence that in fact,
he had the monetary transaction with the said
Shri Jagdishbhai and not with the
complainant. In view of such a plea of the
appellant- accused, the question for
consideration is as to whether the appellant-
accused has shown a reasonable probability
of existence of any transaction with Shri
Jagdishbhai? In this regard, significant it is
to notice that apart from making certain
suggestions in the cross-examination,
the appellant-accused has not adduced
any documentary evidence to satisfy even
primarily that there had been some monetary
transaction of himself with Shri Jagdishbhai.
Of course, one of the allegations of the
appellant is that the said stamp paper was
given to Shri Jagdishbhai and another factor
relied upon is that Shri Jagdishbhai had
signed on the stamp paper in question and
not the complainant.
xxx
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20. Hereinabove, we have examined in
detail the findings of the trial court and those
of the High Court and have no hesitation in
concluding that the present one was clearly a
case where the decision of the trial court
suffered from perversity and fundamental
error of approach; and the High Court was
justified in reversing the judgment of the trial
court. The observations of the trial court
that there was no documentary evidence
to show the source of funds with the
respondent to advance the loan, or that
the respondent did not record the
transaction in the form of receipt of even
kachcha notes, or that there were
inconsistencies in the statement of the
complainant and his witness, or that the
witness of the complaint was more in the
know of facts, etc. would have been
relevant if the matter was to be
examined with reference to the onus on
the complaint to prove his case beyond
reasonable doubt. These considerations
and observations do not stand in
conformity with the presumption existing
in favour of the complainant by virtue
of Sections 118 and 139 of the NI Act.
Needless to reiterate that the result of
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such presumption is that existence of a
legally enforceable debt is to be
presumed in favour of the complainant.
When such a presumption is drawn, the
factors relating to the want of
documentary evidence in the form of
receipts or accounts or want of evidence
as regards source of funds were not of
relevant consideration while examining if
the accused has been able to rebut the
presumption or not. The other observations
as regards any variance in the statement of
complainant and witness; or want of
knowledge about dates and other particulars
of the cheques; or washing away of the
earlier cheques in the rains though the office
of the complainant being on the 8th floor had
also been irrelevant factors for consideration
of a probable defence of the appellant.
Similarly, the factor that the complainant
alleged the loan amount to be Rs 22,50,000
and seven cheques being of Rs 3,00,000 each
leading to a deficit of Rs 1,50,000, is not even
worth consideration for the purpose of the
determination of real questions involved in
the matter. May be, if the total amount of
cheques exceeded the alleged amount of
loan, a slender doubt might have arisen, but,
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in the present matter, the total amount of 7
cheques is lesser than the amount of loan.
Significantly, the specific amount of loan (to
the tune of Rs 22,50,000) was distinctly
stated by the appellant- accused in the
aforesaid acknowledgment dated 21-3-
2017.”
22. The High Court while allowing the criminal revision
has primarily proceeded on the presumption that it
was obligatory on the part of the complainant to
establish his case on the basis of evidence by giving
the details of the bank account as well as the date and
time of the withdrawal of the said amount which was
given to the accused and also the date and time of the
payment made to the accused, including the date and
time of receiving of the cheque, which has not been
done in the present case. Pausing here, such
presumption on the complainant, by the High Court,
appears to be erroneous. The onus is not on the
complainant at the threshold to prove his
capacity/financial wherewithal to make the payment in
discharge of which the cheque is alleged to have been
issued in his favour. Only if an objection is raised that
the complainant was not in a financial position to pay
the amount so claimed by him to have been given as a
loan to the accused, only then the complainant would
have to bring before the Court cogent material to
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indicate that he had the financial capacity and had
actually advanced the amount in question by way of
loan. In the case at hand, the appellant had
categorically stated in his deposition and reiterated in
the cross-examination that he had withdrawn the
amount from the bank in Faizabad (Typed Copy of his
deposition in the paperbook wrongly mentions this as
‘Firozabad’). The Court ought not to have summarily
rejected such stand, more so when respondent no.2
did not make any serious attempt to dispel/negate
such stand/statement of the appellant. Thus, on the
one hand, the statement made before the Court, both
in examination-in-chief and cross- examination, by the
appellant with regard to withdrawing the money from
the bank for giving it to the accused has been
disbelieved whereas the argument on behalf of the
accused that he had not received any payment of any
loan amount has been accepted. In our decision in
M/s S. S. Production v. Tr. Pavithran Prasanth,
2024 INSC 1059, we opined:
‘8. From the order impugned, it is clear that
though the contention of the petitioners was
that the said amounts were given for
producing a film and were not by way of
return of any loan taken, which may have
been a probable defence for the petitioners in
the case, but rightly, the High Court has taken
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the view that evidence had to be adduced on
this point which has not been done by the
petitioners. Pausing here, the Court would
only comment that the reasoning of the High
Court as well as the First Appellate Court and
Trial Court on this issue is sound. Just by
taking a counter-stand to raise a probable
defence would not shift the onus on the
complainant in such a case for the plea of
defence has to be buttressed by evidence,
either oral or documentary, which in the
present cases, has not been done.
Moreover, even if it is presumed that the
complainant had not proved the source of
the money given to the petitioners by
way of loan by producing statement of
accounts and/or Income Tax Returns, the
same ipso facto, would not negate such
claim for the reason that the cheques
having being issued and signed by the
petitioners has not been denied, and no
evidence has been led to show that the
respondent lacked capacity to provide the
amount(s) in question. In this regard, we
may make profitable reference to the decision
in Tedhi Singh v Narayan Dass Mahant,
(2022) 6 SCC 735:’10. The trial court and
the first appellate court have noted that in the
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case under Section 138 of the NI Act the
complainant need not show in the first
instance that he had the capacity. The
proceedings under Section 138 of the NI
Act is not a civil suit. At the time, when
the complainant gives his evidence,
unless a case is set up in the reply notice
to the statutory notice sent, that the
complainant did not have the
wherewithal, it cannot be expected of the
complainant to initially lead evidence to
show that he had the financial capacity.
To that extent, the courts in our view
were right in holding on those lines.
However, the accused has the right to
demonstrate that the complainant in a
particular case did not have the capacity
and therefore, the case of the accused is
acceptable which he can do by producing
independent materials, namely, by
examining his witnesses and producing
documents. It is also open to him to
establish the very same aspect by
pointing to the materials produced by the
complainant himself. He can further,
more importantly, achieve this result
through the crossexamination of the
witnesses of the complainant. Ultimately,
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it becomes the duty of the courts to
consider carefully and appreciate the
totality of the evidence and then come to
a conclusion whether in the given case,
the accused has shown that the case of
the complainant is in peril for the reason
that the accused has established a
probable defence.’
(emphasis supplied)’ (underlining in
original;emphasis spplied by us in bold)
12. In the case of Krishna Janardhan Bhat (supra) the
presumption drawn under Section 139 of N.I. Act has been
rebutted and therefore burden of proving transactions has
been shifted to complainant. In the case on hand
presumption under Section 139 has not been rebutted,
therefore, said decision does not apply to present case.
13. Considering the said aspect there is no necessity
of respondent – complainant proving his financial capacity as
the presumption drawn under Section 139 of the N.I. Act
remained unrebutted. Considering all these aspects learned
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Magistrate has rightly convicted petitioner – accused for
offence under Section 138 of the N.I. Act and the appellate
Court has rightly re-appreciated and affirmed the order on
sentence and judgment of conviction. There are no grounds
to allow this revision petition. Hence, revision petition is
dismissed.
Sd/-
(SHIVASHANKAR AMARANNAVAR)
JUDGE
LRS
List No.: 1 Sl No.: 57
Ct.sm
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