Bangalore District Court
Lokesh G vs Nagaraju B.M on 22 January, 2025
KABC0C0244892023
IN THE COURT OF XIV ADDL.CHIEF JUDICIAL
MAGISTRATE, MAYOHALL UNIT, BENGALURU
Dated this the 22nd day of January, 2025
Present: Sri.SANTHOSH S.KUNDER., B.A.,LL.M.,
XIV Addl. C.J.M., Bengaluru.
JUDGMENT UNDER SECTION 355 of Cr.P.C
C.C.No.58453/2023
Sri.Lokesh.G.,
Complainant: S/o M.Govindaraju,
Aged about 42 years,
R/at No.33, Horamavu Agra,
Near Bust Stop, Horamavu Post,
Bengaluru-560043.
(By Sri. B.Roopesha,
M.K Sandeep &
Siddalingappa C.C., Advocates)
V/s
Accused Sri.Nagaraju.B.M,
S/o Mudalagiriyappa,
Aged about 47 years,
R/at Byrapura Village,
Kuppalu Post, Tiptur Taluk,
Tiptur, Tumkur District-572 201.
Working as
Driver-Cum-Conductor
at BMTC Depot No.23,
Hennur, Kalyan Nagar Depot,
Kalyan Nagar Post,
Bengaluru-560043.
(By Sri.C.P.Puttaraja, Advocate)
Offence U/s 138 of Negotiable Instruments Act
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Plea of the Pleaded not guilty
accused
Final Order Accused is held guilty & convicted
This complaint is filed under Section 200 of Cr.P.C,
for the offence punishable under Section 138 of the
Negotiable Instruments Act.
2. Complaint averments in brief:-
2.1. Complainant and accused are working as
Driver-Cum-Conductors in BMTC, Depot No.23, Kalyan
Nagar, Bengaluru. As such, both are well acquainted.
Accused used to borrow hand loan from the complainant
for his domestic purpose and used to return the same. On
08.09.2021, the accused approached the complainant for
hand loan of ₹3,00,000/-. Since, the complainant had
good relationship with the accused, he had lent a sum of
₹3,00,000/- to the accused through cheque bearing
No.928714, drawn at Karnataka Bank, Banaswadi
Branch, Bengaluru. The accused has assured to repay the
same within 2 years with interest @ 0.5% per month.
Again on 28.09.2021, he has approached the complainant
for hand loan of ₹3,00,000/- assuring repayment within
02 years with interest @ 0.5% per month. The
complainant has again lent said sum of ₹3,00,000/- to
the accused on the same day by cash. Thus, in all a sum
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of ₹6,00,000/- was lent by the complainant to the
accused.
2.2. The accused was promptly paying interest as
agreed till December, 2022. But, January, 2023 on wards,
he has stopped paying interest. When the complainant
approached him and demanded to pay the interest, the
accused has expressed his inability to pay the interest due
to financial crisis and assured that, he will return the
entire amount of ₹6,00,000/- within five months.
Believing his words, the complainant had kept quite till
May, 2023. During last week of May, 2023, the accused
issued a cheque bearing No.039281 dated 01.06.2023,
drawn on State Bank of India, Hennur Road Branch,
Bengaluru to the complainant and assured that the
cheque will be honored on its presentation.
2.3. On 05.06.2023, the complainant presented the
said cheque through his bank, viz., Karnataka Bank Ltd.,
Banaswadi Branch, Bengaluru. But, it was returned with
an endorsement 'exceeds arrangement'. After receiving of
endorsement on 09.06.2023, the complainant contacted
the accused and informed him about dishonor. But, he
gave evasive answers. Left with no other alternative, the
complainant issued a legal notice on 27.06.2023 calling
upon the accused to pay the cheque amount. The notice
sent to his residential address served on 03.07.2023,
whereas, notice sent to his place of work returned
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unserved. The accused has neither paid the cheque
amount nor replied the notice. Therefore, this complaint is
filed.
3. This court took cognizance of the offence
punishable under Section 138 of N.I.Act. Sworn statement
of the complainant recorded. Documents at Ex.P-1 to 10
marked for the complainant. As there were prima facie
materials, criminal case was registered and accused was
summoned.
4. Pursuant to the summons, accused has
appeared before the court and got enlarged on bail. After
compliance of Sec.207 of Cr.P.C, this court recorded his
plea by reading over the substances of accusation. He has
pleaded not guilty and claimed to be tried. On the same
day, his statement under Section 313 of Cr.P.C. recorded.
He has denied the incriminating evidence.
5. Evidence of complainant recorded during pre-
summoning stage treated as complainant has adopted his
evidence recorded during pre-summoning stage. In
defence, he has examined himself as DW-1 and got
marked documents at Ex.D-1 to 3.
6. Heard both side.
7. Points for consideration:-
1. Whether the complainant proved that
the accused has drawn cheque bearing
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No.039281 dtd.01.06.2023 for
₹6,00,000/-, on State Bank of India,
Hennur Road Branch, Bengaluru and on
presentation, it was dishonoured for the
reason "exceeds arrangement" as per
memo dated 09.06.2023 and in spite of
service of legal notice dated 27.06.2023,
he has failed to pay the cheque amount
and thereby he has committed the offence
punishable under Section 138 of N.I.Act?
2. What order?
8. The above points are answered as under:-
Point No.1 : In the Affirmative
Point No.2 : As per final order for the following:
REASONS
9. Point No.1:- To prove the case, the complainant has
examined himself as PW-1 and reiterated the complaint
averments in his affidavit, filed in lieu of oral examination-
in-chief and got marked as many as ten documents at
Ex.P-1 to 10. Ex.P-1 is the cheque; Ex.P-2 is the bank
endorsement; Ex.P-3 is copy of the legal notice dated
27.06.2023; Ex.P-4 and 5 are the postal receipts; Ex.P-6
is postal acknowledgment card; Ex.P-7 is postal cover;
Ex.P-8 is copy of letter dated 15.09.2023 addressed to
Post Master, CMM Court Complex post office, Bengaluru;
Ex.P-9 is postal track consignment report and Ex.P-10 is
bank statement of the complainant.
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10. Of documents marked for the accused, Ex.D1
is legal notice dated 21.06.2024 sent by the accused to
the complainant; Ex.D2 is postal receipt and Ex.D3 is
returned postal cover.
11. The version of the complainant is that he has
lent hand loan of ₹6,00,000/- to the accused. He is
contending that, he has paid ₹3,00,000/- by way of
cheque bearing No.928714, drawn on Karnataka Bank
Ltd., Banaswadi Branch, Bengaluru and remaining
₹3,00,000/- by way of cash on 28.09.2021. According to
the complainant, it is towards repayment of said debt of
₹6,00,000/-, the accused has drawn the cheque in
question which was dishonored on presentation with
endorsement dated 09.06.2023 to the effect that 'exceeds
arrangement' and that the accused has failed to pay the
cheque amount in spite of service of demand notice on
him. To substantiate the said contention, the complainant
has offered his evidence and produced the documents at
Ex.P1 to 10.
12. Learned counsel for the accused cross-
examined PW-1. During cross-examination dated
03.07.2024, a suggestion was put to PW-1 to the effect
that the accused has returned the entire hand loan that
was lent on 08.09.2021 through cheque. PW-1 has denied
the said suggestion. Relevant portion of his evidence is
extracted as under:-
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" XXXXX ದಿ.08.09.2021 ರಂದು ಆರೋಪಿಗೆ
ನಾನು ಚೆಕ್ ಮೂಲಕ ಕೊಟ್ಟ ಹಣವನ್ನೆಲ್ಲಾ ಆರೋಪಿಯು
ನನಗೆ ವಾಪಾಸ್ಸು ಕೊಟ್ಟಿದ್ದಾರೆ ಎಂದರೆ ಸರಿಯಲ್ಲ.
ಡಿಸೆಂಬರ್ 2022 ರಲ್ಲಿ ಸಂಪೂರ್ಣ ಹಣವನ್ನು ಆರೋಪಿಯು
ನನಗೆ ವಾಪಾಸ್ಸು ಕೊಟ್ಟಿದ್ದಾರೆ ಎಂದರೆ ಸರಿಯಲ್ಲ.
XXXXX "
13. By way of above suggestion given to PW-1 by
the accused during cross-examination, the accused has
impliedly admitted that he has borrowed hand loan of
₹3,00,000/- from the complainant on 08.09.2021.
Further, in cross examination dated 12.07.2024 the
accused admitted that he has borrowed hand loan of
₹3,00,000/- from the complainant on 08.09.2021.
Relevant portion of evidence of PW-1 is extracted as
under:-
"XXXXX ದಿ.08.09.2021 ರಂದು ಮಾತ್ರ ನಾನು
ಆರೋಪಿಗೆ ರೂ.3,00,000/-ಗಳನ್ನು ಕೊಟ್ಟಿದ್ದೆ ಎಂದರೆ
ಸರಿಯಲ್ಲ. ಆ ಸಂದರ್ಭದಲ್ಲಿ ಆರೋಪಿಯಿಂದ ನಾನು ನಿಪಿ.1
ಮತ್ತು ಚೆಕ್ ಸಂಖ್ಯೆ 039282 ಗಳನ್ನು ನಾನು ಭದ್ರತೆಗಾಗಿ
ಪಡೆದಿದ್ದೆ ಎಂದರೆ ಸರಿಯಲ್ಲ. ಅವರು ನನಗೆ ಒಂದೇ ಚೆಕ್ಕನ್ನು
ಕೊಟ್ಟಿದ್ದಾರೆಂದು ಸಾಕ್ಷಿಯು ಹೇಳುತ್ತಾರೆ. ರೂ.3,00,000/-
ಗಳನ್ನು ನಾನು ಆರೋಪಿಗೆ ಕೊಟ್ಟ ದಿನ ಚೆಕ್ಕುಗಳ ಜೊತೆ
ಭದ್ರತೆಗಾಗಿ ತಿಪಟೂರಿನ ನಿವೇಶನದ ಮೂಲ ಕ್ರಯ ಪತ್ರವನ್ನು
ನಾನು ಆತನಿಂದ ಪಡೆದಿದ್ದೇನೆಂದರೆ ಸರಿಯಲ್ಲ."
14. From the questions/suggestions put to PW-1
in his cross-examination it can be gathered that the
accused has taken a defence that the subject cheque and
another cheque bearing No.039282 was issued towards
security for the loan. He is also denying the case of the
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complainant that he has received hand loan of
₹3,00,000/- from the complainant on 28.09.2021.
15. Coming to the evidence of DW-1, who has
deposed in his examination-in-chief to the following
effect:-
"ನನ್ನ ತಾಯಿಯ ಅನಾರೋಗ್ಯದ ಹಿನ್ನೆಲೆಯಲ್ಲಿ ದಿಃ
08.09.2021 ರಂದು ದೂರುದಾರರಿಂದ 3 ಲಕ್ಷ ರೂಗಳನ್ನು
ಚೆಕ್ ಮುಖಾಂತರ ಸಾಲವಾಗಿ ಪಡೆದಿದ್ದೇನೆ. ಆ ಸಾಲದ
ಭದ್ರತೆಗಾಗಿ ಚೆಕ್ ನಂ 039281 ಮತ್ತು 039282 ಹಾಗೂ
ನನ್ನ ಸ್ವಯಾರ್ಜಿತ ಸ್ವತ್ತಿನ ಕ್ರಯಪತ್ರವನ್ನು ದೂರುದಾರರರಿಗೆ
ಕೊಟ್ಟಿರುತ್ತೇನೆ. ಸಾಲದ ಬಾಬ್ತು ಬಡ್ಡಿ ಹಣವನ್ನು ಪ್ರತಿ ತಿಂಗಳು
10 ನೇ ತಾರೀಖಿನಂದು ದೂರುದಾರರಿಗೆ ಕೊಡುತ್ತಾ ಬಂದಿದ್ದೇನೆ.
ಡಿಸೆಂಬರ್ 2022 ರಲ್ಲಿ ಸಂಪೂರ್ಣ ಸಾಲದ ಮೊತ್ತವನ್ನು ಬಡ್ಡಿ
ಸಮೇತ ದೂರುದಾರರಿಗೆ ಮಂಜುನಾಥ್ ಎಂಬುವವರ
ಸಮ್ಮುಖದಲ್ಲಿ ಹಿಂತಿರುಗಿಸಿದ್ದೇನೆ. ನಾನು ದೂರುದಾರರಿಗೆ
ಮೊದಲೇ ಕೊಟ್ಟಿದ್ದ 2 ಖಾಲಿ ಚೆಕ್ಕುಗಳು ಮತ್ತು ಸ್ವತ್ತಿನ
ಕ್ರಯಪತ್ರವನ್ನು ಹಿಂತಿರುಗಿಸುವಂತೆ ಕೇಳಿದ್ದು , ಆ
ದಾಖಲಾತಿಗಳನ್ನು ವಾಪಸ್ಸು ಕೊಡದೇ ಕಾಲಹರಣ ಮಾಡುತ್ತಾ
ಬಂದಿದ್ದಾರೆ. ಅವರು ಚೆಕ್ಕುಗಳನ್ನು ದುರುಪಯೋಗ
ಮಾಡಿಕೊಂಡು ಈ ದೂರನ್ನು ಸಲ್ಲಿಸಿದ್ದಾರೆಂದು
ನ್ಯಾಯಾಲಯದಿಂದ ಸಮನ್ಸ್ ಬಂದಾಗ ನನಗೆ ಮನವರಿಕೆ
ಆಯಿತು. XXXXX "
16. Learned counsel for the complainant cross-
examined DW-1 and elicited that during September, 2021,
he had borrowed hand loan of ₹3,00,000/- from the
complainant. But, he had denied the suggestion that on
28.09.2021 accused had again borrowed hand loan of
₹3,00,000/- from the complainant in cash. He has also
denied the suggestion that, accused has issued the
subject cheque towards security for repayment of hand
loan of ₹6,00,000/-. He has reiterated that he has
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borrowed ₹3,00,000/- only. It is elicited that the accused
has received SMS from his banker regarding dishonor of
the cheque. He has also admitted that, he has received the
legal notice sent by the complainant. It is elicited that
after the filing of present complaint, he has issued notice/
reply dated 21.06.2024 marked at Ex.D1. Relevant portion
of evidence of DW-1 is extracted as under:-
"XXXX ನಿಪಿ.1 ಚೆಕ್ಕು ಅಮಾನ್ಯಗೊಂಡ ಬಗ್ಗೆ ನನಗೆ
ಮೊಬೈಲ್ ಸಂದೇಶ ಬಂದಿದೆ. ನಿಪಿ.1 ಚೆಕ್ಕು ಅಮಾನ್ಯಗೊಂಡ
ನಂತರ ದೂರುದಾರರು ನನ್ನ ಎರಡೂ ವಿಳಾಸಕ್ಕೆ ನಿಪಿ.3 ರಂತೆ
ನೋಟೀಸನ್ನು ಕಳುಹಿಸಿದ್ದಾರೆಂದರೆ, ಬೈರಾಪುರ ಗ್ರಾಮದ ನನ್ನ
ವಿಳಾಸಕ್ಕೆ ಕಳುಹಿಸಿದ ನೋಟೀಸು ಮಾತ್ರ ನನಗೆ ಜಾರಿಯಾಗಿದೆ
ಎಂದು ಸಾಕ್ಷಿಯು ಹೇಳುತ್ತಾರೆ. ನಿಪಿ.3 ನೋಟೀಸು ತಲುಪಿದ
ಒಂದು ತಿಂಗಳೊಳಗೆ ನಾನು ಅದಕ್ಕೆ ಉತ್ತರ ಕೊಟ್ಟಿಲ್ಲ ಎಂದರೆ
ಸರಿಯಲ್ಲ. ಈ ದೂರು ಸಲ್ಲಿಕೆಯಾಗಿ, ಚಾಲ್ತಿ ಇರುವಾಗ ನಾನು
ನೋಟೀಸಿಗೆ ದಿ.21.06.2024 ರಂದು ಉತ್ತರವನ್ನು
ಕೊಟ್ಟಿದ್ದೇನೆಂದರೆ ಸರಿ. XXXXX "
17. During further cross-examination of DW-1, he
is asserted that he has lodged complaint against the
complainant to the police inter alia complaining that his
two cheques and sale deed are with the complainant. But,
the police have not given acknowledgment to the same. It
is elicited that the accused has not filed private complaint
against the complainant.
18. Upon discussing the oral and documentary
evidence produced by either side, it is forthcoming that
the accused has admitted that he had borrowed hand loan
of ₹3,00,000/- from the complainant on 08.09.2021. But,
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he is denying the case of the complainant that on
28.09.2021 he had again borrowed hand loan of
₹3,00,000/-. According to the complainant, first hand
loan of ₹3,00,000/- was lent by way of cheque and 2 nd
hand loan of ₹3,00,000/- was lent by way of cash on
28.09.2021. Ex.P10 is the document upon which the
complainant is harping upon to contend that he had
advanced hand loan of ₹6,00,000/-. Entry dated
08.09.2021 in Ex.P10 shows that a sum of ₹3,00,000/-
was advanced by the complainant to the accused by
cheque bearing No. 928714. Admittedly, the said cheque
was encashed. Further, the entry dated 28.09.2021,
shows that the complainant has withdrawn a sum of
₹3,00,000/- by way of 'self' cheque No.928721. According
to the complainant, it was this amount which he had lent
to the accused on 28.09.2021. The bank account
statement proves the financial capacity of the
complainant. It is pertinent to note that the accused does
not dispute withdrawing of ₹3,00,000/- by the
complainant on 28.09.2021. However, it is his contention
that the money that was withdrawn by the complainant
on 28.09.2021 was used for his (complainant) personal
purpose. In this regard, suggestion was given to PW-1 in
cross-examination dated 12.07.2024 which reads as
under:-
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"ದಿ.28.09.2021 ರಂದು ಆರೋಪಿಗೆ ರೂ.3,00,000/-
ಗಳನ್ನು ಕೊಟ್ಟಿದ್ದೇನೆಂದು ಸುಳ್ಳು ಹೇಳುತ್ತಿದ್ದೇನೆಂದರೆ
ಸರಿಯಲ್ಲ. ಆ ಹಣವನ್ನು ನಾನು ಆ ದಿನ ಬ್ಯಾಂಕಿನಿಂದ ಡ್ರಾ ಮಾಡಿ
ಕೊಟ್ಟಿದ್ದೇನೆಂದು ಸುಳ್ಳು ಹೇಳುತ್ತಿದ್ದೇನೆಂದರೆ ಸರಿಯಲ್ಲ. ಆ
ದಿನ ನಾನು ರೂ.3,00,000/- ಗಳನ್ನು ನನ್ನ ಸ್ವಂತ ಬಳಕೆಗಾಗಿ
ಡ್ರಾ ಮಾಡಿದ್ದೇನೆಂದರೆ ಸರಿಯಲ್ಲ. XXXXX "
19. It significant to note that, after the dishonor of
the cheque, the complainant has issued a demand notice
to the accused as per Ex.P3. Admittedly, notice sent to the
residential address of the accused was served.
Indisputably, the accused has not replied to the said
notice. On the other hand, he has sent notice dated
21.06.2024 to the complainant, marked at EX.D1 during
the pendency of the present complaint contending that he
has borrowed hand loan of ₹3,00,000/- only and that at
the time of lending the said loan, the complainant has
taken two signed blank cheques and one original
registered sale deed pertaining to site bearing No.58,
Khatha No.47-504-88/58. It is pertinent to note that the
accused admits that cheque at Ex.P1 belongs to him and
that signature appearing on the cheque is also admitted
by him. Relevant portion in the cross-examination of DW-
1 reads as under:-
"ನಿಪಿ.1 ಚೆಕ್ಕು ನನ್ನ ಬ್ಯಾಂಕ್ ಖಾತೆಯದ್ದು ಎಂದರೆ ಸರಿ.
ನಿಪಿ.1(ಎ) ಸಹಿ ನನ್ನದೇ ಇರುತ್ತದೆಂದರೆ ಸರಿ. XXXXX "
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20. Section 138 of the Act provides that a drawer
of a cheque is deemed to have committed the offence if the
following ingredients are fulfilled:
(i) A cheque drawn for the payment of any
amount of money to another person;
(ii) The cheque is drawn for the discharge of
the "whole or part" of any debt or other
liability. "Debt or other liability" means legally
enforceable debt or other liability; and
(iii) The cheque is returned by the bank
unpaid because of insufficient funds.
However, unless the stipulations in the proviso are
fulfilled, the offence is not deemed to be committed. The
conditions in the proviso are as follows:
(i) The cheque must be presented in the bank
within six months from the date on which it
was drawn or within the period of its validity;
(ii) The holder of the cheque must make 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 from
the receipt of the notice from the bank that
the cheque was returned dishonoured; and
(iii) The holder of the cheque fails to make the
payment of the "said amount of money" within
fifteen days from the receipt of the notice.
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21. At this juncture, it is also necessary go
through the provisions contained in Section 118(a) and
139 of N.I.Act which are extracted as under:-
"Sec.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 of
transferred for consideration.
"Sec,139. Presumption in fvour 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, or any debt or
other liability."
22. Combined effect of Section 118(a) and Section
139 of N.I.Act raises a presumption in favour of the holder
of the cheque that he has received the same for discharge,
in whole or in part of any debt or other liability.
Presumptions contemplated under Section 118(a) and 139
of the N.I.Act are favour of the complainant. However, it is
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open to an accused to raise a defence to rebut the
statutory presumptions regarding existence of legally
enforceable debt or liability. It is also well established that
the accused for discharging the burden of proof placed
upon him under a statute, need not examine himself. He
may discharge his burden on the basis of the materials
already brought on record and the standard of proof so as
to prove a defence on the part of accused is
preponderance of probabilities.
23. For appreciating legal position, it is worth to
refer to the judgment of the Hon'ble Supreme Court in the
case of Hiten P.Dalal V.Bratindranath Banerjee: (2001)
6 SCC 16, wherein it was held that:
"22. Because both Sections 138 and
139 require that the Court "shall
presume" the liability of the drawer of
the cheques for the amounts for which
the cheques are drawn, as noted in
State of Madras vs.A.Vaidyanatha Iyer
AIR 1958 SC 61, it is obligatory on the
Court to raise this presumption in every
case where the factual basis for the
raising of the presumption had been
established. "It introduces an exception
to the general rule as to the burden of
proof in criminal cases and shifts the
onus on to the accused" (ibid). Such a
presumption is a presumption of law,
as distinguished from a presumption of
fact which describes provisions by
which the court 'may presume" a
certain state of affairs. Presumptions
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are rules of evidence and do not conflict
with the presumption of innocence,
because by the latter all that is meant
is that the prosecution is obliged to
prove the case against the accused
beyond reasonable doubt. The
obligation on the prosecution may be
discharged with the help of
presumptions of law or fact unless the
accused adduces evidence showing the
reasonable possibility of the
nonexistence of the presumed fact."
24. Similar view has been taken by the Hon'ble
Supreme Court in K.N.Beena vs. Munyappan and Ors.,
AIR 2001 SC 289.
25. Further, Hon'ble Supreme Court in Kalamani
Tex and Anr. V/s Balasubramanian, 2021 SCC Online
SC 75, held that:
"14. Adverting to the case in hand, we
find on a plain reading of its judgment
that the 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."
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26. From the ratio in the judgments, it is clear that
for the offence under Section 138 of the Act, the
presumptions under Section 118 (a) and Section 139 of
N.I.Act have to be compulsory raised as soon as execution
of cheque by the accused is admitted or proved by the
complainant and thereafter, burden shifts on the accused
to prove otherwise. A presumption is not in itself evidence
but only makes a prima facie case for a party for whose
benefit it exists. Presumptions, both under Sections 118
and 139 of N.I.Act are rebuttable in nature.
27. It is pertinent to refer to the judgment of the
Hon'ble Apex Court in M/s Kumar Exports Vs. Sharma
Carpets, (2009) 2 SCC 513, wherein it was held:-
"20. The accused in a trial under
Section 138 of the Act has two options.
He can either show that consideration
and debt did not exist or that under
the particular circumstances of the
case the non existence of
consideration and debt is so probable
that a prudent man ought to suppose
that no consideration and debt
existed. To rebut the statutory
presumptions an accused is not
expected to prove his defence beyond
reasonable doubt as is expected of the
complainant in a criminal trial. The
accused may adduce direct evidence
to prove that the note in question was
not supported by consideration and
that there was no debt or liability to be
discharged by him. However, the
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Court need not insist in every case
that the accused should disprove the
nonexistence of consideration and
debt by leading direct evidence
because the existence of negative
evidence is neither possible nor
contemplated. At the same time, it is
clear that bare denial of the passing of
the consideration and existence of
debt, apparently would not serve the
purpose of the accused. Something
which is probable has to be brought on
record for getting the burden of proof
shifted to the complainant. To disprove
the presumptions, the accused should
bring on record such facts and
circumstances, upon consideration of
which, the Court may either believe
that the consideration and debt did
not exist or their nonexistence was so
probable that a prudent man would
under the circumstances of the case,
act upon the plea that they did not
exist. Apart from adducing direct
evidence to prove that the note in
question was not supported by
consideration or that he had not
incurred any debt or liability, the
accused may also rely upon
circumstantial evidence and if the
circumstances so relied upon are
compelling, the burden may likewise
shift again on the complainant. The
accused may also rely upon
presumptions of fact, for instance,
those mentioned in Section 114 of the
Evidence Act to rebut the
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presumptions arising under Sections
118 and 139 of the Act."
28. Further, the above said principles have also been
recently crystallized by Hon'ble Supreme Court in the case
of Basalingappa vs Mudibasappa, (2019) 5 SCC 418,
where it s held that:-
"25. We having noticed the ratio laid
down by this Court in above cases on
Sections 118(a) and 139, we now
summarise the principles enumerated
by this Court in following manner:
(i) Once the execution of cheque is
admitted Section 139 of the Act
mandates a presumption that the
cheque was for the discharge of any
debt or other liability.
(ii) The presumption under Section 139
is a rebuttable presumption and the
onus is on the accused to raise the
probable defence. The standard of
proof for rebutting the presumption is
that of preponderance of probablities.
(iii) To rebut the presumption, it is open
for the accused to rely on evidence led
by him or accused can also rely on the
materials submitted by the
complainant in order to raise a
probable defence. Inference of
preponderance of probabilities can be
drawn not only from the materials
brought on record by the parties but
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also by reference to the circumstances
upon which they rely.
(iv) That it is not necessary for the
accused to come in the witness box in
support of his defence, Section 139
imposed an evidentiary burden and not
a persuasive burden.
(v) It is not necessary for the accused to
come in the witness box to support his
defence."
29. Reliance is also placed on the judgment of
Hon'ble Supreme Court in the case of Rajesh Jain V/s
Ajay Singh; (2023) 10 SCC 148, where it is 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 straightaway
proceed to convict him, subject to
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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."
56. 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 accused has chosen to
rebut the presumption): Has the accused
led any defense 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
nonexistence of debt/liability by a
preponderance of probabilities by referring
to the 'particular circumstances of the
case'?
30. Coming to the case on hand, where the
accused has failed to substantiate his contention that he
has borrowed ₹3,00,000/- only from the complainant and
the same has been returned. Absolutely, no evidence led
by the accused to show that he has returned ₹3,00,000/-.
Though, he has asserted that he has repaid ₹3,00,000/-
to the complainant in December, 2023, in the presence of
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one Manjunath, he has not chosen to examine the said
Manjuanth. Evidence of said witness would have been
material to prove the defence of the accused regarding
alleged repayment of ₹3,00,000/- to the complainant. On
the face of the cheque it is appearing that it was drawn for
₹6,00,000/-. When a person signs and delivers to
another, either wholly blank or having written thereon, a
negotiable instrument, he thereby gives prima facie
authority to the holder thereof to make or complete, as the
case may be. When the accused has admitted issuance of
cheque rather blank cheque, it is deemed that he has
authorized the holder (the complainant) to fill the amount
in the cheque.
31. Admittedly, the cheque was presented for
encashment within its validity period and it was
dishonored on 09.06.2023. Thereafter, on 27.06.2023 the
complainant issued a demand notice to the accused
calling upon him to pay the cheque amount. Admittedly,
the notice was served on the accused and that he has not
complied with the demand made in the notice. Therefore,
all ingredients of the offence under Section 138 of NI Act
have been proved. The accused has failed to make out a
probable defence so as to dislodge the presumptions
under Section 118(a) and 138 of NI Act by substantiating
his defence that he has borrowed only ₹3,00,000/- from
the complainant and that the subject cheque and another
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cheque with original sale deed handed over to the
complainant towards security for the said hand loan.
Therefore, this court holds that the complainant has
proved that the accused has committed the offence
punishable under Section 138 of N.I.Act. Accordingly, I
answer Point No.1 in the Affirmative.
32. Point No.2:-Punishment prescribed for the
offence under Section 138 of Negotiable Instruments Act
is imprisonment for a period which may extend to two
years or with fine which may extend to twice the amount
of the cheque or with both. Considering the facts and
circumstances of this case, year of the transaction and the
rate of interest stipulated under Section 80 of NI Act, this
court is of the considered view that it is just and desirable
to impose fine of ₹7,50,000/- and out of the said amount,
it is just and proper to award a sum of ₹7,45,000/- as
compensation to the complainant as provided U/s 357(1)
(b) of Cr.P.C and the remaining sum of ₹5,000/- shall go
to the State. In view of the discussions made while
answering Point No.1, I proceed to pass the following :
ORDER
Acting under Section 255(2) of Cr.P.C.,
accused is convicted for the offence
punishable under Section 138 of Negotiable
Instruments Act.
He is sentenced to pay a fine of
₹7,50,000/-. In default to pay fine, he shall
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undergo simple imprisonment for a period of
three months.
Out of the realized fine amount, a sum of
₹7,45,000/- is ordered to be paid to the
complainant as compensation and the
remaining sum of ₹5,000/- shall be remitted
to State.
Bail bonds executed by accused shall
stand cancelled.
Accused is entitled for a copy of this
judgment free of cost which shall be supplied
to him forthwith.
(Dictated to the Stenographer, transcript computerized by her, revised
corrected and then pronounced by me in the open Court on this the
22nd day of January 2025)
( SANTHOSH S.KUNDER )
XIV Addl. C.J.M., Bengaluru.
ANNEXURES
List of witnesses examined for the Complain
ant:
PW.1 Lokesh.G
List of documents marked for the Complainant:
Ex.P.1 Cheque
Ex.P.2 Bank endorsement
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Ex.P.3 Copy of legal notice
Ex.P.4 & 5 Postal receipts-2
Ex.P.6 Postal acknowledgment card
Ex.P.7 Postal cover
Ex.P.8 Copy of letter dated 15.09.2023
address to Post Master, CMM Court
Complex, Bengaluru
Ex.P.9 Postal track consignment report
Ex.P.10 Bank statement of the complainant
List of witness examined for the defence:
DW.1 Nagaraju B.M
List of documents marked for the defence:
Ex.D.1 Legal notice dated 21.06.2024 sent
by the accused to the complainantEx.D.2 Postal receipt
Ex.D.3 Returned postal cover
XIV Addl.C.J.M., Bengaluru.
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