Karnataka High Court
Smt. M. Vijayalakshmi vs Sri. M. Sanjay on 9 January, 2025
Author: Shivashankar Amarannavar
Bench: Shivashankar Amarannavar
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CRL.A No. 517 of 2016
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 9TH DAY OF JANUARY, 2025
BEFORE
THE HON'BLE MR JUSTICE SHIVASHANKAR AMARANNAVAR
CRIMINAL APPEAL No. 517 OF 2016
BETWEEN:
SMT. M. VIJAYALAKSHMI
WIFE OF B. MOHANKUMAR
AGED 37 YEARS
RESIDING AT No.7
S.K. MUNIYAPPA BUILDING
6TH CROSS, VINAYAKANAGAR
KAMAKSHIPALYA
BANGALORE - 560 079.
Digitally signed by ...APPELLANT
LAKSHMINARAYANA
MURTHY RAJASHRI
Location: HIGH (BY SRI JAGADISH BALIGA N, ADVOCATE)
COURT OF
KARNATAKA
AND:
SRI M. SANJAY
C/O SIDDALINGAPPA
AGED ABOUT 45 YEARS
GANGADHARESHWARA NILAYA
SIDDALINGAPPA BUILDING
BESIDE ASHQINI BENGAL STORE
PETROL BUNK ROAD,
3RD CROSS, VINAYAKANAGAR
KAMAKSHIPALYA
BANGALORE - 560 079.
...RESPONDENT
(BY SRI YASHODHAR HEGDE, ADVOCATE)
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CRL.A No. 517 of 2016
THIS CRL.A IS FILED UNDER SECTION 378(4) Cr.P.C
PRAYING TO SET ASIDE THE JUDGMENT AND ORDER DATED
05.01.2015 PASSED BY THE XXII A.C.M.M., BANGALORE IN
C.C.No.9623/2012 - ACQUITTING THE RESPONDENT/ACCUSED
FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF N.I.
ACT AND ETC.,
THIS APPEAL COMING ON FOR DICTATING JUDGMENT
THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE SHIVASHANKAR AMARANNAVAR
ORAL JUDGMENT
1. This appeal is filed by the appellant – complainant
praying to set-aside the judgment of acquittal dated
05.01.2015 passed in C.C.No.9623/2012 by the XXII
Additional Chief Metropolitan Magistrate, Bengaluru,
whereunder, the respondent – accused has been acquitted
of the offence punishable under Section 138 of the
Negotiable Instruments Act, 1881 (for short hereinafter
referred to as ‘N.I.Act’).
2. The brief facts of the complainant’s case is that;
The respondent – accused is known to her for the
past several years. The respondent – accused approached
the complainant during the first week of February, 2011
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and requested to lend a sum of Rs.1,25,000/- as hand
loan and agreed to return the same within the period of
three to four months and he has sought the said hand loan
to meet the domestic and legal necessities. The
complainant paid Rs.1,00,000/- by way of cash on
05.02.2011 to the respondent – accused. During the last
week of April, 2011, the complainant approached the
respondent – accused for repayment of the said hand loan
amount. The respondent – accused had issued a cheque
bearing No.579938 dated 18.05.2011 drawn on Vijaya
Bank, Vijaynagar Branch, Bengaluru towards the
repayment of the loan to the complainant. The
complainant presented the said cheque on 26.06.2011 for
encashment and the same has been returned with
endorsement “Opening Balance Insufficient”. Thereafter,
the complainant got issued the legal notice on 29.08.2011
and it has been served on the respondent – accused on
02.09.2011. The respondent – accused did not pay the
cheque amount, therefore, the complainant filed the
complaint against the respondent – accused for the
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offence under Section 138 of the N.I.Act. Cognizance was
taken and sworn statement was recorded and the case
came to registered against the respondent – accused for
the offence under Section 138 of the N.I.Act in
C.C.No.9623/2012. The respondent – accused appeared
and a plea came to be recorded. The complainant
examined herself as PW1 and got marked Exs.P1 to P10
and also examined one witness as PW2. The respondent –
accused got marked Ex.D1 in the cross examination of
PW1. The statement of the respondent – accused came to
be recorded under Section 313 of Cr.P.C. The respondent
– accused did not lead any defence evidence. The learned
Magistrate, after hearing the arguments on both sides has
formulated the points for consideration and thereafter,
passed the impugned judgment of acquittal. The said
judgment of acquittal has been challenged by the
complainant in the present appeal.
3. Heard learned counsel for the appellant and learned
counsel for the respondent – accused
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4. Learned counsel for the appellant – complainant
would contend that all the ingredients of the offence under
Section 138 of the N.I.Act have been fulfilled. The
respondent – accused inspite of receipt of notice has not
given any reply putting forth his defence. The evidence of
PW2 coupled with evidence of PW1 would establish that
the complainant had lent Rs.1,00,000/- to the respondent
– accused as hand loan. The cheque – Ex.P1 has been
issued for making payment of legally enforceable debt. As
the amount lent has been established and as the signature
on the cheque has been established by the respondent –
accused, a presumption has to be drawn under Section
139 of the N.I.Act. He contends that even though a
document which is confronted to PW1 is not admitted by
her, but it came to be marked as Ex.D1. The defence of
the respondent – accused that he had given the cheque –
Ex.P1 as a security to the chit transaction run by the
complainant has not been established. Merely producing a
note book containing the chit details which is at Ex.D1
does not establish the defence of the respondent –
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accused that cheque – Ex.P1 has been issued as a security
for the said chit transaction. The respondent – accused
has not given any explanation at the time of recording his
statement under Section 313 of Cr.P.C. The respondent –
accused at the time of recording his statement under
Section 313 of Cr.P.C has stated that he will lead evidence
but he has not led evidence. As Ex.D1 has not been
admitted by PW1, it cannot be relied on to establish the
defence of the respondent – accused. As the appellant –
complainant has established that she had lent
Rs.1,00,000/- to the respondent – accused as a hand loan
and the cheque – Ex.P1 has been issued for repayment of
the said hand loan amount and the cheque came to be
dishonoured for “Opening Balance insufficient” itself would
establish the offence under Section 138 of the N.I.Act. He
further submits that payment of Rs.1,00,000/- by cash
given by the complainant to the respondent – accused
which has been stated by PWs.1 and 2 has not been
denied in their cross examination. On these grounds, he
prayed for allowing the appeal and convicting the
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respondent – accused for the offence under Section 138 of
N.I.Act.
5. Learned counsel for the respondent – accused would
contend that the objection was not raised at the time of
marking Ex.D1. On reading the first sentence in the cross
examination itself would indicate that PW1 has admitted
that she is running the chit transaction. The complainant
has not produced the documents regarding she pledging
her ornaments and availing loan of Rs.60,000/- even
though she has admitted that she is in possession of the
said documents. The financial capacity of the complainant
has been disputed by the respondent – accused. The
payment of Rs.1,00,000/- by the complainant to the
respondent – accused has not been established. The
complainant was running the saree business and she is
earning only Rs.9,000/- per month and therefore, she has
no capacity to lend Rs.1,00,000/-. PW2 is an interested
witness and therefore, his evidence cannot be relied on.
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(i) Learned counsel for the respondent – accused
placed reliance on the decision of the Hon’ble Apex Court
in the case of Dattatraya Vs. Sharanappa reported in
(2024) 8 SCC 573. He contends that the judgment of
acquittal cannot be interfered unless it is shown that there
is no appreciation of evidence and it is passed based on
the irrelevant and inadmissible evidence. He also placed
reliance on the decision of the Hon’ble Apex Court in the
case of R.V.E.Venkatachala Gounder Vs. Arulmigu
Viswesaraswami & V.P.Temple and Another reported
in (2003)8 SCC 752, on the point that as the objection to
the marking of Ex.D1 has not been raised at the trial, now
the said objection cannot be raised at the later stage or
even in appeal or revision. He also placed reliance on the
decision of the Hon’ble Apex Court in the case of
Basalingappa Vs. Mudibasappa reported in
(2019) 5 SCC 418, on the point that the standard of
proof for rebutting the presumption is preponderance of
probabilities and presumption can be rebutted either by
leading evidence of the respondent – accused or by the
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cross examination of the complainant witnesses. He
submits that there are no grounds for interfering with the
well reasoned judgment of acquittal passed by the Trial
Court. With this, he prayed to dismiss the appeal.
6. Having heard the learned counsels, the Court has
perused the impugned judgment and the Trial Court
records.
7. Considering the grounds raised and urged, the
following point arises for consideration;
“whether the Trial Court has erred in acquitting
the respondent – accused of the offence
punishable under Section 138 of the N.I.Act”
8. My answer to the above point is in the affirmative,
for the following reasons;
It is the case of the complainant – appellant that the
respondent – accused requested for hand loan and she
had paid Rs.1,00,000/- by way of cash as hand loan to the
respondent – accused on 05.02.2011. In order to
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establish the said aspect, the complainant has been
examined as PW1 and one witness has been examined on
her behalf as PW2. PW1, in her chief examination has
stated regarding the request of the respondent – accused
for hand loan and she paying the respondent – accused
cash of Rs.1,00,000/- as hand loan on 05.02.2011. Even
though PW1 has been cross examined at length, there is
no denial of the aspect of PW1 lending Rs.1,00,000/- by
way of cash to the respondent – accused on 05.02.2011.
PW2 is an independent witness who has stated in his chief
examination that when he visited the shop of the
complainant on 05.02.2011 for purchase of saree for his
wife, he witnessed the complainant giving cash of
Rs.1,00,000/- to the respondent – accused and he came
to know that the respondent – accused had borrowed the
said amount as hand loan from the complainant for his
domestic and legal necessities. PW2 has also been cross
examined by the respondent – accused, but there is no
denial of the said aspect of the complainant giving cash of
Rs.1,00,000/- in his presence to the respondent –
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accused. The said evidence of PWs.1 and 2 itself
establishes the complainant lending Rs.1,00,000/- by way
of cash to the respondent – accused. The learned
Magistrate has ignored the above said aspects and not
considered the evidence of PW2. PW2 cannot be said to
be an interested witness only because he was acquainted
with the complainant. PW2 in his cross examination has
stated that he also knew the respondent – accused since
three to four years.
9. It is the defence of the respondent – accused that
Ex.P1 – cheque has been given to the complainant as a
security for chit transaction run by her. In order to
establish his defence, he placed reliance only on the cross
examination of PW1 and Ex.D1 – note book. PW1, in her
cross examination had denied that Ex.P1 – cheque has
been given by the respondent – accused as a security to
the chit transaction run by her. Ex.D1 – note book has
been confronted to PW1 in her cross examination stating
that she is running the chit transaction and there are
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entries of 24 chit transactions in the note book for the
period from 10.04.2009 to 10.07.2010 and in that aspect
PW1 has stated that she is not aware of the same. The
said note book confronted to PW1 has been marked as
Ex.D1. When PW1 has not admitted Ex.D1 and its
contents, it is for the respondent – accused to establish
the same. In Ex.D1, there is no mention of giving any
cheque as security for the chit transaction. There is also
no mention of the aspect of the complainant running the
said chit transaction. The possession of the said Ex.D1 –
note book itself would indicate that the respondent –
accused might be running the said chit transaction. As per
the entries in Ex.D1, there are 24 members in the said chit
transaction. The respondent – accused has not chosen to
examine any of the said members of the chit transaction
to establish that the cheque has to be issued as a security
for the chit transaction and the complainant was running
the said chit transaction. The respondent – accused at the
time of recording his statement under Section 313 of
Cr.P.C has stated that he will lead evidence, but, he has
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not led any evidence on his behalf. On perusal of the
cross examination of PW1 and Ex.D1, will not probabalize
the defence of the respondent – accused that Ex.P1 –
cheque has been issued as a security to the complainant
to the chit transaction run by her.
10. Learned counsel for the respondent – accused has
argued that the complainant has not produced the
documents regarding she pledging her ornaments and
availing the loan from the Society. In the sense, he
disputes the financial capacity of the complainant to lend
money. In the case of Tedhi Singh Vs. Narayan Dass
Mahant reported in (2022) 6 SCC 735, the Hon’ble Apex
Court has held as under;
“8. It is true that this is a case under Section 138 of
the Negotiable Instruments Act. Section 139 of the
N.I. Act provides that Court shall presume 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. This
presumption, however, is expressly made subject to
the position being proved to the contrary. In other
words, it is open to the accused to establish that
there is no consideration received. It is in the context
of this provision that the theory of ‘probable defence’
has grown. In an earlier judgment, in fact, which has
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this Court notes that Section 139 of the N.I. Act is an
example of reverse onus. It is also true that this
Court has found that the accused is not expected to
discharge an unduly high standard of proof. It is
accordingly that the principle has developed that all
which the accused needs to establish is a probable
defence. As to whether a probable defence has been
established is a matter to be decided on the facts of
each case on the conspectus of evidence and
circumstances that exist.”
11. Section 139 of the N.I.Act provides that the Court
shall presume that the holder of the cheque received the
cheque of the nature referred to in Section 138 of the
N.I.Act, for the discharge, in whole or in part, of any debt
or other liability. This presumption, however, is expressly
made subject to the position being proved to the contrary.
In other words, it is open to the respondent – accused to
establish that there is no consideration received. Whether
a probable defence has been established is a matter to be
decided on the facts of each case on the conspectus of
evidence and the circumstances that exists.
12. The evidence of PWs.1 and 2 will prove the fact of
lending cash of Rs.1,00,000/- by the complainant to the
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respondent – accused as hand loan. Merely because the
chit transaction has been run by a person, it cannot be
presumed that the cheque has been issued as a security
for the said chit transaction. The cross examination of
PW1 and the contents of Ex.D1 does not establish that a
blank cheque has been issued as a security for the chit
transaction. The respondent – accused has failed to
establish his probable defence that the cheque has been
issued as a security for the chit transaction. Without
considering all these aspects, the learned Magistrate has
erred in passing the impugned judgment of acquittal.
Considering the documents produced, all the ingredients of
the offence under Section 138 of the N.I Act are
established. Considering the said aspects, the complainant
has proved that the respondent – accused has committed
the offence under Section 138 of the N.I.Act. In view of
the above, the impugned judgment of acquittal requires to
be set-aside and the respondent – accused requires to be
convicted for the offence under Section 138 of the N.I.Act.
In the result, the following;
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ORDER
The appeal is allowed. The impugned judgment of
acquittal dated 05.01.2015 passed in C.C.No.9623/2012
by the XXII Additional Chief Metropolitan Magistrate,
Benglauru is set-aside. The respondent – accused is
convicted for the offence under Section 138 of the N.I.Act
and he is sentenced to pay fine of Rs.1,40,000/- and in
default, to undergo simple imprisonment for a period of
six months. Out of the fine amount, a sum of
Rs.1,30,000/- is ordered to be paid as compensation to
the appellant – complainant. The respondent – accused
shall deposit the said fine amount within a period of three
months from today.
Sd/-
(SHIVASHANKAR AMARANNAVAR)
JUDGE
GH
List No.: 1 Sl No.: 8