Gujarat High Court
Nitin Vrujlal Kakkad vs State Of Gujarat on 4 November, 2025
NEUTRAL CITATION
R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL APPEAL NO. 9 of 2012
FOR APPROVAL AND SIGNATURE:
HONOURABLE MS. JUSTICE S.V. PINTO Sd/-
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Approved for Reporting Yes No
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NITIN VRUJLAL KAKKAD
Versus
STATE OF GUJARAT & ANR.
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Appearance:
MANAN K PANERI(7959) for the Appellant(s) No. 1
MR DEVANSH N KAKKAD(12134) for the Appellant(s) No. 1
MR RIDDHESH TRIVEDI(6581) for the Opponent(s)/Respondent(s) No. 2
MS C.M.SHAH, APP for the Opponent(s)/Respondent(s) No. 1
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CORAM:HONOURABLE MS. JUSTICE S.V. PINTO
Date : 04/11/2025
ORAL JUDGMENT
1. This appeal has been filed by the appellant - original complainant under Section 378(1)(3) of the Code of Criminal Procedure, 1973 (hereinafter referred to as 'the Code') against the judgment and the order passed by the learned 5 th Additional Page 1 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined District Judge, Rajkot (hereinafter referred to as 'the learned Appellate Court') in Criminal Appeal No. 13 of 2011 dated 31.05.2011, whereby, the learned Appellate Court has quashed and set aside the judgment and order of conviction passed by the learned 11th Additional Chief Judicial Magistrate, Rajkot, (hereinafter referred to as 'the learned Trial Court) in Criminal Case No. 3744 of 2005 dated 17.02.2011, whereby, the learned Trial Court convicted and sentenced the respondent no.2 to undergo simple imprisonment for six months and to pay an amount of Rs.35,000/- (Rupees Thirty Five Thousand Only) as compensation to the appellant within a period of one month and in default, simple imprisonment for 45 days for the offence punishable under Section 138 of the Negotiable Instruments Act (hereinafter referred to as 'the N.I.Act'). 1.1. The parties are hereinafter referred to as 'the complainant and the accused' as they stood in the original case, for the sake of convenience, clarity and brevity.
2. The relevant facts leading to filing of the present appeal are as under:
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NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined 2.1. The complainant and the accused were relatives and the accused was the owner of Flat No.4 situated on the first floor of "Gaurav Apartment' on Kalavad Road, Rajkot having a built up area of 450 square feet. The complainant wanted to purchase the flat and a registered agreement to sell was executed between the parties and the complainant had paid an amount of Rs.70,000/- as earnest money to the accused by two cheques.
The remaining amount was also paid in cash, but the accused did not hand over possession of the flat to the complainant and did not get the registered sale deed executed in favour of the complainant. The accused sold the flat to some other person and had also taken a loan on the flat and as the registered sale deed could not be executed, a compromise was arrived at between the parties and the market value of the flat was fixed at Rs.3,85,000/-. Towards the compromise amount, two cheques were given by the accused to the complainant, out of which, cheque no. 0184582 for Rs.35,000/- dated 08.02.2005 from his account with Rajkot Nagarik Sarkari Bank Limited, Dr. Yagnik Road Branch, Rajkot was deposited by the complainant in his account, but the cheque returned unpaid. On contacting the Page 3 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined accused, the complainant was asked to deposit the cheque once again and when the cheque was deposited once again, it returned unpaid with the endorsement "Funds Insufficient". The demand statutory notice was given which was duly served to the accused and the accused gave an evasive reply, but did not repay the amount within the stipulated period, and hence, the complainant filed a complaint under Section 138 of the N.I.Act before the Court of the Chief Judicial Magistrate Rajkot on 11.04.2005, which came to be registered as Criminal Case No. 3744 of 2005.
2.2. The learned Trial Court took cognizance of the offence and the accused was duly served with the summons and appeared before the learned Trial Court. The plea of the accused was recorded at Exh.9, wherein, the accused denied all the contents of the complaint and the entire evidence of the complainant was taken on record. The complainant was examined at Exh.10 and he produced 10 documentary evidences in support of the case.
2.3. After the closing pursis was filed by the learned Page 4 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined advocate for the complainant, the further statement of the accused under Section 313 of the Code was recorded wherein the accused denied the evidence on record. The accused refused to step into the witness box or lead evidence but examined one witness and produced six documentary evidence in support of his case.
2.4. After hearing the arguments of the learned advocates for both the parties, the learned Trial Court, by the impugned judgment and order dated 17.02.2011, was pleased to convict and sentence the accused simple imprisonment for six months and pay Rs.35,000/- (Rupees Thirty Five Thousand Only) as compensation to the complainant within a period of one month and in default, simple imprisonment for 45 days for the offence punishable under Section 138 of the N.I.Act.
3. Being aggrieved and dissatisfied with the judgment and order of conviction passed by the learned Trial Court, the accused preferred Criminal Appeal No.13 of 2011 before the Sessions Court, Rajkot, whereby, the appeal preferred by the accused came to be allowed and the learned 5th Additional Page 5 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined District Judge, Rajkot was pleased to quash and set aside the judgment and order of conviction dated 17.02.2011 passed in Criminal Case No. 3744 of 2005 by the learned 11 th Additional Chief Judicial Magistrate, Rajkot and acquit the accused from the offence.
4. Being aggrieved and dissatisfied with the said judgment and order of acquittal passed by the learned Sessions Court in Criminal Appeal No.13 of 2011, the appellant has filed the present appeal mainly stating that the impugned judgment and order passed by the learned Sessions Court, Rajkot is erroneous, unjust and contrary to the evidence on record and also on the factual aspect of the case and the appellant had, in fact, proved by relevant documents as well as oral evidence that the respondent no.2 had committed the offence under Section 138 of the N.I.Act. The learned Trial Court had rightly convicted the respondent no. 2 and the learned Sessions Court has not considered that the intention of the respondent no.2 was very clear from the beginning not to pay the amount of the cheque to the appellant even though the cheque was issued against the Page 6 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined legal dues as per the compromise arrived at between the parties. The learned Sessions Court has ignored these facts and has not considered the deposition of the appellant where it is proved that the cheque was issued even though there were no funds in the account of the respondent no.2. The respondent no.2 has not stepped into the witness box and even if the opinion of the handwriting expert is considered, it is proved that the cheque was issued by the respondent no.2. The judgment and order passed by the learned Sessions Court is erroneous, unjust and contrary to the evidence on record and is required to be quashed and set aside and the judgment and order of conviction passed by the learned Trial Court be restored and made absolute.
5. Heard learned advocate Mr. Devansh Kakkad for learned advocate Manan Paneri for the appellant - original complainant, learned APP Ms.C.M.Shah for the respondent No.1- State and learned advocate Mr. Riddhesh Trivedi for the respondent no.2. Perused the impugned judgment and order of acquittal passed by the Appellate Court as well as judgment and Page 7 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined order of conviction passed by the learned Trial Court and have re-appreciated the entire evidence of the prosecution on record of the case.
6. Learned Advocate Mr.Devansh Kakkad for the appellant has submitted that the learned Trial Court had properly appreciated the entire evidence, whereas, the Sessions Court has not appreciated the evidence properly. The appellant had, in fact, produced cogent evidence to prove that the cheque was issued for the legally enforceable debt and the document produced at Exh.13 is the registered agreement to sell which proves that the appellant had entered into an agreement to purchase the property of the respondent no.2 and had given an amount of Rs.70,000/- as earnest money but the possession of the property was not handed over, and thereafter, a compromise was arrived at between the parties, towards which, the amount of Rs.3,85,000/- which was the market price of the flat was decided and towards payment of the same, the cheque of Rs.3,50,000/- was given. The appellant has proved that the cheque had returned unpaid with the endorsement Page 8 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined funds insufficient, and thereafter, the demand statutory notice was given towards which an evasive reply was given but the amount was not paid within the stipulated period and the learned Trial Court had appreciated the entire evidence and had convicted the respondent no.2, but the learned Sessions Court, without considering the evidence on record, has passed the impugned judgment and order of acquittal. Learned advocate has urged this court to allow the appeal and quash and set aside the judgment and order of acquittal and restore the judgment and order of conviction of the learned Trial Court.
7. Learned APP Ms.C.M.Shah for the respondent - State has submitted that the learned Sessions Court has appreciated all the evidence in true perspective and has not committed any error in acquitting the accused. Therefore, no interference of this Court is required in the impugned judgment and the order of acquittal passed by the learned Sessions Court and has urged this Court to reject the appeal.
8. Learned Advocate Mr. Riddhesh Trivedi for the respondent no.2 has submitted that the learned Sessions Court Page 9 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined has considered that the appellant did not prove that there was any legally enforceable debt and at the inception itself, it was the defense of the respondent no.2 that the cheque in question was given as a security and if the document produced at Exh.13 is perused the agreement to sell was executed between the parties on 03.09.1995. The cheques were given as a security in the year 1995 and thereafter the possession of the flat was also handed over to the appellant and no compromise as stated by the appellant has been arrived at between the parties. The respondent no.2 has also proved that the cheques were old cheques and in the cross-examination of the witness of the appellant it has come on record that the cheque was a non-micr cheque and it has been misused by the appellant. Moreover, there was no legally enforceable due amount between the parties and in fact the appellant had filed Regular Civil Suit No.443 of 2007 for declaration and permanent injunction to restrain the Rajkot Nagarik Sarkari Bank Limited and the respondent no.2 from dispossessing the appellant from the property. Hence, the learned Sessions Court has properly appreciated the evidence and has concluded that there was no Page 10 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined legally enforceable due amount outstanding from the respondent no.2 to be paid to the appellant and has rightly passed the impugned judgment and order of acquittal and learned advocate has vehemently argued to reject the appeal of the appellant.
9. As the case is filed under Section 138 of the N.I.Act, the provision of Section 138 of the N.I.Act is reproduced as under:
"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, be 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) he 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;
(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 Page 11 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined
(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 this section, "debt or other liability" means a legally enforceable debt or other liability.]
10. On perusal of the evidence on record of the learned Trial Court, the complainant has filed his affidavit of examination-in-chief at Exh.10 and in the cross-examination by the learned advocate for the accused, the complainant has admitted that in the notice at Exh.26, no demand for Rs.35,000 has been made and from the time that the agreement to sell was executed till 2005 i.e. for a period of 11 years, no steps for the flat have been taken and no notice was given to the accused. The complainant has also admitted that he had no relations with the accused since the year 2000 and after the year 2000, there were no dealings with the accused. Besides the dealing of the flat, no other dealings had taken place and the complainant has stated that there was a rent deed executed between them, but it was not produced on record. Thereafter, the complainant has produced the rent deed at Exh.28, but the deed does not mention that any amount in cash was paid to the accused. Page 12 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025
NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined Besides the agreement to sell wherein it is mentioned that an amount of Rs.70,000/- was paid as earnest money, there was no evidence with the complainant to show that any other amount has been paid and the dealing regarding the flat had taken place in the year 1995. No amount was given as advance to the accused and he did not have any documentary evidence to prove that the accused had sold the flat to some other person. The complainant has admitted that he had filed Regular Civil Suit No.443 of 2007 for declaration and permanent injunction against Rajkot Nagarik Sahkari Bank Limited and the accused and had also sought for an interlocutory injunction to restrain them from dispossessing his possession in the flat, but the interlocutory injunction application was rejected by the Civil Court. The complainant has admitted that the cheque was not given towards any compromise about the flat and he did not have any documentary evidence to show that he had paid any amount of rent to the accused as per the rent agreement produced at Exh.28. The complainant has stated that the cheque produced at Exh.21 is dated 08.02.2005, but it was presented in the bank on 07.02.2005 and he has not mentioned that the Page 13 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined amount is outstanding from the accused in his Income Tax Returns.
11. On perusal of the document produced at Exh.30, which is the copy of the plaint of Regular Civil Suit No.443 of 2007 filed by the complainant against Rajkot Nagarik Sahkari Bank Limited and the accused for declaration and permanent injunction, the accused has stated that the possession of the flat is with Janakbhai Nandlalbhai Gowani from the year 1996 and the flat was given on rent to him by the complainant for a monthly rent of Rs.250/-. The suit has been filed with a prayer that the Rajkot Nagarik Sahkari Bank Limited and the accused do not dispossess the tenant from his possession in the flat and for declaration that the Rajkot Nagarik Sahkari Bank Limited and the accused do not have any right, title or interest in the flat as the agreement to sell dated 30.09.1995 is in existence.
12. At this juncture, it would be fit to reproduce the provisions of section 118 and section 139 of the N.I.Act which read as under.
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NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined "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 or transferred for consideration;
(b) as to date--that every negotiable instrument bearing a date was made or drawn on such date;
(c) as to time of acceptance--that every bill of exchange was accepted within a reasonable time after its date and before its maturity;
(d) as to time of transfer--that every transfer of a negotiable instrument was made before its maturity;
(e) as to order of endorsement--that the endorsements appearing upon a negotiable instrument were made in the order in which they appear thereon;
(f) as to stamp--that a lost promissory note, bill of exchange or cheque was duly stamped;
(g) that the holder of a negotiable instrument is a holder in due course:
Provided that, where the instrument has been obtained from its lawful owner, or from any person in lawful custody thereof, by means of an offence or fraud, or has been obtained from the maker or acceptor thereof by means of an offence or fraud, or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him."
"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."
13. It is pertinent to note that Section 138 of the N.I.Act stipulates that to constitute an offence under the Act, the Page 15 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined complainant must prove that the cheque was issued by the accused in discharge of a legally enforceable debt or any other liability and the cheque was presented into the bank and it was returned unpaid on account of insufficiency of funds or because it exceeded the amount arranged to be paid by the drawer of the cheque by an agreement with the bank. The accused thereafter must have failed to pay the amount of cheque within 15 days of receipt of the statutory notice and the presumption as enumerated in section 139 of the N.I.Act is rebuttable in nature. The complainant is to prove that the cheque was issued for a legally enforceable debt and the legally enforceable debt must be in existence on the date when the cheque was issued and the drawing of the cheque in discharge of the existing or past liability is a sine qua non for bringing an offence under section 138 of the N.I.Act.
13.1. In the instant case, the complainant has stated that there was a compromise arrived at between the parties towards which an amount of Rs.3,85,000/- was fixed as the market price of the flat and the cheque in question was given by the accused Page 16 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined towards payment of the same, but there is no evidence on record to show that any compromise was arrived at between the parties and the market price of the flat was fixed at Rs.3,85,000/-. The complainant has not mentioned the date, month or year when the compromise was arrived at between the parties and has not produced any documentary evidence about the compromise. Moreover, the accused has rebutted the presumption and has brought on record the plaint of Regular Civil Suit No. 443 of 2007, which has been filed by the complainant for declaration and permanent injunction to restrain the Rajkot Nagarik Sarkari Bank Limited and the respondent no.2 from dispossessing the appellant from the property. Hence, it is on record that the property was in the possession of the complainant as admitted by him during the cross-examination and it cannot be said that there was any legally enforceable debt outstanding from the accused. The accused has raised a probable defence to the extent of preponderance of probability that there was no legally enforceable debt pending from the accused and in the evidence of the complainant, there is no iota of evidence that there was Page 17 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025 NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined any legally enforceable amount due as the possession of the flat was with the complainant from the time of execution of the agreement to sell as admitted by the complainant.
14. In view of the above, the learned Sessions Court has appreciated the entire evidence in proper perspective and there does not appear to be any infirmity and illegality in the impugned judgment and order of acquittal. The learned Sessions Court has appreciated all the evidence and this Court is of the considered opinion that the learned Sessions Court was completely justified in acquitting the accused of the charges leveled against him. The findings recorded by the learned Sessions Court are absolutely just and proper and no illegality or infirmity has been committed by the learned Sessions Court and this Court is in complete agreement with the findings, ultimate conclusion and the resultant order of acquittal recorded by the learned Sessions Court. This Court finds no reason to interfere with the impugned judgment and order passed by the learned Sessions Court and the present appeal is devoid of merits and resultantly, the same is dismissed. Page 18 of 19 Uploaded by F.S. KAZI(HC01075) on Thu Nov 06 2025 Downloaded on : Thu Nov 06 23:55:32 IST 2025
NEUTRAL CITATION R/CR.A/9/2012 JUDGMENT DATED: 04/11/2025 undefined
15. The impugned judgment and the order dated 31.05.2011 in Criminal Appeal No.13 of 2011 passed by the learned 5th Additional District Judge, Rajkot is hereby confirmed.
16. Bail bond stands cancelled. Record and proceedings be sent back to the learned First Appellate Court forthwith.
Sd/-
(S. V. PINTO,J) F.S.KAZI.....
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