Gujarat High Court
Nitin Vrujlal Kakkad vs State Of Gujarat on 4 November, 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
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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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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
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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
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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
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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
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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
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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
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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
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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
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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
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(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.
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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
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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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"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
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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
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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
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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.
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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.....
