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. 35 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
District Judge, Rajkot (hereinafter referred to as 'the learned
Appellate Court') in Criminal Appeal No. 12 of 2011 dated
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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. 3743 of 2005 dated 17.02.2011, whereby, the learned
Trial Court convicted and sentenced the accused to undergo
simple imprisonment for six months and ordered the accused to
pay Rs.3,50,000/- (Rupees Three Lacs Fifty Thousand Only) as
compensation 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:
2.1. The complainant and the accused were relatives and
the accused was the owner of Flat No.4 situated on the first floor
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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. 0268558 for Rs.3,50,000 dated 24.09.2004 from the
account with Rajkot Nagarik Sahkari Bank Limited, Dr.Yagnik
Road Branch, Rajkot was deposited by the complainant in his
account, but the cheque returned unpaid. On contacting the
accused, the complainant was asked to deposit the cheque once
again and when the cheque was deposited, it returned unpaid
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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. 3743 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 filed the
examination-in-chief at Exh.10 and examined one witness
Pitambar C. Chandnani at Exh.28 and produced 15 documentary
evidences in support of his case.
2.3. After the closing pursis was filed by the learned
advocate for the complainant, the further statement of the
accused under Section 313 of the Code was recorded wherein
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the accused denied the entire evidence on record. The accused
refused to step into the witness box or examine the witnesses
but produced six documentary evidence in his defence.
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 to simple imprisonment for
six months and to pay Rs.3,50,000/- (Rupees Three Lacs Fifty
Thousand Only) as compensation to the complainant within a
period of one month, and in default, simple imprisonment for 45
days.
2.5. Being aggrieved and dissatisfied with the judgment
and order passed by the learned Trial Court, the accused
preferred Criminal Appeal No.12 of 2011 before the Sessions
Court, Rajkot, whereby, the appeal preferred by the accused
came to be allowed and the learned 5th Additional District
Judge, Rajkot quashed and set aside the judgment and order
dated 17.02.2011 passed in Criminal Case No. 3743 of 2005 by
the learned 11th Additional Chief Judicial Magistrate, Rajkot and
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acquitted the respondent no.2 from the offence under Section
138 of the N.I.Act.
3. Being aggrieved and dissatisfied with the said
judgment and order of acquittal passed by the learned Sessions
Court in Criminal Appeal No.12 of 2011, the appellant - original
complainant 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 accused 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 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 as well as the deposition of the witness of the
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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 produced any documentary
evidence 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.
4. 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
order of conviction passed by the learned Trial Court and have
re-appreciated the entire evidence of the parties on record of
the case.
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5. 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 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
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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 passed by the learned Trial Court.
6. Learned APP Ms.C.M.Shah 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.
7. Learned Advocate Mr. Riddhesh Trivedi for the
respondent no.2 has submitted that the learned Sessions Court
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
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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 as the micr
cheques were submitted for clearing from 17.03.2004.
Moreover, there was no legally enforceable due amount
between the parties and in fact the respondent no.2 had filed
Regular Civil Suit No.443 of 2007 for declaration and permanent
injunction to restrain the Rajkot Nagarik Sahkari 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
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
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learned advocate has vehemently argued to reject the appeal of
the appellant.
8. 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
(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.
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Explanation.--For the purposes of this section, "debt or other
liability" means a legally enforceable debt or other liability.]
9. 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
his affidavit of examination in chief, he has mentioned the date
as 03.09.1999, but no such agreement to sell has been produced
on record. The complainant has also admitted that no cheque
for the amount of Rs.3,85,000/- has been issued by the accused
and no notice for the unpaid cheque of Rs.3,85,000/- has been
issued to the accused. He had paid an amount of Rs.70,000/- as
earnest money towards the purchase price of the flat and from
the year 1996 till the year 2005, he did not give any notice to the
accused for specific performance of the agreement to sell and
has not filed any case before any Civil Court in Rajkot for
specific performance of the contract. The accused had sent a
reply to the notice, which is produced at Exh.19 and he has not
produced any agreement to sell of the year 1996 on record. He
has not mentioned how, when and where the remaining amount
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of the purchase price was paid to the accused and has no
documentary evidence to show that any amount was paid in
cash to the accused. As per his say, the accused did not hand
over possession of the flat to him but had sold the flat to some
other the person and the complainant has admitted that he has
filed Regular Civil Suit No. 443 of 2007 before the Civil Court,
Rajkot against the Rajkot Nagarik Sahkari Bank Ltd. and the
accused for declaration and permanent injunction to restrain
them from dispossessing his possession in the flat. The plaint of
Regular Civil Suit No. 443 of 2007 is produced at Exh.22. The
complainant has stated that if the accused had handed over
possession of the flat at the time of execution of the agreement
to sell, there would be no dispute between them, but
immediately thereafter, has admitted that in the document
produced at Exh.22, which is the plaint of Regular Civil Suit No.
443 of 2007, he has stated that the accused had handed over the
possession of the flat to him and the possession of the flat is with
him for the past 10 to 11 years. The counter affidavit filed by the
complainant is produced on record at Exh.23. The complainant
has thereafter admitted that he had given the possession of the
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flat to one Janakbhai N. Gowani and the interlocutory injunction
application filed in the civil suit was rejected by the Civil Court,
Rajkot.
10. At this juncture, it would be fit to reproduce the
provisions of section 118 and section 139 of the Negotiable
Instruments Act which read as under.
"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 indorsement--that the indorsements
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
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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."
11. It is pertinent to note that section 138 of the N.I.Act
stipulates that to constitute an offence under the Act, the
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
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liability is a sine qua non for bringing an offence under section
138 of the N.I.Act.
12. 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
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/-. 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 Sahkari 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 defence that the cheques were issued as a
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security in the year 1995 and these old non-micr cheques have
been misused by the complainant and the same has been
proved in the evidence of the witness who has stated that the
non-micr cheques were used earlier and the accused has raised
a plausible defence that there was no legally enforceable debt
pending from the accused.
13. 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
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learned Sessions Court and the present appeal is devoid of
merits and resultantly, the same is dismissed.
14. The impugned judgment and the order dated
31.05.2011 in Criminal Appeal No.12 of 2011 passed by the
learned 5th Additional District Judge, Rajkot is hereby
confirmed.
15. 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.....
