Sri Ashok B Dani vs Sri P R Bhot
2022 Latest Caselaw 3310 Kant

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   IN THE HIGH COURT OF KARNATAKA AT BENGALURU

       DATED THIS THE 25TH DAY OF FEBRUARY, 2022

                        BEFORE

    THE HON'BLE MR. JUSTICE RAJENDRA BADAMIKAR

            CRIMINAL APPEAL No.236/2019 (A)

BETWEEN:

SRI. ASHOK B DANI
S/O LATE SRI. BHIKALAL DANI
AGED ABOUT 59 YEARS
RESIDING AT SARDAR PATEL HOSTEL
SARAKKI GARDEN, J.P. NAGAR
6TH CROSS, 110 FEET RING ROAD,
BENGALURU-560 078
                                           ....APPELLANT

(BY SRI. ANUP RAJ, ADVOCATE FOR
   SRI. VAMSHI KRISHNA .C, ADVOCATE)


AND:

SRI. P.R. BHOT
MAJOR IN AGE, ADVOCATE
#32, MAIN, WEST OF CHORD ROAD
BASAVESHWARANAGAR
BENGALURU-560 079
                                        .... RESPONDENT
(BY SRI. SHANKAR M. NAIK, ADVOCATE)

     THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378(4)
OF CR.P.C. PRAYING TO SET ASIDE THE JUDGMENT DATED
25.10.2018 PASSED BY THE XVI A.C.M.M., BANGALORE IN
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C.C.NO.1667/2017-ACQUITING THE RESPONDENT/ACCUSED
FOR THE OFFENCE P/U/S 138 OF N.I.ACT.

      THIS    CRIMINAL    APPEAL    HAVING   BEEN   HEARD   AND
RESERVED FOR JUDGMENT ON 18.02.2022, COMING ON FOR
'PRONOUNCEMENT          JUDGMENT'    THIS    DAY,   THE   COURT
DELIVERED THE FOLLOWING:


                           JUDGMENT

Though this appeal is listed for admission, with the

consent of the learned counsels appearing for the parties on

both sides, the same is taken-up for final disposal.

2. The appellant/complainant has filed this appeal

under Section 378(4) of Criminal Procedure Code, 1973 (

'Cr.P.C.' for short) challenging the judgment of acquittal

dated 25.10.2018 passed by the XVI Additional Chief

Metropolitan Magistrate Court, Bengaluru City ('trial Court'

for short) in CC No.1667/2017, whereby the learned

Magistrate has acquitted the accused for offence under

Section 138 of the Negotiable Instruments Act, 1881 ( 'NI

Act' for short).

3. For the sake of convenience, the parties herein

are referred with the original ranks occupied by them

before the trial Court.

4. The brief facts leading to the case are that, the

accused-P.R. Bhot was introduced to the complainant -

Ashok B. Dani by his friend Mr. B. Murthy Naik. Resident of

Shivanagara, Bengaluru. The accused has requested the

complainant for hand-loan in the last week of March 2013

in order to invest the same for establishment of an office

and to meet his other financial commitments. Then the

complainant has requested the accused to approach him in

the month of June, 2013 assuring him that by that time, he

would make some arrangements for loan. It is further

alleged that, as per request, on 05.06.2013, the

complainant paid a sum of Rs.10,50,000/- to accused with

interest at the rate of 18% per month, in presence of his

friend Sri. B. Murthy Naik. The accused has executed the

loan agreement in complainant's favour on the same day,

promising to repay the said loan amount within three

years. It is the further case that, in March 2016, the

complainant requested the accused for repayment of the

loan with interest and then, the accused issued a cheque

dated 15.04.2016 for a sum of Rs.15,00,000/- including

interest. When the said cheque was presented by the

complainant for encashment, it was dishonoured on

24.04.2016 with an endorsement as 'Refer to Drawer'. It is

further alleged that, the complainant got issued a legal

notice through Registered Post Acknowledgement Due

('RPAD' for short) and Speed Post on 24.05.2016 to the

last known address of accused and the notice returned with

postal endorsement 'No Such Person is residing in the

given address' and hence, it is a deemed service. As such,

the complainant claims that, he has filed complaint under

Section 200 of Cr.P.C. alleging that the accused has

committed an offence under Section 138 of the N.I. Act.

The learned Magistrate after taking cognizance, has

recorded the sworn statement of the complainant and

issued process against accused. The accused has appeared

through his counsel and was enlarged on bail. The

accusation was read-over and explained to accused, and he

pleaded not guilty.

5. The complainant himself was examined as PW.1

and placed reliance on twelve documents marked as C1 to

C12. After completion of evidence of prosecution, the

statement of accused under Section 313 of Cr.PC was

recorded, to enable him to explain the incriminating

evidence appearing against him in the case of prosecution.

The case of accused is of total denial. The accused has also

got examined himself as DW.1. However, it is also

important to note here that the complainant did not choose

to cross-examine the accused and the evidence of accused

remained unchallenged.

6. After hearing arguments of the learned counsels

appearing on both sides, the learned Magistrate has found

that, appellant/complainant has failed to establish his

financial status to advance loan amount and further failed

to prove the transaction of advancing of Rs.10,50,000/- and

as such, acquitted the accused for offence under Section

138 of the N.I. Act. Being aggrieved by this judgment of

acquittal, the complainant has filed this appeal.

7. Heard the arguments advanced by the learned

counsel appearing for the appellant/complainant and the

respondent/accused. Perused the records.

8. Learned counsel for appellant/complainant would

contend that the judgment of acquittal passed by the trial

Court is illegal, unjust and arbitrary. He would further

contend that the trial Court has failed to appreciate the

oral and documentary evidence placed before it in a proper

perspective and has not properly applied presumption

available in favour of the complainant under Sections 118

and 139 of the N.I. Act. He would also contend that the trial

Court has given unnecessary importance to irrelevant

factors and when the cheque belongs to accused and the

signature on cheque came to be admitted, the trial Court

ought to have drawn a presumption and ought to have

convicted the accused. But, the trial Court has erroneously

acquitted the accused, which has resulted in miscarriage of

justice. He would also contend that the notice was issued

to the last known address and it is a deemed service, and

accused has neither replied to notice nor repaid the

amount, and as such, ingredients of Section 138 of NI Act

are attracted and hence, he would contend that the trial

Court is erred in acquitting the accused. As such, he prayed

for allowing the appeal by setting aside the impugned

judgment of acquittal and sought to convict the accused.

      9.    Per     contra,         learned    counsel       for

respondent/accused      would        contend   that,     alleged

transaction of Rs.10,50,000/- is said to have taken place in

March 2013 and interest for the said amount is alleged to

have been charged at the rate of 18% per month. He

would also contend that the transaction has taken place in

presence of Mr. Murthy Naik. But, the said person was not

examined for the best reasons known to the complainant.

He would also contend that the pleadings itself disclose

that, though loan agreement was executed, it was not

produced. The financial capacity of the complainant was

challenged, and though he claimed that, he mobilized the

amount of Rs.10,50,000/- from his friend one Rajesh, his

wife and other family members, none of these witnesses

were examined. He would also invite attention of this Court

towards evidence of PW.1, which disclose that the

complainant was not at all acquainted with accused

including full name of the accused and hence, he would

contend that, it is hard to accept that complainant has paid

such a huge amount to an unknown person and as such,

he would contend that the trial Court is justified in

acquitting the accused. Hence, he would submit that the

impunged judgment of acquittal does not call for any

interference by this Court and prayed for dismissal of the

appeal.

10. Having heard arguments of the learned counsels

appearing on both sides and on perusing the records, it is

evident that the complainant has approached this Court

with a specific contention that he has advanced loan of

Rs.10,50,000/- to accused, with interest at 18% per month

in presence of one B. Murthy Naik. At the out-set, it is

important to note here that, complainant has not obtained

money lending licence so as to charge exorbitant interest at

18% per month. The complainant in his complaint itself

disclosed his status as a social and political leader being

Councilor for three terms from Gandhi Nagar, Bengaluru

and also a business man. He claims that, he is financially

well-established and in his examination-in-chief, he has

deposed in terms of complaint averments. But, the cross-

examination of PW.1 discloses that, he is not acquainted

with accused. He claims that he do not know the full name

of accused and he met him first time in December,2012 and

claims that he is not doing any money lending business. In

that event, question of he charging exorbitant interest at

the rate of 18% per month does not arise at all. He also

admits that, accused is neither his classmate nor his

neighbour and he do not know the native place of accused,

his age, father's name and his background. If this

admission is taken into consideration, it is hard to believe

that the complainant has advanced a huge amount of

Rs,.10,50,000/- to such a person, whom he do not know at

all, without there being any material security. The manner

of the complainant charging interest at 18% per month

would clearly disclose that, he is involved in money lending

business.

11. Further, all along the complainant claims that,

accused met him with one B.Murthy Naik, who is working in

Police Department in Bengaluru City. He pleads ignorance

regarding financial transaction between said B.Murthy Naik

and in his initial cross-examination, the complainant claims

that, he arranged Rs.4,50,000/- from his friend one Mr.

Rajesh and balance amount of Rs.5,50,000/- from his

family members. But, in subsequent cross-examination, he

claims that his friend Rajesh paid Rs.4,50,000/- to him and

he received Rs.2,50,000/-from his wife and the balance

amount was arranged by him from his income. If this

version is taken into consideration, it is evident that he had

no financial capacity to pay Rs.10,50,000/- as on the said

date. Further, to prove that his friend Rajesh has paid him

Rs.4,50,000/- and he received Rs.2,50,000/- from his wife,

the said persons were not at all examined. Further, it is

the specific contention of the complainant that he advanced

loan in presence of said B. Murthy Naik and that person was

also not examined.

12. Further, during cross-examination of PW.1, it is

suggested that, accused has availed loan of Rs.1,00,000/-

from B. Murthy Naik in the year 2013 and at that time, B.

Murthy Naik had collected eight Bank Cheques from

accused including the cheque-Ex.P1. But, interestingly the

complainant has not denied this fact and pleaded ignorance.

The defence of accused is very specific that, he had availed

loan of Rs.1,00,000/- from B. Murthy Naik, who was

working in Police Department and the said Murthy Naik has

obtained eight blank cheques including the disputed

cheque in this case from accused and also obtained

signatures on blank stamp papers and that have been

misused by accused in collusion with B. Murthy Naik. Very

interestingly, the complainant has not denied this specific

defence. The cross-examination of complainant discloses

that, he does not know anything about accused. His

financial status is also exposed and he has not led any

material evidence to show as to how he mobilized such a

huge amount by examining the relevant witnesses. Even

though the complainant claimed that, he paid the said loan

amount in presence of Murthy Naik, the said witness would

have been the best witness to the alleged transaction in the

given circumstances, but he was not examined.

13. Apart from that, the accused himself has got

examined as DW.1 and he has set-up similar defence in

examination-in-chief regarding borrowing loan of

Rs.1,00,000/- from B. Murthy Naik and he denied borrowing

loan of Rs.10,50,000/- from complainant. Interestingly, the

complainant has not challenged the evidence of DW.1 by

way of cross-examination. The evidence of accused

remained unchallenged and his defence also remained

unchallenged. During cross-examination, PW.1-complainant

has not denied the defence of accused, but pleaded

ignorance. The material evidence on record does disclose

that complainant was not acquainted with accused and his

background. The financial status of complainant is also

exposed. Further, the complainant charging exorbitant rate

of interest at 18% per month, which is not permissible, as

he has not obtained any licence in this regard for carrying

money lending business. Apart from that, the complainant

all along asserted that, at the time of availment of loan,

accused has also executed an agreement. Interestingly,

the said agreement was also not placed on record by the

complainant and thereby he has withheld the meterial

evidence in this regard. As such, an adverse inference is

required to be drawn against the complainant. When the

complainant does not know about personal as well as family

background of accused including the name of the father of

accused, it is hard to accept that he had advanced a huge

loan of Rs.10,50,000/- to such a stranger, with whom he

first time met in the month of December, 2012. Further,

though he claimed that he has taken some amount from

his friend Rajesh and his wife, they were also not examined

to prove that, the complainant has mobilized any amount.

The alleged transaction is said to have taken place in

presence of B. Murthy Naik and non-examination of this

material witness is fatal to the case of complainant. Even he

has not produced the alleged loan agreement and even the

defence of accused is also not challenged by the

complainant by way of cross-examination.

14. The learned Magistrate has appreciated the oral

and documentary evidence in detail and arrived at a just

decision. Hence, considering the all the above said aspects

and when the financial status of complainant is disputed,

the presumption under Section 139 of NI Act is not

available in favour of complainant. Hence, the complainant

has failed to establish advancement of loan to accused and

he has also charged exorbitant interest and material

agreement in this regard is not produced. Hence, the

complainant has failed to establish that the cheque under

Ex.C1 was issued towards legally enforceable debt as

claimed by him. The learned Magistrate, considering all

these aspects has rightly acquitted the accused and as such

the judgment of acquittal passed by the trial Court is

neither perverse nor capricious so as to call for any

interference by this Court. Hence, the appeal is devoid of

any merits and needs to be rejected. Accordingly, I

proceed to pass the following:-

ORDER

The appeal is dismissed. The judgment of acquittal dated 25.10.2018 passed by the trial Court viz., XVI Additional Chief Metropolitan Magistrate, Bengaluru, in CC No.1667/2017, stands confirmed.

Sd/-

JUDGE

KGR*