Mr. Krishne Gowda vs M. S. Lingaiah
2022 Latest Caselaw 8103 Kant

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

       DATED THIS THE 3RD DAY OF JUNE 2022

                           BEFORE

THE HON'BLE Dr. JUSTICE H.B.PRABHAKARA SASTRY

  CRIMINAL REVISION PETITION No.1465 OF 2018

BETWEEN:

MR.KRISHNE GOWDA,
S/O LATE VENKATE GOWDA,
AGED 66 YEARS,
NO.11, SRI LAKSHMIPUR ROAD,
SIDDANAHOSAHALLI,
MADANAYAKANAHALLI,
NEAR KALYANA MANTAPA,
BANGALORE-562 123.
                                               ...PETITIONER
(SRI MANJUNATH B.R., ADV.,)


AND:


M.S.LINGAIAH,
S/O LATE SIDDAIAH,
AGED 69 YEARS,
R/AT NO.226, 3RD BLOCK
2ND STAGE, NAGARABHAVI,
BANGALORE-560 072.
                                                ...RESPONDENT
(SRI K.S.CHANDRAKANTH GOWDA, ADV.,)


     This Criminal Revision Petition is filed under Sections 397
and 401 Cr.P.C. praying to set aside the order of conviction and
sentence dated 27.03.2017 passed by the XVI Additional
C.M.M., Bengaluru, in C.C.No.15633/2015 and also set aside
                                                   Crl.RP.No.1465/2018
                                 2


the judgment dated 26.10.2018 passed by the LXV Additional
City Civil and Sessions Judge, Bengaluru, in Crl.A.No.579/2017
and consequently acquit the petitioner.

      This Criminal Revision Petition having been heard through
Physical Hearing/Video Conferencing and reserved on
25.05.2022 coming on for pronouncement of orders this day,
the Court made the following:

                             ORDER

The present petitioner was accused in

C.C.No.15633/2015, in the Court of the learned XVI Additional

Chief Metropolitan Magistrate, Bengaluru City (hereinafter for

brevity referred to as the "trial Court"). By its judgment dated

27.03.2017, the trial Court convicted the accused for the

offence punishable under Section 138 of Negotiable Insturments

Act, 1881 (hereinafter for brevity referred to as the "N.I. Act")

and was sentenced accordingly.

2. The summary of the case of the complainant in the

trial Court is that he is a retired Director in the Ministry of

Labour, Director General of Employment and Training about 15

years ago. While he was under service at Foreman Institute,

Bengaluru, he came in contact with the accused who was

working there as a Security Guard. They developed

acquaintance between them since both of them hail from Crl.RP.No.1465/2018

Karnataka. The accused apart from working as a Security

Guard was also doing real estate business and had rented out

his two cars to Travels.

It is further the case of the complainant that he retired

from services on 31.05.2009 and received a sum of `10 lakhs

as retirement benefits and the accused also retired from service

in September, 2012. After his retirement, the accused

approached him for monetary help for his business needs in the

month of February 2011 and availed a hand loan of `9.50 lakhs

from him on 25.02.2011 after executing one demand

promissory note and promised to repay the loan amount within

30 days. Since the accused did not keep up his promise and

did not repay the loan amount at the repeated request of the

complainant, the accused issued a cheque in a sum of

`9.50 lakhs dated 25.03.2013 bearing Cheque No.552335 drawn

in favour of the complainant on the Bank of Baroda, APMC Yard

Branch, Bengaluru, towards clearance of his dues to the

complainant.

The complainant has further stated that when he

presented the said cheque to his Banker on 25.03.2015 for its

realisation, the same came to be returned dishonoured with an

endorsement "funds insufficient" on 27.03.2013. The Crl.RP.No.1465/2018

complainant got issued a legal notice dated 10.04.2013 to the

accused demanding payment of the cheque amount. However,

in spite of service of legal notice, the accused neither paid the

cheque amount nor replied to the legal notice, which

constrained the complainant to institute a case against him in

the trial Court in C.C.No.15633/2015 for the offence punishable

under Section 138 of N.I. Act.

3. Since the accused pleaded not guilty, charges were

framed against the accused for the alleged offences.

4. In order to prove the alleged offence against the

accused, the complainant got examined himself as PW1 and got

marked documents at Exs.P1 to P14. The accused examined

himself as DW1 and got marked document at Exs.D1 and D1(a).

5. After hearing both side, the trial Court by its impugned

judgment dated 27.03.2017, convicted the accused for the

offence punishable under Section 138 of the N.I. Act and

sentenced him accordingly.

6. Challenging the said order, the accused has preferred

an appeal in Criminal Appeal No.579/2017 before the Court of Crl.RP.No.1465/2018

LXV Additional City Civil and Sessions Judge, Bangalore City

(hereinafter for brevity referred to as `Sessions Judge's Court),

which by its judgment dated 26.10.2018 dismissed the appeal

by confirming the judgment of conviction passed by the trial

Court. It is against these judgments of conviction, the accused

has preferred this appeal.

7. The respondent is being represented by the learned

counsel.

8. Records from the Trial Court and Sessions Judge's

Court pertaining to the matter were called for and the same

are placed before the Court.

9. Heard the arguments from both side. Perused the

materials placed before this Court.

10. The only point that arises for my consideration is,-

"Whether the impugned judgments suffer from perversity, illegality, impropriety warranting any interference at the hands of this Court".

Crl.RP.No.1465/2018

11. Learned counsel for the petitioner, in his arguments,

submitted only on two points. That the complainant had no

financial capacity to lend such a huge amount of money as loan

and that the cheque in question was given by the accused to

the complainant as a security towards a previous loan

transaction in a sum of `1,70,000/- availed by the accused from

the complainant. The said cheque even after the repayment of

the loan was not returned by the complainant but was misused

in the present form.

12. Learned counsel for the complainant/respondent, in

his arguments submitted that the accused has failed to

establish that the cheque in question was in his possession as

on 03.03.2010. As such, the question of he giving the said

cheque as a security to the complainant towards the previous

loan transaction does not arise. He further submitted that in

the preliminary cross-examination of PW1, the accused has

made a suggestion to PW1 that he has repaid the loan amount

before and after issuance of notice to him, however, in the trial,

the accused has come up with a different plea of the alleged

clearance of all the dues prior to the issuance of notice to him

but not thereafter. As such, there is variation. With this, he Crl.RP.No.1465/2018

submitted that the impugned judgment does not warrant any

interference at the hands of this Court.

13. It is an admitted fact that the complainant and the

accused were known to each other since while the complainant

was working as a Director in the Ministry of Labour, Director

General of Employment and Training at Foreman Institute,

Bengaluru, the accused was working there as a Security Guard.

It is also not in dispute that the cheque in question which is at

Ex.P1 has been drawn by the accused and that the said cheque

when presented for its realisation by the complainant came to

be returned unpaid for the reason of insufficiency of funds as

per the Banker's memo at Ex.P2. It is also not in dispute that

after the dishonour of the cheque, the complainant got issued a

legal notice to the accused as per Ex.P3 and the said notice was

duly served upon the drawee, as could be seen at postal receipt-

Ex.P4 and postal acknowledgment-Ex.P5. In the light of these

admitted facts, a presumption forms in favour of the complainant

under Section 139 of the NI Act about the existence of legally

enforceable debt. However, the said presumption is rebuttable.

14. The complainant, apart from contending that the accused

borrowed a sum of `9.50 lakhs from him on the date 25.02.2011 Crl.RP.No.1465/2018

has also stated that in that regard the accused had executed an

on Demand Promissory Note in his favour, which promissory

note the complainant had got marked at Ex.P6. In order to

show that he had sufficient income and also as the proceeds of

provident fund account with him, has produced the copies of his

Bank Statement, General Provident Fund bill, the final payment

letter etc., from Exs.P7 to P14. The accused, apart from getting

himself examined as DW1, has also got marked a copy of his

bank pass book at Ex.D1 and an entry therein at Ex.D1(a).

14.A. The accused, in the cross-examination of the

complainant who got himself examined as PW1, has not denied

that he was the drawer of the cheque at exhibit P1 and the

same came to be dishonoured when presented for realisation,

for the reasons of insufficiency of funds. He has also not denied

that the Demand Promissory Note at exhibit P6 bears his

signature as executant. However, it is his specific defense

which he has taken in the cross-examination of PW1 as well in

his evidence as DW1 that he had cleared all his dues towards

the complainant. The alleged Demand Promissory Note and

cheque at Ex.P1, were signed in blank by him when he had

availed a loan of `1,70,000/- from the complainant on the Crl.RP.No.1465/2018

date 03.03.2010. The complainant as a security had obtained

those two documents from him but failed to return those two

documents even after repayment of loan of `1,70,000/- to the

complainant which is evidenced in the passbook entry of the

accused at Ex. D1(a) and also in the very document, which is

bank account passbook of the complainant produced by himself

at Ex.-P13. However, without returning the blank cheque and

the Demand Promissory Note given by the accused to him, the

complainant misused them by filling those documents by

himself showing the alleged loan amount of rupees `9,50,000/-

when in fact no such loan transaction for rupees `9,50,000/-

had ever been taken place between them. Suggestions to this

effect were made from the accused side in the cross-

examination as well the accused as DW1 in his evidence also

reiterated the same but the complainant has not admitted any

of those suggestions and denied the evidence of DW1 in that

regard.

15. Apart from taking contention of denial of alleged

loan transaction and contending that the cheque in question

being given to the complainant only as a security purpose

towards a previous loan transaction, the accused had also taken Crl.RP.No.1465/2018

a contention that the complainant had no financial capacity to

lend such a huge amount of money. In that regard, several

questions were put to PW1 in his cross-examination from the

accused side and several statements were elicited from the

witness.

16. It was elicited in the cross-examination of PW.1

from the accused side that the complainant while in service was

trapped by the Central Bureau of Investigation in the year 2005

and that the complainant was suspended from the service.

It was suggested to the witness that he was trapped while

accepting a bribe. The witness also stated that the litigation

pertaining to his trap is pending in the High Court of Judicature

at Kolkata in the form of an appeal challenging the

judgment of Special Court which was against him.

Thus, regarding the conduct of the complainant the accused

could able to bring a fact that the complainant had a

stigma which according to the accused was with respect

to alleged corruption while under service.

17. In order to rebut the presumption formed in favour

of the complainant about the existence of the legally

enforceable debt, the accused had taken a plea that the Crl.RP.No.1465/2018

complainant had no financial capacity to lend such a huge

amount of `9,50,000/- as a hand loan to him. In that regard,

PW.1 was subjected to a detailed cross-examination wherein

several questions were put to the witness regarding his financial

capacity. The summary of the evidence of PW1 in that regard

was that the complainant from the year 2003 to 2009 had

taken an amount of more than `6,00,000/- towards his general

Provident fund account, group insurance, leave encashment and

arrears of pension all put together in total a sum of

`11,45,663/- has been received by him. He has also stated that

he has performed the marriage of his two daughters and has

spent a sum of `6,00,000/- towards marriage expenses.

Even though, it was the case of the complainant that the

alleged loan of `9.5 lakhs said to have paid to the accused was

in the form of cash and that he (complainant) had maintained

such cash amount with him in his house but PW1 in his

cross-examination could not able to give the details as to when

he had drawn so much of money from his bank account and had

kept the same in the form of cash at his house. It was because

as has come out in his evidence that he being a Central

Government employee was getting his salary being credited to Crl.RP.No.1465/2018

his bank account and certain amounts like General Provident

Fund amount was received by him in the form of Demand Draft

which he encashed through his banker, as such there was no

possibility of he having any cash income and retaining the same

in his house.

Furthermore, as has come out in the very same

cross-examination of PW1 as per Ex.P12 which is a notarized

copy of his bank statement. The bank balance in his account as

on the date 31.03.2010 was only a sum of `19646.56 ps.

Though the witness has voluntarily stated that the said amount

was credited by him to his bank account and it is not the total

balance in his account but Ex.P12, the statement of his account

shows the said sum of ` 19646.56 ps. not as a credit amount

but as a total balance standing in his bank account on the said

date. Therefore, the said statement of the complainant that his

bank account had sufficient balance is a mere oral

statement bereft of any corroborative documentary evidence.

Crl.RP.No.1465/2018

18. PW.1 has further stated in his evidence that in order

to show on which are all the dates he has drawn money from

the bank and kept the same in his house, he has produced

documents at Exs.P12 and 13. However, as analysed above,

those two documents, which are the bank statement from the

date 1.4.2009 to 31.3.2010 at Ex. P12 and the notarised copy of

the bank pass book of the petitioner with the Corporation Bank,

Nagarabhavi branch, Bengaluru though shows certain debit and

credit entries but by those entries itself it cannot be made out

as to how much of the amount the complainant had withdrawn

as cash and retained it in his house only to enable him to lend

to the accused. Ex.P12 since being for a period ending nearly

one year earlier to the alleged loan transaction, it cannot be

inferred that the complainant had made any request for loan

pending with him or anticipated that he may have to lend loan

to the accused on 25.2.2011 and as such he had withdrawn the

money and kept it with him. Similarly, the entries at Ex.P13 though

covers the period of the alleged loan transaction which is the dated

25.2.2011 but there is no debit entry for a sum of `9,50,000/- or

any amount nearer to that in the near vicinity of the date of the

alleged loan i.e., 25.02.2011 by which it can be inferred that the

complainant had withdrawn the amount from his bank and kept Crl.RP.No.1465/2018

the said amount with him. For that matter, for more than one

year prior to the alleged loan transaction at no point of time the

complainant had bank balance equivalent to the alleged loan

amount as could be seen from Exs.12 and 13. Therefore, the

very evidence of PW1 that he had withdrawn the amount from

the bank and kept the same at his home to lend it to the

accused is not believable.

In addition to the above, as elicited in the cross

examination of PW1, several of the entries at Exs.13 and 14

mentions about the investment made by the complainant in

different establishments including in post office, M/s. Gauda

Gares etc. The complainant has admitted in his cross-

examination that about `12 lakhs he has invested in different

establishments. Thus, when he has invested huge amount of

money in different establishments while nearing to his

retirement from his service and immediately thereafter, it is

difficult to believe that he still had sufficient balance in his bank

account and that he withdrew the same and kept it in his house. It

further creates a serious doubt as to whether the complainant had

financial capacity to lend such a huge amount to the accused.

19. PW.1, in his cross-examination, has also stated that

he has not shown the alleged loan transaction in his Income Tax Crl.RP.No.1465/2018

Returns. He has also stated that had he given loan to the

accused, there was no difficulty for him to reflect the same in

his Income Tax Returns. Thus, the accused could able to

imbibe a serious doubt in the alleged financial capacity of the

complainant to lend money which in the facts and

circumstances of the case would be sufficient to hold that the

presumption formed in favour of the complainant under section

139 of the N.I. Act has stood rebutted.

20. It is the defense of the accused that he had availed

a loan for a sum of `1,70,000/- from the complainant on the

date 03.03.2010, at that time the complainant had obtained a

blank but duly signed check from the accused as well a blank

but duly signed pronote by the accused. In that regard, though

suggestions were made to PW1 in his cross-examination the

same were not admitted as true by the witness. The evidence

given on the lines of his defence by the accused as DW1 was

also denied in his cross-examination from the complainant side.

However, PW1 has admitted in his cross-examination that

handwriting in those two documents are his handwriting but

added to it that it was at the request of the accused he himself

has filled those documents.

Crl.RP.No.1465/2018

21. The most interesting aspect is that the complainant

has denied that the accused had taken a loan of `1,70,000/-

from him on 03.03.2010. In the very same cross-examination,

in the previous sentence the very same witness has stated that

prior to the loan transaction in question, there were financial

transactions between him and the accused between the years

1994 and 2002. However, at no point of time the amount was

exceeded `50,000/-.

22. Thus, according to PW1 (complainant) after the

financial transaction between the year 1994 and 2002 the next

financial transaction which was in the form of loan transaction

was the present alleged loan transaction dated 25.02.2011.

Thus, between September 2002 and February 2011 it is to be

inferred that there was no loan transaction. Probably for said

reason PW1 one denied that there was any loan transaction

between him and the accused on the date 03.03.2010

amounting to a sum of `1,70,000/-.

After stating as above, when the witness was

confronted with his own bank passbook at Ex.P13 and credit

entry of `1,70,000/- in the form of payment and the Cheque

No.524096 drawn on the Bank of Baroda on date 03.12.2010 Crl.RP.No.1465/2018

was shown and was suggested that the accused has borrowed

loan of `1,70,000/- on 03.03.2010 and the same was repaid to

the complainant on 03.12.2010 under the Cheque No.520496,

the witness again modified his stand and stated that the said

check was given to him by somebody else .

24. The accused(petitioner) in his evidence as DW1

produced his bank passbook of the Bank of Baroda and got it

marked as Ex.D1. The relevant entry dated 03.12.2010 was

marked Ex.D1 which was showing that cheque bearing

No.524096 for a sum of `1,70,000/- drawn in favour of Sri

M.S.Lingaiah (present complainant) was debited in the account

of the accused. It is the very same cheque number and the

amount on the same day has been shown as an amount

credited in the bank account of the complainant as was noticed

in Ex.P13. It is thereafter the complainant came up with a new

story in the form of suggestion to DW1 suggesting that the

payment of `1,70,000/- made by him to (DW1/accused) on

03.12.2010 in favour of the complainant was in respect of the

loan of `3.5 lakhs on 29.10.2010.

25. The above statements in the form of statement

made in examination-in-chief and cross-examination by the Crl.RP.No.1465/2018

complainant as PW1 and the suggestions made to DW1 in his

cross-examination and the replies elicited would clearly go to

show that at one breath the complainant has stated that after

September, 2002 till the present, loan transaction which

according to him is dated 25.02.2011 there was no loan

transaction. In the second breath, he has denied that the

accused has paid him a sum of `1,70,000/- on 03.12.2010 but

stated that the said amount of credit entry in his (complainant)

Bank account date 03.12.2010 was by somebody else.

Subsequently, it was given a go-bye and in evidence of DW1 he

has admitted that after the accused came up with his bank pass

book at Ex.D1 and shown the corresponding entry for the

payment of `1,70,000/- in his account, the complainant

changed his version and came up with a different story stating

that the said payment was towards loan of `3.5 lakhs on

29.10.2010.

According to the complainant himself, after September,

2002 till the present, loan transaction in the month of February,

2011 if there were no loan transaction between them, then how

can a loan of `3.5 lakhs on the date 29.10.2010 gets an entry for

the first time in the cross-examination of DW1. This would

clearly go to show that the complainant has not approached the Crl.RP.No.1465/2018

Court with clean hands. In this background, the mere non-

production of any documents by the accused to show that the

cheque book in the series of cheque number at Ex.P1 was issued

to him and was in possession as on the date 03.03.2010 would

prove the case of the complainant is unacceptable. When the

accused in the manner analysed above, from more than one angle,

has imbibed serious doubt both with respect to the alleged loan

transaction as well as the financial capacity of the complainant to

lend such a huge amount of money by keeping such a huge

amount in the form of cash with him, without any hesitation it can

be held that the accused has successfully rebutted the

presumption in favour of the complainant under Section 139 of

N.I. Act.

The above finding also gains support from the circumstances of

the case that admittedly the complainant and the accused were

working for quite some time in the same office i.e., Ministry of

Labour, Director General of Employment and Training. At that time,

since both were hailing from the State of Karnataka developed

acquaintance between them. Admittedly, the complainant was in a

very high position as the Director, Ministry of Labour, Director General of

Employment and Training, Government of India whereas the accused

being an Ex-Army person was only a Security Guard. Admittedly, Crl.RP.No.1465/2018

there were several financial transaction between them where it

always the accused was the borrower and the complainant was

the lender. As such, when the complainant as a superior in the

office has asked the accused to give him a blank cheque and

pronote, in all probability the accused might have given those

two documents, which subsequently was misused by the

complainant in the form of Cheque at Ex.P1 and on Demand

Pronote at Ex.P6. Furthermore, admittedly, the complainant

apart from being trapped by the CBI has also suffered an order

against him by the Special Court and as on the date of his

evidence his appeal before the High Court of Judicature at

Kolkata was pending. Thus, the circumstances also go to show

that the defense of the accused appears to be more probable

and near to the truth than the versions made in the complaint of

the petition. However, both the trial Court as well as the

Sessions Judge's Court without noticing the evidence placed

before them in their proper perspective have in a hasty manner

relied upon the memo of dishonour of cheque, legal notice and

admission on the part of the accused that the cheque and

Demand Promissory Note were signed by him, have straightaway

jumped to a conclusion that the complainant has proved the

alleged guilt against the accused. Since the said finding of Crl.RP.No.1465/2018

both the Courts below now proved to be perverse and

erroneous, it deserves to the set aside and the accused

deserves to be acquitted of the alleged offence. Accordingly, I

proceed to pass the following:

ORDER

The Criminal Revision Petition stands allowed. The

judgment of conviction and order on sentence passed in

C.C.No.15633/2015, by the Court of the learned XVI Additional

Chief Metropolitan Magistrate, Bengaluru City and the Judgment

dated 26.10.2018 passed in Crl.A.No.579/2017 stands set

aside.

Accused-Krishne Gowda son of Late Venkate Gowda

residing at No.11, Sri Lakshmipur Road, Siddanahosahalli,

Madanayakanahalli, Near Kalyana Mantapa, Bangalore-562 123,

stands acquitted from the offence punishable under Section

138 of the N.I. Act.

Registry to transmit a copy of this order to both the trial

Court and as also to the Sessions Judge's Court along with their

respective records immediately.

Sd/-

JUDGE TL