S E Vijay vs H Manjappa
2023 Latest Caselaw 7191 Kant

                                1




       IN THE HIGH COURT OF KARNATAKA AT BENGALURU

           DATED THIS THE 11TH DAY OF OCTOBER, 2023

                        BEFORE

              THE HON'BLE MRS.JUSTICE M.G. UMA

         CRIMINAL REVISION PETITION NO.1305/2019
                               C/W
         CRIMINAL REVISION PETITION NO.113/2020

BETWEEN:
S.E. VIJAY
SON OF S.M. ESHWARAPPA
AGED 46 YEARS
RESIDING AT NO.559
SECOND 'B' CROSS
THIRD BLOCK, THIRD STAGE
BASAVESHWARNAGAR
BANGALORE - 560 079
                                          ... COMMON PETITIONER
(BY SRI: VENKATRAMANA .M.K., ADVOCATE)

AND:
H. MANJAPPA
SON OF LATE BASAPPA
AGED 75 YEARS
RESIDING AT 1010, 2(I) CROSS
THIRD BLOCK, THIRD STAGE
BASAVESHWARNAGAR
BANGALORE - 560 046
                                         ... COMMON RESPONDENT

(BY SRI: KULKARNI RAGHAVENDRA ANNARAO, ADVOCATE)

CRIMINAL REVISION PETITION NO.1305 OF 2019 IS FILED UNDER SECTION 397 READ WITH SECTION 401 OF CR.P.C. PRAYING TO SET ASIDE THE JUDGMENT DATED 30.08.2019 PASSED IN CRL.A.NO.779/2017 ON THE FILE OF THE LII ADDITIONAL CITY CIVIL AND SESSIONS JUDGE, BENGALURU CITY AND TO SET ASIDE THE JUDGMENT/ORDER OF CONVICTION DATED 25.04.2017 PASSED IN C.C.NO.25789/2012 ON THE FILE OF THE FILE OF THE XXV A.C.M.M.,

BENGALURU BY ALLOWING THE ABOVE RP BY ACQUITTING THE PETITIONER.

CRIMINAL REVISION PETITION NO.113 OF 2020 IS FILED UNDER SECTION 397 READ WITH SECTION 401 OF CR.P.C. PRAYING TO SET ASIDE THE JUDGMENT DATED 30.08.2019 PASSED IN CRL.A.NO.1026/2017 ON THE FILE OF THE LII ADDITIONAL CITY CIVIL AND SESSIONS JUDGE, BENGALURU CITY CCH-53 BY ALLOWING THE ABOVE RP BY ACQUITTING THE PETITIONER.

THESE CRIMINAL REVISION PETITIONS HAVING BEEN HEARD AND RESERVED FOR JUDGMENT ON 20.09.2023 COMING ON FOR PRONOUNCEMENT OF ORDERS THIS DAY, THE COURT PASSED THE FOLLOWING:

COMMON ORDER

The accused in CC No.25789 of 2012 on the file of the

learned XXV Additional Chief Metropolitan Magistrate, Bengaluru

(hereinafter referred to as 'the Trial Court' for brevity), is

impugning the judgment of conviction and order of sentence

dated 25.04.2017 convicting him for the offence punishable

under Section 138 of the Negotiable Instruments Act (for short

'NI Act') and sentencing to pay fine of Rs.15,02,000/-, which

was enhanced vide judgment dated 30.08.2019 passed in

Criminal Appeal No.1026 of 2017 preferred by the complainant

on the file of the learned LII Additional City Civil and Sessions

Judge, Bengaluru City (CCH-53), (hereinafter referred to as 'the

First Appellate Court'), while dismissing Criminal Appeal No.779

of 2017 preferred by the accused.

2. The accused is challenging the dismissal of Criminal

Appeal No.779 of 2017 by preferring Criminal Revision Petition

No.1305 of 2019 and the judgment modifying the order of

sentence passed in Criminal Appeal No.1026 of 2017 by

preferring Criminal Revision Petition No.113 of 2020.

3. Brief facts of the case are that, the complainant has

filed private complaint in PCR No.140011 of 2012 before the Trial

Court against the accused alleging commission of offence

punishable under Section 138 of NI Act. It is contended that he

is a retired Central Government employee having monthly

pension. With an intention to start small business for the benefit

of his unemployed son, the complainant wanted to invest in

some business. The accused was owning a proprietary concern

by name M/s.Toon Zone, a franchise of Ants Studio Pvt. Ltd. The

father of the accused was having acquaintance with the

complainant and it is stated that the accused is doing extremely

well in the said business and lured the complainant to invest in

the business of his son. Accordingly, the complainant agreed to

invest as he was promised of huge percentage of business profit.

It was agreed that the proprietary concern run by the accused

would be converted into partnership business. The complainant

invested an amount of Rs.25,00,000/- by mortgaging his house

property by way of reverse mortgage. An equal amount of

contribution was said to have been made by the accused and his

father. A partnership deed was entered into on 16.01.2009. It

was registered on 02.02.2009 before the Registrar of partnership

firm.

4. It is contended by the complainant that prior to

registration of partnership firm, the father of the accused got an

agreement dated 20.01.2009 signed by him, complainant and

the accused undertaking to transfer the proprietorship business

into a partnership firm for a total capital of Rs.50,00,000/-. The

accused has acknowledged the receipt of Rs.25,00,000/-

towards transfer of infrastructure and the franchise license and

other list of items mentioned in Annexure-A attached with the

agreement. But the accused has never transferred any of those

items as undertaken. The accused and his father started showing

hostile attitude towards the complainant. The partnership

business was never took off. No joint bank account was opened

in the name of the firm. The accused managed to get back his

money from the proprietary concern from out of the amount that

was invested by the complainant. The complainant realised that

the accused with the help of his father managed to create a

bogus partnership firm with ulterior motive to make wrongful

gain.

5. It is contended that when the accused and his father

have not heeded to the request made by the complainant, he

was forced to file a criminal complaint which was registered in

Crime No.42 of 2012 of Jayanagar Police Station on 22.02.2012.

The police have undertaken investigation in the matter. When

the investigation was undertaken, the accused has expressed his

willingness to settle the dispute amicably and voluntarily came

forward and issued the post dated cheque on 05.03.2012

bearing No.683976 dated 14.06.2012, for Rs.15,00,000/- drawn

on HDFC Bank, Jayanagar Branch, towards payment of portion of

the amount which was invested by the complainant. When the

cheque was presented for encashment, the same was

dishonoured as account closed. The complainant issued the

legal notice to the accused informing him about dishonour of

cheque and calling upon to pay the cheque amount. Even

though, the notice was served on the accused, he has not repaid

the cheque amount, but issued a reply taking untenable

contentions. Therefore, the complainant requested the Trial

Court to take cognizance of the offence and to initiate legal

action against the accused.

6. The Trial Court took cognizance of the offence and

registered CC No.25789 of 2012 and summoned the accused to

appear before the Court. The accused appeared before the

Court and pleaded not guilty for the accusation made against

him. The complainant examined himself as PW1 and got marked

Exs.P1 to P8. The accused examined DWs.1 and 2 and got

marked Exs.D1 to D16 in support of his defence. The Trial Court

after taking into consideration all these materials on record

proceeded to pass the impugned judgment of conviction by

convicting the accused for the offence punishable under Section

138 of NI Act and sentencing him to pay fine of Rs.15,02,000/-.

7. Being aggrieved by the same, the accused has

preferred Criminal Appeal No.779 of 2017 before the First

Appellate Court. The complainant has preferred Criminal Appeal

No.1026 of 2017 being aggrieved by the insufficiency of fine

amount imposed on the accused. The First Appellate Court on

re-appreciation of the materials on record disposed off both the

appeals by common judgment dated 30.08.2019, dismissing

Criminal Appeal No.779 of 2017, allowing Criminal Appeal

No.1026 of 2017, modifying the order of sentence passed by the

Trial Court and enhancing the fine amount to Rs.20,00,000/-

with interest at 18% per annum over the cheque amount from

the date of receipt of cheque till its payment.

8. Being aggrieved by the same, the accused has

preferred these two criminal revision petitions.

9. Heard Sri M K Venkataramana, learned counsel for

the revision petitioner and Sri Raghavendra A Kulkarni, learned

counsel for the respondent. Perused the materials including the

Trial Court records.

10. Learned counsel for the revision petitioner contended

that the accused had never borrowed any loan from the

complainant. The complainant has not proved the existence of

legally recoverable debt. Even though, the accused admits that

Ex.P1 - cheque belongs to his bank account and it bears his

signature, the same was not issued towards legally recoverable

debt. Since there was business transaction between the

complainant and the accused, and the complainant was running

a partnership firm with the father of the accused and since the

accused was working as an Executive in the said partnership

business, he issued the cheque in question as security. The

complainant has misused the said blank cheque and presented

the same for encashment. The cheque was not dishonoured as

there was insufficient funds, but it was dishonoured as account

closed. Therefore, Section 138 of NI Act would not apply to the

facts of the case.

11. Learned counsel for the revision petitioner submitted

that Ex.D2 is the agreement entered into between the

complainant and father of the accused, whereunder, the

complainant had undertaken to invest Rs.25,00,000/- in the

partnership business, but he paid only Rs.15,00,000/-. An

amount of Rs.10,00,000/- is still due to be paid by the

complainant. In the meantime, the complainant filed PCR

No.1662 of 2012 against the father of the accused, who is one

of the partners of the firm, alleging commission of offences

punishable under Sections 417, 418 and 420 of IPC. The matter

was referred for investigation in Crime No.42 of 2012 of

Jayanagar Police Station and after investigation 'B' report came

to be filed. In the meantime, the complainant filed the

complaint before the Consumer Forum for recovery of

Rs.10,00,000/- from the accused. All these developments

disclose that the relationship between the accused and the

complainant was strained. Under such circumstances, it cannot

be believed that the accused had issued the cheque as per Ex.P1

towards legally recoverable debt.

12. Learned counsel submitted that Ex.D3 is the

partnership deed between the complainant and the father of the

accused; Ex.D1 is Form-C registering the partnership firm and

Ex.D2 dated 20.01.2009 is the agreement admittedly entered

into between the complainant and the father of the accused;

Ex.D4 is the letter evidencing the fact that the father of the

accused had availed loan of Rs.66,00,000/- by reverse mortgage

for the purpose of investing in the partnership firm. Ex.D15 is

the sale agreement dated 01.04.2009. All these documents go

to show that the complainant even though agreed to invest

Rs.25,00,000/-, had invested only Rs.15,00,000/- and when the

balance amount of Rs.10,00,000/- was demanded, he misused

the blank cheque issued by the accused and presented it for

encashment. Exs.D1 to 3 are the admitted documents as the

same were marked through PW1. He admits that the cheque -

Ex.P1 was issued by the accused in the Police Station. Under

such circumstances, no credence could be given to Ex.P1.

13. Learned counsel submitted that the complainant had

requested the accused to issue a blank cheque of his personal

account as security till completion of the sale transaction.

Accordingly, the accused issued the blank cheque on 06.01.2009

which was misused by the complainant. The accused and his

father are examined before the Trial Court as DWs.1 and 2.

Even though, the complainant has failed to prove his contention

of lending the amount and existence of legally recoverable debt,

the accused is successful in proving his defence that a blank

cheque as per - Ex.P1 was issued as security and the same was

misused by the complainant. The Trial Court and the First

Appellate Court have not considered any of these facts and

circumstances, and the admitted documents but proceeded to

convict the accused, without any basis.

14. Learned counsel further submitted that the First

Appellate Court proceeded to allow the Criminal Appeal No.1026

of 2017 filed by the complainant and enhanced the fine amount

to Rs.20,00,000/- with interest at 18% p.a. from the date of

receipt of the cheque till payment. The First Appellate Court

failed to take into consideration that the cause of action had not

arisen to initiate action under Section 138 of NI Act on the date

of cheque, but it would arise after lapse of the period fixed for

payment of the cheque amount after service of notice.

Moreover, Section 138 of NI Act would not authorise the

Appellate Court for granting interest at any rate on the fine

amount. Learned counsel for the accused placed reliance on the

decision of the Hon'ble Apex Court in Dilip Hariramani Vs

Bank of Baroda , in support of his contention.

15. Learned counsel further submitted that the

complainant could not have preferred an appeal before the First

Appellate Court seeking enhancement of the fine amount. The

First Appellate Court failed to consider any of these defence and

proceeded to pass the impugned judgment, without any basis.

Therefore, he prays for allowing the revision petitions and to set

aside the impugned judgment passed by the Trial Court and the

First Appellate Court and to acquit the accused, in the interest of

justice.

2022 Crl.L.J.2595

16. Per contra, learned counsel for the respondent

opposing the revisions submitted that the accused committed

the offence punishable under Section 138 of NI Act. The

complainant examined himself as PW1 and got marked the

relevant documents in support of his contention. The Trial Court

and the First Appellate Court on appreciation of the materials on

record, recorded concurrent findings that the complainant is

successful in proving the guilt of the accused beyond reasonable

doubt and convicted the accused. The scope of this revision is

very limited and unless it is shown that the impugned judgment

of conviction is either vitiated by perversity or there was

jurisdictional error, this Court may not interfere with the

impugned judgment of conviction. In support of his contention,

learned counsel for the respondent has placed reliance on Bir

Singh Vs Mukesh Kumar .

17. Learned counsel also submitted that when the

accused admits issuance of cheque, the presumption under

Section 139 of NI Act would arise and unless the accused rebuts

the said presumption, he is liable for conviction. In this regard,

he placed reliance on the decision of the Hon'ble Apex Court in

(2019) 4 SCC 197

APS Forex Services Pvt. Ltd., Vs Shakti International

Fashion Linkers and Others .

18. Learned counsel further submitted that as per the

admitted document - Ex.D2, the complainant had paid a sum of

Rs.25,00,000/- to the accused. The partnership firm even

though registered had not undertaken the business. Admittedly,

the accused has not complied with the undertaking given under

Ex.D2. Therefore, when the complainant demanded his amount

back, the accused had issued the cheque for Rs.15,00,000/-

towards part payment as per Ex.P1. Admittedly, the said cheque

was dishonored as account closed. Even according to the

accused, the account in question was closed during 2009-10.

But Ex.P1 was issued during 2012 i.e., on 14.06.2012. This

shows the conduct of the accused and it is a clear case of

cheating.

19. Learned counsel further submitted that the cheque -

Ex.P1 for Rs.15,00,000/- is dated 14.06.2012. The impugned

judgment of conviction and order of sentence of the Trial Court

was passed on 25.04.2017, in spite of that, the Trial Court

AIR 2020 SC 945

awarded fine of Rs.15,02,000/-. Therefore, the complainant has

preferred Criminal Appeal No.1026 of 2017, which came to be

allowed by awarding fine of Rs.20,00,000/- with interest at 18%

p.a. Learned counsel would submit that Section 117 of NI Act

deals with the Rules as to compensation. The compensation

payable in case of dishonour of a cheque would result in

awarding compensation and as per sub clause (c), the

complainant is entitled for the amount of cheque along with

interest at 18% per annum from the date of payment till

realization together with expenses caused by dishonour of the

cheque. Accordingly, the First Appellate Court modified the

impugned order of sentence. There is nothing wrong in

awarding the fine amount with interest at 18% per annum.

Therefore, there are no reasons to interfere with the impugned

judgment of conviction and order of sentence. Hence, both the

revision petitions are liable to be dismissed.

20. In view of the rival contentions urged by learned

counsel for both the parties, the point that would arise for my

consideration is:

"Whether the impugned judgment of conviction and order of sentence passed by the

Trial Court, which was modified by the First Appellate Court suffers from infirmities and calls for interference by this Court?"

My answer to the above point is in the 'Partly in the

Affirmative for the following:

REASONS

21. It is the specific contention of the complainant that

he entered into an agreement with the accused and his father as

per Ex.D2 and paid Rs.25,00,000/- as his investment in the

partnership firm. Accordingly, the partnership firm came to be

registered, but the accused has not complied with the

undertakings in Ex.D2. Therefore, the complainant demanded

back the amount which he invested. When the accused has not

repaid the said amount of Rs.25,00,000/-, he filed a criminal

complaint alleging cheating and concoction of documents.

During the pendancy of investigation in the said matter, the

accused is said to have issued Ex.P1 dated 14.06.2012 for

Rs.15,00,000/-. When the same was presented for encashment,

it was dishonoured as account closed. The legal notice was

issued to the accused calling upon him to repay the cheque

amount and the notice was served on the accused. The accused

issued reply as per Ex.P4 and refused to pay the cheque amount,

thereby he has committed the offence punishable under Section

138 of NI Act.

22. To prove his contention, the complainant examined

himself as PW1. He has filed his affidavit in examination-in-chief

by re-iterating his contention in the complaint. During cross

examination, witness stated that he along with the father of the

accused formed the partnership firm under the name of style of

M/s.Toon Zone. Witness admits that earlier the business was

belonging to the accused and the same was purchased by the

complainant and the father of the accused. He denied the

suggestion that he had paid only Rs.15,00,000/- to the accused.

But stated that he had paid Rs.25,00,000/-. He admits that his

son and daughter were working in the partnership firm. Witness

also admits that police has filed 'B' report in the complaint,

which he filed against the father of the accused. Witness denied

the suggestion that since there was arbitration clause in the

agreement, the complainant could not have filed the complaint.

Witness stated that he had challenged the 'B' report filed by the

Investigating Officer by filing protest petition. Witness admits

that there was a partnership firm entered into between him and

the father of the accused on 16.01.2009. He also admits that

there was an agreement between the parties on 20.01.2009 and

also states that on 01.01.2009, he had paid Rs.15,00,000/-

through cheque and Rs.10,00,000/- through cash to the

accused. Witness also stated that the accused has not given the

infrastructures or the licence as undertaken by him. He admits

that Ex.P1 - cheque was issued by the accused in his individual

name and also admits that when he filed the private complaint

against the accused, he was summoned to the Police Station.

The accused agreed that he had not provided the infrastructure

and also the licence as undertaken by him and had issued the

cheque as per Ex.P1. During cross examination, witness

specifically denied the suggestion that the accused had issued a

blank cheque with his signature as security on 04.01.2009.

23. Ex.P1 is the cheque dated 14.06.2012 drawn by the

accused in favour of the complainant for Rs.15,00,000/-. Ex.P2

is the bank endorsement returning the cheque unpaid as account

closed, Ex.P3 is the legal notice got issued by the complainant to

the accused informing him about dishonour of cheque and calling

upon him to repay the cheque amount, Exs.P3(a) and(b) are the

postal receipt and postal acknowledgment for having served the

notice on the accused.

24. Ex.P4 is the reply notice by the accused denying the

contention taken by the complainant in the legal notice and

denying issuance of the cheque in question. It is stated that the

complainant has misused the company security cheque, which

was issued by the accused while he was working under the

complainant for maintaining the Company - M/s.Toon Zone.

Ex.P6 is the passbook pertaining to the complainant, according

to which, a sum of Rs.15,00,000/- was transferred on

06.01.2009 in favour of M/s.Toon. Ex.P7 is the copy of FIR in

Crime No. 42 of 2012 of Jayanagar Police Station dated

02.02.2012 filed by the complainant against the father of the

accused alleging commission of offence punishable under

Sections 417, 418 and 420 of IPC. Ex.P8 is the private

complaint in PCR No.1662 of 2012 on the file of the learned II

Additional Metropolitan Magistrate, Bengaluru, filed by the

complainant against the father of the accused alleging similar

offence.

25. The accused has examined himself as DW1 and

stated in his chief examination that he was running an Animation

Training Institute in Jayanagar by name M/s.True Zone. The

complainant had approached him to invest in his business for

running another animation school in the joint name of his

brother Suresh and Ravikumar, the son of the complainant.

During December 2008, the complainant and his son approached

the father of the accused to purchase the business M/s.True

Zone run by the accused. After discussions, the sale price was

fixed at Rs.50,00,000/- and sale agreement was entered into.

In addition, he had demanded for Rs.10,00,000/- towards

goodwill. A partnership firm consisting of the complainant and

the father of the accused as partners came to be registered. It

was agreed between the parties that both the partners should

invest Rs.50,00,000/- together. The complainant issued the

cheque for Rs.15,00,000/- drawn in the name of the partnership

firm. In the meantime, the complainant requested the accused

to give a cheque as security for completion of the sale process.

Accordingly, the accused issued the cheque pertaining to his

personal account in favour of the complainant on 06.01.2009, as

security.

26. It is contended by the accused that he was

appointed as Center Executive as per the request of the partners

to work in the partnership firm for a period of one year.

Similarly, the daughter of the complainant was also appointed as

Front Office Executive on a salary of Rs.8,000/-. The accused

was not concerned about the financial matters. The complainant

had not paid the balance amount of Rs.10,00,000/-. Even

though, a criminal case was registered by the complainant

against the father of the accused, the police have filed 'B' report

after investigation. Similarly, the father of the accused had filed

complaint against the complainant.

27. During cross examination, witness admitted that

Ex.D2 is the agreement entered into between him, the

complainant and the father of the accused and as per clause (2)

the accused had undertaken to transfer the infrastructure facility

along with franchise licence, but denied the suggestion that he

had not complied with his undertaking. He admits his signature

found on Ex.D2, but denied that the complainant had paid

Rs.25,00,000/- under the said agreement. Witness denied the

suggestion that he had issued the cheque as per Ex.P1 towards

repayment of Rs.15,00,000/-, out of Rs.25,00,000/- paid under

Ex.D2.

28. The accused examined his father Eshwarappa as

DW2. He has re-iterated the contention taken by the accused as

stated above. During cross examination, he denied the

suggestion that the accused has received Rs.25,00,000/- from

the complainant as stated in Ex.D2. He admits that the first page

of Ex.D15 does not contain the signatures of any of the parties.

He also admits that no witnesses have signed Ex.D15 and that

the date of execution of Ex.D15 as mentioned in the first page is

different from the date mentioned on the last page. He denied

the suggestion that the complainant has never executed Ex.D15.

Witness admitted that he has not produced the deed of

partnership referred to in Ex.D15. However, denied the

suggestion that there was no such partnership which was in

existence. Witness stated that they had problem to mention the

fact in Ex.D2 that the complainant had paid only Rs.15,00,000/-

but not Rs.25,00,000/-. He denied the suggestion that Ex.P1 -

cheque was issued by the accused towards repayment of portion

of amount that was paid by the complainant under Ex.D2.

29. Ex.D2 is an admitted document relied on by both the

complainant and the accused. It is dated 20.01.2009 entered

into between the accused as seller and the partnership firm M/s.

Toon Zone represented by its partners Manjappa and

Eshwarappa i.e., complainant and the father of the accused as

purchasers. It is stated that the accused agreed to sell his

business in favour of the partnership firm for a total

consideration of Rs.50,00,000/-, out of which, Manjappa paid an

amount of Rs.25,00,000/- and Eshwarappa, the father of

accused paid Rs.25,00,000/-. The accused has acknowledged

the receipt of said amount from the partners. The accused had

agreed to work as Center Executive of the Training Institute. As

the parties mutually agreed, the accused and other parties have

signed Ex.D2.

30. The recitals in Ex.D2 which is an admitted document

fully supports the contention of the complainant that he had paid

Rs.25,00,000/- to the accused as his share in the partnership

business. Ex.D1 is Form-C i.e. acknowledgement of registration

of firm issued by the Registrar of firm on 02.02.2009.

Annexure-A attached to this document gives details of

investment of infrastructure of M/s.Toon Zone and the total

value of various fixtures as Rs.41,00,755/-.

31. It is the contention of the complainant that the

accused who sold his business establishment in favour of the

complainant and the father of the accused had undertaken to

transfer these infrastructures, but had not transferred the same.

Such contention gets support from the documents that are relied

on by the accused. Otherwise, there was no reason as to why

this Annexure-A was attached to Form- C produced by the

accused.

32. The accused has relied on Ex.D15 - the agreement

dated 01.04.2009. However, the second page of the agreement

shows dated 01.04.2010. This document was denied by the

complainant. It is not explained by the accused as to on which

date Ex.D15 came into existence. It is also not explained as to

why there was glaring inconsistencies between Exs.D2 and D15.

Ex.D2 is an admitted document, whereas, Ex.D15 is disputed

one.

33. When Ex.D2 - an admitted document produced by

the accused himself refers to payment of Rs.25,00,000/- by the

complainant to the accused, the accused cannot take an

inconsistent stand to contend that the complainant had paid only

Rs.15,00,000/- and not Rs.25,00,000/- as mentioned in Ex.D2.

The accused cannot lead oral evidence which is inconsistent with

the admitted document. Section 92 of the Indian Evidence Act,

excludes the evidence of oral agreement against the terms of the

contract, which was reduced into writing. There is absolutely no

explanation whatsoever by the learned counsel for the accused

about the contents of Ex.D2 and as why the accused has taken

inconsistent stand.

34. The accused specifically admitted that Ex.P1 -

cheque pertains to his individual bank account and it bears his

signature, but however, he contends that he had issued the

blank cheque with his signature to the complainant as security

on 06.01.2009. There is no reason as to why the accused has

not ventured to demand back the said blank cheque, if at all

given by him to the complainant. Moreover, there was no

occasion for the accused to issue blank cheque as security.

Learned counsel for the accused was not in a position to explain

the circumstances which demand issuance of blank cheque as

security. Admittedly, there was no obligation on the accused to

perform under any agreement to compel him to issue the blank

cheque as security.

35. When the accused admits that Ex.P1 - cheque

belongs to his personal account and it bears his signature and

the complainant placed reliance on Ex.D2 produced by the

accused in support of his contention that he had paid

Rs.25,00,000/- to the accused and towards repayment of the

portion of the said amount, cheque - Ex.P1 was issued, the

complainant is successful in discharging his primary burden of

proving issuance of the cheque towards discharge of legally

recoverable debt. The presumption under Sections 118 and 139

of NI Act operate in favour of the complainant and against the

accused and the burden shifts on the accused to rebut both the

legal presumptions. Even though the accused has cross

examined PW1 at length, produced several documents and

examined himself and his father as DWs.1 and 2, he could not

rebut the presumption as there was no reasonable explanation

to accept his defence that he had issued the blank cheque in

favour of the complainant as security. Hence, it is to be held

that the complainant is successful in proving the guilt of the

accused beyond reasonable doubt and he is liable for conviction.

36. Learned counsel for the respondent has placed

reliance on the decision in Bir Singh (supra). The Hon'ble Apex

court while dealing with similar contention that the blank cheque

was issued by the accused as security held in paragraphs 36 and

38 as under:

"36. Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under Section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt.

38. In the absence of any finding that the cheque in question was not signed by the respondent-accused or not voluntarily made over to the payee and in the absence of any evidence with regard to the circumstances in which a blank signed cheque had been given to the appellant complainant, it may reasonably be presumed that the cheque was filled in by the appellant complainant being the payee in the presence of the respondent-accused being the drawer, at his request and/or with his acquiescence. The subsequent filling in of an unfilled signed cheque is not an alteration. There was no change in the amount of the cheque, its date or the name of the payee. The High Court ought not to have acquitted the respondent-accused of the charge under Section 138 of the Negotiable Instruments Act.

37. The Hon'ble Apex Court in M/s Kalamani Tex and

another Vs P Balasubramanian referred to the decision in

Bir Singh (supra) and held in paragraph 17 as under:

"17. Even if we take the arguments raised by the appellants at face value that only a blank cheque and signed blank stamp papers were given to the respondent, yet the statutory presumption cannot be obliterated. It is useful to cite Bir Singh v. Mukesh Kumar, where this court held that:

"36. Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under Section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt.""

(Emphasis supplied)

38. Learned counsel for the accused placed reliance on

the decision of Dilip Hariramani (supra), in support of his

contention that only on failure to pay the cheque amount within

(2021) 5 SCC 283

15 days from the date of receipt of legal notice, cause of action

would arise.

39. There is absolutely no dispute with regard to this

position of law. But the fact remains that even though the

cheque is dated 14.06.2012, the impugned judgment by the

Trial Court came to be passed only on 25.04.2017. The First

Appellate Court disposed of both the appeals vide its judgment

dated 30.08.2019. The revision petitions are pending till date.

The conduct of the accused in producing Ex.D2 - an admitted

document and thereafter taking an inconsistent and contrary

stand that the complainant had not paid Rs.25,00,000/- as

acknowledged by him in Ex.D2 and protracting the matter till

this day even after lapse of more than 11 years, entitles the

complainant to get the reasonable compensation.

40. Section 138 of NI Act permits imposition of

imprisonment which may extend to two years or with fine which

may extend to twice the amount of cheque or with both.

However, the First Appellate Court imposed the fine i.e., twice

the amount of cheque and also imposed interest at 18% per

annum from the date of receipt of the cheque till realization.

Therefore, I am of the opinion that the impugned order of

sentence passed by the First Appellate Court modifying the order

of sentence passed by the Trial Court requires to be set aside,

as the order of sentence passed by the Trial Court imposing fine

of only Rs.15,02,000/- with default sentence is disproportionate

to the offence in question. The reasons assigned by the Trial

Court for taking such lenient view cannot be accepted.

Therefore, I am of the opinion that the ends of justice would be

met by imposing the fine of Rs.30,00,000/- with default

sentence. Under such circumstances, I am of the opinion that

the accused is not liable for substantive sentence to undergo

imprisonment. Accordingly, I answer the above point in partly in

the affirmative and proceed to pass the following:

ORDER

(i) Criminal Revision Petition No.1305 of 2019 is

dismissed.

(ii) Criminal Revision Petition No.113 of 2020 is allowed

in part.

(iii) The judgment of conviction dated 25.04.2017 passed

in CC No.25789 of 2012 on the file of the learned XXV Additional

Chief Metropolitan Magistrate, Bengaluru, which was confirmed

vide judgment dated 30.08.2019 passed in Criminal Appeal

No.1026 of 2017 by the learned LII Additional City Civil and

Sessions Judge, at Bengaluru City (CCH-53), are hereby

confirmed.

(iv) However, the order of sentence passed by both the

Courts are modified and the accused is sentenced to pay fine of

Rs.30,00,000/- and in default to pay fine, to undergo simple

imprisonment for a period of one year.

(iv) The amount in deposit, if any, be transmitted to the

Trial Court to appropriate the same towards fine and

compensation.

Registry is directed to send back the Trial Court records

along with copy of this order.

Sd/-

JUDGE

*bgn/-