Karnataka High Court

Sharanagouda S/O Ramareddy vs Channaveer S/O Annarao Biradar on 20 February, 2024

Author: Rajendra Badamikar

Bench: Rajendra Badamikar

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                                                   NC: 2024:KHC-K:1665
                                                   CRL.A No. 200108 of 2017




                             IN THE HIGH COURT OF KARNATAKA,

                                     KALABURAGI BENCH

                       DATED THIS THE 20TH DAY OF FEBRUARY, 2024

                                           BEFORE
                     THE HON'BLE MR. JUSTICE RAJENDRA BADAMIKAR


                          CRIMINAL APPEAL NO.200108 OF 2017 (378)
                   BETWEEN:

                   SHARANAGOUDA S/O RAMAREDDY
                   AGE: 44 YEARS, OCC: COMMISSION AGENT,
                   PARTNER IN KORI SIDDABASAVA TRADING COMPANY,
                   R/O NALAWAR, TQ. CHITTAPUR,
                   DIST. KALABURAGI-585102.
                                                              ...APPELLANT
                   (BY SRI R. S. LAGALI, ADVOCATE)

                   AND:

                   CHANNAVEER S/O ANNARAO BIRADAR
                   AGE: MAJOR, OCC: M/S BIRADAR DAL INDUSTRY,
Digitally signed
by SHILPA R        PLOT NO.18, IIND STAGE, INDUSTRIAL AREA,
TENIHALLI          HUMANABAD ROAD, KALABURAGI-585103.
Location: HIGH                                                  ...RESPONDENT
COURT OF
KARNATAKA
                   (BY SRI AVINASH A. UPLAONKAR, ADVOCATE)

                        THIS CRL.A. IS FILED U/S. 378(4) OF CR.P.C PRAYING TO
                   ADMIT THIS APPEAL, CALL FOR THE RECORDS FROM THE COURT
                   BELOW, ALLOW THIS APPEAL AND THEREBY SET ASIDE THE
                   JUDGMENT & ORDER OF ACQUITTAL DATED:07.07.2017 PASSED
                   BY THE V ADDITIONAL JMFC, KALABURAGI IN CRIMINAL CASE
                   NO.3084/2014 & CONVICT THE RESPONDENT/ACCUSED AND
                   AWARD DOUBLE THE CHEQUE AMOUNT TO APPELLANT BY WAY
                   OF COMPENSATION.
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                                       NC: 2024:KHC-K:1665
                                       CRL.A No. 200108 of 2017




     THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY,
THE COURT DELIVERED THE FOLLOWING:

                            JUDGMENT

This appeal is filed by the complainant challenging the

judgment of acquittal passed by V Addl. JMFC, Kalaburagi in

C.C.No.3084/2014 dated 07.07.2017, whereby, the learned

Magistrate as acquitted the accused for the offence

punishable under Section 138 of Negotiable Instruments Act

(in short NI Act).

2. For the shake of convenience the parties herein

are referred to according to their ranks in the Trial Court.

3. The factual matrix leading to the case are as

under:

The complainant is a commission agent and general

merchant as well as shareholder in Sri.Korisiddeshwar

Trading Company at Nalawar and the accused is running Dall

Industry in the name and style Biradar Dall Industries at

Humanabad road, Kalaburagi. The complainant had supplied

the Toor to the firm for which the accused made payments.

On 31.01.2014 the accused approached the complainant and

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requested to supply the Toor worth Rs.23,00,000/- on credit

basis and the complainant promised to deliver the same

within one month in 5 installments. The first installment was

delivered on 04.02.2014, second installment was delivered

on 08.02.2014, third was on 14.02.2014, fourth was on

19.02.2014 and final installment was delivered on

23.02.2014. It is alleged that the complainant has supplied

the Toor worth of Rs.22,06,901 to the complainant and the

accused promised to make the payment within one month.

Then the complainant approached the accused and the

accused has issued five cheques dated 01.05.2014 as per

Ex.P-1 to 5 and as per the request of the accused the said

cheques were presented on 08.06.2014 and the said cheques

were dishonored for insufficient funds. There after a legal

notice came to be issued to the accused and the accused did

not respond to the said notice. Hence, the complaint was

lodged against the accused under Section 138 of NI Act.

4. The learned Magistrate has taken cognizance of the

offence and issued process against the accused. The

accused appeared through his counsel and was enlarged on

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bail. He denied the plea recorded under Section 138 of NI

Act.

5. The complainant got himself cross examined as PW-1

and 2 witnesses were examined on behalf of the complainant

as PW-2 and 3. The complainant has also placed reliance on

34 documents marked as Ex.P1 to 34.

6. Thereafter, the statement of the accused under

Section 313 of Cr.P.C was recorded to enable him to explain

the incriminating evidence appearing against him in the case

of the complainant. The case of the accused is of total

denial. After hearing the arguments and after appreciating

the oral and documentary evidence, learned Magistrate has

acquitted the accused for the offences punishable under

Section 138 of NI Act.

7. Being aggrieved by the judgment of acquittal the

complainant is before this Court by way of this appeal.

8. Heard the arguments advanced by the learned

counsel for appellant/complainant and also the learned

counsel for respondent. Perused the records.

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9. The learned counsel for the appellant would contend

that the cheque belongs to the accused and it bears his

signature, are admitted facts. Hence, he would contend that

the presumption under Section 139 of NI Act ought to have

been drawn in favour of the complainant. He would also

contend that in reply notice there is admission of transaction,

but the Trial Court has committed an error in acquitting the

accused. Hence, he would seek for allowing the appeal by

convicting the accused/respondent herein.

10. Per contra, learned counsel for the respondent

would contend that the complainant is not the payee of the

cheque and he has no authorization to lodge the complaint.

He would also assert that there is no material evidence

regarding the supply of the goods and he would further

assert that the cheque at Ex.P-1 to 5 were issued on behalf

of a firm and in the name of another firm, but the complaint

was filed against the accused in personal capacity without

impleading the firm as a necessary party, nor the complaint

was filed on behalf of the firm. Hence, he would contend

that the complaint itself is not maintainable as it is hit by

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Section 141 of NI Act and sought for dismissal of the

complaint.

11. Having heard the arguments and perusing the

records, now the following point would arise for my

consideration:

"Whether the judgment of acquittal passed by the learned Sessions Judge is perverse, arbitrary and erroneous so as to call for any interference by this Court?"

12. The allegation of the complainant discloses that the

complainant has supplied Toor dall worth Rs.22,06,901/- to

the accused in 5 installments. The complaint allegation itself

discloses that the complainant is a shareholder in

Sri.Korisiddeshwar Trading Company at Nalawar and the

accused is running Dall Industry by name of Biradar Dall

Industries, Humanabad Road, Kalaburagi. The allegations

discloses that the Toor dall was delivered on behalf of

Sri.Korisiddeshwar Trading Company to Biradar Dall

Industries, Humanabad Road, Kalaburagi. In the evidence

the complainant/PW-1 asserts that he is a shareholder of the

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Sri.Korisidda Basava Trading Company, but all along in the

complaint it is alleged that it is Sri.Korisiddeshwar Trading

Company. The complainant admits that he has nothing to do

with Sri.Korisiddeshwar Trading Company in his cross

examination. Ex.P-16 is the legal notice and there also

reference of the complainant being a shareholder of

Sri.Korisiddeshwar Trading Company at Nalawar was made.

But all along in the evidence he asserts that he is concerned

with Sri.Korisidda Basava Trading Company. In this regard

he has placed reliance on the partnership deed at Ex.P-32

and authorization letter at P-34. But the complaint

allegations were not amended and notice was issued as

shareholder of Sri.Korisiddeshwar Trading Company.

13. On perusal of Ex.P-1 to 5 it is evident that the

cheques under Ex.P-1 to 5 were issued in favour of

Sri.Korisidda Basava Trading Company and they were issued

on behalf of Biradar Dall Industries. But, interestingly the

complaint was lodged in individual capacity, though there is

an allegation regarding he being a shareholder. But, Biradar

Dall Industries was neither prosecuted as accused nor

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Sri.Korisidda Basava Trading Company is arrayed as

complainant, represented by one of the partner. These are

the material lacunas and in this regard the decision rendered

by the Full Bench of the Hon'ble Apex Court reported in

(2012) 3 SCC (Cri) 241 (Aneeta Hada v/s Godfather

Travels And Tours Private Limited) is very much

relevant.

14. The Hon'ble Apex Court in the said decision has

considered the relevancy of the Section 141 of the NI Act and

implicating the officers of the company and impleading the

company as an accused as per mandate of law. In para 59

of the said judgment, the Hon'ble Apex Court has observed

as under:

"In view of our aforesaid analysis, we arrive at the irresistible conclusion that for maintaining the prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative. The other categories of offenders can only be brought in the drag-net on the touchstone of vicarious liability as the same has been stipulated in the provision itself. We say so on the basis of the ratio laid down in C.V.Parekh which is a three-Judge Bench decision. Thus, the view expressed in Sheoraton Agarwal does not correctly lay down the law and, accordingly, is hereby overruled. The decision in Anil Hada is overruled with the qualifier as stated in para 51. The

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decision in Modi Distillery has to be treated to be restricted to its own facts as has been explained by us hereinabove."

15. Hence, the mandate of the Full Bench of the Hon'ble

Apex Court states that arraying the company as the accused

is imperative and in the instant case, cheque is admittedly

issued by Biradar Dall Industries, which is not made as an

accused. Apart from that the complaint was lodged by the

complainant in his personal capacity and notice was issued in

his individual capacity, but the cheque was issued in favour

of Sri.Korisidda Basava Trading Company, who is not the

complainant herein. The complainant is a shareholder of

Sri.Korisidda Basava Trading Company, but not of

Sri.Korisiddeshwar Trading Company and though in the

evidence he tried to rectify it, the amendment was not made