Karnataka High Court
N. Sonnegowda vs H.M. Nagaraju on 4 March, 2024
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CRL.A No. 1246 of 2019
C/W CRL.RP No. 703 of 2019
NC: 2024:KHC:8993
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 4TH DAY OF MARCH, 2024
BEFORE
THE HON'BLE MS JUSTICE J.M.KHAZI
CRIMINAL APPEAL NO.1246 OF 2019
C/W
CRIMINAL REVISION PETITION NO.703 OF 2019
IN CRL.A NO.1246 OF 2019
BETWEEN:
H.M.NAGARAJU
S/O M.MUNIYAPPA,
AGED ABOUT 58 YEARS,
R/AT NO.264, 1ST C BLOCK,
WEST OF CHORD ROAD,
MAHALAKSHMIPURAM,
BENGALURU - 560 086.
...APPELLANT
(BY SRI. MANJUNATH B R, ADVOCATE)
AND:
Digitally signed
by REKHA R
N.SONNE GOWDA
Location: High
Court of S/O NARAYANAPPA,
Karnataka AGED ABOUT 51 YEARS,
R/OF MUTTUGADA VILLAGE,
KESHWARA POST,
SHIDLAGHATTA TALUK,
CHICKBALLAPUR DISTRICT - 562 105.
...RESPONDENT
(BY SRI. A.V.RAMAKRISHNA, ADVOCATE)
THIS CRL.A IS FILED UNDER SECTION 378(4) OF CR.P.C
PRAYING TO a) SET ASIDE THE JUDGMENT AND ORDERS
PASSED BY THE ADDITIONAL CITY CIVIL AND SESSIONS
JUDGE (CCH-56) AT BENGALURU IN CRL.A.NO.473/2016
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CRL.A No. 1246 of 2019
C/W CRL.RP No. 703 of 2019
NC: 2024:KHC:8993
DATED 24.04.2019 AND CONFIRM THE JUDGMENT DATED
06.04.2016 IN C.C.NO.21272/2013 ON THE FILE OF THE XX
ADDITIONAL CHIEF METROPOLITAN MAGISTRATE AT
BENGALURU FOR THE OFFENCE PUNISHABLE UNDER SECTION
138 OF NI ACT; b) PASS SUCH OTHER ORDER/S DEEMS FIT IN
THE FACTS AND CIRCUMSTANCES OF THE CASE, IN THE
INTEREST OF JUSTICE.
IN CRL.RP NO.703 OF 2019
BETWEEN:
N.SONNE GOWDA
S/O NARAYANAPPA,
AGED ABOUT 51 YEARS,
RESIDING AT MUTTUGADA VILLAGE,
KESHWARA POST,
SIDDALAGHATTA TALUK,
CHIKKABALLAPUR DISTRICT - 562 101.
...PETITIONER
(BY SRI. A.V.RAMAKRISHNA, ADVOCATE)
AND:
H.M.NAGARAJU
S/O M.MUNIYAPPA,
AGED ABOUT 50 YEARS,
RESIDING AT NO.264, 1ST C BLOCK,
WEST OF CHORD ROAD,
MAHALAKSHMIPURAM,
BENGALURU - 560 086.
...RESPONDENT
(BY SRI. MANJUNATH B R, ADVOCATE)
THIS CRL.RP IS FILED UNDER SECTION 397 R/W
SECTION 401 OF THE CODE OF CRIMINAL PROCEDURE
PRAYING TO a) SET ASIDE THE PORTION OF JUDGMENT AND
ORDER PASSED BY THE 55TH ADDITIONAL CITY CIVIL AND
SESSIONS JUDGE AT BENGALURU THEREBY DIRECTING THE
PETITIONER TO PAY A SUM OF Rs.30,000/- AS COMPENSATION
TO THE RESPONDENT IN CRL.A.NO.473/2016 DATED
24.04.2019 BY ALLOWING THIS CRIMINAL REVISION
PETITION; b) GRANT SUCH OTHER RELIEF AS THIS HON'BLE
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CRL.A No. 1246 of 2019
C/W CRL.RP No. 703 of 2019
NC: 2024:KHC:8993
COURT DEEMS FIT UNDER THE FACTS AND CIRCUMSTANCES
OF THE CASE, IN THE INTEREST OF JUSTICE.
THESE CRIMINAL APPEAL C/W CRIMINAL REVISION
PETITION, COMING ON FOR FURTHER HEARING, THIS DAY,
THE COURT DELIVERED THE FOLLOWING:
JUDGMENT
These two appeal and criminal revision petition are
arising out of judgment and order dated 24.04.2019, in
Crl.A.473/2016 on the file of 55th Addl.Civil and Sessions
Judge, Bengaluru, whereby it set aside the conviction and
sentence imposed by the trial Court for the offence
punishable under Section 138 of N.I. Act on the accused,
but directed the accused to pay compensation in a sum of
Rs.30,000/- to the complainant.
2. While complainant has filed the criminal appeal
challenging the acquittal of accused, accused has filed the
criminal revision petition challenging the order passed by
the Sessions Court, directing him to pay compensation in a
sum of Rs.30,000/- to the complainant.
3. For the sake of convenience, the parties are
referred to by their rank before the trial Court.
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4. Complainant filed a private complaint under
Section 200 Cr.P.C against the accused alleging offence
punishable under Section 138 of N.I Act, contending that
accused is known to him and on 05.01.2013, accused
borrowed hand loan of Rs.5,00,000/- to meet his financial
difficulties. He agreed to pay interest at the rate of 2%
p.m. In support of the said transaction, accused executed
an On Demand Promissory Note and Consideration Receipt
dated 05.01.2013 and also issued a post dated
04.03.2013 cheque for Rs.5,00,000/-. He assured to pay
the interest in cash as and when due. On 04.03.2013,
complainant presented the cheque for encashment
through his account in Pragati Gramina Bank, Hoskote.
However, it was returned dishonoured with endorsement
"No such account''. Complainant got issued a legal Notice
dated 20.04.2013. Though it is duly served on the
accused, he has neither paid the amount due nor sent any
reply and hence the complaint.
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5. After due service of summons, accused
appeared and contested the case by pleading not guilty.
6. To prove the allegations against accused,
complainant has examined himself as PW-1. He has
examined one witness as PW-2 and got marked
Ex.P1 to 44.
7. During the course of his statement under
Section 313 Cr.P.C, accused has denied the incriminating
evidence lead by the complainant.
8. He has also given evidence by examining
himself as DW-1, Manager of the drawer Bank as DW-2.
He has relied upon Ex.D1 to 9.
9. Vide judgment and order dated 06.04.2016, the
trial Court convicted the accused and sentenced him to
pay fine of Rs.6,10,000/- in default to undergo
imprisonment for three months.
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10. Aggrieved by the same, accused filed appeal
before the Sessions Court. Vide the impugned Judgment
and order dated 24.04.2019, the Sessions Court allowed
the appeal filed by the accused and set aside the order of
the conviction imposed by the trial Court. However, it
directed the accused to pay compensation in a sum of
Rs.30,000/- to the complainant.
11. Complainant has challenged the acquittal of
accused, contending that the impugned judgment and
order passed by the Sessions Court are not sustainable
either in law or on facts. Having regard to the fact that
accused admitted that the cheque belongs to him, drawn
on his account, maintained with his banker and it bears his
signature, the Sessions Court has failed to draw
presumption that the cheque in question was issued
towards repayment of legally recoverable debt and in
support of the same the accused has also executed On
Demand Promissory Note and Consideration Receipt at
Ex.P6 and 7. Despite receipt of legal notice, the accused
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has not sent any reply and the same is not taken into
consideration by the Sessions Court. The Sessions Court
has failed to take note of the fact that accused has failed
to prove his defence and thereby rebut the presumption.
On the other hand, the complainant has proved his case
beyond reasonable doubt. Viewed from any angle, the
impugned judgment and order are not tenable and pray to
all the allow the appeal, set aside the judgment and order
of the Sessions Court and restore the order of the trial
Court.
12. In support of his arguments, learned counsel for
complainant has relied upon the following decision:
(i) T.Vasanthkumar Vs. Vijayakumari
(T.Vasanthkumar)1
13. On the other hand, the accused has challenged
the order of the Sessions Court, directing him to pay
compensation in a sum of Rs.30,000/- to the complainant,
contending that when the Sessions Court has come to the
conclusion that the allegations against accused are not
2015 Crl.LJ 2853
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proved, it erred in directing accused to pay compensation.
It conflict with the finding given by it and that the trial
Court has erred in convicting the accused. There is no
justification for the said order and pray to set aside
portion of the judgment and order granting compensation
to the complainant.
14. In support of his arguments learned counsel for
accused has relied upon the following decisions:
(i) M/s Bridgestone India Pvt. Ltd Vs. Inderpal
Singh (M/s Bridgestone India Ltd.)2
(ii) Gopal Krishna Vs. Abdul Bakai
(Gopal Krishna)3
15. Heard elaborate arguments of both sides and
perused the record.
16. Thus, it is the definite case of complainant that
accused borrowed a sum of Rs.5,00,000/- from him and
issued the subject cheque and also executed an On
Demand Promissory Note and Consideration Receipt.
When the cheque was presented for realization, it was
2015 AIR SCW 6556
2019 (2) KLR 284
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dishonoured with endorsement "No such account". After
issue of legal notice and on the failure of accused to pay
the amount due, complaint is filed. Though accused admit
that cheque in question belongs to him, drawn on his
account maintained with his banker, he has disputed of
having borrowed hand loan of Rs.5,00,000/- from the
accused. On the other hand, he has claimed that during
1999, he had borrowed hand loan of Rs.25,000/- from
PW-2 Chikkahanumappa, who is a relative of complainant
and at that time he had issued the subject cheque,
Demand Promissory Note and Consideration Receipt in
blank form. Though he repaid the same, the blank cheque,
Demand Promissory Note and Consideration Receipt were
not returned by Chikkahanumappa. He has got filed the
present complaint through complainant who is his relative
to make wrongful gain. He has also contended that the
said account came to be closed as it was not in operation.
17. Having regard to the fact that the cheque in
question belongs to accused, drawn on his account
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maintained with his banker and it bears his signature,
presumption under Section 139 of the N.I Act is operating in
favour of the complainant, placing the initial burden on the
accused to prove that the cheque was not issued towards
repayment of any debt or liability and on the other hand to
establish the circumstances in which the cheque has reached
the hands of the complainant.
18. However, in John K.Abraham Vs. Simon C.
Abraham & Anr (John K.Abraham)4, the Hon'ble
Supreme Court held that in order to draw presumption
under Sections 118 and 139 of N.I Act, the burden lies on
the complainant to show that:
(i) She had the requisite funds for advancing the
sum of money/loan in question to accused.
(ii) The issuance of cheque by accused in support
of repayment of money advanced was true
and
(iii) The accused was bound to make payment as
had been agreed while issuing cheque in
favour of the complainant.
(2014) 2 SCC 236
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19. As held by the Hon'ble Supreme Court in Tedhi
Singh Vs Narayan Das Mahant (Tedhi Singh)5, where the
accused has failed to send reply to the legal notice,
challenging the financial capacity of the complainant, at the
first instance, complainant need not prove his financial
capacity. However, at the trial if the financial capacity of
complainant is challenged, then it is for the complainant to
prove the same.
20. In APS Forex vs Shakti International Fashion
Linkers Pvt. Ltd (APS Forex)6, the Hon'ble Supreme Court
held that when accused raises issue of financial capacity of
complainant, in support of his probable defence, despite
presumption operating in favour of complainant regarding
legally enforceable debt under Section 139 of N.I. Act, onus
shifts again on the complainant to prove his financial
capacity by leading evidence, more particularly when it is a
case of giving loan by cash and thereafter issue of cheque.
2022 SCC OnLine SC 302
(2020) 12 SCC 724
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21. In Vijay Vs. Laxman and Anr (Vijay)7,
K.Subramani Vs. K.Damadara Naidu (K.Surbamani)8 and
K.Prakashan Vs. P.K.Surenderan (K.Prakashan)9, also the
Hon'ble Supreme Court held that the presumption under
Section 139 of N.I. Act, is a rebuttable presumption and
when accused rebut the same by preponderance of
probabilities, it is for the complainant to prove his case
beyond reasonable doubt including the financial capacity.
22. Keeping in mind the ratio in the above decisions
of the Hon'ble Supreme Court and having regard to the
fact that accused has challenged the financial capacity of
complainant, at the outset it is necessary to examine
whether the complainant has proved his financial capacity
after which it would be necessary for the accused to prove
his defence.
23. With regard to his financial capacity, the
complainant has deposed that he is owning 4 acres of
(2013) 3 SCC 86
(2015) 1 SCC 99
(2008) 1 SCC 258
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agricultural land and growing vegetables such as Ridge
Gourd, Chillies, Ladies finger, flowers and also silk
cocoons. He has produced Ex.P9 to 44 with regard to sale
of vegetables as well as the silk cocoon. However, he has
not produced the documents to show that he is owning
agricultural land and carrying out agricultural activities,
including growing vegetables, flowers, poultry and also
raising silk cocoon.
24. During his cross-examination, complainant has
claimed that he is residing in Bengaluru. He has not made
it clear whether he carries out agricultural operations in
person or through servants. It is alleged by the accused
that he has concocted Ex.P9 to 44 for the purpose of this
case. In the light of the said suggestion, the production of
documents to his ownership over the agricultural land
would have supported his claim of having agricultural land
and sufficient income. It would have allowed the Court to
cross verify whether the agricultural products sold through
Ex.P9 to 44 were in fact grown in the said land and these
documents actually pertains to the complainant. He has
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also not produced any document to show that he is
running a Poultry farm and also growing flowers. For
reasons best known to him, the complainant has not
chosen to produce the said documents.
25. Though the complainant is operating an account
in Pragati Gramina Bank, through which he has presented
the subject cheque for realization and also claims that he
is having upto Rs.6 lakhs p.a. income from the agriculture,
he has not chosen to produce his account extract to prove
his income. Having operating an account and when is
expected to carry your transactions of more than
Rs.20,000/- through account, it would be reasonable to
expect that complainant credit his income to his account.
The claim of the complainant that he had kept cash of
Rs.5,00,000/- in his house and paid it to the accused,
especially when he is disputing the said transaction,
appears to be unnatural.
26. One more important aspect noteworthy is that
according to the accused, he had issued the subject
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cheque as well as the On Demand Promissory Note and
Consideration Receipt blank to PW-2 Chikkahanumappa
and the same has been utilized by complainant to file the
complaint against accused. It is also relevant note that
complainant is an Engineer by profession. According to the
complainant, the cheque was completely filled when
accused gave it to him and Ex.P6 and 7 were filled by one
Gopalaswamy. If at all accused has executed Ex.P6 and 7,
there was no impediment for the complainant to get it
written by the accused himself, which would have
supported complainant's case. When suggested that Ex.P1
cheque is not in the handwriting of accused, complainant
has replied that he might have got it written by someone
else. This supports the defence of accused that when he
signed Ex.P1, 5 and 6, they were blank.
27. These factors also create doubt as to the
veracity of complainant's case. PW-2 Chikkahanumappa is
no other than the brother-in-law of complainant, from
whom accused claim to have borrowed hand loan of
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Rs.25,000/- and issued Ex.P1, 5 and 6 when they were
blank except his signature. Though complainant claim that
when the loan transaction took place, apart from PW-2
Chikkahanumappa, one Srinivas was also present and
Ex.P5 and 6 are written by one Gopalaswamy, he has not
chosen to examine them. Their evidence would have
supported his case as they are not related to him,
especially when PW-2 Chikkahanumappa is related to
complainant and the accused is claiming that Ex.P1, 5 and
6 were given to PW-2 Chikkahanumappa.
28. During his cross-examination, the complainant
has admitted that thrice he has presented the cheque for
encashment. It is relevant to note that the subject cheque
is dishonoured on the ground that no such account was in
existence and it has come in the evidence of PW-2 that the
account of accused was closed during 1995. The
complainant is not having any explanation as to why he
presented the cheque thrice, when the subject cheque was
dishonoured on account of closure of account. He has
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stated that on first two occasion, the bank did not issue
any endorsement and therefore he had to present it again.
If the bank failed to issue endorsement, he could have
pursued the matter and got the endorsement.
29. The fact that subject cheque was printed prior to
2000 also supports the contention of accused that it was
issued during 1999. Though the complainant was not
having any control over the accused, issuing the cheque of
the year 1999, at least he ought to have persuaded and
insisted upon him to issue latest cheque. Though the
complainant has claimed that accused is known to him
since his childhood, he has stated that he do not know the
phone number of accused which appears to be unnatural
and it supports the contention of accused that complainant
is a total stranger to him.
30. On the other hand, the accused has lead
evidence to show that at the relevant point of time when
he has allegedly borrowed loan from the complainant, he
was engaged in his work. The evidence of PW-2 prove that
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the cheque leaf in question is printed prior to 2000. As
held by the Hon'ble Supreme Court in APS forex, unless
and until the complainant prove his financial capacity, the
burden would not shift on the accused.
31. The last leg of arguments of learned counsel for
accused is that the cheque in question is drawn on Canara
Bank, Sidlaghatta branch and it is presented by the
complainant through Pragati Gramina Bank, Hoskote and
therefore the Addl. chief Metropolitan Magistrate,
Bengaluru had no territorial jurisdiction to decide the
dispute and the complainant ought to have filed complaint
at Hoskote. In this regard he has relied upon the decision
of the Hon'ble Supreme Court in bridge M/s Bridgestone
India Ltd., wherein the Hon'ble Supreme Court has held
that in the light of amendment to Section 142 (2) (a) of
N.I Act, it is the Court within whose territorial jurisdiction
cheque is presented and dishonoured, which is having the
restriction to decide the dispute. As rightly submitted by
the learned counsel for accused when the complainant has
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failed to prove the allegations against accused on merit,
no purpose would be served by remanding the case to the
jurisdictional Court to decide the dispute once again.
32. Though the Sessions Court has rightly come to
the conclusion that allegations against accused are not
proved, it has erred in directing the accused to pay
compensation in a sum of Rs.30,000/- to complainant. To
that extent the revision petition filed by the accused
succeeds. However, the appeal filed by the complainant is
liable to be dismissed and accordingly the following:
ORDER
(i) Appeal filed by the complainant under
Section 378(4) of Cr.P.C. is
dismissed.
(ii) The Criminal Revision Petition filed by
the accused under Section397 r/w
Section 401 of Cr.P.C. is allowed.
(iii) The impugned judgment and order of
the Sessions Court in so far as
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directing accused to pay
compensation in a sum of Rs.30,000/-
is set aside. The remaining order is
confirmed.
(iv) The Registry is directed to send back
the trial Court as well as Sessions
Court records along with copy of this
judgment forthwith.
Sd/-
JUDGE
RR
