Karnataka High Court
Sri. Prashanth. A. H vs Sri. A. H. Indhudhara on 28 May, 2024
1 CRL.A NO.512 OF 2018
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 28TH DAY OF MAY, 2024
BEFORE
THE HON'BLE MS.JUSTICE J.M.KHAZI
CRIMINAL APPEAL NO.512 OF 2018
BETWEEN:
SRI. PRASHANTH A H
S/O LATE B HALAPPA,
HINDU, AGED ABOUT 46 YEARS,
R/AT NO.4, MAHAVISHNU NILAYAM,
C/O K.PADMANABHAN,
2ND CROSS, V.S.R.LAYOUT,
NEAR EVERGREEN MART,
BEHIND WHITEFIELD RAILWAY STATION,
KADUGODI, BENGALURU - 560 067.
......APPELLANT
(BY SRI. MURTHY K, ADVOCATE)
AND:
SRI. A H INDHUDHARA
S/O LATE B. HALAPPA,
HINDU, AGED ABOUT 54 YEARS,
R/AT RANGANATHA STREET,
ANANDAPURAM POST,
SAGAR TALUK,
SHIMOGA DISTRICT.
.......RESPONDENT
(BY SRI. HARISH KUMAR M S, ADVOCATE)
THIS CRIMINAL APPEAL IS FILED UNDER SECTION
378(4) OF CR.P.C PRAYING TO SET ASIDE THE JUDGMENT
DATED 04.01.2018 PASSED BY THE XIII ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE, BENGALURU IN
C.C.NO.8170/2016 AND CONVICT THE ACCUSED/
RESPONDENT FOR THE OFFENCE PUNISHABLE UNDER
2 CRL.A NO.512 OF 2018
SECTION 138 OF N.I ACT AND FURTHER PASS ANY OTHER
APPROPRIATE ORDERS AS DEEMS FIT UNDER THE FACTS
AND CIRCUMSTANCES OF THE CASE, BY ALLOWING THE
ABOVE APPEAL IN THE INTEREST OF JUSTICE AND EQUITY.
THIS APPEAL HAVING BEEN HEARD AND RESERVED ON
19.03.2024, COMING ON FOR PRONOUNCEMENT OF
JUDGMENT THIS DAY, THE COURT DELIVERED THE
FOLLOWING:
JUDGMENT
This appeal is by the complainant challenging the
acquittal of respondent/accused by the trial Court for the
offence punishable under Section 138 of Negotiable
Instruments Act, 1881 (for short 'N.I Act').
2. For the sake of convenience, parties are
referred to by their rank before the trial Court.
3. Complainant and accused are brothers. It is
the case of the complainant that accused is a driver by
profession. He is also doing real estate business. On
24.05.2015, accused has taken hand loan of Rs.10 lakhs
from the complainant in cash to clear the hand loans
raised by him from other banks for domestic purpose.
Accused promised to repay the same within a period of
six months and issued a post dated 26.11.2015 cheque
for Rs.10 lakhs, with an assurance that it would be
honoured on presentation. However, on 26.11.2015,
when he presented the cheque for realisation, it was
dishonoured on the ground 'Account closed'. When
complainant brought this fact to the notice of accused, he
did not choose to pay the amount. Hence, complainant
got issued legal notice dated 17.12.2015. It is served on
him on 18.12.2015. Instead of paying the amount due
under the cheque, accused has sent an evasive reply,
and hence the complaint.
4. At the trial Court, the accused appeared
through the counsel and contested the case by pleading
not guilty.
5. In order to prove the allegations against
accused, complainant has examined himself as PW-1 and
relied upon Ex.P1 to 18.
6. During the course of his statement under
Section 313 Cr.P.C accused has denied the incriminating
evidence led by the complainant.
7. Accused has led defence evidence by
examining himself as DW-1. He has relied upon Ex.D1
to 4.
8. Vide the impugned judgment and order the
trial Court has dismissed the complaint.
9. Aggrieved by the same, the complainant has
filed this appeal, contenting that the trial Court has erred
in acquitting the accused. The impugned judgment and
order are contrary to the evidence placed on record and
as such perverse. The trial Court has erred in disbelieving
the case of the complainant by ignoring the documents
placed on record. The trial Court has disbelieved the case
of the complainant, mainly on the ground that on
22.05.2015 and 24.05.2015, complainant and accused
attended marriage and reception, respectively at
Thirthahalli and therefore it was impossible for them to
enter into the transaction at Bengaluru on 24.05.2015.
The trial Court has also not appreciated the fact that the
accused has taken inconsistent defence and failed to
prove the same. The trial Court has also not appreciated
the fact that accused choose to file the suit against the
complainant after receiving the hand loan of Rs.10 lakhs
and before that the relationship was normal. Without
taking into consideration the documents produced by the
complainant regarding sale of gold ornaments to pay the
loan to the accused, the trial Court has committed grave
error in holding that complainant had no financial
capacity to lend Rs.10 lakhs to the accused. The findings
of the trial Court are perverse and calls for interference
by this Court and hence the appeal.
10. In support of his arguments learned counsel
for complainant has relied upon the decision in Rajesh
Jain Vs. Ajay Singh (Rajesh Jain)1.
(2023) 10 SCC 148: AIR 2023 SC 5018
11. On the other hand learned counsel
representing accused has supported the impugned
judgment and order and sought for disposal appeal also.
12. Heard elaborate arguments of both sides and
perused the record.
13. Thus, it is the definite case of the complainant
that he and accused are brothers and accused in order to
pay the hand loan raised by him and also with the other
banks borrowed hand loan of Rs.10 lakhs and issued the
subject cheque which came to be dishonoured on the
ground 'Account closed'. On service of legal notice,
instead of paying the amount due under the cheque, the
accused has sent an evasive reply taking defence.
14. On the other hand, the accused has come up
with a definite defence that the relationship between
complainant and the other siblings is not coral on
account of civil dispute regarding partition of joint family
property and such being the case, it cannot be believed
that complainant would lend Rs.10 lakhs to the accused
and he had no such necessity. The accused has alleged
that he had borrowed loan from a Co-operative Society,
of which complainant who is a practising advocate is
legal advisor and he had issued legal notice to the
accused on behalf of the said Co-operative Society and at
that time he has taken a blank cheque given to the
Society and utilising the same, complainant has filed a
false complaint making unrighteous claim. He has also
claimed that on 22.05.2015 and 24.05.2015, both
complainant and accused were engaged in the marriage
and reception function of their close relative and he
never went to Bengaluru on 24.05.2015 to receive Rs.10
lakhs and this itself falsify the claim of the complainant.
He never had the capacity to lend Rs.10 lakhs to the
accused and on this ground also, the claim of the
complainant is false and rightly the trial Court has
dismissed the complaint and pray to dismiss this appeal
also.
15. Having regard to the fact that the accused is
not disputing that the cheque in question belongs to him,
drawn on his account maintained with his banker and it
bears his signature, presumption under Section 139 of
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. In the reply notice itself
accused has challenged the financial capacity of
complainant to lend him hand loan of Rs.10 lakhs and
necessity for him to borrow such huge amount.
16. In John K.Abraham Vs. Simon C. Abraham &
Anr (John K.Abraham)2, 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
(2014) 2 SCC 236
(iii) The accused was bound to make payment
as had been agreed while issuing cheque in
favour of the complainant.
17. In Tedhi Singh Vs Narayan Das Mahant
(Tedhi Singh)3,the Hon'ble Supreme Court held that
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. In the present
case in the reply notice itself, the accused has challenged
the financial capacity of complainant and therefore, the
burden is on the complainant to prove the same and it is
necessary to examine whether the evidence lead by
complainant on the aspect is reliable and trustworthy.
18. In APS Forex vs Shakti International Fashion
Linkers Pvt. Ltd (APS Forex)4 also, the Hon'ble Supreme
Court held that when accused raises issue of financial
2022 SCC OnLine SC 302
(2020) 12 SCC 724
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.
19. In Vijay Vs. Laxman and Anr (Vijay)5,
K.Subramani Vs. K.Damadara Naidu (K.Subramani)6 and
K.Prakashan Vs. P.K.Surenderan (K.Prakashan)7, 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.
20. Keeping in mind the ratio in the above
decisions, it is necessary to examine whether the
complainant was having financial capacity to advance
(2013) 3 SCC 86
(2015) 1 SCC 99
(2008) 1 SCC 258
Rs.10 lakhs to the accused and having regard to the
strained relationship between them, whether it is
believable that he would lend Rs.10 lakhs against security
of a cheque, especially when the complainant is claiming
that accused had taken the loan to repay the several hand
loans incurred by him and also from the bank and
whether the accused was in a position to repay the
alleged loan taken from the complainant.
21. It is pertinent to note that neither in the
complaint nor in the legal notice, the complainant has
disclosed the fact that he had to sell gold ornaments in
order to pay hand loan of Rs.10 lakhs to the accused. It
is not his case that he had the money and paid the same
to the accused to bail him out of the situation. Heavy
burden is on the complainant to prove that the
relationship between him and accused was so cordial that
in order to help the accused, he went to the extent of
selling jewels belonging to his wife and pay a substantial
sum of Rs.10 lakhs against a cheque, more particularly
when the financial situation of accused was not very
sound, healthy and encouraging.
22. It is relevant to note that in the complaint,
more specifically in the cause title, the complainant has
not disclosed the fact that he is an Advocate by
profession. In the examination-in-chief also, the
complainant has not deposed that he had to sell gold
jewels to advance hand loan to the accused. At the first
instance when the documents were marked, the
complainant has not produced the receipt for having sold
gold ornaments .Only during his further examination-in-
chief, he has chosen to produce Ex.P9 to 17, which are
estimate and the tax invoices for purchase of gold jewels.
Ex.P17 is stated to be the document evidencing sale of
gold ornaments.
23. Despite the accused disputing these
documents, complainant has not chosen to examine
Rajesh Kumar, the Proprietor of S.R.S.Jewel craft, who is
the author of these documents. Absolutely, there was no
impediment to examine him to prove that in fact
complainant has sold gold jewels and a gold biscuit and
received Rs.11,22,923 from him on 20.5.2015. He would
have produced documents to show that he has taken the
purchase of these gold ornaments to his stock. For
reasons best known to him, the complainant has not
examined the said Rajesh Kumar. Certainly adverse
inference is required to be drawn.
24. In order to prove that his relationship with the
complainant was not cordial, during the cross-
examination, the accused has elicited through the
complainant that as per Ex.D1 dated 24.07.2002, in his
capacity as the advocate, the complainant has sent legal
notice to the accused on behalf of Shri Ram Investments
Ltd, Shivamogga. Accused has taken a specific defence
that while borrowing loan from Shri Ram Investments,
two blank cheques were taken from him and in his
capacity as the legal advisor of Shri Ram Investments
Ltd, complainant came in possession of the said cheques
and utilising one of them he has filed this complaint.
25. The complainant has denied that he was the
legal advisor of Shri Ram Investments Ltd and stated
only the task of issuing legal notice was entrusted to
him. In order to issue legal notice, it is necessary to
appraise the advocate about the facts and since the legal
notice was issued on behalf of an entity involved in
lending money, necessarily the advocate who is issuing
legal notice is required to be apprised of all the
documents.
26. Therefore, it cannot be accepted that the file
was not gone through by the complainant. Moreover,
when the person to whom the notice is sent is his own
brother, in normal circumstances, certainly the
complainant would have refused to take the said matter,
unless the relationship between him and the accused was
strained. If the relationship between him and accused
was normal, certainly the complainant ought not have
sent the legal notice to him. Ex.P18 is the complaint
dated 27.05.2016 given by the wife of accused against
the complainant herein, alleging that complainant is
troubling all the family members, including their
daughter and giving threat that utilising the other cheque
he is going to file one more complaint, etc.
27. Ex.D2 is the copy of complaint dated
27.5.2015 given by the complainant against accused and
other government officials alleging that illegally Khata
has been transferred in respect of his property. When
things stood thus, at any stretch of imagination, it cannot
be believed that accused would request for hand loan
and complainant to go to the extent of selling the jewels
and extending the hand loan to the accused.
28. During his cross-examination, complainant
has deposed in addition to issuing the cheque, the
accused had also given a receipt for having received
Rs.10 lakhs, but the same is misplaced. There is no
reference to the receipt in the legal notice and complaint.
Having regard to the fact that complainant is an advocate
and know the significance of the said document. When he
has safely kept the cheque at Ex.P1, if there was any
receipt, the same would have been properly safeguarded
him along with the cheque.
29. Having regard to the decisions in John
K.Abraham, Tedhi Singh and APS Forex and in the
light of the fact that the complainant has failed to prove
his financial capacity, the decision in Rajesh Jain relied
upon by the complainant is not applicable to the case on
hand.
30. Moreover, as per Ex.D3, 3(a) and D4, both
complainant and accused have attended marriage on
22.05.2015 at Madaburu, N.R Pura taluk and Reception
on 24.05.2015 at Jumbavalli of Thirthahalli. Such being
the case, it is doubtful whether on 24.05.2015, both of
them would go to Bengaluru for the purpose of paying
and receiving hand loan of Rs.10 lakhs. If at all as per
Ex.P17, complainant has sold the gold jewels on
20.05.2015, for the purpose of lending the same to the
accused, he would have well handed over the cash to the
accused when they have met at the marriage and
reception.
31. Further, except the signature of the accused
in Ex.P1 cheque through which the accused has proposed
to repay the hand loan of Rs.10 lakhs, rest of the
contents are typed, which is normally the procedure
adopted by the institutions to fill the cheque. It
probabalise the defence of the accused that the cheque
in question was given to Shri Ram Investments Ltd. If at
all this cheque was filled and handed over by the accused
to the complainant, in the normal course he would have
filled it in his own handwriting rather than taking the
trouble of getting it typed. This is also a circumstance
which creates doubt as to the veracity of the case of the
complainant.
32. Though complainant has pleaded that the
accused was in need of Rs.10 lakhs to repay the hand
loan and also loans taken from the Bank and for his
family necessity, the complainant has not led any
evidence to establish the said fact. At least he could have
produced some documents to show that accused was due
to the Bank and the portion of the money is utilised to
repay the same. He could have led some evidence to
show that there was pressure on the accused to repay
the hand loans and unable to bear the pressure, accused
told him that he would commit suicide if he is not able to
get the money.
33. Taking into consideration the oral and
documentary evidence placed on record, the trial Court
has come to a correct conclusion that allegations against
accused are not proved, including the financial capacity
of the complainant to lend a sum of Rs.10 lakhs to the
accused and acquitted him. On re-appreciation of the
oral and documentary evidence placed on record, this
Court finds no justifiable grounds to interfere with the
conclusions arrived at by the trial Court. In the result,
the appeal fails and accordingly the following:
ORDER
(i) Appeal filed by the complainant under
Section 378(4) of Cr.P.C is dismissed.
(ii) The impugned judgment and order dated
04.01.2018 in C.C.No.8170/2016 on the
file of XIII ACMM, Bengaluru is hereby
confirmed.
(iii) The Registry is directed to send back the
trial Court records along with copy of this
judgment forthwith.
Sd/-
JUDGE
RR
