Karnataka High Court
M/S Shreemaya Builders & Developers vs Smt Mamatha M H on 3 September, 2024
Author: Hemant Chandangoudar
Bench: Hemant Chandangoudar
-1-
NC: 2024:KHC:35908
CRL.RP No. 771 of 2016
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 3RD DAY OF SEPTEMBER, 2024
BEFORE
THE HON'BLE MR JUSTICE HEMANT CHANDANGOUDAR
CRIMINAL REVISION PETITION NO. 771 OF 2016
BETWEEN:
M/S. SHREEMAYA BUILDERS & DEVELOPERS
NO.3, OPP. TO BBMP, MALLASANDRA
HESARAGHATTA ROAD
T DASARAHALLI POST
BANGALORE-560 057
REP. BY ITS PARTNER
MR. T.P. GANGADHAR.
...PETITIONER
(BY SRI. M.R. RAJAGOPAL, SENIOR COUNSEL FOR
SRI H.N. BASAVARAJU, ADVOCATE)
AND:
SMT. MAMATHA M H
NO.1433, KRISHNADEVARAYA ROAD
VIJAYANAGARA
BANGALORE-560 040.
Digitally signed by B
K ...RESPONDENT
MAHENDRAKUMAR (BY SMT. M.D. ANURADHA URS, ADVOCATE)
Location: HIGH
COURT OF
KARNATAKA
THIS CRL.RP IS FILED U/S. 397(1) R/W 401 CR.P.C
PRAYING TO SET ASIDE THE JUDGMENT AND ORDER DATED
27.11.2014 PASSED BY THE XV A.C.M.M., BANGALORE IN
C.C.NO.30756/2011 WHICH IS CONFIRMED BY THE
JUDGMENT DATED 7.5.2016 PASSED BY THE LXVIII ADDL.
CITY CIVIL AND SESSIONS JUDGE, BANGALORE IN
CRL.A.NO.1427/2014 AND ACQUIT THE PETITIONER FOR THE
OFFENCE P/U/S 138 OF N.I.ACT.
THIS PETITION, COMING ON FOR FURTHER HEARING,
THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
-2-
NC: 2024:KHC:35908
CRL.RP No. 771 of 2016
CORAM: HON'BLE MR JUSTICE HEMANT CHANDANGOUDAR
ORAL ORDER
This revision petition under Section 397(1) read with Section
401 of the Cr.P.C. is filed challenging the judgment of the learned
Sessions Court, which upheld the judgment of the learned
Magistrate, convicting the petitioner for the offence punishable
under Section 138 of the Negotiable Instruments Act, 1881
(N.I. Act).
2. The respondent filed a complaint under Section 200 of
the Cr.P.C. alleging that the petitioner had committed an offence
punishable under Section 138 of the N.I. Act. The complaint arose
out of an agreement of sale entered into between the petitioner and
the respondent on 28.5.2010, in respect of four agricultural lands
located in Ajjana Halli village, Tharavekere Hobli, Bengaluru. The
total sale consideration was Rs.2,21,81,500/-. The petitioner issued
two cheques, one dated 28.9.2010 for Rs.40,00,000/- and the other
dated 28.11.2010 for Rs.54,12,500/-, both drawn on Shamrao
Vithal Co-operative Bank Ltd., towards part payment of the sale
consideration. When the cheques were presented for realization,
they were dishonored by Axis Bank Ltd. due to insufficient funds.
Subsequently, the respondent issued a statutory notice under
Section 138 of the N.I. Act on 27.4.2011, which the petitioner
replied to on 10.5.2011, denying liability for the cheque amounts.
3. During the trial, the respondent (complainant) was
examined as PW1 and submitted documents marked as Exs.P1 to
P8 to substantiate the case. The petitioner (accused) was
NC: 2024:KHC:35908
examined as DW1, and one Bhagyamma was examined as CW2 in
defense. Documents were marked as Exs.D1 to D15. After
evaluating the evidence, the learned Magistrate convicted the
petitioner for the offence under Section 138 of the N.I. Act, which
was subsequently confirmed by the learned Sessions Judge.
4. Sri M.R. Rajagopal, the learned Senior Counsel
representing the petitioner, submitted that both the Trial Court and
the Appellate Court erred in convicting the petitioner under Section
138 of the N.I. Act. He argued that the courts had themselves
found that the petitioner was liable to pay only Rs.75,12,500/-
instead of the cheque amounts totaling Rs.94,12,500/-. He further
contended that the provisions of Section 138 of the N.I. Act was not
attracted because part payments towards the debt had been made
by the petitioner after the cheques were drawn but before they
were presented for encashment, and the same was not endorsed
on cheques with acknowledgments of part payments, which should
have made the complaint non-maintainable. The findings of the
learned Sessions Judge and Magistrate, therefore, were
erroneous,, and should be set aside.
5. In support of these contentions, the petitioner relied on
the decision of the Hon'ble Supreme Court in Dashrathbhai
Trikambha i Patel vs. Hitesh Mahendrabhai Patel and Another,
(2023) 1 SCC 578, wherein it was held that part payments made
prior to the dishonor of cheques could impact the enforceability of
Section 138 of the N.I. Act.
NC: 2024:KHC:35908
6. In response, the learned counsel for the respondent-
complainant argued that the petitioner's acknowledgment of part
payments pertained to an earlier transaction and not to the
transaction for which the cheques in question were issued. She
contended that the accused could not challenge the findings of the
Trial Court regarding the amount due under the sale agreement, as
the petitioner had been convicted under Section 138 of the N.I. Act
and was ordered to pay a fine of Rs.1 crore.
7. The proviso to Section 372 of the Cr.P.C. allows a
victim to file an appeal only when the accused has been acquitted
or when inadequate compensation has been imposed. Hence, the
respondent-complainant's rights in the matter were limited to such
provisions.
8. After carefully considering the arguments presented by
counsel for both parties and upon examining the trial court records,
the central issue for deliberation is whether the complainant had
received part payment of the debt and whether an endorsement
was required on the cheque under Section 56 of the N.I. Act.
9. The sale agreement dated 28.5.2010 was executed
between the parties for the sale of four plots of land measuring 1
acre 30 guntas, with the total sale consideration amounting to
Rs.2,21,87,500/-. The following payments were made towards the
sale consideration:
i) Rs.1,75,000/- paid on 26.4.2009 under the registered
agreement of sale dated 5.12.2009.
NC: 2024:KHC:35908
ii) Rs.1,00,000/- paid on 5.12.2009 under the registered
agreement of sale dated 5.12.2009.
iii) Rs.5,00,000/- paid on 5.12.2009 under the registered
agreement of sale dated 5.12.2009.
iv) Rs.65,00,000/- paid in cash on 28.5.2010.
v) Rs.10,00,000/- paid via Demand Draft dated 28.5.2010.
vi) Rs.40,00,000/- paid via post-dated cheque dated
13.7.2010 drawn on Shamrao Vithal Co-operative
Bank Ltd.
vii) Rs.40,00,000/- paid via post-dated cheque dated
28.9.2010 drawn on Shamrao Vithal Co-operative
Bank Ltd.
viii) Rs.54,12,500/- paid via post-dated cheque dated
28.11.2010 drawn on Shamrao Vithal Co-operative
Bank Ltd.
10. Additionally, a sum of Rs.20,00,000/- was paid in cash,
and Rs.20,00,000/- was paid via cheque on 27.9.2010, as
evidenced by an acknowledgment dated 16.9.2010 endorsed on
the agreement of sale.
11. The petitioner also claimed to have made an additional
payment of Rs.25,51,250/- as per an endorsement dated
12.01.2010 on the sale agreement. However, this endorsement did
not bear the complainant's signature, and the alleged payment was
made before the execution of the agreement of sale, making it
inadmissible as part of the sale consideration.
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12. During cross-examination, the complainant admitted to
receiving a total sum of Rs.1,78,26,250/- at the time of the
institution of a suit for partition (O.S.No.181/2010). The Trial Court
and the Appellate Court both considered the endorsement dated
28.5.2010, which lacked the complainant's signature, and
concluded that two cheques for Rs.12,50,000/- each drawn on
Vijaya Bank in favor of the complainant constituted part payment
towards the sale consideration under the agreement dated
28.5.2010. Had these payments been made under the said
agreement, they should have been reflected in the agreement itself
rather than being endorsed separately on the same date.
13. The Trial Court, however, erroneously concluded that
the petitioner was liable to pay only Rs.74,12,500/- out of the total
sale consideration of Rs.2,21,87,500/-. It failed to account for the
fact that Rs.25,00,000/- was paid under different transactions
arising from earlier agreements. The complainant's admission that
she received Rs.1,78,26,250/- from the accused during the
institution of the partition suit included amounts paid under previous
transactions and did not relate to the current sale agreement.
14. In response to the statutory notice issued by the
complainant, the accused admitted his liability under the cheques
and expressed willingness to pay the balance sale consideration
for the registration of the sale deed, provided the complainant
furnished the necessary documents. The accused, however, did
not mention the alleged payment of Rs.25,00,000/- on 28.05.2010
via two cheques for Rs.12,50,000/- each. It was only during the trial
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that the accused raised the defense that part payment had been
made after entering into the sale transaction. Therefore, the
contention of the learned Senior Counsel that Section 138 of the
N.I. Act is not attracted due to the complainant's failure to endorse
the part payment received on the cheques prior to their
presentation is not tenable.
15. The dishonored cheques in question were for a total
amount of Rs.94,12,500/-. The Trial Court and the Appellate Court
awarded a compensation amount of Rs.99,00,000/-, which exceeds
the cheque amount. Consequently, the complainant cannot
maintain an appeal under the proviso to Section 372 of the Cr.P.C.,
as it permits an appeal by the victim only in cases where the
compensation awarded is inadequate. Therefore, the complainant
was not required to challenge the judgment of the trial court holding
that part payment was received before presentation of the
cheques, and the said finding is contrary to evidence on record.
16. In view of the above, there is no illegality in the
impugned judgment of conviction and the order of sentence.
17. Accordingly, the revision petition is dismissed.
18. The interim order granted shall continue for a period of
four weeks.
Sd/-
(HEMANT CHANDANGOUDAR)
JUDGE
HR
