Karnataka High Court

H V Jagannatha vs Prabhakar B J on 3 February, 2025

Author: Shivashankar Amarannavar

Bench: Shivashankar Amarannavar

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                                                        CRL.A No. 533 of 2015




                        IN THE HIGH COURT OF KARNATAKA AT BENGALURU

                             DATED THIS THE 3RD DAY OF FEBRUARY, 2025

                                             BEFORE
                      THE HON'BLE MR JUSTICE SHIVASHANKAR AMARANNAVAR
                                 CRIMINAL APPEAL No. 533 OF 2015
                      BETWEEN:

                         H V JAGANNATHA
                         AGED ABOUT 69 YEARS
                         S/O SRI.H.R.VAGEESHA
                         R/AT No.K-162, 19TH A MAIN
                         14TH CROSS, 1ST K BLOCK,
                         RAJAJINAGAR BANGALORE - 560 010.
Digitally signed by
LAKSHMINARAYANA                                                  ...APPELLANT
MURTHY RAJASHRI
Location: HIGH
COURT OF              (BY SRI GURURAJ KULKARNI, ADVOCATE)
KARNATAKA

                      AND:

                         PRABHAKAR B J
                         S/O B.K.JAYANNA
                         No.206, B.R.I.COLONY,
                         A.D.HALLI, BHASAVESHWARA NAGAR
                         BANGALORE - 560 079.
                                                             ...RESPONDENT

                      (BY SRI D P PRASANNA, ADVOCATE)

                            THIS CRL.A. IS FILED UNDER SECTION 378(4) Cr.P.C
                      PRAYING TO SET ASIDE THE IMPUGNED JUDGMENT DATED
                      19.3.2015 PASSED BY THE XXIII A.C.M.M., BANGALORE IN
                      C.C.No.29728/2010-ACQUITTING THE RESPONDENT/ACCUSED
                      FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF
                      N.I.ACT AND ETC.,
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                                                NC: 2025:KHC:4762
                                            CRL.A No. 533 of 2015




     THIS APPEAL COMING ON FOR DICTATING JUDGMENT
THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

CORAM:    HON'BLE MR JUSTICE SHIVASHANKAR AMARANNAVAR


                      ORAL JUDGMENT

This appeal is filed by the complainant challenging

the judgment of acquittal dated 19.03.2015 passed in

C.C.No.29728/2010 by the XXIII Additional CMM,

Bangalore, whereunder, the respondent/accused has been

acquitted for the offence punishable under Section 138 of

Negotiable Instruments Act, 1881 (for short 'the Act').

2. The case of the complainant is that he and accused

are friends and accused had borrowed a sum of

Rs.6,35,000/- from him, on different dates for the

purpose of purchasing vehicles and for family necessities

and whereas the respondent/accused for making payment

of the said amount borrowed, has issued three cheques

bearing No.618918 dated 26.11.2009 for Rs.15,000/-,

cheque bearing No.618919 dated 26.12.2009 for

Rs.15,000/- and cheque bearing No.618915 dated

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21.01.2010 for Rs.6,05,000/- in favour of the

complainant. The complainant presented all the three

cheques for encashment, that the said cheques were

returned dishonoured with endorsement "Funds

insufficient in the account of the accused". The

complainant got issued legal notice to the

respondent/accused calling upon him to pay the amount of

the cheques and it has been served on him. The

respondent/accused did not pay the amount of cheques

and therefore, the appellant/complainant has filed

complaint against the respondent/accused for offence

under Section 138 of the Act.

3. Learned Magistrate has taken cognizance and

registered C.C.No.29728/2010 against the

respondent/accused for offence punishable under Section

138 of the N.I. Act. The plea of the respondent/accused

has been recorded. The complainant has examined

himself as PW.1 and got marked Exs.P1 to P8. The

statement of the respondent/accused has been recorded

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under Section 313 of Code of Criminal Procedure. The

respondent/accused has not led any defence evidence.

Learned Magistrate after hearing the arguments on both

sides has formulated points for consideration and passed

the judgment of acquittal. The said judgment of acquittal

has been challenged by the appellant/complainant in this

appeal.

4. Heard learned counsel for appellant and learned

counsel for respondent.

5. Learned counsel for appellant would contend that

respondent/accused has admitted his signature on

cheques Exs.P1 to P3 and therefore, presumption under

Section 139 of the N.I. Act has to be drawn, that the

cheques have been issued for making payment of legally

enforceable debt. The said presumption is a rebuttal

presumption. The respondent/accused, who had taken the

defence that the cheques have been issued as a security

to the loan of one Venkatesh availed from the complainant

has not been established. Therefore, the said presumption

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is not rebutted. Without considering these aspects, the

learned Magistrate has harped upon the capacity of the

complainant and erred in acquitting the

respondent/accused. On these grounds he prayed for

allowing the appeal and convicting the respondent/accused

for offence under Section 138 of the Act.

6. Learned counsel for the respondent submits that

PW.1 in his cross-examination has admitted that one

Venkatesh was working as a Driver under him, and he has

availed loan from him. PW.1 in his cross-examination has

denied the suggestion that accused has issued three

signed cheques as a security to the loan availed by the

said Venkatesh, from him. PW.1 in his cross examination

has admitted that the cheques given by the accused were

signed blank cheques and he has filled in the contents of

the cheques. The said aspects itself probablises the

defence of the respondent/accused, that

appellant/complainant has not placed on record any

document regarding his capacity to lend huge amount of

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Rs.6,35,000/-. That the appellant/ complainant has not

produced any document to show that the

respondent/accused has borrowed Rs.6,35,000/-.

7. Learned counsel for appellant further submits that

the specific dates of borrowing are not stated either in the

complaint, notice and evidence of PW.1.

Respondent/accused has disputed the capacity of the

appellant to lend huge amount of Rs.6,35,000/-. The

appellant/complainant has not placed on record any

material to show his capacity to lend the said huge

amount. He placed reliance on the decision of the Hon'ble

Apex Court in the case of SRI DATTATRAYA Vs.

SHARANAPPA in 2024 INSC 586.

8. After considering all these aspects, the

respondent/accused has rebutted the presumption drawn

under Section 139 of the N.I. Act. The

appellant/complainant has not established the alleged

lending and accused borrowing Rs.6,35,000/-.

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9. After considering all these aspects, the learned

Magistrate has rightly acquitted the respondent/accused

for offence under Section 138 of N.I. Act, by a reasoned

judgment. Thus he prayed for dismissal of the appeal.

10. Having heard the learned counsel for both the

parties, the Court has perused the impugned judgment of

acquittal and trial Court records. On considering the

grounds urged, the following point arise for consideration:-

"Whether the learned Magistrate has erred in

acquitting the respondent/accused for the

offence under Section 138 of N.I. Act?"

11. My answer to the above point is in the 'Negative'

for the following reasons:

It is the case of appellant/complainant that

respondent/accused was his friend and he has borrowed a

sum of Rs.6,35,000/- on different dates for purchase of

vehicle and for family necessities. In order to repay the

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said amount borrowed the respondent/accused has issued

three cheques i.e., Exs.P1 to P3. The respondent/accused

has admitted his signature on cheques Exs.P1 to P3. The

respondent/accused has disputed that the said cheques

are issued for making payment of amount borrowed. The

respondent/accused had denied that he borrowed

Rs.6,35,000/- from the appellant/complainant. As the

respondent/accused has admitted his signatures on

cheques Exs.P1 to P3, a presumption has to be drawn that

the cheques have been issued for making the payment of

debt. The said presumption is a rebuttal presumption.

The standard of proof for rebutting the said presumption is

preponderance of probability.

12. The appellant/complainant has not stated the specific

dates, on which the respondent/accused has borrowed

amount and specific amount of borrowing on those dates.

What is stated in the complaint is that accused has

borrowed Rs.6,35,000/-. The dates of borrowing has not

been stated in the complaint. PW.1 in his chief

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examination has also not stated the dates of borrowing.

PW.1 in his cross-examination has stated that accused

borrowed Rs.6,35,000/- between the years 2006 to 2009.

PW.1 has stated that he cannot say on what dates, what

amount has been borrowed by the respondent/accused.

PW.1 in his cross-examination has stated that respondent

is not his friend and not his relative, but in his

examination-in-chief, he has stated that

respondent/accused is his friend. Since the specific dates

of borrowing is not stated, it is difficult to ascertain as to

whether the debt is barred by limitation or not.

13. It is the specific defence of the respondent/accused

that one Venkatesh has borrowed money from the

appellant/complainant and for security of loan of said

Venkatesh, the respondent/accused has issued three

signed cheques Exs.P1 to P3 as a security. PW.1 in his

cross-examination has admitted that said Venkatesh is

working as a Driver with him. He further admitted that

the said Venkatesh had availed loan from him. PW.1 also

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admitted that accused has given three signed blank

cheques and he has filled in the contents in the said

cheques. The very said admission given by PW.1

probabalizes the defence of respondent/accused.

14. The respondent/accused has disputed the capacity of

the appellant/complainant to lend huge amount of

Rs.6,35,000/-. The Hon'ble Apex Court in the case of

DATTATREYA supra has observed at paragraph 30 as

follows :-

"30. Moreover, affirming the findings of the Trial Court, the High Court observed that while the signature of the Respondent on the cheque drawn by him as well as on the agreement between the parties herein stands admitted, in case where the concern of financial capacity of the creditor is raised on behalf of an accused, the same is to be discharged by the complainant through leading of cogent evidence."

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15. In view of the above, the appellant/complainant has

to establish his capacity to lend huge amount by cogent

evidence. The appellant/complainant has not placed any

material on record to establish his capacity to lend such a

huge amount of Rs.6,35,000/-.

16. Considering all these aspects, the

respondent/accused has rebutted the presumption drawn

under Section 139 of the Act. As the presumption is

rebutted the onus shifts on the appellant/complainant to

prove the alleged lending of such huge amount. The