Karnataka High Court
Mr N Chandra Reddy vs Mr T Damodara Reddy on 4 June, 2025
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 04TH DAY OF JUNE, 2025
BEFORE
THE HON'BLE MS JUSTICE J.M.KHAZI
CRIMINAL REVISION PETITION NO.969 OF 2022
C/W
CRIMINAL REVISION PETITION NO.910 OF 2022
IN CRL.RP NO.969/2022
BETWEEN:
MR N CHANDRA REDDY
S/O CHINNAPPA REDDY
AGED ABOUT 42 YEARS
NO 4-A, 7TH MAIN ROAD
SRI KRISHNA TEMPLE ROAD
DODDABOMMASANDRA
VIDYARANYAPURA POST
BENGALURU-560097
ALSO OFFICE AT
SRI MANJUNATHESWARA ENGINEERING
WORKS, NO 8, 6TH TEMPLE ROAD
15TH CROSS, MALLESHWARAM
BENGALURU-560003
...PETITIONER
(BY SRI.S R SREEPRASAD, ADVOCATE)
AND:
MR T.DAMODARA REDDY
AGED ABOUT 43 YEARS
S/O LATE REDDAPPA REDDY
NO 34, 3RD FLOOR, 11TH A CROSS
SP EXTENSION, SUDHEENDRA NAGAR
MALLESHWARAM, BENGALURU-560003
...RESPONDENT
(BY SRI.K A CHANDRASHEKARA, ADVOCATE)
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THIS CRL.RP IS FILED U/S.397 R/W 401 CR.P.C BY THE
ADVOCATE FOR THE PETITIONER PRAYING TO SET ASIDE THE
JUDGMENT OF CONVICTION DATED 02.02.2019 IN
C.C.NO.6204/2018 PASSED BY THE LEARNED XV ACMM,
BENGALURU CONFIRMED IN CRL.A.NO.476/2019 ON THE FILE
OF THE LXIII ADDITIONAL CITY CIVIL AND SESSIONS JUDGE
(CCH64) BANGALORE DATED 18.04.2022 BY ALLOWING THE
REVISION.
IN CRL.RP NO.910/2022
BETWEEN:
MR N CHANDRA REDDY
S/O CHINNAPPA REDDY
AGED ABOUT 42 YEARS
NO 4-A, 7TH MAIN ROAD
SRI KRISHNA TEMPLE ROAD
DODDABOMMASANDRA
VIDYARANYAPURA POST
BENGALURU-560097
ALSO AVAILABLE AT
SRI N CHANDRA REDDY
PROP: SRI MANJUNATHA
ENGINEERING WORKS
NO 8, 6TH TEMPLE ROAD, 15TH CROSS
MALLESWARAM, BENGALURU-560003
...PETITIONER
(BY SRI.S R SREEPRASAD, ADVOCATE)
AND:
MR T.DAMODARA REDDY
AGED ABOUT 43 YEARS
S/O LATE REDDAPPA REDDY
NO 34, 3RD FLOOR, 11TH A CROSS
SP EXTENSION, SUDHEENDRA NAGAR
MALLESWARAM, BENGALURU-560003
...RESPONDENT
(BY SRI.K A CHANDRASHEKAR, ADVOCATE)
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THIS CRL.RP IS FILED U/S.397 R/W 401 CR.P.C BY THE
ADVOCATE FOR THE PETITIONER PRAYING TO SET ASIDE THE
JUDGMENT OF CONVICTION DATED 02.02.2019 IN
C.C.NO.6204/2018 PASSED BY THE LEARNED XV ACMM,
BENGALURU CITY CONFIRMED AND MODIFIED IN
CRL.A.NO.821/2019 ON THE FILE OF THE LXIII ADDITIONAL
CITY CIVIL & SESSIONS JUDGE (CCH-64) AT BENGALURU
DATED 18.04.2022 BY ALLOWING THE REVISION.
THESE PETITIONS HAVING BEEN HEARD AND RESERVED
FOR ORDERS ON 20.03.2025, THIS DAY ORDER WAS
PRONOUNCED THEREIN AS UNDER:
CORAM: HON'BLE MS JUSTICE J.M.KHAZI
C.A.V ORDER
These two petitions filed under Section 397 r/w
Section 401 of Cr.P.C are by the accused, wherein he has
challenged the concurrent findings of the trial Court and
Sessions Court convicting him for the offence punishable
under Section 138 of Negotiable Instrument Act, (for short
N.I.Act) and also the order of the Sessions Court
enhancing the punishment.
2. Since these two petitions are arising out of the
same judgment and order of the trial Court and common
judgment and order passed by the Sessions Court,
exercising the appeal jurisdiction and involve common
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discussion, they are clubbed together and disposed of by
common order.
3. For the sake of convenience, parties are referred
to by their ranks before the trial Court.
4. Complainant filed a complaint under Section 200
of Cr.P.C, against the accused for the offence punishable
under Section 138 of N.I Act, contending that he and
accused are known to each other since more than 10
years. On 15.09.2014, accused borrowed hand loan of
₹3,88,000/- and it was paid by the complainant through
cheque No.727282. Similarly, on 08.10.2015, accused
borrowed sum of ₹9,70,000/- and the said payment was
made by the complainant through cheque No.063278. In
this regard, accused also executed a hand loan agreement
dated 08.10.2015. The accused had borrowed the said
sums to improve his business and promised to repay the
same within two years.
4.1 After expiry of two years, when accused failed
to keep up his promise, on repeated request and demand
by the complainant, accused issued cheque dated
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19.01.2018 for total sum of ₹13,58,000/- with an
assurance that it would be honoured on presentation.
However, on 19.01.2018, when complainant presented the
cheque for encashment, it was returned dishonoured on
the ground "funds insufficient". Immediately, complainant
brought this fact to the notice of accused, but he didn't pay
the amount due and went on dragging. Therefore,
complainant got issued legal notice dated 29.01.2018 to
both addresses of the accused. They are duly served on
the accused. Instead of paying the amount due, the
accused has sent an evasive reply without any alternative
complaint is filed.
5. On service of notice, accused appeared through
counsel and contested the case by pleading not guilty to
the charge levelled against him.
6. In order to prove the allegations, the
complainant examined himself as PW-1 and got marked
Exs.P1 to 11.
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7. During the course of the statement under
Section 313 of Cr.P.C accused has denied the incriminating
evidence by the complainant.
8. Accused has also given evidence as DW-1 and
produced Exs.D1 to 9.
9. Vide the impugned judgment and order, the trial
Court, convicted the accused and sentenced him to pay
fine of ₹13,63,000/- and out of it ordered for payment of
₹13,58,000/- by way of compensation.
10. Aggrieved by the same accused approached the
Sessions Court in Criminal Appeal No.476/2019.
Complainant also challenged the said order in Criminal
Appeal No.821/2019 seeking enhancement of the
punishment.
11. Vide common judgment and order dated
18.04.2022, the Sessions Court dismissed the appeal filed
by the accused and allowed the appeal filed by the
complainant and enhanced the fine amount to
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₹18,05,000/- and out of it ordered for payment of
compensation a sum of ₹18,00,000/- to the complainant.
12. Aggrieved by dismissal of his appeal and
allowing the appeal of the complainant by enhancing the
fine amount, accused is before this Court contending that
the Courts below have erred in convicting the accused
ignoring the fact that the very amount said to have been
paid by the complainant could be at no stretch of
imagination excepted as a loan transaction. The Courts
below ought to have accepted the defence of the accused.
The complainant has claimed that accused has executed a
loan agreement, the same is not produced. Since the
accused has denied issuance of the cheque, the burden is
on the complainant to prove the legality as held in
Narayana Menon vs State of Kerala (Narayan Menon)1.
However, the complainant has failed to discharge the said
burden.
12.1 The Courts below have wrongly held that since
the signature in the cheque is admitted, burden is on the
1
2006 (6) SCC 39
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accused to prove his case. Ignoring the circumstances in
which the cheque came to be issued, the Sessions Court
has also erred in enhancing the fine without there being
any special circumstances. Viewed from any angle, both
judgments and orders are not sustainable and pray to
allow the revision petitions and set aside the same.
13. In support of his arguments, learned counsel for
the accused has relied upon the following decisions;
(i) Basalingappa vs Mudibasappa (Basalingappa)2
(ii) Shiva Murthy vs Amruthraj (Shiva Murthy)3
(iii) M/s.Hill Range Power Project Developers and
others vs M/s. Acciona Wind Energy Private Ltd.,
(Hill Range Power)4
(iv) The Bidar Urban Co-operative Bank Ltd.,
Hyderabad road, Bidar vs Mr.Girish s/o late
Gunderao Kulkarni (Girish Kulkarni)5
(v) Sri Muniraja D vs Sri Anil Kumar (Muniraja)6
14. On the other hand, learned counsel for
complainant supported the impugned judgments and
orders. He would submit that since the complainant and
2
Crl.A.No.636/2019, dated 09.04.2019
3
ILR 2008 KAR 4629
4
Crl.P.No.6072/2014, dated 24.02.2015
5
Cl.A.No.200057/2016, dated 17.12.2020
6
Crl.P.No.7324/2022 dated 25.08.2022
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accused are known to each other, on the request of
accused, complainant advanced hand loan in a total sum of
₹13,58,000/- by way of two cheques and the payments
were credited to the account of accused. He had requested
for two years time to repay the same. After expiry of two
years, when accused failed to repay the amount due, on
the repeated request and demand, he issued the subject
cheque for ₹13,58,000/-. However, when presented it was
dishonoured for want of sufficient funds. Therefore, after
issuing legal notice and on the failure of accused to comply
with the same, complainant filed the complaint in question.
14.1 He would further submit that the accused has
not only failed to repay the amount due under the cheque,
but also taken an untenable defence and failed to establish
the same. Therefore, appreciating the evidence placed on
record, the trial Court has rightly convicted the accused.
Since the sentence imposed was not proportionate to the
gravity of the offence, complainant also challenge the said
judgment and order so far as punishment is concerned.
The Sessions Court on re-appreciation of the entire oral
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and documentary evidence has not only confirmed the
conviction, but also enhanced the punishment and there is
no perversity calling for interference by this Court and pray
to dismiss the petitions also.
15. In support of arguments, learned Council for
complainant has relied upon the following decisions:
(i) Somashekar vs C.V Raju (Somashekar)7
(ii) Thomas Mani s/o Thomas vs G Shankar
(Thomas Mani)8
16. Heard arguments and perused the record.
17. Having regard to the fact that the subject
cheque at Ex.P1 is drawn on the account of the accused
and it bears his signature, presumption under Section 139
of N.I.Act comes to play, placing the initial burden on the
accused to rebut the presumption that the cheque was not
issued towards repayment of any legally recoverable debt
or liability, but on the other hand, in what circumstances it
reached the hands of the complainant. Only after accused
7
Crl.RP.No.72/2024 dated 25.01.2024
8
Crl.RP.No.851/2016 dated 24.02.2025.
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rebut the presumption, the burden would shift on the
complainant to prove his case.
18. It is the definite case of the complainant that he
has advanced hand loan of ₹3,88,000/- and ₹9,70,000/-
and the said amount was paid through cheques and the
amount is credited to the account of the accused. Accused
admit that he has received a total sum of ₹13,58,000/-
from the complainant and the said sum has reached his
account through two payments. However, he claims that
he is a labour contractor and complainant is in construction
business and he has supplied labours and these two
payments are towards the money due to him for supplying
the labours and not hand loan as claimed by the
complainant. He has also made an allegation that
complainant was in the habit of visiting his house and
accused used to keep signed blank cheques for the
purpose of making payments in emergent situations and
complainant has committed theft of one such cheque and
filing the amount for a sum of ₹13,50,000/- he has
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presented it for encashment and on its dishonour has
chosen to file the present complaint.
19. In order to prove that he is engaged in labour
contracting work and complainant is doing construction
business which requires supply of labours, accused has not
produced relevant documents. He has produced income
tax returns for the assessment year 2015-16 and 2016-17
at Exs.D7 and 9. In Ex.D9 under schedule five, it is stated
that he has received gross labour charges in the sum of
₹19,69,385/-. However, the accused has not produced any
documents to prove that he was doing labour contracting
business. Moreover, this figure ₹19,69,385/- cannot be
accepted as including the amount received from the
complainant, which according to him is a hand loan unless
the accused establish that he is a labour contractor and
complainant is a civil contractor engaged in construction
business.
20. The accused has also produced two bills dated
10.09.2014 for ₹3,90,950/- and 05.06.2015 for
₹9,80,155/- for having supplied labour and claimed that
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they bear the signature of complainant. He has also
claimed that original of these bills are with the
complainant. It appears since they are photocopies, they
are not marked. Even if original of these bills were given
to the complainant and his signature was taken on photo
copy, then the photo copy of the bills with the original
signature of complainant would be available with the
accused and he could have produced the same instead of
producing its Xerox copy. The accused could have
maintained account regarding the supply of labour. He
could have produced the account books. In the absence of
the same, the accused has failed to prove that complainant
is civil contractor engaged in construction work and the
accused is a labour contractor and he has supplied labour
to the complainant and the payments made to him by the
complainant was towards the same.
21. If at all accused has supplied the labour and
complainant has paid the amount due for the same, the
next question will be why complainant would commit theft
of the subject cheque. The accused has not come up with
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any dispute between complainant and him prompting the
complainant to commit theft of Ex.P1. During his cross
examination, the accused stated that he came to know
that the said theft was committed during November-
December-2017, Ex.P1 is dated 19.01.2018. The
complainant has claimed that after receipt of legal notice
when he went to lodge complaint with the police, they
refused to receive it and on the other hand, advised him to
defend the criminal case. Admittedly, the accused has not
chosen to produce document to show that he tried to lodge
a complaint with the concerned police. He has also not
tried to approach the higher police officers and file the
complaint. Accused has also not filed any private complaint
against the complainant, alleging theft of Ex.P1.
22. If at all accused has come to know about the
theft of Ex.P1 during November-December 2017, the best
thing he could have done was to apprise the bank about
the theft of the cheque and instruct it to stop payment.
This would have prevented his prosecution or at least
supported his defence that it is a case of theft of cheque.
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In the absence of the same, the accused has failed to
rebut the presumption and therefore the burden has not
shifted on the complainant to prove his case. Nevertheless,
through the oral and documentary evidence, the complaint
has proved his case.
23. So far as decision in Narayana Menon is
concerned, it is not applicable to the case on hand, as in
that case on facts it was held that complainant has failed
to prove the allegations against accused and dismissed the
complaint by setting aside the orders passed by the High
Court and acquitted the accused.
24. Now coming to the petition filed by the
accused challenging the enhancement of punishment.
According to the complainant, the total hand loan given to
the accused is ₹13,58,000/-. The trial Court has imposed
to fine of ₹13,63,000/- i.e it has only added a sum of
₹5,000/- to the amount advanced to the accused and
ordered the said amount to be paid to the Government to
defray the trial expenses. The transaction is of the year
2014 and 2015. According to the complainant, since the
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accused had promised to repay the said amount within two
years, he waited for two years and on his failure,
demanded and secured the cheque at Ex.P1 dated
19.01.2018. Accordingly, he filed the complaint in 2018
and it came to be disposed off on 02.02.2019, by the time
the case came to be disposed of already five years had
elapsed.
25. If the complainant had used it for his business
purpose, he would have earned handsome returns. At least
had he kept the said amount in fixed deposit, he could
have earned some interest. Added to that the complainant
had also spent for litigation. The trial Court has not given
any reasons as to why he has ordered payment of only the
amount which was advanced by the complainant to the
accused by way of hand loan. The trial Court has not
exercised its discretion in judicious manner. Therefore,
rightly the Sessions Court has allowed the appeal filed by
the complainant and increased the fine to ₹18,05,000/-
which is quite reasonable. This Court finds no perversity in
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the reasons assigned by the Sessions Court in enhancing
the fine.
26. In the result both petitions filed by the accused
fail and accordingly the following:
ORDER
i) Petitions filed by the accused under
Section 397 r/w 401 Cr.P.C are dismissed.
ii) The impugned judgment and order dated
18.04.2022 in Crl.A.Nos.476/2019 and
821/2019, on the file of LXIII Addl.City
Civil and Sessions Judge, (CCH-64)
Bengaluru, is confirmed.
iii) The Registry is directed to send back the
trial Court as well as Sessions Court
records along with copy of this judgment
forthwith.
Sd/-
(J.M.KHAZI)
JUDGE
RR
