Kerala High Court
Justin Jose vs K.P.Biju on 5 November, 2025
Crl. Appeal No. 81/2012
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IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE JOHNSON JOHN
WEDNESDAY, THE 5TH DAY OF NOVEMBER 2025 / 14TH KARTHIKA, 1947
CRL.A NO. 81 OF 2012
AGAINST THE ORDER DATED 12.01.2012 IN Crl.L.P. NO.1 OF
2012 OF HIGH COURT OF KERALA ARISING OUT OF THE JUDGMENT
DATED IN CC NO.52 OF 2010 OF JUDICIAL MAGISTRATE OF FIRST
CLASS ,ERATTUPETTA
APPELLANT/COMPLAINANT:
JUSTIN JOSE
AGED 39 YEARS
S/O.JOSEPH, NJEZHUKUMATTIL HOUSE, PAYAPPAR.P.O.,
LALAM VILLAGE, MEENACHIL TALUK.
RESPONDENTS/ACCUSED & STATE:
1 K.P.BIJU
S/O.PRABHAKARAN, ODICHUKUTHIYIL HOUSE,
PAYAPPAR.P.O., LALAM VILLAGE,
MEENACHIL TALUK.686 651.
2 STATE OF KERALA
REP.BY THE PUBLIC PROSECUTOR,
HIGH COURT OF KERALA, ERNAKULAM-682031.
BY ADVS.
SRI.N.N.SUGUNAPALAN (SR.)
SRI.S.SUJIN
THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON
03.11.2025, THE COURT ON 05.11.2025 DELIVERED THE
FOLLOWING:
Crl. Appeal No. 81/2012
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JOHNSON JOHN, J.
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Crl. Appeal No. 81 of 2012
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Dated this the 5th day of October, 2025
JUDGMENT
This appeal by the complainant is against the acquittal of the
accused under Section 138 of the Negotiable Instruments Act, 1881 ('N.I
Act' for short).
2. As per the complaint, the accused borrowed Rs.4,00,000/- from
the complainant on 01.05.2009 agreeing to repay the same within six
months and on the same day issued a cheque dated 10.11.2009 for
Rs.4,00,000/- to the complainant.
3. Subsequently, when the complainant presented the cheque for
collection, the same was dishonoured due to insufficiency of funds in the
account of the accused and in spite of issuance of statutory notice, the
accused failed to pay the cheque amount to the complainant.
4. Before the trial court, from the side of the complainant, PW1
examined and Exhibits P1 to P6 were marked and from the side of the
accused, DW1 examined and Exhibits D1 and D2 were marked.
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5. After trial and hearing both sides and considering the oral and
documentary evidence on record, the trial court found that the
complainant has not succeeded in proving the offence under Section 138
of the N.I. Act and hence, the accused was acquitted.
6. In this appeal, when there was no representation for the
appellant, this Court appointed Sri. Ranjan Suresh as State Brief to
represent the appellant and subsequently, the learned counsel
representing the learned counsel for the appellant on record, Adv. Aneer
M.S., also turned up to argue the matter. Therefore, the learned State
Brief, Adv. Ranjan Suresh, the learned counsel appearing for the
appellant, Adv. Aneer M.S., the learned counsel for the accused/first
respondent, Adv. Rajesh K.R. and the learned Senior Public Prosecutor,
Sri. Alex M. Thombra appearing for the second respondent were heard.
7. The learned counsel for the appellant argued that the accused
has not disputed the signature in Exhibit P1 cheque and that the trial
court ought to have found that the complainant is entitled for the benefit
of the statutory presumptions.
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8. The learned counsel for the accused/first respondent argued
that the evidence of PW1 in cross examination regarding the alleged
transaction does not tally with the averments in the complaint and that
the evidence elicited from the complainant during cross examination
creates serious doubt about the existence of the debt and about the
transaction and the complainant has also failed to establish the source of
funds for advancing such a huge loan and therefore, there is no reason
to interfere with the findings of the trial court in this regard.
9. In the chief affidavit of PW1, it is stated that on 04.04.2011,
the accused repaid Rs.40,000/- by issuing a cheque for the said amount
and on the next week, the accused paid Rs.10,000/- and therefore, only
Rs.3,50,000/- is due from the accused.
10. In cross examination, PW1 stated that the accused is known
to him for the last 10-15 years and previously, there were several
transactions between him and the accused and at that time, he used to
obtain cheques from the accused and used to return the cheques when
the accused made the payment. Regarding the source, PW1 stated that
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he sold timber to one Haneefa for a consideration of Rs.8,00,000/- and
on 20.04.2009, he received Rs.4,00,000/- as balance consideration from
Haneefa. According to PW1, on 10.11.2009, the accused came with a
filled cheque and signed the same in his presence. PW1 cannot say as to
who recorded the date and amount in Exhibit P1 cheque. PW1 would say
that the accused borrowed the amount in connection with the marriage
of someone.
11. In cross examination, PW1 admitted that it is known to him
that the accused absconded because of financial problems during
September, 2008 and subsequently, returned only during March, 2009.
PW1 further admitted in cross examination that it is known to him that
the properties of the accused were attached in insolvency proceedings
before the Sub Court, Pala. PW1 stated in cross examination that the
accused reached his house on the previous day of 01.05.2009 and even
though, he was having money with him, he has not paid the amount to
the accused on that day, as the accused has informed him that he
requires the money only on the next day. According to PW1, on the next
day i.e., on 01.05.2009, the accused again reached his house and
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received the money. PW1 denied the suggestion that the accused
borrowed Rs.40,000/- during 2007 and the cheque entrusted as security
at that time was misused for filing this complaint and that no amount is
due from the accused.
12. DW1 is the Secretary of the Service Co- operative Bank,
Valavoor and his evidence shows that the accused and the complainant
herein are members of the said Co-operative Bank. According to DW1,
the Bank has initiated arbitration proceedings against the accused for
recovery of the loan amount and subsequently, the Bank renewed the
loan for a total amount of Rs.10,000,000/- in favour of the accused.
According to DW1, subsequently, the accused made payments to 14
persons by way of cheque on 04.04.2011.
13. The learned counsel for the appellant cited the decision of the
Honourable Supreme Court in Kalamani Tex v. P. Balasubramanian
[(2021) 5 SCC 283] and this Court in Priyamvada K. v. M.
Rahufina and others [2024(1)KLT 417] and argued that once the
accused had admitted his signature on the cheque, the trial court ought
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to have presumed that the cheque was issued as consideration for a
legally enforceable debt. The learned counsel for the appellant also cited
the decision of the Honourable Supreme Court in Bir Singh v. Mukesh
Kumar [(2019) 4 SCC 197] and argued that once the person who had
drawn a cheque admits his signature in that cheque, in the absence of
cogent evidence pointing to vitiating circumstances, he cannot be heard
to say that the other entries in that instrument were incorporated by
somebody else by way of manipulations.
14. In Basalingappa v. Mudibasappa ((2019) 5 SCC 418), the
Hon'ble Supreme Court summarised the principles of law governing the
presumptions under Sections 118 and 139 of the N.I Act in the following
manner:
"(i) Once the execution of cheque is admitted Section 139 of
the Act mandates a presumption that the cheque was for
the discharge of any debt or other liability.
(ii) The presumption under Section 139 is a rebuttable
presumption and the onus is on the accused to raise the
probable defence. The standard of proof for rebutting the
presumption is that of preponderance of probabilities.
(iii) To rebut the presumption, it is open for the accused to rely
on evidence led by him or accused can also rely on the
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materials submitted by the complainant in order to raise
a probable defence. Inference of preponderance of
probabilities can be drawn not only from the materials
brought on record by the parties but also by reference to
the circumstances upon which they rely.
(iv) That it is not necessary for the accused to come in the
witness box in support of his defence, Section 139
imposed an evidentiary burden and not a persuasive
burden. "
15. In ANSS Rajashekar v. Augustus Jeba Ananth [2019 (2)
KHC 155= 2019 (1) KLD 492], it was held that when evidence elicited
from complainant during cross examination creates serious doubt about
the existence of debt and about the transaction and the complainant fails
to establish the source of funds, the presumption under Section 139 is
rebutted and the defence case stands probabilised.
16. In APS Forex Services Pvt. Ltd. v. Shakti International
Fashion Linkers and Others [2020 (1) KHC 957 = 2020 (1) KLD
313], it was held that whenever the accused questioned the financial
capacity of the complainant in support of his probable defence despite
the presumption under Section 139 onus shifts again on the complainant
to prove his financial capacity.
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17. In John K. Abraham v. Simon C. Abraham and Another
[2013 (4) KHC 853], the Honourable Supreme Court held that in order
to draw the presumption under Section 118 read along with 139 of the
N.I Act, the burden was heavily upon the complainant to have shown
that he had required funds for having advanced the money to the
accused, while issuing cheque in favour of the complainant.
18. It is well settled that the standard of proof which is required
from the accused to rebut the statutory presumption under Sections 118
and 139 of the N.I Act is preponderance of probabilities and that the
accused is not required to prove his case beyond reasonable doubt. The
standard of proof, in order to rebut the statutory presumption, can be
inferred from the materials on record and circumstantial evidence.
19. The learned counsel for the appellant relied on the decision
of the Hon'ble Supreme Court in Sanjabij Tari v. Kishore S.Borcar
[2025(6) KHC 250(SC)] and argued that the failure of the accused to
reply to the statutory notice under Section 138 of the N.I Act leads to an
inference that there is merit in the version of the complainant and that
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the burden is on the accused to prove that there was no existing debt or
liability, as held by the Hon'ble Supreme Court in M.M.T.C Ltd. v.
Medchil Chemicals And Pharma (P) Ltd. [2002 KHC 241].
20. The decision of the Hon'ble Supreme Court in Sanjabij
Tari's case (Supra) would clearly show that ultimately, it becomes the
duty of the courts to consider carefully and appreciate the totality of the
evidence and then come to a conclusion whether, in the given case, the
accused has shown that the case of the complainant is in peril for the
reason that the accused has established a probable defence.
21. When considering the evidence in this case, it is apparent that
there existed a contradiction in the complaint moved by the appellant as
against his cross examination relatable to the time of execution and
issuance of the cheque. It is pertinent to note that the specific case of
the accused is that he borrowed Rs.40,000/- from the complainant in the
year 2007 and issued a blank signed cheque as security. In his chief
affidavit, PW1 has stated that he received Rs.40,000/- from the accused
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by way of a cheque on 04.04.2011 and Rs.10,000/- on the next week in
cash from the accused.
22. It is pertinent to note that PW1 has admitted in cross
examination that he was aware of the fact that the accused absconded
during September, 2008 because of financial problems and returned only
during March, 2009. PW1 was also aware about the attachment of the
properties of the accused in the insolvency proceedings before the Sub
Court, Pala and therefore, I find merit in the argument of the learned
counsel for the accused/first respondent that the evidence elicited from
the complainant creates serious doubt about the existence of debt and
about the transaction.
23. Even though the complainant has a case that Rs.4,00,000/-
received as balance sale consolidation from one Haneefa is the source
for advancing the amount to the accused, he has not examined the said
Haneefa to establish the source of funds and therefore, I find no reason
to disagree with the finding of the trial court that the evidence of PW1
regarding the transaction is highly improbable and unbelievable.
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24. It is well settled that the offence made punishable under
Section 138 of the N.I Act is a regulatory offence for improving the
credibility of negotiable instruments and therefore, the test of
proportionality should guide the construction and interpretation of the
statutory presumptions and the accused cannot be expected to
discharge an unduly high standard of proof. Therefore, if the accused is
able to raise a probable defence, which creates doubts about the
existence of a legally enforceable debt or liability, the prosecution can
fail. In Chandrappa v. State of Karnataka [(2007) 4 SCC 415], the
Honourable Supreme Court laid down the general principles regarding
the powers of the appellate court while dealing with an appeal against an
order of acquittal in paragraph 42 of the said judgment as follows:
"42. From the above decisions, in our considered view, the
following general principles regarding powers of the appellate
court while dealing with an appeal against an order of acquittal
emerge:
(1) An appellate court has full power to review, reappreciate and
reconsider the evidence upon which the order of acquittal is
founded.
(2) The Code of Criminal Procedure, 1973 puts no limitation,
restriction or condition on exercise of such power and an
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appellate court on the evidence before it may reach its own
conclusion, both on questions of fact and of law.
(3) Various expressions, such as, "substantial and compelling
reasons", "good and sufficient grounds", "very strong
circumstances", "distorted conclusions", "glaring mistakes", etc.
are not intended to curtail extensive powers of an appellate court
in an appeal against acquittal. Such phraseologies are more in the
nature of "flourishes of language" to emphasise the reluctance of
an appellate court to interfere with acquittal than to curtail the
power of the court to review the evidence and to come to its own
conclusion.
(4) An appellate court, however, must bear in mind that in case of
acquittal, there is double presumption in favour of the accused.
Firstly, the presumption of innocence is available to him under
the fundamental principle of criminal jurisprudence that every
person shall be presumed to be innocent unless he is proved
guilty by a competent court of law. Secondly, the accused having
secured his acquittal, the presumption of his innocence is further
reinforced, reaffirmed and strengthened by the trial court.
(5) If two reasonable conclusions are possible on the basis of the
evidence on record, the appellate court should not disturb the
finding of acquittal recorded by the trial court."
25. On a careful re-appreciation of the entire evidence, I find that
the view taken by the trial court is a possible view and in that
circumstance, I find no reason to interfere with the finding in the
impugned judgment that the complainant has not succeeded in proving
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the offence under Section 138 of the N.I Act against the accused.
Therefore, I find that this appeal is liable to be dismissed.
In the result, this appeal is dismissed.
Sd/-
JOHNSON JOHN,
JUDGE.
Rv
