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NC: 2024:KHC:43167 CRL.RP No. 230 of 2022
IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 25TH DAY OF OCTOBER, 2024 BEFORE THE HON'BLE MR JUSTICE V SRISHANANDA CRIMINAL REVISION PETITION NO. 230 OF 2022 BETWEEN:
SRI. SOLOMON D'PAUL, S/O LATE DANIEL, AGED ABOUT 51 YEARS, PROPRIETOR OF DMR ENTERPRISES, R/AT CARMELARAM POST, SARJAPURA ROAD, KODATHI GRAMA, VARTHUR HOBLI, BANGALORE - 560 035. …PETITIONER (BY SRI. V. CHANDRASHEKAR, ADVOCATE) AND:
SRI. P. RAMAKRISHNA, S/O LATE PULLAPPA, AGED ABOUT 53 YEARS, R/AT NO. 9/2, KASAVANAHALLI, SARJAPURA ROAD, KODATHI GRAMA, VARTHUR HOBLI, BANGALORE - 560 042. …RESPONDENT (BY SRI. SRIDHAR CHAKRAVARTHI M.V, ADVOCATE)
THIS CRL.RP IS FILED U/S.397 R/W 401 OF CR.P.C PRAYING TO SET ASIDE THE JUDGMENT DATED 21.10.2021 PASSED BY THE LII ADDITIONAL CITY CIVIL AND SESSIONS JUDGE, BENGALURU IN CRL.A.NO.1598/2018, THEREBY SET ASIDE THE JUDGMENT DATED 18.07.2018 PASSED BY THE XIX ADDL.C.M.M., BENGALURU IN C.C.NO.4996/2015, BY ACQUITTING THE ACCUSED IN THE ABOVE CASE.
THIS PETITION, COMING ON FOR FINAL HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
Digitally signed by MALATESH K C Location: HIGH COURT OF KARNATAKA
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CORAM: HON'BLE MR JUSTICE V SRISHANANDA
ORAL ORDER
Heard Sri.V.Chandrashekar, learned counsel for the revision petitioner and Sri.Sridhar Chakravarthi M. V., learned counsel for the respondent. 2. The present revision petition is filed by the accused/revision petitioner challenging the order of conviction and sentence passed in CC No.4996/2015 dated 18.07.2018 on the file of XIX ACMM, Bengaluru for the offence punishable under Section 138 of the Negotiable Instruments Act which was confirmed in Criminal Appeal No.1598/2018 dated 21.10.2021 on the file of LII Addl. City Civil and Sessions Judge, Bengaluru (CCH-53) 3. Brief facts of the case which are utmost necessary for disposal of the revision petition are as under: 3.1. A complaint came to be filed under Section 200 of Cr.P.C. with the jurisdictional Magistrate in PCR
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No.57/2014 alleging the commission of offence punishable under Section 138 of the Negotiable Instruments Act. 3.2. Averments of the complaint would go to show that in respect of repayment of the loan obtained by the accused, accused passed on a cheque bearing No.727218 dated 02.12.2013 drawn on Chartered Sahakari Bank Niyamitha, Koramangala Branch, Bengaluru which on presentation came to be dishonored with an endorsement ‘funds insufficient’. 3.3. Statutory notice was issued demanding the payment covered under the cheque to the accused by the complainant. Callings of the said notice is not complied nor there was a reply. Therefore, complaint was filed to take action against the accused for the commission of offence punishable under Section 138 of the Negotiable Instruments Act. 4. The learned Trial Magistrate after completing necessary formalities, took cognizance of the aforesaid
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offences and summoned the accused. Accused entered appearance. Thereafter, plea was recorded and accused pleaded not guilty. Therefore, the trial was held. 5. In order to prove the case of the complainant, complainant got examined himself as P.W.1 and relied on fourteen documents which were exhibited and marked as Exs.P.1 to Ex.P.14 comprising of cheque, signature of the accused, bank endorsement, copy of the legal notice, postal receipt, letter to post master, settled reply, receipt, I.T. returns, application under Section 65(b) and bank statements. 6. P.W.1 was cross-examined at length by the accused questioning the lending capacity, as also about the defence of the accused that accused had a loan transaction of Rs.1,00,000/- for the purpose of meeting the expenses of his brother-in-law which was repaid and in that connection, Ex.P.1 was issued in the year 2012 which has been misused by the complainant and filed the false case has been denied by P.W.1. Bu, no useful material is
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also elicited in such cross-examination so as to disbelieve the version of the complainant nor dislodge the presumption available to the complainant under Section 139 of the Negotiable Instruments Act. 7. Thereafter, the learned Trial Magistrate recorded the accused statement as is contemplated under Section 313 of Cr.P.C. wherein, accused has denied all the incriminatory materials. 8. Subsequent there to, in order to rebut the presumption available to the complainant, accused stepped into the witness box and got examined himself as D.W.1. 9. In the cross-examination of D.W.1, it is elicited that complainant is known to the accused for last fifteen years and he had obtained loan from the complainant in a sum of Rs.1,00,000/- on 14.10.2012. He has answered that he did not reply the legal notice. However, he admits
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that address shown in the legal notice and the postal acknowledgement is that of his address. 10. He has also answered that the cheque has been filled in sum of Rs.10,00,000/- as against loan of Rs.1,00,000/-. He has further answered that he cannot say for what purpose and in which transaction, Ex.P.1 came to be issued. 11. He admits that he has not called the complainant after receiving the summons in the present case nor sent any e-mail. He also admits that after repayment of the alleged sum of Rs.1,00,000/-, he did not demand return of the cheque either personally or through e-mail. However, he has answered that he orally demanded return of cheque. He admits that he has no document to show that he has repaid sum of Rs.1,00,000/- loan obtained by him.
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He further admits that he has not lodged any police complaint against the alleged misuse of the cheque nor got issued any legal notice through his Advocate. 13. On conclusion of recording of evidence of the parties, learned Trial Magistrate heard the arguments of the parties in detail and taking note of the fact that Ex.P.1 i.e., cheque, belongs to the accused and signature found there in is that of the accused, believed the statement made by the complainant on oath that he lent sum of Rs.10,00,000/- for purchase of lorry and raised presumption as is contemplated under Section 139 of the Negotiable Instruments Act in favour of the complainant. 14. No doubt, it is a rebuttable presumption. Learned Trial Magistrate recorded a categorical finding that the oral evidence placed on record by the accused was not sufficient to rebut the said presumption and therefore, convicted the accused for the offence punishable under Section 138 of the Negotiable Instruments Act and imposed fine in a sum of Rs.20,00,000/- out of which sum
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of Rs.19,90,000/- was ordered to be paid as compensation to the complainant and balance sum of Rs.10,000/- to be paid towards defraying expenses of the State. 15. Being aggrieved by the said order of conviction and sentence passed by the learned Trial Magistrate, the accused preferred an appeal before the First Appellate Court in Criminal Appeal No.1598/2018. 16. Learned Judge in the First Appellate Court after securing the records, heard the arguments of the parties in detail and dismissed the appeal of the accused vide judgment dated 21.10.2021. 17. Being further aggrieved by the same, accused is before this Court, in this revision on following grounds: The impugned judgement passed by the court below is erroneous against the law and facts and circumstances of the case, Hence same is liable to be set aside.
It is submitted that the appellate court has gravely erred in upholding the judgement of conviction passed by the trial court against the accused/petitioner for an offence under Section 138 of the N.I Act, by imposing fine of
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Rs.20,00,000/- ( Rupees Twenty Lakhs), in default he shall undergo simple imprisonment for 3 months.
It is further submitted that the court below has utterly failed in appreciation of evidence and materials placed before them also failed in appreciating the defense evidence.
The appellate court has erred in dismissing the appeal even though there is no legally enforceable debt and there is no transaction of whatsoever in nature between the appellant and respondent as alleged in the complaint.
The court below wrongly came to the conclusion without going to the very root of the case on the presumption & assumption basis to fix the liability on the petitioner against the natural justice.
It is further submitted that, the appellate court has acted illegally and with material irregularity in passing the impugned judgement though the respondent/complainant has failed to establish that on which date he has given Rs. 10,00,000/- (Rupees Ten Lakhs) to accused/petitioner to these aspects there is no whisper either in the legal notice i.e., EX.P3 or in complaint or in his evidence.
It is further submitted that the appellate court failed to observe that the P.WI in his cross- examination utterly failed to mention the exact date, time and place, the alleged loan amount of Rs. 10,00,000/- paid to the petitioner/ accused.
It is further submitted that the respondent has not produced any evidence to show that the respondent herein has paid the huge amount of Rs.10,00,000/- as a hand loan to the appellant on the date of alleged loan transaction and also without obtaining any documents or security for
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discharge of loan amount from the petitioner herein and the complainant has not produced any documentary evidence to show that there was agreement between the petitioner and respondent to the alleged loan transaction.
It is further submitted that that the appellate court failed to note that the respondent has stated in his cross-examination that the alleged amount of Rs.10,00,000/- paid in cash to accused. But, the P.W1 failed to produce any witness to the alleged transaction and further P.W1 has clearly stated in his cross- examination that there is no witnesses present at the time of paying the alleged huge amount of Rs. 10,00,000/- to the accused/petitioner, this itself shows that the respondent has not paid any amount to the accused/petitioner.
It is further submitted that the apellate court failed to observed that the P.W.1 in his cross- examination has clearly admitted thay he generally do all transaction cheque only, except the alleged loan amount of Rs.10,00,000/- claiming to be paid in cash to the accused.
The petitioner further submits that, the learned court below failed observe that while filing of the complaint, the respondent/complainant failed to mention when the legal notice was served on the accused and further the respondent failed to furnish cause of action for the filing of the complaint against the accused/petitioner in his complaint.
The petitioner further submits that the court below failed to observe that the P.WI in cross- examination clearly stated that he does not know that who has written the alleged cheque and also there is a 2 different pen used to write the alleged cheque. The learned magistrate failed to observe
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that the contradicting statement with regard to issue of cheque
The petitioner further submits that the court below has given much importance to the stray sentence in the cross-examination of D.W1, and the trial court observed at Page No.13 of last para that "More over accused himself could not say for which transaction the cheque Ex.P-1 was given to complainant" based on this trial court convicted the accused. Which has resulted in grave injustice to the appellant which led to in conviction.
The appellant further submits that the trial court has not considered the contention of the accused/petitioner that the accused has given the alleged cheque as a security for the hand loan of Rs.100,000/- received by the accused on 14-01- 2012 and the same was repaid in month of May 2013 and the respondent P.W1 clearly admitted in his cross-examination. But, the court below has failed to appreciate the contention/rebuttal of the appellant/ accused which resulted in grave injustice to accused.
The respondent has not made out any prima-facie case against the petitioner & the complainant has not proved his case beyond any doubt, he has filed the alleged complaint with ulterior motive in order to harass the appellant for wrongful gain. The appellant has not issued alleged cheque to the respondent for the discharge of the alleged loan transaction.
The first appellate court did not appreciate and correctly viewed the citation produced by the petitioner.
The first appellate court even though at para-26 of its judgement referring to the supreme court judgement in Krishna Janardhan Bhat case that the advance taken by way of loan of more than
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Rs.20,000/- was only to be made by way of account payee cheque, inspite of this decision the first appellate court has wrongly taken a view that it is on the person who has taken the loan but the burden of proving the case is on the person who has advance the loan amount and he has to establish his financial capacity, this aspect has been ignored by the first appellate court, which has resulted in the dismissal of the appeal.
The first appellate court also wrongly analysed sec. 269 of Income Tax act that the burden is on the another person who has received the amount. Even though Krishna Janardhan Bhat case is very clear that any loan more than Rs.20,000/- has to be made only by way of an account payee cheque. Inspite of this the first appellate court has wrongly viewed and which resulted in dismissal of the above appeal.
The first appellate court at para-39 has clearly observed that P.WI in his cross-examination has stated that he is doing agriculture and real estate business and he is having 10,00,000 to 15,00,000/- income and he is also income tax assesse but as per Ex.P7 to 10, which does not discloses or no entry has been found in this regard of payment of loan given to the petitioner and there is no entries in this regard thus the first appellate court even though there is no entry, the first appellate court has taken a wrong view that the petitioner had received 10,00,000/- from the complainant, this wrongly viewed aspect has resulted in dismissal of the appeal.
The trial court also held in coming to conclusion that at page 35 of its judgement that during the course of cross-examination P.WI was suggested that he has no financial capacity to lend cash of Rs. 10,00,000/- and he had not given loan of the said amount to the accused and the said suggestion was denied by the complainant. Mere
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denial of the suggestion does not discharge the burden of the complainant, this crucial aspect has been oversighted and which led to dismissal of the above appeal.
The petitioner submit that even though both the court below failed appreciate that there was no financial capacity to the complainant and Ex.P7 to 10 there is entries found and no returns has been filed in respect of the loan amount of Rs. 10,00,000/- even though the burden of proof and discharge of the liability both the erred in dismissal of the appeal and imposing exorbitant fine amount which is arbitrary.
The petitioner submits that he did not commit any offence under Sec. 138 of N.I act. The learned magistrate intentionally has not considered the citation produced by the appellant/accused in support of the appellant case.
The petitioner submits that the impugned judgement is illegal, improper and incorrect and has resulted in miscarriage of justice and the sentence passed by the court below is too harsh and severe.
Sri.V.Chandrashekar, learned counsel for the revision petitioner, reiterating the grounds urged in the revision petition, vehemently contended that accused has admitted the financial transaction he had with the complainant in the year 2012 in a sum of Rs.1,00,000/- and he had repaid the same.
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He further contended that at the time of taking Rs.1,00,000/- as loan, accused had given a cheque at Ex.P.1 in a blank form towards security and even after repayment of the said amount, complainant failed to return the cheque which has been misused by him and filled sum of Rs.10,00,000/- in the said cheque and filed a false case which has not been properly appreciated by learned Trial Magistrate and learned Judge in the First Appellate Court which has resulted in miscarriage of justice. 20. He also argued that the complainant had no lending capacity as is contended by him and therefore, learned Trial Magistrate ought not to have raised the presumption in favour of the complainant especially when the income tax returns does not contain that complainant possessed Rs.10,00,000/- to lend in favour of the accused and therefore, sought for allowing the revision petition. 21. Alternatively, he also contended that in the event, this Court, upholding the order of conviction, since
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there is no special reasons forthcoming in the impugned judgment for imposing double the cheque amount and sought for reducing the fine amount. 22. Per contra, Sri.Sridhar Chakravarthi M. V., learned counsel for the respondent supports the impugned judgments. 23. He contended that there is a categorical admission in the cross-examination of the accused that after engaging the services of an Advocate and appearing before the learned Trial Magistrate, no positive action has been taken by the accused for the alleged misuse of the cheque which exposes hollowness in the contentions urged on behalf of the accused and sought for dismissal of the revision petition. 24. Insofar as alternate submission is concerned, learned counsel for the respondent contended that admittedly, the transaction is of the year 2013 and taking note of Section 80 of Negotiable Instruments Act, learned
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Trial Magistrate and learned Judge in the First Appellate Court were justified in imposing double the cheque amount as compensation which needs no interference by this Court, in this revision. 25. In view of the rival contentions of the parties, this Court perused the material on record meticulously and following points would arise for consideration: 1. Whether the revision petitioner has made out that the impugned judgments are suffering from patent factual error or jurisdictional error resulting in the impugned judgment has perverse in nature and thus, calls for interference? 2. Whether sentence is excessive? 3. What order? REG.POINT NO.1: 26. In the case on hand, cheque at Ex.P.1 and signature found therein is that of the accused is not in dispute. Admittedly, it is the contention of the complainant that accused issued the cheque towards
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repayment of hand loan in a sum of Rs.10,00,000/- which he has borrowed for purchase of a lorry. 27. According to the accused, he had a transaction on 14.10.2012 where under, accused has borrowed sum of Rs.1,00,000/- from the complainant for meeting the marriage expenses of his brother-in-law and same was repaid. At the time of taking the loan, he had issued Ex.P.1 in blank form and same has been misused by the complainant even after repayment of sum of Rs.1,00,000/-. 28. To substantiate the said aspect of the matter, accused has stepped into the witness box and deposed that there is misuse of the cheque. Except the oral testimony of the accused, there is no other material evidence placed on record. Even for establishing repayment of Rs.1,00,000/-, there is no document on record. Accused in his cross-examination admitted that he did not demand the return of cheque in writing or through e-mail. No prudent person would repay the amount and
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allow the cheques said to have been given as security with the opposite party without a proper receipt. 29. Further, accused did not establish that the cheque at Ex.P.1 was received by him from his banker in the year 2012 and same was lying with the complainant on and from 14.10.2012 which has been misused by him subsequently. 30. Further, accused has also admitted in his cross- examination that even after he engaged the services of an Advocate, when he appeared before the learned Trial Magistrate, he did not chose to take any positive action against the complainant for the alleged misuse of the cheque either by filing the police complaint or issuing any legal notice. 31. Thus, only on the self-serving testimony of the accused, the defence cannot be accepted and at any rate, the self-serving testimony would not be sufficient enough to rebut the presumption available to the complainant
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under Section 139 of the Negotiable Instruments Act especially when the complainant has placed on record income tax returns and other related documents to establish his financial capacity. 32. In this regard, this Court, gainfully places reliance on the principles of law enunciated by the Hon’ble Apex Court in the case of Rajesh Jain V.s, Ajay Singh reported in 2023(10) SCC 148. In view of the legal principles enunciated in the said decision, the learned Trial Magistrate was justified in raising the presumption available to the complainant under Section 139 of the Negotiable Instruments Act and noted that there is no sufficient rebuttal evidence and rightly convicted the accused which has been rightly reappreciated by the learned Judge in the First Appellate Court. Therefore, point No.1 is answered in negative.
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REG.POINT No.2: 33. Admittedly, the cheque is issued in a sum of Rs.10,00,000/-. Learned Trial Magistrate or the learned Judge in the First Appellate Court did not assign any special reasons for imposing double the cheque amount as the fine amount. No doubt, the statute provides such a power for the learned Trial Magistrate but while exercising such a power, there must be sufficient reasons for maintaining double the cheque amount as the fine amount. It is settled principles of law and requires no emphasis that the reasons are the heart beat of the given judgment and to support such a decision by the Court, there must be a proper reasoning forthcoming in the judgment. 34. Sri.Sridhar Chakravarthi M. V., learned counsel for the respondent however tried to impress upon the Court that the transaction is of the year 2013 and complainant is yet to receive the money from the accused and interim order granted by this Court is also not
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complied which exposes the conduct the accused and taking note the interest rate prescribed under Section 80 of the Negotiable Instruments Act, the imposition of double the cheque amount by the learned Trial Magistrate confirmed by the learned Judge in the First Appellate Court needs no interference from this Court that too in the revisional jurisdiction. 35. However, learned counsel for the revision petitioner contended that the financial condition of the accused has resulted in not complying the interim order for which he should not be penalized by the Court by imposing double the cheque amount. 36. Taking note of the rival contentions, in the absence of any special reasons forthcoming on record and no basis is made in the examination-in-chief of P.W.1 for imposing double the cheque amount as the fine amount is not justified is the considered opinion of this Court and if the fine amount is reduced from Rs.20,00,000/- to Rs.18,00,000/- and entire sum of Rs.18,00,000/- is
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ordered to be paid as compensation by setting aside the imposition of Rs.10,000/- as defraying expenses of the State as lis is privy to the parties and no State machinery is involved, would meet the ends of justice in the facts and circumstances of the case. Accordingly, point No.2 is answered in partly affirmative. REG.POINT No.3: 37. In view of the findings of this Court on point Nos.1 and 2 as above, following: ORDER i. Criminal Revision Petition is allowed in part. ii. While maintaining the conviction of the accused for the offence punishable under Section 138 of the Negotiable Instruments Act, the compensation amount ordered by the learned Trial Magistrate confirmed by the First Appellate Court in a sum of Rs.20,00,000/- is reduced to sum of Rs.18,00,000/- and balance sum of
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Rs.10,000/- imposed as fine towards the defraying expenses of the State is hereby set aside. iii. Entire fine amount of Rs.18,00,000/- is to be paid as compensation to the complainant. iv. Time is granted for the accused to pay the balance fine amount till 31.12.2024 failing which the accused shall undergo simple imprisonment for a period of one year. v. Office is directed to return the Trial Court Records with copy of this order forthwith.
Sd/- (V SRISHANANDA) JUDGE
KAV List No.: 1 Sl No.: 43 CT: BHK