Commissioner of Income Tax, vs. Agricultural Market Committee,

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NC: 2024:KHC:33063 CRL.A No. 16 of 2013

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 19TH DAY OF AUGUST, 2024 BEFORE THE HON'BLE MRS JUSTICE M G UMA CRIMINAL APPEAL NO. 16 OF 2013 (A) BETWEEN:

(BY SRI. G. SUKUMARAN, ADVOCATE (VIDEO CONFERENCE)) AND:

(BY SRI. J.S. SHIVANANDA SWAMY, ADVOCATE (ABSENT))

THIS CRIMNAL APPEAL IS FILED UNDER SECTION 378(4) OF CR.P.C. PRAYING TO SET ASIDE THE ORDER OF ACQUITTAL RECORDED AGAINST THE RESPONDENT IN C.C. NO.26458/2007 DATED 05.12.2012 PASSED BY THE XXI - ADDITIONAL SMALL

Digitally signed by SWAPNA V Location: high court of karnataka

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NC: 2024:KHC:33063 CRL.A No. 16 of 2013

CAUSES JUDGE AND XIX - ADDITIONAL CHIEF METROPOLITAN MAGISTRATE, BANGALORE - ACQUITTING THE RESPONDENT/ ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF N.I.ACT.

THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MRS JUSTICE M G UMA

ORAL JUDGMENT

The appellant being the complainant in CC No.26584/2017 on the file of learned XXI Additional Small Causes Judge and XIX

Additional Chief Metropolitan Magistrate, Bengaluru City, is impugning the judgment of acquittal dated 05.12.2012 for the offence punishable under Section 138 of Negotiable Instrument Act (for short ‘the NI Act). 2. For the sake of convenience, the parties shall be referred to as per their rank and status before the Trial Court. 3. Brief facts of the case are that the complainant filed the private complaint against the accused alleging commission of offence punishable under Section 138 of NI Act. It is the contention of the complainant that he had lent an amount of Rs.3,50,000/- to the accused and towards repayment of the

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NC: 2024:KHC:33063 CRL.A No. 16 of 2013

same, he had issued a cheque Ex.P.1 for Rs.3,50,000/-. When the cheque was presented for encashment, the same was dishonoured as account was closed. Legal notice as per Ex.P3 was issued both under RPAD and under certificate of posting. The accused had received the said legal notice sent to him under UCP and notice sent through RPAD was returned unserved as refused. Even after refusal of the notice, accused has not repaid the cheque amount and thereby he has committed the offence punishable under Section 138 of NI Act. Accordingly, he prayed the trial Court to take cognizance of the offence and to initiate legal action. 4. The trial Court took cognizance of the offence and summoned the accused. The accused has appeared before the trial Court and pleaded not guilty for the offence punishable under Section 138 of NI Act. The complainant examined himself as PW1 and got marked Exs.P.1 to 8 in support of his contention. The accused denied all the incriminating materials available on record and examined himself as DW1. He got marked Ex.D.1 in support of his defence. The trial Court after taking into consideration of all these materials on record, came to the conclusion that the complainant is not successful in

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NC: 2024:KHC:33063 CRL.A No. 16 of 2013

proving the lending of the amount, his financial capacity to lend such amount of Rs.3,50,000/- and therefore, the accused is entitled for acquittal. Being aggrieved by the same, the complainant is before this Court. 5. Heard Sri. G.Sukumaran, learned counsel for the appellant. Learned counsel for the respondent is absent. No representation. Perused the materials including trial Court records. 6. It is the contention of the learned counsel for the appellant that an amount of Rs.3,50,000/- was lent to the accused by the complainant during August, 2007. Towards repayment of the said amount, the cheque for Rs.3,50,000/- was issued. The accused has not denied issuance of cheque with his signature. He has also not disputed the service of notice on him. Under such circumstances, presumption under Section 139 of NI Act would arise. Inspite of that, the trial Court acquitted the accused without any basis. The trial Court committed an error in not raising legal presumption under Section 139 of NI Act. Hence, prays for allowing appeal by setting aside the judgment of acquittal.

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NC: 2024:KHC:33063 CRL.A No. 16 of 2013

"Whether the impugned judgment of acquittal passed by the Trial Court suffers from perversity or illegality and calls for interference by this Court?"

My answer to the above point is in the 'Negative" and pass the following: REASONS 8. It is the contention of the complainant that he had lent an amount of Rs.3,50,000/- to the accused. According to the complainant, an amount of Rs.3,50,000/- during August 2007 was paid in cash. The accused has taken a defence admitting that cheque Ex.P.1 belongs to him and it bears his signature. On admission of cheque and signature by the accused, the presumption under Section 139 of NI Act would arise. However, the defence taken by the accused is that, he had borrowed some amount from one Ramdas and had issued the blank cheque Ex.P.1 in his favour with his signature. During cross-examination of PW1, it is elicited by the learned counsel for the accused that he does not know when the accused has

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NC: 2024:KHC:33063 CRL.A No. 16 of 2013

closed his account. The specific defence taken by the accused that blank cheque Ex.P.1 was issued by the accused in favour of Ramdas and same was misused by the complainant. Of course this suggestion was denied by PW1. PW1 states that he took voluntary retirement from the service during 2001 but lending of amount was during August 2007. PW1 contends that he had kept his retirement benefits in his bank account with SBI. He admits that he had no source of income after his retirement in the year 2001. He had withdraw the amount from SBI and had lent it to the accused. No scrap of paper is produced to probabalise this contention. Admittedly, the complainant is not an Income Tax Assessee. 9. When the accused has taken a specific defence and cross-examined PW1, the same gives rise to serious doubt on the credibility of the complainant. The accused has stepped into the witness box and deposed as DW1, speaking about his defence. Under such circumstances, presumption under Section 139 of NI Act stands rebutted. Once presumption is rebutted, reverse burden lies on the complainant to establish his contention regarding lending of amount, existence of legally recoverable debt, issuance of legally recoverable debt without

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NC: 2024:KHC:33063 CRL.A No. 16 of 2013

the help of presumption under Section 139 of NI Act. The evidence on record discloses that accused was successful in rebutting the legal presumption and therefore it is for the complainant to prove lending of the amount and existence of legally recoverable debt. Then only he can succeed in seeking conviction of the accused for the offence punishable under Section 138 of NI Act. When the complainant is not successful in proving his contention regarding lending of the amount and existence of legally recoverable debt, it cannot be said that the complainant is successful in proving the guilt of the accused beyond reasonable doubt. 10. In the present case, evidence of the complainant as PW1 and evidence of accused as DW1 disclose that the complainant is not successful in discharging his burden of lending the amount. When the accused is successful in discharging his burden and probabalising his defence of issuing blank cheque with his signature in favour of one Ramdas, under such circumstances, accused is entitled for acquittal. 11. I have gone through the impugned judgment passed by the trial Court acquitting the accused. The trial Court

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NC: 2024:KHC:33063 CRL.A No. 16 of 2013

has taken into consideration oral and documentary evidence placed on record and has arrived at a right conclusion. I do not find any perversity or illegality in the said judgment. Hence, I answer the above point in the negative and proceed to pass the following: ORDER

Appeal is dismissed.

Sd/- (M G UMA) JUDGE

BH List No.: 2 Sl No.: 20