Allowed

Suresh v. Pujari v Sidduraju K. J.

Karnataka HC15 Dec 2020CRL.A/2730/2011

Case brief

AI extract

What is this about?

Complainant's appeal against acquittal in a prosecution under Section 138 of the Negotiable Instruments Act over a dishonoured cheque. The court held that the trial court wrongly placed the burden on the complainant, that the accused had failed to rebut the presumption under Section 139, and set aside the acquittal, convicting and sentencing the accused to fine.

What did the court decide?

Appeal allowed; judgment of acquittal dated 19.05.2011 set aside and reversed; respondent convicted and sentenced to pay a fine of Rs.4,50,000, with Rs.4,45,000 payable to the appellant as compensatio

Suresh v. Pujari Vs Sidduraju K. J. — Cheque Dishonour | Karnataka HC (2020)

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IN THE HIGH COURT OF KARNATAKA DHARWAD BENCH

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DATED THIS THE 15^TH DAY OF DECEMBER 2020

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BEFORE

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THE HON’BLE MR. JUSTICE PRADEEP SINGH YERUR VISHAL NPATTIHAL CRIMINAL APPEAL NO.2730/2011Digitallysigned byVISHAL NPATTIHALDate:2020.12.2215:58:43+0530

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BETWEEN :

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SURESH V.PUJARI, AGE : 52 YEARS, OCC : BUSINESS, R/O.PUJARI PICTURES, GOAN TOWER BUILDING, NEAR NEHRU STADIUM, HUBLI.

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…APPELLANT (BY SRI MAHESH WODEYAR, ADVOCATE)

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AND :

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SIDDURAJU K.J., AGE : MAJOR, OCC : BUSINESS, R/O.SRS PICTURES, NEAR SHREE NAGAR, CINEMA THEATRE, STATION ROAD, HUBLI.

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…..RESPONDENT (BY SRI A.M.GUNDAWADE, ADVOCATE) THIS APPEAL IS FILED UNDER SECTION 378 OF CR.P.C. AND PRAYED TO SET ASIDE THE JUDGMENT AND ORDER OF ACQUITTAL DATED 19.05.2011 PASSED BY THE III ADDITIONAL CIVIL JUDGE AND J.M.F.C., HUBLI IN C.C.NO.1770/2008 AND CONSEQUENTLY CONVICT THE RESPONDENT/ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF THE N.I.ACT.

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THIS APPEAL COMING ON FOR HEARING THIS DAY, THE COURT DELIVERED THE FOLLOWING:

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JUDGMENT

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This appeal is preferred by complainant against the Judgment of acquittal passed by III Additional Civil Judge and J.M.F.C., Hubballi in C.C.No.1770/2008 dated 19.05.2011.

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Brief facts leading to filing of this appeal are as under:

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It is the case of appellant that appellant was engaged in the business of film distribution in the name of Pujari Pictures at Hubballi. Accused is also engaged in the same line of business and he is an exhibitor of films. Since both are in the same line of business. They have a long standing business relationship with each other. Accused had taken a film by name “Circle Rowdy” a Kannada movie from the complainant for exhibition, towards this transaction respondent was liable to pay a sum of Rs.2,25,000/- to appellant. In order to discharge the said liability, respondent issued a cheque bearing

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No.187167 dated 16.04.2008 for Rs.2,25,000/- in favour of appellant.

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On presentation of the said cheque to the Bank, same came to be dishonored for the reason “funds insufficient” and appellant received the said information vide memo date 19.04.2008. Pursuant to which, appellant got issued a legal notice on 28.04.2008 calling upon the respondent to make payment of the dishonoured cheque amount within 15 days from the date of receipt of the said notice. The legal notice came to be served on respondent on 29.04.2008. On 09.05.2008, respondent replied to the notice denying the claim made by appellant herein. Since the dishonoured cheque amount was not paid by respondent, appellant filed a complainant under Section 200 of Cr.P.C. for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short ‘N.I.Act’) against the respondent. On cognizance being taken by the learned Magistrate, respondent was summoned before the Court and enlarged on bail, thereafter, plea of the respondent was recorded, where

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he pleaded not guilty and claimed to be tried, accordingly he was tried. In order to prove the case, complainant got examined himself as P.W.1 and got marked Exs.P.1 to 10 and closed his side. Thereafter, the statement of respondent/accused was recorded under Section 313 of Cr.P.C., where respondent denied all the incriminating evidence against him. Respondent examined himself as D.W.1 and got marked Exs.D.1 to 4 in support of his case.

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After going through the entire material evidence, both ocular or documentary, trial Court came to a conclusion that the appellant has not produced any document to show that there existed any agreement between himself and respondent and that appellant failed to prove the fact that accused person had obtained the film “Circle Rowdy” for exhibition from him. Further, the trial Court came to a conclusion that no transaction had taken place between the appellant and respondent with regard to distribution and exhibition of film namely “Circle Rowdy” and hence, respondent has succeeded in rebutting the presumption cast in favour of

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appellant and therefore non-production of material to show that there was any agreement or transaction between appellant and respondent is fatal and same has not been proved by appellant as the onus shifted on him. Accordingly, trial Court acquitted the accused.

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Aggrieved by the said judgment of acquittal, appellant/complainant is before this Court challenging the correctness, legality and propriety of the judgment of trial Court.

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Heard Sri.Mahesh Wodeyar learned counsel for appellant and Sri.A.M.Gundawade, learned counsel for respondent.

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It is contended by learned counsel for appellant that the judgment of acquittal passed by trial Court is contrary to the material evidence and law and hence the same is arbitrary and deserves to be set aside and reversed. He further contends that the judgment of acquittal is without application of mind and without properly appreciating the evidence on record. Hence, the same deserves to be set aside and reversed. Learned

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counsel further contends that the findings recorded by appellate Court is illegal, erroneous, perverse and arbitrary, the same is not in accordance with law and well established principles laid down by the Hon’ble Apex Court and this Court in several catena of decisions. Hence, the same requires to be set aside and reversed. Learned counsel further contends that the trial Court has misdirected itself in understanding the provision of Sections 138 and 139 of N.I.Act and the order of acquittal has resulted in grave miscarriage of justice to the appellant herein.

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Further, the learned counsel contends that the trial Court has failed to consider the fact that respondent has admitted the issuance of cheque and signature on the cheque, despite which the trial Court has passed the impugned order of acquittal causing miscarriage of justice to the appellant. He further contends that the trial Court has failed to appreciate the Ex.D.1, which is ‘B’ report filed on the complaint initiated by respondent against the appellant herein in respect of very same cheque, which is in dispute herein. Thereby, the

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impugned order passed by trial Court is erroneous on facts and on law. Learned counsel further contends that the trial Court has failed to apply the provision of Section 139 of the N.I.Act which is a presumption in law in favour of appellant and by ignoring the same, the impugned order is arbitrary and erroneous. He further contends that the Judgment of acquittal and reasons provided in the findings of trial Court suffers from serious legal infirmities. The trial court has misdirected itself and has gone on a tangent to lay the onus and burden of proof on the appellant rather than on the respondent as contemplated under the statute.

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Learned counsel further contends that the trial Court has failed to appreciate the evidence and the materials produced on record, thereby has committed serious error in passing the impugned order of acquittal. He further contends that there is no application of mind by trial Court in coming to a conclusion that respondent has rebutted the presumption cast in favour of appellant, whereas there is nothing on record to show that respondent has placed any such material to rebut

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the presumption in favour of appellant. Therefore, viewed from any angle, the Judgment of acquittal passed by trial Court is illegal, perverse, arbitrary and suffers from legal infirmities and hence, the same deserves to be set aside and reversed. On these submissions, he seeks to allow the appeal and set aside the Judgment of acquittal and consequently, convict the respondent for the offence punishable under Section 138 of the N.I.Act.

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Learned counsel places reliance on the following judgments in support of his contentions:

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(1) APS Forex Services Pvt. Ltd. Vs. Shakti International Fashion Linkers & Others, reported in AIR 2020 SC 945.

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(2) Bir Singh Vs. Mukesh Kumar, reported in AIR 2019 SC 2446.

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(3) T.Vasanthakumar Vs. Vijayakumari, reported in (2015) 8 SCC 378.

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Per Contra , learned counsel for respondent contends that the Judgment of acquittal passed by trial Court is on the basis of evidence adduced by parties and

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material documents placed before the Court and the same is in accordance with law and hence, no interference is called for by this Court. Learned counsel further contends that it is the appellant who was approached the Court and while doing so burden of proof lies on the appellant to prove before the Court the existence of legally recoverable subsisting debt or liability. He contends that in the present case, appellant has not produced any material to show the existence of transaction so alleged in the complaint. He further contends that though appellant claims that the film was sold to respondent for exhibition and the same was exhibited by respondent, no material has been placed before the Court to show any agreement made between appellant and respondent and since the appellant has not produced any such material to show about the existence of a transaction of selling the film for exhibition, the trial Court has rightfully come to a conclusion that appellant has failed to prove the legal requirement under Section 138 of the N.I.Act and has rightfully acquitted the respondent/accused.

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Learned counsel for the respondent further contends that though the appellant claims that he is the proprietor of Pujari Pictures, in the cross-examination, he has admitted that his wife Smt.Rathna Suresh Pujari is the one who has obtained rights for distribution of film ‘Circle Rowdy’ but the appellant has not adduced evidence of Smt.Rathna Suresh Pujari in support of his case. It is also contended by the learned counsel that no document is produced to show whether Smt.Rathna Suresh Pujari has given the rights of exhibition of film to the respondent. Hence, non production of this material document is fatal to the case of the complainant which further fortifies that the appellant has failed to establish the case of existence of legally recoverable debt.

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Learned counsel further contends that two cheques were handed over to the appellant as security for the loan which was paid by him. Since the appellant did not pay the loan amount of Rs.25,000/- as agreed, the appellant ought to have returned two cheques and the bond paper which was obtained from the

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respondent. Learned counsel further contends that this fact of the matter has been stated by the respondent in his letter- Ex.D3 dated 24.04.2008. Therefore, he contends that immediately on coming to know about the dishonour of cheque-Ex.P1 on 19.04.2008, he has immediately got issued a letter on 24.04.2008 taking a plea that there was no transaction as alleged by the appellant and that he has not issued Ex.P1 towards any legally recoverable debt and hence, in the said letter, he asked for return of two cheques along with blank signed bond paper. Therefore, the learned counsel contends that as on 24.04.2008, he has taken the defence of non existence of any legally recoverable debt, despite which, the appellant has proceeded to file the present complaint and the same has rightly ended up in the acquittal of the respondent.

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Learned counsel further contends that the trial Court considering the materials on record and the evidence of both the parties and on proper application of mind has passed the order of acquittal, which does not

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deserve to be reversed or interfered. On this submission, the learned counsel seeks to dismiss the appeal and to confirm the order of acquittal.

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Having heard the learned counsel appearing for both the parties, the points that arise for consideration before this Court are:

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“i) Whether the respondent has rebutted the presumption under Section 139 of the Negotiable Instruments Act in favour of the appellant?

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ii) Whether the judgment of acquittal is just and proper and deserves to be set aside?”

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While answering the above points, it is necessary to have a cursory look at the facts of the case and material placed before the Court. It is not in dispute that the appellant and the respondents are known to each other as they were involved in the same line of business of film distribution and exhibition and hence, they have developed good business relationship. It is also not in dispute that the respondent has issued a signed cheque bearing No.187167 dated 16.04.2008. No

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doubt, it is the contention of the respondent that the said cheque was issued as security for the loan amount of Rs.25,000/- which was to be disbursed by the appellant. However, neither the respondent has produced any material before the Court to show that the alleged loan was sought from the appellant nor it has been elicited in the cross-examination of PW.1 with regard to the existence of such loan of Rs.25,000/-.

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On presentation of Ex.P1 to the Bank, the same came to be dishonoured with an endorsement as “funds insufficient” vide a memo dated 19.04.2008 which is produced as Ex.P3 and immediately thereafter, the appellant has issued a legal notice to the respondent vide Ex.P4 dated 28.04.2008.

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In the meanwhile, the respondent has issued a letter dated 24.04.2008 as per Ex.D3 which is issued immediately after the dishnour of Ex.P1 and prior to the legal notice issued to the respondent in which the respondent has contended that there is no existence of any business transaction as alleged by the appellant and

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that the respondent had issued two cheques along with a blank signed bond paper for a sum of Rs.100/- to the appellant towards payment of loan amount of Rs.25,000/-. Since the said loan amount has not been paid as promised by the appellant, the respondent sought for return of two cheques along with a blank signed bond paper for a sum of Rs.100/-. Ex.D3 and the contents therein are the primary defence taken by the respondent to rebut the contentions of the appellant and also the presumption in favour of the appellant as contemplated under Section 139 of the N.I.Act. On the basis of the materials, the parties have adduced their evidence to prove their case. PW.1, who is none other than the complainant has stepped into the witness box and he has deposed stating that he is a distributor of film and the respondent is a exhibitor of film. With an intention to exhibit the film namely, ‘Circle Rowdy’, he entered into the transaction with the appellant in the name of SRS which was run by the respondent and in pursuance of the said intention, he has also paid an advance amount of Rs.25,000/- by way of cash on the

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agreement that he would pay the balance amount of Rs.2,25,000/- towards exhibition of the above said film to the appellant, for which the respondent got issued Ex.P1 for a sum of Rs.2,25,000/- in favour of the appellant.

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In the cross-examination of PW.1, respondent has made valiant efforts to elicit information with regard to there being no legally subsisting and recoverable debt or for that matter existence of any transaction between appellant and respondent. No doubt in crossexamination appellant has admitted that it is lady Rathna Suresh Pujari who owned rights of distribution of movie ‘Circle Rowdy’. He has further stated, he is proprietor of Pujari Pictures.

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He has further admitted that Smt.Rathna Suresh Pujari has given rights to Pujari Pictures. Apart from this, there is no other worthwhile evidence elicited in cross-examination by respondent. All other questions and suggestions have been denied by PW.1 in crossexamination.

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In order to substantiate his case, respondent has got examined himself as DW.1 and he has got marked Exs.D.1 to D.4. In his evidence he has stated that appellant is not proprietor of Pujari Pictures and that no transaction has taken place between himself and appellant with regard to distribution and exhibition of movie namely ‘Circle Rowdy’. He has further stated in his evidence that he has not issued Ex.P.1 towards any legally recoverable debt or liability. It is his specific case that this cheque along with another cheque and a blank signed bond paper of Rs.100/- was handed over to appellant only with an intention of giving these documents as security for securing loan of Rs.25,000/from appellant. Since appellant did not pay promised loan amount of Rs.25,000/-, respondent sought for return of two cheques and blank signed bond paper from appellant vide letter dated 24.4.2008 as per Ex.D.3. It is also stated in evidence of PW.1 that since there was no authority for appellant to enter into a transaction as his wife Smt.Rathna Suresh Pujari was a person who had rights of distribution, there was no need and

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requirement for respondent to deal with appellant herein or part with any cheque towards exhibition of movie. Therefore he has stated that entire story made out by appellant is frivolous and concocted. It is further stated that appellant has not produced any material to show that he is the distributor of movie ‘Circle Rowdy’.

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Respondent has also deposed in his evidence that as soon as he came to know about dishonour of Ex.P.1, he has immediately got issued a notice asking for return of blank signed cheques which were given as security. It is also deposed by PW.1 that in view of two cheques being taken towards security and loan amount having been not paid, the same were illegally retained by appellant due to which respondent filed a criminal case against appellant in Crime No.318/2008 for the offence punishable under section 420 and 511 of IPC. It is to be noted that this proceedings ended up by the police filing ‘B’ summary report which is produced at Ex.D.1. However in cross-examination of respondent DW.1, there is a clear admission with regard to issuance of cheque in favour of appellant and signature on

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cheque is also admitted by respondent. However respondent has denied transaction between himself and appellant.

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This being the material evidence adduced by both parties, along with documents produced, it is important for this Court to note whether appellant has made out a ground to attract the provisions of section 138 of the N.I. Act and if so, whether respondent/accused has rebutted presumption under Section 139 of the N.I. Act.

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In view of the above, it is necessary to extract section 138 of the N.I.Act, which reads as under:

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Dishonour of cheque for insufficiency, etc., of funds in the accounts

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Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing

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to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both:

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PROVIDED that nothing contained in this section shall apply unless—

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(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier;

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(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice, in writing, to the drawer of the cheque, within thirty days of the receipt of information by him from the bank

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regarding the return of the cheque as unpaid; and

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(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.

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Explanation: For the purposes of this section, “debt of other liability” means a legally enforceable debt or other liability.

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On cognizance being taken for the offence punishable under section 138 of the N.I. Act, the offence is technically made out. Thereafter presumption in law comes into play in favour of appellant under section 139 of the N.I. Act. On a bare reading of section 139 of the N.I. Act, it is seen that whether payee or holder of a cheque receives the cheque, when the same is received towards discharge of in whole or in part of any debt or other liability. So, under this provision receipt of cheque by appellant from respondent is never to prove the fact that the same has been issued towards discharge of in

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whole or in part of any debt or liability. In the present case respondent has admitted cheque and signature on cheque. Therefore first part of provision of presumption in favour of appellant is made out by appellant in the present case.

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No doubt presumption under section 139 of the N.I. Act is a presumption in law. But the same is a rebuttable presumption. If respondent/accused is able to rebut the said presumption, and prove to the contrary that there did not exist, and does not exist any legally recoverable debt, then, on such rebuttal the onus will shift on complainant to satisfy the said rebuttal to prove his case. Therefore it is only after respondent/accused rebuts the presumption, onus will shift to appellant to satisfy such rebuttal.

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Rebuttal of presumption is not mere denial or suggestions in cross-examination or by production of certain materials. In order to rebut the presumption, respondent will have to do something more than just mere denials. There has to be cogent evidence either

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oral or documentary which can disprove the case of appellant and show to the satisfaction of the Court that there never existed any transaction, or an legally recoverable subsisting debt or liability.

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In the present case on hand respondent having admitted issuance of cheque and cheque will have to show that there never existed very transaction as claimed by appellant. Let us see whether respondent has been able to show before this Court either by oral evidence or by documentary evidence that there never existed any transaction towards which the cheque Ex.P.1 was issued.

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It is not in dispute that appellant and respondent are well known to each other. It is also not in dispute that appellant and respondent are in the same line of business i.e., film distribution and exhibition. It is also not in dispute that there has been several transactions between appellant and respondent where respondent has purchased film from appellant. It is also not in dispute that respondent has exhibited the film

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namely ‘Circle Rowdy’ which is produced before this Court as per Exs.P.8, P.9 and P.10 which shows that this film was exhibited in the name of SRS Pictures, Huballi. Therefore it cannot be denied by respondent that this picture namely ‘Circle Rowdy’ has been exhibited by respondent in the area and region of Bombay Karnataka. It is also not in dispute that appellant is sole distributor of film ‘Circle Rowdy’ for the area of Bombay Karnataka. It is also not in dispute that respondent is only an exhibitor and he has not shown before this Court as to from whom and how he procured film for exhibition in the above said region of Karnataka and Bombay. Hence it is apparent on the face of record that the said film has been exhibited in the region where appellant is sole distributor.

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Now coming to the aspect of issuance of cheque Ex.P.1 in favour of appellant, no doubt respondent has taken the defence that this cheque along with another cheque was issued as security to obtain loan amount of Rs.25,000/- from appellant. It is also the case of respondent that alleged promised loan amount

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was not disbursed by appellant. It is hard to believe that respondent would have parted with two cheques and blank signed bond of Rs.100/- without receiving the loan amount of Rs.25,000/-. It is further stated by respondent that alleged loan amount was not given by appellant. Therefore the theory put forth by respondent for issuance of two cheques and a signed bond paper of Rs.100/to appellant towards loan amount of Rs.25,000/- is unbelievable and same is not sustainable. Nevertheless respondent has not produced any material or any evidence before the Court to substantiate the claim with regard to loan amount and issuance of these two cheques as security.

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In view of appellant having presented the cheque Ex.P.1 to the bank, the same having been dishonoured, a legal notice was sent to respondent and since no amount was paid, a complaint came to be filed. Technically there is no fault on presentation by appellant.

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On fulfillment of mandatory requirement under proviso (a) to (c) of section 138 of the N.I.Act, the offence is made out. On cognizance being taken, presumption under section 139 of the N.I.Act comes into play in favour of appellant and against respondent having admitted issuance of cheque and signature on the cheque, burden is now on respondent to rebut the said presumption which is in favour of appellant. Therefore section 138 of the N.I. Act is a reverse burden and it is for respondent to raise a probable defence and which should establish by way of preponderance of probability. It is not by merely suggesting questions and mere denials with regard to existence of a debt or liability would establish rebuttal of presumption. In the present case on hand the trial Court has totally misdirected itself.

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In the case on hand, the trial Court totally misdirected itself by holding that it is for the appellant to prove the existence of legally recoverable debt and that it was for the appellant to prove the existence of agreement between himself and respondent and

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therefore, non-production of agreement, as alleged, disprove the case of the appellant and thereby appellant has failed to prove the fact that respondent had obtained the rights of exhibition of film ‘Circle Rowdy’ in the specific area of Karnataka and Bombay and since there is no agreement produced complainant has failed to prove the guilt of the accused – respondent herein. In my opinion, the said proposition of law is against the provisions of Section 139 of the N.I. Act and the intent of Legislature in making the said law and the same is also against the principles and ratio laid down by the Hon’ble Apex Court in several catena of judgments.

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In this view of the matter, it is relevant to extract Section 118 (a) & (g) of the N.I. Act, which reads as follows:

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“118. Presumption as to negotiable instruments.- Until the contrary is proved, the following presumptions shall be made:

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(a) of consideration: that every negotiable instrument was made or drawn for consideration, and that every such

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instrument when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration; &

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(g) that holder is a holder in due course: that the holder of a negotiable instrument is a holder in due course:”

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Provided that, where the instrument has been obtained from its lawful owner, or from any person in lawful custody thereof, by means of an offence or fraud or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him.:

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On bare understanding of the above provisions, it is seen that ‘every negotiable instrument is made and drawn for consideration and that every such instrument when it has been accepted, indorsed, negotiated or transferred for consideration’. Further, ‘holder of a negotiable instrument is a holder in due course’. It is necessary to extract Section 20 of the N.I. Act, which reads thus:

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“Inchoate stamped instruments.- Where

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one person signs and delivers to another a

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paper stamped in accordance with the law relating to negotiable instruments then in force in [India] and either wholly blank or having written thereon an incomplete negotiable instrument, he thereby gives prima facie authority to the holder thereof to make or complete, as the case may be, upon it a negotiable instrument, for any amount specified therein and not exceeding the amount covered by the stamp. The person so signing shall be liable upon such instrument, in the capacity in which he signed the same, to any holder in due course for such amount:

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Provided that no person other than a holder in due course shall recover from the person delivering the instrument anything in excess of the amount intended by him to be paid thereunder.”

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On careful understanding of the above provisions, it is seen that any negotiable instrument is signed and handed over either to payee or holder in due course, when the person handed over the said cheque, prima facie, gives authority to holder of the cheque to

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make or complete as the same may be upon the negotiable instrument and the person who is filling the said negotiable instrument shall be liable towards the said instrument.

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Therefore, in the present case it is not disputed by the respondent that he handed over the cheque to the appellant, though it is stated that it is for security, the same is not substantiated. Hence, it can be presumed that the said instrument was given for consideration towards existing legally recoverable debt. The legally recoverable debt in the present case clearly without doubt for exhibition of film ‘Circle Rowdy’, which has been exhibited in the Karnataka and Bombay region, for which appellant is the sold distributor as per Ex.P8, 9 and 10. Therefore, it does not lie in the mouth of the respondent now to say, it is for the appellant to prove beyond reasonable doubt with regard to existence of transaction or agreement towards exhibition and distribution of the film.

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Issuance of cheque itself is proof of transaction unless the same is proved to the contrary by the respondent which would act as rebuttable presumption as provided under Section 139 of the N.I. Act. Therefore, the finding and conclusion of the trial Court that it is for the appellant to prove the existence of legally recoverable debt and the existence of any agreement between the appellant and respondent, is prima facie illegal, perverse and contrary to the enactment and the law laid down by the Hon’ble Apex Court.

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The other aspect that whether Smt.Rathna Suresh Pujari, who is the Proprietor of Pujari Pictures, has owned the rights for distribution of ‘Circle Rowdy’, would not help respondent in any manner, nor does it make any difference to the appellant as the cheque – Ex.P1 is issued in the name of the appellant – Suresh V. Pujari. Therefore, I answer point No.1 in the negative as respondent has failed to rebut the presumption as contemplated under Section 139 of the N.I. Act in favour of the appellant.

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The trial Court has totally misdirected itself in considering Section 139 of the N.I. Act, which is the presumption in law, which acts in favour of the appellant unless contrary is proved by the respondent. In the present case on hand, I do not find any material to show rebuttal of presumption by respondent. Therefore, I am of the opinion, that the judgment of acquittal passed by the trial Court is illegal and perverse and the same deserves to be set aside and reversed. Accordingly, I pass the following order:

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ORDER

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(1) Appeal is allowed.;

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(2) Judgment of acquittal passed by the III Additional Civil Judge and J.M.F.C., Hubballi in C.C.No.1770/2008 dated 19.05.2011, is hereby set aside and reversed.;

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(3) The respondent – accused is sentenced to pay a fine of double the cheque amount (cheque amount being Rs.2,25,000/-)in a sum of

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Rs.4,50,000/- (Rupees four lakh fifty thousand only).

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(4) In default to pay the fine amount, the respondent – accused shall undergo simple imprisonment for a period of six months for the offence punishable under Section 138 of the N.I. Act.;

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(5) Out of the fine amount deposited by the respondent – accused, a sum of Rs.5,000/(Rupees five thousand only) shall be remitted to the account of the State.;

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(6) Balance amount of Rs.4,45,000/- (Rupees Four Lakh Forty five thousand only), shall be paid to the appellant – Complainant as compensation.

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Sd/JUDGE

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CKK/LB/MRK/VK

Suresh v. Pujari v Sidduraju K. J.

Case brief

What is this about?

What did the court decide?

Suresh v. Pujari v Sidduraju K. J.

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