Dismissed

Smt. Parvathi W/O Eshwarayya Jadimath, v. Eranna S/O Sannakallayya Anti

Karnataka HC1 Dec 2020CRL.A/2846/2011

Case brief

AI extract

What is this about?

High Court dismissed the appeal against acquittal in a cheque dishonour case. The court held that the appellant failed to prove a legally recoverable debt due to inconsistencies in the legal notices regarding the cheque date and a lack of cogent material to substantiate the loan claims.

What did the court decide?

Appeal dismissed; judgment of acquittal of the respondent confirmed.

Smt. Parvathi W/O Eshwarayya Jadimath, Vs Eranna S/O… — Cheque Dishonour | Karnataka HC (2020)

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IN THE HIGH COURT OF KARNATAKA DHARWAD BENCH

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DATED THIS THE 01^ST DAY OF DECEMBER 2020

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BEFORE

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VISHAL NPATTIHAL THE HON’BLE MR. JUSTICE PRADEEP SINGH YERUR

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CRIMINAL APPEAL NO.2846/2011Digitallysigned byVISHAL NPATTIHALDate:2020.12.2215:55:21+0530

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BETWEEN:

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SMT. PARVATHI W/O: ESHWARAYYA JADIMATH, AGE: 45 YEARS OCC: HOUSEHOLD, R/O: ITAGI, TQ: YELBURGA, DIST: KOPPAL. …..APPELLANT (SRI SABEEL AHAMED, ADV. FOR SRI A.S.PATIL, ADVOCATE) AND ERANNA S/O: SANNAKALLAYYA ANTI, AGE: 49 YEARS, OCC: BUSINESS, POST: MAHAMAYI TEMPLE ROAD, KUKANOOR, TQ: YALABURGA, DIST: KOPPAL. ……RESPONDENT (SRI NEELENDRA D.GUNDE, ADVOCATE)

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THIS APPEAL IS FILED UNDER SECTION 378 OF Cr.P.C. PRAYING TO SET ASIDE THAT THE IMPUGNED JUDGMENT AND ORDER OF ACQUITTAL PASSED BY THE

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CIVIL JUDGE AND JMFC, KOPPAL DATED 05.03.2011 IN C.C.NO.443/2009.

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THIS APPEAL COMING ON FOR FINAL 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 the Court of Civil Judge & JMFC, Koppal in C.C.No.443/2009 dated 05.03.2011.

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Brief facts leading to the filing of this appeal are as under;

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It is the case of appellant that he is acquainted with respondent and they are well known to each other. As the respondent was in need of financial help, appellant gave hand loan of Rs.1,75,000/- to respondent. Appellant had received this amount as death benefits of her husband. At the time of giving hand loan, respondent executed an on-demand promissory note in favour of appellant. When appellant

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demanded repayment of loan amount, respondent kept delaying and failed to make the payment. Hence, appellant got issued a legal notice to respondent on 29.04.2009. Thereafter, respondent paid a sum of Rs.25,000/- in cash to appellant and for balance amount of Rs.1,50,000/- got issued a cheque in favour of appellant dated 12.05.2009.

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On presentation of the cheque to bank, the said cheque came to be dishonored for the reasons “Insufficient Funds”. In view of dishonor of the cheque, complainant got issued a legal notice on 26.05.2009, demanding the respondent to repay the dishonored cheque amount and since no amount was paid by respondent, appellant was forced to file a complaint against the respondent for the offence punishable under Section 138 of Negotiable Instruments Act (for short “N.I.Act”).

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On cognizance being taken by the trial Court, respondent was summoned and his plea was recorded where he pleaded not guilty and claimed to be tried.

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In order to prove her case, complainant got examined herself as PW.1 and got marked Ex.P.1 to Ex.P.11 and closed her side. Thereafter, the statement of respondent was recorded under Section 313 of Code of Criminal Procedure, wherein respondent denied all the incriminating evidence against him. Respondent adduced defence evidence by examining himself as DW.1 and got marked Ex.D1 to D4.

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After going through the material evidence both oral and documentary, trial Court came to the conclusion that appellant has not made out the necessary ingredients as contemplated under Section 138 of N.I.Act and that appellant has miserably failed to prove that she had lent a sum of Rs.1,75,000/- to respondent and so also

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failed to prove that respondent had issued Ex.P1-cheque and therefore acquitted the accused for the offence punishable under Section 138 of N.I.Act. Aggrieved by the judgment of acquittal passed by the trial Court, the appellant-complainant is before this Court challenging the legality and correctness of judgment of acquittal passed by the trial Court.

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Heard Sri Sabeel Ahmed, learned counsel for the appellant and Sri Neelendra D.Gunde, learned counsel for the respondent.

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It is contended by the learned counsel for the appellant that the judgment of acquittal passed by the trial Court is contrary to the facts and circumstances of the case and material available on record and hence the same requires to be set aside. He further contends that the learned Magistrate has not appreciated the evidence on record and passed the impugned judgment contrary to the evidence recorded by

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the parties. He further contends that the trial Court has committed an error in not accepting the signature at Ex.P1 to be that of respondent and it is not within the purview of the trial Court to verify and compare the signature by itself as the Court ought to have referred the matter to an expert to obtain an opinion with regard to the correctness or otherwise of the signature. Hence, comparing of the signature by the Court itself is erroneous in law and hence the judgment of acquittal is not sustainable and the same deserves to be reversed.

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Learned counsel for the appellant further contends that the trial Court has committed an error in not appreciating the fact that appellant was getting income out of tailoring business conducted by her and also she had secured the amount of Rs.1,75,000/- from out of the death benefits of her husband. Thereby, she had sufficient source of income and capacity to make the payment of loan to respondent. This fact of

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the matter has been ignored and overlooked by the learned Magistrate thereby causing miscarriage of justice to appellant.

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Learned counsel further contends that the trial Court has erred in drawing adverse inference against the appellant by holding that non production of bank pass book and the documents pertaining to the insurance and other death benefits and promissory note, is fatal to the case of the appellant. Learned counsel further contends that there is presumption in law in favour of the appellant/complainant under Section 139 of NI Act, which has been over looked and conveniently ignored by the learned Magistrate. Therefore, acquittal of respondent based on drawing adverse inference is not sustainable in law and hence the same deserves to be set aside and reversed. Learned counsel further contends that the burden of proof has been cast on the appellant rather than the respondent, in view of presumption which is in

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favour of the appellant. This position of law has been not appreciated and ignored by the learned Magistrate. Hence, the judgment of acquittal is erroneous in law. On these submissions learned counsel for appellant seeks to allow the appeal and consequently set aside and reverse the judgment of acquittal passed by the trial Court.

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Per contra, learned counsel for respondent has vehemently contended that the judgment of acquittal passed by the trial Court on the basis of the material evidence both oral and documentary placed on record by the parties and hence it is a well reasoned judgment of acquittal, which does not call for any interference by this Court.

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Learned counsel further contends that there has been no transaction between the appellant and respondent and a false case has been foisted by appellant to make quick and fast money. Learned counsel further contends that

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entire case of the appellant is an imaginary and concocted story and the date stated with regard to cheque at Ex.P1 and the contents in the legal notice issued are contrary to the evidence led by the appellant. This aspect of the matter has been analyzed and appreciated by the learned Magistrate and has rightfully come to a conclusion that appellant has not made out any offence to attract Section 138 of NI Act and therefore, rightly acquitted the respondent. He contends that there is no illegality or perversity or any error in law or on facts of the case to call for any interference by this Court.

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Learned counsel further contends that the theory put forth by appellant with regard to promissory note having been executed by respondent subsequent to loan amount being received by the respondent, has not been produced neither photo copy was produced before Court to substantiate the claim of

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existence of legally recoverable debt. Learned

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counsel contends that when there is no existence of legally recoverable debt or other liability, the burden shifts on appellant to prove that there exists legally recoverable subsisting debt.

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In the facts and circumstances of the present case, appellant has miserably failed to prove the existence of legally recoverable debt. Therefore, the impugned order of acquittal is based on the facts and the existing position of law and the trial Court has rightfully acquitted the respondent, which does not call for interference.

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Learned counsel further contends that right from the reply notice issued on 05.11.2009, which is at Ex.P10 issued in reply to the notice at Ex.P4, got issued by the appellant demanding payment of promissory note, respondent totally denied existence of any loan and any transaction between the parties. Learned counsel contends

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that it is the case of appellant that on 02.05.2009 Ex.P1 came to be issued in favour of respondent by appellant, whereas in cross examination of PW1 it is clearly admitted that Ex.P1 got issued by the respondent on 12.05.2009. Further, learned counsel contends that on clear admission by the appellant with regard to issuance of cheque on 12.05.2009 is contrary to the material placed on record, including Ex.P1 and complaint and also evidence of PW1. Therefore, the theory put forward by the appellant is contrary to his own statement, which has been appreciated by the learned Magistrate and has rightfully acquitted the respondent. On these grounds he seeks dismissal of the appeal and to confirm the judgment of acquittal passed by the trial Court.

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Having heard the learned counsel for appellant and the learned counsel for respondent

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the point that arises for consideration before this Court are:

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“Whether there is any illegality or perversity in the judgment of acquittal passed by the trial Court?

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To answer these points it is necessary to have a cursory look at the facts of the case. It is specific case of the appellant that she had advanced a loan amount of Rs.1,75,000/- to respondent and in turn respondent has issued an on-demand promissory note in her favour. On appellant issuing a legal notice as per Ex.P4 dated 29.04.2009 demanding respondent to repay the loan amount as prescribed in promissory note, respondent got issued a cheque on 02.05.2009 by indorsing a post date on the cheque as 12.05.2009. Since the said cheque came to be dishonoured on presentation, appellant has issued legal notice as per Ex.P9, in which she has clearly stated that the cheque was issued on 02.05.2009 and in turn she returned

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the promissory note. Respondent has replied to both these legal notices at Ex.P4 and P9, vide Ex.P10 and P11 respectively. It is interesting to note that in the first reply notice to the demand of promissory note amount, respondent has denied the existence of any transaction of loan as alleged by the appellant. Despite the said denial of the respondent of any transaction, it is strange to note that another legal notice is issued by the appellant as per Ex.P9 stating that cheque has been issued on 02.05.2009 by mentioning post date as 12.05.2009 on the cheque at Ex.P1.

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It is not in dispute that the relationship of appellant and respondent was cordial and they were well acquainted with each other but the transactions having been denied by respondent with regard to existence of any legally recoverable debt, promissory note and issuance of Ex.P1. It is to be seen whether appellant has been able to make out necessary ingredients as

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required under Section 138 of NI Act. In view of the above, it is necessary to extract proviso (a) to (c) of Section 138 of NI Act, which reads thus:

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“DISHONOUR OF CHEQUE FOR INSUFFICIENCY, ETC., OF FUNDS IN THE ACCOUNT. —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 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 19 [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: 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, 20 [within thirty days] of the receipt of information by him from the bank 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 or other liability” means a legally enforceable debt or other liability.”

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There is no dispute with regard to presentation of cheque within the time period and that the cheque is drawn by the payee and demand for payment of amount as per Ex.P9. It is also not in dispute that the said amount was demanded as per legal notice but has not been repaid and accordingly, complaint has been presented before the Court. On presentation of the complaint before the Court cognizance was

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taken, accused was summoned, who pleaded not guilty and has denied all the incriminating evidence in the statement recorded under Section 313 Cr.P.C. It is no doubt that under Section 139 of Cr.P.C. there is presumption in favour of the appellant, the same is rebuttable presumption. If the respondent is able to rebut the presumption and prove to the contrary that there does not exist a legally recoverable debt or liability, then the burden shifts to appellant to satisfy the said rebuttal of the respondent. It is important to see whether respondent has rebutted presumption in favour of appellant.

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On going through the evidence of PW1 – Complainant, after perusal of the contents of legal notice Ex.P4 and P9 and complaint averments also states with regard to issuance of cheque on 02.05.2009 by showing cheque as 12.05.2009, whereas in the cross examination of PW1, she categorically admits that the cheque has been given on 12.05.2009, which is contrary

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to the statement made by her right from issuance of legal notice as per Ex.P9. She has also admitted in the cross examination that the contents of the cheque has been filled up by her Advocate. In view of this, it is necessary to see the reply notice issued by respondent as per Ex.P11, wherein respondent has categorically denied the existence of any loan transaction or execution of any promissory note or issuance of Ex.P1 cheque in question. In fact, he has stated that the cheque in question could have been taken away by the daughter of Complainant as they were having very cordial relationship with each other. He also stated in the reply notice that the signature on the cheque is forged. The same has been suggested in the cross examination of PW1. Though PW1 denied that the signature has been forged in her evidence, but admits to the fact that she has received the cheque on 12.05.2009. It is important to note here that reply notice to the first notice sent by

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appellant is on 12.05.2009 as per Ex.P10 by respondent. On 11.05.2009 respondent has replied that there is no existence of any legally recoverable debt or transaction of loan, the issuance of cheque by respondent on the very next day, ie., on 12.05.2009 is highly improbable. Therefore, at this stage, when respondent has denied the transaction of existence of loan or issuance of cheque or execution of promissory note, then no prudent man would handover the cheque on the very next day.

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On careful examination of Ex.P1, it is seen that Ex.P1(a) signature appearing on the cheque is quite different from that of the signature available on Ex.P1 to P4 and also the signature on vakalath. This aspect of the matter has been appreciated by the trial Court by comparing the signature and the same is permissible under law, in view of the fact that it is apparent on the face of record. On perusal through the naked eye, if

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it is ascertained and compared with other material evidence available on record, the same cannot be said to be unsustainable in law. On these two aspects even in cross examination respondent substantially rebutted the presumption in favour of the appellant, which has been proved to the contrary by respondent. Thereby the onus shifts on the appellant to substantiate such rebuttal by showing before this Court and producing cogent material about existence of legally recoverable debt and the transaction of loan as alleged. Though the appellant has stated in the legal notice that the promissory note was taken back and cheque came to be issued, no cogent material is produced by appellant to prove the existence of the loan transaction.

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Secondly, when the signatures are disputed, which does not tally with other documents containing signature of respondent, it becomes bounden duty of the appellant to

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produce sufficient cogent material to substantiate his case to attract Section 138 of NI Act. In the present case appellant has not produced any other material to establish that she had sufficient amount of money and capacity to make payment of loan amount to respondent. Since, appellant has not produced any such cogent material by way of oral or documentary evidence the existence of legally recoverable debt is in question and doubtful. Trial Court has considered all these material aspects both oral and documentary and has passed a well reasoned order acquitting the accused. Appellant has not made out any ground to show that there has been illegality or non application of mind to appreciate the evidence on record in the impugned order passed by the trial Court. Therefore, the impugned order passed by the trial Court does not call for any interference. Hence, point for consideration is answered in the

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negative. Accordingly, I pass the following

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order:

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ORDER

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Appeal is dismissed. No order as to costs.

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Sd/-

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JUDGE

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MSR/VK

Smt. Parvathi W/O Eshwarayya Jadimath, v. Eranna S/O Sannakallayya Anti

Case brief

What is this about?

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Smt. Parvathi W/O Eshwarayya Jadimath, v. Eranna S/O Sannakallayya Anti

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