Dismissed

Chandrahas Bhatt v. Subhas S/O. Virupakshappa

Karnataka HC6 Dec 2022CRL.A/2645/2012

Case brief

AI extract

What is this about?

Criminal Appeal filed by a cheque drawer to set aside acquittal under Section 138 of the Negotiable Instruments Act. The High Court upheld the Trial Court's acquittal, finding the drawer successfully rebutted the statutory presumption of consideration by disproving the existence of the alleged debt.

What did the court decide?

The Criminal Appeal stands dismissed and the impugned acquittal is confirmed.

Chandrahas Bhatt Vs Subhas S/O. Virupakshappa — Cheque Dishonour | Karnataka HC (2022)

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CRL.A.No. 2645/2012

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IN THE HIGH COURT OF KARNATAKA,

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DHARWAD BENCH

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DATED THIS THE 6^TH DAY OF DECEMBER, 2022

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BEFORE

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THE HON'BLE MR JUSTICE S.RACHAIAH CRIMINAL APPEAL NO.2645/2012

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BETWEEN

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CHANDRAHAS BHATT S/O. SUBRAY BHATT, AGE: 71 YEARS, OCC: AGRICULTURE, R/O. MAHAVEER CIRCLE, GANGAVATHI, DIST: KOPPAL.

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.....APPELLANT

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(BY SRI SABEEL AHMED, ADV. FOR SRI A S PATIL, ADV.)

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AND

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SUBHAS S/O. VIRUPAKSHAPPA AGE: 43 YEARS, OCC: BUSINESS, R/O.SUHAS ENTERPRISES, NEAR POLICE STATION, KAMPLI, TQ: HOSPET, DIST: BELLARY.

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…..RESPONDENT

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(BY SRI J BASAVARAJ, ADV.)

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THIS CRIMINAL APPEAL IS FILED U/S 378(1) OF CR.P.C. SEEKING TO SET ASIDE THE IMPUGNED JUDGEMENT AND ORDER OF ACQUITTAL DATED 20.03.2012 PASSED BY THE PRL. CIVIL JUDGE & JMFC COURT, GANGAVATHI IN C.C.NO.492/2008, CONSEQUENTLY TO CONVICT THE RESPONDENT FOR THE OFFENCES P/U/S 138 OF N.I. ACT.

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THIS APPEAL HAVING BEEN HEARD AND RESERVED FOR JUDGMENT ON 19.10.2022, THIS DAY, THE *COURT PRONOUNCED THE FOLLOWING:

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CRL.A.No. 2645/2012

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JUDGMENT

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This appeal is filed by the appellant being aggrieved by the judgment and order of acquittal dated 20.03.2012 in C.C.No.492/2008 on the file of the Principal Civil Judge and JMFC, Gangavathi (for short, ‘the Trial Court’), wherein the Trial Court acquitted the accused/respondent for the offence under Section 138 of Negotiable Instruments Act, 1881 (for short, ‘the N.I. Act’).

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For the sake of convenience, hereinafter the parties are referred to as per their ranking before the Trial Court. The appellant is the complainant and respondent is the accused.

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3. The brief facts of the case :

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The appellant is the owner of Chandrahas theatre situated at Gangavathi town and the respondent/accused was film distributor and he used to hire theatre for the purpose of exhibiting the film/movies. The accused was due a sum of Rs.2,50,000/- and in order to discharge the said liability, he issued a cheque for a sum of Rs.2,50,000/- on 30.12.1999 and asked the complainant to present the Bank for its realization. Accordingly, the complainant has presented the cheque for encashment on 06.03.2000 through his banker i.e.,

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CRL.A.No. 2645/2012

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Tungabhadra Grameen Bank, Kampli. The said cheque got bounced and the complainant has received an endorsement from the bank on 10.03.2000 as ‘no such account with us’. Thereafter, the complainant got issued legal notice on 15.03.2000 and the same was returned on 21.03.2000 with an endorsement ‘refused to accept’. Therefore, the complainant filed the complaint before the Trial Court.

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To prove his case, the complainant examined 4 witnesses and got marked exhibits at Ex.P-1 to Ex. P-13 and on the other side, the accused examined two witnesses DW-1 and DW-2 respectively.

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The Trial Court opined that Ex.P-1 cheque was not issued by the accused in which he has maintained account with the bank. According to the Trial Court, issuance of the cheque on an account not maintained by the accused in the bank is not an offence covered under Section 138 of N.I. Act. Being aggrieved by the judgment and order of acquittal the appellant preferred this appeal.

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Heard Sri Sabeel Ahmed, learned counsel for appellant and Sri J. Basavaraj, learned counsel for respondent.

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CRL.A.No. 2645/2012

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Sri Sabeel Ahmed, learned counsel for appellant submits that, the reasons assigned by the Trial Court while passing the impugned judgment and order acquittal, are erroneous and unsustainable. It is further submitted that even though the appellant/complainant has examined 3 witnesses and got marked numerous documents, the Trial Court erroneously appreciated the evidence and documents thereby causing substantial miscarriage of justice.

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It is further submitted that, the evidence of PW3Venkatasubramanya, Bank Manager of the Syndicate Bank, Kampli Branch, clarified that the account and the cheque both are belonging to his bank. However, the documents with respect to the said account were not available as the documents usually would be destroyed after 5 years, if the account is not maintained by the account holder. It means, the accused had an account in the said Syndicate Bank but, the documents pertaining to the account were destroyed as 5 years was over and the accused has not made the transaction in the account. With these submissions, learned counsel for the appellant prays to allow the appeal.

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Per contra , Sri J. Basavaraj, learned counsel for the respondent/accused submits that the accused has denied the

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CRL.A.No. 2645/2012

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transaction and also denied the relationship as stated by the complainant. It is further submitted that at no relevant point of time, the accused did exhibit the film in the talkies owned by the complainant. The complainant has not produced any documents to show that there was an agreement or arrangement entered into between the complainant and the accused in that regard. It is further submitted that, in absence of the documents to show that the complainant has lent the amount as stated supra, it cannot be said that the accused was in due for a sum as stated in Ex.P-1.

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It is further submitted that the accused has raised valid contention that there was a transaction between his father and complainant and the same has been admitted by the complainant. The complainant might have misused the acquaintance with the father of the accused and might have obtained the cheque from his father for discharge of debt for a sum of Rs.50,000/- which he alleged to have lent to the father of the accused. Therefore, there is no liability existing to pay the amount to the complainant. Having said thus, learned counsel for respondent prays to dismiss the appeal.

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CRL.A.No. 2645/2012

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Heard the rival contentions of the learned counsels

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for the respective parties and also perused the documents available on record.

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The points which arise for my consideration are:

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1) Whether the judgment and order of acquittal passed by the Trial Court is justifiable?

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2) Whether the appellant has made out grounds to interfere with the judgment and order of acquittal?

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Before adverting to the facts of the case, it is relevant to refer the judgment of the Hon’ble Supreme Court in the case of Rangappa Vs. Sri Mohan,¹ which reads thus:

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“Negotiable Instruments Act, 1881 – S.139 Presumption under –Scope of –Held, presumption mandated by S.139 includes a presumption that there exists a legally enforceable debt or liability – However, such presumption is rebuttable in nature – Criminal Trial – Proof – Presumptions – Generally.

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“Negotiable Instruments Act, 1881 – Ss. 138 and 139 – Purpose, relative scope and functioning of, explained – Rebuttable presumption under S.139 – Standard of proof for rebutting, stated – Manner in which defence can be raised by accused, outlined – Reliance on prosecution materials by accused to

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1 (2010) 11 SCC 441

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CRL.A.No. 2645/2012

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prove defence, held, permissible – Criminal Trial – Proof – Burden and Onus of proof – Reverse onus statutory clauses – Interpretation of – Standard of proof in such cases.”

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There is a mandate of presumption of consideration in terms of provisions of the Act and the onus shifts to the accused on proof of issuance of the cheque to rebut the presumption that the cheque was issued not for discharge of any debt or liability.

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In this case, the accused has entered into the witness box and denied the transaction with the complainant. However, on perusal of evidence of PW1, makes it clear that, the father of the accused was a film distributor and the complainant was having a transaction with the father of the accused. Further, the complainant has admitted that the father of the accused had availed a loan of Rs.50,000/- from the complainant.

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The complainant, in the cross-examination has admitted that, to show the loan transaction with the accused, the complainant has stated that the said loan of Rs.2,50,000/given to the accused was mentioned in the income tax

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assessment register. However, the complainant has failed to produce the said document.

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It is settled principles of law that, once the accused entered the witness box and denied the transaction, the onus would be shifted to the complainant to prove the said transaction by producing cogent evidence. However, the complainant failed to produce any documents regarding the loan said to have given to the accused.

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It is settled law that presumption mandated that the holder of a cheque having the said cheque for the legally recoverable debt or liability. The said presumption is rebuttable. In this case, the accused denied the transaction with the complainant and complainant has failed to produce any document regarding loan transaction and also admitted that he has not aware which film the accused brought and exhibited in his film talkies. However, the complainant further admitted that the father of the accused had exhibited Shabdavedhi film in his film talkies. Thus, the accused rebutted the presumption regarding the loan transaction has not taken place between the complainant and him.

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CRL.A.No. 2645/2012

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Now it is relevant to analyze the evidence of PW1.

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PW-1 has admitted in the cross-examination that he did not remember which Kannada film the accused had exhibited in his talkies and the father of the accused namely, Virupakshappa was the film distributor and in the year 2000, the said Virupakshappa brought ‘Shabdavedhi’ movie and exhibited. It is further admitted that to bring the said film, the Virupakshappa had availed a loan of Rs.50,000/- from the complainant. When the specific question was put to him regarding the clearance of said Rs.50,000/-, the complainant has denied it. It appears that no action has been initiated against the father of the accused to recover the amount of Rs.50,000/-. It indicates that the cheque in question might have issued in connection with the said loan transaction. However, the complainant presented the said cheque by filling it a sum of Rs.2,50,000/- and presented the same to the bank on 06.03.2000 which is unsustainable.

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PW-2 who is friend of PW-1 stated that at about 7

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to 8 years ago, when he had been to cloth shop, there he overheard about the financial issue between the complainant and accused. There, the accused issued a cheque for a sum of

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Rs.2,50,000/-. It is hard to believe that the cheque was issued in his presence.

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PW-3 is the Bank Manager who deposed that he has issued endorsement as ‘no such account’. Further, he clarified it as the accused might have had the bank account however, the documents pertaining to the said account were not available. Further, he clarified that the account is not maintained properly or the drawer failed to have a transaction regularly till 5 years was over, after 5 years the said account will be closed and documents would be destroyed. Therefore, on appreciating the evidence of the Bank Manager, it appears that the cheque might have taken by the complainant prior to 5 years ago and presented on 06.03.2000. Hence, the complainant has failed to prove the existence of legally recoverable debt. Therefore, Section 138 of N.I. Act would not be attracted.

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On perusal of the evidence of PW1 it appears that, the complainant has failed to prove the transaction with the accused. Though he stated that the accused had availed loan from the complainant and assured him that the accused would bring the cinema for its exhibition in the said talkies owned by the complainant, except the said contention, the complainant

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CRL.A.No. 2645/2012

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has not produced any other witnesses or documents to show that he has lent amount of Rs.2,50,000/-.

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It is also relevant to refer the evidence of DW-1. DW-1 is the accused and he has deposed that his father and the complainant were having transaction and he was not relating to any such transaction that had taken place between his father and the complainant. Similarly, PW1 has admitted in the cross-examination that himself and the father of the accused had exhibited Shabdavedhi Kannda film together. It is further deposed that, the father of the accused had availed a loan of Rs.50,000/- from him. The complainant further deposed that, the said amount was not repaid by the father of the complainant.

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On analysis of the entire evidence, the Trial Court has not committed any error in acquitting the accused. Therefore, interference with the judgment of the Trial Court is unwarranted.

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In the light of the observations made above, the points which arose for my consideration are answered as:

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Point No.1 is answered in the affirmative

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CRL.A.No. 2645/2012

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1. Point No.2 is answered in the negative

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Hence, I proceed to pass the following :

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ORDER

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i) The appeal filed by the appellant stands dismissed.

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ii) The judgment and order of acquittal dated 20.03.2012 in C.C.No.492/2008 passed by the Principal Civil Judge and JMFC., Gangavathi, is confirmed.

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Sd/JUDGE

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Naa

Chandrahas Bhatt v. Subhas S/O. Virupakshappa

Case brief

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Chandrahas Bhatt v. Subhas S/O. Virupakshappa

Case brief

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