Dismissed

Sri C K Ravi Kumar v. Sri G S Venkatesh

Karnataka HC6 Oct 2023CRL.A/1040/2016

Case brief

AI extract

What is this about?

The High Court of Karnataka dismissed the criminal appeal filed by a cheque issuer challenging an acquittal. The Court held that the appellant successfully rebutted the statutory presumption under the Negotiable Instruments Act by proving the funds were borrowed for a third party and the cheque was merely for security.

What did the court decide?

The criminal appeal was dismissed and the acquittal of the respondent was confirmed.

Sri C K Ravi Kumar Vs Sri G S Venkatesh — Cheque Dishonour | Karnataka HC (2023)

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CRL.A.NO.1040/2016

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 6^TH DAY OF OCTOBER, 2023

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BEFORE

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THE HON'BLE MS.JUSTICE J.M.KHAZI

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CRIMINAL APPEAL NO. 1040 OF 2016

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BETWEEN:

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SRI. C.K. RAVI KUMAR, S/O. SRI. C. KALE GOWDA, AGED ABOUT 42 YEARS, R/AT NO.305, 4^TH CROSS, KUVEMPU NAGAR, MANDYA - 571401.

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…APPELLANT

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(BY SRI. HARIPRASAD M.B., ADVOCATE)

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AND:

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SRI. G.S. VENKATESH, S/O. SHIVANE GOWDA, AGED ABOUT 58 YEARS, JUNIOR FIELD OFFICER PLD BANK, R/O 17^TH CROSS, V.V. NAGAR KALLAHALLI, MANDYA - 571401.

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(BY SRI. M.G.RAVISHA, ADVOCATE)

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THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378(4) OF CODE OF CRIMINAL PROCEDURE PRAYING TO SET ASIDE THE IMPUGNED ORDER OF ACQUITTAL DATED 7.5.2016 PASSED BY THE JUDICIAL MAGISTRATE FIRST CLASS, MANDYA IN CC NO.1087/13. CONVICT THE RESPONDENTACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF THE NEGOTIABLE INSTRUMENTS ACT.

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CRL.A.NO.1040/2016

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THIS CRIMINAL APPEAL HAVING BEEN HEARD AND RESERVED ON 10.07.2023, COMING ON FOR PRONOUNCEMENT OF JUDGMENT THIS DAY, THE COURT DELIVERED THE FOLLOWING:

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J U D G M E N T

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This appeal is by the complainant filed under Section 378(4) of Cr.P.C, challenging the judgment and order dated 07.05.2016 passed by the trial Court in C.C.No.1087/2013, whereby the complaint filed by the complainant under Section 200 Cr.P.C for the offence punishable under Section 138 of N.I.Act came to be dismissed.

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For the sake of convenience, the parties are referred to by their rank before the trial Court.

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It is the case of the complainant that he and accused are known to each other since long time. For his legal necessity viz., to discharge hand loan and for household requirements, on 14.02.2010, accused borrowed a sum of Rs.1,50,000/- with a promise to repay the same within three months. On the same day, he issued a cheque dated 14.05.2010 for Rs.1,50,000/-

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CRL.A.NO.1040/2016

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drawn on MDCC Bank, Mandya Branch by way of security and directed the complainant to present it on or after 14.05.2010 and realize the amount. Accordingly, after informing the accused, complainant present the cheque on 14.05.2010, for realization. However, it was dishonoured on the ground "Funds insufficient". Complainant got issued a legal notice dated 31.05.2010. The same is served through his mother Smt.Shanthamma on 02.06.2010. Despite the same, the accused has neither paid the amount due nor sent any reply. Without any alternative, the complaint is filed.

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After due service of notice, accused has

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appeared before the trial Court and contested the matter. He pleaded not guilty and claimed trial.

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In support of his case, complainant examined himself as PW-1 and got marked Ex.P1 to 9.

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During the course of his statement under Section 313 Cr.P.C, accused has denied the incriminating evidence.

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In fact accused has entered into the witness box and examined himself as DW-1. He has got marked Ex.D1.

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Vide the judgment and order dated

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07.05.2016, the trial Court acquitted the accused.

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Being aggrieved by the same, the complainant is before this Court contending that the impugned judgment and order is erroneous and unsustainable both in law and on facts and liable to be set aside. The trial Court failed to appreciate the fact that the cheque in question was issued by the accused and on presentation it is dishonoured and as such the presumption under Sections 118 and 139 of N.I.Act is attracted and therefore the burden is on the accused to rebut the same. The trial Court has erred in placing reliance on Ex.D1, which is a self-serving statement and has no connection whatsoever to the transaction between the parties.

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Having regard to the fact that the accused is

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being prosecuted for criminal offence, the trial Court has failed to note that it is not case of fixing liability for payment of money as in civil case. Since the accused has contended that he borrowed the money for and on behalf of his friend, it was incumbent upon him to prove the said fact and trial Court has failed to appreciate this aspect. The trial Court has also erred in not considering the decision of the Hon'ble Supreme Court in Vasanthkumar vs. Vijayakumari ( Vasanthkumar ) reported in 2015 (4) KCCR 281 (SC) . Viewed from any angle the impugned judgment and order is not sustainable and prays to allow the appeal, set aside the impugned judgment and order of trial Court, convict the accused and sentence him accordingly.

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In support of his argument, learned counsel for complainant has relied upon the following decisions:

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(1) T.Vasanthkumar Vs. Vijayakumari ( T.Vasanthkumar )¹

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(2) D.K.Chandel Vs Wockhardt Ltd and Anr. ( D.K.Chandel )²

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1 Crl.A.No.728/2015

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CRL.A.NO.1040/2016

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On the other hand, learned counsel appearing for the accused has supported the impugned judgment and order contending that on appreciation of oral and documentary evidence, the trial Court has come to a correct conclusion in acquitting the accused and prays to dismiss the appeal.

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Heard elaborate arguments of both sides and

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perused the record.

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Thus, it is the definite case of complainant that accused borrowed a sum of Rs.1,50,000/- on 14.02.2010 with a promise to repay the same within three months and on the same day issued a post dated 14.05.2010, cheque for Rs.1,50,000/- by way of security, and when he failed to keep up with the promise and on the insistence of complainant, he directed complainant to present the cheque and realize the amount. However, when presented for realisation, it was dishonoured for want of sufficient funds and after issuing legal notice, and receiving evasive reply complaint is filed.

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2 (2020) 13 SCC 471

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Though accused admitted that the subject cheque is issued by him drawn on his account maintained with his banker and it bears the signature, he has taken up a specific defence that the loan was borrowed for his friend and the cheque was issued by way of security. In fact, the said loan was repaid. However, complainant failed to return the cheque and has filed this complaint.

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Having regard to the fact that the cheque in question is drawn by the accused on his account maintained with his banker and it bears his signature, as held in T. Vasanthkumar and D.K Chandel , the Court is required to draw presumption under Sections 118 and 139 of N.I.Act that the cheque is issued towards the payment of any legally recoverable debt or liability and the burden is on the accused to rebut the presumption. Of course it is sufficient for the accused to rebut the presumption by preponderance of probabilities. If the accused succeeds in rebutting the presumption, the burden shifts on the complainant to prove his case. Of

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course, the complainant is required to discharge the burden beyond reasonable doubt.

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It is relevant to note that by sending reply to

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the legal notice, the accused at the earliest available opportunity has spelt out his defence and denied that he borrowed hand loan of Rs.1,50,000/from the complainant and that he was only a surety for the loan borrowed by his friend B.R.Manju. During his crossexamination, the complainant has admitted that Ex.D1 is the small notebook given by him to the accused and in the said notebook, he has noted the receipt of a total sum of Rs.1,20,000/-. Though the complainant has claimed that the entry in Ex.D1 relates to some other transaction, he has not explained as to what was the said transaction.

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Through the cross-examination of PW-1, the accused has elicited that the complainant has filed several cheque bounce cases, which goes to show that he is habitually involved in lending money. Though the complainant has deposed that he submitted income tax

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returns, but as admitted by him in these returns, he has not disclose the fact of he having lent Rs.1,50,000/- to the accused and also the amount received as per Ex.D1. The entries made in Ex.D1 supports the defence of the accused that the loan in question was borrowed by his friend and the cheque was issued by way of security and despite the payment of the amount, the complainant has chosen to file the complaint by utilising the said cheque.

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During the course of his evidence, the accused has reiterated the defence taken by him. Despite lengthy cross-examination, the complainant has failed to dislodge his evidence. Thus, the accused has rebutted the presumption under Sections 118 and 139 of the N.I.Act and proved that the cheque was not issued towards the payment of any legally recoverable, debt or liability.

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Hence, the burden is shifted on the complainant to prove that in fact, he had lent Rs.1,50,000/- to the accused and the cheque was issued towards the payment of the same. As noted earlier, the complainant has failed to place any material on record to

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show that at the relevant point of time, he was having cash and a sum of Rs.1,50,000/- and paid the same to the accused. This was necessary as the accused has challenged the financial capacity of complainant to lend the said sum.

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In this regard complainant has deposed that he had some amount and he took balance amount from his friend and gave it to the accused. However, he is not very specific about the exact sum which he had and what is the amount taken from his friend and who the said friend was and he could have examined the said person. As admitted by him, in his income tax returns, he has not disclosed the fact of having borrowed certain sum from his friend to pay to the accused. He has admitted that he has constructed house about two years back, after which the income tax authorities issued notice to him and in the reply to the said notice, he has given details of the loans due to him. Admittedly, the said document is also not produced which would have thrown light on the transaction relating to the present complaint.

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In the light of the cross-examination of complainant, the accused has not only rebutted the presumption, but also demonstrated that the case put forth by the complainant is false. Appreciating the oral and documentary evidence placed on record, the trial Court has come to a correct conclusion that the charges leveled against accused or not proved beyond reasonable doubt and acquitted him. In T.Vasanthkumar and D.K.Chandel , on facts, the Hon'ble Supreme Court accepted the case of the complainant. However the said decisions are not applicable to the facts and circumstances of the present case. On re-appreciation of the oral and documentary evidence placed on record, this Court is of the considered opinion that the impugned judgment and order does not call for interference by this Court. In the result the appeal fails and accordingly the following:

ORDER

dismissed.

CRL.A.NO.1040/2016