In a criminal appeal under Section 378(4) CrPC regarding an offence under Section 138 NI Act, the High Court of Karnataka dismissed the appeal filed by the complainant against the Sessions Judge's acquittal of the accused.
The criminal appeal filed by the complainant stands dismissed, confirming the acquittal of the respondent/accused.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 18TH DAY OF DECEMBER, 2023
BEFORE
THE HON’BLE MR. JUSTICE RAJENDRA BADAMIKAR
CRIMINAL APPEAL No. 1133 OF 2023
BETWEEN:
A.K. PREMNATH, AGED ABOUT 74 YEARS, S/O P K GOVINDAN, R/AT NO.4, 5TH CROSS, K H B ROAD, GOPALAPPA LAYOUT, MANORAYANA PALYA, R T NAGAR POST, BENGALURU – 560 032.
….APPELLANT
(BY SRI. TUMBIGI PRABHUGOUDA BASAVANTARAYAGOUDA, ADVOCATE)
AND:
P.K. SUNDARAN, AGED ABOUT 76 YEARS, S/O LATE P K KITTA, R/AT NO.18/3, 5TH CROSS, VASANTHA NAGARA, BENGALURU – 560 052.
…. RESPONDENT
(BY SRI. MAHESH .S, ADVOCATE)
THIS CRL.A IS FILED U/S 378(4) CR.PC PRAYING TO SET ASIDE THE JUDGMENT AND ORDER DATED 01.03.2023 PASSED IN CRL.A.NO.834/2020 BY THE HONBLE LXIX ADDITIONAL CITY CIVIL AND SESSIONS JUDGE, BENGALURU (CCH-70) AND CONFIRM THE JUDGMENT AND ORDER DATED 03.11.2020, PASSED IN C.C.NO.19799/2017 BY THE HON’BLE XVIII ADDITIONAL CHIEF METROPOLITAN MAGISTRATE, BENGALURU AND PASS ANY SUCH OTHER ORDERS AS THIS HON’BLE COURT
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DEEMS FIT IN THE FACTS AND CIRCUMSTANCES OF THE CASE.
THIS APPEAL HAVING BEEN HEARD AND RESERVED FOR JUDGMENT ON 27.11.2023, COMING ON FOR ‘PRONOUNCEMENT OF JUDGMENT’ THIS DAY, THE COURT DELIVERED THE FOLLOWING:
JUDGMENT
This appeal is filed by the appellant / complainant challenging the judgment passed in Crl/A.No.834/2020 on the file of LXIX Additional City Civil and Sessions Judge, Bengaluru, dated 01.03.2023 whereby the learned Sessions Judge has reversed the judgment of conviction and order of sentence passed by the XVIII Additional Chief Metropolitan Magistrate Bangalore in C.C.No.19799/2017 and acquitted the accused / respondent herein.
trial Court.
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months. It is also asserted that accused had also executed on demand promissory note on the same day and issued four post dated cheques for the Rs.10 Lakhs, Rs.22 Lakhs and Rs.6 Lakhs on the same day i.e., 31.03.2017. When the said cheques were presented, they were dishonored for ‘insufficient of funds’ and therefore, complainant got issued a legal notice to the accused. The accused gave a evasive reply and hence, the complainant asserts that he has lodged a complaint under Section 200 of Code of Criminal Procedure (hereinafter referred to as 'Cr.P.C' for short) against the accused for the offences punishable under Section 138 of Negotiable Instruments Act, 1881 (hereinafter referred to as 'the N.I.Act' for short).
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138 of N.I. Act was recorded and the same was denied by the accused.
The accused No.1 got examined himself as DW1 and also produced 13 documents marked at Ex.D1 to Ex.D13.
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offences punishable under Section 138 of N.I. Act by exercising the powers under Section 255(1) of Cr.P.C.
accused No.1 before LXIX Additional City Civil and Sessions Judge, Bangalore, in Crl.A.No.834/2020 dated 01.03.2023. The learned Sessions Judge after re-appreciating the oral and documentary evidence, allowed the appeal and set aside the judgment of conviction passed by the learned Magistrate against the accused No.1 in CC.No.19799/2017 and vide judgment dated 03.11.2020 acquitted him. Being aggrieved by this judgment of acquittal, the complainant is before this Court by way of this appeal.
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counsel for appellant/complainant and learned counsel for respondent/accused. Perused the records.
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that the accused is connecting these cheques and on demand promissory note to other transaction under Ex.D1, but the wife of accused was not examined and defence was not supported. He would also contend that in income tax returns marked at Ex.P13, this amount is shown in the balance sheet and in the Assignment Agreement-Ex.D1, the present cheques are not referred and since financial capacity is not seriously challenged, there is no rebuttal of the presumption and hence, he would contend that the learned magistrate has rightly convicted the accused, but the appellate Court erroneously acquitted him and hence, he would seek for allowing the appeal by restoring the judgment of conviction passed by the learned Magistrate.
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accused since the payment was not made within the stipulated period of three months. Though the payment to the tune of Rs.6 Lakhs by way of cheque has been admitted, it is asserted that at the time of said agreement, as a security, these cheques and promissory note were obtained and question of issuing four cheques of the same date for payment of Rs.60 Lakhs under Ex.P1 to Ex.P4 would not arise and a single cheque would have been issued. He would also contend that a new case of promotion of circus is made out and his financial capacity itself is challenged and when payment of Rs.6 Lakhs under Ex.P1 is made by cheque, it is hard to accept that Rs.60 Lakhs is paid by way of cash. It is also asserted that PW2 was cited as an eyewitness for the transaction who claims that he has introduced the complainant to accused in 2015, but the records disclose that the accused and complainant transacted in 2012 itself, as admitted by the complainant and hence, it is evident that the evidence of PW2 is not trustworthy. It is asserted that Ex.P13 is produced as an afterthought story by creating and in income tax returns,
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this transaction was not shown, but it is only a balance sheet which is prepared by the chartered accountant and balance sheet is not submitted to the income tax department and chartered accountant is also not examined to substantiate the said contention. Hence, he would contend that accused has raised a probable defence, which was not properly appreciated by the learned Magistrate and the learned Magistrate completely relied on Ex.P13, which cannot be looked into and the learned Sessions Judge in the
appeal has rightly appreciated the facts and reversed the judgment of conviction as it was perverse. Hence, he would contend that the judgment of acquittal passed by learned Sessions Judge is well-reasoned one and does not suffer from any perversity so as to call for any interference and sought for dismissal of the appeal.
“Whether the judgment of acquittal passed by learned Sessions Judge in Crl.A.No.864/2020
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by reversing judgment of conviction passed by XVIII Additional Chief Metropolitan Magistrate, Bengaluru in C.C.No.19799/2017 is perverse, arbitrary and erroneous so as to call for any interference by restoring the judgment of learned Magistrate.”
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towards repayment of the loan amount of Rs.60 Lakhs, the accused has issued four cheques as per Ex.P1 to Ex.P4. According to the complainant, Ex.P1 was issued on 28.10.2016 by putting postdated 31.03.2017, while Ex.P2 to Ex.P4 were issued on 06.11.2016 by quoting the date 31.07.2017 itself . When ExP2 to Ex.P4 were issued on the same date i.e., 06.11.2016 by putting date as 31.03.2017 what was the need for issuing three cheques is not explained. All the three cheques were pertaining to same branch, same account and issued on the same date. In that event, a single cheque could have been issued on 06.11.2016, but the complainant claims that he received three cheques. There is no proper explanation from complainant for receipt of three cheques.
the accused and complainant have entered into an Assignment Agreement as per Ex.D1. Ex.D1 is admitted and it was between accused No.2 and complainant. In the cross
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examination, Ex.D1 came to be admitted and it is dated 09.02.2016. Under Ex.D1, accused No.2 has agreed to execute sale deed pertaining to flat No.404 for a sum of Rs.35 Lakhs and received Rs.6 Lakhs in advance by way of two cheques for Rs.1 Lakhs each and one cheque of Rs.4 Lakhs. When the complainant has paid three cheques for payment of advance of Rs.6 Lakhs pertaining to Ex.D1, why he paid amount of Rs.60 Lakhs by way of cash is not at all forthcoming. The complainant admits that he had knowledge that any transaction above Rs.20,000/- is required to be done through banking transaction only. As regards Ex.D1, he dealt all the transactions by cheque that too for a sum of Rs.6 Lakhs, but for a huge amount of Rs.60 Lakhs he claims to have paid it by cash. This clearly creates serious doubt regarding the genuineness of the case of the complainant and his conduct.
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finalized. There is also no serious dispute that this Rs.6 Lakhs was already returned by accused No.2 to the complainant. Though under Ex.D1, the time stipulated was three months and the amount was only Rs.35 Lakhs out of which Rs.6 Lakhs were already paid by the complainant, he
did not take any steps to enforce this contract, but on 03.07.2017, he issued a legal notice to both the accused calling upon them to execute the sale deed. Interestingly, from Ex.D4 it is evident that the said notices were replied by accused through their counsel, asserting that the contract has been terminated and further, there is specific assertion that the cheques under Ex.P1 to Ex.P4 were given as security for the transaction pertaining to Ex.D5 and they were now misused.
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issuance of notice for specific performance. He has also admitted that he has not taken any steps in this regard. It means that he has not seriously persuaded this transaction and he was required to pay Rs.35 Lakhs under Ex.D1 and Ex.D1 is dated 09.02.2016. If he wanted to act upon Ex.D1, there was no need for him to advance a loan Rs.60 Lakhs on 28.10.2016 and 06.11.2016, but he could have sought for enforcement of the contract itself, which was still pending on that day. But the complainant without payment of balance of Rs.29 Lakhs pertaining to Ex.D1 to enforce the assignment agreement, claims to have paid Rs.60 Lakhs as a loan and there was no need for him to advance a loan of Rs.60 Lakhs and accused could have received Rs.29 Lakhs towards sales consideration and balance Rs.31 Lakhs could have been the loan amount. But the conduct of the complainant in this regard without pursuing Ex.D1 putting forward a story of advancement of loan in October & November to the tune of Rs.60 Lakhs, creates a serious doubt regarding a very transaction itself. Further, he has issued a legal notice in the month of July-2017 for
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enforcement of the said contract, but he has not taken any steps in this regard. When the complainant was not able to pay Rs.29 Lakhs before May-2016, his assertion that he paid Rs.60 Lakhs by cash in October and November creates serious doubt.
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accountant and he is not examined. Hence, Ex.P13-income tax returns though can be considered, the balance sheet produced along with it cannot be considered as it does not establish that it is income shown in the income tax returns. The balance statement amount of Rs.60 Lakhs, which now shown, is not referred in income tax returns submitted. Further, as observed above, when he is incapable of paying Rs.29 Lakhs for purchasing the property of accused No.2 under Ex.D1, it is hard to accept that he has advanced Rs.60 Lakhs thereafter within 4 to 5 months. Interestingly, when for Rs.6 Lakhs he has issued three cheques, it is hard to accept that for a sum of Rs.60 Lakhs he did not issue any cheque, but amount was paid in cash.
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that event, question of PW2 introducing accused No.1 to the complainant does not arise at all. Hence, it is evident that he is a planted witness and his name is also not referred in the complaint.
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enunciated in the above cited decision would not come to the aid of the accused in any way.
LRS ], the accused can rebut the presumption by way of cross-examination or on the basis of evidence and documents relied by the complainant or leading his own evidence. Ex.D1 completely destroys the defence of the complainant and considering the conduct of the complainant and his financial capacity, it is evident that the presumption available in favour of complainant stands rebutted. No other convincing evidence is produced by the complainant to substantiate his case. Considering the conduct of the complainant and when the presumption stands rebutted, the learned Sessions Judge has rightly acquitted the accused by reversing the judgment of conviction passed by learned Sessions Judge. No illegality or infirmity is found in the judgment of acquittal passed by the learned Sessions
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Judge. Hence, the appeal is devoid of merits. Considering these facts and circumstances, I am constrained to answer the point under consideration in the negative. As such, I proceed to pass the following:
ORDER
(i) The appeal stands dismissed .
Sd/JUDGE
DS
3 issues framed by the court
Whether the judgment of acquittal passed by the Sessions Judge by reversing the conviction is perverse, arbitrary and erroneous so as to call for interference.
Whether the presumption under Section 139 of the Negotiable Instruments Act stands rebutted due to inconsistencies in the complainant's evidence and conduct.
Whether the learned Sessions Judge correctly appreciated the cross-examination rebutting the presumption and reversing the conviction.
Colour shows how this judgement treated each authority
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RAJARAM S/O SRIRAMULU NAIDU (SINCE DECEASED) THROUGH LRS VS. MARUTHACHALAM (SINCE DECEASED) THROUGH LRSRelied on¶6
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4 provisions across 2 enactments
A.K. PREMNATH
P.K. SUNDARAN
RAJENDRA BADAMIKAR
As recorded by the court registry
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