Dismissed

K Nagaraj v. K S Shivananja Naik

Karnataka HC15 Mar 2024CRL.A/1097/2018

Case brief

AI extract

What is this about?

The High Court dismissed a criminal appeal filed by a complainant challenging the acquittal of the accused in a cheque bouncing case. Finding that the accused rebutted the presumption of liability under Section 139 NI Act by proving the cheque was blank and given for a crop sale later modified due to price increases, the Court confirmed the trial Court's judgment.

What did the court decide?

Criminal appeal dismissed; impugned judgment and order confirming acquittal confirmed.

K Nagaraj Vs K S Shivananja Naik — Cheque Dishonour | Karnataka HC (2024)

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CRL.A NO.1097 OF 2018 1

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 15^TH DAY OF MARCH, 2024

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BEFORE

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

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CRIMINAL APPEAL NO.1097 OF 2018

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BETWEEN:

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K NAGARAJ S/O RUDRAPPA AGED ABOUT 65 YEARS, OCC. AGRICULTURIST D.NO.3682/A47, TARALABALU NAGAR BEHIND VANI RICE MILL DAVANAGERE - 577 001

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……APPELLANT

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(BY SRI. R GURURAJ, ADVOCATE)

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AND:

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K S SHIVANANJA NAIK S/O SEETARAM NAIK AGED ABOUT 51 YEARS, OCC. AGRICULTURIST R/O KAVALI THANDA KATTALAGERE POST, CHANNAGIRI TALUK DAVANAGERE DISTRICT - 577 001

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…….RESPONDENT

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(BY SRI. H.R.SHOWRI, ADVOCATE)

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THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378(4) OF CR.P.C PRAYING TO SET ASIDE THE JUDGMENT DATED 02.05.2018 PASSED IN CRIMINAL CASE NO.793/2017 ON THE FILE OF III ADDITIONAL SENIOR CIVIL JUDGE & VII ADDITIONAL MACT, AT DAVANAGERE AND CONVICT THE ACCUSED/RESPONDENT FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF NEGOTIABLE INSTRUMENTS ACT BY ALLOWING THIS CRIMINAL APPEAL, IN THE INTEREST OF JUSTICE.

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CRL.A NO.1097 OF 2018 2

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THIS APPEAL HAVING BEEN HEARD AND RESERVED ON 15.02.2024, 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 filed under Section 378(4) is by the complainant challenging the acquittal of

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respondent/accused by dismissing the complaint filed by him alleging offence punishable under Section 138 of Negotiable Instruments Act, 1881 (for short 'N.I. Act').

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

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Complainant filed the complaint alleging that

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he and accused are agriculturist and known to each other. He is permanent resident of Davangere, but owning Garden lands at Kasettihalli of Channagiri Taluk. During July 2014, accused offered to buy Areca nut crop grown in the land for one year for a sum of Rs.10 lakhs and he offered to pay the amount after six months. However, accused failed to pay the amount and when approached by the complainant, he sought some more

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CRL.A NO.1097 OF 2018 3

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time. Ultimately on request and demand by the complainant during the month of December 2015, accused issued cheque dated 25.04.2016. When the subject cheque was presented for encashment, it was dishonoured for want of sufficient funds in the account of accused. Complainant got issued a legal notice. Though duly served, the accused has failed to pay the amount due under the cheque. He has also not sent any reply and without any alternative complaint is filed.

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After due service of summons accused had resisted the case. He has pleaded not guilty and claimed trial.

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In order to prove the allegations against the accused, complainant has examined himself as PW-1 and relied upon Ex.P1 to 8.

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

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CRL.A NO.1097 OF 2018 4

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Though the accused has not led any oral evidence, during the cross-examination of complainant, he has got marked Ex.D1 and 2.

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Vide the impugned judgment and order the trial Court acquitted the accused.

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Aggrieved by the same, complainant has filed this appeal contending that the trial Court has erred in dismissing the complaint. The impugned order is perverse, illegal and capricious and as such liable to be set aside. The trial Court has failed to note that complainant and accused have different transactions and complainant has proved the allegations against accused by cogent and convincing evidence. However, accused has not let any contra evidence to prove his defence. In the light of presumption under Section 139 of N.I. Act, the evidence placed on record is sufficient to hold accused guilty of the allegations. The impugned judgment and order is erroneous, unjust and opposed to law, facts and probabilities of the case.

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CRL.A NO.1097 OF 2018 5

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On the other hand, learned counsel for the accused has supported the impugned judgment and order and submitted that earlier to the present transaction, about 4-5 times accused has purchased Areca nut crop from the complainant and this time though complainant agreed to sell the Areca nut crop for Rs.10 lakhs and received a blank cheque by way of security, in the meanwhile the rate of Areca nut increased exponentially and therefore complainant demanded additional sum of Rs.15 lakhs and in fact, accused credited a sum of Rs.6,60,000/- to the account of complainant. However, complainant prevented the accused from harvesting the Areca nut crop unless he pay additional sum of Rs.15 lakhs and he has also not returned Rs.6,60,000/- paid by the accused by way of advance. When accused demanded return of the said amount, complainant has filed this complaint. In fact, accused has filed a private complaint against the complainant. In the light of the above facts and circumstances, the trial Court has rightly dismissed the complaint and sought for dismissal of the appeal also.

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CRL.A NO.1097 OF 2018 6

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In support of his arguments learned counsel for accused has relied upon the decision in A.M.Govindegowda Vs. B.V.Ravi ( Govindegowda i )¹ .

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Having regard to the fact that accused admit that the subject cheque is drawn on his account, maintained with his banker and it bears his signature, presumption under Section 139 of N.I Act comes into operation and the initial burden is on the accused to rebut the presumption and establish that the cheque in question was not issued towards payment of any legally recoverable debt or liability and on the other hand, the circumstances in which the subject cheque has reached the hands of complainant. As held by the Hon'ble Supreme Court in Rangappa Vs. Sri Mohan ( Rangappa )²

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order to rebut the presumption, it is not necessary for the accused to lead evidence. He may also rely upon the evidence lead by the complainant and prove his defence.

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1 2015(5) Kar.LJ 472

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2 (2010) 11 SCC 441

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CRL.A NO.1097 OF 2018 7

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The main defence of the accused is that since the rate of Areca nut increased substantially, complainant prevented the accused from harvesting the Areca nut crop, unless he pay him Rs.15 lakhs in addition to what has been agreed and in fact, though he credited Rs.6,60,000/- into the account of complainant and also paid Rs.40,000/- in cash, the complainant was not satisfied and he prevented accused from harvesting the Areca nut crop and also fail to return Rs.7 lakhs received from him and instead he has filed a private complaint against the accused.

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During his cross-examination, complainant has admitted that when the transaction between complainant and accused took place, the rate of Areca nut was Rs.14,000/- to Rs.25,000/- per quintal and it suddenly increased to Rs.80,000/- per quintal. This supports the defence of the accused that when the rate of the Areca nut increased nearly 3 times than what was there when the agreement entered into between the parties, complainant did not allow him to harvest the

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CRL.A NO.1097 OF 2018 8

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Areca nut crop. The fact that accused has paid additional sum of Rs.6,60,000/- by transferring to the account of complainant also support the defence of the accused that complainant demanded additional sum. With regard to transfer of Rs.6,60,000/- to his account, the complainant has come with an explanation that it was the loan taken by the accused, which he has returned by transferring to his account.

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However in the complaint, the complainant has not pleaded that in addition to purchasing Areca nut crop, the accused had also borrowed money from him. In fact, during his cross-examination, the complainant has stated that he is having document to show that Rs.6,60,000/- credited to his account by the accused is in respect of loan taken by him. However, complainant has not chosen to produce the said document. Production of the said document would have supported the contention of complainant that Rs.6,60,000/- transferred by accused is in respect of loan transaction and it has nothing to do with the liability incurred through the subject cheque.

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CRL.A NO.1097 OF 2018 9

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During his cross-examination, complainant has stated that in his income tax returns, he has not reflected the fact of having given hand loan to the accused.

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Ex.D2 is the copy of complaint filed by accused against the present complainant wherein he has alleged that on the demand made by complainant for additional sum of Rs.15 lakhs to permit him to harvest the Areca nut crop, he has transferred RS.6,60,000/- and paid Rs.40,000/- in cash. But despite the same complainant has neither allowed him to harvest the Areca nut crop nor returned Rs.7 lakhs and thereby cheated him. One more important aspect which is noteworthy is that in the complaint, the complainant has nowhere stated that accused has harvested the Areca nut crop. On this aspect during his cross-examination, complainant has stated that he has no evidence to show that accused has harvested the Areca nut crop.

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The accused has taken a specific defence that at the time of oral agreement for sale of Areca nut crop complainant has taken a blank cheque. In the complaint,

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it is stated that accused issued the cheque in the month of December by specifying the date 25.04.2016. However, during the course of evidence, the complainant has stated that accused gave the cheque on 20.12.2015. It is pertinent to note that in the subject cheque, the accused has affixed the signature in Kannada and from the manner in which he has affixed signature, it is evident that he do not know writing in English. With regard to the contents of the cheque, the complainant has stated that accused gave the cheque which is already filled up and volunteered that after taking some time, the accused has issued the cheque by writing the date 25.04.2016. When the complainant has failed to prove that accused has taken hand loan and Rs.6,60,000/transferred by him to his account on 01.01.2015 is in respect of the said hand loan, by preponderance of probabilities the accused has proved that at the time of entering into agreement for sale of Areca nut crop accused had issued a blank cheque and not only the complainant has prevented him from harvesting the

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CRL.A NO.1097 OF 2018 11

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Areca nut crop, but also failed to return the cheque and misusing the same he has filed the complaint.

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Considering the oral and documentary

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evidence placed on record, the trial Court has come to a correct conclusion that after the accused rebutted the presumption under Section 139 of the N.I Act, the complainant has failed to prove the allegations against accused and acquitted him. After re-appreciation of the entire material placed on record, this Court finds no justifiable grounds to interfere with the conclusions arrived at by the trial Court. In the result, appeal fails and accordingly the following:

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ORDER

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(i) Appeal filed by the complainant under Section 378(4) of Cr.P.C is hereby dismissed.

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(ii) The impugned judgment and order dated 02.05.2018 in C.C.No.793/2017 on the file of III Addl.Senior Civil Judge and VII

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CRL.A NO.1097 OF 2018 12

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Addl.MACT, Davanagere, is hereby

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confirmed.

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(iii) The Registry is directed to send back the

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trial Court record along with copy of this judgment forthwith.

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Sd/JUDGE

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K Nagaraj v. K S Shivananja Naik

Case brief

What is this about?

What did the court decide?

K Nagaraj v. K S Shivananja Naik

Case brief

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