Dismissed¶86

Sunanda W/O Shivanand Rotti v. Mallappa S/O Basappa Ingalagi

Karnataka HC19 Jun 2025CRL.A/100287/2017

Case brief

AI extract

What is this about?

Section 138 NI Act; Section 378(4) CrPC appeal by complainant against acquittal; acquittal affirmed; rebuttal of presumptions under Sections 118 and 139 NI Act by probable defence; demand draft counterfoils Ex.D1–D6; complaint silent on date and month of loan; acknowledgment receipt corrected from 2005 to 2008; non-interference with acquittal where plausible view taken; cheque No.5376284 dated 25.02.2009 dishonoured funds insufficient; Dharwad Bench; Bagalkote; C.C.No.420/2010; Crl.A.No.92/2014; appeal dismissed.

What did the court decide?

It is settled law that an appellate court shall not interfere with a judgment of acquittal unless the view taken is not a plausible one; the First Appellate Court having taken a plausible view, the point framed was answered in the affirmative, i.e., the acquittal was justified. ¶78

Sunanda W/O Shivanand Rotti Vs Mallappa S/O Basappa… — Cheque Dishonour | Karnataka HC (2025)

What the court decided

AI extract

Outcome

Dismissed

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Issue for consideration

Whether the First Appellate Court is justified in acquitting the accused for the offence punishable under Section 138 of the N.I. Act by setting aside the judgment of conviction and sentence passed by the trial court in C.C.No.420/2010? +1 more

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Court's answer

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Ratio / Principle

There were no good grounds to interfere with the acquittal judgment passed by the First Appellate Court; consequently the criminal appeal was dismissed.

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Key takeaways

The accused rebutted the initial presumptions under Sections 118 and 139 of the N.I. Act by placing Ex.D1 to Ex.D8 and oral evidence.ratio¶78
The accused's defence was probable: he claimed a hand loan of ₹50,000/- taken in 2005 and repaid (₹44,000/- by demand drafts per counterfoils Ex.D1–D6 and the balance ₹6,000/- in cash); the complaint disclosed no date or month of advancing the loan, and the acknowledgment receipt placed with the complaint bore a correction changing the year from 2005 to 2008.ratio¶72
Neither the complaint nor the legal notice (Ex.P4) contained any averment of financial dealings between the parties from 2003 onwards or of a fresh loan of ₹50,000/- in 2008, which undermined the complainant's case.

Detailed headnote1 paragraphs

High Court of Karnataka, Dharwad Bench (Rajesh Rai K, J.), 19.06.2025 — CRL.A No.100287 of 2017: Complainant's appeal under S.378(4) Cr.P.C. against an acquittal in a S.138 N.I. Act case (cheque No.5376284 dated 25.02.2009 for ₹50,000/- on Dena Bank, Dharwad, dishonoured for 'funds insufficient') dismissed. The trial court (Addl. Civil Judge & JMFC, Bagalkot, C.C.No.420/2010, judgment dt.18.10.2014) had convicted the accused and sentenced him to six months simple imprisonment and Rs.75,000/- fine; the First Appellate Court (Prl. District & Sessions Judge, Bagalkote, Crl.A.No.92/2014, dt.03.07.2017) had acquitted him. Held: (i) an appellate court shall not interfere with an acquittal where a plausible view has been taken, and the First Appellate Court had taken a plausible view; (ii) the accused rebutted the presumptions under S.118 and S.139 N.I. Act by a probable defence — a hand loan allegedly taken in 2005 and repaid (₹44,000/- by demand drafts, counterfoils Ex.D1–D6, balance ₹6,000/- cash), silence in the complaint on the date/month of the alleged 2008 loan, and an acknowledgment receipt corrected from 2005 to 2008; neither the complaint nor notice Ex.P4 averred dealings from 2003 or a fresh 2008 loan. Point framed answered in the affirmative; appeal dismissed.

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HC-KAR

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IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 19^TH DAY OF JUNE, 2025

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BEFORE

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THE HON'BLE MR. JUSTICE RAJESH RAI K

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CRIMINAL APPEAL NO.100287 OF 2017 (A)

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BETWEEN:

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SUNANDA W/O. SHIVANAND ROTTI, AGED ABOUT 44 YEARS, OCC. BUSINESS AND HOUSEWIFE, R/O. KAMBLI GALLI, BAGALKOTE, DIST. BAGALKOTE.

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…PETITIONER

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(BY SRI. VIJAY S. CHINIWAR, ADVOCATE)

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AND:

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MALLAPPA S/O. BASAPPA INGALAGI, AGED ABOUT 69 YEARS, OCC. PENSIONER, R/O. CHANNABASAVAKRUPA BUILDING, SUB-JAIL ROAD, SAIDAPUR, DHARWAD, DIST. DHARWAD.

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Digitally signed byYASHAVANT YASHAVANT NARAYANKAR NARAYANKAR Date: 2025.06.21 11:50:31 +0530

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(BY SRI. S.N. BANAKAR, ADVOCATE)

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…RESPONDENT

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THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378 (4) OF CR.P.C., SEEKING TO CALL FOR RECORDS AND TO SET ASIDE THE JUDGMENT AND ORDER DATED 03.07.2017 PASSED BY PRL. DISTRICT AND SESSIONS JUDGE, BAGALKOTE IN CRL. APPEAL NO. 92 OF 2014 AND TO CONFIRM THE JUDGMENT AND ORDER DATED 18.10.2014 PASSED BY THE ADDL. CIVIL JUDGE AND JMFC BAGALKOTE IN C.C.NO. 420 OF 2010 FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF N.I. ACT.

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THIS APPEAL, COMING ON FOR FINAL HEARING THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

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CORAM: THE HON'BLE MR. JUSTICE RAJESH RAI K

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HC-KAR

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ORAL JUDGMENT

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(PER: THE HON'BLE MR. JUSTICE RAJESH RAI K)

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In this appeal the appellant/complainant has assailed the judgment of acquittal dated 03.07.2017 in Crl.A.No.92/2014 passed by the Principal District and Sessions Judge, Bagalkot (hereinafter referred to as the 'First Appellate Court'), whereby the learned First Appellate Court allowed the appeal filed by the accused and acquitted him for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short 'N.I. Act') by setting aside the judgment of conviction and sentence dated 18.10.2014 in C.C.No.420/2010 passed by the Additional Civil Judge and JMFC, Bagalkot (hereinafter referred to as the ‘learned Magistrate').

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For the sake of convenience, the parties are referred to as per their rankings before the trial Court.

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HC-KAR

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The abridged facts of the case are as under:

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The complainant and the accused are known to each other. The accused was in need of money for his family necessities and he approached the complainant in the year 2008 for financial assistance of ₹50,000/- . Based on the request, the complainant advanced an amount of ₹50,000/- to the accused by way of cash. The accused executed a document i.e. acknowledgment receipt for obtaining the said amount. After few days, the complainant demanded to repay the said amount. However, the accused failed to repay the loan amount and finally he issued a cheque dated 25.02.2009, bearing No.5376284, drawn on Dena Bank, Dharwad Branch for a sum of ₹50,000/- . The said cheque was presented by the complainant for encashment through her banker i.e. State Bank of India, Bagalkot Branch. However, the said cheque was dishonoured for the reason ‘funds insufficient’ and an endorsement to that effect was issued by the Bank. The said aspect was intimated by the complainant to the

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HC-KAR

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accused through legal notice dated 21.03.2009. The said legal notice was served on the accused and he replied to it by denying the averments made in the legal notice. Thereafter, left with no other option, the complainant filed a private complaint under Section 200 of Cr.P.C., before the learned Magistrate against the accused for the offence punishable under Section 138 of the N.I. Act.

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To prove the case before the trial Court, the complainant herself examined as PW.1 and got marked 11 documents as Exs.P1 to P11. The accused also examined himself as DW.1 and got marked 8 documents as Ex.D1 to Ex.D8.

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On assessment of oral and documentary

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evidence, the learned Magistrate convicted the accused for the offence punishable under Section 138 of N.I Act and ordered as follows:

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HC-KAR

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“ORDER

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Acting U/sec.255(2) of Cr.P.C., accused is hereby convicted for the offence punishable U/Sec.138 of Negotiable Instruments Act.

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The accused is sentenced to undergo simple imprisonment for six months and also sentenced to pay fine of Rs.75,000/- (Rs. Seventy Five Thousand Only). In default to payment of fine amount, he shall undergo Simple Imprisonment for Thirty days.

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Out of fine recovered U/Sec.357 of Cr.P.C., a sum of Rs.70,000/- (Rs.Sevnety thousand only) shall be paid to complainant, which includes the Cheque amount and also cost of the proceedings.

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The bail bond and surety bond of the accused stands cancelled.”

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Aggrieved by the same, the accused preferred the appeal before the First Appellate Court in Crl.A.No.92/2014.

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HC-KAR

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On reassessment of the evidence on record, the

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First Appellate Court allowed the appeal and set aside the judgment of conviction and sentence passed by the learned Magistrate and acquitted the accused for the offence punishable under Section 138 of the N.I. Act. The said judgment of the First Appellate Court is under challenge in this appeal.

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Heard the learned counsel Sri. Vijay S Chinivar for the appellant-complainant and the learned counsel Sri.S.N.Banakar, for the respondent-accused.

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The primary contention of the learned counsel for the appellant-complainant is that the First Appellate Court has grossly erred in allowing the appeal by setting aside the judgment of conviction and sentence passed by the trial Court. He contended that the oral and documentary evidence on record clearly proves the monitory transaction between the accused and the complainant and the issuance of cheque in question by the

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HC-KAR

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accused, despite the First Appellate Court has acquitted the accused for the reason that the complainant has failed to establish the legally recoverable debt and the accused has rebutted the initial presumption available under Section 118 and 139 of the N.I. Act. As such, the judgment passed by the First Appellate Court is erroneous and against the settled principle of law. Accordingly, he prays to set aside the judgment of acquittal and to uphold the judgment of conviction passed by the trial Court.

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Per contra, learned counsel appearing for the respondent-accused contended that the judgment challenged in this appeal does not suffer from any perversity or illegality. He further contended, the First Appellate Court after meticulously examining the entire evidence and documents on record, has passed the well reasoned judgment by setting aside the judgment of conviction and sentence passed by the trial Court. He contended that in the evidence of the accused, it is clearly stated that he had obtained a hand loan of ₹50,000/- from

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HC-KAR

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the complainant in the year 2005 and it was repaid subsequently from the year 2005 to 2006 through Demand Drafts. The counterfoils of Demand Draft Forms were marked at Ex.D1 to Ex.D6. Further, he also contended that in the complaint, the complainant has failed to state the date and month of advancing the hand loan of ₹50,000/- to the accused. In such circumstances, according to him, the Appellate Court has rightly set aside the judgment of conviction and sentence passed by the trial Court and acquitted the accused for the offence under Section 138 of the N.I. Act. Accordingly he prays to dismiss the appeal.

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Having heard the learned counsel for the parties and on perusal of the entire material available on record, the only point that would surface for my consideration is:

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“Whether the First Appellate Court is justified in acquitting the accused for the offence punishable under section 138 of the N.I. Act by setting aside the

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HC-KAR

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judgment of conviction and sentence passed by the trial court in C.C.No.420/2010?

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I have given my anxious consideration to the arguments advanced by both the learned counsel and perused the materials on record.

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On careful scrutiny of the evidence available on record, it could be gathered that the cheque in question and the signature of the accused on it is not seriously disputed by the accused. It is the specific defence of the accused that he had obtained a hand loan of ₹50,000/from the complainant in the year 2005 to perform the marriage of his daughter and subsequently in the year 2005 and 2006 he repaid the said loan in installments. To substantiate the said defence, the accused placed the counterfoils Demand Draft Forms as per Ex.D1 to Ex.D6.

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On careful perusal of the complaint filed by the complainant before the Trial Court, as rightly contended by the learned counsel for the accused, nowhere the date and

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HC-KAR

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month of advancing the loan amount to the accused are forthcoming. However, it is stated that the cheque in question was issued in the year 2009 as per Ex.P1. Further, it is stated in the complaint that the accused executed a document acknowledging receipt of hand loan obtained by him. Though the said document was not marked in the evidence, the same was placed by the complainant along with the complaint. On perusal of the said document, it could be seen, a correction was carried out by changing the year from 2005 to 2008. It is the specific defence taken by the accused that he had obtained the hand loan in the year 2005, and as a security for the said loan amount, he had issued cheque in question and the said receipt to the complainant. Though the said hand loan was repaid by the accused in the year 2005 and 2006, the complainant did not return the said cheque to the accused and later in the year 2009, she presented the said cheque for unlawful gain. The said defence of the accused is forthcoming even in the reply

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HC-KAR

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notice Ex.P7. Further, on careful perusal of Ex.D1 to Ex.D6, the counterfoil Demand Draft Forms, it reveals that the accused has paid a sum of ₹44,000/- on different dates to the complainant by way of demand drafts. It is the case of the accused that the remaining amount of ₹6,000/- was paid by the accused by way of cash. It is vehemently contended by the learned counsel for the complainant that though the accused had obtained a hand loan of ₹50,000/- in the year 2003 to 2005 and after repaying the same, again borrowed hand loan of ₹50,000/- from the complainant and to repay the same, he issued the cheque in question (Ex.P1). However, on careful perusal of the complaint and the legal noticeEx.P4, there is no such averment forthcoming that there was financial transaction between the complainant and the accused ever since from the year 2003 and the accused had obtained a hand loan in the year 2005 and repaid the same and subsequently, he obtained loan of ₹50,000/- in the year 2008.

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HC-KAR

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No doubt the initial presumption under Section 118 and 139 of the N.I.Act favours the complainant. In such circumstances, the defence put forth by the accused is a probable one. No doubt, the initial presumption arise under Section 118 and 139 of the N.I. Act favours the accused, nevertheless the same can be rebutted by placing probable defence by the accused as held by this Court and the Hon’ble Apex Court in catena of judgments. In the instant case, the accused has rebutted the initial presumption by placing Ex.D1 to Ex.D8 documents and oral evidence. Further, this appeal is against the judgment of acquittal and it is settled position of law that the Appellate Court shall not interfere with the acquittal judgment unless the trial Court had not taken a plausible view. In the instant case, the First Appellate Court has taken a plausible view. Under such circumstances, I find no good grounds to interfere in the acquittal judgment passed by the First Appellate Court. In that view of the

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