Partly allowed

Sri M Bhanuprakash v. Sri N Venkatakrishna

Karnataka HC13 Feb 2025CRL.A/203/2015

Case brief

AI extract

What is this about?

High Court allowed criminal appeal partly. Convicted appellant for cheque dishonour (Ex.P2) as defence was unproven but affirmed acquittal for second cheque (Ex.P3) where valid repayment evidence was established.

What did the court decide?

Convicted for cheque Ex.P2, sentenced to fine Rs.50,000+3 months imprisonment; compensation Rs.45,000 orderd. Acquittal for Ex.P3 affirmed.

Sri M Bhanuprakash Vs Sri N Venkatakrishna — Money Laundering | Karnataka HC (2025)

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1 - NC: 2025:KHC:6573 CRL.A No. 203 of 2015

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 13^TH DAY OF FEBRUARY, 2025

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BEFORE

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THE HON'BLE MR JUSTICE SHIVASHANKAR AMARANNAVAR CRIMINAL APPEAL NO. 203 OF 2015

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BETWEEN:

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SRI M BHANUPRAKASH S/O LATE N.R. MAHALINGAPPA, AGED ABOUT 35 YEARS, R/AT: 916, III MAIN, VIJAYANAGAR, BANGALORE 560 040

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…APPELLANT

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(BY SRI. R.A. DEVANANDA, ADVOCATE)

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AND:

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SRI N VENKATAKRISHNA S/O LATE V. NARAYANSWAMY, AGED ABOUT 53 YEARS, R/AT NO.19,N.P. LANE COTTONPET CROSS, BANGALORE 560 053

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…RESPONDENT

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Digitally signed by HEMAVATHY GANGABYRAPPA Location: HIGH COURT OF KARNATAKA

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(BY SRI. B KESHAVAMURTHY .,ADVOCATE -VC)

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THIS CRL.A. IS FILED U/S.378(4) PRAYING TO SET ASIDE THE ORDER DATED:1.1.15, PASSED BY THE 22ND ADDL.CMM, BANGALORE, IN C.C.NO.4793/2012 - ACQUITTING THE RESPONDENT/ACCUSED FOR THE OFFENCE P/U/S 138 OF N.I. ACT.

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

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CORAM: HON'BLE MR JUSTICE SHIVASHANKAR AMARANNAVAR

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2 - NC: 2025:KHC:6573 CRL.A No. 203 of 2015

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ORAL JUDGMENT

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This appeal is filed by the complainant challenging the judgment of acquittal dated 01.01.2015 passed in C.C.No.4793/2012 by the XXII Additional Chief Metropoliton Magistrate, Bengaluru, whereunder the respondent - accused has been acquitted for offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as 'N.I. Act' for brevity).

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The case of the appellant - complainant in brief, is as under:

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The respondent –accused is civil contractor and he is acquainted with the appellant –complainant since 3-4 years. The respondent –accused borrowed Rs.1,25,000/from the appellant –complainant during March -2011. In order to repay the amount borrowed he has issued two cheques baring No,760887 dated 11.07.2011 drawn on Karnataka Bank Limited, K.G Road Branch for Rs.25,000/and another cheque nearing No.597789 drawn on State

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Bank Of Mysuru, Bengaluru Branch dated 10.08.2011 for a sum of Rs.1,00,000/-. The appellant –complainant presented the said cheques for encashment and the said cheques came to be dishonoured for want of funds in the account of the respondent –accused. The appellant - complainant got issued legal notice on 23.08.2011. The said notice served on the respondent –accused. The respondent –accused has sent reply to the said legal notice but did not pay the amount of two cheques. Therefore, the complainant has filed a private complaint against the respondent - accused for offence punishable under Section 138 of the NI Act.

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Learned Magistrate has taken cognizance against the respondent –accused and registered case in C.C.No.4793/2012 for offence punishable under Section 138 of the N.I Act. The plea of respondent - accused has been recorded. The complainant in order to prove his case has examined himself as P.W.2 and got marked documents as Ex.P1 to P11. The statement of respondent -

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accused came to be recorded under Section 313 of Cr.P.C. The respondent –accused has examined himself as D.W.1

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and got marked documents as Ex.D1 to D4. Learned Magistrate after hearing arguments on both sides has formulated points for consideration and passed impugned judgment of acquittal. The said judgment of acquittal has been challenged by the complainant in this appeal.

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Heard learned counsel for the appellant and learned counsel for the respondent.

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Learned counsel for the appellant would contend that the respondent –accused has admitted his signature on cheques -Ex.P2 and P3 and therefore, the presumption under Section 139 of the N.I Act requires to be drawn. The respondent –accused has taken up his defence that he had borrowed money from the father of the appellant –complainant and has issued cheque as security and they were misused by the appellant – complainant. The respondent –accused has not established the said defence. Therefore, the presumption drawn under Section 139 of N.I Act is not rebutted.

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Learned Magistrate harped upon different ink used in writing cheque and even though writing contents of the cheque has been admitted by the respondent –accused in his evidence. The respondent –accused has taken up contrary defences in his reply –Ex.P9 and in his evidence. Without considering all these aspects, learned Magistrate erred in acquitting the respondent –accused for offence punishable under Section 138 of the N.I Act. With these, he prays to allow the appeal and convict the respondent – accused for offence punishable under Section 138 of the N.I. Act.

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Learned counsel for the respondent –accused would contend that it is specific defence of the respondent –accused that he has borrowed amount of Rs.20,000/from the father of the appellant –complainant and he has repaid the same by sending Demand Draft(hereinafter referred to as “DD” for brevity) a copy of which is at Ex.D3 and same has been sent with a letter –Ex.D1 dated 10.12.2010 under certificate of posting –Ex.D2. The DD

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referred in Ex.D1 has been encashed by the father of the appellant –complainant and same is established by letter of Karnataka Bank Limited dated 15.10.2014 which is at Ex.D4. The respondent –accused has established his defence that the cheques have been given as security to the father of the appellant –complainant have been misused by the appellant –complainant. Considering the same, learned Magistrate has rightly acquitted the respondent –accused for offence punishable under Section 138 of the N.I Act. With these, he prays for dismissal of the appeal.

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Having heard learned counsels, the Court has perused the impugned judgment and trial Court records. Considering the grounds urged, the point arises for my consideration is

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“Whether learned Magistrate has erred in passing the judgment of acquittal of respondent –accused for offence punishable under Section 138 of N.I. Act.”?

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My answer to the above point is in the partly in the affirmative for the following reasons.

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There are two cheques involved in the present case and they are as under:

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1. Cheque bearing No.760887 - Ex.P2 dated 11.07.2011 for Rs.25,000/- drawn on Karnataka Bank Limited.

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1. Cheque bearing No.597789 - Ex.P3 dated 10.08.2011 for Rs.1,00,000/- drawn on State Bank of Mysuru, Bengaluru Branch.

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The respondent –accused has not disputed his signature on cheques –Ex.P2 and P3. The respondent – accused on receipt of legal notice sent by the appellant – complainant as per Ex.P6 has got issued reply dated 08.09.2011 which is at Ex.P9. In reply -Ex.P9, the respondent –accused has put forth his defence and it is at para No.6 which reads as under

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“6. Our client inform us that in fact your client father N.R.Mahalingam and himself are the good friends and earlier they had got certain transactions and our client had borrowed certain amount during 2008 from him and as security tendered the cheque

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bearing No.597789 to him. Our client further states that under various dates and finally on 10.12.2010 he has discharged his liability and your clients father also assured that he will return the cheque after some time as he was suffering from ill health. There afterwards your clients father since demised our client requested your client to return the cheque but your client assured that he will return the instrument as the same was not traceable. Our client further informs us that since your client has spent huge amount for medical treatment towards his father he has requested for financial assistance and by considering long time association with your clients father he has obliged to issue the cheque bearing No.760887 to him and later our client has paid the amount by way of cash and requested to return the instruments. But your client has by advancing one or the other pretext has delayed the things and later resorted to take the assistance of goonda elements and also threatened our client. By receiving the present notice our client has been shocked and astonished.”

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As per the said defence, cheque –Ex.P3 has been issued as security to the father of the appellant – complainant when the respondent –accused has availed loan from the father of the appellant –complainant. Cheque –Ex.P2 has been issued by the respondent – accused to the complainant to lend money to him as he

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was need of money for treatment of his father. Considering the said defence put forth in reply notice, the respondent –accused has taken different defences for cheques which are at EX.P2 and P3.

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The respondent –accused who has been examined as D.W.1 has stated in his chief examination that he had given cheques as security to the amount borrowed in sum of Rs.20,000/- from the father of the appellant –complainant. The said defence by D.W.1 in his evidence is partly contrary to the defence taken in para No.6 of his reply notice. Ex.D1 is letter dated 10.12.2010 stated to have been sent by the respondent –accused to the father of the appellant –complainant along with DD for Rs.20,000/- dated 10.12.2010 a copy is at Ex.D3. The

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said letter and DD have been sent to the father of the appellant –complainant under certificate of positing and certificate of posting is at Ex.D2. On perusal of posting seal the said cover addressed to the father of the appellant –complainant has been posted on 13.12.2010. Ex.D4 is letter of the Karnataka Bank wherein it is stated that DD No.559453 dated 10.12.2010 for Rs.20,000/- favouring Mr. N.R Mahalingam was paid on 14.12.2010. The said DD has been referred in Ex.D1. When these documents Ex.D1 to 4 are put to P.W.1 in his cross examination, he has shown his ignorance stating that he do not know regarding them. In Ex.D1 there is specific mention regarding cheque bearing No.597789 of State Bank of Mysuru, Bengaluru Branch seeking its return from the father of the appellant –complainant. The said cheque is at Ex.P3. Considering Ex.D1 to 4 and evidence on record, the respondent –accused has established his defence that the cheque –Ex.P3 has been given as security to the father of the appellant –complainant when he borrowed money from him. Considering the said aspect the respondent –

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accused has rebutted the presumption drawn under Section 139 of the N.I Act with regard to cheque –Ex.P3. The appellant –complainant has not established his case with regard to cheque –Ex.P3.

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The defence of the respondent –accused with regard to cheque Ex.P2 is that he has issued it to the appellant –complainant to lend Rs.25,000/- to the appellant –complainant in order to meet medical expenses of his father. It is his case that subsequently he paid the said amount of Rs.25,000/- in cash and complainant has not returned the said cheque. The said defence has been put forth by the respondent –accused in para No.6 of reply notice -Ex.P9. The said defence has not been stated by the respondent –accused in his evidence. In evidence D.W.1 –accused has stated that that he has given signed cheques as security to the father of the appellant – complainant. The respondent –accused has taken contrary defence with regard to cheque –Ex.P2. The defence taken up by the respondent –accused with regard to Ex.P2 has not been established. Therefore, the

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presumption drawn under Section 139 of the N.I. Act with regard to cheque -Ex.P2 that it has been issued for discharge of debt remained unrebutted. As the respondent –accused has failed to rebut the presumption drawn under Section 139 of the N.I Act with regard to cheque –Ex.P2 has to be convicted for offence punishable under Section 138 of the N.I Act if ingredients of that offence are satisfied. Cheque –Ex.P2 has been dishonoured for want of funds in the account of the respondent –accused. The bank memo is at Ex.P4 and it is dated 13.08.2011. The appellant –complainant has got issued notice –Ex.P6 dated 24.08.2011 demanding payment of amount of cheques. The said notice is within statutory period. The notice has been served on the respondent –accused and he has issued reply notice as per Ex.P9. The cheque amount has not been paid by the respondent –accused within 15 days from the date of receipt of demand notice. The appellant –complainant presented the complaint within statutory period from the date of cause of action. Therefore, the respondent –

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accused requires to be convicted for offence punishable under Section 138 of the N.I Act with respect to Ex.P2 – cheque. The respondent –accused requires to be acquitted for offence punishable under Section 138 of the N.I Act with respect to Ex.P3 –cheque.

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For the aforesaid reasons, the following

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ORDER

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i) The appeal is allowed in part.

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ii) The acquittal of the respondent –accused for offence punishable under Section 138 of the N.I Act in respect of Ex.P3 –cheque is affirmed.

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iii) The acquittal of the respondent –accused for offence punishable under Section 138 of the N.I Act in respect of Ex.P2 –cheque is set aside and he is convicted for offence punishable under Section 138 of the N.I Act and is sentenced to pay fine of Rs.50,000/(Rupees Fifty Thousand only) and in default

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of payment of said fine amount he shall undergo simple imprisonment for a period of three months.

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iv) Out of the fine amount Rs.45,000/-(Rupees Forty Five Thousand Only) is ordered to be paid as compensation to the appellant – complainant.

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v) The respondent –accused shall deposit the said fine amount within two months from this day.

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Sd/(SHIVASHANKAR AMARANNAVAR) JUDGE

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DSP

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List No.: 1 Sl No.: 49

Sri M Bhanuprakash v. Sri N Venkatakrishna

Case brief

What is this about?

What did the court decide?

Sri M Bhanuprakash v. Sri N Venkatakrishna

Case brief

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