Sri.Bhavan Gowda Vs Sri.Madhu A.S — Cheque Dishonour | Karnataka HC (2025)

Sri.Bhavan Gowda Vs Sri.Madhu A.S — Cheque Dishonour | Karnataka HC (2025)

What the court decided

AI extract

Outcome

Appeal allowed; impugned order of acquittal set aside and matter remitted back to the Trial Court to consider the matter on merits with all contentions of the parties kept open; parties directed to appear before the Trial Court on 25.04.2025 without separate notice; Trial Court directed to dispose of the matter within two months.

Issue for consideration

Whether the Trial Court was justified in acquitting the accused solely because the demand notice under Section 138(b) was issued beyond 30 days of receipt of the bank's information, when Ex.P2 (bank endorsement) bears print date 30.03.2019 though its return date is 27.03.2019.

Court's answer

The Trial Court did not consider the matter on merits and acquitted the accused merely on the ground of technicality.

Ratio / Principle

The Trial Court ought to have taken note of Ex.P2, wherein the print date is mentioned as 30.03.2019 though the return date is mentioned as 27.03.2019; the Trial Court's approach is therefore erroneous.

Key takeaways

The impugned order of acquittal, passed only on the ground that proceedings were initiated after the prescribed period under Section 138(b), is erroneous and is set aside.ratio¶38

Detailed headnote1 paragraphs

Negotiable Instruments Act, 1881 — Section 138(b) — 30-day notice period — Criminal Appeal under Section 378(4) CrPC against acquittal in C.C.No.3451/2019 — Trial Court acquitted the accused solely because the demand notice was issued after the prescribed time (notice issued after 32 days of receipt of bank information, one day excluded per General Clauses Act) — Appellant contended Ex.P2 bank endorsement, though bearing return date 27.03.2019, was communicated/bore print date 30.03.2019 — High Court held the Trial Court did not consider the matter on merits, acquitted on a technicality, and erred in ignoring Ex.P2's print date of 30.03.2019 — Acquittal order held erroneous and set aside — Appeal allowed; matter remitted to the Trial Court for decision on merits with contentions kept open; parties to appear on 25.04.2025; disposal directed within two months (H.P. Sandesh, J.).

1 -

NC: 2025:KHC:11625 CRL.A No. 2204 of 2024

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 20^TH DAY OF MARCH, 2025

BEFORE

THE HON'BLE MR JUSTICE H.P.SANDESH

CRIMINAL APPEAL NO. 2204 OF 2024

BETWEEN:

SRI. BHAVAN GOWDA S/O LATE BETTE GOWDA AGED ABOUT 40 YEARS R/O NO.7/1A, AMRUTH MUNERALS PANTHARAPALYA, MYSURU ROAD BENGALURU-560 026.

…APPELLANT

(BY SRI. K.R. LINGARAJU, ADVOCATE)

AND:

Digitally signed by DEVIKA M Location: HIGH COURT OF KARNATAKA

SRI. MADHU A.S., S/O SHAMBULINGE GOWDA AGED ABOUT 41 YEARS R/O NO.57, MUNESHWARA NAGARA 1^ST CROSS, BOMMANAHALLI (NEARBY) OLD NAGAMMANNAPALYA ALSO AVAILABLE AT NEAR GOODWILL GARMENTS OLD MANGAMMANAPALYA BENGALURU-560 065.

…RESPONDENT

(BY SRI. K.R.LAKSHMINARAYANA RAO, ADVOCATE)

THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378(4) OF CR.PC (FILED U/S 419(4) BNSS) PRAYING TO SET ASIDE THE JUDGMENT IN C.C.NO.3451/2019 DATED 21.10.2024 PASSED BY THE XII ADDL. JUDGE COURT OF SMALL CAUSES AND ADDL.C.J.M, BENGALURU AND ALLOW THE CRIMINAL CASE NO.3451/2019 AS PRAYED FOR.

2 -

NC: 2025:KHC:11625 CRL.A No. 2204 of 2024

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

CORAM: HON'BLE MR. JUSTICE H.P.SANDESH

ORAL JUDGMENT

This matter is listed for admission. I have heard learned counsel for appellant and learned counsel for the respondent.

This appeal is filed challenging the order of acquittal

of the accused for the offence under Section 138 of N.I. Act in C.C.No.3451/2019.

The factual matrix of the case of complainant before

the Trial Court is that accused is the friend of the complainant and on the basis of the said acquaintance, the accused had borrowed money of Rs.6,00,000/- on 26.03.2019 from the complainant and he also promised to pay the amount within six months and failed to repay the amount to the complainant. When the complainant demanded to repay the amount, the accused has issued cheque dated 26.03.2019 and when the cheque was presented, the same was returned with an endorsement ‘insufficient funds’ on 27.03.2019. Hence, legal notice was issued and the accused did not come forward to

3 - NC: 2025:KHC:11625 CRL.A No. 2204 of 2024

make the payment. Hence, complaint was filed and cognizance was taken, the accused was secured and he did not plead guilty.

In order to prove his case, the complainant examined himself as P.W.1 and got marked the documents as Exs.P1 to P10. The accused examined himself as D.W.1, but not marked any document.

The Trial Court having considered the material on record, acquitted the accused only on the ground that proceedings was initiated after the prescribed time i.e., after 31 days of receipt of endorsement from the bank. As per Section 138(b), the payee or the holder in due course of the Cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the Cheque, within 30 days of the receipt of information by him from the bank regarding the return of the Cheque as unpaid. But, in this case, the complainant has issued notice after 32 days of the receipt of the information, as per General Clauses Act, there was one day delay, if it is excluded. Hence, the accused is entitled for acquittal.

4 -

NC: 2025:KHC:11625 CRL.A No. 2204 of 2024

Learned counsel for the appellant brought to notice of this Court Ex.P2-endorsement issued by the bank and though it was returned, the communication was made only on 30.03.2019 not on 27.03.2019 and Trial Court failed to consider the same and brought to notice of this Court the print date mentioned as 30.03.2019 and reasoning assigned by the Trial Court is not correct.

Per contra, learned counsel for the respondent would contend that in the document itself, it is mentioned as memo dated 27.03.2019 and there is no pleading to the effect that the same was communicated on 30.03.2019 and Trial Court has not committed any error.

Having heard learned counsel for the appellant and learned counsel for the respondent and also taking note of the material on record, the Trial Court has not considered the matter on merits and acquitted the accused on the ground of technicality and the Trial Court ought to have taken note of document at Ex.P2, wherein the print date is mentioned as 30.03.2019 though it is mentioned return date as 27.03.2019 and the very approach of the Trial Court is erroneous and

5 - NC: 2025:KHC:11625 CRL.A No. 2204 of 2024

matter requires interference with regard to the finding of the Trial Court and the impugned order of acquittal of the accused is passed only on the ground that proceeding was initiated after prescribed period as provided under Section 138(b) which is erroneous and the same is set aside. Hence, I pass the following:

ORDER

(i) The appeal is allowed.

(ii) The impugned order is set aide and matter is remitted back to the Trial Court to consider the matter on merits. All the contentions of the parties are kept open.

(iii) The parties are directed to appear before the Trial Court on 25.04.2025 without expecting any separate notice.

(iv) The Trial Court is directed to dispose of the matter within two months from today, since matter has to be considered on merits.

Sd/(H.P.SANDESH) JUDGE

ST

List No.: 1 Sl No.: 44