Dismissed

Sri G Gopala Krishna v. Sri S Senthikumar

Karnataka HC6 Feb 2025CRL.A/714/2015

Case brief

AI extract

What is this about?

The High Court of Karnataka in a criminal appeal filed under Section 378 Cr.P.C dismissed the appeal of a complainant who sought to challenge the acquittal of the accused. The accused was acquitted of cheque dishonour under Section 138 NI Act as the statutory presumption under Section 139 was rebutted because the presented cheque was a blank transferred one for an old debt to a third party, not th

What did the court decide?

The appeal was dismissed as there were no grounds for allowing it.

Sri G Gopala Krishna Vs Sri S Senthikumar — Cheque Dishonour | Karnataka HC (2025)

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1 - NC: 2025:KHC:5469 CRL.A No. 714 of 2015

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 6^TH DAY OF FEBRUARY, 2025

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BEFORE

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THE HON'BLE MR JUSTICE SHIVASHANKAR AMARANNAVAR

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CRIMINAL APPEAL No. 714 OF 2015

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BETWEEN:

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SRI G GOPALA KRISHNA S/O GANGAIAH AGED ABOUT 36 YEARS RESIDENT OF No. 541 3^RD CROSS, 3^RD MAIN ”A" BLOCK, 2^ND STAGE RAJAJINAGAR BENGALURU - 560 010.

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…APPELLANT

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Digitally signed by LAKSHMINARAYANA MURTHY RAJASHRI Location: HIGH COURT OF KARNATAKA

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(BY SRI A C BALARAJ, ADVOCATE)

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AND:

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SRI S SENTHIKUMAR S/O SRINIVASAN AGED ABOUT 39 YEARS RESIDENT OF No.5 15^TH MAIN, 12^TH CROSS KURUBARAHALLI BENGALURU - 560 086.

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…RESPONDENT

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(BY SRI CHANDRAHASA RAI B, AND SRI N CHANAKRISHNAPPA, ADVOCATES)

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THIS CRL.A. IS FILED UNDER SECTION 378(4) Cr.P.C PRAYING TO SET ASIDE THE ORDER DATED 23.05.2015, PASSED BY THE XXII A.C.M.M., BANGALORE IN C.C.No.14279/2014-ACQUITTING THE RESPONDENT/ACCUSED

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FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF N.I. ACT AND ETC.,

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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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ORAL JUDGMENT

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This appeal is filed by the appellant – complainant challenging the judgment of acquittal dated 23.05.2015 passed in C.C.No.14279/2014 by the XXII Additional Chief Metropolitan Magistrate, Bengaluru, whereunder the respondent – accused has been acquitted of the offence under Section 138 of the N.I.Act .

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Case of the appellant – complainant in brief is as under;

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The respondent – accused is known to the appellant – complainant since several years and during April, 2012, the respondent – accused approached the appellant – complainant for the financial assistance of Rs.2,50,000/- in order to clear some urgent debt, legal business and family necessities. Considering the request of the respondent –

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accused, the appellant – complainant paid a sum of Rs.2,50,000/- on 15.04.2012 by way of cash and at the time of receipt of the amount, the respondent – accused agreed to repay the said loan within ten months or at the earliest. The appellant – complainant approached the respondent – accused and demanded for repayment of the said amount borrowed. The respondent – accused issued the cheque bearing No.041398 dated 30.03.2013 for a sum of Rs.2,50,000/- drawn on I.C.I.C.I Bank, Jayanagar Branch, Benglauru. The appellant – complainant presented the said cheque for encashment and it came to be dishonoured with a shara “Account closed” . The appellant – complainant got issued the legal notice on 29.04.2013 calling upon the respondent – accused to pay the cheque amount. On service of the said notice, the respondent – accused did not pay the cheque amount, but he had issued the reply denying the claim of the appellant – complainant. As the cheque amount is not paid, the appellant – complainant presented a private complaint against the respondent – accused for the offence under

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NC: 2025:KHC:5469 CRL.A No. 714 of 2015

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Section 138 of the N.I.Act. Learned Magistrate took cognizance and registered C.C.No.14279/2014 against the respondent – accused for the offence under Section 138 of the N.I.Act. The plea of the respondent – accused had been recorded. The appellant – complainant in order to prove his case has examined himself as PW1 and got marked Exs.P1 to P6. The statement of the respondent – accused had been recorded under Section 313 of Cr.P.C. The respondent – accused examined himself as DW1 and has not got marked any document on his side. The learned Magistrate after hearing the arguments on both sides has formulated the points for consideration and passed the impugned judgment of acquittal. The said judgment of acquittal has been challenged by the appellant – complainant in this appeal.

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Heard learned counsel for the appellant –

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complainant. Learned counsel for the respondent – accused is absent.

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Learned counsel for the appellant – complainant would contend that the respondent – accused had admitted his signature on Ex.P1 – cheque. As the signature on the cheque has been admitted, a presumption arises under Section 139 of the N.I.Act that the cheque had been issued for making payment of the legally enforceable debt. The said presumption has not been rebutted by the respondent – accused. The respondent – accused has not established his defence that Ex.P1 – cheque had been given as a security to the loan availed by him from the wife of the appellant – complainant. Learned counsel for the appellant – complainant further contended that dishonour of the cheque for the reason “Account closed” also attracts the offence under Section 138 of the N.I.Act, as the said dishonour amounts to dishonour of cheque for want of funds. On the said points, learned counsel for the appellant – complainant placed reliance on the following decisions:

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1. Kalamani tex and Another vs. P Balasubramanian reported in (2021) 5 SCC 283.

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2. NEPC Micon Ltd. And Others Vs. Magma Leasing Ltd., reported in (1999) 4 SCC 253

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3. Sri Kiran Kumar V R vs. Sri T H Umesh held in Crl.A.No.703/2014.”

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On these grounds, learned counsel for the appellant – complainant prayed to allow the appeal and convict the respondent – accused for the offence under Section 138 of the N.I.Act.

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Having heard learned counsel for the appellant – complainant, this Court has perused the impugned judgment and the Trial Court records. Considering the grounds urged, the following point arises for consideration;

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

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My answer to the above point is in the negative, for the following reasons;

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It is the specific case of the appellant – complainant that on 15.04.2012, he had lent Rs.2,50,000/- in cash to the respondent – accused, who had agreed to repay the same within ten months. It is the further case of the appellant – complainant that Ex.P1 – cheque had been issued by the respondent – accused for making the payment of the amount borrowed. The respondent – accused has admitted his signature on the cheque – Ex.P1. As the signature on the cheque is admitted, a presumption under Section 139 of the N.I.Act that the cheque had been issued for making payment of debt requires to be drawn.

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The said presumption is a rebuttable presumption. The standard of proof for rebutting the said presumption is preponderance of probability as held by the Hon’ble Apex Court in the case of Basalingappa Vs. Mudibasappa reported in (2019) 5 SCC pg 418 . In the said case the Hon’ble Apex Court has also held that the inference of preponderance of probability can be drawn not only from the materials brought on record by the parties, but, also

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by reference to the circumstances upon which the respondent – accused relies.

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In the case relied upon by the learned counsel for the appellant – complainant in the case of Kalamani tex and Another vs. P Balasubramanian , the Hon’ble Apex

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Court has held as under;

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“ 13. Adverting to the case in hand, we find on a plain reading of its judgment that the trial Court completely overlooked the provisions and failed to appreciate the statutory presumption drawn under Section 118 and Section 139 of NIA. The Statute mandates that once the signature(s) of an accused on the cheque/negotiable instrument are established, then these ‘reverse onus’ clauses become operative. In such a situation, the obligation shifts upon the accused to discharge the presumption imposed upon him. This point of law has been crystalized by this Court in Rohitbhai Jivanlal Patel v. State of Gujarat in the following words:

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“18. In the case at hand, even after purportedly drawing the presumption under Section 139 of the NI Act, the trial

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court proceeded to question the want of evidence on the part of the complainant as regards the source of funds for advancing loan to the accused and want of examination of relevant witnesses who allegedly extended him money for advancing it to the accused. This approach of the trial court had been at variance with the principles of presumption in law. After such presumption, the onus shifted to the accused and unless the accused had discharged the onus by bringing on record such facts and circumstances as to show the preponderance of probabilities tilting in his favour, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of funds for advancing loan to the appellant- accused.”

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8. It is the specific defence of the respondent – accused

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that he had availed loan of Rs.10,000/- from the wife of the appellant – complainant ie., Smt.C.Anasuyadevi on 27.09.2007 and he had issued Ex.P1 – cheque as a security for the said loan. The said defence has been stated by the respondent – accused in his reply to the

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statutory notice which is at Ex.P6. DW1 / respondent – accused in his chief examination has also stated that he had given Ex.P1 – cheque to Smt.Anasuyadevi in the year 2007 when he had availed loan of Rs.10,000/- from her as a security to the loan amount and it was a blank signed cheque. DW1 / respondent – accused has denied that he had borrowed Rs.2,50,000/from the appellant – complainant. The said defence which is put forth to PW1 in his cross examination, he has denied the same. The cheque said to have been issued by the respondent – accused is at Ex.P1. In the memo issued by the Bank while returning the cheque, the reason for dishonour is “Account closed” and the said memo is at Ex.P2. On Ex.P1 – cheque also, there is crossed mark by the red ink pen and in between it is endorsed with “Account closed on 28.10.2009 ”. The said cheque is dated 30.03.2013. The said account of the respondent – accused has been closed more than three years prior to the date of cheque. The said aspect itself would indicate and buttress the contention of the respondent – accused that the cheque –

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Ex.P1 has been issued as a security to the wife of the appellant – complainant when he had availed loan of Rs.10,000/- from her. The said aspect itself probabilizes the defence of the respondent – accused that blank signed cheque has been given by the respondent – accused to the wife of the appellant – complainant as a security to the loan availed by him from the wife of the appellant – complainant. There is no suggestion to DW1 that he had issued the cheque of the account which is closed and he has cheated the appellant – complainant. The alleged loan was during April, 2012 and the cheque is dated 30.03.2013 and the account has been closed on 28.10.2009. Even the hand writing regarding name of the payee and the amount in words are different. It is suggested in the cross examination of PW1 that the hand writing in Ex.P1 are not that of the respondent – accused and it has been filled up by the appellant – complainant and it has been denied by the appellant – complainant.

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The appellant – complainant is said to have lent

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Rs.2,50,000/- to the respondent – accused by cash. The capacity of the appellant – complainant has been challenged. As the presumption has been rebutted, it is for the appellant – complainant to establish the lending and issue of cheque for discharge of the debt. PW1 in his cross examination has stated that he has availed loan from Syndicate Bank in the year 2011 in a sum of Rs.2,00,000/and he had given his site for rent to a shop and he had got Rs.1,00,000/- in that regard and he had kept that money in his house. PW1 has admitted that he is having the said rental agreement and the document pertaining to the loan availed by him. The said documents are not produced by the appellant – complainant. PW1 has also admitted that mother of the respondent – accused and his wife are close friends. In view of rebuttal of the presumption, it is for the appellant – complainant to prove the alleged lending and his capacity to lend the amount. Therefore, the decision relied upon by him in the case of Sri.Kiran Kumar supra, does not apply to the facts of the case on

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hand. The Hon’ble Apex Court in the case of NEPC Micon Ltd., and others supra, has held that dishonour of the cheque for reason “account closed” also amounts to dishonour of cheque for want of money in the account of the drawer. Even though the endorsement “account closed” also amounts to dishonour of cheque for want of funds, but in the case on hand, the account has been closed more than three years prior to the date of cheque. Considering all these aspects, the learned Magistrate has rightly acquitted the respondent – accused of the offence under Section 138 of the N.I.Act by a reasoned judgment.

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There are no grounds made out for allowing the appeal. In the result, the following;

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ORDER

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The appeal is dismissed .

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Sd/(SHIVASHANKAR AMARANNAVAR) JUDGE

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List No.: 1 Sl No.: 58