IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 25TH DAY OF NOVEMBER, 2019 BEFORE THE HON'BLE MR. JUSTICE H.P. SANDESH CRIMINAL APPEAL No.247/2017 BETWEEN:
MR. ARUN KUMAR S.S.
S/O. SRI. SHANTHAVEERAPPA S.R. AGED ABOUT 38 YEARS R/AT No.FA362 4TH CROSS, 2ND MAIN BEHIND HAL HOSPITAL HAL OLD TOWNSHIP VIMANAPURA POST BENGALURU-560 017. … APPELLANT (BY SRI.CHANDRASHEKAR, ADVOCATE) AND:
SRI. R. PRASAD S/O. SRI. RAJAN NO.FA225, 2ND CROSS 2ND MAIN, HAL OLD TOWNSHIP BEHIND HAL HOSPITAL VIMANAPURA POST BENGALURU-560 017.
ALSO AT SRI. R. PRASAD L304/74131-28 (SHEET METAL DEPARTMENT) LCA DIVISION, VIMANAPURA POST HAL, BENGALURU-560 017.
AND ALSO AT SRI. R. PRASAD C/O. ARVIND R PROPRIETOR OF M/S. YELLO BOX ENTERPRISES No.245/B, 2ND BLOCK 41ST CROSS, 10TH MAIN RAJAJINAGAR BENGALURU-560 010. ... RESPONDENT (BY SRI. IQBAL AHMED KHAN, ADVOCATE – ABSENT) THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378(4) OF CODE OF CRIMINAL PROCEDURE PRAYING TO SET ASIDE THE IMPUGNED JUDGMENT DATED 13.01.2017 PASSED BY THE LVIII ACMM, MAYOHALL UNIT, BENGALURU IN C.C.No.55691/2014 PRODUCED HEREWITH AND MARKED AS ANNEXURE-A AND THEREAFTER CONVICT THE RESPONDENT/ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF N.I. ACT.
THIS CRIMINAL APPEAL COMING ON FOR FURTHER ARGUMENTS THIS DAY, THE COURT DELIVERED THE FOLLOWING:
J U D G M E N T This appeal is filed challenging the judgment of acquittal passed in C.C.No.55691/2014 dated 13th day of January 2017 on the file of LVIII Additional Chief Metropolitan Magistrate, Mayo Hall Unit, Bengaluru.
Brief facts of the case:
2. It is the case of the complainant who is the appellant herein that accused, who was his friend had borrowed a hand loan of Rs.9,70,000/- to set up a business and towards discharge of the said loan amount, the accused had issued a cheque dated 12.6.2014. On presentation of the said cheque for encashment, the same was returned with an endorsement “funds insufficient” on 25.07.2014. Thereafter, legal notice was issued on 31.07.2014 and the same was acknowledged on 04.08.2014. He gave an untenable reply on 20.08.2014. Inspite of the same, the accused did not make the payment. Hence, complaint was filed.
3. The Court below took cognizance of the offence and summons was issued to the accused. In order to substantiate the case of the complainant, he examined himself as P.W.1 and got marked the documents Exs.P1 to P7. Accused was examined under Section 313 of Code of Criminal Procedure. He also led his evidence by examining himself as D.W.1 and no documents were marked.
4. The Court below, after considering both oral and documentary evidence, acquitted the accused for the offence punishable under Section 138 of Negotiable Instruments Act (‘the Act’ for short). Hence, the present appeal is filed.
5. It is contended by the appellant’s counsel in the appeal that the signature on the cheque is not disputed by the accused. When the accused has not disputed the signature on the cheque, the complainant has discharged his burden and there is a presumption that accused is liable to pay the amount. The Court below ought to have shifted the burden on the accused but failed to draw the presumption against the accused. The Court below also failed to take note of the principles laid down by the Hon’ble Apex Court in the case of Rangappa Vs. Sri Mohan reported in (2010) 11 SCC 4413.
6. It is the further contention of the appellant’s counsel that the accused had taken contention that he had issued 20 cheques including the said cheque in favour of one B.P.Girish towards the repayment of his loan of Rs.4,00,000/-. The present complaint is filed at the instance of said B.P.Girish. He stated that the accused has not made any transaction with complainant and the cheque issued in favour of B.P.Girish was misused. In order to substantiate his contention, the accused has not placed any material before the Court and also not examined any witnesses. Hence, the Trial Court ought to have convicted the accused but the Court below has taken the evidence of D.W.1 as the gospel truth and rejected the evidence of the complainant in its toto. Therefore, the Court below has committed an error in acquitting the accused and it requires interference of this Court.
7. Learned counsel would contend that the hand loan of Rs.9,70,000/- was paid to the accused. In order to substantiate his contention with regard to the source of the amount, learned counsel has brought to my notice the reference made in Ex.P.7 for having transferred the amount of Rs.1,50,000/- to the accused. The complainant also withdrew the amount to the tune of Rs.2,61,000/- in the month of May and paid the said amount to the accused. These materials are disregarded by the Court below and the accused has not rebutted the presumption. Inspite of the same, the Court below committed an error in acquitting the accused.
8. Learned counsel in support of his contention relied upon the unreported judgment of this Court passed in Crl.A.No.2109/2017. Referring to the said judgment, learned counsel contended that this Court has observed that the accused ought to have rebutted the contention of the complainant by producing cogent evidence before the Court and mere denial is not enough. He also relied upon the judgment reported in (2018) 8 SCC 165 in the case of KISHAN RAO VS. SHANKARGOUDA regarding presumption under Sections 138 and 139 of the Act. The Apex Court in the said decision has observed that the accused has not rebutted the presumption by leading any evidence. Referring to the said decision, learned counsel contended that the complainant need not prove the source of income to advance the amount once the accused admits his signature available on the cheque. In the present case, the accused has taken a different stand and has not proved the same by adducing any cogent evidence.
9. This Court heard the matter on 11.11.2019 and the learned counsel for the respondent did not choose to appear before the Court. However, in the ends of justice an opportunity was given to the respondent’s counsel and the matter was listed on 18.11.2019. On that day also, the respondent’s counsel did not appear before the Court. However, one more opportunity was given to him and finally the matter is listed today. Today also, learned counsel for the respondent did not choose to appear and address his arguments. Hence, it is taken as no arguments on behalf of the accused.
10. Having heard the arguments of appellant’s counsel and also on perusal of the material available on record, so also keeping in view of the contentions urged by the appellant’s counsel, the points that arise for consideration of this Court are:-
1. Whether the Court below has committed an error in acquitting the accused and it requires interference of this Court ?
2. What Order?
11. Having considered the contentions raised by the appellant’s counsel and also the grounds urged in the appeal memorandum, the main contention of the learned counsel for the appellant/complainant is that the Court below failed to draw the presumption under Section 138 of the Act and the accused did not rebut the evidence of the complainant and thus, the Trial Court has committed an error in acquitting the accused in coming to the conclusion that accused has rebutted the evidence of the complainant.
12. Now, this Court considers the material available on record. On perusal of the complaint at para No.2, the complainant has contended that accused being a friend of complainant has borrowed hand loan of Rs.9,70,000/- from the complainant to set up the business. In repayment, he had issued the subject matter of the cheque. In order to substantiate the same, the complainant examined himself as P.W.1 and got marked documents Exs.P1 to P7. He was subjected to cross examination. In the cross-examination, he admits that he himself and accused both are employees of HAL. He further admits that he was drawing a salary of Rs.20,000/- per month and he is paying the income tax. He did not disclose the payment of Rs.9,70,000/- in his income tax returns. He further admits that he had not mentioned the mode of payment in complaint, legal notice and also in his chief evidence. He admits that if any payment of more than Rs.20,000/- is to be made, the same is to be paid by way of cheque itself under the Income Tax Act. He volunteers that the accused demanded hand loan from him to do the business. He further admits that HAL employees cannot do any business without the prior permission. It is further elicited that he has paid the amount to the accused out of his savings and at that time, he had kept the said amount in his house. He further admits that he has not given any information to his department for having paid the amount to the accused. In order to substantiate his source of income, he was further examined and got marked Exs.P7 and P8. In the further cross examination, he admits that as per Ex.P.7, he paid the amount of Rs.38,000/- to the accused on 11.1.2014. Accused in turn repaid the amount of Rs.10,000/- on 16.04.2014 and Rs.14,000/- on 20.05.2014 and he volunteers that he made the payment only to the tune of Rs.24,000/-.
13. The accused has been examined as D.W.1. In his evidence, he says that he is having acquaintance with the complainant from past five years and both are working for the same company and also there is no financial transaction between them. He claims that he has borrowed the amount from B.P.Girish and in turn, he had given 20 blank cheques for the purpose of repayment of the said loan. Sri.B.P.Girish has filed cheque bounce case against him. He also claims that B.P.Girish through his friends Arunkumar, Ravikumar, Srinath, R.Girish and Chandrashekar filed several cheque bounce cases against him.
The present case is also filed at the instance of the said B.P.Girish but he has not given any cheque to the complainant. The accused was subjected to cross-examination. In the cross- examination, he admits that one R.Arvind is his brother and he was running a mobile shop at Rajajinagar. He also admits that the averments made in para No.5 of his legal notice refers to the business of his brother. He also claims that after the difference arose between him and the said B.P.Girish, he gave notice to him not to make use of those cheques, which he had given to him. He admits that he has no difficulty in producing the said documents before the Court. He admits for having transferred the amount of Rs.1,50,000/- to his account by the complainant. Hence, the relevant entry in the passbook is marked as Ex.P7(a) at the instance of the accused.
14. Having considered both oral and documentary evidence and also keeping in view of the contentions urged by the appellant’s counsel, this Court has to re-appreciate the material available on record. On perusal of notice given by the complainant in terms of Ex.P3, a specific claim has been made by the complainant that the accused borrowed a sum of Rs.9,70,000/- as hand loan to set up the business. Accused in turn had issued the cheque dated 12.06.2014. It is also specifically mentioned that the amount was insufficient in the account and hence, the cheque was dishonoured. The notice was served on the accused and he gave reply in terms of Ex.P6. On perusal of Ex.P.6-reply notice, the accused has admitted the issuance of the cheque and did not dispute that the cheque does not belongs to him, but in para No.5 of his reply, he has stated that he himself and Ravikumar, Srinath, Girish B.P and Candrashekaran are colleagues and working in the Aircraft Division. They had entered into an oral agreement to do the business of buying and selling of mobile handsets. The business went on well for 6 to 7 months. Thereafter, they incurred loss due to fluctuation in the price of the mobile handsets. The complainant and others stealthily wanted to make good the loss by making use of the innocence of accused and threatened him that he would be eliminated by engaging supari killers. It is further admitted that the complainant and others abducted the accused on 17.06.2014 in a car forcing him to pay Rs.5,00,000/- The brother of the accused Sri. R.Arvind was also taken to HAL police station and wrongfully confined for 5 days. Thereafter, he was set at liberty with warning. It is contended that the cheques mentioned was taken in blank during the course of transaction and fraudulently misused the same by scribing the cheques, presenting the same before the Bank and getting it dishonoured.
15. On perusal of legal notice, there is no any mention with regard to the fact that the amount was lent to help the brother of the accused and the same is admitted in the cross- examination of P.W.1. It is also important to note that both the complainant and accused are employees of HAL and there is no dispute with regard to the same. P.W.1 in the cross-examination categorically admits that he is aware that to do any business, they have to seek permission from the department and no such permission is taken. He further admits that if any payment of more than Rs.20,000/- is to be made, the same is to be paid by way of cheque as per the Income Tax Act. It is further admitted that he did not mention the advance amount of Rs.9,70,000/- in the income tax returns and also he categorically admits that he did not mention the mode of payment in the complaint, legal notice and also in his evidence. It is to be noted that in the cross-examination also P.W.1 reiterates that accused took amount as hand loan to do the business.
16. The main contention of the accused is that the complainant himself and his friends orally agreed to do the business of selling the mobile handsets and they suffered loss in the business. This complainant and other friends have also filed the complaint against the accused at the instance of one B.P.Girish. No doubt in the reply notice, the accused not only stated the said fact but also stated that he was subjected to threat and his brother was also taken to HAL police station and made him to be in custody for a period of 5 days. The same has not been reiterated in his evidence, but he contended that the cheque was given during the course of business which they have done according to their oral understandings between the friends. It is to be noted that P.W.1 categorically admits that an amount of Rs.9,70,000/- was paid to the accused. No doubt in the cross- examination of D.W.1, it is elicited that an amount of Rs.1,50,000/- was transferred to his account by the complainant in terms of Ex.P.7(a) which is dated 28.05.2014. On perusal of complaint, no where it has been stated that on what date the amount of Rs.9,70,000/- was paid to the accused.
17. Learned counsel appearing for the appellant/complainant would contend that another amount of Rs.2,61,000/- was drawn in the first week of May, 2014 and the amount was paid in the month of May itself, but no such averments were made in the complaint. It is to be noted that an amount of Rs.9,70,000/- is mentioned in terms of Ex.P1. P.W.1 categorically admits in the cross-examination that his salary is only Rs.20,000/- per month and on perusal of Ex.P7-passbook which is produced later on, there is no any entry to show that he was having an amount of Rs.9,70,000/- in the passbook. He also claims that he had kept the amount, which he paid to the accused, in his house and the said amount is his savings. The complainant has not deposed before the Court that he was having other source of income.
18. First of all with regard to the source of income, the complainant has not made out the case and the complaint claims that the accused borrowed hand loan of Rs.9,70,000/- to do business. He categorically admits in the cross-examination that he is also an employee of HAL and he is forbidden from doing any business. He also made an admission in the evidence that in order to help the brother of the accused, the amount was given but there is no such averments in the legal notice in terms of Ex.P3, the complaint and also in the chief evidence. However, the same has been elicited during the course of cross- examination. It is also important to note that he had not disclosed about the amount of Rs.9,70,000/- being advanced to the accused as hand loan in the income tax returns. The accused has taken specific defence that he himself, B.P.Girish and his friends are working in the very same department and having acquaintance with each other. They had orally agreed to do the business and in that connection, he gave cheques. Further he contended that he availed hand loan of Rs.4,00,000/- from one B.P.Girish and thus, the complaint was filed at the instance of the said B.P.Girish.
19. No doubt the Court can draw presumption under Section 138 of the Act when the cheque has been given by the accused and at the same time, the accused can rebut the said presumption under Section 139 of the Act. In the case on hand, the admission given by P.W.1 takes away his case since he is an employee of HAL and has to intimate the Department, if any amount is to be lent to anybody. With regard to his source of income, there is no cogent evidence produced by the complaint before the Court and also he has not disclosed about the amount of Rs.9,70,000/- being advanced to the accused, in the income tax returns and he is also aware that if any amount exceeding Rs.20,000/- is to be paid by way of cheque only.
20. On perusal of the material available on record, in each stage, the complainant made an attempt to improve his case and there is no specific pleading so as to on what date he advanced the said amount. Further, he claims that accused gave the cheque in pursuance of lending of the amount on 12.6.2014 and he made an attempt to substantiate the contention by showing the relevant entry at Ex.P.7(a) and also the amounts withdrawn in the passbook. It is not the case of the accused that the complainant paid the amount in the month of May and subsequently, demand was made to the accused to issue the cheque in the month of June 2014.
21. Learned counsel appearing for the complainant relying upon the decision of Hon’ble Apex Court in Kishan Rao’s case stated supra brought to my notice that accused has not rebutted the evidence of the complainant and the judgment is aptly applicable to the case on hand.
22. On perusal of the judgment, the Apex Court while considering the contentions held that the accused has not rebutted the evidence of the complainant by adducing any cogent evidence before the Court. In the case of hand, the accused has been examined before the Court and he reiterated the contents of his reply notice in the evidence. Hence, the principle laid down in the judgment of the Apex Court would not be applicable to the case on hand. This Court, in the unreported judgment as relied on by the appellant’s counsel in Crl.A.No.2109/2017 at para No.15, has held that accused ought to have rebutted the contention of the complainant by producing cogent evidence. Hence, this judgment also does not come to the aid of complainant as in the said case, the accused had taken the defence that there was no transaction between the complainant and the accused, whereas, in this case, the Court mainly relied upon the transactions between both the parties earlier to the transaction which is in question. Having considered the same, the accused cannot blow hot and cold.
23. The factual matrix of the case on hand and also the cases which are reported are different. In the case on hand, first of all the complainant did not mention on what date he advanced the amount of Rs.9,70,000/- to the accused not only in the complaint but also in the evidence and so also in the legal notice. When the question was put to him with regard to his source of income, he relied upon Ex.P7 but Ex.P7 does not help the complainant in any way. No doubt there was a transaction between the complainant and the accused and an amount of Rs.1,50,000/- was transferred to the account of the accused, but there is no material with regard to transferring the amount to the tune of Rs.9,70,000/-. The complainant’s case is also not specific with regard to the mode of payment that how he made the payment.
24. It is very clear by the answers elicited from the mouth of P.W.1 that he is an employee of HAL and he had not informed the concerned authority for having paid the amount and so also not disclosed the same in the income tax returns. It is an admitted fact that both are employees of HAL and they cannot do any business without prior permission from the concerned authority. During the course of cross-examination, he claims that he helped his brother but no such averments are made in the pleadings. Under such circumstances, the very transaction between the complainant and the accused is doubtful and the accused also rebutted the evidence of the complainant by entering into the witness box. The Court below, while considering the materials available on record and the admissions elicited from the mouth of P.W.1, discussed with regard to the source of income as well as the capacity to make the payment. Since the complainant is an employee of HAL, he cannot lend money without prior permission of the superior authorities and he has also not disclosed the same in the income tax returns and so also not intimated his superiors for having lent the money. Hence, I do not find any merit in the appeal to reverse the findings of the Trial Court. The Court below has considered both oral and documentary evidence and not committed any error in appreciating the same.
25. In view of the discussions made above, I pass the following:
ORDER The appeal is dismissed.
PYR Sd/- JUDGE