IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 11TH DAY OF FEBRUARY 2019 BEFORE THE HON’BLE Dr. JUSTICE H.B.PRABHAKARA SASTRY CRIMINAL APPEAL No.1296 OF 2010 BETWEEN:
Sri. K.C.Srinivasa S/o. Late C.Krishnappa, Aged about 46 years, R/at No.284/E, 4th Cross, 6th Main, Vivekanagar Layout, Bengaluru-560 047. …Appellant (By Sri. M.R.Nanjunda Gowda, Advocate) AND:
Sri. S. Nandeesha, R/at No.105, Jnana Ganga Nagar, Near Panchajanya Vidhyapeeta School, (PVP School), 1st Cross, Bengaluru-560 056. …Respondent (By Sri. C.R.Gopalaswamy, Advocate) This Criminal Appeal is filed under Section 378(4) of Cr.P.C praying to set aside the order dated:04.11.2010 passed by the XIII ACMM, Bengaluru in C.C.No.24681/09 – acquitting the respondent/accused for the offence punishable under Section 138 of N.I.Act.
This Criminal Appeal coming on for Hearing this day, the Court delivered the following:
JUDGMENT In the complaint filed by the present appellant under Section 200 of Code of Criminal Procedure, against the present respondent, for the offence punishable under Section 138 of Negotiable Instruments Act, 1881 (hereinafter for brevity referred to as `N.I.Act’), the learned XIII Additional Chief Metropolitan Magistrate, Bengaluru (hereinafter for brevity referred to as `trial Court’), in C.C.No.24681/2009 pronounced the judgment of acquittal on 04.11.2010. It is against the said judgment of acquittal, the complainant has preferred this appeal.
2. The summary of the case of the complainant in the trial Court is that the complainant is an advocate and the accused / respondent is said to be a member in the Advocates’ Association at the Mayo Hall Unit, Bengaluru in the month of March, 2009. At the request of the accused, the complainant had lent him a hand loan of `3,50,000/- which the accused had agreed to repay within a period of 5 to 6 months. He had also agreed to pay interest on the loan amount @ 2% per month. Since the accused was known person to him, no document was made in that regard. However, towards the repayment of the loan amount accused issued post dated cheque bearing No.050487 dated 12.08.2009 drawn on ING Vysya Bank Limited, Mayo Hall Unit, Bengaluru in favour of the complainant. The accused was paying interest for some time at `7,000/- per month. However, when the cheque was presented for realisation, the same came to be dishounoured with Banker’s shara ‘funds insufficient’. Thereafter, a legal notice as contemplated under Section 139B of the N.I.Act was also issued which invoked untenable reply from the accused. Then loan amount having remained unpaid and the cheque got dishonoured, complainant was constrained to institute a complaint against the accused in the trial Court for the offence punishable under Section 138 of N.I.Act.
3. The trial Court after recording the evidence led before it from both side and hearing arguments from both side, by its impugned judgment dated 04.11.2010 acquitted the accused of the alleged offence. It is challenging the said judgment of acquittal, complainant has preferred this appeal.
4. Heard argument from both side. Perused the lower Court records.
5. The complainant got himself examined as PW1 who in his examination-in-chief in the form of affidavit evidence has reiterated the contention taken up by him in his complaint and stated that accused having availed the loan of `3,50,000/- on 12.03.2009 had issued a post dated cheque in question which when presented for realisation came to be dishonoured. He has got marked the alleged cheque in question, Banker’s endorsement, copy of his reply notice which legal notice received as exhibits from his side.
6. The accused got himself examined as DW1, wherein he has though admitted his acquaintance with the complainant as a practicing advocate and himself being an employee of Advocates Association but categorically denied that there was any advancement of loan to him much less a sum of `3,50,000/- as contended by the complainant. On the other hand DW1 has stated that he had availed a loan of `3,00,000/- from the complainant in the month of July, 2008 which amount also he has completely repaid. He has given the details as to the mode of repayment made by him. Thus, according to the accused / DW1, the only loan transaction he had with the complainant which was for a sum of `3,00,000/- was duly cleared by him and that the alleged loan transaction has never been in existence. In his support he has produced copy of the Banker’s statement, copy of reply notice sent by him among the other documents in exhibits ‘D’ series.
7. Even according to PW1 with respect to the transaction in question which according to him is a sum of `3,50,000/- dated 12.03.2009 except the cheque in question at Ex.P1 there are no supporting documents. According to the complainant since accused was an employee of Advocates’ Association wherein he was a member as an advocate he had not collected any document from him. According to the complainant said loan amount has remained unpaid in totality.
8. The defence of the accused was put in the mouth of the complainant(PW1) in his cross examination. In the said cross examination complainant though has denied a suggestion that the accused has repaid the loan once at a sum of `2,50,000/- through a cheque dated 28.08.2008 and another sum of `50,000/- through a cheque dated 15.09.2008 but has volunteered to say that the same was in connection to some other transaction. PW1 has also denied the suggestion that thereafter once again a sum of `7,500/- in the form of cheque dated 05.11.2008 and another sum of `10,000/- through a cheque dated 16.01.2009 were paid to him. However, PW1 stated that the cheque dated 05.05.2009 though was in connection with the recent loan transaction, but it was towards interest. DW1 apart from reiterating about these alleged payments said to have been made by him to PW1 has also produced his Bank’s statement which reflected a sum of `2,14,900+`50,000+`7,500+`7,500+`10,000+`11,000 and `7,500/- are shown to have been debited in the account of the defendant by honouring the cheque drawn in favour of Sri.Srinivasa who is the complainant / appellant herein. Thus, though PW1 has initially denied that any such repayment was made to him but his voluntary statement that those payments which in total comes to a sum of `2,68,400/- were towards another loan transaction, has any way admitted by him that those payments amounting to `2,68,400/- has been received by him as repayment of the loan amount. In such a case, the accused could able to establish that a substantial amount has been paid by him.
9. To show that the said payment of `2,68,400/- made by the accused was towards previous loan transaction, the complainant has not produced any piece of paper or any document. He has not even come up with the details of the alleged previous loan transaction as to when, where and for what purpose the alleged previous loan was said to have been given by him to the accused. Admittedly the appellant / complainant is not a money lender but a practicing advocate. Needless to say that being a practicing advocate knows the consequences of law and also about the requirement of maintaining atleast few basic documents to show the existence of more than one loan transaction between the him and the accused, which the complainant / appellant has not done in the present case.
10. The other side of the case is that issuance of cheque at Ex.P1 which is in question by the accused to the complainant is also not in dispute. Once, the issuance of cheque by the drawer to the payee is established, then as per Section 139 of the N.I.Act and as per the judgment of Hon’ble Apex Court in Rangappa Vs. Sri Mohan reported in (2010) 11 SCC 441, a presumption starts operating in favour of the complainant about the existence of legally enforceable debt or liability payable by the accused. However, the said presumption is rebuttable.
11. In the instant case, even though it is presumed that such a presumption operates in favour of the complainant, but, it cannot be forgotten that the same is rebuttable. It is in the said process of rebutting the said presumption, the accused has come up with his specific defence that only loan transaction he had with the complainant was that a sum of `3,00,000/- that too in the month of July 2008, but, not even in the month of March, 2009 as alleged by the complainant.
12. The first contention taken by the accused at the earliest point of time is in his reply to the legal notice, copy of which reply notice could be seen at Exs.P8 and D2. In the said reply to the notice, the accused has taken a contention that only one loan for a sum of `3,00,000/- was availed by him in the month of July 2008. Taking that defence, which was put in the mouth of PW1 in his cross-examination, the accused has produced Exs.D1(a) to D1(g), to show that the payments made from August 2008 to July 2009 pertain to the loan availed much prior to the alleged loan in question.
13. Therefore, the defence taken by the accused that the only loan transaction was of July, 2008 and he has started repayment of the same from August, 2008 and has made the repayment of the loan in several portions, since gains its corroborations through document at Ex.D1 and admission of those repayments by PW1 also, in his cross examination same appears to be of more probable compared to the stand taken by the complainant in his case.
14. Secondly, according to PW1, those payments at `2,14,900+`50,000 was towards some other transaction. However, as observed, the complainant could not able to show or place any material to show that the same was with respect to another transaction.
15. However, assuming for the time being that there was more than one loan transaction, still the admission of PW1 in his cross examination that he has received a sum of `11,000/- on 08.06.2009 and `7,500/- on 10.07.2009 cannot be ignored. When he has specifically admitted the receipt of the said amount which in total comes to a sum of `18,500/- and since the complainant has failed to give any account as to towards which loan transaction the said amount was received the only inference that could be drawn is that the said alleged payment is towards the alleged existence of loan under consideration. If that were to be the case, then the alleged outstanding liability according to PW1 cannot be a sum of `3,50,000/- and it would be any amount less than the said amount. Once the cheque amount is more than what the alleged outstanding loan amount is and there is no explanation for the said difference amount which is higher amount in the cheque, then it has to be necessarily held that on the date of issuance of the cheque and presentation of the same, there was no outstanding liability equivalent to the said cheque amount.
16. When there is no legally enforceable debt equal to the cheque amount as on the date of presentation of the cheque, the presumption under Section 139 of the N.I.Act won’t favour the complainant even though the cheque stands dishonoured for the reason of insufficiency of funds. Thus, for the reason of defence taken by the accused appearing more nearer to the truth and preponderance of possibility being in his favour and the complainant not being able to show that he was entitled for presumption under Section 139 of the N.I.Act, since the outstanding liability falling short of the cheque amount, the only consequence would be acquittal of the accused from the alleged charges. The trial Court since has rightly acquitted the accused for the alleged offence though for the different reasons, I do not find any ground to interfere in the said finding.
Accordingly, the appeal stands dismissed as devoid of merit.
The judgment of acquittal passed by XIII Additional Chief Metropolitan Magistrate, Bengaluru on 04.11.2010 in CC No.24681/2009 stands confirmed.
Sd/- JUDGE GH