IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18th DAY OF OCTOBER, 2019 BEFORE THE HON’BLE MR. JUSTICE K.N.PHANEENDRA CRIMINAL APPEAL No.473/2014 BETWEEN:
Sri.S.Vinod Kumar S/o Sri.Nagaraj, Aged about 29 years, R/at No.59, BSK VI Stage, III Block, Chikkagowdanapalya, Talgattapura Post, Bangalore-62. …Appellant (By Sri.M.M.Ashoka, Advocate) AND:
Sri.Prabhath Kiran, Proprietor, M/s.Prabhath Communication, (Earlier M/s.Rajeshwari Telecom) No.285/A, 12th Cross, IX Main, Ideal Home Circle, Rajarajeswarinagar, Bangalore-560098. …Respondent (By Sri.N.M.Srinivasamurthy, Advocate) This criminal appeal is filed under Section 378(4) of Cr.P.C. praying to set aside the impugned order dated 21.04.2014 passed by the XVI Addl. Chief Metropolitan Magistrate, Bangalore City in C.C.No.4594/2010 acquitting the accused-respondent for the offence punishable under Section 138 of NI Act.
This Criminal Appeal coming on for admission this day, the Court delivered the following:
JUDGMENT Heard the learned counsel for appellant/complainant and respondent/accused on merits of the case as the records have already been received at the admission stage. Perused the records.
2. The brief factual matrix of the case as could be seen from the records is that the appellant herein has filed a complaint against the respondent under Section 200 of Cr.P.C. making allegation that offence being committed by respondent under Section 138 of Negotiable Instrument Act,1881 (‘N.I.Act’, for short) 3. The allegations made in the complaint and as depicted in the evidence by the complainant is that the accused was known to the complainant since several years and the complainant was working as a ‘Team Manager’ in the year 2006 under the accused in his business running under the name and style “M/s. Prabhath Communication” and had some problem with Airtel Communication. Thereafter, the respondent started dealing with multibrand sim cards under the name of M/s.Rajeshwari Telecommunication and at that time, the respondent offered the same, and the appellant purchased the entire business for a sum of Rs.4,00,000/-. The said fact is admitted by the accused as well as the complainant. After purchase of the entire running business by paying a sum of Rs.4,00,000/-, the complainant also failed to run business, therefore he intended to resale the running business in favour of accused for a sum of Rs.3,50,000/-. In this context, it is alleged that on 13.07.2009, the complainant sold the entire running business in favour of accused. In turn, the accused in consideration of sale transaction issued a cheque for a sum of Rs.3,50,000/- dated 15.07.2019 bearing cheque No.085256 drawn on Sreenidhi Souhardha Sahakari Bank Niyamitha, V.V.Puram Branch, Bangalore. It is also stated that possession of the running business has been delivered in favour of accused in lieu of the said sale consideration. The subsequent event of the presentation of the said cheque, dishounor of cheque, issuance of notice and filing of complaint are all not disputed.
4. The accused during the course of replying the notice issued by the complainant has taken a specific stand that the said running business was actually sold to the complainant but he has not resale the same to the accused and he has not taken back the running business. He has also taken further specific stand that the same was sold to one Mr.Kranthi son of Keshvareddy but not to the accused. However, the sale of business transaction was taken place as a security for purchase and cheque for a sum of Rs.3,50,000/-
was issued by the accused. After issuance of summons, the accused appeared before the Court and contested the proceedings. During the course of evidence also the accused has taken the same defence.
5. During the course of evidence of PW1, the complainant has reiterated the complaint averments. In the examination-in-chief itself he has not stated about in what manner the running business was transferred in favour of the accused. As to when and on which date the possession of the said business was handed over to the accused and in what manner is also not explained by the PW1. Thereafter, the accused was started to run the same, in order to establish that, the said cheque was actually issued towards sale consideration of reselling the said business transaction in favour of accused. Even in the cross-examination, the suggestions have been made to the complainant by the accused that accused has not taken back the business and he has not issued any cheque in consideration of the said sale transaction. It is only issued as a security for the purpose of negation but negotiation is not concluded in the contract. Therefore, there is no debt or liability on the part of the accused under the cheque.
6. The complainant also led evidence of one Sri.Narasimha Murthy as PW.2. Though, this witness has stated that he was present at the time of negotiation of the sale transaction of reselling the running business by the complainant to the accused but he never stated with regard to the handing over to the business to the accused on the date of transaction or subsequently any date. Therefore, the evidence of this witness is also not adequate in order to support the case of the complainant particularly with regard to redelivering the business transaction in favour of accused.
7. The accused has also led evidence reiterating the contents of reply notice. He has taken a specific stand that the said running business was not at all transferred to him and he has not taken back the running business from the complainant. On the other hand, the same was sold to one Kranthi son of Keshavareddy. In this context, the negotiation has taken place earlier between the complainant and accused and the cheque for a sum of Rs.3,50,000/- was issued to the complainant by the accused as a security for negotiation. As such, he stuck on his defence. Therefore, there is no liability or debt to be payable to the complainant. Therefore, the burden on the complainant is restored to establish the existence of debt or liability.
8. Of course the legal aspects also looked into by this Court. The legal presumption also contemplated under Section 138 of N.I. Act which pre-supposes that the Court has to draw presumption initially in favour of the complainant that the said cheque was issued by the accused. It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in Section 138 of the Act for the discharge, in whole or in part, of any debt or other liability.
9. Apart from rising the presumption under Sections 118 and 139 of NI Act that the said cheque once admitted to have been issued by the accused, the same was issued on the date mentioned in the cheque and amount mentioned in the cheque and under Section 139 of NI Act, the said cheque was issued for discharge in whole or in part of any debt or other liability. This presumption is not a conclusive proof. Presumption always carries with it opportunity to the opposite party in order to rebut the presumption by means of examining himself or cross examination of the complainant. Therefore, the Court has to raise the presumption in favour of the complainant at the initial stage and after recording of evidence. The Court has to examine as to whether it is rebutted or not. In this background the Court has to appreciate meticulously the entire evidence.
10. It is clear cut case of the complainant that he has purchased the running business from the accused. There is no need to establish this particular aspect, in view of Section 58 of Indian Evidence Act, that admitted facts need not be proved. The complainant has categorically stated that he has purchased a running business from the accused for a sum of Rs.4,00,000/-. Thereafter he resold the same to the accused for a sum of Rs.3,50,000/-. There is an admission on the part of the complainant and the accused that negotiation had been taken place with reference to the sale transaction. In this regard, the accused has issued a cheque for a sum of Rs.3,50,000/-
towards sale consideration of repurchasing of the said running business from the complainant.
11. Now the question arises that, whether the said sale transaction was concluded on the basis of which, the running business was actually transferred and handed over in favour of the accused. Admittedly, PW1 has stated, except the disputed cheque, he has no other evidence or material to show that the running business was resold to the accused. Therefore, the burden cast upon the complainant which has not been discharged from him. Of course, the accused has also taken a specific contention that the said running business has been sold by the complainant to one Mr.Kranthi, son of Keshavareddy but he has also failed to produce any materials before the Court to prove the same. If really the running business was sold to one Kranthi, the burden is on the complainant to establish with regard to the existence of debt or liability on the part of the accused when initial presumption is raised in favour of accused has been successfully rebutted, the burden is restored on to the complainant to prove the existence of the said fact.
12. Looking to the above said facts and circumstances of the case, when there are absolutely no materials except issuance of cheque with reference to the business transaction and transferring the running business in favour of accused, the trial court has rightly concluded that the complainant has failed to prove the existence of legally enforceable debt or liability, whic is the harbinger for the purpose of proving the same under Section 138 of N.I.Act.
13. Under the above said circumstances, in my opinion the trial Court has rightly appreciated the legal points on the basis of the factual aspects on records and has rightly concluded the judgment in favour of accused. As such, I do not find any reason to interfere with the said judgment of acquittal and there is no reason to admit the appeal.
The case is not fit for admission; Hence, the appeal is dismissed at the stage of admission itself.
Sd/- JUDGE JS/-