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B. V. NAGARATHNA, K. V. VISWANATHAN
Mohammad Ali – Appellant
Versus
Sharanappa – Respondent
Key Points: - Supreme Court upheld High Court's reversal of trial court's acquittal under Section 138 NI Act, convicting appellant (!) (!) (!) . - Respondent proved foundational facts, entitling presumption under Sections 118 and 139 NI Act; absence of rebuttal evidence justified conviction (!) (!) . - Appellant cannot challenge presumption or foundational facts without rebuttal evidence (!) . - High Court imposed fine of Rs.10,10,000/- under Section 255(2) Cr.P.C., with Rs.10,00,000/- as compensation to respondent under Section 357(1)(b) Cr.P.C. and Rs.10,000/- to State (!) (!) . - No separate compensation over and above cheque amount (Rs.10,00,000/-); fine covers cheque amount as compensation (!) (!) (!) . - Supreme Court granted three months to deposit cheque amount and fine, with default sentence; cheque amount payable to respondent immediately (!) . - Appeal disposed of, confirming conviction and sentence (!) .
ORDER
Leave granted.
2. Being aggrieved by the judgment dated 09.10.2023 passed by the High Court of Karnataka-Kalaburagi Bench in Criminal Appeal No.200030 of 2017, the appellant/accused is before this court. By the said judgment, the judgment of acquittal dated 06.01.2017 passed by the I Addl. Civil Judge & J.M.F.C.I Vijaypur in Criminal Case No.2378 of 2013 has been set aside and the appellant has been convicted of the offence under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as, “the Act”).
3. The operative portion of the impugned judgment reads as under:
The accused is found guilty. Acting under Section 255(2) of Cr.P.C., the accused is convicted for the offence punishable under Section 138 of the N.I.Act and he is sentenced to pay fine of Rs.10,10,000/- (Rupees Ten Lakhs Ten Thousand only). In default of payment of fine amount, the accused shall undergo simple imprisonment for a period for six months.
Further, acting under Section 357(1)(b) of Cr.P.C
Dishonour of cheque – Even in absence of any rebuttal evidence, appellant cannot contend that there was absence of foundational facts or that very raising of presumption under Section 118 read with S....
Compensation under Section 138 of the Negotiable Instruments Act must be proportionate to the dishonoured cheque amount and not punitive for delays in resolution.
The main legal point established in the judgment is that in cases of conviction under Section 138 of the Negotiable Instruments Act, unless there are special circumstances, fine up to twice the chequ....
The court emphasized the need for uniformity in compensation for cheque dishonour cases, affirming that compensation should reflect the cheque amount and interest, as established in prior Supreme Cou....
Compensation under Section 357(3) of CrPC must be reasonable and not exceed the actual loss suffered, aligning with the cheque amount in dishonor cases.
The obligation to impose appropriate sentences and the need for courts to apply their minds while imposing sentences.
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