JUDGMENT :

1. This appeal is filed challenging judgment of acquittal passed in C.C.No.3336/2006 dated 29.12.2010, on the file of XVIII Additional Chief Metropolitan Magistrate and XX ASCJ, Bangalore City for the offence punishable under Section 138 of Negotiable Instruments Act (hereafter for short ‘ N.I. Act’).

2. For the sake of convenience, the parties are referred to as they are referred to in the original suit before the Trial Court.

3. Brief facts of the case:

Complainant filed complaint under Section 200 of Cr.P.C. against the accused under Section 138 of the N.I. Act and made an allegation that accused being a close relative of the complainant, on 7.12.2003, borrowed hand loan of Rs.6,00,000/-from the complainant, promising to repay the said loan amount within one month and in respect of the above said transaction, complainant demanded the accused for repayment of loan amount, for which, accused had issued a cheque bearing No.085571 dated 31.08.2005, drawn on Syndicate Bank, Nandikoor branch. When the said cheque was presented by the complainant for clearance on 31.08.2005 with his banker, the same was returned unpaid with an endorsement ‘funds insufficient on 05.09.2005.

4. The complainant issued legal notice against the accused which was duly served on him. The accused did not comply the demand and hence complaint was filed against the accused.

5. Accused was secured before the Trial Court and he has pleaded not guilty. Hence, the complainant examined himself as P.W.1 and got marked documents Ex.P.1 to Ex.P.14 and on the other hand accused examined himself as D.W.1 and got examined two witnesses as DWs. 2 and 3 and got marked documents Exs.D.1 and D.2.

6. The Trial Court after perusing both oral and documentary evidence has acquitted the accused. Hence, the present appeal is before this Court.

7. The complainant in the present appeal who contended that the Trial Court has committed error in not appreciating both oral and documentary evidence and it has erred in casting the burden on the complainant.

8. Nature of the presumption under Section 139 is subject to three conditions specified relating to presentation, giving of the notice and the non-payment after receipt of notice by the drawer of the cheque. All three conditions referred to supra have not been denied by the accused in this case. The Trial Court unnecessarily embarked upon the evidence of the complainant with out raising presumption under Section 139 of N.I. Act. The Trial Court even not bothered about to discuss the evidence of the accused-respondent though it is undisputed fact that the accused-respondent has issued the cheque in question. The Trial Court erred in not appreciating the evidence properly and it is not been disputed the fact that the cheque was issued in favour of the complainant and as such it is mandatory on the part of the Trial Court to raise the presumption under Section 139 of N.I. Act.

9. The Trial court dismissed the complaint on the ground that the complainant had no financial capacity to pay the loan amount and he has not complied Section 269 of Income Tax Act and failed to prove the existence of legally recoverable debt. The Trial Court has not appreciated Exs.P.8 to 14 which are admitted by the accused-respondent, Exbit D1 was in confronting the same marked in the Cross-examination of PW1, in proper perceptive. It is also contented that the statutory notice was issued and the same was acknowledged and no reply was given and the only defense taken by the accused is that he has issued cheque as security purpose and the same has not been substantiated in his evidence and no cogent evidence has been led by the accused in respect of the same, inspite of the Trial Court has committed an error.

10. The learned counsel appearing for the appellant/complainant in his argument has vehemently contended that the witness who has been examined on behalf of the accused as D.W.3 has categorically admitted with regard to the capacity of the complainant to a