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2022 Supreme(Kar) 1514

IN THE HIGH COURT OF KARNATAKA
H.B. Prabhakara Sastry , J.
M/s Mdn Enterprises – Appellant
Versus
Lokesh E – Respondent
Criminal Revision Petition No. 219 of 2018 C/W Criminal Revision Petition No. 220 of 2018
Decided On : 16-06-2022

Advocates appeared:
Sri. Ravikumar N R, Advocate, for the Appellant; Smt. Vijaya M N, Advocate, for the Respondent

The main legal point established is the presumption of legally enforceable debt under Section 139 of the Negotiable Instruments Act and the sufficiency of notice served to the accused.

Headnote:

Negotiable Instruments Act - Cheque Bounce - N.I.Act, Section 138 - The court discussed the legal provisions of Section 138 of the Negotiable Instruments Act, the presumption of legally enforceable debt under Section 139, and the requirements for notice under the Act. The court's decision was influenced by the interpretation of the presumption of debt and the sufficiency of notice served to the accused.

Fact of the Case:

The accused issued cheques to the complainants for loans, which were returned unpaid. The complainants sent notices demanding repayment, but the accused contested the existence of the loan transactions.

Finding of the Court:

The court found that the accused failed to rebut the presumption of legally enforceable debt in both cases. The court rejected the accused's defense and upheld the judgments of the Trial Court and the Session Judge's Court, convicting the accused.

Issues: The issues involved the existence of loan transactions, sufficiency of notice, and the accused's defense of issuing cheques as security.

Ratio Decidendi: The court held that the accused's failure to take action to recover the cheques, lack of evidence supporting the defense, and the sufficiency of notice served to the accused led to the rejection of the accused's defense and the upholding of the convictions.

Final Decision: The Criminal Revision Petitions were dismissed as devoid of merits.

common order

1. The present petitioner which is a proprietorship concern represented by its proprietor Mr.Doulat Basha, was the accused in C.C.No.1049/2011 and C.C.No.1051/2011, both in the court of the III Additional Civil Judge and JMFC at Chikmagalur (henceforth for brevity referred to as the 'Trial Court') for the offence punishable under Section 138 of the Negotiable Instruments Act (henceforth for brevity referred to as the 'N.I.Act').

2. The summary of the case of the complainant in C.C.No.1051/2011 from which the Criminal Revision Petition No.219/2018 has arisen was that the accused was a person known to him, availed a loan of Rs. 2,50,000/- from the complainant for the purpose of his business improvement and towards repayment of the said loan amount, the accused issued a cheque bearing No.251909 dated 18.10.2010 drawn on State Bank of India, Chikkamagalur branch, for a sum of Rs. 2,50,000/- in favour of the complainant therein. However, when the said cheque was presented for its realization, the same returned unpaid with the bankers memo 'Account Closed'. In spite of service of notice upon the accused demanding payment of the cheque amount, since the accused did not meet the demand, the complainant was constrained to institute criminal case against him in the Trial Court in C.C.No.1051/2011 for the offence punishable under Section 138 of N.I.Act.

3. The summary of the case of the complainant in the Trial Court in C.C.No.No.1049/2011 was that the accused who was a person known to him for the purpose of his business improvement had availed a loan of Rs. 2,00,000/- from him and towards the repayment of the said amount, he issued a cheque bearing No.251914 dated 29.11.2010 for a sum of Rs. 2,00,000/-drawn on State Bank of India, Chikkamagalur branch. The said cheque when presented for its realization by the complainant, was returned unpaid with the bankers endorsement 'Account Closed'. In spite of the complainant giving a notice to the accused demanding the repayment of the cheque amount, since the accused failed to meet the said demand, the complainant was constrained to institute criminal case against him in the Trial Court in C.C.No.No.1049/2011 for the offence punishable under Section 138 of the N.I.Act.

4. Both the matters were contested by the accused in the Trial Court. In both the cases, the complainants got themselves examined as PW.1 respectively. In C.C.No.1051/2011 on behalf of the complainant, the documents were marked from exhibits P-1 to P-7. In C.C.No.1049/2011, from the complainant side, documents from exhibits P-1 to P-6 were marked. In both the criminal cases, the accused neither examined any witness nor produced any documents as exhibits from his side.

5. The respondents in both these petitions were the complainants in each of the criminal cases respectively. Both the criminal cases which were tried separately, ended in conviction by the judgment of the Trial Court, both dated 29.12.2016.

6. Aggrieved by the same, the accused preferred Criminal Appeal No.19/2017 against the judgment in C.C.No.1049/2011 and Criminal Appeal No.20/2017 against the judgment in C.C.No.1051/2011, both in the court of II Additional Sessions Judge at Chikkamagalur (henceforth for brevity referred to as 'Session Judge's Court'). Both the appeals were dismissed on merit by separate judgments of the Session Judge's Court, both dated 24.11.2017. Aggrieved by the same, the accused in the Trial Court has preferred these two Revision Petitions.

7. The respondents are being represented by their counsel, the Trial Court and Session Judge's court records were called for and the same are placed before this court.

8. At the request of the petitioner, both these petitions were clubbed together and taken up for disposal together.

9. Though both the matters were listed for admission, however, with the consent from both side, both the matters were taken up for final disposal.

10. Heard the learned counsel from both side. Perused the materials placed be

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