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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
Ramachandra D. Huddar, J.
Sri Krishna Reddy M, S/O Late Chikkamuniswamy – Petitioner
Versus
Smt. N. Sharadamma, W/O Venkataswamy Reddy – Respondent
CRIMINAL APPEAL NO. 40 OF 2015 (A)
Decided On : 26-07-2024
Negotiable Instruments - Section 138, 118, 139 of NI Act - The court discussed the presumption of consideration and liability under the NI Act, emphasizing that these presumptions are rebuttable and the burden lies on the complainant to prove the existence of a legally enforceable debt.
Fact of the Case:
The complainant advanced a loan of Rs.6,00,000 to the accused, who issued a cheque for repayment. The cheque was dishonoured due to insufficient funds, leading the complainant to file a complaint under Section 138 of the NI Act after issuing a legal notice.
Finding of the Court:
The trial court acquitted the accused, finding that the complainant failed to prove the existence of a legally enforceable debt, and the accused successfully rebutted the presumption of liability under the NI Act.
Issues: Whether the complainant proved the existence of a legally enforceable debt and whether the accused successfully rebutted the presumption under the NI Act.
Ratio Decidendi: The court held that the presumption under Sections 118 and 139 of the NI Act is rebuttable, and the burden lies on the complainant to prove the existence of a debt, which was not established in this case.
Result: The appeal is dismissed, and the trial court's judgment of acquittal is confirmed.
JUDGMENT :
RAMACHANDRA D. HUDDAR, J.
This appeal is filed by the complainant-appellant being aggrieved by the judgment of acquittal of accused- respondent for the offence punishable under Section 138 of the Negotiable Instrument (in short `the Act') passed in C.C.No.4696 of 2010 dated 20th November 2014 by the XXIII Additional Chief Metropolitan Magistrate, Nrupathunga Road, Bengaluru City.
2. Parties to this appeal are referred to as per their rank before the trial Court for the purpose of convenience.
3. That complainant-respondent filed a complaint under Section 200 of Cr.P.C against accused - respondent for the offence punishable under Section 138 of the NI Act alleging that, himself and accused are known to each other. It is stated that, in the second week of December 2009, accused approached the complainant for a financial assistance to the extent of Rs.6,00,000/- to meet her urgent legal requirements. It is stated that accordingly on the request of the accused, complainant advanced a loan of Rupees six lakhs to the accused on the 9.12.2009 by hard cash. The accused promised to repay the same within a period of six months time.
4. In repayment of the said loan amount, accused issued a cheque bearing No.762704, dated 04.01.2010 for rupees six lakhs drawn on Dena Bank, J.P. Nagar Branch, Bengaluru. At the request of accused, complainant presented the said cheque for encashment through his banker i.e., Canara Bank, Varthur Branch, Bengaluru. It is alleged that, said cheque came to be dishonoured for want of sufficient funds in the account of the accused as per the endorsement dated 20.04.2010.
5. It is stated that, because of the dishonour of the said cheque, within the statutory period, the complainant issued a legal notice on the 12.05.2010 both by way of registered post acknowledgment due as well as `Under Certificate of Posting'. The said notice was duly served upon the accused. On receipt of the said notice, accused issued reply denying the issuance of the cheque and also legally enforceable debt etc. As accused has not paid the cheque amount, the complainant was constrained to file a complaint as stated supra against the accused.
6. The records of the trial Court reveal that, after filing the complaint, the trial Court took the cognizance of the offence, recorded the sworn statement of the complainant and after satisfaction of making a prime facie case by the complainant, issued summons to the accused. In response to the summons, accused appeared before the trial Court and was enlarged on bail. The learned trial Court recorded the plea of the accused and for which, the accused pleaded not guilty.
7. To prove the offence made out against the accused, complainant himself entered the witness box as PW.1. Got marked Exs.P1 to P7 and closed the complainant's evidence. After recording statement of the accused under Section 313 of Cr.P.C., by denying all the incriminating evidence appearing in the evidence lead by the complainant, accused herself entered the witness box as DW.1. So also, examined DW.2 by name Smt.Bhagya Lakshmi as DW.2. On behalf of the accused, Exs.D1 to D29 were marked.
8. The learned trial Court, on hearing the arguments and on evaluation of the evidence placed on record by the complainant raised three points for its consideration and answered the important two points in the negative and passed an order of acquittal of the accused of the aforesaid offences. This is how the complainant-appellant is before this Court challenging the aforesaid judgment of acquittal passed by the trial Court.
9. It is argued by the counsel for the complainant- appellant that, the signature on the said cheque is admitted. Issuance of the cheque is admitted. Therefore, according to his submission, when the cheque is admitted and also the signature on the same, then the presumption which is available under the provisions of Section 118 and 139 of the NI Act comes into operation. Therefore, in view of the presumptions which are very much a
The presumption of liability under the NI Act is rebuttable, and the burden of proof lies on the complainant to establish the existence of a legally enforceable debt.
Dishonour of cheque – Whereas prosecution must prove guilt of an accused beyond all reasonable doubt, standard of proof so as to prove a defence on part of accused is preponderance of probabilities.
The presumption under Section 139 of the NI Act obligates the accused to provide credible evidence to rebut the claim of issuance of a cheque for a legally enforceable debt.
The presumption in favor of the complainant under the N.I. Act is rebuttable, and the standard of proof required to prove a defense in a criminal case is preponderance of probabilities.
The main legal point established in the judgment is the significance of the accused raising a probable defense to rebut the presumption under Section 139 of the N.I. Act, and the requirement for the ....
The presumption under Section 139 of the Negotiable Instruments Act is rebuttable, and the burden of proof lies on the accused to provide a probable defense.
The presumption of consideration under Section 139 of the N.I. Act shifts the burden to the accused to prove non-existence of debt, which was not done in this case.
The presumption under Section 139 of N.I. Act is a presumption of law, as distinguished from the presumption of facts. Presumptions are rules of evidence and do not conflict with the presumption of i....
Presumption under Section 139 of the Negotiable Instruments Act requires the accused to present credible evidence to rebut the holder's claim of legal liability regarding the cheque issued.
The court upheld the acquittal as the complainant failed to prove the loan's existence or that the cheque was issued for legitimate debt, emphasizing the rebuttable nature of presumptions under the N....
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