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IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
Rajesh Rai K.
Mohammed Tajuddin @ Tajuddinsab S/o. Ibrahimsab Humnabad – Appellant
Versus
K.S. Srinivas S/o. Sathyanesan – Respondent
JUDGMENT :
Rajesh Rai K, J.
In this appeal, the appellant/complainant has assailed the judgment of acquittal dated 20.07.2017 in Crl.A.No.112/2013 passed by the Principal District and Sessions Judge, Bagalkot (hereinafter referred to as the 'First Appellate Court'), whereby the learned First Appellate Court allowed the appeal filed by the accused and acquitted him for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short 'N.I. Act') by setting aside the judgment of conviction and sentence dated 21.09.2013 in C.C.No.216/2011 passed by the Additional Civil Judge and JMFC, Hungund (hereinafter referred to as the ‘trial Court').
2. For the sake of convenience, the parties are referred to as per their rankings before the trial Court.
3. The abridged facts of the case are as under:
The complainant is the proprietor of Taj Stones Industries situated at Hanamsagar Road, Ilkal city. The accused is a proprietor of Chetak Enterprises situated at Madalthuruth, Moothukunnam, Ernakulam district, Kerala. They both were well acquainted. In the month of April, 2010 the accused approached the complainant for financial assistance of Rs.6,00,000/-. Based on the request
The complainant must substantiate claims of loan and repayment; initial presumptions do not relieve him of the burden to prove a legally enforceable debt.
The trial court's acquittal was upheld as the complainant failed to provide sufficient evidence to prove the lending capacity and enforceable debt under Section 138 of the NI Act.
The complainant must prove the existence of a legally enforceable debt in a Section 138 NI Act case, and discrepancies in testimony can undermine the presumption of consideration.
Presumption under Section 139 of the NI Act is rebuttable and requires foundational proof of debt; mere issuance of a cheque is insufficient for conviction.
Court held that issuance of a cheque raises a presumption of debt, shifting the burden to the accused to demonstrate otherwise, particularly upon admission of signature.
The burden of proof in Section 138 NI Act cases shifts to the complainant when the accused challenges their financial capacity, emphasizing that presumption of innocence protects the acquitted party.
The presumption of consideration for a cheque does not negate the complainant's burden to prove the existence of a legally recoverable debt, which can be rebutted by the accused.
The main legal point established in the judgment is the requirement for the complainant to prove the existence of a legally enforceable debt and the dishonor of the cheque in a case under Section 138....
The burden of proof in dishonor cases under the N.I. Act shifts to the accused upon issuance of the cheque, and can be rebutted through evidence and inconsistencies by the complainant.
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