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KARNATAKA HIGH COURT
J.M. Khazi, J.
A V Poojappa – Petitioner
versus
Dr. S.K. Vagdevi – Respondent
Criminal Revision Petition No.13 of 2020
Decided on 4.6.2025
Negotiable Instruments Act, 1881 – Section 138 read with Sections 118 and 139 – General Clauses Act, 1897 – Section 27 – Criminal Procedure Code, 1973 – Sections 397 and 401 – Dishonour of cheque – Conviction and sentence – Cheque in question is drawn on account of accused, maintained with his Banker and it bears his signature – Presumption under Section 139 of N.I Act that cheque was issued towards repayment of any legally recoverable debt or liability is attracted, placing initial burden on accused to rebut presumption and establish circumstances in which cheque came to be issued or reached hands of complainant – Accused has not sent reply to legal notice spelling out his defence at earliest available opportunity – When any document is required to be served by post, service shall be deemed to be effected by properly addressing, preparing and posting by registered post a letter containing the document – It is proved to have been effected at the time at which letter would be delivered in ordinary course of the post – There is nothing in evidence led by complainant, which is useful to accused, on which he could rely upon – Conviction and sentence affirmed. (Paras 17, 18, 20, 21, 23 and 24)
Result: Criminal Revision Petition dismissed.
ORDER (CAV)
In this petition filed under Section 397 r/w 401 Cr.P.C, accused has challenged his conviction and sentence for the offence punishable under Section 138 of N.I Act imposed by the trial Court, which is confirmed by the Sessions Court, but it partly allowed appeal reducing the sentence.
2. For the sake of convenience, parties are referred to by their ranks before the trial Court.
3. It is the case of the complainant that accused is known to her and her family since past several years. In this background, in the first week of April 2012, accused requested the complainant to advance hand loan of Rs.5,50,000 for his urgent personal requirement. Taking into consideration the request of the accused, complainant advanced hand loan of Rs.5,50,000 on 10.04.2012 i.e, transferred a sum of Rs.5 lakhs to the account of the accused through RTGS and paid the remaining Rs.50,000/- in cash. Accused promised to repay the same during February 2013. On the demand made by the complainant accused issued cheque dated 25.02.2013 for a sum of Rs.5,50,000/-. However, when complainant presented the cheque for realisation, it was returned dishonoured as “Funds insufficient”. In this regard, complainant got issued a legal notice dated 13.03.2013. Despite receipt of the notice, accused has neither paid the amount nor sent any reply, and hence the complaint.
4. After due service of summons, accused appeared before the trial Court and contested the case by pleading not guilty.
5. In order to prove the allegations against accused, complainant examined her power of attorney holder as PW-1 and got marked Exs.P1 to 8.
6. During the course of his statement under Section 313 Cr.P.C accused has denied the incriminating evidence led by the complainant.
7. Accused has not led any defence evidence.
8. The trial Court convicted the accused and sentenced him to pay fine of Rs.7,20,000 with default sentence of imprisonment and directed that out of the fine amount, a sum of Rs.7,15,000/- be paid to the complainant by way of compensation.
9. Aggrieved by the same accused went in appeal before the Sessions Court in Crl.A.662/2018. Though the Session Court confirmed the conviction of the accused, it reduced to the fine amount to Rs.5,55,000/- and directed a sum of Rs.5,50,000/- paid to the complainant by way of compensation.
10. Unfortunately complainant has not challenged the order of the Sessions Court reducing the fine amount.
11. Aggrieved by the concurrent findings of the trial Court and Sessions Court, the accused has come up with this petition contending that the judgment and sentence passed by both Courts are illegal, improper, capricious and not in accordance with law. It is therefore liable to be set aside. Complainant failed to prove the proprietorship of Suraksha Petro services. The Courts below have not appreciated this aspect. They have gravely erred in not understanding the statutory importance of Section 118 and 139 of N.I. Act and by mis-applying the same to the evidence on record resulted in convicting the accused. The presumption under Section 118 and 139 of the N.I Act is wrongly applied. The reasons assigned are not convincing. The impugned judgment and order are perverse, capricious and liable to be set aside and hence the petition.
12. In support of his arguments, learned counsel for accused has relied upon the following decisions:
(i) G.H. Abdul Kadri vs. Mr.Mohammed Iqbal (Abdul Kadri), Crl.R.No.1323/2019 C/w 1338/201, 1342/2019, 1403/2019, 1405/2019 & 1352/2019 Dt: 24.5.2022
(ii) Rajaram, S/o Sriramulu Naidu (Since deceased) Through LRs. vs. Maruthachalam (Since deceased) through LRs. (Rajaram), 2023 Livelaw (SC) 46
(iii) Sri. Dattatraya vs. Sharanappa (Dattatraya), Crl.A. No.3257/2024 (SLP (Crl) No.13179/2023)
(iv) Sushil Kumar Churiwala vs. Akshay Bansal (Sushil Kumar Churiwala), Crl. RP. No.1043/2022 DD: 10.12.2024
(v) Nagappa vs. N.H. Omprakash (Nagappa), Crl.RP.No.1140/2021 DD: 17.02.2025
13. On the other hand, learned Am
When any document is required to be served by post, service shall be deemed to be effected by properly addressing, preparing and posting by registered post a letter containing the document.
The presumption under Section 139 of the Negotiable Instruments Act places the burden of proof on the accused to rebut claims of debt, failure to do so solidifies conviction for dishonored cheques.
The existence of an enforceable debt is presumed under Section 139 of the NI Act but can be rebutted if the accused raises a probable defence against part of the claim.
The provisions of Section 138 of the Negotiable Instruments Act apply when issued cheques are dishonored due to insufficient funds, thus reinforcing the legal obligation of repayment.
The appellate court cannot enhance a sentence beyond that imposed by the trial court, and fines under the Negotiable Instruments Act must not exceed statutory limits.
The court emphasized the importance of substantiated evidence in rebutting the presumption under Section 139 of the N.I. Act and upheld the conviction based on the evidence presented.
The compensatory nature of the offense under Section 138 of the NI Act and the legislative intent to deter dishonour of cheques influenced the court's decision in setting aside the additional fine im....
The accused failed to rebut the presumption under the Negotiable Instruments Act regarding cheque dishonor, leading to conviction, while the fine imposed was deemed excessive and modified.
The court reaffirmed statutory presumptions under the NI Act regarding cheque liability, emphasizing the evidentiary burden on the accused.
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