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2025 Supreme(Online)(KAR) 5942
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
MR JUSTICE SHIVASHANKAR AMARANNAVAR, J
M/s Shriram Transport Finance Co., Ltd. – Appellant
Versus
Radha Dayananda W/o Late B.dayananda Rao – Respondent
CRIMINAL APPEAL No. 781 OF 2014
Advocate Appeared:
For the Appellant :SRI M J ALVA, ADVOCATE
For the Respondent:SRI VEERESH M UPPIN, ADVOCATE FOR SRI K CHANDRANATH ARIGA, ADVOCATE
The presumption under Section 139 of the N.I. Act can be rebutted by the accused, shifting the burden of proof back to the complainant to establish the existence of a legally enforceable debt.
Headnote:(A) Negotiable Instruments Act, 1881 - Section 138 and 139 - Appeal against acquittal - Complainant alleged dishonor of cheque issued for loan repayment - Respondent claimed loan was repaid and cheque was misused - Presumption under Section 139 rebutted by evidence of repayment and discrepancies in documents - Acquittal upheld as no grounds for interference found. (Paras 1-9)
(B) Burden of proof - The burden lies on the complainant to prove that the cheque was issued for a legally enforceable debt, which was not discharged. (Paras 5-6)
(C) Evidence - Non-production of documents directed by the court leads to adverse inference against the complainant. (Paras 8-9)
Facts of the case:
The appellant, a public limited company, filed a complaint against the respondent for dishonor of a cheque issued for loan repayment. The cheque was dishonored due to insufficient funds, and despite a legal notice, the amount was not paid.
Findings of Court:
The learned Magistrate acquitted the respondent, finding that the presumption of the cheque being issued for a legally enforceable debt was rebutted by the respondent's evidence of repayment and discrepancies in the complainant's documents.
Issues: Whether the learned Magistrate erred in acquitting the respondent for the offence under Section 138 of the N.I. Act?
Ratio Decidendi: The court held that the presumption under Section 139 of the N.I. Act was rebutted by the respondent, and the complainant failed to prove the existence of a legally enforceable debt.
Result: Appeal dismissed.
Act Referred
ORAL JUDGMENT
This appeal is filed by the complainant challenging the judgment of acquittal dated 08.07.2014 passed in C.C.No.524/2008 by the JMFC Vth Court, Mangaluru, whereunder the respondent -accused has been acquitted for the offence punishable under Section 138 of Negotiable Instruments Act, 1881 (hereinafter referred to as “N.I. Act” for brevity).
2. The brief facts of the appellant -complainant’s case is that
The appellant –complainant is Public Limited Company doing money lending business. The respondent –accused has availed loan and executed hypothecation agreement with respect to his vehicle KA-19-AC-4047. In order to repay the said amount, the respondent –accused has issued cheque bearing No.978384 dated 27.09.2007 for Rs.3,70,000/-. The appellant –complainant presented the said cheque for encashment and same came to be dishonoured for ‘want of funds’. The appellant has issued legal notice. Inspite of service of notice the respondent – accused did not pay the cheque amount. Therefore, the appellant -complainant has filed private complaint against the respondent –accused for offence punishable under Section 138 of Negotiable Instruments Act, 1881 .
3. Learned Magistrate took cognizance and registered case against the respondent –accused for offence punishable under Section 138 of N.I.Act in C.C.No.524/2008. The plea of the respondent –accused has been recorded. The complainant in order to prove its case has examined its representative as P.W.1 and got marked documents as Ex.P1 to P11. The statement of accused came to be recorded under Section 313 of Cr.P.C. The respondent –accused’ s son who is her GPA holder has examined as D.W.1 and got marked documents as Ex.D1 to D33. Learned Magistrate after hearing on both sides has formulated points for consideration and passed impugned judgment of acquittal. The said judgment of acquittal has been challenged by the complainant in this appeal.
4. Heard learned counsel for the appellant and learned counsel for the respondent.
5. Learned counsel for the appellant would contend that the respondent –accused has admitted availing loan in her reply notice –Ex.P7 wherein it is contended that cheque has been issued at the time of availing loan. As the cheque has been admitted by the respondent –accused the presumption under Section 139 of the N.I Act requires to be drawn that the cheque has been issued for making payment of legally enforceable debt. He further submits that Ex.P10 is the loan cum hypothecation agreement between the appellant and respondent. Ex.P11 is statement of account which indicates that balance amount is Rs.3,73,238.19/-. The cheque has been issued for Rs.3,70,000/- and it is the balance amount. He further submits that learned Magistrate has swayed away by the documents i.e. Ex.D9 to 33 which pertains to the year prior to loan agreement – Ex.P10. He submits that Ex.D3 –Arbitration award produced by the respondent –accused itself indicate the balance amount the same which is mentioned in the Ex.P11 –statement of account. He places reliance on following decisions
1) Dashrathbhai Trikambhai Patel Vs Hitesh Mahendrabhai Patel and Another,
2) T. Vasanthakumar Vs Vijayakumari,
3) K.S. Ranganatha Vs Vittal Shetty,
4) Rangappa Vs Mohan,
5) VGP Marine Kingdom Private Limited and Another Vs Kay Ellen Arnold,
Placing reliance on said decisions learned counsel for the appellant submits that burden is on the respondent – accused to rebut the presumption drawn under Section
6. Learned counsel
