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2025 Supreme(Online)(KAR) 5534
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
SHIVASHANKAR AMARANNAVAR, J
H V Jagannatha S/o Sri.h.r.vageesha – Appellant
Versus
Prabhakar B J S/o B.k.jayanna – Respondent
CRIMINAL APPEAL No. 533 OF 2015
For the Appellant :SRI GURURAJ KULKARNI, ADVOCATE
For the Respondent:SRI D P PRASANNA, ADVOCATE
The presumption of issuance of cheques for a legally enforceable debt is rebuttable, and the complainant must prove the debt when the presumption is challenged.
Headnote:(A) Negotiable Instruments Act, 1881 - Section 138 - Acquittal of accused for dishonor of cheques - Complainant alleged that accused borrowed Rs.6,35,000/- and issued cheques for repayment - Cheques returned dishonored - Acquittal upheld as complainant failed to establish lending capacity and specific dates of borrowing - Presumption under Section 139 rebutted by accused's defense. (Paras 1, 8, 11, 16)
(B) Burden of Proof - The presumption of issuance of cheques for legally enforceable debt is rebuttable; the burden shifts to the complainant to prove the debt when the presumption is rebutted. (Paras 11, 16)
Facts of the case:
The complainant claimed that the accused borrowed money for vehicle purchases and issued cheques, which were dishonored. The accused contended that the cheques were issued as security for another loan. The complainant did not provide evidence of lending capacity or specific borrowing dates.
Findings of Court:
The learned Magistrate acquitted the accused, finding that the complainant did not establish the alleged lending or his capacity to lend the amount claimed.
Issues: Whether the learned Magistrate erred in acquitting the accused under Section 138 of the N.I. Act?
Ratio Decidendi: The court affirmed that the presumption of issuance of cheques is rebuttable, and the complainant failed to provide sufficient evidence to establish the debt or his capacity to lend.
Result: Appeal dismissed.
ORAL JUDGMENT
This appeal is filed by the complainant challenging the judgment of acquittal dated 19.03.2015 passed in C.C.No.29728/2010 by the XXIII Additional CMM, Bangalore, whereunder, the respondent/accused has been acquitted for the offence punishable under Section 138 of Negotiable Instruments Act, 1881 (for short'the Act').
2. The case of the complainant is that he and accused are friends and accused had borrowed a sum of Rs.6,35,000/- from him, on different dates for the purpose of purchasing vehicles and for family necessities and whereas the respondent/accused for making payment of the said amount borrowed, has issued three cheques bearing No.618918 dated 26.11.2009 for Rs.15,000/-, cheque bearing No.618919 dated 26.12.2009 for Rs.15,000/- and cheque bearing No.618915 dated 21.01.2010 for Rs.6,05,000/- in favour of the complainant. The complainant presented all the three cheques for encashment, that the said cheques were returned dishonoured with endorsement "Funds insufficient in the account of the accused". The complainant got issued legal notice to the respondent/accused calling upon him to pay the amount of the cheques and it has been served on him. The respondent/accused did not pay the amount of cheques and therefore, the appellant/complainant has filed complaint against the respondent/accused for offence under Section 138 of the Act.
3. Learned Magistrate has taken cognizance and registered C.C.No.29728/2010 against the respondent/accused for offence punishable under Section 138 of the N.I. Act. The plea of the respondent/accused has been recorded. The complainant has examined himself as PW.1 and got marked Exs.P1 to P8. The statement of the respondent/accused has been recorded under Section 313 of Code of Criminal Procedure. The respondent/accused has not led any defence evidence. Learned Magistrate after hearing the arguments on both sides has formulated points for consideration and passed the judgment of acquittal. The said judgment of acquittal has been challenged by the appellant/complainant in this appeal.
4. Heard learned counsel for appellant and learned counsel for respondent.
5. Learned counsel for appellant would contend that respondent/accused has admitted his signature on cheques Exs.P1 to P3 and therefore, presumption under Section 139 of the N.I. Act has to be drawn, that the cheques have been issued for making payment of legally enforceable debt. The said presumption is a rebuttal presumption. The respondent/accused, who had taken the defence that the cheques have been issued as a security to the loan of one Venkatesh availed from the complainant has not been established. Therefore, the said presumption is not rebutted. Without considering these aspects, the learned Magistrate has harped upon the capacity of the complainant and erred in acquitting the respondent/accused. On these grounds he prayed for allowing the appeal and convicting the respondent/accused for offence under Section 138 of the Act.
6. Learned counsel for the respondent submits that PW.1 in his cross-examination has admitted that one Venkatesh was working as a Driver under him, and he has availed loan from him. PW.1 in his cross-examination has denied the suggestion that accused has issued three signed cheques as a security to the loan availed by the said Venkatesh, from him. PW.1 in his cross examination has admitted that the cheques given by the accused were signed blank cheques and he has filled in the contents of the cheques. The said aspects itself probablises the defence of the respondent/accused, that appellant/complainant has not placed on record any document regarding his capacity to lend huge amount of Rs.6,35,000/-. That the appellant/ complainant has not produced any document to show that the respondent/accused has borrowed Rs.6,35,000/-.
7. Learned counsel for appellant further submits that the specific dates of borrowing are not stated either in the complaint, notice and evidence of PW.1. Respondent/accused has
