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2023 Supreme(Online)(KAR) 4635
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IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 9TH DAY OF JANUARY, 2023
BEFORE
THE HON'BLE MR JUSTICE RAJENDRA BADAMIKAR
CRIMINAL APPEAL NO.2777/2012
BETWEEN:
BABUSAB S/O MEHABOOBSAB
BISARALLI, AGE: 50 YEARS,
R/O: KOPPAL, TQ AND DIST: KOPPAL.
…APPELLANT
(BY SRI R. M. JAVED, ADVOCATES)
AND:
UDAYKUMAR S/O BHIMASEN RAO MUTAGI
AGE 41 YEARS, R/O: WARKAR STREET, KOPPAL
AND AT H.NO.8-11-181/5,
PANCHAMUKI COLONY, VASANI NAGAR,
RAICHUR, DIST: RAICHUR.
…RESPONDENT
(BY SMT. DEEPA P., ADVOCATE FOR
SRI MRUTHYUNJAY TATA BANGI, ADVOCATE)
THIS CRIMINAL APPEAL IS FILED U/S 378(1) OF CR.P.C.,
SEEKING TO SET ASIDE THE ORDER PASSED BY THE CIVIL
JUDGE AND JMFC., COURT, KOPPAL, IN C.C.NO.573/2007
DATED 04.03.2011 AND THE RESPONDENT BE CONVICTED FOR
THE
OFFENCES
PUNISHABLE
UNDER
SECTION
138
OF
NEGOTIABLE INSTRUMENTS ACT, 1881.
THIS APPEAL COMING ON FOR FINAL HEARING, THIS
DAY, THE COURT MADE THE FOLLOWING:
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The presumption under Section 139 of the Negotiable Instruments Act, 1881, is only available if the complainant establishes his financial status to advance the loan.
Headnote:
NEGOTIABLE INSTRUMENTS ACT, 1881 - SECTION 138 - ACQUITTAL - APPEAL - FINANCIAL STATUS OF COMPLAINANT
Fact of the Case:
The complainant alleged that the accused borrowed Rs. 3,50,000/- from him in February 2007 and issued a cheque towards the debt, which was dishonored due to insufficient funds. The accused denied the loan and claimed that he had issued a stop payment instruction to the bank. The Trial Court acquitted the accused, holding that the complainant failed to prove his financial status to advance such a large loan.
Finding of the Court:
The High Court upheld the acquittal, finding that the complainant failed to establish his financial status to advance the loan. The Court noted that the complainant's claim that he had withdrawn the loan amount from his bank account three months prior to the loan was not supported by any documentary evidence. The Court also noted that the accused had produced evidence of a stop payment instruction issued to the bank.
Issues: Whether the Trial Court erred in acquitting the accused for the offence under Section 138 of the Negotiable Instruments Act, 1881.
Ratio Decidendi: The presumption under Section 139 of the Negotiable Instruments Act, 1881, which shifts the burden of proof to the accused, is only available if the complainant establishes his financial status to advance the loan. In this case, the complainant failed to prove his financial status, and therefore, the presumption under Section 139 did not arise.
Final Decision: The appeal was dismissed, and the acquittal of the accused was upheld.
This appeal is filed by the appellant-complainant
under Section 378(1) of the Criminal Procedure Code,
1973 (for short, hereinafter referred to as ‘Cr.P.C.’)
challenging the judgment of acquittal passed by the Civil
Judge and JMFC., at Koppal in C.C. No.573/2007 dated
04.03.2011 whereby the learned Magistrate has acquitted
the accused for the offence punishable under Section 138
of Negotiable Instruments Act, 1881.
2.
For the sake of convenience, the parties herein
are referred with the original ranks occupied by them
before the Trial Court.
3.
The brief factual matrix leading to the case are
that, the complainant and accused are the resident of
Koppal and they are friends. It is further alleged that in
furtherance of the friendship, the accused has sought
financial assistance from the complainant for expansion of
his flour mill business to the tune of Rs.3,50,000/- and
accordingly, in February, 2007 the complainant has
advanced a hand loan of Rs.3,50,000/-. When the
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complainant has demanded repayment of the hand loan
after one month, the accused has issued a cheque dated
16.03.2007 as per Ex.P.1 towards discharge of legally
enforceable debt. The complainant has presented the said
cheque and the said cheque came to be dishonored for
insufficient of funds. Thereafter, the complainant has got
issued a legal notice by registered post as well as under
certificate of posting and the notice issued under the
registered post returned as refused. It is further asserted
by the complainant that the accused having knowledge
that he has insufficient funds has issued cheque in favour
of complainant towards legally enforceable debt and
thereby committed an offence punishable under Section
138 of Negotiable Instruments Act, 1881.
4.
The complainant lodged a private complaint
under Section 200 of Cr.P.C. and the learned Magistrate
after recording the sworn statement, had taken cognizance
and issued process against the accused. The accused has
appeared and was enlarged on bail. The prosecution
papers were also furnished to him. The accusation was
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read over and explained to him and he pleaded not guilty
and claimed to be tried.
5.
The complainant was examined as PW1 and one
witness was examined as PW2 on behalf of the
complainant. The complaint has also placed reliance on 8
documents marked as Ex.P.1 to Ex.P.8. After conclusion
of the evidence of the prosecution, the statement of
accused under Section 313 Cr.P.C. is recorded to enable
him to explain the incriminating evidence appearing
against him in the case of the prosecution. The case of
the accused is of total denial and got examined himself as
DW1 and placed reliance on Ex.D1 during the cross
examination of DW1 and Ex.D2 is also got marked.
6.
After hearing the arguments, the learned
Magistrate has found that the complainant has failed to
prove the guilt of the accused beyond all reasonable
doubts for the offence punishable under Section 138 of the
Negotiable Instruments Act, 1881 and by exercising the
powers under Section 255(1) of Cr.P.C acquitted the
accused. Hence, this appeal.
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7.
Heard the arguments advanced by the learned
counsel for the appellant and the learned counsel for the
respondent-accused. Perused the records.
8.
The learned counsel for the appellant would
contend that, the accused has issued a cheque and his
signature on the cheque is undisputed and as such there is
a presumption under Section 139 of the Negotiable
Instruments Act, 1881. He would also submit that the
accused in spite of issuance of notice refused the notice
issued under registered post and the notice issued under
certified posting was served and he failed to reply to
substantiate his contention and as such he would contend
that the Trial Court ought to have drawn presumption in
favour of complainant and ought to have convicted the
accused. Hence, he would seek for allowing the appeal by
convicting the accused-respondent herein.
9.
Per
contra,
the
learned
counsel
for
the
re
