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2026 Supreme(Online)(Kar) 31251
THE HIGH COURT OF KARNATAKA
V Srishananda, J
Manjunatha – Appellant
Versus
J. Bhasker – Respondent
CRL.RP No. 1161 of 2018
For the Appellants/Petitioners: M. Y. Lokesha
For the Respondents: Anjana Murthy H.
In proceedings under Section 138 of the Negotiable Instruments Act, once the complainant proves the cheque issuance and dishonour, the statutory presumptions under Section 118 and 139 shift the burden to the accused to rebut the existence of debt, and failure to do so results in conviction.
Headnote:(A) Negotiable Instruments Act, 1881 - Sections 138, 139 and 118 - Cheque bounce - Presumption of liability - The court emphasized that unless the contrary is proved, a cheque is presumed to be issued for discharge of a debt or liability - Accused failing to rebut the presumption under Section 139 despite cross-examination and adducing evidence cannot evade conviction, especially when signatures on the instrument and the transaction are not effectively denied. (Paras 31, 33, 35)
(B) Appellate Review - Limitation of scope - Re-appreciation of evidence in revision is restricted when the trial Court and First Appellate Court have concurrently found the guilt based on material evidence - No error of law or jurisdictional defect warranting interference with the conviction. (Paras 6, 11, 18)
Facts of the case:
The petitioner (accused) borrowed a total loan of Rs. 50,00,000/- from the respondent (complainant) for business purposes and real estate transactions. Towards repayment, the accused issued a cheque which was dishonoured upon presentation due to a 'stop payment' instruction. The trial court convicted the accused under Section 138 of the Negotiable Instruments Act, which was affirmed by the First Appellate Court. The petitioner sought to challenge this, alleging that Rs. 13,00,000/- had been paid and not credited.
Findings of Court:
The Court found that the petitioner failed to prove that the alleged payments were made after the cheque issuance or that they should be deducted from the liability. Evidence supported the original transaction, and the presumption under the NI Act remained unrebutted.
Issues: Whether the Trial Court and First Appellate Court were justified in convicting the accused under Section 138 of the NI Act, and whether the alleged part-payments were sufficient to rebut the presumption of liability.
Ratio Decidendi: Once the complainant establishes the ingredients of Section 138 (dishonour of cheque for legal liability), the statutory presumptions under Sections 118 and 139 shift the burden to the accused to prove the non-existence of debt; if the accused fails to provide sufficient evidence to rebut this, conviction must follow.
Result: Criminal Revision Petition is dismissed.
| Table of Content |
|---|
| 1. overview of concurrent convictions and trial proceedings under section 138 ni act. (Para 2 , 3 , 4 , 5 , 6) |
| 2. arguments regarding part-payment and failure of courts to account for ledger entries. (Para 7 , 8 , 9 , 10) |
| 3. court affirmation of guilt through statutory presumptions and rejection of insufficient rebuttal evidence. (Para 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19) |
THIS CRIMINAL REVISION PETITION IS FILED UNDER SECTION 397 R/W 401 CODE OF CRIMINAL PROCEDURE PRAYING TO SET ASIDE THE JUDGMENT DATED 27.09.2018, PASSED BY THE LXIV ADDITIONAL CITY CIVIL AND SESSIONS JUDGE (CCH-65) AT BANGALORE IN CRL.A.No.738/2016, CONFIRMING THE JUDGMENT DATED 01.06.2016 IN C.C.No.17312/2012 ON THE FILE OF THE XIX ACMM, BANGALORE CITY AND ACQUIT THE PETITIONER.
THIS PETITION, COMING ON FOR HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE V SRISHANANDA
ORAL ORDER
Heard Sri M.Y. Lokesha, learned counsel for the revision petitioner and Sri Anjana Murthy H., learned counsel for the respondent.
2. Accused who suffered an order of conviction dated 01.06.2016 in C.C.No.17312/2012, on the file of XIX Additional Chief Metropolitan Magistrate, Bengaluru, confirmed in Criminal Appeal No.738/2016, dated 27.09.2018, on the file of LXIV Additional City Civil and Sessions Judge at Bengaluru is the revision petitioner.
3. Facts in the nutshell which are utmost necessary for disposal of the present petition are as under:
3.1. A private complainant under Section 200 of code of Criminal Procedure came to be filed alleging the commission of the offence punishable under Section 138 of the Negotiable Instruments Act, contending that accused was a tenant under the complainant in respect of the land and intended to purchase a land bearing Sy.No.74/3, measuring 19 guntas, situated at Neralur village of Anakal Taluk.
3.2. The said talks were in the month of October 2011 and for said purpose, accused borrowed loan of Rs.30,00,000/- on 12.11.2011, got registered a property on 26.12.2011. Subsequently, he again borrowed sum of Rs.9,50,000/- on 31.12.2011 and yet another amount of Rs.10,50,000/- on 20.01.2012 for improvement of his business and he acknowledged total hand loan of Rs.50,00,000/- from the complainant with a promise to repay the same.
3.3. Towards the repayment, he issued a Cheque bearing No.195173, dated 10.04.2012, which on presentation came to be dishonored with an endorsement “payment stopped/stop order”.
3.4. Callings of the legal notice was not complied. Therefore, action was sought.
4. Learned Trial Magistrate after completing necessary formalities summoned the accused and after due trial, convicted the accused holding in paragraphs 31 to 36 as under :
31. The oral evidence adduced before this court by the accused is not convinced this court and it will not rebut the case of the Complainant and also his oral and documentary evidence as well as it will not rebut the presumption available to this Complainant u/Sec.139 of N.I. Act. The accused has utterly failed to prove that there was no any loan transaction in between him with this Complainant much less amounting to Rs.50,00,000/- and he has not issued the Ex.P1 cheque towards repayment of the debt or other liability. In such situation, the defence taken by the accused during the course of trial, cannot be believable and acceptable. Even when this accused was questioned u/Sec.313 of Cr.P.C. by this court, accused except denying incriminating evidence deposed against him by PW1, has not chosen to put forth any defence from his side. Likewise, the Accused has utterly failed to rebut the presumption available to this Complainant u/Sec.118 and also u/Sec.139 of N.I. Act it reads thus respectively.
32. As per the provisions of Sec.118, which reads thus:
a. Of consideration – that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, ind
