Bangalore District Court
G Srinivas vs Narayana Poojari on 9 October, 2025
KABC020065632023
IN THE COURT OF THE XII ADDL. JUDGE, COURT OF
SMALL CAUSES & ADDL. CHIEF JUDICIAL MAGISTRATE,
BENGALURU (SCCH-08)
DATED THIS THE 9th DAY OF OCTOBER - 2025
PRESENT: Smt. Kannika M.S.
M.A., LL.B.
XII ADDL. SCJ & ACJM
MEMBER - MACT, BENGALURU.
C.C. No.2518/2023
Complainant : Mr. G. Srinivas,
S/o. Late N. Govindaswamy,
Aged about 39 years,
R/at No.21,
Ramamurthy Road,
Harijana Colony,
7th Cross, 7th Main,
Srirampuram,
Bengaluru - 560021.
(By Sri. K.A. Prakash, Advocate)
:Vs:
Accused : Mr. Narayana Poojari,
S/o. Hariyakka,
Aged about 33 years,
R/at no.1-306,
Doddammanamane Heranjalu,
SCCH-8 2 C.C.No.2518/2023
Kundapura Taluk,
Udupi District - 576 219.
(By Sri. Manjunatha Reddy C.,
Advocate)
Date of complaint : 18.01.2023
Date of commencement of
Evidence : 06.03.2023
Offence charged : Sec.138 of Negotiable
Instruments Act
Date of Judgment : 09.10.2025
Opinion of the Judge : Accused found guilty
JUDGEMENT
This is a private complaint filed U/Sec.200 of Cr.P.C. against the accused for the alleged offence punishable U/Sec.138 of Negotiable Instrument Act.
2. The brief facts of the case of the complainant is that:
The accused and complainant were known to each other for about 2 years and by virtue of acquaintance on SCCH-8 3 C.C.No.2518/2023 13.02.2021 accused took Rs.1,68,000/- from the complainant for medical emergency of his son with a promise to return the same within one year. Again on 11.05.2022 accused has taken a sum of Rs.2,32,000/- from the complainant with a promise to take him as partner in M/s. Manjunath Juice and Chats centre' which is run by accused. When the complainant demanded to return the amount, the accused issued a cheque bearing No.612652, dated 14.11.2022 for Rs.4,00,000/- drawn on M/s.
Karnataka Bank Ltd., Srirampuram Branch, Bengaluru in favor of complainant. As per the instruction of the accused, complainant presented the said cheque for encashment through his banker, but the said cheque came to be dishonored and returned with shara "Cheque Destroyed". Hence the complainant has issued legal notice on 12.12.2022 through RPAD to the accused address and the same was served on 14.12.2022 to the Bengaluru local address. The accused has not paid the amount, and hence, SCCH-8 4 C.C.No.2518/2023 the complainant has filed the present complaint before this Court.
3. Cognizance was taken and sworn statement of the complainant was recorded. Since there were sufficient materials to proceed against the accused, the summons was issued to the accused. Accused appeared through his counsel and got enlarged on bail. Substance of accusation was framed, read over and explained to the accused in the language known to him, he denied the same and claimed to be tried. Hence, the case was posted for complainant's evidence.
4. In order to prove his case, the complainant got examined himself as PW-1 and got marked 10 documents at Ex.P1 to Ex.P10 and closed his evidence. After closure of complainant's side evidence, the statement U/Sec.313 of Cr.P.C was prepared and read over to accused, he has denied the same. The accused has not led his defence evidence. Thereafter, case was posted for arguments. SCCH-8 5 C.C.No.2518/2023
5. I have heard the arguments of learned counsel for the complainant and perused the written arguments submitted by the learned accused counsel. Perused the entire records in this case.
6. The following points arise for my consideration:
1. Whether the complainant proves that, the accused has issued the cheque bearing No. 612652 dated 14.11.2022, for a sum of Rs.4,00,000/- drawn on M/s. Karnataka Bank Ltd., Srirampuram Branch, Bengaluru and the complainant presented the said cheque for encashment, but the said cheque returned on 28.11.2022 with an endorsements as "Cheque Destroyed" ?
2. Whether the complainant further proves that he has got issued the legal notice dated:
12.12.2022 to the accused demanding the cheque amount from the Accused within 15 days from the date of receipt of the notice, the said legal notice is duly served on the accused, but the accused has failed to make the payment of the cheque amount well within the prescribed time and there by committed an offence punishable under section 138 of Negotiable Instrument Act?
3. What order?SCCH-8 6 C.C.No.2518/2023
7. The finding of this court on the above points is as under:
Point No.1 : In Affirmative
Point No.2 : In Affirmative
Point No.3 : As per final order
for the following;
REASONS
POINTS NO.1 & 2:
8. Since these points are interconnected, they are taken up together to avoid repetition of facts.
9. According the complaint, accused borrowed in total Rs.4,00,000/- from him, but thereafter accused has not paid the amount. Hence the complainant demanded to return the amount and towards discharge of the liability, the accused issued a cheque bearing Nos.612652 and when complainant presented it for realization through his banker and the said cheque dishonored and returned with shara "Cheque Destroyed " on 28.11.2022, hence he issued the legal notice to the accused on 12.12.2022 through RPAD SCCH-8 7 C.C.No.2518/2023 and the same was served. The accused has not paid the amount, hence the complaint.
10. In support of his contention complainant has filed affidavit in lieu of examination in chief wherein reiterated the averments of the complaint and examined as PW.1 and got marked EX P1 to P10 documents. Ex.P1 is the Loan agreement, Ex.P2 and 3 are the On-demand promissory note and payment receipt, Ex.P4 is the cheque bearing Nos.612652 dated 14.11.2022 for Rs.4,00,000/- issued by the accused in favour of the Complainant. Ex.P5 is the Bank endorsement dated:28.11.2022 issued by the Bank with respect to the dishonour of the said cheque. It is shows that cheque is dishonored for the reason Cheque Destroyed. Ex.P6 is the legal notice dated 12.12.2022 issued by the complainant through his counsel to the accused for the repayment of the said loan amount. Ex.P7 & 8 are the Postal receipts, Ex.P9 is the postal acknowledgment and Ex.P10 is the returned RPAD cover. Ex.P.4 to Ex.P.10 documents goes SCCH-8 8 C.C.No.2518/2023 to show that the legal notice sent to the accused was served to his local Bengaluru address. The accused has not repaid the amount. Thereafter complainant has filed this case against the accused on 18.01.2023. Hence, complainant has complied the mandatory requirements of Sec.138 of N.I. Act.
11. On the other hand, the accused has not examined himself before the court and not marked any documents on him behalf.
12. Let me discuss whether the amount mentioned in the cheque is for a legally recoverable debt or for other liability. The interpretation of the expression for discharge of any debt or other liability occurring in section 138 of N.I. Act is significant and decisive in matter. The explanation appended to section 138 express the meaning of the expression debt or other liability for the purpose of section
138. This expression means a legally enforceable or other liability. Section 138 treats dishonour of cheque as an offence if the cheque has been issued in discharge of debt or SCCH-8 9 C.C.No.2518/2023 any other liability. The explanation leaves no manner of doubt that to attract an offence under section 138 there should be legally enforceable debt or other liability. As per section 139 of N.I. Act there is a presumption in favour of the complainant that the cheque was issued for discharge of debt or other liability. The said presumption is a legal presumption and it is in favour of the holder of cheque. It is open to the accused to rebut the said presumption. The accused has not rebut the presumptions which is available in favour of the complainant.
13. It is the mandate of Section 139 that there is a presumption in favour of the holder of the cheque that the holder received the cheque of the nature referred to in section 138, for the discharge in whole or in part or other liability. Needless to mention that the presumption contemplated under section 139 of N.I. Act is a rebuttable presumption. However the onus of proving that the cheque was not in discharge of any debt or other liability is on the SCCH-8 10 C.C.No.2518/2023 drawer of the cheque/accused. In Hiten P. Dalal V/s Bratindranath Banerjee reported in 2001 (6) SCC 16 the Hon'ble Supreme Court held that both section 138 and 139 require that the court shall presume the liability of the drawer of the cheque for the amounts for which the cheque are drawn.
Section 139 introduces an exception to the general rule as to the burden of proof and shifts the onus on the accused. The presumption under section 139 of N.I. Act is a presumption of law, as distinguished from presumption of facts.
In Laxmi Dyechem V/s State of Gujarat and others reported in 2012 (13) SCC 375 , the Hon'ble Supreme court reiterated that in view of section 139 it has to be presumed that a cheque was issued in discharge of a debt or other liability but the presumption could be rebutted by adducing evidence. The burden of proof was however on the person who wanted to rebut the presumption. SCCH-8 11 C.C.No.2518/2023
In K.N. Beena V/s Muniyappan and Anothers reported in 2001(8) SCC 458, the Hon'ble Supreme court held that in view of the provisions of section 139 of the N.I.Act read with section 118 thereof the court had to presume that the cheque had been issued for discharging a debt or liability. The said presumption was rebuttable and could be rebutted by the accused by proving the contrary. The accused had to prove by cogent evidence that there was no debt or liability.
14. The accused counsel in the cross-examination of the PW.1 has taken defence that the complainant has no capacity to lend the loan, the alleged cheque was given to the complainant in the year 2019 when accused has borrowed the loan of Rs.1,00,000/-, it was misused by the complainant and filed false case, the complainant has denied the suggestions of the accused counsel. Complainant has also produced the loan agreement and On-demand promissory note and consideration receipt, which were SCCH-8 12 C.C.No.2518/2023 executed by the accused for repayment of loan of Rs.4,00,000/- on 11.05.2022, which were marked as Ex.P1 to 3. the accused has not denied the signatures on the said document, but contending that complainant has taken his signature on blank document and then created those documents. To substantiate his defence accused has not examined any other witnesses and documents. Therefore, without production of the documentary and oral evidence mere contention is not believable.
15. PW.1 in his cross-examination stated that he was working in incense stick from 2006 to 2016 and getting salary of Rs.3,000 to 4,000/- per week. From his savings he has lent the loan to the accused as per his request. The evidence of Pw.1 clears that complainant had capacity to lend the loan.
16. The accused counsel in the cross examination denied the receipt of notice but accused has not stepped into the witnesses box to lead his defence to elicit the truth SCCH-8 13 C.C.No.2518/2023 regarding his address by the complainant and also accused has not produced any document to show that he was not residing in the address shown in the notice. As per Section 27 of General Clauses Act, there is a presumption that if the communications or letters are sent to the address wherein the person ordinarily resides or carries on his business, it is presumed to be valid service. As per Ex.P5 which is the Postal cover there was a shara 'refused' it is deemed to be served and also makes it clear that accused has got the knowledge about the notice, but he has not issued any reply. When he kept quite regarding the notice of the complainant and not issued the reply notice after getting to know about the notice, there is no need to the complainant to prove his financial capacity. At this stage this Court has relied on decision rendered by the Hon'ble Supreme Court in Tedhi Sing V/s Narayan Das Mahant(Tedi Singh) 2022 SCC Online SC302, in this case Court held that, "Where the accused has failed to send reply to the legal notice, challenging the financial capacity of the SCCH-8 14 C.C.No.2518/2023 complainant, at the first instance, complainant need not prove his financial capacity".
The above said decision is aptly applicable to this case on hand, when the accused has kept quite without issuing the reply at the very earlier stage available to him to put forth his defence, he has no right to question the financial capacity of complainant.
17. In the cross-examination of PW.1 by the accused counsel suggested that "accused has obtained the loan of Rs.1,00,000/- from the complainant in the year 2019 and given the Ex.P1 cheque as a security, then he repaid the loan amount to complainant." the said suggestion was denied by the PW.1. Accused has not produced any document to prove the said defence. The accused counsel has not denied the signatures on the loan agreement, On- demand pronote, consideration receipt and cheque and he suggested that "ಖಾಲಿ ಸ್ಟಾಂಪ್ ಪೇಪರ್ನಲ್ಲಿ ಆರೋಪಿಯ ಸಹಿ ಪಡೆದು, ಅದರಲ್ಲಿ ಸಾಲದ ಕರಾರು ಎಂದು ನಾನು ಸೃಷ್ಟಿ ಮಾಡಿದ್ದೇನೆ ಮತ್ತು ಖಾಲಿ ಪ್ರಾ ಮಿಸ್ಸರಿ ನೋಟ್ಗೆ ಕೂಡ SCCH-8 15 C.C.No.2518/2023 ಆರೋಪಿಯಿಂದ ಸಹಿ ಪಡೆದು, ಈ ರೀತಿ ಸೃಷ್ಟಿ ಮಾಡಿದ್ದೇನೆ ಹಾಗೂ ಚೆಕ್ಕಿ ನಲ್ಲಿರುವ ಸಹಿಯನ್ನು ಹೊರತುಪಡಿಸಿ ಉಳಿದ ಬರವಣಿಗೆಗಳನ್ನು ನಾನೇ ಬರೆದುಕೊಂಡಿದ್ದೇನೆ". Pw1 has denied the said suggestion. These suggestions clears that accused admitted the signatures on the said documents and accused has not suggested the Pw.1 in the cross- examination about the blank signed stamp papers and promissory note also taken at the time of borrowing of the loan of Rs.1,00,000/-, but suggested those were created, the said defence of the accused is not believable.
18. Another contention raised by the accused is that the complainant filled the details in the cheque, other documents and presented the cheque to the bank. As per Sec. 20 of N.I. Act, singed blank cheque is inchohate instrument and any claim based on inchohate instrument will be subject to the provisos of Sec.20. But when the instrument is cheque, presumption U/Sec. 139 shall have to be drawn. But the presumption is being rebuttable. SCCH-8 16 C.C.No.2518/2023
19. I have also gone through the ruling reported in; AIR 2000 Karnataka Page 169 (H. Marigouda /Vs/ Tippamma & others), which reads is as follows;
" As per Sec. 20 of N.I. Act, even if a blank cheque is given, the holder has authority to make or complete the instrument as a negotiable one. It means the accused has impliedly given permission to the holder of the cheque to fill up blanks in the cheque. Once all these things are established, Sec. 139 of N.I. Act states that the cheque has been issued for the discharge of debt or liability unless the contrary is proved".
Therefore, after going through the above said ruling of the Hon'ble High Court of Karnataka, it is very clear that as per Sec.20 of the N.I. Act, even if the blank cheque is given, the holder of the cheque has authority to complete the instrument as negotiable one as the accused has impliedly given permission to holder of the cheque to fill up the blanks in the cheque.
20. The main defence of the accused is that, complainant has misused the cheque and blank stamp SCCH-8 17 C.C.No.2518/2023 papers and promissory note and filed false complaint by misusing the same. If the complainant misused the signed blank cheque and other document, why he kept quiet without taking the legal action against the complainant and what prevented him to taken action against him, is not answered by the accused and it creates the suspicion on the contention of the accused. Any prudent man cannot sit like accused, if the cheques and other documents were misused by other person and it was within his knowledge.
21. When the accused has taken up a specific plea that the disputed cheque was given as security to loan of Rs.1,00,000/- in the year 2019 and it was misused. The onus to prove under Section 102 Indian Evidence Act shifts on the accused to demonstrate the same. But except denial the accused has not produced any document. When such being the case, there is no strength in the arguments canvassed by the learned counsel for the accused. This court has not persuaded to accept the contention of the accused. SCCH-8 18 C.C.No.2518/2023 Assuming for a moment, hypothetically only for the sake of appreciation of evidence, if the disputed cheque issued to the complainant as security of loan in the year 2019, after repayment of loan it was misused by the Pw1, accused has not explained what prevented him to taken back the cheque even he has repaid the loan and also call him to return the cheque and other document which was given in the year 2019 and also to take the legal action. The accused would have at-least sent a legal notice to give back the cheque. There is no suggestions to the Pw1 by accused counsel whether the accused has taken legal action. It discloses that the accused has not taken any legal action whatsoever known to law calling the complainant or his father to return the cheque which he has given as security of hand loan to the complainant. No ordinary prudent man will sleep over his rights when his cheque is not returned. Without there being any documentary or independent oral evidence, mere contention taken up in the cross-examination of PW.1 does SCCH-8 19 C.C.No.2518/2023 not avail any benefit to the accused. Hence, this contention urged by the accused is also not tenable in the eye of law.
22. Further more, the accused has not taken any action against the complainant after filing of this case. If there was really a transaction as alleged by the accused then he would have certainly taken action. In this regard it is relevant to rely on the decision reported in AIR 2023 SC 5018 in the case of Rajesh Jain V/s Ajay Singh, wherein it was held as here under :
Once the presumption under Section 139 was given effect to, the Courts ought to have proceeded on the premise that the cheque was, indeed, issued in discharge of a debt/liability. The entire focus would then necessarily have to shift on the case set up by the accused, since the activation of the presumption has the effect of shifting the evidential burden on the accused. The nature of inquiry would then be to see whether the accused has discharged his onus of rebutting the presumption. If he fails to do so, the Court can straightaway proceed to convict him, subject to satisfaction of the other ingredients of Section 138. If the Court finds that the evidential burden placed on the SCCH-8 20 C.C.No.2518/2023 accused has been discharged, the complainant would be expected to prove the said fact independently, without taking aid of the presumption. The Court would then take an overall view based on the evidence on record and decide accordingly.
The principles laid down therein aptly applicable to the case on hand. In the instant case on hand also the accused has taken a similar defence that the complainant has misused the cheque given in the transaction between him and father of complainant, but the accused failed to initiate any legal action in this regard. The accused however failed to provide any substantial evidence or to file police complaint regarding alleged misuse of cheque. In contrast, the case of the complainant remained consistent and the signature of the accused on cheque was unchallenged, allowing presumption has to legally enforceable debt to take effect. To trigger the presumption mere admission of the drawer's signature without admitting the execution of the entire contents in the cheque is sufficient. The said principles has SCCH-8 21 C.C.No.2518/2023 been laid down by the Hon'ble Apex Court in a decision reported in (2019) 4 SCC 197 in the case of Birsingh Vs. Mukhesh Kumar. When such is the case the principles therein aptly applicable to the case on hand.
23. Further on the same point of law it is relevant to rely on a decision of the Apex Court in the case of APS Forex Services Pvt. Ltd., v. Shakti International Fashion Linkers and Others reported in AIR 2020 SC 945 held regarding presumption is concerned that when the accused admits issuance of cheque, his signature on cheque and that cheque in question was issued for discharging the liability, there is always a presumption in favour of the complainant that there exists legally recoverable debt or liability.
24. In the instant case, the accused has not raised any probable defence. Hence, in such an event the accused has not rebutted the presumption as contemplated under Sec.139 of N.I.Act. The accused though disputed financial SCCH-8 22 C.C.No.2518/2023 capacity of the complainant, but the complainant had demonstrated his financial capacity. The accused also not disputed the signature in Ex.P.4. Therefore, it is clear as a cloud less sky that presumption envisaged under Sec.118 and 139 of N.I.Act has not been rebutted by the accused.
25. Further the signature on the cheque was not denied by the accused. The discussions made supra discloses that the accused failed to demonstrate that, he has given the Ex.P4 cheque for unknown purpose to the complainant. In this regard it is relevant to rely on a decision reported in Hon'ble Apex court reported in 2015(4) KCCR 2881 (SC), held in between "Vasanthakumar V/s Vijayakumari, wherein it is held that:
"Accused not disputing issuance of cheque and his signature on it. Plea that it was issued long back as security and that loan amount was repaid".
And also relied on Decision of Hon'ble Supreme Court of India reported in AIR 2019 SC 2446 (Bir Singh V/S SCCH-8 23 C.C.No.2518/2023 Mukesh Kumar) wherein the Hon'ble court held that:
"Negotiable Instrument Act(26 of 1881), S.138, S.139- Presumption as to legally enforceable debt- Rebuttal- signed blank cheque- If voluntarily presented to payee, towards payment, payee may fill up amount and other pariculars and it in itself would not invalidate cheque- Onus would still be on accused to prove that cheque was not issued for discharge of debt or liability by adducing evidence."
Another decision reported in 2021(1) DCR 625 between M/s. Kalamani Tex and another Vs P. Balasubramanian, wherein it is held that:
"Since signature on cheque was admitted and presumption raised upon accused was not sufficiently rebutted by accused, so passing acquittal is unjustified".
The aforesaid decisions are aptly applicable to the facts and circumstances of the present case.
26. The accused also failed to obtain favourable answer from the mouth of PW.1 to rebut the presumptions. Though there are some small discrepancies in the evidence SCCH-8 24 C.C.No.2518/2023 of PW.1, that itself will not falsify the case of the complainant.
27. The complainant produced the cheque marked as Ex.P4 which was issued in his favour and he is the holder in due course and the said cheque was dishonored for the reason Cheque destroyed and even after issuance of notice, the accused has not paid the cheque amount. Thereby he has committed an offence punishable under section 138 of N.I. Act. Accordingly, I answered the Point No.1 and 2 in the Affirmative.
POINT No.3:-
28. Hence, considering the facts and circumstance involved in the case, I am of the opinion that, the complainant is entitled for the compensation as per section 80 of the Negotiable Instrument Act. Accordingly, in the light of above detailed discussion, I proceed to pass the following: SCCH-8 25 C.C.No.2518/2023
ORDER Acting U/Sec.255(2) of Cr.P.C. the accused is hereby convicted for the offence punishable U/Sec.138 of N.I. Act and he is sentenced to pay fine of Rs.4,10,000/-(Rupees Four lakhs ten thousand only).
In default of payment of the fine, the accused shall undergo simple imprisonment for a period of one year.
Out of the fine amount collected from the accused, Rs.4,00,000/- shall be paid to the complainant as compensation U/s.357(1) of Cr.P.C, remaining Rs.10,000/- shall be forfeited to State towards expenses of the case.
It is made clear that in view of Sec.421(1) of Cr.P.C even if the accused undergoes the default sentence imposed above, he is not absolved of liability to the fine amount.
Bail bond and surety bond of the accused stands cancelled.
Office is directed to supply a free copy of the judgment to the accused.
(Dictated to the Stenographer directly on computer, typed by her, corrected and then pronounced by me, in the open Court on this the 9th day of October, 2025) Digitally signed by KANNIKA KANNIKA M S MS Date: 2025.10.25 12:18:18 +0530 (Kannika M.S.) XII Addl. Small Causes Judge & ACJM, Bengaluru.SCCH-8 26 C.C.No.2518/2023
ANNEXURE List of witnesses examined for complainant :-
P.W.1 : Mr. G. Srinivas List of documents marked for complainant:-
Exhibits Particulars of the Document
Ex.P1 Loan Agreement
Ex.P2 On demand promissory note
Ex.P3 Payment receipt
Ex.P4 Cheque
Ex.P4(a) Signature of Accused
Ex.P5 Bank endorsement
Ex.P6 Legal notice dated 12.12.2022
Ex.P7 & 8 Postal receipts
Ex.P9 Postal acknowledgment
Ex.P10 Postal covers
List of witnesses examined for accused: None
List of documents marked for accused: Nil
Digitally signed by
KANNIKA KANNIKA M S
MS Date: 2025.10.25
12:18:23 +0530
(Kannika M.S.)
XII Addl. Small Causes Judge
& ACJM, Bengaluru.