Bangalore District Court
Dhanush P vs Puttaswamy on 2 December, 2025
KABC020501442024
IN THE COURT OF THE XXII ADDL. JUDGE, COURT OF
SMALL CAUSES AND ADDL. CHIEF JUDICIAL
MAGISTRATE, BENGALURU CITY
(SCCH-24)
Presided Over by Smt. Roopashri, B.Com., LL.B.,
XXII ADDL., SCJ & ACJM,
MEMBER - MACT,
BENGALURU.
Dated: On this day of 2nd day of December 2025
CC NO.15210/2024
1. Sl.No. of the Case : C.C.No.15210 of 2024.
2. The date of : 26.07.2024
commission of the
offence
3. Name of the : Sri. Dhanush P,
Complainant S/o Prabhakar R,
Aged about 26 years,
R/at #130, 2nd Main,
Avalahalli New BDA Layout,
BSK 3rd Stage,
Bengaluru - 560085.
(By Sri.Shivakumar, Advocate)
4. Name of the Sri. Puttaswamy,
Accused S/o Shambulinga Gowda,
Aged Major,
R/a # 126, 2nd Main Road,
Avalahalli New BDA Layout,
SCCH-24 2 C.C.15210/2024
BSK 3rd Stage,
Bengaluru - 560085.
Also at:
Rajadhani Garments,
Mr. Puttaswamy,
#341, Avenue Road,
Medarpet,
Old Tharagupet,
Dodpete, Nagarathpete,
Bengaluru - 560 002.
(By Sri Kumar B,
Smt.Yogeshwari.K.B, Advocates)
5. The offence complained : Under Section 138 of the
of or proves Negotiable Instrument Act.
6. Plea of the accused and : Pleaded not guilty.
his examination
7. Final Order : Accused found guilty
8. Date of such order for : 02-12-2025
the following
JUDGMENT
This complaint is filed under Sec. 200 of Cr. P. C. under Sec.223 of Bharatiya Nagarik Suraksha Sanhita for the offence punishable under Section 138 of the Negotiable Instruments Act.
SCCH-24 3 C.C.15210/20242. It is the case of the complainant that:
The complainant and accused are known to each other since several years. On 12.04.2023, the accused approached the complainant for hand loan of Rs.1,30,000/- for development of his shop. The accused promised to return the amount within short time. The complainant had paid a sum of Rs.1,30,000/- to the accused by way of cash on the same day. Towards discharge of his liability, the accused has issued a cheque bearing No. 351987 dated 15.04.2024 for a sum of Rs.1,30,000/- drawn on The Grain Merchants Co-Operative Bank Ltd., Atpar Branch, Bengaluru. As per the instruction of the accused, the complainant presented the cheque through his banker, but the said cheque was returned with an endorsement "Funds Insufficient" dated 12.06.2024 Thereafter, the complainant issued two legal notice to the accused on 27.06.2024 through RPAD. But the demand notice which was sent to the house address of the accused is returned as the Addressee left and the other notice which was sent to his shop was received by the accused on 02-07-2024.
Inspite of service of notice, the accused has not paid the cheque amount to the complainant. Accordingly, SCCH-24 4 C.C.15210/2024 the accused has committed an offence punishable under Sec.138 of N.I Act, hence, the complaint.
3. After recording the sworn statement of the complainant and verifying the documents, cognizance was taken against the accused for the offence punishable under Sec. 138 of N.I. Act. The accused on receiving the summons appeared before this Court through his counsel, enlarged on bail and his plea was recorded. The accused pleaded not guilty and claims to be tried. Hence, the case was posted for arguments.
4. The complainant got examined himself as PW.1, and got marked documents as Exs.P1 to 10 and Ex.P13. During the cross-examination of DW.1 the learned counsel for the complainant has confronted the documents and got it marked as Ex.P11 and Ex.P12. Then, the case was posted for recording the statement of accused under Sec.313 Cr.P.C. In the statement U/s 313 Cr.P.C., the accused has denied all the incriminating evidence appearing against him and claimed to be tried. The accused got examined himself as DW.1 and got marked documents as Exs.D1 and 2. Hence, the case was posted for arguments.
SCCH-24 5 C.C.15210/20245. Heard the arguments and perused the records.
6. The following points arise for my consideration:
1. Whether the complainant proves that accused has committed offence punishable under Sec.138 of N.I. Act?
2. What order?
7. My findings on the above points are as under
Point No.1: In the Affirmative.
Point No.2: As per final order for the following:
-: R E A S O N S :-
8. POINT NO.1:- It is the definite case of the complainant that, towards the discharge of legally recoverable debt, the accused has issued disputed cheque in favour of the complainant and when the cheque was presented, same was dishonoued for the reason "Funds Insufficient". Though the said fact was brought to the notice of the accused by issuing legal notice, but accused has failed to repay the cheque amount.
9. In order to substantiate the contention, the complainant got examined himself as Pw1 and got SCCH-24 6 C.C.15210/2024 marked in all 13 documents as ExP1 to Ex.P13. If the documents produced by the complainant are perused, Ex.P1 is the cheque which bears the signature alleged to be of accused. The accused nowhere has disputed the cheque which relates to his account. He even has not disputed his signature in the Ex.P1. It is deposed by Pw1 that cheque in question was issued by the accused for discharge of his legal liability. The cheque in question was presented by the complainant through his banker which was returned with memo as per ExP2 stating 'Funds Insufficient". Hence, he got issued legal notice to the accused through RPAD, which is produced at Ex.P.3. The postal receipts are marked at Ex.P.4 and
5. The returned postal cover is at Ex.P6. Copy of the legal notice is at Ex.P7. The postal acknowledgment is marked as Ex.P8. Whatsapp chat is marked at Ex.P9. Certificate U/Sec. 65B of Evidence Act is at Ex.P10. The Signature of accused is at Ex.P11, FIR No.125/2024 is marked as Ex.P12 and Statement of account is marked as Ex.P13.
10. The accused by leading his evidence while admitting that complainant is known to him since 5-6 years as they are residing in the same locality contended that in order to meet his business expenses, SCCH-24 7 C.C.15210/2024 he used to borrow money from the complainant every now and then and used to repay the same with interest at 3%. During the year 2023, he had borrowed sum of Rs.1,30,000/- by way of cash, at that time the complainant had collected blank signed cheque as security. Out of Rs.1,30,000/-, he had repaid sum of Rs.50,000/- each through online dated 26-07-2023 and 29-07-2023 and balance amount of Rs.30,000/- was repaid by cash on 01-08-2023 and paid sum of Rs.15,600/- towards interest at the rate of 3%. After repayment of said amount when the accused demanded the complainant to return the blank signed cheque given as security, the complainant has post phoned the matter on one pretext or the other and threatened the accused that he will present the cheque and file case against him. In that regard, the accused had gone to lodge the complaint against the complainant before Byatarayanapura Police Station, but they have advised the accused to resolve the dispute in the court of law. It is the further case of the accused that unless and until the earlier loan amount was repaid, the complainant was not advancing further loan to the accused The complainant has lodged false complaint against him. Hence submitted to acquit him from the false charges leveled against him.
SCCH-24 8 C.C.15210/202411. In order to substantiate the defence, the accused got examined him self as DW.1 and got marked documents as Ex.D1 and Ex.D2.
12. If the defence taken by the accused is perused, the accused has admitted his signature in the Ex.P1 and also admitted that Ex.P1 relates to his account. Once the cheque relates to the account of the accused and he accepts and admits the signatures on the said cheque, then initial presumption as contemplated under Section 139 of the Negotiable Instruments Act has to be raised by the court in favour of the complainant. The presumption referred to in Section 139 of the N.I. Act is a mandatory presumption and not a general presumption, but the accused is entitled to rebut the said presumption. What is required to be established by the accused in order to rebut the presumption is different from each case under given circumstances. But the fact remains that a mere plausible explanation is not expected from the accused and it must be more than a plausible explanation by way of rebuttal evidence. In other words, the defence raised by way of rebuttal evidence must be probable and capable of being accepted by the SCCH-24 9 C.C.15210/2024 court. It was so held in catena of decisions of Hon'ble High Court and Hon'ble Supreme Court.
13. If the evidence placed on record is perused, as observed supra, it is not in dispute that accused is known to the complainant since 5-6 years and both of them are residing in New B.D.A layout, Avallahalli. The learned counsel for accused has posed question to the PW.1 regarding his avocation. The learned counsel asked question to the PW1 that the complainant has not stated in his complaint the place at which Rs.1,30,000/- was given. But if the complaint is perused wherein complainant has clearly stated that sum of Rs.1,30,000/- was given in his house. Even in the evidence also he has stated the same thing. It was deposed by PW.1 that since accused is residing near by his house and known to him since several years and earlier also accused used to borrow money from the complainant and used to repay it, he thought it not necessary to get the loan agreement executed from the accused.
14. If the evidence of the Dw.1 is perused, in specific terms the DW.1/accused has admitted the money transaction held between him and the SCCH-24 10 C.C.15210/2024 complainant and deposed that he used to borrow money from the complainant and used to repay the same. According to the accused even sum of Rs.1,30,000/- received by him during the year 2023 was repaid by him.
15. The learned counsel for accused has posed question to the PW.1 that the complainant has not whispered anything about the previous money transaction held between him and the accused either in the legal notice or in the complaint or in the evidence in chief. But when the accused himself has admitted the previous money transaction held between him and the complainant and when the present case is in relation to the dishonour of cheque issued for payment of Rs.1,30,000/- received by the accused in cash in the year 2023, under such circumstances it is not at all warranted to mention the previous transaction held between the parties either in the notice or in the complaint or in the evidence in chief. Further when the previous transaction was closed the question of narrating the said fact in the complaint or in the notice does not arise.
SCCH-24 11 C.C.15210/202416. The accused while admitting sum of Rs.1,30,000/- received by him from the complainant during the year 2023 by way of cash has taken the defence that he had repaid the said amount, hence, there is no legally enforceable debt and that he had given the cheque as security during the year 2023 and even after repayment of the amount, the complainant has not returned the cheque. In order to evidence the said fact the accused has relied upon the bank statement.
17. It is categorically deposed by PW.1 that towards the present loan transaction the accused has not paid any amount either prior to the filing of the complaint or subsequent to the filing of the complaint. If the Bank Statement produced by the complainant at Ex.P13 and the bank statement of the accused at Ex.D1 is perused, it can be gathered that on 18-03- 2023 and 22-03-2023 the complainant had transferred sum of Rs.50,000/- each to the accused. The entries in the Ex.D1 and Ex.P1 further discloses that the said sum was repaid by accused on 20-07-2023 and 29-07- 2023 through account transfer.
SCCH-24 12 C.C.15210/202418. Though the Dw.1 in his evidence in chief has deposed that apart from Rs.1,00,000/- repaid through account transfer, he had even paid sum of Rs.30,000/- on 01-08-2023 by way of cash and Rs.15,600/- towards interest at the rate of 3%, but no evidence has been placed to prove the payment of sum of Rs.45,600/- in all by way of cash.
19. From the aforesaid evidence it can be said that the payment of Rs.50,000/- each made by the accused on 26-07-2023 and 29-07-2023 was towards sum of Rs.1,00,000/- received by him from the complainant through account transfer but not towards sum of Rs.1,30,000/- received by him by way of cash on 12-04-2023. When accused has admitted that during the year 2023 he had received sum of Rs.1,30,000/- from the complainant by way of cash, hence he has to prove the repayment of the said amount. The payment of Rs.50,000/- each made by him in the month of July -2023 was towards Rs.1,00,000/- received by him by way of account transfer but not towards Rs.1,30,000/- received by him by way of cash.
SCCH-24 13 C.C.15210/202420. According to the accused he had issued the blank signed cheque at the time of borrowing money in the year 2023 but not on 15-04-2024. The accused has admitted his signature in the Ex.P1 and also admits that Ex.P1 relates to his account. Even if it is taken for a while for the sake of discussion that accused has given blank signed cheque in the year 2023 as security while borrowing money of Rs.1,30,000/- it does not take away the case of the complainant.
21. Now at this juncture it would be relevant to refer here the judgment rendered in Crl. Appeal No. 230-231/ 2019 decided on 06-02-2019 between Bir Singh Vs. Mukkesh Kumar wherein it has been held that " Even a blank cheque leaf, voluntarily signed and handed over the accused, towards some payment would attract the Section unless contrary is proved".
22. Further Sec. 20, 87 , 139 of the NI Act makes it clear that a person who signs a cheque and makes it over to the payee remains liable unless the adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the SCCH-24 14 C.C.15210/2024 cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be attracted.
23. So for as the defence taken by the accused regarding issuance of cheque as security is concerned, even if it is taken for a while for the sake of discussion that the accused has issued the cheque as security but when it is proved that the accused has not repaid sum of Rs.1,30,000/- under such circumstances, even cheque issued as security should also be considered as the cheque issued for discharge of legally enforceable debt. Now at this juncture it would be relevant to refer here the judgment reported in Crl.Appeal No.1269- 1270/2021 between Sripati Singh (Since deceased) Through his son Gaurav Singh Vs., The State of Jharkhand & Anr., wherein the Hon'ble Supreme Court has observed that "a cheque issued as a security pursuant to a financial transaction cannot be considered as a worthless piece of paper under every circumstance, 'Security' in its true sense is the state of being safe and the security given for a loan is something given as a pledge of payment. It is given, deposited or pledged to make certain the fulfillment of an obligation to which the parties to the transaction are SCCH-24 15 C.C.15210/2024 bound. If in a transaction, a loan is advanced and the borrower agrees to repay the amount in a specified time frame and issues a cheque as security to secure such repayment. If the loan amount not repaid in any other form before the due date or if there is no other understanding or agreement between the parties to defer the payment of amount, the cheque which is issued as security would mature for presentation and the drawee of the cheque would be entitled to present the same. On such presentation, if contemplated under Section 138 and the other provisions of N.I.Act would flow".
"When a cheque is issued and is treated as 'security' towards repayment of an amount with a time period being stipulated for repayment, all that it ensures is that such cheque which is issued as 'security' cannot be presented prior to the loan or the installment maturing for repayment towards which such cheque is issued as security. Further, the borrower would have the option of repaying the loan amount or such financial liability in any other form and in that manner if the amount of loan due and payable has been discharged within the agreed period, the cheque issued as security cannot thereafter be presented. Therefore, the prior discharge of the loan or SCCH-24 16 C.C.15210/2024 there being an altered situation due to which there would be understanding between the parties is a sine qua non to not present the cheque which was issued as security. These are only the defences that would be available to the drawer of the cheque in a proceedings initiated under Section 138 of the N.I.Act. Therefore, there cannot be a hard and fast rule that a cheque which is issued as security can never be presented by the drawee of the cheque".
24. The learned counsel for accused by relying upon the Ex.D1 wherein there is an entry regarding sum of Rs.50,000/- each transferred on two different dates has argued that even though the accused had made part payment but the complainant has not disclosed the same either in the notice or in the complaint and he has not endorsed the part payment made in the cheque hence the complaint is liable to be dismissed on that score itself. The learned counsel in support of the argument has relied upon the judgment rendered in Crl.Appeal No. 1497/2022 between Dashrathbahi Trikambhai Patel Vs. Hitesh Mahendrabhai Patel & Anr., by the Hon'ble supreme court where in it was observed that "there is statutory presumption that the sum drawn in the cheque is a SCCH-24 17 C.C.15210/2024 debt or liability that is owned by the drawer of the cheque to the drawee. The part payment made by the first respondent ought to have been reflected in the statutory notice issued by the complainant. The sum in the cheque is higher than the amount that was due to the complainant. Thus the statutory notice issued under section 138 is not valid. It is an omnibus notice since it did not recognize the part payment that was made. It was further observed that the term debt or other liability used in section 138 of the Act means legally enforceable debt or other liability. Thus the demand made in the statutory notice must be for a sum that is legally enforceable. If the debtor has paid part of the debt, a statutory notice seeking the payment of entire sum the cheque without any endorsement under section 56 of the part payment made would not be legally sustainable and since accused has paid off a part of the debt, the complainant cannot initiate action if the cheque which represented the principal amount without deducing or endorsing a part payment has been dishonored.
25. In the present case, the payment made by the accused to the tune of Rs.1,00,000/- was towards the previous loan transaction of Rs.1,00,000/- received by SCCH-24 18 C.C.15210/2024 the accused through account transfer. But the present loan transaction is by way of cash and that amount was not repaid by the accused. Hence Sec. 56 of the NI Act cannot be made applicable to the case in hand to say that the complainant ought to have endorsed in the cheque regarding part payment made by the accused or that the complainant ought to have taken fresh cheque from the accused for the balance payment.
26. So for as the judgment relied by the learned counsel for accused reported in AIR 2019 Supreme Court 1983 between Basalingappa Vs. Mudibasappa is concerned, in the said case, the accused has questioned the financial capacity of the complainant to lend the cheque amount to the accused. In the said case, the complainant has failed to prove his financial capacity. Under such circumstances, the accused was acquitted interalia that the complainant has failed to prove his financial capacity.
27. But coming to the case in hand, the accused nowhere has disputed the financial capacity of the complainant, instead the accused himself has admitted the financial competency of the complainant to lend Rs.1,30,000 by stating that he used to borrow money from the complainant every now and then for the SCCH-24 19 C.C.15210/2024 improvement of his business. Further Ex.D1 discloses the previous loan transaction of accused with the complainant. Hence, the observation made in the aforesaid judgment has no application to the case in hand.
28. The learned counsel for complainant has produced the FIR copy at Ex.P12. The said document discloses that some third party has lodged complaint against the accused before Byatarayanapura police station alleging commission of offence u/Sec. 420, 406, 120 B r/w 34 of IPC. The accused in his statement recorded under Sec. 313 of Cr.PC has stated that at the time when notice was issued to him he was in the judicial custody. Further the accused in his evidence has admitted number of cases registered against him u/Sec. 138 of NI act by the members of the chit transaction which he was running. On appreciation of the evidence, both oral and documentary it can be said that accused has failed to probablise the defence beyond preponderance of probabilities and thereby failed to rebut the presumption raised infavour of the complainant.
SCCH-24 20 C.C.15210/202429. In the light of the discussion herein above, this court is of the considered opinion that complainant has proved that accused has committed the offence punishable under Section 138 of Negotiable Instruments Act. Accordingly, I answered Point No.1 in the Affirmative.
30. POINT No.2 :- The Negotiable Instruments Act is a Special Enactment and the provisions of the Act prevail over the general provisions contained in Code of Criminal Procedure. Therefore, keeping the relevant provisions of the Act in mind the sentence is to be passed. In the light of the reasons on the Point No.1, I proceed to pass the following;
ORDER Acting under Sec. 278(2) of BNSS the accused is found guilty of the offence punishable under section 138 read with section 142 of NI Act.
Consequently, accused is sentenced to pay fine of Rs.1,40,000/- (Rupees One Lakh Forty Thousand only), out of which Rs.1,35,000/- shall be paid as SCCH-24 21 C.C.15210/2024 compensation to the complainant under Sec.396 of BNSS and Rs.5,000/- shall be payable to the State.
In the event of default in payment within a period of one month, the accused shall be convicted to simple imprisonment for a period of 4 months.
It is made clear that in view of Sec.430 of BNSS, even if the accused under goes the default sentence imposed above, he is not absolved of liability to pay the fine amount.
The bail bond of accused and that of surety stands canceled.
Office to furnish the copy of this judgment free of cost to the accused.
(Dictated to the stenographer directly on computer, corrected and then pronounced by me in open court, on this the 2 nd day of December 2025.) (ROOPASHRI) XXII Addl.SCJ & ACJM Bengaluru.
SCCH-24 22 C.C.15210/2024:ANNEXTURE:
LIST OF WITNESSES EXAMINED ON BEHALF THE COMPLAINANT P.W.1 : Sri.Dhanush P LIST OF DOCUMENTS MARKED ON BEHALF COMPLAINANT:
Ex.P.1 : Original Cheque
Ex.P.1(a) : Signature of the accused.
Ex.P.2 : Endorsement.
Ex.P.3 : Copy of legal notice.
Ex.P.4 & 5 : Postal Receipts s
Ex.P.6 : Returned postal cover
Ex.P.7 : Copy of notice
Ex.P8 : Postal acknowledgment
Ex.P9 & 10 : Whatsapp chats along with certificate
U/Sec. 65B of Indian Evidence Act
Ex.P11 : Signature of accused
Ex.P12 : FIR No. 125/2024
Ex.P13 : Statement of Account
LIST OF WITNESSES EXAMINED BY THE ACCUSED DW.1 : - Puttaswamy Gowda LIST OF DOCUMENTS MARKED ON BEHALF OF ACCUSED:
Ex.D1 : o Bank statement
Ex.D2 : o Certificate U/Sec. 65B of Evidence
Act
XXII Addl. SCJ & ACJM
Bengaluru.
Digitally
signed by
ROOPASHRI
ROOPASHRI Date:
2025.12.02
16:04:11
+0530