Bangalore District Court
Sashi Kumar vs Prashanth B on 19 April, 2025
KABC0C0316102022
IN THE COURT OF XXXIV ADDL. CHIEF JUDICIAL MAGISTRATE,
MAYO HALL UNIT, BENGALURU (ACJM-34)
PRESENT: Smt.PARVEEN A BANKAPUR,B.Com.LLB.
XXXIV ADDL. CHIEF JUDICIAL MAGISTRATE
Dated : This the 19th day of April, 2025.
C.C.No.59268/2022
COMPLAINANT : Mr.Sashi Kumar
S/o. Subbanna
Aged about 38 years
R/at No. 30/1, Sai Krupa Nilya,
Lakshmisagar Layout, Whitefield
Road, Mahadevapura,
Bengaluru East,
Bengaluru - 560 048.
(By Mr.R. Pradeep - Advocate)
V/s
ACCUSED : Mr. Prashanth B
Proprietor of SSC Fabricators,
No.B-110/A, 7th Cross, ITI Industrial
Estate, Mahadevapura Post,
Bengaluru -48.
(By Mr. Sandesh T.B. - Advocate)
1 Date of Commencement 16.09.2022
of offence
2 Date of report of offence 28.10.2022
3 Presence of accused
3a. Before the Court 07.03.2023
3b. Released on bail 07.03.2023
4 Name of the Complainant Mr. Shashi Kumar
5 Date of recording of 20.12.2022
evidence
6 Date of closure of evidence 20.09.2024
7 Offences alleged U/s 138 of the Negotiable
Instruments Act
8 Opinion of Judge Accused is not found guilty
2 C.C.No.59268/2022
JUDGEMENT
The Private Complaint filed by the Complainant under Section 200 of Cr.P.C. against the accused alleging that he has committed the offence punishable under Section 138 of Negotiable Instruments Act.
2. The brief facts of the complaint are as follows:
The complainant submits that, the Accused is known to him since several years. The Accused approached him on 1.6.2016 for a handloan of Rs.3 lakhs for the purpose of purchasing the site for payment of arrears of Accused personal loan,. Accordingly the Complainant had paid Rs.3 lakhs as loan by entering into Handloan Agreement. After receipt of the said amount, the Accused had requested another sum of Rs.2 lakhs for payment of arrears of Accused personal loan and the Complainant without executing any agreement, had paid Rs.2 lakhs by way of cash to the Accused. It is further submitted that after obtaining Rs.5 lakhs, the Accused had agreed to pay total amount within one year but, the Accused has not repaid the said amount within agreed period.
It is further submitted that upon is repeated requests and demands finally the Accused issued a Cheque bearing 3 C.C.No.59268/2022 No.557010 dtd.16.9.2022 for Rs.5,00,000/- drawn on Canara Bank, Mahadevapura branch, Bengaluru and requested to grant further time of one year for payment of amount, but the Accused has not not repaid the said amount.
It is further submitted that finally on several demands and requested the Accused to repay the said amount, the Accused instructed to present the said Cheque.
It is further submitted that as per the instruction of the Accused, he presented the Cheque for encashment through his banker i.e., HDFC Bank, Mahadevapura branch, Bengaluru on 16.9.2022 and the said Cheque was returned dishonoured with reason "Cheque destroyed" on 17.9.2022. Thereafter, the Complainant got issued demand notice through Courier on 30.9.2022, through his counsel to the Accused. The said notice was delivered to the Accused on 30.9.2022. Despite receipt of the legal notice the Accused has neither paid the Cheque amount nor replied the notice. Hence, the Complainant has filed the present complaint against the Accused for the offence punishable u/Sec.138 of N.I. Act.
3. Based on the complaint, the sworn statement affidavit, and documents etc., took cognizance of an offence punishable 4 C.C.No.59268/2022 Under Section 138 of N.I. Act by following the guidelines of Apex Court issued in Indian Bank Association case and ordered to be registered a criminal case against the accused for the offence punishable Under Section 138 of N.I. Act.
4. After issuance of summons, accused appeared before the court and enlarged himself on bail. Plea was recorded, read over and explained to the accused, who pleads not guilty and claims to be tried. Hence, the case is posted for complainant's evidence.
5. The Complainant got examined himself as PW-1 and got marked documents Ex.P.1 to Ex.P.6.
6. Accused was examined U/S 313 of Cr.P.C.
Incriminating evidence appearing in the complainant's evidence was read over and explained to the accused who denies the same. The Accused examined himself as DW1 and no documents were marked from his end and closed his side.
7. Heard both counsels at length in great detail. The learned counsel for Accused has placed the following citations;
1. 2008 AIR SCW 738
2. ILR 2008 KAR 3635 5 C.C.No.59268/2022
3. 2019 (5) SCC 418
4. 2014 (2) SCC 236
8. Upon hearing the arguments and on perusal of the materials placed on record, the following points arise for my consideration.
1) Whether complainant proves beyond all reasonable doubts that accused in discharge of legally recoverable debt, has issued a Cheque No.557010 dtd.16.9.2022 for Rs.5,00,000/-
drawn on Canara Bank, Mahaddevapura branch, Bengaluru in favour of the complainant which came to be dishonoured with an endorsement "Cheque destroyed" and in spite of receipt of notice accused has not paid the Cheque amount and thereby committed an offence under Section 138 of N.I.Act?
2) What Order?
9. My findings on the above points is:
Point No.1: In the Negative Point No.2: As per final order for the following:
REASONS Point No.1:-
10. Existence of legally recoverable debt is a sine qua non for prosecuting the case under Section 138 of Negotiable Instruments Act. For convenient purpose the essential ingredients to constitute offence under section 138 of N.I.Act is summarized as below:
6 C.C.No.59268/2022
(i) That there must be a legally enforceable debt.
(ii) That the cheque was drawn from the account of bank for discharge in whole or in part of any debt or other liability which presupposes the legally enforceable debt.
(iii)That the cheque so issued had been returned due to "insufficient funds".
11. It is the core contention of the complainant that, the Accused is known to him since several years. The Accused approached him on 1.6.2016 for a handloan of Rs.3 lakhs for the purpose of purchasing the site for payment of arrears of Accused personal loan,. Accordingly the Complainant had paid Rs.3 lakhs as loan by entering into Handloan Agreement. After receipt of the said amount, the Accused had requested another sum of Rs.2 lakhs for payment of arrears of Accused personal loan and the Complainant without executing any agreement, had paid Rs.2 lakhs by way of cash to the Accused. It is further submitted that after obtaining Rs.5 lakhs, the Accused had agreed to pay total amount within one year but, the Accused has not repaid the said amount within agreed period.
12. It is further submitted that upon is repeated requests and demands finally the Accused issued a Cheque bearing No.557010 dtd.16.9.2022 for Rs.5,00,000/- drawn on Canara 7 C.C.No.59268/2022 Bank, Mahadevapura branch, Bengaluru and requested to grant further time of one year for payment of amount, but the Accused has not not repaid the said amount within one year and on the instruction of the Accused, the Complainant e presented the Cheque for encashment through his banker i.e., HDFC Bank, Mahadevapura branch, Bengaluru on 16.9.2022 and the said Cheque was returned dishonoured with reason "Cheque destroyed" on 17.9.2022. Thereafter, the Complainant got issued demand notice through Courier on 30.9.2022, through his counsel to the Accused. The said notice was delivered to the Accused on 30.9.2022. Despite receipt of the legal notice the Accused has neither paid the Cheque amount nor replied the notice. Hence, the Complainant has filed the present complaint against the Accused for the offence punishable u/Sec.138 of N.I. Act.
13. In order to bring home the guilt of the accused, complainant has examined himself as PW1 and reiterated the contents of complaint in his examination-in-chief. He has also placed the original Cheque bearing No.557010 dtd.16.9.2022 at Ex.P.1, bank endorsement at Ex.P2, Ex.P3 is the Handloan agreement, Ex.P4 is the office copy of legal notice issued by the 8 C.C.No.59268/2022 Complainant to the Accused, Ex.P5 is the courier receipt and Ex.P6 is the courier track.
14. The documents produced by the complainant of course established that complainant meets out the procedural requirements of Section 138 of Negotiable Instrument Act, but it is to be considered whether all these documents establish the offence committed by the accused.
15. The Negotiable Instruments Act raises two presumptions. One contained in Section 118 and the other in Sec. 139 thereof. For the sake of convenience Sec 118(1) of the N.I. Act is extracted here below:
118. Presumptions as to negotiable Instruments--
Until the contrary is proved, the following presumptions shall be made ;--
(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, indorsed, negotiated or transferred for consideration.
1. To (g) . . . . . . . . . . . .
Provided that where the instrument has been obtained from its lawful owner, or from an person in 9 C.C.No.59268/2022 lawful custody thereof, by means of an offence of fraud, or has been obtained from the maker or acceptor thereof by means of an offence of fraud, or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him".
16. Further Section 139 of the Negotiable Instruments Act reads as under:
"139, Presumption in favour of holder. It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in section 138, for the discharge, in whole or in part, of any debt or other liability."
Scope and ambit and function of the presumption U/s 118(a) and Sec 139 of NI Act came to be considered by the Hon'ble Apex Court of Indian in Krishna Janardhan Bhat Vs Dattatraya G.Hegde (2008 AIAR (Criminal 151) The Supreme Court has laid down the law in the following phraseology.
"D Negotiable Instruments Act 1881, Secs 139, 138--Presumption under-same arises in regard to second aspect of the matter provided under Sec 138-- Existence of legally enforceable debt is not a matter of presumption under Sec 139- It merely raises presumption in favour of a holder of the cheque that the same has been issued for discharge of any debt or other liability - Merely an application of presumption 10 C.C.No.59268/2022 contemplated under Section 139 of N.I.Act should not lead to injustice or mistaken conviction."
17. Further, said decision was followed by Hon'ble High Court of Karnataka in Kempanarasimhaiah Vs P.Rangaraju & Others (2008 (5) KCCR 3371). Relevant paragraph of the said judgment reads as under: -
"12. As to the provisions of Sections 138 of N.I.Act, the following principles emerge from the above observations of Hon'ble Supreme Court at para Nos 21, 23, 25, 26 and 34 of its Judgment in the above said case of Krishna Janardhan Bhat Vs Dattatraya G.Hegde, AIR 2008 SC 1325.
(i) Section 139 of the Act merely raises a presumption that the cheque was issued towards discharge in whole or in part in any debt or other liability, which presupposed legally enforceable debt. Existence of legally recoverable debt is not a matter of presumption under Section 139 of the Act. It merely raises a presumption in favour of a holder of the cheque that the same has been issued for discharge of any debt or other liability." (para 21)
(ii) The question as to whether the presumption stood rebutted or not, must be determined keeping in view the other evidences on record. Where the chances of false implication cannot be ruled out, the background fact and the conduct of the parties together with their legal requirements are required to be taken into consideration. (para 26)
(iii) An accused, for discharging the burden of proof placed upon him under a statute, need not examine himself.11 C.C.No.59268/2022
He may discharge his burden on the basis of the materials already brought on records (para 23)
(iv) Standard of proof on the part of an accused and that of the prosecution in a criminal case is different. Further more where as prosecution must prove the guilt of an accused beyond all reasonable doubt, the standard of proof so as to prove a defence on the part of an accused is "preponderance of probabilities'" ( para 23 & 25)
(v) Inference of preponderance of probabilities can be drawn not only from the materials brought on records by the parties but also by reference to the circumstances upon which he relies ( para 25)
(vi) Other important principles of legal jurisprudence, namely presumption of innocence as human rights and the doctrine of reverse burden introduced by Section 139 should be deliberately balanced (para 34)
18. Thus from the observations extracted above, it is clear that presumption Under Section 139 of the N.I,.Act is only to the extent that the cheque was drawn for discharge in full or in part of any debt or other liability and the said presumption do not relate to the existence of legally enforceable debt or liability. Therefore, before drawing the presumption under section 139 of the N.I.Act, it is the duty of the Court to see whether or not the complainant has discharged his initial burden as to existence of legally enforceable debt. No doubt, as per Section 118(a) of the Act, there is a rebuttable presumption that every negotiable instrument, is accepted, endorsed, 12 C.C.No.59268/2022 negotiated or transferred was accepted, endorsed, negotiated or transferred for consideration."
19. Factual matrix of the case is required to be tested on the anvil of principles emerging from the above-referred decisions.
20. The defence taken by the Accused is that, he has received Rs.3 lakhs amount from the Complainant on 1.6.2015 and entered into handloan agreement on the same date and issued 4 signed blank cheques for the purpose of security and also issued another document i.e., sale deed for the purpose of security and he had returned Rs.1 lakh amount on 1.6.2016, Rs.1 lakh on 20.6.2016 and Rs.1 lakh on 20.7.2016. Hence the Accused has paid entire loan amount to the Complainant. It is further submits that after returning of entire amount, the Complainant has not returned 4 security cheques, only returned original sale deed to the Complainant and asked another Rs.2 lakhs additional amount from the Accused and misused the cheques and filed this false complaint against him.
21. In order to substantiate his claim, the Complainant examined himself as PW1 and he deposed that, he know the 13 C.C.No.59268/2022 Accused since from several years and on 1.6.2016 Accused approached requesting handloan of Rs.3 lakhs for the purpose of purchasing a site for payment of arrears of his personal loan. It is further deposed that as per the request the Complainant paid Rs.3 lakhs and Accused executed handloan agreement as per Ex.P3. It is further deposed that, the Accused again requested another Rs.2 lakhs on that time, the Complainant paid Rs.2 lakhs by way of cash without executing any document. It is further deposed that, after receipt of Rs.5 lakhs loan amount, the Accused agreed to repay the entire loan amount within one year. But, he failed to repay the loan amount within one year. It is further deposed that, after repeated requests and demands, in the month of November 2018 the Accused issued Ex.P1 cheque for Rs.5 lakhs in favour of Complainant and requested to grant further one year for the payment of amount and even after lapse of one year, he again prolonging the payment of loan amount until June 2021. Thereafter after several requests Accused instructed to present the cheque, as per the instruction, Complainant presented the Ex.P1 before the bank which was dishonoured with reason 'cheque destroyed' as per Ex.P2. It is further deposed that, the 14 C.C.No.59268/2022 same fact intimated to the Accused, but the Accused has not bothered. It is further deposed that, the Accused has issued the said cheque with malafide intention just to avoid his liability.
22. Considering the oral and documentary evidence placed by the Complainant, prima facie presumed that, Ex.P1 cheque was issued by the Accused towards legally enforceable debt and liability. To rebut the presumption the learned counsel for Accused cross-examined the PW1 in full length. In the cross-examination of PW1, he stated that, first time he has paid Rs.3 lakhs amount to the Accused in the month of July 2015. He further stated ton on 1.6.2019 he paid Rs.3 lakhs amount to the Accused. He further stated that later he has paid Rs.2 lakhs amount to the Accused in the year 2016. He further stated that on 1.6.2015 loan agreement was executed by the Accused and he agreed the conditions mentioned in the Ex.P3 loan agreement. He further admits in the cross-examination that, as per the condition in the loan agreement after returning of Rs.3 lakhs amount, the original sale deed which hand over by the Accused will be returned to the Accused. But he denied that after returning of Rs.3 lakhs loan amount to him, he had 15 C.C.No.59268/2022 returned original sale deed to the Accused. In the cross- examination he stated that he does not know that at the time of issuance of notice, where the Accused was residing. He further stated that, Accused issued Ex.P1 cheque in the year 2018 to him at Singayanapalya. He further stated aht as per Ex.P2 the cheque was dishonoured with reason reason 'cheque destroyed'. He further stated that he was enquired to the bank about destroyed cheque and bankers told him that in the year 2021 the Accused was cancelled the cheque. He further admits that in Ex.P4 date of issuance of notice was not mentioned. In the cross-examination he further admits that on Ex.P1 apart from signature, other handwriting was belongs to him.
23. To rebut the presumption, the Accused examined himself as DW1. He deposed that, he know the Complainant from past several years. He further deposed that he received sum of Rs.3 lakhs from the Complainant by way of cash on 1.6.2015 and at that time, he executed handloan agreement and also issued 4 signed blank cheques for the purpose of security and also issued one original sale deed to the Complainant towards the security purpose. It is further deposed hat he returned Rs.1 lakh amount on 1.6.2016, Rs.1 16 C.C.No.59268/2022 lakh on 20.6.2016 and another balance amount of Rs.1 lakh was returned on 20.7.2016. Therefore, he returned entire loan amount to the Accused and take back his original sale deed from the Complainant. He further deposed that when he requested to return back his 4 cheques, which was issued by him for the security purpose, but the Complainant was refused his request and demanded another Rs.2 lakhs amount from the Accused. He further deposed that the Accused requested the Complainant several times for returning of blank cheques. But when the Complainant asked and demanding another Rs.2 lakhs from the Accused, the Accused will stop to asking for return of said cheques. It is further deposed that, he has not issued Ex.P1 cheque towards discharge of any liability. It is further deposed that the Complainant misused his cheque and filed false complaint against him.
24. In the cross-examination he stated that the Accused was known to him from his relative. He admits that in the year 2015 he received amount from the Complainant for purchasing of site. He further stated that, in the loan agreement, cheque numbers were not mentioned. He further stated that, for returning of Rs.3 lakhs amount to the Complainant, he was 17 C.C.No.59268/2022 not produced any documents. He further stated that, he was not taken any legal action against the Complainant for non- returning of cheque and original loan agreement. In the cross- examination he further stated that, from receiving the amount from his friend Mr. Girish, he returned the loan amount to the Complainant. He admits that on 3.7.2021 he sent message to the Complainant. He further stated that, without his consent, bankers were destroyed his cheque. He further admits that till today his bank account was continued and it is current account. He further stated that, after destroying of six month the know the fact. He further stated that in the year 2018 Ex.P1 cheque was destroyed. He further stated that, he was not intimated the same to the Complainant. He further stated that, in Ex.P1 it is not mentioned that, cheque was issued for the purpose of security
25. Considering the oral and documentary evidence placed by the both sides, it is clear that the Accused was received Rs.3 lakhs loan amount from the Complainant in th year 2015 for the purchase of site. It is further clear that Ex.P1 cheque was belongs to the Accused and also signature appears on the cheque was belongs to the Accused. It is further clear 18 C.C.No.59268/2022 that Ex.P3 handloan agreement was executed by the Accused in favour of Complainant.
26. The defence taken by the Accused is that he was returned Rs.3 lakhs loan amount to the Complainant but, the Complainant has misused the cheques which issued by him for the purpose of security. At the time of argument, the learned counsel for Accused taken another defence that the cheque amount was time barred debt and another defence is that, it is destroyed cheque and in the notice, the date was not mentioned and also in the complaint it is not mentioned that about issuance of cheque as well as date of issuance of cheque.
27. On perusal of Ex.P3 it was executed on 1.6.2015. in Ex.P3 it was mentioned that for the purpose of clearing the debts which taken for purpose of purchasing the site. It is further mentioned that, Accused agreed to return the said amount without interest on 1.6.2016 and also it is mentioned for the security purpose original sale deed was hand over to the Complainant as a security purpose to the Complainant and also Complainant agreed that, immediately after returning of loan amount, he will return the original sale deed to the Accused. In Ex.P3 there is no whisper about issuance of security cheque as 19 C.C.No.59268/2022 the Accused taken his defence that on the same date he was issued 4 blank signed cheques to the Complainant as a security purpose. Further, in the cross-examination it is admitted by the PW1 that, he was returned original sale deed to the Complainant for the purpose that, the Accused stated that him that for selling the site he would take legal opinion from the legal expert. Therefore, he returned original sale deed to the Accused.
28. Another defence is that the cheque amount was time barred debt. As admitted by both parties that on 1.6.2015 the loan amount was received by the Accused from the Complainant and cheque date was 16.9.2022. As per the contention of Complainant, cheque was issued in the month of November 2018 by mentioning the date as 16.9.2022. As per the evidence of Accused, he issued 4 blank cheques to the Complainant on the date of receipt of Rs.3 lakhs loan amount i.e., on 1.6.2015. Further, as per the statement of Accused, the cheque was destroyed in the year 2018 and he was not consented to destroy the cheque to the bank. In the cross- examination the PW1 clearly admits that, in Ex.P1 cheque except signature of the Accused, entire handwriting belongs to 20 C.C.No.59268/2022 him. Therefore, the date was not mentioned at the time issuance of cheque from the Accused. As admitted by the Complainant himself in the cross-examination that, cheque date was mentioned by him only. The loan amount was received by the Accused on 1.6.2015 and after lapse of more than six years the cheque was presented for the encashment. After 1.6.2018 there is no any written extension of time for presenting the cheque or issuance of cheque or return of loan amount document was not executed by either the parties. As above stated, the main and strong defence of the Accused is that, the claim is time barred debt, which is not enforceable debt. In this regard, it is useful to refer the judgement of Hon'ble Supreme Court of India in Sasseriyil Joseph V/s. Devassia dtd.10.9.2001 wherein the Hon'ble Supreme Court held that;
"We have heard the learned counsel for petitioner.
We have pursued the judgment of the Hon'ble High Court of Kerala in Cri.Apl.No.161/1994 confirming the judgement/order of acquittal passed by Additional.
Session Judge, Thalassery in
Cri.Apl.No.212/1992 holding inter alia that the
cheque in questions having been issued by the 21 C.C.No.59268/2022 Accused for due which was barred by limitation the penal provision u/Sec.138 of the Negotiable Instrument Act is not attracted in the case.
On the facts of the case as available on the records and the clear and unambiguous provision in the explanation to Sec.138 of the Negotiable Instrument Act, the judgement of lower appellate court as confirmed by the High Court is unassailed.
Therefore, the Special Leave Petition is dismissed.
29. Further in the judgement of Hon'ble Kerala High court in the case of Sasseriyil Joseph V/s. Devassia dtd.22.9.2000 wherein the Hon'ble Kerala High Court held that;
6 - "The only question that arises for consideration in this application is whether the respondent who issued the cheque in question in discharge of a time barred debt is liable u/Sec.138 of the Negotiable Instrument Act. In this case, the Complainant had admitted that the loan was advanced to the Accused in January 1988 and the cheque was issued in February 1991. Thus, by the time, the cheque was issued, the debt was barred by limitation since there was no valid acknowledgement of the liability within the period of limitation. According to the learned counsel for Appellant, the promised made by the Accused to 22 C.C.No.59268/2022 repay the time barred debt, would come within the purview of Sec.25 (3) of the Indian Contract Act. No doubt, the promise to pay a time barred cheque (debt) is valid and enforceable, if it is made in writing and signed by the person to be charged therewith. But, it is clear from Sec.138 of N.I. Act that in order to attract the penal provisions in the bouncing of a cheque in Chapter XVII, it is essential that the dishonoured cheque should have been issued in discharge in wholly, or in part, or any debt or other liability of the drawer to the payee. The explanation to Sec.138 defines the expression debt or other liability as a legally enforceable debt or other liability. The explanation to the Sec. 138 reads as under;
Explanation - For the purpose of this section 'debt or other liability means a legally enforceable debt or other liability'.
7 - Thus, Sec.138 is attracted only if the cheque is issued for the discharge of legally enforceable debt or other liability. In this case, admittedly, the cheque in question was issued in discharge of a time barred debt. It cannot be said that a time barred debt is a legally enforceable debt. In this connection it is also relevant to note the decision of the Andhra Pradesh High Court reported in Giridhari Lal Rathi V/s. P.T.V. Ramanujachari 1997 (2) Crimes 658 it has been held 23 C.C.No.59268/2022 in that case that if a cheque is issued for a time barred debt and it is dishonoured, the Accused cannot be convicted u/Sec.138 of the N.I. Act simply on the ground has the debt was not legally recoverable. I am fully in agreement with the view expressed by the learned Judge in the decision referred to above.
8 - The learned counsel for Appellate placed strong reliance on the decision of Madras High Court reported in S.Krishnamurthy V/s. A.R. Rajan 1996 Cri.L.J.3552. In that case, it was contended for the Accused the cheque in question dtd.23.4.1989 alleged to have been issued in respect of the debts including under the promissory notes dtd.20.3.1985 and 8.4.1985 is not respect of legally enforceable debts and liabilities, within the meaning of Sec.138 of the N.I. Act since the debts under the Pro-notes are barred by limitation on the date of issuance of the cheque dtd.23.4.1989. But, the court found that in respect of alleged two time barred pro-notes, the Accused has paid interest on various dates and thereby the pro-notes have not become time barred. In this case, the Complainant has no case that the Accused has paid interest on the amount borrowed from him in 1987 and there valid acknowledgement of the debt within the period of limitation. As noticed earlier, since there was no acknowledgement of the debt before the expiry of 3 years from the date 24 C.C.No.59268/2022 of loan, the debt was not legally enforceable debt at the time of issuance of the cheque.
9 - For the reasons stated above, I find no reason to the interfere with the order of acquittal passed by Addl. Sessions Judge. I see no infirmity in the judgment of lower court, this appeal is groundless and is liable to be dismissed.
30. The above decisions of the Hon'ble Kerala High Court in the case of Sasseriyil Joseph V/s. Devassia is upheld by the Hon'ble Supreme Court of India as stated supra.
31. It is useful to refer the decision of Hon'ble High Court of Karnataka Kalburagi Bench in Cri.Apl.No.200057/2016 in the case of Bidar Urban Co-op.
Bank Ltd., V/s. Mr. Girish S/o. Late Gunderao Kulkarni the Hon'ble High Court observed that;
"Thus, for the purpose of filing within the ambit of Sec.138 of the Act, one of the ingredients which is required to be satisfied is that there is legally enforceable debt. In the facts of present case, as noted earlier, the amounts in question had been paid during the period 1991 to1997, under the circumstances, the period of limitation which is 3 years had clearly expired by the end of the year 2000. Therefore, the Cheques which were issued in the year 25 C.C.No.59268/2022 2002, evidently were issued in respect of time-barred debts. In view of the explanation to Sec.138 of the Act, a debt or liability referred to in Sec.138 of the Act means a legally enforceable debt. Under the circumstances, even if the case of the Complainant is accepted that such Cheques had, in fact, been issued by the Accused towards a debt of Rs.42 lakhs, even then, the same would be relatable to a time-barred debt and therefore, cannot be said to have been issued in respect of a legally enforceable debt. The provisions of Sec.138 of the Act would, therefore, not be attracted in the facts of present case.
Further the Hon'ble Court in para 36 of its judgement referred decision of Hon'ble High Court of Bombay in a case of Chandra Mohan Mehta Vs.William Rosario Fern Andes and Another reported in 2008 SCC Online Bombay 1590 referring to its earlier decisions and decision of Madras High Court in the case of N.Ethirajulu Naidu Vs. K.R. Chinnikrishnan Chettair AIR 1975 Madras 333 held at para No.7 and 8..........
Further the Hon'ble High Court also referred decision of Chacko Varkey Vs. Thommen Thomas AIR 1958 KER 31 of Full Bench of Kerala High Court considered the scope of Sec.25 (3) of the Indian Contract Act which also supports the Accused defence.26 C.C.No.59268/2022
The Hon'ble High Court in para No.39 observed that; in view of the principles stated in the above referred decision and discussion, it is evident that the penal provision of Sec.138 of N.I. Act is applicable only to the Cheques which are issued for the discharge in whole or in part, of any debt or other liability, which according to explanation must be a legally enforceable debt or other liability. A Cheque given in discharge of a time barred debt will not constitute an unconditional undertaking or promise in writing either expressly or impliedly so as to attract the criminal offence u/Sec.138 of N.I. Act. This was elaborated in SASSERIYIL JOSEPH's case (supra) which is affirmed by the Hon'ble Supreme Court as stated above. A Cheque given in discharge of a time- barred debt will not constitute a promise in writing not even an implied promise so as to attract a criminal liability u/Sec.138 of N.I. Act."
32. In the present case also admittedly the transaction took place between the parties on 1.6.2015 and Ex.P3 is handloan agreement also executed on 1.6.2015 and cheque was issued on 16.9.2022. In between 2015 to 2018 there is no any acknowledgement of debt in writing by the either party. The date of expiry of limitation was lapsed in the year 2018. The cheque was issued after lapse of 6 years on execution of Ex.P3. 27 C.C.No.59268/2022 Therefore, the debt is clearly time barred debt which was not enforceable under the law. Therefore, the present debt is not legally enforceable at the time of issuance of Cheque, the time limit for enforcement of cheque was lapsed. Therefore, the Complainant failed to prove that, the Ex.P1 Cheque was issued by the Accused for discharge of legally enforceable debt.
33. As observed in the above decisions, it is clear that, the Cheque amount is time barred debt and it is not legally enforceable debt. Therefore, the Accused is not liable to punish u/Sec.138 of N.I. Act. The Complainant has not proved his case as to commission of offence punishable u/Sec.138 of N.I. Act by the Accused. Hence, I answer Point No.1 in the Negative.
34. Point No.2 : In view of discussion held in Point No.1, I proceed to pass the following :
ORDER Acting U/S 255(1) of Cr.P.C., the accused is acquitted for the offence punishable Under Section 138 of Negotiable Instrument Act.
His personal bond stands cancelled.
(Dictated to the stenographer, transcribed by her, corrected by me and then pronounced in the open court on this 19th April, 2025) (PARVEEN A BANKAPUR) XXXIV ACJM, BENGALURU.
28 C.C.No.59268/2022ANNEXURE
1. Witnesses examined on behalf of Complainant:
P.W.1 Mr. Shashi Kumar
2. Documents marked on behalf of complainant:
Ex.P.1 Cheque Ex.P.2 Bank endorsement Ex.P.3 Handloan agreement Ex.P.4 Office copy of legal notice Ex.P.5 Courier receipt Ex.P.6 Courier track
3. Witnesses examined on behalf of Accused:
D.W.1 Mr. Prashanth B
4. Documents marked on behalf of Accused: NIL (PARVEEN A BANKAPUR) XXXIV ACJM, BENGALURU.