Karnataka High Court
Sri Yogesh Poojary vs Sri K Shankara Bhat on 20 November, 2018
Author: H.B.Prabhakara Sastry
Bench: H.B.Prabhakara Sastry
®
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 20TH DAY OF NOVEMBER, 2018
BEFORE
THE HON'BLE Dr. JUSTICE H.B.PRABHAKARA SASTRY
CRIMINAL APPEAL No.467 OF 2010
BETWEEN:
Sri.Yogesh Poojary,
S/o Dhinakara Poojary,
Aged 44 years,
R/o Kadthila House,
Mogru Village & Post,
Belthangadi Taluk,
Dakshina Kannada.
.. Appellant
(By Sri.Datta Prasad.G, Advocate for
Sri.Manmohan, Advocate)
AND:
Sri.K.Shankara Bhat,
S/o Thimmanna Bhat,
Aged about 65 years,
Kodiyadka House,
Thannirupantha Post,
Belthangadi Taluk,
Dakshina Kannada.
.. Respondent
(By Sri. A.Keshava Bhat, Advocate)
This Criminal Appeal is filed under Section 378(4) of
Cr.P.C, praying to set aside the judgment and order dated
18.02.2010, passed in C.C.No.365/2005 by the Court of
Crl.A.No.467/2010
2
the C.J.(Jr.Dn) and JMFC, Sullia, D.K. - acquitting the
respondent/accused for the offence punishable under
Section 138 of the N.I. Act and consequently allow
C.C.No.365/2005 as prayed for.
This Criminal Appeal having been heard and reserved
for Judgment on 15.11.2018, this day the Court delivered
the following:
JUDGMENT
In the complaint filed by the appellant under Section 200 of Code of Criminal Procedure (hereinafter for brevity referred to as 'Cr.P.C'), against the present respondent for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter for brevity referred to as 'N.I. Act'), the learned Civil Judge (Jr. Dn) & JMFC, Sullia, Dakshina Kannada (hereinafter for brevity referred to as the 'trial Court') in C.C.No.365/2005, pronounced the judgment of acquittal on 18.02.2010. It is against the said judgment of acquittal, the appellant/complainant has preferred this appeal.
Crl.A.No.467/20103
2. The summary of the case of the complainant in the trial Court is that the respondent/accused towards the repayment of the debt issued a cheque bearing No.0380 dated 10.12.2004, drawn on Thannirupantha Service Co- operative Bank Limited in favour of the complainant for `1,50,000/-. When the cheque was presented for realization by the complainant, the same was dishonoured and returned through his banker on 23.12.2004 with an endorsement 'payment stopped by drawer'. The complainant issued a legal notice to the accused demanding the repayment of the cheque amount within fifteen days from the date of receipt of the notice. However, the said notice returned unserved with a postal endorsement as the addressee was out of station and did not claim the letter. Since the demand made in the legal notice was not met by the accused, the complainant was constrained to file a Crl.A.No.467/2010 4 complaint against the accused for the offence punishable under Section 138 of the N.I. Act.
3. To prove his case, the complainant got himself examined as PW-1 and got marked documents from Exs.P-1 to P-10. No witnesses were examined from the accused side. However, documents at Exs.D-1 to D-12 were marked from his side. After hearing both side, the trial Court by its impugned judgment dated 18.02.2010, acquitted the accused for the alleged offence. It is against the said judgment, the appellant has preferred this appeal.
4. For the sake of convenience, the parties would be referred to as per their ranks before the trial Court.
5. It is the argument of the learned counsel for the appellant/complainant that the trial Court Crl.A.No.467/2010 5 committed an error by holding that there is no service of demand notice upon the accused. It is the contention of learned counsel that once there is tendering of the notice, which was sent to the accused at his correct and complete address even if, the addressee has not received the said letter, there will be a deemed service of notice.
Secondly, it was also the argument of learned counsel for the appellant/complainant that the finding of the Court below that it was a burden on the complainant to prove the existence of legally enforceable debt was also against the statutory presumption operating in favour of the complainant under Section 139 of the N.I. Act. In this regard, learned counsel relied upon two judgments of the Hon'ble Apex Court, which will be referred to at the relevant place hereafterwards.
Crl.A.No.467/20106
6. Learned counsel for the respondent, in his arguments fairly, submitted that in view of the settled principle of law that once a letter is sent to correct address under a registered post, unless and until the contrary is proved, the service is deemed to have been effected, he would not press the point of alleged non-service of notice upon the accused. However, he submitted that finding of the trial Court, on the merits of the case, does not warrant any interference at the hands of this Court. He also submitted that when the alleged earlier loan is said to have been remained unpaid by the accused then, how come the very same complainant could grant huge sum of loan again to the same accused? He also submitted that the complainant is in the habit of money lending to different people without any license for money lending and that he is also filing criminal cases for the offence punishable under Section 138 of the N.I. Act against Crl.A.No.467/2010 7 those alleged drawers of the cheques at different places intentionally. With these, he submitted that the appeal does not deserve to be allowed.
7. It is the complainant's averment as well the evidence of PW-1 that the statutory notice sent to the accused after the dishonour of the cheque and demanding him to make good the amount demanded in the notice, came to be returned unserved with the postal endorsement that the addressee was out of station and not claimed the article. It is not the case of the accused that the address to which the legal notice was sent under 'Registered Post Acknowledgment Due' was incorrect, as such, the legal notice was sent by the complainant to the correct address of the accused under registered post. In a similar circumstance, the Hon'ble Apex Court in the case of Ajeet Seeds Limited vs. K.Gopala Crl.A.No.467/2010 8 Krishnaiah reported in (2014) 12 SCC 685, was pleased to hold that there shall be presumption as to service of notice. Therefore, in the light of the said judgment of the Hon'ble Apex Court and also in view of the fact that learned counsel for respondent/accused has also fairly submitted that he would not press on the aspect of the alleged non- service of notice upon the accused, it has to be held that the finding of the Court below holding that there was no service of statutory notice upon the accused is an erroneous finding. As such, it is established that there is compliance of service of statutory notice by the complainant upon the accused as required under Section 138 of the N.I. Act.
8. The complainant in his complaint as well in his evidence as PW-1 has stated that the cheque under question which is for a sum of `1,50,000/- was Crl.A.No.467/2010 9 issued to him by the accused towards the discharge of his existing debt. However, the defendant in his defence has taken a contention that complainant was running a finance called Baby Finance Corporation at Madanthyaru, Belthangadi Taluk from whom he had availed a loan of `20,000/- and `10,000/-. At the time of availing those loans, the complainant had collected blank cheques as security. However, inspite of repayment of the said loan, the complainant has not returned those blank cheques but he has misused those cheques and filed a criminal case in question.
It is considering the said defence put forth by the accused in the form of suggestion to PW-1, in his cross-examination, the trial Court proceeded to analise the entire evidence placed before it with a notion that the existence of legally recoverable debt was not a matter of presumption under Section 139 of the N.I. Act. In that regard, it also relied upon the Crl.A.No.467/2010 10 judgment of the Hon'ble Apex Court in the case of Krishna Janardhan Bhat vs. Dattatraya G. Hegde reported in (2008) 4 SCC 54. However, the said observation of the Hon'ble Apex Court that the existence of legally recoverable debt was a matter of presumption was not accepted by a Full Bench of Hon'ble Apex Court in the case of Rangappa vs. Sri Mohan reported in (2010) 11 SCC 441, wherein at paragraph No.26 of the judgment, the Hon'ble Apex Court was pleased to observe that the presumption mandated by Section 139 of N.I. Act does indeed include the existence of a legally enforceable debt or liability. As such, to that extent, the impugned observations in the case of Krishna Janardhan Bhat (supra) may not be correct. Therefore, the principle which hold the ground as of now is that the presumption mandated by Section 139 of the N.I. Act includes the presumption that there existed a legally Crl.A.No.467/2010 11 enforceable debt or liability. However, such presumption is rebuttable in nature.
9. In the instant case, the issuance of cheque in question by the accused to the complainant is not in dispute. It is the accused, who himself has in the form of suggestions made to PW-1 in his cross-examination has specifically stated that the cheque in question was issued by him to the complainant, however, as a security towards his alleged previous loan of a sum of `20,000/- and `10,000/-. But the said suggestion was not admitted as true by PW-1. Therefore, merely by making a suggestion which has remained unacceptable by the complainant cannot be taken as proof of the defence of the accused, who has made such suggestion. In such a situation, a corroborative evidence either oral or documentary may require to be placed before the Court. However, the accused except Crl.A.No.467/2010 12 making such a suggestion, as observed above, to PW- 1 in his cross-examination has not placed any material corroborating his defence. Therefore, as observed by the Hon'ble apex Court in the case of T.Vasanthakumar vs. Vijayakumari reported in (2015) 8 SCC 378, wherein also in a similar circumstance of the case, the Hon'ble Apex Court held that the defence of the accused that the cheque in question was given to the complainant as a security was not held as acceptable, it has to be held that the accused was not able to convincingly rebut the presumption existing in favour of the complainant under Section 139 of the N.I. Act.
10. The trial Court, as already observed above, proceeded in the matter on the basic notion that the burden of proving the existence of legally enforceable debt was primarily on the shoulder of the Crl.A.No.467/2010 13 complainant. It is in that process, it has observed that the statement of the complainant that despite the accused being earlier defaulter of two hand loans of `20,000/- and `10,000/- respectively was again granted with a loan of `1.5 lakhs was unbelievable. However, while coming to such a conclusion, the trial Court ignored the reason given by PW-1 in his cross- examination that since the accused is known to him, and is not only close to him but also the wife of the accused being his (complainant's) neighbour, he has extended further loan to accused. The said reasoning find no reason to disbelieve it.
11. It is also the argument of the learned counsel for the respondent/accused that the complainant is a money lender and he has instituted several similar cases against different persons in different Courts at different places. He has also relied upon Exs.D1 to D6 in that regard. No doubt Exs.D1 to Crl.A.No.467/2010 14 D6 are the certified copies of three different private complaints and three different cheques which go to show that the complainant has instituted similar cases against other persons at different places but by the said Act itself, it cannot be said that the complainant had no right to institute the present complaint against the accused for the alleged cause of action or that his case is doubtful. As such, the said argument of the learned counsel for the respondent/accused is also not acceptable. However, the trial Court without confining its reasons to materials available in the form of oral and documentary evidence placed before it, proceeded to assume certain things on its own. Some of them being that as to non-preparing any documentation for the loan of `1.5 lakhs by the complainant and also about the alleged non-disclosure of alleged loan transaction in the Income Tax Returns of the complainant.
When the accused in the process of Crl.A.No.467/2010 15 rebutting the presumption existing in favour of the complainant under Section 139 of the N.I. Act apart from making a mere suggestion as to absence of any documentation about the alleged loan transaction and absence of non-disclosure of the loan transaction in the Income Tax Returns is also required to place more material either in the form of favorable replies elicited in the cross-examination of the complainant or in the form of documents or atleast bringing to the notice of the Court and convincing it that the circumstances of the case warrants for drawing such a conclusion, particularly, mere making a suggestion to the complainant that he has not disclosed the alleged loan transaction in his Income Tax Returns or eliciting the statement from the complainant that he has not disclosed the alleged loan transaction in his Income Tax Returns by itself is not sufficient. It is also required for the accused to establish that the Crl.A.No.467/2010 16 complainant is an income tax assessee or required to be an assessee and that the nature of his income tax assessment and the Income Tax Return which he files, requires him to disclose the alleged transaction or the liability in question. In the absence of eliciting those details, by merely making a suggestion that the alleged debt or liability, has not been reflected in the income tax returns would not by itself suffice to draw an adverse inference and to hold that there was no legally enforceable debt or the presumption standing in favour of the complainant as successfully rebutted by the accused.
The trial Court in the instant case, merely considered a suggestion made from the accused side in the cross-examination of PW-1 that the complainant was an income tax assessee and that he has not declared the alleged loan transaction in his returns and disbelieved the case of the complainant that too, ignoring that legal presumption under Crl.A.No.467/2010 17 Section 139 of the N.I. Act, was operating in favour of the complainant. For these reasons, it has to be held that the complainant has beyond reasonable doubt proved the guilt of the accused punishable under Section 138 of the N.I. Act. As such, the impugned judgment of acquittal passed by the trial Court deserves to be set aside and respondent/accused is liable to be convicted for the offence punishable under Section 138 of the N.I. Act.
12. Accordingly, the Appeal stands allowed. The judgment of acquittal dated 18.02.2010, passed by the learned Civil Judge (Jr.Dn) and JMFC, Sullia, Dakshina Kannada, in C.C.No.365/2005, is set aside. The respondent/accused by name - K.Shankara Bhat, S/o Thimmanna Bhat, residing at Kodiyadka House, Thannirupantha Post, Belthangadi Taluk, Dakshina Crl.A.No.467/2010 18 Kannada, is convicted for the offence punishable under Section 138 of N.I.Act.
To hear on the sentence and for pronouncement of order on sentence, call the matter at 2.30 p.m. Sd/-
JUDGE dn/-
Crl.A.No.467/201019
ORDER ON SENTENCE Heard the learned counsel from both side on sentence part.
While the learned counsel for the appellant/ complainant submits for awarding maximum sentence for the offence for which the respondent/accused is convicted, the learned counsel for the respondent/accused submitting that accused is a family holder and a respectable person in society, prays for taking a lenient view.
It is the sentencing policy that the sentence ordered should not be either exorbitant nor for name sake for the proven guilt. It must be proportionate to the guilt for which the accused is found guilty of.
Considering the facts and circumstances of the case, the accused is sentenced to pay a fine of `1,60,000/- (Rupees One Lakh Sixty thousand) within Crl.A.No.467/2010 20 three weeks from today, and in case of default of payment of fine, to undergo a simple imprisonment for a period of six months. In case of payment of fine amount, a sum of `1,50,000/- be paid to the complainant - Yogesh Poojary, and remaining sum of `10,000/- be taken to the account of the State.
The Registry is directed to transmit a copy of this judgment to the trial Court forthwith, which Court to proceed further in the matter for issuance of warrant of conviction, if necessary and proceed in accordance with law.
The entire copy of this judgment also be delivered to the respondent, immediately free of cost.
Sd/-
JUDGE dn/-