Bangalore District Court
Smt. C.Thilakavathi vs Smt. Prathima on 7 March, 2026
KABC030094442017
IN THE COURT OF THE XIX ADDITIONAL CHIEF
JUDICIAL MAGISTRATE AT BENGALURU CITY.
Dated this the 07th day of March, 2026.
PRESENT:SMT.RASHMI H.B., B.A.(LAW)LL.B.,LLM.,
XIX ADDL.C.J.M., BENGALURU CITY.
C.C.No.4379 of 2017
Complainant :- Smt.C.Thilakavathi,
W/o.P.Jagan,
Aged about 33 Years,
R/at.No.103, 11th Main,
J.C.Nagar, Kurubrahalli,
Mahalakshmipuram,
Bengaluru - 560086.
(Rep. By Sri.H.R.S, Advocate)
-V/s-
Accused :- Smt.Prathima,
W/o. Kumar,
Aged about 33 Years,
R/at.No.24, 2nd Cross,
Sri Nanjudeshwara Swamy
Nilaya, Lavakusha Nagar,
L.G.Ramanna Layout, Opp.
Basavaraja Swamy Nursing
College, Laggere,
Bengaluru - 560058.
(Rep. By Sri.K.H.M., Advocate)
Date of complaint :- 06-02-2017
Date of Commencement :- 06-02-2017
of evidence
2 C.C.No.4379/2017
Offence complained :- Section 138 of N.I.Act
Opinion of the Judge :- Accused is found guilty.
(SMT.RASHMI H.B.,)
XIX ADDL.C.J.M., Bengaluru City.
JUDGMENT
This is a private complaint filed under section 200 of Cr.P.C., against the accused for the offence punishable under section 138 of the Negotiable Instruments Act.
02.The brief facts of the complaint is as under:
The complainant and accused are well known to each other. The accused has availed a hand loan of Rs.5,00,000/-
on 19-06-2016 in cash from the complainant to meet her domestic expenditures and agreed to return the same within three months from the date of loan borrowed. On the same day, the accused has issued a post-dated cheque bearing No.194423 dated 19-09-2016 for Rs.5,00,000/-, drawn on Canara Bank, Rajajinagar 3rd Block branch, Bengaluru, in favour of the complainant. The complainant presented said 3 C.C.No.4379/2017 cheque for encashment through her banker Corporation Bank, Mahalakshmi Layout Branch, Bengaluru on 21-11-2016. The cheque is returned unpaid with bank endorsement dated 22-11-2016 showing cheque is dishonoured for the reason "Funds Insufficient". Thereafter, the complainant has got issued legal notice to the accused on 21-12-2016 through registered post and the same served upon accused on 24-12- 2016. But, the accused has failed to make payment of cheque amount. Hence, complainant has filed this complaint on 06-02-2017.
03. After presentation of complaint, this Court took cognizance of offence and recorded the sworn statement of complainant. Thereafter, a criminal case is registered against accused and summons is issued to the accused. The accused appeared through her counsel and she is enlarged on bail. The copies of the complaint and other papers furnished to the accused. Substance of accusation was read over to her. Accused has pleaded not guilty and claimed to be tried.
4 C.C.No.4379/2017
04. As per directions of Hon'ble Supreme Court of India in Indian Bank Association vs Union of India reported in 2014 (5) SCC 590, the sworn statement is treated as examination in chief of complainant. In order to prove the accusation made against the accused, the complainant examined herself as PW1 and got marked 04 documents as Ex P1 to Ex.P4 and Ex P3(a).
05. Thereafter, statement of accused is recorded under section 313 of Cr.P.C. wherein the accused has denied the incriminating evidence found on record as false and she submitted she would lead defence evidence. The accused examined herself as DW1 and got marked 09 documents as Ex.D1 to 9.
06. Heard the arguments of learned counsels for complainant and accused. Perused entire case record carefully.
07. On the basis of contentions raised in the complaint the points that arises for determination of this Court are as follows:
5 C.C.No.4379/2017
1.Whether the complainant proves that, the accused issued the cheque towards discharge of legally enforceable debt?
2.Whether the complainant proves the guilt of the accused for the offence punishable under section 138 of Negotiable Instruments Act?
3.What order?
08. Now, this Court answers to above points are as follows:
Point No.1: In the Affirmative;
Point No.2: In the Affirmative;
Point No.3: As per final order for the following:
:: R E A S O N S ::
09. POINTS No.1 and 2: Since these points are inter-relating with each other, they are taken up together for common discussion to avoid the repetition of facts and findings.
10. This case is tried as summons case. As this matter is tried as summons case, this Court relies on the evidence recorded by learned predecessor in office. In that regard, this 6 C.C.No.4379/2017 Court relies on decision of Hon'ble Supreme Court of India in the case of Mehsana Nagarik Sahkari Bank Ltd., V/s Shreeji Cab Co. & Others reported in 2014(13) SCC 619. Wherein the Hon'ble Supreme Court had observed that de- nova hearing is necessary only when the evidence is recording in summary manner. Therefore, this Court has proceeded with the case on the basis of part evidence recorded previously.
11. Before proceeding with the discussion, in order to prove the guilt of offence under section 138 of N.I. Act, initial burden casts on the complainant to prove the following ingredients:
a) The cheque must have been drawn
for discharge of existing debt or
liability.
b) Cheque must be presented within
validity period.
c) Cheque must be returned unpaid due
to insufficient funds or it exceeds the amount arranged.
d) Fact of dishonour be informed to the
drawer by notice within 30 days.
e) Drawer of cheque must fail to make
payment within 15 days of receipt of
the notice.
7 C.C.No.4379/2017
12. In order to prove the case, the complainant - Smt.C.Thilakavathi, has examined herself as PW1. The PW1 has filed an affidavit in lieu of examination-in-chief reiterating entire complaint averments. In support of her oral evidence, she has produced Ex.P1 to Ex.P4 documents. The complainant got marked one original cheque as Ex.P1, signature of accused as Ex.P1(a), one bank endorsement as Ex.P2, demand notice as Ex.P3, postal receipt as Ex.P3(a) and postal acknowledgment as Ex.P4.
13. During cross-examination of PW1, she has revealed by searching details in social media she found accused is presently working as trustee of Orphan Ashrama. At the time of the transactions, she was working as teacher. The PW1 admitted the fact that she did not produced document to show income derived from PW1 and her husband. PW1 has explained to purchase a house, accused sought financial help from her. PW1 has admitted the fact that the writings and signature of the cheque in its style and ink are different. The defence has suggested one 8 C.C.No.4379/2017 Savitha, a beautician of Nandini Layout was running a chit to which accused was subscriber and she was taking cheque as security. PW1 deposed her ignorance about the said fact. As another criminal case for dishonour of cheque filed against this accused by Savitha was dismissed, out of three cheques taken as security by savitha, one of the cheque is misused for wrongfull gain through her. PW1 has denied said suggestions as false. The accused suggested she was having sufficient financial stability and she did not require to borrow amount from PW1. The said suggestions answered as not true.
14. The evidence of PW1 and Ex.P1 to Ex.P4 clearly show the complaint is filed within time and all the ingredients of section 138 of N.I.Act. The cheque is issued for legally recoverable debt and it is dishonored for 'Funds Insufficient'.The said fact is brought to the notice of accused. Till date the accused did not comply the demand of the complainant for payment of amount mentioned in the cheque. Therefore, PW1 has discharged her burden to prove 9 C.C.No.4379/2017 the ingredients of the offence punishable under section 138 of Negotiable Instruments Act.
15. Another aspect is to consider whether the Ex.P1 cheque and Ex.P1(a) signature belongs to the accused or not. The defense has admitted Ex.P1 cheque belong to accused and it bears her signatures. These facts clearly shows that the cheque in dispute is belongs to accused and she has signed the said documents. Therefore, presumption under section 118 and 139 of N.I. Act lies in favour of the complainant.
16. As per provision of section 118 and 139 of N.I. Act, the court has to presume liability of the accused and to such amount mentioned in the cheque to discharge legally recoverable debt. The said aspect was denied by the accused. Once the execution of cheque is admitted section 139 of the Act, mandates a presumption that the cheque was for the discharge of any debt or other liability. Thereafter, the onus of proving probable defense of the accused is on accused and standard of proof for rebutting 10 C.C.No.4379/2017 presumption is preponderance of probabilities. To rebut presumption it is open for the accused to rely on evidence or the accused can also rely on the materials submitted by the complainant in order to raise probable defense.
17. In that regard, the Hon'ble Supreme Court of India in its Judgment reported in 2019(5) SCC 418 in the case of Basalingappa V/s Mudibasappa discussed the manner in which accused could rebut the presumption raised under section 118 and 139 of Negotiable instruments Act. The Hon'ble Supreme Court of India in the case of Basalingappa Vs. Mudibasappa reported in 2019 (5) SCC 418 laid down principles regarding how presumption under section 118 and 139 of N.I.Act can be rebutted.
18. To rebut the presumptions, accused entered into witness box as DW1. She has deposed PW1 and herself studied in same college and she did not done any financial transaction with PW1. She is running a Suprabha Educational and Charitable Trust since from 10.10.2014. She was working as teacher from 2007 to 2013 at 11 C.C.No.4379/2017 Vidyaniketan School. She has deposed in the year 2016 she was residing at Leggere Chowdeshwari Nagar and at that time she never purchased a house. She had no necessity to avail loan from any person. She has deposed in the year 2014-15 she has subscribed chit with one Savitha and handed over three signed blank cheques including Ex.P1 cheque in the signed blank form as security. The complainant has also invested in the same chit. Though chit transactions were complete, she did not return the security cheques. Further Smt.Savitha has filed a case for dishonour of cheque against her before this court, which was ended with her acquittal. Therefore, she has misused another security cheque through complainant.
19. In support, accused has got marked notarized copies of 4 Statement of Marks Cards as Ex.D1 to Ex.D4, notarized copy of B.Ed., Degree Certificate as Ex.D5, Form No.15 as Ex.D6, Property Tax Receipt as Ex.D7, Notarized copy of Trust Deed as Ex.D8 and certified copy of Judgment passed in C.C.No.7767/2016 dated 03-12-2018 as Ex.D9. 12 C.C.No.4379/2017
20. During cross-examination, DW1 has deposed that she is M.A, B.Ed graduated. PW1 is working as Librarian. She deposed ignorance about financial status of husband of complainant. She has admitted the fact that complainant has own house at Kurubarahalli. But DW.1 deposed her ignorance about rental income. She has admitted the fact that cheque belong to her and it bears her signature. She has admitted her signature in Ex.P4 postal acknowledgment card and she has explained, she had collected the demand notice from the postman. She has admitted the fact that she did not replied the demand notice. She has admitted the fact that court process served to her address mentioned in the cause title. She has admitted complainant is also financially stable. She has deposed no document available to show she had hand over three signed blank cheques. She has admitted the fact that no reference of Ex.P1 cheque is made in the Ex.D9-Judgement.
21. On going through evidence on record, the accused took specific defence that accused had no necessity to 13 C.C.No.4379/2017 borrow the loan from complainant. Further she has taken specific defence that she has handed over three signed blank cheques to one Smt.Savitha who was running a chit fund as security. Out of which, one cheque misused by Smt.Savitha and case related to it is ended with acquittal as per Ex.D9. Out of which, another cheque is misused by Smt.Savitha through complainant herein.
22. On going through the evidence on record, Ex.D9 shows facts of the case in Ex.D9-Judgement in C.C.No.7767/2016, that cheque bearing No.194425 dated 26.05.2015 for Rs.4,00,000/- was the subject matter and said complaint was filed in the year 2015. In the said case cheque was dishonoured for the reason "Account Blocked". In the said case this court has found the accused was a teacher and she was not doing business and no proof is produced to show she has availed loan for improvement of business. As per the said judgement Smt.Savitha had admitted the fact that she was running a chit business wherein accused was a member. Though she has denied 14 C.C.No.4379/2017 any cheques are received as security, on probability defence of accused is considered. Further for non proving of financial capacity by complainant, accused was acquitted.
23. The accused has produced documents to show her educational background. Further she has produced Encumbrance certificate to show on 15-11-2012, she and her husband have purchased the house property.
24. The Hon'ble Supreme Court of India in its reported judgement in 2023(10) SCC 148 in the case of Rajesh Jain vs Ajay Singh in para 55 observed as follows:
'55. At the stage when the courts concluded that signature had been admitted, the court ought to have inquired into either of the two questions (depending on the method in which the accused has chosen to rebut the presumption): Has the accused led any defence evidence to prove and conclusively establish that there existed no debt/ liability at the time of issuance of cheque? In absence of rebuttable evidence being led the inquiry would entail: Has the accused proved the non-existence of debt/liability by 15 C.C.No.4379/2017 preponderance of probabilities by referring to the particular circumstances of the case?"
25. On considering the said legal proposition, the accused in this case did not admit she has handed over the cheque to complainant. But accused has contended she has given three cheques as security for the chit transaction run by Smt.Savitha. As per Section 41 of Indian Evidence Act, the Ex.D9-Judgment is not a conclusive proof about that Ex.P1 cheque is given in blank signed form by accused to one Smt.Savitha. The fact of handing over Ex.P1 cheque in signed blank form to Smt.Savitha is required to be probablised in this case independently. The Ex.D9 judgement does not refer three cheques were handed over to Smt.Savitha as security. When the accused was aware of the fact that, one of her security cheque is misused in the year 2015 itself, she did not lodge any complaint before jurisdictional police to get back her three security cheques. Alternatively, she did not issued notice to Smt.Savitha to call upon her to return three cheques. No such legal action taken by accused against Smt.Savitha or complainant, even 16 C.C.No.4379/2017 filling of the said case. Further DW.1 has admitted the fact that, she has received demand notice in this case as per Ex.P4 Postal Acknowledgment card. But she did not sent reply notice making the defence.
26. It is evident to note when accused is aware that she did not handed over the cheque to complainant, naturally she would have approached the police or court of law regarding misuse of cheque against the complainant. Further accused did not explain the nexus between the complainant and Smt.Savitha. It is evident to note explanation of accused that complainant is also chit member of Smt.Savitha does not give any inference about Smt.Savitha colluding with complainant to misuse the cheque.
27. In the Ex.D9-judgement, referred cheque is no 194425 and DW.1 did not give any explanation in this case why said cheque is instructed to be blocked. As DW.1 has given only one cheque as security which under apprehension of misuse was appeared to have instructed the bank to block the cheque. This case cheque is no 17 C.C.No.4379/2017 194423 is not instructed to stop payment or to block by complainant. Further considering her own versions, accused being aware of the cheque given as security in the year 2015, she did not give any instructions to bank to stop payment as she done to the cheque in question of Ex.D9.
28. The accused did not produce bank statements or income tax returns to prove financial stability. The defence suggestion that the accused purchased a house property in the year 2010 and sold it in 2013 does not establish that she had no intention to purchase another house in 2016. As the complaint states that the loan was taken for domestic purposes, it was the accused's responsibility to prove that she had no financial need. However, she failed to show that she and her family were financially stable in 2016. Further, the accused failed to prove any connection between the complainant and Smt.Savitha. Acquittal in another case involving a different transaction and person cannot be a ground for acquittal in this case. The accused also failed to prove that her cheque was misused by the complainant. Considering the defence and the evidence on record, the 18 C.C.No.4379/2017 accused has not raised a probable defence to rebut the presumption.
29. The learned counsel for accused argued as complainant failed to prove financial capacity. At this stage it is relevant to discuss about judgment of Hon'ble Supreme Court of India in 2020 SCC OnLine SC 193 in the case of APS Forex Services Pvt. Ltd vs Shakti International Fashion Linker and Other in para 20 held , which reproduced as follows :
"20. Now so far as the reliance is placed by Learned Counsel appearing on behalf of the accused on the decision of this Court in the case of Basalingappa (supra), on going through the said decision, we are of the opinion that the said decision shall not be applicable to the facts of the case on hand and/or the same shall not be of any assistance to the accused. In that case before this Court, the defense by the accused was that the cheque amount was given by the complainant to the accused by way of loan. When the proceedings were initiated under Section 138 of the N.I. Act the accused denied the debt liability and the accused raised the defense and questioned the financial capacity of the complainant. To that, the complainant failed to prove and establish his financial capacity. Therefore, this 19 C.C.No.4379/2017 Court was satisfied that the accused had a probable defense and consequently in absence of complainant having failed to prove his financial capacity, this Court acquitted the accused. In the present case, the accused never questioned the financial capacity of the complainant. We are of the view that whenever the accused has questioned the financial capacity of the complainant in support of his probable defense, despite the presumption under Section 139 of the N.I. Act about the presumption of legally enforceable debt and such presumption is rebuttable, thereafter the onus shifts again on the complainant to prove his financial capacity and at that stage the complainant is required to lead the evidence to prove his financial capacity, more particularly when it is a case of giving loan by cash and thereafter issuance of a cheque. That is not a case here."
30. On going through said legal proposition, the accused has to make probable defence to disbelieve the case of complainant, then only burden shifts on complainant to prove the financial capacity. It is not mandated on the complainant to prove financial capacity at the first instance. Therefore it is mandated on the accused to make probable defence regarding non existence of loan 20 C.C.No.4379/2017 and misuse of cheques. But in this case accused has failed to make probable defence regarding misuse of cheque. Further accused took inconsistent versions regarding financial capacity of complainant. During cross examination of DW.1, she had admitted the financial capacity of complainant as good. Therefore accused has double standard on financial capacity of complainant. Once accused has admitted the financial capacity, question of considering the financial capacity of complainant does not arise. Further accused did not send reply notice to dispute financial capacity of complainant at the first instance when demand notice served on her. Therefore, it is not necessary to look into financial capacity of complainant to draw inference regarding defence.
31. As per section 139 of the N.I.Act, it shall be presumed unless contrary is proved, that the holder of cheque has received the cheque of the nature referred to in section 138 of N.I. Act for discharge in whole or in part of any debt or other liability. The Full bench judgement of 21 C.C.No.4379/2017 Hon'ble Supreme Court of India in the case of Rangappa vs Sri Mohan reported in 2010(11) SCC 441 has held that presumption mandated by section 139 of N.I.Act does indeed include the existence of legally enforceable debt or liability. Therefore, once the initial burden is discharged by the complainant that the cheque is issued by accused and the signature, the burden casted on the accused to prove the contrary that cheque is not issued for any debt or other liability. The said proposition of law is laid down by Hon'ble Supreme Court of India in the case of the P Rasiya V/s. Abdul Nazer and another. In the Judgement of Hon'ble Supreme Court of India reported in 2021 (5) SCC 283 in the case of M/S Kalamani Tex V/s.
P.Balasubramanian. In the para 13 of said Judgement the Hon'ble Supreme Court observed as follows:
"13. Adverting to the case in hand, we find on a plain reading of its judgement that the trail court completely overlooked the provisions and failed to appreciate the statutory presumption drawn under section 118 and section 139 of N.I.A. The statute mandates that once the signature(s) of an accused 22 C.C.No.4379/2017 on the cheque/negotiable instrument are established, then these "reverse onus" clause become operative. In such a situation, the obligation shifts upon the accused to discharge the presumption imposed upon him. The point of law has been crystalised by the court in Rohitbhai Jivanlal Patel vs State of Gujarath..."
32. Considering aforesaid legal proposition, burden casted on accused to disprove the case of complainant and his defence must be found more probable. No admissions elicited from the mouth of PW1 about misuse of the cheques. Therefore, defence of accused is found not probable and her evidence is not credible to believe.
33. Once the initial burden is discharged by the complainant that the cheque is issued by accused and the signature, the burden casted on the accused to prove the contrary that cheque is not issued for any debt or other liability. However, in this case accused has failed to make probable defence to rebut the presumptions. The defence of accused is found self serving statement and it is not sufficient to rebut the presumptions. Hence, on the basis of 23 C.C.No.4379/2017 the evidence of PW.1 and Ex.P1 to P4 documents, the complainant has proved the case and complainant is entitled for recovery of the amount as compensation.
34. On considering the facts and circumstances of the case, the complainant has able to establish that Ex.P1 cheque is issued to discharge liability of repayment of Rs.5,00,000/- to complainant by the accused. Ex.P1 is dishonoured for the reason "Funds Insufficient" in the account of accused and complainant is entitled for the cheque amount as compensation. The Hon'ble High Court of Karnataka in its reported judgement in 2025 SCC Online KAR 786 in the case of A V Poojappa V/s. Dr. S.K.Vagdevi rep by her Special Power of Attorney Holder Sri.H.V.Shivashankar in Para No.24 discussed the following aspect while imposing punishment, which reads as follows:
"24. While imposing the punishment, the Courts are required to examine the following aspects:
1. The quantum of the loan 24 C.C.No.4379/2017
2. The defence taken by the accused, more particularly whether he has taken a false defence and failed to prove the same.
3. Whether the accused has dragged on the matter unnecessarily and thereby delayed the disposal of the case at the stage of trial, appeal, revision,
4. Whether the transaction relates to business between the parties or the parties are business class who would have utilized the amount for their business and flourish, or
5. In other cases, the returns the loan amount would have brought, if it was kept in a fixed deposit in a nationalized bank etc,"
35. On considering said legal aspect, cheque is dated 19-09-2016. Already 8 years 5 months have lapsed from inception of the complaint. If said cheque amount kept in FD in nationalized bank, interest at the rate of 6% per annum would have been accrued. Therefore, it would be appropriate to award additional compensation of Rs.2,50,000/- as cost of the proceedings in favour of complainant. As per the judgement of Hon'ble High Court of Karnataka in Crl. Rev. Pet. No.996/2016 dated 09-07- 25 C.C.No.4379/2017 2025 in the case of M/s Banavathy & Company V/s. Mahaeer Electro Mech(P) Ltd has held as follows:-
"While passing the order of sentence after determining the fine/Compensation, the court shall also pass an order to pay future interest at the rate of 9% per annum on the compensation amount payable to the complainant by fixing time of one or two months to deposit compensation amount so that even if the matter is challenged before the Sessions Court in appeal and High Court in revision the interest of the complainant will be protected".
36. Considering the said legal proposition, it would be appropriate to award 9% per annum interest on the compensation amount payable to complainant if accused failed to comply the order of sentence within one month. The accused is not a repeated offender. Hence, there is no need to award imprisonment term. However, accused is liable to pay the fine amount of Rs.10,000/- to the state towards litigation expenses. Under these circumstances, this Court answers Points No.1 and 2 in the Affirmative. 26 C.C.No.4379/2017
37. POINT No.3: For the foregoing reasons stated in the Point Nos.1 and 2, this Court proceeds to pass the following:
ORDER The accused is found guilty for the offence punishable under section 138 of Negotiable Instruments Act.
Acting under section 255(2) of Cr.P.C, the accused is convicted for the offence punishable under section 138 of the Negotiable Instruments Act. The accused is sentenced to pay a fine of Rs.7,60,000/- within one month and in case of default she shall undergo simple imprisonment for 6 months.
Out of the fine amount Rs.7,50,000/-
shall be paid to the complainant as compensation as per section 357(1)(b) of Cr.P.C. with future interest at the rate of 9% per annum if accused failed to deposit compensation amount within stipulated time of one month. The remaining amount of Rs.10,000/- shall be defray to the State.27 C.C.No.4379/2017
In view of section 437(A) of Cr.P.C. bail bonds stand extended for 6 months from this date.
Supply free copy of Judgment to the accused.
(Dictated to the stenographer directly on computer, typed by her, revised and corrected by me and signed, pronounced in the Open Court this 07 t h day of March, 2026 ) (SMT.RASHMI H.B.,) XIX ADDL.C.J.M., Bengaluru City.
::ANNEXURE::
List of Witnesses examined for Complainant:-
PW1 :- Smt.C.Thilakavathi.
List of Documents marked for Complainant:-
Ex.P1 :- One Original Cheque, Ex.P1(a) :- Signature of Accused, Ex.P2 :- One Bank Endorsement, Ex.P3 :- Office copy of the Legal Notice, Ex.P3(a) :- One Postal Receipt, Ex.P4 :- Postal Acknowledgment.
List of Witnesses examined for Accused:-
DW1 :- Smt.Prathima.
List of Documents marked for Accused:-
Ex.D1 to 4 :- N/copies of 4 Statement of Marks Cards, Ex.D5 :- N/copy of B.Ed., Degree Certificate, 28 C.C.No.4379/2017 Ex.D6 :- Form No.15, Ex.D7 :- Property Tax Receipt, Ex.D8 :- N/copy of Trust Deed, Ex.D9 :- C/copy of Judgment in CC.No.7767/2016.
(SMT.RASHMI H.B.,) XIX ADDL.C.J.M., Bengaluru City.29 C.C.No.4379/2017