Bangalore District Court
C B Chandrashekar Setty vs R Manjunatha Bhagwath on 23 October, 2025
CC.No.32833/2018
KABC030902752018
Presented on : 13-12-2018
Registered on : 13-12-2018
Decided on : 23-10-2025
Duration : 6 years, 10 months, 10 days
IN THE COURT OF THE XVI ADDITIONAL CHIEF
JUDICIAL MAGISTRATE, BENGALURU CITY
Dated: This the 23rd day of October 2025
Present: Smt.Tejaswini K.M., B.A.L. LL.M,
XVI Addl.C.J.M., Bengaluru City.
CC. No.32833/2018
Sri.C.B.Chandrashekar Setty
Aged about 63 years
S/o C.Bhemaraya Setty
R/at #43, Datta Krupa Nilaya,
Vinayaka Nagara,
Near Chithrakuta School,
Nagadevanahalli, Kengeri Upanagar,
Bengaluru - 560091.
....Complainant
(By Sri.K.Suresh, Advocate)
Versus
2 32833/2018
R.Manjunatha Bhagwath
Aged about 31 years
S/o Ramakrishna
#32, Near Aravind School,
Near Banashankri Temple,
Vivekananda Colony,
J.P.Nagar 1st Phase,
Kanakapura Main Road,
Bengaluru - 560078.
And also at:
#39, Sunrise Layout,
2nd Cross, Besides Mahima Residency,
Yelachenahalli,
Bengaluru - 560062.
#294/2, Saadhana
Naadar Colony,
Opp: Kalamanakere, Yellapura,
Uttara Kannada District,
Karnataka - 581359.
Thotada Mane, Near Yellapura,
Yellapura - 581359,
Uttara Kannada District.
(
.... Accused
(By Sri.R.Venkata Reddy ., Advocate)
3 32833/2018
Offence complained : U/Sec.138 of Negotiable
Instrument Act.
Date of commencement
of evidence : 04.12.2018
Date of closing evidence : 30.12.2024
Opinion of the Judge : Accused found guilty
Offence complained : U/Sec.138 of Negotiable
Instrument Act.
Opinion of the Judge : Accused found guilty
JUDGMENT
This case is registered against the accused for the offence punishable U/s 138 of Negotiable Instruments Act.
2. Factual matrix of the complainant's case is as under:
It is stated that he is a devotee of Shanimahatma Got and used to visit Shanimahatma Temple, 4 32833/2018 Banashankari, Bengaluru frequently and the accused being a priest at the said temple, has become friend of the complainant and has got developed immense faith in the accused. In the second week of August 2015, the accused has approached the complainant and requested for hand loan of Rs.30 lakhs for constructing house and for his immediate family necessities. The complainant has trusted him and arranged a sum of Rs.28 lakhs and same was received by the accused by way of cash on 09.09.2015. The accused has assured to repay it within one year with interest @ 18% per annum. After lapse of one year again the accused has requested the complainant to pay a sum of Rs.20 lakhs towards his legal necessities and the complainant has arranged a sum of Rs.10 lakhs on 16.11.2016 and another sum of Rs.10 lakhs on 30.11.2016 and same was received from the complainant by the accused by way of cash and the 5 32833/2018 accused has agreed to pay the same within 2 months and towards discharge of part liability, the accused has issued 2 cheque bearing No.779308 and cheque bearing No.779312 dated 06.01.2017 for Rs.10,00,000/- each, drawn on State Bank of Mysore, Sarakki Branch, Bengaluru. The complainant has presented the cheques on 15.02.2017 and same got dishonoured for the reason 'funds insufficient' vide memos dated 15.02.2017 and they were received by the complainant on 17.02.2017.
3. After that he approached the accused, but the accused regretted for the inconvenience and postponed to make payment on one or other ground. After that the accused started threatening the complainant that he will file a false complaint against him. Therefore, complainant got issued a legal notice dated 08.03.2017 to the accused through RPAD calling upon the accused to make payment of cheques amount within stipulated period. The accused 6 32833/2018 avoided to receive the notice and it was returned on 21.03.2017 with an endorsement as 'not claimed'. Thereafter, the complainant has also lodged complaint before the Konanakunte police which was registered in Crime.No.133/2017. But the accused has not paid the cheques amount. Hence the complainant has constrained to file the present complaint.
4. After receiving the complaint, this court has meticulously gone through the documents and affidavit filed along with it and then took cognizance of the offence punishable U/sec.138 of Negotiable Instruments Act and ordered for registration of the compliant as P.C.R.
5. Sworn statement of the complainant was recorded and marked 25 documents as Ex.P-1 to P-25. As there were sufficient materials to constitute the offence, this court has proceeded to pass an order for issuing process against the accused.
7 32833/2018
6. In pursuance of summons, accused has appeared through his counsel and got enlarged on bail. The substance of accusation is read over to the accused in the language known to him, for which he pleaded not guilty.
7. As per the direction of Hon'ble supreme court in "Indian Bank Association V/s Union of India and others reported in (2014)(5) SCC 590, this court treated the sworn statement of the complainant as complainant evidence and posted matter for cross-examination of PW.1. Complainant examined one supporting witness i.e. PW.2. The counsel for the accused has cross-examined PW.1 and PW.2.
8. The statement of accused as contemplated under the provisions of Section 313 of Cr.P.C has been recorded vide order dated 20.01.2023 and the incriminating evidence as such forthcoming against the accused in the evidence of PW.1 and the documents has been read over 8 32833/2018 and explained to the accused in the language known to him. He denied all incriminating evidence.
9. The accused got examined as DW.1 and got marked Ex.D1 to D10. But he has not tendered for cross examination.
10. I have heard the arguments of the learned counsel for complainant. Learned Counsel for accused has not addressed the arguments on merits. I have perused the oral and the documentary evidence placed on record.
11. Points that arise for my consideration are as under:
1. Whether the complainant proves that the accused towards discharge of his liability issued 2 cheques bearing Nos.779308 and 779312 dated 06.01.2017 for Rs.10,00,000/-
each, drawn on State Bank of Mysore, Sarakki Branch, Bangalore in favour of complainant, on presentation of the same 9 32833/2018 for encashment, they were dishonored for "Funds Insufficient" in the account maintained by the accused, then in-spite of issuing demand notice to the Accused and in complying with statutory requirement under Negotiable Instrument Act, Accused did not repay the cheques amount, thereby he has committed an offence punishable U/s 138 of Negotiable Instruments Act?
2. What Order?
12. My Answer to above points are as under:-
Point No.I :- In the Affirmative,
Point No.II :- As per the final order for
the following....
REASONS
13. POINT NO.I:- In nutshell the case of the complainant is that he has lent loan of Rs.28,00,000/- to the accused by way of cash on 09.09.2015 and subsequently given Rs 20,00,000/- to and accused has issued the cheques in question in discharge of part the 10 32833/2018 said liability and when they were was presented to the bank, they got dishonoured for the reason 'Funds Insufficient'. The complainant has given legal notice as stipulated under NI Act and same is deemed to be served. But, the accused has not repaid the amount. Hence the present complaint.
14. Defense of the accused is as follows:
He was working as a priest in Shanimahathma Temple near Banashankari. Said temple is owned by one Mr.Jayannagowda. In 2016 he has lost his cheque and other documents. After lapse of 15 days, from the date of loosing those cheque and documents, one Mr.Chandrashekar Shetty called him and demanded Rs.30 lakhs to give back those documents. Mr.Chandrashekar Shetty has threatened that he should leave the job of priest in the temple stating that he intends to appoint another person in his place. Further accused contends 11 32833/2018 that that time he went to Kumara Swamy layout police station to give the complaint, but they have denied to take complaint. As such he filed private complaint before 44th ACJM Court, Bengaluru about loosing his 6 to 7 cheques and other documents. Among those lost cheques, the disputed cheque also included. Based on the said complaint, FIR was registered and same is produced here. Thereafter, complainant has filed this false case stating that he has given Rs.28 lakhs to him and also given false evidence in this case. The complainant has also filed another case in CC.No.32833/2018 against him before 30th ACJM Court. Hence prays to acquit him from this case.
15. To substantiate his case, the complainant has stepped into witness box and got examined as PW.1. He has got marked Ex.P-1 to P-25. He has produced the cheques issued by accused and the same is marked as Ex.P-1 & P-2, the signatures of the accused is marked as 12 32833/2018 Ex.P-1(a) & 2(a), copy of bank memos are marked as Ex.P- 3 & P-4, copy of demand notice dated:08.03.2017 is marked as Ex.P-5, copies of postal receipts are marked as Ex.P-6 to P-9, copies of returned notices are marked as Ex.P-10 to P-13, postal covers are marked as Ex.P-14 to P- 17, copies of postal receipts are marked as Ex.P-18 to P- 21, copies of postal acknowledgments are marked as Ex.P- 22 to P-24, complaint is marked as Ex.P-25.
16. Negotiable Instruments Act provides for some presumption in favour of the complainant i.e., Section 118 reads as here: - "That every negotiable instrument was made or drawn for consideration and that every such instrument when it has been accepted, endorsed, negotiated or transferred was accepted, endorsed, negotiated or transferred for consideration". 13 32833/2018
17. Further Sec 139 of the Negotiable Instruments Act provides for presumption in favour of a holder. It reads as here: - "It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in sec 138, for the discharge, in whole or in part, or any debt or other liability."
18. Combined reading of above said sections raises a presumption in favour of the holder of the cheque that he has received the same for discharge in whole or in part of any debt or other liability. However, it is settled principle of law that the presumption available u/s 139 NI Act can be rebutted by the accused by raising a probable defense.
19. The complainant has been stepped into witness box and got examined as PW.1 and he has reiterated the contents of the complaint in his chief-examination. During 14 32833/2018 cross-examination by the counsel for the accused he has deposed that he was working in Mangaluru Chemicals and got retired. He admits that accused has filed PCR No.1705/2017 against him based on which FIR in Cr.No.59/2017 has been registered. He deposed that police have filed 'B' report against the said complaint. He denied the suggestion of the counsel for the accused that he threatened the accused that he had found his documents near the temple and demanded money to return them. He denied that time the accused has given a private complaint to the Court. He denied that the accused has also given a police complaint before the Commissioner. He denied that after the accused lodged a private complaint, he has presented the disputed cheque which was one among the lost cheques of the accused.
20. He deposed that he met the accused in Shanimathma Temple where he was priest. He deposed 15 32833/2018 that he knows the trustee of the temple Mr.Jayanna and through him he met the accused. He denied that Mr.Jayanna intended to remove the accused from the priest post of the temple. He denied the suggestion that he knew, there was a internal dispute between the accused and Mr.Jayanna. He denied that he conspired with Mr.Jayanna to remove the accused from the priest post. He denied that himself and Mr.Jayanna called to accused and threatened that they got documents of the accused and he has to leave the job of the priest, to return them. He denied the suggestion that accused requested them to allow him to continue as the priest in the temple. Since accused denied for the leaving job, he has filed false case against the accused. He denied that he has also filed CC.No.32833/2018 against the accused wherein 2 cheques are produced.
16 32833/2018
21. PW1 admits the suggestion that he has also given a complaint against the accused in Konankunte police station on 26.03.2017 and the said case is pending before II ACMM Court. He denied the suggestion that he has given false complaint against the accused by joining his hands with Mr.Jayanna and ACP Manjunath Choudary before Subramanyapura police station on 13.03.2017. He denied that the police have illegally kept the accused in their custody based on the said complaint. He denied the suggestion that in the police station they have threatened the accused to give Rs.30 lakhs. He denied the suggestion that the accused has given a complaint on 15.03.2017 before the Police Commissioner for kidnapping him. He voluntarily deposed that it's a preplanned cheating.
22. He deposed that he has not taken any documents from the accused regarding purchasing of property by the accused for Rs.1,20,00,000/-. He deposed 17 32833/2018 that he has mortgaged his property before Thyagaraja Co-operative Bank and taken loan and same was given to the accused. He also enquired that family members of the accused regarding purchasing of property by the accused. The accused has taken him along with his parents and shown the said intended property to be purchased. He deposed that while he was giving money, to accused, Mr.Jayanna and his son Mr.Sandeep and friends were present. He deposed that he has given Rs.28 lakhs at a time to the accused. He denied that accused has not borrowed it. He deposed that on 09.09.2015 he got Rs.34 lakhs to his account and same was given to the accused. The accused has given cheque, on demand promissory note and cash receipt to him.
23. He admits that as per his account statement on 09.09.2015 one Mr.Somashekar has received Rs.14 lakhs and Mr.Manjunath has received Rs.20 lakhs. He admits 18 32833/2018 that on 11.09.2015 he has drawn Rs.4,65,000/- from his account. He deposed that by withdrawing the amount through Mr.Somashekar and Mr.Manjunath, said money was given to the accused. He deposed that he cannot examine Mr.Somashekar and Mr.Manjunath before the Court. He deposed that he has given notice to the accused as per Ex.P3. He denied the suggestion that notice is not served to the accused. He deposed that he has given notice to the accused to his 4 addresses of Yellapura and Bengaluru. He admits that those notices are returned as 'addressee not found'. He deposed that accused has purchased a house for Rs.1,20,00,000/- near Konanakunte Cross, near Soudamini Choultry. He admits the the copy of the complaint given by him on 26.03.2017 and it is marked as Ex.D1. He deposed that Mr.Jayanna has written the cheque and promissory note given by the accused. He denied that the signature shown in Ex.P1 cheque and 19 32833/2018 Ex.P24 promissory note are not made by the accused. He deposed that he has not declared about amount given to the accused in his income tax returns. He denied that he has filed false case against the accused by misusing his lost documents by joining his hands with temple trustee Mr.Jayanna. The remaining suggestions of the counsel for the accused has denied by him.
24. The complainant has examined one witness i.e. Mr.Jayanna as PW.2 and in his chief-examination he has deposed that in his presence the complainant has given Rs.28 lakhs to the accused by way of cash by mortgaging his property in Thyagarajanagar co-operative bank. He deposed that in his presence the accused has signed to promissory note and given infavour of the complainant. He deposed that in his presence the accused has issued the disputed cheque for repayment of Rs.28 lakhs. He deposed that thereafter again the accused has requested 20 32833/2018 for Rs.20 lakhs to the complainant, that time the complainant has arranged a sum of Rs.10 lakhs and given to the accused on 16.11.2016 in his presence. Since the complainant was short of Rs.10 lakhs, himself and his family have arranged said Rs.10 lakhs and it was given to the accused, by the complainant on 30.11.2016. That time accused has issued 2 more cheques bearing No.779308 and 779312 dated 06.01.2017.
25. During cross-examination by the counsel for the accused, PW2 deposed that he has not given any money to the complainant. He admits that he has given evidence against the accused in CC.No.9794/2018. He deposed that he has not stated in his chief-examination that he had given Rs.10 lakhs to the complainant. He deposed that the accused was priest in his temple and he was giving Rs.4,500/- per week to him and remaining amount received in the pooja thatte(plate) was keeping by 21 32833/2018 accused. Likewise accused worked for about 10 to 12 years as a priest in the temple. He denied the suggestion that as the accused was not giving the said income, he received by pooja, there was dispute arose between himself and the accused. He denied the suggestion that he was forcing the accused to give more than a sum of Rs.4,500/- and was also forcing the accused to leave the job.
26. He denied the suggestion that the complainant had asked him to appoint a person from his side for the priest's post, and at that time, he had conspired with the complainant to remove the accused from the said job. He denied the suggestion that on 06.12.2016 the complainant to called the accused through phone and threatened to give Rs.30 lakhs, otherwise he will not return the agreement papers, blank cheques and other documents which he found. He denied the suggestion 22 32833/2018 that though there is no transaction with the complainant, he has filed false case against the accused.
27. He deposed that he has helped the complainant to get the loan of Rs.30 lakhs form the co-operative society. He deposed that in his presence the complainant has given Rs.28 lakhs to the accused. The remaining suggestions of the counsel for the accused are denied by him.
28. Percontra, the accused stepped into witness box and got examined as DW.1 and he has deposed that he was working as a priest in Shanimahathma Temple near Banashankari. Said temple is owned by Mr.Jayannagowda. In 2016 he has lost his cheque and other documents. After lapse of 15 days from the date of loosing those cheque and documents one Mr.Chandrashekar Shetty called him and demanded Rs.30 lakhs to give back those documents. Mr.Chandrashekar Shetty has threatened him that he 23 32833/2018 shall leave the job of priest in the temple and he recommends some other person to the said job. That time he went to Kumara Swamy police station to give the complaint, but they have denied to take complaint. As such he filed private complaint before 44th ACJM Court, Bengaluru about loosing his 6 to 7 cheques and other documents. Among those lost cheques, the disputed cheque also included. Based on the said complaint, FIR was registered and same is produced here. Thereafter, complainant has filed this false case stating that he has given Rs.20 lakhs to him and also given false evidence in this case. The complainant has also filed another case in CC.No.32832/2018 against him before 30th ACJM Court. Hence he prays to acquit him.
29. But the accused has not tendered for cross examination.
24 32833/2018
30. I have meticulously gone through the pleading and evidence placed on record. The complainant has pleaded and deposed in his evidence that he has given Rs.28 lakhs to the accused on 09.09.2015, and he paid Rs 10,00,000/- each on 16/11/2016 and 30/11/2016. In discharge of the said loan, the accused has issued the cheques. Admittedly, the complainant has filed 2 cases against the accused i.e. CC.No.32782/2018 for Rs.28 lakhs and CC.No.32833/2018 for Rs.20 lakhs, before this court. Though both cases are filed pertaining to the same transaction based on 3 cheques issued by the accused for repayment of Rs.48 lakhs, 2 cases are filed.
31. In both the cases, cross examination of PW1 was conducted on similar lines. In CC.No.32782/2018 the accused has partly tendered for cross-examination, but in CC.No.32833/2018 the accused has not at all tendered for cross-examination. Both cases are taken up together for 25 32833/2018 adjudication on merits. With these backdrop lets proceed to appreciate the evidence.
32. Ex.P1 and 2 cheques stands in the name of accused. Accused admits that the cheques belong to his account, but he has disputed his signature at the cheques. It is pertinent to note here that as per bank memo at Ex.P3 and 4, the cheques has been dishonoured for the reason 'funds insufficient' and not for the reason 'drawer signature differs'. Therefore, this Court has to consider that since the signature on cheques at Ex.P1 and 2 have been tallied with the specimen signature, the bank has passed the cheques and given memo as per Ex.P3 and 4. Further, upon comparison of the accused's signature on Ex.P1 and 2 cheques with his vakalatnama and evidence, it appears that there is no discrepancy between the signatures. The accused has not tendered for cross- 26 32833/2018 examination and not made any effort to prove that the cheques were not signed by him. Mere denial of his signature on the cheques is insufficient to establish that the cheques were not signed by him. He has neither summoned the bank manager nor produced his specimen signatures given before the bank or appointed an expert to tally the signature on the cheques and his admitted signatures. In the absence of such evidence, the Court has to believe that the cheques have been signed by the accused. Hence it is proved that the cheques belong to the account of the accused and they bear his signature.
33. The Honorable Supreme Court of India in "Triyambak S Hegde v Sripad" (2022) 1 SCC 742 while relying upon the the constitution bench judgment of Basalingappa v Mudibasappa (2019) 5 SCC 418, under para 14 of its judgment reiterated that 27 32833/2018 "once the cheque was issued and that the signatures are upon the cheque are accepted by the accused, the presumptions undee Sec 118 and 139 of the NI Act arise against the accused. That is, unless the contrary is proved, it shall be presumed that the cheques in question were drawn by the accused for a consideration and that the complainant had received the cheque in question in discharge of debt/liability from the accused."
34. Therefore, as per Sec.118 and 139 of NI Act initial presumption has to drawn infavour of the complainant that cheques were issued in discharge of legally enforceable debt. The burden lies on the accused to rebut the said initial presumption on the scale of preponderance of probabilities.
35. To rebut the said presumption the accused has cross-examined PW.1 at length on different dates and taken various contentions. First and foremost defense of the accused is that he has lost his cheques and other 28 32833/2018 documents in December 2016 and that lost cheques have been misused by the complainant and false case is filed.
36. In his chief examination, the accused deposed that he lost his cheques and documents in December 2016. Approximately 15 days after losing the cheques, he received a phone call from Mr. Chandrashekar Shetty, the complainant, who informed him that he got the documents and he has also demanded Rs.30 lakhs to the accused. The accused has given a private complaint before 44th ACJM Court, Bengaluru regarding loosing his cheques and documents and for alleged demand made by the complainant for Rs.30 lakhs on 01.02.2017 as per Ex.D2.
37. The accused contends that on the same day, when he got a call from the complainant, he had tried to give the complaint to Kumara Swamy layout police station, but they have not received the complaint. It is 29 32833/2018 significant to note here that the accused knows the complainant, as the complainant used to visit Mr. Jayanna's house and the accused had seen him there. He further deposed that the person who called him, issued threats, and demanded Rs. 30 lakhs in exchange for returning his lost documents was none other than the complainant. When such being the case, in normal circumstances, if any prudent person received such threatening calls for a huge amount of Rs.30 lakhs, he would definitely lodge a police complaint without making any delay. But in the present case the accused has not taken any such steps immediately after he receiving a call from the complainant as alleged. There is no proof to believe that he has tried to give complaint to the Kumara Swamy police station, but they have refused to take it. Police have no reason to refuse to receive his compliant. If jurisdictional police refused, then he ought to have 30 32833/2018 approached higher police officials to take immediate steps.
38. Even during cross-examination of PW.1 the counsel for the accused has suggested that after complainant has given a police complaint on 26.03.2017, the police have called the accused to the police station and kept him in illegal custody and same is denied by PW.1. It is also suggested that accused had given another police complaint on 15.03.2017 for kidnapping him before Commissioner office and same is denied by PW.1. But except making these suggestions about illegal custody or police complaint dated 15.03.2017, the accused has not produced any iota of evidence before the Court to prove the said facts.
39. The complainant has clearly pleaded and also deposed that the disputed cheques were given by the accused in December 2016 and asked to present it on 31 32833/2018 15.02.2017, he has presented it on 15.02.2017. Therefore, possibility of lodging the complaint as per Ex.D2 to evade the liability of the cheques given to the complainant cannot be brushed aside. The accused must provide an justifiable explanation for the delay in approaching the police, but same is missing in this case.
40. Further after filing this complaint as per Ex.D2 before the Magistrate Court, the matter was referred to the police for investigation as per the order dated 07.02.2017 as per Ex.D5. The police have filed 'B' report as per Ex.D7 on the ground that the "complainant has not co-operated for investigation and despite of asking him to present in the police station to give statement, he has not co-operated".
32 32833/2018
41. Therefore, if the police refused to register the complaint and the accused was compelled to file a private complaint before the Court, he ought to have appeared before the investigating officer to give his statement. Why he kept absent and not extended cooperation to IO is not forthcoming. The accused has also not challenged the 'B' report filed by the police and such conduct of the accused creates suspicion about the defense. Therefore, the first ground of attack of the accused that he has lost his cheques and later the complainant found them and misused at the instigation of Mr.Jayanna cannot be accepted.
42. Further accused contends that the complainant has told him that he should leave the job of priest in the temple so that he can join the person from his side to the said post. This statement of the accused shows that both Mr.Jayanna and complainant have colluded together to 33 32833/2018 remove him from the post of priest and hatched a plan. If that was the case, the accused ought to have given a complaint against Mr.Jayanna also for instigating the complainant for misusing his lost cheques. No such efforts forthcoming from the accused side.
43. Secondly, the complainant has given another complaint against the accused on 26.03.2017 as per Ex.D1 narrating the entire transaction based on which the police have also filed the charge sheet and the criminal case is pending for consideration. Said complaint is filed not only against the accused, but against the family members of accused also. Because as per PW1, father, brother-in- laws, and sisters of the accused have also assured to return the loan taken by the accused. If the accused had no transaction with the complainant, there was no motive for the complainant to file the case against the entire family members of the accused persons. When the gravity 34 32833/2018 of situation is so serious, why did the accused not taken steps against the complainant and why did he failed to challenge 'B' report filed on his compliant, itself is not understandable.
44. The counsel for the accused has much cross- examined PW.1 with regard to his source of income and about the loan transaction. PW.1 has pleaded and deposed that he had given Rs.28 lakhs by way of cash (at first instance as per CC.No.32782/2018) and Rs.20 lakhs (as CC.No.32833/2018.) He deposed that he had pledged his property and borrowed money to arrange money to the accused. To substantiate the same he has confronted the said mortgage deed to DW.1 in CC 32782/2018, but the accused has denied his signature on said mortgage deed. However copy of said mortgage deed is not produced in this case as cross examination of DW1 was not commenced in this case at that time. Subsequently 35 32833/2018 Dw1 not tendered for cross examination. The complainant has also produced his account statement as per Ex.D10 to prove his source of income. PW1 deposed that he has withdrawn Rs.14 lakhs and Rs.20 lakhs through one Mr.Somashekar and Mr.Manjunath on 09.09.2015 and said money was given to the accused. The counsel for the accused has argued those money were given to Mr.Somashekar and Mr.Manjunath and not to the accused and even asked whether complainant could examine these 2 persons before the Court and PW.1 has denied for the same.
45. It is material to note here that the complainant enjoys the initial presumption regarding passing of consideration to the accused U/Sec.118 of NI Act. Unless the accused rebuts it on the scale of preponderance of probabilities, the complainant need not prove his case further. By producing his account statement and 36 32833/2018 mortgage deed, the complainant has established that he could arrange Rs.34 lakhs. He has deposed that he had again given Rs.20 lakhs to accused, out of which Rs.10 lakhs was received by PW.2. However, in his cross- examination PW.2 has denied that he had given Rs.10 lakhs to the complainant. No doubt PW.2 has not supported the complainant about Rs.10 lakhs alleged to be taken from him by the complainant. But the remaining evidence of PW.2 cannot be ignored, wherein complainant had made efforts before the Court to prove that he had arranged money to give loan to the accused. Interestingly, PW.2 has supported the case of the complainant by telling that in his presence accused has received Rs.48 lakhs and for it's repayment the disputed cheques were issued by the accused.
46. In Ashok Singh V State of Uttar prasdesh and and another reported in 2025 Live law (SC)_ 383, Apex 37 32833/2018 court by relying on M/s S. S. Production v. Tr. Pavithran Prasanth, 2024 INSC 1059, held that "Pausing here, the Court would only comment that the reasoning of the High Court as well as the First Appellate Court and Trial Court on this issue is sound. Just by taking a counter-stand to raise a probable defence would not shift the onus on the complainant in such a case for the plea of defence has to be buttressed by evidence, either oral or documentary, which in th present cases, has not been done. Moreover, even if it is presumed that the complainant had not proved the source of the money given to the petitioners by way of loan by producing statement of accounts and/or Income Tax Returns, the same ipso facto, would not negate such claim for the reason that the cheques having being issued and signed by the petitioners has not been denied, and no evidence has been led to show that the respondent lacked capacity to provide the amount(s) in question."
47. Principles laid down in above case law aptly applicable to present case. Had the accused probablised, his defense in any manner known to law , then the onus 38 32833/2018 would have been shifted to the complainant to prove his case further and give explanation regarding inconsistency occurred in the evidence of PW.2 regarding source of money arranged to give loan to the accused to an extent of RS 10 lakhs.
48. AIR 2023 SC 5018 in between Rajesh Jain V/s Ajay Singh, Apex court held that "62. The fundamental error in the approach lies in the fact that the High Court has questioned the want of evidence on part of the complainant in order to support his allegation of having extended loan to the accused, when it ought to have instead concerned itself with the case set up by the accused and whether he had discharged his evidential burden by proving that there existed no debt/liability at the time of issuance of cheque.."
49. In the case of Rohitbhai Jivanlal Patel v. State of Gujarat reported in 2019 (5) SCALE 138, it is held that "even after purportedly drawing the presumption under Section 139 of the N.I. Act, the trial court 39 32833/2018 proceeded to question the want of evidence on the part of the complainant as regards the source of funds for advancing loan to the accused and want of examination of relevant witnesses who allegedly extended him money for advancing it to the accused. The Hon‟ble Supreme Court observed that this approach of the trial court had been at variance with the principles of presumption in law. After such presumption, the onus shifted to the accused and unless the accused had discharged the onus by bringing on record such facts and circumstances as to show the preponderance of probabilities tilting in his favour, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of funds for advancing loan to the accused."
50. Principles laid down in above case laws aptly applicable to present case. The accused has not discharged onus cast upon him. Indeed the accused has not tendered for cross-examination and his absence in the legal proceedings creates serious doubt about the defense and shaken the defense.
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51. No evidence brought on record to prove that there was enmity between himself and PW.2 Mr.Jayanna regarding post of priest of Shanimahatma Temple where the accused was working before filing this case. In conclusion, the circumstances clearly demonstrate that the accused had financial transactions with the complainant and voluntarily issued the cheques marked as Ex.P1 and 2. The defence put forth by the accused, alleging loss and misuse of his cheques, appears to be an afterthought and lacks credibility.
52. The complainant has given a legal notice as per Ex.P5 and it was returned as 'insufficient address', 'door lock' and 'left the address' as per Ex.P14 to P21 RPAD covers. The notices are given to the address of the accused of Yellapura as well as to the Bengaluru address. Except mere denial of the service of notice, the accused has not proved anything contrary to hold that the notices 41 32833/2018 are not served upon him. It is well settled law that if the notices are given to the last known correct address through RPAD, irrespective of the shara, as per Sec.27 of General Clauses Act notices are deemed to be served.
53. K. Bhaskaran vs Sankaran Vaidhyan Balan And Anr reported in AIR 1999 SUPREME COURT 3762, Apex court held that "No doubt Sec 138 of the Act does not require that the notice should be given only by `post'. Nonetheless the principle incorporated in Sec 27 (quoted above) can profitably be imported in a case where the sender has despatched the notice by post with the correct address written on it. Then it can be deemed to have been served on the sendee unless he proves that it was not really served and that he was not responsible for such non-service. Any other interpretation can lead to a very tenuous position as the drawer of the cheque who is liable to pay the amount would resort to the strategy of subterfuge by successfully avoiding the notice. "
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54. In C.C. Alavi Haji vs Palapetty Muhammed & Anr (2007) 6 SCC 555, the Hon'ble Apex court has held;
"17. It is also to be borne in mind that the requirement of giving of notice is a clear departure from the rule of Criminal Law, where there is no stipulation of giving of a notice before filing a complaint. Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under Sec 138 the Act, make payment of the cheque amount and submit to the Court that he had made payment within 15 days of receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the Court along with the copy of the complaint under Sec 138 of the Act, cannot obviously contend that there was no proper service of notice as under
Sec 138 , by ignoring statutory presumption to the contrary under Sec 27 of the G.C. Act and Sec 114 of the Evidence Act. In our view, any other interpretation of the proviso would defeat the very object of the legislation... " 43 32833/2018
55. Therefore, as accused did not pay cheque amount within 15 days of receipt of the summons from the Court, defense of the accused that notice is not served holds no water. Not responding to notice by way of giving reply is also fatal to the defence.
56. If at all, the jurisdictional police have refused to take his complaint soon after receiving threatening call rom PW1 and PW2, then nothing prevented him to give 'stop payment instructions' to his banker to prevent his cheques being misused. No such efforts is also made by the accused. Neither he has taken immediate action against the complainant for misusing of his document and giving threatening call nor he challenged 'B' report filed by the police based on the subsequent complaint lodged him after much delay. Except formal denying of his signature on the disputed cheques, promissory note, mortgage deed, he has failed to prove that those 44 32833/2018 signatures are not made by him, in accordance with law by examining the bank manager or sending those documents to the FSL etc.
57. His conduct place a very important role in this case. He has not tendered for cross-examination to the complainant side. He is absent before the Court frequently. He has also not challenged the decree passed infavour of the complainant pertaining to same transaction. During arguments the counsel for the complainant has also submitted to the Court to avoid recovery of money in the execution petition, accused has sold his property during pendency of the execution petition. Counsel for the accused has not addressed the arguments on merits.
58. Therefore, having scrutinized the entire evidence placed on record this Court is of the view that accused has failed to rebut the initial presumption drawn 45 32833/2018 in favour of the complainant. The complainant has successfully proved his case. Accordingly court proceed to answer POINT NO.I IN THE AFFIRMATIVE.
59. POINT NO.II:- In view of the reasons assigned in above point, it is ample clear that accused has committed the offence punishable u/s 138 of the Act. No offence made against the accused. A bare reading of sec.138 of the NI Act indicates that the purport of sec.138 is to prevent and punish the dishonest drawers of cheques who evade their liability.
60. The Hon'ble Apex Court in its recent decision in M/s. Meters & instrument Pvt Ltd. Vs. Kanchana Mehta reported in (2018)1 SCC-560 held at para 18(ii) that "(ii) The object of the provision being primarily compensatory, punitive element being mainly with the object of enforcing the compensatory element, 46 32833/2018 compounding at the initial stage has to be encouraged but is not debarred at later stage subject to appropriate compensation as may be found." In view of the reasons assigned in above point, it is ample clear that accused has committed the offence punishable u/s 138 of the Act.
61. In R. Vijayan vs. Baby and Another reported in AIR 2012 SUPREME COURT 528, Apex court held that 'that unless there were special circumstances, in all cases of conviction, the Court should uniformly exercise the power to levy fine up to twice the cheque amount and keeping in view the cheque amount and the simple interest thereon at 9% per annum as the reasonable quantum of loss, direct payment of such amount as compensation. This Court rightly observed that uniformity and consistency in deciding similar cases by different courts not only increases the credibility of the cheque as a Negotiable Instrument but also the credibility of the Courts of Justice'.
62. Therefore, having regard to the time from which amount is lying with the accused and keeping in mind the 47 32833/2018 primary object of the provision, fence taken by the accused and his subsequent conduct of keeping absent before court, this court is of the opinion that, rather than imposing punitive sentence, if sentence of fine of Rs.30,00,000/- is imposed with a direction to compensate the complainant for his monitory loss, by awarding compensation U/Sec.357 of Cr.P.C, would meet the ends of justice. Accordingly, this court proceeds to pass following .....
ORDER The accused is found guilty for the offence punishable U/s.138 of Negotiable Instruments Act.
Hence, acting U/sec.255(2) of Cr.P.C, the accused is convicted and sentenced to pay a fine of Rs.30,00,000/- (Rupees Thirty Lakhs Only), in default of fine amount, accused shall undergo 48 32833/2018 simple imprisonment for 2 years for the offence punishable under section 138 of N.I.Act.
Out of the fine amount collected from the accused, an amount of Rs.29,90,000/- (Rupees Twenty Nine Lakhs Ninety Thousand only) shall be paid to the complainant as compensation U/s.357 of Cr.P.C. and the remaining fine of Rs.10,000/- shall be adjusted towards the cost of state expenses.
The bail bonds of the accused shall be in force till the appeal period is over as contemplated under the provisions of Sec.437(A) of Cr.P.C.
Office to supply the copy of the Judgment to the accused forthwith at free of cost.
(Dictated to the Stenographer, typed by her, corrected by me and then judgment pronounced in the open court on this the 23 rd day of October 2025).
(Smt.Tejaswini K.M), XVI ACJM, Bengaluru 49 32833/2018 ANNEXURE I. List of witnesses on behalf of complainant:
P.W.1: Sri.C.B.Chandrashekar Setty P.W.2: Sri. Jayanna II. List of documents on behalf of complainant:
Ex.P-1 & 2 : Original Cheque. Ex.P-1(a) & 2(a) : Signatures of the accused Ex.P-3 & 4 : Bank memos.
Ex.P-5 : Copy of Legal notice. Ex.P-6 to 9 : Postal Receipts. Ex.P-10 to 13 : Returned Notices. Ex.P-14 to 17 : Postal Covers. Ex.P-18 to 21 : Postal Receipts. Ex.P-22 to 24 : Postal Acknowledgments. Ex.P-25 : Complaint.
III. List of witnesses for the accused:
D.W.1: Sri.Manjunath Bhagwath IV. List of documents for accused:
Ex.D-1 : Complaint before Konanakunte police. Ex.D-2 : C/c of complaint in PCR No.1705/2017 50 32833/2018 Ex.D-3 : C/c of FIR in Cr. No.59/2017. Ex.D-4 : Complaint before Konanakunte police. Ex.D-5 : C/c of Order Sheet in PCR No.1705/2017. Ex.D- 6 : C/c of Complaint in PCR No.1705/2017. Ex.P-7 : Charge Sheet in Cr.No.59/2017. Ex.D-8 : FIR in Cr.No.133/2017. Ex.D- 9 : Complaint before Konanakunte police. Ex.D-10 : Bank Statement.
(Smt.Tejaswini K.M ), XVI ACJM, Bengaluru 51 32833/2018 23.10.2025 (Judgment pronounced in the open Court vide separate) ORDER The accused is found guilty for the offence punishable U/s.138 of Negotiable Instruments Act.
Hence, acting U/sec.255(2) of Cr.P.C, the accused is convicted and sentenced to pay a fine 52 32833/2018 of Rs.30,00,000/- (Rupees Thirty Lakhs Only), in default of fine amount, accused shall undergo simple imprisonment for 2 years for the offence punishable under section 138 of N.I.Act.
Out of the fine amount collected from the accused, an amount of Rs.29,90,000/- (Rupees Twenty Nine Lakhs Ninety Thousand only) shall be paid to the complainant as compensation U/s.357 of Cr.P.C. and the remaining fine of Rs.10,000/- shall be adjusted towards the cost of state expenses.
The bail bonds of the accused shall be in force till the appeal period is over as contemplated under the provisions of Sec.437(A) of Cr.P.C.
Office to supply the copy of the Judgment to the accused forthwith at free of cost.
XVI ACJM, Bengaluru 53 32833/2018