Karnataka High Court
Arun Pandurang Naik vs Gopal Sidram Shet on 14 July, 2020
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IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
DATED THIS THE 14TH DAY OF JULY 2020
BEFORE
THE HON'BLE MRS.JUSTICE M.G.UMA
CRIMINAL APPEAL NO.2669/2011
BETWEEN
ARUN PANDURANG NAIK,
AGE: 39 YEARS, R/O: NAVILGONE,
HONNAVAR TALUK,
DISTRICT: UTTARA KANNADA.
......... APPELLANT
(BY SRI.J.S.SHETTY, ADVOCATE)
AND
GOPAL SIDRAM SHET,
AGE: MAJOR, R/O: NAVILGONE,
HONAVAR TALUK,
DISTRICT: NORTH KANARA.
.....RESPONDENT
(BY SRI.SABEEL AHMED, ADVOCATE FOR
SRI.A.S.PATIL, ADVOCATE)
THIS CRIMINAL APPEAL IS FILED UNDER
SECTION 378 OF CR.P.C. SEEKING TO SET ASIDE
THE ORDER OF ACQUITTAL DATED 24.01.2011
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PASSED BY THE PRINCIPAL, JMFC, HONAVAR IN
C.C.NO.794/2006, FOR THE OFFENCE PUNISHABLE
UNDER SECTION 138 OF THE N.I.ACT.
RESERVED FOR JUDGMENT ON: 10/07/2020
JUDGMENT PRONOUNCED ON : 14/07/2020
THIS APPEAL HAVING BEEN HEARD AND
RESERVED FOR JUDGMENT, COMING ON FOR
PRONOUNCEMENT OF JUDGMENT ON THIS DAY,
M.G.UMA,J., DELIVERED THE FOLLOWING:
JUDGMENT
The complainant as appellant is before this Court aggrieved by the impugned judgment of acquittal dated 24/1/2011 passed by the learned Prl.JMFC, Honavar, (for short "trial Court") in CC No.794/2006 where under the respondent accused was acquitted for the offence punishable under Section 138 of N.I.Act. -3-
2. Heard the learned advocates Sri. J.S.Shetty for the appellant and Sri. Sabeel Ahmed for respondent.
3. Parties are referred to as per their rank assigned to them before the trial Court.
4. Brief facts of the case are that the appellant herein as complainant filed the private complaint in PC No.159/2006 against the respondent herein as accused before the trial Court for the offence punishable under Section 138 of N.I.Act.
5. It is contention of the complainant before trial Court that accused and himself were good friends and accused had borrowed a hand loan of Rs.2,00,000/- for the purpose of purchasing the agricultural land agreeing to repay the same within six months. But the -4- accused has not repaid the loan amount inspite of repeated demands. Finally, the accused issued the cheque bearing No.201782 dated 31/5/2006 drawn on Karnataka Bank Ltd., Navilgon Branch, and requested the complainant to present the same for encashment. Accordingly, the complainant presented the cheque for encashment with his banker. But the cheque in question was dishonoured as there was insufficient funds in the account of the drawer-accused. The dishonour of the cheque was communicated to the complainant by the Karnataka Bank Navilgon branch vide its memorandum dated 18/8/2006. The complainant got issued the legal notice dated 22/8/2006 to the accused informing him regarding the dishonour of the cheque and calling upon him to repay the -5- amount. The said notice was served on the accused as per the postal acknowledgement, but accused has not replied to the notice nor complied with the demands made therein, thereby the accused has committed the offence punishable under Section 138 of the N.I.Act. Therefore, the complainant requested the trial Court to take cognizance of the matter and to initiate legal action against the accused.
6. The trial Court after recording the sworn statement of the complainant and after considering the documents produced by him took cognizance of the matter and summoned the accused to appear before the Court. The accused appeared before the trial Court represented by the advocate, but pleaded not guilt for the offence punishable under Section -6- 138 of the N.I. Act. He claims to be tried. Thereafter, the complainant examined himself as DW-1 and got marked Exs.P1 to 5 in support of his contention. The accused was examined under Section 313 of Cr.P.C. and he denied all the incriminated materials available on record. Accused got examined DWs.1 and 2 and himself as DW-3 and got marked Exs.D1 to D8 in support of his defence.
7. The trial Court after taking into consideration all these materials on record, came to the conclusion that the complainant has failed to prove the existence of legally recoverably debts and consequently, failed to prove the guilt of the accused for the offence punishable under Section 138 of N.I.Act beyond -7- reasonable doubt vide its judgment dated referred to above.
8. Aggrieved by the said impugned judgment of acquittal referred to above, the complainant has preferred this appeal on various grounds. The learned Advocate for the appellant submitted that the accused had borrowed hand loan of Rs.2,00,000/- for the purpose of purchasing the agricultural land agreeing to repay the same within six months. In discharge of the said hand loan, the accused issued the cheque in question for Rs.2,00,000/-. But when the cheque was presented for encashment, the same was dishonoured with the endorsement that there was insufficient funds in the account of account. Inspite of receipt of the legal notice, the accused has neither replied nor -8- complied with the demand made therein. Thereby he has committed the offence punishable under Section 138 of the N.I.Act. In support of that contention, the complainant got examined himself as PW-1 and got marked the relevant document as per Exs.P1 to 5. During cross examination of PW-1, it is elicited from the complainant, that he is an agriculturalist and also a contractor by profession. He stated that he is owning 18 guntas of garden land. It is also elicited from PW-1 that the loan in question was paid to the accused during September 2005. Since the hand loan was paid in cash there are no witnesses to the said transaction. During cross examination, two cheques as per Ex.D1 and 2 were tendered to this witness and the same were admitted by the complainant. Nothing has been elicited from the complainant -9- during cross examination. But it is pertinent to note that the accused has not denied the execution of the cheque Ex.P1 nor he denied borrowal of any amount from the complainant. He further submitted that when the accused stepped into the witness box as DW-3, he specifically admitted borrowal of the amount from the complainant, but however, he contended that he had borrowed only four to five thousand about 3 to 4 years back. Therefore, it is clear that the accused has not denied borrowal of the amount and issuance of the cheque Ex.P1 towards repayment of the said cheque. But however, the defence taken by the accused was never probabalised. The evidence of DWs-1 and 2 is not at all helpful to the accused to prove his defence. Exs.D1 to 5 are not at all helpful to the accused either to prove
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his contention or to disprove the contention of the complainant. Exs.D6 to 8 were marked subject to objection and these documents do not contain the signature of PW-1. He submitted that Exs.P6 to P8 was never tendered to the complainant while he was in the witness box as PW-1.
9. He further submitted that when the cheque in question was admittedly executed by the accused and when the accused admits the signature found on the cheque in question, the presumption under Section 139 of N.I.Act comes into operation and therefore, it is for the accused to rebut the presumption by placing probable defence. In the present case, the accused has not taken specific defence nor probabalised the same. The defence taken by
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the accused itself contradictory and under such circumstances, it can be said that he has probabalised his defence. Therefore, it is his submission that the trial Court has committed an error in relying on the evidence of the accused and in acquitting him for the offence punishable under Section 138 of N.I.Act. He prays for interference by this Court in the impugned judgment of acquittal by allowing the appeal and by convicting the accused for the offence in question.
10. Per contra, the learned Advocate for the respondent supported the reasoning given by the trial Court in the impugned judgment for acquitting the accused. He submitted that the accused has not placed material to prove lending of huge amount of
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Rs.2,00,000/- to the accused. Even the date of lending is not mentioned in the complaint. Unless the complainant proves lending of the amount, it cannot be said that he has proved the guilt of the accused. Admittedly, the complainant is an agriculturist owning only 18 guntas of garden land and it is highly improbable to believe that he had sufficient financial capacity to lend huge amount of Rs.2,00,000/- during 2005-06. Taking into consideration all these facts and circumstances and also relied on the evidence of DWs-1 to 3 and Exs.D1 to 8, the trial Court came to the conclusion that the lending of the amount itself is not proved. The learned Advocate relied on the decision in Krishna Janardhana Bhat Vs. Dattaraya J.Hegde 1, to contend that the 1 2008 (4) SCC 54
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presumption under Section 139 of N.I.Act do not cover the existence of legally recoverably debt. Therefore, it is submitted that the impugned judgment of acquittal passed by the trial Court do not suffer from any legality and the appeal preferred by the complainant is devoid of merits. Hence, he prayed for dismissal of the appeal in the interest of justice.
11. In the light of the submission by both the learned Advocates representing the parties, I have gone through the materials placed before the Court including the TCR.
12. In support of the contention of the complainant that he had lend an amount of Rs.2,00,000/- to the accused. He examined himself as PW-1 and reiterated his contention as taken in the complaint. During cross
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examination, it is elicited from the witnesses that he is also doing contract work at Gram Panchayat level and also owns 18 guntas of agricultural land. Further, he is having income of Rs.35,000/- to Rs.40,000/- per year from agriculture. It is also elicited that the loan in question was paid in cash to the accused during September 2005. The witness specially stated that Ex.P1 was signed and given by the accused, in discharge of the debt which was due. Witness stated that he has not noted either lending of the amount or repayment of the loan amount by the accused in any diary. He denied the suggestion that he is doing money lending business and misused the cheque with the signature of the accused by presenting the same by filling the amount with imaginary figure. He denied the suggestion that the contents of Ex.P1
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was got written by Sri.M.L.Naik Advocate who is his cousin. Ex.P1 is the cheque dated 31/5/2006 drawn for Rs.2,00,000/- on Karnataka Bank, Navilgon Branch with the signature of the accused. The signature found on this document is identified by the complainant as Ex.P1(a). Ex.P2 is the endorsement dated 18/8/2006 by Karnataka Bank, Navilgon Branch informing the complainant that the cheque in question was dishonoured as 'funds insufficient' in the account of the accused. Ex.P3 is the office copy of the legal notice dated 22/8/2006 got issued by the complainant to the accused informing about dishonour of the cheque and calling upon him to repay the cheque amount. Ex.P4 is the postal receipt, Ex.P5 is the postal
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acknowledgement for having served the notice on the accused.
13. Per contra, the accused got examined DW-1- Sri.Manjunath Naik. Witness stated that he is an advocate practicing since 16 years and representing the complainant before the trial Court. He stated that he had written the contents of Ex.P1 as per the direction of the accused. He stated that Exs.D1 and D2 are also in his hand writing which were written as per the instruction given by the accused in C.C.815/2016 and PC No.153/2006. This witness was treated hostile by the learned Advocate for the accused and during cross examination, witness denied the suggestion that he had written Ex.P1, as per the say of the complainant. Similarly, he also denied the
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suggestion that Exs.D1 and D2 are also written by him as per the directions of the complainant. Witness stated that both complainant and accused are familiar to him and they belong to the same village. Witness stated that when he was about to issue legal notice to the accused for repayment of the loan amount, the accused came with the cheque-Ex.P1 and gave instruction to write the same and issued it in favour of the complainant. He denied the suggestion that since he is the cousin of the complainant, he is deposing falsely against the accused.
14. DW-2 is Sripathi Bhat - the Manager of Karnataka Bank, Navilgon branch. This witness speaks about opening of the bank account by the accused in his bank on
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21/3/2006 and while opening the account, the accused was introduced to the bank by the complainant. He identified the proposal/ application form submitted by the accused as per Exs.D3 and D4.
15. DW-3 is the accused himself who deposed before the Court that he knows the complainant, but denied that he had borrowed loan of Rs.2,00,000/- from the complainant. He also stated that he never gave instruction to DW-1 to write cheque Ex.P1. Witnesses stated that the complainant had taken nine cheques with his signatures on it. He stated that he never purchased any agricultural land. Witness stated that 3 to 4 years back, he had borrowed an amount of Rs.4,000/- to 5,000/-from the complainant agreeing to repay the same with
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interest at 10% p.a. He produced three chits and stated that they are in the hand writing of the complainant. These documents were marked as Exs.D6 to D8 subject to the objection of the complainant. Witness stated that the complainant got his blank cheque with his signature and misused it. Therefore, he prays for dismissal of the complaint.
16. During cross examination by the learned Advocate for the complainant witness stated that he is a small scale business man and he knows reading and writing. Witness stated that while transacting he will be very careful and unless understands the transactions, he never involves himself in it. He stated that the complainant had taken in all ten cheques and his signatures were taken forcibly but he has
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not complained to the bank about such obtaining of the signatures forcibly, but he had lodged a police compliant with Honavar police. But however, in the complaint, he has not mentioned that the complainant had forcibly taken the cheques. Witness further stated that in the complaint, he had mentioned that he had already repaid the loan amount of Rs.10,000/-. He denied the suggestion that he had borrowed an amount of Rs.2,00,000/- and to repay the same, he had issued the cheque Ex.P1. Further, the accused pleaded his ignorance about the annual income of the complainant during 2005 and thereafter.
17. Exs.D1 and D2 are the copies of the cheques which were admitted by PW-1. Exs.D3 and D4 are the proposal and application
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form submitted by the accused for opening the bank account with Karnataka Bank, Navilgon branch. Ex.D5 is the record of rights standing in the name of Siddarama Govinda Shet, i.e. the father of the accused. Exs.D6 to D8 are the chits with few entries in it. Ex.D9 is the tax paid receipt. Ex.D10 is the endorsement given by the village accountant, Gram Panchayat, Navilgon. Ex.D11 is the work order issued by Navilgon Gram Panchayat. Ex.D12 is the application submitted to the Panchayat under Rajiv Gandhi Grameen Vasati Scheme, Ex.D13 is the income certificate relating to the accused issued by the village accountant stating that he is having annual income of Rs.11,000/-. Ex-D14 is the record of rights standing in the name of Ramesh Pandurang Naik.
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18. If the oral evidence of the parties are considered in the light of these documents relied on by them, it is clear that the accused has never denied execution of the cheque Ex.P1 in favour of the complainant. Of course he contends that blank cheque with his signature was obtained by the complainant according to him. He had lodged a complaint with Honavar police against the complainant for obtaining his signature forcibly on 10 cheque leaves. But the said complaint is not placed before the Court. The accused has not lodged any complaint with the bank nor given the stop payment instructions to the bank. Moreover, it is his defence that he had borrowed Rs.4,500/- to Rs.5,000/- from the complainant, but during his cross examination, he states that in the complaint lodged before the police, he mentioned
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the amount of the loan as Rs.10,000/-. Therefore, it is clear that the accused has not taken any specific defence in the matter. Even otherwise, when the accused admits the signature found on Ex.P1, the presumption under Section 139 of N.I.Act comes into operation.
19. Even though the learned Advocate for the accused placed his reliance on Krishna (supra), it is pertinent to note that the view point expressed by the Hon'ble Supreme Court in the said case to the extent that the presumption under Section 139 of N.I.Act, is only to the extent that the cheque has been issued for discharge of debt or other liability but existence of legally recoverable debt is not a matter of presumption under Section 139 of
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N.I.Act is over ruled. In Rangappa Vs. Sri. Mohan 2, the Hon'ble Supreme Court by overruling this view point held that the presumption under Section 139 of N.I.Act includes the presumption that there exists legally recoverably debts or liability. However, such presumption is rebuttal in nature. Therefore, once the execution of the cheque by the accused is proved by the complainant, the presumption under Section 139 of the N.I. Act arises and it is for the accused to rebut the same.
20. In the present case, during the cross examination of PW-1 nothing has been elicited to rebut the presumption. Even though DWs.1 and 2 are examined, their evidence is not helpful to rebut the presumption. On the other 2 2010 11 SCC 441
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hand, the evidence of DW-1 further strengthens the case of the complainant. Even though the accused stepped into the witness box as DW-3 and produces Exs.D6 to 8 same are not helpful to rebut the presumption. Exs.D6 to D8 are the loose chits with some writing on it, without having any signature nor any particulars written on it. These documents were never tendered to PW-1 while he was in the witness box. Nor it was suggested to the complainant that such an account was maintained by the accused. These documents were marked subject to objection as they were not admitted by the complainant, under such circumstances, these documents are not helpful to the accused to rebut the presumption. The other evidence, both oral and documentary are also not helpful for the accused to rebut the persimmon.
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21. One more circumstances, which is to be taken into consideration is that the complainant had issued the legal notice as per Ex.P3 and the same was served on the accused as per Ex.P5. This fact is admitted by the accused. But strangely the accused has not given any reply explaining that the complainant had taken the cheque in question forcibly and misused the same. Under such circumstances, it cannot be said that the accused has probabalised his defence. Even the written version given by the accused in his 313 statement do not depict his defence and is not helpful to rebut the presumption under Section 139 of the N.I.Act.
22. Unless the presumption under Section 139 of the N.I.Act is rebutted, it cannot
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be said that the accused is entitled for acquittal. On the other hand, it can be said that the complainant has proved the guilt of the accused for the offence punishable under Section 138 of N.I.Act against the accused beyond reasonable doubt and the accused is liable for conviction. Therefore, I am of the opinion that the complainant in the present case is successful in proving the guilt of the accused for the above said offence beyond reasonable doubt and therefore, the accused is liable for conviction.
23. I have gone through the impugned judgment of acquittal passed by the trial Court. It has relied on the decision in Krishna Janardhana Bhat (supra) and proceeded to acquit the accused. The view point expressed by the Hon'ble Supreme Court in the said decision
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to the effect that existence of legally recoverable debt is not a matter of presumption under Section 139 of N.I.Act is no more a good law in view of the verdict in Rangappa's case (supra). Therefore, I am of the opinion that the trial Court has committed an error in acquitting the accused for the above said offence. Hence, the impugned judgment of acquittal is liable to be set aside and the accused is liable to be convicted for the offence punishable under Section 138 of the N.I.Act. Hence, I proceed to pass the following:
ORDER Appeal is allowed.
The impugned judgment of acquittal passed by the Principal J.M.F.C. Honavar, in C.C.No.794/2006 dated 24/1/2011 is set aside. The accused Sri Gopal Sidram Shet is convicted
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for the offence punishable under Section 138 of N.I.Act and he is sentenced to undergo simple imprisonment for a period of one year and to pay fine of Rs.2,10,000/- and in default to pay fine to undergo further imprisonment for a period of two months. Out of the fine amount to be deposited by the accused, a sum of Rs.2,00,000/- is to be paid to the complainant as compensation under Section 357 of Cr.P.C. The trial Court is directed to secure the presence of the accused for issuance of conviction warrant for serving the sentence. Send back the trial Court records with copy of the judgment, SD/-
JUDGE Vmb