Karnataka High Court
Sri R Rajvi vs Sri R Venkatesh on 28 November, 2023
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CRL.A No. 733 of 2012
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 28TH DAY OF NOVEMBER, 2023
BEFORE
THE HON'BLE MR JUSTICE S RACHAIAH
CRIMINAL APPEAL NO. 733 OF 2012 (A)
BETWEEN:
SRI R RAJVI
S/O RATHNAM
AGED ABOUT 38 YEARS
NO. 312, 'IDA COTTAGA'
1ST CROSS, MATHIKERE
BANGALORE - 560 054.
...APPELLANT
(BY SRI. ROHIT URS D., ADVOCATE)
AND:
SRI R VENKATESH
S/O V RAMAKRISHNAPPA
AGED ABOUT 48 YEARS
R/O NO. 16, 8TH CROSS
DEVANARAPALYA
BANGALORE - 560 054.
...RESPONDENT
(BY SRI. M. KRISHNA MURTHY, ADVOCATE)
THIS CRL.A FILED U/S.397 AND 401 OF CR.P.C PRAYING
TO SET ASIDE THE JUDGMENT AND ORDER DATED 12.04.2012
PASSED BY THE V FAST TRACK (SESSIONS) JUDGE,
BANGALORE IN CRL.A.NO.807/2011 AND UPHOLD THE
JUDGMENT AND ORDER DATED 10.11.2011 PASSED BY THE XII
ADDITIONAL CHIEF METROPOLITAN MAGISTRATE,
BANGALORE, IN C.C.NO.4227/2009 AND ETC.,
THIS CRIMINAL APPEAL HAVING BEEN HEARD AND
RESERVED FOR JUDGMENT BEFORE THE PRINCIPAL BENCH AT
BENGALURU ON 30.08.2023, COMING ON FOR
PRONOUNCEMENT OF JUDGMENT, BEFORE DHARWAD BENCH,
THROUGH VIDEO CONFERENCING, THIS DAY, THE COURT
DELIVERED THE FOLLOWING:
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CRL.A No. 733 of 2012
JUDGMENT
1. This appeal is filed by the appellant/complainant being aggrieved by the judgment and order of acquittal dated 12.04.2012 in Crl.A.No.807/2011 on the file of the Fast Track (Sessions) Judge-V at Bengaluru City, wherein the Appellate Court set aside the judgment of conviction and order of sentence dated 10.11.2011 in C.C.No.4227/2009 for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short, 'N.I. Act').
2. The rank of the parties in the Trial Court henceforth will be considered as it is, for convenience.
Brief facts of the case:
3. The complainant and the accused were friends. The accused had approached the complainant to borrow the amount in the month of March, 2008 and borrowed a sum of Rs.5,00,000/- to meet his business requirements and urgent necessities and promised that the amount would be repaid at the earliest. The amount was paid to the complainant on 27.03.2008. The complainant made several efforts to get back his amount, however, the accused did not repay the amount. -3- CRL.A No. 733 of 2012 On Several demands having been made, the accused issued a cheque dated 20.09.2008 for repayment of the loan. The said cheque was presented for encashment on 01.10.2008. The said cheque came to be dishonoured as "funds insufficient" on 03.10.2008. A notice came to be issued both by RPAD and Under Certificate of Posting (UCP) on 30.10.2008. The notice sent through RPAD was returned unserved as not claimed and notice sent through UCP is considered as deemed service. Even after receipt of legal notice, the accused has not chosen to reply to the legal notice nor repaid the amount. Hence, the complainant filed a complaint before the Jurisdictional Magistrate.
4. To prove the case of the complainant, the complainant examined himself as PW1 and also got examined another witness as PW2 and got marked 6 documents as Exs.P1 to P6. On the other hand, the accused examined himself as DW1 and got examined another witness as DW2 and also got marked 7 documents as Exs.D1 to D7. The Trial Court after appreciating the oral and documentary evidence on record, recorded the conviction stating that the cheque and the signature are admitted and the Court has raised the presumption under Section 139 of N.I. Act. However, in the -4- CRL.A No. 733 of 2012 appeal filed by the appellant/accused, the Appellate Court has set aside the judgment of conviction. The notice issued to the accused relating to dishonour of cheque has not duly served to the correct address of the respondent.
5. Heard Sri Rohit Urs D., learned for the appellant and Sri M.Krishna Murthy, the learned counsel for the respondent. Perused the records.
6. It is the submission of the learned counsel for the appellant that the judgment and order of acquittal recorded by the Appellate Court is perverse, illegal and the same is liable to be set aside. It is further submitted that inspite of legal notice having been served through Under Certificate of Posting, the Appellate Court failed to take note of the same and held that Section 138(b) of N.I. Act has not been complied and the proceedings held to be vitiated, which appears to be incorrect and the Appellate Court failed to take note of provision under Section 114 of the Indian Evidence Act and also Section 27 of the General Clause Act.
7. It is further submitted that the Appellate Court failed to take note of the presumption available under Section 139 of N.I. Act. The respondent/accused admitted both the -5- CRL.A No. 733 of 2012 signature and issuance of the cheque, however denied the transaction.
8. Once issuance of the cheque and signature are admitted, the Court has to raise the presumption mandatorily. Having failed to take note of the said aspect resulted in passing the impugned judgment, which is required to be set aside. Making such submission, learned counsel for the appellant/complainant prays to allow the appeal.
9. Per contra, learned counsel for the respondent vehemently justified the judgment and order of Appellate Court in setting aside the judgment of conviction and order of sentence passed by the Trial Court and submitted that issuance of notice contemplated under Section 138(b) of N.I. Act is one of the essential ingredients for the offence punishable under Section 138 of N.I. Act. When the issuance of the notice is not proved, the entire proceedings could be vitiated. The Appellate Court considering that the legal notice was not served, set aside the judgment of conviction passed by the Trial Court.
10. It is further submitted that the complainant had failed to prove the transaction and also not established the legally enforceable debt or liability. Considering the said aspect, -6- CRL.A No. 733 of 2012 the Appellate Court reversed the judgment of conviction passed by the Trial Court. Hence, the judgment and order of acquittal passed by the Appellate Court is appropriate which is not required to be interfered.
11. After having heard the learned counsel for the respective parties and also perused the findings of the Appellate Court in reversing the judgment of conviction and order of sentence passed by the Trial Court, the points which would arise for my consideration are:-
i. Whether the findings of the Appellate Court in recording the acquittal by setting aside the judgment of conviction and order of sentence passed by the Trial Court is sustainable?
ii. Whether the appellant has made out grounds to interfere with the said findings?
12. Points No.1 and 2:- This Court being the First Appellate Court in order to ascertain both facts and law, it is necessary to appreciate both facts and law. However, there is a rider by the statute that in a case of appeal against acquittal, the Appellate Court has to interfere only where it is noticed the perversity in the findings of the Trial Court or Appellate Court. -7- CRL.A No. 733 of 2012 Having considered the legal aspect in respect of appeal against acquittal, it is necessary to have cursory look upon the evidence of witnesses.
13. PW1 being the complainant has categorically stated that the respondent/accused had borrowed Rs.5,00,000/- from him on 27.03.2008 and assured that the amount would be repaid within short period, however, he did not repay the amount. When the complainant asked to refund the amount, the accused had issued a cheque dated 20.09.2008. When it was presented for encashment, the said cheque was dishonoured as "insufficient funds". The complainant brought to the notice of the accused regarding dishonour of cheque through legal notice. However, the accused neither issued reply to the said notice nor repaid the amount. Hence, the complaint is filed by the complainant before the jurisdictional Magistrate.
14. The contention of the accused at the initial stage is that he has not received notice and notice was not issued to the correct address of the accused. Further, he has contended that the complainant has failed to establish the existence of legally enforceable debt. Now it is relevant to refer to the provision of Section 138(b) of N.I. Act which reads as under:- -8- CRL.A No. 733 of 2012
"(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, (within thirty days) of the receipt of information by him from the bank regarding the return of the cheque as unpaid."
15. On reading of the above said provision, it makes it clear that notice in respect of dishonour of cheque has to be issued to the drawer of the cheque. Admittedly, in the present case, the complainant has issued a notice regarding dishonour of the cheque. Whether the said notice is served or whether it was issued to the correct address of the drawer of the cheque is the moot question which is required to be answered. The contention of the respondent/accused is that he was the owner of Jagadamba Auto Consultancy situated at No.7, Muni Lakshmamma Compound, Devanarapalya, HMT Road, II Phase, Bengaluru-52. As per his evidence, he has stopped his business in the year January, 2008. Further, he has stated that he was not running any business at No.15/1, Ground Floor, Next to St.Paul Beauty Parlour, Gokul 2nd Stage, 2nd Main, HMT Road, Devanarapalya, Bengaluru-52. In order to substantiate his case, DW1 got examined another witness as DW2 who is the owner of shop premises, wherein DW1 was inducted as a tenant of the premises of DW2. DW2 in his evidence endorsed -9- CRL.A No. 733 of 2012 the evidence of DW1 and stated that DW1 was doing business in the premises and vacated the said premises in the month of January, 2008. As per the evidence of the complainant, he had issued Ex.P3-legal notice wherein the address mentioned as "M/s Jagadamba Auto Consultants, No.15/1, Ground Floor, Next to St.Paul Beauty Parlour, Gokula Ist Stage, IInd Main, H.M.T. Road, Devendraplaya, Bangalore-560054." It is obvious that the said notice was not served to the respondent. Now, it is relevant to take note of the order sheet of the Trial Court. The respondent entered his appearance to the Trial Court and appeared before the Trial Court. Ex.P6 is the complaint. The address of the respondent is similar to that of Ex.P3-legal notice. The Trial Court issued summons, it was served to the respondent and the respondent appeared before the Trial Court and contested the matter. Once he appeared before the Court after summons being served, he is estopped from contending that notice is not served which was issued by the complainant regarding dishonour of cheque.
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CRL.A No. 733 of 2012
16. My view has been fortified by the Hon'ble Supreme Court in the case of C.C.Alavi Haji V/s Palapetti Muhammed and another1, Paragraph No.17 held as under:
"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 Section 138 of 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 Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the GC Act and Section 114 of the Evidence Act. In our view, any other interpretation of the proviso would defeat the very object of the legislation. As observed in Bhaskaran case [(1999) 7 SCC 510 : 1999 SCC (Cri) 1284] if the "giving of notice" in the context of Clause (b) of the proviso was the same as the "receipt of notice" a trickster 1 (2007) 6 SCC 555
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CRL.A No. 733 of 2012cheque drawer would get the premium to avoid receiving the notice by adopting different strategies and escape from legal consequences of Section 138 of the Act."
17. On careful reading of the dictum of the Hon'ble Supreme Court, it makes it clear that when the address mentioned in the cause title of the complaint is similar to the legal notice and if the respondent received the summons from the Court and appeared before the Court, on receipt of summons, he cannot claim that he has not received the notice contemplated under Section 138(b) of N.I. Act. In other words, he is estopped from claiming that no notice was served to him.
18. Regarding the other liability is concerned, DW1 has contended that he has not received any financial assistance from the complainant and he did not issue the cheque. Except denial, the accused/respondent has not produced any documentary evidence or any other witness to show that he had not borrowed loan and cheque was not issued to the complainant/appellant.
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CRL.A No. 733 of 2012
19. Now, it is relevant to refer to the judgment of the Hon'ble Supreme Court in the case of Kishan Rao V/s Shankargouda2 Paragraph No.20 reads thus:
"20. This Court held that the accused may adduce evidence to rebut the presumption, but mere denial regarding existence of debt shall not serve any purpose. The following was held in para 20: (Sharma Carpets case [Kumar Exports v. Sharma Carpets, (2009) 2 SCC 513 :
(2009) 1 SCC (Civ) 629 : (2009) 1 SCC (Cri) 823] , SCC p. 520) "20. ... The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the court need not insist in every case that the accused should disprove the non-existence of consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that bare denial of the passing of the consideration and existence of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumptions, the accused should bring 2 (2018) 8 SCC 165
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on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist. ..."
20. In another case in the case of Bir Singh V/s Mukesh Kumar3 Paragraph No.18, 20 and 24 reads as under:
"18. In passing the impugned judgment and order dated 21-11-2017 [Mukesh Kumar v. Bir Singh, 2017 SCC OnLine P&H 5352], the High Court misconstrued Section 139 of the Negotiable Instruments Act, which mandates that unless the contrary is proved, it is to be presumed that the holder of a cheque received the cheque of the nature referred to in Section 138, for the discharge, in whole or in part, of any debt or other liability. Needless to mention that the presumption contemplated under Section 139 of the Negotiable Instruments Act, is a rebuttable presumption. However, the onus of proving that the cheque was not in discharge of any debt or other liability is on the accused drawer of the cheque.
20. Section 139 introduces an exception to the general rule as to the burden of proof and shifts the onus on the accused. The presumption under 3 (2019) 4 SCC 197
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Section 139 of the Negotiable Instruments Act is a presumption of law, as distinguished from presumption of facts. Presumptions are rules of evidence and do not conflict with the presumption of innocence, which requires the prosecution to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumptions of law and presumptions of fact unless the accused adduces evidence showing the reasonable possibility of the non-existence of the presumed fact as held in Hiten P. Dalal [Hiten P. Dalal v. Bratindranath Banerjee, (2001) 6 SCC 16 :
2001 SCC (Cri) 960] .
24. In K.N.Beena v. Muniyappan [K.N.Beena v. Muniyappan, (2001) 8 SCC 458 : 2002 SCC (Cri) 14] , this Court held that in view of the provisions of Section 139 of the Negotiable Instruments Act read with Section 118 thereof, the Court had to presume that the cheque had been issued for discharging a debt or liability. The said presumption was rebuttable and could be rebutted by the accused by proving the contrary. But mere denial or rebuttal by the accused was not enough. The accused had to prove by cogent evidence that there was no debt or liability. This Court clearly held that the High Court had erroneously set aside the conviction, by proceeding on the basis that denials/averments in the reply of the accused were sufficient to shift the burden of proof on the complainant to prove that the cheque had been
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issued for discharge of a debt or a liability. This was an entirely erroneous approach. The accused had to prove in the trial by leading cogent evidence that there was no debt or liability."
21. On careful reading of the dictums of the Hon'ble Supreme Court, it makes it clear that the complainant is protected under Section 139 of N.I. Act. It is presumed that the complainant has received the cheque for the legally enforceable debt or liability unless contrary is proved. The said presumption is rebuttable, the accused has to rebut the presumption by leading cogent evidence i.e., the initial burden lies on the accused to rebut the presumption. However mere denial is not sufficient.
22. On careful reading of the above proposition of law, the accused in this case except bare denial of the transaction, he has not produced any documents to substantiate the contention and moreover the accused has stressed with regard to non-service of notice. When the service of notice has been answered affirmatively by considering the dictum of the Hon'ble Supreme Court in the case of C.C.Alavi Haji stated supra, it can be inferred that the findings of the Appellate Court in respect of service of notice which appears to be erroneous and
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CRL.A No. 733 of 2012inappropriate. Therefore, the order of acquittal passed by the Appellate Court is required to be set aside. The findings of the Trial Court in respect of the conviction appears to be appropriate. Therefore, it is required to be confirmed.
23. In the light of the observation made above, the points which arose for my consideration are as under:-
Point No.(i) - In the 'Negative';
Point No.(ii) - In the 'Affirmative' .
24. Hence, I proceed to pass the following:
ORDER
i) The Criminal Appeal is allowed.
ii) The judgment and order of acquittal dated 12.04.2012 passed in Criminal Appeal No.807/2011 by the Court of Fast Track (Sessions) Judge-V, Bangalore City, is set aside.
iii) The judgment of conviction and order of sentence dated 10.11.2011 passed in C.C.No.4227/2009 by the Court of XII Addl.Chief Metropolitan Magistrate at Bangalore City is hereby confirmed.
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iv) The registry is directed to send the records to the Trial Court along with copy of the judgment for execution of sentence in accordance with law.
Sd/-
JUDGE CLK/Bss