Karnataka High Court
Ravi Alias Ravindragouda Fakkiragouda ... vs Irappa Alias Iranna S/O. Hanumanthappa ... on 20 June, 2025
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NC: 2025:KHC-D:7907
CRL.RP No. 100365 of 2021
HC-KAR
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 20TH DAY OF JUNE, 2025
BEFORE
THE HON'BLE MR. JUSTICE K V ARAVIND
CRIMINAL REVISION PETITION NO.100365 OF 2021
(397(Cr.PC)/438(BNSS))
BETWEEN:
RAVI @ RAVINDRAGOUDA FAKKIRGOUDA PATIL,
AGE. 46 YEARS,
OCC. AGRICULTURE AND SOCIAL SERVICE,
R/O. MUSTUR, TALUK. RANEBENNUR,
DISTRICT. HAVERI-581208.
...PETITIONER
(BY SRI J.S. SHETTY, ADVOCATE)
AND:
IRAPPA @ IRANNA S/O. HANUMANTHAPPA VADDAR,
AGE. 55 YEARS, OCC. AGRICULTURE,
R/O. NUKAPURA, TALUK. RANEBENNUR,
DISTRICT. HAVERI-581115.
...RESPONDENT
(BY SRI DEEPAK C.MAGANUR, ADVOCATE)
Digitally signed by
CHANDRASHEKAR
LAXMAN KATTIMANI THIS CRIMINAL REVISION PETITION IS FILED UNDER
Location: HIGH
COURT OF SECTION 397(1) R/W 401 OF CR.P.C., PRAYING TO, THE ORDER
KARNATAKA
DATED 19.08.2021 PASSED BY THE II ADDITIONAL DISTRICT AND
SESSIONS JUDGE AT HAVERI (SITTING AT RANEBENNUR) IN
CRIMINAL APPEAL NO.78/2020 CONFIRMING THE ORDER OF
CONVICTION AND SENTENCE DATED 16.09.2020 PASSED BY THE III
ADDITIONAL SENIOR CIVIL JUDGE AND JMFC RANEBENNUR IN C.C.
NO.259/2015 CONVICTING THE PETITIONER HEREIN FOR THE
OFFENCE PUNISHABLE UNDER SECTION 138 OF NEGOTIABLE
INSTRUMENT ACT, MAY BE SET ASIDE BY ALLOWING THIS REVISION
PETITION WITH THE COST THROUGHOUT IN THE ENDS OF JUSTICE
AND EQUITY.
THIS CRIMINAL REVISION PETITION, COMING ON FOR
HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
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NC: 2025:KHC-D:7907
CRL.RP No. 100365 of 2021
HC-KAR
ORAL ORDER
(PER: THE HON'BLE MR. JUSTICE K V ARAVIND) Heard Sri J.S. Shetty, learned counsel for the revision petitioner-accused and Sri Deepak C. Maganur, learned counsel for the respondent.
2. This criminal revision petition is filed by the accused in C.C. No.259/2015, challenging the judgment of conviction and order on sentence dated 16.09.2020 passed by the III Additional Senior Civil Judge and JMFC, Ranebennur (hereinafter referred to as 'the trial Court'), and the judgment dated 19.08.2021 passed in Criminal Appeal No.78/2020 by the II Additional District and Sessions Judge, Haveri (sitting at Ranebennur) (hereinafter referred to as 'the appellate Court').
3. The respondent-complainant filed a complaint alleging that the accused had borrowed a sum of Rs.3,00,000/- from him in the month of June 2014, with an assurance to repay the same within six to seven months. In discharge of the said liability, the petitioner issued a cheque bearing No.003955, drawn on State Bank of Mysore, Kumarpattanam Branch, for a sum of Rs.3,00,000/-. When the -3- NC: 2025:KHC-D:7907 CRL.RP No. 100365 of 2021 HC-KAR cheque was presented for encashment on 30.12.2014, it was returned with the endorsement 'funds insufficient'. The respondent thereafter issued a legal notice to the petitioner, which was refused by the petitioner. Consequently, the respondent filed a complaint against the petitioner alleging commission of an offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short, 'the NI Act').
4. In support of his case, the complainant examined himself as PW.1, and another witness was examined as PW.2. He also marked 8 documents as Exhibits P1 to P8. The petitioner-accused examined himself as DW.1, however, no documents were marked on his behalf. The trial Court on consideration of the oral and documentary evidence, held that the debt was legally enforceable. It further recorded a finding that the cheque and the signature thereon stood duly proved as that of the accused. The trial Court also held that the presentation of the cheque for the second time was permissible in law. Accordingly, it concluded that the accused had committed the offence punishable under Section 138 of the NI Act and sentenced him to pay a fine of Rs.3,10,000/-. -4-
NC: 2025:KHC-D:7907 CRL.RP No. 100365 of 2021 HC-KAR
5. Being aggrieved by the said judgment of conviction, the petitioner-accused preferred Criminal Appeal No.78/2020. The appellate Court, on re-appreciation of the evidence on record, dismissed the appeal and confirmed the judgment of conviction passed by the trial Court.
6. Sri J.S. Shetty, learned counsel appearing for the petitioner, submits that the proceedings were initiated pursuant to a second notice, which is impermissible in law. He contends that once a statutory notice is issued and repayment is not made within the stipulated period, the cause of action to initiate proceedings under Section 138 of the NI Act arises and must be exercised within the prescribed timelines. Having failed to initiate proceedings within such period, issuance of a second notice is not legally sustainable.
6.1 Learned counsel further submits that the respondent lacked the financial capacity to lend the alleged amount. It is also contended that the cheque in question was an old-format cheque, and that the entire format of cheques had been revised pursuant to RBI guidelines. Therefore, the -5- NC: 2025:KHC-D:7907 CRL.RP No. 100365 of 2021 HC-KAR cheque is invalid and does not constitute a valid legal tender in terms of the prevailing RBI guidelines.
6.2 In the alternative, learned counsel submits that, in compliance with the order of this Court, a sum of Rs.1,60,000/- has already been deposited. He further submits that if a period of 6 months is granted to pay the balance amount, the petitioner is willing to repay the same as directed by the trial Court.
7. Per contra, Sri Deepak C. Maganur, learned counsel appearing for the respondent, submits that the cheque and the signature thereon have been duly proved, and that a statutory presumption under Section 139 of the NI Act operates against the accused. It is contended that the petitioner has failed to discharge the burden of rebutting the said presumption. Learned counsel submits that once the existence of a legally enforceable debt is established, the question of proving the financial capacity of the complainant does not arise. It is further submitted that the cheque in question was valid, as evidenced by the fact that it was returned by the Bank with the -6- NC: 2025:KHC-D:7907 CRL.RP No. 100365 of 2021 HC-KAR endorsement 'insufficient funds'. Had the cheque been invalid, the Bank would not have returned it on that ground.
8. Insofar as the submission of learned counsel for the petitioner seeking six months' time to pay the balance amount, learned counsel for the respondent vehemently opposes the same, contending that the loan transaction is of the year 2014, and the petitioner has failed to repay the amount even after the lapse of eleven years. He submits that the concurrent findings recorded by both the trial Court and the appellate Court are well-reasoned and do not warrant any interference by this Court in exercise of its revisional jurisdiction. Learned counsel further submits that issue of second notice is held to be permissible. In support of his submissions, learned counsel places reliance on the judgment of the Hon'ble Supreme Court in MSR Leathers v. S. Palaniappan and Another [(2013) AIR SCW 597].
9. Considered the submissions advanced by the learned counsel for the parties and perused the materials on record.
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NC: 2025:KHC-D:7907 CRL.RP No. 100365 of 2021 HC-KAR
10. As is evident from the record, the fact that the cheque and the signature thereon belong to the petitioner is not in dispute. Two principal contentions are urged by the petitioner. First, that the respondent-complainant lacked the financial capacity to lend a sum of Rs.3,00,000/- and second, that the proceedings were initiated pursuant to a second statutory notice. Insofar as the financial capacity of the complainant is concerned, it is pertinent to note that the petitioner did not raise this defence at the earliest opportunity, i.e., upon receipt of the statutory notice. The cheque in question carries with it the statutory presumption under Sections 118 and 139 of the Negotiable Instruments Act, 1881, in favour of the complainant. Once the execution of the cheque and the signature thereon are not disputed, the burden shifts to the accused to rebut the presumption and establish that no legally enforceable debt or liability existed. Although the petitioner entered the witness box and cross-examined PW.1, no material evidence was elicited to probabilise the defence. Thus, the petitioner has failed to discharge the burden cast upon him under law.
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NC: 2025:KHC-D:7907 CRL.RP No. 100365 of 2021 HC-KAR
11. The contention that issuance of a second statutory notice is impermissible is no longer res integra. The Hon'ble Supreme Court, in the case of MSR Leathers (supra), has categorically held as under:
"32. The controversy, in our opinion, can be seen from another angle also. If the decision in Sadanandan Bhadran's case (AIR 1998 SC 3043 :
1998 AIR SCW 2902) (supra) is correct, there is no option for the holder to defer institution of judicial proceedings even when he may like to do so for so simple and innocuous a reason as to extend certain accommodation to the drawer to arrange the payment of the amount. Apart from the fact that an interpretation which curtails the right of the parties to negotiate a possible settlement without prejudice to the right of holder to institute proceedings within the outer period of limitation stipulated by law should be avoided we see no reason why the parties should, by a process of interpretation, be forced to launch complaints where they can or may like to defer such action for good and valid reasons. After all, neither the courts nor the parties stand to gain by institution of proceedings which may become unnecessary if cheque amount is paid by the drawer. The Magistracy in this country is over-burdened by an avalanche of cases under Section 138 of the Negotiable Instruments Act. If the first default itself must in terms of the decision in Sadanandan Bhadran's case (supra) result in filing of prosecution, avoidable litigation would become an inevitable bane of the legislation that was intended only to bring solemnity to cheques without forcing the parties to resort to proceedings in the courts of law. While there is no empirical data to suggest that the problems of overburdened Magistracy and judicial system at the -9- NC: 2025:KHC-D:7907 CRL.RP No. 100365 of 2021 HC-KAR district level is entirely because of the compulsions arising out of the decisions in Sadanandan Bhadran's case (supra), it is difficult to say that the law declared in that decision has not added to court congestion.
33. In the result, we overrule the decision in Sadanandan Bhadran's case, (AIR 1998 SC 3043 :
1998 AIR SCW 2902) (supra) and hold that the prosecution based upon second or successive dishonour of the cheque is also permissible so long as the same satisfies the requirements stipulated in the proviso to Section 138 of the Negotiable Instruments Act. The reference is answered accordingly. The appeals shall now be listed before the regular Bench for hearing and disposal in light of the observations made above."
12. In the light of the law laid down by the Hon'ble Supreme Court, issuance of a second or successive statutory notice would continue to satisfy the requirements of Section 138 of the N.I. Act.
13. It is also the case of the complainant that upon issuance of the first statutory notice, although a reply was submitted, the petitioner sought time to repay the loan, and therefore, further proceedings were not initiated at that stage.
However, as the petitioner failed to honour his commitment, a second notice was issued and the present proceedings were initiated. The Hon'ble Supreme Court has considered such
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NC: 2025:KHC-D:7907 CRL.RP No. 100365 of 2021 HC-KAR circumstances, wherein an opportunity was afforded to the drawer to make the payment before initiating prosecution. In that view of the matter, the said contention of the petitioner is of no assistance and does not merit acceptance.
14. Both the trial Court and the appellate Court, having duly considered the aforesaid aspects and the evidence placed on record by both parties, have rightly concluded that the petitioner-accused has committed the offence punishable under Section 138 of the NI Act.
15. This Court has also perused the evidence on record as well as the findings recorded by both the Courts below. The conclusions arrived at by the trial Court and the appellate Court are based on the evidence on record and are supported by cogent reasons, in consonance with the provisions of the Negotiable Instruments Act, 1881. No ground is made out to warrant interference with the concurrent findings recorded by both the Courts.
16. The next issue that arises for consideration is the prayer made by the petitioner for grant of time to pay the
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NC: 2025:KHC-D:7907 CRL.RP No. 100365 of 2021 HC-KAR balance amount. It is submitted that a sum of Rs. 1,60,000/- has been deposited before the trial Court in compliance with the interim order passed by this Court. Though learned counsel for the petitioner submitted that the said amount has been withdrawn by the respondent, the respondent was reluctant to confirm the same. Be that as it may, the cheque in question pertains to the year 2014, and the request for six months' time to repay the balance amount does not appear to be justified.
17. However, in order to balance the interests of both the complainant and the accused, this Court deems it appropriate to grant a period of two months to the petitioner to pay the remaining amount. Further, if the amount deposited has not been withdrawn by the respondent-complainant, there shall be no impediment for the respondent-complainant to withdraw the amount in deposit.
18. In light of the above, the following order is passed:
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NC: 2025:KHC-D:7907 CRL.RP No. 100365 of 2021 HC-KAR ORDER i. The Criminal Revision Petition is allowed in part.
ii. The order of conviction dated 16.09.2020 passed by the III Additional Senior Civil Judge and JMFC, Ranebennur and order in Criminal Appeal No.78/2020 dated 19.08.2021 passed by the II Additional District and Sessions Judge, Haveri (sitting at Renebennur), is hereby confirmed.
iii. Two months' time is granted to the
petitioner/accused to deposit a sum of
Rs.1,50,000/-.
iv. It is made clear that if the amount as ordered
above is not deposited within the time, the petitioner/accused shall undergo simple imprisonment as ordered by the Trial Court. v. If the amount is not paid within time, the complainant/respondent is at liberty to move
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NC: 2025:KHC-D:7907 CRL.RP No. 100365 of 2021 HC-KAR the appropriate application before the trial Court for enforcement of this order. vi. Bail bonds and sureties if any, stands cancelled.
Registry to return the trial Court records along with a copy of this order for compliance.
Sd/-
(K V ARAVIND) JUDGE DDU CT: UMD List No.: 1 Sl No.: 20