Karnataka High Court
Shankar Siddappa Kurbar vs Sri.Basavaraj S.Tarale on 26 July, 2012
Author: Anand Byrareddy
Bench: Anand Byrareddy
1
IN THE HIGH COURT OF KARNATAKA
CIRCUIT BENCH AT DHARWAD
DATED THIS THE 26th DAY OF JULY, 2012
BEFORE
THE HON'BLE MR. JUSTICE ANAND BYRAREDDY
CRIMINAL APPEAL No.2763/2009
BETWEEN:
Shankar Siddappa Kurbar,
C/o P.R.Hiremath,
Resident of Plot No.32,
Sector No.11, Mahantesh Nagar,
Belgaum. .. APPELLANT
(by Shri Santosh B Mane, Advocate)
AND:
Shri Basavaraj S Tarale,
Age: Major,
Resident of Mahadwar Road,
Cross No.3, House No.351/1,
C.C.B/No.7,
Belgaum. .. RESPONDENT
(BY Shri T.G.Varute, Advocate - absent)
This Criminal Appeal is filed under Section 378(1) of the
Code of Criminal Procedure, 1973 praying to allow the appeal
and set aside the impugned judgment of acquittal dated
4.8.2009 passed by the learned JMFC-II Belgaum in CC
2
No.1146/2007 and punish the respondent - accused for
commission of offence punishable under Section 138 of the
Negotiable Instruments Act, 1881.
This appeal coming on for preliminary hearing, this day,
the court delivered the following:
JUDGMENT
Heard the learned Counsel for the appellant and the learned Counsel for the respondent remains absent.
2. The present appellant was the complainant before the trial court alleging an offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (Hereinafter referred to as the 'Act', for brevity) . It was the case of the present appellant
- complainant that the accused - respondent was known to him and he had approached him for financial help and had borrowed a sum of Rs.4,00,000/- from the present appellant and failed to repay the same inspite of several requests and ultimately, he had issued a cheque bearing No.0314010 dated 10.6.2006, drawn on Saraswat Co-operative Bank, Belgaum. When the same was presented for encashment, it was returned 3 with an endorsement that the funds were insufficient and immediately on receipt of the intimation, the appellant had issued a notice, which was returned with an endorsement as not claimed. Therefore, on a deemed service of notice, the appellant had lodged a complaint. The summons having been issued, the accused had appeared before the court and had contested the proceedings. The appellant had tendered evidence. The respondent denied the entire transaction and it was vehemently urged that the present complainant did not have the means to lend such a substantial amount of money and there was no evidence produced to show that the complainant had the funds as on the relevant date to have lent the money. It is on those contentions that the following point was framed :-
"1. Whether the complainant proves beyond all reasonable doubt that accused in discharge of legally recoverable debt has issued the cheque bearing No.0314010 dated 10.06.2006 for Rs.4,00,000/- drawn on The Saraswat Co- Operative Bank Ltd., Belgaum which came to be dishonoured with the endorsement 4 "INSUFFICIENT FUNDS" on 07.11.2006; in spite of deemed service of notice, accused has not paid the cheque amount and thereby committed an offence punishable under section 138 of the Negotiable Instruments Act?"
3. The court below had proceeded on the footing that the initial burden was on the present appellant to establish that there was a legally enforceable debt and that the cheque was issued by the respondent to discharge the debt and it was thereafter returned for insufficiency of funds. In this regard, the court below has strongly relied upon several judgments, including the judgment in the case of Krishna Janardhan Bhat vs. Dattatraya G Hegde, AIR 2008 SC 1325, and has held that if the initial burden is on the complainant and unless that burden is discharged, the burden does not shift to the accused to establish that he has failed to discharge the legally recoverable debt. In this context, the court below has held that since the respondent has raised a contention that there were no funds available with the appellant, as on the date of the transaction 5 and he did not have any source of such funds, it was incumbent on the appellant to have discharged that burden to establish that he did have the funds and since no documents were produced by the appellant to establish that he had adequate funds to have granted a loan to the respondent, the court below has negated the case of the complainant and has dismissed the complaint. It is that which is under challenge in the present appeal.
4. It is necessary to notice that the respondent has not denied the issuance of the cheque or his signature on the cheque. He has solely relied on the contention that the appellant was dishonestly in possession of the cheque and has later sought to misuse the same. Insofar as the reliance sought to be placed on a judgment in the case of Krishna Janardhan Bhat, supra, is bad in law as the same was considered by a larger bench in the case of Rangappa vs. Mohan, 2010 SC 1898, wherein the larger bench has held that the judgment in Krishna Jarnardhan Bhat, supra, would apply only to the facts of that case and the ratio laid down therein may not be pressed 6 into service in any other case and accordingly has held that the presumption under Section 139 of the NI Act, is in favour of a holder of a cheque. Therefore, the initial burden is on the accused to establish that there was no legally enforceable debt. This, he may do so, by tendering independent evidence to establish that there was no legally enforceable debt or he may even rely on the evidence of the complainant himself to demonstrate that there was no legally enforceable debt. The court below, therefore, was in error in proceeding to hold that there was a burden cast on the appellant to establish that he had funds in the first place to have lent monies to the respondent. The court was entirely guided by the judgment in Krishna Janardhan Bhat, supra, which has been held to be not a good law and therefore, the judgment which rests primarily on the said decision cannot be sustained. There was no such liability on the appellant to establish that he had funds as on the date of the transaction to have lent monies to the respondent. It was sufficient if the appellant was in a position to establish that the cheque in question was issued on the account of the respondent 7 and that it was duly signed by him. On both those counts, the appellant meets the requirements. Hence, on that short ground that the court below having proceeded on the assumption that the initial burden was on the appellant is not sustainable.
5. Accordingly, the judgment of the court below is set aside. The appellant has established that the respondent has committed an offence punishable under Section 138 of the NI Act and accordingly, the respondent is hereby convicted and sentenced to pay a fine of Rs.8,00,000/- of which, a sum of Rs.7,90,000/- shall be paid as compensation to the present appellant. In default of the same, the respondent is sentenced to undergo simple imprisonment for six months.
Accordingly, the appeal is allowed in terms as above. Incidentally, the appellant has filed an application seeking to produce additional documents to establish that he had the means to have lent monies to the respondent. This is 8 entirely unnecessary. Therefore, the application is not taken into account.
Sd/-
JUDGE nv