Karnataka High Court
Sangayya S/O Adivayya Salimath vs Sri Shankargouda S/O Dyamappagouda ... on 21 December, 2020
Author: P.N.Desai
Bench: P.N.Desai
1
IN THE HIGH COURT OF KARNATAKA
KALABURAGI BENCH
DATED THIS THE 21st DAY OF DECEMBER, 2020
BEFORE
THE HON'BLE MR.JUSTICE P.N.DESAI
CRIMINAL APPEAL No.200028/2014
BETWEEN:
Sri. Sangayya s/o Adivayya Salimath
Age: 58 Years Occ: Proprietor,
M/s. Rajashree Agro Service, Bijapur
R/o: Near Mugulkhod Math Solapur Road,
Bijapur.
...APPELLANT
(By Shri. S. S. Mamadapur, Advocate)
AND:
Sri. Shankargouda s/o Dyamappagouda
Biradar,
Age: 58 Years Occ: Agriculture
R/o: Gabasavalagi Tq: Sindagi.
Dist: Bijapur-586 101.
... RESPONDENT
(By Sri. Ravi Madabhavi, Advocate)
This Criminal Appeal is filed under Section 378 (4)
Criminal Procedure Code, praying to set-aside the judgment
and order of acquittal dated 17.09.2013 passed by the
learned II Addl. JMFC Bijapur in C.C.No.471/2005
acquitting the respondent herein for the offences under
Section 138 of N.I. Act and convict the sentence the
respondent for such offence in accordance with law.
This appeal having been heard, reserved for judgment
and coming on for pronouncement of judgment this day, this
court delivered the following:
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JUDGMENT
This appeal lays challenge to the Judgment of acquittal passed by the learned II Addl. JMFC Bijapur in C.C. No.471/2005 dated: 17-09-2013 for the offence punishable under Section 138 of Negotiable Instrument Act.
2. The appellant was the complainant and the respondent was the accused before the trial court. For the purpose of convenience the appellant and respondent will be referred as complainant and accused as per their respective ranks before the trial court.
3. The appellant/complainant filed complaint under section 200 of Code of Criminal Procedure before the J.M.F.C Court stating that, the accused has committed an offence punishable under section 138 of Negotiable Instrument Act.
4. It is the case of the complainant that, he was having a dealership of tractor and its equipment at 3 Vijayapur and he was carrying on the business in the name of M/s Rajashree Agro Services. The accused and complainant were close friends and there were many transactions between them. The accused purchased tractor from the complainant. He used to take hand loan from the complainant for his family necessity and return back.
It is the case of the complainant that, on 11-06- 2003 the accused approached the complainant with a request to lend hand loan of Rs.52,000/- for his family needs and for repair of Tractor. Looking to the previous transaction the complainant agreed to pay Rs.52,000/- and as security of the said amount, he issued post dated cheque dated: 26-07-2003 drawn in the Grameen Bank, branch Aski Taluka Sindagi bearing cheque No0136305 for Rs.52,000/-. He also executed a 'Kaigad patra' i.e. "Hand loan deed" for the same amount. As requested by the accused, the complainant presented said cheque dated: 26-07-2003 for encashment, but the 4 same was returned dishonored with the endorsement that the funds insufficient. The complainant issued legal notice on 28-11-2003 calling upon the accused to pay the amount, but the notice was returned with endorsement as "refused". Thereafter he lodged complaint in this regard as the accused did not paid amount to him.
5. The accused appeared before the trial court.
6. Thereafter words the learned J.M.F.C. recorded the Plea by putting substance of accusation to accused for the offence punishable under section 138 of Negotiable Instrument Act. The accused pleaded not guilty and claims to be tried.
7. The complainant got examined himself as PW.1 and one witness as PW.2 and got marked 15 documents as per Ex.P.1 to Ex.P.15 and closed his side evidence.
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8. The statement of accused as required U/sec.313 of Code of Criminal Procedure was recorded. The accused denied the incriminating circumstances appearing against him in the evidence of prosecution witnesses. The accused got examined himself as DW.1 and one witness as DW.2 and got marked as nine documents as Ex.D.1 to Ex.D.9 as defense evidence.
9. After hearing arguments, the learned J.M.F.C., acquitted the accused. Aggrieved by the said acquittal, the appellant/complainant has preferred this appeal on the following grounds:-
a) that the reasons assigned and the conclusion arrived by the trial court are not sustainable in law.
b) that the accused admitted execution of Ex.P.1 cheque, notice is also refused, no reply is received.
c) that the trial court has failed to raise presumption in favour of the appellant that the cheque was issued in discharge of legally recoverable debt or 6 other liability as required under section 138 of Negotiable Instrument Act, the same being unrebutted by the accused ought not to have acquitted.
d) It is to be noted that, the defense set up by the accused is improbable one because according to the accused, the cheque was issued at the time of purchase of tractor during the year 2001. But the cheque is dated: 26-07-2003. Even the stamp paper on Hand loan deed (kaigad patra) is also of the year 2003 which is at Ex.P.7. The witnesses for complainant PW.2 Sidagondappa also corroborated the evidence of appellant/complainant. Therefore the learned trial court without appreciating the material on record and evidence has wrongly acquitted the accused. Even the suit is instituted by the complainant against the accused on the basis of Ex.P.7 in O.S. No.160/2006 for recovery of money before the I Addl. Senior Civil Judge which came to be decreed. Therefore the Judgment of 7 the trial court is bad in law. The evidence of DW.2 will not help the accused.
With these main grounds he has prayed to set aside the Judgment of acquittal and convict the accused.
10. Heard Sri.S.S.Mamdapur learned counsel for the appellant/complainant and Sri.Ravi G.Madbhavi learned counsel for accused/respondent.
11. The learned counsel for appellant argued that, the execution of cheque and promissory note i.e. hand loan deed is admitted by the accused. Suit is decreed on hand loan deed document is also admitted. There is evidence of PW.1 which clearly supports the document. Apart from that, Ex.P.7 came into existence only in the year 2003. Therefore, there is no question of creating of execution of such document in the year 2001. Ex.P.1 and Ex.P.7 are admitted by the accused. Legal notice endorsement clearly shows that, it is 8 refused. Said documents are not prior to purchase but they are subsequent to purchase. It is not the case of the accused that, it is forged document, nor he has set up such a defense nor it was sent for any expert opinion. The evidence of DW.2 is vague and general one. With these grounds the learned counsel for appellant prays to convict the accused.
12. As against this, the learned counsel for accused/respondent argued that, the accused has produced as many as nine documents. He has also maintained counter foil to prove to whom he has issued the cheque. It is evident from the cross-examination of DW.1 at para No.4 that this accused has filed complaint against him in similar set of facts. Even a case under section 420 Indian Penal Code was also registered against him. The conduct of the complainant/appellant in filing such cases may indicate that, he is in the habit of filing such cases or mis-using the cheque and bond 9 amount issued by the agriculturists who want to produce those cheques and those documents were misused by the complainant. Learned counsel further argued that, there is no proof regarding any legally enforceable debt outstanding or due by the accused. The accused has not taken any hand loan. DW.2 has also given evidence stating that, the complainant has taken even cheque and bond paper from him which are blank but not returned. So the conduct of the complainant in playing fraud on customers for purchase of tractor is evident. The trial court after considering all these aspects, both oral and documentary evidence rightly came to conclusion that, the complainant has failed to prove ingredients of section 138 of Negotiable Instrument Act. In support of his arguments learned counsel for accused relied upon decision of this court reported in 2018 (2) AKR 440 in case of Branch Manager, PCA & RD Bank Ltd Belthangady Vs Suresh Ganapath Das and argued that in similar set of facts this High 10 Court has acquitted the accused holding that, the complainant has failed to prove that there was any legally enforceable debt. With these contentions he prayed to dismiss the appeal.
The learned counsel for respondent has also filed written synopsis arguments in support of his case.
13. I have perused the Judgment of trial court, records of the trial court and appeal Memo.
14. From the above materials, evidence and arguments the point that would arise for my consideration are as under:-
01. Whether the learned trial court has appreciated the evidence before the court in the light of the sound principles regarding appreciation of evidence in cases arising out of 'Cheque Bounce" under Negotiable Instrument Act 1881"11
02. Whether the Judgment passed by the trial court in C.C. No.471/2005 dated:
17-09-2013 is illegal, perverse and needs interference by this court?
15. My answer to the above points is as under for the reasons given below.
16. The main contentions in this case are that, the accused has admitted the issuance of cheque. It is also undisputed that the accused has purchased a tractor from M/s Rajashree Agro Services Ltd. Bijapur and the complainant was the proprietor of the said agency. It is also not disputed that, in the month of January 2001 accused approached the complainant for purchase of Mahindra Tractor and accused states that for that purpose he handed over a blank bond paper and a cheque on the condition that after receipt of the said tractor price the same shall be returned to him.
According to the defense of the respondent/accused he 12 has repaid the amount but the cheque is not returned and it is misused by the complainant.
17. In view of these contention let me consider the evidence placed on record and Judgment of the trial court.
18. In order to prove his case the complainant got examined himself as PW.1. In his examination chief affidavit he has stated that, he was doing business of tractor and its spare parts and the accused was his friend he also purchased tractor. He used to take hand loan and return the same. He has further stated that, on 11-06-2003 the accused borrowed a sum of Rs.52,000/- for his family needs and repair charges of Tractor. So he paid the amount of Rs.52,000/- then accused voluntarily issued a post dated cheuqe 27-06- 2003 drawn on Bijapur Grameen Bank branch Aski Tq:
Sindagi bearing cheque No.0136305 for Rs.52,000/- as a security stating that, he will repay the amount within 13 one and half months and requested to present the said cheque on 26-07-2003. Accordingly he presented the said cheque but it was returned with endorsement as funds "insufficient". Complainant informed the accused in this regard, but the accused apologized for the same and assured that, he will pay the amount within one month but he did not pay the amount. So complainant issued legal notice on 28-11-2003, immediately within
15 days of receipt of the intimation from the Bank. The said notice was refused by the accused. So he filed a complaint within one month. He has produced Ex.P.1 cheque, Ex.P.2 is the Bank endorsement dated: 17-11- 2003, Ex.P.3 is the legal notice, Ex.P.4 is the postal receipt and Ex.P.5 is the postal cover returned with endorsement "refused". Then he has lodged this complaint.
19. So the initial burden of filing the complaint in accordance with Sections 138(a) (b) & (c) of the Negotiable Instrument Act 1881 is complied. 14
20. In the cross-examination he has denied that, in a Arjun Mahindra Tractor Company selling scheme there is a procedure to give the tractor first then after the loan is sanctioned to him he has to pay the amount of tractor and at the time of purchase of tractor he has to give a bond and blank cheque for the security of the same, he has denied it. He has denied a suggestion that, the accused has executed the said cheque on 31-01-2001 and bond on that day, he has denied it. PW.1 has also stated that the accused has already paid the tractor purchase amount on 30-05-2001 but he has denied a suggestion that, he informed accused that the cheque and bonds are missing. So many suggestions were made to complainant-PW.1 but all are denied. PW.1 also admitted that, for recovery of the bond amount he has filed a suit in O.S. No.160/2006 before the I Addl. Civil Judge (Sr.Dn.) Court Bijapur in respect of said cheque amount. So there is nothing in his cross- examination so as to disbelieve his evidence. 15
21. To corroborate his evidence the complainant got examined one Siddagondappa as PW.2 who was the bond writer of that Hand loan Bond Ex.P.7. PW.2 has stated that, on 11-06-2003 as stated by accused he has written a bond paper as per Ex.P.7(kaigada patra). PW.2 has identified his signature and also signature of accused as per Ex.P.7(c) & (d). PW.2 has also stated that other two witnesses have signed and one of the witness has put his thumb impression. He has also stated that, after writing Ex.P.7 hand loan deed, he has readover the same to the accused. This witness was cross-examined at length but nothing is elicited in his cross-examination so as to disbelieve his evidence. So his evidence corroborates the evidence of PW.1. Ex.P.7 is certified copy of the bond paper which is issued from the State Bank of Mysore branch Bijapur on 05-06- 2003 for Rs.100/-. On perusing Ex.P.7 hand loan deed, it is evident that, it was not all in existence in the year 2001 as contended by the accused. The Ex.P.7 clearly 16 indicates that, the accused has borrowed hand loan of Rs.52,000/- for his personal necessities and tractor repair and he has issued the cheque bearing No.0136305 for Rs.52,000/- dated: 26-07-2003 stating that he will repay the amount and he will take back the cheque. Accused also acknowledged the receipt of the amount in the presence of witnesses. This totally falsifies the contention of the accused that he has given that bond paper in the year 2001 when it was not at all in existence in the year 2001. There is seal regarding on which date the said bond paper was purchased. It is on 05-06-2003.
22. Therefore both the documentary and oral evidence adduced by the complainant coupled with the presumption arising under section 118 and 139 of the Negotiable Instrument Act 1881 clearly indicates that, the complainant has discharged the initial burden on him to show that, the accused has issued the cheque by 17 for Rs.52,000/- and the said cheque was issued for existence of legally enforceable recoverable debt and liability. This proposition of law is clearly stated by the Hon'ble Supreme Court in a decision reported in AIR 2010 SC 1898 Rangappa Vs Mohan which has referred its earlier decision in case of Krishna Janardhan Bhat Vs Dattatraya G. Hegde reported in AIR 2008 SC 1325 it is held at para No.14 as under:
14. In light of these extracts, we are in agreement with the respondent-claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat (supra) may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant. Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the 18 offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused/defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under Section 139, the standard of proof for doing so is that of `preponderance of probabilities'. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own.
23. The Hon'ble Supreme Court in a decision reported in 2019 (10) SCC 287 in case of Uttam Ram vs. Devinder Singh Hudan and another wherein at para 25 held as under:
"25. In other judgment reported as Rohitbhai Jivanlal Patel v. State of Gujarat and Another this Court held as under:
"15. So far the question of existence of basic ingredients for drawing of presumption under Sections 118 and 139 the NI Act is concerned, apparent it is that 19 the appellant-accused could not deny his signature on the cheques in question that had been drawn in favour of the complainant on a bank account maintained by the accused for a sum of Rs. 3 lakhs each. The said cheques were presented to the Bank concerned within the period of their validity and were returned unpaid for the reason of either the balance being insufficient or the account being closed. All the basic ingredients of Section 138 as also of Sections 118 and 139 are apparent on the face of the record. The Trial Court had also consciously taken note of these facts and had drawn the requisite presumption. Therefore, it is required to be presumed that the cheques in question were drawn for consideration and the holder of the cheques i.e., the complainant received the same in discharge of an existing debt. The onus, therefore, shifts on the appellant-accused to establish a probable defence so as to rebut such a presumption." xxx xxx
17. On the aspects relating to preponderance of probabilities, the accused has to bring on record such facts and such circumstances which may lead the Court to conclude either that the consideration did not exist or that its non-existence was so probable that a prudent man would, under the circumstances of the case, act upon the plea that the consideration did not exist. This Court has, time and again, emphasized that though there may not be sufficient negative evidence which could be brought on record by the accused to discharge his burden, yet mere denial would not fulfil the requirements of rebuttal as envisaged under Section 118 and 139 of the NI Act.....
xxx xxx xxx
22. The result of discussion in the foregoing paragraphs is that the major considerations on which the Trial Court chose to proceed clearly show its fundamental error of approach where, even after drawing the presumption, it had proceeded as if the complainant was to prove his case beyond 20 reasonable doubt. Such being the fundamental flaw on the part of the Trial Court, the High Court cannot be said to have acted illegally or having exceeded its jurisdiction in reversing the judgment of acquittal. As noticed hereinabove, in the present matter, the High Court has conscientiously and carefully taken into consideration the views of the Trial Court and after examining the evidence on record as a whole, found that the findings of the Trial Court are vitiated by perversity. Hence, interference by the High Court was inevitable; rather had to be made for just and proper decision of the matter."
So in view of the principles stated in the above decision the burden shifts on the accused to rebut the presumption available under section 139 of the Negotiable Instrument Act.
24. The accused can rebut the presumption by two ways one by cross-examining the complainant and the other is by leading his defense evidence.
25. The object of bringing Section 138 on statute appears to be to inculcate faith in the efficacy of banking operations and credibility in transacting business on negotiable instruments. Despite civil remedy, Section 138 intended to prevent dishonesty on 21 the part of the drawer of negotiable instrument to draw a cheque without sufficient funds in his account maintained by him in a bank and induces the payee or holder in due course to act upon it. Section 138 draws presumption that one commits the offence if he issues the cheque dishonestly.
26. A statutory presumption has an evidentiary value, the question as to whether the presumption stood rebutted or not, must, therefore be determined keeping in view the other evidence on record. So if the accused is able to raise a probable defense which creates doubt about the existence of legally enforceable debt or liability the prosecution can fail. So the burden is on the accused to rebut the presumption.
27. As already stated there is nothing in the cross-examination of the complainant or his witness to show that the case of the complainant is not true or it is 22 a false case. On the other hand, the oral evidence of complainant is corroborated by documentary evidence.
28. Now the defense evidence is to be considered whether the statutory presumption and evidence of complainant is rebutted. Accused himself got examined as DW.1. In his examination-in-chief affidavit he has admitted about the purchase of the tractor from the agency where the complainant was the proprietor. So that indicates the accused knew the complainant. He is not a stranger. He has denied receipt of Rs.52,000/- and execution of cheque and the bond. He has also stated that, he has not received any notice which has come to his address.
29. In further examination he states that, when he went to complainant to enquire about the price of tractor and conditions for selling on 02-01-2001 the complainant informed him that till the loan is sanctioned from Bank, a bond paper and a cheque, both 23 signed shall be handed over to him and he will hand over the vehicle. DW.1 /accused again deposes that on 31-01-2001 again he approached the complainant and handed over a blank bond paper which was purchased at Bijapur from stamp vendor and a blank cheque drawn on Grameen Bank Aski branch both signed by him. But the present bond paper before the court is forged bond paper. Again accused deposed that, on 24- 05-2001 after sanction of the loan he paid the entire amount of the tractor to the complainant. Thereafter accused asked complainant to return the cheque the complainant informed him that it was misplaced. The complainant did not return the cheque so he kept quite. This type of evidence cannot be believed. It is not that the accused is not knowing the Bank transaction. He frequently met the complainant. He borrowed loan from Bank. That itself shows he is in acquaintance with bank transaction, cheque transaction and accused knew very well the complainant.
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30. Accused/DW.1 further admits that, on 13-12-2003 a postman brought the postal cover to his house and enquired his wife, but his wife refused to receive the same as her husband is not in the house, the post man has taken it back. On enquiry with the complainant, accused came to know that it was a demand notice alleging that he has taken hand loan of Rs.52,000/-
31. It is very pertinent to note that, the postal cover with the demand notice was sent to the address of accused. It was refused according to accused by his wife refused. But he came to know that it was a demand notice for Rs.52,000/- and a cheque and enquired with complainant but he did not reply the notice. Therefore an adverse inference will have to be drawn against the accused for not replying the said notice. The accused further deposes in his examination in-chief that he approached the complainant with some elderly person 25 and demanded the cheque and bond paper, but the complainant refused to return them unless he pays Rs.52,000/-. But accused has not examined any such elder person whom he has state to have taken to the complainant. Accused did not take any steps when he came to know about the cheque and bond amount and demand notice. Simply stating that he has not borrowed the amount and the complainant has taken disadvantage of bond paper and cheque issued in the year 2001 will not help the accused. Therefore on entire reading of his examination-in-chief that will clearly indicate that, the accused has totally failed to rebut the presumption.
32. In the cross-examination, accused admitted that his address as shown on the refused postal cover is same. Further he has admitted the signature on Ex.P.1 cheque, but denied the signature on Ex.P.7/"Hand Loan Bond". Accused has also admitted that, when he has issued the cheque Ex.P.1 there was no amount in his 26 account. That also corroborates the complainant's contention. Accused also admits that when the cheque was dishonored the complainant asked him the cheque amount by issuing notice. So sending of demand notice by complainant to his address is also admitted. Accused has also admitted that he never asked the complainant in writing to return the cheque and bond paper, nor he has issued any notice to him. Accused has also admitted that, his cheque book is lost but he has not given any complaint to the police. So his evidence clearly indicates that, somehow he want to escape the liability.
33. The accused subsequently has produced a counter foil of the cheque book that itself shows accused somehow try to evade liability. Accused has produced the RC book of his vehicle and R.C. book of vehicle of Mr.Hemaraddi as Ex.D.5 and Ex.D.6 and Judgment in Criminal Case No.838/2004 on the file of J.M.F.C. I Court at Bijapur as per Ex.D.7, F.I.R as per 27 Ex.D.8. These documents will not help the accused in any way. Because accused has admitted in the cross- examination that earlier he has stated the Cheque Book Ex.D.4/counter foil was lost. The Ex.D.4(a) the counter foil in respect of the said cheque there is no mention that it was a blank cheque. Even the writing of first foil and some other of Ex.D.4 are with the some amount. The next counter foil dates appears to have been over - written and they all appears to be written on the same day. The counter foil book was with the accused only. He can write what-ever he likes. If at all he has issued cheque with the amount mentioned in them to the persons shown in those counter foils he should have produced the Bank statement to show that, actually those cheques were issued in favour of the persons whose names mentioned in counter foil with the amount mentioned in it. But no such bank statement showing encashment of any such cheques with the amount mentioned in them is forthcoming. It appears that the 28 trial court has also mislead by this document and wrongly considered its evidentiary value.
34. DW.2 is one Hemaraddi. He states in his evidence that, he has also purchased the tractor from complainant agency. He has asked the tractor seller to return the cheque and bond paper. But the said cheque and bond paper was not signed by him. DW.2 has stated that, the complainant has not filed any cheque bounce case against him. DW.2 has clearly stated that, he do not know whether accused has borrowed Rs.52,000/- in the year 2003 by executing a cheque for return of the said amount. He has expressed his ignorance in this regard. DW.2 has clearly admitted that, he do not know as to what was the agreement between accused and complainant. So the evidence of this witness in fact falsify the defense of the accused that, the complainant was in the habit of misusing the cheques and bond papers. If at all the complainant was a person who misuses cheque and bond paper as stated 29 by accused the complainant could have very well filed a cheque bounce case against this DW.2 also. But no such cases were filed against this DW.2. He do not know anything about accused transaction with complainant.
35. The accused has produced certified copy of one Judgment in C.C. No.838/2004 on the file of J.M.F.C. I Court Bijapur dated: 04-04-200. The cause title indicates this complainant had filed a case against one Lal Basha Badiger for the offences punishable under sections 138 & 140 of the Negotiable Instrument Act and under section 420 of Indian Penal Code that Judgment is at Ex.D.7. On perusing the same it is evident that, the case was in respect of purchase Rotravetor (spare parts of tractor) worth of Rs.85,000/- on credit basis. There as the complainant was not able to produced the evidence, accused was acquitted. Simply because one case of the complainant under section Negotiable Instrument Act is dismissed, that 30 doesn't mean that any other case filed by the complainant under that section is also liable to be dismissed. No such presumption is there under law.
36. Ex.D.8 is the certified copy of F.I.R. filed on 31-01-2005 before Adarsh Nagar police station Bijapur under Crime No.72/2005 for the offence punishable under section 420 of Indian Penal Code. The said Ex.D.8 indicates that, on the basis of complaint lodged by one Sunil against one H.K Allapur and Ashok Salimath the said FIR is registered. The gist of the allegation mentioned at that, the accused after purchasing the Mahindra Tractor from Mahindra Finance for Rs.27,000/- as a loan did not repay the installments and return the R.C. In what way that FIR is connected with the accused is not forthcoming. It is in no way connected with the accused.
37. Therefore on reading of the entire evidence of complainant and accused it is evident that, the accused has miserably failed to rebut statutory presumption. 31
38. It is crystal clear that, the accused has issued Ex.P.1 cheque signed by him and failed to prove that it was issued in the year 2001. Ex.P.7 Hand Loan Bond paper came into existence on 05-06-2003. The legal notice sent by complainant to the accused by RPAD which is at Ex.P.5 though admitted by the accused that it came to his address and his house but it was refused. Even after coming to know abound demand notice sent by complainant no reply was given by the accused. The scribe of hand loan deed Ex.P.7 is examined. In the cross-examination of PW.2 nothing is elicited to disbelieve his evidence. If at all there was any forgery of signature of accused on Ex.P.7 as contended by the accused he should have sent the said document for handwriting expert opinion. When a person takes defense of fraud and forgery the burden is on him to prove the same. But the accused has not proved his contention regarding fraud or forgery. The evidence of accused and his witness failed to rebut the presumption 32 arising under the Negotiable Instrument Act. The decision relied by the accused reported in 2018 (2) AKR 440 in case of Branch Manager, PCA & RD Bank Ltd. Belthangady V Suresh Ganapathi Das will not help the accused in any way. In this case, the complainant is not a Bank, nor he maintains any account extract or loan account of the accused in any such natural business or transaction. The facts of that case are totally different and they have no bearing on the question involved in this case. The synopsis filed by the learned counsel is of no assistance to show that, accused has rebutted the presumption under Negotiable Instrument Act. The learned counsel contended that, the original of Ex.P.7 Hand Loan Bond is not produced in this case. Such argument is not tenable, as admittedly the original of Ex.P.7 is produced before the civil suit filed before the civil court on O.S. No.160/2006 wherein the complainant in this case has filed suit for recovery of the amount mentioned in the cheque and produced 33 Ex.P.7 original. The certified copy of the same is produced in this case. It is not disputed by the accused that, the said suit is also now decreed.
39. In view of section 20 of Negotiable Instrument Act, when once a person signs and delivers an negotiable instrument, the person signing shall be liable upon such instrument. So the contention that the cheque was issued blank cheque does not hold good in view of section 20 of Negotiable Instrument Act. The Hon'ble Suprme Court recently in Bir Singh Vs Mukesh reported in 2019 (4) SCC 197 held that "the cheque duly signed and voluntarily made over to payee, was in discharge of debt or liability arises irrespective of whether the cheque was post dated or blank cheque for filling by payer or any other person in the absence of evidence of undue influence or coercion".
40. Therefore it is evident that the complainant has proved beyond all reasonable doubt that, the accused has borrowed Rs.52,000/- as a hand loan and 34 executed Ex.P.1 cheque for discharge of that debt or liability. He has further proved that, the said debt was legally recoverable/enforceable debt or liability. Inspite of issuance of demand notice by the complainant after dishonor of the cheque, the accused failed to repay the said amount, thereby committed offence punishable under section 138 of Negotiable Instrument Act. The accused has failed to rebut the said evidence and statutory presumption arising in favour of complainant by any legally admissible evidence.
41. I have perused the Judgment of the trial court. In fact the trial court has not raised the proper points for consideration which arise while deciding the criminal case under section 138 of the Negotiable Instrument Act, 1881. Though the learned Magistrate stated that Ex.P.1 cheque is not disputed by accused, but the trial court has wrongly observed at para No.13 of the Judgment that the complainant has not produced any document in respect of earlier transaction with the 35 accused. Why the complainant should produce the documents in respect of any other transaction when he has not admitted that, he has got any other such documents or transaction with accused. Nothing worth elicited in the cross-examination of this PW.1. Without properly discussing the evidence placed by the complainant and without appreciating it on the sound principles regarding appreciation of evidence in Negotiable Instrument Act cases and not considering the statutory presumption arising in favour of the complainant the trial court has wrongly held that, the evidence adduced by the complainant cannot be accepted. Such observation has no legal basis. It is very strange that at para No.15 of the Judgment the trial court observed that, Ex.D4 the counter foil reveals the name of the persons to whom the cheques were issued by the accused. Further observed at para No.16 that counter foil is maintained by the accused in regular course of his business, so it is relevant and can be 36 relied upon. Such a finding at para Nos.15 & 16 has not legal basis at all. The counter foil of any cheque will be with the person who has got cheque book with him. He can fill up whatever amount he likes and write whatever name he likes. That has no evidentiary value at all. It is not an account book or account extract maintained by the Bank or other financial agency in their day to day regular course of business. That counter-foil would have some meaning if the accused should have produced his Bank account extract to show whether he has issued the cheque on the date mentioned in the counter foil to the persons mentioned in it on that particular date. In the absence of any such evidence the finding of the trial court is totally wrong. The trial court was mislead regarding the evidentiary value of Ex.D.4. Further the trial court without there being any evidence which could help the accused to rebut the presumption wrongly considered the evidence of DW.2 which was vague and general. The trial court without any basis wrongly held 37 that, the evidence of DW.2 establishes that the complainant was in the habit of taking the cheque and bond paper prior to selling of tractor to customers. There is no iota of evidence to show that aspect.
42. The reasoning of the trial court in respect of Judgment in certified C.C. No.838 of 2004/Ex.D.7 and FIR/Ex.D.8 are totally illegal. As already discussed the FIR has no connection. Ex.D.7 never indicates that, the complainant use to file a false complaint. Such imaginary observation without there being any basis is liable to be struck down. The observation of the trial court regarding Ex.P.7 that its original is not produced is not correct when original is produced before the civil court in a suit between complainant and accused. It is admitted that a suit is filed on the basis of Ex.P.7 original bond amount for the cheque amount as shown in the bond. The certified copy of the original bond is produced in this case. The production of original in a suit between accused and complainant in O.S. 38 No.160/2006 is not disputed. In fact the said suit is now decreed after full fledged trial before the civil court which further strengthens the presumption in favour of the complainant. Mis-interpreting the evidence of PW.2, without properly reading the evidence, ignoring the presumption arising under section 139 of Negotiable Instrument Act and without considering the sound principles regarding appreciation of evidence in a cheque bounce case the trial court has wrongly come to the conclusion based on Ex.D.4 counter foil and vague and general evidence of DW.2. Finding that the defense taken by the accused is probable and conclusion that the complainant has failed to prove the case beyond reasonable doubt is without any reasons. This finding of the trial court is perverse, illegal and not based on sound principles regarding appreciation of evidence in a cheque bounce case. The learned trial court Judge has given gobye to the principles enunciated by this High Court and the Hon'ble Supreme Court regarding 39 appreciation of the evidence in cheque bounce case, raising presumption and rebutting the presumption. This has resulted in miscarriage of justice and perversity of the finding by the trial court.
43. Normally in a case arising out of the Judgment of acquittal by the trial court the appellate court will not interfere if there is no perversity in finding and if there is other view possible. But here the reasoning and the conclusion arrived by the trial Judge has totally resulted in miscarriage of justice and such a finding not based on an iota of evidence cannot sustain. When the complainant has proved his case beyond all reasonable doubt by leading oral and documentary evidence, when the statutory presumption is in his favour, when such presumption is further strengthen by a decree in a full fledged trial by a civil court in respect of the very same amount based on the original of Ex.P.7, when the accused failed to rebut any such 40 presumption then the Judgment of acquittal needs to be set aside.
44. It is crystal clear that, the accused has committed an offence punishable under section 138 of Negotiable Instrument Act and he needs to be sentenced accordingly.
45. Section 138 Negotiable Instrument Act, 1881 provides punishment both imprisonment which may extend two years or with fine which may extend to twice the amount of cheque, or with both.
46. The offences under negotiable instrument Act are regulatory offences intend to give sanctity to the negotiable instruments. Keeping in mind the settled principles regarding imposition of sentence in cheque bounce case, in my considered view the accused needs to be imposed the fine double the cheque amount. In this case the cheque amount is Rs.52,000/-. The case of the year 2003. Now we are in the end of the year 2020. So nearly seventeen years the case is pending. 41 Therefore, in my considered view the imposition of double the cheque amount as a fine is a proper sentence. Hence I answer the Points for consideration accordingly and proceed to pass the following:
ORDER Criminal Appeal filed U/Sec.378(4) of Code of Criminal Procedure by the appellant/complainant is allowed.
The Judgment and order of acquittal passed by II Addl. J.M.F.C. Bijapur in C.C.No.471/2005 dated:
17-09-2013 is hereby set aside.
The accused/respondent is hereby convicted for the offence punishable under section 138 of Negotiable Instrument Act 1881.
The accused/respondent is sentenced to pay a fine of Rs.1,04,000/- (Rupees One Lakh Four Thousand only) ( i.e. double the cheque amount of Rs.52,000/-
(Rupees Fifty-Two Thousand).
42
The accused/respondent shall deposit the fine amount within a period of 30 days from the date of this order, failing which he shall undergo simple imprisonment for a period of one year. If the fine amount is deposited, out of the fine amount a sum of Rs.1,00,000/- (Rupees One Lakh only) shall be paid to the appellant-complainant Sangayya as compensation under section 357 of the Code of Criminal Procedure, 1973. The remaining amount of Rs.04,000/- (Four Thousand only) shall be credited to the State account.
Send back the records of the trial court forthwith if any.
Sd/-
JUDGE MNS