Karnataka High Court
M/S. Sn Plastics vs M/S. Kothari International on 23 April, 2026
Author: V Srishananda
Bench: V Srishananda
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NC: 2026:KHC:22412
CRL.RP No. 931 of 2025
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 23RD DAY OF APRIL, 2026
BEFORE
THE HON'BLE MR. JUSTICE V SRISHANANDA
CRIMINAL REVISION PETITION NO. 931 OF 2025
BETWEEN:
1. M/S. SN PLASTICS
REP BY ITS PROP. MR. SURAJ,
2. MR. SURAJ
AGED ABOUT 46 YEARS
S/O. VASUDEV
PROPRIETOR,
M/S. S.N. PLASTICS,
BOTH ARE R/AT PLOT NO. S/133,
PHASE 3B, VERNA INDUSTRIAL ESTATE
NEAR HP GAS GODOWN, VERNA,
GOA - 403 712.
...PETITIONERS
(BY SRI. ABHILASH R., ADVOCATE)
Digitally AND:
signed by
MALATESH 1. M/S. KOTHARI INTERNATIONAL
KC
REP BY ITS PROP
Location:
HIGH MR. PRADEEP KOTHARI
COURT OF AGED ABOUT 37 YEARS,
KARNATAKA
OFFICE AT NO. 92,
GROUND FLOOR, 2ND MAIN ROAD,
LINK ROAD, SESADRIPURAM,
BENGALURU - 560 020.
...RESPONDENT
(BY SRI. H. RAJANNA, ADVOCATE FOR
SRI. JAIRAJ G., ADVOCATE)
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NC: 2026:KHC:22412
CRL.RP No. 931 of 2025
HC-KAR
THIS CRL.RP IS FILED U/S 397 R/W 401 CR.P.C (U/S 438
R/W 442 BNSS) BY THE ADVOCATE FOR THE PETITIONER
PRAYING THAT THIS HONOURABLE COURT MAY BE PLEASED
TO SET ASIDE THE ORDER DATED 20.02.2025 BY THE HONBLE
LXVI ADDL. CITY CIVIL AND SESSIONS JUDGE (CCH-67) IN
CRL.A.NO.677/2023 CONFIRMING THE JUDGEMENT PASSED
DATED 27.04.2023 IN CC.NO.27426/2018 BY THE HONBLE XV
ACMM, BANGALORE CITY AND ACQUIT THE ACCUSED/
REVISION PETITIONER FOR THE OFFENCE P/U/S 138 OF N.I.
ACT, 1881 CONSEQUENTLY.
THIS PETITION, COMING ON FOR ORDERS, THIS DAY,
ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE V SRISHANANDA
ORAL ORDER
1. Heard Sri. Abhilash R., learned counsel for the petitioner and Sri. Rajanna H. for Sri. Jairaj G., learned for the respondent.
2. The accused, who suffered an order of conviction in CC No.27426/2018 for the offence punishable under Section 138 of the Negotiable Instruments Act, confirmed by the First Appellate Court in Criminal Appeal No.677/2023, is the revision petitioner.
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3. Facts in the nutshell which are utmost necessary for disposal of the present petition are as under:
3.1 A private complainant under Section 200 of the Code of Criminal Procedure came to be lodged with the jurisdictional Magistrate alleging the commission of the offence punishable under Section 138 of the Negotiable Instruments Act by contending that, complainant is a proprietorship concern, engaged in the business of sales of plastics and dealers in plastic preforms.
3.2 Accused being the customer of the complainant, placed orders and as per the orders placed by the accused for supply of the plastic pre-forms, raising invoices.
Accused acknowledged the receipt of all the articles and invoice amount was to the tune of Rs.16,85,205.20 as per the invoices dated 18.12.2017 and 26.02.2018. Out of the total sums of Rs.16,85,205.20, accused paid a sum of Rs.6,50,000/- to the complainant and balance was to the -4- NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR tune of Rs.10,35,205.20. The accused has issued a cheque No.358022 on 19.06.2018 in a sum of Rs.8,10,223.40, drawn on Indian Overseas Bank, Cortalim Branch, North Goa towards the outstanding amount which on presentation came to be dishonored with an endorsement 'funds insufficient'.
3.3 Complainant got issued a legal notice which was duly served on the accused. There was no compliance to the callings of notice and an untimely reply came to be issued. As such, complainant sought for action against the accused.
3.4 Learned Trial Judge after completing the necessary formalities summoned the accused and recorded the plea. Accused pleaded not guilty. Therefore trial was held.
3.5 In order to bring home the guilt of the accused, complainant got examined himself as PW1 and placed on record twelve documents which are exhibited and marked -5- NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR as Exhibits P1 to P12 comprising of dishonored cheque, bank endorsement, office copy of the legal notice, postal receipts and postal acknowledgments, reply notice, GST invoices and ledger account extract.
3.6 Detailed cross-examination of PW1 did not yield any positive material so as to disbelieve the case of the complainant.
3.7 Thereafter, accused got examined himself as DW1 and placed on record four documents which are two acknowledgments and bank statements marked as Exhibits D1 to D4.
3.8 Learned Trial Magistrate thereafter heard the arguments of the parties in detail and on cumulative consideration of the oral and documentary evidence on record, convicted the accused inter-alia holding in paragraphs No.20 to 24 as under:
20. The cheque and signature are admitted and it is admitted that the cheque is issued in favour of the complainant as security. The presumptions U/s. 139 and -6- NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR 118 of NI Act arise in favour of the complainant and operate until rebutted. Such being the case, the burden is on the accused to prove his defence. The accused took defence of repayment of loan by way of cash but failed to prove the same. It is the defense of the accused that there is no liability as alleged in the complaint and the complainant misused the security cheque. The counsel for the accused made several suggestions but the suggestions are denied by the complainant. Mere suggestions are not sufficient. On perusal of the entire cross examination of PW.1 nothing was elicited in support of the defence of the accused. The drawer's signature on the cheque attracts the ratio laid down by the Hon'ble Supreme Court of India in its decisions reported in 2011 (11) SCC - 441 - Rangappa V/s.Sri.Mohan and SCC 2015 (8) Page No.378 - T.Vasanthakumar V/s.Vijayakumari and the recent 29 CC.27426/2018( J) Judgment delivered in Crl. Appeal No.508/2019 - Rohit Bhai Jeevanlal Patel V/s. State of Gujarath and another. The ratio is that the cheque shall be presumed to be for consideration unless and until the court forms a belief that the consideration does not exist or considers the non-existence of consideration was tenable that a prudent man would under no circumstances act upon the plea that the consideration does not exist.
21. The accused argued that the cheque was given as security and it was not meant to be presented for encashment. The complainant misused the cheque by filling it up. The security cheque does not attract the offence punishable u/sec.138 of N.I Act. The counsel for -7- NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR the complainant argued that even the security cheque also attracts the offence punishable u/sec.138 of N.I Act. The Hon'ble Supreme Court of India in its recent decision in the case of Sripathi Singh (Since deceased) through his son Gourav Singh Vs. State of Jharkhand and Anr in Crl.A.No.1269-1270 of 2021 arising out of SLP (Crl) No. 252253 of 2020 dated 28.10.2021 reported in Live Law 2021 SC 606 held as under;
16. A cheque issued as security pursuant to a financial transaction cannot be considered as a worthless piece of paper under every circumstance. 'Security' in its true sense is the state of being safe and the security given for a loan is something given as a pledge of payment. It is given, deposited or pledged to make certain the fulfilment of an 30 CC.27426/2018( J) obligation to which the parties to the transaction are bound. If in a transaction, a loan is advanced and the borrower agrees to repay the amount in a specified timeframe and issues a cheque as security to secure such repayment; if the loan amount is not repaid in any other form before the due date or if there is no other understanding or agreement between the parties to defer the payment of amount, the cheque which is issued as security would mature for presentation and the drawee of the cheque would be entitled to present the same. On such presentation, if the same is dishonoured, the consequences contemplated under section 138 and the other provisions of N.I.Act -8- NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR would flow. 17. When a cheque is issued and is treated as 'security' towards repayment of an amount with a time period being stipulated for repayment, all that it ensures is that such cheque which is issued as 'security' cannot be presented prior to the loan or the installment maturing for repayment towards which such cheque is issued as security. Further, the borrower would have the option of repaying the loan amount or such financial liability in any other form and in that manner if the amount of loan due and payable has been discharged within the agreed period, the cheque issued as security cannot thereafter be presented. Therefore, the prior discharge of the loan or there being an altered situation due to which there would be understanding 31 CC.27426/2018( J) between the parties is a sine qua non to not present the cheque which was issued as security. These are only the defences that would be available to the drawer of the cheque in a proceedings initiated under section 138 of the N.I. Act. Therefore, there cannot be a hard and fast rule that a cheque which is issued as security can never be presented by the drawee of the cheque. If such is the understanding a cheque would also be reduced to an 'on demand promissory note' and in all circumstances, it would only be a civil litigation to recover the amount, which is not the intention of the statute. When a cheque is issued even though as 'security' the consequence flowing therefrom is also known to the -9- NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR drawer of the cheque and in the circumstance stated above if the cheque is presented and dishonoured, the holder of the cheque/drawee would have the option of initiating the civil proceedings for recovery or the criminal proceedings for punishment in the fact situation, but in any event, it is not for the drawer of the cheque to dictate terms with regard to the nature of litigation.
As per the above decision, it is very much clear that security cheque also attracts the provision u/sec.138 of N.I Act and it is to be seen that whether there is any legally enforceable debt as on the presentation of the cheque. In the case on hand, the Ex.P9 and 10 and Ex.D3 and 4 and the admissions of the accused clearly show that there is liability of Rs.9,35,205/-. Therefore there is 32 CC.27426/2018( J) legally enforceable debt as on the date of presentation of cheque. Even though the cheque at ExP.1 is issued for security of amount of raw material supplied, it attracts the provision U/s. 138 of NI Act.
22. The accused argued that he issued the cheque but it was for security of the transaction and he paid Rs.7,50,000/- to the complainant as per Ex.D4 and 5. He relied on the judgment of Hon'ble Supreme Court of India in the case of Dasharathbhai Trikambhai Patel Vs. Hitesh Mahendrabhai Pate and Anr. In Crl.A.No.1497 of 2022
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR dated 11.10.2022 reported in 2022 LiveLaw (SC) 830, wherein it was held as under;
When a part-payment of the debt is made after the cheque was drawn but before the cheque is encashed, such payment must be endorsed on the cheque under section 56 of the Act. The cheque cannot be presented for encashment without recording the part payment. If the unendorsed cheque is dishonoured on presentation, the offence under section 138 would not be attracted since the cheque does not represent a legally enforceable debt at the time of encashment.
For the commission of an offence under section 138, the cheque that is dishonoured must represent a legally enforceable debt on the date of maturity or presentation. If the drawer of the cheque pays a part or whole of the sum between the period when the cheque 33 CC.27426/2018( J) drawn and when it is encashed upon maturity, then the legally enforceable debt on the date of maturity would not be the sum represented on the cheque. When a part or whole of the sum represented on the cheque is paid by the drawer of the cheque, it must be endorsed on the cheque as prescribed in Section 56 of the Act. The cheque endorsed with the payment made may be used to negotiate the balance, if any. If the cheque that is endorsed is dishonoured when it is
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR sought to be encashed upon maturity, then the offence under section 138 will stand attracted.
As per the above judgment the part or whole payment must have been made during the period between the drawing of the cheque and the presentation of the cheque for encashment. If any such payment is made, it should be endorsed on the cheque. If endorsement is not made and the cheque is presented for encashment, then the offence U/s.138 of NI Act is not attracted as there is no legally enforceable debt as on date of presentation of cheque for encasement. In the case on hand, Ex.P9 and 10 and Ex.D3 and 4 and the admissions of the accused clearly show that there is liability of Rs.9,35,205/-. Therefore there is legally enforceable debt as on the date of presentation of cheque. The cheque is dated 19.06.2018. As per the provision u/sec.118(b) of N.I Act, it shall be presumed that the cheque was made or drawn on the date mentioned in it until the contrary is proved. The 34 CC.27426/2018( J) burden is on the accused to prove the same. The accused failed to prove it. The accused made payment lastly on 08.05.2018. There is no payment after the date of the cheque. Therefore the judgment relied on by the accused is not attracted to the case in hand.
23. It is the defence of the accused that he issued signed blank cheque as security at the time of Ex.P9. On perusal of cheque, it is found that the signature and the contents are written with same ink and only the date in the cheque is written in different ink. However even if the
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR blank signed cheque was given and it was filled up later, it attracts the ingredients u/sec.138 of N.I Act. As per Section 20 of the N.I.Act, if the person signs and delivers Negotiable Instrument and it is left incomplete and thereby he authorizes the holder to complete the Negotiable Instrument and thereby he is liable for the amount mentioned in the Negotiable Instrument. In the Judgment rendered by the Hon'ble Supreme Court of India in Bir Singh V/s.Mukesh Kumar reported in AIR 2019 SC 2446, it was held by the Hon'ble Apex Court that "If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence. Even a blank cheque leaf, voluntarily singed and handed over by the accused, which is towards some payment, would attract presumption under Section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show 35 CC.27426/2018( J) that the cheque was not issued in discharge of a debt." Therefore the blank signed cheque also attracts the provision U/s.138 of NI Act, if some amount due is shown. In the case on hand, the transaction as per Ex.P9 and 10 amounting to Rs.16,85,205/- is admitted. The complainant admitted repayment of Rs.7,50,000/- as per Ex.D4 and 5. The accused failed to prove taking of raw materials worth Rs.4,20,000/- by the complainant forcibly from his factory. Hence there is due amount of Rs.9,35,205/- and
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR the accused is liable. Therefore the defence of the accused is not tenable.
24. For the reasons mentioned herein above, it is crystallized that the accused has utterly failed to prove that there was no existence of legally enforceable debt/liability between him and the complainant and he has not at all issued the instant cheque towards the discharge of legally enforceable liability of Rs.8,10,223/-. On the other hand, the complainant has proved that the accused issued the cheque for the legally enforceable liability; the cheque was dishonored due to the reason 'Funds Insufficient' and the notice issued by him was served on the accused. The complainant proved his case beyond all reasonable doubts. The accused failed to rebut the statutory presumptions U/s.118(a) & (b) and 139 of the N.I.Act. Accordingly the accused is found guilty for the offence punishable U/s.138 of the N.I.Act. Hence, I proceed to answer the Point No.1 in Affirmative and Point No.2 in the Negative.
3.9 Being aggrieved by the same, accused filed an appeal before the District Court in Crl.Appeal No.677/2023.
3.10 Learned Judge in the First Appellate Court after securing the records, heard the arguments of the parties
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR in detail and thereafter dismissed the appeal of the accused by considered judgment dated 20.02.2025 inter alia, holding in paragraphs No.14 to 25 as under:
14. In the present case the accused has not disputed Ex.P1 cheque. The factum of dishonour due to "funds insufficient" is not in dispute. After the service of legal notice, accused has not repaid the amount within the period of limitation. Therefore the complainant has discharged the initial burden that 10 Cri.A.No.677/2023 was caste upon him and consequently it is for the accused to rebut the presumption under section 139 of N.I.Act and to show that the cheque in question was not issued towards any legally enforceable debt or liability. The accused is required to rebut the presumption not by plausible explanation but by cogent evidence in support of his defence.
15. The complainant in support of its case got examined its authorised representative Pradeep Kothari as PW.1 and produced Ex.P.1 cheque. Ex.P.2 is the endorsement which indicates that cheque was dishonoured for the reason funds insufficient. Ex.P.3 is the legal notice wherein the complainant called upon the appellant to pay the cheque amount. Ex.P.4 and 5 are the postal receipts, Ex.P.6 and 7 are the postal acknowledgments, Ex.P.8 is the reply notice, Ex.P.9 and 10 are the 2 GST Invoice and Ex.P.11 and 12 are Ledger account extract.
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR
16. In the cross examination it is elicited that as per Ex.P.11 and P.12 the accused had paid a sum of Rs.6,50,000/-. As per Ex.P.11 it indicates that the amount paid was Rs.5,50,000/-. The above suggestion indicates that there was business transaction between the complainant and the accused. As per Ex.P.9 GST Invoice dated 18/12/2017 the accused was due a sum of Rs.8,10,223/- and as per Ex.P.10 GST Invoice dated 26/2/2018 accused was due a sum of Rs.8,74,981/-. Ex.P.11 reflects the 11 Cri.A.No.677/2023 payment of Rs.5,50,000/-. As per the suggestion of the accused he has paid Rs.6,50,000/-. Therefore, the suggestion of the accused and the materials placed on record indicates that the accused is due to pay the balance amount to the complainant.
17. In support of its contention accused got examined himself as DW-1. In the examination in chief he has stated that the complainant had agreed to supply raw materials on credit basis. He placed order in the month of December 2017 for supply of raw materials. On 14/12/2017 he supplied the raw materials worth Rs.8,10,223/-. As a security the complainant demanded a blank signed cheque. The complainant had received a sum of Rs.7,50,000/- through RTGS and therefore, he is liable to pay a sum of Rs.60,223/- only. He has further contended that in the month of May 2018 the complainant demanded for payment of balance amount and when he sought time, complainant took the raw materials from his factory and supplied them to Balaji Foods amounting to Rs.4,00,000/-. But, during the cross examination DW-1
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR has admitted that he had purchased items worth Rs.8,10,223/- on 18/12/2017 and items worth Rs.8,74,981/- on 26/02/2018. He has also admitted that as per Ex.P.8 the total amount repaid is Rs.7,50,000/-. When 12 Cri.A.No.677/2023 the accused has categorically admitted having purchased Items worth Rs.8,10,223/- and Rs.8,74,981/- on different dates and repayment of only Rs.7,50,000/-, burden is upon the accused to prove that he had paid the remaining balance amount to the complainant by producing cogent evidence in proof of the same. The accused has not produced any materials to show that he has paid the amount to the complainant in excess of the admitted amount of Rs.7,50,000/-. Except the suggestion nothing is forthcoming to establish that amount was paid to the complainant as contended by the accused.
18. The accused has taken another contention to the effect that the complainant has taken back the raw materials amounting to Rs.4,20,000/- and supplied it to Balaji Foods. But, the accused has not produced any documents to show that the materials supplied to him was taken back by the complainant. Though it is stated that the complainant has forcibly taken back the raw materials, he has stated that he has not given any complaint to the police in connection with the same. If at all raw materials was taken back, the accused would have given complaint to the police or taken necessary legal action against the complainant. But, no such materials 13 Cri.A.No.677/2023 are placed before the Court to show
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR that complainant has taken back the raw materials as contended by the accused.
19. It is pertinent to note that the defence of the accused is not consistent. During the examination in chief of DW.1 it is stated that he is liable to pay Rs,60,223/-. But, in Ex.P.8 reply notice accused has stated that he is liable to pay a sum of Rs.5,07,423/-. Therefore, the accused is not sure as to what is the amount liable to be paid by him to the complainant. Therefore, the contention of the accused does not inspire the confidence of the Court to believe the defense taken by him.
20. It is pertinent to note that as per the version of the accused cheque was issued as a security. Even though cheque was issued as security, it would attract the provisions of section 138 of N.I. Act. Therefore the accused has to prove with cogent evidence that complainant has presented the cheque not for legally recoverable debt and the accused has failed to prove the same. The fact of issuance of cheque and the statutory presumption available in favour of the complainant is not rebutted by the accused.
21. At this juncture it is necessary to go through a ruling rendered by Hon'ble Apex Court reported in (2016) 10 SCC 458 14 Cri.A.No.677/2023 in the case of Sampelly Sathyanarayana Rao Vs. Indian Renewable Energy Development Agency Limited wherein it is held that a post-dated cheque described as 'security' in the loan agreement is dishonoured, the same would be punishable
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR under section 138 of Negotiable Instruments Act. Since the accused has taken a contention that he had issued the cheque as security, it indicates that there was existing liability on the part of the accused and accused issued the cheque in respect of the same. Under these circumstances the above ruling is squarely applicable to the facts of this case.
22. It is the case of the accused that complainant has misused the cheque. The burden is upon the accused to prove that cheque was misused by the complainant by producing cogent evidence. The accused was at liberty to take any legal action against the complainant if the cheque was misused. But, no such steps were taken by the accused alleging that cheque was misused by the complainant. He has categorically stated during the cross examination that she has not taken any legal action against the complainant alleging that he has misused the cheque. Therefore, there are no materials to substantiate the said contention of the accused. The available materials on record probabillises the case of the complainant. The accused has failed to raise a probable defence and also failed to rebut the presumption available in favour of the complainant. 15 Cri.A.No.677/2023
23. At this juncture it is worthwhile to go through a judgment reported in AIR (2010) 11 Supreme Court Cases 441, 1898, in the case of Rangappa Vs. Mohan, wherein by relying upon the ruling of Hithen P Dalal Vs. Bratheendranath Banerji, it is reiterated that once the accused admits his signature the legal presumption will
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR have to be raised in favour of the complainant. The accused can prove non-existence of a consideration by raising a probable defence. In the case on hand the accused has failed to raise probable defence.
24. In a proceeding under section 138 of N.I. Act it is for the accused to prove that cheque was not issued towards legally recoverable debt or liability. He has to lead credible evidence for rebuttal of this presumption. The presumption under section 139 of N.I.Act is a presumption of law, it is not the presumption of fact. This presumption has to be raised by the Court in all the cases. Once the factum of dishonour is established, the onus to rebut the presumption lies on accused and such evidence must be sufficient, cogent, and to be proved beyond all reasonable doubt. Therefore mere explanation is not enough to repel this presumption of law. In the present case the complainant has discharged his initial burden that the accused had issued the cheque in question in his favour and the same was dishonoured. He has also complied with the mandatory provisions prescribed by law. Such being the case, burden is caste on the accused to prove 16 Cri.A.No.677/2023 that the cheque was not issued towards any legally recoverable debt.
25. The cumulative effect of oral as well as documentary evidence produced by the complainant is that the accused has issued issued cheque bearing No.358022 dated 19/06/2018 for Rs.8,10,223.40 drawn on Indian Overseas Bank, Cortalim Branch, 2 nd Aravalli, Salcete, Pin 403714,
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR North Goa. When the cheque was presented by the complainant for encashment through his banker Canara Bank, Sheshadripuram Branch, Bengaluru same came to be dishonoured with shara 'funds insufficient' on 20/06/2018 and the accused has failed to make payment within stipulated period prescribed by law. Accordingly point Nos.1 and 2 are answered in the Affirmative.
4. Being further aggrieved by the same, accused has preferred this revision petition before this Court on following grounds:
That the order of conviction and dismissal of the appeal are both done by the respective Honorable Courts with haste and is contrary to the facts and circumstances of the case. The reasons assigned by the Honorable Courts are quite technical and against the possible perspectives of this cause of action. On detail analysis of the judgements, it can be clearly found that the available evidences are not adequately appreciated by the Honorable Courts.
That, the Honorable Courts didn't appreciate the evidence in hand. The Ex. P9 is a GST invoice that is for an amount of Rs 8,10,223.40/- dated 18-12-2017 against invoice no
204. The subject Cheque amount exactly matches with the said invoice and in ordinary prudence, it is evident that the subject Cheque was given as a guarantee against the said invoice dated 18-12-2017. Since the Cheque amount is squarely disproportionate with the enforceable liability, the judgements are liable to be set aside with immediate effect.
That, as appreciated by the Learned ACMM Court, Bangalore, the Petitioner herein had already paid an amount of Rs 7,50,000/-(as per Para 15 of the judgement
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR copy of Honorable ACMM Court Bangalore) as per the Ex. D3 & Ex. D4. Hence the actual amount due will be Rs 60,223.40/- to the Respondent. Though the respondent vehemently pleaded that the second business transaction as per invoice no 255 dated 26-02-2018, that is Ex. P10 is not completed yet, the Honorable Courts failed to appreciate the same. Hence this entire trial is based on an unfinished business intended to corner the Petitioner towards payment of unwarranted sum towards the illegal gratification of the Respondent. Hence the same is liable to be set aside.
That, it is the contention of the Respondent that the items. equivalent to Rs 8,74,981.80/- was delivered to the Petitioner as per Ex. P 10. The Honorable Courts have appreciated that as an evidence. There are no other evidences to support that the Respondent had paid the required GST taxes in the GST portal and the Petitioner had claimed the input tax credit against the same. Unless such additional evidences are adduced, there is no validity of an E-way bill which is not having any seal of acknowledgement from the Petitioner confirming the delivery of the items. In the cross examination of the Petitioner herein, it was clearly mentioned that in the second round of business with the Respondent, the Respondent had taken back the goods and hence there was a payment dispute. This entire procedure ensured that the business dispute between Petitioner and Respondent remained as it is and the Honorable Courts were made as the tools and system to extract the amounts from Petitioner. Hence the entire trial is liable to the quashed and the Petitioner is liable to be acquitted with immediate effect.
That, hence though the cause of action was rightfully admitted by the Honorable trial courts, the chance of rebutting the legitimate and enforceable debt was not given to the Petitioner and hence such proceedings lack parity and hence the orders of such proceedings are liable to be set aside.
The Petitioner crave the leave of this Honorable Court to urge additional grounds and additional documents if any at the time of hearing.
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR The Petitioner had not filed any other Petitions which are pending before any other courts nor this Honorable Court for seeking same relief.
5. Learned counsel for the petitioner reiterating the grounds urged in the revision petition would vehemently contend that both the Courts have not properly appreciated the material evidence on record and wrongly convicted the accused resulting in miscarriage of justice.
6. Counsel for petitioner would also contend that in respect of two transactions, total amount was Rs.16,00,000/-, of which sum of Rs.7,00,000/- and odd has been paid by the petitioner and therefore, only sum of Rs.60,000/- was due by the accused to the complainant which has not been properly appreciated and the cheque which was given as security at the time of the transaction has been misused by the complainant. As such, Exhibit P1 cheque did not carry any legally recoverable debt which has not been properly appreciated by both the Courts
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR which is a sine qua non to convict the accused under Section 138 of the Negotiable Instruments Act and sought for allowing the revision petition and dismissal of the complaint.
7. Per contra, Sri Rajanna learned counsel for the respondent complainant representing Sri Jairaj would support the impugned judgment.
8. Sri Rajanna would further contend that the liability of the petitioner is evident from the invoices and Goods and service tax has also been paid by the complainant in respect of the invoices and transaction is not in dispute.
9. He would further emphasize that it is the accused who has taken the contention that he has paid Rs.7,00,000 and odd as against Rs.16,85,205.20 due, was required to place on record necessary documents. But , he has paid the major portion of the invoice amount and only a sum of Rs.60,000/- was due.
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NC: 2026:KHC:22412 CRL.RP No. 931 of 2025 HC-KAR
10. It is further contended that Exhibits D1 to Exhibit D4 did not establish that only a sum of Rs.60,000/-
is due and therefore sought for dismissal of the revision petition.
11. Having heard the arguments of both sides, this Court perused the material on record meticulously.
12. On such perusal of the material on record, it is crystal clear that there were two transactions between the accused and the complainant vide Exhibits P9 and 10.
Account of the accused is maintained by the complainant in a ledger which is marked as Exhibit P11 and Exhibit P12.
13. Admittedly, cheque marked at Exhibit P1 belongs to the accused and signature found therein is that of the accused. Same is dishonored with an endorsement 'funds insufficient'.
14. Marking of the cheque, GST invoices, ledger extracts and the bank dishonoured note would be
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15. Pertinently, said presumption is rebuttable in nature. In order to rebut the presumption available to the complainant, accused got examined himself as DW1 and placed on record four documents. Among them Exhibit D3 assumes importance wherein payments made by the accused to the complainant is reflected. Likewise, in Exhibit D4, there is a payment of Rs.2,00,000/- by the accused to the complainant.
16. According to the accused, on taking note of these payments, there was only Rs.60,000/- due on behalf of the accused to the complainant and not Rs.8,10,223.40 as is contented on behalf of the complainant and cheque which was given as security has been misused by the complainant.
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17. Such a contention cannot be countenanced in law for more than one reason. Firstly, if it is the case of the accused that he has discharged the major portion of Rs.16,85,205.20, it is for him to establish the same by placing necessary evidence on record.
18. On perusal of the material on record, no such details are forthcoming to establish that accused has paid major portion of the sum of Rs.16,85,205.20 and he was only a due in a sum of Rs.60,000/-.
19. In his cross examination, he specifically admits that he has not issued any stop payment instructions to the bank in the period of 03.05.2018 to 08.06.2018.
20. However he has volunteered to say that he did not do so because he has given the said cheque as security.
21. In his cross-examination, he has also specifically admitted that he has purchased items worth
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22. He admits that as per Exhibit P8, only sum of Rs.7,50,000/- is received and balance sum of Rs.9,27,423/- was still due.
23. Witness has however has volunteered that complainant took back the materials from the factory and therefore balance sum is disputed.
24. According to him, raw materials which was taken back by the complainant to the tune of 3,000 kgs was amounting to Rs.4,20,000/-. To establish the same, there is no material on record.
25. In other words, when the accused has taken the burden of proving that he was not due in a summer of Rs.8,10,000/- he was required to establish the same by placing material evidence on record.
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26. No such material is forthcoming on record for having returned the 3,000 kgs of raw materials worth Rs.4,20,000.
27. Moreover, if it is the case of the accused, that the complainant has misused the cheque which was given as security being a businessman, accused was supposed to take necessary criminal action against the complainant. No such action is forthcoming. More so, when he had the services of an advocate.
28. Taking note of these aspects of the matter, the defence taken by the accused cannot be counted as in law.
29. Further, even if the cheque is issued as a security following the dictum of the Hon'ble Apex Court in the case of Sreepathi Singh versus State of Jharkhand reported in 2021 SCC Online SC 1002, complaint under Section 138 is Negotiable Instrument, Act is maintainable.
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30. Accordingly, this Court does not find any grounds whatsoever much less good grounds to admit the matter for further consideration.
31. Accordingly, following order:
ORDER
(i) Criminal Revision Petition is dismissed.
(ii) Amount in deposit is ordered to be withdrawn by the complainant under due identification.
Sd/-
(V SRISHANANDA) JUDGE SNC List No.: 2 Sl No.: 25