1 IN THE HIGH COURT OF KARNATAKA AT BANGALORE DATED THIS THE 9 TH DAY OF AUGUST 2012 BEFORE THE HON BLE MR JUSTICE K. N. KESHAVANARAYANA CRIMINAL APPEAL No.428/2006 (A) BETWEEN: Sri.M.Gopalappa, S/o Late Munivenkatappa, Aged 52 years, Residing at No.21/1, 3 rd Block East, 16 th A' Main, Jayanagar, Bangalore-560 047...Appellant (By Smt.G.R.Sujatha for M/s.R.S.B.G.Law Firm, Advocates) AND : Sri.M.D.Basavanna, Advocate, No.248/9, Saraswathi Nilaya, Venkatapura Main Road, Koramangala, Bangalore-560 034..Respondent (By M/s. T.Subramanya & Associates, Advocates) This Criminal Appeal is filed under Section 374 Cr.P.C by the advocate for the appellant/accused against the Judgment dated 27.12.2005 passed by the XXII Additional Chief Metropolitan Magistrate and XXIV Additional Small Causes Judge, Bangalore City in
2 C.C.No.36877/2002 and convict the respondent for the offence punishable under Section 138 of N.I.Act. This Criminal Appeal coming for hearing on this day, the court delivered the following: J U D G M E N T This appeal by the complainant in C.C. No.36877/2002 on the file of the XXII Additional CMM, Bangalore, is directed against the judgment and order dated 27.12.2005 passed in the said case acquitting the respondent/accused of the charge levelled against him for the offence punishable under Section 138 of the Negotiable Instruments Act ( for short, N.I. Act ). 2) The appellant filed a private complaint under Section 200 of Cr.P.C. alleging the offence punishable under Section 138 of the N.I. Act against the respondent/accused inter alia alleging that he was a longstanding client of the respondent, an Advocate by profession and he had entrusted several briefs to accused; that the accused availed hand-loan and towards the discharge of the legal liability, the accused issued a
3 cheque dated 10.03.2002 drawn on State Bank of Mysore, CBAB Complex Branch, Bangalore, for Rs.2,00,000/- (Rupees Two Lakhs) and when the said cheque was presented for encashment, the same was returned unpaid with the banker s endorsement Funds Insufficient ; that he immediately caused a legal notice on the accused informing him about the dishonour of the cheque and calling upon him to pay the amount covered under the cheque within the period allowed under law; that the respondent/accused, instead of complying with the demand made therein, caused an untenable reply and failed to pay the amount covered under the cheque within the statutory period. Thus, according to the complainant, the accused has committed the offence punishable under Section 138 of the N.I. Act. 3) The respondent/accused on his appearance before the learned Magistrate, pleaded not guilty for the accusation made against him and claimed to be tried.
4 4) In support of his case, the complainant examined himself as PW.1 by filing his examination-inchief by way of affidavit. As the accused failed to crossexamine the complainant in spite of grant of time, the learned Magistrate proceeded to examine the accused under Section 313 of Cr.P.C. and then disposed of the matter by convicting the accused. In the appeal filed by the respondent/accused, the judgment of conviction was set aside and the matter was remanded back to the trial Court for affording further opportunities to the parties. Thereafter, the complainant was cross-examined and the accused also examined himself as DW.1 and produced several documents. The defence of the accused was that, at no point of time he availed hand-loan from the complainant nor he issued the cheque in question for discharge of any debt due by him to the complainant. According to him, the complainant misusing his close acquaintance as a client and later as a family friend somehow managed to get possession of the cheque in question and misused the same. It was also his further defence
5 that the complainant had borrowed a sum of Rs.2,50,000/- from him on various occasions and in the month of April 2000 while taking back all the briefs entrusted to him, the complainant towards amount due by him, executed a promissory note in his favour dated 27.04.2000 and therefore, there was no occasion for him to issue the cheque dated 10.03.2002. 5) After hearing the counsels appearing on both sides and on assessment of oral as well as documentary evidence, the learned Magistrate by the judgment under appeal, acquitted the respondent/accused for the charge levelled against him. Aggrieved by the said judgment, the complainant is in appeal before this Court. 6) I have heard the learned counsel appearing for the appellant as well as the respondent and perused the records secured from the court below. 7) As could be seen from the judgment under appeal, the learned Magistrate noticing the following
6 circumstances namely, that neither in the notice issued under Section 138 of the N.I. Act nor in the evidence, the complainant has disclosed the date on which the alleged loan of Rs.2,00,000/- was advanced; that except the cheque in question, there is no other document to evidence the alleged lending of substantial amount of Rs.2,00,000/-; that the relationship between the complainant and the accused was that of a fiduciary capacity being the advocate and the client and the complainant having admitted his signature found on the promissory note in favour of the accused, has failed to substantiate the circumstances under which he said to have executed the promissory note, was of the opinion that the presumption under Section 139 of the N.I. Act stood rebutted and the complainant has failed to satisfactorily establish that he had advanced a loan of Rs.2,00,000/- to the accused and that for the discharge of the said loan amount, the accused had issued the said cheque. The learned Magistrate has also noticed that according to the answer elicited in the cross-examination
7 of the complainant, the loan was advanced in the year 1997 and assuming for the purpose of argument that the loan had been advanced in the year 1997, the cheque said to have been issued on 10.03.2002 cannot be presumed to have been issued for the discharge of a legally enforceable debt since by that date the debt advanced in the year 1997 had been barred by time. In that view of the matter, the learned Magistrate held that the accused is not guilty of the offence punishable under Section 138 of the N.I.Act. 8) No doubt, the accused has not disputed the signature appearing on the cheque in question and that the cheque relates to the account held by him with a Banker. According to the apparent tenor of the cheque, the complainant is the drawee and it has been issued for a sum of Rs.2,00,000/- and it bears the date as 10.03.2002. 9) Clause (b) of Section 118 of the N.I. Act raises a presumption as to the date of the Negotiable Instrument. According to this presumption, every Negotiable Instrument bearing a date is presumed to have been made
8 or drawn on such date. According to Clause (a) of Section 118 of the N.I. Act, every Negotiable Instrument is presumed to have been made or drawn for consideration. Section 139 of the N.I. Act raises a presumption that, unless the contrary is proved, the holder of a cheque received the cheque of the nature referred to under Section 138 of the N.I. Act for the discharge, in whole or in part of any debt or other liability. The cheque of the nature referred to in Section 138 of the N.I. Act should be a cheque issued for the discharge of a legally enforceable debt or other liability, as per explanation to Section 138 N.I. Act. All these presumptions are rebuttable presumptions. Therefore, having regard to the admitted fact that the cheque in question bears the signature of the accused and it relates to the account held by him with the Banker, the presumption under Section 139 of the N.I. Act that it was issued for discharge of debt will have to be raised. 10) In the decision reported in 2010 AIR SCW 2946 [RANGAPPA V/s MOHAN], it has been held the presumption
9 under Section 139 of the N.I. Act extends even to the existence of the debt. 11) The question would be whether the respondent/accused has satisfactorily rebutted the presumption under Section 139 of the N.I. Act? 12) It is fairly well-settled by catena of decisions that the accused in order to substantiate his defence is not necessarily required to enter the witness-box and he is not required to prove the defence beyond reasonable doubt unlike the prosecution, which is required to prove the guilt beyond reasonable doubt. The standard of proving the defence is preponderance of probabilities and not proof beyond reasonable doubt. Therefore, the accused in order to substantiate his defence could either lead positive evidence or point-out the circumstances in the evidence of the complainant himself, which are sufficient to rebut the statutory presumption under Section 139 of the N.I. Act.
10 13) As rightly observed by the learned Magistrate, in this case, the complainant has not disclosed the date on which the alleged loan of substantial sum of Rs.2,00,000/- was paid to the accused. It is an undisputed fact that the respondent is an Advocate by profession and for a period of about 4 to 5 years, the complainant was his client having entrusted several briefs. Thus, the relationship between the respondent and the complainant was that of an advocate and client. The evidence produced by the accused in the form of photographs indicates that the complainant had become more than a client. He appears to have later became a family friend of the accused. Though the complainant contends that the cheque in question was issued by the accused for discharge of the liability due by him in a sum of Rs.2,00,000/-, no document evidencing the lending of Rs.2,00,000/- is forthcoming. The first document, which came into existence in the series of order, in the absence of any document evidencing the lending, was the notice issued under Section 138 of the N.I. Act. The copy of the
11 said notice is marked as Ex.P.8. Perusal of Ex.P.8 does not indicate the date on which the alleged loan was advanced. respondent. Ex.P.12 is the reply notice issued by the In the said reply, the accused denied the case of the complainant and had alleged that complainant himself had taken loan of Rs.2,50,000/- on various occasions and in that regard, the complainant has executed a promissory note for a sum of Rs.2,40,000/-. In spite of such averments made in the reply notice- Ex.P.12, in the complaint presented on 08.11.2002, the complainant has not disclosed the date on which the loan was advanced. On top of it even in his examination-inchief filed by way of affidavit, he has not disclosed the date on which the loan was advanced. It is highly unnatural to believe that a person, who had lent a substantial sum of Rs.2,00,000/-, would not remember the date on which the loan was advanced. In the cross-examination by the learned counsel for the accused, the complainant has stated that the loan was advanced in the year 1997. In the year 1997, a sum of Rs.2,00,000/- was certainly a
12 substantial amount. The appellant/complainant claims to be an Income-tax Assessee. As an Income-tax Assessee, it cannot be said that he had no knowledge that loan of such substantial amount cannot be given in cash. Admittedly, the alleged loan was not advanced by means of any account payee cheque as is required by the provisions of the Income-Tax Act. Though PW.1 has stated in the cross-examination that, in his Income-tax Returns he has shown the loan advanced to the accused and he has no difficulty in producing the same, the same has not been produced for the reason best known to him. The best piece of evidence in possession of the complainant has been with-held, therefore, an adverse inference requires to be drawn against the complainant for non-production of the same. It has to be presumed that the complainant has with-held the production of the said document, as the production of such document would have gone against him. 14) The accused has produced a copy of the promissory note said to have been executed by the
13 complainant as per Ex.D3. In the cross-examination of the accused, it is suggested by the learned counsel for the complainant that the accused is a Legal Adviser to a Finance Corporation namely Pandamitra Finance Corporation and the father of the accused was a partner. He has denied the said suggestion. It was further suggested to the accused that the complainant had availed loan of Rs.28,000/- from the said Financial Institution and at that time, the accused had obtained signature of the complainant on a blank Promissory Note. According to the apparent tenor of the Promissory Note-Ex.D3, it was executed on 27.04.2000. From the suggestion made to DW.1, it is clear that the complainant has admitted his signature on the promissory note. However, the complainant has not produced any acceptable evidence to substantiate his case regarding the circumstances under which he said to have executed the promissory note. It is highly unnatural to believe that the complainant who is an Income-tax Assessee would have availed loan of Rs.28,000/- from a Financial Institution by executing
14 blank Promissory Notes. Therefore, the said suggestion is not substantiated. On the other hand, the complainant has admitted the execution of the Promissory Note-Ex.D3 in favour of the accused. According to Ex.D3, the complainant was due in a sum of Rs.2,40,000/- to the accused. Admittedly, the accused has filed a civil suit against the complainant for recovery of the said amount due under the promissory note. If really, the complainant himself was due in a sum of Rs.2,40,000/- to the accused and he had executed a promissory note on 28.04.2000, it is highly difficult to believe that the accused would have issued a cheque for a sum of Rs.2,00,000/- dated 10.03.2002. Therefore, under these circumstances, in my opinion, the accused has satisfactorily rebutted the presumption under Section 139 of the N.I. Act. The complainant has not produced any evidence to substantiate his case. In addition to this, if the loan was advanced in the year 1997 as stated by the complainant in his cross-examination, on the date of the cheque, namely, 10.03.2002, the loan had become barred by time,
15 therefore, it was not a legally enforceable debt. In that view of the matter, the learned Magistrate is justified in holding that the cheque in question bearing apparent date as 10.03.2002 cannot be held to have been issued for discharge of a legally enforceable debt, since there was no legally enforceable debt as on that date. In this view of the matter, in my opinion, the learned Magistrate is justified in acquitting the respondent/accused. The judgment under appeal does not suffer from any perversity or illegality nor any infirmity is pointed-out. Therefore, the judgment under appeal does not call for interference by this Court. In this view of the matter, the appeal lacks merit and accordingly, the appeal is dismissed. SD/- JUDGE KGR*