Bangalore District Court
Sadashiva Reddy B N vs P Manjunath Reddy on 2 May, 2025
KABC010207762022
IN THE COURT OF THE LXIII ADDL.CITY CIVIL
& SESSIONS JUDGE (CCH-64) AT BENGALURU
Dated this the 2nd day of May, 2025
: PRESENT :
Sri. I. P. Naik
LXIII ADDL.CITY CIVIL & SESSIONS
JUDGE, BENGALURU CITY.
Crl.A.No.887/2022
APPELLANT: Manjunath Reddy,
S/o.Narayan Reddy,
Aged about 43 years,
R/at.No.537, 'B' Main Road,
Next to Rushan Fancy Store,
Near Dodda Banaswadi Bus Stand,
Bengaluru-560 043.
(By A.M. Adv)
-V/s-
RESPONDENT : Sadashiva Reddy.B.N
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S/o.Narayan Reddy,
Aged about 64 years,
R/at.No.1,
Narayan Reddy Layout,
Behind New Baldwin School,
Bengaluru-560 043.
(By Sri.SKS- Adv)
*******
JUDGMENT
The appellant has preferred this appeal against the
Judgment and order passed by the learned 8 th ASCJ
and ACMM, Bengaluru in C.C.No.27538/2012 dated
29.06.2022. Hereinafter, their rank is referred as per
the their rank before the Trial Court.
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Crl.Rev.P.No.507/2022
KABC010272772022
IN THE COURT OF THE LXIII ADDL.CITY CIVIL &
SESSIONS JUDGE (CCH-64) AT BENGALURU
Dated this the 2nd day of May, 2025
: PRESENT :
Sri. I. P. Naik
LXIII ADDL.CITY CIVIL & SESSIONS
JUDGE, BENGALURU CITY.
Crl.Rev.P.No.507/2022
PETITIONER: Sadashiva Reddy.B.N
S/o.Narayan Reddy,
Aged about 64 years,
R/at.No.1,
Narayan Reddy Layout,
Behind New Baldwin School,
Bengaluru-560 043.
(By Sri.SKS- Adv)
-V/s-
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RESPONDENT :
Manjunath Reddy,
S/o.Narayan Reddy,
Aged about 43 years,
R/at.No.537, 'B' Main Road,
Next to Rushan Fancy Store,
Near Dodda Banaswadi Bus Stand,
Bengaluru-560 043.
(By A.M. Adv)
*******
JUDGMENT
The petitioner has filed this petition against the Judg-
ment and order passed by the learned 8th ASCJ and
ACMM, Bengaluru in C.C.No.27538/2012 dated
29.06.2022. Hereinafter, their rank is referred as per
the their rank before the Trial Court.
2. The factual matrix of case:-
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Crl.Rev.P.No.507/2022The complainant and accused are well known to
each other since long time. In the last week of July
2011 accused approached the complainant for financial
assistance for his business to the tune of
Rs.90,00,000/-. Accused received said total amount of
Rs.90,00,000/- on various dates. Accused issued 12
cheques towards outstanding due amount and agreed
to repay the said amount within 6 months. Out of that,
cheque bg.No.320859 issued on 11.05.2012 for repay-
ment of Rs 4,00,000/-, cheque bg.No.175607 issued on
12.05.2012 for repayment of Rs 10,00,000/- & cheque
bg No 175606 issued onfor repayment Rs 5,00,000/-.
The complainant presented the said cheque through his
banker for encashment. The said cheques for encash-
ment through his banker, but these cheques were
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dishonoured as “Account Closed” and “funds insuffi-
cient”. Thereafter complainant got issued legal notice
through counsel on 07.06.2012 through RPAD and
speed post. Inspite of service of notice accused failed to
repay the amount covered under the 3 cheques within
stipulated time. After complying strict conditions of
section 138 of N.I Act, the complainant presented pri-
vate complaint before the Trial Court.
3. On registration of the PCR, the learned learned
Trial Court took cognizance for alleged O/P/U/Sec 138
of N.I. Act. Thereafter, sworn statement of complainant
is recorded. On considering materials available on
record, learned Trial Court opined that, there is prima-
facie case and sufficient materials to proceed against
accused person. Accordingly, criminal case has been
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registered against accused person in Register-III and
issued Summons against him.
4. In pursuant to the Summons, accused
has appeared through his counsel before the Trial
Court and got enlarged on regular bail. Thereafter, plea
has been recorded and read over to them. Accused have
pleaded not guilt and claims to be tried. Hence, case is
posted for evidence.
5. The complainant has got examined two witnesses
as PW.1 and PW.2 (including himself) and in support of
oral evidence produced 32 documents which are
marked at Ex.P.1 to Ex.P.32. Thereafter statement of
the accused is recorded U/s.313 of Cr.P.C. accused
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has denied the incriminating evidence. Accused has not
chosen to lead defence evidence and also got examined
3 witnesses as DW.1 to DW.3 (including himself) and 21
documents is got marked on his behalf as Ex.D.1 to
Ex.D.21.
6. After considering the oral and documentary
evidence and hearing of the parties, the learned Trial
Court has convicted the accused and sentenced him to
pay compensation. The accused dis-agreed and
dis-satisfied with the said Judgment, preferred the
appeal on the following grounds that, the impugned
Judgment and order is illegal, unjust and arbitrary.
There is no documents to show that the complainant
lend an amount of Rs.90,00,000/- to the accused. The
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complainant failed to prove on each date how much
amount was lend to the accused. This fact is not proved
by the complainant. The Trial Court not considered the
oral and documentary evidence and defence of the ac-
cused. During cross-examination PW.1 stated that he
has paid Rs.90,00,000/- to the accused from the com-
pensation amount availed from the acquisition of the
house for Metro. Further he stated that he has pur-
chased agricultural land after getting compensation
from the Metro. By considering the compensation
amount obtained by the complainant, purchase of the
lands of 57 acres of land, he is totally unable to pay the
amount as claimed by him.
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7. The accused specifically stated that he is not fi-
nancially sound enough to pay the said huge amount to
the complainant. Perused the material facts submitted
before the Trial Court. Further, he has taken con-
tention that he has taken advantage of the cheques is-
sued for security purpose to Gokulam Chits on behalf
of the complainant.
8. The accused has strongly, taken contention that the
complainant and his daughter bid the chits in Gokulam
Chits. At that time, they have taken documents and
cheques from the accused for collateral purpose to their
chits. In this regard, the accused lodged complaint be-
fore the learned 4th ACMM, Bengaluru. The learned ju-
risdictional Magistrate referred the case for investiga-
tion. Accordingly, Banasawadi police have registered
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the case and conducted investigation against the
complainant and accused. Further, they have filed
charge sheet against them. The case is pending for
adjudication. This fact is unequivocally admitted by the
complainant in his evidence. Themselves have availed
loan of ₹.50,00,000/-. Accused had stood as surety for
the said amount. This fact is also admitted by the PW.1
in his cross-examination. This facts are not considered
by the Trial Court. The complainant is not at all
discharges his initial burden. The Trial Court has
committed grave error in convicting accused person.
Therefore, accused successfully rebutted the
presumption available in favour of the complainant. By
adducing cogent evidence and conducting
cross-examination of all witness on behalf of the
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complainant. Hence, prays to allow the appeal and set
aside the impugned Judgment and Order acquitted the
accused.
9. The complainant is also disagree and dis-satisfied
with the impugned Judgment and order passed by the
Trial Court with respect imposing quantum of sentence
and questioned the correctness and legality of the same
in this Revision Petition on the ground that the learned
trial Court has not properly appreciated the facts, mate-
rials both oral and documentary evidence. The Trial
Court not considered the ingredients of the offence pun-
ishable U/s. 138 of the N.I Act. The learned Trial Court
utterly failed to consider accused rebutted the manda-
tory presumption arise in favour of the petitioner. The
learned Trial Court punished the accused and sen-
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tenced. The quantum of sentence is lesser one. The
Trial Court not considered the principles laid down by
Hon’ble Apex Court in Moinuddin Abdul Sattar Vs. Vi-
jay D. Selvi’s case {(2015) 9 SCC 622}. Sentence im-
posed on the accused is inadequate and against law
and probabilities. Hence, prays for allow the petition
and convict the accused for alleged offence and impose
fine of ₹.32,00,000/- in addition to imprisonment for a
period of two years and also to pay compensation.
10. After registration of these petitions, issued notice
to rival party. In pursuant of notice, rival party in these
petitions appeared through their counsel.
11. Heard, both side.
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12. The learned counsel or the accused submitted that
in this case, accused successfully proved the defence by
adducing oral and documentary evidence. The Trial
Court has not considered the proved facts and defence
of the accused. It is specific case of the accused that he
had stood as surety for the chit amount received by the
complainant and his daughter. This fact is
unequivocally admitted by the complainant and his
witnesses. Further accused has issued 12 cheques for
collateral/security purpose. This aspect is not at all
considered by the Trial Court. The complainant has
misused the same. In this regard, the accused lodged
private complaint before the jurisdictional magistrate.
Based on the private complaint, the learned 4 th ACMM,
Bengaluru has referred this face for investigation.
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Accordingly, Banaswadi Police registered the case in
Cr.No.499/2012 and conducted the investigation and
found that the complainant and his daughter misused
the cheques. Accordingly, they have filed charge sheet
against them for the offence punishable U/s.420, 406,
120-B R/W. Sec. 34 of IPC. This fact is also admitted by
the complainant in his evidence. This fact is not at all
considered by the Trial Court.
13. The learned Trial Court has committed error on
considering the financial capacity of the complainant.
The complainant himself admitted that after receiving
compensation amount from Bengaluru Metro Rail Cor-
poration Limited (in short BMRCL) he had purchased
57 acres of land in and around Karnataka and Andhra
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State borders. The complainant has uppressed the true
material fact before the Court and he has not discloses
regarding how much amount was spent for purchase of
57 acres of land. This fact is totally silent. This aspect
is unequivocally admitted by the complainant in his
cross-examination. That fact is also not considered by
the Trial Court. Further, the accused successfully
proved that the complainant is not having financial ca-
pacity to lend ₹.90,00,000/- to the accused This bur –
den is not at all discharged by the complainant, By
considering the entire evidence and defence taken by
the accused he has successfully rebutted the presump-
tion available infavour of the complainant.
14. The complainant has also filed Revision Petitioner
before this Court for enhancement of the sentence on
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the ground as it is inadequate. In this case, the ac-
cused has successfully rebutted the presumption. In
such circumstances, the complaint is liable to be dis-
missed as result of appeal, the revision petition filed by
the appellant is liable to be rejected. Therefore, prays to
allow the appeal as prayed for and reject the revision
petition filed by the respondent.
15. As against this, the learned counsel for the com-
plainant urged that, in this case, there is no dispute re-
garding issuance of cheques in question and signature
of the accused found on the said cheques. The accused
is doing construction business and for his necessity
availed loan on different dates. In order to repayment of
the loan availed from the complainant accused issued
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12 cheques for repayment. Now in order to avoid and to
escape from the liability, he launched criminal offence
against complainant and his daughter. The com-
plainant has not produced any material before the
Court. The complainant placed all materials before the
Trial Court. The Trial Court rightly convicted the ac-
cused. There is no 2 nd view in this appeal. In this
case, there is no dispute regarding service of notice.
Further, there is no disputed regarding relationship of
the complainant and accused. Therefore, the Trial
Court has assigned proper reasons and has come to
proper conclusion. Hence, prays to dismiss the appeal.
16. Further, the learned counsel for the complainant
urged that the learned Trial Court has not considered
the facts of the case while imposing sentence and fine.
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The sentence imposed on accused is inadequate. The
Trial Court ought to have followed the guidelines laid
down by the Hon’ble Apex Court in Moinuddin Abdul
Sattar’s case. Hence, prays for allow the Revision Peti-
tion and modify the sentence imposed by Trial Court.
17. On considering the grounds urged in the memo
the following points arise for my consideration:
1. Whether the Trial court committed error in
considering the defence of the accused
while passing Impugned Judgment and
Order.?
2. Whether Trial Court has imposed
inadequate sentence and imposed fine of
lesser side?
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3. What order?
18. On considering the appeal memo presented in the
Appeal memo, Revision Petition, complaint, oral and
documentary evidence of both parties and on hearing of
both the parties my answer to the above points are as
under:
Point No.1: in the Negative,
Point No.2: in the Negative,
Point No.3: As per final order
……………for the following;
REASONS
POINT No.1:
19. In order to prove the allegations made against the
accused, the complainant himself stepped into the
witness box and filed affidavit in lieu of examination in
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chief. In support of his contention he has produced
documents i.e., cheques, bank endorsement, notice
copy, sale deed, mutation extract, bank pass book and
other documents related to acquisition of his property
by the BMRCL. During cross-examination he stated
that Banaswadi Police have registered case against
himself and his daughter in Cr.No.499/2012. Further,
he admitted that the criminal case bg.
C.C.No.15661/2014 is pending for disposal against
them before the 4th ACMM, Bengaluru. Further he
stated that himself and his daughter have bid chit chit
amount from the Gokulam Chits. Further, admitted
that accused stood collateral surety for the bid amount
by him. Further he admitted that the accused deposited
his title deed on behalf of him in Gokulam Chits. The
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learned counsel for the accused stated he repaid the
amount to Gokulam Chits. He stated that no document
regarding payment loan by accused.
20. In the cross-examination PW.1 further stated that
he has paid ₹.90,00,000/- to accused in July 2011. he
has got compensation of ₹.1,70,00,000/- due to his
house was acquired by the BMRCL. Further he
admitted that he had purchased agricultural lands after
getting compensation from the BMRCL. In this regard,
he has produced the sale deed. The entire
compensation amount deposited at Vijaya Bank
account Dodda Banaswadi Branch.
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21. The complainant stated that he has produced the
documents pertaining to the 26 acres. He do not
remember about remaining 31 acre of land purchased
by him. PW.1 further stated in his cross-examination
that he had bank account with Andhra Bank, Indian
Overseas Bank, Vijaya Bank and State Bank of India
Bank, Chikkaballapura Branch. He has produced the
statement related to these accounts. Accused not
executed any Pronote, cheques, I.D card, Address Proof,
except property documents. PW.1 do not remember
how many balance amount in his account other than
account maintained in the Vijaya Bank.
22. On 03.12.2018, PW.1 further tendered for cross-
examination after production of Ex.P.20 to Ex.P.32.
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During cross-examination he was unable to say who
much amount has been paid towards purchase of the
lands.
23. The wife of the complainant is examined as PW.2.
She stated regarding they have obtained compensation
of ₹.1,70,00,000/- from BMRCL in the month of July
2011. Accused availed hand loan of ₹.90,00,000/- for
financial assistance and for financial assistance
purpose. Further, she stated that her husband
purchase 54 acres of land in Karnataka and Andhra
pradesh.
24. During her cross-examination PW.2 stated that
here husband bid the chit in Gokularm Chits, at that
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time, accused has given surety. Further, he stated that
accused stood is surety for ₹.20,00,000/-by mortgaging
the documents. Further stated that, they have not
produced any document to show that having
₹.90,00,000/- in their hands.
25. Further, the accused himself examined as DW.1
before this court. He has filed affidavit in lieu of
examination in chief wherein he categorically stated
that he has not received any amount from the
complainant for his business purpose and also not
issued any cheque in question for repayment of the
debt as alleged by the complainant. Further, he
categorically stated that he has stood as surety for the
chit bid by the complainant and his daughter for
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₹.50,00,000/-. Int his regard, he has deposited his title
deed and also executed mortgage deed and also he has
issued blank signed cheques for security purpose. The
complainant himself used the said cheque and filed
false complaint against him. He has not financially
sound to lend such a huge amount to him.
26. The DW.1 further stated in his chief examination
that his property was acquired by the BMRCL and he
was granted compensation of ₹.1,70,00,000/-. Out of
that, he has purchased the lands admeasured 57 acres.
Further he has no documents to show bid amount has
been repaid to him.
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27. During couse of cross-examination he stated that
cheques in question belongs to his bank account. He
himself has written the amount in words and also
figures and put his signature. He is aware that his
account maintained in the Vijaya Bank is closed and
also he had issued Stop Payment instructions to the
Vijaya Bank.
28. Further he stated that he has not lodged any
complaint before the police after receipt of the notice.
Further he stated that no criminal case (counter case)
is filed after filing of the criminal proceedings against
him. He admitted that as on the date of he stood as
surety he was not a member of the Gokulam Chits.
Further he stated that he having 12 apartments and
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his is doing construction business. The learned counsel
for the accused specifically suggested that
₹.90,00,000/- received from the complainant is used
for completion of the Commercial Building. This
suggestion is categorically denied. Further stated that
one Srinivas was running private chit funds. Further,
the learned counsel for the accused specifically stated
that C.Srinivas is his close friend, therefore, you are
mentioning his name. This suggestions is denied.
29. One Bank Manger by name Manjunatha Reddy is
examined on his behalf of the accused as DW.2. He
stated that he has produced the account opening form
marked at Ex.D.14, account statements as per Ex.D.15
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and Ex.D.16. Cheque book received by the accused in
the year 2010.
30. In the cross-examination DW..2 stated that
cheques are valid for a period of 3 months from the date
of issue. They have issued endorsement for dishonour
of the cheque due to Stop payment instructions.
31. Another witness one Vinodan who is Assistant
Manager of the Gokulam Chits is examined as DW.3.
He deposed that he knows the complainant and how
both are members of their chits. The complainant and
his wife and daughter have obtained chits from their
chits funds. Accused has given collateral surety for chit
amount received by the accused. Further stated that
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chit amount of ₹. 7,91,000/- is adjusted to the chit
amount of the complainant. Further stated that they
have received information on the basis of the complaint
lodged against the accused by the complainant.
Further stated that, they have taken mortgage deed for
collateral purpose.
32. During cross-examination he stated that as per
the instructions of the accused, they have adjusted the
amount ₹.7,92,700/- to the account of the
complainant. They have not collected the cheques for
security purpose.
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33. On considering entire deposition of PW.1, PW.2
and DW.1, The followings facts is undisputed and
admitted by both complainant and accused.
33.1 The complainant and accused are hails from same
village and both are good friends since 20 years.
33.2 The accused doing construction business. He
having 12 apartments in property out that he having
commercial building.
33.3 The complainant and his daughter are membe₹ of
Gokulam Chits Jayanagar Branch, Bengaluru. The
complainant was bidding chit for ₹ 25/- lakhs and his
daughter was bidding chit for ₹ 15/- lakhs. In order to
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return the chit amount, accused obtained the amount
of ₹ 13 lakhs and repaid to Gokulam chits.
33.4 Accused stood surety for chit amount bid total
amount of ₹ 40/- lakhs by depositing his property titles
documents for collateral purpose, this facts revels from
deposition of DW.3 and documents produced by DW.3.
33.5 A house property of complainant has been
acquired by BMRCL for construction of Metro Rail in
Bengaluru and he got compensation amount of ₹
1,70,00,000/- through cheque.
33.6 After getting compensation amount, the
complainant has purchased the agriculture land of 57
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acres vicinity of Karnataka and Andra state borders by
using compensation amount.
33.7 The Banasawadi police have registered the case
against complainant and his daughter in crime No
499/2012, after investigation said police submitted
charge sheet against them before learned 4th ACMM
Bengaluru. Further both are facing criminal charges.
33.8 The disputed 12 cheques are belongs to account of
accused, they have bears signature of accused. The
accused himself handed over 12 cheques to
complainant.
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33.9 Prior to filing private complaint, the complainant
has complied all statutory restriction/condition
contemplated U/Sec 138 of N.I.Act. i.e.,
i. Presentation of cheques for
encashment within stipulated time.
ii. reasons for dishonour of said
cheques.
iii. issuance of statutory notice to
accused.
iv. a service of notice statutory notice
on accused and reply of accused to
statutory notice and
v. filing of private complaint before
learned Trial Court within stipulated
time.
34. Based on aforesaid admitted/undisputed facts,
before examination of oral and documentary evidence
and analysis the same, this Court has relied on
Judgment of Hon’ble Supreme Court regarding burden
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of proof and rebut of presumption available in favour of
complainant U/Sec 118 and Sec 139 of N.I.Act as
under;
AIR 2023 SC 5018
Rajesh Jain Vs Ajay Singh
BURDEN OF PROOF AND PRESUMPTIONS: CONCEPTUAL
UNDERPINNINGS
29. There are two senses in which the phrase ‘burden of
proof ‘ is used in the Indian Evidence Act, 1872
(Evidence Act, hereinafter). One is the burden of proof
arising as a matter of pleading and the other is the one
which deals with the question as to who has first to
prove a particular fact. The former is called the ‘legal
burden’ and it never shifts, the latter is called the
‘evidential burden’ and it shifts from one side to the
other. [See Kundanlal v. Custodian Evacuee Property
(AIR 1961 SC 1316)]
30. The legal burden is the burden of proof which
remains constant throughout a trial. It is the burden of
establishing the facts and contentions which will support
a party’s case. If, at the conclusion of the trial a party
has failed to establish these to the appropriate
standards, he would lose to stand. The incidence of the
burden is usually clear from the pleadings and usually, it
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is incumbent on the plaintiff or complainant to prove
what he pleaded or contends. On the other hand, the
evidential burden may shift from one party to another as
the trial progresses according to the balance of evidence
given at any particular stage; the burden rests upon the
party who would fail if no evidence at all, or no further
evidence, as the case may be is adduced by either side
(See Halsbury’s Laws of England, 4th Edition para 13).
While the former, the legal burden arising on the
pleadings is mentioned in Section 101 of the Evidence
Act, the latter, the evidential burden, is referred to in
Section 102 thereof. [G.Vasu V. Syed Yaseen (AIR 1987
AP139) affirmed in Bharat Barrel Vs. Amin Chand [(1999)
3 SCC 35] ]
31. Presumption, on the other hand, literally means
“taking as true without examination or proof”. In Kumar
Exports v. Sharma Exports [(2009) 2 SCC 51320] this
Court referred to presumption as “devices by use of
which courts are enabled and entitled to pronounce on
an issue notwithstanding that there is no evidence or
insufficient evidence.”
32. Broadly speaking, presumptions are of two kinds,
presumptions of fact and of law. Presumptions of fact are
inferences logically drawn from one fact as to the
existence of other facts. Presumptions of fact are
rebuttable by evidence to the contrary. Presumptions of
law may be either irrebuttable (conclusive presumptions),
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so that no evidence to the contrary may be given or
rebuttable. A rebuttable presumption of law is a legal
rule to be applied by the Court in the absence of
conflicting evidence (Halsbury, 4th Edition paras 111,
112]. Among the class of rebuttable presumptions, a
further distinction can be made between discretionary
presumptions (‘may presume’) and compulsive or
compulsory presumptions (‘shall presume’). [G. Vasu V.
Syed Yaseen (Supra)]
33. The Evidence Act provides for presumptions, which
fit within one of three forms: ‘may presume’ (rebuttable
presumptions of fact), ‘shall presume’ (rebuttable
presumption of law) and conclusive presumptions
(irrebuttable presumption of law). The distinction
between ‘may presume’ and ‘shall presume’ clauses is
that, as regards the former, the Court has an option to
raise the presumption or not, but in the latter case, the
Court must necessarily raise the presumption. If in a
case the Court has an option to raise the presumption
and raises the presumption, the distinction between the
two categories of presumptions ceases and the fact is
presumed, unless and until it is disproved, [G.Vasu V.
Syed Yaseen (Supra)] Section 139 NI Act-Effect of
Presumption and Shifting of Onus of Proof
34. The NI Act provides for two presumptions: Section
118 and Section 139. Section 118 of the Act inter alia
directs that it shall be presumed, until the contrary is
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proved, that every negotiable instrument was made or
drawn for consideration. Section 139 of the Act
stipulates that ‘unless the contrary is proved, it shall be
presumed, that the holder of the cheque received the
cheque, for the discharge of, whole or part of any debt or
liability’. It will be seen that the ‘presumed fact’ directly
relates to one of the crucial ingredients necessary to
sustain a conviction under Section 138.
35. Section 139 of the NI Act, which takes the form of a
‘shall presume’ clause is illustrative of a presumption of
law. Because Section 139 requires that the Court ‘shall
presume’ the fact stated therein, it is obligatory on the
Court to raise this presumption in every case where the
factual basis for the raising of the presumption had been
established. But this does not preclude the person
against whom the presumption is drawn from rebutting
it and proving the contrary as is clear from the use of the
phrase ‘unless the contrary is proved’.
36. The Court will necessarily presume that the cheque
had been issued towards discharge of a legally
enforceable debt/liability in two circumstances. Firstly,
when the drawer of the cheque admits
issuance/execution of the cheque and secondly, in the
event where the complainant proves that cheque was
issued/executed in his favour by the drawer. The
circumstances set out above form the fact(s) which bring
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about the activation of the presumptive clause. [Bharat
Barrel Vs. Amin Chand] [(1999) 3 SCC 35]
37. Recently, this Court has gone to the extent of holding
that presumption takes effect even in a situation where
the accused contends that ‘a blank cheque leaf was
voluntarily signed and handed over by him to the
complainant. [Bir Singh v. Mukesh Kumar {(2019) 4 SCC
19723}]. Therefore, mere admission of the drawer’s
signature, without admitting the execution of the entire
contents in the cheque, is now sufficient to trigger the
presumption.
38. As soon as the complainant discharges the burden to
prove that the instrument, say a cheque, was issued by
the accused for discharge of debt, the presumptive device
under Section 139 of the Act helps shifting the burden
on the accused. The effect of the presumption, in that
sense, is to transfer the evidential burden on the accused
of proving that the cheque was not received by the Bank
towards the discharge of any liability. Until this
evidential burden is discharged by the accused, the
presumed fact will have to be taken to be true, without
expecting the complainant to do anything further.
39. John Henry Wigmore (Rules of Evidence- The
Hidden Origin of Modern Law )on Evidence states as
follows:
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Crl.Rev.P.No.507/2022“The peculiar effect of the presumption of law is merely to invoke a
rule of law compelling the Jury to reach the conclusion in the
absence of evidence to the contrary from the opponent but if the
opponent does offer evidence to the contrary (sufficient to
satisfy the Judge’s requirement of some evidence), the
presumption ‘disappears as a rule of law and the case is in theJury’s hands free from any rule.” (underline by me, for emphases)
40. The standard of proof to discharge this evidential
burden is not as heavy as that usually seen in situations
where the prosecution is required to prove the guilt of an
accused. The accused is not expected to prove the non-
existence of the presumed fact beyond reasonable doubt.
The accused must meet the standard of ‘preponderance
of probabilities’, similar to a defendant in a civil
proceeding. [Rangappa vs. Mohan (AIR 2010 SC 1898)]
41. In order to rebut the presumption and prove to the
contrary, it is open to the accused to raise a probable
defence wherein the existence of a legally enforceable
debt or liability can be contested. The words ‘until the
contrary is proved’ occurring in Section 139 do not mean
that accused must necessarily prove the negative that
the instrument is not issued in discharge of any
debt/liability but the accused has the option to ask the
Court to consider the non-existence of debt/liability so
probable that a prudent man ought, under the
circumstances of the case, to act upon the supposition
that debt/liability did not exist.[Basalingappa Vs.
Crl.A.No.887/2022 C/W
41
Crl.Rev.P.No.507/2022
Mudibasappa (AIR 2019 SC 1983) See also Kumar
Exports Vs. Sharma Carpets (2009) 2 SCC 513]25
42. In other words, the accused is left with two options.
The fi₹t option-of proving that the debt/liability does not
exist-is to lead defence evidence and conclusively
establish with certainty that the cheque was not issued
in discharge of a debt/liability. The second option is to
prove the non-existence of debt/liability by a
preponderance of probabilities by referring to the
particular circumstances of the case. The preponderance
of probability in favour of the accused’s case may be even
fifty one to forty nine and arising out of the entire
circumstances of the case, which includes: the
complainant’s version in the original complaint, the case
in the legal/demand notice, complainant’s case at the
trial, as also the plea of the accused in the reply notice,
his 313 statement or at the trial as to the circumstances
under which the promissory note/cheque was executed.
All of them can raise a preponderance of probabilities
justifying a finding that there was ‘no debt/liability’.
[Kumar Exports and Sharma Carpets, (2009) 2 SCC 513]
43. The nature of evidence required to shift the
evidential burden need not necessarily be direct
evidence i.e., oral or documentary evidence or
admissions made by the opposite party; it may
comprise circumstantial evidence or presumption of
law or fact. (underline by me, for emphases)
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44. The accused may adduce direct evidence to prove
that the instrument was not issued in discharge of a
debt/liability and, if he adduces acceptable evidence, the
burden again shifts to the complainant. At the same
time, the accused may also rely upon circumstantial
evidence and, if the circumstances so relied upon are
compelling the burden may likewise shift to the
complainant. It is open for him to also rely upon
presumptions of fact, for instance those mentioned in
Section 114 and other sections of the Evidence Act. The
burden of proof may shift by presumptions of law or fact.
In Kundanlal’s case- (supra) when the creditor had failed
to produce his account books, this Court raised a
presumption of fact under Section 114, that the
evidence, if produced would have shown the non-
existence of consideration. Though, in that case, this
Court was dealing with the presumptive clause in
Section 118 NI Act, since the nature of the presumptive
clauses in Section 118 and 139 is the same, the analogy
can be extended and applied in the context of Section
139 as well.
45. Therefore, in fine, it can be said that once the
accused adduces evidence to the satisfaction of the
Court that on a preponderance of probabilities there
exists no debt/liability in the manner pleaded in the
complaint or the demand notice or the affidavit-
evidence, the burden shifts to the complainant and
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the presumption ‘disappears’ and does not haunt the
accused any longer. The onus having now shifted to
the complainant, he will be obliged to prove the
existence of a debt/liability as a matter of fact and
his failure to prove would result in dismissal of his
complaint case. Thereafter, the presumption under
Section 139 does not again come to the complainant’s
rescue. Once both parties have adduced evidence, the
Court has to consider the same and the burden of proof
loses all its importance. [Basalingappa vs. Mudibasappa,
AIR 2019 SC 1983; See also, Rangappa vs. Sri Mohan
(2010) 11 SCC 441] (underline by me, for emphases)
35. By following and keeping in mind the above
principles laid down by their lordship, I have examined
the oral testimony of witness examined on behalf of the
complainant as well as accused and also perused the
documents. Already this Court noticed that there is no
disputed regarding the complainant and his daughter
bid the total amount of ₹.50,00,000/- from Gokulam
Chits. The accused stood as surety for the chit amount
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received by the complainant and his daughter by
executing/depositing of title deed. These facts are
admitted one.
36. In this case, the accused himself unequivocally
admitted that himself has handed over the 12 cheques
to the complainant and further he has also stated that
himself has written the amount in words and figures
and also put his signatures. Therefore, heavy burden
lies on accused to disprove the complainant’s
contention and rebut the presumption based on
doctrine of reverse burden as law settled by Hon’ble
Supreme Court in Rangappa Vs Mohan‘s case (AIR
2010 SC 1898).
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37. Immediately, after dishonour of the cheque
complainant got issued notice, the said notice is duly
served on the accused and replied him by put forth his
defence that he has not received amount from the
complainant as alleged for construction of the
Commercial building. His specific stand is that the said
cheques are issued for collateral purpose for the chit
amount received by the complainant. In this case, the
evidence of DW.3 is very important one. In his cross-
examination he has stated that they have not issued
cheque for security purpose. Hence, heavy burden lies
on the accused to prove that, he has not issued cheque
for repayment of the loan as alleged by the
complainant. In this case, accused has taken specific
contention that the complainant has not independent
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income to lend such huge amount. The complainant
himself stated that his house was acquired by the
BMRCL for construction of the Metro. Further he has
taken contention that he has got compensation amount
of ₹.1,70,00,000/-. Further the matter is that by using
the compensation amount he has purchased 57 acres
of land out of that one land situated at CMH Road,
Bengaluru. In this regard, he has produced the
released deed, sale deed pertaining to 21 acres of land.
He has no hurdles produced document pertaining to
31 acres of land. These documents is not produced by
him. In this regard, the learned counsel for the accused
extracted from the mouth of PW.1 same is reiterated for
better appreciation of evidence.
“ನಾನು ಸತ್ಯ ವನ್ನು ಮರೆಮಾಚುವ ಉದ್ದೇಶದಿಂದ ನಾನು
ನ್ಯಾಯಲಯಕ್ಕೆ ಕೇವಲ 2 ಎಕರೆ, 2 ಎಕರೆ 32 ಗುಂಟೆ
Crl.A.No.887/2022 C/W
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Crl.Rev.P.No.507/2022ಮತ್ತು 69, 69, ಸೆಂಟ್ಸ್ ಸಂಬಂಧ ಪಟ್ಟ ದಾಖಲೆಗಳನ್ನು
ಮಾತ್ರ ಹಾಜರು ಪಡಿಸಿದ್ದೆನೆ ಎಂದರೆ ಸರಿ. ನಾನು ಒಟ್ಟು
ಎಷ್ಟು ಎಕರೆ ಜಮೀನನ್ನು ಖರೀದಿ ಮಾಡಿದ್ದೇನೆ ಎಂದು
ಸರಿಯಾಗಿ ನೆನಪಿಲ್ಲ .”
38. In view of this admission on the part of the
complainant, it clearly discloses that he has with hold
the true material facts before the Court and hidden the
same, the best reasons know to him. Therefore, this
Court has relied on Judgment of Supreme Court is as
under;
(1994) 1 SCC 1
S.P. Chengalvaraya Naidu v. Jagannath & O₹.
“5. The High Court, in our view, fell into
patent error. The short question before the
High Court was whether in the facts and
circumstances of this case, Jagannath
obtained the preliminary decree by playing
fraud on the court. The High Court, however,
went haywire and made observations which
are wholly perverse. We do not agree with the
High Court that “there is no legal duty cast
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Crl.Rev.P.No.507/2022upon the plaintiff to come to court with a true
case and prove it by true evidence”. The
principle of “finality of litigation” cannot be
pressed to the extent of such an absurdity
that it becomes an engine of fraud in the
hands of dishonest litigants. The courts of
law are meant for imparting justice
between the parties. One who comes to the
court, must come with clean hands. We are
constrained to say that more often than
not, process of the court is being abused.
Property-grabbers, taxevaders, bank-loan-
dodgers and other unscrupulous persons
from all walks of life find the court-process
a convenient lever to retain the illegal
gains indefinitely. We have no hesitation
to say that a person, who’s case is based
on falsehood, has no right to approach the
court. He can be summarily thrown out at
any stage of the litigation.”
(underline by, for emphasis)
39. In this case, the accused successfully proved the
financial condition of the complainant. There is no
dispute regarding himself and his daughter bid the
amount of ₹.35,00,000/- and ₹.15,00,000/- from
Gokulam Chits they have received total amount of
₹.50,00,000/-. There is no documents to show that
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Crl.Rev.P.No.507/2022
they have repaid the said amount after or before
lending of the amount to the accused and after
receiving compensation amount from BMRCL.
40. There is no disputed regarding when he has
purchased 57 acres of land. The learned counsel for the
accused urged that, out of the compensation amount,
of ₹.90,00,000/- received from the BMRCL he has
purchased 57 acres of land for market value of
₹.1,14,00,000/-.
41. It is specific case of the complainant that he has
paid ₹.90,00,000/- to the accused in the last week of
July 2011. In complaint he has stated that on different
dates the accused has received amount from the
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complainant totally an amount of ₹.90,00,000/- is paid.
In his oral evidence, he has stated that he has paid
₹.90,00,00/- installments to the accused. In this case,
accused has to prove that the complainant is able to
lend ₹.90,00,000/- to him. Further complainant has
not produced any document to show that, whether he
has repaid chits amount, after getting compensation
amount. By considering all these aspects, the Court can
presume cheque issued cheques to discharge of debt
and no presumption regarding existence of legal
enforceable debt or other liability. In this case, accused
has successfully proved that, financial status of
complainant. The complainant has received
compensation amount of ₹ 1,70,00,000/-. By using this
amount he has purchased 57 acres land. The
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complainant has not disclosed how much amount
retained with him after payment of sale consideration.
Further, the complainant has not disclosed that
whether he has repaid the chits amount. This burden of
onus is not discharged by the complainant. Therefore,
it is held that, he has not proved by cogent and revelant
evidence regarding existence of debt. By looking into
the evidence of complainant, it proves that there is no
chance that he can lend huge amount like
₹.90,00,000/- to the accused. The best reasons know
to complainant why he withhold the important
documents in support of this his claim. Hon’ble
Supreme Court recently held in Rekha Sharad Ushir
Vs. Saptashrungi Mahila Nagari Sahkari Patsansta
Ltd [Crl Appeal No. 724/2025, Dtd 26.3.2025] that if
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complainant has suppressed the true materials facts in
complaint, such complaints requires to quashed. There
is no legally enforceable debt towards the complainant.
Accordingly, Point No.1 is answered in the Negative.
42. Point No.2 :-
For the forgoing it is held that the complainant has not
discharged his burden and not proved the existence of
loan. The complainant has not got financial capacity to
lend huge amount of ₹.90,00,000/- to the accused. Ac –
cordingly, it is held that the accused is entitled for ac-
quittal for the offence punishable U/s.138 of N.I Act. In
the result, appeal preferred by the accused is allowed
and the revision petition filed by the complainant is not
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Crl.Rev.P.No.507/2022maintainable. Therefore, Point No.2 is answered in
the Negative.
43. Point No.3 :-For the forgoing reasons, I proceed
to pass the following:
ORDER
The Appeal filed by the Appellant/
accused U/s.374(3)(a) of Cr.P.C. is hereby
allowed.
Further, the Judgment and order passed
by the learned 8th ASCJ and CMM,
Bengaluru in C.C.No.27536/2012 dated
29.06.2022 is hereby set-aside.
Accused is hereby acquitted for the alleged
offence punishable U/s.138 of N.I Act.
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Crl.Rev.P.No.507/2022
Bail bond executed by the accused and his
surety stands cancelled. Surety is
discharged.
The Trial Court is hereby directed to released
the fine amount in favour of the accused if
deposited.
The complainant shall repaid the
compensation amount to accused, if received
from him with interest as per the rate fixed
by the RBI in the month of May 2025 within
30 days from the date of this order.
The Revision Petition filed by the complainant is hereby dismissed. Office is directed to keep the original
judgment in this appeal and its kept in Crl
Rev P.No.505/2022.
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Crl.Rev.P.No.507/2022
Office is directed to sent the TCR along with
the copy of this order forthwith.
(Dictated to Stenographer, typed by her, taken out print corrected by me
and then pronounced in the Open-Court on this the 2nd day of May,
2025)
Digitally signed
irappanna by irappanna
(Sri. I. P. Naik)
LXIII Addl. City CivilPavadi Naik
and Sessions
PavadiJudge (CCH-64), Bengaluru
Date: City.
Naik 2025.05.02
17:24:22 +0530
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Crl.Rev.P.No.507/2022
(Order typed vide separate sheet)
ORDER
The Appeal filed by the
Appellant/accused U/s.374(3)
(a) of Cr.P.C. is hereby
allowed.
Further, the Judgment
and order passed by the
learned 8th ASCJ and CMM,
Bengaluru in
C.C.No.27536/2012 dated
29.06.2022 is hereby set-
aside.
Accused is hereby
acquitted for the alleged
offence punishable U/s.138 of
N.I Act.
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Crl.Rev.P.No.507/2022
Bail bond executed by
the accused and his surety
stands cancelled. Surety is
discharged.
The Trial Court is hereby
directed to released the fine
amount in favour of the
accused if deposited.
The complainant shall
repaid the compensation
amount to accused, if received
from him with interest as per
the rate fixed by the RBI in
the month of May 2025 within
30 days from the date of this
order.
The Revision Petition
filed by the complainant is
hereby dismissed.
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Crl.Rev.P.No.507/2022
Office is directed to keep
the original judgment in this
appeal and its kept in Crl Rev
P.No.505/2022.
Office is directed to sent
the TCR along with the copy
of this order forthwith.
LXIII ACC & SJ(CCH-64),
Bengaluru City
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