Karnataka High Court
M/S Srimatha Mahila Sahakari Bank … vs Mrs. B R Vasanth Kokila on 25 April, 2026
Author: M.G.S. Kamal
Bench: M.G.S. Kamal
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 25TH DAY OF APRIL, 2026
BEFORE
THE HON'BLE MR. JUSTICE M.G.S. KAMAL
CRIMINAL APPEAL NO. 1573 OF 2021 (A)
BETWEEN:
M/S SRIMATHA MAHILA SAHAKARI
BANK NIYAMITHA
NO 403/803, VIII MAIN ROAD
X CROSS, SHASTRYNAGAR
BSK II STAGE
BENGALURU - 560 070
REP BY ITS MANGER
SHARADA M K
...APPELLANT
(BY SRI. ANOOP HARANAHALLI.,ADVOCATE)
AND:
Digitally signed MRS. B R VASANTH KOKILA
by SUMA B N R/AT NO 322
Location: HIGH 3RD STAGE, 4TH BLOCK
COURT OF 8TH MAIN ROAD
KARNATAKA BASAWESWARANAGAR
BANGALORE - 560 079.
...RESPONDENT
(BY SRI. VISHWANATH R HEGDE.,ADVOCATE)
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THIS CRL.A. IS FILED U/S.378(4) CR.P.C PRAYING TO
SET ASIDE THE JUDGMENT OF ACQUITTAL DATED 26.03.2021
IN C.C.NO.22088/2016 ON THE FILE OF THE XXVI ACMM,
BANGALORE AND CONSEQUENTLY ALLOW THIS APPEAL BY
CONVICTING THE ACCUSED/RESPONDENT FOR THE OFFENCE
P/U/S 138 OF N.I ACT.
THIS APPEAL, COMING ON FOR FURTHER HEARING, THIS
DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE M.G.S. KAMAL
ORAL JUDGMENT
This appeal is by the complainant under Section 378 of
Criminal Procedure Code, 1973, being aggrieved by the
judgment and order dated 26.03.2021, passed in
C.C.No.22088/2016 on the file of XXVI Additional Chief
Metropolitan Magistrate, Bangalore City, (hereinafter referred
to as ‘the Trial Court’) by which the accused-respondent has
been acquitted of the offences punishable under Section 138 of
Negotiable Instruments Act, 1881 (hereinafter referred to as
‘the N.I. Act‘).
2. The facts of the case are ;
2.1 That complainant-appellant namely, M/s. Srimatha
Mahila Sahakari Bank Niyamitha, is a Co-Operative Bank
registered under the Karnataka Co-operative Societies Act.
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Accused-respondent is its member. That the accused-
respondent had availed loan in a sum of Rs.30,00,000/- from
the appellant-Society for the purpose of purchase of a
residential flat vide loan account No.OEL-687. That the
accused-respondent had also stood as a guarantor to the loan
availed by one Smt. Shobha of Rs.15,00,000/- towards
purchase of a vehicle vide loan account No.VL-55.
2.2 In addition, accused-respondent had applied for a
loan of Rs.30,00,000/- to purchase three vehicle vide loan
No.VL-86. The relative of the accused-respondent Smt.
Sujatha had also availed loan of Rs.10,00,000/- for purchase of
vehicle vide loan account No.VL-71.
2.3 That the respondent-accused and her relatives
referred to above defaulted in repayment of the said loan
amounts. Appellant-Society therefore initiated the proceedings
before the Joint Registrar of Co-operative Societies, Bangalore
for recovery of loan dues vide dispute No.ARD/UBF/650/2015-
16 and No.ARD/UBF/684/2015-16.
2.4 That the accused-respondent herein was arrayed as
respondent No.1 in dispute No.ARD/UBF/650/2015 and as
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respondent No.3 in No.ARD/UBF/684/2015-16. Accused-
respondent who appeared in the said proceedings admitted the
claim of the appellant-Society and had undertaken to repay the
loan, in furtherance thereof, she had issued a Cheque bearing
No.003171 dated 30.07.2016 drawn on M/s. Tumkur Grain
Merchants Co-operative Bank Ltd., Basaveshwaranagar Branch,
Bengaluru for sum of Rs.66,85,690/-, towards discharge of
liability, which was the total outstanding payable by the
respondent-accused as well as Smt. Sujatha and Smt. Shobha
as of the said date.
2.5 That on presentation of the said cheque for
encashment, the same returned with an endorsement dated
04.08.2016 as ”funds insufficient”.
2.6 That the appellant-Society issued statutory notice on
06.08.2016 through Registered Post Acknowledgment Due
which was duly served on the Accused-respondent. Despite
receipt of the said notice, she has neither replied nor paid the
cheque amount.
2.7 Consequently, complaint under Section 200 Cr.P.C.
came to be filed. Cognizance was taken. Sworn statement was
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recorded. Summons were issued. Accused-respondent who
appeared was enlarged on bail. Since she pleaded not guilty,
matter was set down for trial.
3. One Smt. Premakala, the Branch Manager of the
appellant-Society was examined on behalf of the complainant-
Society as PW.1 and exhibited 53 documents marked as Ex.P1
to Ex.P53. The statement of accused-respondent was recorded
under Section 313 Cr.P.C, wherein she has denied the
incriminating evidence brought against her. Accused-
respondent did not lead any evidence.
4. The Trial Court framed the following points for its
consideration:
” 1) Whether the Complainant society proves that, the accused
to discharge of legally recoverable debt or other liability issued
the alleged cheque bearing No.003171 dated 30.07.2016 drawn
on M/s. Tumkur Grain Merchants Co-operative Bank Ltd.
Basaveshwaranagar Branch, Bangalore for Rs.66,85,690/-?’
2) Whether the Complainant society proves that, on
presentation of said cheque, same was returned unpaid as
“Funds insufficient” and despite of giving legal notice, he failed
to pay the cheque amount, thereby he committed an offence
punishable under Section 138 of NI Act?
3) What order? ”
5. On appreciation of evidence, trial Court answered point
Nos.1 and 2 in the negative, consequently passed the
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impugned judgment and order acquitting the accused-
respondent. Being aggrieved, the present appeal.
6. Learned counsel for the appellant-Society reiterating
the grounds urged in the memorandum of appeal submits;
(a) that the impugned judgment and order passed by the
trial Court acquitting the accused-respondent is contrary to the
settled principles of law, when the issuance of cheque is not
disputed by the accused-respondent. The statutory
presumption contemplated under Section 118 of the N.I. Act,
ought to have been drawn by the trial Court instead of casting
the burden on the appellant-Society to prove its case.
(b) That the trial Court has misread the documents to
arrive at a wrong conclusion of PW1 not having authority to
represent the appellant-Society, despite production of
documents namely, Exs.P1, P52 and P53 evidencing PW1
having been duly authorized to represent and prosecute the
case.
(c) The trial Court has unnecessarily gone into the loan
documents which were produced by the appellant-Society in
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justification of their claim and has come to erroneous
conclusion of said loan documents not justifying the claim made
by the appellant-Society.
(d) That the trial Court has also erroneously found that
there was no prior notice issued by the appellant-Society to the
accused persons before presenting the cheque for encashment
which is neither the requirement of law nor of the facts of the
present case.
(e) When the cheque in question has been admittedly
issued by the accused-respondent, the trial Court ought not to
have held that appellant-Society has not produced relevant
documents to show issuance of the cheque towards discharge
of liability before JRCS proceedings.
(f) The trial court ought not to have held that no cheque
was issued at all contrary to the very defence setup by the
accused-respondent.
(f) That the trial court has further erred in holding that
the accused-respondent could not have been burdened to pay
the entire amount in one go and the cheque ought to have
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been issued in installments, which is unfounded and contrary to
the material evidence.
7. In support of the submissions, he relies upon the
judgment of the Hon’ble Apex Court in the case United Bank
of India Vs. Naresh Kumar and others reported in
(1996) 6 SCC 660, on the point of authorization to represent
a company and the defect which is curable in nature.
8. He further relies upon judgment of the High Court of
Gauhati in the case of M/s. Amprolisa Construction and
Marketing Pvt. Ltd., Vs. Gupta Hardware Pvt. Ltd., and
another in Crl.Pet.No.1263/2022 decided on 03.12.2025 to
contend that absence of board resolution or authorization for
filing a complaint under Section 138 of the N.I. Act is a curable
defect and not a ground to quash the proceedings.
9. He also relies upon the judgment of the ICDS Ltd. Vs.
Beena Shabeer and another reported in (2002) 6 SCC 426,
on the point of maintainability of complaint against the
guarantor under Section 138 of the N.I. Act.
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Thus, he submits that the trial Court has erred in
acquitting the accused-respondent. Hence, seeks for allowing
of the appeal.
10. Learned counsel appearing for the accused-
respondent submits;
(a) that the defect in the nature of lack of authorization
to file and prosecute a complaint under Section 138 of the N.I.
Act is not curable as it has a severe penal consequences and
the same cannot be construed lightly.
(b) That PW1-Bank Manager in the cross examination
recorded on 08.03.2017 in C.C.No.22063/2016, has admitted
regarding she not having been duly authorized at the time of
filing of the complaint. Further, in the cross-examination
recorded on 19.05.2018 and 08.06.2018 she has admitted that
there was no authorization in her favour to present the
complaint and that no board resolution was passed authorized
in her name, appointing her to represent the appellant-Society.
(c) That she has also admitted Ex.P1 to be a back dated
document clearly establishing that a appellant-Society has
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resorted to fabricating the document, which the trial Court has
rightly taken note of.
(d) He relies upon the judgment of the Co-ordinate Bench
of this Court, in the case of Dr. Uma Gangadhar Vs. Classic
Coffee and Spices Pvt. Ltd., Chikkamagaluru reported in
(2001)6 Kant LJ 193, referring to paragraph Nos.8 and 9 of
the said judgment, he submits that a valid sanction and
authorization is essential to launch a prosecution without which
the entire proceeding stands vitiated.
(e) That the trial Court apart from the issue of
authorization has also adverted to merits of the case. That the
loan documents furnished by the appellant-society had inherent
defects in the nature of differences in the signature of the
borrower and some of the loan documents did not contain the
name of accused-respondent to be the guarantor. Some of the
documents where the name of accused-respondent was shown
as a guarantor were incomplete.
(f) That in the order sheet maintained by the Additional
Registrar of Cooperative Society, there is no mention of the
cheque number or the amount to which the cheques having
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been issued. Even in the authorization at Ex.P1 or in the
resolution, there is no details of the cheques issued by the
accused- respondent.
(g) All that the accused-respondent required is to make
out a probable defence and she need not even enter the
witness box, which the accused-respondent herein has done
successfully in the instant case and the trial Court is justified in
acquitting her warranting no interference at the hands of this
Court.
Hence seeks for dismissal of the appeal.
11. Heard and perused the records.
12. Points that arise for consideration are;
(i) Whether the accused-respondent had issued the
Cheque bearing No.003171 dated 30.07.2016 towards
discharge of legally recoverable debt?
(ii) Whether the judgment and order passed by the trial
Court acquitting the accused-respondent is justified?
(iii) What Order?
13. The facts of the case narrated above do not require
reiteration.
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14. The trial Court in the impugned judgments while
acquitting the accused-respondent has held;
(a) that PW1 was not duly authorized by the CEO of the
appellant-Society. That though subsequent board resolution
extracts were produced, there was no specific resolution in
favour of the Manager of the appellant-Society to file the case
on hand. As such, it is held PW1-Manager at the appellant-
Society was not authorized as she did not have valid
authorization.
(b) That though the PW1 has admitted in the cross
examination regarding accused-respondent having given the
cheque after filing of the dispute before the ARCS, she has not
produced document to show that the accused-respondent had
given the alleged cheque towards discharge of the liability as a
guarantor.
(c) That the appellant-Society ought to have issued a
notice to the accused-respondent before presenting the cheque,
calling upon him to maintain the sufficient balance to honor the
cheque. That in the absence of issuance of such cheque,
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appellant-Society could not have expected the accused-
respondent to maintain the cheque amount.
(d) That PW1 has admitted that regarding clearance of
loan account No.OEL-687 and VL-71 subsequent to filing of the
case and that the cheque amount covers the said two loan
transactions, which has not been brought to the notice of the
trial Court.
(e) That accused-respondent is neither a borrower nor a
guarantor of loan VL-71. As such, the said cheque could not
have been used for the said loan.
(f) Though, as per Ex.P10-loan application of VL-55
obtained by one Smt. Shobha to which accused-respondent is a
guarantor, no vehicles are hypothecated and relevant column is
left blank.
(g) As per Ex.P26 loan pertaining VL-86 accused-
respondent is shown as borrower, no tangible property is
shown to be hypothecated.
(h) That since the appellant-Society has not issued
notice before presenting the cheque for encashment of entire
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loan including the loan account of Smt. Sujatha, to which
neither she is a borrower nor a guarantor. It is difficult to
accept, accused-respondent to maintain sufficient balance in
her account.
(i) That the above circumstances would prove the defence
putforth by the accused-respondent that she did not issue the
cheque towards discharge of the debt to be probable and
convincing.
Based on the above reasoning, trial Court has proceeded
to acquit the accused-respondent.
15. Before adverting to the submissions and the
reasoning assigned by the trial Court as noted above, it is
relevant to encapsulate few judgments of the Hon’ble Apex
Court on the settled position of law regarding the statutory
presumptions available to the appellant-Society. In the case of
Sanjabji Tari Vs. Kishore S. Borcar and another reported in
(2025) SCC Online 2069, the Hon’ble Apex Court at
paragraph Nos.11 to 18, 29 and 30 has held as under:
”11. Having heard learned counsel for the parties, this court is
of the view that it is essential to first outline the scope and
intent of Chapter XVII (sections 138 to 148) of the Negotiable
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Instruments Act, which has been inserted by Act, 66 of 1988
with effect from April 1, 1989.
12. The Statement of Objects and Reasons of Act, 66 of 1988
states, “.. . to enhance the acceptability of cheques in
settlement of liabilities by making the drawer liable for penalties
in case of bouncing of cheques due to insufficiency of funds in
the accounts or for the reason that it exceeds the arrangements
made by the drawer, with adequate safeguards to prevent
harassment of honest drawers.”
13. The provisions contained in Chapter XVII provide that
where any cheque drawn by a person for the discharge of any
liability is returned by the bank unpaid for the reason of the
insufficiency of the amount of money standing to the credit of
the account on which the cheque was drawn or for the reason
that it exceeds the arrangements made by the drawer of the
cheque with the banker for that account, the drawer of such
cheque shall be deemed to have committed an offence. In that
case, the drawer, without prejudice to the other provisions of
the said Act, shall be punishable with imprisonment for a term
which may extend to two years, or with fine which may extend
to twice the amount of the cheque, or with both.
14. Consequently, this court is of the view that the intent
behind introducing Chapter XVII is to restore the credibility of
cheques as a trustworthy substitute for cash payment and to
promote a culture of using cheques. Further, by criminalizing
the act of issuing cheques without sufficient funds or for other
specified reasons, the law promotes financial discipline,
discourages irresponsible practices and allows for a more
efficient and timely resolution of disputes compared to the
previous pure civil remedy which was found to involve the
payee in a long-drawn out process of litigation.
Once execution of cheque is admitted, presumptions under
sections 118 and 139 of the Negotiable Instruments Act, arise
15. In the present case, the cheque in question has admittedly
been signed by respondent No. 1-accused. This court is of the
view that once the execution of the cheque is admitted, the
presumption under section 118 of the Negotiable Instruments
Act, that the cheque in question was drawn for consideration
and the presumption under section 139 of the Negotiable
Instruments Act, that the holder of the cheque received the said
cheque in discharge of a legally enforceable debt or liability
arise against the accused. It is pertinent to mention that
observations to the contrary by a two-judge Bench in Krishna
Janardhan Bhat v. Dattatraya G. Hegde [(2008) 141 Comp Cas
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665 (SC); (2008) 4 SCC 54; (2008) 2 SCC (Cri) 166; 2008 SCC
OnLine SC 106.] have been set aside by a three-judge Bench in
Rangappa v. Sri Mohan [(2010) 11 SCC 441; (2010) 4 SCC
(Civ) 477; (2011) 1 SCC (Cri) 184; 2010 SCC OnLine SC 583.] .
16. This court is further of the view that by creating this
presumption, the law reinforces the reliability of cheques as a
mode of payment in commercial transactions.
17. Needless to mention that the presumption contemplated
under section 139 of the Negotiable Instruments Act, is a
rebuttable presumption. However, the initial onus of proving
that the cheque is not in discharge of any debt or other liability
is on the accused/drawer of the cheque (see : Bir Singh v.
Mukesh Kumar [(2019) 5 Comp Cas-OL 560 (SC); (2019) 4
SCC 197; (2019) 2 SCC (Cri) 40; (2019) 2 SCC (Civ) 309; 2019
SCC OnLine SC 138.] .
18. The judgment of this court in APS Forex Services P. Ltd. v.
Shakti International Fashion Linkers [(2020) 12 SCC 724;
(2020) 4 SCC (Cri) 505; 2020 SCC OnLine SC 193.] relied upon
by learned counsel for respondent No. 1-accused only says that
the presumption under section 139 of the Negotiable
Instruments Act is rebuttable and when the same is rebutted,
the onus would shift back to the complainant to prove his
financial capacity, more particularly, when it is a case of giving
loan by cash. This judgment nowhere states, as was sought to
be contended by learned counsel for respondent No. 1-accused,
that in cases of dishonour of cheques, in lieu of cash loans, the
presumption under section 139 of the Negotiable Instruments
Act does not arise.
Approach of some courts below to not give effect to the
presumptions under sections 118 and 139 of the Negotiable
Instruments Act, is contrary to mandate of Parliament
29. Furthermore, the fact that the accused has failed to reply to
the statutory notice under section 138 of the Negotiable
Instruments Act, leads to an inference that there is merit in the
appellant-complainant’s version. This court in Tedhi Singh v.
Narayan Dass Mahant [(2022) 6 SCC 735; (2022) 2 SCC (Cri)
726; (2022) 3 SCC (Civ) 442; 2022 SCC OnLine SC 302.] has
held that the accused has the initial burden to set up the
defence in his reply to the demand notice that the complainant
did not have the financial capacity to advance the loan. The
relevant portion of the said judgment is reproduced hereinbelow
[ See page 740 of (2022) 6 SCC.] :
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“10. The proceedings under section 138 of the
Negotiable Instruments Act, is not a civil suit. At the
time, when the complainant gives his evidence, unless a
case is set up in the reply notice to the statutory notice
sent, that the complainant did not have the wherewithal,
it cannot be expected of the complainant to initially lead
evidence to show that he had the financial capacity. To
that extent, the courts in our view were right in holding
on those lines. However, the accused has the right to
demonstrate that the complainant in a particular case did
not have the capacity and therefore, the case of the
accused is acceptable which he can do by producing
independent materials, namely, by examining his
witnesses and producing documents. It is also open to
him to establish the very same aspect by pointing to the
materials produced by the complainant himself. He can
further, more importantly, achieve this result through
the cross-examination of the witnesses of the
complainant. Ultimately, it becomes the duty of the
courts to consider carefully and appreciate the totality of
the evidence and then come to a conclusion whether in
the given case, the accused has shown that the case of
the complainant is in peril for the reason that the
accused has established a probable defence.”
30. This court in M.M.T.C. Ltd. v. Medchl Chemicals and Pharma
P. Ltd. [(2002) 108 Comp Cas 48 (SC); (2002) 1 SCC 234;
2002 SCC (Cri) 121; 2001 SCC OnLine SC 1364.] has
specifically held that when a statutory notice is not replied, it
has to be presumed that the cheque was issued towards the
discharge of liability.
16. In the case of Ashok Singh Vs. State of Uttar
Pradesh reported in 2025 Live Law (SC) 383, at paragraph
Nos. 15 to 17 has held as under:
”15. There can be no dispute that in matters relating to alleged
offences under Section 138 of the Act, the complainant has only
to establish that the cheque was genuine, presented within time
and upon it being dishonoured, due notice was sent within 30
days of such dishonour, to which re-payment must be received
within 15 days, failing which a complaint can be preferred by
the complainant within one month as contemplated under
Section 142 (1)(b) of the Act.
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16. On the other hand, the foremost defence available to the
accused is to deny the very liability to pay the amount for which
the cheque was issued on the ground that it was not a ‘legally
enforceable debt’ under the Act.
17. In the present case, there is no denial apropos the
signature on the cheque by the respondent no.2 and, as noted
hereinbefore, the stand taken is that the said cheque was lost.
This is the reason given by the respondent no.2 to have advised
the bank to stop payment due to which the cheque in question
was not honoured/encashed. However, the relevant dates beg
to tell a different tale. The cheque in question dated 17.03.2010
was presented within time but returned un-encashed on
07.05.2010 with the endorsement ‘payment stopped by
drawer’. A Legal Notice was also sent by the appellant on
18.05.2010 through Registered Post, i.e., within the stipulated
thirty days period, intimating about the dishonour of the
cheque. As no reply was proffered by respondent no.2, thus, an
inference, albeit rebuttable, could arise that he had no
sustainable/valid defence to justify why the cheque in question
was dishonoured. Be that as it may, the respondent no.2 avers
that no reply was sent as he had not received any Legal Notice.
”
17. In the case of Rajesh Jain Vs. Ajay Singh reported
in (2023) 10 SCC 148, at paragraph Nos.28, 29 and 32 to 37
has held as under:
” Burden of proof and presumptions : Conceptual underpinnings
28. There are two senses in which the phrase “burden of proof”
is used in the Evidence Act, 1872 (“the 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 Kundan Lal Rallaram v. Custodian (Evacuee Property)
[Kundan Lal Rallaram v. Custodian (Evacuee Property), 1961
SCC OnLine SC 10 : AIR 1961 SC 1316] .]
29. 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
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to the appropriate standards, he would lose to stand. The
incidence of the burden is usually clear from the pleadings and
usually, it 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
Edn. 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 Sifuddin Quadri [G. Vasu v.
Syed Yaseen Sifuddin Quadri, 1986 SCC OnLine AP 147 : AIR
1987 AP 139] affirmed in Bharat Barrel & Drum Mfg. Co. v.
Amin Chand Payrelal [Bharat Barrel & Drum Mfg. Co. v. Amin
Chand Payrelal, (1999) 3 SCC 35] .]
32. 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 Sifuddin Quadri [G. Vasu v. Syed Yaseen
Sifuddin Quadri, 1986 SCC OnLine AP 147 : AIR 1987 AP 139] ]
Section 139, NI Act-Effect of presumption and shifting of onus
of proof
33. 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 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. [ The rules discussed hereinbelow
are common to both the presumptions under Section 139 and
Section 118 and are hence, not repeated–reference to one can
be taken as reference to another]
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34. 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”.
35. 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 about
the activation of the presumptive clause. [Bharat Barrel & Drum
Mfg. Co. v. Amin Chand Payrelal [Bharat Barrel & Drum Mfg.
Co. v. Amin Chand Payrelal, (1999) 3 SCC 35] ]
36. 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 [Bir Singh v. Mukesh Kumar, (2019) 4 SCC 197 : (2019)
2 SCC (Civ) 309 : (2019) 2 SCC (Cri) 40] ]. 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.
37. 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.
18. In the case of Hithan B. Dalal Vs. Brathindranath
Banerjee reported in (2001) 6 SCC 16, wherein at paragraph
Nos.21 to 24 has held as under:
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” 21. The appellant’s submission that the cheques were not
drawn for the “discharge in whole or in part of any debt or other
liability” is answered by the third presumption available to the
Bank under Section 139 of the Negotiable Instruments Act. This
section provides that:
“139. It shall be presumed, unless the contrary is proved,
that the holder of a cheque received the cheque, of the
nature referred to in Section 138 for the discharge, in whole
or in part, of any debt or other liability.”
The effect of these presumptions is to place the evidential
burden on the appellant of proving that the cheque was not
received by the Bank towards the discharge of any liability.
22. Because both Sections 138 and 139 require that the court
“shall presume” the liability of the drawer of the cheques for the
amounts for which the cheques are drawn, as noted in State of
Madras v. A. Vaidyanatha Iyer [AIR 1958 SC 61 : 1958 Cri LJ
232] 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. “It introduces an exception
to the general rule as to the burden of proof in criminal cases
and shifts the onus on to the accused.” (Ibid. at p. 65, para
14.) Such a presumption is a presumption of law, as
distinguished from a presumption of fact which describes
provisions by which the court “may presume” a certain state of
affairs. Presumptions are rules of evidence and do not conflict
with the presumption of innocence, because by the latter, all
that is meant is that the prosecution is obliged to prove the
case against the accused beyond reasonable doubt. The
obligation on the prosecution may be discharged with the help
of presumptions of law or fact unless the accused adduces
evidence showing the reasonable possibility of the non-
existence of the presumed fact.
23. In other words, provided the facts required to form the
basis of a presumption of law exist, no discretion is left with the
court but to draw the statutory conclusion, but this does not
preclude the person against whom the presumption is drawn
from rebutting it and proving the contrary. A fact is said to be
proved when,
“after considering the matters before it, the court either
believes it to exist, or considers its existence so probable that a
prudent man ought, under the circumstances of the particular
case, to act upon the supposition that it exists” [ Section 3,
Evidence Act] .
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Therefore, the rebuttal does not have to be conclusively
established but such evidence must be adduced before the
court in support of the defence that the court must either
believe the defence to exist or consider its existence to be
reasonably probable, the standard of reasonability being that of
the “prudent man”.
24. Judicial statements have differed as to the quantum of
rebutting evidence required. In Kundan Lal Rallaram v.
Custodian, Evacuee Property [AIR 1961 SC 1316] this Court
held that the presumption of law under Section 118 of the
Negotiable Instruments Act could be rebutted, in certain
circumstances, by a presumption of fact raised under Section
114 of the Evidence Act. The decision must be limited to the
facts of that case. The more authoritative view has been laid
down in the subsequent decision of the Constitution Bench in
Dhanvantrai Balwantrai Desai v. State of Maharashtra [AIR
1964 SC 575 : (1964) 1 Cri LJ 437] where this Court reiterated
the principle enunciated in State of Madras v. Vaidyanatha Iyer
[AIR 1958 SC 61 : 1958 Cri LJ 232] and clarified that the
distinction between the two kinds of presumption lay not only in
the mandate to the court, but also in the nature of evidence
required to rebut the two. In the case of a discretionary
presumption the presumption if drawn may be rebutted by an
explanation which “might reasonably be true and which is
consistent with the innocence” of the accused. On the other
hand in the case of a mandatory presumption
“the burden resting on the accused person in such a case would
not be as light as it is where a presumption is raised under
Section 114 of the Evidence Act and cannot be held to be
discharged merely by reason of the fact that the explanation
offered by the accused is reasonable and probable. It must
further be shown that the explanation is a true one. The words
‘unless the contrary is proved’ which occur in this provision
make it clear that the presumption has to be rebutted by ‘proof’
and not by a bare explanation which is merely plausible. A fact
is said to be proved when its existence is directly established or
when upon the material before it the court finds its existence to
be so probable that a reasonable man would act on the
supposition that it exists. Unless, therefore, the explanation is
supported by proof, the presumption created by the provision
cannot be said to be rebutted”. (AIR p. 580, para 12)”
19. Thus as seen above, settled principles of law
repeatedly reiterated by the Hon’ble Apex Court is that once
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signature and issuance of a cheque is admitted, the statutory
presumption has to be necessarily drawn in favour of the
complainant. Though the accused is entitled for rebuttal of the
same, the rebuttal has to be specific, cogent, acceptable and
true. It cannot be a mere denial or in the nature of general
suggestions.
20. The aforesaid enunciation of law by the Hon’ble Apex
Court also emphasizes that the accused is required to place her
defence at the earliest, i.e., by issuing reply to the statutory
notice issued by the complainant.
21. In the instant case, there is no dispute of accused-
respondent having borrowed loan of Rs.30,00,000/- vide loan
account No.OEL-687, this is evident from Ex.P7-loan
application. Ex.P8-demand pro-note, Ex.P9-reciept.
22. She has offered herself as surety No.2, in respect of
loan amount of Rs.15,00,000/- borrowed by one Smt. Shobha
vide loan account No.VL-55 vide Ex.P10, demand pro-note-
Ex.P11 and Ex.P12-reciept.
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23. She has also borrowed a loan of Rs.30,00,000/- vide
loan account No.VL-86 as per Ex.P13. The demand pro-note-
Ex.P14 and Ex.P15-reciept.
24. There is also no dispute of the fact that the accused-
respondent has indeed issued the cheque in question. There is
also no dispute of the fact that the appellant-Society had
initiated proceedings under Section 70 of the Co-operative
Societies Act against the accused-respondent and others in a
case No.ARD/UBF/649/2015-16, No.ARD/UBF650/2015-16,
No.ARD/UBF/684/2015-16 for the recovery of the due amounts
produced at Exs.P24, P25; P34 and P35; P40 and P41
respectively.
25. That the respondent-accused and others have
appeared and were represented through their respective
counsel. In the above said proceedings. The daily order sheet
maintained in the said proceeding, more particularly, of
04.03.2016 read as under:
“¥ÀæPÀgÀt PÀgɸÀ¯Á¬ÄvÀÄ. ªÁ¢ ºÁUÀÆ ¥ÀgÀ ªÀQîgÀÄ ºÁdj. ¥ÀæwªÁ¢-2
ºÁUÀÆ ¥ÀgÀ ªÀQîgÀÄ ºÁdj. G½zÀªÀgÀÄ UÉÊgÀÄ. Dgï-2gÀªÀgÀÄ PÁ¯ÁªÀPÁ±À
¤rzÀÝ°è, ¥ÀÆtð ¸Á® ¥ÁªÀw¸ÀĪÀÅzÁV w½¹zÀÝgÀ ªÉÄÃgÉUÉ, Dgï.gÀªÀgÀ
DPÉëÃ¥ÀuÉUÁV ºÁUÀÆ ªÁ¢AiÀÄ ¸ÁPÀëöåPÁÌV ¥ÀæPÀgÀtªÀ£ÀÄß ¢£ÁAPÀ:
16.03.2016gÀ ªÀÄzsÁºÀß 3.00 UÀAmÉUÉ ªÀÄÄAzÀÆqÀ¯Á¬ÄvÀ”.
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26. There is no dispute with regard to the aforesaid
Order passed by the Additional Registrar of Cooperative
Society.
27. Clearly, the accused-respondent who participated in
the dispute under Section 70 of the Karnataka Cooperative
Societies Act, before the Additional Registrar of Cooperative
Society was conscious of the submissions made and
undertaking given by him for repayment of the outstanding
loan amount.
28. The notice issued as required under Section 138 of
N.I. Act, has admittedly been received by the accused-
respondent and she has not issued any reply to the same.
29. These admitted facts supported by the documents
compel the Court to draw the mandatory presumption available
under the law, regarding accused-respondent having issued the
cheque towards the discharge of legally recoverable debt.
30. The lengthy line of cross-examination adopted by the
accused-respondent indicate that the dispute raised by her is
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predominantly with regard to the lack of authorization by the
appellant-Society in favour of PW1.
31. Learned counsel for the accused-respondent referred
to the portions of deposition of PW1 recorded on 08.03.2017 in
C.C.No.22063/2016 and the cross-examination in
C.C.No.22088/2016 recorded on 19.05.2018 and 08.06.2018,
the said portions are extracted hereunder for immediate
perusal:
Cross-examination recorded on 08.03.2017 in
C.C.No.22063/2016:
” It is true that resolution has not been passed in the board
meeting authorizing me to file complaint and conduct the case.
It is not true to suggest that I have not been given proper
authorization to conduct the case.”Cross-examination recorded on 19.05.2018:
” ಸ EZÁÑ ೇ ೆಯ ೊ ೆ ೆ ಅ ಾರ ಪತ ವನು ಾಜರುಪ ೇ ೆ. ಸದ ಅ ಾರ ಪತ ವ!
ದೂರು ಾಖ#ಸುವ ಸಂದಭ&ದ#’ ಇ)ದ*ೆ ಅದನು ದೂ ನ ೊತ ೆ ಾಜರುಪ ಸು+, ೆ ಎಂದ*ೆ .ಾ/
ಆ ಸಮಯ ೆ2 ಅ ಾರ ಪತ ಇರ#ಲ’ ಎಂದು ನು ಯು ಾ,*ೆ. ನಂತರ ಸ ಇ4ಾ5 ೇ ೆಯ ಸಮಯದ#’
ಅ ಾರ ಪತ ವನು ಪ6ೆದು ೊಂಡು ಾ89ಾಲಯ ೆ2 ಾಜರುಪ ೇ ೆ ಎಂದ*ೆ ಸ . ಸದ
ಅ ಾರ ಪತ ವನು ).05.09.2016 ಎಂದು :ಂ)ನ ) ಾಂಕವನು ನಮೂ) ಪ6ೆದು ೊಂ ೇ ೆ
ಎಂದ*ೆ ಸ .”Cross-examination recorded on 08.06.2018:
”.. ೇಸು ಾಖಲು <ಾಡು=ಾಗ ?ೋ@& *ೆಸಲೂ8ಶB ಅಥ=ಾ ?ೋ@& *ೆಸಲೂ8ಶB ಎ ಾDEFನು
ಾಜರುಪ ಲ’ ಎಂದ*ೆ ಸ . .ಾ/ಯು ಮುಂದುವ*ೆದು ನಂತರ ಆತ*ೈ.ೆಶB ಾಜರುಪ ೇ=ೆ,
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?ೋ@& *ೆಸಲೂ8ಶB ಾಜರುಪ ಲ’ ಎಂದು ನು ಯು ಾ,*ೆ. ಆ )ನ ?ೋ@& *ೆಸಲೂ8ಶB ನಮH
ಬ ಇ)ದ*ೆ ಅದನು J9ಾ&ದು ೊ ೆ #KF ಆL 6ಾಕೂ8MಂNO ನು ನಮೂ)ಸಲು ೊಂದ*ೆ
ಇರ#ಲ’ ಎಂದ*ೆ ನಮH ಬ ಾಖPೆ ಇತು,, ಆದ*ೆ ಾಖPೆಗಳ ಪRFಯ#’ ನಮೂ) ಲ’ ಎಂದು
ನು ಯು ಾ,*ೆ.”
32. Thus referring to the aforesaid three portions of the
deposition, learned counsel for the accused-respondent
vehemently submits that document at Ex.P1 is backdated and
fabricated and cannot be relied upon. He also submitted that
the witness has admitted there being no resolution in her
name.
33. This Court is not persuaded to accept the said
submission, inasmuch as there is no dispute with regard to the
resolution dated 27.01.2015 produced at Ex.P52 as well as the
resolution dated 12.05.2015 produced at Ex.P53. In the
resolution dated 27.01.2015, after discussion of issue, the
following is recorded:
”Resolved that CEO can authorise manager to represent bank
to sign, give evidence, present or take back documents in legal
proceedings. The meeting concluded with vote of thanks.”
34. This Resolution indicates that CEO has been
authorized to further authorize manager to represent the Bank.
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35. Ex.P53-Resolution dated 12.05.2015, relevant portion
read as under:
” …. It was decided to file suit against all 16 vehicle loan
borrowers, also against Mr. Manjunath B. S. and Vasanth
Kokila, who have given cheque as guarantors to other loan
borrowers.”
36. All that the witness PW1 has stated is that the
resolution has not been passed in the board meeting
authorizing her to file the complaint. True it is that her name is
not mentioned in the said resolution. Instead, it is resolved that
the CEO to authorize the Manager. The said answer may have
to be read only to that extent and not beyond.
37. Ex.P1 is a letter of authority, issued by the CEO on
the letterhead of the appellant-Society. The date of the said
authorization is 05.09.2016. Sworn statement by way of an
affidavit is filed on 26.09.2016. It is in this context, the
deposition regarding earlier date of Ex.P1 as deposed by PW1
has to be viewed. Even assuming that PW1 has stated about
she obtaining authorization as per Ex.P1, subsequent to the
sworn statement with the prior date, in the considered view of
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this Court, same would not amount to an admission of
purported fabrication of document as sought to be made out.
38. It is necessary to note that the complainant is a Co-
operative Society incorporated exclusively for the
empowerment of the women dealing with the public money. It
is not in dispute, loan disbursed by the appellant-society was
for the purchase of the flat by the accused-respondent as well
as for business purpose in the nature of purchase of buses and
vehicles.
39. Clearly, public money has been utilised by the
borrowers and the respondent-accused. Being conscious of her
liability to repay, respondent-accused has undertaken to pay
the same.
40. Having issued the cheque in furtherance to said
undertaking, it is not justified for the accused-respondent to
take up a contrary stand on a hyper technical issue of
appellant-Society not being represented by a duly authorized
representative despite production of Exs.P1, P52 and P53 as
noted above.
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41. Though in the cross-examination, PW1 certain
suggestions have been made regarding clearance of the loan,
which have been answered in the affirmative by the PW1,
learned counsel for the appellant submits that the admissions
by PW1 were made in connivance with the accused persons and
that necessary actions in accordance with law has been
initiated against PW1 for not protecting the interest of the
appellant-Society.
42. Learned counsel for the accused-respondent
submitted that in the light of the admission by PW1, no error
can be found in the impugned judgment and order of acquittal
passed by the trial Court.
43. At the cost of repetition, it is noted that this team
along with ten others appeals being disposed off today indicate
common modus-opprendi adopted by accused-respondent
herein and accused-respondent in those appeals, of borrowing
huge amounts for the purported business purposes. The
amount is not small. It may be that there are certain minor
discrepancies in documents pertaining to loan transaction of
VL-71 for Rs.10,00,000/-, the same would be insignificant,
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considering the fact that the accused-respondent had
admittedly borrowed Rs.30,00,000/- each in loan account
Nos.OEL-687 and VL-86 and had also stood as a surety in
respect of loan account No.VL-55 in a sum of Rs.15,00,000/-.
44. The accused-respondent was required to bring on
record her contention of repaying the loan amount as
suggested to PW1 during the cross-examination. This
suggestion also indicate admission on the part of accused-
respondent of having borrowed the loan amount for herself and
having stood as a guarantor for other three loans. Thus, the
said suggestions would help and strengthen the case of the
appellant-Society of the impugned cheque having been issued
by the accused-respondent towards discharge of all the loans
45. It is relevant also at this juncture to refer to the
judgment of the Hon’ble Apex Court in the case of Haryana
State Co-operative Supply and Marketing Federation Ltd.,
Vs. Jayam Textiles and Another reported AIR 2014 SCC
1926, wherein at paragraph Nos.6 and 7 it is held as under:
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” 6. Having heard the learned counsel for the parties and after
perusing the material on record, we find that admittedly
authorisation by the Board of Directors of the appellant
Federation was not placed before the courts below. But, we
may notice that a specific averment was made by the appellant
Federation before the learned Judicial Magistrate that the said
general power of attorney had been filed in connected case
being CC No. 1409 of 1995, which has neither been denied nor
disputed by the respondents. In any case, in our opinion, if the
courts below were not satisfied, an opportunity ought to have
been granted to the appellant Federation to place the document
containing authorisation on record and prove the same in
accordance with law. This is so because procedural defects and
irregularities, which are curable, should not be allowed to
defeat substantive rights or to cause injustice. Procedure, a
handmaiden to justice, should never be made a tool to deny
justice or perpetuate injustice, by any oppressive or punitive
use.
7. In view of the fact that in spite of arbitration award against
the respondents, there was non-payment of amount by the
respondents to the appellant Federation, and also in the light of
authorisation contained in Annexure P/7, we are of the opinion
that, in the facts and circumstances of the case, an opportunity
should be given to the appellant Federation to produce and
prove the authorisation before the trial court, more so, when
money involved is public money. We, therefore, set aside the
judgments of the courts below and remit the matters back to
the trial court with a direction to conduct trial afresh taking into
consideration the authorisation placed before us and dispose of
the matter as expeditiously as possible in accordance with law.”
46. Thus the procedural defects and irregularities, if any,
should not be allowed to defeat the substantive rights and to
cause injustice. In the aforesaid case though the Hon’ble Apex
Court has remanded the matter, there is no need in the instant
case inasmuch as the documents were made available,
therefore there is no question of remanding the matter.
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47. The trial Court in the considered view of this Court
has misread the facts of the case and has wrongly applied the
principles of law, causing burden on the appellant-Society and
has further erred in going into the appreciation of the contents
of the loan documents, which is unwarranted.
48. The complainant has produced accounts statement
pertaining to loan transactions at Ex.P11 indicating
disbursement of the loan. Loan documents in the nature of
loan agreement and guarantee agreement, loan receipt at
Ex.P14, hypothecation agreement at Ex.P15 and letter issued
by the respondent -accused as per Ex.P16 undertaking to repay
the monthly EMI. These documents have been signed by both
the borrower as well as accused-respondent as guarantor. In
the Cross-examination of PW.1, except general denial nothing
is elicited. The accused-respondent has not led any evidence to
discredit the version of complainant-Society. Accused-
respondent has also not denied that the vehicles purchase of
which these loans were advanced were used by the accused-
respondent for his business.
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49. The trial Court in the absence of any serious dispute
with regard to the loan transactions and in the light of categoric
admission of disbursal of loan by the complainant-Bank in
favour of the borrower to which the accused-respondent herein
was the guarantor ought not to have gone into question of
mode and manner of repayment of loan amount. Particularly
as on the date when the cheque was issued, proceedings were
already initiated by the complainant-Bank under Section 70 of
the Karnataka Co-operative Societies Act, before the ARCS, in
which accused-respondent herein was arrayed as respondent
No.2. The trial Court in the absence of production of any
cogent evidence by the accused-respondent herein to displace
proof of execution of loan documents at Exs.P11, P14 and P15
ought not to have discredited the case of the complainant-
Bank.
50. The trial Court erred in holding that there was no
agreement between the appellant-Society and the accused-
respondent for payment of outstanding as he was a guarantor.
As such, the cheque issued was not towards discharge of
liability. Necessary to note the judgment of the Hon’ble Apex
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Court in the case of ICDS Pvt Ltd., (Supra), wherein at
paragraph Nos.8 to 11 held as under:
”8. The High Court, as noticed above, did allow the petition
upon a categorical finding that being a cheque from the
guarantor it could not be said to have been issued for the
purpose of discharging any debt or liability and the complaint
under Section 138 of the Negotiable Instruments Act, 1881,
thus cannot be maintained.
9. As noticed hereinbefore, the principal reason for quashing of
the proceeding as also the complaint by the High Court was by
reason of the fact that Section 138 of the Act provides for
issuance of a cheque to another person towards the discharge
in whole or in part of any debt or liability and on the factual
context, the High Court came to a conclusion that issuance of
the cheque cannot be correlated for the purpose of discharging
any debt or liability and as such complaint under Section 138
cannot be maintainable.
10. The language, however, has been rather specific as regards
the intent of the legislature. The commencement of the section
stands with the words “Where any cheque”. The above noted
three words are of extreme significance, in particular, by reason
of the user of the word “any” — the first three words suggest
that in fact for whatever reason if a cheque is drawn on an
account maintained by him with a banker in favour of another
person for the discharge of any debt or other liability, the
highlighted words if read with the first three words at the
commencement of Section 138, leave no manner of doubt that
for whatever reason it may be, the liability under this provision
cannot be avoided in the event the same stands returned by the
banker unpaid. The legislature has been careful enough to
record not only discharge in whole or in part of any debt but the
same includes other liability as well. This aspect of the matter
has not been appreciated by the High Court, neither been dealt
with or even referred to in the impugned judgment.
11. The issue as regards the coextensive liability of the
guarantor and the principal debtor, in our view, is totally out of
the purview of Section 138 of the Act, neither the same calls for
any discussion therein. The language of the statute depicts the
intent of the law-makers to the effect that wherever there is a
default on the part of one in favour of another and in the event
a cheque is issued in discharge of any debt or other liability
there cannot be any restriction or embargo in the matter of
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application of the provisions of Section 138 of the Act. “Any
cheque” and “other liability” are the two key expressions which
stand as clarifying the legislative intent so as to bring the
factual context within the ambit of the provisions of the statute.
Any contra-interpretation would defeat the intent of the
legislature. The High Court, it seems, got carried away by the
issue of guarantee and guarantor’s liability and thus has
overlooked the true intent and purport of Section 138 of the
Act. The judgments recorded in the order of the High Court do
not have any relevance in the contextual facts and the same
thus do not lend any assistance to the contentions raised by the
respondents.”
51. The trial Court has also found that the issuance of a
cheque as a security could not have been used by the
appellant-Society. This findings of the trial Court also contrary
to law laid down by the Hon’ble Apex Court in the case of
Sripathi Singh Vs. State of Jharkhand and another
reported in (2022) 18 SCC 614, wherein at paragraph Nos.21
held as under:
”21. 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 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 time-frame 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 the NI Act would flow.”
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52. For the aforesaid reasons and analysis and the
documentary and oral evidence produced by the complainant-
Bank, this Court is of the considered view that the complainant-
appellant-Society has proved and established that the cheques
in question were issued by the accused-respondent before
discharge of the loan. The trial Court is not justified in
acquitting the accused-respondent.
Point raised are answered accordingly.
53. Accordingly, following:
ORDER
(i) Appeal is allowed. Judgment and order dated
26.03.2021, passed in C.C.No.22088/2016 on the file
of XXVI Additional Chief Metropolitan Magistrate,
Bangalore City is set-aside.
(ii) Accused-respondent is convicted for the offences
punishable under Section 138 of the N.I. Act.
(iii) Accused-respondent shall pay the fine amount of
Rs.67,00,000/-, in default accused-respondent shall
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HC-KAR
undergo simple imprisonment for a period of one
year.
(iv) Out of the fine amount, cheque amount shall be
paid to the appellant-Society remaining shall be paid
to the State.
Sd/-
(M.G.S. KAMAL)
JUDGE
RL
List No.: 1 Sl No.: 0
