Karnataka High Court
M. P. Kumaraswamy, Former M.L.A vs H. R. Huvappa Gowda on 4 March, 2026
Author: M.Nagaprasanna
Bench: M.Nagaprasanna
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 04TH DAY OF MARCH, 2026
BEFORE
THE HON'BLE MR. JUSTICE M. NAGAPRASANNA
CRIMINAL REVISION PETITION No.1140 OF 2023
C/W
CRIMINAL REVISION PETITION No.1114 OF 2023
CRIMINAL REVISION PETITION No.1141 OF 2023
CRIMINAL REVISION PETITION No.1143 OF 2023
CRIMINAL REVISION PETITION No.1145 OF 2023
CRIMINAL REVISION PETITION No.1147 OF 2023
CRIMINAL REVISION PETITION No.1153 OF 2023
CRIMINAL REVISION PETITION No.1155 OF 2023
IN CRIMINAL REVISION PETITION No.1140 OF 2023
BETWEEN:
M.P.KUMARASWAMY, FORMER M.L.A.,
S/O LATE PUTTAIAH
AGED ABOUT 56 YEARS
R/O I-SECTOR, H.S.R.LAYOUT
HOSUR - SARJAPURA ROAD
BENGALURU - 20.
... PETITIONER
(BY SRI VYDHYANATHA S. S., ADVOCATE)
AND:
H.R.HUVAPPA GOWDA
S/O LATE RAME GOWDA
2
AGED ABOUT 49 YEARS
AGRICULTURIST
R/O HOUSE NO. 152
CHANNAPURA ROAD, FORT
CHIKKAMAGALURU CITY - 577 101.
... RESPONDENT
(BY SRI MANJUNATH PRASAD H.N., ADVOCATE)
THIS CRIMINAL REVISION PETITION IS FILED UNDER
SECTION 397 READ WITH SECTION 401 OF THE CRIMINAL
PROCEDURE CODE 1908, AGAINST SETTING ASIDE THE
IMPUGNED JUDGMENT DATED 19.07.2023 PASSED IN
CRL.A.NO.329/2023 ON THE FILE OF THE HON'BLE COURT OF
LXXXI ADDL.CITY CIVIL AND SESSIONS JUDGE, BENGALURU CCH-
82 AND CONSEQUENTLY SET ASIDE THE JUDGMENT DATED
13.02.2023 PASSED IN C.C.NO.33472/2021 ON THE FILE OF
HON'BLE 42ND A.C.M.M, BENGALURU.
IN CRIMINAL REVISION PETITION No.1114 OF 2023
BETWEEN:
M.P.KUMARASWAMY, FORMER M.L.A.,
S/O LATE PUTTAIAH
AGED ABOUT 56 YEARS
R/O I-SECTOR, H.S.R, LAYOUT
HOSUR - SARJAPURA ROAD
BENGALURU - 20.
... PETITIONER
(BY SRI VYDHYANATHA S. S., ADVOCATE)
AND:
H.R.HUVAPPA GOWDA
3
S/O LATE RAME GOWDA
AGED ABOUT 49 YEARS
AGRICULTURIST, R/O HOUSE NO. 152
CHANNAPURA ROAD, FORT
CHIKKAMAGALURU CITY - 577 201.
... RESPONDENT
(BY SRI MANJUNATH PRASAD H. N., ADVOCATE)
THIS CRIMINAL REVISION PETITION IS FILED UNDER
SECTION 397 READ WITH SECTION 401 OF THE CRIMINAL
PROCEDURE CODE 1908, AGAINST TO SETTING ASIDE THE
IMPUGNED JUDGMENT DATED 19.07.2023 PASSED IN CRIMINAL
APPEAL NO.328/2023 ON THE FILE OF THE HON'BLE COURT OF
LXXXI ADDITIONAL CITY CIVIL AND SESSIONS JUDGE,
BANGALORE, CCH-82 AND CONSEQUENTLY SET ASIDE THE
JUDGMENT DATED 13.02.2023 PASSED IN C.C.NO.33469/2021 ON
THE FILE OF HON'BLE 42ND ADDITIONAL CHIEF METROPOLITAN
MAGISTRATE, BANGALORE.
IN CRIMINAL REVISION PETITION No.1141 OF 2023
BETWEEN:
M.P.KUMARASWAMY, FORMER M.L.A.,
S/O LATE PUTTAIAH
AGED ABOUT 56 YEARS
R/O I-SECTOR, H.S.R LAYOUT
HOSUR - SARJAPURA ROAD
BENGALURU - 20.
... PETITIONER
(BY SRI VYDHYANATHA S. S., ADVOCATE)
AND:
H.R.HUVAPPA GOWDA
S/O LATE RAME GOWDA
AGED ABOUT 49 YEARS
4
AGRICULTURIST
R/O HOUSE NO. 152
CHANNAPURA ROAD, FORT
CHIKKAMAGALURU CITY - 577 101.
... RESPONDENT
(BY SRI MANJUNATH PRASAD H. N., ADVOCATE)
THIS CRIMINAL REVISION PETITION IS FILED UNDER
SECTION 397 READ WITH SECTION 401 OF THE CRIMINAL
PROCEDURE CODE 1908, AGAINST SETTING ASIDE THE
IMPUGNED JUDGMENT DATED 19.07.2023 PASSED IN
CRL.A.NO.331/2023 ON THE FILE OF THE HON'BLE COURT OF
LXXXI ADDL. CITY CIVIL AND SESSIONS JUDGE, BENGALURU CCH-
82 AND CONSEQUENTLY SET ASIDE THE JUDGMENT DATED
13.02.2023 PASSED IN C.C.NO.33479/2021 ON THE FILE OF
HON'BLE 42ND A.C.M.M, BENGALURU.
IN CRIMINAL REVISION PETITION No.1143 OF 2023
BETWEEN:
M.P.KUMARASWAMY, FORMER M.L.A.,
S/O LATE PUTTAIAH
AGED ABOUT 56 YEARS
R/O I-SECTOR, H.S.R LAYOUT
HOSUR - SARJAPUR ROAD, BENGALURU -
20.
... PETITIONER
(BY SRI VYDHYANATHA S. S., ADVOCATE)
AND:
H.R.HUVAPPA GOWDA
S/O LATE RAME GOWDA
AGED ABOUT 49 YEARS
AGRICULTURIST, R/O HOUSE NO.152
CHANNAPURA ROAD, FORT
5
CHIKKAMAGALURU CITY - 577 101.
... RESPONDENT
(BY SRI MANJUNATH PRASAD H. N., ADVOCATE)
THIS CRIMINAL REVISION PETITION IS FILED UNDER
SECTION 397 READ WITH SECTION 401 OF THE CRIMINAL
PROCEDURE CODE 1908, AGAINST SETTING ASIDE THE
IMPUGNED JUDGMENT DATED 19.07.2023 PASSED IN
CRL.A.NO.327/2023 ON THE FILE OF THE HON'BLE COURT OF
LXXXI ADDL.CITY CIVIL AND SESSIONS JUDGE, BENGALURU CCH-
82 AND CONSEQUENTLY SET ASIDE THE JUDGMENT DATED
13.02.2023 PASSED IN C.C.NO.33476/2021 ON THE FILE OF
HON'BLE 42ND A.C.M.M, BENGALURU.
IN CRIMINAL REVISION PETITION No.1145 OF 2023
BETWEEN:
M.P.KUMARASWAMY, FORMER M.L.A.,
S/O LATE PUTTAIAH
AGED ABOUT 56 YEARS
R/O I-SECTOR, H.S.R.LAYOUT
HOSUR - SARJAPUR ROAD
BENGALURU - 20.
... PETITIONER
(BY SRI VYDHYANATHA S.S., ADVOCATE)
AND:
H.R.HUVAPPA GOWDA
S/O LATE RAME GOWDA
AGED ABOUT 49 YEARS
AGRICULTURIST
R/O HOUSE NO.152
CHANNAPURA ROAD FORT
6
CHIKKAMAGALURU CITY - 577101.
... RESPONDENT
(BY SRI MANJUNATH PRASAD H. N., ADVOCATE)
THIS CRIMINAL REVISION PETITION IS FILED UNDER
SECTION 397 READ WITH SECTION 401 OF THE CRIMINAL
PROCEDURE CODE 1908, AGAINST SET ASIDE THE IMPUGNED
JUDGMENT DATED 19.07.2023 PASSED IN CRL.A.NO.330/2023 ON
THE FILE OF LXXXI ADDITIONAL CITY CIVIL AND SESSIONS
JUDGE, BENGALURU, CCH-82 AND CONSEQUENTLY SET ASIDE THE
JUDGMENT DATED 13.02.2023 PASSED IN C.C.NO.33255/2021 ON
THE FILE OF HON'BLE XLII ADDL.C.M.M., BENGALURU.
IN CRIMINAL REVISION PETITION No.1147 OF 2023
BETWEEN:
M.P.KUMARASWAMY, FORMER M.L.A.,
S/O LATE PUTTAIAH
AGED ABOUT 56 YEARS
R/O I-SECTOR, H.S.R. LAYOUT
HOSUR - SARJAPURA ROAD
BENGALURU - 20.
... PETITIONER
(BY SRI VYDHYANATHA S. S., ADVOCATE)
AND:
H.R.HUVAPPA GOWDA
S/O LATE RAME GOWDA
AGED ABOUT 49 YEARS
AGRICULTURIST
R/O HOUSE NO. 152
CHANNAPURA ROAD, FORT
CHIKKAMAGALURU CITY.
... RESPONDENT
7
(BY SRI MANJUNATH PRASAD H. N., ADVOCATE)
THIS CRIMINAL REVISION PETITION IS FILED UNDER
SECTION 397 READ WITH SECTION 401 OF THE CRIMINAL
PROCEDURE CODE 1908, AGAINST SETTING ASIDE THE
IMPUGNED JUDGMENT DATED 19.07.2023 PASSED IN
CRL.A.NO.332/2023 ON THE FILE OF THE HON'BLE COURT OF
LXXXI ADDITIONAL CITY CIVIL AND SESSIONS JUDGE,
BENGALURU CCH-82 AND CONSEQUENTLY SET ASIDE THE
JUDGMENT DATED 13.02.2023 PASSED IN C.C.NO.33245/2021 ON
THE FILE OF THE HON'BLE 42nd ADDITIONAL CHIEF METROPOLITAN
MAGISTRATE BENGLAURU FOR OFFENCE PUNISHABLE UNDER
SECTION 138 OF N.I.ACT.
IN CRIMINAL REVISION PETITION No.1153 OF 2023
BETWEEN:
M.P.KUMARASWAMY, FORMER M.L.A.,
S/O LATE PUTTAIAH
AGED ABOUT 56 YEARS
R/O I-SECTOR, H.S.R. LAYOUT
HOSUR - SARJAPURA ROAD
BENGALURU - 20
... PETITIONER
(BY SRI VYDHYANATHA S. S., ADVOCATE)
AND:
H.R.HUVAPPA GOWDA
S/O LATE RAME GOWDA
AGED ABOUT 49 YEARS
AGRICULTURIST
R/O HOUSE NO. 152
CHANNAPURA ROAD, FORT
CHIKKAMAGALURU CITY - 577 101.
... RESPONDENT
(BY SRI MANJUNATH PRASAD H. N., ADVOCATE)
8
THIS CRIMINAL REVISION PETITION IS FILED UNDER
SECTION 397 READ WITH SECTION 401 OF THE CRIMINAL
PROCEDURE CODE 1908, AGAINST SETTING ASIDE THE
IMPUGNED JUDGMENT DATED 19.07.2023 PASSED IN CRIMINAL
APPEAL NO.325/2023 ON THE FILE OF THE HON'BLE COURT OF
LXXXI ADDITIONAL CITY CIVIL AND SESSIONS JUDGE,
BANGALORE-CCH-82 AND CONSEQUENTLY SET ASIDE THE
JUDGEMENT DATED 13.02.2023 PASSED IN C.C.NO.33240/2021
ON THE FILE OF HON'BLE 42ND ADDITIONAL CHIEF
METROPOLITAN MAGISTRATE, BANGALORE FOR THE OFFENCE
PUNISHABLE UNDER SECTION 138 OF N.I. ACT.
IN CRIMINAL REVISION PETITION No.1155 OF 2023
BETWEEN:
M.P.KUMARASWAMY, FORMER M.L.A.,
S/O LATE PUTTAIAH
AGED ABOUT 56 YEARS
R/O I-SECTOR, H.S.R.LAYOUT
HOSUR - SARJAPURA ROAD
BENGALURU - 20.
... PETITIONER
(BY SRI VYDHYANATHA S. S., ADVOCATE)
AND:
H.R.HUVAPPA GOWDA
S/O LATE RAME GOWDA
AGED ABOUT 49 YEARS
AGRICULTURIST
R/O HOUSE NO. 152
CHANNAPURA ROAD, FORT
CHIKKAMAGALURU CITY - 577 101.
... RESPONDENT
(BY SRI MANJUNATH PRASAD H. N., ADVOCATE)
9
THIS CRIMINAL REVISION PETITION IS FILED UNDER
SECTION 397 READ WITH SECTION 401 OF THE CRIMINAL
PROCEDURE CODE 1908, AGAINST SETTING ASIDE THE IMPUGNED
JUDGMENT DATED 19.07.2023 PASSED IN CRIMINAL APPEAL
NO.326/2023 ON THE FILE OF THE HON'BLE COURT OF LXXXI
ADDITIONAL CITY CIVIL AND SESSIONS JUDGE, BANGALORE-CCH-
82 AND CONSEQUENTLY SET ASIDE THE JUDGMENT DATED
13.02.2023 PASSED IN C.C.NO.33252/2021 ON THE FILE OF
HON'BLE 42ND ADDITIONAL CHIEF METROPOLITAN MAGISTRATE,
BANGALORE.
THESE CRIMINAL REVISION PETITIONS HAVING BEEN HEARD
AND RESERVED FOR ORDERS, COMING ON FOR PRONOUNCEMENT
THIS DAY, THE COURT MADE THE FOLLOWING:-
CORAM: THE HON'BLE MR JUSTICE M.NAGAPRASANNA
CAV ORDER
Conglomeration of these cases are all between the same
parties, but relate to different transactions on different
instruments/cheques issued by the accused in favour of the
complainant. The petitioner is thus before this Court calling in
question orders dated 19-07-2023 passed by the LXXXI Additional
City Civil and Sessions Judge, Bengaluru in different Criminal
10
Appeals affirming the orders dated 13-02-2023 passed by the XLII
Additional Chief Metropolitan Magistrate, Bengaluru in different C.C.
numbers. Therefore, the petitioner is before this Court calling in
question the concurrent findings recorded against him.
2. Heard Sri S.S.Vydhyanatha, learned counsel appearing for
the petitioner and Sri H.N.Manjunath Prasad, learned counsel
appearing for the respondent.
3. Facts, in brief, germane are as follows: -
3.1. The petitioner, in all these cases, is the accused. The
accused was a Member of Legislative Assembly from Mudigere
constituency for over three terms. At the relevant point in time he
had not been elected. Complainant is a native of the same
constituency and is said to be an acquaintance of the accused for
over 15 years. The acquaintance between the two led to several
financial transactions between them. The financial transactions led
to issuance of certain cheques by the accused in favour of the
complainant. The financial transactions that form the fulcrum of
11
the present lis is an amount totaling to ₹1,66,70,000/- which the
accused is said to have borrowed from the complainant on different
dates and towards assurance of repayment of the said amount the
accused had issued several cheques. The relationship between the
two appear to have turned sore. The relationship turning sore leads
the complainant to initiate proceedings under the Negotiable
Instruments Act, 1881 ('the Act' for short) by causing legal notice
upon the accused and then taking up proceedings by registering a
private complaint for offences punishable under Section 138 of the
Act. A criminal case is registered before the concerned Court and
the accused faces trial before the concerned Court.
3.2. The learned Magistrate, in terms of his order dated
13-02-2023, passes an order under Section 255(2) of the Cr.P.C
convicting the accused for the offence punishable under Section 138
of the Act and sentences him to pay a certain amount in each of the
cases. The accused who suffered conviction calls the said order of
conviction in question before the Court of Sessions in different
Criminal Appeals. The Court of Sessions rejects the appeals and
affirms the conviction of the petitioner in all the transactions. It is
12
these two orders i.e., order of conviction of the learned Magistrate
and the rejection of the criminal appeals that has driven the
petitioner to this Court in the subject petitions.
4. The amount involved in the transactions is different in each
of the cases, but the transaction is between the petitioner and the
respondent who are accused and the complainant respectively, in
all the cases.
5. The learned counsel appearing for the petitioner would
reiterate the grounds urged in the revision petition. The primary
ground urged is that, both the Courts have ignored the fact that the
complainant possess a BPL ration card which is given to families
who have income of less than ₹1,25,000/- p.a. If the complainant
was not in a capacity to lend huge sums of money and possesses a
BPL ration card, the learned counsel submits that the entire
transaction between the two is a sham. The cheques given by the
petitioner for different collateral purposes are misused by the
complainant. It is his further submission that under the Act, the
complainant can secure only the transaction amount and not any
13
fine or interest. The complainant is not a registered money lender
and is not entitled to make any transaction in law. He would
contend that all these points are not considered by both the Courts
while answering the issue against the present accused. Therefore,
both the orders - order of conviction and the order in appeals
should be obliterated.
6. Per contra, the learned counsel appearing for the
respondent/complainant would vehemently refute the submissions
contending that these very submissions were urged before the
concerned Courts. The learned Magistrate, by detailed reasons has
convicted the accused and the said conviction is affirmed in the
appeal again by a detailed order. These concurrent findings, based
on cogent reasons, can be interfered with in the revisional
jurisdiction, only if the orders are perverse or lacking in jurisdiction.
Therefore, the revisional jurisdiction of this Court is extremely
limited, unlike hearing an appeal. He would, on the merit of the
matter, contend that the BPL card was secured by the wife without
informing the complainant. The moment the complainant came to
know, the BPL card is cancelled long before the transaction. He
14
would contend that if in the event of non-payment, the concerned
Court is empowered to impose fine and also imprisonment. It
cannot be that the Court is powerless to pass necessary orders. He
would seek dismissal of these petitions.
7. I have given my anxious consideration to the submissions
made by the respective learned counsel and have perused the
material on record.
8. The afore-narrated facts and link in the chain of events are
all a matter of record. Delving deeper into the facts would not be
required, as the trial Court as well as the appellate Court have
considered the facts in their entirety and passed orders. The order
passed by the learned Magistrate in C.C.No.33472 of 2021 reads as
follows:
"REASONS
12. POINTS No.1 and 2: One of the conditions for
applicability of section 138 Of the ACT is that the cheque must
be given in discharge, in whole or part of legally enforceable
debt or liability. In order to establish the same the complainant
examined himself as PW-1. In his affidavit filed in lieu of his
chief-examination, he has testified regarding the transaction,
issuance of the cheque, dishonour of the cheque, service of the
legal notice and failure of the accused to pay the amount
15
covered under the cheque. The cheque is marked as Ex P.1, the
memo of the banker is marked as Ex.P.2, office copy of the legal
notice is marked as Ex.P.3, acknowledgments are marked as
Ex.P.4 and 5, reply dated:20-02-2020 is marked as Ex.P.6,
order sheet, complaint and cheque of CC. No. 1582/17 are
marked as Ex.p.7 to 9, order sheet, complaint and cheque of
CC.No.1584/17 are marked as Ex.p.10 to 12, complaint and
cheque of CC.No.1585/17 are marked as Ex.p.13 to 15, letter
written by the accused to the complainant on 12-10-2017 is
marked as Ex.P16 and bank statements are marked as Ex.P.17
and 18.
13. The counsel for the accused has thoroughly cross -
examined PW-1. From the sum and substance of the cross -
examination done to PW-1, it could be gathered that the
defence of the accused is that the Complainant did not have
financial capacity to lend that much money, that the accused is
not due to make any repayment to the complainant and he has
misused the cheque leaves of the accused. There is no dispute
that the accused and the complainant are known to each other.
There is also no dispute that this complainant had filed three
complaints prior to this one in respect of the cheques issued by
the accused and the same is withdrawn by the complainant as
those cases were settled.
14. The reply given by the accused to the demand notice
is marked as Ex.P6. On perusal of the same, it goes to show
that the accused has contended that false cases were filed by
the complainant. But since, he contested for the election, as per
the advice of his relatives and friends and the party workers,
they have settled the matter as the pendency of the cases will
come in the way of his election. It is also contended that the
cheque leaves are stolen and then transcripted by the
complainant. It is contented that he never borrowed any money
from the complainant.
15. Now, once again, let me go through the cross -
examination of PW-1. In the entire cross-examination, not even
a single suggestion is put to PW-1 stating that he has stolen the
cheque leaves. Not even a single suggestion is put to PW-1
stating that the friends, relatives and party workers settled
three cases which were filed earlier to this complainant. Further,
not even a single suggestion is put to PW-1 that the accused
16
has not borrowed any money from the complainant. On the
other hand, the counsel for the accused went on posing
questions to PW-1 with regard to his financial capacity of
lending money. The counsel for the accused has cross examined
PW-1 at length. Finally, it is suggested that the accused is not
due to pay any money to the complainant.
16. During the course of cross-examination of PW-1, it
was tried to elicit from his mouth with regard to payment of
income tax and also with regard to filling of IT returns and
further, with regard to the complainant holding BPL Card with
him. The complainant has not denied about possessing BPL
Card. By way of confrontation, two documents were marked.
One is the certified copy of the memo filed in earlier case which
was withdrawn by the complainant and the copy of the BPL
Card. They are marked as Ex D1 and 2.
17. During the course of arguments, it is argued by the
counsel for the accused that if really the accused was due of Rs.
26,70,000/- when the earlier cases were withdrawn and if a sum
of Rs.68,00,000/- is once again paid, the same would have
found place in Ex.D1 memo. For this line of argument, the
answer is found in the re-examination of PW-1 at Page No.9. He
has deposed that the accused requested him not to mention
about the same, as he is contesting for the election. This
evidence of PW-1 is appealable to the conscious of this court
and the same is also probable one. Usually, the contesting party
in the election, is expected to be free from criminal cases. So
there is every likelihood of the accused having told the
complainant not to mention about the loan and dues in the
memo. As such, this line of argument by the accused is not
acceptable.
18. The complainant has produced and got marked two
statements of his bank accounts as Ex.p 17 and 18. I have
carefully gone through the entries of those documents. Not even
a single question is posed to PW-1 in respect of both these
documents. There is no cross-examination to PW-1 stating that
a sum of Rs. 1,66,70,000/- is not transferred to the account of
the accused from the account of the complainant. There is no
cross-examination to PW-1 in respect of the entries of Ex.P17
and 18. On the other hand, the documents marked as Ex.P 17
17
evidences that a sum of Rs.1,40,00,000/-is repaid by the
accused to the complainant, by transferring the said sum to the
complainant's account on 06.03.2018. Ex.P18 evidences that
once again, the complainant paid a sum of Rs.68,00,000/- to
the accused through his account viz.. a sum of Rs.20,00,000/-
on 08-03-2018, Rs.15,00,000/- on 08-03-2018, Rs.8,00,000/-
on 09-03-2018, Rs.6,00,000/- on 09-03-2018, Rs.8,00,000/- on
12-03-2018, Rs.8,00,000/- оп 14-03-2018 and Rs.3,00,000/-
on 16-03-2018. As could be seen from the undisputed entries
made in Ex.P 17 and 18, it is evident that initially a sum of
Rs.1,66,70,000/- was borrowed and later, a sum of
Rs.1,40,00,000/- is repaid i.e., after filing Three Private
Complaints, accordingly, those cases were withdrawn. Later,
again a sum of Rs.68,00,000/- was borrowed and eight cheques
were issued for repayment of earlier balance of Rs.26,70.000/-
and later amount of Rs.68,00,000/- by adding interest on the
said sum. Admittedly. the complainant is not a money lender.
But from the evidence, it goes to show that the accused himself
came forward to give interest on the money borrowed by him
and accordingly, calculated the total amount due with interest
and issued eight cheques, and Ex.P1 is one among those
cheques.
19. There is no contrary evidence from the accused
either oral or documentary to disprove the case of the
complainant. No doubt, the accused has produced the
copy of the BPL Card pertaining to the family of the
accused and the same is admitted and marked as Ex.D2.
From the said document, it goes to show that the same is
obtained by the wife of the complainant by showing her
husband (complainant) and children as the family
members. The counsel for the accused has drawn the
attention of this court to the cross of PW-1, where few
questions were posed to him with regard to giving false
statement before the concerned department for obtaining
BPL Card. PW-1 has denied the suggestions put to him.
Admittedly, when the BPL Card is issued to the wife of
the complainant, for the statement or documents given
by her to the concerned department, this complainant
cannot be held responsible nor this complainant can be
treated as a person below poverty line. Moreover, when
the accused is not able to disprove the transaction
between him and the complainant and the entries in
18
Ex.P17 and 18 showing that the complainant and paid
such a huge sum of money to the accused, the accused is
debarred from contending that the complainant did not
have financial capacity to lend that much money.
20. If the complainant or his wife are not eligible
for the BPL Card and if they have still obtained the same,
then it is the look out of the concerned department to
deal with the same and it is not the scope of this case and
this court has no jurisdiction to determine about the
same. Further, the counsel for the accused has also
argued that the accused has not paid the income tax and
has not filed returns for the said amount. Again, this is
also the look out of the concerned department and the
same will not come within the jurisdiction of this court.
As such, the contention of the accused that the
complainant did not have financial capacity to lend the
money does not stand for consideration.
21. Though, lengthy cross-examination is done to PW-1,
not even a single suggestions is put to him, as to how the Ex.P1
cheque came to the hands of the complainant, though in Ex.P6
reply, it is stated that the complainant has stolen the cheque
leaves.
22. It is argued by the counsel for the accused that the
amount shown in the cheque is more than the liability and the
accused has never agreed to pay any interest. It is argued that
the complainant is a money lender and he is not holding any
licence to do the said business. Now, according to the
complainant, the cheque amount shown in Ex.P1 is Rs.
48,00,000/-. It is the case of the complainant that the accused
was due a sum of Rs. 26,70,000/- in respect of the earlier
transaction and a sum of Rs.68,00,000/- in respect of the later
transaction. And, it is his case that the accused himself agreed
to pay interest at the rate of 2% per month and he calculated
the interest and issued the 8 cheque leaves for Rs.
1,36,50,000/- and Ex.P1 is one among those cheque leaves. In
the cross-examination of PW-1 also, he has deposed that he has
not asked for any interest from the accused and he has also
deposed that he is not doing the business of money lending.
Further more, no suggestion is put to PW-1 stating that he is
doing the said business. As such, for the reasons stated above,
19
it can be said that the accused is not successful is rebutting the
presumption available to the complainant.
23. The counsel for the complainant has relied upon the
following decision:
1) AIR 2019 SC 1876, between Rohitbhai Jivanlal
Patel Vs. State of Gujarat and another.
2) LAWS (KAR) 2017-4-57, between C.N.Dinesha Vs.
C.G.Mallika.
3) AIR Online 2022 SC 1373 between P.Rasiyal Vs.
Abdul Nazer and another.
4) 2022 Live Law (SC) 979 between Jain P. Jose Vs.
Santosh and another.
5) 2022 Live Law (SC) 714 between Oriental Bank of
Commerce Vs Prabodh Kumar Tewari.
24. I have gone through all the decisions throughly. All
the authorizes are aptly applicable to the case on hand.
25. On the other hand the counsel for the accused has
relied upon the following decisions:
01) In Cr.A.No.636/2019, SC., between Basalingappa
Vs. Mudibasappa, decided on 09-04-2019.
02) In Cr.A.No.518/2006, SC., between
Krishnajanardhan Bhat Vs. Dattatraya G. Hegde, decided
on 11-01-2008.
03) In Cr.A.No.1594/2012, SC., between Rev. Mother
Marykutty Vs. Reni C. Kottaram and another, decided on
12-10-2012.
04) In Cr.A.No.298/1997, SC., between Narendra
Singh and another Vs. State of M.P., decided on 12-04-
2004.
20
05) In Cr.P.No.236/2019(A), Karnataka High Court.,
between Ashok B Dani Vs. P.R.Bhot, decided on 25-02-
2022.
06) In Cr.P.No.1649/2017, Karnataka High Court,
between T.R.Sampathu Vs. Srinivasa, decided on 25-02-
2022.
07) (2022) 2 BC 290, Karnataka High Court, between
Sri.M.Nagaraju Vs. Sri.Lokesh Bagal.
08) (2011) ACD 365, Karnataka High Court, between
Amzad Pasha Vs. H.N.Lakshmana.
09) AIR (2008) 6 KarR., 432, between Shiva OF THE
CHIER Murthy Vs. Amruthraj
10) (2001) Cri.L.J., 745, Karnataka High Court, between
B.P.Venkatesulu Vs. K.P.Mani Nayar.
11) AIR (2018) KarR 450, between Pushpa B.R., Vs. State
of Karnataka Department of Urban Development.
12) AIR (2019) BomR (Cri.) 97, between Vikas Gopi
Bhagat Vs. Shivadas Pednekar.
13) In W.P.No.16748(W)/2018, West Bengal High Court,
between Bhriguram DE Vs. State of West Bengal, decided
on 20-09-2018.
14) (2020) 3 LW 141, Madras High Court, between
Dr.C.Dharshan Vs. State of Tamil Nadu.
15) In Cri.A.No. 1978/2013, SC., between Rajaram
S/o.Sriramulu Naidu (Since deceased) through Lrs., Vs.
Maruthachalam (Since deceased) through Lrs, decided on
18.01.2023.
26. I have gone through all the decisions
thoroughly. None of them are applicable to the case on
hand. As the facts and circumstances of the cases
involved in the said decisions and the facts and
circumstances of this case are totally different. In the
21
case on hand, the accused is not successful in rebutting
the presumption available the complainant. Moreover,
the accused himself admits that the complainant had the
financial capacity to lend him money. Not only that the
complainant has produced cogent documents to show
that money was transferred to the account of the accused
and the same is not denied, which is discussed supra.
Further more, Ex.P16 is the document which will falsify
the defence of the accused that the complainant did not
have financial capacity to lend the money. Ex.P16 is the
letter written by the accused to the complainant on 12-
10-2017 i.e., after receipt of the demand notice issued by
the complainant, when the first three cheques were
dishonoured. As could be seen from the said document, it
goes to show that the accused has admitted the
transaction and also issuance of those three cheque
leaves and he has sought for time to repay the earlier
loan and requested the complainant not to proceed with
filing of the complaint. This document is also not denied
by the accused. But, in the case on hand, the accused has
questioned the financial capacity of the complainant and
has also gone to the extent of saying that he gave off a
sum of Rs.1,40,00,000/- to the complainant only to get
rid of the cases filed against him during the elections. No
prudent man will just give away such a huge amount
without any liability. This is nothing but cock and bull
story cooked up by the accused to get away from the
clutches of law and the same is not permissible.
27. From, the over all evidence on record, it goes to
show that the accused has tried to take some baseless
defence which is usually taken by the accused person in
the case of this nature. The presumption available to the
complainant is not at all rebutted by the accused. A
proceeding under section 138 of N.I Act, is quasi criminal
in nature. In these proceedings proof beyond reasonable
doubt is subject to presumptions envisaged under section
118, 139 and 146 of N.I Act. An offence under section
138 of N.I Act, is committed not on dishonour of the
cheque, but on the failure of the drawer of cheque to
make payment within 15 days from the receipt of notice
of dishonour. An essential ingredient of section 138 of N.I
22
Act, is that cheque in question must have been issued
towards a legally enforceable debt or liability.
28. At the cost of repetition, it is to be stated that
the complainant has proved the accused is due to him
and the said debt is legally recoverable debt. Section 118
and 139 of the Act, envisages certain presumptions.
Under section 118 a presumption shall be raised
regarding consideration, date, transfer, endorsement and
regarding the holder in case of Negotiable Instruments.
Even, under section 139 a rebuttable presumption shall
be raised that the cheque in question was issued
regarding discharge of a legally enforceable debt. These
presumptions are mandatory presumptions that are
required to be raised in a case of N.I Act. These
presumptions are not conclusive presumptions, but
rebuttable. Therefore, it is for the accused to show that
there was no debt or liability or that debt or liability was
not legally enforceable. It is true that the accused need
not prove his case beyond reasonable doubt, but the
defence should be such which makes the court to accept
the defence version probable. Unless, the drawer is able
to discharge the onus, an offence under section 138
would be complete provided there are no technical
defects in the prosecution.
29. Since, the accused has not discharged the
burden cast upon him. Ex.P.1 having been issued by him
and its return on the ground of "Insufficient Funds",
which was followed by a demand notice to pay the
cheque amount, the complaint having been filed within
the period of limitation and the material documents
having been exhibited during the course of trial by the
payee of the cheque, during whose cross examination
nothing material has been elicited to doubt his testimony,
the ingredients of the offence under section 138 has been
met out. The statutory presumption under section 139
has not been discharged by the accused. The reverse
burden is on the accused which he has to discharge in a
manner which is believable as well as acceptable to the
court, but the accused has not done so. Accordingly, it is
to be held that the accused has committed the offence
23
punishable under section 138 of N.I Act. As such, Points
No.1 and 2 are answered in the Affirmative.
30 Point No.3: Negotiable Instruments Act, was enacted
to bring credibility to the cheque. The very purpose of the
enactment is to promote the use of the Negotiable Instrument,
while to discourage the issuance of the cheque without having
sufficient funds in the account. Such being the case, the
intention of the legislature is that complainant be suitably
compensated while the accused be punished for his act.
31. When compensation is awarded enforcement of the
same come into question. There is no provision in the Code of
Criminal Procedure for imposing default sentence for enforcing
the payment of compensation. In this regard, the Hon'ble
Supreme Court in the decision reported in 2002 (2) SCC 420
between Suganthi Suresh Kumar Vs. Jagadeeshan was
pleased to hold that "the court may enforce the order by
imposing sentence in default". The same is reaffirmed in latest
decision in 2010 AIR SCW 3398 between K.A.Abbas H.S.A.
Vs Sabu Joseph. Therefore, it is deemed fit to provide default
sentence in order to enforce the payment of compensation.
Ex.P.1 cheque is of the Year -2019. Therefore, the complainant
is deprived of the money that was rightfully due to him for
about Three Years. Accordingly, it is deemed fit that a
compensation of Rs.2,20,000/- (Rupees Two Lakh Twenty
Thousand only) be granted. Accordingly, in the light of the
above discussions, I proceed to pass the following:-
ORDER
By acting under section 255(2) of Cr.P.C., the
accused is convicted for the offence punishable under
section 138 of the Negotiable Instruments Act and he is
sentenced to pay fine of Rs.2,25,000/- (Rupees Two Lakh
Twenty Five Thousand only), in default to undergo Simple
Imprisonment for a period of Six Months.
If the fine amount is recovered a sum of Rs.2,20,000/-
(Rupees Two Lakh Twenty Thousand only) is ordered to be paid
to the complainant by way of compensation as per the
provisions under section 357 of Cr.P.C. and the remaining
amount of Rs.5,000/- is to be appropriated to the State.
24
The Bail Bond and the Surety Bond of the accused shall
stand cancelled.
Supply a free copy of this Judgment to the accused.”
The petitioner thus gets convicted of the offence punishable under
Section 138 of the Act. The conviction is challenged in Criminal
Appeal No.329 of 2023 before the Court of Sessions. The Court of
Sessions goes deeper into the details on all the contentions that are
advanced by the petitioner and rejects the appeal by the following
order:
“…. …. ….
16. Now let me examine the oral as well as documentary
evidence. The complainant himself examined as PW1 and got
marked Ex.P.1 to P.18. The accused has not stepped in to the
witness box. However, he got marked three documents as
Ex.D1 to D.3 during the course of cross-examination of PW1. It
is the case of the complainant that the accused had borrowed
Rs. 1,66,70,000/-on different dates and issued three cheques
for Rs.80 lakhs, Rs.85 lakhs and Rs.1.70 lakhs and after
presentation of those cheques to the bank, they were returned
unpaid for ‘insufficient funds’ and he had filed three criminal
cases before the II Addl. Civil Judge and JMFC, Chikkamagaluru
and when the cases were pending, election was declared for
Karnataka State Assembly in the year 2018 and immediately,
the accused thought of settling the disputes and deposited
Rs.1,40,00,000/- and after the deposit of Rs.1,40,00,000/-, the
complainant had withdrawn the complaints and immediately,
the accused again requested the complainant to Rs.68,00,000/-
as loan and he agreed to pay interest @2% pm. on
Rs.68,00,000/- and balance amount of Rs.26,70,000/- of he
earlier transaction. So, believing the words of the accused, the
25
complainant had credited Rs.68,00,000/- on different dates
from 08.03.2018 to 16.03.2018 by way of cheques and for
repayment of the said loan amount of Rs.68,00,000/- and
earlier balance of Rs.26,70,000/- with interest at the rate of 2%
p.m., the accused issued 8 cheques drawn on Kaveri Grameena
Bank, Hassan Main Branch and when the said cheques were
presented to the bank, the same were returned unpaid for
‘insufficient funds’.
17. Ex.P.1 is the cheque bearing No.439921 for
Rs.2,00,000/- dated 08.11.2019 drawn on Kaveri Grameena
Bank. ExP.2 is the bank memo for dishonour of cheque issued
by Oriental Bank of Commerce, Ex.P.3 is the copy of the legal
notice, Ex.P.4 and 5 are the postal acknowledgments, Ex.P.6 is
the reply notice issued by the accused. Ex.P.7 to 9 are the copy
of order sheet, complaint and cheque of PCR No.861/2017,
Ex.P.10 to 12 are the order sheet, complaint and cheque of PCR
No.860/2017. EP.13 to 15 are the copy of the order sheet,
complaint and cheque of PCR No.863/2017, Ex.P.16 is the reply
dated 12.10.2017 issued by the accused, Ex.P.17 and 18 are
the statement of the bank account of the complainant. Ex.D.1 is
the copy of the memo filed in CC No.1582/2017, Ex.D.2 is the
copy of BPL Card, Ex.D.3 is the copy of the order sheet,
complaint and sworn statement recorded in PCR No.17/2016.
18. The accused has contended that the complainant had
no financial capacity to pay the loan of Rs.1,66,70,000/-. He has
further contended that the complainant had no financial capacity
to pay loan of Rs.68,00,000/-. Now it is for this court to
appreciate the evidence on record. One of the important
document which gives clinching evidence to the case on hand is
Ex.P.16. This is the letter or reply given by the accused to the
complainant when the complainant issued statutory notice after
the dishonour of earlier three cheques issued for Rs.80 lakhs, 85
lakhs and 1.70 lakh for repayment of the loan of
Rs.1,66,70,000/- and came to be dishonoured when presented
to the Bank. In Ex.P.16, the accused has stated that he has
received three notices from complainant issued through his
counsel Sri Gerald Dias for the dishonour of cheques. He has
also mentioned the cheque numbers and the amount of the
cheques and stated that he cannot make payment of the
cheques immediately and he sought for 15 days time to pay the
amount and requested the complainant not to present complaint
26
before the court. So, this document clearly establishes that the
accused had admitted the issuance of three cheques for the
discharge of earlier loan of Rs.1,66,70,000/-. The accused has
not disputed Ex.P.16 and there is no cross-examination on this
reply notice and therefore, Ex.P.16 is an admitted document and
this court can safely come to the conclusion that the accused
had borrowed loan of Rs.1,66,70,000/- from the complainant
and issued three cheques bearing No.704954, 704955 of Vijaya
Bank, Chikkamagaluru Branch and cheque No.429517 of
Karnataka State Co-Operative Apex Bank, L.H. Extension
Branch, Bengaluru for Rs.85,00,000/-, Rs.80,00,000/- and
Rs.1,70,000/- respectively. Ex.P.17 is the copy of the bank
statement of the complainant H.R.Huvappa Gowda maintained
with Punjab National Bank, Chikkamagaluru Branch. This
document was also not disputed by the accused. The entry
dated 6.3.2018 clearly shows that the present accused
M.P.Kumaraswamy had remitted Rs.1,40,00,000/-to the bank
account of the complainant. So, the contention that his friends,
well-wishers, party workers, sympathisers, relatives helped him
to pay Rs.1,40,00,000/- is falsified. It is the case of the
complainant that after receipt of Rs.1,40,00,000/-, he had
withdrawn earlier three complaints. Ex.D.1 is the memo filed by
the complainant, wherein it is stated that the complainant and
accused have settled the case outside the court and prayed for
dismissal of the case as settled out of Court. It is pertinent to
note that there is no terms of settlement mentioned in the
memo and what was the amount settled is not stated in the
memo. It is the case of the complainant that Rs.26,70,000/-
had remained balance in the earlier transaction. Though the
accused denied this aspect contending that the complainant had
voluntarily withdrawn the complaints after settlement of the
entire amount, but since, he has deposited only
Rs.1,40,00,000/- to the bank account of the complainant
towards settlement of the earlier cases and since there is no
terms and conditions mentioned in the memo and since the
accused has not produced any document to show the payment
of Rs.26,70,000/-, this Court can safely come to the conclusion
that the accused had kept balance of Rs.26,70,000/- in the
earlier transactions.
19. The next document is Ex.P.18. This document is also
not disputed by the accused. As per Ex.P.18 bank statement,
the complainant had issued 7 cheques to the accused for
27
Rs.68,00,000/- and those 7 cheques were encashed by the
accused. The contention of the accused is that he had not
requested the complainant to give loan of Rs.68,00,000/-. But
the accused has not returned the said amount to the
complainant. There is no evidence on record to show as to who
has presented those 7 cheques to the bank. It means the
accused himself has presented the cheques and encashed.
Therefore, from Ex.P.18 is very clear that the accused had
borrowed Rs.68,00,000/- immediately after settlement of earlier
cheque transactions. He has deposited Rs.1,40,00,000/- on
06.03.2018 and received Rs.20,00,000/- on 08.03.2018,
Rs.15,00,000/- on 08.03.2018; Rs.8,00,000/- on 09.03.2018;
Rs.6,00,000/- on 09.03.2018; Rs.8,00,000/- on 12.03.2018;
Rs.8,00,000/- on 14.03.2018 and Rs.3,00,000/- on 16.03.2018.
Now the accused cannot contend that the complainant had no
financial capacity to lend the loan, because the accused himself
had paid Rs.1,40,00,000/- to the complainant on 06.03.2018.
20. During the course of cross-examination, PW1 has
stated that he is an agriculturist and he is doing vegetable
business and he has owned property and estate and his family
has 15 acres of land and getting income of Rs.15 lakh per year
from ginger crop. PW1 has deposed that the accused himself
had requested him not to mention the amount in the memo filed
in the earlier cases to save his image and to contest in the
elections. Therefore, all this oral evidence as well as
documentary evidence clearly establishes that the accused had
borrowed loan of Rs.68,00,000/- from the complainant and he
has not paid the entire amount of the earlier cheque
transactions and kept balance of Rs.26,70,000/- and he has
agreed to pay interest at the rate of 2% p.m. and for the
repayment of the said loan amount, he has issued 8 cheques
and those cheques were dishonoured when presented to the
bank. No suggestion was put to PW1 that he has stolen his
cheques. No suggestion was put to PW1 that his friends, well-
wishers, party workers, relatives helped him for settling the
earlier three cases. No suggestion was put to PW1 that the
accused has not borrowed any money from the complainant. No
suggestion was put to PW1 that he has not received
Rs.68,00,000/- by way of cheques from the complainant and no
suggestion was put to PW1 that he was not due to pay any
amount to the complainant and no suggestion was put to PW1
that he has not agreed to pay interest at the rate of 2% p.m.
28
21. I have analyzed the principles laid down in the
citations submitted by the learned counsel for accused and
carefully gone through the observations and findings of the said
decisions and applied the principles which suit to the facts and
circumstances of the case in hand.
22. During the course of arguments, the learned
counsel for the accused raised a question as to the
financial capacity of the complainant to lend loan to the
tune of Rs.1,66,70,000/- since he is a BPL Card holder. As
far as lending of loan of Rs.1,66,70,000/- is not the
question before this court in this case. The said matter
had already been settled. Now the question before this
Court is with regard to the financial capacity of the
complainant to lend loan amount of Rs.68 lakhs. It has
already come in the evidence that the complainant has
lent loan of Rs.68 lakhs out of Rs.1,40,00,000/-remitted
by the accused for settling the earlier three criminal
cases. As far as BPL Card is concerned, this court cannot
take any action against the complainant. It is for the
accused to take action before the appropriate authority
for cancellation of BPL Card, if really the complainant and
his family members are not really eligible to hold the BPL
Card.
23. The learned counsel for accused has even
pressed in to service the contention regarding non-
disclosure of the loan transaction to the Income Tax
Department. The accused can intimate the Income Tax
Department or make complaint with regard to non-
disclosure of lending of loan amount and regarding
income of the complainant to give hand loan. This court
cannot decide this aspect. Merely because he has not
disclosed the loan transaction to the Income Tax
Department, this Court cannot hold that he has no
financial capacity to lend loan amount to the accused.
24. As could be noted from the evidence and the
materials that has been placed before this court that the
defence raised by the accused is not at all probable. The
defence that he has not demanded money of
Rs.68,00,000/- also gets falsified completely. All these
29
circumstance cumulatively lead this Court to come to the
conclusion that the complainant has succeeded in proving
the legally enforceable debt and no probable defence
made to rebut the statutory presumption as raised by the
accused. Something which is probable has to be brought
on record for getting burden of proof shifted to the
complainant. The defence raised by the accused does not
inspire the confidence of the Court or meet the standard
of preponderance of probability. Therefore, the
complainant has successfully proved the financial
transaction between him and the accused and the
accused had issued alleged cheques for the repayment of
the loan amount borrowed by him from the complainant
and said cheques came to be dishonoured when
presented to the bank and the accused has failed to rebut
the presumption available under Section 139 of the
N.I.Act. Therefore, the judgment of conviction passed by
the trial court is in accordance with law based on sound
reasonings and the trial court has not committed any
error or illegality in convicting the accused and imposing
fine in the facts and circumstances of the case. Therefore,
there is no need to interfere with the findings recorded
by the trial Court to convict the accused for the offence
punishable under Sec.138 of the Negotiable Instruments
Act. Accordingly, Point No.1 is answered in the Negative.
25. Point No.2: In view of my findings on points No.1, I
proceed to pass the following:
ORDER
The Criminal Appeal filed by the appellant/accused under
Sec.374(3) of Cr.P.C., is hereby dismissed.
The Judgment passed by the XLII ACMM, Bengaluru
in CC No.33472/2021 dated 13.02.2023 convicting the
appellant accused for the offence punishable under
Sec.138 of N.I.Act and sentencing him to pay a fine of
Rs.2,25,000/- is hereby confirmed.
The trial court is directed to pay the compensation to the
complainant out of the fine amount deposited by the accused, if
30any, as per the orders passed by this court after remitting the
fine amount to the Government after the appeal period is over.
Send the copy of the judgment to learned Magistrate
along with TCR forthwith.”
(Emphasis added in each instance)
The petitioner has reiterated those grounds that were urged before
the Court of Sessions or even before the leaned Magistrate all over
again before this Court. Both the learned Magistrate and the
learned Sessions Judge have gone in great detail and recorded their
findings by examining each of the documents that were produced
juxtaposing them with each of the cheques issued.
9. The sheet anchor of the submissions of the
accused/petitioner is that the complainant did not have financial
capacity to lend the amount of close to ₹1.7 crores. Therefore, this
Court must examine the financial capacity of the complainant which
will undoubtedly lead to obliteration of both the orders. The said
submission is unacceptable, in the light of the fact that both the
Courts have considered this aspect and have rendered orders in
great detail. It is settled law that burden of proving financial
capacity of the complainant to lend the amount to the accused is
31always on the accused to establish in a proceeding under Section
138 of the Act. Section 118 of the Act reads as follows:
“118. Presumptions as to negotiable instruments.–
Until the contrary is proved, the following presumptions shall be
made:–
(a) of consideration:–that every negotiable instrument
was made or drawn for consideration, and that
every such instrument, when it has been accepted,
indorsed, negotiated or transferred, was accepted,
indorsed, negotiated or transferred for
consideration;
(b) as to date:–that every negotiable instrument bearing a
date was made or drawn on such date;
(c) as to time of acceptance:–that every accepted bill of
exchange was accepted within a reasonable time after its
date and before its maturity;
(d) as to time of transfer:–that every transfer of a
negotiable instrument was made before its maturity;
(e) as to order of indorsement:–that the indorsements
appearing upon a negotiable instrument were made in the
order in which they appear thereon;
(f) as to stamp:– that a lost promissory note, bill of
exchange or cheque was duly stamped;
(g) that holder is a holder in due course:–that the holder
of a negotiable instrument is a holder in due course:
provided that, where the instrument has been obtained
from its lawful owner, or from any person in lawful custody
thereof, by means of an offence or fraud, or has been obtained
from the maker or acceptor thereof by means of an offence or
fraud, or for unlawful consideration, the burden of proving that
the holder is a holder in due course lies upon him.”
32
Section 118 deals with presumptions as to negotiable instruments.
Unless the contrary is proved, the presumption of transaction
between the two emerges, once the instrument is issued bearing
the signature of the accused. Sections 138 and 139 of the Act read
as follows:
“138. Dishonour of cheque for insufficiency, etc., of
funds in the account.–Where any cheque drawn by a person
on an account maintained by him with a banker for payment of
any amount of money to another person from out of that
account for the discharge, in whole or in part, of any debt or
other liability, is returned by the bank unpaid, either because of
the amount of money standing to the credit of that account is
insufficient to honour the cheque or that it exceeds the amount
arranged to be paid from that account by an agreement made
with that bank, such person shall be deemed to have committed
an offence and shall, without prejudice to any other provision of
this Act, be punished with imprisonment for a term which may
be extended to two years’, or with fine which may extend to
twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply
unless–
(a) the cheque has been presented to the bank within a
period of six months from the date on which it is drawn or
within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as
the case may be, makes a demand for the payment of the
said amount of money by giving a notice; in writing, to
the drawer of the cheque, 5 [within thirty days] of the
receipt of information by him from the bank regarding the
return of the cheque as unpaid; and
33
(c) the drawer of such cheque fails to make the payment of
the said amount of money to the payee or, as the case
may be, to the holder in due course of the cheque, within
fifteen days of the receipt of the said notice.
Explanation.–For the purposes of this section, “debt of
other liability” means a legally enforceable debt or other liability.
139. Presumption in favour of holder.–It shall be
presumed, unless the contrary is proved, that the holder
of a cheque received the cheque of the nature referred to
in section138 for the discharge, in whole or in part, of
any debt or other liability.”
Section 138 deals with dishonor of a cheque that is issued by the
accused in favour of the complainant. So, the complainant becomes
the holder of the cheque. Section 139 deals with presumption in
favour of a holder. Section 139 presumes, unless contrary is
proved, that the holder of a cheque has received the cheque of a
nature referred to in Section 138 towards any debt or any liability.
Therefore, the presumption though rebuttable, has to be rebutted
by the accused in the trial. The orders of both the learned
Magistrate and the Appellate Court are quoted hereinabove. The
presumption, though the accused strenuously made efforts to
rebut, has failed in his rebuttal. Therefore, it is a clear case where
the evidence is goaded against the accused vindicating presumption
against him.
34
10. It becomes apposite, in this regard, to refer to the
judgment of the Apex Court in BASALINGAPPA v.
MUDIBASAPPA1 wherein it is held as follows:
“…. …. ….
26. Applying the preposition of law as noted above, in
facts of the present case, it is clear that signature on the cheque
having been admitted, a presumption shall be raised under
Section 139 that the cheque was issued in discharge of debt or
liability. The question to be looked into is as to whether any
probable defence was raised by the accused. In cross-
examination of PW 1, when the specific question was put that
cheque was issued in relation to loan of Rs 25,000 taken by the
accused, PW 1 said that he does not remember. PW 1 in his
evidence admitted that he retired in 1997 on which date he
received monetary benefit of Rs 8 lakhs, which was encashed by
the complainant. It was also brought in the evidence that in the
year 2010, the complainant entered into a sale agreement for
which he paid an amount of Rs 4,50,000 to Balana Gouda
towards sale consideration. Payment of Rs 4,50,000 being
admitted in the year 2010 and further payment of loan of Rs
50,000 with regard to which Complaint No. 119 of 2012 was
filed by the complainant, copy of which complaint was also filed
as Ext. D-2, there was burden on the complainant to prove his
financial capacity. In the year 2010-2011, as per own case of
the complainant, he made payment of Rs 18 lakhs. During his
cross-examination, when financial capacity to pay Rs 6 lakhs to
the accused was questioned, there was no satisfactory reply
given by the complainant. The evidence on record, thus, is a
probable defence on behalf of the accused, which shifted the
burden on the complainant to prove his financial capacity and
other facts.
27. There was another evidence on the record i.e.
copy of plaint in OS No. 148 of 2011 filed by the
1
(2019) 5 SCC 418
35
complainant for recovery of loan of Rs 7 lakhs given to
one Balana Gouda in December 2009. Thus, there was
evidence on record to indicate that in December 2009, he
gave Rs 7 lakhs in sale agreement, in 2010, he made
payment of Rs 4,50,000 towards sale consideration and
further he gave a loan of Rs 50,000 for which complaint
was filed in 2012 and further loan of Rs 6 lakhs in
November 2011. Thus, during the period from 2009 to
November 2011, amount of Rs 18 lakhs was given by the
complainant to different persons including the accused,
which put a heavy burden to prove the financial capacity
when it was questioned on behalf of the accused, the
accused being a retired employee of State Transport
Corporation, who retired in 1997 and total retirement
benefits, which were encashed were Rs 8 lakhs only. The
High Court observed that though the complainant is
retired employee, the accused did not even suggest that
pension is the only means of survival of the complainant.
Following observations were made in para 17 of the
judgment [Mudibasappa v. Basalingappa, 2018 SCC
OnLine Kar 3625] of the High Court: (Mudibasappa
case[Mudibasappa v. Basalingappa, 2018 SCC OnLine Kar
3625], SCC OnLine Kar)
“17. Though the complainant is retired
employee, the accused did not even suggest that
pension is the only means for survival of the
complainant. Under these circumstances, the trial
court’s finding that the complainant failed to
discharge his initial burden of proof of lending
capacity is perverse.”
28. There is one more aspect of the matter which also
needs to be noticed. In the complaint filed by the complainant
as well as in examination-in-chief the complainant has not
mentioned as to on which date, the loan of Rs 6 lakhs was given
to the accused. It was during cross-examination, he gave the
date as November 2011. Under Section 118(b), a presumption
shall be made as to date that every negotiable instrument was
made or drawn on such date. Admittedly, the cheque is dated
27-2-2012, there is not even a suggestion by the complainant
that a post-dated cheque was given to him in November 2011
bearing the date 27-2-2012. Giving of a cheque on 27-2-2012,
36
which was deposited on 1-3-2012 is not compatible with the
case of the complainant when we read the complaint submitted
by the complainant especially para 1 of the complaint, which is
extracted as below:
“1. The accused is a very good friend of the
complainant. The accused requested the complainant a
hand loan to meet out urgent and family necessary a
sum of Rs 6,00,000 (Rupees Six lakhs) and on account
of long standing friendship and knowing the difficulties,
which is being faced by the accused the complainant
agreed to lent hand loan to meet out the financial
difficulties of the accused and accordingly the
complainant lent hand loan Rs 6,00,000 (Rupees Six
lakhs) dated 27-2-2012 in favour of the complainant
stating that on its presentation it will be honoured. But
to the surprise of the complainant on presentation of the
same for collection through his bank the cheque was
returned by the bank with an endorsement “Funds
Insufficient” on 1-3-2012.”
29. Thus, there is a contradiction in what was initially
stated by the complainant in the complaint and in his
examination-in-chief regarding date on which loan was given on
one side and what was said in cross-examination in other side,
which has not been satisfactorily explained. The High Court was
unduly influenced by the fact that the accused did not reply to
the notice denying the execution of cheque or legal liability.
Even before the trial court, appellant-accused has not denied his
signature on the cheque.
30. We are of the view that when evidence was led
before the court to indicate that apart from loan of Rs 6
lakhs given to the accused, within 2 years, amount of Rs
18 lakhs have been given out by the complainant and his
financial capacity being questioned, it was incumbent on
the complainant to have explained his financial capacity.
Court cannot insist on a person to lead negative evidence.
The observation of the High Court that trial court’s
finding that the complainant failed to prove his financial
capacity of lending money is perverse, cannot be
supported. We fail to see that how the trial court’s
findings can be termed as perverse by the High Court
37
when it was based on consideration of the evidence,
which was led on behalf of the defence.
31. This Court had occasion to consider the expression
“perverse” in Gamini Bala Koteswara Rao v. State of
A.P. [Gamini Bala Koteswara Rao v. State of A.P., (2009) 10
SCC 636 : (2010) 1 SCC (Cri) 372] , this Court held that
although High Court can reappraise the evidence and
conclusions drawn by the trial court but judgment of acquittal
can be interfered with only (sic when the) judgment is against
the weight of evidence. In para 14 following has been held:
(SCC p. 639)
“14. We have considered the arguments
advanced and heard the matter at great length. It is
true, as contended by Mr Rao, that interference in an
appeal against an acquittal recorded by the trial court
should be rare and in exceptional circumstances. It is,
however, well settled by now that it is open to the High
Court to reappraise the evidence and conclusions drawn
by the trial court but only in a case when the judgment
of the trial court is stated to be perverse. The word
“perverse” in terms as understood in law has been
defined to mean “against the weight of evidence”. We
have to see accordingly as to whether the judgment of
the trial court which has been found perverse by the
High Court was in fact so.”
32. The High Court without discarding the evidence,
which was led by defence could not have held that the
finding of trial court regarding financial capacity of the
complainant is perverse. We are, thus, satisfied that the
accused has raised a probable defence and the findings of
the trial court that the complainant failed to prove his
financial capacity are based on evidence led by the
defence. The observations of the High Court that findings
of the trial court are perverse are unsustainable. We,
thus, are of the view that judgment of the High Court is
unsustainable.”
The Apex Court holds that when evidence led before the Court to
indicate the loan given to the accused by the complainant, it was
38
incumbent upon the complainant to have explained his financial
capacity. This is explained in the case at hand. The only contention
raised is with regard to a BPL card which has been suitably
explained by the complainant.
11. The Apex Court, later, in TEDHI SINGH v. NARAYAN
DASS MAHANT2, has held as follows:
“…. …. ….
10. The trial court and the first appellate court have
noted that in the case under Section 138 of the NI Act the
complainant need not show in the first instance that he
had the capacity. The proceedings under Section 138 of
the NI 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
2
(2022) 6 SCC 735
39
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.”
The Apex Court holds that in a case under Section 138 of the Act,
the complainant need not, in the first instance, demonstrate that he
had financial capacity to lend. Only at the time of evidence
rebutting a reply set up by the accused, if adequate evidence is
produced to demonstrate that would suffice.
12. Later, the Apex Court in DATTATRAYA v.
SHARANAPPA3 has held as follows:
“…. …. ….
8. Aggrieved by the decision of the trial court, the
appellant moved the High Court of Karnataka
in Dattatraya v. Sharanappa [Dattatraya v. Sharanappa, 2023
SCC OnLine Kar 235] , which went on to observe that,
admittedly, there was a contradiction in the statement of the
appellant as to when the cheque was issued in his favour.
Furthermore, as was laid down in the decision of this Court
in Rangappa v. Sri Mohan [Rangappa v. Sri Mohan, (2010) 11
SCC 441: (2010) 4 SCC (Civ) 477 : (2011) 1 SCC (Cri) 184] ,
the presumption under Section 139 of the NI Act, 1881 is a
rebuttable one. The contention of the respondent as to the
financial capacity of the appellant to grant a loan in his
favour was to be discharged by him, and being unable to
do so, it shall be presumed that a loan transaction had
not taken place. Accordingly, the findings of the trial court
were affirmed in the impugned judgment dated 3-3-2023
[Dattatraya v. Sharanappa, 2023 SCC OnLine Kar 235].
3 (2024) 8 SCC 573 40 .... .... ....
29. Applying the aforementioned legal position to the
present factual matrix, it is apparent that there existed a
contradiction in the complaint moved by the appellant as against
his cross-examination relatable to the time of presentation of
the cheque by the respondent as per the statements of the
appellant. This is to the effect that while the appellant claimed
the cheque to have been issued at the time of advancing of the
loan as a security, however, as per his statement during the
cross-examination it was revealed that the same was presented
when an alleged demand for repayment of alleged loan amount
was raised before the respondent, after a period of six months
of advancement. Furthermore, there was no financial capacity or
acknowledgment in his income tax returns by the appellant to
the effect of having advanced a loan to the respondent. Even
further the appellant has not been able to showcase as to when
the said loan was advanced in favour of the respondent nor has
he been able to explain as to how a cheque issued by the
respondent allegedly in favour of Mr Mallikarjun landed in the
hands of the instant holder, that is, the appellant.
…. …. ….
32. Moreover, affirming the findings of the trial
court, the High Court observed
[Dattatraya v. Sharanappa, 2023 SCC OnLine Kar 235]
that while the signature of the respondent on the cheque
drawn by him as well as on the agreement between the
parties herein stands admitted, in case where the
concern of financial capacity of the creditor is raised on
behalf of an accused, the same is to be discharged by the
complainant through leading of cogent evidence.”
It is laid down that where the concern of financial capacity of the
creditor/complainant is raised by the accused, the same is to be
proved by the complainant before the concerned Court. The onus is
41
not on the complainant at the threshold to prove his capacity or
financial wherewithal.
13. The Apex Court later, in ASHOK SINGH v. STATE OF
U.P.4, has held as follows:
“…. …. ….
22. The High Court while allowing the criminal
revision has primarily proceeded on the presumption that
it was obligatory on the part of the complainant to
establish his case on the basis of evidence by giving the
details of the bank account as well as the date and time
of the withdrawal of the said amount which was given to
the accused and also the date and time of the payment
made to the accused, including the date and time of
receiving of the cheque, which has not been done in the
present case. Pausing here, such presumption on the
complainant, by the High Court, appears to be erroneous.
The onus is not on the complainant at the threshold to
prove his capacity/financial wherewithal to make the
payment in discharge of which the cheque is alleged to
have been issued in his favour. Only if an objection is
raised that the complainant was not in a financial position
to pay the amount so claimed by him to have been given
as a loan to the accused, only then the complainant would
have to bring before the Court cogent material to indicate
that he had the financial capacity and had actually
advanced the amount in question by way of loan. In the
case at hand, the appellant had categorically stated in his
deposition and reiterated in the cross-examination that
he had withdrawn the amount from the bank in Faizabad
(Typed Copy of his deposition in the paperbook wrongly
mentions this as ‘Firozabad’). The Court ought not to
have summarily rejected such stand, more so when
respondent no. 2 did not make any serious attempt to
dispel/negate such stand/statement of the appellant.
4
2025 SCC OnLine SC 706
42
Thus, on the one hand, the statement made before the Court,
both in examination-in-chief and cross-examination, by the
appellant with regard to withdrawing the money from the bank
for giving it to the accused has been disbelieved whereas the
argument on behalf of the accused that he had not received any
payment of any loan amount has been accepted. In our decision
in S. S. Production v. Tr. Pavithran Prasanth, 2024 INSC 1059,
we opined:
‘8. From the order impugned, it is clear that
though the contention of the petitioners was that the
said amounts were given for producing a film and were
not by way of return of any loan taken, which may have
been a probable defence for the petitioners in the case,
but rightly, the High Court has taken the view that
evidence had to be adduced on this point which has not
been done by the petitioners. Pausing here, the Court
would only comment that the reasoning of the High
Court as well as the First Appellate Court and Trial Court
on this issue is sound. Just by taking a counter-stand
to raise a probable defence would not shift the
onus on the complainant in such a case for the
plea of defence has to be buttressed by evidence,
either oral or documentary, which in the present
cases, has not been done. Moreover, even if it is
presumed that the complainant had not proved the
source of the money given to the petitioners by
way of loan by producing statement of
accounts and/or Income Tax Returns, the same ipso
facto, would not negate such claim for the reason
that the cheques having being issued and signed
by the petitioners has not been denied, and no
evidence has been led to show that the respondent
lacked capacity to provide the amount(s) in
question. In this regard, we may make profitable
reference to the decision in Tedhi Singh v. Narayan Dass
Mahant, (2022) 6 SCC 735:
’10. The trial court and the first appellate court
have noted that in the case under Section 138 of
the NI Act the complainant need not show in the
first instance that he had the capacity. The
proceedings under Section 138 of the NI 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
43complainant 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 crossexamination 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.’
(emphasis supplied)’(underlining in original; emphasis supplied by us in bold)”
On a coalesce of the judgments rendered by the Apex Court what
would unmistakably emerge is that the complainant has
demonstrated issuance of cheques towards financial transactions
and the financial wherewithal towards the transaction.
14. As observed hereinabove, this Court is exercising its
revisional jurisdiction under Sections 397 and 401 of the Cr.P.C.
The jurisdiction is not akin to an appellate Court. The Apex Court in
44
MALKEET SINGH GILL v. STATE OF CHHATTISGARH5 holds as
follows:
“…. …. ….
10. Before adverting to the merits of the contentions, at
the outset, it is apt to mention that there are concurrent
findings of conviction arrived at by two courts after detailed
appreciation of the material and evidence brought on record.
The High Court in criminal revision against conviction is
not supposed to exercise the jurisdiction alike to the
appellate court and the scope of interference in revision
is extremely narrow. Section 397 of the Criminal
Procedure Code (in short “CrPC“) vests jurisdiction for
the purpose of satisfying itself or himself as to the
correctness, legality or propriety of any finding, sentence
or order, recorded or passed, and as to the regularity of
any proceedings of such inferior court. The object of the
provision is to set right a patent defect or an error of
jurisdiction or law. There has to be well-founded error
which is to be determined on the merits of individual
case. It is also well settled that while considering the
same, the Revisional Court does not dwell at length upon
the facts and evidence of the case to reverse those
findings.”
The Apex Court holds, a revisional Court is not an appellate Court
and it can only rectify the patent defect, errors of jurisdiction or the
law. The Apex Court, later, in STATE OF GUJARAT v. DILIPSINH
KISHORSINH RAO6, has held as follows:
".... .... .... 5 (2022) 8 SCC 204 6 (2023) 17 SCC 688 45
13. The primary consideration at the stage of framing of
charge is the test of existence of a prima facie case, and at this
stage, the probative value of materials on record need not be
gone into. This Court by referring to its earlier decisions in State
of Maharashtra v. Som Nath Thapa [State of
Maharashtra v. Som Nath Thapa, (1996) 4 SCC 659 : 1996 SCC
(Cri) 820] and State of M.P. v. Mohanlal Soni [State of
M.P. v. Mohanlal Soni, (2000) 6 SCC 338 : 2000 SCC (Cri)
1110] has held the nature of evaluation to be made by the court
at the stage of framing of the charge is to test the existence of
prima facie case. It is also held at the stage of framing of
charge, the court has to form a presumptive opinion to the
existence of factual ingredients constituting the offence alleged
and it is not expected to go deep into probative value of the
material on record and to check whether the material on record
would certainly lead to conviction at the conclusion of trial.
14. The power and jurisdiction of the Higher Court
under Section 397CrPC which vests the court with the
power to call for and examine records of an inferior court
is for the purposes of satisfying itself as to the legality
and regularities of any proceeding or order made in a
case. The object of this provision is to set right a patent
defect or an error of jurisdiction or law or the perversity
which has crept in such proceedings.”
The Apex Court holds that the object of Sections 397 and 401 of the
Cr.P.C., is only to set right a patent defect or error of jurisdiction or
law or perversity which has crept in such proceedings. The Apex
Court in SANJABIJ TARI v. KISHORE S.BORCAR7 holds as
follows:
".... .... .... 7 2025 SCC OnLine SC 2069 46
27. It is well settled that in exercise of revisional
jurisdiction, the High Court does not, in the absence of
perversity, upset concurrent factual findings (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.]). This court is of the view
that it is not for the revisional court to re-analyse and re-
interpret the evidence on record. As held by this court
in Southern Sales and Services v. Sauermilch Design and
Handels GmbH [(2008) 14 SCC 457; 2008 SCC OnLine SC
1495.], it is a well-established principle of law that the
revisional court will not interfere, even if a wrong order is
passed by a court having jurisdiction, in the absence of a
jurisdictional error.”
(Emphasis supplied in each instance)
The Apex Court, in unequivocal terms, holds that in exercise of
revisional jurisdiction the High Court cannot set aside concurrent
factual findings. The revisional Court cannot re-analyse or re-
interpret the evidence on record. Its object, as laid down in several
cases, is limited to setting right a patent defect or error of
jurisdiction.
15. In the light of the aforesaid unequivocal facts and orders
of both the Courts on cogent evidence, that this Court cannot sit in
appeal over both the orders in revisional jurisdiction and obliterate
the crime. This power is unavailable, as is held by the Apex Court
47
in the afore-quoted judgments. The law is clearly goaded against
the petitioner. I do not find any error of jurisdiction or perversity in
the orders, to re-appreciate the evidence and come to my own
conclusion, other than the evidence that has already been
appreciated by the two Courts. I decline to exercise my jurisdiction
to set aside the concurrent factual findings leading to conviction of
the accused.
16. Finding no merit in these petitions, the petitions stand
dismissed.
Interim order, if any operating, shall stand dissolved.
SD/-
(M.NAGAPRASANNA)
JUDGE
BKP
CT:SS