Smt. Bhagyarathnamma vs M. Srinivas on 16 July, 2026

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    Bangalore District Court

    Smt. Bhagyarathnamma vs M. Srinivas on 16 July, 2026

    KABC030083272018
    
    
    
    
           IN THE COURT OF THE XXV ADDL. CHIEF JUDICIAL
                   MAGISTRATE, AT BANGALORE CITY
    
                 Dated this the 16th day of July 2026
                         Present : SRI. GOKULA. K
                                           B.A.LL.B.
                       XXV Addl. Chief Judicial Magistrate,
                                Bangalore City.
    
                        C.C.No.3182/2018
    
     Complainant :       Smt.Bhagyarathnamma
                         w/o.G.Krishnappa
                         Aged 60 years
                         R/at.126/6, HAF Post
                         Papanna Block
                         Ganganagar
                         Bengaluru 560 024.
                         (By Sri VM Advocate )
    
                                     V/s
    
     Accused     :        Sri. M. Srinivas S/o Mariyappa
                         Aged 32 years
                         R/at.No.265, 4th main road
                         HGH-4, Gangappa Block
                         Ganganagar
                         Bengaluru 560 032.
                         (By Sri VM - Advocate )
    
    Plea of accused:      Pleaded not guilty
    
    Final Orde            Accused is Acquitted.
    
    Date of judgment 16-07-2026
                                        2
                                                          C.C.No.3182/2018
    
    
                              JUDGMENT
    

    The complainant has filed the complaint under Section 200

    of Criminal Procedure Code against the accused for the offence

    SPONSORED

    punishable under Section 138 Negotiable Instruments Act.

    2. The brief case of the complainant is as under:

    It is pleaded that the accused was the tenant in the house

    of the complainant and well acquainted with the complainant.

    The accused was facing financial problems and he approached

    the complainant in the year 2015 and borrowed loan of

    Rs.8,00,000/- with a promise to repay the same within short

    period. After some time, the complainant requested the accused

    to refund the loan amount. Ultimately, the accused towards

    repayment of the loan has issued a cheque bearing No.017215

    dated 06.12.2017 for a sum of Rs.8,00,000/- drawn on ICICI

    Bank, Indiranagar Branch, Bengaluru. The complainant

    presented said cheque through her banker ie. KSC Apex Bank,

    Ganganagar Branch, Bengaluru 560 032 and said cheque

    returned dishonored for the reason “Insufficient Funds” on

    07.12.2017. The complainant issued legal notice dated

    15.12.2017 and said notice is duly served on the accused on

    26.12.2017, but he has not received the same and it is returned

    with endorsement “not claimed”. It is pleaded that inspite of
    3
    C.C.No.3182/2018

    service of notice, the accused failed to pay due amount to the

    complainant. Therefore, the accused has committed the offence

    under Section 138 of Negotiable Instruments Act. Therefore the

    complainant has filed the complaint.

    3. This case is initially filed before XV the ACJM, Bengaluru

    City.

    4. On the basis of Private complaint filed by the complainant,

    the court has taken cognizance of offence and registered the

    case in PCR No.856/2018 and recorded sworn statement of the

    complainant as PW 1 and got marked 6 documents as Ex.P 1 to

    P6. The court by considering the material on record issued

    process under Section 204 of Cr.PC by registering the criminal

    case. In response to the process issued by this court, the

    accused appeared before this court and is released on bail. The

    copy of the complaint is served to the accused along with the

    summons as contemplated under Section 207 of Criminal

    Procedure Code.

    5. The substance of the acquisition as provided under

    Section 251 of Cr.P.C is read over to the accused and plea is

    recorded. The accused pleaded not guilty and claimed to be

    tried.

    4

    C.C.No.3182/2018

    6. In view of the law laid down by Hon’ble Supreme Court of

    India in Indian Bank Association V/s Union of India and others

    reported in AIR 2014 SCW 3463, the affidavit filed by the

    complainant at the stage of taking cognizance and documents

    marked is treated as evidence under section 145 of Negotiable

    Instruments Act. On the application of the accused PW 1 is

    recalled and fully cross examined. After closer of evidence of

    complainant the court has readover the incriminating

    circumstances in the evidence of PW 1 to the accused and

    recorded his statement as required under Section 313 of Cr.P.C.

    The accused has denied the incriminating circumstances as

    false. The accused himself examined as Dw1 and got marked 3

    documents as Ex.D1 to Ex. D 3. After closer of evidence of both

    parties the court has passed the judgment on 05.07.2019 and

    convicted the accused for the offence under Section 138 of

    Negotiable Instruments Act.

    7. The Hon’ble LXVII Addl City Civil & Session Judge, Bengluru

    in Crl.A.No.1696/2019 has set aside the judgment and

    remanded the case vide order dated 05-11-2024 for giving

    opportunity to both parties and for fresh disposal. The Hon’ble

    Sessions court in the said order has observed that the trial

    court has not considered as to whether the statement discloses

    the withdrawal of money as claimed by the complainant. The
    5
    C.C.No.3182/2018

    trial court has not appreciated the evidence in the light of

    Section 40A(3) and 269-SS of Income Tax Act. It is also observed

    that the trial court has failed to appreciate the admissions

    brought out in the cross examination of PW 1. The Hon’ble

    Sessions court has also directed to give opportunity to both

    parties to examine the witness by name Manjunath, whose

    name is mentioned in the witness list.

    8. After remand of the case, case is restored on the board of

    XVth ACJM, and later the case is transferred to this court vide

    orders of Hon’ble CJM Bengaluru City bearing no. ADM I

    22/2025 dated 02-12-2025.

    9. The presence of both the parties secured before this court.

    The opportunity is given to both parties to lead their evidence

    and also to examine Mr. Manjunath as per the orders of Hon’ble

    Sessions Court. After remand of the matter the PW 1 is further

    examined and he has produced two more documents as Ex.P 7

    and Ex.P.8 and he is fully cross examined. On the application

    of the complainant, DW1 has been recalled and further cross

    examination of DW 1 recorded. The accused has filed

    application to summon Manjunath as witness. Inspite of

    issuance of repeated summons his whereabouts are not traced

    and his presence is not secured. The complainant has not made

    any attempt to examine Manjunath.

    6

    C.C.No.3182/2018

    10. Heard arguments of learned counsel for the complainant

    and arguments of learned counsel for the accused and perused

    the material on record.

    11. On the basis of the material on record the following points

    arise for the consideration of this court :

    1. Whether the complainant proves beyond all
    reasonable doubt that the accused has issued a
    cheque bearing No.017215 dated 06.12.2017
    for a sum of Rs.8,00,000/- drawn on ICICI
    Bank, Indiranagar Branch, Bengaluru towards
    discharge of legally recoverable debt and on
    presentation of the same through the
    complainant banker i.e. KSC Apex Bank,
    Bengaluru, the said cheque returned
    dishonored for the reason “Funds Insufficient”

    on 07.12.2017 and inspite of issuance of
    demand notice dated 15.12.2027, the accused
    has not complied the demands in the notice
    and thus the accused has committed an
    offence punishable under Section 138 of
    Negotiable Instruments Act ?

    2. What Order of Sentence?

    12. The findings of this court to the above points are as follows:

               Point No.1      In the Negative,
               Point No.2      As per final order,
                                             for the following :
                                   7
                                                C.C.No.3182/2018
    
                                REASONS
    
    13. POINT NO.1:    To prove the case, the complainant herself
    
    

    examined as PW1 and in her evidence affidavit, she has

    reiterated the averments made in the complaint. The PW1 has

    deposed that the accused was the tenant in her residential

    premises. She has deposed that the accused was facing

    financial problems and the accused approached her for financial

    assistance in the year 2015 and borrowed loan of Rs.8,00,000/-

    with a promise to repay the same within short period. The PW

    1 further deposed that, after some time when she requested the

    accused to refund the loan amount, the accused has issued a

    cheque bearing No.017215 dated 06.12.2017 for a sum of

    Rs.8,00,000/- drawn on ICICI Bank, Indiranagar Branch,

    Bengaluru. The PW 1 has produced said cheque as Ex.P.1. The

    PW 1 has further deposed that when said cheque was presented

    through her banker i.e. KSC Apex Bank, Ganganagar Branch,

    Bengaluru 560 032 for collection, said cheque returned

    dishonored for the reason “Insufficient Funds” on 07.12.2017.

    The PW 1 has produced the return memo as Exhibit P2. The

    PW1 has deposed that she has issued the demand notice to the

    accused on 15.12.2017. Said notice is marked as Ex.P.3. The

    PW 1 has further deposed that said notice returned unserved for

    the reason “not claimed” on 26.12.2017. She has deposed that

    the accused intentionally refused to receive the notice. Hence,
    8
    C.C.No.3182/2018

    the notice is deemed to be served on the accused on

    26.12.2017. The complainant has produced postal receipt as

    Exhibit P4 and the postal envelope as Ex.P.5. She has deposed

    that in spite of service of the notice the accused has not

    complied the demands in the notice and committed the default.

    14. Now it is proper to consider whether the complainant has

    complied all the statutory requirements for commission of

    offence under Section 138 of Negotiable Instruments Act. The

    essential ingredients of section 138 and 142 of Negotiable

    Instruments Act to be complied are i) drawing of the cheque by

    the accused ii) presentation of the cheque to the bank with in

    the period of three months, iii) returning of the cheque unpaid

    by the drawee bank iv) giving notice in writing to the drawer of

    the cheque demanding of the payment of cheque amount with

    in the period of 30 days, v) failure of the drawer to make

    payment within the period of 15 days after receipt of the

    demand notice and v) Presentation of the complaint within a

    month by the complainant after expiry of 15 days of service of

    notice to the accused. Therefore it is proper to consider

    whether the statutory requirements for constituting the offence

    under Section 138 of Negotiable Instruments Act is complied by

    the complainant.

    9

    C.C.No.3182/2018

    15. The cheque is dated 06.12.2017. The cheque is presented

    for collection and it is dishonored on 07.12.2017 for the reason

    ” Funds insufficient”. The demand notice is issued on

    15.12.2017, it is returned as refused on 26.12.2017. The cause

    of action for prosecution arose on expiry of 15 days after service

    of demand notice on 11.01.2018. The complaint is filed before

    this court on 22.01.2018. The cheque is presented for collection

    through KSC Apex Bank, Ganganagar branch, Bengaluru,

    situated within the jurisdiction of this court. Thus the

    complainant has complied all the statutory requirements of

    Section 138 and 142 of Negotiable Instruments Act. The

    accused, who examined as DW1 in the cross-examination, has

    admitted that the cheque is drawn from his account. He has

    also admitted his signature on the cheque. The accused has

    also admitted that notice is served to his address by the postal

    authority. He has deposed that at the time of arrival of the

    notice, he was not in the station and he went to Anekal and

    thereafter he has not contacted the postal authority about the

    said notice. He has also admitted that he was residing in House

    No. 265, Gangappa block, Ganganagara-Bangalore. Therefore, it

    is clear that the notice is issued to the correct address of the

    accused and the said notice is returned unclaimed by the

    accused. The accused has not taken any steps to examine the

    postal authority to dispute correctness of the postal
    10
    C.C.No.3182/2018

    endorsement, which is made in discharge of official duty by the

    postal authority.

    16. The provisions of Section 118 provides for presumption as to

    negotiable Instruments which 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, 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) ………………
    The provisions of Section 139 of Negotiable Instrument Act

    reads as under:-

    139- Presumption in favour of holder – It should 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.
    [

    17. Hon’ble Supreme court in a decision reported in (2010) 11

    SCC 411 between Rangappa V/s Sri Mohan has held that –
    11

    C.C.No.3182/2018

    The presumption mandated by Section 139
    of the act does indeed include the existence
    of a legally enforceable debt or liability.

    18. In the decision of Hon’ble Supreme Court in Rajesh Jain v.

    Ajay Singh, (2023) 10 SCC 148, it is held that

    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.

    42. The nature of evidence required to shift the
    evidential burden need not necessarily be direct
    evidence i.e. oral or documentary evidence or
    admissions made by the opposite party; it may
    comprise circumstantial evidence or presumption
    of law or fact.

    19. Learned counsel for the complaint has also relied on the

    decision of Hon’ble Supreme Court reported in AIR 2018 SC

    3601 between T . P. Murugan v. Bhojan. In this decision also, it

    is held that the presumption under Section 139 of Negotiable

    Instruments Act is rebuttable presumption and if the

    presumption is not rebutted, the complaint is not required to

    prove the existence of debt.

    12

    C.C.No.3182/2018

    20. Therefore, in view of the principles laid down in these

    decision, once the complainant has proved execution and

    issuance of cheque, the onus is on the accused to rebut the

    presumption under 139 of Negotiable Instruments Act. As

    discussed above, the complainant has complied the basic

    requirements of law and hence he is entitled for presumption

    under Section 118 and 139 of Negotiable Instrument Act.

    Therefore the onus is on the accused to rebut the presumption.

    Therefore now it is proper to consider the defence of the

    accused.

    21. The defence of the accused is that he was the tenant under
    [

    the complainant. In respect of payment of rent, and amount

    availed by his wife from the complainant, there was due amount

    of Rs.1,00,000/- payable by the wife of the accused to the

    complainant. In respect of said due amount, his wife has been

    paying interest at the rate of 10%. But thereafter she was not

    able to pay the interest. Then the complainant has quarreled

    with his wife near his house and at that time his wife has

    handed over Cheque No.017215 and 017216 to the complainant.

    It is further case of the accused is that thereafter in October

    2017 his wife has repaid a sum of Rs.1,00,000/- with interest of

    Rs.10,000/- totally for Rs.1,10,000/-. At the time of repayment

    of the amount, his wife has asked for return of the cheques
    13
    C.C.No.3182/2018

    obtained by the complainant. Then the complainant has

    represented that said cheques were misplaced and not traceable.

    With regard to the said cheques, the complainant has given one

    document which is marked as Exhibit D2. It is the case of the

    accused that in the case filed by the complainant against his wife

    in CC No. 3183/2018 in the evidence of the complainant, she

    has admitted Exhibit D2 document. The accused has produced

    the said deposition of the complainant as Exhibit D3. Thus the

    defence of the accused is that his wife was due to pay a sum of

    Rs.1,00,000/- to the complainant and the complainant came

    near their house and quarreled with his wife. Then his wife has

    issued two of his cheques to the complainant. It is further case

    of the accused that, thereafter his wife has repaid the loan. But

    the complainant has not returned the cheques and in respect of

    said aspect the complainant has executed Exhibit D2

    acknowledgment.

    22. To substantiate said defence, the accused has produced

    Exhibit D2 acknowledgment of the complainant and Exhibit D3

    the deposition of the complainant in CC No. 3183/2018. The

    contents of Exhibit D2 reads as under –

    ಭಾಗ್ಯರತ್ನಮ್ಮ ಆದ ನಾನು ಹೇಳಿ ಬರೆಯಿಸಿದ ಪತ್ರವಾಗಿರುತ್ತದೆ. ಪಾರ್ವತಿಯವರು 3

    ಖಾಲಿ ಚೆಕ್‌ಗಳು ನನಗೆ ಕೊಟ್ಟಿರುತ್ತಾರೆ. ನನ್ನ ಹಣವನ್ನು ಹಿಂತಿರುಗಿಸಿರುವುದರಿಂದ ಈ 3

    ಖಾಲಿ ಚೆಕ್ಕುಗಳು ಕಳೆದುಹೋಗಿರುವುದರಿಂದ ಚೆಕ್ ನಂಬರ್ 976119 ಮತ್ತು ಚೆಕ್
    14
    C.C.No.3182/2018

    ನಂಬರು 017215 ಮತ್ತು ಚೆಕ್ ನಂಬರು 017216 ಈ ಚೆಕ್ಕುಗಳು ಸಿಕ್ಕ ಮೇಲೆ ನಿಮಗೆ

    ಪಾರ್ವತಿಯವರಿಗೆ ಕೊಡುತ್ತೇನೆ. ಸಹಿ/- ಭಾಗ್ಯರತ್ನಮ್ಮ ಕೆ .

    With regard to Exhibit D2, the complainant as per Ex.D 3

    deposition in CC No. 3183/2018 has deposed as under –

    ಸಾಕ್ಷಿದಾರರು ಆರೋಪಿ ಪರ ವಕೀಲರು ತೋರಿಸುವ ಒಂದು ದಾಖಲೆಯನ್ನು ನೋಡಿ

    ಅದಕ್ಕೆ ಇರುವ ಸಹಿ ತಮ್ಮದು ಎಂದು ಒಪ್ಪಿಕೊಂಡಾಗ ಆದ ದಾಖಲೆಯನ್ನು ನಿ.ಡಿ. 1

    ಎಂದು ಗುರುತಿಸಲಾಯಿತು. ನಿ.ಡಿ. 1 ರಲ್ಲಿ ಬರೆದಿರುವ ವಿಷಯ ಗೊತ್ತು. ನಿ.ಡಿ. 1

    ದಾಖಲೆಯನ್ನು ಸಾಕ್ಷಿದಾರರು ಓದಿದ ನಂತರ ಅದರ ಪ್ರಕಾರ 3 ಚೆಕ್ಕುಗಳನ್ನು ಆರೋಪಿ

    ನೀಡಿರುವುದಿಲ್ಲ ಎಂದು ಹೇಳುತ್ತಾರೆ. ಆದರೆ 2 ಚೆಕ್ಕುಗಳನ್ನು ನೀಡಿರುವುದಾಗಿ ಹೇಳುತ್ತಾರೆ.

    ಅವುಗಳ ನಂಬರ್ 976119 ಮತ್ತು 017215 ಎಂದರೆ ಸರಿ ನಿ.ಡಿ. 1 ರಲ್ಲಿ ಈ ಎರಡೂ

    ಚಕ್ಕುಗಳ ಬಗ್ಗೆ ಉಲ್ಲೇಖಿಸಿರುವುದು ಸರಿ ಇರುತ್ತದೆ. ಆದರೆ ಇನ್ನೊಂದು ಚಕ್ಕಿನ ಬಗ್ಗೆ

    ಉಲ್ಲೇಖಿಸಿರುವುದು ಸರಿ ಅಲ್ಲ . ಈ ಚೆಕ್ಕಿನ ನಂಬರು 017216 ಇದು

    ಸಂಬಂಧಪಟ್ಟಿರುವುದಿಲ್ಲ. ಸಹಿಯನ್ನು ನಿ.ಡಿ. 1 (ಎ) ಎಂದು ಗುರುತಿಸಲಾಯಿತು.

    23. Thus, upon considering this portion of evidence, along with

    averments in Exhibit D 2, the complainant has very clearly

    admitted execution of Exhibit D2 acknowledgment and also

    admitted contents of the same except Cheque No.017216. In this

    case, the Exhibit P1 cheque is bearing number 017215.

    Therefore, it is clear that the cheque referred in Exhibit D2

    acknowledgment is the same cheque produced as Exhibit P1. As

    per Exhibit D3, the complainant has denied the suggestion of the

    accused that she has executed Exhibit D2 acknowledgment at
    15
    C.C.No.3182/2018

    the time of quarrel by saying that three cheques were

    dishonored. With regard to Exhibit D2 document, in the cross-

    examination of DW1, complainant has made the suggestion that

    complainant has not executed Exhibit D2 document and it is

    created by the accused by forging the signature of the

    complainant. But in view of categorical admission of the

    complainant in Exhibit D3, deposition in CC No. 3183/2018,

    this suggestion will not have much evidentiary value.

    [[[

    24. This evidence brought on record by the accused,

    probabilises that the amount availed by the wife of the accused

    is returned by her. But the complainant who had the custody of

    cheques has not returned the said cheques. Exhibit D2

    acknowledgment also reflects the cheque number produced in

    this case as Exhibit P1 is one of the cheque agreed to be

    returned and claimed as misplaced. Therefore, it is clear that

    The Exhibit P1 cheque is obtained by the complainant towards

    the security of the amount due from the wife of the accused and

    in Exhibit D2 the complainant has admitted return of the

    amount and also stated that the cheque was misplaced and she

    has agreed to return the cheque to the wife of the accused. It is

    settled principle of law that the accused need not prove his

    defence with cogent evidence. If the accused is able to bring on

    record a probable evidence, it is sufficient for rebuttal of the
    16
    C.C.No.3182/2018

    presumption under Section 139 of Negotiable Instruments Act.

    Therefore, In view of this evidence placed on record by the

    accused, this Court is of the considered view that the evidence

    placed by the accused is sufficient for rebuttal of the

    presumption under Section 139 of Negotiable Instruments Act.

    25. Another line of defence of the accused is that the

    complainant is not having sufficient amount to lend a sum of

    Rs.8,00,000/- to the accused. As per the case of the

    complainant, she has lent a sum of Rs.8,00,000/- to the accused

    and a sum of Rs.2,00,000/- to the wife of the accused. Thus, she

    has lent totally a sum of Rs.10,00,000/-. The accused has

    disputed about the financial capacity of the complainant to lend

    a sum of Rs.10,00,000/-. This Court while deciding this case at

    the earlier point of time has held that the husband of the

    complainant is the retired employee of BESCOM and the son of

    the complainant is working at London and hence the

    complainant is having stable financial capacity to lend the

    amount. But the Hon’ble Sessions Court, while remanding the

    matter, has not accepted the findings recorded by the court and

    directed this Court to examine the financial capacity of the

    complainant and source of money from which the complainant

    has lent the amount and also directed this Court to examine in

    the light of the requirements of Income Tax Act.
    17

    C.C.No.3182/2018

    26. To prove the financial capacity, the complainant has

    produced the statement of fixed deposits of her husband

    Krishnappa as Exhibit P6. It shows that they are having fixed

    deposits of ₹69,63,000/- and they have received interest for a

    period from 01.04.2014 to 31.05.2025 for Rs.4,69,054/-. It is

    not the case of the complainant that she has withdrawn the fixed

    deposits and lent a sum of Rs.10,00,000/- to the accused and

    his wife. Therefore, Exhibit P6 only shows that during the year

    01.04.2014 to 31.03.2015 the husband of the complainant has

    received interest income of Rs.4,69,054/-. Further, the

    complainant has produced the statement of accounts in respect

    of her account with Karnataka State Cooperative Apex Bank for

    a period from 01.01.2010 to 01.01.2015. On perusal of the same

    the maximum amount in deposit in the said account in the year

    2012 is ₹ 3,82,255/-. As per the pleadings of the complainant

    she has lent the amount in the year 2015. But the statement of

    account shows that the closing balance as on 30.09.2014 is only

    Rs.9,990/-. Therefore this document also does not aid the

    complainant to prove the existing financial capacity to lend the

    amount of Rs.10,00,000/- to the accused and his wife. Exhibit

    P8 is the statement of accounts of the husband of the

    complainant with Karnataka State Cooperative Apex Bank for a

    period from 01.01.2010 to 15.01.2015. This also shows the

    closing balance as on 12.01.2015, its only Rs.2,495/-. Therefore,
    18
    C.C.No.3182/2018

    this statement of accounts also not show the existing financial

    capacity of the complainant to lend a sum of Rs.10,00,000/- to

    the accused and his wife. In the cross-examination, the PW1 has

    deposed that she has paid the loan amount by way of cash and

    she has deposed that her son is working at London and her

    husband is retired from government service. But she has not

    deposed from which source she has accumulated a sum of Rs.

    10,00,000/- to lend to the accused and his wife. She has

    deposed that portion of the amount was with her in the home

    and portion of the amount she has withdrawn from the bank.

    But to substantiate withdrawal of the amount she has not

    produced any material before the court. In the cross-

    examination, PW1 has also deposed that she has withdrawn the

    amount from her ICICI bank account in the year 2015. But to

    substantiate said amount she has not produced any material

    and the bank statement of her account with ICICI bank.

    [

    27. Therefore, from the evidence on record, the complainant has

    not produced the documents to prove the source of income from

    which she has lent a sum of Rs10,00,000/- to the accused and

    her wife. This also gives a probable doubt that the accused and

    his wife have availed a sum of Rs10,00,000/- from the

    complainant. If she really paid a sum of Rs.10,00,000/-, she
    19
    C.C.No.3182/2018

    should have explained the source of income by producing

    evidence on record.

    28. The Hon’ble Sessions Court, while remanding the matter,

    has directed the court to examine the income tax returns of the

    complainant or her husband. But, in spite of granting sufficient

    opportunity, the Complainant has not produced any of income

    tax returns before this court to evaluate the same. Therefore, an

    adverse inference can be drawn against the complainant that

    they have not shown about the amount lent to the accused and

    also an inference can be drawn that declared income shows that

    the complainant is not having sufficient financial capacity to

    lend a sum of Rs.10,00,000/- to the accused and his wife.

    In this regard, Learned counsel for the accused has relied on

    the decision of Hon’ble Supreme Court reported in 2015 1 SCC

    99 between K. Subramani v. K. Damodar Prabu .In this decision,

    Hon’ble Supreme Court has held that even though the

    complainant is having benefit of presumption under Section 139

    of Negotiable Instruments Act, if the complainant could not prove

    source of income from which alleged loan was made to the

    accused, is also one of the grounds for rebuttal of the

    presumption under Section 139 of Negotiable Instruments Act,

    and it can be ascertained from the evidence placed on record.
    20

    C.C.No.3182/2018

    Therefore, in this case, when the accused has seriously disputed

    the source of income of the complainant and the Hon’ble

    Sessions Court has also remanded the matter with a direction to

    lead evidence with regard to source of income, the complainant

    should have produced the source of income from which she has

    lent the amount. As discussed above, the Exhibit P6 to Exhibit

    P8 produced by the complainant does not show that at the

    relevant point of time the complainant had sufficient fund or

    has withdrawn any amount for lending to the accused.

    [[

    29. The complainant in the list of witnesses has shown one

    Manjunath as witness, but the complainant has not examined

    said Manjunath before this court and also not stated the role of

    Manjunath in the transactions. The accused has made attempts

    to examine said Manjunath as per the directions of Hon’ble

    Sessions Court, but his presence is not secured in spite of

    issuance of repeated warrant. The complainant has not assisted

    to secure the presence of said Manjunath in spite of the orders of

    the Hon’ble Sessions Court. Therefore, it can also be inferred

    that the complainant is not intended to examine said Manjunath

    before this Court, as his evidence will adversely affect the case of

    the complainant or he has no role to play in the transactions

    alleged.

    21

    C.C.No.3182/2018

    30. Therefore, upon appreciating the entire evidence on record,

    this Court is of the considered view that the material placed by

    the accused, such as Exhibit D2 and D3, and the defence taken

    by the accused about the Source of income of the complainant

    and their financial capacity to lend a sum of Rs.10,00,000/- to

    the accused and his wife also a probable evidence to doubt the

    statement of the complainant that she has lent a sum of Rs.

    8,00,000/- to the accused and Rs.2,00,000/- to the wife of the

    accused by way of cash.

    31. By producing Exhibit D2, the accused has substantiated his

    defence that his wife has availed some amount from the

    complainant and there were rental dues totally for Rs.1,00,000/-

    and upon repayment of the said amount the complainant has

    represented that the cheques were misplaced and assured to

    return the cheque after securing the same. This acknowledgment

    of the accused also probabilises the defence raised by the

    accused.

    32. On the other hand, in view of the rebuttal or the

    presumption with probable evidence by the accused, the

    complainant should have proved the fact with cogent evidence

    about lending of Rs. 8,00,000/- to accused and issuance of

    cheque by the accused towards discharge of said amount. But
    22
    C.C.No.3182/2018

    the complainant has not produced any material to substantiate

    the claim with cogent evidence. The fact of lending of Rs.

    8,00,000/- and Rs.2,00,000/- to the accused and his wife is not

    proved. The complainant has also not produced any material

    evidence to prove that the Exhibit P1 cheque is issued by the

    accused for discharge of said liability by producing cogent and

    convincing evidence. Therefore, this Court can safely conclude

    that the complainant has failed to prove the guilt of the accused

    beyond all reasonable doubt. Therefore, the complainant failed

    in proving the commission of the offence by the accused under

    Section 138 of Negotiable Instruments Act. Hence, this Court

    answers the above point number 1 in the negative.

    33. POINT NO. 2 : While answering the point no. 1 this court

    concluded that the complainant has failed to prove that the

    accused has committed the offence punishable under Section

    138 of Negotiable Instruments Act. Therefore the accused is

    entitled for acquittal for the offence alleged under Section 138

    of Negotiable Instruments Act.

    34. On perusal of the records, it appears that the Hon’ble

    Sessions Court, in Criminal Appeal 1696/2019, vide Order

    dated 13.11.2019, has awarded interim compensation to

    complainant and directed this Court to release 20% of the fine

    amount deposited by the accused before this Court in favour of
    23
    C.C.No.3182/2018

    the complainant upon executing personal bond with a surety for

    like sum. Accordingly, vide Order No. 26.11.2019, this Court

    has ordered to release a sum of ₹ 1,60,000/- deposited by the

    accused in favour of the complainant upon execution of

    indemnity bond and furnishing surety for like sum.

    As provided under Section 148(3) of NI Act, if the

    appellant is acquitted, the court shall direct the complainant to

    repay to the appellant the amount so released with interest at

    the bank rate as published by Reserve Bank of India, prevalent

    at the beginning of the relevant financial year within 60 days

    from the date of the order or within such further period not

    exceeding 90 days, as may be directed by the court on sufficient

    cause being shown by the complainant. As provided under

    Section 143A(4) there is similar provision is made for recovery of

    the fine amount or interim compensation collected by the

    complainant in the event of acquittal of the accused. In this

    case, the Hon’ble Sessions Court has not passed order of

    acquittal, but it has set aside the order of conviction and

    remanded the matter to this court. As discussed above, in this

    case, the Complainant has failed to prove the guilt of the

    accused and the accused is entitled for acquittal. Therefore, the

    complainant is required to refund the interim compensation

    amount for a sum of ₹ 1,60,000/- with prevailing rate of interest
    24
    C.C.No.3182/2018

    to the accused within 60 days from this date. As per the

    guidelines off Reserve Bank of India the prevailing bank interest

    rate is 5.50% in the beginning of financial year 2026-27.

    Therefore this court proceed to pass the following –

    ORDER

    By exercising powers conferred U/sec.255(1) of Cr.P.C.,

    the accused is acquitted of the offence punishable under

    Section 138 of Negotiable Instrument Act.

    The bail bond and surety bond of the accused shall be in

    force for a period of 6 months for the purposes of Section 437 A

    of Cr.P.C.

    The accused is set at liberty.

    Acting under Section 143A(4) of NI Act, the complainant is

    directed to refund the interim compensation amount received by

    her for a sum of ₹ 1,60,000/- to the accused with interest at the

    rate of 5.50% per annum from 03.01.2020 till payment of entire

    amount with in 60 days from this day. In default, the accused is

    at liberty to proceed in accordance with law to recover the said

    amount from the complainant.

    (Partly dictated to the Stenographer directly on the computer, typed by her,
    partly dictated to Adalath ai, computer application, transcribed by it,
    corrected and signed then pronounced by me in the open court on this the
    16th day of July 2026).

    (GOKULA.K)
    XXV A.C.J.M., BANGALORE CITY.

    25

    C.C.No.3182/2018

    ANNEXURE

    LIST OF WITNESSES EXAMINED FOR THE COMPLAINANT:

    PW.1 : Smt.Bhagyarathnamma

    LIST OF DOCUMENTS MARKED FOR THE COMPLAINANT:

    Ex.P1      :     Cheque
    Ex.P2      :     Bank Endorsement
    Ex.P3      :     Office copy of Legal Notice
    Ex.P4      :     Postal receipt
    Ex.P5      :     Postal Envelope
    Ex.P6      :     Bank Statement
    Ex.P7      :     Bank Account Statement
    Ex.P8      :     Bank Account Statement
    
    
    

    LIST OF WITNESSES EXAMINED FOR THE ACCUSED:

    DW.1       :     M. Srinivas
    
    LIST OF DOCUMENTS MARKED FOR THE ACCUSED:
    
    Ex.D1      :     Rent Agreement.
    Ex.D2      :      C/c of acknowledgment of
                      complainant.
                                                                    Digitally
    Ex.D3      :      C/c of deposition of complainant in           signed by
                                                                    GOKULA K
                      C.C.No.3183/2018.                      GOKULA
                                                                    Date:
                                                             K      2026.07.16
                                                                    16:30:43
                                                                    +0530
    
                                         (GOKULA.K.)
                               XXV A.C.J.M., BANGALORE CITY.
     26
         C.C.No.3182/2018
     



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