Bangalore District Court
Sreekanth Bolla vs Madhusudhan Rao on 27 April, 2026
KABC0A0033362024
IN THE COURT OF LXXIII ADDL.CITY CIVIL &
SESSIONS JUDGE, MAYOHALL UNIT, BENGALURU.
(CCH.74)
PRESENT:
Smt. Anitha N.P., B.A.L., L.L.M.,
LXXIII Addl.City Civil & Sessions Judge,
Mayohall Unit, Bengaluru.
Dated this the 27th day of April 2026
Crl. Appeal. No.25355/2024
Appellants/ Mr. Sreekanth Bolla,
Accused:- S/o: Mr. Sriramalu,
Aged about 39 years,
R/at: Flat No.501,
Raaga Residency,
Kalyan Nagar Phase -3,
Hyderabad - 500018.
(By Sri. N.S. Chithraja Devi - Adv.,)
V/s
Respondents/ Mr. Madhusudhan Rao,
Complainant: S/o: late Narasimhaiah,
Aged about 52 years,
R/at:No.F-1, Creative Royal Apartment,
Srinivas Reddy Road, AECS Layout,
Chinnappanahal, Bangalore 560 037.
By Indira Tadakamalla - Adv.,)
2 Crl.Appeal No.25355/2024
JUDGMENT
This is an Appeal filed by Accused under Section
374(3) of Cr.P.C., being aggrieved by the Judgment dated
10.09.2024 passed in C.C. No.53462/2019 on the file of
XXXIV ACJM, Mayohall Unit, Bengaluru, convicting him
for an offence punishable under Section 138 of the
Negotiable Instruments Act [hereinafter referred to as ‘NI
Act‘, for brevity] and sentencing him to pay fine of
Rs.13,24,000/- and in default of payment of fine, to
undergo simple imprisonment for 6 months. Out of the
fine amount, a sum of Rs.13,19,000/- is directed to be
paid to the respondent/complainant as compensation
and remaining Rs.5,000/- is ordered to be remitted
towards State expenses.
2. For the sake of convenience the parties
hereinafter will be referred to with their ranking assigned
before the trial court. The appellant is the accused and
the respondent is the complainant before the trial court.
3. The facts of the case:-
The wife of accused and wife of complainant were
directors of various companies and out of that
acquaintance the accused availed credit facility of Rs.25
3 Crl.Appeal No.25355/2024lakhs from the complainant during the interval in
between January 2017 to November 2018 and assured to
repay the amount on demand. When the complainant
asked for repayment of the amount the accused paid
Rs.10 lakhs on 06.12.2018 towards the discharge of
partial liability and to discharge further liability the
accused issued cheque bearing No.280400 dated 10-12-
2018 for a sum of Rs.4 lakhs, cheques bearing No.
280401 and 280401 dated 10.12.2018 for a sum of Rs.3
lakhs each. The complainant presented the said 3
cheques before his banker and the said cheques
returned with an endorsement payment stopped by the
drawer on 11.02.2019. Hence, the complainant issued
legal notice on 07.03.2019 to the accused. The said
notice is duly served on accused on 09.03.2019. The
accused has given reply and thereafter the complainant
has issued rejoinder notice dated 09.04.2019. However
the accused not paid the amount of cheques. Thereby,
the Appellant/accused has committed the offence
punishable under Sec.138 of NI Act. Thereafter the
Complainant approached the Trial Court for appropriate
legal action against the Accused.
4. Pursuant to summons the Accused entered
appearance through his Counsel before the Trial Court.
4 Crl.Appeal No.25355/2024
The substance of the accusation was read over and
explained to the Accused in the language known to him.
The Accused pleaded not guilty and claimed to be tried.
The Complainant got examined himself as PW.1 and got
marked Ex.P.1 to Ex.P.25 documents and closed his
side. The Accused examined a witness as DW-1 and got
marked Ex.D1 to Ex.D4.
5. The trial court after hearing the counsel for
Complainant and accused, convicted the Accused for the
offence punishable U/Sec.138 of NI Act vide Judgment
dtd 10.09.2024
6. Feeling aggrieved by the said judgment of
conviction, the Accused is in appeal on the following
grounds:
1. The impugned judgment and order of
sentence is illegal, arbitrary and without
appreciation of facts and evidence. The
reasons assigned are contrary to facts and
circumstances. The Judgment is against to
the principles of natural justice.
2. The learned trial court without perusing the
cross-examination of PW1 and without
considering the written arguments of the
appellant has passed the one sided
Judgment. The complainant not complied
5 Crl.Appeal No.25355/2024the ingredients of Sec.138 of NI Act. The
complainant not proved any evidence to
prove the transaction of Rs.25 lakhs and so
also issuance of cheque by the appellant.
There is dispute regarding the financial
ability and also legitimacy to the loan.
3. The trial court not observed the
contradictions in the evidence of PW1. The
document marked by accused and also the
evidence of DW1 shows that the alleged 3
cheques were issued only for the purpose of
security in respect of amount transferred by
the complainant to the account of one of the
director of the company for the share of wife
of accused and the said amount of Rs.10
lakhs was returned to complainant as
shown in Ex.D3 along with interest of
Rs.1,40,000/-. However the trial court has
not considered the same.
4. In the cross-examination PW1 admits that
the signature in Ex.P1 to 3 are different and
inspite of that the respondent has not taken
any fresh cheques from the accused and no
reason is given. The complainant has forged
the signature of accused after getting
information from their common friend Mr.
Bala that the appellant stopped payment of
the cheque after he returned the borrowed
amount of Rs.10 lakhs. The complainant not
6 Crl.Appeal No.25355/2024
lead evidence of witness No.3 stated by him.
The trial court wrongly concluded only by
taking into consideration the statement of
the complainant that he has given Rs.17
lakhs to his wife. Ex.P14 to 23 have no
relation to the loan transaction between
appellant and respondent. The respondent
himself deposed that apart from salary of
Rs. 1,50,000/- per month he did not have
any other income. He deposed that his wife
is house wife and every month paying an
EMI of Rs.22,000/- and children are doing
higher studies. Hence, the trial court has
not considered the above aspects. The trial
court overlooked important decisins of
Hon’ble Supreme Court and High Court. The
trial court committed error in appreciating
the evidence and failed to compare the
signature of accused on Ex.P9 postal postal
acknowledgment and Ex.P1 to 3 which are
entirely different. The respondent failed to
prove any debt or liability on the part of
accused. The reasons assigned by the trial
court is not proper.
5. The impugned Judgment is based on
assumptions and presumptions and not
based on evidence, admissions of the parties
and the transactions.
6. It is after repaying Rs.10 lakhs by way of
RTGS the accused issued stop payment
7 Crl.Appeal No.25355/2024
instructions to his banker. He has given
reply notice when he came to know about
the misuse of security cheques.
7. The evidence of respondent shows that it is
only cooked up story for tallying the
amountand all imaginary dates and he has
not examined any witness to prove said
transaction.
8. The complainant deposed that in the year
2016 he sold his property for Rs.70 lakhs
and he received Rs.40 lakhs through online
transfer and Rs.30 lakhs by way of cash.
The respondent was in possession of
unaccounted cash and he violated law. That
apart if the appellant had borrowed Rs.25
lakhs and if he had repaid Rs.10 lakhs then
how can complainant receive only alleged
cheques for 10 lakhs is not explained.
Except the business transaction between the
appellant and respondent there was no
personal financial transactions. In Ex.P10
reply notice he has stated under which
circumstances the alleged cheques came to
the hands of the complainant. The
complainant has misused the cheque inspite
of receiving the amount. Under the above
grounds the Appellant sought for setting
aside the impugned judgment by allowing
the appeal.
8 Crl.Appeal No.25355/2024
7. During the pendency of the Appeal the accused
filed an application u/sec.432 of BSA seeking permission
to produce the documents as additional evidence along
with application he has produced letter dated
02.12.2024 issued by the SBI. RTC Bus Stand Branch,
Rajampet, copy of PAN card.
8. Subsequently, the accused also filed another
application u/sec.72(1) of BSA with prayer to compare
signatures of the appellant on cheques with that of letter
issued by the State Bank of India dated 02.12.2024, PAN
Card, passport and driving license of accused.
9. The complainant filed objection stating that the
application u/sec.432 of BSN Act seeking to produce 2
documents i.e., letter issued by the Manager SBI, PAN
card is not maintainable. The document now sought to
be introduced were well within the knowledge of
appellant and he was in possession of the same during
the trial. Taking advantage of the statement of
complainant in his cross-examination “signatures on the
cheque appeared to be differ” the appellant is alleging
that blank cheques were issued, no prudent ma will take
a cheque without signature of drawer. An unsigned
9 Crl.Appeal No.25355/2024
cheque has no legal sanctity and it is nothing but a
waste paper.
10. In the objections to the application unde
Sec.72(1) of BSA the respondent contended that in the
appeal memorandum itself the accused in page 5
paragraph 14 admits issuance of cheque. It is the
appellant himself deliberately put varied signature with
ulterior motive, the endorsement issued by the bank
shows that cheque dishonoured for stop payment by the
drawer and not for mismatch of signatures. Accordingly,
prays to dismiss both the applications.
11. After service of notice to respondent the trial
court records were secured. Heard both sides arguments.
Appellant and Respondent have filed their written
arguments.
12. The counsel for Respondent has relied upon
following decision:
1. ILR 2006 KAR 1730 (Dr.B.V.Sampathkumar
Vs. Dr.K.G.V.Lakshmi)
13. Perused the evidence, documents on record
and also impugned Judgment of conviction passed by
10 Crl.Appeal No.25355/2024
the Trial Court. I have carefully gone through the
decision relied on by the Respondent.
14. On re-appreciation of the evidence, documents
on record, the following points would emerge for the
consideration of this court.
1.Whether the Appellant has made out
that the proposed documents are
necessary and relevant documents
for disposal of the case?
2. whether the appellant has made out
grounds that the signatures on the
said proposed documents are to be
compared with Ex.P1 to3 cheques?
3. Whether the Appellant proves that the
cheque in question was not issued
towards any legally recoverable debt?
4. Whether the Judgment of conviction
passed by the Trial Court calls for
interference by the hands of this
court?
5. What Order?
15. My finding on the above points are as under:
Point No.1 : In the Negative.
Point No.2 : In the Negative.
11 Crl.Appeal No.25355/2024
Point No.3 : In the Negative.
Point No.4 : In the Negative.
Point No.5 : As per final order for
the following:
REASONS
16. POINT NOs.1 to 4:-
Since the above points are interlinked, in order to
avoid repetition of facts the above points have been taken
up together for consideration.
17. Before re-appreciating the evidence on record, it
is necessary to refer the decision of the Hon’ble Apex
Court reported in 2019 (3) KCCR 2473 (SC)
(Basalingappa V/s Mudibasappa), which is relied on by
the accused wherein the Hon’ble Apex Court while
considering several earlier rulings on the offence
U/Sec.138 of NI Act and also on the presumption
U/Sec.118 and 139 of NI Act, at Para 23 was pleased to
observe as follows:
23. We having noticed the ratio laid down
by this Court in above cases on Sections 118(a)
and 139, we now summarise the principles
enumerated by this Court in following manner:-
(i) Once the execution of cheque is
admitted Section 139 of the Act mandates a
presumption that the cheque was for the
discharge of any debt or other liability.
12 Crl.Appeal No.25355/2024
(ii) The presumption under Section 139 is
a rebuttable presumption and the onus is on the
Accused to raise the probable defence. The
standard of proof for rebutting the presumption
is that of preponderance of probabilities.
(iii) To rebut the presumption, it is open
for the Accused to rely on evidence led by him
or Accused can also rely on the materials
submitted by the Complainant in order to raise
a probable defence. Inference of preponderance
of probabilities can be drawn not only from the
materials brought on record by the parties but
also by reference to the circumstances upon
which they rely.
(iv) That it is not necessary for the Accused to
come in the witness box in support of his
defence, Sec.139 imposed an evidentiary
burden and not a persuasive burden.
(v) It is not necessary for the Accused to
come in the witness box to support his defence.
18. In another ruling reported in AIR 2010 SC
1898 (Rangappa V/s Mohan),which is relied on by
accused the Honble Apex court has observed as
under:-
“Existence of legally recoverable debt or
liability- The presumption mandated by Section
139 of the Act does indeed include the
existence of a legally enforceable debt or
liability. This is of course in the nature of a
rebuttable presumption and it is open to the
Accused to raise a defence wherein the
13 Crl.Appeal No.25355/2024existence of a legally enforceable debt or
liability can be contested. However, there can
be no doubt that there is an initial presumption
which favours the Complainant. Section 139 of
the Act is an example of a reverse onus clause
that has been included in furtherance of the
legislative objective of improving the credibility
of negotiable instruments. While Section 138 of
the Act specifies a strong criminal remedy in
relation to the dishonour of cheques, the
rebuttable presumption under Section 139, is a
device to prevent undue delay in the course of
litigation. However, it must be remembered that
the offence made punishable by Section 138
can be better described as a regulatory offence
since the bouncing of a cheque is largely in the
nature of a civil wrong whose impact is usually
confined to the private parties involved in
commercial transactions. In such a scenario,
the test of proportionality should guide the
construction and interpretation of reverse onus
clauses and the Accused/defendant cannot be
expected to discharge an unduly high standard
or proof. In the absence of compelling
justifications, reverse onus clauses usually
impose an evidentiary burden and not a
persuasive burden. Keeping this in view, it is a
settled position that when an Accused has to
rebut the presumption under Section 139, the
standard of proof for doing so is that of
‘preponderance of probabilities’. Therefore, if
the Accused is able to raise a probable defence
which creates doubts about the existence of a
legally enforceable debt or liability, the
prosecution can fail. The Accused can rely on
the materials submitted by the Complainant
and it is conceivable that in some cases the
Accused may not need to adduce evidence of
his/her own.”
14 Crl.Appeal No.25355/2024
19. Keeping in view the broad principles laid down
by the Hon’ble Apex Court, let me re-appreciate the
evidence and documents on record.
20. The definite case of the
Complainant/Respondent is that the wife of accused and
wife of complainant were directors of various companies
and out of that acquaintance the accused availed credit
facility of Rs.25 lakhs from the complainant during the
interval in between January 2017 to November 2018 and
assured to repay the amount on demand. When the
complainant asked for repayment of the amount the
accused paid Rs.10 lakhs on 06.12.2018 towards the
discharge of partial liability and to discharge further
liability the accused issued cheque bearing No.280400
dated 10-12-2018 for a sum of Rs.4 lakhs, cheques
bearing No. 280401 and 280401 dated 10.12.2018 for a
sum of Rs.3 lakhs each. The complainant presented the
said 3 cheques before his banker and the said cheques
returned with an endorsement payment stopped by the
drawer on 11.02.2019. Hence, the complainant issued
legal notice on 07.03.2019 to the accused. The said
notice is duly served on accused on 09.03.2019. The
accused has given reply and thereafter the complainant
15 Crl.Appeal No.25355/2024
has issued rejoinder notice dated 09.04.2019. However
the accused not paid the amount of cheques.
21. The complainant in order to prove his case got
examined himself as P.W.1 and got marked in all 25
documents as per Ex.P1 to Ex.P25 and closed his side
evidence. The accused examined himself as D.W.1 and
got marked 4 documents as per Ex.D1 and Ex.D4.
22. Let me go through the documentary evidence placed
by the Complainant in this case. Ex.P.1 to 3 are original
cheques dated 10.12.2018, Ex.P4 to 6 are bank
endorsement dated 11.02.2019. Ex.P7 is copy of notice
dated 07.03.2019. Ex.P8 is postal receipt dated
08.03.2019. Ex.P9 is postal acknowledgment. Ex.P10 is
reply dated 19.03.2019. Ex.P11 is Rejoinder dated
09.04.2019, Ex.P12 is postal receipt dated 09.04.2019,
Ex.P13 is Release Deed dated 20.08.2016, Ex.P14 to 21
are income tax returns, Ex.P22 & 23 are bank statement,
Ex.P24 is Release Deed dated 29.08.2016 and Ex.P25 is
certificate u/sec.65(B) of Indian Evidence Act.
23. On the contrary the accused has produced copy
of bank statement of DW1as per Ex.D1, copy of bank
statement of wife of DW1as per Ex.D2, Bank statement
16 Crl.Appeal No.25355/2024
of partner of DW1 as per Ex.D3, certificate under
Sec.65(B) of Indian Evidence Act as per Ex.D4
24. Now let us go through the cross-examination of PW-
1/complainant. This P.W.1 in his cross-examination
deposed that he is soft ware engineer and getting salary
of Rs. 1,50,000/- every month, he has no other source of
income. His wife is home maker and he is paying
monthly rent of Rs.22,000/- and his children are doing
higher education. Accused was introduced by his
colleague. His wife has invested Rs.19 lakhs in Infimity
pvt. Ltd co., and said amount was paid by him to his
wife. He has produced sale deeds. As the accused
expresed urgency and also to solve the litigation in
respect of land at Nellore sought amount and hence he
paid amount. He sold his 2 sites for Rs.70 lakhs and he
received Rs 50 lakhs online and Rs 20 lakhs in cash. Out
of due amount of Rs.25 lakhs accused paid only Rs.10
lakhs.
25. This PW1 denied that the accused borrowed
Rs.10 lakhs as loan from him and he cleared the said
loan and there is no othe due to him. He denied that the
wife of accused totally invested Rs.10 lakhs to the
17 Crl.Appeal No.25355/2024
company. He denied that he has no financial capacity to
lend amount of Rs.10 lakhs. The signature on Ex.P1 to 3
are different. However according to him it is the accused
only put signatures on cheques. He do not know on
Ex.P9 whose signature it is.
26. On perusal of the cross-examination of DW1 he
deposed that he is colleague of complainant. His wife as
well as wife of accused are directors of a company. He
deposed that he knows that the accused borrowed
amount from the complainant. He do not know about the
transaction held between accused and complainant after
2017. the wives of accused, DW1 and complainant and 3
ohters are directors of a company and they have invested
amount equally. He has no document to show the wife of
accused also invested amount. He is witness only to the
transaction between accused and complainant for a sum
of Rs.10 lakhs. However the very next moment the
witness deposed that he is not witness to the transaction
and he do not know whether the cheque at Ex.P1 to 3
are pertains to the account of accused. He denied that
the amount of Rs.1,40,000/- paid by him is towards the
loan borrowed by him and it is its repayment.
18 Crl.Appeal No.25355/2024
27. In the case on hand it is not in dispute that the
cheque marked at Ex.P1 to 3 are pertains to the account
of accused. However the major defence of the accused is
in respect of the financial capacity of the complainant
and in respect of signature found on Ex.P1 to 3 However
on perusal of the bank endorsement marked at Ex.P4 to
6 the same shows that the above Ex.P1 to 3 cheques
returned for the reasons payment stopped by the drawer
and not for any other reason like there is difference in
signature or signature differs or signature mismatch.
28. On perusal of the reply notice Ex.P10 the
accused has stated that he has received amount of Rs.10
lakhs only from the complainant. In the reply notice he
further contended that the said amount was borrowed
infusing funds into company, Utara Informatice Pvt. Ltd.,
run by the wife of complainant and wife of accused who
were directors of the company along with 4 others
directors and share holders. He also contended that the
3 cheques are issued as security for Rs.10 lakhs at the
time of lending amount. Hence, the said cheques are
issued as security at the time of taking loan from Sashi
Mahidhar and Vasanth Kumar and this complainant,
but the complainant not returned the said cheques even
19 Crl.Appeal No.25355/2024
after receiving the amount of Rs.10 lakhs. It is after
payment of Rs.10 lakhs the accused informed his banker
to stop payment for the above 3 cheques. He also
contended that there is no legally enforceable debt.
29. On careful perusal of the entire reply notice
given by this accused to the legal notice of the
complainant this accused no where specifically denied
the fact that the signature on 3 cheques are not his
signatures. Thereafter on 09.04.2019 the complainant
has issued rejoinder to the reply notice of accused. It is
necessary to note that this accused is not a layman and
on the contrary the accused as well as this complainant
are well educated and are having knowledge of sanctity
of a instrument like cheques. The fact that a cheque in
blank without any signature of the drawer is nothing but
a waste paper and no prudent man will receive such a
cheque.
30. It is necessary to note that this accused has
taken specific defence before this appellate court that the
signature found on Ex.P1 to 3 are not his signatures. If
that is the case then this accused could have stated the
said fact of not putting or affixing signature on Ex.P1 to
20 Crl.Appeal No.25355/2024
3 cheques in his reply notice. The accused has simply
stated that he issued 3 blank cheques. However to
establish the fact that the signature on Ex.P1 to 3 are
not his signatures this accused has not taken any steps.
That apart it is also necessary to note that as discussed
supra Ex.P1 to 3 returned for the reasons payment
stopped by the drawer and not for any other reasons.
The accused not made any efforts to get summon his
specimen signatures available before his banker to get it
compared with Ex.P1 to 3. Since it is not the defence
taken in reply notice and as the said defence is taken
before this court the burden is on the accused.
31. In the reply notice this accused has not taken
any such defence that the cheques issued by him were
not signed. The accused stated that the cheques are
issued only for the purpose of security. It is necessary to
note that in the entire cross-examination there is no
suggestion by the accused to the PW1 that the cheques
issued to complainant were blank. It is only suggested as
follows. “it is true to suggest that signature of Ex.P1 to 3
are different”. However PW1 has deposed voluntarily that
the accused only put signatures on cheques. I do not
know on Ex.P9 whose signature is there. I have not seen
21 Crl.Appeal No.25355/2024
PAN Card of accused before collecting the cheques from
him. I have never seen PAN card of accused earlier.
Hence the contention of the accused that the signature
on Ex.P1 to 3 cheques are not that of him is not
established.
32. When once the cheques are issued voluntarily
to the complainant and when once the cheques are
admittedly pertains to the accout of accused and when
the signature on the said cheque is of the accused then
there is an initial presumption in favor of the
complainant as provided under Sec.118 and 139 of NI
Act and the burden is on the accused to rebut the said
presumption by taking appropriate defence on the
principles of preponderance of probabilities.
33. With this factual matrix, firstly the court has to
appreciate whether there are materials to ascertain the
existence of legally enforceable debt. At the outset, the
Court has to appreciate whether Section 138 of The Act
is made out. When the cheque is produced before the
Court and when it came to be dishonored for funds
insufficient or for any other reason and when the legal
notice was issued within the statutory period then the
22 Crl.Appeal No.25355/2024
presumption available under Sections 118 & 139 of The
Act is made out in favour of the complainant. The
provisions of Section 118 of The Act are separated from
the general rule applicable to the contracts and it
provides presumption in favour of the party. The said
presumptions are that: unless the contrary is proved the
Court has to presume that the consideration had passed
between the parties as enumerated under Section 118 of
NI Act. Likewise, unless the contrary is established
Section 139 of the NI Act clearly establishes that the
holder of the cheque had received the same towards
discharge of the legally enforceable debt either towards
whole or partial liability. The said presumptions have to
be read conjointly in order to ascertain whether the
ingredients are made out. Further, the said
presumptions are rebuttable and the same has to be
appreciated with the factual aspects of the case. The
impugned cheque at Ex.P1 to 3 were drawn during the
period of their validity and were accordingly presented to
the bank and after its dishonor the notice was also
issued and later on after completing all the statutory
bound obligations the complaint came to be filed. This
clearly indicates that initial presumption is drawn in
favour of the complainant. It is also relevant to note that
23 Crl.Appeal No.25355/2024
the said presumption is rebuttable one and as such the
defence of the accused has to be appreciated in order to
ascertain whether the presumption which is drawn
initially in favour of the complainant has been
successfully rebutted.
34. The law is well settled that the accused need
not enter the witness box to rebut initial presumption. At
the same time, the defense which is taken up by the
accused is to be appreciated so as to ascertain whether
the same was probable or not. The accused taken
defence that there is no legally enforceable debt, the
cheque in question are issued only as security, he has
issued only blank cheque without signature, the
complainant has no financial capacity and he borrowed
only Rs.10 lakhs and the same is repaid to the
complainant along with interest. However as could be
seen from the cross-examination of complainant nothing
is elicited to prove the above defence. As discussed supra
there is an initial presumption in favour of the
complainant. The accused has voluntarily issued the
cheques to the complainant. The said cheque on
presentation returned dishonored as payment stopped
by drawer.
24 Crl.Appeal No.25355/2024
35. It is to be noted that, the cheques in the present
case is returned for the reason “payment stopped by drawer”.
The law is settled that, even in such circumstance, the
offence under section 138 of NI Act is attracted. In this
regard, reference may be made to the law laid down Hon’ble
Apex Court in the case of Laxmi Dyechem vs. State of
Gujarat and Ors. (2012)13SCC375, as follows;
11. In Modi Cements Ltd. (supra) a similar question had
arisen for the consideration of this Court. The question was
whether dishonour of a cheque on the ground that the
drawer had stopped payment was a dishonour punishable
under Section 138 of the Act. Relying upon two earlier
decisions of this Court in Electronics Trade & Technology
Development Corporation Ltd. v. Indian Technologists and
Engineers (Electronics) (P) Ltd. MANU/SC/0591/1996 :
(1996) 2 SCC 739 and K.K Sidharthan v. T.P. Praveena
Chandran MANU/SC/1261/1996 : (1996) 6 SCC 369, it
was contended by the drawer of the cheque that if the
payment was stopped by the drawer, the dishonour of the
cheque could not constitute an offence under Section 138 of
the Act. That contention was specifically rejected by this
Court. Not only that, the decision in Electronics Trade &
Technology Development Corporation Ltd. (supra) to the
extent the same held that dishonour of the cheque by the
bank after the drawer had issued a notice to the holder not
to present the same would not constitute an offence, was
overruled. This Court observed:
18. The aforesaid propositions in both these reported
judgments, in our considered view, with great respect are
contrary to the spirit and object of Sections 138 and 139 of
the Act. If we are to accept this proposition it will
make Section 138 a dead letter, for, by giving
instructions to the bank to stop payment
immediately after issuing a cheque against a debt or
liability the drawer can easily get rid of the penal
consequences notwithstanding the fact that a
deemed offence was committed. Further the following
observations in para 6 in Electronics Trade & Technology
Development Corpn. Ltd. “Section 138 intended to prevent
25 Crl.Appeal No.25355/2024dishonesty on the part of the drawer of negotiable
instrument to draw a cheque without sufficient funds in his
account maintained by him in a bank and induce the payee
or holder in due course to act upon it. Section 138 draws
presumption that one commits the offence if he issues the
cheque dishonestly” (emphasis supplied) in our opinion, do
not also lay down the law correctly.
20. On a careful reading of Section 138 of the Act, we are
unable to subscribe to the view that Section 138 of the Act
draws presumption of dishonesty against drawer of the
cheque if he without sufficient funds to his credit in his
bank account to honour the cheque issues the same and,
therefore, this amounts to an offence under Section 138 of
the Act. For the reasons stated hereinabove, we are unable
to share the views expressed by this Court in the above
two cases and we respectfully differ with the same
regarding interpretation of Section 138 of the Act to the
limited extent as indicated above.
12. We may also at this stage refer to the decisions of this
Court in M.M.T.C. Ltd. and Anr. v. Medchl Chemicals and
Pharma (P) Ltd. and Anr. MANU/SC/0728/2001 : (2002) 1
SCC 234, where too this Court considering an analogous
question held that even in cases where the dishonour
was on account of “stop payment” instructions of the
drawer, a presumption regarding the cheque being
for consideration would arise under Section 139 of
the Act. The Court observed:
19. Just such a contention has been negatived by this
Court in the case of Modi Cements Ltd. v. Kuchil Kumar
Nandi. It has been held that even though the cheque
is dishonoured by reason of “stop-payment”
instruction an offence under Section 138 could still
be made out. It is held that the presumption under
Section 139 is attracted in such a case also. The
authority shows that even when the cheque is dishonoured
by reason of stop-payment instructions by virtue of Section
139 the court has to presume that the cheque was received
by the holder for the discharge, in whole or in part, of any
debt or liability. of course this is a rebuttable presumption.
The accused can thus show that the “stop-payment”
instructions were not issued because of insufficiency or
paucity of funds. If the accused shows that in his account
there were sufficient funds to clear the amount of the
26 Crl.Appeal No.25355/2024
cheque at the time of presentation of the cheque for
encashment at the drawer bank and that the stop-payment
notice had been issued because of other valid causes
including that there was no existing debt or liability at the
time of presentation of cheque for encashment, then offence
under Section 138 would not be made out. The important
thing is that the burden of so proving would be on the
accused. Thus a court cannot quash a complaint on this
ground.
(Emphasis Supplied)
36. In the light of the above law laid down by Hon’ble
Apex Court, it is clear that, even in the case where cheque is
returned for the reason “payment stopped by drawer”, not
only the offence under section 138 of NI Act is attracted but
more importantly the presumption under section 139 of NI
Act would also arise, in such a case.
37. The witness of the accused i.e., DW1 admits
that he knows accused has borrowed loan from the
complainant. This witness of accused further deposed he
do not know about the transaction held between accused
and complainant after 2017. This witness though
deposed that his wife as well as wife of accused and wife
of complainant were directors and have equally invested
amount in the company has not placed any evidence.
The evidence of this witness support the case of the
complainant that this accused borrowed loan from the
complainant. The repayment of Rs.10 lakhs according to
27 Crl.Appeal No.25355/2024
complainant is for some other transaction. Though the
accused denied the financial capacity of the complainant
the account statement relied by the complainant shows
that he was having sufficient amount in his account at
relevant point of time. Even sale transaction stated by
the complainant shows he was having amount with him.
Thought the accused contended that it is unaccounted
money it is necessary to note that it is for the concerned
income tax department to take action in this regard and
accused is not concerned with that. The release deed
marked at Ex.P13 shows that the complainant released
his rights and received consideration. Hence, the
contention of the accused that complainant has no
financial capacity is not proved.
38. The accused not proved that it is only Rs.10
lakhs which was borrowed by him and he repaid the
same to complainant. If the accused borrowed only
Rs.10 lakhs and repaid the said amount then he could
have asked the complainant to return his cheques or to
issued endorsement in respect of receiving said cheques
only as security in respect of the amount invested by his
wife. However the accused has not taken any such action
and not issued any such notice. The accused also had
28 Crl.Appeal No.25355/2024
option to register necessary complaint before the
jurisdictional police or jurisdictional magistrate for
misuse of his cheques which were issued as security.
However the accused has not done so.
39. The accused to establish that Ex.P1 to 3
cheques are issued as security not placed any evidence.
Except bald contentions that the cheques are issued as
security no cogent evidence is placed. The accused
himself is not certain about his defence. At one juncture
this accused admits that he borrowed only Rs.10 lakhsa
and he repaid the said amount. However he kept quiet
without asking return of his cheques if there was no due.
40. The court is well aware of the cardinal principle
of law, that the burden will be upon the prosecution to
prove the case beyond reasonable doubt. However, a
duty is also casted upon the Accused to successfully
rebut the presumption which is raised by the
complainant. Admittedly, the complainant has
discharged the initial burden as already discussed supra
and as such the onus will be shifted upon the accused to
rebut the same.
29 Crl.Appeal No.25355/2024
41. As discussed supra, the accused himself admits
that, Ex.P.1 to 3 cheques are pertains to his account and
the signature on said cheques as discussed above are
signatures of accused. Hence, there is presumption in
faovur of complainant. The accused utterly failed to
prove his defence. With respect to the presumption and
also the defense of misuse of cheque taken up by the
Appellant the court has relied upon the judgment of the
Hon’ble Apex Court reported in (2018)8 SCC 165
(Kishan Rao V/s Shankaregowda) wherein it has been
held thus:
Section 139 of the Act, 1881 provides for
drawing the presumption in favour of holder.
Section 139 is to the following effect:
“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 section 138 for the
discharge, in whole or in part, of any debt or
other liability.”
18. This Court in Kumar Exports vs. Sharma
Carpets, 2009 (2) SCC 513, had considered the
provisions of Negotiable Instruments Act as
Referring to 139, this Section well Evidence Court
laid following in paragraphs 14, 15, 18 and 19:
Section 139 of the Act provides that it shall
be presumed, unless the contrary is proved, that
the holder of a cheque received the cheque of the
nature referred to in Section 138 for the
discharge, in whole or in part, of any debt or
other liability.
30 Crl.Appeal No.25355/2024
15. Presumptions are devices by use of which
the courts are enabled and entitled to pronounce
on an issue notwithstanding that there is no
evidence or insufficient evidence. Under the
Evidence Act all presumptions must come under
one or the other class of the three classes
mentioned in the Act, namely, (1) “may presume”
(rebuttable), (2) “shall presume” (rebuttable), and
(3) “conclusive presumptions” (irrebuttable). The
term “presumption” is used to designate an
inference, affirmative or disaffirmative of the
existence of a fact, conveniently called the
“presumed fact” drawn by a judicial tribunal, by a
process of probable reasoning from some matter
of fact, either judicially noticed or admitted or
established by legal evidence to the satisfaction
of the tribunal. Presumption literally means
“taking as true without examination or proof”.
18. Applying the definition of the word
“proved” in Section 3 of the Evidence Act to the
provisions of Sections 118 and 139 of the Act, it
becomes evident that in a trial under Section 138
of the Act a presumption will have to be made
that every negotiable instrument was made or
drawn for consideration and that it was executed
for discharge of debt or liability once the
execution of negotiable instrument is either
proved or admitted. As soon as the complainant
discharges the burden to prove that the
instrument, say a note, was executed by the
accused, the rules of presumptions under
Sections 118 and 139 of the Act help him shift
the burden on the accused. The presumptions will
live, exist and survive and shall end only when
the contrary is proved by the accused, that is, the
cheque was not issued for consideration and in
discharge of any debt or liability. A presumption
is not in itself evidence, but only makes a prima
facie case for a party for whose benefit it exists.
19. The use of the phrase “until the contrary
is proved” in Section 118 of the Act and use of
the words “unless the contrary is proved” in
31 Crl.Appeal No.25355/2024
Section 139 of the Act read with definitions of
“may presume” and “shall presume” as given in
Section 4 of the Evidence Act, makes it at once
clear that presumptions to be raised under both
the provisions are rebuttable. When a
presumption is rebuttable, it only points out that
the party on whom lies the duty of going forward
with evidence, on the fact presumed and when
that party has produced evidence fairly and
reasonably tending to show that the real fact is
not as presumed, the purpose of the presumption
is over.”
19. This Court held that the accused may
adduce evidence to rebut the presumption, but
mere denial regarding existence of debt shall not
serve purpose. Following was held in paragraph
20:
“20….The accused may adduce direct
evidence to prove that the note in question was
not supported by consideration and that there
was no debt or liability to be discharged by him.
However, the court need not insist in every case
that the accused should disprove the non-
existence of consideration and debt by leading
direct evidence because the existence of negative
evidence is neither possible nor contemplated. At
the same time, it is clear that bare denial of the
passing of the consideration and existence of
debt, apparently would not serve the purpose of
the accused. Something which is probable has to
be brought on record for getting the burden of
proof shifted to the complainant. To disprove the
presumptions, the accused should bring on record
such facts and circumstances, upon consideration
of which, the court may either believe that the
consideration and debt did not exist or their non-
existence was so probable that a prudent man
would under the circumstances of the case, act
upon the plea that they did not exist…”
20. In the present case, the trial court as well
as the Appellate Court having found that cheque
contained the signatures of the accused and it
32 Crl.Appeal No.25355/2024
was given to the appellant to present in the Bank
of the presumption under Section 139 was rightly
raised which was not rebutted by the accused.
The accused had not led any evidence to rebut
the aforesaid presumption. The accused even did
the not come in the presumption. The accused
even did not come in the witness box to support
his case. In the reply to the notice which was
given by the appellant the accused took the
defence that the cheque was stolen by the
appellant. The said defence was rejected by the
trial court after considering the evidence on
regard with regard to which no contrary view has
also been expressed by the High Court.
21. Another judgment which needs to be
looked into is Rangappa vs. Sri Mohan, 2010 (11)
SCC 441. A three Judge Bench of this Court had
occasion to examine the presumption under
Section 139 of the Act, 1881. This Court in the
aforesaid case has held that in the event the
accused is able to raise a probable defence which
creates doubt with regard to the existence of a
debt or liability, the presumption may fail.
Following was laid down in paragraphs 26 and 27:
“26. In light of these extracts, we are in
agreement with the respondent claimant that the
presumption mandated by Section 139 of the Act
does indeed include the existence of a legally
enforceable debt or liability. To that extent, the
impugned observations in Krishna Janardhan
Bhat, (2008) 4 SCC 54, may not be correct.
However, this does not in any way cast doubt on
the correctness of the decision in that case since
it was based on the specific facts and
circumstances therein. As noted in the citations,
this is of course in the nature of a rebuttable
presumption and it is open to the accused to raise
a defence wherein the existence of a legally
enforceable debt or liability can be contested.
However, there can be no doubt that there is an
initial presumption which favours the
complainant.
33 Crl.Appeal No.25355/2024
27. Section 139 of the Act is an example of a
reverse onus clause that has been included in
furtherance of the legislative objective of
improving the credibility of negotiable
instruments. While Section 138 of the Act
specifies a strong criminal remedy in relation to
the dishonour of cheques, the rebuttable
presumption under Section 139 is a device to
prevent undue delay in the course of litigation.
However, it must be remembered that the offence
made punishable by Section 138 can be better
described as a regulatory offence since the
bouncing of a cheque is largely in the17 nature of
a civil wrong whose impact is usually confined to
the private parties involved in commercial
transactions. In such a scenario, the test of
proportionality should guide the construction and
interpretation of reverse onus clauses and the
defendant-accused cannot be expected to
discharge an unduly high standard or proof.”
22. No evidence was led by the accused. The
defence taken in the reply to the notice that
cheque was stolen having been rejected by the
two courts below, we do not see any basis for the
High court coming to the conclusion that the
accused has been successful in creating doubt in
the mind of the Court with regard to the
existence of the debt or liability. How the
presumption under Section 139 can be rebutted
on the evidence of PW.1, himself has not been
explained by the High court.
42. The sum and substance is that there is a
presumption in favour of holder of cheque in due course.
The accused failed to prove contrary. Lastly the Court
has also appreciated the statement of Accused recorded
under Sec.313 of Cr.P.C. regarding the evidence under
34 Crl.Appeal No.25355/2024
Sec.313 of Cr.P.C., is not a bald formality. In fact, it is an
opportunity rendered to the Accused to explain the
incriminating materials against him. However, the
Accused has only denied and stated that he has repaid
amount of Rs.10 lakhs borrowed by him to the
complainant. However the accused utterly failed to
establish if the loan borrowed only Rs.10 lakhs why he
kept quiet without taking any action against complainant
for misuse of his cheques. Hence, accused failed to rebut
the presumption available in favor of complainant.
Whether this Accused has taken any legal action as
against the complainant in respect of misusing of his
cheque is not forthcoming. Under the circumstances, the
burden of proof is successfully established by the
complainant and as such, with respect to the existence
of legally enforceable debt and its presumption, the
Court has relied upon the judgment of Hon’ble Apex
Court reported in (2019) 10 SCC 287 (Uttam Ram V.
Devinder Singh Hudan and another) wherein it has
been held as;
18. We find that the approach of the learned Trial
Court and that of the High Court is perverse;
irrational as well as suffers from material illegality
and irregularity, which cannot be sustained in
complaint filed under Section 138 of the Act.
35 Crl.Appeal No.25355/2024
19. A negotiable instrument including a cheque
carries presumption of consideration in terms of
Section 118(a) and under Section 139 of the Act.
Sections 118(a) and 139 read as under:
“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;….
xxx xxx xxx
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 section 138 for the
discharge, in whole or in part, of any debt or other
liability.”
20. The Trial Court and the High Court proceeded
as if, the appellant is to prove a debt before civil
court wherein, the plaintiff is required to prove
his claim on the basis of evidence to be laid in
support of his claim for the recovery of the
amount due. A dishonour of cheque carries a
statutory presumption of consideration. The
holder of cheque in due course is required to
prove that the cheque was issued by the accused
and that when the same presented, it was not
honoured. Since there is a statutory presumption
of consideration, the burden is on the accused to
rebut the presumption that the cheque was issued
not for any debt or other liability.
21. There is the mandate of presumption of
consideration in terms of the provisions of the
36 Crl.Appeal No.25355/2024
Act. The onus shifts to the accused on proof of
issuance of cheque to rebut the presumption that
the cheque was issued not for discharge of any
debt or liability in terms of Section 138 of the Act
which reads as under:
“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….”
22. In Kumar Exports, it was held that mere
denial of existence of debt will not serve any
purpose but accused may adduce evidence to
rebut the presumption. This Court held as under:
“20. The accused in a trial under Section 138 of
the Act has two options. He can either show that
consideration and debt did not exist or that under
the particular circumstances of the case the non-
existence of consideration and debt is so probable
that a prudent man ought to suppose that no
consideration and debt existed. To rebut the
statutory presumptions an accused is not
expected to prove his defence beyond reasonable
doubt as is expected of the complainant in a
criminal trial. The accused may adduce direct
evidence to prove that the note in question was
not supported by consideration and that there
was no debt or liability to be discharged by him.
However, the court need not insist in every case
that the accused should disprove the non-
37 Crl.Appeal No.25355/2024
existence of consideration and debt by leading
direct evidence because the existence of negative
evidence is neither possible nor contemplated. At
the same time, it is clear that bare denial of the
passing of the consideration and existence of
debt, apparently would not serve the purpose of
the accused. Something which is probable has to
be brought on record for getting the burden of
proof shifted to the complainant. To disprove the
presumptions, the accused should bring on record
such facts and circumstances, upon consideration
of which, the court may either believe that the
consideration and debt did not exist or their non-
existence was so probable that a prudent man
would under the circumstances of the case, act
upon the plea that they did not exist. Apart from
adducing direct evidence to prove that the note in
question was not supported by consideration or
that he had not incurred any debt or liability, the
accused may also rely upon circumstantial
evidence and if the circumstances so relied upon
are compelling, the burden may likewise shift
again on to the complainant. The accused may
also rely upon presumptions of fact, for instance,
those mentioned in Section 114 of the Evidence
Act to rebut the presumptions arising under
Sections 118 and 139 of the Act.” (emphasis
supplied)
23. In a judgment reported as Kishan Rao v.
Shankargouda6, this Court referring to Kumar
Exports and Rangappa returned the following
findings:
“22. Another judgment which needs to be looked
into is Rangappa v. Sri Mohan [Rangappa v. Sri
Mohan, (2010) 11 SCC 441 : (2010) 4 SCC (Civ)
477 : (2011) 1 SCC (Cri) 184] . A three-Judge
Bench of this Court had occasion to examine the
presumption under Section 139 of the 1881 Act.
This Court in the aforesaid case has held that in
the event the accused is able to raise a probable
38 Crl.Appeal No.25355/2024defence which creates doubt with regard to the
existence of a debt or liability, the presumption
may fail. Following was laid down in paras 26 and
27: (SCC pp. 453-54) “26. In light of these
extracts, we are in agreement with the respondent
claimant that the presumption mandated by
Section 139 of the Act does indeed include the
existence of a legally enforceable debt or liability.
To that extent, the impugned observations in
Krishna Janardhan Bhat [Krishna Janardhan Bhat
v. Dattatraya G. Hegde, (2008) 4 SCC 54 : (2008) 2
SCC (Cri) 166], may not be correct. However, this
does not in any way cast doubt on the correctness
of the decision in that case since it was based on
the specific facts and circumstances therein. As
noted in the citations, this is of course in the
nature of a rebuttable presumption and it is open
to the accused to raise a defence wherein the
existence of a legally enforceable debt or liability
can be contested. However, there can be no doubt
that there is an initial presumption which favours
the complainant.
27. Section 139 of the Act is an example of a
reverse onus clause that has been included in
furtherance of the legislative objective of
improving the credibility of negotiable
instruments. While Section 138 of the Act
specifies a strong criminal remedy in relation to
the dishonour of cheques, the rebuttable
presumption under Section 139 is a device to
prevent undue delay in the course of litigation.
However, it must be remembered that the offence
made punishable by Section 138 can be better
described as a regulatory offence since the
bouncing of a cheque is largely in the nature of a
civil wrong whose impact is usually confined to
the private parties involved in commercial
transactions. In such a scenario, the test of
proportionality should guide the construction and
interpretation of reverse onus clauses and the
39 Crl.Appeal No.25355/2024defendant-accused cannot be expected to
discharge an unduly high standard of proof.”
24. In a judgment reported as Bir Singh v. Mukesh
Kumar7, this Court held that presumption under
Section 139 of the Act is a presumption of law.
The Court held as under:
“20. Section 139 introduces an exception to the
general rule as to the burden of proof and shifts
the onus on the accused. The presumption under
Section 139 of the Negotiable Instruments Act is a
presumption of law, as distinguished from
presumption of facts. Presumptions are rules of
evidence and do not conflict with the
presumption of innocence, which requires the
prosecution to prove the case against the accused
beyond reasonable doubt. The obligation on the
prosecution may be discharged with the help of
presumptions of law and presumptions of fact
unless the accused adduces evidence showing the
reasonable possibility of the non-existence of the
presumed fact as held in Hiten P. Dalal [Hiten P.
Dalal v. Bratindranath Banerjee, (2001) 6 SCC 16 :
2001 SCC (Cri) 960] .
xxx xxx xxx
33. A meaningful reading of the provisions of the
Negotiable Instruments Act including, in
particular, Sections 20, 87 and 139, makes it
amply clear that a person who signs a cheque and
makes it over to the payee remains liable unless
he adduces evidence to rebut the presumption
that the cheque had been issued for payment of a
debt or in discharge of a liability. It is immaterial
that the cheque may have been filled in by any
person other than the drawer, if the cheque is
duly signed by the drawer. If the cheque is
otherwise valid, the penal provisions of Section
138 would be attracted.
40 Crl.Appeal No.25355/2024
xxx xxx xxx
36. Even a blank cheque leaf, voluntarily signed
and handed over by the accused, which is towards
some payment, would attract presumption under
Section 139 of the Negotiable Instruments Act, in
the absence of any cogent evidence to show that
the cheque was not issued in discharge of a debt.”
25. In other judgment reported as Rohitbhai
Jivanlal Patel v. State of Gujarat and Another8
this Court held as under:
“18. So far the question of existence of basic
ingredients for drawing of presumption under
Sections 118 and 139 the NI Act is concerned,
apparent it is that the accused- appellant could
not deny his signature on the cheques in question
that had been drawn in favour of the complainant
on a bank account maintained by the accused for
a sum of Rs. 3 lakhs each. The said cheques were
presented to the Bank concerned within the
period of their validity and were returned unpaid
for the reason of either the balance being
insufficient or the account being closed. All the
basic ingredients of Section 138 as also of
Sections 118 and 139 are apparent on the face of
the record. The Trial Court had also consciously
taken note of these facts and had drawn the
requisite presumption. Therefore, it is required to
be presumed that the cheques in question were
drawn for consideration and the holder of the
cheques i.e., the complainant received the same
in discharge of an existing debt. The onus,
therefore, shifts on the accused-appellant to
establish a probable defence so as to rebut such a
presumption.”
xxx xxx xxx
20. On the aspects relating to preponderance of
probabilities, the accused has to bring on record
41 Crl.Appeal No.25355/2024
such facts and such circumstances which may
lead the Court to conclude either that the
consideration did not exist or that its
nonexistence was so probable that a prudent man
would, under the circumstances of the case, act
upon the plea that the consideration did not
exist. This Court has, time and again, emphasized
that though there may not be sufficient negative
evidence which could be brought on record by the
accused to discharge his burden, yet mere denial
would not fulfil the requirements of rebuttal as 8
AIR 2019 SC 1876 envisaged under Section 118
and 139 of the NI Act…..
xxx xxx xxx
32. The result of discussion in the foregoing
paragraphs is that the major considerations on
which the Trial Court chose to proceed clearly
show its fundamental error of approach where,
even after drawing the presumption, it had
proceeded as if the complainant was to prove his
case beyond reasonable doubt. Such being the
fundamental flaw on the part of the Trial Court,
the High Court cannot be said to have acted
illegally or having exceeded its jurisdiction in
reversing the judgment of acquittal. As noticed
hereinabove, in the present matter, the High
Court has conscientiously and carefully taken
into consideration the views of the Trial Court
and after examining the evidence on record as a
whole, found that the findings of the Trial Court
are vitiated by perversity. Hence, interference by
the High Court was inevitable; rather had to be
made for just and proper decision of the matter.”
43. To sum up it is noticed that the Accused has
admitted the impugned cheques at Ex.P1to 3 and also its
42 Crl.Appeal No.25355/2024
issuance is categorically admitted by him, whereas it is
contended that he cleared the entire dues of complainant
is not corroborated by any evidence. There is absolutely
no explanation that why he had kept quiet if he had
really borrowed only Rs.10 lakhs and repaid the said
amount to the complainant without lodging any
complaint before jurisdictional police about misuse of
cheque by the complainant. In the entire defence of the
accused there is no explanation in this regard. The same
shows that the accused has not taken defence which is
certain and which is probable and as such the Accused
has failed to rebut the presumption.
44. The accused argued that he must be permitted
to produce the document produced along with
application u/sec.432 of BNSS and the documents
produced by him shows his signatures and they are tobe
compared with Ex.P1 to 3. It is pertinent to note that the
proposed documents which the accused wants to place
reliance and wants to produce and wants comparison are
1) letter of Manager SBI, RTC Bus Stand Branch,
Rajampet dated 02.12.2024 and 2) PAN card, 3)
Passport, and 4) driving licence.
43 Crl.Appeal No.25355/2024
45. It is necessary to note that these documents are
very much available with the accused on the date of
leading his side evidence before the trial court. Before the
trial court this accused examined his witness
Balanarasimhulu Poluru on 06.03.2023. On the date of
leading evidence of his witness the document like
passport, DL, PAN card were very much available with
the accused. However this accused not chosen to
produce the said document before the trial court.
46. Even on careful perusal of the letter dated
02.12.2024 now produced in this appeal before this
court in the said letter it is stated that the signature
provided by accused today matches the signature
registered with the bank for the said account. In the
letter it is stated that the said account was opened in the
year 2016. It is necessary to note that if the signature on
Ex.P1 to 3 are not that of accused then how come the
endorsement is issued as ‘payment stopped by drawer’
instead of signature differs is remained unanswered.
47. At the time of opening the said account
definitely the accused will have furnished his signatures
before the said bank and he could have produced the
44 Crl.Appeal No.25355/2024
said specimen signature before the trial court for its
verification. However he has not done so. The admitted
signatures given by him before the bank on the date of
opening of the account were not furnished for verification
before the trial court.
48. That apart in the letter now the accused wants
to rely it is stated that the signatures on the PAN card
matches the signatures registered on the bank records.
However as stated above first and foremost in the entire
cross-examination before the trial court this accused
except bald suggestion that he has issued blank cheques
to the complainant has not posed any other suggestion.
The accused has not confront the PAN card, DL or
Passport to the complainant in the cross-examination.
The same clearly goes to shows that it is as an after
thought the accused has come up with this application
before the court in the Appeal. The proposed documents
being very much available with the custody of accused
since the date of his appearance before the trial court
has not made any efforts to produce the same before the
trial court and as an after thought he came with
application in the present appeal. The letter of SBI is
obtained after pronouncing the judgment and it does not
45 Crl.Appeal No.25355/2024
throw any light on the case or on the defence of the
accused as because as stated supra Ex.P1 to 3 returned
from the very same banker as ‘payment stopped by
drawer’. The proposed documents do not throw any light
and hence they are not relevant to decide the dispute on
merits. As the accused not denied his signature on
cheques in his reply notice and as the accused not posed
any question to PW1 in the cross examination and as the
Ex.P1 to 3 cheques returned as payment stopped by
drawer the argument of the accused that he must be
permitted to produce document has no bearing. The
accused hence not made out grounds to allow the
applications.
49. For all above reasons, I hold that, the
complainant has duly proved that the cheque at Ex. P1
to 3 is issued towards discharge of lawful liability. Once
this conclusion is reached and when there are no
technical defects in the complainant and all the
conditions of section 138 of NI Act are complied it follows
that the learned magistrate came to the correct
conclusion in holding that the accused has committed
the offence under section 138 of NI Act. The total value of
the cheque is Rs.10,00,000/- but under section 138 of
46 Crl.Appeal No.25355/2024
NI Act, the Learned magistrate can impose sentence of
upto twice the cheque amount and considering the facts
and circumstances of the case, the learned magistrate
was perfectly justified in imposing the fine of
Rs.13,24,000/- and compensation was awarded to
complainant out of the said fine amount. Therefore, the
impugned judgment and sentence does not call for
interference. Accordingly, none of the grounds raised in
the appeal memorandum, deserve acceptance. I have
already held supra for the detailed reasons discussed
that, the learned magistrate came to the correct
conclusion in convicting the appellant and sentencing
him as afore stated. Accordingly, I answered Point
Nos.1 to 4 in the Negative.
50. Point No.5: In view of the findings on the
above points the appeal filed by the Appellant deserves to
be dismissed. Accordingly, I proceed to pass the
following:-
ORDER
The application filed by appellant
u/sec.432 of BNSS is hereby dismissed.
The application filed by appellant
u/sec.72(1) of BSA is hereby dismissed.
47 Crl.Appeal No.25355/2024
The appeal filed by the Appellant
u/sec.374 (3) of Cr.P.C. is hereby dismissed
with costs.
The Judgment of conviction passed by
the Learned XXXIV ACJM Bengaluru, in
CC.No.53462/2019, dtd. 10.09.2024, is
hereby confirmed.
Send back the records with a copy of
this Judgment to the Trial Court.
(Dictated to the Stenographer, typed by her, corrected, signed and
then pronounced by me, in the open court on this the 27 th day of
April 2026.)
Digitally signed by
ANITHA
ANITHA NANJANAGUDU
NANJANAGUDU PARASHIVAMURTHY
PARASHIVAMURTHY
Date: 2026.05.15
18:00:25 +0530[Smt. Anitha N.P]
LXXIII Addl.City Civil & Sessions
Judge, Bengaluru. (CCH-74).
[ad_1]
Source link
