- 1 - NC: 2025:KHC:5895 CRL.A No. 1735 of 2018 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 10TH DAY OF FEBRUARY, 2025 BEFORE THE HON'BLE MR JUSTICE SHIVASHANKAR AMARANNAVAR CRIMINAL APPEAL NO. 1735 OF 2018 BETWEEN: SRI. NOORUDDEEN S/O LATE P.C.LATEEF AGED ABOUT 41 YEARS R/AT NO.3, 93/2, 1ST MAIN 15TH CROSS, K.T.J.NAGARA DAVANAGERE-577 002 …APPELLANT (BY SMT. THANIMA BEKAL, ADVOCATE FOR SRI. HAREESH BHANDARY T, ADVOCATE) AND: SRI. HAFIZULLA S/O SHEK SAHEB SAB AGED ABOUT 47 YEARS R/AT DOOR NO.1172/1 2ND MAIN, 5TH CROSS K.T.J.NAGARA DAVANAGERE-577 002 …RESPONDENT (BY SRI. U. PANDURANGA NAYAK, ADVOCATE) THIS CRL.A. IS FILED U/S.378(4) CR.P.C PRAYING TO SET ASIDE THE JUDGMENT AND ORDER OF ACQUITTAL DATED 04.08.2018 PASSED BY THE JUDICIAL MAGISTRATE FIRST CLASS, II COURT, DAVANAGERE IN C.C.NO.2456/2015, Digitally signed by HEMAVATHY GANGABYRAPPA Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC:5895 CRL.A No. 1735 of 2018 ACQUITTING THE RESPONDENT/ACCUSED FOR THE OFFENCE P/U/S 138 OF N.I. ACT. THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE SHIVASHANKAR AMARANNAVAR ORAL JUDGMENT This appeal is filed by the complainant challenging the judgment of acquittal dated 04.08.2018 passed in C.C.No.2456/2015 by the Judicial Magistrate First Class, II Court, Davanagere, whereunder the respondent - accused has been acquitted for offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as 'N.I. Act' for brevity). 2. The case of the appellant - complainant in brief, is as under: The appellant –complainant and respondent - accused are known to each other from several years. The respondent –accused had approached the appellant – complainant for financial assistance for marriage of his - 3 - NC: 2025:KHC:5895 CRL.A No. 1735 of 2018 sister and for his urgent family necessities on 12.09.2012. The appellant –complainant has advanced hand loan of Rs.1,70,000/- to the respondent –accused on 12.09.2012 and the respondent –accused has agreed to repay the said amount with interest at the rate of 2% within 06 months. The respondent –accused did not repay the amount borrowed. On 25.06.2013, the respondent –accused has issued cheque bearing No.595469 drawn on Karur Vysya Bank Ltd., Davanagere for Rs.1,70,000/- for repayment of the said hand loan. The appellant –complainant presented the said cheque for encashment and the said cheque was retuned with an endorsement stating “Funds Insufficient” in the account of the respondent -accused. The appellant - complainant got issued legal notice on 03.07.2013. Inspite of service of legal notice the respondent –accused did not pay the cheque amount. Therefore, the complainant has filed a private complaint against the respondent - accused for offence punishable under Section 138 of the NI Act. - 4 - NC: 2025:KHC:5895 CRL.A No. 1735 of 2018 3. Learned Magistrate has taken cognizance against the respondent –accused and registered case in C.C.No.2456/2015 for offence punishable under Section 138 of the N.I Act. The plea of respondent - accused has been recorded. The complainant in order to prove his case has examined himself as P.W.1 and got marked documents as Ex.P1 to P5. The appellant –complainant has also examined one witness as P.W.2. The statement of respondent -accused came to be recorded under Section 313 of Cr.P.C. Learned Magistrate after hearing arguments on both sides has formulated points for consideration and passed impugned judgment of acquittal. The said judgment of acquittal has been challenged by the complainant in this appeal. 4. Heard learned counsel for the appellant and learned counsel for the respondent. 5. Learned counsel for the appellant would contend that the respondent –accused has admitted his signature on Ex.P1 –cheque and therefore, the presumption under Section 139 of the N.I Act has to be - 5 - NC: 2025:KHC:5895 CRL.A No. 1735 of 2018 drawn. The said presumption has not been rebutted by the respondent –accused. The respondent –accused has not issued any reply to the legal notice got issued by the appellant –complainant and not filed any police complaint against the appellant –complainant for misusing of his cheque. On that point she placed reliance on the decision of the Co-Ordinate Bench of this Court in the case of A.M Harish Gowda @ A M Harisha Vs Sri Chaluvaraju H S1. She further submits that the presumption drawn under Section 139 of N.I Act is that the holder of the cheque received for the discharging of debt or any liability and if contrary is not proved, the accused has to be convicted for offence punishable under Section 138 of the N.I Act and on that point she placed reliance on the decision of the Hon’ble Apex Court in the case of P. Rasiya Vs Abdul Nazer2. She further submits that there is no rule to calculate interest even after it is agreed by parties. On that point she placed reliance on the decision 1 In Crl.P.No.619 of 2021 dated 04.06.2024 2 Reported in AIR OnLine 2022 SC 1373 - 6 - NC: 2025:KHC:5895 CRL.A No. 1735 of 2018 of the Co-Ordinate Bench of this Court in the case of Gajanan Kallappa Kadolkar Vs Appasaheb Siddamallappa Kaveri3. Without considering all these aspects, learned Magistrate has harped upon regarding no calculation of interest and hereby acquitting the respondent –accused for offence punishable under Section 138 of the N.I Act. With these, she prayed to allow the appeal and convict the respondent –accused for offence punishable under Section 138 of the N.I Act. 6. Learned counsel for the respondent –accused would contend that P.W.1 in his cross examination has admitted that accused has borrowed money form him in the year 2011 and he has repaid the same. The defence of the respondent –accused that the cheque has been issued as security when he borrowed money form the appellant –complainant in the year 2011 has been established as there is alteration in the contents of the cheque with regard to date and amount in figures. Considering the said aspect, the presumption drawn under 3 Reported in 2022 LiveLaw (KAR) 483 - 7 - NC: 2025:KHC:5895 CRL.A No. 1735 of 2018 Section 139 of N.I Act is rebutted. The appellant – complainant has not established the said lending. P.W.2 - Kasim Sab is a close friend of the P.W.1 and his evidence cannot be relied upon to establish that there is alleged lending. The appellant –complainant has not produced any materials to show his capacity to lend Rs.1,70,000/-. Considering all these aspects, the acquittal of the respondent –accused is proper and correct. With these, he prays for dismissal of the appeal. 7. Having heard learned counsels, the Court has perused the impugned judgment and trial Court records. Considering the grounds urged, the point arises for my consideration is “Whether learned Magistrate has erred in passing the judgment of acquittal of respondent –accused for offence punishable under Section 138 of N.I. Act.”? My answer to the above point is in the negative for the following reasons. - 8 - NC: 2025:KHC:5895 CRL.A No. 1735 of 2018 It is specific case of the appellant –complainant that the respondent –accused has sought hand loan on 12.09.2012 and he lent Rs.1,70,000/- on the same date by cash and period of the repayment is 06 months. The said borrowing is for marriage of sister of the respondent – accused. It is further case of the compliant that on 25.06.2013, the respondent –accused has issued cheque dated 26.06.2013 for Rs.1,70,000/- and it has been dishonoured for want of funds. The respondent –accused has admitted his signature on Ex.P1 –cheque. As the respondent –accused has admitted his signature on Ex.P1 –cheque, the presumption has to be drawn under Section 139 of the N.I Act that the cheque has been issued for discharge of debt. The said presumption is rebuttable presumption. The standard of proof for rebutting the said presumption is preponderance of probability. 8. It is specific defence of the respondent – accused that he has borrowed the money from the appellant –complainant during the year 2011 and at that time he had issued blank signed cheque to the - 9 - NC: 2025:KHC:5895 CRL.A No. 1735 of 2018 complainant. He has repaid said amount borrowed to the complainant. P.W.1 in his cross examination has admitted that the accused has borrowed money from him in the year 2011 and he has repaid the said amount. P.W.1 has denied the suggestion that during the year 2011 for the said transaction has received the cheque as security. P.W.1 in his cross examination has admitted that the amount in words has been altered in the words as “Seventy”. P.W.1 has denied the suggestion that numerical three in the date of the cheque has been altered. On close scrutiny of the said date of the cheque by using magniying glass it is seen that the year 2011 has been altered and over written as year 2013. The last numerical one has been altered as numerical three. The very said fact probablise the defence of the respondent – accused that signed cheque has been given by the respondent –accused to the complainant in the year 2011. Considering the said aspect, the respondent –accused has rebutted the presumption drawn under Section 139 of the N.I. Act. As presumption is rebutted it is for the - 10 - NC: 2025:KHC:5895 CRL.A No. 1735 of 2018 complainant to establish that the said lending and issuance of cheque for discharge of the debt. P.W.2 is stated to be witness to the transaction of the lending by the appellant – complainant to the respondent –accused. P.W.2 in his evidence stated that the transaction has taken in his presence on 12.09.2012. In the cross examination P.W.2 has admitted that he is acquainted with the complainant since 18 years and he is doing business of dealing in old vehicles with the appellant –complainant since last 18 years. P.W.2 has denied the suggestion that the appellant –complainant will do transactions in his presence. Considering the said aspect, P.W.2 is an interested witness and his evidence cannot be relied. 9. The alleged request by the respondent – accused for hand loan is on 12.09.2012 and alleged lending of Rs.1,70,000/- by cash by the appellant – complainant to the respondent –accused is on the same day i.e. 12.09.2012. What was the source of the said amount of Rs.1,70,000/- by cash by the complainant is not explained. Considering all these aspects, the appellant - 11 - NC: 2025:KHC:5895 CRL.A No. 1735 of 2018 –complainant has failed to prove that the respondent – accused has borrowed Rs.1,70,000/- and issued Ex.P1 – cheque for discharging the said debt. Even though the acquittal by the trial Court is on different grounds, considering above aspect, the judgment of acquittal requires to be affirmed. There are no grounds for reversing the judgment of acquittal. 10. In the result, the appeal is dismissed. Sd/- (SHIVASHANKAR AMARANNAVAR) JUDGE DSP List No.: 1 Sl No.: 63