- 1 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 12TH DAY OF MARCH, 2025 BEFORE THE HON'BLE MR. JUSTICE V.SRISHANANDA CRIMINAL REVISION PETITION NO.100033 OF 2024 (397(CR.PC)/438(BNSS)) BETWEEN: 1. MAHALAKSHMI TRADING COMPANY JEERAL KALGUDI CAMP, TQ. GANGAVATHI, DIST. KOPPAL-583227, THROUGH ITS PROPRIETOR, SMT.RATNA KUMARI KARATURI, W/O. CHANDRA MOHAN, AGE: 44 YEARS, OCC. PROPRIETOR OF MAHALAKSHMI TRADING COMPANY. 2. SRI CHANDRA MOHAN S/O. SUBBARAO, AGE: 49 YEARS, OCC. BUSINESS, C/O. MAHALAKSHMI TRADING COMPANY, BOTH ARE R/O. PANCHAYATH NO.91, JEERAL KALGUD CAMP, CHIKKADANAKANKAL, TQ. GANGAVATHII, DIST. KOPPAL-583227. …PETITIONERS (BY SRI GIRISH V. BHAT, ADVOCATE) AND: BAGODI TRADERS THROUGH ITS PROPRIETOR SRI BAGODI YALLAYYA S/O. NARAYANAPPA, V N BADIGER Digitally signed by V N BADIGER Date: 2025.03.24 15:31:23 +0530 - 2 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 AGE: 65 YEARS, OCC. BUSINESS AND PROPRIETOR, OF BAGODI TRADERS, C/O. SRI BAGODI TRADERS, R.G.ROAD, TQ. GANGAVATHI, DIST. KOPPAL-583227. …RESPONDENT (BY SRI HANUMESH M. DESAI, ADVOCATE FOR SRI NEELENDRA D. GUNDE, ADVOCATE) THIS CRIMINAL REVISION PETITION IS FILED U/S. 397 R/W. 401 OF CR.P.C., SEEKING TO ADMIT THE PETITION AND CALL FOR THE RECORDS AND ALLOW THE REVISION PETITION AND SET ASIDE THE IMPUGNED JUDGMENT PASSED BY THE LEARNED ADDL. DISTRICT AND SESSIONS JUDGE, KOPPAL SITTING AT GANGAVATHI IN CRL.APPEAL NO.17/2023 DATED 20.11.2023 DISMISSING THE APPEAL AND FURTHER BE PLEASED TO SET ASIDE THE JUDGMENT AND ORDER OF SENTENCE PASSED BY THE PRL.CIVIL JUDGE AND JMFC, GANGAVATHI DATED 19.10.2022 IN CC NO.207/2020, CONVICTING THE PETITIONERS FOR THE OFFENCE PUNISHABLE U/S. 138 OF N.I. ACT AND IMPOSING FINE OF RS.7,63,633/- IN DEFAULT TO PAY THE FINE AMOUNT, TO UNDERGO SIMPLE IMPRISONMENT FOR A PERIOD OF ONE YEAR AND ACQUIT THE PETITIONERS OF THE CHARGES LEVELED AGAINST HIM. THIS PETITION, COMING ON FOR FINAL HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: - 3 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 ORAL ORDER (PER: THE HON'BLE MR. JUSTICE V.SRISHANANDA) Heard Sri.Girish V. Bhat, learned counsel for the revision petitioners and Sri.Hanumesh M. Desai, learned counsel for Sri.Neelendra D. Gunde, for respondent. 2. Accused are the revision petitioners who suffered an order of conviction in C.C.No.207/2020 for the offence punishable under Section 138 of the Negotiable Instrument Act, 1881 (for short, ‘the N.I.Act’) and ordered to pay fine of Rs.7,63,633/- out of which sum of Rs.7,53,633/- is to be paid as compensation to the complainant and balance sum of Rs.10,000/- towards the defraying expenses of the State, which got confirmed in Crl.A.No.17/2023. 3. Facts in a nutshell for disposal of the revision petition are as under: - 4 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 A complaint came to be lodged under Section 200 of the Criminal Procedure code (for short, ‘the Cr.P.C’) alleging the commission of offence punishable under Section 138 of the N.I.Act, by contending that the complainant being the proprietor of Bagodi Traders, supplied the pesticide and alleged products to the accused who is his customer. Products were sold from 23.06.2017 to 20.07.2018, which is a running account as per the invoices. Total bill amount was to the tune of Rs.10,26,732.94/-. Accused had an opening balance before the said transaction to the tune of Rs.3,04,482.01/- . Thus, there was a total due in the account of the accused to the tune of Rs.13,31,214.95/- and accused had repaid sum of Rs.7,80,000/- and towards balance amount, he issued cheque bearing No.018727 dated 22.08.2019 in a sum of Rs.7,63,633/- which on presentation came to be dishonoured with an endorsement ‘Funds insufficient’. - 5 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 4. Legal notice came to be issued to the accused. Despite service of the legal notice, there was no reply nor compliance. Therefore, complainant sought for action against the accused. 5. Learned trial Magistrate after completing necessary formalities issued summons to the accused and on his appearance, recorded the plea. Accused pleaded not guilty, therefore, trial was held. 6. In order to bring home the guilt of the accused, complainant got examined himself as PW1 and placed on record 72 documents, which are exhibited and marked as Ex.P1 to P.72. 7. Detailed cross examination of the complainant by the accused did not yield any positive material so as to disbelieve the case of the prosecution, except for the fact that the accused is able to show that there was no agreement with regard to the rate of interest in the transactions entered into between the complainant and accused. - 6 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 8. Thereafter, learned trial Magistrate recorded the accused statement and accused has denied the incriminatory circumstances. 9. In order to rebut the presumption available to the complainant under Section 139 of NI Act, accused got examined himself as DW1. However, did not place on record any documents in support of his contentions. 10. Thereafter, learned trial Magistrate heard the arguments of the parties and on cumulative consideration of the oral and documentary evidence placed on record convicted the accused inter alia holding in paragraph Nos.13 to 14 as imposed fine of Rs.7,63,633/-and directed sum of Rs.6,53,633/- as the compensation and balance amount of Rs.10,000/- towards the defraying expenses of the State. 11. Being aggrieved by the same, accused filed an appeal before the District Court in Crl.A.No.17/2023. Learned Judge in the First Appellate Court took into consideration the appeal grounds and secured the records - 7 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 and heard the arguments of the parties in detail and dismissed the appeal of the accused. 12. Being further aggrieved by the same, accused is before this Court. 13. Learned counsel for the revision petitioner Sri.Girish V. Bhat reiterating the grounds urged in the revision petition contended that both the Courts have grossly erred in convicting the accused for the offence punishable under Section 138 of NI Act inasmuch as amount covered under the cheque was not the amount due to the complainant, as is admitted on behalf of the complainant. Therefore, the revision petition is to be allowed. 14. He would further contend that in the absence of any agreement clause with regard to the interest, filling up the cheque in a sum of Rs.7,63,633-00 as against the due of Rs.5,51,214.95 is per se has been lost sight of both the Courts and thus, sought for allowing the revision petition. - 8 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 15. Per contra, Sri.Hanumesh Desai, learned counsel appearing for Sri.Neelendra D.Gunde representing the complainant supports the impugned orders. 16. Having heard the arguments of both the sides in detail, this Court perused the material on record meticulously. 17. On such perusal of the material on record, it is crystal clear that there was a business transaction between the complainant and accused. According to the complainant, as against due of sum of Rs.13,31,214.95, the accused had made a payment of Rs.7,80,000/-. Balance towards the balance amount of Rs.5,51,214.95/-, accused agreed to pay the same within 90 days, otherwise interest was required to be charged at 21%. The said calculation of the interest worked out to Rs.2,12,409/-. Therefore, accused issued the cheque in a sum of Rs.7,63,633-00 on 15.08.2019. - 9 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 18. As such, the conviction of the accused for the offence under Section 138 of the NI Act is just and proper and sought for dismissal of the revision petition. 19. Having heard the arguments of both the sides, this Court perused the material on record meticulously. On such perusal of the material on record, the following points would arise for consideration: 1) Whether revision petitioner would make out a case that the impugned judgment passed by the trial judge and modified by the learned judge in the first appellate court is suffering from legal infirmity and perversity and thus calls for interference? 2) Whether the sentence needs modification? 3) What order? Regarding point Nos.1 and 2: 20. In the case on hand, the issuance of the cheques and signature of the accused persons on the said cheque is not in dispute. So also business transactions existed between the complainant and the accused is not in dispute. - 10 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 21. Running account maintained and the goods supplied are evidenced by placing of copy of the VAT registration certificate and tax invoices and ledger account. 22. Admittedly, the complainant has given reduction to the tune of Rs.7,80,000/- as against the total amount due in a sum of Rs.13,31,214.95/-. Even after giving reduction, sum of Rs.5,51,214.95/- was still due in the account of the accused. 23. The said amount was agreed to be paid within a period of 90 days but failure to make payment within 90 days, the balance amount carried out interest at 21% which worked out to Rs.2,12,409/-. When the same was brought to the notice of the accused, cheque dated 22.08.2019 came to be issued in a sum of Rs.7,63,633/- on 15.08.2019. Admittedly, cheque came to be dishonoured with an endorsement ‘Funds insufficient’. Legal notice was issued and there was no reply nor compliance. - 11 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 24. The Oral testimony of DW.1 did not improve the case of the prosecution and the same is dealt in detail in paragraph No.10 of the judgment of the trial Court which is culled out hereunder for ready reference: “10. DW-1 in his cross-examination deposed that he has not given complaint against complainant as complainant had demanded to purchase the pesticides from his company and not from Manjushree company. Further admitted that there is his company seal in Ex.P-9 to 38. Further deposed that he had given his one company seal to the complainant. Further admitted that he had paid total amount of Rs.7,80,000/- to the complainant. Counsel for complainant suggested that Ex.P-1 dt:22-08-2019 for Rs.7,63,333/- cheque is given to complainant for which DW-1 deposed that during the purchase of goods he have singed the cheque and given to complainant. Further admitted that he and accused No.2 have knowledge about the cheque transaction. Further admitted that the address shown in the Ex,P- 7 and 8 is his address and also admitted that the seal on Ex.P-7 & 8 is the seal of his company but further deposed that there is no signature on the said exhibits. Further admitted that the signature in Ex.P-1 is his signature.” - 12 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 25. It is pertinent to note that amount mentioned in the cheque is the amount recoverable from the accused is the presumption that is available to the complainant under Section 139 of NI Act. No doubt it is a rebuttable presumption. 26. In the case on hand, to rebut the presumption available to the complainant, first accused got himself examined as DW1. His oral testimony was not sufficient enough to rebut the presumption available to the complainant under Section 139 of the NI Act, as could be seen from the discussion made by the learned trial judge referred supra. 27. Admittedly, the cheque was dishonoured with an endorsement ’Funds insufficient’ and there was no reply to the calling of notice. 28. Therefore, following the dictum of the Hon’ble Apex Court in the case of Rajesh Jain Vs. Ajay Singh1, this Court is of the considered opinion that the conviction 1 (2023)13 SCR 788 - 13 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 order recorded by trial Magistrate and confirmed by First Appellate Court needs no interference that too in the revisional jurisdiction. 29. As against the cheque amount of Rs.7,63,633/-, trial judge has imposed the same amount as the fine amount and out of which sum of Rs.10,000/- ordered to be paid as defraying expenses of the State. In fact, complainant should have challenged inadequacy of the sentence. However, the complainant did not chose to do so. 30. Therefore in the revision petition filed in the accused, there cannot be any enhancement of the fine amount. Since, lis is privy to the parties and no State machinery is involved, awarding of Rs.10,000/- towards the defraying expenses of the State needs to be set aside and entire fine amount of Rs.7,63,633-00 is ordered to be paid as compensation to the complainant. 31. Accordingly, point No.1 is answered in the negative and point No.2 is answered partly negative. - 14 - NC: 2025:KHC-D:4723 CRL.RP No. 100033 of 2024 Regarding point No.3 32. In view of the findings of this Court on point Nos.1 and 2 as above, the following Order is passed:- ORDER (i) Criminal Revision Petition is allowed in part. (ii) While maintaining the conviction of the accused for the offence under Section 138 of NI Act, fine amount is ordered in a sum of Rs.7,63,633/- is to be paid as compensation to the complainant by setting aside the Rs.10,000/- imposed towards the defraying expenses of the State. (iii) Time is granted for the revision petitioners to pay the balance fine amount till 15.04.2025, failing which they shall undergo simple imprisonment for a period of six months. (iv) Office is directed to return the trial Court records with copy of this order forthwith. SD/- (V.SRISHANANDA) JUDGE AC - para 1 to 3 HMB- para 4 to end , CT:PA LIST NO.: 2 SL NO.: 50