- 1 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 IN THE HIGH COURT OF KARNATAKA, KALABURAGI BENCH DATED THIS THE 17TH DAY OF SEPTEMBER, 2025 BEFORE THE HON'BLE MRS JUSTICE M G UMA CRIMINAL APPEAL NO. 200229 OF 2023 (378(Cr.PC)/419(BNSS)) C/W CRIMINAL APPEAL NO. 200271 OF 2023 IN CRL.A.NO.200229/2023: BETWEEN: RUPESH S/O BASAVARAJ WAGHMARE, AGE:39 YEARS, OCC: AGRICULTURE, R/O. GANGA COLONY, BASAVAKALYAN, TQ.BASAVAKALYAN, DIST. BIDAR-585327. …APPELLANT (BY SRI PRADEEP KUMAR, ADVOCATE) AND: SIDRAM S/O MALLIKARJUN NASE, AGE:36 YEARS, OCC: AGRICULTURE AND BUSINESS, R/O. VITHOBA GALLI, BASAVAKALYAN, TQ. BASAVAKALYAN, DIST. BIDAR-585 327. …RESPONDENT (BY SRI SACHIN M. MAHAJAN, ADVOCATE) Digitally signed by PRASHANTH N V Location: High Court of Karnataka - 2 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378 (4) OF CR.P.C PRAYING TO SET ASIDE THE JUDGEMENT AND ORDER OF THE ACQUITTAL DT.23.03.2023 PASSED BY THE CIVIL JUDGE AND JMFC AT BASAVAKALYAN IN C.C NO. 82/2021 AND CONVICT THE ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 138, 142 OF NEGOTIABLE INSTRUMENT ACT 1881. IN CRL.A.NO. 200271/2023: BETWEEN: RUPESH S/O BASAVARAJ WAGHMARE, AGE:39 YEARS, OCC: AGRICULTURE, R/O GANGA COLONY, BASAVAKALYAN, …APPELLANT (BY SRI PRADEEP KUMAR, ADVOCATE) AND: SIDRAM S/O MALLIKARJUN NASE, AGE:36 YEARS, OCC: AGRICULTURE AND BUSINESS, R/O VITHOBA GALLI, BASAVAKALYAN, …RESPONDENT (BY SRI SACHIN M. MAHAJAN, ADVOCATE) THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378 (4) OF CR.P.C PRAYING TO SET ASIDE THE JUDGMENT AND ORDER OF THE ACQUITTAL DT. 23.03.2023 PASSED BY THE CIVIL JUDGE AND JMFC AT BASAVAKALYAN IN C.C.NO.81/2021 AND CONVICT THE ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF NEGOTIABLE INSTRUMENT ACT 1881. - 3 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 THESE APPEALS, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MRS JUSTICE M G UMA ORAL JUDGMENT (PER: HON'BLE MRS JUSTICE M G UMA) The appellant in both cases being the complainant in C.C.Nos.82/2021 and 81/2021 on the file of the learned Civil Judge & JMFC Court, Basavakalyan [for short, ‘the Trial Court’], is impugning the judgment dated 23.03.2023 acquitting the respondent-accused for the offence punishable under Section 138 of Negotiable Instruments Act, 1881 [for short, ‘the N.I.Act’]. 2. Facts of the case in brief are that, the appellant -complainant in both these cases has filed the private complaint in P.C.Nos.18/2020 and 17/2020 against the respondent-accused alleging commission of the offence punishable under Section 138 of N.I. Act. It is the contention of the complainant that, he is a businessmen by profession and was having cordial relationship with respondent-accused. Since the respondent-accused was in - 4 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 need of money, he requested the complainant to pay hand loan of Rs.3,75,000/- and Rs.4,00,000/- on the same day. Accordingly, the complainant lent an amount of Rs.7,75,000/- on 10.05.2019. The accused promised to repay the same within six months. The complainant demanded back the amount after completion of six months. Finally the accused issued two cheques bearing Nos.316075 and 316074, dated 16.12.2019 for Rs.3,75,000/- and Rs.4,00,000/- respectively drawn on State Bank of India, Branch Basavakalyan, towards discharge of legally enforceable debt. When the said cheques were presented for encashment, the same were dishonored as there was insufficient fund in the account of the accused. 3. The legal notices were issued to the accused informing him regarding dishonor of the cheques and calling upon him to pay the cheque amount. The accused had not repaid the cheque amount nor did he reply to the legal notices and thereby he has committed the offence - 5 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 punishable under Section 138 of N.I. Act. Accordingly, the complainant filed two separate complaints and requested the Trial Court to take cognizance of the offence. 4. The Trial Court took cognizance of the offence and registered the cases in C.C.Nos.82/2021 and 81/2021. The accused has appeared before the Trial Court in both cases, pleaded not guilty and claimed to be tried. In order to prove his contention, the complainant in both cases examined himself as PW-1 and got marked Exs.P-1 to P-5. The accused has denied all the incriminating materials available on record, but has not led any evidence in support of his defence. The Trial Court, after taking into consideration all these materials on record, came to the conclusion that the complainant has not proved his financial capacity to lend an amount of Rs.3,75,000/- and Rs.4,00,000/- in both cases. Therefore, the accused is successful in rebutting the legal presumption under Sections 118 and 139 of N.I. Act. Accordingly, the impugned judgment of acquittal came to be passed. Being - 6 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 aggrieved by the same, the complainant in both cases is before this Court. 5. Heard Sri. Pradeep Kumar, learned counsel for the appellant and Sri. Sachin M.Mahajan, learned counsel for respondent. Perused the materials, including the Trial Court records. 6. In view of the rival contentions urged by the learned counsel for both the parties, the point that would arise for my consideration is: "Whether the judgment of the Trial Court acquitting the accused suffers from infirmities and calls for interference by this Court?" My answer to the above point is in the ‘Affirmative’ for the following: REASONS 7. It is the contention of the complainant that he is a businessmen and had lent Rs.7,75,000/- to the accused on 10.05.2019. Towards repayment of the same, the accused issued two cheques for Rs.3,75,000/- and - 7 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 Rs.4,00,000/- as per Ex.P1. When these cheques were presented for encashment, they were dishonored as there was insufficient fund in the account of the accused. Even though the legal notice was served, he had not repaid the cheque amount and thereby he has committed the offence under Section 138 of N.I. Act. 8. In order to prove his contention, the complainant examined himself as PW.1 in both cases. Ex.P1 is the cheque said to have issued by the accused. Ex.P2 is the bank endorsement for having dishonor the cheque for insufficient of funds. Ex.P3 is the copy of the legal notice in both the cases. Ex.P4-is the postal receipt. Ex.P5 is the postal acknowledgement of the accused for having served the legal notice. 9. During cross-examination of PW.1, it is admitted that the cheques Ex.P1 in both cases were pertaining to the bank account of the accused and the cheques bear signatures of the accused. It is suggested to PW.1 in both cases, that the accused was running B.C. - 8 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 business and the complainant is running Bamboo business. It is stated that, complainant being well acquainted with the accused had invested in B.C. business and as security, the accused had issued two cheques in question with his signatures. The same were misused by the complainant to file these cases. All these suggestions were denied by the witness. 10. It is the specific defence taken by the accused that, he had issued the cheque-Ex.P1 in both cases as security with his signature. However, he contends that, they were blank cheques. Even if such defence of the accused is to be admitted, that may not absolve the accused from his responsibility to pay the cheque amount on receipt of the legal notice. In this regard, I may refer to the decision of the Hon’ble Apex Court in Bir Singh Vs. Mukesh Kumar1, where the Hon’ble Apex Court referred to its various decisions on the subject and held in paragraph Nos.33, 34 and 36 as under: 1 (2019) 4 SCC 197 - 9 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 “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. 34. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence. 35. xxxxx 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.” - 10 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 11. The Hon’ble Apex Court again in APS Forex Services Pvt. Ltd. Vs. Shakti International Fashion Linkers and Others2, reiterated the settled position of law and rejected the defence taken by the accused that cheque in question was issued as security and he is not liable for conviction under Section 138 of the N.I. Act. 12. The Hon’ble Apex Court in M/s. Kalamani Tex and Another Vs. P Balasubramanian3, referring to its earlier decisions including its decision in Bir Singh (supra), reiterated the position of law that, issuance of blank cheque voluntarily singed and handed over by the accused which is towards some payment would attract the presumption under Section 139 of the N.I. Act, which includes the existence of legally enforceable debt. 2 AIR 2020 SC 945 3 (2021) 5 SCC 283 - 11 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 13. Thus, the position of law is very well settled that, unless the accused rebuts the legal presumption, he is not entitled for acquittal. 14. The accused has not stepped into the witness box to depose about misuse of the cheques. There is no explanation as to when those cheques were issued, whether any complaint was filed regarding such misuser, whether those cheques were demanded back, why no 'stop payment' instruction was issued to the bank manager. 15. The accused has not produced any material to probablise his contention that, he was running B.C. business or the complainant was investing in the said business or vise versa. The accused has not chosen to produce any material, nor has he examined any witness. The accused himself has not stepped into the witness box to depose about his defence. Under such circumstances, it cannot be said that, the accused is successful in rebutting the legal presumption. - 12 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 16. Since the accused has not rebutted the legal presumption, he is liable for conviction. 17. I have gone through the impugned judgment passed by the Trial Court, acquitting the accused for the offence punishable under Section 138 of the N.I. Act. The Trial Court proceeded to form an opinion that, putting bald suggestion to PW.1 by the learned counsel for the accused during cross examination amounts to rebutting the legal presumption, even though the witness denied all such suggestions. With such erroneous finding, the Trial Court proceeded to shift the burden on the complainant and formed an opinion that, the complainant has not proved lending of the amount. Unless the accused rebuts the legal presumption, the burden will not shift on the complainant either to prove lending of the amount or to prove the existence of legally enforceable debt, because the presumption under Section 139 of the N.I. Act includes the presumption regarding existence of legally enforceable debt. Therefore, I am of the opinion that, the Trial Court - 13 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 has committed an error in passing the impugned judgment and acquitting the accused without any basis. Hence, the same is liable to be set aside. 18. In view of the above, I answer the above point in the affirmative and proceed to pass the following: ORDER (i) Both the appeals are allowed. (ii) The impugned judgments of acquittal dated 23.03.2023 passed in C.C.Nos.82/2021 and 81/2021 respectively on the file of the learned Civil Judge and JMFC, Basavakalyan are hereby set aside. (iii) Consequently, the respondent-accused in both the cases is convicted for the offence punishable under Section 138 of N.I. Act and he is sentenced to pay fine of Rs.7,00,000/- [Rupees Seven Lakhs only] in Criminal Appeal No.200229/2023 and fine of Rs.6,00,000/- [Rupees Six Lakhs only] in Criminal Appeal No.200271/2023 within eight weeks from today. In default to pay - 14 - HC-KAR NC: 2025:KHC-K:5590 CRL.A No. 200229 of 2023 C/W CRL.A No. 200271 of 2023 fine, he shall undergo simple imprisonment for a period of nine months. (iv) Out of the fine amount to be paid by the accused, a sum of Rs.6,95,000/- in Crl.A No.200229/2023 and a sum of Rs.5,95,000/- in Crl.A. No.200271/2023 are ordered to be paid to the complainant- appellant as compensation under Section 357A of Cr.P.C. Registry is directed to send back the Trial Court records along with the copy of this judgment for information and needful action i.e., for issuance of the conviction warrant against the accused, if he fails to pay the fine amount within the time stipulated. SD/- (M G UMA) JUDGE MSR,LG List No.: 1 Sl No.: 0