- 1 - NC: 2025:KHC-D:6467 CRL.A No. 100007 of 2017 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 16TH DAY OF APRIL 2025 BEFORE THE HON'BLE MR. JUSTICE SHIVASHANKAR AMARANNAVAR CRIMINAL APPEAL NO.100007 OF 2017 BETWEEN: SRI. R. MARUTI PRASAD S/O. GOVINDAPPA, AGE: 39 YEARS, OCC: BUSINESS, R/O: M.G. ROAD, GANGAVATHI, DIST: KOPPAL. …APPELLANT (BY SRI. A. M. GUNDAWADE, ADVOCATE) AND: NAGARAJ GUPTA S/O. MANGALESH GUPTA, AGE: 39 YEARS, OCC: PROPRIETOR OF HARIHARESHWARA MEDICAL AND GENERAL STORE, M.G. ROAD, GANGAVATHI. …RESPONDENT (BY MISS. SHEBA A. KHANAPUR, ADVOCATE FOR SRI. SUNIL S. DESAI, ADVOCATE) THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378 (4) OF CODE OF CRIMINAL PROCEDURE, 1973 PRAYING TO CALL FOR THE RECORDS OF THE CASE BEARING CRIMINAL CASE NO. 203/2013, ON THE FILE OF PRINCIPAL CIVIL JUDGE AND JUDICIAL MAGISTRATE FIRST CLASS COURT, GANGAVATHI AND TO ALLOW THE PRESENT APPEAL BY SETTING ASIDE THE JUDGMENT OF ACQUITTAL DATED 08.11.2016, PASSED IN CRIMINAL CASE NO. 203/2013, BY PRINCIPAL CIVIL JUDGE AND JUDICIAL MAGISTRATE FIRST CLASS COURT, GANGAVATHI AND TO PASS A JUDGMENT OF CONVICTION AGAINST THE ACCUSED/RESPONDENT FOR THE OFFENCE PUNISHABLE UNDER SECTION 138 OF NEGOTIABLE INSTRUMENT ACT AND ALSO DIRECTING THE RESPONDENT TO PAY COMPENSATION TO THE COMPLAINANT INCLUDING THE HAND LOAN OF RS. 6,50,000/-IN ACCORDANCE WITH LAW ANY OTHER ORDERS Digitally signed by YASHAVANT NARAYANKAR Location: High Court of Karnataka, Dharwad Bench, Dharwad - 2 - NC: 2025:KHC-D:6467 CRL.A No. 100007 of 2017 MAY KINDLY BE PASSED THAT THE HON’BLE COURT DEEMS FIT IN THE INTEREST OF JUSTICE. THIS CRIMINAL APPEAL, COMING ON FOR FINAL HEARING THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: THE HON'BLE MR. JUSTICE SHIVASHANKAR AMARANNAVAR ORAL JUDGMENT This appeal is filed by appellant/complainant challenging the judgment of acquittal dated 08.11.2016 passed in C.C.No.203/2013 by the Prl. Civil Judge and JMFC, Gangavathi, whereunder, respondent/accused has been acquitted for offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as ‘138 of N.I. Act’, for short) . 2. The case of the appellant/complainant in brief is as under: The appellant/complainant and respondent/accused are well known to each other. That on 28.11.2012, the respondent/accused has obtained hand loan of Rs.6,50,000/- from the complainant for his family necessities and business purpose by promising to repay - 3 - NC: 2025:KHC-D:6467 CRL.A No. 100007 of 2017 the same on or before 20.02.2013. In order to repay the said loan, the respondent/accused has issued cheque- Ex.P-1 for Rs.6,50,000/- dated 20.02.2013 in favour of the complainant. The complainant presented the said cheque and it came to be dishonoured with an endorsement “Funds Insufficient” in the account of the accused. The complainant has got issued legal notice on 04.03.2013 and it has been served on the respondent/accused on 05.03.2013. The accused did not pay the cheque amount. Therefore, the complainant has filed a private complaint against the respondent/accused for offence under Section 138 of N.I. Act. 3. Learned Magistrate has taken cognizance and registered case in C.C.No.203/2013 against the respondent/accused for offence under Section 138 of N.I. Act. The plea of the accused has been recorded. The complainant in order to prove his case has examined himself as PW-1 and got marked documents as Exs.P-1 to P-6. The statement of the accused has been recorded - 4 - NC: 2025:KHC-D:6467 CRL.A No. 100007 of 2017 under Section 313 of Cr.P.C. The accused has filed his statement in writing and produced seven documents. The accused has not led defence evidence. 4. The learned Magistrate after hearing the arguments on both sides, has formulated the points for consideration and passed the impugned judgment of acquittal. The said judgment of acquittal has been challenged by the complainant in this appeal. 5. Heard learned counsels for appellant and respondent. 6. Learned counsel for appellant would contend that the signature on the cheque-Ex.P-1 has been admitted and therefore, presumption has to be drawn under Section 139 of N.I. Act. The said presumption has not been rebutted by the respondent/accused. The respondent/accused has not sent any reply to the legal notice and not led any defence evidence. Without considering these aspects, the learned Magistrate has - 5 - NC: 2025:KHC-D:6467 CRL.A No. 100007 of 2017 erred in passing impugned judgment of acquittal. With this, he prayed for allowing the appeal and convicting the respondent/accused for offence under Section 138 of N.I. Act. 7. Learned counsel for respondent would contend that the appellant/complainant has not produced any documents to show that respondent/accused has availed hand loan from the complainant. The appellant/complainant has stopped his money lending business in the year 2009. The appellant has not produced any documents to show his capacity to lend huge amount of Rs.6,50,000/-. The writing on the cheque-Ex.P-1 and ink used for said writing and ink used for signature differs. The respondent/accused has taken up the defence that the two cheques have been issued as a security for earlier loan transaction and they have been misused even inspite of repayment of the amount borrowed. Considering all these aspects, learned Magistrate has rightly acquitted - 6 - NC: 2025:KHC-D:6467 CRL.A No. 100007 of 2017 respondent/accused. With this, she prayed for dismissal of the appeal. 8. Having heard learned counsels, the Court has perused the impugned judgment and trial Court records. 9. Considering grounds urged, the following point arises for consideration: i. Whether the trial Court has erred in acquitting the respondent/accused for offence under Section 138 of N.I. Act? 10. My answer to the above point is in ‘negative’ for the following reasons. 11. It is the specific case of the appellant/complainant that respondent/accused has borrowed Rs.6,50,000/- on 28.11.2012 agreeing to repay the same within three months and thereafter, issued cheque-Ex.P-1 dated 20.02.2013 for Rs.6,50,000/- in order to repay the amount borrowed and the same has been dishonoured for want of funds in the account of - 7 - NC: 2025:KHC-D:6467 CRL.A No. 100007 of 2017 respondent/accused. The respondent/accused has admitted his signature on cheque-Ex.P-1 and therefore, presumption has to be drawn under Section 139 of N.I. Act. The said presumption is a rebuttable presumption. The standard of proof for rebutting the said presumption is preponderance of probability. 12. It is the defence of the respondent/accused that earlier he had borrowed money from the appellant/complainant and at that time, he had given two blank signed cheques as a security. He has further taken up the defence that he has repaid the said amount borrowed and the cheques with the complainant have been misused by the complainant and one Pampanna- clerk in the medical shop of his brother. Even though PW-1 has denied the suggestions that respondent/accused has borrowed Rs.2,00,000/- on 25.06.2011, Rs.85,000/- on 29.06.2011, Rs.1,00,000/- on 11.07.2011 and Rs.2,00,000/- on 18.07.2011 and Rs.1,15,000/- on 20.08.2011. PW-1 has admitted that he has received - 8 - NC: 2025:KHC-D:6467 CRL.A No. 100007 of 2017 Rs.2,50,000/- from the accused on 13.02.2012. The complainant/PW-1 has not explained when he has denied the borrowing of the amount by the accused and for what purpose he has received Rs.2,50,000/- from the accused. The said admission given by PW-1 in his cross- examination itself indicates that accused had borrowed earlier from the complainant and he has repaid the amount borrowed. 13. On perusal of the writing in cheque-Ex.P-1, the ink used for writing date, name, amount in words and figures are different than the ink used for signature of the drawer. Even though PW-1 has denied that Pampanna has filed a cheque bounce case against the respondent/accused, but the documents produced along with statement of the accused at the time of recording Section 313 of Cr.P.C will show that Pampanna has filed cheque bounce case against the respondent/accused and the cheque number is 112712. The cheque number in the case on hand is 112713. The said two cheques are having - 9 - NC: 2025:KHC-D:6467 CRL.A No. 100007 of 2017 consecutive numbers. Considering the said aspects, it is clear that the respondent/accused has rebutted the presumption drawn under Section 139 of N.I. Act. When the presumption is rebutted, it is for the appellant/complainant to establish the transaction of borrowing. In order to establish the said borrowing except the cheque-Ex.P-1, no other materials placed on record. Considering all these aspects, the learned Magistrate has rightly acquitted the respondent/accused for offence under Section 138 of N.I. Act by a reasoned judgment. There are no grounds made out for interfering with the said judgment of acquittal passed by the trial Court. 14. In the result, the appeal is dismissed. Sd/- (SHIVASHANKAR AMARANNAVAR) JUDGE RKM CT-ASC List No.: 1 Sl No.: 33