- 1 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 25TH DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE K V ARAVIND CRIMINAL REVISION PETITION NO.100197 OF 2021 (397(Cr.PC)/438(BNSS)) BETWEEN: MUSTAK AHMAD S/O. SAYED AHAMAD HAVELI, AGE. 46 YEARS, OCC. BUSINESS, R/O. BHARAT AGRO INDUSTRY, VIJAYAPUR ROAD, TQ. JAMKHANDI, DIST. BAGALKOT. …PETITIONER (BY SRI VITTHAL S.TELI, ADVOCATE AND SRI YASH R.NADKARNI, ADVOCATE) AND: HUMAYUN S/O. DONGRISAB MIRJI, AGE. 59 YEARS, OCC. BUSINESS AND AGRI., TQ. JAMKHANDI, DIST. BAGALKOT. …RESPONDENT (BY SRI S.R. KAMATE, ADVOCATE) THIS CRIMINAL REVISION PETITION IS FILED UNDER SECTION 397 (3) R/W 401 OF CR.P.C., PRAYING TO SET ASIDE THE JUDGMENT DATED 27.07.2021 IN CRIMINAL APPEAL NO.3/2020 BY THE I ADDITIONAL DISTRICT AND SESSIONS JUDGE, BAGALKOT, SITTING AT JAMKHANDI WHEREIN CONFIRMED THE JUDGMENT DATED 06.12.2019 PASSED BY THE PRINCIPAL CIVIL JUDGE AND JMFC, JAMKHANDI IN CC NO.587/2015 FOR OFFENCE UNDER SECTION 138 OF N.I. ACT AND THEREBY ACQUIT THE PETITIONERS/ACCUSED AND ETC.,. Digitally signed by CHANDRASHEKAR LAXMAN KATTIMANI Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 THIS CRIMINAL REVISION PETITION, HAVING BEEN HEARD AND RESERVED ON 19.06.2025, COMING ON FOR ‘PRONOUNCEMENT OF ORDER’, THIS DAY, THE COURT PRONOUNCED THE FOLLOWING: CAV ORDER (PER: THE HON'BLE MR. JUSTICE K V ARAVIND) Heard Sri Vitthal S. Teli, learned counsel, appearing along with Sri Yash R. Nadkarni, learned counsel for the revision petitioner and Sri S.R. Kamate, learned counsel for the respondent. 2. This criminal revision petition is filed by the accused, assailing the judgment of conviction and order on sentence dated 06.12.2019 passed in C.C. No.587/2015 by the Principal Civil Judge and J.M.F.C., Jamkhandi (for short, ‘the trial Court’), and the judgment of conviction and order on sentence dated 27.07.2021 passed in Criminal Appeal No.3/2020 by the I Additional District and Sessions Judge, Bagalkot, sitting at Jamkhandi (for short, ‘the appellate Court’). - 3 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 3. The complainant is engaged in the business of wholesale medicines, while the accused is engaged in the business of manufacturing agricultural equipment under the name and style of 'Bharat Agro Industries'. The complainant and the accused are stated to be good friends. It is submitted that on 29.12.2014, the complainant advanced a sum of Rs.9,50,000/- in cash to the accused, in the presence of one Yunus Mohammadsab Mulla and one Tukaram Nandeppa Janawad, and the accused agreed to repay the said amount within a period of three months. 4. Thereafter, when the complainant approached the accused demanding repayment of the loan amount, the accused issued a cheque bearing No.115080 dated 03.02.2015, drawn on Axis Bank Ltd., Jamkhandi, in favour of the complainant for a sum of Rs.9,50,000/-. On the same day, the complainant presented the said cheque for encashment; however, it was dishonored and returned with the endorsement ‘Funds Insufficient’, as per the bank - 4 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 memo dated 09.02.2015. Subsequently, on 24.02.2015, the complainant issued a legal notice calling upon the accused to make payment of the cheque amount within fifteen days from the date of receipt of the notice. However, the notice was not claimed by the accused and was returned to the complainant on 25.02.2015 with the endorsement ‘not claimed’. 5. The complainant filed a private complaint under Section 200 of the Code of Criminal Procedure. The Court took cognizance of the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short, 'the N.I. Act'). The accused, upon appearance through his counsel, pleaded not guilty and sought to be tried. 6. In order to prove his case, the complainant filed his evidence by way of affidavit and examined himself as PW.1, and two others as PWs.2 and 3, who were cited as eyewitnesses. He also got marked 13 documents as Exhibits P1 to P13. The accused adduced defence evidence - 5 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 by examining himself as DW.1 and one other witness as DW.2, and marked 3 documents as Exhibits D1 to D3. The statement of the accused was recorded under Section 313 of Cr.P.C.. 7. The trial Court considering the oral and documentary evidence on record, convicted the accused for the offence punishable under Section 138 of the N.I. Act and sentenced him to pay a fine of Rs.9,55,000/-, and in default of payment of fine, undergo simple imprisonment for a period of one year. 8. Being aggrieved by the judgment of conviction and order on sentence passed by the trial Court, the accused preferred Criminal Appeal No.3/2020. The appellate Court, upon re-appreciation of the evidence on record, dismissed the appeal and confirmed the judgment of conviction and order of sentence passed by the trial Court. - 6 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 9. Learned counsel for the petitioner submits that the cheque in question was not issued towards repayment of any debt, as claimed by the complainant. It is contended that one Bandenawaz Budihal, who was employed by the petitioner and was also a close acquaintance of the complainant, misused his access to the petitioner’s cheque book by taking away signed blank cheques and handing them over to the complainant, who, in turn, misused the same. Learned counsel further submits that the presumption under Section 139 of the N.I. Act stands rebutted by the petitioner’s denial of liability, and therefore, the burden shifts onto the complainant to establish the existence of a legally enforceable debt, which he has failed to discharge. 9.1. It is pointed out that the complainant’s case is that a sum of Rs.9,50,000/- was advanced as a hand loan in cash, allegedly withdrawn from his bank account. However, the bank statements produced by the complainant indicate that there were neither any such - 7 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 withdrawals nor sufficient balance to extend such a loan to the petitioner. It is contended that both the trial Court and the appellate Court, without properly appreciating these aspects, proceeded to convict the petitioner merely by invoking the presumption under Section 139 of the N.I. Act. 10. Per contra, learned counsel for the respondent submits that the petitioner has admitted the issuance of the cheque and his signature thereon; hence, the presumption under Section 139 of the N.I. Act operates in favour of the complainant–respondent. It is contended that the mere denial of the alleged loan by the petitioner does not constitute a probable defence and is insufficient to rebut the statutory presumption. Learned counsel further submits that both the trial Court and the appellate Court have recorded concurrent findings by properly appreciating the evidence on record. Therefore, no interference is warranted with the impugned judgments. - 8 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 11. Considered the submissions of learned counsels for the parties and perused the record. 12. The case of the complainant is that the petitioner–accused approached him seeking financial assistance of Rs.10,00,000/- for business purposes. It is stated that, on 29.12.2014, the complainant paid a sum of Rs.9,50,000/- in cash in the presence of PWs.2 and 3, after withdrawing the said amount from his bank account. The petitioner, while admitting the cheque and his signature thereon, has disputed the underlying transaction and alleged that a signed blank cheque was misused by a common acquaintance who had access to the cheque book. The admission of issuance of cheque and signature thereon ordinarily attracts the presumption under Section 139 of the N.I. Act, which, however, is rebuttable. The question that now arises is whether the petitioner has successfully raised a probable defence. The complainant’s version is that the cash was withdrawn from the bank and handed over in the presence of PWs.2 and 3. In the face of - 9 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 a specific defence disputing the very transaction, a heavy burden lies upon the complainant to discharge the reverse burden and establish the transaction. However, the bank statements and passbook marked as Exhibits P6 to P13 do not support the case of the complainant. There are no withdrawals shown on the alleged date of the transaction. Furthermore, the complainant has failed to establish the availability of sufficient cash balance in his account to withdraw and advance the alleged hand loan of Rs.9,50,000/-. In the absence of such corroborative evidence, the testimony of PWs.2 and 3, who claim to have witnessed the transaction, cannot be accepted at face value and appears to be of little probative value, particularly when no independent evidence substantiates the version of the complainant. Thus, in the absence of credible evidence to establish that a cash loan of Rs.9,50,000/- was in fact advanced to the petitioner, it cannot be held that there existed a legally enforceable debt so as to attract the presumption under Section 139 of - 10 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 the N.I. Act. The trial Court, without appreciating these material aspects, committed an error in relying solely on the presumption under Section 139 of the N.I. Act. The appellate Court, in concurring with the findings of the trial Court, has also committed a similar error. 13. This Court, upon consideration of the evidence on record, is of the view that though the cheque and signature are admitted, in light of the petitioner–accused having disputed the entire loan transaction, the amount mentioned in the cheque cannot be held to represent a legally enforceable debt. The petitioner, by specifically contending that no amount was advanced to him and that his signed cheque was misused, has raised a probable defence, thereby shifting the burden onto the complainant. However, the complainant has failed to discharge this burden and establish that the amount mentioned in the cheque constitutes a legally enforceable debt. The complainant has not adduced any evidence to corroborate and prove the existence of debt. Considering the huge - 11 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 sum, the presence of entries in the books or other documents like Income tax return is a relevant document. 14. In the light of the above findings, the following: ORDER (i) The criminal revision petition is allowed. (ii) The judgment of conviction and order on sentence dated 06.12.2019 in C.C.No.587/2015 passed by the Principal Civil Judge and J.M.F.C., Jamkhandi and judgment of conviction and order of sentence in Criminal Appeal No.3/2020 dated 27.07.2021 passed by the I Additional District and Sessions Judge, Bagalkot, sitting at Jamkhani, are hereby set aside. (iii) The complaint against the accused- petitioner is rejected. The petitioner- accused is acquitted of the offences alleged in the complaint. (iv) The bail bonds and sureties if any, stands cancelled. - 12 - HC-KAR NC: 2025:KHC-D:9230 CRL.RP No. 100197 of 2021 (v) Fine amount if any deposited by the petitioner before the trial Court, shall be refunded in favour of the petitioner. Registry to return the trial Court records along with a copy of this order for compliance. Sd/- (K V ARAVIND) JUDGE DDU CT: UMD List No.: 1 Sl No.: 10