- 1 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 16TH DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE SHIVASHANKAR AMARANNAVAR CRIMINAL REVISION PETITION NO. 1581 OF 2016 BETWEEN: N. T. KANTHARAJU AGED ABOUT 56 YEARS S/O. THAMMAYYANNA, NAGATHIHALLI VILLAGE, KASABA HOBLI, TIPTUR TALUK, TUMAKURU -572 101. …PETITIONER (BY SMT. SHRUTHI, ADVOCATE FOR SRI. VINAYA KEERTHY M, ADVOCATE) AND: S. NAGRAJ AGED ABOUT 73 YEARS, S/O. R. SHAMANAIKA, KENGALAPURA VILLAGE, HANDANAKERE HOBLI, CHIKKANAYAKANAHALLI TALUK, TUMAKURU DISTRICT-582 101. (SINCE DEAD BY HIS LRS) (A) BOJA BAI AGED ABOUT 78 YEARS, W/O LATE S.NAGARAJU BHEEMANAYAKANA THANDYA, KENGALAPURA Digitally signed by LAKSHMINARAYANA MURTHY RAJASHRI Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 CHIKKANAYANAHALLI TALUK- 572 119. TUMAKURU DISTRICT. (B) TANUJA KRISHNA NAIK AGED ABOUT 60 YEARS, D/O LATE S.NAGARAJU, W/O H.B. KRISHNA NAIK, HARATHANAHALLI, KONDAVAGILU, ARSIKERE TALUK, HASSAN DIST- 573 103. (C) K.N. REKHA RANI AGED ABOUT 56 YEARS D/O LATE S.NAGARAJU W/O G.RAMESH KENGALAPURA THANDYA, KENGALAPURA POST, CHIKKANAYAKANAHALLI TALUK- 572 119 TUMAKURU DISTRICT. (D) K.N.ARUN KUMAR, AGED ABOUT 55 YEARS, S/O LATE S.NAGARAJU BHEEMANAYAKANA THANDYA, KENGALAPURA CHIKKANAYANAHALLI TALUK- 572 119 TUMAKURU DISTRICT. …RESPONDENTS (BY SRI. R.SHIVACHANDRA NAIK FOR LR'S) THIS CRIMINAL REVISION PETITION IS FILED UNDER SECTION 397 READ WITH SECTION 401 CR.P.C PRAYING TO SET ASIDE THE IMPUGNED JUDGMENT DATED 23.1.2015 PASSED BY THE PRL. C.J. AND J.M.F.C., TIPTUR IN C.C.NO.491/2012 FOR THE ALLEGED OFFENCES U/S 138 OF N.I.ACT AND ETC., - 3 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 THIS PETITION COMING ON FOR FINAL HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE SHIVASHANKAR AMARANNAVAR ORAL ORDER This revision petition is directed against the judgment dated 22.10.2016 passed in Crl.A.No.10008/2015 by V Additional District and Sessions Judge, Tiptur whereunder judgment of conviction dated 23.01.2015 passed in C.C.No.491/2012 by the Principal Civil Judge and JMFC, Tiptur convicting the petitioner- accused for offence punishable under Section 138 of Negotiable Instruments Act, 1881 (hereinafter referred to as ‘N.I. Act') and sentence of fine has been affirmed. 2. Heard learned counsel for the petitioner and learned counsel for the respondent. 3. The case of respondent-complainant before the trial Court was that, the petitioner-accused had barrowed a sum of Rs.1,50,000/- from the respondent-complainant - 4 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 on 01.05.2011 agreeing to repay the same within one month. Thereafter, the petitioner-accused has issued a cheque bearing No.606962 dated 01.06.2011 drawn on ING Vysya Bank, Tiptur branch for a sum of Rs.1,50,000/- for repayment of the amount borrowed. The complainant presented the said cheque for encashment and said cheque came to be dishonoured for a reason "account closed". The respondent-complainant issued a legal notice to the petitioner-accused on 02.09.2011 by registered post calling upon the petitioner-accused to repay the cheque amount within fifteen days. Inspite of service of notice, the petitioner-accused has not paid the cheque amount within fifteen days. Therefore, the respondent-complainant had initiated proceedings against the petitioner for the offence punishable under Section 138 of N.I Act. 4. The respondent - complainant has examined himself as PW1 and got marked documents as Ex.P1 to P5. Ex.D1 has been marked in cross-examination of PW1. The - 5 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 statement of the accused under Section 313 of Cr.P.C. has been recorded. The accused did not lead defence evidence. 5. Learned Magistrate after hearing arguments and appreciating the evidence on record, has convicted the petitioner-accused for the offence punishable under Section 138 of N.I Act and sentenced to pay fine of Rs.10,000/- and in default to undergo simple imprisonment for a period of six months and awarded payment of compensation of Rs.3,00,000/- under Section 357(3) of Cr.P.C. 6. The petitioner-accused challenged the said judgment of conviction and order of sentence before the Sessions Court in Crl.A.No.10008/2015 and the said appeal came to be dismissed on merits affirming the judgment of conviction, order of sentence and compensation. 7. Learned counsel for the petitioner would contend that, the petitioner has taken up defence that there was a - 6 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 chit transactions between the petitioner-accused and the wife of respondent-complainant and as a security the signed cheque was issued to her and that they have misused the same. He further submits that apart from imprisonment, double the amount of cheque has been ordered to be paid as compensation. With these, she prays to allow this revision petition. 8. Learned counsel for the respondent - complainant would contend that, the issuance of cheque and signature on cheque has been admitted by the petitioner-accused. Therefore, presumption has to be drawn under Section 139 of the N.I Act that the cheque is issued for discharge of debt. The petitioner-accused has not rebutted the said presumption. The defence set up by the petitioner has not been established. A mere typographical error in the legal notice at Ex.D.1 with regard to amount demanded will not rebut the presumption. The entire contents of Ex.D1-notice are required to be seen, with regard to demand of amount under the said notice. After - 7 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 considering all these aspects the learned Magistrate has rightly convicted the petitioner and the Appellate Court has rightly re-appreciated the evidence on record and dismissed the appeal. 9. Having heard the learned counsel for the parties, perused the impugned judgments and trial Court records. 10. It is a specific case of the respondent- complainant that the petitioner-accused had borrowed a sum of Rs.1,50,000/- on 01.05.2011 and he agreed to repay the said amount. In order to repay the said amount, the petitioner has issued a cheque and it came to be dishonoured. The petitioner has admitted his signature in the cheque at Ex.P.1. As the signature on the cheque is admitted, a presumption has to be drawn under Section 139 of the N.I Act that the cheque is issued for discharge of the debt. The said presumption is a rebuttable presumption. The standard of proof for rebutting the presumption is that of preponderance of probabilities. - 8 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 11. The petitioner-accused despite of service of legal notice as per Ex.P4 has not issued any reply to the said notice. The defence has been taken in the cross- examination of PW1. In the cross examination of PW1, it is suggested to him that petitioner-accused has given four blank cheques for money transaction on the same day. The said suggestion has been denied by PW.1. There are no other evidence brought on record to establish the said defence. Therefore, the presumption drawn under Section 139 of the N.I. Act that the cheque is issued for discharge of the debt is remained un-rebutted. To the consequences of non-rebuttal of the presumption has been considered by the Hon'ble Apex Court in the case of Rajesh Jain Vs. Ajay Singh reported in AIR Online 2023 SC 807 has held as under: “55. As rightly contended by the appellant, there is a fundamental flaw in the way both the Courts below have proceeded to appreciate the evidence on record. Once the presumption under Section 139 was given effect to, the Courts ought to have proceeded on the premise that the cheque was, indeed, issued in discharge of a debt/liability. The - 9 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 entire focus would then necessarily have to shift on the case set up by the accused, since the activation of the presumption has the effect of shifting the evidential burden on the accused. The nature of inquiry would then be to see whether the accused has discharged his onus of rebutting the presumption. If he fails to do so, the Court can straightaway proceed to convict him, subject to satisfaction of the other ingredients of Section 138. If the Court finds that the evidential burden placed on the accused has been discharged, the complainant would be expected to prove the said fact independently, without taking aid of the presumption. The Court would then take an overall view based on the evidence on record and decide accordingly.” 12. Ex.P4 is a copy of legal notice issued by the respondent-complainant to the petitioner-accused. The petitioner-accused has confronted the original of the said notice in the cross examination of PW.1 and it is marked as Ex.D1. The amount demanded in the said Ex.D1 is stated to be the cheque amount. At paragraph No.1, there is a specific mention that the amount of the cheque is Rs.1,50,000/-, what is demanded under Ex.D1 is the cheque amount. The amount demanded in a sum of Rs.4,000/- appears to be typographical error. The said aspect will not help the petitioner-accused in escaping with - 10 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 his liability. It is not the case of the petitioner-accused that he had paid Rs.4,000/- as demanded in Ex.D1 and that he is not liable for offence under Section 138 of the N.I. Act. 13. The trial Court apart from imposing sentence of simple imprisonment for a term of six months, has also ordered payment of fine of Rs.10,000/- and compensation of Rs.3,00,000/- which is double the cheque amount. The purpose of punishment for the offence under Section 138 of Negotiable Instruments Act is to see that the cheques are honored and the drawee will get the cheque amount and compensation. Therefore, the sentence of imprisonment as ordered by the Trial Court affirmed by the Appellate Court requires to be set-aside, maintaining fine and compensation amount. 14. The learned Sessions Judge re-appreciated the evidence on record and has rightly confirmed the judgment of conviction passed by the Trial Court. The trial - 11 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 Court apart from imposing sentence of simple imprisonment for a term of six months, has also ordered payment of fine amount of Rs.10,000/- and compensation of Rs.3,00,000/- which is double the cheque amount. The purpose of offence punishable under Section 138 of Negotiable Instruments Act is to see that the cheques are honoured and the drawee gets the cheque amount and compensation. Therefore, the sentence of imprisonment as ordered by the Trial Court affirmed by the Appellate Court requires to be set-aside, maintaining fine and compensation amount. 15. Therefore, the following: ORDER (i) This Criminal Revision Petition is allowed in part. (ii) The conviction of the petitioner-accused for offence punishable under Section 138 of Negotiable Instruments Act, as passed in - 12 - HC-KAR NC: 2025:KHC:26328 CRL.RP No. 1581 of 2016 C.C.No.491/2012, dated 23.01.2015 by the Principal Civil Judge and JMFC, Tiptur and confirmed by the judgment dated 22.10.2016 passed in Crl.A.No.10008/2015 by V Additional District and Sessions Judge, Tiptur, is hereby affirmed. (iii) The sentence of imprisonment is hereby set-aside. (iv) The order of sentence with regard to payment of fine of Rs.10,000/- and compensation of Rs.3,00,000/- and in default sentence are remained unaltered. (v) If the petitioner-accused fails to pay the compensation of Rs.3,00,000/-, he has to undergo simple imprisonment for six months. Sd/- (SHIVASHANKAR AMARANNAVAR) JUDGE RL List No.: 1 Sl No.: 23