1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 11TH DAY OF SEPTEMBER, 2025 BEFORE THE HON’BLE MR. JUSTICE SACHIN SHANKAR MAGADUM CRIMINAL PETITION NO. 6739 OF 2025 BETWEEN: MR. SHARANA BASAPPA .H.M S/O SRI. H.M. MARALU SIDDAPPA AGED ABOUT 49 YEARS R/AT FLAT NO 404 SRI SAI BLESS APARTMENT 3RD FLOOR, 4TH MAIN, 5TH CROSS BHOOPASANDRA, MLA LAYOUT BENGALURU-560 094. ...PETITIONER (BY SRI. BALARAM .M.L, ADVOCATE) AND: M/S CAPITAL 4 CONSTRUCTIONS PARTNERSHIP FIRM OFFICE AT NO 102, 2ND PHASE 2ND MAIN, VINAYAKA LAYOUT VIJAYANAGAR, BENGALURU-560 004. …RESPONDENT (BY SRI. AJIT .P.B, ADVOCATE) THIS PETITION IS FILED U/S 482 CR.PC (FILED U/S 528 BNSS) PRAYING TO SET ASIDE THE ORDER DATED 20.03.2025 PASSED BY LEARNED SESSIONS JUDGE AT LIX ACC AND SJ AT 2 BENGALURU IN AN APPLICATION FILED U/S. 311 R/W S.386(1)(b) OF CR.P.C. PRODUCED AS ANENXURE-A AND ETC. THIS PETITION HAVING BEEN HEARD AND RESERVED FOR ORDERS ON 14.08.2025, THIS DAY ORDER WAS PRONOUNCED THEREIN, AS UNDER: CORAM: HON’BLE MR. JUSTICE SACHIN SHANKAR MAGADUM C.A.V. ORDER The petitioner herein is aggrieved by the order of the appellate Court passed on an application filed under Section 311 read with Section 386(1)(b) and Section 391 of Cr.P.C. 2. The undisputed factual matrix leading to the present proceedings is that the respondent/complainant initiated a private complaint under Section 200 of the Code of Criminal Procedure, 1973, against the present petitioner/accused for the alleged commission of an offence punishable under Section 138 of the Negotiable Instruments Act, 1881. The gist of the complaint is that the accused, having received substantial funds from the complainant towards a business transaction, failed to honour the cheque 3 issued in discharge of the said liability, which, upon presentation, was returned unpaid. 3. The petitioner, while not disputing the factum of transaction in its entirety, has seriously contested the complainant’s assertion regarding payment of Rs.14,00,000/- in cash on 22.12.2016. The petitioner’s primary defence, both at the trial and in the appellate stage, is predicated upon the Gazette Notification dated 08.11.2016 issued by the Government of India demonetising the then existing Rs.500/- and Rs.1,000/- currency notes. According to the petitioner, such a payment in cash on the said date was legally and practically untenable in view of the demonetisation policy then in force. 4. Aggrieved by the judgment of conviction rendered by the learned Magistrate, the petitioner preferred an appeal before the learned Sessions Judge. During the 4 pendency of the appeal, the petitioner moved an application under Section 311 of the Cr.P.C. seeking to summon the Officer-in-Charge, Currency Management, Central Office, Reserve Bank of India, Mumbai, for the purpose of obtaining official information regarding the status of demonetised bank notes post 08.11.2016. The petitioner contended that such evidence was necessary to substantiate his defence that the complainant could not have made the alleged cash payment of Rs.14,00,000/- on 22.12.2016. 5. The appellate Court, upon consideration, rejected the said application, observing that the power under Section 311 Cr.P.C. is not to be exercised in a routine manner, and that such indulgence would be granted only upon a clear showing of exceptional circumstances and necessity for a just decision. The learned Sessions Judge further noticed that the petitioner had earlier made a 5 similar attempt by filing an application under Section 91 Cr.P.C., which too did not find favour with the Court. 6. I have heard the learned counsel for the petitioner/accused as well as the learned counsel representing the respondent/complainant at length and have perused the material on record. 7. The complaint under Section 200 Cr.P.C. reveals that the respondent/complainant had allegedly invested a total sum of Rs.30,00,000/- with the petitioner, who was engaged in the business of civil contracts. Out of the said amount, a sum of Rs.16,00,000/- was transferred through RTGS on different dates, and a further sum of Rs.14,00,000/- was allegedly paid in cash on 22.12.2016. It is the complainant’s categorical case that the petitioner issued a written acknowledgment on the said date, and in discharge of the liability arising therefrom, issued a cheque, which on presentation was dishonoured. The learned trial 6 Magistrate, upon appreciation of evidence, recorded a finding of guilt against the petitioner under Section 138 of the NI Act. 8. The thrust of the petitioner’s case is that the alleged cash payment of Rs.14,00,000/- is fictitious and contrary to the demonetisation regime in force at the relevant time. According to him, the evidence sought from the Reserve Bank of India would demonstrate the impossibility of such a payment in the denominations of Rs.500/- and Rs.1,000/-, thereby rebutting the statutory presumption under Section 139 of the NI Act. 9. At this stage, it becomes necessary to briefly recapitulate the legal position. Section 138 of the NI Act criminalises the dishonour of a cheque issued in discharge of a legally enforceable debt or liability. The provision is intended to promote the credibility of negotiable instruments and the efficacy of banking transactions. 7 Section 139 of the NI Act raises a presumption in favour of the holder of the cheque, including the presumption of existence of a legally enforceable debt or liability. Such a presumption is rebuttable, but the burden to do so squarely lies on the accused. Importantly, the scope of enquiry under Section 138 of NI Act does not extend to reopening the entire original transaction unless the defence is substantiated through cogent material. 10. Section 311 Cr.P.C. confers a discretionary power upon the Court to summon material witnesses or recall and re-examine any person if such evidence appears to be essential to the just decision of the case. However, this power is not unfettered and cannot be invoked casually or to fill up lacunae in the defence. In the present case, the records reveal that the petitioner had full opportunity to raise all defences during the trial, including the filing of an earlier application under Section 91 Cr.P.C., which was duly considered. 8 11. Once it is accepted that a cheque for Rs.22,00,000/- (Rupees Twenty-Two Lakhs) was issued and subsequently dishonoured, the necessity of summoning the Officer-in-Charge, Currency Management, Reserve Bank of India at the appellate stage is entirely misconceived and wholly unnecessary. The limited question for determination under Section 138 of the N.I.Act is whether the accused issued the cheque in question towards a legally enforceable debt or liability; it is not an enquiry into the exact mode or denominations by which the alleged antecedent payment was made. In the absence of specific and cogent evidence that the complainant paid the consideration in invalid denominations, any plea founded on “demonetisation” is irrelevant and particularly so at the appellate stage where the core statutory presumptions and burdens must be respected. 12. The foundation of liability under Section 138 of N.I. Act is the issuance of a cheque for consideration; it 9 does not require the complainant to re-prove the original transaction or the mode of payment in microscopic detail. Were Courts to insist that the complainant establish the original mode of payment or the physical denominations of currency tendered, the efficacy and purpose of Section 138 would be substantially undermined. The statutory scheme deliberately creates a legal fiction: upon proof of issuance and dishonour of the cheque, the Court is required to draw the presumption under Section 139 of N.I. Act, that the cheque was issued for a debt or liability. The accused must then rebut that presumption on the preponderance of probabilities; only thereafter does the evidentiary burden shift back to the complainant to establish that a legally enforceable debt existed at the time the cheque was issued. 13. In the present case, the accused does not deny the underlying transaction but disputes only the quantum. The complainant admits payment of Rs.16,00,000/- (Rupees Sixteen Lakhs) by RTGS, whereas the cheque 10 issued and dishonoured is for Rs.22,00,000/-. Crucially, the complainant has produced a receipt signed by the accused which acknowledges the debt and corresponds to the amount reflected in the cheque. These materials, namely the admitted issuance and dishonour of the cheque together with the accused’s signed receipt, engage the statutory presumption under Section 139 of N.I. Act and require the accused to come forward with credible, contemporaneous evidence to displace that presumption. In absence of such evidence, procedural detours such as summoning RBI officials or relying on speculative demonetisation arguments cannot be permitted to detract from the statutory framework and the decisive question as to whether the cheque was issued in discharge (wholly or partly) of a legally enforceable liability. 14. This Court, therefore, finds no infirmity or perversity in the order of the learned Sessions Judge rejecting the application under Section 311 Cr.P.C., which 11 in the facts and circumstances, appears to be an afterthought. 15. For the reasons stated supra, this Court proceeds to pass the following: ORDER The petition is dismissed. Sd/- (SACHIN SHANKAR MAGADUM) JUDGE ALB