- 1 - HC-KAR NC: 2026:KHC:20871 CRL.RP No. 1084 of 2018 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 16TH DAY OF APRIL, 2026 BEFORE THE HON'BLE MR. JUSTICE V SRISHANANDA CRIMINAL REVISION PETITION No.1084 OF 2018 (397(Cr.PC) / 438(BNSS) BETWEEN: 1. M/S RAPID SOCIETY AND CORPORATE SERVICES REPRESENTED BY ITS PROPRIETOR DEVARAJ T N S/O LATE NINGAPPA AGED ABOUT 40 YEARS NO.182 & 183, AMS COMPLEX, KATHRIGUPPE BAGALUR MAIN ROAD YELHANKA POST BANGALORE-560064 2. M/S RAPID SOCIETY AND CORPORATE SERVICES NO.182 & 183 AMS COMPLEX, KATHRIGUPPE BAGALUR MAIN ROAD YELHANKA POST BANGALORE-560064 REPRESENTED BY ITS PROPRIETOR DEVARAJ.T.N …PETITIONERS (BY SRI. VINEETH J. JAIN FOR SRI GOPAL SINGH, ADVOCATES) AND: INDIRA NAGAR CHIT FUNDS & TRADING COMPANY (PVT)LTD REGISTERED OFFICE AT:NO.258 INDIRANAGAR BANGALORE-560038 Digitally signed by R MANJUNATHA Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:20871 CRL.RP No. 1084 of 2018 REPRESENTED BY ITS RECOVERY INCHARGE CUM GPA HOLDER SRI B UMAKANTH …RESPONDENT (BY SRI C.KRISHNAPPA, ADVOCATE -ABSENT) THIS CRIMINAL REVISION PETITION IS FILED UNDER SECTION 397 R/W 401 CODE OF CRIMINAL PROCEDURE PRAYING TO SET ASIDE THE ORDER DATED 07.07.2018, IN CRL.APPEAL.NO.1498/2017, ON THE FILE OF THE LXVI ADDITIONAL CITYCIVIL AND SESSIONS JUDGE, BANGALORE CITY, (CCH:67), AS PER ANNEXURE A , AND ALSO TO SET ASIDE THE ORDERS DATED 26.09.2017 IN C.C.No.10052/2016 ON THE FILE OF THE XXVII ADDITIONAL CHIEF METROPOLITAN MAGISTRATE, BANGALORE, AS PER ANNEXURE-B AND TO ACQUIT THE PETITIONER OF THE CHARGE UNDER SECTION 138 OF NEGOTIABLE INSTRUMENT ACT. THIS PETITION, COMING ON FOR REPORTING SETTLEMENT, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE V SRISHANANDA ORAL ORDER Heard Sri Vineeth J. Jain, advocate for Sri Gopal Singh, learned counsel for the revision petitioners. None appears for the respondent. 2. Accused who suffered an order of conviction for the offence punishable under Section 138 of the Negotiable Instruments Act in C.C No.10052/2016 confirmed in Criminal Appeal No.1498/2017 is the Revision petitioner. - 3 - HC-KAR NC: 2026:KHC:20871 CRL.RP No. 1084 of 2018 3. Facts of the case which are utmost necessary for disposal of the present are as under: 3.1 A private complaint under Section 200 of the Code of Criminal Procedure alleging commission of an offence punishable under Section 138 of the Negotiable Instruments Act came to be filed contending that the petitioner/accused is the subscriber of a chit group bearing No.XRV Ticket No.8 for the value of Rs.25,00,000/- payable at the rate of Rs.62,500/- per month for a period of 40 months. 3.2 The accused was the highest bidder of the said chit in the auction held on 15.09.2012 by foregoing a sum of Rs.7,50,000/-. After receipt of the prized amount, accused became defaulter in payments of future installments of the chit. 3.3 After repeated requests and demands made by the complainant, accused issued a cheque bearing No.207988 dated 18.01.2016 in a sum of Rs.8,82,500/- drawn on State Bank of Mysore, Chamarajapete Branch, which on presentation got dishonored with an endorsement ‘account closed’. - 4 - HC-KAR NC: 2026:KHC:20871 CRL.RP No. 1084 of 2018 3.4 There was no compliance to the callings of notice. Therefore, action was sought against accused. 4. Learned Trial Magistrate after completing the necessary formalities, summoned the accused and recorded the plea. Accused pleaded not guilty. Therefore, trial was held. 5. In order to prove the case of the complainant, on behalf of the complainant Sri B.Umakanth was examined as PW-1 and placed on record 16 documents which were exhibited and marked as Exhibits P-1 to P-16 comprising of dishonoured cheque, bank endorsement, copy of the notice, postal receipt, postal acknowledgement, Order of the Deputy Registrar of Chits, Chit Agreement, Letter of Deputy Registrar of Chits, Commencement of the Chit Certificate, Form No.1, debit voucher, Chit amount payable slip, on demand promissory note executed by the accused, statement of account maintained by the complainant insofar as the chit for which the accused was due and the account copy. 6. As against the material evidence placed on record by the complainant, accused got examined himself as DW-1 and - 5 - HC-KAR NC: 2026:KHC:20871 CRL.RP No. 1084 of 2018 placed on record five documents which were exhibited and marked as Exhibits D-1 to D-5 which comprised of statement of accounts. 7. In the cross-examination of accused, he admits that he is a B.A. graduate and he is running a proprietary concern. He also admits that he was the subscriber of Chit Group No.XRV conducted by the complainant company and chit amount was to the tune of Rs.25,00,000/-. He also admits that monthly installment of Rs.62,500/- was required to be paid over a period of 40 months. 8. He further admits that, he has signed Exhibit P-6 which is the chit agreement dated 08.03.2012. He further admits that he got closed the account even before he issued the cheque in question. 9. However, accused denied that he was due in a sum of Rs.8,82,500/-. He further admits that against the alleged misuse of the cheque which was given as security at the time of entering into chit agreement, no police complaint is filed nor action is taken against the complainant. - 6 - HC-KAR NC: 2026:KHC:20871 CRL.RP No. 1084 of 2018 10. Based on the above material evidence on record, learned Trial Magistrate convicted the accused, noting that the defence evidence was not sufficient to rebut the presumption available to the complainant under Section 139 of the Negotiable Instruments Act. 11. Being aggrieved by the order of the learned Trial Magistrate, accused approached the First Appellate Court. 12. Learned Judge in the First Appellate Court, after securing the records, heard the arguments of the parties in detail and dismissed the appeal of the accused inter alia holding in paragraph Nos.10 and 11 as under: “10. The appellant has preferred the appeal on several grounds among them the prime ground is that the SPA holder of complainant who is designated as Foreman has no authority to file this complaint. Another contention taken by appellant is that the cheuqe in question is of the year 2012 but after a long time cheque has been presented on 18.1.2016 and complainant by misusing and misappropriating the documents of accused has foisted false case against the Appellant. One P.K. Chandrashekar Babu who is Managing Director of M/s Indiranagar Chit Funds and Trading Co. Pvt.Ltd. has authorized B. Umakanth - 7 - HC-KAR NC: 2026:KHC:20871 CRL.RP No. 1084 of 2018 working in his company to prosecute this case on behalf of Complainant. To evidence the same complainant produced and got marked SPA in Ex.P.1. Further produced cheque in question in Ex.P.2 and identified signature of accused in it. Memo issued by Banker for dishonor of cheque in Ex.P.3, legal notice in Ex.P.4, two postal receipts and acknowledgments marked as Ex.P.4 (a) to (d). Orders passed by joint Registrar of Chit Fund in Ex.P.5, Chit agreement in Ex.P.6, letter written to Foreman by Deputy Registrar of Chit Funds Southern Region, Bangalore District is produced and marked as Ex.P.7 and P.8. and such other documents pertaining to complaint is marked at Ex.P.9 to P.16. In all those documents the Managing Director of Chit Fund is mentioned as Foreman and hence, Managing Director has got power and authority to authorize and prosecute this complaint to his SPA holder. 11. Thereafter accused himself examined as DW1 and in his cross examination he clearly admitted that Ex.P.10 is written in his presence and Ex.P.9 belongs to him and it contains signature of Guarantor and Ex.P.9 form filled in his presence. He also admitted his signature in Ex.P.2 at P.2(a). He also clearly admitted that Ex.P.2 cheque dishonored as account closed. He also admitted that he has received notice as per Ex.P.4(c) and (d). Further he clearly admitted that he has not taken any civil or criminal action against the complainant for misusing and misappropriating cheque and other documents belonged to him. Under these - 8 - HC-KAR NC: 2026:KHC:20871 CRL.RP No. 1084 of 2018 circumstances, in the ordinary course of business transaction no prudent man will keep silence when any other person is infringing right of another. In this case DW1 clearly admitted that he is BA graduate such being the case inaction on the part of accused against the complainant clearly discloses that there is admission of liability from the side of accused towards complainant. Under these circumstances, adverse inference can be drawn under Section 114(g) of Evidence Act against the accused. Hence, viewing from any angle there is no reasonable grounds in to the Judgment of conviction and sentence passed by learned trial Judge. Accordingly, this court hold Point No.1 in the Negative.” 13. Being further aggrieved by the same, accused is before this Court in this revision petition. 14. Sri Vineeth J. Jain, learned counsel for the petitioner, reiterating the grounds urged in the revision petition would contend that both the Courts have not properly taken into consideration that accused was not due in a sum of Rs.8,82,500/-. Therefore, there was no legally recoverable debt covered under Exhibit P-1 which is a sine qua non for convicting the accused for the offence under Section 138 of the - 9 - HC-KAR NC: 2026:KHC:20871 CRL.RP No. 1084 of 2018 Negotiations Act and therefore, sought for allowing the revision petition. 15. In the light of the arguments put forth on behalf of the revision petitioner, this Court perused the material on record meticulously. 16. On such perusal of the material on record, it is crystal clear that the petitioner admitted that he was a subscriber of the chit group No.XRV ticket No.8. He also admits Exhibit P-6, chit agreement and Ex.P-13, on demand promissory note executed by him in favour of complainant. 17. It is the case of the accused that the cheque marked at Exhibit P-1 has been given as a security which has been misused by the complainant. 18. No normal prudent person would keep quiet if the cheque is misused by the complainant company without taking necessary action. Categorically, accused has admitted in his cross-examination that he did not chose to take action against the accused that too after engaging the services of an advocate. - 10 - HC-KAR NC: 2026:KHC:20871 CRL.RP No. 1084 of 2018 19. Therefore, this Court is of the considered opinion that the presumption raised in favour of the complainant having not been properly rebutted by the accused, conviction of the accused for the offence under Section 138 of the Negotiable Instruments Act confirmed by the First Appellate Court needs no interference, that too, in revisional jurisdiction. 20. Accordingly, the following: ORDER Revision petition is dismissed. Sd/- (V SRISHANANDA) JUDGE kcm List No.: 2 Sl No.: 51