IN 1l IL I IIGI I COURT oF KARNArAKA CIRCIJil’ BENCIl A I D}1 1 \RWAI) 1)AI’LD TillS TI IF I 5 H DAY OF OCTOI3LR OI I BE F0 RI TI IL I ION’Bl E MR. JLSi’lCI’ ANAND BYRARF1)i)Y CRIMINAL APPEAL N0M57i2006 13E1’\VEEN: Shree Mata Co-operati e Credit Society Limited. Shastri Nagar. New Goodshed Road. Belgaum, Represented by Its Assistant Sri .Ani I Ramachandra Kadam. Aaed about 35 years. 0cc: Ser ice. ...APPELLANT (I Shri, Ramachandra Mali, Advocate) AN [): N ingappa Laxman Pat ii, Age: Major. 0cc: Business. Rio 275, Ramdev Galli, Savaaon, Post:Mandol Ii. ‘I q : Belgaum. .. RI SP0N[)ENT (FL Shi i \nand K Na alaimath (io U nmcnt PleacLi This Criminal Appeal is filed tinder Section 378 of the Code of Criminal Procedure, 1973, seeking to set aside the judgment of acquittal dated 17.01.2006 in C.C.No.634.’2005 on the tile of the JMFC-ll court. l3elgaum. acquitting the respondent for the offence punishable under Section 138 of Negotiable Instrument Act. This appeal coming on for final hearing this day, the Court made the following: SUDS KS U 7 a S S e-e a a a Heard the counsel for the appellant. The respondent who has been sen’ed remains absent. 2. The brief facts of the case are that the appellant was the complainant before the trial court. It was case of the appellant that the respondent had availed of a loan of Rs.25.000/- on 25.11.1998 after complying with all the necessary fotmalities. When there was default in repayment of the loan, a demand was made by the appellant along with interest on the loan amount, in respect of which, the respondent had issued a cheque for a sum of Rs.45599/- which included not only the principal amount, but the interest that had accrued S 3 on the said loan amount. When the cheque. ‘which was issued by the respondent, was presented through the appellant’s banker, it was dishonoured with an endorsement that the account was closed. rnlereafter the appellant had issued a notice dated 27.1.2004, and it was returned as not claimed and it is in that background that the appellant had approached the court below with a complaint alleging an offence punishable under Section 138 of the Act. The matter was contested bePore the trial court. The trial court has dismissed the complaint on the ground that the loan was of the year 1998 and there was no demand or acknowledgement of debt in the meanwhile from 1988 to 2004. In the absence of which, the court was of the opinion that there was no legally recoverable debt subsisting as any suit for recovery of the loan amount was barred by time in the absence of acknowledgement of the debt and therefore, has negated the complaint of the appellant that in the absence of a legally enforceable debt, it could not be presumed that the cheque in question was issued in discharge of legally S 4 enforceable debt. In this regard, the court has placed reliance on a judgment of the Madras High Court reported in the case of Rajendra Finance vs. S.i1toxins Thairivanatharn. 2005 (2) DLR 226 and has reiterated that in die absence of any document to show that there was a demand between the dates of the loan transaction and the issuance ofthe cheque, there was no legally recoverable debt in existence and hence, has rejected the complaint. The court below has overlooked the glaring circumstance that the issuance of a cheque raises a presumption under Section 139 of the Act in favour of the holder of a cheque. Though this is a rebuttable presumption, the burden shifts on the accused to establish that there was no legally recoverable debt. The mere fact that the loan transaction was of the year 1998 and the cheque has been issued in the year 2004, by itself, would not render the transaction a nullity or that it cannot be characterised as not being a legally recoverable debt. The very issUance oI’the cheque is the acknowledgement of the debç. This aspçct of the matter seems to have been compleiely overlooked. i’he opinion of the court below that there should have been a demand and acknowledgement of the debt. is complied with, in there being a demand. Since there as a notice issued by the appellant and as a consequence of which. the ch&jue has been issued, by itself would demonstrate that there was an acknowledgement of debt. Hence, it is wholly immaterial that there is a time-lag between the date of the loan transaction and the issuance of the cheque. The court below having taken a view that a suit for recovery of the cheque amount was barred by time, is an unjust and unfair observation to the prejudice of the appellant. i’he law as laid down by the apex court in Rangappci vs. .l’fohciti. 2010 (31 .411? Kcir. 1? 33(1. is explicit that though the presumption under Section 139 of the Act is a rebuttable presumption. the burden would be on the accused. unless there is material on record produced by the complainant himself which could be relied upon to raise a doubt as to the existence of the loan transaction. There is no such circumstance in the present case on hand. The view of the $ 6 S 4 court below is therefore perverse and could not have been sustained. Accordingly. the appeal is allowed. The judgment of the court below is set aside. The appellant has established his case beyond all reasonable doubt Accordingly. the respondent is sentenced in terms of Section 255(2) of the Code of Criminal Procedure, 1973, lbr an offence punishable under Section 138 of the Act and shall pay a fine of ‘55.00W- of which, a sum of 30.000/- shall be paid as compensation to the appellant and the balance amount shall be retained by the State as tine. In default of payment of tine, the respondent shall undergo imprisonment for a period of six months. The amount shall he paid within a period of five weeks from the date of receipt of a copy of this order. JUDGE nv