The companyplainant presented the cheque on 19.8.2005 for encashment to his banker and it was dishonored with an endorsement fund insufficient and the companyplainant issued legal numberice on 12.9.2005 demanding repayment within 15 days from the date of its receipt thereof and accused sent reply but failed to companyply with the demand and the companyplainant lodged companyplaint under Section 138 of the Negotiable Instrument Act, against the accused.
In the trial the companyplainant examined himself as PW1 and examined CWs1 and 2 on his side and marked documents Exh.
The respondent herein companyplainant and the appellant accused were working as lecturers in a Government College at Bangalore.
In the present case the companyplainant and the accused were working as Lecturers in a Government companylege at the relevant time and the alleged loan of Rs.14 lakhs is claimed to have been paid by cash and it is disputed.
Both of them were governed by the Government Servants Conduct Rules which prescribes the mode of lending and borrowing.
ii Will number presumption under Section 139 of the N.I. Act accrues to the benefit of the companyplainant unless the accused rebuts that presumption?
Relying on the said ratio the High Court answered the two legal issues raised by it in the impugned judgment.
On the companytrary the companyplainant has admitted in his evidence that in the year 1997 he had obtained a loan of Rs.1,49,205/ from L.I.C. It is pertinent to numbere that the alleged loan of Rs.14 lakhs is claimed to have been disbursed in the year 1997 to the accused.
D1 to D5.
The source claimed by the companyplainant is savings from his salary and an amount of Rs.5 lakhs derived by him from sale of site No.45 belonging to him.
P1 to P23.
Though the companyplainant was an income tax assessee he had admitted in his evidence that he had number shown the sale of site No.45 in his income tax return.
The trial companyrt took into account the testimony of the wife of the companyplaint in another criminal case arising under Section 138 of the N.I. Act in which she has stated that the present appellant accused had number taken any loan from her husband.
Though the criminal appeals were preferred against the judgment of acquittal passed in all the cases arising under Section 138 of the N.I. Act, the factual matrix and the evidence adduced were different.
Accordingly it allowed the appeals and set aside the respective judgments of acquittal and remanded the cases to companyrts companycerned directing retrial.
There is numberhing on record to show that the prescribed mode was followed.
Further the companyplainant did number produce bank statement to substantiate his claim.
The case of the companyplainant is that the accused borrowed a loan of Rs.14 lakhs in cash on 1.12.1997 from him to start granite business, promising to repay the same with 3 interest per month on demand and issued post dated cheque dated 30.11.2000 for sum of Rs.29,12,000/ which included principal and interest and few days prior to presentation of the cheque on its due date to bank for encashment, the accused requested him number to present the cheque and took extension of time of another three years for repayment and finally issued a cheque dated 16.08.2005 for a sum of Rs.73,83,552/ which included principal and interest.
The present appeal is preferred challenging the said judgment.
The learned companynsel appearing for the appellant respondent companytended that the High Court erroneously clubbed a batch of 10 criminal appeals and formulated two questions of law and insofar as the present appeal is companycerned the trial companyrt never proceeded on the assumption that the presumption under Section 139 of the N.I. Act would enure to the benefit of the companyplainant only if he proves his financial capacity and on the companytrary the trial companyrt had for reasons recorded found that the accused has rebutted the presumption by placing companyent evidence that there was numberlegally recoverable debt or liability and the companyplainant had numbercapacity to lend huge amount of Rs.14 lakhs and, accordingly, dismissed the companyplaint by acquitting the accused.
The accused examined himself as DW1 and marked documents Exhs.
Aggrieved by the same the companyplainant preferred appeal in the High Court in Criminal Appeal No.368 of 2009, and the High Court heard the appeal along with 9 other appeals by framing two legal issues which are as under Whether an action under Section 138 of the N.I. Act for dishonor of cheque is the companyplainant required to establish his financial capacity to lend money?
The companycerned sale deed was also number produced.
The High Court after answering the two legal issues did number companysider the merits of each case individually and has simply remanded the matter to the trial companyrt for fresh companysideration.
NAGAPPAN, J. Leave granted.
This appeal is preferred against judgment and order dated 10.10.2013 passed by the High Court of Karnataka at Bangalore in Criminal Appeal No.368 of 2009 wherein the High Court set aside the judgment of acquittal of the trial companyrt and remanded the case to the trial companyrt for retrial.
Relying on the ratio laid down by this Court in the decision in Rangappa vs. Sri Mohan 2010 11 SCC 441 the High Court answered the first issue in the negative and the second issue in the affirmative.
It further held that the orders of acquittal recorded by the trial companyrt in all the appeals suffer from legal infirmity as the prosecution has been undone only on the ground that companyplainant had number proved his capacity to lend money and hence those orders are liable to be set aside.
