VASAVI FINVEST LIMITED Vs. JAGADEESH HEGDE

JUDGEMENT

(1.) Heard the learned Counsel for the appellant. This Court had directed reconstruction of the records of the Trial Court in view of the circumstance that the records of the Trial Court have been destroyed. So far, there has been little progress in the reconstruction of the records. In any event, the judgment of the Trial Court as well as the copy of the legal notice and the deposition of the complainant are available. From a reading of the judgment, there is sufficient material to consider the case on merits and therefore, the matter is taken up for consideration on merits.

(2.) It is to be noticed that the present appellant was the complainant before the Trial Court alleging offences punishable under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as 'the NT Act', for brevity). The respondent having entered appearance, had sought to raise the defence that no doubt there was a loan transaction between one Chandrakumar and the present appellant, and the respondent had merely acted as a surety for the loan transaction. The money in a sum of Rs. 1,40,000/- was lent on the basis of a promissory note to which the present respondent was also a signatory, but only in the capacity of a surety for the due repayment of the loan. In furtherance of acting as a surety, the respondent was also required to issue a blank cheque duly signed by him and it is that document which is the basis for the complaint. Further, in the course of the trial, the respondent is said to have elicited an admission from the complainant to the effect that the respondent was indeed a surety to the transaction and the Court having found that if the complainant on the other hand wanted to contend that there was an independent transaction whereby the respondent had borrowed money on the strength of a promissory note, it was for the complainant to produce material in that regard, in support of which there was no material forthcoming. Further, in the face of the further circumstance that insofar as Chandrakumar, the actual borrower according to the respondent, had been proceeded against in an independent proceeding which even according to the complainant, was pending before another Court, the Court has come to a conclusion that the respondent had sufficiently rebutted the presumption under Section 139 of the NI Act which presumes that the cheque has been issued for due consideration in favour of the holder of the cheque and therefore, the burden was on the complainant to establish that it was issued for due consideration, as there was an admission that the respondent had acted merely as a surety to the transaction. It is on that basis that the complaint was dismissed and the accused was acquitted.