H. NARASIMHA RAO Vs. R. VENKATARAM

JUDGEMENT

(1.) THE short question that arises for consideration in this appeal is: Whether the dishonoured cheques issued towards repayment of time barred debt does not constitute an offence under Section 138 of the N.I. Act?

(2.) HEARD Sri H.T. Nataraja, learned Counsel for the appellant/complainant and Sri B.C. Rajanna, learned Counsel for the respondent/accused.

(3.) THE complainant and the accused were friends and colleagues in the then Karnataka Electricity Board. When the accused was about to retire, he approached the complainant for a loan of Rs. 60,0007 and agreed to repay the same within a short period. The complainant advanced a sum of Rs. 60,0007 to the accused in this way that a sum of Rs. 2007 was paid in cash and the balance amount of Rs. 59,8007 - was paid by three cheques. The accused has encashed the cheques. Though the loan amount was repayable within a short period, the accused took undue advantage of friendship with the complainant and agreed to repay the loan within six months with interest at the rate of 8% p.a., but the accused failed to keep up his promise. On complainant's persistent demand, the accused issued two cheques, one bearing No. 152400 dated 15.5.1999 for a sum of Rs. 50,000/ - and another cheque bearing No. 152921 dated 25.5.1999 for a sum of Rs. 10,0007 - both drawn on the Bangalore City Co -operative Bank Limited, Bangalore, in favour of the complainant towards discharge of the loan amount stating that the cheques would be honoured on presentation to the Banker. But when the cheques were presented, they were bounced and returned on 1.6.1999 with an endorsement "funds insufficient". The complainant issued a demand notice dated 10.6.1999 calling upon the accused to pay the amount of dishonoured cheques within 15 days. The accused acknowledged the receipt of the same but sent an untenable reply dated 24.6.1999. Therefore, the complainant filed a private complaint against the accused for the offence under Section 138 of the Negotiable Instruments Act (in short, 'the Act'). The accused denied the accusation. The complainant has got him examined as P.W -1 and got marked Exs. P -1 to P -10. In rebuttal, the accused has got him examined as D.W -1 besides examining one Khalandar Baigh as D.W -2.