High Court of Karnataka Acquits Accused in Counterfeit Currency Case Due to Procedural Lapses and Lack of Independent Witnesses. Conviction under Sections 489B and 489C IPC set aside as prosecution failed to prove possession and intent beyond reasonable doubt.

High Court: Karnataka High Court Bench: BENGALURU In Favour of Accused

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2026-05-18 20:50:13

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Case Note & Summary

The appellant, T.N. Kumara, was convicted by the Principal District and Sessions Judge, Mysore, in SC No.12/2012 for offences under Sections 489B and 489C of the Indian Penal Code, 1860, for allegedly possessing and trafficking 30 counterfeit currency notes of Rs.100 denomination. The prosecution case was that on 2 March 2010 at 12:30 p.m., near the Institute of Engineering Building, Mysore, the appellant was found in possession of the notes, which bore a single serial number 2BE901745. The appellant challenged his conviction before the High Court of Karnataka. The High Court examined the evidence and found several procedural lapses. The recovery was made from a bag, but no independent witnesses were examined despite their availability, violating the requirement under Section 100 of the Code of Criminal Procedure, 1973. The seized notes were not sent to the Currency Note Press or any expert for examination to confirm they were counterfeit. The prosecution also failed to prove that the appellant had the intent to use the notes as genuine or to traffic them. The court held that the burden of proof was on the prosecution, which was not discharged. Consequently, the appeal was allowed, the conviction and sentence were set aside, and the appellant was acquitted.

Headnote

A) Criminal Law - Counterfeit Currency - Sections 489B and 489C Indian Penal Code, 1860 - Possession and Trafficking - The appellant was convicted for possessing and trafficking counterfeit currency notes. The High Court held that the prosecution failed to prove conscious possession and intent to use the notes as genuine, as the recovery was not witnessed by independent persons and the notes were not sent for expert examination. The appeal was allowed and the appellant was acquitted. (Paras 1-20)

B) Evidence Law - Recovery of Contraband - Section 100 Code of Criminal Procedure, 1973 - Independent Witnesses - The recovery of counterfeit notes was made from a bag, but no independent witnesses were examined despite their availability. The court held that the non-examination of independent witnesses casts doubt on the prosecution case. (Paras 10-15)

C) Criminal Law - Expert Evidence - Counterfeit Currency - The prosecution did not send the seized notes to the Currency Note Press or any expert for examination to confirm they were counterfeit. The court held that without expert evidence, the notes cannot be conclusively held to be counterfeit. (Paras 16-18)

Issue of Consideration

Whether the conviction of the appellant under Sections 489B and 489C IPC is sustainable based on the evidence on record.

Final Decision

Appeal allowed. The judgment of conviction and order of sentence dated 3 January 2013 passed by the Principal District and Sessions Judge, Mysore in SC No.12/2012 is set aside. The appellant is acquitted of the offences under Sections 489B and 489C IPC.

Law Points

Burden of proof on prosecution
Requirement of independent witnesses under Section 100 CrPC
Possession must be conscious and exclusive
Intent to use as genuine must be proved
Counterfeit currency notes must be examined by expert

Case Details

2024 LawText (KAR) (08) 24

CRL.A No. 55 of 2013 (C)

2024-08-31

Ramachandra D. Huddar

Sri P. Nataraju (for appellant), Sri Divakar Maddur (for respondent)

T.N. Kumara

State of Karnataka

Nature of Litigation

Criminal appeal against conviction for offences under Sections 489B and 489C IPC.

Remedy Sought

Appellant sought setting aside of conviction and acquittal.

Filing Reason

Appellant was convicted by trial court for possessing and trafficking counterfeit currency notes.

Previous Decisions

Trial court convicted the appellant on 3 January 2013 in SC No.12/2012.

Issues

Whether the prosecution proved that the appellant was in conscious possession of counterfeit currency notes? Whether the prosecution proved that the appellant intended to use the notes as genuine or traffic them? Whether the non-examination of independent witnesses and lack of expert evidence vitiates the conviction?

Submissions/Arguments

Appellant argued that the recovery was not witnessed by independent persons and the notes were not sent for expert examination. Respondent argued that the evidence of police witnesses was sufficient and the conviction was correct.

Ratio Decidendi

The prosecution must prove conscious possession and intent to use counterfeit currency as genuine beyond reasonable doubt. Failure to examine independent witnesses and obtain expert opinion on the seized notes renders the prosecution case doubtful.

Judgment Excerpts

The appellant has called in question the judgment of his conviction and order of sentence dated 3rd January 2013 passed by the Prl. District and Sessions Judge, Mysore in SC No.12/2012 finding him guilty of committing the offences under Section 489B and C of Indian Penal Code, 1860. The recovery was made from a bag, but no independent witnesses were examined despite their availability. The seized notes were not sent to the Currency Note Press or any expert for examination to confirm they were counterfeit.

Procedural History

The appellant was convicted by the Principal District and Sessions Judge, Mysore on 3 January 2013 in SC No.12/2012. He appealed to the High Court of Karnataka under Section 374(2) CrPC. The appeal was reserved for judgment and pronounced on 31 August 2024.