Delhi District Court
M/S Aggarwal Electric Co. vs M/S Uniflow Pumps Engineers Page No 1 /16 on 28 August, 2014
IN THE COURT OF SH. PAWAN SINGH RAJAWAT
METROPOLITAN MAGISTRATE 07 (CENTRAL), ROOM NO. 137,
TIS HAZARI COURTS, DELHI
M/s Aggarwal Electric Co.
through its Prop. Satish Aggarwal,
at Narela Road, Piou Maniyar , Kundli,
Sonepat, Haryana
............. Complainant
Versus
M/s Uniflow Pumps Engineers,
through its Prop,
Sh L.N. Manchand,Basai Road,
Opposite N.K. Rubber Factory,
Gurgaon, Haryana
.............. Accused
CC No. 170/1
PSSubzi Mandi
1. Serial No. of the case : 02401R125172010
2. Date of commission of offence: 03.03.2010
3. Date of Institution : 03.04.2010
4. Date when judgment : 12.02.2014
was reserved
5. Date when Judgment : 28.08.2014
was pronounced
6. Offence Complained of : Section138 Negotiable
and proved Instrument Act
CC no 170/1
PS Subzi Mandi
M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 1 /16
7. Plea of accused : Pleaded not guilty
and claimed trial
8. Final Judgment : Accused Convicted
for the offence
U/s 138 Negotiable
Instrument Act, 1881
JUDGEMENT:
BRIEF STATEMENT OF REASONS FOR THE DECISION OF THE CASE:
1. The brief facts of the case are that accused being Proprietor of M/s Uniflow Pumps Engineer issued two cheques bearing no 838706 dated 15.12.2009 for a sum of Rs 15,000/ and cheque no 838707 dated 15.01.2010 for a sum of Rs 15,000/ towards his liability but the said cheques when presented were returned with remarks "Kindly contact Drawar" and despite service of legal notice dated 15.02.2010 accused failed to make the payment for the said cheque and thereby committed offence U/s 138 NI Act. Accused was summoned on 14.11.2011.
2. After appearance of the accused notice U/s 251 Cr.P.C was served upon him to which he pleaded not guilty and claimed trial and stated that he made some payment in cash to the complainant and his CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 2 /16 liability is to the extent of Rs 20,000/.
3. COMPLAINANT'S EVIDENCE:
3.1 Complainant has adopted his evidence filed by of affidavit in pre summoning evidence during post summoning evidence and examined as CW1. During cross examination by defence counsel CW1 admitted that he deals in both fresh and defective electrical goods and sell the defective goods by curing the defects . He admitted that accused has purchased goods which were cured by company. He denied the suggestion that accused has purchased goods worth Rs 1 lac . He also denied that accused made payment by cash. He also denied the suggestion that only six cheques were given by he accused out of which one was honored and three cheques are still lying with the complainant for which he is received payment. He specifically stated that he intimated the accused about the dishonor of the cheques but failed to recollect the dates and stated that intimation was sent at the factory address of the accused in Gurgaon. He admitted the suggestion that accused agreed to pay Rs 25,000/ in cash towards the cheques in question but complainant presented the cheques in order to extort additional Rs 5,000/ . He also denied that he has filed forge and frivolous complaint against the accused..
4. Statement of accused U/s 313 r/w 281 Cr.P.C was recorded on CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 3 /16 12.11.2013 wherein he stated that he had issued two cheques with the understanding that same are not be presented and made part payment of Rs 45,000/. He admitted that the cheques were dishonoured with remarks " kindly contact drawar" . He also admitted that the accused received the legal demand notice by complainant and stated he is only liable to pay Rs 25,000/. He stated that he want to lead evidence in his defence. But thereafter he stated that he do not lead any evidence in his defence. Thereafter, final arguments were heard.
5. FINAL ARGUMENTS:
5.1 Ld. Counsel for complainant argued that accused has admitted the issuance cheque and received legal notice and consequent payment at he had issued the cheques in question and failed to pay the same. He prays for conviction.
5.2 On the other hand, Ld. Counsel for accused argued that accused is not liable to pay the cheque amount. He also argued that this Court has no territorial jurisdiction to decide the present complaint. He relied upon the judgement of Hon'ble Supreme Court of India in the matter of Nishant Aggarwal Vs Kailash Kumar Sharma decided on 01.07.2013. He prays for acquittal.
6. For successful prosecution of offence u/s 138 of N.I. Act, the following ingredients have to be proved:
CC no 170/1
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a) The cheque must have been issued for discharge of whole or in part of legally recoverable debt or other liability.
b) The cheque have been presented in the bank on which it is drawn within a period of its validity.
c) The cheque should have been returned by the bank unpaid due to reason of insufficiency of funds or that it exceed the amount arranged to be paid from that account.
d) The payee or holder in due course makes the demand of payment of the said amount of money by giving a notice in writing to the drawer of cheque within 30 days of the receipt of information by him from the bank regarding the return of the cheque.
e) Lastly, the drawer of said cheque fails to make the payment to the payee or holder in due course within 15 days of receipt of said notice and the complaint is made within one month of the date on which cause of action arises under clause (c) of the proviso to the section 138 N.I. Act.
7. Whether the cheque is issued for discharge of legal debt or CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 5 /16 liability of the accused: As per complaint, accused purchased electrical goods from the complainant and issued cheques in question towards discharged of his liability. The cheques Ex CW1/ 1 and Ex CW1/2 were admittedly issued by the accused in favour of the complainant. But accused blaims that his liability is only Rs 25,000/ whereas the cheques in question totals to Rs 30,000/. In view of such counter claims it is necessary to see the effect of statutory presumptions under section 118 (a) and section 139 Negotiable Instruments Act in order to judge the legal and factual merit of case. In M/s. Kumar Exports Vs. M/s. Sharma Carpets, 2009(1) R.C.R.(Criminal) 478 the Apex Court examined the scope and ambit of presumptions u/s 118 and Section 139 of NI Act.
"Under Section 138 of the Act the accused has two options. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the nonexistence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 6 /16 existed. To rebut the statutory presumptions an accused is not expected to prove his defence beyond reasonable doubt as is expected of the complainant in a criminal trial. The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumptions, apart from adducing direct evidence to prove the non existence of consideration the accused may also rely upon circumstantial evidence and if the circumstances so relied upon are compelling, the burden may likewise shift again on to the complainant. The accused may also rely upon presumptions of fact, for instance, those mentioned in Section 114 of the Evidence Act CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 7 /16 to rebut the presumptions arising under Sections 118 and 139 of the Act. Once such rebuttal evidence is adduced and accepted by the court, having regard to all the circumstances of the case and the preponderance of probabilities, the evidential burden shifts back to the complainant and, thereafter, the presumptions under Sections 118 and 139 of the Act will not again come to the complainant's rescue".
8. Accused admitted the issuance of cheque and has not denied the signatures on the cheque in question. It has not been explained by the accused why the cheques totalling Rs 30,000/ were issued by him when he is claiming his liability only to the extent of Rs 25,000/. Despite cross examination of CW1 accused has not been able to rebut the presumptions regarding issaunce of cheque. No defence evidence was led to disprove his liability towards the cheques in question. No documents has been filed to show alleged cash payment of Rs 45,000/. Even the presumptions of fact were not relied upon by the accused as CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 8 /16 those mentioned in Section 114 of the Evidence Act to rebut the presumptions arising under Sections 118 and 139 of the Act. In the circumstances, I am satisfied that accused has failed in rebutting the presumption and onus has now shifted upon the accused to show that the cheque in question was without consideration and he was not liable to pay the cheque amount in question. Despite cross examining the complainant's witness i.e CW1 and also by leading defence evidence the accused has not able to rebut the presumption u/s 118 as well as u/s 139 N.I. Act. In fact the complainant proved the cheque in question against the accused. More importantly the accused himself admitted that he issued the cheque and further admitted his signature on the cheque in question. The accused failed to bring any probable reason for handing over the cheque to the complainant. Moreover, complainant examined as CW1 denied the suggestions put in this regard. Even during his statement U/s 313 Cr.P.C he had admitted issuance of cheque as well as their dishonour and receipt of legal notice. Therefore, this ingredient of offence is proved against the accused.
9. The cheque was presented in the bank within the CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 9 /16 period of its validity: The cheque(s) which are exhibited as CW1/1 and CW1/2 bears a date of 15.12.2009 and 15.01.2010 was presented in the bank on 28.01.2010, this fact is not at all disputed by the accused. Therefore the same taken to be presented within the period of limitation of six months and this ingredient of the offence is clearly established.
10. The cheque was returned unpaid by the bank due to reason of insufficiency of funds: The cheques were dishonoured vide returning advice certificate dated 29.01.2010 and 29.01.2010 which is ExCW1/3 and ExCW1/3A due to reason "Kindly contact drawar". In the matter of M/s Electronics Trade and Technology Development Corporation Ltd Vs M/s Indian Technologist and Engineers Pvt Ltd. AIR 1996 SC 2339 , wherein it is held that "refer to drawer" ground amounts to dishonour of cheque which is covered within meaning of section 138 of the Act. Moreover in terms of Section 146 N.I. Act the factum of dishonour of cheques has been established as accused did not lead any evidence to the contrary. As such, the complainant discharged their part of burden of proving the background facts so that CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 10 /16 presumption u/s 146 N.I. Act can be raised. As such the complainant has also proved this ingredient of the offence under consideration.
11. The payee makes a demand within 30 days of the receipt of dishonoured cheque : The legal notice dated 15.02.2010 was sent by Registered AD and UPC. As per averment, the notice sent through registered AD and UPC not received back and was duly served. Moreover, in view of section 27 of the General Clauses Act ,1897, it is to be presumed that legal notice sent to the accused through post has been served upon the accused as the same was sent at the correct address and the same was prepaid. Even accused admitted receipt of legal notice. Accordingly, this ingredient of the offence is also proved by the complainant.
12. The accused failed to make the payment towards dishonoured cheque within 15 days of the receipt of legal notice: The complainant has stated in the complaint that the said notice was received by the accused but despite service of aforesaid legal notice the accused has failed to make the payment within the stipulated period of 15 days, and thus CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 11 /16 committed an offence u/s 138 of NI Act. It is undisputed that the accused did not made the payment of the cheque in question nor such evidence led by the accused. Moreover accused admittedly had not given any reply nor take any legal action against the complainant. Therefore, this ingredient of the offence stands established against the accused.
13. The argument of Ld Counsel that this court has no jurisdiction to decide the present complaint is humbly rejected as cheque in question was presented for payment through, CTS, Clearing , Delhi . The reliance on the judgment in the matter of Nishant Aggarwal (Supra) misplaced as it is settled position of law that the territorial jurisdiction to file the complaint for offence U/s 138 N I Act shall lie at a place where either party resides or works for gain or the cheque in question was issued or presented and at a place where legal notice was served. In the present case the legal notice was issued at two addresses. As per the receipt of UPC Ex CW1/6 the address of A1/70 Chattarpur Enclave, Phase 2 Delhi74 is mentioned. No question has been asked to the complainant witness as to either that such address does not belong to the accused or no legal CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 12 /16 notice has been served upon such address.
14. In view of the evidence on record and above discussions, I am satisfied that the complainant has proved beyond reasonable doubts that the accused issued cheques for discharge of the liability which was dishonoured and despite receipt of legal notice, accused failed to pay the cheque amount and therefore, committed the offence U/s 138 of Negotiable Instruments Act , 1881.
15. Accordingly, accused Loknath Manchanda Proprietor of M/s Uniflow Pumps Engineers is convicted for the offence under Section 138 Negotiable Instruments Act, 1881. Copy of judgment be given free of cost to the convict.
Put up for arguments on sentencing at 2:00 pm. ANNOUNCED IN THE OPEN (PAWAN SINGH RAJAWAT) COURT ON 28.08.2014 Metropolitan Magistrate 07 (Central), Tis Hazari Court CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 13 /16 IN THE COURT OF SH. PAWAN SINGH RAJAWAT METROPOLITAN MAGISTRATE 07 (CENTRAL), ROOM NO. 137, TIS HAZARI COURTS, DELHI M/s Aggarwal Electric Co.
through its Prop. Satish Aggarwal, at Narela Road, Piou Maniyar , Kundli, Sonepat, Haryana ............. Complainant Versus M/s Uniflow Pumps Engineers, through its Prop, Sh L.N. Manchand,Basai Road, Opposite N.K. Rubber Factory, Gurgaon, Haryana .............. Accused CC No. 170/1 PSSubzi Mandi U/S:138 Negotiable Instrument Act Present: None for Complainant Convict Loknath Manchanda with Counsel O R D E R ON SENTENCING Arguments on the point of sentence heard today. Ld Counsel for accused submits that he is a first time offender and have to look after his family. He prays for CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 14 /16 leniency In the present case cheques in question of Rs 15,000/ each were given in the year 20092010 which were dishonored and despite receipt of legal notice, convict choose not to pay the cheque amount. Accordingly, I am satisfied that suitable compensation should be awarded to the complainant.
In the facts and circumstances of the case, Convict Loknath Manchanda is sentenced to pay Rs 40,000/ (Rupees Forty Thousand Only) to the complainant and in default of payment, convict shall undergo simple imprisonment for six months.
At this stage, an application terms of Section 389 Cr.P.C for suspending the sentence and releasing convict on bail for filing of appeal. Heard.
During the trial, conduct of convict was satisfactory. Hence, convict is admitted to bail on furnishing PB and SB in sum of Rs 20,000/. Bail bond furnished, considered and accepted till 28.09.2014.
Copy of this order be given free of cost.
CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 15 /16 Copies of order alongwith full papers i.e exhibited documents, copies of statements of witnesses and statement of accused U/s 313 Cr.P.C be given free of cost to the convict. File be consigned to Record Room amd Ahlmad is directed to place the Bail bond on 28.09.2014 awaiting the confirmation of filing of appeal.
ANNOUNCED IN THE OPEN (PAWAN SINGH RAJAWAT) COURT ON 28.08.2014 Metropolitan Magistrate 07 (Central), Tis Hazari Court CC no 170/1 PS Subzi Mandi M/s Aggarwal Electric Co. Vs M/s Uniflow Pumps Engineers Page no 16 /16