Delhi District Court
Pankaj Gidwani vs Kusum Bhargava on 2 January, 2013
Pankaj Gidwani vs Kusum Bhargava
IN THE COURT OF MS. DEEPIKA SINGH, METROPOLITIAN
MAGISTRATE, NORTH, DELHI
CC No. 2574/11
Pankaj Gidwani,
S/o Sh. Ashok Kumar Gidwani
R/o E-003, G. F., Jhulelal Apartment,
Pitam Pura, New Delhi-110034
....................Complainant
vs.
Smt. Kusum Bhargava,
W/o Late Sh. P. D. Bhargava
R/oE-101, Kamla Nagar,
Delhi-110007.
............................Accused
The offence complained of or proved : u/s 138 NI Act
The plea of the accused person : Not guilty
Final order : Convicted
Date of institution of complaint : 21.05.2011
Date on which reserved for judgment : 14.12.2012
Date of pronouncement of judgment : 02.01.2013
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Pankaj Gidwani vs Kusum Bhargava
JUDGMENT:
1. Vide this judgment this court shall dispose off the present complaint filed u/s 138 Negotiable Instruments Act 1881 filed by the complainant against the accused.
2. Brief history of the facts stated in the complaint are that the accused requested the complainant to advance her a loan of Rs.4,50,000/- for her son for organizing a conference with the promise that the loan amount shall be repaid alongwith commission of Rs.20,000/- in two installments by 26.09.2009. The complainant advanced her a loan of Rs.4,50,000/- ( Rs. Four Lacs fifty thousand only) on 22.07.2009 without reducing the transaction into writing as the accused always had been very regular in repaying the loan amount along with commission in the past. Then again on 12.08.2009, complainant advanced another loan of Rs. 6 Lacs at the request of the accused with the condition that the loan amount shall be repaid alongwith the commission of Rs.1,45,000/- in three installments in the month of October and November, 2009. After many months of delay the accused finally paid to the complainant Rs. 1,50,000/- and Rs. 3,00,000/- on two different occasions out of the total loan amount of Rs.10,50,000/- and total commissions of Rs. Page 2 of 13
Pankaj Gidwani vs Kusum Bhargava 1,65,000/-. In the month of October 2010, the accused issued three post dated cheques bearing no. 043844, 043845 and 043846 of Rs.2,00,000/- each dt. 20.11.2010 each drawn on the Corporation Bank, Kamla Nagar, Delhi with the request not to present the cheques without prior consent of the accused, the cheques are ExCW1/1 to ExCW1/3. When the accused neither made the payment as assured nor gave the consent for presenting the said three cheque, the complainant presented these three cheques for encashment on 11.03.2011 alongwith three original deposit slips, the deposit slips are Ex.CW1/4 to Ex. CW1/6 and the cheques were received back dishonoured with the remarks "Funds Insufficient" on 15.03.2011, the cheques returning memo is ExCW1/7 to ExCW1/9. Thereafter, the complainant through his advocate got issued legal demand notice dt.08.04.2011 through Regd. Post and Courier upon the accused, the leagal demand notice is ExCW1/10 and the postal receipts are ExCW1/11 to ExCW1/13. The said legal notice was sent to the accused within the stipulated period from the intimation of the date of the dishonour of the cheques in question. Accused sent a reply to the legal notice dt.28.04.2011 and the same is Ex. CW1/14. On failure of the accused person to make the payment within the stipulated period, the present complaint was filed.
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Pankaj Gidwani vs Kusum Bhargava
3. After hearing the arguments on summoning, sufficient grounds were made out against the accused u/s 138 NI Act and process was issued against him. On his appearance, the accused was admitted to bail on dt.29.11.2011.
4. Notice U/s 251 Cr.P.C was framed upon the accused vide order dt. 14.09.2011 to which the accused pleaded not guilty and claimed the trial.
5. Complainant examined himself in his evidence and he adopted his pre- summoning affidavit as the post summoning affidavit, where he reiterated the same facts.
During the cross examination, he deposed that he has arranged Rs.6 Lacs from his father and himself. It was not lying in his bank account. Though he maintained the books of account of his business but he has not mentioned this transaction in his books of accounts and that is why he has not placed it on the record. He is into the business of fresh fruits trading in Azadpur Mandi. He has passed class 12th and he is a dropped out from Delhi University in 2nd year of graduation. He used to file his income tax return but he has not filed his income tax returns for last 3 - 4 years. No recent ITR has been filed. As he has not filed his Page 4 of 13 Pankaj Gidwani vs Kusum Bhargava ITRs so he can not show the loan amounts of Rs.4,50,000/- as well as Rs.6,00,000/-. He know this fact if the transaction is more than Rs. 20,000/- in that case amount is paid in cheque but he has not given the amount in cheque because of relation. It is not correct that he has paid only Rs. 6,00,000/-. He has also asked for a commission amount of Rs. 20,000/- and Rs. 1,45,000/-. He has not taken any license regarding these transactions. He was given the cheques and was also informed that there would not be any need for presentation of these cheques as the amount would be delivered. He has not taken any prior permission before presenting the cheque as the cash was not delivered. It is wrong to suggest that he has given only Rs. 6,00,000/- for personal use in August,2010 and towards this loan he has received three cheques as security in August, 2010. It is correct to suggest that he received Rs. 4,50,000/- from the accused but it is wrong to suggest that he has received the same in lieu of the present loan transaction of Rs. 6,00,000/-.
8. All the incriminating evidence had been put to the accused to which she replied in her statement u/s 313 Cr.P.C that she obtained a loan of Rs.6,00,000/- only from the complainant out of which she has already paid Rs.1,50,000/- in cash in the month of December, 2010 and Rs. 3,00,000/- in cash in the month of January, Page 5 of 13 Pankaj Gidwani vs Kusum Bhargava 2011. She further said that three cheques in question were given as duly filled in to the complainant for the purpose of security and she never obtained any other loan of Rs. 4,50,000/- as alleged by the complainant. She further stated that complainant agreed not to present the cheques for encashment as payment was to be made by her in cash against those cheques. The cheques in question have been presented without her consent and intimation. She stated that at present, there is only a liability of Rs. 1,50,000/- outstanding towards the complainant. She had also stated that she wanted to lead defence evidence.
9. The accused had examined herself in her defence and reiterated the contents made by her in statement u/s 313 CrPC in her defence. She further submitted that loan of Rs. 6,00,000/- was towards the personal loan and not for the conference as alleged by the complainant. The complainant did not return the security cheques issued by her and kept on lingering. Moreover, the complainant had represented the cheques without her consent and intimation which was agreed by her at the time of issuance of the cheques. She further denied that complainant had earlier advanced a loan of Rs. 4,50,000/-. She had made payment of Rs. 4,50,000/- out of the loan of Rs. 6,00,000/- which was for her personal purpose and Page 6 of 13 Pankaj Gidwani vs Kusum Bhargava that she is ready and willing to make payment of the balance amount of Rs. 1,50,000/-.
During her cross examination she submitted that she had no document to show that the cheques issued by her were for security purpose. She had not mentioned the loans given by the complainant to her in her Income Tax Return as money was given to her in cash. She came to know regarding the dishonour of the cheques issued by her through the legal notice sent by the complainant. She issued the cheques in October, later dated in August, 2010. She had no receipt or proof to show that she issued the cheques before paying of Rs. 4,50,000/-. It is wrong to suggest that she paid Rs. 4,50,000/- against the loan dated 22.07.2009 before issuing the three cheques against the second loan of Rs. 6,00,000/- and commission against both the loans is still due. There is nothing either in form of police complaint or legal notice that she demanded the return of cheques issued by her. Voluntarily stated that she verbally asked to return the cheques. She put the date on cheque for repayment after two months from date of issuing the cheques.
10. I have gone through the evidence, written submissions and heard the final arguments advanced by both the parties carefully.
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Pankaj Gidwani vs Kusum Bhargava
11. The case laws material for the present facts and circumstances are discussed below.
In case entitled as "Rangappa vs Sri Mohan" [(2010), 11, Supreme Court Cases 441] where the Hon'ble Supreme Court of India, held that the bare denial of the passing of the consideration apparently does not appear to be any defence. To disprove the presumptions, the defendant has to bring on record such facts and circumstances, upon consideration on which the Court may either believe that the consideration does not exist or its non-existence was so probable that a prudent man would, under the circumstances of the case, shall act upon the plea that it does not exist and it was held that there is an initial presumption, which favours the complainant in the sense that the presumption mandated by Sec. 139 of NI Act does indeed include the existence of a legally enforceable debt or liability. Since the accused did admit that the signatures on the cheques was his, the statutory presumption comes into play and same has not been rebutted even with regard to the material submitted by the complainant.
10. In the judgment "Hiten P. Dalal vs. Bratindra Nath Banerjee" AIR 2001 (SC) 3897 it was held that presumption under NI Act is a presumption of law Page 8 of 13 Pankaj Gidwani vs Kusum Bhargava as distinguished from a presumption under a fact which describes provisions by which the Court "may presume" a certain state of affairs. Presumptions are rules of evidence and do not conflict with presumptions of innocence because by the later all that is meant is that the prosecution is obliged to prove the case against the accused beyond reasonable doubt. Obligation on the prosecution may be discharged with the help of presumption of law or fact unless the accused adduces evidence showing the reasonable possibility of non-existence of a presumed fact.
11. In the judgment entitled "Pradeep Aggarwal & Ors vs Y. K. Goel", Cr. M. C. 66/2009 (Hon'ble High Court of Delhi), where it was held that complaints u/s 138 NI Act is a summary trial and accused should first disclose his defence and merely saying "He is innocent" or "He plead not guilty" will not be sufficient and onus is on the accused to show that no offence could have been deemed to be committed by him for some specific reasons and defences.
It was further held that u/s 138 NI Act, there is no presumption that even if an accused fails to bring out his defence, he is still to be considered innocent.
12. In the judgment "Mosaraf Hossain Khan vs Bhagheeraha Engg. Page 9 of 13
Pankaj Gidwani vs Kusum Bhargava Ltd." AIR 2006 S. C. 128(2006), it was held that the object of the provision of section 138 NI Act is that for proper and smooth functioning of business transaction in particular, use of cheques as negotiable instruments would primarily depend upon the integrity and honesty of the parties. It was noticed that cheques used to be issued as a device inter alia for defrauding the creditors and stalling the payments. Dishonour of a cheque by the bank causes incalculable loss, injury and inconvenience to the payee and the entire credibility of the business transactions within and outside the country suffers a serious setback.
13. In the judgment "K.N. Beena Vs. Muniyappan, AIR 2001 SC 2895, where it was held that mere denial / averments in reply by the accused are not sufficient to shift the burden of proof onto the complainant. Accused has to prove in trial by leading cogent evidence that there was no debt or liability, which in the present case accused has not done.
14. From the material on record, it is well established that complainant and accused knew each other through the son of the accused, as both the complainant and accused's son were class-mates in school. In the cross examination of the Page 10 of 13 Pankaj Gidwani vs Kusum Bhargava accused, she has admitted knowing the complainant through her son as both were class mates in school. Accused has also admitted having issued the cheques in question in her reply to the legal demand notice, at the time of framing of notice under sec 251 Cr.P.C, statement u/s 313 Cr.P.C and in her evidence. She has also admitted receiving of the legal demand notice from the complainant. The limited defence accused has taken is, she has already paid Rs.4,50,000/- out of the loan amount of Rs.6,00,000/- only to the complainant and she asked the complainant to return the cheques which were issued as security but he kept on lingering. Assuming for a moment that the accused repaid Rs.4,50,000/- to the complainant, what prevented her to take receipt of the same. If the complainant did not return her cheques issued as security, why did she not file any complaint before the police or any court of law regarding the alleged high-handedness of the complainant in not returning her cheques. In her deposition, in cross examination, she deposed that she has no receipt or proof to show that she had already paid Rs.4,50,000/-. Meaning thereby, that she owe a debt and liability towards the complainant. Neither any document nor any witness has been produced and examined by the accused to show that she paid Rs.4,50,000/- out of the loan amount of Rs.6,00,000/- to the complainant. The accused also stated that she took the loan for personal use Page 11 of 13 Pankaj Gidwani vs Kusum Bhargava whereas the complainant has stated that she took the loan for organizing conference. Accused further failed to bring evidence that she took the loan for personal use and not for organizing conference. Further, this argument also does not absolve her of liability u/s 138 NI Act, as the provision only requires that cheque has been issued for consideration, which in the present case has been done. Hence the accused has miserably failed in substantiating any reasonable probable defence.
12. Ld. Counsel for the accused has relied upon the case entitled M.S. Narayana Menon @ Mani vs State of Kerala & Anr 2006 (6) Sec 39 and M/s Alliance Infrastructure vs. S. Vinay Mittal Crl. M.C. No. 2224/2009 decided on 18th January 2010 of the Hon'ble High Court of Delhi. I have highest regard for the case laws cited on behalf of the accused. However, the same has been pronounced in different context and is of no help to the accused.
13. Hence, the accused has miserably failed in substantiating her defence and showing that there is no liability of the accused towards the complainant. The complainant successfully proved all the essential requirements of sec 138 of the Act i.e. :
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Pankaj Gidwani vs Kusum Bhargava
a) The cheque for an amount is issue by the accused to the complainant on a bank account maintained by him.
b) The said cheque is issued for the discharge, in whole or in part of any debt or other liability by the accused.
c) The cheque is returned by the bank unpaid on account of insufficient amount to honour the cheque.
d) The cheque is presented to the bank within 6 months from the date on which it is drawn and is within the period of its validity.
e) Within 30 days demand notice is issued by the complainant on receipt of information by him from the bank regarding the dishonour of the cheque.
f) The drawer of the said cheque / accused fails to make the payment of the said amount of the money to the complainant within 15 days of the said notice.
g) The debt or liability against which the cheque was issued is legally enforceable.
17. Under the aforesaid discussion, accused Ms.Kusum Bhargava is held guilty for offence U/s 138 NI Act and she is consequently convicted for the offence u/s 138 of Negotiable Instruments Act.
Announced in open court (Deepika Singh)
today i.e. on 02.01.2013 MM NI Act / North / Delhi
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