Delhi District Court
CT CASES/625513/2016 on 23 May, 2022
Balkishan Sharma v. Dheeraj Kumar Kaushik
CC No 625513/2016
IN THE COURT OF MS. TWINKLE CHAWLA: MM, NI ACT-02, SOUTH-
EAST DISTRICT, SAKET COURTS COMPLEX: NEW DELHI
Balkishan Sharma v. Dheeraj Kumar Kaushik
CC No 625513/2016
U/s 138 Negotiable Instruments Act, 1881
1. CIS number : DLSE020047072014
2. Name of the Complainant : Balkishan Sharma
3. Name of the Accused, : Dheeraj Kumar Kaushik
parentage & residential R/o H. No. D-109, Gali No. 4, Hari Nagar,
address Saurabh Vihar, Badarpur
4. Offence complained of or : U/s 138 of Negotiable Instruments Act,
proved 1881
5. Plea of the Accused : Pleaded not guilty and claimed trial
6. Final Judgment/order : ACQUITTED
7. Date of judgment/order : 23.05.2022
JUDGMENT
1. Complainant has filed the present complaint under Section 138 /142 of Negotiable Instruments Act, 1881 ("NI Act") on the averments that, the Complainant being in friendly relations with the Accused advanced a loan of Rs. Page 1 of 19
Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 10,00,000/- for urgent need of the Accused, which was to be repaid before 15.10.2014. As a receipt of the said loan, the Accused is stated to have issued a cheque bearing No. 245125 dt. 15.10.2014 drawn on Axis Bank, New Delhi, for an amount of Rs. 10,00,000/-, in favour of the Complainant (hereinafter referred as "cheque in question").
2. However, when the Complainant presented the cheque in question; the same was returned unpaid vide return memo dated 16.10.2014, for the reason "funds insufficient". The Complainant sent the legal demand notice dated 27.10.2014 through his counsel by speed post at the registered address of the Accused. The Accuse replied by way of reply dt. 30.10.2014Hence, despite the service of the legal demand notice, the Accused failed to make the payment and hence, the Complainant filed the present complaint.
3. After taking pre-summoning evidence, Accused was ordered to be summoned in this case for commission of offence under Section 138 of Negotiable Instruments Act, 1881 ("NI Act"), vide order dated 26.03.2015.
4. Accused appeared and was released on bail on 05.01.2016. On finding a prima facie case, notice U/s 251 of the Criminal Procedure Code, 1973 ("CrPC") was served upon the Accused on 06.04.2016 to which he pleaded not guilty and opted to contest after disclosing the following defence:
Page 2 of 19
Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 "I do not plead guilty and claim trail. Two cheques were stolen by the complainant and I had not issued any cheque towards any legal liability."
5. Vide order dated 26.05.2016, opportunity was granted to the Accused to cross examine the Complainant. The Complainant/CW1 adopted his pre summoning evidence affidavit Ex. CW1/A and also proved following documents:
Ex. CW1/1: Cheque bearing no. No. 245125 dt.
15.10.2014 drawn on Axis Bank, New Delhi, for an amount of Rs. 10,00,000/-.
Ex CW1/2: Return memo issued by bank dt.
16.10.2014.
Ex. CW1/3: Legal Demand notice dt. 27.10.2014.
Ex. CW1/4: Postal receipt in respect of legal demand notice.
Ex. CW1/5: Tracking report in relation to the legal demand notice sent via speed post.
Ex. CW1/6: Reply of the Accused to the legal demand notice.
Ex. CW1/7: Print out of screenshots of messages between the Complainant and the Accused.
Ex. CW1/8: Certificate u/s 65B in respect of the audio CD and screen shots of messages.
Ex. CW1/9: Audio CD of conversation between Complainant and Accused.
Mark A Copy of passbook of the account of the
(colly): Complainant in State of Bank.
Mark B Copy of passbook of the account of the
(colly): Complainant in Corporation Bank.
Mark C Copy of passbook of the account of the
(colly): Complainant in Bank of Baroda.
Page 3 of 19
Balkishan Sharma v. Dheeraj Kumar Kaushik
CC No 625513/2016
Mark D Copy of sale receipt of Krishi Utpaadan
(colly): Mandi Samiti for month of
August/September 2013.
Mark E Print out of the typed transcription of
(page 1 to 3): audio of talks between Accused and
Complainant.
6. During the cross-examination of the Complainant, the Complainant has also produced as Ex. CW1/10, a certified copy of khatoni of agricultural land situated in Tarora Urf Peepal Gaon (Khair), Aligarh. Complainant Evidence was closed vide separate statement on 26.11.2019. Thereafter, Accused was examined under Section 313 of CrPC for explaining the circumstances appearing against him in the Complainant's evidence. He denied the Complainant's case and pleaded false implication in the present case and opted to lead evidence in his defence.
7. Despite opportunity, Accused did not lead any DE and defence evidence was closed vide separate statement of the Accused on 03.12.2021.
8. I have heard Ld. Counsel for the parties and have perused the case file carefully and meticulously.
Submissions of the Complainant and Accused
9. Complainant has submitted that all ingredients of Section 138 NI Act are fulfilled in the present case and hence, the presumption under Section 139 NI Act arises in the favour of the Complainant, which has not been successfully rebutted by the Accused.
Page 4 of 19
Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016
10.Per contra, Ld. Counsel for the Accused has submitted that the Accused deserves to be acquitted as the cheque in question was stolen by the Complainant, in relation to which a complaint was also lodged with the police and a case was instituted before the Criminal Court. It has been argued that the Complainant did not advance any loan to the Accused and that the Complainant did not have the financial capacity to advance the said loan. Hence, the presumption under Section 139 NI Act stands rebutted. Legal Framework Ingredients of Section 138 NI Act:
11.The Hon'ble Supreme Court of India in Kusum Ingots & Alloys Ltd and Ors v. K Pennar Peterson Securities Ltd and Ors., (2000) 2 SCC 745 ("Kusum Ingots Case"), has clearly stipulated that "the ingredients which are to be satisfied for making out a case under the provision are:
(i) a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account for the discharge of any debt or other liability;
(ii) that cheque has been presented to the bank within a period of six months1 from the date on which it is drawn or within the period of its 1 Reduced to three months vide RBI circular dated 4.11.2011. Page 5 of 19
Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 validity whichever is earlier;
(iii) that cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank;
(iv) the payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within 152 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
(v) the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice;
If the aforementioned ingredients are satisfied then the person who has drawn the cheque shall be deemed to have committed an offence."
12.Therefore, if the aforesaid ingredients are made out, the Accused is deemed to have committed an offence under Section 138 NI Act.
Presumption under Section 139 NI Act/Section 118 NI Act:
13.Section 139 NI Act states that:
2
The same is now enhanced to 30 days.
Page 6 of 19
Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 "Presumption in favour of holder: It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability"
14.Section 139 NI Act is a type of reverse onus clause, which stipulates a presumption in the favour of the Complainant as to fact of a cheque being received in discharge of a legal debt or liability.
15.Further, Section 118(a) of the NI Act, states as follows:
"Presumptions as to negotiable instruments. -- Until the contrary is proved, the following presumptions shall be made:
of consideration --that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration;"
16.The Hon'ble Supreme Court of India has in a number of judgments dealt with the combined effect of the presumptions raised under Section 139 and Section 118(a) NI Act.
17.The following proposition can be summarized on a perusal of the judgments of the Hon'ble Supreme Court of India in Sunil Todi & Ors v. State of Gujarat, LL 2021 SC 706 ("Sunil Todi Case"); Kalamani Tex v. P. Page 7 of 19 Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 Balasubramanian, 2021 SCC OnLine SC 75; APS Forex Services Pvt. Ltd. v. Shakti International Fashion Linkers and Ors. ("APS Forex Case"), AIR 2020 SC 945; Rohitbhai Jivanlal Patel v. State of Gujarat and Ors., AIR 2019 SC 1876; Kumar Exports v. Sharma Carpets, (2009) 2 SCC 513; Basalingappa v. Mudibasappa, (2019) 5 SCC 418; ("Basalingappa Case"); K.N. Beena v. Muniyappan and Anr., (2001) 8 SCC 458; and Dhanvantrai Balwantrai Desai v. State of Maharashtra, 1964 Cri. LJ 437:
(i) Once the execution of cheque is admitted; Section 139 of the NI Act mandates a presumption that the cheque was for the discharge of legally enforceable debt or liability;
(ii) The presumption under Section 139 is a rebuttable presumption and the onus is on the Accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities;
(iii) Something which is probable has to be brought on record by the Accused for getting the burden of proof shifted to the Complainant. To disprove the presumptions, the Accused should bring on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist; Page 8 of 19
Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016
(iv) The words "unless the contrary is proved" which occur in Section 139, make it clear that the presumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible. A fact is said to be proved when its existence is directly established or when upon the material before it the Court finds its existence to be so probable that a reasonable man would act on the supposition that it exists. Unless, therefore, the explanation is supported by proof, the presumption created by Section 139 NI Act cannot be said to be rebutted;
(v) To rebut the presumption, it is open for the Accused to rely on evidence led by him or the Accused can also rely on the materials submitted by the Complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely;
(vi) That it is not necessary for the Accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a persuasive burden.
Analysis
18.In the case at hand, it is not in dispute that the cheque in question was drawn by the Accused from his bank account. Further, it is also not in dispute that the Page 9 of 19 Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 Accused is the signatory of the cheque in question as in the defence disclosed by the Accused U/s 251 CrPC and Section 313 CrPC statement; he has duly admitted the same. Presentation of the cheque in question by the Complainant is also not in dispute.
19.The dishonour of the cheque in question by way of the return memo, Ex. CW1/2, on grounds of Funds Insufficient, is also not in dispute.
20.The Complainant sent the legal demand notice, dated 27.10.2014 (Ex. CW1/3) by way of speed post (Ex. CW1/4), to which a reply Ex. CW1/6, was sent by the Accused. Accordingly, the service of the legal demand notice is also not in dispute. Finally, the complaint has been filed within the limitation period.
21.Finally, the complaint has been filed within the limitation period. Therefore, essential ingredients (i) to (v) as stipulated by the Hon'ble SC in Kusum Ingots Case (supra), have been duly satisfied.
22.Further, as noted above, once the execution of the cheque by the Accused is proved/admitted, the presumption of the same being drawn for consideration stands attracted in terms of Section 139 NI Act. Now, in the case at hand, so far as the question of existence of basic ingredients for drawing of presumption U/s 118 (a) and 139 of the NI Act is concerned, from the aforesaid discussion, it is apparent that the Accused has not denied his signatures on the cheque in question that has been drawn in favour of the Complainant on a bank account maintained Page 10 of 19 Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 by the Accused; and hence the said presumption can be drawn.
23.The Ld. Counsel for the Accused has stated that such inference cannot be drawn as the Accused had not filled the particulars on the cheque and the same would have been filled by or at the instance of the Complainant. At this stage, reliance can be laid on the observations of the Hon'ble SC in Bir Singh v. Mukesh Kumar, (2019) 4 SCC 197; wherein it has been held that:
"It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be attracted...
38. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the Accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence...
40. Even a blank cheque leaf voluntarily signed and handed over by the Accused, which is towards some payment, would attract presumption Under Section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt."
(emphasis supplied) Page 11 of 19 Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016
24.In light of the above, now the onus shifts on the Accused to establish a probable defence so as to rebut such a presumption.
25.In the segment on legal framework, set out above, the legal proposition with respect to the burden of proof upon the Accused has already been discussed. Hence, it is now to be examined as to whether the Accused brought any material on record or pointed out glaring discrepancies in the material produced by the Complainant for dislodging the presumption which meets the standard of preponderance of probabilities.
26.The Accused in the present case, has taken the following line of defence with a view to rebut the presumption:
(a) Loan of Rs. 10,00,000/- was never advanced by the Complainant to the Accused:
27.The Accused in his statement u/s 251 CrPC as well examination u/s 313 CrPC as well as the questions/suggestions put to the Complainant in the cross- examination has submitted that there was no loan transaction between the Complainant and the Accused and cheque in question has been stolen by the Complainant. It has further been argued that there is no written agreement, receipt or any other evidence for the loan transaction and in any case, the Complainant did not have the financial capacity to advance loan of Rs. 10,00,000/- to the Accused; and hence the loan transaction is not proved. Page 12 of 19
Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016
28.Perusal of the complaint as well as the cross-examination of the Complainant shows that the Complainant has not mentioned the details as to exact date of advancement of the loan to the Accused, the date of issuance of cheque in question by the Accused to the Complainant, and/or the source of funds for the advancement of the friendly loan to the Accused.
29.It is a matter of record that no written agreement or receipt was executed between the parties qua the loan transaction. It is also the case of the Complainant that the entire loan transaction was in cash, and no amount was transferred in the bank account of the Accused. The fact of the loan transaction being known to any other person/witness is not mentioned in the complaint/examination in chief. In fact, while the Complainant has in his cross-examination stated that he knew the Accused through the father of the Accused; he has further deposed that he had not told the father of the Accused about the fact of advancement of the said loan to the Accused. Hence, while the case of the Complainant is that a friendly loan was advanced to the Accused, the Accused has refuted the same in his defence u/s 251 CrPC, examination u/s 313 CrPC and cross-examination of the Complainant. The Accused had even replied to the legal demand notice sent by the Complainant and denied the advancement of the loan and alleged the cheque in question was stolen by the Complainant. Despite the reply and the questions put by the Accused in the cross-examination, the Complainant has failed to depose on the relevant details surrounding the loan transaction. In fact, it is not Page 13 of 19 Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 even clear that how and when the loan was advanced. As while in the complaint, the Complainant has not mentioned the date of advancement of the loan, in response to the questions in cross-examination, he has stated that the loan was advanced in cash in August-September 2013. Then he has further stated in the same cross-examination that he had given money to the Accused in July 2013 as well. However, it is not clear from the testimony or the complaint, whether the amount of Rs. 10,00,000 has been advanced in installments or in one go and hence, the statement of the Complainant that he has advanced money in July- August-September 2013, does not by itself clarify the position.
30.Further, the Accused has questioned the financial soundness/capacity of the Complainant to advance an amount of Rs. 10,00,000/-. In response to the questions put in the cross-examination, the Complainant has deposed that he earned income from two sources, namely, his plumbering/electric work and agricultural business. He has further deposed that his annual income was Rs. 7,00,000/- to 8,00,000/- and that in 2013-14, his income was more than Rs. 8,00,000/- per annum. He has also in the cross-examination mentioned that his annual expenses on the (i) education of his children was Rs. 25,2003 in fees and Rs. 50,000-60,000 on miscellaneous education related purposes; (ii) miscellaneous expenses was Rs. 96,000/-.4 Accordingly, as per his own deposition, his annual expenditure was approximately, Rs. 1,81,200. He has 3 Rs. 2100 * 12 (Rs. 2100 being the total monthly fee of his children). 4 Rs. 8,000 * 12 (Rs. 8,000 being the monthly miscellaneous expenditure). Page 14 of 19
Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 further stated that he used to pay approximately Rs. 1,00,000 to the labour as payment for the agricultural business.
31. He has also filed copy of passbooks, Mark A, Mark B and Mark C; perusal of which show his balance in the August 2013, to be around Rs. 72,000 (SBI bank account); Rs. 1,103 (Corporation bank); and Rs. 2387 (Bank of Baroda). Apart from a withdrawal of Rs. 2,85,000/- from the Corporation Bank account on 20.09.2013, none of the other entries in Mark A, B and Mark C show any significant withdrawal of amount by the Complainant, around the time of advancement of loan to the Accused. Hence, Mark A, Mark B and Mark C do not help the Complainant in either bolstering his financial capacity to advance a loan of Rs. 10,00,000/- to the Accused or in evincing the fact of advancement by showing withdrawals etc. In the Basalingappa Case (supra) as well as the APS Forex Case (supra), the Hon'ble SC has noted that when financial capacity to advance the loan is questioned, the burden shifts on the complainant to prove his financial capacity and other facts. In the APS Forex Case (supra), it was noted that:
"We are of the view that whenever the accused has questioned the financial capacity of the complainant in support of his probable defence, despite the presumption under Section 139 of the N.I. Act about the presumption of legally enforceable debt and such presumption is rebuttable, thereafter the onus shifts again on the complainant to prove Page 15 of 19 Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 his financial capacity and at that stage the complainant is required to lead the evidence to prove his financial capacity, more particularly when it is a case of giving loan by cash and thereafter issuance of a cheque."
32.Undisputedly, the present case relates to a cash loan given on friendly terms and is a case where the financial capacity of the Complainant has been questioned by way of questions put in the cross-examination by the Accused. However, the Complainant has only given evasive replies and without further details as to the source of funds for the loan, it does not seem probable for a reasonable man whose annual income is Rs. 8,00,000/- and annual expenditure is around Rs. 2,81,000/- to advance a loan of Rs. 10,00,000/- in cash without any receipt/written acknowledgment to another person, and to not remember the details of such a big loan amount. Further, the Complainant has in his cross- examination dt. 02.08.2019 also deposed that "I do not remember any date or month when the accused has issued me a cheque."
33.Further, while the case of the Complainant is that he had friendly terms with the Accused and hence, the loan was advanced, he has pleaded ignorance with respect to the designation of the Accused in the MAX insurance company, despite admitting to have worked in the same company as an insurance agent. It is trite law that the conduct has to be viewed/ascertained from the point of view of a reasonable man (reliance is placed on judgment in Kumar Exports Case (supra)) and that the case of the Complainant is required to stand on its own Page 16 of 19 Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 legs, despite the weakness in the defence of the Accused. Seen against this light, there are several inconsistencies and unexplained/unsubstantiated claims in the case of the Complainant, which do not inspire confidence from the point of view of a reasonable man. Further, reliance cannot be placed on (i) Mark E, as the same has admittedly been prepared by the Complainant himself and not attested by a transcript professional; (ii) Ex. CW1/7, as the same admittedly does not disclose the phone number with which the conversation took place and a reasonable doubt as to the identity of the persons in the conversation has been raised; (iii) Ex. CW1/9, as the same has not been proved to the satisfaction of this Court, in light of absence of identification of the voices. Admittedly, the main device, i.e., the phone from which the aforesaid conversations emanated, is not in the possession of the Complainant and print outs have been taken out from the cyber café and the certificate has been given by the Complainant, who has in cross-examination dt. 13.08.2018, admitted that he is a computer illiterate and does not have any printer/computer at his home. Accordingly, the certificate u/s 65B Indian Evidence Act, 1872, Ex. CW1/8 is not in accordance with the requirements of law and hence, cannot be relied upon.
34.Per contra, the Accused has submitted that the cheque in question along with another cheque bearing no. 245126, were kept as blank signed cheques in his drawer and the same have been stolen by the Complainant and misused. He has stated that the Complainant was his junior in Max Life Insurance and has stolen Page 17 of 19 Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 the cheques at that point of time. The Accused has consistently taken this stand throughout the trial. It is seen that the same defence has been taken by the Accused in his reply to the legal demand notice and he has, upon receiving intimation of the dishonour of the cheque, lodged a complaint with the SHO and has also filed a criminal case. The Complainant in his cross-examination dt. 02.08.2019, has also stated that he is aware that a complaint was filed by the Accused against him. The copy of the criminal complaint was even attached by the Accused to his application u/s 145(2) NI Act.
35.In his cross-examination dt. 02.08.2019, the Complainant has accepted that he was used to work as a life insurance agent at Max Life Insurance and that he used to go to the office of the Accused. Accordingly, the Accused has created a probable doubt in the case of the Complainant, after which the burden shifted to the Complainant to prove his case beyond all reasonable doubt.
36.However, in light of the aforesaid discussion, the Complainant has failed to discharge his burden of proving the guilt of the Accused beyond all reasonable doubt.
Conclusion
37.In these circumstances and in view of the above detailed discussion, this court is of the considered opinion that the Accused has successfully rebutted the presumption under Section 139 of Negotiable Instruments Act, 1881 and the Page 18 of 19 Balkishan Sharma v. Dheeraj Kumar Kaushik CC No 625513/2016 ingredients of Section 138 of Negotiable Instruments Act, 1881 do not stand proved. Therefore, Accused, DHEERAJ KUMAR KAUSHIK is held not guilty and is acquitted of the offence punishable under Section 138 of the Negotiable Instrument Act, 1881.
ORDER: ACQUITTED
Announced in Open Court (Twinkle Chawla)
23.05.2022 MM (NI-Act 02), South East
Saket Court, New Delhi
Note: This judgment contains 19 pages and each page has been signed by me.
(Twinkle Chawla) MM (NI-Act 02), South East Saket Court, New Delhi Page 19 of 19