Delhi District Court
Sushil Kr. Sharma vs Abhay Kr. Singh on 5 March, 2024
IN THE COURT OF MS. AAKANKSHA, METROPOLITAN
MAGISTRATE, (NI ACT)-07
SOUTH-WEST DISTRICT, DWARKA COURTS, NEW
DELHI
Ct. Case No.23735/2018
CNR No. DLSW02-023789-2018
Sushil Kumar Sharma .........Complainant
Through: Mr. Hanish Sehrawat, Advocate
Versus
Abhay Kumar Singh ..........Accused
Through: Mr. A.K. Mishra, Advocate
(1) Name of the Sushil Kumar Sharma
complainant
S/o Sh. Radhey Shyam
Sharma
R/o H.No.D-702, The
Navsanjivan CGHS, Plot
no.1, Sector 12,
Dwarka,Delhi.
(2) Name of the accused Abhay Kumar Singh
S/o Sh. Mohan Singh
R/o 170, Block E, JJ
Colony, Bindapur, Uttam
Ct. Case No.23735/2018 Digitally signed
by
Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA
Page 1 of 29 AAKANKSHA Date:
2024.03.05
14:57:51 +0530
Nagar, New Delhi.
Also at:- B-89, Second
Floor, Gali no.4, New Janki
Puri, Budh Bazar Road,
New Delhi-59.
Also at:- B-107, New Janki
Puri, Budh Bazar Road,
New Delhi-59.
Also at:- Red Rose
International D-86, Near
Water Tank, Udyog Vihar,
Phase-6, Sector 36,
Gurgaon, Haryana-122001.
(3) Offence complained of Section 138 Negotiable
or proved Instruments Act, 1881
(4) Plea of accused Pleaded not guilty
(5) Date of institution of 14.06.2018
case
(6) Date of conclusion of 23.02.2024
arguments
(7) Date of Final Order 05.03.2024
(8) Final Order ACQUITTAL
JUDGMENT
1. The complainant Sushil Kumar Sharma has instituted this complaint u/s 138 Negotiable Instruments Act, 1881 Digitally signed Ct. Case No.23735/2018 by Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA Page 2 of 29 AAKANKSHA Date: 2024.03.05 14:57:59 +0530 (hereinafter referred to as 'NI Act') against accused Abhay Kumar Singh on 02.06.2018.
2. The factual matrix as can be culled out from the complaint is that accused used to borrow loan from complainant at previous occasions and thus complainant gained trust. Accused again borrowed a loan of Rs.7,50,000/- from complainant in last week of November, 2017 on account of financial problems and to develop his business of E-Battery Rickshaw and promised to repay the same within a period of four months. In discharge of his legal liability, accused issued one post dated cheque bearing no.000019 dated 11.04.2018 for a sum of Rs.7,50,000/- drawn on Andhra Bank, Branch Janak Puri, Delhi (cheque in issue) with assurance of its encashment upon presentation. At the time of issuing the cheque in question, the accused also gave direction to fill the cheque in question and on the direction of accused, the complainant filled up the cheque in question and thereafter the accused signed the same after receiving the payment. However, to the complainant's dismay the said cheque was returned unpaid with remarks "Payment stopped by drawer" vide return memo dated 13.04.2018. The complainant then issued a legal notice dated 04.05.2018 calling upon the accused to pay the cheque amount within 15 days from the receipt thereof, but the accused failed to make the payment thus constraining the complainant to file this complaint u/s 138 Negotiable Instruments Act, 1881 (hereinafter referred to as 'NI Act') seeking redress against the dishonor of the cheque in question.
Ct. Case No.23735/2018Sushil Kumar Sharma Vs. Abhay Kumar Singh Digitally signed by AAKANKSHA Page 3 of 29 AAKANKSHA Date:
2024.03.05 14:58:04 +0530
3. With a view to establish a prima facie case in order to enable the court to summon the accused, complainant led pre- summoning evidence by way of affidavit Ex. CW-1/A. The complainant relied upon following documentary evidence:
(a) Copy of ID proof of the complainant, which is Ex.CW1/1(OSR).
(b) Copy of ID proof of accused, which is Mark A.
(c) Copy of visiting card of accused, which is Mark B.
(d) Original cheque bearing no.000019 dated 11.04.2018 for a sum of Rs.7,50,000/- drawn on Andhra Bank, which is Ex.CW1/4.
(e) Return memo dated 13.04.2018, which is Ex. CW-1/5.
(f) Office copy of legal notice, which is Ex. CW-1/6.
(g) Postal and courier receipts, which are Ex.CW1/7(colly).
(h) Delivery report, which are Ex.CW1/8(colly).
(i) Bank statement of bank account of the firm of complainant, which is Ex.CW1/9.
Complainant closed his pre-summoning evidence on 05.06.2018.
4. On the basis of above material and finding a prima facie case made out against the accused, the accused was summoned vide order dated 05.06.2018. Accused entered his first appearance on 25.02.2020.
Digitally signed byCt. Case No.23735/2018 AAKANKSHA
Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA Date:
Page 4 of 29 2024.03.05
14:58:10 +0530
5. Notice u/s 251 Cr.P.C. was framed against accused on 18.04.2022 stating out to him the substance of accusation, to which he pleaded not guilty and claimed trial. His defence was recorded at the stage of framing of notice in compliance of directions passed by Hon'ble High Court of Delhi in Rajesh Aggarwal v. State 171 (2010) DLT 51. The accused took defence that the cheque in issue bears his signature but the other details were not filled by me, he gave cheque in issue to the complainant but did not receive legal notice although it bears his correct address, he did not take loan of Rs.7,50,000/- from complainant, cheque was taken by complainant in a blank signed manner when he borrowed Rs.80,000/-, he repaid Rs.75,000/- by cheque and Rs.30,000/- by cash, complainant has misused the cheque, when he asked for return of his cheque complainant told him that he had torn the same, he also issued legal notice to complainant.
6. Accused was granted right to cross-examine the complainant on oral prayer made u/s 145(2) NI Act by accused vide order dated 20.07.2022. The complainant was examined as CW-1 thereby adopting his pre-summoning evidence as post-summoning evidence and was duly cross-examined and discharged. Vide separate statement of complainant, complainant evidence was closed on 18.10.2022.
Digitally
signed by
AAKANKSHA
Ct. Case No.23735/2018 AAKANKSHA Date:
Sushil Kumar Sharma Vs. Abhay Kumar Singh 2024.03.05
Page 5 of 29 14:58:16
+0530
7. Statement of accused was recorded u/s 313 Cr.P.C. r/w section 281 Cr.P.C. on 18.11.2022 wherein all the incriminating evidence was put to the accused and he was granted an opportunity to explain the circumstances appearing against him at trial. While explaining the circumstances appearing in evidence against him, accused stated without oath that the cheque in issue bears his signature but he did not fill the remaining particulars, he did not receive legal notice and already shifted from the address mentioned on the notice in 2017, he only borrowed Rs.80,000/- from complainant through account transfer but does not remember the date or year, at the time of taking loan he handed over blank signed cheque to complainant and also signed some blank papers, he repaid Rs.75,000/- by cheque to complainant and remaining Rs.5,000/- by cash, when he asked for return of his cheque complainant stated that he has torn the cheque, then he sent complainant a legal notice for return of cheque. Accused preferred to lead evidence in his defence.
8. At the stage of defence evidence, accused examined himself as DW1 and relied upon copy of notice dated 27.02.2018, which is Mark X. He was duly cross-examined and discharged. Accused also examined witness from post office ie. DW2 Bhupender Singh and bank witness ie. DW3 Ravinder Kumar Mishra. DW2 was not cross examined by complainant despite opportunity. DW3 was duly cross examined and discharged. Vide separate statement of accused, defence evidence stood closed on 29.11.2023. Digitally Ct. Case No.23735/2018 signed by AAKANKSHA Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA Date:
Page 6 of 292024.03.05 14:58:21 +0530
9. At the stage of final arguments, Ld. counsel for complainant submitted that the signature on the cheque and its issuance is admitted fact, the legal notice has been sent to the correct address of accused, the accused only took defence of taking loan of Rs. 80,000/- and cheque being for security of that loan, but during cross-examination of complainant it came on record that there were many loans borrowed by accused from complainant which corroborates the pleadings of complainant, accused took contrary defence of three cheques being given as security whereas in his plea of defence he took defence of only one security cheque, further the legal notice sent by accused mentions seven cheques, postal receipt has been later amended to write word 'Deep Enclave' in pen and without the proper address the notice would never reach complainant, thus notice sent by accused was never received by complainant, statement u/s 313 Cr.P.C. disclose return of Rs.
30,000/- in cash by accused whereas in plea of defence accused stated to have returned Rs. 30,000/- in cash, in his defence accused deposed that he have 4 security cheques to complainant for one loan and three security cheques for another loan but no police complaint was ever filed by accused for non-return of his cheques or misuse of his cheques, accused gave stop payment of only four cheques including the cheque in issue and no reason was given by accused for not stopping the payment of all seven cheques if seven security cheques were given to complainant and prayed to convict the accused.
Digitally signed byCt. Case No.23735/2018 AAKANKSHA Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA Date:
Page 7 of 29 2024.03.0514:58:27 +0530
10. Per contra, Ld. counsel for accused submitted that in his pleadings complainant stated that accused approached him in last week of November 2017 for loan and in the same month he gave loan to accused but in cross-examination CW-1 deposed that accused was asking for loan 4-5 months prior to giving loan to accused, the loan was given in cash, there is no document or proof of loan or proof of source of money, CW-1 admitted that accused repaid the earlier loan, complainant was unable to depose the date when he advanced loan to accused, the cheque was also admittedly filled by complainant, the particulars in the cheque and the signature are filled with different ink, as per government rule one cannot pay in cash more than Rs. 20,000/-, accused also sent notice to complainant and has also filed postal receipt but tracking report could not be filed, although accused stopped the payment of only four cheques but the question here is whether the cheque in issue was included in those four cheques, the debt has to be enforceable, admission of earlier debt cannot be admission of present debt and prayed to acquit the accused.
11. After hearing the arguments advanced on behalf of both the parties and perusing the record carefully, the appreciation of evidence and findings of the court are as below.
12. It would be apposite to first consider the legal position serving as base to the offence underlying Section 138 NI Act. The Ct. Case No.23735/2018 Digitally signed Sushil Kumar Sharma Vs. Abhay Kumar Singh by Page 8 of 29 AAKANKSHA AAKANKSHA Date:
2024.03.05 14:58:33 +0530 following legal requirements need to be satisfied in order to constitute an offence u/s 138 NI Act, as held by Hon'ble Supreme Court in the case titled as Kusum Ingots & Alloys Ltd. v. M/s Pennar Peterson Securities Ltd.: (2000) 2 SCC 745:
(i) that 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 the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity whichever is earlier;
(iii) that the 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) that 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 thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
(v) that 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 Ct. Case No.23735/2018 Digitally signed by Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA Page 9 of 29 AAKANKSHA Date: 2024.03.05 14:58:39 +0530 notice;
The above legal requirements are cumulative, meaning thereby that only if all the aforementioned ingredients are satisfied can the person who had drawn the cheque be held liable for offence u/s 138 NI Act.
13. Burden of proof: The claim based under the provisions of Negotiable Instruments Act is an exception to the general rule of law that burden of proof lies on the prosecution. The two specific provisions viz. Section 118 (a) and 139 of NI Act contemplates that a presumption is attached in regard to each and every negotiable instrument that the same was drawn and issued against due discharge of the liability and thus, whenever any claim is made on the basis of a negotiable instrument, the presumption has to be drawn in favour of the holder of the cheque (drawee) and the law has put the burden to rebut the presumption on the accused that the cheque was not issued by him against discharge of a debt or a liability. In case, the accused is not able to rebut the presumption and fails to prove his defence, the presumption becomes absolute and it has to be assumed that the cheque was issued by the accused in discharge of debt or liability and consequently, accused is assumed guilty of the offence. It was held by Hon'ble Supreme Court in the case of Rangappa v. Mohan: 2010 (11) SCC 441 that presumption of Section 139 of N.I. Act also includes the existence of legally enforceable debt: Digitally signed by Ct. Case No.23735/2018 AAKANKSHA Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA Date:
Page 10 of 29 2024.03.0514:58:44 +0530
14. In light of these extracts, we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability.
Hon'ble Supreme Court, in the case of Hiten P. Dalal v. Bratindranath Banerjee: 2001 (6) SCC 16 held that the presumption mentioned in the section 139 NI Act is a presumption of law and not a presumption of fact and thus, this presumption has to be drawn in favour of the drawee and the burden to rebut the presumption with the probable defence is on the accused.
This is indeed an instance of the rule of 'reverse onus', where it is incumbent on the accused to lead what can be called 'negative evidence' i.e. to lead evidence to show non-existence of liability. Keeping in view that this is a departure from the cardinal rule of 'presumption of innocence' in favour of the accused and that negative evidence is not easy to be led by its very nature, it is now settled that the accused can displace this presumption on a scale of preponderance of probabilities and the lack of consideration or a legally enforceable debt need not be proved to the hilt or beyond all reasonable doubts. The accused can either prove that the liability did not exist or make the non-existence of liability so probable that a reasonable person, ought under the circumstances of the case, act on the supposition that it does not exist. He can do so either by leading own evidence in his defence or even by punching holes in the case of the complainant in the testing ordeal of cross-examination. This Digitally signed by AAKANKSHA Ct. Case No.23735/2018 Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA Date:
2024.03.05 Page 11 of 29 14:58:51 +0530 can be deciphered from relevant para no.21 of Hiten P. Dalal (supra):
21. In other words, provided the facts required to form the basis of a presumption of law exist, no discretion is left with the Court but to draw the statutory conclusion, but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary. A fact is said to be proved when, "after considering the matters before it, the Court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists". Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the Court in support of the defence that the Court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the 'prudent man'.
Further, in Bharat Barrel v. Drum Manufacturing:
AIR 1999 SC 1008 Hon'ble Supreme Court held that the accused has to rebut the presumption and mere denial of passing of consideration is no defence. It is, thus, clear that in cases of Section 138 NI Act, upon proof of foundational facts, law presumes in favour of drawee that the cheque was issued by the accused in discharge, wholly or in part, of legally enforceable debt or liability and the burden to rebut the same is upon the accused. The burden does not have to be conclusively established but the accused has to prove his defence on preponderance of probability.
14. Now applying the above law to the facts of the present case, it has to be adjudged whether the legal requirements laid down hereinabove have been fulfilled in the instant case.
Digitally Ct. Case No.23735/2018 signed by AAKANKSHA Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA Date:
Page 12 of 29 2024.03.0514:58:56 +0530 14.1. The first legal requirement is:
"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."
At the outset, it has to be proved that the accused had issued the cheque in question on his account maintained with a bank for discharge of any debt or other liability. In the instant case, accused has admitted his signatures on the cheque in question in his statement recorded u/s 313 Cr.P.C. and in notice framed u/s 251 Cr.P.C. The cheque in question has also been drawn on the account maintained by him with Andhra Bank. The said fact has not been denied by accused at any stage of proceeding.
It was held in the case of Kalamani Tex & anr. v. P. Balasubramanian: 2021 SCC Online SC 75 Hon'ble Supreme Court held that:
"14. Adverting to the case in hand, we find on a plain reading of its judgment that the trial court completely overlooked the provisions and failed to appreciate the statutory presumption drawn under Section 118 and Section 139 of NI Act. The statute mandates that once the signature(s) of an accused on the cheque/negotiable instrument are established, then these 'reverse onus' clauses become operative. In such a situation, the obligation shifts upon the accused to discharge the presumption imposed upon him."
The above said principle has also been crystallized by Hon'ble Supreme Court in the case of Basalingappa v. Mudibasappa:
(2019) 5 SCC 418, by observing that:
"25. We having noticed the ratio laid down by this Court in above cases on Sections 118(a) and 139, we now summarize Ct. Case No.23735/2018 Sushil Kumar Sharma Vs. Abhay Kumar Singh Digitally signed by Page 13 of 29 AAKANKSHA AAKANKSHA Date:
2024.03.05 14:59:02 +0530 the principles enumerated by this Court in following manner:
(i) Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other 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) To rebut the presumption, it is open for the accused to rely on evidence led by him or 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.
(iv) 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.
(v) It is not necessary for the accused to come in the witness box to support his defence."
14.2. In the instant case, the accused having admitted his signature on the cheque in question and the said cheque being drawn on his bank account, a mandatory presumption automatically arises in favour of complainant by virtue of Section 118(a) r/w 139 NI Act that the cheque in question was issued by him in discharge of, whole or part of, legally enforceable debt or liability.
14.3. Now the burden shifts upon accused to rebut the above presumption by raising a probable defence, by leading evidence or bringing such facts on record in the cross-examination of the complainant that could make the latter's case improbable. If, in such Ct. Case No.23735/2018 Digitally signed Sushil Kumar Sharma Vs. Abhay Kumar Singh by Page 14 of 29 AAKANKSHA AAKANKSHA Date:
2024.03.05 14:59:07 +0530 a case, the accused is proved to have discharged the initial onus of proof placed on him by showing that the existence of consideration was improbable or doubtful or illegal, then the onus will again shift back to the complainant who will then be under an obligation to prove it as a matter of fact and failure to do so will disentitle him to any relief on the basis of the negotiable instrument (as held in Satish Sharma v. State NCT of Delhi & anr.: (2013) 204 DLT
289).
14.4. The accused has chosen to do so by cross-examining the complainant witnesses and by leading evidence in his defence. During cross-examination CW-1/complainant deposed, in brief, that earlier he was having business of corrugated boxes and at present he is doing business of property dealer/commission agent, accused used to visit his office for business purpose of Red Rose International Firm, he used to supply goods to the said firm even before he came into contact of accused, he was introduced to accused by his neighbour Adesh Kumar, he did not visit the house of accused prior to giving loan, he has no family relation with accused, he never took any blank signed cheque as security from accused before the present loan, he did not take any blank signed cheque/stamp papers/blank signed papers from accused in 2016 while giving loan of Rs.80,000/-, he gave loan of Rs.80,000/- in cash, accused has already repaid the said amount, he also gave loan to the accused after loan of Rs.80,000/- and before the present loan of Rs.7.5 Lakhs, he transferred Rs.1,04,800/- to the account of Ct. Case No.23735/2018 Digitally signed Sushil Kumar Sharma Vs. Abhay Kumar Singh by Page 15 of 29 AAKANKSHA AAKANKSHA Date:
2024.03.05 14:59:13 +0530 accused on 25.01.2017 but never took any blank signed paper or stamp paper and if any cheque was taken by him, it would be for the amount of loan only and he did not take any blank signed cheque, accused has already repaid Rs.1,04,800/-, his monthly income was Rs.1.5-2 Lakhs at the time of advancing of the present loan, he advanced the loan in three parts in cash, some cash was withdrawn from the bank, he does not remember the exact date of advancement of loan but it was in November 2017, accused was asking for loan for 4-5 months prior to actual advancement of loan, he does not have any documentary proof of loan, he received cheque in question at the time of advancement of loan and it was filled up by him and signed by accused at that time only, there is difference in ink on the cheque, he did not disclose the loan in his ITR, his office address is RZ-155, Part-I, Gali no.8 Deep Enclave, Vikas Nagar, Delhi but the address of G-2/115 Sai Enclave Mohan Garden Uttam Nagar is not his address, he did not receive legal notice sent by accused and the word 'Deep Enclave' on the postal receipt is written by hand later on and if the notice was posted without the word 'Deep Enclave' it would never reach him as Vikas Nagar is a separate area and Deep Enclave Vikas Nagar is a separate area, he never visited the house of accused after dishonor of cheque but he visited the house of accused once and at his shop twice prior to presentation of cheque but accused was not found at his house, accused was found at his shop, the second time he went with his wife to the house of accused, he told the accused that he is presenting the cheque if the payment is Digitally signed by AAKANKSHA Ct. Case No.23735/2018 AAKANKSHA Date:
Sushil Kumar Sharma Vs. Abhay Kumar Singh 2024.03.05 Page 16 of 29 14:59:19 +0530 not made, loan was given in his office and no one was present at that time except him and accused.
14.5. Accused examined himself as DW-1 and deposed, in brief, that complainant used to supply cartons to Red Roses International in which he was also working, thus he came to know the complainant, he borrowed friendly loan of Rs.80,000/- from complainant but does not remember the date or year, he handed over 4 blank signed cheques as security to complainant, he has already repaid Rs.75,000/- through cheque in 2016 and Rs.5,000/- in cash, he again borrowed Rs.1,04,800/- in 2016-2017 and issued three blank signed cheques as security to complainant, he has already repaid the entire amount but complainant did not return his cheques despite demand, complainant told him that he would tear away the cheques, thereafter he gave stop payment instructions qua all the 7 cheques and also issued notice to complainant for return of cheques which is Mark X. During cross examination, accused deposed, in brief, that he did not lodge any complaint regarding non return of cheques, he was in the repairing work of e-rickshaw, his visiting card is already Mark B, proof of stop payment instructions is Mark B1 (colly) and postal receipt of sending legal notice to complainant is Mark C (colly), there is no description of cheques in the legal notice, at first instance he handed over four cheques to complainant and then he handed over three cheques but he does not remember correctly as long time has passed, he issue cheques serial wise from his cheque book, both the cheque leaves in Mark D1 are from two Ct. Case No.23735/2018 Digitally signed Sushil Kumar Sharma Vs. Abhay Kumar Singh by AAKANKSHA Page 17 of 29 AAKANKSHA Date: 2024.03.05 14:59:28 +0530 different cheque books, first four cheques were given from the first cheque book and then three cheques were given from another cheque book but both the cheque books belong to the same bank account, he did not issue any legal notice when complainant did not return his cheques despite return of first loan taken in 2016, Mark D1 does not mention number of cheques qua which stop payment instructions were issued.
14.6. Accused examined officer assistant from post office Bhupinder Singh/DW-2 who placed on record letter issued by senior superintendent of post office (Ex.DW2/1) and deposed that the record has been weeded out and therefore no proof of service of notice Mark C could be given. The witness was not cross examined despite opportunity. Since the witness failed to file any tracking report qua sending of notice by accused to complainant, the testimony of the said witness does not hold significance to the defence of accused.
14.7. Accused also examined Branch Manager of Union Bank of India, Ravinder Kumar Mishra/DW-3 who placed on record stop payment instruction qua cheque no. 000019 (Ex.DW3/1 Colly).
During cross-examination, DW-3 deposed that no reason was given by accused for issuing stop payment instruction, stop payment instruction was given for total four cheques bearing no. 000019 till Digitally Ct. Case No.23735/2018 signed by AAKANKSHA Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA Date:
Page 18 of 29 2024.03.0514:59:34 +0530 000022, cheque no.000001 to 000025 as reflected at page no.3 of Ex.DW3/1 belongs to the same cheque book.
14.8. From the perusal of testimonies of both the parties, the following facts are admitted: One, that accused and complainant were known to each other and accused used to borrow loan from complainant even prior to the advancement of alleged loan. Second, that the cheque in issue was handed over by accused to complainant with signatures of accused and the same was filled by complainant. Third, accused borrowed a sum of Rs. 80,000/- from complainant on 02.06.2016 and duly returned the same. Fourth, accused again borrowed a sum of Rs. 1,04,800/- from complainant on 25.01.2017 and duly returned the same. Now the facts disputed are that the complainant has alleged that he again gave a sum of Rs. 7,50,000/-
to accused in November 2017 for repayment of which accused gave the cheque in issue to him at the same time. Whereas it is defence of accused that he did not borrow Rs. 7,50,000/- from complainant, instead he gave cheque in issue in blank signed manner (alongwith three other blank signed cheques) to complainant as security at the time of borrowing of earlier loan of Rs. 80,000/- but despite repayment complainant did not return his cheques stating them to have been torn by him, and later misused the same. The accused has been successful in raising a probable defence which is discussed hereinbelow.
Digitally signed by AAKANKSHA AAKANKSHA Date:
Ct. Case No.23735/2018 2024.03.05
Sushil Kumar Sharma Vs. Abhay Kumar Singh 14:59:40
Page 19 of 29 +0530
14.9. To begin with, there is no proof of advancement of loan. Proving the advancement of loan becomes significant in the facts of the case where accused has specifically denied borrowing huge sum of Rs. 7,50,000/- from complainant and has also proved from the statement of firm of complainant that he already repaid the earlier loans which were advanced to him through banking mode. The financial capacity of complainant was also challenged by accused but complainant has filed the bank account statement of his firm (Ex. CW-1/9) which proves that complainant's firm, if not complainant, had sufficient balance and the same account was even involved in lending money to accused at previous occasions. However, the same statement raises a doubt that when earlier the loan was always advanced to accused through banking mode and not cash, why the alleged loan which was of a much higher sum was advanced to accused in cash.
14.10. The statement of account of firm of complainant (Ex. CW-1/9) reflects advancement of Rs. 80,000/- to accused on 02.06.2016 and Rs. 1,04,800/- on 25.01.2017. It also reflects repayment of Rs. 75,000/- by accused on 21.12.2016. Accused has also relied upon a legal notice (Mark C) sent to complainant wherein he has called upon complainant to return his cheques and documents alleging that complainant took four blank signed cheques from accused at the time of advancing Rs. 80,000/- and three blank signed cheques at the time of advancing Rs. 1,04,800/- but at the time of repayment of both the said loans, complainant gave the same Ct. Case No.23735/2018 Digitally signed Sushil Kumar Sharma Vs. Abhay Kumar Singh by Page 20 of 29 AAKANKSHA AAKANKSHA Date:
2024.03.05 14:59:44 +0530 excuse for not returning the security cheques that they were torn and the blank signed documents were misplaced, that earlier accused did not suspect any foul play but when the same excuse was given by complainant at the time of repayment of loan of Rs. 1,04,800/- accused suspected foul play and sent this notice to complainant. Although complainant has denied having received the said notice and has also disputed his address on the same, but accused has filed a postal receipt duly proving that the said notice was actually dispatched on 28.02.2018 and was not an afterthought. Also, complainant has not disputed his second address to which the legal notice was addressed and only raised a doubt that if the words 'Deep Enclave' were added only after posting the notice, it would never reach complainant. However, there being no proof of inclusion of the word 'Deep Enclave' as an afterthought, it is presumed that the notice being correctly addressed to complainant, would have been delivered to complainant by invoking Section 27 of General Clauses Act. Accused was cross-examined by complainant to prove that the notice (Mark C) does not contain description of the cheques. However, non-disclosure of cheque number in the said notice does not hamper the defence in as much as the notice refers to all the cheques and documents taken by complainant from accused at the time of advancement of loan of Rs. 80,000/- and Rs. 1,04,800/-. Further, the date of issuing stop payment instructions and dispatching the said notice is the same.
Digitally
signed by
AAKANKSHA
Ct. Case No.23735/2018 AAKANKSHA Date:
Sushil Kumar Sharma Vs. Abhay Kumar Singh 2024.03.05
Page 21 of 29 14:59:50
+0530
14.11. Accused has also stepped into the witness box to prove his defence and deposed that he issued stop payment instruction to his banker qua the cheque in issue. Bank witness DW-3 also proved the same vide letter Ex. DW-3/1(colly.). The payment of cheque in issue was stopped upon instruction of accused on 28.02.2018.
Further, it reflects that payment of four cheques (cheque no. 19 to
22) were stopped by accused, which further strengthens the defence taken by accused that four cheques were taken as security by complainant at the time of advancement of Rs. 80,000/- to accused. The mere fact that accused did not issue stop payment of other three cheques which he alleges to have given to complainant as security for a subsequent loan of Rs. 1,04,800/- does not weaken the defence in as much as the question to be adjudicated in the present case is whether or not accused acted as a prudent person in stopping the payment of cheque in issue when it was not returned to him. Thus, accused has proved that once he suspected foul play, he acted as a prudent person in stopping the payment of the cheque in issue on 28.02.2018 and in demanding the cheque from complainant vide notice dispatched on the same day i.e. 28.02.2018.
14.12. Complainant also admitted in his cross-examination that the cheque in issue was given to him at the time of advancement of loan and that accused only signed the same, which again is coherent with defence of accused that complainant used to take security cheque from accused at the time of advancement of loan. To add further, complainant has given contradictory statement Ct. Case No.23735/2018 Digitally signed Sushil Kumar Sharma Vs. Abhay Kumar Singh by AAKANKSHA Page 22 of 29 AAKANKSHA Date: 2024.03.05 14:59:55 +0530 regarding the period when accused approached him for alleged loan. In his pleadings, complainant alleged that accused approached him in last week of November 2017 for loan of Rs. 7,50,000/- and he advanced the said sum to accused in the same month, whereas in his cross-examination CW-1 deposed that he advanced Rs. 7,50,000/- to accused in three parts in cash, some cash was withdrawn from the bank, he does not remember the exact date of advancement of loan but it was in November 2017 and accused was asking for loan for 4- 5 months prior to actual advancement of loan. Complainant also admitted not reflecting the alleged loan in his ITR. Although the same is no ground in itself to infer that no loan was advanced to accused but this fact assumes significance in the facts of the present case where accused has laid down a cogent defence and complainant has been unable to prove the alleged loan. Complainant also deposed that at the relevant time his earning was only Rs. 1.5-2 lacs, but filed the account statement of his firm to show his lending capacity. The said account statement itself raises a doubt whether a huge sum of Rs. 7,50,000/- was actually lent to accused. The earlier lending only amounted to small sum of Rs. 80,000/- or Rs. 1,04,800/-. All these lending were through proper banking channel that too from the account of complainant's firm. The repayment is also admitted by CW-1 and part repayment of Rs. 75,000/- is also reflected in the same statement Ex. CW-1/9, and remaining payment is stated to have been made in cash by accused which has been duly accepted by CW-1. Thus, when the complainant was always advancing money to accused only through his firm's account that Digitally Ct. Case No.23735/2018 signed by Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA Page 23 of 29 AAKANKSHA Date: 2024.03.05 15:00:00 +0530 too a small sum, lending of huge sum of Rs. 7,50,000/- to accused that too in cash and without any proof becomes doubtful in view of defence taken by accused. It also becomes doubtful in view of admission of complainant that he did not have any family relations with accused and never visited the house of accused prior to advancing loan to accused. It further becomes doubtful in view of complainant's own admission vide visiting card of accused (Mark B) which shows that accused was only dealing in repairing work of e-rickshaw. Thus, what prompted the complainant in giving a huge sum of Rs. 7,50,000/- in cash to accused without charging any interest, without there being any family relations amongst them and without there being any proof of the same, remains unexplained.
14.13. The burden was upon accused to rebut the legal presumption, on the test of probability, and raise a probable defence which would convince the court that the cheque was not issued towards legal liability of accused. The standard of probability was that of a prudent person only. Considering the facts as observed hereinabove in light of defence of accused in stopping the payment of cheque by accused and simultaneous issuance of notice to complainant for return of cheques, it can be safely held that accused has been able to prove prima facie that the cheque in question was not issued in discharge of his legal liability. Thus, accused has been able to successfully rebut the presumption of law and discharge the burden of proof by raising a probable defence that the cheque in question was not issued to complainant in discharge of his liability.
Ct. Case No.23735/2018 Digitally signed Sushil Kumar Sharma Vs. Abhay Kumar Singh by Page 24 of 29 AAKANKSHA AAKANKSHA Date: 2024.03.05 15:00:06 +0530
The first legal requirement is, thus, proved in favour of accused and against the complainant.
15. The second legal requirement is:
"That cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity whichever is earlier."
The cheque in question Ex. CW-1/4 is dated 11.04.2018. The cheque returning memo Ex. CW-1/5 is dated 13.04.2018, which proves that the cheque in question was presented within the period of its validity. Further, defence has failed to controvert the said fact.
Thus, the second legal requirement is adjudicated in favour of complainant.
16. The third legal requirement is:
"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."
Section 146 NI Act presumes the fact of dishonour of cheque upon production of bank's slip or memo having the official mark denoting that the cheque in question has been dishonoured. This is also a rebuttable presumption and the upon production of Digitally signed by Ct. Case No.23735/2018 AAKANKSHA Sushil Kumar Sharma Vs. Abhay Kumar Singh AAKANKSHA Date:
Page 25 of 29 2024.03.0515:00:10 +0530 such bank memo, the burden shifts upon accused to disprove the same.
It was held in Laxmi Dyechem v. State of Gujarat: (2012) 13 SCC 375 that:
"15. ... We find ourselves in respectful agreement with the decision in NEPC Micon Ltd. (supra) that the expression "amount of money .......... is insufficient" appearing in Section 138 of the Act [NI ACT] is a genus and dishonour for reasons such "as account closed", "payment stopped", "referred to the drawer" are only species of that genus. Just as dishonour of a cheque on the ground that the account has been closed is a dishonour falling in the first contingency referred to in Section 138, so also dishonour on the ground that the "signatures do not match" or that the "image is not found", which too implies that the specimen signatures do not match the signatures on the cheque would constitute a dishonour within the meaning of Section 138 of the Act."
In the instant case, a presumption has been raised in favour of complainant by virtue of Section 146 NI Act that the cheque in question was dishonored for the reason stated therein viz. payment stopped by drawer. As held in Laxmi Dyechem (supra) dishonour of cheque with the remarks "payment stopped by drawer" also fall within the offence u/s 138 NI Act and therefore, the burden now shifts upon the accused to rebut this presumption by establishing some reasonable justification for the same. But the accused has admitted his signature on the cheque in question.
Thus, the third legal requirement is adjudicated in favour of complainant.
Digitally signed by AAKANKSHACt. Case No.23735/2018 AAKANKSHA Date:
Sushil Kumar Sharma Vs. Abhay Kumar Singh 2024.03.05
Page 26 of 29 15:00:16
+0530
17. The fourth legal requirement is:
"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 thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid."
In the instant case, the cheque in issue was returned dishonoured on 13.04.2018. The complainant sent a legal notice dated 04.05.2018 (Ex. CW-1/6) addressed to the accused. Speed post receipt dated 04.05.2018 (Ex. CW-1/7) are also on record, which proves that the legal notice was sent within the prescribed period. Accused has although denied receiving the legal notice and has also stated to have left the said address in 2017 itself. However, the said statement cannot be believed in light of his own legal notice Mark C. The legal notice Mark C was sent by accused to complainant on 28.02.2018 incorporating his address of B-89, Jankipuri, Gali No.4, New Delhi, which is also one of the addresses to which the legal notice Ex. CW-1/6 sent by complainant has been addressed. Thus, it can be said that the legal notice was properly addressed to the correct address of accused and by virtue of presumption u/s 27 General Clauses Act accused is deemed to have received the legal notice, if the notice has been sent to correct address by post.
17.1. Even otherwise, law expects a person pleading non- receipt of any demand notice to prove his bona fide by making the payment of the cheque amount within 15 days of receiving court Ct. Case No.23735/2018 Digitally signed Sushil Kumar Sharma Vs. Abhay Kumar Singh by Page 27 of 29 AAKANKSHA AAKANKSHA Date:
2024.03.05 15:00:20 +0530 summons. This is crystallized by the verdict of Hon'ble Supreme Court in the case titled as C.C. Alavi Haji v. Palapetty Muhammed & anr.: (2007) 6 SCC 555:
"17. It is also to be borne in mind that the requirement of giving of notice is a clear departure from the rule of Criminal Law, where there is no stipulation of giving of a notice before filing a complaint. Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under section 138 of the Act, make payment of the cheque amount and submit to the Court that he had made payment within 15 days of receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the Court along with the copy of the complaint under section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under section 138, by ignoring statutory presumption to the contrary under Section 27 of the G.C. Act and section 114 of the Evidence Act."
17.2. In the case at hand, despite issuance of summons and appearance of accused before the court, accused has failed to pay the cheque amount to the complainant and thus is precluded from raising the plea of non-service of demand notice. Thus, it is proved that the legal notice was sent to accused within thirty days of receipt of intimation of dishonor of cheque in issue.
The fourth legal requirement is, thus, adjudicated in favour of complainant.
Digitally
signed by
AAKANKSHA
Ct. Case No.23735/2018 AAKANKSHA Date:
Sushil Kumar Sharma Vs. Abhay Kumar Singh
Page 28 of 29
2024.03.05
15:00:25
+0530
18. The fifth legal requirement is:
"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."
It is an undisputed fact and also a matter of record that the accused has failed to make the payment till date let alone making payment within 15 days of receipt of notice.
Thus, the fifth legal requirement is adjudicated in favour of complainant.
19. All the legal requirements constituting an offence u/s 138 NI Act being cumulative in nature, the fact that the first legal requirement has not been proved in favour of complainant, the ingredients necessary to bring home the guilt of accused remain incomplete. Accordingly, accused Abhay Kumar Singh is acquitted for the alleged offence u/s 138 NI Act.
Digitally signed by AAKANKSHAAnnounced in the open AAKANKSHA Date: 2024.03.05 court on 05.03.2024. 15:00:32 +0530 (Aakanksha) Metropolitan Magistrate(NI Act)-07 South West District, Dwarka Courts, New Delhi Ct. Case No.23735/2018 Sushil Kumar Sharma Vs. Abhay Kumar Singh Page 29 of 29