Delhi District Court
Samara India Pvt. Ltd. vs . Rajesh Sharma & Anr. on 2 November, 2019
IN THE COURT OF MS. DEEPALI SRIVASTAVA: MM (N.I.ACT):
SOUTH-EAST DISTRICT, SAKET COURTS COMPLEX: NEW DELHI
Samara India Pvt. Ltd. Vs. Rajesh Sharma & Anr.
CC No.620968/16
U/s 138 Negotiable Instruments Act, 1881
1. CIS number : 620968/16
2. Name of the complainant : M/s Samara India (P) Ltd.
B-35, Lajpat Nagar II,
New Delhi-110024
Also at:
B-24, Okhla Industrial Area,
Phase I, New Delhi,
New Delhi-110020.
3. Name of the accused , : 1. Rajesh Sharma
parentage & residential AR for M/s Ramjidas Motors
address Pvt. Ltd.,
119-C, 3/07, Lane No.3,
Anupam Gardens, Sainik Farms,
New Delhi-110068.
2. M/s Ramjidas Motors Pvt.
Ltd.,
119 C, 3/07, Lane No.3,
Anupam Gardens, Sainik Farms,
New Delhi-110068.
4. Offence complained of or : U/s 138 of Negotiable
proved Instruments Act, 1881
5. Plea of the accused : Pleaded not guilty and
claimed trial
6. Final Judgment/order : Acquitted
7. Date of judgment/order : 02.11.2019
Date of Institution : 23.03.2011
Date of Reserving Judgment/Order : 25.06.2019
Date of Pronouncement of Judgment/Order : 02.11.2019
CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
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JUDGMENT
1. By way of the present Judgment, this court shall dispose off the present complaint filed by M/s Samara India Pvt. Ltd (hereinafter referred to as 'complainant') against Rajesh Sharma & Anr. (hereinafter referred to as 'accused') u/s 138 of Negotiable Instruments Act, 1881 r/w Section 142 Negotiable Instruments Act, 1881 (hereinafter referred to as 'N.I. Act' in short).
Brief facts:
2. It is the case of the complainant, that the complainant is a private limited company and the authorised dealer of Hyundai Motor India Pvt. Ltd which is engaged in the business of marketing, sales and service of Hyundai make cars. As per the complainant case, accused no.1 had approached the complainant workshop at B-24, Okhla Industrial Phase I, New Delhi for repair of two vehicles bearing registration number HP14A 1820 and HP14A 2168 owned by Silverline Motors Pvt. Ltd. The motor vehicles as mentioned above were duly repaired by the complainant and the invoices were raised for the repair cost. In order to pay the repair charges, accused no.1 Rajesh Sharma had issued the cheque in question of accused no.2 Ramjidas Motors Pvt. Ltd to discharge the legal liability of Silverline Motors Pvt. Ltd. Accused no.1 had issued one cheque bearing no.521112 dated 09.01.2011 for the amount of Rs.2,96,614/- drawn on Indusind Bank, Nehru Place, New Delhi-110019, with the assurance that the same will be duly CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 2 of 16 encashed upon presentation before the bank but, to the uttershock to the complainant, when the complainant presented the above mentioned cheque for encashment at his bank at Kotak Mahindra Bank, Okhla Phase II Branch, New Delhi, the same was dishonoured vide return memo dated 11.01.2011 with remarks 'Payment Stopped by Drawer'.Thereafter, becoming aware of the fact of dishonour of his cheque, accused no.1 issued a letter to the complainant alleging that the accused persons were not satisfied with the services provided by the complainant and as such, they were not liable to pay anything to the complainant. Thereafter, aggrieved with the conduct of the accused, complainant sent a legal notice dated 09.02.2011 u/s 138 NI Act, calling upon the accused to make the payment within 15 days of the receipt of the legal notice as prescribed u/s 138 of the N.I. Act. Even after the expiry of 15 days stipulated period, the accused did not make the payment as required by the legal demand notice, hence,the present case was filed by the complainant. Proceedings before the Court:
3. After perusing the complaint and hearing the arguments of the complainant on the point of summoning of the accused, prima facie it appeared that the offence U/s 138 NI Act,has been committed. Hence, cognizance of the offence u/s 138 NI Act was taken against accused no.1 Rajesh Sharma and accused no.2 M/s Ramjidas Motors Pvt. Ltd on 02.04.2011 and summons were issued to accused.
CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
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4. Notice u/s 251 Cr.P.C. was framed against accused no.1 and 2 on 09.02.2012, to which they pleaded not guilty and claimed trial. Thereafter, an application u/s 145(2) NI Act, was allowed by the Ld. Predecessor and the case proceeded as summons case. However, despite given ample opportunity, no cross examination of the complainant was conducted and hence, vide order dated 12.01.2015, complainant evidence was closed. Statement of accused no.1 and 2 u/s 313 Cr.PC was recorded on 27.01.2015 wherein the accused persons had opted not to lead any defense evidence, hence, the case was fixed for final arguments. Thereafter, an application u/s 311 Cr.PC was filed on behalf of the complainant for examination of complainant witnesses which was allowed on 22.09.2015 and the matter again proceeded to complainant evidence. Complainant evidence pursuant to application u/s 311 Cr.PC was duly conducted and was closed on 07.11.2016. Thereafter, an application u/s 315 Cr.PC was allowed and accused was given an opportunity to examine himself as a defense witness. However, again despite given ample opportunities, no defense evidence was led by the accused on multiple dates and hence, vide order dated 25.01.2019, opportunity to lead defense evidence was closed and the matter was listed for final arguments. Final arguments were heard on behalf of the complainant on 22.02.2019. In the meanwhile, accused had preferred a revision petition before the Ld. Sessions. The revision petition was received back by the court being dismissed by the Ld. Sessions. As there was a change of CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 4 of 16 Presiding Officer, the case was again listed for final arguments for the just decision. Final arguments were heard on behalf of the complainant on 25.06.2019 with the liberty to the accused to file the written arguments within 15 days. However, no such written arguments have been filed on behalf of the accused till date.
Evidence:
5. To prove its case, complainant has examined his AR as CW1 and has led his evidence by way of affidavit Ex. CW1/A and relied upon the following documents:-
(a) Copy of Board Resolution Ex. CW1/1.
(b) Original cheque and return memo Ex. CW1/2 (colly).
(c) Original Legal Notice sent by the accused Ex. CW1/3 (colly.)
(d) Legal notice along with speed post receipt and tracking report Ex.CW1/4 (colly.)
6. The accused has not examined any witness nor has relied upon any documentary evidence in his defense. Despite, given the opportunity accused has not lead any defense evidence.
Arguments of both parties:
7. Final arguments were heard on behalf of the complainant on 25.06.2019. However, accused was given liberty to file written arguments within 15 days. The same has not been filed by the accused.
8. Ld. counsel for the complainant while re-iterating the contents of the complaint has argued that all the CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 5 of 16 requirements of Section 138, N.I. Act have been fulfilled by the complainant in the present case. He argued that the cheque in question Ex.CW1/2 of accused no.2 was issued by the accused no.1 towards the payment of the repair charges of the vehicles of Silverline Motors Pvt. Ltd, hence towards the legally enforceable liability of the accused. He further argued that when the cheque was presented before the bank for encashment, the same was dishonoured on presentation vide return memo Ex.CW1/2 dated 11.01.2011 for reasons 'Payment Stopped By Drawer'. Thereafter the legal notice u/s 138 NI Act Ex.CW1/3 dated 09.02.2011 was sent to the accused to make the payment within 15 days stipulated period, but no payment was made by the accused. Thus, all the ingredients of section 138 NI act, have been duly satisifed and thus presumption u/s 139 NI Act, has been validly raised against the accused. Ld. Counsel submits that the accused has failed to raise any probable defence to disprove the case of complainant and to rebut the presumption u/s 139 NI Act. Therefore, accused be convicted for the offence u/s 138 NI Act.
9. Before deciding the present complaint case, lets consider the legal provisions. For fastening liability u/s 138 Negotiable Instruments Act following are the requirements:-
(a) Drawing of the cheque by the person on the account maintained by him.
(b) Drawer of the cheque issued the cheque to discharge in whole or in part, any legal enforceable debt or other CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 6 of 16 liability.
(c) The cheque issued has been returned unpaid due to insufficiency of funds or exceeds the arranged amount.
(d) The drawer fails to make payment within stipulated time after the receipt of demand notice.
Further Section 118 Clause (a) of Negotiable Instruments Act provides for presumptions regarding the consideration for the Negotiable Instruments. It reads as under: -
"That every negotiable instrument was made or drawn for consideration and that every such instrument when it has been accepted, endorsed, negotiated or transferred was accepted, endorsed, negotiated or transferred for consideration".
Section 146 of Negotiable Instruments Act reads as under:- "The court shall, in respect of every proceedings under this chapter on production of bank's slip or memo having thereon official mark the denoting that the cheque has dishonoured, presume the fact of dishonour of such cheque, unless and until such fact is disproved."
Section 139 of the Negotiable Instruments Act provides for presumption in favour of a holder. It reads as under:-
"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, or any debt or other liability."
The combined reading of above said sections raises a presumption in favour of the holder of the cheque that he CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 7 of 16 has received the same for discharge in whole or in part of any debt or other liability. However, it is settled principle of law that the presumption available u/s 139 Negotiable Instruments Act can be rebutted by the accused by raising a probable defence but the burden of proof is on the accused.
Reasons for Decision:
10. Coming to the present case in hand, the complainant has relied upon the cheque Ex.CW1/2, dishonor memo Ex.CW1/2, legal notice Ex.CW1/4 to support his case. The complainant has duly proved all the ingredients of section 138 NI, Act. Also, as the signature and the fact of giving the cheque in question to the complainant has been admitted by the accused, the presumption u/s 139 and u/s 118 (a) has been raised against the accused which says that S.139. "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, or any debt or other liability." and S. 118(a) "That every negotiable instrument was made or drawn for consideration and that every such instrument when it has been accepted, endorsed, negotiated or transferred was accepted, endorsed, negotiated or transferred for consideration".'
11. Now, it is upon the accused to displace this presumption on a scale of preponderance of probabilities and the lack of CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 8 of 16 consideration or a legally enforceable debt but it 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. This, the accused can do either by leading own evidence in his defence or even by punching holes within the case of the complainant in cross examination.
The accused has to come forth with a convincing defence that appeals to common sense & basic rationality. Only in a case where the accused comes up with a convincing defence to counter liability, that the presumption can be stated to have been rebutted.
12. The accused in his plea of defence u/s 251 Cr.PC has stated that he is not liable to pay anything to the complainant towards the cheque in question as the cheque in question was given to the complainant as a security with the understanding that the same has to be presented before the bank only upon an intimation by the accused for presenting the same after he was satisfied with the services provided by the complainant. He further took a plea that the services provided by the complainant were not upto the mark and as such, he was not satisfied with the repair work done by the complainant. Accused has also disputed the receipt of legal demand notice, as alleged to be sent by the complainant. The CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 9 of 16 same defense has been disclosed by the accused during his statement u/s 313 Cr.PC.
13. Considering the plea and the statement of the accused, it comes to the fore that the accused has taken three fold defense. First, that he has not received any legal demand notice as alleged to be sent by the complainant, secondly, that the cheque in question was given as a security cheque to the complainant and not meant to be encashed till accused was satisfied with the services and thirdly, that he was not liable to pay anything to the complainant towards the cheque in question as the complainant has not satisfactorily completed the repair work on the two vehicles which were sent to his work shop, as such he was not under any legal enforceable liability towards the complainant.
14. Coming to the first defense of the accused, accused has disputed the receiving of legal notice by him, but he has nowhere disputed the correctness of the address on which the legal notice was sent to him. In CC Alavi Haji Vs. Palapetty Mohammad and Anr. (2007) 6SCC 555 it has been held that Section 27 of the General Clauses Act gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. It was further held as follow:
"any drawer who claims that he did not receive the notice sent by post, can, within 15 days receipt of the summons from the court in respect of the complaint u/s 138 of the Act, make payment of the cheque amount and submit to the court that he had made payment within 15 days CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 10 of 16 of the 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 complaint u/s 138 of the Act cannot obviously content that there was no proper service of notice as required u/s 138, by ignoring statutory presumption to the contrary under Section 27 of the General Clauses Act and Section 114 of the Evidence Act. In our view, any other interpretation of the proviso would defeat the very object of the legislation."
Hence, in light of above settled proposition of law, the legal notice is deemed to be duly served upon the accused.
15. It is the second defense of the accused, that the cheque in question was a security cheque which was to be presented before the bank by the complainant, only after the intimation by him. He further disclosed in his statement u/s 313 Cr.P.C that the cheque had to signed by two authorised persons, not one and this information was disclosed to the complainant, but despite this, the cheque was presented by the complainant before the bank. The same fact has been corroborated by CW-2, who was examined under 311 Cr.P.C after the defense evidence was closed. It is the main defense of the accused that though both the vehicles were sent to the workshop of the complainant, but no repair work was done by the complainant, rather the vehicles were kept for 534 days in the workshop, which was beyond the usual time. Since, the vehicles were not functioning properly despite being in the workshop for over two years, hence the instruction for stop payment was given by him to his bank.
CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
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16. During the cross examination of the CW-1, it has been disclosed by the CW-1 that as a usual course of business, the complainant company used to take the signature of the customers on the repair order to mark the customer's satisfaction for the repair order. However, to show such satisfaction in the present case, no repair order has been placed by the complainant. CW-1 also admitted that the accused had sent a letter dated 18.01.2011 wherein, he had complained for the repair work done by the complainant. To show that the complainant company had satisfactorily completed the repair work, CW-1 stated that before taking the delivery of the vehicle, accused had taken the test drive, however at the same time, he admitted to the fact, that he had never repaired any vehicle personally but only used to supervise the repairing team.
17. The letter placed on record by the complainant dated 18.01.2011 clearly reflects that the accused was not satisfied by the repair work done by the complainant, and had highlighted that despite leaving the vehicle for over two years in the workshop, instead of improvement, the vehicle had deteriorated. He had also acknowledged the fact that since the repair work was not done to the mark, he was not liable to pay anything to the complainant, rather due to the deteriorated state of the vehicles, complainant need to reimburse him for the loss and the inconvenience caused to him. This letter dated 18.01.2011 is way before the legal notice and the present case, hence the same was issued CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 12 of 16 before the cause of action arosed in the present case.
Also, the date of the cheque in question is 09.01.2011 and the return memo is 11.01.20111, and the remarks are 'payment stopped ', hence had it been the case that the accused had malafidely given the cheque with single signature, then the accused would had not issued the stop payment instruction to the bank. Thus, considering the chain of events and the evidences led by the parties, the version of the accused seems probable .
18. The standard of proof required from the complainant is on scale of beyond reasonable doubt, whereas the accused is required to establish his defense on the scale of preponderance of probabilities. The accused has not led any evidence to prove his defense but it does not have any repercussion, as it is not necessary for the accused to come in witness box in support of his defense. Section 139 NI, Act imposes evidentiary burden on accused, not persuasive burden as been held in Basalingappa v Mudibassapa (2019 SCC
491). It has also been held in Rangappa v Sri Mohan (2010)11 SCC 441 that accused can rebut the presumption u/s 139 NI, Act on preponderance of probabilities.
19. In the present facts of the case, in absence of any document that were required to be produced by the complainant to show as to what repair works were made by the complainant, or the signed invoice to show the satisfaction of work by the accused, the version of the complainant case CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 13 of 16 becomes questionable.
20. In Bharat Barrel & Drum Manufacturing Company v Amin Chand Payrelal (1999) 3 SCC 35 it was laid down as under:
The defendant can prove the non-existence of a consideration by raising a probable defence. If the defendant is proved to have discharged the initial onus of proof showing the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the plaintiff who will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to the grant of relief on the basis of the negotiable instrument."
In Krishna Janardhan Bhat Vs. Dattatraya V. Hegde 2008 Crl.L.J. 1172, the Hon'ble Supreme Court has held that for proving the defence, accused is not required to step into the witness box and need not to examine himself. He may discharge his burden on the basis of the material already brought on records as he has a constitutional right to maintain silence. Standard of proof on the part of an accused and that of the prosecution in a criminal case is different. Court also held that prosecution must prove the guilt of an accused beyond all reasonable doubt, the standard of proof so as to prove a defence on the part of an accused is 'preponderance of probabilities'. 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 he relied. It was also held that where the chances of false implication cannot be ruled out, the background fact and the conduct of the parties together with their legal requirements are required to be taken into consideration. Hon'ble Supreme Court also cautioned that the courts must be on guard to see that merely on the application of presumption as contemplated under CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 14 of 16 Section 139 of N.I. Act, the same may not lead to injustice or mistaken conviction.
21. Therefore, in view of the above discussion, in the opinion of this court, the accused has succeeded in rebutting the presumption of legal liability by exposing the inherent infirmities in the case of the complainant. Also, the chain of events starting from the date of issue of the cheque, to issuing stop payment instructions by the accused including sending of letters dated 18.01.2011 and 08.03.2011 to the complainant completes the chain of events which go on to corroborate the version of the accused. However, in the absence of any documentary or oral evidence to show as to what repair works were done by the complainant and the accused has given his satisfaction towards the repair work, the believability quotient of the complainant's case has been diluted.
Conclusion:
22. From the above said facts, in the thoughtful opinion of this court, accused has succeeded to rebut the presumption raised against him u/s 139 N.I. Act and as per settled law once accused has raised a probable defense creating reasonable doubt about the existence of legally enforceable liability the onus shifts to complainant to prove that cheque was issued by the accused towards a legally enforceable debt or liability, which the complainant has failed to discharge. Hence, accused No.1, Rajesh Sharma and CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
page 15 of 16 accused No.2, M/s Ramjidas Motors Pvt. Ltd are acquitted for the offence u/s 138, N.I. Act.
Announced in the open court (DEEPALI SRIVASTAVA)
on 02.11.2019 MM(N.I. Act):SED:
Saket Courts, New Delhi
CC No.620968/16 M/s Samara India (P) Ltd. VS. Mr. Rajesh Sharma & Anr.
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