Delhi District Court
Religare Finvest Ltd vs Dhirender Jain on 8 June, 2012
IN THE COURT OF SH.NAVJEET BUDHIRAJA, METROPOLITAN MAGISTRATE,
SPECIAL COURT06, DWARKA COURTS, NEW DELHI.
RELIGARE FINVEST LTD
VERSUS
DHIRENDER JAIN
P.S.: KALKAJI
U/S: 138 NEGOTIABLE INSTRUMENTS ACT
1. Serial No./CC No. of the case : 24864/09
2. Name of the complainant : Religare Finvest Ltd.
19, Nehru Place,
New Delhi - 110 019
3. Date of institution : 21.12.2009
4. Name of the accused, his : Dhirender Jain Prop. M/s Jain
parentage and residence Traders
At:
House Number - 22, Raza Bazar
Jain Mandir
Delhi - 110001
Also At:
44, Nehru Bazar, Paharganj,
Delhi110002
5. Date when judgment was : 23.05.2012
reserved
6. Date when judgment was : 08.06.2012
pronounced
7. Offence complained of and : Section 138 Negotiable Instruments
proved Act
8. Plea of accused : Pleaded not guilty and claimed trial
9. Final Judgment : Accused is acquitted for the offence
CC.No.24864/09 Page no. 1 of 12
under Section 138 Negotiable
Instruments Act.
:J U D G M E N T:
1 Vide this judgment, I shall decide the present complaint filed by
the complainant Religare Finvest Limited under Section 138 of Negotiable
Instruments Act (hereinafter referred to as NI Act) against the accused Dhirender Jain.
2 Factual matrix of the case is that complainant is a public limited company having its registered and corporate office at New Delhi and is dealing with the business of providing its customers various types of loan facilities. It is averred that accused Dhirender Jain, proprietor of M/s Jain Mandir has availed the loan facility under Loan Account Number 22778 and towards the discharge of part debts accrued on account of dues on the complainant company, the accused issued cheque bearing number 487311 dt. 07.08.2009 respectively amounting to Rs.21,696/ which when presented by the complainant with its banker for encashment was returned unpaid by the drawee bank with the returning memo dt. 22.10.2009 for the reason "Account Closed".Thereafter, complainant through its counsel served a legal demand notice to the accused on 04.11.2009 through UPC Post, Speed Post & Courier Service calling upon him to make the payment of the dishonoured cheque. It is further averred that despite service accused failed to make the payment of the cheque amount demanded through the legal notice thereby committing offence under Section 138 of NI Act for the prosecution of which the present complaint has been filed.
CC.No.24864/09 Page no. 2 of 12 3 After taking cognizance of the offence summons were issued to
the accused post which he entered appearance and was admitted to bail on 02.09.2010.Thereafter, notice under Section 251 Criminal Procedure Code, 1973 (for short Cr.p.c) encompassing all the accusations against the accused was served upon him to which he pleaded not guilty and specified his defence.Thereafter matter got fixed for defence evidence.
4 In the meanwhile, application under Section 145 (2) of the N.I.Act was filed on behalf of the accused for recalling the complainant witness i.e the AR of the complainant stating the grounds of defence which was allowed and matter got fixed for cross examination of the complainant. 5 Before proceeding with the cross examination, complainant substituted its Authorized Representative (for short AR) and the new AR Sh. Indra Kant Jha tendered his evidence by way of affidavit which is Ex.CW1/1.Other documents relied upon by CW1 are power of attorney Ex.CW1/B1, cheques Ex.CW1/C, returning memo Ex.CW1/D, legal notice Ex.CW1/E, postal receipts are Ex.CW1/F1 and Ex.CW1/G4.In cross examination, CW1 deposed that he was appointed in this company on 14.03.2012 as Authorized Representative, legal department. He admitted that the entire transaction pertaining to the present loan i.e. the execution of the loan documents, handing over of the cheques etc. was not conducted in his presence. He further stated that accused availed of Rs.6 lakhs as personal loan from the complainant but no loan agreement was filed on record. He further stated that the tenure of the loan was 36 months and each installment was of Rs.21,691/.He further stated that till date accused has repaid approximately Rs.2,32,000/ to the complainant towards the loan. He further stated that the mode of CC.No.24864/09 Page no. 3 of 12 repayment of the loan was through post dated cheques. He admitted that there is no acknowledgment on record regarding service of the legal notice. He admitted that there was no returning memo of the Central Bank which was the bank on which cheque in question was drawn but volunteered that the cheque in question was presented for encashment in the Bank of the complainant i.e. HDFC Bank and the returning memo of the same was on record. He admitted that the returning memo Ex. CW1/D was neither signed nor stamped by the banker of the complainant. He voluntarily stated that since the memo was computer generated therefore, it did not require any signature. He denied the suggestion that Ex.CW1/D i.e. returning memo was a forged and fabricated. He admitted that Ex. CW1/E i.e. legal notice does not bear the signatures of complainant. He voluntarily stated that the same was sent through and signed by the lawyer of the complainant. He admitted that there was no statement of account on record but stated that he can file the same and the statement of account was Ex. CW1/S (colly).He admitted that there was no signature on any of the pages of said statement of account. He denied the suggestion that the cheque in question was one of the 56 cheques given as blank for security purpose at the time of the loan. Lastly, he further denied that he was deposing falsely. Complainant's evidence got closed vide order dt. 09.04.2012. 6 Complainant's evidence was followed by Statement of Accused U/s 313 Cr.PC r/w 281 Cr.PC, wherein accused admitted to have availed a loan of Rs. 6 Lacs from the complainant. Regarding the issuance of the cheque in question, he stated the cheque in question bears his signature but he have neither filled the date nor the amount and the cheque was given for security purpose. Accused further stated that he did not receive any legal demand notice from the complainant and his residential address is H.No.22, Jain Mandir, Raja Bazar, Delhi CC.No.24864/09 Page no. 4 of 12 and M/s Jain Traders, 44 Nehru Bazar, Paharganj, New Delhi is his shop address which he had closed in January 2009.Lastly, he stated that he had already made the payment towards his liability and the cheque in question was given as security cheque which was misused by the complainant. Accused chose not to lead any defence evidence.
7 Learned counsel for the complainant Sh. L.M Grover and learned counsel for the accused from legal aid Sh. Kamal Dave addressed their respective final arguments at length.Before appreciating the evidences and arguments of both the parties, it would be appropriate to advert to the relevant provisions of N.I Act.
Section 138 of N.I Act reads as under
138 Dishonour of cheque for insufficiency, etc., of funds in the account where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement make with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for a term which may extend to twice the amount of the cheque or with both.
Provided that nothing contained in this section shall apply unless CC.No.24864/09 Page no. 5 of 12
(a) The cheque has been presented to the bank within a period of six months from the date on which it was drawn or within the period of its validity, whichever is earlier.
(b) The payee or the holder in due course of the cheque, as the case may be, 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; and
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque, within 15 days of the receipt of the said notice.
Explanation - For the purposes of this section, "debt or other liability" means a legally enforceable debt or other liability.
8 Section 138 of the NI Act has three ingredients, viz., (i) that there is a legally enforceable debt; (ii) that the cheque was drawn from the account of bank for discharge in whole or in part of any debt or other liability which pre supposes a legally enforeceable debt; and (iii) that the cheque so issued had been returned due to insufficiency of funds. The proviso appended to the said section provides for compliance of legal requirements before a complaint petition can be acted upon by a court of law.
9 I would now embark on the evidences and rival contentions advanced by counsel of the parties and give my findings thereon.
CC.No.24864/09 Page no. 6 of 12 10 Learned counsel for complainant reiterated the facts as are
mentioned in the complaint and also contended that accused has failed to lead any evidence to prove that cheque in question was a blank signed security cheque.It is also contended that cheque was an EMI cheque which fact has not been rebutted by the accused and accused has also failed to rebut the presumptions under section 118 and 139 of N.I Act in favour of the complainant. In retort, learned counsel for the accused has contended that complainant has failed to prove the legally enforceable debt or liability and the statement of account filed by the complainant is also unsigned and hence inadmissible and same is the case with return memo showing the factum of dishonour which is neither signed nor stamped hence no offence is made out under section 138 of N.I Act.
11 Before embarking upon the other issues raised by both the parties, let me advert to the issue of alleged dishonour of cheque Ex CW1/C vide return memo Ex CW1/D with remarks account closed which is sine qua non for the prosecution of offence under section 138 of N.I Act.
12 It is the averment in the complaint and the affidavit of the complainant witness that cheque was presented by the complainant with its banker HDFC Bank Ltd which was returned unpaid by the drawer's banker alongwith return memo dated 22.10.09 for the reason "Account Closed".Counsel for the accused has assailed the validity of the said return memo by asking questions to the complainant witness in his cross examination. Relevant extract of cross is as follows:
".....It is correct that there is no returning memo of the Central Bank which is the bank on which cheque in question is drawn.Vol: The cheque in question was CC.No.24864/09 Page no. 7 of 12 presented for encashment in the bank of the complainant i.e HDFC Bank and the returning memo of the same is on record.It is correct that the returning memo Ex CW1/D is neither signed nor stamped by the banker of the complainant.Vol: since the memo is computer generated therefore it does not require any signature.It is wrong to suggest that Ex CW1/D returning memo is a forged and fabricated."
13 Reading of the aforesaid extract manifests two things firstly that return memo is not of the bank (Central Bank) on which cheque is drawn, secondly return memo is neither signed nor stamped and thirdly, the memo is computer generated. Now the requirement of section 138 of N.I Act is that the cheque is to be presented and returned unpaid by the drawee bank. The return memo Ex CW1/C pertains to the banker of the complainant HDFC bank and not to the drawee bank but this thing can be explained on the basis that now a days cheque is not physically sent to the drawee bank for collection instead its image is sent through CTS system and the presenting bank then gives the report in the form of its own memo. But then in that case the memo issued by the presenting bank has to comply with the mandatory requirements of section 146 of N.I Act which is as follows:
146. Bank's slip prima facie evidence of certain facts.
The Court shall, in respect of every proceeding under this Chapter, on production of bank's slip or memo having thereon the official mark denoting that the cheque has been dishonoured, presume the fact of dishonour of such cheque, unless and until such fact is disproved.
14 So, section 146 of NI Act has made the mere production of bank slips/memo having thereon the official mark denoting that the cheque has been CC.No.24864/09 Page no. 8 of 12 dishonoured to establish the factum of dishonour of such cheques. Therefore, it does not seem to be necessary for the complainant to summon the concerned official of the bank to prove such bank's slip/memo. The complainant may prove it by its mere production. But in the present case, this presumption cannot be raised as there is no official mark to prove the factum of dishonour. Legal position is settled that mere production and marking of a document as exhibit by the Court cannot be held to be a due proof of its contents. Its execution has to be proved by admissible evidence that is by the evidence of those persons who can vouchsafe for the truth of the facts in issue. Now the next question is what if the memo is computer generated and does not require any signature. If the memo is computer generated then it is admissible in evidence only when the requirements of the Evidence Act/Bankers Books Evidence Act are complied with. In the complaint in hand, going by the evidence on record, I find that complainant has not cared to satisfy the conditions under section 65B(2).Neither Ex.CW1/C contains a certificate as contemplated under section 65B(4) of Indian Evidence Act nor the person who took out the print copy was examined.
15 To fortify my view , I would like to place reliance on the latest Judgment if Kerala High Court in A.M Perumal v. Star Tours and Travels (India) Ltd 2011 (2) , RCR Civil 371 wherein it has been held that electronic record would be admissible in evidence only if the record produced satisfies the conditions laid down under section 65B(2) and contains a certificate as contemplated by section 65B(4) of Evidence Act. A reading of section 65B would be relevant:
65B.Admissibility of electronic records: CC.No.24864/09 Page no. 9 of 12
1) Notwithstanding anything contained in this Act, any information contained in an electronic record which is printed on paper, stored, recorded or copied in optical or magnetic media produced by a computer ( hereinafter referred to as the computer output) shall be deemed to be also a document, if the conditions mentioned in this section are satisfied in relation to the information and computer in question and shall be admissible in any proceedings, without further proof or production of the original, as evidence of any contents of the original or of any fact stated therein of which direct evidence would be admissible.
2) The conditions referred to in subsection (1) in respect of a computer output shall be the following namely:
a) the computer output containing the information was produced by the computer during the period over which the computer was used regularly to store or process information for the purpose of any activities regularly carried on over that period by the person having lawful control over the use of the computer;
b) during the said period, information of the kind contained in the electronic record or of the kind from which the information so contained is derived was regularly fed into the computer in the ordinary course of the said activities;
c) throughout the material part of the said period, the computer was operating properly or, if not, then in respect of any period in which it was not operating properly or was out of operation during that part of the period, was not such as to affect the electronic record or the accuracy of its contents; and
d) the information contained in the electronic record reproduces or is derived from such information fed into the computer in the ordinary course of the said activities.
4) In any proceedings where it is desired to give a
CC.No.24864/09 Page no. 10 of 12
statement in evidence by virtue of this section, a certificate doing any of the following things, that is to say.
a) identifying the electronic record containing the statement and describing the manner in which it was produced;
b) giving such particulars of any device involved in the production of that electronic record as may be appropriate for the purpose of showing that the electronic record was produced by the computer;
c) dealing with any of the matters to which the conditions mentioned in subsection (2) relate, and purporting to be signed by a person occupying a responsible official position in relation to the operation of the relevant device or the management of the relevant activities (whichever is appropriate) shall be evidence of any matter stated in the certificate; and for the purposes of this subsection it shall be sufficient for a matter to be stated to the best of the knowledge and belief of the person stating it.
16 So, from the foregoing discussion it is manifest that complainant has failed to prove the dishonour memo Ex CW1/C of cheque Ex CW1/B, therefore, complaint of the complainant fails on the aspect of proving the dishonour of the cheque which is indispensable for the prosecution of the present complaint.
17 In the light of the aforesaid narration, I consider it futile to embark upon other issues raised by both the parties since complainant has failed to prove the factum of dishonour of the cheque Ex CW1/B vide returning memo Ex CW1/C which is one of the pivotal ingredients of the offence under section 138 of N.I Act, hence no offence under section 138 of N.I Act is made CC.No.24864/09 Page no. 11 of 12 out against the accused Dhirender Jain and consequently he is acquitted of the same and is set at liberty. Bail bonds, if any stands discharged.
ANNOUNCED IN THE OPEN (NAVJEET BUDHIRAJA)
COURT ON 08.06.2012 METROPOLITAN MAGISTRATE
SPECIAL COURT 06,
DWARKA COURTS, DELHI.
CC.No.24864/09 Page no. 12 of 12