Delhi District Court
Complainant vs Sh K B Sharma on 15 November, 2018
IN THE COURT OF MS. UPASANA SATIJA, MM03 (NI ACT)
SOUTHWEST DISTRICT: NEW DELHI
C.C. No. 50066322016
CNR No.: DLSW020159982016
Under Section 138 of Negotiable Instruments Act, 1881
In the matter of :
Sh Suraj Paswan
S/o Sh. Jugeshwar Paswan
R/o C7, Vikas Nagar Extension,
B & C Block, Vikas Nagar,
New Delhi.
Complainant
Versus
Sh K B Sharma
S/o Sh. P.C. Sharma
R/o C349, Vikas Puri,
New Delhi110018. Accused
Offence complained of / proved : Under Section 138
Negotiable Instruments Act,
1881.
Plea of the accused : Pleaded not guilty
Date of Institution : 07.12.2016
Final Order / Judgment : Convicted
Date of pronouncement : 15.11.2018
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J U D G M E N T:
1.The present complaint has been filed under Section 138 of the Negotiable Instruments Act, 1881. Facts in brief as averred by the complainant are that the complainant was engaged by the accused to do the work of Gypsum Partition and Fall Ceiling at the booth/shop of the accused at City Home Apartment, Vatika, near Gurgaon, Haryana. The accused assured the complainant that he would make the payment for aforesaid work on mutual agreed amount between the complainant and the accused but did not reduce the same in writing despite repeated requests of the complainant. It was agreed between the complainant and accused that the accused will make the payment as per the prevailing current market rate. The aforesaid work was completed by the complainant on 22.08.2016 and in discharge of his liability, the accused paid Rs.40,000/ in cash on 03.08.2016, Rs.20,000/ in cash on 10.08.2016 and Rs.7,000/ in cash on 20.08.2016 and towards the balance payment, issued cheque bearing no. 641363 dated 24.08.2016 for a sum of Rs.15,000/ drawn on Canara Bank, Rajouri Garden Branch, New Delhi. The complainant presented the said cheque but it was dishonoured vide return memo dated 30.08.2016 for reason 'Funds Insufficient'. Upon assurance given by the accused the complainant again presented the said cheque but it was again dishonoured vide return memo dated 03.09.2016 with reason and remarks 'Funds Insufficient' and again vide return memo dated 14.10.2016 with remarks 'Funds Insufficient'. The complainant allegedly then served legal notice dated 25.10.2016 on the accused demanding the cheque amount and in spite of service of 2 of 15 said notice, the accused failed to make the payment of cheque amount and hence, committed an offence under Section 138, Negotiable Instruments Act.
2. In support of allegations in his complaint, the complainant filed his evidence by way of an affidavit and placed on record the following documents:
(i) Cheque bearing no. 641363 dated 24.08.2016 for a sum of Rs.15,000/ drawn on Canara Bank, Rajouri Garden Branch, New Delhi (Ex.CW1/1).
(ii) Cheque return memos issued by State Bank of India where the aforesaid cheque was presented for encashment reflecting that the said cheque was returned unpaid thrice for the reason "Funds Insufficient" on 30.08.2016, 03.09.2016 and 14.10.2016 (Ex.CW1/2, Ex.CW1/3 and Ex.CW1/4 respectively).
(iii) Legal Notice dated 25.10.206 addressed to the accused on behalf of the complainant demanding the payment of cheque amount within fifteen days from the receipt of said notice (Ex.CW1/5).
(iv) Postal receipt reflecting the fact that the aforesaid legal notice was dispatched to the accused on 25.10.206 (Ex.CW1/6).
(v) Internet Generated Postal Track Report regarding delivery of letter dispatched vide aforesaid postal receipt (Ex.CW1/7).
3. Upon consideration of the complaint and documents annexed therewith and upon examination of the complainant, the cognizance of offence under Section 3 of 15 138 Negotiable Instruments Act, 1881 was taken and process was issued against the accused. Accused appeared before this court and was admitted to bail.
4. Notice under Section 251 Cr.P.C. was framed against the accused to which, he pleaded not guilty and claimed trial. The accused admitted to have issued the cheque in question but stated that the complainant used to take advance payment for the work to be executed and that he had issued the cheque in question as advance payment for the work to be done by the complainant but the said work was not done by the complainant. He admitted the fact of receipt of legal demand notice dated 25.10.2016.
5. Application under Section 145(2), Negotiable Instruments Act was filed by the accused seeking permission for recalling and cross examination of complainant witnesses. The said application was allowed and the complainant was cross examined.
6. During his crossexamination, the complainant stated that he worked in the area admeasuring 303 square feet of Fall Ceiling and 598 square feet Gypsum Partition at the site of the accused. He further stated that as per the mutual agreed terms with the accused, the rate of fall ceiling work was Rs.75/ per square feet with material and Rs.100/ per square feet for the gypsum partition. He denied that he did the fall ceiling and gypsum partition work in total area of 852 square feet and stated to 4 of 15 have done the said work in total area of 901 square feet. He further denied that consolidated rate agreed for the fall ceiling and gypsum partition work was Rs.70/ per square feet. The complainant stated not to have undertaken the work of paint and polish at the site of the accused. He denied that he received payment of Rs.20,000/ in cash on 16.08.2016 instead of 10.08.2016 and stated to have received part payment of Rs.40,000/ on 03.08.2016, Rs.20,000/ on 10.08.2016 and Rs.7,000/ on 20.08.2016. The complainant stated not to be having any registered firm for doing the aforesaid work. He further stated not to be having any bill book or cash receipt or to be maintaining any payment record register for the transactions of the work undertaken. The complainant was confronted with a document produced by the Ld. Counsel for the accused and the said document was exhibited as Ex.CW1/DA. The complainant admitted his address, phone number and signatures at point 'A', 'B' and 'C' respectively on the said document. However, the complainant stated that the rate of Rs.70/ per square feet as mentioned on Ex.CW1/DA was not accepted by him. He further denied having received payment on 16.08.2016 as mentioned on ex.CW1/DA. He further denied having received Rs.7,000/ as advance cash payment for paint and polish work. He further denied that paint and polish work was decided to be undertaken for total amount of Rs.22,000/ or that in pursuance of the same, Rs.7,000/ were paid on 20.08.2016 and cheque in question was also handed over by the accused to him. He further denied that he undertook the work of fall ceiling and gypsum partition at the site of the accused at the rate of Rs.70/ per square feet for total area of 852 square 5 of 15 feet and had received payment of Rs.60,000/ in lieu thereof. He further denied that after receipt of legal notice, accused called him and he assured that he will not pursue this case any further. He further denied that accused never issued the cheque in question in his favour for fulfilment of any legal debt or that he had misused the present cheque which was issued in his favour as security /advance for payment of paint and polish work which he never started.
7. The complainant chose not to lead any further evidence.
8. The accused was examined in accordance with provisions of Section 313 Cr.P.C. During the said examination, the accused stated that he did not issue the cheque in question towards the payment of work of Gypsum partition and fall ceiling executed by the complainant at his shop at City Home Apartment, Vatika near Gurgaon, Haryana rather the same was issued as security for the work of paint and polish to be done by the complainant. He further stated that he had already made the payment to the complainant for the work of Gypsum Partition and Fall Ceiling and have also filed a receipt Ex.CW1/DA regarding the same. He further stated that the complainant was engaged to do paint and polish work for Rs.22,000/ and that he gave him Rs.7,000/ in cash and issued cheque Ex.CW1/1 as security for procurement of material by the complainant but the complainant did not complete the work of paint and polish and also did not procure the material for the said work. He admitted the receipt of the demand notice dated 25.10.2016 but stated that his brother was ill and 6 of 15 admitted to the hospital at that time and accordingly, he could not contact his lawyer. The accused opted to lead evidence in his defence.
9. The accused examined himself as DW1.
10. During his examinationinchief, DW1 stated that he engaged complainant for Gypsum Partition and sealing work for his office at Gurgaon and that the said work was fixed at the rate of Rs. 70 per square feet in writing on 03.08.2016. He further stated that on the same day, he paid an advance of Rs. 40,000/ and the complainant has assured to finish the said work within 8 to 10 days and that the said work was completed on 16.08.2016. He further stated that the work was done in the total area of 852 square feet and that the total cost of the said work was Rs. 59,640/ and he paid balance amount of Rs. 20,000/ to the complainant after completion of work at his residence. He further stated that he further handed over paint and polish work at the same premises to the complainant at the total amount of Rs. 22,000/ and on 20.08.2016, he paid an advance of Rs. 7,000/ out of the total amount. He further stated that the complainant further requested him to hand over the remaining balance of Rs. 15,000/ so that he can procure the raw material for smooth working and promised that the paint and polish work will be completed in 2 to 3 days. He further stated that he refused to hand over the remaining amount of Rs.15,000/ in cash to the complainant and the complainant requested for a security cheque dated 24.08.2016 of the remaining amount of Rs. 15,000/. He further stated that he called the 7 of 15 complainant several times for completing the said work and verbal altercation also took place between him and the complainant and thereafter the complainant never received his calls or refused to answer. He further stated that after receipt of legal notice he got to know the status of cheque but could not reply the legal notice since he was busy taking care of his ailing brother at Ludhiana. He further stated that he does not transact much with the account of which the cheque was issued to the complainant nor he had availed any SMS facility for transaction with his account of the said bank. He further stated that he took receiving of the complainant after making each and every payment which was due for the work done by the complainant. He further stated that the security cheque was not mentioned on the receipt of payment ExCW1/DA and the said security cheque has been misused by the complainant by filing the present case and he owes no legal liability towards the complainant. He further stated that the document Ex.CW1/DA bears the name, address and phone number of the complainant at point A and B respectively while the complainant put his signatures after receipt of each payment on date mentioned at point C (colly) on Ex.CW1/DA.
During his crossexamination, DW1 denied that rate of Gypsum partition was fixed at Rs. 100 per square feet and rate of false ceiling was fixed at Rs. 75 per square feet. He further denied that false ceiling work was done in the area admeasuring 303 square feet while the gypsum partition work was done in the area of 598 square feet. He admitted that he made payment of Rs. 40,000/ on 03.08.2016 but denied having made payment of Rs. 20,000/10.08.2016 and stated to have made the 8 of 15 same on 16.08.2016. He further stated that while the payment of Rs. 7,000/ was made on 20.08.2016, the work of gypsum partition and false ceiling was completed on 16.08.2016. He denied that said work was completed on 22.08.2016. He further denied that the words "for paint and polish" encircled as X on Ex. CW1/DA were later on added. He further denied that the word "Adv" encircled as X1 on Ex. CW 1/DA was later on added. He further denied that the word "Suraj" encircled as X2 on Ex. CW1/DA was later on added. He further denied that complainant had undertaken the work of only gypsum partition and false ceiling and not of paint and polish. He further denied that the amount of Rs. 7,000/ and cheque in dispute was handed over to the complainant as a part payment of the work of gypsum partition and false ceiling. The accused stated not to have made any police complaint regarding the cheque in question. He further stated that he did not inform the bank to stop the payment of the above said cheque.
11. Final Arguments were heard. During the final arguments, it was submitted by Ld. Counsel for the Complainant that all the ingredients of the offence under Section 138 Negotiable Instruments Act are made out and accordingly, the accused be convicted. He pointed towards the fact that the accused admitted having issued the cheque in question as well as the receipt of demand notice.
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12. On the other hand, Ld. Counsel for accused argued that the Complainant has failed to prove his case and presumption under Section 139 read with Section 118 of the Negotiable Instruments Act has been rebutted and accordingly, the accused be acquitted. He pointed towards the fact that the complainant, in his complaint, mentioned that no terms were agreed between him and the accused for the work to be done but during his crossexamination, the complainant stated that the rate was fixed as per the mutually agreed terms. He further submitted that paint and polish work was decided to be done for total amount of Rs.22,000/ which includes Rs.7,000/ paid in cash on 03.08.2016 and Rs.15,000/ by way of cheque in question. He further submitted that complainant stated not to have undertaken paint and polish work and accordingly, aforesaid amount of Rs.22,000/ was security. Ld. Counsel for accused also relied on certain judgments in support of his arguments. Applicable Law and its application to present facts
13. To establish an offence under Section 138 of the Negotiable Instruments Act, the following ingredients are to be established by the complainant:
(i) Cheque must have been drawn by the accused on an account maintained by him with a banker.
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(ii) Cheque must have been drawn for payment of any amount of money to another person for discharge, in whole or in part, of any debt or other liability.
(iii) Said cheque is returned unpaid by bank for the reason that either 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 made with that bank.
(iv) The cheque must have been presented to the bank within a period of 6 months from the date on which it is drawn or within the period of its validity, whichever is earlier.
(v) The payee or holder in due course makes a demand for payment by giving notice in writing to the drawer of the cheque within 30 days of receipt of information by him from the bank regarding the return of cheque as unpaid.
(vi) Drawer of the cheque fails to make the payment of the said amount to the payee or holder in due course of cheque within 15 days of said notice.
Section 142, Negotiable Instruments Act further requires the complaint under Section 138 must be made in writing by payee or holder in due course of cheque and such complaint must be made within one month from the date on which the cause of action arises i.e. within one month from the expiry of fifteen days time within which the accused is required to make the payment of cheque amount upon receipt of demand notice.
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14. Now coming to the facts of the present case, it is not in dispute that the accused issued the cheque in question, that the said cheque was returned unpaid for the reason 'fund insufficient', that the said cheque was presented within the period of its validity; that upon information of dishonour of cheque, the complainant made a demand in writing for payment of cheque amount within a period of thirty days from the receipt of information of dishonour and that the accused received the demand notice.
Accordingly, ingredients (i), (iii), (iv), (v) and (vi) of the offence under section 138 are well established and not in dispute.
15. However, the accused has averred that he did not owe any liability towards the complainant.
16. At this point, provisions of Section 118 read with Section 139 of the Negotiable Instruments Act become relevant which raises a presumption that the negotiable instrument was drawn for a consideration and that payee or holder in due course of cheque received that the said cheque for discharge, in whole or in part, of any debt or other liability 12 of 15 However, this is a rebuttable presumption. The burden of rebuttal lies on the accused. The standard of proof required is not as strict as is required to establish a criminal liability, and will be discharged on the basis of preponderance of probabilities.
17. The accused stated to have made the entire payment against the work done by the complainant at his shop and stated to have given the cheque in question for paint and polish work and since said work was not done by the complainant, there is no liability to make the payment. The burden of proving said fact was on the accused. In his defence, the accused produced a document Ex.CW1/DA which reflects the payments received by the complainant from the accused on several dates. Although the complainant admitted his signatures at points A, B and C on the said document but he denied to have agreed to perform the work of paint and polish and also denied to have received Rs.7,000/ in cash and cheque in question as advance payment towards the said work and stated that the words 'paint and polish' were written at later stage by the accused. The document produced by the accused does not mention as to against what liability the accused issued the cheque in question. The accused was diligent enough to obtain the signatures of the complainant on all the payments made and accordingly, not taking any acknowledgment against issuance of cheque does raise a doubt as to the testimony of the accused. The burden to prove a fact is on the person who asserts the same. If the version of the accused is to be 13 of 15 believed that he issued the impugned cheque as security towards the payment for paint and polish work to be done by the complainant but the said work was not performed by the complainant, then in such a circumstance any prudent person is expected to take steps for taking back the possession of his cheque. No record has been placed showing any efforts on part of the accused to demand back his cheque and also no instructions were given to the bank to stop the payment of the impugned cheque. Even if the fact that the accused at first might not be aware that his cheque will be misused is taken into consideration but after the cheque was dishonoured once, any prudent person is expected to take steps to stop any further misuse. Merely stating that the account of which the cheque was issued was not being used by the accused cannot be considered to be a reasonable explanation.
In view of the above discussion, I am of the view that the accused failed to rebut the presumption raised by virtue of Section 118 read with Section 139, Negotiable Instruments Act.
Accordingly, ingredient (ii) of offence under Section 138, Negotiable Instruments Act is also established.
18. Upon consideration of the facts of the case and evidence adduced, this Court is of the view that the Complainant has been able to establish the guilt of the 14 of 15 accused beyond reasonable doubts.
19. Accordingly, the accused is hereby convicted of offence under Section 138 of the Negotiable Instruments Act, 1881. Digitally signed by UPASANA UPASANA SATIJA SATIJA Date:
2018.11.16 15:03:05 +0530 Announced in the open Court on 15th day of November, 2018 (UPASANA SATIJA) MM03 (NI Act)/SouthWest Dwarka/ New Delhi 15 of 15