Delhi District Court
Akash Pandey vs Karan Verma on 19 March, 2024
IN THE COURT OF MS. SHIKHA CHAHAL, MM (NI ACT) DIGITAL COURT-3
SOUTH DISTRICT, SAKET COURTS COMPLEX: NEW DELHI
AKASH PANDEY
CC NI ACT/609/2022
Vs.
DLST020014922022
KARAN VERMA
1. Complainant case number CC NI ACT/609/2022
DLST020014922022
2. Name of the complainant Akash Pandey
S/o Sh. Arun Kumar Pandey
R/o C-59, Freedom Fighters Enclave,
Neb Sarai, New Delhi-110068
3. Name and address of the accused Karan Verma
S/o Sh. Manik Verma
R/o A-1/40, Freedom Fighters Colony,
New Delhi-110068
4. Offence complained of Section 138 of the Negotiable
Instruments Act, 1881
5. Plea of the accused Pleaded not guilty and claimed trial
6. Final order Acquittal
7. Date of institution 01.02.2022
8. Date of reserving the judgment 21.02.2024
9. Date of pronouncement 19.03.2024
-:JUDGEMENT:-
1. The present complaint under section 138 Negotiable Instruments Act, 1881 (herein referred to as NI Act) has been filed by Akash Pandey (herein referred to as the 'complainant') against accused namely Karan Verma (herein referred to as the 'accused').
2. Briefly stated, facts of the complaint case are that accused and complainant were known to each other since long time and good relations developed between them. In the second week of January, 2019, the accused had approached complainant for taking loan of Rs.1,00,000/- due to some urgent need and the accused assured the complainant to return the same on or before October, 2021. Thereafter, complainant gave a sum of Rs.1,00,000/- cash to the accused on 18.01.2019 and the accused assured to the complainant to return the same on or before October, 2021. After lapse of the above said stipulated period the complainant Digitally signed by SHIKHA SHIKHA CHAHAL Date:
CHAHAL 2024.03.19 AKASH PANDEY Vs. KARAN VERMA 15:28:46 +0530 Page No.1 of 14 contacted accused for repayment and accused issued a cheque no.157900 dated 29.10.2021 to the complainant in discharge of his legal liability towards the complainant. The said cheque got dishonoured vide return Memos dated 30.10.2021 and 22.11.2021 with remarks '88-BNK CD EXCL WEF' and then complainant issued legal demand notice dated 17.12.2021, which was duly delivered to accused. Despite the same, accused did not return the cheque amount to the complainant within the stipulated period. Hence, the present complaint under Section 138 of Negotiable Instruments Act, 1881 (hereinafter referred to as 'NI Act') was filed.
3. Accused entered appearance in the present matter for the first time on 13.05.2022 and was admitted to bail on the same day. Notice u/s 251 CrPC was served upon the accused on 02.08.2022, to which he pleaded not guilty and claimed trial. His plea of defence was also recorded and accused was allowed to cross examine the complainant. EVIDENCE:-
4. In order to support its case, the complainant had stepped into the witness box as CW-1 and tendered evidence by way of an affidavit Ex.CW-1/A on 20.09.2022 wherein averments made in the complaint were reiterated. He also relied upon various documents such as:
Sl. No. Exhibits Documents
1. Ex. CW-1/1 Cheque in question bearing no. 157900 dated 29.10.2021
for Rs. 1,00,000/-
2. Ex. CW-1/2 Return memo dated 30.10.2021
3. Ex. CW-1/3 Return memo dated 22.11.2021
4. Ex. CW-1/4 Legal demand notice dt. 17.12.2021
5. Ex. CW-1/5 Postal receipt of the legal notice
6. Ex. CW-1/6 Tracking report of the legal notice
7. Ex. CW-1/7 Complaint
8. Ex. CW-1/AA (Colly) WhatsApp chats between the complainant and the accused
9. Ex. CW-1/AB Certificate u/s 65B of Indian Evidence Act
5. After examining the complainant as CW-1, the complainant evidence was closed vide order dated 21.11.2022. Thereafter, statement of the accused u/s 313 CrPC was recorded. Accused opted to lead DE and accused was examined as DW-1 and at the stage of DE matter was referred to mediation at joint request of both parties but mediation failed between them.
6. DW-1 Karan Verma deposed that he had taken Rs.1,00,000/- in cash from the complainant in November/December 2018. Complainant had said to him "bhai aapke paas Digitally signed by SHIKHA SHIKHA CHAHAL Date:
CHAHAL 2024.03.19 15:28:51 +0530 AKASH PANDEY Vs. KARAN VERMA Page No.2 of 14 jo payment jaise- jaise aati jaaye, aap thode -thode karke wapas kar dena". He further deposed that consistently had returned small amounts to the complainant in discharge of the loan liability that he had taken. Even during covid period, he kept making small payments in sums such as Rs3,000/-, Rs.7,000/- etc. to the complainant through modes such as UPI, Paytm Wallet, Cash, etc. He is not even counting the small amounts which he spent over the complainant to cover minor expenses such as recharging the talk time of the phone of the complainant. If he considers the sum total of all the small payments that he had made, it is around Rs.65,000/- through UPI, Paytm wallet etc. to the complainant. Complainant and he used to work together. He has also paid Rs.20,000/- approximately to the complainant in cash. Besides, since the complainant and he used to work together, he had asked the complainant to keep deducting small amounts from the commission towards satisfaction of his loan liability towards the complainant. All in all, he would have paid over and above his loan liability of Rs.1,00,000/- to the complainant. He denied any financial liability towards the complainant He also relied upon screen shot of Paytm transaction Ex. DW-1/1.
Thereafter, DE was closed and case was fixed for final arguments. APPLICABLE LAW:-
7. Before appreciating the facts of the case in detail for the purpose of decision, let relevant position of law be discussed.
Now, Section 138 Negotiable Instrument Act provides as under:
Section 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 made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply unless-
(a) the cheque has been presented to the bank within a period of six months (reduced to three months vide notification no. RBI/2011-
12/251, DBOD AMLBCNo. 47/19.01.0062011/12,dated 04.11.2011) from the date on which it is drawn or within the period of its validity, whichever is earlier; (b) the payee or the holder in due course of the Digitally signed by SHIKHA SHIKHA CHAHAL CHAHAL Date:
2024.03.19 AKASH PANDEY Vs. KARAN VERMA 15:28:57 +0530 Page No.3 of 14 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 fifteen 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. It is well settled position of law that to constitute an offence under S.138 N.I. Act, the following ingredients are required to be fulfilled:
(1) drawing of the cheque by a person on an account maintained by him with a banker, for payment to another person from out of that account for discharge in whole/part any debt or liability; (2) cheque has been presented to the bank within a period of six months (now three months) from the date on which it is drawn or within the period of its validity whichever is earlier; (3) returning the cheque unpaid by the drawee bank for want of sufficient funds to the credit of the drawer or any arrangement with the banker to pay the sum covered by the cheque, (4) giving notice in writing to the drawer of the cheque within 30 days of the receipt of information by the payee from the bank regarding the return of the cheque as unpaid demanding payment of the cheque amount, (5) failure of the drawer to make payment to the payee or the holder in due course of the cheque, of the amount covered by the cheque within 15 days of the receipt of the notice.
Being cumulative, it is only when all the aforementioned ingredients are satisfied that the person who had drawn the cheque can be deemed to have committed an offence under Section 138 of the N he Act.
The Act raises two presumptions in favour of the holder of the cheque i.e. Complainant in the present case; firstly, in regard to the passing of consideration as contained in Section 118 (a) therein and, secondly, a presumption under Section 139, that the holder of cheque receiving the same of the nature referred to in Section 138 for discharge, in whole or in part, of any debt or other liability. Analysing all the concerned provisions of law and various pronouncements in this regard, the Hon'ble Apex Court in Basalingappa v. Mudibasappa, AIR 2019 SC 1983, noted at para 23 as follows [Bharat Barrel and Drum Manufacturing Company v. Amin Chand Pyarelal, (1999) 3 SCC 35; M.S. Narayana Menon alias Mani v. State of Kerala and another, (2006) 6 SCC 39; Krishna Janardhan Bhat v. Dattatraya G. Hegde, (2008) 4 SCC 54; Kumar Exports v. Sharma Carpets, (2009) 2 SCC 513; Rangappa v. Sri Mohan, (2010) 11 SCC 441 referred]:
(i) Once the execution of cheque is admitted, Section 139 of the Act Digitally signed by SHIKHA SHIKHA CHAHAL Date:
CHAHAL 2024.03.19 15:29:02 +0530 AKASH PANDEY Vs. KARAN VERMA Page No.4 of 14 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 imposes 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.
To put in nutshell, the law regarding the presumption for the offence under Section 138 N.I. Act,is that the presumptions under Sections 118(a) and 139 have to be compulsorily raised as soon as execution of cheque by the accused is admitted or proved by the complainant and thereafter burden is shifted upon the accused to prove otherwise. These presumptions shall end only when the contrary is proved by the accused, that is, the cheque was not issued for consideration and in discharge of any debt or liability etc. The onus to prove the issuance of the cheque lies upon the complainant, and the same has to be proved beyond reasonable doubt, unless the accused admits the same. Once the issuance of cheque is established, either by admission or by positive evidence, the presumption under Section 139 of the Negotiable Instruments Act, 1881 arises. We can summarize the general principles in the following way:
Onus of proof: Section 139 of the Negotiable Instruments Act, 1881 states that it shall be presumed, unless the contrary is proved that the holder of a cheque received the cheque, of the nature referred to in Section 138, for the discharge, in whole or in part, of any debt or other liability. Therefore, here the onus shifts upon the accused to prove the nonexistence of debt or other liability. Section 139 of the N.I. Act uses the word "shall presume", which means that the presumption under Section 139 is rebuttable. Standard of proof: The standard of proof required to rebut the presumption under Section 139 is that of "preponderance of probabilities". Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or other liability, the onus shifts back to the complainant to prove by way of evidence, beyond reasonable doubt, that the cheque in question was issued by the accused in discharge, whole or in part, of any debt or other liability, and now the Digitally signed by SHIKHA SHIKHA CHAHAL CHAHAL Date:
2024.03.19 15:29:07 +0530 AKASH PANDEY Vs. KARAN VERMA Page No.5 of 14 presumptions under Section 118 (a) and Section 139 will not come to the aid of the complainant.
Mode of Proof: The accused may adduce direct evidence to prove that the cheque in question was not supported by consideration, and that there was no debt or liability to be discharged by him. However, the Court need not insist in every case that the accused should prove the nonexistence of the consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that a bare denial of passing of consideration and existence of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumptions, the accused should bring on record such facts and circumstances upon the consideration of which, the Court may either believe that the consideration and debt did not exist, or their nonexistence was so probable that a prudent man would, under circumstances of the case, act upon the plea that they did not exist.
As discussed above, from the legal provisions and the law laid down in various judgments, it can be safely gathered that it is for the accused to rebut the presumptions. He can do so by cross examining the complainant, leading defence evidence, thereby demolishing the case of the complainant. It is amply clear that the accused does not need to discharge his or her liability beyond the shadow of reasonable doubt. He just needs to create holes in the case set out by the complainant. Accused can say that the version brought forth by the complainant is inherently unbelievable and therefore the prosecution cannot stand. In this situation the accused has nothing to do except to point inherent inconsistency in the version of the complainant or the accused can give his version of the story and say that on the basis of his version the story of the complainant cannot be believed.
ARGUMENTS AND APPRECIATION OF EVIDENCE:-
8. Ld. Counsel for the complainant has argued that all the requirements of Section 138 NI Act have been met with in the present case and hence, the accused be convicted. I have heard the arguments and also gone through the record with due circumspection.
9. In the case at hand, Ld. Counsel for the complainant has submitted that the accused has not disputed the issuance of the cheque or the signature on the cheque in the present case, thus, the presumptions u/s 118 (a) read with Section 139 of NI Act about the cheque in question having been issued for consideration and in discharge of legal liability should arise AKASH PANDEY Vs. KARAN VERMA Page No.6 of 14 in favour of the complainant. On the other hand, Ld. Counsel for accused argued that accused did not receive legal demand notice and has repaid the loan taken from the complainant through cash, paytm, UPI transactions and there is no legal liability towards the complainant. Ld. Counsel for accused has relied upon the judgment of Dashrathbhai Trikambhai Patel v. Hitesh Mahendrabhai Patel, (2023) 1 SCC 578. Ld. Counsel for accused has rebutted the presumption by raising probable defence that accused is not liable for the amount mentioned in the cheque in question as he has already repaid the loan amount.
10. The scheme of Section 138 read with its explanation categorically provides that a liability for dishonour of the cheque would be imposed on the accused only when the cheque was issued for discharge of an existing legally recoverable debt or liability. Mere admission of execution of the cheque is not sufficient, it must also be proved that the cheque was issued to discharge a legally enforceable debt or liability. It is a trite law that in a criminal case, the prosecution must prove its case beyond reasonable doubt by leading reliable, cogent and convincing evidence and in order to bring the guilt of the accused, the prosecution story must stand on its own legs and it cannot derive any benefits whatsoever from the weakness, if any, in the defence of the accused.
11. Let's now discuss the facts and circumstances of the present matter in the light of law laid down. In the present case, the accused has not denied his signature on the cheque Ex.CW-1/1. Thus, the factum of signatures on the cheque is not disputed and has been acknowledged.
12. It is pertinent to mention here that Sec. 139 only raises the presumption on fulfillment of its conditions that the cheque was issued for discharge of in whole or in part any debt or other liability but there is no presumption as to the existence of the debt or liabilty as such. In Rangappa (supra) it has been held that :
"Existence of legally recoverable debt is not a matter of presumption under Section 139 of the Act. It merely raises a presumption in favour of a holder of the cheque that the same has been issued for discharge of any debt or other liability."
13. As regards the legal notice, the receipt of the same has been denied by the accused but he has admitted that address on the legal demand notice is correct. As per postal receipt Ex.CW-1/5 legal demand notice Ex.CW-1/4 was duly sent to the accused at his correct address and it was delivered to him as per tracking report Ex. CW-1/6. As per provisions of Digitally signed by SHIKHA SHIKHA CHAHAL CHAHAL Date:
2024.03.19 15:29:13 AKASH PANDEY Vs. KARAN VERMA +0530 Page No.7 of 14 Section 114 of Indian Evidence Act, 1872, read with Section 27 of General Clauses Act, the court may presume that legal notice duly addressed to the accused persons and dispatched to them by way of post was actually received by the accused persons, regard being had to common course of natural events. Reliance is also placed upon the case of C C Alavi Haji v. Palapetty Muhammed [2007 (6) SCC 555] wherein it was held by the Hon'ble Supreme Court that:
"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 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 alongwith 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 General Clauses Act and Section 114 of Indian Evidence Act."
Hence, in my opinion, legal notice Ex.CW-1/4 was duly served upon the accused.
14. As regards to the fact of dishonour of the cheque in question, the original return memo Ex.CW-1/2 and Ex.CW-1/3 filed by the complainant clearly shows that the cheque in question Ex.CW-1/1 was dishonoured for the reason 'funds insufficient'. In the case at hand, neither any argument has been raised on behalf of the accused to dispute the dishonor of the cheque nor this fact has been denied at any stage of the matter. Thus, taking into account that dishonour of cheque is not disputed, this fact, also stands proved.
15. Thus, the presentation of the cheque in question, its dishonour and service of legal notice is not under question. Consequently, the complainant has successfully raised a presumption under Section 139 NI Act.
16. Accordingly, it is required to be presumed that the cheque in question was drawn for consideration and the holder of the cheque i.e., the complainant received the same in discharge of an existing debt. The onus, therefore, shifts on the accused to establish a probable defence so as to rebut such a presumption.
17. In the segment on legal framework, set out above, the legal proposition with respect to the burden of proof upon the accused has already been discussed. Hence, it is now to be Digitally signed by SHIKHA SHIKHA CHAHAL CHAHAL Date:
2024.03.19 AKASH PANDEY Vs. KARAN VERMA 15:29:19 +0530 Page No.8 of 14 examined as to whether the accused brought any material on record or pointed out glaring discrepancies in the material produced by the Complainant for dislodging the presumption which meets the standard of preponderance of probabilities.
18. To rebut the statutory presumption an accused is not expected to prove his defence beyond reasonable doubt as is expected of the complainant in a criminal trial. The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the Court need not insist in every case that the accused should disprove the non-existence of consideration and that by leading direct evidence because the existence of negative evidence is entirely possible nor contemplated. At the same time, it is clear that bare denial of the passing of the consideration and existence of that, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumption the accused should bring on record such facts and circumstances, upon consideration of which the Court may either believe that the consideration and debt did not exist, or their non- existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist. Apart from adducing direct evidence to prove that the note in question was not supported by consideration or that he had not incurred any debt or liability, the accused may also rely upon circumstantial evidence and if the circumstances so relied upon are compelling, the burden may likewise shift again on the complainant.
19. A statutory presumption has an evidentiary value. The question as to whether the presumption stood rebutted or not, must, therefore, determined keeping in view the other evidence on record. In case of this nature, where the chances of false implication cannot be ruled out the background fact and the conduct of the parties together with the legal requirements are required to be taken into consideration. The Hon'ble Supreme Court in the case of Krishna Janardhan Bhat v. Dattaraya G. Hegde (supra) had observed that, "45. We are not oblivious of the fact that the said provision has been inserted to regulate the growing business, trade, commerce and industrial activities of the country and the strict liability to promote greater vigilance in financial matters and to safeguard the faith of the creditor in the drawer of the cheque which is essential to the economic life of a developing country like India. This, however, shall not mean that the courts shall put a blind eye to the ground realities. Statute mandates raising of presumption, but it stops at that. It does not say how presumption drawn should be held to have rebutted. Other important principles of legal jurisprudence, Digitally signed by SHIKHA SHIKHA CHAHAL CHAHAL Date:
AKASH PANDEY Vs. KARAN VERMA 2024.03.19 15:29:25 +0530 Page No.9 of 14
namely presumption of innocence as human rights and the doctrine of reverse burden introduced by Section 139 should be delicately balanced. Such balancing acts, indisputably would largely depend upon the factual matrix of each case, the materials brought on record and having regard to legal principles governing the same."
20. In the present matter, the defence taken by the accused is that cheque in question was a security cheque and that he has repaid the loan amount and does not have legally enforceable liability towards the cheque in question. In relation to the defence regarding security cheque, it is important to note that the Hon'ble High Court of Delhi in Suresh Chandra Goyal v. Amit Singhal, Crl. L.P, 706/2014 has succinctly observed that:
"Section 138 of NI Act does not distinguish between a cheque issued by the debtor in discharge of an existing debt or other liability, or a cheque issued as a security cheque on the premise that on the due future date the debt which shall have crystallized by then, shall be paid. So long as there is a debt existing, in respect whereof the cheque in question is issued, in my view, the same would attract Section 138 of NI Act in case of its dishonour."
21. Therefore, the defence of the cheque being a security cheque does not by itself rebut the presumption. Here, it is noted that if the observations in Suresh Chandra Case (supra) are considered, it appears that if on the date of presentment of cheque, liability of the accused existed towards the Complainant, the same would fall under Section 138 NI Act, even if the same was issued as a security cheque; and hence, it is not relevant if the cheque in question was issued with the intent of it being a security cheque. In fact, the Hon'ble Supreme Court in a recent judgment of the Sunil Todi Case (Supra), has held that the provisions of Section 138 NI Act apply to cheques issued on advance basis as well, if at the time of presentation of the same, liability exists. It was observed that:
"The object of the NI Act is to enhance the acceptability of cheques and inculcate faith in the efficiency of negotiable instruments for transaction of business. The purpose of the provision would become otiose if the provision is interpreted to exclude cases where debt is incurred after the drawing of the cheque but before its encashment. In Indus Airways, advance payments were made but since the purchase agreement was cancelled, there was no occasion of incurring any debt. The true purpose of Section 138 would not be fulfilled, if 'debt or other liability' is interpreted to include only a debt that exists as on the date of drawing of the cheque."
Hence, unless it is shown that no liability existed on the date of presentation, the provision of Section 138 NI Act would apply to cheques issued as a security cheque as well.
Digitally signed by SHIKHASHIKHA CHAHAL CHAHAL Date:
AKASH PANDEY Vs. KARAN VERMA 2024.03.19 15:29:30 +0530 Page No.10 of 14 Accordingly, this argument/defence of the Accused, by itself, does not rebut the presumption u/s 139 NI Act.
22. The main defence taken by the accused is that he doesn't have liability of the amount mentioned in the cheque in question and has repaid the loan amount. In the present matter, a friendly loan of Rs.1,00,000/- was given in cash by the complainant to the accused without any interest and as such there is no agreement or promissory note or receipt in respect of loan extended to accused. However, accused has himself admitted the loan and has not questioned the loan amount of Rs.1,00,000/-.
23. Now let's first discuss the testimony of CW-1. CW-1 in his cross-examination has himself stated " I cannot say with certainty if the accused returned a sum of Rs.63,000/-to me through UPI . Vol. Accused did repay certain amounts to me through UPI but I cannot say if the same amounted to Rs.63,000/-." Therafter, CW-1 has admitted in his cross- examination that accused has returned to him a sum of Rs.30,000/- through UPI and around Rs.15,000/- through PayTM wallet. However, the claim of CW-1 that accused has repaid the said amount qua a separate transaction between them is not proved rather no such transaction or loan was disclosed by him in his complaint or evidence by way of affidavit.
24. Admittedly, loan of Rs.1 lakh was given on 18.01.2019. CW-1 in his cross- examination has admitted that the transactions of Rs.45,000/- took place between January 2019 till dishonour of cheque which makes it probable that the said amount was repaid by the accused qua the loan in question as no other loan prior to the loan in question was disclosed between the parties. CW-1 has given an evasive answer as he states "I cannot say with certainty if the accused has repaid a sum of Rs.63,000/- to me in respect of the loan liability of Rs.1,00,000/-." In cross-examination, CW-1 could not explain as to why accused returned Rs.45,000/- to him when during cross-examination he had made a claim that the amount was returned qua another loan transaction of Rs.40,000/-. This creates doubt on the testimony of CW-1. Even if the version of CW-1 is believed that there was an earlier loan of Rs.40,000/- and admittedly Rs.45,000/- was repaid by the accused to the complainant then the excess amount of Rs.5,000/- can be regarded as repayment of the loan liability in question and the amount of Rs.1,00,000/- can not be said to be due on the date of presentation of cheque. Further more, the account statement of CW-1 i.e. Ex.CW-1/8 shows various entries of payment from accused to the complainant on dated 03.07.2020, 03.03.2020, 30.01.2020, 08.01.2020, 06.01.2020, 03.08.2021, 23,06,2021, 01.06.2021, Digitally signed by SHIKHA SHIKHA CHAHAL CHAHAL Date:
2024.03.19 15:29:36 +0530 AKASH PANDEY Vs. KARAN VERMA Page No.11 of 14 30.04.2021, 14.03.2021, 29.01.2021, 03.01.2021 and CW-1 was unable to explain the disputed entries which were credited in his bank account. Also, CW-1 admitted that he has received certain amounts from the accused in his Paytm wallet. It is evident that the date of loan is 18.01.2019 and all the aforesaid entries in the bank account statement of complainant Ex.CW-1/8 are after the advancement of loan transaction till the dishonour of cheque. The explanation given by CW-1 that the "money was returned on account of certain past dues" is absolutely vague and raises further suspicion on the testimony of complainant as he is improving his version during cross-examination. CW-1 gave wrong reason for presentation of the cheque twice during cross-examination and when he was confronted with the return memos, he admitted that the reason for dishonour in both return memos is the same. In view of the aforesaid discussion, this court finds that the testimony of CW-1 is not reliable and is discarded being not trustworthy.
25. Moving further, testimony of accused / DW-1 is perused and DW-1 has stated in his examination in chief that he has repaid an amount of Rs.65,000/- through UPI, Paytm wallet and also paid approximately Rs.20,000/- to the complainant in cash. DW-1 has deposed that he has paid more than his loan liability of Rs.1,00,000/- to the complainant and do not have any financial liability towards the complainant. DW-1 has relied upon the screen shot of his Paytm transaction dated 18.06.2021 of Rs.4000/- and Rs.3000/- on 04.08.2021 Ex.DW-1/1.
Complainant could not dispute the Paytm transaction even during cross-examination. In the present case, the accused has raised a probable defence that the complainant could not prove that the amount mentioned on cheque in question was the legal enforceable liability of the accused at the time when the cheque in question was presented by the complainant before his bank. Therefore, having regard to facts and circumstances of the case and evidences available on record the complainant's evidence is not sufficient to establish the existence of debt and his testimony is discarded being untrustworthy. Thus, it can be clearly said that the accused has rebutted the presumption raised under section 139 of NI Act. Consequently, it can be said that no legal liability exists in favour of the complainant, thus, the second ingredient to the offence under section 138 of NI Act is not proved.
26. It is an admitted case between the parties that the loan was an interest free loan. Admittedly, there are no other outstanding dues between the parties except the present loan. Thus, prima facie, the payments made by accused through UPI and Paytm are after the advancement of loan and are being considered as payment towards the present loan Digitally signed by SHIKHA SHIKHA CHAHAL Date:
CHAHAL 2024.03.19 15:29:41 +0530 AKASH PANDEY Vs. KARAN VERMA Page No.12 of 14 transaction. CW-1 / complainant has himself admitted repayment of certain amount in his cross-examination as discussed above. The mandate of law is that the entire amount of the cheque should have been due as on the day of the drawal and presentation of the cheque. Reliance is placed by this court on the judgments of Hon'ble High Court of Delhi in Starkey Laboratories India Pvt. Ltd. vs. Sanjay Gujral decided on 24.09.2019 in Crl.L.P. 492/2017 and in Alliance Infrastructure Project Pvt. Ltd. (supra), wherein it has been held that if the liability as on the presentation of the cheque is not equivalent to the amount of cheque in question, then the accused cannot be held liable for offence u/s. 138 NI Act. In this regard, reliance is also placed by this court on the judgment of Hon'ble Supreme Court of India in Dashrathbhai Trikambhai Patel v. Hitesh Mahendrabhai Patel, (2023) 1 SCC 578.
27. The payment was made on 18.01.2019 and the cheque in question is dated 29.10.2021. Admittedly, the cheque has been presented without endorsement in terms of section 56 of the NI Act.
28. In view of the above discussion, I find that since the entire sum of the cheque in question, i.e., Rs.1,00,000/- was not due as on the date of presentation and drawal of the cheque in question and since the cheque was presented without proper endorsement u/s. 56 of Negotiable Instruments Act, hence, in view of the above-mentioned judgments of Hon'ble Superior Courts, the accused cannot be held liable for the offence u/s. 138 of NI Act.
29. It is also imperative to understand that in order to pronounce a conviction in a criminal case, the accused 'must be' guilty and not merely 'may be' guilty. For an accused to be guilty, guilt should not be based on mere surmises and conjectures but it should be based on cogent evidence. To recapitulate the above discussion, the accused has been successful in establishing a probable defence and has been able to prove his defence on the basis of preponderance of probabilities that there is no legally enforceable debt or liability in favour of the complainant equivalent to the amount of cheque in question as on the date of its drawal or on the date of its presentation. Thus, the accused has been able to rebut the presumption u/s. 118 r/w. section 139 NI Act. Furthermore, the complainant has failed to prove his case beyond reasonable doubt qua the accused in respect of the cheque in question.
Digitally signed by SHIKHASHIKHA CHAHAL Date:
CHAHAL 2024.03.19 15:29:45 +0530 AKASH PANDEY Vs. KARAN VERMA Page No.13 of 14 CONCLUSION:-
30. This court finds that cumulatively, the accused has been able to rebut the presumption raised against him under section 139 NI Act. The net result is that complainant has failed to prove its case beyond reasonable doubt.
DECISION:-
31. Accordingly, accused Karan Verma is acquitted of the offence under section 138 of NI Act.
Digitally signed by SHIKHASHIKHA CHAHAL Date:
CHAHAL 2024.03.19 Announced in the open 15:29:50 +0530 court on this 19.03.2024 (Shikha Chahal) MM(NI Act)Digital Court-3 (South) Saket Courts: New Delhi This judgment contains 14 pages all are signed by me. A copy of this judgment be placed on the official website of the District Court. Digitally signed by SHIKHA SHIKHA CHAHAL CHAHAL Date:
2024.03.19 (Shikha Chahal) 15:29:54 +0530 MM(NI Act)Digital Court-3 (South) Saket Courts: New Delhi AKASH PANDEY Vs. KARAN VERMA Page No.14 of 14