Delhi District Court
Complainant vs . on 30 July, 2022
IN THE COURT OF METROPOLITAN MAGISTRATE (NI-05), WEST,
TIS HAZARI COURTS, NEW DELHI
Presided over by- Devanshu Sajlan, DJS
Case No. - 2436/2018
Unique Case ID - DLWT020044792018
No.
In the matter of :-
Har Kishan Soni
... Complainant
VS.
Anowar Hussain @ Bablu Hussain
... Accused
1. Name of Complainant : Sh. Har Kishan Soni
2. Sh. Anowar Hussain @ Bablu
Name of Accused :
Hussain
3. Section 138, Negotiable
Offence complained of or proved :
Instruments Act, 1881
4. Plea of Accused : Not Guilty
5. Date of Filing : 05.04.2018
6. Date of Reserving Order : 27.07.2022
7. Date of Pronouncement : 30.07.2022
8. Final Order : Acquitted
Argued by: Sh. Mukul Gupta, learned counsel for the complainant.
Sh. Mohd. Shahjahan Islam, learned counsel for the accused.
DEVANSH Digitally signed by
DEVANSHU SAJLAN
U SAJLAN Date: 2022.07.30
20:40:12 +05'30'
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TABLE OF CONTENTS
A. Factual Matrix ..................................................................................... 3
B. Pre-Summoning Evidence & Notice .....................................................4
C. Complainant's Evidence .......................................................................5
D. Statement of Accused ............................................................................5
E. Ingredients of Offence and Discussion .................................................6
I. Contention: Once the mediation settlement agreement was
executed, the original cause of action was extinguished, and the
complaint needs to be dismissed
F. Conclusion.............................................................................................. 11
__________________________________________________________________
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BRIEF STATEMENT OF REASONS FOR THE DECISION:-
A. FACTUAL MATRIX
1. The present complaint has been filed by Sh. Har Kishan Soni (hereinafter
"complainant") against Sh. Anowar Hussain @ Bablu Hussain (hereinafter
"accused") under section 138 of the Negotiable Instruments Act, 1881
(hereinafter "NI Act").
2. The substance of allegations, as contained in the complaint, are as follows:
(a) The complainant claims that in 2007, the accused persuaded the complainant to
give him financial assistance to purchase passenger buses and further offered the
complainant to invest in his transport business. It has been further alleged that the
accused had assured the complainant to return his investment with profit. Based
on the aforesaid representation of the accused, the complainant and the accused
entered into a partnership deed (Ex. CW1/A (OSR)).
(b) The complainant further claims that based on the demand of the accused; the
complainant gave Rs. 53,61,000/- approx. to the accused for acquiring buses and
land for running the business till December 2016. However, since the accused had
not given any profit to the complainant till December 2016, the complainant
dissolved the partnership and agreed to do full and final settlement with the
accused subject to a payment of Rs. 16 lakhs by the accused to the complainant.
The said settlement was duly recorded vide the settlement deed (Ex. CW1/B
(OSR)).
(c) The complainant further claims that in discharge of his part liability, the accused
issued four cheques EX. CW1/C to EX. CW1/F of Rs. 26,000/-, Rs. 26,000/-,
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26000/- and Rs. 27000/- each to the complainant.
(d) It has been further alleged that the aforesaid cheques in question were
dishonoured for the reason "funds insufficient". Thereafter, the complainant sent a
legal demand notice, but the accused allegedly failed to pay the cheque amount
and therefore, the complainant filed the present complaint.
3. Accused's stance, on the contrary, is that a mediation settlement agreement has
already been executed in relation to the cheques in question, and hence, the
present complaint is not maintainable. The accused has not disputed execution of
the settlement agreement and has admitted that the cheques in question were
issued in discharge of the said settlement agreement. However, he has placed on
record a mediation settlement agreement dt. 19.11.18, as per which the accused
had issued 75 fresh cheques (from his Bandhan Bank account) to the complainant
to settle all the disputes with the complainant. It is the case of the accused that the
present dispute is also covered within the scope of the said mediation settlement
agreement.
B. PRE-SUMMONING EVIDENCE & NOTICE
4. Pre-summoning evidence was led by the complainant and on finding a prima facie
case, the accused was summoned to face trial vide order dated 13.03.20. On
appearance, the accused was served with the notice of accusation under Section
251, Code of Criminal Procedure, 1973 (hereinafter "CrPC") on 20.03.2021, to
which the accused pleaded not guilty and claimed trial.
5. Thereafter, the accused moved an oral application u/s 145(2) NI Act which was
allowed vide order dated on 20.03.2021; and the complainant was allowed to be
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cross-examined by the accused.
C. COMPLAINANT'S EVIDENCE
6. During the trial, the complainant has led the following oral and documentary
evidence against the accused to prove her case beyond reasonable doubt:
Oral Evidence
CW1 Sh. Har Kishan Soni (Complainant in person)
(tendered his evidence by way of affidavit)
Documentary Evidence
Ex. CW1/A (OSR) Partnership Deed between the complainant and the
accused
Ex. CW1/B (OSR) Settlement deed between the complainant and the
accused
Ex. CW1/C-Ex. CW1/F Cheques in question
Ex.CW1/G Return Memo
Ex. CW1/H Legal Demand Notice
Ex. CW1/I- Ex. CW1/K Postal Record
D. STATEMENT OF ACCUSED
7. Thereafter, before the start of defence evidence, in order to allow the accused to
personally explain the circumstances appearing in evidence against him, his
statement under Section 313 CrPC was recorded without oath. In reply, the
accused submitted:
The present cases need to be dismissed since mediation agreement has already
been executed in relation to the said cheques. I have already issued fresh
cheques from the account of Bandhan Bank towards the mediation settlement
agreement dt. 19.11.18.
8. The accused did not lead any defense evidence and the matter was listed for final
arguments. I have heard the learned counsels on both the sides and have given my
thoughtful consideration to the material appearing on record.
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E. INGREDIENTS OF OFFENCE AND DISCUSSION
9. Before dwelling into the facts of the present case, it would be apposite to discuss
the legal standards required to be met by both sides. In order to establish the
offence under Section 138 of NI Act, the prosecution must fulfil all the essential
ingredients of the offence, as highlighted below:-
First Ingredient: The cheque was drawn by a person on an account maintained
by him/her for payment of money and the same is presented for payment within a
period of 3 months from the date on which it is drawn or within the period of its
validity;
Second Ingredient: The cheque was drawn by the drawer for discharge of any
legally enforceable debt or other liability;
Third Ingredient: The cheque was returned unpaid by the bank due to either
insufficiency of funds in the account to honour the cheque or that it exceeds the
amount arranged to be paid from that account on an agreement made with that
bank;
Fourth Ingredient: A demand of the said amount has been made by the payee or
holder in due course of the cheque by a notice in writing given to the drawer
within thirty days of the receipt of information of the dishonour of cheque from
the bank;
Fifth Ingredient: The drawer fails to make payment of the said amount of money
within fifteen days from the date of receipt of notice.
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10. In addition to the above, the conditions stipulated under Section 142 NI Act have
to be fulfilled.
11. In addition to the above, the conditions stipulated under Section 142 NI Act must
be fulfilled.
12. Therefore, in a cheque dishonour case under section 138 NI Act, the complainant
is required to prove that the cheque in question was drawn by the drawer for
discharging a legally enforceable debt. As per the scheme of the NI Act, once the
accused admits signature on the cheque in question, certain presumptions are
drawn, which result in shifting of onus on the accused.
13. The combined effect of section 118(a) NI Act and section 139 of the NI Act is
that a presumption exists that the cheque was drawn for consideration and given
by the accused for the discharge of debt or other liability. Both the sections use
the expression "shall", which makes it imperative for the court to raise the
aforesaid presumptions once the foundational facts required for the same are
proved (Hiten P. Dalal v. Bratindranath Banerjee, (2001) 6 SCC 16). Further, it
has been held by the Hon'ble Apex Court in Rangappa v. Sri Mohan, (2010) 11
SCC 441 that the presumption contemplated under Section 139 of NI Act includes
the presumption of existence of a legally enforceable debt. In order to rebut the
statutory presumption u/s 139 NI Act, the standard of proof is that of
preponderance of probabilities, by which the accused is required to raise a
probable defence. To rebut the presumption, it is open to the accused to rely on
evidence led by him/her or the accused can also rely on the materials submitted by
the complainant or the circumstances upon which the parties rely in order to raise
a probable defence (Basalingappa v. Mudibasappa, (2019) 5 SCC 418).
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14. Further, it is pertinent to note that it is a settled position of law that the accused, to
rebut the statutory presumption, 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 (Kumar Exports v. Sharma Carpets, (2009) 2 SCC 513, ¶ 20).
15. The accused has contended that the aforesaid ingredients are not satisfied in the
present case and there is no legally enforceable debt in relation to the cheques in
question since mediation settlement agreement has already been executed in
relation to the cheques in question, and hence, the present complaint is not
maintainable. The said contention is discussed hereinafter.
Contention: Once the mediation settlement agreement was executed, the
original cause of action was extinguished, and the complaint needs to be
dismissed
16. It has been submitted on behalf of the accused that after dishonour of the cheques
issued pursuant to the settlement deed Ex. CW1/B (OSR), multiple complaints
were filed by the complainant against the accused. It has been further submitted
that with the consent of both the parties, one of the said matters was referred for
mediation. It has been further submitted that thereafter, both the parties arrived at
an amicable settlement and settled all the pending disputes between them for a
sum of Rs. 16,00,000 in full and final settlement (to be paid in installments) vide
mediation settlement deed dated 19.11.2018. It has been further submitted that the
accused had handed over 75 postdated cheques to the complainant in compliance
of the said mediation agreement.
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17. Based on the above, it has been contended that the accused cannot be held liable
since all the disputes between the parties (including the present matter) had been
settled in mediation and execution of the said mediation settlement agreement led
to extinguishment of the original cause of action and hence, the present complaint
could not have been continued with and ought to have been withdrawn.
18. In support of the said argument, learned counsel for the accused has cited the
following ratio from Gimpex (P) Ltd. v. Manoj Goel, 2021 SCC OnLine SC 925,
passed by the Hon'ble Supreme Court:
38. When a complainant party enters into a compromise agreement with the accused,
it may be for a multitude of reasons - higher compensation, faster recovery of money,
uncertainty of trial and strength of the complaint, among others. A complainant enters
into a settlement with open eyes and undertakes the risk of the accused failing to
honour the cheques issued pursuant to the settlement, based on certain benefits that
the settlement agreement postulates. Once parties have voluntarily entered into
such an agreement and agree to abide by the consequences of non-compliance of
the settlement agreement, they cannot be allowed to reverse the effects of the
agreement by pursuing both the original complaint and the subsequent
complaint arising from such non-compliance. The settlement agreement
subsumes the original complaint. Non-compliance of the terms of the settlement
agreement or dishonour of cheques issued subsequent to it, would then give rise
to a fresh cause of action attracting liability under Section 138 of the NI Act and
other remedies under civil law and criminal law. (Emphasis added)
19. In Gimpex (supra) also, a settlement agreement was executed and the accused, in
discharge of his liability under the settlement agreement, issued fresh set of
cheques, which were also dishonoured. The Hon'ble Supreme Court held that
dishonour of fresh set of cheques issued in compliance of the settlement
agreement would give rise to a fresh cause of action attracting liability under
Section 138 of the NI Act and other remedies under civil law and criminal law.
However, it was categorically held that the settlement agreement subsumes the
original complaint and hence, the original complaint cannot be proceeded with
once a settlement agreement has been executed.
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20. Therefore, as held in Gimpex (supra), a fresh cause of action arose once the
accused, in due performance of the mediation settlement agreement, gave a fresh
set of cheques to the complainant. During his cross-examination, the complainant
categorically admitted that he had executed the mediation settlement agreement
dated 19.11.2018 with the accused. He further admitted that he had received 75
PDCs in compliance of the said mediation agreement and that the said settlement
agreement was executed for all the pending disputes, including the present
complaint.
21. Therefore, since the present complaint was also covered within the scope of the
mediation settlement agreement, the complainant's original cause of action got
extinguished and hence, the present complaint is not maintainable. The only
contention of the complainant is that the cheques issued in compliance of the
mediation settlement agreement have also been dishonoured and the complainant
has terminated the mediation settlement agreement due to the constant non-
compliance of the same by the accused. However, as held by the Hon'ble
Supreme Court in Gimpex (supra), in case of non-compliance of the mediation
settlement agreement, the remedy available to the complainant is to institute fresh
complaints for dishonour of the cheques which were given in compliance of the
mediation settlement agreement or file civil suits for breach of the mediation
settlement agreement. Therefore, considering the binding precedent of Gimpex
(P) Ltd. v. Manoj Goel, 2021 SCC OnLine SC 925, the present complaint is not
maintainable.
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F. CONCLUSION
22. In the backdrop of the above discussion, I am of the considered opinion that the
complaint is not maintainable against the accused.
23. In the result of analysis of the present case, the accused Anowar Hussain is
hereby acquitted from the charge of offence punishable under Section 138 of the
Negotiable Instruments Act. Accused is directed to furnish bail bond and surety
bond in terms of section 437-A CrPC.
ORDER :- ACQUITTED.
DEVANSH Digitally signed by DEVANSHU SAJLAN U SAJLAN Date: 2022.07.30 20:40:43 +05'30' Announced in the Open (Devanshu Sajlan) Court on 30.07.2022 MM (NI Act-05), West, THC Delhi CC No. 2436/18 Har Kishan Soni v. Anowar Hussain. 11 of 11