Delhi District Court
In Matter Of "Krishna Janardhan Bhat vs . Dattatraya G. Hegde" on 24 June, 2022
IN THE COURT OF RAHUL JAIN,
METROPOLITAN MAGISTRATE - 04, N. I. ACT,
SOUTHWEST DISTRICT, DWARKA DISTRICT COURTS, DELHI.
JUDGMENT
Govind ....................Complainant
Versus
Satbir Singh ....................Accused
PS J.P. Kalan.
Under Section 138 of N. I. ACT, 1881
a) Sl. No. of the case : CT No. 362/2019
b) Name of the complainant : Govind
S/o Sh Gajraj Singh,
R/o V.P.OKhera Dabar, New Delhi.
c) Name of the accused person(s) : Satbir Singh
S/o Sh.Roop Chand,
R/o V.P.O Khera Dabar, New
Delhi
d) Offence complained of : Under Section 138 of N. I. Act, 1881
e) Plea of accused : Pleaded not guilty
f) Final order : Convicted
h) Date of such order : June, 24, 2022.
BRIEF STATEMENT OF THE REASONS FOR DECISION :
1. Vide this judgment, this Court shall dispose off complaint for offence punishable under Section 138 of The Negotiable Instruments Act, 1881 filed by the complainant Mr. Govind against accused namely Satbir Singh. In gist, it is alleged in complaint that the complainant, who is employed in Delhi Police, is known to the accused and his son Mr. Anand and having friendly relations for last few 3 years. The accused and his son are engaged in the business of water bottling and ice Govind v. Satbir Singh 1 of 14 manufacturing. In the month of October, 2018 the accused approached complainant and expressed that his son wants to diversify in his business and indulge into job work of logo printing on mobile phones, ear phones etc., and for the purpose the accused need a huge sum of money. In the context, the accused asked for a cash loan of Rs. 3,00,000/ to purchase a machine for logo printing. Due to close friendly relations, the complainant obliged the accused by arranging cash loan of Rs. 3 Lakh and gave it to the accused on 03.10.2017. The accused also acknowledged the same in writing in the form of an affidavit dated 03.10.2017, Ex. CW1/5 the accused assured the complainant that he will return the said amount after 11 months. The accused also issued two undated blank cheques bearing Nos. 000083 & 000084 both drawn on HDFC Bank, Najafgarh, New Delhi as security which are the cheques in question Ex. CW1/1 (Colly). Again on next day, the accused demanded further amount of R s. 3,00,000/ which complainant also obliged by paying further sum of Rs. 2,00,000/ was directly transferred, on behalf of the accused, on 05.10.2017 in the account of Mrs. Sunita Pandita W/o Mr. Deleep Pandita. Mr. Deleep Pandita being the V.P. Sales and marketing of Ms. Hitech Printing and Marketing Technologies having office at WZ 1108, Ground Floor, Near Shiv Mandir, Basai Bahrapur, New Delhi110015 having business of manufactures of Fiber Laser Marketing Machines, Pad Printing Machine, Fiber Laser Cutting Machine etc. Another sum of Rs. 1,00,000/ was transferred in account of the accused on 07.10.2017. In December, 2017, the accused further needed a sum of Rs. 1,50,000/ and again the complainant obliged the accused by transferring a sum of Rs. 1,50,000/ in the account of the accused on 08.12.2017. Vide writing dated 03.10.2017, the accused has assured that he will make the repayment/ loan amount on or before 11 months. While taking further loans on 05.10.2017, 07.10.2017 Govind v. Satbir Singh 2 of 14 and 08.12.2017, the accused has assured that the cheques given in security vide writing dated 03.10.2017 shall also be valid for all the amounts given by the complainant. After the elapse of 11 months the complainant approached the accused in the month of October, 2018 or the repayment of the aforesaid loan amount given to him. In order to discharge the liability the aforesaid total loan amount of Rs. 7,50,000/ ( Rupees Seven Lakhs Fifty Thousand) i.e. Rs. 3 Lakh on 03.10.2017 + Rs. 2 Lakhs on 05.10.2017 + Rs. 1 Lakh on 07.10.2017 + Rs. 1,50,000/ on 08.12.2017 accused asked the complainant to consider the cheques bearing No. 000083 and 000084 drawn on HDFC Bank, Najafgarh, New Delhi which are the cheques in question good for payment and asked the complainant to deposit the same on 20.11.2018 for a sum of Rs. 5 Lakhs and Rs. 2.5 Lakhs respectively for encashment. Complainant presented the cheques, but same were dishonored vide memo Ex.CW1/2 with reasons 'insufficient funds'. The complainant sent a legal demand notice dated 05.12.2018 vide Ex.CW1/3 via postal receipt Ex.CW1/4 (Colly.) and since no reply or payment was made within statutory period of legal demand notice, hence, this complaint.
PRESUMMONING EVIDENCE & NOTICE
2. Presummoning evidence was led by the complainant side and after hearing complainant side, accused was summoned for offence punishable under Section 138 of The Negotiable Instruments Act, 1881. After appearance of accused, it was ensured that copy of complaint has been supplied. Notice was put to the accused by my scholarly predecessor for offence punishable under Section 138 of The Negotiable Instruments Act, 1881 on 04.11.2014 wherein he denied having taken any loan from the complainant. The accused defended that he had not taken any loan from Govind v. Satbir Singh 3 of 14 the complainant. He is the driver by profession and used to keep blank signed cheques at his home for emergency. Further, he stated that the cheques in question came into the possession of the complainant through his son namely Mr. Anand Prakash. He stated that he does not know why the cheques in question were given to the complainant and he is not aware any transaction between his son and the complainant. Thereafter, matter was fixed for complainant's evidence and accused side was granted opportunity to crossexamine the complainant's evidence. COMPLAINANT'S POST NOTICE EVIDENCE
3. Complainant stepped in witness box as CW1 adopted his affidavit of presummoning as his evidence reiterating almost all facts of complaint, stating all exhibits available on record and in gist in his crossexamination he deposed that accused sought loan and the same was advanced due to close relation between the parties. In his cross examination, the complainant stood by his complaint and he reiterated the entire facts stated in the complainant. However, he stated that he knows the accused since 1999. He deposed that he gave 03 lakh in cash for which the accused has admitted in the affidavit Ex. CW1/5 and the remaining 4.5 Lakh was transferred in the account of Sunita Pandita and the accused. He also admitted that he did not disclose the details of the said loan in the disclosure given to the department every year as he was working in Delhi Police as Head Constable at FRRO, Office R.K. Puram, Delhi.
4. Complainant closed his postnotice evidence vide order dated 30.03.2022 and thereafter, matter was fixed for recording statement of accused. STATEMENT OF ACCUSED
5. The statement of accused was recorded under Section 313 of The Code Govind v. Satbir Singh 4 of 14 of Criminal Procedure, 1973 read with Section 281 of The Code of Criminal Procedure, 1973 separately on 30.03.2022. Incriminating evidence was put to him. Accused denied all the allegations and stated that he never availed any loan from the complainant. He denied his signature in the affidavit Ex. CW1/5. He reiterated his defence taken at the time of notice u/s 251 Cr.P.C. that he used to keep blank signed cheques at his home. However, he admitted transaction between his son, complainant and some third person in relation to logo printing business. He further admitted the cheques might have been given by my son in respect of the same transaction.
6. Accused was given opportunity to lead defence evidence and he entered into the witness box. He deposed that he used to come on 23 months and that is why he used to keep blank signed cheques at home for emergency, he denied any loan taken from the complainant and issuing the cheques in question to the complainant. He alleged that the complainant might have stolen the same. However, he admitted that the complainant and his son are friend since childhood. In his crossexamination, the accused admitted that he is in business of water bottling. But he denied all the suggestions related the advancement of loan on 03.10.2017, 05.10.2017, 17.10.2017 and 08.12.2017. He further denied issuing the cheques in question and discharge the above said liability. He admitted the signatures on the cheques but denied the signature on the affidavit Ex. CW1/5. Next the accused called his son into the witness box namely Anand Prakash as DW2. He deposed that he had started a business at Neemrana with the complainant of logo printing in which they were three partner, complainant, Hemant Kumar and he himself. He further deposed that they used the account of his father for business transaction as he and Hemant were unemployed and arranged only cash. Further, he deposed that the transaction with the account of his Govind v. Satbir Singh 5 of 14 father was related to the logo printing business. In his crossexamination, he admitted that the logo printing machine was purchased from Sunita Pandita. He was asked a specific court question at the end of the crossexamination that did you used to keep blank singed cheques of your father for business transaction to which the witness answered " No". The Defence Evidence was closed on 04.05.2022.
7. Final arguments from both sides heard on 20.05.2022. Case file perused. POINTS FOR DETERMINATION : 8.1 Whether the complainant has been able to establish ingredients of offence punishable under Section 138 of The Negotiable Instruments Act, 1881 beyond shadow of reasonable doubt against the accused or not? 8.2 Final order.
APPRECIATION OF FACTS/CONTENTIONS/ANALYSIS & FINDINGS
9. To bring home conviction for offence punishable under Section 138 of The Negotiable Instruments Act, 1881, the complainant is obliged to prove :
(a) The cheque(s) was/were drawn/issued by the accused person(s) to the complainant on an account maintained by him/her/them/it with the bank for discharge, in whole or in part, of any debt or liability.
(b) The cheques(s) was/were presented to the bank within a period of six months or within period of its/their validity.
(c) The cheque(s) so presented for encashment was/were dishonored.
(d) The payee/complainant of the cheque(s) issued a Legal Demand Notice within 30 days from the receipt of information from the bank Govind v. Satbir Singh 6 of 14 regarding dishonourment of the cheque(s).
(e) The drawer of the cheque(s) failed to make the payment within 15 days of receipt of aforesaid Legal Demand Notice.
(f) The complaint was presented within 30 days after the expiry of above 15 days.
UNDISPUTED/UNCONTROVERTED FACTS
10. At the outset, it is pertinent to mention herein that it is not in dispute that cheques in question belong to the accused, it bears his signatures, it was drawn on an account maintained by the accused with a bank and cheque in question was dishonored as alleged. So, there is no need of discussion qua said ingredients and same can be regarded as being duly proved on record and being noncontroverted. CONTENTIONS QUA LEGAL DEMAND NOTICE 11.1(a) The first major contention which has been raised by accused in this matter is that accused has not received any legal demand notice, therefore, ingredients of offence punishable under Section 138 of The Negotiable Instruments Act, 1881 are not complete, hence accused should be acquitted in this matter. 11.1(b) Per contra, it is contention of the complainant side that the legal demand notice was sent to the accused on his correct address, therefore, accused should be held guilty in this matter.
11.2 Submissions of both sides considered.
This Court sees no substance in this defence of accused side. Once, it is not disputed and proved on record that the legal demand notice was sent to correct address of the accused then the defence of the accused side that accused side has not Govind v. Satbir Singh 7 of 14 received any legal demand notice is no defence in the eyes of law in view of the judgment passed by Hon'ble Supreme Court of India in matter of "C. C. Alavi Hazi Vs. Palapetty Mohd. & Anr." reported in (2007) 6 Supreme Court Cases 555. In said judgment, Hon'ble Supreme Court of India has held that : "Any drawer who claims that he did not received the notice sent by post, can, within 15 days of receipt of summons from the court in respect of complaint Under Section 138 of the Act, make the payment of the cheque amount and submit to the court that he had made the payment within 15 days of the receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complainant is liable to be rejected. A person who does not pay within 15 days of receipt of summons from the court alongwith the copy of complaint Under Section 138 of the Act, can not 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 G. C. Act and 114 of the Evidence Act."
In this case, since, the accused side has not made payment of cheque(s) amount in question within 15 days of the receipt of summons of this Court, therefore, in the light of abovesaid judgment and discussions, this Court is of the opinion that defence of the accused side that he has not received any legal demand notice is without any force and is hereby rejected.
CONTENTIONS QUA CONSIDERATION 12.1(a) The contentions which have been raised by defence is that he never availed a loan of Rs.7,50,000/ (Rupees Seven Lakhs fifty thousand only) as alleged. The cheques were stated to have been given by the son of the accused to the complainant.
It is the contention of defence that the complainant admitted having not disclosed about the present transaction in his disclosure of assets and liabilities given to the Police department every year and has not even proved his income and therefore the accused side has been able to rebut the presumption of consideration available in Govind v. Satbir Singh 8 of 14 favour of the complainant as there was no consideration in question. It is contended that accused should be acquitted in this matter.
12.1(b) On the other hand, it is the contention of the complainant side that accused has taken multiple defences without proving any. It is argued that the accused has merely denied every allegation. It was argued that the accused has merely denied having signed the Ex.CW1/5, has merely stated that the same must have been stolen without showing any proof of protest or complaint of misuse of cheque. The complainant thus argued that the accused has not put any probable defence. The complainant further submitted that the accused drew the present cheque in discharge of the liability, hence, all ingredients of commission of offence punishable under Section 138 of The Negotiable Instruments Act, 1881 stands established on record, therefore, accused should be held guilty in this matter.
12.2 Submissions of both side considered.
Section 118 (a) of The Negotiable Instruments Act, 1881 provides as under : "Section 118. Presumption as to negotiable instruments. Until the contrary is proved, the following presumption shall be made:
(a) of consideration that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, was indorsed, negotiated or transferred for consideration;........."
Section 139 of The Negotiable Instruments Act, 1881 provides as under : "Section 139 Presumption in favour of holder. 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."
In matter of "Krishna Janardhan Bhat Vs. Dattatraya G. Hegde"
(2008) 4 SCC 54, Hon'ble Supreme Court of India has observed : Govind v. Satbir Singh 9 of 14 "32. An accused for discharging the burden of proof placed upon him under a statute need not examine himself. He may discharge his burden on the basis of the materials already brought on record. An accused has a constitutional right to maintain silence. Standard of proof on the part of the accused and that of the prosecution in a criminal case is different."
"34. Furthermore, whereas prosecution must prove the guilty of an accused beyond all reasonable doubt, the standard of proof so as to prove a defence on the part of the 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 relies."
In matter of "Mallavarapu Kasivisweswara Rao Vs. Thadikonda Ramulu Firm" (2008) 7 SCC 655, Hon'ble Supreme Court of India (though it was a civil matter related to promissory note, but is relevant to refer herein) has held : "17. Under Section 118 (a) of the Negotiable Instruments Act, the court is obliged to presume, until the contrary is proved, that the promissory note was made for consideration. It is also a settled position that the initial burden in this regard lies on the defendant to prove the nonexistence of consideration by brining on record such facts and circumstances which would lead the court to believe the nonexistence of the consideration either by direct evidence or by preponderance of probabilities showing that the existence of consideration was improbable, doubtful or illegal."
In matter of "Bharat Barrel & Drum Mfg. Co. V. Amin Chand Payrelal" (1999) 3 SCC 35, Hon'ble Supreme Court of India (though it was also a civil matter related to promissory note, but is relevant to refer herein) has held : "12. Upon consideration of various judgments as noted hereinabove, the position of law which emerges is that once execution of the promissory note is admitted, the presumption under Section 118 (a) would arise that it is supported by a consideration. Such a presumption is rebuttable. 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 that 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. The burden upon the defendant of proving the non existence of the consideration can be either direct or by bringing on record the preponderance of probabilities by reference to the circumstances upon which he relies. In such an event, the plaintiff is entitled under the law to rely upon all the Govind v. Satbir Singh 10 of 14 evidence led in the case including that of the plaintiff as well. In case, where the defendant fails to discharge the initial onus of proof by showing the nonexistence of the consideration, the plaintiff would invariably be held entitled to the benefit of presumption arising under Section 118 (a) in his favour. The court may not insist upon the defendant to disprove the existence of consideration by leading direct evidence as the existence of negative evidence is neither possible nor contemplated and even if led, is to be seen with a doubt. The bare denial of the passing of the consideration apparently does not appear to be any defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the plaintiff. To disprove the presumption, the defendant has to bring on record such facts and circumstances upon consideration of which the court may either believe that the consideration did not exist or its nonexistence was so probable that a prudent man would, under the circumstances of the case, shall act upon the plea that it did not exist."
In matter of "Rangappa Vs. Sri Mohan" (2010) 11 SCC 441 which is a Full Bench Decision, Hon'ble Supreme Court of India while discussing above said provisions, judgments and other case law on the point has held : "26. In light of these extracts, we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. To the extent, the impugned observations in Krishna Janardhan Bhat may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant".
"27. Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the defendantaccused cannot be expected to discharge an unduly high standard or proof."
"28. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption Govind v. Satbir Singh 11 of 14 under Section 139, the standard of proof for doing so is that of "preponderance of probabilities". Therefore, if the accused is able to raise a probable defence which creates doubt about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own."
12.3 So, precisely there is initial presumption of legally enforceable debt or liability against the accused side, but same is rebuttable. The standard of proof for rebuttal is preponderance of probabilities. Accused side can lead evidence in defence, even can rely on materials submitted by complainant and can rely upon circumstances also to show nonexistence of consideration or it being improbable and need not adduce evidence of his own for the same.
12.4 The defence of the accused side considered in view of abovecited case laws. The initial defence of the accused has been that the cheque must have been stolen and he never availed any loan from the complainant. The accused denied having signed the acknowledgement cum affidavit Ex.CW1/5. The accused admitted in his statement u/s 313 Crpc that cheque might have been given by his son in respect of the transaction between his son and complainant in relation to logo printing business. However, in his statement on oath u/s 315 Cr.P.C. he deposed that complainant might have stolen the cheques as the complainant and his son ere friends since childhood and complainant used to visit his house. Now, the accused has verbally denied the allegations without any substantive proof. Rather, the documentary evidence on record contradicts his version. The accused has just verbally denied his signatures on the affidavit cum acknowledgement Ex. CW1/5. The accused has not taken any efforts to Govind v. Satbir Singh 12 of 14 disprove his signatures on the document. He could have at the very least called handwriting expert to disprove the same. But given the fact that the accused has admitted his signatures on the cheques, I use my powers u/s 73 Evidence Act and compare the admitted signatures with the disputed signatures. Upon comparison, I find the both to be similar with the same handwriting pattern. In view of the fact that there is no other expert evidence on record to disprove the same, I adjudge the same the affidavit to have been signed by the accused himself.
The affidavit cum acknowledgement has now very well established the loan transaction of Rs. 3,00,000/ taken place on 03/10/2017. Regarding the other transactions dated 5/10/2017, 07/10/2017 and 08/12/2017 the complainant has placed on record his bank account statement showing the transactions in the respective accounts of Sunita Pandit and accused. The same has gone unchallenged by the accused. The accused has just verbally denied all those transactions. 12.5 There is no force in the defence of the accused that cheques might have been given by his son in relation to some business transactions in relation to logo printing business with the complainant and some third person namely Hemant Kumar. Also, his son in his cross examination as DW2 admitted to having purchased logo printing machine from Sunita Pandit. He also answered in negative to the court question as to whether he used to keep blank signed cheques of his father for business transaction. Thus, there is no chain established in the defence as to how the cheques might have come to the possession of the complainant.
12.6 Lastly, it is unnatural to believe that the accused having lost two of his cheques will not take any steps to request his bank to stop payment qua those cheques.
Govind v. Satbir Singh 13 of 14 Even so, if the said cheques are known to have been misused, accused would not report or raise any protest. The accused's deposition and complete denial does not adduce confidence of this Court and even not sufficient to raise probable defence sufficient enough to tilt the balance of probabilities in his favour. 12.7 From the above discussion, a presumption exists in the favour of the complainant and it is the accused that is to discharge the onus. The accused has miserably failed to discharge the same. The accused firstly has been acting so gullible that he used to keep blank signed cheque in his home and even when his cheques are missing, he does not take any action to save himself. The accused has taken one defence of absolute denial and he has not answered any evidence incriminating him in the present case. The accused also took the defence that the cheques might have been given by his son in relation to some transaction with the complainant in logo printing business but that defence has been just hollow averments without any oral or documentary evidence t raise a probable defence. Rather, in the face of documentary evidence on record on behalf of complainant this defence seems totally unworthy of credit.
12.8 Thus, the accused has not been able to rebut the presumption even by any probable defence. A mere statement that the cheque was blank and must have been stolen does not discharge the onus on the accused. The accused has not shown any cogent evidence to show that the cheque was not against any liability. The same is supported by the reasoning delivered by the Hon'ble Supreme Court dated 15.03.2019 in Rohitbhai Jivanlal Patel v. State of Gujarat & Anr., Criminal Appeal no. 508 of Govind v. Satbir Singh 14 of 14 2019. Moreover, the accused did not protest filing of the present complainant, nor any police complainant was filed promptly against the alleged misuse of the present cheque in question. Even though the legal demand notice was issued and served on the accused in, however, no protest or police complainant was filed. In the light of the documentary evidences adduced by the complainant and mere verbal statement of the accused, the defence is not tenable.
FINAL CONCLUSION
13. It stands established on record in the form of evidence of the complainant given vide affidavit (which can be read in evidence at all stages as per judgment of "Rajesh Agarwal Vs. State & Anr." 171 (2010) DELHI LAW TIMES
51), documents exhibited in evidence, admission(s) of accused during notice/accusations explained to him and statement of accused recorded under Section 313 of The Code of Criminal Procedure, 1973 read with Section 281 of The Code of Criminal Procedure, 1973 that complainant provided loan to the accused and then, accused issued cheque in question for discharge of their liability, cheque got dishonored on presentment, complainant served legal demand notice upon accused demanding the cheque amount in question, however, accused failed to make the said payment within statutory period despite service. So, all the ingredients of offence punishable under Section 138 of The Negotiable Instruments Act, 1881 stands established on record. The defence(s) raised by accused side are not sustainable as per above discussions.
FINAL ORDER
14. In view of the aforementioned facts and circumstances, this Court is of the opinion that complainant has duly proved its case against the accused for offence Govind v. Satbir Singh 15 of 14 punishable under Section 138 of The Negotiable Instruments Act, 1881 beyond shadow of any reasonable doubt. Accordingly, accused namely Satbir Singh stands convicted for offence punishable under Section 138 of The Negotiable Instruments Act, 1881.
Announced in the open Court on 24 June, 2022.
(RAHUL JAIN) MM (NI) ACT04, DWARKA COURTS NEW DELHI 24.06.2022 Govind v. Satbir Singh 16 of 14