Delhi District Court
Rapid Diagnostic vs M V Premanath Cc No.5031/2010 on 5 December, 2011
IN THE COURT OF SH. RAKESH KUMAR SINGH:
METROPOLITAN MEGISTRATE (NI ACT)-1, CENTRAL:
ROOM NO.-42, TIS HAZARI COURT COMPLEX, DELHI
05.12.2011
Rapid Diagnostic vs M V Premanath CC No.5031/2010
ORDER
It is proposed to dispose off the application filed by the accused u/s 145(2) NI Act.
On facts:
2. On the following grounds, the accused claimed a right of cross examination:
Out of the 17 cheques, 14 cheques were not honoured however payment of the same was subsequently made by demand drafts in the months of December-2003 to March-2004.
The said payment was made prior to the second presentation of the cheques.
So far as three cheques are concerned, the payment thereof was stopped due to some valid reasons.
Equipments supplied by the complainant was facing problems right from the beginning and this fact was informed to the complainant.
In such circumstances, accused did not receive any payment from his customer and therefore he also stopped the payment to the complainant.
Accused had sent a reply of the legal demand notice. However, complainant concealed the same.
2.1. From the abbe story, following points become clear:
Cheques in question were given by the accused to the complainant.
Rapid Diagnostic vs M V Premanath CC No.5031/2010 1 There was business dealings between the parties.
Complainant had supplied the materials.
2.2. A bare look at the grounds taken by the accused goes to show that they are self contradictory. If equipments supplied by the complainant were not working properly from the beginning, accused does not have any explanation for the payments allegedly made by several demand drafts. If such equipments were giving problems from beginning, the accused ought not to have further the same for his customers. If equipments were defective, accused ought to have returned the goods to the supplier i.e. the complainant or at least intimated the complainant about rejection of delivery. However, accused was using such equipments that was clearly inconsistent with the ownership of the seller.
Section-42 of Sale of Goods Act reads as: Acceptance.- The buyer is deemed to have accepted the goods when he intimates to the seller that he has accepted them, or when the goods have been delivered to him and he does any act in relation to them which is inconsistent with the ownership of the seller, or when, after the lapse of a reasonable time, he retains the goods without intimating to the seller that he has rejected them.
If complainant was not hearing problem of the accused, he ought to have taken legal recourse against the complainant. Again if payment was made after the first presentation, the accused should have demanded the cheques and on the failure of the complainant in so doing, the accused ought to have lodged criminal complaint against the complainant.
2.3. Above conduct of the accused without any concrete support can not stand the test of a reasonable prudent man. Factum of payment and reply is in the special knowledge of the accused. He should prove such facts. (see discussion hereinafter).
3. During the arguments. ld. counsel for the accused stated that accused is having proof of payments and he wants to confront the same to the complainant. Ld. counsel for the complainant vehemently opposed the contention on the grounds that accused has not filed any such thing with the application and that both the alleged things i.e. the factum of payment and reply of legal demand notice are in the special knowledge of the accused and therefore he should establish the same.
Rapid Diagnostic vs M V Premanath CC No.5031/2010 2
4. Ld. counsel for the accused instead of satisfying the court in this regard contended that accused is not required to show anything or to give any reasons for the cross-examination and if accused moves an application, the Court is bound to call the complainant for his cross-examination. Ld. counsel for the accused has relied upon the legal issue in such manner as if factual position is irrelevant.
Ld. Counsel for the accused to support his contention has relied upon M/s Mandvi Co-op Bank Ltd vs Nimesh B Thakore 2010 I AD (SC) 599, Som Nath Sapra vs State And Anr. 2003 CriLJ 4282, Vishnu Bhagwan vs State, 82 (1999) DLT 820, Magma Leasing Ltd. vs State Of West Bengal And Ors. 2007 (3) CHN 574.
On Legal Issue:
5. In my considered view, the contention of the ld. counsel is untenable and reliance placed upon the judgments are misconceaved. I have dealt with this contention several times in other cases. Ld. counsel has not contended anything new except citing of two additional judgments i.e. Som Nath Sapra and Vishnu Bhagwan. Unfortunately, even these two judgments are of no help for the accused. Therefore, in my considered view, accused can not claim cross-examination as a matter of right. I am providing the reasons in detail.
6. In Rajesh Agarwal vs State decided on 28.07.2010, Hon'ble High Court of Delhi has observed that:
"9. An argument is raised that the accused, under Article 21 of Constitution of India, has a right of silence in a criminal trial and therefore he cannot be forced to disclose his defence. This argument is misconceived in view of Section 106 of Indian Evidence Act. Since an offence under section 138 of Negotiable Instrument Act is technical in nature and defence which an accused can take are inbuilt, like the cheque was given without consideration, the accused was not Director at that time, accused was a sleeping partner or a sleeping Director, cheque was given as a security etc. etc., the onus of proving these defences is on the accused alone, in view of section 106 of Evidence Act. Since the mandate of Legislature is trial of such cases in a summary manner, the evidence already given by the complainant by way of affidavit is sufficient proof of the offence and this evidence is not required to be given again in terms of section 145(1) of N.I. Act and has to be read during the trial. The witnesses Rapid Diagnostic vs M V Premanath CC No.5031/2010 3 i.e. the complainant or other witnesses can be recalled only when accused makes an application and this application must disclose the reason why accused wants to recall the witnesses and on what point witness is to be cross examined. One must not forget that the offence under section 138 of N.I. Act is not of the kind of offence as in IPC where the State prosecutes a person for offence against the society. The offence under section 138 of N.I. Act is an offence in the personal nature of the complainant and it is an offence made under N.I. Act so that the trust in commercial transactions is not destroyed because of the dishonour of cheques. When it is within the special knowledge of the accused as to why he is not to face trial under section 138 N.I. Act, he alone has to take the plea of defence and burden cannot be shifted to complainant. There is no presumption that even if an accused fails to bring out his defence, he is still to be considered innocent. If an accused has a defence against dishonour of the cheque in question, it is he alone who knows the defence and responsibility of spelling out this defence to the court and then proving this defences is on the accused. I, therefore, consider that the proper procedure to be followed by MM is that soon after summoning, the accused must be asked to disclose his defence & his plea should be recorded. Where an accused takes no defence and simply says "I am innocent", there is no reason for the MM to recall the complainant or witnesses during summary trial and the evidence already given by the complainant has to be considered sufficient and the trial court can ask the accused to lead his evidence in defence on the plea of innocence as the evidence of the complainant is already there. In a summary trial, a complainant or his witness cannot be recalled in the court for cross examination only for the sake of pleasure. Once the complainant has brought forward his case by giving his affidavit about the issuance of cheque, dishonour of cheque, issuance of demand notice etc., he can be cross examined only if the accused makes an application to the court as to on what point he wants to cross examine the witness (es) and then only the court shall recall the witness by recording reasons thereto."
One may say that Section-106 Evidence Act does not relive the prosecution from its preliminary duty. True.
In State Of West Bengal versus Mir Mohammad Umar: 2000SCC(Cr) 1516 it has been held as follows:-
"36. In this context we may profitably utilise the legal principle embodied in Section 106 of the Evidence Act which reads as follows : "When any fact is especially within the knowledge of any person, the burden of proving that fact is upon him."
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37. The section is not intended to relieve the prosecution of its burden to prove the guilt of the accused beyond reasonable doubt. But the Section would apply to cases where the prosecution has succeeded in proving facts from which a reasonable inference can be drawn regarding the existence of certain other facts, unless the accused by virtue of his special knowledge regarding such facts, failed to offer any explanation which might drive the Court to draw a different inference."
In cheque bounce cases, however, the complainant has to prove the following facts(apart from legal notice and dishonour):
(i) There is a legally enforceable debt.
(ii) The drawer of the cheque issued the cheque to satisfy part or whole of the debt.
(iii) The cheque so issued has been returned due to insufficiency of funds.
Last fact is not in dispute in the present case. So far as first two facts are concerned, the same are matter of mandatory presumptions of law. Earlier in Krishna Janardhan Bhat v. Dattatraya G. Hegde, (2008) 4 SCC 54 held that only second fact is covered under the presumptions available u/s-139 NI Act. However, recently a three judges bench of the Hon'ble Supreme Court in Rangappa Vs. S. Mohan decided (2010) 11 SCC 441 has considered the dictum of Krishna Janardhan Bhat(supra), and overruled the view so far as existence of liability is concerned, by observing therein that:
"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 that extent, the impugned observations in Krishna Janardhan Bhat (supra) 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. "
In Rangappa(supra), the case of the accused was that of a lost cheque. However initially, the High Court dealing with matter had held that:
Rapid Diagnostic vs M V Premanath CC No.5031/2010 5 '6. Once the cheque relates to the account of the accused and he accepts and admits the signatures on the said cheque, then initial presumption as contemplated under Section 139 of the Negotiable Instruments Act has to be raised by the Court in favour of the complainant. The presumption referred to in Section 139 of the N.I. Act is a mandatory presumption and not a general presumption, but the accused is entitled to rebut the said presumption. What is required to be established by the accused in order to rebut the presumption is different from each case under given circumstances. But the fact remains that a mere plausible explanation is not expected from the accused and it must be more than a plausible explanation by way of rebuttal evidence. In other words, the defence raised by way of rebuttal evidence must be probable and capable of being accepted by the Court. The defence raised by the accused was that a blank cheque was lost by him, which was made use of by the complainant. Unless this barrier is crossed by the accused, the other defence raised by him whether the cheque was issued towards the hand loan or towards the amount spent by the complainant need not be considered. ...' The judgment of conviction upon the above basis recorded by the Hon'ble High Court was finally upheld by the Hon'ble Supreme Court in Rangappa (supra).
Clearly, once signature is accepted by the accused, necessary ingredients become established by the mandatory presumptions of law. Complainant has (at the time of acceptance of signature by the accused) established the foundational facts and is now relived from its preliminary duty. Now Section-106 Evidence Act can be made applicable.
It has to be established that the case of the accused comes under the said proviso. A complainant can not be asked to establish the fact that her case does not fall under the said proviso. It is like Section-105 Evidence Act wherein burden to establish the general or special exception lies upon the accused and not upon the complainant. For that section, the prosecution is required to establish the commission of offence and then accused is required to establish the exception. Similarly, here, the complainant is required to establish that the cheuqes are in his name and given by the accused and the accused is required to rebut the presumptions.
It has to be noted that presumptions under Section-139 NI Act is entirely in favour of the Rapid Diagnostic vs M V Premanath CC No.5031/2010 6 complainant. More so when complainant has also relied upon loan agreement/undertakings signed by the accused and accused has failed to dispute such loan agreement/undertakings.
6.1. It is not as if opportunity is not available with the accused to establish his defence or to rebut the mandatory presumptions of law. Accused can definitely do so in his defence.
7. Apart from the above, a mere denial of consideration is not sufficient. In Bharat Barrel & Drum Manufacturing Company v. Amin Chand Pyarelal, (1993) 3 SCC 35 (Para. 12) it has been held that:
"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 improbably 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 law to rely upon all the 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 non-existence 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 non-existence was so probable that a prudent man would, under the circumstances of the case, act upon the plea that it did not exist."
Rapid Diagnostic vs M V Premanath CC No.5031/2010 7 7.1. A mere explanation is also not sufficient. If conduct of the accused has not been in conformity with the conduct of a reasonable prudent businessman, his mere explanation can not be accepted without any supporting material.
"3. The appellant had taken a stand that no reply to the notice of legal demand was sent by the respondent, instead, envelopes with blank sheets in it were sent by the respondent. In her examination under Section 281 Cr. P.C. she did not deny issuance of cheques, but, took a defence that cheque were issued as security for seeking loan but no loan was advanced and the cheques were therefore without consideration. The learned MM observed that conviction under Section 138 of N.I. Act cannot be made acting on evidence of complainant and considering the presumption under Section 139 of N.I. Act. The complainant has to prove beyond reasonable doubt the debt or liability of the accused. Learned MM observed that complainant had not specified the date of giving loan and a reasonable man would remember the date of giving substantial sum of money as loan to other and this blissful forgetness of the date by the complainant raised doubt about the liability of the accused, more so, in view of the stand taken by the accused that the cheques were issued as security and the same were never returned.
*******
5. It must be borne in mind that the statement of accused under Section 281 Cr. P.C. or under Section 313 Cr. P.C. is not the evidence of the accused and it cannot be read as part of evidence. The accused has an option to examine himself as a witness. Where the accused does not examine himself as a witness, his statement under Section 281 Cr. P.C. or 313 Cr. P.C. cannot be read as evidence of the accused and it has to be looked into only as an explanation of the incriminating circumstance and not as evidence. There is no presumption of law that explanation given by the accused was truthful. In the present case, the accused in his statement stated that he had given cheques as security. If the accused wanted to prove this, he was supposed to appear in the witness box and testify and get himself subjected to cross examination. His explanation that he had the cheques as security for taking loan from the complainant but no loan was given should not have been considered by the Trial Court as his evidence and this was liable to be rejected since the accused did not appear in the witness box to dispel the presumption that the cheques were issued as security. Mere suggestion to the witness that cheques were issued as security or mere explanation given in the statement of accused under Section 281 Cr. P.C., that the cheques were issued as security, does not amount to proof. Moreover, the Trial Court seemed to be obsessed with idea of proof beyond reasonable doubt forgetting that offence under Section 138 of N.I. Act was a technical offence and the complainant is only supposed to prove that the cheques issued by the respondent were dishonoured, his statement that cheques were issued against liability or debt Rapid Diagnostic vs M V Premanath CC No.5031/2010 8 is sufficient proof of the debt or liability and the onus shifts to the respondent/ accused to show the circumstances under which the cheques came to be issued and this could be proved by the respondent only by way of evidence and not by leading no evidence. *******
7..............The Trial Court in this case turned a blind eye to the fact that every accused facing trial, whether under Section 138 of N.I. Act or under any penal law, when charged with the offence, pleads not guilty and takes a stand that he has not committed the offence. Even in the cases where loan is taken from a bank and the cheques issued to the bank stand dishonoured, the stand taken is same. Mere pleading not guilty and stating that the cheques were issued as security, would not give amount to rebutting the presumption raised under Section 139 of N.I. Act. If mere statement under Section 313 Cr. P.C. or under Section 281 Cr. P.C. of accused of pleading not guilty was sufficient to rebut the entire evidence produced by the complainant/ prosecution, then every accused has to be acquitted. But, it is not the law. In order to rebut the presumption under Section 139 of N.I. Act, the accused, by cogent evidence, has to prove the circumstance under which cheques were issued. It was for the accused to prove if no loan was taken why he did not write a letter to the complainant for return of the cheque. Unless the accused had proved that he acted like a normal businessman/prudent person entering into a contract he could not have rebutted the presumption u/s 139 N.I. Act. If no loan was given, but cheques were retained, he immediately would have protested and asked the cheques to be returned and if still cheques were not returned, he would have served a notice as complainant. Nothing was proved in this case."
7.2. Clearly, a mere explanation of the accused can not be accepted. It is settled that complainant can not be recalled merely for pleasure (vide Rajesh Aggarwal Vs. State decided on 28.07.2010 Hon'ble High Court of Delhi) and opportunity to cross examine the complainant can only be given if the defence requires such cross examination.
Hon'ble High Court of Delhi in Boby Kapoor Vs. M/s City Finance decided on 02.02.2011 has observed that:
"A case under Section-138 of NI Act is a summary trial proceeding. The right of cross-examination is given to the accused only if the accused discloses his defence at the time of taking notice and the Court considers that in order to meet the defence, cross-examination of witness was necessary. In the present case, the defence taken by the accused was that the cheque was a forged document. He had not taken Rapid Diagnostic vs M V Premanath CC No.5031/2010 9 the defence that he had not taken the loan and the loan agreement was not executed."
7.3. For the offence under Section-138 NI Act, it is not the complainant who has to establish the liability but it is for the accused to rebut the reverse onus. Mandatory presumptions of law arising under Section-118 & 139 NI Act are in favour of the complainant. Even the mandatory presumption also extends to the existence of legally enforceable debt or liability.
7.4. In my considered view, accused can not claim the right of cross examination on the basis of grounds raised in the application.
8. It however appears that accused wants to rely upon the expression "shall" appearing in Section-145(2) NI Act to contend that she has a right of cross-examination if she makes an application. Ground for this thinking is that legislature has used expressions "may" and "shall" in the same provision for two different situations and therefore "shall" must be treated as mandatory.
In my considered view, the reasoning itself is misconceived.
Hon'ble Supreme Court in Bachahan Devi & Anr. V. Nagar Nigtam, Gorakhpur & Anr. (2008) 12 SCC 372 has held that:
"Obviously where the legislature uses two words may and shall in two different parts of the same provision prima facie it would appear that the legislature manifested its intention to make one part directory and another mandatory. But that by itself is not decisive. The power of court to find out whether the provision is directory or mandatory remains unimpaired."
Hon'ble Supreme Court in Ganesh Prasad v. Lakshmi Narayan, AIR 1985 SC 964 has held that:
"Obviously where the legislature uses two words 'may' and 'shall' in two different parts of the same provision prima facie it would appear that the legislature manifested its intention to make one part directory and another mandatory. But that by itself is not decisive. The power of the court still to ascertain the real intention of the Legislature by care fully Rapid Diagnostic vs M V Premanath CC No.5031/2010 10 examining the scope of the statute to find out whether the provision is directory or mandatory remains unimpaired even where both the words are used in the same provision."
8.1. Clearly, we can treat the expression "shall" as directory even in the cases where "may" and "shall" are used in the same provision, of course the same can be only done if the circumstances so require.
However, ld. Counsel for the accused has contended that Section-145(2) NI Act is mandatory in nature and therefore once an application is filed, the opportunity of cross examination has to be allowed.
We have to see whether circumstances require that the "shall" should be read as mandatory or not.
8.2. Section-145 Negotiable Instruments Act reads as under:
"145. Evidence on affidavit.-
(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), the evidence of the complainant may be given by him on affidavit and may, subject to all just exceptions be read in evidence in any enquiry, trial or other proceeding under the said Code.
(2) The court may, if it thinks fit, and shall, on the application of the prosecution or the accused, summon and examine any person giving evidence on affidavit as to the facts contained therein."
It is clear that the evidence by way of affidavit given at the stage of pre summoning can be read in evidence in the trial.
8.3. Such witness can not be summoned unless an application is made by the accused (at this stage, there is no necessity to refer the right and discretion of the complainant and the Court).
Rapid Diagnostic vs M V Premanath CC No.5031/2010 11 It is apt to quote Hon'ble Supreme Court in M/s Mandvi Co-op Bank Ltd vs Nimesh B thakore, (2010) 3 SCC 83:
"What would be the extent and nature of examination in each case is a different matter and that has to be reasonably construed in light of the provision of section 145(1) and having regard to the object and purpose of the entire scheme of sections 143 to 146."
8.4. Here itself it will be useful to note following objects and reasons with which Section 145 of the N.I.Act has been introduced in the Act:
"The existing provisions in the Negotiable Instruments Act namely, Sections 138 to 142 in Chapter XVII have been found deficient in dealing with dishonour of cheques. Not only the punishment provided in the Act has proved to be inadequate, the procedure prescribed in the Courts to deal with such matters has been found to be cumbersome. The Courts are unable to dispose of such cases expeditiously in a time bound manner in view of the procedure contained in the Act."
8.5. Now the question is at what stage an application u/s-145(2) can be made?
8.6. Stages of the proceeding when accused is present:
i. Acquisition explained over to the accused;
ii. Plea of the accused;
iii. Admission denial of the documents of the complainant;
iv. Complainant's evidence;
v. Examination of the accused;
Rapid Diagnostic vs M V Premanath CC No.5031/2010 12
vi. Documents being placed on record by the accused;
vii. Admission denial of the documents of the accused;
viii. Defence evidence;
ix. Arguments;
x. Judgment.
8.7. No doubt when the accused makes an application, the Court has to summon the witness. However, it does not stand to reason that there can not be any restriction in respect of making of such application. Reason is obvious.
If accused makes an application at the stage when the judgment is to be pronounced, will the Court be powerless to dismiss such application? No one will answer the question in the negative.
8.8. The second question is can such application be made at the time of arguments? No. 8.9. The third question is can such application be made at the stage when the accused is required to lead defence evidence? I am afraid that such application if allowed would defeat the very purpose for which Section-145 has been enacted. Such application has to be dismissed.
8.10. Here it is worthy to note that Affidavit made u/s-145(1) NI Act is a complete evidence not requiring any cross-examination. Such affidavit in my considered view has to be equated with a situation wherein after the examination in chief, cross examination is recorded as 'nil'.
8.11. It may be noted that the term "evidence" as defined in Section 3 of the Indian Evidence Act 1872 means and includes (i) all statements which the Court permits or requires to be made before it by witnesses, in relation to matters of fact under inquiry and (ii) all documents produced for the inspection Rapid Diagnostic vs M V Premanath CC No.5031/2010 13 of the Court, The former is called "oral evidence" and the later "documentary evidence". The essential characteristics of a statement of a person to be considered evidence "as per the definition of the term is that (i) it must have been permitted or required to be made before it by a Court legally competent to so permit or require it to be made before it and (ii) such statement must have been made in relation to matters of fact under enquiry i.e., in other words, in the course of judicial proceedings. It therefore, necessarily follows that once the statement of a witness has been permitted or required to be made before it by a Court having jurisdiction to so permit or require the statement to be made in the course of a judicial proceeding pending before it, the statement made shall not lose its character of being "evidence" in such judicial proceedings and may be used for the adjudication of the rights and liabilities of the parties to and determination of the dispute in such judicial proceedings, unless mandated otherwise by the order of the Court or by the words of the statute.
8.12. This view can further be fortified by making a reference to Rule-4, Order-18 CPC:
Rule-4 of Order-18, CPC reads as under:
"4. Recording of evidence.-(1) In every case, the examination-in-chief of a witness shall be on affidavit and copies thereof shall be supplied to the opposite party by the party who calls him for evidence:
Provided that where documents are filed and the parties rely upon the documents, the proof and admissibility of such documents which are filed along with affidavit shall be subject to the orders of the Court.
(2) The evidence (cross-examination and re-examination) of the witness in attendance, whose evidence (examination-in-chief) by affidavit has been furnished to the Court, shall be taken either by the Court or by the Commissioner appointed by it:
Provided that the Court may, while appointing a commission under this sub-rule, consider taking into account such relevant factors as it thinks fit."
Rapid Diagnostic vs M V Premanath CC No.5031/2010 14 The term used for affidavit is examination in chief. The cross examination has to follow as a matter of course. Whereas, u/s-145, the expression used is 'evidence' and cross examination does not follow as a matter of course.
If the Parliament has used two different phrases for the similar matters in two different enactments, the differential intention must be recognized.
8.13. If by making merely an application, accused can cross examine the witness, the question to be asked is what was the necessity to introduce a different mode? A person giving evidence on affidavit in a civil suit has to be cross examined as a matter of course, what prohibited the Parliament from employing the same course to a person giving evidence on affidavit in a criminal trial that too when a person requires more protection in a criminal trial than in the civil trial?
8.14. The controversy may be discussed from another angle. Section-145(2) does not make any mention of the number of applications which an accused can make. Can the accused claim a right to make 'N' number of applications? Will the Court be powerless to reject such claim?
I consider that the Court is not powerless. Accused can not make any such claim. Such applications if made have to be dismissed.
8.15. Above discussion can show that though the Court has to summon the witness if an application is made u/s-145(2), the Court is not powerless to dismiss such applications in certain circumstances.
If the Court has power to dismiss an application made u/s-145(2), a fortiori, the Court has to have the power to decide the genuineness and necessity of such application.
8.16. Above discussion goes to show that in a special trial for the offence punishable under Section-138 NI Act, accused can not claim a right of cross-examination of the complainant's witness.
8.17. It is clear from the above discussion and the judgments of the Hon'ble High Court of Delhi (cited above) that accused can not claim an indefeasible right to cross examine a witness who has given Rapid Diagnostic vs M V Premanath CC No.5031/2010 15 his evidence by way of affidavit (only for the offence punishable under Section-138 NI Act and not in general criminal trial). Such witness can only be summoned when the accused shows sufficient justification for the cross examination of the witness. If contention of the ld. Counsel for the accused is accepted, the purpose for which section-143 & 145 NI Act have been enacted would be defeated.
Discussion on judgments cited by accused:
9.Ld. counsel for the accused has relied upon following portion from Mandavi Co-op. Bank Ltd(supra):
"21. Nevertheless, the submissions made on behalf of the parties must be taken note of and properly dealt with. Mr Ranjit Kumar, learned Senior Advocate, appearing for the appellant in appeal arising from SLP (Crl.) No. 4760/2006 pointed out that sub-section (2) of section 145 uses both the words, "may" (with reference to the court) and "shall" (with reference to the prosecution or the accused). It was, therefore, beyond doubt that in the event an application is made by the accused, the court would be obliged to summon the person giving evidence on affidavit in terms of section 145(1) without having any discretion in the matter. There can be no disagreement with this part of the submission but the question is when the person who has given his evidence on affidavit appears in court, whether it is also open to the accused to insist that before cross- examining him as to the facts stated in the affidavit he must first depose in examination-in- chief and be required to verbally state what is already said in the affidavit..."
At the first sight, ld. counsel for the accused seems to be right. However, a close scrutiny of the entire judgment goes to show otherwise.
9.1. Hon'ble Supreme Court in Mandavi Co-op. Bank Ltd(supra) was dealing with the issue whether the accused was having any right to ask the witness (who was summoned in pursuance of the application made under section-145(2) NI Act) to again appear in the witness box for recording his oral examination-in-chief? This is clear from questions which their Lordships had considered:
"On the basis of the grievances made and reliefs prayed for in those petitions the High Court framed the following two questions as arising for its consideration:
Rapid Diagnostic vs M V Premanath CC No.5031/2010 16 (A) Whether sub-section (2) of section 145 of the Negotiable Instruments Act, 1881, (for short, "the Act") confers an unfettered right on the complainant and the accused to apply to the court seeking direction to give oral examination-in-chief of a person giving evidence on affidavit, even in respect of the facts stated therein and that if such a right is exercised, whether the court is obliged to examine such a person in spite of the mandate of section 145(1) of the Act?
(B) Whether the provisions of section 145 of the Act, as amended by the Negotiable Instruments (Amendment and Miscellaneous Provisions) Act, 2002, (for short "the amending Act of 2002") are applicable to the complaints under section 138 of the Act pending on the date on which the amendment came into force? In other words, do the amended provisions of section 145(1) and (2) of the Act operate retrospectively?"
Hon'ble Supreme Court answered the first question in negative holding that:
".........Hence, notwithstanding the apparent verbal similarity between section 145(2) of the Act and section 296(2) of the Code, it would be completely wrong to interpret the true scope and meaning of the one in the light of the other. Neither the legislative history of 296(2) nor any decision on that section can persuade us to hold that under section 145(2) of the Act, on being summoned at the instance of the accused the complainant or any of his witnesses should be first made to depose in examination-in-chief before cross- examination. "
9.2. Issue of right of cross examination was never raised in the above said judgment. What was raised was that whether accused was having a right to ask the complainant to orally depose before his cross-examination? The answer was negative. What was not decided in the case can not be relied upon for any purpose. And as they say, a judgment is an authority for what it decides and not for what logically can be deduced therefrom. (I would advert to it a little later).
I am of the opinion that the above judgment can also not help the accused.
9.3. One more judgment is operating in the field i.e. Radhey Shyam Garg vs Naresh Kumar Gupta (2010) SLT 507. However, Radhey Shyam Garg is again an authority discussing the necessity of oral examination-in chief of any witness giving evidence on affidavit. No question was raised in respect of Rapid Diagnostic vs M V Premanath CC No.5031/2010 17 right of cross examination (pertinently, in that case, cross examination was already over when the appeal was going on in the Hon'ble Supreme Court).
9.4. Reliance placed on the judgment of Hon'ble High Court in Magma Leasing(supra) is clearly misconceived. The question raised therein was whether Section-145 NI Act is having prospective or retrospective effect. Retrospective effect of provision was accepted by the Hon'ble High Court. Even otherwise, Rajesh Agarwal(supra) being an authority of High Court of Delhi is binding upon this Court. There is no help for the accused in Magma Leasing(supra).
9.5. In Vishnu Bhagwan(supra), it was held that if accused pleads not guilty, matter has to be decided after trial. There is no quarrel with this proposition. In the instant case, trial has not been declined. Trial is going on. What would be the procedure is laid down in Section-143 to Section-147 NI Act. Complainant's evidence is already on record by virtue of Section-145(1) NI Act which can be read in evidence in trial. Requirement of first part of Section-254 CrPC is satisfied. Second part of this section deals with the defence evidence. Accused has ample opportunities to lead defence evidence u/s-254 CrPC. Vishnu Bhagwan(supra) can not help the accused.
9.6.In Som Nath Sapra(supra), it was held that if accused does not plead guilty, prosecution evidence has to be taken first and then accused should be called upon to lead defence evidence as prescribed by Section-254 CrPC. In the present scenario, this judgment would be of no help. Unfortunately for the present accused, now there is Section-145(1) NI Act overriding the provision of CrPC. By this section, affidavit of the complainant given at the time of presummoning evidence can be read in trial. Meaning thereby that requirement of first part of Section-254 CrPC has already been satisfied. And further, with acceptance of signatures on the cheques, consideration, discharge of liability and existence of liability have to be treated as established by virtue of several mandatory presumptions of law (See discussion above). Now, if complainant is called upon to establish his case, it would amount to the abuse of process of law. If we call the complainant again to give post summoning evidence, it would tantamount to breach of legislative mandate given in Section-145(1) NI Act. Som Nath Sapra(supra) can not help the accused.
9.7. Trial is not being denied. There is also no violation of Section-254 CrPC since Rapid Diagnostic vs M V Premanath CC No.5031/2010 18 complainant's evidence in the form of affidavit is already on record. And also that accused is being given opportunity to lead his defence evidence as required by Section-254 CrPC. There is no deviation from the judgments of Hon'ble High Court of Delhi in Vishnu Bhagwan(supra) and Som Nath Sapra(supra).
9.8.It may be noted that Rajesh Agarwal(supra) is not in conflict with Vishnu Bhagwan(supra) and Som Nath Sapra(supra). A similar question was once raised before this Court on the basis of a judgment of Hon'ble High Court of Delhi in Sant Kumar Singh vs State 123 (2005) DLT 136. I had held that there was no conflict between the said decisions. The discussion held therein is appropriate for the present purpose:
"Sant Kumar Singh (supra) deals with a situation of normal criminal trial whereas Rajesh Aggarwal (supra) deals with a specific criminal trial involving a reverse onus clause based upon several mandatory presumptions of law (as discussed in the preceding paragraphs of this order).
Hon'ble Justice H R Malhotra in Sant Kumar Singh vs State 123 (2005) DLT 136 (relied upon by the accused) has held that:
"5. Cardinal principles of criminal law is that the accused is presumed to be innocent unless proved guilty. In this legal back ground, the accused when chooses not to plead guilty cannot be asked to open up his case first. It is the prosecution who is to open up the case. This is so stated in Section 251. In the case in hand, the Metropolitan Magistrate seems to have burdened the petitioner accused with the onus to prove his innocence by putting so many questions to him by taking the aid of Section 251.
6. The plain reading of Section 251 indicates that in case the accused does not plead guilty the Magistrate has simply to ask the accused if he has any defense to make and nothing beyond that. The Magistrate cannot at this initial stage compel the accused to disclose his defense in details particularly when the accused has right to remain silence as guaranteed to him under the Constitution of India. If the accused is asked to disclose his defense before the prosecution open up its case it shall be contrary to the basic fiber of the criminal law which presumes innocence of the accused unless proved otherwise."
Rapid Diagnostic vs M V Premanath CC No.5031/2010 19 There can be no quarrel that the above proposition will apply with full force in a criminal trial where the prosecution is still to lead its evidence. To this extent I am in agreement with the Ld. Counsel for the accused. However, the above highlighted portion is itself an indication that if prosecution case is already established, the accused can be asked to open his defence.
At this juncture, it will be apt to notice the observation of Hon'ble Justice S N Dhingra in Rajesg Agarwal vs State decided on 28.07.2010 wherein he has held that:
"7. The difference between summary trial and summon trial is thus obvious. In summary trial after the accused is summoned, his plea is to be recorded under section 262 (g) of Cr.P.C. and his examination if any can be done by MM and a finding can be given by the court under section 263(h) of his examination. The same procedure is to be followed by the MMs for offence of dishonour of cheque. If proviso a, b & c to Section 138 N.I. Act are shown to have been complied with, technically the commission of offence stands completed. It is for the accused to show that no offence could have been deemed to be committed by him for some specific reasons & defences. He cannot simply say "I am innocent" or "I plead not guilty"
(It appears that in paragraph-7 of the judgment section-262(g) is written whereas the section is 263(g). This seems to be typographical error. This clarification is only for the convenience of the reader).
It is further held therein that:
"8. The procedure being followed presently by learned MMs under section 138 of N.I. Act does not commensurate with the summary trial provisions of Cr.P.C. and provisions of Negotiable Instrument Act and that is the reason that decisions of cases under section 138 of N.I. Act is taking unnecessary long time and the complaints remain pending for years. The procedure as prescribed under law is that along with complaint under section 138 of N.I. Act, the complainant should file affidavit of his evidence and all necessary documents like dishonour memo, returned cheque, notice of demand and then learned MM should scrutinize the complaint & document & if he finds that the affidavit and the documents disclose dishonour of cheque issued by the accused, issuance of a demand notice by the complainant, nonpayment of the cheque amount by the accused despite notice, cheque return memo of the bank etc. and if the court finds that the complaint was filed within the period of limitation, cognizance is to be taken and notice of appearance of accused should be sent to the accused. In case the accused appears before the court of MM, the Court should ask him as to what was his plea of defence. Normally the first date is wasted by the courts of MM just by taking bail bond of the accused and Rapid Diagnostic vs M V Premanath CC No.5031/2010 20 passing a bail order, while section 251 & 263(g) of Cr. P.C. provide that when the accused appears before MM in a summary trial proceedings, the particulars of the offence, to which he is accused, shall be stated to him & he should be asked whether he pleads guilty or he has any defence to make. This is the mandate of section 143 of N.I. Act, which provides summary trial of offence in terms of Cr. P.C. Under Section 263(g) of Cr.P.C., the court has to record the plea of the accused and his examination. It is thus obvious that in a trial of an offence under section 138 N.I. Act the accused cannot simplicitor say "I plead not guilty"
and wants to face trial. Since offence under section 138 of N.I. Act is a document based technical offence, deemed to have been committed because of dishonour of cheque issued by the accused or his company or his firm, the accused must disclose to the Court as to what is his defence on the very first hearing when the accused appears before the Court. If the accused does not appear before the Court of MM on summoning and rather approaches High Court, the High Court has to refuse to entertain him and ask him to appear before the Court of MM as the High Court cannot usurp the powers of MM and entertain a plea of accused why he should not be tried under section 138. This plea as to why he should not be tried under section 138 is to be raised by the accused before the Court of MM under section 251 & under section 263 (g) of Cr. P.C. Along with his plea he can file necessary documents and also make an application, if he is so advised, under Section 145(2) of N.I. Act to recall the complainant to cross-examine him on his plea of defence. However, only after disclosing his plea of defence he can make an application that the case should not be tried summarily but as a summon trial case. This application must disclose the defence of the accused and the reasons why he wants the case to be tried as a summon trial.
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11. The trial under section 138 of NI Act cannot be carried like any other summons trial under IPC offences. The documents placed on record of the Court about the dishonour of cheque are the documents from banks and unless the accused says that these documents are forged, or he had not issued the cheque at all, he did not have any account in the bank, the cheque was not signed by him, the cheque book was forged by the complainant or other similar claim, the evidence of the complainant about dishonour of cheque cannot be questioned, nor the complainant can be asked to depose before the court again. If the case u/s 138 N.I. Act, which is document based, is not tried in summary manner, the sole purpose of making this offence summary trial stands defeated. Thus in all cases under section 138 of N.I. Act, once evidence is given by way of affidavit, at the stage of pre-summoning, the same evidence is to be read by the court at post Rapid Diagnostic vs M V Premanath CC No.5031/2010 21 summoning stage and the witness need not be recalled at post summoning stage unless court of MM, for reasons, considers it necessary."
It is manifestly clear that both the decisions operate in two different fields, cover two different situations. In the first decision, prosecution has to open the case and prove its story whereas in the second decision, prosecution's story has to be treated as proved by virtue of special enactment viz Section-145 NI Act which is having a non-obstinate clause.
I am of the considered opinion that there is no conflict between the two authorities i.e. Sant Kumar Singh(2005) and Rajesh Agarwal(2010)."
9.9. If we see the above discussion, it would become vary clear that Rajesh Agarwal(supra) is not in conflict with any of the earlier decisions of the Hon'ble High Court of Delhi. Therefore, ratio of Rajesh Agarwal(supra) has to be followed in its true spirit.
On Precedents:
10. Needless to emphasize that a judgment is an authority for what it decides and not for what logically can be deduced therefrom.
It would be a futile exercise to quote several pronouncements on the scope of binding precedents and ratio decidendi.
10.1. In the case of Commissioner of Customs (Fort) vs. Toyota Kirloskar Motor (P) Ltd., (2007) 5 SCC 371, the Supreme Court stated the law relating to precedents and held that a decision, as is well known, is an authority for what it decides and not what can logically be deduced therefrom. The ratio of a decision must be culled out from the facts involved in a given case and need not be an authority in generality without reference to the reasons, discussions and facts of the case.
10.2. Furthermore, ratio decidendi of a judgment has to be found out only on reading the entire judgment. The ratio of the judgment is what is set out in the judgment itself. Answer to the question necessarily would have to be read in the context what is set out in the judgment and not in isolation. In case of any doubt as regards any observations, reasons or principles, the other part of the judgment must be looked into. By reading a line here and there from the judgment, one cannot find out the entire Rapid Diagnostic vs M V Premanath CC No.5031/2010 22 ratio decidendi of the judgment. The reasoning could be deciphered upon reading the judgment in its entirety and then applying these principles to the subsequent cases. (Reference : (i) Union of India vs. Godfrey Philips India Ltd., AIR 1996 SC 806, (ii) Union of India vs. Dhanwanti Devi, (1996) 6 SCC 44, (iii) State of Tripura vs. Tripura Bar Association, AIR 1999 SC 1494 and (iv) Islamic Academy of Education vs. State of Karnatake, (2003) 6 SCC 697).
10.3. In Bharat Petroleum Corporation Ltd. And another v. N.R.Vairamani and Another, AIR 2004 SC 4778, it was held that:
"Judgments, even of summit court, are not scriptural absolutes but relative reasoning. Courts should not place reliance on decisions without discussing as to how the factual situation fits in with the fact situation fits in with the fact situation of the decision on which reliance is placed. Observations of Courts are neither to be read as Euclid's theorems nor as provisions of the statute and, that too, torn out of their context. These observations must be read in the context in which they appear to have been stated. Judgments of Courts are not to be construed as statutes. To interpret words, phrases and provisions of a statute, it may become necessary for Judges to embark into lengthy discussions but the discussion is meant to explain and not to define. Judges interpret statutes, they do not interpret judgments. They interpret words of statutes; their words are not to be interpreted as statutes. Circumstantial flexibility, one additional or different fact may make a world of difference between conclusions in two cases. Disposal of cases by blindly placing reliance on a decision is not proper."
10.4. The frequently quoted opinion of the House of Lords in Quinn v. Leathem 1901 AC 495 :
(1900-3) All ER Rep 1 is that of Lord Halsbury, namely, that "every judgment must be read as applicable to the particular facts proved or assumed to be proved.... The other is that a case is only an authority for what it actually decides". These quotations have been reiterated in Goodyear India Ltd. v. State of Haryana and State of Orissa v. Sudhansu Sekhar Misra . In the latter case, the Court explicitly opined that "a decision on a question which has not been argued cannot be treated as a precedent".
10.5. Clearly, in none of the judgments relied upon by the accused, issue of right of cross examination was raised and decided. The judgments relied upon by the accused can not help him.
Rapid Diagnostic vs M V Premanath CC No.5031/2010 23
11. In the situation presented in the earlier paragraphs of this order, recalling of complainant for cross-examination would amount to recalling for a mere pleasure of the accused and to delay the summary trial. The result of the above discussion is that the application of the accused filed under Section-145(2) NI Act deserves a dismissal. It is accordingly dismissed.
12. Accused may prove his defence otherwise. One more opportunity to the accused to lead his defence evidence. Accused to take all necessary steps in his defence.
13. A copy of this order be placed on the official website of the delhi district courts.
(RAKESH KUMAR SINGH) MM-(Central)-01/Delhi/05.12.11 Rapid Diagnostic vs M V Premanath CC No.5031/2010 24