Delhi District Court
Rajender Sharma vs Charanjit Singh on 28 January, 2022
IN THE COURT OF SH. SANJAY SHARMA-II : ADDL. SESSIONS JUDGE-03,
(CENTRAL): TIS HAZARI COURTS, DELHI
Criminal Appeal No. 17/2021
CNR No.: DLCT01-002025-2021
Rajender Sharma
S/o Late C.L. Sharma
R/o. H. No. Z-707, Sidhartha Apartments,
M.P. Enclave, Pitampura, Delhi-110034
..... Appellant
VERSUS
Charanjit Singh
S/o Late Dilbag Singh
R/o H. No. 1E/23, Jhandewalan Extn.,
New Delhi-110055
..... Respondent
Date of Institution : 11.02.2021
Date of Arguments : 02.12.2021
Date of Judgement : 28.01.2022
JUDGEMENT
1. The criminal appeal under Section 374 of 'The Code of Criminal Procedure, 1973' (Hereinafter referred to as 'Cr.P.C.') is directed against judgement dated 09.10.2020 and order on sentence dated 07.01.2021 in CC No. 2359/18 titled as 'Charanjit Singh vs. Rajender Sharma' whereby Ld. ACMM-01, Central District, Tis Hazari Courts, Delhi (In short 'the trial Court') convicted the appellant for committing offence under Section 138 of 'The Negotiable Instruments Act, 1881' (Hereinafter referred to as 'NI Act') and sentenced him to rigorous imprisonment for a period of 1 year and directed him to pay compensation in the sum of Rs. 35,00,000/- to the complainant and in case of default, he is directed to undergo rigorous imprisonment for a period of 3 months.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 1/31BRIEF FACTS:
2. Facts preceding to the institution of the appeal are that on 05.07.2010, the respondent (Hereinafter referred to as 'the complainant') instituted a complaint case under Section 138 NI Act against the appellant on the averments that the appellant had friendly relation with the complainant. In the month of August, 2009; the appellant had approached the complainant for a friendly loan of Rs. 25,00,000/- and assured him that he will repay the said amount within 3 months. On 22.08.2009, the complainant had advanced a friendly loan of Rs. 25,00,000/- to the appellant vide Cheque No. 313021 dated 22.08.2009 in the sum of Rs. 25,00,000/- drawn on 'Bank of India, Jhandewalan Extension Branch, New Delhi' issued in favour of the appellant. In discharge of his liability, the appellant issued a post-dated cheque vide Cheque No. 030203 dated 24.11.2009 in the sum of Rs. 25,00,000/- drawn on 'Allahabad Bank, Rohini, Sector 14 Extension, Delhi-110085' and executed a receipt-cum-promissory note dated 22.08.2009.
3. The complainant's case is that on 22.01.2010, he presented the said cheque for encashment to his banker. The said cheque was returned unpaid with the remark 'FUNDS INSUFFICIENT' vide intimation memo dated 25.01.2010. On assurance of the appellant, the complainant again presented the said cheque for encashment on 07.04.2010. However, it was again returned unpaid with the remark 'FUNDS INSUFFICIENT' vide intimation memo dated 09.04.2010.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 2/314. The complainant sent demand notice dated 30.04.2010 to the appellant through Regd. A.D., U.P.C. and Courier. The appellant was served with the demand notice on 07.05.2010 vide acknowledgement card. The appellant failed to make payment of the cheque amount within 15 days of the receipt thereof. Hence, the complainant filed the complaint case under section 138 NI Act.
SUMMONING ORDER:
5. The trial Court, vide order dated 18.01.2011, summoned the appellant for offence under Section 138 NI Act. NOTICE OF ACCUSATIONS UNDER SECTION 251 CR.P.C.:
6. On 01.06.2011, the trial Court explained substance of accusations to the appellant, as required under Section 251 Cr.P.C., to which he responded as under:
"Q. Do you plead guilty or claim trial? A. I do not know the complainant and I never took the loan from the complainant. The cheque in question was given to Mr. Sunil Dutt in relation to property deal. I received the legal notice dated 30.04.2010, but no reply was given by me. I want to cross examine the complainant as the cheque was not given to him by me."
MEDIATION SETTLEMENT:
7. On 04.01.2012, the appellant settled the case with the complainant as under:
"1. That the respondent has agreed to pay Rs. 25,00,000/- to the complainant by way of four post dated cheques viz. 10.02.2012 bearing No. 507034, 10.03.2012 bearing No. 507035, 10.04.2012 bearing No. 559386 and 10.05.2012 bearing No. 559387, each for Rs. 6,25,000/-, drawn on HDFC Bank, Pitampura Branch, Delhi.Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 3/31
2. That in case of dishonour of any cheque, the remaining outstanding amount shall be payable in lumpsum and not in instalments.
3. That the complainant shall withdraw the present complaint on encashment of all four cheques. There shall be no claim against each other between the parties after the said payment is made by the respondent to the complainant in full."
POST MEDIATION PROCEEDINGS:
8. The appellant failed to make payment of the amount. Eventually, he stopped appearing and he was declared a 'proclaimed person' vide order dated 04.01.2013. He was arrested on 05.01.2018 and admitted on bail on 09.01.2018. THE COMPLAINANT'S EVIDENCE:
9. During trial, the complainant examined 4 witnesses, as under:
(a) The complainant appeared as CW-1 (incorrectly mentioned as 'CW-2'). He proved the said cheque Ex.CW1/A, original cheque returning memo dated 09.04.2010 Ex.CW1/B, copy of legal notice dated 30.04.2010 Ex.CW1/C, original postal receipt Ex.CW1/D, original U.P.C. Ex.CW1/E, original courier receipt Ex.CW1/F and A.D. card Ex.CW1/G.
(b) CW-2 P.K. Raut, Manager, Allahabad Bank, Sector-14 Extension Branch, Rohini, Delhi proved certified copy of statement of account of the appellant Ex.CW2/A, certified copy of cheque returning memo dated 25.01.2010 Ex.CW2/B and certified copy of cheque returning memo dated 09.04.2010 Ex.PW2/C.
(c) CW-3 Rajiv Gosai, Manager, Allahabad Bank, Sector-14 Extension, Rohini, Delhi proved statement of A/c. No. 20366408572 in the name of the appellant for the period from 01.08.2009 to 30.11.2009 Ex.CW3/A.
(d) CW-4 Naresh, Record Keeper, Bank of India, Jhandewalan, Delhi brought statement of account of the complainant dated 24.08.2009 Ex.CW4/A. Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 4/31 EXAMINATION UNDER SECTION 313 CR.P.C.:
10. Incriminating circumstances appearing in the evidence were explained to the appellant as required under Section 313 Cr.P.C. to which he relied as under:
"Q1: It is in evidence against you that CW-2 / complainant has deposed that you had issued cheque bearing No. 030203 dt. 24.11.2009 for a sum of Rs. 25,00,000/- which is Ex.CW1/A which was dishonoured with the remarks 'Funds Insufficient' vide return memo Ex.CW1/B. What you have to say? Ans. It is correct.
Q2: It is further in evidence against you that CW-2 / complainant issued legal notice dated 30.04.2010 Ex.CW1/C to you through registered AD slip and UPC and courier, Original postal receipt Ex.CW1/D, original UPC Ex.CW1/E and original courier receipt Ex.CW1/F, A.D. card acknowledgement Ex.CW1/G demanding payment of cheque amount within the prescribed period. What you have to say? Ans. It is incorrect. I did not receive any legal notice. However, the same bears my correct address. Q3: It is further in evidence against you that CW-3 Sh. Rajiv Gosai proved details of statement of account No. 20366408572 in your name from 01.08.2009 to 30.11.2009 Ex.CW3/A, cheque No. 313021. What you have to say?
Ans. It is a matter of record.
Q4: It is further in evidence against you that CW-4 Sh. Naresh proved account statement of Sh. Charanjit Singh for 24.08.2009 Ex.CW4/A. What you have to say?
Ans. It is a matter of record.
Q5: Why this case against you?
Ans. It is a false case.
Q6: Why PWs have deposed against you?
Ans. They are interested witnesses.
Q7: Do you want to lead defence evidence? Ans. Yes.Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 5/31
Q8: Do you want to say anything else?
Ans. The cheque was a security cheque given by me to the complainant in lieu of some liasoning work as complainant is a political person. The same was supposed to be returned but was misused by the complainant. The cheque amount is not legally recoverable and it was never issued in discharge of my liability."
APPELLANT'S EVIDENCE:
11. The appellant did not examine any witness in defence evidence.
JUDGEMENT:
12. The trial Court, vide judgement dated 09.10.2020 (the impugned judgement), convicted the appellant for committing offence under Section 138 NI Act on the following grounds:
(a) The appellant admitted that he had issued the said cheque;
(b) The said cheque was presented for encashment within its validity period;
(c) The cheque was returned unpaid by the banker of the appellant for insufficient funds;
(d) The appellant was served with demand notice;
(e) There is a statutory presumption in favour of the complainant under Section 139 NI Act that the said cheque was received for the discharge of debt or liability;
(f) The appellant failed to rebut the presumption that the said cheque was issued in discharge of a legally enforceable debt or liability; and
(g) The appellant failed to make payment of the cheque amount within statutory period of 15 days from the date of receipt of the demand notice.Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 6/31
GROUNDS OF APPEAL:
13. Feeling aggrieved by the impugned judgement, the appellant preferred the appeal on the following grounds:
(a) The judgement and the order on sentence are based on surmises and conjectures;
(b) The trial Court did not consider that the appellant handed over blank signed cheque to Mr. Sunil Dutt in relation to a property deal and the said Mr. Sunil Dutt handed over the said cheque to the complainant who mentioned exorbitant amount therein to cheat him;
(c) The said cheque was issued without consideration and the appellant has no liability of making payment against the said cheque;
(d) The appellant never taken any friendly loan from the complainant and there was no loan transaction between them;
(e) The said Mr. Sunil Dutt was not examined;
(f) The trial Court did not consider that the amount and the name in the said cheque were either filled by the complainant or someone else at his instance;
(g) The trial Court did not consider that a blank signed cheque issued to Mr. Sunil Dutt regarding a property deal was filled by the complainant and as such, it comes within mischief of Section 87 NI Act;
(h) The complainant manipulated blank signed stamp paper;
(i) The trial Court did not consider that the appellant did not know the complainant and no one will advance such huge amount on the basis of a cheque;
(j) The complainant did not produce the promissory note before the trial Court;
(k) The complainant did not produce evidence to show that he had sufficient source of income to lend such huge amount to the appellant; and (I) The complainant has not led any evidence to prove his financial capacity from bank record or any witness.Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 7/31
APPEARANCE:
14. I have heard arguments of Mr. Jayant Vashisht, Advocate for the appellant and Mr. Vineet Mehta, Advocate for the complainant and perused written arguments filed by Ld. Counsel for the appellant.
CONTENTIONS OF THE APPELLANT:
15. Ld. Counsel for the appellant contended that the appellant did not receive the demand notice. He contended that the complainant has failed to prove service of demand notice upon the appellant. He contended that the complainant has not mentioned date, time and place of advancement of loan. He contended that the complainant has admitted, in cross- examination, that he had received the said cheque. He contended that it shows that the appellant had given a blank cheque for future liabilities. He contended that the complainant had given the said amount to the appellant regarding a deal of a property in South Delhi as a token amount and the appellant had issued a blank cheque in favour of the complainant for some other purpose which was misused by him. He contended that the complainant admitted, in cross-examination, that loan amount of Rs. 25,00,000/- given to the appellant and he has not shown the said amount in his Income Tax Return (ITR). He contended that advancement of such huge amount without reflecting the said amount in books / documents is a black money. He contended that the said cheque is written with two different inks and as such, it is a material alteration.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 8/3116. Ld. Counsel for the appellant contended that the appellant raised a probable defence that the said cheque was issued as a security. He contended that the complainant has not led any evidence pertaining to mode of advancement of loan. He contended that there is no agreement pertaining to advancement of loan to the appellant. He contended that the complainant has not produced any witness to prove loan transaction. He contended that the trial Court did not consider that the said cheque was a blank signed cheque. He contended that the trial Court did not consider that there was no transaction between the appellant and the complainant. He contended that the mediator to whom an amount of Rs. 5,00,000/- was paid was also not examined. He contended that there was no legally enforceable debt or liability. He contended that the judgement of conviction and order on sentence deserve to be set-aside.
CONTENTIONS OF THE COMPLAINANT:
17. Ld. Counsel for the complainant contended that the complainant and the appellant had friendly relation. He contended that the complainant and the appellant were associated with Indian National Congress Party. He contended that the complainant examined witnesses from his bank and bank of the appellant to prove transfer of an amount of Rs. 25,00,000/- to the account of the appellant on 24.08.2009. He contended that the said cheque was issued towards repayment of the said loan amount.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 9/3118. Ld. Counsel for the complainant contended that the appellant has admitted that he received the demand notice. He contended that the appellant admitted that he had issued the cheque. He contended that the appellant admitted his signature on cheque. He contended that the appellant has failed to rebut statutory presumption under Section 139 NI Act. He contended that the appellant failed to make payment of cheque amount. He contended that the trial Court rightly convicted and sentenced the appellant.
POINTS FOR CONSIDERATION:
(a) What is the scope of jurisdiction of the first appellate Court?
19. The appellate Court is enjoined to assess the entire evidence in the light of the facts and circumstances of the case and arguments addressed before it.
20. In Rajan vs. State of M.P., (1999) 6 SCC 29, Hon'ble Supreme Court of India held as under:
"3.....It cannot be forgotten that the appellate court's jurisdiction is co-extensive with that of the trial court in the matter of assessment, appraisal and appreciation of the evidence and also to determine the disputed issues....."
21. In Narender Bhat & Anr. vs. State of Karnataka, (2009) 17 SCC 785, Hon'ble Supreme Court of India enumerated powers of the appellate Court as under:
"3. This Court has in a series of judgements held that a court exercising appellate power must not only consider questions of law but also questions of fact and in doing so it must subject the evidence to a critical scrutiny....."Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 10/31
22. In Surinder Mohan Katwal vs. State of Himachal Pradesh, (2018) 15 SCC 349, Hon'ble Supreme Court of India summarized powers of the appellate Court under Section 386 Cr.P.C. as under:
"14.....The powers of the appellate court under Section 386 CrPC are the same as that of the trial court. It is true that the trial court being a primary court of facts, which has the advantage of seeing and observing the witnesses has to thoroughly analyse the evidence and record its findings. In an appeal from a conviction, it is for the appellate court to be satisfied affirmatively that the prosecution case is substantially established and record its own findings to confirm the conviction....."
23. Therefore, this Court as the first appellate Court is under a legal duty to re-assess the entire evidence and reach to its own conclusion.
(b) Whether the appellant had drawn a cheque on an account maintained by him with a banker for payment of amount of Rs. 25,00,000/- in favour of the complainant?
24. The case of the complainant is that on 22.08.2009, the appellant had issued the said cheque towards repayment of the loan amount of Rs. 25,00,000/- advanced by him to the appellant for 3 months vide cheque. Ld. Counsel for the appellant contended that the appellant, in reply to notice of accusations under Section 251 Cr.P.C., categorically stated that the complaint filed by the complainant is false and he had not taken any friendly loan from the complainant. He contended that the appellant had given the said cheque to Mr. Sunil Dutt regarding a property deal.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 11/3125. Ld. Counsel for the appellant contended that the said Mr. Sunil Dutt handed over the said cheque to the complainant. He contended that the appellant was not known to the complainant and he is not liable to pay any amount to the complainant. He contended that the complainant has misused the said cheque.
26. The case of the complainant is that he had advanced a friendly loan of Rs. 25,00,000/- without interest to the appellant for a period of 3 months vide Cheque No. 313021 dated 22.08.2009 drawn on 'Bank of India, Jhandewalan Extension Branch, New Delhi' and in order to secure repayment of the said loan amount, the appellant had issued the said cheque in his favour.
27. It is, therefore, evident that the appellant has not disputed his signature on the said cheque. The appellant has also not disputed that the said cheque was drawn on an account maintained by him. In reply to notice of accusations under Section 251 Cr.P.C., the appellant stated that he does not know the complainant and he had never taken loan from the complainant. His defence was that the said cheque was given to Mr. Sunil Dutt regarding a property deal. However, the appellant did not confront the complainant, in cross- examination, that the said cheque was given to Mr. Sunil Dutt regarding a property deal. He did not even confront him that the complainant was not known to him. The entire testimony of the complainant remained unchallenged.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 12/3128. The entire cross-examination of the complainant is as under:
"I know the accused since about 2-3 years ago from the date I had advanced loan to him. I am not having any license to lend money. Vol. The loan was given without interest. The accused and myself are both associated with Indian National Congress Party and through which we were known to each other and he had approached me for a personal loan. The accused was general secretary of Indian National Trade Union Congress. The accused did not tell me any purpose for which he required the loan and only stated that the same is required for his personal needs for a short duration in August, 2009. It is correct that I lend money to the accused without having any business affairs with him. The cheque of Rs. 25 lakhs was given by me to the accused on 22.08.2009 and he had presented the same for encashment thereafter. The accused had executed a promissory note as acknowledgement of the friendly loan and promising to repay the same and had further issued and handed over the cheque in question to me. The promissory note must be on record. At this stage, it has transpired by going through the file that the same is not on record. It is wrong to suggest that since the promissory was never executed, that is the reason the same has not been filed on record. I had taken the cheque in question from the accused at the time I lend him the loan amount. It is wrong to suggest that the cheque in question Ex.CW1/A was a blank signed cheque when the same was given to me. Vol. It was completely filled. The same was given to me by the accused at my office at Jhandewalan. It is wrong to suggest that the cheque Ex.CW1/A was not given in discharge of his legal liability by the accused. It is wrong to suggest that I had misused the cheque Ex.CW1/A. It is wrong to suggest that I am deposing falsely."
(emphasis supplied)
29. It is evident that the appellant did not dispute his acquaintance with the complainant. He did not dispute that he had issued the said cheque to the complainant.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 13/3130. Moreover, in his examination under Section 313 Cr.P.C., the appellant admitted that he had issued the said cheque in favour of the complainant, as under:
"Q1: It is in evidence against you that CW-2 / complainant has deposed that you had issued cheque bearing No. 030203 dt. 24.11.2009 for a sum of Rs. 25,00,000/- which is Ex.CW1/A which was dishonoured with the remarks 'Funds Insufficient' vide return memo Ex.CW1/B. What you have to say? Ans. It is correct.
Q8: Do you want to say anything else?
Ans. The cheque was a security cheque given by me to the complainant in lieu of some liasoning work as complainant is a political person. The same was supposed to be returned but was misused by the complainant. The cheque amount is not legally recoverable and it was never issued in discharge of my liability."
31. Therefore, it is proved beyond any cavil that the appellant had drawn the said cheque on an account maintained by him with a banker in favour of the complainant.
(c) Whether statutory presumption under Section 118 and 139 NI Act that the said cheque was drawn for consideration and the complainant received the said cheque in discharge of liability can be raised?
32. As noticed above, the appellant admitted that he had issued the said cheque in favour of the complainant and the said cheque bears his signature. Statutory presumption under Section 118 and 139 NI Act can be drawn against him.
33. At this stage, it would be appropriate to have a glance to the relevant case law governing requirements for raising statutory presumption under Section 118 and 139 NI Act.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 14/3134. In Bhupesh Rathod vs. Dayashankar Prasad Chaurasia & Anr., Crl. Appeal No. 1105 of 2021 decided on 10.11.2021, Hon'ble Supreme Court of India held as under:
"17. We must say at the inception that the respondent not having disputed his signatures on the cheques, it was for the respondent to show in what circumstances the cheques had been issued, i.e., why was it not a cheque issued in due course. The words of Section 139 of the NI Act are quite clear that unless the contrary is proved, it shall be presumed that the holder of the 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....."
35. In K.S. Ranganatha vs. Vittal Shetty, Crl. Appeal No. 1860 of 2011 decided on 08.11.2011, Hon'ble Supreme Court of India held as under:
"11. The position of law as noted above makes it crystal clear that when a cheque is drawn out and is relied upon by the drawee, it will raise a presumption that it is drawn towards a consideration which is a legally recoverable amount; such presumption of course, is rebuttable by proving to the contrary. The onus is on the accused to raise a probable defence and the standard of proof for rebutting the presumption is on preponderance of probabilities."
36. It is evident that the onus is on the appellant to raise a probable defence and the standard of proof for rebutting the presumption is preponderance of probabilities.
(d) Whether the appellant has rebutted the presumption by raising a probable defence?
37. To rebut the presumption raised under Section 118 and 139 NI Act, the appellant need not to appear in the witness box. He may rely on the evidence of the complainant.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 15/3138. The appellant has taken following defences to rebut statutory presumption that the said cheque was issued in favour of the complainant in discharge of any debt or other liability:
(i) That the appellant had issued the said cheque to Mr. Sunil Dutt regarding a property deal.
39. The appellant, in reply to notice of accusations under Section 251 Cr.P.C., stated that he does not know the complainant and he had never taken any loan from the complainant. He stated that the said cheque was given to Mr. Sunil Dutt in relation to a property deal. However, the appellant did not challenge the testimony of the complainant that he had advanced friendly loan of Rs. 25,00,000/- without interest to the appellant for a period of 3 months and the appellant had handed over the said cheque to him for repayment of the said amount. The appellant questioned the complainant regarding relationship and purpose of loan. The complainant stated that he knew the appellant since 2-3 years ago before he advanced loan to him. He stated that he and the appellant were associated with Indian National Congress Party. He stated that he had given the loan without interest. The appellant did not confront the complainant that he had not issued cheque to him. He did not confront him that he had given the cheque to Mr. Sunil Dutt regarding a property deal. Besides a suggestion that the said cheque was a blank signed cheque when it was issued to the complainant, there is no cross-examination.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 16/3140. In his examination under Section 313 Cr.P.C., the appellant admitted that he had issued the said cheque in favour of the complainant. He admitted that he had issued the said cheque to the complainant as a security cheque regarding some liasoning work as the complainant is a political person. Therefore, there is no material on record that the appellant had given the said cheque to Mr. Sunil Dutt regarding any property deal and the said Mr. Sunil Dutt had colluded with the complainant and the complainant has misused the said cheque.
(ii) That the said cheque was a blank signed cheque and the complainant materially altered the said cheque by filling particulars of the drawee and amount ' in figures' and 'in words'.
41. The appellant did not raise the defence that the said cheque was issued as a blank signed cheque in reply to notice of accusations under Section 251 Cr.P.C. He raised the said defence while cross-examining the complainant. He made a suggestion to the complainant that the cheque in question was a blank signed cheque when it was given to him to which the complainant replied that the said cheque was completely filled. The appellant did not state, in examination under Section 313 Cr.P.C, that the said cheque was issued as a blank signed cheque. He admitted that he had issued the said cheque in the sum of Rs. 25,00,000/- which was dishonoured for insufficient funds. He raised a new defence that the said cheque was issued by him to the complainant as a security cheque for some liasoning work.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 17/3142. The appellant, in examination under Section 313 Cr.P.C., stated that the complainant did not return the said cheque and misused it. There is no correspondence that he ever asked the complainant to return the said cheque. The appellant did not state that he had issued the said cheque as a blank signed cheque to the complainant and the complainant filled the particulars of the drawee and amount 'in figures' and 'in words'. The appellant did not confront the complainant, in his cross-examination, that he had issued the said cheque as a security cheque for some liasoning work which he was supposed to return but he misused it. The appellant has failed to prove that he had issued the said cheque as a blank signed cheque and the complainant materially altered it by filling his name and the amount 'in figures' and 'in words'.
43. Even otherwise, such a defence is not legally sustainable.
44. In Bir Singh vs. Mukesh Kumar, (2019) 4 SCC 197, Hon'ble Supreme Court of India dealt with such a contention as under:
"33. A meaningful reading of the provisions of the Negotiable Instruments Act including, in particular, Sections 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be attracted.Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 18/31
34. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This is itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence.
35. It is not the case of the respondent-accused that he either signed the cheque or parted with it under any threat or coercion. Nor is it the case of the respondent-accused that the unfilled signed cheque had been stolen. The existence of a fiduciary relationship between the payee of a cheque and its drawer, would not disentitle the payee to the benefit of the presumption under Section 139 of the Negotiable Instruments Act, in the absence of evidence of exercise of undue influence or coercion. The second question is also answered in the negative.
36. Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards some payment, would attract presumption under Section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt."
(iii) That the said cheque was a security cheque.
45. The appellant, in his examination under Section 313 Cr.P.C., stated that the said cheque was a security cheque given by him to the complainant in lieu of some liasoning work as the complainant is a political person. The appellant did not state, in reply to notice of accusations under Section 251 Cr.P.C., that he had issued the said cheque as a security cheque to the complainant. His case was that he had issued the said cheque to Mr. Sunil Dutt in relation to a property deal. He even stated that he did not know the complainant.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 19/3146. However, the appellant did not confront the complainant, in cross-examination, that he had issued the said cheque to him as a security cheque for some liasoning work. He did not challenge the testimony of the complainant that the said cheque was issued towards repayment of the loan amount advanced by him.
47. As regards non-examination of Mr. Sunil Dutt by the complainant is concerned, it can be stated that the complainant did not make any reference of him in relation to the transaction. It is the appellant who stated that he had given the said cheque to him in relation to a property deal. However, he neither examined him nor led any evidence that there was any deal in respect of any property in South Delhi.
48. Statement of account of the complainant Ex.CW4/A and the appellant Ex.CW3/A proved that an amount of Rs. 25,00,000/- was transferred from the account of the complainant in Bank of India, Jhandewalan Extension, Delhi to the account of the appellant in Allahabad Bank, Rohini, Sector- 14 Extension, Delhi on 24.08.2009 vide Cheque No. 313021.
49. In his written arguments, the appellant stated that he has paid an amount of Rs. 5,00,000/- to Mr. Sunil Pal Dutt, nephew of the complainant. He has not stated as to why he paid the said amount to nephew of the complainant.
50. It is proved that the appellant had issued the said cheque to the complainant towards repayment of the loan amount transferred to his account on 24.08.2009.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 20/3151. In Sripati Singh vs. The State of Jharkhand & Anr., Crl. Appeal Nos. 1269-1270 of 2021 decided on 28.10.2021, Hon'ble Supreme Court of India held as under:
"16. A cheque issued as security pursuant to a financial transaction cannot be considered as a worthless piece of paper under every circumstance. 'Security' in its true sense is the state of being safe and the security given for a loan is something given as a pledge of payment. It is given, deposited or pledged to make certain the fulfilment of an obligation to which the parties to the transaction are bound. If in a transaction, a loan is advanced and the borrower agrees to repay the amount in a specified timeframe and issues a cheque as security to secure such repayment; if the loan amount is not repaid in any other form before the due date or if there is no other understanding or agreement between the parties to defer the payment of amount, the cheque which is issued as security would mature for presentation and the drawee of the cheque would be entitled to present the same. On such presentation, if the same is dishonoured, the consequences contemplated under Section 138 and the other provisions of N.I. Act would flow.
17. When a cheque is issued and is treated as 'security' towards repayment of an amount with a time period being stipulated for repayment, all that it ensures is that such cheque which is issued as 'security' cannot be presented prior to the loan or the instalment maturing for repayment towards which such cheque is issued as security. Further, the borrower would have the option of repaying the loan amount or such financial liability in any other form and in that manner if the amount of loan due and payable has been discharged within the agreed period, the cheque issued as security cannot thereafter be presented. Therefore, the prior discharge of the loan or there being an altered situation due to which there would be understanding between the parties is a sine qua non to not present the cheque which was issued as security.Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 21/31
These are only the defences that would be available to the drawer of the cheque in a proceeding initiated under Section 138 of the N.I. Act. Therefore, there cannot be a hard and fast rule that a cheque which is issued as security can never be presented by the drawee of the cheque. If such is the understanding a cheque would also be reduced to an 'on demand promissory note' and in all circumstances, it would only be a civil litigation to recover the amount, which is not the intention of the statute. When a cheque is issued even though as 'security' the consequence flowing therefrom is also known to the drawer of the cheque and in the circumstance stated above if the cheque is presented and dishonoured, the holder of the cheque/drawee would have the option of initiating the civil proceedings for recovery or the criminal proceedings for punishment in the fact situation, but in any event, it is not for the drawer of the cheque to dictate terms with regard to the nature of litigation."
52. Therefore, post dated cheque issued by the appellant for repayment of the loan transferred to his account on 24.08.2009 would be covered under Section 138 NI Act. The complainant was entitled to present the said cheque and prosecute the drawee under Section 138 NI Act in case of dishonour of such cheque.
(iv) That the complainant has not produced the promissory note.
53. The complainant has led evidence that an amount of Rs. 25,00,000/- was transferred from his bank account to the bank account of the appellant. Therefore, the case of the complainant cannot be suspected because he has not produced the receipt-cum-promissory note, as stated by him in his complaint.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 22/31(v) That it was highly improbable that the complainant would advance such huge amount to an unknown person.
54. Already noted above, the appellant did not dispute the nature of relationship, amount of loan and mode of advancement of loan. Moreover, the appellant himself stated that he had given the said cheque as a security cheque to the complainant for some liasoning work as the complainant is a political person. In his cross-examination, the complainant stated that they were associated with Indian National Congress Party and known to each other. Therefore, there is evidence that the complainant and the appellant were known to each other. There is evidence that the complainant transferred an amount of Rs. 25,00,000/- to the bank account of the appellant. The appellant, in his written arguments, stated that he returned an amount of Rs. 5,00,000/- the complainant through his nephew. It is beyond comprehension that the appellant would issue a cheque in favour of an unknown person for liasoning work. It is further beyond comprehension that the appellant would return an amount of Rs. 5,00,000/-, where he has no liability to pay anything to the complainant. The appellant did not challenge testimony of the complainant, as deposed in his cross-examination, that he had lent the amount to the appellant without interest and he had taken the said cheque from the appellant at that time. The appellant has not explained as to why the complainant had paid an amount of Rs. 25,00,000/- to him on 24.08.2009 vide cheque.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 23/31(vi) That the complainant has not led any evidence that he had sufficient source of income to lend such huge amount to the appellant.
55. The contention that the complainant has not led any evidence to establish his financial capacity and source of income to lend such huge amount to the appellant is without merit. The complainant has examined his banker and banker of the appellant. Statement of account of the complainant Ex.CW4/A would show that an amount of Rs. 25,00,000/- was transferred to the account of the appellant on 24.08.2009 vide Cheque No. 313021. Statement of account of the appellant Ex.CW3/A would show that an amount of Rs. 25,00,000/- was credited to his account on 24.08.2009 vide Cheque No. 313021. Therefore, the complainant need not to prove his financial capacity and source of income as the loan amount was transferred from his account to the account of the appellant through banking mode.
(vii) That the appellant had given the said cheque to the complainant at the time when the complainant had given the said amount to the appellant as a token money for investment in a property in South Delhi.
56. In written arguments, the appellant contended that he had given the said cheque to the complainant at the time when he had given the said amount to him for investment in a property in South Delhi as a token money. The appellant never taken such defence in reply to notice of accusations under Section 251 Cr.P.C. and examination under Section 313 Cr.P.C. He did not confront the complainant, in his cross- examination, that he made any investment in any property.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 24/3157. The aforesaid contention is an after thought. It has no basis at all. Such general defence without having any foundation in the evidence cannot further the case of the appellant. Therefore, it is evident that the appellant has failed to raise any probable defence to rebut the statutory presumption under Section 118 and 139 NI Act.
58. Resultantly, the complainant proved that the said cheque was drawn by the appellant in discharge of legally enforceable debt or liability.
(e) Whether the said cheque was returned unpaid by the banker of the appellant as the amount standing to his credit was insufficient to honour the said cheque?
59. The complainant has proved intimation memo dated 09.04.2010 Ex.CW1/B that the said cheque was returned unpaid by the banker of the appellant. The complainant has examined CW-2 P.K. Raut, Manager, Allahabad Bank, Rohini, Sector-14 Extension, Delhi-110085. He proved statement of account of the appellant Ex.CW2/A for the period from 01.01.2010 to 30.04.2010. He proved cheque return memo dated 25.01.2010 Ex.CW2/B and cheque return memo dated 09.04.2010 Ex.CW2/C. From statement of account Ex.CW2/A and cheque return memo Ex.CW2/C, it is proved that the banker of the appellant, namely, Allahabad Bank, Rohini, Sector-14 Extension, Delhi-110085 returned the said cheque unpaid as the amount standing to the credit of the appellant in his account was not sufficient to honour the said cheque.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 25/31(f) Whether the complainant sent demand notice to the appellant within 30 days from the date of receipt of intimation regarding the return of the said cheque as unpaid and the appellant received the said notice?
60. The complainant sent demand notice dated 30.04.2010 Ex.CW1/C within 30 days from the date of receipt of intimation regarding dishonour of the said cheque from his banker on 09.04.2010. The said notice was sent through Regd. Post Ex.CW1/D, U.P.C. Ex.CW1/E and courier Ex.CW1/F on 30.04.2010. As per acknowledgement card Ex.CW1/G, the appellant was served with the demand notice on 07.05.2010. In reply to notice of accusations under Section 251 Cr.P.C., the appellant admitted that he had received the said legal notice. He stated that he had not replied the said notice. He did not challenge authenticity of acknowledgement card Ex.CW1/G. However, in his examination under Section 313 Cr.P.C., he stated that he had not received any legal notice. He admitted that the demand notice bears his correct address.
61. Therefore, it is proved that the complainant sent demand notice through postal agency and courier agency at correct address of the appellant within stipulated period. The appellant was served with the demand notice on 07.05.2010. Belated denial of receipt of demand notice would not help the appellant. The appellant failed to make payment of the cheque amount within 15 days from the date of receipt of the demand notice.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 26/31CONCLUSION:
62. On the basis of the aforesaid discussion, it is proved that:
(a) The appellant had drawn the said cheque in favour of the complainant;
(b) The complainant presented the said cheque for encashment within its validity period;
(c) The said cheque was returned unpaid to the complainant for want of funds;
(d) The complainant sent demand notice within statutory period of 30 days;
(e) The appellant failed to make payment of the cheque amount within 15 days of the receipt of the said demand notice;
(f) The appellant failed to raise a probable defence to rebut presumption under Section 118 and 139 NI Act that the complainant received the said cheque for discharge of debt or other liability; and
(g) The said cheque was drawn by the appellant in discharge of debt or other liability he owed to the complainant.
63. Therefore, all the pre-requisites for establishing commission of an offence under Section 138 NI Act are fulfilled. The appellant committed an offence under Section 138 NI Act.
64. On the aspect of sentence, it may be noted that the cheque was returned unpaid on 09.04.2010 and the complaint was instituted on 05.07.2010. The appellant settled the case with the complainant before Delhi Mediation Centre on 04.01.2012. However, the appellant neither paid the settlement amount nor appeared thereafter and resultantly, he was declared a 'proclaimed person' vide order dated 04.01.2013.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 27/3165. The appellant could be apprehended on 05.01.2018. The appellant either absented or sought adjournments and as such, he further delayed conclusion of trial for 3 years.
66. In Bhupesh Rathod (supra), the complaint case pertaining to cheque amount of Rs. 1,60,000/- was instituted on 07.07.2006. Hon'ble Supreme Court of India held that in the given scenario, the respondent should be sentenced with imprisonment for a term of one year and with fine twice the amount of the cheque, i.e. Rs. 3,20,000/- as under:
"29. We now turn to what would be the result of the aforesaid finding. The complaint was instituted in July, 2006. Fifteen (15) years have elapsed since then. The punishment prescribed for such an offence under Section 138 of the NI Act is imprisonment for a term which may extend to two years, or with fine which may extend to twice the amount of the cheque, or with both. We are of the view that in the given scenario the respondent should be sentenced with imprisonment for a term of one year and with fine twice the amount of the cheque, i.e. Rs. 3,20,000/-. However, in view of passage of time, we provide that if the respondent pays a further sum of Rs. 1,60,000/- to the appellant, then the sentence would stand suspended. The needful be done by the respondent within two (2) months from today. The appellant would also be entitled to costs."
67. In Kalamani Tex & Anr. vs. P. Balasubramanian, (2021) 5 SCC 283, Hon'ble Apex Court delineated the need of a consistent approach towards awarding compensation and directed that the courts should uniformly levy fine up to twice the cheque amount alongwith simple interest @ 9% per annum unless there are special circumstances, as under:
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 28/31"19. As regards the claim of compensation raised on behalf of the respondent, we are conscious of the settled principles that the object of Chapter XVII of NIA is not only punitive but also compensatory and restitutive. The provisions of NIA envision a single window for criminal liability for dishonour of cheque as well as civil liability for realization of the cheque amount. It is also well settled that there needs to be a consistent approach towards awarding compensation and unless there exist special circumstances, the courts should uniformly levy fine up to twice the cheque amount along with simple interest @ 9% p.a."
68. In R. Vijayan vs. Baby & Anr, (2012) 1 SCC 260, Hon'ble Supreme Court of India held as under:
"18.....As the provisions of Chapter XVII of the Act strongly lean towards grant of reimbursement of the loss by way of compensation, the courts should, unless there are special circumstances, in all cases of conviction, uniformly exercise the power to levy fine up to twice the cheque amount (keeping in view the cheque amount and the simple interest thereon @ 9% per annum as the reasonable quantum of loss) and direct payment of such amount as compensation....."
69. In the present case, the cheque amount is Rs. 25,00,000/-. The complaint case was instituted on 05.07.2010. As noted above, the appellant evaded the process and as such, he delayed the conclusion of the case for 10 years. The trial Court directed him to pay compensation in the sum of Rs. 35,00,000/-. The trial Court has already taken lenient view in imposition of compensation. As regards sentence for rigorous imprisonment for one year is concerned, keeping in view the conduct of the appellant and to infuse credibility in negotiable instrument, the said sentence for rigorous imprisonment for one year is just and reasonable.
Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 29/3170. Accordingly, the appeal filed by the appellant challenging conviction for commission of offence under Section 138 NI Act is dismissed. The order on sentence for rigorous imprisonment for one year and compensation of Rs. 35,00,000/- and in default thereof, further direction to undergo rigorous imprisonment for three months is maintained.
71. Original FDR in the sum of Rs. 7,00,000/- in the name of the Court be handed over to the complainant. The Chief Manager, Indian Bank, Pitampura, New Delhi is directed to credit the amount of FDR No. 0022885 dated 18.11.2021 to the account of the complainant and as such, balance compensation amount is Rs. 28,00,000/-.
72. The trial Court is directed to take the appellant into custody for serving the sentence. The appellant shall be entitled to benefit of Section 428 Cr.P.C. The trial Court is further directed to take steps for realization of the compensation amount of Rs. 28,00,000/-. A copy of the judgement alongwith trial Court record be sent to the trial Court. Appeal file be consigned to record room.
Digitally signed by SANJAY SANJAY SHARMA SHARMA Date: 2022.01.28 13:14:49 +0530 Announced in the open Court SANJAY SHARMA-II on this 28th January, 2022 Addl. Sessions Judge-03 (Central) Tis Hazari Courts, Delhi Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 30/31 Rajender Sharma vs. Charanjit Singh CNR No.: DLCT010020252021 Crl. Appeal No. 17/2021 28.01.2022 Present : Mr. Jayant Vashisht, Advocate with the appellant.
Mr. Vineet Mehta, Advocate for the respondent / the complainant.
Vide separate judgement, the appeal filed by the appellant challenging conviction for commission of offence under Section 138 NI Act is dismissed. Original FDR in the sum of Rs. 7,00,000/ in the name of the Court be handed over to the complainant, namely, Charanjit Singh. The Chief Manager, Indian Bank, Pitampura, New Delhi is directed to credit the amount of FDR No. 0022885 dated 18.11.2021 to the account of the complainant, namely, Charanjit Singh. A copy of this order be given dasti to Ld. Counsel for the respondent / the complainant. Appeal file be consigned to record room.
Digitally signedSANJAY by SANJAY SHARMA SHARMA Date: 2022.01.28 13:15:00 +0530 Sanjay SharmaII ASJ03, Central District, Tis Hazari Courts, Delhi 28.01.2022 Crl. Appeal No. 17/2021 Rajender Sharma vs. Charanjit Singh Page No. 31/31